Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 04, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,015 | ||
Entity Registrant Name | Crimson Wine Group, Ltd | ||
Entity Central Index Key | 1,562,151 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 24,229,846 | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 186,432,000 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 18,333 | $ 13,274 |
Investments available for sale | 25,423 | 15,711 |
Accounts receivable, net | 6,121 | 5,784 |
Inventory | 55,636 | 49,593 |
Other current assets | 1,851 | 894 |
Total current assets | 107,364 | 85,256 |
Property and equipment, net | 111,635 | 108,707 |
Goodwill | 1,053 | 1,053 |
Intangible assets and other non-current assets | 15,894 | 17,300 |
Total non-current assets | 128,582 | 127,060 |
Total assets | 235,946 | 212,316 |
Current liabilities: | ||
Accounts payable | 3,936 | 4,342 |
Accrued compensation related expenses | 2,504 | 1,979 |
Other accrued expenses | 2,584 | 1,266 |
Customer deposits | 385 | 403 |
Current portion of long-term debt, net of unamortized loan fees | 633 | |
Total current liabilities | 10,042 | 7,990 |
Long-term debt, net of unamortized loan fees | 15,282 | |
Deferred rent, non-current | 120 | 123 |
Deferred tax liability | 3,642 | 1,083 |
Total non-current liabilities | 19,044 | 1,206 |
Total liabilities | 29,086 | 9,196 |
EQUITY | ||
Common shares, par value $0.01 per share, authorized 150,000,000 shares; 24,306,556 and 24,458,368 shares issued and outstanding at December 31, 2015 and 2014, respectively | 243 | 245 |
Additional paid-in capital | 277,520 | 277,520 |
Accumulated other comprehensive loss | (47) | (39) |
Accumulated deficit | (70,856) | (74,606) |
Total equity | 206,860 | 203,120 |
Total liabilities and equity | $ 235,946 | $ 212,316 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 25, 2013 |
Consolidated Balance Sheets [Abstract] | |||
Common shares, par value | $ 0.01 | $ 0.01 | $ 0.01 |
Common shares, shares authorized | 150,000,000 | 150,000,000 | 150,000,000 |
Common shares, shares issued | 24,306,556 | 24,458,368 | 24,458,368 |
Common shares, shares outstanding | 24,306,556 | 24,458,368 | 24,458,368 |
Consolidated Income Statements
Consolidated Income Statements - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Consolidated Statements Of Operations [Abstract] | ||||
Net sales | $ 60,977 | $ 58,114 | $ 56,472 | |
Cost of sales | 28,446 | 27,170 | 29,685 | |
Gross profit | 32,531 | 30,944 | 26,787 | |
Operating expenses: | ||||
Sales and marketing | 14,197 | 13,227 | 12,807 | |
General and administrative | 10,543 | [1] | 10,240 | 9,172 |
Administrative services fees to Leucadia National Corporation | 0 | 9 | 98 | |
Total operating expenses | 24,740 | 23,476 | 22,077 | |
Net gain on disposals of property and equipment | (59) | (1,553) | (649) | |
Income from operations | 7,850 | 9,021 | 5,359 | |
Other income (expense): | ||||
Interest expense | (252) | (152) | (901) | |
Other income (expense), net | 334 | (8) | 315 | |
Total other income (expense), net | 82 | (160) | (586) | |
Income before income taxes | 7,932 | 8,861 | 4,773 | |
Income tax provision (benefit) | 2,806 | 3,861 | (2,335) | |
Net income | $ 5,126 | $ 5,000 | $ 7,108 | |
Basic and fully diluted weighted-average shares | 24,434 | 24,458 | 24,458 | |
Basic and fully diluted earnings per share | $ 0.21 | $ 0.20 | $ 0.29 | |
[1] | The years ended December 31, 2014 and 2013 include $9,000 and $0.1 million, respectively, paid to Leucadia for administrative services. |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Consolidated Statements Of Comprehensive Income [Abstract] | |||
Net income | $ 5,126 | $ 5,000 | $ 7,108 |
Other comprehensive loss: | |||
Net unrealized holding losses on investments arising during the period, net of tax | (8) | (9) | (30) |
Comprehensive income | $ 5,118 | $ 4,991 | $ 7,078 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net cash flows from operating activities: | |||
Net income | $ 5,126 | $ 5,000 | $ 7,108 |
Adjustments to reconcile net income to net cash provided by operations: | |||
Depreciation and amortization of property and equipment | 5,913 | 5,555 | 5,343 |
Amortization of intangible assets | 1,514 | 1,514 | 1,514 |
Amortization of loan fees | 1 | ||
Leucadia National Corporation and its affiliates interest expense added to principal | 572 | ||
Loss on write-down of inventory | 288 | 517 | |
Provision for doubtful accounts | 17 | 4 | 3 |
Net gain related to disposals of property and equipment | (59) | (1,553) | (649) |
Deferred rent | (3) | 123 | |
Decrease in net deferred tax asset valuation allowance | (265) | (2,500) | |
Provision for deferred income taxes | 2,589 | 3,848 | |
Net change in: | |||
Accounts receivable | (354) | (644) | (646) |
Inventory | (6,331) | (5,817) | (1,232) |
Other current assets | (957) | 161 | (183) |
Other non-current assets | (108) | 6 | (309) |
Accounts payable and expense accruals | 1,095 | 576 | 1,177 |
Customer deposits | (18) | 75 | 99 |
Income taxes payable | (172) | 36 | |
Net cash provided by operating activities | 8,713 | 8,928 | 10,333 |
Net cash flows from investing activities: | |||
Purchase of investments available for sale | (36,479) | (9,500) | (10,500) |
Redemptions of investments available for sale | 26,729 | 4,250 | |
Acquisition of property and equipment | (8,632) | (7,664) | (6,534) |
Proceeds from disposals of property and equipment | 192 | 3,991 | 1,791 |
Net cash used in investing activities | (18,190) | (8,923) | (15,243) |
Net cash flows from financing activities: | |||
Proceeds from issuance of term loan | 16,000 | ||
Reduction of debt | (1,700) | ||
Equity contribution by Leucadia National Corporation | 14,175 | ||
Repurchase of common stock | (1,378) | ||
Payment of loan fees | (86) | ||
Net cash provided by financing activities | 14,536 | 12,475 | |
Net increase in cash and cash equivalents | 5,059 | 5 | 7,565 |
Cash and cash equivalents - beginning of period | 13,274 | 13,269 | 5,704 |
Cash and cash equivalents at December 31 | 18,333 | 13,274 | 13,269 |
Supplemental disclosure of cash flow information: | |||
Interest | 138 | 152 | 240 |
Income tax payments (refunds), net | 569 | 448 | 129 |
Non-cash investing and financing activity: | |||
Conversion of accrued interest to long-term debt | 572 | ||
Debt to equity conversion of upon spin off | 151,043 | ||
Unrealized holding gains on investments | (8) | $ (9) | $ (30) |
Capital Investments accrued but not yet paid | $ 342 |
Consolidated Statements Of Chan
Consolidated Statements Of Changes In Equity - USD ($) $ in Thousands | Common Shares $0.01 Par Value [Member] | Additional Paid-In-Capital [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated Deficit [Member] | Total |
Balance, at Dec. 31, 2012 | $ 245 | $ 112,302 | $ (86,714) | $ 25,833 | |
Net income | 7,108 | 7,108 | |||
Other comprehensive loss | $ (30) | (30) | |||
Cash capital contribution upon spin-off | 14,175 | 14,175 | |||
Debt conversion to equity upon spin-off | 151,043 | 151,043 | |||
Balance, at Dec. 31, 2013 | 245 | 277,520 | (30) | (79,606) | 198,129 |
Net income | 5,000 | 5,000 | |||
Other comprehensive loss | (9) | (9) | |||
Balance, at Dec. 31, 2014 | 245 | 277,520 | (39) | (74,606) | 203,120 |
Net income | 5,126 | 5,126 | |||
Other comprehensive loss | (8) | (8) | |||
Repurchase of common stock | (2) | (1,376) | (1,378) | ||
Balance, at Dec. 31, 2015 | $ 243 | $ 277,520 | $ (47) | $ (70,856) | $ 206,860 |
Explanatory Note
Explanatory Note | 12 Months Ended |
Dec. 31, 2015 | |
Explanatory Note [Abstract] | |
Explanatory Note | 1. Explanatory Note Crimson Wine Group, Ltd. (“Crimson”) is a Delaware corporation that has been operating since 1991. As used herein, the term “Company” refers to Crimson and its wholly-owned subsidiaries, except as the context may otherwise require. Prior to February 25, 2013, Crimson was a wholly-owned subsidiary of Leucadia National Corporation (“Leucadia”). On February 1, 2013, Leucadia declared a pro rata dividend of all of the outstanding shares of Crimson’s common stock in a manner that was structured to qualify as a tax-free spin-off for U.S. federal income tax purposes (the “Distribution”). Leucadia’s common shareholders received one share of Crimson common stock for every ten common shares of Leucadia ( 24,458,368 Crimson common shares in the aggregate), with cash in lieu of fractional shares, on February 25, 2013. The consolidated financial statements and notes thereto give retroactive effect to the Distribution for all periods presented. Crimson qualifies as an “emerging growth company” as defined in the JOBS Act. Crimson has elected to opt out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the JOBS Act. This election is irrevocable. |
Nature Of Operations
Nature Of Operations | 12 Months Ended |
Dec. 31, 2015 | |
Nature Of Operations [Abstract] | |
Nature Of Operations | 2. Nature of Operations The Company is in the business of producing and selling ultra-premium and luxury wines (i.e., wines that retail for $14 to $25 and over $25 per 750m l bottle, respectively). Crimson is headquartered in Napa, California and through its wholly-owned subsidiaries owns four wineries: Pine Ridge Vineyards, Archery Summit, Chamisal Vineyards and Seghesio Family Vineyards. Pine Ridge was acquired in 1991 and has been conducting operations since 1978, Crimson started Archery Summit in 1993, Chamisal Vineyards was acquired in 2008 and has been conducting operations since 1973, and Seghesio Family Vineyards was acquired in 2011 and has been conducting operations since 1895. Additionally, in 2005 and 2006 Crimson acquired Double Canyon vineyard land in the Horse Heaven Hills of Washington’s Columbia Valley. Since 2010, Double Canyon has produced wines in a third party custom crush facility. Crimson’s model is a combination of direct to consumer sales and wholesale distributor s ales. The Company’s wines are available through many principal retail channels for premium table wines, including fine wine restaurants, hotels, specialty shops, supermarkets and club stores, in all states domestically and in over 40 countries throughout the world. References to cases of wine herein refer to nine-liter equivalent cases. Pine Ridge Vineyards owns 158 acres and controls through leasing arrangements an additional 18 acres of estate vineyards in five Napa Valley appellations – Stags Leap District, Rutherford, Oakville, Carneros and Howell Mountain. Approximately 166 acres are currently planted and producing grapes. Archery Summit owns 1 01 acres and controls through leasing arrangements an additional 17 acres of estate vineyards in the Willamette Valley, Oregon. Approximately 112 acres are currently planted and producing grapes. Chamisal Vineyards owns 99 acres of vineyards in the Edna Valley, California, of which 82 acres are currently planted and producing grapes. Seghesio Family Vineyards owns 318 acres of vineyards in two Sonoma County appellations, the Alexander Valley and Russian River Valley, of which approximately 289 acres are currently planted and producing grapes. Double Canyon Vineyards owns 184 acres of vineyards in the Horse Heaven Hills of Washington, of which 91 acres are currently planted and producing grapes. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | 3. Significant Accounting Policies (a) Critical Accounting Estimates: The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of these financial statements requires the Company to make estimates and assumptions that affect the reported amounts in the financial statements and disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates all of these estimates and assumptions. The following areas have been identified as critical accounting estimates because they have the potential to have a significant impact on the Company's financial statements, and because they are based on assumptions which are used in the accounting records to reflect, at a specific point in time, events whose ultimate outcome won’t be known until a later date. Actual results could differ from these estimates. Inventory - Inventories are stated at the lower of cost or market, with cost being determined on the first-in, first-out method. Costs associated with winemaking, and other costs associated with the manufacturing of products for resale, are recorded as inventory. In accordance with general practice within the wine industry, wine inventories are included in current assets, although a portion of such inventories may be aged for periods longer than one year. As required, the Company reduces the carrying value of inventories that are obsolete or in excess of estimated usage to estimated net realizable value. The Company’s estimates of net realizable value are based on analyses and assumptions including, but not limited to, historical usage, future demand and market requirements. Reductions to the carrying value of inventories are recorded in cost of sales. If future demand and/or pricing for the Company’s products are less than previously estimated, then the carrying value of the inventories may be required to be reduced, resulting in additional expense and reduced profitability. Inventory write-downs of $0.3 million, $0.5 million and $0 were recorded during the years ended December 31, 2015, 2014 and 2013, respectively. Vineyard Development Costs – The Company capitalizes internal vineyard development costs when developing new vineyards or replacing or improving existing vineyards. These costs consist primarily of the costs of the vines and expenditures related to labor and materials to prepare the land and construct vine trellises. Amortization of such costs as annual crop costs is recorded on a straight-line basis over the estimated economic useful life of the vineyard, which can be as long as 25 years. As circumstances warrant, the Company re-evaluates the recoverability of capitalized costs, and will record impairment charges if required. The Company has not recorded any significant impairment charges for its vineyards during the last three years. Review of Long-lived Assets for Impairment - For intangible assets with definite lives, impairment testing is required if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and for goodwill, impairment testing is required at least annually or more frequently if events or circumstances indicate that these assets might be impaired. The Company currently has no intangible assets with indefinite lives. Substantially all of the Company’s goodwill and other intangible assets result from the acquisition of Seghesio Family Vineyards in May 2011. Amortization of intangible assets is recorded on a straight-line basis over the estimated useful lives of the assets, which range from 7 to 20 years. The Company evaluates goodwill for impairment at the end of each year, and has concluded that goodwill is not impaired. The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Long-lived assets consist primarily of property and equipment. Circumstances that might cause the Company to evaluate its long-lived assets for impairment could include a significant decline in the prices of the Company or the industry can charge for its products, which could be caused by general economic or other factors, changes in laws or regulations that make it difficult or more costly for the Company to distribute its products to its markets at prices which generate adequate returns, natural disasters, significant decrease in demand for the Company’s products or significant increase in the costs to manufacture the Company’s products. Recoverability of assets is measured by a comparison of the carrying amount of an asset group to future net cash flows expected to be generated by the asset group. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company groups its long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities (or asset group). This would typically be at the winery level which is described in Note 2 above. The Company did not recognize any impairment charges associated with long-lived assets during the three year period ended December 31, 2015. Depletion allowances - The Company pays depletion allowances to its distributors based on their sales to their customers. These allowances are estimated on a monthly basis by the Company, and allowances are accrued as a reduction of sales. Subsequently, distributors will bill the Company for actual depletions, which may be different from the Company’s estimate. Any such differences are recognized in sales when the bill is received. The Company has historically been able to estimate depletion allowances without any material differences between actual and estimated expense. (b) Consolidation policy: The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly-owned. All intercompany balances and transactions are eliminated in consolidation. (c) Cash and cash equivalents: The Company considers short-term investments, which have maturities of less than three months at the time of acquisition, to be cash equivalents. The Company had no short-term investments considered to be cash and cash equivalents at December 31, 2015 and 2014. (d) Financial instruments and fair value: Investments available for sale include a US Treasury Note and Certificates of Deposits at December 31, 2015, and Certificates of Deposit at December 31, 2014. All of the Company’s available for sale securities are either Level 1 or Level 2 and recorded at fair value. Available for sale securities that mature greater than 12 months from original investment are recorded as short-term because the securities represent the investment of funds that are available for current operations. Net unrealized gains and losses, net of tax, on available for sale securities are recorded in accumulated other comprehensive loss. Unrealized losses that are considered other than temporary are recorded in other income (expense) – net, with the corresponding reduction to the carrying basis of the investment. No other than temporary losses were recorded during the three year period ended December 31, 2015. Fair value hierarchy: In determining fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs reflect our assumptions that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. We apply a hierarchy to categorize our fair value measurements broken down into three levels based on the transparency of inputs as follows: Level 1: Quoted prices are available in active markets for identical assets or liabilities at the reported date. Level 2: Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these financial instruments include cash instruments for which quoted prices are available but traded less frequently, derivative instruments whose fair value have been derived using a model where inputs to the model are directly observable in the market, or can be derived principally from or corroborated by observable market data, and instruments that are fair valued using other financial instruments, the parameters of which can be directly observed. Level 3: Instruments that have little to no pricing observability at the reported date. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. Financial instruments are valued at quoted market prices, if available. Certain financial instruments have bid and ask prices that can be observed in the marketplace. For financial instruments whose inputs are based on bid-ask prices, the financial instrument is valued at the point within the bid-ask range that meets our best estimate of fair value. We use prices and inputs that are current at the measurement date. For financial instruments that do not have readily determinable fair values using quoted market prices, the determination of fair value is based upon consideration of available information, including types of financial instruments, current financial information, restrictions on dispositions, fair values of underlying financial instruments and quotations for similar instruments. The valuation of financial instruments may include the use of valuation models and other techniques. Adjustments to valuations derived from valuation models may be made when, in management’s judgment, features of the financial instrument such as its complexity, the market in which the financial instrument is traded and risk uncertainties about market conditions require that an adjustment be made to the value derived from the models. Adjustments from the price derived from a valuation model reflect management’s judgment that other participants in the market for the financial instrument being measured at fair value would also consider in valuing that same financial instrument. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. The availability of observable inputs can vary and is affected by a wide variety of factors, including, for example, the type of financial instrument and market conditions. As the observability of prices and inputs may change for a financial instrument from period to period, this condition may cause a transfer of an instrument among the fair value hierarchy levels. Transfers among the levels are recognized at the beginning of each period. The degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. (e) Accounts receivable: Accounts receivable are reported at net realizable value. The Company’s accounts receivable balance is net of an allowance for doubtful accounts of $0.1 million at December 31, 2015 and 2014. Interest is not accrued on past-due amounts. Accounts are charged against the allowance to bad debt as they are deemed uncollectible based upon a periodic review of the accounts. In evaluating the collectability of individual receivable balances, the Company considers several factors, including the age of the balance, the customer’s historical payment history, its current credit worthiness and current economic trends. (f) Property and equipment: Property and equipment are stated at cost and are depreciated using the straight-line method over the related assets estimated useful lives. Costs of maintenance and repairs are charged to expense as incurred; significant renewals and betterments are capitalized. Costs incurred developing vineyards are capitalized until the vineyard becomes commercially productive. (g) Loan fees: Fees incurred with the issuance of the Company’s debt are recorded in the consolidated balance sheets as a reduction to associated debt balances, consistent with the short-term or long-term classification of the related debt outstanding at the end of the reporting period . The Company amortizes debt discount to interest expense over the contractual or expected term of the debt using the effective interest method. (h) Concentrations of risk: The Company sells the majority of its wine through distributors and retailers. Receivables arising from these sales are not collateralized. During the year ended December 31, 2015, sales to two customers each accounted for approximately 15% and 10% of net sales, and in the years ended December 31, 2014 and 2013 sales to one customer accounted for approximately 15% and 14% of total sales, respectively. Amounts due from these customers represented approximately 45% and 32% of accounts receivable as of December 31, 2015 and 2014, respectively. The Company maintains its cash in bank deposit accounts that, at times, may exceed FDIC insurance thresholds. (i) Revenue recognition: The Company recognizes revenue from product sales upon shipment or delivery provided that persuasive evidence of an arrangement exists, which for sales to wholesalers is a purchase order, the price is fixed, title has transferred, collection of resulting receivables is reasonably assured, there are no customer acceptance requirements, and there are no remaining significant obligations. The cost of depletion allowances and price promotions are treated as reductions of revenues and can be reasonably estimated based upon experience. Revenue from products sold through retail locations, wine clubs and the internet is recognized when the product is received by the customer and payment is received, based on published retail prices and applicable published discounts. Revenue includes any shipping and handling costs billed to the customer, and such amounts are not expected to be sufficient to cover actual costs. (j) Cost of sales: Includes grape, juice and bulk wine costs, whether purchased or grown, crush costs, winemaking and processing costs, bottling, packaging, warehousing and shipping and handling costs. For vineyard produced grapes, grape costs include annual farming costs and amortization of vineyard development expenditures. For wines that age longer than one year, winemaking and processing costs continue to be incurred and capitalized to the cost of wine, which can range from 3 to 36 months. No further costs are allocated to inventory once the product is bottled and available for sale. (k) Taxes not on income: Excise taxes are levied by government agencies on the sale of alcoholic beverages, including wine. These taxes are not collected from customers but are instead the responsibility of the Company. Excise taxes of $1.1 million, $1.0 million and $1.0 million in the years ended December 31, 2015, 2014 and 2013, respectively, were recognized as a reduction to wine sales. Sales taxes that are collected from customers and remitted to governmental agencies are not reflected as revenues. (l) Advertising costs: Advertising costs are expensed as incurred and were $0.3 million, $0.2 million and $0.3 million for the years ended December 31, 2015, 2014 and 2013, respectively. (m) Income taxes: Income taxes are accounted for under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and the tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enacted date. Net tax assets are recorded to the extent the Company believes these assets will more likely than not be realized. In making such determination, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial results of operations. Prior to 2013, the Company had recorded a full valuation allowance related to its net deferred tax asset. As of December 31, 2013, the Company determined it was more likely than not that a portion of the deferred tax asset would be realized in the future, and therefore reduced the valuation allowance resulting in the recognition of a net deferred tax asset of $2.5 million. As of December 31, 2014, the Company determined it is more likely than not that the remaining allowance will be realized in the future, and therefore reduced the valuation allowance to zero and recognized the remaining $0.3 million as a portion of the deferred tax asset. Prior to the Distribution, the Company and its subsidiaries were included in the consolidated federal and certain consolidated or combined state income tax returns of Leucadia. However, the provisions for income taxes in the consolidated income statements have been determined on a theoretical separate-return basis. The Company does not have any unrecognized tax benefits; however, if it did the Company would record accrued interest and penalties related to unrecognized tax benefits as income tax expense. The Company records deferred income tax liabilities and assets as noncurrent in its consolidated balance sheets (see ‘Recent accounting pronouncements’ section within this footnote of Form 10-K for additional information on the adoption of this policy). See Note 12 for more detail on income tax for the Company. (n) Recent accounting pronouncements: In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) , which is guidance that changes the criteria for reporting discontinued operations. To qualify as a discontinued operation under the amended guidance, a component or group of components of an entity that has been disposed of or is classified as held for sale must represent a strategic shift that has or will have a major effect on the entity's operations and financial results. These changes became effective for the Company on January 1, 2015. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue fro m Contracts with Customers (Topic 606) , which is guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires an entity to recognize revenue when it transfers 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. Additionally, this guidance expands related disclosure requirements. This guidance becomes effective for the Company on January 1, 2018, and early adoption is permitted for the Company beginning on January 1, 2017. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40) , which requires management of a company to evaluate whether there is substantial doubt about the Company’s ability to continue as a going concern. This guidance becomes effective for the Company on January 1, 2017, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, Interest – Imputation of Interest (Subtopic 835-30) , which is guidance on the financial statement presentation of debt issuance costs. This guidance requires debt issuance costs to be presented in the balance sheet as a reduction of the related debt liability rather than an asset. In August 2015, the FASB issued ASU 2015-15, Interest-Imputation of Interest (Subtopic 835-30) , an update to clarify ASU 2015-03, which did not address the balance sheet presentation of debt issuance costs that are either (1) incurred before a debt liability is recognized (e.g. before the debt proceeds are received), or (2) associated with revolving debt arrangements. ASU 2015-15 states that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing deferred debt issuance costs ratably over the term of the LOC arrangement, regardless of whether there are outstanding borrowings under that LOC arrangement. This standard became effective upon issuance and should be adopted concurrent with the adoption of ASU 2015-03. The Company early adopted ASU 2015-03 and ASU 2015-15 for its annual and interim periods beginning January 1, 2015 and applied retrospective treatment of the standard. The adoption of these ASU’s resulted in $0.1 million of debt issuance costs related to the term loan issued in November 2015 to be recorded as a reduction of the related debt on the Company’s balance sheet as of December 31, 2015. The retrospective application had no impact on our balance sheet as of December 31, 2014. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330) , which is guidance on the simplification for the measurement of inventory. This guidance requires that an entity should measure in scope inventory at the lower of cost and net realizable value. This guidance becomes effective for the Company on January 1, 2017, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805) , relating to measurement-period adjustments in business combinations. The new standard eliminates the requirement for retrospective treatment of measurement-period adjustments in a business combination. Instead, a measurement-period adjustment will be recognized in the period in which the adjustment is determined. The guidance becomes effective for the Company on January 1, 2016, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) , which is guidance to simplify the presentation of deferred income taxes. The guidance requires that deferred income tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This guidance becomes effective for the Company on January 1, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. Guidance may be applied either prospectively, for all deferred tax assets and liabilities, or retrospectively (i.e., by reclassifying the comparative balance sheet). The Company early adopted ASU 2015-17 and applied retrospective treatment of the standard. The retrospective reclassification results in a reduction in current assets, total assets, non-current liabilities and total liabilities of $3.2 million as of December 31, 2014. In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10) , which is guidance related to accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The guidance becomes effective for the Company on January 1, 2018, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which is guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This guidance becomes effective for the Company on January 1, 2019. Early adoption of ASU 2016-02 as of its issuance is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2015 | |
Inventory [Abstract] | |
Inventory | 4. Inventory A summary of inventory at December 31, 2015 and 2014 is as follows (in thousands): December 31, 2015 December 31, 2014 Case wine $ 30,997 $ 25,613 In-process wine 24,306 23,630 Packaging and bottling supplies 333 350 Total inventory $ 55,636 $ 49,593 |
Property And Equipment
Property And Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property And Equipment [Abstract] | |
Property And Equipment | 5. Property and Equipment A summary of property and equipment at December 31, 2015 and 2014, and depreciation expense for the years ended December 31, 2015, 2014 and 2013, is as follows (in thousands): Depreciable Lives (in years) December 31, 2015 December 31, 2014 Land and improvements N/A $ 41,573 $ 41,573 Buildings and improvements 20 -40 48,770 45,259 Vineyards and improvements 7 -25 35,792 35,898 Winery and vineyard equipment 3 -25 29,766 25,437 Caves 20 -40 5,638 5,638 Vineyards under development N/A 2,001 1,894 Construction in progress N/A 195 633 Total 163,735 156,332 Accumulated depreciation and amortization (52,100) (47,625) Property and equipment, net $ 111,635 $ 108,707 Year ended December 31, 2015 2014 2013 Depreciation expense (in thousands): Capitalized into inventory $ 4,763 $ 4,601 $ 4,495 Expensed to general and administrative 1,150 954 848 Total depreciation $ 5,913 $ 5,555 $ 5,343 In January 2013, the Company sold a non-strategic vineyard for net cash consideration of $1.8 million, after selling expenses. The Company recorded a pre-tax gain of $0.7 million, net of closing costs, during the year ended December 31, 2013. In May 2014, the Company sold a non-strategic unplanted parcel of land in Washington for net proceeds of $3.9 million after selling expenses. The Company recorded a pre-tax gain of $1.8 million, net of closing costs, during the year ended December 31, 2014. |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments [Abstract] | |
Financial Instruments | 6. Financial Instruments The Company’s material financial instruments includ e cash and cash equivalents, investments classified as available for sale and short-term and long-term debt ; investments classified as available for sale are the only assets or liabilities that are measured at fair value on a recurring basis. All of the Company’s investments mature within three years or less. The par value, amortized cost, gross unrealized gains and losses and estimated fair value of investments classified as available for sale as of December 31, 2015 and 2014 are as follows (in thousands): December 31, 2015 Par Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Level 1 Level 2 Total Fair Value Measurements U.S. Treasury Note $ 10,000 $ 10,000 $ - $ (45) $ 9,955 $ - $ 9,955 Certificates of Deposit 15,500 15,500 4 (36) - 15,468 15,468 Total $ 25,500 $ 25,500 $ 4 $ (81) $ 9,955 $ 15,468 $ 25,423 December 31, 2014 Certificates of Deposit $ 15,750 $ 15,750 $ 7 $ (46) $ - $ 15,711 $ 15,711 Gross unrealized losses on available-for-sale securities were $0.1 million as of December 31, 2015, and the Company believes the gross unrealized losses are temporary as it does not intend to sell these securities and it is more likely than not that the Company will not be required to sell these securities before the recovery of their amortized cost basis. As of December 31, 2015 and 2014, the Company did not have any assets or liabilities measured at fair value on a nonrecurring basis. For cash and cash equivalents, the carrying amounts of such financial instruments approximate their fair values. For short-term and long-term debt, the carrying amounts of such financial instruments approximate their fair values. The Company has estimated the fair value of its short-term and long-term debt based upon discounted cash flows with Level 3 inputs, such as the terms that management believes would currently be available to the Company for similar issues of debt, taking into account the current credit risk of the Company and other factors. The Company does not invest in any derivatives or engage in any hedging activities. |
Intangible and Other Non-Curren
Intangible and Other Non-Current Assets | 12 Months Ended |
Dec. 31, 2015 | |
Intangible and Other Non-Current Assets [Abstract] | |
Intangible and Other Non-Current Assets | 7. Intangible and Other Non-Current Assets A summary of intangible and other non-current assets at December 31, 2015 and 2014 is as follows (in thousands): Amortizable Lives (in years) December 31, 2015 December 31, 2014 Brand, net of accumulated amortization of $4,717 and $3,688 17 $ 12,783 $ 13,812 Distributor relationships, net of accumulated amortization of $851 and $666 14 1,749 1,934 Customer relationships, net of accumulated amortization of $1,243 and $971 7 657 929 Legacy permits, net of accumulated amortization of $82 and $64 14 168 186 Trademark, net of accumulated amortization of $74 and $64 20 126 136 Total intangible assets, net 15,483 16,997 Other non-current assets 411 303 Total intangible and other non-current assets $ 15,894 $ 17,300 Amortization expense for each of the years ended December 31, 2015, 2014 and 2013 was $1.5 million. Estimated aggregate future amortization expense for intangible assets is as follows (in thousands): Years Remaining: Amortization 2016 $ 1,514 2017 1,514 2018 1,359 2019 1,243 2020 1,243 Thereafter 8,610 Total $ 15,483 |
Other Accrued Expenses
Other Accrued Expenses | 12 Months Ended |
Dec. 31, 2015 | |
Other Accrued Expenses [Abstract] | |
Other Accrued Expenses | 8. Other Accrued Expenses Other a ccrued expenses consisted of the following as of December 31, 2015 and 2014 (in thousands): December 31, 2015 December 31, 2014 Depletion allowance $ 977 $ 866 Production and farming 768 288 Sales and marketing 253 107 Other accrued expenses 586 5 Total other accrued expenses $ 2,584 $ 1,266 |
Due To Leucadia And Its Affilia
Due To Leucadia And Its Affiliates | 12 Months Ended |
Dec. 31, 2015 | |
Due To Leucadia And Its Affiliates [Abstract] | |
Due To Leucadia And Its Affiliates | 9. Due to Leucadia and its Affiliates Amounts that were due to Leucadia and its affiliates did bear interest at a specified bank prime rate plus 0.125% . All amounts were payable on demand, except for the $45.0 million note issued to Leucadia in connection with the acquisition of Seghesio Family Vineyards that was originally due May 13, 2013. Unpaid interest, if any, was added to the principal balance on a quarterly basis. Interest expense to Leucadia and its affiliates was $0 for the years ended December 31, 2015 and 2014 and was $0.8 million for the year ended December 31, 2013. On February 25, 2013, the remaining balance of due to affiliates was contributed by Leucadia to capital. Effective March 1, 2013, the Company entered into an administrative service agreement with Leucadia. Pursuant to this agreement, Leucadia provided certain administrative, SEC, tax filing and accounting services, including providing the services of the Company’s Corporate Secretary. Effective August 1, 2013, Leucadia and the Company agreed to amend the administrative service agreement to reduce the administrative services provided to the Company by Leucadia and to terminate the agreement effective February 2014. Administrative services expense was $0 , $9,000, and $0.1 million for the years ended December 31, 2015, 2014 and 2013, respectively. |
Stockholders_ Equity And Equity
Stockholders’ Equity And Equity Incentive Plan | 12 Months Ended |
Dec. 31, 2015 | |
Stockholders’ Equity And Equity Incentive Plan [Abstract] | |
Stockholders’ Equity And Equity Incentive Plan | 10. Stockholders’ Equity and Equity Incentive Plan On February 25, 2013, Crimson was recapitalized, authorized shares were increased to 150,000,000 common shares, $.01 par value, and Leucadia distributed 24,458,368 Crimson common shares to Leucadia shareholders. In addition, the Company is authorized to issue 15,000,000 shares of one or more series of preferred stock; no preferred stock has been issued. There were no dilutive or complex equity instruments or securities outstanding at any time during the periods presented. In February 2013, the Company adopted the 2013 Omnibus Incentive Plan, which provides for the granting of up to 1,000,000 stock options or other common stock based awards. The terms of awards that may be granted, including vesting and performance criteria, if any, will be determined by the Company’s board of directors. No awards have been granted to date. In March 2014, the Board of Directors of Crimson authorized a share repurchase program that provides for the repurchase of up to $2.0 million of outstanding common stock. Under the share repurchase program, any repurchased shares are constructively retired. As of December 31, 2015, the Company had repurchased 151,812 shares which were constructively retired at an original repurchase cost of $1.4 million. On February 29, 2016 the repurchase program was completed. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Debt | 11. Debt Revolving Credit Facility In March 2013, Crimson and its subsidiaries entered into a $60.0 million revolving credit facility with American AgCredit, FLCA, as agent for the lenders identified in the revolving credit facility, comprised of a revolving loan facility and a term revolving loan facility, which together is secured by substantially all of Crimson’s assets. The revolving credit facility is for up to $10.0 million of availability in the aggregate for a five year term, and the term revolving credit facility is for up to $50.0 million in the aggregate for a fifteen year term. All obligations of Crimson under the revolving credit facility are collateralized by certain real property, including vineyards and certain winery facilities of Crimson, accounts receivable, inventory and intangible assets . In addition to unused line fees ranging from 0.25% to 0.375% , rates for the borrowings are priced based on a performance grid tied to certain financial ratios and the London Interbank Offered Rate. Effective October 1, 2015 , the unused line fees range from 0.15% to 0.25% . The revolving credit facility can be used to fund acquisitions, capital projects and other general corporate purposes. Covenants include the maintenance of specified debt and equity ratios, limitations on the incurrence of additional indebtedness, limitations on dividends and other distributions to shareholders and restrictions on certain mergers, consolidations and sales of assets. No amounts have been borrowed under the revolving credit facility to date. Term Loan On November 10, 2015, Pine Ridge Winery, LLC (“Borrower”), a wholly-owned subsidiary of Crimson entered into a senior secured term loan agreement (the “term loan”) with American AgCredit, FLCA (“Lender”) for an aggregate principal amount of $16.0 million. Amounts outstanding under the term loan will bear a fixed interest rate of 5.24% per annum. The term loan will mature on October 1, 2040 (the “Maturity Date”). On the first day of each January, April, July and October, commencing January 1, 2016, a principal payment in the amount of $160,000 and an interest payment equal to the amount of all interest accrued through the previous