Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 17, 2018 | Jun. 30, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | NATURES SUNSHINE PRODUCTS INC | ||
Entity Central Index Key | 275,053 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 250,332 | ||
Entity Common Stock, Shares Outstanding | 19,016,130 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 42,910 | $ 32,284 |
Accounts receivable, net of allowance for doubtful accounts of $395 and $205, respectively | 8,888 | 7,738 |
Investments available for sale | 0 | 1,776 |
Assets held for sale | 998 | 521 |
Inventories | 44,047 | 47,597 |
Prepaid expenses and other | 5,666 | 4,585 |
Total current assets | 102,509 | 94,501 |
Property, plant and equipment, net | 69,106 | 73,272 |
Investment securities - trading | 1,980 | 1,391 |
Intangible assets, net | 709 | 976 |
Deferred income tax assets | 8,283 | 21,590 |
Other assets | 12,608 | 13,840 |
Total Assets | 195,195 | 205,570 |
Current liabilities: | ||
Accounts payable | 4,215 | 5,305 |
Accrued volume incentives and service fees | 18,774 | 16,264 |
Accrued liabilities | 24,980 | 24,400 |
Deferred revenue | 3,348 | 3,672 |
Revolving credit facility | 0 | 9,919 |
Related party note | 506 | 0 |
Income taxes payable | 1,834 | 3,475 |
Total current liabilities | 53,657 | 63,035 |
Liability related to unrecognized tax benefits | 4,633 | 6,755 |
Long-term debt and revolving credit facility | 13,181 | 0 |
Deferred compensation payable | 1,980 | 1,391 |
Long-term deferred income tax liabilities | 770 | 0 |
Other liabilities | 1,242 | 1,991 |
Total liabilities | 75,463 | 73,172 |
Shareholders’ equity: | ||
Common stock, no par value; 50,000 shares authorized, 18,919 and 18,757 shares issued and outstanding as of December 31, 2017, and 2016, respectively | 131,525 | 129,654 |
Retained earnings (accumulated deficit) | (2,072) | 12,718 |
Noncontrolling interests | 411 | 1,286 |
Accumulated other comprehensive loss | (10,132) | (11,260) |
Total shareholders’ equity | 119,732 | 132,398 |
Total Liabilities and Shareholders' Equity | $ 195,195 | $ 205,570 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 395 | $ 205 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 18,919,000 | 18,757,000 |
Common stock, shares outstanding | 18,919,000 | 18,757,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net sales | $ 342,029 | $ 341,159 | $ 324,705 |
Cost of sales | (91,037) | (90,937) | (85,345) |
Gross profit | 250,992 | 250,222 | 239,360 |
Operating expenses: | |||
Volume incentives | 119,970 | 119,910 | 117,786 |
Selling, general and administrative | 129,635 | 120,273 | 107,702 |
Operating income | 1,387 | 10,039 | 13,872 |
Other income (expense): | |||
Interest and other income, net | 144 | 591 | 1,486 |
Interest expense | (289) | (16) | (130) |
Foreign exchange gains (losses), net | 1,980 | (1,348) | (1,948) |
Other income (expense), net | 1,835 | (773) | (592) |
Income from continuing operations before provision for income taxes | 3,222 | 9,266 | 13,280 |
Provision for income taxes | 17,039 | 8,591 | 1,740 |
Net income (loss) from continuing operations | (13,817) | 675 | 11,540 |
Income from discontinued operations | 0 | 0 | 2,116 |
Net income (loss) | (13,817) | 675 | 13,656 |
Net loss attributable to noncontrolling interests | (875) | (1,464) | (1,031) |
Net income (loss) attributable to common shareholders | $ (12,942) | $ 2,139 | $ 14,687 |
Basic earnings (loss) per share attributable to common shareholders: | |||
Net income (loss) from continuing operations (in dollars per share) | $ (0.69) | $ 0.11 | $ 0.67 |
Income from discontinued operations (in dollars per share) | 0 | 0 | 0.11 |
Net Income (loss) per common share attributable to shareholders (in dollars per share) | (0.69) | 0.11 | 0.79 |
Diluted earnings (loss) per share attributable to common shareholders: | |||
Net income (loss) from continuing operations (in dollars per share) | (0.69) | 0.11 | 0.66 |
Income from discontinued operations (in dollars per share) | 0 | 0 | 0.11 |
Net Income (loss) per common share attributable to shareholders (in dollars per share) | $ (0.69) | $ 0.11 | $ 0.77 |
Weighted average basic common shares outstanding (in shares) | 18,882 | 18,731 | 18,656 |
Weighted average diluted common shares outstanding (in shares) | 18,882 | 19,056 | 19,177 |
Dividends declared per common share (in dollars per share) | $ 0.10 | $ 0.4 | $ 0.4 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ (13,817) | $ 675 | $ 13,656 |
Foreign currency translation gain (loss) (net of tax) | 1,113 | (16) | 233 |
Net unrealized gains (losses) on investment securities (net of tax) | 15 | (1) | 22 |
Reclassification of net realized gains on marketable securities in net income (net of tax) | 0 | 0 | (294) |
Total comprehensive income (loss) | (12,689) | 658 | 13,617 |
Net loss attributable to noncontrolling interests | (875) | (1,464) | (1,031) |
Total comprehensive income (loss) attributable to common shareholders | $ (11,814) | $ 2,122 | $ 14,648 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Retained Earnings (Accumulated deficit) | Noncontrolling Interest | Accumulated Other Comprehensive Income (Loss) |
Balance at Dec. 31, 2014 | $ 128,957 | $ 125,489 | $ 10,891 | $ 3,781 | $ (11,204) |
Balance (in shares) at Dec. 31, 2014 | 18,662 | ||||
Increase (Decrease) in Shareholders' Equity | |||||
Share-based compensation expense | 4,485 | $ 4,485 | |||
Tax deficiency from exercise of stock options | (520) | $ (520) | |||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax (in shares) | 427 | ||||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax | 3,861 | $ 3,861 | |||
Repurchase of common stock | (6,645) | $ (6,645) | |||
Repurchase of common stock (in shares) | (501) | ||||
Cash dividends | (7,490) | (7,490) | |||
Net income (loss) | 13,656 | 14,687 | (1,031) | ||
Other comprehensive income (loss) | (39) | (39) | |||
Balance at Dec. 31, 2015 | 136,265 | $ 126,670 | 18,088 | 2,750 | (11,243) |
Balance (in shares) at Dec. 31, 2015 | 18,588 | ||||
Increase (Decrease) in Shareholders' Equity | |||||
Share-based compensation expense | 3,217 | $ 3,217 | |||
Tax deficiency from exercise of stock options | (233) | $ (233) | |||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax (in shares) | 169 | ||||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax | 0 | $ 0 | |||
Cash dividends | (7,509) | (7,509) | |||
Net income (loss) | 675 | 2,139 | (1,464) | ||
Other comprehensive income (loss) | (17) | (17) | |||
Balance at Dec. 31, 2016 | $ 132,398 | $ 129,654 | 12,718 | 1,286 | (11,260) |
Balance (in shares) at Dec. 31, 2016 | 18,757 | 18,757 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Share-based compensation expense | $ 2,218 | $ 2,218 | |||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax (in shares) | 162 | ||||
Shares issued from the exercise of stock options and vesting of restricted stock units, net of shares exchanged for withholding tax | (347) | $ (347) | |||
Cash dividends | (1,848) | (1,848) | |||
Net income (loss) | (13,817) | (12,942) | (875) | ||
Other comprehensive income (loss) | 1,128 | 1,128 | |||
Balance at Dec. 31, 2017 | $ 119,732 | $ 131,525 | $ (2,072) | $ 411 | $ (10,132) |
Balance (in shares) at Dec. 31, 2017 | 18,919 | 18,919 |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends (in dollars per share) | $ 0.10 | $ 0.40 | $ 0.4 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | $ (13,817) | $ 675 | $ 13,656 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Impairment of long-lived assets, net | 113 | 221 | 0 |
Provision for doubtful accounts | 215 | 305 | 21 |
Depreciation and amortization | 8,634 | 4,808 | 4,525 |
Share-based compensation expense | 2,218 | 3,217 | 4,485 |
(Gain) loss on sale of property and equipment | 284 | 149 | (2,703) |
Deferred income taxes | 14,134 | 766 | (3,373) |
Purchase of trading investment securities | (501) | (429) | (252) |
Proceeds from sale of trading investment securities | 151 | 147 | 239 |
Realized and unrealized gains on investments | (216) | (63) | (470) |
Foreign exchange losses (gains) | (1,980) | 1,348 | 1,948 |
Changes in assets and liabilities: | |||
Accounts receivable | (1,241) | (343) | (1,091) |
Inventories | 5,177 | (9,569) | 933 |
Prepaid expenses and other | (1,191) | 2,442 | 636 |
Other assets | 2,391 | (3,025) | (4,010) |
Accounts payable | (1,123) | (935) | 593 |
Accrued volume incentives and service fees | 1,884 | 1,477 | (1,427) |
Accrued liabilities | (986) | 1,519 | (3,451) |
Deferred revenue | (324) | (488) | (557) |
Income taxes payable | (1,758) | 1,924 | (914) |
Liability related to unrecognized tax positions | (2,129) | (1,076) | 1,368 |
Deferred compensation payable | 589 | 347 | 6 |
Net cash provided by operating activities | 10,524 | 3,417 | 10,162 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of property, plant and equipment | (5,501) | (11,028) | (22,527) |
Proceeds from sale of property, plant and equipment | 521 | 0 | 3,128 |
Purchases of investments available for sale | 0 | 0 | (3) |
Proceeds from sale/maturities of investments available for sale | 1,776 | 5 | 810 |
Purchase of intangible assets | 0 | (509) | 0 |
Net cash used in investing activities | (3,204) | (11,532) | (18,592) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Payments of cash dividends | (1,848) | (7,509) | (7,490) |
Proceeds from new revolving credit facility | 19,184 | 0 | 0 |
Principal payments of new revolving credit facility | (6,003) | 0 | 0 |
Net borrowings on original revolving credit facility | (9,919) | 7,223 | 2,696 |
Related party note | 506 | ||
Proceeds from exercise of stock options | (347) | 0 | 3,861 |
Repurchase of common stock | 0 | 0 | (6,645) |
Net cash provided by (used in) financing activities | 1,573 | (286) | (7,578) |
Effect of exchange rates on cash and cash equivalents | 1,733 | (735) | (1,271) |
Net increase (decrease) in cash and cash equivalents | 10,626 | (9,136) | (17,279) |
Cash and cash equivalents at beginning of the year | 32,284 | 41,420 | 58,699 |
Cash and cash equivalents at end of the year | 42,910 | 32,284 | 41,420 |
Supplemental disclosure of cash flow information: | |||
Cash paid for income taxes, net of refunds | 4,597 | 3,589 | 9,782 |
Cash paid for interest | 257 | 254 | 56 |
Supplemental disclosure of noncash investing and financing activities: | |||
Purchases of property, plant and equipment included in accounts payable and accrued liabilities | $ 63 | $ 178 | $ 1,081 |
NATURE OF OPERATIONS AND SIGNIF
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES | NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES Nature of Operations The Company is a natural health and wellness company primarily engaged in the manufacturing and direct selling of nutritional and personal care products. The Company is a Utah corporation with its principal place of business in Lehi, Utah, and sells its products to a sales force of independent distributors that uses the products themselves or resells them to consumers The Company markets its products in Australia, Austria, Belarus, Canada, China, Colombia, the Czech Republic, Denmark, the Dominican Republic, Ecuador, El Salvador, Finland, Germany, Guatemala, Honduras, Hong Kong, Iceland, Indonesia, Ireland, Italy, Japan, Kazakhstan, Latvia, Lithuania, Malaysia, Mexico, Moldova, Mongolia, the Netherlands, New Zealand, Norway, Panama, Poland, Russia, Singapore, Slovakia, Slovenia, South Korea, Spain, Sweden, Taiwan, Thailand, Ukraine, the United Kingdom and the United States. The Company also markets its products though a wholesale model to Australia, Brazil, Chile, Israel, New Zealand, Norway, Peru, Portugal, Spain and the United Kingdom. Principles of Consolidation The accompanying consolidated financial statements include the accounts and transactions of the Company and its subsidiaries. At December 31, 2017 and 2016 , substantially all of the Company’s subsidiaries were wholly owned. Intercompany balances and transactions have been eliminated in consolidation. The Company consolidates the joint ventures in Hong Kong and China in its consolidated financial statements, with another party's interest presented as a noncontrolling interest. Additionally, the Company operates a limited number of markets in jurisdictions where local laws require the formation of a partnership with an entity domiciled in that market. These partners have no rights to participate in the sharing of revenues, profits, losses or distribution of assets upon liquidation of these partnerships. Use of Estimates The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities, in these financial statements and accompanying notes. Actual results could differ from these estimates and those differences could have a material effect on the Company’s financial position and results of operations. The significant accounting estimates inherent in the preparation of the Company’s financial statements include estimates associated with its evaluation of impairment of long-lived assets, the determination of liabilities related to Manager and Distributor incentives, the determination of income tax assets and liabilities, certain other non-income tax and value-added tax contingencies, legal contingencies, and the valuation of investments. In addition, significant estimates form the basis for allowances with respect to inventory valuations and self-insurance liabilities associated with product liability and medical claims. Various assumptions and other factors enter into the determination of these significant estimates. The process of determining significant estimates takes into account historical experience and current and expected economic conditions. Cash and Cash Equivalents The Company considers all highly liquid short-term investments with original maturities of three months or less to be cash equivalents. Substantially all of the Company’s cash deposits either exceed the United States federally insured limit or are located in countries that do not have government insured accounts or are subject to tax withholdings when repatriating earnings. Accounts Receivable Accounts receivable consist principally of receivables from credit card companies, arising from the sale of products to the Company’s independent Distributors, and receivables from independent Distributors in foreign markets. Accounts receivable have been reduced by an allowance for amounts that may be uncollectible in the future. However, due to the geographic dispersion of credit card and Distributor receivables, the collection risk is not considered to be significant. Substantially all of the receivables from credit card companies were current as of December 31, 2017 and 2016 . Although receivables from independent Distributors can be significant, the Company performs ongoing credit evaluations of its independent Distributors and maintains an allowance for potential credit losses. This estimated allowance is based primarily on the aging category, historical trends and management’s evaluation of the financial condition of the customer. This reserve is adjusted periodically as information about specific accounts becomes available. Investment Securities The Company has certain investment securities classified as trading securities. The Company maintains its trading securities portfolio to generate returns that are offset by corresponding changes in certain liabilities related to the Company’s deferred compensation plans (see Note 13). The trading securities portfolio consists of marketable securities, which are recorded at fair value and are included in long-term investment securities on the consolidated balance sheets because they remain assets of the Company until they are actually paid out to the participants. These investment securities are not available to the Company to fund its operations as they are restricted for the payment of the deferred compensation payable. The Company has established a rabbi trust to finance obligations under the plan. Both realized and unrealized gains and losses on trading securities are included in interest and other income. Fair Value of Financial Instruments The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, investments, accounts payable approximate fair value due to their short-term nature. The carrying amount reflected on the condensed consolidated balance sheet for the revolving credit facility approximates fair value due to it being variable-rate debt. During the years ended December 31, 2017 , and 2016 , the Company did not have any write-offs related to the remeasurement of non-financial assets at fair value on a nonrecurring basis subsequent to their initial recognition. Inventories Inventories are stated at the lower-of-cost-or-market, using the first-in, first-out method. The components of inventory cost include raw materials, labor and overhead. To estimate any necessary obsolescence or lower-of-cost-or-market adjustments, various assumptions are made in regard to excess or slow-moving inventories, non-conforming inventories, expiration dates, current and future product demand, production planning and market conditions. Property, Plant and Equipment Property, plant and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Estimated useful lives for buildings range from 20 to 50 years; building improvements range from 7 to 10 years; machinery and equipment range from 2 to 10 years; computer software and hardware range from 3 to 10 years; and furniture and fixtures range from 2 to 5 years. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the related assets. Maintenance and repairs are expensed as incurred and major improvements are capitalized. The Company has made a significant investment in its information systems of approximately $48.5 million as of December 31, 2017 and began to amortize the asset over 10 years beginning April 2, 2017. Intangible Assets Intangible assets consist of purchased product formulations and product registrations. Such intangible assets are amortized using the straight-line method over the estimated economic lives of the assets of 9 to 15 years. Intangible assets, net of accumulated amortization, totaled $0.7 million and $1.0 million , at December 31, 2017 , and 2016 , respectively. Other Assets Other assets include lease deposits, deposits with third party service providers, deposits to operate in certain markets and potential foreign tax credit benefits related to the liability for unrecognized tax benefits. Impairment of Long-Lived Assets The Company reviews its long-lived assets, such as property, plant and equipment and intangible assets for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The Company uses an estimate of future undiscounted net cash flows of the related assets or groups of assets over their remaining lives in measuring whether the assets are recoverable. An impairment loss is calculated by determining the difference between the carrying values and the fair values of these assets. Incentive Trip Accrual The Company accrues for expenses associated with its direct sales program, which rewards independent Managers and Distributors with paid attendance for incentive trips, including Company conventions and meetings. Expenses associated with incentive trips are accrued over qualification periods as they are earned. The Company specifically analyzes incentive trip accruals based on historical and current sales trends as well as contractual obligations when evaluating the adequacy of the incentive trip accrual. Actual results could generate liabilities more or less than the amounts recorded. The Company has accrued convention and meeting costs of $5.0 million and $5.1 million at December 31, 2017 , and 2016 , respectively, which are included in accrued liabilities in the consolidated balance sheets. Foreign Currency Translation The local currency of the foreign subsidiaries is used as the functional currency, except for the Company’s operations are served by a U.S. based subsidiary (for example, Russia and Ukraine). The financial statements of foreign subsidiaries where the local currency is the functional currency are translated into U.S. dollars using exchange rates in effect at year end for assets and liabilities and average exchange rates during each year for the results of operations. Adjustments resulting from translation of financial statements are reflected in accumulated other comprehensive loss, net of income taxes. Foreign currency transaction gains and losses are included in other income (expense) in the consolidated statements of operations. The functional currency in highly inflationary economies is the U.S. dollar and transactions denominated in the local currency are re-measured as if the functional currency were the U.S. dollar. The remeasurement of local currencies into U.S. dollars creates translation adjustments, which are included in the consolidated statements of operations. A country is considered to have a highly inflationary economy if it has a cumulative inflation rate of approximately 100 percent or more over a three year period as well as other qualitative factors including historical inflation rate trends (increasing and decreasing), the capital intensiveness of the operation, and other pertinent economic factors. Revenue Recognition Net sales and related volume incentive expenses are recorded when persuasive evidence of an arrangement exists, collectability is reasonably assured, the amount is fixed and determinable, and title and risk of loss have passed. The amount of the volume incentive is determined based upon the amount of qualifying purchases in a given month. Amounts received for undelivered merchandise are recorded as deferred revenue. From time to time, the Company’s U.S. operations extend short-term credit associated with product promotions. In addition, for certain of the Company’s international operations, the Company offers credit terms consistent with industry standards within the country of operation. Payments to independent Managers and Distributors for sales incentives or rebates are recorded as a reduction of revenue. Payments for sales incentives and independent rebates are calculated monthly based upon qualifying sales. Membership fees are deferred and amortized as revenue over the life of the membership, primarily one year . Prepaid event registration fees are deferred and recognized as revenues when the related event is held. A reserve for product returns is recorded based upon historical experience. The Company allows independent Managers or Distributors to return the unused portion of products within ninety days of purchase if they are not satisfied with the product. In some of the Company’s markets, the requirements to return product are more restrictive. Sales returns for the years 2017 , 2016 and 2015 , were $1.6 million , $1.4 million , and $1.2 million , respectively. Amounts billed to customers for shipping and handling are reported as a component of net sales. Shipping and handling revenues of approximately $8.2 million , $9.2 million , and $9.2 million were reported as net sales for the years ended December 31, 2017 , 2016 , and 2015 , respectively. Taxes that have been assessed by governmental authorities and that are directly imposed on revenue-producing transactions between the Company and its customers, including sales, use, value-added, and some excise taxes, are presented on a net basis (excluded from net sales). Advertising Costs Advertising costs are expensed as incurred and classified in selling, general and administrative expenses. Advertising expense incurred for the years ended December 31, 2017 , 2016 , and 2015 totaled approximately $2.1 million , $1.9 million and $2.2 million , respectively. Research and Development All research and development costs are expensed as incurred and classified in selling, general and administrative expense. Total research and development expenses were approximately $3.4 million , $3.2 million , and $2.8 million in 2017 , 2016 , and 2015 , respectively. Contingencies The Company is involved in certain legal proceedings. When a loss is considered probable in connection with litigation or non-income tax contingencies and when such loss can be reasonably estimated, the Company records its best estimate within a range related to the contingency. If there is no best estimate, the Company records the minimum of the range. As additional information becomes available, the Company assesses the liability related to the contingency and revises the estimates. Revision in estimates of the liabilities could materially affect the Company's results of operations in the period of adjustment. The Company’s contingencies are discussed in further detail in Note 14. Income Taxes The Company’s income tax expense includes amounts related to the United States and many foreign jurisdictions and is comprised of current year income taxes payable, changes in its deferred tax assets and liabilities and contingent reserves. Deferred tax assets are offset by a valuation allowance if it is believed to be more likely than not that some portion of the deferred tax asset will not be fully realized. