Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 03, 2015 | Jun. 30, 2014 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | ZAGG Inc | ||
Entity Central Index Key | 1296205 | ||
Trading Symbol | zagg | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | -19 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Common Stock, Shares Outstanding | 29,457,365 | ||
Entity Public Float | $125,589,981 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2014 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets | ||
Cash and cash equivalents | $9,461 | $15,031 |
Accounts receivable, net of allowances of $1,910 in 2014 and $2,540 in 2013 | 75,729 | 46,591 |
Inventories | 48,378 | 44,539 |
Prepaid expenses and other current assets | 2,681 | 2,403 |
Deferred income tax assets | 10,774 | 7,917 |
Total current assets | 147,023 | 116,481 |
Property and equipment, net of accumulated depreciation at $7,659 in 2014 and $5,778 in 2013 | 7,300 | 5,004 |
Intangible assets, net of accumulated amortization at $33,242 in 2014 and $23,431 in 2013 | 31,408 | 41,219 |
Deferred income tax assets | 14,290 | 11,377 |
Note receivable | 801 | 801 |
Other assets | 457 | 588 |
Total assets | 201,279 | 175,470 |
Current liabilities | ||
Accounts payable | 49,379 | 15,207 |
Income taxes payable | 6,464 | 6,359 |
Accrued liabilities | 6,910 | 2,608 |
Accrued wages and wage related expenses | 2,600 | 891 |
Deferred revenue | 179 | 159 |
Sales returns liability | 8,674 | 7,872 |
Total current liabilities | 74,206 | 33,096 |
Revolving line of credit | 17,543 | |
Total liabilities | 74,206 | 50,639 |
Stockholders' equity | ||
Common stock, $0.001 par value; 100,000 shares authorized; 32,686 and 32,331 shares issued in 2014 and 2013, respectively | 33 | 32 |
Additional paid-in capital | 85,154 | 82,807 |
Accumulated other comprehensive income (loss) | -895 | 93 |
Note receivable collateralized by stock | -348 | -348 |
Treasury stock, 3,569 and 1,756 common shares in 2014 and 2013 respectively, at cost | -19,576 | -9,997 |
Retained earnings | 62,705 | 52,244 |
Total stockholders' equity | 127,073 | 124,831 |
Total liabilities and stockholders' equity | $201,279 | $175,470 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parentheticals) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Balance Sheets [Abstract] | ||
Allowances for doubtful accounts | $1,910 | $2,540 |
Accumulated depreciation on property and equipment | 7,659 | 5,778 |
Accumulated amortization on Intangible assets | $33,242 | $23,431 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 32,686 | 32,331 |
Treasury stock | 3,569 | 1,756 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Operations [Abstract] | |||
Net sales | $261,585 | $219,356 | $264,425 |
Cost of sales | 178,241 | 132,236 | 143,880 |
Gross profit | 83,344 | 87,120 | 120,545 |
Operating expenses: | |||
Advertising and marketing | 7,542 | 8,952 | 12,495 |
Selling, general and administrative | 49,110 | 46,356 | 53,330 |
Impairment of goodwill and intangibles | 11,246 | 11,497 | |
Amortization of definite-lived intangibles | 9,709 | 9,620 | 9,732 |
Total operating expenses | 66,361 | 76,174 | 87,054 |
Income from operations | 16,983 | 10,946 | 33,491 |
Other income (expense): | |||
Interest expense | -170 | -575 | -6,321 |
Loss from equity method investment in HzO | -2,013 | -2,866 | |
Other income and (expense) | 121 | 127 | -406 |
Total other expense | -49 | -2,461 | -9,593 |
Income before provision for income taxes | 16,934 | 8,485 | 23,898 |
Income tax provision | -6,473 | -3,695 | -9,393 |
Net income | $10,461 | $4,790 | $14,505 |
Earnings per share attributable to stockholders: | |||
Basic earnings per share | $0.35 | $0.16 | $0.48 |
Diluted earnings per share | $0.34 | $0.15 | $0.46 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement Of Other Comprehensive Income [Abstract] | |||
Net income | $10,461 | $4,790 | $14,505 |
Other comprehenseive income (loss), net of tax: | |||
Foreign currency translation gain (loss) | -988 | 150 | -24 |
Total other comprehensive income (loss) | -988 | 150 | -24 |
Comprehensive income | $9,473 | $4,940 | $14,481 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statement of Stockholders' Equity (USD $) | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Notes Receivable Collateralized By Stock | Treasury Stock | Retained Earnings |
In Thousands | |||||||
Balances at Dec. 31, 2011 | $102,628 | $30 | $70,248 | ($33) | ($566) | $32,949 | |
Balances, Shares at Dec. 31, 2011 | 29,782 | ||||||
Net loss | 14,505 | 14,505 | |||||
Other comprehensive loss | -24 | -24 | |||||
Warrant exercises | 296 | 1 | 295 | ||||
Warrant exercises (in shares) | 556 | ||||||
Option exercises | 599 | 599 | |||||
Option exercises (in shares) | 495 | ||||||
Restricted stock release | |||||||
Restricted stock release (in shares) | 382 | ||||||
Option expense | 1,008 | 1,008 | |||||
Warrant grant expense | 311 | 311 | |||||
Restricted stock expense | 4,191 | 4,191 | |||||
Stock-based compensation expense | 5,707 | ||||||
Tax shortfall related to share - based payments | 582 | 582 | |||||
Balances at Dec. 31, 2012 | 124,096 | 31 | 77,234 | -57 | -566 | 47,454 | |
Balances, Shares at Dec. 31, 2012 | 31,215 | ||||||
Net loss | 4,790 | 4,790 | |||||
Other comprehensive loss | 150 | 150 | |||||
Purchase of shares of treasury stock | -9,997 | -9,997 | |||||
Consideration for acquisition of patent | 1,946 | 1 | 1,945 | ||||
Consideration for acquisition of patent (in shares) | 500 | ||||||
Option exercises | 270 | 270 | |||||
Option exercises (in shares) | 135 | ||||||
Restricted stock release | |||||||
Restricted stock release (in shares) | 481 | ||||||
Option expense | 280 | 280 | |||||
Warrant grant expense | |||||||
Restricted stock expense | 3,589 | 3,589 | |||||
Stock-based compensation expense | 4,126 | ||||||
Tax shortfall related to share - based payments | -511 | -511 | |||||
Reclassification of note receivable collateralized by stock | 218 | 218 | |||||
Balances at Dec. 31, 2013 | 124,831 | 32 | 82,807 | 93 | -348 | -9,997 | 52,244 |
Balances, Shares at Dec. 31, 2013 | 32,331 | ||||||
Net loss | 10,461 | 10,461 | |||||
Other comprehensive loss | -988 | -988 | |||||
Purchase of shares of treasury stock | -9,579 | -9,579 | |||||
Consideration for acquisition of patent | |||||||
Warrant exercises | |||||||
Warrant exercises (in shares) | 3 | ||||||
Option exercises | 265 | 265 | |||||
Option exercises (in shares) | 148 | ||||||
Restricted stock release | 1 | 1 | |||||
Restricted stock release (in shares) | 204 | ||||||
Warrant grant expense | |||||||
Stock-based compensation expense | 2,173 | 2,173 | |||||
Tax shortfall related to share - based payments | -91 | -91 | |||||
Reclassification of note receivable collateralized by stock | 0 | ||||||
Balances at Dec. 31, 2014 | $127,073 | $33 | $85,154 | ($895) | ($348) | ($19,576) | $62,705 |
Balances, Shares at Dec. 31, 2014 | 32,686 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statement of Stockholders' Equity (Parentheticals) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Treasury stock purchased (in shares) | 1,813 | 1,756 |
Treasury Stock [Member] | ||
Treasury stock purchased (in shares) | 1,813 | 1,756 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities | |||
Net income | $10,461 | $4,790 | $14,505 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Stock-based compensation | 2,173 | 4,126 | 5,707 |
Impairment of goodwill and intangibles | 11,246 | 11,497 | |
Impairment of investment | 591 | ||
Excess tax benefits related to share-based payments | -22 | -52 | -707 |
Depreciation and amortization | 12,899 | 12,157 | 11,559 |
Deferred income taxes | -5,770 | -5,787 | -8,293 |
Amortization of deferred loan costs | 66 | 120 | 708 |
Write-off of deferred loan costs | 27 | 1,509 | |
Expense related to issuance of warrants | 311 | ||
Loss on disposal of property and equipment | 313 | ||
Loss on investment in equity method investment | 2,013 | 2,866 | |
Changes in operating assets and liabilities | |||
Accounts receivable, net | -29,490 | 8,079 | -9,093 |
Inventories | -4,350 | -4,404 | -10,334 |
Prepaid expenses and other current assets | -421 | 7,335 | -7,600 |
Other assets | 160 | -11 | |
Accounts payable | 33,373 | -3,838 | 3,044 |
Income taxes payable | 13 | 2,787 | -656 |
Accrued liabilities | 4,616 | -1,557 | -262 |
Accrued wages and wage related expenses | 1,709 | -1,872 | 681 |
Deferred revenue | 21 | -564 | 403 |
Sales returns liability | 813 | 1,167 | 1,299 |
Net cash provided by operating activities | 26,251 | 36,364 | 17,446 |
Cash flows from investing activities | |||
Deposits on and purchase of intangible assets | -500 | -72 | |
Purchase of property and equipment | -4,430 | -2,588 | -2,764 |
Net cash used in investing activities | -4,430 | -3,088 | -2,836 |
Cash flows from financing activities | |||
Payment of debt issuance costs | -43 | -238 | |
Purchase of treasury stock | -9,579 | -9,997 | |
Proceeds from issuance of term note | 24,000 | ||
Proceeds from revolving credit facilities | 56,075 | 69,291 | 26,238 |
Payments on term note | -24,000 | -45,000 | |
Payments on revolving credit facilities | -73,618 | -73,921 | -27,396 |
Proceeds from exercise of warrants and options | 265 | 270 | 895 |
Excess tax benefits related to share-based payments | 22 | 52 | 707 |
Net cash used in financing activities | -26,835 | -38,348 | -20,794 |
Effect of foreign currency exchange rates on cash and cash equivalents | -556 | -74 | -72 |
Net decrease in cash and cash equivalents | -5,570 | -5,146 | -6,256 |
Cash and cash equivalents at beginning of the period | 15,031 | 20,177 | 26,433 |
Cash and cash equivalents at end of the period | 9,461 | 15,031 | 20,177 |
Supplemental disclosure of cash flow information | |||
Cash paid during the period for interest | 97 | 461 | 4,477 |
Cash paid during the period for taxes | 12,370 | 6,515 | 18,536 |
Supplemental schedule of noncash investing and financing activities | |||
Purchase of fixed assets | 975 | ||
Reclassification of note receivable to other asset | 218 | ||
Issued shares of common stock with a fair value | 500 | ||
Purchase of patent or intangible assets | 2,275 | ||
Consideration for acquisition of patent | 1,946 | ||
Consideration for acquisition of patent recorded within accrued liabilities | 1 | ||
Amount Financed to purchase of patent through accrued liabilities | 329 | ||
Foreclosure on real property | 250 | ||
Foreclosure on private company stock and warrants | $516 |
Organization_and_Summary_of_Si
Organization and Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | (1) ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||||||||||
The Company | |||||||||||||
Prior to March 2007, the Company was known as ShieldZone Corporation. However, at that time, the Company changed its name from ShieldZone Corporation to ZAGG Incorporated to better position the Company to become a large enterprise in the electronics’ accessories industry through organic growth and through making targeted acquisitions. The ShieldZone name was very specific to the screen protection product line, and although screen protection is a core product line, the name change has brought the Company the opportunity to easily add new products to its product offering. During 2011, the Company changed its name from ZAGG Incorporated to ZAGG Inc. | |||||||||||||
In June 2011, ZAGG acquired 100% of the outstanding shares of iFrogz, which further diversified the existing ZAGG product line, particularly for audio and protective case accessories. | |||||||||||||
The Company designs, produces, and distributes professional and premium creative product solutions including screen protection, keyboards for tablet computers and mobile devices, keyboard cases, earbuds, mobile power solutions, cables, and cases under the ZAGG and InvisibleShield brands. In addition, the Company designs, produces, and distributes earbuds, headphones, mobile power solutions, Bluetooth speakers, cases, and cables for mobile devices under the iFrogz brand in the fashion and youth oriented lifestyle sector. | |||||||||||||
Use of estimates | |||||||||||||
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates include the allowance for doubtful accounts, inventory reserve, sales returns liability, the useful life of property and equipment, the useful life of intangible assets, stock-based compensation, and income taxes. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate an adjustment is necessary. | |||||||||||||
Principles of consolidation | |||||||||||||
The consolidated financial statements include the accounts of ZAGG Inc and its wholly owned subsidiaries ZAGG International Distribution Limited (“ZAGG International”), Patriot Corporation, ZAGG Intellectual Property Holding Co, Inc., and ZAGG Retail, Inc. All intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||
At December 31, 2010, HzO, Inc. (“HzO”), a private company engaged in the development of water-blocking technologies for consumer and industrial applications, was consolidated by the Company as a variable interest entity (VIE). On December 22, 2011, HzO entered into an Amended Series B Stock Purchase Agreement with a group of third party investors. ZAGG considered this a reconsideration event and concluded that as of December 22, 2011, HzO should no longer be considered a VIE under authoritative accounting literature, but was considered a voting interest entity. Ultimately, management concluded that HzO should no longer be consolidated into the ZAGG financials as of December 31, 2011. From December 22, 2011 to the fourth quarter of 2013, management accounted for its investment in HzO as an equity method investment. However, during the fourth quarter of 2013, HzO received additional equity financing, in which ZAGG did not participate. As a result of the additional investment, ZAGG’s investment declined below 20% and the investment is now accounted for as a cost method investment. The carrying amount of the investment in HzO was $0 at December 31, 2014 and 2013. | |||||||||||||
Cash equivalents | |||||||||||||
The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. Amounts receivable from credit card processors are also considered cash equivalents because they are both short-term and highly liquid in nature and are typically converted to cash within three days of the sales transaction. Amounts receivable from credit card processors at December 31, 2014 and 2013 totaled $120 and $19, respectively. Cash equivalents as of December 31, 2014 and 2013, consisted primarily of money market fund investments and amounts receivable from credit card processors. | |||||||||||||
Fair value measurements | |||||||||||||
The Company measures at fair value certain financial and non-financial assets by using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability. The levels of the fair value hierarchy are: | |||||||||||||
Level 1 — Quoted market prices in active markets for identical assets or liabilities; | |||||||||||||
Level 2 — Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar items in markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs); and | |||||||||||||
Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting unit to develop its own assumptions. | |||||||||||||
Accounts receivable | |||||||||||||
The Company sells its products to end users through indirect distribution channels and other resellers who are extended credit terms after an analysis of their financial condition and credit worthiness. Credit terms to distributors and resellers, when extended, are based on evaluation of the customers’ financial condition. Accounts receivable are recorded at invoiced amounts and do not bear interest. | |||||||||||||
The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. Management regularly evaluates the allowance for doubtful accounts considering historical losses adjusted to take into account current market conditions, customers’ financial condition, receivables in dispute, receivables aging, and current payment patterns. Account balances are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Payments subsequently received on written off receivables are credited to bad debt expense in the period of recovery. | |||||||||||||
The following summarizes the activity in the Company’s allowance for doubtful accounts for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
For the Years Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 2,540 | $ | 2,974 | $ | 2,070 | |||||||
Additions charged to expense | 389 | 1,142 | 2,101 | ||||||||||
Write-offs charged against the allowance | (1,019 | ) | (1,576 | ) | (1,197 | ) | |||||||
Balance at end of year | $ | 1,910 | $ | 2,540 | $ | 2,974 | |||||||
Inventories | |||||||||||||
Inventories, consisting primarily of finished goods and raw materials, are valued at the lower of cost, determined on a first in, first out basis, or market. Management performs periodic assessments to determine the existence of obsolete, slow moving, and non-saleable inventories, and records necessary write downs in cost of sales to reduce such inventories to net realizable value. Once established, the original cost of the inventory less the related inventory write down represents the new cost basis of such products. | |||||||||||||
Property and equipment | |||||||||||||
Property and equipment are recorded at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the useful life of the asset or the term of the lease. | |||||||||||||
Major additions and improvements are capitalized, while costs for minor replacements, maintenance and repairs that do not increase the useful life of an asset are expensed as incurred. Upon retirement or other disposition of property and equipment, the cost and related accumulated depreciation or amortization are removed from the accounts. The resulting gain or loss is reflected in selling, general and administrative expense. | |||||||||||||
During the second quarter of 2014, the Company commenced a development project utilizing both internal and external developers to improve the www.ZAGG.com and www.iFrogz.com websites. The development project is intended to provide additional functionality to the websites and will transition the websites to an improved software platform. During the year ended December 31, 2014, the Company capitalized website development costs for internal and external developers totaling $859. These costs are included within property and equipment on the consolidated balance sheet. Depreciation of website development costs begins when the resulting website functionality is ready for its intended use and placed in service; as the project is still in the development stage, no depreciation has been recorded during 2014. Website development costs are included within computer equipment and software in Note 4. | |||||||||||||
Intangibles assets | |||||||||||||
Intangible assets include internet addresses, patents, intellectual property, and acquired intangibles in connection with the acquisition of iFrogz, which include customer relationships, trademarks, non-compete agreements, and other miscellaneous intangible assets. | |||||||||||||
Definite-lived intangible assets are amortized over their estimated economic lives, using a straight-line or accelerated method consistent with the underlying expected future cash flows related to the specific intangible asset. Amortization expense is recorded within cost of sales or operating expense depending on the underlying intangible assets. | |||||||||||||
Impairment of long-lived assets | |||||||||||||
Long-lived assets, such as property and equipment, and definite-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, recoverability of long-lived assets is measured by comparison of its carrying amount to the undiscounted cash flows that the asset or asset group is expected to generate over the remaining life in measuring whether the assets are recoverable. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. | |||||||||||||
Contingencies | |||||||||||||
Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. | |||||||||||||
Revenue recognition | |||||||||||||
The Company records revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The Company’s revenue is derived from sales of our products through our indirect channel, including retailers and distributors; through our direct channel, including www.ZAGG.com, www.iFrogz.com, and our corporate-owned and third-party-owned mall kiosks; and from the franchise fees derived from the onboarding of new franchisees. For product sales, our standard shipping terms are FOB shipping point, and we record revenue when the product is shipped, net of estimated returns and discounts. For some customers, the contractual shipping terms are FOB destination. For these shipments, we record revenue when the product is delivered, net of estimated returns and discounts. For franchise fees, we recognize revenue on a straight-line basis over the franchise term. The Company records revenue from royalty agreements in the period in which the royalty is earned. | |||||||||||||
Promotional products given to customers or potential customers are recognized as a cost of sales. Cash incentives provided to our customers are recognized as a reduction of the related sale price, and, therefore, are a reduction in sales. | |||||||||||||
Allowance for sales returns, warranty, and other credits | |||||||||||||
