Document_and_Entity_Informatio
Document and Entity Information Document (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 26, 2014 | Jun. 30, 2013 | |
Document Information [Line Items] | ' | ' | ' |
Entity Registrant Name | 'NAUTILUS, INC. | ' | ' |
Entity Central Index Key | '0001078207 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 31,169,656 | ' |
Entity Well-known Seasoned Issuer | 'No | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $270,351,305 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $40,979 | $23,207 |
Trade receivables, net | 25,336 | 21,767 |
Inventories, net | 15,824 | 18,787 |
Prepaids and other current assets | 6,927 | 5,750 |
Income taxes receivable | 80 | 101 |
Short-term notes receivable | 0 | 82 |
Deferred income tax assets | 4,441 | 193 |
Total current assets | 93,587 | 69,887 |
Property, plant and equipment, net | 8,499 | 6,138 |
Goodwill | 2,740 | 2,940 |
Other intangible assets, net | 12,615 | 14,666 |
Long-term deferred income tax assets | 25,725 | 239 |
Other assets | 401 | 441 |
Total assets | 143,567 | 94,311 |
Liabilities and Shareholders' Equity | ' | ' |
Trade payables | 37,192 | 32,753 |
Accrued liabilities | 9,123 | 8,171 |
Warranty obligations, current portion | 1,610 | 2,278 |
Deferred income tax liabilities | 0 | 1,275 |
Total current liabilities | 47,925 | 44,477 |
Warranty obligations, non-current | 28 | 214 |
Income taxes payable, non-current | 2,577 | 2,812 |
Deferred income tax liabilities, non-current | 0 | 1,484 |
Other long-term liabilities | 1,472 | 1,998 |
Total liabilities | 52,002 | 50,985 |
Commitments and contingencies (Note 15) | ' | ' |
Common stock - no par value, 75,000 shares authorized, 31,162 and 30,924 shares issued and outstanding | 6,769 | 6,103 |
Retained earnings | 84,552 | 36,598 |
Accumulated other comprehensive income | 244 | 625 |
Total shareholders' equity | 91,565 | 43,326 |
Total liabilities and shareholders' equity | $143,567 | $94,311 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
Condensed Consolidated Balance Sheet Parenthetical [Abstract] | ' | ' |
Common stock, par value | $0 | $0 |
Common stock, shares authorized | 75,000 | 75,000 |
Common stock, shares issued | 30,924 | 30,747 |
Common stock, shares outstanding | 30,924 | 30,747 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Income Statement [Abstract] | ' | ' | ' | ||
Net sales | $218,803 | $193,926 | $180,412 | ||
Cost of sales | 112,326 | 102,889 | 101,953 | ||
Gross profit | 106,477 | 91,037 | 78,459 | ||
Operating expenses: | ' | ' | ' | ||
Selling and marketing | 66,486 | 58,617 | 54,494 | ||
General and administrative | 18,705 | 17,669 | 17,143 | ||
Research and development | 5,562 | 4,163 | 3,223 | ||
Total operating expenses | 90,753 | 80,449 | 74,860 | ||
Operating income | 15,724 | 10,588 | 3,599 | ||
Other income (expense): | ' | ' | ' | ||
Interest income | 14 | 18 | 65 | ||
Interest expense | -36 | 56 | -466 | ||
Other | 337 | -246 | -11 | ||
Total other income (expense) | 315 | -172 | -412 | ||
Income from continuing operations before income taxes | 16,039 | 10,416 | 3,187 | ||
Income tax provision (benefit) | -32,085 | -226 | 686 | ||
Income from continuing operations | 48,124 | 10,642 | 2,501 | ||
Income (loss) from discontinued operations before income taxes | -559 | 6,007 | -1,065 | ||
Discontinued operations: | ' | ' | ' | ||
Income tax provision (benefit) of discontinued operations | -389 | -234 | 16 | ||
Income (loss) from discontinued operations | -170 | 6,241 | -1,081 | ||
Net income | $47,954 | [1] | $16,883 | [2] | $1,420 |
Basic net income per share | ' | ' | ' | ||
Basic income per share from continuing operations | $1.55 | $0.34 | $0.08 | ||
Basic income (loss) per share from discontinued operations | ($0.01) | $0.21 | ($0.03) | ||
Basic net income per share | $1.54 | $0.55 | $0.05 | ||
Diluted net income per share | ' | ' | ' | ||
Diluted income per share from continuing operations | $1.53 | $0.34 | $0.08 | ||
Diluted income (loss) per share from discontinued operations | ($0.01) | $0.21 | ($0.03) | ||
Diluted net income per share | $1.52 | $0.55 | $0.05 | ||
Shares used in per share calculations: | ' | ' | ' | ||
Basic | 31,072 | 30,851 | 30,746 | ||
Diluted | 31,457 | 30,974 | 30,776 | ||
[1] | Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||
[2] | Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |
Consolidated_Statements_Of_Com
Consolidated Statements Of Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Statement of Other Comprehensive Income [Abstract] | ' | ' | ' | ||
Net income | $47,954 | [1] | $16,883 | [2] | $1,420 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ' | ' | ' | ||
Foreign currency translation, net of income tax (benefit) expense of $20, $(9) and $8 | -381 | -83 | -575 | ||
Comprehensive income | $47,573 | $16,800 | $845 | ||
[1] | Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||
[2] | Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |
Recovered_Sheet1
Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statement of Other Comprehensive Income [Abstract] | ' | ' | ' |
Foreign currency translation tax expense (benefit) | $20 | ($9) | $8 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | |
In Thousands, unless otherwise specified | |||||
Balance at Dec. 31, 2010 | $30,799 | $5,051 | $18,295 | $7,453 | |
Balance, shares at Dec. 31, 2010 | ' | 30,744 | ' | ' | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | |
Net income | 1,420 | ' | 1,420 | ' | |
Foreign currency translation adjustment, including income tax expense (benefit) | -575 | ' | ' | -575 | |
Foreign currency translation tax expense (benefit) | 8 | ' | ' | ' | |
Stock-based compensation expense | 306 | 306 | ' | ' | |
Common stock issued under equity compensation plan, shares | ' | 3 | ' | ' | |
Common stock issued under equity compensation plan | 3 | 3 | ' | ' | |
Balance at Dec. 31, 2011 | 31,953 | 5,360 | 19,715 | 6,878 | |
Balance, shares at Dec. 31, 2011 | ' | 30,747 | ' | ' | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | |
Net income | 16,883 | [1] | ' | 16,883 | ' |
Foreign currency translation adjustment, including income tax expense (benefit) | -83 | ' | ' | -83 | |
Foreign currency translation tax expense (benefit) | -9 | ' | ' | ' | |
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | -6,170 | ' | ' | -6,170 | |
Stock-based compensation expense | 630 | 630 | ' | ' | |
Common stock issued under equity compensation plan, shares | ' | 177 | ' | ' | |
Common stock issued under equity compensation plan | 113 | 113 | ' | ' | |
Balance at Dec. 31, 2012 | 43,326 | 6,103 | 36,598 | 625 | |
Balance, shares at Dec. 31, 2012 | ' | 30,924 | ' | ' | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | |
Net income | 47,954 | [2] | ' | 47,954 | ' |
Foreign currency translation adjustment, including income tax expense (benefit) | -381 | ' | ' | -381 | |
Foreign currency translation tax expense (benefit) | 20 | ' | ' | ' | |
Stock-based compensation expense | 454 | 454 | ' | ' | |
Common stock issued under equity compensation plan, shares | ' | 238 | ' | ' | |
Common stock issued under equity compensation plan | 357 | 357 | ' | ' | |
Tax deficiency related to stock-based awards | -145 | ' | ' | ' | |
Balance at Dec. 31, 2013 | $91,565 | $6,769 | $84,552 | $244 | |
Balance, shares at Dec. 31, 2013 | ' | 31,162 | ' | ' | |
[1] | Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. | ||||
[2] | Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Cash flows from operating activities: | ' | ' | ' | ||
Income from continuing operations | $48,124 | $10,642 | $2,501 | ||
Income (loss) from discontinued operations | -170 | 6,241 | -1,081 | ||
Net income | 47,954 | [1] | 16,883 | [2] | 1,420 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' | ||
Depreciation and amortization | 3,344 | 3,269 | 3,815 | ||
Bad debt expense (reduction) | 588 | -13 | 156 | ||
Inventory lower-of-cost-or-market adjustments | 557 | 402 | 210 | ||
Stock-based compensation expense | 454 | 630 | 306 | ||
(Gain) loss on asset disposals | 2 | -30 | 78 | ||
Reduction of previously estimated asset disposal loss | 0 | 0 | -947 | ||
Deferred income taxes, net of valuation allowances | -32,814 | 145 | 431 | ||
Excess tax deficiency related to stock-based awards | 145 | 0 | 0 | ||
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | 0 | -6,170 | 0 | ||
Changes in operating assets and liabilities: | ' | ' | ' | ||
Trade receivables | -4,417 | 1,928 | -4,580 | ||
Inventories | 2,388 | -7,573 | -1,287 | ||
Prepaids and other current assets | -1,174 | -1,314 | 1,117 | ||
Income taxes receivable | -91 | 464 | -127 | ||
Trade payables | 4,487 | 4,189 | 4,041 | ||
Accrued liabilities, including warranty obligations | -337 | 3 | -35 | ||
Net cash provided by operating activities | 21,086 | 12,813 | 4,598 | ||
Cash flows from investing activities: | ' | ' | ' | ||
Proceeds from sale of discontinued operations | 116 | 410 | 1,303 | ||
Proceeds from other asset sales | 5 | 6 | 0 | ||
Purchases of software and equipment | -3,590 | -2,442 | -2,506 | ||
Net decrease in restricted cash | 0 | 0 | 351 | ||
Net cash used in investing activities | -3,469 | -2,026 | -852 | ||
Cash flows from financing activities: | ' | ' | ' | ||
Repayment of long-term borrowings | 0 | -5,000 | 0 | ||
Financing costs | 0 | 0 | -35 | ||
Proceeds from exercise of stock options | 357 | 113 | 3 | ||
Excess tax expense related to stock-based awards | -145 | 0 | 0 | ||
Net cash provided by (used in) financing activities | 212 | -4,887 | -32 | ||
Effect of exchange rate changes on cash and cash equivalents | -57 | -120 | -583 | ||
Increase in cash and cash equivalents | 17,772 | 5,780 | 3,131 | ||
Cash and cash equivalents, beginning of year | 23,207 | 17,427 | 14,296 | ||
Cash and cash equivalents, end of year | 40,979 | 23,207 | 17,427 | ||
Supplemental disclosure of cash flow information: | ' | ' | ' | ||
Cash (paid) refunded for income taxes, net | -450 | -277 | 22 | ||
Cash paid for interest | ($36) | ($544) | $0 | ||
[1] | Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||
[2] | Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Accounting Policies [Abstract] | ' | |||||||||||
Significant Accounting Policies | ' | |||||||||||
SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||
Organization and Business | ||||||||||||
Nautilus was founded in 1986 and incorporated in the State of Washington in 1993. Our headquarters are located in Vancouver, Washington. | ||||||||||||
We are committed to providing innovative, quality solutions to help people achieve a fit and healthy lifestyle. Our principal business activities include designing, developing, sourcing and marketing high-quality cardio and strength fitness products and related accessories for consumer use, primarily in the United States and Canada. Our products are sold under some of the most-recognized brand names in the fitness industry: Nautilus®, Bowflex®, Schwinn®, Schwinn Fitness™ and Universal®. | ||||||||||||
We market our products through two distinct distribution channels, Direct and Retail, which we consider to be separate business segments. Our Direct business offers products directly to consumers through television advertising, catalogs and the Internet. Our Retail business offers our products through a network of independent retail companies with stores and websites located in the United States and internationally. We also derive a portion of our revenue from the licensing of our brands and intellectual property. | ||||||||||||
Basis of Presentation | ||||||||||||
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and relate to Nautilus, Inc. and its subsidiaries, all of which are wholly-owned, directly or indirectly. Intercompany transactions and balances have been eliminated in consolidation. | ||||||||||||
Discontinued Operations | ||||||||||||
Results from discontinued operations relate to the disposal of our former Commercial business, which began in 2009 and was completed in April 2011. We reached substantial completion of asset liquidation at December 31, 2012. However, we continue to have legal and accounting expenses as we work with authorities on final deregistration of each entity and product liability expenses associated with product previously sold into the Commercial channel. | ||||||||||||
Results of operations and certain assets associated with the commercial business have been presented in the consolidated financial statements as discontinued operations for all periods presented. | ||||||||||||
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 in the financial statements. Our most significant estimates relate to the following: | ||||||||||||
• | Revenue recognition; | |||||||||||
• | Sales discounts and allowances; | |||||||||||
• | Goodwill and other long-term asset valuation; | |||||||||||
• | Product warranty obligations; | |||||||||||
• | Valuation of excess and obsolete inventory; | |||||||||||
• | Litigation and loss contingencies; | |||||||||||
• | Deferred tax assets and the related valuation allowance; and | |||||||||||
• | Unrecognized tax benefits. | |||||||||||
Actual results could differ from our estimates. | ||||||||||||
Concentrations | ||||||||||||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash held in bank accounts in excess of federally-insured limits and trade receivables. Trade receivables are generally unsecured and therefore collection is affected by the economic conditions in each of our principal markets. | ||||||||||||
We rely on third-party contract manufacturers in Asia for substantially all of our products and for certain product engineering support. Business operations could be disrupted by natural disasters, difficulties in transporting products from non-U.S. suppliers, as well as political, social or economic instability in the countries where contract manufacturers or their vendors or customers conduct business. While any such contract manufacturing arrangement could be replaced over time, the temporary loss of the services of any primary contract manufacturer could delay product shipments and cause a significant disruption in our operations. | ||||||||||||
We derive a significant portion of our Net Sales from a small number of our Retail customers. A loss of business from one or more of these large customers, if not replaced with new business, would negatively affect our operating results and cash flows. In 2013, 2012 and 2011, one customer accounted for more than 10%, but less than 15%, of our Net Sales. | ||||||||||||
Cash and Cash Equivalents | ||||||||||||
All highly liquid investments with maturities of three months or less at purchase are considered to be cash equivalents. As of December 31, 2013 and 2012, cash and cash equivalents consisted entirely of cash. | ||||||||||||
Inventories | ||||||||||||
Inventories are stated at the lower of cost or market, with cost determined based on the first-in, first-out method. We establish inventory allowances for excess, slow-moving and obsolete inventory based on inventory levels, expected product life and forecasted sales. Inventories are written down to market value based on historical demand, competitive factors, changes in technology and product lifecycles. | ||||||||||||
Property, Plant and Equipment | ||||||||||||
Property, plant and equipment is stated at cost, net of accumulated depreciation. Improvements or betterments which add new functionality or significantly extend the life of an asset are capitalized. Expenditures for maintenance and repairs are expensed as incurred. The cost of assets retired, or otherwise disposed of, and the related accumulated depreciation, are removed from the accounts at the time of disposal. Gains and losses resulting from asset sales and dispositions are recognized in the period in which assets are disposed. Depreciation is recognized, using the straight-line method, over the lesser of the estimated useful lives of the assets or, in the case of leasehold improvements, the lease term, including renewal periods if we expect to exercise our renewal options. Depreciation on computer equipment, machinery and equipment and furniture and fixtures is determined based on estimated useful lives, which generally range from three-to-five years. | ||||||||||||
Goodwill | ||||||||||||
Goodwill consists of the excess of acquisition costs over the fair values of net assets acquired in business combinations. We review goodwill for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the carrying amount may be impaired. For this purpose, goodwill is evaluated at the reporting unit level. Our goodwill is an asset of our Direct reporting unit. We performed a qualitative assessment of goodwill in the fourth quarters of 2013, 2012 and 2011 and concluded that circumstances did not more likely than not indicate an impairment had occurred. For further information regarding goodwill, see Note 6, Goodwill. | ||||||||||||
Historically, our policy was to perform the annual impairment test for goodwill at October 31 of each year, or more frequently if impairment indicators arose. During the fourth quarter of 2013, we changed the date of our annual goodwill impairment test to October 1 to better align with our annual and long-term planning and budgeting process. Accordingly, we believe this change in accounting principle is preferable. The change did not delay, accelerate, or avoid an impairment charge. This change in the annual goodwill impairment testing date was applied prospectively beginning on October 1, 2013 as we determined that it was impracticable to objectively determine projected cash flows and related valuation estimates that would have been used as of each October 1 of prior reporting periods without the use of hindsight. | ||||||||||||
Other Intangible Assets | ||||||||||||
