Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 14, 2015 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | JRjr33, Inc. | |
Entity Central Index Key | 1,403,085 | |
Document Type | 10-Q/A | |
Document Period End Date | Jun. 30, 2015 | |
Amendment Flag | true | |
Amendment Description | Subsequent to the filing of our Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, management identified certain year end accounting adjustments. Management evaluated these adjustments and their effects on the Company's 2015 previously-filed quarterly financial statements and determined restated consolidated financial statements should be filed to correct errors within our originally reported financial statements as of and for the three months and six months ended June 30, 2015. | |
Current Fiscal Year End Date | --12-31 | |
Trading Symbol | JRJR | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 34,367,095 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 5,713 | $ 2,606 |
Marketable securities | 5,967 | 991 |
Accounts receivable, net | 4,316 | 450 |
Inventory, net | 20,191 | 14,759 |
Other current assets | 3,104 | 2,482 |
Total current assets | 39,291 | 21,288 |
Restricted cash | 3,026 | 0 |
Sale leaseback security deposit | 4,414 | 4,414 |
Property, plant and equipment, net | 8,429 | 8,191 |
Leased property, net | 14,834 | 15,361 |
Goodwill | 5,242 | 4,095 |
Intangibles, net | 3,713 | 3,558 |
Other assets | 353 | 400 |
Total assets | 79,302 | 57,307 |
Current liabilities: | ||
Accounts payable | 12,714 | 8,541 |
Related party payables | 1,421 | 152 |
Accrued commissions | 4,179 | 3,319 |
Accrued liabilities | 8,094 | 4,612 |
Deferred revenue | 1,763 | 2,982 |
Current portion of long-term debt | 914 | 941 |
Taxes payable | 3,907 | 2,693 |
Other current liabilities | 2,952 | 1,412 |
Total current liabilities | 35,944 | 24,652 |
Deferred tax liability | 0 | 167 |
Long-term debt, net of current portion | 7,015 | 4,316 |
Lease liability, net of current portion | 15,765 | 15,774 |
Other long-term liabilities | 2,353 | 3,415 |
Total liabilities | 61,077 | 48,324 |
Commitments & contingencies | ||
Stockholders' equity: | ||
Preferred stock, par value $0.001 per share, 500,000 authorized | 0 | 0 |
Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively | 4 | 3 |
Additional paid-in capital | 55,468 | 37,097 |
Accumulated other comprehensive income | 37 | 321 |
Accumulated deficit | (39,304) | (32,159) |
Total stockholders' equity attributable to JRjr33, Inc. | 16,205 | 5,262 |
Stockholders' equity attributable to non-controlling interest | 2,020 | 3,721 |
Total stockholders' equity | 18,225 | 8,983 |
Total liabilities and stockholders' equity | $ 79,302 | $ 57,307 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 34,367,095 | 27,599,012 |
Common stock, shares outstanding (in shares) | 34,367,095 | 27,599,012 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Statement [Abstract] | ||||
Revenue | $ 36,028 | $ 24,586 | $ 55,906 | $ 51,257 |
Program costs and discounts | (6,374) | (5,220) | (9,626) | (10,196) |
Net revenue | 29,654 | 19,366 | 46,280 | 41,061 |
Costs of sales | 11,110 | 5,863 | 16,340 | 13,879 |
Gross profit | 18,544 | 13,503 | 29,940 | 27,182 |
Commissions and incentives | 8,447 | 6,005 | 14,268 | 12,978 |
Gain on sale of assets | (40) | (141) | (83) | (407) |
Selling, general and administrative | 12,761 | 10,990 | 23,462 | 19,991 |
Depreciation and amortization | 492 | 445 | 771 | 1,066 |
Share based compensation expense | (30) | 311 | (1,197) | 398 |
Impairment of goodwill | 192 | 0 | 192 | 0 |
Operating loss | (3,278) | (4,107) | (7,473) | (6,844) |
Loss (gain) on marketable securities | 0 | 58 | (192) | 552 |
Interest expense, net | 565 | 213 | 1,164 | 479 |
Loss from operations before income tax provision | (3,843) | (4,378) | (8,445) | (7,875) |
Income tax provision | 195 | 213 | 386 | 492 |
Net loss | (4,038) | (4,591) | (8,831) | (8,367) |
Net loss attributable to non-controlling interest | 1,016 | 1,046 | 1,686 | 1,686 |
Net loss attributable to JRjr33, Inc. | $ (3,022) | $ (3,545) | $ (7,145) | $ (6,681) |
Basic and diluted loss per share: | ||||
Weighted average common shares outstanding (in shares) | 34,367,095 | 24,400,893 | 32,017,582 | 24,403,486 |
Loss per common share attributable to common stockholders, basic and diluted (in dollars per share) | $ (0.09) | $ (0.15) | $ (0.22) | $ (0.27) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (4,038) | $ (4,591) | $ (8,831) | $ (8,367) |
Other comprehensive gain, net of tax: | ||||
Unrealized holding gain arising during the period | 0 | 184 | 7 | 653 |
Reclassification of other comprehensive loss included in net loss | 0 | 0 | (199) | 0 |
Foreign currency translation adjustment gain (loss) | (266) | 44 | (92) | 34 |
Other comprehensive gain (loss) | (266) | 228 | (284) | 687 |
Comprehensive loss | (4,304) | (4,363) | (9,115) | (7,680) |
Comprehensive loss attributable to non-controlling interests | 1,016 | 1,046 | 1,686 | 1,686 |
Comprehensive loss attributable to JRjr33, Inc. | $ (3,288) | $ (3,317) | $ (7,429) | $ (5,994) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Operating activities: | ||
Net loss | $ (8,831) | $ (8,367) |
Adjustments to reconcile net loss to net cash used in operating activities net of effect of acquisitions | ||
Depreciation and amortization | 1,053 | 1,224 |
Loss (gain) on sale of marketable securities | (192) | 552 |
Interest expense | 0 | 400 |
Share-based compensation | (1,197) | 398 |
Provision for doubtful accounts | 331 | 140 |
Provision for obsolete inventory | 0 | 41 |
Gain on sales of assets | (83) | (407) |
Deferred income tax | 73 | 89 |
Goodwill impairment | 192 | 0 |
Non-cash compensation | 201 | 0 |
Changes in certain assets and liabilities: | ||
Accounts receivable | (1,034) | (136) |
Inventory | 1,000 | 1,182 |
Other current assets | 628 | (161) |
Accounts payable | (1,139) | (168) |
Related party payables | 1,268 | (277) |
Accrued commissions | 863 | 666 |
Accrued liabilities | 2,002 | (100) |
Deferred revenue | (468) | 1,289 |
Taxes payable | (618) | 811 |
Other liabilities | (450) | (2,187) |
Net cash used in operating activities | (6,401) | (5,011) |
Investing activities: | ||
Capital expenditures | (332) | (645) |
Proceeds from the sale of property, plant and equipment | 60 | 1,831 |
Purchase of marketable securities | (18,876) | 0 |
Sale of marketable securities | 13,901 | 6,238 |
Proceeds from note receivable | 2 | 0 |
Deposit of restricted cash collateral | (2,931) | 0 |
Acquisitions, net of cash purchased | (3,135) | 2 |
Net cash provided by (used in) investing activities | (11,311) | 7,426 |
Financing activities: | ||
Net borrowings on long-term debt and revolving credit facility | 3,051 | 42 |
Payments on debt | (471) | (2,662) |
Stock issuances | 18,434 | 0 |
Net cash provided by (used in) financing activities | 21,014 | (2,620) |
Effect of exchange rate changes on cash and cash equivalents | (195) | 505 |
Increase in cash and cash equivalents | 3,107 | 300 |
Cash and cash equivalents at beginning of period | 2,606 | 3,877 |
Cash and cash equivalents at end of period | 5,713 | 4,177 |
Cash paid during the period for: | ||
Interest | 1,164 | 130 |
Income taxes | $ 313 | $ 517 |
General
General | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
General | General Interim Financial Information The accompanying unaudited condensed consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to those rules and regulations. The Company believes that the disclosures made are adequate to make the information presented not misleading. The accompanying unaudited interim condensed consolidated financial statements of the Company reflect all adjustments which, in the opinion of management, are necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods on a consistent basis with the annual audited financial statements. All such adjustments are of a normal recurring nature. The results of operations for interim periods are not necessarily indicative of the results that may be expected for any other interim period or that of a full year. The Condensed Consolidated Balance Sheet at December 31, 2014 is derived from the December 31, 2014 audited financial statements. These condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements included in our Annual Report on Form 10-K/A filed for the year ended December 31, 2014, filed with the SEC on March 23, 2015 ("Form 10-K/A"). All significant intercompany accounts and transactions have been eliminated in these condensed consolidated financial statements. Business combinations accounted for as purchases are included in the condensed consolidated financial statements from their respective dates of acquisition. Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies during the six months ended June 30, 2015 , as compared with those disclosed in the Company’s consolidated financial statements in the Annual Report on Form 10-K/A for the year ended December 31, 2014. Reclassifications Prior period financial statement amounts have been reclassified to conform to current period presentation. Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates are based on information available as of the date of the consolidated financial statements. Actual results could differ significantly from those estimates. Accounts Receivable The carrying value of our accounts receivable, net of allowance for doubtful accounts, represents their estimated net realizable value. We estimate the allowance for doubtful accounts based on type of customer, age of outstanding receivable, historical collection trends, and existing economic conditions. If events or changes in circumstances indicate that a specific receivable balance may be unrealizable, further consideration is given to the collectability of those balances, and the allowance is adjusted accordingly. Receivable balances deemed uncollectible are written off against the allowance. We have recorded an allowance for doubtful accounts of $412,000 and $170,000 as of June 30, 2015 and December 31, 2014 , respectively. Income Taxes The Company and its U.S. subsidiaries (excluding The Longaberger Company) file a consolidated Federal income tax return. Deferred income taxes are provided for temporary differences between financial statement and tax bases of asset and liabilities. Benefits from tax credits are reflected currently in earnings. We record income tax positions based on a more likely than not threshold that the tax positions will be sustained on examination by the taxing authorities having full knowledge of all relevant information. Translation of Foreign Currencies The functional currency of our foreign subsidiaries is the local currency of their country of domicile. Assets and liabilities of the foreign subsidiaries are translated into U.S. dollar amounts at period-end exchange rates. Revenue and expense accounts are translated at the weighted-average rates for the quarterly accounting period to which they relate. Equity accounts are translated at historical rates. Foreign currency translation adjustments are accumulated as a component of other comprehensive income. Management has determined the functional currency of each primary operating subsidiary by evaluating indicators such as cash flows, sales prices, sales markets, expenses, financing, and intra-entity transactions and arrangements. We have listed below our primary operating subsidiaries for each of our companies and their functional and reporting currencies. Subsidiary Functional Currency Reporting Currency The Longaberger Company ( "Longaberger" or “TLC”) USD USD Uppercase Acquisition, Inc. ("UAI") USD USD CVSL TBT LLC ("Tomboy Tools" or "TBT") USD USD My Secret Kitchen, Ltd. ("MSK") GBP USD Your Inspiration At Home Pty Ltd. ("YIAH") AUD USD Paperly, Inc. USD USD Happenings Communications Group, Inc. ("HCG") USD USD Agel Enterprises Inc. ("AEI") USD USD Kleeneze Ltd. GBP USD Revenue Recognition and Deferred Revenue In the ordinary course of business we receive payments, primarily via credit card, for the sale of products at the time customers place orders. Sales and related fees such as shipping and handling, net of applicable sales discounts, are recorded as revenue when the product is shipped and when title and the risk of ownership passes to the customer. The Company presents revenues net of any taxes collected from customers which are remitted to governmental authorities. Payments received for undelivered products are recorded as deferred revenue and are included in current liabilities on the Company’s consolidated balance sheets. Certain incentives offered on the sale of our products, including sales discounts, described in the paragraph below are classified as program costs and discounts. A provision for product returns and allowances is recorded and is founded on historical experience and is classified as a reduction of revenues. At June 30, 2015 and 2014 , our provision for sales returns totaled $440,000 and $227,000 , respectively. Recent Accounting Pronouncements In January 2015 the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2015-01 (ASU 2015-01), Income Statement - Extraordinary Items and Unusual Items . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. ASU 2015-01 eliminates the concept of extraordinary items from GAAP. We are in the process of assessing the effects of the application of the new guidance on our financial statements. In February 2015 the FASB issued Accounting Standards Update 2015-02 (ASU 2015-02), Amendments to the Consolidation Analysis . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. The new consolidation standard changes the criteria a reporting enterprise uses to evaluate if certain legal entities, such as limited partnerships and similar entities, should be consolidated. We are in the process of assessing the effects of the application of the new guidance on our financial statements. In April 2015 the FASB issued Accounting Standards Update 2015-03 (ASU 2015-03), Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. The new standard requires debt issuance costs to be classified as reductions to the face value of the related debt. We do not expect ASU 2015-03 to materially affect our financial position until we issue new debt. In July 2015, the FASB issued Accounting Standards Update 2015-11 (ASU 2015-11) to simplify the subsequent measurement of inventory. The new standard requires that inventory be measured at the lower of cost or net realizable value. The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2016. Early application is permitted as of the beginning of an interim or annual reporting period. |
Restatement of Condensed Consol
Restatement of Condensed Consolidated Financial Statements | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Restatement of Condensed Consolidated Financial Statements | Restatement of Condensed Consolidated Financial Statements Correction of Accounting Errors During the course of the filing of our Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, management identified certain year-end accounting adjustments. Management evaluated these adjustments and their effects on the Company's 2015 previously-filed quarterly financial statements, as amended, and determined restated condensed consolidated financial statements should be filed to correct errors within our originally reported financial statements as of and for the three and six months ended June 30, 2015 . The most significant errors identified during the preparation of the Company's December 31, 2015 consolidated financial statements that affected the three and six month period ended June 30, 2015 include the following: • The correction of errors related to the recognition of revenue, accounts receivable and deferred revenue. The Company did not have the adequate accounting procedures to appropriately recognize and record revenues, accounts receivable and deferred revenue appropriately during Fiscal 2015. • The correction of errors related to the appropriate recognition of share-based compensation expense. The Company did not appropriately account for certain share-based compensation plans, which required adjustments to the quarterly financial statements. • The correction of errors related to the appropriate recognition of commissions expense on a quarterly basis. The Company did not appropriately calculate commissions expense related to the sales on a quarterly basis, which required an adjustment to the quarterly financial statements. • The Company did not appropriately account for certain expenses attributable to acquisitions costs, which were incorrectly recorded a related party accounts receivable, which required an adjustment to the quarterly financial statements. • The correction of errors related to the identification of assets included in cash and cash equivalents. The Company did not appropriately classify in transit receivables as accounts receivables during the year ended December 31, 2015. Other Restatement and Reclassification Adjustments In addition to correcting the accounting errors discussed above, the restated condensed consolidated financial statements for the three and six months ended June 30, 2015 include adjustments for certain other accounting errors and reclassifications that were discovered subsequent to the issuance of the originally reported financial statements for the three and six months ended June 30, 2015 . This adjustments include the following: • Correcting the classification of revenues, program costs and discounts and commissions expense for certain of the subsidiaries. • Other adjustments to correct for differences related to the recording accounts payable, interest expense, accrued commissions and accounts receivable write-offs. JRjr33, Inc. Condensed Consolidated Balance Sheets (Unaudited) June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Assets Current assets: Cash and cash equivalents $ 6,436 $ (723 ) $ — $ 5,713 Marketable securities 5,967 — — 5,967 Accounts receivable, net 3,966 300 50 4,316 Inventory, net 20,289 (97 ) (1 ) 20,191 Other current assets 3,373 (117 ) (152 ) 3,104 Total current assets 40,031 (637 ) (103 ) 39,291 Restricted cash 3,027 (1 ) — 3,026 Sale leaseback security deposit 4,414 — — 4,414 Property, plant and equipment, net 8,429 — — 8,429 Leased property, net 14,834 — — 14,834 Goodwill 5,246 (4 ) — 5,242 Intangibles, net 3,458 255 — 3,713 Other assets 353 — — 353 Total assets $ 79,792 $ (387 ) $ (103 ) $ 79,302 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 12,515 $ 3 $ 196 $ 12,714 Related party payables 635 761 25 1,421 Line of credit 99 — (99 ) — Accrued commissions 4,056 — 123 4,179 Accrued liabilities 8,316 (79 ) (143 ) 8,094 Deferred revenue 2,490 (727 ) — 1,763 Current portion of long-term debt 949 (92 ) 57 914 Taxes payable 3,842 219 (154 ) 3,907 Other current liabilities 3,027 33 (108 ) 2,952 Total current liabilities 35,929 118 (103 ) 35,944 Long-term debt 7,015 — — 7,015 Lease liability 15,765 — — 15,765 Other long-term liabilities 2,353 — — 2,353 Total liabilities 61,062 118 (103 ) 61,077 Commitments & contingencies Stockholders' equity: Preferred stock, par value $0.001 per share, 500,000 authorized — — — — Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively 4 — — 4 Additional paid-in capital 55,468 — — 55,468 Accumulated other comprehensive (loss) income 174 (137 ) — 37 Accumulated deficit (38,730 ) (574 ) — (39,304 ) Total stockholders' equity attributable to JRJR33, Inc. 16,916 (711 ) — 16,205 Stockholders' equity attributable to non-controlling interest 1,814 206 — 2,020 Total stockholders' equity 18,730 (505 ) — 18,225 Total liabilities and stockholders' equity $ 79,792 $ (387 ) $ (103 ) $ 79,302 JRjr33, Inc. Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended June 30, 2015 (in thousands, except share and per share data) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Revenue $ 35,742 $ 77 $ 209 $ 36,028 Program costs and discounts (2,998 ) (602 ) (2,774 ) (6,374 ) Net revenue 32,744 (525 ) (2,565 ) 29,654 Costs of sales 10,955 466 (311 ) 11,110 Gross profit 21,789 (991 ) (2,254 ) 18,544 Commissions and incentives 12,612 (1,601 ) (2,564 ) 8,447 Gain on sale of assets (40 ) — — (40 ) Selling, general and administrative 12,026 425 310 12,761 Depreciation and amortization 678 (186 ) — 492 Share based compensation expense (1,197 ) 1,167 — (30 ) Impairment of goodwill 192 — — 192 Operating loss (2,482 ) (796 ) — (3,278 ) Interest expense, net 745 (180 ) — 565 Loss from operations before income tax provision (3,227 ) (616 ) — (3,843 ) Income tax provision 192 3 — 195 Net loss (3,419 ) (619 ) — (4,038 ) Net loss attributable to non-controlling interest 1,726 (710 ) — 1,016 Net loss attributable to JRjr33, Inc. $ (1,693 ) $ (1,329 ) $ — $ (3,022 ) Basic and diluted loss per share: Weighted average common shares outstanding 34,367,095 — — 34,367,095 Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.05 ) $ (0.04 ) $ — $ (0.09 ) Six Months Ended June 30, 2015 (in thousands, except share and per share data) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Revenue $ 54,961 $ 588 $ 357 $ 55,906 Program costs and discounts (5,160 ) (1,466 ) (3,000 ) (9,626 ) Net revenue 49,801 (878 ) (2,643 ) 46,280 Costs of sales 16,365 398 (423 ) 16,340 Gross profit 33,436 (1,276 ) (2,220 ) 29,940 Commissions and incentives 18,480 (1,569 ) (2,643 ) 14,268 Gain on sale of assets (83 ) — — (83 ) Selling, general and administrative 21,466 1,573 423 23,462 Depreciation and amortization 1,308 (537 ) — 771 Share based compensation expense (1,197 ) — — (1,197 ) Impairment of goodwill 192 — — 192 Operating loss (6,730 ) (743 ) — (7,473 ) Loss (gain) on sale of marketable securities 7 (199 ) — (192 ) Interest expense, net 1,341 (177 ) — 1,164 Loss from operations before income tax provision (8,078 ) (367 ) — (8,445 ) Income tax provision 386 — — 386 Net loss (8,464 ) (367 ) — (8,831 ) Net loss attributable to non-controlling interest 1,892 (206 ) — 1,686 Net loss attributable to JRjr33, Inc. $ (6,572 ) $ (573 ) $ — $ (7,145 ) Basic and diluted loss per share: Weighted average common shares outstanding 32,017,582 — — 32,017,582 Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.21 ) $ (0.01 ) $ — $ (0.22 ) JRjr33, Inc. Condensed Consolidated Statements of Comprehensive Loss (Unaudited) Three Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Net loss $ (3,419 ) $ (619 ) $ — $ (4,038 ) Other comprehensive gain, net of tax: Unrealized gain (loss) on marketable securities Unrealized holding gain arising during the period — — — — Reclassification of other comprehensive loss included in net loss — — — — Foreign currency translation adjustment gain (loss) (463 ) 197 — (266 ) Other comprehensive gain (loss) (463 ) 197 — (266 ) Comprehensive loss (3,882 ) (422 ) — (4,304 ) Comprehensive loss (income) attributable to non-controlling interests 1,726 (710 ) — 1,016 Comprehensive loss attributable to JRjr33, Inc. $ (2,156 ) $ (1,132 ) $ — $ (3,288 ) Six Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Net loss $ (8,464 ) $ (367 ) $ — $ (8,831 ) Other comprehensive gain, net of tax: Unrealized gain (loss) on marketable securities Unrealized holding gain arising during the period 7 — — 7 Reclassification of other comprehensive loss included in net loss — (199 ) — (199 ) Foreign currency translation adjustment gain (loss) (153 ) 61 — (92 ) Other comprehensive loss (146 ) (138 ) — (284 ) Comprehensive loss (8,610 ) (505 ) — (9,115 ) Comprehensive loss (income) attributable to non-controlling interests 1,892 (206 ) — 1,686 Comprehensive loss attributable to JRjr33, Inc. $ (6,718 ) $ (711 ) $ — $ (7,429 ) JRjr33, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Operating activities: Net loss $ (8,464 ) $ (367 ) $ — $ (8,831 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions Depreciation and amortization 1,308 (255 ) — 1,053 Loss (gain) on sale of marketable securities 7 (199 ) — (192 ) Share-based compensation (1,197 ) — — (1,197 ) Provision for doubtful accounts 220 111 — 331 Gain on sales of assets (83 ) — — (83 ) Deferred income tax 73 — — 73 Goodwill impairment 192 — — 192 Non-cash compensation — 201 — 201 Changes in certain assets and liabilities: Accounts receivable (748 ) (286 ) — (1,034 ) Inventory 754 246 — 1,000 Other current assets 5 623 — 628 Accounts payable 522 (1,661 ) — (1,139 ) Related party payables 507 761 — 1,268 Accrued commissions 737 126 — 863 Accrued liabilities 3,704 (1,702 ) — 2,002 Deferred revenue (491 ) 23 — (468 ) Taxes payable 1,077 (1,695 ) — (618 ) Other liabilities (3,798 ) 3,348 — (450 ) Net cash used in operating activities (5,675 ) (726 ) — (6,401 ) Investing activities: Capital expenditures (407 ) 75 — (332 ) Proceeds from the sale of property, plant and equipment 187 (127 ) — 60 Purchase of marketable securities (18,876 ) — — (18,876 ) Sale of marketable securities 13,900 1 — 13,901 Proceeds from note receivable 1 1 — 2 Deposit of restricted cash collateral (3,027 ) 96 — (2,931 ) Acquisitions, net of cash purchased (3,137 ) 2 — (3,135 ) Net cash provided by (used in) investing activities (11,359 ) 48 — (11,311 ) Financing activities: Net borrowings on long-term debt and revolving credit facility 3,137 (86 ) — 3,051 Payments on debt (477 ) 6 — (471 ) Stock issuances 18,357 77 — 18,434 Net cash provided by financing activities 21,017 (3 ) — 21,014 Effect of exchange rate changes on cash and cash equivalents (153 ) (42 ) — (195 ) Increase in cash and cash equivalents 3,830 (723 ) — 3,107 Cash and cash equivalents at beginning of period 2,606 — — 2,606 Cash and cash equivalents at end of period $ 6,436 $ (723 ) $ — $ 5,713 Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ 595 $ 569 $ — $ 1,164 (1) The cash flow in the previously issued June 30, 2015 Form 10-Q contains calculation errors which are presented in the 'prior period cash flow errors' column. |
Acquisitions, Dispositions and
Acquisitions, Dispositions and Other Transactions | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Acquisitions, Dispositions and Other Transactions | Acquisitions, Dispositions and Other Transactions Kleeneze On March 24, 2015, we completed the acquisition of Kleeneze Limited (“Kleeneze”), a direct-to-consumer business based in the United Kingdom. Kleeneze offers a wide variety of cleaning, health, beauty, home, outdoor and other products to customers across the United Kingdom and Ireland. Pursuant to the terms of a Share Purchase Agreement with Findel Plc (“Findel”), the Company purchased 100% of the shares of Kleeneze from Findel for total consideration of $5.1 million . The consideration included $3.0 million of senior secured debt provided by HSBC Bank PLC, which has a term of two years and an interest rate per annum of 0.60% over the Bank of England Base Rate as published from time to time (an interest rate of approximately 1.1% at the time of the purchase). The remaining $2.1 million of consideration consisted of cash. Approximately $1.9 million in cash was acquired by the Company as part of the transaction at closing. The Kleeneze acquisition was accounted for under the acquisition method of accounting. The assets acquired and liabilities assumed by the Company were recognized at their fair value at the acquisition date. The Company incurred approximately, $113,000 of acquisition-related costs, all of which were expensed and included in general and administrative expenses on the consolidated statements of operations and comprehensive loss. The following summary represents the preliminary estimate of fair value of Kleeneze as of the acquisition date, March 24, 2015, and is subject to change following management’s final evaluation of the purchase price allocation and fair value assumptions. (in thousands) Consideration $ 5,100 Amounts recognized for assets acquired and liabilities assumed: Current assets 12,164 Other long-term assets 619 Current liabilities 9,030 Net assets acquired 3,753 Goodwill and intangible assets $ 1,347 Pro-forma Consolidated Statement of Operations The following unaudited pro-forma financial information presents the Company's consolidated financial results for the three and six months ended June 30, 2015 and 2014 as if the acquisition had occurred as of January 1, 2014 (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Operations Revenues $ 36,028 $ 40,092 $ 68,718 $ 83,238 Net loss (4,038 ) (4,049 ) (8,898 ) (7,366 ) Net loss attributable to JRjr33, Inc. (3,022 ) (3,003 ) (7,212 ) (5,680 ) Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.09 ) $ (0.12 ) $ (0.23 ) $ (0.23 ) Notes to Pro-forma Unaudited Condensed Consolidated Financial Statement These pro-forma results have been prepared for comparative purposes only and are not necessarily indicative of the results of operations that actually would have resulted had the acquisition been effective at the beginning of the respective periods and are not necessarily representative of future results. The pro-forma results include the following adjustments: • Losses were incurred as a result of the write down of intercompany receivables in the amount of $33.1 million that were forgiven prior to and in accordance with the transaction. As these losses were direct and one-time events related specifically to the acquisition, we have excluded these items from the pro-forma financials above; • The pro-forma results above exclude $113,000 in transaction costs. The revenues and earnings of Kleeneze since the acquisition date that have been included in our condensed consolidated financial statements for the three and six months ended June 30, 2015 were as follows: Three Months Ended June 30, 2015 Six Months Ended June 30, 2015 Revenue 13,118 13,485 Net loss, net of intercompany items (391 ) (362 ) Kleeneze net loss in the table above is presented net of intercompany expenses of $404,000 for the three and six months ended June 30, 2015. Uppercase Living On March 14, 2014, Uppercase Acquisition Inc. (“UAI”), a wholly-owned subsidiary of the Company, acquired substantially all the assets of Uppercase Living, LLC, a direct-to-consumer company that sells an extensive line of customizable vinyl expressions for display on walls. UAI assumed certain liabilities and agreed to issue 254,490 shares of our common stock, par value $ 0.0001 ("Common Stock") to the seller at a fair value of $97,000 on the acquisition date. The Company also agreed to deliver 323,897 shares of its common stock at a fair value of $ 123,000 to an escrow account for up to 24 months that will be issued to the seller upon remediation of certain close conditions. Since the Company did not deliver the shares of our Common Stock until April 2014, we recorded a payable at March 31, 2014 of $ 220,000 . The payable was relieved in April 2014 once the stock was issued to the seller. The Company also agreed to pay the seller three subsequent contingent payments equal to 10% of Earnings before Interest, Taxes, Depreciation and Amortization ("EBITDA") for each of the years ending 2014 to 2016. There have been no payments related to this contingency, to date, and no liability is recorded on our balance sheet related to a contingent payment for UAI due to the Company's belief that it is not probable that UAI will achieve positive EBITDA during the period of the contingent payment. Goodwill arising from the transaction totaled $469,000 . Dispositions On July 31, 2014, the Company and our subsidiary TLC and CFI NNN Raiders, LLC. ("CFI"), entered into a Sale Leaseback Agreement (the "Sale Leaseback Agreement") pursuant to which TLC agreed to sell to CFI certain real estate owned by TLC and used by TLC in its manufacturing, distribution and showroom activities. The real estate described in the Sale Leaseback Agreement was purchased by CFI, for an aggregate purchase price of $15.8 million . A gain on sale of approximately $2.5 million was recorded associated with the sale. Because the transaction was part of a Sale Leaseback agreement that is being accounted for as a capital lease, the gain has been deferred and will be recognized over the fifteen ( 15 ) year life of the Sale Leaseback Agreement. Public Offering On March 4, 2015 the Company closed an underwritten public offering of 6,667,000 shares of common stock and warrants to purchase up to an aggregate of 6,667,000 shares of common stock at a combined offering price of $3.00 . the Company granted the underwriters a 45 -day option to purchase up to an additional 1,000,050 shares of common stock and/or warrants to purchase up to an aggregate of 1,000,050 shares of common stock to cover additional over-allotments and the underwriters. On March 4, 2015, the underwriters exercised a portion of the over-allotment option with respect to 113,200 warrants. No options were exercised as it relates to shares of common stock. The over-allotment option has expired and no additional shares of common stock or warrants were exercised. In addition, warrants for an additional 166,675 shares with the same terms mentioned previously were issued to the Company’s underwriters per the terms of the Underwriting Agreement. The warrants have a per share exercise price of $3.75 , are exercisable immediately and will expire five years from the date of issuance. The exercise price of the warrant is subject to anti-dilutive adjustments (such as stock splits, stock dividends, recapitalizations or other similar events). There are no cash settlement alternatives associated with the warrant agreements that would require the Company to pay a holder of such warrant cash at exercise or at any other event. The fair value of the warrants are approximately $9.0 million as calculated using the Black Scholes model. In accordance with US GAAP, the Company has accounted for the warrants as equity instruments. The Warrants will be exercisable at any time a registration statement registering the issuance of the shares of Common Stock underlying the Warrants under the Securities Act is effective and available for the issuance of such shares, or an exemption from registration under the Securities Act is available for the issuance of such shares, by payment in full in immediately available funds for the number of shares of Common Stock purchased upon such exercise. If a registration statement registering the issuance of the shares of Common Stock underlying the warrants under the Securities Act is not effective or available and an exemption from registration under the Securities Act is not available for the issuance of such shares, the holder may, in its sole discretion, elect to exercise the Warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of shares of Common Stock determined according to the formula set forth in the Warrant. A holder of Warrants will not have the right to exercise any portion of the Warrant if such exercise would result in the holder (together with its affiliates) beneficially owning in excess of 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrants. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99% upon at least 61 days' prior notice from the holder to us. Possible Issuance of Additional Common Stock under Share Exchange Agreement Under a certain Share Exchange Agreement with Rochon Capital, which was amended during the fourth quarter of 2014 (the "Amended Share Exchange Agreement") Rochon Capital has rights to be issued the 25,240,676 shares of our common stock (the "Second Tranche Parent Stock") upon the public announcement that a person or group of affiliated or associated persons has become an Acquiring Person (as defined below), or upon the commencement or announcement of a tender or exchange offer which would result in any person or group becoming an Acquiring Person. In such event, the Second Tranche Parent Stock will be issued to Rochon Capital, or a Permitted Transferee to whom the right has been transferred, within ten ( 10 ) days of its written request, which request shall be in its sole discretion. A person or group of affiliated or associated persons becomes an "Acquiring Person," thus triggering the issuance of the Second Tranche Parent Stock to Rochon Capital, or a Permitted Transferee to whom the right has been transferred, upon acquiring, subsequent to the date of the Amended Share Exchange Agreement, beneficial ownership of 15% or more of the shares of our common stock then outstanding. The term "Acquiring Person" shall not include (1) any person who acquires 15% or more of our shares of common stock in a transaction approved by John P. Rochon, (2) any affiliates of John P. Rochon or (3) any family members of John P. Rochon. |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Marketable Securities Our marketable securities as of June 30, 2015 include fixed income investments classified as available for sale. At June 30, 2015 and December 31, 2014 , the fixed income securities totaled approximately $6.0 million and $1.0 million , respectively. The cost of marketable securities purchases during the six months ended June 30, 2015 , totaled $18.9 million . The proceeds from the sales of our marketable securities total $13.9 million and $6.2 million , respectively, for the six months ended June 30, 2015 and 2014 . Our realized losses from the sale of our marketable securities totaled $0 and $58,000 for the three months ended June 30, 2015 and 2014 , respectively. Our realized losses (gains) from the sale of our marketable securities totaled $(192,000) and $552,000 for the six months ended June 30, 2015 and 2014 , respectively. The change in unrealized holding losses on the investments included in consolidated statements of other comprehensive income were $0 and $184,000 for the three months ended June 30, 2015 and 2014 , respectively, and and $7,000 and $653,000 for the six months ended June 30, 2015 and 2014 . The unrealized loss has been in that position for less than one year. Accordingly, management does not believe that the investments have experienced any other than temporary losses. The Company elected fair value option to value the available for sale securities. These securities are Level 1 securities estimated based on quoted prices in active markets. In measuring the securities at an alternative adjusted cost basis, the adjusted cost equals the fair value reported as there were no unrealized gains or losses on the available for sale securities for the three months ended June 30, 2015 and the three months ended June 30, 2014 . As of June 30, 2015 our marketable securities investments had an effective maturity of 1.24 years and an average effective duration of 0.22 years. The majority of our marketable securities are invested in investment-grade corporate bonds. |
Inventory