For product sales, the Company records revenue, net of estimated returns and discounts, when delivery has occurred, collection of the relevant receivable is reasonably assured, persuasive evidence of an arrangement exists and the sales price is fixed or determinable. Our return policy allows end users and certain retailers rights to return purchased products. In addition, the Company generally provides the ultimate consumer a warranty with each product. Due to the nature of the screen protection product line, end user returns for screen protection are generally not salvageable and are not included in inventory. We estimate a reserve for sales returns, warranty, and other credits, and record the estimated reserve amount as a reduction of sales, and as a sales return reserve liability. When product is returned and is expected to be resold, as is the case with returns of packaged screen protection, keyboards, audio products, cases, and power products, the reserve is recorded as a reduction of revenues and cost of sales, and as a sales return reserve liability. The sales returns and warranty reserve requires management to make estimates regarding return rates for sales and warranty returns. Historical experience, actual claims, and customer return rights are the key factors used in determining the estimated sales return and warranty reserve. | |||||||||||||
The following summarizes the activity in the Company’s sales return and warranty liability for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
For the Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 7,872 | $ | 6,697 | $ | 5,387 | |||||||
Additions charged to sales | 35,923 | 30,450 | 28,690 | ||||||||||
Sales returns & warranty claims charged against reserve | (35,121 | ) | (29,275 | ) | (27,380 | ) | |||||||
Balance at end of year | $ | 8,674 | $ | 7,872 | $ | 6,697 | |||||||
Income taxes | |||||||||||||
The Company recognizes deferred income tax assets or liabilities for expected future tax consequences of events that have been recognized in the financial statements or tax returns. Under this method, deferred income tax assets or liabilities are determined based upon the difference between the financial statement and income tax bases of assets and liabilities using enacted tax rates expected to apply when differences are expected to be settled or realized. Deferred income tax assets are reviewed for recoverability and valuation allowances are provided when it is more likely than not that a deferred tax asset will not be realizable in the future. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. | |||||||||||||
The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records estimated interest and penalties related to unrecognized tax benefits, if any, as a component of income tax provision. | |||||||||||||
The Company has foreign subsidiaries that conduct or support its business outside the United States. The Company does not provide for U.S. income taxes on undistributed earnings for its foreign subsidiaries as the foreign earnings will be permanently reinvested in such foreign jurisdictions. | |||||||||||||
Stock-based compensation | |||||||||||||
The Company recognizes stock-based compensation expense in its consolidated financial statements for awards granted to employees and non-employees, which include restricted stock, stock options, and warrants. Equity-classified awards are measured at the grant date fair value of the award. The fair value of restricted stock is measured on the grant date based on the quoted closing market price of the Company’s common stock. The fair value of the stock options is measured on the grant date using the Black-Scholes option pricing model based on the underlying common stock closing price as of the date of grant, the expected term, stock price volatility, and risk-free interest rates. The Company recognizes compensation expense net of estimated forfeitures on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the award. No compensation expense is ultimately recognized for awards for which employees do not render the requisite service and are forfeited. Excess tax benefits of awards that are recognized in equity related to stock option exercises are reflected as financing cash inflows. | |||||||||||||
Advertising and marketing | |||||||||||||
General advertising is expensed as incurred. Advertising allowances provided to retailers are recorded as an expense at the time of the related sale if the Company receives an identifiable benefit in exchange for the consideration and has evidence of fair value for the advertising; otherwise, the allowance is recorded as a reduction of revenue. Advertising expenses for the years ended December 31, 2014, 2013 and 2012 were $7,542, $8,952 and $12,495, respectively. | |||||||||||||
Foreign currency translation and transactions | |||||||||||||
The Company’s primary operations are at the parent level which uses the U.S. dollar (USD) as its functional currency. The Euro is the functional currency of the Company’s foreign subsidiaries. Accordingly, assets and liabilities for these subsidiaries are translated into USD using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as a component of stockholders’ equity. Gains and losses resulting from foreign currency transactions are included in income as a component of other income and (expense) in the consolidated statements of operations and totaled $149, ($7) and ($17) for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||
Earnings per share | |||||||||||||
Basic earnings per common share excludes dilution and is computed by dividing net income attributable to stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share reflects the potential dilution that could occur if stock options or other common stock equivalents were exercised or converted into common stock. The dilutive effect of stock options or other common stock equivalents is calculated using the treasury stock method. | |||||||||||||
The following is a reconciliation of the numerator and denominator used to calculate basic earnings per share and diluted earnings per share for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income attributable to stockholders | $ | 10,461 | $ | 4,790 | $ | 14,505 | |||||||
Weighted average shares outstanding | 30,247 | 30,900 | 30,339 | ||||||||||
Dilutive effect of stock options, restricted stock, and warrants | 363 | 559 | 1,317 | ||||||||||
Weighted average diluted shares | 30,610 | 31,459 | 31,656 | ||||||||||
Earnings per share attributable to stockholders: | |||||||||||||
Basic | $ | 0.35 | $ | 0.16 | $ | 0.48 | |||||||
Dilutive | $ | 0.34 | $ | 0.15 | $ | 0.46 | |||||||
For the years ended December 31, 2014, 2013, and 2012, restricted stock, warrants and stock options to purchase 485, 620, and 169 shares of common stock, respectively, were not considered in calculating diluted earnings per share because the warrant or stock option exercise prices or the total expected proceeds under the treasury stock method for the warrants, restricted stock, or stock options was greater than the average market price of common shares during the period and, therefore, the effect would be anti-dilutive. | |||||||||||||
Recent accounting pronouncements | |||||||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” This ASU includes a five-step process by which entities will recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration to which an entity expects to be entitled to in exchange for those goods or services. The ASU also will require enhanced disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption prohibited. We are currently evaluating the impact this ASU will have on our consolidated financial statements. | |||||||||||||
In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” This ASU describes how an entity should assess its ability to meet obligations and sets disclosure requirements for how this information should be disclosed in the financial statements. The standard provides accounting guidance that will be used with existing auditing standards. The ASU applies to all entities for the first annual period ending after December 15, 2016, and interim periods thereafter. This ASU is not expected to have a significant impact on the Company’s consolidated financial statements. | |||||||||||||
Inventories
Inventories | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Inventories [Abstract] | |||||||||
INVENTORIES | (2) INVENTORIES | ||||||||
Inventory consisted of the following components: | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 48,145 | $ | 40,992 | |||||
Raw materials | 233 | 3,547 | |||||||
Total inventory | $ | 48,378 | $ | 44,539 | |||||
Included in prepaid expenses and other current assets were inventory deposits with third-party manufacturers at December 31, 2014 and 2013 of $1,425 and $735, respectively. In addition, as of December 31, 2014, the Company made a commitment to purchase $455 in raw materials used in the production of certain keyboard products. The Company has entered into an agreement with a third party manufacturer to outsource production and logistics for certain products. Under the agreement, the Company may be required to purchase inventory units on hand at the supplier if certain circumstances occur. No obligation exists nor have any products been purchased as of December 31, 2014. |
Investment_in_HzO
Investment in HzO | 12 Months Ended |
Dec. 31, 2014 | |
Investment in HzO [Abstract] | |
INVESTMENT IN HzO | (3) INVESTMENT IN HzO |
HzO, Inc. (“HzO”) is a private company engaged in the development of water-blocking technologies for consumer and industrial electronics applications. Prior to the fourth quarter of 2013, the Company accounted for its investment in HzO under the equity method of accounting. However, due to an equity raise by HzO during the fourth quarter of 2013 that reduced ZAGG’s ownership percentage below 20%, the Company began accounting for the investment as a cost method investment. During the second quarter of 2014, HzO raised an additional $20,000 in equity capital. ZAGG did not participate in the capital raise. Due to this equity raise and 2014 option exercises at HzO, ZAGG’s ownership interest in HzO decreased from 15.3% at December 31, 2013 to 10.1% at December 31, 2014. | |
For the years ended December 31, 2014, 2013, and 2012, the Company recorded a loss from investment in HzO of $0, $2,013 and $2,866, respectively. The loss from investment in HzO was recorded as a component of other income (expense) in the consolidated statement of operations in each respective period. The carrying value of the investment at December 31, 2014 and 2013 was $0 due to the accumulated losses. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Property and Equipment [Abstract] | |||||||||||||
PROPERTY AND EQUIPMENT | (4) PROPERTY AND EQUIPMENT | ||||||||||||
Property and equipment consisted of the following: | |||||||||||||
December 31, | |||||||||||||
2014 | 2013 | ||||||||||||
Useful Lives | |||||||||||||
Computer equipment and software | 3 to 5 years | $ | 2,627 | $ | 1,519 | ||||||||
Equipment and molds | 3 to 10 years | 8,238 | 5,173 | ||||||||||
Furniture and fixtures | 7 years | 770 | 778 | ||||||||||
Automobiles | 5 years | 234 | 201 | ||||||||||
Leasehold improvements | 1 to 4.75 years | 3,090 | 3,111 | ||||||||||
14,959 | 10,782 | ||||||||||||
Less accumulated depreciation | (7,659 | ) | (5,778 | ) | |||||||||
Net property and equipment | $ | 7,300 | $ | 5,004 |
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Goodwill and Intangible Assets [Abstract] | |||||||||||||||||||||||||
GOODWILL AND INTANGIBLE ASSETS | (5) GOODWILL AND INTANGIBLE ASSETS | ||||||||||||||||||||||||
Impairment of Goodwill | |||||||||||||||||||||||||
For the years ended December 31, 2013 and 2012, the Company recorded impairments of goodwill in the amounts of $1,484 and $5,441, respectively, when it was determined that the carrying value of goodwill exceeded its fair value. The determination was made during the impairment analyses performed during the fourth quarters of 2013 and 2012. In conjunction with the impairment tests, the Company considered factors such as the overall decline in the market price of the Company’s stock, a decline in market capitalization for a sustained period, and a decline in forecasted operations as indicators for potential goodwill impairment. In determining the amount of impairments within the analyses in 2013 and 2012, we considered both the income approach, utilizing a discounted cash flow analysis, and market approach, which considers what other purchasers and sellers in the market have paid for companies reasonably similar to the reporting unit. | |||||||||||||||||||||||||
The goodwill impairments are included as a component of impairment of goodwill and intangibles in the consolidated statement of operations. | |||||||||||||||||||||||||
The changes in the carrying amount of goodwill for the year ended December 31, 2013 and 2012, are as follows: | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Balance as of January 1 | |||||||||||||||||||||||||
Gross goodwill | $ | 6,925 | $ | 6,925 | |||||||||||||||||||||
Accumulated impairment losses | (5,441 | ) | — | ||||||||||||||||||||||
Net goodwill as of January 1 | 1,484 | 6,925 | |||||||||||||||||||||||
Goodwill acquired during the year | — | — | |||||||||||||||||||||||
Impairment loss | (1,484 | ) | (5,441 | ) | |||||||||||||||||||||
Balance as of December 31 | |||||||||||||||||||||||||
Gross goodwill | 6,925 | 6,925 | |||||||||||||||||||||||
Accumulated impairment losses | (6,925 | ) | (5,441 | ) | |||||||||||||||||||||
Net goodwill as of December 31 | $— | $ | 1,484 | ||||||||||||||||||||||
Impairment of Indefinite-lived Intangible Assets | |||||||||||||||||||||||||
During the fourth quarter of 2013, the Company made a brand strategy change to place greater emphasis on the promotion of the ZAGG and InvisibleShield brands. As a result of this decision, we determined that future cash flows under the iFrogz trademark likely will be less than previously estimated and that the trademark should be considered a definite-lived intangible asset. Management incorporated this information into an impairment analysis performed during the fourth quarter of 2013, relying on a discounted cash flow analysis and market approach. Management determined the carrying amount of the trademark exceeded the fair value and an impairment charge of $9,762 was recorded at December 31, 2013 as a component of the impairment of goodwill and intangibles line in the consolidated statement of operations. As the trademark was then considered a definite-lived intangible, the Company commenced amortizing the trademark over a ten-year useful life on an accelerated basis consistent with the projected future cash flows from the trademark. Amortization of this intangible commenced in the first quarter of 2014. Future amortization of this trademark is included in the estimated future amortization expense table below in this Note. | |||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
iFrogz trademark prior to impairment | $ | 16,800 | |||||||||||||||||||||||
iFrogz trademark impairment | (9,762 | ) | |||||||||||||||||||||||
iFrogz trademark – definite-lived | $ | 7,038 | |||||||||||||||||||||||
During the fourth quarter of 2012, the Company determined that future cash flows under the EarPollution trademark likely would be less than previously estimated and that the trademark should be considered a definite-lived intangible asset. Management performed an impairment analysis during the fourth quarter of 2012, relying on a discounted cash flow analysis and market approach, and determined that the carrying amount of the trademark exceeded the fair value and an impairment charge of $5,917 was recorded at December 31, 2012 as a component of the impairment of goodwill and intangibles line in the consolidated statement of operations. As the trademark was considered a definite-lived intangible, management commenced amortizing the trademark over an eight-year period on an accelerated basis consistent with the projected future cash flows from the trademark. Amortization of this intangible commenced in the first quarter of 2013. Future amortization of this trademark is included in the estimated future amortization expense table below in this Note. | |||||||||||||||||||||||||
December 31 | |||||||||||||||||||||||||
2012 | |||||||||||||||||||||||||
EarPollution trademark prior to impairment | $ | 8,300 | |||||||||||||||||||||||
EarPollution trademark impairment | (5,917 | ) | |||||||||||||||||||||||
EarPollution trademark – definite-lived | $ | 2,383 | |||||||||||||||||||||||
In addition, during the fourth quarter of 2012, the Company wrote-off $139 in internally developed software acquired in the iFrogz acquisition as it was abandoned in December 2012. The charge is included as a component of the impairment of goodwill and intangibles line in the consolidated statement of operations. | |||||||||||||||||||||||||
Definite-lived Intangibles | |||||||||||||||||||||||||
Definite-lived intangibles as of December 31, 2014 and 2013, were as follows: | |||||||||||||||||||||||||
As of December 31, 2014 | |||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Write-off of Fully Amortized Asset | Transfers from Indefinite-life Classification | Net Carrying Amount | Weighted Average Amortization Period | ||||||||||||||||||||
Customer relationships | $ | 41,500 | $ | (23,839 | ) | $ | — | $ | — | $ | 17,661 | 8.0 years | |||||||||||||
Non-compete agreements | 4,100 | (2,949 | ) | — | — | 1,151 | 4.8 years | ||||||||||||||||||
Other Trademarks | 3,500 | (2,216 | ) | — | — | 1,284 | 9.7 years | ||||||||||||||||||
iFrogz Trademark | 7,038 | (1,152 | ) | — | — | 5,886 | 10.0 years | ||||||||||||||||||
EarPollution Trademark | 2,383 | (1,026 | ) | — | — | 1,357 | 8.0 years | ||||||||||||||||||
Other | 600 | (554 | ) | — | — | 46 | 5.0 years | ||||||||||||||||||
Acquired technology | 709 | (267 | ) | — | — | 442 | 7.0 years | ||||||||||||||||||
Internet address | 124 | (78 | ) | — | — | 46 | 10.0 years | ||||||||||||||||||
Patents | 4,696 | (1,161 | ) | — | — | 3,535 | 12.5-14.0 years | ||||||||||||||||||
Total amortizable assets | $ | 64,650 | $ | (33,242 | ) | $ | — | $ | — | $ | 31,408 | 8.4 years | |||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Write-off of Fully Amortized Asset | Transfers from Indefinite-life Classification | Net Carrying Amount | Weighted Average Amortization Period | ||||||||||||||||||||
Customer relationships | $ | 41,500 | $ | (17,537 | ) | $ | — | $ | — | $ | 23,963 | 8.0 years | |||||||||||||
Non-compete agreements | 4,100 | (2,169 | ) | — | — | 1,931 | 4.8 years | ||||||||||||||||||
Other Trademarks | 3,500 | (1,719 | ) | — | — | 1,781 | 9.7 years | ||||||||||||||||||
iFrogz Trademark | — | — | — | 7,038 | 7,038 | 10.0 years | |||||||||||||||||||
EarPollution Trademark | 2,383 | (554 | ) | — | — | 1,829 | 8.0 years | ||||||||||||||||||
Other | 661 | (487 | ) | (61 | ) | — | 113 | 5.0 years | |||||||||||||||||
Acquired technology | 709 | (165 | ) | — | — | 544 | 7.0 years | ||||||||||||||||||
Internet address | 124 | (66 | ) | — | — | 58 | 10.0 years | ||||||||||||||||||
Patents | 4,696 | (734 | ) | — | — | 3,962 | 12.5-14.0 years | ||||||||||||||||||
Total amortizable assets | $ | 57,673 | $ | (23,431 | ) | $ | (61 | ) | $ | 7,038 | $ | 41,219 | 8.4 years | ||||||||||||
Customer relationships, trademarks, and other intangibles are amortized on an accelerated basis consistent with their expected future cash flows over their estimated useful life, which results in accelerated amortization. The remaining definite-lived intangible assets are amortized using the straight line method over their estimated useful life. For the years ended December 31, 2014, 2013, and 2012 amortization expense was $9,811, $9,702, and $9,801, respectively. Amortization expense was primarily recorded as a component of operating expense, however, amortization expense related to acquired technology in 2014, 2013, and 2012 of $102, $82, and $69, respectively, was recorded as a component of cost of sales. | |||||||||||||||||||||||||
Estimated future amortization expense is as follows: | |||||||||||||||||||||||||
2015 | $ | 8,560 | |||||||||||||||||||||||
2016 | 7,125 | ||||||||||||||||||||||||
2017 | 5,649 | ||||||||||||||||||||||||
2018 | 4,626 | ||||||||||||||||||||||||
Thereafter | 5,448 | ||||||||||||||||||||||||
Total | $ | 31,408 | |||||||||||||||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
INCOME TAXES | (6) INCOME TAXES | ||||||||||||
The components of income tax (provision) benefit for the years ended December 31, 2014, 2013 and 2012, are: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Current (provision): | |||||||||||||
Federal | $ | (9,705 | ) | $ | (8,720 | ) | $ | (15,466 | ) | ||||
State | (2,502 | ) | (766 | ) | (2,104 | ) | |||||||
Foreign | (37 | ) | — | (116 | ) | ||||||||
Total current | (12,244 | ) | (9,486 | ) | (17,686 | ) | |||||||
Deferred (provision) benefit: | |||||||||||||
Federal\ | 4,144 | 5,036 | 7,209 | ||||||||||
State | 1,627 | 755 | 1,084 | ||||||||||
Foreign | — | — | — | ||||||||||
Total deferred | 5,771 | 5,791 | 8,293 | ||||||||||
Total (provision) benefit | $ | (6,473 | ) | $ | (3,695 | ) | $ | (9,393 | ) | ||||
The following is a reconciliation of the income taxes computed using the federal statutory rate to the provision for income taxes for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Tax at statutory rate (35%) | $ | (5,927 | ) | $ | (2,970 | ) | $ | (8,364 | ) | ||||
State tax, net of federal tax benefit | (955 | ) | 25 | (663 | ) | ||||||||
Non-deductible expense and other | (680 | ) | 428 | (341 | ) | ||||||||
Domestic production activities deduction | 688 | 331 | 676 | ||||||||||
Return to provision adjustment | 453 | (148 | ) | (49 | ) | ||||||||
Liquidation of iFrogz EU | — | 5 | — | ||||||||||
Reserve related to FIN 48 | (541 | ) | (382 | ) | — | ||||||||
Interest and penalties | (37 | ) | (32 | ) | — | ||||||||
Effect of state rate changes, net of federal tax benefit | 526 | — | — | ||||||||||
Increase in valuation allowance | — | (952 | ) | (652 | ) | ||||||||
$ | (6,473 | ) | $ | (3,695 | ) | $ | (9,393 | ) | |||||
