Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 1-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'UNIVERSAL ELECTRONICS INC | ' |
Entity Central Index Key | '0000101984 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 15,913,340 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $90,400 | $76,174 |
Accounts receivable, net | 84,762 | 95,408 |
Inventories, net | 90,172 | 96,309 |
Prepaid expenses and other current assets | 4,491 | 4,395 |
Income tax receivable | 201 | 13 |
Deferred income taxes | 6,157 | 6,167 |
Total current assets | 276,183 | 278,466 |
Property, plant, and equipment, net | 73,516 | 75,570 |
Goodwill | 30,992 | 31,000 |
Intangible assets, net | 26,136 | 26,963 |
Deferred income taxes | 5,423 | 6,455 |
Other assets | 5,162 | 5,279 |
Total assets | 417,412 | 423,733 |
Current liabilities: | ' | ' |
Accounts payable | 54,257 | 58,498 |
Line of credit | 0 | 0 |
Accrued compensation | 33,834 | 38,317 |
Accrued sales discounts, rebates and royalties | 6,255 | 8,539 |
Accrued income taxes | 704 | 3,032 |
Deferred income taxes | 302 | 303 |
Other accrued expenses | 10,388 | 11,229 |
Total current liabilities | 105,740 | 119,918 |
Long-term liabilities: | ' | ' |
Deferred income taxes | 9,985 | 9,887 |
Income tax payable | 607 | 606 |
Other long-term liabilities | 2,025 | 2,052 |
Total liabilities | 118,357 | 132,463 |
Commitments and contingencies | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, 50,000,000 shares authorized; 22,550,142 and 22,344,121 shares issued on March 31, 2014 and December 31, 2013, respectively | 226 | 223 |
Paid-in capital | 205,434 | 199,513 |
Accumulated other comprehensive income (loss) | 871 | 2,982 |
Retained earnings | 197,805 | 193,532 |
Stockholders' equity before treasury stock | 404,336 | 396,250 |
Less cost of common stock in treasury, 6,643,109 and 6,639,497 shares on March 31, 2014 and December 31, 2013, respectively | -105,281 | -104,980 |
Total stockholders' equity | 299,055 | 291,270 |
Total liabilities and stockholders' equity | $417,412 | $423,733 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 22,550,142 | 22,344,121 |
Treasury stock, shares | 6,643,109 | 6,639,497 |
CONSOLIDATED_INCOME_STATEMENTS
CONSOLIDATED INCOME STATEMENTS (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Statement [Abstract] | ' | ' |
Net sales | $129,845 | $114,722 |
Cost of sales | 93,299 | 82,173 |
Gross profit | 36,546 | 32,549 |
Research and development expenses | 4,277 | 4,241 |
Selling, general and administrative expenses | 26,279 | 24,413 |
Operating income | 5,990 | 3,895 |
Interest income (expense), net | -16 | 9 |
Other income (expense), net | -349 | -550 |
Income before provision for income taxes | 5,625 | 3,354 |
Provision for income taxes | 1,352 | 408 |
Net income | $4,273 | $2,946 |
Earnings per share: | ' | ' |
Basic (in dollars per share) | $0.27 | $0.20 |
Diluted (in dollars per share) | $0.26 | $0.19 |
Shares used in computing earnings per share: | ' | ' |
Basic (in shares) | 15,787 | 14,965 |
Diluted (in shares) | 16,163 | 15,225 |
CONSOLIDATED_COMPREHENSIVE_INC
CONSOLIDATED COMPREHENSIVE INCOME STATEMENTS (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' |
Net income | $4,273 | $2,946 |
Other comprehensive income (loss): | ' | ' |
Change in foreign currency translation adjustment | -2,111 | -1,126 |
Comprehensive income | $2,162 | $1,820 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash provided by (used for) operating activities: | ' | ' |
Net income | $4,273 | $2,946 |
Adjustments to reconcile net income to net cash provided by (used for) operating activities: | ' | ' |
Depreciation and amortization | 4,260 | 4,374 |
Provision for doubtful accounts | 61 | 24 |
Provision for inventory write-downs | 596 | 573 |
Deferred income taxes | 948 | -954 |
Tax benefit from exercise of stock options and vested restricted stock | 731 | 2 |
Excess tax benefit from stock-based compensation | -723 | -37 |
Shares issued for employee benefit plan | 347 | 255 |
Stock-based compensation | 1,678 | 1,261 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 9,967 | 1,669 |
Inventories | 4,756 | -6,066 |
Prepaid expenses and other assets | -15 | -268 |
Accounts payable and accrued expenses | -10,489 | -14,345 |
Accrued income and other taxes | -2,484 | -731 |
Net cash provided by (used for) operating activities | 13,906 | -11,297 |
Cash used for investing activities: | ' | ' |
Acquisition of property, plant, and equipment | -2,396 | -3,058 |
Acquisition of intangible assets | -204 | -291 |
Net cash used for investing activities | -2,600 | -3,349 |
Cash provided by (used for) financing activities: | ' | ' |
Issuance of debt | 0 | 13,500 |
Payment of debt | 0 | -13,500 |
Proceeds from stock options exercised | 3,272 | 593 |
Treasury stock purchased | -405 | -1,558 |
Excess tax benefit from stock-based compensation | 723 | 37 |
Net cash provided by (used for) financing activities | 3,590 | -928 |
Effect of exchange rate changes on cash | -670 | -295 |
Net increase (decrease) in cash and cash equivalents | 14,226 | -15,869 |
Cash and cash equivalents at beginning of year | 76,174 | 44,593 |
Cash and cash equivalents at end of period | 90,400 | 28,724 |
Supplemental Cash Flow Information: | ' | ' |
Income taxes paid | 1,601 | 1,682 |
Interest paid | $0 | $22 |
Basis_of_Presentation_and_Sign
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation and Significant Accounting Policies | ' |
Basis of Presentation and Significant Accounting Policies | |
In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its wholly-owned subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary. | |
Our results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the "Risk Factors," "Management Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk," and the "Financial Statements and Supplementary Data" and notes thereto included in Items 1A, 7, 7A, and 8, respectively, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2013. | |
Estimates, Judgments and Assumptions | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates, judgments and assumptions, including those related to revenue recognition, allowance for doubtful accounts, warranties, inventory valuation, impairment of long-lived assets, intangible assets and goodwill, income taxes and stock-based compensation expense. Actual results may differ from our expectations. Based on our evaluation, our estimates, judgments and assumptions may be adjusted as more information becomes available. Any adjustment may be material. | |
See Note 2 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2013 for a summary of our significant accounting policies. | |
Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." This standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This guidance became effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this guidance did not have a material impact on our consolidated financial statements. |
Cash_and_Cash_Equivalents
Cash and Cash Equivalents | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Cash and Cash Equivalents [Abstract] | ' | |||||||
Cash and Cash Equivalents | ' | |||||||
Cash and Cash Equivalents | ||||||||
Cash and cash equivalents were held in the following geographic regions: | ||||||||
(In thousands) | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
United States | $ | 27,781 | $ | 30,082 | ||||
Asia | 48,263 | 34,627 | ||||||
Europe | 11,552 | 7,161 | ||||||
South America | 2,804 | 4,304 | ||||||
Total cash and cash equivalents | $ | 90,400 | $ | 76,174 | ||||
Accounts_Receivable_Net_and_Re
Accounts Receivable, Net and Revenue Concentrations | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Receivables [Abstract] | ' | |||||||||||||
Accounts Receivable, Net and Revenue Concentrations | ' | |||||||||||||
Accounts Receivable, Net and Revenue Concentrations | ||||||||||||||
Accounts receivable, net were as follows: | ||||||||||||||
(In thousands) | March 31, | December 31, | ||||||||||||
2014 | 2013 | |||||||||||||
Trade receivables, gross | $ | 82,989 | $ | 94,325 | ||||||||||
Allowance for doubtful accounts | (545 | ) | (478 | ) | ||||||||||
Allowance for sales returns | (656 | ) | (865 | ) | ||||||||||
Net trade receivables | 81,788 | 92,982 | ||||||||||||
Other | 2,974 | 2,426 | ||||||||||||
Accounts receivable, net | $ | 84,762 | $ | 95,408 | ||||||||||
Allowance for Doubtful Accounts | ||||||||||||||
Changes in the allowance for doubtful accounts were as follows: | ||||||||||||||
(In thousands) | Three Months Ended March 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 478 | $ | 322 | ||||||||||
Additions to costs and expenses | 61 | 24 | ||||||||||||
(Write-offs)/FX effects | 6 | (15 | ) | |||||||||||
Balance at end of period | $ | 545 | $ | 331 | ||||||||||
Allowance for Sales Returns | ||||||||||||||
The allowance for sales returns at March 31, 2014 and December 31, 2013 included reserves for items returned prior to period-end that were not completely processed, and therefore had not yet been removed from the allowance for sales returns balance. If these returns had been fully processed, the allowance for sales returns balance would have been approximately $0.4 million and $0.5 million on March 31, 2014 and December 31, 2013, respectively. The value of these returned goods was included in our inventory balance at March 31, 2014 and December 31, 2013. | ||||||||||||||
Significant Customer | ||||||||||||||
Net sales to the following customer totaled more than 10% of our net sales: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Net Sales | $ (thousands) | % of Net Sales | |||||||||||
DIRECTV | $ | 14,716 | 11.3 | % | $ | 20,847 | 18.2 | % | ||||||
The loss of this customer or any other customer, either in the United States or abroad, due to their financial weakness or bankruptcy, or our inability to obtain orders or maintain our order volume with them, may have a material adverse effect on our financial condition, results of operations and cash flows. |
Inventories_Net_and_Significan
Inventories, Net and Significant Suppliers | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Inventory Disclosure [Abstract] | ' | |||||||||||||
Inventories, Net and Significant Suppliers | ' | |||||||||||||
Inventories, Net and Significant Suppliers | ||||||||||||||
Inventories, net were as follows: | ||||||||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||||||||
Raw materials | $ | 20,115 | $ | 18,990 | ||||||||||
Components | 15,002 | 18,623 | ||||||||||||
Work in process | 3,305 | 2,017 | ||||||||||||
Finished goods | 54,348 | 59,393 | ||||||||||||
Reserve for excess and obsolete inventory | (2,598 | ) | (2,714 | ) | ||||||||||
Inventories, net | $ | 90,172 | $ | 96,309 | ||||||||||
Reserve for Excess and Obsolete Inventory | ||||||||||||||
Changes in the reserve for excess and obsolete inventory were as follows: | ||||||||||||||
(In thousands) | Three Months Ended March 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 2,714 | $ | 2,024 | ||||||||||
Additions charged to costs and expenses (1) | 551 | 479 | ||||||||||||
Sell through (2) | (205 | ) | (57 | ) | ||||||||||
Write-offs/FX effects | (462 | ) | (597 | ) | ||||||||||
Balance at end of period | $ | 2,598 | $ | 1,849 | ||||||||||
-1 | The additions charged to costs and expenses do not include inventory directly written-off that was scrapped during production totaling $45 thousand and $94 thousand for the three months ended March 31, 2014 and 2013, respectively. These amounts are production waste and are not included in management’s reserve for excess and obsolete inventory. | |||||||||||||
-2 | These amounts represent the reversal of reserves associated with inventory items that were sold during the period. Sell through is the result of differences between our judgment concerning the saleability of inventory items during the excess and obsolete inventory review process and our subsequent experience. | |||||||||||||