Finite-lived intangible assets, primarily acquired patents and patent rights, are stated at cost, net of accumulated amortization. We recognize amortization expense for our finite-lived intangible assets on a straight-line basis over the estimated useful lives. | ||||||||||||
Indefinite-lived intangible assets consist of acquired trademarks. Indefinite-lived intangible assets are stated at cost and are not amortized; instead, they are tested for impairment at least annually. We review our acquired trademarks for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the assets may be impaired. The fair value of trademarks is estimated using the relief from royalty approach, a standard form of discounted cash flow analysis used in the valuation of trademarks. If the carrying amount of trademarks exceeds the estimated fair value, we calculate impairment as the excess of carrying amount over the estimate of fair value. We tested our acquired trademarks for impairment in the fourth quarters of 2013, 2012 and 2011 and determined that no impairment was indicated. For further information regarding other intangible assets, see Note 7, Other Intangible Assets. | ||||||||||||
Impairment of Long-Lived Assets | ||||||||||||
Long-lived assets, including property, plant and equipment and finite-lived intangible assets, are evaluated for impairment when events or circumstances indicate the carrying value may be impaired. When such an event or condition occurs, we estimates the future undiscounted cash flows to be derived from the use and eventual disposition of the asset to determine whether a potential impairment exists. If the carrying value exceeds estimated future undiscounted cash flows, we record impairment expense to reduce the carrying value of the asset to its estimated fair value. No impairment charges were recorded in 2013, 2012 or 2011. | ||||||||||||
Revenue Recognition | ||||||||||||
Direct and Retail product sales and shipping revenues are recorded when products are shipped and title passes to customers. In most instances, Retail sales to customers are made pursuant to a sales contract that provides for transfer of both title and risk of loss to the customer upon our delivery to the carrier. For Direct sales, revenue is generally recognized when products are shipped. Revenue is recognized net of applicable sales incentives, such as promotional discounts, rebates and return allowances. We estimate the revenue impact of incentive programs based on the planned duration of the program and historical experience. | ||||||||||||
Many Direct business customers finance their purchases through a third-party credit provider, for which we pay a commission or financing fee to the credit provider. Revenue for such transactions is recognized based on the sales price charged to the customer and the related commission or financing fee is included in Selling and Marketing expense. | ||||||||||||
Sales Discounts and Returns Allowance | ||||||||||||
Product sales and shipping revenues are reported net of promotional discounts and return allowances. We estimate the revenue impact of retail sales incentive programs based on the planned duration of the program and historical experience. If the amount of sales incentives is reasonably estimable, the impact of such incentives is recorded at the later of the time the customer is notified of the sales incentive or the time of the sale. We estimate our liability for product returns based on historical experience and record the expected obligation as a reduction of revenue. If actual return costs differ from previous estimates, the amount of the liability and corresponding revenue are adjusted in the period in which such costs occur. Activity in our sales discounts and returns allowance was as follows (in thousands): | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 4,990 | $ | 5,113 | $ | 4,695 | ||||||
Charges to reserve | 13,345 | 11,730 | 10,735 | |||||||||
Reductions for sales discounts and returns | (14,229 | ) | (11,853 | ) | (10,317 | ) | ||||||
Balance, December 31 | $ | 4,106 | $ | 4,990 | $ | 5,113 | ||||||
Taxes Collected from Customers and Remitted to Governmental Authorities | ||||||||||||
Taxes collected from customers and remitted to governmental authorities are recorded on a net basis and excluded from revenue. | ||||||||||||
Shipping and Handling Fees | ||||||||||||
Shipping and handling fees billed to customers are recorded gross and included in both revenue and cost of sales. | ||||||||||||
Cost of Sales | ||||||||||||
Cost of Sales primarily consists of: inventory costs; royalties paid to third parties; employment and occupancy costs of warehouse and distribution facilities, including depreciation of improvements and equipment; transportation expenses; product warranty expenses; distribution information systems expenses; and allocated expenses for shared administrative functions. | ||||||||||||
Product Warranty Obligations | ||||||||||||
Our products carry limited, defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from sixty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in Cost of Sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product Warranty Obligations is adjusted accordingly. | ||||||||||||
Litigation and Loss Contingencies | ||||||||||||
From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We record expenses for litigation and loss contingencies as a component of General and Administrative expense when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When a loss contingency is not both probable and estimable, we do not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose an estimate of the possible loss or range of loss, if such estimate can be made, or disclose that an estimate cannot be made. | ||||||||||||
Advertising and Promotion | ||||||||||||
We expense our advertising and promotion costs as incurred. Production costs of television advertising commercials are recorded as prepaid expenses until the initial broadcast, at which time such costs are expensed. Advertising and promotion costs are included in Selling and Marketing expenses. Total advertising and promotion expenses were $35.8 million, $30.9 million and $28.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. Prepaid advertising and promotion costs were $2.2 million and $1.3 million as of December 31, 2013 and 2012, respectively. | ||||||||||||
Research and Development | ||||||||||||
Internal research and development costs, which primarily consist of salaries and wages, employee benefits, expenditures for materials, and fees to use licensed technologies, are expensed as incurred. Third party research and development costs for products under development or being researched, if any, are expensed as the contracted work is performed. | ||||||||||||
Income Taxes | ||||||||||||
We account for income taxes based on the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to be in effect when the temporary differences are expected to be included, as income or expense, in the applicable tax return. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the enactment. Valuation allowances are provided against deferred income tax assets if we determine it is more likely than not that such assets will not be realized. | ||||||||||||
Unrecognized Tax Benefits | ||||||||||||
We recognize a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained based on the technical merits of the position upon examination, including resolutions of any related appeals or litigation. | ||||||||||||
Foreign Currency Translation | ||||||||||||
We translate the accounts of our non-U.S. subsidiaries into U.S. dollars as follows: revenues, expenses, gains and losses are translated at weighted-average exchange rates during the year; and assets and liabilities are translated at the exchange rate on the balance sheet date. Translation gains and losses are reported in our Consolidated Balance Sheets as a component of Accumulated Other Comprehensive Income. In the fourth quarter of 2012, we substantially completed the liquidation of our investment in foreign subsidiaries formerly associated with the Commercial business. As a result, an accumulated translation adjustment of $6.2 million was removed from accumulated other comprehensive income and recognized as a gain of the discontinued operations. | ||||||||||||
Gains and losses arising from foreign currency transactions, including transactions between us and our non-U.S. subsidiaries, are recorded as a component of other income (expense) in our Consolidated Statements of Operations. | ||||||||||||
Fair Value of Financial Instruments | ||||||||||||
The carrying values of Cash and Cash Equivalents, Trade Receivables, Prepaid and Other Current Assets, Short-Term Notes Receivable, Trade Payables and Accrued Liabilities approximate fair value due to their short maturities. | ||||||||||||
We did not have any financial instruments that were recorded at fair value on a recurring basis at December 31, 2013 or 2012. | ||||||||||||
Stock-Based Compensation | ||||||||||||
We recognize stock-based compensation expense on a straight-line basis over the applicable vesting period, based on the grant-date fair value of the award. To the extent a stock-based award is subject to performance conditions, the amount of expense recorded in a given period, if any, reflects our assessment of the probability of achieving the performance targets. | ||||||||||||
Fair value of stock options is estimated using the Black-Scholes-Merton option valuation model; fair value of performance share unit awards is estimated using the binomial valuation model; fair value of restricted stock unit awards is based on the closing market price on the day preceding the grant. | ||||||||||||
Net Income Per Share | ||||||||||||
Basic per share amounts were computed using the weighted average number of common shares outstanding. Diluted per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. | ||||||||||||
Related Party Transactions | ||||||||||||
In September 2010, we entered into an agreement to borrow $5.0 million from certain entities under common control of Sherborne Investors GP, LLC and its affiliates (collectively “Sherborne”). At the time, Sherborne was our largest shareholder and was controlled by Edward J. Bramson, our former Chairman and Chief Executive Officer, and Craig L. McKibben, a former member of our Board of Directors. We incurred interest expense of $0.4 million and $0.1 million with respect to such debt in 2011 and 2010, respectively. We repaid all amounts outstanding with respect to such debt in March 2012 and, accordingly, both the outstanding principal balance and amount of accrued interest expense as of December 31, 2013 and 2012 were zero. | ||||||||||||
New Accounting Pronouncements | ||||||||||||
ASU 2013-02 | ||||||||||||
In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” Under ASU 2013-02, an entity is required to provide information about the amounts reclassified out of Accumulated Other Comprehensive Income (“AOCI”) by component. In addition, an entity is required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. The adoption of ASU 2013-02 in January 2013 did not have any impact on our financial position, results of operations or cash flows. | ||||||||||||
ASU 2013-11 | ||||||||||||
In July 2013, the FASB issued ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” ASU 2013-11 amends the guidance related to the presentation of unrecognized tax benefits and allows for the reduction of a deferred tax asset for a net operating loss (“NOL”) carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. ASU 2013-11 is effective for annual and interim periods for fiscal years beginning after December 15, 2013, and early adoption is permitted. Since ASU 2013-11 relates only to the presentation of unrecognized tax benefits, we do not expect our adoption of ASU 2013-11 in January 2014 will have a material effect on our financial position, results of operations or cash flows. |
Discontinued_Operation
Discontinued Operation | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||||
Discontinued Operation | ' | |||||||||||
DISCONTINUED OPERATIONS | ||||||||||||
On September 25, 2009, in light of continuing operating losses in our Commercial business and in order to focus exclusively on managing our Direct and Retail businesses, we committed to a plan for the complete divestiture of our Commercial business, which qualified for held-for-sale accounting treatment. The Commercial business is presented as Discontinued Operations in our Condensed Consolidated Statements of Operations for all periods. | ||||||||||||
The disposal of the Commercial business assets was completed in April 2011. We reached substantial completion of asset liquidation at December 2012. However, we continue to have legal and accounting expenses as we work with authorities on final deregistration of certain European entities and product liability expenses associated with product previously sold into the Commercial channel. There was no revenue related to the Commercial business for the years ended December 31, 2013 or 2012. | ||||||||||||
Following is a summary of certain financial information regarding the Commercial business (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Revenue | $ | — | $ | — | $ | 86 | ||||||
Loss from discontinued operations | $ | (559 | ) | $ | (163 | ) | $ | (2,291 | ) | |||
Gain on disposal activities | — | — | 280 | |||||||||
(559 | ) | (163 | ) | (2,011 | ) | |||||||
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | — | 6,170 | — | |||||||||
Reduction of previously-estimated disposal loss | — | — | 946 | |||||||||
Income tax benefit (expense) | 389 | 234 | (16 | ) | ||||||||
Total income (loss) from discontinued operations | $ | (170 | ) | $ | 6,241 | $ | (1,081 | ) | ||||
The following table summarizes liabilities for exit costs related to discontinued operations, included in Accrued Liabilities and Other Long-Term Liabilities in our Condensed Consolidated Balance Sheets (in thousands): | ||||||||||||
Facilities | Severance and Benefits | |||||||||||
Leases | ||||||||||||
Balance as of January 1, 2011 | $ | 2,160 | $ | 476 | ||||||||
Adjustments | 217 | 175 | ||||||||||
Payments | (448 | ) | (476 | ) | ||||||||
Balance as of December 31, 2011 | 1,929 | 175 | ||||||||||
Adjustments | (390 | ) | — | |||||||||
Payments | (421 | ) | (175 | ) | ||||||||
Balance as of December 31, 2012 | 1,118 | — | ||||||||||
Payments | (287 | ) | — | |||||||||
Balance as of December 31, 2013 | $ | 831 | $ | — | ||||||||
We expect the lease obligations to be paid out through 2016. |
Trade_Receivables
Trade Receivables | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Receivables [Abstract] | ' | |||||||||||
Trade Receivables | ' | |||||||||||
TRADE RECEIVABLES | ||||||||||||
Changes in our allowance for doubtful trade receivables were as follows (in thousands): | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 93 | $ | 300 | $ | 301 | ||||||
Charges to (reversals of) bad debt expense | 588 | (13 | ) | 156 | ||||||||
Writeoffs, net of recoveries | (628 | ) | (194 | ) | (157 | ) | ||||||
Balance, December 31 | $ | 53 | $ | 93 | $ | 300 | ||||||
Inventories
Inventories | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
INVENTORIES | ||||||||
Inventories, net, consisted of the following (in thousands): | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Finished goods | $ | 14,259 | $ | 17,148 | ||||
Parts and components | 1,565 | 1,639 | ||||||
$ | 15,824 | $ | 18,787 | |||||
Property_Plant_and_Equipment
Property, Plant and Equipment | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||||
Property, Plant and Equipment | ' | |||||||||||
PROPERTY, PLANT AND EQUIPMENT | ||||||||||||
Property, plant and equipment consisted of the following (in thousands): | ||||||||||||
Estimated | December 31, | |||||||||||
Useful Life | ||||||||||||
(in years) | 2013 | 2012 | ||||||||||
Leasehold improvements | 5 to 20 | $ | 2,869 | $ | 2,863 | |||||||
Computer equipment | 3 to 5 | 35,554 | 36,107 | |||||||||
Machinery and equipment | 3 to 5 | 5,648 | 5,359 | |||||||||
Furniture and fixtures | 5 | 688 | 870 | |||||||||
Work in progress 1 | N/A | 4,281 | 2,080 | |||||||||
Total cost | 49,040 | 47,279 | ||||||||||
Accumulated depreciation | (40,541 | ) | (41,141 | ) | ||||||||
$ | 8,499 | $ | 6,138 | |||||||||
1 Work in progress includes internal use software development and production tooling construction in progress. | ||||||||||||
Depreciation expense was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Depreciation expense | $ | 1,254 | $ | 1,199 | $ | 1,644 | ||||||
Goodwill
Goodwill | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||
Goodwill | ' | |||
GOODWILL | ||||
All goodwill is assigned to our Direct reporting unit. The rollforward of Goodwill was as follows (in thousands): | ||||
Balance, December 31, 2010 | $ | 2,931 | ||
Currency exchange rate adjustment | (58 | ) | ||
Balance, December 31, 2011 | 2,873 | |||
Currency exchange rate adjustment | 67 | |||
Balance, December 31, 2012 | 2,940 | |||
Currency exchange rate adjustment | (200 | ) | ||
Balance, December 31, 2013 | $ | 2,740 | ||
Other_Intangible_Assets
Other Intangible Assets | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||
Other Intangible Assets | ' | |||||||||||
OTHER INTANGIBLE ASSETS | ||||||||||||
Intangible assets consisted of the following (in thousands): | ||||||||||||
Estimated | December 31, | |||||||||||
Useful Life | ||||||||||||
(in years) | 2013 | 2012 | ||||||||||
Indefinite life trademarks | N/A | $ | 9,052 | $ | 9,052 | |||||||
Patents | 8 | to | 16 | 18,154 | 18,154 | |||||||
27,206 | 27,206 | |||||||||||
Accumulated amortization - patents | (14,591 | ) | (12,540 | ) | ||||||||
$ | 12,615 | $ | 14,666 | |||||||||
