Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2016 | Apr. 29, 2016 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | LFVN | |
Entity Registrant Name | Lifevantage Corp | |
Entity Central Index Key | 849,146 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 14,008,252 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2016 | Jun. 30, 2015 |
Current assets | ||
Cash and cash equivalents | $ 8,494 | $ 13,905 |
Accounts receivable | 2,042 | 1,031 |
Income tax receivable | 2,226 | 2,179 |
Inventory | 17,002 | 9,248 |
Current deferred income tax asset | 1,086 | 1,117 |
Prepaid expenses and deposits | 4,855 | 2,995 |
Total current assets | 35,705 | 30,475 |
Long-term assets | ||
Property and equipment, net | 4,981 | 5,759 |
Intangible assets, net | 1,778 | 1,879 |
Long-term deferred income tax asset | 229 | 235 |
Other long-term assets | 1,427 | 1,433 |
TOTAL ASSETS | 44,120 | 39,781 |
Current liabilities | ||
Accounts payable | 5,938 | 2,614 |
Commissions payable | 8,291 | 6,505 |
Other accrued expenses | 9,067 | 5,600 |
Current portion of long-term debt | 2,000 | 11,141 |
Total current liabilities | 25,296 | 25,860 |
Long-term liabilities | ||
Principal amount | 8,000 | 10,484 |
Less: unamortized discount and deferred offering costs | (99) | (1,951) |
Long-term debt, net of unamortized discount and deferred offering costs | 7,901 | 8,533 |
Other long-term liabilities | 2,084 | 2,063 |
Total liabilities | $ 35,281 | $ 36,456 |
Commitments and contingencies - Note 6 | ||
Stockholders’ equity | ||
Preferred stock — par value $0.001 per share, 50,000 shares authorized, no shares issued or outstanding | $ 0 | $ 0 |
Common stock — par value $0.001 per share, 250,000 shares authorized and 14,008 and 13,958 issued and outstanding as of March 31, 2016 and June 30, 2015, respectively | 14 | 14 |
Additional paid-in capital | 119,374 | 117,657 |
Accumulated deficit | (110,426) | (114,095) |
Accumulated other comprehensive loss | (123) | (251) |
Total stockholders’ equity | 8,839 | 3,325 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 44,120 | $ 39,781 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2016 | Jun. 30, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 14,008,000 | 13,958,000 |
Common stock, shares outstanding (in shares) | 14,008,000 | 13,958,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement [Abstract] | ||||
Revenue, net | $ 56,160 | $ 45,155 | $ 153,507 | $ 145,035 |
Cost of sales | 9,714 | 7,552 | 24,531 | 20,717 |
Gross profit | 46,446 | 37,603 | 128,976 | 124,318 |
Operating expenses: | ||||
Commissions and incentives | 28,185 | 21,637 | 77,525 | 69,406 |
Selling, general and administrative | 14,630 | 14,481 | 42,117 | 42,572 |
Total operating expenses | 42,815 | 36,118 | 119,642 | 111,978 |
Operating income | 3,631 | 1,485 | 9,334 | 12,340 |
Other income (expense): | ||||
Interest expense | (1,808) | (748) | (3,176) | (2,341) |
Other income (expense), net | (46) | (13) | (256) | (56) |
Total other income (expense) | (1,854) | (761) | (3,432) | (2,397) |
Income before income taxes | 1,777 | 724 | 5,902 | 9,943 |
Income tax expense | (774) | (151) | (2,233) | (3,182) |
Net income | $ 1,003 | $ 573 | $ 3,669 | $ 6,761 |
Net income per share: | ||||
Basic (USD per share) | $ 0.07 | $ 0.04 | $ 0.27 | $ 0.48 |
Diluted (USD per share) | $ 0.07 | $ 0.04 | $ 0.26 | $ 0.47 |
Weighted-average shares outstanding: | ||||
Basic ( in shares) | 13,734 | 13,724 | 13,721 | 13,969 |
Diluted (in shares) | 14,128 | 13,961 | 14,072 | 14,256 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment | $ 102 | $ 1 | $ 128 | $ (78) |
Other comprehensive income (loss), net of tax | 102 | 1 | 128 | (78) |
Comprehensive income | $ 1,105 | $ 574 | $ 3,797 | $ 6,683 |
Condensed Consolidated Stateme5
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - 9 months ended Mar. 31, 2016 - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning Balance (in shares) at Jun. 30, 2015 | 13,958 | ||||
Beginning Balance at Jun. 30, 2015 | $ 3,325 | $ 14 | $ 117,657 | $ (114,095) | $ (251) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 1,249 | 1,249 | |||
Exercise of options and warrants (in shares) | 22 | ||||
Exercise of options and warrants | 468 | 468 | |||
Issuance of shares related to restricted stock (in shares) | 76 | ||||
Shares canceled or surrendered as payment of tax withholding (in shares) | (48) | ||||
Currency translation adjustment | 128 | 128 | |||
Net income | 3,669 | 3,669 | |||
Ending Balance (in shares) at Mar. 31, 2016 | 14,008 | ||||
Ending Balance at Mar. 31, 2016 | $ 8,839 | $ 14 | $ 119,374 | $ (110,426) | $ (123) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash Flows from Operating Activities: | ||
Net income | $ 3,669 | $ 6,761 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,424 | 1,738 |
Stock-based compensation | 1,577 | 1,505 |
Amortization of deferred financing fees | 229 | 189 |
Amortization of debt discount | 178 | 147 |
Write-off of capitalized debt transaction costs pursuant to debt refinance | 1,544 | 0 |
Deferred income tax | 37 | 0 |
Changes in operating assets and liabilities: | ||
(Increase) / decrease in receivables | (1,006) | 1,130 |
Increase in inventory | (7,683) | (2,502) |
Decrease in prepaid expenses and deposits | 570 | 793 |
Decrease in long-term assets | 250 | 813 |
Increase / (decrease) in accounts payable | 737 | (67) |
Increase / (decrease) in accrued expenses | 3,955 | (1,488) |
Increase / (decrease) in other long-term liabilities | 717 | (58) |
Net Cash Provided by Operating Activities | 6,198 | 8,961 |
Cash Flows from Investing Activities: | ||
Purchase of equipment | (499) | (1,103) |
Net Cash Used in Investing Activities | (499) | (1,103) |
Cash Flows from Financing Activities: | ||
Proceeds from term loan | 10,000 | 0 |
Payment of deferred financing fees | (99) | 0 |
Excess tax benefit from stock-based compensation | 361 | 148 |
Repurchase of company stock | 0 | (9,850) |
Payment on term loan | (21,625) | (3,525) |
Exercise of options and warrants | 108 | 428 |
Net Cash Used in Financing Activities | (11,255) | (12,799) |
Foreign Currency Effect on Cash | 145 | (93) |
Decrease in Cash and Cash Equivalents: | (5,411) | (5,034) |
Cash and Cash Equivalents — beginning of period | 13,905 | 20,387 |
Cash and Cash Equivalents — end of period | 8,494 | 15,353 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for interest | 1,216 | 2,004 |
