Document and Entity Information
Document and Entity Information | 12 Months Ended |
Aug. 31, 2020shares | |
Entity Information [Line Items] | |
Entity Registrant Name | EXFO Inc. |
Entity Central Index Key | 0001116284 |
Current Fiscal Year End Date | --08-31 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Shell Company | false |
Entity Filer Category | Accelerated Filer |
Entity Emerging Growth Company | false |
Document Type | 20-F |
Document Period End Date | Aug. 31, 2020 |
Amendment Flag | false |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Subordinate Voting Shares [Member] | |
Entity Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 24,060,766 |
Multiple Voting Shares [Member] | |
Entity Information [Line Items] | |
Entity Common Stock, Shares Outstanding | 31,643,000 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Current assets | ||
Cash | $ 32,818 | $ 16,518 |
Short-term investments (note 6) | 919 | 2,918 |
Accounts receivable (note 6) | ||
Trade | 56,291 | 51,517 |
Other | 4,055 | 3,396 |
Income taxes and tax credits recoverable (note 22) | 4,203 | 3,159 |
Inventories (note 7) | 38,865 | 38,017 |
Prepaid expenses | 5,631 | 6,510 |
Other assets (note 21) | 5,493 | 3,083 |
Total current assets | 148,275 | 125,118 |
Tax credits recoverable (note 22) | 48,812 | 46,704 |
Property, plant and equipment (notes 8 and 24) | 39,722 | 39,364 |
Lease right-of-use assets (notes 2, 9 and 24) | 10,758 | 0 |
Intangible assets (notes 10 and 24) | 17,616 | 21,654 |
Goodwill (notes 10 and 24) | 40,290 | 38,648 |
Deferred income tax assets (note 22) | 3,633 | 4,821 |
Other assets | 1,548 | 1,293 |
Total assets | 310,654 | 277,602 |
Current liabilities | ||
Bank loan (note 11) | 32,737 | 5,000 |
Accounts payable and accrued liabilities (note 12) | 41,348 | 50,790 |
Provisions (note 12) | 3,792 | 1,065 |
Income taxes payable | 43 | 704 |
Deferred revenue (note 21) | 25,785 | 24,422 |
Other liabilities | 4,032 | 1,606 |
Current portion of lease liabilities (note 2 and 13) | 3,249 | 0 |
Current portion of long-term debt (note 14) | 2,076 | 2,449 |
Total current liabilities | 113,062 | 86,036 |
Provisions (note 12) | 2,782 | 2,737 |
Deferred revenue (note 21) | 8,858 | 9,056 |
Lease liabilities (notes 2 and 13) | 7,334 | 0 |
Long-term debt (note 14) | 2,144 | 3,293 |
Deferred income tax liabilities (note 22) | 3,760 | 3,598 |
Other liabilities | 151 | 318 |
Total liabilities | 138,091 | 105,038 |
Commitments (note 15) | ||
Shareholders' equity | ||
Share capital (note 16) | 94,024 | 92,706 |
Contributed surplus | 19,680 | 19,196 |
Retained earnings | 102,633 | 112,173 |
Accumulated other comprehensive loss (note 17) | (43,774) | (51,511) |
Total shareholder' equity | 172,563 | 172,564 |
Total liabilities and stockholders' equity | $ 310,654 | $ 277,602 |
Consolidated Statements of Earn
Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | ||
Consolidated Statements of Earnings [Abstract] | ||||
Sales (note 24) | $ 265,583 | $ 286,890 | $ 269,546 | |
Cost of sales | [1] | 114,558 | 118,677 | 105,004 |
Selling and administrative | 92,293 | 98,646 | 98,794 | |
Net research and development | 45,487 | 50,553 | 57,154 | |
Depreciation of property, plant and equipment | 5,563 | 5,469 | 5,444 | |
Depreciation of lease right-of-use assets (note 2) | 3,349 | 0 | 0 | |
Amortization of intangible assets | 6,467 | 9,012 | 10,327 | |
Change in fair value of cash-contingent consideration | 0 | 0 | (670) | |
Interest and other expense | 956 | 718 | 1,378 | |
Foreign exchange (gain) loss | 428 | 949 | (1,309) | |
Share in net loss of an associate | 0 | 0 | 2,080 | |
Gain on deemed disposal of the investment in an associate | 0 | 0 | (2,080) | |
Earnings (loss) before income taxes | (3,518) | 2,866 | (6,576) | |
Income taxes (note 22) | 6,022 | 5,346 | 5,678 | |
Net loss for the year | (9,540) | (2,480) | (12,254) | |
Net loss for the year attributable to non-controlling interest | 0 | 0 | (352) | |
Net loss for the year attributable to parent interest | $ (9,540) | $ (2,480) | $ (11,902) | |
Basic and diluted net loss attributable to parent interest per share (in dollars per share) | $ (0.17) | $ (0.04) | $ (0.22) | |
Basic weighted average number of shares outstanding (in shares) | 55,604 | 55,325 | 54,998 | |
Diluted weighted average number of shares outstanding (note 23) (in shares) | 55,604 | 55,325 | 54,998 | |
[1] | The cost of sales is exclusive of depreciation and amortization, shown separately. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Consolidated Statements of Comprehensive Loss [Abstract] | |||
Net loss for the year | $ (9,540) | $ (2,480) | $ (12,254) |
Items that may be reclassified subsequently to net loss | |||
Foreign currency translation adjustment | 5,994 | (4,177) | (6,491) |
Unrealized gains/losses on forward exchange contracts | 1,221 | (795) | (1,476) |
Reclassification of realized gains/losses on forward exchange contracts to net earnings | 1,100 | 744 | (972) |
Deferred income tax effect of gains/losses on forward exchange contracts | (578) | 67 | 554 |
Other comprehensive income (loss) | 7,737 | (4,161) | (8,385) |
Comprehensive loss for the year | (1,803) | (6,641) | (20,639) |
Comprehensive loss for the year attributable to non-controlling interest | 0 | 0 | (352) |
Comprehensive loss for the year attributable to parent interest | $ (1,803) | $ (6,641) | $ (20,287) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Adjusted Balance [Member] | Share Capital [Member] | Share Capital [Member]Adjusted Balance [Member] | Contributed Surplus [Member] | Contributed Surplus [Member]Adjusted Balance [Member] | Retained Earnings [Member] | Retained Earnings [Member]Adjusted Balance [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Other Comprehensive Loss [Member]Adjusted Balance [Member] | Non-controlling Interest [Member] |
Balance, beginning of period at Aug. 31, 2017 | $ 196,790 | $ 90,411 | $ 18,184 | $ 127,160 | $ (38,965) | $ 0 | |||||
Reclassification of stock-based compensation costs (note 14) | 0 | 1,526 | (1,526) | 0 | 0 | 0 | |||||
Stock-based compensation costs | 1,770 | 0 | 1,770 | 0 | 0 | 0 | |||||
Business combination (note 3) | (3,662) | 0 | 0 | 0 | 0 | (3,662) | |||||
Acquisition of non-controlling interest on acquisition of subsidiary (note 3) | 3,662 | 0 | 0 | (352) | 0 | 4,014 | |||||
Net loss for the year | (12,254) | 0 | 0 | (11,902) | 0 | (352) | |||||
Other comprehensive income (loss) | |||||||||||
Foreign currency translation adjustment | (6,491) | 0 | 0 | 0 | (6,491) | 0 | |||||
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | (1,894) | 0 | 0 | 0 | (1,894) | 0 | |||||
Comprehensive loss for the year | (20,639) | ||||||||||
Adoption of IFRS 9 (note 2) (Adoption of IFRS 9 or Adjustment for Adoption of IFRS 9 [Member]) at Aug. 31, 2018 | (253) | 0 | 0 | (253) | 0 | ||||||
Adoption of IFRS 9 (note 2) at Aug. 31, 2018 | 177,921 | $ 177,668 | 91,937 | $ 91,937 | 18,428 | $ 18,428 | 114,906 | $ 114,653 | (47,350) | $ (47,350) | $ 0 |
Reclassification of stock-based compensation costs (note 14) | 0 | 1,106 | (1,106) | 0 | 0 | ||||||
Redemption of share capital (note 14) | (312) | (337) | 25 | 0 | 0 | ||||||
Stock-based compensation costs | 1,849 | 0 | 1,849 | 0 | 0 | ||||||
Net loss for the year | (2,480) | 0 | 0 | (2,480) | 0 | ||||||
Other comprehensive income (loss) | |||||||||||
Foreign currency translation adjustment | (4,177) | 0 | 0 | 0 | (4,177) | ||||||
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | 16 | 0 | 0 | 0 | 16 | ||||||
Comprehensive loss for the year | (6,641) | ||||||||||
Adoption of IFRS 9 (note 2) at Aug. 31, 2019 | 172,564 | 92,706 | 19,196 | 112,173 | (51,511) | ||||||
Reclassification of stock-based compensation costs (note 14) | 0 | 1,530 | (1,530) | 0 | 0 | ||||||
Redemption of share capital (note 14) | (225) | (212) | (13) | 0 | 0 | ||||||
Stock-based compensation costs | 2,027 | 0 | 2,027 | 0 | 0 | ||||||
Net loss for the year | (9,540) | 0 | 0 | (9,540) | 0 | ||||||
Other comprehensive income (loss) | |||||||||||
Foreign currency translation adjustment | 5,994 | 0 | 0 | 0 | 5,994 | ||||||
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | 1,743 | 0 | 0 | 0 | 1,743 | ||||||
Comprehensive loss for the year | (1,803) | ||||||||||
Adoption of IFRS 9 (note 2) at Aug. 31, 2020 | $ 172,563 | $ 94,024 | $ 19,680 | $ 102,633 | $ (43,774) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Other comprehensive income (loss) | |||
Changes in unrealized gains/losses on forward exchange contracts, deferred income taxes | $ (578) | $ 67 | $ 554 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Cash flows from operating activities | |||
Net loss for the year | $ (9,540) | $ (2,480) | $ (12,254) |
Add (deduct) items not affecting cash | |||
Stock-based compensation costs | 2,021 | 1,831 | 1,748 |
Depreciation and amortization | 15,379 | 14,481 | 15,771 |
Gain on disposal of capital assets | (340) | (1,732) | 0 |
Write-off of capital assets | 223 | 1,386 | 592 |
Change in fair value of cash-contingent consideration | 0 | 0 | (670) |
Deferred revenue | 401 | 10,477 | 1,998 |
Deferred income taxes | 657 | (2,103) | 1,368 |
Share in net loss of an associate | 0 | 0 | 2,080 |
Gain on deemed disposal of the investment in an associate | 0 | 0 | (2,080) |
Changes in foreign exchange gain/loss | 1,436 | (46) | (181) |
Cash flows from operations before changes in working capital | 10,237 | 21,814 | 8,372 |
Changes in non-cash operating items | |||
Accounts receivable | (1,623) | (4,786) | 7,275 |
Income taxes and tax credits | (2,871) | 1,536 | 86 |
Inventories | (45) | (134) | (1,020) |
Prepaid expenses | 462 | (1,307) | 57 |
Other assets | (1,963) | (1,459) | (1,311) |
Accounts payable and accrued liabilities and provisions | (6,382) | 3,184 | 1,033 |
Other liabilities | 48 | (1,606) | (122) |
Net cash flows from operating activities | (2,137) | 17,242 | 14,370 |
Cash flows from investing activities | |||
Additions to short-term investments | (2,574) | (1,879) | (1,550) |
Proceeds from disposal and maturity of short-term investments | 4,316 | 1,168 | 234 |
Purchases of capital assets (notes 8 and 10) | (7,646) | (7,498) | (10,452) |
Proceeds from disposal of capital assets | 230 | 3,318 | 0 |
Investment in an associate | 0 | 0 | (12,530) |
Business combinations, net of cash acquired | 0 | 0 | (19,600) |
Net cash flows from investing activities | (5,674) | (4,891) | (43,898) |
Cash flows from financing activities | |||
Bank loan | 26,532 | (5,195) | 11,061 |
Other liabilities | 2,355 | 0 | (1,449) |
Repayment of lease liabilities | (3,334) | 0 | 0 |
Repayment of long-term debt | (1,847) | (2,817) | (1,688) |
Redemption of share capital (note 16) | (225) | (312) | 0 |
Acquisition of non-controlling interest | 0 | 0 | (3,657) |
Net cash flows from financing activities | 23,481 | (8,324) | 4,267 |
Effect of foreign exchange rate changes on cash | 630 | (267) | (416) |
Change in cash | 16,300 | 3,760 | (25,677) |
Cash - Beginning of year | 16,518 | 12,758 | 38,435 |
Cash - End of year | 32,818 | 16,518 | 12,758 |
Supplementary information | |||
Income taxes paid | $ 1,977 | $ 2,577 | $ 2,376 |
Nature of Activities and Incorp
Nature of Activities and Incorporation | 12 Months Ended |
Aug. 31, 2020 | |
Nature of Activities and Incorporation [Abstract] | |
Nature of Activities and Incorporation | 1 Nature of Activities and Incorporation EXFO Inc. and its subsidiaries (together “EXFO” or the “company”) develops . EXFO is a company incorporated under the Canada Business Corporations Act and is domiciled in Canada. The address of its headquarters is 400 Godin Avenue, Québec City, Quebec, Canada, G1M 2K2. These consolidated financial statements were authorized for issue by the Board of Directors on November 25, 2020. |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Aug. 31, 2020 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 2 Basis of Presentation These consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards International Accounting Standards Board IFRS Pronouncements Adopted in Fiscal 2020 Leases IFRS 16, Leases, was issued in January 2016. IFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract, i.e., the customer (lessee) and the supplier (lessor). IFRS 16 supersedes IAS 17, Leases, and related interpretations. Under IFRS 16, lessees recognize a lease right-of-use (ROU) asset and a lease liability measured at the present value of lease payments for virtually all their leases. Short-term leases with a term of 12 months or less are not required to be recognized. This new standard is effective for annual periods beginning on or after January 1, 2019. The company adopted this new standard on September 1, 2019, using the modified retrospective method, which did not require adjustments to comparative periods. The company applied IFRS 16 at the adoption date and recognized lease ROU assets and lease liabilities in the year of adoption. The new standard provides several optional practical expedients in transition. Upon implementation of the new standard, the company elected the practical expedients to combine lease and non-lease components and to not recognize lease ROU assets and lease liabilities for short-term leases and low-value assets. Also, contracts that were not identified as leases under previous standards were not reassessed for whether there is a lease therein. The company identified appropriate changes to its accounting policies, information technology systems, business processes, and related internal controls to support recognition and disclosure requirements under IFRS 16. The adoption of IFRS 16 on September 1, 2019 resulted in the recognition of lease ROU assets of $11,321,000, lease liabilities of $10,843,000, and the elimination of prepaid rent of $478,000 in the consolidated balance sheet as of that date. In addition, lease payments, previously reported in cash flows from operating activities, are now reported in cash flows from financing activities in the consolidated statements of cash flows. However, the adoption of this standard had no significant impact on net loss. Upon the adoption of IFRS 16, the lease expense, previously recorded under the cost of sales, selling and administrative expenses and net research and development expenses line items, is recorded as depreciation expenses for the lease ROU assets and as interest expenses on the lease liabilities in the consolidated statements of earnings. Finally, the adoption of IFRS 16 had no significant impact on liquidity and debt covenant compliance under existing debt agreements. Uncertainty over Income Tax Treatments IFRIC 23, Uncertainty over Income Tax Treatments, was issued in June 2017. IFRIC 23 provides guidance on how to value uncertain income tax positions based on the probability of whether the relevant tax authorities will accept the company’s tax treatments. A company is to assume that a taxation authority with the right to examine any amounts reported to it will examine those amounts and will have full knowledge of all relevant information when doing so. IFRIC 23 is effective for annual periods beginning on or after January 1, 2019. The company adopted this interpretation on September 1, 2019, and its adoption had no significant impact on its consolidated financial statements. Basis of measurement These consolidated financial statements have been prepared under the historical cost convention, except for the revaluation of derivative financial instruments and short-term investments. Consolidation These consolidated financial statements include the accounts of the company and its domestic and foreign subsidiaries. Intercompany accounts and transactions have been eliminated. Revenue recognition The company exercises judgment and uses estimates in connection with determining the amounts of product and service revenues to be recognized in each accounting period. The company accounts for revenue once a legally enforceable contract with a customer has been approved by the parties and the related promises to transfer products or services have been identified. A contract is defined by the company as an arrangement with commercial substance identifying payment terms, and each party’s rights and obligations regarding the products or services to be transferred and for which collection is probable. The company’s contracts usually take the form of purchase orders. Customer contracts may include promises to transfer multiple products and services. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one single performance obligation may require significant judgment. The company derives revenues from goods and services. Sales of goods, consist of standalone hardware products, hardware products with embedded software that are essential to providing customers the intended functionality of the solutions, standalone software licenses, as well as hardware products bundled with a software license. Sales of services mainly consist of professional services, consulting, stand-ready software-as-a-service (SaaS), maintenance contracts, extended warranties, installation, integration, and training. The company’s performance obligations consist of a variety of products and services. Revenue is recognized when control of the products or services are transferred to the customers in an amount that reflects the consideration the company expects to be entitled to in exchange for products and services. Revenue from software and hardware support is recognized ratably over the support period. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. SaaS services are recognized ratably over the contract term. If the contract contains a single performance obligation, the entire transaction price is attributed to that performance obligation. Some of the company’s contracts include multiple distinct performance obligations with a combination of products and services, maintenance and support, professional services and/or training. The company allocates the transaction price among the performance obligations in an amount that depicts the relative standalone selling prices (SSP) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. The company assesses SSP based on historical pricing for products and services, whether sold alone or as part of a multiple element transaction. The company reviews sales of the product and services elements on a regular basis and updates, when appropriate, its SSP for such elements to ensure that it reflects recent pricing experience. Payments for products and services are typically due up front with payment terms of 30 to 90 days. However, the company has contracts pursuant to which payments are due over a certain period generally not exceeding one year based on agreed-upon payment terms either prior to or following the transfer of control for the contracted performance obligations. Payments on multi-year maintenance and consulting services are typically due in annual, quarterly or monthly installments over the contract term. The company did not have any material variable consideration such as obligations for returns, refunds or warranties as at August 31, 2019 and 2020. Presentation currency The functional currency of the company is the Canadian dollar. The company has adopted the US dollar as its presentation currency as it is the most commonly used reporting currency in its industry. The consolidated financial statements are translated into the presentation currency as follows: assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet; revenues and expenses are translated at the monthly average exchange rate. The foreign currency translation adjustment arising from such translation is included in accumulated other comprehensive loss in shareholders’ equity. Foreign currency translation (a) Foreign currency transactions Transactions denominated in currencies other than the functional currency are translated into the relevant functional currency as follows: monetary assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet, and revenues and expenses are translated at the exchange rate in effect on the date of the transaction. Non-monetary assets and liabilities measured at historical cost and denominated in a foreign currency are translated using the exchange rate at the date of the transaction, whereas non-monetary items that are measured at fair value and denominated in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Foreign exchange gains and losses arising from such translation are included in the consolidated statements of earnings. (b) Foreign operations Each foreign operation determines its own functional currency, and items included in the financial statements of each foreign operation are measured using that functional currency. The financial statements of each foreign operation that has a functional currency different from that of the company are translated into Canadian dollars as follows: assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet; revenues and expenses are translated at the monthly average exchange rate. The foreign currency translation adjustment arising from such translation is included in accumulated other comprehensive income in shareholders’ equity. Financial instruments The classification of financial instruments depends on the intended purpose when the financial instruments were acquired or issued, as well as on their characteristics and designation by the company. Financial assets at amortized cost Financial assets are measured at amortized cost if they are held within a business model whose objective is to hold assets to collect contractual cash flows, and their contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Otherwise, they are classified at fair value through profit or loss through other comprehensive income. Financial liabilities at amortized cost Financial liabilities are measured at amortized cost. Financial assets at fair value through other comprehensive income Financial assets at fair value through other comprehensive income are initially recognized at fair value plus transaction costs and are subsequently measured at fair value. After their initial recognition, any changes in their fair value are reflected in the consolidated statements of comprehensive loss. Derivative financial instruments and hedging activities Forward exchange contracts are utilized by the company to manage its foreign currency exposure. Forward exchange contracts are entered into by the company to hedge anticipated US-dollar-denominated sales and the related accounts receivable as well as Indian-rupee-denominated operating expenses and the related accounts payable. The company’s policy is not to utilize those derivative financial instruments for trading or speculative purposes. The company’s forward exchange contracts, which are designated as cash flow hedging instruments, qualify for hedge accounting. Forward exchange contracts are classified as financial instruments at fair value through other comprehensive income. They are initially recorded at fair value and subsequently measured at fair value. The fair value of forward exchange contracts is determined using observable prices and forward exchange rates at the consolidated balance sheet date, with the resulting value discounted back to present value. After initial recognition, the effective portion of changes in their fair value is reflected in other comprehensive income. Any ineffective portion is recognized immediately in the consolidated statements of earnings. Upon recognition of related hedged sales and operating expenses, accumulated changes in fair value of forward exchange contracts are respectively reclassified in sales and net research and development expenses in the consolidated statements of earnings. At the inception of a hedge relationship, the company formally designates and documents the hedge relationship to which the company wishes to apply hedge accounting, the risk management objectives, the hedging instrument, the hedged item and the method used to test effectiveness. The company assesses effectiveness of the hedge relationship at inception and on an ongoing basis using the dollar-offset method. Fair value hierarchy The company classifies its derivative and non-derivative financial assets and financial liabilities measured at fair value using the fair value hierarchy as follows: Level 1: Quoted prices (unadjusted) in an active market for identical assets or liabilities; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset and liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. The company’s short-term investments and forward exchange contracts are measured at fair value at each consolidated balance sheet date. The company’s short-term investments are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. The company’s forward exchange contracts are classified within Level 2 of the fair value hierarchy because they are valued using observable prices and forward foreign exchange rates at the consolidated balance sheet dates. Short-term investments All investments with original terms to maturity of three months or less and that are not required for the purposes of meeting short-term cash requirements are classified as short-term investments. Inventories Inventories are valued on an average cost basis, at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale. The cost of work in progress and finished goods includes material, labor and an allocation of manufacturing overhead. Property, plant and equipment and depreciation Property, plant and equipment are recorded at cost, net of accumulated depreciation and accumulated impairment losses. Such cost is reduced by related research and development tax credits. Depreciation is provided on a straight-line basis over the estimated useful lives of the asset as follows: Term Land improvements 15 years Buildings 20 to 60 years Equipment 3 to 15 years Leasehold improvements The lesser of useful life and remaining lease term The assets’ residual values and useful lives are reviewed at each financial year-end and are adjusted prospectively, if appropriate. Intangible assets, goodwill and amortization Intangible assets Intangible assets with finite useful lives primarily include the cost of core technology, customer relationships and software. The cost of intangible assets acquired in a business combination is the fair value of the assets at the date of acquisition. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is provided on a straight-line basis over the estimated useful lives of two to eight years for core technologies, three months to five years for customer relationships, one year for brand name, and two and eight years for software. None of the company’s intangible assets were developed internally. The amortization method and the useful lives of intangible assets are reviewed at each financial year-end and are adjusted prospectively, if appropriate. Goodwill Goodwill represents the excess of the purchase price of acquired businesses over the estimated fair value of net identifiable assets acquired and is allocated to each cash-generating unit (CGU) or group of CGUs that are expected to benefit from the related business combination. A group of CGUs represents the lowest level within the company at which the goodwill is monitored for internal management purposes, which is not higher than an operating segment. Goodwill is not amortized but must be tested for impairment on an annual basis or more frequently if events or circumstances indicate that it might be impaired. Research and development All costs related to research are expensed as incurred, net of related tax credits and grants. Development costs are expensed as incurred, net of related tax credits and grants, unless they meet the recognition criteria of IAS 38, Intangible Assets, in which case they are capitalized, net of related tax credits and grants and amortized on a straight-line basis over the estimated benefit period. Research and development expenses mainly comprise salaries and related expenses, material costs as well as fees paid to third-party consultants. As at August 31, 2019 and 2020, the company had not capitalized any development costs. The company elected to account for non-refundable research and development tax credits under IAS 20, Accounting for Governmental Grants and Disclosures of Governmental Assistance, and, as such, these tax credits are presented against gross research and development expenses in the consolidated statements of earnings. Non-refundable research and development tax credits are included in earnings or deducted from the related assets, provided there is reasonable assurance that the company has complied and will comply with the conditions related to the tax credits and that the tax credits will be received. Impairment of non-financial assets The company assesses at each reporting date whether there is an indication that the carrying value of property, plant and equipment and finite-life intangible assets may not be recoverable. Non-financial assets that are not amortized (such as goodwill) are subject to an annual impairment test. If any indication exists, or when annual impairment testing is required, the company estimates the asset or asset group’s recoverable amount. For the purpose of measuring recoverable amounts, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). The recoverable amount is the higher of an asset or CGU’s fair value less costs of disposal and its value in use. Where the carrying value of an asset or CGU exceeds its recoverable amount, the asset or the CGU is considered impaired and is written down to its recoverable amount. The company performs its annual goodwill impairment test in the fourth quarter of each fiscal year. For property, plant and equipment and finite-life intangible assets, the reversal of impairment is limited so that the carrying value of the asset does not exceed its recoverable amount, nor exceed the carrying value that would have been determined, net of depreciation or amortization, had no impairment loss been recognized for the asset in prior periods. Impairment losses on goodwill are not reversed. Government grants Grants related to operating expenses are included in earnings when the related expenses are incurred. Grants related to capital expenditures are deducted from the related assets. Grants are included in the consolidated statements of earnings or deducted from the related assets, provided there is reasonable assurance that the company has complied and will comply with all the conditions related to the grants and that the grants will be received. Leases The company determines if an arrangement is a lease or contains a lease at inception. Operating lease liabilities are recognized based on the present value of the remaining lease payments, discounted using the discount rate for the lease at the commencement date, and are subsequently adjusted for interest and lease payments. When the rate implicit in the lease is not readily determinable, the company uses an incremental borrowing rate based on information available at the commencement date to determine the present value of future lease payments. The lease term is the non-cancelable period of the lease and includes options to extend or terminate the lease when it is reasonably certain that an option will be exercised. Lease ROU assets are recognized at commencement based on the amount of the initial measurement of the lease liabilities. Lease ROU assets also include any lease payments made prior to lease commencement and exclude lease incentives. Lease ROU assets are depreciated on a straight-line basis over the lease term. The company’s lease terms may include options to extend or terminate the lease where it is reasonably certain that the company will exercise those options. The company considers several economic factors when making this determination including, but not limited to, the significance of leasehold improvements incurred in the office space, the difficulty in replacing the asset, underlying contractual obligations, and specific characteristics unique to a lease. Warranty The company offers its customers basic warranties of one to three years, depending on the specific products and terms of the purchase agreement. The company’s typical warranties require it to repair or replace defective products during the warranty period at no cost to the customer. Costs related to basic warranties are accrued at the time of shipment, based upon estimates of expected rework and warranty costs to be incurred. Costs associated with separately priced extended warranties are expensed as incurred. Income taxes Income taxes comprise current and deferred income taxes. Current income taxes Current income tax assets and liabilities for the current and prior years are measured at the amount expected to be recovered or paid to the taxation authorities. Income tax rates used to calculate the amount are those that are enacted or substantively enacted at the consolidated balance sheet dates in the tax jurisdictions where the company generates taxable income/loss. Deferred income taxes The company provides for deferred income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on deductible or taxable temporary differences between the consolidated financial statement values and tax values of assets and liabilities as well as the carry-forward of unused tax losses and deductions, using enacted or substantively enacted income tax rates at the consolidated balance sheet dates, that are expected to be in effect for the years in which the assets are expected to be recovered or the liabilities to be settled. Deferred income tax assets are recognized only to the extent that it is probable that future taxable income will be available against which the deductible temporary differences as well as unused tax losses and deductions can be utilized. Deferred tax liabilities are recognized for all taxable temporary differences and for taxable temporary differences arising on investments in subsidiaries, except where the reversal of these temporary differences can be controlled, and it is probable that the differences will not reverse in the foreseeable future. Deferred income tax assets and liabilities are presented as non-current in the consolidated balance sheets. Earnings per share Basic earnings per share are calculated by dividing net earnings attributable to common equity holders of the company by the weighted average number of common shares outstanding during the year. Diluted earnings per share are calculated by dividing net earnings attributable to common equity holders of the company by the weighted average number of common shares outstanding during the year, plus the effect of dilutive potential common shares outstanding during the year. This method requires that diluted earnings per share be calculated (using the treasury stock method) as if all dilutive potential common shares had been exercised at the latest at the beginning of the year or on the date of issuance, as the case may be, and that the funds obtained thereby (plus an amount equivalent to the unamortized portion of related stock-based compensation costs) be used to purchase common shares of the company at the average market price of the common shares during the year. Stock-based compensation Equity-settled awards The company’s stock options, restricted share units and deferred share units are equity-settled awards. The company accounts for stock-based compensation costs on equity-settled awards using the Black-Scholes option valuation model. The fair value of equity-settled awards is measured at the date of grant. Stock-based compensation costs are amortized to expense over the vesting periods together with a corresponding change in contributed surplus in shareholders’ equity. For equity-settled awards with graded vesting, each tranche is considered a separate grant with a different vesting date and fair value, and each tranche is accounted for separately. Cash-settled awards The company’s stock appreciation rights are cash-settled awards. The company accounts for stock-based compensation costs on cash-settled awards using the Black-Scholes option valuation model. The fair value of the cash-settled awards is remeasured at the end of each reporting period, with any changes in the fair value recognized in the consolidated statements of earnings. Operating segments Operating segments are defined as components of an entity engaged in business activities from which it may earn revenues and incur expenses, and whose operating results are regularly reviewed by the Chief Operating Decision maker (CODM) to make decisions about resources to be allocated to segments and assess their performance and for which discrete information is available. The function of the CODM is performed by the Chief Executive Officer who reviews consolidated results for the purposes of allocating resources and evaluating performance. Accordingly, the company determines that it has one operating segment as of, and for the years ended August 31, 2018, 2019 and 2020. Entity-wide disclosures are presented in note 24. Critical judgments, estimates and assumptions Coronavirus pandemic In December 2019, a novel strain of coronavirus was identified in China and resulted in preventive measures imposed by the Chinese public health authorities including an extended shutdown of businesses, restrictions on various forms of public transportation and lockdown periods for individuals—all of which affected the company’s factory and supply chain during a certain period. In March 2020, this coronavirus epidemic was declared a pandemic by and most countries have been imposing ongoing constraints and preventive measures that have affected and are still affecting the global economy. Significant fluctuations in the stock market have occurred for various reasons linked to the coronavirus pandemic. Although constraints and preventive measures are progressively being relaxed in many countries, the breadth and duration of this pandemic are unknown and raise uncertainties that may impact the measurement of assets and liabilities in future periods. This pandemic had a negative impact on the company’s sales and operating results in fiscal 2020, and the company believes it might continue to negatively impact its sales and operating results to a certain extent over an undetermined period, depending on the evolution of the pandemic and its treatment, if any. In addition, over the last months, the company’s stock price significantly fluctuated as a result of the pandemic. As a result of these impacts, during the third quarter of fiscal 2020, the company concluded that they represented a triggering event and performed goodwill impairment testing for all CGUs. The company also performed its annual goodwill impairment test as at August 31, 2020 (note 10). As at May 31 and August 31, 2020, the recoverable amount for all CGUs exceeded their carrying value. The preparation of financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses as well as the disclosures of contingent assets and liabilities at the date of the financial statements. On an ongoing basis, the company evaluates these estimates and assumptions, including those related to the fair value of assets and liabilities acquired in business combinations, the fair value of financial instruments, the allowance for doubtful accounts receivable, the amount of tax credits recoverable, the provision for excess and obsolete inventories, the estimated useful lives of capital assets, the valuation of long-lived assets, the impairment of goodwill, the recoverable amount of deferred income tax assets, the amount of certain accrued liabilities, provisions and deferred revenue as well as stock-based compensation costs. The company bases its estimates and assumptions on historical experience and on other factors that it believes to be reasonable under the circumstances. Actual results could differ from those judgments, estimates and assumptions. Critical judgments in applying accounting policies (a) Determination of functional currency The company operates in multiple countries and generates revenue and incurs expenses in several currencies, namely the Canadian dollar, the US dollar, the euro, the British pound, the Indian rupee and the CNY (Chinese currency). The determination of the functional currency of the company and its subsidiaries may require significant judgment. In determining the functional currency of the company and its subsidiaries, management takes into account primary, secondary and tertiary indicators. When indicators are mixed, and the functional currency is not obvious, management uses its judgment to determine the functional currency. (b) Determination of cash-generating units and allocation of goodwill For the purpose of impairment testing, goodwill must be allocated to each CGU or group of CGUs that is expected to benefit from the synergies of the business combination. Initial allocation and possible reallocation of goodwill to a CGU or a group of CGUs requires judgment. Critical estimates and assumptions (a) Inventories The company states its inventories at the lower of cost, determined on an average cost basis, and net realizable value, and provides reserves for excess and obsolete inventories. The company determines its reserves for excess and obsolete inventories based on the quantities on hand at the reporting dates compared to foreseeable needs, taking into account changes in demand, technology or market. (b) Income taxes The company is subject to income tax laws and regulations in several jurisdictions. Under these laws and regulations, uncertainties exist with respect to the interpretation of complex tax laws and regulations and the amount and timing of future taxable income. The company maintains provisions for uncertain tax positions that it believes appropriately reflect its risk based on its interpretation of laws and regulations. In addition, management has made reasonable estimates and assumptions to determine the amount of deferred tax assets that can be recognized in the consolidated financial statements, based upon the likely timing and level of anticipated future taxable income together with tax-planning strategies. The ultimate realization of the company’s deferred income tax assets is dependent upon the generation of sufficient future taxable income during the periods in which those assets are expected to be realized. (c) Tax credits recoverable Tax credits are recorded if there is reasonable assurance that the company has complied and will comply with all the conditions related to the tax credits and that the tax credits will be received. The ultimate recovery of the company’s non-refundable tax credits is dependent upon the generation of sufficient future taxable income during the tax credits carry-forward periods. Management has made reasonable estimates and assumptions to determine the amount of non-refundable tax credits that can be recognized in the consolidated financial statements, based upon the likely timing and level of anticipated future taxable income together with tax-planning strategies (note 22). (d) Impairment of non-financial assets |
Government Grants
Government Grants | 12 Months Ended |
Aug. 31, 2020 | |
Government Grants [Abstract] | |
Government Grants | 3 Government Grants In fiscal 2020, the Government of Canada introduced the Canada Emergency Wage Subsidy (CEWS) to help qualifying Canadian businesses facing hardship as a result of the coronavirus pandemic. The CEWS covered up to 75% of wages for a maximum period of four months starting March 15, 2020 and ending July 4, 2020. It also covered up to 60% of wages for the periods starting July 5 and ending August 29, 2020, up to 50% for the period starting August 30 and ending September 26, 2020, up to 40% for the period starting September 27 and ending October 24, 2020, up to 40% for the period starting October 25 and ending November 21, 2020, and up to 40% for the period starting November 22 and ending December 19, 2020. To be eligible to the CEWS, businesses must have suffered a drop in gross revenues above certain thresholds during these periods. The company qualified for the CEWS for the period from March 15 to May 9, 2020, and recorded grants of $3,262,000 in the consolidated statement of earnings for the year ended August 31, 2020. The company accounted for the CEWS as a government grant under IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, and it was deducted from the same consolidated statement of earnings line item as the wages were recognized |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Aug. 31, 2020 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | 4 Restructuring Charges Fiscal 2020 In August 2020, the company implemented a restructuring plan to align its cost structure with challenges imposed by the coronavirus pandemic and to strengthen focus on high-growth drivers like fiber, 5G and cloud-native deployments. This plan resulted in expenses comprised mainly of severance expenses for the employees laid-off. During the fourth quarter of fiscal 2020, the company recorded pre-tax restructuring charges of $2,886,000 in the consolidated statement of earnings (note 20). Fiscal 2018 In August 2018, the company implemented a restructuring plan to accelerate the integration of its acquired monitoring and analytics technologies from EXFO Solutions and simplify its cost structure and optimize resources as the company converges toward fewer sites and reduces its workforce. This plan resulted in expenses mainly comprising severance expenses, costs for a remaining non-cancellable operating lease, write-off of research and development income tax credits and impairment of long-lived assets, net of related income taxes. During the fourth quarter of fiscal 2018, the company recorded severance expenses of $2,072,000, costs for the remaining non‑cancelable operating lease of $1,137,000, write-off of research and development income tax credits of $1,200,000 and impairment of long-lived assets of $150,000, net of related income taxes of $1,150,000, for total after-tax restructuring charges of $3,409,000. The additional restructuring charges of $3,305,000, and related income taxes of $63,000, for total after-tax restructuring charges of $3,242,000 (note 20), was recorded in fiscal 2019. Restructuring charges in fiscal 2019 comprised severance expenses and were part of the fiscal 2018 restructuring plan. In fiscal 2019, as part of this restructuring plan and the shutdown of its facilities in Toronto, Canada, the company sold one of its buildings for net proceeds of $3,318,000. The transaction resulted in a pre-tax gain of $1,732,000 that was recorded in the consolidated statement of earnings for the year ended August 31, 2019. In addition, in fiscal 2019, as part of this restructuring plan and the shutdown of some of its facilities in the United States, the company transferred the ownership of certain intellectual properties held in the United States to Canada. This created a deductible tax asset in Canada and resulted in the recognition of a deferred income tax recovery of $2,383,000 in fiscal 2019 as the recovery of this asset is probable. This deferred income tax recovery was recorded in the consolidated statement of earnings for the year ended August 31, 2019. The following tables summarize changes in restructuring accrual during the years ended August 31, 2019 and 2020: Years ended August 31, 2020 2019 Balance – Beginning of year $ 1,133 $ 3,167 Addition 2,886 3,305 Payments (393 ) (5,339 ) Balance – End of year (note 12) $ 3,626 $ 1,133 |
Capital Disclosures
Capital Disclosures | 12 Months Ended |
Aug. 31, 2020 | |
Capital Disclosures [Abstract] | |
Capital Disclosures | 5 Capital Disclosures The company is not subject to any external restrictions on its capital. The company’s objectives when managing capital are: • To maintain a flexible capital structure that optimizes the cost of capital at acceptable risk; • To sustain future development of the company, including research and development activities, market development and potential acquisitions of complementary businesses or products; and • To provide the company’s shareholders with an appropriate return on their investment. No changes were made to the objectives and policies during the years ended August 31, 2019 and 2020. The company defines its capital as shareholders’ equity, excluding accumulated other comprehensive loss. The capital of the company amounted to $224,075,000 and $216,337,000 as at August 31, 2019 and 2020 respectively. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Aug. 31, 2020 | |
Financial Instruments [Abstract] | |
Financial Instruments | 6 Financial Instruments The following tables summarize financial instruments by category: As at August 31, 2020 Amortized cost Fair value through other comprehensive income Total Financial assets Cash $ 32,818 $ – $ 32,818 Short-term investments $ – $ 919 $ 919 Accounts receivable $ 59,328 $ – $ 59,328 Forward exchange contracts $ – $ 1,587 $ 1,587 Financial liabilities Bank loan $ 32,737 $ – $ 32,737 Accounts payable and accrued liabilities $ 41,238 $ – $ 41,238 Other liabilities $ 4,032 $ – $ 4,032 Long-term debt $ 4,220 $ – $ 4,220 Forward exchange contracts $ – $ 110 $ 110 As at August 31, 2019 Amortized cost Fair value through other comprehensive income Total Financial assets Cash $ 16,518 $ – $ 16,518 Short-term investments $ – $ 2,918 $ 2,918 Accounts receivable $ 54,834 $ – $ 54,834 Forward exchange contracts $ – $ 79 $ 79 Financial liabilities Bank loan $ 5,000 $ – $ 5,000 Accounts payable and accrued liabilities $ 49,945 $ – $ 49,945 Other liabilities $ 1,606 $ – $ 1,606 Long-term debt $ 5,742 $ – $ 5,742 Forward exchange contracts $ – $ 1,057 $ 1,057 Fair value Cash, accounts receivable, bank loan, accounts payable and accrued liabilities and other liabilities are financial instruments whose carrying values approximate their fair values due to their short-term maturities. The fair value of the long-term debt amounted to $5,644,000 and $4,115,000 as at August 31, 2019 and 2020 respectively. The fair value of derivative and non-derivative financial assets and financial liabilities measured at fair value by level of hierarchy is as follows: As at August 31, 2020 As at August 31, 2019 Level 1 Level 2 Level 1 Level 2 Financial assets Short-term investments $ 919 $ – $ 2,918 $ – Forward exchange contracts $ – $ 1,587 $ – $ 79 Financial liabilities Forward exchange contracts $ – $ 110 $ – $ 1,057 Valuation techniques used to value financial instruments are as follows: The fair value of the long-term debt is estimated by discounting expected cash flows at rates currently offered to the company for debts of the same remaining maturities and conditions. The fair value of forward exchange contracts is based on the amount at which they could be settled based on estimated current market rates. Market risk Currency risk The functional currency of the company is the Canadian dollar. The company is exposed to currency risk as a result of its export sales of products manufactured in Canada, China, France and Finland, the majority of which are denominated in US dollars and euros. This risk is partially hedged by forward exchange contracts and certain cost of sales and operating expenses (US dollars and euros). In addition, the company is exposed to currency risk as a result of its research and development activities in India (Indian rupees). This risk is partially hedged by forward exchange contracts. Forward exchange contracts, which are designated as cash flow hedging instruments, qualify for hedge accounting. As at August 31, 2019 and 2020, the company held contracts to sell US dollars for Canadian dollars and Indian rupees at various forward rates, which are summarized as follows: US dollars – Canadian dollars Expiry dates Contractual amounts Weighted average contractual forward rates As at August 31, 2019 September 2019 to August 2020 $ 35,500 1.3013 September 2020 to August 2021 19,900 1.3107 September 2021 to July 2022 6,000 1.3216 Total $ 61,400 1.3063 As at August 31, 2020 September 2020 to August 2021 $ 36,100 1.3283 September 2021 to August 2022 18,800 1.3492 September 2022 to February 2023 3,600 1.3324 Total $ 58,500 1.3353 US dollars – Indian rupees Expiry dates Contractual amount Weighted average contractual forward rate As at August 31, 2019 September 2019 to August 2020 $ 3,500 71.48 As at August 31, 2020 September 2020 to February 2021 $ 1,500 77.56 The carrying amount of forward exchange contracts is equal to fair value, which is based on the amount at which they could be settled based on estimated current market rates. As at August 31, 2020, forward exchange contracts in the amount of $1,018,000 are presented as current assets in other accounts receivable, forward exchange contracts in the amount of $569,000 are presented as long-term assets in other long-term assets, and forward exchange contracts in the amount of $110,000 are presented as current liabilities in accounts payable and accrued liabilities in the consolidated balance sheet. Forward exchange contracts of $40,000, included in other accounts receivable, for which related hedged sales are recognized, are recorded in the consolidated statement of earnings. Otherwise, other forward exchange contracts are not yet recorded in the consolidated statement of earnings and are recorded in other comprehensive income. As at August 31, 2019, forward exchange contracts in the amount of $79,000 are presented as current assets in other accounts receivable, forward exchange contracts in the amount of $845,000 are presented as current liabilities in accounts payable and accrued liabilities, and forward exchange contracts in the amount of $212,000 are presented as long-term liabilities in other long-term liabilities in the consolidated balance sheet. Forward exchange contracts of $167,000, included in other accounts payable and accrued liabilities, for which related hedged sales were recognized, were recorded in the consolidated statement of earnings. Otherwise, other forward exchange contracts were not yet recorded in the consolidated statement of earnings and are recorded in other comprehensive income. Based on the portfolio of forward exchange contracts as at August 31, 2020, the company estimates that the portion of net unrealized gains on these contracts as of that date, which will be realized and reclassified from accumulated other comprehensive loss to net earnings over the next 12 months, amounts to $868,000. For the years ended August 31, 2018, 2019 and 2020, the company recorded within its sales the following foreign exchange gains (losses) on forward exchange contracts: Years ended August 31, 2020 2019 2018 Gains (losses) on forward exchange contracts $ (1,028 ) $ (591 ) $ 875 The following table summarizes significant derivative and non-derivative financial assets and financial liabilities that are subject to currency risk as at August 31, 2019 and 2020 and for which such risk is charged to earnings: As at August 31, 2020 2019 Carrying/nominal amount (in thousands of US dollars) Carrying/nominal amount (in thousands of euros) Carrying/nominal amount (in thousands of US dollars) Carrying/nominal amount (in thousands of euros) Financial assets Cash $ 10,147 € 8,152 $ 5,531 € 3,129 Accounts receivable 33,681 8,807 30,451 6,389 43,828 16,959 35,982 9,518 Financial liabilities Bank loan 22,000 – 5,000 – Accounts payable and accrued liabilities 8,683 1,693 12,563 2,218 Forward exchange contracts (nominal value) 6,100 – 5,800 – 36,783 1,693 23,363 2,218 Net exposure $ 7,045 € 15,266 $ 12,619 € 7,300 In addition to these assets and liabilities, the company has derivative financial liabilities for its outstanding forward exchange contracts in the amount (nominal value) of $61,400,000 and $58,500,000 as at August 31, 2019 and 2020 respectively for which the currency risk is charged to other comprehensive income. The value of the Canadian dollar compared to the US dollar was CA$1.3294 = US$1.00 and CA$1.3041 = US$1.00 as at August 31, 2019 and 2020 respectively. The value of the Canadian dollar compared to the euro was CA$1.4672 = €1.00 and CA$1.5571 = €1.00 as at August 31, 2019 and 2020 respectively. The following sensitivity analysis summarizes the effect that a change in the value of the Canadian dollar (compared to the US dollar and euro) on derivative and non-derivative financial assets and financial liabilities denominated in US dollars and euros would have on the net loss, net loss per diluted share and comprehensive income, based on the foreign exchange rates as at August 31, 2019 and 2020: • An increase (decrease) of 10% in the period-end value of the Canadian dollar compared to the US dollar would increase (decrease) the net loss by $1,166,000, or $0.02 per share, and $962,000, or $0.02 per share, as at August 31, 2019 and 2020 respectively. • An increase (decrease) of 10% in the period-end value of the Canadian dollar compared to the euro would increase (decrease) the net loss by $796,000, or $0.01 per share, and $1,496,000 or $0.03 per share, as at August 31, 2019 and 2020 respectively. • An increase (decrease) of 10% in the period-end value of the Canadian dollar compared to the US dollar would increase (decrease) other comprehensive loss by $4,072,000 and $3,769,000 as at August 31, 2019 and 2020 respectively. The impact of the change in the value of the Canadian dollar compared to the US dollar and the euro on these derivative and non-derivative financial assets and financial liabilities is recorded in the foreign exchange gain or loss line item in the consolidated statements of earnings, except for outstanding forward contracts, and except for those of foreign operations, whose impact is recorded in other comprehensive income. The change in the value of the Canadian dollar compared to the US dollar and the euro also affects the company’s balances of income tax recoverable or payable, as well as deferred income tax assets and liabilities denominated in US dollars and euros; this may result in additional and significant foreign exchange gains or losses. However, these tax-related assets and liabilities are not considered financial instruments and are therefore excluded from the sensitivity analysis above. The foreign exchange rate fluctuations also flow through the consolidated