Delaware | 54-1817218 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer ☐ | Accelerated filer ☒ |
Non-accelerated filer ☐ (Do not check if a smaller reporting company) | Smaller reporting company ☐ |
Item 1. | Financial Statements | ||
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Item 2. | |||
Item 3. | |||
Item 4. | |||
Part II. Other | |||
Item 1. | |||
Item 1A. | |||
Item 2. | |||
Item 3. | |||
Item 4. | |||
Item 5. | |||
Item 6. | |||
· | national and international political instability fostering uncertainty and volatility in the global economy |
· | significant adverse changes in, reductions in, or |
· | the creditworthiness of our customers and our ability to reserve adequately for credit losses; |
· | reduction of vendor incentives provided to us; |
· | we offer a comprehensive set of |
o | managing a diverse product set of solutions in highly competitive markets with a number of key vendors; |
o | increasing the total number of customers utilizing integrated solutions by up-selling within our customer base and gaining new customers; |
o | adapting to meet changes in markets and competitive developments; |
o | maintaining and increasing advanced professional services by retaining highly skilled personnel and vendor certifications; |
o | increasing the total number of customers who utilize our managed services and professional services and continuing to enhance our managed services offerings to remain competitive in the marketplace; |
o |
o | reliance on third parties to perform some of our service obligations; |
· | changes in the IT industry and/or rapid changes in product offerings, including the proliferation of the cloud, infrastructure as a service and software as a service; |
· | our dependency on continued innovations in hardware, software, and services offerings by our vendors and our ability to partner with them; |
· | future growth rates in our core businesses; |
· | failure to comply with public sector contracts or applicable laws; |
· | changes to or loss of |
· | our dependence on key personnel to maintain certain customer relationships, and our ability to hire, train, and retain sufficient qualified personnel; |
· | our ability to implement comprehensive plans for the integration of sales forces, cost containment, asset rationalization, systems integration and other key strategies; |
· | a possible decrease in the capital spending budgets of our customers or a decrease in purchases from us; |
· | our contracts may not be adequate to protect us and our professional and liability insurance policies coverage may be insufficient to cover a claim; |
· | disruptions in our IT systems and data and audio communication networks; |
· | our ability to secure |
· | our ability to raise capital, maintain or increase as needed our lines of credit with vendors or floor planning facility, or obtain debt for our financing transactions or the effect of those changes on our common stock or its holders; |
· | our ability to realize our investment in leased equipment; |
· | our ability to successfully integrate acquired businesses; |
· | the possibility of goodwill impairment charges in the future; |
· | our ability to protect our intellectual property rights and successfully defend any challenges to the validity of our patents or allegations that we are infringing upon any third party patents, and the costs associated with those actions, and, when appropriate, license required technology; |
· | exposure to changes in, interpretations of, or enforcement trends in legislation; and |
· | significant changes in accounting standards including changes to the financial reporting of leases which could impact the demand for our leasing services, or misclassification of products and services we sell resulting in the misapplication of revenue recognition policies. |
PART I. | FINANCIAL INFORMATION |
Item 1. | Financial Statements |
As of December 31, 2015 | As of March 31, 2015 | As of June 30, 2016 | As of March 31, 2016 | |||||||||||||
ASSETS | (in thousands, except per share data) | (in thousands, except per share data) | ||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 66,567 | $ | 76,175 | $ | 78,807 | $ | 94,766 | ||||||||
Accounts receivable—trade, net | 258,553 | 218,458 | 258,829 | 234,628 | ||||||||||||
Accounts receivable—other, net | 35,908 | 31,345 | 37,909 | 41,771 | ||||||||||||
Inventories—net | 24,971 | 19,835 | 46,376 | 33,343 | ||||||||||||
Financing receivables—net, current | 68,466 | 66,909 | 72,826 | 56,448 | ||||||||||||
Deferred costs | 11,170 | 20,499 | 4,267 | 6,371 | ||||||||||||
Other current assets | 8,198 | 7,413 | 7,605 | 10,649 | ||||||||||||
Total current assets | 473,833 | 440,634 | 506,619 | 477,976 | ||||||||||||
Financing receivables and operating leases—net | 88,443 | 76,991 | 70,285 | 75,906 | ||||||||||||
Deferred tax assets | 4,311 | 3,875 | ||||||||||||||
Property, equipment and other assets | 8,989 | 9,248 | 9,526 | 8,644 | ||||||||||||
Goodwill and other intangible assets | 54,858 | 40,798 | ||||||||||||||
Goodwill and other intangible assets—net | 52,669 | 54,154 | ||||||||||||||
TOTAL ASSETS | $ | 630,434 | $ | 571,546 | $ | 639,099 | $ | 616,680 | ||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||
LIABILITIES | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable—equipment | $ | 28,995 | $ | 20,330 | ||||||||||||
Accounts payable—trade | 47,610 | 46,090 | ||||||||||||||
Accounts payable | $ | 74,608 | $ | 76,780 | ||||||||||||
Accounts payable—floor plan | 127,999 | 99,418 | 144,509 | 121,893 | ||||||||||||
Salaries and commissions payable | 15,002 | 14,860 | 14,102 | 14,981 | ||||||||||||
Deferred revenue | 24,950 | 34,363 | 17,511 | 18,344 | ||||||||||||
Recourse notes payable—current | 2,327 | 889 | 2,299 | 2,288 | ||||||||||||
Non-recourse notes payable—current | 34,800 | 28,560 | 39,151 | 26,042 | ||||||||||||
Other current liabilities | 13,499 | 13,575 | 15,491 | 13,118 | ||||||||||||
Total current liabilities | 295,182 | 258,085 | 307,671 | 273,446 | ||||||||||||
Recourse notes payable—long term | 1,782 | 2,801 | 898 | 1,054 | ||||||||||||
Non-recourse notes payable—long term | 10,656 | 24,314 | 14,581 | 18,038 | ||||||||||||
Deferred tax liability | 3,707 | 3,271 | ||||||||||||||
Deferred tax liability—net | 2,993 | 3,001 | ||||||||||||||
Other liabilities | 2,433 | 3,813 | 3,202 | 2,263 | ||||||||||||
TOTAL LIABILITIES | 313,760 | 292,284 | 329,345 | 297,802 | ||||||||||||
COMMITMENTS AND CONTINGENCIES (Note 7) | ||||||||||||||||
COMMITMENTS AND CONTINGENCIES (Note 8) | ||||||||||||||||
STOCKHOLDERS' EQUITY | ||||||||||||||||
Preferred stock, $.01 per share par value; 2,000 shares authorized; none issued or outstanding | - | - | - | - | ||||||||||||
Common stock, $.01 per share par value; 25,000 shares authorized; 13,237 issued and 7,482 outstanding at December 31, 2015 and 13,114 issued and 7,389 outstanding at March 31, 2015 | 132 | 131 | ||||||||||||||
Common stock, $.01 per share par value; 25,000 shares authorized; 13,296 issued and 7,167 outstanding at June 30, 2016 and 13,237 issued and 7,365 outstanding at March 31, 2016 | 133 | 132 | ||||||||||||||
Additional paid-in capital | 116,441 | 111,072 | 118,969 | 117,511 | ||||||||||||
Treasury stock, at cost, 5,755 and 5,725 shares at December 31, 2015 and March 31, 2015, respectively | (120,654) | (118,179 | ) | |||||||||||||
Treasury stock, at cost, 6,129 and 5,872 shares at June 30, 2016 and March 31, 2016, respectively | (150,555 | ) | (129,518 | ) | ||||||||||||
Retained earnings | 321,267 | 286,477 | 341,895 | 331,224 | ||||||||||||
Accumulated other comprehensive income—foreign currency translation adjustment | (512) | (239 | ) | (688 | ) | (471 | ) | |||||||||
Total Stockholders' Equity | 316,674 | 279,262 | 309,754 | 318,878 | ||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 630,434 | $ | 571,546 | $ | 639,099 | $ | 616,680 |
Three Months Ended December 31, | Nine Months Ended December 31, | Three Months Ended June 30, | ||||||||||||||||||||||
