Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 30, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NAUTILUS, INC. | |
Entity Central Index Key | 1,078,207 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 30,711,598 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 27,760 | $ 47,874 |
Available-for-sale securities | 61,053 | 31,743 |
Trade receivables, net of allowances of $136 and $170 | 24,870 | 45,458 |
Inventories | 34,295 | 47,030 |
Prepaids and other current assets | 6,986 | 8,020 |
Income taxes receivable | 1,707 | 3,231 |
Total current assets | 156,671 | 183,356 |
Property, plant and equipment, net | 16,718 | 17,468 |
Goodwill | 61,905 | 61,888 |
Other intangible assets, net | 68,983 | 69,800 |
Deferred income tax assets, non-current | 0 | 11 |
Other assets | 513 | 543 |
Total assets | 304,790 | 333,066 |
Liabilities and Shareholders' Equity | ||
Trade payables | 39,408 | 66,020 |
Accrued liabilities | 12,162 | 12,892 |
Warranty obligations, current portion | 3,040 | 3,500 |
Note payable, current portion, net of unamortized debt issuance costs of $7 and $7 | 15,993 | 15,993 |
Total current liabilities | 70,603 | 98,405 |
Warranty obligations, non-current | 3,952 | 3,950 |
Income taxes payable, non-current | 2,520 | 2,403 |
Deferred income tax liabilities, non-current | 16,613 | 16,991 |
Other long-term liabilities | 2,419 | 2,481 |
Note payable, non-current, net of unamortized debt issuance costs of $19 and $21 | 43,984 | 47,979 |
Total liabilities | 140,091 | 172,209 |
Commitments and contingencies (Note 14) | ||
Shareholders' equity: | ||
Common stock - no par value, 75,000 shares authorized, 30,712 and 30,825 shares issued and outstanding | 506 | 578 |
Retained earnings | 165,239 | 161,496 |
Accumulated other comprehensive loss | (1,046) | (1,217) |
Total shareholders' equity | 164,699 | 160,857 |
Total liabilities and shareholders' equity | $ 304,790 | $ 333,066 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful trade receivables | $ 136 | $ 170 |
Unamortized debt issuance costs, current | 7 | 7 |
Unamortized debt issuance costs, long-term | $ 19 | $ 21 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 30,712,000 | 30,825,000 |
Common stock, shares outstanding | 30,712,000 | 30,825,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Income Statement [Abstract] | |||
Net sales | $ 113,252 | $ 120,928 | |
Cost of sales | 51,507 | 54,584 | |
Gross profit | 61,745 | 66,344 | |
Operating expenses: | |||
Selling and marketing | 37,665 | 35,179 | |
General and administrative | 7,486 | 8,231 | |
Research and development | 3,911 | 3,634 | |
Total operating expenses | 49,062 | 47,044 | |
Operating income | 12,683 | 19,300 | |
Other income (expense): | |||
Interest income | 131 | 54 | |
Interest expense | (444) | (466) | |
Other, net | (47) | (124) | |
Total other income (expense), net | (360) | (536) | |
Income from continuing operations before income taxes | 12,323 | 18,764 | |
Income tax expense | 4,138 | 7,178 | |
Income from continuing operations | 8,185 | 11,586 | |
Discontinued operations: | |||
Loss from discontinued operations before income taxes | (1,626) | (124) | |
Income tax expense (benefit) of discontinued operations | (534) | 18 | |
Loss from discontinued operations | (1,092) | (142) | |
Net income | $ 7,093 | $ 11,444 | |
Earnings Per Share, Basic [Abstract] | |||
Basic income per share from continuing operations (in dollars per share) | $ 0.27 | $ 0.37 | |
Basic loss per share from discontinued operation (in dollars per share) | (0.04) | 0 | |
Basic net income per share (in dollars per share) | 0.23 | 0.37 | |
Earnings Per Share, Diluted [Abstract] | |||
Diluted income per share from continuing operations (in dollars per share) | 0.26 | 0.37 | |
Diluted loss per share from discontinued operation (in dollars per share) | (0.04) | 0 | |
Diluted net income per share (in dollars per share) | [1] | $ 0.23 | $ 0.37 |
Shares used in per share calculations: | |||
Basic (in shares) | 30,713 | 31,016 | |
Diluted (in shares) | 31,127 | 31,295 | |
[1] | May not add due to rounding. |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 7,093 | $ 11,444 |
Other comprehensive income (loss): | ||
Unrealized gain (loss) on available-for-sale securities, net of income tax expense (benefit) of $(12) and $12 | (19) | 18 |
Gain (loss) on derivative securities, effective portion, net of income tax expense (benefit) of $72 and $(413) | 119 | (682) |
Foreign currency translation, net of income tax benefit of $0 and $(7) | 71 | 552 |
Net other comprehensive income (loss) during period | 171 | (112) |
Comprehensive income | $ 7,264 | $ 11,332 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized gain (loss) on marketable securities, tax (benefit) expense | $ (12) | $ 12 |
Gain (loss) on derivatives, tax (benefit) expense | 72 | (413) |
Foreign currency translation, tax (benefit) expense | $ 0 | $ (7) |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Income from continuing operations | $ 8,185 | $ 11,586 |
Loss from discontinued operations | (1,092) | (142) |
Net income | 7,093 | 11,444 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation and amortization | 2,244 | 1,935 |
Provision for allowance for doubtful accounts | 83 | 97 |
Inventory lower-of-cost-and-net-realizable-value adjustments | 95 | 0 |
Stock-based compensation expense | 625 | 701 |
Loss on asset dispositions | 0 | 10 |
Deferred income taxes, net of valuation allowance | (435) | 5,342 |
Excess tax benefit related to stock-based awards | 0 | (1,514) |
Other | 5 | 0 |
Changes in operating assets and liabilities: | ||
Trade receivables | 20,471 | 20,540 |
Inventories | 12,564 | 7,366 |
Prepaids and other current assets | 1,060 | (1,028) |
Income taxes receivable | 1,524 | (3,406) |
Trade payables | (27,232) | (20,949) |
Accrued liabilities, including warranty obligations | (1,077) | (1,854) |
Net cash provided by operating activities | 17,020 | 18,684 |
Cash flows from investing activities: | ||
Purchases of available-for-sale securities | (36,665) | (9,112) |
Proceeds from maturities of available-for-sale securities | 7,355 | 10,323 |
Acquisition of business, net of cash acquired | 0 | 3,469 |
Purchases of property, plant and equipment and intangible assets | (45) | (787) |
Net cash used in investing activities | (29,355) | (3,045) |
Cash flows from financing activities: | ||
Payments on long-term debt | (4,000) | (4,000) |
Payments for stock repurchases | (3,427) | 0 |
Proceeds from exercise of stock options | 120 | 35 |
Tax payments related to stock award issuances | (741) | (221) |
Excess tax benefit related to stock-based awards | 0 | 1,514 |
Net cash used in financing activities | (8,048) | (2,672) |
Effect of exchange rate changes on cash and cash equivalents | 269 | 282 |
Increase (decrease) in cash and cash equivalents | (20,114) | 13,249 |
Cash and cash equivalents: | ||
Beginning of period | 47,874 | 30,778 |
End of period | 27,760 | 44,027 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 446 | 466 |
Cash paid for income taxes, net | 2,332 | 4,705 |
Supplemental disclosure of non-cash investing activities: | ||
Capital expenditures incurred but not yet paid | $ 590 | $ 281 |
General Information