day shall be made. A final payment of all unpaid principal, interest and any other charges with respect to the term loan shall be due and payable on the Maturity Date. The Company incurred debt issuance costs of approximately $0.1 million related to this term loan. These costs are recorded as a reduction from short-term or long-term debt, based on the timeframe in which the fees will be expensed (i.e. – expensed within 12-months shall be classified against short-term debt). The costs are being amortized to interest expense using the effective interest method over the contractual term of the loan. Borrower’s obligations under the term loan are guaranteed by the Company. All obligations of Borrower under the term loan are collateralized by certain real property of the Company. Borrower’s covenants include the maintenance of a specified debt service coverage ratio and certain customary affirmative and negative covenants, including limitations on the incurrence of additional indebtedness; limitations on distributions to shareholders; and restrictions on certain investments, sale of assets and merging or consolidating with other persons. Events of default under the term loan include, among others, the following: failure to make payments when due, breach of covenants, breach of representations or warranties, cessation of operations and the incurrence of certain environmental liabilities. In the case of any of the foregoing events of default, Lender may, but is not obligated to, accelerate all amounts due under the term loan and cause them to become immediately due and payable. In the case of an event of default arising from certain events of bankruptcy or insolvency, amounts due under the term loan will be accelerated and become immediately due and payable. The full $16.0 million was drawn at closing and the term loan can be used to fund acquisitions, capital projects and other general corporate purposes. As of December 31, 2015, $16.0 million in principal was outstanding, net of unamortized loan fees of $0.1 million. The Company was in compliance with all debt covenants as of December 31, 2015. A summary of debt maturity as of December 31, 2015 is as follows (in thousands): Principal due in 2016 $ 640 Principal due in 2017 640 Principal due in 2018 640 Principal due in 2019 640 Principal due in 2020 640 Principal due in 2021 and thereafter 12,800 Total $ 16,000 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | 12. Income Taxes The provision (benefit) for income taxes for years ended December 31, 2015, 2014 and 2013 are as follows (in thousands): 2015 2014 2013 State income taxes Current $ 107 $ 110 $ 75 Deferred 329 659 - Total state income taxes 436 769 75 Federal income taxes Current 140 166 90 Deferred 2,230 2,926 (2,500) Total federal income taxes 2,370 3,092 (2,410) Total $ 2,806 $ 3,861 $ (2,335) Prior to the Distribution, which was declared on February 1, 2013 with the shares distributed on February 25, 2013, the Company and its subsidiaries were included in the consolidated federal and certain consolidated or combined state income tax returns of Leucadia. However, the provisions for income taxes in the consolidated income statements were determined on a theoretical separate-return basis. Due to the Company’s history of pre-tax losses, as of the Distribution date the Company did not reflect a benefit for its net operating loss carryforwards (“NOLs”) since the Company was unable to conclude it was more likely than not that it would have been able to generate future taxable income to use the NOLs. As noted in Note 3, as of December 31, 2013 the Company determined that it was more likely than not that some of the tax benefit related to the deferred tax assets would be realized and reduced the valuation allowance , accordingly as of December 31, 2014, it was determined that it is more likely than not that the remaining allowance would be realized and the Company reduced the valuation allowance to zero. Prior to the Distribution, t he Company filed a California state income tax return separate from Leucadia. The Company's income tax returns are subject to examination in the U.S. federal and state jurisdictions. To the extent the Company has unutilized net operating loss carryforwards, the statute of limitations does not begin to run until the NOLs are utilized. Therefore , for federal and state tax purposes , the Company has tax years open dating back to 2002. The Company currently has no unrecognized tax benefits, and it is not reasonably possible to estimate the amount by which that could increase in the next twelve months since the timing of examinations, if any, is unknown. Prior to the Distribution, no formal tax sharing agreement was entered into between the Company and Leucadia. On the Distribution date, the Company and Leucadia entered into a tax matters agreement that governs the parties’ respective rights, responsibilities and obligations with respect to tax liabilities and benefits, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings and other matters regarding taxes. In general, with respect to any periods ending at or prior to the Distribution, Leucadia will be responsible for any federal income tax liabilities and any state or local income taxes reportable on a consolidated, combined or unitary return, in each case, as would be applicable to the Company as if it filed tax returns on a stand-alone basis. With respect to any periods beginning after the Distribution, the Company will be responsible for any federal, state or local income taxes of it or any of its subsidiaries. The Company will not be required to reimburse Leucadia for any payments made by Leucadia for adjustments to taxable periods prior to the Distribution, nor will the Company be entitled to any refunds for adjustments to taxable periods prior to the Distribution. The Company is responsible for any adjustments or liabilities related to its California state income tax return for all periods. The principal components of deferred taxes at December 31, 2015 and 2014 are as follows (in thousands): 2015 2014 Deferred tax asset Federal NOL carryover $ - $ 851 California NOL carryover 1,087 1,362 Federal AMT credit - 307 Inventory 2,132 1,602 Intangible assets and goodwill - 68 Other 321 327 Total deferred tax asset 3,540 4,517 Deferred tax liability Property and equipment (6,586) (5,600) Intangible assets and goodwill (596) - Total deferred tax liability (7,182) (5,600) Net deferred tax asset (liability), non-current $ (3,642) $ (1,083) Subsequent to the Distribution, the Company retained all of its California State NOLs; however, the Company retained federal NOLs only to the extent that they had not been previously used in Leucadia’s consolidated return. As of December 31, 2015, the Company has used all of its federal NOLs and $18.6 million of California State NOLs remain available for use. The expiration dates of California State NOLs are as follows (in thousands): State 2017 $ 2,254 2028-2032 16,373 Total $ 18,627 Under certain circumstances, the ability to use the NOLs and future deductions could be substantially reduced if certain changes in ownership were to occur. In order to reduce this possibility, the Company’s certificate of incorporation includes a charter restriction that prohibits transfers of the Company’s common stock under certain circumstances. The table below reconciles the expected statutory income tax rate to the actual income tax provision (benefit) (in thousands): 2015 2014 2013 Expected federal income tax expense (benefit) $ 2,697 $ 3,027 $ 1,671 State income tax expense 301 769 75 True-up of deferred tax balance (85) - - Use of net operating loss - - - Decrease in valuation allowance - (265) (2,500) Tax expense not provided on income recorded prior to reversal of deferred tax valuation allowance - - (1,581) Other, net (107) 330 - Total $ 2,806 $ 3,861 $ (2,335) |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2015 | |
Employee Benefit Plan [Abstract] | |
Employee Benefit Plan | 13. Employee Benefit Plan A 401(k) profit sharing plan is provided to all employees who meet certain service requirements. The Company matches 25% of a participant’s salary deferral, subject to regulatory limitations. Total C ompany contributions to the plan were $0.2 million for each of the years ended December 31, 2015, 2014 and 2013. |
Business Segment Information
Business Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Business Segment Information [Abstract] | |
Business Segment Information | 14. Business Segment Information The Company has identified two operating segments which are reportable segments for financial statement reporting purposes, Wholesale Sales and Direct to Consumer Sales, based upon their different distribution channels, margins and selling strategies. Wholesale Sales includes all sales through a third party where prices are given at a wholesale rate whereas Direct to Consumer Sales includes retail sales in the tasting room, remote sites and at on-site events, Wine Club sales and other sales made directly to the consumer without the use of an intermediary. The two segments reflect how the Company's operations are evaluated by senior management and the structure of its internal financial reporting. The Company evaluates performance based on the gross profit of the respective business segments. Selling expenses that can be directly attributable to the segment are allocated accordingly. However, centralized selling expenses and general and administrative expenses are not allocated between operating segments. Therefore, net income information for the respective segments is not available. Based on the nature of the Company’s business, revenue generating assets are utilized across segments. Therefore, discrete financial information related to segment assets and other balance sheet data is not available and that information continues to be aggregated. The following table outlines the net sales, cost of sales, gross profit, directly attributable selling expenses and operating income for the Company’s reportable segments for the years ended December 31, 2015, 2014 and 2013, and also includes a reconciliation of consolidated income (loss) from operations. Other/Non-allocable net sales and gross profit include bulk wine and grape sales, event fees and retail sales. Other/Non-allocable expenses include centralized corporate expenses not specific to an identified reporting segment. Sales figures are net of related excise taxes. Year Ended December 31, Wholesale Direct to Consumer Other/Non-Allocable Total (in thousands) 2015 2014 2013 2015 2014 2013 2015 2014 2013 2015 2014 2013 Net sales $ 36,253 $ 33,811 $ 32,612 $ 21,310 $ 20,343 $ 19,656 $ 3,414 $ 3,960 $ 4,204 $ 60,977 $ 58,114 $ 56,472 Cost of sales 18,927 17,247 18,080 6,064 6,066 7,262 3,455 3,857 4,343 28,446 27,170 29,685 Gross profit (loss) 17,326 16,564 14,532 15,246 14,277 12,394 (41) 103 (139) 32,531 30,944 26,787 Operating expenses: Sales and marketing 5,594 5,688 5,449 5,313 4,393 4,358 3,290 3,146 3,000 14,197 13,227 12,807 General and administrative* 10,543 10,249 9,270 10,543 10,249 9,270 Total operating expenses 5,594 5,688 5,449 5,313 4,393 4,358 13,833 13,395 12,270 24,740 23,476 22,077 Net gain on disposal of property and equipment - - - - - - (59) (1,553) (649) (59) (1,553) (649) Income (loss) from operations $ 11,732 $ 10,876 $ 9,083 $ 9,933 $ 9,884 $ 8,036 $ (13,815) $ (11,739) $ (11,760) $ 7,850 $ 9,021 $ 5,359 * The years ended December 31, 2014 and 2013 include $9,000 and $0.1 million, respectively, paid to Leucadia for administrative services . |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2015 | |
Commitments [Abstract] | |
Commitments | 15. Commitments The Company records rent expense under its lease agreements on a straight-line basis. Differences between actual lease payments and rent expense recognized under these leases results in a deferred rent liability at each reporting period. The Company has certain property lease agreements that expire through 2022 . These leases require annual base rent, supplemental rent based on the average market value of the grapes harvested, and certain operat ing expense payments. Future base rents required under these agreements are summarized as follows (in thousands): 2016 $ 273 2017 268 2018 274 2019 278 2020 131 Thereafter 2 Total $ 1,226 Base rent expense was $0.3 million, $49,000 and $26,000 for the years ended December 31, 2015, 2014 and 2013, respectively. Estimated supplemental rent payments, which are based on the market value of harvested grapes, are presented in the grape and bulk wine purchase commitments below. The Company has entered into long-term contracts through 2025 to purchase grapes and bulk wine from certain third parties and Seghesio family members who are employees of the Company. Total estimated commitments under these agreements are as follows (in thousands): Third Party Related Party 2016 $ 7,465 $ 596 2017 6,150 219 2018 2,757 437 2019 1,016 437 2020 927 437 Thereafter 2,664 656 Total $ 20,979 $ 2,782 The Company also purchases additional grapes and bulk wine under one-time purchase or short-term agreements. The total of all grapes and bulk wine purchased was $7.7 million, $7.6 million and $6.9 million for the years ended December 31, 2015, 2014 and 2013, respectively. Included in the totals of all grapes and bulk wine purchased are related party purchases of $0.6 million , $0.6 million and $0.5 million for the years ended December 31, 2015, 2014 and 2013, respectively. |
Litigation
Litigation | 12 Months Ended |
Dec. 31, 2015 | |
Litigation [Abstract] | |
