Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Aug. 31, 2018 | Oct. 17, 2018 | Feb. 28, 2018 | |
Document Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Aug. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | wdfc | ||
Entity Registrant Name | WD 40 CO | ||
Entity Central Index Key | 105,132 | ||
Current Fiscal Year End Date | --08-31 | ||
Entity Current Reporting Status | Yes | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,695,560,161 | ||
Entity Common Stock, Shares Outstanding | 13,836,690 | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 | |
Current assets: | |||
Cash and cash equivalents | $ 48,866 | $ 37,082 | |
Short-term investments | 219 | 80,166 | |
Trade accounts receivable, less allowance for doubtful accounts of $340 and $240 at August 31, 2018 and 2017, respectively | 69,025 | 64,259 | |
Inventories | 36,536 | 35,340 | |
Other current assets | 13,337 | 8,007 | |
Total current assets | 167,983 | 224,854 | |
Property and equipment, net | [1] | 36,357 | 29,439 |
Goodwill | 95,621 | 95,597 | |
Other intangible assets, net | 13,513 | 16,244 | |
Deferred tax assets, net | 511 | 495 | |
Other assets | 3,074 | 3,088 | |
Total assets | 317,059 | 369,717 | |
Current liabilities: | |||
Accounts payable | 19,115 | 20,898 | |
Accrued liabilities | 26,240 | 18,997 | |
Accrued payroll and related expenses | 14,823 | 14,222 | |
Short-term borrowings | 23,600 | 20,000 | |
Income taxes payable | 2,125 | 1,306 | |
Total current liabilities | 85,903 | 75,423 | |
Long-term borrowings | 62,800 | 134,000 | |
Deferred tax liabilities, net | 11,050 | 18,949 | |
Other long-term liabilities | 1,817 | 1,958 | |
Total liabilities | 161,570 | 230,330 | |
Commitments and Contingencies (Note 11) | |||
Shareholders' equity: | |||
Common stock - authorized 36,000,000 shares, $0.001 par value; 19,729,774 and 19,688,238 shares issued at August 31, 2018 and 2017, respectively; and 13,850,413 and 13,984,183 shares outstanding at August 31, 2018 and 2017, respectively | 20 | 20 | |
Additional paid-in capital | 153,469 | 150,692 | |
Retained earnings | 351,266 | 315,764 | |
Accumulated other comprehensive income (loss) | (27,636) | (28,075) | |
Common stock held in treasury, at cost - 5,879,361 and 5,704,055 shares at August 31, 2018 and 2017, respectively | (321,630) | (299,014) | |
Total shareholders' equity | 155,489 | 139,387 | |
Total liabilities and shareholders' equity | $ 317,059 | $ 369,717 | |
[1] | Includes tangible assets and property and equipment, net, attributed to the geographic location in which such assets are located. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Consolidated Balance Sheets [Abstract] | ||
Trade and other accounts receivable, allowance for doubtful accounts | $ 340 | $ 240 |
Common stock, shares authorized | 36,000,000 | 36,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares issued | 19,729,774 | 19,688,238 |
Common stock, shares outstanding | 13,850,413 | 13,984,183 |
Treasury stock, shares | 5,879,361 | 5,704,055 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Consolidated Statements Of Operations [Abstract] | |||
Net sales | $ 408,518 | $ 380,506 | $ 380,670 |
Cost of products sold | 183,255 | 166,621 | 166,301 |
Gross profit | 225,263 | 213,885 | 214,369 |
Operating expenses: | |||
Selling, general and administrative | 121,394 | 114,560 | 117,767 |
Advertising and sales promotion | 22,314 | 20,537 | 22,278 |
Amortization of definite-lived intangible assets | 2,951 | 2,879 | 2,976 |
Total operating expenses | 146,659 | 137,976 | 143,021 |
Income from operations | 78,604 | 75,909 | 71,348 |
Other income (expense): | |||
Interest income | 454 | 508 | 683 |
Interest expense | (4,219) | (2,582) | (1,703) |
Other income | 339 | 787 | 2,461 |
Income before income taxes | 75,178 | 74,622 | 72,789 |
Provision for income taxes | 9,963 | 21,692 | 20,161 |
Net income | $ 65,215 | $ 52,930 | $ 52,628 |
Earnings per common share: | |||
Basic | $ 4.65 | $ 3.73 | $ 3.65 |
Diluted | $ 4.64 | $ 3.72 | $ 3.64 |
Shares used in per share calculations: | |||
Basic | 13,929 | 14,089 | 14,332 |
Diluted | 13,962 | 14,123 | 14,379 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Consolidated Statements Of Comprehensive Income [Abstract] | |||
Net income | $ 65,215 | $ 52,930 | $ 52,628 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment | 439 | (777) | (18,576) |
Total comprehensive income | $ 65,654 | $ 52,153 | $ 34,052 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Treasury Stock [Member] | Total |
Beginning balance at Aug. 31, 2015 | $ 20 | $ 141,651 | $ 260,683 | $ (8,722) | $ (235,774) | $ 157,858 |
Beginning balance, shares at Aug. 31, 2015 | 19,546,888 | 5,096,398 | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes | (1,434) | (1,434) | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes, shares | 74,932 | |||||
Stock-based compensation | 3,655 | 3,655 | ||||
Tax benefits from settlements of stock-based equity awards | 2,064 | 2,064 | ||||
Cash dividends | (23,669) | (23,669) | ||||
Acquisition of treasury stock | $ (32,131) | (32,131) | ||||
Acquisition of treasury stock, shares | 317,084 | |||||
Foreign currency translation adjustment | (18,576) | (18,576) | ||||
Net income | 52,628 | 52,628 | ||||
Ending balance at Aug. 31, 2016 | $ 20 | 145,936 | 289,642 | (27,298) | $ (267,905) | 140,395 |
Ending balance, shares at Aug. 31, 2016 | 19,621,820 | 5,413,482 | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes | (921) | (921) | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes, shares | 66,418 | |||||
Stock-based compensation | 4,138 | 4,138 | ||||
Tax benefits from settlements of stock-based equity awards | 1,539 | 1,539 | ||||
Cash dividends | (26,808) | (26,808) | ||||
Acquisition of treasury stock | $ (31,109) | (31,109) | ||||
Acquisition of treasury stock, shares | 290,573 | |||||
Foreign currency translation adjustment | (777) | (777) | ||||
Net income | 52,930 | 52,930 | ||||
Ending balance at Aug. 31, 2017 | $ 20 | 150,692 | 315,764 | (28,075) | $ (299,014) | $ 139,387 |
Ending balance, shares at Aug. 31, 2017 | 19,688,238 | 5,704,055 | 13,984,183 | |||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes | (1,607) | $ (1,607) | ||||
Issuance of common stock under share-based compensation plan, net of shares withheld for taxes, shares | 41,536 | |||||
Stock-based compensation | 4,195 | 4,195 | ||||
Cash dividends | (29,585) | (29,585) | ||||
Acquisition of treasury stock | $ (22,616) | (22,616) | ||||
Acquisition of treasury stock, shares | 175,306 | |||||
Foreign currency translation adjustment | 439 | 439 | ||||
Net income | 65,215 | 65,215 | ||||
Ending balance at Aug. 31, 2018 | $ 20 | 153,469 | 351,266 | $ (27,636) | $ (321,630) | $ 155,489 |
Ending balance, shares at Aug. 31, 2018 | 19,729,774 | 5,879,361 | 13,850,413 | |||
Cumulative effect of change in accounting principle | $ 189 | $ (128) | $ 61 |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Consolidated Statements Of Shareholders' Equity [Abstract] | |||
Cash dividends, per share | $ 2.11 | $ 1.89 | $ 1.64 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Operating activities: | |||
Net income | $ 65,215 | $ 52,930 | $ 52,628 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 7,800 | 6,769 | 6,465 |
Net gains on sales and disposals of property and equipment | (164) | (115) | (75) |
Deferred income taxes | (7,186) | 1,608 | (2,227) |
Stock-based compensation | 4,195 | 4,138 | 3,655 |
Unrealized foreign currency exchange losses (gains), net | (302) | 364 | (986) |
Provision for bad debts | 121 | (138) | 52 |
Changes in assets and liabilities: | |||
Trade accounts receivable | (5,635) | 482 | (9,936) |
Inventories | (1,299) | (3,487) | (1,001) |
Other assets | (5,353) | (3,514) | 1,557 |
Accounts payable and accrued liabilities | 6,107 | 2,827 | 2,871 |
Accrued payroll and related expenses | 590 | (6,632) | 8,120 |
Other long-term liabilities and income taxes payable | 733 | 340 | 4,179 |
Net cash provided by operating activities | 64,822 | 55,572 | 65,302 |
Investing activities: | |||
Purchases of property and equipment | (12,356) | (20,150) | (4,354) |
Proceeds from sales of property and equipment | 458 | 430 | 301 |
Purchase of intangible assets | (175) | ||
Purchases of short-term investments | (83,704) | (27,136) | (24,899) |
Maturities of short-term investments | 166,984 | 4,565 | 8,032 |
Net cash provided by (used in) investing activities | 71,207 | (42,291) | (20,920) |
Financing activities: | |||
Treasury stock purchases | (22,616) | (31,109) | (32,131) |
Dividends paid | (29,585) | (26,808) | (23,669) |
Proceeds from issuance of common stock | 215 | 775 | 1,200 |
Proceeds from issuance of long-term senior notes | 20,000 | ||
Repayments of long-term senior notes | (400) | ||
Net (repayments) proceeds from revolving credit facility | (87,200) | 32,000 | 14,000 |
Shares withheld to cover taxes upon conversion of equity awards | (1,823) | (1,696) | (2,634) |
Net cash used in financing activities | (121,409) | (26,838) | (43,234) |
Effect of exchange rate changes on cash and cash equivalents | (2,836) | (252) | (4,153) |
Net increase (decrease) in cash and cash equivalents | 11,784 | (13,809) | (3,005) |
Cash and cash equivalents at beginning of period | 37,082 | 50,891 | 53,896 |
Cash and cash equivalents at end of period | 48,866 | 37,082 | 50,891 |
Cash paid for: | |||
Interest | 4,286 | 2,625 | 1,573 |
Income taxes, net of tax refunds received | $ 10,478 | $ 21,933 | $ 16,494 |
The Company
The Company | 12 Months Ended |
Aug. 31, 2018 | |
The Company [Abstract] | |
The Company | Note 1. The Company WD-40 Company (“the Company”), based in San Diego, California, is a global marketing organization dedicated to creating positive lasting memories by developing and selling products that solve problems in workshops, factories and homes around the world. The Company markets its maintenance products and its homecare and cleaning products under the following well-known brands: WD-40®, 3-IN-ONE®, GT85®, X-14®, 2000 Flushes®, Carpet Fresh®, no vac®, Spot Shot®, 1001®, Lava® and Solvol®. Currently included in the WD-40 brand are the WD-40 Multi-Use Product and the WD-40 Specialist® and WD-40 BIKE® product lines. The Company’s brands are sold in various locations around the world. Maintenance products are sold worldwide in markets throughout North, Central and South America, Asia, Australia, Europe, the Middle East and Africa. Homecare and cleaning products are sold primarily in North America, the United Kingdom (“U.K.”) and Australia. The Company’s products are sold primarily through mass retail and home center stores, warehouse club stores, grocery stores, hardware stores, automotive parts outlets, sports retailers, independent bike dealers, online retailers and industrial distributors and suppliers . |
Basis Of Presentation And Summa
Basis Of Presentation And Summary Of Significant Accounting Policies | 12 Months Ended |
Aug. 31, 2018 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |
Basis Of Presentation And Summary Of Significant Accounting Policies | Note 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Supplier Risk The Company relies on a limited number of suppliers, including single or sole source suppliers for certain of its raw materials, packaging, product components and other necessary supplies. Where possible and where it makes business sense, the Company works with secondary or multiple suppliers to qualify additional supply sources. To date, the Company has been able to obtain adequate supplies of these materials which are used in the production of its maintenance products and homecare and cleaning products in a timely manner from existing sources. Cash and Cash Equivalents Cash equivalents are highly liquid investments purchased with an original maturity of three months or less. Short-term Investments The Company's short-term investments consist of term deposits and callable time deposits. These short-term investments had a carrying value of $0.2 million and $ 80.2 million at August 31, 2018 and 2017, respectively. The decrease in short-term investments during fiscal year 2018 was due to the maturity of the Company’s callable time deposits held by its U.K. subsidiary. These deposits matured in April 2018 and were not reinvested. As of August 31, 2018, the Company’s short-term investment balance consisted of term deposits that are subject to penalty for early redemption before their maturity. Trade Accounts Receivable and Allowance for Doubtful Accounts Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in existing accounts receivable. The Company determines the allowance for doubtful accounts based on historical write-off experience and the identification of specific balances deemed uncollectible. Trade accounts receivable are charged against the allowance when the Company believes it is probable that the trade accounts receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Allowance for doubtful accounts related to the Company’s trade accounts receivable were not significant at August 31, 2018 and 2017. Inventories Inventories are stated at the lower of cost or net realizable value. C ost is determined based on a first-in, first-out method or, for a portion of raw materials inventory, the average cost method. When necessary, the Company adjusts the carrying value of its inventory to the lower of cost or net realizable value , including any costs to sell or dispose of such inventory. Appropriate consideration is given by the Company to obsolescence, excessive inventory levels, product deterioration and other factors when evaluating net realizable value for the purposes of determining the lower of cost or net realizable value . Included in inventories are amounts for certain raw materials and components that the Company has provided to its third-party contract manufacturers but that remain unpaid to the Company as of the balance sheet date. The Company’s contract manufacturers package products to the Company’s specifications and, upon order from the Company, ship ready-to-sell inventory to either the Company’s third-party distribution centers or directly to its customers. The Company transfers certain raw materials and components to these contract manufacturers for use in the manufacturing process. Contract manufacturers are obligated to pay the Company for these raw materials and components upon receipt. Amounts receivable from the contract manufacturers as of the balance sheet date related to transfers of these raw materials and components by the Company to its contract manufacturers are considered product held at third-party contract manufacturers and are included in inventories in the accompanying consolidated balance sheets. Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method based upon estimated useful lives of ten to forty years for buildings and improvements, three to fifteen years for machinery and equipment, three to five years for vehicles, three to ten years for furniture and fixtures and three to five years for software and computer equipment. Depreciation expense totaled $4.8 million, $3.9 million and $3. 5 million for fiscal years 2018, 2017 and 2016, respectively. These amounts include factory depreciation expense which is recognized as cost of products sold and totaled $1.1 million for each of the fiscal years 2018 and 2017, respectively, and $0.8 million for fiscal year 2016. Software The Company capitalizes costs related to computer software obtained or developed for internal use. Software obtained for internal use has generally been enterprise-level business and finance software that the Company customizes to meet its specific operational needs. Costs incurred in the application development phase are capitalized and amortized over their useful lives, which are generally three to five years. Goodwill Goodwill represents the excess of the purchase price over the fair value of tangible and intangible assets acquired. The carrying value of goodwill is reviewed for possible impairment in accordance with the authoritative guidance on goodwill, intangibles and other. The Company assesses possible impairments to goodwill at least annually during its second fiscal quarter and otherwise when events or changes in circumstances indicate that an impairment condition may exist. In performing the annual impairment test of its goodwill, the Company considers the fair value concepts of a market participant and the highest and best use for its intangible assets. In addition to the annual impairment test, goodwill is evaluated each reporting period to determine whether events and circumstances would more likely than not reduce the fair value of a reporting unit below its carrying value. When testing goodwill for impairment, the Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative goodwill impairment test. If, after assessing qualitative factors, the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing a quantitative test is unnecessary. Otherwise, a quantitative test is performed to identify the potential impairment and to measure the amount of goodwill impairment, if any. Any required impairment losses are recorded as a reduction in the carrying amount of the related asset and charged to results of operations. No goodwill impairments were identified by the Company during fiscal years 2018, 2017 and 2016. Long-lived Assets The Company’s long-lived assets consist of property and equipment and definite-lived intangible assets. Long-lived assets are depreciated or amortized, as applicable, on a straight-line basis over their estimated useful lives. The Company assesses potential impairments to its long-lived assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable and/or its remaining useful life may no longer be appropriate. Any required impairment loss would be measured as the amount by which the asset’s carrying amount exceeds its fair value, which is the amount at which the asset could be bought or sold in a current transaction between willing market participants and would be recorded as a reduction in the carrying amount of the related asset and a charge to results of operations. An impairment loss would be recognized when the sum of the expected future undiscounted net cash flows is less than the carrying amount of the asset. No impairments to its long-lived assets were identified by the Company during fiscal years 2018, 2017 and 2016. Fair Value of Financial Instruments Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures” , defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its financial assets and liabilities measured at fair value into a hierarchy that categorizes fair value measurements into the following three levels based on the types of inputs used in measuring their fair value: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities; Level 2: Observable market-based inputs or observable inputs that are corroborated by market data; and Level 3: Unobservable inputs reflecting the Company’s own assumptions. Under fair value accounting, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of August 31, 2018, the Company had no assets or liabilities that are measured at fair value in the financial statements on a recurring basis, with the exception of the foreign currency forward contracts, which are classified as Level 2 within the fair value hierarchy. The carrying values of cash equivalents, short-term investments and short-term borrowings are recorded at cost, which approximates their fair values primarily due to their short-term maturities and are classified as Level 2 within the fair value hierarchy. In addition, the carrying value of borrowings held under the Company’s revolving credit facility approximates fair value due to the variable nature of underlying interest rates, which generally reflect market conditions and such borrowings are classified as Level 2 within the fair value hierarchy. The Company’s fixed rate long-term borrowings consist of senior notes which are also classified as Level 2 within the fair value hierarchy and are recorded at carrying value. The Company estimates that the fair value of its senior notes was approximately $18.8 million as of August 31, 2018, which was determined based on a discounted cash flow analysis using current market interest rates for instruments with similar terms, compared to its carrying value of $19.6 million. During the fiscal years ended August 31, 2018, 2017 and 2016, the Company did not record any significant nonrecurring fair value measurements for assets or liabilities in periods subsequent to their initial recognition. Concentration of Credit Risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents, short-term investments and trade accounts receivable. The Company’s policy is to place its cash in high credit quality financial institutions, in investments that include demand deposits, term deposits and callable time deposits. The Company’s trade accounts receivable are derived from customers located in North America, South America, Asia-Pacific, Europe, the Middle East, Africa and India. The Company limits its credit exposure from trade accounts receivable by performing on-going credit evaluations of customers, as well as insuring its trade accounts receivable in selected markets. Insurance Coverage The Company carries insurance policies to cover insurable risks such as property damage, business interruption, product liability, workers’ compensation and other risks, with coverage and other terms that it believes to be adequate and appropriate. These policies may be subject to applicable deductible or retention amounts, coverage limitations and exclusions. The Company does not maintain self-insurance with respect to its material risks; therefore, the Company has not provided for self-insurance reserves as of August 31, 2018 and 2017. Revenue Recognition and Sales Incentives Sales are recognized as revenue at the time of delivery to the customer when risks of loss and title have passed. Sales are recorded net of allowances for damaged goods and other sales returns, sales incentives, trade promotions and cash discounts. The Company records the costs of promotional activities such as sales incentives, trade promotions, coupon offers and cash discounts that are given to its customers as a reduction of sales in its consolidated statements of operations. The Company offers on-going trade promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs for such programs. Programs include cooperative marketing programs, shelf price reductions, coupons, rebates, consideration and allowances given to retailers for shelf space and/or favorable display positions in their stores and other promotional activities. Costs related to rebates, cooperative advertising and other promotional activities are recorded as a reduction to sales upon delivery of the Company’s products to its customers. Coupon costs are based upon historical redemption rates and are recorded as a reduction to sales as incurred, which is when the coupons are circulated. Cost of Products Sold Cost of products sold primarily includes the cost of products manufactured on the Company’s behalf by its third-party contract manufacturers, net of volume and other rebates. Cost of products sold also includes the costs to manufacture WD-40 concentrate, which is done at the Company’s own facilities or at third-party contract manufacturers. When the concentrate is manufactured by the Company, cost of products sold includes direct labor, direct materials and supplies; in-bound freight costs related to purchased raw materials and finished product; and depreciation of machinery and equipment used in the manufacturing process. Selling, General and Administrative Expenses Selling, general and administrative expenses include costs related to selling the Company’s products, such as the cost of the sales force and related sales and broker commissions; shipping and handling costs paid to third-party companies to distribute finished goods from the Company’s third-party contract manufacturers and distribution centers to its customers; other general and administrative costs related to the Company’s business such as general overhead, legal and accounting fees, insurance, and depreciation; and other employee-related costs to support marketing, human resources, finance, supply chain, information technology and research and development activities. Shipping and Handling Costs Shipping and handling costs associated with in-bound freight and movement of product from third-party contract manufacturers to the Company’s third-party warehouses are capitalized in the cost of inventory and subsequently included in cost of sales when recognized in the statement of operations. Shipping and handling costs associated with out-bound transportation are included in selling, general and administrative expenses and are recorded at the time of shipment of product to the Company’s customers. Out-bound shipping and handling costs were $17.7 million, $16.4 million and $16.1 million for fiscal years 2018, 2017 and 2016, respectively. Advertising and Sales Promotion Expenses Advertising and sales promotion expenses are expensed as incurred. Advertising and sales promotion expenses include costs associated with promotional activities that the Company pays to third parties, which include costs for advertising (television, print media and internet), administration of coupon programs, consumer promotions, product demonstrations, public relations, agency costs, package design expenses and market research costs. Total advertising and sales promotion expenses were $22.3 million, $20.5 million and $22.3 million for fiscal years 2018, 2017 and 2016, respectively. Research and Development The Company is involved in research and development efforts that include the ongoing development or innovation of new products and the improvement, extension or renovation of existing products or product lines. All research and development costs are expensed as incurred and are included in selling, general and administrative expenses. Research and development expenses were $7.0 million, $8.4 million and $7.7 million in fiscal years 2018, 2017 and 2016, respectively. These expenses include costs associated with general research and development activities, as well as those associated with internal staff, overhead, design testing, market research and consultants. Income Taxes Current income tax expense is the amount of income taxes expected to be payable for the current year. A deferred income tax liability or asset is established for the expected future tax consequences resulting from the differences in financial reporting and tax bases of assets and liabilities. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. In addition to valuation allowances, the Company provides for uncertain tax positions when such tax positions do not meet the recognition thresholds or measurement standards prescribed by the authoritative guidance on income taxes. Amounts for uncertain tax positions are adjusted in periods when new information becomes available or when positions are effectively settled. The Company recognizes accrued interest and penalties related to uncertain tax positions as a component of income tax expense. As a result of the “Tax Cuts and Jobs Act” (the “Tax Act”) which became effective beginning January 1, 2018, the U.S. has transitioned from a worldwide tax system to a modified territorial tax system, under which corporations are primarily taxed on income earned within the country’s borders, rather than on a worldwide basis. The Company is still required to make assertions on whether its foreign subsidiaries will invest their undistributed earnings indefinitely and these assertions are based on the capital needs of the foreign subsidiaries. Due to the passage of the Tax Act, the Company began reevaluating the indefinite reinvestment assertion for its foreign subsidiaries. In May 2018, the Company completed this reevaluation and changed its indefinite reinvestment assertion for certain of its foreign subsidiaries. As a result, the Company no longer considers unremitted earnings of any of its foreign subsidiaries to be indefinitely reinvested. For additional information on the Tax Act, see Note 12 — Income Taxes, included in this report. Foreign Currency The Company translates the assets and liabilities of its foreign subsidiaries into U.S. dollars at current rates of exchange in effect at the end of the reporting period. Income and expense items are translated at rates that approximate the rates in effect at the transaction date. Gains and losses from translation are included in accumulated other comprehensive income or loss. Gains or losses resulting from foreign currency transactions (transactions denominated in a currency other than the entity’s functional currency) are included as other income in the Company’s consolidated statements of operations. The Company had $0.1 million, $0.4 million and $2 .4 million of net gains in foreign currency transactions in fiscal years 2018, 2017 and 2016, respectively. In the normal course of business, the Company employs established policies and procedures to manage its exposure to fluctuations in foreign currency exchange rates. The Company’s U.K. subsidiary, whose functional currency is Pound Sterling, utilizes foreign currency forward contracts to limit its exposure to net asset balances held in non-functional currencies, specifically the Euro. The Company regularly monitors its foreign currency exchange rate exposures to ensure the overall effectiveness of its foreign currency hedge positions. While the Company engages in foreign currency hedging activity to reduce its risk, for accounting purposes, none of its foreign currency forward contracts are designated as hedges. Foreign currency forward contracts are carried at fair value, with net realized and unrealized gains and losses recognized currently in other income (expense) in the Company’s consolidated statements of operations. Cash flows from settlements of foreign currency forward contracts are included in operating activities in the consolidated statements of cash flows. Foreign currency forward contracts in an asset position at the end of the reporting period are included in other current assets, while foreign currency forward contracts in a liability position at the end of the reporting period are included in accrued liabilities in the Company’s consolidated balance sheets. At August 31, 2018, the Company had a notional amount of $ 23 .1 million outstanding in foreign currency forward contracts, which matured in September 2018 . Unrealized net gains related to foreign currency forward contracts were not significant at August 31, 2018, while unrealized net losses were $0.6 million at August 31, 2017. Realized net losses related to foreign currency forward contracts were not significant for the fiscal year ended August 31, 2018, while realized net losses were $0.5 million for the fiscal year ended August 31, 2017. Both unrealized and realized net gains and losses are recorded in other income on the Company’s consolidated statements of operations. Earnings per Common Share Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents, whether paid or unpaid, are participating securities that are required to be included in the computation of earnings per common share pursuant to the two-class method. Accordingly, the Company’s outstanding unvested, if any, and outstanding vested stock-based equity awards that provide such nonforfeitable rights to dividend equivalents are included as participating securities in the calculation of earnings per common share (“EPS”) pursuant to the two-class method. The Company calculates EPS using the two-class method, which provides for an allocation of net income between common stock and other participating securities based on their respective participation rights to share in dividends. Basic EPS is calculated by dividing net income available to common shareholders for the period by the weighted-average number of common shares outstanding during the period. Net income available to common shareholders for the period includes dividends paid to common shareholders during the period plus a proportionate share of undistributed net income allocable to common shareholders for the period; the proportionate share of undistributed net income allocable to common shareholders for the period is based on the proportionate share of total weighted-average common shares and participating securities outstanding during the period. Diluted EPS is calculated by dividing net income available to common shareholders for the period by the weighted-average number of common shares outstanding during the period increased by the weighted-average number of potentially dilutive common shares (dilutive securities) that were outstanding during the period if the effect is dilutive. Dilutive securities are comprised of various types of stock-based equity awards granted under the Company’s prior and current equity incentive plans. Stock-based Compensation The Company accounts for stock-based equity awards exchanged for employee and non-employee director services in accordance with the authoritative guidance for share-based payments. Stock-based equity awards are measured at the grant date, based on the estimated fair value of the award, and are recognized as stock-based compensation expense on a straight-line basis over the requisite service period of the entire award, net of the impacts of award forfeitures as they occur. The requisite service period is generally the maximum vesting period of the award. Compensation expense related to the Company’s stock-based equity awards is recorded as selling, general and administrative expenses in the Company’s consolidated statements of operations. The fair value of stock options is determined using a Black-Scholes option pricing model. The fair values of restricted stock unit awards and deferred performance unit awards are based on the fair value of the Company’s common stock on the date that such awards are granted. The fair value of market share unit awards is determined using a Monte Carlo simulation model. For the deferred performance unit awards, the Company adjusts the compensation expense over the service period based upon the expected achievement level of the applicable performance condition. As the grant date fair value of market share unit awards reflects the probabilities of the actual number of such awards expected to vest, compensation expense for such awards is not adjusted based on the expected achievement level of the applicable performance condition. The Company records any excess tax benefits or deficiencies from settlements of its stock-based equity awards within the provision for income taxes on the Company’s consolidated statements of operations in the reporting periods in which the settlement of the equity awards occur. Segment Information The Company discloses certain information about its business segments, which are determined consistent with the way the Company’s Chief Operating Decision Maker organizes and evaluates financial information internally for making operating decisions and assessing performance. In addition, the Chief Operating Decision Maker assesses and measures revenue based on product groups. Recently Adopted Accounting Standards In March 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2018-05, “Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118” , to add various SEC paragraphs pursuant to the issuance of SEC Staff Accounting Bulletin No. 118 (“SAB 118”), to ASC 740 “Income Taxes” . SAB 118 was issued by the SEC in December 2018 to provide immediate guidance for accounting implications of U.S. tax reform under the “ Tax Cuts and Jobs Act ” (the “Tax Act”), which became effective for the Company on January 1, 2018. The Company has evaluated the potential impacts of SAB 118 and has applied this guidance to its consolidated financial statements and related disclosures beginning in the second quarter of its fiscal year 2018. For additional information on SAB 118 and the impacts of the Tax Act on the Company’s consolidated financial statements and related disclosures, see Note 12 — Income Taxes, included in this report . In January 2017, the FASB issued ASU No. 2017-04, “ Simplifying the Test for Goodwill Impairment ”. The amendments in this updated guidance simplify how an entity is required to test goodwill for impairment due to concerns that were raised about the cost and complexity of annual impairment tests under the existing standard. This updated guidance eliminates Step 2 of the previous two-step quantitative model for goodwill impairment tests. Step 2 required an entity to calculate an implied fair value, which includes a hypothetical purchase price allocation requirement, for reporting units that failed Step 1. Per this updated guidance, a goodwill impairment will instead be measured as the amount by which a reporting unit’s carrying value exceeds its fair value as identified in Step 1. Step 1 will be referred to simply as a “quantitative goodwill impairment test” subsequent to the Company’s adoption of this updated guidance, since Step 2 has been eliminated and “steps” are no longer referred to within the updated guidance. However, the updated guidance still permits the Company to first conduct a qualitative assessment to determine whether it is necessary to perform a quantitative goodwill impairment test. This guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within that reporting period. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company early adopted this guidance in its fiscal year 2018 during the second quarter, the period in which the Company performs its annual goodwill impairment test. The guidance was adopted on a prospective basis and is applicable to all of the Company’s future annual goodwill impairment tests. T he adoption of this guidance did not have an impact on the Company’s consolidated financial statements and related disclosures. See Note 5 – Goodwill and Other Intangible Assets for additional information on the Company’s goodwill. In March 2016, the FASB issued ASU No. 2016-09, “ Improvements to Employee Share-Based Payment Accounting”. The amendments in this updated guidance include changes to simplify the Codification for several aspects of the accounting for share-based payment transactions, including those related to the income tax consequences, classification of awards as either equity or liabilities, accounting for forfeitures, minimum statutory withholding requirements and classification of certain items on the statement of cash flows. Certain of these changes are required to be applied retrospectively while other changes are required to be applied prospectively. This guidance is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. Early adoption was permitted. The Company did not adopt this updated guidance early and therefore this guidance became effective for the Company during the first quarter of its fiscal year 2018. The impacts of the adoption by the Company of ASU No. 2016-09 in fiscal year 2018 were as follows: · The Company recorded excess tax benefits of $0.7 million within the provision for income taxes for fiscal year 2018 from settlements of stock-based equity awards. Prior to the adoption of this new guidance, these amounts would have been recorded as an increase to additional paid-in capital. · The Company elected to change its policy related to forfeitures of stock-based equity awards upon adoption of this new guidance such that it will now recognize the impacts of forfeitures as they occur rather than recognizing them based on an estimated forfeiture rate. As a result, the Company recorded a cumulative-effect adjustment to retained earnings. This adjustment to retained earnings and the impact of this change in policy for forfeitures on the Company’s consolidated financial statements was not material. · The Company elected to apply the presentation requirements for the statement of cash flows related to excess tax benefits from settlements of stock-based equity awards retrospectively for all periods presented which resulted in an increase of $1.5 million and $2.1 million, respectively, to both net cash provided by operating activities and net cash used in financing activities for fiscal years 2017 and 2016, respectively. · The Company’s presentation in the statement of cash flows of employee taxes paid upon settlement of certain stock-based equity awards via shares withheld by the Company for tax-withholding purposes also changed as a result of the adoption of this new guidance since the Company previously reported such activity as an operating activity rather than a financing activity. As required, the Company applied this change in presentation for the statement of cash flows retrospectively for all periods presented which resulted in an increase of $1.7 million and $2.6 million, respectively, to both net cash provided by operating activities and net cash used in financing activities for fiscal years 2017 and 2016, respectively. · The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of its diluted earnings per share for the fiscal year ended August 31, 2018. The resulting increase in the Company’s diluted weighted average common shares outstanding was not material. Recently Issued Accounting Standards In August 2018, the FASB issued ASU No. 2018-15, “ Customer’s Accounting |
Inventories
Inventories | 12 Months Ended |
Aug. 31, 2018 | |
Inventories [Abstract] | |
Inventories | Note 3. Inventories Inventories consisted of the following (in thousands): August 31, August 31, 2018 2017 Product held at third-party contract manufacturers $ 2,841 $ 3,021 Raw materials and components 3,692 3,021 Work-in-process 448 215 Finished goods 29,555 29,083 Total $ 36,536 $ 35,340 |
Property And Equipment
Property And Equipment | 12 Months Ended |
Aug. 31, 2018 | |
Property And Equipment [Abstract] | |
Property And Equipment | Note 4. Property and Equipment Property and equipment, net, consisted of the following (in thousands): August 31, August 31, 2018 2017 Machinery, equipment and vehicles $ 17,848 $ 17,491 Buildings and improvements 17,100 16,953 Computer and office equipment 5,046 4,552 Software 9,481 7,947 Furniture and fixtures 1,820 1,608 Capital in progress 8,042 861 Land 3,453 3,453 Subtotal 62,790 52,865 Less: accumulated depreciation and amortization (26,433) (23,426) Total $ 36,357 $ 29,439 At August 31, 2018, capital in progress on the balance sheet included £5.6 million Pound Sterling ( $7.3 million in U.S. Dollars as converted at exchange rates as of August 31, 2018) associated with capital costs related to the purchase of the Company’s new office building and related land in Milton Keynes, England, which will house employees of the Company’s EMEA segment that are based in the United Kingdom. The Company expects to incur additional capital costs related to the buildout of the acquired building and for the purchase of new furniture, fixtures and equipment. Upon completion of the buildout, the Company will place these assets into service and reclassify the amounts recorded in capital in progress to the respective fixed asset categories, which includes amounts attributable to the land. Since all assets associated with this new office building are denominated in Pound Sterling, amounts will fluctuate in U.S. Dollars from period to period due to changes in foreign currency exchange rates. For further information, see the Liquidity and Capital Resources section in Part II—Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”. |
Goodwill And Other Intangible A
Goodwill And Other Intangible Assets | 12 Months Ended |
Aug. 31, 2018 | |
Goodwill And Other Intangible Assets [Abstract] | |
Goodwill And Other Intangible Assets | Note 5. Goodwill and Other Intangible Assets Acquisitions During the first quarter of fiscal year 2018, the Company entered into a confidential settlement agreement with FirstPower Group, LLC (“FirstPower”) for dismissal of FirstPower’s trademark infringement complaint against the Company relating to use of the words, “EZ-REACH” for the Company’s WD-40 EZ-REACH Flexible Straw product. The settlement agreement provided for the Company’s acquisition of FirstPower’s trademark rights associated with the words “EZ REACH” for lubricating oil products for a purchase consideration of $0.2 million. The Company has used the words “EZ-REACH” since the introduction of the WD-40 EZ-REACH Flexible Straw product in fiscal year 2015. The entire purchase consideration of $0.2 million was paid in cash upon execution of the settlement agreement and was allocated to the trade name-related intangible assets category. The Company began to amortize this definite-lived intangible asset on a straight-line basis over an estimated useful life of five years in the first quarter of fiscal year 2018. This acquisition did not have a material impact on the Company’s condensed consolidated financial statements. Goodwill The following table summarizes the changes in the carrying amounts of goodwill by segment (in thousands): Americas EMEA Asia-Pacific Total Balance as of August 31, 2016 $ 85,452 $ 8,987 $ 1,210 $ 95,649 Translation adjustments (4) (48) - (52) Balance as of August 31, 2017 85,448 8,939 1,210 95,597 Translation adjustments 1 23 - 24 Balance as of August 31, 2018 $ 85,449 $ 8,962 $ 1,210 $ 95,621 During the second quarter of fiscal year 2018, the Company performed its annual goodwill impairment test. The annual goodwill impairment test was performed at the reporting unit level as required by the authoritative guidance as of the Company’s most recent goodwill impairment testing date, November 30, 2017. During the fiscal year 2018 annual goodwill impairment test, the Company performed a qualitative assessment of each reporting unit to determine whether it was more likely than not that the fair value of a reporting unit was less than its carrying amount. In performing this qualitative assessment, the Company assessed relevant events and circumstances that may impact the fair value and the carrying amount of each of its reporting units. Factors that were considered included, but were not limited to, the following: (1) macroeconomic conditions; (2) industry and market conditions; (3) historical financial performance and expected financial performance, including the anticipated impacts of the “ Tax Cuts and Jobs Act ”, which was signed into law on December 22, 2017 and became effective beginning January 1, 2018 ; (4) other entity specific events, such as changes in management or key personnel; and (5) events affecting the Company’s reporting units, such as a change in the composition of net assets or any expected dispositions. Based on the results of this qualitative assessment, the Company determined that it is more likely than not that the carrying value of each of its reporting units is less than its fair value as of the goodwill impairment testing date and, thus, a quantitative analysis was not required. As a result, the Company concluded that no impairment of its goodwill existed as of February 28, 2018 . In addition, there were no indicators of impairment identified as a result of the Company’s review of events and circumstances related to its goodwill subsequent to February 28, 2018, t he date of its most recent annual goodwill impairment test. To date, there have been no impairment losses identified and recorded related to the Company’s goodwill. Definite-lived Intangible Assets The Company’s definite-lived intangible assets, which include the 2000 Flushes, Spot Shot, Carpet Fresh, 1001, EZ REACH and GT85 trade names, the Belgium customer list, the GT85 customer relationships and the GT85 technology are included in other intangible assets, net in the Company’s condensed consolidated balance sheets. The following table summarizes the definite-lived intangible assets and the related accumulated amortization (in thousands) : August 31, August 31, 2018 2017 Gross carrying amount $ 36,122 $ 35,891 Accumulated amortization (22,609) (19,647) Net carrying amount $ 13,513 $ 16,244 There has be en no impairment charge for the period ended August 31, 2018 as a result of the Company’s review of events and circumstances related to its existing definite-lived intangible assets. Changes in the carrying amounts of definite-lived intangible assets by segment are summarized below (in thousands): Americas EMEA Asia-Pacific Total Balance as of August 31, 2016 $ 14,913 $ 4,278 $ - $ 19,191 Amortization expense (2,207) (672) - (2,879) Translation adjustments - (68) - (68) Balance as of August 31, 2017 12,706 3,538 - 16,244 Amortization expense (2,237) (714) - (2,951) EZ REACH trade name 175 - - 175 Translation adjustments - 45 - 45 Balance as of August 31, 2018 $ 10,644 $ 2,869 $ - $ 13,513 The estimated amortization expense for the Company’s definite-lived intangible assets in future fiscal years is as follows (in thousands): Trade Names Customer-Based Fiscal year 2019 $ 2,455 $ 260 Fiscal year 2020 2,055 166 Fiscal year 2021 1,266 166 Fiscal year 2022 1,266 166 Fiscal year 2023 1,020 - Thereafter 4,693 - Total $ 12,755 $ 758 Included in the total estimated future amortization expense is the amortization expense for the 1001 trade name and the GT85 intangible assets, which are based on current foreign currency exchange rates, and as a result amounts in future periods may differ from those presented due to fluctuations in those rates. |