Cash paid for income taxes | $ 1,373 | $ 1,816 |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation LifeVantage Corporation is a company dedicated to helping people achieve their health, wellness and financial independence goals. We provide quality, scientifically-validated products and a financially rewarding direct sales business opportunity to customers and independent distributors who seek a healthy lifestyle and financial freedom. We sell our products to preferred customers, retail customers and independent distributors located in the United States, Japan, Hong Kong, Australia, Canada, Philippines, Mexico, Thailand and the United Kingdom. We engage in the identification, research, development and distribution of advanced nutraceutical dietary supplements and skin care products, including Protandim ® , our scientifically-validated dietary supplement, LifeVantage TrueScience ® , our line of anti-aging skin care products, Canine Health ® , our companion pet supplement formulated to combat oxidative stress in dogs, Axio ® , our energy drink mixes, and PhysIQ ™ , our smart weight management system. The condensed consolidated financial statements included herein have been prepared by the Company’s management, without audit, pursuant to the rules and regulations of the SEC. In the opinion of the Company’s management, these interim Financial Statements include all adjustments, consisting of normal recurring adjustments, that are considered necessary for a fair presentation of its financial position as of March 31, 2016 , and the results of operations for the three and nine months ended March 31, 2016 and 2015 and the cash flows for the nine months ended March 31, 2016 and 2015 . Interim results are not necessarily indicative of results for a full year or for any future period. Certain amounts in the prior year financial statements have been reclassified for comparative purposes in order to conform with current year presentation. The condensed consolidated financial statements and notes included herein are presented as required by Form 10-Q, and do not contain certain information included in the Company’s audited financial statements and notes for the fiscal year ended June 30, 2015 pursuant to the rules and regulations of the SEC. For further information, refer to the financial statements and notes thereto as of and for the year ended June 30, 2015 , and included in the Annual Report on Form 10-K on file with the SEC. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. Use of Estimates We prepare our consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (GAAP). In preparing these statements, we are required to use estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. On an ongoing basis, we review our estimates, including those related to inventory valuation and obsolescence, sales returns, income taxes and tax valuation reserves, share-based compensation, and loss contingencies. Translation of Foreign Currency Statements A portion of the Company’s business operations occurs outside the United States. The local currency of each of the Company’s subsidiaries is generally its functional currency. All assets and liabilities are translated into U.S. dollars at exchange rates existing at the balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ equity is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ equity in the condensed consolidated balance sheets and as a component of comprehensive income. Transaction gains and losses and currency translation gains and losses on intercompany balances denominated in a foreign currency are included in other income (expense), net in the condensed consolidated statements of operations and comprehensive income. For the three months ended March 31, 2016 and 2015 , a net foreign currency gain of $0.2 million and a net foreign currency loss of $0.1 million , respectively, are recorded in other income (expense), net. For the nine months ended March 31, 2016 and 2015 , net foreign currency losses of $22,000 and $0.4 million , respectively, are recorded in other income (expense), net. Derivative Instruments and Hedging Activities The Company's subsidiaries enter into transactions with each other which may not be denominated in the respective subsidiaries' functional currencies. The Company seeks to reduce its exposure to fluctuations in foreign exchange rates through the use of derivatives. The Company does not use such derivative financial instruments for trading or speculative purposes. To hedge risks associated with the foreign-currency-denominated intercompany transactions, the Company entered into forward foreign exchange contracts which were settled in March 2016 and were not designated for hedge accounting. For the three months ended March 31, 2016 and 2015 , realized losses of $0.2 million and $0.1 million , respectively, related to forward contracts, are recorded in other income (expense), net. For the nine months ended March 31, 2016 and 2015 , a realized loss of $0.2 million and a gain of of $0.3 million , respectively, related to forward contracts, are recorded in other income (expense), net. The Company did not hold any derivative instruments at March 31, 2016 . Cash and Cash Equivalents The Company considers only its monetary liquid assets with original maturities of three months or less as cash and cash equivalents. Concentration of Credit Risk Accounting guidance for financial instruments requires disclosure of significant concentrations of credit risk regardless of the degree of such risk. Financial instruments with significant credit risk include cash and investments. At March 31, 2016 , the Company had $4.2 million in cash accounts that were held primarily at one financial institution and $4.3 million in accounts at other financial institutions. As of March 31, 2016 and June 30, 2015 , and during the periods then ended, the Company’s cash balances exceeded federally insured limits. Accounts Receivable The Company’s accounts receivable as of March 31, 2016 and June 30, 2015 consist primarily of credit card receivables. Based on the Company’s verification process for customer credit cards and historical information available, management has determined that an allowance for doubtful accounts on credit card sales