Inventory | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory Inventories are stated at lower of cost or market. Cost is determined using the first-in, first-out (FIFO) method. Inventory consisted of the following (in thousands): June 30, December 31, Raw material and supplies $ 3,081 $ 3,052 Work in process 480 931 Finished goods 20,981 14,852 24,542 18,835 Inventory reserve (4,351 ) (4,076 ) Inventory, net $ 20,191 $ 14,759 |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consisted of the following (in thousands): June 30, December 31, Land and improvements $ 498 $ 699 Buildings and improvements 6,423 6,351 Equipment 4,027 2,978 Construction in progress — 10 10,948 10,038 Less accumulated depreciation and amortization (2,519 ) (1,847 ) Property, plant and equipment, net $ 8,429 $ 8,191 Depreciation and amortization expense related solely to property plant, and equipment depreciation was approximately $361,000 and $678,000 for the three and six months ended June 30, 2015 , respectively. The depreciation and amortization expense was approximately $394,000 and $963,000 for the three and six months ended June 30, 2014 . Depreciation included in the cost of sales totaled approximately $109,000 and $158,000 during the three and six months ended June 30, 2014 , respectively. In addition to owned property, the Company also has $14.8 million in leased assets, which is net of accumulated amortization of approximately $1.0 million as of June 30, 2015 . At December 31, 2014 leased assets totaled $15.4 million which is net of accumulated amortization of approximately $439,000 . Amortization related to leased assets totaled $263,000 and $527,000 for the three and six months ended June 30, 2015 , respectively. Included in the amortization of leased assets is $141,000 and $282,000 of amortization included in cost of sales during the three and six months ended June 30, 2015 , respectively. |
Long-term Debt and Other Financ
Long-term Debt and Other Financing Arrangements | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-term Debt and Other Financing Arrangements | Long-term Debt and Other Financing Arrangements The Company's long-term borrowing consisted of the following (in thousands, except for interest rates): Description Interest June 30, December 31, 2014 Senior secured debt – HSBC Bank PLC 1.10 % $ 3,143 $ — Promissory note—Payable to Former Shareholder of TLC 2.63 % 3,189 3,374 Promissory note—Lega Enterprises, LLC (formerly Agel Enterprises, LLC) 5.00 % 1,180 1,367 Other miscellaneous notes 4.00 % 417 516 Total debt 7,929 5,257 Less current maturities (914 ) (941 ) Long-term debt and other financing arrangements, net of current maturities $ 7,015 $ 4,316 The schedule of maturities of the Company’s long-term debt are as follows (in thousands): 2015 (remaining portion) $ 453 2016 931 2017 4,002 2018 715 2019 412 Thereafter 1,416 Total long-term debt including current maturities $ 7,929 Senior Secured debt – HSBC Bank PLC On March 24, 2015, the Company secured $3.0 million in senior secured debt from HSBC Bank PLC, with a term of two years and an annual interest rate of 0.60% over the Bank of England Base Rate as published from time to time. The loan is denominated in pound sterling (GBP) and secured by approximately $3.0 million in cash shown as "restricted cash" on our unaudited condensed consolidated balance sheets and there are no other covenants related to the debt. The cash collateral is held in a GBP denominated account. Promissory Note—Payable to Former Shareholder of TLC On March 14, 2013, we issued a $4.0 million promissory note in connection with the purchase of TLC. The Promissory Note bears interest at 2.63% per annum, has a ten -year maturity, and is payable in equal monthly installments of outstanding principal and interest. Promissory Note—Lega Enterprises, LLC On October 22, 2013, we issued a $1.7 million promissory note to Lega Enterprises, LLC (formerly Agel Enterprises, LLC) in connection with our acquisition of assets from Agel Enterprises, LLC. The promissory note bears interest at 5% per annum, and is payable in equal monthly installments of outstanding principal and interest and matures on October 22, 2018 . The note is secured by a lien on the assets of Agel. Promissory Note – Other Miscellaneous On December 4, 2014, we issued a $500,000 promissory note in connection with a settlement agreement. The promissory note bears interest at 4% per annum, and is payable in equal monthly installments of outstanding principal and interest. Capital Lease On July 31, 2014, TLC entered into the Sale Leaseback Agreement with CFI NNN Raiders. The lease was deemed to qualify as a capital lease and the transaction is being accounted for as a sale leaseback arrangement. The gain arising from the sale of the three buildings and related property was deferred and is being recognized using the full accrual method over the term of the lease. The lease has been classified as a capital lease since the condition was met whereby the term of the lease is greater than 75% of the estimated economic life of the property. TLC has recorded the sale and removed the properties sold and related liabilities from the balance sheet. Since the lease is a capital lease, a leased asset will be recorded and depreciated over 15 years using the straight-line method. The payment under the lease will be accounted for as interest and payments under capital lease using 15 year amortization. The interest expense associated with the lease payments was $552,000 and $1.1 million for the three and six months ended June 30, 2015 , respectively. The gain on sales of real estate amortized over the life of the lease was $42,000 and $84,000 for the three and six months ended June 30, 2015 , respectively. On June 30, 2015 the current portion of the lease totaled $35,000 and is included in other current liabilities on the condensed consolidated balance sheet. Minimum lease commitments for our capital leases for the years ended December 31, are as follows (in thousands): 2015 (remaining portion) $ 17 2016 73 2017 157 2018 255 2019 371 Thereafter 14,892 Total long-term debt including current maturities $ 15,765 Outstanding Warrants On March 4, 2015 the Company raised proceeds of $20 million though the sale of 6,667,000 shares of common stock and warrants to purchase up to an aggregate of 6,667,000 shares of its common stock at a combined offering price of $3.00 in an underwritten public offering (“Offering”). The warrants have a per share exercise price of $3.75 , are exercisable immediately and will expire five years from the date of issuance. The Company granted the underwriters a 45 -day option to purchase up to an additional 1,000,050 shares of common stock and/or warrants to purchase up to an aggregate of 1,000,050 shares of common stock to cover additional over-allotments, if any. On March 4, 2015, the underwriters exercised a portion of their over-allotment option with respect to 113,200 warrants. In addition, 166,675 warrants were issued to the underwriters. The over-allotment option has expired as of the date of this filing. The gross proceeds to the Company, including the underwriters' partial exercise of their over-allotment option, were approximately $20,000,000 before deducting underwriting discounts and commissions and other estimated offering expenses payable by the Company. Assuming the exercise of all 6,667,000 warrants at the exercise price of $3.75 each, and assuming the Company maintains the conditions necessary for a cash exercise, the total additional gross aggregate proceeds to the Company would be $25,001,250 . However, there can be no assurance that any warrants will be exercised or that the Company will maintain conditions necessary for a cash exercise. On May 6, 2014, the Company issued warrants to purchase up to 12,500 and 6,250 shares of common stock in connection with exclusivity agreements. The warrants were exercisable commencing 75 days after their date of issuance, in whole or in part, until one year from the date of issuance for cash and/or on a cashless exercise basis at an exercise price of $11.00 per share, representing the average closing price of our common stock for the ten days preceding the issuance. The fair value of the warrants on the date of issuance approximated $116,000 . The warrants expired in May 2015 and were not exercised. On July 2, 2014, the Company issued a warrant exercisable for 50,000 shares of common stock at an exercise price of $12.80 per share in consideration of a two -year consulting agreement with an individual with direct selling industry experience. The warrant is exercisable for a ten day period commencing 720 days after issuance. In addition, the warrant provides for piggyback registration rights upon request, in certain cases. The exercise price and number of shares issuable upon exercise of the warrants was subject to adjustment in the event of a stock dividend or our recapitalization, reorganization, merger or consolidation. On July 30, 2015 the Company executed an extension on the consulting agreement through July of 2017 in exchange for cancellation of the original warrant for 50,000 shares and the issuance of a new warrant exercisable for 50,000 shares of common stock at an exercise price of $1.16 per share. The new warrant is also exercisable for a ten day period commencing 720 days after issuance. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Jun. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Accumulated other comprehensive loss ("AOCI"), net of taxes, is comprised of the following (in thousands): Foreign Currency Translation Unrealized Gain (Loss) on Available-for- Sale Securities Total Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2014 $ 128 $ 193 $ 321 Other comprehensive income (loss) before reclassifications (92 ) 7 (85 ) Amount reclassified from AOCI — (199 ) (199 ) Transactions with non-controlling interests — — — Net other comprehensive income (loss) at June 30, 2015 $ 36 $ 1 $ 37 |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value We established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined as follows: Level 1—Unadjusted quoted prices in active markets for identical assets and liabilities; Level 2—Quoted prices for similar assets and liabilities in active markets (other than those included in Level 1) which are observable, either directly or indirectly; and Level 3—Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The carrying values of cash and cash equivalents, accounts receivable, accounts payable trade and related party, and line of credit payable are considered to be representative of their respective fair values due to the immediate or short-term nature or maturity of these financial instruments. Our available for sale securities (Level 1) was $6.0 million and (Level 2) $0 at June 30, 2015 . Available for sale securities totaled (Level 1) $129,000 and (Level 2) $862,000 at December 31, 2014 . The Company does not disclose the fair value of its debt instruments in accordance with the practicability exceptions laid out in ASC 820-10-15-3. Level 1 and 2 inputs are not available for the company’s notes, and Level 3 inputs are not reliable in relation to determining the fair market value of the company’s debt. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is occasionally involved in lawsuits and disputes arising in the normal course of business. In the opinion of management, based upon advice of counsel, the likelihood of an adverse outcome against the Company is remote. As such, management believes that the ultimate outcome of these lawsuits will not have a material impact on the Company's financial position or results of operations. Commitments Minimum lease commitments for non-cancelable operating leases for the years ended December 31, are as follows (in thousands): 2015 (remaining portion) $ 763 2016 611 2017 493 2018 361 2019 349 Thereafter 2,238 Total non-cancelable operating lease commitments $ 4,815 The leases for certain of the Company's facilities include rent escalation provisions, which are accounted for on a straight-line basis over the lease terms for purposes of determining rental expense. Worker’s Compensation Liability Certain of the Company’s employees were covered under a self-insured worker’s compensation plan which was replaced by a fully insured plan in December, 2014. The Company estimates its remaining self-insured worker’s compensation liability based on past claims experience, and has an accrued liability to cover estimated future costs. At June 30, 2015 and December 31, 2014 , the accrued liability was approximately $1.0 million . There can be no assurance that actual results will not materially differ from the Company’s estimates. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes As of June 30, 2015 , the Company did not have a history of earnings that would allow it to record any of its net deferred tax assets without a corresponding valuation allowance. Therefore, no net deferred tax asset is reflected as of June 30, 2015 . Additionally, due to some of its historical acquisitions which included intangibles with an indefinite life, the Company continues to accumulate a deferred tax liability which is recorded outside the net deferred tax asset and valuation allowance. A deferred tax liability is recorded within other current liabilities in the amount of $547,000 within our condensed consolidated balance sheets. The deferred tax expense for the three and six months ended June 30, 2015 was approximately $39,000 and $73,000 respectively. Deferred tax expense for the three and six months ended June 30, 2014 was approximately $45,000 and $89,000 , respectively. The Company records no current income tax expense related to its domestic activities due to historical or current net operating losses. Current tax expense for the three and six months ended June 30, 2015 was $156,000 and $313,000 , respectively. Current tax expense for the three and six months ended June 30, 2014 was approximately $168,000 and $403,000 , respectively. The current tax is based on the Company’s activities in certain foreign jurisdictions which are currently profitable and no loss carryover is available to offset the income. |
Share-Based Compensation Plans
Share-Based Compensation Plans | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation Plans | Share-Based Compensation Plans The Company has two share-based compensation plans, the 2013 Director Smart Bonus Unit Plan and 2013 Smart Bonus Unit Award Plan. These plans provide for the issuance of a cash bonus for stock appreciation. A Committee comprised of members of the Board of Directors approves all awards that are granted under our share-based compensation plan. We classify the awards as a liability as the value of the award will be settled in cash, notes, or stock. The SARs Program vests over a period of three years and have a contractual term of five years . The liability related to these awards is included in other long-term liabilities on our condensed consolidated balance sheets. Share-based compensation expense for the three and six months ended June 30, 2015 was $(30,000) and $(1.2) million , respectively, compared to $311,000 and $398,000 for the three and six months ended June 30, 2014 , respectively. The share-based compensation expense is included in selling, general and administrative expenses on the Company’s condensed consolidated income statements. As of June 30, 2015 , total unrecognized compensation cost related to unvested share-based compensation was $96,000 , which is expected to be recognized over a three -year period. On May 22, 2015, the Company’s Board of Directors approved the 2015 Stock Incentive Plan (the “2015 Stock Plan”), which was subsequently approved by the Company’s stockholders on June 23, 2015. The 2015 Stock Plan allows for the issuance of up to 1,500,000 shares of common stock to be granted through incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, and other stock-based awards to officers, other employees, directors and consultants of the Company and its subsidiaries. The exercise price of stock options under the 2015 Stock Plan is determined by the compensation committee of the Board of Directors, and may be equal to or greater than the fair market value of the Company’s common stock on the date the option is granted. The total number of shares of stock with respect to which stock options and stock appreciation rights may be granted to any one employee of the Company or a subsidiary during any one-year period under the 2015 plan shall not exceed 500,000 . Options become exercisable over various periods from the date of grant, and generally expire 10 years after the grant date. As of June 30, 2015, there were approximately 1.4 million options issued and outstanding under the 2015 Stock Plan. On June 23, 2015, 50,000 options were granted to each of two executive officers of the Company. These options were issued at an exercise price of $1.23 , and they vest in equal quarterly installments over the next three years beginning July 1, 2015. In accordance with ASC 718, these options are recognized as equity and expensed over the vesting period of three years . The fair value of the options are approximately $117,000 , and no share-based compensation expense was recorded for the three and six months ended June 30, 2015 . As of June 30, 2015 , total unrecognized compensation expense related to unvested share-based compensation was $117,000 , which is expected to be recognized over a three -year period. |
Loss Per Share Attributable to
