Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Sep. 30, 2016 | Nov. 04, 2016 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | FN | |
Entity Registrant Name | FABRINET | |
Entity Central Index Key | 1,408,710 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 36,856,532 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Current assets | ||
Cash and cash equivalents | $ 105,860 | $ 142,804 |
Marketable securities | 147,702 | 141,709 |
Trade accounts receivable, net | 212,684 | 196,145 |
Inventory, net | 205,484 | 181,499 |
Deferred tax assets | 1,358 | |
Prepaid expenses | 3,511 | 3,114 |
Other current assets | 5,210 | 6,662 |
Total current assets | 680,451 | 673,291 |
Non-current assets | ||
Restricted cash in connection with business acquisition | 3,379 | |
Property, plant and equipment, net | 205,845 | 178,410 |
Intangibles, net | 5,091 | 499 |
Goodwill | 2,994 | 0 |
Deferred tax assets | 2,503 | 1,806 |
Deferred debt issuance costs on revolving loan and other non-current assets | 1,040 | 1,851 |
Total non-current assets | 220,852 | 182,566 |
Total Assets | 901,303 | 855,857 |
Current liabilities | ||
Bank borrowings, net of unamortized debt issuance costs | 37,516 | 24,307 |
Trade accounts payable | 179,741 | 172,052 |
Fixed assets payable | 19,694 | 20,628 |
Capital lease liability, current portion | 122 | |
Income tax payable | 3,077 | 2,010 |
Accrued payroll, bonus and related expenses | 12,417 | 12,300 |
Accrued expenses | 6,462 | 8,072 |
Other payables | 10,214 | 16,356 |
Total current liabilities | 269,243 | 255,725 |
Non-current liabilities | ||
Long-term loan from bank, non-current portion, net of unamortized debt issuance costs | 32,759 | 36,100 |
Deferred tax liability | 854 | |
Capital lease liability, non-current portion | 1,556 | |
Deferred liability in connection with business acquisition | 3,379 | |
Severance liabilities | 7,154 | 6,684 |
Other non-current liabilities | 2,179 | 2,075 |
Total non-current liabilities | 47,027 | 45,713 |
Total Liabilities | 316,270 | 301,438 |
Commitments and contingencies (Note 16) | ||
Shareholders' equity | ||
Preferred shares (5,000,000 shares authorized, $0.01 par value; no shares issued and outstanding as of September 30, 2016 and June 24, 2016) | ||
Ordinary shares (500,000,000 shares authorized, $0.01 par value; 36,700,468 shares and 36,156,446 shares issued and outstanding as of September 30, 2016 and June 24, 2016, respectively) | 367 | 362 |
Additional paid-in capital | 109,772 | 102,325 |
Accumulated other comprehensive income | 987 | 591 |
Retained earnings | 473,907 | 451,141 |
Total Shareholders' Equity | 585,033 | 554,419 |
Total Liabilities and Shareholders' Equity | $ 901,303 | $ 855,857 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Jun. 24, 2016 |
Preferred shares, shares authorized | 5,000,000 | 5,000,000 |
Preferred shares, par value | $ 0.01 | $ 0.01 |
Preferred shares, shares issued | 0 | 0 |
Preferred shares, shares outstanding | 0 | 0 |
Ordinary shares, shares authorized | 500,000,000 | 500,000,000 |
Ordinary shares, par value | $ 0.01 | $ 0.01 |
Ordinary shares, shares issued | 36,700,468 | 36,156,446 |
Ordinary shares, shares outstanding | 36,700,468 | 36,156,446 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Revenues | $ 332,043 | $ 216,433 |
Cost of revenues | (292,435) | (190,422) |
Gross profit | 39,608 | 26,011 |
Selling, general and administrative expenses | (15,832) | (11,900) |
Other expense related to flooding | (864) | |
Operating income | 23,776 | 13,247 |
Interest income | 437 | 442 |
Interest expense | (1,322) | (402) |
Foreign exchange gain (loss), net | 1,657 | (10,492) |
Other income | 143 | 103 |
Income before income taxes | 24,691 | 2,898 |
Income tax expense | (1,925) | (1,295) |
Net income | 22,766 | 1,603 |
Other comprehensive income, net of tax: | ||
Change in net unrealized (loss) gains on marketable securities | (187) | 87 |
Change in net unrealized loss on derivative instruments | (158) | |
Change in foreign currency translation adjustment | 741 | |
Other comprehensive income (loss) | 396 | 87 |
Net comprehensive income | $ 23,162 | $ 1,690 |
Earnings per share | ||
Basic | $ 0.63 | $ 0.05 |
Diluted | $ 0.61 | $ 0.04 |
Weighted-average number of ordinary shares outstanding (thousands of shares) | ||
Basic | 36,404 | 35,579 |
Diluted | 37,330 | 36,315 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Cash flows from operating activities | ||
Net income for the period | $ 22,766 | $ 1,603 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 5,113 | 4,063 |
Gain on disposal of property, plant and equipment | (40) | (26) |
Loss from sales and maturities of available-for-sale securities | 100 | 92 |
Amortization of investment premium | 166 | 298 |
Amortization of deferred debt issuance costs | 908 | 171 |
Allowance for doubtful accounts (reversal of) | 3 | (4) |
Unrealized (gain) loss on exchange rate and fair value of derivative instruments | (1,913) | 10,855 |
Share-based compensation | 5,611 | 2,673 |
Deferred income tax | 311 | 157 |
Other non-cash expenses | 453 | 386 |
(Reversal of) inventory obsolescence | (62) | 150 |
Loss from written-off inventory due to flood loss | 233 | |
Changes in operating assets and liabilities | ||
Trade accounts receivable | (11,876) | (4,948) |
Inventory | (21,290) | (13,150) |
Other current assets and non-current assets | 3,285 | (668) |
Trade accounts payable | 3,103 | 3,053 |
Income tax payable | 1,035 | 707 |
Other current liabilities and non-current liabilities | (8,675) | (1,106) |
Net cash (used in) provided by operating activities | (1,002) | 4,539 |
Cash flows from investing activities | ||
Purchase of marketable securities | (32,737) | (38,773) |
Proceeds from sales of marketable securities | 13,061 | 16,687 |
Proceeds from maturities of marketable securities | 13,230 | 12,528 |
Payments in connection with business acquisition, net of cash acquired | (9,664) | |
Restricted cash in connection with business acquisition | (3,379) | |
Purchase of property, plant and equipment | (27,090) | (8,452) |
Purchase of intangibles | (178) | (68) |
Deposits for land purchase | (2,352) | |
Proceeds from disposal of property, plant and equipment | 107 | 28 |
Net cash used in investing activities | (46,650) | (20,402) |
Cash flows from financing activities | ||
Payment of debt issuance costs | (353) | |
Proceeds from revolving loans | 13,500 | |
Repayment of long-term loans from bank | (4,900) | (1,500) |
Proceeds from issuance of ordinary shares under employee share option plans | 2,708 | 1,547 |
Withholding tax related to net share settlement of restricted share units | (867) | (878) |
Net cash provided by (used in) financing activities | 10,441 | (1,184) |
Net decrease in cash and cash equivalents | (37,211) | (17,047) |
Movement in cash and cash equivalents | ||
Cash and cash equivalents at beginning of period | 142,804 | 112,978 |
Decrease in cash and cash equivalents | (37,211) | (17,047) |
Effect of exchange rate on cash and cash equivalents | 267 | (466) |
Cash and cash equivalents at end of period | 105,860 | 95,465 |
Non-cash investing and financing activities | ||
Construction and equipment-related payables | $ 19,694 | $ 5,123 |
Business and organization
Business and organization | 3 Months Ended |
Sep. 30, 2016 | |
Business and organization | 1. Business and organization General Fabrinet (“Fabrinet” or the “Parent Company”) was incorporated on August 12, 1999, and commenced operations on January 1, 2000. The Parent Company is an exempted company incorporated in the Cayman Islands, British West Indies. The “Company” refers to Fabrinet and its subsidiaries as a group. The Company provides advanced optical packaging and precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers (“OEMs”) of complex products, such as optical communication components, modules and sub-systems, industrial lasers, medical devices and sensors. The Company offers a broad range of advanced optical and electro-mechanical capabilities across the entire manufacturing process, including process design and engineering, supply chain management, manufacturing, complex printed circuit board assembly, advanced packaging, integration, final assembly and testing. The Company focuses primarily on the production of low-volume, high-mix products. The principal subsidiaries of Fabrinet include Fabrinet Co., Ltd. (“Fabrinet Thailand”), Casix, Inc. (“Casix”) and Fabrinet West, Inc. (“Fabrinet West”). |
Accounting policies
Accounting policies | 3 Months Ended |
Sep. 30, 2016 | |
Accounting policies | 2. Accounting policies Basis of presentation The accompanying unaudited condensed consolidated financial statements for Fabrinet as of September 30, 2016 and for the three months ended September 30, 2016 and September 25, 2015 includes normal recurring adjustments, necessary for a fair presentation of the financial statements set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in Fabrinet’s Annual Report on Form 10-K for the year ended June 24, 2016. The balance sheet as of June 24, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results for the three months ended September 30, 2016 may not be indicative of results for the year ending June 30, 2017 or any future periods. Where necessary, comparative figures have been reclassified to conform to the current period accounting policies and presentation adopted. On September 14, 2016, the Company acquired 100% of the shares of Global CEM Solutions, Ltd. and all of its subsidiaries, a privately-held group located in Wiltshire, United Kingdom (“Exception EMS”). The unaudited condensed consolidated financial statements of the Company include the financial position, results of operations and the cash flows of Exception EMS commencing as of the acquisition date. See Note 8 - Business acquisitions for further details on the accounting for this transaction. Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, and the reported amount of total revenues and expenses during the year. The Company bases estimates on historical experience and various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial position or results of operations may be materially different under different conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies, which are discussed below. Significant assumptions are used in accounting for share-based compensation, allowance for doubtful accounts, income taxes, inventory obsolescence and valuation of intangible assets related to business acquisition, among others. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates. In the event that estimates or assumptions prove to differ from actual results, adjustments will be made in subsequent periods to reflect more current information. Fiscal years The Company utilizes a 52-53 week fiscal year ending on the Friday in June closest to June 30. The three months ended September 30, 2016 and September 25, 2015 each consisted of 14 weeks and 13 weeks, respectively. Fiscal year 2017 will be comprised of 53 weeks and will end on June 30, 2017. Concentration of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, marketable securities, derivatives, and accounts receivable. Cash, cash equivalents, and marketable securities are maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions with reputable credit and therefore bear minimal credit risk. The Company seeks to mitigate its credit risks by spreading such risks across multiple counterparties and monitoring the risk profiles of these counterparties. The Company limits its investments in marketable securities to securities with a maturity not in excess of three years, and all marketable securities that the Company invests in are rated A1, P-1, F1, or better. The Company performs ongoing credit evaluations for credit worthiness of its customers and usually does not require collateral from its customers. Management has implemented a program to closely monitor near term cash collection and credit exposures to mitigate any material losses. Derivatives The derivatives assets and liabilities are recognized on the consolidated balance sheets as other current assets or accrued expenses measured at fair value. The Company applies hedge accounting to arrangements that qualify and are designated for cash flow hedge accounting treatment. Hedge accounting is discontinued prospectively if the hedging relationship ceases to be effective or the hedging or hedged items cease to exist as a result of maturity, sale, termination or cancellation. Derivatives designated and qualifying as hedges of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges which include forward currency contracts. In a cash flow hedging relationship, the effective portion of the change in the fair value of the hedging derivative is initially recorded in accumulated other comprehensive income (loss) (“AOCI”), while any ineffective portion is recognized directly in earnings, as a component of other income (expense). The portion of gain or loss on the derivative instrument remains in AOCI until the forecasted transaction is recognized in earnings. The Company also enters into derivative contracts that are intended to economically hedge certain of the Company’s risks. The changes in the fair value of the derivatives are recorded directly in earnings as a component of other income (expense), net. In accordance with the fair value measurement guidance, the Company’s accounting policy is to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. The Company executes derivative instruments with financial institutions that are credit-worthy, defined as institutions that hold an investment grade credit rating. Business acquisition For the acquisition of Exception EMS, the Company allocated the fair value of purchase consideration to the assets acquired and liability assumed based on their fair values at the acquisition date. The total consideration and the allocation of consideration to the individual net assets is preliminary, as there are remaining uncertainties to be resolved, including the settlement of the final net working capital adjustment and the finalization of the estimated fair value attributable to the acquired intangible assets. The acquired intangible assets include customer relationships and backlog and are recorded as intangibles in the unaudited condensed consolidated balance sheets. The fair value of the acquired intangible assets was determined based on the multi-period excess earnings method. The Company reviews intangibles for impairment annually or whenever changes or circumstances indicate the carrying amount may not be recoverable. In connection with the business acquisition, $3.4 million of cash for deferred consideration was placed into an escrow account which is under the Company controls. However, the Company has contractually agreed to remit this deferred consideration to the sellers of Exception EMS, subject to the resolution of claims that the Company may make against the funds with respect to indemnification and other claims within 24 months from the closing date of the transaction. The cash is presented as restricted cash in the unaudited condensed consolidated balance sheets and the related liability is presented within non-current liabilities for the deferred consideration. Goodwill Goodwill arising from the acquisition is primarily attributable to the ability to expand future products and services and the assembled workforce. Goodwill is reviewed annually for impairment or more frequently whenever changes or circumstances indicate the carrying amount of goodwill may not be recoverable. Capital lease Certain machine and equipment held under capital leases are classified as property, plant and equipment and amortized using the straight-line method over the terms of the lease contracts. The related obligations from the capital lease are recorded as liabilities in the unaudited condensed consolidated balance sheets. New Accounting Pronouncements – not yet adopted by the Company In October 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-16, “Income Taxes (Topic 740) – Intra-Entity Transfers of Assets Other Than Inventory,” which eliminates the exception for an intra-entity transfer of an asset other than inventory that prohibits the recognition of current and deferred income taxes until the asset has been sold to an outside party. The entity should recognize income tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. For public entities, this update is effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting period for which financial statements have not been issued or made available for issuance. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).” The amendments in this ASU provide guidance on the presentation of certain cash receipts and cash payments in the statement of cash flows in order to reduce diversity in existing practice. The amendments in ASU 2016-15 are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This ASU simplifies several aspects of the accounting for share-based payment award transactions, including, the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, for public companies. Early adoption is permitted for any entity in any interim or annual period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-05, “Derivatives and Hedging (Topic 815),” to clarify that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument under Topic 815, does not, in and of itself, require designation of the hedging relationship, provided that all other hedge accounting criteria continue to be met. This guidance is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Lease (Topic 842).” The core principle of Topic 842 is that a lessee should recognize the lease assets and liabilities that arise from leases in the statement of financial position. For public business entities, this update is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” This new guidance requires certain equity investments to be measured at fair value, use of the exit price notion and separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The ASU on recognition and measurement will take effect for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” The update provides the guidance that an entity, that measured inventory by using first-in, first-out or average cost, should measure inventory at the lower of cost and net realizable value. Subsequent measurement is unchanged for inventory measured using last-in, first-out or the retail inventory method. The update is effective for fiscal years beginning after December 15, 2016, including interim periods within these fiscal years. This update should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting date. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The amendments require management to evaluate, for each annual and interim reporting period, an entity’s ability to continue as a going concern when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations that become due within one year after the date that the financial statements are issued (or available to be issued). This ASU is effective for annual periods and interim reporting periods beginning after December 15, 2016. The Company does not expect that the adoption of this update will have an effect on its consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606), issued as a new Topic, Accounting Standards Codification.” The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update is effective for public companies, as amended by ASU 2015-14, for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Earlier application of this guidance is permitted, but not before the original date of December 15, 2016, which can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. Subsequently, in March 2016 and April 2016, the FASB issued ASU 2016-08 and ASU 2016-10, to clarify the implementation guidance on principle versus agent considerations and address the potential diversity in practice at initial application and cost; and the complexity of applying Topic 606, both at transition and on an ongoing basis related to identification of performance obligations and licensing arrangements; and ASU 2016-12, in May 2016, to improve in certain aspects of Topic 606, with the same effective date as ASU 2015-14. The Company will adopt this standard during its fiscal year ending June 28, 2018. In the current period, the Company is assessing the contracts with its customers to identify the impact to its consolidated financial statements. The process is still ongoing and the Company expects to make significant progress in the coming quarters. New Accounting Pronouncements – adopted by the Company In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes,” which will require entities to present deferred tax assets (“DTAs”) and deferred tax liabilities (“DTLs”) as non-current in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and non-current in a classified balance sheet. The Company adopted of this update early. Accordingly, as of September 30, 2016, DTAs of $1.2 million were classified to non-current in the unaudited condensed consolidated balance sheets. The Company adopted this update on a prospective basis and did not change the presentation of the comparative period. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments” which require an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The Company has adopted of this update and applied it on a prospective basis. In April 2015, the FASB issued ASU 2015-03, “Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The update requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset. Debt disclosures will include the face amount of the debt liability and the effective interest rate. The update requires retrospective application and represents a change in accounting principle. Additionally, in August 2015, the FASB issued ASU 2015-15, “Interest – Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” to amend ASU 2015-03. The Company has adopted this amendment retrospectively. As of September 30, 2016 and June 24, 2016, debt issuance costs of $0.5 million and $0.6 million, respectively, related to a recognized debt liability are presented in the balance sheet as a direct reduction of the carrying amount of the related debts. In February 2015, the FASB issued ASU 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis.” ASU No. 2015-02 amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The Company has adopted this update with no impact to the unaudited condensed consolidated financial statements. In January 2015, the FASB issued ASU 2015-01, “Income Statement – Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” The objective of this amendment is to reduce the complexity in accounting standards by eliminating the concept of extraordinary items from U.S. GAAP. To meet for extraordinary classification the underlying event or transaction should (a) possess a high degree of abnormality and be of a type clearly unrelated to, or only incidentally related to, the ordinary and typical activities of the entity and (b) not reasonably be expected to recur in the foreseeable future. The Company has adopted this update with no impact to the unaudited condensed consolidated financial statements. |
Earnings per ordinary share
Earnings per ordinary share | 3 Months Ended |
Sep. 30, 2016 | |
Earnings per ordinary share | 3. Earnings per ordinary share Basic earnings per ordinary share is computed by dividing reported net income by the weighted-average number of ordinary shares outstanding during each period. Diluted earnings per ordinary share is computed by calculating the effect of potential dilutive ordinary shares outstanding during the period using the treasury stock method. Dilutive ordinary equivalent shares consist of share options, restricted share units and performance share units. Earnings per ordinary share was calculated as follows: Three Months Ended (amount in thousands except per share amounts) September 30, 2016 September 25, 2015 Net income attributable to shareholders $ 22,766 $ 1,603 Weighted-average number of ordinary shares outstanding (thousands of shares) 36,404 35,579 Incremental shares arising from the assumed exercise of share options and vesting of restricted share units (thousands of shares) 926 736 Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares) 37,330 36,315 Basic earnings per ordinary share $ 0.63 $ 0.05 Diluted earnings per ordinary share $ 0.61 $ 0.04 Outstanding share options excluded in the computation of diluted earnings per ordinary share (1) — 62,304 (1) These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares. |
Cash, cash equivalents and mark
Cash, cash equivalents and marketable securities | 3 Months Ended |
Sep. 30, 2016 | |
Cash, cash equivalents and marketable securities | 4. Cash, cash equivalents and marketable securities The Company’s cash, cash equivalents, and marketable securities can be analyzed as follows: Fair Value (amount in thousands) Carrying Cost Unrealized Cash and Marketable As of September 30, 2016 Cash $ 105,675 $ — $ 105,675 $ — Cash equivalents 185 — 185 — Corporate bonds and commercial papers 116,926 235 — 117,161 U.S. agency and U.S. treasury securities 29,411 (23 ) — 29,388 Sovereign and municipal securities 1,153 — — 1,153 Total $ 253,350 $ 212 $ 105,860 $ 147,702 Fair Value (amount in thousands) Carrying Unrealized Cash and Marketable As of June 24, 2016 Cash $ 136,754 $ — $ 136,754 $ — Cash equivalents 6,050 — 6,050 — Corporate bonds and commercial papers 112,128 394 — 112,522 U.S. agency and U.S. treasury securities 28,028 2 — 28,030 Sovereign and municipal securities 1,154 3 — 1,157 Total $ 284,114 $ 399 $ 142,804 $ 141,709 All highly liquid investments with original maturities of three months or less at the date of purchase are classified as cash equivalents. Management determines the appropriate classification of its investments at the time of purchase and reevaluates the designations at each balance sheet date. The Company may sell certain of its marketable securities prior to their stated maturities for strategic reasons including, but not limited to, anticipation of credit deterioration and duration management. The maturities of the Company’s marketable securities generally range from three months to three years. The Company’s investments in marketable securities consist of investments in U.S. Treasuries and fixed income securities and have been classified and accounted for as available-for-sale. The following table summarizes the cost and estimated fair value of marketable securities classified as available-for-sale securities based on stated effective maturities as of September 30, 2016: (amount in thousands) Carrying Cost Fair Value Due within one year $ 16,828 $ 16,830 Due between one to three years 130,662 130,872 Total $ 147,490 $ 147,702 During the three months ended September 30, 2016, the Company recognized a realized loss of $0.1 million from sales and maturities of available-for-sale securities. As of September 30, 2016, the Company considered the declines in market value of its marketable securities investment portfolio to be temporary in nature and did not consider any of its securities other-than-temporarily impaired. The Company typically invests in highly-rated securities, and its investment policy generally limits the amount of credit exposure to any one issuer. The policy requires investments generally to be investment grade, with the primary objective of minimizing the potential risk of principal loss. Fair values were determined for each individual security in the investment portfolio. When evaluating an investment for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below its cost basis, the financial condition of the issuer and any changes thereto, changes in market interest rates, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s cost basis. No impairment losses were recorded for the three months ended September 30, 2016. As of September 30, 2016, cash, cash equivalents, and marketable securities included bank deposits of $40.0 million held in various financial institutions located in the United States in order to support the availability of the Facility Agreement (as defined in Note 11) and comply with covenants. As discussed in Note 11, under the terms and conditions of the Facility Agreement, the Company shall maintain cash, cash equivalents and/or marketable securities in an aggregate amount not less than $40.0 million in unencumbered deposits, and/or securities in accounts located in the United States at all times during the term of the Facility Agreement. The Company must comply with the covenant from and after the effective date of the Facility Agreement. |
Fair value of financial instrum
Fair value of financial instruments | 3 Months Ended |
Sep. 30, 2016 | |
Fair value of financial instruments | 5. Fair value of financial instruments Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy is established which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs for the valuation of an asset or liability as of measurement date. The three levels of inputs that may be used to measure fair value are defined as follows: Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for assets or liabilities, either directly or indirectly. If the assets or liabilities have a specified (contractual) term, Level 2 inputs must be observable for substantially the full term of assets or liabilities. Level 3 inputs are unobservable inputs for assets or liabilities, which require the reporting entity to develop its own valuation techniques and assumptions. The Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The following table provides details of the financial instruments measured at fair value on a recurring basis, including: Fair Value Measurements at Reporting Date Using (amount in thousands) Level 1 Level 2 Level 3 Total As of September 30, 2016 Assets Cash equivalents $ — $ 185 $ — $ 185 Corporate bonds and commercial papers — 117,161 — 117,161 U.S. agency and U.S. treasury securities — 29,388 — 29,388 Sovereign and municipal securities — 1,153 — 1,153 Total $ — $ 147,887 $ — $ 147,887 Liabilities Derivative liabilities $ — $ 49 (1) $ — $ 49 Total $ — $ 49 $ — $ 49 Fair Value Measurements at Reporting Date Using (amount in thousands) Level 1 Level 2 Level 3 Total As of June 24, 2016 Assets Cash equivalents $ — $ 6,050 $ — $ 6,050 Corporate bonds and commercial papers — 112,522 — 112,522 U.S. agency and U.S. treasury securities — 28,030 — 28,030 Sovereign and municipal securities — 1,157 — 1,157 Derivative assets — 158 (2) — 158 Total $ — $ 147,917 $ — $ 147,917 Liabilities Derivative liabilities $ — $ 1,754 (3) $ — $ 1,754 Total $ — $ 1,754 $ — $ 1,754 (1) Foreign currency forward contracts with notional amount of $42.5 million and Canadian dollars 0.4 million. (2) Foreign currency forward contracts with notional amount of $7.0 million. (3) Foreign currency forward contracts with notional amount of $77.5 million and Canadian dollars 0.6 million. Derivative Financial Instruments As a result of foreign currency rate fluctuations, the U.S. dollar equivalent values of the Company’s foreign currency denominated assets and liabilities change. The Company uses foreign currency contracts to manage the foreign exchange risk associated with certain foreign currency denominated assets and liabilities and other foreign currency transactions. The Company minimizes the credit risk in derivative instruments by limiting its exposure to any single counterparty and by entering into derivative instruments only with counterparties that meet the Company’s minimum credit quality standard. As of September 30, 2016, the Company recognized the fair value of foreign currency forward contracts of $0.05 million as derivative liabilities in the unaudited condensed consolidated balance sheet. As of June 24, 2016, the Company recognized the fair value of foreign currency forward contracts of $0.2 million as derivative assets and $1.7 million as derivative liabilities in the unaudited condensed consolidated balance sheets. As of September 30, 2016, the Company had no foreign currency forward contract, designated as cash flow hedges. During the three months ended September 30, 2016, the Company discontinued cash flow hedges and recognized a gain from unwinding these forward contracts of $0.3 million in the unaudited condensed consolidated statements of operations and comprehensive income. A gain of $0.01 million in AOCI for the three months ended September 30, 2016 is expected to be reclassified into the earnings within the next 12 months. As of September 30, 2016, the Company had nine outstanding foreign currency forward contracts with notional amount of $42.5 million and Canadian dollars 0.4 million, maturing during October to December 2016. These foreign currency forward contracts were not designated for hedge accounting and were used to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht and Canadian dollar. During the three months ended September 30, 2016, the Company included unrealized loss of $0.05 million from changes in the fair value of foreign currency contracts in earnings in the unaudited condensed consolidated statements of operations and comprehensive income. As of September 25, 2015, the Company had 42 outstanding foreign currency options with notional amount of $11.0 million and forward contracts with notional amount of $169.5 million, Canadian dollars 1.0 million and Japanese yen of 0.1 million, maturing during September 2015 to December 2016. These foreign currency forward contracts and options were not designated for hedge accounting and were used to hedge fluctuations in the U.S. dollar value of forecasted transactions denominated in Thai baht and Canadian dollar. During the three months ended September 25, 2015, the Company included unrealized gain of $12.1 million from changes in the fair value of foreign currency contracts in earnings in the unaudited condensed consolidated statements of operations and comprehensive income. |