Amortization expense was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Amortization expense | $ | 2,050 | $ | 2,050 | $ | 2,058 | ||||||
Future amortization of patents is as follows (in thousands): | ||||||||||||
2014 | $ | 2,040 | ||||||||||
2015 | 828 | |||||||||||
2016 | 430 | |||||||||||
2017 | 143 | |||||||||||
2018 | 65 | |||||||||||
Thereafter | 57 | |||||||||||
$ | 3,563 | |||||||||||
Accrued_Liabilities
Accrued Liabilities | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Accrued Liabilities [Abstract] | ' | |||||||
Accrued Liabilities | ' | |||||||
ACCRUED LIABILITIES | ||||||||
Accrued liabilities consisted of the following (in thousands): | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Payroll and related liabilities | $ | 4,244 | $ | 3,327 | ||||
Other | 4,879 | 4,844 | ||||||
$ | 9,123 | $ | 8,171 | |||||
Product_Warranties
Product Warranties | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Product Warranties Disclosures [Abstract] | ' | |||||||||||
Product Warranties | ' | |||||||||||
PRODUCT WARRANTIES | ||||||||||||
Changes in our product warranty obligations were as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 2,492 | $ | 2,017 | $ | 3,935 | ||||||
Accruals | 1,097 | 2,615 | 1,789 | |||||||||
Adjustments | (186 | ) | (170 | ) | (660 | ) | ||||||
Payments | (1,765 | ) | (1,970 | ) | (3,047 | ) | ||||||
Balance, December 31 | $ | 1,638 | $ | 2,492 | $ | 2,017 | ||||||
Product warranty payments in 2011 primarily related to retained obligations of our former Commercial business. Product warranty liability adjustments in 2011 primarily related to the assignment of certain outstanding Commercial warranty obligations to the buyer of certain components of the Commercial business. |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2013 | |
Debt Disclosure [Abstract] | ' |
Borrowings | ' |
BORROWINGS | |
Line of Credit | |
We have a Credit Agreement (the "Loan Agreement") with Bank of the West that provides for a $15,750,000 maximum revolving secured credit line. The line of credit is available through March 31, 2015 for working capital, standby letters of credit and general corporate purposes. Borrowing availability under the Loan Agreement is subject to our compliance with certain financial and operating covenants at the time borrowings are requested. Standby letters of credit under the Loan Agreement are treated as a reduction of the available borrowing amount and are subject to covenant testing. | |
The interest rate applicable to borrowings under the Loan Agreement is based on either, at our discretion, Bank of the West's base rate, a floating rate or LIBOR, plus an applicable margin based on certain financial performance metrics. Our borrowing rate was 1.67% as of December 31, 2013. The Loan Agreement contains customary covenants, including minimum fixed charge coverage ratio and leverage ratio, and limitations on capital expenditures, mergers and acquisitions, indebtedness, liens, dispositions, dividends and investments. The Loan Agreement also contains customary events of default. Upon an event of default, the lender has the option of terminating its credit commitment and accelerating all obligations under the Loan Agreement. Borrowings under the Loan Agreement are collateralized by substantially all of our assets, including intellectual property assets. | |
As of December 31, 2013, we had no outstanding borrowings and $0.5 million in standby letters of credit issued under the Loan Agreement. As of December 31, 2013, we were in compliance with the financial covenants of the Loan Agreement and approximately $15.3 million was available for borrowing. | |
Sherborne Note Payable | |
On September 3, 2010, we entered into a Note Purchase Agreement (the “Purchase Agreement”) with certain entities (collectively, the “Sherborne Purchasers”) under common control of Sherborne Investors GP, LLC and its affiliates (collectively “Sherborne”). Sherborne was formerly our largest shareholder and is controlled by Edward J. Bramson, our former Chairman and Chief Executive Officer, and Craig L. McKibben, a former member of our Board of Directors. | |
Pursuant to the Purchase Agreement, we issued to the Sherborne Purchasers $6.1 million in aggregate principal amount at maturity of Increasing Rate Senior Discount Notes (the “Notes”). The Notes had an original principal amount totaling $5.0 million and an original maturity date of December 31, 2012. On March 12, 2012, the maturity date of the Notes was automatically extended under certain terms of the Purchase Agreement to May 2, 2013. | |
On July 19, 2011, beneficial interest in the Notes was assigned by the Sherborne Purchasers pro-rata to their respective investors in the manner permitted by the Purchase Agreement. Such assignment was made in connection with the resignation of Messrs. Bramson and McKibben from their respective positions with Nautilus on May 26, 2011, and the subsequent pro-rata distribution by certain Sherborne-affiliated entities to their respective investors of our common stock owned by such entities. | |
We repaid all amounts outstanding under the Notes on March 30, 2012. If all of the Notes were paid on the original maturity date, the effective rate of interest over the term of the Purchase Agreement would have been approximately 8.7% per annum, which was the rate at which interest expense was accrued in periods preceding the repayment date. The actual effective rate of interest through the repayment date was approximately 6.4% per annum. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Taxes | ' | |||||||||||
INCOME TAXES | ||||||||||||
Income Tax Provision | ||||||||||||
Income from continuing operations before income taxes was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
United States | $ | 15,386 | $ | 10,025 | $ | 2,876 | ||||||
Non-U.S. | 653 | 391 | 311 | |||||||||
$ | 16,039 | $ | 10,416 | $ | 3,187 | |||||||
Income tax (benefit) expense from continuing operations was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Current: | ||||||||||||
U.S. federal | $ | 541 | $ | (579 | ) | $ | 172 | |||||
U.S. state | 56 | 53 | 26 | |||||||||
Non-U.S. | (12 | ) | 155 | 77 | ||||||||
Total current | 585 | (371 | ) | 275 | ||||||||
Deferred: | ||||||||||||
U.S. federal | (29,552 | ) | 177 | 314 | ||||||||
U.S. state | (3,370 | ) | 17 | 27 | ||||||||
Non-U.S. | 252 | (49 | ) | 70 | ||||||||
Total deferred | (32,670 | ) | 145 | 411 | ||||||||
$ | (32,085 | ) | $ | (226 | ) | $ | 686 | |||||
Following is a reconciliation of the U.S. statutory federal income tax rate with our effective income tax rate for continuing operations: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
U.S. statutory income tax rate | 35 | % | 35 | % | 35 | % | ||||||
State tax, net of U.S. federal tax benefit | 2.9 | 1.1 | 5.2 | |||||||||
Non-U.S. income taxes | 1.2 | — | 2.1 | |||||||||
Nondeductible operating expenses | (0.4 | ) | 0.4 | (1.8 | ) | |||||||
Research and development credit | (0.7 | ) | — | (2.6 | ) | |||||||
Change in deferred tax measurement rate | 0.2 | 0.1 | (0.3 | ) | ||||||||
Change in uncertain tax positions | 2.2 | (6.5 | ) | 13 | ||||||||
Expiration of capital loss carryforward | 26.9 | — | — | |||||||||
Change in valuation allowance | (267.6 | ) | (32.3 | ) | (29.0 | ) | ||||||
Other | 0.2 | — | (0.1 | ) | ||||||||
Effective income tax rate | (200.1 | )% | (2.2 | )% | 21.5 | % | ||||||
Deferred Income Taxes | ||||||||||||
Individually significant components of Deferred Income Tax Assets (Liabilities) were as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred Income Tax Assets: | ||||||||||||
Accrued liabilities | $ | 3,230 | $ | 3,312 | ||||||||
Allowance for doubtful accounts | 20 | 21 | ||||||||||
Inventory valuation | 312 | 382 | ||||||||||
Capitalized indirect inventory costs | 159 | 207 | ||||||||||
Stock-based compensation expense | 376 | 612 | ||||||||||
Net operating loss carryforward | 35,635 | 40,540 | ||||||||||
Capital loss carryforward | — | 4,319 | ||||||||||
Basis difference on long-lived assets | 4,412 | 5,783 | ||||||||||
Credit carryforward | 3,422 | 3,088 | ||||||||||
Other | 332 | 473 | ||||||||||
Gross Deferred Income Tax Assets | 47,898 | 58,737 | ||||||||||
Valuation allowance | (12,944 | ) | (57,230 | ) | ||||||||
Deferred Income Tax Assets, net of valuation allowance | 34,954 | 1,507 | ||||||||||
Deferred Income Tax Liabilities: | ||||||||||||
Prepaid advertising | (793 | ) | (381 | ) | ||||||||
Other prepaids | (592 | ) | (320 | ) | ||||||||
Basis difference on long-lived assets | (2,938 | ) | (2,678 | ) | ||||||||
Undistributed earnings of foreign subsidiaries | (177 | ) | (136 | ) | ||||||||
Other | (288 | ) | (319 | ) | ||||||||
Deferred Income Tax Liabilities | (4,788 | ) | (3,834 | ) | ||||||||
Net Deferred Income Tax Asset (Liability) | $ | 30,166 | $ | (2,327 | ) | |||||||
Our Net Deferred Income Tax Asset (Liability) was recorded on our Consolidated Balance Sheets as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Current Deferred Income Tax Assets | $ | 4,441 | $ | 193 | ||||||||
Current Deferred Income Tax Liabilities | — | (1,275 | ) | |||||||||
Long-Term Deferred Income Tax Assets | 25,725 | 239 | ||||||||||
Non-Current Deferred Income Tax Liabilities | — | (1,484 | ) | |||||||||
Net Deferred Income Tax Asset (Liability) | $ | 30,166 | $ | (2,327 | ) | |||||||
As a result of certain realization requirements of ASC 718, the table of deferred tax assets and liabilities shown above does not include certain deferred tax assets as of December 31, 2013, and December 31, 2012, that arose directly from tax deductions related to equity compensation greater than compensation recognized for financial reporting. Equity will be increased by $0.3 million if and when such deferred tax assets are ultimately realized. We use tax law ordering when determining when excess tax benefits have been realized. | ||||||||||||
In the second quarter of 2013, we evaluated the potential realization of our Deferred Income Tax Assets, considering both positive and negative evidence, including cumulative income or loss for the past three years and forecasted taxable income. As a result of this evaluation we concluded that, as of June 30, 2013, a majority of the existing valuation allowance on our domestic Deferred Income Tax Assets was no longer required. As of December 31, 2013, we maintain the same position as the previous quarter that the partial release of valuation allowance is still appropriate. Accordingly, an income tax benefit of $38.9 million was recorded during 2013 related to the reduction of our existing valuation allowance. | ||||||||||||
Further there was a total of $4.4 million of Deferred Income Tax Asset reversal related to the expiration of capital loss and certain state net operating loss carryforwards during the fourth quarter of 2013. Accordingly a corresponding amount of valuation allowance was reversed in the same quarter. | ||||||||||||
Evaluating the need for, and amount of, a valuation allowance for deferred tax assets often requires significant judgment and extensive analysis of all available evidence on a jurisdiction-by-jurisdiction basis. Such judgments require us to interpret existing tax law and other published guidance as applied to our circumstances. As part of this assessment, we consider both positive and negative evidence. The weight given to the potential effect of positive and negative evidence must be commensurate with the extent to which the strength of the evidence can be objectively verified. We generally consider the following, but are not limited to, objectively verified evidence to determine the likelihood of realization of the deferred tax assets: | ||||||||||||
• | Our current financial position and our historical results of operations for recent years. We generally consider cumulative pre-tax losses in the three-year period ending with the current quarter to be significant negative evidence regarding our future profitability. A pattern of objectively-measured recent financial reporting losses is heavily weighted as a source of negative evidence. Further, we also consider the historical and current financial trends in the recent years. | |||||||||||
• | Sources of taxable income of the appropriate character. Future realization of deferred tax assets is dependent on projected taxable income of the appropriate character from our continuing operations. Future reversals of existing temporary differences are heavily-weighted sources of objectively verifiable positive evidence. Projections of future taxable income exclusive of reversing temporary differences are a source of positive evidence only when the projections are combined with a history of recent profits and current financial trends and can be reasonably estimated. | |||||||||||
• | Carryback and carryforward periods available. The long carryback and carryforward periods permitted under the tax law are objectively verified positive evidence. | |||||||||||
• | Tax planning strategies. Tax planning strategies can be, depending on their nature, heavily-weighted sources of objectively verifiable positive evidence when the strategies are available and can be reasonably executed. We consider tax planning strategies only if they are feasible and justifiable considering our current operations and our strategic plan. Tax planning strategies, if executed, may accelerate the recovery of a deferred tax asset so the tax benefit of the deferred tax asset can be carried back. | |||||||||||
During 2008, we determined that it was no longer more likely than not that the tax benefits from the existing U.S. deferred tax assets would be realized due to the substantial amount of the cumulative accounting losses realized in the recent years in the U.S. and the large taxable losses incurred in the U.S. in 2007 and 2008. Accordingly, we established a full valuation allowance against our U.S. net deferred tax assets in 2008. | ||||||||||||
Each quarter, we assess the total weight of positive and negative evidence and re-evaluate whether any adjustments or release of all or any portion of valuation allowance is appropriate. In our assessment during the second quarter of 2013, we heavily weighted the positive evidence of 1) cumulative profits realized in recent years combined with the upward financial trends of current periods; and 2) future realization of the existing U.S. deferred tax assets. Given our recent improved financial performance along with the sustained cumulative accounting profit, we projected a positive forecasted taxable income in the U.S. during the second quarter of 2013. Accordingly, based on our review of the objective evidence and our detailed analysis during the second quarter of 2013, we determined that a portion of our U.S. domestic valuation allowance was no longer required. | ||||||||||||
Of the remaining valuation allowance, $4.1 million relates to certain domestic loss and other credit carryforwards that we may not be able to utilize primarily due to their shorter remaining carryforward periods and $8.8 million relates to foreign net operating loss carryfowards. Should it be determined in the future that it is more likely than not that our domestic Deferred Income Tax Assets will be realized, an additional valuation allowance would be released during the period in which such an assessment is made. There have been no material changes to our foreign operations since December 31, 2012 and, accordingly, we maintain our existing valuation allowance on foreign Deferred Income Tax Assets in such jurisdictions at December 31, 2013. | ||||||||||||
Income Tax Carryforwards | ||||||||||||
As of December 31, 2013, we had the following income tax carryforwards (in millions): | ||||||||||||
Amount | Expires in | |||||||||||
Net operating loss carryforwards: | ||||||||||||
U.S. Federal | $ | 64.4 | 2029 - 2031 | |||||||||
U.S. State | 98.3 | 2014 - 2031 | ||||||||||
Germany | 11.2 | Indefinite | ||||||||||
Switzerland | 20.4 | 2014 - 2020 | ||||||||||
China | 3.8 | 2014 - 2016 | ||||||||||
Italy | 2.6 | 2014 - 2017 | ||||||||||
Income tax credit carryforwards: | ||||||||||||
U.S. Federal | 2.9 | 2018 - 2033 | ||||||||||
U.S. State | 0.4 | 2019 - 2022 | ||||||||||
The timing and manner in which we are permitted to utilize our net operating loss carryforwards may be limited by Internal Revenue Code Section 382, Limitation on Net Operating Loss Carry-forwards and Certain Built-in-Losses Following Ownership Change. | ||||||||||||
Unrecognized Tax Benefits | ||||||||||||
Following is a reconciliation of gross unrecognized tax benefits from uncertain tax positions, excluding the impact of penalties and interest (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Unrecognized tax benefits, beginning of year | $ | 2,530 | $ | 4,376 | $ | 3,342 | ||||||
Additions for tax positions taken in prior years | 166 | — | 1,017 | |||||||||
Reductions for tax positions taken in prior years | (472 | ) | (972 | ) | — | |||||||
Additions for tax positions related to the current year | 54 | — | 73 | |||||||||
Lapses of statutes of limitations | (314 | ) | (874 | ) | (56 | ) | ||||||
Unrecognized tax benefits, end of year | $ | 1,964 | $ | 2,530 | $ | 4,376 | ||||||
Of the $2.0 million of gross unrecognized tax benefits from uncertain tax positions outstanding as of December 31, 2013, $1.6 million would affect our effective tax rate if recognized. | ||||||||||||
We recognize tax-related interest and penalties as a component of income tax expense. We had $1.6 million cumulative liability for interest and penalties related to uncertain tax positions for both years 2013 and 2012. | ||||||||||||
