Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 01, 2017 | |
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-Q | |
Document Period End Date | Jun. 30, 2017 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 27,964,610 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 14,330 | $ 11,604 |
Accounts receivable, net of allowances of $784 in 2017 and $824 in 2016 | 72,956 | 83,835 |
Inventories | 65,376 | 72,769 |
Prepaid expenses and other current assets | 3,717 | 3,414 |
Income tax receivable | 1,193 | 2,814 |
Total current assets | 157,572 | 174,436 |
Property and equipment, net of accumulated depreciation of $21,856 in 2017 and $18,371 in 2016 | 15,631 | 17,755 |
Goodwill | 12,272 | 12,272 |
Intangible assets, net of accumulated amortization of $60,555 in 2017 and $55,298 in 2016 | 45,327 | 53,362 |
Deferred income tax assets | 49,331 | 50,363 |
Other assets | 1,541 | 2,541 |
Total assets | 281,674 | 310,729 |
Current liabilities: | ||
Accounts payable | 62,237 | 85,022 |
Accrued liabilities | 22,798 | 22,216 |
Sales returns liability | 27,794 | 28,373 |
Accrued wages and wage related expenses | 5,635 | 6,169 |
Deferred revenue | 209 | 273 |
Line of credit | 30,683 | 31,307 |
Current portion of long-term debt, net of deferred loan costs of $65 in 2017 and 2016 | 6,185 | 10,484 |
Total current liabilities | 155,541 | 183,844 |
Noncurrent portion of long-term debt, net of deferred loan costs of $108 in 2017 and $141 in 2016 | 10,829 | 9,623 |
Total liabilities | 166,370 | 193,467 |
Stockholders' equity: | ||
Common stock, $0.001 par value; 100,000 shares authorized; 34,047 and 33,840 shares issued in 2017 and 2016, respectively | 34 | 34 |
Additional paid-in capital | 94,207 | 92,782 |
Accumulated other comprehensive loss | (1,270) | (2,114) |
Treasury stock, 6,065 and 5,831 common shares in 2017 and 2016 respectively, at cost | (37,637) | (36,145) |
Retained earnings | 59,970 | 62,705 |
Total stockholders' equity | 115,304 | 117,262 |
Total liabilities and stockholders' equity | $ 281,674 | $ 310,729 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($) shares in Thousands, $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Balance Sheets [Abstract] | ||
Allowances for doubtful accounts | $ 784 | $ 824 |
Accumulated depreciation on property and equipment | 21,856 | 18,371 |
Accumulated amortization on intangible assets | 60,555 | 55,298 |
Deferred loan costs, current | 65 | 65 |
Deferred loan costs, noncurrent | $ 108 | $ 141 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 34,047 | 33,840 |
Treasury stock, common shares | 6,065 | 5,831 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Operations [Abstract] | ||||
Net sales | $ 115,227 | $ 99,833 | $ 208,173 | $ 162,266 |
Cost of sales | 79,403 | 68,960 | 143,743 | 107,664 |
Gross profit | 35,824 | 30,873 | 64,430 | 54,602 |
Operating expenses: | ||||
Advertising and marketing | 2,070 | 2,275 | 5,076 | 5,189 |
Selling, general and administrative | 24,952 | 24,880 | 52,006 | 44,635 |
Transaction costs | 300 | 305 | 515 | 2,322 |
Impairment of intangible asset | 1,959 | |||
Amortization of long-lived intangibles | 3,005 | 4,765 | 6,026 | 7,511 |
Total operating expenses | 30,327 | 32,225 | 65,582 | 59,657 |
Income (loss) from operations | 5,497 | (1,352) | (1,152) | (5,055) |
Other income (expense): | ||||
Interest expense | (619) | (604) | (1,110) | (792) |
Other income (expense) | 67 | 9 | 48 | (191) |
Total other expense | (552) | (595) | (1,062) | (983) |
Income (loss) before provision for income taxes | 4,945 | (1,947) | (2,214) | (6,038) |
Income tax benefit (provision) | (1,542) | 901 | (521) | 1,703 |
Net income (loss) | $ 3,403 | $ (1,046) | $ (2,735) | $ (4,335) |
Earnings (Loss) per share: | ||||
Basic earnings (loss) per share | $ 0.12 | $ (0.04) | $ (0.10) | $ (0.16) |
Diluted earnings (loss) per share | $ 0.12 | $ (0.04) | $ (0.10) | $ (0.16) |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 3,403 | $ (1,046) | $ (2,735) | $ (4,335) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation (loss) gain | 556 | (284) | 844 | 35 |
Total other comprehensive income (loss) | 556 | (284) | 844 | 35 |
Comprehensive income (loss) | $ 3,959 | $ (1,330) | $ (1,891) | $ (4,300) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Cash flows from operating activities | ||
Net loss | $ (2,735) | $ (4,335) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock-based compensation | 1,636 | 2,291 |
Excess tax benefits related to share-based payments | (566) | |
Depreciation and amortization | 11,022 | 14,568 |
Loss on disposal of property and equipment | 13 | |
Deferred income taxes | 1,040 | (43) |
Amortization of deferred loan costs | 120 | 81 |
Impairment of intangible asset | 1,959 | |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable, net | 11,350 | 5,666 |
Inventories | 8,130 | 1,104 |
Prepaid expenses and other current assets | (298) | 1,859 |
Other assets | 912 | (210) |
Income taxes receivable | 1,622 | (1,095) |
Accounts payable | (23,116) | (8,506) |
Accrued liabilities | 1,073 | (202) |
Accrued wages and wage related expenses | (1,083) | 12 |
Deferred revenue | (64) | 69 |
Sales returns liability | (625) | (7,274) |
Net cash provided by operating activities | 10,956 | 3,419 |
Cash flows from investing activities | ||
Purchase of property and equipment (net of amounts acquired) | (3,065) | (4,700) |
Proceeds from disposal of equipment | 31 | |
Purchase of mophie, net of cash acquired | (74,743) | |
Net cash used in investing activities | (3,034) | (79,443) |
Cash flows from financing activities | ||
Payment of debt issuance costs | (1,144) | |
Proceeds from revolving credit facility | 205,897 | 142,477 |
Payments on revolving credit facility | (206,521) | (92,471) |
Proceeds from term loan facility | 25,000 | |
Payments on term loan facility | (3,125) | (1,563) |
Purchase of treasury stock | (1,492) | |
Payment of withholdings on restricted stock units | (240) | (621) |
Proceeds from exercise of warrants and options | 29 | 54 |
Excess tax benefits related to share-based payments | 566 | |