Litigation | 16. Litigation The Company and its subsidiaries may become parties to legal proceedings that are considered to be either ordinary, routine litigation incidental to their business or not significant to the Company’s consolidated financial position or liquidity. The Company does not believe that there is any pending litigation that could have a significant adverse impact on its consolidated financial position, liquidity or results of operations. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Selected Quarterly Financial Data (Unaudited) [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | 1 7 . Selected Quarterly Financial Data (Unaudited) First Second Third Fourth (in thousands, except per share amounts) Quarter Quarter Quarter Quarter 2015 Net sales $ 13,717 $ 14,791 $ 14,023 $ 18,446 Gross profit $ 7,681 $ 8,089 $ 6,960 $ 9,801 Income from operations $ 1,950 $ 2,156 $ 830 $ 2,914 Net income $ 1,074 $ 1,542 $ 476 $ 2,034 Basic and fully diluted earnings per common share $ 0.04 $ 0.06 $ 0.02 $ 0.08 Number of shares used in calculation 24,458 24,458 24,452 24,367 2014 Net sales $ 13,272 $ 14,296 $ 12,844 $ 17,702 Gross profit $ 7,002 $ 8,197 $ 6,940 $ 8,805 Income from operations (a) $ 1,718 $ 3,782 $ 1,460 $ 2,061 Net income $ 944 $ 2,290 $ 699 $ 1,067 Basic and fully diluted earnings per common share $ 0.04 $ 0.09 $ 0.03 $ 0.04 Number of shares used in calculation 24,458 24,458 24,458 24,458 2013 Net sales $ 12,006 $ 15,221 $ 12,486 $ 16,759 Gross profit $ 5,619 $ 7,112 $ 6,067 $ 7,989 Income from operations (b) $ 1,660 $ 1,224 $ 480 $ 1,995 Net income $ 967 $ 1,245 $ 407 $ 4,489 Basic and fully diluted earnings per common share $ 0.04 $ 0.05 $ 0.02 $ 0.18 Number of shares used in calculation 24,458 24,458 24,458 24,458 (a) Income from operations in the quarterly periods for the year ended December 31, 2014 include s certain reclassifications that were made to conform to the current year’s presentation. (b) Net (gain)/loss on the disposal of property and equipment previously reported was reclassified as a component of income from operations to conform to current year's presentation . |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Event [Abstract] | |
Subsequent Event | 18. Subsequent event On January 27, 2016, one of Crimson’s wholly-owned subsidiaries entered into a purchase agreement pursuant to which Crimson’s subsidiary acquired, or has rights in, substantially all of the assets and certain liabilities with respect to the Seven Hills Winery located in Walla Walla, Washington. The acquisition provides a strategic opportunity for Crimson to expand its portfolio. The transition of the winery's operations remains subject to federal and state regulatory approvals. The acquisition-date fair value of the consideration transferred for the Seven Hills Winery acquisition totaled $7.9 million, consisting of $7.0 million in cash, which is subject to a working capital adjustment estimated at $0.3 million, and $0.6 million of contingent consideration. The contingent consideration arrangement requires the Company to pay up to $0.8 million in future earn-out payments based on certain achievements of the acquired business over the 38 months following the closing of the acquisition . The Company estimated the fair value of the contingent consideration using a probability-weighted discounted cash flow model. This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement as defined in ASC 820, Fair Value Measurement . The Seven Hills Winery acquisition will be recorded during the first quarter of 2016 using the acquisition method of accounting as prescribed under ASC 805, Business Combinations . Accordingly, assets acquired and liabilities assumed will be recorded at their fair values estimated by management as of January 27, 2016. The Company is in the process of finalizing fair value measurements of certain assets; thus, the measurements are subject to change. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date (in thousands): Accounts receivable $ 230 Inventory 3,500 Property, plant and equipment, net 3,030 Intangible Assets 1,000 Goodwill 850 Total assets 8,610 Accounts payable and accruals 170 Contingent liability 580 Total liabilities 750 Total purchase price $ 7,860 Adjustments to record the assets acquired and liabilities assumed at fair value include the recognition of $1.0 million of intangible assets as follows (in thousands, except estimated life information): Amount Estimated Life Tradename $ 700 13 to 15 years Distributor and customer relationships 300 8 to 10 years As described in Note 14 “Business Segment Information,” b ased on the nature of the Company’s business, revenue generating assets are utilized across segments. Therefore, goodwill recognized has not been allocated to any particular segment of the Company. Pro forma financial statements are not presented as they are not material to the Company’s overall financial statements. |
Significant Accounting Polici26
Significant Accounting Policies (Policy) | 12 Months Ended |
Dec. 31, 2015 | |
Significant Accounting Policies [Abstract] | |
Critical Accounting Estimates | Critical Accounting Estimates: The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The preparation of these financial statements requires the Company to make estimates and assumptions that affect the reported amounts in the financial statements and disclosures of contingent assets and liabilities. On an on-going basis, the Company evaluates all of these estimates and assumptions. The following areas have been identified as critical accounting estimates because they have the potential to have a significant impact on the Company's financial statements, and because they are based on assumptions which are used in the accounting records to reflect, at a specific point in time, events whose ultimate outcome won’t be known until a later date. Actual results could differ from these estimates. |
Inventory | Inventory - Inventories are stated at the lower of cost or market, with cost being determined on the first-in, first-out method. Costs associated with winemaking, and other costs associated with the manufacturing of products for resale, are recorded as inventory. In accordance with general practice within the wine industry, wine inventories are included in current assets, although a portion of such inventories may be aged for periods longer than one year. As required, the Company reduces the carrying value of inventories that are obsolete or in excess of estimated usage to estimated net realizable value. The Company’s estimates of net realizable value are based on analyses and assumptions including, but not limited to, historical usage, future demand and market requirements. Reductions to the carrying value of inventories are recorded in cost of sales. If future demand and/or pricing for the Company’s products are less than previously estimated, then the carrying value of the inventories may be required to be reduced, resulting in additional expense and reduced profitability. Inventory write-downs of $0.3 million, $0.5 million and $0 were recorded during the years ended December 31, 2015, 2014 and 2013, respectively. |
Vineyard Development Costs | Vineyard Development Costs – The Company capitalizes internal vineyard development costs when developing new vineyards or replacing or improving existing vineyards. These costs consist primarily of the costs of the vines and expenditures related to labor and materials to prepare the land and construct vine trellises. Amortization of such costs as annual crop costs is recorded on a straight-line basis over the estimated economic useful life of the vineyard, which can be as long as 25 years. As circumstances warrant, the Company re-evaluates the recoverability of capitalized costs, and will record impairment charges if required. The Company has not recorded any significant impairment charges for its vineyards during the last three years. |
Review of Long-Lived Assets for Impairment | Review of Long-lived Assets for Impairment - For intangible assets with definite lives, impairment testing is required if conditions exist that indicate the carrying value may not be recoverable. For intangible assets with indefinite lives and for goodwill, impairment testing is required at least annually or more frequently if events or circumstances indicate that these assets might be impaired. The Company currently has no intangible assets with indefinite lives. Substantially all of the Company’s goodwill and other intangible assets result from the acquisition of Seghesio Family Vineyards in May 2011. Amortization of intangible assets is recorded on a straight-line basis over the estimated useful lives of the assets, which range from 7 to 20 years. The Company evaluates goodwill for impairment at the end of each year, and has concluded that goodwill is not impaired. The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Long-lived assets consist primarily of property and equipment. Circumstances that might cause the Company to evaluate its long-lived assets for impairment could include a significant decline in the prices of the Company or the industry can charge for its products, which could be caused by general economic or other factors, changes in laws or regulations that make it difficult or more costly for the Company to distribute its products to its markets at prices which generate adequate returns, natural disasters, significant decrease in demand for the Company’s products or significant increase in the costs to manufacture the Company’s products. Recoverability of assets is measured by a comparison of the carrying amount of an asset group to future net cash flows expected to be generated by the asset group. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company groups its long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities (or asset group). This would typically be at the winery level which is described in Note 2 above. The Company did not recognize any impairment charges associated with long-lived assets during the three year period ended December 31, 2015. |
Depletion Allowances | Depletion allowances - The Company pays depletion allowances to its distributors based on their sales to their customers. These allowances are estimated on a monthly basis by the Company, and allowances are accrued as a reduction of sales. Subsequently, distributors will bill the Company for actual depletions, which may be different from the Company’s estimate. Any such differences are recognized in sales when the bill is received. The Company has historically been able to estimate depletion allowances without any material differences between actual and estimated expense. |
Consolidation Policy | Consolidation policy: The consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly-owned. All intercompany balances and transactions are eliminated in consolidation. |
Cash and Cash Equivalents | Cash and cash equivalents: The Company considers short-term investments, which have maturities of less than three months at the time of acquisition, to be cash equivalents. The Company had no short-term investments considered to be cash and cash equivalents at December 31, 2015 and 2014. |
Financial instrument and Fair Value | Financial instruments and fair value: Investments available for sale include a US Treasury Note and Certificates of Deposits at December 31, 2015, and Certificates of Deposit at December 31, 2014. All of the Company’s available for sale securities are either Level 1 or Level 2 and recorded at fair value. Available for sale securities that mature greater than 12 months from original investment are recorded as short-term because the securities represent the investment of funds that are available for current operations. Net unrealized gains and losses, net of tax, on available for sale securities are recorded in accumulated other comprehensive loss. Unrealized losses that are considered other than temporary are recorded in other income (expense) – net, with the corresponding reduction to the carrying basis of the investment. No other than temporary losses were recorded during the three year period ended December 31, 2015. Fair value hierarchy: In determining fair value, we maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from independent sources. Unobservable inputs reflect our assumptions that market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. We apply a hierarchy to categorize our fair value measurements broken down into three levels based on the transparency of inputs as follows: Level 1: Quoted prices are available in active markets for identical assets or liabilities at the reported date. Level 2: Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reported date. The nature of these financial instruments include cash instruments for which quoted prices are available but traded less frequently, derivative instruments whose fair value have been derived using a model where inputs to the model are directly observable in the market, or can be derived principally from or corroborated by observable market data, and instruments that are fair valued using other financial instruments, the parameters of which can be directly observed. Level 3: Instruments that have little to no pricing observability at the reported date. These financial instruments are measured using management’s best estimate of fair value, where the inputs into the determination of fair value require significant management judgment or estimation. Financial instruments are valued at quoted market prices, if available. Certain financial instruments have bid and ask prices that can be observed in the marketplace. For financial instruments whose inputs are based on bid-ask prices, the financial instrument is valued at the point within the bid-ask range that meets our best estimate of fair value. We use prices and inputs that are current at the measurement date. For financial instruments that do not have readily determinable fair values using quoted market prices, the determination of fair value is based upon consideration of available information, including types of financial instruments, current financial information, restrictions on dispositions, fair values of underlying financial instruments and quotations for similar instruments. The valuation of financial instruments may include the use of valuation models and other techniques. Adjustments to valuations derived from valuation models may be made when, in management’s judgment, features of the financial instrument such as its complexity, the market in which the financial instrument is traded and risk uncertainties about market conditions require that an adjustment be made to the value derived from the models. Adjustments from the price derived from a valuation model reflect management’s judgment that other participants in the market for the financial instrument being measured at fair value would also consider in valuing that same financial instrument. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. The availability of observable inputs can vary and is affected by a wide variety of factors, including, for example, the type of financial instrument and market conditions. As the observability of prices and inputs may change for a financial instrument from period to period, this condition may cause a transfer of an instrument among the fair value hierarchy levels. Transfers among the levels are recognized at the beginning of each period. The degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. |