The tax effects of temporary differences that gave rise to significant portions of deferred tax assets and liabilities at December 31, 2014 and 2013, are as follows: | |||||||||||||
2014 | 2013 | ||||||||||||
Deferred tax assets: | |||||||||||||
Allowance for doubtful accounts | $ | 729 | $ | 958 | |||||||||
Deferred revenue | 12 | 38 | |||||||||||
Inventories | 5,584 | 3,211 | |||||||||||
Stock-based compensation | 1,825 | 1,464 | |||||||||||
Sales returns accrual | 3,374 | 2,943 | |||||||||||
Acquisition costs, net of amortization | 238 | 252 | |||||||||||
Intangible assets | 11,708 | 8,320 | |||||||||||
Goodwill | 2,067 | 2,192 | |||||||||||
HzO investment | 1,520 | 1,483 | |||||||||||
Capital loss carry-over | 278 | 271 | |||||||||||
Reserve on note receivable | 583 | 569 | |||||||||||
Other liabilities | 66 | 39 | |||||||||||
Deferred tax assets | 27,984 | 21,740 | |||||||||||
Valuation allowance | (1,798 | ) | (1,753 | ) | |||||||||
Total deferred tax assets | $ | 26,186 | $ | 19,987 | |||||||||
Deferred tax liabilities: | |||||||||||||
Property and equipment | 1,122 | 693 | |||||||||||
Total gross deferred tax liabilities | 1,122 | 693 | |||||||||||
Net deferred tax assets | $ | 25,064 | $ | 19,294 | |||||||||
Deferred tax assets, net – current | $ | 10,774 | $ | 7,917 | |||||||||
Deferred tax assets, net – noncurrent | 14,290 | 11,377 | |||||||||||
Net deferred tax assets | $ | 25,064 | $ | 19,294 | |||||||||
The Company recorded a full valuation allowance against a deferred tax asset generated by losses on its investment in HzO. HzO is a development stage enterprise and given current operations and uncertainty of future profitability, management has determined that it is more likely than not that the deferred tax asset will not be realizable. Given this, a full valuation allowance at December 31, 2014 and 2013 of $1,520 and $1,483, respectively, has been recorded against the deferred tax asset. In addition, at December 31, 2014 and 2013, the Company recorded a full valuation allowance against deferred tax assets resulting from capital loss carry-overs as the Company determined that it was unlikely the capital loss carry-overs would be able utilized. The $45 change in the valuation allowance from 2013 to 2014 reflected in the table above is due entirely to the change in the effective state rate during 2014. | |||||||||||||
For all other deferred tax assets, no valuation allowance has been recorded at December 31, 2014 and 2013, as management believes it is more likely than not that the results of future operations will generate sufficient taxable income to realize its deferred tax assets. | |||||||||||||
The Company has not recognized a deferred tax liability for the undistributed earnings of its foreign operations that arose in 2014 and prior years as the Company considers these earnings to be indefinitely reinvested. Cash held by foreign entities that is considered permanently re-invested totaled $5,036 as of December 31, 2014. If this cash were repatriated to the United States, outside the settlement of intercompany payables or payment of intercompany royalties, the Company would need to accrue and pay the related tax. However, the Company considers these funds permanently re-invested and has no plans to repatriate these funds. | |||||||||||||
The Company recognizes the impact of a tax position in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. As of December 31, 2014 and 2013, the Company recorded a tax contingency of $1,001 and $460, respectively. The tax contingencies are primarily related to the Company’s global tax strategy and certain transactions in foreign jurisdictions in prior periods. These tax contingencies, on a gross basis, are reconciled in the table below: | |||||||||||||
2014 | 2013 | ||||||||||||
Unrecognized tax benefits, as of January 1 | $ | 460 | $ | 61 | |||||||||
Gross increases – tax positions in current period | 541 | 399 | |||||||||||
Total benefit | $ | 1,001 | $ | 460 | |||||||||
As of December 31, 2014, the Company's liability related to unrecognized tax benefits was $1,001 of which $959 would impact the Company's effective tax rate if recognized. | |||||||||||||
For the years ended December 31, 2014, 2013, and 2012, the Company recorded $38, $32, and $0, respectively, in each year in interest and penalties. | |||||||||||||
The Company is currently under examination by the State of Minnesota and has accrued $146 based on our preliminary discussions. This amount is a component of income taxes payable on the consolidated balance sheet. The Company is currently not under examination by any other state or federal tax authority, but remains subject to income tax examinations for each of its open tax years, which extend back to 2011 for federal income tax purposes and 2010 for state income tax purposes. | |||||||||||||
Stock_Options_Warrants_and_Res
Stock Options Warrants and Restricted Stock | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Stock Options Warrants and Restricted Stock [Abstract] | |||||||||||||||||||
STOCK OPTIONS, WARRANTS, AND RESTRICTED STOCK | (7) STOCK OPTIONS, WARRANTS, AND RESTRICTED STOCK | ||||||||||||||||||
Equity Incentive Award Plans | |||||||||||||||||||
In 2007, the Company’s board of directors adopted and in 2008 the Company’s shareholders approved the ZAGG Incorporated 2007 Stock Incentive Plan (the “2007 Plan”). The 2007 Plan was amended to increase the number of shares issuable under the 2007 Plan to 10,000. As of December 31, 2014, there were 6,164 shares available for grant under the 2007 Plan. However, uponadoption of the 2013 Plan in January 2013 (see below), the Company ceased to grant awards pursuant to the 2007 Plan. All subsequent awards were and all future awards will be granted under the 2013 Plan. All awards that are outstanding under the 2007 Plan will continue to vest, be exercisable, and expire according to their respective terms. | |||||||||||||||||||
On January 15, 2013, the Company’s Board of Directors adopted and in June 2013, the Company’s shareholders approved the ZAGG Inc 2013 Equity Incentive Award Plan (the “2013 Plan”), a new equity incentive plan intended to replace the 2007 Plan. The 2013 Plan is an “omnibus plan” under which stock options, stock appreciation rights, performance share awards, restricted stock, and restricted stock units can be awarded. The 2013 Plan’s initial share reservation is 5,000 shares. The term of the plan is for 10 years from the date of its adoption. As of December 31, 2014, there were approximately 4,091 shares available for grant under the 2013 Plan. | |||||||||||||||||||
Common Stock Options | |||||||||||||||||||
Option awards are granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest based on three years of continuous service and have five-year contractual terms. | |||||||||||||||||||
The fair value of stock options has historically been estimated as of the grant date using the Black-Scholes option pricing model, though no stock options were granted during 2014, 2013, or 2012. | |||||||||||||||||||
The following table summarizes the stock option activity for the Company’s stock incentive plans for the year ended December 31, 2014: | |||||||||||||||||||
Weighted- | |||||||||||||||||||
Average | Net | ||||||||||||||||||
Weighted- | Remaining | Aggregate | |||||||||||||||||
Average | Contractual | Intrinsic | |||||||||||||||||
Options | Exercise Price | Term | Value | ||||||||||||||||
(In thousands) | (Per share) | (In years) | (In thousands) | ||||||||||||||||
Outstanding at December 31, 2013 | 439 | $ | 3.61 | 1.2 | $ | 186 | |||||||||||||
Exercised | -149 | 1.83 | |||||||||||||||||
Forfeited/expired | -5 | 4.12 | |||||||||||||||||
Outstanding at December 31, 2014 | 285 | $ | 5.02 | 0.6 | $ | 504 | |||||||||||||
Exercisable at December 31, 2014 | 285 | $ | 5.02 | 0.6 | $ | 504 | |||||||||||||
The weighted-average grant-date fair value of options granted during the years ended December 31, 2014, 2013, and 2012 was $0 as no shares were granted. The total intrinsic value of options exercised during the years ended December 31, 2014, 2013 and 2012, was $417, $540, and $3,555, respectively. | |||||||||||||||||||
As of December 31, 2014, there was $0 of total unrecognized compensation cost related to nonvested stock options granted under the stock incentive plans. The total grant date fair value of shares vested during the years ended December 31, 2014, 2013 and 2012, was $154, $593, and $1,060, respectively. | |||||||||||||||||||
The Company recorded share-based compensation expense only for those options that are expected to vest. The estimated fair value of the stock options is recognized on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the award. During the years ended December 31, 2014, 2013 and 2012, the Company recorded equity-based compensation expense of $28, $280 and $1,008, respectively, which is included as a component of selling, general and administrative expense. The net tax benefit recognized on equity-based compensation expense for the year ended December 31, 2014, 2013 and 2012 was $73, $88, and $181, respectively. The tax benefit realized from stock options exercised for the year ended December 31, 2014, 2013 and 2012 was $73, $88, and $599, respectively. | |||||||||||||||||||
During the third quarter of 2012, the Company incurred an incremental charge of $154 that was the direct result of the Separation and Release of Claims Agreement (“Separation Agreement”) between the Company and Robert G. Pedersen II, the Company’s former chief executive officer. Under the terms of the Separation Agreement, Mr. Pedersen’s 32 unvested stock options continued to vest under the original terms of the option grant. However, because future services to be performed by Mr. Pedersen were not considered substantive under US GAAP, the options were re-measured and the expense associated with these options was accelerated. In addition, the Company incurred a $910 charge during the third quarter of 2012 related to consulting fees due to Mr. Pedersen under the Separation Agreement, which were payable in monthly installments over the one-year term of the Separation Agreement. | |||||||||||||||||||
Warrants | |||||||||||||||||||
During the years ended December 31, 2014, 2013, and 2012, the Company issued warrants to purchase common shares for investor relations consulting services of 0, 0, and 50, respectively. The 2014, 2013, and 2012 warrants are exercisable at $0, $0 and $9.02, respectively. The warrants expire five years from the grant date and were fully vested on the date of grant. The grants were independently valued using the Black-Scholes option pricing model with separate assumptions for each tranche based on the fair value of the Company’s common stock on each vesting date, expected term equal to the remaining contractual term on each vesting date, expected volatility weighted between the Company’s historical volatility and the average historical volatility of similar entities with publicly traded shares over the expected term for each vesting date, and risk-free rate for the expected term based on the U.S. Treasury yield curve in effect with a period that approximates the remaining contractual term for each vesting date. For the year ended December 31, 2014, 2013, and 2012, the Company recorded expense of $0, $0, and $311, respectively, for these warrants. | |||||||||||||||||||
The fair value of warrants has been estimated as of the vesting date using the Black-Scholes option pricing model. For the years ended December 31, 2014, 2013, and 2012 the following assumptions were used in determining the fair value: | |||||||||||||||||||
2012 | |||||||||||||||||||
Expected dividend yield | 0 | % | |||||||||||||||||
Risk-free interest rate | 0.81 | % | |||||||||||||||||
Expected term (years) | 5.0 years | ||||||||||||||||||
Expected volatility | 89.5 | % | |||||||||||||||||
The following table summarizes the warrant activity for the year ended December 31, 2014: | |||||||||||||||||||
Warrants | Weighted- | ||||||||||||||||||
Average | Net | ||||||||||||||||||
Weighted- | Remaining | Aggregate | |||||||||||||||||
Average | Contractual | Intrinsic | |||||||||||||||||
Exercise Price | Term | Value | |||||||||||||||||
(In thousands) | (Per share) | (In years) | (In thousands) | ||||||||||||||||
Outstanding at December 31, 2013 | 390 | $ | 8.05 | 2 | $ | (1,442 | ) | ||||||||||||
Granted | — | — | |||||||||||||||||
Exercised | -5 | 2.58 | |||||||||||||||||
Forfeited/expired | — | — | |||||||||||||||||
Outstanding at December 31, 2014 | 385 | $ | 8.12 | 1 | $ | (512 | ) | ||||||||||||
Exercisable at December 31, 2014 | 385 | $ | 8.12 | 1 | $ | (512 | ) | ||||||||||||
The weighted-average and grant-date or vest-date fair value of warrants granted during the years ended December 31, 2014, 2013, and 2012, was $0, $0, and $6.46, respectively. The total intrinsic value of warrants exercised during the years ended December 31, 2014, 2013 and 2012, was $18, $0, and $4,195, respectively. | |||||||||||||||||||
As of December 31, 2014, there was $0 of total unrecognized estimated compensation cost related to nonvested warrants granted. The total fair value of warrants vested during the years ended December 31, 2014, 2013, and 2012 was $33, $0, and $311, respectively. | |||||||||||||||||||
For warrants that are compensatory, the Company records share-based compensation expense related to warrants only for warrants that have vested. The amount of the expense recognized is based on the estimated fair value of the warrants on the vesting date. During the years ended December 31, 2014, 2013 and 2012, the Company recorded equity-based compensation expense related to warrants of $0, $0, and $311, respectively, which is included as a component of selling, general and administrative expense. The net tax benefit recognized on equity-based compensation expense related to warrants for the year ended December 31, 2014, 2013 and 2012 was $0, $0, and $119, respectively. The tax benefit realized from compensatory warrants exercised for the years ended December 31, 2014, 2013 and 2012 was $9, $0, and $114, respectively. | |||||||||||||||||||
Restricted Stock | |||||||||||||||||||
Restricted stock awards are granted with a fair value equal to the ending stock price on the date of grant. A summary of the status of the Company’s restricted stock as of December 31, 2014, and changes during the year ended December 31, 2014, is presented below: | |||||||||||||||||||
Restricted | Weighted- | ||||||||||||||||||
Stock | Average | ||||||||||||||||||
Grant Date | |||||||||||||||||||
Fair Value | |||||||||||||||||||
(In thousands) | (Per share) | ||||||||||||||||||
Outstanding at December 31, 2013 | 357 | $ | 5.96 | ||||||||||||||||
Granted | 589 | 4.83 | |||||||||||||||||
Vested | (218 | ) | 6.38 | ||||||||||||||||
Forfeited | (101 | ) | 5.49 | ||||||||||||||||
Outstanding at December 31, 2014 | 627 | $ | 4.83 | ||||||||||||||||
As of December 31, 2014, there was $1,391 of total unrecognized compensation cost related to nonvested restricted stock awards granted under the stock incentive plans. That cost is expected to be recognized over a weighted-average period of approximately 0.9 years. | |||||||||||||||||||
The Company recorded share-based compensation expense only for restricted stock that is expected to vest. The estimated fair value of the restricted stock awards is recognized on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the award. During the years ended December 31, 2014, 2013, and 2012, the Company recorded equity-based compensation expense of $2,053, $3,846 and $4,699, respectively, which is included as a component of selling, general and administrative expense. The net tax benefit recognized on equity-based compensation expense for the years ended December 31, 2014, 2013 and 2012, was $785, $1,458 and $1,809, respectively. The tax benefit realized from vested restricted stock for the years ended December 31, 2014, 2013, and 2012, was $378, $1,042 and $1,169, respectively. | |||||||||||||||||||
During the third quarter of 2012, the Company incurred an incremental charge of $345 that was the direct result of the Separation Agreement. In accordance with the terms of the Separation Agreement, Mr. Pedersen’s 127 then unvested stock options became fully vested on August 17, 2013. However, under US GAAP, the expense associated with these options was accelerated as it was determined that the service to be performed by Mr. Pedersen was not considered to be substantive. | |||||||||||||||||||
During the year ended December 31, 2012, certain ZAGG employees received grants of restricted stock and elected to file an Internal Revenue Code Section 83(b) election and thereby elected to receive a net amount of shares in exchange for the Company incurring the tax liability for the grant date fair value of the award. In addition, certain ZAGG employees elected to receive a net amount of shares upon the vesting of a restricted stock grant in exchange for the Company incurring the tax liability for the fair value of the award on the vest date. This resulted in the Company recording $508 in compensation expense, with the offset being originally recorded to accrued wages and wage related expenses rather than to additional paid-in capital. | |||||||||||||||||||
During the years ended December 31, 2014 and 2013, certain ZAGG employees elected to receive a net amount of shares upon the vesting of a restricted stock grant in exchange for the Company incurring the tax liability for the fair value of the award on the vest date. This resulted in the Company recording $75 and $257, respectively, in compensation expense, with the offset being originally recorded to accrued wages and wage related expenses rather than to additional paid-in capital. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Measures [Abstract] | |||||||||||||||||
FAIR VALUE MEASURES | (8) FAIR VALUE MEASUREMENTS | ||||||||||||||||
Fair Value of Financial Instruments | |||||||||||||||||
At December 31, 2014 and 2013, the Company’s financial instruments included cash and cash equivalents, accounts receivable, accounts payable, a note receivable, and a line of credit with Wells Fargo. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximates fair value due to the short-term maturities of these financial instruments. The carrying value of the debt balances approximate fair value because the variable interest rates reflect current market rates. | |||||||||||||||||
In addition, as discussed in Note 9, management records an impairment on the note receivable if the fair value of the underlying collateral is less than the carrying amount. The assets that collateralize the note receivable include real property, interests in entities that own real property, and 80 shares of the Company’s stock that carry a restrictive legend until two months after the note receivable is paid in full. Management determined that the fair value of the collateral exceeded the carrying value of the note receivable at December 31, 2014 and 2013. | |||||||||||||||||
Fair Value Measurements | |||||||||||||||||
At December 31, 2014 and 2013, the following assets and liabilities were measured at fair value on a recurring basis using the level of inputs shown (in thousands): | |||||||||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-14 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Money market funds included in cash equivalents | $ | 374 | $ | 374 | — | — | |||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-13 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Money market funds included in cash equivalents | $ | 163 | $ | 163 | — | — | |||||||||||
Non-Recurring Fair Value Measurements | |||||||||||||||||
The Company also measures the fair value of certain assets on a non-recurring basis, generally quarterly, annually or when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. These assets include goodwill, intangible assets, property and equipment, asset purchase credits, and collateral securing the note receivable. | |||||||||||||||||
The following tables presents assets held as of December 31, 2013 (none in 2014), measured at fair value on a non-recurring basis using the level of inputs shown at the time of impairment (in thousands). | |||||||||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-13 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Goodwill | $ | — | — | — | $ | — | |||||||||||
iFrogz trademark | $ | 7,038 | — | — | $ | 7,038 | |||||||||||
As discussed in Note 5, at December 31, 2013, management performed an impairment analysis over each asset and ultimately recorded an impairment of goodwill of $1,484 and an impairment of the iFrogz trademark of $9,762. Thus, the balances in the table above reflect the fair value at December 31, 2013. The fair value of goodwill and the iFrogz trademark were determined using various valuation methods, including the income and market approaches. Under the income approach, the estimate of the present value of expected future cash flows was based on discount rates which incorporate a risk premium to take into account the risks inherent in those expected cash flows. The expected cash flows were estimated using available historical operating data projected into the future based on the Company’s current expectations. Various market approaches were utilized to determine appropriate royalty rates applicable to the valuation of the iFrogz trademark, to determine appropriate comparable company market multiples to estimate the value of the ZAGG Domestic reporting unit, and to estimate the overall value of the consolidated entity. | |||||||||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-12 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Goodwill | $ | 1,484 | — | — | $ | 1,484 | |||||||||||
EarPollution trademark | $ | 2,383 | — | — | $ | 2,383 | |||||||||||
