Document and Entity Information
Document and Entity Information Document - USD ($) | 12 Months Ended | ||
Feb. 28, 2023 | May 11, 2023 | Aug. 31, 2022 | |
Document Information [Line Items] | |||
Entity Registrant Name | VOXX INTERNATIONAL CORPORATION | ||
Entity Trading Symbol | VOXX | ||
Entity Central Index Key | 0000807707 | ||
Current Fiscal Year End Date | --02-28 | ||
Entity Filer Category | Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Feb. 28, 2023 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Entity Interactive Data Current | Yes | ||
Title of 12(b) Security | Class A Common Stock $.01 par value | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 0-28839 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 13-1964841 | ||
Entity Address, City or Town | Orlando | ||
Entity Address, State or Province | FL | ||
Entity Address Postal Zip Code | 32824 | ||
City Area Code | 800 | ||
Local Phone Number | 645-7750 | ||
Entity Address, Address Line One | 2351 J. Lawson Boulevard | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Amendment Flag | false | ||
Entity Public Float | $ 117,482,697 | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Auditor Firm ID | 248 | ||
Auditor Name | GRANT THORNTON LLP | ||
Auditor Location | Melville, New York | ||
Documents Incorporated by Reference | Part III - (Items 10, 11, 12, 13 and 14) Proxy Statement for Annual Meeting of Stockholders to be filed on or before June 8, 2023 | ||
Class A Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 20,916,138 | ||
Class B Common Stock [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 2,260,954 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 6,134 | $ 27,788 |
Accounts receivable, net | 82,753 | 105,625 |
Inventory, net | 175,129 | 174,922 |
Receivables from vendors | 112 | 363 |
Prepaid expenses and other current assets | 19,817 | 21,340 |
Income tax receivable | 1,076 | 734 |
Total current assets | 285,021 | 330,772 |
Investment securities | 1,053 | 1,231 |
Equity investments | 22,018 | 21,348 |
Property, plant and equipment, net | 47,044 | 49,794 |
Operating lease, right of use asset | 3,632 | 4,464 |
Goodwill | 65,308 | 74,320 |
Intangible assets, net | 90,437 | 101,450 |
Deferred income tax assets | 1,218 | 40 |
Other assets | 3,720 | 3,245 |
Total assets | 519,451 | 586,664 |
Current liabilities: | ||
Accounts payable | 35,099 | 76,665 |
Accrued expenses and other current liabilities | 41,856 | 53,974 |
Income taxes payable | 2,276 | 2,714 |
Accrued sales incentives | 21,778 | 23,755 |
Contingent consideration, current (Note 2) | 4,500 | 685 |
Interim arbitration award payable (Note 15) | 43,388 | 39,444 |
Contract liabilities, current | 3,990 | 4,373 |
Current portion of long-term debt | 500 | 2,406 |
Total current liabilities | 153,387 | 204,016 |
Long-term debt, net of debt issuance costs | 37,513 | 9,786 |
Finance lease liabilities, less current portion | 63 | 78 |
Operating lease liabilities, less current portion | 2,509 | 3,298 |
Deferred compensation | 1,053 | 1,231 |
Contingent consideration, less current portion (Note 2) | 0 | 5,750 |
Deferred income tax liabilities | 4,855 | 5,300 |
Other tax liabilities | 966 | 1,083 |
Prepaid ownership interest in EyeLock LLC due to GalvanEyes LLC (Note 3) | 7,317 | 2,451 |
Other long-term liabilities | 2,947 | 3,508 |
Total liabilities | 210,610 | 236,501 |
Commitments and contingencies (Note 15) | ||
Redeemable equity (Note 1(u)) | 4,018 | 3,550 |
Redeemable non-controlling interest (Note 2) | 232 | 511 |
Stockholders' equity: | ||
Preferred stock: | ||
Paid-in capital | 296,577 | 300,453 |
Retained earnings | 97,997 | 126,573 |
Accumulated other comprehensive loss | (18,680) | (17,503) |
Less: Treasury stock, at cost, 3,370,657 and 2,862,218 shares of Class A Common Stock at February 28, 2023 and February 28, 2022, respectively | (30,285) | (25,138) |
Less: Redeemable equity | (4,018) | (3,550) |
Total VOXX International Corporation stockholders' equity | 341,859 | 381,102 |
Non-controlling interest | (37,268) | (35,000) |
Total stockholders' equity | 304,591 | 346,102 |
Total liabilities, redeemable equity, redeemable non-controlling interest, and stockholders' equity | 519,451 | 586,664 |
Common Class B [Member] | ||
Stockholders' equity: | ||
Common stock | 22 | 22 |
Common Class A [Member] | ||
Stockholders' equity: | ||
Common stock | $ 246 | $ 245 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Feb. 28, 2023 | Feb. 28, 2022 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury stock, shares | 3,370,657 | 2,862,218 |
Common Class A [Member] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 24,538,184 | 24,476,847 |
Common stock, shares outstanding | 21,167,527 | 21,614,629 |
Treasury stock, shares | 3,370,657 | 2,862,218 |
Common Class B [Member] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 2,260,954 | 2,260,954 |
Common stock, shares outstanding | 2,260,954 | 2,260,954 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | |||||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | ||||
Income Statement [Abstract] | ||||||
Net sales | $ 534,014,000 | $ 635,920,000 | $ 563,605,000 | |||
Cost of sales | 399,715,000 | 466,442,000 | 405,058,000 | |||
Gross profit | 134,299,000 | 169,478,000 | 158,547,000 | |||
Operating expenses: | ||||||
Selling | 46,967,000 | 50,507,000 | 43,786,000 | |||
General and administrative | 74,508,000 | 75,955,000 | 69,798,000 | |||
Engineering and technical support | 31,464,000 | 31,540,000 | 20,897,000 | |||
Acquisition costs | (36,000) | 3,552,000 | 287,000 | |||
Goodwill impairment charge | 7,373,000 | 0 | 0 | |||
Intangible asset impairment charges | 1,300,000 | 1,300,000 | ||||
Total operating expenses | 161,576,000 | 161,554,000 | 136,068,000 | |||
Operating (loss) income | (27,277,000) | 7,924,000 | 22,479,000 | |||
Other (expense) income: | ||||||
Interest and bank charges | (4,643,000) | (2,532,000) | (2,979,000) | |||
Equity in income of equity investee | 6,969,000 | 7,890,000 | 7,350,000 | |||
Interim arbitration award (Note 15) | (3,944,000) | (39,444,000) | ||||
Investment gain (Note 1(f)) | 42,000 | |||||
Other, net | (2,055,000) | 323,000 | 746,000 | |||
Total other (expense) income, net | (3,673,000) | (33,763,000) | 5,159,000 | |||
(Loss) income before income taxes | (30,950,000) | [1],[2],[3] | (25,839,000) | [1] | 27,638,000 | [4] |
Income tax (benefit) expense | (39,000) | 1,626,000 | 4,272,000 | |||
Net (loss) income | (30,911,000) | (27,465,000) | 23,366,000 | |||
Less: net loss attributable to non-controlling interest | (2,335,000) | (5,132,000) | (3,401,000) | |||
Net (loss) income attributable to VOXX International Corporation | (28,576,000) | (22,333,000) | 26,767,000 | |||
Other comprehensive (loss) income: | ||||||
Foreign currency translation adjustments | (1,876,000) | (3,317,000) | 4,365,000 | |||
Derivatives designated for hedging, net of tax | 309,000 | 633,000 | (305,000) | |||
Pension plan adjustments, net of tax | 390,000 | 158,000 | 18,000 | |||
Other comprehensive (loss) income, net of tax | (1,177,000) | (2,526,000) | 4,078,000 | |||
Comprehensive (loss) income attributable to VOXX International Corporation | $ (29,753,000) | $ (24,859,000) | $ 30,845,000 | |||
Net (loss) income per common share attributable to VOXX International Corporation - basic | $ (1.17) | $ (0.92) | $ 1.11 | |||
Net (loss) income per common share attributable to VOXX International Corporation - diluted | $ (1.17) | $ (0.92) | $ 1.09 | |||
Weighted-average common shares outstanding (basic) | 24,325,938 | 24,287,179 | 24,201,221 | |||
Weighted-average common shares outstanding (diluted) | 24,325,938 | 24,287,179 | 24,650,106 | |||
[1] Included within Income (loss) before income taxes within Corporate/Eliminations for the year ended February 28, 2022 is a charge of $ 39,444 recorded for an interim arbitration award unfavorable to the Company (see Note 15). Included within Loss before income taxes on Corporate/Eliminations for the year ended February 28, 2023 are interest charges of $ 3,944 related to the interim arbitration award. Included within Loss before income taxes within Corporate/Eliminations for the year ended February 28, 2023 are foreign currency losses of $ 3,267 attributable to the Company's Onkyo subsidiary related to intercompany transactions and financial statement translation adjustments. Included within Loss before income taxes within the Automotive Electronics segment for the year ended February 28, 2023 is a goodwill impairment charge of $ 7,373 and an intangible asset impairment charge of $ 1,300 (see Note 1(k)) . Included within Income (loss) before income taxes within the Consumer Electronics segment for the year ended February 28, 2021 is an intangible asset impairment charge of $ 1,300 (see Note 1(k)). |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive (Loss) Income [Member] | Non-controlling Interests [Member] | Treasury Stock [Member] | Redeemable Equity [Member] Preferred Stock [Member] |
Stockholders equity, beginning of period at Feb. 29, 2020 | $ 348,229 | $ 266 | $ 299,228 | $ 122,139 | $ (19,055) | $ (27,950) | $ (23,918) | $ (2,481) |
Net income (loss) | 23,366 | 26,767 | (3,401) | |||||
Other comprehensive income (loss), net of tax | 4,078 | 4,078 | ||||||
Settlement of SERP restricted stock units | (575) | (575) | ||||||
Stock-based compensation expense | 971 | 1 | 1,749 | (779) | ||||
Stockholders equity, end of period at Feb. 28, 2021 | 376,069 | 267 | 300,402 | 148,906 | (14,977) | (31,351) | (23,918) | (3,260) |
Net income (loss) | (25,982) | (22,333) | (3,649) | |||||
Other comprehensive income (loss), net of tax | (2,526) | (2,526) | ||||||
Settlement of shares of Class A Common Stock upon vesting of stock awards, net of withholding taxes | (856) | (856) | ||||||
Repurchase of shares of Class A Common Stock | (1,220) | (1,220) | ||||||
Stock-based compensation expense | 617 | 907 | (290) | |||||
Stockholders equity, end of period at Feb. 28, 2022 | 346,102 | 267 | 300,453 | 126,573 | (17,503) | (35,000) | (25,138) | (3,550) |
Net income (loss) | (30,844) | (28,576) | (2,268) | |||||
Other comprehensive income (loss), net of tax | (1,177) | (1,177) | ||||||
Cash settlement of market stock units upon vesting of 80% of award | (4,000) | (4,000) | ||||||
Settlement of SERP restricted stock units | (81) | (81) | ||||||
Settlement of shares of Class A Common Stock upon vesting of stock awards, net of withholding taxes | (403) | 1 | (404) | |||||
Repurchase of shares of Class A Common Stock | (5,147) | (5,147) | ||||||
Reclassification of stockholders' equity to redeemable equity | 63 | 63 | ||||||
Stock-based compensation expense | 78 | 609 | (531) | |||||
Stockholders equity, end of period at Feb. 28, 2023 | $ 304,591 | $ 268 | $ 296,577 | $ 97,997 | $ (18,680) | $ (37,268) | $ (30,285) | $ (4,018) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - shares | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Percentage of cash settlement of market stock units upon vesting of award | 80% | |
Common Class A [Member] | ||
Shares issued upon vesting of stock awards | 61,337 | 60,693 |
Repurchase of shares of common stock | 508,439 | 113,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Cash flows from operating activities: | |||
Net (loss) income | $ (30,911) | $ (27,465) | $ 23,366 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | |||
Depreciation and amortization | 13,130 | 12,398 | 11,033 |
Amortization of deferred financing costs | 262 | 272 | 623 |
Impairment charges | 8,673 | 0 | 1,300 |
Bad debt (recovery) expense | (86) | 222 | (316) |
Reduction in the carrying amount of the right of use asset | 1,508 | 1,383 | 1,169 |
(Gain) loss on forward contracts | (61) | 209 | 224 |
Equity in income of equity investee | (6,969) | (7,890) | (7,350) |
Distribution of income from equity investees | 6,300 | 9,809 | 6,009 |
Deferred income tax (benefit) expense, net | (1,793) | (1,339) | 2,653 |
Loss on disposal of property, plant and equipment | 11 | 1 | |
Non-cash compensation adjustment | (178) | (546) | (505) |
Non-cash stock-based compensation expense | 609 | 907 | 1,749 |
Gain on investment | (42) | ||
Changes in operating assets and liabilities (net of assets and liabilities) acquired): | |||
Accounts receivable | 21,482 | (1,244) | (29,602) |
Inventory | (1,928) | (45,115) | (22,735) |
Receivables from vendors | 248 | (89) | (44) |
Prepaid expenses and other | 1,322 | (1,610) | (10,753) |
Investment securities-equity | 178 | 546 | 505 |
Accounts payable, accrued expenses, accrued sales incentives and other current liabilities | (49,246) | 55,719 | 59,414 |
Income taxes receivable/payable | (759) | 872 | (87) |
Net cash (used in) provided by operating activities | (38,208) | (2,960) | 36,611 |
Cash flows from investing activities: | |||
Purchases of property, plant and equipment | (3,557) | (3,902) | (2,907) |
Proceeds from sale of property, plant and equipment | 1 | ||
Proceeds from sale of long-term investment | 42 | ||
Purchase of acquired businesses (Note 2) | (30,406) | (11,000) | |
Net cash used in investing activities | (3,556) | (34,308) | (13,865) |
Cash flows from financing activities: | |||
Borrowings from bank obligations | 202,983 | 3,687 | 20,000 |
Repayments on bank obligations | (176,257) | (2,197) | (20,500) |
Principal payments on finance lease obligations | (287) | (407) | (605) |
Deferred financing costs | (398) | (667) | (260) |
Payment of market stock unit awards | (4,000) | ||
Withholding taxes paid on net issuance of stock award | (404) | (857) | |
Settlement payment of restricted stock units | (81) | (575) | |
Proceeds of the issuance of subsidiary shares to non-controlling interest | 2,069 | ||
Proceeds of the issuance of long-term debt to non-controlling interest | 4,877 | ||
Purchase of treasury stock | (5,147) | (1,220) | |
Net cash provided by (used in) financing activities | 16,409 | 5,285 | (1,940) |
Effect of exchange rate changes on cash | 3,701 | 367 | 1,173 |
Net (decrease) increase in cash and cash equivalents | (21,654) | (31,616) | 21,979 |
Cash and cash equivalents at beginning of year | 27,788 | 59,404 | 37,425 |
Cash and cash equivalents at end of year | 6,134 | 27,788 | 59,404 |
Non-cash investing and financing activities: | |||
Adjustments to goodwill due to measurement period adjustments, net | 1,051 | (1,353) | 21 |
Gross issuance of shares | 1 | 1 | 1 |
Contingent purchase price consideration in connection with business acquisition | 6,778 | ||
Settlement of debt with receivables | 607 | ||
Recording of redeemable equity | (63) | 290 | 779 |
Reclassification of stockholders' equity to redeemable equity | 531 | ||
Right of use assets obtained in exchange for operating lease obligations | 1,016 | 1,238 | 772 |
Property, plant, and equipment obtained in exchange for finance lease obligations | 251 | ||
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating cash flows from operating leases | 1,401 | 1,383 | 1,169 |
Operating cash flows from finance leases | 4 | 11 | 28 |
Financing cash flows from finance leases | 287 | 407 | 605 |
Interest, excluding bank charges | 2,813 | 760 | 1,101 |
Income taxes (net of refunds) | $ 2,603 | $ 1,983 | $ 1,807 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | 1) Description of Business and Summary of Significant Accounting Policies a) Description of Business VOXX International Corporation ("Voxx," "We," "Our," "Us" or the “Company") is a leading international manufacturer and distributor in the Automotive Electronics, Consumer Electronics, and Biometrics industries. The Company has widely diversified interests, with more than 30 global brands that it has acquired and grown throughout the years, achieving a powerful international corporate image, and creating a vehicle for each of these respective brands to emerge with its own identity. We conduct our business through nineteen wholly-owned subsidiaries: Audiovox Atlanta Corp., VOXX Electronics Corporation, VOXX Accessories Corp., VOXX German Holdings GmbH ("Voxx Germany"), Audiovox Canada Limited, Voxx Hong Kong Ltd., Audiovox International Corp., Audiovox Mexico, S. de R.L. de C.V. ("Voxx Mexico"), Code Systems, Inc., Oehlbach Kabel GmbH ("Oehlbach"), Schwaiger GmbH ("Schwaiger"), Invision Automotive Systems, Inc. ("Invision"), Premium Audio Company LLC ("PAC," which includes Klipsch Group, Inc. and 11 Trading Company LLC), Omega Research and Development, LLC ("Omega"), Voxx Automotive Corp., Audiovox Websales LLC, VSM-Rostra LLC (“VSM”), VOXX DEI LLC, and VOXX DEI Canada LLC (collectively, with VOXX DEI LLC, “DEI”), as well as majority-owned subsidiaries, EyeLock LLC ("EyeLock") and Onkyo Technology KK (“Onkyo”). We market our products under the Audiovox® brand name, other brand names and licensed brands, such as 808®, Acoustic Research®, Advent®, Avital®, Car Link®, Chapman®, Clifford®, Code-Alarm®, Crimestopper , Discwasher®, Energy®, Heco®, Invision®, Integra®, Jamo®, Klipsch®, Mac Audio , Magnat®, myris®, Oehlbach®, Omega®, Onkyo®, Pioneer®, Prestige®, Project Nursery®, Python®, RCA®, RCA Accessories®, Rosen®, Rostra®, Schwaiger®, Smart Start®, Terk®, Vehicle Safety Automotive, Viper®, and Voxx Automotive, as well as private labels through a large domestic and international distribution network. We also function as an OEM ("Original Equipment Manufacturer") supplier to several customers, as well as market a number of products under exclusive distribution agreements, such as SiriusXM satellite radio products. The Company's fiscal year ends on the last day of February. b) Principles of Consolidation, Reclassifications and Accounting Principles The consolidated financial statements and accompanying notes include the financial statements of VOXX International Corporation and its wholly and majority-owned subsidiaries and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), as defined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 270, and in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All significant intercompany balances and transactions have been eliminated in consolidation. Certain amounts in the prior years have been reclassified to conform to the current year presentation. Non-controlling interests represent the equity interests in our consolidated entities that we do not wholly own. Our financial statements reflect 100 % of the revenues, expenses, assets, and liabilities (after elimination of intercompany transactions), although we do not own 100 % of the equity interests of these consolidated entities. The Company follows FASB ASC 810-10-45-21 to report a non-controlling interest (other than non-controlling interests subject to a put option) in the consolidated balance sheets within the equity section, separately from the Company’s retained earnings. Non-controlling interest represents the non-controlling interest holders’ proportionate shares of the equity of the Company’s majority-owned subsidiary, EyeLock. Non-controlling interest is adjusted for the non-controlling interest holders’ proportionate shares of the earnings or losses and other comprehensive (loss) income, if any, and the non-controlling interest continues to be attributed their share of losses even if that attribution results in a deficit non-controlling interest balance. We classify securities with redemption features that are not solely within our control, such as our non-controlling interest that is subject to a put option, outside of permanent equity, specifically the non-controlling shareholder interest in Onkyo. This redeemable non-controlling interest, subject to put option, is recorded at the greater of the non-controlling interest balance determined pursuant to ASC 810-10, “Consolidation,” or the redemption value (which is based upon the greater of a specified formula). Changes in the non-controlling interest due to changes in the redemption amount are immediately recorded as equity transactions and our earnings per share calculation would be adjusted accordingly to treat any redemption adjustment similar to a dividend. Equity investments in which the Company exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. The Company's share of its equity method investee's earnings or losses is included in Other (expense) income in the accompanying Consolidated Statements of Operations and Comprehensive (Loss) Income . The Company eliminates its pro rata share of gross profit on sales to its equity method investee for inventory on hand at the investee at the end of the year. Investments in which the Company does not exercise significant influence over the investee, and which do not have readily determinable fair values, are accounted for under the cost method. c) Use of Estimates The preparation of these consolidated financial statements requires the Company to make estimates and assumptions that affect reported amounts of assets, liabilities, revenue, and expenses. Such estimates include revenue recognition; accrued sales incentives; the allowance for doubtful accounts; inventory valuation; valuation of long-lived assets; valuation and impairment assessment of goodwill, trademarks, and other intangible assets; warranty reserves; stock-based compensation; recoverability of deferred tax assets; and the reserve for uncertain tax positions at the date of the consolidated financial statements. Actual results could differ from those estimates. d) Cash and Cash Equivalents Cash and cash equivalents consist of demand deposits with banks and highly liquid money market funds with original maturities of three months or less when purchased. Cash and cash equivalents amounted to $ 6,134 and $ 27,788 at February 28, 2023, and February 28, 2022, respectively. The Company places its cash and cash equivalents in institutions and funds of high credit quality. As many of our balances are in excess of government insurance, we perform periodic evaluations of these institutions and funds. Cash amounts held in foreign bank accounts amounted to $ 129 and $ 762 at February 28, 2023, and February 28, 2022 , respectively, none of which would be subject to United States federal income taxes if made available for use in the United States. The Tax Cuts and Jobs Act provides a 100 % participation exemption on dividends received from foreign corporations after January 1, 2018, as the United States has moved away from a worldwide tax system and closer to a territorial system for earnings of foreign corporations. e) Fair Value Measurements and Derivatives The Company applies the authoritative guidance on "Fair Value Measurements," which among other things, requires enhanced disclosures about investments that are measured and reported at fair value. This guidance establishes a hierarchal disclosure framework that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices, or for which fair value can be measured from actively quoted prices, generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Investments measured and reported at fair value are classified and disclosed in one of the following categories: Level 1 - Quoted market prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable. Level 3 - Unobservable inputs developed using the Company's estimates and assumptions, which reflect those that market participants would use. The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2023: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 6,134 $ 6,134 $ — $ — Mutual funds 1,053 1,053 - - Derivatives designated for hedging 207 - 207 - Liabilities: Contingent consideration $ 4,500 $ — $ — $ 4,500 The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2022: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 27,788 $ 27,788 $ — $ — Mutual funds 1,231 1,231 - - Liabilities: Derivatives designated for hedging $ 188 $ — $ 188 $ — Contingent consideration 6,435 - - 6,435 The carrying value of the Company's accounts receivable, short-term debt, accounts payable, accrued expenses, bank obligations and long-term debt approximates fair value because of either (i) the short-term nature of the financial instrument; (ii) the interest rate on the financial instrument being reset every quarter to reflect current market rates, or (iii) the stated or implicit interest rate approximates the current market rates or are not materially different than market rates. Contingent consideration is related to the Company’s Onkyo acquisition (see Note 2). The estimated fair value of the contingent consideration is classified within Level 3 and was determined using an income approach. Under this method, potential future purchases applicable to the contingent consideration were determined using internal estimates for growth. The potential future purchases applicable to the contingent consideration were multiplied by the appropriate percentage of payments due to OHEC, and the resulting contingent consideration amounts were adjusted for risk at the appropriate discount rate. The value of the contingent consideration was further discounted to reflect the credit risk of the Company. On May 13, 2022 , OHEC filed for bankruptcy protection in Japan. On February 10, 2023, the contingent consideration obligation was settled with the bankruptcy trustee of OHEC for $ 6,000 , for a gain of $ 443 (see Note 2). This settlement relieves Onkyo from the future payments of 2 % of the total purchase price of certain future product purchases that were to be made in perpetuity. The $ 6,000 settlement amount is to be paid in three installments. The first installment of $ 1,500 was made in February 2023. The remaining installments totaling $ 4,500 , as of February 28, 2023, are expected to be made in Fiscal 2024 after the completion of the obligation of the bankruptcy trustee of OHEC under the settlement agreement. The following table provides a rollforward of the Company's contingent consideration balance for the year ended February 28, 2023: Balance at February 28, 2022 $ 6,435 Payments ( 1,620 ) Fair value adjustment 50 Purchase price allocation adjustment 1,051 Gain on settlement ( 443 ) Foreign currency translation ( 973 ) Balance at February 28, 2023 $ 4,500 Non-financial Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain long-lived non-financial assets and liabilities may be required to be measured at fair value on a nonrecurring basis in certain circumstances, including when there is evidence of impairment. These non-financial assets and liabilities may include assets acquired in a business combination or property and equipment that are determined to be impaired. As of February 28, 2022, and February 28, 2021, certain non-financial assets were measured at fair value subsequent to their initial recognition. See Note 1(k) for the discussion of the impairment of certain intangible assets. Derivative Instruments The Company's derivative instrument consists of an interest rate swap agreement at February 28, 2023. Forward foreign currency contracts are also utilized by the Company from time to time to hedge a portion of its foreign currency inventory purchases. The forward foreign currency derivatives qualifying for hedge accounting are designated as cash flow hedges and valued using observable forward rates for the same or similar instruments (Level 2). Open foreign currency contracts are classified in the balance sheet according to their terms. There are currently no open forward foreign currency contracts at February 28, 2023 . The Company’s interest rate swap agreement hedges interest rate exposure related to the forecasted outstanding balance of its Florida Mortgage with monthly payments due through March 2026. The swap agreement locks the interest rate on the debt at 3.48 % (inclusive of credit spread) through the maturity date of the mortgage. Interest rate swap agreements qualifying for hedge accounting are designated as cash flow hedges and valued based on a comparison of the change in fair value of the actual swap contracts designated as the hedging instruments and the change in fair value of a hypothetical swap contract (Level 2). We calculate the fair value of our interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. The interest rate swap is classified in the balance sheet as either an asset or a liability based on the fair value of the instrument at the end of the period. Financial Statement Classification The Company holds derivative instruments that are designated as hedging instruments. The following table discloses the fair value as of February 28, 2023 and February 28, 2022 for derivative instruments: Derivative Assets and Liabilities Fair Value Account February 28, 2023 February 28, 2022 Designated derivative instruments Interest rate swap Other assets $ 207 $ - Other long-term liabilities - ( 188 ) Total derivatives $ 207 $ ( 188 ) Cash flow hedges It is the Company's policy to enter into derivative instrument contracts with terms that coincide with the underlying exposure being hedged. As such, the Company's derivative instruments are expected to be highly effective. For derivative instruments that are designated and qualify as a cash flow hedge, the entire change in fair value of the hedging instrument included in the assessment of the hedge ineffectiveness is recorded to other comprehensive income (“OCI”). When the amounts recorded in OCI are reclassified to earnings, they are presented in the same income statement line item as the effect of the hedged item. During Fiscal 2023 and Fiscal 2022, the Company did not enter into any new forward foreign currency contracts. All forward foreign currency contracts entered into during Fiscal 2021 were settled as of February 28, 2022 and were designated as cash flow hedges. The current outstanding notional value of the Company's interest rate swap at February 28, 2023 is $ 6,115 . For cash flow hedges, the effective portion of the gain or loss is reported as a component of Other comprehensive (loss) income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. No amounts were excluded from the assessment of hedge effectiveness during the respective periods. During the years ended February 28, 2023 and February 28, 2022 , no contracts originally designated for hedge accounting were de-designated. The gain or loss on the Company’s interest rate swap is recorded in Other comprehensive (loss) income and subsequently reclassified into Interest and bank charges in the period in which the hedged transaction affects earnings. As of February 28, 2023 , no contracts originally designated for hedge accounting were terminated. Activity related to cash flow hedges recorded during the twelve months ended February 28, 2023 and February 28, 2022 was as follows: February 28, 2023 February 28, 2022 Gain Loss Gain Loss Cash flow hedges Foreign currency contracts $ - $ 63 $ 233 $ ( 307 ) Interest rate swaps $ 395 $ — $ 258 $ — f) Investment Securities As of February 28, 2023 and February 28, 2022, the Company had the following investments: February 28, 2023 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,053 Total Marketable Equity Securities 1,053 Total Investment Securities $ 1,053 February 28, 2022 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,231 Total Marketable Equity Securities 1,231 Total Investment Securities $ 1,231 Long-Term Investments Equity Securities Marketable equity securities are measured and recorded at fair value with changes in fair value recorded in the Consolidated Statements of Operations and Comprehensive (Loss) Income. Mutual Funds The Company’s mutual funds are held in connection with its deferred compensation plan. Changes in the carrying value of these securities are offset by changes in the corresponding deferred compensation liability. Changes in fair value of equity securities are recorded within the Consolidated Statements of Operations and Comprehensive (Loss) Income. Investments Held at Cost, Less Impairment During Fiscal 2018, RxNetworks, a Canadian company in which Voxx held a cost method investment consisting of shares of the investee's preferred stock, was sold to a third party. The cash proceeds received by Voxx was subject to a hold-back provision, which was not included in the calculation of the gain recorded on the sale of this investment in Fiscal 2018. In Fiscal 2020, the Company received a portion of the proceeds that were held back in the Fiscal 2018 transaction to sell the RxNetworks investment, as the hold-back provision expired, and certain cash proceeds were released to Voxx. These cash proceeds were recorded as an investment gain in Fiscal 2020. During the third quarter of Fiscal 2021, a final disbursement of all remaining proceeds related to the sale of the RxNetworks investment was received in the amount of $ 42 , which was recorded as an investment gain for the year ended February 28, 2021. g) Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers. Revenue from Contracts with Customers The core principle of ASC Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. We apply the FASB’s guidance on revenue recognition, which requires us to recognize the amount of revenue and consideration that we expect to receive in exchange for goods and services transferred to our customers. To do this, the Company applies the five-step model prescribed by the FASB, which requires us to: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, we satisfy a performance obligation. We account for a contract or purchase order when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the product passes to the customer, which is upon shipment, unless otherwise specified within the customer contract or on the purchase order as delivery and is recognized at the amount that reflects the consideration the Company expects to receive for the products sold, including various forms of discounts. When revenue is recorded, estimates of returns are made and recorded as a reduction of revenue. Contracts with customers are evaluated to determine if there are separate performance obligations related to timing of product shipment that will be satisfied in different accounting periods. When that is the case, revenue is deferred until each performance obligation is met. Within our Automotive Electronics segment, while the majority of the contracts we enter into with Original Equipment Manufacturers (“OEM”) are long-term supply arrangements, the performance obligations are established by the enforceable contract, which is generally considered to be the purchase order. The purchase orders are of durations less than one year. As such, the Company applies the practical expedient in ASC 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less, for which work has not yet been performed. The Company has also elected the practical expedient in ASC 340-40-25-4, whereby the Company recognizes incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets the Company otherwise would have recognized is one year or less. Certain taxes assessed by governmental authorities on revenue producing transactions, such as value added taxes, are excluded from revenue, and recorded on a net basis. Performance Obligations The Company’s primary source of revenue is derived from the manufacture and distribution of automotive electronic, consumer electronic, and biometric products. Our consumer electronic products primarily consist of finished goods sold to retail and commercial customers, consisting of premium audio and other consumer electronic products. Our automotive products, some of which are manufactured by the Company, are sold both to OEM and aftermarket customers. Our biometric products, primarily consisting of finished goods, are sold to retail and commercial customers. We recognize revenue for sales to our customers when transfer of control of the related good or service has occurred. The majority of our revenue was recognized under the point in time approach for the years ended February 28, 2023, February 28, 2022, and February 28, 2021. Certain telematic subscription revenues generated by our Automotive Electronics segment are recognized over time. Contract terms with certain of our OEM customers could result in products and services being transferred over time as a result of the customized nature of some of our products, together with contractual provisions in the customer contracts that provide us with an enforceable right to payment for performance completed to date; however, under typical terms, we do not have the right to consideration until the time of shipment from our manufacturing facilities or distribution centers, or until the time of delivery to our customers. If certain contracts in the future provide the Company with this enforceable right of payment, the timing of revenue recognition from products transferred to customers over time may be slightly accelerated compared to our right to consideration at the time of shipment or delivery. Our typical payment terms vary based on the customer and the type of goods and services in the contract or purchase order. The period of time between invoicing and when payment is due is not significant. Amounts billed and due from our customers are classified as receivables on the Consolidated Balance Sheet. As our standard payment terms are less than one year, we have elected the practical expedient under ASC paragraph 606-10-32-18 to not assess whether a contract has a significant financing component. Our customers take delivery of goods, and they are recognized as revenue at the time of transfer of control to the customer, which is usually at the time of shipment, unless otherwise specified in the customer contract or purchase order. This determination is based on applicable shipping terms, as well as the consideration of other indicators, including timing of when the Company has a present right to payment, when physical possession of products is transferred to customers, when the customer has the significant risks and rewards of ownership of the asset, and any provisions in contracts regarding customer acceptance. While unit prices are generally fixed, we provide variable consideration for certain of our customers, typically in the form of promotional incentives at the time of sale. Depending on the different facts and circumstances, we utilize either the most likely amount or the expected value methods to estimate the effect of uncertainty on the amount of variable consideration to which we would be entitled. The most likely amount method considers the single most likely amount from a range of possible consideration amounts, while the expected value method is the sum of the probability-weighted amounts in a range of possible consideration amounts. Both methods are based upon the contractual terms of the incentives and historical experience with each customer. We record estimates for cash discounts, promotional rebates, and other promotional allowances in the period the related revenue is recognized (“Customer Credits”). The provision for Customer Credits is recorded as a reduction from gross sales and reserves for Customer Credits are presented within Accrued sales incentives on the Consolidated Balance Sheet. Actual Customer Credits have not differed materially from estimated amounts for each period presented. Amounts billed to customers for shipping and handling are included in net sales and costs associated with shipping and handling are included in cost of sales. We have concluded that our estimates of variable consideration are not constrained according to the definition within the standard. Additionally, the Company applies the practical expedient in ASC paragraph 606-10-25-18B and accounts for shipping and handling activities that occur after the customer has obtained control of a good as a fulfillment activity, rather than a separate performance obligation. Under ASC Topic 606, we present a refund liability and a return asset within the Consolidated Balance Sheet. The changes in the refund liability are reported in net sales, and the changes in the return asset are reported in cost of sales in the Consolidated Statements of Operations and Comprehensive (Loss) Income. See Note 14 for return asset and refund liability balances as of February 28, 2023 and February 28, 2022. We warrant our products against certain defects in material and workmanship, when used as designed, for periods of time which primarily range from 30 days to 3 years. We offer limited lifetime warranties on certain products, which limit the customer’s remedy to the repair or replacement of the defective product or part for the original owner for the designated lifetime of the product, or for the life of the vehicle, if it is an automotive product. We do not sell extended warranties. Contract Balances Contract assets primarily relate to the Company’s rights to consideration for work completed but not billed at the reporting date on contracts with customers. Contract assets are transferred to receivables when the rights become unconditional. Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been met, and therefore, revenue has not been recognized. See Note 14 for contract asset and liability balances as of February 28, 2023 and February 28, 2022 . h) Accounts Receivable The majority of the Company's accounts receivable are due from companies in the retail, mass merchant and OEM industries. Credit is extended based on an evaluation of a customer's financial condition. Accounts receivable are generally due within 30 days to 60 days and are stated at amounts due from customers, net of an allowance for credit losses. Accounts outstanding longer than the contracted payment terms are considered past due. Accounts receivable are comprised of the following: February 28, February 28, Trade accounts receivable $ 85,268 $ 108,915 Less: Allowance for credit losses 1,398 2,182 Allowance for cash discounts 1,117 1,108 $ 82,753 $ 105,625 The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customers' current credit worthiness, as determined by a review of their current credit information. The Company continuously monitors collections and payments from its customers and maintains a provision for estimated credit losses based upon historical experience and any specific customer collection issues that have been identified. While such credit losses have historically been within management's expectations and the provisions established, the Company cannot guarantee it will continue to experience the same credit loss rates that have been experienced in the past. The Company writes off accounts receivable balances when collection efforts have been exhausted and deemed uncollectible. Our five largest customer balances comprise 20 % of our accounts receivable balance as of February 28, 2023. A significant change in the liquidity or financial position of any one of these customers could have a material adverse impact on the collectability of accounts receivable and our results of operations. On March 1, 2020 , we adopted Accounting Standards Update (“ASU”) 2016-13 , “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which did not have a material impact on our financial statements. Our financial instruments consist of trade receivables arising from revenue transactions in the ordinary course of business. We extend credit to customers based on pre-defined criteria and trade receivables are generally due within 30 to 60 days . The Company has three supply chain financing agreements and factoring agreements with certain financial institutions to accelerate receivable collection and better manage cash flow. Under the agreements, the Company has agreed to sell these institutions certain of its accounts receivable balances from time to time. For those accounts receivables tendered to the banks that the banks choose to purchase, the banks have agreed to advance an amount equal to the net accounts receivable balances due, less a discount or fee as set forth in the respective agreements. The balances under these agreements are sold without recourse and are accounted for as sales of accounts receivable. Cash proceeds from these agreements are reflected as operating activities included in the change in accounts receivable in the Company's Consolidated Statements of Cash Flows. Total balances sold under the agreements, net of discounts, for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 were approximately $ 98,300 , $ 89,400 , and $ 100,800 , respectively. Fees incurred in connection with these agreements totaled approximately $ 730 , $ 260 , and $ 330 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively, and are recorded within Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income . The Company has the option to suspend and resume its activity under the existing arrangements at any time. i) Inventory The Company values its inventory at the lower of cost or net realizable value ("NRV"). NRV is defined as estimated selling prices less costs of completion, disposal, and transportation. The cost of inventory is determined primarily on an average basis with a portion valued at standard cost, which approximates actual costs on the first-in, first-out basis. The Company regularly reviews inventory quantities on-hand and records a provision for excess and obsolete inventory based primarily on selling prices, indications from customers based upon current price negotiations, and purchase orders. The Company's industry is characterized by rapid technological change and frequent new product introductions that could result in an increase in the amount of obsolete inventory quantities on-hand. In addition, and as necessary, specific reserves for future known or anticipated events may be established. The Company recorded inventory write-downs of $ 2,811 , $ 2,912 , and $ 2,032 for the years ended February 28, 2023, February 28, 2022, and February 28 |