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (Tax Reform Act) which changes U.S. corporate income taxation in a number of significant ways including, but are not limited to, lowering the corporate income tax rate from 35% to 21%, implementing a quasi-territorial tax regime by providing a 100% Dividends Received Deduction (“DRD”) of foreign dividends, imposing a one-time transition tax on deemed repatriated post-1986 undistributed earnings of foreign subsidiaries and revising or eliminating certain deductions. The effect of some of the provisions of the Tax Reform Act are required to be recognized in the year of enactment, 2017, such as determining the transition tax and re-measuring deferred tax assets and liabilities. In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which provides guidance on accounting for the impact of the Tax Reform Act. See Note 11, Income Taxes, for more details regarding the Company’s income taxes and the impact of the Tax Reform Act. Net Income (Loss) Per Common Share Basic net income (loss) per common share (“Basic EPS”) is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. Following is a reconciliation of the numerator and denominator of Basic EPS to the numerator and denominator of Diluted EPS for all years (dollar and share amounts in thousands, except for per share information): 2017 2016 2015 Net income (loss) attributable to common shareholders: Net income (loss) from continuing operations $ (12,942 ) $ 2,139 $ 12,571 Income from discontinued operations $ — $ — $ 2,116 Net income (loss) $ (12,942 ) $ 2,139 $ 14,687 Basic weighted-average shares outstanding 18,882 18,731 18,656 Basic earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.67 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.79 Diluted Shares Outstanding Basic weighted-average shares outstanding 18,882 18,731 18,656 Stock-based awards — 325 521 Diluted weighted-average shares outstanding 18,882 19,056 19,177 Diluted earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.66 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.77 Potentially dilutive shares excluded from diluted-per-share amounts: Stock options — (1) 288 345 Potentially anti-dilutive shares excluded from diluted-per-share amounts: Stock options 2,118 (1) 1,347 688 (1) As a result of the net loss for the year ended December 31, 2017, no potentially dilutive securities are included in the calculation of diluted earnings (loss) per share because such effect would be anti-dilutive. Potentially dilutive securities include 1,390 outstanding options to purchase shares of common stock and 728 restricted stock units. Potentially dilutive shares excluded from diluted-per-share amounts include performance-based options to purchase shares of common stock, for which certain earnings metrics have not been achieved. Potentially anti-dilutive shares excluded from diluted-per-share amounts include both non-qualified stock options and unearned performance-based options to purchase shares of common stock with exercise prices greater than the weighted-average share price during the period and shares that would be anti-dilutive to the computation of diluted net income per share for each of the years presented. Share-Based Compensation The Company’s outstanding stock options include time-based stock options, which vest over differing periods ranging from the date of issuance up to 48 months from the option grant date; performance-based stock options, which have already vested upon achieving operating income margins of six , eight and ten percent as reported in four of five consecutive quarters over the term of the options. The Company’s outstanding restricted stock units ("RSUs") include time-based RSUs, which vest over differing periods ranging from 12 months up to 48 months from the RSU grant date, as well as performance-based RSUs, which vest upon achieving cumulative annual net sales growth targets over a rolling one year period and performance-based RSUs, which vest upon achieving earnings-per-share targets over a rolling one-year period. RSUs granted to the Board of Directors contain a restriction period in which the shares are not issued until two years after vesting. The Company recognizes all share-based payments to Directors and employees, including grants of stock options and restricted stock units, in the statement of operations based on their grant-date fair values. The Company records compensation expense, over the vesting period of the stock options and restricted stock units based on the fair value of the stock options and restricted stock units on the date of grant. Comprehensive Income (Loss) Comprehensive income (loss) includes all changes in shareholders’ equity except those resulting from investments by, and distributions to, shareholders. Accordingly, the Company’s comprehensive income (loss) includes net income (loss), net unrealized gains (losses) on investment securities, reclassifications of realized gains, and foreign currency adjustments that arise from the translation of the financial statements of the Company’s foreign subsidiaries. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 - Revenue from Contracts with Customers (Topic 606), and has subsequently issued ASUs 2015-14 - Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, 2016-08 - Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross Versus Net), 2016-10 - Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, 2016-12 - Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, and 2016-20 - Revenue from Contracts with Customers (Topic 606): Technical Corrections and Improvements to Topic 606 (collectively, Topic 606). Topic 606 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance is based on the principle that an entity should recognize revenue to depict the transfer of 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. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. This guidance is effective for the Company beginning on January 1, 2018, and provides the Company with the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. The Company adopted Topic 606 in January 2018 under a modified retrospective approach, under which the cumulative effect of initially applying Topic 606 is recognized as an adjustment to the opening balance of retained earnings. As a result of adopting Topic 606, the Company will, recognize revenue upon shipments to distributors net of sales reserves. The cumulative effect of adopting Topic 606 on January 1, 2018 was an increase to retained earnings of $0.8 million (net of tax). In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires that entities with a classified statement of financial position present all deferred tax assets and liabilities as non-current. This update was adopted during the first quarter of 2017 and applied on the retrospective basis. Other than the netting of current deferred tax assets of $5.6 million , which increased long-term deferred tax assets from $16.0 million to $21.6 million as of December 31, 2016, the adoption of this ASU did not have a material impact on the Company’s results of operations and consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This update amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Although the ASU retains many current requirements, it significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. This update is effective for interim and annual periods beginning after December 15, 2017. The adoption of this ASU is not expected to have a material impact on the Company’s results of operations, consolidated financial statements and footnote disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. This update specifies that lessees should recognize assets and liabilities arising from all leases, except for leases with a lease term of 12 months or less. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will largely remain unchanged and shall continue to depend on its classification as a finance or operating lease. The ASU will be effective for annual periods beginning after December 15, 2018 with early adoption permitted. The adoption of this ASU is not expected to have a material impact on the Company’s results of operations; however, it is expected to gross-up the consolidated balance sheet as a result of recognizing a lease asset along with a similar lease liability. In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. This update amends the scope of modification accounting surrounding share-based payment arrangements as issued in ASU 2016-09 by providing guidance on the various types of changes which would trigger modification accounting for share-based payment awards. ASU 2017-09 is effective for annual periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued. While the Company does not expect the adoption of ASU 2017-09 to have a material effect on its business, the Company is still evaluating any potential impact that adoption of ASU 2017-09 may have on its results of operations, consolidated financial statements and footnote disclosures. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS The following table summarizes the operating results of the Company’s discontinued operations (dollar amounts in thousands): 2015 Net sales $ — Income before income tax provision $ 2,604 Income tax provision 488 Income from discontinued operations $ 2,116 There was no income or losses from discontinued operations during the years ended December, 31, 2017 and 2016. During the year ended December 31, 2015, the Company received $1.3 million in net proceeds from the sales of its fixed assets in Venezuela, which is included in the results from discontinued operations. The Company ceased its operations in Venezuela in 2014. During the year ended December 31, 2015, the Company released $1.3 million in accrued liabilities related to prior sales and use taxes as well as other litigation in Brazil, which is included in the results from discontinued operations. The income from discontinued operations did not have a material impact on the Company’s operating cash flows during the year ended December 31, 2015. |
RESTRUCTURING RELATED EXPENSES
RESTRUCTURING RELATED EXPENSES | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING RELATED EXPENSES | RESTRUCTURING RELATED EXPENSES In April 2015, the Company announced its plan to streamline its operations and refocus its activities on profitable growth opportunities. The planned streamlining is expected to reduce costs, improve efficiencies and renew focus on larger and more profitable Company markets. As part of the plan, the Company eliminated approximately 100 positions worldwide through both severance and attrition. It also ceased operations in Vietnam and abandoned the lease for the building in that market. The Company incurred approximately $3.3 million of non-recurring expenses during the year ended December 31, 2015, which were recorded primarily in selling, general and administrative expenses, of which $2.8 million related to severance and termination benefits and $0.5 million related to other exit costs. In 2016, the Company decided to exit the Philippines and streamline its operations in Singapore. Total restructuring costs were $0.2 million for the year ended December 31, 2016, which were recorded primarily in selling, general and administrative expenses as well as in cost of goods sold. In continuing to execute the on-going strategy of focusing on larger and more profitable Company markets and in efforts to reduce costs and improve efficiencies, the Company executed a restructuring plan during the fourth quarter of 2017. As a part of the plan, the Company eliminated 60 positions worldwide through severance. It also ceased operations in the Costa Rica and Nicaragua markets, and closed the Los Angeles office. During the year ended December 31, 2017, the Company incurred approximately $1.5 million of non-recurring expenses that are recorded primarily in selling, general and administrative expenses consisting of severance, the write off of remaining lease costs net of contractual sublease payments, and of other market exit costs. Of the restructuring costs incurred during the year ended December 31, 2017, only $0.8 million of severance and rent costs remained payable at year-end. The following table summarizes the 2015, 2016, and 2017 restructuring activity: Total Liability balance at December 31, 2014 $ — Increase in liability 3,306 Reduction in liability (payments) (2,462 ) Liability balance at December 31, 2015 $ 844 Increase in liability 200 Reduction in liability (payments) (995 ) Liability balance at December 31, 2016 $ 49 Increase in liability 1,483 Reduction in liability (payments) (782 ) Liability balance at December 31, 2017 $ 750 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES The composition of inventories is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Raw materials $ 9,522 $ 14,995 Work in process 2,153 694 Finished goods 32,372 31,908 Total inventory $ 44,047 $ 47,597 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT The composition of property, plant and equipment is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Land and improvements $ 841 $ 1,996 Buildings and improvements 30,760 30,277 Machinery and equipment 25,160 23,699 Furniture and fixtures 20,385 19,962 Computer software and hardware 51,632 49,340 128,778 125,274 Accumulated depreciation and amortization (59,672 ) (52,002 ) Total property, plant and equipment $ 69,106 $ 73,272 Depreciation expense was $8.5 million , $4.7 million , and $4.4 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Capitalized interest was $0.1 million , $0.2 million , and $0 for the years ended December 31, 2017 , 2016 and 2015 , respectively. In January of 2017, the Company sold a 53 acre property in Springville, Utah. At December 31, 2016, $0.5 million of land and improvements was classified as held for sale and an impairment of $0.2 million was recognized for the year ended December 31, 2016. As of December 31, 2017, the Company reclassified an eight-acre property in Provo, Utah, as an asset held for sale. The Company originally acquired the property with the intent to erect a building for the corporate headquarters. As there is no intention to move the corporate headquarters to this location, Company management decided to sell the property. The property is currently under contract to sell. The Company anticipates the sale of the property to be completed during 2018. As the fair value of the property exceeds the carrying value, no loss was recognized during the year ended December 31, 2017. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS At December 31, 2017 , and 2016 , intangibles for product formulations and registrations had a gross carrying amount of $1.8 million , and $1.9 million , accumulated amortization of $1.1 million , and $0.9 million , and a net amount of $0.7 million , and $1.0 million , respectively. The estimated useful lives of the product formulations range from 9 to 15 years. During the year ended December 31, 2016, the Company purchased blue-hat product registrations of $0.5 million in China. The estimated useful lives of the blue-hat product registrations range from 3 to 5 years. Due to a reassessment of product demand, the Company took an impairment on the blue-hat product registrations of $0.1 million for the year ended December 31, 2017. Amortization expense for intangible assets for the years ended December 31, 2017 , 2016 , and 2015 was $0.2 million , $0.1 million and $0.1 million , respectively. Estimated amortization expense for the five succeeding years and thereafter is as follows (dollar amounts in thousands): Year Ending December 31, 2018 $ 186 2019 186 2020 186 2021 134 2022 17 Total $ 709 |
INVESTMENT SECURITIES
INVESTMENT SECURITIES | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENT SECURITIES | INVESTMENT SECURITIES The amortized cost and estimated fair values of available-for-sale securities are as follows (dollar amounts in thousands): As of December 31, 2016 Amortized Gross Gross Fair U.S. government securities funds $ 1,799 $ — $ (23 ) $ 1,776 Total short-term investment securities $ 1,799 $ — $ (23 ) $ 1,776 There were no available for sale securities as of December 31, 2017. During 2017 , 2016 , and 2015 , the proceeds from the sales of available-for-sale securities were $1.8 million , $5,000 , and $0.8 million , respectively. During the year ended December 31, 2016 , the Company had gross realized gains of $0.3 million on sales of available-for-sale securities (net of tax). There were zero realized gains (losses) on sales of available-for-sales securities (net of tax) for the year ended December 31, 2015 . The Company’s trading securities portfolio totaled $2.0 million and $1.4 million at December 31, 2017 and 2016 , respectively, and generated gains of $0.2 million , gains of $0.1 million , and losses of $5,000 , for the years ended December 31, 2017 , 2016 , and 2015 , respectively. |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES | ACCRUED LIABILITIES The composition of accrued liabilities is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Salaries and employee benefits $ 10,289 $ 10,670 Sales, use and property tax (See Note 14) 3,367 2,376 Convention and meeting costs 4,970 5,129 Other 6,354 6,225 Total $ 24,980 $ 24,400 |
REVOLVING CREDIT FACILITY
REVOLVING CREDIT FACILITY | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
REVOLVING CREDIT FACILITY | REVOLVING CREDIT FACILITY On July 11, 2017, the Company entered into a revolving credit agreement with Bank of America, N.A., with a borrowing limit of $25.0 million , that matures on July 11, 2020 (the “Bank of America Credit Agreement”). In connection with the closing of the Bank of America Credit Agreement, the Company terminated its revolving credit agreement with Wells Fargo Bank, N.A. (the "Wells Fargo Credit Agreement") and satisfied in full the outstanding balance thereof through borrowings on the Bank of America Credit Agreement. The Company pays interest on any borrowings under the Bank of America Credit Agreement at LIBOR plus 1.25 percent ( 2.82 percent as of December 31, 2017 ), and an annual commitment fee of 0.2 percent on the unused portion of the commitment. The Company is required to settle its net borrowings under the Bank of America Credit Agreement only upon maturity, and as a result, has classified its outstanding borrowings as non-current on its condensed consolidated balance sheet as of December 31, 2017. At December 31, 2017 , the outstanding balance under the Bank of America Credit Agreement was $13.2 million . The Bank of America Credit Agreement contains customary financial covenants, including financial covenants relating to the Company’s solvency, leverage, and minimum EBITDA. In addition, the Bank of America Credit Agreement restricts certain capital expenditures, lease expenditures, other indebtedness, liens on assets, guarantees, loans and advances, dividends, and merger, consolidation and the transfer of assets except as permitted in the Bank of America Credit Agreement. The Bank of America Credit Agreement is collateralized by the Company's manufacturing facility, accounts receivable balance, inventory balance and other assets. The Company was in compliance with the debt covenants set forth in the Bank of America Credit Agreement as of December 31, 2017 . Prior to the termination of the Wells Fargo Credit Agreement, the Company paid interest at LIBOR plus 1.25 percent ( 2.13 percent at December 31, 2016), and an annual commitment fee of 0.25 percent on the unused portion of the commitment. At December 31, 2016, the outstanding balance under the Wells Fargo Credit Agreement was $9.9 million . |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2017 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The components of accumulated other comprehensive income (loss), net of tax, are as follows (dollar amounts in thousands): Foreign Currency Translation Adjustments Net Unrealized Gains (Losses) On Available-For-Sale Securities Total Accumulated Other Comprehensive Loss Balance as of January 1, 2015 $ (11,464 ) $ 260 $ (11,204 ) Activity, net of tax 233 (272 ) (39 ) Balance as of December 31, 2015 (11,231 ) (12 ) (11,243 ) Activity, net of tax (16 ) (1 ) (17 ) Balance as of December 31, 2016 (11,247 ) (13 ) (11,260 ) Activity, net of tax 1,113 15 1,128 Balance as of December 31, 2017 $ (10,134 ) 2 $ (10,132 ) |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (Tax Reform Act) . The Tax Reform Act alters U.S. corporate income taxation in a number of significant ways including, lowering the corporate income tax rate from 35% to 21%, implementing a quasi-territorial tax regime by providing a 100% Dividends Received Deduction (“DRD”) of foreign dividends, imposing a one-time transition tax on deemed repatriated post-1986 undistributed earnings of foreign subsidiaries and revising or eliminating certain deductions. As a result of the large number of changes and the complexity of the changes resulting from the Tax Reform Act and given the lack of guidance provided thus far regarding the tax law changes, the Company has not finalized the accounting for income tax effects of the Tax Reform Act. The Securities and Exchange Commission Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), provides guidance on accounting for the impact of the Tax Reform Act. SAB 118 allows for a provisional estimate to be recognized in the financial statements relating to ASC 740 in instances where a company’s accounting for certain income tax effects of the Tax Reform Act is incomplete, but can be reasonably estimated. If a company is unable to reasonably estimate a provisional amount to be included in the financial statements, SAB 118 provides that it should continue to apply ASC 740 based on the provisions of the tax laws in effect immediately prior to the enactment of the Tax Reform Act. The Company has estimated it will not owe any transition tax; therefore, it has recorded no provisional amount related to the deemed repatriation of post-1986 undistributed earnings of foreign subsidiaries. The company has recorded a provisional amount of $9.9 million related to the establishment of a valuation allowance on deferred tax assets for foreign tax credits. Utilization of the company’s foreign tax credit carryforwards is expected to be significantly limited due to changes made by the Tax Reform Act on the way that foreign income is calculated and sourced. A provisional amount of $3.8 million has also been recorded relating to re-measurement of U.S. deferred tax assets and liabilities based on the new lower corporate income tax rate at which deferred taxes are expected to reverse in the future. This amount is provisional because while it is possible to reasonably estimate the impact of the rate reduction, it may be impacted by additional analysis related to the Tax Reform Act, including, but not limited to, return to accrual adjustments and the state tax effect of adjustments made to federal temporary differences. The Company is also in the process of analyzing the potential effects of several new provisions resulting from the Tax Reform Act that take effect in 2018 including, the Global Intangible Low-taxed Income (GILTI) tax, the Foreign-derived Intangible Income (FDII) deduction, the Base-erosion Anti-abuse Tax (BEAT), interest expense deduction limitations, executive compensation deduction limits and various other provisions. Due to the complexity of the new GILTI rules, the Company are continuing to evaluate the impact of this provision of the Tax Reform Act on the Company’s income tax reporting. U.S. accounting rules allow companies to adopt an accounting policy to recognize taxes due on future U.S. taxable income inclusions related to GILTI under either the period cost method or the deferred method. Under the period cost method, GILTI taxes are included as a current-period expense when incurred, whereas under the deferred method, these taxes would be included in the company’s measurement of its deferred taxes. The company is unable to reasonably estimate the effect of this provision of the Tax Reform Act at this time; therefore, no financial statement adjustments have been made with respect to potential GILTI taxes, nor has the Company made a policy decision regarding whether to record deferred taxes related to GILTI. Prior to enactment of the Tax Reform Act, the Company’s assertion has been that it does not reinvest undistributed foreign earnings indefinitely in its foreign subsidiaries. Again, due to the complexity of the many provisions of the Tax Reform Act, the Company has not made a policy decision with respect to its indefinite reinvestment assertion. As stated above, the Company currently estimates that it will not owe additional cash taxes as a result of the transition tax. The provisions of the transition tax rules allow for earnings and profits deficit amounts in one jurisdiction to be netted with positive earnings and profit amounts in other jurisdictions as long as certain U.S. ownership requirements are met. Because of these rules, no transition tax will be paid based on current estimates. Estimates are based on the Company’s post-1986 earnings and profits in its U.S.