Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Mar. 31, 2015 | Jun. 04, 2015 | Sep. 30, 2014 | |
Document and Entity Information | |||
Entity Registrant Name | RealD Inc. | ||
Entity Central Index Key | 1327471 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Mar-15 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -28 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $415,290,750 | ||
Entity Common Stock, Shares Outstanding | 50,491,890 | ||
Document Fiscal Year Focus | 2015 | ||
Document Fiscal Period Focus | FY |
Consolidated_balance_sheets
Consolidated balance sheets (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $60,333 | $28,800 |
Accounts receivable, net | 26,748 | 48,422 |
Inventories | 8,305 | 9,109 |
Deferred costs—eyewear | 80 | 149 |
Prepaid expenses and other current assets | 4,770 | 5,197 |
Total current assets | 100,236 | 91,677 |
Property and equipment, net | 20,599 | 22,491 |
Cinema systems, net | 82,243 | 106,735 |
Digital projectors, net-held for sale | 0 | 57 |
Goodwill | 10,657 | 10,657 |
Other intangibles, net | 4,817 | 6,154 |
Deferred income taxes | 2,461 | 4,571 |
Other assets | 8,631 | 4,840 |
Total assets | 229,644 | 247,182 |
Current liabilities: | ||
Accounts payable | 9,652 | 12,470 |
Accrued expenses and other liabilities | 26,640 | 21,896 |
Deferred revenue | 5,009 | 8,143 |
Income taxes payable | 1,619 | 1,790 |
Deferred income taxes | 2,583 | 4,288 |
Current portion of Credit Agreement | 7,460 | 12,500 |
Total current liabilities | 52,963 | 61,087 |
Credit Agreement, net of current portion | 22,380 | 23,750 |
Deferred revenue, net of current portion | 3,931 | 6,465 |
Other long-term liabilities and customer deposits | 4,027 | 5,046 |
Total liabilities | 83,301 | 96,348 |
Commitments and contingencies | ||
Equity | ||
Common stock, $0.0001 par value, 200,000 shares authorized; 50,434 and 49,438 shares issued and outstanding at March 31, 2015 and March 31, 2014, respectively | 371,689 | 352,913 |
Accumulated deficit | -226,803 | -201,763 |
Accumulated other comprehensive income | 1,960 | 262 |
Total RealD Inc. stockholders' equity | 146,846 | 151,412 |
Noncontrolling interest | -503 | -578 |
Total equity | 146,343 | 150,834 |
Total liabilities and equity | $229,644 | $247,182 |
Consolidated_balance_sheets_Pa
Consolidated balance sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 50,434,000 | 49,438,000 |
Common stock, shares outstanding | 50,434,000 | 49,438,000 |
Consolidated_statements_of_ope
Consolidated statements of operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue: | |||
License | $109,317 | $132,512 | $137,752 |
Product and other | 54,146 | 66,722 | 77,800 |
Total revenue | 163,463 | 199,234 | 215,552 |
Cost of revenue: | |||
License | 47,086 | 45,364 | 47,243 |
Product and other | 35,599 | 58,611 | 78,117 |
Total cost of revenue | 82,685 | 103,975 | 125,360 |
Gross profit | 80,778 | 95,259 | 90,192 |
Operating expenses: | |||
Research and development | 19,474 | 19,685 | 19,454 |
Selling and marketing | 21,719 | 27,137 | 25,266 |
General and administrative | 49,370 | 50,596 | 47,830 |
Total operating expenses | 90,563 | 97,418 | 92,550 |
Operating loss | -9,785 | -2,159 | -2,358 |
Interest expense, net | -1,634 | -2,255 | -1,483 |
Other loss | -4,419 | -679 | -982 |
Loss before income taxes | -15,838 | -5,093 | -4,823 |
Income tax expense | 7,909 | 6,117 | 5,064 |
Net loss | -23,747 | -11,210 | -9,887 |
Net (income) loss attributable to noncontrolling interest | -75 | -196 | 197 |
Net loss attributable to RealD Inc. common stockholders | ($23,822) | ($11,406) | ($9,690) |
Loss per common share: | |||
Basic (in dollars per share) | ($0.48) | ($0.23) | ($0.19) |
Diluted (in dollars per share) | ($0.48) | ($0.23) | ($0.19) |
Shares used in computing earnings per common share: | |||
Basic (in shares) | 50,042 | 49,504 | 52,345 |
Diluted (in shares) | 50,042 | 49,504 | 52,345 |
Consolidated_statements_of_com
Consolidated statements of comprehensive income (loss) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Comprehensive Income [Abstract] | |||
Net loss | ($23,747) | ($11,210) | ($9,887) |
Other Comprehensive income, net of reclassification adjustments and taxes: | |||
Foreign currency translation gains | 1,698 | 147 | 115 |
Other comprehensive income, net of tax | 1,698 | 147 | 115 |
Comprehensive loss | ($22,049) | ($11,063) | ($9,772) |
Consolidated_statements_of_cha
Consolidated statements of changes in equity (USD $) | Total | Common stock | Accumulated other comprehensive loss | Accumulated deficit | Noncontrolling interest |
In Thousands, except Share data, unless otherwise specified | |||||
Balance at Mar. 23, 2012 | $197,606 | $309,894 | ($112,711) | $423 | |
Balance (in shares) at Mar. 23, 2012 | 54,561,178 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Share-based compensation | 18,474 | 18,474 | |||
Exercise of stock options | 3,516 | 3,516 | |||
Exercised | 543,797 | ||||
Issuance of common stock in connection with restricted stock units (in shares) | 80,781 | ||||
Purchase and distribution of stock under employee stock purchase plan | 810 | 810 | |||
Purchase and distribution of stock under employee stock purchase plan (in shares) | 107,108 | ||||
Repurchases of common stock | -60,445 | -60,445 | |||
Repurchases of common stock (in shares) | -5,927,729 | -5,927,729 | |||
Other comprehensive loss, net of tax | 115 | 115 | |||
Noncontrolling interest distribution | -1,000 | -1,000 | |||
Net loss | -9,887 | -9,690 | -197 | ||
Balance at Mar. 31, 2013 | 149,189 | 332,694 | 115 | -182,846 | -774 |
Balance (in shares) at Mar. 31, 2013 | 49,365,135 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Share-based compensation | 17,741 | 17,741 | |||
Exercise of stock options | 2,003 | 2,003 | |||
Exercised | 614,448 | ||||
Issuance of common stock in connection with restricted stock units (in shares) | 50,058 | ||||
Purchase and distribution of stock under employee stock purchase plan | 475 | 475 | |||
Purchase and distribution of stock under employee stock purchase plan (in shares) | 79,856 | ||||
Repurchases of common stock | -7,511 | -7,511 | |||
Repurchases of common stock (in shares) | -671,997 | -671,997 | |||
Other comprehensive loss, net of tax | 147 | 147 | |||
Net loss | -11,210 | -11,406 | 196 | ||
Balance at Mar. 31, 2014 | 150,834 | 352,913 | 262 | -201,763 | -578 |
Balance (in shares) at Mar. 31, 2014 | 49,437,500 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Share-based compensation | 14,898 | 14,898 | |||
Exercise of stock options | 3,587 | 3,587 | |||
Exercised | 779,361 | ||||
Issuance of common stock in connection with restricted stock units (in shares) | 279,148 | ||||
Repurchase of Statutory Withholdings of Stock Issued for Restricted Stock Units, Shares | -98,710 | ||||
Repurchase of Statutory Withholdings of Stock Issued for Restricted Stock Units | -1,218 | 0 | -1,218 | ||
Purchase and distribution of stock under employee stock purchase plan | 291 | 291 | |||
Purchase and distribution of stock under employee stock purchase plan (in shares) | 36,478 | ||||
Repurchases of common stock | -67,900 | ||||
Repurchases of common stock (in shares) | -6,599,726 | ||||
Other comprehensive loss, net of tax | 1,698 | 1,698 | |||
Net loss | -23,747 | -23,822 | 75 | ||
Balance at Mar. 31, 2015 | $146,343 | $371,689 | $1,960 | ($226,803) | ($503) |
Balance (in shares) at Mar. 31, 2015 | 50,433,777 |
Consolidated_statements_of_cas
Consolidated statements of cash flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities | |||
Net loss | ($23,747) | ($11,210) | ($9,887) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 39,999 | 40,300 | 33,131 |
Deferred income tax | 405 | -142 | -241 |
Non-cash interest expense | 119 | 529 | 483 |
Non-cash stock compensation | 14,898 | 17,741 | 18,474 |
Non-cash bad debt expense | 638 | 609 | -209 |
Non-cash bad debt expense | -8 | 307 | 44 |
(Gain) Loss on disposal of property and equipment | 5,023 | 4,522 | 8,679 |
Accounts receivable | 21,036 | -3,559 | 11,475 |
Impairment of long-lived assets | |||
Accounts receivable | 804 | 6,321 | 25,147 |
Inventories | 689 | -1,611 | -954 |
Prepaid expenses and other current assets | 69 | 389 | 394 |
Deferred costs—eyewear | -3,015 | 191 | -590 |
Other assets | -2,768 | -10,308 | 125 |
Accounts payable | 4,744 | -3,646 | -7,790 |
Accrued expenses and other liabilities | -1,019 | -610 | 2,747 |
Other long-term liabilities, customer deposits and virtual print fee liability | -433 | 1,574 | -518 |
Income taxes receivable/payable | -5,587 | -5,697 | -813 |
Net cash provided by operating activities | 51,847 | 35,700 | 79,697 |
Net cash provided by operating activities | |||
Cash flows from investing activities | -4,359 | -4,285 | -16,169 |
Purchases of property and equipment | -13,071 | -18,050 | -18,121 |
Purchases of cinema systems and related components | 0 | 0 | -6,084 |
Purchases of intangible assets | 63 | 551 | 2,474 |
Net cash used in investing activities | -17,367 | -21,784 | -37,900 |
Net cash used in investing activities | |||
Cash flows from financing activities | 0 | 0 | -1,000 |
Noncontrolling interest distribution | -895 | 0 | -1,167 |
Repayments of long-term debt | 37,300 | 37,500 | 60,000 |
Proceeds from credit facility | -43,710 | -48,750 | -37,500 |
Repayments on credit facility | 3,587 | 2,003 | 3,516 |
Proceeds from exercise of stock options | 291 | 475 | 810 |
Proceeds from exercise of motion picture exhibitor options | 0 | -7,511 | -60,445 |
Repayments on tax withholding of restricted stock units | -1,218 | 0 | 0 |
Net cash used in financing activities | -4,645 | -16,283 | -35,786 |
Purchases of treasury stock | 1,698 | 147 | 115 |
Effect of currency exchange rate changes on cash and cash equivalents | 28,800 | 31,020 | 24,894 |
Net increase (decrease) in cash and cash equivalents | 60,333 | 28,800 | 31,020 |
Cash and cash equivalents, beginning of year | |||
Cash and cash equivalents, end of year | 4,308 | 872 | 1,967 |
Supplemental disclosures of cash flow information | 1,515 | 1,726 | 1,000 |
Cash and Cash Equivalents, Period Increase (Decrease) | $31,533 | ($2,220) | $6,126 |
Business_and_basis_of_presenta
Business and basis of presentation | 12 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and basis of presentation | Business and basis of presentation |
RealD Inc., including its subsidiaries ("RealD"), is a leading global licensor of 3D and other visual technologies. | |
The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP). The consolidated financial statements include the accounts of RealD, its wholly owned subsidiaries and its majority owned subsidiaries. The Company does not have any interests in variable interest entities. For consolidated subsidiaries that are not wholly owned but are majority owned, the subsidiaries' assets, liabilities, and operating results are included in their entirety in the accompanying consolidated financial statements. The noncontrolling interests in those assets, liabilities, and operations are reflected as non-controlling interests in the consolidated balance sheets under equity and consolidated statements of operations. | |
All significant intercompany balances and transactions have been eliminated in consolidation. |
Summary_of_significant_account
Summary of significant accounting policies | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Accounting Policies [Abstract] | ||||||||||||
Summary of significant accounting policies | Summary of significant accounting policies | |||||||||||
Accounting period | ||||||||||||
On November 14, 2012, RealD's Board of Directors approved a change in our accounting periods from the previous configuration of four 13-week periods for a total of 52 weeks to a calendar month end and calendar quarter end accounting period. This change in accounting period commenced in the third quarter ended December 31, 2012 of fiscal year 2013. As a result, the years ended March 31, 2015 and 2014 are eight days shorter (2.1%) than the year ended March 31, 2013. | ||||||||||||
Use of estimates | ||||||||||||
The preparation of 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 applicable disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. The most significant estimates made by management in the preparation of the financial statements relate to the following: | ||||||||||||
• | licensing revenue terms applied to the timing and number of motion picture exhibitor consumer admissions; | |||||||||||
• | domestic eyewear product revenue terms applied to when the usage occurs and the amount of usage; | |||||||||||
• | effects of allowances that are capitalized on the balance sheet and amortized to the applicable line item on the statement of operations as expense or contra revenue and earned customer incentives when customers do not timely report the activity that results in earned allowances and incentives; | |||||||||||
• | customer contract terms on revenue and balance sheet items; | |||||||||||
• | impairment testing of goodwill, intangible assets and tangible assets, including determination of relevant reporting units and long-lived asset groups; | |||||||||||
• | useful lives of intangible assets and tangible assets; | |||||||||||
• | timing and amount recognized for performance-based compensation, including bonus, executive salary and executive restricted share units, based on projections of Company performance achievement; | |||||||||||
• | the impact of potential future tax consequences of events that have been recognized in the Company’s financial statements; | |||||||||||
• | valuation of accruals and allowances; | |||||||||||
• | contingency assessments; and | |||||||||||
• | assumptions used in the determination of the fair value of equity-based awards for stock-based compensation. | |||||||||||
Earnings (loss) per share of common stock | ||||||||||||
Basic income per share of common stock is computed by dividing the net income (loss) attributable to RealD common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing net income (loss) attributable to RealD Inc. common stockholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include outstanding stock options, shares to be purchased under our employee stock purchase plan and unvested restricted stock units. The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. | ||||||||||||
The calculation of the basic and diluted loss per share of common stock for the years ended March 31, 2015, March 31, 2014 and March 31, 2013 was as follows: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands, except per share data) | 2015 | 2014 | 2013 | |||||||||
Numerator: | ||||||||||||
Net loss | $ | (23,747 | ) | $ | (11,210 | ) | $ | (9,887 | ) | |||
Net (income) loss attributable to noncontrolling interest | (75 | ) | (196 | ) | 197 | |||||||
Net loss attributable to RealD Inc. common stockholders | $ | (23,822 | ) | $ | (11,406 | ) | $ | (9,690 | ) | |||
Denominator: | ||||||||||||
Weighted-average common shares outstanding (basic) | 50,042 | 49,504 | 52,345 | |||||||||
Effect of dilutive securities | — | — | — | |||||||||
Weighted-average common shares outstanding (diluted) | 50,042 | 49,504 | 52,345 | |||||||||
Loss per common share: | ||||||||||||
Basic | $ | (0.48 | ) | $ | (0.23 | ) | $ | (0.19 | ) | |||
Diluted | $ | (0.48 | ) | $ | (0.23 | ) | $ | (0.19 | ) | |||
Due to the loss attributable to RealD Inc. common stockholders in the years ended March 31, 2015, March 31, 2014 and March 31, 2013, basic loss per common share and diluted loss per common share are the same as the effect of potentially dilutive securities would be anti-dilutive. | ||||||||||||
The weighted-average number of anti-dilutive shares excluded from the calculation of diluted earnings (loss) per common share for the years ended March 31, 2015, March 31, 2014 and March 31, 2013 was as follows: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Options and warrants to purchase common stock | 9,632 | 9,299 | 8,441 | |||||||||
Total | 9,632 | 9,299 | 8,441 | |||||||||
Fair value measurements | ||||||||||||
Accounting Standards Codification Topic (ASC) 820-10, Fair Value Accounting (ASC 820), provides a common definition of fair value and establishes a framework to make the measurement of fair value in U.S. GAAP more consistent and comparable. This guidance also requires expanded disclosures to provide information about the extent to which fair value is used to measure assets and liabilities, the methods and assumptions used to measure fair value, and the effect of fair value measures on earnings. Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants and requires that assets and liabilities carried at fair value be classified and disclosed in the following three categories: | ||||||||||||
• | Level 1—Quoted prices for identical instruments in active markets. | |||||||||||
• | Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. | |||||||||||
• | Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. | |||||||||||
The Company's financial assets and liabilities, which include financial instruments as defined by ASC 820, include cash and cash equivalents, accounts receivable, accounts payable, long-term debt and derivatives. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable are a reasonable approximation of fair value due to the short maturities of these instruments. The carrying amount of long-term debt approximates fair value based on borrowing rates currently available to the Company. The carrying amount of the Company's derivative instruments is recorded at fair value and is determined based on observable inputs that are corroborated by market data (Level 2). | ||||||||||||
As of March 31, 2015 and March 31, 2014, the fair values of our derivative instruments that were carried at fair value on a recurring basis were not significant. | ||||||||||||
Derivative instruments | ||||||||||||
The Company's derivative instruments are recorded at fair value in other current assets or other current liabilities, respectively, in the consolidated balance sheets. Changes in fair value are reported as a component of other income or loss on our consolidated statements of operations. For all periods presented, none of our derivative instruments were designated as hedging instruments. The Company does not use foreign currency option or foreign exchange forward contracts for speculative or trading purposes. | ||||||||||||
The Company purchases foreign currency forward contracts, generally with maturities of six months or less, to reduce the volatility of cash flows primarily related to forecasted payments and expenses denominated in certain foreign currencies. As of March 31, 2015, RealD had outstanding forward contracts based in British pound sterling and Euro with notional amounts totaling $2.9 million. As of March 31, 2014, the Company had outstanding forward contracts based in British pound sterling and Euro with notional amounts totaling $0.4 million. As of March 31, 2015, the carrying amount of the Company's foreign currency forward contracts was $0.4 million. As of March 31, 2014, the carrying amount of the Company's foreign currency forward contracts was insignificant. Foreign currency forward contracts were classified as Level 2 fair value instruments, which was determined based on observable inputs that were corroborated by market data both as of March 31, 2015 and March 31, 2014. The net realized and unrealized gains and losses related to forward contracts were $0.5 million, $0.6 million and $0.9 million for fiscal years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
Marketable securities | ||||||||||||
RealD classifies unrealized gains and losses on marketable securities reported as a component of accumulated other comprehensive income. As of March 31, 2015, March 31, 2014 and March 31, 2013, the Company had no marketable securities. | ||||||||||||
The objectives of RealD's investment policy are to preserve capital, provide sufficient liquidity to satisfy operating and investment purposes, and capture a market rate of return based on the Company's investment policy parameters and market conditions. The Company's investment policy limits investments to certain types of debt and money market instruments issued by institutions with investment grade credit ratings and places restrictions on maturities and concentration by type and issuer. | ||||||||||||
Cash equivalents | ||||||||||||
The Company considers cash equivalents to be only those investments that are highly liquid, readily convertible into cash and which mature within three months from the date of purchase. | ||||||||||||
Accounts receivable, net | ||||||||||||
Accounts receivable, net, consists of trade receivables, value-added tax ("VAT") receivables, other receivables and allowance for doubtful accounts and customer credits. The Company provides credit to its customers, who are primarily in the movie production and exhibition businesses. The Company provides for the estimated accounts receivable that will not be collected. These estimates are based on an analysis of historical bad debts, customer concentrations, customer creditworthiness, current economic trends and changes in the customers’ payment terms and their economic condition. Collection of accounts receivable may be affected by changes in economic or other industry conditions and may, accordingly, impact the Company’s overall credit risk. The allowance for doubtful accounts and customer credits totaled $5.9 million and $4.1 million as of March 31, 2015 and March 31, 2014, respectively. | ||||||||||||
Inventories and deferred costs-eyewear | ||||||||||||
Inventories and deferred costs-eyewear represent RealD eyewear and are substantially all finished goods. Inventories and deferred costs-eyewear are valued at the lower of cost (first-in, first-out method) or market value. At each balance sheet date, the Company evaluates ending inventories and deferred costs-eyewear for net realizable value. The Company also evaluates inventories for excess quantities and obsolescence. These evaluations include analyses of expected future average selling prices, projections of future demand and technology changes. In order to state inventories at the lower of cost or market, RealD maintains reserves against such inventories. If the Company’s analyses indicate that market is lower than cost, a write-down of inventories is recorded in cost of revenue in the period the loss is identified. As of March 31, 2015 and March 31, 2014, the inventory reserve as a result of our net realizable value analyses was $0.1 million and $0.6 million, respectively. | ||||||||||||
Domestically, the Company provides RealD eyewear free of charge to motion picture exhibitors and then receives a fee from the motion picture studios for the usage of RealD eyewear by the motion picture exhibitors’ consumers. Eyewear shipped from inventory is deferred on the shipment date and then amortized to cost of product revenue according to assumptions related to eyewear usage by consumers. Internationally, the motion picture exhibitors prepays the Company for RealD eyewear ordered. Inventory shipped is recognized to cost of product revenue according to transfer of title. Globally, the Company may provide limited amount of RealD eyewear to motion picture studios for marketing purposes. Inventory shipped is recognized to sales and marketing expense. | ||||||||||||