Significant Supplier | ||||||||||||||
We purchase integrated circuits, components and finished goods from multiple sources. We had purchases from the following significant supplier that totaled more than 10% of our total inventory purchases as follows: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Total | $ (thousands) | % of Total | |||||||||||
Inventory Purchases | Inventory Purchases | |||||||||||||
Maxim Integrated Products International Limited | $ | 8,054 | 13 | % | — | — | ||||||||
Related Party Vendor | ||||||||||||||
We purchase certain printed circuit board assemblies from a related party vendor. The vendor is considered a related party for financial reporting purposes because our Senior Vice President of Manufacturing owns 40% of this vendor. Inventory purchases from this vendor were as follows: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Total | $ (thousands) | % of Total | |||||||||||
Inventory Purchases | Inventory Purchases | |||||||||||||
Related party vendor | $ | 1,723 | 2.8 | % | $ | 2,216 | 3.4 | % | ||||||
Total accounts payable to this vendor were the following: | ||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||
$ (thousands) | % of Accounts Payable | $ (thousands) | % of Accounts Payable | |||||||||||
Related party vendor | $ | 1,100 | 2 | % | $ | 2,439 | 4.2 | % | ||||||
Our payable terms and pricing with this vendor are consistent with the terms offered by other vendors in the ordinary course of business. The accounting policies that we apply to our transactions with our related party vendor are consistent with those applied in transactions with independent third parties. Corporate management routinely monitors purchases from our related party vendor to ensure these purchases remain consistent with our business objectives. |
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets, Net | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||||||||
Goodwill and Intangible Assets, Net | ' | |||||||||||||||||||||||
Goodwill and Intangible Assets, Net | ||||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||
Goodwill and changes in the carrying amount of goodwill were as follows: | ||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 31,000 | ||||||||||||||||||||||
Goodwill adjustments (1) | (8 | ) | ||||||||||||||||||||||
Balance at March 31, 2014 | $ | 30,992 | ||||||||||||||||||||||
(1) | Adjustments were the result of fluctuations in the foreign currency exchange rates used to translate balances into U.S. Dollars. | |||||||||||||||||||||||
Intangible Assets, Net | ||||||||||||||||||||||||
The components of intangible assets, net were as follows: | ||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||||||||||||
(In thousands) | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||
Carrying amount (1): | ||||||||||||||||||||||||
Distribution rights | $ | 395 | $ | (53 | ) | $ | 342 | $ | 395 | $ | (52 | ) | $ | 343 | ||||||||||
Patents | 9,071 | (4,462 | ) | 4,609 | 8,879 | (4,251 | ) | 4,628 | ||||||||||||||||
Trademark and trade names | 2,836 | (1,478 | ) | 1,358 | 2,841 | (1,411 | ) | 1,430 | ||||||||||||||||
Developed and core technology | 3,505 | (1,197 | ) | 2,308 | 3,506 | (1,140 | ) | 2,366 | ||||||||||||||||
Capitalized software development costs | 311 | (170 | ) | 141 | 311 | (133 | ) | 178 | ||||||||||||||||
Customer relationships | 26,397 | (9,019 | ) | 17,378 | 26,406 | (8,388 | ) | 18,018 | ||||||||||||||||
Total carrying amount | $ | 42,515 | $ | (16,379 | ) | $ | 26,136 | $ | 42,338 | $ | (15,375 | ) | $ | 26,963 | ||||||||||
(1) | This table excludes the gross value of fully amortized intangible assets totaling $6.6 million and $6.6 million on March 31, 2014 and December 31, 2013, respectively. | |||||||||||||||||||||||
Amortization expense is recorded in selling, general and administrative expenses, except amortization expense related to capitalized software development costs which is recorded in cost of sales. Amortization expense by income statement caption was as follows: | ||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||
(In thousands) | 2014 | 2013 | ||||||||||||||||||||||
Cost of sales | $ | 37 | $ | 92 | ||||||||||||||||||||
Selling, general and administrative | 986 | 972 | ||||||||||||||||||||||
Total amortization expense | $ | 1,023 | $ | 1,064 | ||||||||||||||||||||
Estimated future amortization expense related to our intangible assets at March 31, 2014, is as follows: | ||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
2014 (remaining 9 months) | $ | 3,070 | ||||||||||||||||||||||
2015 | 3,941 | |||||||||||||||||||||||
2016 | 3,902 | |||||||||||||||||||||||
2017 | 3,874 | |||||||||||||||||||||||
2018 | 3,864 | |||||||||||||||||||||||
Thereafter | 7,485 | |||||||||||||||||||||||
Total | $ | 26,136 | ||||||||||||||||||||||
We recorded immaterial impairment charges related to our intangible assets for the three months ended March 31, 2014 and 2013. Impairment charges are recorded in selling, general and administrative expenses as a component of amortization expense, except impairment charges related to capitalized software development costs which are recorded in cost of sales. Quoted prices for identical or similar patents, trademarks and trade names are unavailable. The fair value of intangible assets is based upon management's judgment. Management believes that the net book value represents the fair value of our patents, trademarks and trade names. |
Line_of_Credit
Line of Credit | 3 Months Ended |
Mar. 31, 2014 | |
Debt Disclosure [Abstract] | ' |
Line of Credit | ' |
Line of Credit | |
On October 2, 2012, we entered into an Amended and Restated Credit Agreement ("Amended Credit Agreement") with U.S. Bank National Association ("U.S. Bank") which provides for a $55.0 million line of credit ("Credit Line") that may be used for working capital and other general corporate purposes including acquisitions, share repurchases and capital expenditures. The Amended Credit Agreement expires on November 1, 2014. Amounts available for borrowing under the Credit Line are reduced by the balance of any outstanding letters of credit, of which there were $13 thousand at March 31, 2014. | |
All obligations under the Credit Line are secured by substantially all of our U.S. personal property and tangible and intangible assets as well as 65% of our ownership interest in Enson Assets Limited, our wholly-owned subsidiary which controls our manufacturing factories in the People's Republic of China ("PRC"). | |
Under the Amended Credit Agreement, we may elect to pay interest on the Credit Line based on LIBOR plus an applicable margin (varying from 1.25% to 1.75%) or base rate (based on the prime rate of U.S. Bank or as otherwise specified in the Amended Credit Agreement) plus an applicable margin (varying from -0.25% to +0.25%). The applicable margins are calculated quarterly and vary based on our leverage ratio as set forth in the Amended Credit Agreement. There are no commitment fees or unused line fees under the Amended Credit Agreement. | |
The Amended Credit Agreement includes financial covenants requiring a minimum fixed charge coverage ratio, a maximum leverage ratio and minimum liquidity levels. In addition, the Amended Credit Agreement also contains other customary affirmative and negative covenants and events of default. As of March 31, 2014, we were in compliance with the covenants and conditions of the Amended Credit Agreement. | |
We had no interest expense on borrowings during the three months ended March 31, 2014. Our total interest expense on borrowings was $23 thousand during the three months ended March 31, 2013. |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
We utilize our estimated annual effective tax rate to determine our provision for income taxes for interim periods. The income tax provision is computed by taking the estimated annual effective tax rate and multiplying it by the year-to-date pre-tax book income. | |
We recorded income tax expense of $1.4 million and $0.4 million for the three months ended March 31, 2014 and 2013, respectively. Our effective tax rate was 24.0% and 12.2% during the three months ended March 31, 2014 and 2013, respectively. The increase in our effective tax rate was due primarily to the recognition of a tax benefit of $0.4 million during the three months ended March 31, 2013 related to the 2012 federal R&D tax credit, which passed legislation during the three months ended March 31, 2013. As of March 31, 2014, the federal R&D tax credit for 2014 had not been passed; therefore, the estimated benefit is not included in our estimated tax rate for the current year. In addition, the "Look-Through" rule expired as of December 31, 2013 which resulted in an increase of Subpart F income. Partially offsetting these items are foreign earnings, which have a lower tax rate than the United States, representing a higher percentage of our pre-tax income. | |
On March 31, 2014, we had gross unrecognized tax benefits of approximately $3.6 million, including interest and penalties, of which approximately $3.2 million would affect the annual effective tax rate if these tax benefits are realized. Further, we are unaware of any positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase within the next twelve months. However, based on federal, state and foreign statute expirations in various jurisdictions, we anticipate a decrease in unrecognized tax benefits of approximately $0.2 million within the next twelve months. | |
We have elected to classify interest and penalties as a component of tax expense. Accrued interest and penalties of $0.2 million and $0.1 million on March 31, 2014 and December 31, 2013, respectively, are included in our unrecognized tax benefits. | |
We file income tax returns in the U.S. federal jurisdiction, and in various state and foreign jurisdictions. On March 31, 2014, the open statutes of limitations in our significant tax jurisdictions were as follows: federal 2010 through 2013, state 2009 through 2013, and non-U.S. 2007 through 2013. On March 31, 2014, of our gross unrecognized tax benefits of $3.6 million, which included $0.2 million of interest and penalties, $1.5 million are classified as current and $2.1 million are classified as long term. |
Accrued_Compensation
Accrued Compensation | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Accrued Compensation | ' | |||||||
Accrued Compensation | ||||||||
The components of accrued compensation are listed below: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Accrued social insurance (1) | $ | 19,986 | $ | 20,492 | ||||
Accrued salary/wages | 6,176 | 5,324 | ||||||
Accrued vacation/holiday | 2,483 | 2,113 | ||||||
Accrued bonus (2) | 1,679 | 7,186 | ||||||
Accrued commission | 476 | 1,350 | ||||||
Accrued medical insurance claims | 216 | 201 | ||||||
Other accrued compensation | 2,818 | 1,651 | ||||||
Total accrued compensation | $ | 33,834 | $ | 38,317 | ||||
(1) | Effective January 1, 2008, the Chinese Labor Contract Law was enacted in the PRC. This law mandated that PRC employers remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job injury insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2014 and December 31, 2013. | |||||||
(2) | Accrued bonus includes an accrual for an extra month of salary ("13th month salary") to be paid to employees in certain geographies where it is the customary business practice. This 13th month salary is paid to these employees if they remain employed with us through December 31st. The total accrued for the 13th month salary was $0.3 million and $0.6 million at March 31, 2014 and December 31, 2013, respectively. |