-owned foreign subsidiaries for which the Company had unremitted earnings. Income (loss) from continuing operations before provision (benefit) for income taxes are taxed under the following jurisdictions (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Domestic $ (2,211 ) $ 6,420 $ 6,290 Foreign 5,433 2,846 6,990 Total $ 3,222 $ 9,266 $ 13,280 Components of the provision (benefit) for income taxes from continuing operations for each of the three years in the period ended December 31, 2017 are as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Current: Federal $ (1,240 ) $ 1,987 $ 537 State (23 ) 498 73 Foreign 4,168 5,345 4,503 Subtotal 2,905 7,830 5,113 Deferred: Federal 13,654 496 (3,624 ) State (248 ) (14 ) 430 Foreign 728 279 (179 ) Subtotal 14,134 761 (3,373 ) Total provision for income taxes $ 17,039 $ 8,591 $ 1,740 The provision (benefit) for income taxes, as a percentage of income from continuing operations before provision (benefit) for income taxes, differs from the statutory U.S. federal income tax rate due to the following: Year Ended December 31, 2017 2016 2015 Statutory U.S. federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes, net of U.S. federal income tax benefit (5.5 ) 3.4 2.7 U.S. tax impact of foreign operations 1.0 (53.4 ) 2.8 Valuation allowance change 405.3 77.6 (24.5 ) Unrecognized tax benefits (91.1 ) 4.7 11.2 Domestic manufacturing deduction — (2.8 ) (1.3 ) Permanent foreign items 53.7 26.8 (7.4 ) Non-income tax contingencies — — (2.0 ) Remeasurement of deferred tax assets/liabilities 117.6 — — Elimination of provision on intercompany transactions 4.6 0.1 — Other 8.2 1.3 (3.4 ) Effective income tax rate 528.8 % 92.7 % 13.1 % Pretax earnings of a foreign subsidiary or affiliate are subject to U.S. taxation when effectively repatriated. Historically, the Company has asserted that it does not reinvest undistributed earnings indefinitely in the Company’s foreign subsidiaries; however, the Company is still assessing the impact of the Tax Reform Act and have not yet made a decision with respect to the Company's indefinite reinvestment assertion. Adjustments relating to the U.S. impact of foreign operations increased the effective tax rate by 1.0 percentage points in 2017 , decreased the effective tax rate by 53.4 percentage points in 2016 , and increased the effective tax rate by 2.8 percentage points in 2015 . The components of this calculation were: Components of U.S. tax impact of foreign operations 2017 2016 2015 Dividends received from foreign subsidiaries 65.7 % 65.9 % 5.4 % Foreign tax credits (4.1 ) (91.8 ) (1.1 ) Foreign tax rate differentials (60.6 ) (27.1 ) (1.2 ) Unremitted earnings — 0.2 (0.3 ) Other adjustments — (0.6 ) — Total 1.0 % (53.4 )% 2.8 % The significant components of the deferred tax assets (liabilities) are as follows (dollar amounts in thousands): As of December 31, 2017 2016 Inventory $ 2,268 $ 1,520 Accrued liabilities 2,190 4,178 Deferred compensation 481 498 Equity-based compensation 3,091 5,034 Intangibles assets 142 237 Bad debts 95 76 Net operating losses 13,755 7,143 Foreign tax and withholding credits 14,572 13,183 Non-income tax accruals 41 57 Health insurance accruals 125 257 Other deferred tax assets 1,869 1,735 Capital loss carryforward 82 510 Valuation allowance (24,024 ) (11,250 ) Total deferred tax assets 14,687 23,178 Other deferred tax liabilities (1,255 ) (1,597 ) Accelerated depreciation (5,919 ) — Total deferred tax liabilities (7,174 ) (1,597 ) Total deferred taxes, net $ 7,513 $ 21,581 The components of deferred tax assets (liabilities), net are as follows (dollar amounts in thousands): As of December 31, 2017 2016 Net deferred tax assets $ 8,283 $ 21,590 Net deferred tax liabilities (770 ) (9 ) Total deferred taxes, net $ 7,513 $ 21,581 At December 31, 2016, net deferred tax liabilities were included in other liabilities on the consolidated balance sheets. Management has provided a valuation allowance of $24.0 million and $11.3 million as of December 31, 2017 and 2016 , respectively, for certain deferred tax assets, including foreign net operating losses, for which management cannot conclude it is more likely than not that they will be realized. The Company reviewed its tax positions and increased its valuation allowance by approximately $12.8 million in 2017 primarily due to a domestic increase of $10.8 million and a foreign increase of $2.0 million . For financial reporting purposes, the release of these valuation allowances would reduce income tax expenses in the year released. At December 31, 2017, the Company had approximately $14.6 million of foreign tax and withholding credits. Of the $14.6 million credits, $14.2 million are foreign tax credits, most of which expire in 2024 and all of which are fully offset by a valuation allowance. At December 31, 2017 , the Company had unused operating loss carryovers for tax purposes of approximately $13.8 million with approximately $9.2 million relating to foreign subsidiaries and approximately $4.6 million relating to U.S. entities. The net operating losses will expire at various dates from 2018 through 2027, with the exception of those in some foreign jurisdictions where there is no expiration. The foreign net operating losses have a full valuation allowance recorded against them. The Company is subject to regular audits by federal, state and foreign tax authorities. These audits may result in additional tax liabilities. The Company believes it has appropriately provided for income taxes for all years. Several factors drive the calculation of its tax reserves. Some of these factors include: (i) the expiration of various statutes of limitations; (ii) changes in tax law and regulations; (iii) the issuance of tax rulings; and (iv) settlements with tax authorities. Changes in any of these factors may result in adjustments to the Company’s reserves, which would impact its reported financial results. The Company’s U.S. federal income tax returns for 2014 through 2016 are open to examination for federal tax purposes. The Company has several foreign tax jurisdictions that have open tax years from 2010 through 2017. The total outstanding balance for liabilities related to unrecognized tax benefits at December 31, 2017 and 2016 was $4.6 million and $6.8 million , respectively, all of which would favorably impact the effective tax rate if recognized. Included in these amounts is approximately $1.7 million and $1.8 million , respectively, of combined interest and penalties. The Company decreased interest and penalties approximately $0.2 million and $0.1 million for the years ended December 31, 2017 and 2016 , respectively. The Company accounts for interest expense and penalties for unrecognized tax benefits as part of its income tax provision. During the years ended December 31, 2017 , 2016 and 2015 , the Company added approximately $0.9 million , $1.4 million and $1.6 million , respectively, to its liability for unrecognized tax benefits. Included in these amounts are approximately $0.1 million , $0.3 million and $0.3 million for the years ended December 31, 2017 , 2016 and 2015 , respectively, related to interest expense and penalties. In addition, the Company recorded a benefit related to the lapse of applicable statute of limitations of approximately $2.3 million , $2.5 million and $0.1 million for the years ended December 31, 2017 , 2016 and 2015 , respectively, all of which favorably impacted the Company’s effective tax rate. A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax benefits, excluding interest and penalties, is as follows for the years (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Unrecognized tax benefits, opening balance $ 4,908 $ 5,825 $ 4,950 Settlement of liability reclassified as income tax payable — — (104 ) Payments on liability — — — Tax positions taken in a prior period Gross increases — — — Gross decreases (705 ) — (47 ) Tax positions taken in the current period Gross increases 716 1,182 1,252 Gross decreases — — — Lapse of applicable statute of limitations (1,970 ) (2,121 ) (69 ) Currency translation adjustments 7 22 (157 ) Unrecognized tax benefits, ending balance $ 2,956 $ 4,908 $ 5,825 The Company anticipates that liabilities related to unrecognized tax benefits will increase approximately $0.2 million to $0.6 million within the next twelve months due to additional transactions related to commissions and transfer pricing. The Company believes that it is reasonably possible that unrecognized tax benefits may change by $0 to $0.2 million within the next twelve months due to the expiration of statutes of limitations in various jurisdictions. Although the Company believes its estimates are reasonable, the Company can make no assurance that the final tax outcome of these matters will not be different from that which it has reflected in its historical income tax provisions and accruals. Such differences could have a material impact on the Company’s income tax provision and operating results in the period in which the Company makes such determination. |
CAPITAL TRANSACTIONS
CAPITAL TRANSACTIONS | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
CAPITAL TRANSACTIONS | CAPITAL TRANSACTIONS Dividends On March 7, 2017, the Company announced a cash dividend of $0.10 per common share in the aggregate of $1.8 million , which was paid on April 3, 2017, to shareholders of record as of March 22, 2017. On May 10, 2017, the Company announced that its Board of Directors elected to suspend the payment of quarterly dividends. The Company's Board of Directors will periodically evaluate the Company’s dividend policy in the future. The declaration of future dividends is subject to the discretion of the Company’s Board of Directors and will depend upon various factors, including the Company’s earnings, financial condition, restrictions imposed by any indebtedness that may be outstanding, cash requirements, future prospects and other factors deemed relevant by its Board of Directors. On February 24, 2016, the Company announced a cash dividend of $0.10 per common share in an aggregate amount of $1.9 million that was paid on March 22, 2016, to shareholders of record on March 11, 2016. On May 10, 2016, the Company announced a cash dividend of $0.10 per common share in an aggregate amount of $1.9 million that was paid on June 6, 2016, to shareholders of record on May 25, 2016. On August 5, 2016, the Company announced a cash dividend of $0.10 per common share in an aggregate amount of $1.9 million that was paid on September 2, 2016, to shareholders of record on August 23, 2016. On November 2, 2016, the Company announced a cash dividend of $0.10 per common share in an aggregate amount of $1.9 million that was paid on December 5, 2016, to shareholders of record on November 23, 2016. Share Repurchase Program In November 2014, the Board of Directors authorized a $20.0 million share repurchase program beginning January 1, 2015. Purchases were made in the open market, through block trades, in privately negotiated transactions or otherwise. This program was discontinued in 2016. Shares repurchased during the years ended December 31, 2017 , 2016 , and 2015 , totaled 0 shares, 0 shares and 501,000 shares, respectively. Share-Based Compensation During the year ended December 31, 2012, the Company’s shareholders adopted and approved the the 2012 Incentive Plan. The 2012 Incentive Plan provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, performance awards, stock awards and other stock-based awards. The Compensation Committee of the Board of Directors has authority and discretion to determine the type of award as well as the amount, terms and conditions of each award under the 2012 Incentive Plan, subject to the limitations of the 2012 Incentive Plan. A total of 1,500,000 shares of the Company’s common stock were originally authorized for the granting of awards under the 2012 Stock Incentive Plan. In January 2015, the Company’s shareholders approved an amendment to the 2012 Incentive Plan, to increase the number of shares of Common Stock reserved for issuance by 1,500,000 shares. The number of shares available for awards, as well as the terms of outstanding awards, are subject to adjustment as provided in the 2012 Incentive Plan for stock splits, stock dividends, recapitalizations and other similar events. The Company also maintains the 2009 Incentive Plan, which was approved by shareholders in 2009. The 2009 Incentive Plan also provided for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent rights, performance awards, stock awards and other stock-based awards. Under the 2012 Incentive Plan, any shares subject to award, or awards forfeited or reacquired by the Company issued under the 2009 Incentive Plan are available for award up to a maximum of 400,000 shares. Stock Options The Company’s outstanding stock options include time-based stock options, which vest over differing periods ranging from the date of issuance up to 48 months from the option grant date; performance-based stock options, which have already vested upon achieving operating income margins of six , eight and ten percent as reported in four of five consecutive quarters over the term of the options. Stock option activity for 2017 , 2016 , and 2015 consisted of the following (share amounts in thousands, except for per share information): Number of Shares Weighted Average Exercise Price Per Share Options outstanding at January 1, 2015 2,037 $ 11.69 Granted 335 14.04 Forfeited or canceled (284 ) 14.07 Exercised (405 ) 9.78 Options outstanding at December 31, 2015 1,683 12.21 Granted — — Forfeited or canceled (124 ) 11.95 Exercised (35 ) 4.74 Options outstanding at December 31, 2016 1,524 12.41 Granted 25 13.50 Forfeited or canceled (142 ) 14.69 Exercised (17 ) 12.06 Options outstanding at December 31, 2017 1,390 $ 12.20 During the year ended December 31, 2017 , the Company granted options to purchase 25,000 shares of common stock under the 2012 Stock Incentive Plan to one member of the Company’s Board of Directors, which are composed of both time-based stock options and net sales performance-based stock options. These options were issued with a weighted-average exercise price of $13.50 per share and a weighted-average grant date fair value of $4.94 per share. All of the options issued have an option termination date of ten years from the option grant date. During the year ended December 31, 2016 , the Company did not grant any stock options to purchase shares of common stock under the 2012 Stock Incentive Plan to the Company’s Board of Directors and executive officers. During the year ended December 31, 2015 , the Company granted time-based options to purchase 335,000 shares of common stock under the 2012 Stock Incentive Plan to the Company’s executive officers and other employees, which are composed of both time-based stock options and net sales performance-based stock options. These options were issued with a weighted average exercise price of $14.04 per share and a weighted average grant date fair value of $4.79 per share. All of the options issued have an option termination date of ten years from the option grant date. For the years ended December 31, 2017 , 2016 , and 2015 , the Company issued 17,000 , 35,000 , and 405,000 shares of common stock upon the exercise of stock options at an average exercise price of $12.06 , $4.74 , and $9.78 per share, respectively. The aggregate intrinsic values of options exercised during the years ended December 31, 2017 , 2016 , and 2015 was $17,000 , $0.2 million , and $1.4 million , respectively. For the years ended December 31, 2017 , 2016 , and 2015 , the Company recognized $17,000 , $0.1 million , and $0.5 million of tax benefits from the exercise of stock options during the period, respectively. The fair value of each option grant was estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted average assumptions for the years ended December 31, 2017 , 2016 , and 2015 : 2017 2016 2015 Weighted average grant date fair value of grants $ 4.94 $ — $ 4.79 Expected life (in years) 5.0 — 5.0 to 6.0 Risk-free interest rate 1.8 — 1.5 to 1.8 Expected volatility 39.8 — 42.6 to 52.3 Dividend yield — — 2.8 to 3.6 Share-based compensation expense from time-based stock options for the years ended December 31, 2017 , 2016 , and 2015 was $0.2 million , $0.8 million and $1.6 million , respectively. As of December 31, 2017 , 2016 , and 2015 , the unrecognized share-based compensation cost related to grants described above was $13,000 , $0.3 million , and $1.1 million , respectively. As of December 31, 2017 , the remaining compensation cost is expected to be recognized over the weighted-average period of approximately 0.2 years. As of December 31, 2017 , the Company did not have any unvested performance-based stock options outstanding. The following table summarizes information about options outstanding and exercisable at December 31, 2017 (share amounts in thousands, except per share information): Options Outstanding Options Exercisable Range of Option Prices Per Share Options Outstanding Weighted-Avg. Remaining Contractual Life Weighted-Avg. Exercise Price Per Share Options Exercisable Weighted-Avg. Remaining Contractual Life Weighted-Avg. Exercise Price Per Share $2.35 to $9.99 152 2.3 $ 5.38 152 2.3 $ 5.38 $10.00 to $13.99 938 4.9 12.42 903 4.9 12.36 $14.00 to $17.70 300 6.7 14.98 238 6.6 15.17 1,390 1,293 At December 31, 2017 , the aggregate intrinsic value of outstanding options to purchase 1,390,000 shares of common stock, the exercisable options to purchase 1,293,000 shares of common stock, and options to purchase 92,000 shares of common stock expected to vest was $0.9 million , $0.9 million , and $0 , respectively. At December 31, 2016 , the aggregate intrinsic value of outstanding options to purchase 1,524,000 shares of common stock, the exercisable options to purchase 1,201,000 shares of common stock, and options to purchase 306,000 shares of common stock expected to vest was $4.2 million , $3.7 million , and $386,000 , respectively. Restricted Stock Units The Company’s outstanding restricted stock units (RSUs) include time-based RSUs, which vest over differing periods ranging from 12 months up to 48 months from the RSU grant date, as well as performance-based RSUs, which upon achieving cumulative annual net sales growth targets over a rolling one-year period and performance-based RSUs, which vest upon achieving earnings-per-share targets over a rolling one-year period. RSUs given to the Board of Directors contain a restriction period in which the shares are not issued until two years after vesting. At December 31, 2017 and 2016 , there were 96,000 and 69,000 vested RSUs given to the Board of Directors that had a restriction period. Restricted stock unit activity for the period ended December 31, 2017 , 2016 , and 2015 is as follows: (share amounts in thousands, except per share information): Number of Shares Weighted Average Grant Date Fair Value Units outstanding at January 1, 2015 180 $ 15.09 Granted 679 12.61 Issued (30 ) 13.63 Forfeited (85 ) 12.84 Units outstanding at December 31, 2015 744 12.48 Granted 281 9.49 Issued (154 ) 13.05 Forfeited (33 ) 12.20 Units outstanding at December 31, 2016 838 11.39 Granted 274 12.62 Issued (187 ) 12.23 Forfeited (197 ) 12.07 Units outstanding at December 31, 2017 728 11.56 During the year ended December 31, 2017 , the Company granted 274,000 restricted stock units (RSUs) of common stock under the 2012 Incentive Plan to the Company’s board, executive officers and other employees, which are composed of both time-based RSUs and net sales and earnings per share performance-based RSUs. The time-based RSUs were granted with a weighted-average grant date fair value $12.29 per share and vest in 12 monthly installments over a one year period from the grant date or in annual installments over three year period from the grant date. The net sales performance-based RSUs were granted with a weighted-average grant date fair value of $13.35 per share and vest upon achieving net sales targets over a three year period from the grant date. During the period ended December 31, 2016 , the Company granted 281,000 RSUs of common stock under the 2012 Incentive Plan to the Company's board, executive officers and other employees. The time-based RSUs were granted with a weighted average grant date fair value of $10.06 per share and vest 12 monthly installments over a one year period from the grant date, or in annual installments over a three year period from the grant date. The net sales performance-based RSUs were granted with h a weighted-average grant date fair value of $8.16 per share and vest upon achieving net sales targets over a three year period from the grant date. During the period ended December 31, 2015 , the Company granted 679,000 RSUs of common stock under the 2012 Incentive Plan to the Company's board, executive officers and other employees. The RSUs were granted with a weighted average grant date fair value of $12.61 per share and vest in 12 monthly installments over a one year period from the grant date, vest in annual installments over a three year periods from from the grant date, or after a three-year cliff. The net sales and earnings per share performance-based RSUs were granted with a weighted-average grant date fair value of $12.13 per share and vest upon achieving (i) net sales targets over a three year period from the grant date and (ii) earnings per share targets over a six year period from the grant date. RSUs are valued at the market value on the date of grant, which is the grant date share price discounted for expected dividend payments during the vesting period. For RSUs with post-vesting restrictions, a Finnerty Model was utilized to calculate a valuation discount from the market value of common shares reflecting the restriction embedded in the RSUs preventing the sale of the underlying shares over a certain period of time. The Finnerty Model proposes to estimate a discount for lack of marketability such as transfer restrictions by using an option pricing theory. This model has gained recognition through its ability to address the magnitude of the discount by considering the volatility of a company’s stock price and the length of restriction. The concept underpinning the Finnerty Model is that restricted stock cannot be sold over a certain period of time. Using assumptions previously determined for the application of the option pricing model at the valuation date, the Finnerty Model discount for lack of marketability is approximately 11.9 percent for a common share. Share-based compensation expense from RSUs for the period ended December 31, 2017 , 2016 , and 2015 , was approximately $2.0 million , $2.4 million , and $2.9 million , respectively. As of December 31, 2017 , and 2016 , the unrecognized share-based compensation expense related to the grants described above was $1.3 million and $2.0 million , respectively. As of December 31, 2017 , the remaining compensation expense is expected to be recognized over the weighted average period of approximately 1.2 years. The Company has not recognized any share-based compensation expense related to the net sales and earnings per share performance-based RSUs for the years ended December 31, 2017 , 2016 , and 2015 . Should the Company attain all of the metrics related to the performance-based RSU grant, the Company would recognize up to $3.5 million of potential share-based compensation expense. The number of shares issued upon vesting or exercise for restricted stock units granted, pursuant to the Company’s share-based compensation plans, is net of shares withheld to cover the minimum statutory withholding requirements that the Company pays on behalf of its employees, which was 43,000 and 20,000 shares for the years ended December 31, 2017 and 2016 , respectively. Although shares withheld are not issued, they are treated as common share repurchases for accounting purposes, as they reduce the number of shares that would have been issued upon vesting. These shares do not count against the authorized capacity under the repurchase program described above. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Deferred Compensation Plans The Company sponsors a qualified deferred compensation plan which qualifies under Section 401(k) of the Internal Revenue Code. During 2017 , the Company made matching contributions of 70 percent of employee contributions up to a maximum of five percent of the employee’s compensation (the match was increased from 60 percent to 70 percent of employee contributions up to a maximum of five percent beginning in 2016). The Company’s contributions to the plan vest after a period of three years . During 2017 , 2016 , and 2015 , the Company contributed to the plan approximately $1.1 million , $1.1 million and $0.9 million , respectively. The Company provides a nonqualified deferred compensation plan for its officers and certain key employees. Under this plan, participants may defer up to 100 percent of their annual salary and bonus. Although participants direct the investment of these funds, they are classified as trading securities and are included in long-term investment securities on the consolidated balance sheets because they remain assets of the Company until they are actually paid out to the participants. The Company has established a trust to finance obligations under the plan. At the end of each year and at other times provided under the plan, the Company adjusts its obligation to a participant by the investment return or loss on the funds selected by the participant under rules established in the plan. Upon separation of employment of the participant with the Company, the obligation owed to the participant under the plan will be paid as a lump sum or over a period of either three or five years (and will continue to be adjusted by the applicable investment return or loss during the period of pay-out). The Company had deferred compensation plan assets of approximately $2.0 million and $1.4 million as of December 31, 2017 , and 2016 , respectively. The change in the liability associated with the deferred compensation plan is recorded in the deferred compensation payable. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Contractual Obligations The Company leases certain facilities and equipment used in its operations and accounts for leases with escalating payments using the straight-line method. The Company incurred expenses of approximately $7.4 million , $6.6 million , and $6.3 million in connection with operating leases during 2017 , 2016 , and 2015 , respectively. The approximate aggregate commitments under non-cancelable operating leases in effect at December 31, 2017 , were as follows (dollar amounts in thousands): Year Ending December 31, 2018 $ 5,918 2019 3,210 2020 2,604 2021 2,139 2022 2,042 Thereafter 12,148 Total $ 28,061 The Company has entered into long-term agreements with third-parties in the ordinary course of business, in which it has agreed to pay a percentage of net sales in certain regions in which it operates, or royalties on certain products. In 2017 , 2016 , and 2015 , the aggregate amounts of these payments were $10,000 , $0.1 million , and $0.1 million , respectively. As of December 31, 2017, the Company had commitments to purchase manufacturing equipment and lease hold improvements for its new headquarters of $1.7 million in 2018 . Legal Proceedings The Company is party to various legal proceedings. Management cannot predict the ultimate outcome of these proceedings, individually or in the aggregate, or their resulting effect on the Company’s business, financial position, results of operations or cash flows as litigation and related matters are subject to inherent uncertainties, and unfavorable rulings could occur. Were an unfavorable outcome to occur, there exists the possibility of a material adverse impact on the business, financial position, results of operations, or cash flows for the period in which the ruling occurs and/or future periods. The Company maintains product liability, general liability and excess liability insurance coverage. However, no assurances can be given that such insurance will continue to be available at an acceptable cost to the Company, that such coverage will be sufficient to cover one or more large claims, or that the insurers will not successfully disclaim coverage as to a pending or future claim. Non-Income Tax Contingencies The Company has reserved for certain state sales and use tax and foreign non-income tax contingencies based on the likelihood of an obligation in accordance with accounting guidance for probable loss contingencies. Loss contingency provisions are recorded for probable losses at management’s best estimate of a loss, or when a best estimate cannot be made, a minimum loss contingency amount is recorded. The Company provides provisions for potential payments of tax to various tax authorities for contingencies related to non-income tax matters, including value-added taxes and sales tax. The Company provides provisions for U.S. state sales taxes in each of the states where the Company has nexus. As of December 31, 2017 and 2016 , accrued liabilities include $0.4 million related to non-income tax contingencies. While management believes that the assumptions and estimates used to determine this liability are reasonable, the ultimate outcome of those matters cannot presently be determined. The Company believes future payments related to these matters could range from $0 to approximately $4.0 million . Other Litigation The Company is party to various other legal proceedings in the United States and several foreign jurisdictions related to value-added tax assessments and other civil litigation. The Company has accrued $1.5 million related to the estimated outcome of these proceedings as of December 31, 2017 . In addition, the Company is party to other litigation where there is a reasonable possibility that a loss may be incurred, either the losses are not considered to be probable or the Company cannot at this time estimate the loss, if any; therefore, no provision for losses has been provided. The Company believes future payments related to these matters could range from $0 to approximately $1.9 million . Self-Insurance Liabilities Similar to other manufacturers and distributors of products that are ingested, the Company faces an inherent risk of exposure to product liability claims in the event that, among other things, the use of its products results in injury. During 2017 the Company secured product liability coverage to cover possible claims, and still maintains accruals for periods prior to the Company obtaining coverage. Prior to this, the Company accrued an amount that it believes is sufficient to cover probable and reasonably estimable liabilities related to product liability claims based on the Company’s history of such claims. However, there can be no assurance that these estimates will prove to be sufficient, nor can there be any assurance that the ultimate outcome of any litigation for product liability will not have a material negative impact on the Company’s business prospects, financial position, results of operations or cash flows. The Company self-insures for certain employee medical benefits. The recorded liabilities for self-insured risks are calculated using actuarial methods and are not discounted. The liabilities include amounts for actual claims and claims incurred but not reported. Actual experience, including claim frequency and severity as well as health care inflation, could result in actual liabilities being more or less than the amounts currently recorded. The Company reviews its self-insurance accruals on a quarterly basis and determines, based upon a review of its recent claims history and other factors, which portions of its self-insurance accruals should be considered short-term and long-term. The Company has accrued $1.5 million and $2.4 million for product liability and employee medical claims at December 31, 2017 and 2016 , respectively, of which $0.6 million and $0.7 million was classified as short-term. Such amounts are included in accrued liabilities and other long-term liabilities on the Company’s consolidated balance sheets. Government Regulations The Company is subject to governmental regulations pertaining to product formulation, labeling and packaging, product claims and advertising, and to the Company’s direct selling system. The Company is also subject to the jurisdiction of numerous foreign tax and customs authorities. Any assertions or determinations that either the Company or the Company’s independent Distributors are not in compliance with existing statutes, laws, rules or regulations could potentially have a material adverse effect on the Company’s operations. In addition, in any country or jurisdiction, the adoption of new statutes, laws, rules or regulations, or changes in the interpretation of existing statutes, laws, rules or regulations could have a material adverse effect on the Company and its operations. Although management believes that the Company is in compliance, in all material respects, with the statutes, laws, rules and regulations of every jurisdiction in which it operates, no assurance can be given that the Company’s compliance with applicable statutes, laws, rules and regulations will not be challenged by foreign authorities or that such challenges will not have a material adverse effect on the Company’s financial position, results of operations or cash flows. |
OPERATING BUSINESS SEGMENT AND
OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION | OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION The Company has four business segments. These business segments are components of the Company for which separate information is available that is evaluated regularly by the chief executive officer in deciding how to allocate resources and in assessing relative performance. The Company has four business segments that are divided based on the different characteristics of their distributor and customer bases, distributor compensation plans and product formulations, as well as the internal organization of its officers and their responsibilities and business operations. Three business segments operate under the Nature’s Sunshine Products brand (NSP Americas; NSP Russia, Central and Eastern Europe; and NSP China), and one business segment operates under the Synergy® WorldWide brand. The NSP Russia, Central and Eastern Europe segment also includes the Company’s wholesale business, in which the Company sells its products to various locally-managed entities independent of the Company that the Company has granted distribution rights for the relevant market. Net sales for each segment have been reduced by intercompany sales as they are not included in the measure of segment profit or loss reviewed by the chief executive officer. The Company evaluates performance based on contribution margin (loss) by segment before consideration of certain inter-segment transfers and expenses. In the fourth quarter of 2017, the Company moved the reporting of its wholesale business, in which the Company sells its products to a locally managed entity independent of the Company that has distribution rights for the market, from the China and New Markets segment to the NSP Russia, Central and Eastern Europe segment. The net sales and contribution margin for the years ended December 31, 2016 and 2015 were recast to reflect that change. Reportable business segment information for the years ended December 31, 2017 , 2016 , and 2015 is as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Net sales: NSP Americas $ 166,017 $ 175,922 $ 179,151 NSP Russia, Central and Eastern Europe 32,190 29,998 31,469 Synergy WorldWide 123,833 124,793 114,081 NSP China 19,989 10,446 4 Total net sales 342,029 341,159 324,705 Contribution margin (1): NSP Americas 69,408 75,005 74,953 NSP Russia, Central and Eastern Europe 10,930 10,525 11,340 Synergy WorldWide 35,377 38,034 35,277 NSP China 15,307 6,748 4 Total contribution margin 131,022 130,312 121,574 Selling, general and administrative (2) 129,635 120,273 107,702 Operating income 1,387 10,039 13,872 Other income (loss), net 1,835 (773 ) (592 ) Income from continuing operations before provision for income taxes $ 3,222 $ 9,266 $ 13,280 ___________________________ (1) Contribution margin consists of net sales less cost of sales and volume incentives expense. (2) Service fees in the NSP China segment related to sales in China, occurring after the Company's receipt of its direct selling license and pre-opening sales through Hong Kong, totaled $7.2 million , $4.3 million, and $0 for the years ended December 31, 2017 , 2016 , and 2015 , respectively. These service fees are included in the Company's selling, general and administrative expenses. Year Ended December 31, 2017 2016 2015 Capital expenditures: NSP Americas $ 3,965 $ 8,999 $ 21,437 NSP Russia, Central and Eastern Europe 55 131 — Synergy WorldWide 763 564 302 NSP China 603 430 487 Total capital expenditures $ 5,386 $ 10,124 $ 22,226 Depreciation and amortization: NSP Americas $ 7,884 $ 3,997 $ 3,603 NSP Russia, Central and Eastern Europe 60 42 26 Synergy WorldWide 621 713 885 NSP China 69 56 11 Total depreciation and amortization $ 8,634 $ 4,808 $ 4,525 As of December 31, 2017 2016 Assets: NSP Americas $ 127,246 $ 146,761 NSP Russia, Central and Eastern Europe 6,664 6,106 Synergy WorldWide 44,047 39,083 NSP China 17,238 13,620 Total assets $ 195,195 $ 205,570 From an individual country perspective, only the United States and South Korea comprises approximately 10 percent or more of consolidated net sales for any of the years ended December 31, 2017 , 2016 , and 2015 as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Net sales: United States $ 140,860 $ 148,060 $ 147,553 South Korea 52,020 57,637 48,476 Other 149,149 135,462 128,676 Total net sales $ 342,029 $ 341,159 $ 324,705 Revenue generated by each of the Company’s product lines is set forth below (dollars in thousands): Year Ended December 31, 2017 2016 2015 NSP Americas: General health $ 74,492 $ 78,187 $ 80,315 Immunity 20,451 19,185 22,042 Cardiovascular 11,454 12,677 12,331 Digestive 45,231 47,659 49,239 Personal care 7,260 7,537 3,575 Weight management 7,129 10,677 11,649 166,017 175,922 179,151 NSP Russia, Central and Eastern Europe: General health $ 14,813 $ 12,907 $ 13,332 Immunity 3,530 3,349 3,853 Cardiovascular 2,166 2,212 2,006 Digestive 8,261 8,009 8,178 Personal care 2,330 2,370 2,809 Weight management 1,090 1,151 1,291 32,190 29,998 31,469 Synergy WorldWide: General health $ 31,973 $ 35,283 $ 43,829 Immunity 508 620 752 Cardiovascular 50,702 51,684 34,191 Digestive 16,121 12,536 17,746 Personal care 8,532 8,981 5,697 Weight management 15,997 15,689 11,866 123,833 124,793 114,081 NSP China: General health $ 3,738 $ 1,551 $ 4 Immunity 468 370 — Cardiovascular 3,886 2,617 — Digestive 8,361 4,323 — Personal care 350 629 — Weight management 3,186 956 — 19,989 10,446 4 Total net sales $ 342,029 $ 341,159 $ 324,705 From an individual country perspective, only the United States comprise 10 percent or more of consolidated property, plant and equipment as follows (dollar amounts in thousands): As of December 31 2017 2016 Property, plant and equipment United States $ 65,928 $ 70,770 Other 3,178 2,502 Total property, plant and equipment $ 69,106 $ 73,272 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS The Company maintains split-dollar life insurance policies on certain executives. The cash surrender value of $15,000 related to such policies is recorded in other assets as of December 31, 2017 and 2016 , respectively. The Company's joint venture in China borrowed $2.0 million from the Company and $0.5 million from the Company's joint venture partner, during the year ended December 31, 2017. These notes are payable in one year and bear interest of 3.0 percent. The note between the joint venture and the Company eliminates in consolidation. Subsequent to the year ended December 31, 2017, the Company's joint venture in China borrowed an additional $2.0 million from the Company and $0.5 million from the Company's joint venture partner. These notes are payable in one year and bear interest of 3.0 percent. Eugene L. Hughes, a former member of the Company's Board of Directors, and the spouse of Kristine F. Hughes, Vice Chair of the Board of Directors, retired as an employee of the Company effective as of December 22, 2008. The Company and Mr. Hughes entered into a Retirement and Consulting Agreement, dated as of December 9, 2008, pursuant to which Mr. Hughes provided consulting services to the Company for an initial term of eight years following his retirement. In exchange for such consulting services, Mr. Hughes received an annual compensation of approximately $0.2 million for the first two years of service, and an annual compensation of $0.1 million for the remainder of the initial term. The term of the Retirement and Consulting Agreement with Mr. Hughes expired on December 22, 2016, and was not renewed. |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values of each financial instrument. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. The following table presents the Company’s hierarchy for its asset measured at fair value on a recurring basis as of December 31, 2017 (dollar amounts in thousands): Level 1 Level 2 Level 3 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Total Investment securities - trading $ 1,980 — — $ 1,980 Total assets measured at fair value on a recurring basis $ 1,980 $ — $ — $ 1,980 The following table presents the Company’s hierarchy for its asset measured at fair value on a recurring basis as of December 31, 2016 : Level 1 Level 2 Level 3 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Total Investments available-for-sale U.S. government security funds $ 1,776 — — $ 1,776 Investment securities - trading 1,391 — — 1,391 Total assets measured at fair value on a recurring basis $ 3,167 $ — $ — $ 3,167 Investments available-for-sale - The majority of the Company’s investment portfolio consists of U.S. government security funds. The Level 1 securities are valued using quoted prices for identical assets in active markets including equity securities and U.S. government treasuries. Trading Investment securities - The Company’s trading portfolio consists of various marketable securities that are valued using quoted prices in active markets. For the years ended December 31, 2017 and 2016 , there were no fair value measurements using significant other observable inputs (Level 2) or significant unobservable inputs (Level 3). The carrying amounts reflected on the consolidated balance sheet for cash and cash equivalents, accounts receivable, and accounts payable approximate fair value due to their short-term nature. The carrying amount reflected on the consolidated balance sheet for the revolving credit facility approximate fair value due to it being variable-rate debt. During the years ended December 31, 2017 and 2016 , the Company did not have any re-measurements of non-financial assets at fair value on a nonrecurring basis subsequent to their initial recognition. |
SUMMARY OF QUARTERLY OPERATIONS
SUMMARY OF QUARTERLY OPERATIONS - UNAUDITED | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
SUMMARY OF QUARTERLY OPERATIONS - UNAUDITED | SUMMARY OF QUARTERLY OPERATIONS — UNAUDITED The following tables presents the Company’s unaudited summary of quarterly operations during 2017 and 2016 for each of three month periods ended March 31, June 30, September 30, and December 31 (dollar amounts in thousands, except per share information). For the Quarter Ended March 31, June 30, September 30, December 31, Net sales $ 83,098 $ 81,344 $ 89,301 $ 88,286 Cost of sales (21,728 ) (21,197 ) (23,505 ) (24,607 ) Gross profit 61,370 60,147 65,796 63,679 Volume incentives 28,983 28,288 30,716 31,983 Selling, general and administrative 30,336 31,836 32,926 34,537 Operating income (loss) 2,051 23 2,154 (2,841 ) Other income (expense) 1,275 441 193 (74 ) Income (loss) before income taxes 3,326 464 2,347 (2,915 ) Provision (benefit) for income taxes 1,463 884 (1 ) 14,693 Net income (loss) 1,863 (420 ) 2,348 (17,608 ) Net loss attributable to noncontrolling interests (297 ) (233 ) (95 ) (250 ) Net income (loss) attributable to common shareholders $ 2,160 $ (187 ) $ 2,443 $ (17,358 ) Basic and diluted net income (loss) per common share: Basic earnings (loss) per share attributable to common shareholders: $ 0.11 $ (0.01 ) $ 0.13 $ (0.92 ) Diluted earnings (loss) per share attributable to common shareholders: $ 0.11 $ (0.01 ) $ 0.13 $ (0.92 ) Dividends declared per common share $ 0.10 $ — $ — $ — Basic and diluted income (loss) per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly net income (loss) per share may not equal the total computed for the year. During the fourth quarter of 2017, the Company's provision for income taxes was affected by an addition of valuation allowances on U.S. foreign tax credits as a result of the Tax Reform Act, re-measurement of deferred tax assets and liabilities from 35 percent to 21 percent, and the impact of current year foreign losses that will not provide tax benefit. The Company’s provision for income taxes is discussed in further detail in Note 11. For the Quarter Ended March 31, June 30, September 30, December 31, Net sales $ 82,402 $ 89,366 $ 85,441 $ 83,950 Cost of sales (22,020 ) (23,078 ) (21,512 ) (24,327 ) Gross profit 60,382 66,288 63,929 59,623 Volume incentives 29,877 30,791 29,684 29,558 Selling, general and administrative 28,385 31,249 29,187 31,452 Operating income (loss) 2,120 4,248 5,058 (1,387 ) Other income (expense), net 1,559 (622 ) 20 (1,730 ) Income (loss) before income taxes 3,679 3,626 5,078 (3,117 ) Provision for income taxes 1,890 1,260 1,136 4,305 Net income (loss) 1,789 2,366 3,942 (7,422 ) Net loss attributable to noncontrolling interests (280 ) (202 ) (213 ) (769 ) Net income (loss) attributable to common shareholders $ 2,069 $ 2,568 $ 4,155 $ (6,653 ) Basic and diluted net income (loss) per common share: Basic earnings (loss) per share attributable to common shareholders: $ 0.11 $ 0.14 $ 0.22 $ (0.35 ) Diluted earnings (loss) per share attributable to common shareholders: $ 0.11 $ 0.14 $ 0.22 $ (0.35 ) Dividends declared per common share $ 0.10 $ 0.10 $ 0.10 $ 0.10 Basic and diluted income (loss) per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly net income (loss) per share may not equal the total computed for the year. During the fourth quarter of 2016, the Company's provision for income taxes was affected by an addition of valuation allowances on U.S. foreign tax credits, in addition to the impact of current year foreign losses that will not provide tax benefit. The Company’s provision for income taxes is discussed in further detail in Note 11. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2017 | |
Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | NATURE’S SUNSHINE PRODUCTS, INC. SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED DECEMBER 31, 2017 , 2016 , AND 2015 (Amounts in thousands) Description Balance at Beginning of Year Provisions Amounts Written Off Amounts Recovered Effect of Currency Translation Balance at End of Year Year Ended December 31, 2017 Allowance for doubtful accounts receivable $ 205 $ 556 $ (366 ) $ — $ — $ 395 Allowance for sales returns 156 1,746 (1,644 ) — 12 270 Tax valuation allowance 11,250 13,786 — (865 ) (147 ) 24,024 Year Ended December 31, 2016 Allowance for doubtful accounts receivable $ 190 $ 305 $ (290 ) $ — $ — $ 205 Allowance for sales returns 94 1,435 (1,368 ) — (5 ) 156 Tax valuation allowance 6,565 5,638 (493 ) — (460 ) 11,250 Year Ended December 31, 2015 Allowance for doubtful accounts receivable $ 849 $ 83 $ (714 ) $ — $ (28 ) $ 190 Allowance for sales returns 129 1,126 (1,155 ) — (6 ) 94 Tax valuation allowance 13,169 (6,088 ) — — (516 ) 6,565 |
NATURE OF OPERATIONS AND SIGN28
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations The Company is a natural health and wellness company primarily engaged in the manufacturing and direct selling of nutritional and personal care products. The Company is a Utah corporation with its principal place of business in Lehi, Utah, and sells its products to a sales force of independent distributors that uses the products themselves or resells them to consumers The Company markets its products in Australia, Austria, Belarus, Canada, China, Colombia, the Czech Republic, Denmark, the Dominican Republic, Ecuador, El Salvador, Finland, Germany, Guatemala, Honduras, Hong Kong, Iceland, Indonesia, Ireland, Italy, Japan, Kazakhstan, Latvia, Lithuania, Malaysia, Mexico, Moldova, Mongolia, the Netherlands, New Zealand, Norway, Panama, Poland, Russia, Singapore, Slovakia, Slovenia, South Korea, Spain, Sweden, Taiwan, Thailand, Ukraine, the United Kingdom and the United States. The Company also markets its products though a wholesale model to Australia, Brazil, Chile, Israel, New Zealand, Norway, Peru, Portugal, Spain and the United Kingdom. |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts and transactions of the Company and its subsidiaries. At December 31, 2017 and 2016 , substantially all of the Company’s subsidiaries were wholly owned. Intercompany balances and transactions have been eliminated in consolidation. The Company consolidates the joint ventures in Hong Kong and China in its consolidated financial statements, with another party's interest presented as a noncontrolling interest. Additionally, the Company operates a limited number of markets in jurisdictions where local laws require the formation of a partnership with an entity domiciled in that market. These partners have no rights to participate in the sharing of revenues, profits, losses or distribution of assets upon liquidation of these partnerships. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities, in these financial statements and accompanying notes. Actual results could differ from these estimates and those differences could have a material effect on the Company’s financial position and results of operations. The significant accounting estimates inherent in the preparation of the Company’s financial statements include estimates associated with its evaluation of impairment of long-lived assets, the determination of liabilities related to Manager and Distributor incentives, the determination of income tax assets and liabilities, certain other non-income tax and value-added tax contingencies, legal contingencies, and the valuation of investments. In addition, significant estimates form the basis for allowances with respect to inventory valuations and self-insurance liabilities associated with product liability and medical claims. Various assumptions and other factors enter into the determination of these significant estimates. The process of determining significant estimates takes into account historical experience and current and expected economic conditions. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid short-term investments with original maturities of three months or less to be cash equivalents. Substantially all of the Company’s cash deposits either exceed the United States federally insured limit or are located in countries that do not have government insured accounts or are subject to tax withholdings when repatriating earnings. |
Accounts Receivable | Accounts Receivable Accounts receivable consist principally of receivables from credit card companies, arising from the sale of products to the Company’s independent Distributors, and receivables from independent Distributors in foreign markets. Accounts receivable have been reduced by an allowance for amounts that may be uncollectible in the future. However, due to the geographic dispersion of credit card and Distributor receivables, the collection risk is not considered to be significant. Substantially all of the receivables from credit card companies were current as of December 31, 2017 and 2016 . Although receivables from independent Distributors can be significant, the Company performs ongoing credit evaluations of its independent Distributors and maintains an allowance for potential credit losses. This estimated allowance is based primarily on the aging category, historical trends and management’s evaluation of the financial condition of the customer. This reserve is adjusted periodically as information about specific accounts becomes available. |
Investment Securities | Investment Securities The Company has certain investment securities classified as trading securities. The Company maintains its trading securities portfolio to generate returns that are offset by corresponding changes in certain liabilities related to the Company’s deferred compensation plans (see Note 13). The trading securities portfolio consists of marketable securities, which are recorded at fair value and are included in long-term investment securities on the consolidated balance sheets because they remain assets of the Company until they are actually paid out to the participants. These investment securities are not available to the Company to fund its operations as they are restricted for the payment of the deferred compensation payable. The Company has established a rabbi trust to finance obligations under the plan. Both realized and unrealized gains and losses on trading securities are included in interest and other income. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, investments, accounts payable approximate fair value due to their short-term nature. The carrying amount reflected on the condensed consolidated balance sheet for the revolving credit facility approximates fair value due to it being variable-rate debt. During the years ended December 31, 2017 , and 2016 , the Company did not have any write-offs related to the remeasurement of non-financial assets at fair value on a nonrecurring basis subsequent to their initial recognition. |
Inventories | Inventories Inventories are stated at the lower-of-cost-or-market, using the first-in, first-out method. The components of inventory cost include raw materials, labor and overhead. To estimate any necessary obsolescence or lower-of-cost-or-market adjustments, various assumptions are made in regard to excess or slow-moving inventories, non-conforming inventories, expiration dates, current and future product demand, production planning and market conditions. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are recorded at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Estimated useful lives for buildings range from 20 to 50 years; building improvements range from 7 to 10 years; machinery and equipment range from 2 to 10 years; computer software and hardware range from 3 to 10 years; and furniture and fixtures range from 2 to 5 years. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the related assets. Maintenance and repairs are expensed as incurred and major improvements are capitalized. The Company has made a significant investment in its information systems of approximately $48.5 million as of December 31, 2017 and began to amortize the asset over 10 years beginning April 2, 2017. |
Intangible Assets | Intangible Assets Intangible assets consist of purchased product formulations and product registrations. Such intangible assets are amortized using the straight-line method over the estimated economic lives of the assets of 9 to 15 years. Intangible assets, net of accumulated amortization, totaled $0.7 million and $1.0 million , at December 31, 2017 , and 2016 , respectively. |
Other Assets | Other Assets Other assets include lease deposits, deposits with third party service providers, deposits to operate in certain markets and potential foreign tax credit benefits related to the liability for unrecognized tax benefits. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets, such as property, plant and equipment and intangible assets for impairment when events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The Company uses an estimate of future undiscounted net cash flows of the related assets or groups of assets over their remaining lives in measuring whether the assets are recoverable. An impairment loss is calculated by determining the difference between the carrying values and the fair values of these assets. |
Incentive Trip Accrual | Incentive Trip Accrual The Company accrues for expenses associated with its direct sales program, which rewards independent Managers and Distributors with paid attendance for incentive trips, including Company conventions and meetings. Expenses associated with incentive trips are accrued over qualification periods as they are earned. The Company specifically analyzes incentive trip accruals based on historical and current sales trends as well as contractual obligations when evaluating the adequacy of the incentive trip accrual. Actual results could generate liabilities more or less than the amounts recorded. The Company has accrued convention and meeting costs of $5.0 million and $5.1 million at December 31, 2017 , and 2016 , respectively, which are included in accrued liabilities in the consolidated balance sheets. |
Foreign Currency Translation | Foreign Currency Translation The local currency of the foreign subsidiaries is used as the functional currency, except for the Company’s operations are served by a U.S. based subsidiary (for example, Russia and Ukraine). The financial statements of foreign subsidiaries where the local currency is the functional currency are translated into U.S. dollars using exchange rates in effect at year end for assets and liabilities and average exchange rates during each year for the results of operations. Adjustments resulting from translation of financial statements are reflected in accumulated other comprehensive loss, net of income taxes. Foreign currency transaction gains and losses are included in other income (expense) in the consolidated statements of operations. The functional currency in highly inflationary economies is the U.S. dollar and transactions denominated in the local currency are re-measured as if the functional currency were the U.S. dollar. The remeasurement of local currencies into U.S. dollars creates translation adjustments, which are included in the consolidated statements of operations. A country is considered to have a highly inflationary economy if it has a cumulative inflation rate of approximately 100 percent or more over a three year period as well as other qualitative factors including historical inflation rate trends (increasing and decreasing), the capital intensiveness of the operation, and other pertinent economic factors. |
Revenue Recognition | Revenue Recognition Net sales and related volume incentive expenses are recorded when persuasive evidence of an arrangement exists, collectability is reasonably assured, the amount is fixed and determinable, and title and risk of loss have passed. The amount of the volume incentive is determined based upon the amount of qualifying purchases in a given month. Amounts received for undelivered merchandise are recorded as deferred revenue. From time to time, the Company’s U.S. operations extend short-term credit associated with product promotions. In addition, for certain of the Company’s international operations, the Company offers credit terms consistent with industry standards within the country of operation. Payments to independent Managers and Distributors for sales incentives or rebates are recorded as a reduction of revenue. Payments for sales incentives and independent rebates are calculated monthly based upon qualifying sales. Membership fees are deferred and amortized as revenue over the life of the membership, primarily one year . Prepaid event registration fees are deferred and recognized as revenues when the related event is held. A reserve for product returns is recorded based upon historical experience. The Company allows independent Managers or Distributors to return the unused portion of products within ninety days of purchase if they are not satisfied with the product. In some of the Company’s markets, the requirements to return product are more restrictive. Sales returns for the years 2017 , 2016 and 2015 , were $1.6 million , $1.4 million , and $1.2 million , respectively. Amounts billed to customers for shipping and handling are reported as a component of net sales. Shipping and handling revenues of approximately $8.2 million , $9.2 million , and $9.2 million were reported as net sales for the years ended December 31, 2017 , 2016 , and 2015 , respectively. Taxes that have been assessed by governmental authorities and that are directly imposed on revenue-producing transactions between the Company and its customers, including sales, use, value-added, and some excise taxes, are presented on a net basis (excluded from net sales). |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and classified in selling, general and administrative expenses. Advertising expense incurred for the years ended December 31, 2017 , 2016 , and 2015 totaled approximately $2.1 million , $1.9 million and $2.2 million , respectively. |
Research and Development | Research and Development All research and development costs are expensed as incurred and classified in selling, general and administrative expense. Total research and development expenses were approximately $3.4 million , $3.2 million , and $2.8 million in 2017 , 2016 , and 2015 , respectively. |
Contingencies | Contingencies The Company is involved in certain legal proceedings. When a loss is considered probable in connection with litigation or non-income tax contingencies and when such loss can be reasonably estimated, the Company records its best estimate within a range related to the contingency. If there is no best estimate, the Company records the minimum of the range. As additional information becomes available, the Company assesses the liability related to the contingency and revises the estimates. Revision in estimates of the liabilities could materially affect the Company's results of operations in the period of adjustment. The Company’s contingencies are discussed in further detail in Note 14. |
Income Taxes | Income Taxes The Company’s income tax expense includes amounts related to the United States and many foreign jurisdictions and is comprised of current year income taxes payable, changes in its deferred tax assets and liabilities and contingent reserves. Deferred tax assets are offset by a valuation allowance if it is believed to be more likely than not that some portion of the deferred tax asset will not be fully realized. On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (Tax Reform Act) which changes U.S. corporate income taxation in a number of significant ways including, but are not limited to, lowering the corporate income tax rate from 35% to 21%, implementing a quasi-territorial tax regime by providing a 100% Dividends Received Deduction (“DRD”) of foreign dividends, imposing a one-time transition tax on deemed repatriated post-1986 undistributed earnings of foreign subsidiaries and revising or eliminating certain deductions. The effect of some of the provisions of the Tax Reform Act are required to be recognized in the year of enactment, 2017, such as determining the transition tax and re-measuring deferred tax assets and liabilities. In December 2017, the Securities and Exchange Commission issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which provides guidance on accounting for the impact of the Tax Reform Act. See Note 11, Income Taxes, for more details regarding the Company’s income taxes and the impact of the Tax Reform Act. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share Basic net income (loss) per common share (“Basic EPS”) is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. Following is a reconciliation of the numerator and denominator of Basic EPS to the numerator and denominator of Diluted EPS for all years (dollar and share amounts in thousands, except for per share information): 2017 2016 2015 Net income (loss) attributable to common shareholders: Net income (loss) from continuing operations $ (12,942 ) $ 2,139 $ 12,571 Income from discontinued operations $ — $ — $ 2,116 Net income (loss) $ (12,942 ) $ 2,139 $ 14,687 Basic weighted-average shares outstanding 18,882 18,731 18,656 Basic earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.67 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.79 Diluted Shares Outstanding Basic weighted-average shares outstanding 18,882 18,731 18,656 Stock-based awards — 325 521 Diluted weighted-average shares outstanding 18,882 19,056 19,177 Diluted earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.66 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.77 Potentially dilutive shares excluded from diluted-per-share amounts: Stock options — (1) 288 345 Potentially anti-dilutive shares excluded from diluted-per-share amounts: Stock options 2,118 (1) 1,347 688 (1) As a result of the net loss for the year ended December 31, 2017, no potentially dilutive securities are included in the calculation of diluted earnings (loss) per share because such effect would be anti-dilutive. Potentially dilutive securities include 1,390 outstanding options to purchase shares of common stock and 728 restricted stock units. Potentially dilutive shares excluded from diluted-per-share amounts include performance-based options to purchase shares of common stock, for which certain earnings metrics have not been achieved. Potentially anti-dilutive shares excluded from diluted-per-share amounts include both non-qualified stock options and unearned performance-based options to purchase shares of common stock with exercise prices greater than the weighted-average share price during the period and shares that would be anti-dilutive to the computation of diluted net income per share for each of the years presented. |
Share-Based Compensation | Share-Based Compensation The Company’s outstanding stock options include time-based stock options, which vest over differing periods ranging from the date of issuance up to 48 months from the option grant date; performance-based stock options, which have already vested upon achieving operating income margins of six , eight and ten percent as reported in four of five consecutive quarters over the term of the options. The Company’s outstanding restricted stock units ("RSUs") include time-based RSUs, which vest over differing periods ranging from 12 months up to 48 months from the RSU grant date, as well as performance-based RSUs, which vest upon achieving cumulative annual net sales growth targets over a rolling one year period and performance-based RSUs, which vest upon achieving earnings-per-share targets over a rolling one-year period. RSUs granted to the Board of Directors contain a restriction period in which the shares are not issued until two years after vesting. The Company recognizes all share-based payments to Directors and employees, including grants of stock options and restricted stock units, in the statement of operations based on their grant-date fair values. The Company records compensation expense, over the vesting period of the stock options and restricted stock units based on the fair value of the stock options and restricted stock units on the date of grant. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) includes all changes in shareholders’ equity except those resulting from investments by, and distributions to, shareholders. Accordingly, the Company’s comprehensive income (loss) includes net income (loss), net unrealized gains (losses) on investment securities, reclassifications of realized gains, and foreign currency adjustments that arise from the translation of the financial statements of the Company’s foreign subsidiaries. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09 - Revenue from Contracts with Customers (Topic 606), and has subsequently issued ASUs 2015-14 - Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, 2016-08 - Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross Versus Net), 2016-10 - Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, 2016-12 - Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, and 2016-20 - Revenue from Contracts with Customers (Topic 606): Technical Corrections and Improvements to Topic 606 (collectively, Topic 606). Topic 606 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance is based on the principle that an entity should recognize revenue to depict the transfer of 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. The guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to fulfill a contract. This guidance is effective for the Company beginning on January 1, 2018, and provides the Company with the option of using either a full retrospective or a modified retrospective approach for the adoption of the new standard. The Company adopted Topic 606 in January 2018 under a modified retrospective approach, under which the cumulative effect of initially applying Topic 606 is recognized as an adjustment to the opening balance of retained earnings. As a result of adopting Topic 606, the Company will, recognize revenue upon shipments to distributors net of sales reserves. The cumulative effect of adopting Topic 606 on January 1, 2018 was an increase to retained earnings of $0.8 million (net of tax). In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This guidance requires that entities with a classified statement of financial position present all deferred tax assets and liabilities as non-current. This update was adopted during the first quarter of 2017 and applied on the retrospective basis. Other than the netting of current deferred tax assets of $5.6 million , which increased long-term deferred tax assets from $16.0 million to $21.6 million as of December 31, 2016, the adoption of this ASU did not have a material impact on the Company’s results of operations and consolidated financial statements. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. This update amends the guidance in U.S. GAAP on the classification and measurement of financial instruments. Although the ASU retains many current requirements, it significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. This update is effective for interim and annual periods beginning after December 15, 2017. The adoption of this ASU is not expected to have a material impact on the Company’s results of operations, consolidated financial statements and footnote disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842): Accounting for Leases. This update specifies that lessees should recognize assets and liabilities arising from all leases, except for leases with a lease term of 12 months or less. The recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee will largely remain unchanged and shall continue to depend on its classification as a finance or operating lease. The ASU will be effective for annual periods beginning after December 15, 2018 with early adoption permitted. The adoption of this ASU is not expected to have a material impact on the Company’s results of operations; however, it is expected to gross-up the consolidated balance sheet as a result of recognizing a lease asset along with a similar lease liability. In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. This update amends the scope of modification accounting surrounding share-based payment arrangements as issued in ASU 2016-09 by providing guidance on the various types of changes which would trigger modification accounting for share-based payment awards. ASU 2017-09 is effective for annual periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted, including adoption in any interim period, for public business entities for reporting periods for which financial statements have not yet been issued. While the Company does not expect the adoption of ASU 2017-09 to have a material effect on its business, the Company is still evaluating any potential impact that adoption of ASU 2017-09 may have on its results of operations, consolidated financial statements and footnote disclosures. |