as of March 31, 2016 is not necessary. No bad debt expense has been recorded for the periods ended March 31, 2016 and March 31, 2015 . Inventory As of March 31, 2016 and June 30, 2015 , inventory consisted of (in thousands): March 31, June 30, Finished goods $ 8,913 $ 5,783 Raw materials 8,089 3,465 Total inventory $ 17,002 $ 9,248 Inventories are carried and depicted above at the lower of cost or net realizable value, using the first-in, first-out method, which includes a reduction in inventory values of $0.3 million and $0.3 million at March 31, 2016 and June 30, 2015 , respectively, related to obsolete and slow-moving inventory. Revenue Recognition The Company ships the majority of its product directly to the consumer and receives substantially all payment for these sales in the form of credit card receipts. Revenue from direct product sales to customers is recognized upon shipment when passage of title and risk of loss occurs. Estimated returns are recorded when product is shipped. Subject to some exceptions based on local regulations, the Company’s return policy is to provide a full refund for product returned within 30 days if the returned product is unopened or defective. After 30 days, the Company generally does not issue refunds to direct sales customers for returned product. The Company allows terminating distributors to return up to 30% of unopened, unexpired product that they have purchased within the prior twelve months for a full refund, less a 10% restocking fee. The Company establishes the returns reserve based on historical experience. The returns reserve is evaluated on a quarterly basis. As of March 31, 2016 and June 30, 2015 , the Company’s reserve balance for returns and allowances was approximately $0.3 million and $0.1 million , respectively. Shipping and Handling Shipping and handling costs associated with inbound freight and freight out to customers, including independent distributors, are included in cost of sales. Shipping and handling fees charged to customers are included in sales. Research and Development Costs The Company expenses all costs related to research and development activities as incurred. Research and development expenses for the nine months ended March 31, 2016 and 2015 were approximately $0.7 million and $1.8 million , respectively. Stock-Based Compensation The Company recognizes stock-based compensation by measuring the cost of services to be rendered based on the grant date fair value of the equity award. The Company recognizes stock-based compensation, net of any estimated forfeitures, over the period an employee is required to provide service in exchange for the award, generally referred to as the requisite service period. For awards with market-based performance conditions, the cost of the awards is recognized as the requisite service is rendered by employees, regardless of when, if ever, the market based performance conditions are satisfied. The Black-Scholes option pricing model is used to estimate the fair value of stock options. The determination of the fair value of stock options is affected by the Company's stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company uses historical volatility as the expected volatility assumption required in the Black-Scholes model. The Company utilizes a simplified method for estimating the expected life of the options. The Company uses this method because it believes that it provides a better estimate than the Company’s historical data as post vesting exercises have been limited. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected terms of the stock options. The fair value of restricted stock grants is based on the closing market price of the Company's stock on the date of grant less the Company's expected dividend yield. The fair value of performance stock units that include market-based performance conditions is based on the closing market price of the Company's stock on the date of grant less the Company's expected dividend yield, with further adjustments made to reflect the market conditions that must be satisfied in order for the units to vest by using a Monte-Carlo simulation model. Key assumptions for the Monte-Carlo simulation model include the risk-free rate, expected volatility, expected dividends and the correlation coefficient. The fair value of cash-settled performance-based awards, accounted for as liabilities, is remeasured at the end of each reporting period and is based on the closing market price of the Company’s stock on the last day of the reporting period. The Company recognizes compensation costs for awards with performance conditions when it concludes it is probable that the performance conditions will be achieved. The Company reassesses the probability of vesting at each balance sheet date and adjusts compensation costs accordingly. Reverse Stock Split In October 2015, following approval of the Company's shareholders, the Company's board of directors approved the filing of an amendment to the Company's amended and restated articles of incorporation to effectuate a reverse split of the issued and outstanding shares of the Company's common stock on a one-for-seven basis. The reverse stock split was effective on October 19, 2015 . The par value and authorized number of shares of common stock were not adjusted as a result of the reverse split. All fractional shares resulting from the reverse stock split were rounded up. All issued and outstanding common stock and per share amounts contained within the Company's consolidated financial statements and footnotes have been retroactively adjusted to reflect this reverse stock split for all periods presented. 