Our U.S. federal income tax returns for 2009 through 2013 are open to review by the U.S. Internal Revenue Service. Our state income tax returns for 2006 through 2013 are open to review, depending on the respective statute of limitation in each state. In addition, we file income tax returns in several non-U.S. jurisdictions with varying statutes of limitation. | ||||||||||||
As of December 31, 2013, we believe it is reasonably likely that, within the next 12 months, $0.1 million of previously unrecognized tax benefits related to certain U.S. and non-U.S. filing positions will be recognized as statutes of limitation expire. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Equity [Abstract] | ' | |||||||||||
Stockholders' Equity | ' | |||||||||||
STOCK-BASED COMPENSATION | ||||||||||||
2005 Long-Term Incentive Plan | ||||||||||||
Our 2005 Long-Term Incentive Plan (the “2005 Plan”), which is administered by the Compensation Committee of the Board of Directors, authorizes us to grant various types of stock-based awards including: stock options, stock appreciation rights, restricted stock, restricted stock units ("RSUs") and performance stock units ("PSUs"). Stock options granted under the 2005 Plan shall not have an exercise price less than the fair market value of our common stock on the date of the grant. The exercise price of a stock option or stock appreciation right may not be reduced without shareholder approval. Stock options generally vest over periods of three or four years of continuous service, commencing on the date of grant. Stock options granted under the 2005 Plan have a seven-year contractual term. Stock options granted under the preceding plan expire after ten years. | ||||||||||||
Upon adoption, there were approximately 4.0 million shares available for issuance under the 2005 Plan. The number of shares available for issuance is increased by any shares of common stock which were previously reserved for issuance under our preceding stock option plan, and were not subject to grant on June 6, 2005, or as to which the stock-based compensation award is forfeited on or after June 6, 2005. The number of shares available for issuance is reduced by (i) two shares for each share delivered in settlement of any stock appreciation rights, for each share of restricted stock, and for each stock unit or performance unit award, and (ii) one share for each share delivered in settlement of a stock option award. In no event shall more than 1.0 million aggregate shares of common stock subject to stock options, stock appreciation rights, restricted stock or performance stock unit awards be granted to any one participant in any one year under the 2005 Plan. At December 31, 2013, we had 3.8 million shares available for future grant under our 2005 Plan and we had 5.1 million shares of our common stock reserved for future issuance pursuant to the 2005 Plan and our previous plan. | ||||||||||||
Stock Option Activity | ||||||||||||
Stock option activity was as follows (shares in thousands): | ||||||||||||
Options Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Exercise | ||||||||||||
Price | ||||||||||||
Outstanding at December 31, 2012 | 1,184 | $ | 6.92 | |||||||||
Granted | 79 | 6.46 | ||||||||||
Forfeited, canceled or expired | (160 | ) | 10.7 | |||||||||
Exercised | (110 | ) | 3.12 | |||||||||
Outstanding at December 31, 2013 | 993 | 6.73 | ||||||||||
Certain information regarding options outstanding at December 31, 2013 was as follows: | ||||||||||||
Options Outstanding | Options Exercisable | Options Vested and Expected to Vest | ||||||||||
Number (in thousands) | 993 | 698 | 991 | |||||||||
Weighted-average exercise price | $ | 6.73 | $ | 8.03 | $ | 6.73 | ||||||
Aggregate intrinsic value (in millions) | $ | 3.8 | $ | 2.4 | $ | 3.8 | ||||||
Weighted average remaining contractual term (in years) | 3.5 | 2.4 | 3.5 | |||||||||
RSU Activity | ||||||||||||
Following is a summary of RSU activity (shares in thousands): | ||||||||||||
RSUs Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Grant Date Fair Value per Share | ||||||||||||
Outstanding at December 31, 2012 | 179 | $ | 2.6 | |||||||||
Granted | 34 | 6.62 | ||||||||||
Forfeited, canceled or expired | (2 | ) | — | |||||||||
Vested | (72 | ) | 2.6 | |||||||||
Outstanding at December 31, 2013 | 139 | 3.58 | ||||||||||
PSU Activity | ||||||||||||
In April 2010, we granted PSU awards covering a total of 146,000 shares of our common stock to key members of our executive team. The PSUs were subject to both time-based vesting (one-third annually over three years) and achievement of a stock price target of two times the grant date price. If, over the three-year period, the stock price did not close at or above two times the grant date price over any 20 of 30 consecutive days, the entire award would have been forfeited. Compensation expense for PSUs is recognized over the estimated requisite service period based on the number of PSUs ultimately expected to vest. These awards vested in full over the three-year vesting period. | ||||||||||||
In February and August 2012, we granted PSU awards to certain executive officers covering a total of 82,000 shares of our common stock. The PSUs vest based on achievement of certain operating income and return on asset goals established for a three-year performance period. The number of PSUs that ultimately vest following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. The number of PSUs that vest can range from 60% of the PSUs if minimum thresholds are achieved to a maximum of 150%. | ||||||||||||
In May 2013, we granted PSU awards to certain of our executive officers covering a total of 24,500 shares of our common stock. The PSUs vest based on achievement of certain operating income and return on asset goals established for a three-year performance period. The number of shares vesting under the PSU awards following conclusion of the performance period will be determined based on the level at which the financial goals are achieved. The number of shares vesting can range from 60% of the PSU awards if minimum thresholds are achieved to a maximum of 150%. | ||||||||||||
Following is a summary of PSU activity (shares in thousands): | ||||||||||||
PSUs Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Grant Date Fair Value per Share | ||||||||||||
Outstanding at December 31, 2012 | 132 | $ | 2.59 | |||||||||
Granted | 25 | 6.62 | ||||||||||
Forfeited, canceled or expired | (17 | ) | 3.56 | |||||||||
Vested | (56 | ) | 2.32 | |||||||||
Outstanding at December 31, 2013 | 84 | 3.76 | ||||||||||
Stock-Based Compensation | ||||||||||||
We receive income tax deductions as a result of the exercise of certain stock options and vesting of RSUs and PSUs. Stock-based compensation expense, primarily included in general and administrative expense, was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Stock options | $ | 337 | $ | 355 | $ | 26 | ||||||
Restricted stock units | 54 | 188 | 150 | |||||||||
Performance stock units | 63 | 87 | 130 | |||||||||
$ | 454 | $ | 630 | $ | 306 | |||||||
Certain other information regarding our stock-based compensation was as follows (in thousands, except per share amounts): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Weighted average grant-date per share fair value of stock options granted | $ | 4.37 | $ | 1.89 | $ | 1.86 | ||||||
Total intrinsic value of stock options exercised | 451 | 33 | 2 | |||||||||
Fair value of RSUs vested | 545 | 405 | — | |||||||||
Fair value of PSUs vested | 386 | — | — | |||||||||
As of December 31, 2013, unrecognized compensation expense for outstanding, but unvested stock-based awards was $0.5 million, which is expected to be recognized over a weighted average period of 1.5 years. | ||||||||||||
Assumptions used in calculating the fair value of stock-option grants were as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Dividend yield | — | % | — | % | — | % | ||||||
Risk-free interest rate | 0.9 | % | 0.9 | % | 1.5 | % | ||||||
Expected life (years) | 4.75 | 4.75 | 4.75 | |||||||||
Expected volatility | 89 | % | 92 | % | 92 | % | ||||||
Expected dividend yield is based on our current expectation that no dividend payments will be made in future periods. | ||||||||||||
Risk-free interest rate is the U.S. Treasury zero-coupon rate, as of the grant date, for issues having a term approximately equal to the expected life of the stock option. | ||||||||||||
Expected life is the period of time over which stock options are expected to remain outstanding. We calculate expected term based on the average of the sum of the vesting periods and the full contractual term. | ||||||||||||
Expected volatility is the percentage amount by which the price of our common stock is expected to fluctuate annually during the estimated expected life for stock options. Expected price volatility is calculated using historical daily closing prices over a period matching the weighted-average expected life, as management believes such changes are the best indicator of future volatility. | ||||||||||||
We estimate future forfeitures, at the time of grant and in subsequent periods, based on historical turnover rates, previous forfeiture experience and changes in the business or key personnel that would suggest future forfeitures may differ from historical data. We recognize compensation expense for only those stock options and other stock-based awards that are expected to vest. We reevaluate estimated forfeitures each quarter and, if applicable, recognize a cumulative effect adjustment in the period of the change if the revised estimate of the impact of forfeitures differs significantly from the previous estimate. |
Income_Loss_Per_Share
Income (Loss) Per Share | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Income (Loss) Per Share | ' | ||||||||
INCOME PER SHARE | |||||||||
The weighted average numbers of shares outstanding used to compute income per share amounts were as follows (in thousands): | |||||||||
Year Ended December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
Shares used for basic per share calculations | 31,072 | 30,851 | 30,746 | ||||||
Dilutive effect of outstanding options, PSUs and RSUs | 385 | 123 | 30 | ||||||
Shares used for diluted per share calculations | 31,457 | 30,974 | 30,776 | ||||||
The weighted average numbers of shares outstanding listed in the table below were anti-dilutive and excluded from the computation of Diluted Income Per Share, primarily because the average market price did not exceed the exercise price. These shares may be dilutive potential common shares in the future (in thousands): | |||||||||
As of December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
Stock options | 304 | 1,072 | 1,114 | ||||||
PSUs | 12 | 26 | 89 | ||||||
RSUs | — | — | 217 | ||||||
Segment_Information
Segment Information | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
Segment Information | ' | |||||||||||
SEGMENT AND GEOGRAPHIC INFORMATION | ||||||||||||
We have two reportable segments - Direct and Retail. Contribution is the measure of profit or loss, defined as net sales less product costs and directly attributable expenses. Directly attributable expenses include Selling and Marketing expenses, General and Administrative expenses, and Research and Development expenses that are directly related to segment operations. Segment assets are those directly assigned to an operating segment's operations, primarily Accounts Receivable, Inventories and Intangible Assets. Unallocated assets primarily include shared information technology infrastructure, distribution centers, corporate headquarters, Prepaids and Other Current Assets, Deferred Income Tax Assets and Other Assets. Capital expenditures directly attributable to the Direct and Retail segments were not significant in any period. | ||||||||||||
Following is summary information by reportable segment (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net Sales: | ||||||||||||
Direct | $ | 136,663 | $ | 124,978 | $ | 107,061 | ||||||
Retail | 76,775 | 63,891 | 68,591 | |||||||||
Unallocated royalty income | 5,365 | 5,057 | 4,760 | |||||||||
Consolidated Net Sales | $ | 218,803 | $ | 193,926 | $ | 180,412 | ||||||
Contribution: | ||||||||||||
Direct | $ | 14,126 | $ | 12,479 | $ | 2,954 | ||||||
Retail | 11,431 | 7,855 | 9,489 | |||||||||
Unallocated royalty income | 5,365 | 5,057 | 4,760 | |||||||||
Consolidated contribution | $ | 30,922 | $ | 25,391 | $ | 17,203 | ||||||
Reconciliation of consolidated contribution to income from continuing operations: | ||||||||||||
Consolidated contribution | $ | 30,922 | $ | 25,391 | $ | 17,203 | ||||||
Amounts not directly related to segments: | ||||||||||||
Operating expenses | (15,198 | ) | (14,801 | ) | (13,604 | ) | ||||||
Other income (expense), net | 315 | (174 | ) | (412 | ) | |||||||
Income tax benefit (expense) | 32,085 | 226 | (686 | ) | ||||||||
Income from continuing operations | $ | 48,124 | $ | 10,642 | $ | 2,501 | ||||||
Depreciation and amortization expense: | ||||||||||||
Direct | $ | 1,956 | $ | 2,366 | $ | 2,742 | ||||||
Retail | 642 | 825 | 844 | |||||||||
Unallocated corporate | 746 | 78 | 229 | |||||||||
Total depreciation and amortization expense | $ | 3,344 | $ | 3,269 | $ | 3,815 | ||||||
December 31, | ||||||||||||
Assets: | 2013 | 2012 | ||||||||||
Direct | $ | 21,249 | $ | 22,349 | ||||||||
Retail | 32,023 | 27,843 | ||||||||||
Unallocated corporate | 90,295 | 44,119 | ||||||||||
Total assets | $ | 143,567 | $ | 94,311 | ||||||||
Net sales by geographic area were as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
U.S. | $ | 181,381 | $ | 167,504 | $ | 163,828 | ||||||
Canada | 34,166 | 24,977 | 15,834 | |||||||||
All other | 3,256 | 1,445 | 750 | |||||||||
$ | 218,803 | $ | 193,926 | $ | 180,412 | |||||||
There are no material long-lived assets held outside of the U.S. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||
Commitments and Contingencies | ' | |||||||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||||
Operating Leases | ||||||||||||
We lease property and equipment under non-cancelable operating leases which, in the aggregate, extend through 2019. Many of these leases contain renewal options and provide for rent escalations and payment of real estate taxes, maintenance, insurance and certain other operating expenses of the properties. Rent expense under all operating leases was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Rent expense | $ | 3,473 | $ | 3,218 | $ | 3,252 | ||||||
As of December 31, 2013, future minimum lease payments under non-cancelable operating leases, reduced for sublease income, were as follows (in thousands): | ||||||||||||
2014 | $ | 3,343 | ||||||||||
2015 | 3,257 | |||||||||||
2016 | 3,196 | |||||||||||
2017 | 2,160 | |||||||||||
2018 | 996 | |||||||||||
Thereafter | 664 | |||||||||||
$ | 13,616 | |||||||||||
Guarantees, Commitments and Off-Balance Sheet Arrangements | ||||||||||||
As of December 31, 2013, we had approximately $0.5 million in standby letters of credit with certain vendors with expiration dates through 2014. | ||||||||||||
We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of December 31, 2013, we had approximately $8.8 million in non-cancelable market-based purchase obligations, primarily for inventory purchases expected to be received within the next twelve months. Purchase obligations can vary from quarter-to-quarter and versus the same period in prior years due to a number of factors, including the amount of products that are shipped directly to Retail customer warehouses versus through Nautilus warehouses. | ||||||||||||
In the ordinary course of business, we enter into agreements that require us to indemnify counterparties against third-party claims. These may include: agreements with vendors and suppliers, under which we may indemnify them against claims arising from use of their products or services; agreements with customers, under which we may indemnify them against claims arising from their use or sale of our products; real estate and equipment leases, under which we may indemnify lessors against third-party claims relating to the use of their property; agreements with licensees or licensors, under which we may indemnify the licensee or licensor against claims arising from their use of our intellectual property or our use of their intellectual property; and agreements with parties to debt arrangements, under which we may indemnify them against claims relating to their participation in the transactions. | ||||||||||||
The nature and terms of these indemnification obligations vary from contract to contract, and generally a maximum obligation is not stated within the agreements. We hold insurance policies that mitigate potential losses arising from certain types of indemnification obligations. Management does not deem these obligations to be significant to our financial position, results of operations or cash flows and, therefore, no related liabilities were recorded as of December 31, 2013. | ||||||||||||
Legal Matters | ||||||||||||
From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. | ||||||||||||
Litigation and jury verdicts are, to some degree, inherently unpredictable, and although we have determined that a loss is not probable in connection with any current legal proceeding, it is reasonably possible that a loss may be incurred in connection with proceedings to which we are a party. Assessment of whether incurrence of a loss is probable, or a reasonable possibility, in connection with a particular proceeding, and estimation of the loss, or a range of loss, involves complex judgments and numerous uncertainties. Management is unable to estimate a range of reasonably possible losses related to litigation in its early stages, especially when the damages sought are indeterminate, or the legal and factual basis for the relevant claims have not been developed with specificity, as such zero liability is recorded as of December 31, 2013. | ||||||||||||