Property and equipment, RealD Cinema Systems and digital projectors | ||||||||||||
Property and equipment, RealD Cinema Systems and digital projectors are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. The major categories and related estimated useful lives are as follows: | ||||||||||||
RealD Cinema Systems | 5 - 8 years | |||||||||||
Digital projectors—held for sale | 10 years | |||||||||||
Leasehold improvements | Shorter of useful life or lease | |||||||||||
Machinery and equipment | 2 - 7 years | |||||||||||
Furniture and fixtures | 3 - 5 years | |||||||||||
Computer equipment and software | 3 - 5 years | |||||||||||
Digital projectors—held for sale (digital projectors) also include digital servers, lenses and accessories. Upon installation at the customer location, the Compnay retains title to the RealD Cinema Systems which are held and used by its customers. The digital projectors are held for sale at either a specified date or upon occurrence of certain contingent events. Depreciation for RealD Cinema Systems and digital projectors is included in cost of revenue. | ||||||||||||
Major enhancements and improvements are capitalized. Maintenance and repairs for cinema systems and digital projectors are charged to expense as incurred. Maintenance and repairs expense totaled $0.3 million, $0.5 million and $0.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
Other intangibles, net | ||||||||||||
Other intangibles, net, are deemed to have finite lives and consist of acquired developed technologies (which are primarily patents) and are amortized over their estimated useful lives of 5 to 19 years (with a weighted average remaining amortization period of 4.5 years) using the straight-line method. | ||||||||||||
Impairment of long-lived assets | ||||||||||||
The Company reviews long-lived assets, such as property and equipment, cinema systems, digital projectors and intangibles, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Factors or circumstances that could indicate the occurrence of such events include current period operating or cash flow losses combined with a history of operating or cash flow losses, a projection or forecast that demonstrates continuing operating or cash flow losses, or incurring costs in excess of amounts originally expected to acquire or construct an asset. If the asset is not recoverable, an impairment loss is recognized as the amount by which the carrying amount of the asset exceeds its fair value. | ||||||||||||
During the year ended March 31, 2015, the impairment charged to cost of revenue for all impaired RealD Cinema Systems totaled $5.0 million. | ||||||||||||
During the year ended March 31, 2014, the impairment charged to cost of revenue for all impaired RealD Cinema Systems totaled $4.5 million. | ||||||||||||
During the year ended March 31, 2013, the Company determined that a non-cancelable purchase commitment for certain cinema systems configurations in the aggregate amount of $3.5 million were not fully recoverable, primarily due to the initial investment costs which are expected to exceed the anticipated future cash flows for the related cinema systems. The impairment charged during the year ended March 31, 2013 for all impaired RealD Cinema Systems charged to cost of revenue was $8.0 million of the total $8.7 million impairment expense. | ||||||||||||
Goodwill | ||||||||||||
Goodwill is deemed to have an indefinite useful life and therefore is not amortized. The Company evaluates its goodwill for impairment using a two-step process that is performed at least annually during our fourth fiscal quarter, or whenever events or circumstances indicate that goodwill may be impaired. The first step is a comparison of the fair value of an internal reporting unit with its carrying amount, including goodwill. A reporting unit is an operating segment or one level below an operating segment. If the fair value of the reporting unit exceeds its carrying value, goodwill of the reporting unit is not considered impaired and the second step is unnecessary. If the carrying value of the reporting unit exceeds its fair value, the second step is performed to measure the amount of impairment by comparing the carrying amount of the goodwill to a determination of the implied value of the goodwill. If the carrying amount of goodwill is greater than the implied value, an impairment loss is recognized for the difference. The Company currently has one reporting unit in which goodwill resides and the reporting unit did not fail step one. | ||||||||||||
Revenue recognition | ||||||||||||
The Company derives substantially all of its revenue from the license of RealD Cinema Systems and the product sale of RealD eyewear. RealD evaluates revenue recognition for transactions using the criteria set forth by the Financial Accounting Standard Board (FASB) Accounting Standards Codification (ASC) Topic 840, Leases, and ASC Topic 605, Revenue Recognition. The revenue recognition guidance states that revenue is recognized when all of the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable and collectability is reasonably assured. The Company records revenue net of estimated allowances. | ||||||||||||
License revenue | ||||||||||||
License revenue, net of lease incentives and other allowances, is accounted for as an operating lease. License revenue is primarily derived under per-admission, percentage of box office, periodic fixed fee, or per-motion picture basis with motion picture exhibitors. Amounts received up front, less estimated lease incentives, are deferred and recognized over the lease term using the straight-line method. Additional lease payments that are contingent upon future events outside the Company’s control, including those related to admission and usage, are recognized as revenues when the contingency is resolved and the Company has no more obligations to our customers specific to the contingent payment received. Certain of the Company’s license revenue from leasing RealD Cinema Systems is earned upon admission by the motion picture exhibitor’s consumers. The Company’s licensees, however, do not report and pay for such license revenue until after the admission has occurred, which may be received subsequent to the Company’s fiscal period end. The Company estimates and records domestic licensing revenue related to motion picture exhibitor consumer admissions in the quarter in which the admission occurs, but only when reasonable estimates of such amounts can be made. The Company records its international licensing revenue based on actual amounts reported by motion picture exhibitors. The Company determines that there is persuasive evidence of an arrangement upon the execution of a license agreement or upon the receipt of a licensee’s admissions report. Revenue is deemed fixed or determinable upon receipt of a licensee’s admissions report or evidence of a RealD box office showing by licensee. The Company determines collectability based on an evaluation of the licensee’s recent payment history and evaluation of the respective customer’s credit-standing. | ||||||||||||
Product revenue | ||||||||||||
The Company recognizes product revenue, net of allowances, when title and risk of loss have passed and when there is persuasive evidence of an arrangement, the payment is fixed or determinable, and collectability of payment is reasonably assured. In the United States and Canada, certain of the Company’s product revenue from the sale of RealD eyewear is earned upon admission and usage by the motion picture exhibitor’s consumers. The Company’s customers, however, do not report admission or usage information until after the admission and usage has occurred, and such information may be received subsequent to the Company’s fiscal period end. Accordingly, the Company estimates and records such product revenue in the quarter in which the admission and usage occurs, but only when reasonable estimates of such amounts can be made. Internationally, the motion picture exhibitors prepays for the RealD eyewear, which is deferred upon receipt of cash and earned upon shipping and transfer of title of the products. There are not estimates made in relation to international sales. | ||||||||||||
Cost of revenue | ||||||||||||
Cost of revenue principally consists of depreciation expense of RealD Cinema Systems deployed at a motion picture exhibitor's premises, digital projector depreciation expenses, impairment of goodwill and intangible assets, losses on assets of non-cancelable commitments, RealD eyewear costs (including shipping, handling and recycling costs), field service and support costs, occupancy costs and gain and loss from sale of production assets. Additionally, RealD provides certain cinema equipment to customers as lease incentives, which depreciated over life of the asset. | ||||||||||||
Shipping and handling costs | ||||||||||||
Amounts billed to customers for shipping and handling costs are included in revenue. Shipping and handling costs that we incur consist primarily of packaging and transportation charges and are recorded in cost of revenue. Shipping and handling costs recognized in cost of revenue were $4.0 million, $6.6 million and $7.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
Research and development costs | ||||||||||||
Research and development (R&D) costs are expensed as incurred. Major components of R&D expense include salaries and benefits, depreciation for R&D assets, materials and supplies inclusive of prototypes, non-recurring engineering, payments to third parties for R&D, facilities and equipment that can only be used for a particular project and overhead allocations of various administrative and facilities costs related to R&D. | ||||||||||||
Selling and marketing costs | ||||||||||||
Selling and marketing costs are primarily comprised of personnel costs related to our selling and marketing staff, advertising costs, including promotional events and other brand building and product marketing expenses, corporate communications, certain professional fees, occupancy costs and travel expenses. | ||||||||||||
Advertising costs are expensed as incurred. Advertising expenses were approximately $2.9 million, $2.7 million and $3.7 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
General and administrative costs | ||||||||||||
General and administrative costs principally consist of personnel costs related to our executive, legal, finance and human resources staff, professional fees including legal and accounting costs, occupancy costs, public company costs, bad debt expenses and gain and loss from disposition of assets. Additionally, general and administrative costs include sales, use, goods and services tax and value added tax (collectively, the "transaction taxes") as well as property taxes. For our U.S. and some of our international cinema license and product revenue, we absorb the majority of the transaction taxes. | ||||||||||||
Share-based compensation | ||||||||||||
RealD accounts for share-based awards granted to employees and directors by recording compensation expense based on estimated fair values. The Company estimates the fair value of share-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in its consolidated statements of operations. Share-based awards are attributed to expense using the straight-line method over the vesting period. The Company determines the value of each option award that contains a market condition using a Monte Carlo Simulation valuation model, while all other option awards are valued using the Black-Scholes valuation model as permitted under ASC 718, Compensation—Stock Compensation. The assumptions used in calculating the fair value of share-based payment awards represent the Company's best estimates. The Company's estimates of the fair values of share-based awards granted and the resulting amounts of share-based compensation recognized may be impacted by certain variables including stock price volatility, employee stock option exercise behaviors, additional stock option grants, modifications, estimates of forfeitures, and the related income tax impact. If any of the assumptions used in the Company's valuation models significantly change, share-based compensation for future awards may differ materially from the awards granted previously. See Note 9, Share-based compensation. | ||||||||||||
Foreign currency | ||||||||||||
Local currency transactions of the Company's foreign operations that have the U.S. dollar as their functional currency are remeasured into U.S. dollars using current rates of exchange for monetary assets and liabilities and historical rates of exchange for nonmonetary assets and liabilities. Gains and losses from remeasurement of monetary assets and liabilities are included in other income (loss) in the Company's statements of operations. | ||||||||||||
The assets and liabilities of our foreign operations for which the functional currency is not the U.S. dollar are translated into U.S. dollars at exchange rates as of the balance sheet date, revenues and expenses are translated at average exchange rates for the period, and equity balances are translated at the historical rate. Resulting translation adjustments are included in other comprehensive loss, a component of equity (deficit). | ||||||||||||
Net income and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional currency and the net realized and unrealized gains and losses related to forward contracts totaled $0.5 million, $0.6 million and $0.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively, and are included in other income (loss). | ||||||||||||
Income taxes | ||||||||||||
Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities at year-end and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount more likely than not to be realized. | ||||||||||||
Accruals for uncertain tax positions are provided for in accordance with the authoritative guidance for accounting for uncertainty in income taxes (ASC 740). The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The authoritative guidance for accounting for uncertainty in income taxes also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. The Company's policy is to recognize interest expense and penalties related to income tax matters as a component of income tax expense. | ||||||||||||
Employee benefit plans | ||||||||||||
RealD has a voluntary 401(k) saving plans in which most U.S. employees are eligible to participate. Eligible employees may make contributions not to exceed the maximum statutory contribution amounts. The Company may match a percentage of each employee's contributions consistent with the provisions of the plan for which they are eligible. All employee and employer contributions fully vest immediately. The Company's contributions to these plans totaled $0.4 million, $0.6 million and $0.6 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
Recent accounting pronouncements | ||||||||||||
In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2014-09 Revenue from Contracts with Customers (Topic 606), effective for RealD starting April 1, 2017 (the first quarter of fiscal year 2018). Early application is not permitted. The new standard will be implemented retrospectively with the Company choosing to either restate prior periods or recognize the cumulative effect; the Company has not yet selected a transition method. | ||||||||||||
The new Topic 606 does not apply to lease contracts within the scope of Topic 840 Leases. The primary objective of ASU 2014-09 is to provide guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. This ASU will supersede the revenue recognition requirements in Topic 605 Revenue Recognition and most industry-specific guidance. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers, in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. Revenue recognition is anticipated to entail more judgment and more estimating than under the current guidance. ASU 2014-09 also changes Topic 360 Property, Plant and Equipment, Topic 350 Intangibles-Goodwill and Other and certain other U.S. GAAP. The Company has not yet determined the effects of Topic 606 and other ASU 2014-09 revisions on its consolidated financial statements. | ||||||||||||
In June 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-12, "Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period". ASU 2014-12 requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. This pronouncement is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and early adoption is permitted. The Company adopted the provisions of ASU 2014-12 in the third quarter of fiscal year 2015. The Company’s adoption is not expected to have any material impact on its consolidated financial statements. The Company already follows the accepted accounting within ASU 2014-12 for stock compensation terms within the scope of this clarifying guidance. | ||||||||||||
In February 2015,the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis”. The objective of ASU 2015-02 is to modify the consolidation requirements of Topic 810 to ensure that reporting entities do not consolidate other legal entities in situations where deconsolidation actually more accurately represents operational and economic results. Among other changes, the amendments to ASC 810 include lessening the relevance on fees paid to a decision-maker or service provider and the related party tiebreaker test.The amendments are effective for public business entities for fiscal years, and for interim periods within those fiscal years beginning after December 15, 2015. This ASU may be adopted using a full retrospective approach or a modified retrospective approach by recording a cumulative effect adjustment to equity as of the beginning of the fiscal year of adoption. ASU 2015-02 will be effective for the Company beginning in fiscal 2017, the Company has not yet determined the effects of ASU 2015-02 on its consolidated financial statements. | ||||||||||||
In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, "Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs", which changes the presentation of debt issuance costs in financial statements. Under the ASU 2015-03, such costs are presented in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. This pronouncement is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and early adoption is allowed for all entities for financial statements that have not been previously issued. The guidance is to be applied retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). ASU 2015-03 will be effective for the Company beginning in fiscal 2017. The Company elected not to early adopt and is currently evaluating the impact that the adoption of ASU 2015-03 may have on its consolidated financial statements. |
Cinema_Systems_and_Property_Eq
Cinema Systems and Property & Equipment | 12 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Property and equipment, RealD Cinema Systems and digital projectors | ||||||||
Cinema Systems and Property & Equipment | Cinema Systems and Property & Equipment | |||||||
Property and equipment, RealD Cinema Systems and digital projectors consist of the following: | ||||||||
(in thousands) | March 31, | March 31, | ||||||
2015 | 2014 | |||||||
RealD Cinema Systems | $ | 208,056 | $ | 205,416 | ||||
Digital projectors—held for sale | — | 216 | ||||||
Leasehold improvements | 16,974 | 16,935 | ||||||
Machinery and equipment | 5,791 | 4,753 | ||||||
Furniture and fixtures | 1,238 | 1,272 | ||||||
Computer equipment and software | 10,581 | 9,197 | ||||||
Construction in process | 565 | 1,554 | ||||||
Total | $ | 243,205 | $ | 239,343 | ||||
Less accumulated depreciation | (140,363 | ) | (110,060 | ) | ||||
Property and equipment, RealD Cinema Systems and digital projectors, net | $ | 102,842 | $ | 129,283 | ||||
Depreciation expense amounted to $38.6 million, $39.0 million and $32.7 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||
During the year ended March 31, 2015, the Company received $0.1 million in cash from motion picture exhibitor customers for the sale of digital projectors. | ||||||||
During the year ended March 31, 2014, the Company received $0.3 million in cash from motion picture exhibitor customers for the sale of digital projectors. | ||||||||
During the year ended March 31, 2013, the Company received $2.5 million in cash from motion picture exhibitor customers for the sale of digital projectors. | ||||||||
During the year ended March 31, 2013, the Company determined that a non-cancelable purchase commitment for certain cinema systems configurations in the aggregate amount of $3.5 million was not fully recoverable, primarily due to the initial investment costs which are expected to exceed the anticipated future cash flows for the related cinema systems. | ||||||||
For the years ended March 31, 2015, March 31, 2014 and March 31, 2013, impairment expense charged to cost of revenue totaled $5.0 million, $4.5 million and $8.7 million, respectively. |
Goodwill_and_other_intangibles
Goodwill and other intangibles, net | 12 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Goodwill and intangible assets, net | Goodwill and other intangibles, net | |||||||||||||||
Goodwill and other intangibles, net, consist of the following at: | ||||||||||||||||
31-Mar-15 | 31-Mar-14 | |||||||||||||||
(in thousands) | Gross | Accumulated | Gross | Accumulated | ||||||||||||
amount | amortization | amount | amortization | |||||||||||||
Acquired developed technologies | $ | 9,324 | $ | 4,507 | $ | 9,324 | $ | 3,170 | ||||||||
Goodwill | 10,657 | — | 10,657 | — | ||||||||||||
Total | $ | 19,981 | $ | 4,507 | $ | 19,981 | $ | 3,170 | ||||||||
Amortization expense amounted to $1.4 million, $1.3 million and $0.4 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||||||
In the fiscal year ended March 31, 2013, the Company purchased a portfolio of 2D-to-3D conversion patents in the amount of $6.1 million and may consider future purchases of intangible assets, acquisitions or other investing activities. | ||||||||||||||||
At March 31, 2015, the remaining amortization expense is estimated to be as follows (in thousands): | ||||||||||||||||
Fiscal year 2016 | $ | 1,303 | ||||||||||||||
Fiscal year 2017 | 1,300 | |||||||||||||||
Fiscal year 2018 | 1,287 | |||||||||||||||
Fiscal year 2019 | 306 | |||||||||||||||
Fiscal year 2020 | 129 | |||||||||||||||
Thereafter | 492 | |||||||||||||||
Total | $ | 4,817 | ||||||||||||||
Intangibles are deemed to have finite lives and consist of acquired developed technologies (which are primarily patents) and are amortized over their estimated useful lives of 5 to 19 years (with a weighted average remaining amortization period of 4.5 years) using the straight-line method. |
Accrued_expenses_and_other_lia
Accrued expenses and other liabilities | 12 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Payables and Accruals [Abstract] | ||||||||||||||||||||||||
Accrued expenses and other liabilities | Accrued expenses and other liabilities | |||||||||||||||||||||||
Accrued expenses and other liabilities consist of the following at: | ||||||||||||||||||||||||
(in thousands) | March 31, | March 31, | ||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Payroll and compensation | $ | 8,673 | $ | 5,070 | ||||||||||||||||||||
Sales, use taxes and other taxes | 6,317 | 6,582 | ||||||||||||||||||||||