Acquisitions
Acquisitions | 12 Months Ended |
Feb. 28, 2023 | |
Acquisitions And Dispositions [Abstract] | |
Acquisitions | 2) Acquisitions Onkyo On April 29, 2021, the Company’s subsidiary, PAC signed a Letter of Intent to acquire certain assets of the home audio/video business of Onkyo Home Entertainment Corporation (“OHEC”), along with Sharp Corporation (“Sharp”) as PAC’s partner. On May 26, 2021, PAC and Sharp signed an asset purchase agreement (“APA”) to jointly acquire the home audio/video business of OHEC through a joint venture entity. The APA was approved by OHEC’s shareholders at its ordinary general meeting of shareholders on June 25, 2021 and on June 28, 2021, the Company announced that PAC had entered into a joint venture with Sharp in order to execute the transaction. PAC owns 77.2 % of the joint venture and has 85.1 % voting interest and Sharp owns 22.8 % of the joint venture and has 14.9 % voting interest. On September 8, 2021, the newly formed joint venture, Onkyo Technology KK (“Onkyo”), completed the transaction to acquire certain assets of the home audio/video business of OHEC. The acquired assets consisted of intangible assets. The joint venture agreement between PAC and Sharp also contains a put/call arrangement, whereby Sharp has the right to put its interest in the joint venture back to Voxx and Voxx has the right to the call Sharp’s ownership interest in the joint venture at any time after the approval of Onkyo’s annual financial statements for the year ending February 28, 2025 at a purchase price based on a formula as defined in the joint venture agreement. The following summarizes the allocation of the purchase price based upon the fair value of the assets acquired at the date of acquisition: September 8, 2021 Measurement Period Adjustments September 8, 2021 (as adjusted) Purchase price: Cash paid $ 21,989 $ - $ 21,989 Assignment of notes and interest receivable 8,417 - 8,417 Fair value of contingent consideration 6,710 1,119 7,829 Total transaction consideration $ 37,116 $ 1,119 $ 38,235 Allocation: Intangible assets $ 26,929 $ ( 7,905 ) $ 19,024 Goodwill 10,187 9,024 19,211 Total assets acquired $ 37,116 $ 1,119 38,235 During Fiscal 2022 and during the third quarter of Fiscal 2023, the Company recorded a cumulative net measurement period adjustment that increased goodwill by $ 9,024 . The measurement period adjustment would have resulted in a decrease in amortization expense related to tradenames and technology in the third quarter of Fiscal 2022 and was not significant. The Company made the measurement period adjustment to reflect facts and circumstances that existed as of the acquisition date and did not result from intervening events subsequent to such date. The assets acquired include tradenames, technology, and goodwill. The amounts assigned to goodwill and intangible assets for the acquisition are as follows: September 8, 2021 (as adjusted) Amortization Period (Years) Goodwill $ 19,211 N/A Tradenames 12,468 10 Technology 6,556 5 $ 38,235 The fair values of the intangible assets and contingent consideration were determined with the assistance of a third-party valuation expert. The purchase price allocation above is preliminary. Goodwill was determined as the excess of the purchase price over the fair value of the assets acquired, including identifiable intangible assets, all of which is deductible for tax purposes. Goodwill represents workforce and expected cash flow generation for the Onkyo business that does not qualify for separate recognition as intangible assets. The original terms of the contingent consideration payable to OHEC was based upon the calculation of 2 % of the total price of certain future product purchases, as defined in the APA, by PAC. Such payments were due to OHEC in perpetuity. The fair value of the contingent consideration was determined using an income approach, by estimating potential payments based on projections of future inventory purchases multiplied by the 2 % payment and discounting them back to their present values using a weighted average cost of capital. A second discount rate was applied to account for the Company’s credit risk to arrive at the present value of the payments. As there was no set term and the payments were intended to be made in perpetuity, a one-stage Gordon Growth Model was used to account for expected payments made beyond the last year of projections. On May 13, 2022 , OHEC filed for bankruptcy protection in Japan. The filing did not include the assets previously purchased by Onkyo on September 8, 2021. On February 10, 2023, the contingent consideration obligation was settled with the bankruptcy trustee of OHEC for $ 6,000 , for a gain of $ 443 . This settlement relieves Onkyo from the future payments of 2 % of the total purchase price of certain future product purchases that were to be made in perpetuity. The $ 6,000 settlement amount is to be paid in three installments of $ 1,500 , $ 2,500 , and $ 2,000 . The first installment of $ 1,500 was made in February 2023. The remaining installments totaling $ 4,500 , as of February 28, 2023, is expected to be made in Fiscal 2024 after the completion of the obligation of the bankruptcy trustee of OHEC under the settlement agreement. The Company has consolidated the financial results of Onkyo since the acquisition date for financial reporting purposes. The non-controlling interest has been classified as redeemable non-controlling interest outside of equity on the accompanying Consolidated Balance Sheets as the exercise of the put option is not within the Company’s control. The carrying value of the redeemable non-controlling interest of Onkyo cannot be less than the redemption amount, which is the amount the put option would be settled for if exercised. Adjustments to reconcile the carrying value to the redemption amount are recorded immediately to retained earnings. No adjustment was made to the carrying amount of the redeemable non-controlling interest at February 28, 2023 as the excess of the redemption amount over the carrying amount was minimal. The following table provides the rollforward of the redeemable non-controlling interest for the year ended February 28, 2023: Redeemable Non-controlling Interest Balance at February 28, 2022 $ 511 Net loss attributable to non-controlling interest ( 66 ) Comprehensive loss attributable to non-controlling interest ( 125 ) Foreign currency translation ( 88 ) Balance at February 28, 2023 $ 232 The purpose of this acquisition was to expand the Company’s market share and product offerings within the premium audio industry. The joint venture owns the Onkyo and Integra brands and has the licensing rights to the Pioneer brands. The Company will market and sell a variety of products under the Onkyo, Integra, and Pioneer brands through the Company's subsidiary, 11 Trading Company. Onkyo’s results of operations are included in the consolidated financial statements of Voxx in our Consumer Electronics segment from September 8, 2021. Onkyo's sales eliminate in consolidation and totaled $ 11,027 and $ 5,190 of the Company's net sales before consolidation for the years ended February 28, 2023 and February 28, 2022, respectively. Prior to the acquisition, PAC operated under a distribution agreement with OHEC through its 11 TC subsidiary, selling Onkyo and Pioneer products to Voxx customers. No additional customer contracts were acquired in conjunction with the acquisition and 11TC continues to sell these products to the same pre-acquisition customer base. Historical financial statements for Onkyo prior to the acquisition were not available and it is impracticable for the Company to determine the impact the acquisition would have had on the Company’s revenue or net (loss) income had it been included in the consolidated results of the Company for the full year ended February 28, 2022, or the year ended February 28, 2021. Directed LLC and Directed Electronics Canada, Inc. On July 1, 2020, the Company completed the acquisition of certain assets and liabilities, which comprise the aftermarket vehicle remote start and security systems and connected car solutions (telematics) businesses of Directed LLC and Directed Electronics Canada Inc. (collectively, with Directed LLC, “Directed”) via an asset purchase agreement. The acquired assets included inventory, accounts receivable, certain fixed assets, IT systems, and intellectual property. The cash purchase price was $ 11,000 . Net sales from the Company’s newly formed subsidiaries, VOXX DEI LLC and VOXX DEI Canada, Ltd. (collectively, with VOXX DEI LLC, “DEI”), included in our consolidated results for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 represented approximately 9.1 %, 10.4 %, and 8.4 % of our consolidated net sales, respectively. DEI’s results of operations are included in the consolidated financial statements of Voxx in our Automotive Electronics segment. The purpose of this acquisition was to expand the Company’s market share within the automotive electronics industry. The following summarizes the allocation of the purchase price based upon the fair value of the assets acquired and liabilities assumed at the date of acquisition: July 1, 2020 Measurement July 1, 2020 Assets acquired: Inventory $ 7,054 956 8,010 Accounts receivable 5,173 357 5,530 Other current assets 160 - 160 Property and equipment 2,815 - 2,815 Operating lease, right of use asset 1,771 - 1,771 Customer relationships 2,600 ( 100 ) 2,500 Trademarks 4,500 - 4,500 Patented technology 1,030 - 1,030 Goodwill 3,290 ( 1,690 ) 1,600 Total assets acquired $ 28,393 $ ( 477 ) $ 27,916 Liabilities assumed: Accounts payable 8,144 - 8,144 Accrued expenses 1,406 ( 136 ) 1,270 Contract liabilities 4,872 11 4,883 Warranty accrual 1,200 ( 352 ) 848 Operating lease liability 1,771 - 1,771 Total $ 17,393 $ ( 477 ) $ 16,916 Total purchase price $ 11,000 $ - $ 11,000 During Fiscal 2022 and Fiscal 2021, the Company recorded cumulative net measurement period adjustments that decreased goodwill by $ 1,690 , as presented in the table above. The measurement period adjustment would have resulted in an insignificant decrease in amortization expense related to the customer relationships in the second quarter of Fiscal 2021. The Company made these measurement period adjustments to reflect facts and circumstances that existed as of the acquisition date and did not result from intervening events subsequent to such date. Goodwill was determined as the excess of the purchase price over the fair value of the assets acquired (including the identifiable intangible assets) and represents synergies expected. |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Feb. 28, 2023 | |
Variable Interest Entity [Abstract] | |
Variable Interest Entities | 3) Variable Interest Entities A variable interest entity ("VIE") is an entity that either (i) has insufficient equity to permit the entity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. Under ASC 810 “Consolidation,” an entity that holds a variable interest in a VIE and meets certain requirements would be considered to be the primary beneficiary of the VIE and required to consolidate the VIE in its consolidated financial statements. In order to be considered the primary beneficiary of a VIE, an entity must hold a variable interest in the VIE and have both: • the power to direct the activities that most significantly impact the economic performance of the VIE; and • the right to receive benefits from, or the obligation to absorb losses of, the VIE that could be potentially significant to the VIE. Effective September 1, 2015, Voxx acquired a majority voting interest in substantially all of the assets and certain specified liabilities of EyeLock, Inc. and EyeLock Corporation, a market leader of iris-based identity authentication solutions, through a newly formed entity, EyeLock LLC. The Company has issued EyeLock LLC a promissory note for the purposes of repaying protective advances and funding working capital requirements of the company. On August 25, 2022, this promissory note was amended and restated to allow EyeLock LLC to borrow up to maximum of $ 71,200 . Through March 1, 2019, interest on the outstanding principal of the loan accrued at 10 %. From March 1, 2019 forward, interest accrues at 2.5 %. The amended and restated promissory note is due on September 30, 2023. The outstanding principal balance of this promissory note is convertible at the sole option of Voxx into units of EyeLock LLC. If Voxx chooses not to convert into equity, the outstanding loan principal of the amended and restated promissory note will be repaid at a multiple of 1.50 based on the repayment date. The agreement includes customary events of default and is collateralized by all of the property of EyeLock LLC. We have determined that we hold a variable interest in EyeLock LLC as a result of: • our majority voting interest and ownership of substantially all of the assets and certain liabilities of the entity; and • the loan agreement with EyeLock LLC, which has a total outstanding principal balance of $ 66,175 as of February 28, 2023. We concluded that we became the primary beneficiary of EyeLock LLC on September 1, 2015 in conjunction with the acquisition. This was the first date that we had the power to direct the activities of EyeLock LLC that most significantly impact the economic performance of the entity because we acquired a majority interest in substantially all of the assets and certain liabilities of EyeLock Inc. and EyeLock Corporation on this date, as well as obtained a majority voting interest as a result of this transaction. Although we are considered to have control over EyeLock LLC under ASC 810, as a result of our majority ownership interest, the assets of EyeLock LLC can only be used to satisfy the obligations of EyeLock LLC. As a result of our majority ownership interest in the entity and our primary beneficiary conclusion, we consolidated EyeLock LLC in our consolidated financial statements beginning on September 1, 2015. On April 29, 2021, EyeLock LLC entered into a three-year exclusive distribution agreement (the “Agreement”) with GalvanEyes LLC (“GalvanEyes”), a Florida LLC managed by Beat Kahli, the largest holder of Voxx’s Class A Common Shares. The Agreement provides that GalvanEyes will become the exclusive distributor of EyeLock products in the European Union, Switzerland, Puerto Rico, Malaysia, and Singapore, with the exception of any existing customer relationships. GalvanEyes was also granted exclusive distribution rights in the United States for the residential real estate market and specific U.S. Government agencies, and non-exclusive distribution rights in all other territories and verticals with the Company’s consent. The Agreement also includes a put/call arrangement, whereby GalvanEyes has the right to put the exclusivity back to EyeLock after the initial two-year period for a 20.0 % interest in EyeLock. In turn, EyeLock has the ability to call the exclusivity during the term of the Agreement, based on the occurrence of certain events, which would result in a 20.0 % equity interest given to GalvanEyes. Under the Agreement, in addition to paying for any products purchased, GalvanEyes has agreed to pay EyeLock $ 10,000 in the form of an annual fee, over a two-year period, of up to $ 5,000 per year, with payments on a quarterly basis beginning on September 1, 2021. Any gross profit generated on the sale of EyeLock LLC products by GalvanEyes will be deducted from the annual fee. The value of the put/call arrangement was not significant at February 28, 2023. On February 28, 2023, the Company received a payment in the amount of $ 1,249 for the quarterly installment payment due from GalvanEyes for the three months ended February 28, 2023. The Company has also recorded a corresponding liability within Other long-term liabilities on the accompanying Consolidated Balance Sheets, representing a prepayment made by GalvanEyes of a 20 % interest in EyeLock upon exercise of the put option. The balance of this liability at February 28, 2023 and February 28, 2022 was $ 7,317 and $ 2,451 , respectively, which includes the balance receivable at February 28, 2023, as well as previous payments received since September 1, 2021. Assets and Liabilities of EyeLock LLC The following table sets forth the carrying values of assets and liabilities of EyeLock LLC that were included on our Consolidated Balance Sheets as of February 28, 2023 and February 28, 2022: February 28, 2023 February 28, 2022 Assets Current assets: Cash and cash equivalents $ 158 $ 25 Accounts receivable, net 520 47 Inventory, net 1,836 2,028 Prepaid expenses and other current assets 93 245 Total current assets 2,607 2,345 Property, plant and equipment, net 9 39 Intangible assets, net 1,786 2,057 Other assets 8 59 Total assets $ 4,410 $ 4,500 Liabilities and Partners' Deficit Current liabilities: Accounts payable $ 864 $ 1,023 Interest payable to VOXX 14,803 13,099 Accrued expenses and other current liabilities 296 766 Due to VOXX 66,175 66,390 Total current liabilities 82,138 81,278 Prepaid ownership interest due to GalvanEyes LLC 7,317 2,451 Other long-term liabilities 1,200 1,200 Total liabilities 90,655 84,929 Commitments and contingencies Partners' deficit: Capital 41,416 41,416 Retained losses ( 127,661 ) ( 121,845 ) Total partners' deficit ( 86,245 ) ( 80,429 ) Total liabilities and partners' deficit $ 4,410 $ 4,500 The assets of EyeLock LLC can only be used to satisfy the obligations of EyeLock LLC. Revenue and Expenses of EyeLock LLC The following table sets forth the revenue and expenses of EyeLock LLC that were included in our Consolidated Statements of Operations and Comprehensive (Loss) Income for the years ended February 28, 2023, February 28, 2022, and February 28, 2021: Year Ended Year Ended Year Ended February 28, 2023 February 28, 2022 February 28, 2021 Net sales $ 1,046 $ 882 $ 836 Cost of sales 688 694 1,025 Gross profit 358 188 ( 189 ) Operating expenses: Selling 575 653 603 General and administrative 1,509 1,410 1,785 Engineering and technical support 2,355 5,817 4,674 Total operating expenses 4,439 7,880 7,062 Operating loss ( 4,081 ) ( 7,692 ) ( 7,251 ) Other (expense) income: Interest and bank charges ( 1,720 ) ( 1,662 ) ( 1,475 ) Other, net ( 15 ) — — Total other expense, net ( 1,735 ) ( 1,662 ) ( 1,475 ) Loss before income taxes ( 5,816 ) ( 9,354 ) ( 8,726 ) Income tax expense — — — Net loss $ ( 5,816 ) $ ( 9,354 ) $ ( 8,726 ) |
Receivables from Vendors
Receivables from Vendors | 12 Months Ended |
Feb. 28, 2023 | |
Receivables From Vendors [Abstract] | |
Receivables from Vendors | 4) Receivables from Vendors The Company has recorded receivables from vendors in the amount of $ 112 and $ 363 as of February 28, 2023 and February 28, 2022 , respectively. Receivables from vendors primarily represent prepayments on product shipments and product reimbursements. |
Equity Investment
Equity Investment | 12 Months Ended |
Feb. 28, 2023 | |
Equity Method Investment, Summarized Financial Information [Abstract] | |
Equity Investment | 5) Equity Investment The Company has a 50 % non-controlling ownership interest in ASA Electronics, LLC and Subsidiary ("ASA"), which acts as a distributor of mobile electronics specifically designed for niche markets within the Automotive industry, including RV’s; buses; and commercial, heavy duty, agricultural, construction, powersport, and marine vehicles. ASC 810 requires the Company to evaluate non-consolidated entities periodically, and as circumstances change, to determine if an implied controlling interest exists. During Fiscal 2023, the Company evaluated this equity investment and concluded that ASA is not a variable interest entity. ASA’s fiscal year end is November 30, 2022; however, the results of ASA as of and through February 28, 2023 have been recorded in the consolidated financial statements. The following presents summary financial information of ASA. Such summary financial information has been provided herein based upon the individual significance of ASA to the consolidated financial information of the Company. February 28, 2023 February 28, 2022 Current assets $ 48,391 $ 46,202 Non-current assets 6,525 7,382 Liabilities 10,880 10,888 Members' equity 44,036 42,696 Twelve Months Twelve Months Twelve Months February 28, February 28, February 28, Net sales $ 104,997 $ 114,825 $ 95,866 Gross profit 25,671 27,517 24,124 Operating income 13,749 15,695 12,938 Net income 13,938 15,780 14,700 The Company's share of income from ASA for the years ended February 28, 2023, February 28, 2022 and February 28, 2021 was $ 6,969 , $ 7,890 , and $ 7,350 , respectively. In addition, the Company received cash distributions from ASA totaling $ 6,300 , $ 9,809 , and $ 6,009 during the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively. Undistributed earnings from equity investments amounted to $ 16,692 and $ 16,022 at February 28, 2023 and February 28, 2022, respectively. Net sales transactions between the Company and ASA were $ 232 , $ 315 , and $ 260 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively. Accounts receivable balances from ASA were $ 49 and $ 68 as of February 28, 2023 and February 28, 2022 , respectively. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Feb. 28, 2023 | |
Accrued Liabilities, Current [Abstract] | |
Accrued Expenses and Other Current Liabilities | 6) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: February 28, February 28, Commissions $ 623 $ 934 Employee compensation 15,878 17,082 Professional fees and accrued settlements 1,526 1,620 Future warranty 5,845 4,470 Refund liability 5,181 5,469 Freight and duty 7,508 10,342 Royalties, advertising and other 5,295 14,057 Total accrued expenses and other current liabilities $ 41,856 $ 53,974 |
Financing Arrangements
Financing Arrangements | 12 Months Ended |
Feb. 28, 2023 | |
Debt Disclosure [Abstract] | |
Financing Arrangements | 7) Financing Arrangements The Company has the following financing arrangements: February 28, February 28, Domestic credit facility (a) $ 29,000 $ — Florida mortgage (b) 6,115 6,614 Euro asset-based lending obligation - VOXX Germany (c) — 1,906 Shareholder loan payable to Sharp (d) 4,079 4,718 Total debt 39,194 13,238 Less: current portion of long-term debt 500 2,406 Long-term debt before debt issuance costs 38,694 10,832 Less: debt issuance costs 1,181 1,046 Total long-term debt $ 37,513 $ 9,786 a) Domestic Bank Obligations The Company has a senior secured credit facility (the “Credit Facility") with Wells Fargo Bank, N.A. (“Wells Fargo”), which was amended on February 15, 2023. The amended Credit Facility provides for an increase in the revolving credit facility with committed availability of up to $ 165,000 and also includes a $ 50,000 sublimit for letters of credit and a $ 15,000 sublimit for Swing Loans. The availability under the revolving credit line within the Credit Facility is subject to a borrowing base, which is based on eligible accounts receivable, eligible inventory and certain real estate, subject to reserves as determined by the lender, and is also limited by amounts outstanding under the Florida Mortgage (see Note 7(b)). The remaining availability under the revolving credit line of the Credit Facility was $ 84,033 as of February 28, 2023. Any amounts outstanding under the Credit Facility will mature and become immediately due on April 19, 2026 ; however, the Credit Facility is subject to acceleration upon the occurrence of an Event of Default (as defined in the Credit Agreement). The Company may prepay any amounts outstanding at any time. Commitments under the Credit Facility may be irrevocably reduced at any time, without premium or penalty as set forth in the Credit Facility. Pursuant to the amendment to the Credit Facility on February 25, 2023 the LIBOR rate previously in place for the revolving credit facility was replaced by the SOFR rate. As of the effective date of the amendment, any outstanding LIBOR rate loans automatically converted to SOFR Loans. Generally, the Company may designate specific borrowings under the Credit Facility as either Base Rate Loans or SOFR Loans, except that Swing Loans may only be designated as Base Rate Loans. Loans under the Credit Facility designated as SOFR Loans shall bear interest at a rate equal to the then-applicable SOFR Rate plus a range of 1.75 % - 2.25 % ( 6.44 % at February 28, 2023 ). Loans under the Credit Facility designated as Base Rate Loans shall bear interest at a rate equal to the applicable margin for Base Rate Loans of 0.75 % - 1.25 %, as defined in the agreement and shall not be lower than 1.75 % ( 8.50 % at February 28, 2023). Provided the Company is in a Compliance Period (the period commencing on the day in which Excess Availability is less than 15 % of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than 15% for any consecutive 30-day period thereafter) , the Credit Facility requires compliance with a financial covenant calculated as of the last day of each month consisting of a Fixed Charge Coverage Ratio. The Credit Facility also contains covenants, subject to defined carveouts, that limit the ability of the loan parties and certain of their subsidiaries which are not loan parties to, among other things: (i) incur additional indebtedness; (ii) incur liens; (iii) merge, consolidate or dispose of a substantial portion of their business; (iv) transfer or dispose of assets; (v) change their name, organizational identification number, state or province of organization or organizational identity; (vi) make any material change in their nature of business; (vii) prepay or otherwise acquire indebtedness; (viii) cause any change of control; (ix) make any restricted junior payment; (x) change their fiscal year or method of accounting; (xi) make advances, loans or investments; (xii) enter into or permit any transaction with an affiliate of any borrower or any of their subsidiaries; (xiii) use proceeds for certain items; (xiv) issue or sell any of their stock; (xv) consign or sell any of their inventory on certain terms. In addition, if excess availability under the Credit Facility were to fall below certain specified levels, as defined in the Credit Facility, the lenders would have the right to assume dominion and control over the Company's cash. As of February 28, 2023, the Company was not in a Compliance Period. The obligations under the Credit Facility are secured by a general lien on, and security interest in, substantially all of the assets of the borrowers and certain of the guarantors, including accounts receivable, equipment, real estate, general intangibles, and inventory. The Company has guaranteed the obligations of the borrowers under the Credit Facility. The Company has deferred financing costs related to the Credit Facility and previous amendments and modifications of the Credit Facility. In conjunction with the amendment to its Credit Facility on February 15, 2023, the Company incurred additional financing fees of $ 398 that will be amortized over the remaining term of the facility. The Company accounted for the February 2023 amendment to the Credit Facility as a modification of debt. Deferred financing costs are included in Long-term debt on the accompanying Consolidated Balance Sheets as a contra-liability balance and are amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the remaining term of the Credit Facility. The Company amortized $ 231 during the year ended February 28, 2023 and $ 241 during both of the years ended February 28, 2022 and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 1,088 . Charges incurred on the unused portion of the Credit Facility and its predecessor revolving credit facility during the years ended February 28, 2023, February 28, 2022, and February 28, 2021 totaled $ 686 , $ 739 , and $ 504 , respectively, and are included within Interest and Bank Charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . b) Florida Mortgage On July 6, 2015, VOXX HQ LLC, the Company’s wholly owned subsidiary, closed on a $ 9,995 industrial development revenue tax exempt bond under a loan agreement in favor of the Orange County Industrial Development Authority (the “Authority”) to finance the construction of the Company's manufacturing facility and executive offices in Lake Nona, Florida (the “Construction Loan”). Wells Fargo Bank, N.A. ("Wells Fargo") was the purchaser of the bond and U.S. Bank National Association is the trustee under an Indenture of Trust with the Authority. Voxx borrowed the proceeds of the bond purchase from the Authority during construction as a revolving loan, which converted to a permanent mortgage upon completion of the facility in January 2016 (the "Florida Mortgage"). The Company makes principal and interest payments to Wells Fargo, which began March 1, 2016 and will continue through March of 2026. The Florida Mortgage bears interest at 70 % of 1-month LIBOR plus 1.54 % ( 6.21 % at February 28, 2023) and is secured by a first mortgage on the property, a collateral assignment of leases and rents and a guaranty by the Company. The Company is in compliance with the financial covenants of the Florida Mortgage, which are as defined in the Company’s Credit Facility with Wells Fargo dated April 26, 2016 and amended in April 2021 and February 2023. The amendment to the Credit Facility in April 2021 provided for a Benchmark Replacement that will replace the LIBOR rate for the Florida Mortgage. The Benchmark Replacement is subject to the occurrence of a Benchmark Transition Event, as defined in the Second Amended and Restated Credit Agreement and becomes effective after a five-day transition period following the event. The amendment to the Credit Facility in February 2023 was not deemed a Benchmark Transition Event for the Florida Mortgage and the interest rate in effect for this loan remains referenced to LIBOR at February 28, 2023. The Company incurred debt financing costs totaling approximately $ 332 as a result of obtaining the Florida Mortgage, which are recorded as deferred financing costs and included in Long-term debt as a contra-liability balance on the accompanying Consolidated Balance Sheets and are being amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the ten-year term of the Florida Mortgage. The Company amortized $ 31 of these costs during each of the years ended February 28, 2023, February 28, 2022, and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 93 . On July 20, 2015, the Company entered into an interest rate swap agreement in order to hedge interest rate exposure related to the Florida Mortgage and pays a fixed rate of 3.48 % under the swap agreement (see Note 1(e)). On May 1, 2023, VOXX HQ LLC, a wholly owned subsidiary of the Company, consented to a First Amendment and Supplement to the Indenture of Trust relating to the Florida Industrial Revenue Bonds which were purchased by Wells Fargo N.A., and which provided for a replacement benchmark from LIBOR to SOFR including a modification to the interest rate to 79 % of the applicable SOFR Rate plus 1.87 %. On May 3, 2023, VOXX HQ LLC entered into an Amended and Restated Confirmation of Swap Transaction with Wells Fargo Bank N.A. related to the interest rate swap that hedges the Company's interest rate exposure on the Florida Industrial Revenue Bonds. The swap contract was amended to reference the SOFR Rate, as well as set a new fixed rate equal to 3.43 % c) Euro Asset-Based Lending Obligation – VOXX Germany Foreign bank obligations include a Euro Asset-Based Lending ("ABL") credit facility, which has a credit limit of € 8,000 , for the Company's subsidiary, VOXX Germany, which expires on July 31, 2023. The rate of interest for the ABL is the three-month Euribor plus 2.30 % ( 5.04 % at February 28, 2023 ). d) Shareholder Loan Payable to Sharp Asset In conjunction with the capitalization and funding of the Company’s Onkyo joint venture with its partner Sharp, which was created in order to execute the acquisition of certain assets of the home audio/video business of OHEC on September 8, 2021 (see Note 2), Onkyo entered into a loan agreement with the shareholders of the joint venture, PAC and Sharp. The loan balance outstanding at February 28, 2023 represents the portion of the loan payable to Sharp. The loan balance due to PAC eliminates in consolidation. All amounts outstanding under the loan will mature and become payable ten years from the execution date of the acquisition, which is September 8, 2031. The loan may be prepaid subject the approval of the board of directors of the joint venture and must be repaid if either the put or call option is exercised in accordance with the joint venture agreement. The rate of interest for the shareholder loan is 2.5 % and the loan is secured by a second priority lien on and secured interest in all assets of Onkyo. The following is a maturity table for debt and bank obligations outstanding at February 28, 2023 for each of the following fiscal years: 2024 $ 500 2025 500 2026 500 2027 33,615 2028 - Thereafter 4,079 Total $ 39,194 The weighted-average interest rate on short-term debt was 3.48 % for Fiscal 2023 and 2.66 % for Fiscal 2022. Interest expense related to the Company's financing arrangements for the years ended February 28, 2023, February 28, 2022 and February 28, 2021 was $ 2,299 , $ 550 , and $ 825 , respectively, of which $ 1,507 and $ 326 was related to the Credit Facility for the years ended February 28, 2023 and February 28, 2021. For the year ended February 28, 2022, none of the Company’s interest expense was related to the Credit Facility, as there was no outstanding balance during Fiscal 2022. |
Income Taxes
Income Taxes | 12 Months Ended |