NATURE OF OPERATIONS AND SIGN29
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of reconciliation of the numerator and denominator of Basic EPS to the numerator and denominator of Diluted EPS | Following is a reconciliation of the numerator and denominator of Basic EPS to the numerator and denominator of Diluted EPS for all years (dollar and share amounts in thousands, except for per share information): 2017 2016 2015 Net income (loss) attributable to common shareholders: Net income (loss) from continuing operations $ (12,942 ) $ 2,139 $ 12,571 Income from discontinued operations $ — $ — $ 2,116 Net income (loss) $ (12,942 ) $ 2,139 $ 14,687 Basic weighted-average shares outstanding 18,882 18,731 18,656 Basic earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.67 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.79 Diluted Shares Outstanding Basic weighted-average shares outstanding 18,882 18,731 18,656 Stock-based awards — 325 521 Diluted weighted-average shares outstanding 18,882 19,056 19,177 Diluted earnings (loss) per share attributable to common shareholders: Net income (loss) from continuing operations $ (0.69 ) $ 0.11 $ 0.66 Income from discontinued operations $ — $ — $ 0.11 Net income (loss) $ (0.69 ) $ 0.11 $ 0.77 Potentially dilutive shares excluded from diluted-per-share amounts: Stock options — (1) 288 345 Potentially anti-dilutive shares excluded from diluted-per-share amounts: Stock options 2,118 (1) 1,347 688 (1) As a result of the net loss for the year ended December 31, 2017, no potentially dilutive securities are included in the calculation of diluted earnings (loss) per share because such effect would be anti-dilutive. Potentially dilutive securities include 1,390 outstanding options to purchase shares of common stock and 728 restricted stock units. |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of operating results of the entity's discontinued operations | The following table summarizes the operating results of the Company’s discontinued operations (dollar amounts in thousands): 2015 Net sales $ — Income before income tax provision $ 2,604 Income tax provision 488 Income from discontinued operations $ 2,116 |
RESTRUCTURING RELATED EXPENSES
RESTRUCTURING RELATED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of restructuring activities | The following table summarizes the 2015, 2016, and 2017 restructuring activity: Total Liability balance at December 31, 2014 $ — Increase in liability 3,306 Reduction in liability (payments) (2,462 ) Liability balance at December 31, 2015 $ 844 Increase in liability 200 Reduction in liability (payments) (995 ) Liability balance at December 31, 2016 $ 49 Increase in liability 1,483 Reduction in liability (payments) (782 ) Liability balance at December 31, 2017 $ 750 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of composition of inventories | The composition of inventories is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Raw materials $ 9,522 $ 14,995 Work in process 2,153 694 Finished goods 32,372 31,908 Total inventory $ 44,047 $ 47,597 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of composition of property, plant and equipment | The composition of property, plant and equipment is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Land and improvements $ 841 $ 1,996 Buildings and improvements 30,760 30,277 Machinery and equipment 25,160 23,699 Furniture and fixtures 20,385 19,962 Computer software and hardware 51,632 49,340 128,778 125,274 Accumulated depreciation and amortization (59,672 ) (52,002 ) Total property, plant and equipment $ 69,106 $ 73,272 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of estimated amortization expense for the five succeeding fiscal years and thereafter | Estimated amortization expense for the five succeeding years and thereafter is as follows (dollar amounts in thousands): Year Ending December 31, 2018 $ 186 2019 186 2020 186 2021 134 2022 17 Total $ 709 |
INVESTMENT SECURITIES (Tables)
INVESTMENT SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of amortized cost and estimated fair values of available-for-sale securities by balance sheet classification | The amortized cost and estimated fair values of available-for-sale securities are as follows (dollar amounts in thousands): As of December 31, 2016 Amortized Gross Gross Fair U.S. government securities funds $ 1,799 $ — $ (23 ) $ 1,776 Total short-term investment securities $ 1,799 $ — $ (23 ) $ 1,776 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of composition of accrued liabilities | The composition of accrued liabilities is as follows (dollar amounts in thousands): As of December 31, 2017 2016 Salaries and employee benefits $ 10,289 $ 10,670 Sales, use and property tax (See Note 14) 3,367 2,376 Convention and meeting costs 4,970 5,129 Other 6,354 6,225 Total $ 24,980 $ 24,400 |
ACCUMULATED OTHER COMPREHENSI37
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Schedule of components of accumulated other comprehensive income (loss), net of tax | The components of accumulated other comprehensive income (loss), net of tax, are as follows (dollar amounts in thousands): Foreign Currency Translation Adjustments Net Unrealized Gains (Losses) On Available-For-Sale Securities Total Accumulated Other Comprehensive Loss Balance as of January 1, 2015 $ (11,464 ) $ 260 $ (11,204 ) Activity, net of tax 233 (272 ) (39 ) Balance as of December 31, 2015 (11,231 ) (12 ) (11,243 ) Activity, net of tax (16 ) (1 ) (17 ) Balance as of December 31, 2016 (11,247 ) (13 ) (11,260 ) Activity, net of tax 1,113 15 1,128 Balance as of December 31, 2017 $ (10,134 ) 2 $ (10,132 ) |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of income from continuing operations before provision (benefit) for income taxes | Income (loss) from continuing operations before provision (benefit) for income taxes are taxed under the following jurisdictions (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Domestic $ (2,211 ) $ 6,420 $ 6,290 Foreign 5,433 2,846 6,990 Total $ 3,222 $ 9,266 $ 13,280 |
Schedule of components of the provision (benefit) for income taxes | Components of the provision (benefit) for income taxes from continuing operations for each of the three years in the period ended December 31, 2017 are as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Current: Federal $ (1,240 ) $ 1,987 $ 537 State (23 ) 498 73 Foreign 4,168 5,345 4,503 Subtotal 2,905 7,830 5,113 Deferred: Federal 13,654 496 (3,624 ) State (248 ) (14 ) 430 Foreign 728 279 (179 ) Subtotal 14,134 761 (3,373 ) Total provision for income taxes $ 17,039 $ 8,591 $ 1,740 |
Schedule of differences between the statutory U.S. federal income tax rate and the provision (benefit) for income taxes, as a percentage of income before provision for income taxes | The provision (benefit) for income taxes, as a percentage of income from continuing operations before provision (benefit) for income taxes, differs from the statutory U.S. federal income tax rate due to the following: Year Ended December 31, 2017 2016 2015 Statutory U.S. federal income tax rate 35.0 % 35.0 % 35.0 % State income taxes, net of U.S. federal income tax benefit (5.5 ) 3.4 2.7 U.S. tax impact of foreign operations 1.0 (53.4 ) 2.8 Valuation allowance change 405.3 77.6 (24.5 ) Unrecognized tax benefits (91.1 ) 4.7 11.2 Domestic manufacturing deduction — (2.8 ) (1.3 ) Permanent foreign items 53.7 26.8 (7.4 ) Non-income tax contingencies — — (2.0 ) Remeasurement of deferred tax assets/liabilities 117.6 — — Elimination of provision on intercompany transactions 4.6 0.1 — Other 8.2 1.3 (3.4 ) Effective income tax rate 528.8 % 92.7 % 13.1 % |
Schedule of components of U.S. tax impact of foreign operations | Adjustments relating to the U.S. impact of foreign operations increased the effective tax rate by 1.0 percentage points in 2017 , decreased the effective tax rate by 53.4 percentage points in 2016 , and increased the effective tax rate by 2.8 percentage points in 2015 . The components of this calculation were: Components of U.S. tax impact of foreign operations 2017 2016 2015 Dividends received from foreign subsidiaries 65.7 % 65.9 % 5.4 % Foreign tax credits (4.1 ) (91.8 ) (1.1 ) Foreign tax rate differentials (60.6 ) (27.1 ) (1.2 ) Unremitted earnings — 0.2 (0.3 ) Other adjustments — (0.6 ) — Total 1.0 % (53.4 )% 2.8 % |
Schedule of significant components of the deferred tax assets (liabilities) | The significant components of the deferred tax assets (liabilities) are as follows (dollar amounts in thousands): As of December 31, 2017 2016 Inventory $ 2,268 $ 1,520 Accrued liabilities 2,190 4,178 Deferred compensation 481 498 Equity-based compensation 3,091 5,034 Intangibles assets 142 237 Bad debts 95 76 Net operating losses 13,755 7,143 Foreign tax and withholding credits 14,572 13,183 Non-income tax accruals 41 57 Health insurance accruals 125 257 Other deferred tax assets 1,869 1,735 Capital loss carryforward 82 510 Valuation allowance (24,024 ) (11,250 ) Total deferred tax assets 14,687 23,178 Other deferred tax liabilities (1,255 ) (1,597 ) Accelerated depreciation (5,919 ) — Total deferred tax liabilities (7,174 ) (1,597 ) Total deferred taxes, net $ 7,513 $ 21,581 |
Schedule of components of deferred tax assets (liabilities), net | The components of deferred tax assets (liabilities), net are as follows (dollar amounts in thousands): As of December 31, 2017 2016 Net deferred tax assets $ 8,283 $ 21,590 Net deferred tax liabilities (770 ) (9 ) Total deferred taxes, net $ 7,513 $ 21,581 |
Schedule of reconciliation of the beginning and ending amount of liabilities associated with uncertain tax benefits, excluding interest and penalties | A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax benefits, excluding interest and penalties, is as follows for the years (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Unrecognized tax benefits, opening balance $ 4,908 $ 5,825 $ 4,950 Settlement of liability reclassified as income tax payable — — (104 ) Payments on liability — — — Tax positions taken in a prior period Gross increases — — — Gross decreases (705 ) — (47 ) Tax positions taken in the current period Gross increases 716 1,182 1,252 Gross decreases — — — Lapse of applicable statute of limitations (1,970 ) (2,121 ) (69 ) Currency translation adjustments 7 22 (157 ) Unrecognized tax benefits, ending balance $ 2,956 $ 4,908 $ 5,825 |
CAPITAL TRANSACTIONS (Tables)
CAPITAL TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of stock option activity | Stock option activity for 2017 , 2016 , and 2015 consisted of the following (share amounts in thousands, except for per share information): Number of Shares Weighted Average Exercise Price Per Share Options outstanding at January 1, 2015 2,037 $ 11.69 Granted 335 14.04 Forfeited or canceled (284 ) 14.07 Exercised (405 ) 9.78 Options outstanding at December 31, 2015 1,683 12.21 Granted — — Forfeited or canceled (124 ) 11.95 Exercised (35 ) 4.74 Options outstanding at December 31, 2016 1,524 12.41 Granted 25 13.50 Forfeited or canceled (142 ) 14.69 Exercised (17 ) 12.06 Options outstanding at December 31, 2017 1,390 $ 12.20 |
Schedule of weighted-average assumptions using Black-Scholes option-pricing model for estimating fair value of each option granted | The fair value of each option grant was estimated on the date of the grant using the Black-Scholes option-pricing model with the following weighted average assumptions for the years ended December 31, 2017 , 2016 , and 2015 : 2017 2016 2015 Weighted average grant date fair value of grants $ 4.94 $ — $ 4.79 Expected life (in years) 5.0 — 5.0 to 6.0 Risk-free interest rate 1.8 — 1.5 to 1.8 Expected volatility 39.8 — 42.6 to 52.3 Dividend yield — — 2.8 to 3.6 |
Summary of options outstanding and exercisable | The following table summarizes information about options outstanding and exercisable at December 31, 2017 (share amounts in thousands, except per share information): Options Outstanding Options Exercisable Range of Option Prices Per Share Options Outstanding Weighted-Avg. Remaining Contractual Life Weighted-Avg. Exercise Price Per Share Options Exercisable Weighted-Avg. Remaining Contractual Life Weighted-Avg. Exercise Price Per Share $2.35 to $9.99 152 2.3 $ 5.38 152 2.3 $ 5.38 $10.00 to $13.99 938 4.9 12.42 903 4.9 12.36 $14.00 to $17.70 300 6.7 14.98 238 6.6 15.17 1,390 1,293 |
Schedule of restricted stock unit activity | Restricted stock unit activity for the period ended December 31, 2017 , 2016 , and 2015 is as follows: (share amounts in thousands, except per share information): Number of Shares Weighted Average Grant Date Fair Value Units outstanding at January 1, 2015 180 $ 15.09 Granted 679 12.61 Issued (30 ) 13.63 Forfeited (85 ) 12.84 Units outstanding at December 31, 2015 744 12.48 Granted 281 9.49 Issued (154 ) 13.05 Forfeited (33 ) 12.20 Units outstanding at December 31, 2016 838 11.39 Granted 274 12.62 Issued (187 ) 12.23 Forfeited (197 ) 12.07 Units outstanding at December 31, 2017 728 11.56 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of approximate aggregate commitments under non-cancelable operating leases | The approximate aggregate commitments under non-cancelable operating leases in effect at December 31, 2017 , were as follows (dollar amounts in thousands): Year Ending December 31, 2018 $ 5,918 2019 3,210 2020 2,604 2021 2,139 2022 2,042 Thereafter 12,148 Total $ 28,061 |
OPERATING BUSINESS SEGMENT AN41
OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of reportable business segment information | Reportable business segment information for the years ended December 31, 2017 , 2016 , and 2015 is as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Net sales: NSP Americas $ 166,017 $ 175,922 $ 179,151 NSP Russia, Central and Eastern Europe 32,190 29,998 31,469 Synergy WorldWide 123,833 124,793 114,081 NSP China 19,989 10,446 4 Total net sales 342,029 341,159 324,705 Contribution margin (1): NSP Americas 69,408 75,005 74,953 NSP Russia, Central and Eastern Europe 10,930 10,525 11,340 Synergy WorldWide 35,377 38,034 35,277 NSP China 15,307 6,748 4 Total contribution margin 131,022 130,312 121,574 Selling, general and administrative (2) 129,635 120,273 107,702 Operating income 1,387 10,039 13,872 Other income (loss), net 1,835 (773 ) (592 ) Income from continuing operations before provision for income taxes $ 3,222 $ 9,266 $ 13,280 ___________________________ (1) Contribution margin consists of net sales less cost of sales and volume incentives expense. (2) Service fees in the NSP China segment related to sales in China, occurring after the Company's receipt of its direct selling license and pre-opening sales through Hong Kong, totaled $7.2 million , $4.3 million, and $0 for the years ended December 31, 2017 , 2016 , and 2015 , respectively. These service fees are included in the Company's selling, general and administrative expenses. Year Ended December 31, 2017 2016 2015 Capital expenditures: NSP Americas $ 3,965 $ 8,999 $ 21,437 NSP Russia, Central and Eastern Europe 55 131 — Synergy WorldWide 763 564 302 NSP China 603 430 487 Total capital expenditures $ 5,386 $ 10,124 $ 22,226 Depreciation and amortization: NSP Americas $ 7,884 $ 3,997 $ 3,603 NSP Russia, Central and Eastern Europe 60 42 26 Synergy WorldWide 621 713 885 NSP China 69 56 11 Total depreciation and amortization $ 8,634 $ 4,808 $ 4,525 As of December 31, 2017 2016 Assets: NSP Americas $ 127,246 $ 146,761 NSP Russia, Central and Eastern Europe 6,664 6,106 Synergy WorldWide 44,047 39,083 NSP China 17,238 13,620 Total assets $ 195,195 $ 205,570 |
Schedule of consolidated net sales revenue by geographical locations | From an individual country perspective, only the United States and South Korea comprises approximately 10 percent or more of consolidated net sales for any of the years ended December 31, 2017 , 2016 , and 2015 as follows (dollar amounts in thousands): Year Ended December 31, 2017 2016 2015 Net sales: United States $ 140,860 $ 148,060 $ 147,553 South Korea 52,020 57,637 48,476 Other 149,149 135,462 128,676 Total net sales $ 342,029 $ 341,159 $ 324,705 |
Schedule of revenue generated by each of the Company's product lines | Revenue generated by each of the Company’s product lines is set forth below (dollars in thousands): Year Ended December 31, 2017 2016 2015 NSP Americas: General health $ 74,492 $ 78,187 $ 80,315 Immunity 20,451 19,185 22,042 Cardiovascular 11,454 12,677 12,331 Digestive 45,231 47,659 49,239 Personal care 7,260 7,537 3,575 Weight management 7,129 10,677 11,649 166,017 175,922 179,151 NSP Russia, Central and Eastern Europe: General health $ 14,813 $ 12,907 $ 13,332 Immunity 3,530 3,349 3,853 Cardiovascular 2,166 2,212 2,006 Digestive 8,261 8,009 8,178 Personal care 2,330 2,370 2,809 Weight management 1,090 1,151 1,291 32,190 29,998 31,469 Synergy WorldWide: General health $ 31,973 $ 35,283 $ 43,829 Immunity 508 620 752 Cardiovascular 50,702 51,684 34,191 Digestive 16,121 12,536 17,746 Personal care 8,532 8,981 5,697 Weight management 15,997 15,689 11,866 123,833 124,793 114,081 NSP China: General health $ 3,738 $ 1,551 $ 4 Immunity 468 370 — Cardiovascular 3,886 2,617 — Digestive 8,361 4,323 — Personal care 350 629 — Weight management 3,186 956 — 19,989 10,446 4 Total net sales $ 342,029 $ 341,159 $ 324,705 |
Schedule of consolidated property, plant and equipment by geographical locations | From an individual country perspective, only the United States comprise 10 percent or more of consolidated property, plant and equipment as follows (dollar amounts in thousands): As of December 31 2017 2016 Property, plant and equipment United States $ 65,928 $ 70,770 Other 3,178 2,502 Total property, plant and equipment $ 69,106 $ 73,272 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of the Company's hierarchy for assets measured at fair value on a recurring basis | The following table presents the Company’s hierarchy for its asset measured at fair value on a recurring basis as of December 31, 2017 (dollar amounts in thousands): Level 1 Level 2 Level 3 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Total Investment securities - trading $ 1,980 — — $ 1,980 Total assets measured at fair value on a recurring basis $ 1,980 $ — $ — $ 1,980 The following table presents the Company’s hierarchy for its asset measured at fair value on a recurring basis as of December 31, 2016 : Level 1 Level 2 Level 3 Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Total Investments available-for-sale U.S. government security funds $ 1,776 — — $ 1,776 Investment securities - trading 1,391 — — 1,391 Total assets measured at fair value on a recurring basis $ 3,167 $ — $ — $ 3,167 |
SUMMARY OF QUARTERLY OPERATIO43
SUMMARY OF QUARTERLY OPERATIONS - UNAUDITED (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of the Company's unaudited summary of quarterly operations | The following tables presents the Company’s unaudited summary of quarterly operations during 2017 and 2016 for each of three month periods ended March 31, June 30, September 30, and December 31 (dollar amounts in thousands, except per share information). For the Quarter Ended March 31, June 30, September 30, December 31, Net sales $ 83,098 $ 81,344 $ 89,301 $ 88,286 Cost of sales (21,728 ) (21,197 ) (23,505 ) (24,607 ) Gross profit 61,370 60,147 65,796 63,679 Volume incentives 28,983 28,288 30,716 31,983 Selling, general and administrative 30,336 31,836 32,926 34,537 Operating income (loss) 2,051 23 2,154 (2,841 ) Other income (expense) 1,275 441 193 (74 ) Income (loss) before income taxes 3,326 464 2,347 (2,915 ) Provision (benefit) for income taxes 1,463 884 (1 ) 14,693 Net income (loss) 1,863 (420 ) 2,348 (17,608 ) Net loss attributable to noncontrolling interests (297 ) (233 ) (95 ) (250 ) Net income (loss) attributable to common shareholders $ 2,160 $ (187 ) $ 2,443 $ (17,358 ) Basic and diluted net income (loss) per common share: Basic earnings (loss) per share attributable to common shareholders: $ 0.11 $ (0.01 ) $ 0.13 $ (0.92 ) Diluted earnings (loss) per share attributable to common shareholders: $ 0.11 $ (0.01 ) $ 0.13 $ (0.92 ) Dividends declared per common share $ 0.10 $ — $ — $ — Basic and diluted income (loss) per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly net income (loss) per share may not equal the total computed for the year. During the fourth quarter of 2017, the Company's provision for income taxes was affected by an addition of valuation allowances on U.S. foreign tax credits as a result of the Tax Reform Act, re-measurement of deferred tax assets and liabilities from 35 percent to 21 percent, and the impact of current year foreign losses that will not provide tax benefit. The Company’s provision for income taxes is discussed in further detail in Note 11. For the Quarter Ended March 31, June 30, September 30, December 31, Net sales $ 82,402 $ 89,366 $ 85,441 $ 83,950 Cost of sales (22,020 ) (23,078 ) (21,512 ) (24,327 ) Gross profit 60,382 66,288 63,929 59,623 Volume incentives 29,877 30,791 29,684 29,558 Selling, general and administrative 28,385 31,249 29,187 31,452 Operating income (loss) 2,120 4,248 5,058 (1,387 ) Other income (expense), net 1,559 (622 ) 20 (1,730 ) Income (loss) before income taxes 3,679 3,626 5,078 (3,117 ) Provision for income taxes 1,890 1,260 1,136 4,305 Net income (loss) 1,789 2,366 3,942 (7,422 ) Net loss attributable to noncontrolling interests (280 ) (202 ) (213 ) (769 ) Net income (loss) attributable to common shareholders $ 2,069 $ 2,568 $ 4,155 $ (6,653 ) Basic and diluted net income (loss) per common share: Basic earnings (loss) per share attributable to common shareholders: $ 0.11 $ 0.14 $ 0.22 $ (0.35 ) Diluted earnings (loss) per share attributable to common shareholders: $ 0.11 $ 0.14 $ 0.22 $ (0.35 ) Dividends declared per common share $ 0.10 $ 0.10 $ 0.10 $ 0.10 |
NATURE OF OPERATIONS AND SIGN44
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property, Plant and Equipment | ||
Investment in information systems | $ 128,778 | $ 125,274 |
Buildings | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 20 years | |
Buildings | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 50 years | |
Building improvements | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 7 years | |
Building improvements | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Machinery and equipment | ||
Property, Plant and Equipment | ||
Investment in information systems | $ 25,160 | 23,699 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 2 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Computer software and hardware | ||
Property, Plant and Equipment | ||
Investment in information systems | $ 51,632 | 49,340 |
Computer software and hardware | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 3 years | |
Computer software and hardware | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Furniture and fixtures | ||
Property, Plant and Equipment | ||