Professional fees | 3,206 | 1,484 | ||||||||||||||||||||||
RealD Cinema system contractual obligations | 5,154 | 4,134 | ||||||||||||||||||||||
Other | 3,290 | 4,626 | ||||||||||||||||||||||
Total | $ | 26,640 | $ | 21,896 | ||||||||||||||||||||
For its U.S. and some of the international cinema license and product revenues, the Company absorbs the majority of the sales and use taxes and value added taxes and does not pass such costs on to its customers. | ||||||||||||||||||||||||
Cost reduction plans | ||||||||||||||||||||||||
Over the past few quarters, the Company announced plans to reduce the overall costs of its global operations (the "Cost Reduction Plans"). The Cost Reduction Plans were primarily a response to the anticipated impact on the Company’s financial results and operations caused by changes in the 3D box office performance of certain motion pictures due to perceived changes in consumer preference and the fact that the Company’s 3D cinema business is maturing in many markets like the United States in which the Company expected equipment installations to continue to slow. As part of the Cost Reduction Plans, the Company reduced its staff, rescoped and made other changes to certain research and development projects, reduced certain non-personnel related general and administrative expenses and streamlined certain manufacturing operations. The Company further focused the expansion of its global cinema platform on emerging growth markets and higher performing motion picture exhibitors. | ||||||||||||||||||||||||
The Company accounts for the Cost Reduction Plans in accordance with the Accounting Standards Codification, including ASC 420, Exit or Disposal Cost Obligations, ASC 712, Compensation-Nonretirement Postemployment Benefits, ASC 840, Leases and ASC 360, Property, Plant and Equipment (Impairment or Disposal of Long-Lived Assets). As a result of the Cost Reduction Plans' workforce reduction and commencement of the relocation of manufacturing, the Company incurred termination and other charges totaling approximately $4.7 million for the fiscal year ended March 31, 2014. Charges of $1.4 million have been incurred for the fiscal year ended March 31, 2015, including $0.3 million for the accrual of losses on a lease for manufacturing facilities that will no longer be used in the Company’s operations. Therefore, the total charges were $6.1 million through March 31, 2015. The following tables summarizes the charges resulting from implementation of the Cost Reduction Plans for the fiscal year ended March 31, 2015 and March 31, 2014: | ||||||||||||||||||||||||
Years ended March 31 | ||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
(in thousands) | Personnel | Leasehold | Total | Personnel | Leasehold | Total | ||||||||||||||||||
Cost of revenue | $ | 242 | $ | 601 | $ | 843 | $ | 835 | $ | 13 | $ | 848 | ||||||||||||
Research and development | 240 | — | 240 | 757 | — | 757 | ||||||||||||||||||
Selling and marketing | 97 | — | 97 | 1,830 | — | 1,830 | ||||||||||||||||||
General and administrative | 192 | — | 192 | 1,206 | 77 | 1,283 | ||||||||||||||||||
Total | $ | 771 | $ | 601 | $ | 1,372 | $ | 4,628 | $ | 90 | $ | 4,718 | ||||||||||||
The following table summarizes the actual and estimated activity resulting from implementation of the cost reduction plan with accrued expenses and other liabilities: | ||||||||||||||||||||||||
Cost reduction plan liabilities | ||||||||||||||||||||||||
(in thousands) | Personnel | Leasehold | Total | |||||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2013 | $ | — | $ | — | $ | — | ||||||||||||||||||
Charges | 4,628 | 90 | 4,718 | |||||||||||||||||||||
(Payments) | (3,212 | ) | (90 | ) | (3,302 | ) | ||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2014 | $ | 1,416 | $ | — | $ | 1,416 | ||||||||||||||||||
Charges | 771 | 601 | 1,372 | |||||||||||||||||||||
(Payments) | (938 | ) | (336 | ) | (1,274 | ) | ||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2015 | $ | 1,249 | $ | 265 | $ | 1,514 | ||||||||||||||||||
Additionally, the Company leases office space for its headquarters that includes approximately $5.6 million in leasehold improvements and other items classified as fixed assets (see Note 3 "Cinema Systems and Property & Equipment"). If the Company relocated the office, these fixed assets could become subject to an impairment assessment and contract termination costs or sublease loss could be incurred. | ||||||||||||||||||||||||
There is no guarantee that termination and implementation costs will not exceed the estimates, or that any net cost reduction will actually be achieved. |
Borrowings
Borrowings | 12 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Borrowings | Borrowings | |||||||
2014 Credit Agreement | ||||||||
On June 26, 2014, RealD entered into the Amended and Restated Credit Agreement (the "2014 Credit Agreement"), by and among the Company, as borrower, City National Bank, as administrative agent and letter of credit issuer ("City National"), the other agents from time to time party thereto and the lenders from time to time party thereto (the "Lenders"). The 2014 Credit Agreement amends and restates in its entirety that certain Credit Agreement, dated as of April 19, 2012, by and among the Company, City National and the agents and lenders from time to time party thereto, which had been most recently amended on October 16, 2013 (the "2012 Credit Agreement"). | ||||||||
Pursuant to the 2014 Credit Agreement, the Lenders thereunder made available to RealD: | ||||||||
• | a revolving credit facility (including a letter of credit sub-facility) in a maximum amount not to exceed $50 million (the "Revolving Facility"), which matures on June 26, 2017. In addition, we may request up to an additional $25 million of commitments under the Revolving Facility (such that the maximum amount of all commitments under the Revolving Facility may not exceed $75 million), subject to the satisfaction of certain financial and other conditions and subject to obtaining such commitments; and | |||||||
• | a delayed draw term loan facility in a maximum amount not to exceed $50 million (the "Term Loan Facility"), which matures on June 26, 2018. During the first quarter of fiscal year 2015, the Company borrowed $37.3 million under the Term Loan Facility, resulting in $12.7 million being available for future draws through June 26, 2015. | |||||||
Debt issuance costs related to the completion of the 2014 Credit Agreement totaled $0.9 million and were added to the $0.3 million deferred charge remaining on the 2012 Credit Agreement. As of March 31, 2015, unamortized debt issuance costs totaled $0.9 million. All these issuance costs are being amortized over the contractual life of the Revolving Facility and recorded as interest expense. | ||||||||
The obligations under the 2014 Credit Agreement are fully and unconditionally guaranteed by the Company’s subsidiaries, ColorLink Inc., a Delaware corporation ("ColorLink"), Stereographics Corporation, a California corporation ("Stereographics"), and RealD DDMG Acquisition, LLC, a Delaware limited liability company (together with the Company, ColorLink and Stereographics, the "Loan Parties"). The obligations under the 2014 Credit Agreement are secured by a first priority security interest in substantially all of the Loan Parties’ tangible and intangible assets. | ||||||||
As of March 31, 2015, $50 million was available under the Revolving Facility and $12.7 million was available under the Term Loan Facility after taking into account our borrowings under the Term Loan Facility during the first quarter of fiscal year 2015 in the amount of $37.3 million. As a result, as of March 31, 2015, we had $62.7 million available for future draws under the 2014 Credit Agreement. | ||||||||
As of March 31, 2015, there was no balance outstanding under the Revolving Facility. The term loan outstanding balance of $29.8 million at March 31, 2015 is to be repaid in 12 quarterly installments of $1.9 million through March 31, 2018 and the remaining $7.5 million principal on June 26, 2018. The current and non-current portions of the Credit Agreement due as of March 31, 2015 and March 31, 2014, which include both the 2012 Credit Agreement and 2014 Credit Agreement in the table below,were as follows: | ||||||||
March 31, | March 31, | |||||||
2015 | 2014 | |||||||
(in thousands) | ||||||||
Current portion of Credit Agreement | $ | 7,460 | $ | 12,500 | ||||
Credit Agreement, net of current portion | 22,380 | 23,750 | ||||||
Total Credit Agreement | $ | 29,840 | $ | 36,250 | ||||
At March 31, 2015, our future minimum Credit Agreement obligations were as follows: | ||||||||
Fiscal year 2016 | $ | 7,460 | ||||||
Fiscal year 2017 | 7,460 | |||||||
Fiscal year 2018 | 7,460 | |||||||
Fiscal year 2019 | 7,460 | |||||||
Total | $ | 29,840 | ||||||
Under the Credit Agreement, our business is subject to certain limitations, including limitations on our ability to incur additional debt, make certain investments or acquisitions, enter into certain merger and consolidation transactions, and sell our assets other than in the ordinary course of business. We are also required to maintain compliance with certain financial covenants, including a minimum fixed charge coverage ratio and a maximum leverage ratio. As of March 31, 2015, we were in compliance with all financial covenants in our Credit Agreement. If we fail to comply with any of the covenants or if any other event of default, as defined in our Credit Agreement, should occur, the bank lenders could elect to prevent us from borrowing and declare the indebtedness to be immediately due and payable. | ||||||||
Loans outstanding under the 2014 Credit Agreement bear interest at the Company’s option at either the Eurodollar rate plus a margin ranging from 2.25% to 2.75% per year or the base rate (the highest of (i) the Federal Funds rate plus 0.50%, (ii) City National’s prime rate or (iii) the Eurocurrency rate for a one month Interest Period on such day plus 1.00%) plus a margin ranging from 1.25% to 1.75% per year. The applicable margin for loans varies depending on the Company’s leverage ratio. Under the 2014 Credit Agreement, the Company is charged a commitment fee on the unused portions of the Revolving Facility and Term Loan Facility. The fee for the unused Revolving Facility varies between 0.250% and 0.375% per year depending on the percentage of the Revolving Facility in use. The fee for the unused Term Loan Facility is 0.375% of the unused commitment. Additionally, the Company is charged a letter of credit fee between 2.25% to 2.75%, depending on the Company’s leverage ratio, per year with respect to the amount of each performance letter of credit issued under the 2014 Credit Agreement. The Company also pays customary fronting fees and other fees and expenses in connection with the issuance of letters of credit under the 2014 Credit Agreement. | ||||||||
As of March 31, 2015, there were $29.8 million in borrowings outstanding in the 2014 Credit Agreement, borrowings outstanding under the 2014 Credit Agreement bore weighted average interest at 2.44%. As of March 31, 2014, there were $36.3 million in borrowings outstanding under the 2012 Credit Agreement. As of March 31, 2014, borrowings outstanding under the 2012 Credit Agreement bore interest at 2.88%. As of March 31, 2013, there were $47.5 million borrowings outstanding under the 2012 Credit Agreement. As of March 31, 2013, borrowings outstanding under the 2012 Credit Agreement bore interest at 3.03%. Interest expense related to our borrowings under our credit and security agreement was $1.6 million, $1.8 million and $1.1 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. |
Commitments_and_contingencies
Commitments and contingencies | 12 Months Ended | |||
Mar. 31, 2015 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
Commitments and contingencies | Commitments and contingencies | |||
Lease obligations | ||||
The Company leases certain office, production and research and development space under non-cancelable operating leases that expire at various dates. Certain operating leases provide the Company with the option to renew for additional periods. Where operating leases contain escalation clauses, rent abatements, and/or concessions, such as rent holidays and landlord or tenant incentives or allowances, the Company applies them in the determination of straight-line rent expense over the lease term. Certain operating leases require the payment of real estate taxes or other occupancy costs, which may be subject to escalation. | ||||
At March 31, 2015, the Company's future minimum lease obligations were as follows (in thousands): | ||||
Fiscal year 2016 | $ | 4,313 | ||
Fiscal year 2017 | 4,019 | |||
Fiscal year 2018 | 4,076 | |||
Fiscal year 2019 | 4,082 | |||
Fiscal year 2020 | 4,203 | |||
Thereafter | 10,710 | |||
Total | $ | 31,403 | ||
Rent expense was $6.8 million, $6.6 million and $5.2 million for the fiscal years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||
Indemnities and commitments | ||||
During the ordinary course of business, the Company makes certain indemnities and commitments under which it may be required to make payments in relation to certain transactions. These indemnities include indemnities of certain customers and licensees of our technologies, and indemnities to the Company’s directors and officers to the maximum extent permitted under the laws of the State of Delaware. The duration of these indemnities and commitments varies, and in certain cases, is indefinite. The majority of these indemnities and commitments do not provide for any limitation of the maximum potential future payments the Company could be obligated to make. The Company has not recorded any liability for these indemnities and commitments in the accompanying condensed consolidated balance sheets. The Company does, however, accrue for losses for any known contingent liability, including those that may arise from indemnification provisions, when future payment is reasonably probable and estimable. | ||||
The Company has entered into contracts with certain of our vendors. Future obligations under such contracts totaled $13.7 million at March 31, 2015 and include revolving 90-day supply commitments and other professional service commitments. Many of the contracts contain cancellation penalty provisions requiring payment of up to 20.0% of the unused contract. | ||||
Contingencies and assessments | ||||
The Company is subject to various loss contingencies and assessments arising in the course of its business, some of which relate to litigation, claims, property taxes and sales and use tax or goods and services tax assessments. The Company considers the likelihood of the loss or the incurrence of a liability, as well as the Company’s ability to reasonably estimate the amount of loss in determining loss contingencies and assessments. An estimated loss contingency or assessment is accrued when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. The Company regularly evaluates current information available to us to determine whether such accruals should be adjusted. Based on the information presently available, including discussion with counsel and other consultants, management believes that resolution of these matters will not have a material adverse effect on the Company’s business, consolidated results of operations, financial condition or cash flows. |
Equity
Equity | 12 Months Ended | ||
Mar. 31, 2015 | |||
Equity [Abstract] | |||
Equity | Equity | ||
Common stock | |||
At March 31, 2015, the Company reserved the following shares of common stock for future issuances in connection with: | |||
(in thousands) | |||
Restricted stock units | 1,524 | ||
Performance stock options | 236 | ||
Performance stock units | 1,029 | ||
Stock option plan: | |||
Outstanding | 6,804 | ||
Reserved for future issuance | 5,965 | ||
Total | 15,558 | ||
Stock repurchase program | |||
On April 20, 2012, the Company announced that its board of directors had approved an authorization to repurchase up to $50.0 million of RealD common stock. On December 14, 2012, the Company's board of directors approved a $25 million increase in its stock repurchase plan, increasing the $50 million repurchase plan announced on April 20, 2012 to $75 million. The number of shares to be repurchased and the timing of any potential repurchases will depend on factors such as the Company's stock price, economic and market conditions, alternative uses of capital, and corporate and regulatory requirements. Repurchases of common stock may be made under a Rule 10b5-1 plan, which would permit common stock to be repurchased when RealD might otherwise be precluded from doing so under insider trading laws, and a variety of other methods, including open market purchases, privately negotiated transactions, block trades, accelerated share repurchase transactions, or by any combination of such methods. The repurchase program may be suspended or discontinued at any time. | |||
Pursuant to RealD's stock repurchase plan authorized by its board of directors, the Company have repurchased a total of 6,599,726 shares of common stock at an average price per share of $10.30, including sales commissions, for an aggregate cost of $67.9 million inception to date. For the fiscal year ended March 31, 2015, the Company did not make any repurchases. For the fiscal year ended March 31, 2014, the Company repurchased a total of 671,997 shares of common stock at an average price per share of $11.18, including sales commissions, for an aggregate cost of $7.5 million. For the fiscal year ended March 31, 2013, the Company repurchased a total of 5,927,729 shares of common stock at an average price per share of $10.20, including sales commissions, for an aggregate cost of $60.4 million. |
Sharebased_compensation
Share-based compensation | 12 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
Share-based compensation | Share-based compensation | ||||||||||||
The Company accounts for share-based payment awards granted to employees and directors by recording compensation expense based on estimated fair values. The Company estimates the fair value of share-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in the Company’s consolidated statements of operations. Share-based awards are attributed to expense using the straight-line method over the vesting period. The Company determines the value of each option award that contains a market condition using a Monte Carlo Simulation valuation model, while all other option awards are valued using the Black-Scholes valuation model as permitted under ASC 718, Compensation — Stock Compensation. The assumptions used in calculating the fair value of share-based payment awards represent the Company’s best estimates. The Company’s estimates of the fair values of stock options granted and the resulting amounts of share-based compensation recognized may be impacted by certain variables including stock price volatility, employee stock option exercise behaviors, additional stock option modifications, estimates of forfeitures, and the related income tax impact. | |||||||||||||
In April 2010, the Company's board of directors unanimously adopted the RealD Inc. 2010 Stock Incentive Plan (the "2010 Stock Plan"), and in June 2010, the Company's stockholders approved the 2010 Stock Plan. The board of directors intends for the 2010 Stock Plan to replace our 2004 Amended and Restated Stock Incentive Plan, (the "2004 Plan"), such that, effective with our IPO, the Company will no longer make any new grants under the 2004 Plan. Instead, the board of directors or the Company's compensation committee will issue equity compensation awards under the 2010 Stock Plan. The stock plan provides for the granting of nonstatutory stock options, incentive stock options, stock appreciation rights, restricted stock awards and performance stock units to employees, officers, directors, non-employee directors and consultants. Additionally, in June 2011 the Company's board of directors approved the RealD Inc. 2011 Employee Stock Purchase Plan (the "ESPP Plan") and in July 2011, the Company's stockholders approved the ESPP Plan. Stock-based compensation expense related to the ESPP Plan for the year ended March 31, 2015 was $0.1 million. | |||||||||||||
The following table reflects the components of share-based compensation expense recognized in the Company's consolidated statements of operations for the years ended March 31, 2015, March 31, 2014 and March 31, 2013: | |||||||||||||
Years ended March 31 | |||||||||||||
(in thousands) | 2015 | 2014 | 2013 | ||||||||||
Cost of revenue | $ | 1,212 | $ | 865 | $ | 807 | |||||||
Research and development | 3,227 | 2,708 | 2,185 | ||||||||||
Selling and marketing | 3,017 | 5,543 | 5,258 | ||||||||||
General and administrative | 7,442 | 8,625 | 10,224 | ||||||||||
Total | $ | 14,898 | $ | 17,741 | $ | 18,474 | |||||||
Stock options | |||||||||||||
Stock options granted generally vest over a four-year period, with 25% of the shares vesting after one year and monthly vesting thereafter. The options generally expire ten years from the date of grant. Share-based compensation expense related to stock options was $7.2 million, $13.8 million and $14.2 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||||||||||||
A summary of the Company's stock option activity is as follows: | |||||||||||||
(in thousands, except exercise price | Options | Weighted- | Weighted- | Aggregate | |||||||||
data and contractual term data) | average | average | intrinsic | ||||||||||
exercise | remaining | value | |||||||||||
price | contractual | ||||||||||||
term (years) | |||||||||||||
Outstanding at March 31, 2014 | 7,811 | $ | 13.11 | ||||||||||
Granted | 602 | 11.25 | |||||||||||
Exercised | (779 | ) | 4.58 | ||||||||||
Forfeited or expired | (830 | ) | 15.08 | ||||||||||
Outstanding at March 31, 2015 | 6,804 | $ | 13.68 | 5.6 | $ | 14,309 | |||||||
Exercisable at March 31, 2015 | 5,689 | $ | 13.97 | 5.1 | $ | 11,486 | |||||||
Vested or expected to vest | 6,694 | $ | 13.76 | 5.6 | $ | 13,083 | |||||||
The total intrinsic value of options exercised was $6.4 million, $4.9 million and $2.6 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||||||||||||
Awards that are vested or expected to vest take into consideration estimated forfeitures for awards not yet vested. | |||||||||||||
The weighted-average grant date fair values were determined using the Black- Scholes option-pricing model with the following weighted-average assumptions: | |||||||||||||
Years ended March 31 | |||||||||||||
2015 | 2014 | 2013 | |||||||||||
Fair value of stock options granted | $ | 5.9 | $ | 7.2 | $ | 6.2 | |||||||
Expected volatility | 55 | % | 60 | % | 60 | % | |||||||
Expected term (years) | 6 | 6 | 6 | ||||||||||
Risk-free rate | 1.2 | % | 1.4 | % | 1 | % | |||||||
Expected dividends | — | — | — | ||||||||||