Feb. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8) Income Taxes The components of income (loss) before the provision (benefit) for income taxes are as follows: Year Year Year February 28, February 28, February 28, Domestic Operations $ ( 33,501 ) $ ( 26,665 ) $ 24,485 Foreign Operations 2,551 826 3,153 $ ( 30,950 ) $ ( 25,839 ) $ 27,638 The provision (benefit) for income taxes is comprised of the following: Year Year Year February 28, February 28, February 28, Current provision (benefit) Federal $ 254 $ 20 $ ( 10 ) State 242 804 1,172 Foreign 1,248 2,148 496 Total current provision $ 1,744 $ 2,972 $ 1,658 Deferred (benefit) provision Federal $ ( 394 ) $ ( 2,300 ) $ 3,362 State ( 271 ) 1,010 ( 84 ) Foreign ( 1,118 ) ( 56 ) ( 664 ) Total deferred (benefit) provision $ ( 1,783 ) $ ( 1,346 ) $ 2,614 Total (benefit) provision Federal $ ( 140 ) $ ( 2,280 ) $ 3,352 State ( 29 ) 1,814 1,088 Foreign 130 2,092 ( 168 ) Total (benefit) provision $ ( 39 ) $ 1,626 $ 4,272 The effective tax rate before income taxes varies from the current statutory U.S. federal income tax rate as follows: Year Year Year February 28, February 28, February 28, Tax benefit at Federal statutory rates $ ( 6,499 ) 21.0 % $ ( 5,426 ) 21.0 % $ 5,804 21.0 % State income taxes, net of Federal benefit ( 711 ) 2.3 ( 282 ) 1.1 983 3.5 Change in valuation allowance 5,785 ( 18.7 ) 7,214 ( 28.0 ) ( 3,365 ) ( 12.2 ) Change in tax reserves ( 173 ) 0.5 ( 227 ) 0.9 ( 311 ) ( 1.1 ) Non-controlling interest 476 ( 1.5 ) 766 ( 3.0 ) 714 2.6 U.S. effects of foreign operations 379 ( 1.2 ) ( 2,135 ) 8.3 521 1.9 Permanent differences and other 794 ( 2.6 ) 581 ( 2.2 ) ( 192 ) ( 0.7 ) Foreign rate differential 402 ( 1.3 ) 787 ( 3.1 ) 412 1.5 Change in tax rate 39 ( 0.1 ) 105 ( 0.4 ) 102 0.4 Research & development credits ( 531 ) 1.7 243 ( 0.9 ) ( 396 ) ( 1.4 ) Effective tax rate $ ( 39 ) 0.1 % $ 1,626 ( 6.3 )% $ 4,272 15.5 % The U.S. effects of foreign operations includes the US global intangible low tax income (“GILTI”) inclusion, net of the IRC Section 250 deduction and foreign derived intangible income (“FDII”) deduction, foreign tax credits, and other foreign adjustments. Permanent differences and other include nondeductible expenses, Section 162(m) limitation on executive compensation, and other adjustments. Deferred income taxes reflect the net tax effects of temporary differences between the carrying values of assets and liabilities for financial reporting and tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: February 28, February 28, Deferred tax assets: Accounts receivable $ 192 $ 301 Inventory 4,196 4,356 Property, plant and equipment 2,467 1,903 IRC Section 174 - Capitalized R&D 3,735 — Interim arbitration award 10,453 9,515 Operating lease 811 999 Accruals and reserves 6,097 5,946 Deferred compensation 268 297 Warranty reserves 1,465 692 Unrealized gains and losses 4,877 4,219 Partnership investments 3,262 3,399 Net operating losses 5,270 6,278 Foreign tax credits 1,739 2,254 Other tax credits 5,344 5,220 Deferred tax assets before valuation allowance 50,176 45,379 Less: valuation allowance ( 35,421 ) ( 30,059 ) Total deferred tax assets 14,755 15,320 Deferred tax liabilities: Intangible assets ( 16,035 ) ( 17,464 ) Prepaid expenses ( 1,513 ) ( 2,079 ) Operating lease ( 798 ) ( 977 ) Deferred financing fees ( 46 ) ( 60 ) Total deferred tax liabilities ( 18,392 ) ( 20,580 ) Net deferred tax liability $ ( 3,637 ) $ ( 5,260 ) In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in those periods in which temporary differences become deductible and/or net operating loss carryforwards can be utilized. We consider the level of historical taxable income, scheduled reversal of temporary differences, tax planning strategies, and projected future taxable income in determining whether a valuation allowance is warranted. Significant weight is given to positive and negative evidence that is objectively verifiable. The Company evaluates the realizability of deferred tax assets on a jurisdictional basis at each reporting date. Accounting for income taxes requires that a valuation allowance be established when it is more likely than not that all or a portion of the deferred tax assets will not be realized. In circumstances where there is sufficient negative evidence indicating that the deferred tax assets are not more likely than not realizable, we establish a valuation allowance. In addition, the Company maintains a valuation allowance against deferred tax assets in certain foreign jurisdictions. The Company's valuation allowance increased by $ 5,362 during the year ended February 28, 2023. Any further increase or reduction in the valuation allowance could have a favorable or unfavorable impact on our income tax provision and net income in the period in which such determination is made. Notwithstanding the U.S. taxation of the deemed repatriated foreign earnings as a result of the one-time transition tax during Fiscal 2018, the Company intends to continue to invest these earnings indefinitely outside the U.S. If these future earnings are repatriated to the U.S., or if the Company determines that such earnings will be remitted in the foreseeable future, the Company may be required to accrue U.S. deferred taxes (if any) and applicable withholding taxes. It is not practicable to estimate the tax impact of the reversal of the outside basis difference, or the repatriation of cash due to the complexity of its hypothetical calculation. As of February 28, 2023 , the Company has capital loss carryforwards of approximately $ 14,056 which expire in 2024 which are only available to offset capital gain income. The Company has foreign tax credits of $ 986 which expire in tax years 2031 through 2032 . The Company has federal research and development tax credits of $ 3,805 which expire in tax years 2036 through 2042 . The Company has various foreign net operating loss carryforwards, state net operating loss carryforwards, and state tax credits that expire in various years and amounts through tax year 2042. A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows: Balance at February 29, 2020 $ 7,235 Additions based on tax positions taken in the current and prior years 3 Settlements — Decreases based on tax positions taken in the prior years ( 490 ) Other 112 Balance at February 28, 2021 $ 6,860 Additions based on tax positions taken in the current and prior years 140 Settlements — Decreases based on tax positions taken in the prior years ( 563 ) Other ( 172 ) Balance at February 28, 2022 $ 6,265 Additions based on tax positions taken in the current and prior years 114 Settlements — Decreases based on tax positions taken in prior years ( 484 ) Other 89 Balance at February 28, 2023 $ 5,984 Of the amounts reflected in the table above at February 28, 2023 , $ 5,984 , if recognized, would reduce our effective tax rate. If recognized, $ 5,212 of the unrecognized tax benefits are likely to attract a full valuation allowance, thereby offsetting the favorable impact to the effective tax rate. Our unrecognized tax benefit non-current consolidated balance sheet liability, including interest and penalties, is $ 966 . The Company records accrued interest and penalties related to income tax matters in the provision for income taxes in the accompanying Consolidated Statements of Operations and Comprehensive (Loss) Income. For the years ended February 28, 2023, February 28, 2022 and February 28, 2021, interest and penalties on unrecognized tax benefits were $( 5 ) , $( 28 ) and $ 4 , respectively. The balance as of February 28, 2023 and February 28, 2022 was $ 194 and $ 198 , respectively. It is reasonably possible that unrecognized tax benefits will decrease by approximately $ 300 within the next 12 months. The Company, or one of its subsidiaries, files its tax returns in the U.S. and certain state and foreign income tax jurisdictions with varying statutes of limitations. The earliest years' tax returns filed by the Company that are still subject to examination by the tax authorities in the major jurisdictions are as follows: Jurisdiction Tax Year U.S. 2018 Netherlands 2017 Germany 2018 |
Capital Structure
Capital Structure | 12 Months Ended |
Feb. 28, 2023 | |
Equity [Abstract] | |
Capital Structure | 9) Capital Structure The Company's capital structure is as follows: Shares Authorized Shares Outstanding Security Par February 28, February 28, February 28, February 28, Voting Liquidation Preferred Stock $ 50.00 50,000 50,000 — — — $ 50 per share Series Preferred Stock $ 0.01 1,500,000 1,500,000 — — — Class A Common Stock $ 0.01 60,000,000 60,000,000 21,167,527 21,614,629 one Ratably with Class B Class B Common Stock $ 0.01 10,000,000 10,000,000 2,260,954 2,260,954 ten Ratably with Class A The holders of Class A and Class B common stock are entitled to receive cash or property dividends declared by the Board of Directors. The Board of Directors can declare cash dividends for Class A common stock in amounts equal to or greater than the cash dividends for Class B common stock. Dividends other than cash must be declared equally for both classes. Each share of Class B common stock may, at any time, be converted into one share of Class A common stock. Stock held in treasury by the Company is accounted for using the cost method, which treats stock held in treasury as a reduction to total stockholders' equity and amounted to 3,370,657 and 2,862,218 shares at February 28, 2023 and February 28, 2022 , respectively. The cost basis for subsequent sales of treasury shares is determined using an average cost method. In Fiscal 2020, the Company was authorized by the Board of Directors to increase the number of Class A Common Stock available for repurchase in the open market to 3,000,000 . During the years ended February 28, 2023 and February 28, 2022, the Company repurchased 508,439 and 113,000 shares of Class A Common Stock, respectively, for an aggregate cost of $ 5,147 and $ 1,220 , respectively. During the year ended February 28, 2021, the Company repurchased no shares. As of February 28, 2023, 1,797,437 shares of the Company's Class A common stock are authorized to be repurchased in the open market. |
Other Stock and Retirement Plan
Other Stock and Retirement Plans | 12 Months Ended |
Feb. 28, 2023 | |
Retirement Benefits [Abstract] | |
Other Stock and Retirement Plans | 10) Other Stock and Retirement Plans a) Supplemental Executive Retirement Plan Subject to certain performance criteria, service requirements and age restrictions, employees who participate in the SERP will receive restricted stock awards pursuant to the 2014 Plan. The restricted stock awards vest on the later of three years from the date of grant, or the grantee reaching the age of 65 years (see Note 1(u)). As of February 28, 2023, approximately 1,049,275 shares of the Company's Class A common stock are reserved for issuance under the Company's Restricted and Stock Option Plans. b) Profit Sharing Plans The Company has established two non-contributory employee profit sharing plans for the benefit of its eligible employees in the United States and Canada. The plans are administered by trustees appointed by the Company. No discretionary contributions were made during the years ended February 28, 2023, February 28, 2022, and February 28, 2021. Contributions required by law to be made for eligible employees in Canada were not material for all periods presented. c) 401(k) Plans The VOXX International Corporation 401(k) plan is for all eligible domestic employees. The Company matches a portion of the participant's contributions after three months of service under a predetermined formula based on the participant's contribution level. Shares of the Company's Common Stock are not an investment option in the 401(k) plan and the Company does not use such shares to match participants' contributions. During the years ended February 28, 2023, February 28, 2022, and February 28, 2021, the Company contributed, net of forfeitures, $ 685 , $ 689 , and $ 555 to the 401(k) Plan. d) Cash Bonus Profit Sharing Plan The Company has a Cash Bonus Profit Sharing Plan that allows it to make profit sharing contributions for the benefit of eligible employees for any fiscal year based on a pre-determined formula on the Company's pre-tax profits. The size of the contribution is dependent upon the performance of the Company. A participant’s share of the contribution is determined pursuant to the participant’s eligible wages for the fiscal year as a percentage of total eligible wages for all participants. There were no contributions made to the plan for the years ended February 28, 2023, February 28, 2022 and February 28, 2021. e) Deferred Compensation Plan A Deferred Compensation Plan (the “Plan”) was adopted by the Company in 1999 for Vice Presidents and above. The Plan is intended to provide certain executives with supplemental retirement benefits as well as to permit the deferral of more of their compensation than they are permitted to defer under the Profit Sharing and 401(k) Plans. The Plan provides for a matching contribution equal to 25 % of the employee deferrals up to $ 20 to be made at the Company’s discretion. No matching contributions were made for the years ended February 28, 2023, February 28, 2022, and February 28, 2021. The Plan is not intended to be a qualified plan under the provisions of the Internal Revenue Code. All compensation deferred under the Plan is held by the Company in an investment trust which is considered an asset of the Company. The Company has the option of amending or terminating the Plan at any time. The investments, which amounted to $ 1,053 and $ 1,231 at February 28, 2023 and February 28, 2022, respectively, are classified as long-term marketable equity securities and are included in Investment securities on the accompanying Consolidated Balance Sheets and a corresponding liability is recorded in Deferred compensation, which is classified as a non-current liability. Unrealized gains and losses on the marketable securities and corresponding deferred compensation liability net to zero in the accompanying Consolidated Statements of Operations and Comprehensive (Loss) Income . |
Lease Obligations
Lease Obligations | 12 Months Ended |
Feb. 28, 2023 | |
Leases [Abstract] | |
Lease Obligations | 11) Lease Obligations The Company accounts for operating and finance leases in accordance with ASC Topic 842, Leases. We determine whether an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly or implicitly for a period of time in exchange for consideration. Control of an underlying asset is conveyed if we obtain the rights to direct the use of, and to obtain substantially all of the economic benefit from, the use of the underlying asset. Some of our leases include both lease and non-lease components which are accounted for as a single lease component, as we elected the practical expedient in ASC 842-10-15-37. Some of our operating lease agreements include variable lease costs, including taxes, common area maintenance, or increases in rental costs related to inflation. Such variable payments, other than those dependent upon a market index or rate, are expensed when the obligation for those payments is incurred. Lease expense is recorded in operating expenses in the Consolidated Statements of Operations and Comprehensive (Loss) Income . The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. Leases with an initial term of 12 months or less which do not include an option to purchase the underlying asset that the Company is reasonably certain to exercise are considered short term leases and are not recorded on the balance sheet. The Company had no short-term leases during the year ended February 28, 2023. Right-of-use assets and lease liabilities are recognized at each lease’s commencement date based on the present value of its lease payments over its respective lease term. When a borrowing rate is not explicitly available for a lease, our incremental borrowing rate is used based on information available at the lease’s commencement date to determine the present value of its lease payments. Operating lease payments are recognized on a straight-line basis over the lease term. We have operating leases for office equipment, as well as offices, warehouses, and other facilities used for our operations. We also have finance leases comprised primarily of computer hardware and machinery and equipment. Our leases have remaining lease terms of less than 1 year to 8 years , some of which include renewal options. We consider these renewal options in determining the lease term used to establish our right-of-use assets and lease liabilities when it is determined that it is reasonably certain that the renewal option will be exercised. Refer to the Consolidated Statements of Cash Flows for supplemental cash flow information related to leases. The components of lease cost for the year ended February 28, 2023 were as follows: February 28, February 28, February 28, Operating lease cost (a) (c) $ 1,508 $ 1,383 $ 1,169 Finance lease cost: Amortization of right of use assets (a) 283 403 596 Interest on lease liabilities (b) 4 11 28 Total finance lease cost $ 287 $ 414 $ 624 (a) Recorded within Selling, general, and administrative; Engineering and technical support; and Cost of sales on the Consolidated Statements of Operations and Comprehensive (Loss) Income . (b) Recorded within Interest and bank charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . (c) Includes immaterial amounts related to variable rent expense. Supplemental balance sheet information related to leases is as follows: February 28, 2023 February 28, 2022 Operating Leases Operating lease, right of use assets $ 3,632 $ 4,464 Total operating lease right of use assets $ 3,632 $ 4,464 Accrued expenses and other current liabilities $ 1,173 $ 1,255 Operating lease liabilities, less current portion 2,509 3,298 Total operating lease liabilities $ 3,682 $ 4,553 Finance Leases Property, plant and equipment, gross $ 2,754 $ 2,503 Accumulated depreciation ( 2,491 ) ( 2,208 ) Total finance lease right of use assets $ 263 $ 295 Accrued expenses and other current liabilities $ 203 $ 224 Finance lease liabilities, less current portion 63 78 Total finance lease liabilities $ 266 $ 302 Weighted Average Remaining Lease Term Operating leases 5.0 years 5.5 years Finance leases 1.2 years 1.3 years Weighted Average Discount Rate Operating leases 3.83 % 4.01 % Finance leases 3.51 % 3.87 % At February 28, 2023, maturities of lease liabilities for each of the succeeding years were as follows: Operating Leases Finance Leases 2024 $ 1,269 $ 203 2025 780 64 2026 547 — 2027 374 — 2028 245 — Thereafter 787 — Total lease payments 4,002 267 Less imputed interest 320 1 Total $ 3,682 $ 266 As of February 28, 2023, the Company has not entered into any lease agreements that have not yet commenced. The Company owns and occupies buildings as part of its operations. Certain space within these buildings may, from time to time, be leased to third parties from which the Company earns rental income as lessor. This leased space is recorded within property, plant and equipment and was not material to the Company's Consolidated Balance Sheets at February 28, 2023. Rental income earned by the Company for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 was $ 911 , $ 678 , and $ 739 , respectively, which is recorded within Other income (expense). |
Financial Instruments
Financial Instruments | 12 Months Ended |
Feb. 28, 2023 | |
Financial Instruments [Abstract] | |
Financial Instruments | 12) Financial Instruments a) Off-Balance Sheet Risk Commercial letters of credit are issued by the Company during the ordinary course of business through major domestic banks as requested by certain suppliers. The Company also issues standby letters of credit principally to secure certain bank obligations and insurance policies. The Company had no open commercial letters of credit at February 28, 2023. Standby letters of credit amounted to $ 50 at February 28, 2023. The terms of these letters of credit are all less than one year. No material loss is anticipated due to nonperformance by the counter parties to these agreements. The fair value of the standby letters of credit is estimated to be the same as the contract values based on the short-term nature of the fee arrangements with the issuing banks. At February 28, 2023 , the Company had unconditional purchase obligations for inventory commitments of $ 97,606 . These obligations are not recorded in the consolidated financial statements until commitments are fulfilled and such obligations are subject to change based on negotiations with manufacturers. b) Concentrations of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of trade receivables. The Company's customers are located principally in the United States, Canada, Europe, and Asia Pacific and consist of, among others, distributors, mass merchandisers, warehouse clubs, major automobile manufacturers, and independent retailers. The Company generally grants credit based upon analyses of customers' financial conditions and previously established buying and payment patterns. For certain customers, the Company establishes collateral rights in accounts receivable and inventory and obtains personal guarantees from certain customers based upon management's credit evaluation. Certain customers in Europe and Latin America have credit insurance equaling their credit limits. At February 28, 2023 and February 28, 2022 , the Company's five largest customer balances accounted for approximately 20 % and 24 % of accounts receivable, respectively. No single customer accounted for more than 10% of net sales during the years ended February 28, 2023 or February 28, 2022 . One customer in the Company’s Consumer Electronics segment accounted for 12 % of the Company’s total consolidated net sales during the year ended February 28, 2021. The Company's five largest customers represented 17 % , 21 % , and 30 % of net sales during the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively. A portion of the Company's customer base may be susceptible to downturns in the retail economy, particularly in the consumer electronics industry. Additionally, customers specializing in certain automotive sound, security and accessory products may be impacted by fluctuations in automotive sales. |
Financial and Product Informati
Financial and Product Information About Foreign and Domestic Operations | 12 Months Ended |
Feb. 28, 2023 | |
Segment Reporting [Abstract] | |
Financial and Product Information About Foreign and Domestic Operations | 13) Financial and Product Information About Foreign and Domestic Operations Segments The Company classifies its operations in the following three reportable segments: Automotive Electronics, Consumer Electronics, and Biometrics. Our Automotive Electronics segment designs, manufactures, distributes and markets rear-seat entertainment devices, remote start systems, automotive security products and devices, vehicle access systems, mobile interface modules, mobile multimedia devices, aftermarket/OE-styled radios, car link-smartphone telematics applications, driver distraction products, collision avoidance systems, location-based services, turn signal switches, automotive lighting products, obstacle sensing and camera systems, USB ports, cruise control systems, heated seats, and satellite radio products. Our Consumer Electronics segment designs, manufactures, distributes and markets home theater systems, premium loudspeakers, outdoor speakers, A/V receivers, business music systems, streaming music systems, cinema speakers, architectural speakers, wireless and Bluetooth speakers, soundbars, on-ear and in-ear headphones, wired and wireless headphones and ear buds, DLNA (Digital Living Network Alliance) compatible devices, T.V. remote controls, karaoke products, infant/nursery products, personal sound amplifiers, as well as A/V connectivity, portable/home charging, reception and digital consumer products. Our Biometrics segment designs, markets and distributes iris identification and biometric security related products. Each operating segment is individually reviewed and evaluated by our Chief Operating Decision Maker (CODM), who allocates resources and assesses performance of each segment individually. The Company's Chief Executive Officer has been identified as the CODM. The CODM evaluates performance and allocates resources based upon a number of factors, the primary profit measure being income before income taxes of each segment. Certain costs and royalty income are not allocated to the segments and are reported as Corporate/Eliminations. Costs not allocated to the segments include professional fees, public relations costs, acquisition costs and costs associated with executive and corporate management departments, including salaries, benefits, depreciation, rent and insurance. The segments share many common resources, infrastructures, and assets in the normal course of business. Thus, the Company does not report assets or capital expenditures by segment to the CODM. The accounting principles applied at the consolidated financial statement level are generally the same as those applied at the operating segment level and there are no material intersegment sales. The segments are allocated interest expense, based upon a pre-determined formula, which utilizes a percentage of each operating segment's intercompany balance, which is offset in Corporate/Eliminations. Segment data for each of the Company's segments are presented below: Automotive Electronics Consumer Electronics Biometrics Corporate/ Total Fiscal Year Ended February 28, 2023 Net sales $ 174,811 $ 357,758 $ 1,046 $ 399 $ 534,014 Equity in income of equity investees 6,969 — — — 6,969 Interest expense and bank charges 1,917 8,033 1,720 ( 7,027 ) 4,643 Depreciation and amortization expense 3,245 6,534 287 3,064 13,130 Loss before income taxes (a) (b) (c) ( 3,236 ) ( 1,101 ) ( 5,816 ) ( 20,797 ) ( 30,950 ) Fiscal Year Ended February 28, 2022 Net sales $ 200,594 $ 433,925 $ 882 $ 519 $ 635,920 Equity in income of equity investees 7,890 — — — 7,890 Interest expense and bank charges 1,510 7,827 1,662 ( 8,467 ) 2,532 Depreciation and amortization expense 3,049 4,957 297 4,095 12,398 Income (loss) before income taxes (b) 8,471 28,645 ( 9,354 ) ( 53,601 ) ( 25,839 ) Fiscal Year Ended February 28, 2021 Net sales $ 163,903 $ 398,263 $ 836 $ 603 $ 563,605 Equity in income of equity investees 7,350 — — — 7,350 Interest expense and bank charges 1,540 8,537 1,475 ( 8,573 ) 2,979 Depreciation and amortization expense 2,881 3,856 322 3,974 11,033 Income (loss) before income taxes (d) 9,608 38,939 ( 8,726 ) ( 12,183 ) 27,638 (a) Included within Loss before income taxes within the Automotive Electronics segment for the year ended February 28, 2023 is a goodwill impairment charge of $ 7,373 and an intangible asset impairment charge of $ 1,300 (see Note 1(k)) . (b) Included within Income (loss) before income taxes within Corporate/Eliminations for the year ended February 28, 2022 is a charge of $ 39,444 recorded for an interim arbitration award unfavorable to the Company (see Note 15). Included within Loss before income taxes on Corporate/Eliminations for the year ended February 28, 2023 are interest charges of $ 3,944 related to the interim arbitration award. (c) Included within Loss before income taxes within Corporate/Eliminations for the year ended February 28, 2023 are foreign currency losses of $ 3,267 attributable to the Company's Onkyo subsidiary related to intercompany transactions and financial statement translation adjustments. (d) Included within Income (loss) before income taxes within the Consumer Electronics segment for the year ended February 28, 2021 is an intangible asset impairment charge of $ 1,300 (see Note 1(k)). Geographic net sales information in the table below is based on the location of the selling entity. Long-lived assets, consisting of fixed assets, are reported below based on the location of the asset. United Europe Other Total Fiscal Year Ended February 28, 2023 Net sales $ 421,296 $ 79,677 $ 33,041 $ 534,014 Long-lived assets 41,925 3,164 1,955 47,044 Fiscal Year Ended February 28, 2022 Net sales $ 506,226 $ 97,396 $ 32,298 $ 635,920 Long-lived assets 44,751 3,422 1,621 49,794 Fiscal Year Ended February 29, 2021 Net sales $ 477,608 $ 82,134 $ 3,863 $ 563,605 Long-lived assets 46,614 3,569 1,843 52,026 |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 12 Months Ended |
Feb. 28, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | 14) Revenue from Contracts with Customers The Company operates in three reportable segments: Automotive Electronics, Consumer Electronics, and Biometrics. ASC Topic 606 requires further disaggregation of an entity’s revenue. In the following table, the Company's net sales are disaggregated by segments and product type for the years ended February 28, 2023, February 28, 2022, and February 28, 2021. Year Ended Year Ended Year Ended February 29, 2023 2022 2021 Automotive Electronics Segment OEM Products $ 72,979 $ 65,017 $ 46,170 Aftermarket Products 101,832 135,577 117,733 Total Automotive Electronics Segment 174,811 200,594 163,903 Consumer Electronics Segment Premium Audio Products 274,544 343,991 299,908 Other Consumer Electronic Products 83,214 89,934 98,355 Total Consumer Electronics Segment 357,758 433,925 398,263 Biometrics Segment Biometric Products 1,046 882 836 Total Biometrics Segment 1,046 882 836 Corporate/Eliminations 399 519 603 Total Net Sales $ 534,014 $ 635,920 $ 563,605 As of February 28, 2023 and February 28, 2022, the balance of the Company's return asset was $ 2,513 and $ 2,619 , respectively, and the balance of the refund liability was $ 5,181 and $ 5,469 , respectively, which are presented within Prepaid expenses and other current assets and Accrued expenses and other current liabilities, respectively, on the Consolidated Balance Sheets. The Company had current and non-current contract liability balances totaling $ 4,818 at February 28, 2023 related to telematic subscription services. The following table provides a reconciliation of the Company’s contract liabilities as of February 28, 2023 : Balance at February 28, 2022 $ 5,412 Subscription payments received 6,775 Revenue recognized ( 7,369 ) Balance at February 28, 2023 $ 4,818 The Company had no contract asset balances at February 28, 2023 or February 28, 2022 . |
Contingencies
Contingencies | 12 Months Ended |
Feb. 28, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | 15) Contingencies The Company is currently, and has in the past, been a party to various routine legal proceedings incident to the ordinary course of business. If management determines, based on the underlying facts and circumstances of each matter, that it is probable a loss will result from a litigation contingency and the amount of the loss can be reasonably estimated, the estimated loss is accrued. The products the Company sells are continually changing as a result of improved technology. As a result, although the Company and its suppliers attempt to avoid infringing known proprietary rights, the Company may be subject to legal proceedings and claims for alleged infringement by patent, trademark, or other intellectual property owners. Any claims relating to the infringement of third-party proprietary rights, even if not meritorious, could result in costly litigation, divert management’s attention and resources, or require the Company to either enter into royalty or license agreements which are not advantageous to the Company or pay material amounts of damages. In March 2007, the Company entered into a contract with Seaguard Electronics, LLC (“Seaguard”) relating to the Company’s purchase from Seaguard of a stolen vehicle recovery product and back-end services. In August 2018, Seaguard filed a demand for arbitration against the Company with the American Arbitration Association (“AAA”) alleging claims for breach of contract and patent infringement. Seaguard originally sought damages of approximately $ 10,000 and on the seventh day of an eight-day fact witness portion of the arbitration in June 2021, amended its damages demand to $ 40,000 , which was affected by the service of Claimant’s notice dated July 14, 2021. On November 29, 2021, the Arbitrator issued an interim award (the “Interim Award”) with Seaguard prevailing on its breach of contract claim. The Company’s affirmative defenses relating to those claims, however, were denied in their entirety. Seaguard was awarded damages in the amount of $ 39,444 against the Company. On March 3, 2022, the Arbitrator issued a Partial Final Award on Bifurcated Issue in the amount of $ 39,444 , plus $ 798 for its attorneys’ fees and costs. On March 11, 2022, the Arbitrator fixed the schedule of the patent portion of the bifurcated arbitration, with a trial date set for October 16, 2023. The Company has put its suppliers on notice of its indemnification rights with respect to the alleged infringing products. On March 14, 2022, Seaguard filed a Petition in the United States District Court, Central District of California, Western Division, to confirm the Partial Final Award. On April 25, 2022, the Company filed its opposition to Seaguard’s Petition to Confirm and a Counter-Petition to Vacate the Partial Final Award. On May 31, 2022, the Court ordered the matter taken under submission for decision without oral hearing. The court has issued an Order informing the parties that it will rule on the pending Petitions by August 3, 2023. During the year ended February 28, 2022, the Company recorded a charge of $ 39,444 within Other (expense) income in the accompanying Consolidated Statements of Operations and Comprehensive (Loss) Income. During the year ended February 28, 2023, the Company accrued charges of $ 3,944 representing interest due on the award when paid, if confirmed and not vacated by the U.S. District Court or an appellate court. At February 28, 2023 and February 28, 2022, the Company had a total accrued balance of $ 43,388 and $ 39,444 , respectively, on the accompanying Consolidated Balance Sheets related to the interim arbitration award. No accrual or reserve was included in the Company’s issued financial statements prior to the year ended February 28, 2022, based on an assessment that an award of damages in the arbitration proceeding would not be material and that the amount as determined by the Arbitrator’s award was not probable. The Company made its accrual determination in accordance with reports and evaluations from its damages expert, as well as from the guidance and opinion letters received from the Company’s trial attorneys. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Feb. 28, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 16) Subsequent Events We have evaluated subsequent events from March 1, 2023 through the filing date of this Form 10K on May 15, 2023. Based on this evaluation, we did not identify any events that would have required recognition or disclosure in these consolidated financial statements, except for the First Amendment and Supplement to the Indenture of Trust relating to the Florida Industrial Revenue Bonds and the Amended and Restated Confirmation of Swap Transaction, as discussed in Note 7. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Feb. 28, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDU LE II VOXX INTERNATIONAL CORPORATION AND SUBSIDIARIES Valuation and Qualifying Accounts Years ended February 28, 2023, February 28, 2022, and February 28, 2021 (In thousands) Column A Column B Column C Column D Column E Description Balance at Gross Reversals of Deductions Balance Year ended February 28, 2023 Allowance for credit losses $ 2,182 $ ( 717 ) $ — $ 67 $ 1,398 Cash discount allowances 1,108 5,218 — 5,209 1,117 Sales return reserve 5,469 22,659 — 22,947 5,181 Year ended February 28, 2022 Allowance for credit losses $ 1,593 $ 863 $ — $ 274 $ 2,182 Cash discount allowances 1,104 6,320 — 6,316 1,108 Sales return reserve 5,145 9,571 — 9,247 5,469 Year ended February 28, 2021 Allowance for credit losses $ 1,954 $ ( 271 ) $ — $ 90 $ 1,593 Cash discount allowances 751 6,565 — 6,212 1,104 Sales return reserve 3,779 16,550 — 15,184 5,145 (a) For the allowance for credit losses and cash discount allowances, deductions represent currency effects, chargebacks and payments made or credits issued to customers. |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
Description of Business | a) Description of Business VOXX International Corporation ("Voxx," "We," "Our," "Us" or the “Company") is a leading international manufacturer and distributor in the Automotive Electronics, Consumer Electronics, and Biometrics industries. The Company has widely diversified interests, with more than 30 global brands that it has acquired and grown throughout the years, achieving a powerful international corporate image, and creating a vehicle for each of these respective brands to emerge with its own identity. We conduct our business through nineteen wholly-owned subsidiaries: Audiovox Atlanta Corp., VOXX Electronics Corporation, VOXX Accessories Corp., VOXX German Holdings GmbH ("Voxx Germany"), Audiovox Canada Limited, Voxx Hong Kong Ltd., Audiovox International Corp., Audiovox Mexico, S. de R.L. de C.V. ("Voxx Mexico"), Code Systems, Inc., Oehlbach Kabel GmbH ("Oehlbach"), Schwaiger GmbH ("Schwaiger"), Invision Automotive Systems, Inc. ("Invision"), Premium Audio Company LLC ("PAC," which includes Klipsch Group, Inc. and 11 Trading Company LLC), Omega Research and Development, LLC ("Omega"), Voxx Automotive Corp., Audiovox Websales LLC, VSM-Rostra LLC (“VSM”), VOXX DEI LLC, and VOXX DEI Canada LLC (collectively, with VOXX DEI LLC, “DEI”), as well as majority-owned subsidiaries, EyeLock LLC ("EyeLock") and Onkyo Technology KK (“Onkyo”). We market our products under the Audiovox® brand name, other brand names and licensed brands, such as 808®, Acoustic Research®, Advent®, Avital®, Car Link®, Chapman®, Clifford®, Code-Alarm®, Crimestopper , Discwasher®, Energy®, Heco®, Invision®, Integra®, Jamo®, Klipsch®, Mac Audio , Magnat®, myris®, Oehlbach®, Omega®, Onkyo®, Pioneer®, Prestige®, Project Nursery®, Python®, RCA®, RCA Accessories®, Rosen®, Rostra®, Schwaiger®, Smart Start®, Terk®, Vehicle Safety Automotive, Viper®, and Voxx Automotive, as well as private labels through a large domestic and international distribution network. We also function as an OEM ("Original Equipment Manufacturer") supplier to several customers, as well as market a number of products under exclusive distribution agreements, such as SiriusXM satellite radio products. The Company's fiscal year ends on the last day of February. |
Principles of Consolidation, Reclassifications and Accounting Principles | b) Principles of Consolidation, Reclassifications and Accounting Principles The consolidated financial statements and accompanying notes include the financial statements of VOXX International Corporation and its wholly and majority-owned subsidiaries and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), as defined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 270, and in accordance with accounting principles generally accepted in the United States of America (“GAAP”). All significant intercompany balances and transactions have been eliminated in consolidation. Certain amounts in the prior years have been reclassified to conform to the current year presentation. Non-controlling interests represent the equity interests in our consolidated entities that we do not wholly own. Our financial statements reflect 100 % of the revenues, expenses, assets, and liabilities (after elimination of intercompany transactions), although we do not own 100 % of the equity interests of these consolidated entities. The Company follows FASB ASC 810-10-45-21 to report a non-controlling interest (other than non-controlling interests subject to a put option) in the consolidated balance sheets within the equity section, separately from the Company’s retained earnings. Non-controlling interest represents the non-controlling interest holders’ proportionate shares of the equity of the Company’s majority-owned subsidiary, EyeLock. Non-controlling interest is adjusted for the non-controlling interest holders’ proportionate shares of the earnings or losses and other comprehensive (loss) income, if any, and the non-controlling interest continues to be attributed their share of losses even if that attribution results in a deficit non-controlling interest balance. We classify securities with redemption features that are not solely within our control, such as our non-controlling interest that is subject to a put option, outside of permanent equity, specifically the non-controlling shareholder interest in Onkyo. This redeemable non-controlling interest, subject to put option, is recorded at the greater of the non-controlling interest balance determined pursuant to ASC 810-10, “Consolidation,” or the redemption value (which is based upon the greater of a specified formula). Changes in the non-controlling interest due to changes in the redemption amount are immediately recorded as equity transactions and our earnings per share calculation would be adjusted accordingly to treat any redemption adjustment similar to a dividend. Equity investments in which the Company exercises significant influence but does not control and is not the primary beneficiary are accounted for using the equity method. The Company's share of its equity method investee's earnings or losses is included in Other (expense) income in the accompanying Consolidated Statements of Operations and Comprehensive (Loss) Income . The Company eliminates its pro rata share of gross profit on sales to its equity method investee for inventory on hand at the investee at the end of the year. Investments in which the Company does not exercise significant influence over the investee, and which do not have readily determinable fair values, are accounted for under the cost method. |
Use of Estimates | c) Use of Estimates The preparation of these consolidated financial statements requires the Company to make estimates and assumptions that affect reported amounts of assets, liabilities, revenue, and expenses. Such estimates include revenue recognition; accrued sales incentives; the allowance for doubtful accounts; inventory valuation; valuation of long-lived assets; valuation and impairment assessment of goodwill, trademarks, and other intangible assets; warranty reserves; stock-based compensation; recoverability of deferred tax assets; and the reserve for uncertain tax positions at the date of the consolidated financial statements. Actual results could differ from those estimates. |
Cash and Cash Equivalents | d) Cash and Cash Equivalents Cash and cash equivalents consist of demand deposits with banks and highly liquid money market funds with original maturities of three months or less when purchased. Cash and cash equivalents amounted to $ 6,134 and $ 27,788 at February 28, 2023, and February 28, 2022, respectively. The Company places its cash and cash equivalents in institutions and funds of high credit quality. As many of our balances are in excess of government insurance, we perform periodic evaluations of these institutions and funds. Cash amounts held in foreign bank accounts amounted to $ 129 and $ 762 at February 28, 2023, and February 28, 2022 , respectively, none of which would be subject to United States federal income taxes if made available for use in the United States. The Tax Cuts and Jobs Act provides a 100 % participation exemption on dividends received from foreign corporations after January 1, 2018, as the United States has moved away from a worldwide tax system and closer to a territorial system for earnings of foreign corporations. |
