| Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | 1. Organization , Basis of Presentation , and Summary of Significant Accounting Policies Organization Landec Corporation and its subsidiaries (“ Landec” or the “Company”) design, develop, manufacture , and sell differentiated products for food and biomaterials markets , and license technology applications to partners. The Company has two 1 2 , and foodservice operators, primarily in the United States, Canada , and Asia through its Apio, Inc. (“Apio”) subsidiary , and sells HA-based and non-HA biomaterials through its Lifecore Biomedical, Inc. (“Lifecore”) subsidiary. The Company’s HA biopolymers and non-HA materials are proprietary in that they are specially formulated for specific customers to meet strict regulatory requirements. Through its O Olive Oil and Vinegar (“O Olive”) division, which the Company acquired on March 1, 2017, The Company ’s technologies, along with its customer relationships and tradenames , are the foundation and key differentiating advantages upon which Landec has built its business. Basis of Presentation The accompanying unaudited consolidated financial statements of Landec have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions for Form 10 10 X. February 25, 2018 not 10 May 28, 2017 . The results of operations for the nine February 25, 2018 not may , and the order patterns of Lifecore’s customers which may Basis of Consolidation The consolidated financial statements are presented on the accrual basis of accounting in accordance with GAAP and include the accounts of Landec Corporation and its subsidiaries, Apio and Lifecore. All intercompany transactions and balances have been eliminated. Arrangements that are not VIEs”). A company is required to consolidate the assets, liabilities , and operations of a VIE if it is determined to be the primary beneficiary of the VIE. An entity is a VIE and subject to consolidation, if by design: a) the total equity investment at risk is not sufficient to permit the entity to finance its activities without additional subordinated financial support provided by any party, including equity holders , or b) as a group the holders of the equity investment at risk lack any one three not Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make certain estimates and judgments that affect the amounts reported in the financial statements and accompanying notes. The accounting estimates that require management’s most significant and subjective judgments include revenue recognition; loss contingencies; sales returns and allowances; inventories; self-insurance liabilities; recognition and measurement of current and deferred income tax assets and liabilities; the assessment of recoverability of long-lived assets including intangible assets; the valuation of investments; and the valuation and recognition of stock-based compensation and contingent liabilities . These estimates involve the consideration of comple x may C ash and Cash Equivalents The Company records all highly liquid securities with three mates their historical cost given their short-term nature. Inventories Inventories are stated at the lower of cost ( first first February 25 , 2018 May 28, 2017 Raw materials $ 13,512 $ 10,158 Work in progress 3,756 3,447 Finished goods 11,481 11,685 Total $ 28,749 $ 25,290 If the cost of the inventories exceeds their net realizable value, provisions are recorded currently to reduce them to net realizable value. The Company also records a provision for slow moving and obsolete inventories based on the estimate of demand for its products. Related Party Transactions The Company sells products to and earns license fees from Windset Holdings 2010 three February 25, 2018 February 26, 2017, $104 ,000 $72 ,000, nine February 25, 2018 February 26, 2017, $299 ,000 $265 ,000, $144 ,000 $388,000 February 25, 2018 May 28, 2017, All related party transactions are monitored quarterly by the Company and approved by the Audit Committee of the Board of Directors. Debt Issuance Costs The Company records its line of credit debt issuance costs as an asset, and as such, $120,000 $3 08 ,000 , and other assets, respectively, as of February 25, 2018, $120,000 $399,000, May 28, 2017. $60,000 $155 ,000 , and long-term debt, net, respectively, as of February 25, 2018 $60,000 $201,000, May 28, 2017 . See Note 7 Financial Instruments The Company ’s financial instruments are primarily composed of commercial-term trade payables, grower advances, notes receivable , and debt instruments. For short-term instruments, the historical carrying amount approximates the fair value of the instrument. The fair value of long-term debt approximates its carrying value . Cash Flow Hedges The Company entered into an interest rate swap agreement to manage interest rate risk. This derivative instrument may For derivative instruments that hedge the exposure to variability in expected future cash flows that are designated as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of Accumulated Other Comprehensive Income in Stockholders’ Equity and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of the gain or loss on the derivative instrument, if any, is recognized in earnings in the current period. To receive hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions. Other Comprehensive Income Comprehensive i ncome consists of two Unrealized Gains on Cash Flow Hedge Accumulated OCI, net, as of May 28, 2017 $ 432 Other comprehensive income before reclassifications, net of tax effect 483 Amounts reclassified from OCI — Accumulated OCI, net, as of February 25, 2018 $ 915 The Company does not or losses into earnings in the next 12 Investment in Non-Public Company On Februa ry 15, 2011, February 25, 2018 May 28, 2017. 