statements of earnings line items, as a significant portion of the company’s cost of sales and operating expenses are denominated in Canadian dollars, euros, British pounds and Indian rupees, and the company reports its results in US dollars; that effect is not reflected in the sensitivity analysis above. Interest rate risk The company has limited exposure to interest rate risk. The company is mainly exposed to interest rate risks through its cash, short-term investments, bank loan, long-term debt and other liabilities. The company analyzes its interest risk exposure on an ongoing basis. A change in interest rate of 1% would have an insignificant impact on net loss and comprehensive loss. Short-term investments Short-term investments consist of the following: As at August 31, 2020 2019 Term deposits denominated in Indian rupees, bearing interest at annual rates of 5.1% to 7.0% in 2019 and 3.0% to 6.3% in 2020, maturing on different dates between September 2019 and May 2020 in 2019 and December 2020 and February 2023 in 2020 $ 728 $ 2,548 Other 191 370 $ 919 $ 2,918 Due to their short-term maturity, the company’s short-term investments are not subject to a significant fair value interest rate risk. Accordingly, changes in fair value have been nominal to the degree that amortized cost approximates the fair value. Any change in the fair value of the company’s short-term investments, all of which are classified as financial assets at fair value through other comprehensive income, is recorded in the consolidated statements of comprehensive income. Other financial instruments Short-term other liabilities bear interest at EURIBOR, plus a margin. Accounts receivable and accounts payable and accrued liabilities are non-interest-bearing financial assets and financial liabilities. Credit risk Financial instruments that potentially subject the company to credit risk consist of cash, short-term investments, accounts receivable, other assets and forward exchange contracts (with a positive fair value). As at August 31, 2020, the company’s short-term investments consist of debt instruments issued by high-credit-quality corporations. These debt instruments are not expected to be affected by a significant credit risk. The company’s cash and forward exchange contracts are held with or issued by high-credit-quality financial institutions; therefore, the company considers the risk of non-performance on these instruments to be limited. The company applies the IFRS 9 simplified approach to measuring expected credit losses, which uses a lifetime expected loss allowance for all trade accounts receivable and contract assets. To measure the expected credit losses, trade accounts receivable and contract assets have been grouped based on shared credit risk characteristics and the days past due. The contract assets relate to unbilled work in progress and have substantially the same risk characteristics as the trade accounts receivable for the same type of contracts. The company has therefore concluded that the expected loss rates for trade accounts receivable are a reasonable approximation of the loss rates for the contract assets. The expected loss rates are based on the payment profiles of sales over a period of 60 months. The historical loss rates are adjusted to reflect current and forward-looking information on economic factors affecting the ability of the customers to settle the accounts receivable. For the years ended August 31, 2018, 2019 and 2020, no customer represented more than 10% of sales. The following table summarizes the age of trade accounts receivable: As at August 31, 2020 2019 Current $ 40,595 $ 39,054 Past due, 0 to 30 days 7,622 3,529 Past due, 31 to 60 days 1,677 2,006 Past due, more than 60 days 6,397 6,928 $ 56,291 $ 51,517 Changes in the allowance for doubtful accounts are as follows: Years ended August 31, 2020 2019 Balance – Beginning of year $ 1,535 $ 772 IFRS 9 adoption initial adjustment – 303 Addition charged to net loss 1,173 864 Write-off of uncollectible accounts and reversal (953 ) (404 ) Balance – End of year $ 1,755 $ 1,535 Liquidity risk Liquidity risk is defined as the potential that the company cannot meet its obligations as they become due. The following tables summarize the contractual maturity of the company’s derivative and non-derivative financial liabilities: As at August 31, 2020 No later than one year Later than 1 year and no later than 5 years Bank loan $ 32,737 $ – Accounts payable and accrued liabilities 41,238 – Forward exchange contracts Outflow 37,600 22,400 Inflow (38,364 ) (23,128 ) Long-term debt 2,076 2,144 Other liabilities 4,032 – Total $ 79,319 $ 1,416 As at August 31, 2019 No later than one year Later than 1 year and no later than 5 years Later than 5 years Bank loan $ 5,000 $ – $ – Accounts payable and accrued liabilities 49,945 – – Forward exchange contracts Outflow 39,000 25,900 – Inflow (38,252 ) (25,585 ) – Long-term debt 2,449 3,237 56 Other liabilities 1,606 – – Total $ 59,748 $ 3,552 $ 56 As at August 31, 2020, the company had $33,737,000 in cash and short-term investments and $60,346,000 in accounts receivable. In addition to these financial assets, the company has unused available lines of credit totaling $44,485,000 for working capital and general corporate purposes, including potential acquisitions as well as unused lines of credit totaling $22,416,000 for foreign currency exposure related to its forward exchange contracts (note 11). |
Inventories
Inventories | 12 Months Ended |
Aug. 31, 2020 | |
Inventories [Abstract] | |
Inventories | 7 Inventories As at August 31, 2020 2019 Raw materials $ 22,487 $ 24,115 Work in progress 3,846 1,009 Finished goods 12,532 12,893 $ 38,865 $ 38,017 The cost of sales comprised almost exclusively the amount of inventory recognized as an expense during the reporting years, and amounts to $116,923,000, $127,725,000 and $122,679,000 for the years ended August 31, 2018, 2019 and 2020 respectively, including related depreciation and amortization, which are shown separately in operating expenses (note 20). Inventory write-down amounted to $2,541,000, $3,270,000 and $2,629,000 for the years ended August 31, 2018, 2019 and 2020 respectively. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Aug. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | 8 Property, Plant and Equipment Land and land improvements Buildings Equipment Leasehold improvements Total Cost as at September 1, 2018 $ 4,359 $ 32,346 $ 39,088 $ 3,048 $ 78,841 Additions – 1,116 3,700 164 4,980 Disposals (192 ) (3,378 ) (4,623 ) (164 ) (8,357 ) Foreign currency translation adjustment (76 ) (592 ) (1,329 ) (153 ) (2,150 ) Cost as at August 31, 2019 4,091 29,492 36,836 2,895 73,314 Additions – 933 3,949 137 5,019 Disposals – (31 ) (1,120 ) (10 ) (1,161 ) Foreign currency translation adjustment 79 591 1,080 126 1,876 Cost as at August 31, 2020 $ 4,170 $ 30,985 $ 40,745 $ 3,148 $ 79,048 Accumulated depreciation as at September 1, 2018 $ 1,290 $ 6,661 $ 25,163 $ 1,417 $ 34,531 Depreciation for the year 47 667 4,391 364 5,469 Disposals – (1,452 ) (3,673 ) (114 ) (5,239 ) Foreign currency translation adjustment (53 ) (120 ) (602 ) (36 ) (811 ) Accumulated depreciation as at August 31, 2019 1,284 5,756 25,279 1,631 33,950 Depreciation for the year 46 686 4,449 382 5,563 Disposals – (31 ) (1,120 ) (10 ) (1,161 ) Foreign currency translation adjustment 26 147 767 34 974 Accumulated depreciation as at August 31, 2020 $ 1,356 $ 6,558 $ 29,375 $ 2,037 $ 39,326 Net carrying value as at: August 31, 2019 $ 2,807 $ 23,736 $ 11,557 $ 1,264 $ 39,364 August 31, 2020 $ 2,814 $ 24,427 $ 11,370 $ 1,111 $ 39,722 As at August 31, 2019 and 2020, unpaid additions to property, plant and equipment amounted to $894,000 and $92,000 respectively. |
Lease Right-of-Use Assets
Lease Right-of-Use Assets | 12 Months Ended |
Aug. 31, 2020 | |
Lease Right-of-Use Assets [Abstract] | |
Lease Right-of-Use Assets | 9 Lease Right-of-Use Assets The company has operating leases for certain of its premises under various non-cancelable lease agreements that are accounted for under IFRS 16 since September 1, 2019 (note 2). The following table summarizes the change in cost and accumulated amortization of lease ROU assets for these premises: Cost as at September 1, 2019 $ – Adoption of IFRS 16 (note 2) 11,321 Additions 2,103 Foreign currency translation adjustment 555 Cost as at August 31, 2020 $ 13,979 Accumulated depreciation as at September 1, 2019 $ – Depreciation for the year (note 20) 3,349 Foreign currency translation adjustment (128 ) Accumulated depreciation as at August 31, 2020 $ 3,221 Net carrying value as at August 31, 2020 $ 10,758 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Aug. 31, 2020 | |
Intangible Assets and Goodwill [Abstract] | |
Intangible Assets and Goodwill | 10 Intangible Assets and Goodwill Intangible assets Core technology Customer relationships In-process research and development Brand name Software Total Cost as at September 1, 2018 $ 28,058 $ 10,291 $ 292 $ 796 $ 12,660 $ 52,097 Additions 363 – – – 1,719 2,082 Disposal (27 ) – (293 ) – (222 ) (542 ) Foreign currency translation adjustment (1,955 ) (618 ) 1 (46 ) (240 ) (2,858 ) Cost as at August 31, 2019 26,439 9,673 – 750 13,917 50,779 Additions 427 – – – 1,398 1,825 Disposal (181 ) – – (812 ) (2,222 ) (3,215 ) Foreign currency translation adjustment 1,939 561 – 62 461 3,023 Cost as at August 31, 2020 $ 28,624 $ 10,234 $ – $ – $ 13,554 $ 52,412 Accumulated amortization as at September 1, 2018 $ 9,610 $ 3,933 $ – $ 512 $ 8,176 $ 22,231 Amortization for the year 4,926 2,372 – 284 1,430 9,012 Disposal (19 ) – – – (219 ) (238 ) Foreign currency translation adjustment (1,080 ) (424 ) – (46 ) (330 ) (1,880 ) Accumulated amortization as at August 31, 2019 13,437 5,881 – 750 9,057 29,125 Amortization for the year 3,946 1,259 – – 1,262 6,467 Disposal (111 ) – – (812 ) (2,069 ) (2,992 ) Foreign currency translation adjustment 1,230 600 – 62 304 2,196 Accumulated amortization as at August 31, 2020 $ 18,502 $ 7,740 $ – $ – $ 8,554 $ 34,796 Net carrying value as at: August 31, 2019 $ 13,002 $ 3,792 $ – $ – $ 4,860 $ 21,654 August 31, 2020 $ 10,122 $ 2,494 $ – $ – $ 5,000 $ 17,616 Remaining amortization period as at August 31, 2020 3 years 1 year – – 3 years Goodwill Years ended August 31, 2020 2019 Balance – Beginning of year $ 38,648 $ 39,892 Foreign currency translation adjustment 1,642 (1,244 ) Balance – End of year $ 40,290 $ 38,648 Goodwill has been allocated to the lowest level within the company at which it is monitored by management to make business decisions, which are the following CGUs: As at August 31, 2020 2019 EXFO CGU $ 13,200 $ 12,949 EXFO Optics CGU 3,648 3,376 Service assurance, systems and services CGU 23,442 22,323 Total $ 40,290 $ 38,648 The company elected to perform its annual goodwill impairment testing in the fourth quarter of each fiscal year for all CGUs. In fiscal 2020, the coronavirus pandemic had a negative impact on the company’s sales and operating results, and the company believes it may continue to negatively impact its sales and operating results to a certain extent over an undetermined period, depending on the evolution of the pandemic and its treatment, if any. In addition, since the beginning of the coronavirus outbreak, the company’s stock price has been significantly fluctuating. As a result of these impacts, during the third quarter of fiscal 2020, the company concluded that they represented a triggering event and performed goodwill impairment testing for all CGUs as at May 31, 2020. The company also performed its annual goodwill impairment test as at August 31, 2020. In performing the goodwill impairment review of its CGUs as at May 31, 2020 and August 31, 2020, the company determined the recoverable amount of goodwill based on fair value less costs of disposal. In estimating the recoverable amount of EXFO Optics CGU, the company used a capitalized cash flows method. In addition, for the Service assurance, systems and services (SASS) CGU, the company used a cost approach based on the level of research and development expenses incurred over the last two years. Finally, as the sales and operations of the EXFO CGU constitutes the significant majority of the company’s sales and operations, the company compared the carrying amount of the EXFO CGU to the company’s overall market capitalization, after adjustment for a control premium and the adjustment to deduct the recoverable amount of the EXFO Optics and SASS CGUs. As at May 31 and August 31, 2020, the recoverable amount for all CGUs exceeded their carrying value. |
Credit Facilities
Credit Facilities | 12 Months Ended |
Aug. 31, 2020 | |
Credit Facilities [Abstract] | |
Credit Facilities | 11 Credit Facilities The company had revolving credit facilities that provided for advances of up to CA$70,000,000 (US$53,677,000) and US$9,000,000 until May 2020. In May 2020, the company modified these revolving credit facilities, whereby maximum advances were extended from CA$70,000,000 (US$53,677,000) to CA$90,000,000 (US$69,013,000) until May 31, 2021, to return to CA$70,000,000 on June 1, 2021. The revolving credit facility that provides advances up to US$9,000,000 remained unchanged. These credit facilities are used to finance working capital and for other general corporate purposes. The Canadian dollar revolving credit facility bears interest at the Canadian prime rate or LIBOR, plus a margin, and the US dollar revolving credit facility bears interest at the US prime rate or LIBOR plus a margin. These revolving credit facilities are secured by a movable mortgage over the universality of the company’s Canadian movable assets, present and future, as well as over the universality of movable assets, present and future, of certain US and UK subsidiaries. The company is subject to covenants under this credit facility that were met as at August 31, 2020. As at August 31, 2020, an amount of $33,783,000 was drawn from these credit facilities for the bank loan of $32,737,000 and letters of guarantee of $1,046,000. The company also has credit facilities of up to €400,000 (US$478,000) for which an amount of €187,000 (US$223,000) was drawn from these lines of credit for letters of guarantee. These credit facilities are unsecured and bear interest at EURIBOR, plus a margin. In addition, the company has lines of credit totaling $23,719,000 for the foreign currency risk exposure related to its US dollar – Canadian dollar forward exchange contracts (note 6). As at August 31, 2020, an amount of $3,093,000 was reserved from these lines of credit. Finally, the company has a line of credit of INR131,387,000 (US$1,800,000) for the foreign currency risk exposure related to its US dollar – Indian rupee forward exchange contracts (note 6). As at August 31, 2020, an amount of INR730,000 (US$10,000) was reserved from this line of credit. |
Accounts Payable and Accrued Li
Accounts Payable and Accrued Liabilities and Provisions | 12 Months Ended |
Aug. 31, 2020 | |
Accounts Payable and Accrued Liabilities and Provisions [Abstract] | |
Accounts Payable and Accrued Liabilities and Provisions | 12 Accounts Payable and Accrued Liabilities and Provisions Accounts payable and accrued liabilities As at August 31, 2020 2019 Trade $ 21,407 $ 27,996 Salaries and social benefits 17,998 19,716 Forward exchange contracts (note 6) 110 845 Other 1,833 2,233 $ 41,348 $ 50,790 Provisions As at August 31, 2020 2019 Warranty $ 380 $ 356 Restructuring charges (note 4) 3,626 1,133 Other 2,568 2,313 $ 6,574 $ 3,802 |
Leases
Leases | 12 Months Ended |
Aug. 31, 2020 | |
Leases [Abstract] | |
Leases | 13 Leases The company has operating leases for certain of its premises under various non-cancelable lease agreements that have been accounted for under IFRS 16 since September 1, 2019 (note 2). The company’s operating leases have remaining lease terms ranging from one year to eight years. The company’s operating lease agreements do not contain any material residual value guarantees or material restrictive covenants. Minimal rentals payable under operating leases are as follows as at August 31, 2020: No later than 1 year $ 3,249 Later than 1 year and no later than 5 years 6,377 Later than 5 years 957 Total lease liabilities as at August 31, 2020 $ 10,583 The difference between operating lease commitments disclosed applying IAS 17 as at August 31, 2019, discounted using the incremental borrowing rate of 2% at the date of the initial application of IFRS 16 as at September 1, 2019, and the lease liabilities recognized in the consolidated balance sheet as at that date is as follows: Discounted operating lease commitments under IAS 17 as at August 31, 2019 $ 8,915 Discounted impact of renewal options that are reasonably certain to be exercised 1,928 Lease liabilities as at September 1, 2019 under IFRS 16 $ 10,843 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Aug. 31, 2020 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | 14 Long-Term Debt As at August 31, 2020 2019 Unsecured, non-interest-bearing loans, denominated in euros, repayable in quarterly instalments, maturing in March 2024 and March 2025 $ 896 $ 866 Unsecured loans, denominated in euros, repayable in monthly, quarterly or bi‑annual instalments, bearing interest at annual rates of nil to 5.0%, maturing at different dates between March 2020 and September 2023 in 2019 and December 2020 and September 2023 in 2020 2,443 3,111 Loans, secured by the universality of the assets of a subsidiary, denominated in euros, repayable in monthly instalments, bearing interest at annual rates of 0.7% to 1.5%, maturing at different dates between April 2020 and August 2022 in 2019 and February 2021 and August 2022 in 2020 295 459 Loans, secured by the universality of the assets of a subsidiary, denominated in euros, repayable in monthly or quarterly instalments, bearing interest at annual rates of 1.1% to 2.9%, maturing at different dates between March 2020 and July 2022 in 2019 and December 2020 and July 2022 in 2020 586 1,306 4,220 5,742 Current portion of long-term debt 2,076 2,449 $ 2,144 $ 3,293 The company is subject to certain covenants under its long-term debt that were met as at August 31, 2020. Principal repayments of long-term debt due over the forthcoming years are as follows as at August 31, 2020: No later than one year $ 2,076 Later than one year and no later than five years 2,144 $ 4,220 |
Commitments
Commitments | 12 Months Ended |
Aug. 31, 2020 | |
Commitments [Abstract] | |
Commitments | 15 Commitments The company entered into license agreements for certain intellectual property, which expire at various dates through 2025. Minimum payments for these agreements are as follows as at August 31, 2020: No later than one year $ 1,779 Later than one year and no later than five years 621 $ 2,400 |
Share Capital
Share Capital | 12 Months Ended |
Aug. 31, 2020 | |
Share Capital [Abstract] | |
Share Capital | 16 Share Capital Authorized – unlimited as to number, without par value Subordinate voting and participating, bearing a non-cumulative dividend to be determined by the Board of Directors, ranking pari passu Multiple voting and participating, entitling to 10 votes each, bearing a non-cumulative dividend to be determined by the Board of Directors, convertible at the holder’s option into subordinate voting shares on a one-for-one basis, ranking pari passu The following table summarizes the company’s share capital activity: Multiple Voting Shares Subordinate Voting Shares Number Amount Number Amount Total amount Balance as at September 1, 2017 31,643,000 $ 1 23,068,777 $ 90,410 $ 90,411 Redemption of restricted share units (note 18) – – 345,883 – – Redemption of deferred share units (note 18) – – 58,335 – – Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,526 1,526 Balance as at August 31, 2018 31,643,000 1 23,472,995 91,936 91,937 Redemption of restricted share units (note 18) – – 317,072 – – Redemption of share capital – – (86,392 ) (337 ) (337 ) Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,106 1,106 Balance as at August 31, 2019 31,643,000 1 23,703,675 92,705 92,706 Redemption of restricted share units (note 18) – – 411,619 – – Redemption of share capital – – (54,528 ) (212 ) (212 ) Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,530 1,530 Balance as at August 31, 2020 31,643,000 $ 1 24,060,766 $ 94,023 $ 94,024 a) On January 8, 2019, the company announced that its Board of Directors had approved a share repurchase program, by way of a normal course issuer bid on the open market of up to 6.3% of the issued and outstanding subordinate voting shares, representing 1,200,000 subordinate voting shares at the prevailing market price. The normal course issuer bid started on January 14, 2019 and ended on January 13, 2020. All shares repurchased under the bid were canceled. b) On January 7, 2020, the company announced that its Board of Directors had approved a share repurchase program, by way of a normal course issuer bid on the open market of up to 3.1% of the issued and outstanding subordinate voting shares, representing 600,000 subordinate voting shares at the prevailing market price. The normal course issuer bid started on January 14, 2020 and will end on January 13, 2021 or earlier if the company repurchases the maximum number of shares permitted. All shares repurchased under the bid will be canceled. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Aug. 31, 2020 | |
Accumulated Other Comprehensive Loss [Abstract] | |
Accumulated Other Comprehensive Loss | 17 Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss are as follows: Foreign currency translation adjustment Cash-flow hedge Accumulated other comprehensive loss Balance as at September 1, 2017 $ (40,874 ) $ 1,909 $ (38,965 ) Foreign currency translation adjustment (6,491 ) – (6,491 ) Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – (1,894 ) (1,894 ) Balance as at August 31, 2018 (47,365 ) 15 (47,350 ) Foreign currency translation adjustment (4,177 ) – (4,177 ) Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – 16 16 Balance as at August 31, 2019 (51,542 ) 31 (51,511 ) Foreign currency translation adjustment 5,994 – 5,994 Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – 1,743 1,743 Balance as at August 31, 2020 $ (45,548 ) $ 1,774 $ (43,774 ) |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Aug. 31, 2020 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-Based Compensation Plans | 18 Stock-Based Compensation Plans The following table summarizes the stock-based compensation costs recognized for employee services received during the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Stock-based compensation costs arising from equity-settled awards $ 2,027 $ 1,849 $ 1,770 Stock-based compensation costs arising from cash-settled awards (6 ) (18 ) (22 ) $ 2,021 $ 1,831 $ 1,748 The maximum number of additional subordinate voting shares issuable under the Long-Term Incentive Plan and the Deferred Share Unit Plan cannot exceed 11,792,893 shares. The maximum number of subordinate voting shares that may be granted to any individual on an annual basis cannot exceed 5% of the number of outstanding subordinate voting shares. The company settles equity-settled awards through the issuance of common shares from treasury. Long-Term Incentive Plan The company established the Long-Term Incentive Plan for its directors, executive officers and employees and those of its subsidiaries, as determined by the Board of Directors. Up to January 2019, the plan included stock options and restricted share units. In January 2019, the plan was amended to include performance share units. The plan was approved by the shareholders of the company. Stock options The exercise price of stock options granted under the Long-Term Incentive Plan is the market price of the common shares on the date of grant. Stock options granted under the plan expire 10 years from the date of grant and generally vest over a four-year period, being the required period of service from employees, generally with 25% vesting on an annual basis commencing on the first anniversary of the date of grant. As at August 31, 2019 and 2020, the company had no outstanding or exercisable stock options. Restricted share units (RSUs) RSUs are stock awards that rise and fall in value based on the market price of the company’s subordinate voting shares and are redeemable for actual subordinate voting shares. Vesting dates are also established by the Board of Directors on the date of grant. The vesting dates are subject to a minimum term of three years and a maximum term of 10 years from the award date, being the required period of service from employees. The fair value of RSUs equals the market price of the common shares on the date of grant. The following table summarizes RSU activity for the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Outstanding – Beginning of year 1,836,446 1,615,152 1,611,330 Granted 439,220 632,931 420,621 Redeemed (411,619 ) (317,072 ) (345,883 ) Forfeited (150,932 ) (94,565 ) (70,916 ) Outstanding – End of year 1,713,115 1,836,446 1,615,152 None of the RSUs outstanding as at August 31, 2019 and 2020 were redeemable. The weighted-average grant-date fair value of RSUs granted during the years ended August 31, 2018, 2019 and 2020 amounted to $4.22, $3.30 and $4.02 respectively. The weighted-average market price of the shares at the date of redemption of RSUs redeemed during the years ended August 31, 2018, 2019 and 2020, was $4.19, $3.20 and $3.92 respectively. Performance share units (PSUs) PSUs are stock awards that rise and fall in value based on the market price of the company’s subordinate voting shares and are redeemable for actual subordinate voting shares. Vesting dates are also established by the Board of Directors on the date of grant. The vesting dates are subject to a minimum term of three years and a maximum term of 10 years from the award date, being the required period of service from employees. The fair value of PSUs equals the market price of the common shares on the date of grant. The ultimate number of PSUs to be granted is subject to the attainment of targets on the vesting date. The following table summarizes PSU activity for the year ended August 31, 2020: Outstanding – Beginning of year – Granted 143,251 Outstanding – End of year 143,251 None of the PSUs outstanding as at August 31, 2020 were redeemable. The weighted-average grant-date fair value of PSUs granted during the year ended August 31, 2020 amounted to $3.84. Deferred Share Unit Plan The company established a Deferred Share Unit (DSU) Plan for the members of the Board of Directors as part of their annual retainer fees. Each DSU entitles the Board members to receive one subordinate voting share. DSUs are acquired on the date of grant and are redeemed in subordinate voting shares when the Board member ceases to be a director of the company. This plan was approved by the shareholders of the company. The following table summarizes DSU activity for the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Outstanding – Beginning of year 251,507 181,689 174,279 Granted 79,819 69,818 65,745 Redeemed – – (58,335 ) Outstanding – End of year 331,326 251,507 181,689 As at August 31, 2018, 2019 and 2020, none of the DSUs outstanding were redeemable. The weighted average grant-date fair value of DSUs granted during the years ended August 31, 2018, 2019 and 2020 amounted to $4.10, $3.64 and $3.43 respectively. The weighted-average market price of the shares at the date of redemption of DSUs redeemed during the year ended August 31, 2018 was $4.29. Stock Appreciation Rights Plan The company established the Stock Appreciation Rights Plan for certain employees. Under that plan, eligible employees are entitled to receive a cash amount equivalent to the difference between the market price of the common shares on the date of exercise and the exercise price determined on the date of grant. Stock appreciation rights granted under the plan expire 10 years from the date of grant and generally vest over a four-year period, being the required period of service from employees. This plan was approved by the shareholders of the company. The liability arising from stock appreciation rights as at August 31, 2019 and 2020 amounted to $77,000 and $70,000 respectively and is recorded in accounts payable and accrued liabilities in the consolidated balance sheets. Stock appreciation rights are immaterial to the company’s consolidated financial statements. |
Related Party Disclosures
Related Party Disclosures | 12 Months Ended |
Aug. 31, 2020 | |
Related Party Disclosures [Abstract] | |
Related Party Disclosures | 19 Related Party Disclosures Ultimate controlling shareholder Mr. Germain Lamonde, the company’s Executive Chairman, is the company’s ultimate controlling shareholder. Compensation of key management personnel Years ended August 31, 2020 2019 2018 Salaries and short-term employee benefits $ 4,086 $ 4,029 $ 3,985 Stock-based compensation costs 1,391 1,175 1,047 $ 5,477 $ 5,204 $ 5,032 Key management personnel includes senior management and directors. |
Statements of Earnings
Statements of Earnings | 12 Months Ended |