Fair Value Measurements and Derivatives | e) Fair Value Measurements and Derivatives The Company applies the authoritative guidance on "Fair Value Measurements," which among other things, requires enhanced disclosures about investments that are measured and reported at fair value. This guidance establishes a hierarchal disclosure framework that prioritizes and ranks the level of market price observability used in measuring investments at fair value. Market price observability is impacted by a number of factors, including the type of investment and the characteristics specific to the investment. Investments with readily available active quoted prices, or for which fair value can be measured from actively quoted prices, generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value. Investments measured and reported at fair value are classified and disclosed in one of the following categories: Level 1 - Quoted market prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 inputs that are either directly or indirectly observable. Level 3 - Unobservable inputs developed using the Company's estimates and assumptions, which reflect those that market participants would use. The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2023: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 6,134 $ 6,134 $ — $ — Mutual funds 1,053 1,053 - - Derivatives designated for hedging 207 - 207 - Liabilities: Contingent consideration $ 4,500 $ — $ — $ 4,500 The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2022: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 27,788 $ 27,788 $ — $ — Mutual funds 1,231 1,231 - - Liabilities: Derivatives designated for hedging $ 188 $ — $ 188 $ — Contingent consideration 6,435 - - 6,435 The carrying value of the Company's accounts receivable, short-term debt, accounts payable, accrued expenses, bank obligations and long-term debt approximates fair value because of either (i) the short-term nature of the financial instrument; (ii) the interest rate on the financial instrument being reset every quarter to reflect current market rates, or (iii) the stated or implicit interest rate approximates the current market rates or are not materially different than market rates. Contingent consideration is related to the Company’s Onkyo acquisition (see Note 2). The estimated fair value of the contingent consideration is classified within Level 3 and was determined using an income approach. Under this method, potential future purchases applicable to the contingent consideration were determined using internal estimates for growth. The potential future purchases applicable to the contingent consideration were multiplied by the appropriate percentage of payments due to OHEC, and the resulting contingent consideration amounts were adjusted for risk at the appropriate discount rate. The value of the contingent consideration was further discounted to reflect the credit risk of the Company. On May 13, 2022 , OHEC filed for bankruptcy protection in Japan. On February 10, 2023, the contingent consideration obligation was settled with the bankruptcy trustee of OHEC for $ 6,000 , for a gain of $ 443 (see Note 2). This settlement relieves Onkyo from the future payments of 2 % of the total purchase price of certain future product purchases that were to be made in perpetuity. The $ 6,000 settlement amount is to be paid in three installments. The first installment of $ 1,500 was made in February 2023. The remaining installments totaling $ 4,500 , as of February 28, 2023, are expected to be made in Fiscal 2024 after the completion of the obligation of the bankruptcy trustee of OHEC under the settlement agreement. The following table provides a rollforward of the Company's contingent consideration balance for the year ended February 28, 2023: Balance at February 28, 2022 $ 6,435 Payments ( 1,620 ) Fair value adjustment 50 Purchase price allocation adjustment 1,051 Gain on settlement ( 443 ) Foreign currency translation ( 973 ) Balance at February 28, 2023 $ 4,500 Non-financial Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain long-lived non-financial assets and liabilities may be required to be measured at fair value on a nonrecurring basis in certain circumstances, including when there is evidence of impairment. These non-financial assets and liabilities may include assets acquired in a business combination or property and equipment that are determined to be impaired. As of February 28, 2022, and February 28, 2021, certain non-financial assets were measured at fair value subsequent to their initial recognition. See Note 1(k) for the discussion of the impairment of certain intangible assets. Derivative Instruments The Company's derivative instrument consists of an interest rate swap agreement at February 28, 2023. Forward foreign currency contracts are also utilized by the Company from time to time to hedge a portion of its foreign currency inventory purchases. The forward foreign currency derivatives qualifying for hedge accounting are designated as cash flow hedges and valued using observable forward rates for the same or similar instruments (Level 2). Open foreign currency contracts are classified in the balance sheet according to their terms. There are currently no open forward foreign currency contracts at February 28, 2023 . The Company’s interest rate swap agreement hedges interest rate exposure related to the forecasted outstanding balance of its Florida Mortgage with monthly payments due through March 2026. The swap agreement locks the interest rate on the debt at 3.48 % (inclusive of credit spread) through the maturity date of the mortgage. Interest rate swap agreements qualifying for hedge accounting are designated as cash flow hedges and valued based on a comparison of the change in fair value of the actual swap contracts designated as the hedging instruments and the change in fair value of a hypothetical swap contract (Level 2). We calculate the fair value of our interest rate swap agreement quarterly based on the quoted market price for the same or similar financial instruments. The interest rate swap is classified in the balance sheet as either an asset or a liability based on the fair value of the instrument at the end of the period. Financial Statement Classification The Company holds derivative instruments that are designated as hedging instruments. The following table discloses the fair value as of February 28, 2023 and February 28, 2022 for derivative instruments: Derivative Assets and Liabilities Fair Value Account February 28, 2023 February 28, 2022 Designated derivative instruments Interest rate swap Other assets $ 207 $ - Other long-term liabilities - ( 188 ) Total derivatives $ 207 $ ( 188 ) Cash flow hedges It is the Company's policy to enter into derivative instrument contracts with terms that coincide with the underlying exposure being hedged. As such, the Company's derivative instruments are expected to be highly effective. For derivative instruments that are designated and qualify as a cash flow hedge, the entire change in fair value of the hedging instrument included in the assessment of the hedge ineffectiveness is recorded to other comprehensive income (“OCI”). When the amounts recorded in OCI are reclassified to earnings, they are presented in the same income statement line item as the effect of the hedged item. During Fiscal 2023 and Fiscal 2022, the Company did not enter into any new forward foreign currency contracts. All forward foreign currency contracts entered into during Fiscal 2021 were settled as of February 28, 2022 and were designated as cash flow hedges. The current outstanding notional value of the Company's interest rate swap at February 28, 2023 is $ 6,115 . For cash flow hedges, the effective portion of the gain or loss is reported as a component of Other comprehensive (loss) income and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. No amounts were excluded from the assessment of hedge effectiveness during the respective periods. During the years ended February 28, 2023 and February 28, 2022 , no contracts originally designated for hedge accounting were de-designated. The gain or loss on the Company’s interest rate swap is recorded in Other comprehensive (loss) income and subsequently reclassified into Interest and bank charges in the period in which the hedged transaction affects earnings. As of February 28, 2023 , no contracts originally designated for hedge accounting were terminated. Activity related to cash flow hedges recorded during the twelve months ended February 28, 2023 and February 28, 2022 was as follows: February 28, 2023 February 28, 2022 Gain Loss Gain Loss Cash flow hedges Foreign currency contracts $ - $ 63 $ 233 $ ( 307 ) Interest rate swaps $ 395 $ — $ 258 $ — |
Investment Securities | f) Investment Securities As of February 28, 2023 and February 28, 2022, the Company had the following investments: February 28, 2023 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,053 Total Marketable Equity Securities 1,053 Total Investment Securities $ 1,053 February 28, 2022 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,231 Total Marketable Equity Securities 1,231 Total Investment Securities $ 1,231 Long-Term Investments Equity Securities Marketable equity securities are measured and recorded at fair value with changes in fair value recorded in the Consolidated Statements of Operations and Comprehensive (Loss) Income. Mutual Funds The Company’s mutual funds are held in connection with its deferred compensation plan. Changes in the carrying value of these securities are offset by changes in the corresponding deferred compensation liability. Changes in fair value of equity securities are recorded within the Consolidated Statements of Operations and Comprehensive (Loss) Income. Investments Held at Cost, Less Impairment During Fiscal 2018, RxNetworks, a Canadian company in which Voxx held a cost method investment consisting of shares of the investee's preferred stock, was sold to a third party. The cash proceeds received by Voxx was subject to a hold-back provision, which was not included in the calculation of the gain recorded on the sale of this investment in Fiscal 2018. In Fiscal 2020, the Company received a portion of the proceeds that were held back in the Fiscal 2018 transaction to sell the RxNetworks investment, as the hold-back provision expired, and certain cash proceeds were released to Voxx. These cash proceeds were recorded as an investment gain in Fiscal 2020. During the third quarter of Fiscal 2021, a final disbursement of all remaining proceeds related to the sale of the RxNetworks investment was received in the amount of $ 42 , which was recorded as an investment gain for the year ended February 28, 2021. |
Revenue Recognition | g) Revenue Recognition The Company accounts for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers. Revenue from Contracts with Customers The core principle of ASC Topic 606 is that an entity recognizes revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. We apply the FASB’s guidance on revenue recognition, which requires us to recognize the amount of revenue and consideration that we expect to receive in exchange for goods and services transferred to our customers. To do this, the Company applies the five-step model prescribed by the FASB, which requires us to: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when, or as, we satisfy a performance obligation. We account for a contract or purchase order when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the product passes to the customer, which is upon shipment, unless otherwise specified within the customer contract or on the purchase order as delivery and is recognized at the amount that reflects the consideration the Company expects to receive for the products sold, including various forms of discounts. When revenue is recorded, estimates of returns are made and recorded as a reduction of revenue. Contracts with customers are evaluated to determine if there are separate performance obligations related to timing of product shipment that will be satisfied in different accounting periods. When that is the case, revenue is deferred until each performance obligation is met. Within our Automotive Electronics segment, while the majority of the contracts we enter into with Original Equipment Manufacturers (“OEM”) are long-term supply arrangements, the performance obligations are established by the enforceable contract, which is generally considered to be the purchase order. The purchase orders are of durations less than one year. As such, the Company applies the practical expedient in ASC 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less, for which work has not yet been performed. The Company has also elected the practical expedient in ASC 340-40-25-4, whereby the Company recognizes incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets the Company otherwise would have recognized is one year or less. Certain taxes assessed by governmental authorities on revenue producing transactions, such as value added taxes, are excluded from revenue, and recorded on a net basis. Performance Obligations The Company’s primary source of revenue is derived from the manufacture and distribution of automotive electronic, consumer electronic, and biometric products. Our consumer electronic products primarily consist of finished goods sold to retail and commercial customers, consisting of premium audio and other consumer electronic products. Our automotive products, some of which are manufactured by the Company, are sold both to OEM and aftermarket customers. Our biometric products, primarily consisting of finished goods, are sold to retail and commercial customers. We recognize revenue for sales to our customers when transfer of control of the related good or service has occurred. The majority of our revenue was recognized under the point in time approach for the years ended February 28, 2023, February 28, 2022, and February 28, 2021. Certain telematic subscription revenues generated by our Automotive Electronics segment are recognized over time. Contract terms with certain of our OEM customers could result in products and services being transferred over time as a result of the customized nature of some of our products, together with contractual provisions in the customer contracts that provide us with an enforceable right to payment for performance completed to date; however, under typical terms, we do not have the right to consideration until the time of shipment from our manufacturing facilities or distribution centers, or until the time of delivery to our customers. If certain contracts in the future provide the Company with this enforceable right of payment, the timing of revenue recognition from products transferred to customers over time may be slightly accelerated compared to our right to consideration at the time of shipment or delivery. Our typical payment terms vary based on the customer and the type of goods and services in the contract or purchase order. The period of time between invoicing and when payment is due is not significant. Amounts billed and due from our customers are classified as receivables on the Consolidated Balance Sheet. As our standard payment terms are less than one year, we have elected the practical expedient under ASC paragraph 606-10-32-18 to not assess whether a contract has a significant financing component. Our customers take delivery of goods, and they are recognized as revenue at the time of transfer of control to the customer, which is usually at the time of shipment, unless otherwise specified in the customer contract or purchase order. This determination is based on applicable shipping terms, as well as the consideration of other indicators, including timing of when the Company has a present right to payment, when physical possession of products is transferred to customers, when the customer has the significant risks and rewards of ownership of the asset, and any provisions in contracts regarding customer acceptance. While unit prices are generally fixed, we provide variable consideration for certain of our customers, typically in the form of promotional incentives at the time of sale. Depending on the different facts and circumstances, we utilize either the most likely amount or the expected value methods to estimate the effect of uncertainty on the amount of variable consideration to which we would be entitled. The most likely amount method considers the single most likely amount from a range of possible consideration amounts, while the expected value method is the sum of the probability-weighted amounts in a range of possible consideration amounts. Both methods are based upon the contractual terms of the incentives and historical experience with each customer. We record estimates for cash discounts, promotional rebates, and other promotional allowances in the period the related revenue is recognized (“Customer Credits”). The provision for Customer Credits is recorded as a reduction from gross sales and reserves for Customer Credits are presented within Accrued sales incentives on the Consolidated Balance Sheet. Actual Customer Credits have not differed materially from estimated amounts for each period presented. Amounts billed to customers for shipping and handling are included in net sales and costs associated with shipping and handling are included in cost of sales. We have concluded that our estimates of variable consideration are not constrained according to the definition within the standard. Additionally, the Company applies the practical expedient in ASC paragraph 606-10-25-18B and accounts for shipping and handling activities that occur after the customer has obtained control of a good as a fulfillment activity, rather than a separate performance obligation. Under ASC Topic 606, we present a refund liability and a return asset within the Consolidated Balance Sheet. The changes in the refund liability are reported in net sales, and the changes in the return asset are reported in cost of sales in the Consolidated Statements of Operations and Comprehensive (Loss) Income. See Note 14 for return asset and refund liability balances as of February 28, 2023 and February 28, 2022. We warrant our products against certain defects in material and workmanship, when used as designed, for periods of time which primarily range from 30 days to 3 years. We offer limited lifetime warranties on certain products, which limit the customer’s remedy to the repair or replacement of the defective product or part for the original owner for the designated lifetime of the product, or for the life of the vehicle, if it is an automotive product. We do not sell extended warranties. Contract Balances Contract assets primarily relate to the Company’s rights to consideration for work completed but not billed at the reporting date on contracts with customers. Contract assets are transferred to receivables when the rights become unconditional. Contract liabilities primarily relate to contracts where advance payments or deposits have been received, but performance obligations have not yet been met, and therefore, revenue has not been recognized. See Note 14 for contract asset and liability balances as of February 28, 2023 and February 28, 2022 . |
Accounts Receivable | h) Accounts Receivable The majority of the Company's accounts receivable are due from companies in the retail, mass merchant and OEM industries. Credit is extended based on an evaluation of a customer's financial condition. Accounts receivable are generally due within 30 days to 60 days and are stated at amounts due from customers, net of an allowance for credit losses. Accounts outstanding longer than the contracted payment terms are considered past due. Accounts receivable are comprised of the following: February 28, February 28, Trade accounts receivable $ 85,268 $ 108,915 Less: Allowance for credit losses 1,398 2,182 Allowance for cash discounts 1,117 1,108 $ 82,753 $ 105,625 The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customers' current credit worthiness, as determined by a review of their current credit information. The Company continuously monitors collections and payments from its customers and maintains a provision for estimated credit losses based upon historical experience and any specific customer collection issues that have been identified. While such credit losses have historically been within management's expectations and the provisions established, the Company cannot guarantee it will continue to experience the same credit loss rates that have been experienced in the past. The Company writes off accounts receivable balances when collection efforts have been exhausted and deemed uncollectible. Our five largest customer balances comprise 20 % of our accounts receivable balance as of February 28, 2023. A significant change in the liquidity or financial position of any one of these customers could have a material adverse impact on the collectability of accounts receivable and our results of operations. On March 1, 2020 , we adopted Accounting Standards Update (“ASU”) 2016-13 , “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which did not have a material impact on our financial statements. Our financial instruments consist of trade receivables arising from revenue transactions in the ordinary course of business. We extend credit to customers based on pre-defined criteria and trade receivables are generally due within 30 to 60 days . The Company has three supply chain financing agreements and factoring agreements with certain financial institutions to accelerate receivable collection and better manage cash flow. Under the agreements, the Company has agreed to sell these institutions certain of its accounts receivable balances from time to time. For those accounts receivables tendered to the banks that the banks choose to purchase, the banks have agreed to advance an amount equal to the net accounts receivable balances due, less a discount or fee as set forth in the respective agreements. The balances under these agreements are sold without recourse and are accounted for as sales of accounts receivable. Cash proceeds from these agreements are reflected as operating activities included in the change in accounts receivable in the Company's Consolidated Statements of Cash Flows. Total balances sold under the agreements, net of discounts, for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 were approximately $ 98,300 , $ 89,400 , and $ 100,800 , respectively. Fees incurred in connection with these agreements totaled approximately $ 730 , $ 260 , and $ 330 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively, and are recorded within Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income . The Company has the option to suspend and resume its activity under the existing arrangements at any time. |
Inventory | i) Inventory The Company values its inventory at the lower of cost or net realizable value ("NRV"). NRV is defined as estimated selling prices less costs of completion, disposal, and transportation. The cost of inventory is determined primarily on an average basis with a portion valued at standard cost, which approximates actual costs on the first-in, first-out basis. The Company regularly reviews inventory quantities on-hand and records a provision for excess and obsolete inventory based primarily on selling prices, indications from customers based upon current price negotiations, and purchase orders. The Company's industry is characterized by rapid technological change and frequent new product introductions that could result in an increase in the amount of obsolete inventory quantities on-hand. In addition, and as necessary, specific reserves for future known or anticipated events may be established. The Company recorded inventory write-downs of $ 2,811 , $ 2,912 , and $ 2,032 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively. Inventories by major category are as follows: February 28, February 28, Raw materials $ 28,048 $ 23,904 Work in process 1,363 1,519 Finished goods 145,718 149,499 Inventory, net $ 175,129 $ 174,922 |
Property, Plant and Equipment | j) Property, Plant and Equipment Property, plant, and equipment are stated at cost less accumulated depreciation. Property under a finance lease is stated at the present value of minimum lease payments. Major improvements and replacements that extend service lives of the assets are capitalized. Minor replacements, and routine maintenance and repairs are charged to expense as incurred. Upon retirement or disposal of assets, the cost and related accumulated depreciation are removed from the Consolidated Balance Sheets. A summary of property, plant and equipment, net, is as follows: February 28, February 28, Land $ 7,101 $ 7,046 Buildings 44,669 44,177 Property under finance lease 2,754 2,503 Furniture and fixtures 4,600 4,489 Machinery and equipment 10,514 10,287 Construction-in-progress 748 3,341 Computer hardware and software 46,313 41,962 Automobiles 681 710 Leasehold improvements 3,008 2,718 120,388 117,233 Less accumulated depreciation and amortization 73,344 67,439 $ 47,044 $ 49,794 Depreciation is calculated on the straight-line method over the estimated useful lives of the assets as follows: Buildings and improvements 20 - 40 years Furniture and fixtures 5 - 15 years Machinery and equipment 5 - 15 years Computer hardware and software 3 - 5 years Automobiles 3 years Leasehold improvements are depreciated over the shorter of the lease term or estimated useful life of the asset. Assets acquired under finance leases are amortized over the term of the respective lease. Depreciation and amortization of property, plant and equipment amounted to $ 6,282 , $ 5,890 , and $ 5,607 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively. Included in depreciation and amortization expense is amortization of computer software costs of $ 1,659 , $ 1,547 , and $ 1,252 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 , respectively. |
Goodwill and Intangible Assets | k) Goodwill and Intangible Assets Goodwill and other intangible assets consist of the excess over the fair value of net assets acquired (goodwill) and other intangible assets (patents, contracts, trademarks/tradenames, developed technology and customer relationships). Values assigned to the respective assets are determined in accordance with ASC 805 "Business Combinations" ("ASC 805") and ASC 350 "Intangibles – Goodwill and Other" ("ASC 350"). Goodwill is calculated as the excess of the cost of purchased businesses over the fair value of the underlying net assets acquired. We use various valuation techniques to determine the fair value of the assets acquired, with the primary techniques being the discounted future cash flow method, relief from royalty method, and the multi-period excess earnings methods, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. Inputs to these valuation approaches that require significant judgment include: (i) forecasted sales, growth rates and customer attrition rates, (ii) forecasted operating margins, (iii) royalty rates and discount rates used to present value future cash flows, (iv) the amount of synergies expected from the acquisition, (v) the economic useful life of assets, and (vi) the evaluation of historical tax positions. In certain instances, historical data is limited so we base our estimates and assumptions on budgets, business plans, economic projections, anticipated future cash flows and marketplace data. The guidance in ASC 350, including management’s business intent for its use; ongoing market demand for products relevant to the category and their ability to generate future cash flows; legal, regulatory, or contractual provisions on its use or subsequent renewal, as applicable; and the cost to maintain or renew the rights to the assets, are considered in determining the useful life of all intangible assets. If the Company determines that there are no legal, regulatory, contractual, competitive, economic, or other factors which limit the useful life of the asset, an indefinite life will be assigned and evaluated for impairment as indicated below. Goodwill and other intangible assets that have an indefinite useful life are not amortized. Intangible assets that have a definite useful life are amortized on either an accelerated or a straight-line basis over their estimated useful lives. ASC 350 requires that goodwill and intangible assets with indefinite useful lives be tested for impairment at least annually or more frequently if an event occurs or circumstances change that could more likely than not reduce the fair value of a reporting unit below its carrying value. Intangible assets with estimable useful lives are required to be amortized over their respective estimated useful lives and reviewed for impairment if indicators of impairment exist . To determine the fair value of goodwill and intangible assets, there are many assumptions and estimates used that directly impact the results of the testing. Management has the ability to influence the outcome and ultimate results based on the assumptions and estimates chosen. If a significant change in these assumptions and/or estimates occurs, the Company could experience impairment charges, in addition to those noted below, in future periods. Goodwill and indefinite-lived intangible assets are tested annually for impairment on the last day of the Company’s fiscal year, and at any time upon occurrence of certain events or changes in circumstances. When testing goodwill and/or indefinite-lived intangible assets for impairment, we have the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of a reporting unit or indefinite-lived intangible asset is less than its carrying amount. If we elect to perform a qualitative assessment and determine that an impairment is more likely than not, we are then required to perform a quantitative impairment test; otherwise, no further analysis is required. Under the qualitative assessment, we consider various qualitative factors, including macroeconomic conditions, relevant industry and market trends, cost factors, overall financial performance, other entity-specific events, and events affecting the reporting unit or indefinite-lived intangible asset that could indicate a potential change in fair value of our indefinite-lived intangible asset or reporting unit or the composition of its carrying values. We also consider the specific future outlook for the reporting unit or indefinite-lived intangible asset. We also may elect not to perform the qualitative assessment and instead, proceed directly to the quantitative impairment test. Goodwill is considered impaired if the carrying value of the reporting unit's goodwill exceeds its estimated fair value. Intangible assets with indefinite lives are considered impaired if the carrying value exceeds the estimated fair value. The Company tested its indefinite-lived intangible assets as of February 28, 2023, as part of its annual impairment testing and concluded that the fair value of one indefinite-lived asset in the Automotive Electronics segment was less than the amount recorded, and accordingly, recorded a non-cash impairment charge of $ 1,300 in the fourth quarter of the fiscal year ended February 28, 2023. This impairment was the result of reductions in projected volumes from OEM customers. The impairment test on the remaining indefinite-lived assets concluded that none of these indefinite-lived assets were impaired for the year ended February 28, 2023. To perform these quantitative impairment analyses, the respective fair values were estimated using a relief-from-royalty method, applying royalty rates ranging from 1.25 % to 5.5 % for the trademarks after reviewing comparable market rates, the profitability of the products associated with relative intangible assets, and other qualitative factors. We determined that risk-adjusted discount rates ranging from 13.5 % to 16.5 % were appropriately developed using a weighted average cost of capital analysis. The long-term growth rates ranged from 1.5 % to 2.5 %. There were no indefinite-lived asset impairments in the fiscal year ended February 28, 2022. At February 28, 2021, one of the indefinite-lived asset in the Consumer Electronics segment was impaired in the amount of $ 1,300 . The impairment was the result of shortfalls in sales due to reduced demand of the product category. The assessments on the remaining indefinite-lived intangibles concluded that there was no additional impairment as of February 28, 2021. As a result of the Fiscal 2023 and 2021 indefinite-lived intangible asset impairments, the Company evaluated the related long-lived assets at the lowest level for which there are separately identifiable cash flows. No impairments of related long-lived assets were noted for the fiscal years ended February 28, 2023, February 28, 2022, and February 28, 2021. As of February 28, 2023, as a result of reductions in projected volumes from OEM customers related to the impaired tradename, the Company determined the useful life of the tradename was no longer indefinite. Beginning in the first quarter of Fiscal 2024, the Company will amortize this tradename over its estimated useful life. Management determined that the current lives of its remaining indefinite and long-lived assets are appropriate. Approximately 17.7 % ($ 9,872 ) of the carrying value of the Company's remaining indefinite lived trademarks are at risk of impairment and sensitive to changes and assumptions as of February 28, 2023 (exclusive of the impaired tradename that is now long-lived). There can be no assurance that our estimates and assumptions made for purposes of impairment testing as of February 28, 2023, will prove to be accurate predictions of the future. Reduced demand for our existing product offerings, reductions of product placement at our customers, less than anticipated results, lack of acceptance of our new products, elimination of SKUs, the inability to successfully develop our brands, or unfavorable changes in assumptions used in the discounted cash flow model such as discount rates, royalty rates or projected long-term growth rates, could result in additional impairment charges in the future. During the year ended February 28, 2023, Voxx's reporting units that carried goodwill were Invision, Rosen, VSM, DEI, Klipsch, and Onkyo. The Company has three operating segments based upon its products and internal organizational structure (see Note 13). These operating segments are the Automotive Electronics, Consumer Electronics, and Biometrics segments. The Invision, Rosen, VSM, and DEI reporting units are located within the Automotive Electronics segment and the Klipsch and Onkyo reporting units are located within the Consumer Electronics segment. The Company performed its annual impairment test for goodwill as of February 28, 2023 and concluded that the fair value of the Invision reporting unit was less than its carrying value, and accordingly recorded a non-cash goodwill impairment charge of $ 7,373 in the fourth quarter of Fiscal 2023. This impairment was the result of reductions in projected volumes from OEM customers. As a result of this impairment the Company no longer has any goodwill attributable to the Invision reporting unit. The annual impairment test on the remaining goodwill reporting units concluded that their fair values were in excess of their carrying values, with no further goodwill impairment indicated as of February 28, 2023. The discount rates (developed using a weighted average cost of capital analysis) used in the goodwill quantitative tests ranged from 14.9 % to 25.0 %. No goodwill impairment charges were recorded during the years ended February 28, 2022 and February 28, 2021. The goodwill balances of Klipsch, Rosen, VSM, DEI, and Onkyo at February 28, 2023 are $ 46,532 , $ 880 , $ 572 , $ 1,600 , and $ 15,724 , respectively. Goodwill The change in the carrying value of goodwill is as follows: February 28, 2023 February 28, 2022 February 28, 2021 Beginning of period $ 74,320 $ 58,311 $ 55,000 Goodwill acquired (see Note 2) — 18,160 3,290 Adjustments to goodwill acquired, net (see Note 2) 1,051 ( 1,353 ) 21 Impairment charge ( 7,373 ) — — Foreign currency translation ( 2,690 ) ( 798 ) — End of period $ 65,308 $ 74,320 $ 58,311 Gross carrying value $ 104,844 $ 106,483 $ 90,474 Accumulated impairment charges ( 39,536 ) ( 32,163 ) ( 32,163 ) Net carrying value $ 65,308 $ 74,320 $ 58,311 February 28, 2023 February 28, 2022 February 28, 2021 Automotive Electronics Beginning of period $ 10,425 $ 11,778 $ 8,467 Goodwill acquired (see Note 2) — — 3,290 Adjustments to goodwill acquired, net (see Note 2) — ( 1,353 ) 21 Impairment charge ( 7,373 ) — — End of period $ 3,052 $ 10,425 $ 11,778 Gross carrying value $ 10,425 $ 10,425 $ 11,778 Accumulated impairment charge ( 7,373 ) — — Net carrying value $ 3,052 $ 10,425 $ 11,778 Consumer Electronics Beginning of period $ 63,895 $ 46,533 $ 46,533 Goodwill acquired (see Note 2) - 18,160 - Adjustments to goodwill acquired (see Note 2) 1,051 - - Foreign currency translation ( 2,690 ) ( 798 ) — End of period $ 62,256 $ 63,895 $ 46,533 Gross carrying value $ 94,419 $ 96,058 $ 78,696 Accumulated impairment charge ( 32,163 ) ( 32,163 ) ( 32,163 ) Net carrying value $ 62,256 $ 63,895 $ 46,533 Total goodwill, net $ 65,308 $ 74,320 $ 58,311 Note: The Company's Biometrics segment did not carry a balance for goodwill at February 28, 2023, February 28, 2022, or February 28, 2021 . Intangible Assets At February 28, 2023 and February 28, 2022, intangible assets consisted of the following: February 28, 2023 Gross Accumulated Total Net Finite-lived intangible assets: Customer relationships ( 10 - 15.5 years) $ 53,790 $ 42,786 $ 11,004 Trademarks/Tradenames ( 5.5 - 10 years) 21,205 3,360 17,845 Developed technology ( 7 - 10 years) 19,434 14,645 4,789 Patents ( 7 - 13 years) 6,736 5,845 891 License 1,400 1,400 - Contracts 1,556 1,556 - Total finite-lived intangible assets $ 104,121 $ 69,592 34,529 Indefinite-lived intangible assets Trademarks 55,908 Total intangible assets, net $ 90,437 February 28, 2022 Gross Accumulated Total Net Finite-lived intangible assets: Customer relationships ( 4 - 15.5 years) $ 54,138 $ 39,669 $ 14,469 Trademarks/Tradenames ( 5.5 - 10 years) 17,466 1,927 15,539 Developed technology ( 7 years) 20,413 13,179 7,234 Patents ( 4 - 13 years) 6,736 5,562 1,174 License 1,400 1,400 - Contracts 1,556 1,556 - Total finite-lived intangible assets $ 101,709 $ 63,293 38,416 Indefinite-lived intangible assets Trademarks 63,034 Total intangible assets, net $ 101,450 The Company expenses the renewal costs of patents as incurred. The weighted-average period before the renewal of our patents is approximately 4 years. Amortization expense for intangible assets amounted to $ 6,848 , $ 6,508 , and $ 5,426 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 , respectively. At February 28, 2023, the estimated aggregate amortization expense for all amortizable intangibles for each of the succeeding five fiscal years is as follows: Fiscal Year Amount 2024 $ 6,215 2025 5,948 2026 5,848 2027 3,616 2028 3,144 |
Sales Incentives | l) Sales Incentives The Company offers sales incentives to its customers in the form of (1) co-operative advertising allowances; (2) market development funds; (3) volume incentive rebates; and (4) other trade allowances. The Company accounts for sales incentives in accordance with ASC 606 "Revenue from Contracts with Customers" ("ASC 606"). These sales incentives represent variable consideration provided to customers. Depending on the specific facts and circumstances, we utilize either the most likely amount or expected value methods to estimate the effect of uncertainty on the amount of variable consideration to which we would be entitled. The most likely amount method considers the single most likely amount from a range of possible consideration amounts, while the expected value method is the sum of the probability-weighted amounts in a range of possible consideration amounts. Both methods are based upon the contractual terms of the incentives and historical experience with each customer. Except for other trade allowances, all sales incentives require the customer to purchase the Company's products during a specified period of time. All sales incentives require customers to claim the sales incentive within a certain time period (referred to as the "claim period") and claims are settled either by the customer claiming a deduction against an outstanding account receivable or by the customer requesting a cash payout. All costs associated with sales incentives are classified as a reduction of net sales. The following is a summary of the various sales incentive programs: Co-operative advertising allowances are offered to customers as reimbursement towards their costs for print or media advertising in which the Company’s product is featured on its own or in conjunction with other companies' products. The amount offered is either a fixed amount or is based upon a fixed percentage of sales revenue or a fixed amount per unit sold to the customer during a specified time period. Market development funds are offered to customers in connection with new product launches or entrance into new markets. The amount offered for new product launches is based upon a fixed amount or based upon a percentage of sales revenue or a fixed amount per unit sold to the customer during a specified time period. Volume incentive rebates offered to customers require minimum quantities of product to be purchased during a specified period of time. The amount offered is either based upon a fixed percentage of sales revenue to the customer or a fixed amount per unit sold to the customer. The Company makes an estimate of the ultimate amount of the rebate their customers will earn based upon past history with the customers and other facts and circumstances. The Company has the ability to estimate these volume incentive rebates, as the period of time for a particular rebate to be claimed is relatively short. Any changes in the estimated amount of volume incentive rebates are recognized immediately using a cumulative catch-up adjustment. The Company accrues the cost of co-operative advertising allowances, volume incentive rebates and market development funds at the later of when the customer purchases our products or when the sales incentive is offered to the customer. Unearned sales incentives are volume incentive rebates where the customer did not purchase the required minimum quantities of product during the specified time. Volume incentive rebates are reversed into income in the period when the customer did not reach the required minimum purchases of product during the specified time. Unclaimed sales incentives are sales incentives earned by the customer, but the customer has not claimed payment within the claim period (period after program has ended). Unclaimed sales incentives are investigated in a timely manner after the end of the program and reversed if deemed appropriate. The Company believes the reversal of earned but unclaimed sales incentives upon the expiration of the claim period is a systematic, rational, consistent, and conservative method of reversing unclaimed sales incentives. Other trade allowances are additional sales incentives the Company provides to customers subsequent to the related revenue being recognized. The Company records the provision for these additional sales incentives at the later of when the sales incentive is offered or when the related revenue is recognized. Such additional sales incentives are based upon a fixed percentage of the selling price to the customer, a fixed amount per unit, or a lump-sum amount. Although the Company makes its best estimate of its sales incentive liability, many factors, including significant unanticipated changes in the purchasing volume of its customers and the lack of claims made by customers, could have a significant impact on the sales incentives liability and reported operating results. A summary of the activity with respect to accrued sales incentives is provided below: Year Year Year February 28, February 28, February 28, Accrued sales incentives, opening balance $ 23,755 $ 25,313 $ 12,250 Accruals 50,056 58,490 67,337 Payments and credits ( 51,894 ) ( 59,644 ) ( 54,102 ) Reversals for unearned sales incentives ( 139 ) ( 404 ) ( 172 ) Accrued sales incentives, ending balance $ 21,778 $ 23,755 $ 25,313 The majority of the reversals of previously established sales incentive liabilities pertain to sales recorded in prior periods. |
