Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 01, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | ZAGG Inc | ||
Entity Central Index Key | 1,296,205 | ||
Trading Symbol | zagg | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,016 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 125,272,928 | ||
Entity Common Stock, Shares Outstanding | 28,311,248 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 11,604 | $ 13,002 |
Accounts receivable, net of allowances of $824 in 2016 and $568 in 2015 | 83,835 | 57,647 |
Inventories | 72,769 | 45,912 |
Prepaid expenses and other current assets | 3,414 | 3,142 |
Income tax receivable | 2,814 | 1,158 |
Deferred income tax assets | 23,050 | 10,840 |
Total current assets | 197,486 | 131,701 |
Property and equipment, net of accumulated depreciation of $18,371 in 2016 and $10,539 in 2015 | 17,755 | 8,309 |
Goodwill | 12,272 | |
Intangible assets, net of accumulated amortization of $55,298 in 2016 and $41,803 in 2015 | 53,362 | 23,045 |
Deferred income tax assets | 27,313 | 15,386 |
Other assets | 2,541 | 1,100 |
Total assets | 310,729 | 179,541 |
Current liabilities | ||
Accounts payable | 85,022 | 33,846 |
Accrued liabilities | 22,216 | 5,068 |
Sales returns liability | 28,373 | 7,849 |
Accrued wages and wage related expenses | 6,169 | 2,244 |
Deferred revenue | 273 | 17 |
Line of credit | 31,307 | |
Current portion of long-term debt, net of deferred loan costs of $65 in 2016 | 10,484 | |
Total current liabilities | 183,844 | 49,024 |
Noncurrent portion of long-term debt, net of deferred loan costs of $141 in 2016 | 9,623 | |
Total liabilities | 193,467 | 49,024 |
Stockholders' equity | ||
Common stock, $0.001 par value; 100,000 shares authorized; 33,840 and 33,219 shares issued in 2016 and 2015, respectively | 34 | 33 |
Additional paid-in capital | 92,782 | 88,983 |
Accumulated other comprehensive loss | (2,114) | (1,597) |
Treasury stock, 5,831 and 5,679 common shares in 2016 and 2015 respectively, at cost | (36,145) | (35,194) |
Retained earnings | 62,705 | 78,292 |
Total stockholders' equity | 117,262 | 130,517 |
Total liabilities and stockholders' equity | $ 310,729 | $ 179,541 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Balance Sheets [Abstract] | ||
Allowances for doubtful accounts | $ 824 | $ 568 |
Accumulated depreciation on property and equipment | 18,371 | 10,539 |
Accumulated amortization on intangible assets | 55,298 | $ 41,803 |
Deferred loan costs, current | 65 | |
Deferred loan costs, non current | $ 141 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 33,840 | 33,219 |
Treasury stock | 5,831 | 5,679 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Operations [Abstract] | |||
Net sales | $ 401,857 | $ 269,311 | $ 261,585 |
Cost of sales | 274,255 | 167,627 | 178,241 |
Gross profit | 127,602 | 101,684 | 83,344 |
Operating expenses: | |||
Advertising and marketing | 12,440 | 10,436 | 7,542 |
Selling, general and administrative | 96,229 | 56,752 | 49,110 |
Loss on disputed mophie purchase price | 24,317 | ||
Transaction costs | 2,591 | 179 | |
Amortization of definite-lived intangibles | 13,385 | 8,453 | 9,709 |
Total operating expenses | 148,962 | 75,820 | 66,361 |
Income (loss) from operations | (21,360) | 25,864 | 16,983 |
Other income (expense): | |||
Interest expense | (1,851) | (97) | (170) |
Other income (expense) | (348) | (69) | 121 |
Total other expense, net | (2,199) | (166) | (49) |
Income (loss) before provision for income taxes | (23,559) | 25,698 | 16,934 |
Income tax benefit (provision) | 7,972 | (10,111) | (6,473) |
Net income (loss) | $ (15,587) | $ 15,587 | $ 10,461 |
Earnings (loss) per share attributable to stockholders: | |||
Basic earnings (loss) per share | $ (0.56) | $ 0.54 | $ 0.35 |
Diluted earnings (loss) per share | $ (0.56) | $ 0.54 | $ 0.34 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (15,587) | $ 15,587 | $ 10,461 |
Other comprehenseive loss, net of tax: | |||
Foreign currency translation loss | (517) | (702) | (988) |
Total other comprehensive income (loss) | (517) | (702) | (988) |
Comprehensive income (loss) | $ (16,104) | $ 14,885 | $ 9,473 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Note Receivable Collateralized By Stock | Treasury Stock | Retained Earnings |
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 income loss | 10,461 | 10,461 | |||||
Other comprehensive loss | (988) | (988) | |||||
Purchase of shares of treasury stock | (9,579) | (9,579) | |||||
Option exercises | 265 | 265 | |||||
Option exercises (in shares) | 148 | ||||||
Warrant exercises | |||||||
Warrant exercises (in shares) | 3 | ||||||
Restricted stock release | 1 | $ 1 | |||||
Restricted stock release (in shares) | 204 | ||||||
Stock-based compensation expense | 2,248 | 2,248 | |||||
Payment of withholding of restricted stock units | (75) | (75) | |||||
Excess tax benefit (shortfall) related to share-based payments | (91) | (91) | |||||
Balances at Dec. 31, 2014 | 127,073 | $ 33 | 85,154 | (895) | (348) | (19,576) | 62,705 |
Balances, Shares at Dec. 31, 2014 | 32,686 | ||||||
Net income loss | 15,587 | 15,587 | |||||
Other comprehensive loss | (702) | (702) | |||||
Purchase of shares of treasury stock | (14,930) | (14,930) | |||||
Foreclosure of 80 shares of stock collateralizing note receivable | (340) | 348 | (688) | ||||
Option exercises | 168 | 168 | |||||
Option exercises (in shares) | 118 | ||||||
Warrant exercises | 38 | 38 | |||||
Warrant exercises (in shares) | 45 | ||||||
Restricted stock release | |||||||
Restricted stock release (in shares) | 349 | ||||||
Consideration for acquisition of patent | 198 | 198 | |||||
Consideration for acquisition of patent (in shares) | 21 | ||||||
Stock-based compensation expense | 3,893 | 3,893 | |||||
Payment of withholding of restricted stock units | (724) | (724) | |||||
Excess tax benefit (shortfall) related to share-based payments | 256 | 256 | |||||
Balances at Dec. 31, 2015 | 130,517 | $ 33 | 88,983 | (1,597) | (35,194) | 78,292 | |
Balances, Shares at Dec. 31, 2015 | 33,219 | ||||||
Net income loss | (15,587) | (15,587) | |||||
Other comprehensive loss | (517) | (517) | |||||
Purchase of shares of treasury stock | (951) | (951) | |||||
Option exercises | |||||||
Option exercises (in shares) | 21 | ||||||
Warrant exercises | 54 | 54 | |||||
Warrant exercises (in shares) | 7 | ||||||
Restricted stock release | 1 | $ 1 | |||||
Restricted stock release (in shares) | 589 | ||||||
Employee stock purchase plan release | |||||||
Employee stock purchase plan release, shares | 4 | ||||||
Stock-based compensation expense | 3,830 | 3,830 | |||||
Payment of withholding of restricted stock units | (630) | (630) | |||||
Excess tax benefit (shortfall) related to share-based payments | 545 | 545 | |||||
Balances at Dec. 31, 2016 | $ 117,262 | $ 34 | $ 92,782 | $ (2,114) | $ (36,145) | $ 62,705 | |
Balances, Shares at Dec. 31, 2016 | 33,840 |
Consolidated Statements of Equ7
Consolidated Statements of Equity (Parenthetical) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Stockholders' Equity [Abstract] | |||
Treasury stock purchased (in shares) | 152 | 2,030 | 1,813 |
Foreclosure shares of stock collateralizing note receivable (shares) | 80 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities | |||
Net income (loss) | $ (15,587) | $ 15,587 | $ 10,461 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Stock-based compensation | 3,830 | 3,893 | 2,248 |
Excess tax benefit related to share-based payments | (641) | 256 | (22) |
Depreciation and amortization | 22,271 | 12,933 | 12,899 |
Reduction in reserve on note receivable upon foreclosure recovery | (639) | ||
Deferred income taxes | (7,972) | (1,162) | (5,770) |
Amortization of deferred loan costs | 202 | 60 | 66 |
Loss on disputed mophie purchase price | 24,317 | ||
Changes in operating assets and liabilities (net of amounts acquired) | |||
Accounts receivable, net | (11,587) | 18,383 | (29,490) |
Inventories | (2,198) | 2,064 | (4,350) |
Prepaid expenses and other current assets | 422 | (651) | (421) |
Other assets | (330) | 551 | 160 |
Accounts payable | 14,094 | (14,635) | 33,373 |
Income taxes receivable (payable) | 9,994 | (7,366) | 13 |
Accrued liabilities | 2,836 | (3,410) | 4,616 |
Accrued wages and wage related expenses | 1,819 | (356) | 1,709 |
Deferred revenue | 246 | (162) | 21 |
Sales returns liability | (9,037) | (814) | 813 |
Net cash provided by operating activities | 32,679 | 24,532 | 26,326 |
Cash flows from investing activities | |||
Purchase of property and equipment (net of amounts acquired) | (8,633) | (4,910) | (4,430) |
Purchase of mophie, net of cash acquired | (74,743) | ||
Net cash used in investing activities | (83,376) | (4,910) | (4,430) |
Cash flows from financing activities | |||
Payment of debt issuance costs | (1,144) | ||
Proceeds from revolving credit facility | 336,391 | 9,871 | 56,075 |
Payments on revolving credit facility | (305,084) | (9,871) | (73,618) |
Proceeds from term loan facility | 25,000 | ||
Payments on term loan facility | (4,688) | ||
Purchase of treasury stock | (951) | (14,930) | (9,579) |
Payment of withholdings tax on restricted stock units | (630) | (724) | (75) |
Proceeds from exercise of warrants and options | 54 | 207 | 265 |
Excess tax benefits related to share-based payments | 641 | (256) | 22 |
Net cash provided by (used in) financing activities | 49,589 | (15,703) | (26,910) |
Effect of foreign currency exchange rates on cash and cash equivalents | (290) | (378) | (556) |
Net increase (decrease) in cash and cash equivalents | (1,398) | 3,541 | (5,570) |
Cash and cash equivalents at beginning of the period | 13,002 | 9,461 | 15,031 |
Cash and cash equivalents at end of the period | 11,604 | 13,002 | 9,461 |
Supplemental disclosure of cash flow information | |||
Cash paid during the period for interest | 1,497 | 46 | 97 |
Cash paid (refunded) during the period for taxes, net | (9,521) | 18,710 | 12,370 |
Supplemental schedule of noncash investing and financing activities | |||
Purchase of mophie financed through contingent payments | 12,139 | ||
Purchase of fixed assets financed through accounts payable | 758 | 269 | 975 |
Purchase of fixed assets financed through tenant improvement allowance | 1,218 | ||
Foreclosure on real property | 1,099 | ||
Foreclosure on common stock | $ 688 | ||
Issued shares of common stock with a fair value | 21 | ||
Purchase of patent or intangible assets | $ 198 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
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 ZAGG Inc and its subsidiaries (“we,” “us,” “our,” “ZAGG,” or the “Company”) are innovation leaders in mobile tech accessories for smartphones and tablets. For over 10 years, ZAGG has developed creative product solutions that enhance and protect mobile devices for consumers around the world. The Company has an award-winning product portfolio that includes screen protection, power cases, power management, personal audio, mobile keyboards, cases, and social tech sold under the ZAGG, InvisibleShield, mophie, and IFROGZ brands. In June 2011, ZAGG acquired 100% of the outstanding shares of IFROGZ, which further diversified the existing ZAGG product lines, particularly for personal audio and protective case accessories. On March 3, 2016, the Company acquired mophie inc. ("mophie") for gross up-front cash consideration of $100,000, subject to a preliminary working capital adjustment of $23,478. During procedures to determine the final working capital adjustment, significant claims for breaches of representations, warranties and covenants that directly impacted current assets and current liabilities were also identified. When considering the (1) preliminary working capital adjustment, (2) final working capital adjustment, and (3) claims for breaches of representations and warranties that directly impacted current assets and current liabilities, the Company concluded that these adjustments totaled $49,795. The results of operations of mophie are included in the Company's results of operations beginning on March 3, 2016. Based on the manner in which the Company manages, evaluates, and internally reports its operations, the Company determined that mophie will be reported as a separate reportable segment. See Notes 4 and 15 for additional details on the acquisition and the Company's reportable segments. 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 inventory write-downs, sales returns and warranty liability, 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. (“ZAGG IP”); ZAGG Retail, Inc; mophie inc.; mophie LLC; mophie Technology Development Co., Ltd; mophie Netherlands Coöperatie U.A.; and mophie Limited. All intercompany transactions and balances have been eliminated in consolidation. The Company holds an investment in HzO, Inc. (“HzO”), a private company engaged in the development of water-blocking technologies for consumer and industrial applications. The investment is less than 20% and thus is accounted for under the cost method. Due to accumulated losses, the carrying amount of the investment in HzO was $0 at December 31, 2016 and 2015. In connection with the acquisition of mophie, the Company changed its operating segments, as described in Note 15. 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, 2016 and 2015 totaled $264 and $61, respectively. Cash equivalents as of December 31, 2016 and 2015, 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, 2016, 2015 and 2014: For the Years Ended December 31, 2016 2015 2014 Balance at beginning of year $ 568 $ 1,910 $ 2,540 Additions charged to expense 599 243 389 Assumed in acquisition of mophie 91 - - Write-offs charged against the allowance (430 ) (1,585 ) (1,019 ) Foreign currency translation loss (4 ) - - Balance at end of year $ 824 $ 568 $ 1,910 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. Goodwill At least annually and when events and circumstances warrant an evaluation, we perform our impairment assessment of goodwill. This assessment initially permits an entity to make a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the two-step goodwill impairment test. If an entity can support the conclusion that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it would not need to perform the two-step impairment test for the reporting unit. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the two-step analysis is performed, which incorporates a fair-value based approach. We determine the fair value of our reporting units based on discounted cash flows and market approach analyses as considered necessary. We consider factors such as the economy, reduced expectations for future cash flows coupled with a decline in the market price of our stock and market capitalization for a sustained period as indicators for potential goodwill impairment. If the reporting unit’s carrying amount exceeds its estimated fair value, a second step must be performed to measure the amount of the goodwill impairment loss, if any. The second step compares the implied fair value of the reporting unit’s goodwill, determined in the same manner as the amount of goodwill recognized in a business combination, with the carrying amount of such goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess Intangibles assets Intangible assets include internet addresses, intellectual property, and acquired intangibles in connection with the acquisitions of IFROGZ and mophie, which include patents, technology, customer relationships, trademarks, tradenames, non-compete agreements, and other miscellaneous intangible assets. Long-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 amortizing 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 or risk of loss has transferred to the customer, 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.mophie.com 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 impact is recorded as a reduction of revenues and cost of sales, and as a reduction in the 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, warranty, and other credits liability for the years ended December 31, 2016, 2015 and 2014: 2016 2015 2014 Balance at beginning of year $ 7,849 $ 8,674 $ 7,872 Additions charged to sales 92,868 43,320 35,923 Assumed in acquisition of mophie 29,584 - - Sales returns & warranty claims charged against reserve (101,928 ) (44,145 ) (35,121 ) $ 28,373 $ 7,849 $ 8,674 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. The Company recognizes compensation expense on a straight-line basis for those performance-based awards that management estimates the performance criteria are probable to be achieved. 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, 2016, 2015 and 2014 were $12,440, $10,436 and $7,542, 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 in Ireland and the Netherlands, while the Renminbi is the functional currency of the Company’s subsidiary in China. 