2015 | 2014 | 2015 | 2014 | 2016 | 2015 | |||||||||||||||||||
(in thousands, except per share data) | (in thousands, except per share data) | |||||||||||||||||||||||
Net sales | $ | 298,644 | $ | 306,241 | $ | 904,796 | $ | 876,017 | �� | $ | 298,503 | $ | 269,866 | |||||||||||
Cost of sales | 234,584 | 240,803 | 709,685 | 690,216 | 230,839 | 210,736 | ||||||||||||||||||
Gross profit | 64,060 | 65,438 | 195,111 | 185,801 | 67,664 | 59,130 | ||||||||||||||||||
Professional and other fees | 1,882 | 1,436 | 4,913 | 4,846 | 1,786 | 1,518 | ||||||||||||||||||
Salaries and benefits | 37,372 | 35,632 | 108,326 | 102,831 | 39,798 | 35,214 | ||||||||||||||||||
General and administrative expenses | 6,765 | 7,233 | 21,129 | 20,664 | 6,470 | 5,571 | ||||||||||||||||||
Depreciation and amortization | 1,775 | 1,208 | ||||||||||||||||||||||
Interest and financing costs | 396 | 575 | 1,371 | 1,830 | 349 | 553 | ||||||||||||||||||
Operating expenses | 46,415 | 44,876 | 135,739 | 130,171 | 50,178 | 44,064 | ||||||||||||||||||
Operating income | 17,645 | 20,562 | 59,372 | 55,630 | ||||||||||||||||||||
Other income | - | 6,169 | - | 7,603 | ||||||||||||||||||||
Earnings before tax | 17,645 | 26,731 | 59,372 | 63,233 | 17,486 | 15,066 | ||||||||||||||||||
Provision for income taxes | 7,348 | 11,230 | 24,582 | 26,303 | 6,815 | 6,252 | ||||||||||||||||||
Net earnings | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,930 | $ | 10,671 | $ | 8,814 | ||||||||||||
Net earnings per common share—basic | $ | 1.41 | $ | 2.14 | $ | 4.79 | $ | 5.02 | $ | 1.52 | $ | 1.22 | ||||||||||||
Net earnings per common share—diluted | $ | 1.40 | $ | 2.13 | $ | 4.74 | $ | 4.97 | $ | 1.50 | $ | 1.21 | ||||||||||||
Weighted average common shares outstanding—basic | 7,280 | 7,230 | 7,260 | 7,351 | 7,033 | 7,225 | ||||||||||||||||||
Weighted average common shares outstanding—diluted | 7,329 | 7,279 | 7,336 | 7,413 | 7,108 | 7,301 |
Three Months Ended December 31, | Nine Months Ended December 31, | Three Months Ended June 30, | ||||||||||||||||||||||
2015 | 2014 | 2015 | 2014 | 2016 | 2015 | |||||||||||||||||||
(amounts in thousands) | (amounts in thousands) | |||||||||||||||||||||||
NET EARNINGS | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,930 | $ | 10,671 | $ | 8,814 | ||||||||||||
OTHER COMPREHENSIVE INCOME, NET OF TAX: | ||||||||||||||||||||||||
Foreign currency translation adjustments | (139 | ) | (153 | ) | (273 | ) | (197 | ) | ||||||||||||||||
Foreign currency translation adjustments (net of tax effect of $40 and $11, respectively) | (217 | ) | 43 | |||||||||||||||||||||
Other comprehensive income (loss) | (139 | ) | (153 | ) | (273 | ) | (197 | ) | (217 | ) | 43 | |||||||||||||
TOTAL COMPREHENSIVE INCOME | $ | 10,158 | $ | 15,348 | $ | 34,517 | $ | 36,733 | $ | 10,454 | $ | 8,857 |
Nine Months Ended December 31, | Three Months Ended June 30, | |||||||||||||||
2015 | 2014 | 2016 | 2015 | |||||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Cash Flows From Operating Activities: | ||||||||||||||||
Net earnings | $ | 34,790 | $ | 36,930 | $ | 10,671 | $ | 8,814 | ||||||||
Adjustments to reconcile net earnings to net cash (used in) provided by operating activities: | ||||||||||||||||
Depreciation and amortization | 13,020 | 11,441 | 2,775 | 4,235 | ||||||||||||
Reserve for credit losses, inventory obsolescence and sales returns | (91 | ) | 275 | 191 | (391 | ) | ||||||||||
Share-based compensation expense | 4,210 | 3,428 | 1,458 | 1,231 | ||||||||||||
Excess tax benefit from share-based compensation | (1,159 | ) | (734 | ) | ||||||||||||
Payments from lessees directly to lenders—operating leases | (3,587 | ) | (6,011 | ) | (1,884 | ) | (1,458 | ) | ||||||||
Gain on disposal of property, equipment and operating lease equipment | (2,621 | ) | (2,438 | ) | (889 | ) | (325 | ) | ||||||||
Gain on sale of financing receivables | (5,439 | ) | (4,640 | ) | (1,455 | ) | (1,490 | ) | ||||||||
Gain on settlement | - | (1,434 | ) | |||||||||||||
Other | 224 | 46 | 109 | 47 | ||||||||||||
Changes in: | ||||||||||||||||
Accounts receivable—trade | (31,692 | ) | (27,378 | ) | (24,283 | ) | 31,368 | |||||||||
Accounts receivable—other | (1,176 | ) | 4,492 | 4,378 | 6,416 | |||||||||||
Inventories | (5,643 | ) | (314 | ) | (13,188 | ) | (5,384 | ) | ||||||||
Financing receivables—net | (10,670 | ) | (14,927 | ) | 244 | (65 | ) | |||||||||
Deferred costs, other intangible assets and other assets | 5,888 | (6,309 | ) | 4,115 | (3,027 | ) | ||||||||||
Accounts payable—equipment | (197 | ) | (578 | ) | ||||||||||||
Accounts payable—trade | (5,715 | ) | (15,451 | ) | ||||||||||||
Accounts payable | 3,827 | (13,350 | ) | |||||||||||||
Salaries and commissions payable, deferred revenue and other liabilities | (9,018 | ) | 13,672 | 1,212 | (3,792 | ) | ||||||||||
Net cash used in operating activities | $ | (18,876 | ) | $ | (9,930 | ) | ||||||||||
Net cash (used in) provided by operating activities | $ | (12,719 | ) | $ | 21,756 | |||||||||||
Cash Flows From Investing Activities: | ||||||||||||||||
Maturities of supplemental benefit plan investments | $ | - | $ | 2,544 | ||||||||||||
Proceeds from sale of property, equipment and operating lease equipment | 5,349 | 7,401 | $ | 2,100 | $ | 1,843 | ||||||||||
Purchases of property, equipment and operating lease equipment | (17,008 | ) | (7,571 | ) | (890 | ) | (6,924 | ) | ||||||||
Purchases of assets to be leased or financed | (10,828 | ) | (7,628 | ) | (6,052 | ) | (9,437 | ) | ||||||||
Issuance of financing receivables | (102,612 | ) | (93,205 | ) | (32,100 | ) | (44,253 | ) | ||||||||
Repayments of financing receivables | 49,230 | 50,577 | 5,856 | 21,132 | ||||||||||||
Proceeds from sale of financing receivables | 48,174 | 24,216 | 13,576 | 11,214 | ||||||||||||
Premiums paid on life insurance | - | (47 | ) | |||||||||||||
Cash used in acquisitions, net of cash acquired | (16,649 | ) | (7,992 | ) | ||||||||||||
Net cash used in investing activities | $ | (44,344 | ) | $ | (31,705 | ) | $ | (17,510 | ) | $ | (26,425 | ) |
Nine Months Ended December 31, | Three Months Ended June 30, | |||||||||||||||
2015 | 2014 | 2016 | 2015 | |||||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Cash Flows From Financing Activities: | ||||||||||||||||
Borrowings of non-recourse and recourse notes payable | $ | 27,865 | $ | 40,329 | $ | 11,979 | $ | 7,957 | ||||||||
Repayments of non-recourse and recourse notes payable | (254 | ) | (1,580 | ) | (2 | ) | (186 | ) | ||||||||
Repurchase of common stock | (2,475 | ) | (37,080 | ) | (20,640 | ) | (2,475 | ) | ||||||||
Dividends paid | (80 | ) | (90 | ) | - | (80 | ) | |||||||||
Payments of contingent consideration | (1,158 | ) | - | |||||||||||||
Excess tax benefit from share-based compensation | 1,159 | 734 | ||||||||||||||
Net borrowings (repayments) on floor plan facility | 28,581 | 10,689 | 22,616 | 10,983 | ||||||||||||
Net cash provided by financing activities | 53,638 | 13,002 | 13,953 | 16,199 | ||||||||||||
Effect of exchange rate changes on cash | (26 | ) | (24 | ) | 317 | 3 | ||||||||||
Net Decrease in Cash and Cash Equivalents | (9,608 | ) | (28,657 | ) | ||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | (15,959 | ) | 12,606 | |||||||||||||
Cash and Cash Equivalents, Beginning of Period | 76,175 | 80,179 | 94,766 | 76,175 | ||||||||||||
Cash and Cash Equivalents, End of Period | $ | 66,567 | $ | 51,522 | $ | 78,807 | $ | 88,781 | ||||||||
Supplemental Disclosures of Cash Flow Information: | ||||||||||||||||
Cash paid for interest | $ | 65 | $ | 201 | $ | 19 | $ | 27 | ||||||||
Cash paid for income taxes | $ | 26,463 | $ | 26,233 | $ | 1,367 | $ | 9,072 | ||||||||
Schedule of Non-Cash Investing and Financing Activities: | ||||||||||||||||
Proceeds from sales of property, equipment and operating lease equipment | $ | 7,993 | $ | 297 | ||||||||||||
Purchase of property, equipment, and operating leases | $ | (11,985 | ) | $ | (336 | ) | ||||||||||
Purchase of assets to be leased or financed included in accounts payable | $ | (8,554 | ) | $ | (15,633 | ) | ||||||||||
