Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2019 | Jul. 30, 2019 | |
Document and Entity Information | ||
Entity Registrant Name | LIQUIDITY SERVICES INC | |
Entity Central Index Key | 0001235468 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding (in shares) | 33,651,086 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 36,414 | $ 58,448 |
Short-term investments | 30,000 | 20,000 |
Accounts receivable, net of allowance for doubtful accounts of $347 and $337 at June 30, 2019 and September 30, 2018, respectively | 5,742 | 4,870 |
Inventory, net | 8,891 | 10,122 |
Prepaid taxes and tax refund receivable | 1,673 | 1,727 |
Prepaid expenses and other current assets | 8,129 | 7,816 |
Total current assets | 90,849 | 102,983 |
Property and equipment, net of accumulated depreciation of $13,254 and $11,078 at June 30, 2019 and September 30, 2018, respectively | 18,589 | 16,610 |
Intangible assets, net | 6,377 | 7,366 |
Goodwill | 59,685 | 59,819 |
Deferred tax assets | 869 | 930 |
Other assets | 14,299 | 14,124 |
Total assets | 190,668 | 201,832 |
Current liabilities: | ||
Accounts payable | 13,289 | 13,859 |
Accrued expenses and other current liabilities | 24,390 | 21,373 |
Distributions payable | 1,827 | 2,128 |
Deferred revenue | 3,185 | 2,142 |
Payables to sellers | 24,840 | 28,969 |
Total current liabilities | 67,531 | 68,471 |
Deferred taxes and other long-term liabilities | 2,024 | 3,707 |
Total liabilities | 69,555 | 72,178 |
Commitments and contingencies (Note 12) | 0 | 0 |
Stockholders’ equity: | ||
Common stock, $0.001 par value; 120,000,000 shares authorized; 33,498,078 shares issued and outstanding at June 30, 2019; 32,774,118 shares issued and outstanding at September 30, 2018 | 33 | 33 |
Additional paid-in capital | 241,361 | 236,115 |
Accumulated other comprehensive loss | (6,933) | (6,449) |
Accumulated deficit | (113,348) | (100,045) |
Total stockholders’ equity | 121,113 | 129,654 |
Total liabilities and stockholders’ equity | $ 190,668 | $ 201,832 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 347 | $ 337 |
Property and equipment, accumulated depreciation | $ 13,254 | $ 11,078 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 33,498,078 | 32,774,118 |
Common stock, shares outstanding (in shares) | 33,498,078 | 32,774,118 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Total revenue | $ 56,882 | $ 50,569 | $ 167,735 | $ 171,809 |
Costs and expenses from operations: | ||||
Cost of goods sold (exclusive of depreciation and amortization) | 25,337 | 19,489 | 75,100 | 75,847 |
Seller distributions | 2,994 | 3,936 | 8,393 | 11,107 |
Technology and operations | 12,145 | 13,663 | 38,098 | 47,718 |
Sales and marketing | 8,771 | 8,386 | 26,887 | 24,921 |
General and administrative | 8,959 | 6,847 | 26,217 | 22,056 |
Depreciation and amortization | 1,206 | 1,020 | 3,575 | 3,375 |
Other operating expenses | 2,031 | 452 | 3,586 | 2,222 |
Total costs and expenses | 61,443 | 53,793 | 181,856 | 187,246 |
Loss from operations | (4,561) | (3,224) | (14,121) | (15,437) |
Interest and other income, net | (454) | (131) | (1,224) | (1,041) |
Loss before provision (benefit) for income taxes | (4,107) | (3,093) | (12,897) | (14,396) |
Provision (benefit) for income taxes | 542 | 612 | 1,136 | (3,824) |
Net loss | $ (4,649) | $ (3,705) | $ (14,033) | $ (10,572) |
Basic and diluted loss per common share (in dollars per share) | $ (0.14) | $ (0.12) | $ (0.43) | $ (0.33) |
Basic and diluted weighted average shares outstanding (in shares) | 33,164,750 | 32,104,368 | 32,986,040 | 31,984,222 |
Revenue | ||||
Total revenue | $ 36,388 | $ 32,080 | $ 109,478 | $ 115,464 |
Fee revenue | ||||
Total revenue | $ 20,494 | $ 18,489 | $ 58,257 | $ 56,345 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (4,649) | $ (3,705) | $ (14,033) | $ (10,572) |
Other comprehensive income (loss): | ||||
Foreign currency translation | (255) | (748) | (484) | (764) |
Other comprehensive income (loss) | (255) | (748) | (484) | (764) |
Comprehensive loss | $ (4,904) | $ (4,453) | $ (14,517) | $ (11,336) |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Balance (in shares) at Sep. 30, 2017 | 31,503,349 | ||||
Balance at Sep. 30, 2017 | $ 132,636 | $ 29 | $ 227,264 | $ (6,431) | $ (88,226) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (1,212) | (1,212) | |||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 386,330 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 0 | $ 0 | |||
Balance (in shares) at Dec. 31, 2017 | 31,889,679 | ||||
Balance at Dec. 31, 2017 | 132,522 | $ 29 | 228,626 | (6,482) | (89,651) |
Balance (in shares) at Sep. 30, 2017 | 31,503,349 | ||||
Balance at Sep. 30, 2017 | 132,636 | $ 29 | 227,264 | (6,431) | (88,226) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (10,572) | ||||
Foreign currency translation | (764) | ||||
Balance (in shares) at Jun. 30, 2018 | 32,109,731 | ||||
Balance at Jun. 30, 2018 | 125,321 | $ 29 | 231,327 | (7,195) | (98,840) |
Balance (in shares) at Dec. 31, 2017 | 31,889,679 | ||||
Balance at Dec. 31, 2017 | 132,522 | $ 29 | 228,626 | (6,482) | (89,651) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (5,655) | (5,655) | |||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 103,398 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 12 | $ 0 | 12 | ||
Balance (in shares) at Mar. 31, 2018 | 31,993,077 | ||||
Balance at Mar. 31, 2018 | 128,137 | $ 29 | 229,850 | (6,448) | (95,294) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (3,705) | (3,705) | |||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 116,654 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 0 | $ 0 | |||
Foreign currency translation | (748) | ||||
Balance (in shares) at Jun. 30, 2018 | 32,109,731 | ||||
Balance at Jun. 30, 2018 | 125,321 | $ 29 | 231,327 | (7,195) | (98,840) |
Balance (in shares) at Sep. 30, 2018 | 32,774,118 | ||||
Balance at Sep. 30, 2018 | 129,654 | $ 33 | 236,115 | (6,449) | (100,045) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (5,022) | (5,022) | |||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 409,060 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 8 | $ 0 | 8 | ||
Compensation expense from grants of common stock options and restricted stock | 1,556 | 1,556 | |||
Foreign currency translation | (427) | (427) | |||
Balance (in shares) at Dec. 31, 2018 | 33,183,178 | ||||
Balance at Dec. 31, 2018 | 126,499 | $ 33 | 237,679 | (6,876) | (104,337) |
Balance (in shares) at Sep. 30, 2018 | 32,774,118 | ||||
Balance at Sep. 30, 2018 | 129,654 | $ 33 | 236,115 | (6,449) | (100,045) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (14,033) | ||||
Foreign currency translation | (484) | ||||
Balance (in shares) at Jun. 30, 2019 | 33,498,078 | ||||
Balance at Jun. 30, 2019 | 121,113 | $ 33 | 241,361 | (6,933) | (113,348) |
Balance (in shares) at Dec. 31, 2018 | 33,183,178 | ||||
Balance at Dec. 31, 2018 | 126,499 | $ 33 | 237,679 | (6,876) | (104,337) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (4,362) | (4,362) | |||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 197,642 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 116 | $ 0 | 116 | ||
Compensation expense from grants of common stock options and restricted stock | 2,011 | 2,011 | |||
Forfeiture of restricted stock awards (in shares) | (33,163) | ||||
Forfeiture of restricted stock awards | $ 0 | ||||
Foreign currency translation and other | 201 | 198 | 3 | ||
Balance (in shares) at Mar. 31, 2019 | 33,347,657 | ||||
Balance at Mar. 31, 2019 | 124,465 | $ 33 | 239,806 | (6,678) | (108,696) |
Increase (Decrease) in Stockholders' Equity | |||||
Net loss | (4,649) | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units (in shares) | 150,421 | ||||
Exercise of common stock options, grants of restricted stock awards, and vesting of restricted stock units | 5 | $ 0 | 5 | ||
Compensation expense from grants of common stock options and restricted stock | 1,550 | 1,550 | |||
Foreign currency translation | (255) | ||||
Foreign currency translation and other | (258) | (255) | (3) | ||
Balance (in shares) at Jun. 30, 2019 | 33,498,078 | ||||
Balance at Jun. 30, 2019 | $ 121,113 | $ 33 | $ 241,361 | $ (6,933) | $ (113,348) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating activities | ||
Net loss | $ (14,033) | $ (10,572) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 3,575 | 3,375 |
Stock compensation expense | 4,134 | |
Provision for inventory allowance | 0 | 2,092 |
Provision for doubtful accounts | 184 | 191 |
Deferred tax provision (benefit) | 81 | (4,814) |
Gain on disposal of property and equipment | 20 | (489) |
Change in fair value of financial instruments | 0 | 90 |
Change in fair value of earnout liability | 2,300 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,056) | 5,551 |
Inventory | 1,231 | 5,847 |
Prepaid and deferred taxes | 47 | 197 |
Prepaid expenses and other assets | 244 | 1,938 |
Accounts payable | (570) | 3,165 |
Accrued expenses and other current liabilities | (777) | (12,149) |
Distributions payable | (301) | (842) |
Deferred revenue | 1,043 | 0 |
Payables to sellers | (4,129) | 4,542 |
Other liabilities | (222) | (664) |
Net cash (used in) provided by operating activities | (7,225) | 1,592 |
Investing activities | ||
Increase in intangibles | (20) | (23) |
Purchases of property and equipment, including capitalized software | (4,784) | (2,697) |
Proceeds from sales of property and equipment | 112 | 828 |
Purchases of short-term investments | (50,000) | (10,000) |
Maturities of short-term investments | 40,000 | 0 |
Net cash used in investing activities | (14,692) | (11,892) |
Financing activities | ||
Proceeds from exercise of common stock options | 129 | 12 |
Net cash provided by financing activities | 129 | 12 |
Effect of exchange rate differences on cash and cash equivalents | (246) | (649) |
Net (decrease) increase in cash and cash equivalents | (22,034) | (10,937) |
Cash and cash equivalents at beginning of period | 58,448 | 94,348 |
Cash and cash equivalents at end of period | 36,414 | 83,411 |
Supplemental disclosure of cash flow information | ||
Cash paid for income taxes, net | $ 872 | $ 800 |
Organization
Organization | 9 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Liquidity Services, Inc. (the Company) operates a network of ecommerce marketplaces that enable Buyers and Sellers to transact in an efficient, automated environment offering over 500 product categories. The Company’s marketplaces provide professional Buyers access to a global, organized supply of new, surplus and scrap assets presented with digital images and other relevant product information. Additionally, the Company enables corporate and government Sellers to enhance their financial return on offered assets by providing a liquid marketplace and value-added services that encompass the consultative management, valuation and sale of surplus assets. The Company provides a broad range of fully-managed service offerings that include program management, valuation, asset management, reconciliation, returns process management, refurbishment and recycling, fulfillment, marketing and sales, warehousing and transportation, Buyer support, compliance and risk mitigation, as well as self-directed service offerings. The Company organizes the products on its marketplaces into categories across major industry verticals such as consumer electronics, general merchandise, apparel, scientific equipment, aerospace parts and equipment, technology hardware, energy equipment, industrial capital assets, fleet and transportation equipment and specialty equipment. The Company’s marketplaces are: www.liquidation.com, www.direct.liquidation.com, www.govdeals.com, www.networkintl.com, www.secondipity.com, www.go-dove.com, and www.auctiondeals.com. The Company also operates a global search engine for listing used machinery and equipment for sale at www.machinio.com. The Company has four reportable segments: Retail Supply Chain Group (RSCG), Capital Assets Group (CAG), GovDeals and Machinio. See Note 13 in the Notes to the Consolidated Financial Statements for Segment Information. On July 10, 2018, the Company acquired 100% of Machinio Corp. (Machinio), a privately-owned company based in Chicago, Illinois, with a second office in Berlin, Germany. Machinio operates a global online platform for listing used equipment for sale in the construction, machine tool, transportation, printing and agriculture sectors. The consideration paid to the sellers was $16.7 million in net cash, equity consideration of $2.0 million , and contingent consideration payable in 2020 in an amount up to $5.0 million . The Company's operations are subject to certain risks and uncertainties, many of which are associated with technology-oriented companies, including, but not limited to, the Company's dependence on use of the Internet, the effect of general business and economic trends, the Company's susceptibility to rapid technological change, actual and potential competition by entities with greater financial and other resources, and the potential for the commercial Sellers from which the Company derives a significant portion of its inventory to change the way they conduct their disposition of surplus assets or to otherwise terminate or not renew their contracts with the Company. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Unaudited Interim Financial Information The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal, recurring adjustments considered necessary for a fair presentation, have been included. The information disclosed in the notes to the consolidated financial statements for these periods is unaudited. Operating results for the three and nine months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending September 30, 2019 or for any future period. Revenue Recognition In the Consolidated Statements of Operations, revenue from the resale of inventory that the Company purchases from Sellers is recognized within Revenue. Commission fees from the sale of inventory that the Company sells on a consignment basis and other non-consignment fee revenue, which is made up of subscription fee and service revenue from the Surplus Contract (defined below) in the prior year, is recognized within Fee Revenue. The Company adopted the Financial Accounting Standard Board's (FASB) Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (ASC 606) effective October 1, 2018. As a result of adopting ASC 606, there have been significant changes to the Company's revenue recognition policy from the policy disclosed in Note 2 -Summary of Significant Accounting Polices in the Company’s Annual Report on Form 10-K for the year ended September 30, 2018 . These changes are described below. The Company recognizes revenue when or as performance obligations are satisfied and control is transferred to the customer. Revenue is recognized in the amount that reflects the consideration to which the Company expects to be entitled. Revenue is also evaluated to determine whether the Company should report the gross proceeds as revenue, when the Company acts as the principal in the arrangement, or the Company should report its revenue on a net basis, when the Company acts as an agent. Specifically, when other parties are involved in providing goods or services to a customer, the Company must determine whether the nature of its promise is a performance obligation to provide the specified goods or services itself, or to arrange for another party to provide them. The Company evaluates the following factors to determine if it is acting as a principal: (1) whether the Company is primarily responsible for fulfilling the promise to provide the asset or assets; (2) whether the Company has inventory risk of the asset or assets before they are transferred to the Buyer; and (3) whether the Company has discretion in establishing the price for the asset or assets. The Company enters into contracts with Buyers and Sellers. The Company has master agreements with some Sellers pertaining to the sale of a flow of surplus assets over the term of the master agreement, however; a contract for accounting purposes exists when the Company agrees to sell a specific asset or assets. When acting as a principal (a “purchase” arrangement), the Company purchases an asset or assets from a Seller and then the Company seeks to sell the asset or assets to a Buyer. The Company recognizes as Revenue the gross proceeds from the sale, including Buyer's premiums. In purchase arrangements, the contract with the Seller is not a contract in the scope of the revenue recognition guidance; rather, it is a purchase of inventory. When the Company is acting as an agent (a “consignment” arrangement), its performance obligation is to arrange for the Seller to sell an asset or assets to the Buyer directly. The Company recognizes Fee Revenue based on the sales commissions that are paid to the Company by the Sellers for utilizing the Company's services; in this