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 ($144), $52 and $149 for the years ended December 31, 2016, 2015 and 2014, 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, 2016, 2015 and 2014: 2016 2015 2014 Net (loss) income $ (15,587 ) $ 15,587 $ 10,461 Weighted average shares outstanding: Basic 28,006 28,773 30,247 Dilutive effect of stock options, restricted stock, and warrants - 316 363 Diluted 28,006 29,089 30,610 Earnings (loss) per share: Basic $ (0.56 ) $ 0.54 $ 0.35 Dilutive $ (0.56 ) $ 0.54 $ 0.34 For the year ended December 31, 2016, 765 restricted stock units and warrants to purchase 50 shares of common stock were not considered in calculating diluted earnings per share as their effect would have been anti-dilutive. For the years ended December 31, 2015, and 2014, restricted stock units, warrants and stock options to purchase 250, and 485 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 units, or stock options was greater than the average market price of common shares during the period and, therefore, the effect would be anti-dilutive. Business combinations We allocate the purchase price of acquired companies to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over these fair values is recorded as goodwill. We engaged an independent third-party valuation firm to assist us in determining the fair values of certain assets acquired and liabilities assumed. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. The significant purchased classes of intangible assets recorded by us include tradenames, technology, customer relationships, non-compete agreements, and backlog. The fair values assigned to the identified intangible assets are discussed in Note 4 to the consolidated financial statements. Significant estimates in valuing certain intangible assets include but are not limited to: future expected cash flows related to each individual asset, market position of the tradenames and assumptions about cash flow savings from the tradenames, determination of useful lives, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and thus, actual results may differ from estimates. Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an 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 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 may be adopted utilizing one of two methods. The first method is to adopt the ASU by recording the effect of the guidance in the ASU retrospectively to each prior period presented in the period of adoption. The second method is to adopt the ASU by recording the effect of the guidance in the ASU retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application. On July 9, 2015, the FASB voted to approve a one-year deferral of the effective date of this ASU. This deferral was issued by the FASB in ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date”. As a result of ASU No. 2015-14, the Company expects that it will apply the new revenue standard to annual and interim reporting periods beginning after December 15, 2017. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606) – Narrow-Scope Improvements and Practical Expedients”. The amendments and practical expedients presented in the ASU aim to simplify the transition to the new standard, to provide practical expedients for transition and sales taxes, and to clarify certain aspects of the standard. The Company currently anticipates adopting the standard retrospectively with the cumulative effect of adoption recorded at the date of initial application. The Company is currently evaluating the impact the ASU will have on its consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” This ASU provides guidance to entities that measure inventory using a method other than last-in, first-out (LIFO) or the retail inventory method. For entities using first-in, first-out (FIFO) or average cost, the measurement principle for their inventory changes from the lower of cost or market to lower of cost or net realizable value. Current U.S. GAAP requires, at each financial statement date, that entities measure inventory at the lower of cost or market. The measurement of market is commonly the current replacement cost. However, entities also need to consider net realizable value and net realizable value less an approximately normal profit margin in their measurement. For entities using a method other than LIFO or the retail inventory method, the ASU replaces market with net realizable value. This ASU requires prospective adoption for inventory measurement for annual and interim periods beginning after December 15, 2016 for public business entities. The Company expects that this ASU will not have a significant impact on our financial position or results of operations. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as noncurrent. The amendments in the ASU may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2016. The Company has determined that it will adopt the ASU using the retrospective approach and expects that the adoption of this ASU will result in recording deferred tax assets as non-current and will not impact our results of operations. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 542)”, which requires lessees to recognize most leases, including operating leases, on-balance sheet via a right of use asset and lease liability. Lessees are allowed to account for short-term leases (i.e., leases with a term of 12 months or less) off-balance sheet, consistent with current operating lease accounting. A number of other significant changes to lease accounting have been effected through the issuance of this standard. The requirements of the new standard for leases shall be recognized and measured at the beginning of the earliest comparative period presented. When adopted, the Company will be required to adjust equity at the beginning of the earliest comparative period presented, and the other comparative amounts disclosed for each prior period presented in the financial statements, as if the requirements of the new standard had always been applied. The new standard also contains practical expedients which the Company may elect to follow. The new standard is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including whether to elect the practical expedients outlined in the new standard. In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting,” which simplified accounting for share-based payments. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those years for public business entities. Early adoption is permitted in any interim or annual period provided that the entire ASU is adopted. Amendments in the ASU related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares should be applied retrospectively. Amendments requiring the recognition of excess tax benefits and tax deficiencies in the income statement should be applied prospectively. The amendments related to the presentation of excess tax benefits on the statement of cash flows may be applied using either a prospective or retrospective transition method. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including, where applicable, determining the method of adoption. In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments,” which addresses eight classification issues related to the statement of cash flows: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. The ASU is effective for public companies for fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The amendments in the ASU should be applied using a retrospective transition method to each period presented. If it is impracticable for the amendments to be applied retrospectively for some of the issues, the amendments for those issues may be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including the method of adoption. In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory,” which requires entities to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires companies to include cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventories [Abstract] | |
INVENTORIES | (2) INVENTORIES Inventory consisted of the following components: December 31, 2016 2015 Finished goods $ 72,490 $ 44,764 Raw materials 279 1,148 Total inventories $ 72,769 $ 45,912 Included in prepaid expenses and other current assets were inventory deposits with third-party manufacturers at December 31, 2016 and 2015 of $437 and $813, respectively. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | (3) PROPERTY AND EQUIPMENT Property and equipment, net consisted of the following: December 31, 2016 2015 Useful Lives Computer equipment and software 2 to 5 years $ 3,634 $ 2,912 Equipment and molds 2 to 10 years 16,609 9,536 Furniture and fixtures 1 to 7 years 3,409 745 Automobiles 5 years 230 199 Building and Improvements 40 years 2,270 - Land 325 - Leasehold improvements 1 to 5 years 9,649 5,456 36,126 18,848 Less accumulated depreciation and amortization (18,371 ) (10,539 ) Net property and equipment $ 17,755 $ 8,309 |
Acquisition of Mophie Inc.
Acquisition of Mophie Inc. | 12 Months Ended |
Dec. 31, 2016 | |
Acquisition of Mophie Inc. [Abstract] | |
ACQUISITION OF MOPHIE INC. | (4) ACQUISITION OF MOPHIE INC. On February 2, 2016, ZAGG and ZM Acquisition, Inc. (“Merger Sub”), a Delaware corporation and wholly-owned subsidiary of the Company, entered into an Agreement and Plan of Merger (the “Merger Agreement”) with mophie, a California corporation, the principal shareholders of mophie named therein (the “Principal Shareholders”), and Daniel Huang as representative of the mophie shareholders, warrant holders, and option holders, pursuant to which Merger Sub agreed to merge with and into mophie, with mophie continuing as the surviving corporation (the “Merger”). On March 3, 2016 (the “Acquisition Date”), the Company completed the Merger. The combination of ZAGG and mophie creates a diversified market leader in multiple mobile accessories categories. The Company purchased mophie for total gross up-front consideration of $100,000 in cash, subject to an adjustment based on the estimated and actual net working capital of mophie as of the Acquisition Date. The Merger Agreement includes an earn-out provision whereby additional consideration could be paid based on whether mophie’s 12-month Adjusted EBITDA (as defined in the Merger Agreement) from April 1, 2016 to March 31, 2017 (the “Earnout Period”) exceeds $20,000, subject to certain tax adjustments as provided in the Merger Agreement. For every dollar in Adjusted EBITDA generated during the Earnout Period that exceeds $20,000, the Company will pay additional consideration at a five times multiple (“Earnout Consideration”), subject to certain tax adjustments as provided in the Merger Agreement, and the deposit of 10% of the Earnout Consideration into an indemnity escrow account. Any Earnout Consideration will initially be paid by the issuance of up to $5,000 in shares of the Company’s common stock valued as of February 2, 2016 (the day prior to the public announcement of the definitive agreement on February 3, 2016). Based on mophie’s Adjusted EBITDA (as defined in the Merger Agreement) from April 1, 2016 to December 31, 2016, the Company presently expects that the mophie shareholders will not be entitled to any Earnout Consideration. In addition to the Earnout Consideration, the Merger Agreement identifies three other contingent payments (the “Contingent Payments”) to be remitted to the Principal Shareholders upon receipt of such funds by ZAGG after the Acquisition Date, subject to any applicable offset rights of ZAGG under the Merger Agreement: ● Federal and state tax refunds due to the Company related to 2012 and 2013 tax years; ● Customs and duties refunds for pre-closing overpayments of customs and duties amounts to governmental agencies; and ● Proceeds from the sale of real property located in Kalamazoo, Michigan. $2,000 of the cash consideration paid to the Principal Shareholders was placed in an escrow account to cover any net working capital shortfall and indemnification claims of ZAGG. ZAGG and the Principal Shareholders also jointly purchased a $10,000 insurance policy with a $2,000 deductible that insures against breaches by mophie and the Principal Shareholders of representations and warranties set forth in the Merger Agreement. At the Acquisition Date, mophie’s estimated closing balance sheet reflected negative working capital of $23,478. Upon completion of the procedures to evaluate the working capital account, ZAGG has determined that the closing balance sheet reflected actual closing negative working capital and losses from breaches of representations, warranties and covenants that directly impacted current assets and current liabilities in the aggregate amount of $49,795, resulting in an additional actual closing working capital deficit and loss claims in the amount of $26,317. ZAGG has submitted to the Principal Shareholders a closing adjustment statement seeking the release to ZAGG of the $2,000 placed in escrow based on the portion of the overall net working capital deficit that ZAGG has determined to be recoverable under Section 2.16 of the Merger Agreement. Mr. Huang, as the Representative of the Shareholders, submitted a dispute notice in which he, on behalf of all Shareholders, disputed ZAGG’s closing adjustment statement, asserted that there is no additional working capital deficit, and demanded release of the $2,000 escrow fund to the Principal Shareholders. The Company is continuing to pursue its claims related to the net working capital deficit, which efforts have required the Company to resort to the independent accountant dispute resolution mechanism provided in the Merger Agreement in order to obtain the $2,000 placed in escrow. ZAGG engaged in discussions with the Principal Shareholders and Mr. Huang to seek recovery against the Contingent Payments and otherwise to be made whole with respect to such balance of the working capital deficit and losses from breaches of representations, warranties and covenants. However, as of December 31, 2016, there had been no resolution of either of such amounts and a total of $26,317 was in dispute between the parties. Thus, the Company has recorded a net charge of $24,317 on the mophie purchase price during the year ended December 31, 2016, representing the disputed $26,317 partially offset by the $2,000 cash consideration placed in escrow, the recovery of which the Company believes to be likely. The Company has commenced procedures to recover the amounts related to the aggregate net working capital deficit and losses from breaches of representations, warranties and covenants including (1) pursuing collection of the $2,000 escrow amount, (2) submitting claims under the $10,000 representation and warranty insurance policy put in place at the Acquisition Date, (3) pursuing any and all offset rights granted under the Merger Agreement with respect to the Contingent Payments that would have been paid to the Principal Shareholders and (4) pursuing litigation against Mr. Huang, the other mophie shareholders and others in Delaware and California for breaches of certain representations, warranties and covenants of mophie in the Merger Agreement that have resulted in damages exceeding $22,000. On October 21, 2016, Mr. Huang, on behalf of the mophie Shareholders and himself filed a lawsuit in the Chancery Court of the State of Delaware alleging that the Company has breached the Merger Agreement by failing to pay certain of the Contingent Payments related to tax refunds and customs duties and claims damages in the amount of no less than $11,420 (see Note 13 for further discussion regarding the status of this litigation, including the Company’s counterclaims). The following summarizes the components of the purchase consideration as of March 3, 2016: Adjustments to Preliminary Allocation Working Capital and Final Allocation March 3, Fair March 3, Cash consideration $ 100,000 $ - $ 100,000 Negative working capital at Acquisition Date (23,478 ) - (23,478 ) Additional negative working capital deficit - (26,317 ) (26,317 ) Contingent payments 11,283 856 12,139 Total purchase price $ 87,805 $ (25,461 ) $ 62,344 The total purchase price of $62,344 has been allocated to identifiable assets acquired and liabilities assumed based on their respective fair values. The total purchase price was adjusted during the third quarter of 2016 because of (1) additional information related to the working capital reflected in the closing balance sheet and estimate of fair value of the assets acquired and liabilities assumed and (2) the determination that the fair value of the Earnout Consideration is insignificant. The excess of the purchase price over the fair value of tangible and intangible assets acquired and liabilities assumed is recorded as goodwill. All goodwill associated with the acquisition has been allocated to the mophie reporting unit. The following table summarizes the final fair values of the identifiable assets acquired and liabilities assumed as of the Acquisition Date: Cash and cash equivalents $ 1,779 Trade receivables (gross contractual receivables of $12,914) 12,823 Inventories 24,911 Prepaid expenses and other assets 1,073 Income tax receivable 11,814 Deferred tax assets 16,168 Property and equipment 10,191 Land held for sale 325 Amortizable identifiable