For purposes of determining the expected term and in the absence of historical data relating to stock option exercises, the Company applies a simplified approach: the expected term of awards granted is presumed to be the mid-point between the vesting date and the end of the contractual term. The Company uses the contractual term when valuing awards to consultants. For fiscal year ended March 31, 2015, the Company uses the annual volatility of its daily closing price for expected volatility. For fiscal years ended March 31, 2014 and March 31, 2013, the Company used the average volatility of similar, publicly traded companies as an estimate for expected volatility. The risk-free interest rate for periods within the expected or contractual life of the option, as applicable, is based on the United States Treasury yield curve in effect during the period the options were granted. The Company's expected dividend yield is zero. | |||||||||||||
As of March 31, 2015, there was $7.0 million of total unrecognized compensation costs related to stock option compensation arrangements granted which is expected to be recognized over the remaining weighted-average period of 2.14 years. | |||||||||||||
Performance stock options | |||||||||||||
Certain of the Company’s management-level employees receive performance stock options, which gives the recipient the right to receive common stock that is contingent upon achievement of specified pre-established performance goals over the performance period, which is generally three years subject to the recipient’s continued service with the Company. The performance goals for the performance stock options are based on the measurement of the Company’s total stockholder return, on a percentile basis, compared to a comparable group of companies. Depending on the outcome of the performance goals, the recipient may ultimately earn performance stock options equal to or less than the number of performance stock options granted. In June 2013, the Company’s Chief Executive Officer’s fiscal year 2013 stock option grant was amended to retroactively change the vesting schedule of the stock option so that it now vests based upon the achievement of performance goals rather than based solely upon Mr. Lewis’ continued service with the Company. The performance goal is based on the measurement of the Company’s total stockholder return, on a percentile basis, compared to a comparable group of companies. The performance period for this performance stock option is between three and five years. For the years ended March 31, 2015, March 31, 2014 and March 31, 2013, share-based compensation expense related to performance stock options was $0.7 million, $0.5 million and $1.9 million, respectively. | |||||||||||||
The Monte Carlo Simulation valuation model uses terms based on the length of the performance period and compound annual growth rate goals for total stockholder return based on the provisions of the award. For purposes of determining the expected term and in the absence of historical data relating to stock option exercises, the Company applies a simplified approach: the expected term of awards granted is presumed to be the mid-point between the vesting date and the end of the contractual term. The Company uses the average volatility of a peer group of companies as an estimate for expected volatility. The risk-free interest rate for periods within the expected or contractual life of the option, as applicable, is based on the United States Treasury yield curve in effect during the period the options were granted. | |||||||||||||
A summary of the Company's performance stock option activity is as follows: | |||||||||||||
(in thousands, except exercise price | Options | Weighted- | Weighted- | ||||||||||
data and contractual term data) | average | average | |||||||||||
exercise | remaining | ||||||||||||
price | contractual | ||||||||||||
term (years) | |||||||||||||
Outstanding at March 31, 2014 | 686 | $ | 14.98 | 7.3 | |||||||||
Granted | — | — | 0 | ||||||||||
Exercised | — | — | 0 | ||||||||||
Forfeited or expired | — | — | 0 | ||||||||||
Outstanding at March 31, 2015 | 686 | $ | 14.98 | 6.3 | |||||||||
Performance stock units | |||||||||||||
Certain of the Company’s management-level employees also receive performance stock units, which gives the recipient the right to receive common stock that is contingent upon achievement of specific pre-established performance goals over the performance period, which is generally two years subject to the recipient’s continued service with us. The performance goals are based on achieving certain levels of total licensing revenue over the performance period. Depending on the outcome of the performance goals, the recipient may ultimately earn performance stock units between 0% and 200% of the number of performance stock units granted. For the year ended March 31, 2015, share-based compensation expense related to performance stock units was $1.5 million. For year ended March 31, 2014, share-based compensation expense related to performance stock units was $3.3 million. For the year ended March 31, 2013, there was no share-based compensation expense related to performance stock units. | |||||||||||||
(in thousands, except exercise price | Units | Weighted- | |||||||||||
data and contractual term data) | average | ||||||||||||
grant date | |||||||||||||
fair value | |||||||||||||
Nonvested at March 31, 2014 | 668 | $ | 14.96 | ||||||||||
Granted | 652 | 11.46 | |||||||||||
Vested | (129 | ) | 11.46 | ||||||||||
Forfeited or cancelled | (741 | ) | 14.15 | ||||||||||
Nonvested at March 31, 2015 | 450 | $ | 12.23 | ||||||||||
Restricted stock units | |||||||||||||
Certain of the Company’s employees, including certain management level employees, receive time-based restricted stock units. These restricted stock units vest over one to three years based upon a recipient's continued service with the Company. For the year ended March 31, 2015, the Company granted 1.3 million restricted stock units at a weighted average grant date fair value of $11.27 per restricted stock unit. For the year ended March 31, 2014, the Company granted 0.6 million restricted stock units at a weighted average grant date fair value of $12.29 per restricted stock unit. For the years ended March 31, 2015 and March 31, 2014, respectively, share- based compensation expense related to restricted stock units was $5.3 million and $3.3 million, respectively. | |||||||||||||
The following summarizes select information regarding the Company's restricted stock units during the year ended March 31, 2015: | |||||||||||||
(in thousands, except grant | Units | Weighted- | |||||||||||
date fair value data) | average | ||||||||||||
grant date | |||||||||||||
fair value | |||||||||||||
Nonvested at March 31, 2014 | 479 | $ | 13.13 | ||||||||||
Granted | 1,303 | 11.27 | |||||||||||
Vested | (327 | ) | 12.16 | ||||||||||
Forfeited or cancelled | (215 | ) | 11.61 | ||||||||||
Nonvested at March 31, 2015 | 1,240 | $ | 11.69 | ||||||||||
As of March 31, 2015, there was $14.5 million of total unrecognized compensation costs related to restricted stock units granted which is expected to be recognized over the remaining weighted-average period of 3.1 years. | |||||||||||||
The total fair values of restricted stock units that vested was $4.0 million, $2.5 million and $2.2 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. |
Income_taxes
Income taxes | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Income taxes | Income taxes | |||||||||||
The income tax provision from continuing operations for the fiscal years ended March 31, 2015, March 31, 2014 and March 31, 2013 consists of the following: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Current income tax provision: | ||||||||||||
Federal | $ | — | $ | — | $ | — | ||||||
State | 47 | 132 | 103 | |||||||||
Foreign | 7,458 | 6,128 | 5,202 | |||||||||
7,505 | 6,260 | 5,305 | ||||||||||
Deferred income tax benefit: | ||||||||||||
Federal | — | — | — | |||||||||
State | — | — | — | |||||||||
Foreign | 404 | (143 | ) | (241 | ) | |||||||
Total income tax provision from continuing operations | $ | 7,909 | $ | 6,117 | $ | 5,064 | ||||||
Income (loss) from continuing operations before income taxes consisted of the following: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
United States | $ | (23,020 | ) | $ | (11,224 | ) | $ | (6,963 | ) | |||
Foreign | 7,182 | 6,131 | 2,140 | |||||||||
Total | $ | (15,838 | ) | $ | (5,093 | ) | $ | (4,823 | ) | |||
Significant components of the Company's deferred tax balances are as follows: | ||||||||||||
(in thousands) | March 31, | March 31, | ||||||||||
2015 | 2014 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss carryforwards | $ | 28,180 | $ | 24,971 | ||||||||
Deferred revenues | 1,288 | 2,708 | ||||||||||
Accruals, reserves and allowances | 6,828 | 7,698 | ||||||||||
Stock compensation | 16,936 | 15,796 | ||||||||||
Foreign tax credit carryovers | 18,781 | 15,181 | ||||||||||
Partnership interest | 6 | 44 | ||||||||||
Other | 1,353 | 1,445 | ||||||||||
Total deferred tax assets | $ | 73,372 | $ | 67,843 | ||||||||
Deferred tax liabilities | ||||||||||||
Fixed assets | $ | (12,876 | ) | $ | (15,020 | ) | ||||||
Intangible assets | (150 | ) | (118 | ) | ||||||||
Unbilled receivables | (3,230 | ) | (5,821 | ) | ||||||||
Other | (565 | ) | (426 | ) | ||||||||
Total deferred tax liabilities | $ | (16,821 | ) | $ | (21,385 | ) | ||||||
Valuation allowance | $ | (56,673 | ) | $ | (46,175 | ) | ||||||
Net deferred tax assets (liabilities) | $ | (122 | ) | $ | 283 | |||||||
Due to the uncertainties surrounding the timing and realization of the benefits from our tax attributes in future tax returns, the Company has placed a valuation allowance against primarily all of our otherwise recognizable net deferred tax assets as of March 31, 2015 and March 31, 2014. As a result, the Company increased its valuation allowance through the operating statement as follows: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | ||||||||||
Through continuing operation | $ | 10,498 | $ | 7,091 | ||||||||
Increase in valuation allowance | $ | 10,498 | $ | 7,091 | ||||||||
The income tax provision from continuing operations differs from the amount computed by applying the U.S. statutory federal income tax rate of 34% to the pretax income (loss) as a result of the following differences: | ||||||||||||
Years ended March 31 | ||||||||||||
2015 | 2014 | 2013 | ||||||||||
Federal tax at statutory rate | 34 | % | 34 | % | 34 | % | ||||||
State tax, net of federal benefit | 2.7 | % | (1.4 | )% | (7.7 | )% | ||||||
Foreign tax rate differential | 4.5 | % | 8.6 | % | 2.9 | % | ||||||
LLC income minority interest not taxed | 0.2 | % | 1.4 | % | (1.3 | )% | ||||||
Revaluation of deferred taxes due to changes in effective income tax rates | (0.6 | )% | (0.8 | )% | 3.8 | % | ||||||
Foreign withholding taxes (credits) | — | % | (0.9 | )% | — | % | ||||||
Permanent differences and other | (17.8 | )% | 15.2 | % | 3.7 | % | ||||||
Stock compensation | (4.5 | )% | (37.0 | )% | (34.9 | )% | ||||||
Change in valuation allowance | (68.4 | )% | (139.0 | )% | (105.5 | )% | ||||||
Total tax benefit | (49.9 | )% | (119.9 | )% | (105.0 | )% | ||||||
As of March 31, 2015, the Company had net operating loss carryforwards of approximately $133.7 million for federal and $70.1 million for state purposes. Federal and state net operating loss carryforwards begin to expire in year 2027 and 2016, respectively. As of March 31, 2015, the Company had foreign tax credit carryforwards of approximately $18.8 million for federal income tax purposes that begin to expire in the year 2019. | ||||||||||||
The U.S. Internal Revenue Code of 1986, as amended, generally imposes an annual limitation on a corporation's ability to utilize net operating loss carryovers ("NOLs") if it experiences an ownership change as defined in Section 382. In general terms, an ownership change may result from transactions increasing the ownership of certain stockholders in the stock of a corporation by more than 50% over a three year period. In the event that an ownership change has occurred, or were to occur, utilization of the Company's NOLs would be subject to an annual limitation under Section 382 as determined by multiplying the value of the Company's stock at the time of the ownership change by the applicable long-term tax-exempt rate as defined in the Internal Revenue Code. Any unused annual limitation may be carried over to later years. The Company could experience an ownership change under Section 382 as a result of events in the past in combination with events in the future. If so, the use of the Company's NOLs, or a portion thereof, against future taxable income may be subject to an annual limitation under Section 382, which may result in expiration of a portion of the NOLs before utilization. To the extent the Company's use of net operating loss carryforwards is significantly limited under the rules of Section 382 (as a result of our IPO or otherwise), its income could be subject to U.S. corporate income tax earlier than it would if it was able to use net operating loss carryforwards, which would result in lower profits. Any carry-forwards that expire prior to utilization as a result of such limitations will be removed, if applicable, from deferred tax assets with a corresponding reduction of the valuation allowance. | ||||||||||||
The Company recognizes excess tax benefits associated with share-based compensation and motion picture exhibitor options to stockholders' equity only when realized. As of March 31, 2015, the Company has approximately $23.0 million of unrealized excess tax benefits associated with share-based compensation and exhibitor options. These tax benefits will be accounted for as a credit to additional paid-in capital, if and when realized, rather than a reduction of the provision for income taxes. | ||||||||||||
The Company adopted accounting for uncertain tax positions pursuant to ASC 740, Income Taxes. The following table summarizes the activity related to our unrecognized tax benefits (in thousands): | ||||||||||||
Balance as of March 31, 2014 | $ | 346 | ||||||||||
Increases related to prior year tax positions | — | |||||||||||
Increase related to current year tax positions | — | |||||||||||
Expiration of the statute of limitations for the assessment of taxes | — | |||||||||||
Settlements | — | |||||||||||
Balance as of March 31, 2015 | $ | 346 | ||||||||||
Approximately $0.3 million of the unrecognized tax benefits will decrease the effective tax rate if recognized, subject to the valuation allowance. | ||||||||||||
It is not anticipated that there will be a significant change in the unrecognized tax benefits over the next 12 months. | ||||||||||||
Due to the net operating loss carryforwards, our United States federal and state returns are open to examination by the Internal Revenue Service and state jurisdictions for all years since inception. | ||||||||||||
The Company's policy is to recognize interest expense and penalties related to income tax matters as a component of income tax expense. As of March 31, 2015, amounts for accrued interest and penalties associated with uncertain tax positions were not significant. | ||||||||||||
On September 13, 2013, the U.S. Treasury Department released final income tax regulations on the deduction and capitalization of expenditures related to tangible property. These final regulations apply to tax years beginning on or after January 1, 2014. The tangible property regulations required the Company to make additional tax accounting method changes for its tax return year ended March 31, 2015. The impact of these changes was not material to its consolidated financial statements. | ||||||||||||
As of March 31, 2015, unremitted earnings of the subsidiary outside of the United States were approximately $38.5 million, on which no United States taxes had been provided. The Company's current intention is to reinvest these earnings outside the United States. It is not practicable to estimate the amount of additional taxes that might be payable upon repatriation of foreign earnings. |
Relatedparty_transactions
Related-party transactions | 12 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related-party transactions | Related-party transactions |
On May 19, 2011, the Company entered into a separation agreement and general release of claims with Joshua Greer, a former director and executive officer of the Company. Pursuant to the terms of the separation agreement, Mr. Greer received the following benefits: (i) cash severance of $450,000 paid in 10 equal installments, with the first such installment paid on October 15, 2011; (ii) reimbursement from us for insurance coverage under COBRA for 18 months following July 15, 2011 or such earlier time as Mr. Greer becomes eligible for insurance through another employer; (iii) a pro-rated cash performance bonus for fiscal year 2012 (to be paid no later than June 15, 2012), in an amount equal to 30% of 80% of Mr. Greer's salary, computed assuming that Mr. Greer had remained as our president through the end of fiscal year 2012; and (iv) acceleration of a time-based vesting stock option for 105,000 shares granted to Mr. Greer on July 15, 2010 as of July 15, 2011, which remained exercisable for six months following the end of the term of the consulting agreement that we entered into with Mr. Greer on the same date. A second stock option for 105,000 shares granted to Mr. Greer on July 15, 2010 was entirely forfeited and cancelled without consideration. The Company entered into a consulting agreement with Mr. Greer pursuant to which Mr. Greer was paid $275,000 per year commencing as of July 16, 2011. The consulting agreement with Mr. Greer expired on July 16, 2012. On June 21, 2012, Mr. Greer notified us of his resignation from our board of directors, effective on July 16, 2012 upon the expiration of the consulting agreement. During the year ended March 31, 2013, the Company paid Mr. Greer $225,000 pursuant to his separation agreement and $148,958 pursuant to his consulting agreement. | |
The Company entered into a consulting agreement, effective as of May 29, 2012 (the "DCH Agreement"), with DCH Consultants LLC ("DCH"), an entity controlled by Mr. David Habiger. Mr. Habiger is a member of the Company's Board of Directors, its Nominating and Corporate Governance Committee and its Compensation Committee. | |
Pursuant to the DCH Agreement, DCH provided certain consulting services regarding the application of one or more of our technologies in the consumer electronics industry. The DCH Agreement had a term of 4 months and DCH was entitled to receive aggregate fixed compensation of $20,000 per month during the term of the DCH Agreement. Although we had the right to extend the engagement for up to two additional months on the same terms, by providing DCH with 10 days written notice prior to the end of the original term, we did not extend the DCH Agreement and it expired as of September 29, 2012. | |
During the fiscal year ended March 31, 2013, the Company paid DCH $80,239 pursuant to the DCH Agreement. | |
During the fiscal year ended March 31, 2015 and March 31, 2014, there were no related party transactions. |
Segment_and_geographic_informa
Segment and geographic information | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Segment and geographic information | Segment and geographic information | |||||||||||
For financial reporting purposes the Company currently has one reportable segment. The Company has three operating segments: cinema, consumer electronics and professional. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. The Company's chief operating decision maker is its Chief Executive Officer. The Company aggregates its three operating segments into one reportable segment based on qualitative factors including similar economic characteristics and the nature of the products and services. The Company's product portfolio is used in applications that enable a premium 3D viewing experience. The Company currently generates substantially all of its revenue from the license of its RealD Cinema Systems and the sale of its eyewear, which together enable a digital projector to show 3D motion of pictures. | ||||||||||||
The Company's top 10 customers with an accounts receivable balance represented approximately 25% and 47% of its net accounts receivable as of March 31, 2015 and March 31, 2014, respectively. The Company's top 10 customers accounted for approximately 55%, 46% and 44% of its revenue for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | ||||||||||||
As of March 31, 2015, the Company had two licensees that accounted for more than 10% of its gross license revenue, one of which accounted for 15% and the other 11%. As of March 31, 2014, the Company had two licensees that accounted for more than 10% of its gross license revenue, one of which accounted for 14% and the other 13%. No licensee accounted for more than 10% of our gross license revenue in fiscal year 2013. | ||||||||||||
Geographic information | ||||||||||||
Revenue by geographic region, as determined based on the location of the Company's customers or the anticipated destination of use was as follows: | ||||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Domestic (United States and Canada) | $ | 71,081 | $ | 96,159 | $ | 106,979 | ||||||
China | 19,243 | 16,642 | 8,615 | |||||||||
Rest of the world | 73,139 | 86,433 | 99,958 | |||||||||
Total revenues | $ | 163,463 | $ | 199,234 | $ | 215,552 | ||||||
Long-lived tangible assets, net of accumulated depreciation, by geographic region were as follows: | ||||||||||||
(in thousands) | March 31, | March 31, | ||||||||||
2015 | 2014 | |||||||||||
Domestic (United States and Canada) | $ | 87,134 | $ | 105,708 | ||||||||
China | 10,185 | 8,085 | ||||||||||
Rest of the world | 5,523 | 15,490 | ||||||||||
Total long-lived tangible assets | $ | 102,842 | $ | 129,283 | ||||||||
Quarterly_financial_data_unaud
Quarterly financial data (unaudited) | 12 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Quarterly financial data (unaudited) | Quarterly financial data (unaudited) | |||||||||||||||
Three months ended | ||||||||||||||||
March 31, | December 31, | September 30, | June 30, | |||||||||||||
2015 | 2014 | 2014 | 2014 | |||||||||||||
(Dollars in thousands, except per share data) | -1 | -1 | ||||||||||||||
Net revenue | $ | 27,905 | $ | 32,571 | $ | 47,768 | $ | 55,219 | ||||||||
Gross profit | 10,242 | 14,963 | 25,552 | 30,021 | ||||||||||||
Net income (loss) | (17,635 | ) | (11,290 | ) | (751 | ) | 5,929 | |||||||||
Net income (loss) attributable to RealD Inc. common stockholders | $ | (17,710 | ) | $ | (11,290 | ) | $ | (751 | ) | $ | 5,929 | |||||
Earning (loss) per common shares: | ||||||||||||||||
Basic | $ | (0.36 | ) | $ | (0.23 | ) | $ | (0.02 | ) | $ | 0.12 | |||||
Diluted | $ | (0.36 | ) | $ | (0.23 | ) | $ | (0.02 | ) | $ | 0.11 | |||||
_______________________________________________________________________________ | ||||||||||||||||
-1 | During the third quarter of fiscal year 2015, the Company identified certain errors and, accordingly, performed additional analyses and supplementary review procedures, following the guidance of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 250 Accounting Changes and Error Corrections and the Securities and Exchange Commission (SEC) Staff Accounting Bulletin Topic 1 Financial Statements. Upon completion of these procedures, the Company concluded that the effects of the errors were not material to any prior year previously reported amounts but are material to previously reported interim amounts for the first and second quarters of the current fiscal year. Accordingly, in the third quarter ended December 31, 2014 Form 10-Q, the Company restated certain previously reported interim condensed consolidated balance sheet, condensed consolidated statements of operations and condensed consolidated statements of cash flows amounts to correct these errors (also see Note 2, "Effect of certain correction on certain financial statements" from the Quarterly Report on Form 10-Q for the quarter ended December 31, 2014). | |||||||||||||||