We regularly monitor our estimated exposure to these contingencies and, as additional information becomes known, may change our estimates accordingly. We evaluate, on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would make a loss probable or reasonably possible, and whether the amount of a probable or reasonably possible loss is estimable. Among other factors, we evaluate the advice of internal and external counsel, the outcomes from similar litigation, current status of the lawsuits (including settlement initiatives), legislative developments and other factors. Due to the numerous variables associated with these judgments and assumptions, both the precision and reliability of the resulting estimates of the related loss contingencies are subject to substantial uncertainties. |
Supplementary_Information_Quar
Supplementary Information - Quarterly Results of Operations (unaudited) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||||||
Supplementary Information - Quarterly Results of Operations Unaudited | ' | |||||||||||||||||||
SUPPLEMENTARY INFORMATION - QUARTERLY RESULTS OF OPERATIONS (unaudited) | ||||||||||||||||||||
The following table summarizes our unaudited quarterly financial data for 2013 and 2012 (in thousands, except per share amounts): | ||||||||||||||||||||
Quarter Ended | ||||||||||||||||||||
31-Mar | 30-Jun | September 30 | December 31 | Total | ||||||||||||||||
2013 | ||||||||||||||||||||
Net sales | $ | 59,214 | $ | 36,242 | $ | 46,256 | $ | 77,091 | $ | 218,803 | ||||||||||
Gross profit | 30,694 | 17,329 | 21,777 | 36,677 | 106,477 | |||||||||||||||
Operating income (loss) | 5,994 | (1,724 | ) | 1,336 | 10,118 | 15,724 | ||||||||||||||
Income from continuing operations | 5,524 | 32,668 | 1,500 | 8,432 | 48,124 | |||||||||||||||
Income (loss) from discontinued operations | (365 | ) | 195 | (116 | ) | 116 | (170 | ) | ||||||||||||
Net income(1) | 5,159 | 32,863 | 1,384 | 8,548 | 47,954 | |||||||||||||||
Net income per share: | ||||||||||||||||||||
Basic | $ | 0.17 | $ | 1.06 | $ | 0.04 | $ | 0.27 | $ | 1.54 | ||||||||||
Diluted | 0.17 | 1.05 | 0.04 | 0.27 | 1.52 | |||||||||||||||
2012 | ||||||||||||||||||||
Net sales | $ | 51,262 | $ | 39,583 | $ | 38,052 | $ | 65,029 | $ | 193,926 | ||||||||||
Gross profit | 23,905 | 17,168 | 18,541 | 31,423 | 91,037 | |||||||||||||||
Operating income (loss) | 2,829 | (599 | ) | 698 | 7,660 | 10,588 | ||||||||||||||
Income (loss) from continuing operations | 2,647 | (486 | ) | 1,216 | 7,265 | 10,642 | ||||||||||||||
Income (loss) from discontinued operations | (125 | ) | 322 | (265 | ) | 6,309 | 6,241 | |||||||||||||
Net income (loss)(2) | 2,522 | (164 | ) | 951 | 13,574 | 16,883 | ||||||||||||||
Net income (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.08 | $ | (0.01 | ) | $ | 0.03 | $ | 0.44 | $ | 0.55 | |||||||||
Diluted | 0.08 | (0.01 | ) | 0.03 | 0.44 | 0.55 | ||||||||||||||
(1) Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||||||||||||||||||
(2) Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | |
Dec. 31, 2013 | ||
Accounting Policies [Abstract] | ' | |
Discontinued Operation | ' | |
Discontinued Operations | ||
Results from discontinued operations relate to the disposal of our former Commercial business, which began in 2009 and was completed in April 2011. We reached substantial completion of asset liquidation at December 31, 2012. However, we continue to have legal and accounting expenses as we work with authorities on final deregistration of each entity and product liability expenses associated with product previously sold into the Commercial channel. | ||
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 in the financial statements. Our most significant estimates relate to the following: | ||
• | Revenue recognition; | |
• | Sales discounts and allowances; | |
• | Goodwill and other long-term asset valuation; | |
• | Product warranty obligations; | |
• | Valuation of excess and obsolete inventory; | |
• | Litigation and loss contingencies; | |
• | Deferred tax assets and the related valuation allowance; and | |
• | Unrecognized tax benefits. | |
Actual results could differ from our estimates. | ||
Concentrations of risk | ' | |
Concentrations | ||
Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash held in bank accounts in excess of federally-insured limits and trade receivables. Trade receivables are generally unsecured and therefore collection is affected by the economic conditions in each of our principal markets. | ||
We rely on third-party contract manufacturers in Asia for substantially all of our products and for certain product engineering support. Business operations could be disrupted by natural disasters, difficulties in transporting products from non-U.S. suppliers, as well as political, social or economic instability in the countries where contract manufacturers or their vendors or customers conduct business. While any such contract manufacturing arrangement could be replaced over time, the temporary loss of the services of any primary contract manufacturer could delay product shipments and cause a significant disruption in our operations. | ||
We derive a significant portion of our Net Sales from a small number of our Retail customers. A loss of business from one or more of these large customers, if not replaced with new business, would negatively affect our operating results and cash flows. In 2013, 2012 and 2011, one customer accounted for more than 10%, but less than 15%, of our Net Sales. | ||
Cash, cash equivalents and restricted cash | ' | |
Cash and Cash Equivalents | ||
All highly liquid investments with maturities of three months or less at purchase are considered to be cash equivalents. As of December 31, 2013 and 2012, cash and cash equivalents consisted entirely of cash. | ||
Inventories | ' | |
Inventories | ||
Inventories are stated at the lower of cost or market, with cost determined based on the first-in, first-out method. We establish inventory allowances for excess, slow-moving and obsolete inventory based on inventory levels, expected product life and forecasted sales. Inventories are written down to market value based on historical demand, competitive factors, changes in technology and product lifecycles. | ||
Property, plant and equipment | ' | |
Property, Plant and Equipment | ||
Property, plant and equipment is stated at cost, net of accumulated depreciation. Improvements or betterments which add new functionality or significantly extend the life of an asset are capitalized. Expenditures for maintenance and repairs are expensed as incurred. The cost of assets retired, or otherwise disposed of, and the related accumulated depreciation, are removed from the accounts at the time of disposal. Gains and losses resulting from asset sales and dispositions are recognized in the period in which assets are disposed. Depreciation is recognized, using the straight-line method, over the lesser of the estimated useful lives of the assets or, in the case of leasehold improvements, the lease term, including renewal periods if we expect to exercise our renewal options. Depreciation on computer equipment, machinery and equipment and furniture and fixtures is determined based on estimated useful lives, which generally range from three-to-five years. | ||
Goodwill | ' | |
Goodwill | ||
Goodwill consists of the excess of acquisition costs over the fair values of net assets acquired in business combinations. We review goodwill for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the carrying amount may be impaired. For this purpose, goodwill is evaluated at the reporting unit level. Our goodwill is an asset of our Direct reporting unit. We performed a qualitative assessment of goodwill in the fourth quarters of 2013, 2012 and 2011 and concluded that circumstances did not more likely than not indicate an impairment had occurred. For further information regarding goodwill, see Note 6, Goodwill. | ||
Other intangible assets | ' | |
Other Intangible Assets | ||
Finite-lived intangible assets, primarily acquired patents and patent rights, are stated at cost, net of accumulated amortization. We recognize amortization expense for our finite-lived intangible assets on a straight-line basis over the estimated useful lives. | ||
Indefinite-lived intangible assets consist of acquired trademarks. Indefinite-lived intangible assets are stated at cost and are not amortized; instead, they are tested for impairment at least annually. We review our acquired trademarks for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the assets may be impaired. The fair value of trademarks is estimated using the relief from royalty approach, a standard form of discounted cash flow analysis used in the valuation of trademarks. If the carrying amount of trademarks exceeds the estimated fair value, we calculate impairment as the excess of carrying amount over the estimate of fair value. We tested our acquired trademarks for impairment in the fourth quarters of 2013, 2012 and 2011 and determined that no impairment was indicated. For further information regarding other intangible assets, see Note 7, Other Intangible Assets. | ||
Impairment of long-lived assets | ' | |
Impairment of Long-Lived Assets | ||
Long-lived assets, including property, plant and equipment and finite-lived intangible assets, are evaluated for impairment when events or circumstances indicate the carrying value may be impaired. When such an event or condition occurs, we estimates the future undiscounted cash flows to be derived from the use and eventual disposition of the asset to determine whether a potential impairment exists. If the carrying value exceeds estimated future undiscounted cash flows, we record impairment expense to reduce the carrying value of the asset to its estimated fair value. No impairment charges were recorded in 2013, 2012 or 2011. | ||
Revenue recognition | ' | |
Revenue Recognition | ||
Direct and Retail product sales and shipping revenues are recorded when products are shipped and title passes to customers. In most instances, Retail sales to customers are made pursuant to a sales contract that provides for transfer of both title and risk of loss to the customer upon our delivery to the carrier. For Direct sales, revenue is generally recognized when products are shipped. Revenue is recognized net of applicable sales incentives, such as promotional discounts, rebates and return allowances. We estimate the revenue impact of incentive programs based on the planned duration of the program and historical experience. | ||
Many Direct business customers finance their purchases through a third-party credit provider, for which we pay a commission or financing fee to the credit provider. Revenue for such transactions is recognized based on the sales price charged to the customer and the related commission or financing fee is included in Selling and Marketing expense. | ||
Sales discounts and allowances | ' | |
Sales Discounts and Returns Allowance | ||
Product sales and shipping revenues are reported net of promotional discounts and return allowances. We estimate the revenue impact of retail sales incentive programs based on the planned duration of the program and historical experience. If the amount of sales incentives is reasonably estimable, the impact of such incentives is recorded at the later of the time the customer is notified of the sales incentive or the time of the sale. We estimate our liability for product returns based on historical experience and record the expected obligation as a reduction of revenue. If actual return costs differ from previous estimates, the amount of the liability and corresponding revenue are adjusted in the period in which such costs occur. Activity in our sales discounts and returns allowance was as follows (in thousands): | ||
Taxes collected from customers and remitted to governmental authorities | ' | |
Taxes Collected from Customers and Remitted to Governmental Authorities | ||
Taxes collected from customers and remitted to governmental authorities are recorded on a net basis and excluded from revenue. | ||
Shipping and handling fees | ' | |
Shipping and Handling Fees | ||
Shipping and handling fees billed to customers are recorded gross and included in both revenue and cost of sales. | ||
Cost of sales | ' | |
Cost of Sales | ||
Cost of Sales primarily consists of: inventory costs; royalties paid to third parties; employment and occupancy costs of warehouse and distribution facilities, including depreciation of improvements and equipment; transportation expenses; product warranty expenses; distribution information systems expenses; and allocated expenses for shared administrative functions. | ||
Product warranty obligations | ' | |
Product Warranty Obligations | ||
Our products carry limited, defined warranties for defects in materials or workmanship which, according to their terms, generally obligate us to pay the costs of supplying and shipping replacement parts to customers and, in certain instances, pay for labor and other costs to service products. Outstanding product warranty periods range from sixty days to, in limited circumstances, the lifetime of certain product components. We record a liability at the time of sale for the estimated costs of fulfilling future warranty claims. If necessary, we adjust the liability for specific warranty-related matters when they become known and are reasonably estimable. Estimated warranty expense is included in Cost of Sales, based on historical warranty claim experience and available product quality data. Warranty expense is affected by the performance of new products, significant manufacturing or design defects not discovered until after the product is delivered to the customer, product failure rates, and higher or lower than expected repair costs. If warranty expense differs from previous estimates, or if circumstances change such that the assumptions inherent in previous estimates are no longer valid, the amount of product Warranty Obligations is adjusted accordingly. | ||
Litigation and loss contingencies | ' | |
Litigation and Loss Contingencies | ||
From time to time, we may be involved in various claims, lawsuits and other proceedings. These legal and tax proceedings involve uncertainty as to the eventual outcomes and losses which may be realized when one or more future events occur or fail to occur. We record expenses for litigation and loss contingencies as a component of General and Administrative expense when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. When a loss contingency is not both probable and estimable, we do not establish an accrued liability. However, if the loss (or an additional loss in excess of the accrual) is at least a reasonable possibility and material, then we disclose an estimate of the possible loss or range of loss, if such estimate can be made, or disclose that an estimate cannot be made. | ||
Advertising and promotion | ' | |
Advertising and Promotion | ||
We expense our advertising and promotion costs as incurred. Production costs of television advertising commercials are recorded as prepaid expenses until the initial broadcast, at which time such costs are expensed. Advertising and promotion costs are included in Selling and Marketing expenses. Total advertising and promotion expenses were $35.8 million, $30.9 million and $28.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. Prepaid advertising and promotion costs were $2.2 million and $1.3 million as of December 31, 2013 and 2012, respectively. | ||
Research and development | ' | |
Research and Development | ||
Internal research and development costs, which primarily consist of salaries and wages, employee benefits, expenditures for materials, and fees to use licensed technologies, are expensed as incurred. Third party research and development costs for products under development or being researched, if any, are expensed as the contracted work is performed. | ||
Income taxes | ' | |
Income Taxes | ||
We account for income taxes based on the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using the enacted tax rates expected to be in effect when the temporary differences are expected to be included, as income or expense, in the applicable tax return. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the period of the enactment. Valuation allowances are provided against deferred income tax assets if we determine it is more likely than not that such assets will not be realized. | ||
Unrecognized Tax Benefits | ||
We recognize a tax benefit from an uncertain tax position when it is more likely than not that the position will be sustained based on the technical merits of the position upon examination, including resolutions of any related appeals or litigation. | ||
Foreign currency translation | ' | |
Foreign Currency Translation | ||
We translate the accounts of our non-U.S. subsidiaries into U.S. dollars as follows: revenues, expenses, gains and losses are translated at weighted-average exchange rates during the year; and assets and liabilities are translated at the exchange rate on the balance sheet date. Translation gains and losses are reported in our Consolidated Balance Sheets as a component of Accumulated Other Comprehensive Income. In the fourth quarter of 2012, we substantially completed the liquidation of our investment in foreign subsidiaries formerly associated with the Commercial business. As a result, an accumulated translation adjustment of $6.2 million was removed from accumulated other comprehensive income and recognized as a gain of the discontinued operations. | ||
Gains and losses arising from foreign currency transactions, including transactions between us and our non-U.S. subsidiaries, are recorded as a component of other income (expense) in our Consolidated Statements of Operations. | ||
