Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended |
In Thousands, unless otherwise specified | Jun. 28, 2014 |
Document and Entity Information [Abstract] | ' |
Entity Registrant Name | 'SELECT COMFORT CORP |
Entity Central Index Key | '0000827187 |
Current Fiscal Year End Date | '--01-03 |
Entity Filer Category | 'Large Accelerated Filer |
Document Type | '10-Q |
Document Period End Date | 28-Jun-14 |
Document Fiscal Year Focus | '2014 |
Document Fiscal Period Focus | 'Q2 |
Amendment Flag | 'false |
Entity Common Stock, Shares Outstanding | 53,743 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Jun. 28, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $37,107 | $58,223 |
Marketable debt securities – current | 45,831 | 52,159 |
Accounts receivable, net of allowance for doubtful accounts of $478 and $425, respectively | 14,334 | 14,979 |
Inventories | 43,156 | 40,152 |
Prepaid expenses | 12,097 | 9,216 |
Deferred income taxes | 6,910 | 6,936 |
Other current assets | 9,494 | 7,874 |
Total current assets | 168,929 | 189,539 |
Non-current assets: | ' | ' |
Marketable debt securities – non-current | 37,822 | 34,632 |
Property and equipment, net | 151,479 | 129,542 |
Goodwill and intangible assets, net | 16,403 | 16,823 |
Deferred income taxes | 6,953 | 4,943 |
Other assets | 6,831 | 6,286 |
Total assets | 388,417 | 381,765 |
Current liabilities: | ' | ' |
Accounts payable | 59,368 | 73,391 |
Customer prepayments | 18,087 | 15,392 |
Accrued sales returns | 9,194 | 9,433 |
Compensation and benefits | 24,632 | 15,242 |
Taxes and withholding | 11,281 | 12,517 |
Other current liabilities | 11,103 | 11,207 |
Total current liabilities | 133,665 | 137,182 |
Non-current liabilities: | ' | ' |
Warranty liabilities | 1,822 | 1,567 |
Other long-term liabilities | 19,963 | 17,796 |
Total liabilities | 155,450 | 156,545 |
Shareholders’ equity: | ' | ' |
Undesignated preferred stock; 5,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 142,500 shares authorized, 53,743 and 54,901 shares issued and outstanding, respectively | 537 | 549 |
Additional paid-in capital | 0 | 5,382 |
Retained earnings | 232,387 | 219,276 |
Accumulated other comprehensive income | 43 | 13 |
Total shareholders’ equity | 232,967 | 225,220 |
Total liabilities and shareholders’ equity | $388,417 | $381,765 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jun. 28, 2014 | Dec. 28, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Current assets: | ' | ' |
Allowance for Doubtful Accounts Receivable, Current | $478 | $425 |
Shareholders’ equity: | ' | ' |
Undesignated preferred stock, shares authorized (in shares) | 5,000 | 5,000 |
Undesignated preferred stock, shares issued (in shares) | 0 | 0 |
Undesignated preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized (in shares) | 142,500 | 142,500 |
Common stock, shares issued (in shares) | 53,743 | 54,901 |
Common stock, shares outstanding (in shares) | 53,743 | 54,901 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Income Statement [Abstract] | ' | ' | ' | ' |
Net sales | $234,763 | $207,391 | $511,175 | $465,628 |
Cost of sales | 92,366 | 75,993 | 197,395 | 170,814 |
Gross profit | 142,397 | 131,398 | 313,780 | 294,814 |
Operating expenses: | ' | ' | ' | ' |
Sales and marketing | 106,712 | 98,357 | 231,734 | 208,170 |
General and administrative | 21,265 | 15,374 | 40,161 | 31,194 |
Research and development | 1,709 | 2,560 | 3,372 | 5,116 |
Total operating expenses | 129,686 | 116,291 | 275,267 | 244,480 |
Operating income | 12,711 | 15,107 | 38,513 | 50,334 |
Other income, net | 78 | 78 | 180 | 169 |
Income before income taxes | 12,789 | 15,185 | 38,693 | 50,503 |
Income tax expense | 4,308 | 5,259 | 13,220 | 17,106 |
Net income | $8,481 | $9,926 | $25,473 | $33,397 |
Basic net income per share: | ' | ' | ' | ' |
Net income per share – basic (in USD per share) | $0.16 | $0.18 | $0.47 | $0.61 |
Weighted-average shares – basic (in shares) | 53,648 | 55,029 | 53,880 | 55,062 |
Diluted net income per share: | ' | ' | ' | ' |
Net income per share – diluted (in USD per share) | $0.16 | $0.18 | $0.47 | $0.60 |
Weighted-average shares – diluted (in shares) | 54,324 | 55,987 | 54,570 | 56,101 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $8,481 | $9,926 | $25,473 | $33,397 |
Other comprehensive income (loss) – unrealized gain (loss) on available-for-sale marketable debt securities, net of income tax | 20 | -38 | 30 | -45 |
Comprehensive income | $8,501 | $9,888 | $25,503 | $33,352 |
Consolidated_Statement_of_Shar
Consolidated Statement of Shareholders' Equity (USD $) | Total | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] |
In Thousands, unless otherwise specified | |||||
Balance at Dec. 28, 2013 | $225,220 | $549 | $5,382 | $219,276 | $13 |
Balance (in shares) at Dec. 28, 2013 | 54,901 | 54,901 | ' | ' | ' |
Net income | 25,473 | 0 | 0 | 25,473 | 0 |
Other comprehensive income: | ' | ' | ' | ' | ' |
Unrealized gain on available-for-sale marketable debt securities, net of tax | 30 | 0 | 0 | 0 | 30 |
Exercise of common stock options | 1,366 | 0 | 1,366 | 0 | 0 |
Exercise of common stock options (in shares) | ' | 101 | ' | ' | ' |
Tax effect from stock-based compensation | 313 | 0 | 313 | 0 | 0 |
Stock-based compensation | 2,035 | 0 | 2,035 | 0 | 0 |
Stock-based compensation (in shares) | ' | -84 | ' | ' | ' |
Repurchases of common stock | -21,470 | -12 | -9,096 | -12,362 | 0 |
Repurchases of common stock (in shares) | ' | -1,175 | ' | ' | ' |
Balance at Jun. 28, 2014 | $232,967 | $537 | $0 | $232,387 | $43 |
Balance (in shares) at Jun. 28, 2014 | 53,743 | 53,743 | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 |
Cash flows from operating activities: | ' | ' |
Net income | $25,473 | $33,397 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 19,213 | 14,153 |
Stock-based compensation | 2,035 | 1,992 |
Net loss (gain) on disposals and impairments of assets | 87 | -58 |
Excess tax benefits from stock-based compensation | -720 | -2,837 |
Deferred income taxes | -2,003 | 4,072 |
Changes in operating assets and liabilities, net of effect of acquisition: | ' | ' |
Accounts receivable | 651 | 2,541 |
Inventories | -3,004 | 1,769 |
Income taxes | -394 | -3,084 |
Prepaid expenses and other assets | -4,355 | -3,933 |
Accounts payable | -1,042 | -1,708 |
Customer prepayments | 2,695 | -2,857 |
Accrued compensation and benefits | 9,724 | -4,802 |
Other taxes and withholding | -529 | -1,156 |
Warranty liabilities | 281 | -571 |
Other accruals and liabilities | 1,466 | -775 |
Net cash provided by operating activities | 49,578 | 36,143 |
Cash flows from investing activities: | ' | ' |
Purchases of property and equipment | -39,766 | -37,096 |
Proceeds from maturities of marketable debt securities | 23,548 | 23,463 |
Investments in marketable debt securities | -28,405 | -16,504 |
Increase in restricted cash | 500 | 0 |
Proceeds from sales of property and equipment | 5 | 117 |
Acquisition of business | 0 | -15,500 |
Investment in non-marketable equity securities | 0 | -3,000 |
Net cash used in investing activities | -45,118 | -48,520 |