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 amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using statutory tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the effective date of the change. For the nine months ended March 31, 2016 and 2015 the Company recognized income tax expense of $2.2 million and $3.2 million , respectively, which is reflective of the Company’s current estimated federal, state and foreign effective tax rate. Realization of deferred tax assets is dependent upon future earnings in specific tax jurisdictions, the timing and amount of which are uncertain. The Company continues to evaluate the realizability of the deferred tax asset based upon achieved and estimated future results. The difference between the nine months ended March 31, 2016 effective rate of 37.8% and the Federal statutory rate of 35.0% is due primarily to the effect of certain permanent differences, discrete items and return to provision adjustments. Income Per Share Basic income per common share is computed by dividing the net income by the weighted-average number of common shares outstanding during the period, less unvested restricted stock awards. Diluted income per common share is computed by dividing net income by the weighted-average common shares and potentially dilutive common share equivalents using the treasury stock method. For the three and nine months ended March 31, 2016 the effects of approximately 0.1 million and 0.2 million common shares, respectively, issuable upon exercise of options and non-vested shares of restricted stock granted pursuant to the Company’s 2007 and 2010 Long-Term Incentive Plans are not included in computations because their effect was anti-dilutive. For the three and nine months ended March 31, 2015 the effects of approximately 0.4 million and 0.3 million common shares, respectively, issuable upon exercise of options granted pursuant to the Company’s 2007 and 2010 Long-Term Incentive Plans were not included in computations because their effect was anti-dilutive. The following is a reconciliation of net income per share and the weighted-average common shares outstanding for purposes of computing basic and diluted net income per share (in thousands except per share amounts): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 Numerator: Net income $ 1,003 $ 573 $ 3,669 $ 6,761 Denominator: Basic weighted-average common shares outstanding 13,734 13,724 13,721 13,969 Effect of dilutive securities: Stock awards and options 321 167 281 214 Warrants 73 70 70 73 Diluted weighted-average common shares outstanding 14,128 13,961 14,072 14,256 Net income per share, basic $ 0.07 $ 0.04 $ 0.27 $ 0.48 Net income per share, diluted $ 0.07 $ 0.04 $ 0.26 $ 0.47 Segment Information The Company operates in a single operating segment by selling products to an international network of independent distributors that operates in an integrated manner from market to market. Commissions and incentives expenses are the Company’s largest expense comprised of the commissions paid to its independent distributors. The Company manages its business primarily by managing its international network of independent distributors. The Company does not use profitability reports on a regional or divisional basis for making business decisions. However, the Company does report revenue in two geographic regions: the Americas region and the Asia/Pacific & Europe region. Revenues by geographic area are as follows (in thousands): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 Americas $ 44,012 $ 32,901 $ 118,793 $ 104,397 Asia/Pacific & Europe 12,148 12,254 34,714 40,638 Total revenues $ 56,160 $ 45,155 $ 153,507 $ 145,035 Additional information as to the Company’s revenue from operations in the most significant geographical areas is set forth below (in thousands): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 United States $ 42,565 $ 31,715 $ 114,822 $ 100,428 Japan $ 9,023 $ 9,678 $ 26,836 $ 32,313 As of March 31, 2016 , long-lived assets were $4.7 million in the United States and $1.3 million in Japan. As of June 30, 2015 , long-lived assets were $6.5 million in the United States and $1.5 million in Japan. Effect of New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued ASC 606, Revenue from Contracts with Customers , which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition . The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration it expects to receive in exchange for those goods or services. ASC 606 will be effective for the Company in the first quarter of fiscal 2019. The Company has performed a detailed analysis and does not anticipate that ASC 606 will have a significant impact on revenue recognition or its consolidated financial statements due to the types of revenue transactions that the Company enters into. In April 2015, FASB issued Accounting Standards Update (ASU) No. 2015-03 , Interest - Imputation of Interest (Subtopic 825-30): Simplifying the Presentation of Debt Issuance Costs. This guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The Company adopted this updated standard in the current year during the interim period ended September 30, 2015 by reclassifying the debt issuance costs from long-term assets to a direct deduction from the related debt, consistent with the debt discount. All prior period balances have been retrospectively adjusted. In November 2015, FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. Current GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this update require that all deferred tax assets or liabilities be classified as noncurrent in the classified statement of financial position. The amendments in this update are effective for the annual periods beginning after December 15, 2016 and interim periods within those annual periods. The Company does not anticipate that the adoption of this guidance will have a material impact on its consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 841) . For lessees, the amendments in this update require that for all leases not considered to be short term, a company recognize both a lease liability and right-of-use asset on its balance sheet, representing the obligation to make payments and the right to use or control the use of a specified asset for the lease term. The amendments in this update are effective for annual periods beginning after December 15, 2018 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. In March 2016, FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net). This update was intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations. The amendments in this update have the same effective date as ASC 606 as discussed above. In March 2016, FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this update change the accounting for certain stock-based compensation transactions, including the income tax consequences and cash flow classification for applicable transactions. The amendments in this update are effective for annual periods beginning after December 31, 