intangible assets 43,812 Goodwill 12,272 Accounts payable (37,359 ) Income tax payable (196 ) Accrued liabilities (5,163 ) Deferred revenue (9 ) Sales returns liability (29,584 ) Other noncurrent liabilities (513 ) Total $ 62,344 The following table summarizes the purchase price allocation as of March 3, 2016: Preliminary Purchase Adjustments to Final Purchase Price Allocation Working Capital and Price Allocation March 3, Fair March 3, Cash and cash equivalents $ 1,779 $ - $ 1,779 Trade receivables 13,483 (660 ) 12,823 Inventories 32,335 (10,010 ) 22,325 Inventory step-up 6,937 (4,351 ) 2,586 Prepaid expenses 485 215 700 Other assets 200 173 373 Income tax receivable 10,958 856 11,814 Deferred tax assets 24,925 (8,757 ) 16,168 Property and equipment 10,191 - 10,191 Land held for sale 325 - 325 Amortizable identifiable intangible assets 45,463 (1,651 ) 43,812 Goodwill 14,092 (1,820 ) 12,272 Accounts payable (34,228 ) (3,131 ) (37,359 ) Income tax payable (196 ) - (196 ) Accrued liabilities (5,185 ) 22 (5,163 ) Deferred revenue (800 ) 791 (9 ) Sales returns liability (14,468 ) (15,116 ) (29,584 ) Deferred tax liabilities (17,978 ) 17,978 - Other noncurrent liabilities (513 ) - (513 ) Total $ 87,805 $ (25,461 ) $ 62,344 The adjustments to working capital represented in the table above consist of (1) the additional actual closing working capital deficit of $26,317 and (2) adjustments to fair value of $856. As part of the acquisition of mophie, the Company incurred legal, accounting, investment banking and other due diligence fees that were expensed when incurred. Total fees incurred related to the acquisition of mophie for the year ended December 31, 2016 were $2,591 which are included as a component of operating expenses on the consolidated statement of operations. Identifiable Intangible Assets Classes of acquired intangible assets include tradenames, patents and technology, customer relationships, non-compete agreements, and backlog. The fair value of the identifiable intangible assets was determined using various valuation methods, including the income and market approaches. For assets valued under the income approach, the estimate of the present value of expected future cash flows for each identifiable asset 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 data adjusted based on the Company’s historical experience and the expectations of market participants. The market approach was utilized to determine appropriate royalty rates applied to the valuation of the trademarks and technology. The preliminary amounts assigned to each class of intangible asset and the related preliminary weighted average amortization periods are as follows: Intangible asset class Weighted-average amortization period Tradenames $ 18,348 10.0 years Patents and technology 15,225 7.5 years Customer relationships 8,200 5.0 years Non-compete agreements 1,796 5.0 years Backlog 243 0.3 years Total $ 43,812 Goodwill Goodwill represents the excess of the mophie purchase price over the fair value of the assets acquired and liabilities assumed. $160 of the acquired goodwill is deductible for tax purposes. The Company believes that the primary factors supporting the amount of goodwill recognized are the significant growth opportunities and expected synergies of the combined entity. Results of Operations The results of operations of mophie are included in the Company’s results of operations beginning on March 3, 2016. For the year ended December 31, 2016, mophie generated net sales of $113,749 and had a net loss before tax of $31,145. Pro forma Results from Operations The following unaudited pro-forma results of operations for the 12 months ended December 31, 2016 and 2015 give pro forma effect as if the acquisition and borrowings used to finance the acquisition had occurred on January 1, 2015, after giving effect to certain adjustments including the amortization of intangible assets, interest expense, tax adjustments, specific transaction related expenses incurred prior to the execution date, and assumes the purchase price was allocated to the assets purchased and liabilities assumed based on their fair market values at the date of purchase. 12 Months Ended December 31, 2016 December 31, 2015 Net sales $ 419,183 $ 455,165 Net loss $ (17,487 ) $ (5,393 ) Basic loss per share $ (0.62 ) $ (0.19 ) Diluted loss per share $ (0.62 ) $ (0.19 ) The unaudited pro forma information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have occurred had the transaction been consummated as of January 1, 2015. Furthermore, such unaudited pro forma information is not necessarily indicative of future operating results of the combined companies, due to changes in operating activities following the purchase, and should not be construed as representative of the operating results of the combined companies for any future dates or periods. For the 12 months ended December 31, 2016 and 2015, pro forma net loss includes pro forma amortization expense of $6,770 and $7,432, respectively. In addition, the Company included interest from the new credit facility and amortization of debt issuance costs for the 12 months ended December 31, 2016 and 2015 of $1,753 and $1,924, respectively. Material non-recurring adjustments excluded from the pro forma financial information for the 12 months ended December 31, 2015 consists of the $2,586 step up of mophie inventory to its fair value, which has been recorded as an unfavorable adjustment to cost of goods sold during the six months following the acquisition date. The unaudited pro forma results do not reflect events that either have occurred or may occur after the Merger, including, but not limited to, the anticipated realization of ongoing savings from operating synergies in subsequent periods. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | (5) GOODWILL AND INTANGIBLE ASSETS Goodwill There was an increase in goodwill during the year ended December 31, 2016 from $0 to $12,272 due to the Company’s acquisition of mophie on March 3, 2016. The following table summarizes the changes in goodwill: Balance at December 31, 2015 $ — Increase due to acquisitions 12,272 Balance at December 31, 2016 $ 12,272 The Company noted no impairment of goodwill for the year-ended December 31, 2016. Long-lived Intangibles As of December 31, 2016 Gross Carrying Amount Acquisitions Accumulated Amortization Net Carrying Amount Weighted Average Amortization Period Customer relationships $ 41,500 $ 8,200 $ (35,088 ) $ 14,612 7.5 years Tradenames 12,921 18,348 (9,763 ) 21,506 9.8 years Patents and technology 6,003 15,225 (5,501 ) 15,727 8.8 years Non-compete agreements 4,100 1,796 (4,399 ) 1,497 4.9 years Other 324 243 (547 ) 20 2.4 years Total amortizable assets $ 64,848 $ 43,812 $ (55,298 ) $ 53,362 8.2 years As of December 31, 2015 Gross Carrying Amount Acquisitions Accumulated Amortization Net Carrying Amount Weighted Average Amortization Period Customer relationships $ 41,500 $ — $ (29,150 ) $ 12,350 8.0 years Tradenames 12,921 — (6,253 ) 6,668 9.5 years Patents and technology 5,805 198 (2,381 ) 3,622 11.9 years Non-compete agreements 4,100 — (3,729 ) 371 4.8 years Other 324 — (290 ) 34 4.1 years Total amortizable assets $ 64,650 $ 198 $ (41,803 ) $ 23,045 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 lives, which results in accelerated amortization. The remaining long-lived intangible assets are amortized using the straight-line method over their estimated useful life. For the years ended December 31, 2016, 2015, and 2014 amortization expense was $13,495, $8,562, and $9,811, respectively. Amortization expense was primarily recorded as a component of operating expense, however, amortization expense related to acquired technology in 2016, 2015, and 2014 of $110, $109, and $102, respectively, was recorded as a component of cost of sales. During the fourth quarter of 2015, the Company acquired certain patents and patent applications from a third party. The patents and patent applications relate to the screen protection product line and were acquired for consideration of 21 shares of ZAGG Inc common stock, which had a value of $198 on the date of acquisition. The $198 in patent acquisition costs is being amortized over the 14-year remaining weighted average life of the patents. Estimated future amortization expense for long-lived intangibles is as follows: 2017 $ 12,387 2018 11,351 2019 9,267 2020 6,653 2021 4,148 Thereafter 9,556 Total $ 53,362 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
INCOME TAXES | (6) INCOME TAXES Income (loss) from continuing operations before taxes for the years ended December 31, 2016, 2015, and 2014 consisted of the following: 2016 2015 2014 US Operations $ (22,220 ) $ 26,852 $ 19,487 Foreign Operations (1,339 ) (1,154 ) (2,553 ) Total $ (23,559 ) $ 25,698 $ 16,934 2016 2015 2014 Current benefit (provision): Federal $ (89 ) $ (9,429 ) $ (9,705 ) State 138 (1,783 ) (2,502 ) Foreign (31 ) (61 ) (36 ) Total current 18 (11,273 ) (12,243 ) Deferred benefit (provision): Federal 7,612 973 4,144 State 342 189 1,626 Foreign — — — Total deferred 7,954 1,162 5,770 Total benefit (provision) $ 7,972 $ (10,111 ) $ (6,473 ) 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, 2016, 2015 and 2014: 2016 2015 2014 Tax at statutory rate (35%) $ 8,246 $ (8,994 ) $ (5,927 ) State tax, net of federal tax benefit 1,041 (1,089 ) (955 ) Non-deductible expense and other 333 116 220 Foreign tax rate differential (491 ) (464 ) (900 ) Domestic production activities deduction — 459 688 Return to provision adjustment (36 ) 126 453 Reserve related to unrecognized tax benefits (452 ) (264 ) (541 ) Interest and penalties (14 ) (1 ) (37 ) Effect of state rate changes, net of federal tax benefit (655 ) — 526 $ 7,972 $ (10,111 ) $ (6,473 ) The tax effects of temporary differences that gave rise to significant portions of deferred tax assets and liabilities at December 31, 2016 and 2015, are as follows: 2016 2015 Deferred tax assets: Allowance for doubtful accounts $ 286 $ 196 Deferred revenue 27 7 Inventories 12,724 5,581 Stock-based compensation 1,857 2,406 Sales returns accrual 7,788 2,974 Acquisition costs, net of amortization 191 217 Intangible assets 77 12,924 Goodwill 1,663 1,886 HzO investment 1,483 1,520 Capital loss carry-over 271 278 Reserve on note receivable 328 336 Net operating loss carryforward 21,313 — Federal credit carryforwards 2,816 — Other liabilities 1,619 499 Deferred tax assets 52,443 28,824 Valuation allowance (1,753 ) (1,798 ) Total deferred tax assets $ 50,690 $ 27,026 Deferred tax liabilities: Property and equipment 323 800 Other 4 — Total gross deferred tax liabilities 327 800 Net deferred tax assets 50,363 $ 26,226 Deferred tax assets, net – current $ 23,050 $ 10,840 Deferred tax assets, net – noncurrent 27,313 15,386 Net deferred tax assets $ 50,363 $ 26,226 The Company recorded a full valuation allowance against a deferred tax asset generated by capital 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, 2016 and 2015 of $1,483 and $1,520, respectively, has been recorded against this deferred tax asset. In addition, at December 31, 2016 and 2015, the Company recorded a full valuation allowance against deferred tax assets resulting from capital loss carry-overs of $271 and $278, respectively, as the Company determined that it was unlikely the capital loss carry-overs would be utilized. A t December 31, 2016, we had federal net operating loss carryforwards of approximately $57 million and state net operating loss carryforwards of approximately $35 million, which may be used to offset future taxable income. The net operating loss carryforwards will expire on various dates from 2034 through 2036. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future. In evaluating our ability to recover our deferred tax assets, the Company considers all available positive and negative evidence, including but not limited to scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies, and results of recent operations. The assumptions about future taxable income require the use of significant judgment and are consistent with the plans and estimates we are using to manage the underlying businesses. Additionally, we consider historical performance in our evaluation of the realizability of deferred tax assets, specifically, three years of cumulative operating income (loss). Weighing both the positive and negative evidence, management concludes no valuation allowance The Company has not recognized a deferred tax liability for the undistributed earnings of its foreign operations that arose in 2016 and prior years as the Company considers these earnings to be permanently reinvested. Cash held by foreign entities that is considered permanently re-invested totaled $4,458 as of December 31, 2016. Currently, there are no earnings and profits that reside in the Company’s foreign operations. A repatriation of cash would likely result in a return of basis. Upon the generation of future cumulative taxable income by the foreign operations and subsequent repatriation, the Company would need to accrue and pay the related tax. However, no tax would accrue in the case of the settlement of intercompany payables or payment of intercompany royalties. The Company considers these funds permanently re-invested and has no plans to repatriate them. The Company recognizes the impact of a tax position in the financial statements if that position is more likely than not of being sustained upon audit, based on the technical merits of the position. As of December 31, 2016 and 2015, the Company recorded a tax contingency of $2,230 and $1,265, respectively. The tax contingencies are primarily related to the Company's global tax strategy, certain transactions in foreign jurisdictions in prior periods, and research and development credits taken for federal and state purposes. Another component of the tax contingency relates to the mophie acquisition which relate to research and development credits taken for federal and state purposes. The tax contingencies, on a gross basis, are reconciled in the table below: 2016 2015 Unrecognized tax benefits, as of January 1 $ 1,265 $ 1,001 Unrecognized tax benefits assumed in acquisition 513 - Gross increases – tax positions in current period 452 264 Total benefit $ 2,230 $ 1,265 As of December 31, 2016, the Company's liability related to unrecognized tax benefits was $2,230 of which $2,081 would impact the Company’s effective tax rate if recognized. For the years ended December 31, 2016, 2015, and 2014, the Company recorded $12, $2, and $37, respectively, in each year in interest and penalties. ZAGG, on a separate company basis, is currently under examination by the Internal Revenue Service (“IRS”) for an amended federal tax return filed for 2012. The examination pertains to the research and development credit and the domestic manufacturing deduction. ZAGG is not currently under examination by any state tax authority, but remains subject to income tax examinations for each of its open tax years, which extend back to 2013 for federal income tax purposes and 2012 for state income tax purposes. mophie, on a separate company basis, is currently under examination by the IRS for the years 2012 to 2015. While the IRS has not yet issued its final examination report, the IRS has indicated that the examination has been concluded for the 2012 to 2014 years with adjustments to (1) increase taxable income by $231 during the 2012 to 2015 period and (2) increase the research and development credit by $21 during the 2012 to 2014 period. These adjustments have been incorporated into the 2016 financial statements. The examination for the 2015 is currently underway and no adjustments have been proposed. mophie is not currently under examination by any state tax authority, but remains subject to income tax examinations for each of its open tax years, which extend back to 2012 for federal income tax purposes and 2012 for state income tax purposes. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Measurements [Abstract] | |
FAIR VALUE MEASUREMENTS | (7) FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments At December 31, 2016 and 2015, the Company’s financial instruments included cash and cash equivalents, accounts receivable, accounts payable, a line of credit, and a term loan Fair Value Measurements At December 31, 2016 and 2015, 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: December 31, 2016 Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — Fair Value Measurements Using: December 31, 2015 Level 1 Inputs Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 375 $ 375 — — |
Note Receivable
Note Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Note Receivable [Abstract] | |