Net cash provided by (used in) financing activities | (5,452) | 72,298 |
Effect of foreign currency exchange rates on cash equivalents | 256 | (26) |
Net increase (decrease) in cash and cash equivalents | 2,726 | (3,752) |
Cash and cash equivalents at beginning of the period | 11,604 | 13,002 |
Cash and cash equivalents at end of the period | 14,330 | 9,250 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 953 | 566 |
Cash paid (refunded) during the period for taxes, net | (2,322) | 834 |
Supplemental schedule of noncash investing and financing activities | ||
Purchase of fixed assets financed through accounts payable | $ 560 | $ 1,234 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 6 Months Ended |
Jun. 30, 2017 | |
Nature of Operations and Basis of Presentation [Abstract] | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | (1) NATURE OF OPERATIONS AND BASIS OF PRESENTATION 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, and cases sold under the ZAGG, InvisibleShield®, mophie®, and IFROGZ® brands. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) that, in the opinion of management, are necessary to present fairly the financial position, the results of operations, and cash flows of the Company for the periods presented. The Company suggests that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s 2016 Annual Report on Form 10-K. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of condensed consolidated financial statements in conformity with U.S. 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 condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On March 3, 2016, the Company acquired mophie inc. ("mophie"). 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 3 and 13 for additional details on the acquisition and the Company's reportable segments. The condensed 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; ZAGG Netherlands B.V.; ZAGG Mobile Accessories Australia Pty Ltd; 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. Significant Accounting Policies The Company’s significant accounting policies are described in Note 1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. Recent Accounting Pronouncements (amounts in thousands) 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 using the modified retrospective approach 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 and 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 has concluded that this ASU did not have a material 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. During the year ended December 31, 2016, the Company adopted the ASU using the retrospective approach resulting in recording deferred tax assets as non-current for current and prior periods presented. This adoption does not impact our results of operations. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”, 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 business entities 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. The new standard contains several amendments that simplify the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The changes in the new standard eliminate the accounting for excess tax benefits to be recognized in additional paid-in capital and tax deficiencies recognized either in the income tax provision or in additional paid-in capital. The Company has adopted ASU 2016-09 as of the beginning of the quarter ended March 31, 2017. During the quarter ended March 31, 2017, the Company applied the amendment relating to the recognition of excess tax benefits and deficiencies on a prospective basis and, accordingly, has recognized all excess tax benefits and tax deficiencies as income tax expense or benefit as discrete items resulting in the recognition of income tax expense of $171 for the six months ended June 30, 2017. The Company has not recorded a cumulative-effect adjustment to retained earnings as of the beginning of the year because all tax benefits had previously been recognized when the tax deductions related to stock compensation were utilized to reduce taxes payable. The Company has elected to apply the amendment related to the presentation of cash flows for excess tax benefits on a prospective basis and no prior periods have been adjusted. The Company’s financial position or results of operations were not impacted by amendments related to the statutory tax withholding requirement and, accordingly, no adjustment has been recorded. The Company will continue to classify cash remitted to the tax authorities as a financing activity as now required by the amendments in the ASU. The ASU permits a policy election to either record forfeitures as they occur or estimate forfeitures consistent with historical U.S. GAAP. The Company has elected to record forfeitures as they occur, which did not have a material impact on our financial position or results of operations. 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 business entities 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. 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. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2019. All entities may early adopt the standard for goodwill impairment tests with measurement dates after January 1, 2017. The Company performs an annual goodwill impairment assessment and will elect to early adopt this standard in the current year when the assessment is performed. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718),” which clarifies what constitutes a modification of a share-based payment award. This ASU is effective for all entities for annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2017 | |
Inventories [Abstract] | |
INVENTORIES | (2) INVENTORIES At June 30, 2017, and December 31, 2016, inventories consisted of the following: June 30, December 31, 2016 Finished goods $ 65,084 $ 72,490 Raw materials 292 279 Total inventories $ 65,376 $ 72,769 Included in prepaid expenses and other current assets were inventory deposits with third-party manufacturers at June 30, 2017 and December 31, 2016 of $957 and $437, respectively. |
Acquisition of Mophie Inc.