As discussed in Note 5, at December 31, 2012, management performed an impairment analysis over each asset and ultimately recorded an impairment of goodwill of $5,441 and an impairment of the EarPollution trademark of $5,917. Thus, the balances in the table above reflect the fair value at December 31, 2012. The fair value of goodwill and the EarPollution trademark were determined using various valuation methods, including the income and market approaches. Under the income approach, the estimate of the present value of expected future cash flows was based on discount rates which incorporate a risk premium to take into account the risks inherent in those expected cash flows. The expected cash flows were estimated using available historical operating data projected into the future based on the Company’s current expectations. Various market approaches were utilized to determine appropriate royalty rates applicable to the valuation of the EarPollution trademark, to determine appropriate comparable company market multiples to estimate the value of the iFrogz reporting unit, and to estimate the overall value of the consolidated entity. |
Note_Receivable
Note Receivable | 12 Months Ended | ||
Dec. 31, 2014 | |||
Note Receivable [Abstract] | |||
NOTE RECEIVABLE | (9) NOTE RECEIVABLE | ||
In June 2008, Lorence Harmer became a member of the Company’s board of directors and in December 2009, was appointed as the chairman of the Audit Committee. Mr. Harmer introduced the Company to a consumer electronics product, which became known as the ZAGGbox. The ZAGGbox was intended to aggregate digital content such as music, pictures, videos, and movies into a single location so that users could share the content with most other networked media players, including mobile devices. After investigating the market opportunity for the ZAGGbox, the Company determined in June 2009 that it wished to obtain certain rights for the development and sale of the ZAGGbox in North America. The Company entered into negotiations with Teleportall, LLC (“Teleportall”), the owner of the technology used in the ZAGGbox, regarding production and distribution of the ZAGGbox. On June 17, 2009, the Company issued its initial purchase order for ZAGGbox units in the amount of $3,500 and advanced to Teleportall a total of $1,153 representing a $200 non-recurring engineering (NRE) fee and $953 in payment of 30% of the total purchase price for the units ordered by the Company. Mr. Harmer participated in the negotiations between the Company and Teleportall, and continued to represent the Company throughout 2009 and 2010 concerning the ZAGGbox. In May 2010, the Company entered into a Distribution and License Agreement with Teleportall, which memorialized Teleportall’s agreement to manufacture and deliver ZAGGboxes to the Company and appointed the Company as the exclusive distributor for the ZAGGbox in North America. Additionally, in May 2010, the Company entered into an agreement with Harmer Holdings, LLC (“Holdings”), an affiliate of Mr. Harmer, under which Holdings agreed to repurchase unsold ZAGGboxes under certain circumstances. | |||
Teleportall proceeded to develop the ZAGGbox and provided periodic progress reports to the Company. However, Teleportall did not deliver the product in time for the 2009 Christmas selling season. Subsequently, during the December 1, 2009, meeting of the Board of Directors of the Company, Mr. Harmer disclosed to the other members of the Board that he owned an interest in Teleportall. After a discussion about his financial interest in Teleportall during that meeting, Mr. Harmer stated he was willing to divest himself of any ownership in Teleportall, and the Board of Directors voted unanimously to accept Mr. Harmer’s proposal that he would do so, and assumed thereafter that Mr. Harmer had completed his divestiture. | |||
The development of the product continued in 2010 with the expectation that the product would be delivered in time for the 2010 Christmas selling season. The Company made additional payments for long lead-time parts to Teleportall in the aggregate amount of $2,747. When it became obvious to the Company that the product would not be ready to market and sell during the 2010 Christmas season, the Company commenced discussions to restructure the Distribution and License Agreement with Teleportall. During the course of those discussions, the Company learned in January 2011 that Mr. Harmer did not divest himself of any interest in Teleportall following the December 2009 meeting of the Board of Directors of the Company where he agreed to do so, but retained an indirect ownership interest of 25% in Teleportall as well as other entities potentially affiliated with the ZAGGbox. As a result of the foregoing, the Company entered into an agreement with Teleportall, Mr. Harmer and several entities owned or controlled by Mr. Harmer (the “Harmer Agreement”), dated March 23, 2011, but subject to further negotiations and ratification through April 5, 2011. Pursuant to the Harmer Agreement, the parties agreed to terminate the Distribution and License Agreement on the following terms: | |||
Mr. Harmer, Teleportall, and certain of their affiliates delivered a promissory note (the “Note”) dated March 23, 2011, to the Company in the original principal amount of $4,126 which accrues interest at the rate of LIBOR plus 4% per annum (adjusted quarterly) payable as follows: (i) interest only payments (a) on September 23, 2011, and (b) thereafter on or before the last day of each calendar quarter, (ii) 50% of the net profits of each ZAGGbox sale by Teleportall and its affiliates to be applied, first, to accrued interest and, second, to the principal balance of the Note, and (iii) the unpaid balance of principal and interest due in full on March 23, 2013. The principal amount of the Note is equal to the aggregate amount of the payments made by the Company to Teleportall plus the internal cost of the ZAGGbox project incurred by the Company. The Note is secured by certain real property, interests in entities that own real property and restricted and free-trading securities. | |||
Teleportall and the Company entered into a License Agreement on March 23, 2011 under which the Company licensed to Teleportall the use of certain ZAGG names and trademarks to sell and distribute the ZAGGbox product. Teleportall agreed to pay ZAGG a 10% royalty on net sales of ZAGGboxes per calendar quarter as a license fee. | |||
Teleportall and ZAGG entered into a non-exclusive, two year Commission Agreement on March 23, 2011, under which Teleportall could make introductions of many ZAGG products in all countries where ZAGG did not then have exclusive dealing agreements in respect of the marketing, distribution or sale of its products. The Commission Agreement provided that (a) it would automatically terminate concurrent with any uncured default under the Note, and (b) the term could be extended for an additional time period on reasonable terms if Teleportall’s introductions during the initial two-year term resulted in the purchase of no less than $25,000 of ZAGG products during the initial term. Payment terms of the Commission Agreement are as follows: | |||
· | 10.0% commission payments on orders received by the Company from retailers and distributors first introduced to the Company by Teleportall during the first 60 days after the introduction is made (the “Load-in Period”) to be split 50/50 between cash to Teleportall and principal payments on the Note. However, all commission payments will be paid to ZAGG if Teleportall is in breach of the terms of the Note or any other agreements between the parties; | ||
· | 3.0% commission on all orders within the first 24 months after the Load-in Period, and 2.0% thereafter, from retailers and distributors first introduced to the Company as described under the terms set forth in the preceding bullet point. The 3.0% and 2.0% commissions will be split 50/50 between cash to Teleportall and principal payments on the Note; and | ||
· | 3.0% commission on all orders generated in countries where Teleportall is paid commission under the terms of the preceding two bullet points (excluding the United States), regardless of Teleportall’s involvement in ZAGG’s receipt of the order until the first to occur of (i) payment in full of the Note, (ii) termination of the Commission Agreement or (iii) 24 months after the applicable Load-in Period. | ||
No revenue has been recognized from Teleportall. | |||
As part of the Harmer Agreement, the Company modified a previously granted stock option award to Mr. Harmer, which resulted in a charge of $1,560 that was recorded in the second quarter of 2011. The charge was recorded in the second quarter of 2011 due to further negotiations and ratification on April 5, 2011. The further negotiations concerned the restricted legend placed on 80 shares of stock subject to repayment of the Note. | |||
The Note was originally accounted for under the cost recovery method and was originally included in the consolidated balance sheet at $3,900 which was the value of the ZAGGbox inventory advances. The original face value of the Note of $4,126 was for reimbursement of the inventory advances and other costs associated with the ZAGGbox and approximated fair value at March 23, 2011, as the variable interest rate on the Note approximated market rates. | |||
On September 20, 2011, and prior to the due date of the first interest-only payment due on the Note, Mr. Harmer and two of his affiliates, Holdings and Teleportall, filed a lawsuit in Utah state court against the Company, Robert G. Pedersen, II (ZAGG’s former CEO), Brandon T. O’Brien (ZAGG’s CFO) and KPMG LLP (ZAGG’s independent registered public accounting firm). KPMG LLP and Messrs. Pedersen and O’Brien were subsequently dismissed from the lawsuit, as well as certain of the plaintiff’s causes of action against the Company. In their lawsuit, the plaintiffs allege that the defendants defamed Mr. Harmer, breached the Harmer Agreement and interfered with other rights of the plaintiffs. The Company has responded to the plaintiffs’ claims, denying all of the material allegations made by the plaintiffs. The Company believes the plaintiffs’ claims to be without merit and intends to continue to vigorously defend against them. | |||
Subsequently, Mr. Harmer failed to make the required interest-only payment to the Company due on September 23, 2011. Mr. Harmer failed to cure the default and ZAGG commenced foreclosure on the collateral securing the loan, which consists of real property, interests in entities that own real property, and restricted and free-trading securities, which included 45 shares of ZAGG common stock. In addition to the collateral, Mr. Harmer had also agreed that he would not sell 80 shares of ZAGG common stock until two months after the Note was paid in full. Given the Note is full recourse, and the 80 shares are currently being held by the Third District Court in the State of Utah, the Company believes it can recover the 80 shares in partial payment of the Note balance. | |||
Following Mr. Harmer’s default on the loan, management determined that it was probable that the Company would be unable to collect all amounts due from Mr. Harmer according to the terms of the Note. As the Note became collateral-dependent upon Mr. Harmer’s default, management engaged various third-party certified valuation specialists to assist management in its determination of the fair value of the collateral and whether it is sufficient to recover the Note balance. As of December 31, 2014, management determined that the estimated fair value of the underlying collateral was between $1,531 and $1,666. As management has not been able to ascertain whether Mr. Harmer owns 50% or 100% of Holdings, management used the low end of the above range ($1,531) and compared it to the carrying amount of the Note of $1,149. The remaining Note balance of $1,149 appears to be collectable given management’s best estimate of the cash recovery on the collateral securing the Note (fair value, less cost to sell) of $1,531. Additionally, the Company has classified $348 of the Note as an offset to equity, representing the collateral secured by ZAGG common stock, which management has taken steps to recover to repay the Note, as noted below. If a decrease in the amount of the Note classified as an offset to equity occurs as a result of a decrease in the stock price, the Company reclassifies the difference back to the note receivable line item on the consolidated balance sheet to the extent that there is sufficient underlying collateral in excess of the book value. During the years ended December 31, 2014 and 2013, the Company reclassified $0 and $218, respectively, from equity to the note receivable line item on the consolidated balance sheet to reflect the decrease in the Company’s stock price. Ultimately, any recovery in excess of the carrying value of the Note will be recognized when realized. | |||
The Company determined the fair values of the collateral of the Note, which required estimates and assumptions. Management determined the value of the 80 shares of ZAGG common stock held by Mr. Harmer based on quoted market prices. The real estate holdings were valued primarily based on the sales comparison approach as sales of comparable properties were utilized. The investments in real estate companies were valued utilizing comparable market sales, a discounted cash flow analysis, and other valuation methodologies management deemed to be appropriate. | |||
Since the Note became collateral dependent in October 2011, management has (1) foreclosed and sold 45 shares of ZAGG common stock for $496 (December 2011); (2) foreclosed on real property valued at $250 (January 2012); and (3) foreclosed on stock and warrants in a private company of $516 (May 2012). These foreclosures were recorded as a reduction to the Note in the period in which the foreclosure occurred. Management continues to actively pursue the foreclosure of all remaining collateral. | |||
At December 31, 2014, the total unpaid principal balance, including accrued interest, late fees and costs incurred in collection, totaled $4,735. |
Debt_and_Letters_of_Credit
Debt and Letters of Credit | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Debt and Letters of Credit [Abstract] | |||||
DEBT AND LETTERS OF CREDIT | (10) DEBT AND LETTERS OF CREDIT | ||||
Wells Fargo Revolving Line of Credit Facility | |||||
On December 23, 2014, the Company and Wells Fargo, entered into the Third Amendment, which modified the original Credit Agreement entered into between the Company and Wells Fargo on December 7, 2012 and all subsequent amendments to the Credit Agreement (First Amendment to the Credit Agreement entered into on December 20, 2013 and Second Amendment to the Credit Agreement entered into on November 4, 2014). The Line of Credit includes a letter of credit sub-feature that allows the Company to issue standby commercial letters of credit against the Line of Credit, not to exceed at any time an aggregate of $5,000. During 2014 and 2013, ZAGG did not issue any standby commercial letters of credit. | |||||
The Third Amendment provides a $25,000 Line of Credit and extended the maturity date from December 1, 2015 to December 1, 2016. As of December 31, 2014 and 2013, the total balance outstanding on the line of credit was zero and $17,543, respectively. | |||||
As consideration for entering into the Third Amendment, the Company agreed to pay to Wells Fargo an amendment fee of $10 as well as reasonable legal and collateral examination fees. | |||||
Borrowings and repayments under the Line of Credit may occur from time to time in the Company’s ordinary course of business through December 1, 2016. Any outstanding borrowings under the Line of Credit mature and are due on December 1, 2016. | |||||
Any outstanding principal balance under the Line of Credit bears interest at a fluctuating rate per annum determined to be the sum of the (1) LIBOR margin established under the Credit Agreement (with the initial LIBOR margin being set at 1.25%) and (2) Daily Three Month LIBOR (as defined in the Credit Agreement) in effect from time to time. Each change in the rate of interest will become effective on each business day on which a change in Daily Three Month LIBOR is announced by Wells Fargo. | |||||
Pursuant to the terms of the Amendment, Wells Fargo will adjust the LIBOR margin used to determine the rate of interest under the Line of Credit on a quarterly basis. The applicable LIBOR margin is calculated based on the Company's ratio of Total Liabilities to Tangible Net Worth (as these terms are defined in the Credit Agreement) in accordance with the following table: | |||||
Total Liabilities to Tangible Net Worth | Applicable LIBOR Margin | ||||
1.00 or greater | 1.25 | % | |||
0.65 or greater, but less than 1.00 | 1 | % | |||
Less than 0.65 | 0.75 | % | |||
Under the Line of Credit, each adjustment is effective on the first business day of the Company’s fiscal quarter following the quarter during which Wells Fargo receives and reviews the Company’s most current fiscal quarter-end financial statements in accordance with the requirements established in the Credit Agreement. | |||||
In addition, under the Amendment the Company pays Wells Fargo a quarterly fee based on the average unused amount of the Line of Credit depending on the Company’s Leverage Ratio (as this term is defined in the Credit Agreement) based on the following table: | |||||
Leverage Ratio | Applicable Unused Commitment Fee (per annum) | ||||
1.00 or greater | 0.35 | % | |||
0.65 or greater, but less than 1.00 | 0.25 | % | |||
Less than 0.65 | 0.15 | % | |||
For the years ended December 31, 2014 and 2013, $75 and $73, respectively, in unused line fees had been incurred and was included as a component of interest expense in the consolidated statement of operations. | |||||
At December 31, 2014, the interest rate on the Line of Credit was 1.13%, though as noted above, the outstanding balance was $0. At December 31, 2013, the weighted average interest rate on all outstanding borrowings under the Line of Credit was 1.00%. At December 31, 2014 and 2013, the effective interest rate was 0% and 1.11%, respectively. | |||||
The Company originally incurred and capitalized $238 of direct costs related to the establishment of the Credit Agreement with Wells Fargo. For the years ended December 31, 2014 and 2013, the Company amortized $66 and $120, respectively of these loan costs, which is included as a component of interest expense in the consolidated statement of operations. | |||||
The Company amortizes these deferred loan costs under the effective interest rate method. The carrying value of deferred loan costs at December 31, 2014 and 2013, was $60 and $126, respectively, and is included as a component of noncurrent other assets in the consolidated balance sheet. | |||||
Attached to the Credit Agreement are a number of financial and non-financial debt covenants. At December 31, 2014, the Company was in compliance with all covenants associated with the Credit Agreement. | |||||
Treasury_Stock
Treasury Stock | 12 Months Ended | |
Dec. 31, 2014 | ||
Treasury Stock [Abstract] | ||
TREASURY STOCK | -11 | TREASURY STOCK |
In each of fiscal year 2014 and 2013, the Company’s board of directors authorized the repurchase of up to $10,000 of the Company’s outstanding common stock. The Company’s board of directors also authorized the Company to enter into a Rule 10b5-1 plan when appropriate. | ||
For the years ended December 31, 2014 and 2013, the Company purchased 1,813 and 1,756 shares, respectively, of ZAGG Inc common stock. Cash consideration paid for the purchase of ZAGG Inc common stock for the years ended December 31, 2014 and 2013 was $9,579 and $9,997, respectively, which included commissions paid to brokers of $54 and $53, respectively. For the years ended December 31, 2014 and 2013, the weighted average price per share was $5.25 and $5.66, respectively. The consideration paid has been recorded within stockholders’ equity in the condensed consolidated balance sheet. | ||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Commitments and Contingencies [Abstract] | |||||||
COMMITMENTS AND CONTINGENCIES | (12) COMMITMENTS AND CONTINGENCIES | ||||||
Operating leases | |||||||
The Company leases office and warehouse space, office equipment, and mall cart locations under operating leases that expire through 2017. Future minimum rental payments required under the operating leases at December 31, 2014 are as follows: | |||||||
2015 | $ | 912 | |||||
2016 | 767 | ||||||
2017 | 376 | ||||||
Total | $ | 2,055 | |||||
For the years ended December 31, 2014, 2013 and 2012, rent expense was $1,640, $1,564 and $1,615, respectively. Rent expense is recognized on a basis which approximates straight line over the lease term. Rent expense for the years ended December 31, 2014, 2013, and 2012 was net of sublease income of $910, $996, and $751 respectively. | |||||||
Commercial Litigation | |||||||