Cash flows from financing activities: | ' | ' |
Repurchases of common stock | -21,470 | -22,031 |
Net decrease in short-term borrowings | -6,192 | -4,750 |
Proceeds from issuance of common stock | 1,366 | 6,595 |
Excess tax benefits from stock-based compensation | 720 | 2,837 |
Net cash used in financing activities | -25,576 | -17,349 |
Net decrease in cash and cash equivalents | -21,116 | -29,726 |
Cash and cash equivalents, at beginning of period | 58,223 | 87,915 |
Cash and cash equivalents, at end of period | $37,107 | $58,189 |
Basis_of_Presentation
Basis of Presentation | 6 Months Ended |
Jun. 28, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
We prepared the condensed consolidated financial statements as of and for the three and six months ended June 28, 2014 of Select Comfort Corporation and 100%-owned subsidiaries (“Select Comfort” or the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and they reflect, in the opinion of management, all normal recurring adjustments necessary to present fairly our financial position as of June 28, 2014, and December 28, 2013, and the consolidated results of operations and cash flows for the periods presented. Our historical and quarterly consolidated results of operations may not be indicative of the results that may be achieved for the full year or any future period. | |
Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with our most recent audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 28, 2013 and other recent filings with the SEC. | |
The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of sales, expenses and income taxes during the reporting period. Predicting future events is inherently an imprecise activity and, as such, requires the use of judgment. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates will be reflected in the financial statements in future periods. Our critical accounting policies consist of stock-based compensation, asset impairment charges, goodwill and indefinite-lived intangible assets, warranty liabilities and revenue recognition. | |
The consolidated financial statements include the accounts of Select Comfort Corporation and our 100%-owned subsidiaries. All significant intra-entity balances and transactions have been eliminated in consolidation. | |
New Accounting Pronouncements | |
In May 2014, the Financial Accounting Standards Board issued a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, we will adopt this new guidance beginning in fiscal 2017. Companies may use either a full retrospective or a modified retrospective approach to adopt this new guidance and management is currently evaluating which transition approach to use. Management does not expect this new guidance to materially impact our consolidated results of operations, financial position or cash flows. |
Fair_Value_Measurements
Fair Value Measurements | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||
The following tables set forth, by level within the fair value hierarchy, our financial assets that were accounted for at fair value on a recurring basis according to the valuation techniques we used to determine their fair value (in thousands): | |||||||||||||||||
June 28, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Marketable debt securities – current | |||||||||||||||||
U.S. Treasury securities | $ | 7,505 | $ | — | $ | — | $ | 7,505 | |||||||||
Corporate bonds | — | 22,851 | — | 22,851 | |||||||||||||
U.S. Agency bonds | — | 9,508 | — | 9,508 | |||||||||||||
Municipal bonds | — | 5,967 | — | 5,967 | |||||||||||||
7,505 | 38,326 | — | 45,831 | ||||||||||||||
Marketable debt securities – non-current | |||||||||||||||||
U.S. Treasury securities | 16,494 | — | — | 16,494 | |||||||||||||
Corporate bonds | — | 7,640 | — | 7,640 | |||||||||||||
U.S. Agency bonds | — | 10,005 | — | 10,005 | |||||||||||||
Municipal bonds | — | 3,683 | — | 3,683 | |||||||||||||
16,494 | 21,328 | — | 37,822 | ||||||||||||||
$ | 23,999 | $ | 59,654 | $ | — | $ | 83,653 | ||||||||||
December 28, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Marketable debt securities – current | |||||||||||||||||
U.S. Treasury securities | $ | 15,011 | $ | — | $ | — | $ | 15,011 | |||||||||
Corporate bonds | — | 20,300 | — | 20,300 | |||||||||||||
U.S. Agency bonds | — | 12,025 | — | 12,025 | |||||||||||||
Municipal bonds | — | 4,823 | — | 4,823 | |||||||||||||
15,011 | 37,148 | — | 52,159 | ||||||||||||||
Marketable debt securities – non-current | |||||||||||||||||
U.S. Treasury securities | 8,978 | — | — | 8,978 | |||||||||||||
Corporate bonds | — | 15,484 | — | 15,484 | |||||||||||||
U.S. Agency bonds | — | 7,498 | — | 7,498 | |||||||||||||
Municipal bonds | — | 2,672 | — | 2,672 | |||||||||||||
8,978 | 25,654 | — | 34,632 | ||||||||||||||
$ | 23,989 | $ | 62,802 | $ | — | $ | 86,791 | ||||||||||
We did not have any transfers between Level 1 and Level 2 fair value measurements during the periods presented. | |||||||||||||||||
At June 28, 2014 and December 28, 2013, we had $1.1 million and $1.1 million, respectively, of debt and equity securities that funded our deferred compensation plan and are classified in other assets in our condensed consolidated balance sheets. We also had corresponding deferred compensation plan liabilities of $1.1 million and $1.1 million at June 28, 2014 and December 28, 2013, respectively, which are included in other long-term liabilities in our condensed consolidated balance sheets. The majority of the debt and equity securities are Level 1 as they trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis. Unrealized gains/(losses) on the debt and equity securities offset those associated with the corresponding deferred compensation plan liabilities. |
Investments
Investments | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Investments [Abstract] | ' | |||||||||||||||
Investments | ' | |||||||||||||||
Marketable Debt Securities | ||||||||||||||||
Investments in marketable debt securities were comprised of the following (in thousands): | ||||||||||||||||
June 28, 2014 | ||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
U.S. Treasury securities | $ | 23,978 | $ | 24 | $ | (3 | ) | $ | 23,999 | |||||||
Corporate bonds | 30,476 | 17 | (2 | ) | 30,491 | |||||||||||
U.S. Agency bonds | 19,505 | 12 | (4 | ) | 19,513 | |||||||||||
Municipal bonds | 9,623 | 27 | — | 9,650 | ||||||||||||
$ | 83,582 | $ | 80 | $ | (9 | ) | $ | 83,653 | ||||||||
December 28, 2013 | ||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
U.S. Treasury securities | $ | 23,975 | $ | 15 | $ | (1 | ) | $ | 23,989 | |||||||
Corporate bonds | 35,804 | 3 | (23 | ) | 35,784 | |||||||||||
U.S. Agency bonds | 19,517 | 10 | (4 | ) | 19,523 | |||||||||||
Municipal bonds | 7,474 | 23 | (2 | ) | 7,495 | |||||||||||
$ | 86,770 | $ | 51 | $ | (30 | ) | $ | 86,791 | ||||||||
Maturities of marketable debt securities were as follows (in thousands): | ||||||||||||||||
June 28, 2014 | December 28, 2013 | |||||||||||||||
Amortized | Fair | Amortized | Fair | |||||||||||||
Cost | Value | Cost | Value | |||||||||||||