Loss Per Share Attributable to the Company | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Loss Per Share Attributable to the Company | Loss Per Share Attributable to the Company In calculating loss per share, there were no adjustments to net loss for any periods presented. Outstanding warrants of approximately 6,996,875 and outstanding options of 100,000 were excluded from the fully diluted loss per share because inclusion of the warrants in the loss per share computation would be anti-dilutive. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company operates five operating segments, three of which are reportable segments, as a direct-to-consumer company that sells a wide range of products primarily through independent sales forces across many countries around the world. For the six months ended June 30, 2015 and June 30, 2014 , approximately $34.8 million or 62.3% and $21.6 million or 42.1% of our revenues were generated in international markets, respectively. For the three months ended June 30, 2015 and June 30, 2014 , approximately $25.7 million or 71.4% and $10.8 million or 43.9% of our revenues were generated in international markets, respectively. We have grouped our products into the following five operating segments: Gourmet Food Products, Nutritional and Wellness, Home Décor, Publishing and Printing, and Other. Substantially all of our long-lived assets are located in the U.S. Of these five operating segments, Gourmet Food Products, Home Décor, and Nutritional and Wellness qualify as reportable segments in line with the specifications established in ASC 280-10-50. We have identified three reportable segments as each segment engages in business activities, incurring expenses and producing revenues, the operating results of these segments are regularly reviewed by chief decision makers and there is discrete financial information available for each unit. Also, the reported revenue of each reportable segment, both external and intercompany, is 10% or more of the combined revenue of all of the operating segments. The Company's three reportable segments are: 1) Gourmet Food Products, 2) Home Décor and 3) Nutritionals and Wellness. In prior periods we had identified and presented one reportable segment, with revenue broken down into five categories within our segment discussion. However, with the addition of Kleeneze, the continued growth of Your Inspiration at Home and anticipated future growth, both organically and through acquisitions, we now view the Company as having five operating segments, three of which are reportable segments as discussed above. As revenues have concentrated within these three reportable segments, our chief operating decision makers ("CODM") now view these segments as appropriate for decision making purposes because they each represent a significant part of our business. The following is a brief description of our three reportable segments. Gourmet Food Products - Segment consists of operations related to the production and sale of hand-crafted spices, oils and other food products from around the world. These operations have a presence in many of our markets both in the U.S. and internationally such as in Australia, New Zealand, Canada, and the United Kingdom. The Company's subsidiaries involved in this line of business are Your Inspiration at Home and My Secret Kitchen. Home Décor - Segment consists of operations related to the production and sale of premium hand-crafted baskets and the selling of products for the home, including pottery, cleaning, health, beauty, home, outdoor and customizable vinyl expressions for display. These operations are primarily located within the United States and the United Kingdom. The primary subsidiaries involved in this line of business are Kleeneze, TLC and Uppercase Living. Nutritionals and Wellness - Segment consists of operations related to the selling of nutritional supplements and skin care products. These operations have a presence in many foreign markets and over 40 countries such as Italy, Russia, Spain, and Israel. The subsidiary primarily involved in this type of products is Agel. We note that these three segments exceed 75% of The Company's consolidated revenue. Therefore, no further aggregation or disclosures are required for the remaining operating segments. Although they do not qualify as reportable segments, we have included our Publishing and Printing and Other operating segments within the tables below to provide easier reconciliation to our results found on the condensed consolidated statements of operations and further transparency. The Publishing and Printing Segment consists of HCG and Paperly. The Other Segment consists of Tomboy Tools ("TBT"). In the tables below we present revenues and gross profit by operating segment. Our CODM evaluates performance on a segment basis from the standpoint of gross profit because many of our operating expenses are part of our shared services group at the corporate level, providing services to all of our operating segments, which is consistent with our post-acquisition integration strategies. In addition, there are numerous intercompany allocations and expenses that are most appropriately viewed on a consolidated basis for the Company as a whole. We do not have intersegment revenues. Segment information, which includes all operating segments, for the three and six months ended June 30, 2015 and June 30, 2014 are shown in the tables below (in thousands): Three months ended Gourmet Food Products Home Décor Nutritionals and Wellness Publishing & Printing Other Consolidated 2015 Revenue $ 5,190 $ 22,459 $ 7,981 $ 271 $ 127 $ 36,028 Gross profit 2,222 9,679 6,397 179 67 18,544 Operating expenses (21,822 ) Loss on marketable securities — Interest expense (565 ) Loss from operations before income tax provision $ (3,843 ) 2014 Revenue $ 1,644 $ 12,437 $ 9,954 $ 319 $ 232 $ 24,586 Gross profit 889 3,730 8,530 206 148 13,503 Operating expenses (17,610 ) Loss on marketable securities (58 ) Interest expense (213 ) Loss from operations before income tax provision $ (4,378 ) Six months ended Gourmet Food Products Home Décor Nutritionals and Wellness Publishing & Printing Other Consolidated 2015 Revenue $ 7,735 $ 32,630 $ 14,757 $ 504 $ 280 $ 55,906 Gross profit 2,757 14,983 11,702 317 181 29,940 Operating expenses (37,413 ) Gain on marketable securities 192 Interest expense (1,164 ) Loss from operations before income tax provision $ (8,445 ) 2014 Revenue $ 2,608 $ 27,458 $ 20,156 $ 613 $ 422 $ 51,257 Gross profit 1,367 8,588 16,595 393 239 27,182 Operating expenses (34,026 ) Loss on marketable securities (552 ) Interest expense (479 ) Loss from operations before income tax provision $ (7,875 ) In accordance with ASC 280-10-50, we have disclosed below the total assets for which there has been a material change from the amount disclosed in the last annual report. The total assets related to the reportable segment, Home Décor, increased over $28.7 million from December 31, 2014 to June 30, 2015 primarily due to the acquisition of Kleeneze in March 2015, which at June 30, 2015 , had approximately $20.8 million in total assets. The below table shows the total assets for each reportable segment, which have been reconciled to the consolidated total assets (in thousands): June 30, 2015 December 31, 2014 Gourmet Food Products $ 1,000 $ 1,142 Home Décor 56,902 28,184 Nutritionals and Wellness 10,737 11,693 All other segments 10,663 16,288 Consolidated total assets $ 79,302 $ 57,307 |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions During the fourth quarter of 2013, we renewed a Reimbursement of Services Agreement for a minimum of one year with Richmont Holdings - a closely held company by the Company's Chairman and CEO. The Company has begun to establish an infrastructure of personnel and resources necessary to identify, analyze, negotiate and conduct due diligence on direct-to-consumer acquisition candidates. However, we continue to need advice and assistance in areas related to identification, analysis, financing, due diligence, negotiations and other strategic planning, accounting, tax and legal matters associated with such potential acquisitions. Richmont Holdings and its affiliates have experience in the above areas and we wish to draw upon such experience. In addition, Richmont Holdings had already developed a strategy of acquisitions in the direct-to-consumer industry and has assigned and transferred to us the opportunities it has previously analyzed and pursued. The Company has agreed to pay Richmont Holdings a reimbursement fee (the “Reimbursement Fee”) each month and we agreed to reimburse or pay the due diligence, financial analysis, legal, travel and other costs Richmont Holdings incurred in identifying, analyzing, performing due diligence, structuring and negotiating potential transactions. During the three months ended June 30, 2015 and 2014 , the Company recorded Reimbursement Fees of approximately $552,000 and $480,000 , respectively, in selling, general and administrative expense located on the condensed consolidated statements of operations. During the six months ended June 30, 2015 and 2014 , the Company recorded Reimbursement Fees totaling approximately $1.1 million and $960,000 , respectively. On February 26, 2015 we received a loan from Richmont Capital Partners V (“RCP V”) - a private equity investment arm of Richmont Holdings - in the amount of $425,000 . The loan does not currently bear interest and has no set maturity date. As of June 30, 2015 and December 31, 2014 , there was a related party payable balance of approximately $396,000 and $120,000 due to Richmont Holdings included in related party payables on the Company's balance sheet, respectively. On September 25, 2012, upon acquisition of HCG, the Company inherited a related party shareholder payable of $25,000 related to a loan made by HCG’s former shareholder, Rochon Capital, to HCG for working capital. This amount is included in related-party payables within current liabilities. The loan does not currently have a set maturity date. On June 27, 2014, Tamala L. Longaberger lent TLC $42,000 and in connection therewith TLC issued a promissory note in the principal amount of $42,000 to her. The note bears interest at the rate of 10% per annum and matures on June 27, 2015 . This amount is included in related-party payables within current liabilities. On July 1, 2014, Tamala L. Longaberger lent AEI $158,000 and in connection therewith AEI issued a promissory note in the principal amount of $158,000 to her. The note bears interest at the rate of 10% per annum and matures on July 1, 2015 and is guaranteed by us. This amount is included in related-party payables within current liabilities. On July 11, 2014, Tamala L. Longaberger lent AEI $800,000 and in connection therewith AEI issued a promissory note in the principal amount of $800,000 to her. The note bears interest at the rate of 10% per annum and matures July 11, 2015 and is guaranteed by us. This amount is included in related-party payables within current liabilities. The Company determined not to service the loans related to Tamala L. Longaberger. As a result, in connection with these notes, Ms. Longaberger on August 12, 2015 filed an action in Franklin County Common Pleas Court of Columbus, Ohio (“State Court Action”) seeking re-payment of the notes. However, it is the Company’s position that her claims are inextricably tied to the broader issues related to her terminated employment and the claims asserted against her by the Company and The Longaberger Company, including breach of fiduciary duty, fraud, negligence, conversion, misappropriation of company funds, civil theft, breach of contract, and misappropriation of trade secrets, in an arbitration action in Columbus Ohio. Therefore, on October 12, 2015 , the Company filed a motion to compel arbitration and dismiss claims in the State Court Action. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Goodwill The Company's management performs its goodwill and other indefinite-lived intangible impairment tests annually or when changes in circumstances indicate an impairment event may have occurred by estimating the fair value of each reporting segment compared to its carrying value. The Company is aggregated into five operating segments presented herein (Note 14) based on similar economic characteristics, nature of products and services, nature of production processes, type of customers and distribution methods. Our five operating segments consist of: 1) Gourmet Food Products, 2) Home Décor, 3) Nutritionals and Wellness, 4) Publishing and Printing and 5) Other. We use a discounted cash flow model and a market approach to calculate the fair value of our operating segments. The models include a number of significant assumptions and estimates regarding future cash flows and these estimates could be materially impacted by adverse changes in market conditions. Goodwill is measured for impairment by comparing the fair value of the reporting unit to its carrying value, including goodwill. If the fair value of the reporting unit is less than the carrying value, a second step is performed to determine the implied fair value of goodwill. If the implied fair value of goodwill is lower than its carrying value, an impairment charge equal to the difference is recorded. A significant decline in TBT revenue, the only subsidiary included in the 'Other' operating segment, indicated that the carrying amount of this reporting unit may be impaired. The Company tested goodwill for impairment and determined that TBT's goodwill was impaired at June 30, 2015. Impairment charges totaled $192,000 for the three and six month ending June 30, 2015 , respectfully. Goodwill for TBT at June 30, 2015 was approximately $190,000 , net of accumulated impairment. Accumulated impairment of goodwill since the acquisition in October 2013 is approximately $375,000 . Indefinite-lived assets are measured for impairment by comparing the fair value of the indefinite-lived intangible asset to its carrying value. If the fair value of the indefinite-lived intangible asset is lower than its carrying value, an impairment charge equal to the difference is recorded. We determined that no impairment of indefinite-lived intangible assets should be made in the period. The following table provides the components of and changes in the carrying amount of Goodwill (in thousands): Acquired Goodwill Accumulated Impairment Other Net Carrying Amount Balance December 31, 2014 $ 7,073 $ (2,978 ) $ — $ 4,095 Additions (a) 1,342 — 3 1,345 Impairment (b) — (192 ) — (192 ) Other (c) — — (6 ) (6 ) Balance June 30, 2015 $ 8,415 $ (3,170 ) $ (3 ) $ 5,242 (a) Related to our acquisition of Kleeneze (see note 3. Acquisitions, Dispositions and Other Transactions) (b) Related to the impairment of Tomboy Tools (c) Primarily reflects the impact of foreign exchange Identifiable Intangible Assets The following table provides the components of Identifiable intangible assets (in thousands, except amortization period): Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of June 30, 2015 Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ 3,400 $ — $ 3,400 — Finite-lived intangible assets: Trade name and trademarks 2,179 (2,175 ) 4 0 Other intellectual property 363 (54 ) 309 9 $ 5,942 $ (2,229 ) $ 3,713 9 Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ — $ — $ — — Finite-lived intangible assets: Trade name and trademarks 5,579 (2,348 ) 3,231 19 Other intellectual property 363 (36 ) 327 9 $ 5,942 $ (2,384 ) $ 3,558 17 Amortization Amortization expense related to acquired intangible assets that contribute to our trade names, trademarks and other intellectual property is included in amortization of intangible assets. Amortization expense related to intangible assets is included in depreciation and amortization in the operating expenses. Total amortization expense for intangible assets were $9,000 for the second quarter of 2015 and $51,000 for the second quarter of 2014 , and $(152,000) for the first six months of 2015 and $103,000 for the first six months of 2014 . The $(152,000) amortization expenses recorded for the six months ended June 30, 2015, includes a $170,000 amortization credit resulting from amortizing an indefinite-lived asset. The Company corrected this error as a restatement adjustment in the March 31, 2015 Form 10-Q/A. The pro-forma amortization expense for six months ended June 30, 2015 was $18,000 , when adjusting for the amortization credit. As of June 30, 2015 , the estimated future amortization expense associated with our intangible assets for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): Amortization of Intangible Assets 2015 (remaining six months) $ 18 2016 36 2017 36 2018 36 2019 36 Thereafter 151 Total $ 313 Impairment Indefinite-lived assets are measured for impairment by comparing the fair value of the indefinite-lived intangible asset to its carrying value. If the fair value of the indefinite-lived intangible asset is lower than its carrying value, an impairment charge equal to the difference is recorded. We determined that no impairment of indefinite-lived intangible assets should be made in the quarter ending June 30, 2015 . |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On July 30, 2015, the Company entered into separate consulting agreements with two individuals pursuant to which each will provide certain business and financial advisory services to the Company. In connection with the consulting agreements, each consultant will be granted options exercisable for 500,000 shares of the Company’s common stock, par value $ 0.0001 per share under the Company’s 2015 Stock Incentive Plan (for an aggregate of 1,000,000 shares). The options have an exercise price $ 1.27 and are fully vested on the date of the grant and expire on July 30, 2020. The options and the shares of Common Stock issuable thereunder were issued in a transaction exempt from registration under the Securities Act of 1933, as amended, pursuant to Section 4(a)(2) thereof. On July 30, 2015, we executed an extension on the original consulting agreement we executed on July 2, 2014 with an individual who has extensive experience in the direct-to-consumer industry. The agreement now ends in July of 2017. The extension was in exchange for cancellation of the original warrant for 50,000 shares, issued on July 2, 2014, and the issuance of a new warrant exercisable for 50,000 shares of our common stock at an exercise price of $ 1.16 per share. The warrant is exercisable for a ten day period commencing 720 days after issuance. In addition, the warrant provides for piggyback registration rights upon request, in certain cases. The exercise price and number of shares issuable upon exercise of the warrants is subject to adjustment in the event of a stock dividend or our recapitalization, reorganization, merger or consolidation. |
General (Policies)
General (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Reclassifications | Reclassifications Prior period financial statement amounts have been reclassified to conform to current period presentation |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. These estimates are based on information available as of the date of the consolidated financial statements. Actual results could differ significantly from those estimates. |
Accounts Receivable | Accounts Receivable The carrying value of our accounts receivable, net of allowance for doubtful accounts, represents their estimated net realizable value. We estimate the allowance for doubtful accounts based on type of customer, age of outstanding receivable, historical collection trends, and existing economic conditions. If events or changes in circumstances indicate that a specific receivable balance may be unrealizable, further consideration is given to the collectability of those balances, and the allowance is adjusted accordingly. Receivable balances deemed uncollectible are written off against the allowance. |
Income Taxes | Income Taxes The Company and its U.S. subsidiaries (excluding The Longaberger Company) file a consolidated Federal income tax return. Deferred income taxes are provided for temporary differences between financial statement and tax bases of asset and liabilities. Benefits from tax credits are reflected currently in earnings. We record income tax positions based on a more likely than not threshold that the tax positions will be sustained on examination by the taxing authorities having full knowledge of all relevant information. |
Translation of Foreign Currencies | Translation of Foreign Currencies The functional currency of our foreign subsidiaries is the local currency of their country of domicile. Assets and liabilities of the foreign subsidiaries are translated into U.S. dollar amounts at period-end exchange rates. Revenue and expense accounts are translated at the weighted-average rates for the quarterly accounting period to which they relate. Equity accounts are translated at historical rates. Foreign currency translation adjustments are accumulated as a component of other comprehensive income. Management has determined the functional currency of each primary operating subsidiary by evaluating indicators such as cash flows, sales prices, sales markets, expenses, financing, and intra-entity transactions and arrangements. |