Other_Accrued_Expenses
Other Accrued Expenses | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Other Accrued Expenses | ' | |||||||
Other Accrued Expenses | ||||||||
The components of other accrued expenses are listed below: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Advertising and marketing | $ | 254 | $ | 238 | ||||
Duties | 701 | 797 | ||||||
Freight | 1,095 | 1,374 | ||||||
Product development | 839 | 614 | ||||||
Product warranty claim costs | 21 | 41 | ||||||
Professional fees | 1,699 | 1,757 | ||||||
Sales taxes and VAT | 496 | 1,637 | ||||||
Third-party commissions | 592 | 511 | ||||||
Tooling (1) | 677 | 758 | ||||||
Unrealized loss on foreign currency exchange futures contracts | 996 | 2 | ||||||
Utilities | 312 | 311 | ||||||
Other | 2,706 | 3,189 | ||||||
Total other accrued expenses | $ | 10,388 | $ | 11,229 | ||||
(1) | The tooling accrual balance relates to unearned revenue for tooling that will be sold to customers. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Commitments and Contingencies | ' | |||||||
Commitments and Contingencies | ||||||||
Product Warranties | ||||||||
Changes in the liability for product warranty claim costs were as follows: | ||||||||
(In thousands) | Three Months Ended March 31, | |||||||
2014 | 2013 | |||||||
Balance at beginning of period | $ | 41 | $ | 404 | ||||
Accruals for warranties issued during the period | 21 | 375 | ||||||
Settlements (in cash or in kind) during the period | (41 | ) | (325 | ) | ||||
Balance at end of period | $ | 21 | $ | 454 | ||||
Litigation | ||||||||
On March 2, 2012, we filed a lawsuit against Universal Remote Control, Inc. ("URC") in the United States District Court, Central District of California (Universal Electronics Inc. v. Universal Remote Control, Inc., SACV12-0039 AG (JPRx)) alleging that URC is infringing, directly and indirectly, four of our patents related to remote control technology. We have alleged that this complaint relates to multiple URC remote control products, including the URC model numbers UR5U-9000L, WR7 and other remote controls with different model names or numbers, but with substantially the same designs, features, and functionalities. We are seeking monetary relief for the infringement, including enhanced damages due to the willfulness of URC's actions, injunctive relief to enjoin URC from further infringing, including contributory infringement and/or inducing infringement, and attorney's fees. URC has denied infringing our patents and has asserted a variety of counterclaims and affirmative defenses including invalidity and unenforceability of our patents, misuse of patents, and a breach of contract action stemming from the settlement by us of an earlier lawsuit against URC. On January 29, 2013, the Court held its "Markman" hearing and on February 1, 2013, the Court issued its ruling that four of the 24 claims we asserted against URC were invalid, effectively removing one of the four patents alleged by us to be infringed by URC from this litigation. In April 2014, the Court further narrowed the scope of this litigation by effectively removing two additional patents. In our estimation these rulings do not materially affect our position in this litigation. In all other respects, this litigation is continuing as scheduled with trial set to commence on May 6, 2014. | ||||||||
On June 28, 2013, we filed a second lawsuit against URC, also in the United States District Court, Central District of California (Universal Electronics Inc. v. Universal Remote Control, Inc., SACV13-00987 JAK (SHx)). In this second lawsuit, we are alleging that URC is infringing, directly and indirectly, ten additional patents that we own related to remote control technology. As in the first lawsuit, in this second lawsuit we have alleged that this complaint relates to multiple URC remote control products. We are seeking monetary relief for infringement, including enhanced damages due to the willfulness of URC's actions, injunctive relief to enjoin URC from further infringing, including contributory infringement and/or inducing infringement, and attorney's fees. In mid-July 2013, URC filed a Notice of Related Cases seeking to join this lawsuit with the lawsuit we filed against URC on March 2, 2012 and we did not object to this Notice. Consequently, this lawsuit was transferred to the Judge and Magistrate hearing our first lawsuit filed against URC. In addition, URC answered this complaint with a denial of infringement, asserting affirmative defenses, and seeking a ruling that URC has not infringed our patents, that our patents are invalid and unenforceable, that the patents have been licensed to URC, and an award of attorneys’ fees and costs. In mid-November 2013, UEI filed a motion to add affiliated URC suppliers, Ohsung Electronics Co, Ltd, a South Korean entity, and Ohsung Electronics USA, Inc., a California entity, (collectively "Ohsung"), to the lawsuit. In February 2014, Ohsung answered and counterclaimed with a general denial of wrongdoing and asserted the standard affirmative defenses of non-infringement, invalidity and unenforceability of our patents and breach of contract action stemming from the settlement by us of an earlier lawsuit against URC. In March 2014, we answered by disputing Ohsung’s defenses and with a general denial of Ohsung’s breach of contract complaint. We are seeking attorney’s fees. In all other respects this litigation is continuing as scheduled with discovery underway. | ||||||||
On September 23, 2013, we filed a lawsuit against Peel Technologies, Inc. (“Peel”) in the United States District Court, Central District of California (Universal Electronics Inc. v. Peel Technologies, Inc., SACV13-01484 GAF (RNBx)) alleging that Peel is infringing, directly and indirectly, five of our patents related to remote control technology. We have alleged that this complaint relates to software and hardware used in connection with remote control devices, including Peel’s software products called “TV App” (sometimes referred to as “Sense TV”), “WatchOn App” and “Peel Smart Remote App,” and a product called “Peel Universal Remote” consisting of a Peel “Fruit” hardware device and a software component for use with the iOS operating system. We are seeking monetary relief for the infringement, including enhanced damages due to the willfulness of Peel’s actions, injunctive relief to enjoin Peel from further infringment, including contributory infringement and/or inducing infringement, and attorney’s fees. On November 14, 2013, Peel answered our complaint with a general denial that it is infringing our patents and has filed counter-claims, seeking declaratory judgments that our patents are not infringed and are invalid. They are also seeking attorney’s fees. In our reply to Peel’s counterclaims, which we filed on December 5, 2013, we have asked the Court to deny and dismiss with prejudice Peel’s counterclaims and sought after relief. In April 2014, both parties were granted leave by the court to amend the pleadings in the case. We have added four additional patents related to remote control technology, and Peel has filed a counterclaim against us alleging we are infringing one patent related to remote control technology which they recently acquired. We answered Peel’s counterclaim with a general denial of infringement and added our affirmative defenses of non-infringement, invalidity and unenforceability. We will seek attorney fees in connection with defending against this countersuit. In all other respects, this litigation is continuing with discovery just beginning. | ||||||||
In March 2014, two of our subsidiaries, Gemstar Technology (China) Co. Ltd. and Gemstar Technology (Yangzhou) Co. Ltd., each filed arbitration requests in Hong Kong under the arbitration rules of the Hong Kong International Arbitration Centre (the “HKIAC”) against Dongguan City Liwang Battery Co. Ltd. (“LiWang”). In these requests, our subsidiaries are claiming that LiWang supplied defective batteries and are seeking damages incurred as a result. LiWang is opposing jurisdiction under the HKIAC and has, in turn, filed a claim against Gemstar Technology (China) Co. Ltd. in the People’s Court of Panyu District, Guangzhou City, alleging breach of contract and that jurisdiction should be in China. We are opposing these claims and are awaiting a ruling by the China Court. | ||||||||
There are no other material pending legal proceedings to which we or any of our subsidiaries is a party or of which our respective property is the subject. However, as is typical in our industry and to the nature and kind of business in which we are engaged, from time to time, various claims, charges and litigation are asserted or commenced by third parties against us or by us against third parties arising from or related to product liability, infringement of patent or other intellectual property rights, breach of warranty, contractual relations, or employee relations. The amounts claimed may be substantial but may not bear any reasonable relationship to the merits of the claims or the extent of any real risk of court awards assessed against us or in our favor. However, no assurances can be made as to the outcome of any of these matters, nor can we estimate the range of potential losses to us. In our opinion, final judgments, if any, which might be rendered against us in potential or pending litigation would not have a material adverse effect on our financial condition, results of operations, or cash flows. Moreover, we believe that our products do not infringe any third parties' patents or other intellectual property rights. | ||||||||
We maintain directors' and officers' liability insurance which insures our individual directors and officers against certain claims, as well as attorney's fees and related expenses incurred in connection with the defense of such claims. | ||||||||
Defined Benefit Plan | ||||||||
Our subsidiary in India maintains a defined benefit pension plan ("India Plan") for local employees, which is consistent with local statutes and practices. The pension plan was adequately funded on March 31, 2014 and December 31, 2013 based on its latest actuarial report. The India Plan has an independent external manager that advises us of the appropriate funding contribution requirements to which we comply. At March 31, 2014, approximately 38 percent of our India subsidiary employees had qualified for eligibility. An individual must be employed by our India subsidiary for a minimum of 5 years before becoming eligible. Upon the termination, resignation or retirement of an eligible employee, we are liable to pay the employee an amount equal to 15 days salary for each full year of service completed. The total amount of liability outstanding at March 31, 2014 and December 31, 2013 for the India Plan was not material. During the three months ended March 31, 2014 and 2013, the net periodic benefit costs were also not material. |
Treasury_Stock
Treasury Stock | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Treasury Stock | ' | |||||||
Treasury Stock | ||||||||
Repurchased shares of our common stock were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands, except share data) | 2014 | 2013 | ||||||
Shares repurchased | 11,112 | 81,019 | ||||||
Cost of shares repurchased | $ | 405 | $ | 1,558 | ||||
Repurchased shares are recorded as shares held in treasury at cost. We hold these shares for future use as management and the Board of Directors deem appropriate, which has included compensating our outside directors. During the three months ended March 31, 2014 and 2013, we issued 7,500 and 7,500 shares from treasury, respectively, to outside directors for services performed (see Note 13). | ||||||||