Marketable debt securities – current (due in less than one year) | $ | 45,791 | $ | 45,831 | $ | 52,122 | $ | 52,159 | ||||||||
Marketable debt securities – non-current (due in one to two years) | 37,791 | 37,822 | 34,648 | 34,632 | ||||||||||||
$ | 83,582 | $ | 83,653 | $ | 86,770 | $ | 86,791 | |||||||||
During the three months ended June 28, 2014 and June 29, 2013, respectively, $13.5 million and $17.5 million of marketable debt securities matured and were redeemed at face value. During the six months ended June 28, 2014 and June 29, 2013, respectively, $23.5 million and $23.3 million of marketable debt securities matured and were redeemed at face value. During the six months ended June 28, 2014, there were no other-than-temporary declines in market value. | ||||||||||||||||
Other Investments | ||||||||||||||||
During 2013, we made a minority equity investment in one of our strategic product-development partners. The carrying value of this investment at June 28, 2014 and December 28, 2013 using the cost method is $4.5 million and is included in other assets on our condensed consolidated balance sheets. |
Inventories
Inventories | 6 Months Ended | |||||||
Jun. 28, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories consisted of the following (in thousands): | ||||||||
June 28, | December 28, | |||||||
2014 | 2013 | |||||||
Raw materials | $ | 8,475 | $ | 7,118 | ||||
Work in progress | 202 | 505 | ||||||
Finished goods | 34,479 | 32,529 | ||||||
$ | 43,156 | $ | 40,152 | |||||
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||
Goodwill and Intangible Assets | ' | |||||||||||||||
Goodwill and Intangible Assets | ||||||||||||||||
Goodwill and Indefinite-Lived Intangible Assets | ||||||||||||||||
The following is a roll forward of goodwill and indefinite-lived trade name/trademarks (in thousands): | ||||||||||||||||
Six Months Ended | Six Months Ended | |||||||||||||||
June 28, 2014 | June 29, 2013 | |||||||||||||||
Goodwill | Indefinite-Lived | Goodwill | Indefinite-Lived | |||||||||||||
Trade Name/ | Trade Name/ | |||||||||||||||
Trademarks | Trademarks | |||||||||||||||
Beginning balance | $ | 8,963 | $ | 1,396 | $ | 2,850 | $ | — | ||||||||
Comfortaire purchase(1) | — | — | 6,157 | 1,396 | ||||||||||||
Ending balance | $ | 8,963 | $ | 1,396 | $ | 9,007 | $ | 1,396 | ||||||||
(1) Comfortaire purchase includes goodwill and indefinite-lived trade name/trademarks resulting from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. | ||||||||||||||||
Definite-Lived Intangible Assets | ||||||||||||||||
The following table provides the gross carrying amount and related accumulated amortization of our definite-lived intangible assets (in thousands): | ||||||||||||||||
June 28, 2014 | December 28, 2013 | |||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | |||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||
Developed technologies | $ | 5,231 | $ | 1,097 | $ | 5,231 | $ | 850 | ||||||||
Customer relationships | 2,413 | 503 | 2,413 | 330 | ||||||||||||
Trade names/trademarks | 101 | 101 | 101 | 101 | ||||||||||||
$ | 7,745 | $ | 1,701 | $ | 7,745 | $ | 1,281 | |||||||||
Amortization expense for definite-lived intangible assets was $0.2 million and $0.4 million, for the three and six months ended June 28, 2014, respectively, and $0.3 million and $0.4 million, for the three and six months ended June 29, 2013, respectively. |
Credit_Agreement
Credit Agreement | 6 Months Ended |
Jun. 28, 2014 | |
Debt Disclosure [Abstract] | ' |
Debt | ' |
Our $20.0 million Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, National Association, as amended, is an unsecured revolving credit facility that matures on August 31, 2016. The Credit Agreement contains an accordion feature that allows us to increase the amount of the line from $20.0 million to up to $50.0 million in total availability, subject to lender approval. | |
Any borrowings under the Credit Agreement will, at our request, be classified as either LIBOR Loans or Adjusted Base Rate (“ABR”) Loans (both as defined in the Credit Agreement). The rate of interest payable by us in respect of loans outstanding under the revolving credit facility is: (i) with respect to LIBOR Loans, the Adjusted LIBO Rate (as defined in the Credit Agreement) for the interest period then in effect, plus 1.25%; or (ii) with respect to ABR Loans, the ABR (as defined in the Credit Agreement) then in effect for the Daily One-Month LIBO Rate (as defined in the Credit Agreement), plus 1.50%, or the prime rate. We are subject to certain financial covenants under the Credit Agreement, including minimum tangible net worth, a requirement to maintain a minimum amount of cash, cash equivalents and marketable debt securities, and to maintain at the administrative agent cash, cash equivalents and marketable debt securities equal to the amount the lenders are committed to lend under the Credit Agreement. | |
At both June 28, 2014, and December 28, 2013, $20.0 million was available under the Credit Agreement, we had no borrowings and we were in compliance with all financial covenants. We had no outstanding letters of credit as of June 28, 2014 or December 28, 2013. |
Repurchase_of_Common_Stock
Repurchase of Common Stock | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Repurchase of Common Stock [Abstract] | ' | ||||||||||||||||
Repurchase of Common Stock | ' | ||||||||||||||||
Repurchase of Common Stock | |||||||||||||||||
Repurchases of our common stock were as follows (in thousands): | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 28, 2014 | June 29, 2013 | 28-Jun-14 | 29-Jun-13 | ||||||||||||||
Amount repurchased under Board-approved share repurchase program | $ | 10,011 | $ | 10,009 | $ | 20,022 | $ | 20,018 | |||||||||
Amount repurchased in connection with the vesting of employee restricted stock grants | 1,223 | 1,878 | 1,448 | 2,013 | |||||||||||||
Total amount repurchased | $ | 11,234 | $ | 11,887 | $ | 21,470 | $ | 22,031 | |||||||||
As of June 28, 2014, the remaining authorization under our Board of Directors ("Board") approved share repurchase program was $116.7 million. There is no expiration date governing the period over which we can repurchase shares. Any repurchased shares are constructively retired and returned to an unissued status. | |||||||||||||||||
The cost of stock repurchases is first charged to additional paid-in-capital. Once additional paid-in capital is reduced to zero, any additional amounts are charged to retained earnings. |
StockBased_Compensation
Stock-Based Compensation | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
Stock-Based Compensation | |||||||||||||||||
We compensate officers, directors and key employees with stock-based compensation under two stock plans approved by our shareholders in 2004 and 2010 and administered under the supervision of our Board. Compensation expense, net of estimated forfeitures, is recognized ratably over the vesting period. | |||||||||||||||||
Stock-based compensation expense consisted of the following (in thousands): | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
28-Jun-14 | 29-Jun-13 | June 28, 2014 | June 29, 2013 | ||||||||||||||