Revenue Recognition and Deferred Revenue | Revenue Recognition and Deferred Revenue In the ordinary course of business we receive payments, primarily via credit card, for the sale of products at the time customers place orders. Sales and related fees such as shipping and handling, net of applicable sales discounts, are recorded as revenue when the product is shipped and when title and the risk of ownership passes to the customer. The Company presents revenues net of any taxes collected from customers which are remitted to governmental authorities. Payments received for undelivered products are recorded as deferred revenue and are included in current liabilities on the Company’s consolidated balance sheets. Certain incentives offered on the sale of our products, including sales discounts, described in the paragraph below are classified as program costs and discounts. A provision for product returns and allowances is recorded and is founded on historical experience and is classified as a reduction of revenues. At June 30, 2015 and 2014 , our provision for sales returns totaled $440,000 and $227,000 , respectively. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In January 2015 the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update 2015-01 (ASU 2015-01), Income Statement - Extraordinary Items and Unusual Items . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. ASU 2015-01 eliminates the concept of extraordinary items from GAAP. We are in the process of assessing the effects of the application of the new guidance on our financial statements. In February 2015 the FASB issued Accounting Standards Update 2015-02 (ASU 2015-02), Amendments to the Consolidation Analysis . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. The new consolidation standard changes the criteria a reporting enterprise uses to evaluate if certain legal entities, such as limited partnerships and similar entities, should be consolidated. We are in the process of assessing the effects of the application of the new guidance on our financial statements. In April 2015 the FASB issued Accounting Standards Update 2015-03 (ASU 2015-03), Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs . The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. Early adoption is permitted. The new standard requires debt issuance costs to be classified as reductions to the face value of the related debt. We do not expect ASU 2015-03 to materially affect our financial position until we issue new debt. In July 2015, the FASB issued Accounting Standards Update 2015-11 (ASU 2015-11) to simplify the subsequent measurement of inventory. The new standard requires that inventory be measured at the lower of cost or net realizable value. The ASU is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2016. Early application is permitted as of the beginning of an interim or annual reporting period. |
Goodwill and Other Intangible Assets | Goodwill The Company's management performs its goodwill and other indefinite-lived intangible impairment tests annually or when changes in circumstances indicate an impairment event may have occurred by estimating the fair value of each reporting segment compared to its carrying value. The Company is aggregated into five operating segments presented herein (Note 14) based on similar economic characteristics, nature of products and services, nature of production processes, type of customers and distribution methods. Our five operating segments consist of: 1) Gourmet Food Products, 2) Home Décor, 3) Nutritionals and Wellness, 4) Publishing and Printing and 5) Other. We use a discounted cash flow model and a market approach to calculate the fair value of our operating segments. The models include a number of significant assumptions and estimates regarding future cash flows and these estimates could be materially impacted by adverse changes in market conditions. Goodwill is measured for impairment by comparing the fair value of the reporting unit to its carrying value, including goodwill. If the fair value of the reporting unit is less than the carrying value, a second step is performed to determine the implied fair value of goodwill. If the implied fair value of goodwill is lower than its carrying value, an impairment charge equal to the difference is recorded. |
General (Tables)
General (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Functional and Reporting Currencies of Primary Operating Subsidiaries | We have listed below our primary operating subsidiaries for each of our companies and their functional and reporting currencies. Subsidiary Functional Currency Reporting Currency The Longaberger Company ( "Longaberger" or “TLC”) USD USD Uppercase Acquisition, Inc. ("UAI") USD USD CVSL TBT LLC ("Tomboy Tools" or "TBT") USD USD My Secret Kitchen, Ltd. ("MSK") GBP USD Your Inspiration At Home Pty Ltd. ("YIAH") AUD USD Paperly, Inc. USD USD Happenings Communications Group, Inc. ("HCG") USD USD Agel Enterprises Inc. ("AEI") USD USD Kleeneze Ltd. GBP USD |
Restatement of Condensed Cons26
Restatement of Condensed Consolidated Financial Statements (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments | JRjr33, Inc. Condensed Consolidated Balance Sheets (Unaudited) June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Assets Current assets: Cash and cash equivalents $ 6,436 $ (723 ) $ — $ 5,713 Marketable securities 5,967 — — 5,967 Accounts receivable, net 3,966 300 50 4,316 Inventory, net 20,289 (97 ) (1 ) 20,191 Other current assets 3,373 (117 ) (152 ) 3,104 Total current assets 40,031 (637 ) (103 ) 39,291 Restricted cash 3,027 (1 ) — 3,026 Sale leaseback security deposit 4,414 — — 4,414 Property, plant and equipment, net 8,429 — — 8,429 Leased property, net 14,834 — — 14,834 Goodwill 5,246 (4 ) — 5,242 Intangibles, net 3,458 255 — 3,713 Other assets 353 — — 353 Total assets $ 79,792 $ (387 ) $ (103 ) $ 79,302 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 12,515 $ 3 $ 196 $ 12,714 Related party payables 635 761 25 1,421 Line of credit 99 — (99 ) — Accrued commissions 4,056 — 123 4,179 Accrued liabilities 8,316 (79 ) (143 ) 8,094 Deferred revenue 2,490 (727 ) — 1,763 Current portion of long-term debt 949 (92 ) 57 914 Taxes payable 3,842 219 (154 ) 3,907 Other current liabilities 3,027 33 (108 ) 2,952 Total current liabilities 35,929 118 (103 ) 35,944 Long-term debt 7,015 — — 7,015 Lease liability 15,765 — — 15,765 Other long-term liabilities 2,353 — — 2,353 Total liabilities 61,062 118 (103 ) 61,077 Commitments & contingencies Stockholders' equity: Preferred stock, par value $0.001 per share, 500,000 authorized — — — — Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively 4 — — 4 Additional paid-in capital 55,468 — — 55,468 Accumulated other comprehensive (loss) income 174 (137 ) — 37 Accumulated deficit (38,730 ) (574 ) — (39,304 ) Total stockholders' equity attributable to JRJR33, Inc. 16,916 (711 ) — 16,205 Stockholders' equity attributable to non-controlling interest 1,814 206 — 2,020 Total stockholders' equity 18,730 (505 ) — 18,225 Total liabilities and stockholders' equity $ 79,792 $ (387 ) $ (103 ) $ 79,302 JRjr33, Inc. Condensed Consolidated Statements of Operations (Unaudited) Three Months Ended June 30, 2015 (in thousands, except share and per share data) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Revenue $ 35,742 $ 77 $ 209 $ 36,028 Program costs and discounts (2,998 ) (602 ) (2,774 ) (6,374 ) Net revenue 32,744 (525 ) (2,565 ) 29,654 Costs of sales 10,955 466 (311 ) 11,110 Gross profit 21,789 (991 ) (2,254 ) 18,544 Commissions and incentives 12,612 (1,601 ) (2,564 ) 8,447 Gain on sale of assets (40 ) — — (40 ) Selling, general and administrative 12,026 425 310 12,761 Depreciation and amortization 678 (186 ) — 492 Share based compensation expense (1,197 ) 1,167 — (30 ) Impairment of goodwill 192 — — 192 Operating loss (2,482 ) (796 ) — (3,278 ) Interest expense, net 745 (180 ) — 565 Loss from operations before income tax provision (3,227 ) (616 ) — (3,843 ) Income tax provision 192 3 — 195 Net loss (3,419 ) (619 ) — (4,038 ) Net loss attributable to non-controlling interest 1,726 (710 ) — 1,016 Net loss attributable to JRjr33, Inc. $ (1,693 ) $ (1,329 ) $ — $ (3,022 ) Basic and diluted loss per share: Weighted average common shares outstanding 34,367,095 — — 34,367,095 Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.05 ) $ (0.04 ) $ — $ (0.09 ) Six Months Ended June 30, 2015 (in thousands, except share and per share data) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Revenue $ 54,961 $ 588 $ 357 $ 55,906 Program costs and discounts (5,160 ) (1,466 ) (3,000 ) (9,626 ) Net revenue 49,801 (878 ) (2,643 ) 46,280 Costs of sales 16,365 398 (423 ) 16,340 Gross profit 33,436 (1,276 ) (2,220 ) 29,940 Commissions and incentives 18,480 (1,569 ) (2,643 ) 14,268 Gain on sale of assets (83 ) — — (83 ) Selling, general and administrative 21,466 1,573 423 23,462 Depreciation and amortization 1,308 (537 ) — 771 Share based compensation expense (1,197 ) — — (1,197 ) Impairment of goodwill 192 — — 192 Operating loss (6,730 ) (743 ) — (7,473 ) Loss (gain) on sale of marketable securities 7 (199 ) — (192 ) Interest expense, net 1,341 (177 ) — 1,164 Loss from operations before income tax provision (8,078 ) (367 ) — (8,445 ) Income tax provision 386 — — 386 Net loss (8,464 ) (367 ) — (8,831 ) Net loss attributable to non-controlling interest 1,892 (206 ) — 1,686 Net loss attributable to JRjr33, Inc. $ (6,572 ) $ (573 ) $ — $ (7,145 ) Basic and diluted loss per share: Weighted average common shares outstanding 32,017,582 — — 32,017,582 Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.21 ) $ (0.01 ) $ — $ (0.22 ) JRjr33, Inc. Condensed Consolidated Statements of Comprehensive Loss (Unaudited) Three Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Net loss $ (3,419 ) $ (619 ) $ — $ (4,038 ) Other comprehensive gain, net of tax: Unrealized gain (loss) on marketable securities Unrealized holding gain arising during the period — — — — Reclassification of other comprehensive loss included in net loss — — — — Foreign currency translation adjustment gain (loss) (463 ) 197 — (266 ) Other comprehensive gain (loss) (463 ) 197 — (266 ) Comprehensive loss (3,882 ) (422 ) — (4,304 ) Comprehensive loss (income) attributable to non-controlling interests 1,726 (710 ) — 1,016 Comprehensive loss attributable to JRjr33, Inc. $ (2,156 ) $ (1,132 ) $ — $ (3,288 ) Six Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Net loss $ (8,464 ) $ (367 ) $ — $ (8,831 ) Other comprehensive gain, net of tax: Unrealized gain (loss) on marketable securities Unrealized holding gain arising during the period 7 — — 7 Reclassification of other comprehensive loss included in net loss — (199 ) — (199 ) Foreign currency translation adjustment gain (loss) (153 ) 61 — (92 ) Other comprehensive loss (146 ) (138 ) — (284 ) Comprehensive loss (8,610 ) (505 ) — (9,115 ) Comprehensive loss (income) attributable to non-controlling interests 1,892 (206 ) — 1,686 Comprehensive loss attributable to JRjr33, Inc. $ (6,718 ) $ (711 ) $ — $ (7,429 ) JRjr33, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended June 30, 2015 (in thousands) As Previously Reported Restatement Adjustments Reclassification Adjustments As Restated Operating activities: Net loss $ (8,464 ) $ (367 ) $ — $ (8,831 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions Depreciation and amortization 1,308 (255 ) — 1,053 Loss (gain) on sale of marketable securities 7 (199 ) — (192 ) Share-based compensation (1,197 ) — — (1,197 ) Provision for doubtful accounts 220 111 — 331 Gain on sales of assets (83 ) — — (83 ) Deferred income tax 73 — — 73 Goodwill impairment 192 — — 192 Non-cash compensation — 201 — 201 Changes in certain assets and liabilities: Accounts receivable (748 ) (286 ) — (1,034 ) Inventory 754 246 — 1,000 Other current assets 5 623 — 628 Accounts payable 522 (1,661 ) — (1,139 ) Related party payables 507 761 — 1,268 Accrued commissions 737 126 — 863 Accrued liabilities 3,704 (1,702 ) — 2,002 Deferred revenue (491 ) 23 — (468 ) Taxes payable 1,077 (1,695 ) — (618 ) Other liabilities (3,798 ) 3,348 — (450 ) Net cash used in operating activities (5,675 ) (726 ) — (6,401 ) Investing activities: Capital expenditures (407 ) 75 — (332 ) Proceeds from the sale of property, plant and equipment 187 (127 ) — 60 Purchase of marketable securities (18,876 ) — — (18,876 ) Sale of marketable securities 13,900 1 — 13,901 Proceeds from note receivable 1 1 — 2 Deposit of restricted cash collateral (3,027 ) 96 — (2,931 ) Acquisitions, net of cash purchased (3,137 ) 2 — (3,135 ) Net cash provided by (used in) investing activities (11,359 ) 48 — (11,311 ) Financing activities: Net borrowings on long-term debt and revolving credit facility 3,137 (86 ) — 3,051 Payments on debt (477 ) 6 — (471 ) Stock issuances 18,357 77 — 18,434 Net cash provided by financing activities 21,017 (3 ) — 21,014 Effect of exchange rate changes on cash and cash equivalents (153 ) (42 ) — (195 ) Increase in cash and cash equivalents 3,830 (723 ) — 3,107 Cash and cash equivalents at beginning of period 2,606 — — 2,606 Cash and cash equivalents at end of period $ 6,436 $ (723 ) $ — $ 5,713 Supplemental disclosure of cash flow information: Cash paid during the period for: Interest $ 595 $ 569 $ — $ 1,164 (1) The cash flow in the previously issued June 30, 2015 Form 10-Q contains calculation errors which are presented in the 'prior period cash flow errors' column. |
Acquisitions, Dispositions an27
Acquisitions, Dispositions and Other Transactions (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of Estimate of Fair Value of Kleeneze Acquisition | The following summary represents the preliminary estimate of fair value of Kleeneze as of the acquisition date, March 24, 2015, and is subject to change following management’s final evaluation of the purchase price allocation and fair value assumptions. (in thousands) Consideration $ 5,100 Amounts recognized for assets acquired and liabilities assumed: Current assets 12,164 Other long-term assets 619 Current liabilities 9,030 Net assets acquired 3,753 Goodwill and intangible assets $ 1,347 |
Schedule of Unaudited Pro-forma Financial Information | The following unaudited pro-forma financial information presents the Company's consolidated financial results for the three and six months ended June 30, 2015 and 2014 as if the acquisition had occurred as of January 1, 2014 (in thousands, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Operations Revenues $ 36,028 $ 40,092 $ 68,718 $ 83,238 Net loss (4,038 ) (4,049 ) (8,898 ) (7,366 ) Net loss attributable to JRjr33, Inc. (3,022 ) (3,003 ) (7,212 ) (5,680 ) Loss per common share attributable to JRjr33, Inc., basic and diluted $ (0.09 ) $ (0.12 ) $ (0.23 ) $ (0.23 ) The revenues and earnings of Kleeneze since the acquisition date that have been included in our condensed consolidated financial statements for the three and six months ended June 30, 2015 were as follows: Three Months Ended June 30, 2015 Six Months Ended June 30, 2015 Revenue 13,118 13,485 Net loss, net of intercompany items (391 ) (362 ) |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Inventories are stated at lower of cost or market. Cost is determined using the first-in, first-out (FIFO) method. Inventory consisted of the following (in thousands): June 30, December 31, Raw material and supplies $ 3,081 $ 3,052 Work in process 480 931 Finished goods 20,981 14,852 24,542 18,835 Inventory reserve (4,351 ) (4,076 ) Inventory, net $ 20,191 $ 14,759 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, plant and equipment consisted of the following (in thousands): June 30, December 31, Land and improvements $ 498 $ 699 Buildings and improvements 6,423 6,351 Equipment 4,027 2,978 Construction in progress — 10 10,948 10,038 Less accumulated depreciation and amortization (2,519 ) (1,847 ) Property, plant and equipment, net $ 8,429 $ 8,191 |
Long-term Debt and Other Fina30
Long-term Debt and Other Financing Arrangements (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The Company's long-term borrowing consisted of the following (in thousands, except for interest rates): Description Interest June 30, December 31, 2014 Senior secured debt – HSBC Bank PLC 1.10 % $ 3,143 $ — Promissory note—Payable to Former Shareholder of TLC 2.63 % 3,189 3,374 Promissory note—Lega Enterprises, LLC (formerly Agel Enterprises, LLC) 5.00 % 1,180 1,367 Other miscellaneous notes 4.00 % 417 516 Total debt 7,929 5,257 Less current maturities (914 ) (941 ) Long-term debt and other financing arrangements, net of current maturities $ 7,015 $ 4,316 |
Schedule of Maturities of Long-term Debt | The schedule of maturities of the Company’s long-term debt are as follows (in thousands): 2015 (remaining portion) $ 453 2016 931 2017 4,002 2018 715 2019 412 Thereafter 1,416 Total long-term debt including current maturities $ 7,929 |
Schedule of Minimum Lease Commitments for Capital Leases | Minimum lease commitments for our capital leases for the years ended December 31, are as follows (in thousands): 2015 (remaining portion) $ 17 2016 73 2017 157 2018 255 2019 371 Thereafter 14,892 Total long-term debt including current maturities $ 15,765 |
Accumulated Other Comprehensi31
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | Accumulated other comprehensive loss ("AOCI"), net of taxes, is comprised of the following (in thousands): Foreign Currency Translation Unrealized Gain (Loss) on Available-for- Sale Securities Total Accumulated Other Comprehensive Income (Loss) Balance at December 31, 2014 $ 128 $ 193 $ 321 Other comprehensive income (loss) before reclassifications (92 ) 7 (85 ) Amount reclassified from AOCI — (199 ) (199 ) Transactions with non-controlling interests — — — Net other comprehensive income (loss) at June 30, 2015 $ 36 $ 1 $ 37 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Minimum Lease Commitments of Non-cancellable Operating Leases | Minimum lease commitments for non-cancelable operating leases for the years ended December 31, are as follows (in thousands): 2015 (remaining portion) $ 763 2016 611 2017 493 2018 361 2019 349 Thereafter 2,238 Total non-cancelable operating lease commitments $ 4,815 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Loss for Each Reportable Segment to Consolidated | Segment information, which includes all operating segments, for the three and six months ended June 30, 2015 and June 30, 2014 are shown in the tables below (in thousands): Three months ended Gourmet Food Products Home Décor Nutritionals and Wellness Publishing & Printing Other Consolidated 2015 Revenue $ 5,190 $ 22,459 $ 7,981 $ 271 $ 127 $ 36,028 Gross profit 2,222 9,679 6,397 179 67 18,544 Operating expenses (21,822 ) Loss on marketable securities — Interest expense (565 ) Loss from operations before income tax provision $ (3,843 ) 2014 Revenue $ 1,644 $ 12,437 $ 9,954 $ 319 $ 232 $ 24,586 Gross profit 889 3,730 8,530 206 148 13,503 Operating expenses (17,610 ) Loss on marketable securities (58 ) Interest expense (213 ) Loss from operations before income tax provision $ (4,378 ) Six months ended Gourmet Food Products Home Décor Nutritionals and Wellness Publishing & Printing Other Consolidated 2015 Revenue $ 7,735 $ 32,630 $ 14,757 $ 504 $ 280 $ 55,906 Gross profit 2,757 14,983 11,702 317 181 29,940 Operating expenses (37,413 ) Gain on marketable securities 192 Interest expense (1,164 ) Loss from operations before income tax provision $ (8,445 ) 2014 Revenue $ 2,608 $ 27,458 $ 20,156 $ 613 $ 422 $ 51,257 Gross profit 1,367 8,588 16,595 393 239 27,182 Operating expenses (34,026 ) Loss on marketable securities (552 ) Interest expense (479 ) Loss from operations before income tax provision $ (7,875 ) |