situation, sales commissions represent a percentage of the gross proceeds from the sale that the Seller pays to the Company upon completion of the transaction. In both purchase and consignment contracts, the Company sometimes provides distinct services to the Seller, such as returns management or refurbishment of assets. These services are distinct because the Seller could benefit from the services separately from the asset sale, and as such they are treated as separate performance obligations. Some services provided to Sellers are not distinct, like providing access to the Company’s e-commerce marketplaces or promoting the asset or assets for sale, because they could not benefit the Seller separately from the sale of the asset or assets. The consideration received from Buyers and Sellers includes (1) Buyer’s premiums, (2) Seller’s commissions, and (3) fees for services, including reimbursed expenses. Consideration is variable based on units, final auction prices, or other factors, until the Buyer’s purchase of the asset or assets is complete, or the service has been provided. Recognition of variable consideration that is based on the results of auctions or purchases by Buyers is constrained until those transactions have been finalized. The Company estimates and recognizes amounts related to sales returns, discounts or rebates promised to customers, and reimbursed expenses. The total transaction price is allocated to each distinct performance obligation and revenue is recognized when or as the performance obligation is satisfied. Variable consideration is allocated to individual performance obligations when the variable consideration is related to satisfying that performance obligation and consistent with the allocation objective. The Company's revenue is generally recorded subsequent to receipt of payment authorization, utilizing credit cards, wire transfers and PayPal, an Internet-based payment system, as methods of payments. Goods are generally not shipped before payment is received. For certain transactions, payment is due upon invoice and the payment terms vary depending on the business segment. The Company collects and remits sales taxes on merchandise that it purchases and sells and has elected the practical expedient to report such amounts under the net method in its Consolidated Statements of Operations. The Company also provides shipping and handling services in some arrangements and has elected the practical expedient to treat those activities as a fulfillment cost. If the Company is acting as a principal for the combined obligation, amounts received from customers for shipping are recognized as Revenue, and amounts paid for shipping are recognized as costs of goods sold. If the Company is acting as an agent for the combined obligation, shipping revenue and costs will be netted and recognized within costs of goods sold. The Company’s performance obligations are satisfied when control of the asset is transferred to the Buyer or when the service is completed. The Company determines when control has transferred by evaluating the following five indicators: (1) whether the Company has a present right to payment for the asset or assets; (2) whether the Buyer has legal title to the asset; (3) whether the Buyer has physical possession of the asset or assets; (4) whether the Buyer has the significant risks and rewards of ownership; and (5) whether the Buyer has accepted the asset or assets. For the Company's Machinio business segment, the performance obligation is satisfied over time as the Company provides the sales listing services over the term of the subscription. At June 30, 2019 , the Machinio business segment had a remaining performance obligation of $3.2 million ; the Company expects to recognize the substantial majority of that amount as Fee Revenue over the next 12 months. Cost of Goods Sold Cost of goods sold includes the costs of purchasing and transporting property for auction, credit card transaction fees and shipping and handling costs. The Company purchases the majority of its inventory at a percentage of the vendor's last retail price under certain commercial contracts within its RSCG segment, and at specifically negotiated prices within its CAG segment. Title for the inventory passes to the Company at the time of purchase and the Company bears the risks and rewards of ownership. The Company does not have title to assets sold on behalf of its commercial or government Sellers when it receives only sales commission revenue and, as such, recognizes no inventory or the corresponding cost of goods sold from inventory purchases associated with those sales. Contract Assets and Liabilities Contract assets reflect an estimate of expenses that will be reimbursed upon settlement with a Seller. The contract asset balance was $0.7 million as of October 1, 2018 and $0.4 million as of June 30, 2019 and is included in the line item Prepaid expenses and other current assets on the consolidated balance sheets. Contract liabilities reflect obligations to provide services for which the Company has already received consideration, and generally arise from up-front payments received in connection with Machinio's subscription services. The contract liability balance was $2.1 million as of October 1, 2018, and $3.2 million as of June 30, 2019 and is included in the line item Deferred revenue on the consolidated balance sheets. Of the October 1, 2018 contract liability balance, $1.9 million was earned as Fee Revenue during the nine months ended June 30, 2019 . Contract Costs Contract costs relate to sales commissions paid on consignment contracts that are capitalized. Contract costs are amortized over the expected life of the customer contract. The contract cost balance was $0.1 million as of October 1, 2018 and $0.4 million as of June 30, 2019 and is included in the line item Prepaid expenses and other current assets and Other assets on the consolidated balance sheet. Amortization expense was immaterial during the three and nine months ended June 30, 2019 . Promissory Note On September 30, 2015, the Company sold certain assets related to its Jacobs Trading business to Tanager Acquisitions, LLC (Tanager). In connection with the disposition, Tanager assumed certain liabilities related to the Jacobs Trading business. Tanager issued a $12.3 million five -year interest-bearing promissory note to the Company, with principal payments due annually on each September 30. Of the $12.3 million , $4.0 million has been repaid as of June 30, 2019 . Of the remaining $8.3 million , $6.3 million is recorded on the consolidated balance sheet in Other assets, and $2.0 million in Prepaid expenses and other current assets as of June 30, 2019 based on the scheduled repayment dates. Risk Associated with Certain Concentrations The Company does not perform credit evaluations for the majority of its Buyers. However, most sales are recorded subsequent to payment authorization being received. As a result, the Company is not subject to significant collection risk, as most goods are not shipped before payment is received. For consignment sales transactions, funds are typically collected from Buyers and are held by the Company on the Sellers' behalf. The funds are included in Cash and cash equivalents in the Consolidated Balance Sheets. The Company releases the funds to the Seller, less the Company's commission and other fees due, after the Buyer has accepted the goods or within 30 days, depending on the state where the Buyer and Seller conduct business. The amount of cash held on behalf of Sellers is recorded within Payables to sellers on the consolidated balance sheets. Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash in banks over FDIC limits, certificates of deposit, and accounts receivable. The Company deposits its cash with financial institutions that the Company considers to be of high credit quality. During the nine months ended June 30, 2019 , the Company had one material vendor contract with the Department of Defense (DoD) under which it acquired, managed and sold government property: the Scrap Contract. Revenue from the sale of property acquired under the Scrap Contract accounted for 8.2% and 12.1% of the Company's consolidated revenue for the three months ended June 30, 2019 and 2018 , respectively, and for 7.8% and 10.0% of the Company's consolidated revenue for the nine months ended June 30, 2019 and 2018 , respectively. This contract is included within the Company's CAG segment. On June 10, 2019, the DoD informed the Company that the option periods in the Scrap Contract would not be exercised and instructed the Company to commence the phase-out period as of that date. The Scrap Contract will conclude on September 30, 2019. See Note 3, Significant Contracts, for information related to the Company's prior significant Surplus Contact with the DoD, which was wound down in fiscal 2018. Additionally, the Company has a vendor contract with Amazon.com, Inc. under which the Company acquires and sells commercial merchandise. Transactions under this contract represented 41.6% and 41.0% of cost of goods sold for the three months ended June 30, 2019 and 2018 , respectively, and 43.9% and 28.5% of cost of goods sold for the nine months ended June 30, 2019 and 2018 , respectively. This contract is included within the Company's RSCG segment. Earnings per Share The Company calculates net income (loss) per share in accordance with FASB Topic 260 Earnings Per Share (ASC 260). Under ASC 260, basic net income (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares of common stock outstanding includes vested restricted stock units. Diluted net income (loss) per share reflects the potential dilution that could occur assuming conversion or exercise of all dilutive unexercised stock options and unvested restricted stock units. The dilutive effect of unexercised stock options and unvested restricted stock units was determined using the treasury stock method. Under the treasury stock method, the proceeds received from the exercise of stock options and the amount of compensation cost for future service not yet recognized by the Company are assumed to be used to repurchase shares of the Company’s common stock. Stock options and restricted stock units are not included in the computation of diluted net income (loss) per share when they are antidilutive. For the three and nine months ended June 30, 2019 and 2018 , the basic and diluted weighted average common shares were the same because the inclusion of dilutive securities in the computation of diluted net income would have been anti-dilutive. See Note 7 for the amounts of outstanding stock options, restricted stock awards and restricted stock units that could potentially dilute net income (loss) per share in the future. Recent Accounting Pronouncements Accounting Standards Adopted On October 1, 2018, the Company adopted ASC 606 using the modified retrospective transition method. The Company applied the new revenue standard to all contracts that were not completed as of October 1, 2018 on a modified retrospective basis and recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings. The comparative period information has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effect of the changes made to the consolidated October 1, 2018 balance sheet for the adoption of ASC 606 was as follows (in thousands): Balance at September 30, 2018 Adjustment due to adoption of ASC 606 Balance as adjusted at October 1, 2018 Prepaid expenses and other current assets $ 7,816 $ 671 $ 8,487 Other assets $ 14,124 $ 59 $ 14,183 Retained earnings $ (100,045 ) $ 730 $ (99,315 ) The impact of adopting ASC 606 on the Company’s consolidated statement of operations and the consolidated balance sheet for the period ended June 30, 2019 was as follows (in thousands): Three months ended June 30, 2019 Nine months ended June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated statement of operations: Fee revenue $ 20,494 $ 20,801 $ (307 ) $ 58,257 $ 58,558 $ (301 ) June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated balance sheet: Prepaid expenses and other current assets $ 8,129 $ 7,603 $ 526 Other assets $ 14,299 $ 14,026 $ 273 Accumulated deficit $ (113,348 ) $ (112,549 ) $ (799 ) In May 2017, the FASB issued ASU 2017-09, Scope of Modification Accounting . ASU 2017-09 provides guidance about which changes to terms or conditions of share-based payment awards require the application of modification accounting in Topic 718, Compensation - Stock Compensation . The ASU was adopted on October 1, 2018 and the Company will apply the guidance in ASU 2017-09 on a prospective basis to its award modifications. The adoption of this ASU has not had a material impact on the Company's consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . ASU 2017-07 changes how employers that sponsor defined benefit pension and/or other postretirement benefit plans present the cost of the benefits in the income statement. Under this standard, employers will present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Employers will present the other components of the net periodic benefit cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. The adoption of ASU 2017-07 on October 1, 2018, using the retrospective method, did not have a material impact on the Company's consolidated financial statements. As a result of adopting this standard $84 thousand and $265 thousand for three and nine months ended June 30, 2018 , respectively, were reclassified in the consolidated statement of operations from General and administrative, a component of loss from operations, to Interest and other income, net, which is outside of loss from operations. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business . ASU 2017-01 clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill and consolidation. The ASU was adopted on October 1, 2018 and the Company will apply the guidance on a prospective basis when entering into acquisitions of assets or businesses. The adoption of this ASU has not had a material impact on the Company's consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory . The ASU requires companies to recognize the income tax effects of intercompany sales or transfers of assets, other than inventory, in the income statement as income tax expense (or benefit) in the period the sale or transfer occurs. The exception to recognizing the income tax effects of intercompany sales or transfers of assets remains in place for intercompany inventory sales and transfers. The adoption of the ASU on October 1, 2018 did not have a material impact on the Company’s consolidated statement of operations. In 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments and ASU 2016-18, Restricted Cash . These ASUs clarify how entities should classify certain cash receipts and cash payments on the statement of cash flows and requires that the statement of cash flows explain the change during the period in the total cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. These standards were adopted on October 1, 2018 on a retrospective basis and there was no impact on the Company's consolidated statement of cash flows. Accounting Standards Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirement for capitalizing implementation costs incurred to develop or obtain internal-use software. This ASU will become effective for the Company beginning October 1, 2020. The Company is currently evaluating the effect that the adoption of this ASU may have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans . The ASU amends the existing accounting standard for defined benefit plans by removing, modifying, and adding certain disclosures, and will become effective for the Company beginning October 1, 2021 with early adoption permitted. The Company has evaluated the potential impact of this ASU on its Defined Benefit Pension Plan disclosures. The primary impact of this ASU relates to the disclosure of significant gains and losses resulting from changes in the benefit obligation or plan assets during the period. If significant changes are noted, and they result from changes that are not otherwise apparent from the other required disclosures (e.g. changes resulting from discount rates are already required to be disclosed), the Company will provide qualitative explanations for those changes. The Company plans to early adopt this ASU in its annual financial statements for the year-ended September 30, 2019. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurements . The ASU amends the existing accounting standard for fair value measurement by removing, modifying, and adding certain disclosures, and will become effective for the Company beginning October 1, 2020 with early adoption permitted. The Company has evaluated the potential impact of this ASU on its Fair Value Measurement disclosures. The primary impact of this ASU is a clarification that the measurement uncertainty disclosure related to Level 3 inputs is intended to communicate information about such uncertainty as of the reporting date, rather than sensitivity to potential future changes in those inputs. The Company plans to early adopt this ASU in its annual financial statements for the year-ended September 30, 2019. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-based Payment Accounting. The ASU amends the existing accounting standards for share-based payments to nonemployees, and applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in its own operation by issuing share-based payment awards. Additionally, the ASU clarifies that Topic 718 does not apply to share-based payments used to effectively provide financing to the issuer or awards granted in conjunction with selling goods or services to customers as part of a contract accounted under ASC 606. The ASU will become effective for the Company beginning October 1, 2019. As of June 30, 2019, the only nonemployees that have received awards are the nonemployee members of the Company's Board of Directors. However, as these awards represent compensation solely for their roles as Directors, the Directors are considered to be employees under Topic 718. As a result, no impact is expected from the adoption of this ASU. In February 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The ASU allows entities to elect to classify from accumulated other comprehensive income (loss) to retained earnings stranded tax effects resulting from the Tax Cuts and Jobs Act (the "Tax Act") enacted on December 22, 2017. An entity that does not elect to reclassify the income tax effects of the Tax Act shall disclose in the period of adoption a statement that the election was not made. The ASU will become effective for the Company beginning on October 1, 2019. The Company is currently evaluating whether it will elect to reclassify the income tax effects of the Tax Act from accumulated other comprehensive income to retained earnings. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment . The ASU requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity is required to recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity is required to consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. This guidance will become effective for the Company beginning on October 1, 2020. The Company plans to early adopt this ASU and apply it to the Company's annual impairment assessment to be performed in its fiscal fourth quarter of 2019. An impact of adoption will only be noted to the extent that the annual impairment assessment results in a reporting unit whose carrying amount exceeds its fair value. In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326) , or ASC 326. ASC 326, including all amendments and related guidance, was designed to provide financial statement users with more useful information about the expected credit losses on financial instruments and other commitments to extend credit. ASC 326 will require estimation of expected credit losses using a methodology that takes into consideration a broad range of reasonable and supportable information. The guidance will be effective for the Company beginning on October 1, 2020, and will be applied on a modified-retrospective basis, with any cumulative-effect adjustment recorded to retained earnings on the adoption date. The Company is in the process of evaluating the impact ASC 326 will have on its consolidated financial statements and expects to estimate credit losses on its financial assets such as its Accounts Receivable, Short-term Investments, and Promissory Note. While the Company has not experienced significant credit losses historically, the materiality of the impact of adoption will depend on events and conditions as of the date of adoption, which cannot be determined conclusively at this time. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , or ASC 842. ASC 842, including all amendments and related guidance, will change the way the Company recognizes its leased assets. It will require organizations that lease assets—referred to as "lessees"—to recognize on the balance sheet the assets and liabilities representing the rights and obligations created by those leases. ASC 842 will also require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The guidance will be effective for the Company beginning on October 1, 2019. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into, after either the adoption date or the beginning of the earliest comparative period presented in the financial statements. The Company is in the process of aggregating its worldwide lease portfolio, and has identified a software solution to use in its adoption of ASC 842 and for its subsequent lease accounting requirements. In its adoption of ASU 842, the Company will not adjust its comparative periods. In addition, the Company will elect to use the package of practical expedients offered by ASC 842, which will permit the Company to not reassess whether a contract is or contains a lease, lease classification, or initial direct costs. The Company will not apply hindsight when determining the lease term. For all of its asset classes, the Company will account for both lease and nonlease components as a single component and account for it as a lease, and the Company will not recognize right-of-use assets or lease liabilities for its short-term leases. The Company will use incremental borrowing rates that are consistent with the lease term determined at the lease's commencement. The adoption of ASC 842 will result in the recognition of right-of-use assets and lease liabilities on the Company's consolidated balance sheets, and will require the Company to make quantitative and qualitative disclosures about its leases. Additional impacts, which may be material, may be identified as the Company completes its adoption process. |
Significant Contracts
Significant Contracts | 9 Months Ended |
Jun. 30, 2019 | |
Contractors [Abstract] | |
Significant Contracts | Significant Contracts Historically, the Company had two material vendor contracts with the DoD: the Scrap Contract and the Surplus Contract. Under the Scrap Contract, the Company is the remarketer of all DoD non-electronic scrap turned into the Defense Logistics Agency (DLA) available for sale within the United States, Puerto Rico, and Guam. The current Scrap Contract was awarded to the Company in April 2016. The Scrap Contract has a 36 -month base term that commenced in the first quarter of fiscal year 2017, with two 12 -month extension options exercisable by the DLA. The Company pays a revenue-sharing payment to the DLA under this contract equal to 64.5% of the gross resale proceeds of the scrap property, and the Company bears all of the costs for the sorting, merchandising and sale of the property. On June 10, 2019, the DoD informed the Company that the option periods in the Scrap Contract would not be exercised and instructed the Company to commence the phase-out period as of that date. The Scrap Contract will conclude on September 30, 2019. Revenue from the Scrap Contract accounted for 8.2% and 12.1% of the Company's consolidated revenue for the three months ended June 30, 2019 and 2018 , respectively, and 7.8% and 10.0% of the Company's consolidated revenue for the nine months ended June 30, 2019 and 2018 , respectively. The Surplus Contract was a competitive-bid contract under which the Company acquired, managed and sold usable DoD surplus personal property turned into the DLA. Surplus property generally consisted of items determined by the DoD to be no longer needed and not claimed for reuse by any federal agency, such as electronics, industrial equipment, office supplies, scientific and medical equipment, aircraft parts, clothing and textiles. The Surplus Contract required the Company to purchase all usable surplus property offered to the Company by the DoD at 4.35% of the DoD's original acquisition value. On October 11, 2017, the DLA published a Request for Technical Proposal (RFTP) and draft Invitation for Bid (IFB) for the sale of surplus, useable non-rolling stock property. The RFTP and IFB related to the DLA’s award of two new term surplus contracts. On December 5, 2017, the DLA determined that the Company was not the high bidder for either of the two contracts. The Company made its final inventory purchase under the Surplus Contract during December 2017, and as of June 30, 2018, had completed its wind-down of operations under the Surplus Contract. Revenue from the Surplus Contract accounted for zero and 0.2% of the Company's consolidated revenue for the three months ended June 30, 2019 and 2018 , respectively, and zero and 16.2% of the Company's consolidated revenue for the nine months ended June 30, 2019 and 2018 , respectively. |
Goodwill
Goodwill | 9 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill The goodwill of acquired companies is primarily related to the acquisition of an experienced and knowledgeable workforce. The following table presents changes in the carrying amount of goodwill by reportable segment: Goodwill (in thousands) CAG GovDeals Machinio Total Balance at September 30, 2017 $ 21,657 $ 23,731 $ — $ 45,388 Business acquisition — — 14,558 14,558 Translation adjustments (127 ) — — (127 ) Balance at September 30, 2018 $ 21,530 $ 23,731 $ 14,558 $ 59,819 Translation adjustments (134 ) — — (134 ) Balance at June 30, 2019 $ 21,396 $ 23,731 $ 14,558 $ 59,685 Goodwill is tested for impairment at the beginning of the fourth quarter and during interim periods whenever events or circumstances indicate that the carrying value may not be recoverable. The Company did not identify any indicators of impairment that required performing a step one evaluation during the nine months ended June 30, 2019 . |
Intangible Assets
Intangible Assets | 9 Months Ended |
Jun. 30, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Intangible Assets | Intangible Assets The components of identifiable intangible assets as of June 30, 2019 and September 30, 2018 are as follows: June 30, 2019 September 30, 2018 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (dollars in thousands) Contract intangibles 6 $ 3,100 $ (516 ) $ 2,584 $ 3,100 $ (129 ) $ 2,971 Technology 5 2,700 (540 ) 2,160 2,700 (135 ) 2,565 Patent and trademarks 3 - 10 2,346 (713 ) 1,633 2,269 (439 ) 1,830 Total intangible assets $ 8,146 $ (1,769 ) $ 6,377 $ 8,069 $ (703 ) $ 7,366 Future expected amortization of intangible assets at June 30, 2019 is as follows: Future Amortization Years ending September 30, (in thousands) Remaining three months of 2019 $ 336 2020 1,342 2021 1,334 2022 1,321 2023 1,177 2024 and thereafter 867 Total $ 6,377 Intangible assets amortization expense was $336 thousand and $20 thousand for the three months ended June 30, 2019 and 2018 , and $1.01 million and $100 thousand for the nine months ended June 30, 2019 and 2018 , respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Act was signed into law. The Tax Act reduced the corporate tax rate from 35% to 21% . During the three months ending December 31, 2017, the Company revised its estimated annual effective tax rate to reflect this change in the statutory rate. The rate change was administratively effective at the beginning of the Company's 2018 fiscal year, using a blended rate of 24.5% . At September 30, 2018, the Company had not yet completed its accounting for the tax effects of the Tax Act; however, the Company recorded a provisional benefit of $10.7 million in 2018 for the remeasurement of its deferred tax balance and recognition of the realizability of its deferred tax assets. During the three months ended December 31, 2018, the Company completed its accounting for the tax effects of the Tax Act and determined no change to the amount recorded in fiscal year 2018 was required. The international provisions of the Tax Act establish a territorial tax system and subject certain foreign earnings on which U.S. tax is currently deferred to a one-time transition tax. During the three months ended December 31, 2018, the Company completed its analysis of foreign earnings and profits and determined that no one-time transition tax was due. As a result, the Company has not recorded any amount in its financial statements for fiscal year 2018 or the nine months ended June 30, 2019 for such transition tax. The Tax Act subjects a U.S. shareholder to a minimum tax on “global intangible low-taxed income” (“GILTI”) earned by certain foreign subsidiaries. The FASB Staff Q&A, Topic 740 No. 5, Accounting for Global Intangible Low-Taxed Income, states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI resulting from those items in the year the tax is incurred. The Company has elected to recognize the resulting tax on GILTI as an expense in the period the tax is incurred. The Company’s interim effective income tax rate is based on management’s best current estimate of the Company's expected annual effective income tax rate. The Company recorded a pre-tax loss in the first nine months of fiscal year 2019 and its corresponding effective tax rate is (7.9)% before discrete items of $0.1 million related to foreign taxes. Tax expense in the nine months ended June 30, 2019 is due to state and foreign taxes paid. The effective tax rate differed from the statutory federal rate of 21% primarily as a result of the valuation allowance charge on current year losses and the impact of foreign, state, and local income taxes and permanent tax adjustments. The Company applies the authoritative guidance related to uncertainty in income taxes. ASC Topic 740, Income Taxes , states that a benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolution of any related appeals or litigation processes, on the basis of technical merits. During the three months ended June 30, 2019 , the Company recorded a $0.1 million tax charge for unrecognized tax benefits related to foreign tax exposures. The Company’s policy is to recognize interest and penalties in the period in which they occur in the income tax provision. The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction, various state and local jurisdictions and in foreign jurisdictions, primarily Canada and the United Kingdom. As of June 30, 2019 , none of the Company's federal or state income tax returns are under examination. The statute of limitations for U.S. federal income tax returns for years prior to fiscal 2015 is now closed. However, certain tax attribute carryforwards that were generated prior to fiscal 2015 may be adjusted upon examination by tax authorities if they are utilized. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity The changes in stockholders’ equity for the prior year comparable period is as follows (in thousands): Common Stock Shares Amount Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Balance at September 30, 2017 31,503,349 $ 29 $ 227,264 $ (6,431 ) $ (88,226 ) $ 132,636 Cumulative adjustment related to adoption of ASU 2016-09 — — 100 — (207 ) (107 ) Net loss — — — — (1,212 ) (1,212 ) Exercise of common stock options and vesting of restricted stock 386,330 — — — — — Compensation expense from grants of common stock options and restricted stock — — 1,262 — — 1,262 Foreign currency translation and other — — — (51 ) (6 ) (57 ) Balance at December 31, 2017 31,889,679 $ 29 $ 228,626 $ (6,482 ) $ (89,651 ) $ 132,522 Net loss — — — — (5,655 ) (5,655 ) Exercise of common stock options and vesting of restricted stock 103,398 — 12 — — 12 Compensation expense from grants of common stock options and restricted stock — — 1,212 — — 1,212 Foreign currency translation and other — — — 34 12 46 Balance at March 31, 2018 31,993,077 $ 29 $ 229,850 $ (6,448 ) $ (95,294 ) $ 128,137 Net loss — — — — (3,705 ) (3,705 ) Exercise of common stock options and vesting of restricted stock 116,654 — — — — — Compensation expense from grants of common stock options and restricted stock — — 1,477 — — 1,477 Foreign currency translation and other — — — (747 ) 159 (588 ) Balance at June 30, 2018 32,109,731 $ 29 $ 231,327 $ (7,195 ) $ (98,840 ) $ 125,321 2006 Omnibus Long-Term Incentive Plan Under the 2006 Omnibus Long-Term Incentive Plan, as amended (the 2006 Plan), 13,000,000 shares of common stock were available for issuance as of September 30, 2016. On February 23, 2017, at the Company's annual meeting of stockholders, the stockholders approved amendments to the 2006 Plan to increase the number of shares available for issuance under the 2006 Plan by 3,300,000 , to a total of 16,300,000 shares. The 2006 Plan has a fungible share pool so that awards other than options or stock appreciation rights granted are counted as 1.5 shares from the shares reserved for issuance. The maximum number of shares subject to options or stock appreciation rights that can be awarded under the 2006 Plan to any person is 1,000,000 per year. The maximum number of shares that can be awarded under the 2006 Plan to any person, other than pursuant to an option or stock appreciation right, is 700,000 per year. Stock-based Compensation Expense Stock-based compensation expense was $5.14 million for the nine months ended June 30, 2019 , which included $5.12 million related to stock options and restricted stock and $20 thousand related to cash-settled stock appreciation rights. Stock Options and Restricted Stock The following table presents the number of stock options and shares of restricted stock granted to employees under the Company's 2006 Plan and the grant date fair value of those stock awards for the periods presented: Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Stock options: Time-based 70,100 — 563,066 233,346 Weighted average grant date fair value $ 2.87 $ — $ 2.71 $ 2.00 Market-based and performance-based 70,100 — 551,250 318,780 Weighted average grant date fair value $ 2.87 $ — $ 2.69 $ 1.59 Restricted stock: Time-based 48,400 20,000 250,128 271,221 Weighted average grant date fair value $ 6.58 $ 6.50 $ 6.72 $ 6.64 Market-based and performance-based 48,400 — 178,600 246,340 Weighted average grant date fair value $ 4.56 $ — $ 5.36 $ 6.53 Stock options and restricted stock generally vest over four years. The market-based options and restricted stock units issued in fiscal year 2019 will vest in installments based on the total shareholder return of the Company's common stock over a four -year performance period. The performance-based restricted stock awards will vest in installments based on achievement of certain annual revenue and adjusted EBITDA targets through calendar year 2021, in each case, subject to each recipient's continued employment with the Company. In determining the fair value for stock options, volatility rates over the last three years have ranged from 49.71% to 54.93% , the dividend rate has been 0% , and risk-free interest rates have ranged from 1.65% to 2.78% . Cash-Settled Stock Appreciation Rights The Company issues cash-settled stock appreciation rights to non-executives with restrictions that lapse upon either the passage of time (service vesting), achievement of performance targets (performance vesting), achievement of market conditions (market vesting) or some combination of these conditions. The stock appreciation rights that include only service vesting conditions generally vest over a period of one - to four -years conditioned on continued employment for the incentive period. For performance vesting, stock appreciation rights generally vest and pay out on the achievement of financial metrics over a four -year period conditioned on continued employment for the incentive period. Cash-settled stock appreciation rights are recorded as liability awards. The Company did not issue any cash-settled stock appreciation rights during the three months ended June 30, 2019 . During the nine months ended June 30, 2019 , the Company issued 95,000 cash-settled stock appreciation rights at an exercise price of $6.11 . During the three months ended June 30, 2019 , 7,954 cash-settled stock appreciation rights were exercised and 15,273 cash-settled stock appreciation rights were canceled. During the nine months ended June 30, 2019 , 109,124 cash-settled stock appreciation rights were exercised and 403,321 cash-settled stock appreciation rights were canceled. As of June 30, 2019 , 516,760 cash-settled stock appreciation rights were outstanding. During the comparable three- and nine-month period in fiscal year 2018 , the Company did not issue any cash-settled stock appreciation rights. During the three months ended June 30, 2018 , 4,082 cash-settled stock appreciation rights were exercised and 85,756 cash-settled stock appreciation rights were canceled. During the nine months ended June 30, 2018 , 87,084 cash-settled stock appreciation rights were exercised and 358,660 cash-settled stock appreciation rights were canceled. As of June 30, 2018 , 1,007,889 cash-settled stock appreciation rights were outstanding. Share Repurchase Program The Company is authorized to repurchase issued and outstanding shares of its common stock under a share repurchase program approved by the Company's Board of Directors. Share repurchases may be made through open market purchases, privately negotiated transactions or otherwise, at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements and other market conditions. The repurchase program may be discontinued or suspended at any time and will be funded using available cash. The Company's Board of Directors reviews the share repurchase program from time to time, with the last such review occurring in May 2016. The Company did not repurchase shares under this program during the nine months ended June 30, 2019 or 2018. As of June 30, 2019 , the Company has $10.1 million of remaining authorization to repurchase shares under this program. |
Fair Value Measurement
Fair Value Measurement | 9 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | Fair Value Measurement The Company measures and records in the accompanying consolidated financial statements certain assets and liabilities at fair value on a recurring basis. Authoritative guidance issued by the FASB establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs). The hierarchy consists of three levels: Level 1 Quoted market prices in active markets for identical assets or liabilities; Level 2 Inputs other than Level 1 inputs that are either directly or indirectly observable; and Level 3 Unobservable inputs developed using estimates and assumptions developed by the Company, which reflect those that a market participant would use. During the year ended September 30, 2018, as a result of the acquisition of Machinio, the Company recorded contingent consideration which is measured at fair value (Level 3) at June 30, 2019 and September 30, 2018. The Company estimated the fair value of the contingent consideration using a Monte Carlo simulation. The simulation estimated Machinio's EBITDA over the calendar year 2019 earn-out period using a market-based volatility factor and market interest rates resulting in an average EBITDA. A present value factor was applied based on the expected settlement date of the contingent consideration. The liability for this consideration is included in Accrued expenses and other current liabilities in the consolidated balance sheets as of June 30, 2019 , and in Deferred taxes and other long-term liabilities as of September 30, 2018 , as the earn-out is expected to settle prior to the end of the third quarter of fiscal 2020. The changes in the earn-out liability and financial assets measured at fair value using Level 3 inputs to determine fair value for the nine months ended June 30, 2019 are as follows (in thousands): Contingent Consideration Balance at September 30, 2018 $ 1,300 Settlements — Change in fair value 2,300 Balance at June 30, 2019 $ 3,600 The increase in the fair value of the earn-out liability is primarily due to an increase in Machinio's estimated EBITDA over the earn out period, which was the result of Machinio's realized EBITDA for the six months ended June 30, 2019 exceeding the previous estimate. Secondary factors for the increase in fair value relate to the present value factor, which was impacted by the shorter period remaining until the earn out payment date, as well as a change in market conditions that reduced interest rates and the weighted average cost of capital. During the nine months ended June 30, 2018 , the Company had financial assets measured at fair value (Level 3) that represented the value of rights the Company held from its participation in certain principal transactions in the Company's commercial business. The Company no longer held these assets at September 30, 2018 . Financial Instruments Balance at September 30, 2017 $ 491 Settlements (401 ) Change in fair value (90 ) Balance at June 30, 2018 $ — When valuing its Level 3 liability, management’s estimation of fair value is based on the best information available in the circumstances and may incorporate management's own assumptions around market demand which could involve a level of judgment, taking into consideration a combination of internal and external factors. Changes in the fair value of the Company's Level 3 assets and liabilities are recorded in Other operating expenses in the consolidated statements of operations. The Company also has investments of $30 million and $20 million at June 30, 2019 and September 30, 2018 , respectively, in certificates of deposit with maturities of six months or less, and interest rates between 2.5% and 2.6% . These assets were measured at fair value at June 30, 2019 and September 30, 2018 and were classified as Level 1 assets within the fair value hierarchy. The Company’s financial assets and liabilities not measured at fair value are cash and cash equivalents (which includes cash and commercial paper with original maturities of less than 90 days), accounts receivable, a promissory note and accounts payable. The Company believes the carrying values of these instruments approximate fair value. At June 30, 2019 and September 30, 2018 , the Company did not have any assets or liabilities measured at fair value on a non-recurring basis. |
Defined Benefit Pension Plan
Defined Benefit Pension Plan | 9 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Defined Benefit Pension Plan | Defined Benefit Pension Plan Certain employees of Liquidity Services UK Limited (GoIndustry), which the Company acquired in July 2012, are covered by the Henry Butcher Pension Fund and Life Assurance Scheme (HB Pension Fund), a qualified defined benefit pension plan. The net periodic benefit recognized for the three and nine months ended June 30, 2019 and 2018 included the following components: Three Months Ended June 30, Nine Months Ended June 30, Qualified Defined Benefit Pension Plan 2019 2018 2019 2018 (dollars in thousands) Service cost $ — $ — $ — $ — Interest cost 136 158 446 493 Expected return on plan assets (222 ) (242 ) (695 ) (750 ) Settlement cost — — — (8 ) Total net periodic (benefit) $ (86 ) $ (84 ) $ (249 ) $ (265 ) As a result of the adoption of ASU 2017-07, the components of net periodic benefit other than the service cost component are recorded in Interest and other income, net in the consolidated statements of operations. |
Guarantees
Guarantees | 9 Months Ended |
Jun. 30, 2019 | |
Guarantees [Abstract] | |
Guarantees | Guarantees During the second quarter of 2015, the Company issued a guarantee to GoIndustry and the Trustees of the HB Pension Fund. Under the arrangement, the Company irrevocably and unconditionally (a) guarantees to the Trustees punctual performance by GoIndustry of all its Guaranteed Obligations, defined as all present and future obligations and liabilities (whether actual or contingent and whether owed jointly or severally in any capacity whatsoever) of the Company to make payments to the HB Pension Fund up to a maximum of 10 million British pounds, (b) undertakes with the Trustees that, whenever GoIndustry does not pay any amount when due in respect of its Guaranteed Obligations, it must immediately on demand by the Trustees pay that amount as if it were the principal obligor; and (c) indemnifies the Trustees as an independent and primary obligation immediately on demand against any cost, charge, expense, loss or liability suffered or incurred by the Trustees if any payment obligation guaranteed by it is or becomes unenforceable, invalid or illegal; the amount of the cost, charge, expense, loss or liability under this indemnity will be equal to the amount the Trustees would otherwise have been entitled to recover on the basis of a guarantee. The guarantee is a continuing guarantee that will extend to the ultimate balance of all sums payable by the Company in respect of its Guaranteed Obligations. As of June 30, 2019 and September 30, 2018, the Company's plan was in an overfunded status as the plan's assets exceeded the plan liabilities. The funded status of the HB Pension Fund as of September 30, 2018 , was disclosed in Note 13, Defined Benefit Pension Plan, to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2018 . |
Business Realignment Expenses
Business Realignment Expenses | 9 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Business Realignment Expenses | Business Realignment Expenses In April 2019, the Company performed a strategic reorganization that consolidated its go-to-market strategy for self-directed and fully-managed market place services to capitalize on growth opportunities. As a result, the Company incurred restructuring costs of $1.1 million for employee severance and benefit costs, which were paid during the three months ended June 30, 2019. In June 2019, as a result Scrap Contract commencing the phase-out period that will conclude on September 30, 2019, the Company incurred restructuring costs of $0.2 million for employee termination and benefit costs during the three months ended June 30, 2019, which are expected to be paid during the fourth quarter of fiscal 2019 and the first quarter of fiscal 2020. During the fourth quarter of fiscal year 2017 the Company began to restructure its CAG business, resulting in severance costs incurred and the closure of several offices and legal entities in Europe and Asia for total restructuring costs of $1.0 million . The Company continued to implement its CAG cost cutting initiatives from the year ended September 30, 2018. As discussed in Note 3, Significant Contracts, the Company was not the high bidder for the new surplus contracts, and completed winding down its operations under the Surplus Contract during the year ended September 30, 2018. As a result, the Company recognized an additional $1.7 million of restructuring costs in fiscal 2018. During the nine months ended June 30, 2018 the Company recorded $1.5 million in restructuring costs, $1.0 million of which related to severance and occupancy costs in connection with the wind-down of the Surplus Contract. The remaining restructuring balance at June 30, 2019 of $0.3 million in occupancy related charges is expected to be paid by fiscal 2020. During fiscal year 2017, the Company reorganized its IronDirect business. As a result, the Company recorded $1.1 million of restructuring charges during the year ended September 30, 2018. The Company continued its reorganization of the IronDirect business during the three months ended December 31, 2018 and ultimately decided to exit the business, resulting in severance costs of $0.2 million recognized during the three months ended December 31, 2018. The Company fully exited the IronDirect business and wound down its operations during January 2019. The severance costs were paid during the three months ended March 31, 2019. In June 2017, the Company entered into an agreement to sub-lease office space at 6931 Arlington Road, Bethesda, Maryland. On the sub-lease commencement date, the Company relocated its headquarters from 1920 L Street NW, Washington DC, to the Bethesda location and recognized a $2.0 million cease-use charge in its consolidated statements of operations at September 30, 2017. At September 30, 2018 , the remaining cease-use accrual was $0.8 million . During the nine months ended June 30, 2019 , the Company paid down the cease-use charge by $0.7 million . The remaining balance of $0.1 million is expected to be paid during fiscal 2019. This activity is presented under occupancy cost in the table below. During the nine months ended June 30, 2018 , the Company recognized $0.5 million in severance cost primarily related to the restructuring of its Corporate Information Technology department. This cost is recorded within the Corporate & Other line item below. Business realignment expenses were as follows for the periods presented (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Employee severance and benefit costs: CAG $ 248 $ 20 $ 248 $ 900 Corporate & Other 1,125 (12 ) 1,295 463 Total employee severance and benefit costs 1,373 8 1,543 1,363 Occupancy and other costs: CAG — 241 51 675 Corporate & Other — — 134 35 Total occupancy and other costs — 241 185 710 Total business realignment expenses $ 1,373 $ 249 $ 1,728 $ 2,073 Business realignment expenses per the table above are recorded in Other operating expenses in the consolidated statements of operations. The table below sets forth the significant components of and activity in the liability for business realignment initiatives during the periods presented, on a segment and consolidated basis: (in thousands) Liability Balance at September 30, 2017 Business Realignment Expenses Cash Payments Liability Balance at September 30, 2018 Business Realignment Expenses Cash Payments Liability Balance at June 30, 2019 Employee severance and benefit costs: CAG $ 793 $ 979 $ (1,683 ) $ 89 $ 248 $ (89 ) $ 248 Corporate & Other 399 472 (850 ) 21 1,295 (1,316 ) $ — Total employee severance and benefit costs $ 1,192 $ 1,451 $ (2,533 ) $ 110 $ 1,543 $ (1,405 ) $ 248 Occupancy and other costs: CAG — 739 (280 ) 459 51 (307 ) $ 203 Corporate & Other 1,988 (248 ) (933 ) 807 134 (843 ) $ 98 Total occupancy and other costs $ 1,988 $ 491 $ (1,213 ) $ 1,266 $ 185 $ (1,150 ) $ 301 Total business realignment $ 3,180 $ 1,942 $ (3,746 ) $ 1,376 $ 1,728 $ (2,555 ) $ 549 |