Investing Activities | ||||||||||||||||
Proceeds from sale of property, equipment, and operating lease equipment | $ | 161 | $ | 6,783 | ||||||||||||
Purchase of property, equipment, and operating lease equipment | $ | (1,873 | ) | $ | (8,069 | ) | ||||||||||
Purchase of assets to be leased or financed | $ | (9,247 | ) | $ | (3,781 | ) | ||||||||||
Issuance of financing receivables | $ | (91,022 | ) | $ | - | $ | (39,779 | ) | $ | (39,154 | ) | |||||
Repayment of financing receivables | $ | 12,357 | $ | - | $ | 7,114 | $ | 4,831 | ||||||||
Proceeds from sale of financing receivables | $ | 75,584 | $ | 79,663 | $ | 31,901 | $ | 6,960 | ||||||||
Financing Activities | ||||||||||||||||
Borrowing of recourse and nonrecourse notes payable | $ | 42,840 | $ | - | $ | 12,210 | $ | 27,603 | ||||||||
Repayments of non-recourse and recourse notes payable | $ | (22,292 | ) | $ | (26,469 | ) | $ | (9,616 | ) | $ | (10,498 | ) | ||||
Vesting of share-based compensation | $ | 7,743 | $ | 6,439 | $ | 7,280 | $ | 7,083 | ||||||||
Contingent consideration | $ | - | $ | 1,980 | ||||||||||||
Repurchase of common stock included in accounts payable | $ | (1,459 | ) | $ | - |
Common Stock | Additional Paid-In | Treasury | Retained | Accumulated Other Comprehensive | Common Stock | Additional Paid-In | Treasury | Retained | Accumulated Other Comprehensive | |||||||||||||||||||||||||||||||||||||||||||||||
Shares | Par Value | Capital | Stock | Earnings | Income | Total | Shares | Par Value | Capital | Stock | Earnings | Income | Total | |||||||||||||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance, April 1, 2015 | 7,389 | $ | 131 | $ | 111,072 | $ | (118,179 | ) | $ | 286,477 | $ | (239 | ) | $ | 279,262 | |||||||||||||||||||||||||||||||||||||||||
Excess tax benefit of share-based ompensation | - | - | 1,159 | - | - | - | 1,159 | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance, April 1, 2016 | 7,365 | $ | 132 | $ | 117,511 | $ | (129,518 | ) | $ | 331,224 | $ | (471 | ) | $ | 318,878 | |||||||||||||||||||||||||||||||||||||||||
Issuance of shares for option exercises | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||
Excess tax benefit of share- based compensation | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of restricted stock awards | 123 | 1 | - | - | - | - | 1 | 59 | 1 | - | - | - | - | 1 | ||||||||||||||||||||||||||||||||||||||||||
Share-based compensation | - | - | 4,210 | - | - | - | 4,210 | (257 | ) | - | 1,458 | - | - | - | 1,458 | |||||||||||||||||||||||||||||||||||||||||
Repurchase of common stock | (30 | ) | - | - | (2,475 | ) | - | - | (2,475 | ) | - | - | - | (21,037 | ) | - | - | (21,037 | ) | |||||||||||||||||||||||||||||||||||||
Dividends declared | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||
Net earnings | - | - | - | - | 34,790 | - | 34,790 | - | - | - | - | 10,671 | - | 10,671 | ||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | - | - | - | - | - | (273 | ) | (273 | ) | - | - | - | - | - | (217 | ) | (217 | ) | ||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2015 | 7,482 | $ | 132 | $ | 116,441 | $ | (120,654 | ) | $ | 321,267 | $ | (512 | ) | $ | 316,674 | |||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2016 | 7,167 | $ | 133 | $ | 118,969 | $ | (150,555 | ) | $ | 341,895 | $ | (688 | ) | $ | 309,754 |
1. | ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
2. | RECENT ACCOUNTING PRONOUNCEMENTS |
FINANCING RECEIVABLES AND OPERATING LEASES |
December 31, 2015 | Notes Receivables | Lease-Related Receivables | Total Financing Receivables | |||||||||||||||||||||
June 30, 2016 | Notes Receivables | Lease-Related Receivables | Total Financing Receivables | |||||||||||||||||||||
Minimum payments | $ | 56,311 | $ | 74,551 | $ | 130,862 | $ | 56,191 | $ | 73,233 | $ | 129,424 | ||||||||||||
Estimated unguaranteed residual value (1) | - | 10,893 | 10,893 | - | 16,748 | 16,748 | ||||||||||||||||||
Initial direct costs, net of amortization (2) | 439 | 845 | 1,284 | 581 | 477 | 1,057 | ||||||||||||||||||
Unearned income | - | (6,405 | ) | (6,405 | ) | - | (5,842 | ) | (5,842 | ) | ||||||||||||||
Reserve for credit losses (3) | (3,580 | ) | (831 | ) | (4,411 | ) | (3,452 | ) | (731 | ) | (4,182 | ) | ||||||||||||
Total, net | $ | 53,170 | $ | 79,053 | $ | 132,223 | $ | 53,320 | $ | 83,885 | $ | 137,205 | ||||||||||||
Reported as: | ||||||||||||||||||||||||
Current | $ | 29,733 | $ | 38,733 | $ | 68,466 | $ | 37,454 | $ | 35,372 | $ | 72,826 | ||||||||||||
Long-term | 23,437 | 40,320 | 63,757 | 15,866 | 48,513 | 64,379 | ||||||||||||||||||
Total, net | $ | 53,170 | $ | 79,053 | $ | 132,223 | $ | 53,320 | $ | 83,885 | $ | 137,205 |
(1) | Includes estimated unguaranteed residual values of |
(2) | Initial direct costs are shown net of amortization of |
(3) | For details on reserve for credit losses, refer to Note |
March 31, 2015 | Notes Receivables | Lease-Related Receivables | Total Financing Receivables | |||||||||||||||||||||
March 31, 2016 | Notes Receivables | Lease-Related Receivables | Total Financing Receivables | |||||||||||||||||||||
Minimum payments | $ | 59,943 | $ | 66,415 | $ | 126,358 | $ | 44,442 | $ | 66,303 | $ | 110,745 | ||||||||||||
Estimated unguaranteed residual value (1) | - | 8,376 | 8,376 | - | 12,693 | 12,693 | ||||||||||||||||||
Initial direct costs, net of amortization (2) | 429 | 495 | 924 | 312 | 475 | 787 | ||||||||||||||||||
Unearned income | - | (5,233 | ) | (5,233 | ) | - | (5,543 | ) | (5,543 | ) | ||||||||||||||
Reserve for credit losses (3) | (3,573 | ) | (881 | ) | (4,454 | ) | (3,381 | ) | (685 | ) | (4,066 | ) | ||||||||||||
Total, net | $ | 56,799 | $ | 69,172 | $ | 125,971 | $ | 41,373 | $ | 73,243 | $ | 114,616 | ||||||||||||
Reported as: | ||||||||||||||||||||||||
Current | $ | 33,484 | $ | 33,425 | $ | 66,909 | $ | 24,962 | $ | 31,486 | $ | 56,448 | ||||||||||||
Long-term | 23,315 | 35,747 | 59,062 | 16,411 | 41,757 | 58,168 | ||||||||||||||||||
Total, net | $ | 56,799 | $ | 69,172 | $ | 125,971 | $ | 41,373 | $ | 73,243 | $ | 114,616 |
(1) | Includes estimated unguaranteed residual values of |
(2) | Initial direct costs are shown net of amortization of |
(3) | For details on reserve for credit losses, refer to Note |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||
Cost of equipment under operating leases | $ | 43,240 | $ | 36,283 | $ | 15,572 | $ | 36,635 | ||||||||
Accumulated depreciation | (18,554 | ) | (18,354 | ) | (9,666 | ) | (18,897 | ) | ||||||||
Investment in operating lease equipment—net (1) | $ | 24,686 | $ | 17,929 | $ | 5,906 | $ | 17,738 |
(1) | These totals include estimated unguaranteed residual values of |
GOODWILL AND OTHER INTANGIBLE ASSETS |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization / Impairment Loss | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization / Impairment Loss | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization / Impairment Loss | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization / Impairment Loss | Net Carrying Amount | |||||||||||||||||||||||||||||||||||||
Goodwill | $ | 51,026 | $ | (8,673 | ) | $ | 42,353 | $ | 42,785 | $ | (8,673 | ) | $ | 34,112 | $ | 50,684 | $ | (8,673 | ) | $ | 42,011 | $ | 50,824 | $ | (8,673 | ) | $ | 42,151 | ||||||||||||||||||||
Customer relationships & other intangibles | 19,680 | (8,069 | ) | 11,611 | 12,005 | (6,560 | ) | 5,445 | 20,205 | (10,247 | ) | 9,958 | 20,401 | (9,193 | ) | 11,208 | ||||||||||||||||||||||||||||||||
Capitalized software development | 2,693 | (1,799 | ) | 894 | 2,693 | (1,452 | ) | 1,241 | 2,722 | (2,022 | ) | 700 | 2,709 | (1,914 | ) | 795 | ||||||||||||||||||||||||||||||||
Total | $ | 73,399 | $ | (18,541 | ) | $ | 54,858 | $ | 57,483 | $ | (16,685 | ) | $ | 40,798 | $ | 73,611 | $ | (20,942 | ) | $ | 52,669 | $ | 73,934 | $ | (19,780 | ) | $ | 54,154 |
Reporting Unit | December 31, 2015 | March 31, 2015 | ||||||
Technology | $ | 41,264 | $ | 33,023 | ||||
Software Document Management | 1,089 | 1,089 |