Acquisition of Mophie Inc. | 6 Months Ended |
Jun. 30, 2017 | |
Acquisition of Mophie Inc. [Abstract] | |
ACQUISITION OF MOPHIE INC. | (3) 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. 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 period March 3, 2016, through June 30, 2016, mophie generated net sales of $39,659 and a net loss before tax of $13,727. Pro forma Results from Operations The following unaudited pro-forma results of operations for the six months ended June 30, 2016 give pro forma effect as if the acquisition had occurred at the beginning of the period presented, 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 values at the date of purchase. Six months ended June 30, Net sales $ 179,592 Net loss $ (7,155 ) Basic loss per share $ (0.25 ) Diluted loss per share $ (0.25 ) 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 for the dates indicated. 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 six months ended June 30, 2016, pro forma net loss includes projected amortization expense of $4,412. In addition, the Company included interest from the new credit facility and amortization of debt issuance costs for the six months ended June 30, 2016 of $1,007. Material non-recurring adjustments excluded from the pro forma financial information above consists of the $6,937 step up of mophie inventory to its fair value, which was 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 | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | (4) GOODWILL AND INTANGIBLE ASSETS Goodwill There were no additions to nor impairment of goodwill for the quarter-ended June 30, 2017. The balance of goodwill as of June 30, 2017 was $12,272. Long-lived Intangible Assets The following table summarizes the changes in gross long-lived intangible assets: Gross balance at December 31, 2016 $ 108,659 Impairment loss on patent (2,777 ) Gross balance at June 30, 2017 $ 105,882 On April 11, 2017, the Company received a final court order stating that the claims of one of its patents were either unpatentable or cancelled. Accordingly, management determined that the patent’s carrying value was not recoverable through future cash flows and was impaired as of March 31, 2017. Consequently, for the six months period ended June 30, 2017, the Company recorded an impairment loss consisting of a reduction of gross carrying amount of $2,777, accumulated amortization of $818, and net carrying value of $1,959 to reduce the net carrying value of the cancelled patent to $0. Long-lived intangible assets, net of amortization as of June 30, 2017 and December 31, 2016, were as follows: June 30, December 31, Customer relationships $ 11,935 $ 14,612 Tradenames 19,680 21,506 Patents and technology 12,377 15,727 Non-compete agreements 1,317 1,497 Other 18 20 Total amortizable intangible assets $ 45,327 $ 53,362 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2017 | |
Income Taxes [Abstract] | |
INCOME TAXES | (5) INCOME TAXES For interim periods, the tax provision is determined utilizing an estimate of the Company’s annual effective tax rate adjusted for discrete items, if any. The Company’s effective tax rate for the three months ended June 30, 2017 and 2016, was 31.2% and 46.3%, respectively. The Company’s effective tax for the six months ended June 30, 2017 and 2016, was (23.5%) and 28.2%, respectively. The change in the effective tax rate for the three-month period ended June 30, 2017 was primarily due to income in lower rate foreign jurisdictions in which the company has losses in the prior year. The change in the effective tax rate for the six months ended June 30, 2017, was primarily due to a discrete expense recognized during the period related to the true up of a deferred amount for stock compensation and close to break-even pre-tax book loss in the current year. The Company’s effective tax rate will generally differ from the U.S. Federal statutory rate of 35%, due to state taxes, permanent items, and the Company’s global tax strategy. |
Fair Value Measures
Fair Value Measures | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Measures [Abstract] | |
FAIR VALUE MEASURES | (6) FAIR VALUE MEASURES Fair Value of Financial Instruments At June 30, 2017, the Company’s financial instruments included cash and cash equivalents, accounts receivable, accounts payable, a line of credit, and a term loan. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximates fair value due to the short-term maturities of these financial instruments. The carrying value of the debt balances approximate fair value because the variable interest rates reflect current market rates. 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 Company to develop its own assumptions. At June 30, 2017, and December 31, 2016, the following assets were measured at fair value on a recurring basis using the level of inputs shown: Fair Value Measurements Using: June 30, Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — Fair Value Measurements Using: December 31, Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — |
Debt and Line of Credit
Debt and Line of Credit | 6 Months Ended |
Jun. 30, 2017 | |
Debt and Line of Credit [Abstract] | |
DEBT AND LINE OF CREDIT | (7) DEBT AND LINE OF CREDIT Long-term debt, net as of June 30, 2017 and December 31, 2016, was as follows: June 30, December 31, 2016 Line of credit $ 30,683 $ 31,307 Term loan 17,014 20,107 Total debt outstanding 47,697 51,514 Less current portion 36,868 41,791 Total long-term debt outstanding $ 10,829 $ 9,623 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2017 | |
Stock-Based Compensation [Abstract] | |
STOCK-BASED COMPENSATION | (8) STOCK-BASED COMPENSATION During the three and six months ended June 30, 2017, the Company granted 123 and 434 restricted stock units, respectively. During the three and six months ended June 30, 2016, the Company granted 380 and 713 restricted stock units, respectively. The restricted stock units granted during the three and six months ended June 30, 2017 were estimated to have a weighted-average fair value per share of $6.35 and $6.57, respectively. The restricted stock units granted during the three and six months ended June 30, 2016 were estimated to have a weighted-average fair value per share of $5.40 and $7.33, respectively. The fair value of the restricted stock units granted is based on the closing share price of the Company’s common stock on the date of grant. The restricted stock units vest annually on a straight-line basis over a nine-month (annual board of directors’ grant) to three-year vesting term, depending on the terms of the individual grant. As part of the 434 and 713 grants discussed above, during the first six months of 2017 and 2016, the Company granted 372 and 418 restricted