General Information | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General Information | GENERAL INFORMATION Basis of Consolidation and Presentation The accompanying condensed consolidated financial statements present the financial position, results of operations and cash flows of Nautilus, Inc. and its subsidiaries, all of which are wholly owned. Intercompany transactions and balances have been eliminated in consolidation. The accompanying condensed consolidated financial statements have not been audited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes the disclosures contained herein are adequate to make the information presented not misleading. However, these condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2016 (the “ 2016 Form 10-K”). 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 and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Further information regarding significant estimates can be found in our 2016 Form 10-K. In the opinion of management, the accompanying condensed consolidated financial statements reflect all adjustments necessary to present fairly our financial position as of March 31, 2017 and December 31, 2016 , and our results of operations and comprehensive income for the three months ended March 31, 2017 and 2016 , and cash flows for the three months ended March 31, 2017 and 2016 . Interim results are not necessarily indicative of results for a full year. Our revenues typically vary seasonally and this seasonality can have a significant effect on operating results, inventory levels and working capital needs. Unless indicated otherwise, all information regarding our operating results pertain to our continuing operations. New Accounting Pronouncements ASU 2017-04 In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-04, "Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment". ASU 2017-04 simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. An entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, if applicable. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The same impairment test also applies to any reporting unit with a zero or negative carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary.ASU 2017-04 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2019, on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. We do not expect the adoption of ASU 2017-04 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-15 In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments." The amendments in ASU 2016-15 are intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows, with the intent of reducing diversity in practice for the eight (8) types of cash flows identified. ASU 2016-15 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented, but may apply it prospectively if retrospective application would be impracticable. We do not expect the adoption of ASU 2016-15 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments." The amendments in ASU 2016-13 replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2019, using a modified-retrospective approach, with certain exceptions. Early adoption is permitted. While we do not expect the adoption of ASU 2016-13 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-13 may have on our financial position, results of operations or cash flows. ASU 2016-12 In May 2016, the FASB issued ASU 2016-12, "Revenue from Contracts with Customers (Topic 606) - Narrow-Scope Improvements and Practical Expedients." ASU 2016-12 clarifies aspects of Topic 606 related to assessing collectibility, presentation of sales taxes, non-cash consideration, and completed contracts and contract modifications at transition, while retaining the related core principles for those areas. The effective date and transition requirements for ASU 2016-12 are the same as the effective date and transition requirements for Topic 606 (ASU 2014-09). While we do not expect the adoption of ASU 2016-12 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-12 may have on our financial position, results of operations or cash flows. ASU 2016-10 In April 2016, the FASB issued ASU 2016-10, "Revenue from Contracts with Customers (Topic 606) - Identifying Performance Obligations and Licensing." ASU 2016-10 clarifies aspects of Topic 606 related to identifying performance obligations and the licensing implementation guidance, while retaining the related core principles for those areas. The effective date and transition requirements for ASU 2016-10 are the same as the effective date and transition requirements for Topic 606 (ASU 2014-09). While we do not expect the adoption of ASU 2016-10 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-10 may have on our financial position, results of operations or cash flows. ASU 2016-09 In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted subject to certain requirements, and the method of application (i.e., retrospective, modified retrospective or prospective) depends on the transaction area that is being amended. Related to forfeitures, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date". We applied the guidance on a modified retrospective basis, which resulted in a cumulative effective adjustment (in thousands) of $28 reduction to beginning retained earnings. In addition, related to excess tax benefits, we recognized all current period expense through the statement of operations and presented excess tax benefits as an operating cash flow, applied prospectively, with no adjustment to prior periods. The adoption of ASU 2016-09 in January 2017 did not have a material impact on our financial position, results of operations or cash flows. ASU 2016-02 In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 replaces the existing guidance in Accounting Standards Codification ("ASC") 840, Leases. The new standard would require companies and other organizations to include lease obligations on their balance sheets, including a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use ("ROU") asset and a corresponding lease liability. For finance leases the lessee would recognize interest expense and amortization of the ROU asset, and for operating leases the lessee would recognize a straight-line total lease expense. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is effective for public companies' annual periods, and interim periods within those fiscal years, beginning after December 15, 2018. We are currently evaluating any potential impact that adoption of ASU 2016-02 may have on our financial position, results of operations and cash flows. ASU 2015-11 In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out (“LIFO”) method by prescribing inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. Early adoption is permitted. Our adoption of ASU 2015-11 in January 2017 did not have a material effect on our financial position, results of operations or cash flows. ASU 2014-09 In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers." ASU 2014-09 replaces most existing revenue recognition guidance, and requires companies to recognize revenue based upon the transfer of promised goods and/or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and/or services. In addition, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. ASU 2014-09 is effective, as amended, for annual and interim periods beginning on or after December 15, 2017, applied retrospectively to each prior period presented or retrospectively with a cumulative effect adjustment recognized as of the adoption date. We expect to adopt the new standard on January 1, 2018, and have not yet selected a transition method. We are currently evaluating the overall impact this guidance will have on our consolidated financial statements. Based on our preliminary assessment, we do not expect the adoption of ASU 2014-09 to materially change the timing of revenue recognition and classification of transactions within our consolidated financial statements. We are, however, continuing our assessment, which may identify potential impacts. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | DISCONTINUED OPERATIONS There was no revenue related to discontinued operations for the three months ended March 31, 2017 or the year ended December 31, 2016 . However, we continue to have legal and accounting expenses as we work with authorities on final deregistration of certain foreign entities and product liability expenses associated with product previously sold into the Commercial channel. During the first quarter of 2017, our litigation with Biosig Instruments, Inc. ("Biosig") was settled. The litigation began in 2004 and alleged patent infringement in connection with our incorporation of heart rate monitors into certain cardio products of our former Commercial business. We paid Biosig $1.2 million under the settlement, and the matter was dismissed with prejudice. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Factors used in determining the fair value of financial assets and liabilities are summarized into three broad categories: • Level 1 - observable inputs such as quoted prices (unadjusted) in active liquid markets for identical securities as of the reporting date; • Level 2 - other significant directly or indirectly observable inputs, including quoted prices for similar securities, interest rates, prepayment speeds and credit risk; or observable market prices in markets with insufficient volume and/or infrequent transactions; and • Level 3 - significant inputs that are generally unobservable inputs for which there is little or no market data available, including our own assumptions in determining fair value. Assets and liabilities measured at fair value on a recurring basis as of March 31, 2017 and December 31, 2016 were as follows (in thousands): March 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 5,229 $ — $ — $ 5,229 Commercial paper — 2,996 — 2,996 Total cash equivalents 5,229 2,996 — 8,225 Available-for-Sale Securities Certificates of deposit (1) — 21,097 — 21,097 Commercial paper — 15,931 — 15,931 Corporate bonds — 15,019 — 15,019 U.S. government bonds — 9,006 — 9,006 Total available-for-sale securities — 61,053 — 61,053 Derivatives Interest rate swap contract — 152 — 152 Total assets measured at fair value $ 5,229 $ 64,201 $ — $ 69,430 December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,635 $ — $ — $ 9,635 Commercial paper — 3,999 — 3,999 Total cash equivalents 9,635 3,999 — 13,634 Available-for-Sale Securities Certificates of deposit (1) — 22,820 — 22,820 Corporate bonds — 6,922 — 6,922 U.S. government bonds — 2,001 — 2,001 Total available-for-sale securities — 31,743 — 31,743 Total assets measured at fair value $ 9,635 $ 35,742 $ — $ 45,377 Liabilities: Derivatives Interest rate swap contract $ — $ (38 ) $ — $ (38 ) Total liabilities measured at fair value $ — $ (38 ) $ — $ (38 ) (1) All certificates of deposit are within current FDIC insurance limits. For our assets measured at fair value on a recurring basis, we recognize transfers between levels at the actual date of the event or change in circumstance that caused the transfer. There were no transfers between levels during the three months ended March 31, 2017 , nor for the year ended December 31, 2016 . We did not have any changes to our valuation techniques during the three months ended March 31, 2017 , nor for the year ended December 31, 2016 . We classify our marketable securities as available-for-sale and, accordingly, record them at fair value. Level 1 investment valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 investment valuations are obtained from inputs, other than quoted market prices in active markets for identical assets, that are directly or indirectly observable in the marketplace and quoted prices in markets with limited volume or infrequent transactions. The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Unrealized holding gains and losses are excluded from earnings and are reported net of tax in comprehensive income until realized. The fair value of our interest rate swap contract is calculated as the present value of estimated future cash flows using discount factors derived from relevant Level 2 market inputs, including forward curves and volatility levels. We recognize or disclose the fair value of certain assets, such as non-financial assets, primarily property, plant and equipment, goodwill, other intangible assets and certain other long-lived assets in connection with impairment evaluations. All of our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy. We did not perform any valuations on assets or liabilities that are valued at fair value on a nonrecurring basis during the first three months of 2017 . During the fourth quarter of 2016 , we performed our annual goodwill and indefinite-lived trade names impairment analyses effective as of October 1, 2016 . During the three months ended March 31, 2017 and the year ended December 31, 2016 , we did not record any other-than-temporary impairments on our financial assets required to be measured at fair value on a nonrecurring basis. The carrying values of cash and cash equivalents, trade receivables, prepaids and other current assets, trade payables and accrued liabilities approximate fair value due to their short maturities. The carrying value of our term loan approximates its fair value and falls under Level 2 of the fair value hierarchy, as the interest rate is variable and based on current market rates. |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | DERIVATIVES From time to time, we enter into interest rate swaps to fix a portion of our interest expense. We do not enter into derivative instruments for any purpose other than to manage interest rate exposure to fluctuations in the one-month LIBOR benchmark. That is, we do not engage in interest rate speculation using derivative instruments. As of March 31, 2017 , we had a $60.0 million interest rate swap outstanding with JPMorgan Chase Bank, N.A. This interest rate swap matures on December 31, 2020 and has a fixed rate of 1.42% per annum. The variable rate on the interest rate swap is the one-month LIBOR benchmark. At March 31, 2017 , the one-month LIBOR rate was 0.78% . We typically designate all interest rate swaps as cash flow hedges and, accordingly, record the change in fair value for the effective portion of these interest rate swaps in accumulated other comprehensive income rather than current period earnings until the underlying hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. For the three months ended March 31, 2017 , there was no ineffectiveness. As of March 31, 2017 , we expect to reclassify a gain of $0.2 million from accumulated other comprehensive income to earnings within the next twelve months. The fair value of our derivative instruments was included in our condensed consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of March 31, 2017 December 31, 2016 Derivatives instruments designated as cash flow hedges: Interest rate swap contract Prepaids and other current assets $ 152 $ — Accrued liabilities — 38 $ 152 $ 38 The effect of derivative instruments on our condensed consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Three Months Ended March 31, 2017 2016 Derivatives instruments designated as cash flow hedges: Gain (loss) recognized in other comprehensive income before reclassifications --- $ 51 $ (761 ) Loss reclassified from accumulated other comprehensive income to earnings for the effective portion Interest expense $ (102 ) $ (128 ) Income tax benefit Income tax expense $ 34 $ 49 For additional information related to our derivatives, see Notes 3 and 10. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories are stated at the lower of cost and net realizable value, with cost determined based on the first-in, first-out method. Our inventories consisted of the following (in thousands): As of March 31, 2017 December 31, 2016 Finished goods $ 30,314 $ 43,130 Parts and components 3,981 3,900 Total inventories $ 34,295 $ 47,030 |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consisted of the following (in thousands): Estimated Useful Life (in years) As of March 31, 2017 December 31, 2016 Automobiles 5 to 6 $ 139 $ 139 Leasehold improvements 4 to 20 3,426 3,388 Computer software and equipment 3 to 7 25,920 25,899 Machinery and equipment 3 to 5 13,769 13,085 Furniture and fixtures 5 to 20 2,238 2,238 Work in progress (1) N/A 505 768 Total cost 45,997 45,517 Accumulated depreciation (29,279 ) (28,049 ) Total property, plant and equipment, net $ 16,718 $ 17,468 (1) Work in progress includes production tooling and computer software. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill The rollforward of goodwill was as follows (in thousands): Direct Retail Total Balance, January 1, 2016 $ 2,113 $ 58,357 $ 60,470 Currency exchange rate adjustment 67 3 70 Business acquisition - measurement period adjustments — 1,348 1,348 Balance, December 31, 2016 2,180 59,708 61,888 Currency exchange rate adjustment 18 (1 ) 17 Balance, March 31, 2017 $ 2,198 $ 59,707 $ 61,905 Other Intangible Assets Other intangible assets consisted of the following (in thousands): Estimated Useful Life (in years) As of March 31, 2017 December 31, 2016 Indefinite-lived trademarks N/A $ 32,052 $ 32,052 Definite-lived trademarks 10 to 15 2,600 2,600 Patents 8 to 24 31,487 31,487 Customer relationships 10 to 15 24,700 24,700 90,839 90,839 Accumulated amortization - definite-lived intangible assets (21,856 ) (21,039 ) Other intangible assets, net $ 68,983 $ 69,800 Amortization expense was as follows (in thousands): Three Months Ended March 31, 2017 2016 Amortization expense $ 817 $ 960 Future amortization of definite-lived intangible assets is as follows (in thousands): Remainder of 2017 $ 2,439 2018 3,164 2019 3,134 2020 3,108 2021 3,078 Thereafter 22,008 $ 36,931 |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | ACCRUED LIABILITIES Accrued liabilities consisted of the following (in thousands): As of March 31, 2017 December 31, 2016 Payroll and related liabilities $ 3,105 $ 4,579 Royalties 3,615 3,172 Other 5,442 5,141 Total accrued liabilities $ 12,162 $ 12,892 |