Legal Proceedings and Other Con
Legal Proceedings and Other Contingencies | 9 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal Proceedings and Other Contingencies The Company reserves for contingent liabilities based on ASC 450, Contingencies , when it determines that a liability is probable and reasonably estimable. From time to time, the Company may become involved in litigation relating to claims arising in the ordinary course of the business. During the three months ended June 30, 2019, the Company determined that it was probable that a liability would result from a sales tax audit performed by the State of California. The liability was estimated at $0.6 million , including interest and penalties, and is recorded as a component of Accrued expenses and other current liabilities in the consolidated balance sheets. There are no other claims or actions pending or threatened against the Company that, if adversely determined, would in the Company's management's judgment have a material adverse effect on the Company. |
Segment Information
Segment Information | 9 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company provides results in four reportable operating segments: GovDeals, CAG, RSCG and Machinio. The GovDeals, CAG, RSCG and Machinio segments constituted over 99% of the Company's revenue during the nine months ended June 30, 2019 . Each reportable segment offers separately branded marketplaces to enable Sellers to achieve their respective channel marketing objectives to reach Buyers. Across its segments, the Company offers its Sellers two primary transaction models, as well as a suite of services, and its revenues vary depending upon the models employed and the level of service required. A description of the reportable segments is provided below: • The GovDeals reportable segment provides self-directed service offerings in which Sellers list their own assets, and it consists of marketplaces that enable local and state government entities, including city, county and state agencies, as well as commercial businesses located in the United States and Canada, to sell surplus and salvage assets. GovDeals also offers a suite of marketing services to Sellers. This segment includes the Company's GovDeals.com and AuctionDeals.com marketplaces. • The CAG reportable segment provides fully-managed offerings to Sellers and consists of marketplaces that enable federal government agencies, as well as commercial businesses, to sell surplus, salvage, and scrap assets. CAG also offers a suite of services that includes marketing services, surplus management and asset valuation. Commercial Sellers are located in the United States, Europe, Australia and Asia. This segment includes the Company's Network International, GoIndustry DoveBid, and Government Liquidation marketplaces. Sales of assets procured through our Surplus Contract, which wound down during 2018, and our Scrap Contract, which will conclude on September 30, 2019, are conducted through the Government Liquidation marketplace. • The RSCG reportable segment consists of marketplaces that enable corporations located in the United States and Canada to sell surplus and salvage consumer goods and retail capital assets. RSCG also offers a suite of services that includes returns management, asset recovery, and ecommerce services. This segment includes the Company's Liquidation.com, Liquidation.com DIRECT, and Secondipity marketplaces. • The Machinio reportable segment operates a global online platform for listing used equipment for sale in the construction, machine tool, transportation, printing and agriculture sectors. Machinio was acquired by the Company in July 2018. Corporate & Other included the IronDirect operating segment that was not individually significant as a reportable operating segment until January 2019, when the Company exited the IronDirect business and fully wound down its operations. IronDirect offered Buyers access to construction equipment, parts and services through a single ecommerce marketplace. Decisions concerning the allocation of the Company’s resources are made by the Company’s Chief Operating Decision Maker ("CODM"), which is the Company's Chief Executive Officer, with oversight by the Board of Directors. The Company reports segment information based on the internal performance measures used by the CODM to assess the performance of each operating segment in a given period. In connection with that assessment, the CODM uses segment gross profit to evaluate the performance of each segment. Segment gross profit is calculated as total revenue less cost of goods sold (exclusive of depreciation and amortization) and Seller distributions. The amount of our revenue that came from sales outside of the United States for the three months ended June 30, 2019 and 2018 was 13.6% and 11.1% , respectively, and 14.9% and 12.2% for the nine months ended June 30, 2019 and 2018 , respectively. The following table sets forth certain financial information for the Company's reportable segments and Corporate & Other (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 GovDeals: Revenue $ — $ — $ — $ — Fee revenue 9,280 8,421 24,635 22,554 Total revenue 9,280 8,421 24,635 22,554 Gross profit $ 8,560 $ 7,795 $ 22,663 $ 20,927 CAG: Revenue $ 9,377 $ 8,341 $ 26,105 $ 49,164 Fee revenue 5,513 6,670 17,951 23,066 Total revenue 14,890 15,011 44,056 72,230 Gross profit $ 7,759 $ 9,911 $ 25,255 $ 39,973 RSCG: Revenue $ 27,011 $ 22,952 $ 82,904 $ 63,027 Fee revenue 4,250 3,391 11,846 10,715 Total revenue 31,261 26,343 94,750 73,742 Gross profit $ 10,874 $ 9,305 $ 32,710 $ 24,649 Machinio: Revenue $ — $ — $ — $ — Fee revenue 1,451 — 3,816 — Total revenue 1,451 — 3,816 — Gross Profit $ 1,358 $ — $ 3,501 $ — Corporate & Other: Revenue $ — $ 787 $ 469 $ 3,273 Fee revenue — 7 9 10 Total revenue — 794 478 3,283 Gross profit $ — $ 133 $ 113 $ (694 ) Consolidated: Revenue $ 36,388 $ 32,080 $ 109,478 $ 115,464 Fee revenue 20,494 18,489 58,257 56,345 Total revenue 56,882 50,569 167,735 171,809 Gross profit $ 28,551 $ 27,144 $ 84,242 $ 84,855 The following table presents a reconciliation of gross profit used in the reportable segments as well as Corporate & Other and the Company's consolidated results (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Reconciliation: Gross profit $ 28,551 $ 27,144 $ 84,242 $ 84,855 Operating expenses 31,081 29,916 94,777 98,070 Other operating expenses 2,031 452 3,586 2,222 Interest and other income, net (454 ) (131 ) (1,224 ) (1,041 ) Provision (benefit) for income taxes 542 612 1,136 (3,824 ) Net loss $ (4,649 ) $ (3,705 ) $ (14,033 ) $ (10,572 ) |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal, recurring adjustments considered necessary for a fair presentation, have been included. The information disclosed in the notes to the consolidated financial statements for these periods is unaudited. Operating results for the three and nine months ended June 30, 2019 are not necessarily indicative of the results that may be expected for the year ending September 30, 2019 or for any future period. |
Revenue Recognition | Revenue Recognition In the Consolidated Statements of Operations, revenue from the resale of inventory that the Company purchases from Sellers is recognized within Revenue. Commission fees from the sale of inventory that the Company sells on a consignment basis and other non-consignment fee revenue, which is made up of subscription fee and service revenue from the Surplus Contract (defined below) in the prior year, is recognized within Fee Revenue. The Company adopted the Financial Accounting Standard Board's (FASB) Accounting Standards Codification (ASC) Topic 606, Revenue from Contracts with Customers (ASC 606) effective October 1, 2018. As a result of adopting ASC 606, there have been significant changes to the Company's revenue recognition policy from the policy disclosed in Note 2 -Summary of Significant Accounting Polices in the Company’s Annual Report on Form 10-K for the year ended September 30, 2018 . These changes are described below. The Company recognizes revenue when or as performance obligations are satisfied and control is transferred to the customer. Revenue is recognized in the amount that reflects the consideration to which the Company expects to be entitled. Revenue is also evaluated to determine whether the Company should report the gross proceeds as revenue, when the Company acts as the principal in the arrangement, or the Company should report its revenue on a net basis, when the Company acts as an agent. Specifically, when other parties are involved in providing goods or services to a customer, the Company must determine whether the nature of its promise is a performance obligation to provide the specified goods or services itself, or to arrange for another party to provide them. The Company evaluates the following factors to determine if it is acting as a principal: (1) whether the Company is primarily responsible for fulfilling the promise to provide the asset or assets; (2) whether the Company has inventory risk of the asset or assets before they are transferred to the Buyer; and (3) whether the Company has discretion in establishing the price for the asset or assets. The Company enters into contracts with Buyers and Sellers. The Company has master agreements with some Sellers pertaining to the sale of a flow of surplus assets over the term of the master agreement, however; a contract for accounting purposes exists when the Company agrees to sell a specific asset or assets. When acting as a principal (a “purchase” arrangement), the Company purchases an asset or assets from a Seller and then the Company seeks to sell the asset or assets to a Buyer. The Company recognizes as Revenue the gross proceeds from the sale, including Buyer's premiums. In purchase arrangements, the contract with the Seller is not a contract in the scope of the revenue recognition guidance; rather, it is a purchase of inventory. When the Company is acting as an agent (a “consignment” arrangement), its performance obligation is to arrange for the Seller to sell an asset or assets to the Buyer directly. The Company recognizes Fee Revenue based on the sales commissions that are paid to the Company by the Sellers for utilizing the Company's services; in this situation, sales commissions represent a percentage of the gross proceeds from the sale that the Seller pays to the Company upon completion of the transaction. In both purchase and consignment contracts, the Company sometimes provides distinct services to the Seller, such as returns management or refurbishment of assets. These services are distinct because the Seller could benefit from the services separately from the asset sale, and as such they are treated as separate performance obligations. Some services provided to Sellers are not distinct, like providing access to the Company’s e-commerce marketplaces or promoting the asset or assets for sale, because they could not benefit the Seller separately from the sale of the asset or assets. The consideration received from Buyers and Sellers includes (1) Buyer’s premiums, (2) Seller’s commissions, and (3) fees for services, including reimbursed expenses. Consideration is variable based on units, final auction prices, or other factors, until the Buyer’s purchase of the asset or assets is complete, or the service has been provided. Recognition of variable consideration that is based on the results of auctions or purchases by Buyers is constrained until those transactions have been finalized. The Company estimates and recognizes amounts related to sales returns, discounts or rebates promised to customers, and reimbursed expenses. The total transaction price is allocated to each distinct performance obligation and revenue is recognized when or as the performance obligation is satisfied. Variable consideration is allocated to individual performance obligations when the variable consideration is related to satisfying that performance obligation and consistent with the allocation objective. The Company's revenue is generally recorded subsequent to receipt of payment authorization, utilizing credit cards, wire transfers and PayPal, an Internet-based payment system, as methods of payments. Goods are generally not shipped before payment is received. For certain transactions, payment is due upon invoice and the payment terms vary depending on the business segment. The Company collects and remits sales taxes on merchandise that it purchases and sells and has elected the practical expedient to report such amounts under the net method in its Consolidated Statements of Operations. The Company also provides shipping and handling services in some arrangements and has elected the practical expedient to treat those activities as a fulfillment cost. If the Company is acting as a principal for the combined obligation, amounts received from customers for shipping are recognized as Revenue, and amounts paid for shipping are recognized as costs of goods sold. If the Company is acting as an agent for the combined obligation, shipping revenue and costs will be netted and recognized within costs of goods sold. The Company’s performance obligations are satisfied when control of the asset is transferred to the Buyer or when the service is completed. The Company determines when control has transferred by evaluating the following five indicators: (1) whether the Company has a present right to payment for the asset or assets; (2) whether the Buyer has legal title to the asset; (3) whether the Buyer has physical possession of the asset or assets; (4) whether the Buyer has the significant risks and rewards of ownership; and (5) whether the Buyer has accepted the asset or assets. For the Company's Machinio business segment, the performance obligation is satisfied over time as the Company provides the sales listing services over the term of the subscription. At June 30, 2019 , the Machinio business segment had a remaining performance obligation of $3.2 million ; the Company expects to recognize the substantial majority of that amount as Fee Revenue over the next 12 months. Cost of Goods Sold Cost of goods sold includes the costs of purchasing and transporting property for auction, credit card transaction fees and shipping and handling costs. The Company purchases the majority of its inventory at a percentage of the vendor's last retail price under certain commercial contracts within its RSCG segment, and at specifically negotiated prices within its CAG segment. Title for the inventory passes to the Company at the time of purchase and the Company bears the risks and rewards of ownership. The Company does not have title to assets sold on behalf of its commercial or government Sellers when it receives only sales commission revenue and, as such, recognizes no inventory or the corresponding cost of goods sold from inventory purchases associated with those sales. Contract Assets and Liabilities Contract assets reflect an estimate of expenses that will be reimbursed upon settlement with a Seller. The contract asset balance was $0.7 million as of October 1, 2018 and $0.4 million as of June 30, 2019 and is included in the line item Prepaid expenses and other current assets on the consolidated balance sheets. Contract liabilities reflect obligations to provide services for which the Company has already received consideration, and generally arise from up-front payments received in connection with Machinio's subscription services. The contract liability balance was $2.1 million as of October 1, 2018, and $3.2 million as of June 30, 2019 and is included in the line item Deferred revenue on the consolidated balance sheets. Of the October 1, 2018 contract liability balance, $1.9 million was earned as Fee Revenue during the nine months ended June 30, 2019 . Contract Costs Contract costs relate to sales commissions paid on consignment contracts that are capitalized. Contract costs are amortized over the expected life of the customer contract. The contract cost balance was $0.1 million as of October 1, 2018 and $0.4 million as of June 30, 2019 and is included in the line item Prepaid expenses and other current assets and Other assets on the consolidated balance sheet. Amortization expense was immaterial during the three and nine months ended June 30, 2019 . |