RESERVES FOR CREDIT LOSSES |
Accounts Receivable | Notes Receivable | Lease-Related Receivables | Total | |||||||||||||
Balance April 1, 2015 | $ | 1,169 | $ | 3,573 | $ | 881 | $ | 5,623 | ||||||||
Provision for credit losses | 12 | 7 | (50 | ) | (31 | ) | ||||||||||
Write-offs and other | (119 | ) | - | - | (119 | ) | ||||||||||
Balance December 31, 2015 | $ | 1,062 | $ | 3,580 | $ | 831 | $ | 5,473 |
Accounts Receivable | Notes Receivable | Lease-Related Receivables | Total | |||||||||||||
Balance April 1, 2016 | $ | 1,127 | $ | 3,381 | $ | 685 | $ | 5,193 | ||||||||
Provision for credit losses | 15 | 71 | 46 | 132 | ||||||||||||
Balance June 30, 2016 | $ | 1,142 | $ | 3,452 | $ | 731 | $ | 5,325 |
Accounts Receivable | Notes Receivable | Lease-Related Receivables | Total | Accounts Receivable | Notes Receivable | Lease-Related Receivables | Total | |||||||||||||||||||||||||
Balance April 1, 2014 | $ | 1,364 | $ | 3,364 | $ | 1,024 | $ | 5,752 | ||||||||||||||||||||||||
Balance April 1, 2015 | $ | 1,169 | $ | 3,573 | $ | 881 | $ | 5,623 | ||||||||||||||||||||||||
Provision for credit losses | 69 | 244 | 39 | 352 | (149 | ) | (33 | ) | 34 | (148 | ) | |||||||||||||||||||||
Write-offs and other | (228 | ) | - | (31 | ) | (259 | ) | (77 | ) | - | - | (77 | ) | |||||||||||||||||||
Balance December 31, 2014 | $ | 1,205 | $ | 3,608 | $ | 1,032 | $ | 5,845 | ||||||||||||||||||||||||
Balance June 30, 2015 | $ | 943 | $ | 3,540 | $ | 915 | $ | 5,398 |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||||||||||||||||||
Notes Receivable | Lease- Related Receivables | Notes Receivable | Lease- Related Receivables | Notes Receivable | Lease- Related Receivables | Notes Receivable | Lease- Related Receivables | |||||||||||||||||||||||||
Reserves for credit losses: | ||||||||||||||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 427 | $ | 708 | $ | 440 | $ | 740 | $ | 350 | $ | 608 | $ | 279 | $ | 562 | ||||||||||||||||
Ending balance: individually evaluated for impairment | 3,153 | 123 | 3,133 | 141 | 3,102 | 123 | 3,102 | 123 | ||||||||||||||||||||||||
Ending balance | $ | 3,580 | $ | 831 | $ | 3,573 | $ | 881 | $ | 3,452 | $ | 731 | $ | 3,381 | $ | 685 | ||||||||||||||||
Minimum payments: | ||||||||||||||||||||||||||||||||
Ending balance: collectively evaluated for impairment | $ | 53,109 | $ | 74,409 | $ | 56,525 | $ | 66,255 | $ | 53,089 | $ | 73,091 | $ | 41,340 | $ | 66,161 | ||||||||||||||||
Ending balance: individually evaluated for impairment | 3,202 | 142 | 3,418 | 160 | 3,102 | 142 | 3,102 | 142 | ||||||||||||||||||||||||
Ending balance | $ | 56,311 | $ | 74,551 | $ | 59,943 | $ | 66,415 | $ | 56,191 | $ | 73,233 | $ | 44,442 | $ | 66,303 |
31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Unbilled Minimum Lease Payments | Total Minimum Lease Payments | Unearned Income | Non- Recourse Notes Payable | Net Credit Exposure | 31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Unbilled Minimum Lease Payments | Total Minimum Lease Payments | Unearned Income | Non- Recourse Notes Payable | Net Credit Exposure | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30,2016 | June 30,2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
High CQR | $ | 175 | $ | 78 | $ | 422 | $ | 675 | $ | 935 | $ | 54,323 | $ | 55,933 | $ | (3,664 | ) | $ | (23,362 | ) | $ | 28,907 | $ | 330 | $ | 149 | $ | 266 | $ | 745 | $ | 302 | $ | 49,644 | $ | 50,691 | $ | (2,808 | ) | $ | (19,741 | ) | $ | 28,142 | ||||||||||||||||||||||||||||||||||||
Average CQR | 50 | 13 | 66 | 129 | 79 | 18,268 | 18,476 | (1,394 | ) | (6,566 | ) | 10,516 | 47 | 24 | 34 | 105 | 64 | 22,231 | 22,400 | (1,251 | ) | (2,766 | ) | 18,383 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Low CQR | - | - | 142 | 142 | - | - | 142 | (19 | ) | - | 123 | - | - | 142 | 142 | - | - | 142 | (19 | ) | - | 123 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 225 | $ | 91 | $ | 630 | $ | 946 | $ | 1,014 | $ | 72,591 | $ | 74,551 | $ | (5,077 | ) | $ | (29,928 | ) | $ | 39,546 | $ | 377 | $ | 173 | $ | 442 | $ | 992 | $ | 366 | $ | 71,875 | $ | 73,233 | $ | (4,078 | ) | $ | (22,507 | ) | $ | 46,648 | ||||||||||||||||||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2016 | March 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
High CQR | $ | 70 | $ | 185 | $ | 133 | $ | 388 | $ | 430 | $ | 41,213 | $ | 42,031 | $ | (2,340 | ) | $ | (16,561 | ) | $ | 23,130 | $ | 575 | $ | 52 | $ | 94 | $ | 721 | $ | 984 | $ | 46,157 | $ | 47,862 | $ | (2,705 | ) | $ | (22,914 | ) | $ | 22,243 | ||||||||||||||||||||||||||||||||||||
Average CQR | 15 | 68 | 19 | 102 | 75 | 24,047 | 24,224 | (1,742 | ) | (9,397 | ) | 13,085 | 15 | 17 | 78 | 110 | 159 | 18,030 | 18,299 | (1,387 | ) | (8,714 | ) | 8,198 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Low CQR | - | - | - | - | - | 160 | 160 | (19 | ) | - | 141 | - | - | 142 | 142 | - | - | 142 | (19 | ) | - | 123 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 85 | $ | 253 | $ | 152 | $ | 490 | $ | 505 | $ | 65,420 | $ | 66,415 | $ | (4,101 | ) | $ | (25,958 | ) | $ | 36,356 | $ | 590 | $ | 69 | $ | 314 | $ | 973 | $ | 1,143 | $ | 64,187 | $ | 66,303 | $ | (4,111 | ) | $ | (31,628 | ) | $ | 30,564 |
31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Unbilled Notes Receivable | Total Notes Receivable | Non- Recourse Notes Payable | Net Credit Exposure | 31-60 Days Past Due | 61-90 Days Past Due | Greater than 90 Days Past Due | Total Past Due | Current | Unbilled Notes Receivable | Total Notes Receivable | Non- Recourse Notes Payable | Net Credit Exposure | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
June 30, 2016 | June 30, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
High CQR | $ | 837 | $ | 585 | $ | 2,253 | $ | 3,675 | $ | 252 | $ | 30,416 | $ | 34,343 | $ | (20,690 | ) | $ | 13,653 | $ | 785 | $ | - | $ | 2,168 | $ | 2,953 | $ | 2,739 | $ | 29,366 | $ | 35,058 | $ | (18,630 | ) | $ | 16,428 | ||||||||||||||||||||||||||||||||||
Average CQR | 265 | - | 174 | 439 | 97 | 18,230 | 18,766 | (11,536 | ) | 7,230 | 723 | 80 | - | 803 | 142 | 17,086 | 18,031 | (12,130 | ) | 5,901 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Low CQR | - | - | 3,102 | 3,102 | - | 100 | 3,202 | - | 3,202 | - | - | 3,102 | 3,102 | - | - | 3,102 | - | 3,102 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,102 | $ | 585 | $ | 5,529 | $ | 7,216 | $ | 349 | $ | 48,746 | $ | 56,311 | $ | (32,226 | ) | $ | 24,085 | $ | 1,508 | $ | 80 | $ | 5,270 | $ | 6,858 | $ | 2,881 | $ | 46,452 | $ | 56,191 | $ | (30,760 | ) | $ | 25,431 | ||||||||||||||||||||||||||||||||||
March 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
March 31, 2016 | March 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
High CQR | $ | 338 | $ | 260 | $ | 161 | $ | 759 | $ | 2,455 | $ | 35,996 | $ | 39,210 | $ | (18,255 | ) | $ | 20,955 | $ | 399 | $ | 305 | $ | 2,168 | $ | 2,872 | $ | 301 | $ | 24,092 | $ | 27,265 | $ | (11,644 | ) | $ | 15,621 | ||||||||||||||||||||||||||||||||||
Average CQR | 57 | - | - | 57 | 376 | 16,882 | 17,315 | (11,665 | ) | 5,650 | - | - | - | - | 202 | 13,873 | 14,075 | (9,942 | ) | 4,133 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Low CQR | - | - | 656 | 656 | - | 2,762 | 3,418 | - | 3,418 | - | - | 3,102 | 3,102 | - | - | 3,102 | - | 3,102 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 395 | $ | 260 | $ | 817 | $ | 1,472 | $ | 2,831 | $ | 55,640 | $ | 59,943 | $ | (29,920 | ) | $ | 30,023 | $ | 399 | $ | 305 | $ | 5,270 | $ | 5,974 | $ | 503 | $ | 37,965 | $ | 44,442 | $ | (21,586 | ) | $ | 22,856 |
PROPERTY, EQUIPMENT, OTHER ASSETS AND LIABILITIES |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||
Other current assets: | ||||||||||||||||
Deposits & funds held in escrow | $ | 565 | $ | 4,281 | $ | 3,105 | $ | 3,116 | ||||||||
Prepaid assets | 3,165 | 2,652 | 3,654 | 6,683 | ||||||||||||
Other | 4,468 | 480 | 846 | 850 | ||||||||||||
Total other current assets | $ | 8,198 | $ | 7,413 | $ | 7,605 | $ | 10,649 | ||||||||
Other assets: | ||||||||||||||||