Product Warranties
Product Warranties | 3 Months Ended |
Mar. 31, 2017 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | PRODUCT WARRANTIES Our products carry 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 thirty 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. Changes in our product warranty obligations were as follows (in thousands): Three Months Ended March 31, 2017 2016 Balance, beginning of period $ 7,450 $ 8,545 Accruals 803 1,530 Payments (1,261 ) (1,363 ) Balance, end of period $ 6,992 $ 8,712 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables set forth the changes in accumulated other comprehensive income (loss), net of tax (in thousands) for the periods presented: Unrealized Loss on Available-for-Sale Securities Gain (Loss) on Derivative Securities (Effective Portion) Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) Balance, January 1, 2017 $ (8 ) $ (24 ) $ (1,185 ) $ (1,217 ) Current period other comprehensive income (loss) before reclassifications (19 ) 51 71 103 Reclassification of amounts to earnings — 68 — 68 Net other comprehensive income (loss) during period (19 ) 119 71 171 Balance, March 31, 2017 $ (27 ) $ 95 $ (1,114 ) $ (1,046 ) Unrealized Gain (Loss) on Available-for-Sale Securities Loss on Derivative Securities (Effective Portion) Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, January 1, 2016 $ (16 ) $ — $ (1,311 ) $ (1,327 ) Current period other comprehensive income (loss) before reclassifications 18 (761 ) 552 (191 ) Reclassification of amounts to earnings — 79 — 79 Net other comprehensive income (loss) during period 18 (682 ) 552 (112 ) Balance, March 31, 2016 $ 2 $ (682 ) $ (759 ) $ (1,439 ) |
Stock Repurchase Program
Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Stock Repurchase Program | STOCK REPURCHASE PROGRAM On May 4, 2016 , our Board of Directors authorized the repurchase of up to $10.0 million of our outstanding common stock from time to time during the period of 24 months following such approval. Repurchases may be made in open market transactions at prevailing prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases are funded from existing cash balances, and the repurchased shares are retired and returned to unissued authorized shares. The repurchase program expires on May 4, 2018 . As of March 31, 2017 , there was $4.6 million remaining available for repurchases under the $10.0 million share repurchase program. Cumulative repurchases pursuant to the program are as follows: Quarter Ended Number of Shares Repurchased Amount Average Price Per Share December 31, 2016 120,996 $1,957,882 $16.18 March 31, 2017 218,515 3,426,959 15.68 Totals-to-Date 339,511 $5,384,841 $15.86 |
Income Per Share
Income Per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Income Per Share | 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. The weighted average numbers of shares outstanding used to compute income per share were as follows (in thousands): Three Months Ended March 31, 2017 2016 Shares used to calculate basic income per share 30,713 31,016 Dilutive effect of outstanding stock options, performance stock units and restricted stock units 414 279 Shares used to calculate diluted income per share 31,127 31,295 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. In the case of stock options, this is because the average market price did not exceed the exercise price. In the case of restricted stock units, this is because unrecognized compensation expense exceeds the current value of the awards (i.e., grant date market value was higher than current average market price). These shares may be dilutive potential common shares in the future (in thousands): Three Months Ended March 31, 2017 2016 Stock options 14 11 Restricted stock units 15 — |
Segment and Enterprise-wide Inf
Segment and Enterprise-wide Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment and Enterprise-wide Information | SEGMENT AND ENTERPRISE-WIDE INFORMATION In accordance with FASB ASC 280, Segment Reporting , we determined that we have two operating segments as of December 31, 2016 - Direct and Retail. There have been no changes in our operating segments during the three months ended March 31, 2017 . We evaluate performance using several factors, of which the primary financial measures are net sales and reportable segment contribution. 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, goodwill and other intangible assets. Unallocated assets primarily include cash and cash equivalents, available-for-sale securities, derivative securities, 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): Three Months Ended March 31, 2017 2016 Net sales: Direct $ 74,703 $ 81,234 Retail 37,805 38,805 Royalty 744 889 Consolidated net sales $ 113,252 $ 120,928 Contribution: Direct $ 15,333 $ 21,144 Retail 2,212 3,944 Royalty 733 870 Consolidated contribution $ 18,278 $ 25,958 Reconciliation of consolidated contribution to income from continuing operations: Consolidated contribution $ 18,278 $ 25,958 Amounts not directly related to segments: Operating expenses (5,595 ) (6,658 ) Other income (expense), net (360 ) (536 ) Income tax expense (4,138 ) (7,178 ) Income from continuing operations $ 8,185 $ 11,586 There was no material change in the allocation of assets by segment during the first three months of 2017 and, accordingly, assets by segment are not presented. For the three months ended March 31, 2017 and 2016 , no customer represented 10.0% or more of total net sales. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Guarantees, Commitments and Off-Balance Sheet Arrangements As of March 31, 2017 , we had no standby letters of credit. We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of March 31, 2017 , we had approximately $26.6 million in noncancelable 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 March 31, 2017 . Legal Matters In 2004, we were sued in the Southern District of New York by Biosig Instruments, Inc. for alleged patent infringement in connection with our incorporation of heart rate monitors into certain cardio products. No significant activity in the litigation occurred until 2008. In 2012, the U.S. District Court granted summary judgment to us on grounds that Biosig’s patents were invalid as a matter of law. Biosig appealed the grant of summary judgment and, in April 2013, the U.S. Court of Appeals for the Federal Circuit reversed the District Court’s decision on summary judgment and remanded the case to the District Court for further proceedings. On January 10, 2014, the U. S. Supreme Court granted our petition for a writ of certiorari to address the legal standard applied by the Federal Circuit in determining whether the patents may be valid under applicable law. The case was argued before the Supreme Court on April 28, 2014. By decision dated June 2, 2014, the Supreme Court unanimously reversed the Federal Circuit, holding that its standard of when a patent may be “indefinite” was incorrect and remanding to the Federal Circuit for reconsideration under the correct standard. The remand hearing in the Federal Circuit was held on October 29, 2014. By decision dated April 27, 2015, the same panel of the Federal Circuit affirmed its earlier reversal of the District Court’s decision on summary judgment. On May 27, 2015, we filed a petition for a rehearing en banc in the Federal Circuit, which was denied on August 4, 2015 and a Petition for Review by the U. S. Supreme Court which was also denied. The case was then returned to the District Court. Pursuant to agreement of the parties, the litigation involving Biosig was settled effective as of March 28, 2017. We paid $1.2 million under the settlement, and the District Court dismissed the matter with prejudice. The settlement was recorded in discontinued operations. In addition to the matter described above, 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 which 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 March 31, 2017 . 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. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS On April 25, 2017 , our Board of Directors authorized an additional $15.0 million share repurchase program, bringing the total authorization under existing programs to $25.0 million . Under the new program, shares of our common stock may be repurchased from time to time through April 25, 2019 . Repurchases may be made in open market transactions at prevailing prices, in privately negotiated transactions, or by other means in accordance with federal securities laws. Share repurchases will be funded from existing cash balances, and repurchased shares will be retired and returned to unissued authorized shares. To date, we have not repurchased any shares under the new $15.0 million program. |