Lorence A. Harmer, et al v ZAGG Inc et al, Third Judicial District Court, Salt Lake County, State of Utah, Civil No. 110917687. On September 20, 2011, Lorence A. Harmer, a former director of ZAGG and two of his affiliates, Harmer Holdings, LLC, and Teleportall, LLC, filed a lawsuit against the Company, Robert G. Pedersen II, Brandon T. O’Brien, and KPMG LLP. KPMG LLP was dismissed from the lawsuit in January 2012. The plaintiffs alleged that the defendants defamed Mr. Harmer, breached the Settlement Agreement and other agreements between the plaintiffs (alleging claims for breach of contract, breach of the covenant of good faith, and fair dealing) and the Company, and interfered with other rights of the plaintiffs. The defendants denied all of the material allegations made by the plaintiffs. On October 29, 2012, the Company filed a Counterclaim and Third-Party Complaint against Harmer, Holdings, Teleportall and third-party Global Industrial Services Limited asserting claims for breach of contract, deficiency, indemnity and attorneys’ fees, breach of the implied covenant of good faith and fair dealing, quasi contract, unjust enrichment, quantum meruit and declaratory judgment. On June 10, 2013, the court dismissed the plaintiffs’ claims for defamation, negligence, tortious interference, and interference with prospective economic relations against the Company and all claims against Messrs. Pedersen and O’Brien. The Company believes the plaintiffs’ remaining claims of breach of contract, breach of the covenant of good faith and fair dealing, and declaratory relief to be without merit and intends to continue to vigorously defend against them. The plaintiffs have not yet made a specific damages claim. | |||||||
Patent/Trademark Litigation | |||||||
ZAGG Intellectual Property Holding Co. Inc. v. NLU Products et al, U.S. District Court, District of Utah, 2:11-cv-00517. On June 7, 2011, the Company filed a patent infringement lawsuit against NLU Products, LLC; Wrapsol, LLC; XO Skins, LLC; Fusion of Ideas, Inc.; Clear-Coat, LLC; Case-Ari, LLC; United SGP Corp.; Stealth Guards; Vituorsity Products, LLC; Skinomi LLC; Cellairis; Best Skins Ever; Headco, LLC; and Ghost Armor, LLC that seeks to enforce rights under United States Patent No. 7,957,524. The defendants have raised defenses and, in some cases, asserted counterclaims against the Company, that seek declarations of unenforceability or non-infringement of the patent. These counterclaims do not assert any claims for affirmative relief, including claims for damages, against the Company, apart from a request for an award of costs and attorneys’ fees to the prevailing party. NLU Products, LLC; Wrapsol, LLC; XO Skins, LLC; Fusion of Ideas, Inc.; Clear-Coat, LLC; Case-Ari, LLC; United SGP Corp.; Stealth Guards; and Vituorsity Products, LLC have settled with the Company. Litigation of this action was stayed pending a reexamination of United States Patent No. 7,957,524 by the United States Patent and Trademark Office (“USPTO”). The reexamination led to amendments to the claims of the patent, and the USPTO issued a reexamination certificate. This case was administratively closed with leave to reopen. The Company is currently analyzing the various defendants’ current product offerings in light of the reexamined claims. | |||||||
ZAGG v. TrekStor, Regional Court, Dusseldorf, Germany. In September 2011, the Company brought suit in Dusseldorf, Germany against TrekStor for infringement of ZAGG design registrations for the ZAGGmate keyboard case and for unfair competition. After the Company completed briefing of its claims against TrekStor and presented its case at oral argument, TrekStor filed a separate proceeding alleging that it is the owner of the ZAGGmate keyboard case design. The Company’s action against TrekStor was then stayed pending the resolution of TrekStor’s case against the Company. On July 23, 2013, TrekStor’s claims were dismissed and the Company was awarded its costs in that action. Although that decision has been appealed, the stay on the Company’s action against TrekStor has been lifted, the necessary bond has been posted, and the court will proceed to issue a decision regarding the Company’s claims. In the opinion of management, the ultimate disposition of TrekStor’s appeal will not have a material adverse effect on the Company’s consolidated financial position, results of operations, or liquidity. | |||||||
ZAGG Intellectual Property Holding Co v. Tech21 et al., U.S. District Court, District of Utah, 2:14-cv-00113-BCW. On February 18, 2014, ZAGG IP filed a complaint against Tech21, Ltd. alleging, among other things, that the defendant makes, uses, sells, offers for sale, and/or imports into the United States a kit for protecting a surface of an electronic device that infringes at least one claim of ZAGG IP’s U.S. patent No. 8,567,596 entitled Elec1.tronic Device Protective Film Application Kit and Method (the “‘596 Patent”). The defendant has not filed any counterclaims and no material determinations have been made by the court in this matter. This litigation is stayed pending resolution of Inter Partes Patent Review of the ‘596 Patent, in the USPTO. | |||||||
ZAGG Intellectual Property Holding Co v. Superior Communications, Inc., U.S. District Court, District of Utah 2:14-cv-00121-TS. On February 19, 2014, ZAGG IP filed a complaint against Superior Communications, Inc. alleging, among other things, that the defendant makes, uses, sells, offers for sale, and/or imports into the United States kits for protecting a surface of an electronic device that infringe at least one claim of the ‘596 Patent. The defendant has not filed any counterclaims and no material determinations have been made by the court in this matter. This litigation is stayed pending resolution of Inter Partes Patent Review of the ‘596 Patent, in the USPTO. | |||||||
Class Action Lawsuits | |||||||
James H. Apple, et al. v. ZAGG Inc, et al., U.S. District Court, District of Utah, 2:12-cv-00852; Ryan Draayer, et al. v. Zagg Inc, et al., U.S. District Court, District of Utah, 2:12-cv-00859. On September 6 and 10, 2012, two putative class action lawsuits were filed by purported Company shareholders against the Company, Randall Hales, Brandon O’Brien, and Cheryl Larabee, as well as Robert G. Pedersen II, the Company’s former Chairman and CEO, and Edward Ekstrom and Shuichiro Ueyama, former members of the Company’s Board of Directors. These lawsuits were subsequently amended by a complaint filed on May 6, 2013. The plaintiffs seek certification of a class of purchasers of the Company’s stock between October 15, 2010 and August 17, 2012. The plaintiffs claim that as a result of Mr. Pedersen's alleged December 2011 margin account sales, the defendants initiated a succession plan to replace Mr. Pedersen as the Company’s CEO with Mr. Hales, but failed to disclose either the succession plan or Mr. Pedersen's margin account sales, in violation of Sections 10(b), 14(a), and 20(a), and SEC Rules 10b-5 and 14a-9, under the Securities Exchange Act of 1934 (the “Exchange Act”). On March 7, 2013, the U.S. District Court for the District of Utah (the “Court”) consolidated the Apple and Draayer actions and assigned the caption In re: Zagg, Inc. Securities Litigation, and on May 6, 2013, plaintiffs filed a consolidated complaint. On July 5, 2013, the defendants moved to dismiss the consolidated complaint. On February 7, 2014, the Court entered an order granting the Company’s motion to dismiss the consolidated complaint. On February 25, 2014, plaintiffs filed a notice of appeal with the U.S. Court of Appeals, Tenth Circuit. On June 17, 2014, plaintiffs filed their opening appellate brief appealing the Courts decision with respect to some of their claims. The Tenth Circuit heard oral argument on the appeal on January 22, 2015. The U.S. Court of Appeals, Tenth Circuit, has not yet entered a decision on the appeal. | |||||||
Arthur Morganstern v. Robert G. Pedersen II et al., Third Judicial District Court, Salt Lake County, State of Utah, Civil No. 120908452; Albert Pikk v. Robert G. Pedersen II et al., U.S. District Court, District of Utah, Case No. 2:12-cv-1188; Rosenberg v. Robert G. Pedersen II et al., U.S. District Court, District of Utah, Case No. 2:12-cv-1216. On December 14, 2012, the first of three shareholder derivative complaints were filed against several of the Company’s current and former officers and directors. These complaints make allegations similar to those presented in the consolidated class action lawsuits, but they also assert various state law causes of action, including claims for breach of fiduciary duty, waste of corporate assets, unjust enrichment, and insider trading. Each of these derivative complaints seek unspecified damages on behalf of the Company, which is named solely as a nominal defendant against whom no recovery is sought. On February 26, 2013, the Court consolidated the Pikk and Rosenberg actions and assigned the caption In re ZAGG Inc. Shareholder Derivative Litigation, and on June 5, 2013, plaintiffs filed a consolidated complaint. On April 4, 2014, the defendants moved to dismiss the consolidated complaint. On October 9, 2014, the Court entered an order granting dismissal of the consolidated complaint. On January 8, 2015, plaintiffs filed a notice of appeal, and the appeal is now pending in the U.S. Court of Appeals, Tenth Circuit. | |||||||
SEC Investigation | |||||||
In the fourth quarter of 2012, the Company received requests to provide documentation and information to the staff of the SEC in connection with a non-public investigation being conducted by the SEC’s Salt Lake City office. The Company believes the investigation includes a review of the facts and circumstances surrounding some of the same issues raised by the plaintiffs in the above lawsuits; specifically, whether the Company failed to disclose Mr. Pedersen's margin account sales or the alleged existence of a plan to have Mr. Hales succeed Mr. Pedersen as the Company’s CEO. The Company responded to these requests and is cooperating fully with the staff. The Company has chosen to disclose this non-public investigation due to the highly public nature of the lawsuits described above, which the Company intends to defend vigorously. | |||||||
Other Litigation | |||||||
The Company is not a party to any other litigation or other material claims at this time. While the Company currently believes that the amount of any ultimate potential loss for known matters would not be material to the Company’s financial condition, the outcome of these actions is inherently difficult to predict. In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on the Company’s financial condition or results of operations in a particular period. | |||||||
The Company establishes reserves when a particular contingency is probable and estimable. Other than those discussed above, the Company has not accrued for any loss at December 31, 2014 in the consolidated financial statements as the Company does not consider a loss to be probable nor estimable. The Company faces contingencies that are reasonably possible to occur; however, the reasonably possible exposure to losses cannot currently be estimated. |
Concentrations
Concentrations | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Concentrations [Abstract] | |||||||||||||
CONCENTRATIONS | (13) CONCENTRATIONS | ||||||||||||
Concentration of credit risk | |||||||||||||
Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company places its cash with high credit quality financial institutions. The Company maintains its cash in bank deposit accounts, which, at times, exceed federally insured limits. The Company has not experienced any losses in such accounts through December 31, 2014. | |||||||||||||
At December 31, 2014 and 2013, approximately 48% and 44%, respectively, of the balance of accounts receivable was due from the Company’s largest customer. In addition at December 31, 2014 and 2013, separate customers accounted for 14% and 14%, respectively, of the accounts receivable balance. No other customer account balances were more that 10% of accounts receivable at December 31, 2014 or 2013. If one or more of the Company’s significant customers were to become insolvent or were otherwise unable to pay for the products provided, it would have a material adverse effect on the Company’s financial condition and results of operations. | |||||||||||||
Concentration of supplier | |||||||||||||
The Company’s logistics partners arrange for production of its raw materials related to the InvisibleShield film products primarily from one source. Management is aware of similar raw materials that would be available from other sources if required and has current plans to immediately engage such resources if necessary. A change in supplier, however, could cause a delay in manufacturing and a possible loss of sales, which could adversely affect operating results. | |||||||||||||
Concentration of sales | |||||||||||||
For the years ended December 31, 2014, 2013, and 2012, one customer accounted for 30%, 26%, and 32%, respectively, of the Company’s sales; during the same periods, a second customer accounted for 11%, 18%, and 11%, respectively, of sales; and a third customer accounted for 11%, 6%, and 7%, respectively, of sales. No other customer account balances were more that 10% of sales during 2014. If the Company loses one or more of the Company’s significant customers, it would have a material adverse effect on the Company’s financial condition and results of operations. | |||||||||||||
The percentage of sales by geographic region for the years ended December 31, 2014, 2013 and 2012 was approximately: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | 90 | % | 90 | % | 87 | % | |||||||
Europe | 7 | % | 5 | % | 6 | % | |||||||
Other | 3 | % | 5 | % | 7 | % | |||||||
At December 31, 2014 and 2013, net assets located overseas in Shannon, Ireland totaled $8,050 and $8,695, respectively. |
Segment_Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2014 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | (14) SEGMENT REPORTING |
As of December 31, 2012, the Company reported financial information on the following three reportable segments: ZAGG, iFrogz, and HzO. During the first quarter of 2013, management consolidated a number of ZAGG/iFrogz processes and functions, which resulted in the announcement of the closure of the iFrogz office in Logan, Utah and the lay-off of a number of iFrogz employees during the first quarter of 2013. Ultimately, it was decided that the two offices would be consolidated and that the marketing, product development, product management, customer service, sales, accounting, and IT teams that had previously operated independently, would now be combined. | |
In addition, as the Company has continued to evolve as a mobile device accessories company, financial information reviewed and evaluated by the chief operating decision maker is at the consolidated company level, including budget and sales reviews. Further, due to the decrease in size and significance of the HzO investment ($0 balance at December 31, 2014 and 2013), management determined it to be a corporate asset rather than a separate operating segment. | |
Ultimately, management concludes that the Company should be considered a single reportable segment in 2014 and 2013. | |
Quarterly_Financial_Data_Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||||||
QUARTERLY FINANCIAL DATA (UNAUDITED) | (15) – QUARTERLY FINANCIAL DATA (UNAUDITED) | ||||||||||||||||||||
Quarterly financial information is presented in the following summary: | |||||||||||||||||||||
Year ended December 31, 2014 | |||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Year | |||||||||||||||||
Net sales | $ | 49,003 | $ | 50,154 | $ | 60,013 | $ | 102,415 | $ | 261,585 | |||||||||||
Income (loss) from operations | 1,940 | 1,580 | (6,611 | ) | 20,074 | 16,983 | |||||||||||||||
Net income (loss) | 988 | 793 | (4,319 | ) | 12,999 | 10,461 | |||||||||||||||
Earnings (loss) per share attributable to stockholders: (1) | |||||||||||||||||||||
Basic | $ | 0.03 | $ | 0.03 | $ | (0.14 | ) | $ | 0.44 | $ | 0.35 | ||||||||||
Diluted | 0.03 | 0.03 | (0.14 | ) | 0.43 | 0.34 | |||||||||||||||
Weighted average common shares: | |||||||||||||||||||||
Basic | 30,549 | 30,281 | 30,312 | 29,854 | 30,247 | ||||||||||||||||
Diluted | 30,864 | 30,575 | 30,312 | 30,288 | 30,610 | ||||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Year | |||||||||||||||||
Net sales | $ | 51,471 | $ | 51,198 | $ | 49,869 | $ | 66,818 | $ | 219,356 | |||||||||||
Income (loss) from operations | 2,007 | 5,416 | 6,435 | (2,912 | ) | 10,946 | |||||||||||||||
Net income (loss) | 876 | 2,774 | 3,184 | (2,044 | ) | 4,790 | |||||||||||||||
Earnings (loss) per share attributable to stockholders: (1) | |||||||||||||||||||||
Basic | $ | 0.03 | $ | 0.09 | $ | 0.1 | $ | (0.07 | ) | $ | 0.16 | ||||||||||
Diluted | 0.03 | 0.09 | 0.1 | (0.07 | ) | 0.15 | |||||||||||||||
Weighted average common shares: | |||||||||||||||||||||
Basic | 31,052 | 30,739 | 30,926 | 30,883 | 30,900 | ||||||||||||||||
Diluted | 31,726 | 31,218 | 31,466 | 30,883 | 31,459 | ||||||||||||||||
-1 | The earnings per share calculations for each of the quarters were based upon the weighted average number of shares outstanding during each period, and the sum of the quarters may not be equal to the full year earnings per common share amounts. |
Defined_Contribution_Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2014 | |
Defined Contribution Plan [Abstract] | |
DEFINED CONTRIBUTION PLAN | (16) DEFINED CONTRIBUTION PLAN |
The Company offers a 401(k) for full-time employees that have been with the Company for over 90 days. The Company matches participant contributions of 100% up to 3% of an employees’ salary and 50% of contributions from |
Organization_and_Summary_of_Si1
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||
Use of estimates | Use of estimates | ||||||||||||
The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“US GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates include the allowance for doubtful accounts, inventory reserve, sales returns liability, the useful life of property and equipment, the useful life of intangible assets, stock-based compensation, and income taxes. These estimates and assumptions are based on management’s best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the economic environment, which management believes to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate an adjustment is necessary. | |||||||||||||
Principles of consolidation | Principles of consolidation | ||||||||||||
The consolidated financial statements include the accounts of ZAGG Inc and its wholly owned subsidiaries ZAGG International Distribution Limited (“ZAGG International”), Patriot Corporation, ZAGG Intellectual Property Holding Co, Inc., and ZAGG Retail, Inc. All intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||
At December 31, 2010, HzO, Inc. (“HzO”), a private company engaged in the development of water-blocking technologies for consumer and industrial applications, was consolidated by the Company as a variable interest entity (VIE). On December 22, 2011, HzO entered into an Amended Series B Stock Purchase Agreement with a group of third party investors. ZAGG considered this a reconsideration event and concluded that as of December 22, 2011, HzO should no longer be considered a VIE under authoritative accounting literature, but was considered a voting interest entity. Ultimately, management concluded that HzO should no longer be consolidated into the ZAGG financials as of December 31, 2011. From December 22, 2011 to the fourth quarter of 2013, management accounted for its investment in HzO as an equity method investment. However, during the fourth quarter of 2013, HzO received additional equity financing, in which ZAGG did not participate. As a result of the additional investment, ZAGG’s investment declined below 20% and the investment is now accounted for as a cost method investment. The carrying amount of the investment in HzO was $0 at December 31, 2014 and 2013. | |||||||||||||
Cash equivalents | Cash equivalents | ||||||||||||
The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. Amounts receivable from credit card processors are also considered cash equivalents because they are both short-term and highly liquid in nature and are typically converted to cash within three days of the sales transaction. Amounts receivable from credit card processors at December 31, 2014 and 2013 totaled $120 and $19, respectively. Cash equivalents as of December 31, 2014 and 2013, consisted primarily of money market fund investments and amounts receivable from credit card processors. | |||||||||||||
Fair value measurements | Fair value measurements | ||||||||||||
The Company measures at fair value certain financial and non-financial assets by using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability. The levels of the fair value hierarchy are: | |||||||||||||
Level 1 — Quoted market prices in active markets for identical assets or liabilities; | |||||||||||||
Level 2 — Significant other observable inputs (e.g., quoted prices for similar items in active markets, quoted prices for identical or similar items in markets that are not active, inputs other than quoted prices that are observable such as interest rate and yield curves, and market-corroborated inputs); and | |||||||||||||
Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting unit to develop its own assumptions. | |||||||||||||
Accounts receivable | Accounts receivable | ||||||||||||
The Company sells its products to end users through indirect distribution channels and other resellers who are extended credit terms after an analysis of their financial condition and credit worthiness. Credit terms to distributors and resellers, when extended, are based on evaluation of the customers’ financial condition. Accounts receivable are recorded at invoiced amounts and do not bear interest. | |||||||||||||
The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability of customers to make required payments. Management regularly evaluates the allowance for doubtful accounts considering historical losses adjusted to take into account current market conditions, customers’ financial condition, receivables in dispute, receivables aging, and current payment patterns. Account balances are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Payments subsequently received on written off receivables are credited to bad debt expense in the period of recovery. | |||||||||||||