Accounts Receivable | Accounts receivable: Accounts receivable are reported at net realizable value. The Company’s accounts receivable balance is net of an allowance for doubtful accounts of $0.1 million at December 31, 2015 and 2014. Interest is not accrued on past-due amounts. Accounts are charged against the allowance to bad debt as they are deemed uncollectible based upon a periodic review of the accounts. In evaluating the collectability of individual receivable balances, the Company considers several factors, including the age of the balance, the customer’s historical payment history, its current credit worthiness and current economic trends. |
Property And Equipment | Property and equipment: Property and equipment are stated at cost and are depreciated using the straight-line method over the related assets estimated useful lives. Costs of maintenance and repairs are charged to expense as incurred; significant renewals and betterments are capitalized. Costs incurred developing vineyards are capitalized until the vineyard becomes commercially productive. |
Loan fees | Loan fees: Fees incurred with the issuance of the Company’s debt are recorded in the consolidated balance sheets as a reduction to associated debt balances, consistent with the short-term or long-term classification of the related debt outstanding at the end of the reporting period . The Company amortizes debt discount to interest expense over the contractual or expected term of the debt using the effective interest method. |
Concentrations of Risk | Concentrations of risk: The Company sells the majority of its wine through distributors and retailers. Receivables arising from these sales are not collateralized. During the year ended December 31, 2015, sales to two customers each accounted for approximately 15% and 10% of net sales, and in the years ended December 31, 2014 and 2013 sales to one customer accounted for approximately 15% and 14% of total sales, respectively. Amounts due from these customers represented approximately 45% and 32% of accounts receivable as of December 31, 2015 and 2014, respectively. The Company maintains its cash in bank deposit accounts that, at times, may exceed FDIC insurance thresholds. |
Revenue Recognition | Revenue recognition: The Company recognizes revenue from product sales upon shipment or delivery provided that persuasive evidence of an arrangement exists, which for sales to wholesalers is a purchase order, the price is fixed, title has transferred, collection of resulting receivables is reasonably assured, there are no customer acceptance requirements, and there are no remaining significant obligations. The cost of depletion allowances and price promotions are treated as reductions of revenues and can be reasonably estimated based upon experience. Revenue from products sold through retail locations, wine clubs and the internet is recognized when the product is received by the customer and payment is received, based on published retail prices and applicable published discounts. Revenue includes any shipping and handling costs billed to the customer, and such amounts are not expected to be sufficient to cover actual costs. |
Cost of Sales | Cost of sales: Includes grape, juice and bulk wine costs, whether purchased or grown, crush costs, winemaking and processing costs, bottling, packaging, warehousing and shipping and handling costs. For vineyard produced grapes, grape costs include annual farming costs and amortization of vineyard development expenditures. For wines that age longer than one year, winemaking and processing costs continue to be incurred and capitalized to the cost of wine, which can range from 3 to 36 months. No further costs are allocated to inventory once the product is bottled and available for sale. |
Taxes Not on Income | Taxes not on income: Excise taxes are levied by government agencies on the sale of alcoholic beverages, including wine. These taxes are not collected from customers but are instead the responsibility of the Company. Excise taxes of $1.1 million, $1.0 million and $1.0 million in the years ended December 31, 2015, 2014 and 2013, respectively, were recognized as a reduction to wine sales. Sales taxes that are collected from customers and remitted to governmental agencies are not reflected as revenues. |
Advertising Costs | Advertising costs: Advertising costs are expensed as incurred and were $0.3 million, $0.2 million and $0.3 million for the years ended December 31, 2015, 2014 and 2013, respectively. |
Income Taxes | Income taxes: Income taxes are accounted for under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statements and the tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enacted date. Net tax assets are recorded to the extent the Company believes these assets will more likely than not be realized. In making such determination, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent financial results of operations. Prior to 2013, the Company had recorded a full valuation allowance related to its net deferred tax asset. As of December 31, 2013, the Company determined it was more likely than not that a portion of the deferred tax asset would be realized in the future, and therefore reduced the valuation allowance resulting in the recognition of a net deferred tax asset of $2.5 million. As of December 31, 2014, the Company determined it is more likely than not that the remaining allowance will be realized in the future, and therefore reduced the valuation allowance to zero and recognized the remaining $0.3 million as a portion of the deferred tax asset. Prior to the Distribution, the Company and its subsidiaries were included in the consolidated federal and certain consolidated or combined state income tax returns of Leucadia. However, the provisions for income taxes in the consolidated income statements have been determined on a theoretical separate-return basis. The Company does not have any unrecognized tax benefits; however, if it did the Company would record accrued interest and penalties related to unrecognized tax benefits as income tax expense. The Company records deferred income tax liabilities and assets as noncurrent in its consolidated balance sheets (see ‘Recent accounting pronouncements’ section within this footnote of Form 10-K for additional information on the adoption of this policy). See Note 12 for more detail on income tax for the Company. |
Recent Accounting Pronouncements | Recent accounting pronouncements: In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360) , which is guidance that changes the criteria for reporting discontinued operations. To qualify as a discontinued operation under the amended guidance, a component or group of components of an entity that has been disposed of or is classified as held for sale must represent a strategic shift that has or will have a major effect on the entity's operations and financial results. These changes became effective for the Company on January 1, 2015. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, Revenue fro m Contracts with Customers (Topic 606) , which is guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most current revenue recognition guidance. This guidance requires an entity to recognize revenue when it transfers 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. Additionally, this guidance expands related disclosure requirements. This guidance becomes effective for the Company on January 1, 2018, and early adoption is permitted for the Company beginning on January 1, 2017. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40) , which requires management of a company to evaluate whether there is substantial doubt about the Company’s ability to continue as a going concern. This guidance becomes effective for the Company on January 1, 2017, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, Interest – Imputation of Interest (Subtopic 835-30) , which is guidance on the financial statement presentation of debt issuance costs. This guidance requires debt issuance costs to be presented in the balance sheet as a reduction of the related debt liability rather than an asset. In August 2015, the FASB issued ASU 2015-15, Interest-Imputation of Interest (Subtopic 835-30) , an update to clarify ASU 2015-03, which did not address the balance sheet presentation of debt issuance costs that are either (1) incurred before a debt liability is recognized (e.g. before the debt proceeds are received), or (2) associated with revolving debt arrangements. ASU 2015-15 states that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing deferred debt issuance costs ratably over the term of the LOC arrangement, regardless of whether there are outstanding borrowings under that LOC arrangement. This standard became effective upon issuance and should be adopted concurrent with the adoption of ASU 2015-03. The Company early adopted ASU 2015-03 and ASU 2015-15 for its annual and interim periods beginning January 1, 2015 and applied retrospective treatment of the standard. The adoption of these ASU’s resulted in $0.1 million of debt issuance costs related to the term loan issued in November 2015 to be recorded as a reduction of the related debt on the Company’s balance sheet as of December 31, 2015. The retrospective application had no impact on our balance sheet as of December 31, 2014. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330) , which is guidance on the simplification for the measurement of inventory. This guidance requires that an entity should measure in scope inventory at the lower of cost and net realizable value. This guidance becomes effective for the Company on January 1, 2017, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805) , relating to measurement-period adjustments in business combinations. The new standard eliminates the requirement for retrospective treatment of measurement-period adjustments in a business combination. Instead, a measurement-period adjustment will be recognized in the period in which the adjustment is determined. The guidance becomes effective for the Company on January 1, 2016, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740) , which is guidance to simplify the presentation of deferred income taxes. The guidance requires that deferred income tax liabilities and assets be classified as noncurrent in a classified statement of financial position. This guidance becomes effective for the Company on January 1, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. Guidance may be applied either prospectively, for all deferred tax assets and liabilities, or retrospectively (i.e., by reclassifying the comparative balance sheet). The Company early adopted ASU 2015-17 and applied retrospective treatment of the standard. The retrospective reclassification results in a reduction in current assets, total assets, non-current liabilities and total liabilities of $3.2 million as of December 31, 2014. In January 2016, the FASB issued ASU 2016-01, Financial Instruments – Overall (Subtopic 825-10) , which is guidance related to accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The guidance becomes effective for the Company on January 1, 2018, and early adoption is permitted. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which is guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This guidance becomes effective for the Company on January 1, 2019. Early adoption of ASU 2016-02 as of its issuance is permitted. The new leases standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. Management is currently evaluating the potential impact of this guidance on the Company’s consolidated financial statements. |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Inventory [Abstract] | |
Summary Of Inventory | December 31, 2015 December 31, 2014 Case wine $ 30,997 $ 25,613 In-process wine 24,306 23,630 Packaging and bottling supplies 333 350 Total inventory $ 55,636 $ 49,593 |
Property And Equipment (Tables)
Property And Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property And Equipment [Abstract] | |
Summary Of Property And Equipment | Depreciable Lives (in years) December 31, 2015 December 31, 2014 Land and improvements N/A $ 41,573 $ 41,573 Buildings and improvements 20 -40 48,770 45,259 Vineyards and improvements 7 -25 35,792 35,898 Winery and vineyard equipment 3 -25 29,766 25,437 Caves 20 -40 5,638 5,638 Vineyards under development N/A 2,001 1,894 Construction in progress N/A 195 633 Total 163,735 156,332 Accumulated depreciation and amortization (52,100) (47,625) Property and equipment, net $ 111,635 $ 108,707 Year ended December 31, 2015 2014 2013 Depreciation expense (in thousands): Capitalized into inventory $ 4,763 $ 4,601 $ 4,495 Expensed to general and administrative 1,150 954 848 Total depreciation $ 5,913 $ 5,555 $ 5,343 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments [Abstract] | |
Schedule Of Available For Sale Securities | December 31, 2015 Par Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Level 1 Level 2 Total Fair Value Measurements U.S. Treasury Note $ 10,000 $ 10,000 $ - $ (45) $ 9,955 $ - $ 9,955 Certificates of Deposit 15,500 15,500 4 (36) - 15,468 15,468 Total $ 25,500 $ 25,500 $ 4 $ (81) $ 9,955 $ 15,468 $ 25,423 December 31, 2014 Certificates of Deposit $ 15,750 $ 15,750 $ 7 $ (46) $ - $ 15,711 $ 15,711 |
Intangible and Other Non-Curr30
Intangible and Other Non-Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Intangible and Other Non-Current Assets [Abstract] | |
Summary Of Intangible Assets | Amortizable Lives (in years) December 31, 2015 December 31, 2014 Brand, net of accumulated amortization of $4,717 and $3,688 17 $ 12,783 $ 13,812 Distributor relationships, net of accumulated amortization of $851 and $666 14 1,749 1,934 Customer relationships, net of accumulated amortization of $1,243 and $971 7 657 929 Legacy permits, net of accumulated amortization of $82 and $64 14 168 186 Trademark, net of accumulated amortization of $74 and $64 20 126 136 Total intangible assets, net 15,483 16,997 Other non-current assets 411 303 Total intangible and other non-current assets $ 15,894 $ 17,300 |
Amortization expense for Intangible Assets | Years Remaining: Amortization 2016 $ 1,514 2017 1,514 2018 1,359 2019 1,243 2020 1,243 Thereafter 8,610 Total $ 15,483 |
Other Accrued Expenses (Tables)