Schedule of Total Assets by Reportable Segments | The below table shows the total assets for each reportable segment, which have been reconciled to the consolidated total assets (in thousands): June 30, 2015 December 31, 2014 Gourmet Food Products $ 1,000 $ 1,142 Home Décor 56,902 28,184 Nutritionals and Wellness 10,737 11,693 All other segments 10,663 16,288 Consolidated total assets $ 79,302 $ 57,307 The below table shows the total assets for each reportable segment, which have been reconciled to the consolidated total assets (in thousands): June 30, 2015 December 31, 2014 Gourmet Food Products $ 1,000 $ 1,142 Home Décor 56,902 28,184 Nutritionals and Wellness 10,737 11,693 All other segments 10,663 16,288 Consolidated total assets $ 79,302 $ 57,307 |
Goodwill and Other Intangible34
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table provides the components of and changes in the carrying amount of Goodwill (in thousands): Acquired Goodwill Accumulated Impairment Other Net Carrying Amount Balance December 31, 2014 $ 7,073 $ (2,978 ) $ — $ 4,095 Additions (a) 1,342 — 3 1,345 Impairment (b) — (192 ) — (192 ) Other (c) — — (6 ) (6 ) Balance June 30, 2015 $ 8,415 $ (3,170 ) $ (3 ) $ 5,242 (a) Related to our acquisition of Kleeneze (see note 3. Acquisitions, Dispositions and Other Transactions) (b) Related to the impairment of Tomboy Tools (c) Primarily reflects the impact of foreign exchange |
Schedule of Identifiable Intangible Assets | The following table provides the components of Identifiable intangible assets (in thousands, except amortization period): Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of June 30, 2015 Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ 3,400 $ — $ 3,400 — Finite-lived intangible assets: Trade name and trademarks 2,179 (2,175 ) 4 0 Other intellectual property 363 (54 ) 309 9 $ 5,942 $ (2,229 ) $ 3,713 9 Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ — $ — $ — — Finite-lived intangible assets: Trade name and trademarks 5,579 (2,348 ) 3,231 19 Other intellectual property 363 (36 ) 327 9 $ 5,942 $ (2,384 ) $ 3,558 17 |
Schedule of Identifiable Intangible Assets | The following table provides the components of Identifiable intangible assets (in thousands, except amortization period): Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of June 30, 2015 Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ 3,400 $ — $ 3,400 — Finite-lived intangible assets: Trade name and trademarks 2,179 (2,175 ) 4 0 Other intellectual property 363 (54 ) 309 9 $ 5,942 $ (2,229 ) $ 3,713 9 Gross Carrying Amount Accumulated Amortization Net Carrying Amount as of Weighted Average Amortization period (in years) Indefinite-lived intangible assets: Trade name and trademarks $ — $ — $ — — Finite-lived intangible assets: Trade name and trademarks 5,579 (2,348 ) 3,231 19 Other intellectual property 363 (36 ) 327 9 $ 5,942 $ (2,384 ) $ 3,558 17 |
Schedule of Estimated Future Amortization Expense of Intangible Assets | As of June 30, 2015 , the estimated future amortization expense associated with our intangible assets for each of the five succeeding fiscal years ending December 31 is as follows (in thousands): Amortization of Intangible Assets 2015 (remaining six months) $ 18 2016 36 2017 36 2018 36 2019 36 Thereafter 151 Total $ 313 |
General (Details)
General (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Accounting Policies [Abstract] | |||
Allowance for doubtful accounts receivable | $ 412 | $ 170 | |
Sales returns and allowances | $ 440 | $ 227 |
Restatement of Condensed Cons36
Restatement of Condensed Consolidated Financials Statements - Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2013 |
Current assets: | ||||
Cash and cash equivalents | $ 5,713 | $ 2,606 | $ 4,177 | $ 3,877 |
Marketable securities | 5,967 | 991 | ||
Accounts receivable, net | 4,316 | 450 | ||
Inventory, net | 20,191 | 14,759 | ||
Other current assets | 3,104 | 2,482 | ||
Total current assets | 39,291 | 21,288 | ||
Restricted cash | 3,026 | 0 | ||
Sale leaseback security deposit | 4,414 | 4,414 | ||
Property, plant and equipment, net | 8,429 | 8,191 | ||
Leased property, net | 14,834 | 15,361 | ||
Goodwill | 5,242 | 4,095 | ||
Intangibles, net | 3,713 | 3,558 | $ 3,558 | |
Other assets | 353 | 400 | ||
Total assets | 79,302 | 57,307 | ||
Current liabilities: | ||||
Accounts payable | 12,714 | 8,541 | ||
Related party payables | 1,421 | 152 | ||
Line of credit | 0 | |||
Accrued commissions | 4,179 | 3,319 | ||
Accrued liabilities | 8,094 | 4,612 | ||
Deferred revenue | 1,763 | 2,982 | ||
Current portion of long-term debt | 914 | 941 | ||
Taxes payable | 3,907 | 2,693 | ||
Other current liabilities | 2,952 | 1,412 | ||
Total current liabilities | 35,944 | 24,652 | ||
Long-term debt | 7,015 | 4,316 | ||
Lease liability | 15,765 | 15,774 | ||
Other long-term liabilities | 2,353 | 3,415 | ||
Total liabilities | 61,077 | 48,324 | ||
Commitments & contingencies | ||||
Stockholders' equity: | ||||
Preferred stock, par value $0.001 per share, 500,000 authorized | 0 | 0 | ||
Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively | 4 | 3 | ||
Additional paid-in capital | 55,468 | 37,097 | ||
Accumulated other comprehensive (loss) income | 37 | 321 | ||
Accumulated deficit | (39,304) | (32,159) | ||
Total stockholders' equity attributable to JRJR33, Inc. | 16,205 | 5,262 | ||
Stockholders' equity attributable to non-controlling interest | 2,020 | 3,721 | ||
Total stockholders' equity | 18,225 | 8,983 | ||
Total liabilities and stockholders' equity | 79,302 | 57,307 | ||
As Previously Reported | ||||
Current assets: | ||||
Cash and cash equivalents | 6,436 | 2,606 | ||
Marketable securities | 5,967 | |||
Accounts receivable, net | 3,966 | |||
Inventory, net | 20,289 | |||
Other current assets | 3,373 | |||
Total current assets | 40,031 | |||
Restricted cash | 3,027 | |||
Sale leaseback security deposit | 4,414 | |||
Property, plant and equipment, net | 8,429 | |||
Leased property, net | 14,834 | |||
Goodwill | 5,246 | |||
Intangibles, net | 3,458 | |||
Other assets | 353 | |||
Total assets | 79,792 | |||
Current liabilities: | ||||
Accounts payable | 12,515 | |||
Related party payables | 635 | |||
Line of credit | 99 | |||
Accrued commissions | 4,056 | |||
Accrued liabilities | 8,316 | |||
Deferred revenue | 2,490 | |||
Current portion of long-term debt | 949 | |||
Taxes payable | 3,842 | |||
Other current liabilities | 3,027 | |||
Total current liabilities | 35,929 | |||
Long-term debt | 7,015 | |||
Lease liability | 15,765 | |||
Other long-term liabilities | 2,353 | |||
Total liabilities | 61,062 | |||
Commitments & contingencies | ||||
Stockholders' equity: | ||||
Preferred stock, par value $0.001 per share, 500,000 authorized | 0 | |||
Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively | 4 | |||
Additional paid-in capital | 55,468 | |||
Accumulated other comprehensive (loss) income | 174 | |||
Accumulated deficit | (38,730) | |||
Total stockholders' equity attributable to JRJR33, Inc. | 16,916 | |||
Stockholders' equity attributable to non-controlling interest | 1,814 | |||
Total stockholders' equity | 18,730 | |||
Total liabilities and stockholders' equity | 79,792 | |||
Restatement Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Current assets: | ||||
Cash and cash equivalents | (723) | 0 | ||
Marketable securities | 0 | |||
Accounts receivable, net | 300 | |||
Inventory, net | (97) | |||
Other current assets | (117) | |||
Total current assets | (637) | |||
Restricted cash | (1) | |||
Sale leaseback security deposit | 0 | |||
Property, plant and equipment, net | 0 | |||
Leased property, net | 0 | |||
Goodwill | (4) | |||
Intangibles, net | 255 | |||
Other assets | 0 | |||
Total assets | (387) | |||
Current liabilities: | ||||
Accounts payable | 3 | |||
Related party payables | 761 | |||
Line of credit | 0 | |||
Accrued commissions | 0 | |||
Accrued liabilities | (79) | |||
Deferred revenue | (727) | |||
Current portion of long-term debt | (92) | |||
Taxes payable | 219 | |||
Other current liabilities | 33 | |||
Total current liabilities | 118 | |||
Long-term debt | 0 | |||
Lease liability | 0 | |||
Other long-term liabilities | 0 | |||
Total liabilities | 118 | |||
Commitments & contingencies | ||||
Stockholders' equity: | ||||
Preferred stock, par value $0.001 per share, 500,000 authorized | 0 | |||
Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively | 0 | |||
Additional paid-in capital | 0 | |||
Accumulated other comprehensive (loss) income | (137) | |||
Accumulated deficit | (574) | |||
Total stockholders' equity attributable to JRJR33, Inc. | (711) | |||
Stockholders' equity attributable to non-controlling interest | 206 | |||
Total stockholders' equity | (505) | |||
Total liabilities and stockholders' equity | (387) | |||
Reclassification Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | $ 0 | ||
Marketable securities | 0 | |||
Accounts receivable, net | 50 | |||
Inventory, net | (1) | |||
Other current assets | (152) | |||
Total current assets | (103) | |||
Restricted cash | 0 | |||
Sale leaseback security deposit | 0 | |||
Property, plant and equipment, net | 0 | |||
Leased property, net | 0 | |||
Goodwill | 0 | |||
Intangibles, net | 0 | |||
Other assets | 0 | |||
Total assets | (103) | |||
Current liabilities: | ||||
Accounts payable | 196 | |||
Related party payables | 25 | |||
Line of credit | (99) | |||
Accrued commissions | 123 | |||
Accrued liabilities | (143) | |||
Deferred revenue | 0 | |||
Current portion of long-term debt | 57 | |||
Taxes payable | (154) | |||
Other current liabilities | (108) | |||
Total current liabilities | (103) | |||
Long-term debt | 0 | |||
Lease liability | 0 | |||
Other long-term liabilities | 0 | |||
Total liabilities | (103) | |||
Commitments & contingencies | ||||
Stockholders' equity: | ||||
Preferred stock, par value $0.001 per share, 500,000 authorized | 0 | |||
Common stock, par value $0.0001 per share, 250,000,000 shares authorized; 34,367,095 and 27,599,012 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively | 0 | |||
Additional paid-in capital | 0 | |||
Accumulated other comprehensive (loss) income | 0 | |||
Accumulated deficit | 0 | |||
Total stockholders' equity attributable to JRJR33, Inc. | 0 | |||
Stockholders' equity attributable to non-controlling interest | 0 | |||
Total stockholders' equity | 0 | |||
Total liabilities and stockholders' equity | $ (103) |
Restatement of Condensed Cons37
Restatement of Condensed Consolidated Financial Statements Restatement of Condensed Consolidated Financials Statements - Balance Sheet Parentheticals (Details) - $ / shares | Jun. 30, 2015 | Dec. 31, 2014 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 500,000 | 500,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 34,367,095 | 27,599,012 |
Common stock, shares outstanding (in shares) | 34,367,095 | 27,599,012 |
As Previously Reported | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | |
Preferred stock, shares authorized (in shares) | 500,000 | |
Common stock, par value (in dollars per share) | $ 0.0001 | |
Common stock, shares authorized (in shares) | 250,000,000 | |
Common stock, shares issued (in shares) | 34,367,095 | |
Common stock, shares outstanding (in shares) | 34,367,095 | |
Restatement Adjustments | Accounting Adjustments Errors from Prior Year | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Preferred stock, par value (in dollars per share) | $ 0 | |
Preferred stock, shares authorized (in shares) | 0 | |
Common stock, par value (in dollars per share) | $ 0 | |
Common stock, shares authorized (in shares) | 0 | |
Common stock, shares issued (in shares) | 0 | |
Common stock, shares outstanding (in shares) | 0 | |
Reclassification Adjustments | Accounting Adjustments Errors from Prior Year | ||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||
Preferred stock, par value (in dollars per share) | $ 0 | |
Preferred stock, shares authorized (in shares) | 0 | |
Common stock, par value (in dollars per share) | $ 0 | |
Common stock, shares authorized (in shares) | 0 | |
Common stock, shares issued (in shares) | 0 | |
Common stock, shares outstanding (in shares) | 0 |
Restatement of Condensed Cons38
Restatement of Condensed Consolidated Financials Statements - Condensed Consolidated Statements of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Revenue | $ 36,028 | $ 24,586 | $ 55,906 | $ 51,257 |
Program costs and discounts | (6,374) | (5,220) | (9,626) | (10,196) |
Net revenue | 29,654 | 19,366 | 46,280 | 41,061 |
Costs of sales | 11,110 | 5,863 | 16,340 | 13,879 |
Gross profit | 18,544 | 13,503 | 29,940 | 27,182 |
Commissions and incentives | 8,447 | 6,005 | 14,268 | 12,978 |
Gain on sale of assets | 40 | 141 | 83 | 407 |
Selling, general and administrative | 12,761 | 10,990 | 23,462 | 19,991 |
Depreciation and amortization | 492 | 445 | 771 | 1,066 |
Share based compensation expense | (30) | 311 | (1,197) | 398 |
Impairment of goodwill | 192 | 0 | 192 | 0 |
Operating loss | (3,278) | (4,107) | (7,473) | (6,844) |
Loss (gain) on sale of marketable securities | 0 | 58 | (192) | 552 |
Interest expense, net | 565 | 213 | 1,164 | 479 |
Loss from operations before income tax provision | (3,843) | (4,378) | (8,445) | (7,875) |
Income tax provision | 195 | 213 | 386 | 492 |
Net loss | (4,038) | (4,591) | (8,831) | (8,367) |
Net loss attributable to non-controlling interest | 1,016 | 1,046 | 1,686 | 1,686 |
Net loss attributable to JRjr33, Inc. | $ (3,022) | $ (3,545) | $ (7,145) | $ (6,681) |
Weighted average common shares outstanding (in shares) | 34,367,095 | 24,400,893 | 32,017,582 | 24,403,486 |
Loss per common share attributable to JRjr33, Inc., basic and diluted (in dollars per share) | $ (0.09) | $ (0.15) | $ (0.22) | $ (0.27) |
As Previously Reported | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Revenue | $ 35,742 | $ 54,961 | ||
Program costs and discounts | (2,998) | (5,160) | ||
Net revenue | 32,744 | 49,801 | ||
Costs of sales | 10,955 | 16,365 | ||
Gross profit | 21,789 | 33,436 | ||
Commissions and incentives | 12,612 | 18,480 | ||
Gain on sale of assets | 40 | 83 | ||
Selling, general and administrative | 12,026 | 21,466 | ||
Depreciation and amortization | 678 | 1,308 | ||
Share based compensation expense | (1,197) | (1,197) | ||
Impairment of goodwill | 192 | 192 | ||
Operating loss | (2,482) | (6,730) | ||
Loss (gain) on sale of marketable securities | 7 | |||
Interest expense, net | 745 | 1,341 | ||
Loss from operations before income tax provision | (3,227) | (8,078) | ||
Income tax provision | 192 | 386 | ||
Net loss | (3,419) | (8,464) | ||
Net loss attributable to non-controlling interest | 1,726 | 1,892 | ||
Net loss attributable to JRjr33, Inc. | $ (1,693) | $ (6,572) | ||
Weighted average common shares outstanding (in shares) | 34,367,095 | 32,017,582 | ||
Loss per common share attributable to JRjr33, Inc., basic and diluted (in dollars per share) | $ (0.05) | $ (0.21) | ||
Restatement Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Revenue | $ 77 | $ 588 | ||
Program costs and discounts | (602) | (1,466) | ||
Net revenue | (525) | (878) | ||
Costs of sales | 466 | 398 | ||
Gross profit | (991) | (1,276) | ||
Commissions and incentives | (1,601) | (1,569) | ||
Gain on sale of assets | 0 | 0 | ||
Selling, general and administrative | 425 | 1,573 | ||
Depreciation and amortization | (186) | (537) | ||
Share based compensation expense | 1,167 | 0 | ||
Impairment of goodwill | 0 | 0 | ||
Operating loss | (796) | (743) | ||
Loss (gain) on sale of marketable securities | (199) | |||
Interest expense, net | (180) | (177) | ||
Loss from operations before income tax provision | (616) | (367) | ||
Income tax provision | 3 | 0 | ||
Net loss | (619) | (367) | ||
Net loss attributable to non-controlling interest | (710) | (206) | ||
Net loss attributable to JRjr33, Inc. | $ (1,329) | $ (573) | ||
Weighted average common shares outstanding (in shares) | 0 | 0 | ||
Loss per common share attributable to JRjr33, Inc., basic and diluted (in dollars per share) | $ (0.04) | $ (0.01) | ||
Reclassification Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Revenue | $ 209 | $ 357 | ||
Program costs and discounts | (2,774) | (3,000) | ||
Net revenue | (2,565) | (2,643) | ||
Costs of sales | (311) | (423) | ||
Gross profit | (2,254) | (2,220) | ||
Commissions and incentives | (2,564) | (2,643) | ||
Gain on sale of assets | 0 | 0 | ||
Selling, general and administrative | 310 | 423 | ||
Depreciation and amortization | 0 | 0 | ||
Share based compensation expense | 0 | 0 | ||
Impairment of goodwill | 0 | 0 | ||
Operating loss | 0 | 0 | ||
Loss (gain) on sale of marketable securities | 0 | |||
Interest expense, net | 0 | 0 | ||
Loss from operations before income tax provision | 0 | 0 | ||
Income tax provision | 0 | 0 | ||
Net loss | 0 | 0 | ||
Net loss attributable to non-controlling interest | 0 | 0 | ||
Net loss attributable to JRjr33, Inc. | $ 0 | $ 0 | ||
Weighted average common shares outstanding (in shares) | 0 | 0 | ||
Loss per common share attributable to JRjr33, Inc., basic and diluted (in dollars per share) | $ 0 | $ 0 |
Restatement of Condensed Cons39
Restatement of Condensed Consolidated Financials Statements - Condensed Consolidated Statements of Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Net loss | $ (4,038) | $ (4,591) | $ (8,831) | $ (8,367) |
Unrealized gain (loss) on marketable securities | ||||
Unrealized holding gain arising during the period | 0 | 184 | 7 | 653 |
Reclassification of other comprehensive loss included in net loss | 0 | 0 | (199) | 0 |
Foreign currency translation adjustment gain (loss) | (266) | 44 | (92) | 34 |
Other comprehensive gain (loss) | (266) | 228 | (284) | 687 |
Comprehensive loss | (4,304) | (4,363) | (9,115) | (7,680) |
Comprehensive loss (income) attributable to non-controlling interests | 1,016 | 1,046 | 1,686 | 1,686 |
Comprehensive loss attributable to JRjr33, Inc. | (3,288) | $ (3,317) | (7,429) | $ (5,994) |
As Previously Reported | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Net loss | (3,419) | (8,464) | ||
Unrealized gain (loss) on marketable securities | ||||
Unrealized holding gain arising during the period | 0 | 7 | ||
Reclassification of other comprehensive loss included in net loss | 0 | 0 | ||
Foreign currency translation adjustment gain (loss) | (463) | (153) | ||
Other comprehensive gain (loss) | (463) | (146) | ||
Comprehensive loss | (3,882) | (8,610) | ||
Comprehensive loss (income) attributable to non-controlling interests | 1,726 | 1,892 | ||
Comprehensive loss attributable to JRjr33, Inc. | (2,156) | (6,718) | ||
Restatement Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Net loss | (619) | (367) | ||
Unrealized gain (loss) on marketable securities | ||||
Unrealized holding gain arising during the period | 0 | 0 | ||
Reclassification of other comprehensive loss included in net loss | 0 | (199) | ||
Foreign currency translation adjustment gain (loss) | 197 | 61 | ||
Other comprehensive gain (loss) | 197 | (138) | ||
Comprehensive loss | (422) | (505) | ||
Comprehensive loss (income) attributable to non-controlling interests | (710) | (206) | ||
Comprehensive loss attributable to JRjr33, Inc. | (1,132) | (711) | ||