The following summarizes the activity in the Company’s allowance for doubtful accounts for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
For the Years Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 2,540 | $ | 2,974 | $ | 2,070 | |||||||
Additions charged to expense | 389 | 1,142 | 2,101 | ||||||||||
Write-offs charged against the allowance | (1,019 | ) | (1,576 | ) | (1,197 | ) | |||||||
Balance at end of year | $ | 1,910 | $ | 2,540 | $ | 2,974 | |||||||
Inventories | Inventories | ||||||||||||
Inventories, consisting primarily of finished goods and raw materials, are valued at the lower of cost, determined on a first in, first out basis, or market. Management performs periodic assessments to determine the existence of obsolete, slow moving, and non-saleable inventories, and records necessary write downs in cost of sales to reduce such inventories to net realizable value. Once established, the original cost of the inventory less the related inventory write down represents the new cost basis of such products. | |||||||||||||
Property and equipment | Property and equipment | ||||||||||||
Property and equipment are recorded at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the useful life of the asset or the term of the lease. | |||||||||||||
Major additions and improvements are capitalized, while costs for minor replacements, maintenance and repairs that do not increase the useful life of an asset are expensed as incurred. Upon retirement or other disposition of property and equipment, the cost and related accumulated depreciation or amortization are removed from the accounts. The resulting gain or loss is reflected in selling, general and administrative expense. | |||||||||||||
During the second quarter of 2014, the Company commenced a development project utilizing both internal and external developers to improve the www.ZAGG.com and www.iFrogz.com websites. The development project is intended to provide additional functionality to the websites and will transition the websites to an improved software platform. During the year ended December 31, 2014, the Company capitalized website development costs for internal and external developers totaling $859. These costs are included within property and equipment on the consolidated balance sheet. Depreciation of website development costs begins when the resulting website functionality is ready for its intended use and placed in service; as the project is still in the development stage, no depreciation has been recorded during 2014. Website development costs are included within computer equipment and software in Note 4. | |||||||||||||
Intangibles assets | Intangibles assets | ||||||||||||
Intangible assets include internet addresses, patents, intellectual property, and acquired intangibles in connection with the acquisition of iFrogz, which include customer relationships, trademarks, non-compete agreements, and other miscellaneous intangible assets. | |||||||||||||
Definite-lived intangible assets are amortized over their estimated economic lives, using a straight-line or accelerated method consistent with the underlying expected future cash flows related to the specific intangible asset. Amortization expense is recorded within cost of sales or operating expense depending on the underlying intangible assets. | |||||||||||||
Impairment of long-lived assets | Impairment of long-lived assets | ||||||||||||
Long-lived assets, such as property and equipment, and definite-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, recoverability of long-lived assets is measured by comparison of its carrying amount to the undiscounted cash flows that the asset or asset group is expected to generate over the remaining life in measuring whether the assets are recoverable. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. | |||||||||||||
Contingencies | Contingencies | ||||||||||||
Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. | |||||||||||||
Revenue recognition | Revenue recognition | ||||||||||||
The Company records revenue when persuasive evidence of an arrangement exists, product delivery has occurred, the sales price to the customer is fixed or determinable, and collectability is reasonably assured. The Company’s revenue is derived from sales of our products through our indirect channel, including retailers and distributors; through our direct channel, including www.ZAGG.com, www.iFrogz.com, and our corporate-owned and third-party-owned mall kiosks; and from the franchise fees derived from the onboarding of new franchisees. For product sales, our standard shipping terms are FOB shipping point, and we record revenue when the product is shipped, net of estimated returns and discounts. For some customers, the contractual shipping terms are FOB destination. For these shipments, we record revenue when the product is delivered, net of estimated returns and discounts. For franchise fees, we recognize revenue on a straight-line basis over the franchise term. The Company records revenue from royalty agreements in the period in which the royalty is earned. | |||||||||||||
Promotional products given to customers or potential customers are recognized as a cost of sales. Cash incentives provided to our customers are recognized as a reduction of the related sale price, and, therefore, are a reduction in sales. | |||||||||||||
Allowance for sales returns, warranty, and other credits | Allowance for sales returns, warranty, and other credits | ||||||||||||
For product sales, the Company records revenue, net of estimated returns and discounts, when delivery has occurred, collection of the relevant receivable is reasonably assured, persuasive evidence of an arrangement exists and the sales price is fixed or determinable. Our return policy allows end users and certain retailers rights to return purchased products. In addition, the Company generally provides the ultimate consumer a warranty with each product. Due to the nature of the screen protection product line, end user returns for screen protection are generally not salvageable and are not included in inventory. We estimate a reserve for sales returns, warranty, and other credits, and record the estimated reserve amount as a reduction of sales, and as a sales return reserve liability. When product is returned and is expected to be resold, as is the case with returns of packaged screen protection, keyboards, audio products, cases, and power products, the reserve is recorded as a reduction of revenues and cost of sales, and as a sales return reserve liability. The sales returns and warranty reserve requires management to make estimates regarding return rates for sales and warranty returns. Historical experience, actual claims, and customer return rights are the key factors used in determining the estimated sales return and warranty reserve. | |||||||||||||
The following summarizes the activity in the Company’s sales return and warranty liability for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
For the Year Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 7,872 | $ | 6,697 | $ | 5,387 | |||||||
Additions charged to sales | 35,923 | 30,450 | 28,690 | ||||||||||
Sales returns & warranty claims charged against reserve | (35,121 | ) | (29,275 | ) | (27,380 | ) | |||||||
Balance at end of year | $ | 8,674 | $ | 7,872 | $ | 6,697 | |||||||
Income taxes | Income taxes | ||||||||||||
The Company recognizes deferred income tax assets or liabilities for expected future tax consequences of events that have been recognized in the financial statements or tax returns. Under this method, deferred income tax assets or liabilities are determined based upon the difference between the financial statement and income tax bases of assets and liabilities using enacted tax rates expected to apply when differences are expected to be settled or realized. Deferred income tax assets are reviewed for recoverability and valuation allowances are provided when it is more likely than not that a deferred tax asset will not be realizable in the future. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. | |||||||||||||
The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records estimated interest and penalties related to unrecognized tax benefits, if any, as a component of income tax provision. | |||||||||||||
The Company has foreign subsidiaries that conduct or support its business outside the United States. The Company does not provide for U.S. income taxes on undistributed earnings for its foreign subsidiaries as the foreign earnings will be permanently reinvested in such foreign jurisdictions. | |||||||||||||
Stock-based compensation | Stock-based compensation | ||||||||||||
The Company recognizes stock-based compensation expense in its consolidated financial statements for awards granted to employees and non-employees, which include restricted stock, stock options, and warrants. Equity-classified awards are measured at the grant date fair value of the award. The fair value of restricted stock is measured on the grant date based on the quoted closing market price of the Company’s common stock. The fair value of the stock options is measured on the grant date using the Black-Scholes option pricing model based on the underlying common stock closing price as of the date of grant, the expected term, stock price volatility, and risk-free interest rates. The Company recognizes compensation expense net of estimated forfeitures on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the award. No compensation expense is ultimately recognized for awards for which employees do not render the requisite service and are forfeited. Excess tax benefits of awards that are recognized in equity related to stock option exercises are reflected as financing cash inflows. | |||||||||||||
Advertising and marketing | Advertising and marketing | ||||||||||||
General advertising is expensed as incurred. Advertising allowances provided to retailers are recorded as an expense at the time of the related sale if the Company receives an identifiable benefit in exchange for the consideration and has evidence of fair value for the advertising; otherwise, the allowance is recorded as a reduction of revenue. Advertising expenses for the years ended December 31, 2014, 2013 and 2012 were $7,542, $8,952 and $12,495, respectively. | |||||||||||||
Foreign currency translation and transactions | Foreign currency translation and transactions | ||||||||||||
The Company’s primary operations are at the parent level which uses the U.S. dollar (USD) as its functional currency. The Euro is the functional currency of the Company’s foreign subsidiaries. Accordingly, assets and liabilities for these subsidiaries are translated into USD using exchange rates in effect at the end of each period. Revenue and expenses for these subsidiaries are translated using rates that approximate those in effect during the period. Gains and losses from these translations are recorded as a component of stockholders’ equity. Gains and losses resulting from foreign currency transactions are included in income as a component of other income and (expense) in the consolidated statements of operations and totaled $149, ($7) and ($17) for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||
Earnings per share | Earnings per share | ||||||||||||
Basic earnings per common share excludes dilution and is computed by dividing net income attributable to stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share reflects the potential dilution that could occur if stock options or other common stock equivalents were exercised or converted into common stock. The dilutive effect of stock options or other common stock equivalents is calculated using the treasury stock method. | |||||||||||||
The following is a reconciliation of the numerator and denominator used to calculate basic earnings per share and diluted earnings per share for the years ended December 31, 2014, 2013 and 2012: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income attributable to stockholders | $ | 10,461 | $ | 4,790 | $ | 14,505 | |||||||
Weighted average shares outstanding | 30,247 | 30,900 | 30,339 | ||||||||||
Dilutive effect of stock options, restricted stock, and warrants | 363 | 559 | 1,317 | ||||||||||
Weighted average diluted shares | 30,610 | 31,459 | 31,656 | ||||||||||
Earnings per share attributable to stockholders: | |||||||||||||
Basic | $ | 0.35 | $ | 0.16 | $ | 0.48 | |||||||
Dilutive | $ | 0.34 | $ | 0.15 | $ | 0.46 | |||||||
For the years ended December 31, 2014, 2013, and 2012, restricted stock, warrants and stock options to purchase 485, 620, and 169 shares of common stock, respectively, were not considered in calculating diluted earnings per share because the warrant or stock option exercise prices or the total expected proceeds under the treasury stock method for the warrants, restricted stock, or stock options was greater than the average market price of common shares during the period and, therefore, the effect would be anti-dilutive. | |||||||||||||
Recent accounting pronouncements | Recent accounting pronouncements | ||||||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” This ASU includes a five-step process by which entities will recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration to which an entity expects to be entitled to in exchange for those goods or services. The ASU also will require enhanced disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The ASU is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption prohibited. We are currently evaluating the impact this ASU will have on our consolidated financial statements. | |||||||||||||
In August 2014, the FASB issued ASU No. 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” This ASU describes how an entity should assess its ability to meet obligations and sets disclosure requirements for how this information should be disclosed in the financial statements. The standard provides accounting guidance that will be used with existing auditing standards. The ASU applies to all entities for the first annual period ending after December 15, 2016, and interim periods thereafter. This ASU is not expected to have a significant impact on the Company’s consolidated financial statements. |
Organization_and_Summary_of_Si2
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||
Schedule of allowance for doubtful accounts activity | For the Years Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 2,540 | $ | 2,974 | $ | 2,070 | |||||||
Additions charged to expense | 389 | 1,142 | 2,101 | ||||||||||
Write-offs charged against the allowance | (1,019 | ) | (1,576 | ) | (1,197 | ) | |||||||
Balance at end of year | $ | 1,910 | $ | 2,540 | $ | 2,974 | |||||||
Schedule of sales return and warranty liability activity | For the Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Balance at beginning of year | $ | 7,872 | $ | 6,697 | $ | 5,387 | |||||||
Additions charged to sales | 35,923 | 30,450 | 28,690 | ||||||||||
Sales returns & warranty claims charged against reserve | (35,121 | ) | (29,275 | ) | (27,380 | ) | |||||||
Balance at end of year | $ | 8,674 | $ | 7,872 | $ | 6,697 | |||||||
Schedule of reconciliation of the numerator and denominator used to calculate basic earnings per share and diluted earnings per share | 2014 | 2013 | 2012 | ||||||||||
Net income attributable to stockholders | $ | 10,461 | $ | 4,790 | $ | 14,505 | |||||||
Weighted average shares outstanding | 30,247 | 30,900 | 30,339 | ||||||||||
Dilutive effect of stock options, restricted stock, and warrants | 363 | 559 | 1,317 | ||||||||||
Weighted average diluted shares | 30,610 | 31,459 | 31,656 | ||||||||||
Earnings per share attributable to stockholders: | |||||||||||||
Basic | $ | 0.35 | $ | 0.16 | $ | 0.48 | |||||||
Dilutive | $ | 0.34 | $ | 0.15 | $ | 0.46 | |||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Inventories [Abstract] | |||||||||
Schedule of summary of inventories | December 31, | ||||||||
2014 | 2013 | ||||||||
Finished goods | $ | 48,145 | $ | 40,992 | |||||
Raw materials | 233 | 3,547 | |||||||
Total inventory | $ | 48,378 | $ | 44,539 | |||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Property and Equipment [Abstract] | |||||||||||||
Schedule of property and equipment | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Useful Lives | |||||||||||||
Computer equipment and software | 3 to 5 years | $ | 2,627 | $ | 1,519 | ||||||||
Equipment and molds | 3 to 10 years | 8,238 | 5,173 | ||||||||||
Furniture and fixtures | 7 years | 770 | 778 | ||||||||||
Automobiles | 5 years | 234 | 201 | ||||||||||
Leasehold improvements | 1 to 4.75 years | 3,090 | 3,111 | ||||||||||
14,959 | 10,782 | ||||||||||||
Less accumulated depreciation | (7,659 | ) | (5,778 | ) | |||||||||
Net property and equipment | $ | 7,300 | $ | 5,004 | |||||||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Schedule of changes in the carrying amount of goodwill | 2013 | 2012 | |||||||||||||||||||||||
Balance as of January 1 | |||||||||||||||||||||||||
Gross goodwill | $ | 6,925 | $ | 6,925 | |||||||||||||||||||||
Accumulated impairment losses | (5,441 | ) | — | ||||||||||||||||||||||
Net goodwill as of January 1 | 1,484 | 6,925 | |||||||||||||||||||||||
Goodwill acquired during the year | — | — | |||||||||||||||||||||||
Impairment loss | (1,484 | ) | (5,441 | ) | |||||||||||||||||||||
Balance as of December 31 | |||||||||||||||||||||||||
Gross goodwill | 6,925 | 6,925 | |||||||||||||||||||||||
Accumulated impairment losses | (6,925 | ) | (5,441 | ) | |||||||||||||||||||||
Net goodwill as of December 31 | $— | $ | 1,484 | ||||||||||||||||||||||
Schedule of definite-lived intangibles | As of December 31, 2014 | ||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Write-off of Fully Amortized Asset | Transfers from Indefinite-life Classification | Net Carrying Amount | Weighted Average Amortization Period | ||||||||||||||||||||
Customer relationships | $ | 41,500 | $ | (23,839 | ) | $ | — | $ | — | $ | 17,661 | 8.0 years | |||||||||||||
Non-compete agreements | 4,100 | (2,949 | ) | — | — | 1,151 | 4.8 years | ||||||||||||||||||
Other Trademarks | 3,500 | (2,216 | ) | — | — | 1,284 | 9.7 years | ||||||||||||||||||
iFrogz Trademark | 7,038 | (1,152 | ) | — | — | 5,886 | 10.0 years | ||||||||||||||||||
EarPollution Trademark | 2,383 | (1,026 | ) | — | — | 1,357 | 8.0 years | ||||||||||||||||||
Other | 600 | (554 | ) | — | — | 46 | 5.0 years | ||||||||||||||||||
Acquired technology | 709 | (267 | ) | — | — | 442 | 7.0 years | ||||||||||||||||||
Internet address | 124 | (78 | ) | — | — | 46 | 10.0 years | ||||||||||||||||||
Patents | 4,696 | (1,161 | ) | — | — | 3,535 | 12.5-14.0 years | ||||||||||||||||||
Total amortizable assets | $ | 64,650 | $ | (33,242 | ) | $ | — | $ | — | $ | 31,408 | 8.4 years | |||||||||||||
As of December 31, 2013 | |||||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Write-off of Fully Amortized Asset | Transfers from Indefinite-life Classification | Net Carrying Amount | Weighted Average Amortization Period | ||||||||||||||||||||
Customer relationships | $ | 41,500 | $ | (17,537 | ) | $ | — | $ | — | $ | 23,963 | 8.0 years | |||||||||||||
Non-compete agreements | 4,100 | (2,169 | ) | — | — | 1,931 | 4.8 years | ||||||||||||||||||
Other Trademarks | 3,500 | (1,719 | ) | — | — | 1,781 | 9.7 years | ||||||||||||||||||
iFrogz Trademark | — | — | — | 7,038 | 7,038 | 10.0 years | |||||||||||||||||||
EarPollution Trademark | 2,383 | (554 | ) | — | — | 1,829 | 8.0 years | ||||||||||||||||||
Other | 661 | (487 | ) | (61 | ) | — | 113 | 5.0 years | |||||||||||||||||
Acquired technology | 709 | (165 | ) | — | — | 544 | 7.0 years | ||||||||||||||||||
Internet address | 124 | (66 | ) | — | — | 58 | 10.0 years | ||||||||||||||||||
Patents | 4,696 | (734 | ) | — | — | 3,962 | 12.5-14.0 years | ||||||||||||||||||
Total amortizable assets | $ | 57,673 | $ | (23,431 | ) | $ | (61 | ) | $ | 7,038 | $ | 41,219 | 8.4 years | ||||||||||||
Schedule of estimated future amortization expense | 2015 | $ | 8,560 | ||||||||||||||||||||||
2016 | 7,125 | ||||||||||||||||||||||||
2017 | 5,649 | ||||||||||||||||||||||||
2018 | 4,626 | ||||||||||||||||||||||||
Thereafter | 5,448 | ||||||||||||||||||||||||
Total | $ | 31,408 | |||||||||||||||||||||||
Ifrogz Trademark [Member] | |||||||||||||||||||||||||
Schedule of finite lived intangible assets trade mark future amortization expense | 31-Dec-13 | ||||||||||||||||||||||||
iFrogz trademark prior to impairment | $ | 16,800 | |||||||||||||||||||||||
iFrogz trademark impairment | (9,762 | ) | |||||||||||||||||||||||
iFrogz trademark – definite-lived | $ | 7,038 | |||||||||||||||||||||||
Ear Pollution Trademark [Member] | |||||||||||||||||||||||||
Schedule of finite lived intangible assets trade mark future amortization expense | December 31 | ||||||||||||||||||||||||
2012 | |||||||||||||||||||||||||
EarPollution trademark prior to impairment | $ | 8,300 | |||||||||||||||||||||||
EarPollution trademark impairment | (5,917 | ) | |||||||||||||||||||||||
EarPollution trademark – definite-lived | $ | 2,383 | |||||||||||||||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Summary of provision for (benefit from) income taxes | 2014 | 2013 | 2012 | ||||||||||
Current (provision): | |||||||||||||
Federal | $ | (9,705 | ) | $ | (8,720 | ) | $ | (15,466 | ) | ||||
State | (2,502 | ) | (766 | ) | (2,104 | ) | |||||||
Foreign | (37 | ) | — | (116 | ) | ||||||||
Total current | (12,244 | ) | (9,486 | ) | (17,686 | ) | |||||||
Deferred (provision) benefit: | |||||||||||||
Federal\ | 4,144 | 5,036 | 7,209 | ||||||||||
State | 1,627 | 755 | 1,084 | ||||||||||
Foreign | — | — | — | ||||||||||
Total deferred | 5,771 | 5,791 | 8,293 | ||||||||||
Total (provision) benefit | $ | (6,473 | ) | $ | (3,695 | ) | $ | (9,393 | ) | ||||
Schedule of effective income tax rate reconciliation | 2014 | 2013 | 2012 | ||||||||||