From time to time, our Board of Directors authorizes management to repurchase shares of our issued and outstanding common stock. Repurchases may be made to manage dilution created by shares issued under our stock incentive plans or whenever we deem a repurchase is a good use of our cash and the price to be paid is at or below a threshold approved by our Board. As of March 31, 2014, we had 922,344 shares available for repurchase under the Board's authorizations. On April 23, 2014, our Board increased these repurchase authorizations by 81,516 shares bringing the total authorization as of the approval date to 1,000,000 shares. |
Business_Segment_and_Foreign_O
Business Segment and Foreign Operations | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Segment Reporting [Abstract] | ' | |||||||
Business Segment and Foreign Operations | ' | |||||||
Business Segment and Foreign Operations | ||||||||
Reportable Segment | ||||||||
An operating segment, in part, is a component of an enterprise whose operating results are regularly reviewed by the chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance. Operating segments may be aggregated only to a limited extent. Our chief operating decision maker, the Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenues for purposes of making operating decisions and assessing financial performance. Accordingly, we only have a single operating and reportable segment. | ||||||||
Foreign Operations | ||||||||
Our net sales to external customers by geographic area were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Net sales: | ||||||||
United States | $ | 47,896 | $ | 44,768 | ||||
Asia (excluding PRC) | 31,518 | 22,160 | ||||||
People's Republic of China | 20,670 | 16,821 | ||||||
Europe | 15,271 | 15,529 | ||||||
Latin America | 9,025 | 7,823 | ||||||
Other | 5,465 | 7,621 | ||||||
Total net sales | $ | 129,845 | $ | 114,722 | ||||
Specific identification of the customer billing location was the basis used for attributing revenues from external customers to geographic areas. | ||||||||
Long-lived tangible assets were as follows: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Long-lived tangible assets: | ||||||||
United States | $ | 4,573 | $ | 4,662 | ||||
People's Republic of China | 70,094 | 72,957 | ||||||
All other countries | 4,011 | 3,230 | ||||||
Total | $ | 78,678 | $ | 80,849 | ||||
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Stock-Based Compensation | ' | ||||||||||||
Stock-Based Compensation | |||||||||||||
Stock-based compensation expense for each employee and director is presented in the same income statement caption as their cash compensation. Stock-based compensation expense by income statement caption and the related income tax benefit were as follows: | |||||||||||||
Three Months Ended March 31, | |||||||||||||
(In thousands) | 2014 | 2013 | |||||||||||
Cost of sales | $ | 4 | $ | — | |||||||||
Research and development | 101 | 57 | |||||||||||
Selling, general and administrative: | |||||||||||||
Employees | 1,358 | 1,109 | |||||||||||
Outside directors | 215 | 95 | |||||||||||
Total stock-based compensation expense | $ | 1,678 | $ | 1,261 | |||||||||
Income tax benefit | $ | 490 | $ | 359 | |||||||||
Stock Options | |||||||||||||
Stock option activity was as follows: | |||||||||||||
Number of Options | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Terms | Aggregate Intrinsic Value | ||||||||||
(in 000's) | (in years) | (in 000's) | |||||||||||
Outstanding at December 31, 2013 | 924 | $ | 22.04 | ||||||||||
Granted | 133 | 35.28 | |||||||||||
Exercised | (170 | ) | 19.21 | $ | 3,817 | ||||||||
Forfeited/canceled/expired | (3 | ) | 14.92 | ||||||||||
Outstanding at March 31, 2014 (1) | 884 | $ | 22.58 | 6.3 | $ | 13,969 | |||||||
Vested and expected to vest at March 31, 2014 (1) | 882 | $ | 22.58 | 6.29 | $ | 13,935 | |||||||
Exercisable on March 31, 2014 (1) | 549 | $ | 23.65 | 5.34 | $ | 8,093 | |||||||
(1) | The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the first quarter of 2014 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on March 31, 2014. This amount will change based on the fair market value of our stock. | ||||||||||||
The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following: | |||||||||||||
Three Months Ended March 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Weighted average fair value of grants (1) | $ | 13.64 | $ | 9.22 | |||||||||
Risk-free interest rate | 1.29 | % | 0.96 | % | |||||||||
Expected volatility | 44.84 | % | 53.44 | % | |||||||||
Expected life in years | 4.56 | 5.2 | |||||||||||
(1) | The weighted average fair value of grants was calculated utilizing the stock options granted during each respective period. | ||||||||||||
As of March 31, 2014, we expect to recognize $3.4 million of total unrecognized pre-tax stock-based compensation expense related to non-vested stock options over a remaining weighted-average life of 2.3 years. | |||||||||||||
Restricted Stock | |||||||||||||
Non-vested restricted stock award activity was as follows: | |||||||||||||
Shares Granted | Weighted-Average Grant Date Fair Value | ||||||||||||
(in 000’s) | |||||||||||||
Non-vested at December 31, 2013 | 285 | $ | 24.64 | ||||||||||
Granted | 52 | 35.28 | |||||||||||
Vested | (34 | ) | 24.24 | ||||||||||
Forfeited | (2 | ) | 37.78 | ||||||||||
Non-vested at March 31, 2014 | 301 | $ | 26.44 | ||||||||||
As of March 31, 2014, we expect to recognize $6.9 million of total unrecognized pre-tax stock-based compensation expense related to non-vested restricted stock awards over a weighted-average life of 2.3 years. |
Other_Income_Expense_Net
Other Income (Expense), Net | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Other Income and Expenses [Abstract] | ' | |||||||
Other Income (Expense), Net | ' | |||||||
Other Income (Expense), Net | ||||||||
Other income (expense), net consisted of the following: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Net gain (loss) on foreign currency exchange contracts (1) | $ | (1,049 | ) | $ | (198 | ) | ||
Net gain (loss) on foreign currency exchange transactions | 693 | (353 | ) | |||||
Other income | 7 | 1 | ||||||
Other income (expense), net | $ | (349 | ) | $ | (550 | ) | ||
(1) | This represents the gains and (losses) incurred on foreign currency hedging derivatives (see Note 16 for further details). |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Earnings Per Share | ' | |||||||
Earnings Per Share | ||||||||
Earnings per share was calculated as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands, except per-share amounts) | 2014 | 2013 | ||||||
BASIC | ||||||||
Net income | $ | 4,273 | $ | 2,946 | ||||
Weighted-average common shares outstanding | 15,787 | 14,965 | ||||||
Basic earnings per share | $ | 0.27 | $ | 0.2 | ||||
DILUTED | ||||||||
Net income | $ | 4,273 | $ | 2,946 | ||||
Weighted-average common shares outstanding for basic | 15,787 | 14,965 | ||||||
Dilutive effect of stock options and restricted stock | 376 | 260 | ||||||
Weighted-average common shares outstanding on a diluted basis | 16,163 | 15,225 | ||||||
Diluted earnings per share | $ | 0.26 | $ | 0.19 | ||||
The number of stock options and shares of restricted stock excluded from the computation of diluted earnings per common share were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Stock options | 73 | 818 | ||||||
Restricted stock awards | 28 | 61 | ||||||
Derivatives
Derivatives | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
Derivatives | ' | ||||||||||||||||||||||||||||||||
Derivatives | |||||||||||||||||||||||||||||||||
Derivatives Measured at Fair Value on a Recurring Basis | |||||||||||||||||||||||||||||||||
We are exposed to market risks from foreign currency exchange rates, which may adversely affect our operating results and financial position. Our foreign currency exposures are primarily concentrated in the Argentinian Peso, Brazilian Real, British Pound, Chinese Yuan Renminbi, Euro, Hong Kong dollar, Indian Rupee, and Singapore dollar. We periodically enter into foreign currency exchange contracts with terms normally lasting less than nine months to protect against the adverse effects that exchange-rate fluctuations may have on our foreign currency-denominated receivables, payables, cash flows and reported income. Derivative financial instruments are used to manage risk and are not used for trading or other speculative purposes. We do not use leveraged derivative financial instruments and these derivatives have not qualified for hedge accounting. | |||||||||||||||||||||||||||||||||
The gains and losses on the derivatives are recorded in other income (expense), net. Derivatives are recorded on the balance sheet at fair value. The estimated fair values of our derivative financial instruments represent the amount required to enter into offsetting contracts with similar remaining maturities based on quoted market prices. We have determined that the fair value of our derivatives are derived from level 2 inputs in the fair value hierarchy. The following table sets forth the total net fair value of derivatives: | |||||||||||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||||||||||
Fair Value Measurement Using | Total | Fair Value Measurement Using | Total | ||||||||||||||||||||||||||||||
(In thousands) | (Level 1) | (Level 2) | (Level 3) | Balance | (Level 1) | (Level 2) | (Level 3) | Balance | |||||||||||||||||||||||||
Foreign currency exchange futures contracts | $ | — | $ | (980 | ) | $ | — | $ | (980 | ) | $ | — | $ | 509 | $ | — | $ | 509 | |||||||||||||||
We held foreign currency exchange contracts which resulted in a net pre-tax loss of $1.0 million and $0.2 million for the three months ended March 31, 2014 and 2013, respectively. | |||||||||||||||||||||||||||||||||
Futures Contracts | |||||||||||||||||||||||||||||||||
Details of futures contracts held were as follows: | |||||||||||||||||||||||||||||||||
Date Held | Type | Position Held | Notional Value | Forward Rate | Gain/(Loss) Recorded at Balance Sheet | Settlement Date | |||||||||||||||||||||||||||
(in millions) | Date | ||||||||||||||||||||||||||||||||
(in thousands)(1) | |||||||||||||||||||||||||||||||||
March 31, 2014 | USD/Euro | Euro | $ | 2 | 1.3668 | $ | 16 | April 4, 2014 | |||||||||||||||||||||||||
March 31, 2014 | USD/Chinese Yuan Renminbi | Chinese Yuan Renminbi | $ | 25 | 6.0461 | $ | (738 | ) | July 18, 2014 | ||||||||||||||||||||||||
March 31, 2014 | USD/Brazilian Real | USD | $ | 5 | 2.453 | $ | (258 | ) | July 18, 2014 | ||||||||||||||||||||||||
December 31, 2013 | USD/Euro | Euro | $ | 11 | 1.3782 | $ | (2 | ) | January 31, 2014 | ||||||||||||||||||||||||
December 31, 2013 | USD/Chinese Yuan Renminbi | Chinese Yuan Renminbi | $ | 15 | 6.2047 | $ | 358 | January 15, 2014 | |||||||||||||||||||||||||
December 31, 2013 | USD/Brazilian Real | USD | $ | 3 | 2.3442 | $ | 34 | January 17, 2014 | |||||||||||||||||||||||||
December 31, 2013 | USD/Brazilian Real | USD | $ | 2 | 2.2301 | $ | 119 | January 17, 2014 | |||||||||||||||||||||||||
(1) | Gains on futures contracts are recorded in prepaid expenses and other current assets. Losses on futures contracts are recorded in other accrued expenses. |
Basis_of_Presentation_and_Sign1
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Principles of Consolidation | ' |
In the opinion of management, the accompanying consolidated financial statements of Universal Electronics Inc. and its wholly-owned subsidiaries contain all the adjustments necessary for a fair presentation of financial position, results of operations and cash flows for the periods presented. All such adjustments are of a normal recurring nature and certain reclassifications have been made to prior year amounts in order to conform to the current year presentation. Information and footnote disclosures normally included in financial statements, which are prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. As used herein, the terms "Company," "we," "us," and "our" refer to Universal Electronics Inc. and its subsidiaries, unless the context indicates to the contrary. | |