Deferred costs | $ | 2,155 | $ | 2,308 | $ | 1,842 | $ | 1,831 | ||||||||
Property and equipment, net | 6,160 | 6,127 | 6,166 | 6,266 | ||||||||||||
Other | 674 | 813 | 1,518 | 547 | ||||||||||||
Total other assets - long term | $ | 8,989 | $ | 9,248 | $ | 9,526 | $ | 8,644 |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||
Other current liabilities: | ||||||||||||||||
Accrued expenses | $ | 5,244 | $ | 5,302 | $ | 7,481 | $ | 7,109 | ||||||||
Deferred compensation | - | 222 | ||||||||||||||
Other | 8,255 | 8,051 | 8,010 | 6,009 | ||||||||||||
Total other current liabilities | $ | 13,499 | $ | 13,575 | $ | 15,491 | $ | 13,118 | ||||||||
Other liabilities: | ||||||||||||||||
Deferred revenue | $ | 2,049 | $ | 2,923 | $ | 1,908 | $ | 1,866 | ||||||||
Other | 384 | 890 | 1,294 | 397 | ||||||||||||
Total other liabilities - long term | $ | 2,433 | $ | 3,813 | $ | 3,202 | $ | 2,263 |
NOTES PAYABLE AND CREDIT FACILITY |
December 31, 2015 | March 31, 2015 | June 30, 2016 | March 31, 2016 | |||||||||||||
Recourse notes payable with interest rates ranging from 2.70% and 5.00% at December 31, 2015 and ranging from 2.24% and 4.13% at March 31, 2015. | ||||||||||||||||
Recourse notes payable with interest rates ranging from 2.70% and 4.13% at June 30, 2016 and at March 31, 2016. | ||||||||||||||||
Current | $ | 2,327 | $ | 889 | $ | 2,299 | $ | 2,288 | ||||||||
Long-term | 1,782 | 2,801 | 898 | 1,054 | ||||||||||||
Total recourse notes payable | $ | 4,109 | $ | 3,690 | $ | 3,197 | $ | 3,342 | ||||||||
Non-recourse notes payable secured by financing receivables and investments in operating leases with interest rates ranging from 1.70% to 7.50% at December 31, 2015 and ranging from 1.70% to 10.00% as of March 31, 2015. | ||||||||||||||||
Non-recourse notes payable secured by financing receivables and investments in operating leases with interest rates ranging from 2.00% to 8.00% at June 30, 2016 and ranging from 1.70% to 8.50% as of March 31, 2016. | ||||||||||||||||
Current | $ | 34,800 | $ | 28,560 | $ | 39,151 | $ | 26,042 | ||||||||
Long-term | 10,656 | 24,314 | 14,581 | 18,038 | ||||||||||||
Total non-recourse notes payable | $ | 45,456 | $ | 52,874 | $ | 53,732 | $ | 44,080 |
COMMITMENTS AND CONTINGENCIES |
EARNINGS PER SHARE |
Three months ended December 31, | Nine months ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Basic and diluted common shares outstanding: | ||||||||||||||||
Weighted average common shares outstanding — basic | 7,280 | 7,230 | 7,260 | 7,351 | ||||||||||||
Effect of dilutive shares | 49 | 49 | 76 | 62 | ||||||||||||
Weighted average shares common outstanding — diluted | 7,329 | 7,279 | 7,336 | 7,413 | ||||||||||||
Calculation of earnings per common share - basic: | ||||||||||||||||
Net earnings | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,930 | ||||||||
Net earnings attributable to participating securities | - | - | - | 63 | ||||||||||||
Net earnings attributable to common shareholders | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,867 | ||||||||
Earnings per common share - basic | $ | 1.41 | $ | 2.14 | $ | 4.79 | $ | 5.02 | ||||||||
Calculation of earnings per common share - diluted: | ||||||||||||||||
Net earnings attributable to common shareholders— basic | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,867 | ||||||||
Add: undistributed earnings attributable to participating securities | - | - | - | 1 | ||||||||||||
Net earnings attributable to common shareholders— diluted | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,868 | ||||||||
Earnings per common share - diluted | $ | 1.40 | $ | 2.13 | $ | 4.74 | $ | 4.97 |
Three months ended June 30, | ||||||||
2016 | 2015 | |||||||
Net earnings attributable to common shareholders - basic and diluted | $ | 10,671 | $ | 8,814 | ||||
Basic and diluted common shares outstanding: | ||||||||
Weighted average common shares outstanding — basic | 7,033 | 7,225 | ||||||
Effect of dilutive shares | 75 | 76 | ||||||
Weighted average shares common outstanding — diluted | 7,108 | 7,301 | ||||||
Earnings per common share - basic | $ | 1.52 | $ | 1.22 | ||||
Earnings per common share - diluted | $ | 1.50 | $ | 1.21 |
STOCKHOLDERS’ EQUITY |
SHARE-BASED COMPENSATION |
Number of Shares | Weighted Average Grant- date Fair Value | |||||||
Nonvested April 1, 2015 | 176,514 | $ | 52.75 | |||||
Granted | 125,357 | $ | 81.76 | |||||
Vested | (95,321 | ) | $ | 48.79 | ||||
Forfeited | (2,321 | ) | $ | 64.06 | ||||
Nonvested December 31, 2015 | 204,229 | $ | 72.28 |
Number of Shares | Weighted Average Grant- date Fair Value | |||||||
Nonvested April 1, 2016 | 203,828 | $ | 72.33 | |||||
Granted | 57,499 | $ | 86.40 | |||||
Vested | (82,571 | ) | $ | 66.07 | ||||
Nonvested June 30, 2016 | 178,756 | $ | 79.75 |
INCOME TAXES |
FAIR VALUE OF FINANCIAL INSTRUMENTS |
Fair Value Measurement Using | ||||||||||||||||
Recorded Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||
December 31, 2015: | ||||||||||||||||
Assets: | ||||||||||||||||
Money market funds | $ | 9,505 | $ | 9,505 | $ | - | $ | - | ||||||||
Liabilities: | ||||||||||||||||
Contingent consideration | $ | 990 | $ | - | $ | - | $ | 990 |
Fair Value Measurement Using | Fair Value Measurement Using | |||||||||||||||||||||||||||||
Recorded Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Recorded Amount | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | |||||||||||||||||||||||
March 31, 2015: | ||||||||||||||||||||||||||||||
June 30, 2016 | ||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||
Money market funds | $ | 25,004 | $ | 25,004 | $ | - | $ | - | $ | 36,521 | $ | 36,521 | $ | - | $ | - | ||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||
Contingent consideration | $ | 1,119 | $ | - | $ | - | $ | 1,119 | ||||||||||||||||||||||
March 31, 2016 | ||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||
Money market funds | $ | 39,509 | $ | 39,509 | $ | - | $ | - | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||
Contingent consideration | $ | 1,830 | $ | - | $ | - | $ | 1,830 | $ | 1,041 | $ | - | $ | - | $ | 1,041 |
SEGMENT REPORTING |
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2015 | December 31, 2014 | June 30, 2016 | June 30, 2015 | |||||||||||||||||||||||||||||||||||||||||||||
Technology | Financing | Total | Technology | Financing | Total | Technology | Financing | Total | Technology | Financing | Total | |||||||||||||||||||||||||||||||||||||
Sales of product and services | $ | 287,859 | $ | - | $ | 287,859 | $ | 295,679 | $ | - | $ | 295,679 | $ | 290,181 | $ | - | $ | 290,181 | $ | 259,696 | $ | - | $ | 259,696 | ||||||||||||||||||||||||
Financing revenue | - | 9,289 | 9,289 | - | 8,406 | 8,406 | - | 6,987 | 6,987 | - | 8,346 | 8,346 | ||||||||||||||||||||||||||||||||||||
Fee and other income | 1,506 | (10 | ) | 1,496 | 2,140 | 16 | 2,156 | 1,276 | 59 | 1,335 | 1,811 | 13 | 1,824 | |||||||||||||||||||||||||||||||||||
Net sales | 289,365 | 9,279 | 298,644 | 297,819 | 8,422 | 306,241 | 291,457 | 7,046 | 298,503 | 261,507 | 8,359 | 269,866 | ||||||||||||||||||||||||||||||||||||
Cost of sales, product and services | 231,503 | - | 231,503 | 238,202 | - | 238,202 | 229,847 | - | 229,847 | 207,718 | - | 207,718 | ||||||||||||||||||||||||||||||||||||
Direct lease costs | - | 3,081 | 3,081 | - | 2,601 | 2,601 | - | 992 | 992 | - | 3,018 | 3,018 | ||||||||||||||||||||||||||||||||||||
Cost of sales | 231,503 | 3,081 | 234,584 | 238,202 | 2,601 | 240,803 | 229,847 | 992 | 230,839 | 207,718 | 3,018 | 210,736 | ||||||||||||||||||||||||||||||||||||
Professional and other fees | 1,608 | 274 | 1,882 | 1,158 | 278 | 1,436 | 1,497 | 289 | 1,786 | 1,262 | 256 | 1,518 | ||||||||||||||||||||||||||||||||||||
Salaries and benefits | 35,043 | 2,329 | 37,372 | 33,507 | 2,125 | 35,632 | 37,485 | 2,313 | 39,798 | 32,952 | 2,262 | 35,214 | ||||||||||||||||||||||||||||||||||||
General and administrative expenses | 6,530 | 235 | 6,765 | 6,918 | 315 | 7,233 | 6,231 | 239 | 6,470 | 5,325 | 246 | 5,571 | ||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 1,771 | 4 | 1,775 | 1,204 | 4 | 1,208 | ||||||||||||||||||||||||||||||||||||||||||