NOTE RECEIVABLE | (8) NOTE RECEIVABLE The Company entered into an agreement with a third party for a collateral-dependent note receivable on March 23, 2011. As of December 31, 2016 and December 31, 2015, the unpaid balance on the note receivable was fully reserved. The total unpaid principal balance, including accrued interest, late fees, attorney fees, and costs incurred in collection, as of December 31, 2016 and December 31, 2015 totaled $5,273 and $4,836, respectively. The increase to the reserve during the year ended December 31, 2016 consisted of accrued interest of $437. Additionally, as of December 31, 2016 the Company has foreclosed on all available collateral securing the loan; the remaining outstanding balance is unsecured. |
Debt and Letters of Credit
Debt and Letters of Credit | 12 Months Ended |
Dec. 31, 2016 | |
Debt and Letters of Credit [Abstract] | |
DEBT AND LETTERS OF CREDIT | (9) DEBT AND LETTERS OF CREDIT On March 3, 2016, the Company entered into a Credit and Security Agreement (“Credit and Security Agreement”) with KeyBank, as the administrative agent, KeyBanc Capital Markets Inc., JP Morgan Chase Bank, N.A. and ZB, N.A., dba Zions First National Bank. The Credit and Security Agreement provides an $85,000 revolving credit commitment (“Line of Credit”). Borrowings and repayments under the Line of Credit may occur from time to time in the Company’s ordinary course of business through the maturity date of March 2, 2021, at which time any amounts outstanding are to be paid in full (60-month term). All borrowings under the Line of Credit are subject to a borrowing base limit, which is calculated from outstanding accounts receivable and inventory, and reported to the administrative agent at least monthly. Interest on the Line of Credit will accrue at the base rate plus 0.5% or LIBOR plus 1.5%. The Line of Credit is subject to an unused line fee calculated as 0.2% multiplied by the average unused amount of the Line of Credit. The Credit and Security Agreement also provides a $25,000 term loan commitment (“Term Loan”). Principal and interest payments on the Term Loan are to be made in consecutive monthly installments of $521 commencing on April 1, 2016 and continuing until the Term Loan is paid in full on March 2, 2020 (48-month term). Interest on the Term Loan will accrue at the base rate plus 1.0% or at a rate of LIBOR plus 2.0%. The Credit and Security Agreement also provides for letters of credit with a fronting fee of 0.125% (paid per annum) for all issued and outstanding letters of credit. The Credit and Security Agreement provides for a lockbox and cash collateral account that will be maintained with KeyBank. The Credit and Security Agreement is collateralized by substantially all of the assets of the Company. The Credit and Security Agreement establishes two debt covenants that are measured on a quarterly basis starting with the quarter-ended June 30, 2016: ● Maximum Leverage Ratio ● Minimum Fixed Charge Coverage Ratio In connection with the establishment of the Credit and Security Agreement, the Company incurred and capitalized $1,144 of direct costs; $884 of the costs are related to the line of credit and as such are reflected as a component of other assets, and $260 was reflected as an offset to long-term debt in the consolidated balance sheet. For the year ended December 31, 2016, the Company amortized $202 of these loan costs, which are included as a component of interest expense in the consolidated statements of operations. For the years ended December 31, 2016 and 2015, $56 and $38, 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, 2016, the interest rate on the Line of Credit was 2.21%, the outstanding balance was $31,307. At December 31, 2015, there were no amounts outstanding. At December 31, 2016, the weighted average interest rate on all outstanding borrowings under the revolving line of credit was 2.21%. At December 31, 2016, the effective interest rate on the Term Loan was 3.16%. The Credit and Security Agreement includes a clause requiring a mandatory prepayment of a portion of the Term Loan calculated as 25% of Excess Cash Flows (as defined in the Credit and Security Agreement) for the year-ended 2016. Management performed the calculation at December 31, 2016 and determined that a prepayment of $4,299 will be required under the terms of the Credit and Security Agreement, which will be due on June 30, 2017. The amount of the mandatory prepayment along with other scheduled monthly payments are included in the current portion of long-term debt, net of deferred loan costs on the consolidated balance sheet. Contractual future payments under the Credit and Security Agreement are as follows: Line of Credit Term Loan Total 2017 $ — $ 10,549 $ 10,549 2018 — 6,250 6,250 2019 — 3,514 3,514 2020 — — — 2021 31,307 — 31,307 Thereafter — — — Total $ 31,307 $ 20,313 $ 51,620 |
Stock Options Warrants and Rest
Stock Options Warrants and Restricted Stock | 12 Months Ended |
Dec. 31, 2016 | |
Stock Options Warrants and Restricted Stock [Abstract] | |
STOCK OPTIONS, WARRANTS, AND RESTRICTED STOCK | (10) 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”). 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. adoption of the 2013 Plan in January 2013, the Company ceased to grant awards pursuant to the 2007 Plan, though 6,239 shares remained available to grant under 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. 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. 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 2016, 2015, or 2014. The following table summarizes the stock option activity for the Company’s stock incentive plans for the year ended December 31, 2016: Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Net Aggregate Intrinsic Value (In thousands) (Per share) (In years) (In thousands) Outstanding at December 31, 2015 93 $ 8.14 0.2 $ 259 Exercised (93 ) 8.14 - - Outstanding at December 31, 2016 - $ - - $ - The total intrinsic value of options exercised during the years ended December 31, 2016, 2015, and 2014, was $14, $416, and $417, respectively. As of December 31, 2016, 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 options vested (no options vested in 2016 or 2015) during the years ended December 31, 2016, 2015 and 2014, was $0, $0, and $154, 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, 2016, 2015 and 2014, the Company recorded equity-based compensation expense of $0, $0 and $28, 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, 2016, 2015 and 2014 was $0, $0, and $73, respectively. The tax benefit realized from stock options exercised for the year ended December 31, 2016, 2015, and 2014 was $48, $151, and $73, respectively. Warrants During the years ended December 31, 2016, 2015, and 2014, the Company did not grant warrants to purchase common stock. Warrants outstanding at December 31, 2016 were granted prior to 2013. For the years ended December 31, 2016, 2015, and 2014, the Company recorded expense of zero in each respective year related to warrant grants. The following table summarizes the warrant activity for the year ended December 31, 2016: Warrants Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Net Aggregate Intrinsic Value (In thousands) (Per share) (In years) (In thousands) Outstanding at December 31, 2015 78 $ 9.03 0.7 $ 148 Exercised (28 ) 9.05 - - Outstanding at December 31, 2016 50 $ 9.02 0.1 $ (96 ) Exercisable at December 31, 2016 50 $ 9.02 0.1 $ (96 ) The weighted-average and grant-date or vest-date fair value of warrants granted during the years ended December 31, 2016, 2015, and 2014, was zero as no grants occurred from 2014 to 2016. The total intrinsic value of warrants exercised during the years ended December 31, 2016, 2015 and 2014, was $0, $277, and $18, respectively. As of December 31, 2016, 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, 2016, 2015, and 2014 was $0, $0, and $33, 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, 2016, 2015 and 2014, the Company recorded equity-based compensation expense related to warrants of zero in each respective year. The net tax benefit recognized on equity-based compensation expense related to warrants for the year ended December 31, 2016, 2015 and 2014 was zero in each respective year. The tax benefit realized from compensatory warrants exercised for the years ended December 31, 2016, 2015, and 2014 was $0, $69, and $9, 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, 2016, and changes during the year ended December 31, 2016, is presented below: Restricted Stock Weighted-Average Grant Date Fair Value (In thousands) (Per share) Outstanding at December 31, 2015 782 $ 6.47 Granted 1,071 7.85 Vested (684 ) 6.33 Forfeited (403 ) 7.66 Outstanding at December 31, 2016 766 $ 7.89 As of December 31, 2016, there was $3,530 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. The Company recognizes compensation expense on a straight-line basis for those performance-based awards that management estimates the performance criteria are probable to be achieved. During the years ended December 31, 2016, 2015, and 2014, the Company recorded equity-based compensation expense of $3,830, $3,893, and $2,220, 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, 2016, 2015, and 2014, was $1,465, $1,489, and $785, respectively. The tax benefit realized from vested restricted stock for the years ended December 31, 2016, 2015, and 2014, was $2,119, $1,014, and $378, respectively. During the years ended December 31, 2016, 2015, and 2014, certain ZAGG employees elected to receive a net amount of shares upon the vesting of restricted stock grants 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 $630, $724, and $75, respectively, as a reduction to additional paid-in capital. |
Treasury Stock
Treasury Stock | 12 Months Ended |
Dec. 31, 2016 | |
Treasury Stock [Abstract] | |
TREASURY STOCK | (11) TREASURY STOCK During the fourth quarter of 2015, the Company’s board of directors authorized the repurchase of up to $20,000 of the Company’s outstanding common stock with no expiration date. The Company’s board of directors also authorized the use of a Rule 10b5-1 plan, which was put into place during the fourth quarter of 2016. For the years ended December 31, 2016 and 2015, the Company purchased 152 and 2,030 shares, respectively, of ZAGG Inc common stock. Cash consideration paid for the purchase of ZAGG Inc common stock for the years ended December 31, 2016 and 2015 was $951 and $14,930, respectively, which included commissions paid to brokers of $6 and $61, respectively. For the years ended December 31, 2016 and 2015, the weighted average price per share was $6.23 and $7.32, respectively. The consideration paid has been recorded within stockholders’ equity in the consolidated balance sheet. In addition, during the third quarter of 2015, the Company foreclosed on 80 shares of ZAGG Inc common stock linked to the full recourse note receivable. The Company foreclosed on these shares at a price per share of $8.59 and a total value of $688. These shares are currently being held by the Company as treasury stock. |
Defined Contribution Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2016 | |
Defined Contribution Plan [Abstract] | |
DEFINED CONTRIBUTION PLAN | (12) DEFINED CONTRIBUTION PLAN The Company offers a 401(k) plan for full-time employees that have been with the Company for over 90 days. The Company matches participant contributions of 100% up to 5% of an employees’ salary. Costs recognized for the year ended December 31, 2016, 2015, and 2014 related to the employer 401(k) match totaled $941, $335, and $414, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | (13) COMMITMENTS AND CONTINGENCIES Operating leases The Company leases office and warehouse space, office equipment, and mall cart locations under operating leases that expire through 2023. Future minimum rental payments required under the operating leases at December 31, 2016 are as follows: 2017 $ 2,923 2018 2,165 2019 1,708 2020 1,522 2021 1,448 Thereafter 2,556 Total $ 12,322 For the years ended December 31, 2016, 2015 and 2014, rent expense was $3,190, $1,642, and $1,640, respectively. Rent expense is recognized on a basis which approximates straight line over the lease term. Rent expense for the years ended December 31, 2016, 2015, and 2014 was net of sublease income of $0, $0, and $910 respectively. Rent expense, net of sublease income, is recorded as a component of selling, general and administrative expense on the consolidated statement of operations. Commercial Litigation Daniel Huang, individually and as shareholder representative v. ZAGG Inc, Court of Chancery of the State of Delaware, C.A. No. 12842. ZAGG Inc et al. v. Daniel Huang et al., Orange County Superior Court, State of California, Civil No. 30-2016-00892767-CU-BC-CJC Peter Kravitz v. ZAGG Inc., U.S. Bankruptcy Court, District of Delaware, Adv. Pro. No. 15-51558(BLS). Eric Stotz and Alan Charles v. mophie inc., U.S. District Court, Central District of California, Civil Action No. 2:16-cv-08898-GW-FFM. Patent/Trademark Litigation Inter Partes Review of Patent No. 8,567,596 B1 in the United States Patent and Trademark Office, Patent Trial and Appeal Board (“PTAB”), Case IPR2014-01262. MobileExp, LLC v. mophie inc., U.S. District Court, Eastern District of Texas, Civil Action No. 2:16-cv-1340. 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 an 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 former Chief Executive Officer Robert Pedersen’s pledge and subsequent sale of Company shares and the Company’s failure to disclose such pledges and sales. The Company responded to these requests and is cooperating with the staff although there has been no resolution to date. Other Litigation The Company is not a party to any other material litigation or 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 records a liability when a particular contingency is probable and estimable. Other than those discussed above, the Company has not accrued for any loss at December 31, 2016 in the consolidated financial statements as the Company does not consider a loss to be probable or 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, 2016 | |
Concentrations [Abstract] | |
CONCENTRATIONS | (14) 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, 2016. At December 31, 2016, the balance of accounts receivable from three separate customers exceeded 10%: Superior Communications, Inc. (“Superior”), Best Buy Co., Inc. (“Best Buy”), and GENCO Distribution Systems, Inc.(“GENCO”). At December 31, 2015, the balance of accounts receivable from two separate customers exceeded 10%: 2016 2015 Superior 32 % 31 % Best Buy 22 % 29 % GENCO 10 % 5 % No other customer account balances were more than 10% of accounts receivable at December 31, 2016 or 2015. 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 We do not directly manufacture any of our products, rather, we employ various third party manufacturing partners in the United States and Asia to perform these services on our behalf. The services employed by these third parties include the selection of sub-suppliers that provide raw materials and other components used in the manufacturing process. We have endeavored to use common components and readily available raw materials in the design of our products that can be sourced from multiple sub-suppliers. However, raw film used in our InvisibleShield film and InvisibleShield On-Demand (“ISOD”) products has been produced by a single supplier for the last nine years. Our film supplier has contractually agreed to not sell the raw materials to any of our competitors. Below is a high-level summary by product category of the manufacturing sources used by the Company: ● Screen Protection ● Battery Cases and Power Management ● Keyboards ● Audio Our product and operations teams work closely with suppliers from initial product development and throughout the manufacturing process to ensure that (1) the supplier understands and will build according to product specifications, (2) appropriate quality is maintained for the finished goods and for all sub-components, and (3) the supplier can meet our supply needs. Concentration of sales For the years ended December 31, 2016, 2015, or 2014, Superior, Best Buy, and GENCO were our largest customers which accounted for over 10% of sales as follows: 2016 2015 2014 Superior 27 % 17 % 6 % Best Buy 11 % 20 % 30 % GENCO 11 % 11 % 11 % During 2016 and 2015 no other customers accounted for greater than 10% of net sales and in 2014, one other customer accounted for greater than 10% of net sales. Other than Superior, Best Buy and GENCO, those customers with over 10% of net sales in a given year tend to change from year-to-year. Although we have contracts in place governing our relationships with customers, the contracts are not long-term and all of our retailers generally purchase from us on a purchase order basis. As a result, these retailers generally may, with little or no notice or penalty, cease ordering and selling our products, or materially reduce their orders. If any of these retailers cease selling our products, slow their rate of purchase of our products, or decrease the number of products they purchase, our results of operations could be adversely affected. The percentage of sales by geographic region for the years ended December 31, 2016, 2015 and 2014, was approximately: 2016 2015 2014 United States 88 % 91 % 90 % Europe 7 % 8 % 7 % Other 5 % 1 % 3 % At December 31, 2016 and 2015, net assets located overseas in international locations totaled $16,588 and $8,387, respectively. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | (15) SEGMENT REPORTING The Company designs, produces, and distributes professional and premium creative product solutions in domestic and international markets. The Company’s operations are conducted in two reporting business segments: ZAGG and mophie. The Company defines its segments as those operations whose results its chief operating decision maker regularly reviews to analyze performance and allocate resources. The results of operations of mophie are included in the Company’s results of operations beginning on March 3, 2016. The ZAGG segment designs and distributes screen protection, keyboards for tablet computers and other mobile devices, earbuds, headphones, Bluetooth speakers, mobile power, cables, and cases under the ZAGG, InvisibleShield, and IFROGZ brands. Domestic operations are headquartered in Midvale, Utah, while international operations are directed from Shannon, Ireland. The mophie segment designs and distributes power cases, mobile power, cases, and cables under the mophie brand. Worldwide operations are headquartered in Tustin, California. The Company measures the results of its segments using, among other measures, each segment's net sales, gross profit, and operating income (loss). Net sales by segment are as follows: 2016 2015 ZAGG segment $ 288,108 $ 269,311 mophie segment 113,749 — Net sales $ 401,857 $ 269,311 Gross profit by segment is as follows: 2016 2015 ZAGG segment $ 115,123 $ 101,684 mophie segment 12,479 — Gross profit $ 127,602 $ 101,684 Income (loss) from operations by segment is as follows: 2016 2015 ZAGG segment $ 9,817 $ 25,864 mophie segment (31,177 ) — Income (loss) from operations $ (21,360 ) $ 25,864 Total assets by segment are as follows: December 31, 2016 December 31, 2015 ZAGG segment $ 156,123 $ 179,541 mophie segment 154,606 — Total assets $ 310,729 $ 179,541 |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Data [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | (16) QUARTERLY FINANCIAL DATA (UNAUDITED) Quarterly financial information is presented in the following summary: Year ended December 31, 2016 First Second Third Fourth Year Net sales $ 62,432 $ 99,833 $ 124,662 $ 114,930 $ 401,857 Loss from operations (3,703 ) (1,352 ) (12,710 ) (3,595 ) (21,360 ) Net loss (3,290 ) (1,046 ) (7,105 ) (4,146 ) (15,587 ) Earnings (loss) per share: (1) Basic $ (0.12 ) $ (0.04 ) $ (0.25 ) $ (0.15 ) $ (0.56 ) Diluted (0.12 ) (0.04 ) (0.25 ) (0.15 ) (0.56 ) Weighted average common shares: Basic 27,710 28,126 28,125 28,061 28,006 Diluted 27,710 28,126 28,125 28,061 28,006 Year ended December 31, 2015 First Second Third Fourth Year Net sales $ 57,216 $ 66,689 $ 66,774 $ 78,632 $ 269,311 Income from operations 5,439 6,253 6,228 7,944 25,864 Net income 3,200 3,691 3,739 4,957 15,587 Earnings per share: (1) Basic $ 0.11 $ 0.13 $ 0.13 $ 0.18 $ 0.54 Diluted 0.11 0.12 0.13 0.18 0.54 Weighted average common shares: Basic 29,380 29,521 28,734 27,483 28,773 Diluted 29,678 29,754 28,930 28,022 29,089 (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 S25
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
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 inventory write-downs, sales returns and warranty liability, 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. (“ZAGG IP”); ZAGG Retail, Inc; mophie inc.; mophie LLC; mophie Technology Development Co., Ltd; mophie Netherlands Coöperatie U.A.; and mophie Limited. All intercompany transactions and balances have been eliminated in consolidation. The Company holds an investment in HzO, Inc. (“HzO”), a private company engaged in the development of water-blocking technologies for consumer and industrial applications. The investment is less than 20% and thus is accounted for under the cost method. Due to accumulated losses, the carrying amount of the investment in HzO was $0 at December 31, 2016 and 2015. In connection with the acquisition of mophie, the Company changed its operating segments, as described in Note 15. |
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, 2016 and 2015 totaled $264 and $61, respectively. Cash equivalents as of December 31, 2016 and 2015, 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, 2016, 2015 and 2014: For the Years Ended December 31, 2016 2015 2014 Balance at beginning of year $ 568 $ 1,910 $ 2,540 Additions charged to expense 599 243 389 Assumed in acquisition of mophie 91 - - Write-offs charged against the allowance (430 ) (1,585 ) (1,019 ) Foreign currency translation loss (4 ) - - Balance at end of year $ 824 $ 568 $ 1,910 |
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. |
Goodwill | Goodwill At least annually and when events and circumstances warrant an evaluation, we perform our impairment assessment of goodwill. This assessment initially permits an entity to make a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount before applying the two-step goodwill impairment test. If an entity can support the conclusion that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it would not need to perform the two-step impairment test for the reporting unit. If it is determined that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the two-step analysis is performed, which incorporates a fair-value based approach. We determine the fair value of our reporting units based on discounted cash flows and market approach analyses as considered necessary. We consider factors such as the economy, reduced expectations for future cash flows coupled with a decline in the market price of our stock and market capitalization for a sustained period as indicators for potential goodwill impairment. If the reporting unit’s carrying amount exceeds its estimated fair value, a second step must be performed to measure the amount of the goodwill impairment loss, if any. The second step compares the implied fair value of the reporting unit’s goodwill, determined in the same manner as the amount of goodwill recognized in a business combination, with the carrying amount of such goodwill. If the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. |
Intangibles assets | Intangibles assets Intangible assets include internet addresses, intellectual property, and acquired intangibles in connection with the acquisitions of IFROGZ and mophie, which include patents, technology, customer relationships, trademarks, tradenames, non-compete agreements, and other miscellaneous intangible assets. Long-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 amortizing 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 or risk of loss has transferred to the customer, 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.mophie.com 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 impact is recorded as a reduction of revenues and cost of sales, and as a reduction in the 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, warranty, and other credits liability for the years ended December 31, 2016, 2015 and 2014: 2016 2015 2014 Balance at beginning of year $ 7,849 $ 8,674 $ 7,872 Additions charged to sales 92,868 43,320 35,923 Assumed in acquisition of mophie 29,584 - - Sales returns & warranty claims charged against reserve (101,928 ) (44,145 ) (35,121 ) $ 28,373 $ 7,849 $ 8,674 |
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. The Company recognizes compensation expense on a straight-line basis for those performance-based awards that management estimates the performance criteria are probable to be achieved. 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, 2016, 2015 and 2014 were $12,440, $10,436 and $7,542, 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 in Ireland and the Netherlands, while the Renminbi is the functional currency of the Company’s subsidiary in China. 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 ($144), $52 and $149 for the years ended December 31, 2016, 2015 and 2014, 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, 2016, 2015 and 2014: 2016 2015 2014 Net (loss) income $ (15,587 ) $ 15,587 $ 10,461 Weighted average shares outstanding: Basic 28,006 28,773 30,247 Dilutive effect of stock options, restricted stock, and warrants - 316 363 Diluted 28,006 29,089 30,610 Earnings (loss) per share: Basic $ (0.56 ) $ 0.54 $ 0.35 Dilutive $ (0.56 ) $ 0.54 $ 0.34 For the year ended December 31, 2016, 765 restricted stock units and warrants to purchase 50 shares of common stock were not considered in calculating diluted earnings per share as their effect would have been anti-dilutive. For the years ended December 31, 2015, and 2014, restricted stock units, warrants and stock options to purchase 250, and 485 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 units, or stock options was greater than the average market price of common shares during the period and, therefore, the effect would be anti-dilutive. |
Business combinations | Business combinations We allocate the purchase price of acquired companies to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase price over these fair values is recorded as goodwill. We engaged an independent third-party valuation firm to assist us in determining the fair values of certain assets acquired and liabilities assumed. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. The significant purchased classes of intangible assets recorded by us include tradenames, technology, customer relationships, non-compete agreements, and backlog. The fair values assigned to the identified intangible assets are discussed in Note 4 to the consolidated financial statements. Significant estimates in valuing certain intangible assets include but are not limited to: future expected cash flows related to each individual asset, market position of the tradenames and assumptions about cash flow savings from the tradenames, determination of useful lives, and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and thus, actual results may differ from estimates. |
Recent accounting pronouncements | Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an 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 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 may be adopted utilizing one of two methods. The first method is to adopt the ASU by recording the effect of the guidance in the ASU retrospectively to each prior period presented in the period of adoption. The second method is to adopt the ASU by recording the effect of the guidance in the ASU retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application. On July 9, 2015, the FASB voted to approve a one-year deferral of the effective date of this ASU. This deferral was issued by the FASB in ASU No. 2015-14, “Revenue from Contracts with Customers (Topic 606) – Deferral of the Effective Date”. As a result of ASU No. 2015-14, the Company expects that it will apply the new revenue standard to annual and interim reporting periods beginning after December 15, 2017. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606) – Narrow-Scope Improvements and Practical Expedients”. The amendments and practical expedients presented in the ASU aim to simplify the transition to the new standard, to provide practical expedients for transition and sales taxes, and to clarify certain aspects of the standard. The Company currently anticipates adopting the standard retrospectively with the cumulative effect of adoption recorded at the date of initial application. The Company is currently evaluating the impact the ASU will have on its consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory.” This ASU provides guidance to entities that measure inventory using a method other than last-in, first-out (LIFO) or the retail inventory method. For entities using first-in, first-out (FIFO) or average cost, the measurement principle for their inventory changes from the lower of cost or market to lower of cost or net realizable value. Current U.S. GAAP requires, at each financial statement date, that entities measure inventory at the lower of cost or market. The measurement of market is commonly the current replacement cost. However, entities also need to consider net realizable value and net realizable value less an approximately normal profit margin in their measurement. For entities using a method other than LIFO or the retail inventory method, the ASU replaces market with net realizable value. This ASU requires prospective adoption for inventory measurement for annual and interim periods beginning after December 15, 2016 for public business entities. The Company expects that this ASU will not have a significant impact on our financial position or results of operations. In November 2015, the FASB issued ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes,” which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as noncurrent. The amendments in the ASU may be applied either prospectively to all deferred tax liabilities and assets or retrospectively to all periods presented. The ASU is effective for public business entities for interim and annual periods in fiscal years beginning after December 15, 2016. The Company has determined that it will adopt the ASU using the retrospective approach and expects that the adoption of this ASU will result in recording deferred tax assets as non-current and will not impact our results of operations. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 542)”, which requires lessees to recognize most leases, including operating leases, on-balance sheet via a right of use asset and lease liability. Lessees are allowed to account for short-term leases (i.e., leases with a term of 12 months or less) off-balance sheet, consistent with current operating lease accounting. A number of other significant changes to lease accounting have been effected through the issuance of this standard. The requirements of the new standard for leases shall be recognized and measured at the beginning of the earliest comparative period presented. When adopted, the Company will be required to adjust equity at the beginning of the earliest comparative period presented, and the other comparative amounts disclosed for each prior period presented in the financial statements, as if the requirements of the new standard had always been applied. The new standard also contains practical expedients which the Company may elect to follow. The new standard is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including whether to elect the practical expedients outlined in the new standard. In March 2016, the FASB issued ASU No. 2016-09, “Improvements to Employee Share-Based Payment Accounting,” which simplified accounting for share-based payments. The ASU is effective for fiscal years beginning after December 15, 2016, and interim periods within those years for public business entities. Early adoption is permitted in any interim or annual period provided that the entire ASU is adopted. Amendments in the ASU related to the timing of when excess tax benefits are recognized, minimum statutory withholding requirements, forfeitures, and intrinsic value should be applied using a modified retrospective transition method by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted. Amendments related to the presentation of employee taxes paid on the statement of cash flows when an employer withholds shares should be applied retrospectively. Amendments requiring the recognition of excess tax benefits and tax deficiencies in the income statement should be applied prospectively. The amendments related to the presentation of excess tax benefits on the statement of cash flows may be applied using either a prospective or retrospective transition method. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including, where applicable, determining the method of adoption. In August 2016, the FASB issued ASU No. 2016-15, “Classification of Certain Cash Receipts and Cash Payments,” which addresses eight classification issues related to the statement of cash flows: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. The ASU is effective for public companies for fiscal years beginning after December 15, 2017. Early adoption is permitted, including adoption in an interim period. The amendments in the ASU should be applied using a retrospective transition method to each period presented. If it is impracticable for the amendments to be applied retrospectively for some of the issues, the amendments for those issues may be applied prospectively as of the earliest date practicable. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements, including the method of adoption. In October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory,” which requires entities to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires companies to include cash and cash equivalents that have restrictions on withdrawal or use in total cash and cash equivalents on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods in fiscal years beginning after December 15, 2017. For all other entities, the ASU is effective for annual periods in fiscal years beginning after December 15, 2018, and interim periods in fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. |