Advertising | m) Advertising Excluding co-operative advertising as discussed in Note 1(l) above, the Company expensed the cost of advertising, as incurred, of $ 5,448 , $ 5,376 , and $ 4,605 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021 , respectively. |
Research and Development | n) Research and Development Expenditures for research and development are charged to expense as incurred. Such expenditures amounted to $ 9,419 , $ 12,115 , and $ 7,940 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively, net of customer reimbursement, of $ 936 , $ 58 , and $ 120 , respectively, and are included within Engineering and Technical Support expenses on the Consolidated Statements of Operations and Comprehensive (Loss) Income . Reimbursements from OEM customers for development services are reflected as a reduction of research and development expense because the performance of contract development services is not central to the Company's operations. The increases in customer reimbursements for the year ended February 28, 2023 were a result of higher reimbursements from certain OEM customers in the Automotive Electronics segment, as well as a reimbursement from one customer in the Biometrics segment. |
Product Warranties and Product Repair Costs | o) Product Warranties and Product Repair Costs The Company generally warranties its products against certain manufacturing and other defects. This warranty does not provide a service beyond assuring that the products comply with agreed-upon specifications and is not sold separately. The Company provides warranties for all of its products ranging primarily from 30 days to 3 years. The Company also provides limited lifetime warranties for certain products, which limit the end user's remedy to the repair or replacement of the defective product during its lifetime, as well as for certain vehicle security products for the life of the vehicle for the original owner. Warranty expenses are accrued at the time the related revenue is recognized, based on the Company's estimated cost to repair, or replace expected product returns for warranty matters. This liability is based primarily on historical experiences of actual warranty claims as well as current information on repair costs and contract terms with certain manufacturers. The warranty liability of $ 5,845 and $ 4,470 is recorded in Accrued expenses and other current liabilities in the accompanying Consolidated Balance Sheets as of February 28, 2023 and February 28, 2022, respectively. In addition, the Company records a reserve for product repair or replace costs which is based upon the quantities of defective inventory on hand and an estimate of the cost to repair such defective inventory. The reserve for product repair costs of $ 914 and $ 1,152 is recorded as a reduction to inventory in the accompanying Consolidated Balance Sheets as of February 28, 2023 and February 28, 2022, respectively. Warranty claims and product repair costs expense for the years ended February 28, 2023, February 28, 2022 and February 28, 2021 were $ 6,525 , $ 4,583 , and $ 3,065 , respectively. Changes in the Company's accrued product warranties and product repair costs are as follows: Year Year Year February 28, February 28, February 28, Beginning balance $ 5,622 $ 5,290 $ 4,748 Liabilities (adjusted) acquired during acquisitions - ( 352 ) 1,200 Accrual for warranties issued during the year and repair cost 6,525 4,583 3,065 Warranty claims settled during the year ( 5,388 ) ( 3,899 ) ( 3,723 ) Ending balance $ 6,759 $ 5,622 $ 5,290 |
Foreign Currency | p) Foreign Currency Assets and liabilities of subsidiaries located outside the United States whose cash flows are primarily in local currencies have been translated at rates of exchange at the end of the period or historical exchange rates, as appropriate in accordance with ASC 830, "Foreign Currency Matters" ("ASC 830"). Revenues and expenses have been translated at the weighted-average rates of exchange in effect during the period. Gains and losses resulting from translation are recorded in the cumulative foreign currency translation account in Accumulated other comprehensive loss. For the years ended February 28, 2023, February 28, 2022 and February 28, 2021, the Company recorded total net foreign currency transaction (losses) gains in the amount of $( 3,674 ) , $( 635 ) and $( 862 ) , respectively. Foreign currency losses for the year ended February 28, 2023 were primarily driven by declines in the Japanese Yen, which impacted the remeasurement of the Company's Onkyo subsidiary intercompany loans and interest payable, which are not of a long-term investment nature. |
Income Taxes | q) Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. In evaluating our ability to recover our deferred tax assets within the jurisdiction from which they arise, we consider all positive and negative evidence including the results of recent operations, scheduled reversal of deferred tax liabilities, future taxable income, and tax planning strategies. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled (see Note 8). The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company made a policy election to treat the income tax with respect to GILTI as a period expense when incurred. Uncertain Tax Positions The Company adopted guidance included in ASC 740 as it relates to uncertain tax positions. The guidance addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure requirements. Tax interest and penalties The Company classifies interest and penalties associated with income taxes as a component of Income tax expense (benefit) on the Consolidated Statements of Operations and Comprehensive (Loss) Income . |
Uncertain Tax Positions | Uncertain Tax Positions The Company adopted guidance included in ASC 740 as it relates to uncertain tax positions. The guidance addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under ASC 740, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods and disclosure requirements. |
Net (Loss) Income Per Common Share | r) Net (Loss) Income Per Common Share Basic net (loss) income per common share attributable to VOXX International Corporation is calculated by dividing net income attributable to Voxx, adjusted to reflect changes in the redemption value of redeemable non-controlling interest, by the weighted-average number of common shares outstanding during the period. Diluted net (loss) income per common share reflects the potential dilution that would occur if common stock equivalent securities or other contracts to issue common stock were exercised or converted into common stock. No redemption value adjustment was made to the redeemable non-controlling interest for the years ended February 28, 2023, February 28, 2022, or February 28, 2021. A reconciliation between the denominator of basic and diluted net (loss) income per common share is as follows: Year Year Year February 28, February 28, February 28, Weighted-average common shares outstanding (basic) 24,325,938 24,287,179 24,201,221 Effect of dilutive securities: Restricted stock units, market stock units, and stock grants - - 448,885 Weighted-average common and potential common shares outstanding (diluted) 24,325,938 24,287,179 24,650,106 Restricted stock units, market stock units, and stock grants totaling 378,454 , 737,513 and 12,757 for the years ended February 28, 2023, February 28, 2022 and February 28, 2021, respectively, were not included in the net (loss) income per common share calculation because the settlement price of the restricted stock units, market stock units, and stock grants was greater than the average market price of the Company's common stock during these periods, or because the inclusion of these components would have been anti-dilutive. |
Other (Expense) Income | s) Other (Expense) Income Other (expense) income is comprised of the following: Year Year Year February 28, February 28, February 28, Foreign currency (loss) gain $ ( 3,674 ) $ ( 635 ) $ ( 862 ) Interest income 36 72 83 Rental income 911 678 739 Miscellaneous 672 208 786 Total other, net $ ( 2,055 ) $ 323 $ 746 Foreign currency losses included within Foreign currency (loss) gain, net, for the year ended February 28, 2023 were primarily driven by declines in the Japanese Yen, which impacted the re-measurement of the Company's Onkyo subsidiary intercompany loans and interest payable, which are not of a long-term investment nature. The total foreign currency loss attributable to these re-measurements for the year ended February 28, 2023 was $ 3,267 . Interest income for the years ended February 28, 2023 and February 28, 2022 decreased as compared to the year ended February 28, 2021 as a result of a lower balance of money market funds available to invest. |
Accounting for the Impairment of Long-Lived Assets | t) Accounting for the Impairment of Long-Lived Assets Long-lived assets and certain identifiable intangible assets are reviewed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying value of an asset to future undiscounted net cash flows expected to be generated by the asset. Recoverability of long-lived assets is measured by comparing the carrying value of the assets to their estimated fair market value. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying value of the assets exceeds the fair value of the assets. See Note 1(k) for discussion of the impairment of goodwill and intangible assets in connection with the Company’s annual impairment testing for the years ended February 28, 2023 and February 28, 2021. There were no impairments of definitely-lived intangible assets or long-lived assets recorded in accordance with ASC 360 during the years ended February 28, 2023, February 28, 2022 and February 28, 2021 . |
Accounting for Stock-Based Compensation | u) Accounting for Stock-Based Compensation The Company has a stock-based compensation plan under which employees and non-employee directors may be granted incentive stock options ("ISO's") and non-qualified stock options ("NQSO's") to purchase shares of Class A common stock. Under the plan, the exercise price of the ISO's granted to a ten percent stockholder must equal 110 % of the fair market value of the Company's Class A common stock on the date of grant. The exercise price of all other options and Stock Appreciation Right ("SAR") awards may not be less than 100 % of the fair market value of the Company's Class A common stock on the date of grant. If an option or SAR is granted pursuant to an assumption of, or substitution for, another option or SAR pursuant to a Corporate Transaction, and in a manner consistent with Section 409A of the Internal Revenue Code (the “Code”), the exercise or strike price may be less than 100 % of the fair market value on the date of grant. The plan permits for options to be exercised at various intervals as determined by the Board of Directors. However, the maximum expiration period is ten years from date of grant. The vesting requirements are determined by the Board of Directors at the time of grant. Exercised options are issued from authorized Class A common stock. As of February 28, 2023, approximately 1,049,275 shares were available for future grants under the terms of these plans. Options are measured at the fair value of the award at the date of grant and are recognized as an expense over the requisite service period. Compensation expense related to stock-based awards with vesting terms are amortized using the straight-line attribution method. There were no stock options granted during the years ended February 28, 2023, February 28, 2022, or February 28, 2021. During the years ended February 28, 2023, February 28, 2022, and February 28, 2021 there were no stock-based compensation costs or professional fees recorded by the Company and the Company had no unrecognized compensation costs at February 28, 2023 related to stock options and warrants. Restricted stock awards are granted pursuant to the Company’s 2012 Equity Incentive Plan (the “2012 Plan”). A restricted stock award is an award of common stock that is subject to certain restrictions during a specified period. Restricted stock awards are independent of option grants and are subject to forfeiture if employment terminates for a reason other than death, disability, or retirement prior to the release of the restrictions. Shares under restricted stock grants are not issued to the grantees before they vest. The Company’s Omnibus Equity Incentive Plan was established in 2014 (the “2014 Plan”). Pursuant to the 2014 Plan, Restricted Stock Units (“RSU’s”) may be awarded by the Company to any individual who is employed by, provides services to, or serves as a director of, the Company or its affiliates. RSU’s are granted based on certain performance criteria and vest on the later of three years from the date of grant, or the grantee reaching the age of 65 years. The shares will also vest upon termination of the grantee's employment by the Company without cause, provided that the grantee, at the time of termination, has been employed by the Company for at least 10 years, or as a result of the sale of all of the issued and outstanding stock, or all, or substantially all, of the assets of the subsidiary of which the grantee serves as CEO and/or President. When vested shares are issued to the grantee, the awards will be settled in shares or in cash, at the Company's sole option. The grantees cannot transfer the rights to receive shares before the restricted shares vest. There are no market conditions inherent in the award, only an employee performance requirement, and the service requirement that the respective employee continues employment with the Company through the vesting date. The Company expenses the cost of the RSU’s on a straight-line basis over the requisite service period of each employee. During the years ended February 28, 2023, February 28, 2022, and February 28, 2021, an additional 46,556 , 48,527 , and 48,269 RSU’s were granted under the 2014 Plan, respectively. The fair market value of the RSU’s, $ 8.28 , $ 13.59 , and 5.76 for Fiscal 2023, Fiscal 2022, and Fiscal 2021, respectively, were determined based on the mean of the high and low price of the Company's common stock on the grant dates. Grant of Shares to Chief Executive Officer On July 8, 2019, the Board of Directors approved a five-year Employment Agreement (the “Employment Agreement”), effective March 1, 2019, by and between the Company and Patrick M. Lavelle, the Company’s Chief Executive Officer. Under the terms of the Employment Agreement, in addition to a $ 1,000 yearly salary and a cash bonus based on the Company’s Adjusted EBITDA, Mr. Lavelle was granted the right to receive certain stock-based compensation as discussed below: - An initial stock grant of 200,000 fully vested shares of Class A Common Stock issued in July 2019 under the 2012 Plan. - Additional stock grants of 100,000 shares of Class A Common Stock to be issued on each of March 1, 2020, March 1, 2021, and March 1, 2022 under the 2012 Plan. Compensation expense of $ 157 and $ 409 was recognized during the years ended February 28, 2022, and February 28, 2021 , respectively, based upon the grant fair value of $ 4.15 per share using the graded vesting attribution method. For the year ended February 28, 2023, there was no remaining compensation expense recognized related to these awards. On March 1, 2020, 100,000 of these stock grants vested, resulting in 100,000 shares of the Company’s Class A Common Stock being issued to Mr. Lavelle. On March 1, 2021, an additional 100,000 of these stock grants vested, resulting in 60,653 shares of Class A Common Stock being issued to Mr. Lavelle and 39,347 shares being withheld for taxes. On March 1, 2022, the final 100,000 of these stock grants vested, resulting in 61,337 shares of Class A Common Stock being issued to Mr. Lavelle and 38,663 shares being withheld for taxes. - Grant of market stock units (“MSU’s”) up to a maximum value of $ 5,000 , based upon the achievement of a 90-calendar day average stock price of no less than $ 5.49 over the performance period ending on the third and fifth anniversary of the effective date of the Employment Agreement. The value of the MSU award increases based upon predetermined targeted 90-calendar day average stock prices with a maximum of $ 5,000 if the 90-calendar day average high stock price equals or exceeds $ 15.00 . The average stock price is calculated based on the highest average closing price of one share of our Class A common stock, as reported on the NASDAQ Stock Market during any 90-calendar day period prior to each measurement date. The number of shares to be issued under the 2012 Plan related to the MSUs based upon achievement of the maximum award value of $ 5,000 , and if issued at $ 15.00 per share, is estimated at 333,333 shares. The award may be settled in shares or in cash upon mutual agreement between the Company and Mr. Lavelle. Actual results may differ based upon when the high average stock price is achieved and settled. The Company used a Monte Carlo simulation to calculate the fair value of the award on the grant date. A Monte Carlo simulation requires the use of various assumptions, including the stock price volatility and risk-free interest rate as of the valuation date. We recognized stock-based compensation expense of $ 91 , $ 241 , and $ 241 for the years ended February 28, 2023, February 28, 2022, and February 28, 2021, respectively, related to these MSU’s using the graded vesting attribution method over the performance period. On March 1, 2022, 80 % of this MSU award vested and was settled in cash, resulting in a payment made to Mr. Lavelle in the amount of $ 4,000 during the year ended February 28, 2023. As of February 28, 2023 , 20 % of the MSU’s remain outstanding. All stock grants under the Employment Agreement are subject to a hold requirement as specified in the Employment Agreement. The Employment Agreement gave Mr. Lavelle, in certain limited change of control situations, the right to require the Company to purchase the shares in connection with the Employment Agreement, shares personally acquired by Mr. Lavelle, and shares issued to him under other incentive compensation arrangements. Accordingly, the stock awards issued in connection with the Employment Agreement are presented as redeemable equity on the consolidated balance sheet at grant-date fair value. Shares previously held by Mr. Lavelle under the 2014 Plan and those personally purchased by Mr. Lavelle have been reclassified from permanent equity to redeemable equity. As the contingent events that would allow Mr. Lavelle to redeem the shares are not probable at this time, remeasurement of the amounts in redeemable equity have not been recorded. The Employment Agreement contains certain restrictive and non-solicitation covenants. Grant of Shares to President On February 6, 2023, Voxx appointed Beat Kahli, the Company’s largest shareholder, President of the Company. The Company entered into an employment agreement with Mr. Kahli effective February 6, 2023 with a term ending on February 29, 2024. Under the terms of the employment agreement, in addition to a $ 300 yearly salary, Mr. Kahli was granted the right to receive stock-based compensation in the form of a stock grant of 20,000 shares of the Company's Class A Common Stock to be issued on each of June 30, 2023, September 30, 2023, December 31, 2023 and March 31, 2024. T he grant fair value of these shares was $ 10.66 per share and compensation expense is recorded using the graded vesting attribution method. The following table presents a summary of the activity related to the 2014 Plan and the initial stock grant and additional stock grants under the Employment Agreement for the year ended February 28, 2023: Number of shares Weighted Average Unvested share balance at February 29, 2020 715,152 $ 5.07 Granted 88,269 7.18 Vested ( 99,697 ) 7.21 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2021 603,724 $ 5.18 Granted 48,527 13.59 Vested ( 197,891 ) 5.76 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2022 354,360 $ 6.30 Granted 66,556 9.00 Vested ( 33,930 ) 6.10 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2023 286,986 $ 7.70 At February 28, 2023, there were 501,505 shares of vested and unissued shares under the 2014 Plan with a weighted average fair value of $ 6.79 . During the years ended February 28, 2023 and February 28, 2021, vested RSU awards for former employees of the Company, totaling 8,634 and 105,123 award units, respectively, were settled in cash in amounts totaling $ 81 and $ 575 , respectively. During the year ended February 28, 2022, no RSU awards were settled in cash. During the years ended February 28, 2023, February 28, 2022 and February 28, 2021 the Company recorded $ 609 , $ 907 , and $ 1,749 , respectively, in stock-based compensation related to the 2014 Plan, and the initial stock grant, additional stock grants, and MSU’s under the Employment Agreement. As of February 28, 2023, unrecognized stock-based compensation expense related to unvested RSU’s was approximately $ 1,270 and will be recognized over the requisite service period of each employee. |
Accumulated Other Comprehensive Loss | v) Accumulated Other Comprehensive Loss Foreign Pension plan Derivatives Total Balance at February 29, 2020 $ ( 17,739 ) $ ( 887 ) $ ( 429 ) $ ( 19,055 ) Other comprehensive income (loss) before reclassifications 4,365 18 ( 470 ) 3,913 Reclassified from accumulated other comprehensive loss — — 165 165 Net current-period other comprehensive income (loss) 4,365 18 ( 305 ) 4,078 Balance at February 28, 2021 $ ( 13,374 ) $ ( 869 ) $ ( 734 ) $ ( 14,977 ) Other comprehensive (loss) income before reclassifications ( 3,317 ) 158 485 ( 2,674 ) Reclassified from accumulated other comprehensive loss - - 148 148 Net current-period other comprehensive (loss) income ( 3,317 ) 158 633 ( 2,526 ) Balance at February 28, 2022 $ ( 16,691 ) $ ( 711 ) $ ( 101 ) $ ( 17,503 ) Other comprehensive (loss) income before reclassifications ( 1,876 ) 390 352 ( 1,134 ) Reclassified from accumulated other comprehensive loss - - ( 43 ) ( 43 ) Net current-period other comprehensive (loss) income ( 1,876 ) 390 309 ( 1,177 ) Balance at February 28, 2023 $ ( 18,567 ) $ ( 321 ) $ 208 $ ( 18,680 ) During the years ended February 28, 2023, February 28, 2022 and February 28, 2021, the Company recorded other comprehensive income (loss), net of associated tax impact of $ 171 , $( 40 ) and $( 74 ) , respectively, related to pension plan adjustments, and $ 20 , $( 101 ) and $ 106 , respectively, related to derivatives designated in a hedging relationship. The other comprehensive (loss) income before reclassification for foreign currency translation of $ ( 1,876 ) , $ ( 3,317 ) , and $ 4,365 , respectively, includes the remeasurement of intercompany transactions of a long term investment nature of $ 1,639 , $ 320 and $( 1,244 ) , respectively, with certain subsidiaries whose functional currency is not the U.S. dollar, and $( 3,515 ) , $( 3,637 ) and $ 5,609 , respectively, from translating the financial statements of the Company's non-U.S. dollar functional currency subsidiaries into our reporting currency, which is the U.S. dollar. Intercompany loans and transactions that are of a long-term investment nature are remeasured and resulting gains and losses shall be reported in the same manner as translation adjustments. Within foreign currency translation (losses) gains in Other comprehensive (loss) income for the years ended February 28, 2023, February 28, 2022 and February 28, 2021, the Company recorded total (losses) gains of $( 1,660 ) , $( 2,728 ) , and $ 4,136 , respectively, related to the Euro; $( 193 ) , $( 245 ) , and $ 261 , respectively, related to the Canadian Dollar; $ 57 , $ 25 and $( 53 ) , respectively, for the Mexican Peso, as well as $ 92 , $( 120 ) and $ 21 , respectively, for various other currencies. For the years ended February 28, 2023 and February 28, 2022, Other comprehensive (loss) income also included foreign currency (losses) gains of $( 173 ) and $( 249 ) from the Japanese Yen, generated by the Company’s Onkyo subsidiary, which was established in September 2021 and was not present in all previous fiscal years presented. These adjustments were caused by the strengthening/(weakening) of the U.S. Dollar against the Euro, Canadian Dollar, Mexican Peso, and the Japanese Yen between - 10 % and 19 % in Fiscal 2023, - 2 % and 8 % in Fiscal 2022, and - 10 % and 6 % in Fiscal 2021 . |
New Accounting Pronouncements | w) New Accounting Pronouncements In March 2020 and January 2021, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting” and ASU No. 2021-01, “Reference Rate Reform: Scope,” respectively. Together, these ASU’s provide optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2020-04 provides, among other things, guidance that modifications of contracts within the scope of Topic 470, Debt, should be accounted for by prospectively adjusting the effective interest rate; modifications of contracts within the scope of Topic 840, Leases, should be accounted for as a continuation of the existing contract; and, changes in the critical terms of hedging relationships caused by reference rate reform should not result in the de-designation of the instrument, provided certain criteria are met. ASU 2021-01 clarifies the scope and application of ASU 2020-04 and among other things, permits entities to elect certain optional expedients and exceptions when accounting for derivative contracts and certain hedging relationships affected by changes in the interest rates used for discounting cash flows. These optional expedients and exceptions are effective as of March 12, 2020 through December 31, 2024. The Company's Credit Facility with Wells Fargo transitioned to SOFR in conjunction with the amendment executed in February 2023 with no impact to the Company's consolidated financial statements (see Note 7). On May 1, 2023, VOXX HQ LLC, a wholly owned subsidiary of the Company, consented to a First Amendment to the Indenture of Trust relating to the Florida Industrial Revenue Bonds for the purpose of transitioning from a LIBOR based interest rate to a SOFR based interest rate (see Note 7). Effective May 3, 2023, VOXX HQ LLC entered into an Amended and Restated Confirmation of Swap Transaction with Wells Fargo Bank N.A. related to the interest rate swap that hedges the Company's interest rate exposure on the Florida Industrial Revenue Bonds. The swap contract was amended to reference SOFR, as well as set a new fixed rate equal to 3.43 %. In October 2021, the FASB issued ASU No. 2021-08, “Accounting for Contract Assets and Contract Liabilities from Contracts With Customers,” which amends the accounting for contract assets acquired and contract liabilities assumed from contracts with customers in business combinations (“acquired contract balances”). The update requires contract assets and contract liabilities from contracts with customers that are acquired in a business combination to be recognized and measured as if the acquirer had originated the original contract. Previously, acquired contract assets and liabilities were measured at fair value. The ASU is effective for fiscal years beginning after December 15, 2022. Early adoption is permitted. We do not expect the adoption to have a material impact on our consolidated financial statements. In June 2022, the FASB issued ASU No. 2022-03, "Fair Value Measurements (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions," which clarifies and amends the guidance of measuring the fair value of equity securities subject to contractual restrictions that prohibit the sale of the equity securities. The guidance will be effective for fiscal years beginning after December 15, 2023 and interim periods within those fiscal years. We do not expect the adoption to have a material impact on our consolidated financial statements. In March 2023, the FASB issued ASU No. 2023-01, "Leases (Topic 842): Common Control Arrangements." The amendment clarifies the accounting for leasehold improvements associated with common control leases, by requiring that leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group (regardless of the lease term) as long as the lessee controls the use of the underlying asset through a lease. Additionally, leasehold improvements associated with common control leases should be accounted for as a transfer between entities under common control through an adjustment to equity if, and when, the lessee no longer controls the use of the underlying asset. The guidance will be effective for annual and interim periods beginning after December 15, 2023. We do not expect the adoption to have a material impact on our consolidated financial statements. In March 2023, the FASB issued ASU No. 2023-02, "Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investment Tax Credit Structures Using the Proportional Amortization Method." The amendments in this update permit reporting entities to elect to account for their tax equity investments, regardless of the tax credit program from which the income tax credits are received, using the proportional amortization method if certain conditions are met. This guidance will be effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The Company is currently evaluating the impact this update may have on its consolidated financial statements. |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
Assets and Liabilities Measured on Recurring Basis | The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2023: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 6,134 $ 6,134 $ — $ — Mutual funds 1,053 1,053 - - Derivatives designated for hedging 207 - 207 - Liabilities: Contingent consideration $ 4,500 $ — $ — $ 4,500 The following table presents assets and liabilities measured at fair value on a recurring basis at February 28, 2022: Fair Value Measurements at Total Level 1 Level 2 Level 3 Assets: Cash and money market funds $ 27,788 $ 27,788 $ — $ — Mutual funds 1,231 1,231 - - Liabilities: Derivatives designated for hedging $ 188 $ — $ 188 $ — Contingent consideration 6,435 - - 6,435 |
Company's Contingent Consideration Balance | The following table provides a rollforward of the Company's contingent consideration balance for the year ended February 28, 2023: Balance at February 28, 2022 $ 6,435 Payments ( 1,620 ) Fair value adjustment 50 Purchase price allocation adjustment 1,051 Gain on settlement ( 443 ) Foreign currency translation ( 973 ) Balance at February 28, 2023 $ 4,500 |
Fair Value, by Balance Sheet Grouping | The Company holds derivative instruments that are designated as hedging instruments. The following table discloses the fair value as of February 28, 2023 and February 28, 2022 for derivative instruments: Derivative Assets and Liabilities Fair Value Account February 28, 2023 February 28, 2022 Designated derivative instruments Interest rate swap Other assets $ 207 $ - Other long-term liabilities - ( 188 ) Total derivatives $ 207 $ ( 188 ) |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | Activity related to cash flow hedges recorded during the twelve months ended February 28, 2023 and February 28, 2022 was as follows: February 28, 2023 February 28, 2022 Gain Loss Gain Loss Cash flow hedges Foreign currency contracts $ - $ 63 $ 233 $ ( 307 ) Interest rate swaps $ 395 $ — $ 258 $ — |
Summary of Investment Securities | As of February 28, 2023 and February 28, 2022, the Company had the following investments: February 28, 2023 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,053 Total Marketable Equity Securities 1,053 Total Investment Securities $ 1,053 February 28, 2022 Carrying Value Investment Securities Marketable Equity Securities Mutual funds $ 1,231 Total Marketable Equity Securities 1,231 Total Investment Securities $ 1,231 |
Schedule of Accounts Receivable | Accounts receivable are comprised of the following: February 28, February 28, Trade accounts receivable $ 85,268 $ 108,915 Less: Allowance for credit losses 1,398 2,182 Allowance for cash discounts 1,117 1,108 $ 82,753 $ 105,625 |
Schedule of Inventory, Current | Inventories by major category are as follows: February 28, February 28, Raw materials $ 28,048 $ 23,904 Work in process 1,363 1,519 Finished goods 145,718 149,499 Inventory, net $ 175,129 $ 174,922 |
Summary of Property, Plant and Equipment, Net | A summary of property, plant and equipment, net, is as follows: February 28, February 28, Land $ 7,101 $ 7,046 Buildings 44,669 44,177 Property under finance lease 2,754 2,503 Furniture and fixtures 4,600 4,489 Machinery and equipment 10,514 10,287 Construction-in-progress 748 3,341 Computer hardware and software 46,313 41,962 Automobiles 681 710 Leasehold improvements 3,008 2,718 120,388 117,233 Less accumulated depreciation and amortization 73,344 67,439 $ 47,044 $ 49,794 |
Summary of Estimated Useful Lives of Assets | Depreciation is calculated on the straight-line method over the estimated useful lives of the assets as follows: Buildings and improvements 20 - 40 years Furniture and fixtures 5 - 15 years Machinery and equipment 5 - 15 years Computer hardware and software 3 - 5 years Automobiles 3 years |
Change in Carrying Value of Goodwill | The change in the carrying value of goodwill is as follows: February 28, 2023 February 28, 2022 February 28, 2021 Beginning of period $ 74,320 $ 58,311 $ 55,000 Goodwill acquired (see Note 2) — 18,160 3,290 Adjustments to goodwill acquired, net (see Note 2) 1,051 ( 1,353 ) 21 Impairment charge ( 7,373 ) — — Foreign currency translation ( 2,690 ) ( 798 ) — End of period $ 65,308 $ 74,320 $ 58,311 Gross carrying value $ 104,844 $ 106,483 $ 90,474 Accumulated impairment charges ( 39,536 ) ( 32,163 ) ( 32,163 ) Net carrying value $ 65,308 $ 74,320 $ 58,311 February 28, 2023 February 28, 2022 February 28, 2021 Automotive Electronics Beginning of period $ 10,425 $ 11,778 $ 8,467 Goodwill acquired (see Note 2) — — 3,290 Adjustments to goodwill acquired, net (see Note 2) — ( 1,353 ) 21 Impairment charge ( 7,373 ) — — End of period $ 3,052 $ 10,425 $ 11,778 Gross carrying value $ 10,425 $ 10,425 $ 11,778 Accumulated impairment charge ( 7,373 ) — — Net carrying value $ 3,052 $ 10,425 $ 11,778 Consumer Electronics Beginning of period $ 63,895 $ 46,533 $ 46,533 Goodwill acquired (see Note 2) - 18,160 - Adjustments to goodwill acquired (see Note 2) 1,051 - - Foreign currency translation ( 2,690 ) ( 798 ) — End of period $ 62,256 $ 63,895 $ 46,533 Gross carrying value $ 94,419 $ 96,058 $ 78,696 Accumulated impairment charge ( 32,163 ) ( 32,163 ) ( 32,163 ) Net carrying value $ 62,256 $ 63,895 $ 46,533 Total goodwill, net $ 65,308 $ 74,320 $ 58,311 Note: The Company's Biometrics segment did not carry a balance for goodwill at February 28, 2023, February 28, 2022, or February 28, 2021 . |
Schedule of Intangible Assets, Excluding Goodwill | At February 28, 2023 and February 28, 2022, intangible assets consisted of the following: February 28, 2023 Gross Accumulated Total Net Finite-lived intangible assets: Customer relationships ( 10 - 15.5 years) $ 53,790 $ 42,786 $ 11,004 Trademarks/Tradenames ( 5.5 - 10 years) 21,205 3,360 17,845 Developed technology ( 7 - 10 years) 19,434 14,645 4,789 Patents ( 7 - 13 years) 6,736 5,845 891 License 1,400 1,400 - Contracts 1,556 1,556 - Total finite-lived intangible assets $ 104,121 $ 69,592 34,529 Indefinite-lived intangible assets Trademarks 55,908 Total intangible assets, net $ 90,437 February 28, 2022 Gross Accumulated Total Net Finite-lived intangible assets: Customer relationships ( 4 - 15.5 years) $ 54,138 $ 39,669 $ 14,469 Trademarks/Tradenames ( 5.5 - 10 years) 17,466 1,927 15,539 Developed technology ( 7 years) 20,413 13,179 7,234 Patents ( 4 - 13 years) 6,736 5,562 1,174 License 1,400 1,400 - Contracts 1,556 1,556 - Total finite-lived intangible assets $ 101,709 $ 63,293 38,416 Indefinite-lived intangible assets Trademarks 63,034 Total intangible assets, net $ 101,450 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | At February 28, 2023, the estimated aggregate amortization expense for all amortizable intangibles for each of the succeeding five fiscal years is as follows: Fiscal Year Amount 2024 $ 6,215 2025 5,948 2026 5,848 2027 3,616 2028 3,144 |
Summary of Activity with Respect to Accrued Sales Incentives | A summary of the activity with respect to accrued sales incentives is provided below: Year Year Year February 28, February 28, February 28, Accrued sales incentives, opening balance $ 23,755 $ 25,313 $ 12,250 Accruals 50,056 58,490 67,337 Payments and credits ( 51,894 ) ( 59,644 ) ( 54,102 ) Reversals for unearned sales incentives ( 139 ) ( 404 ) ( 172 ) Accrued sales incentives, ending balance $ 21,778 $ 23,755 $ 25,313 |
Changes in Accrued Product Warranties and Product Repair Costs | Changes in the Company's accrued product warranties and product repair costs are as follows: Year Year Year February 28, February 28, February 28, Beginning balance $ 5,622 $ 5,290 $ 4,748 Liabilities (adjusted) acquired during acquisitions - ( 352 ) 1,200 Accrual for warranties issued during the year and repair cost 6,525 4,583 3,065 Warranty claims settled during the year ( 5,388 ) ( 3,899 ) ( 3,723 ) Ending balance $ 6,759 $ 5,622 $ 5,290 |
Reconciliation Between Denominator of Basic and Diluted Net Income (Loss) Per Common Share | A reconciliation between the denominator of basic and diluted net (loss) income per common share is as follows: Year Year Year February 28, February 28, February 28, Weighted-average common shares outstanding (basic) 24,325,938 24,287,179 24,201,221 Effect of dilutive securities: Restricted stock units, market stock units, and stock grants - - 448,885 Weighted-average common and potential common shares outstanding (diluted) 24,325,938 24,287,179 24,650,106 |
Schedule of Other Nonoperating (Expense) Income | Other (expense) income is comprised of the following: Year Year Year February 28, February 28, February 28, Foreign currency (loss) gain $ ( 3,674 ) $ ( 635 ) $ ( 862 ) Interest income 36 72 83 Rental income 911 678 739 Miscellaneous 672 208 786 Total other, net $ ( 2,055 ) $ 323 $ 746 |
Summary of Activity Related to 2014 Plan and Initial Stock Grant and Additional Stock Grants under Employment Agreement | The following table presents a summary of the activity related to the 2014 Plan and the initial stock grant and additional stock grants under the Employment Agreement for the year ended February 28, 2023: Number of shares Weighted Average Unvested share balance at February 29, 2020 715,152 $ 5.07 Granted 88,269 7.18 Vested ( 99,697 ) 7.21 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2021 603,724 $ 5.18 Granted 48,527 13.59 Vested ( 197,891 ) 5.76 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2022 354,360 $ 6.30 Granted 66,556 9.00 Vested ( 33,930 ) 6.10 Vested and settled ( 100,000 ) 4.15 Forfeited — — Unvested share balance at February 28, 2023 286,986 $ 7.70 |
Schedule of Accumulated Other Comprehensive Loss | v) Accumulated Other Comprehensive Loss Foreign Pension plan Derivatives Total Balance at February 29, 2020 $ ( 17,739 ) $ ( 887 ) $ ( 429 ) $ ( 19,055 ) Other comprehensive income (loss) before reclassifications 4,365 18 ( 470 ) 3,913 Reclassified from accumulated other comprehensive loss — — 165 165 Net current-period other comprehensive income (loss) 4,365 18 ( 305 ) 4,078 Balance at February 28, 2021 $ ( 13,374 ) $ ( 869 ) $ ( 734 ) $ ( 14,977 ) Other comprehensive (loss) income before reclassifications ( 3,317 ) 158 485 ( 2,674 ) Reclassified from accumulated other comprehensive loss - - 148 148 Net current-period other comprehensive (loss) income ( 3,317 ) 158 633 ( 2,526 ) Balance at February 28, 2022 $ ( 16,691 ) $ ( 711 ) $ ( 101 ) $ ( 17,503 ) Other comprehensive (loss) income before reclassifications ( 1,876 ) 390 352 ( 1,134 ) Reclassified from accumulated other comprehensive loss - - ( 43 ) ( 43 ) Net current-period other comprehensive (loss) income ( 1,876 ) 390 309 ( 1,177 ) Balance at February 28, 2023 $ ( 18,567 ) $ ( 321 ) $ 208 $ ( 18,680 ) |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Onkyo Home Entertainment Corporation [Member] | |