Interest and financing costs | 10 | 386 | 396 | 19 | 556 | 575 | - | 349 | 349 | 19 | 534 | 553 | ||||||||||||||||||||||||||||||||||||
Operating expenses | 43,191 | 3,224 | 46,415 | 41,602 | 3,274 | 44,876 | 46,984 | 3,194 | 50,178 | 40,762 | 3,302 | 44,064 | ||||||||||||||||||||||||||||||||||||
Operating income | 14,671 | 2,974 | 17,645 | 18,015 | 2,547 | 20,562 | ||||||||||||||||||||||||||||||||||||||||||
Earnings before tax | $ | 14,626 | $ | 2,860 | $ | 17,486 | $ | 13,027 | $ | 2,039 | $ | 15,066 | ||||||||||||||||||||||||||||||||||||
Other income | - | - | - | - | 6,169 | 6,169 | ||||||||||||||||||||||||||||||||||||||||||
Earnings before provision for income taxes | $ | 14,671 | $ | 2,974 | $ | 17,645 | $ | 18,015 | $ | 8,716 | $ | 26,731 | ||||||||||||||||||||||||||||||||||||
Selected Financial Data - Statement of Cash Flow | Selected Financial Data - Statement of Cash Flow | |||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and amortization | $ | 1,327 | $ | 3,078 | $ | 4,405 | $ | 1,244 | $ | 2,566 | $ | 3,810 | $ | 1,788 | $ | 987 | $ | 2,775 | $ | 1,237 | $ | 2,998 | $ | 4,235 | ||||||||||||||||||||||||
Purchases of property, equipment and operating lease equipment | $ | 506 | $ | 884 | $ | 1,390 | $ | 1,846 | $ | 3,774 | $ | 5,620 | $ | 652 | $ | 238 | $ | 890 | $ | 618 | $ | 6,306 | $ | 6,924 | ||||||||||||||||||||||||
Selected Financial Data - Balance Sheet | Selected Financial Data - Balance Sheet | |||||||||||||||||||||||||||||||||||||||||||||||
Total assets | $ | 401,422 | $ | 229,012 | $ | 630,434 | $ | 366,740 | $ | 224,625 | $ | 591,365 | $ | 450,992 | $ | 188,107 | $ | 639,099 | $ | 352,760 | $ | 227,625 | $ | 580,385 |
Nine Months Ended | ||||||||||||||||||||||||
December 31, 2015 | December 31, 2014 | |||||||||||||||||||||||
Technology | Financing | Total | Technology | Financing | Total | |||||||||||||||||||
Sales of product and services | $ | 871,814 | $ | - | $ | 871,814 | $ | 843,619 | $ | - | $ | 843,619 | ||||||||||||
Financing revenue | - | 27,914 | 27,914 | - | 26,339 | 26,339 | ||||||||||||||||||
Fee and other income | 5,038 | 30 | 5,068 | 5,969 | 90 | 6,059 | ||||||||||||||||||
Net sales | 876,852 | 27,944 | 904,796 | 849,588 | 26,429 | 876,017 | ||||||||||||||||||
Cost of sales, product and services | 700,429 | - | 700,429 | 681,852 | - | 681,852 | ||||||||||||||||||
Direct lease costs | - | 9,256 | 9,256 | - | 8,364 | 8,364 | ||||||||||||||||||
Cost of sales | 700,429 | 9,256 | 709,685 | 681,852 | 8,364 | 690,216 | ||||||||||||||||||
Professional and other fees | 4,175 | 738 | 4,913 | 4,065 | 781 | 4,846 | ||||||||||||||||||
Salaries and benefits | 101,471 | 6,855 | 108,326 | 96,140 | 6,691 | 102,831 | ||||||||||||||||||
General and administrative expenses | 20,381 | 748 | 21,129 | 19,379 | 1,285 | 20,664 | ||||||||||||||||||
Interest and financing costs | 51 | 1,320 | 1,371 | 77 | 1,753 | 1,830 | ||||||||||||||||||
Operating expenses | 126,078 | 9,661 | 135,739 | 119,661 | 10,510 | 130,171 | ||||||||||||||||||
Operating income | 50,345 | 9,027 | 59,372 | 48,075 | 7,555 | 55,630 | ||||||||||||||||||
Other income | - | - | - | - | 7,603 | 7,603 | ||||||||||||||||||
Earnings before provision for income taxes | $ | 50,345 | $ | 9,027 | $ | 59,372 | $ | 48,075 | $ | 15,158 | $ | 63,233 | ||||||||||||
Depreciation and amortization | $ | 3,728 | $ | 9,243 | $ | 12,971 | $ | 3,219 | $ | 8,222 | $ | 11,441 | ||||||||||||
Purchases of property, equipment and operating lease equipment | $ | 1,700 | $ | 15,308 | $ | 17,008 | $ | 2,932 | $ | 4,639 | $ | 7,571 | ||||||||||||
Total assets | $ | 401,422 | $ | 229,012 | $ | 630,434 | $ | 366,740 | $ | 224,625 | $ | 591,365 |
BUSINESS COMBINATIONS |
Acquisition Date Amount | ||||
(in millions) | ||||
Accounts receivable—trade, net | $ | 8,457 | ||
Property and equipment | 81 | |||
Identified intangible assets | 8,710 | |||
Accounts payable and other current liabilities | (8,641 | ) | ||
Deferred tax liability | (89 | ) | ||
Total identifiable net assets | 8,518 | |||
Goodwill | 8,131 | |||
Total purchase consideration | $ | 16,649 |
Estimated Useful Lives (in years) | Acquisition Date Amount | |||||||
Intangible assets—customer relationships | 7 | $ | 7,680 | |||||
Intangible assets—trade names | 10 | 520 | ||||||
Intangible assets—backlog | 1 | 510 | ||||||
Total identified intangible assets | $ | 8,710 |
Three Months Ended December 31, | Nine Months Ended December 31, | For the three months ended June 30, | ||||||||||||||||||||||||||||||
2015 | 2014 | Change | 2015 | 2014 | Change | 2016 | 2015 | |||||||||||||||||||||||||
Adjusted gross billings of product and services (1) | $ | 397,473 | $ | 332,308 | ||||||||||||||||||||||||||||
Gross margin | 21.5 | % | 21.4 | % | 10 bps | 21.6 | % | 21.2 | % | 40 bps | 22.7 | % | 21.9 | % | ||||||||||||||||||
Gross margin, product and services | 19.6 | % | 19.4 | % | 20 bps | 19.7 | % | 19.2 | % | 50 bps | 20.8 | % | 20.0 | % | ||||||||||||||||||
Operating income margin | 5.9 | % | 6.7 | % | (80 bps) | 6.6 | % | 6.4 | % | 20 bps | 5.9 | % | 5.6 | % | ||||||||||||||||||
Non-GAAP gross sales of product and services (1) | $ | 393,922 | $ | 377,262 | 4.4 | % | $ | 1,157,327 | $ | 1,094,958 | 5.7 | % | ||||||||||||||||||||
Non-GAAP gross cost of sales, product and services (1) | $ | 337,566 | $ | 319,785 | 5.6 | % | $ | 985,942 | $ | 933,191 | 5.7 | % | ||||||||||||||||||||
Non-GAAP: Net earnings (2) | $ | 11,381 | $ | 9,146 | ||||||||||||||||||||||||||||
Non-GAAP: Net earnings per common share - diluted (2) | $ | 1.54 | $ | 1.25 | ||||||||||||||||||||||||||||
Adjusted EBITDA (2) | $ | 18,976 | $ | 21,779 | (12.9 | %) | $ | 63,111 | $ | 58,768 | 7.4 | % | ||||||||||||||||||||
Adjusted EBITDA margin (2) | 6.4 | % | 7.1 | % | (70 bps) | 7.0 | % | 6.7 | % | 30 bps | ||||||||||||||||||||||
Adjusted EBITDA (3) | $ | 19,261 | $ | 16,274 | ||||||||||||||||||||||||||||
Adjusted EBITDA margin (3) | 6.5 | % | 6.0 | % | ||||||||||||||||||||||||||||
Purchases of property and equipment used internally | $ | 504 | $ | 1,846 | $ | (1,342 | ) | $ | 1,698 | $ | 2,932 | $ | (1,234 | ) | $ | 652 | $ | 618 | ||||||||||||||
Purchases of equipment under operating leases | 5,328 | 3,774 | 1,554 | 19,752 | 4,639 | 15,113 | 238 | 6,306 | ||||||||||||||||||||||||
Total capital expenditures | $ | 5,832 | $ | 5,620 | $ | 212 | $ | 21,450 | $ | 7,571 | $ | 13,879 | $ | 890 | $ | 6,924 |
(1) | We define |
Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Sales of products and services | $ | 287,859 | $ | 295,679 | $ | 871,814 | $ | 843,619 | ||||||||
Costs incurred related to sales of third party software assurance, maintenance and services | �� | 106,063 | $ | 81,583 | 285,513 | $ | 251,339 | |||||||||
Non-GAAP gross sales of products and services | $ | 393,922 | $ | 377,262 | $ | 1,157,327 | $ | 1,094,958 | ||||||||
Cost of sales, product and services | $ | 231,503 | $ | 238,202 | $ | 700,429 | $ | 681,852 | ||||||||
Costs incurred related to sales of third party software assurance, maintenance and services | 106,063 | 81,583 | 285,513 | 251,339 | ||||||||||||
Non-GAAP gross cost of sales, product and services | $ | 337,566 | $ | 319,785 | $ | 985,942 | $ | 933,191 |
For the three months ended June 30, | ||||||||
2016 | 2015 | |||||||
Sales of products and services | $ | 290,181 | $ | 259,696 | ||||
Costs incurred related to sales of third party services | 107,292 | 72,612 | ||||||
Adjusted gross billings of product and services | $ | 397,473 | $ | 332,308 |