3 Intangible Assets The Company ’s intangible assets are comprised of customer relationships with a finite estimated useful life of eleven thirteen , and trademarks, tradenames and goodwill with indefinite useful lives. Finite-lived intangible assets are reviewed for possible impairment whenever events or changes in circumstances occur that indicate that the carrying amount of an a sset (or asset group) may not 350 30 35. Partial Self-Insurance on Employee Health and Workers Compensation Plans The Company provides health insurance benefits to eligible employees under self-insured plans whereby the Company pays actual medical claims subject to certain stop loss limits and self-insures its workers compensation claims. The Company records self-insurance liabilities based on actual claims filed and an estimate of those claims incurred but not not February 25, 2018 May 28, 2017. may Fair Value Measurements The Company uses fair value measurement accounting for financial assets and liabilities and for financial instruments and certain other items measured at fair value. The Company has elected the fair value option for it s investment in a non-public company. See Note 3 2 not The accounting guidance established a three Level 1 – observable inputs such as quoted prices for identical instruments in active markets. Level 2 – inputs other than quoted prices in active markets that are observable either directly or indirectly through corroboration with observable market data. Level 3 – unobservable inputs in which there is little or no As of February 25, 2018 May 28, 2017, . The fair value of the Company ’s interest rate swap is determined based on model inputs that can be observed in a liquid market, including yield curves, and is categorized as a Level 2 . The fair value of the Company ’s contingent consideration for the acquisition of O Olive utilizes significant unobservable inputs, including projected earnings before interest, taxes, depreciation and amortization (“EBITDA”) and discount rates. As a result, the Company’s contingent consideration associated with the O Olive acquisition is considered a Level 3 nine February 25, 2018, $5.9 May 28, 2017 $5.4 February 25, 2018 three May 31, 2020. The Company has elected the fair value option of accounting for its investment in Windset. The calculation of fair value utilizes significant unobservable inputs, including projected cash flows, gro wth rates , and discount rates. As a result, the Company’s investment in Windset is considered to be a Level 3 nine February 25, 2018 26.9% At February 25, 2018 At May 28, 2017 Revenue growth rates 6% 4% Expense growth rates 5% to 6% 4% Income tax rates 15% 15% Discount rates 12% 12% The revenue growth, expense growth , and income tax rate assumptions are considered the Company's best estimate of the trends in those items over the discount period. The discount rate assumption takes into account the risk-free rate of return, the market equity risk premium , and the company’s specific risk premium and then applies an additional discount for lack of liquidity of the underlying securities. The discounted cash flow valuation model used by the Company has the following sensitivity to changes in inputs and assumptions (in thousands): Impact on value of investment in Windset as of February 25, 2018 10% increase in revenue growth rates $ 9,400 10% increase in expense growth rates $ (8,800 ) 10% increase in income tax rates $ (500 ) 10% increase in discount rates $ (4,200 ) Imprecision in estimating unobservable market inputs can affect the amount of gain or loss recorded for a particular position. The use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. The following table summarizes the fair value of the Company’s assets and liabilities that are measured at fair value on a recurring basis (in thousands): Fair Value at February 25, 2018 Fair Value at May 28, 2017 Assets (liabilities): Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Interest rate swap (1) $ — $ 1,467 $ — $ — $ 688 $ — Investment in non-public company — — 65,800 — — 63,600 Contingent consideration liability (2) — — (5,400 ) — — (5,900 ) Total $ — $ 1,467 $ 60,400 $ — $ 688 $ 57,700 ( 1 Included in Other assets in the accompanying consolidated balance sheets. ( 2 Included in Other non-current liabilities in the accompanying consolidated balance sheets. Revenue Recognition See Note 9 four . Revenue from product sales is recognized when there is persuasive evidence that an arrangement exists, title has transferred, the price is fixed and determinable, and collectability is reasonably assured. Allowances are established for estimated uncollect ible amounts, product returns, and discounts based on specific identification and historical losses. Apio ’s Packaged Fresh Vegetables revenues generally consist of revenues generated from the sale of specialty packaged fresh-cut and whole value-added vegetable products that are generally washed and packaged in Apio’s proprietary packaging and sold under Apio’s Eat Smart and GreenLine brands and various private labels. Revenue is generally recognized upon shipment of these products to customers. The Company takes title to all produce it trades and/or packages, and therefore, records revenues and cost of sales at gross amounts in the accompanying Consolidated Statements of Comprehensive Income. In addition, Packaged Fresh Vegetables revenues include the re venues generated from Apio Cooling, LP, a vegetable cooling operation in which Apio is the general partner with a 60% Apio ’s Food Export revenues consist of revenues generated from the purchase and sale of primarily whole commodity fruit and vegetable products to Asia through its subsidiary, Cal-Ex Trading Company (“Cal-Ex”). As most Cal-Ex customers are in countries outside of the U.S., title transfers and revenue is generally recognized upon arrival of the shipment in the foreign port. Apio records revenue equal to the sale price to third 28, 2018, 27, 2018. Lifecore ’s Biomaterials business principally generates revenue through the sale of products containing HA. Lifecore primarily sells products to customers in three 1 65% 2017, 2 15% 2017, 3 20% 2017. Lifecore ’s business development revenues, a portion of which are included in all three O Olive ’s business, which the Company acquired on March 1, 2017, Contract R&D revenue is recorded as earned, based on the performance requirements of the