Aug. 31, 2020 | |
Statements of Earnings [Abstract] | |
Statements of Earnings | 20 Statements of Earnings Sales Sales are as follows: Years ended August 31, 2020 2019 2018 Test and measurement $ 197,419 $ 204,693 $ 197,423 Service assurance, systems and services 69,192 82,788 71,248 Foreign exchange gains (losses) on forward exchange contracts (1,028 ) (591 ) 875 Total sales for the year $ 265,583 $ 286,890 $ 269,546 Net research and development Net research and development expenses comprise the following: Years ended August 31, 2020 2019 2018 Gross research and development expenses $ 54,564 $ 57,972 $ 65,243 Research and development tax credits and grants (9,077 ) (7,419 ) (8,089 ) Net research and development expenses for the year $ 45,487 $ 50,553 $ 57,154 For the year ended August 31, 2020, tax credits and grants include $1,457,000 for the CEWS (nil in 2018 and 2019). Depreciation and amortization Depreciation and amortization expenses by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales Depreciation of property, plant and equipment $ 1,923 $ 1,862 $ 2,077 Depreciation of lease ROU assets 1,106 – – Amortization of intangible assets 5,092 7,186 9,212 8,121 9,048 11,289 Selling and administrative expenses Depreciation of property, plant and equipment 1,080 1,354 902 Depreciation of lease ROU assets 1,472 – – Amortization of intangible assets 698 1,043 592 3,250 2,397 1,494 Net research and development expenses Depreciation of property, plant and equipment 2,560 2,253 2,465 Depreciation of lease ROU assets 771 – – Amortization of intangible assets 677 783 523 4,008 3,036 2,988 $ 15,379 $ 14,481 $ 15,771 Depreciation of property, plant and equipment $ 5,563 $ 5,469 $ 5,444 Depreciation of lease ROU assets 3,349 – – Amortization of intangible assets 6,467 9,012 10,327 Total depreciation and amortization expenses for the year $ 15,379 $ 14,481 $ 15,771 Employee compensation Employee compensation comprises the following: Years ended August 31, 2020 2019 2018 Salaries and benefits $ 142,277 $ 136,059 $ 134,453 Restructuring charges 2,808 3,305 2,072 Stock-based compensation costs 2,021 1,831 1,748 Grants (CEWS) (3,262 ) – – Total employee compensation for the year $ 143,844 $ 141,195 $ 138,273 Restructuring charges by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales $ 898 $ 304 $ 517 Selling and administrative expenses 1,882 495 673 Net research and development costs 106 2,506 3,219 Interest and other expense – – 150 2,886 3,305 4,559 Income taxes (533 ) (63 ) (1,150 ) Total restructuring charges for the year $ 2,353 $ 3,242 $ 3,409 Stock-based compensation costs by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales $ 129 $ 136 $ 143 Selling and administrative expenses 1,548 1,375 1,217 Net research and development expenses 344 320 388 Total stock-based compensation costs for the year $ 2,021 $ 1,831 $ 1,748 CEWS by functional area are as follows (note 3): Years ended August 31, 2020 2019 2018 Cost of sales $ (723 ) $ – $ – Selling and administrative expenses (1,082 ) – – Net research and development expenses (1,457 ) – – Total CEWS for the year $ (3,262 ) $ – $ – |
Other Disclosures
Other Disclosures | 12 Months Ended |
Aug. 31, 2020 | |
Other Disclosures [Abstract] | |
Other Disclosures | 21 Other Disclosures Other assets As at August 31, 2019 and 2020, the carrying value of contract assets amounted to $3,083,000 and $5,493,000 respectively and were presented in other current assets in the consolidated balance sheets. Contract assets represent unbilled work in progress. Deferred revenue As at August 31, 2020, the company had total deferred revenue of $34,643,000, which represents the aggregate total contract price allocated to undelivered performance obligations. The company expects to recognize $25,785,000 of this amount during the next 12 months and expects to recognize the remaining $8,858,000 thereafter. The company expects that the amount of deferred revenue will change from quarter to quarter for several reasons, including the specific timing, duration and size of large customer support and service agreements, varying billing cycles of such agreements, the specific timing of customer renewals, and foreign currency fluctuations. The company did not have any significant financing components, variable considerations or performance obligations satisfied in a prior period recognized during the year ended August 31, 2020. During the year ended August 31, 2020, sales included an amount of $24,422,000 that was included in the carrying value of deferred revenue as at August 31, 2019. During the year ended August 31, 2019, sales included an amount of $16,556,000 that was included in the carrying value of deferred revenue as at August 31, 2018. Defined contribution pension plans The company maintains separate defined contribution pension plans for certain eligible employees. These plans, which are accounted for on an accrual basis, are summarized as follows: • Canadian defined contribution pension plan The company maintains a plan for certain eligible employees residing in Canada, under which the company may elect to match the employees’ contributions up to a maximum of 4% of an employee’s gross salary. Cash contributions to this plan and expenses for the years ended August 31, 2018, 2019 and 2020, amounted to $1,610,000, $1,592,000 and $1,626,000 respectively. • US defined contribution pension plan (401K plan) The company maintains a 401K plan for eligible employees residing in the U.S. Under this plan, the company must contribute an amount equal to 3% of an employee’s current compensation. In addition, eligible employees may contribute up to the lesser of 1% of eligible compensation or the statutorily prescribed annual limit to the 401K plan. The 401K plan permits but does not require the company to make additional matching contributions to the 401K plan on behalf of the eligible participants, subject to a maximum of 50% of the first 6% of the participant’s current compensation subject to certain legislated maximum contribution limits. During the years ended August 31, 2018, 2019 and 2020, the company recorded cash contributions and expenses totaling $591,000, $460,000 and $464,000 respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Aug. 31, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | 22 Income Taxes The reconciliation of the income tax provision (recovery) calculated using the combined Canadian federal and provincial statutory income tax rate with the income tax provision in the consolidated financial statements is as follows: Years ended August 31, 2020 2019 2018 Income tax provision (recovery) at combined Canadian federal and provincial statutory tax rate ( 27 $ (950 ) $ 774 $ (1,775 ) Increase (decrease) due to: Foreign income/loss taxed at different rates 540 13 452 Non-deductible loss (non-taxable income) (457 ) 10 (69 ) Non-deductible expenses 697 594 1,285 Change in tax rates – – 167 Effect of the US tax reform (1) – – 1,528 Foreign exchange effect of translation of foreign subsidiaries in the functional currency 732 63 (16 ) Recognition of previously unrecognized deferred income tax assets (506 ) (2,383 ) (560 ) Utilization of previously unrecognized deferred income tax assets (13 ) (964 ) (627 ) Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses 5,369 5,761 6,100 Other 610 1,478 (807 ) Income tax provision for the year $ 6,022 $ 5,346 $ 5,678 (1) On December 22, 2017, the US tax reform (“Tax Cuts and Jobs Act”) was substantively enacted and reduces the maximum corporate income tax rate from 35% to 21%, effective January 1, 2018. Based on management’s estimate of deferred tax assets expected to be used in fiscal 2018 and beyond against taxable income in the United States, the company recorded a deferred income tax expense of $1,528,000 in the consolidated statement of earnings for the year ended August 31, 2018 to account for the effect of this substantively enacted tax rate. Years ended August 31, 2020 2019 2018 The income tax provision consists of the following: Current Current income taxes $ 5,365 $ 7,449 $ 4,310 Deferred Deferred income taxes relating to the origination and reversal of temporary differences (4,193 ) (4,517 ) (3,545 ) Benefit arising from previously unrecognized tax losses and deductible temporary differences (506 ) (2,383 ) (560 ) Utilization of previously unrecognized deferred income tax assets (13 ) (964 ) (627 ) (4,712 ) (7,864 ) (4,732 ) Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses 5,369 5,761 6,100 657 (2,103 ) 1,368 Income tax provision for the year $ 6,022 $ 5,346 $ 5,678 The changes in deferred income tax assets and liabilities for the year ended August 31, 2019 are as follows: Balance as at September 1, 2018 Credited (charged) to the statement of earnings Credited (charged) to shareholders’ equity Foreign currency translation adjustment Balance as at August 31, 2019 Deferred income tax assets Long-lived assets $ 1,925 $ 2,695 $ – $ (52 ) $ 4,568 Provisions and accruals 3,963 446 67 15 4,491 Deferred revenue 2,716 490 – (36 ) 3,170 Research and development expenses 2,524 (149 ) – (45 ) 2,330 Losses carried forward 5,073 (2,751 ) – (176 ) 2,146 Deferred income tax liabilities Long-lived assets (6,461 ) 1,710 – 345 (4,406 ) Research and development tax credits (10,936 ) (338 ) – 198 (11,076 ) Total $ (1,196 ) $ 2,103 $ 67 $ 249 $ 1,223 Classified as follows: Deferred income tax assets $ 4,714 $ 4,821 Deferred income tax liabilities (5,910 ) (3,598 ) $ (1,196 ) $ 1,223 The changes in deferred income tax assets and liabilities for the year ended August 31, 2020 are as follows: Balance as at September 1, 2019 Credited (charged) to the statement of earnings Credited (charged) to shareholders’ equity Foreign currency translation adjustment Balance as at August 31, 2020 Deferred income tax assets Long-lived assets $ 4,568 $ (804 ) $ – $ 71 $ 3,835 Provisions and accruals 4,491 (387 ) (578 ) 75 3,601 Deferred revenue 3,170 104 – 50 3,324 Research and development expenses 2,330 (47 ) – 44 2,327 Losses carried forward 2,146 (616 ) – 7 1,537 Deferred income tax liabilities Long-lived assets (4,406 ) 1,003 – (154 ) (3,557 ) Research and development tax credits (11,076 ) 90 – (208 ) (11,194 ) Total $ 1,223 $ (657 ) $ (578 ) $ (115 ) $ (127 ) Classified as follows: Deferred income tax assets $ 4,821 $ 3,633 Deferred income tax liabilities (3,598 ) (3,760 ) $ 1,223 $ (127 ) Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses are as follows: As at August 31, 2020 2019 Temporary deductible differences $ 163 $ 241 Losses carried forward 46,289 39,721 $ 46,452 $ 39,962 As at August 31, 2020, the year of expiry of operating losses for which no deferred income tax assets were recognized in the consolidated balance sheet are as follows, presented by tax jurisdiction: Year of expiry Finland France Spain United States United Kingdom 2021 $ 6,865 $ – $ – $ 1,074 $ – 2022 11,902 – – 7,435 – 2023 7,711 – – 1,972 – 2024 5,953 – – 1,351 – 2025 7,421 – – 1,351 – 2026 254 – – 1,351 – 2027 1,542 – – 1,351 – 2028 – – – 2,447 – 2030 1,516 – – 2,713 – 2031 – – – 109 – 2033 – – – 4,681 – 2034 – – – 4,851 – 2035 – – – 2,616 – 2036 – – – 8,501 – 2037 – – – 9,660 – 2038 – – – 7,997 – Indefinite – 58,516 6,414 – 8,267 $ 43,164 $ 58,516 $ 6,414 $ 59,460 $ 8,267 Furthermore, as at August 31, 2020, the company had available capital losses in Canada amounting to $50,081,000 (CA$65,311,000) at the federal level and $53,436,000 (CA$69,686,000) at the provincial level for which no deferred income tax assets were recognized. These losses can be carried forward indefinitely against capital gains. As at August 31, 2020, non-refundable research and development tax credits recognized in the consolidated balance sheet amounted to $ ,000. In order to recover these non-refundable research and development tax credits, the company needs to generate approximately $ ,000 (CA$ ,000) in pre-tax earnings at the Canadian federal level. To generate this level of pre-tax earnings at the Canadian federal level over the estimated recovery period of years, the company must generate a As at August 31, 2020, no income taxes were recognized on taxable temporary differences of $25,714, 000; such (1) Undistributed profits of its foreign subsidiaries will not be distributed in the foreseeable future; and (2) Undistributed profits of its domestic subsidiaries will not be taxable when distributed. |
Earnings per Share
Earnings per Share | 12 Months Ended |
Aug. 31, 2020 | |
Earnings per Share [Abstract] | |
Earnings per Share | 23 Earnings per Share The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding: Years ended August 31, 2020 2019 2018 Basic weighted average number of shares outstanding (000’s) 55,604 55,325 54,998 Plus dilutive effect of (000’s): Restricted share units – – – Deferred share units – – – Performance share units – – – Diluted weighted average number of shares outstanding (000’s) 55,604 55,325 54,998 Stock awards excluded from the calculation of the diluted weighted average number of shares outstanding because their exercise price was greater than the average market price of the common shares, or their inclusion would be antidilutive (000’s) 2,012 1,701 1,799 For the years ended August 31, 2018, 2019 and 2020, the diluted amount per share was the same amount as the basic amount per share since the dilutive effect of restricted share units and deferred share units was not included in the calculation; otherwise, the effect would have been antidilutive. Accordingly, the diluted amount per share for these periods was calculated using the basic weighted average number of shares outstanding. |
Segment Information
Segment Information | 12 Months Ended |
Aug. 31, 2020 | |
Segment Information [Abstract] | |
Segment Information | 24 Segment Information Sales to external customers by geographic region are detailed as follows: Years ended August 31, 2020 2019 2018 United States $ 99,595 $ 106,607 $ 100,225 Canada 16,508 15,913 18,425 Other 13,379 21,391 16,743 Americas 129,482 143,911 135,393 United Kingdom 16,170 16,438 17,508 Other 63,700 76,285 67,169 Europe, Middle East and Africa 79,870 92,723 84,677 China 35,727 27,620 20,724 Other 20,504 22,636 28,752 Asia-Pacific 56,231 50,256 49,476 $ 265,583 $ 286,890 $ 269,546 Sales were allocated to geographic regions based on the country of residence of the related customers. Long-lived assets by geographic region are detailed as follows: As at August 31, 2020 As at August 31, 2019 Property, plant and equipment Lease ROU assets Intangible assets Goodwill Property, plant and equipment Lease ROU assets Intangible assets Goodwill Canada $ 29,801 $ – $ 5,338 $ 17,827 $ 29,517 $ – $ 5,675 $ 17,487 Finland 487 153 455 8,713 331 – 446 8,547 France 2,027 3,526 9,971 6,055 1,896 – 12,788 5,600 United Kingdom 488 544 1,808 7,695 640 – 2,706 7,014 India 4,083 65 18 – 4,249 – 23 – China 2,785 4,211 24 – 2,667 – 16 – United States 6 1,857 – – 7 – – – Other 45 402 2 – 57 – – – $ 39,722 $ 10,758 $ 17,616 $ 40,290 $ 39,364 $ – $ 21,654 $ 38,648 |
Subsequent Event
Subsequent Event | 12 Months Ended |
Aug. 31, 2020 | |
Subsequent Event [Abstract] | |
Subsequent Event | 25 Subsequent Event On September 7, 2020, the company entered into a share swap agreement (SSA) to acquire all of the issued and outstanding shares of InOpticals Inc. (InOpticals), a Taiwan-based company that offers ultra-high-speed test instruments for the laboratory and manufacturing markets. The SSA is subject to closing conditions by Taiwanese regulatory authorities. The company expects the acquisition to close in the second quarter of fiscal 2021. The fair value of the total consideration for this acquisition is not expected to be material. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 12 Months Ended |
Aug. 31, 2020 | |
Basis of Presentation [Abstract] | |
IFRS Pronouncements Adopted in Fiscal 2020 | IFRS Pronouncements Adopted in Fiscal 2020 Leases IFRS 16, Leases, was issued in January 2016. IFRS 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract, i.e., the customer (lessee) and the supplier (lessor). IFRS 16 supersedes IAS 17, Leases, and related interpretations. Under IFRS 16, lessees recognize a lease right-of-use (ROU) asset and a lease liability measured at the present value of lease payments for virtually all their leases. Short-term leases with a term of 12 months or less are not required to be recognized. This new standard is effective for annual periods beginning on or after January 1, 2019. The company adopted this new standard on September 1, 2019, using the modified retrospective method, which did not require adjustments to comparative periods. The company applied IFRS 16 at the adoption date and recognized lease ROU assets and lease liabilities in the year of adoption. The new standard provides several optional practical expedients in transition. Upon implementation of the new standard, the company elected the practical expedients to combine lease and non-lease components and to not recognize lease ROU assets and lease liabilities for short-term leases and low-value assets. Also, contracts that were not identified as leases under previous standards were not reassessed for whether there is a lease therein. The company identified appropriate changes to its accounting policies, information technology systems, business processes, and related internal controls to support recognition and disclosure requirements under IFRS 16. The adoption of IFRS 16 on September 1, 2019 resulted in the recognition of lease ROU assets of $11,321,000, lease liabilities of $10,843,000, and the elimination of prepaid rent of $478,000 in the consolidated balance sheet as of that date. In addition, lease payments, previously reported in cash flows from operating activities, are now reported in cash flows from financing activities in the consolidated statements of cash flows. However, the adoption of this standard had no significant impact on net loss. Upon the adoption of IFRS 16, the lease expense, previously recorded under the cost of sales, selling and administrative expenses and net research and development expenses line items, is recorded as depreciation expenses for the lease ROU assets and as interest expenses on the lease liabilities in the consolidated statements of earnings. Finally, the adoption of IFRS 16 had no significant impact on liquidity and debt covenant compliance under existing debt agreements. Uncertainty over Income Tax Treatments IFRIC 23, Uncertainty over Income Tax Treatments, was issued in June 2017. IFRIC 23 provides guidance on how to value uncertain income tax positions based on the probability of whether the relevant tax authorities will accept the company’s tax treatments. A company is to assume that a taxation authority with the right to examine any amounts reported to it will examine those amounts and will have full knowledge of all relevant information when doing so. IFRIC 23 is effective for annual periods beginning on or after January 1, 2019. The company adopted this interpretation on September 1, 2019, and its adoption had no significant impact on its consolidated financial statements. |
Basis of measurement | Basis of measurement These consolidated financial statements have been prepared under the historical cost convention, except for the revaluation of derivative financial instruments and short-term investments. |
Consolidation | Consolidation These consolidated financial statements include the accounts of the company and its domestic and foreign subsidiaries. Intercompany accounts and transactions have been eliminated. |
Revenue recognition | Revenue recognition The company exercises judgment and uses estimates in connection with determining the amounts of product and service revenues to be recognized in each accounting period. The company accounts for revenue once a legally enforceable contract with a customer has been approved by the parties and the related promises to transfer products or services have been identified. A contract is defined by the company as an arrangement with commercial substance identifying payment terms, and each party’s rights and obligations regarding the products or services to be transferred and for which collection is probable. The company’s contracts usually take the form of purchase orders. Customer contracts may include promises to transfer multiple products and services. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one single performance obligation may require significant judgment. The company derives revenues from goods and services. Sales of goods, consist of standalone hardware products, hardware products with embedded software that are essential to providing customers the intended functionality of the solutions, standalone software licenses, as well as hardware products bundled with a software license. Sales of services mainly consist of professional services, consulting, stand-ready software-as-a-service (SaaS), maintenance contracts, extended warranties, installation, integration, and training. The company’s performance obligations consist of a variety of products and services. Revenue is recognized when control of the products or services are transferred to the customers in an amount that reflects the consideration the company expects to be entitled to in exchange for products and services. Revenue from software and hardware support is recognized ratably over the support period. Support services generally include rights to unspecified upgrades (when and if available), telephone and internet-based support, updates, bug fixes and hardware repair and replacement. SaaS services are recognized ratably over the contract term. If the contract contains a single performance obligation, the entire transaction price is attributed to that performance obligation. Some of the company’s contracts include multiple distinct performance obligations with a combination of products and services, maintenance and support, professional services and/or training. The company allocates the transaction price among the performance obligations in an amount that depicts the relative standalone selling prices (SSP) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. The company assesses SSP based on historical pricing for products and services, whether sold alone or as part of a multiple element transaction. The company reviews sales of the product and services elements on a regular basis and updates, when appropriate, its SSP for such elements to ensure that it reflects recent pricing experience. Payments for products and services are typically due up front with payment terms of 30 to 90 days. However, the company has contracts pursuant to which payments are due over a certain period generally not exceeding one year based on agreed-upon payment terms either prior to or following the transfer of control for the contracted performance obligations. Payments on multi-year maintenance and consulting services are typically due in annual, quarterly or monthly installments over the contract term. The company did not have any material variable consideration such as obligations for returns, refunds or warranties as at August 31, 2019 and 2020. |
Presentation currency | Presentation currency The functional currency of the company is the Canadian dollar. The company has adopted the US dollar as its presentation currency as it is the most commonly used reporting currency in its industry. The consolidated financial statements are translated into the presentation currency as follows: assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet; revenues and expenses are translated at the monthly average exchange rate. The foreign currency translation adjustment arising from such translation is included in accumulated other comprehensive loss in shareholders’ equity. |
Foreign currency translation | Foreign currency translation (a) Foreign currency transactions Transactions denominated in currencies other than the functional currency are translated into the relevant functional currency as follows: monetary assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet, and revenues and expenses are translated at the exchange rate in effect on the date of the transaction. Non-monetary assets and liabilities measured at historical cost and denominated in a foreign currency are translated using the exchange rate at the date of the transaction, whereas non-monetary items that are measured at fair value and denominated in a foreign currency are translated using the exchange rates at the date when the fair value was determined. Foreign exchange gains and losses arising from such translation are included in the consolidated statements of earnings. (b) Foreign operations Each foreign operation determines its own functional currency, and items included in the financial statements of each foreign operation are measured using that functional currency. The financial statements of each foreign operation that has a functional currency different from that of the company are translated into Canadian dollars as follows: assets and liabilities are translated at the exchange rate in effect on the date of the consolidated balance sheet; revenues and expenses are translated at the monthly average exchange rate. The foreign currency translation adjustment arising from such translation is included in accumulated other comprehensive income in shareholders’ equity. |
Financial instruments | Financial instruments The classification of financial instruments depends on the intended purpose when the financial instruments were acquired or issued, as well as on their characteristics and designation by the company. Financial assets at amortized cost Financial assets are measured at amortized cost if they are held within a business model whose objective is to hold assets to collect contractual cash flows, and their contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Otherwise, they are classified at fair value through profit or loss through other comprehensive income. Financial liabilities at amortized cost Financial liabilities are measured at amortized cost. Financial assets at fair value through other comprehensive income Financial assets at fair value through other comprehensive income are initially recognized at fair value plus transaction costs and are subsequently measured at fair value. After their initial recognition, any changes in their fair value are reflected in the consolidated statements of comprehensive loss. |
Derivative financial instruments and hedging activities | Derivative financial instruments and hedging activities Forward exchange contracts are utilized by the company to manage its foreign currency exposure. Forward exchange contracts are entered into by the company to hedge anticipated US-dollar-denominated sales and the related accounts receivable as well as Indian-rupee-denominated operating expenses and the related accounts payable. The company’s policy is not to utilize those derivative financial instruments for trading or speculative purposes. The company’s forward exchange contracts, which are designated as cash flow hedging instruments, qualify for hedge accounting. Forward exchange contracts are classified as financial instruments at fair value through other comprehensive income. They are initially recorded at fair value and subsequently measured at fair value. The fair value of forward exchange contracts is determined using observable prices and forward exchange rates at the consolidated balance sheet date, with the resulting value discounted back to present value. After initial recognition, the effective portion of changes in their fair value is reflected in other comprehensive income. Any ineffective portion is recognized immediately in the consolidated statements of earnings. Upon recognition of related hedged sales and operating expenses, accumulated changes in fair value of forward exchange contracts are respectively reclassified in sales and net research and development expenses in the consolidated statements of earnings. At the inception of a hedge relationship, the company formally designates and documents the hedge relationship to which the company wishes to apply hedge accounting, the risk management objectives, the hedging instrument, the hedged item and the method used to test effectiveness. The company assesses effectiveness of the hedge relationship at inception and on an ongoing basis using the dollar-offset method. |
Fair value hierarchy | Fair value hierarchy The company classifies its derivative and non-derivative financial assets and financial liabilities measured at fair value using the fair value hierarchy as follows: Level 1: Quoted prices (unadjusted) in an active market for identical assets or liabilities; Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset and liability, either directly or indirectly; and Level 3: Unobservable inputs for the asset or liability. The company’s short-term investments and forward exchange contracts are measured at fair value at each consolidated balance sheet date. The company’s short-term investments are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. The company’s forward exchange contracts are classified within Level 2 of the fair value hierarchy because they are valued using observable prices and forward foreign exchange rates at the consolidated balance sheet dates. |