Trade accounts receivable, net
Trade accounts receivable, net | 3 Months Ended |
Sep. 30, 2016 | |
Trade accounts receivable, net | 6. Trade accounts receivable, net (amount in thousands) As of September 30, 2016 As of June 24, 2016 Trade accounts receivable $ 212,774 $ 196,178 Less: Allowance for doubtful account (90 ) (33 ) Trade accounts receivable, net $ 212,684 $ 196,145 As of September 30, 2016, trade accounts receivable of $1.7 million were secured to short-term loans from bank (see Note 11). |
Inventory
Inventory | 3 Months Ended |
Sep. 30, 2016 | |
Inventory | 7. Inventory (amount in thousands) As of September 30, 2016 As of June 24, 2016 Raw materials $ 66,759 $ 58,199 Work in progress 106,702 94,762 Finished goods 23,007 21,593 Goods in transit 12,491 9,381 208,959 183,935 Less: Inventory obsolescence (3,475 ) (2,436 ) Inventory, net $ 205,484 $ 181,499 |
Business acquisition
Business acquisition | 3 Months Ended |
Sep. 30, 2016 | |
Business acquisition | 8. Business acquisition On September 14, 2016, the Company acquired 100% of the shares of Exception EMS, a privately-held group located in Wiltshire, United Kingdom, for cash consideration of approximately $13.0 million, net of $0.5 million cash acquired. Exception EMS provides contract electronics manufacturing services to the global electronics industry with innovative solutions, adding value to the design, manufacture and testing of printed circuit board assemblies. Pursuant to the acquisition agreement, the Company has placed $3.4 million of cash for deferred consideration in an escrow account which is under the Company controls. However, the Company has contractually agreed to remit this deferred consideration to the sellers of Exception EMS, subject to the resolution of claims that the Company may make against the funds with respect to indemnification and other claims, within 24 months from the closing date of the transaction. The Company has concluded it is the accounting acquirer for in the transaction and accounted for the acquisition under the provisions of business combinations accounting, in accordance with Accounting Standards Codification Topic 805 – Business Combinations. Accordingly, the estimated fair value of the acquisition consideration was allocated to the assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. The Company has made certain estimates and assumptions in determining the allocation of the acquisition consideration. The total consideration and the allocation of consideration to the individual Exception EMS net assets is preliminary, as there are remaining uncertainties to be resolved, including the settlement of the final net working capital adjustment and the finalization of the estimated fair value attributable to the acquired intangible assets. As the functional currency of Exception EMS is Pound sterling, as of September 30, 2016, the Company recognized $0.7 million of foreign exchange currency translation adjustment in its unaudited condensed consolidated statements of operations and comprehensive income. The Company’s preliminary allocation of the total purchase price for the acquisition is summarized below: (amount in thousands) Purchase price Cash $ 474 Accounts receivable 4,698 Inventory 2,633 Other current assets 425 Property, plant and equipment 5,660 Intangibles 4,472 Goodwill 2,994 Other non-current assets 509 Current liabilities (6,792 ) Other non-current liabilities (1,556 ) Total fair value of assets acquired and liabilities assumed $ 13,517 Total purchase price, net of cash acquired $ 13,043 In connection with the Company’s acquisition of Exception EMS, the Company assumed lease agreements for certain machine and equipment, which are accounted for as capital leases. As of September 30, 2016, the Company included approximately $2.2 million of capital lease assets and $1.7 million of capital lease liability in the unaudited condensed consolidated balance sheets associated with these acquired lease agreements. During the three months ended September 30, 2016, the Company incurred approximately $1.1 million, in transaction costs related to the acquisition, which primarily consisted of legal, accounting and valuation-related expenses. These expenses were recorded in selling, general and administrative expense in the accompanying unaudited condensed consolidated statements of operations and comprehensive income. Pro forma results of operations for the acquisition have not been presented as they were not material to the Company’s results of operations. Identifiable intangibles The acquired intangible assets include customer relationships and backlog. The fair value of the identified intangible assets was determined based on the multi-period excess earnings method. Customer relationships represent the fair value of future projected revenues that was derived from the sale of products to existing customers of the acquired company. The fair value $4.4 million of customer relationships will be amortized over the respective estimated remaining useful life of ten years. Backlog represents the fair value of sales orders backlog as of the valuation date. The fair value $0.1 million of backlog will be amortized over the respective estimated remaining useful life of three years. Goodwill Goodwill arising from the acquisition is primarily attributable to the ability to expand future products and services and the assembled workforce. Goodwill is not deductible for tax purposes. |
Intangibles
Intangibles | 3 Months Ended |
Sep. 30, 2016 | |
Intangibles | 9. Intangibles The following tables present details of the Company’s intangibles: (amount in thousands) Gross Carrying Accumulated Net As of September 30, 2016 Software $ 3,915 $ (3,296 ) $ 619 Customer relationships 4,372 — 4,372 Backlog 100 — 100 Total intangibles $ 8,387 $ (3,296 ) $ 5,091 (amount in thousands) Gross Carrying Accumulated Net As of June 24, 2016 Software $ 3,786 $ (3,287 ) $ 499 Customer relationships — — — Backlog — — — Total intangibles $ 3,786 $ (3,287 ) $ 499 In connection with the acquisition of Exception EMS, the Company recorded $4.4 million of customer relationships and $0.1 million of backlog with the weighted-average life of 7.6 years and 2.3 years, respectively. The Company recorded amortization expense relating to intangibles of $0.03 million and $0.01 million for the three months ended September 30, 2016 and September 25, 2015, respectively. Based on the carrying amount of intangibles as of September 30, 2016, and assuming no future impairment of the underlying assets, the estimated future amortization during each fiscal year was as follows: (amount in thousands) 2017 (remaining nine months) $ 461 2018 614 2019 614 2020 585 2021 517 Thereafter 2,300 Total $ 5,091 |
Goodwill
Goodwill | 3 Months Ended |
Sep. 30, 2016 | |
Goodwill | 10. Goodwill In connection with the acquisition of Exception EMS, the Company recorded $3.0 million of goodwill in the unaudited condensed consolidated balance sheets. The changes in the carrying amount of goodwill were as follows; (amount in thousands) Goodwill Balance as of June 24, 2016 $ — Addition in connection with business acquisition 2,994 Balance as of September 30, 2016 $ 2,994 Goodwill is not deductible for tax purposes. Goodwill will not be amortized but is reviewed annually for impairment or more frequently whenever changes or circumstances indicate the carrying amount of goodwill may not be recoverable. |
Borrowings
Borrowings | 3 Months Ended |
Sep. 30, 2016 | |
Borrowings | 11. Borrowings The Company’s total borrowings, including short-term and long-term borrowings, consisted of the following: (amount in thousands) Rate (1) Conditions Maturity As of September 30, 2016 As of June 24, 2016 Short-term borrowing: Revolving borrowing: LIBOR + 1.75% per annum Repayable in 1 to 6 months October 2016 (2) $ 20,000 $ 6,500 Short-term loans from bank: Bank Base rate +1.85% per annum Repayable based on 1,182 — Current portion of long-term borrowing 16,600 18,100 37,782 24,600 Less: Unamortized debt issuance costs (266 ) (293 ) $ 37,516 $ 24,307 Long-term borrowing: LIBOR + 2.8% per annum Repayable in March 2017 $ 3,000 $ 4,500 Term loan borrowing: LIBOR +1.75% per annum Repayable in May 2019 46,600 50,000 49,600 54,500 Less: Current portion (16,600 ) (18,100 ) Unamortized debt issuance costs (241 ) (300 ) Non-current portion $ 32,759 $ 36,100 (1) LIBOR is London Interbank Offered Rate. (2) In October 2016, the maturity date was extended to November 2016. Under the long-term borrowing contract of a subsidiary, the loan is secured by certain property, plant and equipment of the subsidiary. The carrying amount of assets secured and pledged as collateral to such loan as of September 30, 2016 and June 24, 2016 was $47.0 million and $47.7 million, respectively. This subsidiary is also required to comply with maximum ratios of debt to equity and minimum levels of debt service coverage ratios, and Fabrinet must maintain an effective shareholding ratio. The carrying amounts of bank borrowings approximate their fair value. As of September 30, 2016 and June 24, 2016, the Company was in compliance with its bank borrowing agreements. In addition to financial ratios, certain of the Company’s credit facilities include customary events of default. The movements of long-term loans were as follows for the three months ended September 30, 2016 and September 25, 2015: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Opening balance $ 54,500 $ 10,500 Repayments during the period (4,900 ) (1,500 ) Closing balance $ 49,600 $ 9,000 As of September 30, 2016, future maturities of long-term debt during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 13,200 2018 13,600 2019 22,800 Total $ 49,600 Credit facilities: Fabrinet entered into a syndicated senior credit facility agreement (the “Facility Agreement”) with a consortium of banks on May 22, 2014. The Facility Agreement, led by Bank of America, provides for a $200.0 million credit line, comprised of a $150.0 million revolving loan facility and a $50.0 million delayed draw term loan facility. The revolving loan facility contains an accordion feature permitting Fabrinet to request an increase in the facility up to $100.0 million subject to customary terms and conditions and provided that no default or event of default exists at the time of request. The revolving loan facility terminates and all amounts outstanding are due and payable in full on May 22, 2019. The principal amount of any drawn term loans must be repaid according to scheduled quarterly amortization payments, with final payment of all amounts outstanding, plus accrued interest, being due May 22, 2019. On February 26, 2015, the Company entered into the Second Amendment to the Facility Agreement. The amendment extended the availability period for draws on the term loan facility from May 21, 2015 to July 31, 2015. It also allowed the Company, upon the satisfaction of certain conditions, to designate from time to time one or more of its subsidiaries as borrowers under the Facility Agreement. On July 31, 2015, the Company entered into the Third Amendment to the Facility Agreement. The amendment extended the availability period for draws on the term loan facility from July 31, 2015 to July 31, 2016. As of September 30, 2016, there were $20.0 million of the revolving borrowing and $46.6 million of the term loan borrowing outstanding under the Facility Agreement, resulting in available credit facilities of $133.4 million. Borrowings under the revolving credit facility are classified as current liabilities in the unaudited condensed consolidated balance sheets as the Company has the periodic option to renew or pay, all or a portion of, the outstanding balance at the end of the maturity date, which is in the range of one to six months, without premium or penalty, upon notice to the administrative agent. During October 2016, the Company sent notices to the bank to renew the maturity date of its revolving borrowings. The bank approved the notices and extended the maturity to November 2016. Loans under the Facility Agreement bear interest, at Fabrinet’s option, at a rate per annum equal to a LIBOR rate plus a spread of 1.75% to 2.50%, or a base rate plus a spread of 0.75% to 1.50%, determined in accordance with the Facility Agreement in each case with such spread determined based on Fabrinet’s consolidated total leverage ratio for the preceding four fiscal quarter period. Interest is due and payable quarterly in arrears for loans bearing interest at the base rate and at the end of an interest period (or at each three-month interval in the case of loans with interest periods greater than three months) in the case of loans bearing interest at the LIBOR rate. Fabrinet’s obligations under the Facility Agreement are guaranteed by certain of its existing and future direct material subsidiaries. In addition, the Facility Agreement is secured by Fabrinet’s present and future accounts receivable, deposit accounts and cash, and a pledge of the capital stock of certain of Fabrinet’s direct subsidiaries. Fabrinet is required to maintain at least $40.0 million of cash, cash equivalents, and marketable securities at financial institutions located in the United States. Further, Fabrinet is required to maintain any of its deposits accounts or securities accounts with balances in excess of $10.0 million in a jurisdiction where a control agreement, or the equivalent under the local law, can be effected. The Facility Agreement contains customary affirmative and negative covenants. Negative covenants include, among other things, limitations on liens, indebtedness, investments, mergers, sales of assets, changes in the nature of the business, dividends and distributions, affiliate transactions and capital expenditures. The Facility Agreement contains financial covenants requiring Fabrinet to maintain: (1) a minimum tangible net worth of not less than $200.0 million plus 50% of quarterly net income, exclusive of quarterly losses; (2) a minimum debt service coverage ratio of not less than 1.50:1.00; (3) a maximum senior leverage ratio of not more than 2.50:1.00; and (4) a minimum quick ratio of not less than 1.10:1.00. Each of these financial covenants is calculated on a consolidated basis for the consecutive four fiscal quarter period then ended. As of September 30, 2016, the Company was in compliance with all covenants under the Facility Agreement. The Facility Agreement also contains customary events of default including, among other things, payment defaults, breaches of covenants or representations and warranties, cross-defaults with certain other indebtedness, bankruptcy and insolvency events and change in control of Fabrinet, subject to grace periods in certain instances. Upon an event of default, the lenders may terminate their commitments, declare all or a portion of the outstanding obligations payable by Fabrinet to be immediately due and payable and exercise other rights and remedies provided for under the Facility Agreement. Fabrinet intends to use the proceeds of the credit line to finance its future manufacturing buildings in the United States and Thailand, and for general corporate purposes including mergers and acquisitions of complementary manufacturing businesses or technology, although Fabrinet has no current commitments with respect to any such acquisitions. Short-term loans from bank In connection with the business acquisition, the Company assumed a secured borrowing agreement. The loans are secured by trade accounts receivable and the way of chattels mortgage over the plant and machine of Exception EMS. As of September 30, 2016, the carrying amount of trade accounts receivable and plant and machine secured to such loans were $5.5 million and $4.9 million, respectively The secured borrowing agreement contains certain covenants that the Company is required to comply with: (1) the value of credit notes may not exceed 4% of the value of assigned debts measured on a monthly basis, and (2) rolling cash flow must be provided with monthly management information. As of September 30, 2016, the Company was in compliance with all covenants under the secured borrowing agreement. As of September 30, 2016, the Company drew down from this facility of $1.2 million which is recorded as short-term loans in the unaudited condensed consolidated balance sheets. The agreement bears interest for discount charge at 1.85% per annum above based rate. Undrawn available credit facilities classified by availability period of future borrowing as of September 30, 2016 and June 24, 2016 were as follows: (amount in thousands) September 30, 2016 June 24, 2016 Short-term $ 2,999 $ 1,414 Long-term $ 133,400 $ 143,500 |