General Information (Policies)
General Information (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements ASU 2017-04 In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-04, "Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment". ASU 2017-04 simplifies the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. An entity should perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount, and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit's fair value, if applicable. The loss recognized should not exceed the total amount of goodwill allocated to the reporting unit. The same impairment test also applies to any reporting unit with a zero or negative carrying amount. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary.ASU 2017-04 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2019, on a prospective basis. Early adoption is permitted for interim or annual goodwill impairment tests performed after January 1, 2017. We do not expect the adoption of ASU 2017-04 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-15 In August 2016, the FASB issued ASU 2016-15, "Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments." The amendments in ASU 2016-15 are intended to add or clarify guidance on the classification of certain cash receipts and payments in the statement of cash flows, with the intent of reducing diversity in practice for the eight (8) types of cash flows identified. ASU 2016-15 is effective for public companies' fiscal years, including interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted. Entities must apply the guidance retrospectively to all periods presented, but may apply it prospectively if retrospective application would be impracticable. We do not expect the adoption of ASU 2016-15 to have a material effect on our financial position, results of operations or cash flows. ASU 2016-13 In June 2016, the FASB issued ASU 2016-13, "Financial Instruments - Credit Losses (Topic 326) - Measurement of Credit Losses on Financial Instruments." The amendments in ASU 2016-13 replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2019, using a modified-retrospective approach, with certain exceptions. Early adoption is permitted. While we do not expect the adoption of ASU 2016-13 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-13 may have on our financial position, results of operations or cash flows. ASU 2016-12 In May 2016, the FASB issued ASU 2016-12, "Revenue from Contracts with Customers (Topic 606) - Narrow-Scope Improvements and Practical Expedients." ASU 2016-12 clarifies aspects of Topic 606 related to assessing collectibility, presentation of sales taxes, non-cash consideration, and completed contracts and contract modifications at transition, while retaining the related core principles for those areas. The effective date and transition requirements for ASU 2016-12 are the same as the effective date and transition requirements for Topic 606 (ASU 2014-09). While we do not expect the adoption of ASU 2016-12 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-12 may have on our financial position, results of operations or cash flows. ASU 2016-10 In April 2016, the FASB issued ASU 2016-10, "Revenue from Contracts with Customers (Topic 606) - Identifying Performance Obligations and Licensing." ASU 2016-10 clarifies aspects of Topic 606 related to identifying performance obligations and the licensing implementation guidance, while retaining the related core principles for those areas. The effective date and transition requirements for ASU 2016-10 are the same as the effective date and transition requirements for Topic 606 (ASU 2014-09). While we do not expect the adoption of ASU 2016-10 to have a material effect on our business, we are evaluating any potential impact that adoption of ASU 2016-10 may have on our financial position, results of operations or cash flows. ASU 2016-09 In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted subject to certain requirements, and the method of application (i.e., retrospective, modified retrospective or prospective) depends on the transaction area that is being amended. Related to forfeitures, we changed our accounting treatment of forfeiture expense reversals from "at vest date" to "at forfeiture date". We applied the guidance on a modified retrospective basis, which resulted in a cumulative effective adjustment (in thousands) of $28 reduction to beginning retained earnings. In addition, related to excess tax benefits, we recognized all current period expense through the statement of operations and presented excess tax benefits as an operating cash flow, applied prospectively, with no adjustment to prior periods. The adoption of ASU 2016-09 in January 2017 did not have a material impact on our financial position, results of operations or cash flows. ASU 2016-02 In February 2016, the FASB issued ASU 2016-02, "Leases (Topic 842)." ASU 2016-02 replaces the existing guidance in Accounting Standards Codification ("ASC") 840, Leases. The new standard would require companies and other organizations to include lease obligations on their balance sheets, including a dual approach for lessee accounting under which a lessee would account for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use ("ROU") asset and a corresponding lease liability. For finance leases the lessee would recognize interest expense and amortization of the ROU asset, and for operating leases the lessee would recognize a straight-line total lease expense. Lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is effective for public companies' annual periods, and interim periods within those fiscal years, beginning after December 15, 2018. We are currently evaluating any potential impact that adoption of ASU 2016-02 may have on our financial position, results of operations and cash flows. ASU 2015-11 In July 2015, the FASB issued ASU 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” ASU 2015-11 simplifies the accounting for the valuation of all inventory not accounted for using the last-in, first-out (“LIFO”) method by prescribing inventory be valued at the lower of cost and net realizable value. ASU 2015-11 is effective for public companies' annual periods, including interim periods within those fiscal years, beginning after December 15, 2016 on a prospective basis. Early adoption is permitted. Our adoption of ASU 2015-11 in January 2017 did not have a material effect on our financial position, results of operations or cash flows. ASU 2014-09 In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers." ASU 2014-09 replaces most existing revenue recognition guidance, and requires companies to recognize revenue based upon the transfer of promised goods and/or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and/or services. In addition, the new guidance requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. ASU 2014-09 is effective, as amended, for annual and interim periods beginning on or after December 15, 2017, applied retrospectively to each prior period presented or retrospectively with a cumulative effect adjustment recognized as of the adoption date. We expect to adopt the new standard on January 1, 2018, and have not yet selected a transition method. We are currently evaluating the overall impact this guidance will have on our consolidated financial statements. Based on our preliminary assessment, we do not expect the adoption of ASU 2014-09 to materially change the timing of revenue recognition and classification of transactions within our consolidated financial statements. We are, however, continuing our assessment, which may identify potential impacts. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Assets measured at fair value on a recurring basis | Assets and liabilities measured at fair value on a recurring basis as of March 31, 2017 and December 31, 2016 were as follows (in thousands): March 31, 2017 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 5,229 $ — $ — $ 5,229 Commercial paper — 2,996 — 2,996 Total cash equivalents 5,229 2,996 — 8,225 Available-for-Sale Securities Certificates of deposit (1) — 21,097 — 21,097 Commercial paper — 15,931 — 15,931 Corporate bonds — 15,019 — 15,019 U.S. government bonds — 9,006 — 9,006 Total available-for-sale securities — 61,053 — 61,053 Derivatives Interest rate swap contract — 152 — 152 Total assets measured at fair value $ 5,229 $ 64,201 $ — $ 69,430 December 31, 2016 Level 1 Level 2 Level 3 Total Assets: Cash Equivalents Money market funds $ 9,635 $ — $ — $ 9,635 Commercial paper — 3,999 — 3,999 Total cash equivalents 9,635 3,999 — 13,634 Available-for-Sale Securities Certificates of deposit (1) — 22,820 — 22,820 Corporate bonds — 6,922 — 6,922 U.S. government bonds — 2,001 — 2,001 Total available-for-sale securities — 31,743 — 31,743 Total assets measured at fair value $ 9,635 $ 35,742 $ — $ 45,377 Liabilities: Derivatives Interest rate swap contract $ — $ (38 ) $ — $ (38 ) Total liabilities measured at fair value $ — $ (38 ) $ — $ (38 ) (1) All certificates of deposit are within current FDIC insurance limits. |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Liabilities at Fair Value | The fair value of our derivative instruments was included in our condensed consolidated balance sheets as follows (in thousands): Balance Sheet Classification As of March 31, 2017 December 31, 2016 Derivatives instruments designated as cash flow hedges: Interest rate swap contract Prepaids and other current assets $ 152 $ — Accrued liabilities — 38 $ 152 $ 38 |
Derivative Instruments, Gain (Loss) | The effect of derivative instruments on our condensed consolidated statements of operations was as follows (in thousands): Statement of Operations Classification Three Months Ended March 31, 2017 2016 Derivatives instruments designated as cash flow hedges: Gain (loss) recognized in other comprehensive income before reclassifications --- $ 51 $ (761 ) Loss reclassified from accumulated other comprehensive income to earnings for the effective portion Interest expense $ (102 ) $ (128 ) Income tax benefit Income tax expense $ 34 $ 49 For additional information related to our derivatives, see Notes 3 and 10. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net of Valuation Allowances | Our inventories consisted of the following (in thousands): As of March 31, 2017 December 31, 2016 Finished goods $ 30,314 $ 43,130 Parts and components 3,981 3,900 Total inventories $ 34,295 $ 47,030 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): Estimated Useful Life (in years) As of March 31, 2017 December 31, 2016 Automobiles 5 to 6 $ 139 $ 139 Leasehold improvements 4 to 20 3,426 3,388 Computer software and equipment 3 to 7 25,920 25,899 Machinery and equipment 3 to 5 13,769 13,085 Furniture and fixtures 5 to 20 2,238 2,238 Work in progress (1) N/A 505 768 Total cost 45,997 45,517 Accumulated depreciation (29,279 ) (28,049 ) Total property, plant and equipment, net $ 16,718 $ 17,468 (1) Work in progress includes production tooling and computer software. |
Goodwill and Other Intangible28
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Other Intangible Assets | The rollforward of goodwill was as follows (in thousands): Direct Retail Total Balance, January 1, 2016 $ 2,113 $ 58,357 $ 60,470 Currency exchange rate adjustment 67 3 70 Business acquisition - measurement period adjustments — 1,348 1,348 Balance, December 31, 2016 2,180 59,708 61,888 Currency exchange rate adjustment 18 (1 ) 17 Balance, March 31, 2017 $ 2,198 $ 59,707 $ 61,905 Other Intangible Assets Other intangible assets consisted of the following (in thousands): Estimated Useful Life (in years) As of March 31, 2017 December 31, 2016 Indefinite-lived trademarks N/A $ 32,052 $ 32,052 Definite-lived trademarks 10 to 15 2,600 2,600 Patents 8 to 24 31,487 31,487 Customer relationships 10 to 15 24,700 24,700 90,839 90,839 Accumulated amortization - definite-lived intangible assets (21,856 ) (21,039 ) Other intangible assets, net $ 68,983 $ 69,800 |
Amortization Expense | Amortization expense was as follows (in thousands): Three Months Ended March 31, 2017 2016 Amortization expense $ 817 $ 960 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Future amortization of definite-lived intangible assets is as follows (in thousands): Remainder of 2017 $ 2,439 2018 3,164 2019 3,134 2020 3,108 2021 3,078 Thereafter 22,008 $ 36,931 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following (in thousands): As of March 31, 2017 December 31, 2016 Payroll and related liabilities $ 3,105 $ 4,579 Royalties 3,615 3,172 Other 5,442 5,141 Total accrued liabilities $ 12,162 $ 12,892 |
Product Warranties (Tables)
Product Warranties (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Liability | Changes in our product warranty obligations were as follows (in thousands): Three Months Ended March 31, 2017 2016 Balance, beginning of period $ 7,450 $ 8,545 Accruals 803 1,530 Payments (1,261 ) (1,363 ) Balance, end of period $ 6,992 $ 8,712 |
Accumulated Other Comprehensi31
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following tables set forth the changes in accumulated other comprehensive income (loss), net of tax (in thousands) for the periods presented: Unrealized Loss on Available-for-Sale Securities Gain (Loss) on Derivative Securities (Effective Portion) Foreign Currency Translation Adjustments Accumulated Other Comprehensive Income (Loss) Balance, January 1, 2017 $ (8 ) $ (24 ) $ (1,185 ) $ (1,217 ) Current period other comprehensive income (loss) before reclassifications (19 ) 51 71 103 Reclassification of amounts to earnings — 68 — 68 Net other comprehensive income (loss) during period (19 ) 119 71 171 Balance, March 31, 2017 $ (27 ) $ 95 $ (1,114 ) $ (1,046 ) Unrealized Gain (Loss) on Available-for-Sale Securities Loss on Derivative Securities (Effective Portion) Foreign Currency Translation Adjustments Accumulated Other Comprehensive Loss Balance, January 1, 2016 $ (16 ) $ — $ (1,311 ) $ (1,327 ) Current period other comprehensive income (loss) before reclassifications 18 (761 ) 552 (191 ) Reclassification of amounts to earnings — 79 — 79 Net other comprehensive income (loss) during period 18 (682 ) 552 (112 ) Balance, March 31, 2016 $ 2 $ (682 ) $ (759 ) $ (1,439 ) |
Stock Repurchase Program Stock
Stock Repurchase Program Stock Repurchase Program (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule of Stock Repurchases | epurchases pursuant to the program are as follows: Quarter Ended Number of Shares Repurchased Amount Average Price Per Share December 31, 2016 120,996 $1,957,882 $16.18 March 31, 2017 218,515 3,426,959 15.68 Totals-to-Date 339,511 $5,384,841 $15.86 |
Income Per Share (Tables)
Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
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 were as follows (in thousands): Three Months Ended March 31, 2017 2016 Shares used to calculate basic income per share 30,713 31,016 Dilutive effect of outstanding stock options, performance stock units and restricted stock units 414 279 Shares used to calculate diluted income per share 31,127 31,295 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | 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. In the case of stock options, this is because the average market price did not exceed the exercise price. In the case of restricted stock units, this is because unrecognized compensation expense exceeds the current value of the awards (i.e., grant date market value was higher than current average market price). These shares may be dilutive potential common shares in the future (in thousands): Three Months Ended March 31, 2017 2016 Stock options 14 11 Restricted stock units 15 — |
Segment and Enterprise-wide I34