Accrued And Other Liabilities
Accrued And Other Liabilities | 12 Months Ended |
Aug. 31, 2018 | |
Accrued And Other Liabilities [Abstract] | |
Accrued And Other Liabilities | Note 6. Accrued and Other Liabilities Accrued liabilities consisted of the following (in thousands): August 31, August 31, 2018 2017 Accrued advertising and sales promotion expenses $ 11,972 $ 10,889 Accrued professional services fees 1,712 1,456 Accrued sales taxes and other taxes 1,642 1,701 Accrued liability forward contract (1) 6,893 - Other 4,021 4,951 Total $ 26,240 $ 18,997 (1) This accrued liability relates to a foreign currency forward contract that the Company’s U.K. subsidiary entered into with Bank of America to sell U.S. Dollars and receive Pound Sterling. This foreign currency forward contract matured on August 30, 2018, but the settlement of the c urrencies in the amount of $6.9 million did not occur until September 4, 2018. As a result, as of August 31, 2018, the Company owed Bank of America $6.9 million which was recorded in accrued and other liabilities. Bank of America also owed the Company $6.9 million equivalent in Pound Sterling and this was recorded in other current assets as of August 31, 2018. Accrued payroll and related expenses consisted of the following (in thousands): August 31, August 31, 2018 2017 Accrued incentive compensation $ 6,719 $ 6,554 Accrued payroll 3,792 3,338 Accrued profit sharing 2,561 2,257 Accrued payroll taxes 1,236 1,503 Other 515 570 Total $ 14,823 $ 14,222 |
Debt
Debt | 12 Months Ended |
Aug. 31, 2018 | |
Debt [Abstract] | |
Debt | Note 7. Debt As of August 31, 2018, the Company held borrowings under two separate agreements as detailed below. Note Purchase and Private Shelf Agreement On November 15, 2017, the Company entered into the Note Purchase and Private Shelf Agreement (the “Note Agreement”) by and among the Company, PGIM, Inc. (“Prudential”), and certain affiliates and managed accounts of Prudential (the “Note Purchasers”), pursuant to which the Company agreed to sell $20.0 million aggregate principal amount of senior notes (the “Series A Notes”) to certain of the Note Purchasers. The Series A Notes will bear interest at 3.39% per annum and will mature on November 15, 2032 , unless earlier paid by the Company. Principal payments are required semi-annually beginning on May 15, 2018 in equal installments of $0.4 million through May 15, 2032 , and the remaining outstanding principal in the amount of $8.4 million will become due on November 15, 2032. Interest is also payable semi-annually beginning on May 15, 2018. The Company used the proceeds to pay down $20.0 million of short-term borrowings under the Company’s existing $175.0 million unsecured Credit Agreement during fiscal year 2018 . On February 23, 2018, this Note Agreement was amended (the “Note Amendment”) in connection with the purchase of the Company’s new office building and related land located in Milton Keynes, England, (the “Property”). The Note Amendment amends the Note Agreement to permit the Company to spend an aggregate amount not to exceed $15.0 million for the acquisition and improvement costs for the Property through the end of the Company’s fiscal year 2019. During the twelve months ended August 31, 2018, the Company repaid $0.4 million in principal on the Series A Notes pursuant to its semi-annual principal payment requirements. Pursuant to the Note Agreement, the Company may from time to time offer for sale, in one or a series of transactions, additional senior notes of the Company (the “Shelf Notes”) in an aggregate principal amount of up to $105.0 million. The Shelf Notes will have a maturity date of no more than 15½ years after the date of original issuance and may be issued no later than November 15, 2020 . The Shelf Notes, if issued, would bear interest at a rate per annum as agreed upon amongst the Company and the purchasing parties and would have such other particular terms, as would be set forth in a confirmation of acceptance executed by the purchasing parties prior to the closing of each purchase and sale transaction. To date, the Company has issued no Shelf Notes. Pursuant to the Note Agreement, the Series A Notes and any Shelf Notes (collectively, the "Notes") can be prepaid at the Company’s sole discretion, in whole at any time or in part from time to time, at 100% of the principal amount of the Notes being prepaid, together with accrued and unpaid interest thereon as well as an additional make-whole payment with respect to such Notes. Credit Agreement On June 17, 2011, the Company entered into an unsecured Credit Agreement (the “Credit Agreement”) with Bank of America, N.A. (“Bank of America”). Since June 17, 2011, this unsecured credit agreement has been amended six times, most recently on November 15, 2017, (the “Fifth Amendment”) and on February 23, 2018, (the “Sixth Amendment”). The Fifth Amendment amended certain provisions and covenants in the Credit Agreement to generally conform them to the corresponding provisions and covenants contained in the Note Agreement and permits the Company to incur indebtedness arising under the Note Agreement in an aggregate principal amount not to exceed the $20.0 million, the amount of the Series A Notes sold pursuant to the Note Agreement in November 2017. The Sixth Amendment amended the Credit Agreement to permit the Company to spend an aggregate amount not to exceed $15.0 million for the acquisition and improvement costs for the Company’s new office building and related land in Milton Keynes, England, through the end of the Company’s fiscal year 2019. The Sixth Amendment also permits the Company to incur an additional $15.0 million of indebtedness under the Note Agreement by issuance and sale of Shelf Notes pursuant to the Note Agreement. Per the terms of the amended agreement, the revolving commitment may not exceed $175.0 million and the aggregate amount of the Company’s capital stock that it may repurchase may not exceed $150.0 million during the period from November 16, 2015 to the maturity date of the agreement so long as no default exists immediately prior and after giving effect thereto. This revolving credit facility matures on May 13, 2020 . In addition, as allowed per the terms of the Credit Agreement, the Company and Bank of America entered into an autoborrow agreement providing for the automatic advance of revolving loans in U.S. Dollars to the Company’s designated account at Bank of America. This agreement was entered into during the second quarter of fiscal year 2016 and this agreement has been in effect since that time. Since the autoborrow feature provides for borrowings to be made and repaid by the Company on a daily basis, any such borrowings made under an active autoborrow agreement are classified as short-term on the Company’s consolidated balance sheets. The Company had $2.8 million in net borrowings outstanding under the autoborrow agreement as of August 31, 2018. During the first half of fiscal year 2018, the Company repaid $20.0 million in borrowings outstanding under the line of credit by utilizing the proceeds from the $20.0 million in Series A Notes issued in November 2017 and subsequently borrowed $10.0 million under the revolving credit facility during the remainder of fiscal year 2018. In addition, as a result of the “ Tax Cuts and Jobs Act ” (the “Tax Act”) which became effective beginning January 1, 2018, the Company began reevaluating its indefinite reinvestment assertion for its foreign subsidiaries. In May 2018, the Company completed this reevaluation and changed its indefinite reinvestment assertion for certain of its foreign subsidiaries. As a result, the Company no longer considers unremitted earnings of any of its foreign subsidiaries to be indefinitely reinvested. For additional information on the Tax Act, see Note 12 — Income Taxes, included in this report. The Company repatriated a portion of its unremitted foreign earnings during the fourth quarter of fiscal year 2018 in the amount of $79.6 million from its U.K. subsidiary and used these funds to wards repaying $80.0 million of outstanding draws on the line of credit. The Company assesses its ability and intent to refinance the outstanding draws on the line of credit at the end of each reporting period in order to determine the proper balance sheet classification for amounts outstanding on the line of credit. Outstanding draws on the line of credit which the Company intends to repay in less than twelve months are classified as short-term. Outstanding draws for which management has the ability and intent to refinance with successive short- term borrowings for a period of at least twelve months are classified as long-term. As of August 31, 2018, the Company ha d a balance of $64.0 million of outstanding draws on the line of credit , of which $44.0 million was classified as long-term based on management’s ability and intent to refinance with successive short-term borrowings for a period of at least twelve months . The remaining $20.0 million of outstanding draws was classified as short-term as of August 31, 2018. Short-term and long-term borrowings consisted of the following (in thousands): August 31, August 31, 2018 2017 Short-term borrowings: Revolving credit facility, short-term $ 20,000 $ 20,000 Revolving credit facility, autoborrow feature 2,800 - Series A Notes, current portion of long-term debt 800 - Total short-term borrowings 23,600 20,000 Long-term borrowings: Revolving credit facility 44,000 134,000 Series A Notes 18,800 - Total long-term borrowings 62,800 134,000 Total $ 86,400 $ 154,000 Both the Note Agreement and the Credit Agreement contain representations, warranties, events of default and remedies, as well as affirmative, negative and other financial covenants customary for these types of agreements. These covenants include, among other things, certain limitations on the ability of the Company and its subsidiaries to incur indebtedness, create liens, dispose of assets, make investments, repurchase shares of the Company’s capital stock and enter into certain merger or consolidation transactions. Each agreement also includes a most favored lender provision which requires that any time any other lender has the benefit of one or more financial or operational covenants that is different than, or similar to, but more restrictive than those contained in its own agreement, those covenants shall be immediately and automatically incorporated by reference in the other lender’s agreement. Both the Note Agreement and the Credit Agreement require the Company to adhere to the same financial covenants. For the financial covenants, the definition of consolidated EBITDA includes the add back of non-cash stock-based compensation to consolidated net income when arriving at consolidated EBITDA. The terms of the financial covenants are as follows: · The consolidated leverage ratio cannot be greater than three to one. The consolidated leverage ratio means, as of any date of determination, the ratio of (a) consolidated funded indebtedness as of such date to (b) consolidated EBITDA for the most recently completed four fiscal quarters. · The consolidated interest coverage ratio cannot be less than three to one. The consolidated interest coverage ratio means, as of any date of determination, the ratio of (a) consolidated EBITDA for the most recently completed four fiscal quarters to (b) consolidated interest charges for the most recently completed four fiscal quarters. As of August 31, 2018 the Company was in compliance with all debt covenants under both the Note Agreement and the Credit Agreement . |
Share Repurchase Plan
Share Repurchase Plan | 12 Months Ended |
Aug. 31, 2018 | |
Share Repurchase Plan [Abstract] | |
Share Repurchase Plan | Note 8. Share Repurchase Plans On June 21, 2016, the Company’s Board of Directors approved a share buy-back plan. Under the plan, which became effective on September 1, 2016, the Company was authorized to acquire up to $75.0 million of its outstanding shares through August 31, 2018. The timing and amount of repurchases were based on terms and conditions that were acceptable to the Company’s Chief Executive Officer and Chief Financial Officer and in compliance with all laws and regulations applicable thereto . During the period from September 1, 2016 through August 31, 2018, the Company repurchased 465,879 shares at a total cost of $53.7 million under this $75.0 million plan. During fiscal year 2018, the Company repurchased 175,306 shares at an average price of $128.99 per share, for a total cost of $22.6 million On June 19, 2018, the Company’s Board of Directors approved a new share buy-back plan. Under the plan, which became effective on September 1, 2018 and will remain in effect through August 31, 2020, the Company is authorized to acquire up to $75.0 million of its outstanding shares on terms and conditions as may be acceptable to the Company’s Chief Executive Officer and Chief Financial Officer and in compliance with all laws and regulations thereto. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Aug. 31, 2018 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | Note 9. Earnings per Common Share The table below reconciles net income to net income available to common shareholders (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Net income $ 65,215 $ 52,930 $ 52,628 Less: Net income allocated to participating securities (423) (323) (334) Net income available to common shareholders $ 64,792 $ 52,607 $ 52,294 The table below summarizes the weighted-average number of common shares outstanding included in the calculation of basic and diluted EPS (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Weighted-average common shares outstanding, basic 13,929 14,089 14,332 Weighted-average dilutive securities 33 34 47 Weighted-average common shares outstanding, diluted 13,962 14,123 14,379 There were no anti-dilutive stock-based equity awards outstanding for the fiscal years ended August 31, 2018 and 2017. For the fiscal year ended August 31, 2016, weighted-average stock-based equity awards outstanding that are non-participating securities in the amount of 4,501 were excluded from the calculation of diluted EPS under the treasury stock method as they were anti-dilutive. |
Related Parties
Related Parties | 12 Months Ended |
Aug. 31, 2018 | |
Related Parties [Abstract] | |
Related Parties | Note 10. Related Parties On October 11, 2011, the Company’s Board of Directors elected Mr. Gregory A. Sandfort as a director of WD-40 Company. Mr. Sandfort is the Chief Executive Officer of Tractor Supply Company (“Tractor Supply”), which is a WD-40 Company customer that acquires products from the Company in the ordinary course of business. The consolidated financial statements include sales to Tractor Supply of $1.4 million for fiscal year 2018 and $1.2 million for each of the fiscal years 201 7 and 201 6, respectively . Accounts receivable from Tractor Supply were $0.5 million as of August 31, 2018 and were not significant as of August 31, 2017. |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Aug. 31, 2018 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | Note 11. Commitments and Contingencies Leases The Company was committed under certain non-cancellable capital and operating leases at August 31, 2018. The Company's capital leases were not significant as of August 31, 2018. The Company’s leases provide for the following future fiscal year minimum payments (in thousands): 2019 2020 2021 2022 2023 Thereafter Leases $ 2,003 $ 1,517 $ 1,168 $ 694 $ 379 $ 1,198 Rent expense was $2.0 million, $2.1 million, and $1.9 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. Purchase Commitments The Company has ongoing relationships with various suppliers (contract manufacturers) who manufacture the Company’s products. The contract manufacturers maintain title and control of certain raw materials and components, materials utilized in finished products, and of the finished products themselves until shipment to the Company’s customers or third-party distribution centers in accordance with agreed upon shipment terms. Although the Company has definitive minimum purchase obligations included in the contract terms with certain of its contract manufacturers, when such obligations have been included, they have either been immaterial or the minimum amounts have been such that they are well below the volume of goods that the Company has historically purchased. In the ordinary course of business, supply needs are communicated by the Company to its contract manufacturers based on orders and short-term projections, ranging from two to five months. The Company is committed to purchase the products produced by the contract manufacturers based on the projections provided. Upon the termination of contracts with contract manufacturers, the Company obtains certain inventory control rights and is obligated to work with the contract manufacturer to sell through all product held by or manufactured by the contract manufacturer on behalf of the Company during the termination notification period. If any inventory remains at the contract manufacturer at the termination date, the Company is obligated to purchase such inventory which may include raw materials, components and finished goods. The amounts for inventory purchased under termination commitments have been immaterial. In addition to the commitments to purchase products from contract manufacturers described above, the Company may also enter into commitments with other manufacturers to purchase finished goods and components to support innovation and renovation initiatives and/or supply chain initiatives. As of August 31, 2018 , no such commitments were outstanding. Litigation From time to time, the Company is subject to various claims, lawsuits, investigations and proceedings arising in the ordinary course of business, including but not limited to, product liability litigation and other claims and proceedings with respect to intellectual property, breach of contract, labor and employment, tax and other matters. Except as disclosed herein, there are no unasserted claims or pending proceedings for claims against the Company that the Company believes will result in a probable loss for the Company and, as to claims that the Company believes may result in a reasonably possible loss, the Company believes that no reasonably possible outcome of any such claim will have a materially adverse impact on the Company’s financial condition, results of operations or cash flows. On or about July 31, 2018, claims for damages were asserted against the Company in an “Amended Statement of Claim” filed in a civil proceeding in Malaysia before the High Court of Malaya at Shah Alam in the State of Selangor Darul Ehsan, Civil Suit No. BA-22NCvC-531-09/2017 (the “Malay Litigation”). The Malay Litigation was first filed in September 2017 by Sunway Winstar Sdn. Bhd. (“Sunway”) against a former employee of Sunway and the former employee’s new employer, Ekotrends Capital Sdn. Bdh (“Ekotrends”). Sunway was a marketing distributor for the Company for the country of Malaysia from 2004 until 2017. Ekotrends is an affiliate of Bun Seng Hardware Sdn. Bdh. (“Bun Seng”), the Company’s current marketing distributor for Malaysia. The Malay Litigation asserted that the former employee and Ekotrends misappropriated confidential information, including customer lists, associated with Sunway’s terminated relationship as the Company’s exclusive marketing distributor. By order of the court following the Company’s motion to intervene in order to protect and assert its right to ownership of the customer lists and other confidential information associated with the Company’s business in Malaysia, Sunway filed its Amended Statement of Claim to add Bun Seng as a defendant and to assert new and separate claims against the Company alleging conspiracy with Ekotrends and Bun Seng to injure the business and reputation of Sunway . The Company denies the allegations asserted by Sunway and will vigorously defend itself in the Malay Litigation. The Company believes that an unfavorable outcome in the Malay Litigation is not probable, but that an award of damages is reasonably possible. Due to uncertainty as to the theories for recovery of damages asserted by Sunway against the Company and as to results in proceedings under Malaysian law, the Company is unable to estimate the possible loss or range of loss . O n June 11, 2018, the United States Supreme Court denied a petition for a writ of certiorari filed by IQ Products Company on January 10, 2018. IQ Products Company was seeking Supreme Court review of the September 13, 2017 decision of the Fifth Circuit Court of Appeals that affirmed a judgment entered in favor of the Company by the federal district court for the Southern District of Texas on August 25, 2016. The judgment obligated IQ Products Company to pay to the Company the sum of approximately $1.5 million, including post-judgment interest fro m August 25, 2016. The Company received this $1.5 million in July 2018 and recorded the amount as a reduction to its selling, general and administrative expenses in its consolidated financial statements in the fourth quarter of fiscal year 2018. For further information on the risks the Company faces from existing and future claims, suits, investigations and proceedings, see the Company’s risk factors disclosed in Part I―Item 1A, “Risk Factors,” included in this report. Indemnifications As permitted under Delaware law, the Company has agreements whereby it indemnifies senior officers and directors for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company maintains Director and Officer insurance coverage that mitigates the Company’s exposure with respect to such obligations. As a result of the Company’s insurance coverage, management believes that the estimated fair value of these indemnification agreements is minimal. Thus, no liabilities have been recorded for these agreements as of August 31, 2018 . From time to time, the Company enters into indemnification agreements with certain contractual parties in the ordinary course of business, including agreements with lenders, lessors, contract manufacturers, marketing distributors, customers and certain vendors. All such indemnification agreements are entered into in the context of the particular agreements and are provided in an attempt to properly allocate risk of loss in connection with the consummation of the underlying contractual arrangements. Although the maximum amount of future payments that the Company could be required to make under these indemnification agreements is unlimited, management believes that the Company maintains adequate levels of insurance coverage to protect the Company with respect to most potential claims arising from such agreements and that such agreements do not otherwise have value separate and apart from the liabilities incurred in the ordinary course of the Company’s business. Thus, no liabilities have been recorded with respect to such indemnification agreements as of August 31, 2018 . |
Income Taxes
Income Taxes | 12 Months Ended |