Options | $ | 694 | $ | 732 | $ | 929 | $ | 1,277 | |||||||||
Restricted shares | 1,449 | 828 | 1,106 | 715 | |||||||||||||
Total stock-based compensation expense(1) | 2,143 | 1,560 | 2,035 | 1,992 | |||||||||||||
Income tax benefit | (722 | ) | (537 | ) | (696 | ) | (685 | ) | |||||||||
Total stock-based compensation expense, net of tax | $ | 1,421 | $ | 1,023 | $ | 1,339 | $ | 1,307 | |||||||||
(1) The six months ended June 28, 2014 includes a $1.2 million benefit related to a change in estimated forfeitures due to employee turnover during the three months ended March 29, 2014. |
Employee_Benefits
Employee Benefits | 6 Months Ended |
Jun. 28, 2014 | |
Profit Sharing and 401 (k) Plan [Abstract] | ' |
Employee Benefits | ' |
Employee Benefits | |
Under our profit sharing and 401(k) plan, eligible employees may defer up to 50% of their compensation on a pre-tax basis, subject to Internal Revenue Service limitations. Each calendar quarter, we may make a discretionary contribution equal to a percentage of the employee’s contribution. During the three months ended June 28, 2014 and June 29, 2013 our contributions, net of forfeitures, were $0.9 million and $0.8 million, respectively. During the six months ended June 28, 2014 and June 29, 2013 our contributions, net of forfeitures, were $1.8 million and $1.5 million, respectively. |
Other_Income_Net
Other Income, Net | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Other Income and Expenses [Abstract] | ' | |||||||||||||||
Other Income, Net | ' | |||||||||||||||
Other Income, Net | ||||||||||||||||
Other income, net, consisted of the following (in thousands): | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 28, | June 29, | June 28, | June 29, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Interest income | $ | 88 | $ | 91 | $ | 200 | $ | 196 | ||||||||
Interest expense | (10 | ) | (13 | ) | (20 | ) | (27 | ) | ||||||||
Other income, net | $ | 78 | $ | 78 | $ | 180 | $ | 169 | ||||||||
Net_Income_Per_Common_Share
Net Income Per Common Share | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Net Income per Common Share | ' | |||||||||||||||
Net Income per Common Share | ||||||||||||||||
The following computations reconcile net income per share – basic with net income per share – diluted (in thousands, except per share amounts): | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 28, | June 29, | June 28, | June 29, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Net income | $ | 8,481 | $ | 9,926 | $ | 25,473 | $ | 33,397 | ||||||||
Reconciliation of weighted-average shares outstanding: | ||||||||||||||||
Basic weighted-average shares outstanding | 53,648 | 55,029 | 53,880 | 55,062 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Options | 365 | 539 | 359 | 613 | ||||||||||||
Restricted shares | 311 | 419 | 331 | 426 | ||||||||||||
Diluted weighted-average shares outstanding | 54,324 | 55,987 | 54,570 | 56,101 | ||||||||||||
Net income per share – basic | $ | 0.16 | $ | 0.18 | $ | 0.47 | $ | 0.61 | ||||||||
Net income per share – diluted | $ | 0.16 | $ | 0.18 | $ | 0.47 | $ | 0.6 | ||||||||
Additional potentially dilutive stock options totaling 0.8 million and 1.3 million for the three months ended June 28, 2014 and June 29, 2013, respectively, and 0.9 million and 1.3 million for the six months ended June 28, 2014 and June 29, 2013, respectively, have been excluded from our diluted net income per share calculations because these securities’ exercise prices were anti-dilutive (e.g., greater than the average market price of our common stock). |
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended | |||||||
Jun. 28, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Commitments and Contingencies | ' | |||||||
Commitments and Contingencies | ||||||||
Sales Returns | ||||||||
The accrued sales returns estimate is based on historical return rates, which are reasonably consistent from period to period, and is adjusted for any current trends as appropriate. If actual returns vary from expected rates, sales in future periods are adjusted. | ||||||||
The activity in the sales returns liability account was as follows (in thousands): | ||||||||
Six Months Ended | ||||||||
June 28, | June 29, | |||||||
2014 | 2013 | |||||||
Balance at beginning of year | $ | 9,433 | $ | 5,330 | ||||
Additions that reduce net sales | 32,923 | 23,388 | ||||||
Deductions from reserves | (33,162 | ) | (22,963 | ) | ||||
Acquired sales return reserve(1) | — | 50 | ||||||
Balance at end of period | $ | 9,194 | $ | 5,805 | ||||
(1) Acquired sales return reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. | ||||||||
Warranty Liabilities | ||||||||
We provide a 25-year limited warranty on our beds. The customer participates over the last 23 years of the warranty period by paying a portion of the retail value of replacement parts. The estimated warranty costs, which are expensed at the time of sale and included in cost of sales, are based on historical trends and warranty claims rates incurred by us and are adjusted for any current trends as appropriate. Actual warranty claim costs could differ from these estimates. We regularly assess and adjust the estimate of accrued warranty claims by updating claims rates for actual trends and projected claim costs. | ||||||||
The activity in the accrued warranty liabilities account was as follows (in thousands): | ||||||||
Six Months Ended | ||||||||
June 28, | June 29, | |||||||
2014 | 2013 | |||||||
Balance at beginning of year | $ | 4,153 | $ | 4,858 | ||||
Additions charged to costs and expenses for current-year sales | 3,237 | 2,113 | ||||||
Deductions from reserves | (3,231 | ) | (2,568 | ) | ||||
Changes in liability for pre-existing warranties during the current year, including expirations | 274 | (117 | ) | |||||
Acquired warranty reserve(1) | — | 658 | ||||||
Balance at end of period | $ | 4,433 | $ | 4,944 | ||||
(1) Acquired warranty reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. | ||||||||
Legal Proceedings | ||||||||
We are involved from time to time in various legal proceedings arising in the ordinary course of our business, including primarily commercial, product liability, employment and intellectual property claims. In accordance with generally accepted accounting principles in the United States, we record a liability in our consolidated financial statements with respect to any of these matters when it is both probable that a liability has been incurred and the amount of the liability can be reasonably estimated. With respect to currently pending legal proceedings, we have not established an estimated range of reasonably possible additional losses either because we believe that we have valid defenses to claims asserted against us or the proceeding has not advanced to a stage of discovery that would enable us to establish an estimate. We currently do not expect the outcome of these matters to have a material effect on our consolidated results of operations, financial position or cash flows. Litigation, however, is inherently unpredictable, and it is possible that the ultimate outcome of one or more claims asserted against us could adversely impact our consolidated results of operations, financial position or cash flows. We expense legal costs as incurred. | ||||||||