Organization and Summary of S26
Organization and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Organization and Summary of Significant Accounting Policies [Abstract] | |
Schedule of allowance for doubtful accounts activity | For the Years Ended December 31, 2016 2015 2014 Balance at beginning of year $ 568 $ 1,910 $ 2,540 Additions charged to expense 599 243 389 Assumed in acquisition of mophie 91 - - Write-offs charged against the allowance (430 ) (1,585 ) (1,019 ) Foreign currency translation loss (4 ) - - Balance at end of year $ 824 $ 568 $ 1,910 |
Schedule of sales return, warranty, and other credits liability | 2016 2015 2014 Balance at beginning of year $ 7,849 $ 8,674 $ 7,872 Additions charged to sales 92,868 43,320 35,923 Assumed in acquisition of mophie 29,584 - - Sales returns & warranty claims charged against reserve (101,928 ) (44,145 ) (35,121 ) $ 28,373 $ 7,849 $ 8,674 |
Schedule of reconciliation of numerator and denominator used to calculate basic earnings per share and diluted earnings per share | 2016 2015 2014 Net (loss) income $ (15,587 ) $ 15,587 $ 10,461 Weighted average shares outstanding: Basic 28,006 28,773 30,247 Dilutive effect of stock options, restricted stock, and warrants - 316 363 Diluted 28,006 29,089 30,610 Earnings (loss) per share: Basic $ (0.56 ) $ 0.54 $ 0.35 Dilutive $ (0.56 ) $ 0.54 $ 0.34 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventories [Abstract] | |
Schedule of inventories | December 31, 2016 2015 Finished goods $ 72,490 $ 44,764 Raw materials 279 1,148 Total inventories $ 72,769 $ 45,912 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property and Equipment [Abstract] | ||
Schedule of property and equipment, net | December 31, 2016 2015 Useful Lives Computer equipment and software 2 to 5 years $ 3,634 $ 2,912 Equipment and molds 2 to 10 years 16,609 9,536 Furniture and fixtures 1 to 7 years 3,409 745 Automobiles 5 years 230 199 Building and Improvements 40 years 2,270 - Land 325 - Leasehold improvements 1 to 5 years 9,649 5,456 36,126 18,848 Less accumulated depreciation and amortization (18,371 ) (10,539 ) Net property and equipment $ 17,755 $ 8,309 | December 31, 2015 2014 Useful Lives Computer equipment and software 3 to 5 years $ 2,912 $ 2,627 Equipment and molds 3 to 7 years 9,536 8,238 Furniture and fixtures 7 years 745 770 Automobiles 5 years 199 234 Leasehold improvements 1 to 8 years 5,456 3,090 18,848 14,959 Less accumulated depreciation and amortization (10,539 ) (7,659 ) Net property and equipment $ 8,309 $ 7,300 |
Acquisition of Mophie Inc. (Tab
Acquisition of Mophie Inc. (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Acquisition of Mophie Inc. [Abstract] | |
Summary of purchase consideration | Adjustments to Preliminary Allocation Working Capital and Final Allocation March 3, Fair March 3, Cash consideration $ 100,000 $ - $ 100,000 Negative working capital at Acquisition Date (23,478 ) - (23,478 ) Additional negative working capital deficit - (26,317 ) (26,317 ) Contingent payments 11,283 856 12,139 Total purchase price $ 87,805 $ (25,461 ) $ 62,344 |
Summary of assets acquired and liabilities assumed purchase price allocation | Cash and cash equivalents $ 1,779 Trade receivables (gross contractual receivables of $12,914) 12,823 Inventories 24,911 Prepaid expenses and other assets 1,073 Income tax receivable 11,814 Deferred tax assets 16,168 Property and equipment 10,191 Land held for sale 325 Amortizable identifiable intangible assets 43,812 Goodwill 12,272 Accounts payable (37,359 ) Income tax payable (196 ) Accrued liabilities (5,163 ) Deferred revenue (9 ) Sales returns liability (29,584 ) Other noncurrent liabilities (513 ) Total $ 62,344 Preliminary Purchase Adjustments to Final Purchase Price Allocation Working Capital and Price Allocation March 3, Fair March 3, Cash and cash equivalents $ 1,779 $ - $ 1,779 Trade receivables 13,483 (660 ) 12,823 Inventories 32,335 (10,010 ) 22,325 Inventory step-up 6,937 (4,351 ) 2,586 Prepaid expenses 485 215 700 Other assets 200 173 373 Income tax receivable 10,958 856 11,814 Deferred tax assets 24,925 (8,757 ) 16,168 Property and equipment 10,191 - 10,191 Land held for sale 325 - 325 Amortizable identifiable intangible assets 45,463 (1,651 ) 43,812 Goodwill 14,092 (1,820 ) 12,272 Accounts payable (34,228 ) (3,131 ) (37,359 ) Income tax payable (196 ) - (196 ) Accrued liabilities (5,185 ) 22 (5,163 ) Deferred revenue (800 ) 791 (9 ) Sales returns liability (14,468 ) (15,116 ) (29,584 ) Deferred tax liabilities (17,978 ) 17,978 - Other noncurrent liabilities (513 ) - (513 ) Total $ 87,805 $ (25,461 ) $ 62,344 |
Summary of intangible asset class and related preliminary weighted average amortization periods | Intangible asset class Weighted-average amortization period Tradenames $ 18,348 10.0 years Patents and technology 15,225 7.5 years Customer relationships 8,200 5.0 years Non-compete agreements 1,796 5.0 years Backlog 243 0.3 years Total $ 43,812 |
Summary of unaudited pro-forma results of operations | 12 Months Ended December 31, 2016 December 31, 2015 Net sales $ 419,183 $ 455,165 Net loss $ (17,487 ) $ (5,393 ) Basic loss per share $ (0.62 ) $ (0.19 ) Diluted loss per share $ (0.62 ) $ (0.19 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of changes in goodwill | Balance at December 31, 2015 $ — Increase due to acquisitions 12,272 Balance at December 31, 2016 $ 12,272 |
Schedule of long-lived intangibles | As of December 31, 2016 Gross Carrying Amount Acquisitions Accumulated Amortization Net Carrying Amount Weighted Average Amortization Period Customer relationships $ 41,500 $ 8,200 $ (35,088 ) $ 14,612 7.5 years Tradenames 12,921 18,348 (9,763 ) 21,506 9.8 years Patents and technology 6,003 15,225 (5,501 ) 15,727 8.8 years Non-compete agreements 4,100 1,796 (4,399 ) 1,497 4.9 years Other 324 243 (547 ) 20 2.4 years Total amortizable assets $ 64,848 $ 43,812 $ (55,298 ) $ 53,362 8.2 years As of December 31, 2015 Gross Carrying Amount Acquisitions Accumulated Amortization Net Carrying Amount Weighted Average Amortization Period Customer relationships $ 41,500 $ — $ (29,150 ) $ 12,350 8.0 years Tradenames 12,921 — (6,253 ) 6,668 9.5 years Patents and technology 5,805 198 (2,381 ) 3,622 11.9 years Non-compete agreements 4,100 — (3,729 ) 371 4.8 years Other 324 — (290 ) 34 4.1 years Total amortizable assets $ 64,650 $ 198 $ (41,803 ) $ 23,045 8.4 years |
Schedule of estimated future amortization expense for long-lived intangibles | 2017 $ 12,387 2018 11,351 2019 9,267 2020 6,653 2021 4,148 Thereafter 9,556 Total $ 53,362 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Taxes [Abstract] | |
Summary of income (loss) from continuing operations before taxes | 2016 2015 2014 US Operations $ (22,220 ) $ 26,852 $ 19,487 Foreign Operations (1,339 ) (1,154 ) (2,553 ) Total $ (23,559 ) $ 25,698 $ 16,934 |
Summary of income tax benefit (provision) | 2016 2015 2014 Current benefit (provision): Federal $ (89 ) $ (9,429 ) $ (9,705 ) State 138 (1,783 ) (2,502 ) Foreign (31 ) (61 ) (36 ) Total current 18 (11,273 ) (12,243 ) Deferred benefit (provision): Federal 7,612 973 4,144 State 342 189 1,626 Foreign — — — Total deferred 7,954 1,162 5,770 Total benefit (provision) $ 7,972 $ (10,111 ) $ (6,473 ) |
Schedule of effective income tax rate reconciliation | 2016 2015 2014 Tax at statutory rate (35%) $ 8,246 $ (8,994 ) $ (5,927 ) State tax, net of federal tax benefit 1,041 (1,089 ) (955 ) Non-deductible expense and other 333 116 220 Foreign tax rate differential (491 ) (464 ) (900 ) Domestic production activities deduction — 459 688 Return to provision adjustment (36 ) 126 453 Reserve related to unrecognized tax benefits (452 ) (264 ) (541 ) Interest and penalties (14 ) (1 ) (37 ) Effect of state rate changes, net of federal tax benefit (655 ) — 526 $ 7,972 $ (10,111 ) $ (6,473 ) |
Summary of deferred tax assets and liabilities | 2016 2015 Deferred tax assets: Allowance for doubtful accounts $ 286 $ 196 Deferred revenue 27 7 Inventories 12,724 5,581 Stock-based compensation 1,857 2,406 Sales returns accrual 7,788 2,974 Acquisition costs, net of amortization 191 217 Intangible assets 77 12,924 Goodwill 1,663 1,886 HzO investment 1,483 1,520 Capital loss carry-over 271 278 Reserve on note receivable 328 336 Net operating loss carryforward 21,313 — Federal credit carryforwards 2,816 — Other liabilities 1,619 499 Deferred tax assets 52,443 28,824 Valuation allowance (1,753 ) (1,798 ) Total deferred tax assets $ 50,690 $ 27,026 Deferred tax liabilities: Property and equipment 323 800 Other 4 — Total gross deferred tax liabilities 327 800 Net deferred tax assets 50,363 $ 26,226 Deferred tax assets, net – current $ 23,050 $ 10,840 Deferred tax assets, net – noncurrent 27,313 15,386 Net deferred tax assets $ 50,363 $ 26,226 |
Schedule of unrecognized tax benefits | 2016 2015 Unrecognized tax benefits, as of January 1 $ 1,265 $ 1,001 Unrecognized tax benefits assumed in acquisition 513 - Gross increases – tax positions in current period 452 264 Total benefit $ 2,230 $ 1,265 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Measurements [Abstract] | |
Schedule of assets and liabilities measured at fair value on recurring basis | Fair Value Measurements Using: December 31, 2016 Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — Fair Value Measurements Using: December 31, 2015 Level 1 Inputs Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 375 $ 375 — — |
Debt and Letters of Credit (Tab
Debt and Letters of Credit (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt and Letters of Credit [Abstract] | |
Scedule of contractual future payments under the credit and security agreement | Line of Credit Term Loan Total 2017 $ — $ 10,549 $ 10,549 2018 — 6,250 6,250 2019 — 3,514 3,514 2020 — — — 2021 31,307 — 31,307 Thereafter — — — Total $ 31,307 $ 20,313 $ 51,620 |
Stock Options Warrants and Re34
Stock Options Warrants and Restricted Stock (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stock Options Warrants and Restricted Stock [Abstract] | |
Schedule of stock option activity | Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Net Aggregate Intrinsic Value (In thousands) (Per share) (In years) (In thousands) Outstanding at December 31, 2015 93 $ 8.14 0.2 $ 259 Exercised (93 ) 8.14 - - Outstanding at December 31, 2016 - $ - - $ - |
Schedule of warrant activity | Warrants Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Net Aggregate Intrinsic Value (In thousands) (Per share) (In years) (In thousands) Outstanding at December 31, 2015 78 $ 9.03 0.7 $ 148 Exercised (28 ) 9.05 - - Outstanding at December 31, 2016 50 $ 9.02 0.1 $ (96 ) Exercisable at December 31, 2016 50 $ 9.02 0.1 $ (96 ) |
Schedule of restricted stock activity | Restricted Stock Weighted-Average Grant Date Fair Value (In thousands) (Per share) Outstanding at December 31, 2015 782 $ 6.47 Granted 1,071 7.85 Vested (684 ) 6.33 Forfeited (403 ) 7.66 Outstanding at December 31, 2016 766 $ 7.89 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies [Abstract] | |
Schedule of future minimum rental payments required under the operating leases | 2017 $ 2,923 2018 2,165 2019 1,708 2020 1,522 2021 1,448 Thereafter 2,556 Total $ 12,322 |
Concentrations (Tables)
Concentrations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Concentrations [Abstract] | |
Schedules of concentration of accounts receivable and sales | 2016 2015 Superior 32 % 31 % Best Buy 22 % 29 % GENCO 10 % 5 % 2016 2015 2014 Superior 27 % 17 % 6 % Best Buy 11 % 20 % 30 % GENCO 11 % 11 % 11 % |
Schedule of percentage of sales by geographic region | 2016 2015 2014 United States 88 % 91 % 90 % Europe 7 % 8 % 7 % Other 5 % 1 % 3 % |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | 2016 2015 ZAGG segment $ 288,108 $ 269,311 mophie segment 113,749 — Net sales $ 401,857 $ 269,311 2016 2015 ZAGG segment $ 115,123 $ 101,684 mophie segment 12,479 — Gross profit $ 127,602 $ 101,684 2016 2015 ZAGG segment $ 9,817 $ 25,864 mophie segment (31,177 ) — Income (loss) from operations $ (21,360 ) $ 25,864 December 31, 2016 December 31, 2015 ZAGG segment $ 156,123 $ 179,541 mophie segment 154,606 — Total assets $ 310,729 $ 179,541 |
Quarterly Financial Data (Una38
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Data [Abstract] | |
Quarterly financial information | Year ended December 31, 2016 First Second Third Fourth Year Net sales $ 62,432 $ 99,833 $ 124,662 $ 114,930 $ 401,857 Loss from operations (3,703 ) (1,352 ) (12,710 ) (3,595 ) (21,360 ) Net loss (3,290 ) (1,046 ) (7,105 ) (4,146 ) (15,587 ) Earnings (loss) per share: (1) Basic $ (0.12 ) $ (0.04 ) $ (0.25 ) $ (0.15 ) $ (0.56 ) Diluted (0.12 ) (0.04 ) (0.25 ) (0.15 ) (0.56 ) Weighted average common shares: Basic 27,710 28,126 28,125 28,061 28,006 Diluted 27,710 28,126 28,125 28,061 28,006 Year ended December 31, 2015 First Second Third Fourth Year Net sales $ 57,216 $ 66,689 $ 66,774 $ 78,632 $ 269,311 Income from operations 5,439 6,253 6,228 7,944 25,864 Net income 3,200 3,691 3,739 4,957 15,587 Earnings per share: (1) Basic $ 0.11 $ 0.13 $ 0.13 $ 0.18 $ 0.54 Diluted 0.11 0.12 0.13 0.18 0.54 Weighted average common shares: Basic 29,380 29,521 28,734 27,483 28,773 Diluted 29,678 29,754 28,930 28,022 29,089 (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 S39
Organization and Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Organization and Summary of Significant Accounting Policies [Abstract] | |||
Balance at beginning of year | $ 568 | $ 1,910 | $ 2,540 |
Additions charged to expense | 599 | 243 | 389 |
Assumed in acquisition of mophie | 91 | ||
Write-offs charged against the allowance | (430) | (1,585) | (1,019) |
Foreign currency translation loss | (4) | ||
Balance at end of year | $ 824 | $ 568 | $ 1,910 |
Organization and Summary of S40
Organization and Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Organization and Summary of Significant Accounting Policies [Abstract] | |||
Balance at beginning of year | $ 7,849 | $ 8,674 | $ 7,872 |
Additions charged to sales | 92,868 | 43,320 | 35,923 |
Assumed in acquisition of mophie | 29,584 | ||
Sales returns & warranty claims charged against reserve | (101,928) | (44,145) | (35,121) |
Balance at ending of year | $ 28,373 | $ 7,849 | $ 8,674 |
Organization and Summary of S41
Organization and Summary of Significant Accounting Policies (Details 2) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||
Organization and Summary of Significant Accounting Policies [Abstract] | |||||||||||||||||||
Net (loss) income | $ (4,146) | $ (7,105) | $ (1,046) | $ (3,290) | $ 4,957 | $ 3,739 | $ 3,691 | $ 3,200 | $ (15,587) | $ 15,587 | $ 10,461 | ||||||||
Weighted average shares outstanding: | |||||||||||||||||||
Basic | 28,061 | 28,125 | 28,126 | 27,710 | 27,483 | 28,734 | 29,521 | 29,380 | 28,006 | 28,773 | 30,247 | ||||||||
Dilutive effect of stock options, restricted stock, and warrants | 316 | 363 | |||||||||||||||||
Diluted | 28,061 | 28,125 | 28,126 | 27,710 | 28,022 | 28,930 | 29,754 | 29,678 | 28,006 | 29,089 | 30,610 | ||||||||
Earnings (loss) per share: | |||||||||||||||||||
Basic | $ (0.15) | [1] | $ (0.25) | [1] | $ (0.04) | [1] | $ (0.12) | [1] | $ 0.18 | [1] | $ 0.13 | [1] | $ 0.13 | [1] | $ 0.11 | [1] | $ (0.56) | $ 0.54 | $ 0.35 |
Dilutive | $ (0.15) | [1] | $ (0.25) | [1] | $ (0.04) | [1] | $ (0.12) | [1] | $ 0.18 | [1] | $ 0.13 | [1] | $ 0.12 | [1] | $ 0.11 | [1] | $ (0.56) | $ 0.54 | $ 0.34 |
[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 S42
Organization and Summary of Significant Accounting Policies (Details Textual) - USD ($) shares in Thousands, $ in Thousands | Mar. 03, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 21, 2011 |
Organization and summary of significant accounting policies (Textual) | |||||
Maturity term | Three months or less | ||||
Working capital adjustment, net | $ 49,795 | ||||
Percentage of investment decline | 20.00% | ||||
Investment in HzO | $ 0 | $ 0 | |||
Amounts receivable from credit card processors | 264 | $ 61 | |||
Percentage of recognized income tax positions | 50.00% | ||||
Advertising expenses | 12,440 | $ 10,436 | $ 7,542 | ||
Gains (losses) from foreign currency transactions | $ (144) | $ 52 | $ 149 | ||
Restricted stock [Member] | |||||
Organization and summary of significant accounting policies (Textual) | |||||
Shares excluded from computation of diluted earnings per share | 765 | 250 | 485 | ||
Warrants [Member] | |||||
Organization and summary of significant accounting policies (Textual) | |||||
Shares excluded from computation of diluted earnings per share | 50 | 250 | 485 | ||
Stock option [Member] | |||||
Organization and summary of significant accounting policies (Textual) | |||||
Shares excluded from computation of diluted earnings per share | 250 | 485 | |||
iFrogz [Member] | |||||
Organization and summary of significant accounting policies (Textual) | |||||
Percentage of acquired outstanding shares | 100.00% | ||||