Aug. 31, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | Note 12. Income Taxes Income before income taxes consisted of the following (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 United States $ 42,634 $ 42,060 $ 41,128 Foreign (1) 32,544 32,562 31,661 Income before income taxes $ 75,178 $ 74,622 $ 72,789 (1) Included in these amounts are income before income taxes for the EMEA segment of $27.4 million, $28.1 million and $28.3 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. The provision for income taxes consisted of the following (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Current: Federal $ 10,100 $ 10,813 $ 13,269 State 651 744 894 Foreign 6,750 7,465 7,593 Total current 17,501 19,022 21,756 Deferred: United States (7,496) 2,627 (1,100) Foreign (42) 43 (495) Total deferred (7,538) 2,670 (1,595) Provision for income taxes $ 9,963 $ 21,692 $ 20,161 Deferred tax assets and deferred tax liabilities consisted of the following (in thousands): August 31, August 31, 2018 2017 Deferred tax assets: Accrued payroll and related expenses $ 916 $ 1,252 Accounts receivable 303 644 Reserves and accruals 1,496 2,393 Stock-based compensation expense 2,321 3,213 Uniform capitalization 959 1,598 Tax credit carryforwards 2,790 2,309 Other 938 1,289 Total gross deferred tax assets 9,723 12,698 Valuation allowance (2,505) (2,328) Total net deferred tax assets 7,218 10,370 Deferred tax liabilities: Property and equipment, net (1,305) (2,109) Amortization of tax goodwill and intangible assets (16,108) (26,036) Investments in partnerships (222) (679) Other (122) - Total deferred tax liabilities (17,757) (28,824) Net deferred tax liabilities $ (10,539) $ (18,454) The Company had state net operating loss (“NOL”) carryforwards of $3.0 million and $2.6 million as of August 31, 2018 and 2017, respectively, which generated a net deferred tax asset of $0.2 million for each of the fiscal years 2018 and 2017. The state NOL carryforwards, if unused, will expire between fiscal year 2019 and 2038. The Company also had tax credit carryforwards of $ 2.8 million and $2.3 million as of August 31, 2018 and 2017, respectively, of which $2.5 million and $2.1 million, respectively, is attributable to U. K. tax credit carryforwards, which do not expire. Future utilization of the U.K. tax credit carryforwards and certain state NOL carryforwards is uncertain and is dependent upon several factors that may not occur, including the generation of future taxable income in certain jurisdictions. At this time, management cannot conclude that it is “more likely than not” that the related deferred tax assets will be realized. Accordingly, a full valuation allowance has been recorded against the related deferred tax asset associated with the U.K. tax credit carryforwards and certain state NOL carryforwards. A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Amount computed at U.S. statutory federal tax rate $ 19,298 $ 26,118 $ 25,476 State income taxes, net of federal tax benefits 453 327 397 Effect of foreign operations (1,412) (4,277) (4,382) Benefit from qualified domestic production deduction (1,121) (1,295) (1,190) Tax Cuts and Jobs Act: Remeasurement of deferred income taxes (6,762) - - Toll tax, net of foreign tax credits (282) - - Benefit from Stock Compensation (725) - - Other 514 819 (140) Provision for income taxes $ 9,963 $ 21,692 $ 20,161 On December 20, 2017 the United States House of Representatives and the Senate passed the “ Tax Cuts and Jobs Act ” (the “Tax Act”), which was signed into law on December 22, 2017 and became effective beginning January 1, 2018. Due to the complexity of the Tax Act, the SEC issued guidance in SAB 118 which clarifies the accounting for income taxes under ASC 740 if information is not yet available, prepared or analyzed in reasonable detail to complete the accounting for income tax effects of the Tax Act. SAB 118 provides for a measurement period of up to one year after the enactment of the Tax Act, during which time the required analyses and accounting must be completed. During the measurement period, (i) income tax effects of the Tax Act must be reported if the accounting has been completed; (ii) provisional amounts must be reported for income tax effects of the Tax Act for which the accounting is incomplete but a reasonable estimate can be determined; and (iii) provisional amounts are not required to be reported for income tax effects of the Tax Act for which a reasonable estimate cannot be determined. During fiscal year 2018, the Company recorded provisional amounts for the income tax effects of the changes in tax law and tax rates, as reasonable estimates were determined by management during this period. These estimates include the remeasurement of the deferred income tax balance on the Company’s consolidated balance sheets due to the reduction in the corporate federal statutory tax rate from 35% to 21% , as well as the application of a mandatory one-time “toll tax” on unremitted foreign earnings. The combined impact of the remeasurement of deferred income taxes and the measurement of the toll tax, both of which were recorded as provisional amounts and discrete items, resulted in a net favorable impact of $7.1 million to the Company’s provision for income taxes for the fiscal year ended August 31, 2018. The initial remeasurement of the Company’s net deferred income tax liability was recorded during the second quarter of fiscal year 2018 and resulted in a reduction of the net liability of $6.9 million. This provisional benefit was de creased by $0.1 million during the fourth quarter of fiscal year 2018 to reflect year-end deferred balances remeasured at the new applicable statutory tax rates, which resulted in a total provisional benefit of $6.8 million for fiscal year 2018. The Company’s initial provisional estimate of the deemed toll tax, net of foreign tax credits, was recorded as a charge to the provision for income taxes of $6.8 million during the second quarter of fiscal year 2018. As part of its year-end procedures, the Company completed additional analysis that significantly revised management’s estimate of this provisional amount. As a result of this a nalysis, the Company recorded a $7.1 million tax benefit during the fourth quarter of fiscal year 2018 to reflect a total provisional benefit related to the toll tax of $0.3 million for fiscal year 2018. This provisional benefit reflects the Company’s revised analysis, which estimates that foreign tax credits associated with the toll tax are expected to exceed amounts payable under the toll tax. These provisional tax benefits may be reduced or eliminated by future legislation. If such legislation is enacted, the Company will record the impact of the legislation in the quarter of enactment . The determination of the impact of the income tax effects of the items reflected as provisional amounts may change, possibly materially, following additional review of historical records, refinement of calculations, modifications of assumptions, or future legislation, as well as further interpretation of the Tax Act based on U.S. Treasury regulations and guidance from the Internal Revenue Service and state tax authorities. The Company will report revised provisional amounts in accordance with SAB 118 when additional information and guidance has become available . As a result of the Tax Act, the Company has been reevaluating its indefinite reinvestment assertion for its foreign subsidiaries. In May 2018, the Company completed this reevaluation and decided to change its assertion for its U.K., China and Australia subsidiaries such that unremitted earnings for these subsidiaries are no longer considered to be indefinitely reinvested. The Company did not change its assertion for its Canada or Malaysia subsidiaries as a result of its reevaluation and neither previously had an assertion of indefinite reinvestment of unremitted earnings. As a result, the Company no longer considers unremitted foreign earnings of any of its subsidiaries to be indefinitely reinvested. The Company repatriated a portion of its unremitted foreign earnings during the fourth quarter of fiscal year 2018 in the amount of $79.6 million from its U.K. subsidiary and used these funds towards repaying $80.0 million of outstanding draws on its line of credit . The costs associated with repatriating unremitted foreign earnings, including U.S. state income taxes and foreign withholding taxes, are immaterial to the Company’s consolidated financial statements. Management will continue to review the Tax Act and is still in the process of determining the full impacts of the Tax Act on the Company. Management expects that the Company will lose the benefit from the Qualified Production Deduction in fiscal year 2019 but also expects to acquire certain benefits from the Foreign Derived Intangible Income section of the Tax Act. Other significant sections of the new tax law, including the Global Intangible Low-Taxed Income (“GILTI”) and the Base Erosion Anti-Abuse Tax (“BEAT”), do not apply to the Company’s fiscal year 2018. The Company will continue to evaluate the GILTI and the BEAT to determine whether they will have any significant impact on the Company’s consolidated financial statements in future years. The provision for income taxes was 13.3% and 29.1% of income before income taxes for the fiscal years ended August 31, 2018 and 2017, respectively. The decrease in the effective income tax rate from period to period was primarily due to the favorable impacts of the reduced tax rate resulting from the Tax Act, which became effective during the second quarter of the Company’s fiscal year. Since the Company has a fiscal year which ends on August 31 st , the Company is subject to a “blended” corporate federal statutory rate in its fiscal year 2018 which is calculated based on the applicable tax rates before and after passage of the Tax Act and the number of days in the fiscal year. As a result of this calculation, the Company’s blended federal statutory tax rate for fiscal year 2018 is 25.7% which is more than 9 percentage points lower than the statutory rate of 35% in the prior fiscal year. The Company also recorded two discrete items related to the Tax Act during fiscal year 2018, the $6. 8 million provisional remeasurement of the Company’s net deferred tax liability and the $ 0.3 million provisional benefit related to the toll tax, both of which lowered the Company’s effective income tax rate from period to period. The decrease in the effective income tax rate from period to period was also driven in part by the adoption of ASU 2016-09, “ Improvements to Employee Share-Based Payment Accounting ”, in the first quarter of the Company’s fiscal year 2018 which resulted in excess tax benefits from settlements of stock-based equity awards of $0.7 million being recognized in the provision for income taxes, whereas such benefits were recognized as an increase to additional paid-in capital in prior periods. In addition, the effective income tax rate for the fiscal year ended August 31, 2017 was higher due to the unfavorable impact of a non-recurring immaterial out-of-period correction that the Company recorded in the second quarter of fiscal year 2017 associated with the tax impacts from certain unrealized foreign currency exchange losses. Reconciliations of the beginning and ending amounts of the Company’s gross unrecognized tax benefits, excluding interest and penalties, are as follows (in thousands): Fiscal Year Ended August 31, 2018 2017 Unrecognized tax benefits - beginning of fiscal year $ 981 $ 1,239 Net increases (decreases) - prior period tax positions 62 (68) Net increases - current period tax positions 263 228 Expirations of statute of limitations for assessment (197) (382) Settlements (71) (36) Unrecognized tax benefits - end of fiscal year $ 1,038 $ 981 Gross unrecognized tax benefits totaled $1.0 million for each of the fiscal years ended August 31, 2018 and 2017, of which $0.9 million and $0.6 million, respectively, would affect the Company’s effective income tax rate if recognized. There were no material interest or penalties included in income tax expense for the fiscal years ended August 31, 2018 and 2017. The total balance of accrued interest and penalties related to uncertain tax positions was also immaterial at August 31, 2018 and 2017. The Company is subject to taxation in the U.S. and in various state and foreign jurisdictions. Due to expired statutes and closed audits, the Company’s federal income tax returns for years prior to fiscal year 2016 are not subject to examination by the U.S. Internal Revenue Service . Generally, for the majority of state and foreign jurisdictions where the Company does business, periods prior to fiscal year 2014 are no longer subject to examination. The Company has estimated that up to $0.2 million of unrecognized tax benefits related to income tax positions may be affected by the resolution of tax examinations or expiring statutes of limitation within the next twelve months. Audit outcomes and the timing of settlements are subject to significant uncertainty. |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Aug. 31, 2018 | |
Stock-based Compensation [Abstract] | |
Stock-based Compensation | Note 13. Stock-based Compensation As of August 31, 2018, the Company had one stock incentive plan, the WD-40 Company 2016 Stock Incentive Plan (“2016 Plan”), which was approved by the Company’s shareholders effective as of December 13, 2016. The 2016 Plan permits the granting of various stock-based equity awards, including non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units and other stock-based awards to employees, directors and consultants. To date through August 31, 2018, the Company had granted awards of restricted stock units (“RSUs”), market share units (“MSUs”) and deferred performance units (“DPUs”) under the 2016 Plan. Additionally, as of August 31, 2018, there were still outstanding RSUs, MSUs and DPUs which had been granted under the Company’s prior equity incentive plan. The 2016 Plan is administered by the Board of Directors (the “Board”) or the Compensation Committee or other designated committee of the Board (the “Committee”). All stock-based equity awards granted under the 2016 Plan are subject to the specific terms and conditions as determined by the Committee at the time of grant of such awards in accordance with the various terms and conditions specified for each award type per the 2016 Plan. The total number of shares of common stock authorized for issuance pursuant to grants of awards under the 2016 Plan is 1,000,000 . As of August 31, 2018, 786,364 shares of common stock remained available for future issuance pursuant to grants of awards under the 2016 Plan. The shares of common stock to be issued pursuant to awards under the 2016 Plan may be authorized shares not previously issued, or treasury shares. The Company has historically issued new authorized shares not previously issued upon the settlement of the various stock-based equity awards under its equity incentive plans. Vesting of the RSUs granted to directors is immediate, with shares to be issued pursuant to the vested RSUs upon termination of each director’s service as a director of the Company. Vesting of the one-time grant of RSUs granted to certain key executives of the Company in March 2008 in settlement of these key executives’ benefits under the Company’s supplemental employee retirement plan agreements was over a period of three years from the date of grant, with shares to be issued pursuant to the vested RSUs six months following the day after each executive officer’s termination of employment with the Company. Vesting of the RSUs granted to certain high level employees is over a period of three years from the date of grant, subject to potential earlier vesting in the event of retirement of the holder of the award in accordance with the award agreement, with shares to be issued pursuant to the vested RSUs at the time of vest. The director RSU holders and the executive officer March 2008 grant date RSU holders are entitled to receive dividend equivalents with respect to their RSUs, payable in cash as and when dividends are declared by the Company’s Board of Directors. Vesting of the MSUs granted to certain high level employees follows a performance measurement period of three fiscal years commencing with the Company’s fiscal year in which the MSU awards are granted (the “Measurement Period”). Shares will be issued pursuant to the vested MSUs following the conclusion of the applicable MSU Measurement Period after the Committee’s certification of achievement of the applicable performance measure for such awards and the vesting of the MSU awards and the applicable percentage of the target number of MSU shares to be issued. The recipient must remain employed with the Company for vesting purposes until the date on which the Committee certifies achievement of the applicable performance measure for the MSU awards, subject to potential pro-rata vesting in the event of earlier retirement of the holder of the award in accordance with the award agreement. Vesting of the DPUs granted to certain high level employees follows a performance measurement period of one fiscal year that is the same fiscal year in which the DPU awards are granted (the “Measurement Year”). A number of DPUs equal to the applicable percentage of the maximum number of DPUs awarded will be confirmed as vested following the conclusion of the applicable DPU Measurement Year after the Committee’s certification of achievement of the applicable performance measure for such awards (the “Vested DPUs”). The recipient must remain employed with the Company for vesting purposes until August 31 of the Measurement Year, subject to potential pro-rata vesting in the event of earlier retirement of the holder of the award in accordance with the award agreement. For recipients who are residents of the United States, the Vested DPUs must be held until termination of employment, with shares to be issued pursuant to the Vested DPUs six months following the day after each such recipient’s termination of employment with the Company. For recipients who are not residents of the United States, the Committee has discretion to either defer settlement of each such recipient’s Vested DPUs by issuance of shares following termination of employment or settle each Vested DPU in cash by payment of an amount equal to the closing price of one share of the Company’s common stock as of the date of the Committee’s certification of the relative achievement of the applicable performance measure for the DPU awards. Until issuance of shares in settlement of the Vested DPUs, the holders of each Vested DPU that is not settled in cash are entitled to receive dividend equivalents with respect to their Vested DPUs, payable in cash as and when dividends are declared by the Company’s Board of Directors. Stock-based compensation expense is amortized on a straight-line basis over the requisite service period for the entire award. Stock-based compensation expense related to the Company’s stock-based equity awards totaled $ 4.2 million, $4.1 million and $ 3.7 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. The Company recognized income tax benefits related to such stock-based compensation of $1.1 million, $1.4 million and $1.2 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. As of August 31, 2018, the total unamortized compensation cost related to non-vested stock-based equity awards was $0.6 million and $1.7 million for RSUs and MSUs, respectively, which the Company expects to recognize over remaining weighted-average vesting periods of 1.6 and 1.8 years for RSUs and MSUs, respectively. No unamortized compensation cost for DPUs remained as of August 31, 2018. Stock Options Fiscal year 2008 was the last fiscal period in which the Company granted stock options. The estimated fair value of each of the Company’s stock option awards granted in and prior to fiscal year 2008 was determined on the date of grant using the Black-Scholes option pricing model. A summary of the Company’s stock option award activity is as follows (in thousands, except share and per share amounts and contractual term in years data): Weighted-Average Remaining Weighted-Average Contractual Term Number of Exercise Price Per Share Aggregate Stock Options Shares Per Share (in years) Intrinsic Value Outstanding at August 31, 2017 5,960 $ 36.03 Granted - $ - Exercised (5,960) $ 36.03 Forfeited or expired - $ - Outstanding at August 31, 2018 - $ - - $ - Exercisable at August 31, 2018 - $ - - $ - The total intrinsic value of stock options exercised was $0.5 million, $1.6 million and $2.5 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. The income tax benefits from stock options exercised totaled $0.1 million, $0.4 million and $0.7 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. Restricted Stock Units The estimated fair value of each of the Company’s RSU awards was determined on the date of grant based on the closing market price of the Company’s common stock on the date of grant for those RSUs which are entitled to receive dividend equivalents with respect to the RSUs, or based on the closing market price of the Company’s common stock on the date of grant less the grant date present value of expected dividends during the vesting period for those RSUs which are not entitled to receive dividend equivalents with respect to the RSUs. A summary of the Company’s restricted stock unit activity is as follows (in thousands, except share and per share amounts): Weighted-Average Grant Date Number of Fair Value Aggregate Restricted Stock Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 116,770 $ 63.61 Granted 24,114 $ 111.71 Converted to common shares (24,471) $ 76.58 Forfeited (1,105) $ 104.24 Outstanding at August 31, 2018 115,308 $ 70.52 $ 20,461 Vested at August 31, 2018 87,309 $ 59.22 $ 15,493 The weighted-average grant date fair value of all RSUs granted during the fiscal years ended August 31, 2018, 2017 and 2016 was $111.71 , $ 109.23 and $95.89 , respectively. The total intrinsic value of all RSUs converted to common shares was $2.8 million, $3.6 million and $2.8 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. The income tax benefits from RSUs converted to common shares totaled $0.7 million, $1.3 million and $1.0 million for the fiscal years ended August 31, 2018, 2017 and 2016 , respectively. Market Share Units The MSUs are market performance-based awards that shall vest with respect to the applicable percentage of the target number of MSU shares based on relative total stockholder return (“TSR”) for the Company as compared to the total return for the Russell 2000 Index (“Index”) over the performance Measurement Period. The ultimate number of MSUs that vest may range from 0% to 200% of the original target number of shares depending on the relative achievement of the TSR performance measure at the end of the Measurement Period. The probabilities of the actual number of MSUs expected to vest and resultant actual number of shares of common stock expected to be awarded are reflected in the grant date fair values of the various MSU awards; therefore, the compensation expense for the MSU awards will be recognized assuming the requisite service period is rendered and will not be adjusted based on the actual number of such MSU awards to ultimately vest. The estimated fair value of each of the Company’s MSU awards, which are not entitled to receive dividend equivalents with respect to the MSUs, was determined on the date of grant using the Monte Carlo simulation model, which utilizes multiple input variables to simulate a range of possible future stock prices for both the Company and the Index and estimates the probabilities of the potential payouts. The determination of the estimated grant date fair value of the MSUs is affected by the Company’s stock price and a number of assumptions including the expected volatilities of the Company’s stock and the Index, the Company’s risk-free interest rate and expected dividends. The following weighted-average assumptions for MSU grants for the last three fiscal years were used in the Monte Carlo simulation model: Fiscal Year Ended August 31, 2018 2017 2016 Expected volatility 20.4% 21.1% 22.2% Risk-free interest rate 1.6% 1.0% 0.9% Expected dividend yield 0.0% 0.0% 0.0% The expected volatility utilized was based on the historical volatilities of the Company’s common stock and the Index in order to model the stock price movements. The volatility used was calculated over the most recent 2.89 -year periods for MSUs granted during each of the fiscal years ended August 31, 2018, 2017 and 2016, which were the remaining