Income taxes
Income taxes | 3 Months Ended |
Sep. 30, 2016 | |
Income taxes | 12. Income taxes As of September 30, 2016 and June 24, 2016, the liability for uncertain tax positions including accrued interest and penalties was $1.9 million and $1.8 million, respectively. The Company expects the estimated amount of liability associated with its uncertain tax positions to decrease within the next 12 months due to the lapse of the applicable statute of limitations in foreign tax jurisdictions. The Company files income tax returns in the United States and foreign tax jurisdictions. The tax years from 2012 to 2016 remain open to examination by U.S. federal and state tax authorities, and foreign tax authorities. The Company’s income tax is recognized based on the best estimate of the expected annual effective tax rate for the full financial year of each entity in the Company, adjusted for discrete items arising in that quarter. If the Company’s estimated annual effective tax rate changes, the Company makes a cumulative adjustment in that quarter. The effective tax rate for the Company for the three months ended September 30, 2016 and September 25, 2015 remained flat at 6.7% of net income. The Company’s taxable income and income tax expenses for the three months ended September 30, 2016 increased proportionately on an absolute dollars basis, compared with the three months ended September 25, 2015. |
Share-based compensation
Share-based compensation | 3 Months Ended |
Sep. 30, 2016 | |
Share-based compensation | 13. Share-based compensation Share-based compensation In determining the grant date fair value of equity awards, the Company is required to make estimates of the fair value of Fabrinet’s ordinary shares, expected dividends to be issued, expected volatility of Fabrinet’s ordinary shares, expected forfeitures of the awards, risk free interest rates for the expected term of the awards, expected terms of the awards, and the vesting period of the respective awards. Forfeitures are estimated at the time of grant and revised if necessary in subsequent periods if actual forfeitures differ from those estimates. The effect of recording share-based compensation expense for the three months ended September 30, 2016 and September 25, 2015 was as follows: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Share-based compensation expense by type of award: Share options $ — $ 16 Restricted share units 4,820 2,657 Performance share units 791 — Total share-based compensation expense 5,611 2,673 Tax effect on share-based compensation expense — — Net effect on share-based compensation expense $ 5,611 $ 2,673 Share-based compensation expense was recorded in the unaudited condensed consolidated statements of operations and comprehensive income as follows: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Cost of revenue $ 1,014 $ 537 Selling, general and administrative expense 4,597 2,136 Total share-based compensation expense $ 5,611 $ 2,673 The Company did not capitalize any share-based compensation expense as part of any asset costs during the three months ended September 30, 2016 and September 25, 2015. Share-based award activity Share options have been granted to directors and employees. As of September 30, 2016, there were 5 share options outstanding under Fabrinet’s Amended and Restated 1999 Share Option Plan (the “1999 Plan”). Additional option grants may not be made under the 1999 Plan. As of September 30, 2016, there were an aggregate of 306,012 share options outstanding, 1,321,464 restricted share units outstanding and 234,678 performance share units outstanding under Fabrinet’s 2010 Performance Incentive Plan (the “2010 Plan”). As of September 30, 2016, there were 1,404,646 ordinary shares available for future grant under the 2010 Plan. The 1999 Plan and 2010 Plan are collectively referred to as the “Share Option Plans.” Share options Fabrinet’s board of directors has the authority to determine the type of option and the number of shares subject to an option. Options generally vest and become exercisable over four years and expire, if not exercised, within seven years of the grant date. In the case of a grantee’s first grant, 25 percent of the underlying shares vest 12 months after the vesting commencement date and 1/48 of the underlying shares vest monthly over each of the subsequent 36 months. In the case of any additional grants to a grantee, 1/48 of the underlying shares vest monthly over four years, commencing one month after the vesting commencement date. The following summarizes share option activity: Number of Shares Number of Weighted- Per Share Weighted- Per Share Balance as of June 24, 2016 464,334 464,334 $ 15.95 Granted — — — Exercised (158,317 ) $ 17.10 Forfeited — — Expired — — Balance as of September 30, 2016 306,017 306,017 $ 15.36 Number of Shares Number of Weighted- Per Share Weighted- Per Share Balance as of June 26, 2015 792,019 758,451 $ 16.33 Granted — — — Exercised (98,759 ) $ 15.67 Forfeited (213 ) $ 14.43 Expired — — Balance as of September 25, 2015 693,047 680,798 $ 16.42 The following summarizes information for share options outstanding as of September 30, 2016 under the Share Option Plans: Range of Number of Weighted- Aggregate (amount in thousands) $5.75 – $15.05 185,092 1.94 $15.16 – $16.83 112,375 1.09 $18.60 – $26.16 8,550 2.02 Options outstanding 306,017 1.63 $ 8,945 Options exercisable 306,017 1.63 $ 8,945 As of September 30, 2016, there was no unrecognized compensation cost under the Share Option Plan. Restricted share units and performance share units Restricted share units and performance share units are types of share-based awards that may be granted under the 2010 Plan. Restricted share units granted to non-employee directors generally cliff vest 100% on the first of January, approximately one year from the grant date, provided the director continues to serve through such date. Restricted share units granted to employees generally vest in equal installments over three or four years on each anniversary of the vesting commencement date. Performance share units granted to executives will vest at the end of a two-year performance period based on the Company’s achievement of pre-defined performance criteria, which consist of revenue and gross margin targets. The actual number of performance share units that may vest at the end of the performance period ranges from 0% to 100% of the award grant. The Company has entered into an employment agreement, as amended on August 12, 2016, with an executive of the Company that provides for accelerated vesting of equity awards under certain circumstances, including upon termination of employment. In addition, if the executive’s employment with the Company continues through and including February 20, 2017, (1) any outstanding equity awards granted to the executive prior to August 2016 will become 100% vested and (2) certain restricted share units granted to the executive in August 2016 will become 100% vested. The following summarizes restricted share unit activity under the 2010 Plan: Number of Shares Weighted- Per Share Balance as of June 24, 2016 1,181,402 $ 18.34 Granted 568,283 $ 39.53 Issued (408,874 ) (1) $ 16.23 Forfeited (19,347 ) $ 19.12 Balance as of September 30, 2016 1,321,464 $ 28.10 Number of Shares Weighted- Per Share Balance as of June 26, 2015 1,140,927 $ 16.02 Granted 499,896 $ 19.34 Issued (286,374 ) $ 14.69 Forfeited (6,587 ) $ 18.11 Balance as of September 26, 2015 1,347,862 $ 17.09 (1) Includes 875 shares vested on September 30, 2016, but not settled. The following summarizes performance share unit activity under the 2010 Plan: Number of Shares Weighted- Per Share Balance as of June 24, 2016 — — Granted 234,678 $ 40.48 Issued — — Forfeited — — Balance as of September 30, 2016 234,678 $ 40.48 As of September 30, 2016, there was $35.3 million of unrecognized share-based compensation expense related to restricted share units under the 2010 Plan that is expected to be recorded over a weighted-average period of 2.77 years. For the three months ended September 30, 2016 and September 25, 2015, the Company withheld an aggregate of 22,294 shares and 46,016 shares, respectively, upon the vesting of restricted share units, based upon the closing share price on the vesting date to settle the employees’ minimum statutory obligation for the applicable income and other employment taxes. For the three months ended September 30, 2016 and September 25 2015, the Company then remitted cash of $0.9 million and $0.9 million, respectively, to the appropriate taxing authorities, and presented it in a financing activity within the unaudited condensed consolidated statements of cash flows. The payment had the effect on shares issued by the Company as it reduced the number of shares that would have been issued on the vesting date and was recorded as a reduction of additional paid-in capital. |
Shareholders' equity
Shareholders' equity | 3 Months Ended |
Sep. 30, 2016 | |
Shareholders' equity | 14. Shareholders’ equity Share capital Fabrinet’s authorized share capital is 500,000,000 ordinary shares, par value of $0.01 per ordinary share, and 5,000,000 preferred shares, par value of $0.01 per preferred share. For the three months ended September 30, 2016, Fabrinet issued 158,317 ordinary shares upon the exercise of options, for cash consideration at a weighted-average exercise price of $17.10 per share, and 385,705 ordinary shares upon the vesting of restricted share units, net of shares withheld. All such issued shares are fully paid. |
Accumulated other comprehensive
Accumulated other comprehensive income | 3 Months Ended |
Sep. 30, 2016 | |
Accumulated other comprehensive income | 15. Accumulated other comprehensive income The changes in AOCI for the three months ended September 30, 2016 were as follows: (amount in thousands) Unrealized net Gains (Losses) on Marketable Securities Unrealized net Gains (Losses) on Derivative Instruments Foreign Total Balance as of June 24, 2016 $ 399 $ 192 $ — $ 591 Other comprehensive income before reclassification adjustment (87 ) — 741 654 Amounts reclassified out of AOCI to foreign exchange loss in the unaudited condensed consolidated statement of operations and comprehensive income (100 ) (158 ) — (258 ) Tax effects — — — — Other comprehensive loss $ (187 ) $ (158 ) 741 $ 396 Balance as of September 30, 2016 $ 212 $ 34 $ 741 $ 987 |
Commitments and contingencies
Commitments and contingencies | 3 Months Ended |
Sep. 30, 2016 | |
Commitments and contingencies | 16. Commitments and contingencies Bank guarantees As of September 30, 2016 and June 24, 2016, there were outstanding bank guarantees given by banks on behalf of Fabrinet Thailand for electricity usage and other normal business amounting to $0.8 million and $0.8 million, respectively. Operating lease commitments The Company leases a portion of its office, capital equipment, and certain land and buildings for its facilities in the Cayman Islands, China, New Jersey and the United Kingdom under operating lease arrangements that expire in various calendar years through 2023. Rental expense under these operating leases amounted to $0.4 million and $0.3 million for the three months ended September 30, 2016 and September 25, 2015, respectively. As of September 30, 2016, the future minimum lease payments due under non-cancelable operating leases during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 1,338 2018 1,685 2019 1,131 2020 922 2021 525 Thereafter 897 Total minimum operating lease payments $ 6,498 Capital lease commitments In connection with the acquisition of Exception EMS, the Company assumed the capital lease commitments of certain machine and equipment, with various expiration dates until September 2020. The equipment can be purchased at the determined price upon expiration. As of September 30, 2016, the future minimum lease payments due under non-cancelable capital leases during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 301 2018 416 2019 429 2020 376 2021 156 Total minimum capital lease payments $ 1,678 Purchase obligations Purchase obligations represent legally-binding commitments to purchase inventory and other commitments made in the normal course of business to meet operational requirements. Although open purchase orders are considered enforceable and legally binding, their terms generally give the Company the option to cancel, reschedule and/or adjust its requirements based on its business needs prior to the delivery of goods or performance of services. Obligations to purchase inventory and other commitments are generally expected to be fulfilled within one year. As of September 30, 2016, the Company had an outstanding commitment to third parties of approximately $30.1 million, mainly related to the construction of a new manufacturing building at the Company’s Chonburi campus. Indemnification of directors and officers Cayman Islands law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification of directors and officers, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Fabrinet’s amended and restated memorandum and articles of association provide for indemnification of directors and officers for actions, costs, charges, losses, damages and expenses incurred in their capacities as such, except that such indemnification does not extend to any matter in respect of any fraud or dishonesty that may attach to any of them. In accordance with Fabrinet’s form of indemnification agreement for its directors and officers, Fabrinet has agreed to indemnify its directors and officers against certain liabilities and expenses incurred by such persons in connection with claims by reason of their being such a director or officer. Fabrinet maintains a director and officer liability insurance policy that may enable it to recover a portion of any future amounts paid under the indemnification agreements. |
Business segments and geographi
Business segments and geographic information | 3 Months Ended |
Sep. 30, 2016 | |
Business segments and geographic information | 17. Business segments and geographic information Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is Fabrinet’s chief executive officer. As of September 30, 2016, the Company operated and internally managed a single operating segment. Accordingly, the Company does not accumulate discrete information with respect to separate product lines and does not have separate reportable segments. Total revenues are attributed to a particular geographic area based on the bill-to-location of the customers. The Company operates primarily in three geographic regions: North America, Asia-Pacific and Europe. The following table presents total revenues by geographic regions: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 North America $ 165,995 $ 106,443 Asia-Pacific 114,745 83,890 Europe 51,303 26,100 $ 332,043 $ 216,433 As of September 30, 2016 and September 25, 2015, the Company had approximately $36.4 million and $33.9 million of long-lived assets based in North America, with the substantial remainder of assets based in Asia-Pacific and Europe. Significant customers The Company had one and two customers that each contributed to 10% or more of its total account receivable as of September 30, 2016 and June 24, 2016, respectively. |
Other expense related to floodi
Other expense related to flooding | 3 Months Ended |
Sep. 30, 2016 | |