Our results of operations for the three months ended March 31, 2014 are not necessarily indicative of the results to be expected for the full year. These financial statements should be read in conjunction with the "Risk Factors," "Management Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk," and the "Financial Statements and Supplementary Data" and notes thereto included in Items 1A, 7, 7A, and 8, respectively, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2013. | |
Estimates and Assumptions Policy | ' |
Estimates, Judgments and Assumptions | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates, judgments and assumptions, including those related to revenue recognition, allowance for doubtful accounts, warranties, inventory valuation, impairment of long-lived assets, intangible assets and goodwill, income taxes and stock-based compensation expense. Actual results may differ from our expectations. Based on our evaluation, our estimates, judgments and assumptions may be adjusted as more information becomes available. Any adjustment may be material. | |
Recent Accounting Pronouncements Policy | ' |
Recent Accounting Pronouncements | |
In July 2013, the FASB issued ASU 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists." This standard requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This guidance became effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this guidance did not have a material impact on our consolidated financial statements. |
Cash_and_Cash_Equivalents_Tabl
Cash and Cash Equivalents (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Cash and Cash Equivalents [Abstract] | ' | |||||||
Schedule of Cash and Cash Equivalents | ' | |||||||
Cash and cash equivalents were held in the following geographic regions: | ||||||||
(In thousands) | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
United States | $ | 27,781 | $ | 30,082 | ||||
Asia | 48,263 | 34,627 | ||||||
Europe | 11,552 | 7,161 | ||||||
South America | 2,804 | 4,304 | ||||||
Total cash and cash equivalents | $ | 90,400 | $ | 76,174 | ||||
Accounts_Receivable_Net_and_Re1
Accounts Receivable, Net and Revenue Concentrations (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Receivables [Abstract] | ' | |||||||||||||
Schedule of Accounts Receivable | ' | |||||||||||||
Accounts receivable, net were as follows: | ||||||||||||||
(In thousands) | March 31, | December 31, | ||||||||||||
2014 | 2013 | |||||||||||||
Trade receivables, gross | $ | 82,989 | $ | 94,325 | ||||||||||
Allowance for doubtful accounts | (545 | ) | (478 | ) | ||||||||||
Allowance for sales returns | (656 | ) | (865 | ) | ||||||||||
Net trade receivables | 81,788 | 92,982 | ||||||||||||
Other | 2,974 | 2,426 | ||||||||||||
Accounts receivable, net | $ | 84,762 | $ | 95,408 | ||||||||||
Allowance for Doubtful Accounts | ||||||||||||||
Changes in the allowance for doubtful accounts were as follows: | ||||||||||||||
(In thousands) | Three Months Ended March 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 478 | $ | 322 | ||||||||||
Additions to costs and expenses | 61 | 24 | ||||||||||||
(Write-offs)/FX effects | 6 | (15 | ) | |||||||||||
Balance at end of period | $ | 545 | $ | 331 | ||||||||||
Schedule of Significant Customers to Net Sales | ' | |||||||||||||
Net sales to the following customer totaled more than 10% of our net sales: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Net Sales | $ (thousands) | % of Net Sales | |||||||||||
DIRECTV | $ | 14,716 | 11.3 | % | $ | 20,847 | 18.2 | % | ||||||
Inventories_Net_and_Significan1
Inventories, Net and Significant Suppliers (Tables) | 3 Months Ended | |||||||||||||
Mar. 31, 2014 | ||||||||||||||
Inventory Disclosure [Abstract] | ' | |||||||||||||
Schedule of Inventories, Net | ' | |||||||||||||
Inventories, net were as follows: | ||||||||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||||||||
Raw materials | $ | 20,115 | $ | 18,990 | ||||||||||
Components | 15,002 | 18,623 | ||||||||||||
Work in process | 3,305 | 2,017 | ||||||||||||
Finished goods | 54,348 | 59,393 | ||||||||||||
Reserve for excess and obsolete inventory | (2,598 | ) | (2,714 | ) | ||||||||||
Inventories, net | $ | 90,172 | $ | 96,309 | ||||||||||
Schedule of Reserve for Excess and Obsolete Inventory | ' | |||||||||||||
Changes in the reserve for excess and obsolete inventory were as follows: | ||||||||||||||
(In thousands) | Three Months Ended March 31, | |||||||||||||
2014 | 2013 | |||||||||||||
Balance at beginning of period | $ | 2,714 | $ | 2,024 | ||||||||||
Additions charged to costs and expenses (1) | 551 | 479 | ||||||||||||
Sell through (2) | (205 | ) | (57 | ) | ||||||||||
Write-offs/FX effects | (462 | ) | (597 | ) | ||||||||||
Balance at end of period | $ | 2,598 | $ | 1,849 | ||||||||||
-1 | The additions charged to costs and expenses do not include inventory directly written-off that was scrapped during production totaling $45 thousand and $94 thousand for the three months ended March 31, 2014 and 2013, respectively. These amounts are production waste and are not included in management’s reserve for excess and obsolete inventory. | |||||||||||||
-2 | These amounts represent the reversal of reserves associated with inventory items that were sold during the period. Sell through is the result of differences between our judgment concerning the saleability of inventory items during the excess and obsolete inventory review process and our subsequent experience. | |||||||||||||
Schedule of Purchases from Significant Supplier(s) to Inventory | ' | |||||||||||||
We had purchases from the following significant supplier that totaled more than 10% of our total inventory purchases as follows: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Total | $ (thousands) | % of Total | |||||||||||
Inventory Purchases | Inventory Purchases | |||||||||||||
Maxim Integrated Products International Limited | $ | 8,054 | 13 | % | — | — | ||||||||
Schedule of Related Party Transactions | ' | |||||||||||||
We purchase certain printed circuit board assemblies from a related party vendor. The vendor is considered a related party for financial reporting purposes because our Senior Vice President of Manufacturing owns 40% of this vendor. Inventory purchases from this vendor were as follows: | ||||||||||||||
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 | |||||||||||||
$ (thousands) | % of Total | $ (thousands) | % of Total | |||||||||||
Inventory Purchases | Inventory Purchases | |||||||||||||
Related party vendor | $ | 1,723 | 2.8 | % | $ | 2,216 | 3.4 | % | ||||||
Total accounts payable to this vendor were the following: | ||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||
$ (thousands) | % of Accounts Payable | $ (thousands) | % of Accounts Payable | |||||||||||
Related party vendor | $ | 1,100 | 2 | % | $ | 2,439 | 4.2 | % | ||||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended | |||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||||||||
Schedule of Goodwill | ' | |||||||||||||||||||||||
Goodwill and changes in the carrying amount of goodwill were as follows: | ||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
Balance at December 31, 2013 | $ | 31,000 | ||||||||||||||||||||||
Goodwill adjustments (1) | (8 | ) | ||||||||||||||||||||||
Balance at March 31, 2014 | $ | 30,992 | ||||||||||||||||||||||
(1) | Adjustments were the result of fluctuations in the foreign currency exchange rates used to translate balances into U.S. Dollars. | |||||||||||||||||||||||
Schedule of Components of Intangible Assets | ' | |||||||||||||||||||||||
The components of intangible assets, net were as follows: | ||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | |||||||||||||||||||||||
(In thousands) | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||
Carrying amount (1): | ||||||||||||||||||||||||
Distribution rights | $ | 395 | $ | (53 | ) | $ | 342 | $ | 395 | $ | (52 | ) | $ | 343 | ||||||||||
Patents | 9,071 | (4,462 | ) | 4,609 | 8,879 | (4,251 | ) | 4,628 | ||||||||||||||||
Trademark and trade names | 2,836 | (1,478 | ) | 1,358 | 2,841 | (1,411 | ) | 1,430 | ||||||||||||||||
Developed and core technology | 3,505 | (1,197 | ) | 2,308 | 3,506 | (1,140 | ) | 2,366 | ||||||||||||||||
Capitalized software development costs | 311 | (170 | ) | 141 | 311 | (133 | ) | 178 | ||||||||||||||||
Customer relationships | 26,397 | (9,019 | ) | 17,378 | 26,406 | (8,388 | ) | 18,018 | ||||||||||||||||
Total carrying amount | $ | 42,515 | $ | (16,379 | ) | $ | 26,136 | $ | 42,338 | $ | (15,375 | ) | $ | 26,963 | ||||||||||
(1) | This table excludes the gross value of fully amortized intangible assets totaling $6.6 million and $6.6 million on March 31, 2014 and December 31, 2013, respectively. | |||||||||||||||||||||||
Intangible Assets Amortization Expense | ' | |||||||||||||||||||||||
Amortization expense by income statement caption was as follows: | ||||||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||||||
(In thousands) | 2014 | 2013 | ||||||||||||||||||||||
Cost of sales | $ | 37 | $ | 92 | ||||||||||||||||||||
Selling, general and administrative | 986 | 972 | ||||||||||||||||||||||
Total amortization expense | $ | 1,023 | $ | 1,064 | ||||||||||||||||||||
Schedule of Estimated Future Amortization Expense | ' | |||||||||||||||||||||||
Estimated future amortization expense related to our intangible assets at March 31, 2014, is as follows: | ||||||||||||||||||||||||
(In thousands) | ||||||||||||||||||||||||
2014 (remaining 9 months) | $ | 3,070 | ||||||||||||||||||||||
2015 | 3,941 | |||||||||||||||||||||||
2016 | 3,902 | |||||||||||||||||||||||
2017 | 3,874 | |||||||||||||||||||||||
2018 | 3,864 | |||||||||||||||||||||||
Thereafter | 7,485 | |||||||||||||||||||||||
Total | $ | 26,136 | ||||||||||||||||||||||
Accrued_Compensation_Tables
Accrued Compensation (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Components of Accrued Compensation | ' | |||||||
The components of accrued compensation are listed below: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Accrued social insurance (1) | $ | 19,986 | $ | 20,492 | ||||
Accrued salary/wages | 6,176 | 5,324 | ||||||
Accrued vacation/holiday | 2,483 | 2,113 | ||||||
Accrued bonus (2) | 1,679 | 7,186 | ||||||
Accrued commission | 476 | 1,350 | ||||||
Accrued medical insurance claims | 216 | 201 | ||||||
Other accrued compensation | 2,818 | 1,651 | ||||||
Total accrued compensation | $ | 33,834 | $ | 38,317 | ||||
(1) | Effective January 1, 2008, the Chinese Labor Contract Law was enacted in the PRC. This law mandated that PRC employers remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job injury insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on March 31, 2014 and December 31, 2013. | |||||||
(2) | Accrued bonus includes an accrual for an extra month of salary ("13th month salary") to be paid to employees in certain geographies where it is the customary business practice. This 13th month salary is paid to these employees if they remain employed with us through December 31st. The total accrued for the 13th month salary was $0.3 million and $0.6 million at March 31, 2014 and December 31, 2013, respectively. |
Other_Accrued_Expenses_Tables
Other Accrued Expenses (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Components of Other Accrued Expenses | ' | |||||||
The components of other accrued expenses are listed below: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Advertising and marketing | $ | 254 | $ | 238 | ||||
Duties | 701 | 797 | ||||||