2016 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt On October 18, 2013 , the Company entered into a Financing Agreement providing for a term loan facility in an aggregate principal amount of $47 million (the “October 2013 Term Loan”) and a delayed draw term loan facility in an aggregate principal amount not to exceed $20 million (the “October 2013 Delayed Draw Term Loan”). The October 2013 Delayed Draw Term Loan was available for borrowing in specified minimum amounts from time to time beginning after the effective date of the Financing Agreement until October 18, 2014 . The Company did not borrow any amounts under the October 2013 Delayed Draw Term Loan. On May 1, 2015 , the Company entered into an Amendment No. 1 to Financing Agreement ("Amendment No. 1"). Amendment No. 1 revised the March 31, 2015 and June 30, 2015 consolidated EBITDA covenants from $20.6 million and $21.3 million , respectively, to $17.0 million for each quarter end. Amendment No. 1 also revised the minimum unrestricted cash and cash equivalents that the Company was required to hold from $10.0 million to $8.0 million for the reporting periods ended March 31, 2015 and June 30, 2015 . In addition, Amendment No. 1 required that the Company make certain accelerated principal payments on the October 2013 Term Loan totaling $4.5 million during the fourth quarter of fiscal year 2015 . On August 27, 2015 , the Company entered into an Amendment No. 2 to Financing Agreement ("Amendment No. 2" and collectively, with the October 2013 Term Loan, as previously amended by Amendment No. 1, the "October 2013 Credit Facility"). Amendment No. 2 revised the covenants related to minimum consolidated EBITDA (as defined in the amended Financing Agreement) for the four consecutive fiscal quarters ending September 30, 2015 , December 31, 2015 , March 31, 2016 and June 30, 2016 from $22.2 million , $23.1 million , $24.4 million and $25.6 million , respectively, to $14.5 million , $15.0 million , $17.0 million and $17.5 million , respectively. In addition, Amendment No. 2 required that the Company make additional monthly accelerated principal payments on the October 2013 Term Loan in the amount of $0.5 million commencing on October 15, 2015 and continuing until the Term Loan was paid in full. Amendment No. 2 also required that the Company make additional accelerated payments at the end of each fiscal quarter in the amount of all unrestricted cash on hand as of the close of business on the last day of the quarter in excess of $12.5 million . The principal amount of the October 2013 Term Loan was payable in consecutive quarterly installments beginning with the calendar quarter ended March 31, 2014 and matured on the earlier of October 18, 2018 or such date as the outstanding loans became payable in accordance with the terms of the Financing Agreement (the “Final Maturity Date”). The October 2013 Term loan bore interest at a rate equal to 7.5% per annum plus the greater of (i) 1.25% or (ii) LIBOR, or at the Company’s option, a reference rate (as defined in the Financing Agreement) plus 6.5% per annum, with such interest payable monthly. For the nine months ended March 31, 2016 , the average interest rate was 8.75% . On March 30, 2016 , the Company repaid the full amount outstanding under the October 2013 Term Loan and terminated the October 2013 Credit Facility. On March 30, 2016 , the Company entered into a Loan Agreement (the “March 2016 Loan Agreement”) to refinance its outstanding debt under the October 2013 Term Loan. In connection with the March 2016 Loan Agreement and on the same date, the Company entered into a Security Agreement (the “March 2016 Security Agreement”). The March 2016 Loan Agreement provides for a term loan in an aggregate principal amount of $10.0 million (the “March 2016 Term Loan") and a revolving loan facility in an aggregate principal amount not to exceed $2.0 million (the “March 2016 Revolving Loan,” and collectively with the March 2016 Term Loan, the March 2016 Loan Agreement and the March 2016 Security Agreement, the “March 2016 Credit Facility”). The principal amount of the March 2016 Term Loan is payable in consecutive quarterly installments in the amount of $0.5 million plus accrued interest beginning with the fiscal quarter ended June 30, 2016 and maturing on March 30, 2019 (the “Maturity Date”). The March 2016 Term Loan bears interest at a fixed rate of 4.93% . If the Company borrows under the March 2016 Revolving Loan, interest will be payable quarterly in arrears on the last day of each fiscal quarter at a variable rate equal to the 30 day LIBOR Rate plus 3.50% . The Company’s obligations under the March 2016 Credit Facility are secured by a security interest in substantially all of the Company’s assets. Loans outstanding under the March 2016 Credit Facility may be prepaid in whole or in part at any time without premium or penalty. In addition, if, at any time, the aggregate principal amount outstanding under the March 2016 Revolving Loan exceeds $2.0 million , the Company must prepay an amount equal to such excess. Any principal amount of the March 2016 Term Loan which is prepaid or repaid may not be re-borrowed. The March 2016 Credit Facility contains customary covenants, including affirmative and negative covenants that, among other things, restrict the Company’s ability to create certain types of liens, incur additional indebtedness, declare or pay dividends on or redeem capital stock, make other payments to holders of equity interests in the Company, make certain investments, purchase or otherwise acquire all or substantially all the assets or equity interests of other companies, sell assets or enter into consolidations, mergers or transfers of all or any substantial part of the Company’s assets. The March 2016 Credit Facility also contains various financial covenants that require the Company to maintain a certain consolidated minimum tangible net worth, minimum working capital amounts, and certain debt to EBITDA and fixed charge coverage ratios. Additionally, the March 2016 Credit Facility contains cross-default provisions, whereby a default under the terms of certain indebtedness or an uncured default of a payment or other material obligation of the Company under a material contract of the Company will cause a default on the remaining indebtedness