Other expense related to flooding | 18. Other expense related to flooding During the week of August 10, 2015, the Company’s subsidiary in China temporarily suspended production in its manufacturing facility due to flooding caused by Typhoon Soudelor and resumed operations on August 15, 2015. During the three months ended September 25, 2015, the Company recognized $0.9 million of losses incurred from the event in the unaudited condensed consolidated statements of operations and comprehensive income. The Company received a final payment of $0.8 million from an insurer against the Company’s claim for flood damage during the three months ended March 25, 2016. |
Accounting policies (Policies)
Accounting policies (Policies) | 3 Months Ended |
Sep. 30, 2016 | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements for Fabrinet as of September 30, 2016 and for the three months ended September 30, 2016 and September 25, 2015 includes normal recurring adjustments, necessary for a fair presentation of the financial statements set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information, please refer to the consolidated financial statements and footnotes thereto included in Fabrinet’s Annual Report on Form 10-K for the year ended June 24, 2016. The balance sheet as of June 24, 2016 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The results for the three months ended September 30, 2016 may not be indicative of results for the year ending June 30, 2017 or any future periods. Where necessary, comparative figures have been reclassified to conform to the current period accounting policies and presentation adopted. On September 14, 2016, the Company acquired 100% of the shares of Global CEM Solutions, Ltd. and all of its subsidiaries, a privately-held group located in Wiltshire, United Kingdom (“Exception EMS”). The unaudited condensed consolidated financial statements of the Company include the financial position, results of operations and the cash flows of Exception EMS commencing as of the acquisition date. See Note 8 - Business acquisitions for further details on the accounting for this transaction. |
Use of Estimates | Use of Estimates The preparation of the Company’s condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements, and the reported amount of total revenues and expenses during the year. The Company bases estimates on historical experience and various assumptions about the future that are believed to be reasonable based on available information. The Company’s reported financial position or results of operations may be materially different under different conditions or when using different estimates and assumptions, particularly with respect to significant accounting policies, which are discussed below. Significant assumptions are used in accounting for share-based compensation, allowance for doubtful accounts, income taxes, inventory obsolescence and valuation of intangible assets related to business acquisition, among others. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be different from these estimates. In the event that estimates or assumptions prove to differ from actual results, adjustments will be made in subsequent periods to reflect more current information. |
Fiscal years | Fiscal years The Company utilizes a 52-53 week fiscal year ending on the Friday in June closest to June 30. The three months ended September 30, 2016 and September 25, 2015 each consisted of 14 weeks and 13 weeks, respectively. Fiscal year 2017 will be comprised of 53 weeks and will end on June 30, 2017. |
Concentration of credit risk | Concentration of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, marketable securities, derivatives, and accounts receivable. Cash, cash equivalents, and marketable securities are maintained with several financial institutions. Deposits held with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and are maintained with financial institutions with reputable credit and therefore bear minimal credit risk. The Company seeks to mitigate its credit risks by spreading such risks across multiple counterparties and monitoring the risk profiles of these counterparties. The Company limits its investments in marketable securities to securities with a maturity not in excess of three years, and all marketable securities that the Company invests in are rated A1, P-1, F1, or better. The Company performs ongoing credit evaluations for credit worthiness of its customers and usually does not require collateral from its customers. Management has implemented a program to closely monitor near term cash collection and credit exposures to mitigate any material losses. |
Derivatives | Derivatives The derivatives assets and liabilities are recognized on the consolidated balance sheets as other current assets or accrued expenses measured at fair value. The Company applies hedge accounting to arrangements that qualify and are designated for cash flow hedge accounting treatment. Hedge accounting is discontinued prospectively if the hedging relationship ceases to be effective or the hedging or hedged items cease to exist as a result of maturity, sale, termination or cancellation. Derivatives designated and qualifying as hedges of the exposure to variability in expected future cash flows, or other types of forecasted transactions, are considered cash flow hedges which include forward currency contracts. In a cash flow hedging relationship, the effective portion of the change in the fair value of the hedging derivative is initially recorded in accumulated other comprehensive income (loss) (“AOCI”), while any ineffective portion is recognized directly in earnings, as a component of other income (expense). The portion of gain or loss on the derivative instrument remains in AOCI until the forecasted transaction is recognized in earnings. The Company also enters into derivative contracts that are intended to economically hedge certain of the Company’s risks. The changes in the fair value of the derivatives are recorded directly in earnings as a component of other income (expense), net. In accordance with the fair value measurement guidance, the Company’s accounting policy is to measure the credit risk of its derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. The Company executes derivative instruments with financial institutions that are credit-worthy, defined as institutions that hold an investment grade credit rating. |
Business acquisition | Business acquisition For the acquisition of Exception EMS, the Company allocated the fair value of purchase consideration to the assets acquired and liability assumed based on their fair values at the acquisition date. The total consideration and the allocation of consideration to the individual net assets is preliminary, as there are remaining uncertainties to be resolved, including the settlement of the final net working capital adjustment and the finalization of the estimated fair value attributable to the acquired intangible assets. The acquired intangible assets include customer relationships and backlog and are recorded as intangibles in the unaudited condensed consolidated balance sheets. The fair value of the acquired intangible assets was determined based on the multi-period excess earnings method. The Company reviews intangibles for impairment annually or whenever changes or circumstances indicate the carrying amount may not be recoverable. In connection with the business acquisition, $3.4 million of cash for deferred consideration was placed into an escrow account which is under the Company controls. However, the Company has contractually agreed to remit this deferred consideration to the sellers of Exception EMS, subject to the resolution of claims that the Company may make against the funds with respect to indemnification and other claims within 24 months from the closing date of the transaction. The cash is presented as restricted cash in the unaudited condensed consolidated balance sheets and the related liability is presented within non-current liabilities for the deferred consideration. |
Goodwill | Goodwill Goodwill arising from the acquisition is primarily attributable to the ability to expand future products and services and the assembled workforce. Goodwill is reviewed annually for impairment or more frequently whenever changes or circumstances indicate the carrying amount of goodwill may not be recoverable. |
Capital lease | Capital lease Certain machine and equipment held under capital leases are classified as property, plant and equipment and amortized using the straight-line method over the terms of the lease contracts. The related obligations from the capital lease are recorded as liabilities in the unaudited condensed consolidated balance sheets. |
New Accounting Pronouncements - not yet adopted by the Company | New Accounting Pronouncements – not yet adopted by the Company In October 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-16, “Income Taxes (Topic 740) – Intra-Entity Transfers of Assets Other Than Inventory,” which eliminates the exception for an intra-entity transfer of an asset other than inventory that prohibits the recognition of current and deferred income taxes until the asset has been sold to an outside party. The entity should recognize income tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. For public entities, this update is effective for annual reporting periods beginning after December 15, 2017, including interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities as of the beginning of an annual reporting period for which financial statements have not been issued or made available for issuance. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments (a consensus of the Emerging Issues Task Force).” The amendments in this ASU provide guidance on the presentation of certain cash receipts and cash payments in the statement of cash flows in order to reduce diversity in existing practice. The amendments in ASU 2016-15 are effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” The amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” This ASU simplifies several aspects of the accounting for share-based payment award transactions, including, the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. The amendments in this update are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, for public companies. Early adoption is permitted for any entity in any interim or annual period. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-05, “Derivatives and Hedging (Topic 815),” to clarify that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument under Topic 815, does not, in and of itself, require designation of the hedging relationship, provided that all other hedge accounting criteria continue to be met. This guidance is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Lease (Topic 842).” The core principle of Topic 842 is that a lessee should recognize the lease assets and liabilities that arise from leases in the statement of financial position. For public business entities, this update is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early application is permitted. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” This new guidance requires certain equity investments to be measured at fair value, use of the exit price notion and separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The ASU on recognition and measurement will take effect for public companies for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory.” The update provides the guidance that an entity, that measured inventory by using first-in, first-out or average cost, should measure inventory at the lower of cost and net realizable value. Subsequent measurement is unchanged for inventory measured using last-in, first-out or the retail inventory method. The update is effective for fiscal years beginning after December 15, 2016, including interim periods within these fiscal years. This update should be applied prospectively with earlier application permitted as of the beginning of an interim or annual reporting date. The Company is currently evaluating the impact of the adoption of this update on its consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” The amendments require management to evaluate, for each annual and interim reporting period, an entity’s ability to continue as a going concern when relevant conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations that become due within one year after the date that the financial statements are issued (or available to be issued). This ASU is effective for annual periods and interim reporting periods beginning after December 15, 2016. The Company does not expect that the adoption of this update will have an effect on its consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606), issued as a new Topic, Accounting Standards Codification.” The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This update is effective for public companies, as amended by ASU 2015-14, for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Earlier application of this guidance is permitted, but not before the original date of December 15, 2016, which can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. Subsequently, in March 2016 and April 2016, the FASB issued ASU 2016-08 and ASU 2016-10, to clarify the implementation guidance on principle versus agent considerations and address the potential diversity in practice at initial application and cost; and the complexity of applying Topic 606, both at transition and on an ongoing basis related to identification of performance obligations and licensing arrangements; and ASU 2016-12, in May 2016, to improve in certain aspects of Topic 606, with the same effective date as ASU 2015-14. The Company will adopt this standard during its fiscal year ending June 28, 2018. In the current period, the Company is assessing the contracts with its customers to identify the impact to its consolidated financial statements. The process is still ongoing and the Company expects to make significant progress in the coming quarters. |
New Accounting Pronouncements - adopted by the Company | New Accounting Pronouncements – adopted by the Company In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes,” which will require entities to present deferred tax assets (“DTAs”) and deferred tax liabilities (“DTLs”) as non-current in a classified balance sheet. The ASU simplifies the current guidance, which requires entities to separately present DTAs and DTLs as current and non-current in a classified balance sheet. The Company adopted of this update early. Accordingly, as of September 30, 2016, DTAs of $1.2 million were classified to non-current in the unaudited condensed consolidated balance sheets. The Company adopted this update on a prospective basis and did not change the presentation of the comparative period. In September 2015, the FASB issued ASU 2015-16, “Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments” which require an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The Company has adopted of this update and applied it on a prospective basis. In April 2015, the FASB issued ASU 2015-03, “Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The update requires debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability instead of being presented as an asset. Debt disclosures will include the face amount of the debt liability and the effective interest rate. The update requires retrospective application and represents a change in accounting principle. Additionally, in August 2015, the FASB issued ASU 2015-15, “Interest – Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements” to amend ASU 2015-03. The Company has adopted this amendment retrospectively. As of September 30, 2016 and June 24, 2016, debt issuance costs of $0.5 million and $0.6 million, respectively, related to a recognized debt liability are presented in the balance sheet as a direct reduction of the carrying amount of the related debts. In February 2015, the FASB issued ASU 2015-02, “Consolidation (Topic 810): Amendments to the Consolidation Analysis.” ASU No. 2015-02 amended the process that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The Company has adopted this update with no impact to the unaudited condensed consolidated financial statements. In January 2015, the FASB issued ASU 2015-01, “Income Statement – Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items.” The objective of this amendment is to reduce the complexity in accounting standards by eliminating the concept of extraordinary items from U.S. GAAP. To meet for extraordinary classification the underlying event or transaction should (a) possess a high degree of abnormality and be of a type clearly unrelated to, or only incidentally related to, the ordinary and typical activities of the entity and (b) not reasonably be expected to recur in the foreseeable future. The Company has adopted this update with no impact to the unaudited condensed consolidated financial statements. |