Promissory Note | Promissory Note On September 30, 2015, the Company sold certain assets related to its Jacobs Trading business to Tanager Acquisitions, LLC (Tanager). In connection with the disposition, Tanager assumed certain liabilities related to the Jacobs Trading business. Tanager issued a $12.3 million five -year interest-bearing promissory note to the Company, with principal payments due annually on each September 30. Of the $12.3 million , $4.0 million has been repaid as of June 30, 2019 . Of the remaining $8.3 million , $6.3 million is recorded on the consolidated balance sheet in Other assets, and $2.0 million in Prepaid expenses and other current assets as of June 30, 2019 based on the scheduled repayment dates. |
Risk Associated with Certain Concentrations | Risk Associated with Certain Concentrations The Company does not perform credit evaluations for the majority of its Buyers. However, most sales are recorded subsequent to payment authorization being received. As a result, the Company is not subject to significant collection risk, as most goods are not shipped before payment is received. For consignment sales transactions, funds are typically collected from Buyers and are held by the Company on the Sellers' behalf. The funds are included in Cash and cash equivalents in the Consolidated Balance Sheets. The Company releases the funds to the Seller, less the Company's commission and other fees due, after the Buyer has accepted the goods or within 30 days, depending on the state where the Buyer and Seller conduct business. The amount of cash held on behalf of Sellers is recorded within Payables to sellers on the consolidated balance sheets. Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash in banks over FDIC limits, certificates of deposit, and accounts receivable. The Company deposits its cash with financial institutions that the Company considers to be of high credit quality. |
Earnings per Share | Earnings per Share The Company calculates net income (loss) per share in accordance with FASB Topic 260 Earnings Per Share (ASC 260). Under ASC 260, basic net income (loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares of common stock outstanding includes vested restricted stock units. Diluted net income (loss) per share reflects the potential dilution that could occur assuming conversion or exercise of all dilutive unexercised stock options and unvested restricted stock units. The dilutive effect of unexercised stock options and unvested restricted stock units was determined using the treasury stock method. Under the treasury stock method, the proceeds received from the exercise of stock options and the amount of compensation cost for future service not yet recognized by the Company are assumed to be used to repurchase shares of the Company’s common stock. Stock options and restricted stock units are not included in the computation of diluted net income (loss) per share when they are antidilutive. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Standards Adopted On October 1, 2018, the Company adopted ASC 606 using the modified retrospective transition method. The Company applied the new revenue standard to all contracts that were not completed as of October 1, 2018 on a modified retrospective basis and recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of retained earnings. The comparative period information has not been restated and continues to be reported under the accounting standards in effect for those periods. The cumulative effect of the changes made to the consolidated October 1, 2018 balance sheet for the adoption of ASC 606 was as follows (in thousands): Balance at September 30, 2018 Adjustment due to adoption of ASC 606 Balance as adjusted at October 1, 2018 Prepaid expenses and other current assets $ 7,816 $ 671 $ 8,487 Other assets $ 14,124 $ 59 $ 14,183 Retained earnings $ (100,045 ) $ 730 $ (99,315 ) The impact of adopting ASC 606 on the Company’s consolidated statement of operations and the consolidated balance sheet for the period ended June 30, 2019 was as follows (in thousands): Three months ended June 30, 2019 Nine months ended June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated statement of operations: Fee revenue $ 20,494 $ 20,801 $ (307 ) $ 58,257 $ 58,558 $ (301 ) June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated balance sheet: Prepaid expenses and other current assets $ 8,129 $ 7,603 $ 526 Other assets $ 14,299 $ 14,026 $ 273 Accumulated deficit $ (113,348 ) $ (112,549 ) $ (799 ) In May 2017, the FASB issued ASU 2017-09, Scope of Modification Accounting . ASU 2017-09 provides guidance about which changes to terms or conditions of share-based payment awards require the application of modification accounting in Topic 718, Compensation - Stock Compensation . The ASU was adopted on October 1, 2018 and the Company will apply the guidance in ASU 2017-09 on a prospective basis to its award modifications. The adoption of this ASU has not had a material impact on the Company's consolidated financial statements. In March 2017, the FASB issued ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost . ASU 2017-07 changes how employers that sponsor defined benefit pension and/or other postretirement benefit plans present the cost of the benefits in the income statement. Under this standard, employers will present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Employers will present the other components of the net periodic benefit cost separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. The adoption of ASU 2017-07 on October 1, 2018, using the retrospective method, did not have a material impact on the Company's consolidated financial statements. As a result of adopting this standard $84 thousand and $265 thousand for three and nine months ended June 30, 2018 , respectively, were reclassified in the consolidated statement of operations from General and administrative, a component of loss from operations, to Interest and other income, net, which is outside of loss from operations. In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business . ASU 2017-01 clarifies the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill and consolidation. The ASU was adopted on October 1, 2018 and the Company will apply the guidance on a prospective basis when entering into acquisitions of assets or businesses. The adoption of this ASU has not had a material impact on the Company's consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other Than Inventory . The ASU requires companies to recognize the income tax effects of intercompany sales or transfers of assets, other than inventory, in the income statement as income tax expense (or benefit) in the period the sale or transfer occurs. The exception to recognizing the income tax effects of intercompany sales or transfers of assets remains in place for intercompany inventory sales and transfers. The adoption of the ASU on October 1, 2018 did not have a material impact on the Company’s consolidated statement of operations. In 2016, the FASB issued ASU 2016-15, Classification of Certain Cash Receipts and Cash Payments and ASU 2016-18, Restricted Cash . These ASUs clarify how entities should classify certain cash receipts and cash payments on the statement of cash flows and requires that the statement of cash flows explain the change during the period in the total cash, cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. These standards were adopted on October 1, 2018 on a retrospective basis and there was no impact on the Company's consolidated statement of cash flows. Accounting Standards Not Yet Adopted In August 2018, the FASB issued ASU 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract. ASU 2018-15 aligns the requirements for capitalizing implementation costs in a cloud computing arrangement with the requirement for capitalizing implementation costs incurred to develop or obtain internal-use software. This ASU will become effective for the Company beginning October 1, 2020. The Company is currently evaluating the effect that the adoption of this ASU may have on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans . The ASU amends the existing accounting standard for defined benefit plans by removing, modifying, and adding certain disclosures, and will become effective for the Company beginning October 1, 2021 with early adoption permitted. The Company has evaluated the potential impact of this ASU on its Defined Benefit Pension Plan disclosures. The primary impact of this ASU relates to the disclosure of significant gains and losses resulting from changes in the benefit obligation or plan assets during the period. If significant changes are noted, and they result from changes that are not otherwise apparent from the other required disclosures (e.g. changes resulting from discount rates are already required to be disclosed), the Company will provide qualitative explanations for those changes. The Company plans to early adopt this ASU in its annual financial statements for the year-ended September 30, 2019. In August 2018, the FASB issued ASU 2018-13, Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurements . The ASU amends the existing accounting standard for fair value measurement by removing, modifying, and adding certain disclosures, and will become effective for the Company beginning October 1, 2020 with early adoption permitted. The Company has evaluated the potential impact of this ASU on its Fair Value Measurement disclosures. The primary impact of this ASU is a clarification that the measurement uncertainty disclosure related to Level 3 inputs is intended to communicate information about such uncertainty as of the reporting date, rather than sensitivity to potential future changes in those inputs. The Company plans to early adopt this ASU in its annual financial statements for the year-ended September 30, 2019. In June 2018, the FASB issued ASU 2018-07, Improvements to Nonemployee Share-based Payment Accounting. The ASU amends the existing accounting standards for share-based payments to nonemployees, and applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in its own operation by issuing share-based payment awards. Additionally, the ASU clarifies that Topic 718 does not apply to share-based payments used to effectively provide financing to the issuer or awards granted in conjunction with selling goods or services to customers as part of a contract accounted under ASC 606. The ASU will become effective for the Company beginning October 1, 2019. As of June 30, 2019, the only nonemployees that have received awards are the nonemployee members of the Company's Board of Directors. However, as these awards represent compensation solely for their roles as Directors, the Directors are considered to be employees under Topic 718. As a result, no impact is expected from the adoption of this ASU. In February 2018, the FASB issued ASU 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The ASU allows entities to elect to classify from accumulated other comprehensive income (loss) to retained earnings stranded tax effects resulting from the Tax Cuts and Jobs Act (the "Tax Act") enacted on December 22, 2017. An entity that does not elect to reclassify the income tax effects of the Tax Act shall disclose in the period of adoption a statement that the election was not made. The ASU will become effective for the Company beginning on October 1, 2019. The Company is currently evaluating whether it will elect to reclassify the income tax effects of the Tax Act from accumulated other comprehensive income to retained earnings. In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment . The ASU requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity is required to recognize an impairment charge for the amount by which the carrying amount of a reporting unit exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Additionally, an entity is required to consider income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss, if applicable. This guidance will become effective for the Company beginning on October 1, 2020. The Company plans to early adopt this ASU and apply it to the Company's annual impairment assessment to be performed in its fiscal fourth quarter of 2019. An impact of adoption will only be noted to the extent that the annual impairment assessment results in a reporting unit whose carrying amount exceeds its fair value. In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326) , or ASC 326. ASC 326, including all amendments and related guidance, was designed to provide financial statement users with more useful information about the expected credit losses on financial instruments and other commitments to extend credit. ASC 326 will require estimation of expected credit losses using a methodology that takes into consideration a broad range of reasonable and supportable information. The guidance will be effective for the Company beginning on October 1, 2020, and will be applied on a modified-retrospective basis, with any cumulative-effect adjustment recorded to retained earnings on the adoption date. The Company is in the process of evaluating the impact ASC 326 will have on its consolidated financial statements and expects to estimate credit losses on its financial assets such as its Accounts Receivable, Short-term Investments, and Promissory Note. While the Company has not experienced significant credit losses historically, the materiality of the impact of adoption will depend on events and conditions as of the date of adoption, which cannot be determined conclusively at this time. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , or ASC 842. ASC 842, including all amendments and related guidance, will change the way the Company recognizes its leased assets. It will require organizations that lease assets—referred to as "lessees"—to recognize on the balance sheet the assets and liabilities representing the rights and obligations created by those leases. ASC 842 will also require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The guidance will be effective for the Company beginning on October 1, 2019. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into, after either the adoption date or the beginning of the earliest comparative period presented in the financial statements. The Company is in the process of aggregating its worldwide lease portfolio, and has identified a software solution to use in its adoption of ASC 842 and for its subsequent lease accounting requirements. In its adoption of ASU 842, the Company will not adjust its comparative periods. In addition, the Company will elect to use the package of practical expedients offered by ASC 842, which will permit the Company to not reassess whether a contract is or contains a lease, lease classification, or initial direct costs. The Company will not apply hindsight when determining the lease term. For all of its asset classes, the Company will account for both lease and nonlease components as a single component and account for it as a lease, and the Company will not recognize right-of-use assets or lease liabilities for its short-term leases. The Company will use incremental borrowing rates that are consistent with the lease term determined at the lease's commencement. The adoption of ASC 842 will result in the recognition of right-of-use assets and lease liabilities on the Company's consolidated balance sheets, and will require the Company to make quantitative and qualitative disclosures about its leases. Additional impacts, which may be material, may be identified as the Company completes its adoption process. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Impact of adoption of ASC 606 | The cumulative effect of the changes made to the consolidated October 1, 2018 balance sheet for the adoption of ASC 606 was as follows (in thousands): Balance at September 30, 2018 Adjustment due to adoption of ASC 606 Balance as adjusted at October 1, 2018 Prepaid expenses and other current assets $ 7,816 $ 671 $ 8,487 Other assets $ 14,124 $ 59 $ 14,183 Retained earnings $ (100,045 ) $ 730 $ (99,315 ) The impact of adopting ASC 606 on the Company’s consolidated statement of operations and the consolidated balance sheet for the period ended June 30, 2019 was as follows (in thousands): Three months ended June 30, 2019 Nine months ended June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated statement of operations: Fee revenue $ 20,494 $ 20,801 $ (307 ) $ 58,257 $ 58,558 $ (301 ) June 30, 2019 As reported Balance without adoption of ASC 606 Effect of change Higher/(lower) Consolidated balance sheet: Prepaid expenses and other current assets $ 8,129 $ 7,603 $ 526 Other assets $ 14,299 $ 14,026 $ 273 Accumulated deficit $ (113,348 ) $ (112,549 ) $ (799 ) |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of goodwill activity | The following table presents changes in the carrying amount of goodwill by reportable segment: Goodwill (in thousands) CAG GovDeals Machinio Total Balance at September 30, 2017 $ 21,657 $ 23,731 $ — $ 45,388 Business acquisition — — 14,558 14,558 Translation adjustments (127 ) — — (127 ) Balance at September 30, 2018 $ 21,530 $ 23,731 $ 14,558 $ 59,819 Translation adjustments (134 ) — — (134 ) Balance at June 30, 2019 $ 21,396 $ 23,731 $ 14,558 $ 59,685 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | |
Schedule of intangible assets | The components of identifiable intangible assets as of June 30, 2019 and September 30, 2018 are as follows: June 30, 2019 September 30, 2018 Useful Life (in years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (dollars in thousands) Contract intangibles 6 $ 3,100 $ (516 ) $ 2,584 $ 3,100 $ (129 ) $ 2,971 Technology 5 2,700 (540 ) 2,160 2,700 (135 ) 2,565 Patent and trademarks 3 - 10 2,346 (713 ) 1,633 2,269 (439 ) 1,830 Total intangible assets $ 8,146 $ (1,769 ) $ 6,377 $ 8,069 $ (703 ) $ 7,366 |
Schedule of future expected amortization of intangible assets | Future expected amortization of intangible assets at June 30, 2019 is as follows: Future Amortization Years ending September 30, (in thousands) Remaining three months of 2019 $ 336 2020 1,342 2021 1,334 2022 1,321 2023 1,177 2024 and thereafter 867 Total $ 6,377 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of stockholders equity | The changes in stockholders’ equity for the prior year comparable period is as follows (in thousands): Common Stock Shares Amount Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Total Balance at September 30, 2017 31,503,349 $ 29 $ 227,264 $ (6,431 ) $ (88,226 ) $ 132,636 Cumulative adjustment related to adoption of ASU 2016-09 — — 100 — (207 ) (107 ) Net loss — — — — (1,212 ) (1,212 ) Exercise of common stock options and vesting of restricted stock 386,330 — — — — — Compensation expense from grants of common stock options and restricted stock — — 1,262 — — 1,262 Foreign currency translation and other — — — (51 ) (6 ) (57 ) Balance at December 31, 2017 31,889,679 $ 29 $ 228,626 $ (6,482 ) $ (89,651 ) $ 132,522 Net loss — — — — (5,655 ) (5,655 ) Exercise of common stock options and vesting of restricted stock 103,398 — 12 — — 12 Compensation expense from grants of common stock options and restricted stock — — 1,212 — — 1,212 Foreign currency translation and other — — — 34 12 46 Balance at March 31, 2018 31,993,077 $ 29 $ 229,850 $ (6,448 ) $ (95,294 ) $ 128,137 Net loss — — — — (3,705 ) (3,705 ) Exercise of common stock options and vesting of restricted stock 116,654 — — — — — Compensation expense from grants of common stock options and restricted stock — — 1,477 — — 1,477 Foreign currency translation and other — — — (747 ) 159 (588 ) Balance at June 30, 2018 32,109,731 $ 29 $ 231,327 $ (7,195 ) $ (98,840 ) $ 125,321 |
Summary of stock options and restricted stock granted | The following table presents the number of stock options and shares of restricted stock granted to employees under the Company's 2006 Plan and the grant date fair value of those stock awards for the periods presented: Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Stock options: Time-based 70,100 — 563,066 233,346 Weighted average grant date fair value $ 2.87 $ — $ 2.71 $ 2.00 Market-based and performance-based 70,100 — 551,250 318,780 Weighted average grant date fair value $ 2.87 $ — $ 2.69 $ 1.59 Restricted stock: Time-based 48,400 20,000 250,128 271,221 Weighted average grant date fair value $ 6.58 $ 6.50 $ 6.72 $ 6.64 Market-based and performance-based 48,400 — 178,600 246,340 Weighted average grant date fair value $ 4.56 $ — $ 5.36 $ 6.53 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Changes in financial assets fair value | The changes in the earn-out liability and financial assets measured at fair value using Level 3 inputs to determine fair value for the nine months ended June 30, 2019 are as follows (in thousands): Contingent Consideration Balance at September 30, 2018 $ 1,300 Settlements — Change in fair value 2,300 Balance at June 30, 2019 $ 3,600 The increase in the fair value of the earn-out liability is primarily due to an increase in Machinio's estimated EBITDA over the earn out period, which was the result of Machinio's realized EBITDA for the six months ended June 30, 2019 exceeding the previous estimate. Secondary factors for the increase in fair value relate to the present value factor, which was impacted by the shorter period remaining until the earn out payment date, as well as a change in market conditions that reduced interest rates and the weighted average cost of capital. During the nine months ended June 30, 2018 , the Company had financial assets measured at fair value (Level 3) that represented the value of rights the Company held from its participation in certain principal transactions in the Company's commercial business. The Company no longer held these assets at September 30, 2018 . Financial Instruments Balance at September 30, 2017 $ 491 Settlements (401 ) Change in fair value (90 ) Balance at June 30, 2018 $ — |
Defined Benefit Pension Plan (T
Defined Benefit Pension Plan (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of net periodic benefit cost recognized | The net periodic benefit recognized for the three and nine months ended June 30, 2019 and 2018 included the following components: Three Months Ended June 30, Nine Months Ended June 30, Qualified Defined Benefit Pension Plan 2019 2018 2019 2018 (dollars in thousands) Service cost $ — $ — $ — $ — Interest cost 136 158 446 493 Expected return on plan assets (222 ) (242 ) (695 ) (750 ) Settlement cost — — — (8 ) Total net periodic (benefit) $ (86 ) $ (84 ) $ (249 ) $ (265 ) |
Business Realignment Expenses (
Business Realignment Expenses (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and related costs | Business realignment expenses were as follows for the periods presented (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Employee severance and benefit costs: CAG $ 248 $ 20 $ 248 $ 900 Corporate & Other 1,125 (12 ) 1,295 463 Total employee severance and benefit costs 1,373 8 1,543 1,363 Occupancy and other costs: CAG — 241 51 675 Corporate & Other — — 134 35 Total occupancy and other costs — 241 185 710 Total business realignment expenses $ 1,373 $ 249 $ 1,728 $ 2,073 The table below sets forth the significant components of and activity in the liability for business realignment initiatives during the periods presented, on a segment and consolidated basis: (in thousands) Liability Balance at September 30, 2017 Business Realignment Expenses Cash Payments Liability Balance at September 30, 2018 Business Realignment Expenses Cash Payments Liability Balance at June 30, 2019 Employee severance and benefit costs: CAG $ 793 $ 979 $ (1,683 ) $ 89 $ 248 $ (89 ) $ 248 Corporate & Other 399 472 (850 ) 21 1,295 (1,316 ) $ — Total employee severance and benefit costs $ 1,192 $ 1,451 $ (2,533 ) $ 110 $ 1,543 $ (1,405 ) $ 248 Occupancy and other costs: CAG — 739 (280 ) 459 51 (307 ) $ 203 Corporate & Other 1,988 (248 ) (933 ) 807 134 (843 ) $ 98 Total occupancy and other costs $ 1,988 $ 491 $ (1,213 ) $ 1,266 $ 185 $ (1,150 ) $ 301 Total business realignment $ 3,180 $ 1,942 $ (3,746 ) $ 1,376 $ 1,728 $ (2,555 ) $ 549 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information by segment | The following table sets forth certain financial information for the Company's reportable segments and Corporate & Other (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 GovDeals: Revenue $ — $ — $ — $ — Fee revenue 9,280 8,421 24,635 22,554 Total revenue 9,280 8,421 24,635 22,554 Gross profit $ 8,560 $ 7,795 $ 22,663 $ 20,927 CAG: Revenue $ 9,377 $ 8,341 $ 26,105 $ 49,164 Fee revenue 5,513 6,670 17,951 23,066 Total revenue 14,890 15,011 44,056 72,230 Gross profit $ 7,759 $ 9,911 $ 25,255 $ 39,973 RSCG: Revenue $ 27,011 $ 22,952 $ 82,904 $ 63,027 Fee revenue 4,250 3,391 11,846 10,715 Total revenue 31,261 26,343 94,750 73,742 Gross profit $ 10,874 $ 9,305 $ 32,710 $ 24,649 Machinio: Revenue $ — $ — $ — $ — Fee revenue 1,451 — 3,816 — Total revenue 1,451 — 3,816 — Gross Profit $ 1,358 $ — $ 3,501 $ — Corporate & Other: Revenue $ — $ 787 $ 469 $ 3,273 Fee revenue — 7 9 10 Total revenue — 794 478 3,283 Gross profit $ — $ 133 $ 113 $ (694 ) Consolidated: Revenue $ 36,388 $ 32,080 $ 109,478 $ 115,464 Fee revenue 20,494 18,489 58,257 56,345 Total revenue 56,882 50,569 167,735 171,809 Gross profit $ 28,551 $ 27,144 $ 84,242 $ 84,855 |
Reconciliation of revenue from segments to consolidated | The following table presents a reconciliation of gross profit used in the reportable segments as well as Corporate & Other and the Company's consolidated results (in thousands): Three Months Ended June 30, Nine Months Ended June 30, 2019 2018 2019 2018 Reconciliation: Gross profit $ 28,551 $ 27,144 $ 84,242 $ 84,855 Operating expenses 31,081 29,916 94,777 98,070 Other operating expenses 2,031 452 3,586 2,222 Interest and other income, net (454 ) (131 ) (1,224 ) (1,041 ) Provision (benefit) for income taxes 542 612 1,136 (3,824 ) Net loss $ (4,649 ) $ (3,705 ) $ (14,033 ) $ (10,572 ) |
Organization (Details)
Organization (Details) $ in Millions | Jul. 10, 2018USD ($) | Jun. 30, 2019reportablesegmentcategories |
Business Acquisition [Line Items] | ||
Number of product categories offered | categories | 500 | |
Reportable segments (in segments) | reportablesegment | 4 | |
Machinio | ||
Business Acquisition [Line Items] | ||
Percentage of voting interest acquired | 100.00% | |
Cash consideration | $ 16.7 | |
Equity consideration | 2 | |
Contingent consideration | $ 5 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Performance Obligations (Details) - Machinio - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-07-01 $ in Millions | Jun. 30, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation | $ 3.2 |
Remaining performance obligation, period | 1 year |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Narrative (Details) | Sep. 30, 2015USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)contract | Jun. 30, 2018USD ($) | Oct. 01, 2018USD ($) |
Business Acquisition [Line Items] | ||||||
Contract asset | $ 400,000 | $ 400,000 | $ 700,000 | |||
Contract liability | 3,200,000 | 3,200,000 | 2,100,000 | |||
Contract liability recognized as revenue | 1,900,000 | |||||
Decrease in general and administrative expense from reclassification | (8,959,000) | $ (6,847,000) | (26,217,000) | $ (22,056,000) | ||
Increase in interest and other income, net | $ 454,000 | $ 131,000 | $ 1,224,000 | $ 1,041,000 | ||
Government Contracts Concentration Risk | ||||||
Business Acquisition [Line Items] | ||||||
Number of contracts | contract | 2 | |||||
Government Contracts Concentration Risk | Scrap Contract | ||||||
Business Acquisition [Line Items] | ||||||
Number of contracts | contract | 1 | |||||
Government Contracts Concentration Risk | Sales Revenue | Scrap Contract | ||||||
Business Acquisition [Line Items] | ||||||
Concentration risk (as a percentage) | 8.20% | 12.10% | 7.80% | 10.00% | ||
Supplier Concentration Risk | Cost of Goods | Contract With Commercial Client | ||||||
Business Acquisition [Line Items] | ||||||
Concentration risk (as a percentage) | 41.60% | 41.00% | 43.90% | 28.50% | ||
Tanager Acquisitions Promissory Note | ||||||
Business Acquisition [Line Items] | ||||||
Receivable with imputed interest, face amount | $ 12,300,000 | |||||
Receivable with imputed interest, term | 5 years | |||||
Proceeds from collection of notes receivable | $ 4,000,000 | |||||
Receivable with imputed interest, net amount | $ 8,300,000 | 8,300,000 | ||||
Tanager Acquisitions Promissory Note | Prepaid Expenses and Other Current Assets | ||||||
Business Acquisition [Line Items] | ||||||
Receivable with imputed interest, net amount | 2,000,000 | 2,000,000 | ||||
Tanager Acquisitions Promissory Note | Other Assets | ||||||
Business Acquisition [Line Items] | ||||||
Receivable with imputed interest, net amount | 6,300,000 | 6,300,000 | ||||
Prepaid Expenses and Other Current Assets | ||||||
Business Acquisition [Line Items] | ||||||
Contract costs | $ 400,000 | $ 400,000 | $ 100,000 | |||
Accounting Standards Update 2017-07 | ||||||
Business Acquisition [Line Items] | ||||||
Decrease in general and administrative expense from reclassification | $ 84,000 | $ 265,000 | ||||
Increase in interest and other income, net | $ 84,000 | $ 265,000 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - ASC 606 (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Oct. 01, 2018 | Sep. 30, 2018 | |
Consolidated balance sheet: | ||||||
Prepaid expenses and other current assets | $ 8,129 | $ 8,129 | $ 8,487 | $ 7,816 | ||
Other assets | 14,299 | 14,299 | 14,183 | 14,124 | ||
Accumulated deficit | (113,348) | (113,348) | (99,315) | $ (100,045) | ||
Consolidated statement of operations: | ||||||
Total revenue | 56,882 | $ 50,569 | 167,735 | $ 171,809 | ||
ASC 606 | Balance without adoption of ASC 606 | ||||||
Consolidated balance sheet: | ||||||
Prepaid expenses and other current assets | 7,603 | 7,603 | ||||
Other assets | 14,026 | 14,026 | ||||
Accumulated deficit | (112,549) | (112,549) | ||||
ASC 606 | Effect of change | ||||||
Consolidated balance sheet: | ||||||
Prepaid expenses and other current assets | 526 | 526 | 671 | |||
Other assets | 273 | 273 | 59 | |||
Accumulated deficit | (799) | (799) | $ 730 | |||
Fee revenue | ||||||
Consolidated statement of operations: | ||||||
Total revenue | 20,494 | $ 18,489 | 58,257 | $ 56,345 | ||
Fee revenue | Balance without adoption of ASC 606 | ||||||
Consolidated statement of operations: | ||||||
Total revenue | 20,801 | 58,558 | ||||
Fee revenue | ASC 606 | Effect of change | ||||||
Consolidated statement of operations: | ||||||
Total revenue | $ (307) | $ (301) |
Significant Contracts (Details)
Significant Contracts (Details) | Oct. 11, 2017contract | Jun. 30, 2019option | Jun. 30, 2018 | Dec. 31, 2016 | Jun. 30, 2019optioncontract | Jun. 30, 2018 |
Government Contracts Concentration Risk | ||||||
Significant Contracts | ||||||
Number of contracts | 2 | |||||
Scrap Contract | ||||||
Significant Contracts | ||||||
Term of contract | 36 months | |||||
Number of extensions | option | 2 | 2 | ||||
Term of each renewal options extended | 12 months | |||||
Adjusted percentage of profit sharing distribution | 64.50% | |||||
Scrap Contract | Government Contracts Concentration Risk | ||||||
Significant Contracts | ||||||
Number of contracts | 1 | |||||
Scrap Contract | Government Contracts Concentration Risk | Sales Revenue | ||||||
Significant Contracts | ||||||
Concentration risk (as a percentage) | 8.20% | 12.10% | 7.80% | 10.00% | ||
Surplus Contract | ||||||
Significant Contracts | ||||||
Number of contracts | 2 | |||||
Surplus Contract | Government Contracts Concentration Risk | Sales Revenue | ||||||
Significant Contracts | ||||||
Concentration risk (as a percentage) | 0.00% | 0.20% | 0.00% | 16.20% | ||
Non-rolling stock | Surplus Contract | ||||||
Significant Contracts | ||||||
Usable surplus property to be purchased as a fixed percentage of DoD's original acquisition value | 4.35% |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Sep. 30, 2018 | |
Goodwill | ||
Balance at the beginning of the period | $ 59,819 | $ 45,388 |
Business acquisition | 14,558 | |
Translation adjustments | (134) | (127) |
Balance at the end of the period | 59,685 | 59,819 |
CAG | ||
Goodwill | ||
Balance at the beginning of the period | 21,530 | 21,657 |
Business acquisition | 0 | |
Translation adjustments | (134) | (127) |
Balance at the end of the period | 21,396 | 21,530 |
GovDeals | ||
Goodwill | ||
Balance at the beginning of the period | 23,731 | 23,731 |
Business acquisition | 0 | |
Translation adjustments | 0 | 0 |
Balance at the end of the period | 23,731 | 23,731 |
Machinio | ||
Goodwill | ||
Balance at the beginning of the period | 14,558 | 0 |
Business acquisition | 14,558 | |
Translation adjustments | 0 | 0 |
Balance at the end of the period | $ 14,558 | $ 14,558 |
Intangible Assets - Carrying Am
Intangible Assets - Carrying Amount (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Sep. 30, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 8,146 | $ 8,069 |
Accumulated Amortization | (1,769) | (703) |
Total | $ 6,377 | 7,366 |
Contract intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (in years) | 6 years | |
Gross Carrying Amount | $ 3,100 | 3,100 |
Accumulated Amortization | (516) | (129) |
Total | $ 2,584 | 2,971 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (in years) | 5 years | |
Gross Carrying Amount | $ 2,700 | 2,700 |
Accumulated Amortization | (540) | (135) |
Total | 2,160 | 2,565 |
Patent and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,346 | 2,269 |
Accumulated Amortization | (713) | (439) |
Total | $ 1,633 | $ 1,830 |
Minimum | Patent and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (in years) | 3 years | |
Maximum | Patent and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful Life (in years) | 10 years |
Intangible Assets - Amortizatio
Intangible Assets - Amortization (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Sep. 30, 2018 |
Future expected amortization of intangible assets | ||