On August 23, 2013, we filed a complaint in U.S. District Court in the District of Minnesota against Gentherm, Inc. seeking a declaratory judgment that Select Comfort be named as an assignee of certain patents asserted against Select Comfort by Gentherm or in the alternative that the asserted patents are not enforceable or are invalid or that Select Comfort and its products do not infringe any valid claim of the asserted patents. This complaint was filed after Gentherm asserted in a letter that Select Comfort’s recently introduced DualTemp™ layer product infringed certain patents owned by Gentherm. Subsequently, Gentherm filed counterclaims alleging infringement of its patents and seeking various legal and equitable remedies, including injunctive relief, treble damages and attorney’s fees. We believe the claims asserted by Gentherm are without merit, and we intend to vigorously pursue our claims and defend the claims asserted by Gentherm. |
Basis_of_Presentation_Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 28, 2014 | |
Accounting Policies [Abstract] | ' |
Business and Basis of Presentation, Policy | ' |
We prepared the condensed consolidated financial statements as of and for the three and six months ended June 28, 2014 of Select Comfort Corporation and 100%-owned subsidiaries (“Select Comfort” or the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and they reflect, in the opinion of management, all normal recurring adjustments necessary to present fairly our financial position as of June 28, 2014, and December 28, 2013, and the consolidated results of operations and cash flows for the periods presented. Our historical and quarterly consolidated results of operations may not be indicative of the results that may be achieved for the full year or any future period. | |
Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with our most recent audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 28, 2013 and other recent filings with the SEC. | |
Use of Estimates, Policy | ' |
The preparation of consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of sales, expenses and income taxes during the reporting period. Predicting future events is inherently an imprecise activity and, as such, requires the use of judgment. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates will be reflected in the financial statements in future periods. Our critical accounting policies consist of stock-based compensation, asset impairment charges, goodwill and indefinite-lived intangible assets, warranty liabilities and revenue recognition. | |
Consolidation, Policy | ' |
The consolidated financial statements include the accounts of Select Comfort Corporation and our 100%-owned subsidiaries. All significant intra-entity balances and transactions have been eliminated in consolidation. | |
New Accounting Pronouncements, Policy | ' |
In May 2014, the Financial Accounting Standards Board issued a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. This new guidance is effective for annual reporting periods beginning after December 15, 2016 and early adoption is not permitted. Accordingly, we will adopt this new guidance beginning in fiscal 2017. Companies may use either a full retrospective or a modified retrospective approach to adopt this new guidance and management is currently evaluating which transition approach to use. Management does not expect this new guidance to materially impact our consolidated results of operations, financial position or cash flows. | |
Stockholders' Equity, Policy [Policy Text Block] | ' |
The cost of stock repurchases is first charged to additional paid-in-capital. Once additional paid-in capital is reduced to zero, any additional amounts are charged to retained earnings. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Assets and Liabilities that are Measured at Fair Value on a Recurring Basis | ' | ||||||||||||||||
The following tables set forth, by level within the fair value hierarchy, our financial assets that were accounted for at fair value on a recurring basis according to the valuation techniques we used to determine their fair value (in thousands): | |||||||||||||||||
June 28, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Marketable debt securities – current | |||||||||||||||||
U.S. Treasury securities | $ | 7,505 | $ | — | $ | — | $ | 7,505 | |||||||||
Corporate bonds | — | 22,851 | — | 22,851 | |||||||||||||
U.S. Agency bonds | — | 9,508 | — | 9,508 | |||||||||||||
Municipal bonds | — | 5,967 | — | 5,967 | |||||||||||||
7,505 | 38,326 | — | 45,831 | ||||||||||||||
Marketable debt securities – non-current | |||||||||||||||||
U.S. Treasury securities | 16,494 | — | — | 16,494 | |||||||||||||
Corporate bonds | — | 7,640 | — | 7,640 | |||||||||||||
U.S. Agency bonds | — | 10,005 | — | 10,005 | |||||||||||||
Municipal bonds | — | 3,683 | — | 3,683 | |||||||||||||
16,494 | 21,328 | — | 37,822 | ||||||||||||||
$ | 23,999 | $ | 59,654 | $ | — | $ | 83,653 | ||||||||||
December 28, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Marketable debt securities – current | |||||||||||||||||
U.S. Treasury securities | $ | 15,011 | $ | — | $ | — | $ | 15,011 | |||||||||
Corporate bonds | — | 20,300 | — | 20,300 | |||||||||||||
U.S. Agency bonds | — | 12,025 | — | 12,025 | |||||||||||||
Municipal bonds | — | 4,823 | — | 4,823 | |||||||||||||
15,011 | 37,148 | — | 52,159 | ||||||||||||||
Marketable debt securities – non-current | |||||||||||||||||
U.S. Treasury securities | 8,978 | — | — | 8,978 | |||||||||||||
Corporate bonds | — | 15,484 | — | 15,484 | |||||||||||||
U.S. Agency bonds | — | 7,498 | — | 7,498 | |||||||||||||
Municipal bonds | — | 2,672 | — | 2,672 | |||||||||||||
8,978 | 25,654 | — | 34,632 | ||||||||||||||
$ | 23,989 | $ | 62,802 | $ | — | $ | 86,791 | ||||||||||
Investments_Tables
Investments (Tables) | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Investments [Abstract] | ' | |||||||||||||||
Investments in marketable debt securities | ' | |||||||||||||||
Investments in marketable debt securities were comprised of the following (in thousands): | ||||||||||||||||
June 28, 2014 | ||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
U.S. Treasury securities | $ | 23,978 | $ | 24 | $ | (3 | ) | $ | 23,999 | |||||||
Corporate bonds | 30,476 | 17 | (2 | ) | 30,491 | |||||||||||
U.S. Agency bonds | 19,505 | 12 | (4 | ) | 19,513 | |||||||||||
Municipal bonds | 9,623 | 27 | — | 9,650 | ||||||||||||
$ | 83,582 | $ | 80 | $ | (9 | ) | $ | 83,653 | ||||||||
December 28, 2013 | ||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | |||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
U.S. Treasury securities | $ | 23,975 | $ | 15 | $ | (1 | ) | $ | 23,989 | |||||||
Corporate bonds | 35,804 | 3 | (23 | ) | 35,784 | |||||||||||
U.S. Agency bonds | 19,517 | 10 | (4 | ) | 19,523 | |||||||||||
Municipal bonds | 7,474 | 23 | (2 | ) | 7,495 | |||||||||||