Fair value of financial instruments | ' | |
Fair Value of Financial Instruments | ||
The carrying values of Cash and Cash Equivalents, Trade Receivables, Prepaid and Other Current Assets, Short-Term Notes Receivable, Trade Payables and Accrued Liabilities approximate fair value due to their short maturities. | ||
Net Income Per Share | ' | |
Net Income Per Share | ||
Basic per share amounts were computed using the weighted average number of common shares outstanding. Diluted per share amounts were calculated using the number of basic weighted average shares outstanding increased by dilutive potential common shares related to stock-based awards, as determined by the treasury stock method. | ||
Share-based based compensation | ' | |
Stock-Based Compensation | ||
We recognize stock-based compensation expense on a straight-line basis over the applicable vesting period, based on the grant-date fair value of the award. To the extent a stock-based award is subject to performance conditions, the amount of expense recorded in a given period, if any, reflects our assessment of the probability of achieving the performance targets. | ||
Fair value of stock options is estimated using the Black-Scholes-Merton option valuation model; fair value of performance share unit awards is estimated using the binomial valuation model; fair value of restricted stock unit awards is based on the closing market price on the day preceding the grant. | ||
New Accounting Pronouncements | ' | |
New Accounting Pronouncements | ||
ASU 2013-02 | ||
In February 2013, the FASB issued ASU No. 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” Under ASU 2013-02, an entity is required to provide information about the amounts reclassified out of Accumulated Other Comprehensive Income (“AOCI”) by component. In addition, an entity is required to present, either on the face of the financial statements or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required to be reclassified in its entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about those amounts. The adoption of ASU 2013-02 in January 2013 did not have any impact on our financial position, results of operations or cash flows. | ||
ASU 2013-11 | ||
In July 2013, the FASB issued ASU No. 2013-11, “Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.” ASU 2013-11 amends the guidance related to the presentation of unrecognized tax benefits and allows for the reduction of a deferred tax asset for a net operating loss (“NOL”) carryforward whenever the NOL or tax credit carryforward would be available to reduce the additional taxable income or tax due if the tax position is disallowed. ASU 2013-11 is effective for annual and interim periods for fiscal years beginning after December 15, 2013, and early adoption is permitted. Since ASU 2013-11 relates only to the presentation of unrecognized tax benefits, we do not expect our adoption of ASU 2013-11 in January 2014 will have a material effect on our financial position, results of operations or cash flows. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Significant Accounting Policies [Abstract] | ' | |||||||||||
Schedule of Sales Discounts and Returns Allowance | ' | |||||||||||
Activity in our sales discounts and returns allowance was as follows (in thousands): | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 4,990 | $ | 5,113 | $ | 4,695 | ||||||
Charges to reserve | 13,345 | 11,730 | 10,735 | |||||||||
Reductions for sales discounts and returns | (14,229 | ) | (11,853 | ) | (10,317 | ) | ||||||
Balance, December 31 | $ | 4,106 | $ | 4,990 | $ | 5,113 | ||||||
Discontinued_Operation_Tables
Discontinued Operation (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Discontinued Operations and Disposal Groups [Abstract] | ' | |||||||||||
Schedule of Operating Results of Company's Former Commercial Business | ' | |||||||||||
Following is a summary of certain financial information regarding the Commercial business (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Revenue | $ | — | $ | — | $ | 86 | ||||||
Loss from discontinued operations | $ | (559 | ) | $ | (163 | ) | $ | (2,291 | ) | |||
Gain on disposal activities | — | — | 280 | |||||||||
(559 | ) | (163 | ) | (2,011 | ) | |||||||
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | — | 6,170 | — | |||||||||
Reduction of previously-estimated disposal loss | — | — | 946 | |||||||||
Income tax benefit (expense) | 389 | 234 | (16 | ) | ||||||||
Total income (loss) from discontinued operations | $ | (170 | ) | $ | 6,241 | $ | (1,081 | ) | ||||
The following table summarizes liabilities for exit costs related to discontinued operations, included in Accrued Liabilities and Other Long-Term Liabilities in our Condensed Consolidated Balance Sheets (in thousands): | ||||||||||||
Facilities | Severance and Benefits | |||||||||||
Leases | ||||||||||||
Balance as of January 1, 2011 | $ | 2,160 | $ | 476 | ||||||||
Adjustments | 217 | 175 | ||||||||||
Payments | (448 | ) | (476 | ) | ||||||||
Balance as of December 31, 2011 | 1,929 | 175 | ||||||||||
Adjustments | (390 | ) | — | |||||||||
Payments | (421 | ) | (175 | ) | ||||||||
Balance as of December 31, 2012 | 1,118 | — | ||||||||||
Payments | (287 | ) | — | |||||||||
Balance as of December 31, 2013 | $ | 831 | $ | — | ||||||||
Trade_Receivables_Tables
Trade Receivables (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Receivables [Abstract] | ' | |||||||||||
Allowance for doubtful accounts | ' | |||||||||||
Changes in our allowance for doubtful trade receivables were as follows (in thousands): | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 93 | $ | 300 | $ | 301 | ||||||
Charges to (reversals of) bad debt expense | 588 | (13 | ) | 156 | ||||||||
Writeoffs, net of recoveries | (628 | ) | (194 | ) | (157 | ) | ||||||
Balance, December 31 | $ | 53 | $ | 93 | $ | 300 | ||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Schedule of Inventories, Net of Valuation Allowances | ' | |||||||
Inventories, net, consisted of the following (in thousands): | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Finished goods | $ | 14,259 | $ | 17,148 | ||||
Parts and components | 1,565 | 1,639 | ||||||
$ | 15,824 | $ | 18,787 | |||||
Property_Plant_and_Equipment_T
Property, Plant, and Equipment (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||||
Schedule of Property, Plant and Equipment | ' | |||||||||||
Property, plant and equipment consisted of the following (in thousands): | ||||||||||||
Estimated | December 31, | |||||||||||
Useful Life | ||||||||||||
(in years) | 2013 | 2012 | ||||||||||
Leasehold improvements | 5 to 20 | $ | 2,869 | $ | 2,863 | |||||||
Computer equipment | 3 to 5 | 35,554 | 36,107 | |||||||||
Machinery and equipment | 3 to 5 | 5,648 | 5,359 | |||||||||
Furniture and fixtures | 5 | 688 | 870 | |||||||||
Work in progress 1 | N/A | 4,281 | 2,080 | |||||||||
Total cost | 49,040 | 47,279 | ||||||||||
Accumulated depreciation | (40,541 | ) | (41,141 | ) | ||||||||
$ | 8,499 | $ | 6,138 | |||||||||
1 Work in progress includes internal use software development and production tooling construction in progress. | ||||||||||||
Depreciation expense was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Depreciation expense | $ | 1,254 | $ | 1,199 | $ | 1,644 | ||||||
Goodwill_Tables
Goodwill (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||
Schedule of Goodwill [Table Text Block] | ' | |||
Direct reporting unit. The rollforward of Goodwill was as follows (in thousands): | ||||
Balance, December 31, 2010 | $ | 2,931 | ||
Currency exchange rate adjustment | (58 | ) | ||
Balance, December 31, 2011 | 2,873 | |||
Currency exchange rate adjustment | 67 | |||
Balance, December 31, 2012 | 2,940 | |||
Currency exchange rate adjustment | (200 | ) | ||
Balance, December 31, 2013 | $ | 2,740 | ||
Other_Intangible_Assets_Tables
Other Intangible Assets (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||
Intangible assets | ' | |||||||||||
Intangible assets consisted of the following (in thousands): | ||||||||||||
Estimated | December 31, | |||||||||||
Useful Life | ||||||||||||
(in years) | 2013 | 2012 | ||||||||||
Indefinite life trademarks | N/A | $ | 9,052 | $ | 9,052 | |||||||
Patents | 8 | to | 16 | 18,154 | 18,154 | |||||||
27,206 | 27,206 | |||||||||||
Accumulated amortization - patents | (14,591 | ) | (12,540 | ) | ||||||||
$ | 12,615 | $ | 14,666 | |||||||||
Amortization expense | ' | |||||||||||
Amortization expense was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Amortization expense | $ | 2,050 | $ | 2,050 | $ | 2,058 | ||||||
Future amortization expense | ' | |||||||||||
Future amortization of patents is as follows (in thousands): | ||||||||||||
2014 | $ | 2,040 | ||||||||||
2015 | 828 | |||||||||||
2016 | 430 | |||||||||||
2017 | 143 | |||||||||||
2018 | 65 | |||||||||||
Thereafter | 57 | |||||||||||
$ | 3,563 | |||||||||||
Accrued_Liabilities_Tables
Accrued Liabilities (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Payables and Accruals [Abstract] | ' | |||||||
Schedule of Accrued Liabilities [Table Text Block] | ' | |||||||
Accrued liabilities consisted of the following (in thousands): | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Payroll and related liabilities | $ | 4,244 | $ | 3,327 | ||||
Other | 4,879 | 4,844 | ||||||
$ | 9,123 | $ | 8,171 | |||||
Product_Warranties_Tables
Product Warranties (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Product Warranties Disclosures [Abstract] | ' | |||||||||||
Schedule of Product Warranty Liability | ' | |||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Balance, January 1 | $ | 2,492 | $ | 2,017 | $ | 3,935 | ||||||
Accruals | 1,097 | 2,615 | 1,789 | |||||||||
Adjustments | (186 | ) | (170 | ) | (660 | ) | ||||||
Payments | (1,765 | ) | (1,970 | ) | (3,047 | ) | ||||||
Balance, December 31 | $ | 1,638 | $ | 2,492 | $ | 2,017 | ||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] | ' | |||||||||||
Income from continuing operations before income taxes was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
United States | $ | 15,386 | $ | 10,025 | $ | 2,876 | ||||||
Non-U.S. | 653 | 391 | 311 | |||||||||
$ | 16,039 | $ | 10,416 | $ | 3,187 | |||||||
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | ' | |||||||||||
Income tax (benefit) expense from continuing operations was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Current: | ||||||||||||
U.S. federal | $ | 541 | $ | (579 | ) | $ | 172 | |||||
U.S. state | 56 | 53 | 26 | |||||||||
Non-U.S. | (12 | ) | 155 | 77 | ||||||||
Total current | 585 | (371 | ) | 275 | ||||||||
Deferred: | ||||||||||||
U.S. federal | (29,552 | ) | 177 | 314 | ||||||||
U.S. state | (3,370 | ) | 17 | 27 | ||||||||
Non-U.S. | 252 | (49 | ) | 70 | ||||||||
Total deferred | (32,670 | ) | 145 | 411 | ||||||||
$ | (32,085 | ) | $ | (226 | ) | $ | 686 | |||||
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | ' | |||||||||||
(in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred Income Tax Assets: | ||||||||||||
Accrued liabilities | $ | 3,230 | $ | 3,312 | ||||||||
Allowance for doubtful accounts | 20 | 21 | ||||||||||
Inventory valuation | 312 | 382 | ||||||||||
Capitalized indirect inventory costs | 159 | 207 | ||||||||||
Stock-based compensation expense | 376 | 612 | ||||||||||
Net operating loss carryforward | 35,635 | 40,540 | ||||||||||
Capital loss carryforward | — | 4,319 | ||||||||||
Basis difference on long-lived assets | 4,412 | 5,783 | ||||||||||
Credit carryforward | 3,422 | 3,088 | ||||||||||
Other | 332 | 473 | ||||||||||
Gross Deferred Income Tax Assets | 47,898 | 58,737 | ||||||||||
Valuation allowance | (12,944 | ) | (57,230 | ) | ||||||||
Deferred Income Tax Assets, net of valuation allowance | 34,954 | 1,507 | ||||||||||
Deferred Income Tax Liabilities: | ||||||||||||
Prepaid advertising | (793 | ) | (381 | ) | ||||||||
Other prepaids | (592 | ) | (320 | ) | ||||||||
Basis difference on long-lived assets | (2,938 | ) | (2,678 | ) | ||||||||
Undistributed earnings of foreign subsidiaries | (177 | ) | (136 | ) | ||||||||
Other | (288 | ) | (319 | ) | ||||||||
Deferred Income Tax Liabilities | (4,788 | ) | (3,834 | ) | ||||||||
Net Deferred Income Tax Asset (Liability) | $ | 30,166 | $ | (2,327 | ) | |||||||
Our Net Deferred Income Tax Asset (Liability) was recorded on our Consolidated Balance Sheets as follows (in thousands): | ||||||||||||
December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Current Deferred Income Tax Assets | $ | 4,441 | $ | 193 | ||||||||
Current Deferred Income Tax Liabilities | — | (1,275 | ) | |||||||||
Long-Term Deferred Income Tax Assets | 25,725 | 239 | ||||||||||
Non-Current Deferred Income Tax Liabilities | — | (1,484 | ) | |||||||||
Net Deferred Income Tax Asset (Liability) | $ | 30,166 | $ | (2,327 | ) | |||||||
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | ' | |||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
U.S. statutory income tax rate | 35 | % | 35 | % | 35 | % | ||||||
State tax, net of U.S. federal tax benefit | 2.9 | 1.1 | 5.2 | |||||||||
Non-U.S. income taxes | 1.2 | — | 2.1 | |||||||||
Nondeductible operating expenses | (0.4 | ) | 0.4 | (1.8 | ) | |||||||
Research and development credit | (0.7 | ) | — | (2.6 | ) | |||||||
Change in deferred tax measurement rate | 0.2 | 0.1 | (0.3 | ) | ||||||||
Change in uncertain tax positions | 2.2 | (6.5 | ) | 13 | ||||||||
Expiration of capital loss carryforward | 26.9 | — | — | |||||||||
Change in valuation allowance | (267.6 | ) | (32.3 | ) | (29.0 | ) | ||||||
Other | 0.2 | — | (0.1 | ) | ||||||||
Effective income tax rate | (200.1 | )% | (2.2 | )% | 21.5 | % | ||||||
Summary of Income Tax Carryforwards [Table Text Block] | ' | |||||||||||
As of December 31, 2013, we had the following income tax carryforwards (in millions): | ||||||||||||
Amount | Expires in | |||||||||||
Net operating loss carryforwards: | ||||||||||||
U.S. Federal | $ | 64.4 | 2029 - 2031 | |||||||||
U.S. State | 98.3 | 2014 - 2031 | ||||||||||
Germany | 11.2 | Indefinite | ||||||||||
Switzerland | 20.4 | 2014 - 2020 | ||||||||||
China | 3.8 | 2014 - 2016 | ||||||||||
Italy | 2.6 | 2014 - 2017 | ||||||||||
Income tax credit carryforwards: | ||||||||||||
U.S. Federal | 2.9 | 2018 - 2033 | ||||||||||
U.S. State | 0.4 | 2019 - 2022 | ||||||||||
Schedule of Reconciliatin of Gross Unrecognized Tax Benefits From Uncertain Tax Positions Roll Forward [Table Text Block] | ' | |||||||||||
Following is a reconciliation of gross unrecognized tax benefits from uncertain tax positions, excluding the impact of penalties and interest (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Unrecognized tax benefits, beginning of year | $ | 2,530 | $ | 4,376 | $ | 3,342 | ||||||
Additions for tax positions taken in prior years | 166 | — | 1,017 | |||||||||
Reductions for tax positions taken in prior years | (472 | ) | (972 | ) | — | |||||||
Additions for tax positions related to the current year | 54 | — | 73 | |||||||||
Lapses of statutes of limitations | (314 | ) | (874 | ) | (56 | ) | ||||||
Unrecognized tax benefits, end of year | $ | 1,964 | $ | 2,530 | $ | 4,376 | ||||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Equity [Abstract] | ' | |||||||||||
Stock option activity | ' | |||||||||||
Stock option activity was as follows (shares in thousands): | ||||||||||||
Options Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Exercise | ||||||||||||
Price | ||||||||||||
Outstanding at December 31, 2012 | 1,184 | $ | 6.92 | |||||||||
Granted | 79 | 6.46 | ||||||||||
Forfeited, canceled or expired | (160 | ) | 10.7 | |||||||||
Exercised | (110 | ) | 3.12 | |||||||||
Outstanding at December 31, 2013 | 993 | 6.73 | ||||||||||
Stock options outstanding | ' | |||||||||||
Certain information regarding options outstanding at December 31, 2013 was as follows: | ||||||||||||
Options Outstanding | Options Exercisable | Options Vested and Expected to Vest | ||||||||||
Number (in thousands) | 993 | 698 | 991 | |||||||||
Weighted-average exercise price | $ | 6.73 | $ | 8.03 | $ | 6.73 | ||||||
Aggregate intrinsic value (in millions) | $ | 3.8 | $ | 2.4 | $ | 3.8 | ||||||
Weighted average remaining contractual term (in years) | 3.5 | 2.4 | 3.5 | |||||||||
RSU activity | ' | |||||||||||
Following is a summary of RSU activity (shares in thousands): | ||||||||||||
RSUs Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Grant Date Fair Value per Share | ||||||||||||
Outstanding at December 31, 2012 | 179 | $ | 2.6 | |||||||||
Granted | 34 | 6.62 | ||||||||||
Forfeited, canceled or expired | (2 | ) | — | |||||||||
Vested | (72 | ) | 2.6 | |||||||||
Outstanding at December 31, 2013 | 139 | 3.58 | ||||||||||
PSU activity | ' | |||||||||||
Following is a summary of PSU activity (shares in thousands): | ||||||||||||
PSUs Outstanding | Weighted- | |||||||||||
Average | ||||||||||||
Grant Date Fair Value per Share | ||||||||||||
Outstanding at December 31, 2012 | 132 | $ | 2.59 | |||||||||
Granted | 25 | 6.62 | ||||||||||
Forfeited, canceled or expired | (17 | ) | 3.56 | |||||||||
Vested | (56 | ) | 2.32 | |||||||||
Outstanding at December 31, 2013 | 84 | 3.76 | ||||||||||
Stock-based compensation | ' | |||||||||||
Stock-based compensation expense, primarily included in general and administrative expense, was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Stock options | $ | 337 | $ | 355 | $ | 26 | ||||||
Restricted stock units | 54 | 188 | 150 | |||||||||
Performance stock units | 63 | 87 | 130 | |||||||||
$ | 454 | $ | 630 | $ | 306 | |||||||
Other information regarding stock-based compensation | ' | |||||||||||
Certain other information regarding our stock-based compensation was as follows (in thousands, except per share amounts): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Weighted average grant-date per share fair value of stock options granted | $ | 4.37 | $ | 1.89 | $ | 1.86 | ||||||