under the March 2016 Credit Facility. As of March 31, 2016 , the Company was in compliance with all applicable covenants under the March 2016 Credit Facility. During the nine months ended March 31, 2016 , the Company recorded interest expense of $0.4 million related to the normal amortization of transaction costs associated with the October 2013 Credit Facility. During the three months ended March 31, 2016 , in connection with refinancing the outstanding debt under the October 2013 Credit Facility, the Company charged to interest expense the remaining $1.5 million in unamortized transaction costs associated with that credit facility, which is included in interest expense. At March 31, 2016 , the Company had unamortized transaction costs totaling $0.1 million included in the consolidated balance sheet related to the March 2016 Credit Facility. This balance will be amortized to interest expense using the effective interest method over the term of the loan. The Company’s book value for the March 2016 Credit Facility approximates the fair value. Aggregate future principal payments required in accordance with the terms of the March 2016 Credit Facility are as follows (in thousands): Fiscal Year Ending June 30, Amount 2016 (remaining three months ending June 30, 2016) $ 500 2017 2,000 2018 2,000 2019 5,500 $ 10,000 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity During the three and nine months ended March 31, 2016 , the Company issued 18,000 and 76,000 shares, respectively, of restricted stock and 5,000 and 22,000 shares, respectively, of common stock upon the exercise of warrants and options. During the three and nine months ended March 31, 2016 , 6,000 and 47,000 shares, respectively, of restricted stock were canceled or surrendered as payment of tax withholding upon vesting. The Company’s Articles of Incorporation authorize the issuance of preferred shares. However, as of March 31, 2016 , none have been issued and no rights or preferences have been assigned to the preferred shares by the Company’s Board of Directors. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | Stock-based Compensation Long-Term Incentive Plans The Company adopted and the shareholders approved the 2007 Long-Term Incentive Plan (the “2007 Plan”), effective November 21, 2006, to provide incentives to certain eligible employees, directors and consultants. A maximum of 1.4 million shares of the Company's common stock can be issued under the 2007 Plan in connection with the grant of awards. Awards to purchase common stock have been granted pursuant to the 2007 Plan and are outstanding to various employees, officers, directors, Scientific Advisory Board members and independent distributors at prices between $1.47 and $10.50 per share, with initial vesting periods of one to three years. Awards expire in accordance with the terms of each award and the shares subject to the award are added back to the 2007 Plan upon expiration of the award. The contractual term of stock options granted is generally ten years. As of March 31, 2016 , there were awards outstanding, net of awards expired, for the purchase in aggregate of 0.3 million shares of the Company's common stock. The Company adopted and the shareholders approved the 2010 Long-Term Incentive Plan (the “2010 Plan”), effective September 27, 2010, as amended on August 21, 2014, to provide incentives to eligible employees, directors and consultants. A maximum of 1.5 million shares of the Company's common stock can be issued under the 2010 Plan in connection with the grant of awards. Awards to purchase common stock have been granted pursuant to the 2010 Plan and are outstanding to various employees, officers and directors. Outstanding stock options awarded under the 2010 Plan have exercise prices between $4.41 and $24.71 per share, and vest over one to four year vesting periods. Awards expire in accordance with the terms of each award and the shares subject to the award are added back to the 2010 Plan upon expiration of the award. The contractual term of stock options granted is generally ten years. As of March 31, 2016 , there were awards outstanding, net of awards expired, for an aggregate of 0.1 million shares of the Company’s common stock. The Company adopted a Performance Incentive Plan effective July 1, 2013 (the "Fiscal 2014 Performance Plan"). The Fiscal 2014 Performance Plan is intended to provide selected employees an opportunity to earn performance-based cash bonuses whose value is based upon the Company’s stock value and to encourage such employees to provide services to the Company and to attract new individuals with outstanding qualifications. The Fiscal 2014 Performance Plan seeks to achieve this purpose by providing for awards in the form of performance share units (the “Units”). No shares will be issued under the Fiscal 2014 Performance Plan. Awards may be settled only with cash and will be paid subsequent to award vesting. The fair value of share-based compensation awards, that include performance shares, are accounted for as liabilities. Vesting for the Units is subject to achievement of both service-based and performance-based vesting requirements. Performance-based vesting occurs in three installments if the Company meets certain performance criteria generally set for each year of a three -year performance period. The service-based vesting criteria occurs in three annual installments which are achieved at the end of a given fiscal year only if the participant has continuously remained in service from the date of award through the end of that fiscal year. The fair value of these awards is based on the trading price of the Company's common stock and is remeasured at each reporting period date until settlement. The Company adopted separate Performance Incentive Plans effective July 1, 2014 (the "Fiscal 2015 Performance Plan") and July 1, 2015 (the "Fiscal 2016 Performance Plan"). The Fiscal 2015 and 2016 Performance Plans are substantially similar to the Fiscal 2014 Performance Plan except that the service-based vesting criteria occurs in a single installment and is achieved at the end of the third fiscal year after the awards are granted if the participant has continuously remained in service from the date of the award through the end of the third fiscal year. Stock-Based Compensation In accordance with