Three months ended | ||||||||||||||||
(Dollars in thousands, except per share data) | March 31, | December 31, | September 30, | June 30, | ||||||||||||
2014 | 2013 | 2013 | 2013 | |||||||||||||
Net revenue | $ | 40,648 | $ | 55,438 | $ | 43,929 | $ | 59,219 | ||||||||
Gross profit | 19,902 | 27,270 | 19,906 | 28,181 | ||||||||||||
Net loss | (4,855 | ) | (155 | ) | (4,664 | ) | (1,536 | ) | ||||||||
Net loss attributable to RealD Inc. common stockholders | $ | (4,950 | ) | $ | (271 | ) | $ | (4,651 | ) | $ | (1,534 | ) | ||||
Loss per common share: | ||||||||||||||||
Basic | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.03 | ) | ||||
Diluted | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.03 | ) | ||||
Years ended March 31 | ||||||||||||||||
(Number of calendar days) | 2015 | 2014 | Number of | Percentage | ||||||||||||
days change | change | |||||||||||||||
1st fiscal quarter | 91 | 91 | — | — | % | |||||||||||
2nd fiscal quarter | 92 | 92 | — | — | % | |||||||||||
3rd fiscal quarter | 92 | 92 | — | — | % | |||||||||||
4th fiscal quarter | 90 | 90 | — | — | % | |||||||||||
Total number of calendar days | 365 | 365 | — | — | % | |||||||||||
Years ended March 31 | ||||||||||||||||
(Number of calendar days) | 2014 | 2013 | Number of | Percentage | ||||||||||||
days change | change | |||||||||||||||
1st fiscal quarter | 91 | 91 | — | — | % | |||||||||||
2nd fiscal quarter | 92 | 91 | 1 | 1.1 | % | |||||||||||
3rd fiscal quarter | 92 | 101 | (9 | ) | (8.9 | )% | ||||||||||
4th fiscal quarter | 90 | 90 | — | — | % | |||||||||||
Total number of calendar days (1) | 365 | 373 | (8 | ) | (2.1 | )% | ||||||||||
_______________________________________________________________________________ | ||||||||||||||||
-1 | Represents total number of calendar days difference between fiscal year 2014 and 2013 (also see "Accounting period" caption under Note 2, "Summary of significant accounting policies"). |
SCHEDULE_IIVALUATION_AND_QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ||||||||||||||||
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | |||||||||||||||
Balance at | Additions | Other | Balance at end | |||||||||||||
beginning of | charged to | Adjustments/ | of period (2) | |||||||||||||
period | cost and | Deductions(1) | ||||||||||||||
expenses | ||||||||||||||||
Allowance for doubtful accounts and customer credits: | ||||||||||||||||
Year ended March 31, 2015 | $ | 4,086 | $ | 4,701 | $ | (2,922 | ) | $ | 5,865 | |||||||
Year ended March 31, 2014 | $ | 2,649 | $ | 2,389 | $ | (952 | ) | $ | 4,086 | |||||||
Year ended March 31, 2013 | $ | 4,224 | $ | — | $ | (1,575 | ) | $ | 2,649 | |||||||
Deferred tax valuation allowance: | ||||||||||||||||
Year ended March 31, 2015 | $ | 46,175 | $ | 10,498 | $ | — | $ | 56,673 | ||||||||
Year ended March 31, 2014 | $ | 39,084 | $ | 7,091 | $ | — | $ | 46,175 | ||||||||
Year ended March 31, 2013 | $ | 33,994 | $ | 5,090 | $ | — | $ | 39,084 | ||||||||
_______________________________________________________________________________ | ||||||||||||||||
-1 | Other adjustments and deductions primarily consist of adjustments to deferred revenue and write-offs of amounts previously charged to the provision. | |||||||||||||||
-2 | Balance at March 31, 2014 was misstated in the Annual Report on Form 10-K for the fiscal year ended March 31, 2014, which did not result in any financial statement adjustments. The schedule above reflects the corrected balance. | |||||||||||||||
-3 | List of Exhibits | |||||||||||||||
The Exhibits filed as part of this Annual Report on Form 10-K, or incorporated by reference, are listed on the Exhibit Index immediately preceding such Exhibits, which Exhibit Index is incorporated herein by reference. |
Summary_of_significant_account1
Summary of significant accounting policies (Policies) | 12 Months Ended | ||
Mar. 31, 2015 | |||
Accounting Policies [Abstract] | |||
Accounting period | Accounting period | ||
On November 14, 2012, RealD's Board of Directors approved a change in our accounting periods from the previous configuration of four 13-week periods for a total of 52 weeks to a calendar month end and calendar quarter end accounting period. This change in accounting period commenced in the third quarter ended December 31, 2012 of fiscal year 2013. As a result, the years ended March 31, 2015 and 2014 are eight days shorter (2.1%) than the year ended March 31, 2013. | |||
Use of estimates | . | ||
Use of estimates | |||
The preparation of 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 applicable disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. The most significant estimates made by management in the preparation of the financial statements relate to the following: | |||
• | licensing revenue terms applied to the timing and number of motion picture exhibitor consumer admissions; | ||
• | domestic eyewear product revenue terms applied to when the usage occurs and the amount of usage; | ||
• | effects of allowances that are capitalized on the balance sheet and amortized to the applicable line item on the statement of operations as expense or contra revenue and earned customer incentives when customers do not timely report the activity that results in earned allowances and incentives; | ||
• | customer contract terms on revenue and balance sheet items; | ||
• | impairment testing of goodwill, intangible assets and tangible assets, including determination of relevant reporting units and long-lived asset groups; | ||
• | useful lives of intangible assets and tangible assets; | ||
• | timing and amount recognized for performance-based compensation, including bonus, executive salary and executive restricted share units, based on projections of Company performance achievement; | ||
• | the impact of potential future tax consequences of events that have been recognized in the Company’s financial statements; | ||
• | valuation of accruals and allowances; | ||
• | contingency assessments; and | ||
• | assumptions used in the determination of the fair value of equity-based awards for stock-based compensation. | ||
Earnings (loss) per share of common stock | Earnings (loss) per share of common stock | ||
Basic income per share of common stock is computed by dividing the net income (loss) attributable to RealD common stockholders for the period by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per common share is computed by dividing net income (loss) attributable to RealD Inc. common stockholders by the weighted-average number of shares of common stock outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include outstanding stock options, shares to be purchased under our employee stock purchase plan and unvested restricted stock units. The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. | |||
Fair value measurements | Fair value measurements | ||
Accounting Standards Codification Topic (ASC) 820-10, Fair Value Accounting (ASC 820), provides a common definition of fair value and establishes a framework to make the measurement of fair value in U.S. GAAP more consistent and comparable. This guidance also requires expanded disclosures to provide information about the extent to which fair value is used to measure assets and liabilities, the methods and assumptions used to measure fair value, and the effect of fair value measures on earnings. Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants and requires that assets and liabilities carried at fair value be classified and disclosed in the following three categories: | |||
• | Level 1—Quoted prices for identical instruments in active markets. | ||
• | Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets. | ||
• | Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. | ||
The Company's financial assets and liabilities, which include financial instruments as defined by ASC 820, include cash and cash equivalents, accounts receivable, accounts payable, long-term debt and derivatives. The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable are a reasonable approximation of fair value due to the short maturities of these instruments. The carrying amount of long-term debt approximates fair value based on borrowing rates currently available to the Company. The carrying amount of the Company's derivative instruments is recorded at fair value and is determined based on observable inputs that are corroborated by market data (Level 2). | |||
As of March 31, 2015 and March 31, 2014, the fair values of our derivative instruments that were carried at fair value on a recurring basis were not significant. | |||
Derivative instruments | Derivative instruments | ||
The Company's derivative instruments are recorded at fair value in other current assets or other current liabilities, respectively, in the consolidated balance sheets. Changes in fair value are reported as a component of other income or loss on our consolidated statements of operations. For all periods presented, none of our derivative instruments were designated as hedging instruments. The Company does not use foreign currency option or foreign exchange forward contracts for speculative or trading purposes. | |||
The Company purchases foreign currency forward contracts, generally with maturities of six months or less, to reduce the volatility of cash flows primarily related to forecasted payments and expenses denominated in certain foreign currencies. As of March 31, 2015, RealD had outstanding forward contracts based in British pound sterling and Euro with notional amounts totaling $2.9 million. As of March 31, 2014, the Company had outstanding forward contracts based in British pound sterling and Euro with notional amounts totaling $0.4 million. As of March 31, 2015, the carrying amount of the Company's foreign currency forward contracts was $0.4 million. As of March 31, 2014, the carrying amount of the Company's foreign currency forward contracts was insignificant. Foreign currency forward contracts were classified as Level 2 fair value instruments, which was determined based on observable inputs that were corroborated by market data both as of March 31, 2015 and March 31, 2014. The net realized and unrealized gains and losses related to forward contracts were $0.5 million, $0.6 million and $0.9 million for fiscal years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||
Marketable securities | Marketable securities | ||
RealD classifies unrealized gains and losses on marketable securities reported as a component of accumulated other comprehensive income. As of March 31, 2015, March 31, 2014 and March 31, 2013, the Company had no marketable securities. | |||
The objectives of RealD's investment policy are to preserve capital, provide sufficient liquidity to satisfy operating and investment purposes, and capture a market rate of return based on the Company's investment policy parameters and market conditions. The Company's investment policy limits investments to certain types of debt and money market instruments issued by institutions with investment grade credit ratings and places restrictions on maturities and concentration by type and issuer. | |||
Cash equivalents | Cash equivalents | ||
The Company considers cash equivalents to be only those investments that are highly liquid, readily convertible into cash and which mature within three months from the date of purchase. | |||
Accounts receivable, net | Accounts receivable, net | ||
Accounts receivable, net, consists of trade receivables, value-added tax ("VAT") receivables, other receivables and allowance for doubtful accounts and customer credits. The Company provides credit to its customers, who are primarily in the movie production and exhibition businesses. The Company provides for the estimated accounts receivable that will not be collected. These estimates are based on an analysis of historical bad debts, customer concentrations, customer creditworthiness, current economic trends and changes in the customers’ payment terms and their economic condition. Collection of accounts receivable may be affected by changes in economic or other industry conditions and may, accordingly, impact the Company’s overall credit risk. The allowance for doubtful accounts and customer credits totaled $5.9 million and $4.1 million as of March 31, 2015 and March 31, 2014, respectively. | |||
Inventories and deferred costs-eyewear | Inventories and deferred costs-eyewear | ||
Inventories and deferred costs-eyewear represent RealD eyewear and are substantially all finished goods. Inventories and deferred costs-eyewear are valued at the lower of cost (first-in, first-out method) or market value. At each balance sheet date, the Company evaluates ending inventories and deferred costs-eyewear for net realizable value. The Company also evaluates inventories for excess quantities and obsolescence. These evaluations include analyses of expected future average selling prices, projections of future demand and technology changes. In order to state inventories at the lower of cost or market, RealD maintains reserves against such inventories. If the Company’s analyses indicate that market is lower than cost, a write-down of inventories is recorded in cost of revenue in the period the loss is identified. As of March 31, 2015 and March 31, 2014, the inventory reserve as a result of our net realizable value analyses was $0.1 million and $0.6 million, respectively. | |||
Domestically, the Company provides RealD eyewear free of charge to motion picture exhibitors and then receives a fee from the motion picture studios for the usage of RealD eyewear by the motion picture exhibitors’ consumers. Eyewear shipped from inventory is deferred on the shipment date and then amortized to cost of product revenue according to assumptions related to eyewear usage by consumers. Internationally, the motion picture exhibitors prepays the Company for RealD eyewear ordered. Inventory shipped is recognized to cost of product revenue according to transfer of title. Globally, the Company may provide limited amount of RealD eyewear to motion picture studios for marketing purposes. Inventory shipped is recognized to sales and marketing expense. | |||
Property and equipment, RealD Cinema Systems and digital projectors | Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. The major categories and related estimated useful lives are as follows: | |||
RealD Cinema Systems | 5 - 8 years | ||
Digital projectors—held for sale | 10 years | ||
Leasehold improvements | Shorter of useful life or lease | ||
Machinery and equipment | 2 - 7 years | ||
Furniture and fixtures | 3 - 5 years | ||
Computer equipment and software | 3 - 5 years | ||
Digital projectors—held for sale (digital projectors) also include digital servers, lenses and accessories. Upon installation at the customer location, the Compnay retains title to the RealD Cinema Systems which are held and used by its customers. The digital projectors are held for sale at either a specified date or upon occurrence of certain contingent events. Depreciation for RealD Cinema Systems and digital projectors is included in cost of revenue. | |||
Major enhancements and improvements are capitalized. Maintenance and repairs for cinema systems and digital projectors are charged to expense as incurred. Maintenance and repairs expense totaled $0.3 million, $0.5 million and $0.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||
Other intangibles, net | Other intangibles, net | ||
Other intangibles, net, are deemed to have finite lives and consist of acquired developed technologies (which are primarily patents) and are amortized over their estimated useful lives of 5 to 19 years (with a weighted average remaining amortization period of 4.5 years) using the straight-line method. | |||
Impairment of long-lived assets | Impairment of long-lived assets | ||
The Company reviews long-lived assets, such as property and equipment, cinema systems, digital projectors and intangibles, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Factors or circumstances that could indicate the occurrence of such events include current period operating or cash flow losses combined with a history of operating or cash flow losses, a projection or forecast that demonstrates continuing operating or cash flow losses, or incurring costs in excess of amounts originally expected to acquire or construct an asset. If the asset is not recoverable, an impairment loss is recognized as the amount by which the carrying amount of the asset exceeds its fair value. | |||
During the year ended March 31, 2015, the impairment charged to cost of revenue for all impaired RealD Cinema Systems totaled $5.0 million. | |||
During the year ended March 31, 2014, the impairment charged to cost of revenue for all impaired RealD Cinema Systems totaled $4.5 million. | |||
During the year ended March 31, 2013, the Company determined that a non-cancelable purchase commitment for certain cinema systems configurations in the aggregate amount of $3.5 million were not fully recoverable, primarily due to the initial investment costs which are expected to exceed the anticipated future cash flows for the related cinema systems. The impairment charged during the year ended March 31, 2013 for all impaired RealD Cinema Systems charged to cost of revenue was $8.0 million of the total $8.7 million impairment expense. | |||
Goodwill | Goodwill | ||
Goodwill is deemed to have an indefinite useful life and therefore is not amortized. The Company evaluates its goodwill for impairment using a two-step process that is performed at least annually during our fourth fiscal quarter, or whenever events or circumstances indicate that goodwill may be impaired. The first step is a comparison of the fair value of an internal reporting unit with its carrying amount, including goodwill. A reporting unit is an operating segment or one level below an operating segment. If the fair value of the reporting unit exceeds its carrying value, goodwill of the reporting unit is not considered impaired and the second step is unnecessary. If the carrying value of the reporting unit exceeds its fair value, the second step is performed to measure the amount of impairment by comparing the carrying amount of the goodwill to a determination of the implied value of the goodwill. If the carrying amount of goodwill is greater than the implied value, an impairment loss is recognized for the difference. The Company currently has one reporting unit in which goodwill resides and the reporting unit did not fail step one. | |||
Revenue recognition | Revenue recognition | ||
The Company derives substantially all of its revenue from the license of RealD Cinema Systems and the product sale of RealD eyewear. RealD evaluates revenue recognition for transactions using the criteria set forth by the Financial Accounting Standard Board (FASB) Accounting Standards Codification (ASC) Topic 840, Leases, and ASC Topic 605, Revenue Recognition. The revenue recognition guidance states that revenue is recognized when all of the following criteria are met: persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the seller’s price to the buyer is fixed or determinable and collectability is reasonably assured. The Company records revenue net of estimated allowances. | |||
License revenue | |||
License revenue, net of lease incentives and other allowances, is accounted for as an operating lease. License revenue is primarily derived under per-admission, percentage of box office, periodic fixed fee, or per-motion picture basis with motion picture exhibitors. Amounts received up front, less estimated lease incentives, are deferred and recognized over the lease term using the straight-line method. Additional lease payments that are contingent upon future events outside the Company’s control, including those related to admission and usage, are recognized as revenues when the contingency is resolved and the Company has no more obligations to our customers specific to the contingent payment received. Certain of the Company’s license revenue from leasing RealD Cinema Systems is earned upon admission by the motion picture exhibitor’s consumers. The Company’s licensees, however, do not report and pay for such license revenue until after the admission has occurred, which may be received subsequent to the Company’s fiscal period end. The Company estimates and records domestic licensing revenue related to motion picture exhibitor consumer admissions in the quarter in which the admission occurs, but only when reasonable estimates of such amounts can be made. The Company records its international licensing revenue based on actual amounts reported by motion picture exhibitors. The Company determines that there is persuasive evidence of an arrangement upon the execution of a license agreement or upon the receipt of a licensee’s admissions report. Revenue is deemed fixed or determinable upon receipt of a licensee’s admissions report or evidence of a RealD box office showing by licensee. The Company determines collectability based on an evaluation of the licensee’s recent payment history and evaluation of the respective customer’s credit-standing. | |||
Product revenue | |||
The Company recognizes product revenue, net of allowances, when title and risk of loss have passed and when there is persuasive evidence of an arrangement, the payment is fixed or determinable, and collectability of payment is reasonably assured. In the United States and Canada, certain of the Company’s product revenue from the sale of RealD eyewear is earned upon admission and usage by the motion picture exhibitor’s consumers. The Company’s customers, however, do not report admission or usage information until after the admission and usage has occurred, and such information may be received subsequent to the Company’s fiscal period end. Accordingly, the Company estimates and records such product revenue in the quarter in which the admission and usage occurs, but only when reasonable estimates of such amounts can be made. Internationally, the motion picture exhibitors prepays for the RealD eyewear, which is deferred upon receipt of cash and earned upon shipping and transfer of title of the products. There are not estimates made in relation to international sales. | |||
Cost of revenue | Cost of revenue | ||
Cost of revenue principally consists of depreciation expense of RealD Cinema Systems deployed at a motion picture exhibitor's premises, digital projector depreciation expenses, impairment of goodwill and intangible assets, losses on assets of non-cancelable commitments, RealD eyewear costs (including shipping, handling and recycling costs), field service and support costs, occupancy costs and gain and loss from sale of production assets. | |||
Shipping and handling costs | Shipping and handling costs | ||