stock units, respectively, to certain executives and employees of the Company where vesting is linked to specific performance criterion. The restricted stock units granted in 2017 and 2016 only vest upon the Company’s achievement of specified thresholds of net sales, Adjusted EBITDA, or specific goals for the individual executive. As of June 30, 2017, the Company believes it is probable that it will achieve the targets for all restricted stock units granted in the first six months of 2017. Of the 418 restricted stock units granted in 2016, 29 shares vested and 150 shares were forfeited, and 239 have not yet vested or been forfeited. The estimated fair value of the restricted stock units 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 three and six months ended June 30, 2017, the Company recorded stock-based compensation expense related to restricted stock units of $966 and $1,636, respectively, which is included as a component of selling, general, and administrative expense. During the three and six months ended June 30, 2016, the Company recorded stock-based compensation expense related to restricted stock units of $957 and $2,291, respectively, which is included as a component of selling, general, and administrative expense During the six months ended June 30, 2017 and 2016, certain ZAGG employees elected to receive a net amount of shares upon the vesting of restricted stock unit grants in exchange for the Company paying up to the maximum statutory withholding amount of the employees’ tax liabilities for the fair value of the award on the vesting date. This resulted in the Company paying $240 and $621, respectively, which is reflected as a reduction of additional paid-in capital. We also recognized an increase of additional paid-in capital related to the employee stock purchase plan of $29 for the six months ended June 30, 2017. There was an immaterial impact to additional paid-in capital related to the employee stock purchase plan for the six months ended June 30, 2016. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings (Loss) Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | (9) EARNINGS (LOSS) PER SHARE Basic earnings (loss) per common share excludes dilution and is computed by dividing net earnings (loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings (loss) per common share reflects the potential dilution that could occur if stock options and restricted stock, 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 (loss) per share and diluted earnings (loss) per share for the three and six months ended June 30, 2017 and 2016: Three months ended June 30, June 30, Net income (loss) $ 3,403 $ (1,046 ) Weighted average shares outstanding: Basic 27,963 28,126 Dilutive effect of restricted stock units and warrants 250 --- Diluted 28,213 28,126 Earnings (loss) per share: Basic $ 0.12 $ (0.04 ) Diluted $ 0.12 $ (0.04 ) Six months ended June 30, June 30, Net loss $ (2,735 ) $ (4,335 ) Weighted average shares outstanding: Basic 28,010 27,918 Dilutive effect of restricted stock units and warrants — — Diluted 28,010 27,918 Earnings (loss) per share: Basic $ (0.10 ) $ (0.16 ) Diluted $ (0.10 ) $ (0.16 ) For the three months ended June 30, 2017, there were no warrants or restricted stock units excluded from the calculation of diluted earnings per share. For the three months ended June 30, 2016, warrants and restricted stock units to purchase shares of common stock totaling 895 were not considered in calculating the diluted earnings per share as their effect would have been anti-dilutive. For the six months ended June 30, 2017 and 2016, warrants and restricted stock units to purchase shares of common stock totaling 980 and 895, respectively, were not considered in calculating diluted earnings per share as their effect would have been anti-dilutive. |
Treasury Stock
Treasury Stock | 6 Months Ended |
Jun. 30, 2017 | |
Treasury Stock [Abstract] | |
TREASURY STOCK | (10) TREASURY STOCK For the three and six months ended June 30 For the three and six months ended June 30, 2016, no purchases of treasury stock occurred. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | (11) 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 June 30, 2017 were as follows: Remaining 2017 $ 1,457 2018 2,177 2019 1,714 2020 1,529 2021 1,455 Thereafter 2,584 Total $ 10,916 For the three months ended June 30, 2017 and 2016, rent expense was $758 and $939, respectively, and was included in selling, general and administrative expense in the condensed consolidated statement of operations. Rent expense is recognized on a basis which approximates straight-line over the lease term and was recorded as a component of selling, general and administrative expense on the condensed consolidated statement of operations. For the six months ended June 30, 2017 and 2016, rent expense was $1,443 and $1,656, respectively, and was included in selling, general and administrative expense in the condensed consolidated statement of operations. Rent expense is recognized on a basis which approximates straight-line over the lease term and was recorded as a component of selling, general and administrative expense on the condensed consolidated statement of operations. Commercial Litigation Daniel Huang, individually and as shareholder representative v. ZAGG Inc ZAGG Inc et al. v. Daniel Huang et al. 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. 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 fact that such pledges and sales were not disclosed in the Company’s 2011 10-K filed on March 15, 2012, or 2012 Proxy filed on April 27, 2012. 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 probable loss for known matters would not be material to the Company’s financial condition, the outcome of these actions is inherently difficult to predict. In the event of an adverse outcome, the ultimate potential loss could have a material adverse effect on the Company’s financial condition or results of operations in a particular period. The Company establishes reserves when a particular contingency is probable and estimable. Other than those discussed above, the Company has not accrued for any loss at June 30, 2017, in the condensed 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 | 6 Months Ended |
Jun. 30, 2017 | |
Concentrations [Abstract] | |