terms of the performance Measurement Period at the dates of grant. The risk-free interest rates used were based on the implied yield available on a U.S. Treasury zero-coupon bill with a remaining term equivalent to the remaining performance Measurement Period. The MSU awards stipulate that, for purposes of computing the relative TSR for the Company as compared to the return for the Index, dividends paid with respect to both the Company’s stock and the Index are to be treated as being reinvested into the stock of each entity as of the ex-dividend date. Accordingly, an expected dividend yield of zero was used in the Monte Carlo simulation model, which is the mathematical equivalent to reinvesting dividends in the issuing entity over the performance Measurement Period. A summary of the Company’s market share unit activity is as follows (in thousands, except share and per share amounts) : Weighted-Average Grant Date Number of Fair Value Aggregate Market Share Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 44,919 $ 94.95 Granted 15,729 $ 101.93 Performance factor adjustments 12,194 $ 76.04 Converted to common shares (27,589) $ 74.30 Forfeited (3,045) $ 91.87 Outstanding at August 31, 2018 (1) 42,208 $ 105.81 $ 7,490 (1) This figure represents the total number of shares underlying MSU grants assuming achievement of the target number of shares at 100%. As the ultimate number of shares that vest could be as high as 200% of the target, the Company may be required to issue additional shares to satisfy outstanding MSU award grants. The weighted-average grant date fair value of all MSUs granted during the fiscal years ended August 31, 2018, 2017 and 2016 was $101.93 , $90.91 and $120.99 , respectively. The total intrinsic value of all MSUs converted to common shares was $3.0 million, 2.8 million and $3.7 million for the fiscal years ended August 31, 2018 , 2017 and 2016, respectively. The income tax benefits from MSUs converted to common shares totaled $0.8 million, $0.9 million and $1.2 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. Deferred Performance Units The DPU awards provide for performance-based vesting over a performance measurement period of the fiscal year in which the DPU awards are granted. The performance vesting provisions of the DPUs are based on relative achievement within an established performance measure range of the Company’s reported earnings before interest, income taxes, depreciation in operating departments, and amortization computed on a consolidated basis for the Measurement Year, before deduction of the stock-based compensation expense for the Vested DPUs and excluding other non-operating income and expense amounts (“Adjusted Global EBITDA”). The ultimate number of DPUs that vest may range from 0% to 100% of the original maximum number of DPUs awarded depending on the relative achievement of the Adjusted Global EBITDA performance measure at the end of the Measurement Year. The estimated fair value of each of the Company’s DPU awards was determined on the date of grant based on the closing market price of the Company’s common stock on the date of grant less the grant date present value of expected dividends during the vesting period for the DPUs, which are not entitled to receive dividend equivalents with respect to the unvested DPUs. A summary of the Company’s deferred performance unit activity is as follows (in thousands, except share and per share amounts): Weighted-Average Grant Date Number of Fair Value Aggregate Deferred Performance Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 30,876 $ 107.66 Granted 26,906 $ 110.65 Performance factor adjustments (25,882) $ 110.19 Converted to common shares (192) $ 94.54 Forfeited (940) $ 110.65 Outstanding at August 31, 2018 30,768 $ 108.14 $ 5,460 Vested at August 31, 2018 4,802 $ 94.54 $ 852 The weighted-average grant date fair value of all DPUs granted during the fiscal years ended August 31, 2018, 2017 and 2016 was $110.65 , $110.19 and $94.54 , respectively. The total intrinsic value of all DPUs converted to common shares was not significant for each of the fiscal years ended August 31, 2018 and 2017, and no DPUs were converted to common shares during the fiscal year ended August 31, 2016. The income tax benefits from DPUs converted to common shares were not significant for each of the fiscal years ended August 31, 2018 and 2017. |
Other Benefit Plans
Other Benefit Plans | 12 Months Ended |
Aug. 31, 2018 | |
Other Benefit Plans [Abstract] | |
Other Benefit Plans | Note 14. Other Benefit Plans The Company has a WD-40 Company Profit Sharing/401(k) Plan and Trust (the “Profit Sharing/401(k) Plan”) whereby regular U.S. employees who have completed certain minimum service requirements can defer a portion of their income through contributions to a trust. The Profit Sharing/401(k) Plan provides for Company contributions to the trust, as approved by the Board of Directors, as follows: 1) matching contributions to each participant up to 50% of the first 6.6% of compensation contributed by the participant; 2) fixed non-elective contributions in the amount equal to 10% of eligible compensation; and 3) a discretionary non-elective contribution in an amount to be determined by the Board of Directors up to 5% of eligible compensation. The Company’s contributions are subject to overall employer contribution limits and may not exceed the amount deductible for income tax purposes. The Profit Sharing/401(k) Plan may be amended or discontinued at any time by the Company. The Company’s contribution expense for the Profit Sharing/401(k) Plan was $3.3 million for each of the fiscal years 2018 and 2017, respectively, and $3.2 million for fiscal years 2016. The Company’s international subsidiaries have similar benefit plan arrangements, dependent upon the local applicable laws and regulations. The plans provide for Company contributions to an appropriate third-party plan , as approved by the subsidiary’s Board of Directors. The Company’s contribution expense related to the international plans was $1.6 million, $1.4 million and $1.5 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. |
Business Segments And Foreign O
Business Segments And Foreign Operations | 12 Months Ended |
Aug. 31, 2018 | |
Business Segments And Foreign Operations [Abstract] | |
Business Segments And Foreign Operations | Note 15. Business Segments and Foreign Operations The Company evaluates the performance of its segments and allocates resources to them based on sales and operating income. The Company is organized on the basis of geographical area into the following three segments: the Americas; EMEA; and Asia-Pacific. Segment data does not include inter-segment revenues. Unallocated corporate expenses are general corporate overhead expenses not directly attributable to the operating segments and are reported separate from the Company’s identified segments. The corporate overhead costs include expenses for the Company’s accounting and finance, information technology, human resources, research and development, quality control and executive management functions, as well as all direct costs associated with public company compliance matters including legal, audit and other professional services costs. Also included in corporate overhead costs for fiscal year 2018 are corporate funded advertising and sales promotion expenses focused on increasing the Company’s digital presence and building brand awareness. Unallocated Americas EMEA Asia-Pacific Corporate (1) Total Fiscal Year Ended August 31, 2018 Net sales $ 192,878 $ 150,878 $ 64,762 $ - $ 408,518 Income from operations $ 48,954 $ 36,241 $ 19,098 $ (25,689) $ 78,604 Depreciation and amortization expense $ 4,142 $ 2,561 $ 313 $ 784 $ 7,800 Interest income $ 13 $ 320 $ 121 $ - $ 454 Interest expense $ 4,209 $ - $ 10 $ - $ 4,219 Fiscal Year Ended August 31, 2017 Net sales $ 184,929 $ 136,771 $ 58,806 $ - $ 380,506 Income from operations $ 48,303 $ 35,389 $ 16,765 $ (24,548) $ 75,909 Depreciation and amortization expense $ 4,270 $ 2,090 $ 254 $ 155 $ 6,769 Interest income $ 8 $ 389 $ 111 $ - $ 508 Interest expense $ 2,570 $ - $ 12 $ - $ 2,582 Fiscal Year Ended August 31, 2016 Net sales $ 191,397 $ 135,235 $ 54,038 $ - $ 380,670 Income from operations $ 48,404 $ 31,702 $ 15,162 $ (23,920) $ 71,348 Depreciation and amortization expense $ 4,071 $ 2,084 $ 280 $ 30 $ 6,465 Interest income $ 5 $ 485 $ 193 $ - $ 683 Interest expense $ 1,689 $ - $ 14 $ - $ 1,703 (1) Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the operating segments. These expenses are reported separate from the Company’s identified segments and are included in Selling, General and Administrative expenses on the Company’s consolidated statements of operations. The Company’s Chief Operating Decision Maker does not review assets by segment as part of the financial information provided and therefore, no asset information is provided in the above table. Net sales by product group are as follows (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Maintenance products $ 372,391 $ 342,295 $ 339,974 Homecare and cleaning products 36,127 38,211 40,696 Total $ 408,518 $ 380,506 $ 380,670 Net sales and long-lived assets by geographic area are as follows (in thousands): Fiscal Year Ended August 31, 2018 2017 2016 Net Sales by Geography: United States $ 154,986 $ 150,086 $ 158,139 International 253,532 230,420 222,531 Total $ 408,518 $ 380,506 $ 380,670 Long-lived Assets by Geography (2) : United States $ 21,986 $ 23,346 $ 6,419 International 14,371 6,093 5,126 Total $ 36,357 $ 29,439 $ 11,545 (2) Includes tangible assets and property and equipment, net, attributed to the geographic location in which such assets are located. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Aug. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16. Subsequent Events On October 9, 201 8 , the Company’s Board of Directors declared a cash dividend of $0.54 per share payable on October 31, 201 8 to shareholders of record on October 19, 201 8 . |
Basis Of Presentation And Sum_2
Basis Of Presentation And Summary Of Significant Accounting Policies (Policy) | 12 Months Ended |
Aug. 31, 2018 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |
Basis Of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use Of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Supplier Risk | Supplier Risk The Company relies on a limited number of suppliers, including single or sole source suppliers for certain of its raw materials, packaging, product components and other necessary supplies. Where possible and where it makes business sense, the Company works with secondary or multiple suppliers to qualify additional supply sources. To date, the Company has been able to obtain adequate supplies of these materials which are used in the production of its maintenance products and homecare and cleaning products in a timely manner from existing sources. |
Cash And Cash Equivalents | Cash and Cash Equivalents Cash equivalents are highly liquid investments purchased with an original maturity of three months or less. |
Short-term Investments | Short-term Investments The Company's short-term investments consist of term deposits and callable time deposits. These short-term investments had a carrying value of $0.2 million and $ 80.2 million at August 31, 2018 and 2017, respectively. The decrease in short-term investments during fiscal year 2018 was due to the maturity of the Company’s callable time deposits held by its U.K. subsidiary. These deposits matured in April 2018 and were not reinvested. As of August 31, 2018, the Company’s short-term investment balance consisted of term deposits that are subject to penalty for early redemption before their maturity. |
Trade Accounts Receivable And Allowance For Doubtful Accounts | Trade Accounts Receivable and Allowance for Doubtful Accounts Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in existing accounts receivable. The Company determines the allowance for doubtful accounts based on historical write-off experience and the identification of specific balances deemed uncollectible. Trade accounts receivable are charged against the allowance when the Company believes it is probable that the trade accounts receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Allowance for doubtful accounts related to the Company’s trade accounts receivable were not significant at August 31, 2018 and 2017. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. C ost is determined based on a first-in, first-out method or, for a portion of raw materials inventory, the average cost method. When necessary, the Company adjusts the carrying value of its inventory to the lower of cost or net realizable value , including any costs to sell or dispose of such inventory. Appropriate consideration is given by the Company to obsolescence, excessive inventory levels, product deterioration and other factors when evaluating net realizable value for the purposes of determining the lower of cost or net realizable value . Included in inventories are amounts for certain raw materials and components that the Company has provided to its third-party contract manufacturers but that remain unpaid to the Company as of the balance sheet date. The Company’s contract manufacturers package products to the Company’s specifications and, upon order from the Company, ship ready-to-sell inventory to either the Company’s third-party distribution centers or directly to its customers. The Company transfers certain raw materials and components to these contract manufacturers for use in the manufacturing process. Contract manufacturers are obligated to pay the Company for these raw materials and components upon receipt. Amounts receivable from the contract manufacturers as of the balance sheet date related to transfers of these raw materials and components by the Company to its contract manufacturers are considered product held at third-party contract manufacturers and are included in inventories in the accompanying consolidated balance sheets. |
Property And Equipment | Property and Equipment Property and equipment is stated at cost. Depreciation is computed using the straight-line method based upon estimated useful lives of ten to forty years for buildings and improvements, three to fifteen years for machinery and equipment, three to five years for vehicles, three to ten years for furniture and fixtures and three to five years for software and computer equipment. Depreciation expense totaled $4.8 million, $3.9 million and $3. 5 million for fiscal years 2018, 2017 and 2016, respectively. These amounts include factory depreciation expense which is recognized as cost of products sold and totaled $1.1 million for each of the fiscal years 2018 and 2017, respectively, and $0.8 million for fiscal year 2016. |
Software | Software The Company capitalizes costs related to computer software obtained or developed for internal use. Software obtained for internal use has generally been enterprise-level business and finance software that the Company customizes to meet its specific operational needs. Costs incurred in the application development phase are capitalized and amortized over their useful lives, which are generally three to five years. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of tangible and intangible assets acquired. The carrying value of goodwill is reviewed for possible impairment in accordance with the authoritative guidance on goodwill, intangibles and other. The Company assesses possible impairments to goodwill at least annually during its second fiscal quarter and otherwise when events or changes in circumstances indicate that an impairment condition may exist. In performing the annual impairment test of its goodwill, the Company considers the fair value concepts of a market participant and the highest and best use for its intangible assets. In addition to the annual impairment test, goodwill is evaluated each reporting period to determine whether events and circumstances would more likely than not reduce the fair value of a reporting unit below its carrying value. When testing goodwill for impairment, the Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative goodwill impairment test. If, after assessing qualitative factors, the Company determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing a quantitative test is unnecessary. Otherwise, a quantitative test is performed to identify the potential impairment and to measure the amount of goodwill impairment, if any. Any required impairment losses are recorded as a reduction in the carrying amount of the related asset and charged to results of operations. No goodwill impairments were identified by the Company during fiscal years 2018, 2017 and 2016. |
Long-lived Assets | Long-lived Assets The Company’s long-lived assets consist of property and equipment and definite-lived intangible assets. Long-lived assets are depreciated or amortized, as applicable, on a straight-line basis over their estimated useful lives. The Company assesses potential impairments to its long-lived assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable and/or its remaining useful life may no longer be appropriate. Any required impairment loss would be measured as the amount by which the asset’s carrying amount exceeds its fair value, which is the amount at which the asset could be bought or sold in a current transaction between willing market participants and would be recorded as a reduction in the carrying amount of the related asset and a charge to results of operations. An impairment loss would be recognized when the sum of the expected future undiscounted net cash flows is less than the carrying amount of the asset. No impairments to its long-lived assets were identified by the Company during fiscal years 2018, 2017 and 2016. |
Fair Value Of Financial Instruments | Fair Value of Financial Instruments Accounting Standards Codification (“ASC”) 820, “ Fair Value Measurements and Disclosures” , defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company categorizes its financial assets and liabilities measured at fair value into a hierarchy that categorizes fair value measurements into the following three levels based on the types of inputs used in measuring their fair value: Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities; Level 2: Observable market-based inputs or observable inputs that are corroborated by market data; and Level 3: Unobservable inputs reflecting the Company’s own assumptions. Under fair value accounting, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. As of August 31, 2018, the Company had no assets or liabilities that are measured at fair value in the financial statements on a recurring basis, with the exception of the foreign currency forward contracts, which are classified as Level 2 within the fair value hierarchy. The carrying values of cash equivalents, short-term investments and short-term borrowings are recorded at cost, which approximates their fair values primarily due to their short-term maturities and are classified as Level 2 within the fair value hierarchy. In addition, the carrying value of borrowings held under the Company’s revolving credit facility approximates fair value due to the variable nature of underlying interest rates, which generally reflect market conditions and such borrowings are classified as Level 2 within the fair value hierarchy. The Company’s fixed rate long-term borrowings consist of senior notes which are also classified as Level 2 within the fair value hierarchy and are recorded at carrying value. The Company estimates that the fair value of its senior notes was approximately $18.8 million as of August 31, 2018, which was determined based on a discounted cash flow analysis using current market interest rates for instruments with similar terms, compared to its carrying value of $19.6 million. During the fiscal years ended August 31, 2018, 2017 and 2016, the Company did not record any significant nonrecurring fair value measurements for assets or liabilities in periods subsequent to their initial recognition. |
Concentration Of Credit Risk | Concentration of Credit Risk Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist principally of cash and cash equivalents, short-term investments and trade accounts receivable. The Company’s policy is to place its cash in high credit quality financial institutions, in investments that include demand deposits, term deposits and callable time deposits. The Company’s trade accounts receivable are derived from customers located in North America, South America, Asia-Pacific, Europe, the Middle East, Africa and India. The Company limits its credit exposure from trade accounts receivable by performing on-going credit evaluations of customers, as well as insuring its trade accounts receivable in selected markets. |
Insurance Coverage | Insurance Coverage The Company carries insurance policies to cover insurable risks such as property damage, business interruption, product liability, workers’ compensation and other risks, with coverage and other terms that it believes to be adequate and appropriate. These policies may be subject to applicable deductible or retention amounts, coverage limitations and exclusions. The Company does not maintain self-insurance with respect to its material risks; therefore, the Company has not provided for self-insurance reserves as of August 31, 2018 and 2017. |
Revenue Recognition And Sales Incentives | Revenue Recognition and Sales Incentives Sales are recognized as revenue at the time of delivery to the customer when risks of loss and title have passed. Sales are recorded net of allowances for damaged goods and other sales returns, sales incentives, trade promotions and cash discounts. The Company records the costs of promotional activities such as sales incentives, trade promotions, coupon offers and cash discounts that are given to its customers as a reduction of sales in its consolidated statements of operations. The Company offers on-going trade promotion programs with customers and consumer coupon programs that require the Company to estimate and accrue the expected costs for such programs. Programs include cooperative marketing programs, shelf price reductions, coupons, rebates, consideration and allowances given to retailers for shelf space and/or favorable display positions in their stores and other promotional activities. Costs related to rebates, cooperative advertising and other promotional activities are recorded as a reduction to sales upon delivery of the Company’s products to its customers. Coupon costs are based upon historical redemption rates and are recorded as a reduction to sales as incurred, which is when the coupons are circulated. |
Cost Of Products Sold | Cost of Products Sold Cost of products sold primarily includes the cost of products manufactured on the Company’s behalf by its third-party contract manufacturers, net of volume and other rebates. Cost of products sold also includes the costs to manufacture WD-40 concentrate, which is done at the Company’s own facilities or at third-party contract manufacturers. When the concentrate is manufactured by the Company, cost of products sold includes direct labor, direct materials and supplies; in-bound freight costs related to purchased raw materials and finished product; and depreciation of machinery and equipment used in the manufacturing process. |
Selling, General And Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses include costs related to selling the Company’s products, such as the cost of the sales force and related sales and broker commissions; shipping and handling costs paid to third-party companies to distribute finished goods from the Company’s third-party contract manufacturers and distribution centers to its customers; other general and administrative costs related to the Company’s business such as general overhead, legal and accounting fees, insurance, and depreciation; and other employee-related costs to support marketing, human resources, finance, supply chain, information technology and research and development activities. |