Short-term investments | Short-term investments All investments with original terms to maturity of three months or less and that are not required for the purposes of meeting short-term cash requirements are classified as short-term investments. |
Inventories | Inventories Inventories are valued on an average cost basis, at the lower of cost and net realizable value. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale. The cost of work in progress and finished goods includes material, labor and an allocation of manufacturing overhead. |
Property, plant and equipment and depreciation | Property, plant and equipment and depreciation Property, plant and equipment are recorded at cost, net of accumulated depreciation and accumulated impairment losses. Such cost is reduced by related research and development tax credits. Depreciation is provided on a straight-line basis over the estimated useful lives of the asset as follows: Term Land improvements 15 years Buildings 20 to 60 years Equipment 3 to 15 years Leasehold improvements The lesser of useful life and remaining lease term The assets’ residual values and useful lives are reviewed at each financial year-end and are adjusted prospectively, if appropriate. |
Intangible assets, goodwill and amortization | Intangible assets, goodwill and amortization Intangible assets Intangible assets with finite useful lives primarily include the cost of core technology, customer relationships and software. The cost of intangible assets acquired in a business combination is the fair value of the assets at the date of acquisition. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses. Amortization is provided on a straight-line basis over the estimated useful lives of two to eight years for core technologies, three months to five years for customer relationships, one year for brand name, and two and eight years for software. None of the company’s intangible assets were developed internally. The amortization method and the useful lives of intangible assets are reviewed at each financial year-end and are adjusted prospectively, if appropriate. Goodwill Goodwill represents the excess of the purchase price of acquired businesses over the estimated fair value of net identifiable assets acquired and is allocated to each cash-generating unit (CGU) or group of CGUs that are expected to benefit from the related business combination. A group of CGUs represents the lowest level within the company at which the goodwill is monitored for internal management purposes, which is not higher than an operating segment. Goodwill is not amortized but must be tested for impairment on an annual basis or more frequently if events or circumstances indicate that it might be impaired. Research and development All costs related to research are expensed as incurred, net of related tax credits and grants. Development costs are expensed as incurred, net of related tax credits and grants, unless they meet the recognition criteria of IAS 38, Intangible Assets, in which case they are capitalized, net of related tax credits and grants and amortized on a straight-line basis over the estimated benefit period. Research and development expenses mainly comprise salaries and related expenses, material costs as well as fees paid to third-party consultants. As at August 31, 2019 and 2020, the company had not capitalized any development costs. The company elected to account for non-refundable research and development tax credits under IAS 20, Accounting for Governmental Grants and Disclosures of Governmental Assistance, and, as such, these tax credits are presented against gross research and development expenses in the consolidated statements of earnings. Non-refundable research and development tax credits are included in earnings or deducted from the related assets, provided there is reasonable assurance that the company has complied and will comply with the conditions related to the tax credits and that the tax credits will be received. |
Impairment of non-financial assets | Impairment of non-financial assets The company assesses at each reporting date whether there is an indication that the carrying value of property, plant and equipment and finite-life intangible assets may not be recoverable. Non-financial assets that are not amortized (such as goodwill) are subject to an annual impairment test. If any indication exists, or when annual impairment testing is required, the company estimates the asset or asset group’s recoverable amount. For the purpose of measuring recoverable amounts, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs). The recoverable amount is the higher of an asset or CGU’s fair value less costs of disposal and its value in use. Where the carrying value of an asset or CGU exceeds its recoverable amount, the asset or the CGU is considered impaired and is written down to its recoverable amount. The company performs its annual goodwill impairment test in the fourth quarter of each fiscal year. For property, plant and equipment and finite-life intangible assets, the reversal of impairment is limited so that the carrying value of the asset does not exceed its recoverable amount, nor exceed the carrying value that would have been determined, net of depreciation or amortization, had no impairment loss been recognized for the asset in prior periods. Impairment losses on goodwill are not reversed. |
Government grants | Government grants Grants related to operating expenses are included in earnings when the related expenses are incurred. Grants related to capital expenditures are deducted from the related assets. Grants are included in the consolidated statements of earnings or deducted from the related assets, provided there is reasonable assurance that the company has complied and will comply with all the conditions related to the grants and that the grants will be received. |
Leases | Leases The company determines if an arrangement is a lease or contains a lease at inception. Operating lease liabilities are recognized based on the present value of the remaining lease payments, discounted using the discount rate for the lease at the commencement date, and are subsequently adjusted for interest and lease payments. When the rate implicit in the lease is not readily determinable, the company uses an incremental borrowing rate based on information available at the commencement date to determine the present value of future lease payments. The lease term is the non-cancelable period of the lease and includes options to extend or terminate the lease when it is reasonably certain that an option will be exercised. Lease ROU assets are recognized at commencement based on the amount of the initial measurement of the lease liabilities. Lease ROU assets also include any lease payments made prior to lease commencement and exclude lease incentives. Lease ROU assets are depreciated on a straight-line basis over the lease term. The company’s lease terms may include options to extend or terminate the lease where it is reasonably certain that the company will exercise those options. The company considers several economic factors when making this determination including, but not limited to, the significance of leasehold improvements incurred in the office space, the difficulty in replacing the asset, underlying contractual obligations, and specific characteristics unique to a lease. |
Warranty | Warranty The company offers its customers basic warranties of one to three years, depending on the specific products and terms of the purchase agreement. The company’s typical warranties require it to repair or replace defective products during the warranty period at no cost to the customer. Costs related to basic warranties are accrued at the time of shipment, based upon estimates of expected rework and warranty costs to be incurred. Costs associated with separately priced extended warranties are expensed as incurred. |
Income taxes | Income taxes Income taxes comprise current and deferred income taxes. Current income taxes Current income tax assets and liabilities for the current and prior years are measured at the amount expected to be recovered or paid to the taxation authorities. Income tax rates used to calculate the amount are those that are enacted or substantively enacted at the consolidated balance sheet dates in the tax jurisdictions where the company generates taxable income/loss. Deferred income taxes The company provides for deferred income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on deductible or taxable temporary differences between the consolidated financial statement values and tax values of assets and liabilities as well as the carry-forward of unused tax losses and deductions, using enacted or substantively enacted income tax rates at the consolidated balance sheet dates, that are expected to be in effect for the years in which the assets are expected to be recovered or the liabilities to be settled. Deferred income tax assets are recognized only to the extent that it is probable that future taxable income will be available against which the deductible temporary differences as well as unused tax losses and deductions can be utilized. Deferred tax liabilities are recognized for all taxable temporary differences and for taxable temporary differences arising on investments in subsidiaries, except where the reversal of these temporary differences can be controlled, and it is probable that the differences will not reverse in the foreseeable future. Deferred income tax assets and liabilities are presented as non-current in the consolidated balance sheets. |
Earnings per share | Earnings per share Basic earnings per share are calculated by dividing net earnings attributable to common equity holders of the company by the weighted average number of common shares outstanding during the year. Diluted earnings per share are calculated by dividing net earnings attributable to common equity holders of the company by the weighted average number of common shares outstanding during the year, plus the effect of dilutive potential common shares outstanding during the year. This method requires that diluted earnings per share be calculated (using the treasury stock method) as if all dilutive potential common shares had been exercised at the latest at the beginning of the year or on the date of issuance, as the case may be, and that the funds obtained thereby (plus an amount equivalent to the unamortized portion of related stock-based compensation costs) be used to purchase common shares of the company at the average market price of the common shares during the year. |
Stock-based compensation | Stock-based compensation Equity-settled awards The company’s stock options, restricted share units and deferred share units are equity-settled awards. The company accounts for stock-based compensation costs on equity-settled awards using the Black-Scholes option valuation model. The fair value of equity-settled awards is measured at the date of grant. Stock-based compensation costs are amortized to expense over the vesting periods together with a corresponding change in contributed surplus in shareholders’ equity. For equity-settled awards with graded vesting, each tranche is considered a separate grant with a different vesting date and fair value, and each tranche is accounted for separately. Cash-settled awards The company’s stock appreciation rights are cash-settled awards. The company accounts for stock-based compensation costs on cash-settled awards using the Black-Scholes option valuation model. The fair value of the cash-settled awards is remeasured at the end of each reporting period, with any changes in the fair value recognized in the consolidated statements of earnings. |
Operating segments | Operating segments Operating segments are defined as components of an entity engaged in business activities from which it may earn revenues and incur expenses, and whose operating results are regularly reviewed by the Chief Operating Decision maker (CODM) to make decisions about resources to be allocated to segments and assess their performance and for which discrete information is available. The function of the CODM is performed by the Chief Executive Officer who reviews consolidated results for the purposes of allocating resources and evaluating performance. Accordingly, the company determines that it has one operating segment as of, and for the years ended August 31, 2018, 2019 and 2020. Entity-wide disclosures are presented in note 24. |
Critical judgments, estimates and assumptions | Critical judgments, estimates and assumptions Coronavirus pandemic In December 2019, a novel strain of coronavirus was identified in China and resulted in preventive measures imposed by the Chinese public health authorities including an extended shutdown of businesses, restrictions on various forms of public transportation and lockdown periods for individuals—all of which affected the company’s factory and supply chain during a certain period. In March 2020, this coronavirus epidemic was declared a pandemic by and most countries have been imposing ongoing constraints and preventive measures that have affected and are still affecting the global economy. Significant fluctuations in the stock market have occurred for various reasons linked to the coronavirus pandemic. Although constraints and preventive measures are progressively being relaxed in many countries, the breadth and duration of this pandemic are unknown and raise uncertainties that may impact the measurement of assets and liabilities in future periods. This pandemic had a negative impact on the company’s sales and operating results in fiscal 2020, and the company believes it might continue to negatively impact its sales and operating results to a certain extent over an undetermined period, depending on the evolution of the pandemic and its treatment, if any. In addition, over the last months, the company’s stock price significantly fluctuated as a result of the pandemic. As a result of these impacts, during the third quarter of fiscal 2020, the company concluded that they represented a triggering event and performed goodwill impairment testing for all CGUs. The company also performed its annual goodwill impairment test as at August 31, 2020 (note 10). As at May 31 and August 31, 2020, the recoverable amount for all CGUs exceeded their carrying value. The preparation of financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses as well as the disclosures of contingent assets and liabilities at the date of the financial statements. On an ongoing basis, the company evaluates these estimates and assumptions, including those related to the fair value of assets and liabilities acquired in business combinations, the fair value of financial instruments, the allowance for doubtful accounts receivable, the amount of tax credits recoverable, the provision for excess and obsolete inventories, the estimated useful lives of capital assets, the valuation of long-lived assets, the impairment of goodwill, the recoverable amount of deferred income tax assets, the amount of certain accrued liabilities, provisions and deferred revenue as well as stock-based compensation costs. The company bases its estimates and assumptions on historical experience and on other factors that it believes to be reasonable under the circumstances. Actual results could differ from those judgments, estimates and assumptions. |
Critical judgments in applying accounting policies | Critical judgments in applying accounting policies (a) Determination of functional currency The company operates in multiple countries and generates revenue and incurs expenses in several currencies, namely the Canadian dollar, the US dollar, the euro, the British pound, the Indian rupee and the CNY (Chinese currency). The determination of the functional currency of the company and its subsidiaries may require significant judgment. In determining the functional currency of the company and its subsidiaries, management takes into account primary, secondary and tertiary indicators. When indicators are mixed, and the functional currency is not obvious, management uses its judgment to determine the functional currency. (b) Determination of cash-generating units and allocation of goodwill For the purpose of impairment testing, goodwill must be allocated to each CGU or group of CGUs that is expected to benefit from the synergies of the business combination. Initial allocation and possible reallocation of goodwill to a CGU or a group of CGUs requires judgment. |
Critical estimates and assumptions | Critical estimates and assumptions (a) Inventories The company states its inventories at the lower of cost, determined on an average cost basis, and net realizable value, and provides reserves for excess and obsolete inventories. The company determines its reserves for excess and obsolete inventories based on the quantities on hand at the reporting dates compared to foreseeable needs, taking into account changes in demand, technology or market. (b) Income taxes The company is subject to income tax laws and regulations in several jurisdictions. Under these laws and regulations, uncertainties exist with respect to the interpretation of complex tax laws and regulations and the amount and timing of future taxable income. The company maintains provisions for uncertain tax positions that it believes appropriately reflect its risk based on its interpretation of laws and regulations. In addition, management has made reasonable estimates and assumptions to determine the amount of deferred tax assets that can be recognized in the consolidated financial statements, based upon the likely timing and level of anticipated future taxable income together with tax-planning strategies. The ultimate realization of the company’s deferred income tax assets is dependent upon the generation of sufficient future taxable income during the periods in which those assets are expected to be realized. (c) Tax credits recoverable Tax credits are recorded if there is reasonable assurance that the company has complied and will comply with all the conditions related to the tax credits and that the tax credits will be received. The ultimate recovery of the company’s non-refundable tax credits is dependent upon the generation of sufficient future taxable income during the tax credits carry-forward periods. Management has made reasonable estimates and assumptions to determine the amount of non-refundable tax credits that can be recognized in the consolidated financial statements, based upon the likely timing and level of anticipated future taxable income together with tax-planning strategies (note 22). (d) Impairment of non-financial assets Impairment exists when the carrying value of an asset or group of assets (CGU) exceeds its recoverable amount, which is the higher of its fair value less costs of disposal and its value in use. The fair value less costs of disposal calculation for the company’s CGUs might be based on several different approaches that relies on unobservable inputs, such as market, cost or income approaches. The company applies judgment in making adjustments to the unobservable inputs for factors such as size, risk profile or profitability. Also, the income approach involves significant judgment with respect to estimating cash flows (based on market participant assumptions) and the appropriate discount rate. The company also considers the company’s value derived from its market capitalization, adjusting for a control premium considered appropriate based on other comparable companies with significant controlling interests. (e) Purchase price allocation in business combinations The fair value of the total consideration transferred in business combinations (purchase price) must be allocated based on estimated fair value of acquired net assets at the date of acquisition. Allocating the purchase price requires management to make estimates and judgments to determine assets acquired and liabilities assumed, useful lives of certain long-lived assets and the respective fair value of assets acquired, and liabilities assumed; this may require the use of unobservable inputs, including management’s expectations of future revenue growth, operating costs and profit margins as well as discount rates. (f) Identification of performance obligations Customer contracts may include promises to transfer multiple products and services to a customer. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one single performance obligation may require significant judgment. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Basis of Presentation [Abstract] | |
Estimated useful life | Depreciation is provided on a straight-line basis over the estimated useful lives of the asset as follows: Term Land improvements 15 years Buildings 20 to 60 years Equipment 3 to 15 years Leasehold improvements The lesser of useful life and remaining lease term |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Restructuring Charges [Abstract] | |
Restructuring charges | The following tables summarize changes in restructuring accrual during the years ended August 31, 2019 and 2020: Years ended August 31, 2020 2019 Balance – Beginning of year $ 1,133 $ 3,167 Addition 2,886 3,305 Payments (393 ) (5,339 ) Balance – End of year (note 12) $ 3,626 $ 1,133 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Financial Instruments [Abstract] | |
Financial Instruments by category | The following tables summarize financial instruments by category: As at August 31, 2020 Amortized cost Fair value through other comprehensive income Total Financial assets Cash $ 32,818 $ – $ 32,818 Short-term investments $ – $ 919 $ 919 Accounts receivable $ 59,328 $ – $ 59,328 Forward exchange contracts $ – $ 1,587 $ 1,587 Financial liabilities Bank loan $ 32,737 $ – $ 32,737 Accounts payable and accrued liabilities $ 41,238 $ – $ 41,238 Other liabilities $ 4,032 $ – $ 4,032 Long-term debt $ 4,220 $ – $ 4,220 Forward exchange contracts $ – $ 110 $ 110 As at August 31, 2019 Amortized cost Fair value through other comprehensive income Total Financial assets Cash $ 16,518 $ – $ 16,518 Short-term investments $ – $ 2,918 $ 2,918 Accounts receivable $ 54,834 $ – $ 54,834 Forward exchange contracts $ – $ 79 $ 79 Financial liabilities Bank loan $ 5,000 $ – $ 5,000 Accounts payable and accrued liabilities $ 49,945 $ – $ 49,945 Other liabilities $ 1,606 $ – $ 1,606 Long-term debt $ 5,742 $ – $ 5,742 Forward exchange contracts $ – $ 1,057 $ 1,057 |
Fair value of derivative and non-derivative financial assets and liabilities measured at fair value by level of hierarchy | The fair value of derivative and non-derivative financial assets and financial liabilities measured at fair value by level of hierarchy is as follows: As at August 31, 2020 As at August 31, 2019 Level 1 Level 2 Level 1 Level 2 Financial assets Short-term investments $ 919 $ – $ 2,918 $ – Forward exchange contracts $ – $ 1,587 $ – $ 79 Financial liabilities Forward exchange contracts $ – $ 110 $ – $ 1,057 |
Summary of currency risk contracts held at various forward rates | As at August 31, 2019 and 2020, the company held contracts to sell US dollars for Canadian dollars and Indian rupees at various forward rates, which are summarized as follows: US dollars – Canadian dollars Expiry dates Contractual amounts Weighted average contractual forward rates As at August 31, 2019 September 2019 to August 2020 $ 35,500 1.3013 September 2020 to August 2021 19,900 1.3107 September 2021 to July 2022 6,000 1.3216 Total $ 61,400 1.3063 As at August 31, 2020 September 2020 to August 2021 $ 36,100 1.3283 September 2021 to August 2022 18,800 1.3492 September 2022 to February 2023 3,600 1.3324 Total $ 58,500 1.3353 US dollars – Indian rupees Expiry dates Contractual amount Weighted average contractual forward rate As at August 31, 2019 September 2019 to August 2020 $ 3,500 71.48 As at August 31, 2020 September 2020 to February 2021 $ 1,500 77.56 |
Recorded sales foreign exchange gains (losses) on forward exchange contracts | For the years ended August 31, 2018, 2019 and 2020, the company recorded within its sales the following foreign exchange gains (losses) on forward exchange contracts: Years ended August 31, 2020 2019 2018 Gains (losses) on forward exchange contracts $ (1,028 ) $ (591 ) $ 875 |
Significant derivative and non-derivative financial assets and liabilities subject to currency risk | The following table summarizes significant derivative and non-derivative financial assets and financial liabilities that are subject to currency risk as at August 31, 2019 and 2020 and for which such risk is charged to earnings: As at August 31, 2020 2019 Carrying/nominal amount (in thousands of US dollars) Carrying/nominal amount (in thousands of euros) Carrying/nominal amount (in thousands of US dollars) Carrying/nominal amount (in thousands of euros) Financial assets Cash $ 10,147 € 8,152 $ 5,531 € 3,129 Accounts receivable 33,681 8,807 30,451 6,389 43,828 16,959 35,982 9,518 Financial liabilities Bank loan 22,000 – 5,000 – Accounts payable and accrued liabilities 8,683 1,693 12,563 2,218 Forward exchange contracts (nominal value) 6,100 – 5,800 – 36,783 1,693 23,363 2,218 Net exposure $ 7,045 € 15,266 $ 12,619 € 7,300 |
Schedule of short-term investments | Short-term investments consist of the following: As at August 31, 2020 2019 Term deposits denominated in Indian rupees, bearing interest at annual rates of 5.1% to 7.0% in 2019 and 3.0% to 6.3% in 2020, maturing on different dates between September 2019 and May 2020 in 2019 and December 2020 and February 2023 in 2020 $ 728 $ 2,548 Other 191 370 $ 919 $ 2,918 |
Age of trade accounts receivable | The following table summarizes the age of trade accounts receivable: As at August 31, 2020 2019 Current $ 40,595 $ 39,054 Past due, 0 to 30 days 7,622 3,529 Past due, 31 to 60 days 1,677 2,006 Past due, more than 60 days 6,397 6,928 $ 56,291 $ 51,517 |
Changes in allowance for doubtful accounts | Changes in the allowance for doubtful accounts are as follows: Years ended August 31, 2020 2019 Balance – Beginning of year $ 1,535 $ 772 IFRS 9 adoption initial adjustment – 303 Addition charged to net loss 1,173 864 Write-off of uncollectible accounts and reversal (953 ) (404 ) Balance – End of year $ 1,755 $ 1,535 |
Summary of contractual maturity of the company's derivative and non-derivative financial liabilities | The following tables summarize the contractual maturity of the company’s derivative and non-derivative financial liabilities: As at August 31, 2020 No later than one year Later than 1 year and no later than 5 years Bank loan $ 32,737 $ – Accounts payable and accrued liabilities 41,238 – Forward exchange contracts Outflow 37,600 22,400 Inflow (38,364 ) (23,128 ) Long-term debt 2,076 2,144 Other liabilities 4,032 – Total $ 79,319 $ 1,416 As at August 31, 2019 No later than one year Later than 1 year and no later than 5 years Later than 5 years Bank loan $ 5,000 $ – $ – Accounts payable and accrued liabilities 49,945 – – Forward exchange contracts Outflow 39,000 25,900 – Inflow (38,252 ) (25,585 ) – Long-term debt 2,449 3,237 56 Other liabilities 1,606 – – Total $ 59,748 $ 3,552 $ 56 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Inventories [Abstract] | |
Summary of inventories | As at August 31, 2020 2019 Raw materials $ 22,487 $ 24,115 Work in progress 3,846 1,009 Finished goods 12,532 12,893 $ 38,865 $ 38,017 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Summary of property, plant and equipment | Land and land improvements Buildings Equipment Leasehold improvements Total Cost as at September 1, 2018 $ 4,359 $ 32,346 $ 39,088 $ 3,048 $ 78,841 Additions – 1,116 3,700 164 4,980 Disposals (192 ) (3,378 ) (4,623 ) (164 ) (8,357 ) Foreign currency translation adjustment (76 ) (592 ) (1,329 ) (153 ) (2,150 ) Cost as at August 31, 2019 4,091 29,492 36,836 2,895 73,314 Additions – 933 3,949 137 5,019 Disposals – (31 ) (1,120 ) (10 ) (1,161 ) Foreign currency translation adjustment 79 591 1,080 126 1,876 Cost as at August 31, 2020 $ 4,170 $ 30,985 $ 40,745 $ 3,148 $ 79,048 Accumulated depreciation as at September 1, 2018 $ 1,290 $ 6,661 $ 25,163 $ 1,417 $ 34,531 Depreciation for the year 47 667 4,391 364 5,469 Disposals – (1,452 ) (3,673 ) (114 ) (5,239 ) Foreign currency translation adjustment (53 ) (120 ) (602 ) (36 ) (811 ) Accumulated depreciation as at August 31, 2019 1,284 5,756 25,279 1,631 33,950 Depreciation for the year 46 686 4,449 382 5,563 Disposals – (31 ) (1,120 ) (10 ) (1,161 ) Foreign currency translation adjustment 26 147 767 34 974 Accumulated depreciation as at August 31, 2020 $ 1,356 $ 6,558 $ 29,375 $ 2,037 $ 39,326 Net carrying value as at: August 31, 2019 $ 2,807 $ 23,736 $ 11,557 $ 1,264 $ 39,364 August 31, 2020 $ 2,814 $ 24,427 $ 11,370 $ 1,111 $ 39,722 |
Lease Right-of-Use Assets (Tabl
Lease Right-of-Use Assets (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Lease Right-of-Use Assets [Abstract] | |