Preliminary Allocation [Member] | |||||
Organization and summary of significant accounting policies (Textual) | |||||
Cash consideration | 100,000 | ||||
Working capital adjustment, gross | $ 23,478 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventories [Abstract] | ||
Finished goods | $ 72,490 | $ 44,764 |
Raw materials | 279 | 1,148 |
Total inventories | $ 72,769 | $ 45,912 |
Inventories (Details Textual)
Inventories (Details Textual) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventories (Textual) | ||
Inventory deposits with third-party manufacturers | $ 437 | $ 813 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 36,126 | $ 18,848 |
Less accumulated depreciation and amortization | (18,371) | (10,539) |
Net property and equipment | 17,755 | 8,309 |
Computer equipment and software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 3,634 | 2,912 |
Computer equipment and software [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 2 years | |
Computer equipment and software [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 5 years | |
Equipment and molds [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 16,609 | 9,536 |
Equipment and molds [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 2 years | |
Equipment and molds [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 10 years | |
Furniture and fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 3,409 | 745 |
Furniture and fixtures [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 1 year | |
Furniture and fixtures [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 7 years | |
Automobiles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 230 | 199 |
Property, plant and equipment, Useful Lives | 5 years | |
Building and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,270 | |
Property, plant and equipment, Useful Lives | 40 years | |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 325 | |
Leasehold improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 9,649 | $ 5,456 |
Leasehold improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 1 year | |
Leasehold improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful Lives | 5 years |
Acquisition of Mophie Inc. (Det
Acquisition of Mophie Inc. (Details) $ in Thousands | Mar. 03, 2016USD ($) |
Business Acquisition [Line Items] | |
Total purchase price | $ 62,344 |
Preliminary Allocation [Member] | |
Business Acquisition [Line Items] | |
Cash consideration | 100,000 |
Negative working capital at Acquisition Date | (23,478) |
Contingent payments | 11,283 |
Total purchase price | 87,805 |
Adjustments to Working Capital and Fair Value [Member] | |
Business Acquisition [Line Items] | |
Negative working capital at Acquisition Date | |
Additional negative working capital deficit | (26,317) |
Contingent payments | 856 |
Total purchase price | (25,461) |
Final Allocation [Member] | |
Business Acquisition [Line Items] | |
Negative working capital at Acquisition Date | (23,478) |
Additional negative working capital deficit | (26,317) |
Contingent payments | 12,139 |
Total purchase price | $ 62,344 |
Acquisition of Mophie Inc. (D47
Acquisition of Mophie Inc. (Details 1) $ in Thousands | Mar. 03, 2016USD ($) |
Business Acquisition [Line Items] | |
Cash and cash equivalents | $ 1,779 |
Trade receivables (gross contractual receivables of $12,914) | 12,823 |
Inventories | 24,911 |
Prepaid expenses and other assets | 1,073 |
Income tax receivable | 11,814 |
Deferred tax assets | 16,168 |
Property and equipment | 10,191 |
Land held for sale | 325 |
Amortizable identifiable intangible assets | 43,812 |
Goodwill | 12,272 |
Accounts payable | (37,359) |
Income tax payable | (196) |
Accrued liabilities | (5,163) |
Deferred revenue | (9) |
Sales returns liability | (29,584) |
Other noncurrent liabilities | (513) |
Total | 62,344 |
Preliminary Purchase Price Allocation [Member] | |
Business Acquisition [Line Items] | |
Cash and cash equivalents | 1,779 |
Trade receivables (gross contractual receivables of $12,914) | 13,483 |
Inventories | 32,335 |
Inventory step-up | 6,937 |
Prepaid expenses | 485 |
Other assets | 200 |
Income tax receivable | 10,958 |
Deferred tax assets | 24,925 |
Property and equipment | 10,191 |
Land held for sale | 325 |
Amortizable identifiable intangible assets | 45,463 |
Goodwill | 14,092 |
Accounts payable | (34,228) |
Income tax payable | (196) |
Accrued liabilities | (5,185) |
Deferred revenue | (800) |
Sales returns liability | (14,468) |
Deferred tax liabilities | (17,978) |
Other noncurrent liabilities | (513) |
Total | 87,805 |
Adjustments to Working Capital and Fair Value [Member] | |
Business Acquisition [Line Items] | |
Cash and cash equivalents | |
Trade receivables (gross contractual receivables of $12,914) | (660) |
Inventories | (10,010) |
Inventory step-up | (4,351) |
Prepaid expenses | 215 |
Other assets | 173 |
Income tax receivable | 856 |
Deferred tax assets | (8,757) |
Property and equipment | |
Land held for sale | |
Amortizable identifiable intangible assets | (1,651) |
Goodwill | (1,820) |
Accounts payable | (3,131) |
Income tax payable | |
Accrued liabilities | 22 |
Deferred revenue | 791 |
Sales returns liability | (15,116) |
Deferred tax liabilities | 17,978 |
Other noncurrent liabilities | |
Total | (25,461) |
Final Purchase Price Allocation [Member] | |
Business Acquisition [Line Items] | |
Cash and cash equivalents | 1,779 |
Trade receivables (gross contractual receivables of $12,914) | 12,823 |
Inventories | 22,325 |
Inventory step-up | 2,586 |
Prepaid expenses | 700 |
Other assets | 373 |
Income tax receivable | 11,814 |
Deferred tax assets | 16,168 |
Property and equipment | 10,191 |
Land held for sale | 325 |
Amortizable identifiable intangible assets | 43,812 |
Goodwill | 12,272 |
Accounts payable | (37,359) |
Income tax payable | (196) |
Accrued liabilities | (5,163) |
Deferred revenue | (9) |
Sales returns liability | (29,584) |
Deferred tax liabilities | |
Other noncurrent liabilities | (513) |
Total | $ 62,344 |
Acquisition of Mophie Inc. (D48
Acquisition of Mophie Inc. (Details 2) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 43,812 |
Tradenames [Member] | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 18,348 |
Weighted-average amortization period | 10 years |
Patents and technology [Member] | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 15,225 |
Weighted-average amortization period | 7 years 6 months |
Customer relationships [Member] | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 8,200 |
Weighted-average amortization period | 5 years |
Non-compete agreements [Member] | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 1,796 |
Weighted-average amortization period | 5 years |
Backlog [Member] | |
Business Acquisition [Line Items] | |
Intangible asset class | $ 243 |
Weighted-average amortization period | 3 months 18 days |
Acquisition of Mophie Inc. (D49
Acquisition of Mophie Inc. (Details 3) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Acquisition of Mophie Inc. [Abstract] | ||
Net sales | $ 419,183 | $ 455,165 |
Net loss | $ (17,487) | $ (5,393) |
Basic loss per share | $ (0.62) | $ (0.19) |
Diluted loss per share | $ (0.62) | $ (0.19) |
Acquisition of Mophie Inc. (D50
Acquisition of Mophie Inc. (Details Textual) - USD ($) $ in Thousands | Mar. 03, 2016 | Oct. 21, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 02, 2016 |
Aquisition of Mophie Inc. (Textual) | ||||||
Working capital adjustment, net | $ 49,795 | |||||
Purchase price | 62,344 | |||||
Acquisition related costs | $ 2,591 | $ 179 | ||||
Net loss before tax | (23,559) | 25,698 | $ 16,934 | |||
Contingent payments description | The Contingent Payments related to tax refunds and customs duties and claims damages in the amount of no less than $11,420. | |||||
Goodwill acquired for deductible for tax purposes | 12,272 | |||||
Preliminary Allocation [Member] | ||||||
Aquisition of Mophie Inc. (Textual) | ||||||
Cash consideration | 100,000 | |||||
Working capital adjustment, gross | 23,478 | |||||
Purchase price | 87,805 | |||||
Adjustments to fair value of working capital | (11,283) | |||||
Adjustments to Working Capital and Fair Value [Member] | ||||||
Aquisition of Mophie Inc. (Textual) | ||||||
Additional working capital deficit | 26,317 | |||||
Adjustments to fair value of working capital | 856 | |||||
ZAGG Inc [Member] | ||||||
Aquisition of Mophie Inc. (Textual) | ||||||
Paid to principal shareholders in escrow account | 2,000 | |||||
Insurance policy amount | $ 10,000 | |||||
Additional working capital deficit | 26,317 | |||||
Loss on purchase price | 24,317 | |||||
Working capital, description | ZAGG has submitted to the Principal Shareholders a closing adjustment statement seeking the release to ZAGG of the $2,000 placed in escrow based on the portion of the overall net working capital deficit that ZAGG has determined to be recoverable under Section 2.16 of the Merger Agreement. Mr. Huang, as the Representative of the Shareholders, submitted a dispute notice in which he, on behalf of all Shareholders, disputed ZAGG's closing adjustment statement, asserted that there is no additional working capital deficit, and demanded release of the $2,000 escrow fund to the Principal Shareholders. The Company is continuing to pursue its claims related to the net working capital deficit, which efforts have required the Company to resort to the independent accountant dispute resolution mechanism provided in the Merger Agreement in order to obtain the $2,000 placed in escrow. | |||||
Mophie Inc [Member] | ||||||
Aquisition of Mophie Inc. (Textual) | ||||||
Acquisition date | Mar. 3, 2016 | |||||
Cash consideration | $ 100,000 | |||||
Merger agreement earn-out control | The Merger Agreement includes an earn-out provision whereby additional consideration could be paid based on whether mophie's 12-month Adjusted EBITDA (as defined in the Merger Agreement) from April 1, 2016 to March 31, 2017 (the "Earnout Period") exceeds $20,000, subject to certain tax adjustments as provided in the Merger Agreement. For every dollar in Adjusted EBITDA generated during the Earnout Period that exceeds $20,000, the Company will pay additional consideration at a five times multiple ("Earnout Consideration"), subject to certain tax adjustments as provided in the Merger Agreement, and the deposit of 10% of the Earnout Consideration into an indemnity escrow account. Any Earnout Consideration will initially be paid by the issuance of up to $5,000 in shares of the Company's common stock valued as of February 2, 2016 (the day prior to the public announcement of the definitive agreement on February 3, 2016). Based on mophie's Adjusted EBITDA (as defined in the Merger Agreement) from April 1, 2016 to December 31, 2016, the Company presently expects that the mophie shareholders will not be entitled to any Earnout Consideration. | |||||
Earn out consideration | $ 20,000 | |||||
Issuance of common stock value | $ 5,000 | |||||
Insurance policy amount | $ 2,000 | |||||
Net sales | 113,749 | |||||
Net loss before tax | 31,145 | |||||
Pro forma net loss amortization expense | 6,770 | 7,432 | ||||
Business acquisition pro forma information | 2,586 | |||||
Tax adjustment, percentage | 10.00% | |||||
Amortization of debt issuance cost | $ 1,753 | $ 1,924 | ||||
Working capital, description | The Company has commenced procedures to recover the amounts related to the aggregate net working capital deficit and losses from breaches of representations, warranties and covenants including (1) pursuing collection of the $2,000 escrow amount, (2) submitting claims under the $10,000 representation and warranty insurance policy put in place at the Acquisition Date, (3) pursuing any and all offset rights granted under the Merger Agreement with respect to the Contingent Payments that would have been paid to the Principal Shareholders and (4) pursuing litigation against Mr. Huang, the other mophie shareholders and others in Delaware and California for breaches of certain representations, warranties and covenants of mophie in the Merger Agreement that have resulted in damages exceeding $22,000. | |||||
Goodwill acquired for deductible for tax purposes | $ 160 |
Goodwill and Intangible Asset51
Goodwill and Intangible Assets (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | |
Increase due to acquisitions | 12,272 |
Ending Balance | $ 12,272 |
Goodwill and Intangible Asset52
Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 64,848 | $ 64,650 |
Acquisitions | 43,812 | 198 |
Accumulated Amortization | (55,298) | (41,803) |
Net Carrying Amount | $ 53,362 | $ 23,045 |
Weighted Average Amortization Period | 8 years 2 months 12 days | 8 years 4 months 24 days |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 41,500 | $ 41,500 |
Acquisitions | 8,200 | |
Accumulated Amortization | (35,088) | (29,150) |
Net Carrying Amount | $ 14,612 | $ 12,350 |
Weighted Average Amortization Period | 7 years 6 months | 8 years |
Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 12,921 | $ 12,921 |
Acquisitions | 18,348 | |
Accumulated Amortization | (9,763) | (6,253) |
Net Carrying Amount | $ 21,506 | $ 6,668 |
Weighted Average Amortization Period | 9 years 9 months 18 days | 9 years 6 months |
Patents and technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 6,003 | $ 5,805 |
Acquisitions | 15,225 | 198 |
Accumulated Amortization | (5,501) | (2,381) |
Net Carrying Amount | $ 15,727 | $ 3,622 |
Weighted Average Amortization Period | 8 years 9 months 18 days | 11 years 10 months 24 days |
Non-compete agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 4,100 | $ 4,100 |
Acquisitions | 1,796 | |
Accumulated Amortization | (4,399) | (3,729) |
Net Carrying Amount | $ 1,497 | $ 371 |
Weighted Average Amortization Period | 4 years 10 months 24 days | 4 years 9 months 18 days |
Other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 324 | $ 324 |
Acquisitions | 243 | |
Accumulated Amortization | (547) | (290) |
Net Carrying Amount | $ 20 | $ 34 |
Weighted Average Amortization Period | 2 years 4 months 24 days | 4 years 1 month 6 days |
Goodwill and Intangible Asset53
Goodwill and Intangible Assets (Details 2) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets [Abstract] | ||
2,017 | $ 12,387 | |
2,018 | 11,351 | |
2,019 | 9,267 | |
2,020 | 6,653 | |
2,021 | 4,148 | |
Thereafter | 9,556 | |
Total | $ 53,362 | $ 23,045 |
Goodwill and Intangible Asset54
Goodwill and Intangible Assets (Details Textual) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||
Increase in goodwill | $ 12,272 | ||
Amortization expenses | 13,385 | $ 8,453 | $ 9,709 |
Acquisitions | 43,812 | 198 | |
Consideration for acquisition of patent | $ 198 | ||
Common Stock | |||
Finite-Lived Intangible Assets [Line Items] | |||
Consideration for acquisition of patent (in shares) | 21 | ||
Acquired technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | 110 | $ 109 | 102 |
Remaining Definite Lived Intangible Asset [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expenses | $ 13,495 | $ 8,562 | $ 9,811 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes [Abstract] | |||
US Operations | $ (22,220) | $ 26,852 | $ 19,487 |
Foreign Operations | (1,339) | (1,154) | (2,553) |
Total | $ (23,559) | $ 25,698 | $ 16,934 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current benefit (provision): | |||
Federal | $ (89) | $ (9,429) | $ (9,705) |
State | 138 | (1,783) | (2,502) |
Foreign | (31) | (61) | (36) |
Total current | 18 | (11,273) | (12,243) |
Deferred benefit (provision): | |||
Federal | 7,612 | 973 | 4,144 |
State | 342 | 189 | 1,626 |
Foreign | |||
Total deferred | (7,972) | (1,162) | (5,770) |
Total benefit (provision) | $ 7,972 | $ (10,111) | $ (6,473) |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes [Abstract] | |||
Tax at statutory rate (35%) | $ 8,246 | $ (8,994) | $ (5,927) |
State tax, net of federal tax benefit | 1,041 | (1,089) | (955) |
Non-deductible expense and other | 333 | 116 | 220 |
Foreign tax rate differential | (491) | (464) | (900) |
Domestic production activities deduction | 459 | 688 | |
Return to provision adjustment | (36) | 126 | 453 |
Reserve related to unrecognized tax benefits | (452) | (264) | (541) |
Interest and penalties | (14) | (1) | (37) |
Effect of state rate changes, net of federal tax benefit | (655) | 526 | |
Total benefit (provision) | $ 7,972 | $ (10,111) | $ (6,473) |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 286 | $ 196 |
Deferred revenue | 27 | 7 |
Inventories | 12,724 | 5,581 |
Stock-based compensation | 1,857 | 2,406 |
Sales returns accrual | 7,788 | 2,974 |
Acquisition costs, net of amortization | 191 | 217 |
Intangible assets | 77 | 12,924 |
Goodwill | 1,663 | 1,886 |
HzO investment | 1,483 | 1,520 |
Capital loss carry-over | 271 | 278 |
Reserve on note receivable | 328 | 336 |
Net operating loss carryforward | 21,313 | |
Federal credit carryforwards | 2,816 | |
Other liabilities | 1,619 | 499 |
Deferred tax assets | 52,443 | 28,824 |
Valuation allowance | (1,753) | (1,798) |
Total deferred tax assets | 50,690 | 27,026 |
Deferred tax liabilities: | ||