contract. Non-refundable contract fees for which no s no For sales arrangements that contain multiple elements, the Company splits the arrangement into separate uni ts of accounting if the individually delivered elements have value to the customer on a standalone basis. The Company also evaluates whether multiple transactions with the same customer or related party should be considered part of a multiple element arrangement, whereby the Company assesses, among other factors, whether the contracts or agreements are negotiated or executed within a short time frame of each other or if there are indicators that the contracts are negotiated in contemplation of each other. The Company then allocates revenue to each element based on a selling price hierarchy. The relative selling price for a deliverable is based on its vendor-specific objective evidence (“VSOE”), if available, third not not The Company limits the amount of revenue recognition for delivered elements to the amount that is not of products or services or future performance obligations or subject to customer-specific cancellation rights. The Company evaluates each deliverable in an arrangement to determine whether it represents a separate unit of accounting. A deliverable constitutes a separate unit of accounting when it has stand-alone value, and for an arrangement that includes a general right of return relative to the delivered products or services, delivery or performance of the undelivered product or service is considered probable and is substantially controlled by the Company. The Company considers a deliverable to have stand-alone value if the product or service is sold separately by the Company or another vendor or could be resold by the customer. Further, the revenue arrangements generally do not not not For licensing revenue, the initial license fees are deferred and amortized to revenue over the period of the agreement when a contract exists, the fee is fixed and determinable, and collectability is reasonably assured. Noncancellable, nonrefundable license fees are recognized over the period of the agreement, including those governing R&D activities and any related supply agreement entered into concurrently with the license when the risk associated with commercialization of a product is non-substantive at the outset of the arrangement. From time to time, the Company offers customers sales incentives, which include volume rebates and discounts. These amounts are est imated on a quarterly basis and recorded as a reduction of revenue. A summary of revenues by type of arrangement as described above is as follows (in thousands): Three Months Ended Nine Months Ended February 25, 2018 February 26, 2017 February 25, 2018 February 26, 2017 Recorded upon shipment $ 141,575 $ 125,765 $ 373,486 $ 339,917 Recorded upon acceptance in foreign port 4,414 7,276 25,982 56,316 Revenue from multiple element arrangements 1,528 2,624 5,230 5,892 Revenue from license fees, R&D contracts and royalties/profit sharing 1,806 903 4,439 2,702 Total $ 149,323 $ 136,568 $ 409,137 $ 404,827 Legal Contingencies In the ordinary course of business, the Company is involved in various legal proceedings and claims. The Company makes a provision for a liability relating to legal matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These provisions are reviewed at least each fiscal quarter and adju sted to reflect the impacts of negotiations, estimate settlements, legal rulings, advice of legal counsel and other information and events pertaining to a particular matter. Legal fees are expensed in the period in which they are incurred. Apio has been the target of a union organizing campaign which has included two 100 100 The legal actions consisted of three 1 2 3 two 100 A settlement of the ULPs among the union, Apio, and Pacific Harvest that were pending before the NLRB was approved on December 27, 2016 $310,000. $155,000. May 5, 2017, settlement agreement concerning the discrimination/wrongful termination claims and the wage and hour claims which covers all non-exempt employees of Pacific Harvest working at Apio's Guadalupe, California processing facility from September 2011 $6.0 three $2.4 July 3, 2017, $1.8 November 22, 2017 $1.8 July 2018. one first two $4.2 $2.1 December 2020. one third July 2018. As of February 25, 2018 May 28, 2017, $1 .0 $3.2 . Recent Accounting Guidance Not Revenue Recognition In May 2014, 2014 09, 606 , Revenue from Contracts with Customers 605, Revenue Recognition 2014 09” five 2014 09. first 2019 Currently, the Company is in the process of evaluating the impact of the adoption of ASU 2014 09. ● Finished goods product sales (Packaged Fresh Vegetables and O Olive); ● Shipping and handling (Packaged Fresh Vegetables and O Olive); ● Product development and contract manufacturing arrangements (Biomaterials). The Company ’s assessment efforts to date have included reviewing current accounting policies, processes, and systems requirements, as well assigning internal resources and third 2014 09. 2014 09 2014 09 Currently, the Company cannot reasonably estimate the impact the application of ASU 2014 09 d financial statements. The Company continues to assess the impact of ASU 2014 09, may Leases In February 2016, 2016 02, Leases (Topic 842 2016 02” 2016 02 2016 02 first 2020 . The Company is currently in the process of evaluating the impact that ASU 2016 02 ’s assessment efforts to date have included: ● Reviewing the provisions of ASU 2016 02; ● Gathering information to evaluate its lease population and portfolio; ● Evaluating the nature of its real and personal property and other arrangements that may ● Evaluating s ystems’ readiness. As a result of these efforts, the Company currently anticipates that the adoption of ASU 2016 02 d as operating leases are expected to be reported on the consolidated balance sheets. The pattern of recognition for operating leases within the consolidated statements of comprehensive income is not Income Taxes In Fe bruary 2018, 2018 02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income December 2017. December 15, 2018. |