(2) | Non-GAAP net earnings per common share are based on net earnings calculated in accordance with GAAP, adjusted to exclude other income and acquisition related amortization expense, and related effects on income tax. Non-GAAP provision for income taxes is calculated based on the effective tax rate for the non-GAAP adjustments for the quarter ended June 30, 2016. For comparative purposes, the non-GAAP provision for income tax for the three months ended June 30, 2016, excludes the tax benefit of the $0.4 million associated with the adoption of the stock compensation accounting standard. We use Non-GAAP net earnings per common share as a supplemental measure of our performance to gain insight into our operating performance. We believe that the exclusion of other income and acquisition related amortization expense in calculating Non-GAAP net earnings per common share provides management and investors a useful measure for period-to-period comparisons of our core business and operating results by excluding items that are not comparable across reporting periods. Accordingly, we believe that non-GAAP net earnings per common share provide useful information to investors and others in understanding and evaluating our operating results. However, our use of Non-GAAP net earnings per common share as analytical tools has limitations, and you should not consider them in isolation or as substitutes for analysis of our financial results as reported under GAAP. In addition, other companies, including companies in our industry, might calculate Non-GAAP net earnings per common share or similarly titled measures differently, which may reduce their usefulness as comparative measures. |
For the three months ended June 30, | ||||||||
2016 | 2015 | |||||||
GAAP: Earnings before tax | $ | 17,486 | $ | 15,066 | ||||
Plus: Acquisition related amortization expense | 1,089 | 568 | ||||||
Non-GAAP: Earnings before provision for income taxes | 18,575 | 15,634 | ||||||
Non-GAAP: Provision for income taxes | 7,616 | 6,488 | ||||||
Non-GAAP: Net earnings | $ | 10,954 | $ | 9,146 | ||||
GAAP: Net earnings per common share - diluted | $ | 1.50 | $ | 1.21 | ||||
Non-GAAP: Net earnings per common share - diluted | $ | 1.54 | $ | 1.25 |
We define Adjusted EBITDA as net earnings calculated in accordance with GAAP, adjusted for the following: interest expense, depreciation and amortization, provision for income taxes, and other income. We consider the interest on notes payable from our financing segment and depreciation expense presented within cost of sales, which includes depreciation on assets financed as operating leases, to be operating expenses. As such, they are not included in the amounts added back to net earnings in the Adjusted EBITDA calculation. We provide below a reconciliation of Adjusted EBITDA to net earnings, which is the most directly comparable financial measure to this non-GAAP financial measure. Adjusted EBITDA margin is our calculation of Adjusted EBITDA divided by net sales. |
Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||
Net earnings | $ | 10,297 | $ | 15,501 | $ | 34,790 | $ | 36,930 | ||||||||
Provision for income taxes | 7,348 | 11,230 | 24,582 | 26,303 | ||||||||||||
Depreciation and amortization | 1,331 | 1,217 | 3,739 | 3,138 | ||||||||||||
Less: Other income | - | 6,169 | - | 7,603 | ||||||||||||
Adjusted EBITDA | $ | 18,976 | $ | 21,779 | $ | 63,111 | $ | 58,768 |
Three months ended June 30, | |||||
2016 | 2015 | ||||
GAAP: Net earnings | $ 10,671 | $ 8,814 | |||
Plus: Provision for income taxes | 6,815 | 6,252 | |||
Plus: Depreciation and amortization | 1,775 | 1,208 | |||
Non-GAAP: Adjusted EBITDA | $ 19,261 | $ 16,274 | |||
Technology Segment | |||||
Earnings before tax | $ 14,626 | $ 13,027 | |||
Plus: Depreciation and amortization | 1,771 | 1,204 | |||
Non-GAAP: Adjusted EBITDA | $ 16,397 | $ 14,231 | |||
Financing Segment | |||||
Earnings before tax | $ 2,860 | $ 2,039 | |||
Plus: Depreciation and amortization | 4 | 4 | |||
Non-GAAP: Adjusted EBITDA | $ 2,864 | $ 2,043 |
· | Portfolio income: Interest income from financing receivables and rents due under operating leases; |
· | Transactional gains: Net gains or losses on the sale of financial assets; and |
· | Post-contract earnings: Month-to-month rents; early termination, prepayment, make-whole, or buyout fees; and net gains on the sale of off-lease (used) equipment. |
Three Months Ended December 31, | Nine Months Ended December 31, | For the three months ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2015 | 2014 | Change | 2015 | 2014 | Change | 2016 | 2015 | Change | ||||||||||||||||||||||||||||||||||||||||
Sales of product and services | $ | 287,859 | $ | 295,679 | $ | (7,820 | ) | (2.6 | %) | $ | 871,814 | $ | 843,619 | $ | 28,195 | 3.3 | % | $ | 290,181 | $ | 259,696 | $ | 30,485 | 11.7 | % | |||||||||||||||||||||||
Fee and other income | 1,506 | 2,140 | (634 | ) | (29.6 | %) | 5,038 | 5,969 | (931 | ) | (15.6 | %) | 1,276 | 1,811 | (535 | ) | (29.5 | %) | ||||||||||||||||||||||||||||||
Net sales | 289,365 | 297,819 | (8,454 | ) | (2.8 | %) | 876,852 | 849,588 | 27,264 | 3.2 | % | 291,457 | 261,507 | 29,950 | 11.5 | % | ||||||||||||||||||||||||||||||||
Cost of sales, product and services | 231,503 | 238,202 | (6,699 | ) | (2.8 | %) | 700,429 | 681,852 | 18,577 | 2.7 | % | 229,847 | 207,718 | 22,129 | 10.7 | % | ||||||||||||||||||||||||||||||||
Gross profit | 57,862 | 59,617 | (1,755 | ) | (2.9 | %) | 176,423 | 167,736 | 8,687 | 5.2 | % | 61,610 | 53,789 | 7,821 | 14.5 | % | ||||||||||||||||||||||||||||||||
Professional and other fees | 1,608 | 1,158 | 450 | 38.9 | % | 4,175 | 4,065 | 110 | 2.7 | % | 1,497 | 1,262 | 235 | 18.6 | % | |||||||||||||||||||||||||||||||||
Salaries and benefits | 35,043 | 33,507 | 1,536 | 4.6 | % | 101,471 | 96,140 | 5,331 | 5.5 | % | 37,485 | 32,952 | 4,533 | 13.8 | % | |||||||||||||||||||||||||||||||||
General and administrative | 6,530 | 6,918 | (388 | ) | (5.6 | %) | 20,381 | 19,379 | 1,002 | 5.2 | % | 6,231 | 5,325 | 906 | 17.0 | % | ||||||||||||||||||||||||||||||||
Depreciation and amortization | 1,771 | 1,204 | 567 | 47.1 | % | |||||||||||||||||||||||||||||||||||||||||||
Interest and financing costs | 10 | 19 | (9 | ) | (47.4 | %) | 51 | 77 | (26 | ) | (33.8 | %) | - | 19 | 19 | (100.0 | %) | |||||||||||||||||||||||||||||||
Operating expenses | 43,191 | 41,602 | 1,589 | 3.8 | % | 126,078 | 119,661 | 6,417 | 5.4 | % | 46,984 | 40,762 | 6,222 | 15.3 | % | |||||||||||||||||||||||||||||||||
Segment earnings | $ | 14,671 | $ | 18,015 | $ | (3,344 | ) | (18.6 | %) | $ | 50,345 | $ | 48,075 | $ | 2,270 | 4.7 | % | $ | 14,626 | $ | 13,027 | $ | 1,599 | 12.3 | % | |||||||||||||||||||||||
Adjusted EBITDA | $ | 16,397 | $ | 14,231 | $ | 2,166 | 15.2 | % |
Quarter Ended | Sequential | Year over Year | ||||||
June 30, 2016 | (0.5 | %) | 11.7 | % | ||||
March 31, 2016 | 1.3 | % | 13.3 | % | ||||
December 31, 2015 | (11.2 | %) | (2.6 | %) | ||||
September 30, 2015 | 24.9 | % | 13.1 | % | ||||
June 30, 2015 | 0.9 | % | (0.6 | %) |
Quarter Ended | Sequential | Year over Year | ||||||
December 31, 2015 | (2.6 | %) | (11.2 | %) | ||||
September 30, 2015 | 24.9 | % | 13.1 | % | ||||
June 30,2015 | 0.9 | % | (0.6 | %) | ||||
March 31, 2015 | (13.0 | %) | 3.2 | % | ||||
December 31, 2014 | 3.2 | % | 15.6 | % |
For the twelve months ended June 30, | ||||||||||||
2016 | 2015 | Change | ||||||||||
Revenue by customer end market: | ||||||||||||
SLED | 22 | % | 23 | % | (1 | %) | ||||||
Technology | 22 | % | 20 | % | 2 | % | ||||||
Telecom, Media & Entertainment | 14 | % | 18 | % | (4 | %) | ||||||
Healthcare | 11 | % | 10 | % | 1 | % | ||||||
Financial Services | 12 | % | 10 | % | 2 | % | ||||||
Other | 19 | % | 19 | % | 0 | % | ||||||
Total | 100 | % | 100 | % | ||||||||
Revenue by vendor: | ||||||||||||
Cisco Systems | 49 | % | 50 | % | (1 | %) | ||||||
HP Inc. & HPE | 6 | % | 8 | % | (2 | %) | ||||||
NetApp | 5 | % | 6 | % | (1 | %) | ||||||
Sub-total | 60 | % | 64 | % | (4 | %) | ||||||
Other | 40 | % | 36 | % | 4 | % | ||||||
Total | 100 | % | 100 | % |
Three Months Ended December 31, | Nine Months Ended December 31, | For the three months ended June 30, | ||||||||||||||||||||||||||||||||||||||||||||||
2015 | 2014 | Change | 2015 | 2014 | Change | 2016 | 2015 | Change | ||||||||||||||||||||||||||||||||||||||||
Financing revenue | $ | 9,289 | $ | 8,406 | $ | 883 | 10.5 | % | $ | 27,914 | $ | 26,339 | $ | 1,575 | 6.0 | % | $ | 6,987 | $ | 8,346 | $ | (1,359 | ) | (16.3 | %) | |||||||||||||||||||||||