Shipping And Handling Costs | Shipping and Handling Costs Shipping and handling costs associated with in-bound freight and movement of product from third-party contract manufacturers to the Company’s third-party warehouses are capitalized in the cost of inventory and subsequently included in cost of sales when recognized in the statement of operations. Shipping and handling costs associated with out-bound transportation are included in selling, general and administrative expenses and are recorded at the time of shipment of product to the Company’s customers. Out-bound shipping and handling costs were $17.7 million, $16.4 million and $16.1 million for fiscal years 2018, 2017 and 2016, respectively. |
Advertising And Sales Promotion Expenses | Advertising and Sales Promotion Expenses Advertising and sales promotion expenses are expensed as incurred. Advertising and sales promotion expenses include costs associated with promotional activities that the Company pays to third parties, which include costs for advertising (television, print media and internet), administration of coupon programs, consumer promotions, product demonstrations, public relations, agency costs, package design expenses and market research costs. Total advertising and sales promotion expenses were $22.3 million, $20.5 million and $22.3 million for fiscal years 2018, 2017 and 2016, respectively. |
Research And Development | Research and Development The Company is involved in research and development efforts that include the ongoing development or innovation of new products and the improvement, extension or renovation of existing products or product lines. All research and development costs are expensed as incurred and are included in selling, general and administrative expenses. Research and development expenses were $7.0 million, $8.4 million and $7.7 million in fiscal years 2018, 2017 and 2016, respectively. These expenses include costs associated with general research and development activities, as well as those associated with internal staff, overhead, design testing, market research and consultants. |
Income Taxes | Income Taxes Current income tax expense is the amount of income taxes expected to be payable for the current year. A deferred income tax liability or asset is established for the expected future tax consequences resulting from the differences in financial reporting and tax bases of assets and liabilities. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. In addition to valuation allowances, the Company provides for uncertain tax positions when such tax positions do not meet the recognition thresholds or measurement standards prescribed by the authoritative guidance on income taxes. Amounts for uncertain tax positions are adjusted in periods when new information becomes available or when positions are effectively settled. The Company recognizes accrued interest and penalties related to uncertain tax positions as a component of income tax expense. As a result of the “Tax Cuts and Jobs Act” (the “Tax Act”) which became effective beginning January 1, 2018, the U.S. has transitioned from a worldwide tax system to a modified territorial tax system, under which corporations are primarily taxed on income earned within the country’s borders, rather than on a worldwide basis. The Company is still required to make assertions on whether its foreign subsidiaries will invest their undistributed earnings indefinitely and these assertions are based on the capital needs of the foreign subsidiaries. Due to the passage of the Tax Act, the Company began reevaluating the indefinite reinvestment assertion for its foreign subsidiaries. In May 2018, the Company completed this reevaluation and changed its indefinite reinvestment assertion for certain of its foreign subsidiaries. As a result, the Company no longer considers unremitted earnings of any of its foreign subsidiaries to be indefinitely reinvested. For additional information on the Tax Act, see Note 12 — Income Taxes, included in this report. |
Foreign Currency | Foreign Currency The Company translates the assets and liabilities of its foreign subsidiaries into U.S. dollars at current rates of exchange in effect at the end of the reporting period. Income and expense items are translated at rates that approximate the rates in effect at the transaction date. Gains and losses from translation are included in accumulated other comprehensive income or loss. Gains or losses resulting from foreign currency transactions (transactions denominated in a currency other than the entity’s functional currency) are included as other income in the Company’s consolidated statements of operations. The Company had $0.1 million, $0.4 million and $2 .4 million of net gains in foreign currency transactions in fiscal years 2018, 2017 and 2016, respectively. In the normal course of business, the Company employs established policies and procedures to manage its exposure to fluctuations in foreign currency exchange rates. The Company’s U.K. subsidiary, whose functional currency is Pound Sterling, utilizes foreign currency forward contracts to limit its exposure to net asset balances held in non-functional currencies, specifically the Euro. The Company regularly monitors its foreign currency exchange rate exposures to ensure the overall effectiveness of its foreign currency hedge positions. While the Company engages in foreign currency hedging activity to reduce its risk, for accounting purposes, none of its foreign currency forward contracts are designated as hedges. Foreign currency forward contracts are carried at fair value, with net realized and unrealized gains and losses recognized currently in other income (expense) in the Company’s consolidated statements of operations. Cash flows from settlements of foreign currency forward contracts are included in operating activities in the consolidated statements of cash flows. Foreign currency forward contracts in an asset position at the end of the reporting period are included in other current assets, while foreign currency forward contracts in a liability position at the end of the reporting period are included in accrued liabilities in the Company’s consolidated balance sheets. At August 31, 2018, the Company had a notional amount of $ 23 .1 million outstanding in foreign currency forward contracts, which matured in September 2018 . Unrealized net gains related to foreign currency forward contracts were not significant at August 31, 2018, while unrealized net losses were $0.6 million at August 31, 2017. Realized net losses related to foreign currency forward contracts were not significant for the fiscal year ended August 31, 2018, while realized net losses were $0.5 million for the fiscal year ended August 31, 2017. Both unrealized and realized net gains and losses are recorded in other income on the Company’s consolidated statements of operations. |
Earnings Per Common Share | Earnings per Common Share Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents, whether paid or unpaid, are participating securities that are required to be included in the computation of earnings per common share pursuant to the two-class method. Accordingly, the Company’s outstanding unvested, if any, and outstanding vested stock-based equity awards that provide such nonforfeitable rights to dividend equivalents are included as participating securities in the calculation of earnings per common share (“EPS”) pursuant to the two-class method. The Company calculates EPS using the two-class method, which provides for an allocation of net income between common stock and other participating securities based on their respective participation rights to share in dividends. Basic EPS is calculated by dividing net income available to common shareholders for the period by the weighted-average number of common shares outstanding during the period. Net income available to common shareholders for the period includes dividends paid to common shareholders during the period plus a proportionate share of undistributed net income allocable to common shareholders for the period; the proportionate share of undistributed net income allocable to common shareholders for the period is based on the proportionate share of total weighted-average common shares and participating securities outstanding during the period. Diluted EPS is calculated by dividing net income available to common shareholders for the period by the weighted-average number of common shares outstanding during the period increased by the weighted-average number of potentially dilutive common shares (dilutive securities) that were outstanding during the period if the effect is dilutive. Dilutive securities are comprised of various types of stock-based equity awards granted under the Company’s prior and current equity incentive plans. |
Stock-based Compensation | Stock-based Compensation The Company accounts for stock-based equity awards exchanged for employee and non-employee director services in accordance with the authoritative guidance for share-based payments. Stock-based equity awards are measured at the grant date, based on the estimated fair value of the award, and are recognized as stock-based compensation expense on a straight-line basis over the requisite service period of the entire award, net of the impacts of award forfeitures as they occur. The requisite service period is generally the maximum vesting period of the award. Compensation expense related to the Company’s stock-based equity awards is recorded as selling, general and administrative expenses in the Company’s consolidated statements of operations. The fair value of stock options is determined using a Black-Scholes option pricing model. The fair values of restricted stock unit awards and deferred performance unit awards are based on the fair value of the Company’s common stock on the date that such awards are granted. The fair value of market share unit awards is determined using a Monte Carlo simulation model. For the deferred performance unit awards, the Company adjusts the compensation expense over the service period based upon the expected achievement level of the applicable performance condition. As the grant date fair value of market share unit awards reflects the probabilities of the actual number of such awards expected to vest, compensation expense for such awards is not adjusted based on the expected achievement level of the applicable performance condition. The Company records any excess tax benefits or deficiencies from settlements of its stock-based equity awards within the provision for income taxes on the Company’s consolidated statements of operations in the reporting periods in which the settlement of the equity awards occur. |
Segment Information | Segment Information The Company discloses certain information about its business segments, which are determined consistent with the way the Company’s Chief Operating Decision Maker organizes and evaluates financial information internally for making operating decisions and assessing performance. In addition, the Chief Operating Decision Maker assesses and measures revenue based on product groups. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In March 2018, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2018-05, “Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118” , to add various SEC paragraphs pursuant to the issuance of SEC Staff Accounting Bulletin No. 118 (“SAB 118”), to ASC 740 “Income Taxes” . SAB 118 was issued by the SEC in December 2018 to provide immediate guidance for accounting implications of U.S. tax reform under the “ Tax Cuts and Jobs Act ” (the “Tax Act”), which became effective for the Company on January 1, 2018. The Company has evaluated the potential impacts of SAB 118 and has applied this guidance to its consolidated financial statements and related disclosures beginning in the second quarter of its fiscal year 2018. For additional information on SAB 118 and the impacts of the Tax Act on the Company’s consolidated financial statements and related disclosures, see Note 12 — Income Taxes, included in this report . In January 2017, the FASB issued ASU No. 2017-04, “ Simplifying the Test for Goodwill Impairment ”. The amendments in this updated guidance simplify how an entity is required to test goodwill for impairment due to concerns that were raised about the cost and complexity of annual impairment tests under the existing standard. This updated guidance eliminates Step 2 of the previous two-step quantitative model for goodwill impairment tests. Step 2 required an entity to calculate an implied fair value, which includes a hypothetical purchase price allocation requirement, for reporting units that failed Step 1. Per this updated guidance, a goodwill impairment will instead be measured as the amount by which a reporting unit’s carrying value exceeds its fair value as identified in Step 1. Step 1 will be referred to simply as a “quantitative goodwill impairment test” subsequent to the Company’s adoption of this updated guidance, since Step 2 has been eliminated and “steps” are no longer referred to within the updated guidance. However, the updated guidance still permits the Company to first conduct a qualitative assessment to determine whether it is necessary to perform a quantitative goodwill impairment test. This guidance is effective for fiscal years beginning after December 15, 2019, including interim periods within that reporting period. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company early adopted this guidance in its fiscal year 2018 during the second quarter, the period in which the Company performs its annual goodwill impairment test. The guidance was adopted on a prospective basis and is applicable to all of the Company’s future annual goodwill impairment tests. T he adoption of this guidance did not have an impact on the Company’s consolidated financial statements and related disclosures. See Note 5 – Goodwill and Other Intangible Assets for additional information on the Company’s goodwill. In March 2016, the FASB issued ASU No. 2016-09, “ Improvements to Employee Share-Based Payment Accounting”. The amendments in this updated guidance include changes to simplify the Codification for several aspects of the accounting for share-based payment transactions, including those related to the income tax consequences, classification of awards as either equity or liabilities, accounting for forfeitures, minimum statutory withholding requirements and classification of certain items on the statement of cash flows. Certain of these changes are required to be applied retrospectively while other changes are required to be applied prospectively. This guidance is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period. Early adoption was permitted. The Company did not adopt this updated guidance early and therefore this guidance became effective for the Company during the first quarter of its fiscal year 2018. The impacts of the adoption by the Company of ASU No. 2016-09 in fiscal year 2018 were as follows: · The Company recorded excess tax benefits of $0.7 million within the provision for income taxes for fiscal year 2018 from settlements of stock-based equity awards. Prior to the adoption of this new guidance, these amounts would have been recorded as an increase to additional paid-in capital. · The Company elected to change its policy related to forfeitures of stock-based equity awards upon adoption of this new guidance such that it will now recognize the impacts of forfeitures as they occur rather than recognizing them based on an estimated forfeiture rate. As a result, the Company recorded a cumulative-effect adjustment to retained earnings. This adjustment to retained earnings and the impact of this change in policy for forfeitures on the Company’s consolidated financial statements was not material. · The Company elected to apply the presentation requirements for the statement of cash flows related to excess tax benefits from settlements of stock-based equity awards retrospectively for all periods presented which resulted in an increase of $1.5 million and $2.1 million, respectively, to both net cash provided by operating activities and net cash used in financing activities for fiscal years 2017 and 2016, respectively. · The Company’s presentation in the statement of cash flows of employee taxes paid upon settlement of certain stock-based equity awards via shares withheld by the Company for tax-withholding purposes also changed as a result of the adoption of this new guidance since the Company previously reported such activity as an operating activity rather than a financing activity. As required, the Company applied this change in presentation for the statement of cash flows retrospectively for all periods presented which resulted in an increase of $1.7 million and $2.6 million, respectively, to both net cash provided by operating activities and net cash used in financing activities for fiscal years 2017 and 2016, respectively. · The Company excluded the excess tax benefits from the assumed proceeds available to repurchase shares in the computation of its diluted earnings per share for the fiscal year ended August 31, 2018. The resulting increase in the Company’s diluted weighted average common shares outstanding was not material. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards In August 2018, the FASB issued ASU No. 2018-15, “ Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract ” to align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The updated guidance also requires an entity to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement. This guidance is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. Early adoption is permitted. The Company is in the process of evaluating the impacts of this guidance on its consolidated financial statements and related disclosures. In June 2018, the FASB issued ASU No. 2018-07, “ Improvements to Nonemployee Share-Based Payment Accounting ”. The amendments in this updated guidance simplifies the accounting for nonemployee share-based payment transactions by expanding the scope of ASC 718 “ Stock Compensation ” to include share-based payment transactions for acquiring goods and services from nonemployees. Additionally, the amendments clarify that any share-based payment awards issued to customers should be evaluated under ASC 606 “ Revenue from Contracts with Customers ” (“ASC 606”). This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Early adoption is permitted, but no earlier than an entity’s adoption of ASC 606. The Company has evaluated the potential impacts of this updated guidance, and it does not expect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures. In February 2018, the FASB issued ASU No. 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” , to optionally allow entities to reclassify stranded tax effects, resulting from the Tax Act, from accumulated other comprehensive income to retained earnings. Since the amendments within this guidance only relate to the reclassification of the income tax effects associated with the Tax Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. Early adoption is permitted. The amendments in this updated guidance should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. corporate federal income tax rate in the Tax Act is recognized. The Company has evaluated the potential impacts of this updated guidance, and it does not expect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures, as such stranded tax effects are immaterial. In August 2016, the FASB issued ASU No. 2016-15, “ Classification of Certain Cash Receipts and Cash Payments ”. The amendments in this updated guidance address eight specific cash flow issues to reduce the existing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This guidance is effective for fiscal years beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted and should be applied using a retrospective approach. The Company has evaluated the potential impacts of this updated guidance, and it does not expect the adoption of this guidance to have a material impact on its consolidated financial statements and related disclosures. In February 2016, the FASB issued ASU No. 2016-02, “ Leases”. The new standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than twelve months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. This guidance is effective for fiscal years beginning after December 15, 2018, including interim periods within that reporting period. Although early adoption is permitted, the Company has concluded that it will not adopt this guidance early and it will become effective for the Company on September 1, 2019. The Company will adopt this new guidance following the optional transition method described in ASU No. 2018-11, “ Leases – Targeted Improvements” which was issued in July 2018 , rather than the original modified retrospective approach that requires entities to apply the guidance at the beginning of the earliest period presented in the financial statements. Under the optional transition method, the Company will recognize the cumulative effect of initially applying the guidance as an adjustment to the opening balance of retained earnings on September 1, 2019. Therefore, the requirements of this guidance will apply only for periods presented that are after the date of adoption and will not affect comparative periods The Company is in the process of evaluating the impacts of this guidance on its consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, “ Revenue from Contracts with Customers ”, which supersedes the revenue recognition requirements in ASC 605, “ Revenue Recognition ”. The core principle of this updated guidance and related amendments is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This new guidance requires an entity to recognize revenue for product sales at the point in time in which control of goods transfers to the Company’s customers which, as defined, could be different than the point in time in which revenue had been recognized by the Company under existing U.S. GAAP, which was based on when title and the risks and rewards of ownership were transferred to the customer. The new guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The Company will adopt this new guidance following the modified retrospective approach on September 1, 2018. Management performed a detailed review of the Company’s customer contracts which was focused principally on, but not limited to, identifying the point in time at which the control of goods transfers to customers. Management has also completed both its qualitative and quantitative analysis of this new guidance. Although the Company does not expect a significant impact on consolidated net sales for the Company as a result of this new guidance, management expect s a slight change in the timing for recognizing revenue for certain of its customers. In addition, the Company has finalized all of the necessary updates to its accounting policies, internal controls, processes and information systems regarding revenue recognition, and it is also in the process of drafting new disclosures as required under the new guidance. |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Inventories [Abstract] | |
Schedule Of Inventories | August 31, August 31, 2018 2017 Product held at third-party contract manufacturers $ 2,841 $ 3,021 Raw materials and components 3,692 3,021 Work-in-process 448 215 Finished goods 29,555 29,083 Total $ 36,536 $ 35,340 |
Property And Equipment (Tables)
Property And Equipment (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Property And Equipment [Abstract] | |
Schedule Of Property And Equipment, Net | August 31, August 31, 2018 2017 Machinery, equipment and vehicles $ 17,848 $ 17,491 Buildings and improvements 17,100 16,953 Computer and office equipment 5,046 4,552 Software 9,481 7,947 Furniture and fixtures 1,820 1,608 Capital in progress 8,042 861 Land 3,453 3,453 Subtotal 62,790 52,865 Less: accumulated depreciation and amortization (26,433) (23,426) Total $ 36,357 $ 29,439 |
Goodwill And Other Intangible_2
Goodwill And Other Intangible Assets (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Goodwill And Other Intangible Assets [Abstract] | |
Summary Of Changes In Carrying Amounts Of Goodwill | Americas EMEA Asia-Pacific Total Balance as of August 31, 2016 $ 85,452 $ 8,987 $ 1,210 $ 95,649 Translation adjustments (4) (48) - (52) Balance as of August 31, 2017 85,448 8,939 1,210 95,597 Translation adjustments 1 23 - 24 Balance as of August 31, 2018 $ 85,449 $ 8,962 $ 1,210 $ 95,621 |