Amounts billed to customers for shipping and handling costs are included in revenue. Shipping and handling costs that we incur consist primarily of packaging and transportation charges and are recorded in cost of revenue. Shipping and handling costs recognized in cost of revenue were $4.0 million, $6.6 million and $7.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||
Research and development costs | Research and development costs | ||
Research and development (R&D) costs are expensed as incurred. Major components of R&D expense include salaries and benefits, depreciation for R&D assets, materials and supplies inclusive of prototypes, non-recurring engineering, payments to third parties for R&D, facilities and equipment that can only be used for a particular project and overhead allocations of various administrative and facilities costs related to R&D | |||
Selling and marketing costs | Selling and marketing costs | ||
Selling and marketing costs are primarily comprised of personnel costs related to our selling and marketing staff, advertising costs, including promotional events and other brand building and product marketing expenses, corporate communications, certain professional fees, occupancy costs and travel expenses. | |||
Advertising costs are expensed as incurred. Advertising expenses were approximately $2.9 million, $2.7 million and $3.7 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||
General and administrative costs | General and administrative costs | ||
General and administrative costs principally consist of personnel costs related to our executive, legal, finance and human resources staff, professional fees including legal and accounting costs, occupancy costs, public company costs, bad debt expenses and gain and loss from disposition of assets. Additionally, general and administrative costs include sales, use, goods and services tax and value added tax (collectively, the "transaction taxes") as well as property taxes. For our U.S. and some of our international cinema license and product revenue, we absorb the majority of the transaction taxes. | |||
Share-based compensation | Share-based compensation | ||
RealD accounts for share-based awards granted to employees and directors by recording compensation expense based on estimated fair values. The Company estimates the fair value of share-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods in its consolidated statements of operations. Share-based awards are attributed to expense using the straight-line method over the vesting period. The Company determines the value of each option award that contains a market condition using a Monte Carlo Simulation valuation model, while all other option awards are valued using the Black-Scholes valuation model as permitted under ASC 718, Compensation—Stock Compensation. The assumptions used in calculating the fair value of share-based payment awards represent the Company's best estimates. The Company's estimates of the fair values of share-based awards granted and the resulting amounts of share-based compensation recognized may be impacted by certain variables including stock price volatility, employee stock option exercise behaviors, additional stock option grants, modifications, estimates of forfeitures, and the related income tax impact. If any of the assumptions used in the Company's valuation models significantly change, share-based compensation for future awards may differ materially from the awards granted previously. See Note 9, Share-based compensation. | |||
Foreign currency | Foreign currency | ||
Local currency transactions of the Company's foreign operations that have the U.S. dollar as their functional currency are remeasured into U.S. dollars using current rates of exchange for monetary assets and liabilities and historical rates of exchange for nonmonetary assets and liabilities. Gains and losses from remeasurement of monetary assets and liabilities are included in other income (loss) in the Company's statements of operations. | |||
The assets and liabilities of our foreign operations for which the functional currency is not the U.S. dollar are translated into U.S. dollars at exchange rates as of the balance sheet date, revenues and expenses are translated at average exchange rates for the period, and equity balances are translated at the historical rate. Resulting translation adjustments are included in other comprehensive loss, a component of equity (deficit). | |||
Net income and losses arising from exchange rate fluctuations on transactions denominated in a currency other than the functional currency and the net realized and unrealized gains and losses related to forward contracts totaled $0.5 million, $0.6 million and $0.9 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively, and are included in other income (loss). | |||
Income taxes | Income taxes | ||
Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities at year-end and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount more likely than not to be realized. | |||
Accruals for uncertain tax positions are provided for in accordance with the authoritative guidance for accounting for uncertainty in income taxes (ASC 740). The Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The authoritative guidance for accounting for uncertainty in income taxes also provides guidance on derecognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. The Company's policy is to recognize interest expense and penalties related to income tax matters as a component of income tax expense. | |||
Employee benefit plans | Employee benefit plans | ||
RealD has a voluntary 401(k) saving plans in which most U.S. employees are eligible to participate. Eligible employees may make contributions not to exceed the maximum statutory contribution amounts. The Company may match a percentage of each employee's contributions consistent with the provisions of the plan for which they are eligible. All employee and employer contributions fully vest immediately. The Company's contributions to these plans totaled $0.4 million, $0.6 million and $0.6 million for the years ended March 31, 2015, March 31, 2014 and March 31, 2013, respectively. | |||
Recent accounting pronouncements | Recent accounting pronouncements | ||
In May 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2014-09 Revenue from Contracts with Customers (Topic 606), effective for RealD starting April 1, 2017 (the first quarter of fiscal year 2018). Early application is not permitted. The new standard will be implemented retrospectively with the Company choosing to either restate prior periods or recognize the cumulative effect; the Company has not yet selected a transition method. | |||
The new Topic 606 does not apply to lease contracts within the scope of Topic 840 Leases. The primary objective of ASU 2014-09 is to provide guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. This ASU will supersede the revenue recognition requirements in Topic 605 Revenue Recognition and most industry-specific guidance. The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers, in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. Revenue recognition is anticipated to entail more judgment and more estimating than under the current guidance. ASU 2014-09 also changes Topic 360 Property, Plant and Equipment, Topic 350 Intangibles-Goodwill and Other and certain other U.S. GAAP. The Company has not yet determined the effects of Topic 606 and other ASU 2014-09 revisions on its consolidated financial statements. | |||
In June 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-12, "Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period". ASU 2014-12 requires that a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. As such, the performance target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. This pronouncement is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and early adoption is permitted. The Company adopted the provisions of ASU 2014-12 in the third quarter of fiscal year 2015. The Company’s adoption is not expected to have any material impact on its consolidated financial statements. The Company already follows the accepted accounting within ASU 2014-12 for stock compensation terms within the scope of this clarifying guidance. | |||
In February 2015,the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis”. The objective of ASU 2015-02 is to modify the consolidation requirements of Topic 810 to ensure that reporting entities do not consolidate other legal entities in situations where deconsolidation actually more accurately represents operational and economic results. Among other changes, the amendments to ASC 810 include lessening the relevance on fees paid to a decision-maker or service provider and the related party tiebreaker test.The amendments are effective for public business entities for fiscal years, and for interim periods within those fiscal years beginning after December 15, 2015. This ASU may be adopted using a full retrospective approach or a modified retrospective approach by recording a cumulative effect adjustment to equity as of the beginning of the fiscal year of adoption. ASU 2015-02 will be effective for the Company beginning in fiscal 2017, the Company has not yet determined the effects of ASU 2015-02 on its consolidated financial statements. | |||
In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-03, "Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs", which changes the presentation of debt issuance costs in financial statements. Under the ASU 2015-03, such costs are presented in the balance sheet as a direct deduction from the related debt liability rather than as an asset. Amortization of the costs is reported as interest expense. This pronouncement is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and early adoption is allowed for all entities for financial statements that have not been previously issued. The guidance is to be applied retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). ASU 2015-03 will be effective for the Company beginning in fiscal 2017. The Company elected not to early adopt and is currently evaluating the impact that the adoption of ASU 2015-03 may have on its consolidated financial statements. |
Summary_of_significant_account2
Summary of significant accounting policies (Tables) | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Accounting Policies [Abstract] | ||||||||||||
Schedule of calculation of the basic and diluted earnings (loss) per share of common stock | The calculation of the basic and diluted loss per share of common stock for the years ended March 31, 2015, March 31, 2014 and March 31, 2013 was as follows: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands, except per share data) | 2015 | 2014 | 2013 | |||||||||
Numerator: | ||||||||||||
Net loss | $ | (23,747 | ) | $ | (11,210 | ) | $ | (9,887 | ) | |||
Net (income) loss attributable to noncontrolling interest | (75 | ) | (196 | ) | 197 | |||||||
Net loss attributable to RealD Inc. common stockholders | $ | (23,822 | ) | $ | (11,406 | ) | $ | (9,690 | ) | |||
Denominator: | ||||||||||||
Weighted-average common shares outstanding (basic) | 50,042 | 49,504 | 52,345 | |||||||||
Effect of dilutive securities | — | — | — | |||||||||
Weighted-average common shares outstanding (diluted) | 50,042 | 49,504 | 52,345 | |||||||||
Loss per common share: | ||||||||||||
Basic | $ | (0.48 | ) | $ | (0.23 | ) | $ | (0.19 | ) | |||
Diluted | $ | (0.48 | ) | $ | (0.23 | ) | $ | (0.19 | ) | |||
Schedule of weighted-average number of anti-dilutive shares excluded from the calculation of diluted earnings (loss) per common share | The weighted-average number of anti-dilutive shares excluded from the calculation of diluted earnings (loss) per common share for the years ended March 31, 2015, March 31, 2014 and March 31, 2013 was as follows: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Options and warrants to purchase common stock | 9,632 | 9,299 | 8,441 | |||||||||
Total | 9,632 | 9,299 | 8,441 | |||||||||
Schedule of major categories and related estimated useful lives | The major categories and related estimated useful lives are as follows: | |||||||||||
RealD Cinema Systems | 5 - 8 years | |||||||||||
Digital projectors—held for sale | 10 years | |||||||||||
Leasehold improvements | Shorter of useful life or lease | |||||||||||
Machinery and equipment | 2 - 7 years | |||||||||||
Furniture and fixtures | 3 - 5 years | |||||||||||
Computer equipment and software | 3 - 5 years |
Cinema_Systems_and_Property_Eq1
Cinema Systems and Property & Equipment (Tables) | 12 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Property and equipment, RealD Cinema Systems and digital projectors | ||||||||
Schedule of property and equipment of RealD Cinema Systems and digital projectors | Property and equipment, RealD Cinema Systems and digital projectors consist of the following: | |||||||
(in thousands) | March 31, | March 31, | ||||||
2015 | 2014 | |||||||
RealD Cinema Systems | $ | 208,056 | $ | 205,416 | ||||
Digital projectors—held for sale | — | 216 | ||||||
Leasehold improvements | 16,974 | 16,935 | ||||||
Machinery and equipment | 5,791 | 4,753 | ||||||
Furniture and fixtures | 1,238 | 1,272 | ||||||
Computer equipment and software | 10,581 | 9,197 | ||||||
Construction in process | 565 | 1,554 | ||||||
Total | $ | 243,205 | $ | 239,343 | ||||
Less accumulated depreciation | (140,363 | ) | (110,060 | ) | ||||
Property and equipment, RealD Cinema Systems and digital projectors, net | $ | 102,842 | $ | 129,283 | ||||
Goodwill_and_other_intangibles1
Goodwill and other intangibles, net (Tables) | 12 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Schedule of components of goodwill and intangible assets | Goodwill and other intangibles, net, consist of the following at: | |||||||||||||||
31-Mar-15 | 31-Mar-14 | |||||||||||||||
(in thousands) | Gross | Accumulated | Gross | Accumulated | ||||||||||||
amount | amortization | amount | amortization | |||||||||||||
Acquired developed technologies | $ | 9,324 | $ | 4,507 | $ | 9,324 | $ | 3,170 | ||||||||
Goodwill | 10,657 | — | 10,657 | — | ||||||||||||
Total | $ | 19,981 | $ | 4,507 | $ | 19,981 | $ | 3,170 | ||||||||
Schedule of estimated remaining amortization expense | At March 31, 2015, the remaining amortization expense is estimated to be as follows (in thousands): | |||||||||||||||
Fiscal year 2016 | $ | 1,303 | ||||||||||||||
Fiscal year 2017 | 1,300 | |||||||||||||||
Fiscal year 2018 | 1,287 | |||||||||||||||
Fiscal year 2019 | 306 | |||||||||||||||
Fiscal year 2020 | 129 | |||||||||||||||
Thereafter | 492 | |||||||||||||||
Total | $ | 4,817 | ||||||||||||||
Accrued_expenses_and_other_lia1
Accrued expenses and other liabilities (Tables) | 12 Months Ended | |||||||||||||||||||||||
Mar. 31, 2015 | ||||||||||||||||||||||||
Payables and Accruals [Abstract] | ||||||||||||||||||||||||
Schedule of accrued expenses and other liabilities | Accrued expenses and other liabilities consist of the following at: | |||||||||||||||||||||||
(in thousands) | March 31, | March 31, | ||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
Payroll and compensation | $ | 8,673 | $ | 5,070 | ||||||||||||||||||||
Sales, use taxes and other taxes | 6,317 | 6,582 | ||||||||||||||||||||||
Professional fees | 3,206 | 1,484 | ||||||||||||||||||||||
RealD Cinema system contractual obligations | 5,154 | 4,134 | ||||||||||||||||||||||
Other | 3,290 | 4,626 | ||||||||||||||||||||||
Total | $ | 26,640 | $ | 21,896 | ||||||||||||||||||||
Summary of actual charges resulting from implementation of the cost reduction plan | The following tables summarizes the charges resulting from implementation of the Cost Reduction Plans for the fiscal year ended March 31, 2015 and March 31, 2014: | |||||||||||||||||||||||
Years ended March 31 | ||||||||||||||||||||||||
2015 | 2014 | |||||||||||||||||||||||
(in thousands) | Personnel | Leasehold | Total | Personnel | Leasehold | Total | ||||||||||||||||||
Cost of revenue | $ | 242 | $ | 601 | $ | 843 | $ | 835 | $ | 13 | $ | 848 | ||||||||||||
Research and development | 240 | — | 240 | 757 | — | 757 | ||||||||||||||||||
Selling and marketing | 97 | — | 97 | 1,830 | — | 1,830 | ||||||||||||||||||
General and administrative | 192 | — | 192 | 1,206 | 77 | 1,283 | ||||||||||||||||||
Total | $ | 771 | $ | 601 | $ | 1,372 | $ | 4,628 | $ | 90 | $ | 4,718 | ||||||||||||
Summary of actual and estimated activity resulting from implementation of the cost reduction plan with accrued expenses and other liabilities | The following table summarizes the actual and estimated activity resulting from implementation of the cost reduction plan with accrued expenses and other liabilities: | |||||||||||||||||||||||
Cost reduction plan liabilities | ||||||||||||||||||||||||
(in thousands) | Personnel | Leasehold | Total | |||||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2013 | $ | — | $ | — | $ | — | ||||||||||||||||||
Charges | 4,628 | 90 | 4,718 | |||||||||||||||||||||
(Payments) | (3,212 | ) | (90 | ) | (3,302 | ) | ||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2014 | $ | 1,416 | $ | — | $ | 1,416 | ||||||||||||||||||
Charges | 771 | 601 | 1,372 | |||||||||||||||||||||
(Payments) | (938 | ) | (336 | ) | (1,274 | ) | ||||||||||||||||||
Cost reduction plan liabilities as of March 31, 2015 | $ | 1,249 | $ | 265 | $ | 1,514 | ||||||||||||||||||
Borrowings_Tables
Borrowings (Tables) | 12 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Schedule of the current and non-current portions of the credit agreement | The current and non-current portions of the Credit Agreement due as of March 31, 2015 and March 31, 2014, which include both the 2012 Credit Agreement and 2014 Credit Agreement in the table below,were as follows: | |||||||
March 31, | March 31, | |||||||
2015 | 2014 | |||||||
(in thousands) | ||||||||
Current portion of Credit Agreement | $ | 7,460 | $ | 12,500 | ||||
Credit Agreement, net of current portion | 22,380 | 23,750 | ||||||
Total Credit Agreement | $ | 29,840 | $ | 36,250 | ||||
Schedule of future minimum credit agreement obligations | At March 31, 2015, our future minimum Credit Agreement obligations were as follows: | |||||||
Fiscal year 2016 | $ | 7,460 | ||||||
Fiscal year 2017 | 7,460 | |||||||
Fiscal year 2018 | 7,460 | |||||||
Fiscal year 2019 | 7,460 | |||||||
Total | $ | 29,840 | ||||||
Commitments_and_contingencies_
Commitments and contingencies (Tables) | 12 Months Ended | |||
Mar. 31, 2015 | ||||
Commitments and Contingencies Disclosure [Abstract] | ||||
Schedule of future minimum lease obligations | At March 31, 2015, the Company's future minimum lease obligations were as follows (in thousands): | |||
Fiscal year 2016 | $ | 4,313 | ||
Fiscal year 2017 | 4,019 | |||
Fiscal year 2018 | 4,076 | |||
Fiscal year 2019 | 4,082 | |||
Fiscal year 2020 | 4,203 | |||
Thereafter | 10,710 | |||
Total | $ | 31,403 | ||
Equity_Tables
Equity (Tables) | 12 Months Ended | ||
Mar. 31, 2015 | |||
Equity [Abstract] | |||
Schedule of reserve of common stock for future issuances | At March 31, 2015, the Company reserved the following shares of common stock for future issuances in connection with: | ||
(in thousands) | |||
Restricted stock units | 1,524 | ||
Performance stock options | 236 | ||
Performance stock units | 1,029 | ||
Stock option plan: | |||
Outstanding | 6,804 | ||
Reserved for future issuance | 5,965 | ||
Total | 15,558 | ||
Sharebased_compensation_Tables
Share-based compensation (Tables) | 12 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Share-based compensation | |||||||||||||
Schedule of components of stock-based compensation expense recognized in our consolidated statements of operations | The following table reflects the components of share-based compensation expense recognized in the Company's consolidated statements of operations for the years ended March 31, 2015, March 31, 2014 and March 31, 2013: | ||||||||||||
Years ended March 31 | |||||||||||||
(in thousands) | 2015 | 2014 | 2013 | ||||||||||
Cost of revenue | $ | 1,212 | $ | 865 | $ | 807 | |||||||
Research and development | 3,227 | 2,708 | 2,185 | ||||||||||
Selling and marketing | 3,017 | 5,543 | 5,258 | ||||||||||
General and administrative | 7,442 | 8,625 | 10,224 | ||||||||||
Total | $ | 14,898 | $ | 17,741 | $ | 18,474 | |||||||
Schedule of nonvested performance units activity | |||||||||||||
(in thousands, except exercise price | Units | Weighted- | |||||||||||
data and contractual term data) | average | ||||||||||||
grant date | |||||||||||||
fair value | |||||||||||||
Nonvested at March 31, 2014 | 668 | $ | 14.96 | ||||||||||
Granted | 652 | 11.46 | |||||||||||
Vested | (129 | ) | 11.46 | ||||||||||
Forfeited or cancelled | (741 | ) | 14.15 | ||||||||||
Nonvested at March 31, 2015 | 450 | $ | 12.23 | ||||||||||
Summary of restricted stock units | The following summarizes select information regarding the Company's restricted stock units during the year ended March 31, 2015: | ||||||||||||
(in thousands, except grant | Units | Weighted- | |||||||||||
date fair value data) | average | ||||||||||||
grant date | |||||||||||||
fair value | |||||||||||||
Nonvested at March 31, 2014 | 479 | $ | 13.13 | ||||||||||
Granted | 1,303 | 11.27 | |||||||||||
Vested | (327 | ) | 12.16 | ||||||||||
Forfeited or cancelled | (215 | ) | 11.61 | ||||||||||
Nonvested at March 31, 2015 | 1,240 | $ | 11.69 | ||||||||||
Stock options | |||||||||||||
Share-based compensation | |||||||||||||
Summary of stock option activity | A summary of the Company's stock option activity is as follows: | ||||||||||||
(in thousands, except exercise price | Options | Weighted- | Weighted- | Aggregate | |||||||||
data and contractual term data) | average | average | intrinsic | ||||||||||
exercise | remaining | value | |||||||||||
price | contractual | ||||||||||||
term (years) | |||||||||||||
Outstanding at March 31, 2014 | 7,811 | $ | 13.11 | ||||||||||
Granted | 602 | 11.25 | |||||||||||
Exercised | (779 | ) | 4.58 | ||||||||||
Forfeited or expired | (830 | ) | 15.08 | ||||||||||
Outstanding at March 31, 2015 | 6,804 | $ | 13.68 | 5.6 | $ | 14,309 | |||||||
Exercisable at March 31, 2015 | 5,689 | $ | 13.97 | 5.1 | $ | 11,486 | |||||||
Vested or expected to vest | 6,694 | $ | 13.76 | 5.6 | $ | 13,083 | |||||||
Schedule of weighted-average assumptions to determine weighted-average grant date fair values | The weighted-average grant date fair values were determined using the Black- Scholes option-pricing model with the following weighted-average assumptions: | ||||||||||||
Years ended March 31 | |||||||||||||
2015 | 2014 | 2013 | |||||||||||
Fair value of stock options granted | $ | 5.9 | $ | 7.2 | $ | 6.2 | |||||||
Expected volatility | 55 | % | 60 | % | 60 | % | |||||||
Expected term (years) | 6 | 6 | 6 | ||||||||||
Risk-free rate | 1.2 | % | 1.4 | % | 1 | % | |||||||
Expected dividends | — | — | — | ||||||||||
Performance stock option | |||||||||||||
Share-based compensation | |||||||||||||
Summary of stock option activity | A summary of the Company's performance stock option activity is as follows: | ||||||||||||
(in thousands, except exercise price | Options | Weighted- | Weighted- | ||||||||||
data and contractual term data) | average | average | |||||||||||
exercise | remaining | ||||||||||||
price | contractual | ||||||||||||
term (years) | |||||||||||||
Outstanding at March 31, 2014 | 686 | $ | 14.98 | 7.3 | |||||||||