Total intrinsic value of stock options exercised | 451 | 33 | 2 | |||||||||
Fair value of RSUs vested | 545 | 405 | — | |||||||||
Fair value of PSUs vested | 386 | — | — | |||||||||
Assumptions | ' | |||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Dividend yield | — | % | — | % | — | % | ||||||
Risk-free interest rate | 0.9 | % | 0.9 | % | 1.5 | % | ||||||
Expected life (years) | 4.75 | 4.75 | 4.75 | |||||||||
Expected volatility | 89 | % | 92 | % | 92 | % |
Income_Loss_Per_Share_Tables
Income (Loss) Per Share (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Schedule of Weighted Average Number of Shares Outstanding Used to Compute Income Per Share | ' | ||||||||
The weighted average numbers of shares outstanding used to compute income per share amounts were as follows (in thousands): | |||||||||
Year Ended December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
Shares used for basic per share calculations | 31,072 | 30,851 | 30,746 | ||||||
Dilutive effect of outstanding options, PSUs and RSUs | 385 | 123 | 30 | ||||||
Shares used for diluted per share calculations | 31,457 | 30,974 | 30,776 | ||||||
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||
As of December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
Stock options | 304 | 1,072 | 1,114 | ||||||
PSUs | 12 | 26 | 89 | ||||||
RSUs | — | — | 217 | ||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||
Summary Information by Reportable Segments | ' | |||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Net Sales: | ||||||||||||
Direct | $ | 136,663 | $ | 124,978 | $ | 107,061 | ||||||
Retail | 76,775 | 63,891 | 68,591 | |||||||||
Unallocated royalty income | 5,365 | 5,057 | 4,760 | |||||||||
Consolidated Net Sales | $ | 218,803 | $ | 193,926 | $ | 180,412 | ||||||
Contribution: | ||||||||||||
Direct | $ | 14,126 | $ | 12,479 | $ | 2,954 | ||||||
Retail | 11,431 | 7,855 | 9,489 | |||||||||
Unallocated royalty income | 5,365 | 5,057 | 4,760 | |||||||||
Consolidated contribution | $ | 30,922 | $ | 25,391 | $ | 17,203 | ||||||
Reconciliation of consolidated contribution to income from continuing operations: | ||||||||||||
Consolidated contribution | $ | 30,922 | $ | 25,391 | $ | 17,203 | ||||||
Amounts not directly related to segments: | ||||||||||||
Operating expenses | (15,198 | ) | (14,801 | ) | (13,604 | ) | ||||||
Other income (expense), net | 315 | (174 | ) | (412 | ) | |||||||
Income tax benefit (expense) | 32,085 | 226 | (686 | ) | ||||||||
Income from continuing operations | $ | 48,124 | $ | 10,642 | $ | 2,501 | ||||||
Depreciation and amortization expense: | ||||||||||||
Direct | $ | 1,956 | $ | 2,366 | $ | 2,742 | ||||||
Retail | 642 | 825 | 844 | |||||||||
Unallocated corporate | 746 | 78 | 229 | |||||||||
Total depreciation and amortization expense | $ | 3,344 | $ | 3,269 | $ | 3,815 | ||||||
December 31, | ||||||||||||
Assets: | 2013 | 2012 | ||||||||||
Direct | $ | 21,249 | $ | 22,349 | ||||||||
Retail | 32,023 | 27,843 | ||||||||||
Unallocated corporate | 90,295 | 44,119 | ||||||||||
Total assets | $ | 143,567 | $ | 94,311 | ||||||||
Net Sales by Geographic Regions | ' | |||||||||||
Net sales by geographic area were as follows: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
U.S. | $ | 181,381 | $ | 167,504 | $ | 163,828 | ||||||
Canada | 34,166 | 24,977 | 15,834 | |||||||||
All other | 3,256 | 1,445 | 750 | |||||||||
$ | 218,803 | $ | 193,926 | $ | 180,412 | |||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||||||
Schedule of Future Minimum Rental Payments for Operating Leases | ' | |||||||||||
As of December 31, 2013, future minimum lease payments under non-cancelable operating leases, reduced for sublease income, were as follows (in thousands): | ||||||||||||
2014 | $ | 3,343 | ||||||||||
2015 | 3,257 | |||||||||||
2016 | 3,196 | |||||||||||
2017 | 2,160 | |||||||||||
2018 | 996 | |||||||||||
Thereafter | 664 | |||||||||||
$ | 13,616 | |||||||||||
Schedule of Rent Expense | ' | |||||||||||
Rent expense under all operating leases was as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Rent expense | $ | 3,473 | $ | 3,218 | $ | 3,252 | ||||||
Supplementary_Information_Quar1
Supplementary Information - Quarterly Results of Operations (Tables) | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | |||||||||||||||||||
Schedule of Quarterly Financial Information [Table Text Block] | ' | |||||||||||||||||||
The following table summarizes our unaudited quarterly financial data for 2013 and 2012 (in thousands, except per share amounts): | ||||||||||||||||||||
Quarter Ended | ||||||||||||||||||||
31-Mar | 30-Jun | September 30 | December 31 | Total | ||||||||||||||||
2013 | ||||||||||||||||||||
Net sales | $ | 59,214 | $ | 36,242 | $ | 46,256 | $ | 77,091 | $ | 218,803 | ||||||||||
Gross profit | 30,694 | 17,329 | 21,777 | 36,677 | 106,477 | |||||||||||||||
Operating income (loss) | 5,994 | (1,724 | ) | 1,336 | 10,118 | 15,724 | ||||||||||||||
Income from continuing operations | 5,524 | 32,668 | 1,500 | 8,432 | 48,124 | |||||||||||||||
Income (loss) from discontinued operations | (365 | ) | 195 | (116 | ) | 116 | (170 | ) | ||||||||||||
Net income(1) | 5,159 | 32,863 | 1,384 | 8,548 | 47,954 | |||||||||||||||
Net income per share: | ||||||||||||||||||||
Basic | $ | 0.17 | $ | 1.06 | $ | 0.04 | $ | 0.27 | $ | 1.54 | ||||||||||
Diluted | 0.17 | 1.05 | 0.04 | 0.27 | 1.52 | |||||||||||||||
2012 | ||||||||||||||||||||
Net sales | $ | 51,262 | $ | 39,583 | $ | 38,052 | $ | 65,029 | $ | 193,926 | ||||||||||
Gross profit | 23,905 | 17,168 | 18,541 | 31,423 | 91,037 | |||||||||||||||
Operating income (loss) | 2,829 | (599 | ) | 698 | 7,660 | 10,588 | ||||||||||||||
Income (loss) from continuing operations | 2,647 | (486 | ) | 1,216 | 7,265 | 10,642 | ||||||||||||||
Income (loss) from discontinued operations | (125 | ) | 322 | (265 | ) | 6,309 | 6,241 | |||||||||||||
Net income (loss)(2) | 2,522 | (164 | ) | 951 | 13,574 | 16,883 | ||||||||||||||
Net income (loss) per share: | ||||||||||||||||||||
Basic | $ | 0.08 | $ | (0.01 | ) | $ | 0.03 | $ | 0.44 | $ | 0.55 | |||||||||
Diluted | 0.08 | (0.01 | ) | 0.03 | 0.44 | 0.55 | ||||||||||||||
(1) Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||||||||||||||||||
(2) Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) (USD $) | 12 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Sep. 30, 2010 | |
Minimum [Member] | Furniture, equipment and information systems [Member] | Furniture, equipment and information systems [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Sherborne [Member] | Sherborne [Member] | Sherborne [Member] | Sherborne [Member] | ||||
Minimum [Member] | Maximum [Member] | Consolidated Net Sales [Member] | Consolidated Net Sales [Member] | Customer A [Member] | Customer A [Member] | Customer A [Member] | Customer A [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | Notes Payable, Other Payables [Member] | |||||
customer | customer | Consolidated Net Sales [Member] | Consolidated Net Sales [Member] | Consolidated Net Sales [Member] | Consolidated Net Sales [Member] | |||||||||||
Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | |||||||||||||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Warranty Period | ' | ' | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of major customers | ' | ' | ' | ' | ' | ' | 1 | 1,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk, percentage | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | 10.00% | 15.00% | 15.00% | ' | ' | ' | ' |
Estimated useful life (in years) | ' | ' | ' | ' | '3 years | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning Balance | $4,990,000 | $5,113,000 | $4,695,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Charges to reserve | 13,345,000 | 11,730,000 | 10,735,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reductions for sales discounts and returns | -14,229,000 | -11,853,000 | -10,317,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending Balance | 4,106,000 | 4,990,000 | 5,113,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Marketing and advertising expense | 35,800,000 | 30,900,000 | 28,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Prepaid advertising | 2,200,000 | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Original principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 400,000 | 100,000 | ' | ' |
Outstanding principal balance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | ' |
Discontinued_Operation_Details
Discontinued Operation (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 | $86 |
Income (loss) from discontinued operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -559 | 6,007 | -1,065 |
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | ' | ' | ' | ' | 6,200 | ' | ' | ' | ' | ' | ' |
Reduction of previously-estimated disposal loss | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 947 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | 389 | 234 | -16 |
Income (loss) from discontinued operations | 116 | -116 | 195 | -365 | 6,309 | -265 | 322 | -125 | -170 | 6,241 | -1,081 |
Commercial [Member] | Severance and Benefits [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance | ' | ' | ' | 0 | ' | ' | ' | 175 | 0 | 175 | 476 |
Adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 175 |
Payments | ' | ' | ' | ' | ' | ' | ' | ' | 0 | -175 | -476 |
Balance | 0 | ' | ' | ' | 0 | ' | ' | ' | 0 | 0 | 175 |
Commercial [Member] | Lease Obligations [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance | ' | ' | ' | 1,118 | ' | ' | ' | 1,929 | 1,118 | 1,929 | 2,160 |
Adjustments | ' | ' | ' | ' | ' | ' | ' | ' | ' | -390 | 217 |
Payments | ' | ' | ' | ' | ' | ' | ' | ' | -287 | -421 | -448 |
Balance | 831 | ' | ' | ' | 1,118 | ' | ' | ' | 831 | 1,118 | 1,929 |
Commercial [Member] | Commercial [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income (loss) from discontinued operations before income taxes | ' | ' | ' | ' | ' | ' | ' | ' | -559 | -163 | -2,291 |
Gain on disposal activities | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 280 |
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax | ' | ' | ' | ' | ' | ' | ' | ' | -559 | -163 | -2,011 |
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 6,170 | 0 |
Reduction of previously-estimated disposal loss | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | 946 |
Income tax benefit (expense) | ' | ' | ' | ' | ' | ' | ' | ' | 389 | 234 | -16 |
Income (loss) from discontinued operations | ' | ' | ' | ' | ' | ' | ' | ' | ($170) | $6,241 | ($1,081) |
Trade_Receivables_Details
Trade Receivables (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ' | ' | ' |
Balance, January 1 | $93 | $300 | $301 |
Charges to (reversals of) bad debt expense | 588 | -13 | 156 |
Writeoffs, net of recoveries | -628 | -194 | -157 |
Balance, December 31 | $53 | $93 | $300 |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Finished goods | $14,259 | $17,148 |
Parts and components | 1,565 | 1,639 |
Total inventories | $15,824 | $18,787 |
Property_Plant_and_Equipment_D
Property, Plant and Equipment (Details) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | $49,040 | $47,279 | ' | ||
Accumulated depreciation | -40,541 | -41,141 | ' | ||
Total property, plant and equipment, net | 8,499 | 6,138 | ' | ||
Depreciation expense | 1,254 | 1,199 | 1,644 | ||
Leasehold improvements [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | 2,869 | 2,863 | ' | ||
Leasehold improvements [Member] | Minimum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '5 years | ' | ' | ||
Leasehold improvements [Member] | Maximum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '20 years | ' | ' | ||
Computer equipment [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | 35,554 | 36,107 | ' | ||
Computer equipment [Member] | Minimum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '3 years | ' | ' | ||
Computer equipment [Member] | Maximum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '5 years | ' | ' | ||
Machinery and equipment [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | 5,648 | 5,359 | ' | ||
Machinery and equipment [Member] | Minimum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '3 years | ' | ' | ||
Machinery and equipment [Member] | Maximum [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Estimated useful life (in years) | '5 years | ' | ' | ||
Furniture and fixtures [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | 688 | 870 | ' | ||
Estimated useful life (in years) | '5 years | ' | ' | ||
Work in progress [Member] | ' | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ||
Property, plant and equipment, gross | $4,281 | [1] | $2,080 | [1] | ' |
[1] | 1 Work in progress includes internal use software development and production tooling construction in progress. |
Goodwill_Details
Goodwill (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Goodwill [Roll Forward] | ' | ' | ' |
Balance | $2,940 | $2,873 | $2,931 |
Currency exchange rate adjustment | -200 | 67 | -58 |
Balance | $2,740 | $2,940 | $2,873 |
Other_Intangible_Assets_Detail
Other Intangible Assets (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Indefinite life trademarks | $9,052 | $9,052 | ' |
Patents | 18,154 | 18,154 | ' |
Total cost | 27,206 | 27,206 | ' |
Accumulated amortization - patents | -14,591 | -12,540 | ' |
Total other intangible assets, net | 12,615 | 14,666 | ' |
Amortization expense for intangible assets | 2,050 | 2,050 | 2,058 |
2014 | 2,040 | ' | ' |
2015 | 828 | ' | ' |
2016 | 430 | ' | ' |
2017 | 143 | ' | ' |
2018 | 65 | ' | ' |
Thereafter | 57 | ' | ' |
Finite-Lived Intangible Assets, Net | $3,563 | ' | ' |
Minimum [Member] | Patents [Member] | ' | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-lived intangible asset, useful life | '8 years | ' | ' |
Maximum [Member] | Patents [Member] | ' | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Finite-lived intangible asset, useful life | '16 years | ' | ' |
Accrued_Liabilities_Details
Accrued Liabilities (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ' | ' |
Payroll and benefits | $4,244 | $3,327 |
Other | 4,879 | 4,844 |
Accrued liabilities | $9,123 | $8,171 |
Product_Warranties_Details
Product Warranties (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Movement in Product Warranty Liability [Roll Forward] | ' | ' | ' |
Beginning Balance | $2,492 | $2,017 | $3,935 |
Accruals | 1,097 | 2,615 | 1,789 |
Adjustments | -186 | -170 | -660 |
Payments | -1,765 | -1,970 | -3,047 |
Ending Balance | $1,638 | $2,492 | $2,017 |
Borrowings_Loan_Agreement_Deta
Borrowings (Loan Agreement) (Details) (USD $) | Dec. 31, 2013 |
Debt Disclosure [Abstract] | ' |
Maximum revolving secured credit line | $15,750,000 |
Borrowing rate under agreement, at period end | 1.67% |
Standby letters of credit outstanding | 500,000 |
Avaiable for borrowing under line of credit | 15,300,000 |
Line of Credit Facility, Amount Outstanding | $0 |
Borrowings_Notes_Details
Borrowings (Notes) (Details) (Increasing Rate Senior Discount Notes [Member], USD $) | Dec. 31, 2013 | Mar. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Aggregate principal at maturity | $6,100,000 | ' |
Original principal amount | $5,000,000 | ' |
Effective rate of interest | ' | 6.40% |
Payment Made on Original Maturity [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Effective rate of interest | ' | 8.70% |
Income_Taxes_Income_Loss_Befor
Income Taxes - Income (Loss) Before Tax (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
United States | $15,386 | $10,025 | $2,876 |
Non-U.S. | 653 | 391 | 311 |
Income from continuing operations before income taxes | $16,039 | $10,416 | $3,187 |
Income_Taxes_Expense_Details
Income Taxes - Expense (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Current: | ' | ' | ' |
U.S. federal | $541 | ($579) | $172 |
U.S. state | 56 | 53 | 26 |
Non-U.S. | -12 | 155 | 77 |
Total current | 585 | -371 | 275 |
Deferred: | ' | ' | ' |
U.S. federal | -29,552 | 177 | 314 |
U.S. state | -3,370 | 17 | 27 |
Non-U.S. | 252 | -49 | 70 |
Total deferred | -32,670 | 145 | 411 |
Total income tax expense (benefit) | ($32,085) | ($226) | $686 |
Income_Taxes_Deferred_Tax_Asse
Income Taxes - Deferred Tax Assets and Liabilities (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | |
Valuation Allowance [Line Items] | ' | ' | ' | ' |
Deferred Tax Asset, Reversal Due to Expiration of Capital and Operating Loss Carryforwards | $4,400,000 | ' | ' | ' |
Equity Increase, Deferred Tax Realization | ' | ' | 300,000 | ' |
Components of Deferred Tax Assets and Liabilities [Abstract] | ' | ' | ' | ' |
Accrued liabilities | 3,230,000 | ' | 3,230,000 | 3,312,000 |
Allowance for doubtful accounts | 20,000 | ' | 20,000 | 21,000 |
Inventory valuation | 312,000 | ' | 312,000 | 382,000 |
Capitalized indirect inventory costs | 159,000 | ' | 159,000 | 207,000 |
Stock-based compensation expense | 376,000 | ' | 376,000 | 612,000 |
Net operating loss carryforward | 35,635,000 | ' | 35,635,000 | 40,540,000 |
Capital loss carryforward | 0 | ' | 0 | 4,319,000 |
Basis difference on long-lived assets | 4,412,000 | ' | 4,412,000 | 5,783,000 |
Credit carryforward | 3,422,000 | ' | 3,422,000 | 3,088,000 |
Other | 332,000 | ' | 332,000 | 473,000 |
Total deferred income tax assets before valuation allowance | 47,898,000 | ' | 47,898,000 | 58,737,000 |
Valuation allowance | -12,944,000 | ' | -12,944,000 | -57,230,000 |
Total deferred income tax assets, net of valuation allowance | 34,954,000 | ' | 34,954,000 | 1,507,000 |
Prepaid advertising | -793,000 | ' | -793,000 | -381,000 |
Other prepaids | -592,000 | ' | -592,000 | -320,000 |
Basis difference on long-lived assets | 2,938,000 | ' | 2,938,000 | 2,678,000 |