Segment and Enterprise-wide Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Summary Information by Reportable Segments | ollowing is summary information by reportable segment (in thousands): Three Months Ended March 31, 2017 2016 Net sales: Direct $ 74,703 $ 81,234 Retail 37,805 38,805 Royalty 744 889 Consolidated net sales $ 113,252 $ 120,928 Contribution: Direct $ 15,333 $ 21,144 Retail 2,212 3,944 Royalty 733 870 Consolidated contribution $ 18,278 $ 25,958 Reconciliation of consolidated contribution to income from continuing operations: Consolidated contribution $ 18,278 $ 25,958 Amounts not directly related to segments: Operating expenses (5,595 ) (6,658 ) Other income (expense), net (360 ) (536 ) Income tax expense (4,138 ) (7,178 ) Income from continuing operations $ 8,185 $ 11,586 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Revenue related to discontinued operations | $ 0 | $ 0 |
Company Vs. Biosig Instruments, Inc. | Settled Litigation | ||
Payment for legal settlement | $ 1,200,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Reclassification of amounts to earnings | $ 68 | $ 79 | |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 8,225 | $ 13,634 | |
Available for Sale Securities | 61,053 | 31,743 | |
Assets measured at fair value | 69,430 | 45,377 | |
Total liabilities measured at fair value | (38) | ||
Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 5,229 | 9,635 | |
Available for Sale Securities | 0 | 0 | |
Assets measured at fair value | 5,229 | 9,635 | |
Total liabilities measured at fair value | 0 | ||
Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 2,996 | 3,999 | |
Available for Sale Securities | 61,053 | 31,743 | |
Assets measured at fair value | 64,201 | 35,742 | |
Total liabilities measured at fair value | (38) | ||
Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Available for Sale Securities | 0 | 0 | |
Assets measured at fair value | 0 | 0 | |
Total liabilities measured at fair value | 0 | ||
Fair Value, Measurements, Recurring | Money market funds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 5,229 | 9,635 | |
Fair Value, Measurements, Recurring | Money market funds | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 5,229 | 9,635 | |
Fair Value, Measurements, Recurring | Money market funds | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Fair Value, Measurements, Recurring | Money market funds | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Fair Value, Measurements, Recurring | Commercial paper | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 2,996 | 3,999 | |
Available for Sale Securities | 15,931 | ||
Fair Value, Measurements, Recurring | Commercial paper | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Available for Sale Securities | 0 | ||
Fair Value, Measurements, Recurring | Commercial paper | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 2,996 | 3,999 | |
Available for Sale Securities | 15,931 | ||
Fair Value, Measurements, Recurring | Commercial paper | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash Equivalents | 0 | 0 | |
Available for Sale Securities | 0 | ||
Fair Value, Measurements, Recurring | Certificates of deposit | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 21,097 | 22,820 | |
Fair Value, Measurements, Recurring | Certificates of deposit | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Fair Value, Measurements, Recurring | Certificates of deposit | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 21,097 | 22,820 | |
Fair Value, Measurements, Recurring | Certificates of deposit | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Fair Value, Measurements, Recurring | Corporate bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 15,019 | 6,922 | |
Fair Value, Measurements, Recurring | Corporate bonds | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Fair Value, Measurements, Recurring | Corporate bonds | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 15,019 | 6,922 | |
Fair Value, Measurements, Recurring | Corporate bonds | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Fair Value, Measurements, Recurring | U.S. government bonds | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 9,006 | 2,001 | |
Fair Value, Measurements, Recurring | U.S. government bonds | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Fair Value, Measurements, Recurring | U.S. government bonds | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 9,006 | 2,001 | |
Fair Value, Measurements, Recurring | U.S. government bonds | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available for Sale Securities | 0 | 0 | |
Interest rate swap contract | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swap contract | 152 | ||
Fair value of liability derivatives | (38) | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 1 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swap contract | 0 | ||
Fair value of liability derivatives | 0 | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 2 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swap contract | 152 | ||
Fair value of liability derivatives | (38) | ||
Interest rate swap contract | Fair Value, Measurements, Recurring | Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate swap contract | $ 0 | ||
Fair value of liability derivatives | $ 0 |
Derivatives (Details)
Derivatives (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Derivative [Line Items] | |||
Accruals | $ 803 | $ 1,530 | |
Interest rate swap contract | |||
Derivative [Line Items] | |||
Derivative, notional amount | $ 60,000 | ||
Derivative, fixed interest rate | 1.42% | ||
Interest rate swap contract | LIBOR | |||
Derivative [Line Items] | |||
Derivative, basis spread on variable rate | 0.78056% | ||
Derivatives Designated as Hedging Instruments | Prepaid Expenses and Other Current Assets | Interest rate swap contract | |||
Derivative [Line Items] | |||
Derivative asset, fair value, gross asset | $ 152 | $ 0 | |
Derivatives Designated as Hedging Instruments | Accrued liabilities | Interest rate swap contract | |||
Derivative [Line Items] | |||
Fair value of liability derivatives | $ 0 | $ 38 |
Derivatives - Fair value of der
Derivatives - Fair value of derivative instruments (Details) - Interest rate swap contract - Derivatives Designated as Hedging Instruments - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets (Liabilities), at Fair Value, Net | $ 152 | $ 38 |
Prepaid Expenses and Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 152 | 0 |
Accrued liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Liability Derivatives | $ 0 | $ 38 |
Derivatives - Effect On Condens
Derivatives - Effect On Condensed Consolidated Statements of Operations (Details) - Interest rate swap contract - Cash Flow Hedging - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain (loss) recognized in other comprehensive income before reclassifications | $ 51 | $ (761) |
Interest expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Loss reclassified from accumulated other comprehensive income to earnings for the effective portion | (102) | (128) |
Income tax expense | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Income tax benefit | $ 34 | $ 49 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 30,314 | $ 43,130 |
Parts and components | 3,981 | 3,900 |
Total inventories | $ 34,295 | $ 47,030 |
Property, Plant and Equipment (
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 45,997 | $ 45,517 |
Accumulated depreciation | (29,279) | (28,049) |
Total property, plant and equipment, net | 16,718 | 17,468 |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 139 | 139 |
Automobiles | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Automobiles | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 6 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 3,426 | 3,388 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 4 years | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 20 years | |
Computer software and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 25,920 | 25,899 |
Computer software and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 3 years | |
Computer software and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 7 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 13,769 | 13,085 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 3 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,238 | 2,238 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 5 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life (in years) | 20 years | |
Work in Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 505 | $ 768 |
Goodwill and Other Intangible42
Goodwill and Other Intangible Assets Goodwill Roll Forward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Roll Forward] | ||
Balance | $ 61,888 | $ 60,470 |