CONCENTRATIONS | (12) 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 June 30, 2017. At June 30, 2017, the balance of accounts receivable from two separate customers exceeded 10%: Superior Communications, Inc. (“Superior”) and Best Buy Co., Inc. (“Best Buy”). GENCO Distribution Systems, Inc. (“GENCO”) exceeded 10% of accounts receivable as of December 31, 2016, but not as of June 30, 2017. At June 30, 2017, the balance of accounts receivable from two separate customers exceeded 10%: June 30, December 31, 2016 Superior 38 % 32 % Best Buy 14 % 22 % GENCO 8 % 10 % No other customer account balances were more than 10% of accounts receivable at June 30, 2017, or December 31, 2016. 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 suppliers 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 net sales For the three months ended June 30, 2017 and 2016, Superior was our largest customer which accounted for over 10% of net sales; GENCO also accounted for over 10% of net sales for the three months ended June 30, 2016, as follows: Three months ended June 30, Three months ended June 30, Superior 31 % 27 % GENCO 8 % 12 % For the six months ended June 30, 2017 and 2016, Superior and GENCO were our largest customers with each accounting for over 10% of net sales; Best Buy also accounted for over 10% of net sales for the six months ended June 30, 2016, as follows: Six months ended June 30, Six months ended June 30, Superior 29 % 24 % GENCO 10 % 11 % Best Buy 8 % 10 % During 2017 and 2016 no other customers accounted for greater than 10% of net sales. 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 net sales by geographic region for the three months ended June 30, 2017 and 2016, was approximately: 2017 2016 United States 87 % 90 % Europe 8 % 6 % Other 5 % 4 % The percentage of net sales by geographic region for the six months ended June 30, 2017 and 2016, was approximately: 2017 2016 United States 86 % 89 % Europe 8 % 7 % Other 6 % 4 % |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | (13) 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, while international operations are directed from Shannon, Ireland. 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 were as follows: Three months ended June 30, Three months ended June 30, ZAGG segment $ 74,259 $ 67,810 mophie segment 40,968 32,023 Net sales $ 115,227 $ 99,833 Six months ended June 30, Six months ended June 30, ZAGG segment $ 131,424 $ 122,607 mophie segment 76,749 39,659 Net sales $ 208,173 $ 162,266 Gross profit by segment were as follows: Three months ended June 30, Three months ended June 30, ZAGG segment $ 27,790 $ 26,645 mophie segment 8,034 4,228 Gross profit $ 35,824 $ 30,873 Six months ended June 30, Six months ended June 30, ZAGG segment $ 52,093 $ 49,465 mophie segment 12,337 5,137 Gross profit $ 64,430 $ 54,602 Income (loss) from operations by segment were as follows: Three months ended Three months ended ZAGG segment $ 9,177 $ 8,288 mophie segment (3,680 ) (9,640 ) Income (loss) from operations $ 5,497 $ (1,352 ) Six months ended June 30, Six months ended June 30, ZAGG segment $ 10,216 $ 8,701 mophie segment (11,368 ) (13,756 ) Loss from operations $ (1,152 ) $ (5,055 ) Total assets by segment were as follows: June 30, December 31, ZAGG segment $ 141,192 $ 156,123 mophie segment 140,482 154,606 Total assets $ 281,674 $ 310,729 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | (14) SUBSEQUENT EVENTS On July 17, 2017, ZAGG Inc, KeyBank National Association (“KeyBank”), ZB, N.A. dba Zions First National Bank (“Zions Bank”), and JPMorgan Chase Bank, N.A. (collectively, the “Lenders”), and KeyBank, as the administrative agent for the Lenders, entered into a Third Amendment Agreement (“Amendment”), which amends the original Credit and Security Agreement dated as of March 3, 2016 by and among the Company, KeyBank, KeyBanc Capital Markets Inc., Zions Bank, and the other lenders party thereto, as amended by that certain First Amendment Agreement dated as of May 31, 2016 and that certain Second Amendment Agreement dated as of March 8, 2017 (collectively, the “Credit Agreement”), to: ● Increase the Maximum Revolving Amount, as defined in the Credit Agreement, from $85,000 to: ○ $135,000 from July 17, 2017 to December 31, 2017; ○ $110,000 million from January 1, 2018 to May 31, 2018; and ○ $100,000 from June 1, 2018 forward. ● Expand Permitted Foreign Subsidiary Loans, Guaranties and Investments, as defined in the Credit Agreement, to include: ○ A $2,000 loan dated April 5, 2017 from the Company to ZAGG International Distribution Limited; and ○ Any other loan or investment by the Company or any domestic subsidiary of the Company in or to, or guaranty of indebtedness of, any foreign subsidiary of the Company for the period July 17, 2017 to March 31, 2018, in an aggregate amount not to exceed $8,000. ● Increase the Letter of Credit Commitment, as defined in the Credit Agreement, from $7,500 to an aggregate amount of $40,000. ● Increase the Borrowing Base, as defined in the Credit Agreement, on a seasonal basis between August 1, 2017 and September 30, 2017 by $15,000. In connection with the Amendment, the Company also entered into replacement revolving credit notes with each of the Lenders. As consideration for entering into the Amendment, the Company agreed to pay the administrative agent and Lenders total amendment and arrangement fees of $145, pursuant to the terms of an administrative agent fee letter and a closing fee letter entered into with KeyBank. The changes to the Credit Agreement described above were made to support core-business opportunities. |
Nature of Operations and Basi21
Nature of Operations and Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Nature of Operations and Basis of Presentation [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies The Company’s significant accounting policies are described in Note 1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. |
Recent Accounting Pronouncements (amounts in thousands) | Recent Accounting Pronouncements (amounts in thousands) 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 using the modified retrospective approach 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 and 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 has concluded that this ASU did not have a material 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. During the year ended December 31, 2016, the Company adopted the ASU using the retrospective approach resulting in recording deferred tax assets as non-current for current and prior periods presented. This adoption does not impact our results of operations. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)”, 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 business entities 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. The new standard contains several amendments that simplify the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The changes in the new standard eliminate the accounting for excess tax benefits to be recognized in additional paid-in capital and tax deficiencies recognized either in the income tax provision or in additional paid-in capital. The Company has adopted ASU 2016-09 as of the beginning of the quarter ended March 31, 2017. During the quarter ended March 31, 2017, the Company applied the amendment relating to the recognition of excess tax benefits and deficiencies on a prospective basis and, accordingly, has recognized all excess tax benefits and tax deficiencies as income tax expense or benefit as discrete items resulting in the recognition of income tax expense of $171 for the six months ended June 30, 2017. The Company has not recorded a cumulative-effect adjustment to retained earnings as of the beginning of the year because all tax benefits had previously been recognized when the tax deductions related to stock compensation were utilized to reduce taxes payable. The Company has elected to apply the amendment related to the presentation of cash flows for excess tax benefits on a prospective basis and no prior periods have been adjusted. The Company’s financial position or results of operations were not impacted by amendments related to the statutory tax withholding requirement and, accordingly, no adjustment has been recorded. The Company will continue to classify cash remitted to the tax authorities as a financing activity as now required by the amendments in the ASU. The ASU permits a policy election to either record forfeitures as they occur or estimate forfeitures consistent with historical U.S. GAAP. The Company has elected to record forfeitures as they occur, which did not have a material impact on our financial position or results of operations. 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 business entities 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. 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. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which requires an entity to no longer perform a hypothetical purchase price allocation to measure goodwill impairment. Instead, impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit. The ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2019. All entities may early adopt the standard for goodwill impairment tests with measurement dates after January 1, 2017. The Company performs an annual goodwill impairment assessment and will elect to early adopt this standard in the current year when the assessment is performed. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation (Topic 718),” which clarifies what constitutes a modification of a share-based payment award. This ASU is effective for all entities for annual and interim periods in fiscal years beginning after December 15, 2017. Early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements. |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Inventories [Abstract] | |
Schedule of inventories | June 30, December 31, 2016 Finished goods $ 65,084 $ 72,490 Raw materials 292 279 Total inventories $ 65,376 $ 72,769 |
Acquisition of Mophie Inc. (Tab
Acquisition of Mophie Inc. (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Acquisition of Mophie Inc. [Abstract] | |
Summary of unaudited pro-forma results of operations | Six months ended June 30, Net sales $ 179,592 Net loss $ (7,155 ) Basic loss per share $ (0.25 ) Diluted loss per share $ (0.25 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of changes in gross long-lived intangible assets | Gross balance at December 31, 2016 $ 108,659 Impairment loss on patent (2,777 ) Gross balance at June 30, 2017 $ 105,882 |
Schedule of long-lived intangible assets, net of amortization | June 30, December 31, Customer relationships $ 11,935 $ 14,612 Tradenames 19,680 21,506 Patents and technology 12,377 15,727 Non-compete agreements 1,317 1,497 Other 18 20 Total amortizable intangible assets $ 45,327 $ 53,362 |
Fair Value Measures (Tables)
Fair Value Measures (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Measures [Abstract] | |
Schedule of assets and liabilities measured at fair value on recurring basis | Fair Value Measurements Using: June 30, Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — Fair Value Measurements Using: December 31, Level 1 Level 2 Inputs Level 3 Inputs Money market funds included in cash equivalents $ 5 $ 5 — — |
Debt and Line of Credit (Tables
Debt and Line of Credit (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt and Line of Credit [Abstract] | |
Schedule of long-term debt, net | June 30, December 31, 2016 Line of credit $ 30,683 $ 31,307 Term loan 17,014 20,107 Total debt outstanding 47,697 51,514 Less current portion 36,868 41,791 Total long-term debt outstanding $ 10,829 $ 9,623 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings (Loss) Per Share [Abstract] | |
Schedule of reconciliation of numerator and denominator used to calculate basic loss per share and diluted loss per share | Three months ended June 30, June 30, Net income (loss) $ 3,403 $ (1,046 ) Weighted average shares outstanding: Basic 27,963 28,126 Dilutive effect of restricted stock units and warrants 250 --- Diluted 28,213 28,126 Earnings (loss) per share: Basic $ 0.12 $ (0.04 ) Diluted $ 0.12 $ (0.04 ) Six months ended June 30, June 30, Net loss $ (2,735 ) $ (4,335 ) Weighted average shares outstanding: Basic 28,010 27,918 Dilutive effect of restricted stock units and warrants — — Diluted 28,010 27,918 Earnings (loss) per share: Basic $ (0.10 ) $ (0.16 ) Diluted $ (0.10 ) $ (0.16 ) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies [Abstract] | |
Schedule of future minimum rental payments required under the operating leases | Remaining 2017 $ 1,457 2018 2,177 2019 1,714 2020 1,529 2021 1,455 Thereafter 2,584 Total $ 10,916 |
Concentrations (Tables)
Concentrations (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Concentrations [Abstract] | |
Schedules of concentration of accounts receivable and sales | June 30, December 31, 2016 Superior 38 % 32 % Best Buy 14 % 22 % GENCO 8 % 10 % Three months ended June 30, Three months ended June 30, Superior 31 % 27 % GENCO 8 % 12 % Six months ended June 30, Six months ended June 30, Superior 29 % 24 % GENCO 10 % 11 % Best Buy 8 % 10 % |
Schedule of percentage of sales by geographic region | 2017 2016 United States 87 % 90 % Europe 8 % 6 % Other 5 % 4 % 2017 2016 United States 86 % 89 % Europe 8 % 7 % Other 6 % 4 % |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | Three months ended June 30, Three months ended June 30, ZAGG segment $ 74,259 $ 67,810 mophie segment 40,968 32,023 Net sales $ 115,227 $ 99,833 Six months ended June 30, Six months ended June 30, ZAGG segment $ 131,424 $ 122,607 mophie segment 76,749 39,659 Net sales $ 208,173 $ 162,266 Three months ended June 30, Three months ended June 30, ZAGG segment $ 27,790 $ 26,645 mophie segment 8,034 4,228 Gross profit $ 35,824 $ 30,873 Six months ended June 30, Six months ended June 30, ZAGG segment $ 52,093 $ 49,465 mophie segment 12,337 5,137 Gross profit $ 64,430 $ 54,602 Three months ended Three months ended ZAGG segment $ 9,177 $ 8,288 mophie segment (3,680 ) (9,640 ) Income (loss) from operations $ 5,497 $ (1,352 ) Six months ended June 30, Six months ended June 30, ZAGG segment $ 10,216 $ 8,701 mophie segment (11,368 ) (13,756 ) Loss from operations $ (1,152 ) $ (5,055 ) June 30, December 31, ZAGG segment $ 141,192 $ 156,123 mophie segment 140,482 154,606 Total assets $ 281,674 $ 310,729 |