Investment in information systems | $ 20,385 | $ 19,962 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 2 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment | ||
Estimated useful lives | 5 years | |
Technology Equipment | ||
Property, Plant and Equipment | ||
Estimated useful lives | 10 years | |
Investment in information systems | $ 48,500 |
NATURE OF OPERATIONS AND SIGN45
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible Assets | ||
Intangible assets, net of accumulated amortization | $ 709 | $ 976 |
Product formulations | ||
Intangible Assets | ||
Intangible assets, net of accumulated amortization | $ 700 | $ 1,000 |
Product formulations | Minimum | ||
Intangible Assets | ||
Estimated economic lives | 9 years | |
Product formulations | Maximum | ||
Intangible Assets | ||
Estimated economic lives | 15 years |
NATURE OF OPERATIONS AND SIGN46
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details 3) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Incentive Trip Accrual | |||||||||||
Convention and meeting costs | $ 4,970 | $ 5,129 | $ 4,970 | $ 5,129 | |||||||
Foreign Currency Translation | |||||||||||
Minimum cumulative inflation rate for considering a country to have a highly inflationary economy (as a percent) | 100.00% | ||||||||||
Period of cumulative inflation rate for considering a country to have a highly inflationary economy | 3 years | ||||||||||
Revenue Recognition | |||||||||||
Period for amortization membership fees | 1 year | ||||||||||
Period for sales return from date of purchase | 90 days | ||||||||||
Sales return | $ 1,600 | 1,400 | $ 1,200 | ||||||||
Shipping and handling revenues | 8,200 | 9,200 | 9,200 | ||||||||
Advertising Costs | |||||||||||
Advertising costs | 2,100 | 1,900 | 2,200 | ||||||||
Research and Development | |||||||||||
Research and development expenses | 3,400 | 3,200 | 2,800 | ||||||||
Segment information | |||||||||||
Foreign tax and withholding credits | $ 14,572 | 13,183 | $ 14,572 | 13,183 | |||||||
Options Outstanding (in shares) | 1,390 | 1,390 | |||||||||
Net income (loss) attributable to common shareholders: | |||||||||||
Net income (loss) from continuing operations | $ (12,942) | 2,139 | 12,571 | ||||||||
Income from discontinued operations | 0 | 0 | 2,116 | ||||||||
Net income (loss) attributable to common shareholders | $ (17,358) | $ 2,443 | $ (187) | $ 2,160 | $ (6,653) | $ 4,155 | $ 2,568 | $ 2,069 | $ (12,942) | $ 2,139 | $ 14,687 |
Basic weighted-average shares outstanding | |||||||||||
Basic weighted-average shares outstanding | 18,882 | 18,731 | 18,656 | ||||||||
Basic earnings (loss) per share attributable to common shareholders: | |||||||||||
Net income (loss) from continuing operations (in dollars per share) | $ (0.69) | $ 0.11 | $ 0.67 | ||||||||
Income from discontinued operations (in dollars per share) | 0 | 0 | 0.11 | ||||||||
Net Income (loss) per common share attributable to shareholders (in dollars per share) | $ (0.92) | $ 0.13 | $ (0.01) | $ 0.11 | $ (0.35) | $ 0.22 | $ 0.14 | $ 0.11 | $ (0.69) | $ 0.11 | $ 0.79 |
Diluted Shares Outstanding | |||||||||||
Basic weighted-average shares outstanding | 18,882 | 18,731 | 18,656 | ||||||||
Stock-based awards (in shares) | 0 | 325 | 521 | ||||||||
Diluted weighted-average shares outstanding | 18,882 | 19,056 | 19,177 | ||||||||
Diluted earnings (loss) per share attributable to common shareholders: | |||||||||||
Net income (loss) from continuing operations (in dollars per share) | $ (0.69) | $ 0.11 | $ 0.66 | ||||||||
Income from discontinued operations (in dollars per share) | 0 | 0 | 0.11 | ||||||||
Net Income (loss) per common share attributable to shareholders (in dollars per share) | $ (0.92) | $ 0.13 | $ (0.01) | $ 0.11 | $ (0.35) | $ 0.22 | $ 0.14 | $ 0.11 | $ (0.69) | $ 0.11 | $ 0.77 |
Potentially dilutive shares excluded from diluted per share amounts: | |||||||||||
Stock options (in shares) | 0 | 288 | 345 | ||||||||
Potentially anti-dilutive shares excluded from diluted per share amounts: | |||||||||||
Stock options (in shares) | 2,118 | 1,347 | 688 | ||||||||
RSUs | |||||||||||
Segment information | |||||||||||
RSU's outstanding (in shares) | 728 | 728 |
NATURE OF OPERATIONS AND SIGN47
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details 4) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Time-based stock options | Maximum | |||
Share Based Compensation | |||
Vesting period | 48 months | ||
Performance based stock options operating income margins | |||
Share Based Compensation | |||
Operating income margin, one (as a percent) | 6.00% | ||
Operating income margin, two (as a percent) | 8.00% | ||
Operating income margin, three (as a percent) | 10.00% | ||
RSUs | 2012 Stock Incentive Plan | |||
Share Based Compensation | |||
Vesting period | 1 year | 1 year | 1 year |
RSUs | 2012 Stock Incentive Plan | Board of Directors | |||
Share Based Compensation | |||
Vesting period based on achieving annual net sales targets | 1 year | ||
Restriction period | 2 years | ||
RSUs | 2012 Stock Incentive Plan | Minimum | |||
Share Based Compensation | |||
Vesting period | 12 months | ||
RSUs | 2012 Stock Incentive Plan | Maximum | |||
Share Based Compensation | |||
Vesting period | 48 months |
NATURE OF OPERATIONS AND SIGN48
NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES (Details 5) - USD ($) $ in Millions | Jan. 01, 2018 | Dec. 31, 2016 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Long-term deferred tax assets | $ 21.6 | |
Scenario, Previously Reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Long-term deferred tax assets | 16 | |
Accounting Standards Update 2015-07 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Deferred tax assets, net, current | $ (5.6) | |
Subsequent Event | Retained Earnings (Accumulated deficit) | Accounting Standards Update 2014-09 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative effect of new accounting principle | $ 0.8 |
DISCONTINUED OPERATIONS (Detail
DISCONTINUED OPERATIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Discontinued operations | |||
Income from discontinued operations | $ 0 | $ 0 | $ 2,116 |
Proceeds from sale of fixed assets | $ 521 | $ 0 | 3,128 |
Subsidiary in Venezuela | |||
Discontinued operations | |||
Net sales revenue | 0 | ||
Income before income tax provision | 2,604 | ||
Income tax provision (benefit) | 488 | ||
Income from discontinued operations | 2,116 | ||
Proceeds from sale of fixed assets | 1,300 | ||
Operations in Brazil | |||
Discontinued operations | |||
Settlement of accrued liabilities | $ 1,300 |
RESTRUCTURING RELATED EXPENSE50
RESTRUCTURING RELATED EXPENSES (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Apr. 30, 2015position | Dec. 31, 2017position | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||||
Number of positions eliminated | position | 100 | 60 | ||||
Restructuring expenses | $ 1,483 | $ 200 | $ 3,306 | |||
Selling, General and Administrative Expenses | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring expenses | $ 1,500 | 3,300 | ||||
Selling, General and Administrative Expenses | PHILIPPINES | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring expenses | $ 200 | |||||
Selling, General and Administrative Expenses | Severance and termination benefits | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring expenses | $ 800 | 2,800 | ||||
Selling, General and Administrative Expenses | Other exit costs | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring expenses | $ 500 |
RESTRUCTURING RELATED EXPENSE51
RESTRUCTURING RELATED EXPENSES (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring Reserve [Roll Forward] | ||||
Liability balance at beginning of period | $ 49 | $ 844 | $ 0 | |
Increase in liability | 1,483 | 200 | $ 3,306 | |
Reduction in liability (payments) | (782) | (995) | (2,462) | |
Liability balance at end of period | $ 750 | $ 49 | $ 844 | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 9,522 | $ 14,995 |
Work in progress | 2,153 | 694 |
Finished goods | 32,372 | 31,908 |
Total inventory | $ 44,047 | $ 47,597 |
PROPERTY, PLANT AND EQUIPMENT53
PROPERTY, PLANT AND EQUIPMENT (Details) | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 31, 2017a | |
Property, plant and equipment | ||||
Property, plant and equipment, gross | $ 128,778,000 | $ 125,274,000 | ||
Accumulated depreciation and amortization | (59,672,000) | (52,002,000) | ||
Total property, plant and equipment | 69,106,000 | 73,272,000 | ||
Depreciation expense | 8,500,000 | 4,700,000 | $ 4,400,000 | |
Interest costs capitalized | 100,000 | 199,000 | $ 0 | |
Real estate held for sale | 500,000 | |||
Impairment of real estate | 200,000 | |||
Land and improvements | ||||
Property, plant and equipment | ||||
Property, plant and equipment, gross | 841,000 | 1,996,000 | ||
Buildings and improvements | ||||
Property, plant and equipment | ||||
Property, plant and equipment, gross | 30,760,000 | 30,277,000 | ||
Machinery and equipment | ||||
Property, plant and equipment | ||||
Property, plant and equipment, gross | 25,160,000 | 23,699,000 | ||
Furniture and fixtures | ||||
Property, plant and equipment | ||||
Property, plant and equipment, gross | 20,385,000 | 19,962,000 | ||
Computer software and hardware | ||||
Property, plant and equipment | ||||
Property, plant and equipment, gross | $ 51,632,000 | $ 49,340,000 | ||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Property, plant and equipment | ||||
Acre of land | a | 53 |
(Details)
(Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Intangible assets | |||
Net amount | $ 709 | $ 976 | |
Amortization expense for intangible assets | 200 | 100 | $ 100 |
Estimated Amortization Expense | |||
2,018 | 186 | ||
2,019 | 186 | ||
2,020 | 186 | ||
2,021 | 134 | ||
2,022 | 17 | ||
Total | 709 | ||
Product formulations | |||
Intangible assets | |||
Gross carrying amount | 1,800 | 1,900 | |
Accumulated amortization | 1,100 | 900 | |
Net amount | $ 700 | 1,000 | |
Product formulations | Minimum | |||
Intangible assets | |||
Estimated useful lives | 9 years | ||
Product formulations | Maximum | |||
Intangible assets | |||
Estimated useful lives | 15 years | ||
Blue Hat Product Registrations | |||
Intangible assets | |||
Gross carrying amount | $ 500 | ||
Impairment of Intangible Assets, Finite-lived | $ 100 | ||
Blue Hat Product Registrations | Minimum | |||
Intangible assets | |||
Estimated useful lives | 3 years | ||
Blue Hat Product Registrations | Maximum | |||
Intangible assets | |||
Estimated useful lives | 5 years |
INVESTMENT SECURITIES (Details)
INVESTMENT SECURITIES (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Investment securities | |
Amortized Cost | $ 1,799 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | (23) |
Fair Value | 1,776 |
U.S. government security funds | |
Investment securities | |
Amortized Cost | 1,799 |
Gross Unrealized Gains | 0 |
Gross Unrealized Losses | (23) |
Fair Value | $ 1,776 |
INVESTMENT SECURITIES (Narrativ
INVESTMENT SECURITIES (Narrative) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |||
Proceeds from the sales of available-for-sale securities | $ 1,776,000 | $ 5,000 | $ 810,000 |
Gross realized gains (losses) on sales of available-for-sale securities (net of tax) | 300,000 | 0 | |
Trading securities portfolio | 1,980,000 | 1,391,000 | |
Trading securities, realized gain (loss) | $ 200,000 | $ 100,000 | $ (5,000) |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Salaries and employee benefits | $ 10,289 | $ 10,670 |
Sales, use and property tax (See Note 14) | 3,367 | 2,376 |
Convention and meeting costs | 4,970 | 5,129 |
Other | 6,354 | 6,225 |
Total | $ 24,980 | $ 24,400 |
REVOLVING CREDIT FACILITY (Deta
REVOLVING CREDIT FACILITY (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Jul. 11, 2017 | |
Bank of America | |||
Long-term debt | |||
Effective rate (as a percent) | 282.00% | ||
Annual commitment fee (as a percent) | 20.00% | ||
Outstanding balance | $ 13,200,000 | ||
Bank of America | LIBOR | |||
Long-term debt | |||
Margin on variable rate (as a percent) | 125.00% | ||
Bank of America | Revolving credit agreement | |||
Long-term debt | |||
Maximum borrowing capacity | $ 25,000,000 | ||
Wells Fargo | |||
Long-term debt | |||
Effective rate (as a percent) | 213.00% | ||
Annual commitment fee (as a percent) | 25.00% | ||
Outstanding balance | $ 9,900,000 | ||
Wells Fargo | LIBOR | |||
Long-term debt | |||
Margin on variable rate (as a percent) | 125.00% |
ACCUMULATED OTHER COMPREHENSI59
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Activity, net of tax | $ 1,128 | $ (17) | $ (39) |
Foreign Currency Translation Adjustments | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at the beginning of the period | (11,247) | (11,231) | (11,464) |
Activity, net of tax | 1,113 | (16) | 233 |
Balance at the end of the period | (10,134) | (11,247) | (11,231) |
AOCI Attributable to Parent | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at the beginning of the period | (11,260) | (11,243) | (11,204) |
Activity, net of tax | 1,128 | (17) | (39) |
Balance at the end of the period | (10,132) | (11,260) | (11,243) |
Equity Securities | Net Unrealized Gains (Losses) On Available-For-Sale Securities | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Balance at the beginning of the period | (13) | (12) | 260 |
Activity, net of tax | 15 | (1) | (272) |
Balance at the end of the period | $ 2 | $ (13) | $ (12) |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income from continuing operations before provision (benefit) for income taxes | |||||||||||
Domestic | $ (2,211) | $ 6,420 | $ 6,290 | ||||||||
Foreign | 5,433 | 2,846 | 6,990 | ||||||||
Income from continuing operations before provision for income taxes | $ (2,915) | $ 2,347 | $ 464 | $ 3,326 | $ (3,117) | $ 5,078 | $ 3,626 | $ 3,679 | 3,222 | 9,266 | 13,280 |
Current: | |||||||||||
Federal | (1,240) | 1,987 | 537 | ||||||||
State | (23) | 498 | 73 | ||||||||
Foreign | 4,168 | 5,345 | 4,503 | ||||||||
Subtotal | 2,905 | 7,830 | 5,113 | ||||||||
Deferred: | |||||||||||
Federal | 13,654 | 496 | (3,624) | ||||||||
State | (248) | (14) | 430 | ||||||||
Foreign | 728 | 279 | (179) | ||||||||
Subtotal | 14,134 | 761 | (3,373) | ||||||||
Total provision (benefit) for income taxes | $ 14,693 | $ (1) | $ 884 | $ 1,463 | $ 4,305 | $ 1,136 | $ 1,260 | $ 1,890 | $ 17,039 | $ 8,591 | $ 1,740 |
Differences between the statutory U.S. federal income tax rate and the provision for income taxes from continuing operations, as a percentage of income before provision for income taxes | |||||||||||
Statutory U.S. federal income tax rate (as a percent) | 35.00% | 35.00% | 35.00% | ||||||||
State income taxes, net of U.S. federal income tax benefit (as a percent) | (5.50%) | 3.40% | 2.70% | ||||||||
U.S. tax impact of foreign operations (as a percent) | 1.00% | (53.40%) | 2.80% | ||||||||
Valuation allowance change (as a percent) | 405.30% | 77.60% | (24.50%) | ||||||||
Unrecognized tax benefits (as a percent) | (91.10%) | 4.70% | 11.20% | ||||||||
Domestic manufacturing deduction (as a percent) | (0.00%) | (2.80%) | (1.30%) | ||||||||
Permanent foreign items | 53.70% | 26.80% | (7.40%) | ||||||||
Non-income tax contingencies (as a percent) | (0.00%) | (0.00%) | (2.00%) | ||||||||
Remeasurement of deferred tax assets/liabilities | 117.60% | ||||||||||
Elimination of provision on intercompany transactions | 4.60% | 0.10% | |||||||||
Other (as a percent) | 8.20% | 1.30% | (3.40%) | ||||||||
Effective income tax rate (as a percent) | 528.80% | 92.70% | 13.10% | ||||||||
Components of U.S. tax impact of foreign operations | |||||||||||
Dividends received from foreign subsidiaries (as a percent) | 65.70% | 65.90% | 5.40% | ||||||||
Foreign tax credits (as a percent) | (4.10%) | (91.80%) | (1.10%) | ||||||||
Foreign tax rate differential (as a percent) | (60.60%) | (27.10%) | (1.20%) | ||||||||
Unremitted earnings (as a percent) | (0.00%) | 0.20% | (0.30%) | ||||||||
Other adjustments (as a percent) | (0.00%) | (0.60%) | (0.00%) | ||||||||
U.S. tax impact of foreign operations (as a percent) | 1.00% | (53.40%) | 2.80% |
INCOME TAXES (Details 3)
INCOME TAXES (Details 3) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Significant components of the deferred tax assets (liabilities) | ||
Inventory | $ 2,268 | $ 1,520 |
Accrued liabilities | 2,190 | 4,178 |
Deferred compensation | 481 | 498 |
Equity-based compensation | 3,091 | 5,034 |
Intangibles assets | 142 | 237 |
Bad debts | 95 | 76 |
Net operating losses | 13,755 | 7,143 |
Foreign tax and withholding credits | 14,572 | 13,183 |
Non-income tax accruals | 41 | 57 |
Health insurance accruals | 125 | 257 |
Other deferred tax assets | 1,869 | 1,735 |
Capital loss carryforward | 82 | 510 |
Valuation allowance | (24,024) | (11,250) |
Total deferred tax assets | 14,687 | 23,178 |
Other deferred tax liabilities | (1,255) | (1,597) |
Accelerated depreciation | (5,919) | 0 |
Total deferred tax liabilities | (7,174) | (1,597) |
Total deferred taxes, net | 7,513 | 21,581 |
Components of deferred tax assets (liabilities), net | ||
Net deferred tax assets | 8,283 | 21,590 |
Net deferred tax liabilities | (770) | (9) |
Total deferred taxes, net | 7,513 | 21,581 |
Valuation allowance | ||
Tax Cuts And Jobs Act Of 2017, incomplete accounting, change in tax rate, deferred tax assets for foreign tax credits, valuation allowance | 9,900 | |
Tax Cuts And Jobs Act Of 2017, incomplete accounting, change in tax rate, deferred tax asset, provisional income tax expense | 3,800 | |
Increase in valuation allowance | 12,800 | |
Foreign tax and withholding credits | 14,572 | 13,183 |
Net operating losses | 13,755 | $ 7,143 |
Domestic | ||
Significant components of the deferred tax assets (liabilities) | ||
Net operating losses | 4,600 | |
Valuation allowance | ||
Increase in valuation allowance | 10,800 | |
Net operating losses | 4,600 | |
Foreign | ||
Significant components of the deferred tax assets (liabilities) | ||
Net operating losses | 9,200 | |
Foreign tax and withholding credits | 14,200 | |
Valuation allowance | ||
Increase in valuation allowance | 2,000 | |
Foreign tax and withholding credits | 14,200 | |
Net operating losses | $ 9,200 |
INCOME TAXES (Details 4)
INCOME TAXES (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Unrecognized tax benefits | |||
Outstanding balance for liabilities related to unrecognized tax benefits, which if recognized, would affect the effective tax rate | $ 4,600 | $ 6,800 | |
Interest and penalties included in the outstanding balance for liabilities related to unrecognized tax benefits | 1,700 | 1,800 | |
Increase (decrease) in interest and penalties | (200) | 100 | |
Increase in liability for unrecognized tax benefits | 900 | 1,400 | $ 1,600 |
Interest expense and penalties included in increase in liability for unrecognized tax benefits | 100 | 300 | 300 |
Benefit related to the lapse of applicable statute of limitations | 2,300 | 2,500 | 100 |
Reconciliation of the beginning and ending amount of liabilities associated with uncertain tax benefits, excluding interest and penalties | |||
Unrecognized tax benefits, opening balance | 4,908 | 5,825 | 4,950 |
Settlement of liability reclassified as income tax payable | 0 | 0 | (104) |
Payments on liability | 0 | 0 | 0 |
Tax positions taken in a prior period | |||
Gross increases | 0 | 0 | 0 |
Gross decreases | (705) | 0 | (47) |
Tax positions taken in the current period | |||
Gross increases | 716 | 1,182 | 1,252 |
Gross decreases | 0 | 0 | 0 |
Lapse of applicable statute of limitations | (1,970) | (2,121) | (69) |
Currency translation adjustments, increase | 7 | 22 | |
Currency translation adjustments, decrease | (157) | ||
Unrecognized tax benefits, ending balance | $ 2,956 | $ 4,908 | $ 5,825 |
INCOME TAXES (Details 5)
INCOME TAXES (Details 5) | Dec. 31, 2017USD ($) |
Commissions and transfer pricing | Minimum | |
Anticipated change in unrecognized tax benefits | |
Increase in unrecognized tax benefits within the next twelve months | $ 200,000 |
Commissions and transfer pricing | Maximum | |
Anticipated change in unrecognized tax benefits | |
Increase in unrecognized tax benefits within the next twelve months | 600,000 |
Audits or the expiration of statutes of limitations in various foreign jurisdictions | Minimum | |
Anticipated change in unrecognized tax benefits | |
Decrease in unrecognized tax benefits within the next twelve months | 0 |
Audits or the expiration of statutes of limitations in various foreign jurisdictions | Maximum | |
Anticipated change in unrecognized tax benefits | |
Decrease in unrecognized tax benefits within the next twelve months | $ 200,000 |
CAPITAL TRANSACTIONS Share-Base
CAPITAL TRANSACTIONS Share-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 03, 2017 | Mar. 07, 2017 | Dec. 05, 2016 | Nov. 02, 2016 | Sep. 02, 2016 | Aug. 05, 2016 | Jun. 06, 2016 | May 10, 2016 | Mar. 22, 2016 | Feb. 24, 2016 | Jan. 31, 2015 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||
Cash dividend per common share (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0 | $ 0 | $ 0 | $ 0.1 | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.10 | $ 0.4 | $ 0.4 | |||||||
Dividend paid | $ 1,800 | $ 1,900 | $ 1,900 | $ 1,900 | $ 1,900 | $ 1,848 | $ 7,509 | $ 7,490 | |||||||||||||||
Repurchase of common stock (in shares) | 0 | 0 | 501,000 | ||||||||||||||||||||
2012 Stock Incentive Plan | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||
Number of shares authorized under the plan | 1,500,000 | 1,500,000 | |||||||||||||||||||||
Additional number of shares authorized under the plan | 1,500,000 | ||||||||||||||||||||||
2009 Incentive Plan | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||
Number of shares authorized under the plan | 400,000 | 400,000 | |||||||||||||||||||||
2014 Share Repurchase Program 2014 | |||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||||||||
Stock repurchase program, authorized amount | $ 20,000 |
CAPITAL TRANSACTIONS Stock Opti
CAPITAL TRANSACTIONS Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Time-based stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 200 | $ 800 | $ 1,600 | |
Unrecognized share-based compensation expense, options | $ 13 | $ 300 | $ 1,100 | |
Weighted-average period over which the remaining compensation cost is expected to be recognized | 2 months | |||
Time-based stock options | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 48 months | |||
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 25,000 | 0 | 335,000 | |
Granted (in dollars per share) | $ 13.50 | $ 0 | $ 14.04 | |
Weighted-average grant date fair value (in dollars per share) | $ 4.94 | $ 4.79 | ||
Aggregate intrinsic values of options exercised | $ 17 | $ 200 | $ 1,400 | |
Related tax benefit | $ 17 | $ 100 | $ 500 | |
Outstanding options to purchase (in shares) | 1,390,000 | 1,524,000 | 1,683,000 | 2,037,000 |
Exercisable (in shares) | 1,293,000 | 1,201,000 | ||
Expected to vest (in shares) | 92,000 | 306,000 | ||
Aggregate Intrinsic value, outstanding | $ 900 | $ 4,200 | ||
Aggregate Intrinsic value, exercisable | 900 | 3,700 | ||
Aggregate Intrinsic value, expected to vest | $ 0 | $ 386 | ||
Performance based stock options operating income margins | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Operating income margin, one (as a percent) | 6.00% | |||
Operating income margin, two (as a percent) | 8.00% | |||
Operating income margin, three (as a percent) | 10.00% | |||
2012 Stock Incentive Plan | Time-based stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 25,000 | |||
2012 Stock Incentive Plan | Time-based stock options and net sales revenue performance-based stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in dollars per share) | $ 13.50 | |||
Termination period | 10 years | |||
2012 Stock Incentive Plan | Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 17,000 | 35,000 | 405,000 | |
Granted (in dollars per share) | $ 12.06 | $ 4.74 | $ 9.78 | |
2009 Incentive Plan | Time-based stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in shares) | 335,000 | |||
2009 Incentive Plan | Time-based stock options and net sales revenue performance-based stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in dollars per share) | $ 14.04 | |||
Weighted-average grant date fair value (in dollars per share) | $ 4.79 | |||