Freight | 1,095 | 1,374 | ||||||
Product development | 839 | 614 | ||||||
Product warranty claim costs | 21 | 41 | ||||||
Professional fees | 1,699 | 1,757 | ||||||
Sales taxes and VAT | 496 | 1,637 | ||||||
Third-party commissions | 592 | 511 | ||||||
Tooling (1) | 677 | 758 | ||||||
Unrealized loss on foreign currency exchange futures contracts | 996 | 2 | ||||||
Utilities | 312 | 311 | ||||||
Other | 2,706 | 3,189 | ||||||
Total other accrued expenses | $ | 10,388 | $ | 11,229 | ||||
(1) | The tooling accrual balance relates to unearned revenue for tooling that will be sold to customers. |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Schedule of Changes in Reserve for Product Warranty Claim Costs | ' | |||||||
Changes in the liability for product warranty claim costs were as follows: | ||||||||
(In thousands) | Three Months Ended March 31, | |||||||
2014 | 2013 | |||||||
Balance at beginning of period | $ | 41 | $ | 404 | ||||
Accruals for warranties issued during the period | 21 | 375 | ||||||
Settlements (in cash or in kind) during the period | (41 | ) | (325 | ) | ||||
Balance at end of period | $ | 21 | $ | 454 | ||||
Treasury_Stock_Tables
Treasury Stock (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Treasury Stock | ' | |||||||
Repurchased shares of our common stock were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands, except share data) | 2014 | 2013 | ||||||
Shares repurchased | 11,112 | 81,019 | ||||||
Cost of shares repurchased | $ | 405 | $ | 1,558 | ||||
Business_Segment_and_Foreign_O1
Business Segment and Foreign Operations (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Segment Reporting [Abstract] | ' | |||||||
Schedule of Net Sales to External Customers by Geographic Area | ' | |||||||
Our net sales to external customers by geographic area were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Net sales: | ||||||||
United States | $ | 47,896 | $ | 44,768 | ||||
Asia (excluding PRC) | 31,518 | 22,160 | ||||||
People's Republic of China | 20,670 | 16,821 | ||||||
Europe | 15,271 | 15,529 | ||||||
Latin America | 9,025 | 7,823 | ||||||
Other | 5,465 | 7,621 | ||||||
Total net sales | $ | 129,845 | $ | 114,722 | ||||
Schedule of Long-lived Assets | ' | |||||||
Long-lived tangible assets were as follows: | ||||||||
(In thousands) | March 31, 2014 | December 31, 2013 | ||||||
Long-lived tangible assets: | ||||||||
United States | $ | 4,573 | $ | 4,662 | ||||
People's Republic of China | 70,094 | 72,957 | ||||||
All other countries | 4,011 | 3,230 | ||||||
Total | $ | 78,678 | $ | 80,849 | ||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Schedule of Stock-based Compensation Expense | ' | ||||||||||||
Stock-based compensation expense by income statement caption and the related income tax benefit were as follows: | |||||||||||||
Three Months Ended March 31, | |||||||||||||
(In thousands) | 2014 | 2013 | |||||||||||
Cost of sales | $ | 4 | $ | — | |||||||||
Research and development | 101 | 57 | |||||||||||
Selling, general and administrative: | |||||||||||||
Employees | 1,358 | 1,109 | |||||||||||
Outside directors | 215 | 95 | |||||||||||
Total stock-based compensation expense | $ | 1,678 | $ | 1,261 | |||||||||
Income tax benefit | $ | 490 | $ | 359 | |||||||||
Schedule of Stock Option Activity | ' | ||||||||||||
Stock option activity was as follows: | |||||||||||||
Number of Options | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Terms | Aggregate Intrinsic Value | ||||||||||
(in 000's) | (in years) | (in 000's) | |||||||||||
Outstanding at December 31, 2013 | 924 | $ | 22.04 | ||||||||||
Granted | 133 | 35.28 | |||||||||||
Exercised | (170 | ) | 19.21 | $ | 3,817 | ||||||||
Forfeited/canceled/expired | (3 | ) | 14.92 | ||||||||||
Outstanding at March 31, 2014 (1) | 884 | $ | 22.58 | 6.3 | $ | 13,969 | |||||||
Vested and expected to vest at March 31, 2014 (1) | 882 | $ | 22.58 | 6.29 | $ | 13,935 | |||||||
Exercisable on March 31, 2014 (1) | 549 | $ | 23.65 | 5.34 | $ | 8,093 | |||||||
(1) | The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the first quarter of 2014 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on March 31, 2014. This amount will change based on the fair market value of our stock. | ||||||||||||
Schedule of Black Scholes Assumptions | ' | ||||||||||||
The assumptions we utilized in the Black-Scholes option pricing model and the resulting weighted average fair value of stock option grants were the following: | |||||||||||||
Three Months Ended March 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Weighted average fair value of grants (1) | $ | 13.64 | $ | 9.22 | |||||||||
Risk-free interest rate | 1.29 | % | 0.96 | % | |||||||||
Expected volatility | 44.84 | % | 53.44 | % | |||||||||
Expected life in years | 4.56 | 5.2 | |||||||||||
(1) | The weighted average fair value of grants was calculated utilizing the stock options granted during each respective period. | ||||||||||||
Schedule of Non-vested Restricted Stock Awards Activity | ' | ||||||||||||
Non-vested restricted stock award activity was as follows: | |||||||||||||
Shares Granted | Weighted-Average Grant Date Fair Value | ||||||||||||
(in 000’s) | |||||||||||||
Non-vested at December 31, 2013 | 285 | $ | 24.64 | ||||||||||
Granted | 52 | 35.28 | |||||||||||
Vested | (34 | ) | 24.24 | ||||||||||
Forfeited | (2 | ) | 37.78 | ||||||||||
Non-vested at March 31, 2014 | 301 | $ | 26.44 | ||||||||||
Other_Income_Expense_Net_Table
Other Income (Expense), Net (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Other Income and Expenses [Abstract] | ' | |||||||
Schedule of Components of Other Income (Expense), Net | ' | |||||||
Other income (expense), net consisted of the following: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Net gain (loss) on foreign currency exchange contracts (1) | $ | (1,049 | ) | $ | (198 | ) | ||
Net gain (loss) on foreign currency exchange transactions | 693 | (353 | ) | |||||
Other income | 7 | 1 | ||||||
Other income (expense), net | $ | (349 | ) | $ | (550 | ) | ||
(1) | This represents the gains and (losses) incurred on foreign currency hedging derivatives (see Note 16 for further details). |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Schedule of Basic and Diluted Earnings Per Share | ' | |||||||
Earnings per share was calculated as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands, except per-share amounts) | 2014 | 2013 | ||||||
BASIC | ||||||||
Net income | $ | 4,273 | $ | 2,946 | ||||
Weighted-average common shares outstanding | 15,787 | 14,965 | ||||||
Basic earnings per share | $ | 0.27 | $ | 0.2 | ||||
DILUTED | ||||||||
Net income | $ | 4,273 | $ | 2,946 | ||||
Weighted-average common shares outstanding for basic | 15,787 | 14,965 | ||||||
Dilutive effect of stock options and restricted stock | 376 | 260 | ||||||
Weighted-average common shares outstanding on a diluted basis | 16,163 | 15,225 | ||||||
Diluted earnings per share | $ | 0.26 | $ | 0.19 | ||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | |||||||
The number of stock options and shares of restricted stock excluded from the computation of diluted earnings per common share were as follows: | ||||||||
Three Months Ended March 31, | ||||||||
(In thousands) | 2014 | 2013 | ||||||
Stock options | 73 | 818 | ||||||
Restricted stock awards | 28 | 61 | ||||||
Derivatives_Tables
Derivatives (Tables) | 3 Months Ended | ||||||||||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | ||||||||||||||||||||||||||||||||
Schedule of Derivatives at Fair Value on a Recurring Basis | ' | ||||||||||||||||||||||||||||||||
The following table sets forth the total net fair value of derivatives: | |||||||||||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||||||||||
Fair Value Measurement Using | Total | Fair Value Measurement Using | Total | ||||||||||||||||||||||||||||||
(In thousands) | (Level 1) | (Level 2) | (Level 3) | Balance | (Level 1) | (Level 2) | (Level 3) | Balance | |||||||||||||||||||||||||
Foreign currency exchange futures contracts | $ | — | $ | (980 | ) | $ | — | $ | (980 | ) | $ | — | $ | 509 | $ | — | $ | 509 | |||||||||||||||
Schedule of Futures Contracts | ' | ||||||||||||||||||||||||||||||||
Date Held | Type | Position Held | Notional Value | Forward Rate | Gain/(Loss) Recorded at Balance Sheet | Settlement Date | |||||||||||||||||||||||||||
(in millions) | Date | ||||||||||||||||||||||||||||||||
(in thousands)(1) | |||||||||||||||||||||||||||||||||
March 31, 2014 | USD/Euro | Euro | $ | 2 | 1.3668 | $ | 16 | April 4, 2014 | |||||||||||||||||||||||||
March 31, 2014 | USD/Chinese Yuan Renminbi | Chinese Yuan Renminbi | $ | 25 | 6.0461 | $ | (738 | ) | July 18, 2014 | ||||||||||||||||||||||||
March 31, 2014 | USD/Brazilian Real | USD | $ | 5 | 2.453 | $ | (258 | ) | July 18, 2014 | ||||||||||||||||||||||||
December 31, 2013 | USD/Euro | Euro | $ | 11 | 1.3782 | $ | (2 | ) | January 31, 2014 | ||||||||||||||||||||||||
December 31, 2013 | USD/Chinese Yuan Renminbi | Chinese Yuan Renminbi | $ | 15 | 6.2047 | $ | 358 | January 15, 2014 | |||||||||||||||||||||||||
December 31, 2013 | USD/Brazilian Real | USD | $ | 3 | 2.3442 | $ | 34 | January 17, 2014 | |||||||||||||||||||||||||
December 31, 2013 | USD/Brazilian Real | USD | $ | 2 | 2.2301 | $ | 119 | January 17, 2014 | |||||||||||||||||||||||||
(1) | Gains on futures contracts are recorded in prepaid expenses and other current assets. Losses on futures contracts are recorded in other accrued expenses. |
Cash_and_Cash_Equivalents_Geog
Cash and Cash Equivalents - Geographic Information (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | $90,400 | $76,174 | $28,724 | $44,593 |
United States [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 27,781 | 30,082 | ' | ' |
Asia [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 48,263 | 34,627 | ' | ' |
Europe [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | 11,552 | 7,161 | ' | ' |
South America [Member] | ' | ' | ' | ' |
Cash and Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash and cash equivalents | $2,804 | $4,304 | ' | ' |
Accounts_Receivable_Net_and_Re2
Accounts Receivable, Net and Revenue Concentrations (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Accounts Receivable, Net, Current [Abstract] | ' | ' | ' | ' |
Trade receivables, gross | $82,989 | $94,325 | ' | ' |
Allowance for doubtful accounts | -545 | -478 | -331 | -322 |
Allowance for sales returns | -656 | -865 | ' | ' |
Net trade receivables | 81,788 | 92,982 | ' | ' |
Other | 2,974 | 2,426 | ' | ' |
Accounts receivable, net | $84,762 | $95,408 | ' | ' |
Accounts_Receivable_Net_and_Re3
Accounts Receivable, Net and Revenue Concentrations - Allowance for Doubtful Accounts (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Schedule of Allowance for Doubtful Accounts | ' | ' |
Balance at beginning of period | $478 | $322 |
Additions to costs and expenses | 61 | 24 |
(Write-offs)/FX effects | 6 | -15 |
Balance at end of period | $545 | $331 |
Accounts_Receivable_Net_and_Re4
Accounts Receivable, Net and Revenue Concentrations - Sales Returns (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Receivables [Abstract] | ' | ' |
Allowance for sales return | $0.40 | $0.50 |
Accounts_Receivable_Net_and_Re5
Accounts Receivable, Net and Revenue Concentrations - Revenue by Significant Customer (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue, Major Customer [Line Items] | ' | ' |
Net sales | $129,845 | $114,722 |
Sales [Member] | DIRECTV [Member] | ' | ' |
Revenue, Major Customer [Line Items] | ' | ' |
Net sales | $14,716 | $20,847 |
Concentration risk | 11.30% | 18.20% |
Inventories_Net_and_Significan2
Inventories, Net and Significant Suppliers (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||||
Inventory Disclosure [Abstract] | ' | ' | ' | ' |