Nature of Operations and Basi31
Nature of Operations and Basis of Presentation (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Nature of Operations and Basis of Presentation (Textual) | |
Recognition of income tax expense | $ 171 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Inventories [Abstract] | ||
Finished goods | $ 65,084 | $ 72,490 |
Raw materials | 292 | 279 |
Total inventories | $ 65,376 | $ 72,769 |
Inventories (Details Textual)
Inventories (Details Textual) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Inventories (Textual) | ||
Inventory deposits with third-party manufacturers | $ 957 | $ 437 |
Acquisition of Mophie Inc. (Det
Acquisition of Mophie Inc. (Details) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2016USD ($)$ / shares | |
Acquisition of Mophie Inc. [Abstract] | |
Net sales | $ | $ 179,592 |
Net loss | $ | $ (7,155) |
Basic loss per share | $ / shares | $ (0.25) |
Diluted loss per share | $ / shares | $ (0.25) |
Acquisition of Mophie Inc. (D35
Acquisition of Mophie Inc. (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 4 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Acquisition of Mophie Inc. (Textual) | |||||
Net loss before tax | $ 4,945 | $ (1,947) | $ (2,214) | $ (6,038) | |
Mophie Inc. [Member] | |||||
Acquisition of Mophie Inc. (Textual) | |||||
Net sales | $ 39,659 | ||||
Net loss before tax | $ 13,727 | ||||
Pro forma net loss amortization expense | 4,412 | ||||
Amortization of debt issuance costs | 1,007 | ||||
Business acquisition pro forma information | $ 6,937 |
Goodwill and Intangible Asset36
Goodwill and Intangible Assets (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2017USD ($) | |
Goodwill and Intangible Assets [Abstract] | |
Gross balance at December 31, 2016 | $ 108,659 |
Impairment loss on patent | (2,777) |
Gross balance at June 30, 2017 | $ 105,882 |
Goodwill and Intangible Asset37
Goodwill and Intangible Assets (Details 1) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | $ 45,327 | $ 53,362 |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | 11,935 | 14,612 |
Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | 19,680 | 21,506 |
Patents and technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | 12,377 | 15,727 |
Non-compete agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | 1,317 | 1,497 |
Other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total amortizable intangible assets | $ 18 | $ 20 |
Goodwill and Intangible Asset38
Goodwill and Intangible Assets (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Goodwill and Intangible Assets (Textual) | |||||
Goodwill | $ 12,272 | $ 12,272 | $ 12,272 | ||
Impairment loss on patents | 2,777 | ||||
Accumulated amortization | 818 | ||||
Intangible assets carrying value | 1,959 | ||||
Cancelled of carrying value intangible assets | $ 0 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Taxes (Textual) | ||||
Effective tax rate | 31.20% | 46.30% | 23.50% | 28.20% |
U.S. Federal statutory rate | 35.00% |
Fair Value Measures (Details)
Fair Value Measures (Details) - Fair value measurements recurring basis [Member] - Money market funds [Member] - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Estimate of Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | $ 5 | $ 5 |
Level 1 Inputs [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Money market funds included in cash equivalents | 5 | 5 |
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 |
Debt and Line of Credit (Detail
Debt and Line of Credit (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Debt and Line of Credit [Abstract] | ||
Line of credit | $ 30,683 | $ 31,307 |
Term loan | 17,014 | 20,107 |
Total debt outstanding | 47,697 | 51,514 |
Less current portion | (6,185) | (10,484) |
Total long-term debt outstanding | $ 10,829 | $ 9,623 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Stock-Based Compensation (Textual) | |||||
Number of shares not yet vested or been forefeited | 239 | 239 | |||
Payment to reduction of additional paid-in capital | $ 240 | $ 621 | |||
Employee stock purchase plan | $ 29 | ||||
Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Restricted stock granted | 123 | 380 | 434 | 713 | |
Weighted-average fair value of restricted stock per share | $ 6.35 | $ 5.40 | $ 6.57 | $ 7.33 | |
Number of restricted stock achieved | 418 | ||||
Number of restricted shares vested | 29 | ||||
Number of restricted shares forfeited | 150 | ||||
Maximum [Member] | Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Term of restricted stock vested | 3 years | ||||
Minimum [Member] | Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Term of restricted stock vested | 9 months | ||||
Selling, general, and administrative expense [Member] | Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Stock-based compensation expense | $ 966 | $ 957 | $ 1,636 | $ 2,291 | |
Executives [Member] | Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Shares granted in excess of original grant | 434 | 713 | |||
Employees [Member] | Restricted stock units [Member] | |||||
Stock-Based Compensation (Textual) | |||||
Shares granted in excess of original grant | 372 | 418 |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings (Loss) Per Share [Abstract] | ||||
Net income (loss) | $ 3,403 | $ (1,046) | $ (2,735) | $ (4,335) |
Weighted average shares outstanding: | ||||
Basic | 27,963 | 28,126 | 28,010 | 27,918 |
Dilutive effect of restricted stock units and warrants | 250 | |||
Diluted | 28,213 | 28,126 | 28,010 | 27,918 |
Earnings (loss) per share: | ||||
Basic | $ 0.12 | $ (0.04) | $ (0.10) | $ (0.16) |
Diluted | $ 0.12 | $ (0.04) | $ (0.10) | $ (0.16) |
Earnings (Loss) Per Share (De44
Earnings (Loss) Per Share (Details Textual) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings (Loss) Per Share (Textual) | |||
Warrants and restricted stock units to purchase shares of common stock | 895 | 980 | 895 |
Treasury Stock (Details)
Treasury Stock (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2016 | |
Treasury Stock (Textual) | |||
Treasury stock common, shares | 0 | 234 | |
Cash consideration paid for purchase of common stock | $ 1,492 | ||
Commissions paid to brokers | $ 9 | ||
Weighted average price per share | $ 6.32 |