Remaining three months of 2019 | $ 336 | |
2020 | 1,342 | |
2021 | 1,334 | |
2022 | 1,321 | |
2023 | 1,177 | |
2024 and thereafter | 867 | |
Total | $ 6,377 | $ 7,366 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Finite-Lived Intangible Assets, Net [Abstract] | ||||
Amortization of intangible assets | $ 336 | $ 20 | $ 1,010 | $ 100 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |||
Blended effective tax rate (as a percentage) | 24.50% | ||
Tax benefit relating to adjustment in corporate tax rate | $ 10.7 | ||
Expected effective tax rate (as a percent) | (7.90%) | (7.90%) | |
Discrete tax items | $ 0.1 | ||
Unrecognized tax benefits, foreign tax exposure | $ 0.1 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Oct. 01, 2018 | Oct. 01, 2017 | |
Increase (Decrease) in Stockholders' Equity | ||||||||||
Balance | $ 124,465 | $ 126,499 | $ 129,654 | $ 128,137 | $ 132,522 | $ 132,636 | $ 129,654 | $ 132,636 | ||
Cumulative adjustment related to adoption of ASU 2016-09 | $ 730 | $ (107) | ||||||||
Net loss | (4,649) | (4,362) | (5,022) | (3,705) | (5,655) | (1,212) | (14,033) | (10,572) | ||
Exercise of common stock options and vesting of restricted stock | 5 | 116 | 8 | 0 | 12 | 0 | ||||
Compensation expense from grants of common stock options and restricted stock | 1,477 | 1,212 | 1,262 | |||||||
Foreign currency translation and other | (588) | 46 | (57) | |||||||
Balance | $ 121,113 | $ 124,465 | $ 126,499 | $ 125,321 | $ 128,137 | $ 132,522 | $ 121,113 | $ 125,321 | ||
Common Stock | ||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Balance (in shares) | 33,347,657 | 33,183,178 | 32,774,118 | 31,993,077 | 31,889,679 | 31,503,349 | 32,774,118 | 31,503,349 | ||
Balance | $ 33 | $ 33 | $ 33 | $ 29 | $ 29 | $ 29 | $ 33 | $ 29 | ||
Exercise of common stock options and vesting of restricted stock (in shares) | 150,421 | 197,642 | 409,060 | 116,654 | 103,398 | 386,330 | ||||
Exercise of common stock options and vesting of restricted stock | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Balance (in shares) | 33,498,078 | 33,347,657 | 33,183,178 | 32,109,731 | 31,993,077 | 31,889,679 | 33,498,078 | 32,109,731 | ||
Balance | $ 33 | $ 33 | $ 33 | $ 29 | $ 29 | $ 29 | $ 33 | $ 29 | ||
Additional Paid-in Capital | ||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Balance | 239,806 | 237,679 | 236,115 | 229,850 | 228,626 | 227,264 | 236,115 | 227,264 | ||
Cumulative adjustment related to adoption of ASU 2016-09 | 100 | |||||||||
Exercise of common stock options and vesting of restricted stock | 5 | 116 | 8 | 12 | ||||||
Compensation expense from grants of common stock options and restricted stock | 1,477 | 1,212 | 1,262 | |||||||
Balance | 241,361 | 239,806 | 237,679 | 231,327 | 229,850 | 228,626 | 241,361 | 231,327 | ||
Accumulated Other Comprehensive Loss | ||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Balance | (6,678) | (6,876) | (6,449) | (6,448) | (6,482) | (6,431) | (6,449) | (6,431) | ||
Foreign currency translation and other | (747) | 34 | (51) | |||||||
Balance | (6,933) | (6,678) | (6,876) | (7,195) | (6,448) | (6,482) | (6,933) | (7,195) | ||
Accumulated Deficit | ||||||||||
Increase (Decrease) in Stockholders' Equity | ||||||||||
Balance | (108,696) | (104,337) | (100,045) | (95,294) | (89,651) | (88,226) | (100,045) | (88,226) | ||
Cumulative adjustment related to adoption of ASU 2016-09 | $ 730 | $ (207) | ||||||||
Net loss | (4,362) | (5,022) | (3,705) | (5,655) | (1,212) | |||||
Foreign currency translation and other | 159 | 12 | (6) | |||||||
Balance | $ (113,348) | $ (108,696) | $ (104,337) | $ (98,840) | $ (95,294) | $ (89,651) | $ (113,348) | $ (98,840) |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 23, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Sep. 30, 2016 |
Stockholders' Equity | |||||||
Shares available for issuance (in shares) | 16,300,000 | 13,000,000 | |||||
Increase in shares available for issuance (in shares) | 3,300,000 | ||||||
Reserve shares counted per share granted from fungible share pool (in shares) | 1.5 | ||||||
Stock-based compensation expense | $ 5,140 | ||||||
Shares repurchased (in shares) | 0 | 0 | |||||
Amount yet to be expended under the program | $ 10,100 | $ 10,100 | $ 10,100 | ||||
Options or stock appreciation rights | Maximum | |||||||
Stockholders' Equity | |||||||
Number of shares awarded per person per year (in shares) | 1,000,000 | ||||||
Other than options or stock appreciation rights | Maximum | |||||||
Stockholders' Equity | |||||||
Number of shares awarded per person per year (in shares) | 700,000 | ||||||
Employee Stock Option and Restricted Stock | |||||||
Stockholders' Equity | |||||||
Stock-based compensation expense | $ 5,120 | ||||||
Employee Stock Option | |||||||
Stockholders' Equity | |||||||
Shares and options vesting period | 4 years | ||||||
Restricted Stock | |||||||
Stockholders' Equity | |||||||
Shares and options vesting period | 4 years | ||||||
Employee Stock Option - Market-Based | |||||||
Stockholders' Equity | |||||||
Shares and options vesting period | 4 years | ||||||
Employee and director options | |||||||
Stockholders' Equity | |||||||
Expected volatility, minimum (as a percent) | 49.71% | ||||||
Expected volatility, maximum (as a percent) | 54.93% | ||||||
Dividend yield (as a percent) | 0.00% | ||||||
Risk free interest rate, minimum (as a percent) | 1.65% | ||||||
Risk free interest rate, maximum (as a percent) | 2.78% | ||||||
Employee and director options | Minimum | |||||||
Stockholders' Equity | |||||||
Shares and options vesting period | 1 year | ||||||
Employee and director options | Maximum | |||||||
Stockholders' Equity | |||||||
Shares and options vesting period | 4 years | ||||||
Cash-settled stock appreciation rights | |||||||
Stockholders' Equity | |||||||
Stock-based compensation expense | $ 20 | ||||||
Shares and options vesting period | 4 years | ||||||
Shares issued (in shares) | 0 | 0 | 95,000 | 0 | |||
Granted (USD per share) | $ 6.11 | ||||||
Exercised (in shares) | 7,954 | 4,082 | 109,124 | 87,084 | |||
Forfeited (in shares) | 15,273 | 85,756 | 403,321 | 358,660 | |||
Outstanding (in shares) | 516,760 | 1,007,889 | 516,760 | 1,007,889 | 516,760 |
Stockholders' Equity - 2006 Pla
Stockholders' Equity - 2006 Plan Activity (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Employee Stock Option - Time Based | ||||
Stock options: | ||||
Options granted (in shares) | 70,100 | 0 | 563,066 | 233,346 |
Weighted average grant date fair value (USD per share) | $ 2.87 | $ 0 | $ 2.71 | $ 2 |
Employee Stock Option - Market-Based and Performance-Based | ||||
Stock options: | ||||
Options granted (in shares) | 70,100 | 0 | 551,250 | 318,780 |
Weighted average grant date fair value (USD per share) | $ 2.87 | $ 0 | $ 2.69 | $ 1.59 |
Restricted Stock - Time Based | ||||
Restricted stock: | ||||
Restricted shares granted (in shares) | 48,400 | 20,000 | 250,128 | 271,221 |
Weighted average grant date fair value (USD per share) | $ 6.58 | $ 6.50 | $ 6.72 | $ 6.64 |
Restricted Stock - Market Based and Performance-Based | ||||
Restricted stock: | ||||
Restricted shares granted (in shares) | 48,400 | 0 | 178,600 | 246,340 |
Weighted average grant date fair value (USD per share) | $ 4.56 | $ 0 | $ 5.36 | $ 6.53 |
Fair Value Measurement - Narrat
Fair Value Measurement - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Sep. 30, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Certificates of deposits | $ 30 | $ 20 |
Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate | 2.50% | 2.50% |
Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate | 2.60% | 2.60% |
Fair Value Measurement - Change
Fair Value Measurement - Change in Level 3 Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Change in fair value | $ 0 | $ (90) |
Recurring basis | Level 3 Assets | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance, contingent consideration | 1,300 | |
Settlements | 0 | |
Change in fair value | 2,300 | |
Ending balance, contingent consideration | $ 3,600 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance, financial instruments | 491 | |
Settlements | (401) | |
Change in fair value | (90) | |
Ending balance, financial instruments | $ 0 |
Defined Benefit Pension Plan (D
Defined Benefit Pension Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Retirement Benefits [Abstract] | ||||
Service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 136 | 158 | 446 | 493 |
Expected return on plan assets | (222) | (242) | (695) | (750) |
Settlement cost | 0 | 0 | 0 | (8) |
Total net periodic (benefit) | $ (86) | $ (84) | $ (249) | $ (265) |
Guarantees (Details)
Guarantees (Details) | Mar. 31, 2015GBP (£) |
Guarantees [Abstract] | |
Guarantee obligation value, maximum | £ 10,000,000 |
Business Realignment Expenses -
Business Realignment Expenses - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring reserve | $ 549 | $ 3,180 | $ 549 | $ 1,376 | $ 3,180 | |||
Restructuring charges | 1,373 | $ 249 | 1,728 | $ 2,073 | 1,942 | |||
District of Columbia | Other Operating Expense | Office Building | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Loss on contract termination | 100 | 800 | 2,000 | |||||
Payment on contract loss termination | 700 | |||||||
Employee Severance | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | 1,100 | |||||||
Restructuring reserve | 248 | 1,192 | 248 | 110 | 1,192 | |||
Restructuring charges | 1,373 | 8 | 1,543 | 1,363 | 1,451 | |||
Employee Severance | Corporate & Other | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | 500 | |||||||
Restructuring reserve | 0 | 399 | 0 | 21 | 399 | |||
Restructuring charges | 1,125 | (12) | 1,295 | 463 | 472 | |||
CAG | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | 1,000 | 1,500 | 1,700 | |||||
CAG | Employee Severance | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring reserve | 248 | $ 793 | 248 | 89 | $ 793 | |||
Restructuring charges | 248 | $ 20 | 248 | 900 | 979 | |||
CAG | Employee Severance | Severance Agreement | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | $ 1,000 | |||||||
CAG | Occupancy Cost | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring reserve | 300 | $ 300 | ||||||
IronDirect | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring charges | $ 1,100 | |||||||
IronDirect | Employee Severance | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | $ 200 | |||||||
Scrap Contract | Employee Severance | ||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||
Restructuring costs | $ 200 |
Business Realignment Expenses_2
Business Realignment Expenses - Business Realignment Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | $ 1,373 | $ 249 | $ 1,728 | $ 2,073 | $ 1,942 |
Employee severance and benefit costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | 1,373 | 8 | 1,543 | 1,363 | 1,451 |
Occupancy and other costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | 0 | 241 | 185 | 710 | 491 |
CAG | Employee severance and benefit costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | 248 | 20 | 248 | 900 | 979 |
CAG | Occupancy and other costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | 0 | 241 | 51 | 675 | 739 |
Corporate & Other | Employee severance and benefit costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | 1,125 | (12) | 1,295 | 463 | 472 |
Corporate & Other | Occupancy and other costs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Business Realignment Expenses | $ 0 | $ 0 | $ 134 | $ 35 | $ (248) |
Business Realignment Expenses_3
Business Realignment Expenses - Restructuring Related Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Sep. 30, 2018 | |
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | $ 1,376 | $ 3,180 | $ 3,180 | ||
Business Realignment Expenses | $ 1,373 | $ 249 | 1,728 | 2,073 | 1,942 |
Cash Payments | (2,555) | (3,746) | |||
Ending balance | 549 | 549 | 1,376 | ||
Employee severance and benefit costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 110 | 1,192 | 1,192 | ||
Business Realignment Expenses | 1,373 | 8 | 1,543 | 1,363 | 1,451 |
Cash Payments | (1,405) | (2,533) | |||
Ending balance | 248 | 248 | 110 | ||
Occupancy and other costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 1,266 | 1,988 | 1,988 | ||
Business Realignment Expenses | 0 | 241 | 185 | 710 | 491 |
Cash Payments | (1,150) | (1,213) | |||
Ending balance | 301 | 301 | 1,266 | ||
Corporate & Other | Employee severance and benefit costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 21 | 399 | 399 | ||
Business Realignment Expenses | 1,125 | (12) | 1,295 | 463 | 472 |
Cash Payments | (1,316) | (850) | |||
Ending balance | 0 | 0 | 21 | ||
Corporate & Other | Occupancy and other costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 807 | 1,988 | 1,988 | ||
Business Realignment Expenses | 0 | 0 | 134 | 35 | (248) |
Cash Payments | (843) | (933) | |||
Ending balance | 98 | 98 | 807 | ||
CAG | Employee severance and benefit costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 89 | 793 | 793 | ||
Business Realignment Expenses | 248 | 20 | 248 | 900 | 979 |
Cash Payments | (89) | (1,683) | |||
Ending balance | 248 | 248 | 89 | ||
CAG | Occupancy and other costs | |||||
Restructuring Reserve [Roll Forward] | |||||
Beginning balance | 459 | 0 | 0 | ||
Business Realignment Expenses | 0 | $ 241 | 51 | $ 675 | 739 |
Cash Payments | (307) | (280) | |||
Ending balance | $ 203 | $ 203 | $ 459 |
Legal Proceedings and Other C_2
Legal Proceedings and Other Contingencies (Details) $ in Millions | Jun. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Estimate of possible loss | $ 0.6 |
Segment Information - Narrative
Segment Information - Narrative (Details) - reportablesegment | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Revenue, Major Customer [Line Items] | ||||
Reportable segments (in segments) | 4 | |||
Segments percentage of revenue (as a percentage) | 99.00% | |||
Non-US | Sales Revenue | Geographic Concentration Risk | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk (as a percentage) | 13.60% | 11.10% | 14.90% | 12.20% |
Segment Information - Reconcili
Segment Information - Reconciliation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||||||
Total revenue | $ 56,882 | $ 50,569 | $ 167,735 | $ 171,809 | ||||
Gross profit | 28,551 | 27,144 | 84,242 | 84,855 | ||||
Operating expenses | 31,081 | 29,916 | 94,777 | 98,070 | ||||
Other operating expenses | 2,031 | 452 | 3,586 | 2,222 | ||||
Interest and other income, net | (454) | (131) | (1,224) | (1,041) | ||||
Provision (benefit) for income taxes | 542 | 612 | 1,136 | (3,824) | ||||
Net loss | (4,649) | $ (4,362) | $ (5,022) | (3,705) | $ (5,655) | $ (1,212) | (14,033) | (10,572) |
Operating Segments | GovDeals | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 9,280 | 8,421 | 24,635 | 22,554 | ||||
Gross profit | 8,560 | 7,795 | 22,663 | 20,927 | ||||
Operating Segments | CAG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 14,890 | 15,011 | 44,056 | 72,230 | ||||
Gross profit | 7,759 | 9,911 | 25,255 | 39,973 | ||||
Operating Segments | RSCG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 31,261 | 26,343 | 94,750 | 73,742 | ||||
Gross profit | 10,874 | 9,305 | 32,710 | 24,649 | ||||
Operating Segments | Machinio | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 1,451 | 0 | 3,816 | 0 | ||||
Gross profit | 1,358 | 0 | 3,501 | 0 | ||||
Corporate & Other | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 0 | 794 | 478 | 3,283 | ||||
Gross profit | 0 | 133 | 113 | (694) | ||||
Revenue | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 36,388 | 32,080 | 109,478 | 115,464 | ||||
Revenue | Operating Segments | GovDeals | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 0 | 0 | 0 | 0 | ||||
Revenue | Operating Segments | CAG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 9,377 | 8,341 | 26,105 | 49,164 | ||||
Revenue | Operating Segments | RSCG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 27,011 | 22,952 | 82,904 | 63,027 | ||||
Revenue | Operating Segments | Machinio | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 0 | 0 | 0 | 0 | ||||
Revenue | Corporate & Other | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 0 | 787 | 469 | 3,273 | ||||
Fee revenue | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 20,494 | 18,489 | 58,257 | 56,345 | ||||
Fee revenue | Operating Segments | GovDeals | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 9,280 | 8,421 | 24,635 | 22,554 | ||||
Fee revenue | Operating Segments | CAG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 5,513 | 6,670 | 17,951 | 23,066 | ||||
Fee revenue | Operating Segments | RSCG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 4,250 | 3,391 | 11,846 | 10,715 | ||||
Fee revenue | Operating Segments | Machinio | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | 1,451 | 0 | 3,816 | 0 | ||||
Fee revenue | Corporate & Other | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Total revenue | $ 0 | $ 7 | $ 9 | $ 10 |