Other Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Accrued Expenses [Abstract] | |
Schedule of other accrued expenses | December 31, 2015 December 31, 2014 Depletion allowance $ 977 $ 866 Production and farming 768 288 Sales and marketing 253 107 Other accrued expenses 586 5 Total other accrued expenses $ 2,584 $ 1,266 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt [Abstract] | |
Summary of Debt Maturity | Principal due in 2016 $ 640 Principal due in 2017 640 Principal due in 2018 640 Principal due in 2019 640 Principal due in 2020 640 Principal due in 2021 and thereafter 12,800 Total $ 16,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Provision (Benefit) For Income Taxes | 2015 2014 2013 State income taxes Current $ 107 $ 110 $ 75 Deferred 329 659 - Total state income taxes 436 769 75 Federal income taxes Current 140 166 90 Deferred 2,230 2,926 (2,500) Total federal income taxes 2,370 3,092 (2,410) Total $ 2,806 $ 3,861 $ (2,335) |
Principal Components Of Deferred Taxes | 2015 2014 Deferred tax asset Federal NOL carryover $ - $ 851 California NOL carryover 1,087 1,362 Federal AMT credit - 307 Inventory 2,132 1,602 Intangible assets and goodwill - 68 Other 321 327 Total deferred tax asset 3,540 4,517 Deferred tax liability Property and equipment (6,586) (5,600) Intangible assets and goodwill (596) - Total deferred tax liability (7,182) (5,600) Net deferred tax asset (liability), non-current $ (3,642) $ (1,083) |
Schedule Of Operating Loss Carryforwards | State 2017 $ 2,254 2028-2032 16,373 Total $ 18,627 |
Schedule Of Effective Income Tax Reconciliation | 2015 2014 2013 Expected federal income tax expense (benefit) $ 2,697 $ 3,027 $ 1,671 State income tax expense 301 769 75 True-up of deferred tax balance (85) - - Use of net operating loss - - - Decrease in valuation allowance - (265) (2,500) Tax expense not provided on income recorded prior to reversal of deferred tax valuation allowance - - (1,581) Other, net (107) 330 - Total $ 2,806 $ 3,861 $ (2,335) |
Business Segment Information (T
Business Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Segment Information [Abstract] | |
Schedule Of Segment Reporting | Year Ended December 31, Wholesale Direct to Consumer Other/Non-Allocable Total (in thousands) 2015 2014 2013 2015 2014 2013 2015 2014 2013 2015 2014 2013 Net sales $ 36,253 $ 33,811 $ 32,612 $ 21,310 $ 20,343 $ 19,656 $ 3,414 $ 3,960 $ 4,204 $ 60,977 $ 58,114 $ 56,472 Cost of sales 18,927 17,247 18,080 6,064 6,066 7,262 3,455 3,857 4,343 28,446 27,170 29,685 Gross profit (loss) 17,326 16,564 14,532 15,246 14,277 12,394 (41) 103 (139) 32,531 30,944 26,787 Operating expenses: Sales and marketing 5,594 5,688 5,449 5,313 4,393 4,358 3,290 3,146 3,000 14,197 13,227 12,807 General and administrative* 10,543 10,249 9,270 10,543 10,249 9,270 Total operating expenses 5,594 5,688 5,449 5,313 4,393 4,358 13,833 13,395 12,270 24,740 23,476 22,077 Net gain on disposal of property and equipment - - - - - - (59) (1,553) (649) (59) (1,553) (649) Income (loss) from operations $ 11,732 $ 10,876 $ 9,083 $ 9,933 $ 9,884 $ 8,036 $ (13,815) $ (11,739) $ (11,760) $ 7,850 $ 9,021 $ 5,359 * The years ended December 31, 2014 and 2013 include $9,000 and $0.1 million, respectively, paid to Leucadia for administrative services |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments [Abstract] | |
Schedule Of Future Base Rents | 2016 $ 273 2017 268 2018 274 2019 278 2020 131 Thereafter 2 Total $ 1,226 |
Schedule Of Purchase Commitments | Third Party Related Party 2016 $ 7,465 $ 596 2017 6,150 219 2018 2,757 437 2019 1,016 437 2020 927 437 Thereafter 2,664 656 Total $ 20,979 $ 2,782 |
Selected Quarterly Financial 36
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Selected Quarterly Financial Data (Unaudited) [Abstract] | |
Schedule Of Quarterly Financial Data | First Second Third Fourth (in thousands, except per share amounts) Quarter Quarter Quarter Quarter 2015 Net sales $ 13,717 $ 14,791 $ 14,023 $ 18,446 Gross profit $ 7,681 $ 8,089 $ 6,960 $ 9,801 Income from operations $ 1,950 $ 2,156 $ 830 $ 2,914 Net income $ 1,074 $ 1,542 $ 476 $ 2,034 Basic and fully diluted earnings per common share $ 0.04 $ 0.06 $ 0.02 $ 0.08 Number of shares used in calculation 24,458 24,458 24,452 24,367 2014 Net sales $ 13,272 $ 14,296 $ 12,844 $ 17,702 Gross profit $ 7,002 $ 8,197 $ 6,940 $ 8,805 Income from operations (a) $ 1,718 $ 3,782 $ 1,460 $ 2,061 Net income $ 944 $ 2,290 $ 699 $ 1,067 Basic and fully diluted earnings per common share $ 0.04 $ 0.09 $ 0.03 $ 0.04 Number of shares used in calculation 24,458 24,458 24,458 24,458 2013 Net sales $ 12,006 $ 15,221 $ 12,486 $ 16,759 Gross profit $ 5,619 $ 7,112 $ 6,067 $ 7,989 Income from operations (b) $ 1,660 $ 1,224 $ 480 $ 1,995 Net income $ 967 $ 1,245 $ 407 $ 4,489 Basic and fully diluted earnings per common share $ 0.04 $ 0.05 $ 0.02 $ 0.18 Number of shares used in calculation 24,458 24,458 24,458 24,458 (a) Income from operations in the quarterly periods for the year ended December 31, 2014 include s certain reclassifications that were made to conform to the current year’s presentation. (b) Net (gain)/loss on the disposal of property and equipment previously reported was reclassified as a component of income from operations to conform to current year's presentation . |
Subsequent Event (Tables)
Subsequent Event (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Event [Abstract] | |
Summary of Assets Acquired and Liabilities Assumed | Accounts receivable $ 230 Inventory 3,500 Property, plant and equipment, net 3,030 Intangible Assets 1,000 Goodwill 850 Total assets 8,610 Accounts payable and accruals 170 Contingent liability 580 Total liabilities 750 Total purchase price $ 7,860 |
Schedule of Intangible Assets Acquired | Amount Estimated Life Tradename $ 700 13 to 15 years Distributor and customer relationships 300 8 to 10 years |
Eplanatory Note (Narrative) (De
Eplanatory Note (Narrative) (Details) - shares | Feb. 25, 2013 | Dec. 31, 2015 | Dec. 31, 2014 |
Explanatory Note [Abstract] | |||
Number of shares exchanged per one share issued | 10 | ||
Shares outstanding | 24,458,368 | 24,306,556 | 24,458,368 |
Nature of Operations (Narrative
Nature of Operations (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2015USD ($)acountryitem | |
Nature of Operations [Line Items] | |
Number of wineries owned | item | 4 |
Number of countries where wine is available | country | 40 |
Minimum [Member] | |
Nature of Operations [Line Items] | |
Price per bottle. mid range | $ | $ 14 |
Price per bottle. high range | $ | 25 |
Maximum [Member] | |
Nature of Operations [Line Items] | |
Price per bottle. mid range | $ | $ 25 |
Pine Ridge Vineyards [Member] | |
Nature of Operations [Line Items] | |
Acreage owned | 158 |
Acreage operated through leasing arrangements | 18 |
Acreage currently planted and producing grapes | 166 |
Number of appellations | item | 5 |
Archery Summit [Member] | |
Nature of Operations [Line Items] | |
Acreage owned | 101 |
Acreage operated through leasing arrangements | 17 |
Acreage currently planted and producing grapes | 112 |
Chamisal Vineyards [Member] | |
Nature of Operations [Line Items] | |
Acreage owned | 99 |
Acreage currently planted and producing grapes | 82 |
Seghesio Family Vineyards [Member] | |
Nature of Operations [Line Items] | |
Acreage owned | 318 |
Acreage currently planted and producing grapes | 289 |
Number of appellations | item | 2 |
Double Canyon Vineyards [Member] | |
Nature of Operations [Line Items] | |
Acreage of plantable land | 184 |
Acreage currently planted and producing grapes | 91 |
Significant Accounting Polici40
Significant Accounting Policies (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Significant Accounting Policies [Line Items] | |||
Inventory write-down | $ 288,000 | $ 517,000 | |
Short-term investments | 0 | 0 | |
Allowance for doubtful accounts | 100,000 | 100,000 | |
Significant impairment charges | 0 | 0 | $ 0 |
Other than temporary losses on investments available-for-sale securities | 0 | 0 | 0 |
Excise taxes | 1,100,000 | 1,000,000 | 1,000,000 |
Advertising costs | 300,000 | 200,000 | 300,000 |
Debt issuance cost | 100,000 | ||
Retrospective reclassification | 3,200,000 | ||
Valuation allowance | 0 | ||
Net deferred tax asset | $ 2,500,000 | ||
Deferred tax assets recognized | $ 300,000 | ||
Accounts Receivable [Member] | |||
Significant Accounting Policies [Line Items] | |||
Sales percentages | 45.00% | 32.00% | |
Vineyard [Member] | |||
Significant Accounting Policies [Line Items] | |||
Significant impairment charges | $ 0 | $ 0 | $ 0 |
Sales to One Customer [Member] | Total Sales [Member] | |||
Significant Accounting Policies [Line Items] | |||
Sales percentages | 15.00% | 14.00% | |
Sales to Customer One of Two [Member] | Total Sales [Member] | |||
Significant Accounting Policies [Line Items] | |||
Sales percentages | 15.00% | ||
Sales to Customer Two of Two [Member] | Total Sales [Member] | |||
Significant Accounting Policies [Line Items] | |||
Sales percentages | 10.00% | ||
Minimum [Member] | |||
Significant Accounting Policies [Line Items] | |||
Intangible assets useful life | 7 years | ||
Period which costs are capitalized | 3 months | ||
Maximum [Member] | |||
Significant Accounting Policies [Line Items] | |||
Intangible assets useful life | 20 years | ||
Period which costs are capitalized | 36 months | ||
Maximum [Member] | Vineyard [Member] | |||
Significant Accounting Policies [Line Items] | |||
Useful life | 25 years |
Inventory (Narrative) (Details)
Inventory (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Inventory [Line Items] | ||
Total inventory | $ 55,636 | $ 49,593 |
Case Wine [Member] | ||
Inventory [Line Items] | ||
Total inventory | 30,997 | 25,613 |
In-process Wine [Member] | ||
Inventory [Line Items] | ||
Total inventory | 24,306 | 23,630 |
Packaging And Bottling Supplies [Member] | ||
Inventory [Line Items] | ||
Total inventory | $ 333 | $ 350 |
Property And Equipment (Narrati
Property And Equipment (Narrative) (Details) - USD ($) $ in Millions | May. 31, 2014 | Jan. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Property And Equipment [Abstract] | ||||
Proceeds from sale of non-strategic vineyard | $ 3.9 | $ 1.8 | ||
Pre-tax gain on sale of vineyard | $ 1.8 | $ 0.7 |
Property And Equipment (Summary
Property And Equipment (Summary Of Property And Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 163,735 | $ 156,332 | |
Accumulated depreciation and amortization | (52,100) | (47,625) | |
Property and equipment, net | 111,635 | 108,707 | |
Depreciation capitalized into inventory | 4,763 | 4,601 | $ 4,495 |
Depreciation expensed to General and Administrative | 1,150 | 954 | 848 |
Total Depreciation | 5,913 | 5,555 | $ 5,343 |
Land And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 41,573 | 41,573 | |
Buildings And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 48,770 | 45,259 | |
Vineyards And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 35,792 | 35,898 | |
Winery And Vineyard Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 29,766 | 25,437 | |
Caves [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 5,638 | 5,638 | |
Vineyards Under Development [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 2,001 | 1,894 | |
Construction In Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 195 | $ 633 | |
Minimum [Member] | Buildings And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 20 years | ||
Minimum [Member] | Vineyards And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 7 years | ||
Minimum [Member] | Winery And Vineyard Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 3 years | ||
Minimum [Member] | Caves [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 20 years | ||
Maximum [Member] | Buildings And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 40 years | ||
Maximum [Member] | Vineyards And Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 25 years | ||
Maximum [Member] | Winery And Vineyard Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 25 years | ||
Maximum [Member] | Caves [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciable Lives | 40 years |
Financial Instruments (Narrativ
Financial Instruments (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 0 | $ 0 |
Liabilities measured at fair value | 0 | $ 0 |
Gross unrealized losses on available-for-sale securities | $ 0.1 | |
Maximum [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investment maturity period | 3 years |
Financial Instruments (Schedule
Financial Instruments (Schedule Of Available For Sale Securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Par Value | $ 25,500 | |
Amortized Cost | 25,500 | |
Gross Unrealized Gains | 4 | |
Gross Unrealized Losses | (81) | |
Total Fair Value Measurements | 25,423 | |
Level 1 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total Fair Value Measurements | 9,955 | |
Level 2 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total Fair Value Measurements | 15,468 | |
U.S. Treasury Note [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Par Value | 10,000 | |
Amortized Cost | 10,000 | |
Gross Unrealized Losses | (45) | |
Total Fair Value Measurements | 9,955 | |
U.S. Treasury Note [Member] | Level 1 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total Fair Value Measurements | 9,955 | |
Certificates Of Deposit [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Par Value | 15,500 | $ 15,750 |
Amortized Cost | 15,500 | 15,750 |
Gross Unrealized Gains | 4 | 7 |
Gross Unrealized Losses | (36) | (46) |
Total Fair Value Measurements | 15,468 | 15,711 |
Certificates Of Deposit [Member] | Level 2 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Total Fair Value Measurements | $ 15,468 | $ 15,711 |
Intangible and Other Non-Curr46
Intangible and Other Non-Current Assets (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Intangible and Other Non-Current Assets [Abstract] | |||
Amortization expense | $ 1,514 | $ 1,514 | $ 1,514 |
Intangible and Other Non-Curr47
Intangible and Other Non-Current Assets (Summary Of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Finite-Lived Intangible Assets [Line Items] | |||
Total intangible assets, net | $ 15,483 | $ 16,997 | |
Other non-current assets | 411 | 303 | |
Total intangible and other non-current assets | 15,894 | 17,300 | |
Amortization expense | $ 1,514 | 1,514 | $ 1,514 |
Brand [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortizable Lives | 17 years | ||
Total intangible assets, net | $ 12,783 | 13,812 | |