Earnings per ordinary share (Ta
Earnings per ordinary share (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Earnings Per Ordinary Share | Earnings per ordinary share was calculated as follows: Three Months Ended (amount in thousands except per share amounts) September 30, 2016 September 25, 2015 Net income attributable to shareholders $ 22,766 $ 1,603 Weighted-average number of ordinary shares outstanding (thousands of shares) 36,404 35,579 Incremental shares arising from the assumed exercise of share options and vesting of restricted share units (thousands of shares) 926 736 Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares) 37,330 36,315 Basic earnings per ordinary share $ 0.63 $ 0.05 Diluted earnings per ordinary share $ 0.61 $ 0.04 Outstanding share options excluded in the computation of diluted earnings per ordinary share (1) — 62,304 (1) These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares. |
Cash, cash equivalents and ma26
Cash, cash equivalents and marketable securities (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Cash, Cash Equivalents, and Marketable Securities | The Company’s cash, cash equivalents, and marketable securities can be analyzed as follows: Fair Value (amount in thousands) Carrying Cost Unrealized Cash and Marketable As of September 30, 2016 Cash $ 105,675 $ — $ 105,675 $ — Cash equivalents 185 — 185 — Corporate bonds and commercial papers 116,926 235 — 117,161 U.S. agency and U.S. treasury securities 29,411 (23 ) — 29,388 Sovereign and municipal securities 1,153 — — 1,153 Total $ 253,350 $ 212 $ 105,860 $ 147,702 Fair Value (amount in thousands) Carrying Unrealized Cash and Marketable As of June 24, 2016 Cash $ 136,754 $ — $ 136,754 $ — Cash equivalents 6,050 — 6,050 — Corporate bonds and commercial papers 112,128 394 — 112,522 U.S. agency and U.S. treasury securities 28,028 2 — 28,030 Sovereign and municipal securities 1,154 3 — 1,157 Total $ 284,114 $ 399 $ 142,804 $ 141,709 |
Available-for-Sale Securities Based on Stated Effective Maturities | The following table summarizes the cost and estimated fair value of marketable securities classified as available-for-sale securities based on stated effective maturities as of September 30, 2016: (amount in thousands) Carrying Cost Fair Value Due within one year $ 16,828 $ 16,830 Due between one to three years 130,662 130,872 Total $ 147,490 $ 147,702 |
Fair value of financial instr27
Fair value of financial instruments (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Financial Instruments Measured at Fair Value on Recurring Basis | The following table provides details of the financial instruments measured at fair value on a recurring basis, including: Fair Value Measurements at Reporting Date Using (amount in thousands) Level 1 Level 2 Level 3 Total As of September 30, 2016 Assets Cash equivalents $ — $ 185 $ — $ 185 Corporate bonds and commercial papers — 117,161 — 117,161 U.S. agency and U.S. treasury securities — 29,388 — 29,388 Sovereign and municipal securities — 1,153 — 1,153 Total $ — $ 147,887 $ — $ 147,887 Liabilities Derivative liabilities $ — $ 49 (1) $ — $ 49 Total $ — $ 49 $ — $ 49 Fair Value Measurements at Reporting Date Using (amount in thousands) Level 1 Level 2 Level 3 Total As of June 24, 2016 Assets Cash equivalents $ — $ 6,050 $ — $ 6,050 Corporate bonds and commercial papers — 112,522 — 112,522 U.S. agency and U.S. treasury securities — 28,030 — 28,030 Sovereign and municipal securities — 1,157 — 1,157 Derivative assets — 158 (2) — 158 Total $ — $ 147,917 $ — $ 147,917 Liabilities Derivative liabilities $ — $ 1,754 (3) $ — $ 1,754 Total $ — $ 1,754 $ — $ 1,754 (1) Foreign currency forward contracts with notional amount of $42.5 million and Canadian dollars 0.4 million. (2) Foreign currency forward contracts with notional amount of $7.0 million. (3) Foreign currency forward contracts with notional amount of $77.5 million and Canadian dollars 0.6 million. |
Trade accounts receivable, net
Trade accounts receivable, net (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Trade Accounts Receivable, Net | (amount in thousands) As of September 30, 2016 As of June 24, 2016 Trade accounts receivable $ 212,774 $ 196,178 Less: Allowance for doubtful account (90 ) (33 ) Trade accounts receivable, net $ 212,684 $ 196,145 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Inventories | (amount in thousands) As of September 30, 2016 As of June 24, 2016 Raw materials $ 66,759 $ 58,199 Work in progress 106,702 94,762 Finished goods 23,007 21,593 Goods in transit 12,491 9,381 208,959 183,935 Less: Inventory obsolescence (3,475 ) (2,436 ) Inventory, net $ 205,484 $ 181,499 |
Business acquisition (Tables)
Business acquisition (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Preliminary Allocation of Total Purchase Price | The Company’s preliminary allocation of the total purchase price for the acquisition is summarized below: (amount in thousands) Purchase price Cash $ 474 Accounts receivable 4,698 Inventory 2,633 Other current assets 425 Property, plant and equipment 5,660 Intangibles 4,472 Goodwill 2,994 Other non-current assets 509 Current liabilities (6,792 ) Other non-current liabilities (1,556 ) Total fair value of assets acquired and liabilities assumed $ 13,517 Total purchase price, net of cash acquired $ 13,043 |
Intangibles (Tables)
Intangibles (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Intangibles | The following tables present details of the Company’s intangibles: (amount in thousands) Gross Carrying Accumulated Net As of September 30, 2016 Software $ 3,915 $ (3,296 ) $ 619 Customer relationships 4,372 — 4,372 Backlog 100 — 100 Total intangibles $ 8,387 $ (3,296 ) $ 5,091 (amount in thousands) Gross Carrying Accumulated Net As of June 24, 2016 Software $ 3,786 $ (3,287 ) $ 499 Customer relationships — — — Backlog — — — Total intangibles $ 3,786 $ (3,287 ) $ 499 |
Estimated Future Amortization of intangibles | Based on the carrying amount of intangibles as of September 30, 2016, and assuming no future impairment of the underlying assets, the estimated future amortization during each fiscal year was as follows: (amount in thousands) 2017 (remaining nine months) $ 461 2018 614 2019 614 2020 585 2021 517 Thereafter 2,300 Total $ 5,091 |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill were as follows; (amount in thousands) Goodwill Balance as of June 24, 2016 $ — Addition in connection with business acquisition 2,994 Balance as of September 30, 2016 $ 2,994 |
Borrowings (Tables)
Borrowings (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Total Borrowings, Including Short-Term and Long-Term Borrowings | The Company’s total borrowings, including short-term and long-term borrowings, consisted of the following: (amount in thousands) Rate (1) Conditions Maturity As of September 30, 2016 As of June 24, 2016 Short-term borrowing: Revolving borrowing: LIBOR + 1.75% per annum Repayable in 1 to 6 months October 2016 (2) $ 20,000 $ 6,500 Short-term loans from bank: Bank Base rate +1.85% per annum Repayable based on 1,182 — Current portion of long-term borrowing 16,600 18,100 37,782 24,600 Less: Unamortized debt issuance costs (266 ) (293 ) $ 37,516 $ 24,307 Long-term borrowing: LIBOR + 2.8% per annum Repayable in March 2017 $ 3,000 $ 4,500 Term loan borrowing: LIBOR +1.75% per annum Repayable in May 2019 46,600 50,000 49,600 54,500 Less: Current portion (16,600 ) (18,100 ) Unamortized debt issuance costs (241 ) (300 ) Non-current portion $ 32,759 $ 36,100 (1) LIBOR is London Interbank Offered Rate. (2) In October 2016, the maturity date was extended to November 2016. |
Movements of Long-Term Loans | The movements of long-term loans were as follows for the three months ended September 30, 2016 and September 25, 2015: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Opening balance $ 54,500 $ 10,500 Repayments during the period (4,900 ) (1,500 ) Closing balance $ 49,600 $ 9,000 |
Future Maturities of Long-Term Debt | As of September 30, 2016, future maturities of long-term debt during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 13,200 2018 13,600 2019 22,800 Total $ 49,600 |
Undrawn Available Credit Facilities Classified by Availability Period of Future Borrowing | Undrawn available credit facilities classified by availability period of future borrowing as of September 30, 2016 and June 24, 2016 were as follows: (amount in thousands) September 30, 2016 June 24, 2016 Short-term $ 2,999 $ 1,414 Long-term $ 133,400 $ 143,500 |
Share-based compensation (Table
Share-based compensation (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Effect of Recording Share-Based Compensation Expense | The effect of recording share-based compensation expense for the three months ended September 30, 2016 and September 25, 2015 was as follows: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Share-based compensation expense by type of award: Share options $ — $ 16 Restricted share units 4,820 2,657 Performance share units 791 — Total share-based compensation expense 5,611 2,673 Tax effect on share-based compensation expense — — Net effect on share-based compensation expense $ 5,611 $ 2,673 |
Share-Based Compensation Expense Recorded in unaudited Condensed Consolidated Statements of Operations and Comprehensive Income | Share-based compensation expense was recorded in the unaudited condensed consolidated statements of operations and comprehensive income as follows: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 Cost of revenue $ 1,014 $ 537 Selling, general and administrative expense 4,597 2,136 Total share-based compensation expense $ 5,611 $ 2,673 |
Share Option Activity | The following summarizes share option activity: Number of Shares Number of Weighted- Per Share Weighted- Per Share Balance as of June 24, 2016 464,334 464,334 $ 15.95 Granted — — — Exercised (158,317 ) $ 17.10 Forfeited — — Expired — — Balance as of September 30, 2016 306,017 306,017 $ 15.36 Number of Shares Number of Weighted- Per Share Weighted- Per Share Balance as of June 26, 2015 792,019 758,451 $ 16.33 Granted — — — Exercised (98,759 ) $ 15.67 Forfeited (213 ) $ 14.43 Expired — — Balance as of September 25, 2015 693,047 680,798 $ 16.42 |
Information for Share Options Outstanding | The following summarizes information for share options outstanding as of September 30, 2016 under the Share Option Plans: Range of Number of Weighted- Aggregate (amount in thousands) $5.75 – $15.05 185,092 1.94 $15.16 – $16.83 112,375 1.09 $18.60 – $26.16 8,550 2.02 Options outstanding 306,017 1.63 $ 8,945 Options exercisable 306,017 1.63 $ 8,945 |
Restricted Share Unit Activity | The following summarizes restricted share unit activity under the 2010 Plan: Number of Shares Weighted- Per Share Balance as of June 24, 2016 1,181,402 $ 18.34 Granted 568,283 $ 39.53 Issued (408,874 ) (1) $ 16.23 Forfeited (19,347 ) $ 19.12 Balance as of September 30, 2016 1,321,464 $ 28.10 Number of Shares Weighted- Per Share Balance as of June 26, 2015 1,140,927 $ 16.02 Granted 499,896 $ 19.34 Issued (286,374 ) $ 14.69 Forfeited (6,587 ) $ 18.11 Balance as of September 26, 2015 1,347,862 $ 17.09 (1) Includes 875 shares vested on September 30, 2016, but not settled. |
Performance Share Unit Activity | The following summarizes performance share unit activity under the 2010 Plan: Number of Shares Weighted- Per Share Balance as of June 24, 2016 — — Granted 234,678 $ 40.48 Issued — — Forfeited — — Balance as of September 30, 2016 234,678 $ 40.48 |
Accumulated other comprehensi35
Accumulated other comprehensive income (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Changes in AOCI, Net of Tax | The changes in AOCI for the three months ended September 30, 2016 were as follows: (amount in thousands) Unrealized net Gains (Losses) on Marketable Securities Unrealized net Gains (Losses) on Derivative Instruments Foreign Total Balance as of June 24, 2016 $ 399 $ 192 $ — $ 591 Other comprehensive income before reclassification adjustment (87 ) — 741 654 Amounts reclassified out of AOCI to foreign exchange loss in the unaudited condensed consolidated statement of operations and comprehensive income (100 ) (158 ) — (258 ) Tax effects — — — — Other comprehensive loss $ (187 ) $ (158 ) 741 $ 396 Balance as of September 30, 2016 $ 212 $ 34 $ 741 $ 987 |
Commitments and contingencies (
Commitments and contingencies (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Future Minimum Lease Payments Due Under Non-Cancelable Operating Leases | As of September 30, 2016, the future minimum lease payments due under non-cancelable operating leases during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 1,338 2018 1,685 2019 1,131 2020 922 2021 525 Thereafter 897 Total minimum operating lease payments $ 6,498 |
Future Minimum Lease Payments Due Under Non-Cancelable Capital Leases | As of September 30, 2016, the future minimum lease payments due under non-cancelable capital leases during each fiscal year were as follows: (amount in thousands) 2017 (remaining nine months) $ 301 2018 416 2019 429 2020 376 2021 156 Total minimum capital lease payments $ 1,678 |
Business segments and geograp37
Business segments and geographic information (Tables) | 3 Months Ended |
Sep. 30, 2016 | |
Total Revenues by Geographic Regions | The Company operates primarily in three geographic regions: North America, Asia-Pacific and Europe. The following table presents total revenues by geographic regions: Three Months Ended (amount in thousands) September 30, 2016 September 25, 2015 North America $ 165,995 $ 106,443 Asia-Pacific 114,745 83,890 Europe 51,303 26,100 $ 332,043 $ 216,433 |
Accounting Policies - Additiona
Accounting Policies - Additional information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Sep. 14, 2016 | Jun. 24, 2016 |
Accounting Policies [Line Items] | |||
Restricted cash in connection with business acquisition | $ 3,379 | ||
Deferred tax assets | 2,503 | $ 1,806 | |
ASU 2015-17 | |||
Accounting Policies [Line Items] | |||
Deferred tax assets | 1,200 | ||
ASU 2015-15 | |||
Accounting Policies [Line Items] | |||
Debt issuance costs | $ 500 | $ 600 | |
Global CEM Solutions, Ltd. | |||
Accounting Policies [Line Items] | |||
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% | ||
Restricted cash in connection with business acquisition | $ 3,379 |
Earnings Per Ordinary Share (De
Earnings Per Ordinary Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | ||
Sep. 30, 2016 | Sep. 25, 2015 | ||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Net income attributable to shareholders | $ 22,766 | $ 1,603 | |
Weighted-average number of ordinary shares outstanding (thousands of shares) | 36,404 | 35,579 | |
Incremental shares arising from the assumed exercise of share options and vesting of restricted share units (thousands of shares) | 926 | 736 | |
Weighted-average number of ordinary shares for diluted earnings per ordinary share (thousands of shares) | 37,330 | 36,315 | |
Basic earnings per ordinary share | $ 0.63 | $ 0.05 | |
Diluted earnings per ordinary share | $ 0.61 | $ 0.04 | |
Outstanding share options excluded in the computation of diluted earnings per ordinary share | [1] | 62,304 | |
[1] | These share options were not included in the computation of diluted earnings per ordinary share because the exercise price of the options was greater than the average market price of the underlying shares. |
Cash, Cash Equivalents, and Mar
Cash, Cash Equivalents, and Marketable Securities (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 | Sep. 25, 2015 | Jun. 26, 2015 |
Cash, cash equivalents and marketable securities [Line Items] | ||||
Cash and cash equivalents and Marketable securities, Carrying Cost | $ 253,350 | $ 284,114 | ||
Marketable securities, Unrealized Gain/(Loss) | 212 | 399 | ||
Cash and cash equivalents | 105,860 | 142,804 | $ 95,465 | $ 112,978 |
Marketable securities | 147,702 | 141,709 | ||
Cash | ||||
Cash, cash equivalents and marketable securities [Line Items] | ||||
Carrying Cost | 105,675 | 136,754 | ||
Cash and cash equivalents | 105,675 | 136,754 | ||
Cash Equivalents | ||||
Cash, cash equivalents and marketable securities [Line Items] | ||||
Carrying Cost | 185 | 6,050 | ||
Cash and cash equivalents | 185 | 6,050 | ||
Corporate bonds and commercial papers | ||||
Cash, cash equivalents and marketable securities [Line Items] | ||||