Termination period | 10 years |
CAPITAL TRANSACTIONS Stock Op66
CAPITAL TRANSACTIONS Stock Option Activity (Details) - Stock options - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of shares | |||
Options outstanding at the beginning of the period (in shares) | 1,524,000 | 1,683,000 | 2,037,000 |
Granted (in shares) | 25,000 | 0 | 335,000 |
Forfeited or canceled (in shares) | (142,000) | (124,000) | (284,000) |
Exercised (in shares) | (17,000) | (35,000) | (405,000) |
Options outstanding at the end of the period (in shares) | 1,390,000 | 1,524,000 | 1,683,000 |
Weighted Average Exercise Price Per Share | |||
Options outstanding at the beginning of the period (in dollars per share) | $ 12.41 | $ 12.21 | $ 11.69 |
Granted (in dollars per share) | 13.50 | 0 | 14.04 |
Forfeited or canceled (in dollars per share) | 14.69 | 11.95 | 14.07 |
Exercised (in dollars per share) | 12.06 | 4.74 | 9.78 |
Options outstanding at the end of the period (in dollars per share) | $ 12.20 | $ 12.41 | $ 12.21 |
CAPITAL TRANSACTIONS Black-Scho
CAPITAL TRANSACTIONS Black-Scholes Option-Pricing Model (Details) - Stock options - $ / shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Weighted-average grant date fair value (in dollars per share) | $ 4.94 | $ 4.79 |
Expected life | 5 years | |
Risk-free interest rate (as a percent) | 1.80% | |
Expected volatility (as a percent) | 39.80% | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 5 years | |
Risk-free interest rate (as a percent) | 1.50% | |
Expected volatility (as a percent) | 42.60% | |
Dividend yield (as a percent) | 2.80% | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected life | 6 years | |
Risk-free interest rate (as a percent) | 1.80% | |
Expected volatility (as a percent) | 52.30% | |
Dividend yield (as a percent) | 3.60% |
CAPITAL TRANSACTIONS Restricted
CAPITAL TRANSACTIONS Restricted Stock Unit Activity (Details) - RSUs - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Number of Shares | |||
Units outstanding at the end of the period (in shares) | 728,000 | ||
2012 Stock Incentive Plan | |||
Number of Shares | |||
Units outstanding at the beginning of the period (in shares) | 838,000 | 744,000 | 180,000 |
Granted (in shares) | 274,000 | 281,000 | 679,000 |
Issued (in shares) | (187,000) | (154,000) | (30,000) |
Forfeited or canceled (in shares) | (197,000) | (33,000) | (85,000) |
Units outstanding at the end of the period (in shares) | 728,000 | 838,000 | 744,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Units outstanding at the beginning of the period (in dollars per share) | $ 11.39 | $ 12.48 | $ 15.09 |
Granted (in dollars per share) | 12.62 | 9.49 | 12.61 |
Issued (in dollars per share) | 12.23 | 13.05 | 13.63 |
Forfeited or canceled (in dollars per share) | 12.07 | 12.20 | 12.84 |
Units outstanding at the end of the period (in dollars per share) | $ 11.56 | $ 11.39 | $ 12.48 |
CAPITAL TRANSACTIONS Schedule o
CAPITAL TRANSACTIONS Schedule of Options Outstanding and Exercisable (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Options Outstanding | |
Options Outstanding (in shares) | shares | 1,390 |
Stock options | |
Options Outstanding | |
Options Outstanding (in shares) | shares | 1,390 |
Weighted-Avg. Remaining Contractual Life | |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | |
Options Exercisable | |
Options Exercisable (in shares) | shares | 1,293 |
Weighted-Avg. Remaining Contractual Life | |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | |
$2.35 to $9.99 | Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of option prices per share, lower limit (in dollars per share) | 2.35 |
Range of option prices per share, upper limit (in dollars per share) | $ 9.99 |
Options Outstanding | |
Options Outstanding (in shares) | shares | 152 |
Weighted-Avg. Remaining Contractual Life | 2 years 3 months 19 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 5.38 |
Options Exercisable | |
Options Exercisable (in shares) | shares | 152 |
Weighted-Avg. Remaining Contractual Life | 2 years 3 months 18 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 5.38 |
$10.00 to $13.99 | Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of option prices per share, lower limit (in dollars per share) | 10 |
Range of option prices per share, upper limit (in dollars per share) | $ 13.99 |
Options Outstanding | |
Options Outstanding (in shares) | shares | 938 |
Weighted-Avg. Remaining Contractual Life | 4 years 10 months 24 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 12.42 |
Options Exercisable | |
Options Exercisable (in shares) | shares | 903 |
Weighted-Avg. Remaining Contractual Life | 4 years 10 months 24 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 12.36 |
$14.00 to $17.70 | Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of option prices per share, lower limit (in dollars per share) | 14 |
Range of option prices per share, upper limit (in dollars per share) | $ 17.70 |
Options Outstanding | |
Options Outstanding (in shares) | shares | 300 |
Weighted-Avg. Remaining Contractual Life | 6 years 8 months 12 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 14.98 |
Options Exercisable | |
Options Exercisable (in shares) | shares | 238 |
Weighted-Avg. Remaining Contractual Life | 6 years 7 months 6 days |
Weighted-Avg. Exercise Price Per Share (in dollars per share) | $ 15.17 |
CAPITAL TRANSACTIONS Restrict70
CAPITAL TRANSACTIONS Restricted Stock Units (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2017USD ($)installment$ / sharesshares | Dec. 31, 2016USD ($)installment$ / sharesshares | Dec. 31, 2015USD ($)installment$ / sharesshares | |
RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Finnerty Model discount for lack of marketability | 11.90% | ||
Share-based compensation expense | $ | $ 2 | $ 2.4 | $ 2.9 |
Unrecognized share-based compensation expense, options | $ | $ 1.3 | $ 2 | |
Weighted-average period over which the remaining compensation expense is expected to be recognized | 1 year 2 months | ||
Unrecognized share-based compensation expense, other than options | $ | $ 3.5 | ||
Minimum statutory withholding requirements that the Company pays on behalf of its employees | shares | 43,000 | 20,000 | |
2012 Stock Incentive Plan | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | 1 year | 1 year |
Granted (in shares) | shares | 274,000 | 281,000 | 679,000 |
Granted (in dollars per share) | $ / shares | $ 12.62 | $ 9.49 | $ 12.61 |
Number of monthly installments for vesting of stock awards | installment | 12 | 12 | 12 |
2012 Stock Incentive Plan | RSUs | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 12 months | ||
2012 Stock Incentive Plan | RSUs | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 48 months | ||
2012 Stock Incentive Plan | Time-based RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | 3 years | |
Granted (in dollars per share) | $ / shares | $ 12.29 | $ 10.06 | |
2012 Stock Incentive Plan | Performance-based RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | 3 years | 3 years |
Granted (in dollars per share) | $ / shares | $ 13.35 | $ 8.16 | $ 12.13 |
2012 Stock Incentive Plan | Board of Directors | RSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restriction period | 2 years | ||
Number of shares subject to restriction period | shares | 96,000 | 69,000 |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
401(k) plans | |||
Employer's matching contribution (as a percent) | 70.00% | 70.00% | |
Maximum contribution by employer as a percentage of employee's compensation | 5.00% | 5.00% | |
Employer's matching contribution before change (as a percent) | 60.00% | ||
Vesting period of employer's contributions | 3 years | ||
Contributions by employer | $ 1.1 | $ 1.1 | $ 0.9 |
Nonqualified deferred compensation plan | |||
Maximum percentage of annual salary and bonus that may be deferred | 100.00% | ||
Period for payment of obligation upon separation, one | 3 years | ||
Period for payment of obligation upon separation, two | 5 years | ||
Deferred compensation plan assets | $ 2 | $ 1.4 |
COMMITMENTS AND CONTINGENCIES72
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Expenses incurred under operating leases | $ 7,400 | $ 6,600 | $ 6,300 |
Aggregate commitments under non-cancelable operating leases | |||
2,018 | 5,918 | ||
2,019 | 3,210 | ||
2,020 | 2,604 | ||
2,021 | 2,139 | ||
2,022 | 2,042 | ||
Thereafter | 12,148 | ||
Total | $ 28,061 |
COMMITMENTS AND CONTINGENCIES73
COMMITMENTS AND CONTINGENCIES (Details 2) | 12 Months Ended | ||
Dec. 31, 2017USD ($)claim | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Commitments and contingencies | |||
Payment made to third party | $ 10,000 | $ 100,000 | $ 100,000 |
Non Income Tax | |||
Commitments and contingencies | |||
Accrued liabilities | 400,000 | 300,000 | |
Non Income Tax | Minimum | |||
Commitments and contingencies | |||
Estimate of possible loss | 0 | ||
Non Income Tax | Maximum | |||
Commitments and contingencies | |||
Estimate of possible loss | $ 4,000,000 | ||
Value-added tax assessments and other civil litigation | |||
Commitments and contingencies | |||
Minimum number of claims that the Company's insurance coverage may not be sufficient to cover | claim | 1 | ||
Accrued litigation expense | $ 1,500,000 | ||
Provision for losses | 0 | ||
Value-added tax assessments and other civil litigation | Minimum | |||
Commitments and contingencies | |||
Estimate of possible loss | 0 | ||
Value-added tax assessments and other civil litigation | Maximum | |||
Commitments and contingencies | |||
Estimate of possible loss | 1,900,000 | ||
Product liability and employee medical claims | |||
Commitments and contingencies | |||
Accrued liabilities | 1,500,000 | 2,400,000 | |
Accrued liabilities classified as short-term | 600,000 | $ 700,000 | |
Manufacturing Equipment and Leasehold Improvements | |||
Commitments and contingencies | |||
Other commitments in 2018 | $ 1,700,000 |
OPERATING BUSINESS SEGMENT AN74
OPERATING BUSINESS SEGMENT AND INTERNATIONAL OPERATION INFORMATION (Details) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($)segment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Segment information | |||||||||||
Number of business segments | segment | 4 | ||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | $ 88,286,000 | $ 89,301,000 | $ 81,344,000 | $ 83,098,000 | $ 83,950,000 | $ 85,441,000 | $ 89,366,000 | $ 82,402,000 | $ 342,029,000 | $ 341,159,000 | $ 324,705,000 |
Contribution margin: | |||||||||||
Total contribution margin | 131,022,000 | 130,312,000 | 121,574,000 | ||||||||
Selling, general and administrative | 34,537,000 | 32,926,000 | 31,836,000 | 30,336,000 | 31,452,000 | 29,187,000 | 31,249,000 | 28,385,000 | 129,635,000 | 120,273,000 | 107,702,000 |
Operating income | (2,841,000) | 2,154,000 | 23,000 | 2,051,000 | (1,387,000) | 5,058,000 | 4,248,000 | 2,120,000 | 1,387,000 | 10,039,000 | 13,872,000 |
Other income (expense) | (74,000) | 193,000 | 441,000 | 1,275,000 | (1,730,000) | 20,000 | (622,000) | 1,559,000 | 1,835,000 | (773,000) | (592,000) |
Income from continuing operations before provision for income taxes | (2,915,000) | $ 2,347,000 | $ 464,000 | $ 3,326,000 | (3,117,000) | $ 5,078,000 | $ 3,626,000 | $ 3,679,000 | 3,222,000 | 9,266,000 | 13,280,000 |
Capital expenditures: | |||||||||||
Total capital expenditures | 5,386,000 | 10,124,000 | 22,226,000 | ||||||||
Depreciation and amortization: | |||||||||||
Total depreciation and amortization | 8,634,000 | 4,808,000 | 4,525,000 | ||||||||
Assets: | |||||||||||
Total Assets | 195,195,000 | 205,570,000 | 195,195,000 | 205,570,000 | |||||||
Property, plant and equipment | |||||||||||
Total property, plant and equipment | 69,106,000 | 73,272,000 | 69,106,000 | 73,272,000 | |||||||
United States | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 140,860,000 | 148,060,000 | 147,553,000 | ||||||||
Property, plant and equipment | |||||||||||
Total property, plant and equipment | 65,928,000 | 70,770,000 | 65,928,000 | 70,770,000 | |||||||
South Korea | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 52,020,000 | 57,637,000 | 48,476,000 | ||||||||
Other | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 149,149,000 | 135,462,000 | 128,676,000 | ||||||||
Property, plant and equipment | |||||||||||
Total property, plant and equipment | 3,178,000 | 2,502,000 | 3,178,000 | 2,502,000 | |||||||
Selling, General and Administrative Expenses | |||||||||||
Contribution margin: | |||||||||||
Service fees | 7,200,000 | 4,300,000 | 0 | ||||||||
NSP Americas | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 166,017,000 | 175,922,000 | 179,151,000 | ||||||||
Contribution margin: | |||||||||||
Total contribution margin | 69,408,000 | 75,005,000 | 74,953,000 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 3,965,000 | 8,999,000 | 21,437,000 | ||||||||
Depreciation and amortization: | |||||||||||
Total depreciation and amortization | 7,884,000 | 3,997,000 | 3,603,000 | ||||||||
Assets: | |||||||||||
Total Assets | 127,246,000 | 146,761,000 | 127,246,000 | 146,761,000 | |||||||
NSP Americas | General health | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 74,492,000 | 78,187,000 | 80,315,000 | ||||||||
NSP Americas | Immune | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 20,451,000 | 19,185,000 | 22,042,000 | ||||||||
NSP Americas | Cardiovascular | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 11,454,000 | 12,677,000 | 12,331,000 | ||||||||
NSP Americas | Digestive | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 45,231,000 | 47,659,000 | 49,239,000 | ||||||||
NSP Americas | Personal care | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 7,260,000 | 7,537,000 | 3,575,000 | ||||||||
NSP Americas | Weight management | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 7,129,000 | 10,677,000 | 11,649,000 | ||||||||
NSP Russia, Central and Eastern Europe | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 32,190,000 | 29,998,000 | 31,469,000 | ||||||||
Contribution margin: | |||||||||||
Total contribution margin | 10,930,000 | 10,525,000 | 11,340,000 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 55,000 | 131,000 | 0 | ||||||||
Depreciation and amortization: | |||||||||||
Total depreciation and amortization | 60,000 | 42,000 | 26,000 | ||||||||
Assets: | |||||||||||
Total Assets | 6,664,000 | 6,106,000 | 6,664,000 | 6,106,000 | |||||||
NSP Russia, Central and Eastern Europe | General health | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 14,813,000 | 12,907,000 | 13,332,000 | ||||||||
NSP Russia, Central and Eastern Europe | Immune | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 3,530,000 | 3,349,000 | 3,853,000 | ||||||||
NSP Russia, Central and Eastern Europe | Cardiovascular | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 2,166,000 | 2,212,000 | 2,006,000 | ||||||||
NSP Russia, Central and Eastern Europe | Digestive | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 8,261,000 | 8,009,000 | 8,178,000 | ||||||||
NSP Russia, Central and Eastern Europe | Personal care | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 2,330,000 | 2,370,000 | 2,809,000 | ||||||||
NSP Russia, Central and Eastern Europe | Weight management | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 1,090,000 | 1,151,000 | 1,291,000 | ||||||||
Synergy WorldWide | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 123,833,000 | 124,793,000 | 114,081,000 | ||||||||
Contribution margin: | |||||||||||
Total contribution margin | 35,377,000 | 38,034,000 | 35,277,000 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 763,000 | 564,000 | 302,000 | ||||||||
Depreciation and amortization: | |||||||||||
Total depreciation and amortization | 621,000 | 713,000 | 885,000 | ||||||||
Assets: | |||||||||||
Total Assets | 44,047,000 | 39,083,000 | 44,047,000 | 39,083,000 | |||||||
Synergy WorldWide | General health | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 31,973,000 | 35,283,000 | 43,829,000 | ||||||||
Synergy WorldWide | Immune | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 508,000 | 620,000 | 752,000 | ||||||||
Synergy WorldWide | Cardiovascular | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 50,702,000 | 51,684,000 | 34,191,000 | ||||||||
Synergy WorldWide | Digestive | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 16,121,000 | 12,536,000 | 17,746,000 | ||||||||
Synergy WorldWide | Personal care | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 8,532,000 | 8,981,000 | 5,697,000 | ||||||||
Synergy WorldWide | Weight management | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 15,997,000 | 15,689,000 | 11,866,000 | ||||||||
NSP China | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 19,989,000 | 10,446,000 | 4,000 | ||||||||
Contribution margin: | |||||||||||
Total contribution margin | 15,307,000 | 6,748,000 | 4,000 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 603,000 | 430,000 | 487,000 | ||||||||
Depreciation and amortization: | |||||||||||
Total depreciation and amortization | 69,000 | 56,000 | 11,000 | ||||||||
Assets: | |||||||||||
Total Assets | $ 17,238,000 | $ 13,620,000 | 17,238,000 | 13,620,000 | |||||||
NSP China | General health | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 3,738,000 | 1,551,000 | 4,000 | ||||||||
NSP China | Immune | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 468,000 | 370,000 | 0 | ||||||||
NSP China | Cardiovascular | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 3,886,000 | 2,617,000 | 0 | ||||||||
NSP China | Digestive | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 8,361,000 | 4,323,000 | 0 | ||||||||
NSP China | Personal care | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | 350,000 | 629,000 | 0 | ||||||||
NSP China | Weight management | |||||||||||
Net sales revenue: | |||||||||||
Total net sales revenue | $ 3,186,000 | $ 956,000 | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Dec. 09, 2008 | Mar. 16, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Executives | ||||
Related Party Transactions | ||||
Cash surrender value of split-dollar life insurance policies | $ 15 | $ 15 | ||
Corporate Joint Venture | China | ||||
Related Party Transactions | ||||
Payments for advance to affiliate | 2,000 | |||
Payments for advance to affiliate by co-venturer | $ 500 | |||
Mr. Eugene Hughes | Retirement and Consulting Agreement | ||||
Related Party Transactions | ||||
Initial term of agreement | 8 years | |||
Annual compensation for the first two years of service | $ 200 | |||
Specified service period for annual compensation | 2 years | |||
Annual compensation for remainder of the initial term | $ 100 | |||
Corporate Joint Venture | China | ||||
Related Party Transactions | ||||
Debt instrument, term (in years) | 1 year | |||
Interest rate, stated percentage | 300.00% | |||
Subsequent Event | Corporate Joint Venture | China | ||||
Related Party Transactions | ||||
Payments for advance to affiliate by co-venturer | $ 2,000 |
FAIR VALUE (Details)
FAIR VALUE (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair value | ||
Investments available-for-sale | $ 1,776 | |
U.S. government security funds | ||
Fair value | ||
Investments available-for-sale | 1,776 | |
Recurring basis | Level 1 - Quoted Prices in Active Markets for Identical Assets | ||
Fair value | ||
Investment securities - trading | $ 1,980 | 1,391 |
Total assets measured at fair value on a recurring basis | 1,980 | 3,167 |
Recurring basis | Level 1 - Quoted Prices in Active Markets for Identical Assets | U.S. government security funds | ||
Fair value | ||
Investments available-for-sale | 1,776 | |
Recurring basis | Level 2 - Significant Other Observable Inputs | ||
Fair value | ||
Investment securities - trading | 0 | 0 |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Recurring basis | Level 2 - Significant Other Observable Inputs | U.S. government security funds | ||
Fair value | ||
Investments available-for-sale | 0 | |
Recurring basis | Level 3 - Significant Unobservable Inputs | ||
Fair value | ||
Investment securities - trading | 0 | 0 |
Total assets measured at fair value on a recurring basis | 0 | 0 |
Recurring basis | Level 3 - Significant Unobservable Inputs | U.S. government security funds | ||
Fair value | ||
Investments available-for-sale | 0 | |
Total | Recurring basis | ||
Fair value | ||
Investment securities - trading | 1,980 | 1,391 |
Total assets measured at fair value on a recurring basis | $ 1,980 | 3,167 |
Total | Recurring basis | U.S. government security funds | ||
Fair value | ||
Investments available-for-sale | $ 1,776 |
SUMMARY OF QUARTERLY OPERATIO77
SUMMARY OF QUARTERLY OPERATIONS - UNAUDITED (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 07, 2017 | Nov. 02, 2016 | Aug. 05, 2016 | May 10, 2016 | Feb. 24, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Net sales | $ 88,286 | $ 89,301 | $ 81,344 | $ 83,098 | $ 83,950 | $ 85,441 | $ 89,366 | $ 82,402 | $ 342,029 | $ 341,159 | $ 324,705 | |||||
Cost of sales | (24,607) | (23,505) | (21,197) | (21,728) | (24,327) | (21,512) | (23,078) | (22,020) | (91,037) | (90,937) | (85,345) | |||||
Gross profit | 63,679 | 65,796 | 60,147 | 61,370 | 59,623 | 63,929 | 66,288 | 60,382 | 250,992 | 250,222 | 239,360 | |||||
Volume incentives | 31,983 | 30,716 | 28,288 | 28,983 | 29,558 | 29,684 | 30,791 | 29,877 | 119,970 | 119,910 | 117,786 | |||||
Selling, general and administrative | 34,537 | 32,926 | 31,836 | 30,336 | 31,452 | 29,187 | 31,249 | 28,385 | 129,635 | 120,273 | 107,702 | |||||
Operating income (loss) | (2,841) | 2,154 | 23 | 2,051 | (1,387) | 5,058 | 4,248 | 2,120 | 1,387 | 10,039 | 13,872 | |||||
Other income (expense) | (74) | 193 | 441 | 1,275 | (1,730) | 20 | (622) | 1,559 | 1,835 | (773) | (592) | |||||
Income from continuing operations before provision for income taxes | (2,915) | 2,347 | 464 | 3,326 | (3,117) | 5,078 | 3,626 | 3,679 | 3,222 | 9,266 | 13,280 | |||||
Provision for income taxes | 14,693 | (1) | 884 | 1,463 | 4,305 | 1,136 | 1,260 | 1,890 | 17,039 | 8,591 | 1,740 | |||||
Net income (loss) | (17,608) | 2,348 | (420) | 1,863 | (7,422) | 3,942 | 2,366 | 1,789 | (13,817) | 675 | 13,656 | |||||
Net loss attributable to noncontrolling interests | (250) | (95) | (233) | (297) | (769) | (213) | (202) | (280) | (875) | (1,464) | (1,031) | |||||
Net income (loss) attributable to common shareholders | $ (17,358) | $ 2,443 | $ (187) | $ 2,160 | $ (6,653) | $ 4,155 | $ 2,568 | $ 2,069 | $ (12,942) | $ 2,139 | $ 14,687 | |||||
Basic earnings (loss) per share attributable to common shareholders: | ||||||||||||||||
Basic earnings (loss) per share attributable to common shareholders (in dollars per share) | $ (0.92) | $ 0.13 | $ (0.01) | $ 0.11 | $ (0.35) | $ 0.22 | $ 0.14 | $ 0.11 | $ (0.69) | $ 0.11 | $ 0.79 | |||||
Diluted earnings (loss) per share attributable to common shareholders: | ||||||||||||||||
Diluted earnings (loss) per share attributable to common shareholders (in dollars per share) | (0.92) | 0.13 | (0.01) | 0.11 | (0.35) | 0.22 | 0.14 | 0.11 | (0.69) | 0.11 | 0.77 | |||||
Dividends declared per common share (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0.10 | $ 0 | $ 0 | $ 0 | $ 0.1 | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.10 | $ 0.4 | $ 0.4 |
SCHEDULE II - VALUATION AND Q78
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for doubtful accounts receivable | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | $ 205 | $ 190 | $ 849 |
Provisions | 556 | 305 | 83 |
Amounts Written Off | (366) | (290) | (714) |
Amounts Recovered | 0 | 0 | 0 |
Effect of Currency Translation | 0 | 0 | (28) |
Balance at End of Year | 395 | 205 | 190 |
Allowance for sales returns | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 156 | 94 | 129 |
Provisions | 1,746 | 1,435 | 1,126 |
Amounts Written Off | (1,644) | (1,368) | (1,155) |
Amounts Recovered | 0 | 0 | 0 |
Effect of Currency Translation | 12 | (5) | (6) |
Balance at End of Year | 270 | 156 | 94 |
Tax valuation allowance | |||
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | 11,250 | 6,565 | 13,169 |
Provisions | 13,786 | 5,638 | (6,088) |
Amounts Written Off | 0 | (493) | 0 |
Amounts Recovered | (865) | 0 | 0 |
Effect of Currency Translation | (147) | (460) | (516) |
Balance at End of Year | $ 24,024 | $ 11,250 | $ 6,565 |