Accumulated amortization | $ 4,717 | 3,688 | |
Distributor Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortizable Lives | 14 years | ||
Total intangible assets, net | $ 1,749 | 1,934 | |
Accumulated amortization | $ 851 | 666 | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortizable Lives | 7 years | ||
Total intangible assets, net | $ 657 | 929 | |
Accumulated amortization | $ 1,243 | 971 | |
Legacy Permits [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortizable Lives | 14 years | ||
Total intangible assets, net | $ 168 | 186 | |
Accumulated amortization | $ 82 | 64 | |
Trademark [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortizable Lives | 20 years | ||
Total intangible assets, net | $ 126 | 136 | |
Accumulated amortization | $ 74 | $ 64 |
Intangible and Other Non-Curr48
Intangible and Other Non-Current Assets (Amortization expense for Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Intangible and Other Non-Current Assets [Abstract] | ||
2,016 | $ 1,514 | |
2,017 | 1,514 | |
2,018 | 1,359 | |
2,019 | 1,243 | |
2,020 | 1,243 | |
Thereafter | 8,610 | |
Total intangible assets, net | $ 15,483 | $ 16,997 |
Other Accrued Expenses (Schedul
Other Accrued Expenses (Schedule of other accrued expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other Accrued Expenses [Abstract] | ||
Depletion allowance | $ 977 | $ 866 |
Production and farming | 768 | 288 |
Sales and marketing | 253 | 107 |
Other accrued expenses | 586 | 5 |
Total other accrued expenses | $ 2,584 | $ 1,266 |
Due To Leucadia And Its Affil50
Due To Leucadia And Its Affiliates (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Related Party Transaction [Line Items] | |||
Interest expense related to Leucadia and its affiliates | $ 0 | $ 0 | $ 800 |
Administrative services fees to Leucadia National Corporation | $ 0 | $ 9 | $ 98 |
Bank Prime Rate [Member] | |||
Related Party Transaction [Line Items] | |||
Interest above prime rate | 0.125% | ||
Seghesio Family Vineyards [Member] | |||
Related Party Transaction [Line Items] | |||
Leucadia debt connected with acquisition | $ 45,000 |
Stockholders_ Equity And Equi51
Stockholders’ Equity And Equity Incentive Plan (Details) - USD ($) | 12 Months Ended | 36 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 28, 2013 | Feb. 25, 2013 | |
Stockholders’ Equity And Equity Incentive Plan [Abstract] | |||||
Preferred shares, authorized | 15,000,000 | ||||
Preferred shares, issued | 0 | 0 | |||
Dilutive or complex equity instruments or securities | $ 0 | ||||
stock options or other common stock based awards available for grant | 1,000,000 | ||||
Stock based awards granted | 0 | ||||
Share repurchase program amount authorized | $ 2,000,000 | $ 2,000,000 | |||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |
Common Stock, Shares, Issued | 24,306,556 | 24,306,556 | 24,458,368 | 24,458,368 | |
repurchased shares retired | 151,812 | ||||
Shares retired repurchase cost | $ 1,400,000 |
Debt (Narrative) (Details)
Debt (Narrative) (Details) - USD ($) | 1 Months Ended | 12 Months Ended | 31 Months Ended | |
Mar. 31, 2013 | Dec. 31, 2015 | Sep. 30, 2015 | Nov. 10, 2015 | |
Line of Credit Facility [Line Items] | ||||
Credit facility borrowing capacity | $ 60,000,000 | |||
Debt issuance cost | $ 100,000 | |||
Unamortized loan fees | 1,000 | |||
American AgCredit (FLCA) [Member] | Secured Debt [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Outstanding amount | $ 16,000,000 | |||
Principle amount | $ 16,000,000 | |||
Fixed interest rate | 5.24% | |||
Maturity date | Oct. 1, 2040 | |||
Principle payment | $ 160,000 | |||
Debt issuance cost | 100,000 | |||
Unamortized loan fees | 100,000 | |||
Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility borrowing capacity | $ 10,000,000 | |||
Credit facility term | 5 years | |||
Outstanding amount | $ 0 | |||
Term Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Credit facility borrowing capacity | $ 50,000,000 | |||
Credit facility term | 15 years | |||
Minimum [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Unused line fee | 0.15% | 0.25% | ||
Maximum [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Unused line fee | 0.25% | 0.375% |
Debt (Summary of Debt Maturity)
Debt (Summary of Debt Maturity) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Debt [Abstract] | |
Principal due in 2016 | $ 640 |
Principal due in 2017 | 640 |
Principal due in 2018 | 640 |
Principle due in 2019 | 640 |
Principle due in 2020 | 640 |
Principle due in 2021 and thereafter | 12,800 |
Total | $ 16,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Income Taxes [Line Items] | |
Valuation allowance | $ 0 |
California State [Member] | |
Income Taxes [Line Items] | |
Net operating loss | $ 18,627 |
Income Taxes (Provision (Benefi
Income Taxes (Provision (Benefit) For Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Abstract] | |||
Current State income taxes | $ 107 | $ 110 | $ 75 |
Deferred State income taxes | 329 | 659 | |
Total state income taxes | 436 | 769 | 75 |
Current Federal income taxes | 140 | 166 | 90 |
Deferred Federal income taxes | 2,230 | 2,926 | (2,500) |
Total federal income taxes | 2,370 | 3,092 | (2,410) |
Total | $ 2,806 | $ 3,861 | $ (2,335) |
Income Taxes (Principal Compone
Income Taxes (Principal Components Of Deferred Taxes) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Income Taxes [Abstract] | ||
Federal NOL carryover | $ 851 | |
California NOL carryover | $ 1,087 | 1,362 |
Federal AMT credit | 307 | |
Inventory | 2,132 | 1,602 |
Intangible assets and goodwill | 68 | |
Other | 321 | 327 |
Total deferred tax assets | 3,540 | 4,517 |
Property and equipment | (6,586) | (5,600) |
Intangible assets and goodwill | (596) | |
Total deferred tax liabilities | (7,182) | (5,600) |
Net deferred tax asset (liabillity), non-current | $ (3,642) | $ (1,083) |
Income Taxes (Schedule Of Opera
Income Taxes (Schedule Of Operating Loss Carryforwards) (Details) - California State [Member] $ in Thousands | Dec. 31, 2015USD ($) |
Operating Loss Carryforwards [Line Items] | |
2,017 | $ 2,254 |
2028-2032 | 16,373 |
Total | $ 18,627 |
Income Taxes (Schedule Of Effec
Income Taxes (Schedule Of Effective Income Tax Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Abstract] | |||
Expected federal income tax expense (benefit) | $ 2,697 | $ 3,027 | $ 1,671 |
State income tax expense | 301 | 769 | 75 |
True-up of deferred tax balance | (85) | ||
Decrease in valuation allowance | (265) | (2,500) | |
Tax expense not provided on income recorded prior to reversal of deferred tax | (1,581) | ||
Other, net | (107) | 330 | |
Total | $ 2,806 | $ 3,861 | $ (2,335) |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Employee Benefit Plan [Abstract] | |||
Percentage of participant’s salary eligible for match | 25.00% | ||
Total company contributions | $ 0.2 | $ 0.2 | $ 0.2 |
Business Segment Information (N
Business Segment Information (Narrative) (Details) | 12 Months Ended |
Dec. 31, 2015segment | |
Business Segment Information [Abstract] | |
Number of Operating Segments | 2 |
Business Segment Information (S
Business Segment Information (Schedule Of Segment Reporting) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |||
Segment Reporting Information [Line Items] | |||||||||||||||||
Net sales | $ 18,446 | $ 14,023 | $ 14,791 | $ 13,717 | $ 17,702 | $ 12,844 | $ 14,296 | $ 13,272 | $ 16,759 | $ 12,486 | $ 15,221 | $ 12,006 | $ 60,977 | $ 58,114 | $ 56,472 | ||
Cost of sales | 28,446 | 27,170 | 29,685 | ||||||||||||||
Gross profit (loss) | $ 9,801 | $ 6,960 | $ 8,089 | $ 7,681 | $ 8,805 | $ 6,940 | $ 8,197 | $ 7,002 | $ 7,989 | $ 6,067 | $ 7,112 | $ 5,619 | 32,531 | 30,944 | 26,787 | ||
Sales and marketing | 14,197 | 13,227 | 12,807 | ||||||||||||||
General and administrative | 10,543 | [1] | 10,240 | 9,172 | |||||||||||||
General and administrative including fee | [1] | 10,249 | 9,270 | ||||||||||||||
Total operating expense | 24,740 | 23,476 | 22,077 | ||||||||||||||
Net gain on disposal of property and equipment | (59) | (1,553) | (649) | ||||||||||||||
Income (loss) from operations | 7,850 | 9,021 | 5,359 | ||||||||||||||
Administrative services fees to Leucadia National Corporation | 0 | 9 | 98 | ||||||||||||||
Wholesale [Member] | |||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||
Net sales | 36,253 | 33,811 | 32,612 | ||||||||||||||
Cost of sales | 18,927 | 17,247 | 18,080 | ||||||||||||||
Gross profit (loss) | 17,326 | 16,564 | 14,532 | ||||||||||||||
Sales and marketing | 5,594 | 5,688 | 5,449 | ||||||||||||||
Total operating expense | 5,594 | 5,688 | 5,449 | ||||||||||||||
Income (loss) from operations | 11,732 | 10,876 | 9,083 | ||||||||||||||
Direct to Consumer [Member] | |||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||
Net sales | 21,310 | 20,343 | 19,656 | ||||||||||||||
Cost of sales | 6,064 | 6,066 | 7,262 | ||||||||||||||
Gross profit (loss) | 15,246 | 14,277 | 12,394 | ||||||||||||||
Sales and marketing | 5,313 | 4,393 | 4,358 | ||||||||||||||
Total operating expense | 5,313 | 4,393 | 4,358 | ||||||||||||||
Income (loss) from operations | 9,933 | 9,884 | 8,036 | ||||||||||||||
Other/Non-Allocable [Member] | |||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||
Net sales | 3,414 | 3,960 | 4,204 | ||||||||||||||
Cost of sales | 3,455 | 3,857 | 4,343 | ||||||||||||||
Gross profit (loss) | (41) | 103 | (139) | ||||||||||||||
Sales and marketing | 3,290 | 3,146 | 3,000 | ||||||||||||||
General and administrative | [1] | 10,543 | 10,249 | 9,270 | |||||||||||||
Total operating expense | 13,833 | 13,395 | 12,270 | ||||||||||||||
Net gain on disposal of property and equipment | (59) | (1,553) | (649) | ||||||||||||||
Income (loss) from operations | $ (13,815) | $ (11,739) | $ (11,760) | ||||||||||||||
[1] | The years ended December 31, 2014 and 2013 include $9,000 and $0.1 million, respectively, paid to Leucadia for administrative services. |
Commitments (Narrative) (Detail
Commitments (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Leased Assets [Line Items] | |||
Lease agreement expiration year | 2,022 | ||
Base rent expense | $ 300,000 | $ 49,000 | $ 26,000 |
Purchase commitments expiration year | 2,025 | ||
Amounts purchased under agreements | $ 7,700,000 | 7,600,000 | 6,900,000 |
Related Party [Member] | |||
Operating Leased Assets [Line Items] | |||
Amounts purchased under agreements | $ 600,000 | $ 600,000 | $ 500,000 |
Commitments (Schedule Of Future
Commitments (Schedule Of Future Base Rents ) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Commitments [Abstract] | |
2,016 | $ 273 |
2,017 | 268 |
2,018 | 274 |
2,019 | 278 |
2,020 | 131 |
Thereafter | 2 |
Total | $ 1,226 |
Commitments (Schedule Of Purcha
Commitments (Schedule Of Purchase Commitments) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Third Party [Member] | |
Long-term Purchase Commitment [Line Items] | |
2,016 | $ 7,465 |
2,017 | 6,150 |
2,018 | 2,757 |
2,019 | 1,016 |
2,020 | 927 |
Thereafter | 2,664 |
Total | 20,979 |
Related Party [Member] | |
Long-term Purchase Commitment [Line Items] | |
2,016 | 596 |
2,017 | 219 |
2,018 | 437 |
2,019 | 437 |
2,020 | 437 |
Thereafter | 656 |
Total | $ 2,782 |
Selected Quarterly Financial 65
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |||||||||
Selected Quarterly Financial Data (Unaudited) [Abstract] | |||||||||||||||||||||||
Net sales | $ 18,446 | $ 14,023 | $ 14,791 | $ 13,717 | $ 17,702 | $ 12,844 | $ 14,296 | $ 13,272 | $ 16,759 | $ 12,486 | $ 15,221 | $ 12,006 | $ 60,977 | $ 58,114 | $ 56,472 | ||||||||
Gross Profit | 9,801 | 6,960 | 8,089 | 7,681 | 8,805 | 6,940 | 8,197 | 7,002 | 7,989 | 6,067 | 7,112 | 5,619 | 32,531 | 30,944 | 26,787 | ||||||||
Income from operations | 2,914 | 830 | 2,156 | 1,950 | 2,061 | [1] | 1,460 | [1] | 3,782 | [1] | 1,718 | [1] | 1,995 | [2] | 480 | [2] | 1,224 | [2] | 1,660 | [2] | 7,932 | 8,861 | 4,773 |
Net income | $ 2,034 | $ 476 | $ 1,542 | $ 1,074 | $ 1,067 | $ 699 | $ 2,290 | $ 944 | $ 4,489 | $ 407 | $ 1,245 | $ 967 | $ 5,126 | $ 5,000 | $ 7,108 | ||||||||
Basic and fully diluted earnings per common share | $ 0.08 | $ 0.02 | $ 0.06 | $ 0.04 | $ 0.04 | $ 0.03 | $ 0.09 | $ 0.04 | $ 0.18 | $ 0.02 | $ 0.05 | $ 0.04 | $ 0.21 | $ 0.20 | $ 0.29 | ||||||||
Number of shares used in calculation | 24,367 | 24,452 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,458 | 24,434 | 24,458 | 24,458 | ||||||||
[1] | Income from operations in the quarterly periods for the year ended December 31, 2014 includes certain reclassifications that were made to conform to the current year's presentation. | ||||||||||||||||||||||
[2] | Net (gain)/loss on the disposal of property and equipment previously reported was reclassified as a component of income from operations to conform to current year's presentation |
Subsequent Event (Narrative) (D
Subsequent Event (Narrative) (Details) - Seven Hills Winery [Member] - Subsequent Event [Member] $ in Thousands | Jan. 27, 2016USD ($) |
Subsequent Event [Line Items] | |
Total purchase price | $ 7,860 |
Cash purchase price | 7,000 |
Working capital adjustment | 300 |
Contingent consideration | 580 |
Future earn-out payment | $ 800 |
Period in which certain achievements affect the future earn-out payment | 38 months |
Intangible assets | $ 1,000 |
Subsequent Event (Summary of As
Subsequent Event (Summary of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Jan. 27, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | |||
Goodwill | $ 1,053 | $ 1,053 | |
Seven Hills Winery [Member] | Subsequent Event [Member] | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 230 | ||
Inventory | 3,500 | ||
Property, plant and equipment, net | 3,030 | ||
Intangible assets | 1,000 | ||
Goodwill | 850 | ||
Total assets | 8,610 | ||
Accounts payable and accruals | 170 | ||
Contingent liability | 580 | ||
Total liabilities | 750 | ||
Total purchase price | $ 7,860 |
Subsequent Event (Schedule of I
Subsequent Event (Schedule of Intangible Assets Acquired) (Details) - Seven Hills Winery [Member] - Subsequent Event [Member] $ in Thousands | Jan. 27, 2016USD ($) |
Tradename [Member] | |
Intangible assets | $ 700 |
Tradename [Member] | Minimum [Member] | |
Estimated Life | 13 years |
Tradename [Member] | Maximum [Member] | |
Estimated Life | 15 years |
Distributor and Customer Relationships [Member] | |
Intangible assets | $ 300 |
Distributor and Customer Relationships [Member] | Minimum [Member] | |
Estimated Life | 8 years |
Distributor and Customer Relationships [Member] | Maximum [Member] | |
Estimated Life | 10 years |