Undistributed earnings of foreign subsidiaries | -177,000 | ' | -177,000 | -136,000 |
Other | -288,000 | ' | -288,000 | -319,000 |
Deferred Income Tax Liabilities | -4,788,000 | ' | -4,788,000 | -3,834,000 |
Net Deferred Income Tax Asset (Liability) | 30,166,000 | ' | 30,166,000 | -2,327,000 |
Number of Years Cumulative Income or Loss Evaluated | ' | '3 years | ' | ' |
Income tax benefit due to reduction of existing valuation allowance | ' | 35,800,000 | 38,900,000 | ' |
Loss and Other Credit Carryforward [Member] | ' | ' | ' | ' |
Components of Deferred Tax Assets and Liabilities [Abstract] | ' | ' | ' | ' |
Valuation allowance | ($4,100,000) | ' | ($4,100,000) | ' |
Income_Taxes_Deferred_Tax_Liab
Income Taxes - Deferred Tax Liability (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Net Deferred Income Tax Liability [Abstract] | ' | ' |
Deferred income tax assets | $4,441 | $193 |
Current deferred income tax liabilities | 0 | -1,275 |
Long-term deferred income tax assets | 25,725 | 239 |
Non-current deferred income tax liabilities | 0 | -1,484 |
Net Deferred Income Tax Asset (Liability) | $30,166 | ($2,327) |
Income_Taxes_Reconciliation_De
Income Taxes - Reconciliation (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
U.S. statutory income tax rate | 35.00% | 35.00% | 35.00% |
State tax, net of U.S. federal tax benefit | 2.90% | 1.10% | 5.20% |
Non-U.S. income taxes | 1.20% | 0.00% | 2.10% |
Nondeductible incentive stock option expense | -0.40% | 0.40% | -1.80% |
Research and development credit | -0.70% | 0.00% | -2.60% |
Change in deferred tax measurement rate | 0.20% | 0.10% | -0.30% |
Change in uncertain tax positions | 2.20% | -6.50% | 13.00% |
Expiration of capital loss carryforward | 26.90% | 0.00% | 0.00% |
Valuation allowance | -267.60% | -32.30% | -29.00% |
Other | 0.20% | 0.00% | -0.10% |
Effective income tax rate for continuing operations | -200.10% | -2.20% | 21.50% |
Valuation allowance | $12,944 | $57,230 | ' |
Income_Taxes_Carryforwards_Det
Income Taxes - Carryforwards (Details) (USD $) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Federal | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | $64.40 |
Income tax credit carryforwards | 2.9 |
State | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | 98.3 |
Income tax credit carryforwards | 0.4 |
Germany | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | 11.2 |
Switzerland | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | 20.4 |
China | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | 3.8 |
Italy | ' |
Operating Loss Carryforwards [Line Items] | ' |
Net operating loss carryforwards | $2.60 |
Income_Taxes_Unrecognized_Tax_
Income Taxes - Unrecognized Tax Benefits (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ' | ' | ' |
Unrecognized tax benefits, beginning of year | $2,530,000 | $4,376,000 | $3,342,000 |
Additions for tax positions taken in prior years | 166,000 | 0 | 1,017,000 |
Reductions for tax positions taken in prior years | -472,000 | -972,000 | 0 |
Additions for tax positions related to the current year | 54,000 | 0 | 73,000 |
Lapses of statutes of limitations | -314,000 | -874,000 | -56,000 |
Unrecognized tax benefits, end of year | 1,964,000 | 2,530,000 | 4,376,000 |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 1,600,000 | ' | ' |
Cumulative liability for interest and penalties related to uncertain tax positions | 1,600,000 | ' | ' |
Previously unrecognized tax benefit likely to be recognized within the next 12 months | $100,000 | ' | ' |
Stockholders_Equity_Details
Stockholders' Equity (Details) | Dec. 31, 2013 | Dec. 31, 2013 | Jun. 06, 2005 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 |
2005 Long Term Incentive Plan [Member] | 2005 Long Term Incentive Plan [Member] | Stock Options [Member] | Stock Options [Member] | Stock Options [Member] | Stock Options [Member] | ||
2005 Long Term Incentive Plan [Member] | Plan Previous to 2005 Plan [Member] | Minimum [Member] | Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares reserved for future issuance | 5,053,000 | ' | ' | ' | ' | ' | ' |
Vesting period | ' | ' | ' | ' | ' | '3 years | '4 years |
Expected life (years) | ' | ' | ' | '7 years | '10 years | ' | ' |
Shares available for issuance | ' | 3,800,000 | 4,000,000 | ' | ' | ' | ' |
Reduction in number of shares available for issuance due to settlement of stock appreciation rights and stock unit or performance unit award | ' | 2 | ' | ' | ' | ' | ' |
Reduction in number of shares available for issuance due to settlement of stock option award | ' | 1 | ' | ' | ' | ' | ' |
Maximum aggregate shares of common stock subject to stock options, appreciation rights, restricted stock or performance stock unit awards | ' | 1,000,000 | ' | ' | ' | ' | ' |
Stockholders_Equity_Stock_Opti
Stockholders' Equity - Stock Options (Details) (USD $) | 12 Months Ended | ||
Share data in Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Stock Option Activity and Outstanding Options | ' | ' | ' |
Options outstanding | 1,184 | ' | ' |
Granted | 79 | ' | ' |
Forfeited, cancelled or expired | -160 | ' | ' |
Exercised | -110 | ' | ' |
Options outstanding | 993 | 1,184 | ' |
Stock Option Activity and Weighted-Average Exercise Price | ' | ' | ' |
Options outstanding, Weighted Average Exercise Price | $6.92 | ' | ' |
Granted, Weighted Average Exercise Price | $6.46 | ' | ' |
Forfeited, canceled or expired, Weighted Average Exercise Price | $10.70 | ' | ' |
Exercises, Weighted Average Exercise Price | $3.12 | ' | ' |
Options outstanding, Weighted Average Exercise Price | $6.73 | $6.92 | ' |
Options outstanding, Aggregate Intrinsic Value | $3,800,000 | ' | ' |
Options outstanding, Weighted-Average Remaining Contractual Life | '3 years 6 months | ' | ' |
Options exercisable, Number of Options Exercisable | ' | 698 | ' |
Options exercisable, Weighted-Average Exercise Price | ' | $8.03 | ' |
Options exercisable, aggregate intrinsic value | ' | 2,400,000 | ' |
Options exercisable, Weighted average remaining contractual term | ' | '2 years 5 months 1 day | ' |
Vested and expected to vest | ' | ' | 991 |
Vested and expected to vest, Weighted Average Exercise Price | ' | ' | $6.73 |
Vested and expected to vest, Aggregate Intrinsic Value | ' | ' | 3,800,000 |
Vested and expected to vest, remaining contractual term (in years) | ' | ' | '3 years 6 months |
General and administrative | 454,000 | 630,000 | 306,000 |
Weighted average grant-date fair value of stock options granted | $4.37 | $1.89 | $1.86 |
Stock Options [Member] | ' | ' | ' |
Stock Option Activity and Weighted-Average Exercise Price | ' | ' | ' |
General and administrative | 337,000 | 355,000 | 26,000 |
Compensation expense for unvested stock options | $500,000 | ' | ' |
Weighted average period for unvested stock options | '1 year 6 months | ' | ' |
Stockholders_Equity_Stockbased
Stockholders' Equity - Stock-based Compensation (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
General and administrative | $454 | $630 | $306 |
Stock Options [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
General and administrative | 337 | 355 | 26 |
Restricted Stock Units [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
General and administrative | 54 | 188 | 150 |
Performance Stock Units [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
General and administrative | $63 | $87 | $130 |
Stockholders_Equity_Restricted
Stockholders' Equity - Restricted Stock Units (Details) (Restricted Stock Units [Member], USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Restricted Stock Units [Member] | ' |
Restricted Stock Units Activity and Outstanding | ' |
Stock units outstanding | 179,000 |
Granted | 34,000 |
Forfeited | -2,000 |
Vested | -72,000 |
Stock units outstanding | 139,000 |
Restricted Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ' |
Stock units outstanding, Weighted Average Grant Date Fair Value | $2.60 |
Granted, Weighted Average Grant Date Fair Value | $6.62 |
Forfeited, Weighted Average Grant Date Fair Value | $0 |
Vested, Weighted Average Grant Date Fair Value | $2.60 |
Stock units outstanding, Weighted Average Grant Date Fair Value | $3.58 |
Stockholders_Equity_Performanc
Stockholders' Equity - Performance Stock Units (Details) (USD $) | 12 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 7 Months Ended | 1 Months Ended | 7 Months Ended | ||
Dec. 31, 2013 | Apr. 30, 2010 | 31-May-13 | Apr. 30, 2010 | Aug. 31, 2012 | 31-May-13 | Aug. 31, 2012 | 31-May-13 | Aug. 31, 2012 | |
Performance Shares [Member] | Key Executive Employees Member [Member] | Key Executive Employees Member [Member] | Key Executive Employees Member [Member] | Key Executive Employees Member [Member] | Minimum [Member] | Minimum [Member] | Maximum [Member] | Maximum [Member] | |
Performance Shares [Member] | Performance Shares [Member] | Performance Shares [Member] | |||||||
Performance Stock Units Activity and Outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock units outstanding | 132,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Granted | 25,000 | ' | 24,500 | 146,000 | 82,000 | ' | ' | ' | ' |
Forfeited, canceled or expired | -17,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Vested | -56,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock units outstanding | 84,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Performance Stock Units Activity and Weighted Average Grant Date Fair Value per Share | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock units outstanding, Weighted Average Grant Date Fair Value | $2.59 | ' | ' | ' | ' | ' | ' | ' | ' |
Granted, Weighted Average Grant Date Fair Value | $6.62 | ' | ' | ' | ' | ' | ' | ' | ' |
Forfeited, Canceled, or Expired, Weighted Average Grant Date Fair Value per Share | $3.56 | ' | ' | ' | ' | ' | ' | ' | ' |
Vested, Weighted Average Grant Date Fair Value | $2.32 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock units outstanding, Weighted Average Grant Date Fair Value | $3.76 | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period | ' | '3 years | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Percentage of Award Able to Vest | ' | ' | ' | ' | ' | 60.00% | 60.00% | 150.00% | 150.00% |
Stockholders_Equity_Stock_Comp
Stockholders' Equity Stock Compensation, Other (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Weighted average grant-date fair value of stock options granted | $4.37 | $1.89 | $1.86 |
Total intrinsic value of stock options exercised | $451,000 | $33,000 | $2,000 |
Restricted Stock Units [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Fair value of units vested | 545 | 405 | 0 |
Performance Shares [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Fair value of units vested | $386 | $0 | $0 |
Stockholders_Equity_Fair_Value
Stockholders' Equity Fair Value Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Equity [Abstract] | ' | ' | ' |
Dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 0.90% | 0.90% | 1.50% |
Expected life (years) | '4 years 9 months | '4 years 9 months | '4 years 9 months |
Expected volatility | 89.00% | 92.00% | 92.00% |
Income_Loss_Per_Share_Details
Income (Loss) Per Share (Details) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income per share: | ' | ' | ' |
Basic weighted average shares outstanding | 31,072 | 30,851 | 30,746 |
Dilutive potential common shares | 385 | 123 | 30 |
Diluted weighted average shares outstanding | 31,457 | 30,974 | 30,776 |
Stock Options [Member] | ' | ' | ' |
Income per share: | ' | ' | ' |
Anti-dilutive securities excluded from computation of diluted income per share | 304 | 1,072 | 1,114 |
Performance Stock Units [Member] | ' | ' | ' |
Income per share: | ' | ' | ' |
Anti-dilutive securities excluded from computation of diluted income per share | 12 | 26 | 89 |
Restricted Stock Units [Member] | ' | ' | ' |
Income per share: | ' | ' | ' |
Anti-dilutive securities excluded from computation of diluted income per share | 0 | 0 | 217 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
segment | ||||||||||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Reportable Segments | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Net sales | $77,091 | $46,256 | $36,242 | $59,214 | $65,029 | $38,052 | $39,583 | $51,262 | ' | $218,803 | $193,926 | $180,412 |
Consolidated contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,922 | 25,391 | 17,203 |
Operating Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | 90,753 | 80,449 | 74,860 |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Selling and marketing | ' | ' | ' | ' | ' | ' | ' | ' | ' | 66,486 | 58,617 | 54,494 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 32,085 | 226 | -686 |
Income from continuing operations | 8,432 | 1,500 | 32,668 | 5,524 | 7,265 | 1,216 | -486 | 2,647 | ' | 48,124 | 10,642 | 2,501 |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,344 | 3,269 | 3,815 |
Assets | 143,567 | ' | ' | ' | 94,311 | ' | ' | ' | ' | 143,567 | 94,311 | ' |
UNITED STATES | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 181,381 | 167,504 | 163,828 |
CANADA | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 34,166 | 24,977 | 15,834 |
All Other | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,256 | 1,445 | 750 |
Direct [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 136,663 | 124,978 | 107,061 |
Consolidated contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,126 | 12,479 | 2,954 |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,956 | 2,366 | 2,742 |
Assets | 21,249 | ' | ' | ' | 22,349 | ' | ' | ' | ' | 21,249 | 22,349 | ' |
Retail [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 76,775 | 63,891 | 68,591 |
Consolidated contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | 11,431 | 7,855 | 9,489 |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 642 | 825 | 844 |
Assets | 32,023 | ' | ' | ' | 27,843 | ' | ' | ' | ' | 32,023 | 27,843 | ' |
Unallocated royalty income [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net sales | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,365 | 5,057 | 4,760 |
Consolidated contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,365 | 5,057 | 4,760 |
Unallocated corporate [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Depreciation and amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | 746 | 78 | 229 |
Assets | 90,295 | ' | ' | ' | 44,119 | ' | ' | ' | ' | 90,295 | 44,119 | ' |
Less expenses not directly related to segments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating Expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | -15,198 | -14,801 | -13,604 |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income (expense), net | ' | ' | ' | ' | ' | ' | ' | ' | ' | 315 | -174 | -412 |
Income tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ($32,085) | ($226) | $686 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' | ' |
Rent expense under all operating leases | $3,473,000 | $3,252,000 | $3,218,000 | ' |
Standy by letters of credit with certain vendors | 500,000 | ' | ' | ' |
Non-cancelable market-based purchase obligation | 8,800,000 | ' | ' | ' |
Estimated future warranty cost | $1,638,000 | $2,492,000 | $2,017,000 | $3,935,000 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Operating Lease (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expense under all operating leases | $3,473 | $3,252 | $3,218 |
2014 | 3,343 | ' | ' |
2015 | 3,257 | ' | ' |
2016 | 3,196 | ' | ' |
2017 | 2,160 | ' | ' |
2018 | 996 | ' | ' |
Thereafter | 664 | ' | ' |
Total minimum non-cancelable lease payments, net | $13,616 | ' | ' |
Supplementary_Information_Quar2
Supplementary Information - Quarterly Results of Operations (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |||||||||||
Quarterly Financial Information Disclosure [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ||||||||||
Net sales | $77,091,000 | $46,256,000 | $36,242,000 | $59,214,000 | $65,029,000 | $38,052,000 | $39,583,000 | $51,262,000 | $218,803,000 | $193,926,000 | $180,412,000 | ||||||||||
Gross profit | 36,677,000 | 21,777,000 | 17,329,000 | 30,694,000 | 31,423,000 | 18,541,000 | 17,168,000 | 23,905,000 | 106,477,000 | 91,037,000 | 78,459,000 | ||||||||||
Operating income (loss) | 10,118,000 | 1,336,000 | -1,724,000 | 5,994,000 | 7,660,000 | 698,000 | -599,000 | 2,829,000 | 15,724,000 | 10,588,000 | 3,599,000 | ||||||||||
Income from continuing operations | 8,432,000 | 1,500,000 | 32,668,000 | 5,524,000 | 7,265,000 | 1,216,000 | -486,000 | 2,647,000 | 48,124,000 | 10,642,000 | 2,501,000 | ||||||||||
Income (loss) from discontinued operation | 116,000 | -116,000 | 195,000 | -365,000 | 6,309,000 | -265,000 | 322,000 | -125,000 | -170,000 | 6,241,000 | -1,081,000 | ||||||||||
Net income | 8,548,000 | [1] | 1,384,000 | [1] | 32,863,000 | [1] | 5,159,000 | [1] | 13,574,000 | [2] | 951,000 | [2] | -164,000 | [2] | 2,522,000 | [2] | 47,954,000 | [1] | 16,883,000 | [2] | 1,420,000 |
Basic | $0.27 | $0.04 | $1.06 | $0.17 | $0.44 | $0.03 | ($0.01) | $0.08 | $1.54 | $0.55 | $0.05 | ||||||||||
Diluted | $0.27 | $0.04 | $1.05 | $0.17 | $0.44 | $0.03 | ($0.01) | $0.08 | $1.52 | $0.55 | $0.05 | ||||||||||
Income tax benefit due to reduction of existing valuation allowance | ' | ' | 35,800,000 | ' | ' | ' | ' | ' | 38,900,000 | ' | ' | ||||||||||
Reclassification of foreign currency translation gains to income upon substantial liquidation of subsidiaries | ' | ' | ' | ' | $6,200,000 | ' | ' | ' | ' | ' | ' | ||||||||||
[1] | Net income in the quarter ended June 30, 2013 included a $35.8 million credit related to the reversal of our deferred tax asset valuation allowance. | ||||||||||||||||||||
[2] | Net income in the quarter ended December 31, 2012 included $6.2 million currency translation adjustment gain related to the liquidation of European subsidiaries. |