Summary of Allocation of Purchase Price for Fair Value of Assets Acquired and Liabilities Assumed | September 8, 2021 Measurement Period Adjustments September 8, 2021 (as adjusted) Purchase price: Cash paid $ 21,989 $ - $ 21,989 Assignment of notes and interest receivable 8,417 - 8,417 Fair value of contingent consideration 6,710 1,119 7,829 Total transaction consideration $ 37,116 $ 1,119 $ 38,235 Allocation: Intangible assets $ 26,929 $ ( 7,905 ) $ 19,024 Goodwill 10,187 9,024 19,211 Total assets acquired $ 37,116 $ 1,119 38,235 |
Summary of Amounts Assigned to Goodwill and Intangible Assets | The amounts assigned to goodwill and intangible assets for the acquisition are as follows: September 8, 2021 (as adjusted) Amortization Period (Years) Goodwill $ 19,211 N/A Tradenames 12,468 10 Technology 6,556 5 $ 38,235 |
Rollforward of the Redeemable Non-controlling Interest | The following table provides the rollforward of the redeemable non-controlling interest for the year ended February 28, 2023: Redeemable Non-controlling Interest Balance at February 28, 2022 $ 511 Net loss attributable to non-controlling interest ( 66 ) Comprehensive loss attributable to non-controlling interest ( 125 ) Foreign currency translation ( 88 ) Balance at February 28, 2023 $ 232 |
Directed LLC and Directed Electronics Canada Inc [Member] | |
Summary of Allocation of Purchase Price for Fair Value of Assets Acquired and Liabilities Assumed | The following summarizes the allocation of the purchase price based upon the fair value of the assets acquired and liabilities assumed at the date of acquisition: July 1, 2020 Measurement July 1, 2020 Assets acquired: Inventory $ 7,054 956 8,010 Accounts receivable 5,173 357 5,530 Other current assets 160 - 160 Property and equipment 2,815 - 2,815 Operating lease, right of use asset 1,771 - 1,771 Customer relationships 2,600 ( 100 ) 2,500 Trademarks 4,500 - 4,500 Patented technology 1,030 - 1,030 Goodwill 3,290 ( 1,690 ) 1,600 Total assets acquired $ 28,393 $ ( 477 ) $ 27,916 Liabilities assumed: Accounts payable 8,144 - 8,144 Accrued expenses 1,406 ( 136 ) 1,270 Contract liabilities 4,872 11 4,883 Warranty accrual 1,200 ( 352 ) 848 Operating lease liability 1,771 - 1,771 Total $ 17,393 $ ( 477 ) $ 16,916 Total purchase price $ 11,000 $ - $ 11,000 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) - Variable Interest Entity, Primary Beneficiary [Member] | 12 Months Ended |
Feb. 28, 2023 | |
Variable Interest Entity [Line Items] | |
Summary of Carrying Values of Assets and Liabilities Included in Consolidated Balance Sheets | The following table sets forth the carrying values of assets and liabilities of EyeLock LLC that were included on our Consolidated Balance Sheets as of February 28, 2023 and February 28, 2022: February 28, 2023 February 28, 2022 Assets Current assets: Cash and cash equivalents $ 158 $ 25 Accounts receivable, net 520 47 Inventory, net 1,836 2,028 Prepaid expenses and other current assets 93 245 Total current assets 2,607 2,345 Property, plant and equipment, net 9 39 Intangible assets, net 1,786 2,057 Other assets 8 59 Total assets $ 4,410 $ 4,500 Liabilities and Partners' Deficit Current liabilities: Accounts payable $ 864 $ 1,023 Interest payable to VOXX 14,803 13,099 Accrued expenses and other current liabilities 296 766 Due to VOXX 66,175 66,390 Total current liabilities 82,138 81,278 Prepaid ownership interest due to GalvanEyes LLC 7,317 2,451 Other long-term liabilities 1,200 1,200 Total liabilities 90,655 84,929 Commitments and contingencies Partners' deficit: Capital 41,416 41,416 Retained losses ( 127,661 ) ( 121,845 ) Total partners' deficit ( 86,245 ) ( 80,429 ) Total liabilities and partners' deficit $ 4,410 $ 4,500 |
Summary of Revenues and Expenses Included in Consolidated Statements of Operations and Comprehensive (Loss) Income | The following table sets forth the revenue and expenses of EyeLock LLC that were included in our Consolidated Statements of Operations and Comprehensive (Loss) Income for the years ended February 28, 2023, February 28, 2022, and February 28, 2021: Year Ended Year Ended Year Ended February 28, 2023 February 28, 2022 February 28, 2021 Net sales $ 1,046 $ 882 $ 836 Cost of sales 688 694 1,025 Gross profit 358 188 ( 189 ) Operating expenses: Selling 575 653 603 General and administrative 1,509 1,410 1,785 Engineering and technical support 2,355 5,817 4,674 Total operating expenses 4,439 7,880 7,062 Operating loss ( 4,081 ) ( 7,692 ) ( 7,251 ) Other (expense) income: Interest and bank charges ( 1,720 ) ( 1,662 ) ( 1,475 ) Other, net ( 15 ) — — Total other expense, net ( 1,735 ) ( 1,662 ) ( 1,475 ) Loss before income taxes ( 5,816 ) ( 9,354 ) ( 8,726 ) Income tax expense — — — Net loss $ ( 5,816 ) $ ( 9,354 ) $ ( 8,726 ) |
Equity Investment (Tables)
Equity Investment (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Equity Method Investment, Summarized Financial Information [Abstract] | |
Equity Method Investment, Summarized Financial Information | The following presents summary financial information of ASA. Such summary financial information has been provided herein based upon the individual significance of ASA to the consolidated financial information of the Company. February 28, 2023 February 28, 2022 Current assets $ 48,391 $ 46,202 Non-current assets 6,525 7,382 Liabilities 10,880 10,888 Members' equity 44,036 42,696 Twelve Months Twelve Months Twelve Months February 28, February 28, February 28, Net sales $ 104,997 $ 114,825 $ 95,866 Gross profit 25,671 27,517 24,124 Operating income 13,749 15,695 12,938 Net income 13,938 15,780 14,700 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Accrued Liabilities, Current [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following: February 28, February 28, Commissions $ 623 $ 934 Employee compensation 15,878 17,082 Professional fees and accrued settlements 1,526 1,620 Future warranty 5,845 4,470 Refund liability 5,181 5,469 Freight and duty 7,508 10,342 Royalties, advertising and other 5,295 14,057 Total accrued expenses and other current liabilities $ 41,856 $ 53,974 |
Financing Arrangements (Tables)
Financing Arrangements (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The Company has the following financing arrangements: February 28, February 28, Domestic credit facility (a) $ 29,000 $ — Florida mortgage (b) 6,115 6,614 Euro asset-based lending obligation - VOXX Germany (c) — 1,906 Shareholder loan payable to Sharp (d) 4,079 4,718 Total debt 39,194 13,238 Less: current portion of long-term debt 500 2,406 Long-term debt before debt issuance costs 38,694 10,832 Less: debt issuance costs 1,181 1,046 Total long-term debt $ 37,513 $ 9,786 a) Domestic Bank Obligations The Company has a senior secured credit facility (the “Credit Facility") with Wells Fargo Bank, N.A. (“Wells Fargo”), which was amended on February 15, 2023. The amended Credit Facility provides for an increase in the revolving credit facility with committed availability of up to $ 165,000 and also includes a $ 50,000 sublimit for letters of credit and a $ 15,000 sublimit for Swing Loans. The availability under the revolving credit line within the Credit Facility is subject to a borrowing base, which is based on eligible accounts receivable, eligible inventory and certain real estate, subject to reserves as determined by the lender, and is also limited by amounts outstanding under the Florida Mortgage (see Note 7(b)). The remaining availability under the revolving credit line of the Credit Facility was $ 84,033 as of February 28, 2023. Any amounts outstanding under the Credit Facility will mature and become immediately due on April 19, 2026 ; however, the Credit Facility is subject to acceleration upon the occurrence of an Event of Default (as defined in the Credit Agreement). The Company may prepay any amounts outstanding at any time. Commitments under the Credit Facility may be irrevocably reduced at any time, without premium or penalty as set forth in the Credit Facility. Pursuant to the amendment to the Credit Facility on February 25, 2023 the LIBOR rate previously in place for the revolving credit facility was replaced by the SOFR rate. As of the effective date of the amendment, any outstanding LIBOR rate loans automatically converted to SOFR Loans. Generally, the Company may designate specific borrowings under the Credit Facility as either Base Rate Loans or SOFR Loans, except that Swing Loans may only be designated as Base Rate Loans. Loans under the Credit Facility designated as SOFR Loans shall bear interest at a rate equal to the then-applicable SOFR Rate plus a range of 1.75 % - 2.25 % ( 6.44 % at February 28, 2023 ). Loans under the Credit Facility designated as Base Rate Loans shall bear interest at a rate equal to the applicable margin for Base Rate Loans of 0.75 % - 1.25 %, as defined in the agreement and shall not be lower than 1.75 % ( 8.50 % at February 28, 2023). Provided the Company is in a Compliance Period (the period commencing on the day in which Excess Availability is less than 15 % of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than 15% for any consecutive 30-day period thereafter) , the Credit Facility requires compliance with a financial covenant calculated as of the last day of each month consisting of a Fixed Charge Coverage Ratio. The Credit Facility also contains covenants, subject to defined carveouts, that limit the ability of the loan parties and certain of their subsidiaries which are not loan parties to, among other things: (i) incur additional indebtedness; (ii) incur liens; (iii) merge, consolidate or dispose of a substantial portion of their business; (iv) transfer or dispose of assets; (v) change their name, organizational identification number, state or province of organization or organizational identity; (vi) make any material change in their nature of business; (vii) prepay or otherwise acquire indebtedness; (viii) cause any change of control; (ix) make any restricted junior payment; (x) change their fiscal year or method of accounting; (xi) make advances, loans or investments; (xii) enter into or permit any transaction with an affiliate of any borrower or any of their subsidiaries; (xiii) use proceeds for certain items; (xiv) issue or sell any of their stock; (xv) consign or sell any of their inventory on certain terms. In addition, if excess availability under the Credit Facility were to fall below certain specified levels, as defined in the Credit Facility, the lenders would have the right to assume dominion and control over the Company's cash. As of February 28, 2023, the Company was not in a Compliance Period. The obligations under the Credit Facility are secured by a general lien on, and security interest in, substantially all of the assets of the borrowers and certain of the guarantors, including accounts receivable, equipment, real estate, general intangibles, and inventory. The Company has guaranteed the obligations of the borrowers under the Credit Facility. The Company has deferred financing costs related to the Credit Facility and previous amendments and modifications of the Credit Facility. In conjunction with the amendment to its Credit Facility on February 15, 2023, the Company incurred additional financing fees of $ 398 that will be amortized over the remaining term of the facility. The Company accounted for the February 2023 amendment to the Credit Facility as a modification of debt. Deferred financing costs are included in Long-term debt on the accompanying Consolidated Balance Sheets as a contra-liability balance and are amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the remaining term of the Credit Facility. The Company amortized $ 231 during the year ended February 28, 2023 and $ 241 during both of the years ended February 28, 2022 and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 1,088 . Charges incurred on the unused portion of the Credit Facility and its predecessor revolving credit facility during the years ended February 28, 2023, February 28, 2022, and February 28, 2021 totaled $ 686 , $ 739 , and $ 504 , respectively, and are included within Interest and Bank Charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . b) Florida Mortgage On July 6, 2015, VOXX HQ LLC, the Company’s wholly owned subsidiary, closed on a $ 9,995 industrial development revenue tax exempt bond under a loan agreement in favor of the Orange County Industrial Development Authority (the “Authority”) to finance the construction of the Company's manufacturing facility and executive offices in Lake Nona, Florida (the “Construction Loan”). Wells Fargo Bank, N.A. ("Wells Fargo") was the purchaser of the bond and U.S. Bank National Association is the trustee under an Indenture of Trust with the Authority. Voxx borrowed the proceeds of the bond purchase from the Authority during construction as a revolving loan, which converted to a permanent mortgage upon completion of the facility in January 2016 (the "Florida Mortgage"). The Company makes principal and interest payments to Wells Fargo, which began March 1, 2016 and will continue through March of 2026. The Florida Mortgage bears interest at 70 % of 1-month LIBOR plus 1.54 % ( 6.21 % at February 28, 2023) and is secured by a first mortgage on the property, a collateral assignment of leases and rents and a guaranty by the Company. The Company is in compliance with the financial covenants of the Florida Mortgage, which are as defined in the Company’s Credit Facility with Wells Fargo dated April 26, 2016 and amended in April 2021 and February 2023. The amendment to the Credit Facility in April 2021 provided for a Benchmark Replacement that will replace the LIBOR rate for the Florida Mortgage. The Benchmark Replacement is subject to the occurrence of a Benchmark Transition Event, as defined in the Second Amended and Restated Credit Agreement and becomes effective after a five-day transition period following the event. The amendment to the Credit Facility in February 2023 was not deemed a Benchmark Transition Event for the Florida Mortgage and the interest rate in effect for this loan remains referenced to LIBOR at February 28, 2023. The Company incurred debt financing costs totaling approximately $ 332 as a result of obtaining the Florida Mortgage, which are recorded as deferred financing costs and included in Long-term debt as a contra-liability balance on the accompanying Consolidated Balance Sheets and are being amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the ten-year term of the Florida Mortgage. The Company amortized $ 31 of these costs during each of the years ended February 28, 2023, February 28, 2022, and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 93 . On July 20, 2015, the Company entered into an interest rate swap agreement in order to hedge interest rate exposure related to the Florida Mortgage and pays a fixed rate of 3.48 % under the swap agreement (see Note 1(e)). On May 1, 2023, VOXX HQ LLC, a wholly owned subsidiary of the Company, consented to a First Amendment and Supplement to the Indenture of Trust relating to the Florida Industrial Revenue Bonds which were purchased by Wells Fargo N.A., and which provided for a replacement benchmark from LIBOR to SOFR including a modification to the interest rate to 79 % of the applicable SOFR Rate plus 1.87 %. On May 3, 2023, VOXX HQ LLC entered into an Amended and Restated Confirmation of Swap Transaction with Wells Fargo Bank N.A. related to the interest rate swap that hedges the Company's interest rate exposure on the Florida Industrial Revenue Bonds. The swap contract was amended to reference the SOFR Rate, as well as set a new fixed rate equal to 3.43 % c) Euro Asset-Based Lending Obligation – VOXX Germany Foreign bank obligations include a Euro Asset-Based Lending ("ABL") credit facility, which has a credit limit of € 8,000 , for the Company's subsidiary, VOXX Germany, which expires on July 31, 2023. The rate of interest for the ABL is the three-month Euribor plus 2.30 % ( 5.04 % at February 28, 2023 ). d) Shareholder Loan Payable to Sharp Asset In conjunction with the capitalization and funding of the Company’s Onkyo joint venture with its partner Sharp, which was created in order to execute the acquisition of certain assets of the home audio/video business of OHEC on September 8, 2021 (see Note 2), Onkyo entered into a loan agreement with the shareholders of the joint venture, PAC and Sharp. The loan balance outstanding at February 28, 2023 represents the portion of the loan payable to Sharp. The loan balance due to PAC eliminates in consolidation. All amounts outstanding under the loan will mature and become payable ten years from the execution date of the acquisition, which is September 8, 2031. The loan may be prepaid subject the approval of the board of directors of the joint venture and must be repaid if either the put or call option is exercised in accordance with the joint venture agreement. The rate of interest for the shareholder loan is 2.5 % and the loan is secured by a second priority lien on and secured interest in all assets of Onkyo. |
Schedule of Maturities of Long-term Debt | The following is a maturity table for debt and bank obligations outstanding at February 28, 2023 for each of the following fiscal years: 2024 $ 500 2025 500 2026 500 2027 33,615 2028 - Thereafter 4,079 Total $ 39,194 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income (Loss) Before Provision (Benefit) for Income Taxes | The components of income (loss) before the provision (benefit) for income taxes are as follows: Year Year Year February 28, February 28, February 28, Domestic Operations $ ( 33,501 ) $ ( 26,665 ) $ 24,485 Foreign Operations 2,551 826 3,153 $ ( 30,950 ) $ ( 25,839 ) $ 27,638 |
Schedule of Provision (Benefit) for Income Taxes | The provision (benefit) for income taxes is comprised of the following: Year Year Year February 28, February 28, February 28, Current provision (benefit) Federal $ 254 $ 20 $ ( 10 ) State 242 804 1,172 Foreign 1,248 2,148 496 Total current provision $ 1,744 $ 2,972 $ 1,658 Deferred (benefit) provision Federal $ ( 394 ) $ ( 2,300 ) $ 3,362 State ( 271 ) 1,010 ( 84 ) Foreign ( 1,118 ) ( 56 ) ( 664 ) Total deferred (benefit) provision $ ( 1,783 ) $ ( 1,346 ) $ 2,614 Total (benefit) provision Federal $ ( 140 ) $ ( 2,280 ) $ 3,352 State ( 29 ) 1,814 1,088 Foreign 130 2,092 ( 168 ) Total (benefit) provision $ ( 39 ) $ 1,626 $ 4,272 |
Schedule of Effective Tax Rate Before Income Taxes | The effective tax rate before income taxes varies from the current statutory U.S. federal income tax rate as follows: Year Year Year February 28, February 28, February 28, Tax benefit at Federal statutory rates $ ( 6,499 ) 21.0 % $ ( 5,426 ) 21.0 % $ 5,804 21.0 % State income taxes, net of Federal benefit ( 711 ) 2.3 ( 282 ) 1.1 983 3.5 Change in valuation allowance 5,785 ( 18.7 ) 7,214 ( 28.0 ) ( 3,365 ) ( 12.2 ) Change in tax reserves ( 173 ) 0.5 ( 227 ) 0.9 ( 311 ) ( 1.1 ) Non-controlling interest 476 ( 1.5 ) 766 ( 3.0 ) 714 2.6 U.S. effects of foreign operations 379 ( 1.2 ) ( 2,135 ) 8.3 521 1.9 Permanent differences and other 794 ( 2.6 ) 581 ( 2.2 ) ( 192 ) ( 0.7 ) Foreign rate differential 402 ( 1.3 ) 787 ( 3.1 ) 412 1.5 Change in tax rate 39 ( 0.1 ) 105 ( 0.4 ) 102 0.4 Research & development credits ( 531 ) 1.7 243 ( 0.9 ) ( 396 ) ( 1.4 ) Effective tax rate $ ( 39 ) 0.1 % $ 1,626 ( 6.3 )% $ 4,272 15.5 % |
Schedule of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effects of temporary differences between the carrying values of assets and liabilities for financial reporting and tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: February 28, February 28, Deferred tax assets: Accounts receivable $ 192 $ 301 Inventory 4,196 4,356 Property, plant and equipment 2,467 1,903 IRC Section 174 - Capitalized R&D 3,735 — Interim arbitration award 10,453 9,515 Operating lease 811 999 Accruals and reserves 6,097 5,946 Deferred compensation 268 297 Warranty reserves 1,465 692 Unrealized gains and losses 4,877 4,219 Partnership investments 3,262 3,399 Net operating losses 5,270 6,278 Foreign tax credits 1,739 2,254 Other tax credits 5,344 5,220 Deferred tax assets before valuation allowance 50,176 45,379 Less: valuation allowance ( 35,421 ) ( 30,059 ) Total deferred tax assets 14,755 15,320 Deferred tax liabilities: Intangible assets ( 16,035 ) ( 17,464 ) Prepaid expenses ( 1,513 ) ( 2,079 ) Operating lease ( 798 ) ( 977 ) Deferred financing fees ( 46 ) ( 60 ) Total deferred tax liabilities ( 18,392 ) ( 20,580 ) Net deferred tax liability $ ( 3,637 ) $ ( 5,260 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows: Balance at February 29, 2020 $ 7,235 Additions based on tax positions taken in the current and prior years 3 Settlements — Decreases based on tax positions taken in the prior years ( 490 ) Other 112 Balance at February 28, 2021 $ 6,860 Additions based on tax positions taken in the current and prior years 140 Settlements — Decreases based on tax positions taken in the prior years ( 563 ) Other ( 172 ) Balance at February 28, 2022 $ 6,265 Additions based on tax positions taken in the current and prior years 114 Settlements — Decreases based on tax positions taken in prior years ( 484 ) Other 89 Balance at February 28, 2023 $ 5,984 |
Schedule of Tax Returns Subject to Examination by Tax Authorities in Major Jurisdictions | The Company, or one of its subsidiaries, files its tax returns in the U.S. and certain state and foreign income tax jurisdictions with varying statutes of limitations. The earliest years' tax returns filed by the Company that are still subject to examination by the tax authorities in the major jurisdictions are as follows: Jurisdiction Tax Year U.S. 2018 Netherlands 2017 Germany 2018 |
Capital Structure (Tables)
Capital Structure (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Equity [Abstract] | |
Schedule of Capital Units | The Company's capital structure is as follows: Shares Authorized Shares Outstanding Security Par February 28, February 28, February 28, February 28, Voting Liquidation Preferred Stock $ 50.00 50,000 50,000 — — — $ 50 per share Series Preferred Stock $ 0.01 1,500,000 1,500,000 — — — Class A Common Stock $ 0.01 60,000,000 60,000,000 21,167,527 21,614,629 one Ratably with Class B Class B Common Stock $ 0.01 10,000,000 10,000,000 2,260,954 2,260,954 ten Ratably with Class A |
Lease Obligations (Tables)
Lease Obligations (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Leases [Abstract] | |
Schedule of Components of Lease Cost | The components of lease cost for the year ended February 28, 2023 were as follows: February 28, February 28, February 28, Operating lease cost (a) (c) $ 1,508 $ 1,383 $ 1,169 Finance lease cost: Amortization of right of use assets (a) 283 403 596 Interest on lease liabilities (b) 4 11 28 Total finance lease cost $ 287 $ 414 $ 624 (a) Recorded within Selling, general, and administrative; Engineering and technical support; and Cost of sales on the Consolidated Statements of Operations and Comprehensive (Loss) Income . (b) Recorded within Interest and bank charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . (c) Includes immaterial amounts related to variable rent expense. |
Schedule of Supplemental Balance Sheet Information Related to Leases | Supplemental balance sheet information related to leases is as follows: February 28, 2023 February 28, 2022 Operating Leases Operating lease, right of use assets $ 3,632 $ 4,464 Total operating lease right of use assets $ 3,632 $ 4,464 Accrued expenses and other current liabilities $ 1,173 $ 1,255 Operating lease liabilities, less current portion 2,509 3,298 Total operating lease liabilities $ 3,682 $ 4,553 Finance Leases Property, plant and equipment, gross $ 2,754 $ 2,503 Accumulated depreciation ( 2,491 ) ( 2,208 ) Total finance lease right of use assets $ 263 $ 295 Accrued expenses and other current liabilities $ 203 $ 224 Finance lease liabilities, less current portion 63 78 Total finance lease liabilities $ 266 $ 302 Weighted Average Remaining Lease Term Operating leases 5.0 years 5.5 years Finance leases 1.2 years 1.3 years Weighted Average Discount Rate Operating leases 3.83 % 4.01 % Finance leases 3.51 % 3.87 % |
Schedule of Maturities of Leases Liabilities | At February 28, 2023, maturities of lease liabilities for each of the succeeding years were as follows: Operating Leases Finance Leases 2024 $ 1,269 $ 203 2025 780 64 2026 547 — 2027 374 — 2028 245 — Thereafter 787 — Total lease payments 4,002 267 Less imputed interest 320 1 Total $ 3,682 $ 266 |
Financial and Product Informa_2
Financial and Product Information About Foreign and Domestic Operations (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Data from Continuing Operations | Segment data for each of the Company's segments are presented below: Automotive Electronics Consumer Electronics Biometrics Corporate/ Total Fiscal Year Ended February 28, 2023 Net sales $ 174,811 $ 357,758 $ 1,046 $ 399 $ 534,014 Equity in income of equity investees 6,969 — — — 6,969 Interest expense and bank charges 1,917 8,033 1,720 ( 7,027 ) 4,643 Depreciation and amortization expense 3,245 6,534 287 3,064 13,130 Loss before income taxes (a) (b) (c) ( 3,236 ) ( 1,101 ) ( 5,816 ) ( 20,797 ) ( 30,950 ) Fiscal Year Ended February 28, 2022 Net sales $ 200,594 $ 433,925 $ 882 $ 519 $ 635,920 Equity in income of equity investees 7,890 — — — 7,890 Interest expense and bank charges 1,510 7,827 1,662 ( 8,467 ) 2,532 Depreciation and amortization expense 3,049 4,957 297 4,095 12,398 Income (loss) before income taxes (b) 8,471 28,645 ( 9,354 ) ( 53,601 ) ( 25,839 ) Fiscal Year Ended February 28, 2021 Net sales $ 163,903 $ 398,263 $ 836 $ 603 $ 563,605 Equity in income of equity investees 7,350 — — — 7,350 Interest expense and bank charges 1,540 8,537 1,475 ( 8,573 ) 2,979 Depreciation and amortization expense 2,881 3,856 322 3,974 11,033 Income (loss) before income taxes (d) 9,608 38,939 ( 8,726 ) ( 12,183 ) 27,638 (a) Included within Loss before income taxes within the Automotive Electronics segment for the year ended February 28, 2023 is a goodwill impairment charge of $ 7,373 and an intangible asset impairment charge of $ 1,300 (see Note 1(k)) . (b) Included within Income (loss) before income taxes within Corporate/Eliminations for the year ended February 28, 2022 is a charge of $ 39,444 recorded for an interim arbitration award unfavorable to the Company (see Note 15). Included within Loss before income taxes on Corporate/Eliminations for the year ended February 28, 2023 are interest charges of $ 3,944 related to the interim arbitration award. (c) Included within Loss before income taxes within Corporate/Eliminations for the year ended February 28, 2023 are foreign currency losses of $ 3,267 attributable to the Company's Onkyo subsidiary related to intercompany transactions and financial statement translation adjustments. (d) Included within Income (loss) before income taxes within the Consumer Electronics segment for the year ended February 28, 2021 is an intangible asset impairment charge of $ 1,300 (see Note 1(k)). |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas | Geographic net sales information in the table below is based on the location of the selling entity. Long-lived assets, consisting of fixed assets, are reported below based on the location of the asset. United Europe Other Total Fiscal Year Ended February 28, 2023 Net sales $ 421,296 $ 79,677 $ 33,041 $ 534,014 Long-lived assets 41,925 3,164 1,955 47,044 Fiscal Year Ended February 28, 2022 Net sales $ 506,226 $ 97,396 $ 32,298 $ 635,920 Long-lived assets 44,751 3,422 1,621 49,794 Fiscal Year Ended February 29, 2021 Net sales $ 477,608 $ 82,134 $ 3,863 $ 563,605 Long-lived assets 46,614 3,569 1,843 52,026 |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 12 Months Ended |
Feb. 28, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | In the following table, the Company's net sales are disaggregated by segments and product type for the years ended February 28, 2023, February 28, 2022, and February 28, 2021. Year Ended Year Ended Year Ended February 29, 2023 2022 2021 Automotive Electronics Segment OEM Products $ 72,979 $ 65,017 $ 46,170 Aftermarket Products 101,832 135,577 117,733 Total Automotive Electronics Segment 174,811 200,594 163,903 Consumer Electronics Segment Premium Audio Products 274,544 343,991 299,908 Other Consumer Electronic Products 83,214 89,934 98,355 Total Consumer Electronics Segment 357,758 433,925 398,263 Biometrics Segment Biometric Products 1,046 882 836 Total Biometrics Segment 1,046 882 836 Corporate/Eliminations 399 519 603 Total Net Sales $ 534,014 $ 635,920 $ 563,605 |
Reconciliation of Contract Liabilities | The following table provides a reconciliation of the Company’s contract liabilities as of February 28, 2023 : Balance at February 28, 2022 $ 5,412 Subscription payments received 6,775 Revenue recognized ( 7,369 ) Balance at February 28, 2023 $ 4,818 |
Description of Business and S_4
Description of Business and Summary of Significant Accounting Policies - Principles of Consolidation, Reclassifications and Accounting Principles - Additional Information (Details) | 12 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
Percentage of revenue, expenses, assets and liabilities reflect in financial statement | 100% |
Equity method investment ownership percentage not owned | 100% |
Description of Business and S_5
Description of Business and Summary of Significant Accounting Policies - Cash and Cash Equivalents - Additional Information (Details) - USD ($) $ in Thousands | Jan. 01, 2018 | Feb. 28, 2023 | Feb. 28, 2022 |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||
Cash and cash equivalents | $ 6,134 | $ 27,788 | |
Percentage of participation exemption on dividends received from foreign corporation | 100% | ||
Domestic Tax Authority [Member] | |||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||
Cash and cash equivalents | 0 | 0 | |
Non-US [Member] | |||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||
Cash and cash equivalents | $ 129 | $ 762 |
Description of Business and S_6
Description of Business and Summary of Significant Accounting Policies - Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Assets: | ||
Cash and money market funds | $ 6,134 | $ 27,788 |
Mutual funds | 1,053 | 1,231 |
Derivatives designated for hedging | $ 207 | |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent | |
Liabilities: | ||
Derivatives designated for hedging | $ 188 | |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | |
Contingent consideration | $ 4,500 | $ 6,435 |
Level 1 [Member] | ||
Assets: | ||
Cash and money market funds | 6,134 | 27,788 |
Derivatives designated for hedging | 0 | |
Liabilities: | ||
Derivatives designated for hedging | 0 | |
Contingent consideration | 0 | 0 |
Level 2 [Member] | ||
Assets: | ||
Cash and money market funds | 0 | 0 |
Derivatives designated for hedging | $ 207 | |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets, Noncurrent | |
Liabilities: | ||
Derivatives designated for hedging | $ 188 | |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | |
Contingent consideration | $ 0 | $ 0 |
Level 3 [Member] | ||
Assets: | ||
Cash and money market funds | 0 | 0 |
Derivatives designated for hedging | 0 | |
Liabilities: | ||
Derivatives designated for hedging | 0 | |
Contingent consideration | 6,435 | |
Mutual Funds [Member] | ||
Assets: | ||
Mutual funds | 1,053 | 1,231 |
Mutual Funds [Member] | Level 1 [Member] | ||
Assets: | ||
Mutual funds | 1,053 | 1,231 |
Mutual Funds [Member] | Level 2 [Member] | ||
Assets: | ||
Mutual funds | 0 | 0 |
Mutual Funds [Member] | Level 3 [Member] | ||
Assets: | ||
Mutual funds | $ 0 | $ 0 |
Description of Business and S_7
Description of Business and Summary of Significant Accounting Policies - Company's Contingent Consideration Balance (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Foreign currency translation | $ (3,674) | $ (635) | $ (862) |
Contingent Consideration [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value, Beginning Balance | 6,435 | ||
Payments | (1,620) | ||
Fair value adjustment | 50 | ||
Purchase price allocation adjustment | 1,051 | ||
Gain on settlement | (443) | ||
Foreign currency translation | (973) | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value, Ending Balance | $ 4,500 | $ 6,435 |
Description of Business and S_8
Description of Business and Summary of Significant Accounting Policies - Fair Value Measurements and Derivatives - Additional Information (Details) | 1 Months Ended | 12 Months Ended | |||||
Feb. 28, 2023 USD ($) | Feb. 10, 2023 USD ($) Instalment | Feb. 28, 2023 USD ($) | Feb. 28, 2023 USD ($) | Feb. 28, 2022 | Mar. 31, 2020 | Jul. 20, 2015 | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||||
Derivative, Fixed Interest Rate | 3.43% | 3.48% | |||||
Foreign currency contracts settled date | Feb. 28, 2022 | ||||||
Amount excluded from assessment of hedge effectiveness | $ 0 | ||||||
Foreign currency contracts terminated | 0 | 0 | 0 | ||||
Foreign currency contracts de-designated | 0 | 0 | 0 | 0 | |||
Interest Rate Swap [Member] | |||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||||
Current outstanding notional value | $ 6,115,000 | $ 6,115,000 | $ 6,115,000 | ||||
Onkyo Home Entertainment Corporation [Member] | |||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||||||
Contingent consideration obligation settled | $ 6,000,000 | ||||||
Gain on settlement | $ 443,000 | ||||||
Contingent consideration obligation settled number of instalments | Instalment | 3 | ||||||
Contingent consideration percentage relieves on future product purchases | 2% | ||||||
Contingent consideration obligation first installment | $ 1,500,000 | $ 1,500,000 | |||||
Contingent consideration obligation remaining instalment | $ 4,500,000 | ||||||
Bankruptcy filing date | May 13, 2022 |
Description of Business and S_9
Description of Business and Summary of Significant Accounting Policies - Fair Value, by Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Derivative Assets and Liabilities | $ 207 | $ (188) |
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Other assets | 207 | 0 |
Other long-term liabilities | $ 0 | $ (188) |
Description of Business and _10
Description of Business and Summary of Significant Accounting Policies - Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) (Details) - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Foreign Exchange Forward [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | $ 233 | |
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | $ 63 | $ (307) |
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax | Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification and Tax |
Interest Rate Swap [Member] | ||
Derivative Instruments Gain Loss [Line Items] | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, before Tax | $ 395 | $ 258 |
Description of Business and _11
Description of Business and Summary of Significant Accounting Policies - Summary of Investment Securities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Gain (Loss) on Securities [Line Items] | ||
Marketable Equity Securities | $ 1,053 | $ 1,231 |
Mutual funds | 1,053 | 1,231 |
Mutual Funds [Member] | ||
Gain (Loss) on Securities [Line Items] | ||
Marketable Equity Securities | 1,053 | 1,231 |
Mutual funds | $ 1,053 | $ 1,231 |
Description of Business and _12
Description of Business and Summary of Significant Accounting Policies - Investment Securities - Additional Information (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2021 USD ($) | |
Gain (Loss) on Securities [Line Items] | |
Cost-method investments, realized gain (loss) | $ 42 |
RxNetworks [Member] | |
Gain (Loss) on Securities [Line Items] | |
Cost-method investments, realized gain (loss) | $ 42 |
Description of Business and _13
Description of Business and Summary of Significant Accounting Policies - Revenue Recognition - Additional Information (Details) | 12 Months Ended |
Feb. 28, 2023 | |
Minimum [Member] | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |
Warrant period | 30 days |
Maximum [Member] | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |
Warrant period | 3 years |
Description of Business and _14
Description of Business and Summary of Significant Accounting Policies - Accounts Receivable - Additional Information (Details) $ in Thousands | 12 Months Ended | |||
Mar. 01, 2020 | Feb. 28, 2023 USD ($) Customer | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | |
Proceeds from sale of continuing operations | $ 98,300 | $ 89,400 | $ 100,800 | |
Interest and Bank Charges [Member] | ||||
Fees incurred in connection with the agreements | $ 730 | $ 260 | $ 330 | |
ASU 2016-13 [Member] | ||||
Change in accounting principle accounting standards update adoption date | Mar. 01, 2020 | |||
Change in accounting principle, accounting standards update, adopted | true | |||
Change in accounting principle, accounting standards update, immaterial effect | true | |||
Customer [Member] | Accounts Receivable [Member] | ||||
Number of largest customer | Customer | 5 | |||
Largest Customer [Member] | Customer [Member] | Accounts Receivable [Member] | ||||
Concentration risk, percentage | 20% | 24% | ||
Minimum [Member] | ||||
Due date of AR, number of days | 30 days | |||
Due date of trade receivables number of days | 30 days | |||
Maximum [Member] | ||||
Due date of AR, number of days | 60 days | |||
Due date of trade receivables number of days | 60 days |
Description of Business and _15
Description of Business and Summary of Significant Accounting Policies - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 |
Accounting Policies [Abstract] | ||||
Trade accounts receivable | $ 85,268 | $ 108,915 | ||
Allowance for credit losses | 1,398 | 2,182 | ||
Allowance for cash discounts | 1,117 | 1,108 | $ 1,104 | $ 751 |
Accounts receivable | $ 82,753 | $ 105,625 |
Description of Business and _16
Description of Business and Summary of Significant Accounting Policies - Inventory - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Inventory Write-down | $ 2,811 | $ 2,912 | $ 2,032 |
Description of Business and _17
Description of Business and Summary of Significant Accounting Policies - Schedule of Inventory, Current (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Accounting Policies [Abstract] | ||
Raw materials | $ 28,048 | $ 23,904 |
Work in process | 1,363 | 1,519 |
Finished goods | 145,718 | 149,499 |
Inventory, net | $ 175,129 | $ 174,922 |
Description of Business and _18
Description of Business and Summary of Significant Accounting Policies - Summary of Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Accounting Policies [Abstract] | ||
Land | $ 7,101 | $ 7,046 |
Buildings | 44,669 | 44,177 |
Property under finance lease | 2,754 | 2,503 |
Furniture and fixtures | 4,600 | 4,489 |
Machinery and equipment | 10,514 | 10,287 |
Construction-in-progress | 748 | 3,341 |
Computer hardware and software | 46,313 | 41,962 |
Automobiles | 681 | 710 |
Leasehold improvements | 3,008 | 2,718 |
Property, Plant and Equipment, Gross | 120,388 | 117,233 |
Less accumulated depreciation and amortization | 73,344 | 67,439 |
Property, Plant and Equipment, Net | $ 47,044 | $ 49,794 |
Description of Business and _19
Description of Business and Summary of Significant Accounting Policies - Summary of Estimated Useful Lives of Assets (Details) | 12 Months Ended |
Feb. 28, 2023 | |
Building and Building Improvements [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 20 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 40 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 15 years |
Machinery and Equipment [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Machinery and Equipment [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 15 years |
Computer Equipment [Member] | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Computer Equipment [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 5 years |
Other Machinery and Equipment [Member] | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, Plant and Equipment, Useful Life | 3 years |
Description of Business and _20
Description of Business and Summary of Significant Accounting Policies - Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Property Plant And Equipment [Line Items] | |||
Depreciation | $ 6,282 | $ 5,890 | $ 5,607 |
Capitalized Computer Software, Amortization | $ 1,659 | $ 1,547 | $ 1,252 |
Description of Business and _21
Description of Business and Summary of Significant Accounting Policies - Goodwill and Intangible Assets - Additional Information (Details) | 12 Months Ended | ||||
Feb. 28, 2023 USD ($) Segment | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | Feb. 28, 2021 USD ($) | Feb. 29, 2020 USD ($) | |
Goodwill and Intangible Assets [Line Items] | |||||
Number of operating segments | Segment | 3 | ||||
Goodwill, Impairment Loss | $ 7,373,000 | $ 0 | $ 0 | ||
Goodwill | 65,308,000 | 74,320,000 | $ 58,311,000 | 58,311,000 | $ 55,000,000 |
Non-cash impairment charge | 1,300,000 | ||||
Non-cash goodwill impairment charge | 7,373,000 | ||||