Reclassification Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||
Net loss | 0 | 0 | ||
Unrealized gain (loss) on marketable securities | ||||
Unrealized holding gain arising during the period | 0 | 0 | ||
Reclassification of other comprehensive loss included in net loss | 0 | 0 | ||
Foreign currency translation adjustment gain (loss) | 0 | 0 | ||
Other comprehensive gain (loss) | 0 | 0 | ||
Comprehensive loss | 0 | 0 | ||
Comprehensive loss (income) attributable to non-controlling interests | 0 | 0 | ||
Comprehensive loss attributable to JRjr33, Inc. | $ 0 | $ 0 |
Restatement of Condensed Cons40
Restatement of Condensed Consolidated Financials Statements - Condensed Consolidated Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Operating activities: | ||||
Net loss | $ (4,038) | $ (4,591) | $ (8,831) | $ (8,367) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions | ||||
Depreciation and amortization | 1,053 | 1,224 | ||
Loss (gain) on sale of marketable securities | 0 | 58 | (192) | 552 |
Share-based compensation | (1,197) | 398 | ||
Provision for doubtful accounts | 331 | 140 | ||
Gain on sales of assets | (83) | (407) | ||
Deferred income tax | 39 | 45 | 73 | 89 |
Impairment of goodwill | 192 | 0 | 192 | 0 |
Non-cash compensation | 201 | 0 | ||
Changes in certain assets and liabilities: | ||||
Accounts receivable | (1,034) | (136) | ||
Inventory | 1,000 | 1,182 | ||
Other current assets | 628 | (161) | ||
Accounts payable | (1,139) | (168) | ||
Related party payables | 1,268 | (277) | ||
Accrued commissions | 863 | 666 | ||
Accrued liabilities | 2,002 | (100) | ||
Deferred revenue | (468) | 1,289 | ||
Taxes payable | (618) | 811 | ||
Other liabilities | (450) | (2,187) | ||
Net cash used in operating activities | (6,401) | (5,011) | ||
Investing activities: | ||||
Capital expenditures | (332) | (645) | ||
Proceeds from the sale of property, plant and equipment | 60 | 1,831 | ||
Purchase of marketable securities | (18,876) | 0 | ||
Sale of marketable securities | 13,901 | 6,238 | ||
Proceeds from note receivable | 2 | 0 | ||
Deposit of restricted cash collateral | (2,931) | 0 | ||
Acquisitions, net of cash purchased | (3,135) | 2 | ||
Net cash provided by (used in) investing activities | (11,311) | 7,426 | ||
Financing activities: | ||||
Net borrowings on long-term debt and revolving credit facility | 3,051 | 42 | ||
Payments on debt | (471) | (2,662) | ||
Stock issuances | 18,434 | 0 | ||
Net cash provided by (used in) financing activities | 21,014 | (2,620) | ||
Effect of exchange rate changes on cash and cash equivalents | (195) | 505 | ||
Increase in cash and cash equivalents | 3,107 | 300 | ||
Cash and cash equivalents at beginning of period | 2,606 | 3,877 | ||
Cash and cash equivalents at end of period | 5,713 | $ 4,177 | 5,713 | 4,177 |
Cash paid during the period for: | ||||
Interest | 1,164 | $ 130 | ||
As Previously Reported | ||||
Operating activities: | ||||
Net loss | (3,419) | (8,464) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions | ||||
Depreciation and amortization | 1,308 | |||
Loss (gain) on sale of marketable securities | 7 | |||
Share-based compensation | (1,197) | |||
Provision for doubtful accounts | 220 | |||
Gain on sales of assets | (83) | |||
Deferred income tax | 73 | |||
Impairment of goodwill | 192 | 192 | ||
Non-cash compensation | 0 | |||
Changes in certain assets and liabilities: | ||||
Accounts receivable | (748) | |||
Inventory | 754 | |||
Other current assets | 5 | |||
Accounts payable | 522 | |||
Related party payables | 507 | |||
Accrued commissions | 737 | |||
Accrued liabilities | 3,704 | |||
Deferred revenue | (491) | |||
Taxes payable | 1,077 | |||
Other liabilities | (3,798) | |||
Net cash used in operating activities | (5,675) | |||
Investing activities: | ||||
Capital expenditures | (407) | |||
Proceeds from the sale of property, plant and equipment | 187 | |||
Purchase of marketable securities | (18,876) | |||
Sale of marketable securities | 13,900 | |||
Proceeds from note receivable | 1 | |||
Deposit of restricted cash collateral | (3,027) | |||
Acquisitions, net of cash purchased | (3,137) | |||
Net cash provided by (used in) investing activities | (11,359) | |||
Financing activities: | ||||
Net borrowings on long-term debt and revolving credit facility | 3,137 | |||
Payments on debt | (477) | |||
Stock issuances | 18,357 | |||
Net cash provided by (used in) financing activities | 21,017 | |||
Effect of exchange rate changes on cash and cash equivalents | (153) | |||
Increase in cash and cash equivalents | 3,830 | |||
Cash and cash equivalents at beginning of period | 2,606 | |||
Cash and cash equivalents at end of period | 6,436 | 6,436 | ||
Cash paid during the period for: | ||||
Interest | 595 | |||
Restatement Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Operating activities: | ||||
Net loss | (619) | (367) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions | ||||
Depreciation and amortization | (255) | |||
Loss (gain) on sale of marketable securities | (199) | |||
Share-based compensation | 0 | |||
Provision for doubtful accounts | 111 | |||
Gain on sales of assets | 0 | |||
Deferred income tax | 0 | |||
Impairment of goodwill | 0 | 0 | ||
Non-cash compensation | 201 | |||
Changes in certain assets and liabilities: | ||||
Accounts receivable | (286) | |||
Inventory | 246 | |||
Other current assets | 623 | |||
Accounts payable | (1,661) | |||
Related party payables | 761 | |||
Accrued commissions | 126 | |||
Accrued liabilities | (1,702) | |||
Deferred revenue | 23 | |||
Taxes payable | (1,695) | |||
Other liabilities | 3,348 | |||
Net cash used in operating activities | (726) | |||
Investing activities: | ||||
Capital expenditures | 75 | |||
Proceeds from the sale of property, plant and equipment | (127) | |||
Purchase of marketable securities | 0 | |||
Sale of marketable securities | 1 | |||
Proceeds from note receivable | 1 | |||
Deposit of restricted cash collateral | 96 | |||
Acquisitions, net of cash purchased | 2 | |||
Net cash provided by (used in) investing activities | 48 | |||
Financing activities: | ||||
Net borrowings on long-term debt and revolving credit facility | (86) | |||
Payments on debt | 6 | |||
Stock issuances | 77 | |||
Net cash provided by (used in) financing activities | (3) | |||
Effect of exchange rate changes on cash and cash equivalents | (42) | |||
Increase in cash and cash equivalents | (723) | |||
Cash and cash equivalents at beginning of period | 0 | |||
Cash and cash equivalents at end of period | (723) | (723) | ||
Cash paid during the period for: | ||||
Interest | 569 | |||
Reclassification Adjustments | Accounting Adjustments Errors from Prior Year | ||||
Operating activities: | ||||
Net loss | 0 | 0 | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities net of effect of acquisitions | ||||
Depreciation and amortization | 0 | |||
Loss (gain) on sale of marketable securities | 0 | |||
Share-based compensation | 0 | |||
Provision for doubtful accounts | 0 | |||
Gain on sales of assets | 0 | |||
Deferred income tax | 0 | |||
Impairment of goodwill | 0 | 0 | ||
Non-cash compensation | 0 | |||
Changes in certain assets and liabilities: | ||||
Accounts receivable | 0 | |||
Inventory | 0 | |||
Other current assets | 0 | |||
Accounts payable | 0 | |||
Related party payables | 0 | |||
Accrued commissions | 0 | |||
Accrued liabilities | 0 | |||
Deferred revenue | 0 | |||
Taxes payable | 0 | |||
Other liabilities | 0 | |||
Net cash used in operating activities | 0 | |||
Investing activities: | ||||
Capital expenditures | 0 | |||
Proceeds from the sale of property, plant and equipment | 0 | |||
Purchase of marketable securities | 0 | |||
Sale of marketable securities | 0 | |||
Proceeds from note receivable | 0 | |||
Deposit of restricted cash collateral | 0 | |||
Acquisitions, net of cash purchased | 0 | |||
Net cash provided by (used in) investing activities | 0 | |||
Financing activities: | ||||
Net borrowings on long-term debt and revolving credit facility | 0 | |||
Payments on debt | 0 | |||
Stock issuances | 0 | |||
Net cash provided by (used in) financing activities | 0 | |||
Effect of exchange rate changes on cash and cash equivalents | 0 | |||
Increase in cash and cash equivalents | 0 | |||
Cash and cash equivalents at beginning of period | 0 | |||
Cash and cash equivalents at end of period | $ 0 | 0 | ||
Cash paid during the period for: | ||||
Interest | $ 0 |
Acquisitions, Dispositions an41
Acquisitions, Dispositions and Other Transactions - Acquisitions and Dispositions (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 24, 2015 | Jul. 31, 2014 | Mar. 14, 2014 | Mar. 14, 2013 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 04, 2014 | Mar. 31, 2014 | Mar. 04, 2014 |
Business Acquisition [Line Items] | ||||||||||||
Interest rate | 4.00% | |||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||
Goodwill | $ 5,242 | $ 5,242 | $ 4,095 | |||||||||
Secured Debt | HSBC Bank PLC | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Cash consideration transferred | $ 3,000 | |||||||||||
Debt instrument, term | 2 years | |||||||||||
Secured Debt | HSBC Bank PLC | Bank of England Base Rate | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Basis spread on variable interest rate (as a percent) | 0.60% | |||||||||||
Kleeneze Limited | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Percentage of voting interests acquired | 100.00% | |||||||||||
Consideration | $ 5,100 | |||||||||||
Cash payment to acquire business | 2,100 | |||||||||||
Other consideration transferred | 1,900 | |||||||||||
Kleeneze Limited | Secured Debt | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Cash consideration transferred | $ 3,000 | |||||||||||
Kleeneze Limited | Secured Debt | HSBC Bank PLC | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Interest rate | 1.10% | |||||||||||
Kleeneze Limited | Acquisition-related Costs | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Transaction costs | $ 113 | $ 113 | $ 113 | $ 113 | ||||||||
UpperCase Living | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Equity interest issued for acquisition (in shares) | 254,490 | |||||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | |||||||||||
Value assigned for equity interest issued for acquisition | $ 97 | |||||||||||
Common stock delivered to escrow (in shares) | 323,897 | |||||||||||
Fair value of shares of common stock delivered to escrow | $ 123 | |||||||||||
Maximum period to deliver shares of common stock to escrow | 24 months | |||||||||||
Equity interest issuable, accrued liability | $ 220 | |||||||||||
Periodic contingent payment in year 2014, as percent of EBITDA | 10.00% | |||||||||||
Periodic contingent payment in year 2015, as percent of EBITDA | 10.00% | |||||||||||
Periodic contingent payment in year 2016, as percent of EBITDA | 10.00% | |||||||||||
Goodwill | $ 469 | |||||||||||
TLC | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Debt instrument, term | 10 years | |||||||||||
Interest rate | 2.63% | |||||||||||
TLC | Leaseback Agreement | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Purchase of investments available for sale | $ 15,800 | |||||||||||
Gain on disposition of business | $ 2,500 | |||||||||||
Term of lease (in years) | 15 years |
Acquisitions, Dispositions an42
Acquisitions, Dispositions and Other Transactions - Fair Value Kleeneze (Details) - Kleeneze Limited $ in Thousands | Mar. 24, 2015USD ($) |
Business Acquisition [Line Items] | |
Consideration | $ 5,100 |
Amounts recognized for assets acquired and liabilities assumed: | |
Current Assets | 12,164 |
Other long-term assets | 619 |
Current liabilities | 9,030 |
Net assets acquired | 3,753 |
Goodwill and intangible assets | $ 1,347 |
Acquisitions, Dispositions an43
Acquisitions, Dispositions and Other Transactions - Unaudited Pro-forma Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Business Acquisition, Pro Forma Information | ||||
Net loss | $ (4,038) | |||
Revenue | 36,028 | $ 24,586 | $ 55,906 | $ 51,257 |
Kleeneze Limited | ||||
Business Acquisition, Pro Forma Information | ||||
Revenues | 36,028 | 40,092 | 68,718 | 83,238 |
Net loss | (4,049) | (8,898) | (7,366) | |
Net loss attributable to JRjr33, Inc. | $ (3,022) | $ (3,003) | $ (7,212) | $ (5,680) |
Loss per common share attributable to JRjr33, Inc., basic and diluted (in dollars per share) | $ (0.09) | $ (0.12) | $ (0.23) | $ (0.23) |
Revenue | $ 13,118 | $ 13,485 | ||
Net loss, net of intercompany items | (391) | (362) | ||
Intercompany expenses | 404 | 404 | ||
Kleeneze Limited | Acquisition-related Costs | ||||
Business Acquisition, Pro Forma Information | ||||
Write down of intercompany receivables | 33,100 | $ 33,100 | 33,100 | $ 33,100 |
Transaction costs | $ 113 | $ 113 | $ 113 | $ 113 |
Acquisitions, Dispositions an44
Acquisitions, Dispositions and Other Transactions - Public Offering and Other Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Mar. 04, 2015 | Mar. 04, 2015 | Jul. 31, 2014 | Dec. 31, 2014 | May 11, 2015 |
Business Acquisition [Line Items] | |||||
Additional shares issuable under Share Exchange Agreement (in shares) | 25,240,676 | ||||
Period for conditional transfer of right | 10 days | ||||
Ownership interest acquired of all the stock (as a percent) | 15.00% | ||||
Underwritten Public Offering | |||||
Business Acquisition [Line Items] | |||||
Shares issued in transaction (in shares) | 6,667,000 | 6,667,000 | |||
Warrants to purchase common stock (in shares) | 6,667,000 | 6,667,000 | |||
Sale of stock, price per share (in dollars per share) | $ 3 | $ 3 | |||
Exercise price of warrants per share (in dollars per share) | $ 3.75 | $ 3.75 | |||
Expiration period of warrants | 5 years | ||||
Fair value of warrants issued | $ 9 | ||||
Maximum beneficial ownership percentage to exercise warrants without written notice | 4.99% | ||||
Warrants, maximum beneficial ownership percentage with written notice | 9.99% | ||||
Warrants, beneficial ownership percentage, period of notice to change ownership percentage | 61 days | ||||
Over-Allotment Option | |||||
Business Acquisition [Line Items] | |||||
Warrants to purchase common stock (in shares) | 1,000,050 | 1,000,050 | 166,675 | ||
Option period of warrants | 45 days | 45 days | |||
Warrants exercised (in shares) | 113,200 | 113,200 | |||
Number of options exercised (in shares) | 0 | ||||
Expiration period of warrants | 5 years | ||||
TLC | Leaseback Agreement | |||||
Business Acquisition [Line Items] | |||||
Purchase of investments available for sale | $ 15.8 | ||||
Gain on disposition of business | $ 2.5 | ||||
Term of lease (in years) | 15 years |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Investments, Debt and Equity Securities [Abstract] | |||||
Fixed income securities | $ 6,000,000 | $ 6,000,000 | $ 1,000,000 | ||
Payments to acquire marketable securities | 18,900,000 | ||||
Proceeds from sales of marketable securities | 13,901,000 | $ 6,238,000 | |||
Realized losses (gains) from the sale of marketable securities | 0 | $ 58,000 | 192,000 | (552,000) | |
Unrealized holding gain on the investments | $ 0 | $ 184,000 | $ 7,000 | $ 653,000 | |
Marketable securities, effective maturity period | 1 year 2 months 27 days | ||||
Marketable securities, average effective duration | 2 months 19 days |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Raw material and supplies | $ 3,081 | $ 3,052 |
Work in process | 480 | 931 |
Finished goods | 20,981 | 14,852 |
Inventory, gross | 24,542 | 18,835 |
Inventory reserve | (4,351) | (4,076) |
Inventory, net | $ 20,191 | $ 14,759 |
Property, Plant and Equipment47
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Property, plant and equipment | ||
Property, plant and equipment, gross | $ 10,948 | $ 10,038 |
Less accumulated depreciation and amortization | (2,519) | (1,847) |
Property, plant and equipment, net | 8,429 | 8,191 |
Land and improvements | ||
Property, plant and equipment | ||
Property, plant and equipment, gross | 498 | 699 |
Buildings and improvements | ||
Property, plant and equipment | ||
Property, plant and equipment, gross | 6,423 | 6,351 |
Equipment | ||
Property, plant and equipment | ||
Property, plant and equipment, gross | 4,027 | 2,978 |
Construction in progress | ||
Property, plant and equipment | ||
Property, plant and equipment, gross | $ 0 | $ 10 |
Property, Plant and Equipment -
Property, Plant and Equipment - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Property, plant and equipment | |||||
Leased assets, net | $ 8,429 | $ 8,429 | $ 8,191 | ||
Accumulated depreciation | 2,519 | 2,519 | 1,847 | ||
Depreciation and amortization | 492 | $ 445 | 771 | $ 1,066 | |
Sale Leaseback Agreement | |||||
Property, plant and equipment | |||||
Leased assets, net | 14,800 | 14,800 | 15,400 | ||
Accumulated depreciation | 1,000 | 1,000 | $ 439 | ||
Depreciation and amortization | 263 | 527 | |||
Property, Plant and Equipment | |||||
Property, plant and equipment | |||||
Depreciation and amortization related to property, plant and equipment | 361 | 394 | 678 | 963 | |
Cost of Goods Sold | |||||
Property, plant and equipment | |||||
Depreciation included in cost of sales | $ 141 | $ 109 | $ 282 | $ 158 |
Long-term Debt and Other Fina49
Long-term Debt and Other Financing Arrangements (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 | Dec. 04, 2014 |
Convertible Notes Payable and Loans Payable | |||
Interest rate | 4.00% | ||
Long-term debt | $ 7,929 | ||
Total debt | 7,929 | $ 5,257 | |
Less current maturities | (914) | (941) | |
Long-term debt and other financing arrangements, net of current maturities | $ 7,015 | 4,316 | |
Senior secured debt – HSBC Bank PLC | |||
Convertible Notes Payable and Loans Payable | |||
Interest rate | 1.10% | ||
Long-term debt | $ 3,143 | 0 | |
Promissory note—Payable to Former Shareholder of TLC | |||
Convertible Notes Payable and Loans Payable | |||
Interest rate | 2.63% | ||
Long-term debt | $ 3,189 | 3,374 | |
Promissory note—Lega Enterprises, LLC (formerly Agel Enterprises, LLC) | Richmont Street LLC | |||
Convertible Notes Payable and Loans Payable | |||
Interest rate | 5.00% | ||
Long-term debt | $ 1,180 | 1,367 | |
Other miscellaneous notes | |||
Convertible Notes Payable and Loans Payable | |||
Interest rate | 4.00% | ||
Long-term debt | $ 417 | $ 516 |
Long-term Debt and Other Fina50
Long-term Debt and Other Financing Arrangements - Maturities (Details) $ in Thousands | Jun. 30, 2015USD ($) |
Debt Disclosure [Abstract] | |
2015 (remaining portion) | $ 453 |
2,016 | 931 |
2,017 | 4,002 |
2,018 | 715 |
2,019 | 412 |
Thereafter | 1,416 |
Total long-term debt including current maturities | $ 7,929 |
Long-term Debt and Other Fina51
Long-term Debt and Other Financing Arrangements - Narrative (Details) | Jul. 30, 2015$ / sharesshares | Mar. 24, 2015USD ($) | Mar. 04, 2015USD ($)$ / sharesshares | Mar. 04, 2015USD ($)$ / sharesshares | Dec. 04, 2014USD ($) | Jul. 31, 2014building | Jul. 02, 2014$ / sharesshares | May 06, 2014USD ($)$ / sharesshares | Mar. 14, 2013USD ($) | Oct. 22, 2013USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2015USD ($) | May 11, 2015shares | Dec. 31, 2014USD ($) |
Debt Instrument [Line Items] | ||||||||||||||
Restricted cash | $ 3,026,000 | $ 3,026,000 | $ 0 | |||||||||||
Notes issued by the Company | $ 500,000 | |||||||||||||
Interest rate | 4.00% | |||||||||||||
Number of buildings sold | building | 3 | |||||||||||||
Proceeds from issuance of common stock | $ 20,000,000 | |||||||||||||