Lease Right-of-Use Assets | The following table summarizes the change in cost and accumulated amortization of lease ROU assets for these premises: Cost as at September 1, 2019 $ – Adoption of IFRS 16 (note 2) 11,321 Additions 2,103 Foreign currency translation adjustment 555 Cost as at August 31, 2020 $ 13,979 Accumulated depreciation as at September 1, 2019 $ – Depreciation for the year (note 20) 3,349 Foreign currency translation adjustment (128 ) Accumulated depreciation as at August 31, 2020 $ 3,221 Net carrying value as at August 31, 2020 $ 10,758 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Intangible Assets and Goodwill [Abstract] | |
Summary of intangible assets | Intangible assets Core technology Customer relationships In-process research and development Brand name Software Total Cost as at September 1, 2018 $ 28,058 $ 10,291 $ 292 $ 796 $ 12,660 $ 52,097 Additions 363 – – – 1,719 2,082 Disposal (27 ) – (293 ) – (222 ) (542 ) Foreign currency translation adjustment (1,955 ) (618 ) 1 (46 ) (240 ) (2,858 ) Cost as at August 31, 2019 26,439 9,673 – 750 13,917 50,779 Additions 427 – – – 1,398 1,825 Disposal (181 ) – – (812 ) (2,222 ) (3,215 ) Foreign currency translation adjustment 1,939 561 – 62 461 3,023 Cost as at August 31, 2020 $ 28,624 $ 10,234 $ – $ – $ 13,554 $ 52,412 Accumulated amortization as at September 1, 2018 $ 9,610 $ 3,933 $ – $ 512 $ 8,176 $ 22,231 Amortization for the year 4,926 2,372 – 284 1,430 9,012 Disposal (19 ) – – – (219 ) (238 ) Foreign currency translation adjustment (1,080 ) (424 ) – (46 ) (330 ) (1,880 ) Accumulated amortization as at August 31, 2019 13,437 5,881 – 750 9,057 29,125 Amortization for the year 3,946 1,259 – – 1,262 6,467 Disposal (111 ) – – (812 ) (2,069 ) (2,992 ) Foreign currency translation adjustment 1,230 600 – 62 304 2,196 Accumulated amortization as at August 31, 2020 $ 18,502 $ 7,740 $ – $ – $ 8,554 $ 34,796 Net carrying value as at: August 31, 2019 $ 13,002 $ 3,792 $ – $ – $ 4,860 $ 21,654 August 31, 2020 $ 10,122 $ 2,494 $ – $ – $ 5,000 $ 17,616 Remaining amortization period as at August 31, 2020 3 years 1 year – – 3 years |
Reconciliation of changes in goodwill | Goodwill Years ended August 31, 2020 2019 Balance – Beginning of year $ 38,648 $ 39,892 Foreign currency translation adjustment 1,642 (1,244 ) Balance – End of year $ 40,290 $ 38,648 |
Information for cash generating units | Goodwill has been allocated to the lowest level within the company at which it is monitored by management to make business decisions, which are the following CGUs: As at August 31, 2020 2019 EXFO CGU $ 13,200 $ 12,949 EXFO Optics CGU 3,648 3,376 Service assurance, systems and services CGU 23,442 22,323 Total $ 40,290 $ 38,648 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Liabilities and Provisions (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Accounts Payable and Accrued Liabilities and Provisions [Abstract] | |
Accounts payable and accrued liabilities | Accounts payable and accrued liabilities As at August 31, 2020 2019 Trade $ 21,407 $ 27,996 Salaries and social benefits 17,998 19,716 Forward exchange contracts (note 6) 110 845 Other 1,833 2,233 $ 41,348 $ 50,790 |
Provisions | Provisions As at August 31, 2020 2019 Warranty $ 380 $ 356 Restructuring charges (note 4) 3,626 1,133 Other 2,568 2,313 $ 6,574 $ 3,802 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Leases [Abstract] | |
Minimal rentals payable under operating leases | Minimal rentals payable under operating leases are as follows as at August 31, 2020: No later than 1 year $ 3,249 Later than 1 year and no later than 5 years 6,377 Later than 5 years 957 Total lease liabilities as at August 31, 2020 $ 10,583 |
Lease liabilities recognized in consolidated balance sheet | The difference between operating lease commitments disclosed applying IAS 17 as at August 31, 2019, discounted using the incremental borrowing rate of 2% at the date of the initial application of IFRS 16 as at September 1, 2019, and the lease liabilities recognized in the consolidated balance sheet as at that date is as follows: Discounted operating lease commitments under IAS 17 as at August 31, 2019 $ 8,915 Discounted impact of renewal options that are reasonably certain to be exercised 1,928 Lease liabilities as at September 1, 2019 under IFRS 16 $ 10,843 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Long-Term Debt [Abstract] | |
Long-term debt | As at August 31, 2020 2019 Unsecured, non-interest-bearing loans, denominated in euros, repayable in quarterly instalments, maturing in March 2024 and March 2025 $ 896 $ 866 Unsecured loans, denominated in euros, repayable in monthly, quarterly or bi‑annual instalments, bearing interest at annual rates of nil to 5.0%, maturing at different dates between March 2020 and September 2023 in 2019 and December 2020 and September 2023 in 2020 2,443 3,111 Loans, secured by the universality of the assets of a subsidiary, denominated in euros, repayable in monthly instalments, bearing interest at annual rates of 0.7% to 1.5%, maturing at different dates between April 2020 and August 2022 in 2019 and February 2021 and August 2022 in 2020 295 459 Loans, secured by the universality of the assets of a subsidiary, denominated in euros, repayable in monthly or quarterly instalments, bearing interest at annual rates of 1.1% to 2.9%, maturing at different dates between March 2020 and July 2022 in 2019 and December 2020 and July 2022 in 2020 586 1,306 4,220 5,742 Current portion of long-term debt 2,076 2,449 $ 2,144 $ 3,293 |
Principal repayments of long-term debt | Principal repayments of long-term debt due over the forthcoming years are as follows as at August 31, 2020: No later than one year $ 2,076 Later than one year and no later than five years 2,144 $ 4,220 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Commitments [Abstract] | |
Leases agreements for intellectual property | The company entered into license agreements for certain intellectual property, which expire at various dates through 2025. Minimum payments for these agreements are as follows as at August 31, 2020: No later than one year $ 1,779 Later than one year and no later than five years 621 $ 2,400 |
Share Capital (Tables)
Share Capital (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Share Capital [Abstract] | |
Summary of share capital activity | The following table summarizes the company’s share capital activity: Multiple Voting Shares Subordinate Voting Shares Number Amount Number Amount Total amount Balance as at September 1, 2017 31,643,000 $ 1 23,068,777 $ 90,410 $ 90,411 Redemption of restricted share units (note 18) – – 345,883 – – Redemption of deferred share units (note 18) – – 58,335 – – Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,526 1,526 Balance as at August 31, 2018 31,643,000 1 23,472,995 91,936 91,937 Redemption of restricted share units (note 18) – – 317,072 – – Redemption of share capital – – (86,392 ) (337 ) (337 ) Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,106 1,106 Balance as at August 31, 2019 31,643,000 1 23,703,675 92,705 92,706 Redemption of restricted share units (note 18) – – 411,619 – – Redemption of share capital – – (54,528 ) (212 ) (212 ) Reclassification of stock-based compensation costs to share capital upon exercise of stock awards – – – 1,530 1,530 Balance as at August 31, 2020 31,643,000 $ 1 24,060,766 $ 94,023 $ 94,024 a) On January 8, 2019, the company announced that its Board of Directors had approved a share repurchase program, by way of a normal course issuer bid on the open market of up to 6.3% of the issued and outstanding subordinate voting shares, representing 1,200,000 subordinate voting shares at the prevailing market price. The normal course issuer bid started on January 14, 2019 and ended on January 13, 2020. All shares repurchased under the bid were canceled. b) On January 7, 2020, the company announced that its Board of Directors had approved a share repurchase program, by way of a normal course issuer bid on the open market of up to 3.1% of the issued and outstanding subordinate voting shares, representing 600,000 subordinate voting shares at the prevailing market price. The normal course issuer bid started on January 14, 2020 and will end on January 13, 2021 or earlier if the company repurchases the maximum number of shares permitted. All shares repurchased under the bid will be canceled. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Accumulated Other Comprehensive Loss [Abstract] | |
Changes in accumulated other comprehensive loss | Changes in accumulated other comprehensive loss are as follows: Foreign currency translation adjustment Cash-flow hedge Accumulated other comprehensive loss Balance as at September 1, 2017 $ (40,874 ) $ 1,909 $ (38,965 ) Foreign currency translation adjustment (6,491 ) – (6,491 ) Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – (1,894 ) (1,894 ) Balance as at August 31, 2018 (47,365 ) 15 (47,350 ) Foreign currency translation adjustment (4,177 ) – (4,177 ) Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – 16 16 Balance as at August 31, 2019 (51,542 ) 31 (51,511 ) Foreign currency translation adjustment 5,994 – 5,994 Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes – 1,743 1,743 Balance as at August 31, 2020 $ (45,548 ) $ 1,774 $ (43,774 ) |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-based compensation costs recognized for employee services | The following table summarizes the stock-based compensation costs recognized for employee services received during the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Stock-based compensation costs arising from equity-settled awards $ 2,027 $ 1,849 $ 1,770 Stock-based compensation costs arising from cash-settled awards (6 ) (18 ) (22 ) $ 2,021 $ 1,831 $ 1,748 |
Restricted Stock Units [Member] | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of stock option activity | The following table summarizes RSU activity for the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Outstanding – Beginning of year 1,836,446 1,615,152 1,611,330 Granted 439,220 632,931 420,621 Redeemed (411,619 ) (317,072 ) (345,883 ) Forfeited (150,932 ) (94,565 ) (70,916 ) Outstanding – End of year 1,713,115 1,836,446 1,615,152 |
Performance Share Units [Member] | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of stock option activity | The following table summarizes PSU activity for the year ended August 31, 2020: Outstanding – Beginning of year – Granted 143,251 Outstanding – End of year 143,251 |
Deferred Share Unit Plan [Member] | |
Disclosure of terms and conditions of share-based payment arrangement [line items] | |
Summary of stock option activity | The following table summarizes DSU activity for the years ended August 31, 2018, 2019 and 2020: Years ended August 31, 2020 2019 2018 Outstanding – Beginning of year 251,507 181,689 174,279 Granted 79,819 69,818 65,745 Redeemed – – (58,335 ) Outstanding – End of year 331,326 251,507 181,689 |
Related Party Disclosures (Tabl
Related Party Disclosures (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Related Party Disclosures [Abstract] | |
Compensation of key management personnel | Compensation of key management personnel Years ended August 31, 2020 2019 2018 Salaries and short-term employee benefits $ 4,086 $ 4,029 $ 3,985 Stock-based compensation costs 1,391 1,175 1,047 $ 5,477 $ 5,204 $ 5,032 |
Statements of Earnings (Tables)
Statements of Earnings (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Statements of Earnings [Abstract] | |
Sales | Sales are as follows: Years ended August 31, 2020 2019 2018 Test and measurement $ 197,419 $ 204,693 $ 197,423 Service assurance, systems and services 69,192 82,788 71,248 Foreign exchange gains (losses) on forward exchange contracts (1,028 ) (591 ) 875 Total sales for the year $ 265,583 $ 286,890 $ 269,546 |
Net research and development expenses | Net research and development expenses comprise the following: Years ended August 31, 2020 2019 2018 Gross research and development expenses $ 54,564 $ 57,972 $ 65,243 Research and development tax credits and grants (9,077 ) (7,419 ) (8,089 ) Net research and development expenses for the year $ 45,487 $ 50,553 $ 57,154 |
Depreciation and amortization expenses by functional area | Depreciation and amortization expenses by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales Depreciation of property, plant and equipment $ 1,923 $ 1,862 $ 2,077 Depreciation of lease ROU assets 1,106 – – Amortization of intangible assets 5,092 7,186 9,212 8,121 9,048 11,289 Selling and administrative expenses Depreciation of property, plant and equipment 1,080 1,354 902 Depreciation of lease ROU assets 1,472 – – Amortization of intangible assets 698 1,043 592 3,250 2,397 1,494 Net research and development expenses Depreciation of property, plant and equipment 2,560 2,253 2,465 Depreciation of lease ROU assets 771 – – Amortization of intangible assets 677 783 523 4,008 3,036 2,988 $ 15,379 $ 14,481 $ 15,771 Depreciation of property, plant and equipment $ 5,563 $ 5,469 $ 5,444 Depreciation of lease ROU assets 3,349 – – Amortization of intangible assets 6,467 9,012 10,327 Total depreciation and amortization expenses for the year $ 15,379 $ 14,481 $ 15,771 |
Employee compensation | Employee compensation comprises the following: Years ended August 31, 2020 2019 2018 Salaries and benefits $ 142,277 $ 136,059 $ 134,453 Restructuring charges 2,808 3,305 2,072 Stock-based compensation costs 2,021 1,831 1,748 Grants (CEWS) (3,262 ) – – Total employee compensation for the year $ 143,844 $ 141,195 $ 138,273 Restructuring charges by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales $ 898 $ 304 $ 517 Selling and administrative expenses 1,882 495 673 Net research and development costs 106 2,506 3,219 Interest and other expense – – 150 2,886 3,305 4,559 Income taxes (533 ) (63 ) (1,150 ) Total restructuring charges for the year $ 2,353 $ 3,242 $ 3,409 Stock-based compensation costs by functional area are as follows: Years ended August 31, 2020 2019 2018 Cost of sales $ 129 $ 136 $ 143 Selling and administrative expenses 1,548 1,375 1,217 Net research and development expenses 344 320 388 Total stock-based compensation costs for the year $ 2,021 $ 1,831 $ 1,748 CEWS by functional area are as follows (note 3): Years ended August 31, 2020 2019 2018 Cost of sales $ (723 ) $ – $ – Selling and administrative expenses (1,082 ) – – Net research and development expenses (1,457 ) – – Total CEWS for the year $ (3,262 ) $ – $ – |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Income Taxes [Abstract] | |
Reconciliation of income tax provision (recovery) | The reconciliation of the income tax provision (recovery) calculated using the combined Canadian federal and provincial statutory income tax rate with the income tax provision in the consolidated financial statements is as follows: Years ended August 31, 2020 2019 2018 Income tax provision (recovery) at combined Canadian federal and provincial statutory tax rate ( 27 $ (950 ) $ 774 $ (1,775 ) Increase (decrease) due to: Foreign income/loss taxed at different rates 540 13 452 Non-deductible loss (non-taxable income) (457 ) 10 (69 ) Non-deductible expenses 697 594 1,285 Change in tax rates – – 167 Effect of the US tax reform (1) – – 1,528 Foreign exchange effect of translation of foreign subsidiaries in the functional currency 732 63 (16 ) Recognition of previously unrecognized deferred income tax assets (506 ) (2,383 ) (560 ) Utilization of previously unrecognized deferred income tax assets (13 ) (964 ) (627 ) Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses 5,369 5,761 6,100 Other 610 1,478 (807 ) Income tax provision for the year $ 6,022 $ 5,346 $ 5,678 (1) On December 22, 2017, the US tax reform (“Tax Cuts and Jobs Act”) was substantively enacted and reduces the maximum corporate income tax rate from 35% to 21%, effective January 1, 2018. Based on management’s estimate of deferred tax assets expected to be used in fiscal 2018 and beyond against taxable income in the United States, the company recorded a deferred income tax expense of $1,528,000 in the consolidated statement of earnings for the year ended August 31, 2018 to account for the effect of this substantively enacted tax rate. |
Income tax provision | Years ended August 31, 2020 2019 2018 The income tax provision consists of the following: Current Current income taxes $ 5,365 $ 7,449 $ 4,310 Deferred Deferred income taxes relating to the origination and reversal of temporary differences (4,193 ) (4,517 ) (3,545 ) Benefit arising from previously unrecognized tax losses and deductible temporary differences (506 ) (2,383 ) (560 ) Utilization of previously unrecognized deferred income tax assets (13 ) (964 ) (627 ) (4,712 ) (7,864 ) (4,732 ) Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses 5,369 5,761 6,100 657 (2,103 ) 1,368 Income tax provision for the year $ 6,022 $ 5,346 $ 5,678 |
Changes in deferred income tax assets and liabilities | The changes in deferred income tax assets and liabilities for the year ended August 31, 2019 are as follows: Balance as at September 1, 2018 Credited (charged) to the statement of earnings Credited (charged) to shareholders’ equity Foreign currency translation adjustment Balance as at August 31, 2019 Deferred income tax assets Long-lived assets $ 1,925 $ 2,695 $ – $ (52 ) $ 4,568 Provisions and accruals 3,963 446 67 15 4,491 Deferred revenue 2,716 490 – (36 ) 3,170 Research and development expenses 2,524 (149 ) – (45 ) 2,330 Losses carried forward 5,073 (2,751 ) – (176 ) 2,146 Deferred income tax liabilities Long-lived assets (6,461 ) 1,710 – 345 (4,406 ) Research and development tax credits (10,936 ) (338 ) – 198 (11,076 ) Total $ (1,196 ) $ 2,103 $ 67 $ 249 $ 1,223 Classified as follows: Deferred income tax assets $ 4,714 $ 4,821 Deferred income tax liabilities (5,910 ) (3,598 ) $ (1,196 ) $ 1,223 The changes in deferred income tax assets and liabilities for the year ended August 31, 2020 are as follows: Balance as at September 1, 2019 Credited (charged) to the statement of earnings Credited (charged) to shareholders’ equity Foreign currency translation adjustment Balance as at August 31, 2020 Deferred income tax assets Long-lived assets $ 4,568 $ (804 ) $ – $ 71 $ 3,835 Provisions and accruals 4,491 (387 ) (578 ) 75 3,601 Deferred revenue 3,170 104 – 50 3,324 Research and development expenses 2,330 (47 ) – 44 2,327 Losses carried forward 2,146 (616 ) – 7 1,537 Deferred income tax liabilities Long-lived assets (4,406 ) 1,003 – (154 ) (3,557 ) Research and development tax credits (11,076 ) 90 – (208 ) (11,194 ) Total $ 1,223 $ (657 ) $ (578 ) $ (115 ) $ (127 ) Classified as follows: Deferred income tax assets $ 4,821 $ 3,633 Deferred income tax liabilities (3,598 ) (3,760 ) $ 1,223 $ (127 ) |
Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses | Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses are as follows: As at August 31, 2020 2019 Temporary deductible differences $ 163 $ 241 Losses carried forward 46,289 39,721 $ 46,452 $ 39,962 |
Operating losses for which no deferred income tax assets recognized | As at August 31, 2020, the year of expiry of operating losses for which no deferred income tax assets were recognized in the consolidated balance sheet are as follows, presented by tax jurisdiction: Year of expiry Finland France Spain United States United Kingdom 2021 $ 6,865 $ – $ – $ 1,074 $ – 2022 11,902 – – 7,435 – 2023 7,711 – – 1,972 – 2024 5,953 – – 1,351 – 2025 7,421 – – 1,351 – 2026 254 – – 1,351 – 2027 1,542 – – 1,351 – 2028 – – – 2,447 – 2030 1,516 – – 2,713 – 2031 – – – 109 – 2033 – – – 4,681 – 2034 – – – 4,851 – 2035 – – – 2,616 – 2036 – – – 8,501 – 2037 – – – 9,660 – 2038 – – – 7,997 – Indefinite – 58,516 6,414 – 8,267 $ 43,164 $ 58,516 $ 6,414 $ 59,460 $ 8,267 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Earnings per Share [Abstract] | |
Earnings per Share | The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding: Years ended August 31, 2020 2019 2018 Basic weighted average number of shares outstanding (000’s) 55,604 55,325 54,998 Plus dilutive effect of (000’s): Restricted share units – – – Deferred share units – – – Performance share units – – – Diluted weighted average number of shares outstanding (000’s) 55,604 55,325 54,998 Stock awards excluded from the calculation of the diluted weighted average number of shares outstanding because their exercise price was greater than the average market price of the common shares, or their inclusion would be antidilutive (000’s) 2,012 1,701 1,799 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Aug. 31, 2020 | |
Segment Information [Abstract] | |
Information by geographic region | Sales to external customers by geographic region are detailed as follows: Years ended August 31, 2020 2019 2018 United States $ 99,595 $ 106,607 $ 100,225 Canada 16,508 15,913 18,425 Other 13,379 21,391 16,743 Americas 129,482 143,911 135,393 United Kingdom 16,170 16,438 17,508 Other 63,700 76,285 67,169 Europe, Middle East and Africa 79,870 92,723 84,677 China 35,727 27,620 20,724 Other 20,504 22,636 28,752 Asia-Pacific 56,231 50,256 49,476 $ 265,583 $ 286,890 $ 269,546 Sales were allocated to geographic regions based on the country of residence of the related customers. Long-lived assets by geographic region are detailed as follows: As at August 31, 2020 As at August 31, 2019 Property, plant and equipment Lease ROU assets Intangible assets Goodwill Property, plant and equipment Lease ROU assets Intangible assets Goodwill Canada $ 29,801 $ – $ 5,338 $ 17,827 $ 29,517 $ – $ 5,675 $ 17,487 Finland 487 153 455 8,713 331 – 446 8,547 France 2,027 3,526 9,971 6,055 1,896 – 12,788 5,600 United Kingdom 488 544 1,808 7,695 640 – 2,706 7,014 India 4,083 65 18 – 4,249 – 23 – China 2,785 4,211 24 – 2,667 – 16 – United States 6 1,857 – – 7 – – – Other 45 402 2 – 57 – – – $ 39,722 $ 10,758 $ 17,616 $ 40,290 $ 39,364 $ – $ 21,654 $ 38,648 |
Basis of Presentation (Details)
Basis of Presentation (Details) | 12 Months Ended | ||
Aug. 31, 2020USD ($)yrSegment | Aug. 31, 2019USD ($)Segment | Aug. 31, 2018Segment | |
Leases [Abstract] | |||
Right-of-use assets | $ 10,758,000 | $ 0 | |
Lease liabilities | 10,583,000 | 10,843,000 | |
Prepaid rent | $ 5,631,000 | $ 6,510,000 | |
Revenue recognition under IFRS 15 [Abstract] | |||
Maximum term for payments pursuant to contracts | 1 year | ||
Operating segments [Abstract] | |||
Number of operating segments | Segment | 1 | 1 | 1 |
Bottom of Range [Member] | |||
Revenue recognition under IFRS 15 [Abstract] | |||
Term of payments for products and services | 30 days | ||
Warranty [Abstract] | |||
Basic warranty period | yr | 1 | ||
Top of Range [Member] | |||
Revenue recognition under IFRS 15 [Abstract] | |||
Term of payments for products and services | 90 days | ||
Warranty [Abstract] | |||
Basic warranty period | yr | 3 | ||
IFRS 16 [Member] | |||
Leases [Abstract] | |||
Right-of-use assets | $ 11,321,000 | ||
Lease liabilities | 10,843,000 | ||
Prepaid rent | $ 478,000 | ||
Land Improvements [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | 15 years | ||
Buildings [Member] | Bottom of Range [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | 20 years | ||
Buildings [Member] | Top of Range [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | 60 years | ||
Equipment [Member] | Bottom of Range [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | 3 years | ||
Equipment [Member] | Top of Range [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | 15 years | ||
Leasehold Improvements [Member] | |||
Property, plant and equipment and depreciation [Abstract] | |||
Estimated useful lives | The lesser of useful life and remaining lease term | ||
Core Technology [Member] | Bottom of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 2 years | ||
Core Technology [Member] | Top of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 8 years | ||
Customer Relationships [Member] | Bottom of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 3 months | ||
Customer Relationships [Member] | Top of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 5 years | ||
Brand Names [member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 1 year | ||
Software [Member] | Bottom of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 2 years | ||
Software [Member] | Top of Range [Member] | |||
Intangible assets [Abstract] | |||
Estimated useful lives | 8 years |
Government Grants (Details)
Government Grants (Details) $ in Thousands | 12 Months Ended |
Aug. 31, 2020USD ($) | |
Canada Emergency Wage Subsidy [Member] | |
Government Grants [Abstract] | |
Amount of government grants | $ 3,262 |
Restructuring Charges (Details)
Restructuring Charges (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Aug. 31, 2018USD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2019USD ($)Building | Aug. 31, 2018USD ($) | |
Restructuring provision [Abstract] | ||||
Restructuring charges, net of tax | $ 2,353 | $ 3,242 | $ 3,409 | |
Net proceeds from sale of building | 230 | 3,318 | 0 | |
Pre-tax gain from sale of building | 340 | 1,732 | 0 | |
Deferred income tax recovery recognized | (657) | 2,103 | ||
Restructuring charges payable [Abstract] | ||||
Balance - Beginning of year | 1,133 | |||
Balance - End of year | 3,626 | 1,133 | ||
Fiscal 2018 Plan [Member] | ||||
Restructuring provision [Abstract] | ||||
Severance expenses | $ 2,072 | |||
Remaining non-cancelable operating lease | 1,137 | |||
Income tax credits writeoffs of research and development | 1,200 | |||
Impairment of long-lived assets | 150 | |||
Related income taxes | 1,150 | 63 | ||
Restructuring charges, net of tax | 3,409 | $ 3,242 | ||
Number of buildings sold | Building | 1 | |||
Net proceeds from sale of building | $ 3,318 | |||
Pre-tax gain from sale of building | 1,732 | |||
Deferred income tax recovery recognized | 2,383 | |||
Restructuring charges payable [Abstract] | ||||
Balance - Beginning of year | 1,133 | 3,167 | ||
Addition | 2,886 | 3,305 | ||
Payments | (393) | (5,339) | ||
Balance - End of year | $ 3,167 | $ 3,626 | $ 1,133 | $ 3,167 |
Capital Disclosures (Details)
Capital Disclosures (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Capital Disclosures [Abstract] | ||
Capital amount | $ 216,337 | $ 224,075 |
Financial Instruments, Financia
Financial Instruments, Financial Instruments by Category (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Bank Loan [Member] | ||
Financial liabilities [Abstract] | ||
Amortized cost | $ 32,737 | $ 5,000 |
Fair value through other comprehensive income | 0 | 0 |
Financial liabilities | 32,737 | 5,000 |
Accounts Payable and Accrued Liabilities [Member] | ||
Financial liabilities [Abstract] | ||
Amortized cost | 41,238 | 49,945 |
Fair value through other comprehensive income | 0 | 0 |
Financial liabilities | 41,238 | 49,945 |
Other Liabilities [Member] | ||
Financial liabilities [Abstract] | ||
Amortized cost | 4,032 | 1,606 |
Fair value through other comprehensive income | 0 | 0 |
Financial liabilities | 4,032 | 1,606 |
Long-term Debt [Member] | ||
Financial liabilities [Abstract] | ||
Amortized cost | 4,220 | 5,742 |
Fair value through other comprehensive income | 0 | 0 |
Financial liabilities | 4,220 | 5,742 |
Forward Exchange Contracts [Member] | ||
Financial liabilities [Abstract] | ||
Amortized cost | 0 | 0 |
Fair value through other comprehensive income | 110 | 1,057 |
Financial liabilities | 110 | 1,057 |
Cash [Member] | ||
Financial assets [Abstract] | ||
Amortized cost | 32,818 | 16,518 |
Fair value through other comprehensive income | 0 | 0 |
Financial assets | 32,818 | 16,518 |
Short-term Investments [Member] | ||
Financial assets [Abstract] | ||
Amortized cost | 0 | 0 |
Fair value through other comprehensive income | 919 | 2,918 |
Financial assets | 919 | 2,918 |
Accounts Receivables [Member] | ||
Financial assets [Abstract] | ||
Amortized cost | 59,328 | 54,834 |
Fair value through other comprehensive income | 0 | 0 |
Financial assets | 59,328 | 54,834 |
Forward Exchange Contracts [Member] | ||
Financial assets [Abstract] | ||
Amortized cost | 0 | 0 |
Fair value through other comprehensive income | 1,587 | 79 |
Financial assets | $ 1,587 | $ 79 |
Financial Instruments, Fair Val
Financial Instruments, Fair Value (Details) - Fair Value [Member] - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Forward Exchange Contracts [Member] | Level 1 [Member] | ||
Financial liabilities [Abstract] | ||
Financial liabilities | $ 0 | $ 0 |
Forward Exchange Contracts [Member] | Level 2 [Member] | ||
Financial liabilities [Abstract] | ||
Financial liabilities | 110 | 1,057 |
Long-term Debt [Member] | ||
Financial liabilities [Abstract] | ||
Financial liabilities | 4,115 | 5,644 |
Short-term Investments [Member] | Level 1 [Member] | ||
Financial assets [Abstract] | ||
Financial assets | 919 | 2,918 |
Short-term Investments [Member] | Level 2 [Member] | ||
Financial assets [Abstract] | ||
Financial assets | 0 | 0 |
Forward Exchange Contracts [Member] | Level 1 [Member] | ||
Financial assets [Abstract] | ||
Financial assets | 0 | 0 |
Forward Exchange Contracts [Member] | Level 2 [Member] | ||
Financial assets [Abstract] | ||
Financial assets | $ 1,587 | $ 79 |