Property and equipment | 323 | 800 |
Other | 4 | |
Total gross deferred tax liabilities | 327 | 800 |
Net deferred tax assets | 50,363 | 26,226 |
Deferred tax assets, net - current | 23,050 | 10,840 |
Deferred tax assets, net - noncurrent | 27,313 | 15,386 |
Net deferred tax assets | $ 50,363 | $ 26,226 |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Abstract] | ||
Unrecognized tax benefits, as of January 1 | $ 1,265 | $ 1,001 |
Unrecognized tax benefits assumed in acquisition | 513 | |
Gross increases - tax positions in current period | 452 | 264 |
Total benefit | $ 2,230 | $ 1,265 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2012 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Taxes Textual [Abstract] | ||||
Federal statutory rate | 35.00% | |||
Deferred tax assets, valuation allowance | $ 1,753 | $ 1,798 | ||
Change in valuation allowance | 271 | 278 | ||
Cash held by foreign entities permanently reinvested | 4,458 | |||
Tax contingency | 2,230 | 1,265 | ||
Unrecognized tax benefits | 2,230 | 1,265 | $ 1,001 | |
Unrecognized tax benefits that would impact effective tax rate | 2,081 | |||
Income Tax Interest and Penalties | $ 12 | 2 | 37 | |
Net operating loss and Federal credit carryforwards expire years | The net operating loss carryforwards will expire on various dates from 2034 through 2036. | |||
Federal net operating loss carryforwards | $ 57,000 | |||
State net operating loss carryforwards | 35,000 | |||
Increase in research and development | $ 231 | 231 | ||
Increase taxable income | $ 21 | $ 21 | ||
HzO, Inc | ||||
Income Taxes Textual [Abstract] | ||||
Deferred tax assets, valuation allowance | $ 1,483 | $ 1,520 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair value measurements recurring basis [Member] - Money market funds [Member] - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Estimate of Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | $ 5 | $ 375 |
Level 1 Inputs [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | 5 | 375 |
Level 2 Inputs [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | ||
Level 3 Inputs [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents |
Note Receivable (Details)
Note Receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Note Receivable [Abstract] | ||
Unpaid fee | $ 5,273 | $ 4,836 |
Increase in accured interest | $ 437 |
Debt and Letters of Credit (Det
Debt and Letters of Credit (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Short-term Debt [Line Items] | |
2,017 | $ 10,549 |
2,018 | 6,250 |
2,019 | 3,514 |
2,020 | |
2,021 | 31,307 |
Thereafter | |
Total | 51,620 |
Line of Credit [Member] | |
Short-term Debt [Line Items] | |
2,017 | |
2,018 | |
2,019 | |
2,020 | |
2,021 | 31,307 |
Thereafter | |
Total | 31,307 |
Term Loan [Member] | |
Short-term Debt [Line Items] | |
2,017 | 10,549 |
2,018 | 6,250 |
2,019 | 3,514 |
2,020 | |
2,021 | |
Thereafter | |
Total | $ 20,313 |
Debt and Letters of Credit (D64
Debt and Letters of Credit (Details Textual) - USD ($) $ in Thousands | Mar. 03, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Debt and Letters of Credit (Textual) | ||||
Unused line fees | $ 56 | $ 38 | ||
Weighted average interest rate on all outstanding borrowings | 2.21% | |||
Effective interest rate | 3.16% | |||
Line of credit fee Percentage | 2.21% | |||
Incurred and capitalization direct cost | $ 1,144 | |||
Line of credit facility, outstanding balance | 31,307 | |||
Prepayment amount | $ 4,299 | |||
Mandatory prepayment portion of term loans percentage | 25.00% | |||
Line of Credit [Member] | ||||
Debt and Letters of Credit (Textual) | ||||
Line of credit maturity date | Mar. 2, 2021 | |||
Revolving credit commitment | $ 85,000 | |||
Line of credit interest rate, description | Interest on the Line of Credit will accrue at the base rate plus 0.5% or LIBOR plus 1.5%. | |||
Line of credit fee Percentage | 0.20% | |||
Term Loan [Member] | ||||
Debt and Letters of Credit (Textual) | ||||
Line of credit facility, maximum borrowing capacity | $ 25,000 | |||
Line of credit maturity date | Mar. 2, 2020 | |||
Line of credit interest rate, description | Interest on the Term Loan will accrue at the base rate plus 1.0% or at a rate of LIBOR plus 2.0%. | |||
Line of credit facility principal payment | $ 521 | |||
Credit and Security Agreement [Member] | ||||
Debt and Letters of Credit (Textual) | ||||
Line of credit fee Percentage | 0.125% | |||
Incurred and capitalization direct cost | $ 1,144 | |||
Cost related to line of credit | 884 | |||
Cost related to long-term debt | 260 | |||
Amortization of capitalization costs | $ 202 |
Stock Options Warrants and Re65
Stock Options Warrants and Restricted Stock (Details) - Stock options [Member] $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2016USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Outstanding at December 31, 2015 | shares | 93 |
Exercised | shares | (93) |
Outstanding at December 31, 2016 | shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |
Outstanding at December 31, 2015 | $ / shares | $ 8.14 |
Exercised | $ / shares | 8.14 |
Outstanding at December 31, 2016 | $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Stock option outstanding, Weighted-Average Remaining Contractual Term | 2 months 12 days |
Stock option outstanding, Aggregate Intrinsic Value | $ | $ 259 |
Stock Options Warrants and Re66
Stock Options Warrants and Restricted Stock (Details 1) - Warrant [Member] $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($)$ / shares$ / Warrantshares | Dec. 31, 2015USD ($)$ / Warrantshares | |
Warrants Outstanding Rollforward [Abstract] | ||
Outstanding at December 31, 2015 | 78 | |
Exercised | (28) | |
Outstanding at December 31, 2016 | 50 | 78 |
Exercisable at December 31, 2016 | 50 | |
Class Of Warrant Or Right Outstanding Weighted Average Exercise Price Rollforward [Abstract] | ||
Outstanding at December 31, 2015 | $ / Warrant | 9.03 | |
Exercised | $ / shares | $ 9.05 | |
Outstanding at December 31, 2016 | $ / Warrant | 9.02 | 9.03 |
Exercisable at December 31, 2016 | $ / Warrant | 9.02 | |
Class Of Warrant Or Right Additional Disclosures [Abstract] | ||
Warrants Outstanding, Weighted-Average Remaining Contractual Term | 1 month 6 days | 8 months 12 days |
Warrants Exercisable, Weighted-Average Remaining Contractual Term | 1 month 6 days | |
Warrants Outstanding, Aggregate Intrinsic Value | $ | $ (96) | $ 148 |
Warrants Exercised, Aggregate Intrinsic Value | $ | ||
Warrants Exercisable, Aggregate Intrinsic Value | $ | $ (96) |
Stock Options Warrants and Re67
Stock Options Warrants and Restricted Stock (Details 2) - Restricted Stock [Member] shares in Thousands | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at December 31, 2015 | shares | 782 |
Granted | shares | 1,071 |
Vested | shares | (684) |
Forfeited | shares | (403) |
Outstanding at December 31, 2016 | shares | 766 |
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, 2015 | $ / shares | $ 6.47 |
Granted | $ / shares | 7.85 |
Vested | $ / shares | 6.33 |
Forfeited | $ / shares | 7.66 |
Outstanding at December 31, 2016 | $ / shares | $ 7.89 |
Stock Options Warrants and Re68
Stock Options Warrants and Restricted Stock (Details Textual) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Jan. 15, 2013 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Stock Options Warrants and Restricted Stock (Textual) | ||||
Intrinsic value of warrants exercised | $ 0 | $ 277 | $ 18 | |
Unrecognized estimated compensation cost related to nonvested warrants granted | 0 | |||
Total fair value of warrants vested | 0 | $ 0 | $ 33 | |
Total unrecognized compensation cost related to nonvested restricted stock awards granted | $ 3,530 | |||
Weighted-average period for recognition of compensation cost | 10 months 24 days | |||
Warrants [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Weighted-average grant-date fair value of options granted | $ 0 | $ 0 | $ 0 | |
Warrant related expenses | $ 0 | $ 0 | $ 0 | |
Selling, General and Administrative Expenses [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Equity-based compensation expense | 3,830 | 3,893 | 2,220 | |
Net tax benefit recognized on equity-based compensation expense | 1,465 | 1,489 | 785 | |
Amount of tax benefit realized from restricted stock | 2,119 | 1,014 | 378 | |
Selling, General and Administrative Expenses [Member] | Warrants [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Compensation expense related to warrants | 0 | 0 | 0 | |
Net tax benefit on equity-based compensation expense of warrants | 0 | 0 | 0 | |
Amount of tax benefit realized from compensatory warrants exercised | 0 | 69 | 9 | |
Stock options [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Unrecognized compensation cost related to nonvested stock options granted | 0 | |||
Fair value of shares vested during period | 0 | 0 | 154 | |
Net tax benefit recognized on equity-based compensation expense | 0 | 0 | 73 | |
Tax benefit realized from stock options exercised | 48 | 151 | 73 | |
Stock options [Member] | Common Stock | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Total intrinsic value of options exercised | 14 | 416 | 417 | |
Stock options [Member] | Selling, General and Administrative Expenses [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Equity-based compensation expense | 0 | 0 | 28 | |
Restricted stock [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Reduction to additional paid-in capital | $ 630 | $ 724 | $ 75 | |
2007 Plan [Member] | ||||
Stock Options Warrants and Restricted Stock (Textual) | ||||
Number of shares available for grant | 6,239 | |||
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 | 2,999 | |||
Term of the plan | 10 years |
Treasury Stock (Details Textual
Treasury Stock (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Treasury Stock (Textual) | ||||
Number of repurchase of shares authorized by board of directors | $ 20,000 | |||
Number of common stock repurchased under plan | 152,000 | 2,030,000 | 1,813,000 | |
Cash consideration paid for repurchase of common stock | $ 951 | $ 14,930 | $ 9,579 | |
Commissions paid to brokers | $ 6 | $ 61 | ||
Weighted average price per share of stock repurchase | $ 6.23 | $ 7.32 | ||
Foreclose price per share | $ 8.59 | |||
Foreclose shares of common stock | 80 | |||
Total value of foreclose shares of common stock | $ 688 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Defined Contribution Plan (Textual) | |||
Percentage of employees salary matches participant contributions | 100.00% | ||
Percentage of maximum employees salary | 5.00% | ||
Costs recognized related to employer | $ 941 | $ 335 | $ 414 |
Commitments and Contingencies71
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments and Contingencies [Abstract] | |
2,017 | $ 2,923 |
2,018 | 2,165 |
2,019 | 1,708 |
2,020 | 1,522 |
2,021 | 1,448 |
Thereafter | 2,556 |
Total | $ 12,322 |
Commitments and Contingencies72
Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Dec. 16, 2016 | Oct. 21, 2016 | Oct. 29, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Loss Contingencies [Line Items] | ||||||
Rental payment of leases | $ 3,190 | $ 1,642 | $ 1,640 | |||
Acquisition costs | 1,959 | |||||
Contingent payments description | The Contingent Payments related to tax refunds and customs duties and claims damages in the amount of no less than $11,420. | |||||
Complaint against the company | Peter Kravitz v. ZAGG Inc., U.S. Bankruptcy Court, District of Delaware, Adv. Pro. No. 15-51558(BLS). On October 29, 2015, Kravitz, as Liquidating Trustee (the "Trustee") of the RSH Liquidating Trust (formerly known as RadioShack) filed a complaint against the Company, alleging, among other things, that the Company received preference payments for product the Company sold and delivered to RadioShack in the amount of $1,834 pursuant to Section 547 of the Bankruptcy Code | |||||
Damages exceeding value | $ 22,000 | |||||
Sublease Income [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Rental payment of leases | $ 0 | $ 0 | $ 910 |
Concentrations (Details)
Concentrations (Details) - Customer Concentration Risk [Member] | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounts Receivable [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | 10.00% | |
Accounts Receivable [Member] | Superior [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 32.00% | 31.00% | |
Accounts Receivable [Member] | Best Buy [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 22.00% | 29.00% | |
Accounts Receivable [Member] | GENCO [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | 5.00% | |
Sales Revenue, Net [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 10.00% | 10.00% | 10.00% |
Sales Revenue, Net [Member] | Superior [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 27.00% | 17.00% | 6.00% |
Sales Revenue, Net [Member] | Best Buy [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 11.00% | 20.00% | 30.00% |
Sales Revenue, Net [Member] | GENCO [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk percentage | 11.00% | 11.00% | 11.00% |
Concentrations (Details 1)
Concentrations (Details 1) - Sales revenue [Member] | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
United States [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 88.00% | 91.00% | 90.00% |
Europe [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 7.00% | 8.00% | 7.00% |
Other [Member] | |||
Concentration Risk [Line Items] | |||
Percentage of sales | 5.00% | 1.00% | 3.00% |
Concentrations (Details Textual
Concentrations (Details Textual) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016USD ($)Customer | Dec. 31, 2015USD ($)Customer | Dec. 31, 2014Customer | |
International Locations [Member] | |||
Concentrations (Textual) | |||
Net assets located overseas | $ | $ 16,588 | $ 8,387 | |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | |||
Concentrations (Textual) | |||
Percentage of sales | 10.00% | 10.00% | |
Number of customer | 3 | 2 | |
Accounts revenues in percentage of all customers | No other customer account balances were more than 10 | No other customer account balances were more than 10 | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | |||
Concentrations (Textual) | |||
Percentage of sales | 10.00% | 10.00% | 10.00% |
Number of customer | 1 | ||
Accounts revenues in percentage of all customers | No other customers accounted for greater than 10% of net sales. | No other customers accounted for greater than 10% of net sales. | One other customer accounted for greater than 10% of net sales. |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule of segment reporting information [Abstract] | |||||||||||
Net sales | $ 114,930 | $ 124,662 | $ 99,833 | $ 62,432 | $ 78,632 | $ 66,774 | $ 66,689 | $ 57,216 | $ 401,857 | $ 269,311 | $ 261,585 |
Gross profit | 127,602 | 101,684 | 83,344 | ||||||||
Income (loss) from operations | (3,595) | $ (12,710) | $ (1,352) | $ (3,703) | 7,944 | $ 6,228 | $ 6,253 | $ 5,439 | (21,360) | 25,864 | $ 16,983 |
Total assets | 310,729 | 179,541 | 310,729 | 179,541 | |||||||
ZAGG segment [Member] | |||||||||||
Schedule of segment reporting information [Abstract] | |||||||||||
Net sales | 288,108 | 269,311 | |||||||||
Gross profit | 115,123 | 101,684 | |||||||||
Income (loss) from operations | 9,817 | 25,864 | |||||||||
Total assets | 156,123 | 179,541 | 156,123 | 179,541 | |||||||
mophie segment [Member] | |||||||||||
Schedule of segment reporting information [Abstract] | |||||||||||
Net sales | 113,749 | ||||||||||
Gross profit | 12,479 | ||||||||||
Income (loss) from operations | (31,177) | ||||||||||
Total assets | $ 154,606 | $ 154,606 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) | 12 Months Ended |
Dec. 31, 2016Segment | |
Segment Reporting (Textual) | |
Number of operating segments | 2 |
Quarterly Financial Data (Una78
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||
Quarterly Financial Data [Abstract] | |||||||||||||||||||
Net sales | $ 114,930 | $ 124,662 | $ 99,833 | $ 62,432 | $ 78,632 | $ 66,774 | $ 66,689 | $ 57,216 | $ 401,857 | $ 269,311 | $ 261,585 | ||||||||
Loss from operations | (3,595) | (12,710) | (1,352) | (3,703) | 7,944 | 6,228 | 6,253 | 5,439 | (21,360) | 25,864 | 16,983 | ||||||||
Net (loss) income | $ (4,146) | $ (7,105) | $ (1,046) | $ (3,290) | $ 4,957 | $ 3,739 | $ 3,691 | $ 3,200 | $ (15,587) | $ 15,587 | $ 10,461 | ||||||||
Earnings (loss) per share: (1) | |||||||||||||||||||
Basic | $ (0.15) | [1] | $ (0.25) | [1] | $ (0.04) | [1] | $ (0.12) | [1] | $ 0.18 | [1] | $ 0.13 | [1] | $ 0.13 | [1] | $ 0.11 | [1] | $ (0.56) | $ 0.54 | $ 0.35 |
Diluted | $ (0.15) | [1] | $ (0.25) | [1] | $ (0.04) | [1] | $ (0.12) | [1] | $ 0.18 | [1] | $ 0.13 | [1] | $ 0.12 | [1] | $ 0.11 | [1] | $ (0.56) | $ 0.54 | $ 0.34 |
Weighted average common shares: | |||||||||||||||||||
Basic | 28,061 | 28,125 | 28,126 | 27,710 | 27,483 | 28,734 | 29,521 | 29,380 | 28,006 | 28,773 | 30,247 | ||||||||
Diluted | 28,061 | 28,125 | 28,126 | 27,710 | 28,022 | 28,930 | 29,754 | 29,678 | 28,006 | 29,089 | 30,610 | ||||||||
[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. |