$ | 86,770 | $ | 51 | $ | (30 | ) | $ | 86,791 | ||||||||
Maturities of marketable debt securities | ' | |||||||||||||||
Maturities of marketable debt securities were as follows (in thousands): | ||||||||||||||||
June 28, 2014 | December 28, 2013 | |||||||||||||||
Amortized | Fair | Amortized | Fair | |||||||||||||
Cost | Value | Cost | Value | |||||||||||||
Marketable debt securities – current (due in less than one year) | $ | 45,791 | $ | 45,831 | $ | 52,122 | $ | 52,159 | ||||||||
Marketable debt securities – non-current (due in one to two years) | 37,791 | 37,822 | 34,648 | 34,632 | ||||||||||||
$ | 83,582 | $ | 83,653 | $ | 86,770 | $ | 86,791 | |||||||||
Inventories_Tables
Inventories (Tables) | 6 Months Ended | |||||||
Jun. 28, 2014 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories consisted of the following (in thousands): | ||||||||
June 28, | December 28, | |||||||
2014 | 2013 | |||||||
Raw materials | $ | 8,475 | $ | 7,118 | ||||
Work in progress | 202 | 505 | ||||||
Finished goods | 34,479 | 32,529 | ||||||
$ | 43,156 | $ | 40,152 | |||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||
Goodwill and Indefinite-Lived Intangible Assets | ' | |||||||||||||||
The following is a roll forward of goodwill and indefinite-lived trade name/trademarks (in thousands): | ||||||||||||||||
Six Months Ended | Six Months Ended | |||||||||||||||
June 28, 2014 | June 29, 2013 | |||||||||||||||
Goodwill | Indefinite-Lived | Goodwill | Indefinite-Lived | |||||||||||||
Trade Name/ | Trade Name/ | |||||||||||||||
Trademarks | Trademarks | |||||||||||||||
Beginning balance | $ | 8,963 | $ | 1,396 | $ | 2,850 | $ | — | ||||||||
Comfortaire purchase(1) | — | — | 6,157 | 1,396 | ||||||||||||
Ending balance | $ | 8,963 | $ | 1,396 | $ | 9,007 | $ | 1,396 | ||||||||
Definite-Lived Intangible Assets | ' | |||||||||||||||
The following table provides the gross carrying amount and related accumulated amortization of our definite-lived intangible assets (in thousands): | ||||||||||||||||
June 28, 2014 | December 28, 2013 | |||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | |||||||||||||
Amount | Amortization | Amount | Amortization | |||||||||||||
Developed technologies | $ | 5,231 | $ | 1,097 | $ | 5,231 | $ | 850 | ||||||||
Customer relationships | 2,413 | 503 | 2,413 | 330 | ||||||||||||
Trade names/trademarks | 101 | 101 | 101 | 101 | ||||||||||||
$ | 7,745 | $ | 1,701 | $ | 7,745 | $ | 1,281 | |||||||||
Repurchase_of_Common_Stock_Tab
Repurchase of Common Stock (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Repurchase of Common Stock [Abstract] | ' | ||||||||||||||||
Repurchase of Common Stock | ' | ||||||||||||||||
Repurchases of our common stock were as follows (in thousands): | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 28, 2014 | June 29, 2013 | 28-Jun-14 | 29-Jun-13 | ||||||||||||||
Amount repurchased under Board-approved share repurchase program | $ | 10,011 | $ | 10,009 | $ | 20,022 | $ | 20,018 | |||||||||
Amount repurchased in connection with the vesting of employee restricted stock grants | 1,223 | 1,878 | 1,448 | 2,013 | |||||||||||||
Total amount repurchased | $ | 11,234 | $ | 11,887 | $ | 21,470 | $ | 22,031 | |||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 6 Months Ended | ||||||||||||||||
Jun. 28, 2014 | |||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
Stock-based compensation expense consisted of the following (in thousands): | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
28-Jun-14 | 29-Jun-13 | June 28, 2014 | June 29, 2013 | ||||||||||||||
Options | $ | 694 | $ | 732 | $ | 929 | $ | 1,277 | |||||||||
Restricted shares | 1,449 | 828 | 1,106 | 715 | |||||||||||||
Total stock-based compensation expense(1) | 2,143 | 1,560 | 2,035 | 1,992 | |||||||||||||
Income tax benefit | (722 | ) | (537 | ) | (696 | ) | (685 | ) | |||||||||
Total stock-based compensation expense, net of tax | $ | 1,421 | $ | 1,023 | $ | 1,339 | $ | 1,307 | |||||||||
(1) The six months ended June 28, 2014 includes a $1.2 million benefit related to a change in estimated forfeitures due to employee turnover during the three months ended March 29, 2014. |
Other_Income_Net_Tables
Other Income, Net (Tables) | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Other Income and Expenses [Abstract] | ' | |||||||||||||||
Other Income, Net | ' | |||||||||||||||
Other income, net, consisted of the following (in thousands): | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 28, | June 29, | June 28, | June 29, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Interest income | $ | 88 | $ | 91 | $ | 200 | $ | 196 | ||||||||
Interest expense | (10 | ) | (13 | ) | (20 | ) | (27 | ) | ||||||||
Other income, net | $ | 78 | $ | 78 | $ | 180 | $ | 169 | ||||||||
Net_Income_Per_Common_Share_Ta
Net Income Per Common Share (Tables) | 6 Months Ended | |||||||||||||||
Jun. 28, 2014 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Net Income per Common Share | ' | |||||||||||||||
The following computations reconcile net income per share – basic with net income per share – diluted (in thousands, except per share amounts): | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 28, | June 29, | June 28, | June 29, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Net income | $ | 8,481 | $ | 9,926 | $ | 25,473 | $ | 33,397 | ||||||||
Reconciliation of weighted-average shares outstanding: | ||||||||||||||||
Basic weighted-average shares outstanding | 53,648 | 55,029 | 53,880 | 55,062 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||||
Options | 365 | 539 | 359 | 613 | ||||||||||||
Restricted shares | 311 | 419 | 331 | 426 | ||||||||||||
Diluted weighted-average shares outstanding | 54,324 | 55,987 | 54,570 | 56,101 | ||||||||||||
Net income per share – basic | $ | 0.16 | $ | 0.18 | $ | 0.47 | $ | 0.61 | ||||||||
Net income per share – diluted | $ | 0.16 | $ | 0.18 | $ | 0.47 | $ | 0.6 | ||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 6 Months Ended | |||||||
Jun. 28, 2014 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||||||
Sales Returns | ' | |||||||
The activity in the sales returns liability account was as follows (in thousands): | ||||||||
Six Months Ended | ||||||||
June 28, | June 29, | |||||||
2014 | 2013 | |||||||
Balance at beginning of year | $ | 9,433 | $ | 5,330 | ||||
Additions that reduce net sales | 32,923 | 23,388 | ||||||
Deductions from reserves | (33,162 | ) | (22,963 | ) | ||||
Acquired sales return reserve(1) | — | 50 | ||||||
Balance at end of period | $ | 9,194 | $ | 5,805 | ||||
(1) Acquired sales return reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. | ||||||||
Warranty Liabilities | ' | |||||||
The activity in the accrued warranty liabilities account was as follows (in thousands): | ||||||||
Six Months Ended | ||||||||
June 28, | June 29, | |||||||
2014 | 2013 | |||||||
Balance at beginning of year | $ | 4,153 | $ | 4,858 | ||||
Additions charged to costs and expenses for current-year sales | 3,237 | 2,113 | ||||||
Deductions from reserves | (3,231 | ) | (2,568 | ) | ||||