Financial Instruments, Market R
Financial Instruments, Market Risk (Details) € in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2021USD ($) | Aug. 31, 2020USD ($)$ / sharesCAD ($) | Aug. 31, 2019USD ($)$ / sharesCAD ($) | Aug. 31, 2018USD ($) | Aug. 31, 2020EUR (€)CAD ($) | Aug. 31, 2019EUR (€)CAD ($) | |
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Reclassified from accumulated other comprehensive income to net earnings over the next 12 months | $ (1,100) | $ (744) | $ 972 | |||
Foreign Exchange Gains (Losses) on Foreign Exchange Contracts [Abstract] | ||||||
Gain (losses) on forward exchange contracts | (1,028) | (591) | $ 875 | |||
Financial liabilities [Abstract] | ||||||
Nominal value of outstanding financial liabilities | $ 58,500 | 61,400 | ||||
Interest rate risk [Abstract] | ||||||
Percentage of change in interest rate would not have insignificant impact | 1.00% | |||||
Short-term investments [Abstract] | ||||||
Short-term investments | $ 919 | 2,918 | ||||
Forecast [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Reclassified from accumulated other comprehensive income to net earnings over the next 12 months | $ 868 | |||||
Current Assets [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts, assets | 1,018 | 79 | ||||
Long-Term Assets [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts, assets | 569 | |||||
Other Accounts Receivable [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts, assets | 40 | |||||
Forward exchange contracts recognized in earnings | 40 | |||||
Other Accounts Payable and Accrued Liabilities [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts recognized in earnings | 167 | |||||
Forward exchange contracts, liabilities | 167 | |||||
Current Liabilities [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts, liabilities | 110 | 845 | ||||
Long-term Liabilities [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Forward exchange contracts, liabilities | 212 | |||||
Accounts Payable and Accrued Liabilities [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 41,238 | 49,945 | ||||
Forward Exchange Contracts [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 110 | 1,057 | ||||
Cash [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 32,818 | 16,518 | ||||
Accounts Receivables [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 59,328 | 54,834 | ||||
Forward Exchange Contracts [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 1,587 | 79 | ||||
Currency Risk [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 43,828 | 35,982 | € 16,959 | € 9,518 | ||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 36,783 | 23,363 | 1,693 | 2,218 | ||
Net exposure | 7,045 | 12,619 | 15,266 | 7,300 | ||
Currency Risk [Member] | Bank Loan [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 22,000 | 5,000 | 0 | 0 | ||
Currency Risk [Member] | Accounts Payable and Accrued Liabilities [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 8,683 | 12,563 | 1,693 | 2,218 | ||
Currency Risk [Member] | Forward Exchange Contracts [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Financial liabilities | 6,100 | 5,800 | 0 | 0 | ||
Currency Risk [Member] | Cash [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 10,147 | 5,531 | 8,152 | 3,129 | ||
Currency Risk [Member] | Accounts Receivables [Member] | ||||||
Financial assets [Abstract] | ||||||
Financial assets | 33,681 | 30,451 | € 8,807 | € 6,389 | ||
Indian Rupees [Member] | September 2019 to August 2020 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 3,500 | |||||
Weighted average contractual forward rates | $ / shares | 71.48 | |||||
Indian Rupees [Member] | September 2020 to February 2021 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 1,500 | |||||
Weighted average contractual forward rates | $ / shares | 77.56 | |||||
US Dollars [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Foreign currency comparison rate | 1.3041 | 1.3294 | 1.3041 | 1.3294 | ||
Canadian Dollars [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 58,500 | $ 61,400 | ||||
Weighted average contractual forward rates | $ / shares | 1.3353 | 1.3063 | ||||
Financial liabilities [Abstract] | ||||||
Percentage of increase (decrease) period-end value Canadian dollars comparison on net loss | 10.00% | 10.00% | ||||
Increase (decrease) period-end value Canadian dollars comparison on net loss | $ 962 | $ 1,166 | ||||
Increase (decrease) period-end value Canadian dollars comparison on net loss per share (in dollars per share) | $ / shares | $ 0.02 | $ 0.02 | ||||
Percentage of increase (decrease) period-end value Canadian dollars comparison on other comprehensive income | 10.00% | 10.00% | ||||
Increase (decrease) period-end value Canadian dollars comparison on other comprehensive loss | $ 3,769 | $ 4,072 | ||||
Canadian Dollars [Member] | September 2019 to August 2020 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 35,500 | |||||
Weighted average contractual forward rates | $ / shares | 1.3013 | |||||
Canadian Dollars [Member] | September 2020 to August 2021 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 36,100 | $ 19,900 | ||||
Weighted average contractual forward rates | $ / shares | 1.3283 | 1.3107 | ||||
Canadian Dollars [Member] | September 2021 to July 2022 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 6,000 | |||||
Weighted average contractual forward rates | $ / shares | 1.3216 | |||||
Canadian Dollars [Member] | September 2021 to August 2022 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 18,800 | |||||
Weighted average contractual forward rates | $ / shares | 1.3492 | |||||
Canadian Dollars [Member] | September 2022 to February 2023 [Member] | ||||||
Contracts to Sell at Various Forward Rates [Abstract] | ||||||
Contractual amounts | $ 3,600 | |||||
Weighted average contractual forward rates | $ / shares | 1.3324 | |||||
Euro [Member] | ||||||
Financial liabilities [Abstract] | ||||||
Foreign currency comparison rate | 1.5571 | 1.4672 | 1.5571 | 1.4672 | ||
Percentage of increase (decrease) period-end value Canadian dollars comparison on net loss | 10.00% | 10.00% | ||||
Increase (decrease) period-end value Canadian dollars comparison on net loss | $ 1,496 | $ 796 | ||||
Increase (decrease) period-end value Canadian dollars comparison on net loss per share (in dollars per share) | $ / shares | $ 0.03 | $ 0.01 | ||||
Term Deposits [Member] | Indian Rupees [Member] | ||||||
Short-term investments [Abstract] | ||||||
Short-term investments | $ 728 | $ 2,548 | ||||
Term Deposits [Member] | Indian Rupees [Member] | Bottom of Range [Member] | ||||||
Short-term investments [Abstract] | ||||||
Annual interest rate | 3.00% | 5.10% | ||||
Maturity date | December 31, 2020 | September 30, 2019 | ||||
Term Deposits [Member] | Indian Rupees [Member] | Top of Range [Member] | ||||||
Short-term investments [Abstract] | ||||||
Annual interest rate | 6.30% | 7.00% | ||||
Maturity date | February 28, 2023 | May 31, 2020 | ||||
Other [Member] | ||||||
Short-term investments [Abstract] | ||||||
Short-term investments | $ 191 | $ 370 |
Financial Instruments, Credit R
Financial Instruments, Credit Risk (Details) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020USD ($)Customer | Aug. 31, 2019USD ($)Customer | Aug. 31, 2018USD ($)Customer | |
Financial Instruments [Abstract] | |||
Period of payment profiles of sales used in calculating expected loss rates | 60 months | ||
Number of customers representing more than 10% of total sales | Customer | 0 | 0 | 0 |
Trade account receivable [Abstract] | |||
Trade accounts receivable | $ 56,291 | $ 51,517 | |
Changes in allowance for doubtful accounts [Abstract] | |||
Balance - Beginning of year | 1,535 | 772 | |
IFRS 9 adoption initial adjustment | 0 | 303 | |
Addition charged to net loss | 1,173 | 864 | |
Write-off of uncollectible accounts and reversal | (953) | (404) | |
Balance - End of year | 1,755 | 1,535 | $ 772 |
Current [Member] | |||
Trade account receivable [Abstract] | |||
Trade accounts receivable | 40,595 | 39,054 | |
Past Due, 0 to 30 Days [Member] | |||
Trade account receivable [Abstract] | |||
Trade accounts receivable | 7,622 | 3,529 | |
Past Due, 31 to 60 Days [Member] | |||
Trade account receivable [Abstract] | |||
Trade accounts receivable | 1,677 | 2,006 | |
Past Due, More than 60 Days [Member] | |||
Trade account receivable [Abstract] | |||
Trade accounts receivable | $ 6,397 | $ 6,928 |
Financial Instruments, Liquidit
Financial Instruments, Liquidity Risk (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Derivative and non-derivative financial liabilities [Abstract] | ||
Bank loan | $ 32,737 | $ 5,000 |
Accounts payable and accrued liabilities | 41,348 | 50,790 |
Forward exchange contracts [Abstract] | ||
Long-term debt | 2,144 | 3,293 |
Other liabilities | 151 | 318 |
Cash and short-term investments | 33,737 | |
Accounts receivable | 60,346 | |
Unused available lines of credit for working capital and other general corporate purposes | 44,485 | |
Unused lines of credit for foreign currency exposure | 22,416 | |
Liquidity Risk [Member] | No Later than One Year [Member] | ||
Derivative and non-derivative financial liabilities [Abstract] | ||
Bank loan | 32,737 | 5,000 |
Accounts payable and accrued liabilities | 41,238 | 49,945 |
Forward exchange contracts [Abstract] | ||
Outflow | 37,600 | 39,000 |
Inflow | (38,364) | (38,252) |
Long-term debt | 2,076 | 2,449 |
Other liabilities | 4,032 | 1,606 |
Financial liabilities | 79,319 | 59,748 |
Liquidity Risk [Member] | Later than 1 Year and no Later than 5 Years [Member] | ||
Derivative and non-derivative financial liabilities [Abstract] | ||
Bank loan | 0 | 0 |
Accounts payable and accrued liabilities | 0 | 0 |
Forward exchange contracts [Abstract] | ||
Outflow | 22,400 | 25,900 |
Inflow | (23,128) | (25,585) |
Long-term debt | 2,144 | 3,237 |
Other liabilities | 0 | 0 |
Financial liabilities | $ 1,416 | 3,552 |
Liquidity Risk [Member] | Later than 5 Years [Member] | ||
Derivative and non-derivative financial liabilities [Abstract] | ||
Bank loan | 0 | |
Accounts payable and accrued liabilities | 0 | |
Forward exchange contracts [Abstract] | ||
Outflow | 0 | |
Inflow | 0 | |
Long-term debt | 56 | |
Other liabilities | 0 | |
Financial liabilities | $ 56 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Inventories [Abstract] | |||
Raw materials | $ 22,487 | $ 24,115 | |
Work in progress | 3,846 | 1,009 | |
Finished goods | 12,532 | 12,893 | |
Inventories | 38,865 | 38,017 | |
Inventory recognized as an expense | 122,679 | 127,725 | $ 116,923 |
Inventory writedown | $ 2,629 | $ 3,270 | $ 2,541 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Property, Plant and Equipment [Abstract] | ||
Beginning balance | $ 39,364 | |
Ending balance | 39,722 | $ 39,364 |
Unpaid additions to property, plant and equipment | 92 | 894 |
Cost [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 73,314 | 78,841 |
Additions | 5,019 | 4,980 |
Disposals | (1,161) | (8,357) |
Foreign currency translation adjustment | 1,876 | (2,150) |
Ending balance | 79,048 | 73,314 |
Accumulated Depreciation [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | (33,950) | (34,531) |
Depreciation | 5,563 | 5,469 |
Disposals | (1,161) | (5,239) |
Foreign currency translation adjustment | 974 | (811) |
Ending balance | (39,326) | (33,950) |
Land and Land Improvements [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 2,807 | |
Ending balance | 2,814 | 2,807 |
Land and Land Improvements [Member] | Cost [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 4,091 | 4,359 |
Additions | 0 | 0 |
Disposals | 0 | (192) |
Foreign currency translation adjustment | 79 | (76) |
Ending balance | 4,170 | 4,091 |
Land and Land Improvements [Member] | Accumulated Depreciation [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | (1,284) | (1,290) |
Depreciation | 46 | 47 |
Disposals | 0 | 0 |
Foreign currency translation adjustment | 26 | (53) |
Ending balance | (1,356) | (1,284) |
Buildings [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 23,736 | |
Ending balance | 24,427 | 23,736 |
Buildings [Member] | Cost [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 29,492 | 32,346 |
Additions | 933 | 1,116 |
Disposals | (31) | (3,378) |
Foreign currency translation adjustment | 591 | (592) |
Ending balance | 30,985 | 29,492 |
Buildings [Member] | Accumulated Depreciation [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | (5,756) | (6,661) |
Depreciation | 686 | 667 |
Disposals | (31) | (1,452) |
Foreign currency translation adjustment | 147 | (120) |
Ending balance | (6,558) | (5,756) |
Equipment [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 11,557 | |
Ending balance | 11,370 | 11,557 |
Equipment [Member] | Cost [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 36,836 | 39,088 |
Additions | 3,949 | 3,700 |
Disposals | (1,120) | (4,623) |
Foreign currency translation adjustment | 1,080 | (1,329) |
Ending balance | 40,745 | 36,836 |
Equipment [Member] | Accumulated Depreciation [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | (25,279) | (25,163) |
Depreciation | 4,449 | 4,391 |
Disposals | (1,120) | (3,673) |
Foreign currency translation adjustment | 767 | (602) |
Ending balance | (29,375) | (25,279) |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 1,264 | |
Ending balance | 1,111 | 1,264 |
Leasehold Improvements [Member] | Cost [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | 2,895 | 3,048 |
Additions | 137 | 164 |
Disposals | (10) | (164) |
Foreign currency translation adjustment | 126 | (153) |
Ending balance | 3,148 | 2,895 |
Leasehold Improvements [Member] | Accumulated Depreciation [Member] | ||
Property, Plant and Equipment [Abstract] | ||
Beginning balance | (1,631) | (1,417) |
Depreciation | 382 | 364 |
Disposals | (10) | (114) |
Foreign currency translation adjustment | 34 | (36) |
Ending balance | $ (2,037) | $ (1,631) |
Lease Right-of-Use Assets (Deta
Lease Right-of-Use Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Lease, Right-of-use Assets [Abstract] | |||
Balance | $ 0 | ||
Depreciation for the year (note 20) | 3,349 | $ 0 | $ 0 |
Balance | 10,758 | 0 | |
Cost [Member] | |||
Lease, Right-of-use Assets [Abstract] | |||
Balance | 0 | ||
Adoption of IFRS 16 (note 2) | 11,321 | ||
Additions | 2,103 | ||
Foreign currency translation adjustment | 555 | ||
Balance | 13,979 | 0 | |
Accumulated Depreciation [Member] | |||
Lease, Right-of-use Assets [Abstract] | |||
Balance | 0 | ||
Depreciation for the year (note 20) | 3,349 | ||
Foreign currency translation adjustment | (128) | ||
Balance | $ (3,221) | $ 0 |
Intangible Assets and Goodwill,
Intangible Assets and Goodwill, Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Intangible Assets [Abstract] | ||
Beginning balance | $ 21,654 | |
Ending balance | 17,616 | $ 21,654 |
Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 50,779 | 52,097 |
Additions | 1,825 | 2,082 |
Disposal | (3,215) | (542) |
Foreign currency translation adjustment | 3,023 | (2,858) |
Ending balance | 52,412 | 50,779 |
Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | (29,125) | (22,231) |
Amortization | 6,467 | 9,012 |
Disposal | (2,992) | (238) |
Foreign currency translation adjustment | 2,196 | (1,880) |
Ending balance | (34,796) | (29,125) |
Core Technology [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 13,002 | |
Ending balance | $ 10,122 | 13,002 |
Remaining amortization period, end of period | 3 years | |
Core Technology [Member] | Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | $ 26,439 | 28,058 |
Additions | 427 | 363 |
Disposal | (181) | (27) |
Foreign currency translation adjustment | 1,939 | (1,955) |
Ending balance | 28,624 | 26,439 |
Core Technology [Member] | Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | (13,437) | (9,610) |
Amortization | 3,946 | 4,926 |
Disposal | (111) | (19) |
Foreign currency translation adjustment | 1,230 | (1,080) |
Ending balance | (18,502) | (13,437) |
Customer Relationships [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 3,792 | |
Ending balance | $ 2,494 | 3,792 |
Remaining amortization period, end of period | 1 year | |
Customer Relationships [Member] | Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | $ 9,673 | 10,291 |
Additions | 0 | 0 |
Disposal | 0 | 0 |
Foreign currency translation adjustment | 561 | (618) |
Ending balance | 10,234 | 9,673 |
Customer Relationships [Member] | Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | (5,881) | (3,933) |
Amortization | 1,259 | 2,372 |
Disposal | 0 | 0 |
Foreign currency translation adjustment | 600 | (424) |
Ending balance | (7,740) | (5,881) |
In-process Research and Development [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 0 | |
Ending balance | $ 0 | 0 |
Remaining amortization period, end of period | 0 years | |
In-process Research and Development [Member] | Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | $ 0 | 292 |
Additions | 0 | 0 |
Disposal | 0 | (293) |
Foreign currency translation adjustment | 0 | 1 |
Ending balance | 0 | 0 |
In-process Research and Development [Member] | Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 0 | 0 |
Amortization | 0 | 0 |
Disposal | 0 | 0 |
Foreign currency translation adjustment | 0 | 0 |
Ending balance | 0 | 0 |
Brand Name [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 0 | |
Ending balance | $ 0 | 0 |
Remaining amortization period, end of period | 0 years | |
Brand Name [Member] | Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | $ 750 | 796 |
Additions | 0 | 0 |
Disposal | (812) | 0 |
Foreign currency translation adjustment | 62 | (46) |
Ending balance | 0 | 750 |
Brand Name [Member] | Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | (750) | (512) |
Amortization | 0 | 284 |
Disposal | (812) | 0 |
Foreign currency translation adjustment | 62 | (46) |
Ending balance | 0 | (750) |
Software [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | 4,860 | |
Ending balance | $ 5,000 | 4,860 |
Remaining amortization period, end of period | 3 years | |
Software [Member] | Cost [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | $ 13,917 | 12,660 |
Additions | 1,398 | 1,719 |
Disposal | (2,222) | (222) |
Foreign currency translation adjustment | 461 | (240) |
Ending balance | 13,554 | 13,917 |
Software [Member] | Accumulated Amortization [Member] | ||
Intangible Assets [Abstract] | ||
Beginning balance | (9,057) | (8,176) |
Amortization | 1,262 | 1,430 |
Disposal | (2,069) | (219) |
Foreign currency translation adjustment | 304 | (330) |
Ending balance | $ (8,554) | $ (9,057) |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill, Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Goodwill [Abstract] | ||
Balance - Beginning of year | $ 38,648 | $ 39,892 |
Foreign currency translation adjustment | 1,692 | (1,244) |
Balance - End of year | $ 40,290 | $ 38,648 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill, Goodwill Allocated to CGUs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Goodwill CGUs [Abstract] | |||
Goodwill | $ 40,290 | $ 38,648 | $ 39,892 |
EXFO CGU [Member] | |||
Goodwill CGUs [Abstract] | |||
Goodwill | 13,200 | 12,949 | |
EXFO Optics CGU [Member] | |||
Goodwill CGUs [Abstract] | |||
Goodwill | 3,648 | 3,376 | |
Service Assurance, Systems and Services CGU [Member] | |||
Goodwill CGUs [Abstract] | |||
Goodwill | $ 23,442 | $ 22,323 | |
Service Assurance, Systems and Services CGU [Member] | Cost Approach [Member] | |||
Goodwill CGUs [Abstract] | |||
Period of liquidation approach | two years |
Credit Facilities (Details)
Credit Facilities (Details) € in Thousands, ₨ in Thousands, $ in Thousands, $ in Thousands | Jun. 01, 2021CAD ($) | Aug. 31, 2020USD ($) | Aug. 31, 2020EUR (€) | Aug. 31, 2020CAD ($) | Aug. 31, 2020INR (₨) | May 31, 2020USD ($) | May 31, 2020CAD ($) |
Canadian Revolving Line of Credit [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | $ 53,677 | $ 70,000 | |||||
Canadian Revolving Line of Credit [Member] | Forecast [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | $ 70,000 | ||||||
Amended Canadian Revolving Line of Credit [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | $ 69,013 | $ 90,000 | |||||
US Dollar Revolving Line of Credit [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | $ 9,000 | ||||||
Revolving Line of Credit [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Amount drawn from lines of credit | 33,783 | ||||||
Revolving Line of Credit [Member] | Bank Loan [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Amount drawn from lines of credit | 32,737 | ||||||
Revolving Line of Credit [Member] | Letters of Guarantee [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Amount drawn from lines of credit | 1,046 | ||||||
Line of Credit, Foreign Currency Risk [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | 23,719 | ||||||
Amount reserved from line of credit | 3,093 | ||||||
INR Line of Credit, Foreign Currency Risk [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | 1,800 | ₨ 131,387 | |||||
Amount reserved from line of credit | 10 | ₨ 730 | |||||
Euro Dollar Revolving Line of Credit [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Line of credit maximum borrowing capacity | 478 | € 400 | |||||
Euro Dollar Revolving Line of Credit [Member] | Letters of Guarantee [Member] | |||||||
Credit Facilities [Abstract] | |||||||
Amount drawn from lines of credit | $ 223 | € 187 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Liabilities and Provisions (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Accounts payable and accrued liabilities [Abstract] | ||
Trade | $ 21,407 | $ 27,996 |
Salaries and social benefits | 17,998 | 19,716 |
Forward exchange contracts (note 6) | 110 | 845 |
Other | 1,833 | 2,233 |
Accounts payable and accrued liabilities | 41,348 | 50,790 |
Provisions [Abstract] | ||
Warranty | 380 | 356 |
Restructuring charges (note 4) | 3,626 | 1,133 |
Other | 2,568 | 2,313 |
Provisions | $ 6,574 | $ 3,802 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Minimal rentals payable under operating leases [abstract] | ||
Discounted operating lease commitments under IAS 17 | $ 8,915 | |
Discounted impact of renewal options that are reasonably certain to be exercised | 1,928 | |
Operating Lease Liabilities | $ 10,583 | $ 10,843 |
Incremental borrowing rate applied to lease liabilities recognised at date of initial application of IFRS 16 | 2.00% | |
No Later than 1 Year [Member] | ||
Minimal rentals payable under operating leases [abstract] | ||
Operating Lease Liabilities | 3,249 | |
Later than 1 Year and no Later than 5 Years [Member] | ||
Minimal rentals payable under operating leases [abstract] | ||
Operating Lease Liabilities | 6,377 | |
Later than 5 Years [Member] | ||
Minimal rentals payable under operating leases [abstract] | ||
Operating Lease Liabilities | $ 957 | |
Bottom of Range [Member] | ||
Minimal rentals payable under operating leases [abstract] | ||
Remaining lease term | 1 year | |
Top of Range [Member] | ||
Minimal rentals payable under operating leases [abstract] | ||
Remaining lease term | 8 years |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Long-term Debt [Abstract] | ||
Total long-term debt | $ 4,220 | $ 5,742 |
Current portion of long-term debt | 2,076 | 2,449 |
Long-term Debt | 2,144 | 3,293 |
Unsecured Non-interest-bearing Loans Maturing in March 2024 and March 2025 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 896 | 866 |
Unsecured Non-interest-bearing Loans Maturing in March 2024 and March 2025 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, maturity | March 2024 | |
Unsecured Non-interest-bearing Loans Maturing in March 2024 and March 2025 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, maturity | March 2025 | |
Unsecured Loans Maturing Between March 2020 and September 2023 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 3,111 | |
Unsecured Loans Maturing Between March 2020 and September 2023 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 0.00% | |
Long-term debt, maturity | March 2020 | |
Unsecured Loans Maturing Between March 2020 and September 2023 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 5.00% | |
Long-term debt, maturity | September 2023 | |
Unsecured Loans Maturing Between December 2020 and September2023 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 2,443 | |
Unsecured Loans Maturing Between December 2020 and September2023 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 0.00% | |
Long-term debt, maturity | December 2020 | |
Unsecured Loans Maturing Between December 2020 and September2023 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 5.00% | |
Long-term debt, maturity | September 2023 | |
Secured Loans Maturing Between April 2020 and August 2022 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 459 | |
Secured Loans Maturing Between April 2020 and August 2022 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 0.70% | |
Long-term debt, maturity | April 2020 | |
Secured Loans Maturing Between April 2020 and August 2022 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 1.50% | |
Long-term debt, maturity | August 2022 | |
Secured Loans Maturing Between February 2021 and August2022 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 295 | |
Secured Loans Maturing Between February 2021 and August2022 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 0.70% | |
Long-term debt, maturity | February 2021 | |
Secured Loans Maturing Between February 2021 and August2022 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 1.50% | |
Long-term debt, maturity | August 2022 | |
Secured Loans Maturing Between March 2020 to July 2022 and December 2020 to July 2022 [Member] | Euro [Member] | ||
Long-term Debt [Abstract] | ||
Total long-term debt | $ 586 | $ 1,306 |
Secured Loans Maturing Between March 2020 and July 2022 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 1.10% | |
Long-term debt, maturity | March 2020 | |
Secured Loans Maturing Between March 2020 and July 2022 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 2.90% | |
Long-term debt, maturity | July 2022 | |
Secured Loans Maturing Between December 2020 and July 2022 [Member] | Euro [Member] | Bottom of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 1.10% | |
Long-term debt, maturity | December 2020 | |
Secured Loans Maturing Between December 2020 and July 2022 [Member] | Euro [Member] | Top of Range [Member] | ||
Long-term Debt [Abstract] | ||
Long-term debt, interest rate | 2.90% | |
Long-term debt, maturity | July 2022 |
Long-Term Debt, Principal Repay
Long-Term Debt, Principal Repayments of Long-term Debt (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Principal repayments of long-term debt [Abstract] | ||
Long-term debt | $ 4,220 | $ 5,742 |
No Later than One Year [Member] | ||
Principal repayments of long-term debt [Abstract] | ||
Long-term debt | 2,076 | |
Later than One Year and No Later than Five Years [Member] | ||
Principal repayments of long-term debt [Abstract] | ||
Long-term debt | $ 2,144 |
Commitments (Details)
Commitments (Details) - Intellectual Property [Member] $ in Thousands | Aug. 31, 2020USD ($) |
License Agreements for Intellectual Property [Abstract] | |
License fees payable under license agreements | $ 2,400 |
No Later than One Year [Member] | |
License Agreements for Intellectual Property [Abstract] | |
License fees payable under license agreements | 1,779 |
Later than One Year and No Later than Five Years [Member] | |
License Agreements for Intellectual Property [Abstract] | |
License fees payable under license agreements | $ 621 |
Share Capital (Details)
Share Capital (Details) $ in Thousands | Jan. 07, 2020shares | Jan. 08, 2019shares | Aug. 31, 2020USD ($)Voteshares | Aug. 31, 2019USD ($)shares | Aug. 31, 2018USD ($)shares |
Share Capital [Abstract] | |||||
Balance, beginning of period | $ 172,564 | $ 177,921 | $ 196,790 | ||
Reclassification of stock-based compensation costs to share capital upon exercise of stock awards | 0 | 0 | 0 | ||
Adoption of IFRS 9 (note 2) | 172,563 | 172,564 | 177,921 | ||
Share Capital [Member] | |||||
Share Capital [Abstract] | |||||
Balance, beginning of period | 92,706 | 91,937 | 90,411 | ||
Redemption of restricted share units (note 18) | 0 | 0 | 0 | ||
Redemption of deferred share units (note 18) | 0 | ||||
Redemption of share capital | (212) | (337) | |||
Reclassification of stock-based compensation costs to share capital upon exercise of stock awards | 1,530 | 1,106 | 1,526 | ||
Adoption of IFRS 9 (note 2) | $ 94,024 | $ 92,706 | $ 91,937 | ||
Top of Range [Member] | |||||
Share Capital [Abstract] | |||||
Percentage on the open market for issued and outstanding subordinate voting shares | 3.10% | 6.30% | |||
Multiple Voting Shares [Member] | |||||
Share Capital [Abstract] | |||||
Number of votes per share | Vote | 10 | ||||
Conversion ratio | 1 | ||||
Multiple Voting Shares [Member] | Share Capital [Member] | |||||
Share Capital [Abstract] | |||||
Balance, beginning of period (in shares) | shares | 31,643,000 | 31,643,000 | 31,643,000 | ||
Balance, beginning of period | $ 1 | $ 1 | $ 1 | ||
Redemption of restricted share units (note 18) (in shares) | shares | 0 | 0 | 0 | ||
Redemption of restricted share units (note 18) | $ 0 | $ 0 | $ 0 | ||