Marketable securities, Carrying cost | 116,926 | 112,128 | ||
Marketable securities, Unrealized Gain/(Loss) | 235 | 394 | ||
Marketable securities | 117,161 | 112,522 | ||
U.S. agency and U.S. treasury securities | ||||
Cash, cash equivalents and marketable securities [Line Items] | ||||
Marketable securities, Carrying cost | 29,411 | 28,028 | ||
Marketable securities, Unrealized Gain/(Loss) | (23) | 2 | ||
Marketable securities | 29,388 | 28,030 | ||
Sovereign And Municipal Securities | ||||
Cash, cash equivalents and marketable securities [Line Items] | ||||
Marketable securities, Carrying cost | 1,153 | 1,154 | ||
Marketable securities, Unrealized Gain/(Loss) | 3 | |||
Marketable securities | $ 1,153 | $ 1,157 |
Cash, Cash Equivalents and Ma41
Cash, Cash Equivalents and Marketable Securities - Additional Information (Detail) | 3 Months Ended |
Sep. 30, 2016USD ($) | |
Cash, cash equivalents and marketable securities [Line Items] | |
Loss from sales and maturities of available-for-sale securities | $ 100,000 |
Impairment losses | 0 |
Cash, cash equivalents and marketable securities at financial institutions located in the United States | $ 40,000,000 |
Minimum | |
Cash, cash equivalents and marketable securities [Line Items] | |
Maturities Period of Short-term marketable securities | 3 months |
Maximum | |
Cash, cash equivalents and marketable securities [Line Items] | |
Maturities Period of Short-term marketable securities | 3 years |
Available-for-Sale Securities B
Available-for-Sale Securities Based on Stated Effective Maturities (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Adjusted cost | ||
Due within one year | $ 16,828 | |
Due between one to three years | 130,662 | |
Total | 147,490 | |
Fair value | ||
Due within one year | 16,830 | |
Due between one to three years | 130,872 | |
Total | $ 147,702 | $ 141,709 |
Financial Instruments Measured
Financial Instruments Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 | |||
Assets | |||||
Total | $ 147,887 | $ 147,917 | |||
Derivative assets | 158 | ||||
Liabilities | |||||
Derivative liabilities | 49 | 1,754 | |||
Total | 49 | 1,754 | |||
Cash Equivalents | |||||
Assets | |||||
Marketable securities | 185 | 6,050 | |||
Corporate bonds and commercial papers | |||||
Assets | |||||
Marketable securities | 117,161 | 112,522 | |||
U.S. agency and U.S. treasury securities | |||||
Assets | |||||
Marketable securities | 29,388 | 28,030 | |||
Sovereign And Municipal Securities | |||||
Assets | |||||
Marketable securities | 1,153 | 1,157 | |||
Significant Other Observable Inputs (Level 2) | |||||
Assets | |||||
Total | 147,887 | 147,917 | |||
Derivative assets | [1] | 158 | |||
Liabilities | |||||
Derivative liabilities | 49 | [2] | 1,754 | [3] | |
Total | 49 | 1,754 | |||
Significant Other Observable Inputs (Level 2) | Cash Equivalents | |||||
Assets | |||||
Marketable securities | 185 | 6,050 | |||
Significant Other Observable Inputs (Level 2) | Corporate bonds and commercial papers | |||||
Assets | |||||
Marketable securities | 117,161 | 112,522 | |||
Significant Other Observable Inputs (Level 2) | U.S. agency and U.S. treasury securities | |||||
Assets | |||||
Marketable securities | 29,388 | 28,030 | |||
Significant Other Observable Inputs (Level 2) | Sovereign And Municipal Securities | |||||
Assets | |||||
Marketable securities | $ 1,153 | $ 1,157 | |||
[1] | Foreign currency forward contracts with notional amount of $7.0 million. | ||||
[2] | Foreign currency forward contracts with notional amount of $42.5 million and Canadian dollars 0.4 million. | ||||
[3] | Foreign currency forward contracts with notional amount of $77.5 million and Canadian dollars 0.6 million. |
Financial Instruments Measure44
Financial Instruments Measured at Fair Value on Recurring Basis (Parenthetical) (Detail) - Foreign currency forward contracts - Fair Value, Measurements, Recurring CAD in Millions, $ in Millions | Sep. 30, 2016USD ($) | Sep. 30, 2016CAD | Jun. 24, 2016USD ($) | Jun. 24, 2016CAD |
Fair Value Measurements at Reporting Date Using | ||||
Derivative liabilities, notional amount | $ 42.5 | CAD 0.4 | $ 77.5 | CAD 0.6 |
Derivative assets, notional amount | $ 7 |
Fair Value of Financial Instr45
Fair Value of Financial Instruments - Additional Information (Detail) $ in Thousands, ¥ in Millions, CAD in Millions | 3 Months Ended | ||||||
Sep. 30, 2016USD ($)Contract | Sep. 25, 2015USD ($)Contract | Sep. 30, 2016CADContract | Jun. 24, 2016USD ($) | Sep. 30, 2015Contract | Sep. 25, 2015CADContract | Sep. 25, 2015JPY (¥)Contract | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Unrealized gain (loss) on derivatives | $ 1,913 | $ (10,855) | |||||
Foreign currency forward contracts | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Derivative assets | $ 200 | ||||||
Derivative liabilities | $ 50 | $ 1,700 | |||||
Foreign currency forward contracts | Non designated | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Number of forward contracts outstanding | Contract | 9 | 9 | |||||
Derivative liabilities, notional amount | $ 42,500 | CAD 0.4 | |||||
Unrealized gain (loss) on derivatives | $ (50) | ||||||
Derivative notional amount | 169,500 | CAD 1 | ¥ 0.1 | ||||
Foreign currency forward contracts | Non designated | Minimum | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Derivative maturity period | 2016-10 | ||||||
Foreign currency forward contracts | Non designated | Maximum | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Derivative maturity period | 2016-12 | ||||||
Foreign currency forward contracts | Cash Flow Hedging | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Gain recognized from discontinued cash flow hedges | $ 300 | ||||||
Number of forward contracts outstanding | Contract | 0 | 0 | 0 | ||||
Foreign currency cash flow hedge gain to be reclassified during next 12 months | $ 10 | ||||||
Forward Foreign Currency and Option Contracts | Non designated | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Unrealized gain (loss) on derivatives | $ 12,100 | ||||||
Forward Foreign Currency and Option Contracts | Non designated | Minimum | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Derivative maturity period | 2015-09 | ||||||
Forward Foreign Currency and Option Contracts | Non designated | Maximum | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Derivative maturity period | 2016-12 | ||||||
Foreign currency options | Non designated | |||||||
Foreign Currency Fair Value Hedge Derivative [Line Items] | |||||||
Number of forward contracts outstanding | Contract | 42 | 42 | 42 | ||||
Derivative notional amount | $ 11,000 |
Trade Accounts Receivable, Ne46
Trade Accounts Receivable, Net (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Trade accounts receivable | $ 212,774 | $ 196,178 |
Less: Allowance for doubtful account | (90) | (33) |
Trade accounts receivable, net | $ 212,684 | $ 196,145 |
Trade Accounts Receivable, Ne47
Trade Accounts Receivable, Net - Additional Information (Detail) $ in Millions | Sep. 30, 2016USD ($) |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Trade accounts receivable secured to short-term loans from bank | $ 1.7 |
Inventory (Detail)
Inventory (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 66,759 | $ 58,199 |
Work in progress | 106,702 | 94,762 |
Finished goods | 23,007 | 21,593 |
Goods in transit | 12,491 | 9,381 |
Inventory, Gross, Total | 208,959 | 183,935 |
Less: Inventory obsolescence | (3,475) | (2,436) |
Inventory, net | $ 205,484 | $ 181,499 |
Business Acquisition - Addition
Business Acquisition - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 14, 2016 | Sep. 30, 2016 |
Business Acquisition [Line Items] | ||
Total cash consideration, net of cash acquired | $ 9,664 | |
Restricted cash in connection with business acquisition | 3,379 | |
Foreign exchange currency translation adjustment | 741 | |
Global CEM Solutions, Ltd. | ||
Business Acquisition [Line Items] | ||
Total cash consideration, net of cash acquired | $ 13,043 | |
Business acquisition, cash acquired | $ 500 | |
Percentage of ownership acquired | 100.00% | |
Restricted cash in connection with business acquisition | $ 3,379 | |
Foreign exchange currency translation adjustment | 741 | |
Capital lease assets | 2,200 | |
Capital lease liability | 1,700 | |
Global CEM Solutions, Ltd. | Customer relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired | $ 4,400 | |
Estimated remaining useful life | 10 years | |
Global CEM Solutions, Ltd. | Backlog | ||
Business Acquisition [Line Items] | ||
Intangible assets acquired | $ 100 | |
Estimated remaining useful life | 3 years | |
Global CEM Solutions, Ltd. | Selling, General and Administrative Expenses | ||
Business Acquisition [Line Items] | ||
Transaction costs related to acquisition | $ 1,100 |
Preliminary Allocation of Total
Preliminary Allocation of Total Purchase Price (Detail) - USD ($) $ in Thousands | Sep. 14, 2016 | Sep. 30, 2016 | Jun. 24, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 2,994 | $ 0 | |
Total purchase price, net of cash acquired | $ 9,664 | ||
Global CEM Solutions, Ltd. | |||
Business Acquisition [Line Items] | |||
Cash | $ 474 | ||
Accounts receivable | 4,698 | ||
Inventory | 2,633 | ||
Other current assets | 425 | ||
Property, plant and equipment | 5,660 | ||
Intangibles | 4,472 | ||
Goodwill | 2,994 | ||
Other non-current assets | 509 | ||
Current liabilities | (6,792) | ||
Other non-current liabilities | (1,556) | ||
Total fair value of assets acquired and liabilities assumed | 13,517 | ||
Total purchase price, net of cash acquired | $ 13,043 |
Intangibles (Detail)
Intangibles (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 8,387 | $ 3,786 |
Accumulated Amortization | (3,296) | (3,287) |
Net | 5,091 | 499 |
Software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 3,915 | 3,786 |
Accumulated Amortization | (3,296) | (3,287) |
Net | 619 | $ 499 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 4,372 | |
Net | 4,372 | |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 100 | |
Net | $ 100 |
Intangibles - Additional Inform
Intangibles - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization expense related to intangibles | $ 30 | $ 10 |
Global CEM Solutions, Ltd. | Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 4,400 | |
Weighted average life of acquired intangible assets | 7 years 6 months | |
Global CEM Solutions, Ltd. | Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets acquired | $ 100 | |
Weighted average life of acquired intangible assets | 2 years 3 months 18 days |
Estimated Future Amortization o
Estimated Future Amortization of Intangibles (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
2017 (remaining nine months) | $ 461 | |
2,018 | 614 | |
2,019 | 614 | |
2,020 | 585 | |
2,021 | 517 | |
Thereafter | 2,300 | |
Net | $ 5,091 | $ 499 |
Goodwill - Additional Informati
Goodwill - Additional Information (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Sep. 14, 2016 | Jun. 24, 2016 |
Goodwill [Line Items] | |||
Goodwill | $ 2,994 | $ 0 | |
Global CEM Solutions, Ltd. | |||
Goodwill [Line Items] | |||
Goodwill | $ 2,994 |
Changes in Carrying Amount of G
Changes in Carrying Amount of Goodwill (Detail) $ in Thousands | 3 Months Ended |
Sep. 30, 2016USD ($) | |
Goodwill [Line Items] | |
Balance as of June 24, 2016 | $ 0 |
Addition in connection with business acquisition | 2,994 |
Balance as of September 30, 2016 | $ 2,994 |
Total Borrowings, Including Sho
Total Borrowings, Including Short-Term and Long-Term Borrowings (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||||
Sep. 30, 2016 | Jun. 24, 2016 | Sep. 25, 2015 | Jun. 26, 2015 | ||
Debt Instrument [Line Items] | |||||
Revolving borrowing | $ 20,000 | $ 6,500 | |||
Short-term loans from bank | 1,182 | ||||
Current portion of long-term borrowing | 16,600 | 18,100 | |||
Bank borrowings, gross | 37,782 | 24,600 | |||
Less: Unamortized debt issuance costs | (266) | (293) | |||
Bank borrowings, net of unamortized debt issuance costs | 37,516 | 24,307 | |||
Long-term borrowing | 49,600 | 54,500 | $ 9,000 | $ 10,500 | |
Unamortized debt issuance costs | (241) | (300) | |||
Non-current portion | $ 32,759 | 36,100 | |||
Short-term loans from bank | |||||
Debt Instrument [Line Items] | |||||
Rate | [1] | Bank Base rate +1.85% per annum | |||
Conditions | Repayable based on credit term of secured accounts receivables | ||||
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Rate | [1] | LIBOR + 1.75% per annum | |||
Conditions | Repayable in 1 to 6 months | ||||
Term | [2] | 2016-10 | |||
Revolving borrowing | $ 20,000 | ||||
Revolving Credit Facility | Minimum | |||||
Debt Instrument [Line Items] | |||||
Repayment duration | 1 month | ||||
Revolving Credit Facility | Maximum | |||||
Debt Instrument [Line Items] | |||||
Repayment duration | 6 months | ||||
LIBOR | Minimum | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 1.75% | ||||
LIBOR | Maximum | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 2.50% | ||||
LIBOR | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 1.75% | ||||
Base Rate | Minimum | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 0.75% | ||||
Base Rate | Maximum | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 1.50% | ||||
Base Rate | Short-term loans from bank | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 1.85% | ||||
Loans Payable Due March 2017 | |||||
Debt Instrument [Line Items] | |||||
Rate | [1] | LIBOR + 2.8% per annum | |||
Conditions | Repayable in quarterly installments | ||||
Term | 2017-03 | ||||
Long-term borrowing | $ 3,000 | 4,500 | |||
Loans Payable Due March 2017 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 2.80% | ||||
Loans Payable Due May 2019 | |||||
Debt Instrument [Line Items] | |||||
Rate | [1] | LIBOR + 1.75% per annum | |||
Conditions | Repayable in quarterly installments | ||||
Term | 2019-05 | ||||
Long-term borrowing | $ 46,600 | $ 50,000 | |||
Loans Payable Due May 2019 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Margin above rate | 1.75% | ||||
[1] | In October 2016, the maturity date was extended to November 2016. | ||||
[2] | LIBOR is London Interbank Offered Rate. |
Total Borrowings, Including S57
Total Borrowings, Including Short-Term and Long-Term Borrowings (Parenthetical) (Detail) | 1 Months Ended |
Oct. 31, 2016 | |
Subsequent Event | |
Debt Instrument [Line Items] | |
Extended maturity date | 2016-11 |
Borrowings - Additional Informa
Borrowings - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | |
Oct. 31, 2016 | Sep. 30, 2016 | Jun. 24, 2016 | |
Line of Credit Facility [Line Items] | |||
Line of credit facility borrowing capacity | $ 200,000,000 | ||
Line of credit facility amounts outstanding | 20,000,000 | $ 6,500,000 | |
Undrawn available credit facilities | 133,400,000 | ||
Cash, cash equivalents and marketable securities at financial institutions located in the United States | 40,000,000 | ||
Deposits or securities | 10,000,000 | ||
Minimum net worth required for credit agreement | $ 200,000,000 | ||
Percentage of quarterly net income required for credit agreement | 50.00% | ||
Minimum debt service coverage ratio | 150.00% | ||
Maximum senior leverage ratio | 250.00% | ||
Minimum quick ratio required for credit agreement | 110.00% | ||
Trade accounts receivable, net | $ 212,684,000 | 196,145,000 | |
Property, plant and equipment, net | 205,845,000 | 178,410,000 | |
Short-term loans from bank | 1,182,000 | ||
Subsequent Event | |||
Line of Credit Facility [Line Items] | |||
Extended maturity date | 2016-11 | ||
Bank borrowing No. 1 | Subsidiary | |||
Line of Credit Facility [Line Items] | |||
Carrying amount of assets secured and pledged as collateral | 47,000,000 | $ 47,700,000 | |
Short-term loans from bank | |||
Line of Credit Facility [Line Items] | |||
Trade accounts receivable, net | 5,500,000 | ||
Property, plant and equipment, net | $ 4,900,000 | ||
Credit facility maximum borrowing capacity, percentage | 4.00% | ||
Interest rate on short term loans | 1.85% | ||
LIBOR | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate | LIBOR rate plus a spread of 1.75% to 2.50% | ||
LIBOR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 1.75% | ||
LIBOR | Maximum | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 2.50% | ||
Base Rate | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate | Base rate plus a spread of 0.75% to 1.50%, determined in accordance with the Facility Agreement | ||
Base Rate | Minimum | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 0.75% | ||