Tax at statutory rate (35%) | $ | (5,927 | ) | $ | (2,970 | ) | $ | (8,364 | ) | ||||
State tax, net of federal tax benefit | (955 | ) | 25 | (663 | ) | ||||||||
Non-deductible expense and other | (680 | ) | 428 | (341 | ) | ||||||||
Domestic production activities deduction | 688 | 331 | 676 | ||||||||||
Return to provision adjustment | 453 | (148 | ) | (49 | ) | ||||||||
Liquidation of iFrogz EU | — | 5 | — | ||||||||||
Reserve related to FIN 48 | (541 | ) | (382 | ) | — | ||||||||
Interest and penalties | (37 | ) | (32 | ) | — | ||||||||
Effect of state rate changes, net of federal tax benefit | 526 | — | — | ||||||||||
Increase in valuation allowance | — | (952 | ) | (652 | ) | ||||||||
$ | (6,473 | ) | $ | (3,695 | ) | $ | (9,393 | ) | |||||
Summary of deferred tax assets and liabilities | 2014 | 2013 | |||||||||||
Deferred tax assets: | |||||||||||||
Allowance for doubtful accounts | $ | 729 | $ | 958 | |||||||||
Deferred revenue | 12 | 38 | |||||||||||
Inventories | 5,584 | 3,211 | |||||||||||
Stock-based compensation | 1,825 | 1,464 | |||||||||||
Sales returns accrual | 3,374 | 2,943 | |||||||||||
Acquisition costs, net of amortization | 238 | 252 | |||||||||||
Intangible assets | 11,708 | 8,320 | |||||||||||
Goodwill | 2,067 | 2,192 | |||||||||||
HzO investment | 1,520 | 1,483 | |||||||||||
Capital loss carry-over | 278 | 271 | |||||||||||
Reserve on note receivable | 583 | 569 | |||||||||||
Other liabilities | 66 | 39 | |||||||||||
Deferred tax assets | 27,984 | 21,740 | |||||||||||
Valuation allowance | (1,798 | ) | (1,753 | ) | |||||||||
Total deferred tax assets | $ | 26,186 | $ | 19,987 | |||||||||
Deferred tax liabilities: | |||||||||||||
Property and equipment | 1,122 | 693 | |||||||||||
Total gross deferred tax liabilities | 1,122 | 693 | |||||||||||
Net deferred tax assets | $ | 25,064 | $ | 19,294 | |||||||||
Deferred tax assets, net – current | $ | 10,774 | $ | 7,917 | |||||||||
Deferred tax assets, net – noncurrent | 14,290 | 11,377 | |||||||||||
Net deferred tax assets | $ | 25,064 | $ | 19,294 | |||||||||
Schedule of unrecognized tax benefits | |||||||||||||
2014 | 2013 | ||||||||||||
Unrecognized tax benefits, as of January 1 | $ | 460 | $ | 61 | |||||||||
Gross increases – tax positions in current period | 541 | 399 | |||||||||||
Total benefit | $ | 1,001 | $ | 460 | |||||||||
Stock_Options_Warrants_and_Res1
Stock Options Warrants and Restricted Stock (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Stock Options Warrants and Restricted Stock [Abstract] | |||||||||||||||||||
Schedule of stock option activity | Weighted- | ||||||||||||||||||
Average | Net | ||||||||||||||||||
Weighted- | Remaining | Aggregate | |||||||||||||||||
Average | Contractual | Intrinsic | |||||||||||||||||
Options | Exercise Price | Term | Value | ||||||||||||||||
(In thousands) | (Per share) | (In years) | (In thousands) | ||||||||||||||||
Outstanding at December 31, 2013 | 439 | $ | 3.61 | 1.2 | $ | 186 | |||||||||||||
Exercised | -149 | 1.83 | |||||||||||||||||
Forfeited/expired | -5 | 4.12 | |||||||||||||||||
Outstanding at December 31, 2014 | 285 | $ | 5.02 | 0.6 | $ | 504 | |||||||||||||
Exercisable at December 31, 2014 | 285 | $ | 5.02 | 0.6 | $ | 504 | |||||||||||||
Schedule of valuation assumptions of warrants | |||||||||||||||||||
2012 | |||||||||||||||||||
Expected dividend yield | 0 | % | |||||||||||||||||
Risk-free interest rate | 0.81 | % | |||||||||||||||||
Expected term (years) | 5.0 years | ||||||||||||||||||
Expected volatility | 89.5 | % | |||||||||||||||||
Schedule of warrant activity | |||||||||||||||||||
Warrants | Weighted- | ||||||||||||||||||
Average | Net | ||||||||||||||||||
Weighted- | Remaining | Aggregate | |||||||||||||||||
Average | Contractual | Intrinsic | |||||||||||||||||
Exercise Price | Term | Value | |||||||||||||||||
(In thousands) | (Per share) | (In years) | (In thousands) | ||||||||||||||||
Outstanding at December 31, 2013 | 390 | $ | 8.05 | 2 | $ | (1,442 | ) | ||||||||||||
Granted | — | — | |||||||||||||||||
Exercised | -5 | 2.58 | |||||||||||||||||
Forfeited/expired | — | — | |||||||||||||||||
Outstanding at December 31, 2014 | 385 | $ | 8.12 | 1 | $ | (512 | ) | ||||||||||||
Exercisable at December 31, 2014 | 385 | $ | 8.12 | 1 | $ | (512 | ) | ||||||||||||
Schedule of restricted stock activity | Restricted | Weighted- | |||||||||||||||||
Stock | Average | ||||||||||||||||||
Grant Date | |||||||||||||||||||
Fair Value | |||||||||||||||||||
(In thousands) | (Per share) | ||||||||||||||||||
Outstanding at December 31, 2013 | 357 | $ | 5.96 | ||||||||||||||||
Granted | 589 | 4.83 | |||||||||||||||||
Vested | (218 | ) | 6.38 | ||||||||||||||||
Forfeited | (101 | ) | 5.49 | ||||||||||||||||
Outstanding at December 31, 2014 | 627 | $ | 4.83 |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Fair Value Measures [Abstract] | |||||||||||||||||
Schedule of assets and liabilities measured at fair value on a recurring basis | |||||||||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-14 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Money market funds included in cash equivalents | $ | 374 | $ | 374 | — | — | |||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-13 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Money market funds included in cash equivalents | $ | 163 | $ | 163 | — | — | |||||||||||
Schedule of assets measured at fair value on a non-recurring basis | |||||||||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-13 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Goodwill | $ | — | — | — | $ | — | |||||||||||
iFrogz trademark | $ | 7,038 | — | — | $ | 7,038 | |||||||||||
Fair Value Measurements Using: | |||||||||||||||||
31-Dec-12 | Level 1 Inputs | Level 2 Inputs | Level 3 Inputs | ||||||||||||||
Goodwill | $ | 1,484 | — | — | $ | 1,484 | |||||||||||
EarPollution trademark | $ | 2,383 | — | — | $ | 2,383 | |||||||||||
Debt_and_Letters_of_Credit_Tab
Debt and Letters of Credit (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Debt and Letters of Credit [Abstract] | |||||
Schedule of total liabilities to tangible net worth ratio | Total Liabilities to Tangible Net Worth | Applicable LIBOR Margin | |||
1.00 or greater | 1.25 | % | |||
0.65 or greater, but less than 1.00 | 1 | % | |||
Less than 0.65 | 0.75 | % | |||
Schedule of line of credit depending on leverage ratio | Leverage Ratio | Applicable Unused Commitment Fee (per annum) | |||
1.00 or greater | 0.35 | % | |||
0.65 or greater, but less than 1.00 | 0.25 | % | |||
Less than 0.65 | 0.15 | % | |||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||
Dec. 31, 2014 | |||||||
Commitments and Contingencies [Abstract] | |||||||
Schedule of future minimum rental payments required under the operating leases | |||||||
2015 | $ | 912 | |||||
2016 | 767 | ||||||
2017 | 376 | ||||||
Total | $ | 2,055 | |||||
Concentrations_Tables
Concentrations (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Concentrations [Abstract] | |||||||||||||
Schedule of percentage of sales by geographic region | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | 90 | % | 90 | % | 87 | % | |||||||
Europe | 7 | % | 5 | % | 6 | % | |||||||
Other | 3 | % | 5 | % | 7 | % |
Quarterly_Financial_Data_Unaud1
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||||||
Schedule of Quarterly Financial Information [Table Text Block] | Year ended December 31, 2014 | ||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Year | |||||||||||||||||
Net sales | $ | 49,003 | $ | 50,154 | $ | 60,013 | $ | 102,415 | $ | 261,585 | |||||||||||
Income (loss) from operations | 1,940 | 1,580 | (6,611 | ) | 20,074 | 16,983 | |||||||||||||||
Net income (loss) | 988 | 793 | (4,319 | ) | 12,999 | 10,461 | |||||||||||||||
Earnings (loss) per share attributable to stockholders: (1) | |||||||||||||||||||||
Basic | $ | 0.03 | $ | 0.03 | $ | (0.14 | ) | $ | 0.44 | $ | 0.35 | ||||||||||
Diluted | 0.03 | 0.03 | (0.14 | ) | 0.43 | 0.34 | |||||||||||||||
Weighted average common shares: | |||||||||||||||||||||
Basic | 30,549 | 30,281 | 30,312 | 29,854 | 30,247 | ||||||||||||||||
Diluted | 30,864 | 30,575 | 30,312 | 30,288 | 30,610 | ||||||||||||||||
Year ended December 31, 2013 | |||||||||||||||||||||
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | Year | |||||||||||||||||
Net sales | $ | 51,471 | $ | 51,198 | $ | 49,869 | $ | 66,818 | $ | 219,356 | |||||||||||
Income (loss) from operations | 2,007 | 5,416 | 6,435 | (2,912 | ) | 10,946 | |||||||||||||||
Net income (loss) | 876 | 2,774 | 3,184 | (2,044 | ) | 4,790 | |||||||||||||||
Earnings (loss) per share attributable to stockholders: (1) | |||||||||||||||||||||
Basic | $ | 0.03 | $ | 0.09 | $ | 0.1 | $ | (0.07 | ) | $ | 0.16 | ||||||||||
Diluted | 0.03 | 0.09 | 0.1 | (0.07 | ) | 0.15 | |||||||||||||||
Weighted average common shares: | |||||||||||||||||||||
Basic | 31,052 | 30,739 | 30,926 | 30,883 | 30,900 | ||||||||||||||||
Diluted | 31,726 | 31,218 | 31,466 | 30,883 | 31,459 | ||||||||||||||||
-1 | The earnings per share calculations for each of the quarters were based upon the weighted average number of shares outstanding during each period, and the sum of the quarters may not be equal to the full year earnings per common share amounts. |
Organization_and_Summary_of_Si3
Organization and Summary of Significant Accounting Policies (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Organization and Summary of Significant Accounting Policies [Abstract] | |||
Balance at beginning of year | $2,540 | $2,974 | $2,070 |
Additions charged to expense | 389 | 1,142 | 2,101 |
Write-offs charged against the allowance | -1,019 | -1,576 | -1,197 |
Balance at end of year | $1,910 | $2,540 | $2,974 |
Organization_and_Summary_of_Si4
Organization and Summary of Significant Accounting Policies (Details 1) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Organization and Summary of Significant Accounting Policies [Abstract] | |||
Balance at beginning of year | $7,872 | $6,697 | $5,387 |
Additions charged to sales | 35,923 | 30,450 | 28,690 |
Sales returns & warranty claims charged against reserve | -35,121 | -29,275 | -27,380 |
Balance at end of year | $8,674 | $7,872 | $6,697 |
Organization_and_Summary_of_Si5
Organization and Summary of Significant Accounting Policies (Details 2) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||
Net income attributable to stockholders | $12,999 | ($4,319) | $793 | $988 | ($2,044) | $3,184 | $2,774 | $876 | $10,461 | $4,790 | $14,505 | ||||||||
Weighted average shares outstanding | 29,854 | 30,312 | 30,281 | 30,549 | 30,883 | 30,926 | 30,739 | 31,052 | 30,247 | 30,900 | 30,339 | ||||||||
Dilutive effect of stock options, restricted stock, and warrants | 0 | 540 | 363 | 559 | 1,317 | ||||||||||||||
Weighted average diluted shares | 30,288 | 30,312 | 30,575 | 30,864 | 30,883 | 31,466 | 31,218 | 31,726 | 30,610 | 31,459 | 31,656 | ||||||||
Earnings per share attributable to stockholders: | |||||||||||||||||||
Basic | $0.44 | [1] | ($0.14) | [1] | $0.03 | [1] | $0.03 | [1] | ($0.07) | [1] | $0.10 | [1] | $0.09 | [1] | $0.03 | [1] | $0.35 | $0.16 | $0.48 |
Dilutive | $0.43 | [1] | ($0.14) | [1] | $0.03 | [1] | $0.03 | [1] | ($0.07) | [1] | $0.10 | [1] | $0.09 | [1] | $0.03 | [1] | $0.34 | $0.15 | $0.46 |
[1] | The earnings per share calculations for each of the quarters were based upon the weighted average number of shares outstanding during each period, and the sum of the quarters may not be equal to the full year earnings per common share amounts. |
Organization_and_Summary_of_Si6
Organization and Summary of Significant Accounting Policies (Details Textual) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 21, 2011 |
Business Acquisition [Line Items] | ||||
Amounts receivable from credit card processors | $120 | $19 | ||
Percentage of investment decline | 20.00% | |||
Investment in HzO | 0 | 0 | ||
Tax benefits recognized provided percentage of likelihood of realization more than | 50.00% | |||
Advertising expense | 7,542 | 8,952 | 12,495 | |
Gains (losses) from foreign currency transactions | 149 | -7 | -17 | |
Website development cost | $859 | |||
Restricted Stock [Member] | ||||
Business Acquisition [Line Items] | ||||
Shares excluded from computation of diluted earnings per share | 485 | |||
Warrant [Member] | ||||
Business Acquisition [Line Items] | ||||
Shares excluded from computation of diluted earnings per share | 620 | |||
Stock Option [Member] | ||||
Business Acquisition [Line Items] | ||||
Shares excluded from computation of diluted earnings per share | 169 | |||
iFrogz [Member] | ||||
Business Acquisition [Line Items] | ||||
Percentage of acquired outstanding shares of iFrogz | 100.00% | |||
Maturity term | Three months or less |
Inventories_Details
Inventories (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventories [Abstract] | ||
Finished goods | $48,145 | $40,992 |
Raw materials | 233 | 3,547 |
Total inventory | $48,378 | $44,539 |
Inventories_Details_Textual
Inventories (Details Textual) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Purchase of raw material | $455 | |
Prepaid expenses and other current assets | $1,425 | $735 |
Investment_in_HzO_Details_Text
Investment in HzO (Details Textual) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Variable Interest Entity [Line Items] | |||
Loss from equity method investment in HzO | ($2,013) | ($2,866) | |
HzO, Inc | |||
Variable Interest Entity [Line Items] | |||
Percentage of equity method investment ownership | 10.10% | 15.30% | |
Reduced ownership interest | 20.00% | ||
Ownership interest, Description | HzO raised an additional $20,000 in equity capital. ZAGG did not participate in the capital raise. Due to this equity raise and 2014 option exercises at HzO, ZAGG's ownership interest in HzO decreased from 15.3% at December 31, 2013 to 10.1% at December 31, 2014. | ||
Carrying value of the investment | $0 | $0 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $14,959 | $10,782 |
Less accumulated depreciation | -7,659 | -5,778 |
Net property and equipment | 7,300 | 5,004 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,627 | 1,519 |
Computer equipment and software | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 3 years | |
Computer equipment and software | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 5 years | |
Equipment and molds | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 8,238 | 5,173 |
Equipment and molds | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 3 years | |
Equipment and molds | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 10 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 770 | 778 |
Useful Lives | 7 years | |
Automobiles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 234 | 201 |
Useful Lives | 5 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $3,090 | $3,111 |
Leasehold improvements | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 1 year | |
Leasehold improvements | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives | 4 years 9 months |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Roll Forward] | ||
Grpss goodwill, Beginning Balance | $6,925 | $6,925 |
Accumulated impairment losses, Beginning Balance | -5,441 | |
Net goodwill, Beginning Balance | 1,484 | 6,925 |
Goodwill acquired during the year | ||
Impairment loss | -1,484 | -5,441 |
Gross goodwill, Ending Balance | 6,925 | 6,925 |
Accumulated impairment losses, Ending Balance | -6,925 | -5,441 |
Net goodwill, Ending Balance | $1,484 |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets (Details 1) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | |||
Finite-Lived Intangible Assets [Line Items] | |||
Definite-lived | $31,408 | $41,219 | |
Ear Pollution Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Trademark prior to impairment | 8,300 | ||
Trademark impairment | -5,917 | ||
Definite-lived | 1,357 | 1,829 | 2,383 |
Ifrogz Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Trademark prior to impairment | 16,800 | ||
Trademark impairment | -9,762 | ||
Definite-lived | $7,038 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $64,650 | $57,673 | |
Accumulated Amortization | -33,242 | -23,431 | |
Write-off of Fully Amortized Intangible | -61 | ||
Transfers from Indefinite-life Classification | 7,038 | ||
Net Carrying Amount | 31,408 | 41,219 | |
Weighted Average Amortization Period | 8 years 4 months 24 days | 8 years 4 months 24 days | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 41,500 | 41,500 | |
Accumulated Amortization | -23,839 | -17,537 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 17,661 | 23,963 | |
Weighted Average Amortization Period | 8 years | 8 years | |
Non-compete agreements | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 4,100 | 4,100 | |
Accumulated Amortization | -2,949 | -2,169 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 1,151 | 1,931 | |
Weighted Average Amortization Period | 4 years 9 months 18 days | 4 years 9 months 18 days | |
Other Trademarks | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 3,500 | 3,500 | |
Accumulated Amortization | -2,216 | -1,719 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 1,284 | 1,781 | |
Weighted Average Amortization Period | 9 years 8 months 12 days | 9 years 8 months 12 days | |
iFrogz Trademark | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 7,038 | ||
Accumulated Amortization | -1,152 | ||
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | 7,038 | ||
Net Carrying Amount | 5,886 | 7,038 | |
Weighted Average Amortization Period | 10 years | 10 years | |
EarPollution Trademark | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 2,383 | 2,383 | |
Accumulated Amortization | -1,026 | -554 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 1,357 | 1,829 | 2,383 |
Weighted Average Amortization Period | 8 years | 8 years | |
Other | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 600 | 661 | |
Accumulated Amortization | -554 | -487 | |
Write-off of Fully Amortized Intangible | -61 | ||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 46 | 113 | |
Weighted Average Amortization Period | 5 years | 5 years | |
Acquired technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 709 | 709 | |
Accumulated Amortization | -267 | -165 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 442 | 544 | |
Weighted Average Amortization Period | 7 years | 7 years | |
Internet address | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 124 | 124 | |
Accumulated Amortization | -78 | -66 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | 46 | 58 | |
Weighted Average Amortization Period | 10 years | 10 years | |
Patents | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 4,696 | 4,696 | |
Accumulated Amortization | -1,161 | -734 | |
Write-off of Fully Amortized Intangible | |||
Transfers from Indefinite-life Classification | |||
Net Carrying Amount | $3,535 | $3,962 | |
Patents | Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 12 years 6 months | 12 years 6 months | |
Patents | Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period | 14 years | 14 years |
Goodwill_and_Intangible_Assets5
Goodwill and Intangible Assets (Details 3) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Goodwill and Intangible Assets [Abstract] | |
2015 | $8,560 |
2016 | 7,125 |
2017 | 5,649 |
2018 | 4,626 |
Thereafter | 5,448 |
Total | $31,408 |
Goodwill_and_Intangible_Assets6
Goodwill and Intangible Assets (Details Textual) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | ($1,484) | ($5,441) | |
Amortization expenses | 9,709 | 9,620 | 9,732 |
Internally developed acquired software wrote-off | 61 | ||
Period for amortization | 8 years 4 months 24 days | 8 years 4 months 24 days | |
Acquired technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | 102 | 82 | 69 |
Internally developed acquired software wrote-off | |||
Period for amortization | 7 years | 7 years | |
Ifrogz Trademarks [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | 9,762 | ||
Internally developed acquired software wrote-off | |||
Period for amortization | 10 years | 10 years | |
Ear Pollution Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Impairment loss | 5,917 | ||
Internally developed acquired software wrote-off | |||
Period for amortization | 8 years | 8 years | |
Remaining Definite Lived Intangible Asset [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | $9,811 | $9,702 | $9,801 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Current (provision): | |||
Federal | ($9,705) | ($8,720) | ($15,466) |
State | -2,502 | -766 | -2,104 |
Foreign | -37 | -116 | |
Total current | -12,244 | -9,486 | -17,686 |
Deferred (provision) benefit: | |||
Federal\ | 4,144 | 5,036 | 7,209 |
State | 1,627 | 755 | 1,084 |
Foreign | |||
Total deferred | 5,770 | 5,787 | 8,293 |
Income tax benefit (provision) | $6,473 | $3,695 | $9,393 |
Income_Taxes_Details_1
Income Taxes (Details 1) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Taxes [Abstract] | |||
Tax at statutory rate (35%) | ($5,927) | ($2,970) | ($8,364) |
State tax, net of federal tax benefit | -955 | 25 | -663 |
Non-deductible expense and other | -680 | 428 | -341 |
Domestic production activities deduction | 688 | 331 | 676 |
Return to provision adjustment | 453 | -148 | -49 |
Liquidation of iFrogz EU | 5 | ||
Reserve related to FIN 48 | -541 | -382 | |
Interest and penalties | -37 | -32 | |
Effect of state rate changes, net of federal tax benefit | 526 | ||
Increase in valuation allowance | -952 | -652 | |
Income tax benefit (provision) | $6,473 | $3,695 | $9,393 |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ||
Allowance for doubtful accounts | $729 | $958 |
Deferred revenue | 12 | 38 |
Inventories | 5,584 | 3,211 |
Stock-based compensation | 1,825 | 1,464 |
Sales returns accrual | 3,374 | 2,943 |
Acquisition costs, net of amortization | 238 | 252 |
Intangible assets | 11,708 | 8,320 |
Goodwill | 2,067 | 2,192 |