Summary Of Definite-Lived Intangible Assets | August 31, August 31, 2018 2017 Gross carrying amount $ 36,122 $ 35,891 Accumulated amortization (22,609) (19,647) Net carrying amount $ 13,513 $ 16,244 |
Summary Of Changes In Carrying Amounts Of Definite-Lived Intangible Assets By Segment | Americas EMEA Asia-Pacific Total Balance as of August 31, 2016 $ 14,913 $ 4,278 $ - $ 19,191 Amortization expense (2,207) (672) - (2,879) Translation adjustments - (68) - (68) Balance as of August 31, 2017 12,706 3,538 - 16,244 Amortization expense (2,237) (714) - (2,951) EZ REACH trade name 175 - - 175 Translation adjustments - 45 - 45 Balance as of August 31, 2018 $ 10,644 $ 2,869 $ - $ 13,513 |
Schedule Of Future Estimated Amortization Expense | Trade Names Customer-Based Fiscal year 2019 $ 2,455 $ 260 Fiscal year 2020 2,055 166 Fiscal year 2021 1,266 166 Fiscal year 2022 1,266 166 Fiscal year 2023 1,020 - Thereafter 4,693 - Total $ 12,755 $ 758 |
Accrued And Other Liabilities (
Accrued And Other Liabilities (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Accrued And Other Liabilities [Abstract] | |
Schedule Of Accrued Liabilities | August 31, August 31, 2018 2017 Accrued advertising and sales promotion expenses $ 11,972 $ 10,889 Accrued professional services fees 1,712 1,456 Accrued sales taxes and other taxes 1,642 1,701 Accrued liability forward contract (1) 6,893 - Other 4,021 4,951 Total $ 26,240 $ 18,997 (1) This accrued liability relates to a foreign currency forward contract that the Company’s U.K. subsidiary entered into with Bank of America to sell U.S. Dollars and receive Pound Sterling. This foreign currency forward contract matured on August 30, 2018, but the settlement of the c urrencies in the amount of $6.9 million did not occur until September 4, 2018. As a result, as of August 31, 2018, the Company owed Bank of America $6.9 million which was recorded in accrued and other liabilities. Bank of America also owed the Company $6.9 million equivalent in Pound Sterling and this was recorded in other current assets as of August 31, 2018. |
Schedule Of Accrued Payroll And Related Expenses | August 31, August 31, 2018 2017 Accrued incentive compensation $ 6,719 $ 6,554 Accrued payroll 3,792 3,338 Accrued profit sharing 2,561 2,257 Accrued payroll taxes 1,236 1,503 Other 515 570 Total $ 14,823 $ 14,222 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Debt [Abstract] | |
Schedule Of Short-term And Long-term Borrowings | August 31, August 31, 2018 2017 Short-term borrowings: Revolving credit facility, short-term $ 20,000 $ 20,000 Revolving credit facility, autoborrow feature 2,800 - Series A Notes, current portion of long-term debt 800 - Total short-term borrowings 23,600 20,000 Long-term borrowings: Revolving credit facility 44,000 134,000 Series A Notes 18,800 - Total long-term borrowings 62,800 134,000 Total $ 86,400 $ 154,000 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Earnings Per Common Share [Abstract] | |
Schedule Of Reconciliation Of Net Income To Net Income Available To Common Shareholders | Fiscal Year Ended August 31, 2018 2017 2016 Net income $ 65,215 $ 52,930 $ 52,628 Less: Net income allocated to participating securities (423) (323) (334) Net income available to common shareholders $ 64,792 $ 52,607 $ 52,294 |
Schedule Of Weighted Average Number Of Shares | Fiscal Year Ended August 31, 2018 2017 2016 Weighted-average common shares outstanding, basic 13,929 14,089 14,332 Weighted-average dilutive securities 33 34 47 Weighted-average common shares outstanding, diluted 13,962 14,123 14,379 |
Commitments And Contingencies (
Commitments And Contingencies (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Commitments And Contingencies [Abstract] | |
Future Minimum Rental Payments | 2019 2020 2021 2022 2023 Thereafter Leases $ 2,003 $ 1,517 $ 1,168 $ 694 $ 379 $ 1,198 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Income Taxes [Abstract] | |
Schedule Of Income Before Income Tax, Domestic And Foreign | Fiscal Year Ended August 31, 2018 2017 2016 United States $ 42,634 $ 42,060 $ 41,128 Foreign (1) 32,544 32,562 31,661 Income before income taxes $ 75,178 $ 74,622 $ 72,789 (1) Included in these amounts are income before income taxes for the EMEA segment of $27.4 million, $28.1 million and $28.3 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. |
Schedule Of Components Of Income Tax Expense (Benefit) | Fiscal Year Ended August 31, 2018 2017 2016 Current: Federal $ 10,100 $ 10,813 $ 13,269 State 651 744 894 Foreign 6,750 7,465 7,593 Total current 17,501 19,022 21,756 Deferred: United States (7,496) 2,627 (1,100) Foreign (42) 43 (495) Total deferred (7,538) 2,670 (1,595) Provision for income taxes $ 9,963 $ 21,692 $ 20,161 |
Schedule Of Deferred Tax Assets And Liabilities | August 31, August 31, 2018 2017 Deferred tax assets: Accrued payroll and related expenses $ 916 $ 1,252 Accounts receivable 303 644 Reserves and accruals 1,496 2,393 Stock-based compensation expense 2,321 3,213 Uniform capitalization 959 1,598 Tax credit carryforwards 2,790 2,309 Other 938 1,289 Total gross deferred tax assets 9,723 12,698 Valuation allowance (2,505) (2,328) Total net deferred tax assets 7,218 10,370 Deferred tax liabilities: Property and equipment, net (1,305) (2,109) Amortization of tax goodwill and intangible assets (16,108) (26,036) Investments in partnerships (222) (679) Other (122) - Total deferred tax liabilities (17,757) (28,824) Net deferred tax liabilities $ (10,539) $ (18,454) |
Schedule Of Effective Income Tax Rate Reconciliation | Fiscal Year Ended August 31, 2018 2017 2016 Amount computed at U.S. statutory federal tax rate $ 19,298 $ 26,118 $ 25,476 State income taxes, net of federal tax benefits 453 327 397 Effect of foreign operations (1,412) (4,277) (4,382) Benefit from qualified domestic production deduction (1,121) (1,295) (1,190) Tax Cuts and Jobs Act: Remeasurement of deferred income taxes (6,762) - - Toll tax, net of foreign tax credits (282) - - Benefit from Stock Compensation (725) - - Other 514 819 (140) Provision for income taxes $ 9,963 $ 21,692 $ 20,161 |
Schedule Of Unrecognized Tax Benefits Roll Forward | Fiscal Year Ended August 31, 2018 2017 Unrecognized tax benefits - beginning of fiscal year $ 981 $ 1,239 Net increases (decreases) - prior period tax positions 62 (68) Net increases - current period tax positions 263 228 Expirations of statute of limitations for assessment (197) (382) Settlements (71) (36) Unrecognized tax benefits - end of fiscal year $ 1,038 $ 981 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Stock Options Activity | Weighted-Average Remaining Weighted-Average Contractual Term Number of Exercise Price Per Share Aggregate Stock Options Shares Per Share (in years) Intrinsic Value Outstanding at August 31, 2017 5,960 $ 36.03 Granted - $ - Exercised (5,960) $ 36.03 Forfeited or expired - $ - Outstanding at August 31, 2018 - $ - - $ - Exercisable at August 31, 2018 - $ - - $ - |
Restricted Stock Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Restricted Stock Units Activity | Weighted-Average Grant Date Number of Fair Value Aggregate Restricted Stock Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 116,770 $ 63.61 Granted 24,114 $ 111.71 Converted to common shares (24,471) $ 76.58 Forfeited (1,105) $ 104.24 Outstanding at August 31, 2018 115,308 $ 70.52 $ 20,461 Vested at August 31, 2018 87,309 $ 59.22 $ 15,493 |
Market Share Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Valuation Assumptions | Fiscal Year Ended August 31, 2018 2017 2016 Expected volatility 20.4% 21.1% 22.2% Risk-free interest rate 1.6% 1.0% 0.9% Expected dividend yield 0.0% 0.0% 0.0% |
Schedule Of Market Share Units Activity | Weighted-Average Grant Date Number of Fair Value Aggregate Market Share Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 44,919 $ 94.95 Granted 15,729 $ 101.93 Performance factor adjustments 12,194 $ 76.04 Converted to common shares (27,589) $ 74.30 Forfeited (3,045) $ 91.87 Outstanding at August 31, 2018 (1) 42,208 $ 105.81 $ 7,490 (1) This figure represents the total number of shares underlying MSU grants assuming achievement of the target number of shares at 100%. As the ultimate number of shares that vest could be as high as 200% of the target, the Company may be required to issue additional shares to satisfy outstanding MSU award grants. |
Deferred Performance Units [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule Of Deferred Performance Share Units | Weighted-Average Grant Date Number of Fair Value Aggregate Deferred Performance Units Shares Per Share Intrinsic Value Outstanding at August 31, 2017 30,876 $ 107.66 Granted 26,906 $ 110.65 Performance factor adjustments (25,882) $ 110.19 Converted to common shares (192) $ 94.54 Forfeited (940) $ 110.65 Outstanding at August 31, 2018 30,768 $ 108.14 $ 5,460 Vested at August 31, 2018 4,802 $ 94.54 $ 852 |
Business Segments And Foreign_2
Business Segments And Foreign Operations (Tables) | 12 Months Ended |
Aug. 31, 2018 | |
Business Segments And Foreign Operations [Abstract] | |
Summarized Information By Reportable Segments | Unallocated Americas EMEA Asia-Pacific Corporate (1) Total Fiscal Year Ended August 31, 2018 Net sales $ 192,878 $ 150,878 $ 64,762 $ - $ 408,518 Income from operations $ 48,954 $ 36,241 $ 19,098 $ (25,689) $ 78,604 Depreciation and amortization expense $ 4,142 $ 2,561 $ 313 $ 784 $ 7,800 Interest income $ 13 $ 320 $ 121 $ - $ 454 Interest expense $ 4,209 $ - $ 10 $ - $ 4,219 Fiscal Year Ended August 31, 2017 Net sales $ 184,929 $ 136,771 $ 58,806 $ - $ 380,506 Income from operations $ 48,303 $ 35,389 $ 16,765 $ (24,548) $ 75,909 Depreciation and amortization expense $ 4,270 $ 2,090 $ 254 $ 155 $ 6,769 Interest income $ 8 $ 389 $ 111 $ - $ 508 Interest expense $ 2,570 $ - $ 12 $ - $ 2,582 Fiscal Year Ended August 31, 2016 Net sales $ 191,397 $ 135,235 $ 54,038 $ - $ 380,670 Income from operations $ 48,404 $ 31,702 $ 15,162 $ (23,920) $ 71,348 Depreciation and amortization expense $ 4,071 $ 2,084 $ 280 $ 30 $ 6,465 Interest income $ 5 $ 485 $ 193 $ - $ 683 Interest expense $ 1,689 $ - $ 14 $ - $ 1,703 (1) Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the operating segments. These expenses are reported separate from the Company’s identified segments and are included in Selling, General and Administrative expenses on the Company’s consolidated statements of operations. |
Schedule Of Net Sales By Product Group | Fiscal Year Ended August 31, 2018 2017 2016 Maintenance products $ 372,391 $ 342,295 $ 339,974 Homecare and cleaning products 36,127 38,211 40,696 Total $ 408,518 $ 380,506 $ 380,670 |
Net Sales And Long-Lived Assets By Geographical Area | Fiscal Year Ended August 31, 2018 2017 2016 Net Sales by Geography: United States $ 154,986 $ 150,086 $ 158,139 International 253,532 230,420 222,531 Total $ 408,518 $ 380,506 $ 380,670 Long-lived Assets by Geography (2) : United States $ 21,986 $ 23,346 $ 6,419 International 14,371 6,093 5,126 Total $ 36,357 $ 29,439 $ 11,545 (2) Includes tangible assets and property and equipment, net, attributed to the geographic location in which such assets are located. |
Basis Of Presentation And Sum_3
Basis Of Presentation And Summary Of Significant Accounting Policies (Short-term Investments) (Narrative) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | ||
Short-term investments | $ 219 | $ 80,166 |
Basis Of Presentation And Sum_4
Basis Of Presentation And Summary Of Significant Accounting Policies (Property And Equipment) (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Property Plant And Equipment [Line Items] | |||
Depreciation | $ 4.8 | $ 3.9 | $ 3.5 |
Cost of goods sold, depreciation | $ 1.1 | $ 1.1 | $ 0.8 |
Minimum [Member] | Buildings And Improvements [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 10 years | ||
Minimum [Member] | Machinery And Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 3 years | ||
Minimum [Member] | Vehicles [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 3 years | ||
Minimum [Member] | Furniture And Fixtures [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 3 years | ||
Minimum [Member] | Software and Computer Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 3 years | ||
Maximum [Member] | Buildings And Improvements [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 40 years | ||
Maximum [Member] | Machinery And Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 15 years | ||
Maximum [Member] | Vehicles [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 5 years | ||
Maximum [Member] | Furniture And Fixtures [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 10 years | ||
Maximum [Member] | Software and Computer Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, useful life | 5 years |
Basis Of Presentation And Sum_5
Basis Of Presentation And Summary Of Significant Accounting Policies (Software) (Narrative) (Details) | 12 Months Ended |
Aug. 31, 2018 | |
Minimum [Member] | |
Finite Lived Intangible Assets [Line Items] | |
Estimated useful life | 3 years |
Maximum [Member] | |
Finite Lived Intangible Assets [Line Items] | |
Estimated useful life | 5 years |
Basis Of Presentation And Sum_6
Basis Of Presentation And Summary Of Significant Accounting Policies (Goodwill) (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | ||||
Impairment of goodwill | $ 0 | $ 0 | $ 0 | $ 0 |
Basis Of Presentation And Sum_7
Basis Of Presentation And Summary Of Significant Accounting Policies (Long-lived Assets) (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 |
Basis Of Presentation And Sum_8
Basis Of Presentation And Summary Of Significant Accounting Policies (Fair Value Of Financial Instruments) (Narrative) (Details) - USD ($) | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Carrying value of senior notes | $ 62,800,000 | $ 134,000,000 | |
Senior Notes [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Fair value of senior notes | 18,800,000 | ||
Carrying value of senior notes | 19,600,000 | ||
Level 2 [Member] | Recurring [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Assets | 0 | ||
Liabilities | 0 | ||
Level 2 [Member] | Nonrecurring [Member] | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Assets | 0 | 0 | $ 0 |
Liabilities | $ 0 | $ 0 | $ 0 |
Basis Of Presentation And Sum_9
Basis Of Presentation And Summary Of Significant Accounting Policies (Insurance Coverage) (Narrative) (Details) - USD ($) | Aug. 31, 2018 | Aug. 31, 2017 |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | ||
Self-insurance reserves | $ 0 | $ 0 |
Basis Of Presentation And Su_10
Basis Of Presentation And Summary Of Significant Accounting Policies (Shipping And Handling Costs) (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |||
Shipping and handling costs | $ 17.7 | $ 16.4 | $ 16.1 |
Basis Of Presentation And Su_11
Basis Of Presentation And Summary Of Significant Accounting Policies (Advertising and Sales Promotion Expenses) (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |||
Advertising and sales promotion | $ 22,314 | $ 20,537 | $ 22,278 |
Basis Of Presentation And Su_12
Basis Of Presentation And Summary Of Significant Accounting Policies (Research And Development) (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Abstract] | |||
Research and development expense | $ 7 | $ 8.4 | $ 7.7 |
Basis Of Presentation And Su_13
Basis Of Presentation And Summary Of Significant Accounting Policies (Foreign Currency) (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Foreign Currency Transactions [Line Items] | |||
Foreign currency transactions gain (loss), before tax | $ 100 | $ 400 | $ 2,400 |
Foreign currency forward contracts outstanding | 23,100 | ||
Unrealized net losses | $ (302) | 364 | $ (986) |
Foreign Currency Forward Contracts [Member] | |||
Foreign Currency Transactions [Line Items] | |||
Unrealized net losses | 600 | ||
Realized net losses | $ 500 |
Basis Of Presentation And Su_14
Basis Of Presentation And Summary Of Significant Accounting Policies (Recently Adopted Accounting Standards) (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Excess tax benefits | $ 9,963 | $ 21,692 | $ 20,161 |
Accounting Standards Update 2016-09 [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Excess tax benefits | $ 700 | ||
Excess tax benefits, Operating activities | 1,500 | 2,100 | |
Excess tax benefits, Financing activities | 1,500 | 2,100 | |
Payments related to tax withholding for share-based compensation, Operating activities | 1,700 | 2,600 | |
Payments related to tax withholding for share-based compensation, Financing activities | $ 1,700 | $ 2,600 |
Inventories (Schedule Of Invent
Inventories (Schedule Of Inventories) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Inventories [Abstract] | ||
Product held at third-party contract manufacturers | $ 2,841 | $ 3,021 |
Raw materials and components | 3,692 | 3,021 |
Work-in-process | 448 | 215 |
Finished goods | 29,555 | 29,083 |
Total | $ 36,536 | $ 35,340 |
Property And Equipment (Narrati
Property And Equipment (Narrative) (Details) - Aug. 31, 2018 £ in Millions, $ in Millions | GBP (£) | USD ($) |
Property And Equipment [Abstract] | ||
Capital costs | £ 5.6 | $ 7.3 |
Property And Equipment (Schedul
Property And Equipment (Schedule Of Property And Equipment, Net) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Property Plant And Equipment [Line Items] | ||||
Subtotal | $ 62,790 | $ 52,865 | ||
Less: accumulated depreciation and amortization | (26,433) | (23,426) | ||
Total | [1] | 36,357 | 29,439 | $ 11,545 |
Machinery, Equipment and Vehicles [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 17,848 | 17,491 | ||
Buildings And Improvements [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 17,100 | 16,953 | ||
Computer And Office Equipment [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 5,046 | 4,552 | ||
Software [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 9,481 | 7,947 | ||
Furniture And Fixtures [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 1,820 | 1,608 | ||
Capital In Progress [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | 8,042 | 861 | ||
Land [Member] | ||||
Property Plant And Equipment [Line Items] | ||||
Subtotal | $ 3,453 | $ 3,453 | ||
[1] | Includes tangible assets and property and equipment, net, attributed to the geographic location in which such assets are located. |
Goodwill And Other Intangible_3
Goodwill And Other Intangible Assets (Acquisitions) (Narrative) (Details) - Trade Names [Member] - EZ REACH [Member] $ in Millions | 3 Months Ended |
Nov. 30, 2017USD ($) | |
Finite Lived Intangible Assets [Line Items] | |
Purchase consideration | $ 0.2 |
Estimated useful life | 5 years |
Goodwill And Other Intangible_4
Goodwill And Other Intangible Assets (Goodwill And Definite-Lived Intangible Assets) (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Goodwill And Other Intangible Assets [Abstract] | ||||
Impairment of goodwill | $ 0 | $ 0 | $ 0 | $ 0 |
Impairment charges | $ 0 | $ 0 | $ 0 |
Goodwill And Other Intangible_5
Goodwill And Other Intangible Assets (Summary Of Changes In Carrying Amounts Of Goodwill) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Goodwill [Line Items] | ||
Balance, beginning | $ 95,597 | $ 95,649 |
Translation adjustments | 24 | (52) |
Balance, ending | 95,621 | 95,597 |
Americas [Member] | ||
Goodwill [Line Items] | ||
Balance, beginning | 85,448 | 85,452 |
Translation adjustments | 1 | (4) |
Balance, ending | 85,449 | 85,448 |
EMEA [Member] | ||
Goodwill [Line Items] | ||
Balance, beginning | 8,939 | 8,987 |
Translation adjustments | 23 | (48) |
Balance, ending | 8,962 | 8,939 |
Asia-Pacific [Member] | ||
Goodwill [Line Items] | ||
Balance, beginning | 1,210 | 1,210 |
Translation adjustments | ||
Balance, ending | $ 1,210 | $ 1,210 |
Goodwill And Other Intangible_6
Goodwill And Other Intangible Assets (Summary Of Definite-Lived Intangible Assets) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 |
Goodwill And Other Intangible Assets [Abstract] | |||
Gross carrying amount | $ 36,122 | $ 35,891 | |
Accumulated amortization | (22,609) | (19,647) | |
Net carrying amount | $ 13,513 | $ 16,244 | $ 19,191 |
Goodwill And Other Intangible_7
Goodwill And Other Intangible Assets (Summary Of Changes In Carrying Amounts Of Definite-Lived Intangible Assets By Segment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Beginning balance | $ 16,244 | $ 19,191 | |
Amortization expense | (2,951) | (2,879) | $ (2,976) |
EZ REACH trade name | 175 | ||
Translation adjustments | 45 | (68) | |
Ending balance | 13,513 | 16,244 | 19,191 |
Americas [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Beginning balance | 12,706 | 14,913 | |
Amortization expense | (2,237) | (2,207) | |
EZ REACH trade name | 175 | ||
Translation adjustments | |||
Ending balance | 10,644 | 12,706 | 14,913 |
EMEA [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Beginning balance | 3,538 | 4,278 | |
Amortization expense | (714) | (672) | |
Translation adjustments | 45 | (68) | |
Ending balance | 2,869 | 3,538 | 4,278 |
Asia-Pacific [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Beginning balance | |||
Amortization expense | |||
EZ REACH trade name | |||
Translation adjustments | |||
Ending balance |
Goodwill And Other Intangible_8
Goodwill And Other Intangible Assets (Schedule Of Future Estimated Amortization Expense) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | |||
Net carrying amount | $ 13,513 | $ 16,244 | $ 19,191 |
Trade Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Fiscal year 2019 | 2,455 | ||
Fiscal year 2020 | 2,055 | ||
Fiscal year 2021 | 1,266 | ||
Fiscal year 2022 | 1,266 | ||
Fiscal year 2023 | 1,020 | ||
Thereafter | 4,693 | ||
Net carrying amount | 12,755 | ||
Customer-Based [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Fiscal year 2019 | 260 | ||
Fiscal year 2020 | 166 | ||
Fiscal year 2021 | 166 | ||
Fiscal year 2022 | 166 | ||
Net carrying amount | $ 758 |
Accrued And Other Liabilities_2
Accrued And Other Liabilities (Schedule Of Accrued Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 | |
Line of Credit Facility [Line Items] | |||
Accrued advertising and sales promotion expenses | $ 11,972 | $ 10,889 | |
Accrued professional services fees | 1,712 | 1,456 | |
Accrued sales taxes and other taxes | 1,642 | 1,701 | |
Accrued liability forward contract | [1] | 6,893 | |
Other | 4,021 | 4,951 | |
Total | 26,240 | 18,997 | |
Other current assets | 13,337 | $ 8,007 | |
Bank Of America [Member] | |||
Line of Credit Facility [Line Items] | |||
Other | 6,900 | ||
Other current assets | $ 6,900 | ||
[1] | This accrued liability relates to a foreign currency forward contract that the Company's U.K. subsidiary entered into with Bank of America to sell U.S. Dollars and receive Pound Sterling. This foreign currency forward contract matured on August 30, 2018, but the settlement of the currencies in the amount of $6.9 million did not occur until September 4, 2018. As a result, as of August 31, 2018, the Company owed Bank of America $6.9 million which was recorded in accrued and other liabilities. Bank of America also owed the Company $6.9 million equivalent in Pound Sterling and this was recorded in other current assets as of August 31, 2018. |
Accrued And Other Liabilities_3
Accrued And Other Liabilities (Schedule Of Accrued Payroll And Related Expenses) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Accrued And Other Liabilities [Abstract] | ||
Accrued incentive compensation | $ 6,719 | $ 6,554 |
Accrued payroll | 3,792 | 3,338 |
Accrued profit sharing | 2,561 | 2,257 |
Accrued payroll taxes | 1,236 | 1,503 |
Other | 515 | 570 |
Total | $ 14,823 | $ 14,222 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Aug. 31, 2018 | Feb. 28, 2018 | Aug. 31, 2018 | Feb. 23, 2018 | Nov. 15, 2017 | Aug. 31, 2017 | |
Debt Instrument [Line Items] | ||||||
Current debt | $ 23,600,000 | $ 23,600,000 | $ 20,000,000 | |||
Long-term borrowings | 62,800,000 | 62,800,000 | 134,000,000 | |||
Repatriation of foreign earnings | 79,600,000 | |||||
Refinanced short-term debt | 64,000,000 | |||||
Series A Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term borrowings | 18,800,000 | 18,800,000 | ||||
Repayments of line of credit | $ 20,000,000 | |||||
Repayment of principal | 400,000 | |||||