Raw materials | $20,115 | $18,990 | ' | ' |
Components | 15,002 | 18,623 | ' | ' |
Work in process | 3,305 | 2,017 | ' | ' |
Finished goods | 54,348 | 59,393 | ' | ' |
Reserve for excess and obsolete inventory | -2,598 | -2,714 | -1,849 | -2,024 |
Inventories, net | $90,172 | $96,309 | ' | ' |
Inventories_Net_and_Significan3
Inventories, Net and Significant Suppliers - Inventory Reserves (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Schedule of Reserve for Excess and Obsolete Inventory | ' | ' | ||
Balance at Beginning of Period | $2,714 | $2,024 | ||
Additions Charged to Costs and Expenses | 551 | [1] | 479 | [1] |
Sell Through | -205 | [2] | -57 | [2] |
Write-offs/FX Effects | -462 | -597 | ||
Balance at End of Period | 2,598 | 1,849 | ||
Inventory Scrapped During Production | $45 | $94 | ||
[1] | The additions charged to costs and expenses do not include inventory directly written-off that was scrapped during production totaling $45 thousand and $94 thousand for the three months ended MarchB 31, 2014 and 2013, respectively. These amounts are production waste and are not included in managementbs reserve for excess and obsolete inventory. | |||
[2] | These amounts represent the reversal of reserves associated with inventory items that were sold during the period. Sell through is the result of differences between our judgment concerning the saleability of inventory items during the excess and obsolete inventory review process and our subsequent experience. |
Recovered_Sheet1
Inventories, Net And Significant Suppliers - Purchases from Significant Suppliers (Details) (Cost of Goods, Total [Member], Supplier Concentration Risk [Member], Maxim [Member], USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cost of Goods, Total [Member] | Supplier Concentration Risk [Member] | Maxim [Member] | ' | ' |
Concentration Risk [Line Items] | ' | ' |
Inventory Purchases | $8,054 | $0 |
Concentration risk | 13.00% | 0.00% |
Inventories_Net_and_Significan4
Inventories, Net and Significant Suppliers - Related Party Vendor (Details) (USD $) | 3 Months Ended | 12 Months Ended | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 |
Executive Vice President [Member] | Affiliated Entity [Member] | Affiliated Entity [Member] | Supplier Concentration Risk [Member] | Supplier Concentration Risk [Member] | |
Cost of Goods, Total [Member] | Cost of Goods, Total [Member] | ||||
Affiliated Entity [Member] | Affiliated Entity [Member] | ||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Ownership Percentage in Third Party by Executive | 40.00% | ' | ' | ' | ' |
Related Party Purchases | ' | ' | ' | $1,723 | $2,216 |
Concentration Risk | ' | 2.00% | 4.20% | 2.80% | 3.40% |
Related Parties, Accounts Payable | ' | $1,100 | $2,439 | ' | ' |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets, Net - Goodwill (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | |
Schedule of Goodwill | ' | |
Goodwill, Opening balance | $31,000 | |
Goodwill adjustments | -8 | [1] |
Goodwill, Closing balance | $30,992 | |
[1] | Adjustments were the result of fluctuations in the foreign currency exchange rates used to translate balances into U.S. Dollars. |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets, Net - Finite-Lived Intangibles (Details) (USD $) | 3 Months Ended | ||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | $42,515,000 | ' | $42,338,000 | ||
Accumulated Amortization | -16,379,000 | ' | -15,375,000 | ||
Intangible assets, net | 26,136,000 | ' | 26,963,000 | ||
Finite-lived intangible assets, fully amortized, gross | 6,600,000 | ' | 6,600,000 | ||
Amortization expense | 1,023,000 | 1,064,000 | ' | ||
Cost of Sales [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Amortization expense | 37,000 | 92,000 | ' | ||
Selling, General and Administrative Expenses [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Amortization expense | 986,000 | 972,000 | ' | ||
Distribution Rights [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 395,000 | [1] | ' | 395,000 | [1] |
Accumulated Amortization | -53,000 | [1] | ' | -52,000 | [1] |
Intangible assets, net | 342,000 | [1] | ' | 343,000 | [1] |
Patents [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 9,071,000 | [1] | ' | 8,879,000 | [1] |
Accumulated Amortization | -4,462,000 | [1] | ' | -4,251,000 | [1] |
Intangible assets, net | 4,609,000 | [1] | ' | 4,628,000 | [1] |
Trademarks and Trade Names [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 2,836,000 | [1] | ' | 2,841,000 | [1] |
Accumulated Amortization | -1,478,000 | [1] | ' | -1,411,000 | [1] |
Intangible assets, net | 1,358,000 | [1] | ' | 1,430,000 | [1] |
Developed and Core Technology [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 3,505,000 | [1] | ' | 3,506,000 | [1] |
Accumulated Amortization | -1,197,000 | [1] | ' | -1,140,000 | [1] |
Intangible assets, net | 2,308,000 | [1] | ' | 2,366,000 | [1] |
Capitalized software development costs [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 311,000 | [1] | ' | 311,000 | [1] |
Accumulated Amortization | -170,000 | [1] | ' | -133,000 | [1] |
Intangible assets, net | 141,000 | [1] | ' | 178,000 | [1] |
Customer Relationships [Member] | ' | ' | ' | ||
Finite-Lived Intangible Assets, Net [Abstract] | ' | ' | ' | ||
Gross | 26,397,000 | [1] | ' | 26,406,000 | [1] |
Accumulated Amortization | -9,019,000 | [1] | ' | -8,388,000 | [1] |
Intangible assets, net | $17,378,000 | [1] | ' | $18,018,000 | [1] |
[1] | This table excludes the gross value of fully amortized intangible assets totaling $6.6 million and $6.6 million on MarchB 31, 2014 and DecemberB 31, 2013, respectively. |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets, Net - Future Amortization Expense (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Estimated Future Amortization expense | ' | ' |
2014 (remaining 9 months) | $3,070 | ' |
2015 | 3,941 | ' |
2016 | 3,902 | ' |
2017 | 3,874 | ' |
2018 | 3,864 | ' |
Thereafter | 7,485 | ' |
Intangible assets, net | $26,136 | $26,963 |
Line_of_Credit_Details
Line of Credit (Details) (USD $) | 3 Months Ended | 0 Months Ended | |||||||
Mar. 31, 2014 | Mar. 31, 2013 | Oct. 02, 2012 | Oct. 02, 2012 | Oct. 02, 2012 | Oct. 02, 2012 | Oct. 02, 2012 | Oct. 02, 2012 | Mar. 31, 2014 | |
Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Line of Credit [Member] | Letter of Credit [Member] | |||
US Bank [Member] | US Bank [Member] | US Bank [Member] | US Bank [Member] | US Bank [Member] | |||||
London Interbank Offered Rate (LIBOR) [Member] | London Interbank Offered Rate (LIBOR) [Member] | Base Rate [Member] | Base Rate [Member] | Enson [Member] | |||||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | ||||||
Line of Credit Facility [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity | ' | ' | $55,000,000 | ' | ' | ' | ' | ' | ' |
Letter of credit outstanding amount | ' | ' | ' | ' | ' | ' | ' | ' | 13,000 |
Subsidiary ownership percentage securing facility | ' | ' | ' | ' | ' | ' | ' | 65.00% | ' |
Basis spread on variable rate | ' | ' | ' | 1.25% | 1.75% | -0.25% | 0.25% | ' | ' |
Total interest expense on borrowings | $0 | $23,000 | ' | ' | ' | ' | ' | ' | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Income tax expense (benefit) | $1,352,000 | $408,000 | ' |
Effective tax rate | 24.00% | 12.20% | ' |
Recognition of tax benefit, federal research and development, amount | ' | 400,000 | ' |
Gross unrecognized tax benefits | 3,600,000 | ' | ' |
Unrecognized tax benefits that would impact effective rate | 3,200,000 | ' | ' |
Decrease in unrecognized tax benefits is reasonably possible in next 12 months | 200,000 | ' | ' |
Accrued interest and penalties | 200,000 | ' | 100,000 |
Unrecognized tax benefits, income tax interest and penalties accrued, current | 1,500,000 | ' | ' |
Unrecognized tax benefits, income tax penalties and interest accrued, noncurrent | $2,100,000 | ' | ' |
Accrued_Compensation_Details
Accrued Compensation (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
Components of Accrued Compensation | ' | ' | ||
Accrued social insurance | $19,986,000 | [1] | $20,492,000 | [1] |
Accrued salary/wages | 6,176,000 | 5,324,000 | ||
Accrued vacation/holiday | 2,483,000 | 2,113,000 | ||
Accrued bonus | 1,679,000 | [2] | 7,186,000 | [2] |
Accrued commission | 476,000 | 1,350,000 | ||
Accrued medical insurance claims | 216,000 | 201,000 | ||
Other accrued compensation | 2,818,000 | 1,651,000 | ||
Total accrued compensation | 33,834,000 | 38,317,000 | ||
Accrued salaries - 13th month salaries | $300,000 | $600,000 | ||
[1] | Effective JanuaryB 1, 2008, the Chinese Labor Contract Law was enacted in the PRC. This law mandated that PRC employers remit the applicable social insurance payments to their local government. Social insurance is comprised of various components such as pension, medical insurance, job injury insurance, unemployment insurance, and a housing assistance fund, and is administered in a manner similar to social security in the United States. This amount represents our estimate of the amounts due to the PRC government for social insurance on MarchB 31, 2014 and DecemberB 31, 2013. | |||
[2] | Accrued bonus includes an accrual for an extra month of salary ("13th month salary") to be paid to employees in certain geographies where it is the customary business practice. This 13th month salary is paid to these employees if they remain employed with us through DecemberB 31st. The total accrued for the 13th month salary was $0.3 million and $0.6 million at MarchB 31, 2014 and December 31, 2013, respectively. |
Other_Accrued_Expenses_Details
Other Accrued Expenses (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Payables and Accruals [Abstract] | ' | ' | ||
Advertising and marketing | $254 | $238 | ||
Duties | 701 | 797 | ||
Freight | 1,095 | 1,374 | ||
Product development | 839 | 614 | ||
Product warranty claim costs | 21 | 41 | ||
Professional fees | 1,699 | 1,757 | ||
Sales taxes and VAT | 496 | 1,637 | ||
Third-party commissions | 592 | 511 | ||
Tooling | 677 | [1] | 758 | [1] |
Unrealized loss on foreign currency exchange futures contracts | 996 | 2 | ||
Utilities | 312 | 311 | ||
Other | 2,706 | 3,189 | ||
Total other accrued expenses | $10,388 | $11,229 | ||
[1] | The tooling accrual balance relates to unearned revenue for tooling that will be sold to customers. |
Commitments_and_Contingencies_1
Commitments and Contingencies - Warranty (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Schedule of Changes in Reserve for Product Warranty Claim Costs | ' | ' |
Balance at beginning of period | $41 | $404 |
Accruals for warranties issued during the period | 21 | 375 |
Settlements (in cash or in kind) during the period | -41 | -325 |
Balance at end of period | $21 | $454 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Litigation (Details) | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | ||||
Jun. 28, 2013 | Feb. 01, 2013 | Mar. 02, 2012 | Apr. 30, 2014 | Sep. 23, 2013 | Apr. 30, 2014 | Apr. 30, 2014 | Mar. 31, 2014 | |
Patent Lawsuit Against Universal Remote Control [Member] | Patent Lawsuit Against Universal Remote Control [Member] | Patent Lawsuit Against Universal Remote Control [Member] | Patent Lawsuit Against Universal Remote Control [Member] | Patent Lawsuit Against Peel Technologies, Inc. [Member] | Patent Lawsuit Against Peel Technologies, Inc. [Member] | Patent Counterclaim Lawsuit by Peel Technologies, Inc. [Member] | Lawsuit Against Liwang Battery Co. Ltd. [Member] | |
Positive Outcome of Litigation [Member] | Positive Outcome of Litigation [Member] | Positive Outcome of Litigation [Member] | Positive Outcome of Litigation [Member] | Positive Outcome of Litigation [Member] | Positive Outcome of Litigation [Member] | Subsequent Event [Member] | Positive Outcome of Litigation [Member] | |