Currency exchange rate adjustment | 17 | 70 |
Business acquisition - measurement period adjustments | 1,348 | |
Balance | 61,905 | 61,888 |
Direct | ||
Goodwill [Roll Forward] | ||
Balance | 2,180 | 2,113 |
Currency exchange rate adjustment | 18 | 67 |
Business acquisition - measurement period adjustments | 0 | |
Balance | 2,198 | 2,180 |
Retail | ||
Goodwill [Roll Forward] | ||
Balance | 59,708 | 58,357 |
Currency exchange rate adjustment | (1) | 3 |
Business acquisition - measurement period adjustments | 1,348 | |
Balance | $ 59,707 | $ 59,708 |
Goodwill and Other Intangible43
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | |
Goodwill [Line Items] | ||
Indefinite-lived trademarks | $ 32,052 | $ 32,052 |
Total other intangible assets, gross | 90,839 | 90,839 |
Accumulated amortization - definite-lived intangible assets | (21,856) | (21,039) |
Other intangible assets, net | $ 68,983 | 69,800 |
Definite-lived trademarks | Minimum | ||
Goodwill [Line Items] | ||
Estimated Useful Life (in years) | 10 years | |
Definite-lived trademarks | Maximum | ||
Goodwill [Line Items] | ||
Finite-lived intangible assets, gross | $ 2,600 | 2,600 |
Estimated Useful Life (in years) | 15 years | |
Patents | Minimum | ||
Goodwill [Line Items] | ||
Estimated Useful Life (in years) | 8 years | |
Patents | Maximum | ||
Goodwill [Line Items] | ||
Finite-lived intangible assets, gross | $ 31,487 | 31,487 |
Estimated Useful Life (in years) | 24 years | |
Customer relationships | Minimum | ||
Goodwill [Line Items] | ||
Estimated Useful Life (in years) | 10 years | |
Customer relationships | Maximum | ||
Goodwill [Line Items] | ||
Finite-lived intangible assets, gross | $ 24,700 | $ 24,700 |
Estimated Useful Life (in years) | 15 years |
Goodwill and Other Intangible44
Goodwill and Other Intangible Assets Patent amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 817 | $ 960 |
Goodwill and Other Intangible45
Goodwill and Other Intangible Assets Future intangible amortization (Details) $ in Thousands | Mar. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of 2017 | $ 2,439 |
2,018 | 3,164 |
2,019 | 3,134 |
2,020 | 3,108 |
2,021 | 3,078 |
Thereafter | 22,008 |
Finite-Lived Intangible Assets, Net | $ 36,931 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Payroll and related liabilities | $ 3,105 | $ 4,579 |
Royalties | 3,615 | 3,172 |
Other | 5,442 | 5,141 |
Total accrued liabilities | $ 12,162 | $ 12,892 |
Product Warranties (Details)
Product Warranties (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Movement in Product Warranty Liability [Roll Forward] | ||
Balance, beginning of period | $ 7,450 | $ 8,545 |
Payments | (1,261) | (1,363) |
Balance, end of period | $ 6,992 | $ 8,712 |
Minimum | ||
Product Liability Contingency [Line Items] | ||
Product warranty period | 30 days |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | $ 160,857 | |
Current period other comprehensive income (loss) before reclassifications | 103 | $ (191) |
Reclassification of amounts to earnings | (68) | (79) |
Net other comprehensive income (loss) during period | 171 | (112) |
Balance at end of period | 164,699 | |
Unrealized Loss on Available-for-Sale Securities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | (8) | (16) |
Current period other comprehensive income (loss) before reclassifications | (19) | 18 |
Reclassification of amounts to earnings | 0 | 0 |
Net other comprehensive income (loss) during period | (19) | 18 |
Balance at end of period | (27) | 2 |
Gain (Loss) on Derivative Securities (Effective Portion) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | (24) | 0 |
Current period other comprehensive income (loss) before reclassifications | 51 | (761) |
Reclassification of amounts to earnings | (68) | (79) |
Net other comprehensive income (loss) during period | 119 | (682) |
Balance at end of period | 95 | (682) |
Foreign Currency Translation Adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | (1,185) | (1,311) |
Current period other comprehensive income (loss) before reclassifications | 71 | 552 |
Reclassification of amounts to earnings | 0 | 0 |
Net other comprehensive income (loss) during period | 71 | 552 |
Balance at end of period | (1,114) | (759) |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Balance at beginning of period | (1,217) | (1,327) |
Balance at end of period | $ (1,046) | $ (1,439) |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - 10 Million Authorization Expansion, Expiring May 4, 2018 - Common Stock - USD ($) | Nov. 03, 2014 | Mar. 31, 2017 | May 04, 2016 |
Equity, Class of Treasury Stock [Line Items] | |||
Stock repurchase program, authorized amount | $ 10,000,000 | ||
Stock repurchase program, period in force | 24 months | ||
Remaining authorized repurchase amount | $ 4,600,000 |
Stock Repurchase Program, Repur
Stock Repurchase Program, Repurchased Shares (Details) - Common Stock - USD ($) | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2017 | |
Class of Stock [Line Items] | |||
Number of Shares (in shares) | 218,515 | 120,996 | 339,511 |
Repurchased Amount | $ 3,426,959 | $ 1,957,882 | $ 5,384,841 |
Average Price Per Share (in dollars per share) | $ 15.68 | $ 16.18 | $ 15.86 |
Income Per Share (Details)
Income Per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income per share: | ||
Shares used to calculate basic income per share | 30,713 | 31,016 |
Dilutive effect of outstanding stock options, performance stock units and restricted stock units | 414 | 279 |
Shares used to calculate diluted income per share | 31,127 | 31,295 |
Stock options | ||
Income per share: | ||
Anti-dilutive securities excluded from computation of diluted income per share | 14 | 11 |
Restricted stock units | ||
Income per share: | ||
Anti-dilutive securities excluded from computation of diluted income per share | 15 | 0 |
Segment and Enterprise-wide I52
Segment and Enterprise-wide Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of reportable segments | segment | 2 | |
Net sales | $ 113,252 | $ 120,928 |
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ||
Operating expenses | (49,062) | (47,044) |
Income tax expense | (4,138) | (7,178) |
Income from continuing operations | 8,185 | 11,586 |
Segment Reconciling Items | ||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ||
Other income (expense), net | (360) | (536) |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Net sales | 113,252 | 120,928 |
Contribution | 18,278 | 25,958 |
Operating Segments | Direct | ||
Segment Reporting Information [Line Items] | ||
Net sales | 74,703 | 81,234 |
Contribution | 15,333 | 21,144 |
Operating Segments | Retail | ||
Segment Reporting Information [Line Items] | ||
Net sales | 37,805 | 38,805 |
Contribution | 2,212 | 3,944 |
Operating Segments | Royalty | ||
Segment Reporting Information [Line Items] | ||
Royalty | 744 | 889 |
Unallocated royalty income, net | 733 | 870 |
Segment Reconciling Items | ||
Reconciliation of consolidated contribution to income (loss) from continuing operations: | ||
Operating expenses | (5,595) | (6,658) |
Income tax expense | $ (4,138) | $ (7,178) |
Segment and Enterprise-wide I53
Segment and Enterprise-wide Information - Concentration (Details) - customer | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Amazon.com | Sales Revenue, Net | Customer Concentration Risk | ||
Concentration Risk [Line Items] | ||
Number of significant customers | 0 | 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |
Standby letters of credit outstanding | $ 0 |
Inventories | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |
Non-cancelable market-based purchase obligation | 26.6 |
Company Vs. Biosig Instruments, Inc. | Settled Litigation | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |
Payment for legal settlement | $ 1.2 |
Subsequent Events (Details)
Subsequent Events (Details) - 10 Million Authorization Expansion, Expiring May 4, 2018 - Common Stock - USD ($) | Nov. 03, 2014 | Apr. 25, 2017 | Mar. 31, 2017 | May 04, 2016 |
Subsequent Event [Line Items] | ||||
Stock repurchase program, authorized amount | $ 10,000,000 | |||
Remaining authorized repurchase amount | $ 4,600,000 | |||
Stock repurchase program, period in force | 24 months | |||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Stock repurchase program, authorized amount | $ 15,000,000 | |||
Remaining authorized repurchase amount | $ 25,000,000 |