Fifth Amended Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Revolving credit facility, amount | 175,000,000 | 175,000,000 | ||||
Share buy-back plan, amount authorized | $ 150,000,000 | $ 150,000,000 | ||||
Revolving credit facility, expiration date | May 13, 2020 | |||||
Sixth Amended Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Consolidated leverage ratio | 3 | 3 | ||||
Consolidated interest coverage ratio | 3 | 3 | ||||
Revolving Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Short-term | $ 20,000,000 | $ 20,000,000 | 20,000,000 | |||
Long-term borrowings | 44,000,000 | 44,000,000 | $ 134,000,000 | |||
Revolving Credit Facility [Member] | Series A Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Repayment of short-term debt | 20,000,000 | |||||
Revolving Credit Facility [Member] | Line Of Credit, Headquarters Office [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, short-term liability | 10,000,000 | 10,000,000 | ||||
Revolving Credit Facility [Member] | Autoborrow Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Short-term | 2,800,000 | 2,800,000 | ||||
Line Of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Refinanced short-term debt | 20,000,000 | |||||
Line Of Credit [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Short-term | 80,000,000 | 80,000,000 | ||||
Repatriation of foreign earnings | 79,600,000 | |||||
Refinanced short-term debt | 44,000,000 | |||||
Note Agreement [Member] | Series A Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Revolving credit facility, amount | $ 20,000,000 | |||||
Principal amount | $ 20,000,000 | $ 20,000,000 | ||||
Interest rate | 3.39% | 3.39% | ||||
Maturity date | Nov. 15, 2032 | |||||
Principal payment frequency of periodic payment | semi-annually | |||||
Date of first payment required | May 15, 2018 | |||||
Periodic payment amount | $ 400,000 | |||||
Date of final semi-annual payment required | May 15, 2032 | |||||
Balloon payment | $ 8,400,000 | $ 8,400,000 | ||||
Note Agreement [Member] | Sixth Amended Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Additional maximum borrowing capacity | $ 15,000,000 | |||||
Shelf Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | 0 | $ 0 | ||||
Latest date to issue senior notes | Nov. 15, 2020 | |||||
Period of debt issuance and maturity | 15 years 6 months | |||||
Maximum [Member] | Shelf Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Additional maximum borrowing capacity | $ 105,000,000 | $ 105,000,000 | ||||
Milton Keynes, England [Member] | Sixth Amended Credit Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Revolving credit facility, amount | 15,000,000 | |||||
Milton Keynes, England [Member] | Note Agreement [Member] | Note Amendment [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Revolving credit facility, amount | $ 15,000,000 |
Debt (Schedule Of Short-term An
Debt (Schedule Of Short-term And Long-term Borrowings) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Debt Instrument [Line Items] | ||
Total short-term borrowings | $ 23,600 | $ 20,000 |
Long-term borrowings | 62,800 | 134,000 |
Total | 86,400 | 154,000 |
Series A Notes [Member] | ||
Debt Instrument [Line Items] | ||
Current portion of long-term debt | 800 | |
Long-term borrowings | 18,800 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | 20,000 | 20,000 |
Long-term borrowings | 44,000 | $ 134,000 |
Revolving Credit Facility [Member] | Autoborrow Agreement [Member] | ||
Debt Instrument [Line Items] | ||
Short-term borrowings | $ 2,800 |
Share Repurchase Plan (Narrativ
Share Repurchase Plan (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | 24 Months Ended | ||||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | Aug. 31, 2018 | Sep. 01, 2018 | Sep. 01, 2016 | |
Equity, Class of Treasury Stock [Line Items] | ||||||
Total cost of repurchased shares | $ 22,616 | $ 31,109 | $ 32,131 | |||
2016 To 2018 Share Repurchase Program [Member] | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share buy-back plan, amount authorized | $ 75,000 | $ 75,000 | ||||
Share buy-back plan, number of shares repurchased | 175,306 | 465,879 | ||||
Average price of shares repurchased | $ 128.99 | |||||
Total cost of repurchased shares | $ 22,600 | $ 53,700 | ||||
Maximum [Member] | 2016 To 2018 Share Repurchase Program [Member] | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share buy-back plan, amount authorized | $ 75,000 | |||||
Subsequent Events [Member] | Maximum [Member] | 2018 To 2020 Share Repurchase Program [Member] | ||||||
Equity, Class of Treasury Stock [Line Items] | ||||||
Share buy-back plan, amount authorized | $ 75,000 |
Earnings Per Common Share (Narr
Earnings Per Common Share (Narrative) (Details) - shares | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Earnings Per Common Share [Abstract] | |||
Anti-dilutive stock options outstanding | 0 | 0 | 4,501 |
Earnings Per Common Share (Sche
Earnings Per Common Share (Schedule Of Reconciliation Of Net Income To Net Income Available To Common Shareholders) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Earnings Per Common Share [Abstract] | |||
Net income | $ 65,215 | $ 52,930 | $ 52,628 |
Less: Net income allocated to participating securities | (423) | (323) | (334) |
Net income available to common shareholders | $ 64,792 | $ 52,607 | $ 52,294 |
Earnings Per Common Share (Sc_2
Earnings Per Common Share (Schedule Of Weighted Average Number Of Shares) (Details) - shares shares in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Earnings Per Common Share [Abstract] | |||
Weighted-average common shares outstanding, basic | 13,929 | 14,089 | 14,332 |
Weighted-average dilutive securities | 33 | 34 | 47 |
Weighted-average common shares outstanding, diluted | 13,962 | 14,123 | 14,379 |
Related Parties (Narrative) (De
Related Parties (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Related Parties [Abstract] | |||
Sales to Tractor Supply | $ 1,400,000 | $ 1,200,000 | $ 1,200,000 |
Accounts receivable from Tractor Supply | $ 500,000 | $ 0 |
Commitments And Contingencies_2
Commitments And Contingencies (Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2018 | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Loss Contingencies [Line Items] | ||||
Rent expense | $ 2,000,000 | $ 2,100,000 | $ 1,900,000 | |
Litigation settlement | $ 1,500,000 | |||
Purchase Commitment [Member] | ||||
Loss Contingencies [Line Items] | ||||
Commitment outstanding | 0 | |||
Indemnification Agreement 1 [Member] | ||||
Loss Contingencies [Line Items] | ||||
Liabilities related to indemnification agreement | 0 | |||
Senior Officers And Directors [Member] | Indemnification Agreement 1 [Member] | ||||
Loss Contingencies [Line Items] | ||||
Liabilities related to indemnification agreement | $ 0 |
Commitments And Contingencies_3
Commitments And Contingencies (Future Minimum Rental Payments) (Details) $ in Thousands | Aug. 31, 2018USD ($) |
Commitments And Contingencies [Abstract] | |
2,019 | $ 2,003 |
2,020 | 1,517 |
2,021 | 1,168 |
2,022 | 694 |
2,023 | 379 |
Thereafter | $ 1,198 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) | 3 Months Ended | 4 Months Ended | 8 Months Ended | 12 Months Ended | |||
Aug. 31, 2018 | Feb. 28, 2018 | Dec. 31, 2017 | Aug. 31, 2018 | Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Income Tax [Line Items] | |||||||
Operating loss carryforwards | $ 3,000,000 | $ 3,000,000 | $ 3,000,000 | $ 2,600,000 | |||
Net deferred tax asset | 200,000 | 200,000 | 200,000 | 200,000 | |||
Tax credit carryforwards | 2,790,000 | 2,790,000 | 2,790,000 | 2,309,000 | |||
Provision for income taxes | 9,963,000 | 21,692,000 | $ 20,161,000 | ||||
Deferred income taxes | $ (7,538,000) | $ 2,670,000 | (1,595,000) | ||||
Percentage for provision for income taxes | 13.30% | 29.10% | |||||
Repatriation of foreign earnings | 79,600,000 | ||||||
Material interest or penalties included in income tax expense | $ 0 | $ 0 | |||||
Unrecognized tax benefits | 1,038,000 | 1,038,000 | 1,038,000 | 981,000 | $ 1,239,000 | ||
Unrecognized tax benefits that would impact the effective tax rate | 900,000 | 900,000 | 900,000 | 600,000 | |||
Unrecognized tax benefits affected by the resolution of tax examinations or expiring statutes of limitation | 200,000 | $ 200,000 | $ 200,000 | ||||
Federal income tax rate | 35.00% | 21.00% | 25.70% | ||||
Percentage between blended rate and prior fiscal year | 9.00% | ||||||
Provision for income taxes | 100,000 | $ 6,900,000 | $ 7,100,000 | ||||
Remeasurement of deferred income taxes | (6,762,000) | ||||||
Toll tax | (282,000) | ||||||
Tax benefit | (7,100,000) | ||||||
Foreign Tax Authority [Member] | |||||||
Income Tax [Line Items] | |||||||
Tax credit carryforwards | 2,500,000 | $ 2,500,000 | 2,500,000 | $ 2,100,000 | |||
Line Of Credit [Member] | |||||||
Income Tax [Line Items] | |||||||
Repatriation of foreign earnings | 79,600,000 | ||||||
Short-term | $ 80,000,000 | $ 80,000,000 | $ 80,000,000 |
Income Taxes (Schedule Of Incom
Income Taxes (Schedule Of Income before Income Tax, Domestic And Foreign) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | ||
Income Tax [Line Items] | ||||
United States | $ 42,634 | $ 42,060 | $ 41,128 | |
Foreign | [1] | 32,544 | 32,562 | 31,661 |
Income before income taxes | 75,178 | 74,622 | 72,789 | |
EMEA [Member] | ||||
Income Tax [Line Items] | ||||
Foreign | $ 27,400 | $ 28,100 | $ 28,300 | |
[1] | Included in these amounts are income before income taxes for the EMEA segment of $27.4 million, $28.1 million and $28.3 million for the fiscal years ended August 31, 2018, 2017 and 2016, respectively. |
Income Taxes (Schedule Of Compo
Income Taxes (Schedule Of Components Of Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Income Taxes [Abstract] | |||
Current, Federal | $ 10,100 | $ 10,813 | $ 13,269 |
Current, State | 651 | 744 | 894 |
Current, Foreign | 6,750 | 7,465 | 7,593 |
Total current | 17,501 | 19,022 | 21,756 |
Deferred, United States | (7,496) | 2,627 | (1,100) |
Deferred, Foreign | (42) | 43 | (495) |
Total deferred | (7,538) | 2,670 | (1,595) |
Provision for income taxes | $ 9,963 | $ 21,692 | $ 20,161 |
Income Taxes (Schedule Of Defer
Income Taxes (Schedule Of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Aug. 31, 2018 | Aug. 31, 2017 |
Income Taxes [Abstract] | ||
Accrued payroll and related expenses | $ 916 | $ 1,252 |
Account receivable | 303 | 644 |
Reserves and accruals | 1,496 | 2,393 |
Stock-based compensation expense | 2,321 | 3,213 |
Uniform capitalization | 959 | 1,598 |
Tax credit carryforwards | 2,790 | 2,309 |
Other | 938 | 1,289 |
Total gross deferred tax assets | 9,723 | 12,698 |
Valuation allowance | (2,505) | (2,328) |
Total net deferred tax assets | 7,218 | 10,370 |
Property and equipment, net | (1,305) | (2,109) |
Amortization of tax goodwill and intangible assets | (16,108) | (26,036) |
Investments in partnerships | (222) | (679) |
Other | (122) | |
Total deferred tax liabilities | (17,757) | (28,824) |
Net deferred tax liabilities | $ (10,539) | $ (18,454) |
Income Taxes (Schedule Of Effec
Income Taxes (Schedule Of Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Income Taxes [Abstract] | |||
Amount computed at U.S. statutory federal tax rate | $ 19,298 | $ 26,118 | $ 25,476 |
State income taxes, net of federal tax benefits | 453 | 327 | 397 |
Effect of foreign operations | (1,412) | (4,277) | (4,382) |
Benefit from qualified domestic production deduction | (1,121) | (1,295) | (1,190) |
Remeasurement of deferred income taxes | (6,762) | ||
Toll tax | (282) | ||
Benefit from Stock Compensation | (725) | ||
Other | 514 | 819 | (140) |
Provision for income taxes | $ 9,963 | $ 21,692 | $ 20,161 |
Income Taxes (Schedule Of Unrec
Income Taxes (Schedule Of Unrecognized Tax Benefits Roll Forward) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2018 | Aug. 31, 2017 | |
Income Taxes [Abstract] | ||
Unrecognized tax benefits - Beginning of fiscal year | $ 981 | $ 1,239 |
Net increases (decreases) - prior period tax positions | 62 | |
Net increases (decreases) - prior period tax positions | (68) | |
Net increases - current period tax positions | 263 | 228 |
Expirations of statute of limitations for assessment | (197) | (382) |
Settlements | (71) | (36) |
Unrecognized tax benefits - End of fiscal year | $ 1,038 | $ 981 |
Stock-based Compensation (Narra
Stock-based Compensation (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares authorized under stock plan | 1,000,000 | ||
Number of shares available for grant | 786,364 | ||
Allocated share-based compensation expense | $ 4,200,000 | $ 4,100,000 | $ 3,700,000 |
Employee service share-based, Tax benefit from compensation expense | 1,100,000 | 1,400,000 | 1,200,000 |
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee service share-based, Tax benefit from compensation expense | $ 100,000 | 400,000 | 700,000 |
Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Employee service share-based, Tax benefit from compensation expense | $ 700,000 | $ 1,300,000 | $ 1,000,000 |
Compensation cost not yet recognized | $ 600,000 | ||
Remaining weighted-average vesting periods | 1 year 7 months 6 days | ||
Weighted-average grant date fair value | $ 111.71 | $ 109.23 | $ 95.89 |
Total intrinsic value of stock-based awards converted into common shares | $ 2,800,000 | $ 3,600,000 | $ 2,800,000 |
Market Share Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Employee service share-based, Tax benefit from compensation expense | $ 800,000 | $ 900,000 | $ 1,200,000 |
Compensation cost not yet recognized | $ 1,700,000 | ||
Remaining weighted-average vesting periods | 1 year 9 months 18 days | ||
Weighted-average grant date fair value | $ 101.93 | $ 90.91 | $ 120.99 |
Total intrinsic value of stock-based awards converted into common shares | $ 3,000,000 | $ 2,800,000 | $ 3,700,000 |
Deferred Performance Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | ||
Compensation cost not yet recognized | $ 0 | ||
Weighted-average grant date fair value | $ 110.65 | $ 110.19 | $ 94.54 |
Stock-based Compensation (Sched
Stock-based Compensation (Schedule of Stock Options Activity) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Income tax benefit (expense) from stock-based award | $ 1.1 | $ 1.4 | $ 1.2 |
Stock Options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, Number of Shares | 5,960 | ||
Granted, Number of Shares | |||
Exercised, Number of Shares | (5,960) | ||
Forfeited or expired, Number of Shares | |||
Outstanding, Number of Shares | 5,960 | ||
Exercisable, Number of Shares | |||
Outstanding, Weighted-Average Exercise Price Per Share | $ 36.03 | ||
Granted, Weighted-Average Exercise Price Per Share | |||
Exercised, Weighted-Average Exercise Price Per Share | 36.03 | ||
Forfeited or expired, Weighted-Average Exercise Price Per Share | |||
Outstanding, Weighted-Average Exercise Price Per Share | $ 36.03 | ||
Exercisable, Weighted-Average Exercise Price Per Share | |||
Total intrinsic value of stock options exercised | $ 0.5 | $ 1.6 | 2.5 |
Income tax benefit (expense) from stock-based award | $ 0.1 | $ 0.4 | $ 0.7 |
Stock-based Compensation (Sch_2
Stock-based Compensation (Schedule Of Restricted Stock Units Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Income tax benefit (expense) from stock-based award | $ 1,100 | $ 1,400 | $ 1,200 |
Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, Number of Shares | 116,770 | ||
Granted, Number of Shares | 24,114 | ||
Converted to common shares, Number of Shares | (24,471) | ||
Forfeited, Number of Shares | (1,105) | ||
Outstanding, Number of Shares | 115,308 | 116,770 | |
Vested, Number of Shares | 87,309 | ||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | $ 63.61 | ||
Granted, Weighted-Average Grant Date Fair Value Per Share | 111.71 | $ 109.23 | $ 95.89 |
Converted to common shares, Weighted-Average Grant Date Fair Value Per Share | 76.58 | ||
Forfeited, Weighted-Average Grant Date Fair Value Per Share | 104.24 | ||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | 70.52 | $ 63.61 | |
Vested, Weighted-Average Grant Date Fair Value Per Share | $ 59.22 | ||
Outstanding, Aggregate Intrinsic Value | $ 20,461 | ||
Vested, Aggregate Intrinsic Value | 15,493 | ||
Total intrinsic value of stock-based awards converted into common shares | 2,800 | $ 3,600 | $ 2,800 |
Income tax benefit (expense) from stock-based award | $ 700 | $ 1,300 | $ 1,000 |
Stock-based Compensation (Sch_3
Stock-based Compensation (Schedule Of Market Share Units Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Income tax benefit (expense) from stock-based award | $ 1,100 | $ 1,400 | $ 1,200 | ||
Market Share Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Outstanding, Number of Shares | 44,919 | ||||
Granted, Number of Shares | 15,729 | ||||
Performance factor adjustment, Number of Shares | 12,194 | ||||
Converted to common shares, Number of Shares | (27,589) | ||||
Forfeited, Number of Shares | (3,045) | ||||
Outstanding, Number of Shares | 42,208 | [1] | 44,919 | ||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | $ 94.95 | ||||
Granted, Weighted-Average Grant Date Fair Value Per Share | 101.93 | $ 90.91 | $ 120.99 | ||
Performance factor adjustment, Weighted-Average Grant Date Fair Value Per Share | 76.04 | ||||
Converted to common shares, Weighted-Average Grant Date Fair Value Per Share | 74.30 | ||||
Forfeited, Weighted-Average Grant Date Fair Value Per Share | 91.87 | ||||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | $ 105.81 | [1] | $ 94.95 | ||
Outstanding, Aggregate Intrinsic Value | [1] | $ 7,490 | |||
Expected volatility | 20.40% | 21.10% | 22.20% | ||
Risk-free interest rate | 1.60% | 1.00% | 0.90% | ||
Expected dividend yield | 0.00% | 0.00% | 0.00% | ||
Expected volatility period | 2 years 10 months 21 days | 2 years 10 months 21 days | 2 years 10 months 21 days | ||
Total intrinsic value of stock-based awards converted into common shares | $ 3,000 | $ 2,800 | $ 3,700 | ||
Income tax benefit (expense) from stock-based award | $ 800 | $ 900 | $ 1,200 | ||
Minimum [Member] | Market Share Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percent of original target number of vested shares | 0.00% | ||||
Maximum [Member] | Market Share Units [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percent of original target number of vested shares | 200.00% | ||||
[1] | This figure represents the total number of shares underlying MSU grants assuming achievement of the target number of shares at 100%. As the ultimate number of shares that vest could be as high as 200% of the target, the Company may be required to issue additional shares to satisfy outstanding MSU award grants. |
Stock-based Compensation (Sch_4
Stock-based Compensation (Schedule Of Deferred Performance Share Units) (Details) - Deferred Performance Units [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding, Number of Shares | 30,876 | ||
Granted, Number of Shares | 26,906 | ||
Performance factor adjustment, Number of Shares | (25,882) | ||
Converted to common shares, Number of Shares | (192) | 0 | |
Forfeited, Number of Shares | (940) | ||
Outstanding, Number of Shares | 30,768 | 30,876 | |
Vested, Number of Shares | 4,802 | ||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | $ 107.66 | ||
Granted, Weighted-Average Grant Date Fair Value Per Share | 110.65 | $ 110.19 | $ 94.54 |
Performance factor adjustment, Weighted-Average Grant Date Fair Value Per Share | 110.19 | ||
Converted to common shares, Weighted-Average Grant Date Fair Value Per Share | 94.54 | ||
Forfeited, Weighted-Average Grant Date Fair Value Per Share | 110.65 | ||
Outstanding, Weighted-Average Grant Date Fair Value Per Share | 108.14 | $ 107.66 | |
Vested, Weighted-Average Grant Date Fair Value Per Share | $ 94.54 | ||
Outstanding, Aggregate Intrinsic Value | $ 5,460 | ||
Vested, Aggregate Intrinsic Value | $ 852 | ||
Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percent of original target number of vested shares | 0.00% | ||
Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percent of original target number of vested shares | 100.00% |
Other Benefit Plans (Details)
Other Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, employer matching contribution, percent of match | 50.00% | ||
Defined contribution plan, employer matching contribution, percent of employees' gross pay | 6.60% | ||
Defined contribution plan, maximum annual contributions per employee percent | 10.00% | ||
Discretionary non-elective contribution, percentage | 5.00% | ||
Pension Plan, Defined Benefit [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, cost recognized | $ 3.3 | $ 3.3 | $ 3.2 |
International Pension Plans Defined Benefit [Member] | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, cost recognized | $ 1.6 | $ 1.4 | $ 1.5 |
Business Segments and Foreign_3
Business Segments and Foreign Operations (Summarized Information By Reportable Segments) (Details) $ in Thousands | 12 Months Ended | |||
Aug. 31, 2018USD ($)item | Aug. 31, 2017USD ($) | Aug. 31, 2016USD ($) | ||
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | item | 3 | |||
Net sales | $ 408,518 | $ 380,506 | $ 380,670 | |
Income from operations | 78,604 | 75,909 | 71,348 | |
Depreciation and amortization expense | 7,800 | 6,769 | 6,465 | |
Interest income | 454 | 508 | 683 | |
Interest expense | 4,219 | 2,582 | 1,703 | |
Unallocated Corporate [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | [1] | (25,689) | (24,548) | (23,920) |
Depreciation and amortization expense | [1] | 784 | 155 | 30 |
Americas Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 192,878 | 184,929 | 191,397 | |
Income from operations | 48,954 | 48,303 | 48,404 | |
Depreciation and amortization expense | 4,142 | 4,270 | 4,071 | |
Interest income | 13 | 8 | 5 | |
Interest expense | 4,209 | 2,570 | 1,689 | |
EMEA Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 150,878 | 136,771 | 135,235 | |
Income from operations | 36,241 | 35,389 | 31,702 | |
Depreciation and amortization expense | 2,561 | 2,090 | 2,084 | |
Interest income | 320 | 389 | 485 | |
Asia-Pacific Segment [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 64,762 | 58,806 | 54,038 | |
Income from operations | 19,098 | 16,765 | 15,162 | |
Depreciation and amortization expense | 313 | 254 | 280 | |
Interest income | 121 | 111 | 193 | |
Interest expense | $ 10 | $ 12 | $ 14 | |
[1] | Unallocated corporate expenses are general corporate overhead expenses not directly attributable to any one of the operating segments. These expenses are reported separate from the Company's identified segments and are included in Selling, General and Administrative expenses on the Company's consolidated statements of operations. |
Business Segments And Foreign_4
Business Segments And Foreign Operations (Schedule Of Net Sales By Product Group) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | |
Revenue from External Customer [Line Items] | |||
Net sales | $ 408,518 | $ 380,506 | $ 380,670 |
Maintenance Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Net sales | 372,391 | 342,295 | 339,974 |
Homecare And Cleaning Products [Member] | |||
Revenue from External Customer [Line Items] | |||
Net sales | $ 36,127 | $ 38,211 | $ 40,696 |
Business Segments And Foreign_5
Business Segments And Foreign Operations (Net Sales And Long-Lived Assets By Geographical Area) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 31, 2018 | Aug. 31, 2017 | Aug. 31, 2016 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | $ 408,518 | $ 380,506 | $ 380,670 | |
Long-lived assets | [1] | 36,357 | 29,439 | 11,545 |
United States [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 154,986 | 150,086 | 158,139 | |
Long-lived assets | [1] | 21,986 | 23,346 | 6,419 |
International [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Net sales | 253,532 | 230,420 | 222,531 | |
Long-lived assets | [1] | $ 14,371 | $ 6,093 | $ 5,126 |
[1] | Includes tangible assets and property and equipment, net, attributed to the geographic location in which such assets are located. |
Subsequent Events (Narrative) (
Subsequent Events (Narrative) (Details) - $ / shares | Oct. 09, 2018 | Aug. 31, 2018 |
Subsequent Events [Line Items] | ||
Dividend payable, declared date | Oct. 9, 2018 | |
Dividends payable, date to be paid | Oct. 31, 2018 | |
Dividend payable, record date | Oct. 19, 2018 | |
Subsequent Events [Member] | ||
Subsequent Events [Line Items] | ||
Cash dividend declared | $ 0.54 |