Impairment charges | 1,300,000 | 1,300,000 | |||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 0 | ||||
Impairment of definite-lived intangible assets | $ 0 | 0 | 0 | ||
Indefinite lived trademarks, percentage of total | 17.70% | ||||
Indefinite-lived Intangible Assets (Excluding Goodwill) | $ 9,872,000 | ||||
Finite-lived intangible asset, weighted average period before next renewal or extension | 4 years | ||||
Amortization of intangible assets | $ 6,848,000 | 6,508,000 | 5,426,000 | ||
Consumer Electronics [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | 62,256,000 | $ 63,895,000 | $ 46,533,000 | 46,533,000 | $ 46,533,000 |
Impairment charges | $ 1,300,000 | ||||
Klipsch [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | 46,532,000 | ||||
Rosen [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | 880,000 | ||||
VSHC [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | 572,000 | ||||
DEI [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | 1,600,000 | ||||
Onkyo [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Goodwill | $ 15,724,000 | ||||
Minimum [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 1.25% | ||||
Minimum [Member] | Measurement Input, Cap Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 14.90% | ||||
Minimum [Member] | Measurement Input, Discount Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 13.50% | ||||
Minimum [Member] | Measurement Input, Long-term Revenue Growth Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 1.50% | ||||
Maximum [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 5.50% | ||||
Maximum [Member] | Measurement Input, Cap Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 25% | ||||
Maximum [Member] | Measurement Input, Discount Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 16.50% | ||||
Maximum [Member] | Measurement Input, Long-term Revenue Growth Rate [Member] | |||||
Goodwill and Intangible Assets [Line Items] | |||||
Impaired long-lived assets held and used, method for determining fair value | 2.50% |
Description of Business and _22
Description of Business and Summary of Significant Accounting Policies - Change in Carrying Value of Goodwill (Details) - USD ($) | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Goodwill [Line Items] | |||
Goodwill | $ 74,320,000 | $ 58,311,000 | $ 55,000,000 |
Goodwill, Acquired During Period | 0 | 18,160,000 | 3,290,000 |
Adjustments to goodwill acquired, net | 1,051,000 | (1,353,000) | 21,000 |
Impairment charge | (7,373,000) | 0 | 0 |
Foreign currency translation | (2,690,000) | (798,000) | 0 |
Goodwill | 65,308,000 | 74,320,000 | 58,311,000 |
Goodwill, Gross | 104,844,000 | 106,483,000 | 90,474,000 |
Goodwill, Impaired, Accumulated Impairment Loss | (39,536,000) | (32,163,000) | (32,163,000) |
Automotive Electronics [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 10,425,000 | 11,778,000 | 8,467,000 |
Goodwill, Acquired During Period | 0 | 0 | 3,290,000 |
Adjustments to goodwill acquired, net | 0 | (1,353,000) | 21,000 |
Impairment charge | (7,373,000) | 0 | 0 |
Goodwill | 3,052,000 | 10,425,000 | 11,778,000 |
Goodwill, Gross | 10,425,000 | 10,425,000 | 11,778,000 |
Goodwill, Impaired, Accumulated Impairment Loss | (7,373,000) | 0 | 0 |
Consumer Electronics [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 63,895,000 | 46,533,000 | 46,533,000 |
Goodwill, Acquired During Period | 0 | 18,160,000 | 0 |
Adjustments to goodwill acquired, net | 1,051,000 | 0 | 0 |
Foreign currency translation | (2,690,000) | (798,000) | 0 |
Goodwill | 62,256,000 | 63,895,000 | 46,533,000 |
Goodwill, Gross | 94,419,000 | 96,058,000 | 78,696,000 |
Goodwill, Impaired, Accumulated Impairment Loss | $ (32,163,000) | $ (32,163,000) | $ (32,163,000) |
Description of Business and _23
Description of Business and Summary of Significant Accounting Policies - Schedule of Intangible Assets, Excluding Goodwill (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | $ 104,121 | $ 101,709 |
Finite-Lived Intangible Assets, Accumulated Amortization | 69,592 | 63,293 |
Finite-Lived Intangible Assets, Net | 34,529 | 38,416 |
Intangible assets, net | 90,437 | 101,450 |
Indefinite-lived Intangible Assets (Excluding Goodwill) | 9,872 | |
Trademarks [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Indefinite-lived Intangible Assets (Excluding Goodwill) | 55,908 | 63,034 |
Customer Relationships [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 53,790 | 54,138 |
Finite-Lived Intangible Assets, Accumulated Amortization | 42,786 | 39,669 |
Finite-Lived Intangible Assets, Net | 11,004 | 14,469 |
Trademarks/Tradenames [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 21,205 | 17,466 |
Finite-Lived Intangible Assets, Accumulated Amortization | 3,360 | 1,927 |
Finite-Lived Intangible Assets, Net | 17,845 | 15,539 |
Developed Technology [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 19,434 | 20,413 |
Finite-Lived Intangible Assets, Accumulated Amortization | 14,645 | 13,179 |
Finite-Lived Intangible Assets, Net | 4,789 | 7,234 |
Patents [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 6,736 | 6,736 |
Finite-Lived Intangible Assets, Accumulated Amortization | 5,845 | 5,562 |
Finite-Lived Intangible Assets, Net | 891 | 1,174 |
License [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 1,400 | 1,400 |
Finite-Lived Intangible Assets, Accumulated Amortization | 1,400 | 1,400 |
Finite-Lived Intangible Assets, Net | 0 | 0 |
Contracts [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 1,556 | 1,556 |
Finite-Lived Intangible Assets, Accumulated Amortization | 1,556 | 1,556 |
Finite-Lived Intangible Assets, Net | $ 0 | $ 0 |
Description of Business and _24
Description of Business and Summary of Significant Accounting Policies - Schedule of Intangible Assets, Excluding Goodwill (Parenthetical) (Details) | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Customer Relationships [Member] | Minimum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | 4 years |
Customer Relationships [Member] | Maximum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 15 years 6 months | 15 years 6 months |
Trademarks/Tradenames [Member] | Minimum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 5 years 6 months | 5 years 6 months |
Trademarks/Tradenames [Member] | Maximum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | 10 years |
Developed Technology [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 7 years | |
Developed Technology [Member] | Minimum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 7 years | |
Developed Technology [Member] | Maximum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 10 years | |
Patents [Member] | Minimum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 7 years | 4 years |
Patents [Member] | Maximum [Member] | ||
Goodwill and Intangible Assets [Line Items] | ||
Finite-lived intangible asset, useful life | 13 years | 13 years |
Description of Business and _25
Description of Business and Summary of Significant Accounting Policies - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Thousands | Feb. 28, 2023 USD ($) |
Accounting Policies [Abstract] | |
2024 | $ 6,215 |
2025 | 5,948 |
2026 | 5,848 |
2027 | 3,616 |
2028 | $ 3,144 |
Description of Business and _26
Description of Business and Summary of Significant Accounting Policies - Summary of Activity with Respect to Accrued Sales Incentives (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Accrued sales incentives, opening balance | $ 23,755 | $ 25,313 | $ 12,250 |
Accruals | 50,056 | 58,490 | 67,337 |
Payments and credits | (51,894) | (59,644) | (54,102) |
Reversals for unearned sales incentives | (139) | (404) | (172) |
Accrued sales incentives, ending balance | $ 21,778 | $ 23,755 | $ 25,313 |
Description of Business and _27
Description of Business and Summary of Significant Accounting Policies - Advertising - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Advertising Expense | $ 5,448 | $ 5,376 | $ 4,605 |
Description of Business and _28
Description of Business and Summary of Significant Accounting Policies - Research and Development - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Research and Development [Abstract] | |||
Research and development expense | $ 9,419 | $ 12,115 | $ 7,940 |
Engineering and Technical Support [Member] | |||
Research and Development [Abstract] | |||
Customer reimbursement expenses | $ 936 | $ 58 | $ 120 |
Description of Business and _29
Description of Business and Summary of Significant Accounting Policies - Product Warranties and Product Repair Costs - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Standard product warranty accrual | $ 5,845 | $ 4,470 | |
Inventory valuation reserves | 914 | 1,152 | |
Product warranty expense | $ 6,525 | $ 4,583 | $ 3,065 |
Description of Business and _30
Description of Business and Summary of Significant Accounting Policies - Changes in Accrued Product Warranties and Product Repair Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Beginning balance | $ 5,622 | $ 5,290 | $ 4,748 |
Liabilities (adjusted) acquired during acquisitions | 0 | (352) | 1,200 |
Accrual for warranties issued during the year and repair cost | 6,525 | 4,583 | 3,065 |
Warranty claims settled during the year | (5,388) | (3,899) | (3,723) |
Ending balance | $ 6,759 | $ 5,622 | $ 5,290 |
Description of Business and _31
Description of Business and Summary of Significant Accounting Policies - Foreign Currency - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||
Foreign currency transaction (loss) gains, before tax | $ (3,674) | $ (635) | $ 862 |
Description of Business and _32
Description of Business and Summary of Significant Accounting Policies - Net (Loss) Income Per Common Share - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Redemption value adjustment of redeemable non-controlling interest | $ 0 | $ 0 | $ 0 |
Antidilutive securities excluded from computation of earnings per share, amount | 378,454 | 737,513 | 12,757 |
Description of Business and _33
Description of Business and Summary of Significant Accounting Policies - Reconciliation Between Denominator of Basic and Diluted Net (Loss) Income Per Common Share (Details) - shares | 12 Months Ended | |||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | ||||
Weighted-average common shares outstanding (basic) | 24,325,938 | 24,287,179 | 24,201,221 | |
Restricted stock units, market stock units, and stock grants | 0 | 0 | 448,885 | |
Weighted-average common and potential common shares outstanding (diluted) | 24,325,938 | 24,287,179 | 24,650,106 | 24,650,106 |
Description of Business and _34
Description of Business and Summary of Significant Accounting Policies - Schedule of Other (Expense) Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Accounting Policies [Abstract] | |||
Foreign currency (loss) gain | $ (3,674) | $ (635) | $ (862) |
Interest income | 36 | 72 | 83 |
Rental income | 911 | 678 | 739 |
Miscellaneous | 672 | 208 | 786 |
Total other, net | $ (2,055) | $ 323 | $ 746 |
Description of Business and _35
Description of Business and Summary of Significant Accounting Policies -Other (Expense) Income - Additional Information (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Accounting Policies [Abstract] | |
Foreign currency loss | $ 3,267 |
Description of Business and _36
Description of Business and Summary of Significant Accounting Policies - Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Venezuela [Member] | |||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | |||
Impairment of definitely-lived intangible assets or long-lived assets | $ 0 | $ 0 | $ 0 |
Description of Business and _37
Description of Business and Summary of Significant Accounting Policies - Accounting for Stock-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||||
Feb. 06, 2023 | Mar. 01, 2022 | Mar. 01, 2021 | Mar. 01, 2020 | Jan. 31, 2020 | Jul. 08, 2019 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 28, 2015 | |
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based compensation arrangement by share-based payment award, number of shares available for grant | 1,049,275 | |||||||||
Employee service share-based compensation, nonvested awards, total compensation cost not yet recognized | $ 0 | |||||||||
Non-cash stock-based compensation expense | $ 609 | $ 907 | $ 1,749 | |||||||
Vested and unissued shares | 100,000 | 100,000 | 100,000 | |||||||
Shares withheld for taxes | 38,663 | 39,347 | ||||||||
2014 Plan [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based Compensation arrangement by share-based payment award, equity instruments other than options, grants in period, weighted average grant date fair value | $ 9 | $ 13.59 | $ 7.18 | |||||||
Vested and unissued shares | 33,930 | 197,891 | 99,697 | |||||||
Weighted Average Grant Date Fair Value, Vested | $ 6.10 | $ 5.76 | $ 7.21 | |||||||
Patrick M. Lavelle [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Annual salary and cash bonus | $ 1,000 | |||||||||
Non-cash stock-based compensation expense | $ 91 | $ 241 | $ 241 | |||||||
Grant of market stock units maximum amount | $ 5,000 | |||||||||
Maximum average stock price of grant market stock units | $ 5.49 | |||||||||
Maximum increase amount of market stock units award | $ 5,000 | |||||||||
Maximum threshold share price increases in value of award | $ 15 | |||||||||
Estimated Maximum threshold share increases in value of award | 333,333 | |||||||||
Share-Based compensation arrangement by share based payment award grant of market stock units, vesting percentage | 80% | 20% | ||||||||
Percentage of market stock units, remain outstanding | $ 4,000 | |||||||||
Beat Kahli [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Annual salary | $ 300 | |||||||||
Common Class A [Member] | Patrick M. Lavelle [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Award vesting period | 5 years | |||||||||
Grant of initial shares under employment agreement | 61,337 | 60,653 | 100,000 | |||||||
Common Class A [Member] | Patrick M. Lavelle [Member] | 2012 Plan [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based Compensation arrangement by share-based payment award, equity instruments other than options, grants in period, weighted average grant date fair value | $ 4.15 | |||||||||
Grant of initial shares under employment agreement | 200,000 | |||||||||
Share based compensation related to additional stock grants | $ 0 | $ 157 | $ 409 | |||||||
Common Class A [Member] | Patrick M. Lavelle [Member] | 2012 Plan [Member] | March 1, 2021 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 100,000 | |||||||||
Common Class A [Member] | Patrick M. Lavelle [Member] | 2012 Plan [Member] | March 1, 2020 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 100,000 | |||||||||
Common Class A [Member] | Patrick M. Lavelle [Member] | 2012 Plan [Member] | March 1, 2022 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 100,000 | |||||||||
Common Class A [Member] | Beat Kahli [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based Compensation arrangement by share-based payment award, equity instruments other than options, grants in period, weighted average grant date fair value | $ 10.66 | |||||||||
Common Class A [Member] | Beat Kahli [Member] | June 30, 2023 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 20,000 | |||||||||
Common Class A [Member] | Beat Kahli [Member] | September 30, 2023 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 20,000 | |||||||||
Common Class A [Member] | Beat Kahli [Member] | December 31, 2023 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 20,000 | |||||||||
Common Class A [Member] | Beat Kahli [Member] | March 31, 2024 [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Additional grant of shares under employment agreement | 20,000 | |||||||||
Incentive Stock Options [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Percentage of stockholders granted exercise price | 10% | |||||||||
Incentive Stock Options [Member] | Common Class A [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Percentage of fair market value of stock allowed for exercise price of options to be granted | 110% | |||||||||
Employee Stock Option [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based compensation arrangement by share-based payment award, options, grants in period, gross | 0 | 0 | 0 | |||||||
Allocated share-based compensation expense | $ 0 | $ 0 | $ 0 | |||||||
Restricted Stock Units [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based compensation arrangement by share-based payment award, expiration period | 3 years | |||||||||
Allocated share-based compensation expense | 609 | $ 907 | $ 1,749 | |||||||
Employee service share-based compensation, nonvested awards, total compensation cost not yet recognized | $ 1,270 | |||||||||
Stock issued during period, shares, restricted stock award, gross | 46,556 | 48,527 | 48,269 | |||||||
Share-based Compensation arrangement by share-based payment award, equity instruments other than options, grants in period, weighted average grant date fair value | $ 8.28 | $ 13.59 | $ 5.76 | |||||||
Share-based payment award vesting age of employee | 65 years | |||||||||
Restricted Stock Units [Member] | 2014 Plan [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Vested and unissued shares | 8,634 | 105,123 | ||||||||
Amount of vested and settled awards in cash | $ 81 | $ 575 | ||||||||
Unissued Restricted Stock Unit Awards [Member] | 2014 Plan [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Vested and unissued shares | 501,505 | |||||||||
Weighted Average Grant Date Fair Value, Vested | $ 6.79 | |||||||||
Minimum [Member] | All Other Options and Stock Appreciation Rights [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Percentage of fair market value of stock allowed for exercise price of options to be granted | 100% | |||||||||
Minimum [Member] | All Other Options and Stock Appreciation Rights [Member] | Common Class A [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Percentage of fair market value of stock allowed for exercise price of options to be granted | 100% | |||||||||
Maximum [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based compensation arrangement by share-based payment award, expiration period | 10 years | |||||||||
Maximum [Member] | Restricted Stock Units [Member] | ||||||||||
Description Of Business And Summary Of Significant Accounting Policies [Line Items] | ||||||||||
Share-based payment award vesting required service period | 10 years |
Description of Business and _38
Description of Business and Summary of Significant Accounting Policies - Summary of Activity Related to 2014 Plan and Initial Stock Grant and Additional Stock Grants under Employment Agreement (Details) - $ / shares | 12 Months Ended | |||||
Mar. 01, 2022 | Mar. 01, 2021 | Mar. 01, 2020 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Vested | (100,000) | (100,000) | (100,000) | |||
2014 Plan [Member] | ||||||
Unvested Number of share, Beginning balance | 354,360 | 603,724 | 715,152 | 354,360 | 603,724 | 715,152 |
Granted | 66,556 | 48,527 | 88,269 | |||
Vested | (33,930) | (197,891) | (99,697) | |||
Vested and settled | (100,000) | (100,000) | (100,000) | |||
Forfeited | 0 | 0 | 0 | |||
Unvested Number of share, Ending balance | 286,986 | 354,360 | 603,724 | |||
Weighted Average Grant Date Fair Value, Beginning balance | $ 6.30 | $ 5.18 | $ 5.07 | $ 6.30 | $ 5.18 | $ 5.07 |
Weighted Average Grant Date Fair Value, Granted | 9 | 13.59 | 7.18 | |||
Weighted Average Grant Date Fair Value, Vested | 6.10 | 5.76 | 7.21 | |||
Weighted Average Grant Date Fair Value, Vested and settled | 4.15 | 4.15 | 4.15 | |||
Weighted Average Grant Date Fair Value, Forfeited | 0 | 0 | 0 | |||
Weighted Average Grant Date Fair Value, Ending balance | $ 7.70 | $ 6.30 | $ 5.18 |
Description of Business and _39
Description of Business and Summary of Significant Accounting Policies - Schedule of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Stockholders equity, beginning of period | $ 346,102 | $ 376,069 | $ 348,229 |
Other comprehensive income (loss) before reclassifications | (1,134) | (2,674) | 3,913 |
Reclassified from accumulated other comprehensive (loss) income | (43) | 148 | 165 |
Other comprehensive (loss) income, net of tax | (1,177) | (2,526) | 4,078 |
Stockholders equity, end of period | 304,591 | 346,102 | 376,069 |
Foreign Currency Translation (Losses) Gains [Member] | |||
Stockholders equity, beginning of period | (16,691) | (13,374) | (17,739) |
Other comprehensive income (loss) before reclassifications | (1,876) | (3,317) | 4,365 |
Reclassified from accumulated other comprehensive (loss) income | 0 | 0 | 0 |
Other comprehensive (loss) income, net of tax | (1,876) | (3,317) | 4,365 |
Stockholders equity, end of period | (18,567) | (16,691) | (13,374) |
Pension Plan Adjustments, Net of Tax [Member] | |||
Stockholders equity, beginning of period | (711) | (869) | (887) |
Other comprehensive income (loss) before reclassifications | 390 | 158 | 18 |
Reclassified from accumulated other comprehensive (loss) income | 0 | 0 | 0 |
Other comprehensive (loss) income, net of tax | 390 | 158 | 18 |
Stockholders equity, end of period | (321) | (711) | (869) |
Derivatives Designated in a Hedging Relationship, Net of Tax [Member] | |||
Stockholders equity, beginning of period | (101) | (734) | (429) |
Other comprehensive income (loss) before reclassifications | 352 | 485 | (470) |
Reclassified from accumulated other comprehensive (loss) income | (43) | 148 | 165 |
Other comprehensive (loss) income, net of tax | 309 | 633 | (305) |
Stockholders equity, end of period | 208 | (101) | (734) |
Accumulated Other Comprehensive (Loss) Income [Member] | |||
Stockholders equity, beginning of period | (17,503) | (14,977) | (19,055) |
Other comprehensive (loss) income, net of tax | (1,177) | (2,526) | 4,078 |
Stockholders equity, end of period | $ (18,680) | $ (17,503) | $ (14,977) |
Description of Business and _40
Description of Business and Summary of Significant Accounting Policies - Accumulated Other Comprehensive Loss - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Other comprehensive (income) loss, defined benefit plan, after reclassification adjustment, tax | $ 171 | $ (40) | $ (74) |
Other comprehensive income (loss), cash flow hedge, gain (loss), before reclassification, tax | 20 | (101) | 106 |
Other comprehensive (loss) income before reclassifications | $ (1,134) | $ (2,674) | $ 3,913 |
Minimum [Member] | |||
Foreign currency variance | (10.00%) | (2.00%) | (10.00%) |
Maximum [Member] | |||
Foreign currency variance | 19% | 8% | 6% |
Euro Member Countries, Euro | |||
Other comprehensive (loss) income before reclassifications | $ (1,660) | $ (2,728) | $ 4,136 |
Canada, Dollars | |||
Other comprehensive (loss) income before reclassifications | (193) | (245) | 261 |
Mexico, Pesos | |||
Other comprehensive (loss) income before reclassifications | 57 | 25 | (53) |
Other Currency [Member] | |||
Other comprehensive (loss) income before reclassifications | 92 | (120) | 21 |
Foreign Currency Translation (Losses) Gains [Member] | |||
Other comprehensive (loss) income before reclassifications | (1,876) | (3,317) | 4,365 |
Foreign Currency Translation (Losses) Gains [Member] | Japan, Yen | |||
Other comprehensive (loss) income before reclassifications | (173) | (249) | |
Foreign Currency Translation (Losses) Gains [Member] | Intercompany Transactions Of Long Term Investment Nature [Member] | |||
Other comprehensive (loss) income before reclassifications | 1,639 | 320 | (1,244) |
Foreign Currency Translation (Losses) Gains [Member] | Translating Financial Statements [Member] | |||
Other comprehensive (loss) income before reclassifications | $ (3,515) | $ (3,637) | $ 5,609 |
Description of Business and _41
Description of Business and Summary of Significant Accounting Policies - New Accounting Pronouncements - Additional Information (Details) | Mar. 31, 2020 | Jul. 20, 2015 |
Accounting Policies [Abstract] | ||
Derivative, Fixed Interest Rate | 3.43% | 3.48% |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
Feb. 28, 2023 USD ($) | Feb. 10, 2023 USD ($) Instalment | Sep. 08, 2021 USD ($) | Jul. 01, 2020 USD ($) | Feb. 28, 2023 USD ($) | Nov. 30, 2022 USD ($) | Feb. 28, 2023 USD ($) | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | May 26, 2021 | |
Business Acquisition [Line Items] | ||||||||||
Adjustments to goodwill due to measurement period adjustments, net | $ 1,051 | $ (1,353) | $ 21 | |||||||
Onkyo Home Entertainment Corporation [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Adjustments to goodwill due to measurement period adjustments, net | $ 9,024 | $ 9,024 | 9,024 | |||||||
Contingent consideration payable, percentage of total price of certain future products purchases | 2% | |||||||||
Cash purchase price | $ 21,989 | |||||||||
Bankruptcy filing date | May 13, 2022 | |||||||||
Contingent consideration obligation settled | $ 6,000 | |||||||||
Gain on contingent consideration obligation settlement | $ 443 | |||||||||
Contingent consideration percentage relieves on future product purchases | 2% | |||||||||
Contingent consideration obligation settled number of instalments | Instalment | 3 | |||||||||
Contingent consideration obligation first installment | $ 1,500 | $ 1,500 | ||||||||
Contingent consideration obligation second installment | 2,500 | |||||||||
Contingent consideration obligation third installment | $ 2,000 | |||||||||
Contingent consideration obligation first instalment paid | $ 1,500 | |||||||||
Contingent consideration obligation remaining instalment | $ 4,500 | |||||||||
Company's net sales before consolidation | $ 11,027 | 5,190 | ||||||||
Business combination, consideration transferred | $ 38,235 | |||||||||
Directed LLC and Directed Electronics Canada Inc [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Adjustments to goodwill due to measurement period adjustments, net | $ (1,690) | $ (1,690) | $ (1,690) | |||||||
Cash purchase price | $ 11,000 | |||||||||
Directed LLC and Directed Electronics Canada Inc [Member] | VOXX DEI LLC and VOXX DEI Canada, Ltd. [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of net sales from consolidated net sales | 9.10% | 10.40% | 8.40% | |||||||
PAC [Member] | Onkyo Home Entertainment Corporation [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business acquisition, percentage of interests acquired | 77.20% | |||||||||
Voting interest in joint venture | 85.10% | |||||||||
Sharp Corporation [Member] | Onkyo Home Entertainment Corporation [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business acquisition, percentage of interests acquired | 22.80% | |||||||||
Voting interest in joint venture | 14.90% |
Acquisitions - Summary of Alloc
Acquisitions - Summary of Allocation of Purchase Price Based Upon Fair Value of Assets Acquired (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Sep. 08, 2021 | Nov. 30, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | |
Business Acquisition [Line Items] | ||||||
Adjustments to goodwill due to measurement period adjustments, net | $ 1,051 | $ (1,353) | $ 21 | |||
Allocation: | ||||||
Goodwill | $ 65,308 | 74,320 | $ 58,311 | $ 55,000 | ||
Onkyo Home Entertainment Corporation [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid | $ 21,989 | |||||
Assignment of notes and interest receivable | 8,417 | |||||
Fair value of contingent consideration | 6,710 | |||||
Total transaction consideration | 37,116 | |||||
Intangible assets | 26,929 | |||||
Goodwill | 10,187 | |||||
Total assets acquired | 37,116 | |||||
Fair value of contingent consideration, measurement period adjustments | 1,119 | |||||
Total transaction consideration, measurement period adjustments | 1,119 | |||||
Intangible assets, measurement period adjustments | (7,905) | |||||
Adjustments to goodwill due to measurement period adjustments, net | 9,024 | $ 9,024 | $ 9,024 | |||
Total assets acquired, measurement period adjustments | 1,119 | |||||
Purchase price: | ||||||
Cash paid | 21,989 | |||||
Assignment of notes and interest receivable | 8,417 | |||||
Fair value of contingent consideration | 7,829 | |||||
Total transaction consideration | 38,235 | |||||
Allocation: | ||||||
Intangible assets | 19,024 | |||||
Goodwill | 19,211 | |||||
Total assets acquired | $ 38,235 |
Acquisitions - Summary of Amoun
Acquisitions - Summary of Amounts Assigned to Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 08, 2021 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 65,308 | $ 74,320 | $ 58,311 | $ 55,000 | |
Onkyo Home Entertainment Corporation [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 19,211 | ||||
Intangible assets | 38,235 | ||||
Onkyo Home Entertainment Corporation [Member] | Goodwill [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 19,211 | ||||
Onkyo Home Entertainment Corporation [Member] | Trademarks [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets amortization period | 10 years | ||||
Intangible assets | $ 12,468 | ||||
Onkyo Home Entertainment Corporation [Member] | Developed Technology [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets amortization period | 5 years | ||||
Intangible assets | $ 6,556 |
Acquisitions - Rollforward of t
Acquisitions - Rollforward of the Redeemable Non-controlling Interest (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Business Acquisition [Line Items] | |
Balance at February 28, 2022 | $ 511 |
Balance at February 28, 2023 | 232 |
Onkyo Home Entertainment Corporation [Member] | |
Business Acquisition [Line Items] | |
Balance at February 28, 2022 | 511 |
Net loss attributable to non-controlling interest | (66) |
Comprehensive loss attributable to non-controlling interest | (125) |
Foreign currency translation | (88) |
Balance at February 28, 2023 | $ 232 |
Acquisitions - Summary of All_2
Acquisitions - Summary of Allocation of Purchase Price for Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jul. 01, 2020 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | |
Business Acquisition [Line Items] | |||||
Goodwill, measurement period adjustments | $ 1,051 | $ (1,353) | $ 21 | ||
Goodwill | $ 65,308 | 74,320 | 58,311 | $ 55,000 | |
Directed LLC and Directed Electronics Canada Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Inventory | $ 7,054 | ||||
Accounts receivable | 5,173 | ||||
Other current assets | 160 | ||||
Property and equipment | 2,815 | ||||
Operating lease, right of use asset | 1,771 | ||||
Goodwill | 3,290 | ||||
Total assets acquired | 28,393 | ||||
Accounts payable | 8,144 | ||||
Accrued expenses | 1,406 | ||||
Contract liabilities | 4,872 | ||||
Warranty accrual | 1,200 | ||||
Operating lease liability | 1,771 | ||||
Total | 17,393 | ||||
Total transaction consideration | 11,000 | ||||
Inventory, measurement period adjustments | 956 | ||||
Accounts receivable, measurement period adjustments | 357 | ||||
Goodwill, measurement period adjustments | (1,690) | $ (1,690) | $ (1,690) | ||
Total assets acquired, measurement period adjustments | (477) | ||||
Accrued expenses, right of use asset, measurement period adjustments | (136) | ||||
Contract liabilities, measurement period adjustments | 11 | ||||
Warranty accrual, measurement period adjustments | (352) | ||||
Liabilities assumed, measurement period adjustments | (477) | ||||
Inventory | 8,010 | ||||
Accounts receivable | 5,530 | ||||
Other current assets | 160 | ||||
Property and equipment | 2,815 | ||||
Operating lease, right of use asset | 1,771 | ||||
Goodwill | 1,600 | ||||
Total assets acquired | 27,916 | ||||
Accounts payable | 8,144 | ||||
Accrued expenses | 1,270 | ||||
Contract liabilities | 4,883 | ||||
Warranty accrual | 848 | ||||
Operating lease liability | 1,771 | ||||
Total | 16,916 | ||||
Total purchase price | 11,000 | ||||
Directed LLC and Directed Electronics Canada Inc [Member] | Trademarks [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets other than goodwill | 4,500 | ||||
Intangible assets other than goodwill | 4,500 | ||||
Directed LLC and Directed Electronics Canada Inc [Member] | Customer Relationships [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets other than goodwill | 2,600 | ||||
Intangible assets, measurement period adjustments | (100) | ||||
Intangible assets other than goodwill | 2,500 | ||||
Directed LLC and Directed Electronics Canada Inc [Member] | Patented Technology [Member] | |||||
Business Acquisition [Line Items] | |||||
Intangible assets other than goodwill | 1,030 | ||||
Intangible assets other than goodwill | $ 1,030 |
Variable Interest Entities - Ad
Variable Interest Entities - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Apr. 29, 2021 | Feb. 28, 2023 | Feb. 28, 2019 | Feb. 28, 2022 | |
Variable Interest Entity [Line Items] | ||||
Notes, loans and financing receivable, net, noncurrent | 1.50 | |||
Long-term debt, net of debt issuance costs | $ 37,513,000 | $ 9,786,000 | ||
Distribution agreement liability amount | 7,317,000 | $ 2,451,000 | ||
GalvanEyes [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Quarterly installment payment due amount receivable under distribution agreement. | $ 1,249,000 | |||
GalvanEyes [Member] | Put Arrangement [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Equity interest percentage based on occurrence of certain events | 20% | 20% | ||
Arrangement after initial period Term | 2 years | |||
EyeLock [Member] | Exclusive Distribution Agreement [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Distribution agreement term | 3 years | |||
EyeLock [Member] | Call Arrangement [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Equity interest percentage based on occurrence of certain events | 20% | |||
EyeLock [Member] | GalvanEyes [Member] | Exclusive Distribution Agreement [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Annual fee receivable under distribution agreement subject to certain closing conditions | $ 10,000,000 | |||
Annual fee receivable under distribution agreement term | 2 years | |||
EyeLock [Member] | GalvanEyes [Member] | Maximum [Member] | Exclusive Distribution Agreement [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Quarterly fee receivable under distribution agreement subject to certain closing conditions | $ 5,000,000 | |||
Variable Interest Entity, Primary Beneficiary [Member] | ||||
Variable Interest Entity [Line Items] | ||||
Debt instrument, interest rate during period | 2.50% | 10% | ||
Line of credit facility, maximum borrowing capacity | $ 71,200,000 | |||
Long-term debt, net of debt issuance costs | $ 66,175,000 |
Variable Interest Entities - Su
Variable Interest Entities - Summary of Carrying Values of Assets and Liabilities Included in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Variable Interest Entity [Line Items] | ||
Cash and cash equivalents | $ 6,134 | $ 27,788 |
Accounts receivable, net | 82,753 | 105,625 |
Prepaid expenses and other current assets | 19,817 | 21,340 |
Total current assets | 285,021 | 330,772 |
Property, plant and equipment, net | 47,044 | 49,794 |
Intangible assets, net | 90,437 | 101,450 |
Other assets | 3,720 | 3,245 |
Total assets | 519,451 | 586,664 |
Current portion of long-term debt | 500 | 2,406 |
Total current liabilities | 153,387 | 204,016 |
Prepaid ownership interest due to GalvanEyes LLC | 7,317 | 2,451 |
Other long-term liabilities | 2,947 | 3,508 |
Total liabilities | 210,610 | 236,501 |
Commitments and contingencies | ||
Retained earnings | 97,997 | 126,573 |
Total liabilities, redeemable equity, redeemable non-controlling interest, and stockholders' equity | 519,451 | 586,664 |
Variable Interest Entity, Primary Beneficiary [Member] | ||
Variable Interest Entity [Line Items] | ||
Cash and cash equivalents | 158 | 25 |
Accounts receivable, net | 520 | 47 |
Inventory, net | 1,836 | 2,028 |
Prepaid expenses and other current assets | 93 | 245 |
Total current assets | 2,607 | 2,345 |
Property, plant and equipment, net | 9 | 39 |
Intangible assets, net | 1,786 | 2,057 |
Other assets | 8 | 59 |
Total assets | 4,410 | 4,500 |
Accounts payable | 864 | 1,023 |
Interest payable to VOXX | 14,803 | 13,099 |
Accrued expenses and other current liabilities | 296 | 766 |
Current portion of long-term debt | 66,175 | 66,390 |
Total current liabilities | 82,138 | 81,278 |
Prepaid ownership interest due to GalvanEyes LLC | 7,317 | 2,451 |
Other long-term liabilities | 1,200 | 1,200 |
Total liabilities | 90,655 | 84,929 |
Commitments and contingencies | ||
Capital | 41,416 | 41,416 |
Retained earnings | (127,661) | (121,845) |
Total partners' deficit | (86,245) | (80,429) |
Total liabilities, redeemable equity, redeemable non-controlling interest, and stockholders' equity | $ 4,410 | $ 4,500 |
Variable Interest Entities - _2
Variable Interest Entities - Summary of Revenues and Expenses Included in Consolidated Statements of Operations and Comprehensive (Loss) Income (Details) - USD ($) | 12 Months Ended | |||||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | ||||
Variable Interest Entity [Line Items] | ||||||
Net sales | $ 534,014,000 | $ 635,920,000 | $ 563,605,000 | |||
Cost of sales | 399,715,000 | 466,442,000 | 405,058,000 | |||
Gross profit | 134,299,000 | 169,478,000 | 158,547,000 | |||
Selling | 46,967,000 | 50,507,000 | 43,786,000 | |||
General and administrative | 74,508,000 | 75,955,000 | 69,798,000 | |||
Engineering and technical support | 31,464,000 | 31,540,000 | 20,897,000 | |||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | 0 | |||||
Total operating expenses | 161,576,000 | 161,554,000 | 136,068,000 | |||
Operating (loss) income | (27,277,000) | 7,924,000 | 22,479,000 | |||
Interest and bank charges | (4,643,000) | (2,532,000) | (2,979,000) | |||
Other, net | (2,055,000) | 323,000 | 746,000 | |||
Total other (expense) income, net | (3,673,000) | (33,763,000) | 5,159,000 | |||
(Loss) income before income taxes | (30,950,000) | [1],[2],[3] | (25,839,000) | [1] | 27,638,000 | [4] |
Income Tax Expense (Benefit) | (39,000) | 1,626,000 | 4,272,000 | |||
Net (loss) income | (30,911,000) | (27,465,000) | 23,366,000 | |||
Variable Interest Entity, Primary Beneficiary [Member] | ||||||
Variable Interest Entity [Line Items] | ||||||
Net sales | 1,046,000 | 882,000 | 836,000 | |||
Cost of sales | 688,000 | 694,000 | 1,025,000 | |||
Gross profit | 358,000 | 188,000 | (189,000) | |||
Selling | 575,000 | 653,000 | 603,000 | |||
General and administrative | 1,509,000 | 1,410,000 | 1,785,000 | |||
Engineering and technical support | 2,355,000 | 5,817,000 | 4,674,000 | |||
Total operating expenses | 4,439,000 | 7,880,000 | 7,062,000 | |||
Operating (loss) income | (4,081,000) | (7,692,000) | (7,251,000) | |||
Interest and bank charges | (1,720,000) | (1,662,000) | (1,475,000) | |||
Other, net | (15,000) | |||||
Total other (expense) income, net | (1,735,000) | (1,662,000) | (1,475,000) | |||
(Loss) income before income taxes | (5,816,000) | (9,354,000) | (8,726,000) | |||
Net (loss) income | $ (5,816,000) | $ (9,354,000) | $ (8,726,000) | |||
[1] Included within Income (loss) before income taxes within Corporate/Eliminations for the year ended February 28, 2022 is a charge of $ 39,444 recorded for an interim arbitration award unfavorable to the Company (see Note 15). Included within Loss before income taxes on Corporate/Eliminations for the year ended February 28, 2023 are interest charges of $ 3,944 related to the interim arbitration award. Included within Loss before income taxes within Corporate/Eliminations for the year ended February 28, 2023 are foreign currency losses of $ 3,267 attributable to the Company's Onkyo subsidiary related to intercompany transactions and financial statement translation adjustments. Included within Loss before income taxes within the Automotive Electronics segment for the year ended February 28, 2023 is a goodwill impairment charge of $ 7,373 and an intangible asset impairment charge of $ 1,300 (see Note 1(k)) . Included within Income (loss) before income taxes within the Consumer Electronics segment for the year ended February 28, 2021 is an intangible asset impairment charge of $ 1,300 (see Note 1(k)). |
Receivables from Vendors - Addi
Receivables from Vendors - Additional Information (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Receivables From Vendors [Abstract] | ||
Nontrade receivables, current | $ 112 | $ 363 |
Equity Investment - Additional
Equity Investment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Income (loss) from equity method investments | $ 6,969 | $ 7,890 | $ 7,350 |
Proceeds from equity method investment, distribution | 6,300 | 9,809 | 6,009 |
Retained earnings, undistributed earnings from equity method investees | 16,692 | 16,022 | |
Related party transaction, other revenues from transactions with related party | 232 | 315 | $ 260 |
Due from affiliate, current | $ 49 | $ 68 | |
ASA Electronics, LLC [Member] | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 50% |
Equity Investment - Equity Meth
Equity Investment - Equity Method Investment, Summarized Financial Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment, Summarized Financial Information, Current Assets | $ 285,021 | $ 330,772 | ||
Equity Method Investment, Summarized Financial Information, Current Liabilities | 153,387 | 204,016 | ||
Equity Method Investment Summarized Financial Information, Equity | 304,591 | 346,102 | $ 376,069 | $ 348,229 |
Equity Method Investment, Summarized Financial Information, Gross Profit (Loss) | 134,299 | 169,478 | 158,547 | |
Equity Method Investment, Summarized Financial Information, Net Income (Loss) | (30,911) | (27,465) | 23,366 | |