accounting guidance for stock-based compensation, payments in equity instruments for goods or services are accounted for under the fair value method. For the three and nine months ended March 31, 2016 , stock-based compensation of $0.7 million and $1.2 million , respectively, was reflected as an increase to additional paid-in capital and an increase of $58,000 and $135,000 , respectively, was included in other accrued expenses, all of which was employee related. For the three and nine months ended March 31, 2015 , stock-based compensation of $0.6 million and $1.4 million , was reflected as an increase to additional paid-in capital, all of which was employee related. On January 4, 2016 , the Company awarded Performance Stock Units under the 2010 Long-Term Incentive Plan to its executive officers (the "Recipients") and, in March 2016 , the Company and each Recipient entered into an amended and restated stock unit agreement (the "Restated Stock Unit Agreement") amending the terms of the January 2016 awards. Under the Restated Stock Unit Agreements, vesting for the Performance Stock Units occurs at the end of a three year performance period (the "Performance Period") and is subject to achievement of both service-based and market-based performance vesting requirements. Subject generally to the Recipient's continued service with the Company (the service based requirement), each Performance Stock Unit represents a contingent right for the Recipient to receive, within thirty days after the end of the performance period, a distribution of shares of common stock of the Company equal to 0% to 200% of the target number of Performance Stock Units subject to the award. The actual number of shares distributed will be based on the Company's total stockholder return ("TSR") performance during the Performance Period, subject to acceleration upon a change in control of the Company. The vesting for 50% of the Performance Stock Units is based upon the Company's absolute TSR for the performance period compared to a matrix of fixed numeric values and the vesting for the other 50% of the Performance Stock Units is based upon the relative comparison of the Company's TSR to the Vanguard Russell 2000 exchange traded fund TSR. The fair value of the Performance Stock Units will be recognized on a straight-line basis over the requisite service period of the awards, regardless of when, if ever, the market-based performance conditions are satisfied. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies From time to time, the Company is involved in lawsuits and disputes arising in the normal course of business. The Company regularly reviews all pending litigation matters in which it is involved and establishes accruals deemed appropriate by management for these litigation matters when a probable loss estimate can be made. In the opinion of management, the amounts accrued for as of March 31, 2016 are appropriate based on the probable outcome of currently pending matters. |
Summary of Significant Accoun13
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Consolidation | Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation. |
Use of Estimates | Use of Estimates We prepare our consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (GAAP). In preparing these statements, we are required to use estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates and assumptions. On an ongoing basis, we review our estimates, including those related to inventory valuation and obsolescence, sales returns, income taxes and tax valuation reserves, share-based compensation, and loss contingencies. |
Translation of Foreign Currency Statements | Translation of Foreign Currency Statements A portion of the Company’s business operations occurs outside the United States. The local currency of each of the Company’s subsidiaries is generally its functional currency. All assets and liabilities are translated into U.S. dollars at exchange rates existing at the balance sheet dates, revenue and expenses are translated at weighted-average exchange rates and stockholders’ equity is recorded at historical exchange rates. The resulting foreign currency translation adjustments are recorded as a separate component of stockholders’ equity in the condensed consolidated balance sheets and as a component of comprehensive income. Transaction gains and losses and currency translation gains and losses on intercompany balances denominated in a foreign currency are included in other income (expense), net in the condensed consolidated statements of operations and comprehensive income. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company's subsidiaries enter into transactions with each other which may not be denominated in the respective subsidiaries' functional currencies. The Company seeks to reduce its exposure to fluctuations in foreign exchange rates through the use of derivatives. The Company does not use such derivative financial instruments for trading or speculative purposes. To hedge risks associated with the foreign-currency-denominated intercompany transactions, the Company entered into forward foreign exchange contracts which were settled in March 2016 and were not designated for hedge accounting. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers only its monetary liquid assets with original maturities of three months or less as cash and cash equivalents. |
Concentration of Credit Risk | Concentration of Credit Risk Accounting guidance for financial instruments requires disclosure of significant concentrations of credit risk regardless of the degree of such risk. Financial instruments with significant credit risk include cash and investments. |
Accounts Receivable | Accounts Receivable The Company’s accounts receivable as of March 31, 2016 and June 30, 2015 consist primarily of credit card receivables. Based on the Company’s verification process for customer credit cards and historical information available, management has determined that an allowance for doubtful accounts on credit card sales as of March 31, 2016 is not necessary. |
Inventory | Inventories are carried and depicted above at the lower of cost or net realizable value, using the first-in, first-out method |