Redemption of deferred share units (note 18) (in shares) | shares | 0 | ||||
Redemption of deferred share units (note 18) | $ 0 | ||||
Redemption of share capital (in shares) | shares | 0 | 0 | |||
Redemption of share capital | $ 0 | $ 0 | |||
Reclassification of stock-based compensation costs to share capital upon exercise of stock awards | $ 0 | $ 0 | $ 0 | ||
Balance, end of period (in shares) | shares | 31,643,000 | 31,643,000 | 31,643,000 | ||
Adoption of IFRS 9 (note 2) | $ 1 | $ 1 | $ 1 | ||
Subordinate Voting Shares [Member] | |||||
Share Capital [Abstract] | |||||
Subordinate voting shares under share repurchase program (in shares) | shares | 600,000 | 1,200,000 | |||
Subordinate Voting Shares [Member] | Share Capital [Member] | |||||
Share Capital [Abstract] | |||||
Balance, beginning of period (in shares) | shares | 23,703,675 | 23,472,995 | 23,068,777 | ||
Balance, beginning of period | $ 92,705 | $ 91,936 | $ 90,410 | ||
Redemption of restricted share units (note 18) (in shares) | shares | 411,619 | 317,072 | 345,883 | ||
Redemption of restricted share units (note 18) | $ 0 | $ 0 | $ 0 | ||
Redemption of deferred share units (note 18) (in shares) | shares | 58,335 | ||||
Redemption of deferred share units (note 18) | $ 0 | ||||
Redemption of share capital (in shares) | shares | (54,528) | (86,392) | |||
Redemption of share capital | $ (212) | $ (337) | |||
Reclassification of stock-based compensation costs to share capital upon exercise of stock awards | $ 1,530 | $ 1,106 | $ 1,526 | ||
Balance, end of period (in shares) | shares | 24,060,766 | 23,703,675 | 23,472,995 | ||
Adoption of IFRS 9 (note 2) | $ 94,023 | $ 92,705 | $ 91,936 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Changes in accumulated other comprehensive loss [Abstract] | |||
Balance, beginning of period | $ (51,511) | ||
Foreign currency translation adjustment | 5,994 | $ (4,177) | $ (6,491) |
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | 1,743 | 16 | (1,894) |
Balance, end of period | (43,774) | (51,511) | |
Foreign Currency Translation Adjustment [Member] | |||
Changes in accumulated other comprehensive loss [Abstract] | |||
Balance, beginning of period | (51,542) | (47,365) | (40,874) |
Foreign currency translation adjustment | 5,994 | (4,177) | (6,491) |
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | 0 | 0 | 0 |
Balance, end of period | (45,548) | (51,542) | (47,365) |
Cash-flow Hedge [Member] | |||
Changes in accumulated other comprehensive loss [Abstract] | |||
Balance, beginning of period | 31 | 15 | 1,909 |
Foreign currency translation adjustment | 0 | 0 | 0 |
Changes in unrealized gains/losses on forward exchange contracts, net of deferred income taxes | 1,743 | 16 | (1,894) |
Balance, end of period | 1,774 | 31 | 15 |
Accumulated Other Comprehensive Loss [Member] | |||
Changes in accumulated other comprehensive loss [Abstract] | |||
Balance, beginning of period | (51,511) | (47,350) | (38,965) |
Balance, end of period | $ (43,774) | $ (51,511) | $ (47,350) |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Stock-based compensation costs recognized for employee services [Abstract] | |||
Stock-based compensation costs arising from equity-settled awards | $ 2,027 | $ 1,849 | $ 1,770 |
Stock-based compensation costs arising from cash-settled awards | (6) | (18) | (22) |
Share-based compensation costs | $ 2,021 | $ 1,831 | $ 1,748 |
Top of Range [Member] | |||
Stock-Based Compensation Plans [Abstract] | |||
Number of additional subordinate voting shares issuable under the Long-Term Incentive Plan and the Deferred Share Unit Plan (in shares) | 11,792,893 | ||
Number of subordinate voting shares that may be granted to any individual on an annual basis, percentage | 5.00% |
Stock-Based Compensation Plans,
Stock-Based Compensation Plans, Long-Term Incentive Plan (Details) | 12 Months Ended | ||
Aug. 31, 2020shares$ / shares | Aug. 31, 2019shares$ / shares | Aug. 31, 2018shares$ / shares | |
Stock Options [Member] | |||
Stock Options [Abstract] | |||
Expiry period | P10Y | ||
Vesting period | P4Y | ||
Annual vesting percentage | 25.00% | ||
Number of Share Options [Abstract] | |||
Outstanding (in shares) | 0 | 0 | |
Exercisable (in shares) | 0 | 0 | |
Performance Share Units [Member] | |||
RSU Activity [Abstract] | |||
Outstanding - Beginning of year (in shares) | 0 | ||
Granted (in shares) | 143,251 | ||
Outstanding - End of year (in shares) | 143,251 | 0 | |
Outstanding units redeemable (in shares) | 0 | ||
Weighted average grant-date fair value (in dollars per share) | $ / shares | $ 3.84 | ||
Performance Share Units [Member] | Bottom of Range [Member] | |||
Stock Options [Abstract] | |||
Vesting period | P3Y | ||
Performance Share Units [Member] | Top of Range [Member] | |||
Stock Options [Abstract] | |||
Vesting period | P10Y | ||
Restricted Stock Units [Member] | |||
RSU Activity [Abstract] | |||
Outstanding - Beginning of year (in shares) | 1,836,446 | 1,615,152 | 1,611,330 |
Granted (in shares) | 439,220 | 632,931 | 420,621 |
Redeemed (in shares) | (411,619) | (317,072) | (345,883) |
Forfeited (in shares) | (150,932) | (94,565) | (70,916) |
Outstanding - End of year (in shares) | 1,713,115 | 1,836,446 | 1,615,152 |
Outstanding units redeemable (in shares) | 0 | 0 | |
Weighted average grant-date fair value (in dollars per share) | $ / shares | $ 4.02 | $ 3.30 | $ 4.22 |
Weighted-average market price of redeemed shares (in dollars per share) | $ / shares | $ 3.92 | $ 3.20 | $ 4.19 |
Restricted Stock Units [Member] | Bottom of Range [Member] | |||
Stock Options [Abstract] | |||
Vesting period | P3Y | ||
Restricted Stock Units [Member] | Top of Range [Member] | |||
Stock Options [Abstract] | |||
Vesting period | P10Y |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans, Deferred Share Unit Plan (Details) - Deferred Share Unit Plan [Member] | 12 Months Ended | ||
Aug. 31, 2020shares$ / shares | Aug. 31, 2019shares$ / shares | Aug. 31, 2018shares$ / shares | |
Deferred Share Unit Plan [Abstract] | |||
Number of subordinate voting share to receive by directors against each DSU (in shares) | 1 | ||
DSU Activity [Abstract] | |||
Outstanding - Beginning of year (in shares) | 251,507 | 181,689 | 174,279 |
Granted (in shares) | 79,819 | 69,818 | 65,745 |
Redeemed (in shares) | 0 | 0 | (58,335) |
Outstanding - End of year (in shares) | 331,326 | 251,507 | 181,689 |
Outstanding units redeemable (in shares) | 0 | 0 | 0 |
Weighted average grant-date fair value (in dollars per share) | $ / shares | $ 3.43 | $ 3.64 | $ 4.10 |
Weighted-average market price of redeemed shares (in dollars per share) | $ / shares | $ 4.29 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans, Stock Appreciation Rights Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Stock Appreciation Rights Plan [Abstract] | ||
Accounts payable and accrued liabilities | $ 41,348 | $ 50,790 |
Stock Appreciation Rights Plan [Member] | ||
Stock Appreciation Rights Plan [Abstract] | ||
Expiry period | P10Y | |
Vesting period | P4Y | |
Accounts payable and accrued liabilities | $ 70 | $ 77 |
Related Party Disclosures (Deta
Related Party Disclosures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Related Party Disclosures [Abstract] | |||
Salaries and short-term employee benefits | $ 4,086 | $ 4,029 | $ 3,985 |
Stock-based compensation costs | 1,391 | 1,175 | 1,047 |
Total | $ 5,477 | $ 5,204 | $ 5,032 |
Statements of Earnings (Details
Statements of Earnings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Sales [Abstract] | |||
Test and measurement | $ 197,419 | $ 204,693 | $ 197,423 |
Service assurance, systems and services | 69,192 | 82,788 | 71,248 |
Foreign exchange gains (losses) on forward exchange contracts | (1,028) | (591) | 875 |
Total sales for the year | 265,583 | 286,890 | 269,546 |
Net research and development expenses [Abstract] | |||
Gross research and development expenses | 54,564 | 57,972 | 65,243 |
Research and development tax credits and grants | (9,077) | (7,419) | (8,089) |
Net research and development expenses for the year | 45,487 | 50,553 | 57,154 |
Tax credits and grants for CEWS | 1,457 | 0 | 0 |
Cost of sales [Abstract] | |||
Depreciation of property, plant and equipment | 1,923 | 1,862 | 2,077 |
Depreciation of lease ROU assets | 1,106 | 0 | 0 |
Amortization of intangible assets | 5,092 | 7,186 | 9,212 |
Total depreciation and amortization expense | 8,121 | 9,048 | 11,289 |
Selling and administrative expenses [Abstract] | |||
Depreciation of property, plant and equipment | 1,080 | 1,354 | 902 |
Depreciation of lease ROU assets | 1,472 | 0 | 0 |
Amortization of intangible assets | 698 | 1,043 | 592 |
Total depreciation and amortization expenses for the year | 3,250 | 2,397 | 1,494 |
Net research and development expenses [Abstract] | |||
Depreciation of property, plant and equipment | 2,560 | 2,253 | 2,465 |
Depreciation of lease ROU assets | 771 | 0 | 0 |
Amortization of intangible assets | 677 | 783 | 523 |
Total depreciation and amortization expenses for the year | 4,008 | 3,036 | 2,988 |
Depreciation of property, plant and equipment | 5,563 | 5,469 | 5,444 |
Depreciation of lease ROU assets | 3,349 | 0 | 0 |
Amortization of intangible assets | 6,467 | 9,012 | 10,327 |
Total depreciation and amortization expenses for the year | 15,379 | 14,481 | 15,771 |
Employee compensation [Abstract] | |||
Salaries and benefits | 142,277 | 136,059 | 134,453 |
Restructuring charges | 2,808 | 3,305 | 2,072 |
Stock-based compensation costs | 2,021 | 1,831 | 1,748 |
Grants (CEWS) | (3,262) | 0 | 0 |
Total employee compensation for the year | 143,844 | 141,195 | 138,273 |
Restructuring charges [Abstract] | |||
Cost of sales | 898 | 304 | 517 |
Selling and administrative expenses | 1,882 | 495 | 673 |
Net research and development costs | 106 | 2,506 | 3,219 |
Interest and other expense | 0 | 0 | 150 |
Restructuring charges, gross | 2,886 | 3,305 | 4,559 |
Income taxes | (533) | (63) | (1,150) |
Total restructuring charges for the year | 2,353 | 3,242 | 3,409 |
Stock-based compensation costs [Abstract] | |||
Cost of sales | 129 | 136 | 143 |
Selling and administrative expenses | 1,548 | 1,375 | 1,217 |
Net research and development expenses | 344 | 320 | 388 |
Total stock-based compensation costs for the year | 2,021 | 1,831 | 1,748 |
CEWS [Abstract] | |||
Cost of sales | (723) | 0 | 0 |
Selling and administrative expenses | (1,082) | 0 | 0 |
Net research and development expenses | (1,457) | 0 | 0 |
Total CEWS for the year | $ (3,262) | $ 0 | $ 0 |
Other Disclosures (Details)
Other Disclosures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Other assets [Abstract] | |||
Carrying value of contract assets | $ 5,493 | $ 3,083 | |
Deferred revenue [Abstract] | |||
Deferred revenue | 34,643 | ||
Deferred revenue to be recognized during next 12 months | 25,785 | 24,422 | $ 16,556 |
Deferred revenue to be recognized thereafter | 8,858 | 9,056 | |
Canadian Defined Contribution Pension Plan [Member] | |||
Defined contribution pension plans [Abstract] | |||
Cash contributions | $ 1,626 | 1,592 | 1,610 |
Canadian Defined Contribution Pension Plan [Member] | Top of Range [Member] | |||
Defined contribution pension plans [Abstract] | |||
Maximum matching percentage of employee's gross pay | 4.00% | ||
US Defined Contribution Pension Plan (401K plan) [Member] | |||
Defined contribution pension plans [Abstract] | |||
Cash contributions | $ 464 | $ 460 | $ 591 |
Percentage of employer contribution to employee | 3.00% | ||
Percentage of participants current compensation | 6.00% | ||
US Defined Contribution Pension Plan (401K plan) [Member] | Top of Range [Member] | |||
Defined contribution pension plans [Abstract] | |||
Percentage of employees additional statutorily prescribed annual limit | 1.00% | ||
Percentage of first 6% of participant's current compensation | 50.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 8 Months Ended | 12 Months Ended | ||||
Aug. 31, 2018 | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | Dec. 31, 2017 | ||
Reconciliation of Income Tax Provision (Recovery) [Abstract] | ||||||
Income tax provision (recovery) at combined Canadian federal and provincial statutory tax rate (27%) | $ (950) | $ 774 | $ (1,775) | |||
Increase (decrease) due to [Abstract] | ||||||
Foreign income/loss taxed at different rates | 540 | 13 | 452 | |||
Non-deductible loss (non-taxable income) | (457) | 10 | (69) | |||
Non-deductible expenses | 697 | 594 | 1,285 | |||
Change in tax rates | 0 | 0 | 167 | |||
Effect of the US tax reform | [1] | 0 | 0 | 1,528 | ||
Foreign exchange effect of translation of foreign subsidiaries in the functional currency | 732 | 63 | (16) | |||
Recognition of previously unrecognized deferred income tax assets | (506) | (2,383) | (560) | |||
Utilization of previously unrecognized deferred income tax assets | (13) | (964) | (627) | |||
Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses | 5,369 | 5,761 | 6,100 | |||
Other | 610 | 1,478 | (807) | |||
Income tax provision for the year | $ 6,022 | $ 5,346 | $ 5,678 | |||
Canada [Member] | ||||||
Applicable Tax Rate [Abstract] | ||||||
Statutory tax rate | 27.00% | 27.00% | 27.00% | |||
US [Member] | ||||||
Applicable Tax Rate [Abstract] | ||||||
Statutory tax rate | 35.00% | |||||
Change In Tax Rates Enacted [Member] | US [Member] | ||||||
Applicable Tax Rate [Abstract] | ||||||
Statutory tax rate | 21.00% | |||||
[1] | On December 22, 2017, the US tax reform ("Tax Cuts and Jobs Act") was substantively enacted and reduces the maximum corporate income tax rate from 35% to 21%, effective January 1, 2018. Based on management's estimate of deferred tax assets expected to be used in fiscal 2018 and beyond against taxable income in the United States, the company recorded a deferred income tax expense of $1,528,000 in the consolidated statement of earnings for the year ended August 31, 2018 to account for the effect of this substantively enacted tax rate. |
Income Taxes, Income Tax Provis
Income Taxes, Income Tax Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Current [Abstract] | |||
Current income taxes | $ 5,365 | $ 7,449 | $ 4,310 |
Deferred [Abstract] | |||
Deferred income taxes relating to the origination and reversal of temporary differences | (4,193) | (4,517) | (3,545) |
Benefit arising from previously unrecognized tax losses and deductible temporary differences | (506) | (2,383) | (560) |
Utilization of previously unrecognized deferred income tax assets | (13) | (964) | (627) |
Total | (4,712) | (7,864) | (4,732) |
Unrecognized deferred income tax assets on temporary deductible differences and unused tax losses | 5,369 | 5,761 | 6,100 |
Deferred income taxes | 657 | (2,103) | 1,368 |
Income tax provision for the year | $ 6,022 | $ 5,346 | $ 5,678 |
Income Taxes, Changes in Deferr
Income Taxes, Changes in Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Aug. 31, 2020 | Aug. 31, 2019 | |
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | $ 1,223 | $ (1,196) |
Credited (charged) to the statement of earnings | (657) | 2,103 |
Credited (charged) to shareholders' equity | (578) | 67 |
Foreign currency translation adjustment | (115) | 249 |
Deferred tax assets (liability), end of year | (127) | 1,223 |
Deferred Income Tax Assets [Member] | Long-Lived Assets [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | 4,568 | 1,925 |
Credited (charged) to the statement of earnings | (804) | 2,695 |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | 71 | (52) |
Deferred tax assets (liability), end of year | 3,835 | 4,568 |
Deferred Income Tax Assets [Member] | Provisions and Accruals [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | 4,491 | 3,963 |
Credited (charged) to the statement of earnings | (387) | 446 |
Credited (charged) to shareholders' equity | (578) | 67 |
Foreign currency translation adjustment | 75 | 15 |
Deferred tax assets (liability), end of year | 3,601 | 4,491 |
Deferred Income Tax Assets [Member] | Deferred Revenue [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | 3,170 | 2,716 |
Credited (charged) to the statement of earnings | 104 | 490 |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | 50 | (36) |
Deferred tax assets (liability), end of year | 3,324 | 3,170 |
Deferred Income Tax Assets [Member] | Research and Development Expenses [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | 2,330 | 2,524 |
Credited (charged) to the statement of earnings | (47) | (149) |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | 44 | (45) |
Deferred tax assets (liability), end of year | 2,327 | 2,330 |
Deferred Income Tax Assets [Member] | Losses Carried Forward [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | 2,146 | 5,073 |
Credited (charged) to the statement of earnings | (616) | (2,751) |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | 7 | (176) |
Deferred tax assets (liability), end of year | 1,537 | 2,146 |
Deferred Income Tax Liabilities [Member] | Long-Lived Assets [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | (4,406) | (6,461) |
Credited (charged) to the statement of earnings | 1,003 | 1,710 |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | (154) | 345 |
Deferred tax assets (liability), end of year | (3,557) | (4,406) |
Deferred Income Tax Liabilities [Member] | Research and Development Tax Credits [Member] | ||
Changes in deferred tax (liability) asset [Abstract] | ||
Deferred tax assets (liability), beginning of year | (11,076) | (10,936) |
Credited (charged) to the statement of earnings | 90 | (338) |
Credited (charged) to shareholders' equity | 0 | 0 |
Foreign currency translation adjustment | (208) | 198 |
Deferred tax assets (liability), end of year | $ (11,194) | $ (11,076) |
Income Taxes, Changes in Defe_2
Income Taxes, Changes in Deferred Income Tax Assets and Liabilities Classified as Follows (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 |
Classified as follows [Abstract] | |||
Deferred income tax assets | $ 3,633 | $ 4,821 | $ 4,714 |
Deferred income tax liabilities | (3,760) | (3,598) | (5,910) |
Deferred income tax assets net | $ (127) | $ 1,223 | $ (1,196) |
Income Taxes, Unrecognized Defe
Income Taxes, Unrecognized Deferred Income Tax Assets on Temporary Deductible Differences and Unused Tax Losses (Details) - USD ($) $ in Thousands | Aug. 31, 2020 | Aug. 31, 2019 |
Unrecognized deferred income tax assets [Abstract] | ||
Unrecognized deferred income tax assets | $ 46,452 | $ 39,962 |
Temporary Deductible Differences [Member] | ||
Unrecognized deferred income tax assets [Abstract] | ||
Unrecognized deferred income tax assets | 163 | 241 |
Losses Carried Forward [Member] | ||
Unrecognized deferred income tax assets [Abstract] | ||
Unrecognized deferred income tax assets | $ 46,289 | $ 39,721 |
Income Taxes, Operating Losses
Income Taxes, Operating Losses for Which no Deferred Income Tax Assets Recognized (Details) $ in Thousands, $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020USD ($) | Aug. 31, 2020CAD ($) | Aug. 31, 2020CAD ($) | |
Research and Development Tax Credits [Abstract] | |||
Non-refundable research and development tax credits | $ 39,252 | ||
Taxable temporary differences | 25,714 | ||
Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 43,164 | ||
France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 58,516 | ||
Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 6,414 | ||
United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 59,460 | ||
United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 8,267 | ||
Canada Federal Level [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Capital losses for which no deferred tax asset recognized | 50,081 | $ 65,311 | |
Research and Development Tax Credits [Abstract] | |||
Pre-tax earnings required for recovery | $ 261 | $ 341 | |
Estimated recovery period for pre-tax earnings | P16Y | P16Y | |
Pre-tax earnings compound annual growth rate | 2.00% | 2.00% | |
Carried forward period | P20Y | P20Y | |
Canada Provincial Level [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Capital losses for which no deferred tax asset recognized | $ 53,436 | $ 69,686 | |
2021 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 6,865 | ||
2021 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2021 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2021 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,074 | ||
2021 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2022 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 11,902 | ||
2022 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2022 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2022 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 7,435 | ||
2022 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2023 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 7,711 | ||
2023 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2023 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2023 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,972 | ||
2023 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2024 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 5,953 | ||
2024 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2024 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2024 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,351 | ||
2024 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2025 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 7,421 | ||
2025 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2025 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2025 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,351 | ||
2025 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2026 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 254 | ||
2026 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2026 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2026 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,351 | ||
2026 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2027 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,542 | ||
2027 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2027 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2027 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,351 | ||
2027 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2028 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2028 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2028 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2028 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 2,447 | ||
2028 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2030 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 1,516 | ||
2030 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2030 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2030 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 2,713 | ||
2030 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2031 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2031 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2031 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2031 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 109 | ||
2031 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2033 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2033 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2033 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2033 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 4,681 | ||
2033 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2034 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2034 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2034 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2034 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 4,851 | ||
2034 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2035 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2035 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2035 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2035 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 2,616 | ||
2035 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2036 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2036 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2036 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2036 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 8,501 | ||
2036 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2037 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2037 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2037 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2037 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 9,660 | ||
2037 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2038 [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2038 [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2038 [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
2038 [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 7,997 | ||
2038 [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
Indefinite [Member] | Finland [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
Indefinite [Member] | France [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 58,516 | ||
Indefinite [Member] | Spain [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 6,414 | ||
Indefinite [Member] | United States [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | 0 | ||
Indefinite [Member] | United Kingdom [Member] | |||
Operating Losses for Which no Deferred Income Tax Assets Recognized [Abstract] | |||
Operating losses for which no deferred tax asset recognized | $ 8,267 |
Earnings per Share (Details)
Earnings per Share (Details) - shares shares in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Earnings per Share [Abstract] | |||
Basic weighted average number of shares outstanding (in shares) | 55,604 | 55,325 | 54,998 |
Plus dilutive effect of [Abstract] | |||
Restricted shares units (in shares) | 0 | 0 | 0 |
Deferred share units (in shares) | 0 | 0 | 0 |
Performance share units (in shares) | 0 | 0 | 0 |
Diluted weighted average number of shares outstanding (in shares) | 55,604 | 55,325 | 54,998 |
Stock awards excluded from the calculation of the diluted weighted average number of shares outstanding because their exercise price was greater than the average market price of the common shares, or their inclusion would be antidilutive (in shares) | 2,012 | 1,701 | 1,799 |
Segment Information, Informatio
Segment Information, Information by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Aug. 31, 2020 | Aug. 31, 2019 | Aug. 31, 2018 | |
Sales to external customers by geographic region [Abstract] | |||
Sales | $ 265,583 | $ 286,890 | $ 269,546 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 39,722 | 39,364 | |
Lease ROU assets | 10,758 | 0 | |
Intangible assets | 17,616 | 21,654 | |
Goodwill | 40,290 | 38,648 | 39,892 |
United States [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 99,595 | 106,607 | 100,225 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 6 | 7 | |
Lease ROU assets | 1,857 | 0 | |
Intangible assets | 0 | 0 | |
Goodwill | 0 | 0 | |
Canada [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 16,508 | 15,913 | 18,425 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 29,801 | 29,517 | |
Lease ROU assets | 0 | 0 | |
Intangible assets | 5,338 | 5,675 | |
Goodwill | 17,827 | 17,487 | |
Other [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 13,379 | 21,391 | 16,743 |
Americas [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 129,482 | 143,911 | 135,393 |
Europe, Middle East and Africa [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 79,870 | 92,723 | 84,677 |
Finland [Member] | |||
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 487 | 331 | |
Lease ROU assets | 153 | 0 | |
Intangible assets | 455 | 446 | |
Goodwill | 8,713 | 8,547 | |
France [Member] | |||
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 2,027 | 1,896 | |
Lease ROU assets | 3,526 | 0 | |
Intangible assets | 9,971 | 12,788 | |
Goodwill | 6,055 | 5,600 | |
United Kingdom [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 16,170 | 16,438 | 17,508 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 488 | 640 | |
Lease ROU assets | 544 | 0 | |
Intangible assets | 1,808 | 2,706 | |
Goodwill | 7,695 | 7,014 | |
Other [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 63,700 | 76,285 | 67,169 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 45 | 57 | |
Lease ROU assets | 402 | 0 | |
Intangible assets | 2 | 0 | |
Goodwill | 0 | 0 | |
India [Member] | |||
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 4,083 | 4,249 | |
Lease ROU assets | 65 | 0 | |
Intangible assets | 18 | 23 | |
Goodwill | 0 | 0 | |
China [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 35,727 | 27,620 | 20,724 |
Long-lived assets by geographical region [Abstract] | |||
Property, plant and equipment | 2,785 | 2,667 | |
Lease ROU assets | 4,211 | 0 | |
Intangible assets | 24 | 16 | |
Goodwill | 0 | 0 | |
Other [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | 20,504 | 22,636 | 28,752 |
Asia Pacific [Member] | |||
Sales to external customers by geographic region [Abstract] | |||
Sales | $ 56,231 | $ 50,256 | $ 49,476 |