ASA Electronics, LLC [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment, Summarized Financial Information, Current Assets | 48,391 | 46,202 | ||
Equity Method Investment, Summarized Financial Information, Noncurrent Assets | 6,525 | 7,382 | ||
Equity Method Investment, Summarized Financial Information, Current Liabilities | 10,880 | 10,888 | ||
Equity Method Investment Summarized Financial Information, Equity | 44,036 | 42,696 | ||
Equity Method Investment, Summarized Financial Information, Revenue | 104,997 | 114,825 | 95,866 | |
Equity Method Investment, Summarized Financial Information, Gross Profit (Loss) | 25,671 | 27,517 | 24,124 | |
Equity Method Investment, Summarized Financial Information, Income (Loss) from Continuing Operations | 13,749 | 15,695 | 12,938 | |
Equity Method Investment, Summarized Financial Information, Net Income (Loss) | $ 13,938 | $ 15,780 | $ 14,700 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Accrued Liabilities, Current [Abstract] | ||
Commissions | $ 623 | $ 934 |
Employee compensation | 15,878 | 17,082 |
Professional fees and accrued settlements | 1,526 | 1,620 |
Future warranty | 5,845 | 4,470 |
Refund liability | 5,181 | 5,469 |
Freight and duty | 7,508 | 10,342 |
Royalties, advertising and other | 5,295 | 14,057 |
Total accrued expenses and other current liabilities | $ 41,856 | $ 53,974 |
Financing Arrangements - Schedu
Financing Arrangements - Schedule of Debt (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 | |
Debt, Long-term and Short-term, Combined Amount | $ 39,194 | $ 13,238 | |
Less: current portion of long-term debt | 500 | 2,406 | |
Long-term debt before debt issuance costs | 38,694 | 10,832 | |
Less: debt issuance costs | 1,181 | 1,046 | |
Total long-term debt | 37,513 | 9,786 | |
Revolving Credit Facility [Member] | |||
Debt, Long-term and Short-term, Combined Amount | [1] | 29,000 | |
Mortgages [Member] | |||
Debt, Long-term and Short-term, Combined Amount | [2] | 6,115 | 6,614 |
Less: debt issuance costs | 93 | ||
Audiovox Germany [Member] | Foreign Line of Credit [Member] | |||
Debt, Long-term and Short-term, Combined Amount | [3] | 1,906 | |
Sharp Corporation [Member] | Shareholder Loan Payable [Member] | |||
Debt, Long-term and Short-term, Combined Amount | [4] | $ 4,079 | $ 4,718 |
[1] The Company has a senior secured credit facility (the “Credit Facility") with Wells Fargo Bank, N.A. (“Wells Fargo”), which was amended on February 15, 2023. The amended Credit Facility provides for an increase in the revolving credit facility with committed availability of up to $ 165,000 and also includes a $ 50,000 sublimit for letters of credit and a $ 15,000 sublimit for Swing Loans. The availability under the revolving credit line within the Credit Facility is subject to a borrowing base, which is based on eligible accounts receivable, eligible inventory and certain real estate, subject to reserves as determined by the lender, and is also limited by amounts outstanding under the Florida Mortgage (see Note 7(b)). The remaining availability under the revolving credit line of the Credit Facility was $ 84,033 as of February 28, 2023. Any amounts outstanding under the Credit Facility will mature and become immediately due on April 19, 2026 ; however, the Credit Facility is subject to acceleration upon the occurrence of an Event of Default (as defined in the Credit Agreement). The Company may prepay any amounts outstanding at any time. Commitments under the Credit Facility may be irrevocably reduced at any time, without premium or penalty as set forth in the Credit Facility. Pursuant to the amendment to the Credit Facility on February 25, 2023 the LIBOR rate previously in place for the revolving credit facility was replaced by the SOFR rate. As of the effective date of the amendment, any outstanding LIBOR rate loans automatically converted to SOFR Loans. Generally, the Company may designate specific borrowings under the Credit Facility as either Base Rate Loans or SOFR Loans, except that Swing Loans may only be designated as Base Rate Loans. Loans under the Credit Facility designated as SOFR Loans shall bear interest at a rate equal to the then-applicable SOFR Rate plus a range of 1.75 % - 2.25 % ( 6.44 % at February 28, 2023 ). Loans under the Credit Facility designated as Base Rate Loans shall bear interest at a rate equal to the applicable margin for Base Rate Loans of 0.75 % - 1.25 %, as defined in the agreement and shall not be lower than 1.75 % ( 8.50 % at February 28, 2023). Provided the Company is in a Compliance Period (the period commencing on the day in which Excess Availability is less than 15 % of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than 15% for any consecutive 30-day period thereafter) , the Credit Facility requires compliance with a financial covenant calculated as of the last day of each month consisting of a Fixed Charge Coverage Ratio. The Credit Facility also contains covenants, subject to defined carveouts, that limit the ability of the loan parties and certain of their subsidiaries which are not loan parties to, among other things: (i) incur additional indebtedness; (ii) incur liens; (iii) merge, consolidate or dispose of a substantial portion of their business; (iv) transfer or dispose of assets; (v) change their name, organizational identification number, state or province of organization or organizational identity; (vi) make any material change in their nature of business; (vii) prepay or otherwise acquire indebtedness; (viii) cause any change of control; (ix) make any restricted junior payment; (x) change their fiscal year or method of accounting; (xi) make advances, loans or investments; (xii) enter into or permit any transaction with an affiliate of any borrower or any of their subsidiaries; (xiii) use proceeds for certain items; (xiv) issue or sell any of their stock; (xv) consign or sell any of their inventory on certain terms. In addition, if excess availability under the Credit Facility were to fall below certain specified levels, as defined in the Credit Facility, the lenders would have the right to assume dominion and control over the Company's cash. As of February 28, 2023, the Company was not in a Compliance Period. The obligations under the Credit Facility are secured by a general lien on, and security interest in, substantially all of the assets of the borrowers and certain of the guarantors, including accounts receivable, equipment, real estate, general intangibles, and inventory. The Company has guaranteed the obligations of the borrowers under the Credit Facility. The Company has deferred financing costs related to the Credit Facility and previous amendments and modifications of the Credit Facility. In conjunction with the amendment to its Credit Facility on February 15, 2023, the Company incurred additional financing fees of $ 398 that will be amortized over the remaining term of the facility. The Company accounted for the February 2023 amendment to the Credit Facility as a modification of debt. Deferred financing costs are included in Long-term debt on the accompanying Consolidated Balance Sheets as a contra-liability balance and are amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the remaining term of the Credit Facility. The Company amortized $ 231 during the year ended February 28, 2023 and $ 241 during both of the years ended February 28, 2022 and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 1,088 . Charges incurred on the unused portion of the Credit Facility and its predecessor revolving credit facility during the years ended February 28, 2023, February 28, 2022, and February 28, 2021 totaled $ 686 , $ 739 , and $ 504 , respectively, and are included within Interest and Bank Charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . On July 6, 2015, VOXX HQ LLC, the Company’s wholly owned subsidiary, closed on a $ 9,995 industrial development revenue tax exempt bond under a loan agreement in favor of the Orange County Industrial Development Authority (the “Authority”) to finance the construction of the Company's manufacturing facility and executive offices in Lake Nona, Florida (the “Construction Loan”). Wells Fargo Bank, N.A. ("Wells Fargo") was the purchaser of the bond and U.S. Bank National Association is the trustee under an Indenture of Trust with the Authority. Voxx borrowed the proceeds of the bond purchase from the Authority during construction as a revolving loan, which converted to a permanent mortgage upon completion of the facility in January 2016 (the "Florida Mortgage"). The Company makes principal and interest payments to Wells Fargo, which began March 1, 2016 and will continue through March of 2026. The Florida Mortgage bears interest at 70 % of 1-month LIBOR plus 1.54 % ( 6.21 % at February 28, 2023) and is secured by a first mortgage on the property, a collateral assignment of leases and rents and a guaranty by the Company. The Company is in compliance with the financial covenants of the Florida Mortgage, which are as defined in the Company’s Credit Facility with Wells Fargo dated April 26, 2016 and amended in April 2021 and February 2023. The amendment to the Credit Facility in April 2021 provided for a Benchmark Replacement that will replace the LIBOR rate for the Florida Mortgage. The Benchmark Replacement is subject to the occurrence of a Benchmark Transition Event, as defined in the Second Amended and Restated Credit Agreement and becomes effective after a five-day transition period following the event. The amendment to the Credit Facility in February 2023 was not deemed a Benchmark Transition Event for the Florida Mortgage and the interest rate in effect for this loan remains referenced to LIBOR at February 28, 2023. The Company incurred debt financing costs totaling approximately $ 332 as a result of obtaining the Florida Mortgage, which are recorded as deferred financing costs and included in Long-term debt as a contra-liability balance on the accompanying Consolidated Balance Sheets and are being amortized through Interest and bank charges in the Consolidated Statements of Operations and Comprehensive (Loss) Income over the ten-year term of the Florida Mortgage. The Company amortized $ 31 of these costs during each of the years ended February 28, 2023, February 28, 2022, and February 28, 2021. The net unamortized balance of these deferred financing costs at February 28, 2023 is $ 93 . On July 20, 2015, the Company entered into an interest rate swap agreement in order to hedge interest rate exposure related to the Florida Mortgage and pays a fixed rate of 3.48 % under the swap agreement (see Note 1(e)). On May 1, 2023, VOXX HQ LLC, a wholly owned subsidiary of the Company, consented to a First Amendment and Supplement to the Indenture of Trust relating to the Florida Industrial Revenue Bonds which were purchased by Wells Fargo N.A., and which provided for a replacement benchmark from LIBOR to SOFR including a modification to the interest rate to 79 % of the applicable SOFR Rate plus 1.87 %. On May 3, 2023, VOXX HQ LLC entered into an Amended and Restated Confirmation of Swap Transaction with Wells Fargo Bank N.A. related to the interest rate swap that hedges the Company's interest rate exposure on the Florida Industrial Revenue Bonds. The swap contract was amended to reference the SOFR Rate, as well as set a new fixed rate equal to 3.43 % Foreign bank obligations include a Euro Asset-Based Lending ("ABL") credit facility, which has a credit limit of € 8,000 , for the Company's subsidiary, VOXX Germany, which expires on July 31, 2023. The rate of interest for the ABL is the three-month Euribor plus 2.30 % ( 5.04 % at February 28, 2023 ). In conjunction with the capitalization and funding of the Company’s Onkyo joint venture with its partner Sharp, which was created in order to execute the acquisition of certain assets of the home audio/video business of OHEC on September 8, 2021 (see Note 2), Onkyo entered into a loan agreement with the shareholders of the joint venture, PAC and Sharp. The loan balance outstanding at February 28, 2023 represents the portion of the loan payable to Sharp. The loan balance due to PAC eliminates in consolidation. All amounts outstanding under the loan will mature and become payable ten years from the execution date of the acquisition, which is September 8, 2031. The loan may be prepaid subject the approval of the board of directors of the joint venture and must be repaid if either the put or call option is exercised in accordance with the joint venture agreement. The rate of interest for the shareholder loan is 2.5 % and the loan is secured by a second priority lien on and secured interest in all assets of Onkyo. |
Financing Arrangements - Sche_2
Financing Arrangements - Schedule of Debt (Parenthethical) (Details) € in Thousands | 12 Months Ended | ||||||||||
May 01, 2023 | Sep. 08, 2021 | Feb. 28, 2023 USD ($) | Feb. 28, 2022 USD ($) | Feb. 28, 2021 USD ($) | May 03, 2023 | Mar. 31, 2020 | Apr. 26, 2016 USD ($) | Jul. 20, 2015 | Jul. 06, 2015 USD ($) | Oct. 23, 2000 EUR (€) | |
Percentage of maximum revolver amount | 15% | ||||||||||
Debt instrument compliance description | Company is in a Compliance Period (the period commencing on the day in which Excess Availability is less than 15% of the Maximum Revolver Amount and ending on a day in which Excess Availability is equal to or greater than 15% for any consecutive 30-day period thereafter) | ||||||||||
Line of credit facility, additional financing fees | $ 398,000 | ||||||||||
Debt issuance costs, net | 1,181,000 | $ 1,046,000 | |||||||||
Amortization of deferred financing costs | 262,000 | 272,000 | $ 623,000 | ||||||||
Line of Credit Facility, Commitment Fee Amount | 686,000 | $ 739,000 | 504,000 | ||||||||
Debt Issuance Costs, Gross | $ 332,000 | ||||||||||
Industrial revenue bond | $ 9,995,000 | ||||||||||
Derivative, Fixed Interest Rate | 3.43% | 3.48% | |||||||||
Mortgage bears interest rate | 70% | ||||||||||
Short-term Debt, Weighted Average Interest Rate, at Point in Time | 3.48% | 2.66% | |||||||||
Interest Expense | $ 2,299,000 | $ 550,000 | 825,000 | ||||||||
Interest Expense, Debt | $ 1,507,000 | 0 | 326,000 | ||||||||
Subsequent Event [Member] | |||||||||||
Derivative, Fixed Interest Rate | 3.43% | ||||||||||
Sharp Corporation [Member] | Shareholder Loan Payable [Member] | Onkyo Home Entertainment Corporation [Member] | |||||||||||
Debt instrument, payable term | 10 years | ||||||||||
Debt instrument, interest rate | 2.50% | ||||||||||
Mortgages [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 1.54% | ||||||||||
Debt instrument, interest rate at period end | 6.21% | ||||||||||
Debt issuance costs, net | $ 93,000 | ||||||||||
Amortization of deferred financing costs | $ 31,000 | 31,000 | 31,000 | ||||||||
SOFR Rate [Member] | |||||||||||
Debt instrument, interest rate at period end | 6.44% | ||||||||||
SOFR Rate [Member] | Subsequent Event [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 1.87% | ||||||||||
Debt instrument, interest rate at period end | 79% | ||||||||||
SOFR Rate [Member] | Minimum [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 1.75% | ||||||||||
SOFR Rate [Member] | Maximum [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 2.25% | ||||||||||
Base Rate [Member] | |||||||||||
Debt instrument, interest rate at period end | 8.50% | ||||||||||
Base Rate [Member] | Minimum [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 0.75% | ||||||||||
Base Rate [Member] | Maximum [Member] | |||||||||||
Debt instrument, basis spread on variable rate | 1.25% | ||||||||||
Debt instrument, interest rate during period | 1.75% | ||||||||||
Wells Fargo [Member] | |||||||||||
Line of credit facility, remaining borrowing capacity | $ 84,033,000 | ||||||||||
Wells Fargo [Member] | Loans [Member] | |||||||||||
Line of credit facility, maximum borrowing capacity | $ 15,000,000 | ||||||||||
Revolving Credit Facility [Member] | |||||||||||
Line of credit facility, maturity date | Apr. 19, 2026 | ||||||||||
Revolving Credit Facility [Member] | Wells Fargo [Member] | |||||||||||
Line of credit facility, current borrowing capacity | 165,000,000 | ||||||||||
Letter of Credit [Member] | Wells Fargo [Member] | |||||||||||
Line of credit facility, maximum borrowing capacity | $ 50,000,000 | ||||||||||
Line of Credit [Member] | |||||||||||
Debt issuance costs, net | $ 1,088,000 | ||||||||||
Amortization of deferred financing costs | $ 231,000 | $ 241,000 | $ 241,000 | ||||||||
Foreign Line of Credit [Member] | Audiovox Germany [Member] | |||||||||||
Line of credit facility, maximum borrowing capacity | € | € 8,000 | ||||||||||
Debt instrument, basis spread on variable rate | 2.30% | ||||||||||
Debt instrument, interest rate at period end | 5.04% |
Financing Arrangements - Sche_3
Financing Arrangements - Schedule of Debt Maturities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Debt Disclosure [Abstract] | ||
Long-term Debt, Current Maturities | $ 500 | |
Long-term Debt, Maturities, Repayments of Principal in Year Two | 500 | |
Long-term Debt, Maturities, Repayments of Principal in Year Three | 500 | |
Long-term Debt, Maturities, Repayments of Principal in Year Four | 33,615 | |
Long-term Debt, Maturities, Repayments of Principal after Year Five | 4,079 | |
Long-term Debt | $ 39,194 | $ 13,238 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income (Loss) Before Provision (Benefit) for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of Income Before Taxes [Abstract] | |||
Domestic Operations | $ (33,501) | $ (26,665) | $ 24,485 |
Foreign Operations | 2,551 | 826 | 3,153 |
Income before provision (benefit) for income taxes | $ (30,950) | $ (25,839) | $ 27,638 |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision (Benefit) for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes Disclosure [Line Items] | |||
Current provision (benefit) | $ 1,744 | $ 2,972 | $ 1,658 |
Deferred (benefit) provision | (1,783) | (1,346) | 2,614 |
Total (benefit) provision | (39) | 1,626 | 4,272 |
Federal [Member] | |||
Income Taxes Disclosure [Line Items] | |||
Current provision (benefit) | 254 | 20 | (10) |
Deferred (benefit) provision | (394) | (2,300) | 3,362 |
Total (benefit) provision | (140) | (2,280) | 3,352 |
State [Member] | |||
Income Taxes Disclosure [Line Items] | |||
Current provision (benefit) | 242 | 804 | 1,172 |
Deferred (benefit) provision | (271) | 1,010 | (84) |
Total (benefit) provision | (29) | 1,814 | 1,088 |
Foreign [Member] | |||
Income Taxes Disclosure [Line Items] | |||
Current provision (benefit) | 1,248 | 2,148 | 496 |
Deferred (benefit) provision | (1,118) | (56) | (664) |
Total (benefit) provision | $ 130 | $ 2,092 | $ (168) |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Tax Rate Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Schedule of Effective Tax Rate Before Income Taxes [Abstract] | |||
Tax benefit at Federal statutory rates, amount | $ (6,499) | $ (5,426) | $ 5,804 |
State income taxes, net of Federal benefit, amount | (711) | (282) | 983 |
Change in valuation allowance, amount | 5,785 | 7,214 | (3,365) |
Change in tax reserves, amount | (173) | (227) | (311) |
Non-controlling interest, amount | 476 | 766 | 714 |
US effects of foreign operations, amount | 379 | (2,135) | 521 |
Permanent differences and other, amount | 794 | 581 | (192) |
Foreign rate differential, amount | 402 | 787 | 412 |
Change in tax rate, amount | 39 | 105 | 102 |
Research & development credits, amount | (531) | 243 | (396) |
Effective tax rate, amount | $ (39) | $ 1,626 | $ 4,272 |
Tax benefit at Federal statutory rates, percent | 21% | 21% | 21% |
State income taxes, net of Federal benefit, percent | 2.30% | 1.10% | 3.50% |
Change in valuation allowance, percent | (18.70%) | (28.00%) | (12.20%) |
Change in tax reserves, percent | 0.50% | 0.90% | (1.10%) |
Non-controlling interest, percent | (1.50%) | (3.00%) | 2.60% |
US effects of foreign operations, percent | (1.20%) | 8.30% | 1.90% |
Permanent differences and other, percent | (2.60%) | (2.20%) | (0.70%) |
Foreign rate differential, percent | (1.30%) | (3.10%) | 1.50% |
Change in tax rate, percent | (0.10%) | (0.40%) | 0.40% |
Research & development credits, percent | 1.70% | (0.90%) | (1.40%) |
Effective tax rate, percent | (0.10%) | (6.30%) | 15.50% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Components of Deferred Tax Assets and Liabilities [Abstract] | ||
Accounts receivable | $ 192 | $ 301 |
Inventory | 4,196 | 4,356 |
Property, plant and equipment | 2,467 | 1,903 |
IRC Section 174 - Capitalized R&D | 3,735 | |
Interim arbitration award | 10,453 | 9,515 |
Operating lease | 811 | 999 |
Accruals and reserves | 6,097 | 5,946 |
Deferred compensation | 268 | 297 |
Warranty reserves | 1,465 | 692 |
Unrealized gains and losses | 4,877 | 4,219 |
Partnership investments | 3,262 | 3,399 |
Net operating losses | 5,270 | 6,278 |
Foreign tax credits | 1,739 | 2,254 |
Other tax credits | 5,344 | 5,220 |
Deferred tax assets before valuation allowance | 50,176 | 45,379 |
Less: valuation allowance | (35,421) | (30,059) |
Total deferred tax assets | 14,755 | 15,320 |
Intangible assets | (16,035) | (17,464) |
Prepaid expenses | (1,513) | (2,079) |
Operating lease | (798) | (977) |
Deferred financing fees | (46) | (60) |
Total deferred tax liabilities | (18,392) | (20,580) |
Net deferred tax liability | $ (3,637) | $ (5,260) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 29, 2024 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Taxes Disclosure [Line Items] | ||||
Valuation allowance increase (decrease) in deferred tax asset | $ (5,362) | |||
Deferred tax assets, Capital loss carryforwards | $ 14,056 | |||
Tax credit carryforward, Description | The Company has various foreign net operating loss carryforwards, state net operating loss carryforwards, and state tax credits that expire in various years and amounts through tax year 2042. | |||
Unrecognized tax benefits that would impact effective tax rate | $ 5,212 | |||
Unrecognized tax benefits, income tax penalties and interest accrued | 966 | $ 198 | ||
Unrecognized tax benefits, income tax penalties and interest expense | (5) | (28) | $ 4 | |
Unrecognized tax benefits, period increase (decrease) | (89) | $ 172 | $ (112) | |
Scenario Forecast [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Unrecognized tax benefits, period increase (decrease) | $ 300 | |||
Settlement with Taxing Authority [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Unrecognized tax benefits that would impact effective tax rate | 5,984 | |||
Unrecognized tax benefits, income tax penalties and interest accrued | $ 194 | |||
Capital Loss Carryforward [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit expiration period | 2024 | |||
Foreign [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit carryforward, amount | $ 986 | |||
Foreign [Member] | Minimum [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit expiration period | 2031 | |||
Foreign [Member] | Maximum [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit expiration period | 2032 | |||
Federal [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Research and Development, Tax credits | $ 3,805 | |||
Federal [Member] | Research and Development [Member] | Minimum [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit expiration period | 2036 | |||
Federal [Member] | Research and Development [Member] | Maximum [Member] | ||||
Income Taxes Disclosure [Line Items] | ||||
Tax credit expiration period | 2042 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Income Tax Disclosure [Abstract] | |||
Beginning balance, unrecognized tax benefits | $ 6,265 | $ 6,860 | $ 7,235 |
Additions based on tax positions taken in the current and prior years | 114 | 140 | 3 |
Settlements | 0 | 0 | 0 |
Decreases based on tax positions taken in the prior years | (484) | (563) | (490) |
Other | 89 | (172) | 112 |
Ending balance, unrecognized tax benefits | $ 5,984 | $ 6,265 | $ 6,860 |
Income Taxes - Schedule of Tax
Income Taxes - Schedule of Tax Returns Subject to Examination by Tax Authorities in Major Jurisdictions (Details) | 12 Months Ended |
Feb. 28, 2023 | |
Tax Year 2016 [Member] | US [Member] | Domestic Tax Authority [Member] | |
Income Tax Examination [Line Items] | |
Tax Year under examination | 2018 |
Tax Year 2015 [Member] | Netherlands [Member] | Foreign [Member] | |
Income Tax Examination [Line Items] | |
Tax Year under examination | 2017 |
Tax Year 2014 [Member] | Germany [Member] | Foreign [Member] | |
Income Tax Examination [Line Items] | |
Tax Year under examination | 2018 |
Capital Structure - Schedule of
Capital Structure - Schedule of Capital Units (Details) - $ / shares | 12 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Capital Unit [Line Items] | ||
Preferred stock, shares outstanding | 0 | 0 |
Preferred Stock [Member] | ||
Capital Unit [Line Items] | ||
Preferred Stock, Par or Stated Value Per Share | $ 50 | |
Preferred Stock, Shares Authorized | 50,000 | 50,000 |
Preferred stock, shares outstanding | 0 | 0 |
Preferred Stock, Liquidation Preference Per Share | $ 50 | |
Series A Preferred Stock [Member] | ||
Capital Unit [Line Items] | ||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | |
Preferred Stock, Shares Authorized | 1,500,000 | 1,500,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common Class A [Member] | ||
Capital Unit [Line Items] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 60,000,000 | 60,000,000 |
Common Stock, Shares, Outstanding | 21,167,527 | 21,614,629 |
Common Stock, Voting Rights | one | |
Common Class B [Member] | ||
Capital Unit [Line Items] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Common Stock, Shares, Outstanding | 2,260,954 | 2,260,954 |
Common Stock, Voting Rights | ten |
Capital Structure - Additional
Capital Structure - Additional Information (Details) $ in Thousands | 12 Months Ended | |||
Feb. 28, 2023 USD ($) shares | Feb. 28, 2022 USD ($) shares | Feb. 28, 2021 shares | Feb. 29, 2020 shares | |
Capital Unit [Line Items] | ||||
Conversion of shares, common stock | 1 | |||
Treasury stock, shares | 3,370,657 | 2,862,218 | ||
Stock repurchase program, number of shares authorized to be repurchased | 3,000,000 | |||
Stock repurchased during period, shares | 0 | |||
Stock repurchased during period, value | $ | $ 5,147 | $ 1,220 | ||
Common Class A [Member] | ||||
Capital Unit [Line Items] | ||||
Treasury stock, shares | 3,370,657 | 2,862,218 | ||
Stock repurchase program, number of shares authorized to be repurchased | 1,797,437 | |||
Stock repurchased during period, shares | 508,439 | 113,000 | ||
Stock repurchased during period, value | $ | $ 5,147 | $ 1,220 |
Other Stock and Retirement Pl_2
Other Stock and Retirement Plans - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Defined Contribution Plan Disclosure [Line Items] | |||
Share-based compensation arrangement by share-based payment award, number of shares available for grant | 1,049,275 | ||
Defined contribution plan, employer discretionary contribution amount | $ 0 | $ 0 | $ 0 |
Deferred compensation arrangement with individual, cash awards granted, percentage of deferred salary | 25% | ||
Deferred compensation arrangement with individual, maximum employer contribution | $ 20 | ||
Matching contributions | 0 | 0 | 0 |
Deferred compensation plan assets | 1,053 | 1,231 | |
Deferred Profit Sharing [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution plan, employer discretionary contribution amount | 685 | 689 | 555 |
Deferred Bonus [Member] | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution plan, employer discretionary contribution amount | $ 0 | $ 0 | $ 0 |
Lease Obligations - Additional
Lease Obligations - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Leases [Line Items] | |||
Short term leases | $ 0 | ||
Other Income (Expense) [Member] | |||
Leases [Line Items] | |||
Rental income | $ 911,000 | $ 678,000 | $ 739,000 |
Minimum [Member] | |||
Leases [Line Items] | |||
Operating and finance leases remaining lease terms | 1 year | ||
Maximum [Member] | |||
Leases [Line Items] | |||
Operating and finance leases remaining lease terms | 8 years |
Lease Obligations - Schedule of
Lease Obligations - Schedule of Components of Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | ||
Leases [Abstract] | ||||
Operating lease cost | [1],[2] | $ 1,508 | $ 1,383 | $ 1,169 |
Finance lease cost: | ||||
Amortization of right of use assets | [2] | 283 | 403 | 596 |
Interest on lease liabilities | [3] | 4 | 11 | 28 |
Total finance lease cost | $ 287 | $ 414 | $ 624 | |
[1] Includes immaterial amounts related to variable rent expense. Recorded within Selling, general, and administrative; Engineering and technical support; and Cost of sales on the Consolidated Statements of Operations and Comprehensive (Loss) Income . Recorded within Interest and bank charges on the Consolidated Statements of Operations and Comprehensive (Loss) Income . |
Lease Obligations - Schedule _2
Lease Obligations - Schedule of Supplemental Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Operating Leases | ||
Operating lease, right of use assets | $ 3,632 | $ 4,464 |
Total operating lease right of use assets | 3,632 | 4,464 |
Accrued expenses and other current liabilities | 1,173 | 1,255 |
Operating lease liabilities, less current portion | 2,509 | 3,298 |
Total operating lease liabilities | 3,682 | 4,553 |
Finance Leases | ||
Property, plant and equipment, gross | 2,754 | 2,503 |
Accumulated depreciation | (2,491) | (2,208) |
Total finance lease right of use assets | $ 263 | $ 295 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property, plant and equipment, net | Property, plant and equipment, net |
Accrued expenses and other current liabilities | $ 203 | $ 224 |
Finance lease liabilities, less current portion | 63 | 78 |
Total finance lease liabilities | $ 266 | $ 302 |
Weighted Average Remaining Lease Term | ||
Operating leases | 5 years | 5 years 6 months |
Finance leases | 1 year 2 months 12 days | 1 year 3 months 18 days |
Weighted Average Discount Rate | ||
Operating leases | 3.83% | 4.01% |
Finance leases | 3.51% | 3.87% |
Lease Obligations - Schedule _3
Lease Obligations - Schedule of Maturities of Leases Liabilities (Details) - USD ($) $ in Thousands | Feb. 28, 2023 | Feb. 28, 2022 |
Operating Leases | ||
2024 | $ 1,269 | |
2025 | 780 | |
2026 | 547 | |
2027 | 374 | |
2028 | 245 | |
Thereafter | 787 | |
Total lease payments | 4,002 | |
Less imputed interest | 320 | |
Total | 3,682 | $ 4,553 |
Finance Leases | ||
2024 | 203 | |
2025 | 64 | |
Total lease payments | 267 | |
Less imputed interest | 1 | |
Total | $ 266 | $ 302 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 USD ($) | Feb. 28, 2022 | Feb. 28, 2021 | |
Financial Instruments [Line Items] | |||
Letters of credit outstanding, amount | $ 0 | ||
Unrecorded unconditional purchase obligation | $ 97,606 | ||
Number of customers | 0 | 0 | |
Concentration risk, benchmark description | 10% | 10% | |
Net Sales [Member] | |||
Financial Instruments [Line Items] | |||
Number of major customer | 5 | 5 | 5 |
Accounts Receivable [Member] | |||
Financial Instruments [Line Items] | |||
Number of major customer | 5 | ||
Consumer Electronics [Member] | Net Sales [Member] | |||
Financial Instruments [Line Items] | |||
Number of major customer | 1 | ||
Customer [Member] | Consumer Electronics [Member] | Net Sales [Member] | |||
Financial Instruments [Line Items] | |||
Entity-wide revenue, major customer, percentage | 12% | ||
Customer [Member] | Largest Customer [Member] | Net Sales [Member] | |||
Financial Instruments [Line Items] | |||
Entity-wide revenue, major customer, percentage | 17% | 21% | 30% |
Customer [Member] | Largest Customer [Member] | Accounts Receivable [Member] | |||
Financial Instruments [Line Items] | |||
Entity-wide revenue, major customer, percentage | 20% | 24% | |
Letter of Credit [Member] | |||
Financial Instruments [Line Items] | |||
Letters of credit outstanding, amount | $ 50 |
Financial and Product Informa_3
Financial and Product Information About Foreign and Domestic Operations - Additional Information (Details) | 12 Months Ended |
Feb. 28, 2023 Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Financial and Product Informa_4
Financial and Product Information About Foreign and Domestic Operations - Schedule of Segment Data from Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | ||||
Segment Reporting Information [Line Items] | ||||||
Net sales | $ 534,014 | $ 635,920 | $ 563,605 | |||
Equity in income of equity investee | 6,969 | 7,890 | 7,350 | |||
Interest expense and bank charges | 4,643 | 2,532 | 2,979 | |||
Depreciation and amortization expense | 13,130 | 12,398 | 11,033 | |||
Income (loss) before income taxes | (30,950) | [1],[2],[3] | (25,839) | [1] | 27,638 | [4] |
Operating Segments [Member] | Automotive Electronics [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 174,811 | 200,594 | 163,903 | |||
Equity in income of equity investee | 6,969 | 7,890 | 7,350 | |||
Interest expense and bank charges | 1,917 | 1,510 | 1,540 | |||
Depreciation and amortization expense | 3,245 | 3,049 | 2,881 | |||
Income (loss) before income taxes | (3,236) | [1],[2],[3] | 8,471 | [1] | 9,608 | [4] |
Operating Segments [Member] | Consumer Electronics [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 357,758 | 433,925 | 398,263 | |||
Equity in income of equity investee | 0 | 0 | 0 | |||
Interest expense and bank charges | 8,033 | 7,827 | 8,537 | |||
Depreciation and amortization expense | 6,534 | 4,957 | 3,856 | |||
Income (loss) before income taxes | (1,101) | [1],[2],[3] | 28,645 | [1] | 38,939 | [4] |
Operating Segments [Member] | Biometrics [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 1,046 | 882 | 836 | |||
Equity in income of equity investee | 0 | 0 | 0 | |||
Interest expense and bank charges | 1,720 | 1,662 | 1,475 | |||
Depreciation and amortization expense | 287 | 297 | 322 | |||
Income (loss) before income taxes | (5,816) | [1],[2],[3] | (9,354) | [1] | (8,726) | [4] |
Corporate, Non-Segment [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 399 | 519 | 603 | |||
Equity in income of equity investee | 0 | 0 | 0 | |||
Interest expense and bank charges | (7,027) | (8,467) | (8,573) | |||
Depreciation and amortization expense | 3,064 | 4,095 | 3,974 | |||
Income (loss) before income taxes | $ (20,797) | [1],[2],[3] | $ (53,601) | [1] | $ (12,183) | [4] |
[1] Included within Income (loss) before income taxes within Corporate/Eliminations for the year ended February 28, 2022 is a charge of $ 39,444 recorded for an interim arbitration award unfavorable to the Company (see Note 15). Included within Loss before income taxes on Corporate/Eliminations for the year ended February 28, 2023 are interest charges of $ 3,944 related to the interim arbitration award. Included within Loss before income taxes within Corporate/Eliminations for the year ended February 28, 2023 are foreign currency losses of $ 3,267 attributable to the Company's Onkyo subsidiary related to intercompany transactions and financial statement translation adjustments. Included within Loss before income taxes within the Automotive Electronics segment for the year ended February 28, 2023 is a goodwill impairment charge of $ 7,373 and an intangible asset impairment charge of $ 1,300 (see Note 1(k)) . Included within Income (loss) before income taxes within the Consumer Electronics segment for the year ended February 28, 2021 is an intangible asset impairment charge of $ 1,300 (see Note 1(k)). |
Financial and Product Informa_5
Financial and Product Information About Foreign and Domestic Operations - Schedule of Segment Data from Continuing Operations (Parenthetical) (Details) - USD ($) | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Segment Reporting Information [Line Items] | |||
Foreign currency losses | $ 3,267,000 | ||
Goodwill, impairment charge | 7,373,000 | $ 0 | $ 0 |
Intangible asset impairment charges | 1,300,000 | 1,300,000 | |
Corporate, Non-Segment [Member] | |||
Segment Reporting Information [Line Items] | |||
Foreign currency losses | 3,267,000 | ||
Charge for interim arbitration award unfavorable | 3,944,000 | 39,444,000 | |
Consumer Electronics [Member] | |||
Segment Reporting Information [Line Items] | |||
Intangible asset impairment charges | 1,300,000 | ||
Automotive Electronics [Member] | |||
Segment Reporting Information [Line Items] | |||
Goodwill, impairment charge | 7,373,000 | $ 0 | $ 0 |
Intangible asset impairment charges | $ 1,300,000 |
Financial and Product Informa_6
Financial and Product Information About Foreign and Domestic Operations - Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales | $ 534,014 | $ 635,920 | $ 563,605 |
Long-lived assets | 47,044 | 49,794 | 52,026 |
UNITED STATES | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales | 421,296 | 506,226 | 477,608 |
Long-lived assets | 41,925 | 44,751 | 46,614 |
Europe [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales | 79,677 | 97,396 | 82,134 |
Long-lived assets | 3,164 | 3,422 | 3,569 |
Non-US [Member] | |||
Revenues From External Customers And Long Lived Assets [Line Items] | |||
Net sales | 33,041 | 32,298 | 3,863 |
Long-lived assets | $ 1,955 | $ 1,621 | $ 1,843 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Feb. 28, 2023 USD ($) Segment | Feb. 28, 2022 USD ($) | |
Disaggregation Of Revenue [Line Items] | ||
Number of reportable segments | Segment | 3 | |
Contract with customer, right to recover product | $ 2,513 | $ 2,619 |
Contract with customer, refund liability | 5,181 | 5,469 |
Contract with customer, liability | 4,818 | $ 5,412 |
Telematic Subscription Services [Member] | Directed LLC and Directed Electronics Canada Inc [Member] | ||
Disaggregation Of Revenue [Line Items] | ||
Contract with customer, liability | $ 4,818 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | |
Disaggregation Of Revenue [Line Items] | |||
Net sales | $ 534,014 | $ 635,920 | $ 563,605 |
Corporate, Non-Segment [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 399 | 519 | 603 |
Automotive [Member] | Operating Segments [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 174,811 | 200,594 | 163,903 |
Automotive [Member] | Operating Segments [Member] | OEM Products [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 72,979 | 65,017 | 46,170 |
Automotive [Member] | Operating Segments [Member] | Aftermarket Products [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 101,832 | 135,577 | 117,733 |
Consumer Electronics [Member] | Operating Segments [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 357,758 | 433,925 | 398,263 |
Consumer Electronics [Member] | Operating Segments [Member] | Premium Audio Products [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 274,544 | 343,991 | 299,908 |
Consumer Electronics [Member] | Operating Segments [Member] | Other Consumer Electronic Products [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 83,214 | 89,934 | 98,355 |
Biometrics [Member] | Operating Segments [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | 1,046 | 882 | 836 |
Biometrics [Member] | Operating Segments [Member] | Biometric Products [Member] | |||
Disaggregation Of Revenue [Line Items] | |||
Net sales | $ 1,046 | $ 882 | $ 836 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Reconciliation of Contract Liabilities (Details) $ in Thousands | 12 Months Ended |
Feb. 28, 2023 USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Balance at February 28, 2022 | $ 5,412 |
Subscription payments received | 6,775 |
Revenue recognized | (7,369) |
Balance at February 28, 2023 | $ 4,818 |
Contingencies - Additional Info
Contingencies - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Mar. 03, 2022 | Nov. 29, 2021 | Jul. 14, 2021 | Jun. 30, 2021 | Feb. 28, 2023 | Feb. 28, 2022 | |
Loss Contingencies [Line Items] | ||||||
Loss contingency, damages awarded, value | $ 39,444 | |||||
Loss contingency, fees and costs | $ 798 | |||||
Arbitration settlement | $ 39,444 | |||||
Interim arbitration award | $ 3,944 | 39,444 | ||||
Accrued balance related to interim award | $ 43,388 | $ 39,444 | ||||
Breach of Contract Claim | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, damages sought, value | $ 40,000 | $ 10,000 | ||||
Loss contingency, damages awarded, value | $ 39,444 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Year | $ 1,108 | $ 1,104 | $ 751 | |
Gross Amount Charged to Costs and Expenses | 5,218 | 6,320 | 6,565 | |
Reversals of Previously Established Accruals | 0 | 0 | 0 | |
Deductions | [1] | 5,209 | 6,316 | 6,212 |
Balance at End of Year | 1,117 | 1,108 | 1,104 | |
Allowance for Credit Losses [Member] | ||||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Year | 2,182 | 1,593 | 1,954 | |
Gross Amount Charged to Costs and Expenses | (717) | 863 | (271) | |
Reversals of Previously Established Accruals | 0 | 0 | 0 | |
Deductions | [1] | 67 | 274 | 90 |
Balance at End of Year | 1,398 | 2,182 | 1,593 | |
Sales Return Reserve [Member] | ||||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||||
Balance at Beginning of Year | 5,469 | 5,145 | 3,779 | |
Gross Amount Charged to Costs and Expenses | 22,659 | 9,571 | 16,550 | |
Reversals of Previously Established Accruals | 0 | 0 | 0 | |
Deductions | [1] | 22,947 | 9,247 | 15,184 |
Balance at End of Year | $ 5,181 | $ 5,469 | $ 5,145 | |
[1] For the allowance for credit losses and cash discount allowances, deductions represent currency effects, chargebacks and payments made or credits issued to customers. |