Granted | — | — | 0 | ||||||||||
Exercised | — | — | 0 | ||||||||||
Forfeited or expired | — | — | 0 | ||||||||||
Outstanding at March 31, 2015 | 686 | $ | 14.98 | 6.3 | |||||||||
Income_taxes_Tables
Income taxes (Tables) | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||
Schedule of income tax provision from continuing operations | The income tax provision from continuing operations for the fiscal years ended March 31, 2015, March 31, 2014 and March 31, 2013 consists of the following: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Current income tax provision: | ||||||||||||
Federal | $ | — | $ | — | $ | — | ||||||
State | 47 | 132 | 103 | |||||||||
Foreign | 7,458 | 6,128 | 5,202 | |||||||||
7,505 | 6,260 | 5,305 | ||||||||||
Deferred income tax benefit: | ||||||||||||
Federal | — | — | — | |||||||||
State | — | — | — | |||||||||
Foreign | 404 | (143 | ) | (241 | ) | |||||||
Total income tax provision from continuing operations | $ | 7,909 | $ | 6,117 | $ | 5,064 | ||||||
Schedule of income (loss) from continuing operations before income taxes | Income (loss) from continuing operations before income taxes consisted of the following: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
United States | $ | (23,020 | ) | $ | (11,224 | ) | $ | (6,963 | ) | |||
Foreign | 7,182 | 6,131 | 2,140 | |||||||||
Total | $ | (15,838 | ) | $ | (5,093 | ) | $ | (4,823 | ) | |||
Schedule of components of deferred tax balances | Significant components of the Company's deferred tax balances are as follows: | |||||||||||
(in thousands) | March 31, | March 31, | ||||||||||
2015 | 2014 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss carryforwards | $ | 28,180 | $ | 24,971 | ||||||||
Deferred revenues | 1,288 | 2,708 | ||||||||||
Accruals, reserves and allowances | 6,828 | 7,698 | ||||||||||
Stock compensation | 16,936 | 15,796 | ||||||||||
Foreign tax credit carryovers | 18,781 | 15,181 | ||||||||||
Partnership interest | 6 | 44 | ||||||||||
Other | 1,353 | 1,445 | ||||||||||
Total deferred tax assets | $ | 73,372 | $ | 67,843 | ||||||||
Deferred tax liabilities | ||||||||||||
Fixed assets | $ | (12,876 | ) | $ | (15,020 | ) | ||||||
Intangible assets | (150 | ) | (118 | ) | ||||||||
Unbilled receivables | (3,230 | ) | (5,821 | ) | ||||||||
Other | (565 | ) | (426 | ) | ||||||||
Total deferred tax liabilities | $ | (16,821 | ) | $ | (21,385 | ) | ||||||
Valuation allowance | $ | (56,673 | ) | $ | (46,175 | ) | ||||||
Net deferred tax assets (liabilities) | $ | (122 | ) | $ | 283 | |||||||
Schedule of increase in valuation allowance through the operating statement | As a result, the Company increased its valuation allowance through the operating statement as follows: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | ||||||||||
Through continuing operation | $ | 10,498 | $ | 7,091 | ||||||||
Increase in valuation allowance | $ | 10,498 | $ | 7,091 | ||||||||
Schedule of differences between the income tax provision from continuing operations and taxes computed by applying the U.S. statutory federal income tax rate to the pretax income (loss) | The income tax provision from continuing operations differs from the amount computed by applying the U.S. statutory federal income tax rate of 34% to the pretax income (loss) as a result of the following differences: | |||||||||||
Years ended March 31 | ||||||||||||
2015 | 2014 | 2013 | ||||||||||
Federal tax at statutory rate | 34 | % | 34 | % | 34 | % | ||||||
State tax, net of federal benefit | 2.7 | % | (1.4 | )% | (7.7 | )% | ||||||
Foreign tax rate differential | 4.5 | % | 8.6 | % | 2.9 | % | ||||||
LLC income minority interest not taxed | 0.2 | % | 1.4 | % | (1.3 | )% | ||||||
Revaluation of deferred taxes due to changes in effective income tax rates | (0.6 | )% | (0.8 | )% | 3.8 | % | ||||||
Foreign withholding taxes (credits) | — | % | (0.9 | )% | — | % | ||||||
Permanent differences and other | (17.8 | )% | 15.2 | % | 3.7 | % | ||||||
Stock compensation | (4.5 | )% | (37.0 | )% | (34.9 | )% | ||||||
Change in valuation allowance | (68.4 | )% | (139.0 | )% | (105.5 | )% | ||||||
Total tax benefit | (49.9 | )% | (119.9 | )% | (105.0 | )% | ||||||
Summary of activity related to unrecognized tax benefits | The following table summarizes the activity related to our unrecognized tax benefits (in thousands): | |||||||||||
Balance as of March 31, 2014 | $ | 346 | ||||||||||
Increases related to prior year tax positions | — | |||||||||||
Increase related to current year tax positions | — | |||||||||||
Expiration of the statute of limitations for the assessment of taxes | — | |||||||||||
Settlements | — | |||||||||||
Balance as of March 31, 2015 | $ | 346 | ||||||||||
Segment_and_geographic_informa1
Segment and geographic information (Tables) | 12 Months Ended | |||||||||||
Mar. 31, 2015 | ||||||||||||
Segment Reporting [Abstract] | ||||||||||||
Schedule of revenue by geographic region, as determined based on the location of customers or the anticipated destination of use | Revenue by geographic region, as determined based on the location of the Company's customers or the anticipated destination of use was as follows: | |||||||||||
Years ended March 31 | ||||||||||||
(in thousands) | 2015 | 2014 | 2013 | |||||||||
Domestic (United States and Canada) | $ | 71,081 | $ | 96,159 | $ | 106,979 | ||||||
China | 19,243 | 16,642 | 8,615 | |||||||||
Rest of the world | 73,139 | 86,433 | 99,958 | |||||||||
Total revenues | $ | 163,463 | $ | 199,234 | $ | 215,552 | ||||||
Schedule of long-lived tangible assets, net of accumulated depreciation by geographic region | Long-lived tangible assets, net of accumulated depreciation, by geographic region were as follows: | |||||||||||
(in thousands) | March 31, | March 31, | ||||||||||
2015 | 2014 | |||||||||||
Domestic (United States and Canada) | $ | 87,134 | $ | 105,708 | ||||||||
China | 10,185 | 8,085 | ||||||||||
Rest of the world | 5,523 | 15,490 | ||||||||||
Total long-lived tangible assets | $ | 102,842 | $ | 129,283 | ||||||||
Quarterly_financial_data_Table
Quarterly financial data (Tables) | 12 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Schedule of quarterly financial data | ||||||||||||||||
Three months ended | ||||||||||||||||
March 31, | December 31, | September 30, | June 30, | |||||||||||||
2015 | 2014 | 2014 | 2014 | |||||||||||||
(Dollars in thousands, except per share data) | -1 | -1 | ||||||||||||||
Net revenue | $ | 27,905 | $ | 32,571 | $ | 47,768 | $ | 55,219 | ||||||||
Gross profit | 10,242 | 14,963 | 25,552 | 30,021 | ||||||||||||
Net income (loss) | (17,635 | ) | (11,290 | ) | (751 | ) | 5,929 | |||||||||
Net income (loss) attributable to RealD Inc. common stockholders | $ | (17,710 | ) | $ | (11,290 | ) | $ | (751 | ) | $ | 5,929 | |||||
Earning (loss) per common shares: | ||||||||||||||||
Basic | $ | (0.36 | ) | $ | (0.23 | ) | $ | (0.02 | ) | $ | 0.12 | |||||
Diluted | $ | (0.36 | ) | $ | (0.23 | ) | $ | (0.02 | ) | $ | 0.11 | |||||
_______________________________________________________________________________ | ||||||||||||||||
-1 | During the third quarter of fiscal year 2015, the Company identified certain errors and, accordingly, performed additional analyses and supplementary review procedures, following the guidance of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 250 Accounting Changes and Error Corrections and the Securities and Exchange Commission (SEC) Staff Accounting Bulletin Topic 1 Financial Statements. Upon completion of these procedures, the Company concluded that the effects of the errors were not material to any prior year previously reported amounts but are material to previously reported interim amounts for the first and second quarters of the current fiscal year. Accordingly, in the third quarter ended December 31, 2014 Form 10-Q, the Company restated certain previously reported interim condensed consolidated balance sheet, condensed consolidated statements of operations and condensed consolidated statements of cash flows amounts to correct these errors (also see Note 2, "Effect of certain correction on certain financial statements" from the Quarterly Report on Form 10-Q for the quarter ended December 31, 2014). | |||||||||||||||
Three months ended | ||||||||||||||||
(Dollars in thousands, except per share data) | March 31, | December 31, | September 30, | June 30, | ||||||||||||
2014 | 2013 | 2013 | 2013 | |||||||||||||
Net revenue | $ | 40,648 | $ | 55,438 | $ | 43,929 | $ | 59,219 | ||||||||
Gross profit | 19,902 | 27,270 | 19,906 | 28,181 | ||||||||||||
Net loss | (4,855 | ) | (155 | ) | (4,664 | ) | (1,536 | ) | ||||||||
Net loss attributable to RealD Inc. common stockholders | $ | (4,950 | ) | $ | (271 | ) | $ | (4,651 | ) | $ | (1,534 | ) | ||||
Loss per common share: | ||||||||||||||||
Basic | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.03 | ) | ||||
Diluted | $ | (0.10 | ) | $ | (0.01 | ) | $ | (0.09 | ) | $ | (0.03 | ) | ||||
Summary of changes in reporting period | ||||||||||||||||
Years ended March 31 | ||||||||||||||||
(Number of calendar days) | 2015 | 2014 | Number of | Percentage | ||||||||||||
days change | change | |||||||||||||||
1st fiscal quarter | 91 | 91 | — | — | % | |||||||||||
2nd fiscal quarter | 92 | 92 | — | — | % | |||||||||||
3rd fiscal quarter | 92 | 92 | — | — | % | |||||||||||
4th fiscal quarter | 90 | 90 | — | — | % | |||||||||||
Total number of calendar days | 365 | 365 | — | — | % | |||||||||||
Years ended March 31 | ||||||||||||||||
(Number of calendar days) | 2014 | 2013 | Number of | Percentage | ||||||||||||
days change | change | |||||||||||||||
1st fiscal quarter | 91 | 91 | — | — | % | |||||||||||
2nd fiscal quarter | 92 | 91 | 1 | 1.1 | % | |||||||||||
3rd fiscal quarter | 92 | 101 | (9 | ) | (8.9 | )% | ||||||||||
4th fiscal quarter | 90 | 90 | — | — | % | |||||||||||
Total number of calendar days (1) | 365 | 373 | (8 | ) | (2.1 | )% | ||||||||||
_______________________________________________________________________________ | ||||||||||||||||
-1 | Represents total number of calendar days difference between fiscal year 2014 and 2013 (also see "Accounting period" caption under Note 2, "Summary of significant accounting policies"). |
Summary_of_significant_account3
Summary of significant accounting policies (Accounting Period) (Details) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Nov. 14, 2012 | |
Accounting Policies [Abstract] | |||
Number of period in an accounting period | 4 | ||
Number of days by which current fiscal period is short with respect to prior fiscal year | 8 days | ||
Number of days by which period of current fiscal year is short as compared to two fiscal years ago | 8 days | ||
Percentage by which period of current fiscal year is short as compared to previous fiscal year 2013 | 2.10% | 2.10% |
Summary_of_significant_account4
Summary of significant accounting policies (Earnings (loss) Per Share of Common Stock) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||
Weighted-average number of anti-dilutive shares excluded from the calculation of diluted earnings (loss) per common share | 9,632 | 9,299 | 8,441 | ||||||||
Numerator: | |||||||||||
Net loss | ($17,635) | ($11,290) | ($751) | $5,929 | ($4,855) | ($155) | ($4,664) | ($1,536) | ($23,747) | ($11,210) | ($9,887) |
Net (income) loss attributable to noncontrolling interest | 75 | 196 | -197 | ||||||||
Net loss attributable to RealD Inc. common stockholders | ($17,710) | ($11,290) | ($751) | $5,929 | ($4,950) | ($271) | ($4,651) | ($1,534) | ($23,822) | ($11,406) | ($9,690) |
Denominator: | |||||||||||
Weighted-average common shares outstanding (basic) | 50,042 | 49,504 | 52,345 | ||||||||
Effect of dilutive securities | 0 | 0 | 0 | ||||||||
Weighted-average common shares outstanding (diluted) | 50,042 | 49,504 | 52,345 | ||||||||
Loss per common share: | |||||||||||
Basic (in dollars per share) | ($0.36) | ($0.23) | ($0.02) | $0.12 | ($0.10) | ($0.01) | ($0.09) | ($0.03) | ($0.48) | ($0.23) | ($0.19) |
Diluted (in dollars per share) | ($0.36) | ($0.23) | ($0.02) | $0.11 | ($0.10) | ($0.01) | ($0.09) | ($0.03) | ($0.48) | ($0.23) | ($0.19) |
Options and warrants to purchase common stock | |||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||
Weighted-average number of anti-dilutive shares excluded from the calculation of diluted earnings (loss) per common share | 9,632 | 9,299 | 8,441 |
Summary_of_significant_account5
Summary of significant accounting policies (Derivative Instruments) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Designated as Hedging Instrument | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Number of derivative instruments | 0 | 0 | 0 |
Level 2 | Foreign currency forward contract | Not Designated as Hedging Instrument | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Foreign currency forward contracts, maturity period | 6 months | ||
Foreign currency forward contracts, notional amount | $2.90 | 0.4 | |
Derivative, Carrying Amount | $0.40 |
Summary_of_significant_account6
Summary of significant accounting policies (Marketable Securities) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | |||
Marketable securities | $0 | $0 | $0 |
Summary_of_significant_account7
Summary of significant accounting policies (Accounts Receivable, Net) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Millions, unless otherwise specified | ||
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts and customer credits | $5.90 | $4.10 |
Summary_of_significant_account8
Summary of significant accounting policies (Inventories and Deferred Costs-Eyewear) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Millions, unless otherwise specified | ||
Accounting Policies [Abstract] | ||
Inventory reserve | $0.10 | $0.60 |
Summary_of_significant_account9
Summary of significant accounting policies (Property and Equipment) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Property, Plant and Equipment [Line Items] | |||
Maintenance and repairs for cinema systems and digital projectors | $0.30 | $0.50 | $0.90 |
Digital projectors - held for sale | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 10 years | ||
Minimum | RealD Cinema Systems | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 5 years | ||
Minimum | Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 2 years | ||
Minimum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 3 years | ||
Minimum | Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 3 years | ||
Maximum | RealD Cinema Systems | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 8 years | ||
Maximum | Machinery and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 7 years | ||
Maximum | Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 5 years | ||
Maximum | Computer equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 5 years |
Recovered_Sheet1
Summary of significant accounting policies (Intangibles) (Details) | 12 Months Ended |
Mar. 31, 2015 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 5 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 19 years |
Weighted average | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated useful lives | 4 years 6 months 0 days |
Recovered_Sheet2
Summary of significant accounting policies (Impairment of Long-Lived Assets) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Impairment charges | $5 | $4.50 | $8.70 |
Aggregate amount of non-cancellable purchase agreement for certain cinema systems configurations | 3.5 | ||
Cinema systems configurations under non-cancellable purchase commitment | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Aggregate amount of non-cancellable purchase agreement for certain cinema systems configurations | 3.5 | ||
RealD Cinema Systems | |||
Impaired Long-Lived Assets Held and Used [Line Items] | |||
Impairment charges | $8 |
Recovered_Sheet3
Summary of significant accounting policies (Shipping and Handling Costs) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | |||
Shipping and handling costs | $4 | $6.60 | $7.90 |
Recovered_Sheet4
Summary of significant accounting policies (Selling and Marketing Costs) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | |||
Advertising expenses | $2.90 | $2.70 | $3.70 |
Recovered_Sheet5
Summary of significant accounting policies (Foreign Currency) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | |||
Net realized and unrealized gains and losses related to forward contracts | $0.50 | $0.60 | $0.90 |
Recovered_Sheet6
Summary of significant accounting policies (Employee Benefit Plans) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | |||
Contributions to voluntary 401(k) savings plans | $0.40 | $0.60 | $0.60 |
Summary_of_Property_and_Equipm
(Summary of Property and Equipment, RealD Cinema Systems and Digital Projectors) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | $243,205 | $239,343 |
Less accumulated depreciation | -140,363 | -110,060 |
Property and equipment, RealD Cinema Systems and digital projectors, net | 102,842 | 129,283 |
RealD Cinema Systems | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 208,056 | 205,416 |
Digital projectors - held for sale | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 0 | 216 |
Leasehold improvements | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 16,974 | 16,935 |
Machinery and equipment | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 5,791 | 4,753 |
Furniture and fixtures | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 1,238 | 1,272 |
Computer equipment and software | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | 10,581 | 9,197 |
Construction in process | ||
Property and equipment, RealD Cinema Systems and digital projectors | ||
Property and equipment, RealD Cinema Systems and digital projectors, gross | $565 | $1,554 |
Cinema_Systems_and_Property_Eq2
Cinema Systems and Property & Equipment (Narrative) (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Property and equipment, RealD Cinema Systems and digital projectors | |||
Depreciation | $38,600,000 | $39,000,000 | $32,700,000 |
Proceeds from sale of digital projectors | 100,000 | 300,000 | |
Purchases of intangible assets | 63,000 | 551,000 | 2,474,000 |
Aggregate amount of non-cancellable purchase agreement for certain cinema systems configurations | 3,500,000 | ||
Impairment charges | $5,000,000 | $4,500,000 | $8,700,000 |
Goodwill_and_other_intangibles2
Goodwill and other intangibles, net (Summary of Goodwill and Intangible Assets) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Gross amount of acquired developed technologies | $9,324 | $9,324 |
Accumulated amortization of acquired developed technologies | 4,507 | 3,170 |
Goodwill | 10,657 | 10,657 |
Total | $19,981 | $19,981 |
Goodwill_and_other_intangibles3
Goodwill and other intangibles, net (Amortization Expense) (Details) (Minimum, USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Fiscal year 2016 | $1,303 |
Fiscal year 2017 | 1,300 |
Fiscal year 2018 | 1,287 |
Fiscal year 2019 | 306 |
Fiscal year 2020 | 129 |
Thereafter | 492 |
Total | $4,817 |
Goodwill_and_other_intangibles4
Goodwill and other intangibles, net (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $1.40 | $1.30 | $0.40 |
Weighted average remaining amortization period | 4 years 6 months 0 days | ||
2D-to-3D conversion patents | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets acquired | $6.10 | ||
Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 5 years | ||
Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 19 years |
Accrued_expenses_and_other_lia2
Accrued expenses and other liabilities (Accrued Expenses and Other LIabilities) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Payables and Accruals [Abstract] | ||
Payroll and compensation | $8,673 | $5,070 |
Sales, use taxes and other taxes | 6,317 | 6,582 |
Professional fees | 3,206 | 1,484 |
RealD Cinema system contractual obligations | 5,154 | 4,134 |
Other | 3,290 | 4,626 |
Total | $26,640 | $21,896 |
Accrued_expenses_and_other_lia3
Accrued expenses and other liabilities (Summary of Fiscal Year) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Restructuring Cost and Reserve [Line Items] | ||
Personnel | $771 | $4,628 |
Leasehold | 601 | 90 |
Total | 1,372 | 4,718 |
Cost of revenue | ||
Restructuring Cost and Reserve [Line Items] | ||
Personnel | 242 | 835 |
Leasehold | 601 | 13 |
Total | 843 | 848 |
Research and development | ||
Restructuring Cost and Reserve [Line Items] | ||
Personnel | 240 | 757 |
Leasehold | 0 | 0 |
Total | 240 | 757 |
Selling and marketing | ||
Restructuring Cost and Reserve [Line Items] | ||
Personnel | 97 | 1,830 |
Leasehold | 0 | 0 |
Total | 97 | 1,830 |
General and administrative | ||
Restructuring Cost and Reserve [Line Items] | ||
Personnel | 192 | 1,206 |
Leasehold | 0 | 77 |
Total | $192 | $1,283 |
Accrued_expenses_and_other_lia4
Accrued expenses and other liabilities (Summary of Actual and Estimated Activity) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Restructuring Reserve [Roll Forward] | ||
Cost reduction plan liabilities, beginning of period | $1,416 | $0 |
Restructuring charges | 1,372 | 4,718 |
(Payments) | -1,274 | -3,302 |
Cost reduction plan liabilities, end of period | 1,514 | 1,416 |
Employee severance | ||
Restructuring Reserve [Roll Forward] | ||
Cost reduction plan liabilities, beginning of period | 1,416 | 0 |
Restructuring charges | 771 | 4,628 |
(Payments) | -938 | -3,212 |
Cost reduction plan liabilities, end of period | 1,249 | 1,416 |
Lease | ||
Restructuring Reserve [Roll Forward] | ||
Cost reduction plan liabilities, beginning of period | 0 | 0 |
Restructuring charges | 601 | 90 |
(Payments) | -336 | -90 |
Cost reduction plan liabilities, end of period | $265 | $0 |
Accrued_expenses_and_other_lia5
Accrued expenses and other liabilities (Narrative) (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Restructuring Cost and Reserve [Line Items] | |||
(Gain) Loss on disposal of property and equipment | $5,023,000 | $4,522,000 | $8,679,000 |
Charges related to staff reduced | 771,000 | 4,628,000 | |
Charges related to manufacturing facilities not in operations | 601,000 | 90,000 | |
Restructuring charges | 6,100,000 | ||
Employee severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges related to staff reduced | 1,400,000 | 4,700,000 | |
Facility closing | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges related to manufacturing facilities not in operations | 300,000 | ||
Leasehold improvements | |||
Restructuring Cost and Reserve [Line Items] | |||
(Gain) Loss on disposal of property and equipment | $5,600,000 |
Borrowings_Current_and_NonCurr
Borrowings (Current and Non-Current Portion of the Credit Agreement) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ||
Current portion of Credit Agreement | $7,460 | $12,500 |
Credit Agreement, net of current portion | 22,380 | 23,750 |
Total Credit Agreement | $29,840 | $36,250 |
Borrowings_Future_Minimum_Cred
Borrowings (Future Minimum Credit Agreement Obligations) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ||
Fiscal year 2016 | $7,460 | |
Fiscal year 2017 | 7,460 | |
Fiscal year 2018 | 7,460 | |
Fiscal year 2019 | 7,460 | |
Total Credit Agreement | $29,840 | $36,250 |
Borrowings_Narrative_Details
Borrowings (Narrative) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 3 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | Jun. 26, 2014 | Mar. 31, 2015 | |