Fee and other income | (10 | ) | 16 | (26 | ) | (162.5 | %) | 30 | 90 | (60 | ) | (66.7 | %) | 59 | 13 | 46 | 353.8 | % | ||||||||||||||||||||||||||||||
Net sales | 9,279 | 8,422 | 857 | 10.2 | % | 27,944 | 26,429 | 1,515 | 5.7 | % | 7,046 | 8,359 | (1,313 | ) | (15.7 | %) | ||||||||||||||||||||||||||||||||
Direct lease costs | 3,081 | 2,601 | 480 | 18.5 | % | 9,256 | 8,364 | 892 | 10.7 | % | 992 | 3,018 | (2,026 | ) | (67.1 | %) | ||||||||||||||||||||||||||||||||
Gross profit | 6,198 | 5,821 | 377 | 6.5 | % | 18,688 | 18,065 | 623 | 3.4 | % | 6,054 | 5,341 | 713 | 13.3 | % | |||||||||||||||||||||||||||||||||
Professional and other fees | 274 | 278 | (4 | ) | (1.4 | %) | 738 | 781 | (43 | ) | (5.5 | %) | 289 | 256 | 33 | 12.9 | % | |||||||||||||||||||||||||||||||
Salaries and benefits | 2,329 | 2,125 | 204 | 9.6 | % | 6,855 | 6,691 | 164 | 2.5 | % | 2,313 | 2,262 | 51 | 2.3 | % | |||||||||||||||||||||||||||||||||
General and administrative | 235 | 315 | (80 | ) | (25.4 | %) | 748 | 1,285 | (537 | ) | (41.8 | %) | 239 | 246 | (7 | ) | (2.8 | %) | ||||||||||||||||||||||||||||||
Depreciation and amortization | 4 | 4 | - | 0.0 | % | |||||||||||||||||||||||||||||||||||||||||||
Interest and financing costs | 386 | 556 | (170 | ) | (30.6 | %) | 1,320 | 1,753 | (433 | ) | (24.7 | %) | 349 | 534 | (185 | ) | (34.6 | %) | ||||||||||||||||||||||||||||||
Operating expenses | 3,224 | 3,274 | (50 | ) | (1.5 | %) | 9,661 | 10,510 | (849 | ) | (8.1 | %) | 3,194 | 3,302 | (108 | ) | (3.3 | %) | ||||||||||||||||||||||||||||||
Operating income | 2,974 | 2,547 | 427 | 16.8 | % | 9,027 | 7,555 | 1,472 | 19.5 | % | ||||||||||||||||||||||||||||||||||||||
Other income | - | 6,169 | (6,169 | ) | n/a | - | 7,603 | (7,603 | ) | n/a | ||||||||||||||||||||||||||||||||||||||
Segment earnings | $ | 2,974 | $ | 8,716 | $ | (5,742 | ) | (65.9 | %) | $ | 9,027 | $ | 15,158 | $ | (6,131 | ) | (40.4 | %) | $ | 2,860 | $ | 2,039 | $ | 821 | 40.3 | % | ||||||||||||||||||||||
Adjusted EBITDA | $ | 2,864 | $ | 2,043 | $ | 821 | 40.2 | % |
Nine Months Ended December 31, | Three months ended June 30, | |||||||||||||||
2015 | 2014 | 2016 | 2015 | |||||||||||||
Net cash used in operating activities | $ | (18,876 | ) | $ | (9,930 | ) | ||||||||||
Net cash (used in) provided by operating activities | $ | (12,719 | ) | $ | 21,756 | |||||||||||
Net cash used in investing activities | (44,344 | ) | (31,705 | ) | (17,510 | ) | (26,425 | ) | ||||||||
Net cash provided by financing activities | 53,638 | 13,002 | 13,953 | 17,272 | ||||||||||||
Effect of exchange rate changes on cash | (26 | ) | (24 | ) | 317 | 3 | ||||||||||
Net Decrease in Cash and Cash Equivalents | $ | (9,608 | ) | $ | (28,657 | ) | ||||||||||
Net increase (decrease) in cash and cash equivalents | $ | (15,959 | ) | $ | 12,606 |
As of December 31, | As of June 30, | |||||||||||||||
2015 | 2014 | 2016 | 2015 | |||||||||||||
Days sales outstanding (1) | 56 | 51 | 54 | 54 | ||||||||||||
Days inventory outstanding (2) | 6 | 7 | 10 | 8 | ||||||||||||
Days payable outstanding (3) | (42 | ) | (40 | ) | (46 | ) | (45 | ) | ||||||||
Cash conversion cycle | 20 | 18 | 18 | 17 |
(1) | Represents the rolling three-month average of the balance of trade accounts receivable-trade, net for our Technology segment at the end of the period divided by |
(2) | Represents the rolling three-month average of the balance of inventory, net for our Technology segment at the end of the period divided by |
(3) | Represents the rolling three-month average of the combined balance of accounts payable-trade and accounts payable-floor plan for our Technology segment at the end of the period divided by |
Maximum Credit Limit at December 31, 2015 | Balance as of December 31, 2015 | Maximum Credit Limit at March 31,2015 | Balance as of March 31, 2015 | |||||||||||||||||||||||||
Maximum Credit Limit at June 30, 2016 | Maximum Credit Limit at June 30, 2016 | Balance as of June 30, 2016 | Maximum Credit Limit at March 31, 2016 | Balance as of March 31, 2016 | ||||||||||||||||||||||||
$ | 250,000 | $ | 127,999 | $ | 225,000 | $ | 99,418 | 250,000 | $ | 144,509 | $ | 250,000 | $ | 121,893 |
PART II. | OTHER INFORMATION |
Period | Total number of shares purchased (1) | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs | ||||||||||||||
April 1, 2015 through April 30, 2015 | - | - | 351,960 | (2 | ) | |||||||||||||
May 1, 2015 through May 31, 2015 | - | - | 351,960 | (3 | ) | |||||||||||||
June 1, 2015 through June 15, 2015 | 18,284 | $ | 82.63 | - | 351,960 | (4 | ) | |||||||||||
June 16, 2015 through August 16, 2015 | 12,163 | $ | 79.32 | - | - | (5 | ) | |||||||||||
August 17, 2015 through August 31, 2015 | - | n/a | - | 500,000 | (6 | ) | ||||||||||||
September 1, 2015 through September 30, 2015 | - | n/a | - | 500,000 | (7 | ) | ||||||||||||
October 1, 2015 through October 31, 2015 | - | n/a | - | 500,000 | (8 | ) | ||||||||||||
November 1, 2015 through November 30, 2015 | - | n/a | - | 500,000 | (9 | ) | ||||||||||||
December 1, 2015 through December 31, 2015 | - | n/a | - | 500,000 | (10 | ) |
Period | Total number of shares purchased (1) | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Maximum number (or approximate dollar value) of shares that may yet be purchased under the plans or programs | ||||||||||||
April 1, 2016 through April 30, 2016 | 113,035 | $ | 80.70 | 113,035 | 270,663 | (2) | ||||||||||
May 1, 2016 through May 31, 2016 | 78,659 | $ | 81.59 | 78,659 | 192,004 | (3) | ||||||||||
June 1, 2016 through June 30, 2016 | 64,834 | $ | 84.78 | 35,098 | 156,906 | (4) |
(1) | All shares acquired were in open-market purchases, except for 29,736 shares, which were repurchased in June 2016 to satisfy tax withholding obligations that arose due to the vesting of shares of restricted stock. |
(2) | The share purchase authorization in place for the month ended April 30, |
(3) | The share purchase authorization in place for the month ended May 31, |
(4) | The share purchase authorization |
10.1 | Amended and Restated Employment Agreement between ePlus inc. and Mark P. Marron, effective August 1, 2016 (Incorporated herein by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on July 27, 2016). |
10.2 | Employment Agreement between ePlus inc. and Phillip G. Norton, effective August 1, 2016 (Incorporated herein by reference to Exhibit 10.2 to our Current Report on Form 8-K filed on July 27, 2016). |
10.3 | Amended and Restated Employment Agreement between ePlus inc. and Elaine D. Marion, effective August 1, 2016 (Incorporated herein by reference to Exhibit 10.3 to our Current Report on Form 8-K filed on July 27, 2016). |
10.4 | Amendment No. 4, dated July 28, 2016, to Amended and Restated Agreement for Wholesale Financing between ePlus Technology, inc. and Wells Fargo Commercial Distribution Finance, LLC (Incorporated herein by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on August 1, 2016). |
10.5 | Amendment No. 4, dated July 28, 2016, to Amended and Restated Business Financing Agreement between ePlus Technology, inc. and Wells Fargo Commercial Distribution Finance, LLC (Incorporated herein by reference to Exhibit 10.2 to our Current Report on Form 8-K filed on August 1, 2016). |
Certification of the Chief Executive Officer of ePlus inc. pursuant to the Securities Exchange Act Rules 13a-14(a) and 15d-14(a). | |
Certification of the Chief Financial Officer of ePlus inc. pursuant to the Securities Exchange Act Rules 13a-14(a) and 15d-14(a). | |
Certification of the Chief Executive Officer and Chief Financial Officer of ePlus inc. pursuant to 18 U.S.C. § 1350. | |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema Document |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
ePlus inc. | ||
Date: | /s/ | |
By: | ||
Chief Executive Officer and President | ||
(Principal Executive Officer) | ||
Date: | /s/ ELAINE D. MARION | |
By: Elaine D. Marion | ||
Chief Financial Officer | ||
(Principal Financial Officer) |