patent | claim | patent | Subsequent Event [Member] | patent | Subsequent Event [Member] | patent | subsidiary | |
patent | patent | patent | ||||||
Gain Contingencies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Gain contingency, patents allegedly infringed upon, number | 10 | 4 | 4 | ' | 5 | 4 | ' | ' |
Loss contingency, patents allegedly infringed upon, number | ' | ' | ' | ' | ' | ' | 1 | ' |
Gain contingency, claims deemed invalid, number | ' | 4 | ' | ' | ' | ' | ' | ' |
Gain contingency, claims against defendant, number | ' | 24 | ' | ' | ' | ' | ' | ' |
Gain contingency, patents found not infringed upon, number | ' | 1 | ' | 2 | ' | ' | ' | ' |
Gain contingency, number of subsidiaries that filed arbitration requests | ' | ' | ' | ' | ' | ' | ' | 2 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Defined Benefit Plan (Details) (India Subsidiary [Member]) | 3 Months Ended |
Mar. 31, 2014 | |
India Subsidiary [Member] | ' |
Defined Benefit Plan Disclosure [Line Items] | ' |
Percentage of employees eligible for benefits | 38.00% |
Minimum service period of employees to be eligible under plan | '5 years |
Benefit obligation, accrual term per year of service provided | '15 days |
Treasury_Stock_Details
Treasury Stock (Details) (USD $) | 3 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Apr. 23, 2014 |
Subsequent Event [Member] | |||
Class of Stock [Line Items] | ' | ' | ' |
Shares repurchased | 11,112 | 81,019 | ' |
Cost of shares repurchased | $405 | $1,558 | ' |
Treasury stock reissued (shares) | 7,500 | 7,500 | ' |
Shares available for repurchase | 922,344 | ' | ' |
Stock Repurchase Program, Additional Number of Shares Authorized to be Repurchased | ' | ' | 81,516 |
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | ' | ' | 1,000,000 |
Business_Segment_and_Foreign_O2
Business Segment and Foreign Operations (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | $129,845 | $114,722 |
United States [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | 47,896 | 44,768 |
Asia (excluding PRC) [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | 31,518 | 22,160 |
People's Republic of China [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | 20,670 | 16,821 |
Europe [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | 15,271 | 15,529 |
Latin America [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | 9,025 | 7,823 |
All Other Countries [Member] | ' | ' |
Schedule of Revenues from Geographical Segments [Line Items] | ' | ' |
Total net sales | $5,465 | $7,621 |
Business_Segment_and_Foreign_O3
Business Segment and Foreign Operations - Long-lived Assets (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived tangible assets | $78,678 | $80,849 |
United States [Member] | ' | ' |
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived tangible assets | 4,573 | 4,662 |
People's Republic of China [Member] | ' | ' |
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived tangible assets | 70,094 | 72,957 |
All Other Countries [Member] | ' | ' |
Long-lived Assets from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Long-lived tangible assets | $4,011 | $3,230 |
Stockbased_Compensation_Detail
Stock-based Compensation (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Stock Options [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Total Compensation Cost Not yet Recognized | $3.40 |
Total Compensation Cost Not yet Recognized, Period for Recognition | '2 years 3 months 17 days |
Non-vested restricted stock award [Member] | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' |
Total Compensation Cost Not yet Recognized | $6.90 |
Total Compensation Cost Not yet Recognized, Period for Recognition | '2 years 3 months 17 days |
StockBased_Compensation_Expens
Stock-Based Compensation - Expense (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation | $1,678 | $1,261 |
Income tax benefit | 490 | 359 |
Cost of Sales [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation | 4 | 0 |
Research and development [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation | 101 | 57 |
Employees [Member] | Selling, general and administrative [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation | 1,358 | 1,109 |
Outside Directors [Member] | Selling, general and administrative [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock-based compensation | $215 | $95 |
StockBased_Compensation_Option
Stock-Based Compensation - Option Activity (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | |
Number of Options | ' | |
Outstanding at December 31, 2013 | 924 | |
Granted | 133 | |
Exercised | -170 | |
Forfeited/canceled/expired | -3 | |
Outstanding at March 31, 2014 | 884 | |
Vested and expected to vest at March 31, 2014 | 882 | |
Exercisable on March 31, 2014 | 549 | |
Weighted-Average Exercise Price | ' | |
Outstanding at December 31, 2013 | $22.04 | |
Granted | $35.28 | |
Exercised | $19.21 | |
Forfeited/canceled/expired | $14.92 | |
Outstanding at March 31, 2014 | $22.58 | |
Vested and expected to vest at March 31, 2014 | $22.58 | |
Exercisable on March 31, 2014 | $23.65 | |
Weighted-Average Remaining Contractual Term and Aggregate Intrinsic Value | ' | |
Outstanding at March 31, 2014 | '6 years 3 months 17 days | |
Vested and expected to vest at March 31, 2014 | '6 years 3 months 14 days | |
Exercisable on March 31, 2014 | '5 years 4 months 2 days | |
Exercised | $3,817 | |
Outstanding at March 31, 2014 | 13,969 | [1] |
Vested and expected to vest at March 31, 2014 | 13,935 | [1] |
Exercisable on March 31, 2014 | $8,093 | [1] |
[1] | The aggregate intrinsic value represents the total pre-tax value (the difference between our closing stock price on the last trading day of the first quarter of 2014 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had they all exercised their options on MarchB 31, 2014. This amount will change based on the fair market value of our stock. |
StockBased_Compensation_Valuat
Stock-Based Compensation - Valuation Assumptions (Details) (USD $) | 3 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | |||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ' | ||
Weighted average fair value of grants | $13.64 | [1] | $9.22 | [1] |
Risk-free interest rate | 1.29% | 0.96% | ||
Expected volatility | 44.84% | 53.44% | ||
Expected life in years | '4 years 6 months 21 days | '5 years 2 months 12 days | ||
[1] | The weighted average fair value of grants was calculated utilizing the stock options granted during each respective period. |
StockBased_Compensation_Restri
Stock-Based Compensation - Restricted Stock Activity (Details) (USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 |
Shares Granted | ' |
Non-vested at beginning of period | 285 |
Shares granted | 52 |
Shares Vested | -34 |
Shares Forfeited | -2 |
Non-vested at end of period | 301 |
Weighted-Average Grant Date Fair Value | ' |
Weighted-Average Grant Date Fair Value Non-vested at beginning of period | $24.64 |
Weighted-Average Grant Date Fair Value Granted | $35.28 |
Weighted-Average Grant Date Fair Value Vested | $24.24 |
Weighted-Average Grant Date Fair Value Forfeited | $37.78 |
Weighted-Average Grant Date Fair Value Non-vested at end of period | $26.44 |
Other_Income_Expense_Net_Detai
Other Income (Expense), Net (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Other Income and Expenses [Abstract] | ' | ' | ||
Net gain (loss) on foreign currency exchange contracts | ($1,049) | [1] | ($198) | [1] |
Net gain (loss) on foreign currency exchange transactions | 693 | -353 | ||
Other income | 7 | 1 | ||
Other income (expense), net | ($349) | ($550) | ||
[1] | This represents the gains and (losses) incurred on foreign currency hedging derivatives (see Note 16 for further details). |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
BASIC | ' | ' |
Net income | $4,273 | $2,946 |
Weighted-average common shares outstanding (in shares) | 15,787 | 14,965 |
Basic earnings per share (in dollars per share) | $0.27 | $0.20 |
DILUTED | ' | ' |
Net income | $4,273 | $2,946 |
Weighted-average common shares outstanding (in shares) | 15,787 | 14,965 |
Dilutive effect of stock options and restricted stock (in shares) | 376 | 260 |
Weighted-average common shares outstanding on a diluted basis (in shares) | 16,163 | 15,225 |
Diluted earnings per share (in dollars per share) | $0.26 | $0.19 |
Earnings_Per_Share_Antidilutiv
Earnings Per Share - Antidilutive Shares (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Stock Options [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Stock options and restricted stock excluded in computation of diluted earning per share | 73 | 818 |
Non-vested restricted stock award [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Stock options and restricted stock excluded in computation of diluted earning per share | 28 | 61 |
Derivatives_Details
Derivatives (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ||
Maximum Remaining Maturity of Foreign Currency Derivatives | '9 months | ' | ||
Net gain (loss) on foreign currency exchange contracts | ($1,049) | [1] | ($198) | [1] |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Other Income (Expense), Net [Member] | ' | ' | ||
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ||
Net gain (loss) on foreign currency exchange contracts | ($1,000) | ($200) | ||
[1] | This represents the gains and (losses) incurred on foreign currency hedging derivatives (see Note 16 for further details). |
Derivatives_Fair_Value_Details
Derivatives - Fair Value (Details) (Fair Value, Measurements, Recurring [Member], Foreign Exchange Forward [Member], Not Designated as Hedging Instrument [Member], USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Level 1 [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Foreign currency exchange futures contracts fair value | ' | $0 |
Foreign currency exchange futures contracts fair value | 0 | ' |
Level 2 [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Foreign currency exchange futures contracts fair value | ' | 509 |
Foreign currency exchange futures contracts fair value | -980 | ' |
Level 3 [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Foreign currency exchange futures contracts fair value | ' | 0 |
Foreign currency exchange futures contracts fair value | 0 | ' |
Estimate of Fair Value, Fair Value Disclosure [Member] | ' | ' |
Derivatives, Fair Value [Line Items] | ' | ' |
Foreign currency exchange futures contracts fair value | ' | 509 |
Foreign currency exchange futures contracts fair value | ($980) | ' |
Derivatives_Contracts_Held_Det
Derivatives - Contracts Held (Details) (Not Designated as Hedging Instrument [Member], Foreign Exchange Forward [Member], USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Euro | ' | ' |
Derivative [Line Items] | ' | ' |
Notional Value | $2,000,000 | $11,000,000 |
Forward Rate | 1.3668 | 1.3782 |
Gain/(Loss) Recorded at Balance Sheet Date | 16,000 | -2,000 |
Chinese Yuan Renminbi | ' | ' |
Derivative [Line Items] | ' | ' |
Notional Value | 25,000,000 | 15,000,000 |
Forward Rate | 6.0461 | 6.2047 |
Gain/(Loss) Recorded at Balance Sheet Date | -738,000 | 358,000 |
United States of America, Dollars | ' | ' |
Derivative [Line Items] | ' | ' |
Notional Value | 5,000,000 | ' |
Forward Rate | 2.453 | ' |
Gain/(Loss) Recorded at Balance Sheet Date | -258,000 | ' |
Future Contract One [Member] | United States of America, Dollars | ' | ' |
Derivative [Line Items] | ' | ' |
Notional Value | ' | 3,000,000 |
Forward Rate | ' | 2.3442 |
Gain/(Loss) Recorded at Balance Sheet Date | ' | 34,000 |
Future Contract Two [Member] | United States of America, Dollars | ' | ' |
Derivative [Line Items] | ' | ' |
Notional Value | ' | 2,000,000 |
Forward Rate | ' | 2.2301 |
Gain/(Loss) Recorded at Balance Sheet Date | ' | $119,000 |