Changes in liability for pre-existing warranties during the current year, including expirations | 274 | (117 | ) | |||||
Acquired warranty reserve(1) | — | 658 | ||||||
Balance at end of period | $ | 4,433 | $ | 4,944 | ||||
(1) Acquired warranty reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (Recurring [Member], USD $) | Jun. 28, 2014 | Dec. 28, 2013 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | $45,831,000 | $52,159,000 |
Marketable debt securities - noncurrent | 37,822,000 | 34,632,000 |
Marketable debt securities | 83,653,000 | 86,791,000 |
Deferred compensation plan liability | 1,100,000 | 1,100,000 |
Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 7,505,000 | 15,011,000 |
Marketable debt securities - noncurrent | 16,494,000 | 8,978,000 |
Marketable debt securities | 23,999,000 | 23,989,000 |
Marketable securities assets funding the deferred compensation plan | 1,100,000 | 1,100,000 |
Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 38,326,000 | 37,148,000 |
Marketable debt securities - noncurrent | 21,328,000 | 25,654,000 |
Marketable debt securities | 59,654,000 | 62,802,000 |
Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
Marketable debt securities | 0 | 0 |
US Treasury Securities [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 7,505,000 | 15,011,000 |
Marketable debt securities - noncurrent | 16,494,000 | 8,978,000 |
US Treasury Securities [Member] | Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 7,505,000 | 15,011,000 |
Marketable debt securities - noncurrent | 16,494,000 | 8,978,000 |
US Treasury Securities [Member] | Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
US Treasury Securities [Member] | Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
Corporate bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 22,851,000 | 20,300,000 |
Marketable debt securities - noncurrent | 7,640,000 | 15,484,000 |
Corporate bonds [Member] | Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
Corporate bonds [Member] | Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 22,851,000 | 20,300,000 |
Marketable debt securities - noncurrent | 7,640,000 | 15,484,000 |
Corporate bonds [Member] | Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
U.S. Agency bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 9,508,000 | 12,025,000 |
Marketable debt securities - noncurrent | 10,005,000 | 7,498,000 |
U.S. Agency bonds [Member] | Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
U.S. Agency bonds [Member] | Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 9,508,000 | 12,025,000 |
Marketable debt securities - noncurrent | 10,005,000 | 7,498,000 |
U.S. Agency bonds [Member] | Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
Municipal bonds [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 5,967,000 | 4,823,000 |
Marketable debt securities - noncurrent | 3,683,000 | 2,672,000 |
Municipal bonds [Member] | Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | 0 | 0 |
Municipal bonds [Member] | Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 5,967,000 | 4,823,000 |
Marketable debt securities - noncurrent | 3,683,000 | 2,672,000 |
Municipal bonds [Member] | Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Marketable debt securities - current | 0 | 0 |
Marketable debt securities - noncurrent | $0 | $0 |
Investments_Marketable_Debt_Se
Investments - Marketable Debt Securities (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 | Dec. 28, 2013 | |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' |
Proceeds from maturity of marketable debt securities | $13,500,000 | $17,500,000 | $23,500,000 | $23,300,000 | ' |
Investments of marketable debt securities [Abstract] | ' | ' | ' | ' | ' |
Amortized cost | 83,582,000 | ' | 83,582,000 | ' | 86,770,000 |
Unrealized gains | 80,000 | ' | 80,000 | ' | 51,000 |
Unrealized losses | -9,000 | ' | -9,000 | ' | -30,000 |
Fair value | 83,653,000 | ' | 83,653,000 | ' | 86,791,000 |
Amortized Cost [Abstract] | ' | ' | ' | ' | ' |
Marketable debt securities - current (due in less than one year) | 45,791,000 | ' | 45,791,000 | ' | 52,122,000 |
Marketable debt securities - non-current (due in one to two years) | 37,791,000 | ' | 37,791,000 | ' | 34,648,000 |
Marketable debt securities Total Amortized Cost | 83,582,000 | ' | 83,582,000 | ' | 86,770,000 |
Fair Value [Abstract] | ' | ' | ' | ' | ' |
Marketable debt securities - current (due in less than one year) | 45,831,000 | ' | 45,831,000 | ' | 52,159,000 |
Marketable debt securities - non-current (due in one to two years) | 37,822,000 | ' | 37,822,000 | ' | 34,632,000 |
Marketable Debt Securities Total Fair value | 83,653,000 | ' | 83,653,000 | ' | 86,791,000 |
U.S. Treasury securities [Member] | ' | ' | ' | ' | ' |
Investments of marketable debt securities [Abstract] | ' | ' | ' | ' | ' |
Amortized cost | 23,978,000 | ' | 23,978,000 | ' | 23,975,000 |
Unrealized gains | 24,000 | ' | 24,000 | ' | 15,000 |
Unrealized losses | -3,000 | ' | -3,000 | ' | -1,000 |
Fair value | 23,999,000 | ' | 23,999,000 | ' | 23,989,000 |
Corporate bonds [Member] | ' | ' | ' | ' | ' |
Investments of marketable debt securities [Abstract] | ' | ' | ' | ' | ' |
Amortized cost | 30,476,000 | ' | 30,476,000 | ' | 35,804,000 |
Unrealized gains | 17,000 | ' | 17,000 | ' | 3,000 |
Unrealized losses | -2,000 | ' | -2,000 | ' | -23,000 |
Fair value | 30,491,000 | ' | 30,491,000 | ' | 35,784,000 |
U.S. Agency bonds [Member] | ' | ' | ' | ' | ' |
Investments of marketable debt securities [Abstract] | ' | ' | ' | ' | ' |
Amortized cost | 19,505,000 | ' | 19,505,000 | ' | 19,517,000 |
Unrealized gains | 12,000 | ' | 12,000 | ' | 10,000 |
Unrealized losses | -4,000 | ' | -4,000 | ' | -4,000 |
Fair value | 19,513,000 | ' | 19,513,000 | ' | 19,523,000 |
Municipal bonds [Member] | ' | ' | ' | ' | ' |
Investments of marketable debt securities [Abstract] | ' | ' | ' | ' | ' |
Amortized cost | 9,623,000 | ' | 9,623,000 | ' | 7,474,000 |
Unrealized gains | 27,000 | ' | 27,000 | ' | 23,000 |
Unrealized losses | 0 | ' | 0 | ' | -2,000 |
Fair value | $9,650,000 | ' | $9,650,000 | ' | $7,495,000 |
Investments_Other_Investments_
Investments - Other Investments (Details) (USD $) | Jun. 28, 2014 | Dec. 28, 2013 |
In Millions, unless otherwise specified | ||
Investments - Other Investments (Details) [Abstract] | ' | ' |
Cost Method Investments | $4.50 | $4.50 |
Inventories_Details
Inventories (Details) (USD $) | Jun. 28, 2014 | Dec. 28, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Raw materials | $8,475 | $7,118 |
Work in progress | 202 | 505 |
Finished goods | 34,479 | 32,529 |
Inventories | $43,156 | $40,152 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets Goodwill and Indefinite-Lived Intangible Assets (Details) (USD $) | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | |
Goodwill [Roll Forward] | ' | ' | |
Beginning balance | $8,963 | $2,850 | |
Comfortaire purchase | 0 | 6,157 | [1] |
Ending balance | 8,963 | 9,007 | |
Indefinite-Lived Intangible Assets [Roll Forward] | ' | ' | |
Beginning balance | 1,396 | 0 | |
Indefinite-lived Intangible Assets Acquired | 0 | 1,396 | [1] |