Commitments and Contingencies46
Commitments and Contingencies (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Commitments and Contingencies [Abstract] | |
Remaining 2,017 | $ 1,457 |
2,018 | 2,177 |
2,019 | 1,714 |
2,020 | 1,529 |
2,021 | 1,455 |
Thereafter | 2,584 |
Total | $ 10,916 |
Commitments and Contingencies47
Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Dec. 16, 2016 | Oct. 21, 2016 | Oct. 29, 2015 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Commitments and Contingencies (Textual) | |||||||
Operating leases expire, Description | Expire through 2023. | ||||||
Rent expense | $ 758 | $ 939 | $ 1,443 | $ 1,656 | |||
Contingent payments, description | The Merger Agreement by failing to pay certain contingent payments (the "Contingent Payments") related to tax refunds and customs duty recoveries and seeking damages in an amount no less than $11,420. | ||||||
Damages exceeding value | $ 22,000 | ||||||
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. |
Concentrations (Details)
Concentrations (Details) - Customer Concentration Risk [Member] | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
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 | 38.00% | 32.00% | |||
Accounts Receivable [Member] | Best Buy [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 14.00% | 22.00% | |||
Accounts Receivable [Member] | GENCO [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 8.00% | 10.00% | |||
Sales Revenue, Net [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 10.00% | 10.00% | 10.00% | 10.00% | |
Sales Revenue, Net [Member] | Superior [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 31.00% | 27.00% | 29.00% | 24.00% | |
Sales Revenue, Net [Member] | Best Buy [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 8.00% | 10.00% | |||
Sales Revenue, Net [Member] | GENCO [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk percentage | 8.00% | 12.00% | 10.00% | 11.00% |
Concentrations (Details 1)
Concentrations (Details 1) - Sales revenue [Member] | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
United States [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage of sales | 87.00% | 90.00% | 86.00% | 89.00% |
Europe [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage of sales | 8.00% | 6.00% | 8.00% | 7.00% |
Other [Member] | ||||
Concentration Risk [Line Items] | ||||
Percentage of sales | 5.00% | 4.00% | 6.00% | 4.00% |
Concentrations (Details Textual
Concentrations (Details Textual) - Customer Concentration Risk [Member] - Customer | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Accounts Receivable [Member] | |||||
Concentrations (Textual) | |||||
Percentage of sales | 10.00% | 10.00% | |||
Number of customer | 2 | ||||
Accounts revenues in percentage of all customers, description | No other customer account balances were more than 10% of accounts receivable | No other customer account balances were more than 10% of accounts receivable | |||
Accounts Receivable [Member] | GENCO [Member] | |||||
Concentrations (Textual) | |||||
Percentage of sales | 10.00% | 10.00% | 10.00% | ||
Number of customer | 2 | ||||
Sales Revenue, Net [Member] | |||||
Concentrations (Textual) | |||||
Percentage of sales | 10.00% | 10.00% | 10.00% | 10.00% | |
Accounts revenues in percentage of all customers, description | No other customers accounted for greater than 10% of net sales. | No other customers accounted for greater than 10% of net sales. |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Schedule of segment reporting information [Abstract] | |||||
Net sales | $ 115,227 | $ 99,833 | $ 208,173 | $ 162,266 | |
Gross profit | 35,824 | 30,873 | 64,430 | 54,602 | |
Income (loss) from operations | 5,497 | (1,352) | (1,152) | (5,055) | |
Total assets | 281,674 | 281,674 | $ 310,729 | ||
ZAGG segment [Member] | |||||
Schedule of segment reporting information [Abstract] | |||||
Net sales | 74,259 | 67,810 | 131,424 | 122,607 | |
Gross profit | 27,790 | 26,645 | 52,093 | 49,465 | |
Income (loss) from operations | 9,177 | 8,288 | 10,216 | 8,701 | |
Total assets | 141,192 | 141,192 | 156,123 | ||
Mophie segment [Member] | |||||
Schedule of segment reporting information [Abstract] | |||||
Net sales | 40,968 | 32,023 | 76,749 | 39,659 | |
Gross profit | 8,034 | 4,228 | 12,337 | 5,137 | |
Income (loss) from operations | (3,680) | $ (9,640) | (11,368) | $ (13,756) | |
Total assets | $ 140,482 | $ 140,482 | $ 154,606 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) | 6 Months Ended |
Jun. 30, 2017Segment | |
Segment Reporting (Textual) | |
Number of operating segments | 2 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | Jul. 17, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | $ 30,683 | $ 31,307 | |
Subsequent Events [Member] | |||
Subsequent Events (Textual) | |||
Credit agreement, description | ● Increase the Maximum Revolving Amount, as defined in the Credit Agreement, from $85,000 to: ○ $135,000 from July 17, 2017 to December 31, 2017; ○ $110,000 million from January 1, 2018 to May 31, 2018; and ○ $100,000 from June 1, 2018 forward. ● Expand Permitted Foreign Subsidiary Loans, Guaranties and Investments, as defined in the Credit Agreement, to include: ○ A $2,000 loan dated April 5, 2017 from the Company to ZAGG International Distribution Limited; and ○ Any other loan or investment by the Company or any domestic subsidiary of the Company in or to, or guaranty of indebtedness of, any foreign subsidiary of the Company for the period July 17, 2017 to March 31, 2018, in an aggregate amount not to exceed $8,000. ● Increase the Letter of Credit Commitment, as defined in the Credit Agreement, from $7,500 to an aggregate amount of $40,000. ● Increase the Borrowing Base, as defined in the Credit Agreement, on a seasonal basis between August 1, 2017 and September 30, 2017 by $15,000. | ||
Revolving credit | $ 145 | ||
Subsequent Events [Member] | Letter of Credit [Member] | |||
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | 7,500 | ||
Aggregate amount | 40,000 | ||
Subsequent Events [Member] | July 17, 2017 to December 31, 2017 [Member] | |||
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | 135,000 | ||
Subsequent Events [Member] | January 1, 2018 to May 31, 2018 [Member] | |||
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | 110,000 | ||
Subsequent Events [Member] | June 1, 2018 [Member] | |||
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | 100,000 | ||
Subsequent Events [Member] | July 17, 2017 to March 31, 2018 [Member] | |||
Subsequent Events (Textual) | |||
Aggregate amount | 8,000 | ||
Subsequent Events [Member] | August 1, 2017 and September 30, 2017 [Member] | |||
Subsequent Events (Textual) | |||
Increase the Maximum Revolving Amount Credit Agreement | $ 15,000 |