HzO investment | 1,520 | 1,483 |
Capital loss carry-over | 278 | 271 |
Reserve on note receivable | 583 | 569 |
Other liabilities | 66 | 39 |
Deferred tax assets | 27,984 | 21,740 |
Valuation allowance | -1,798 | -1,753 |
Total deferred tax assets | 26,186 | 19,987 |
Deferred tax liabilities: | ||
Property and equipment | 1,122 | 693 |
Total gross deferred tax liabilities | 1,122 | 693 |
Net deferred tax assets | 25,064 | 19,294 |
Deferred tax assets, net - current | 10,774 | 7,917 |
Deferred tax assets, net - noncurrent | 14,290 | 11,377 |
Net deferred tax assets | $25,064 | $19,294 |
Income_Taxes_Details_3
Income Taxes (Details 3) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Income Taxes [Abstract] | ||
Unrecognized tax benefits, as of January 1 | $460 | $61 |
Gross increases - tax positions in current period | 541 | 399 |
Total benefit | $1,001 | $460 |
Income_Taxes_Details_Textual
Income Taxes (Details Textual) (USD $) | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 |
Income Taxes Textual [Abstract] | |||||
Federal statutory rate | 35.00% | ||||
Deferred tax assets, valuation allowance | $1,798 | $1,753 | |||
Change in valuation allowance | 45 | 45 | |||
Cash held by foreign entities permanently reinvested | 5,036 | ||||
Tax contingency | 1,001 | 460 | |||
Unrecognized tax benefits | 1,001 | 460 | 61 | ||
Unrecognized tax benefits that would impact effective tax rate | 959 | ||||
Income Tax Interest and Penalties | 38 | 32 | 0 | ||
Income taxes payable | 146 | 146 | |||
HzO, Inc | |||||
Income Taxes Textual [Abstract] | |||||
Deferred tax assets, valuation allowance | $1,520 | $1,483 |
Stock_Options_Warrants_and_Res2
Stock Options Warrants and Restricted Stock (Details) (Stock options [Member], USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Stock options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Outstanding at December 31, 2013 | 439 | |
Exercised | -149 | |
Forfeited/expired | -5 | |
Outstanding at December 31, 2014 | 285 | 439 |
Exercisable at December 31, 2014 | 285 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Stock option outstanding, Weighted-Average Remaining Contractual Term | 7 months 6 days | 1 year 2 months 12 days |
Stock option exercisable, Weighted-Average Remaining Contractual Term | 7 months 6 days | |
Stock option outstanding, Aggregate Intrinsic Value | $504 | $186 |
Stock option exercisable, Aggregate Intrinsic Value | $504 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Outstanding at December 31, 2013 | $3.61 | |
Exercised | $1.83 | |
Forfeited/expired | $4.12 | |
Outstanding at December 31, 2014 | $5.02 | $3.61 |
Exercisable at December 31, 2014 | $5.02 |
Stock_Options_Warrants_and_Res3
Stock Options Warrants and Restricted Stock (Details 1) (Warrant [Member]) | 12 Months Ended |
Dec. 31, 2012 | |
Warrant [Member] | |
Class of Warrant or Right [Line Items] | |
Expected dividend yield | 0.00% |
Risk-free interest rate | 0.81% |
Expected term (years) | 5 years |
Expected volatility | 89.50% |
Stock_Options_Warrants_and_Res4
Stock Options Warrants and Restricted Stock (Details 2) (Warrant [Member], USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Warrant [Member] | ||
Warrants Outstanding Rollforward [Abstract] | ||
Outstanding at December 31, 2013 | 390 | |
Granted | ||
Exercised | -5 | |
Forfeited/expired | ||
Outstanding at December 31, 2014 | 385 | 390 |
Exercisable at December 31, 2014 | 385 | |
Class Of Warrant Or Right Outstanding Weighted Average Exercise Price Rollforward [Abstract] | ||
Outstanding at December 31, 2013 | 8.05 | |
Granted | ||
Exercised | $2.58 | |
Forfeited/expired | ||
Outstanding at December 31, 2014 | 8.12 | 8.05 |
Exercisable at December 31, 2014 | 8.12 | |
Class Of Warrant Or Right Additional Disclosures [Abstract] | ||
Warrants Outstanding, Weighted-Average Remaining Contractual Term | 1 year | 2 years |
Warrants Exercisable, Weighted-Average Remaining Contractual Term | 1 year | |
Warrants Outstanding, Aggregate Intrinsic Value | ($512) | ($1,442) |
Warrants Exercisable, Aggregate Intrinsic Value | ($512) |
Stock_Options_Warrants_and_Res5
Stock Options Warrants and Restricted Stock (Details 3) (Restricted Stock [Member], USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 |
Restricted Stock [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at December 31, 2013 | 357 |
Granted | 589 |
Vested | -218 |
Forfeited | -101 |
Outstanding at December 31, 2014 | 627 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Outstanding at December 31, 2013 | $5.96 |
Granted | $4.83 |
Vested | $6.38 |
Forfeited | $5.49 |
Outstanding at December 31, 2014 | $4.83 |
Stock_Options_Warrants_and_Res6
Stock Options Warrants and Restricted Stock (Details Textual) (USD $) | 12 Months Ended | 3 Months Ended | 0 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jan. 15, 2013 | Dec. 31, 2007 |
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Weighted-average grant-date fair value of options granted | $0 | $0 | $6.46 | |||
Intrinsic value of warrants exercised | $18 | $0 | $4,195 | |||
Unrecognized estimated compensation cost related to nonvested warrants granted | 0 | |||||
Total fair value of warrants vested | 33 | 0 | 311 | |||
Total unrecognized compensation cost related to nonvested restricted stock awards granted | 1,391 | |||||
Weighted-average period for recognition of compensation cost | 10 months 24 days | |||||
Warrants issued for investor relations consulting services [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Number of common stock called by warrants | 0 | 0 | 50 | |||
Exercise price of warrants | 0 | 0 | 9.02 | |||
Term of warrants | 5 years | |||||
Warrant related expenses | 0 | 0 | 311 | |||
Warrant [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Exercise price of warrants | ||||||
Selling, General and Administrative Expenses [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Equity-based compensation expense | 2,053 | 3,846 | 4,699 | |||
Net tax benefit recognized on equity-based compensation expense | 785 | 1,458 | 1,890 | |||
Amount of tax benefit realized from restricted stock | 378 | 1,042 | 1,169 | |||
Selling, General and Administrative Expenses [Member] | Warrant [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Compensation expense related to warrants | 0 | 0 | 311 | |||
Net tax benefit on equity-based compensation expense of warrants | 0 | 0 | 119 | |||
Amount of tax benefit realized from compensatory warrants exercised | 9 | 0 | 114 | |||
Stock options [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Weighted-average grant-date fair value of options granted | $0 | $0 | $0 | |||
Total intrinsic value of options exercised | 417 | 540 | 3,555 | |||
Unrecognized compensation cost related to nonvested stock options granted | 0 | |||||
Fair value of shares vested during period | 154 | 593 | 1,060 | |||
Net tax benefit recognized on equity-based compensation expense | 73 | 88 | 181 | |||
Tax benefit realized from stock options exercised | 73 | 88 | 599 | |||
Stock options [Member] | Mr. Robert G. Pedersen | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Number of unvested stock options | 32 | |||||
Consulting fees under separation agreement | 910 | |||||
Period for payment of consulting fees under separation agreement | 1 year | |||||
Stock options [Member] | Selling, General and Administrative Expenses [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Equity-based compensation expense | 28 | 280 | 1,008 | |||
Charge related to modification of previously granted stock option | 154 | |||||
Restricted Stock [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Equity-based compensation expense | 75 | 257 | 508 | |||
Restricted Stock [Member] | Separation and Release of Claims Agreement [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Charge related to modification of previously granted stock option | $345 | |||||
Number of unvested stock options | 127 | |||||
2007 Plan [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Issuance of common stock to directors, employees, consultants and advisors | 10,000 | |||||
Number of shares available for grant | 6,164 | |||||
2013 Plan [Member] | ||||||
Stock Options Warrants and Restricted Stock (Textual) | ||||||
Issuance of common stock to directors, employees, consultants and advisors | 5,000 | |||||
Number of shares available for grant | 4,091 | |||||
Term of the plan | 10 years |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (Fair value measurements recurring basis, Money market funds, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Estimate of Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | $374 | $163 |
Level 1 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | 374 | 163 |
Level 2 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | ||
Level 3 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents |
Fair_Value_Measurements_Detail1
Fair Value Measurements (Details 1) (Fair value measurements nonrecurring basis, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Estimate of Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Goodwill | $1,484 | |
Estimate of Fair Value | i Frogz Trademark [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | 7,038 | |
Estimate of Fair Value | EarPollution Trademark | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | 2,383 | |
Level 1 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Goodwill | ||
Level 1 Inputs | i Frogz Trademark [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | ||
Level 1 Inputs | EarPollution Trademark | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | ||
Level 2 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Goodwill | ||
Level 2 Inputs | i Frogz Trademark [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | ||
Level 2 Inputs | EarPollution Trademark | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | ||
Level 3 Inputs | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Goodwill | 1,484 | |
Level 3 Inputs | i Frogz Trademark [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | 7,038 | |
Level 3 Inputs | EarPollution Trademark | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Trademarks | $2,383 |
Fair_Value_Measurements_Detail2
Fair Value Measurements (Details Textual) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | |||
Number of common stock as underlying collateral for fair value measurement of notes receivables (in shares) | 80 | ||
Impairment loss | ($1,484) | ($5,441) | |
Ear Pollution Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Trademark impairment | -5,917 | ||
Impairment loss | 5,917 | ||
Ifrogz Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Trademark impairment | ($9,762) |
Note_Receivable_Details_Textua
Note Receivable (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 23, 2011 | Dec. 31, 2010 | Jun. 17, 2009 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Fixed rate | 1.25% | |||
ZAGG products | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Additional payments for ZAGGbox in aggregate amount | $2,747 | |||
Original principal amount | 4,126 | |||
Teleportall, LLC ('Teleportall') | Promissory note (the 'Note') | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Original principal amount | 4,126 | |||
Fixed rate | 4.00% | |||
Description of reference rate | LIBOR | |||
Percentage of the net profits of selling product | 50.00% | |||
Teleportall, LLC ('Teleportall') | ZAGG products | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Initial purchase order price for ZAGGbox units | 3,500 | |||
Additional payments for ZAGGbox in aggregate amount | 1,153 | |||
Non-recurring engineering (NRE) fee | 200 | |||
Payment of 30% of the total purchase price for the units ordered | $953 | |||
Payment in percentages of the total purchase price for the units ordered | 30.00% | |||
Indirect ownership interest | 25.00% | |||
Teleportall, LLC ('Teleportall') | ZAGG products | License Agreement | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Royalty on net sales of ZAGGboxes per calendar quarter as a license fee | 10.00% |
Note_Receivable_Details_Textua1
Note Receivable (Details Textual 1) (Teleportall, LLC ('Teleportall'), Commission Agreement, ZAGG products, USD $) | 1 Months Ended |
In Thousands, unless otherwise specified | Mar. 23, 2011 |
Teleportall, LLC ('Teleportall') | Commission Agreement | ZAGG products | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Initial term of agreement | 2 years |
Minimum purchase price during initial term of product | $25,000 |
Percentage of commission during first 60 days of introduction | 10.00% |
Introductory period of product | 60 days |
Term of agreement | 24 months |
Percentage of commission after 24 months | 2.00% |
Percentage of commission within 24 months after load in period | 3.00% |
Proportional percentage of commission | 50/50 |
Note_Receivable_Details_Textua2
Note Receivable (Details Textual 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jun. 30, 2011 | Mar. 23, 2011 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Granted stock option award | $1,560 | |
Number of shares authorized to be issued for repayment of note | 80 | |
ZAGG products | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Advance payments for ZAGGbox in aggregate amount | 3,900 | |
Original face value of Note for reimbursement of inventory advances and other costs | $4,126 |
Note_Receivable_Details_Textua3
Note Receivable (Details Textual 3) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2013 | 31-May-12 | Jan. 31, 2012 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Number of shares issued in the process of foreclosure | 45 | ||||
Value of shares issued in the process of foreclosure | $496 | ||||
Foreclosed on real estate property valued | 250 | ||||
Foreclosed on stock and warrants | 516 | ||||
Note receivable carrying amount | 1,149 | ||||
Note receivable offset to equity | 348 | ||||
Reclassification of note receivable | 0 | 218 | |||
Total unpaid principal balance, including accrued interest, late fees and costs | 4,735 | ||||
Teleportall, LLC ('Teleportall') | Minimum | Harmer agreement | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Estimated fair value of the underlying collateral security | 1,531 | ||||
Percentage of holdings | 50.00% | ||||
Teleportall, LLC ('Teleportall') | Maximum | Harmer agreement | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Estimated fair value of the underlying collateral security | $1,666 | ||||
Percentage of holdings | 100.00% |
Debt_and_Letters_of_Credit_Det
Debt and Letters of Credit (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable LIBOR Margin | 1.25% |
1.00 or greater | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable LIBOR Margin | 1.25% |
.65 or greater, but less than 1.00 | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable LIBOR Margin | 1.00% |
Less than 0.65 | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable LIBOR Margin | 0.75% |
Debt_and_Letters_of_Credit_Det1
Debt and Letters of Credit (Details 1) | 12 Months Ended |
Dec. 31, 2014 | |
1.00 or greater | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable Unused Commitment Fee (per annum) | 0.35% |
.65 or greater, but less than 1.00 | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable Unused Commitment Fee (per annum) | 0.25% |
Less than 0.65 | |
Total Liabilities To Tangible Net Worth [Line Items] | |
Applicable Unused Commitment Fee (per annum) | 0.15% |
Debt_and_Letters_of_Credit_Det2
Debt and Letters of Credit (Details Textual) (USD $) | 12 Months Ended | 1 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 20, 2013 |
Line Of Credit Facility [Line Items] | ||||
Basis spread on variable rate (in percent) | 1.25% | |||
Effective interest rate | 0.00% | 1.13% | ||
Payment of debt issuance costs | $43 | $238 | ||
Wells Fargo Bank | ||||
Line Of Credit Facility [Line Items] | ||||
Weighted average interest rate on all outstanding borrowings | 1.00% | |||
Amortization of deferred loan costs | 66 | 120 | ||
Wells Fargo Bank | Interest Expense | ||||
Line Of Credit Facility [Line Items] | ||||
Unused line fees | 75 | 73 | ||
Wells Fargo Bank | Other Noncurrent Assets | ||||
Line Of Credit Facility [Line Items] | ||||
Deferred loan costs | 60 | 126 | ||
Term Loan Facility | Wells Fargo Bank | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | 25,000 | |||
Maturity date | December 1, 2015 to December 1, 2016. | |||
Line of credit facility, outstanding balance | 0 | 17,543 | ||
Amendment fee | 10 | |||
Line of credit maturity date | 1-Dec-15 | |||
Standby commercial letters of credit | Wells Fargo Bank | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $5,000 |
Treasury_Stock_Details_Textual
Treasury Stock (Details Textual) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Treasury Stock [Abstract] | |||
Number of repurchase of shares authorized by board of directors | $10,000 | $10,000 | |
Number of common stock repurchased under plan | 1,813 | 1,756 | |
Cash consideration paid for repurchase of common stock | 9,579 | 9,997 | |
Weighted average price per share of stock repurchase | $5.25 | $5.66 | |
Commissions paid to brokers | $54 | $53 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies [Abstract] | |
2015 | $912 |
2016 | 767 |
2017 | 376 |
Total | $2,055 |
Commitments_and_Contingencies_2
Commitments and Contingencies (Details Textual) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Loss Contingencies [Line Items] | |||
Rental payment of leases | $1,640 | $1,564 | $1,615 |
Sublease Income | |||
Loss Contingencies [Line Items] | |||
Rental payment of leases | $910 | $996 | $751 |
Concentrations_Details
Concentrations (Details) (Sales revenue [Member]) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
United States [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 90.00% | 90.00% | 87.00% |
Europe [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 7.00% | 5.00% | 6.00% |
Other [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 3.00% | 5.00% | 7.00% |
Concentrations_Details_Textual
Concentrations (Details Textual) (Concentration of credit risk [Member], Accounts receivable [Member]) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Concentrations (Textual) | ||
Minimum account balance of accounts receivable in percentages for all other customers | No other customer account balances were more that 10% of accounts receivable. | No other customer account balances were more that 10% of accounts receivable. |
Largest customer [Member] | ||
Concentrations (Textual) | ||
Balance of accounts receivable due from two customers | 48.00% | 44.00% |
Separate customers [Member] | ||
Concentrations (Textual) | ||
Balance of accounts receivable due from two customers | 14.00% | 14.00% |
Concentrations_Details_Textual1
Concentrations (Details Textual 1) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Shannon Ireland [Member] | |||
Concentration Risk [Line Items] | |||
Net assets located overseas in Shannon Ireland | 8,050 | 8,695 | |
Sales revenue [Member] | Concentration of sales [Member] | |||
Concentration Risk [Line Items] | |||
Minimum Quarterly Revenues as a percentages | No other customer account balances were more that 10% of sales. | No other customer account balances were more that 10% of sales. | No other customer account balances were more that 10% of sales. |
Customer 1 [Member] | Sales revenue [Member] | Concentration of sales [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 30.00% | 26.00% | 32.00% |
Customer 2 [Member] | Sales revenue [Member] | Concentration of sales [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 11.00% | 18.00% | 11.00% |
Customer 3 [Member] | Sales revenue [Member] | Concentration of sales [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 11.00% | 6.00% | 7.00% |
Segment_Reporting_Details
Segment Reporting (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2014 |
Segment | ||
Segment Reporting Information [Line Items] | ||
Number of reportable segments | 3 | |
Corporate asset | $175,470 | $201,279 |
Hzo Investment [Member] | ||
Segment Reporting Information [Line Items] | ||
Corporate asset | $0 | $0 |
Quarterly_Financial_Data_Unaud2
Quarterly Financial Data (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||||
Net sales | $102,415 | $60,013 | $50,154 | $49,003 | $66,818 | $49,869 | $51,198 | $51,471 | $261,585 | $219,356 | $264,425 | ||||||||
Income (loss) from operations | 20,074 | -6,611 | 1,580 | 1,940 | -2,912 | 6,435 | 5,416 | 2,007 | 16,983 | 10,946 | 33,491 | ||||||||
Net income (loss) | $12,999 | ($4,319) | $793 | $988 | ($2,044) | $3,184 | $2,774 | $876 | $10,461 | $4,790 | $14,505 | ||||||||
Earnings per share attributable to stockholders: (1) | |||||||||||||||||||
Basic | $0.44 | [1] | ($0.14) | [1] | $0.03 | [1] | $0.03 | [1] | ($0.07) | [1] | $0.10 | [1] | $0.09 | [1] | $0.03 | [1] | $0.35 | $0.16 | $0.48 |
Dilutive | $0.43 | [1] | ($0.14) | [1] | $0.03 | [1] | $0.03 | [1] | ($0.07) | [1] | $0.10 | [1] | $0.09 | [1] | $0.03 | [1] | $0.34 | $0.15 | $0.46 |
Weighted average common shares: | |||||||||||||||||||
Basic | 29,854 | 30,312 | 30,281 | 30,549 | 30,883 | 30,926 | 30,739 | 31,052 | 30,247 | 30,900 | 30,339 | ||||||||
Diluted | 30,288 | 30,312 | 30,575 | 30,864 | 30,883 | 31,466 | 31,218 | 31,726 | 30,610 | 31,459 | 31,656 | ||||||||
[1] | The earnings per share calculations for each of the quarters were based upon the weighted average number of shares outstanding during each period, and the sum of the quarters may not be equal to the full year earnings per common share amounts. |
Defined_Contribution_Plan_Deta
Defined Contribution Plan (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Defined Contribution Plan (Textual) | |
Percentage of employees salary matches participant contributions | 100.00% |
Percentage of maximum employees salary | 3.00% |
Percentage of contributions | 50.00% |