Ending balance | $1,396 | $1,396 | |
[1] | (1) Comfortaire purchase includes goodwill and indefinite-lived trade name/trademarks resulting from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets Finite-Lived Intangible Assets (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 | Dec. 28, 2013 | |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Amortization of Intangible Assets | $200,000 | $300,000 | $400,000 | $400,000 | ' |
Finite-Lived Intangible Assets | 7,745,000 | ' | 7,745,000 | ' | 7,745,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | 1,701,000 | ' | 1,701,000 | ' | 1,281,000 |
Developed technologies [Member] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets | 5,231,000 | ' | 5,231,000 | ' | 5,231,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | 1,097,000 | ' | 1,097,000 | ' | 850,000 |
Customer Relationships [Member] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets | 2,413,000 | ' | 2,413,000 | ' | 2,413,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | 503,000 | ' | 503,000 | ' | 330,000 |
TradenameAndTrademark [Member] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' |
Finite-Lived Intangible Assets | 101,000 | ' | 101,000 | ' | 101,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $101,000 | ' | $101,000 | ' | $101,000 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets Amortization Expense (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' |
Amortization of Intangible Assets | $0.20 | $0.30 | $0.40 | $0.40 |
Credit_Agreement_Details
Credit Agreement (Details) (Amended Credit Facility, Wells Fargo Bank [Member], USD $) | 6 Months Ended | |
Jun. 28, 2014 | Dec. 28, 2013 | |
Amended Credit Facility, Wells Fargo Bank [Member] | ' | ' |
Line of Credit Facility [Line Items] | ' | ' |
Current borrowing capacity | $20,000,000 | ' |
Line of Credit Facility Amended Expiration Date | 31-Aug-16 | ' |
Maximum borrowing capacity | 50,000,000 | ' |
Adjusted LIBO Rate basis (in hundredths) | 1.25% | ' |
Adjusted Base Rate - Daily One-Month LIBO Rate basis (in hundredths) | 1.50% | ' |
Available remaining borrowing capacity | 20,000,000 | 20,000,000 |
Outstanding letters of credit | $0 | $0 |
Repurchase_of_Common_Stock_Det
Repurchase of Common Stock (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 | |
Repurchase of Common Stock [Abstract] | ' | ' | ' | ' |
Amount repurchased under Board-approved share repurchase program | $10,011,000 | $10,009,000 | $20,022,000 | $20,018,000 |
Stock Repurchase Acquired Through Tax Withholding Restricted Stock | 1,223,000 | 1,878,000 | 1,448,000 | 2,013,000 |
Total amount repurchased | 11,234,000 | 11,887,000 | 21,470,000 | 22,031,000 |
Remaining Authorized Amount, Stock Repurchase Program | ' | ' | $116,700,000 | ' |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 | ||
stock_plan | |||||
Number of stock plans approved by shareholders | ' | ' | 2 | ' | |
Total stock-based compensation expense(1) | $2,143,000 | $1,560,000 | $2,035,000 | [1] | $1,992,000 |
Income tax benefit | -722,000 | -537,000 | -696,000 | -685,000 | |
Total stock-based compensation expense, net of tax | 1,421,000 | 1,023,000 | 1,339,000 | 1,307,000 | |
Employee Service Share-based Compensation, Expense (Benefit) of Change in Forfeiture Rate | ' | ' | -1,200,000 | ' | |
Stock Options [Member] | ' | ' | ' | ' | |
Total stock-based compensation expense(1) | 694,000 | 732,000 | 929,000 | 1,277,000 | |
Time-Based Stock Awards And Performance Stock Awards [Member] | ' | ' | ' | ' | |
Total stock-based compensation expense(1) | $1,449,000 | $828,000 | $1,106,000 | $715,000 | |
[1] | The six months ended June 28, 2014 includes a $1.2 million benefit related to a change in estimated forfeitures due to employee turnover during the three months ended March 29, 2014. |
Employee_Benefits_Details
Employee Benefits (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Millions, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Profit Sharing and 401 (k) Plan [Abstract] | ' | ' | ' | ' |
Employee compensation deferral (in hundredths) | ' | ' | 50.00% | ' |
Employer contributions | $0.90 | $0.80 | $1.80 | $1.50 |
Other_Income_Net_Details
Other Income, Net (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Other Income and Expenses [Abstract] | ' | ' | ' | ' |
Interest income | $88 | $91 | $200 | $196 |
Interest expense | -10 | -13 | -20 | -27 |
Other income, net | $78 | $78 | $180 | $169 |
Net_Income_per_Common_Share_De
Net Income per Common Share (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | Jun. 28, 2014 | Jun. 29, 2013 |
Reconciliation of Net Income per Common Share [Line Items] | ' | ' | ' | ' |
Net income | $8,481 | $9,926 | $25,473 | $33,397 |
Basic weighted-average shares outstanding | 53,648,000 | 55,029,000 | 53,880,000 | 55,062,000 |
Diluted weighted-average shares outstanding | 54,324,000 | 55,987,000 | 54,570,000 | 56,101,000 |
Net income per share – basic (in USD per share) | $0.16 | $0.18 | $0.47 | $0.61 |
Net income per share – diluted (in USD per share) | $0.16 | $0.18 | $0.47 | $0.60 |
Stock Options [Member] | ' | ' | ' | ' |
Reconciliation of Net Income per Common Share [Line Items] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 800,000 | 1,300,000 | 900,000 | 1,300,000 |
Stock Options [Member] | ' | ' | ' | ' |
Reconciliation of Net Income per Common Share [Line Items] | ' | ' | ' | ' |
Effect of dilutive securities | 365,000 | 539,000 | 359,000 | 613,000 |
Restricted Stock [Member] | ' | ' | ' | ' |
Reconciliation of Net Income per Common Share [Line Items] | ' | ' | ' | ' |
Effect of dilutive securities | 311,000 | 419,000 | 331,000 | 426,000 |
Commitments_and_Contingencies_1
Commitments and Contingencies Sales Return Liability (Details) (USD $) | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | |
Sales return liability [Roll Forward] | ' | ' | |
Balance at beginning of year | $9,433 | $5,330 | |
Additions that reduce net sales | 32,923 | 23,388 | |
Deductions from reserves | -33,162 | -22,963 | |
Acquired sales return reserve(1) | 0 | 50 | [1] |
Balance at end of period | $9,194 | $5,805 | |
[1] | Acquired sales return reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. |
Commitments_and_Contingencies_2
Commitments and Contingencies Warranty Liabilities (Details) (USD $) | 6 Months Ended | ||
In Thousands, unless otherwise specified | Jun. 28, 2014 | Jun. 29, 2013 | |
Warranty Liabilities [Abstract] | ' | ' | |
Limited warranty period (in years) | '25 years | ' | |
Customer participation term (in years) | '23 years | ' | |
Warranty Liabilities [Roll Forward] | ' | ' | |
Balance at beginning of year | $4,153 | $4,858 | |
Additions charged to costs and expenses for current-year sales | 3,237 | 2,113 | |
Deductions from reserves | -3,231 | -2,568 | |
Changes in liability for pre-existing warranties during the current year, including expirations | 274 | -117 | |
Acquired warranty reserve(1) | 0 | 658 | [1] |
Balance at end of period | $4,433 | $4,944 | |
[1] | Acquired warranty reserve resulted from the acquisition of Comfortaire Corporation in the first quarter of fiscal 2013. |