Borrowings | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Four | $7,460,000 | $7,460,000 | |||
Repayments of Long-term Lines of Credit | 43,710,000 | 48,750,000 | 37,500,000 | ||
Unamortized Debt Issuance Expense | 900,000 | 900,000 | |||
Long-term Line of Credit | 29,840,000 | 36,250,000 | 29,840,000 | ||
Repayments of long-term debt | 37,300,000 | 37,500,000 | 60,000,000 | ||
Available borrowing capacity | 62,700,000 | 62,700,000 | |||
Revolving Facility | |||||
Borrowings | |||||
Line of Credit Facility, Current Borrowing Capacity | 50,000,000 | ||||
Line Of Credit Facility, Additional Amounts Available For Borrowings | 25,000,000 | ||||
Borrowing capacity | 75,000,000 | ||||
Interest expense | 1,600,000 | 1,800,000 | 1,100,000 | ||
Available borrowing capacity | 50,000,000 | 50,000,000 | |||
2012 Credit Agreement | |||||
Borrowings | |||||
Deferred Costs, Noncurrent | 300,000 | 300,000 | |||
Long-term Line of Credit | 36,300,000 | 47,500,000 | |||
Interest rate (as a percent) | 2.88% | 3.03% | |||
Term Loan Facility | |||||
Borrowings | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Four | 7,500,000 | 7,500,000 | |||
Borrowing capacity | 50,000,000 | ||||
Number of installments for periodic payment of debt | 12 | ||||
Amount of periodic payment of debt | 1,900,000 | ||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.38% | ||||
Repayments of long-term debt | 37,300,000 | ||||
Available borrowing capacity | 12,700,000 | 12,700,000 | 12,700,000 | ||
2014 Credit Agreement | |||||
Borrowings | |||||
Debt issuance costs | 900,000 | ||||
Long-term Line of Credit | $29,800,000 | $29,800,000 | |||
Interest rate (as a percent) | 2.44% | 2.44% | |||
2014 Credit Agreement | Federal Funds Effective Swap Rate [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 0.50% | ||||
2014 Credit Agreement | Eurocurrency Rate For a One Month Interest Period [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 1.00% | ||||
Minimum | Revolving Facility | |||||
Borrowings | |||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.25% | ||||
Minimum | 2014 Credit Agreement | |||||
Borrowings | |||||
Commitment fee (as a percent) | 2.25% | ||||
Minimum | 2014 Credit Agreement | Eurodollar [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 2.25% | ||||
Minimum | 2014 Credit Agreement | Eurocurrency Rate For a One Month Interest Period [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 1.25% | ||||
Maximum | Revolving Facility | |||||
Borrowings | |||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.38% | ||||
Maximum | 2014 Credit Agreement | |||||
Borrowings | |||||
Commitment fee (as a percent) | 2.75% | ||||
Maximum | 2014 Credit Agreement | Eurodollar [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 2.75% | ||||
Maximum | 2014 Credit Agreement | Eurocurrency Rate For a One Month Interest Period [Member] | |||||
Borrowings | |||||
Interest rate added to base rate (as a percent) | 1.75% |
Commitments_and_contingencies_1
Commitments and contingencies (Summary of Future Minimum Lease Obligations) (Details) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
Fiscal year 2016 | $4,313 |
Fiscal year 2017 | 4,019 |
Fiscal year 2018 | 4,076 |
Fiscal year 2019 | 4,082 |
Fiscal year 2020 | 4,203 |
Thereafter | 10,710 |
Total | $31,403 |
Commitments_and_contingencies_2
Commitments and contingencies (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||
Rent expense | $6.80 | $6.60 | $5.20 |
Purchase Commitment | |||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||
Future obligations | $13.70 | ||
Revolving supply commitments | 90 days | ||
Maximum | Purchase Commitment | |||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |||
Payment required under the cancellation penalty provisions as a percentage of the unused contract | 20.00% |
Equity_Summary_of_Shares_Rever
Equity (Summary of Shares Reversed for Future Issuance) (Details) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Equity | |
Shares reversed for future issuance | 15,558 |
Restricted stock units | |
Equity | |
Shares reversed for future issuance | 1,524 |
Performance stock options | |
Equity | |
Shares reversed for future issuance | 236 |
Performance stock unit | |
Equity | |
Shares reversed for future issuance | 1,029 |
Stock option plan | |
Equity | |
Outstanding | 6,804 |
Reserved for future issuance | 5,965 |
Equity_Narrative_Details
Equity (Narrative) (Details) (USD $) | 0 Months Ended | 12 Months Ended | |||
Dec. 14, 2012 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | Apr. 20, 2012 | |
Equity [Abstract] | |||||
Value of common stock authorized to be repurchased | $75,000,000 | $50,000,000 | |||
Increase in the value of common stock authorized to be repurchased | 25,000,000 | ||||
Number of shares of common stock repurchased | 6,599,726 | 671,997 | 5,927,729 | ||
Average cost per share | $10.30 | $11.18 | $10.20 | ||
Value of common stock repurchased | $67,900,000 | $7,511,000 | $60,445,000 |
Sharebased_compensation_Compon
Share-based compensation (Components of Share-Based Compensation Expense) (Details) (USD $) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $14,898,000 | $17,741,000 | $18,474,000 |
Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 1,212,000 | 865,000 | 807,000 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 3,227,000 | 2,708,000 | 2,185,000 |
Selling and marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | 3,017,000 | 5,543,000 | 5,258,000 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Share-based compensation expense | $7,442,000 | $8,625,000 | $10,224,000 |
Sharebased_compensation_ShareB
Share-based compensation (Share-Based Compensation Expense Related to Stock Options) (Details) (Stock options, USD $) | 12 Months Ended |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 |
Stock options | |
Options | |
Outstanding at the beginning of the period (in shares) | 7,811,000 |
Granted | 602,000 |
Exercised | -779,000 |
Forfeited or expired | -830,000 |
Outstanding at the end of the period (in shares) | 6,804,000 |
Exercisable at March 31, 2015 | 5,689,000 |
Vested or expected to vest | 6,694,000 |
Weighted- average exercise price | |
Outstanding at the beginning of the period (in dollars per share) | $13.11 |
Granted | $11.25 |
Exercised | $4.58 |
Forfeited or expired | $15.08 |
Outstanding at the end of the period (in dollars per share) | $13.68 |
Exercisable at March 31, 2015 | $13.97 |
Vested or expected to vest | $13.76 |
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures [Abstract] | |
Outstanding | 5 years 7 months 24 days |
Remaining contractual term exercisable at end of period (in years) | 5 years 1 month 20 days |
Remaining contractual term vested or expected to vest (in years) | 5 years 7 months 16 days |
Aggregate intrinsic value outstanding end of period | $14,309 |
Aggregate intrinsic value exercisable at end of period | 11,486 |
Aggregate intrinsic value vested or expected to vest | $13,083 |
Sharebased_compensation_Weight
Share-based compensation (Weighted-Average Grant Date Fair Values) (Details) (Stock options, USD $) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Stock options | |||
Share-based compensation | |||
Fair value of stock options granted | $5.90 | $7.20 | $6.20 |
Expected volatility | 55.00% | 60.00% | 60.00% |
Expected term (years) | 5 years 11 months 29 days | 6 years | 6 years |
Risk-free rate | 1.20% | 1.40% | 1.00% |
Sharebased_compensation_Perfor
Share-based compensation (Performance Stock Option Activity) (Details) (Performance stock options, USD $) | 12 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Performance stock options | ||
Options | ||
Outstanding at the beginning of the period (in shares) | 686,000 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited or expired | 0 | |
Outstanding at the end of the period (in shares) | 686,000 | 686,000 |
Weighted- average exercise price | ||
Outstanding at the beginning of the period (in dollars per share) | $14.98 | |
Granted | $0 | |
Exercised | $0 | |
Forfeited or expired | $0 | |
Outstanding at the end of the period (in dollars per share) | $14.98 | $14.98 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term | 0 days | |
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures [Abstract] | ||
Outstanding | 6 years 3 months 18 days | 7 years 3 months 14 days |
Sharebased_compensation_Summar
Share-based compensation (Summary of Restricted Stock Units) (Details) (Restricted stock units, USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||
Nonvested at the beginning of the year (in shares) | 479 | |
Granted (in shares) | 1,303 | 600 |
Vested (in shares) | -327 | |
Forfeited (in shares) | -215 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 1,240 | 479 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||
Nonvested at the beginning of the year (in dollars per share) | $13.13 | |
Granted (in dollars per share) | $11.27 | $12.29 |
Vested (in dollars per share) | $12.16 | |
Forfeited (in dollars per share) | $11.61 | |
Nonvested at the end of the year (in dollars per share) | $11.69 | $13.13 |
Sharebased_compensation_Narrat
Share-based compensation (Narrative) (Details) (USD $) | 12 Months Ended | ||
Share data in Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Share-based compensation | |||
Share-based compensation expense | $14,898,000 | $17,741,000 | $18,474,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | 7,000,000 | ||
Employee Stock | |||
Share-based compensation | |||
Share-based compensation expense | 100,000 | ||
Stock options | |||
Share-based compensation | |||
Vesting period | 4 years | ||
Percentage of shares that vest after one year from the date of grant | 25.00% | ||
Period from grant date after which awards begin to vest | 1 year | ||
Term of options | 10 years | ||
Share-based compensation expense | 7,200,000 | 13,800,000 | 14,200,000 |
Total intrinsic value of options exercised (in dollars) | 6,400,000 | 4,900,000 | 2,600,000 |
Expected dividends (as a percent) | 0.00% | ||
Remaining weighted-average period for recognition | 2 years 1 month 20 days | ||
Performance stock options | |||
Share-based compensation | |||
Share-based compensation expense | 700,000 | 500,000 | 1,900,000 |
Performance period | 3 years | ||
Performance Shares [Member] | |||
Share-based compensation | |||
Share-based compensation expense | 1,485,317 | 3,300,000 | 0 |
Performance period | 2 years | ||
Granted (in shares) | 652 | ||
Granted (in dollars per share) | $11.46 | ||
Restricted stock units | |||
Share-based compensation | |||
Share-based compensation expense | 5,300,000 | 3,300,000 | |
Total unrecognized compensation costs (in dollars) | 14,500,000 | ||
Remaining weighted-average period for recognition | 3 years 1 month 6 days | ||
Granted (in shares) | 1,303 | 600 | |
Granted (in dollars per share) | $11.27 | $12.29 | |
Fair values of restricted stock units vested (in dollars) | $4,000,000 | $2,500,000 | $2,200,000 |
Minimum | Performance stock options | |||
Share-based compensation | |||
Performance period | 3 years | ||
Minimum | Performance Shares [Member] | |||
Share-based compensation | |||
Percentage of options earned depending on outcome of performance goals | 0.00% | ||
Minimum | Restricted stock units | |||
Share-based compensation | |||
Vesting period | 1 year | ||
Maximum | Performance stock options | |||
Share-based compensation | |||
Performance period | 5 years | ||
Maximum | Performance Shares [Member] | |||
Share-based compensation | |||
Percentage of options earned depending on outcome of performance goals | 200.00% | ||
Maximum | Restricted stock units | |||
Share-based compensation | |||
Vesting period | 3 years |
Sharebased_compensation_Perfor1
Share-based compensation Performance Stock Unit Activity (Details) (Performance Shares [Member], USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Performance Shares [Member] | ||
Share-based compensation | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding, Number | 450 | 668 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $12.23 | $14.96 |
Granted (in shares) | 652 | |
Granted (in dollars per share) | $11.46 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | -129 | |
Vested (in dollars per share) | $11.46 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures and Expirations in Period | -741 | |
Forfeited (in dollars per share) | $14.15 |
Income_taxes_Income_Tax_Provis
Income taxes (Income Tax Provision From Continuing Operations) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Current income tax provision: | |||
Federal | $0 | $0 | $0 |
State | 47 | 132 | 103 |
Foreign | 7,458 | 6,128 | 5,202 |
Total current income tax provision | 7,505 | 6,260 | 5,305 |
Deferred income tax benefit: | |||
Federal | 0 | 0 | 0 |
State | 0 | 0 | 0 |
Foreign | 404 | -143 | -241 |
Total income tax provision from continuing operations | $7,909 | $6,117 | $5,064 |
Income_taxes_Income_Loss_From_
Income taxes (Income Loss From Continuing Operations) (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Income Tax Disclosure [Abstract] | |||
United States | ($23,020) | ($11,224) | ($6,963) |
Foreign | 7,182 | 6,131 | 2,140 |
Loss before income taxes | ($15,838) | ($5,093) | ($4,823) |
Income_taxes_Significant_Compo
Income taxes (Significant Components of Deferred Tax Balances) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ||
Net operating loss carryforwards | $28,180 | $24,971 |
Deferred revenues | 1,288 | 2,708 |
Accruals, reserves and allowances | 6,828 | 7,698 |
Stock compensation | 16,936 | 15,796 |
Foreign tax credit carryovers | 18,781 | 15,181 |
Partnership interest | 6 | 44 |
Other | 1,353 | 1,445 |
Total deferred tax assets | 73,372 | 67,843 |
Deferred Tax Liabilities, Gross [Abstract] | ||
Fixed assets | -12,876 | -15,020 |
Intangible assets | -150 | -118 |
Unbilled receivables | -3,230 | -5,821 |
Other | -565 | -426 |
Total deferred tax liabilities | -16,821 | -21,385 |
Valuation allowance | -56,673 | -46,175 |
Net deferred tax assets (liabilities) | ($122) | $283 |
Income_taxes_Valuation_Allowan
Income taxes (Valuation Allowance Increase) (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Taxes [Line Items] | ||
Increase in valuation allowance | $10,498 | $7,091 |
Continuing Operations | ||
Income Taxes [Line Items] | ||
Increase in valuation allowance | $10,498 | $7,091 |
Income_taxes_Income_Tax_Provis1
Income taxes (Income Tax Provision vs Federal Income Tax Rate) (Details) | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Income Tax Disclosure [Abstract] | ||||
Federal tax at statutory rate | 34.00% | 34.00% | 34.00% | 34.00% |
State tax, net of federal benefit | 2.70% | -1.40% | -7.70% | |
Foreign tax rate differential | 4.50% | 8.60% | 2.90% | |
LLC income minority interest not taxed | 0.20% | 1.40% | -1.30% | |
Revaluation of deferred taxes due to changes in effective income tax rates | -0.60% | -0.80% | 3.80% | |
Foreign withholding taxes (credits) | 0.00% | -0.90% | 0.00% | |
Permanent differences and other | -17.80% | 15.20% | 3.70% | |
Stock compensation | -4.50% | -37.00% | -34.90% | |
Change in valuation allowance | -68.40% | -139.00% | -105.50% | |
Total tax benefit | -49.90% | -119.90% | -105.00% |
Income_taxes_Activity_Related_
Income taxes (Activity Related to Unrecognized Tax Benefits) (Details) (USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Balance at the beginning of the year | $346 |
Increases related to prior year tax positions | 0 |
Increase related to current year tax positions | 0 |
Expiration of the statute of limitations for the assessment of taxes | 0 |
Settlements | 0 |
Balance at the end of the year | $346 |
Income_taxes_Narrative_Details
Income taxes (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Operating Loss Carryforwards [Line Items] | ||||
Federal tax at statutory rate | 34.00% | 34.00% | 34.00% | 34.00% |
Unrealized excess tax benefits associated with share-based compensation and exhibitor options | $23 | |||
Unrecognized tax benefits that will decrease the effective tax rate if recognized | 0.3 | |||
Federal | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 133.7 | |||
Tax on unremitted earnings of the subsidiary outside of the United States | 38.5 | |||
State | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | 70.1 | |||
Foreign | ||||
Operating Loss Carryforwards [Line Items] | ||||
Foreign tax credit carryforwards | $18.80 |
Relatedparty_transactions_Narr
Related-party transactions (Narrative) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | 19-May-11 | Mar. 31, 2013 | 29-May-12 | Mar. 31, 2013 | Jul. 16, 2011 | |
installment | |||||||
Related Party Transaction [Line Items] | |||||||
Amount of related party transactions | $0 | $0 | |||||
Joshua Greer | |||||||
Related Party Transaction [Line Items] | |||||||
Cash severance amount | 450,000 | ||||||
Number of equal installments of cash severance to be paid | 10 | ||||||
Maximum period of reimbursement by the entity for insurance coverage under COBRA under the terms of the separation agreement | 18 months | ||||||
Pro-rated cash performance bonus as a percentage of salary to be paid pursuant to the terms of the separation agreement | 30.00% | ||||||
Percentage of annual salary used for determining pro-rated cash performance bonus | 80.00% | ||||||
Amount to be paid annually as per the consulting agreement | 275,000 | ||||||
Amount paid pursuant to the separation agreement | 225,000 | ||||||
Amount paid pursuant to the consulting agreement | 148,958 | ||||||
DCH | |||||||
Related Party Transaction [Line Items] | |||||||
Tenure of agreement | 4 months | ||||||
Fixed monthly compensation payable per agreement | 20,000 | ||||||
Notice period for additional extension to the tenure of agreement | 10 days | ||||||
Compensation paid | $80,239 | ||||||
Time-based vesting stock option | Joshua Greer | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares which had vesting periods accelerated under the terms of the separation agreement | 105,000 | ||||||
Term of exercising options following the end of the term of the consulting agreement | 6 months | ||||||
Second stock option | Joshua Greer | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares forfeited pursuant to the terms of the separation agreement | 105,000 | ||||||
Minimum | DCH | |||||||
Related Party Transaction [Line Items] | |||||||
Number of applications for which consulting services provided | 1 | ||||||
Maximum | DCH | |||||||
Related Party Transaction [Line Items] | |||||||
Additional extension to the tenure of agreement | 2 months |
Segment_and_geographic_informa2
Segment and geographic information (Revenue by Geographic Region) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenues | $27,905 | $32,571 | $47,768 | $55,219 | $40,648 | $55,438 | $43,929 | $59,219 | $163,463 | $199,234 | $215,552 |
Domestic (United States and Canada) | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenues | 71,081 | 96,159 | 106,979 | ||||||||
China | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenues | 19,243 | 16,642 | 8,615 | ||||||||
Rest Of The World | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total revenues | $73,139 | $86,433 | $99,958 |
Segment_and_geographic_informa3
Segment and geographic information (Intangible Assets) (Details) (USD $) | Mar. 31, 2015 | Mar. 31, 2014 |
In Thousands, unless otherwise specified | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived tangible assets | $102,842 | $129,283 |
Domestic (United States and Canada) | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived tangible assets | 87,134 | 105,708 |
CHINA | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived tangible assets | 10,185 | 8,085 |
Rest Of The World | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived tangible assets | $5,523 | $15,490 |
Segment_and_geographic_informa4
Segment and geographic information (Narrative) (Details) | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Customers | Customers | Customers | |
Concentration Risk [Line Items] | |||
Number of reportable segments | 1 | ||
Number of operating segments | 3 | ||
Accounts receivable | Credit concentration | Top ten customers | |||
Concentration Risk [Line Items] | |||
Number of customers aggregated for disclosure of concentration risk | 10 | 10 | |
Percentage of concentration risk | 25.00% | 47.00% | |
Revenue | Customer concentration | Top ten customers | |||
Concentration Risk [Line Items] | |||
Number of customers aggregated for disclosure of concentration risk | 10 | 10 | 10 |
Percentage of concentration risk | 55.00% | 46.00% | 44.00% |
Licenses Revenue | Customer concentration | |||
Concentration Risk [Line Items] | |||
Number of licensees | 2 | 2 | 0 |
Licenses Revenue | Customer concentration | Licensee Two | |||
Concentration Risk [Line Items] | |||
Percentage of concentration risk | 11.00% | 13.00% | |
Licenses Revenue | Customer concentration | Licensee One | |||
Concentration Risk [Line Items] | |||
Percentage of concentration risk | 15.00% | 14.00% |
Quarterly_financial_data_Sched
Quarterly financial data (Schedule of Quarterly Financial Data ) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net revenue | $27,905 | $32,571 | $47,768 | $55,219 | $40,648 | $55,438 | $43,929 | $59,219 | $163,463 | $199,234 | $215,552 |
Gross profit | 10,242 | 14,963 | 25,552 | 30,021 | 19,902 | 27,270 | 19,906 | 28,181 | 80,778 | 95,259 | 90,192 |
Net loss | -17,635 | -11,290 | -751 | 5,929 | -4,855 | -155 | -4,664 | -1,536 | -23,747 | -11,210 | -9,887 |
Net income (loss) attributable to RealD Inc. common stockholders | ($17,710) | ($11,290) | ($751) | $5,929 | ($4,950) | ($271) | ($4,651) | ($1,534) | ($23,822) | ($11,406) | ($9,690) |
Loss per common share: | |||||||||||
Basic (in dollars per share) | ($0.36) | ($0.23) | ($0.02) | $0.12 | ($0.10) | ($0.01) | ($0.09) | ($0.03) | ($0.48) | ($0.23) | ($0.19) |
Diluted (in dollars per share) | ($0.36) | ($0.23) | ($0.02) | $0.11 | ($0.10) | ($0.01) | ($0.09) | ($0.03) | ($0.48) | ($0.23) | ($0.19) |
Quarterly_financial_data_Summa
Quarterly financial data (Summary of Changes in Reporting Periods) (Details 2) | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 21, 2012 | Jun. 22, 2012 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Reporting Periods | |||||||||||||||
Number of days in reporting period | 90 days | 92 days | 92 days | 91 days | 90 days | 92 days | 92 days | 91 days | 90 days | 101 days | 91 days | 91 days | 365 days | 365 days | 373 days |
Number of days change | 0 days | 0 days | 0 days | 0 days | 0 years | 9 years | 1 year | 0 years | 0 days | 8 years | |||||
Percentage change | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | -8.90% | 1.10% | 0.00% | 0.00% | -2.10% |
SCHEDULE_IIVALUATION_AND_QUALI1
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 |
Allowance for doubtful accounts and customer credits | |||
Valuation allowances | |||
Balance at beginning of period | $4,086 | $2,649 | $4,224 |
Additions charged to cost and expenses | 4,701 | 2,389 | 0 |
Other Adjustments/Deductions | -2,922 | -952 | -1,575 |
Balance at end of period | 5,865 | 4,086 | 2,649 |
Deferred tax valuation allowance | |||
Valuation allowances | |||
Balance at beginning of period | 46,175 | 39,084 | 33,994 |
Additions charged to cost and expenses | 7,091 | 5,090 | |
Other Adjustments/Deductions | 0 | 0 | 0 |
Balance at end of period | $56,673 | $46,175 | $39,084 |