Proceeds from warrant exercises | 25,001,250 | |||||||||||||
Outstanding Warrants | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Exercise price of warrants per share (in dollars per share) | $ / shares | $ 12.80 | |||||||||||||
Number of warrants granted (in shares) | shares | 50,000 | |||||||||||||
Exercisable term of warrants | 10 days | 75 days | ||||||||||||
Exercise price per share (in dollars per share) | $ / shares | $ 11 | |||||||||||||
Class of warrant term | 10 days | |||||||||||||
Fair value of warrants issued | $ 116,000 | |||||||||||||
Term of consulting agreement | 2 years | |||||||||||||
Period after issuance when warrant is exercisable | 720 days | |||||||||||||
Outstanding Warrants | Subsequent Event | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Exercise price of warrants per share (in dollars per share) | $ / shares | $ 1.16 | |||||||||||||
Number of warrants granted (in shares) | shares | 50,000 | |||||||||||||
Exercisable term of warrants | 10 days | |||||||||||||
Period after issuance when warrant is exercisable | 720 days | |||||||||||||
Outstanding Warrants | Warrant One | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Number of shares into which warrants are exercisable | shares | 12,500 | |||||||||||||
Outstanding Warrants | Warrant Two | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Number of shares into which warrants are exercisable | shares | 6,250 | |||||||||||||
Outstanding Warrants | Maximum | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Exercisable term of warrants | 1 year | |||||||||||||
Underwritten Public Offering | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Proceeds from issuance of common stock | $ 20,000,000 | |||||||||||||
Shares issued in transaction (in shares) | shares | 6,667,000 | 6,667,000 | ||||||||||||
Warrants to purchase common stock (in shares) | shares | 6,667,000 | 6,667,000 | ||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 3 | $ 3 | ||||||||||||
Exercise price of warrants per share (in dollars per share) | $ / shares | $ 3.75 | $ 3.75 | ||||||||||||
Expiration period of warrants | 5 years | |||||||||||||
Fair value of warrants issued | $ 9,000,000 | |||||||||||||
Over-Allotment Option | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Warrants to purchase common stock (in shares) | shares | 1,000,050 | 1,000,050 | 166,675 | |||||||||||
Expiration period of warrants | 5 years | |||||||||||||
Option period of warrants | 45 days | 45 days | ||||||||||||
Warrants exercised (in shares) | shares | 113,200 | 113,200 | ||||||||||||
Number of warrants granted (in shares) | shares | 166,675 | |||||||||||||
TLC | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Debt instrument, term | 10 years | |||||||||||||
Notes issued by the Company | $ 4,000,000 | |||||||||||||
Interest rate | 2.63% | |||||||||||||
HSBC Bank PLC | Secured Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Cash consideration transferred | $ 3,000,000 | |||||||||||||
Debt instrument, term | 2 years | |||||||||||||
HSBC Bank PLC | Bank of England Base Rate | Secured Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Basis spread on variable interest rate (as a percent) | 0.60% | |||||||||||||
Secured Debt | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Restricted cash | $ 3,000,000 | $ 3,000,000 | ||||||||||||
Interest rate | 1.10% | 1.10% | ||||||||||||
Promissory Note - payable to former shareholder of TLC | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Interest rate | 2.63% | 2.63% | ||||||||||||
Promissory Note - payable to former shareholder of TLC | Lega Enterprises, LLC | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Interest rate | 5.00% | |||||||||||||
Principal amount | $ 1,700,000 | |||||||||||||
Maturity date | Oct. 22, 2018 | |||||||||||||
Capital Lease Obligations | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Useful life | 15 years | |||||||||||||
Discount amortization period | 15 years | |||||||||||||
Interest expense on capital leases | $ 552,000 | $ 1,100,000 | ||||||||||||
Gain on sale of real estate | 42,000 | 84,000 | ||||||||||||
Capital Lease Obligations | Other Current Liabilities | ||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||
Current portion of capital lease | $ 35,000 | $ 35,000 |
Long-term Debt and Other Fina52
Long-term Debt and Other Financing Arrangements - Minimum Lease Commitments Capital Leases (Details) $ in Thousands | Jun. 30, 2015USD ($) |
Debt Disclosure [Abstract] | |
2015 (remaining portion) | $ 17 |
2,016 | 73 |
2,017 | 157 |
2,018 | 255 |
2,019 | 371 |
Thereafter | 14,892 |
Total long-term debt including current maturities | $ 15,765 |
Accumulated Other Comprehensi53
Accumulated Other Comprehensive Loss (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2015USD ($) | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at December 31, 2014 | $ 321 |
Net other comprehensive income (loss) at June 30, 2015 | 37 |
Foreign Currency Translation | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at December 31, 2014 | 128 |
Other comprehensive income (loss) before reclassifications | (92) |
Amount reclassified from AOCI | 0 |
Transactions with non-controlling interests | 0 |
Net other comprehensive income (loss) at June 30, 2015 | 36 |
Unrealized Gain (Loss) on Available-for- Sale Securities | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at December 31, 2014 | 193 |
Other comprehensive income (loss) before reclassifications | 7 |
Amount reclassified from AOCI | (199) |
Transactions with non-controlling interests | 0 |
Net other comprehensive income (loss) at June 30, 2015 | 1 |
Total Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |
Balance at December 31, 2014 | 321 |
Other comprehensive income (loss) before reclassifications | (85) |
Amount reclassified from AOCI | (199) |
Transactions with non-controlling interests | 0 |
Net other comprehensive income (loss) at June 30, 2015 | $ 37 |
Fair Value (Details)
Fair Value (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | $ 6,000,000 | $ 129,000 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale securities | $ 0 | $ 862,000 |
Commitments and Contingencies -
Commitments and Contingencies - Minimum Lease Commitments for Non-cancellable Operating Leases (Details) $ in Thousands | Jun. 30, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2015 (remaining portion) | $ 763 |
2,016 | 611 |
2,017 | 493 |
2,018 | 361 |
2,019 | 349 |
Thereafter | 2,238 |
Total non-cancelable operating lease commitments | $ 4,815 |
Commitments and Contingencies56
Commitments and Contingencies (Details) - USD ($) $ in Millions | Jun. 30, 2015 | Dec. 31, 2014 |
Commitments and Contingencies Disclosure [Abstract] | ||
Workers compensation liability | $ 1 | $ 1 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Net deferred tax asset | $ 0 | $ 0 | ||
Income Tax Contingency [Line Items] | ||||
Deferred income tax expense | 39,000 | $ 45,000 | 73,000 | $ 89,000 |
Current foreign tax expense | 156,000 | 168,000 | 313,000 | 403,000 |
Domestic Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Current income tax expense | 0 | 0 | 0 | 0 |
Foreign Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | 0 | $ 0 | 0 | $ 0 |
Other Current Liabilities | ||||
Income Tax Contingency [Line Items] | ||||
Deferred tax liability | $ 547,000 | $ 547,000 |
Share-Based Compensation Plans
Share-Based Compensation Plans (Details) | Jun. 23, 2015officer$ / sharesshares | Jun. 30, 2015USD ($)shares | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)planshares | Jun. 30, 2014USD ($) | May 22, 2015shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of share-based compensation plans | plan | 2 | |||||
Share-based compensation expense | $ (30,000) | $ 311,000 | $ (1,197,000) | $ 398,000 | ||
Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period of share-based compensation awards | 3 years | |||||
Share-based compensation expense | 0 | 0 | ||||
Unrecognized compensation cost related to unvested share-based compensation | 117,000 | $ 117,000 | ||||
Period for recognition for unrecognized compensation cost related to unvested share-based compensation | 3 years | |||||
Option awards granted (in shares) | shares | 50,000 | |||||
Option award exercise price (in dollars per share) | $ / shares | $ 1.23 | |||||
Executive officers | officer | 2 | |||||
Fair value of option awards granted | 117,000 | $ 117,000 | ||||
SARs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period of share-based compensation awards | 3 years | |||||
Contractual term of share-based compensation awards | 5 years | |||||
Unrecognized compensation cost related to unvested share-based compensation | 96,000 | $ 96,000 | ||||
Period for recognition for unrecognized compensation cost related to unvested share-based compensation | 3 years | |||||
SARs | Selling, General and Administrative Expenses | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation expense | $ (30,000) | $ 311,000 | $ (1,200,000) | $ 398,000 | ||
Stock Options | 2015 Stock Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Contractual term of share-based compensation awards | 10 years | |||||
Number of shares authorized under stock option plan | shares | 1,500,000 | |||||
Maximum number of options authorized to be granted to single stockholder | shares | 500,000 | |||||
Stock options issued and outstanding (in shares) | shares | 1,400,000 | 1,400,000 |
Loss Per Share Attributable t59
Loss Per Share Attributable to the Company (Details) | 6 Months Ended |
Jun. 30, 2015shares | |
Warrants | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share | 6,996,875 |
Options | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share | 100,000 |
Segment Information - Narrative
Segment Information - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015USD ($)country | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)countrysegment | Jun. 30, 2014USD ($)segmentcategory | Dec. 31, 2014USD ($) | |
Segment Reporting Information [Line Items] | |||||
Amount of net revenues generated in international markets | $ 29,654 | $ 19,366 | $ 46,280 | $ 41,061 | |
Number of operating segments | segment | 5 | ||||
Number of reportable business segments | segment | 3 | 1 | |||
Categories within business segments | category | 5 | ||||
Assets | $ 79,302 | $ 79,302 | $ 57,307 | ||
Home Décor | |||||
Segment Reporting Information [Line Items] | |||||
Increase in assets | $ 28,700 | ||||
Nutritionals and Wellness | |||||
Segment Reporting Information [Line Items] | |||||
Countries of operation (amount over) | country | 40 | 40 | |||
International Markets | |||||
Segment Reporting Information [Line Items] | |||||
Amount of net revenues generated in international markets | $ 25,700 | $ 10,800 | $ 34,800 | $ 21,600 | |
Net revenues | International Markets | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of net revenues generated in international markets (as percent) | 71.40% | 43.90% | 62.30% | 42.10% | |
Consolidated revenue | |||||
Segment Reporting Information [Line Items] | |||||
Percentage of net revenues generated in international markets (as percent) | 75.00% | ||||
Operating Segments | Home Décor | Kleeneze Limited | |||||
Segment Reporting Information [Line Items] | |||||
Assets | $ 20,800 | $ 20,800 |
Segment Information - Revenues
Segment Information - Revenues and Profits by Operating Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | $ 36,028 | $ 24,586 | $ 55,906 | $ 51,257 |
Gross profit | 18,544 | 13,503 | 29,940 | 27,182 |
Operating expenses | (21,822) | (17,610) | (37,413) | (34,026) |
Loss on marketable securities | 0 | (58) | 192 | (552) |
Interest expense | (565) | (213) | (1,164) | (479) |
Loss from operations before income tax provision | (3,843) | (4,378) | (8,445) | (7,875) |
Operating Segments | Gourmet Food Products | ||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | 5,190 | 1,644 | 7,735 | 2,608 |
Gross profit | 2,222 | 889 | 2,757 | 1,367 |
Operating Segments | Home Décor | ||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | 22,459 | 12,437 | 32,630 | 27,458 |
Gross profit | 9,679 | 3,730 | 14,983 | 8,588 |
Operating Segments | Nutritionals and Wellness | ||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | 7,981 | 9,954 | 14,757 | 20,156 |
Gross profit | 6,397 | 8,530 | 11,702 | 16,595 |
Operating Segments | Publishing & Printing | ||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | 271 | 319 | 504 | 613 |
Gross profit | 179 | 206 | 317 | 393 |
Operating Segments | Other | ||||
Reconciliation of Operating Profit (Loss) from Segments to Consolidated [Abstract] | ||||
Revenue | 127 | 232 | 280 | 422 |
Gross profit | $ 67 | $ 148 | $ 181 | $ 239 |
Segment Information - Assets by
Segment Information - Assets by Reportable Segments (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Dec. 31, 2014 |
Segment Reporting Information [Line Items] | ||
Assets | $ 79,302 | $ 57,307 |
Reportable segments | Gourmet Food Products | ||
Segment Reporting Information [Line Items] | ||
Assets | 1,000 | 1,142 |
Reportable segments | Home Décor | ||
Segment Reporting Information [Line Items] | ||
Assets | 56,902 | 28,184 |
Reportable segments | Nutritionals and Wellness | ||
Segment Reporting Information [Line Items] | ||
Assets | 10,737 | 11,693 |
All other segments | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 10,663 | $ 16,288 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | Jul. 11, 2014 | Jul. 01, 2014 | Jun. 27, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Feb. 26, 2015 | Dec. 31, 2014 | Sep. 25, 2012 |
Richmont Holdings Inc | Related-party payables | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Due to related parties, current | $ 396 | $ 396 | $ 120 | |||||||
Richmont Capital Partners VM | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Due to related parties, current | $ 425 | |||||||||
Rochon Capital Partners, Ltd. | Related-party payables | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Due to related parties, current | $ 25 | |||||||||
Tamala L. Longaberger | AEI | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Interest rate on related party notes payable (as percent) | 10.00% | 10.00% | 10.00% | |||||||
Tamala L. Longaberger | Related-party payables | TLC | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party notes payable | $ 42 | |||||||||
Tamala L. Longaberger | Related-party payables | AEI | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party notes payable | $ 800 | $ 158 | ||||||||
Selling, General and Administrative Expenses | Richmont Holdings Inc | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Expense reimbursement fees | $ 552 | $ 480 | $ 1,100 | $ 960 |
Goodwill and Other Intangible64
Goodwill and Other Intangible Assets - Goodwill (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($)segment | Jun. 30, 2014USD ($) | |
Goodwill [Line Items] | ||||
Number of operating segments | segment | 5 | |||
Impairment of goodwill | $ 192 | $ 0 | $ 192 | $ 0 |
Goodwill | 5,242 | 4,095 | ||
Accumulated impairment of goodwill | 3,170 | 2,978 | ||
Goodwill [Roll Forward] | ||||
Acquired goodwill at beginning of period | 7,073 | |||
Accumulated impairment at beginning of period | (2,978) | |||
Net carrying amount, beginning balance | 4,095 | |||
Additions | 1,345 | |||
Impairment of goodwill | (192) | $ 0 | (192) | $ 0 |
Goodwill, other | (6) | |||
Acquired goodwill at end of period | 8,415 | 8,415 | ||
Accumulated impairment at end of period | (3,170) | (3,170) | ||
Goodwill, other, net increase | (3) | |||
Net carrying amount, ending balance | 5,242 | 5,242 | ||
Kleeneze Limited | ||||
Goodwill [Roll Forward] | ||||
Additions | 1,342 | |||
Additions, Other | 3 | |||
Tomboy Tools | ||||
Goodwill [Line Items] | ||||
Impairment of goodwill | 192 | |||
Goodwill | 190 | 190 | ||
Accumulated impairment of goodwill | 375 | 375 | ||
Goodwill [Roll Forward] | ||||
Impairment of goodwill | (192) | |||
Accumulated impairment at end of period | (375) | (375) | ||
Net carrying amount, ending balance | $ 190 | $ 190 |
Goodwill and Other Intangible65
Goodwill and Other Intangible Assets - Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | $ 0 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated Amortization | $ (2,229) | (2,384) | |
Total | 313 | ||
Intangible Assets, Net (Excluding Goodwill) | $ 3,713 | $ 3,558 | $ 3,558 |
Weighted Average Amortization period (in years) | 9 years | 17 years | |
Intangible Assets, Gross (Excluding Goodwill) | $ 5,942 | $ 5,942 | |
Trade name and trademarks | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived intangible assets | 3,400 | ||
Trade name and trademarks | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 2,179 | 5,579 | |
Accumulated Amortization | (2,175) | (2,348) | |
Total | $ 4 | $ 3,231 | |
Weighted Average Amortization period (in years) | 0 years | 19 years | |
Other intellectual property | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 363 | $ 363 | |
Accumulated Amortization | (54) | (36) | |
Total | $ 309 | $ 327 | |
Weighted Average Amortization period (in years) | 9 years | 9 years |
Goodwill and Other Intangible66
Goodwill and Other Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Indefinite-lived Intangible Assets [Line Items] | ||||
Amortization expense | $ 9 | $ 51 | $ 152 | $ 103 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||||
2015 (remaining six months) | 18 | 18 | ||
2,016 | 36 | 36 | ||
2,017 | 36 | 36 | ||
2,018 | 36 | 36 | ||
2,019 | 36 | 36 | ||
Thereafter | 151 | 151 | ||
Total | $ 313 | 313 | ||
Pro Forma | ||||
Indefinite-lived Intangible Assets [Line Items] | ||||
Amortization expense | 18 | |||
Amortization of indefinite-lived intangibles | Restatement Adjustments | Trade name and trademarks | ||||
Indefinite-lived Intangible Assets [Line Items] | ||||
Amortization expense | $ (170) |
Subsequent Events (Details)
Subsequent Events (Details) | Jul. 30, 2015agreement$ / sharesshares | Jul. 02, 2014$ / sharesshares | May 06, 2014 | Jun. 30, 2015$ / shares | Dec. 31, 2014$ / shares |
Subsequent Event [Line Items] | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||
Outstanding Warrants | |||||
Subsequent Event [Line Items] | |||||
Number of warrants granted (in shares) | shares | 50,000 | ||||
Exercise price of warrants per share (in dollars per share) | $ / shares | $ 12.80 | ||||
Exercisable term of warrants | 10 days | 75 days | |||
Period after issuance when warrant is exercisable | 720 days | ||||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | ||||
Subsequent Event | Consultants | |||||
Subsequent Event [Line Items] | |||||
Number of consulting agreements | agreement | 2 | ||||
Option awards granted (in shares) | shares | 1,000,000 | ||||
Option award exercise price (in dollars per share) | $ / shares | $ 1.27 | ||||
Subsequent Event | Outstanding Warrants | |||||
Subsequent Event [Line Items] | |||||
Number of warrants granted (in shares) | shares | 50,000 | ||||
Exercise price of warrants per share (in dollars per share) | $ / shares | $ 1.16 | ||||
Exercisable term of warrants | 10 days | ||||
Period after issuance when warrant is exercisable | 720 days | ||||
Subsequent Event | Other Warrants | Consultant One | |||||
Subsequent Event [Line Items] | |||||
Option awards granted (in shares) | shares | 500,000 | ||||
Subsequent Event | Other Warrants | Consultant Two | |||||
Subsequent Event [Line Items] | |||||
Option awards granted (in shares) | shares | 500,000 |