Base Rate | Maximum | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 1.50% | ||
Base Rate | Short-term loans from bank | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 1.85% | ||
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility borrowing capacity | $ 150,000,000 | ||
Line of credit facility increase in borrowing capacity | $ 100,000,000 | ||
Line of credit expiration date | May 22, 2019 | ||
Line of credit facility amounts outstanding | $ 20,000,000 | ||
Revolving Credit Facility | Subsequent Event | |||
Line of Credit Facility [Line Items] | |||
Extended maturity date | 2016-11 | ||
Revolving Credit Facility | Minimum | |||
Line of Credit Facility [Line Items] | |||
Repayment duration | 1 month | ||
Revolving Credit Facility | Maximum | |||
Line of Credit Facility [Line Items] | |||
Repayment duration | 6 months | ||
Revolving Credit Facility | LIBOR | |||
Line of Credit Facility [Line Items] | |||
Credit line interest rate, percentage | 1.75% | ||
Term Loan Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Line of credit facility borrowing capacity | $ 50,000,000 | ||
Line of credit expiration date | May 22, 2019 | ||
Line of credit facility amounts outstanding | $ 46,600,000 |
Movements of Long-Term Loans (D
Movements of Long-Term Loans (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Debt Instrument [Line Items] | ||
Opening balance | $ 54,500 | $ 10,500 |
Repayments during the period | (4,900) | (1,500) |
Closing balance | $ 49,600 | $ 9,000 |
Future Maturities of Long-Term
Future Maturities of Long-Term Debt (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 | Sep. 25, 2015 | Jun. 26, 2015 |
Debt Instrument [Line Items] | ||||
2017 (remaining nine months) | $ 13,200 | |||
2,018 | 13,600 | |||
2,019 | 22,800 | |||
Total | $ 49,600 | $ 54,500 | $ 9,000 | $ 10,500 |
Undrawn Available Credit Facili
Undrawn Available Credit Facilities Classified by Availability Period of Future Borrowing (Detail) - USD ($) $ in Thousands | Sep. 30, 2016 | Jun. 24, 2016 |
Line of Credit Facility [Line Items] | ||
Undrawn available credit facilities | $ 133,400 | |
Short-term loans | ||
Line of Credit Facility [Line Items] | ||
Undrawn available credit facilities | 2,999 | $ 1,414 |
Long-term loans | ||
Line of Credit Facility [Line Items] | ||
Undrawn available credit facilities | $ 133,400 | $ 143,500 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2016 | Sep. 25, 2015 | Jun. 24, 2016 | |
Income Taxes [Line Items] | |||
Liability for uncertain tax positions including accrued interest and penalties | $ 1.9 | $ 1.8 | |
Corporate effective income tax rate | 6.70% | 6.70% | |
Earliest Tax Year | |||
Income Taxes [Line Items] | |||
Tax year remain open to examination | 2,012 | ||
Latest Tax Year | |||
Income Taxes [Line Items] | |||
Tax year remain open to examination | 2,016 |
Effect of Recording Share-Based
Effect of Recording Share-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Share-based compensation expense by type of award: | ||
Share options | $ 16 | |
Restricted share units | $ 4,820 | 2,657 |
Performance share units | 791 | |
Total share-based compensation expense | 5,611 | 2,673 |
Tax effect on share-based compensation expense | 0 | 0 |
Net effect on share-based compensation expense | $ 5,611 | $ 2,673 |
Share-Based Compensation Expens
Share-Based Compensation Expense Recorded in Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 5,611 | $ 2,673 |
Cost of Revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 1,014 | 537 |
Selling, General and Administrative Expenses | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 4,597 | $ 2,136 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Detail) - USD ($) | 3 Months Ended | ||||
Sep. 30, 2016 | Sep. 25, 2015 | Jun. 24, 2016 | Sep. 26, 2015 | Jun. 26, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation costs capitalized | $ 0 | $ 0 | |||
Shares withheld to settle employee minimum statutory obligation for applicable income and other employment taxes | 22,294 | 46,016 | |||
Tax withholdings related to net share settlement of restricted share units | $ 867,000 | $ 878,000 | |||
Stock Plan 1999 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share options outstanding | 5 | ||||
Stock Plan 2010 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share options outstanding | 306,012 | ||||
Ordinary shares available for future grant | 1,404,646 | ||||
Employee Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award granted vesting period, year | 4 years | ||||
Options expiration period, year | 7 years | ||||
Employee Stock Option | Stock Plan 2010 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized share-based compensation expense | $ 0 | ||||
Employee Stock Option | Vest 12 months after the vesting commencement date | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 25.00% | ||||
Employee Stock Option | Vest monthly over each of the subsequent 36 months | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 2.083% | ||||
Employee Stock Option | Vest monthly over four years, commencing one month after the vesting commencement date | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 2.083% | ||||
Restricted Share Units | Stock Plan 2010 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share units outstanding | 1,321,464 | 1,181,402 | 1,347,862 | 1,140,927 | |
Unrecognized share-based compensation expense | $ 35,300,000 | ||||
Unrecognized compensation expense, weighted-average period for recognition | 2 years 9 months 7 days | ||||
Restricted Share Units | Vesting Option One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award granted vesting period, year | 3 years | ||||
Restricted Share Units | Vesting Option Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award granted vesting period, year | 4 years | ||||
Restricted Share Units | Non Employee Director | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award granted vesting period, year | 1 year | ||||
Restricted Share Units | Non Employee Director | Vest on the first of January | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 100.00% | ||||
Restricted Share Units | Executive of the Company | Granted to the executive prior to August 2016 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 100.00% | ||||
Restricted Share Units | Executive of the Company | Granted to the executive in August 2016 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 100.00% | ||||
Performance Share Units | Stock Plan 2010 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share units outstanding | 234,678 | ||||
Performance Share Units | Executive of the Company | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award granted vesting period, year | 2 years | ||||
Performance Share Units | Executive of the Company | Vest at the end of the performance period | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 0.00% | ||||
Performance Share Units | Executive of the Company | Vest at the end of the performance period | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting percentage | 100.00% |
Share Option Activity (Detail)
Share Option Activity (Detail) - Stock Plan Nineteen Ninety Nine and Twenty Ten - $ / shares | 3 Months Ended | |||
Sep. 30, 2016 | Sep. 25, 2015 | Jun. 24, 2016 | Jun. 26, 2015 | |
Number of shares | ||||
Beginning balance | 464,334 | 792,019 | ||
Granted | 0 | 0 | ||
Exercised | (158,317) | (98,759) | ||
Forfeited | (213) | |||
Expired | 0 | 0 | ||
Ending balance | 306,017 | 693,047 | ||
Number of Exercisable Options | ||||
Number of Exercisable Options | 306,017 | 680,798 | 464,334 | 758,451 |
Weighted-Average Exercise Price per share | ||||
Beginning balance | $ 15.95 | $ 16.33 | ||
Granted | 0 | 0 | ||
Exercised | 17.10 | 15.67 | ||
Forfeited | 14.43 | |||
Expired | 0 | 0 | ||
Ending balance | 15.36 | 16.42 | ||
Weighted-Average Grant Date Fair Value | ||||
Granted | $ 0 | $ 0 |
Information for Share Options O
Information for Share Options Outstanding (Detail) $ / shares in Units, $ in Thousands | 3 Months Ended |
Sep. 30, 2016USD ($)$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number of Shares Underlying Options, outstanding | shares | 306,017 |
Options outstanding, weighted average remaining contractual life (years) | 1 year 7 months 17 days |
Options outstanding, aggregate intrinsic value | $ | $ 8,945 |
Range of Exercise Price 1 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Price, Minimum | $ 5.75 |
Range of Exercise Price, Maximum | $ 15.05 |
Number of Shares Underlying Options, outstanding | shares | 185,092 |
Options outstanding, weighted average remaining contractual life (years) | 1 year 11 months 9 days |
Range of Exercise Price 2 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Price, Minimum | $ 15.16 |
Range of Exercise Price, Maximum | $ 16.83 |
Number of Shares Underlying Options, outstanding | shares | 112,375 |
Options outstanding, weighted average remaining contractual life (years) | 1 year 1 month 2 days |
Range of Exercise Price 3 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of Exercise Price, Minimum | $ 18.60 |
Range of Exercise Price, Maximum | $ 26.16 |
Number of Shares Underlying Options, outstanding | shares | 8,550 |
Options outstanding, weighted average remaining contractual life (years) | 2 years 7 days |
Stock Plan Nineteen Ninety Nine and Twenty Ten | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number of Shares Underlying Options, exercisable | shares | 306,017 |
Options exercisable, weighted average remaining contractual life (years) | 1 year 7 months 17 days |
Options exercisable, aggregate intrinsic value | $ | $ 8,945 |
Restricted Share Unit Activity
Restricted Share Unit Activity (Detail) - Stock Plan 2010 - Restricted Share Units - $ / shares | 3 Months Ended | ||
Sep. 30, 2016 | Sep. 26, 2015 | ||
Number of restricted share units | |||
Number of share units, beginning balance | 1,181,402 | 1,140,927 | |
Number of share units, Granted | 568,283 | 499,896 | |
Number of share units, Issued | (408,874) | [1] | (286,374) |
Number of share units, Forfeited | (19,347) | (6,587) | |
Number of share units, ending balance | 1,321,464 | 1,347,862 | |
Weighted Average Grant Date Fair Value Per Share | |||
Weighted-average grant date fair value per share, Beginning Balance | $ 18.34 | $ 16.02 | |
Weighted-average grant date fair value per share, Granted | 39.53 | 19.34 | |
Weighted-average grant date fair value per share, Issued | 16.23 | 14.69 | |
Weighted-average grant date fair value per share, Forfeited | 19.12 | 18.11 | |
Weighted-average grant date fair value per share, Ending Balance | $ 28.10 | $ 17.09 | |
[1] | Includes 875 shares vested on September 30, 2016, but not settled. |
Restricted Share Unit Activit69
Restricted Share Unit Activity (Parenthetical) (Detail) | 3 Months Ended |
Sep. 30, 2016shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Restricted share unit of shares vested but not settled | 875 |
Performance Share Unit Activity
Performance Share Unit Activity (Detail) - Stock Plan 2010 - Performance Share Units | 3 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Number of performance share units | |
Number of share units, Granted | shares | 234,678 |
Number of share units, Issued | shares | 0 |
Number of share units, Forfeited | shares | 0 |
Number of share units, ending balance | shares | 234,678 |
Weighted Average Grant Date Fair Value Per Share | |
Weighted-average grant date fair value per share, Granted | $ / shares | $ 40.48 |
Weighted-average grant date fair value per share, Issued | $ / shares | 0 |
Weighted-average grant date fair value per share, Forfeited | $ / shares | 0 |
Weighted-average grant date fair value per share, Ending Balance | $ / shares | $ 40.48 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - $ / shares | 3 Months Ended | ||
Sep. 30, 2016 | Sep. 25, 2015 | Jun. 24, 2016 | |
Shareholders Equity [Line Items] | |||
Ordinary shares, authorized share capital | 500,000,000 | 500,000,000 | |
Ordinary shares, par value | $ 0.01 | $ 0.01 | |
Preferred shares, shares authorized | 5,000,000 | 5,000,000 | |
Preferred shares, par value | $ 0.01 | $ 0.01 | |
Stock Plan Nineteen Ninety Nine and Twenty Ten | |||
Shareholders Equity [Line Items] | |||
Ordinary shares issued upon exercise of options | 158,317 | 98,759 | |
Ordinary shares issued upon exercise of options, weight average exercise price | $ 17.10 | $ 15.67 | |
Ordinary shares issued upon vesting of restricted shares | 385,705 |
Changes in AOCI, Net of Tax (De
Changes in AOCI, Net of Tax (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | $ 554,419 | |
Other comprehensive income before reclassification adjustment | 654 | |
Amounts reclassified out of AOCI to foreign exchange loss in the unaudited condensed consolidated statement of operations and comprehensive income | (258) | |
Tax effects | 0 | |
Other comprehensive income (loss) | 396 | $ 87 |
Ending Balance | 585,033 | |
Unrealized Net Gains (Losses) on Marketable Securities | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 399 | |
Other comprehensive income before reclassification adjustment | (87) | |
Amounts reclassified out of AOCI to foreign exchange loss in the unaudited condensed consolidated statement of operations and comprehensive income | (100) | |
Tax effects | 0 | |
Other comprehensive income (loss) | (187) | |
Ending Balance | 212 | |
Unrealized Net Gains (Losses) on Derivative Instruments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 192 | |
Amounts reclassified out of AOCI to foreign exchange loss in the unaudited condensed consolidated statement of operations and comprehensive income | (158) | |
Tax effects | 0 | |
Other comprehensive income (loss) | (158) | |
Ending Balance | 34 | |
Foreign Currency Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income before reclassification adjustment | 741 | |
Tax effects | 0 | |
Other comprehensive income (loss) | 741 | |
Ending Balance | 741 | |
AOCI Attributable to Parent | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Beginning Balance | 591 | |
Tax effects | 0 | |
Ending Balance | $ 987 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2016 | Sep. 25, 2015 | Jun. 24, 2016 | |
Commitments and Contingencies Disclosure [Line Items] | |||
Outstanding bank guarantees given by banks on behalf of the company | $ 0.8 | $ 0.8 | |
Rental expense under operating leases | 0.4 | $ 0.3 | |
Outstanding commitment to third parties | $ 30.1 | ||
Maximum | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Operating lease expiration year | 2,023 |
Future Minimum Lease Payments D
Future Minimum Lease Payments Due Under Non-Cancelable Operating Leases (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Operating Leased Assets [Line Items] | |
2017 (remaining nine months) | $ 1,338 |
2,018 | 1,685 |
2,019 | 1,131 |
2,020 | 922 |
2,021 | 525 |
Thereafter | 897 |
Total minimum operating lease payments | $ 6,498 |
Future Minimum Lease Payments75
Future Minimum Lease Payments Due Under Non-Cancelable Capital Leases (Detail) $ in Thousands | Sep. 30, 2016USD ($) |
Capital Leased Assets [Line Items] | |
2017 (remaining nine months) | $ 301 |
2,018 | 416 |
2,019 | 429 |
2,020 | 376 |
2,021 | 156 |
Total minimum capital lease payments | $ 1,678 |
Business Segments and Geograp76
Business Segments and Geographic Information - Additional Information (Detail) $ in Millions | 3 Months Ended | ||
Sep. 30, 2016USD ($)CustomerSegment | Jun. 24, 2016Customer | Sep. 25, 2015USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of operating segment | Segment | 1 | ||
Number of customers | Customer | 1 | 2 | |
North America | |||
Segment Reporting Information [Line Items] | |||
Long-lived assets | $ | $ 36.4 | $ 33.9 |
Total Revenues by Geographic Re
Total Revenues by Geographic Regions (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items] | ||
Revenues | $ 332,043 | $ 216,433 |
North America | ||
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items] | ||
Revenues | 165,995 | 106,443 |
Asia Pacific | ||
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items] | ||
Revenues | 114,745 | 83,890 |
Europe | ||
Entity Wide Disclosure On Geographic Areas Revenue From External Customers Attributed To Individual Foreign And Domestic Countries [Line Items] | ||
Revenues | $ 51,303 | $ 26,100 |
Other Expense Related to Floo78
Other Expense Related to Flooding - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 25, 2016 | Sep. 25, 2015 | |
Unusual or Infrequent Item [Line Items] | ||
Other expense related to flooding | $ 864 | |
Proceeds from insurer in settlement of claims related to flood damage | $ 800 |