Revenue Recognition | Revenue Recognition The Company ships the majority of its product directly to the consumer and receives substantially all payment for these sales in the form of credit card receipts. Revenue from direct product sales to customers is recognized upon shipment when passage of title and risk of loss occurs. Estimated returns are recorded when product is shipped. Subject to some exceptions based on local regulations, the Company’s return policy is to provide a full refund for product returned within 30 days if the returned product is unopened or defective. After 30 days, the Company generally does not issue refunds to direct sales customers for returned product. The Company allows terminating distributors to return up to 30% of unopened, unexpired product that they have purchased within the prior twelve months for a full refund, less a 10% restocking fee. The Company establishes the returns reserve based on historical experience. The returns reserve is evaluated on a quarterly basis. |
Shipping and Handling | Shipping and Handling Shipping and handling costs associated with inbound freight and freight out to customers, including independent distributors, are included in cost of sales. Shipping and handling fees charged to customers are included in sales. |
Research and Development Costs | Research and Development Costs The Company expenses all costs related to research and development activities as incurred. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes stock-based compensation by measuring the cost of services to be rendered based on the grant date fair value of the equity award. The Company recognizes stock-based compensation, net of any estimated forfeitures, over the period an employee is required to provide service in exchange for the award, generally referred to as the requisite service period. For awards with market-based performance conditions, the cost of the awards is recognized as the requisite service is rendered by employees, regardless of when, if ever, the market based performance conditions are satisfied. The Black-Scholes option pricing model is used to estimate the fair value of stock options. The determination of the fair value of stock options is affected by the Company's stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The Company uses historical volatility as the expected volatility assumption required in the Black-Scholes model. The Company utilizes a simplified method for estimating the expected life of the options. The Company uses this method because it believes that it provides a better estimate than the Company’s historical data as post vesting exercises have been limited. The risk-free interest rate assumption is based on observed interest rates appropriate for the expected terms of the stock options. The fair value of restricted stock grants is based on the closing market price of the Company's stock on the date of grant less the Company's expected dividend yield. The fair value of performance stock units that include market-based performance conditions is based on the closing market price of the Company's stock on the date of grant less the Company's expected dividend yield, with further adjustments made to reflect the market conditions that must be satisfied in order for the units to vest by using a Monte-Carlo simulation model. Key assumptions for the Monte-Carlo simulation model include the risk-free rate, expected volatility, expected dividends and the correlation coefficient. The fair value of cash-settled performance-based awards, accounted for as liabilities, is remeasured at the end of each reporting period and is based on the closing market price of the Company’s stock on the last day of the reporting period. The Company recognizes compensation costs for awards with performance conditions when it concludes it is probable that the performance conditions will be achieved. The Company reassesses the probability of vesting at each balance sheet date and adjusts compensation costs accordingly. |
Income Taxes | 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 amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. Deferred tax assets and liabilities are measured using statutory tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the effective date of the change. |
Income Per Share | Income Per Share Basic income per common share is computed by dividing the net income by the weighted-average number of common shares outstanding during the period, less unvested restricted stock awards. Diluted income per common share is computed by dividing net income by the weighted-average common shares and potentially dilutive common share equivalents using the treasury stock method. |
Segment Information | Segment Information The Company operates in a single operating segment by selling products to an international network of independent distributors that operates in an integrated manner from market to market. Commissions and incentives expenses are the Company’s largest expense comprised of the commissions paid to its independent distributors. The Company manages its business primarily by managing its international network of independent distributors. The Company does not use profitability reports on a regional or divisional basis for making business decisions. However, the Company does report revenue in two geographic regions: the Americas region and the Asia/Pacific & Europe region. |
Effect of New Accounting Pronouncements | Effect of New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued ASC 606, Revenue from Contracts with Customers , which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition . The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration it expects to receive in exchange for those goods or services. ASC 606 will be effective for the Company in the first quarter of fiscal 2019. The Company has performed a detailed analysis and does not anticipate that ASC 606 will have a significant impact on revenue recognition or its consolidated financial statements due to the types of revenue transactions that the Company enters into. In April 2015, FASB issued Accounting Standards Update (ASU) No. 2015-03 , Interest - Imputation of Interest (Subtopic 825-30): Simplifying the Presentation of Debt Issuance Costs. This guidance requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The Company adopted this updated standard in the current year during the interim period ended September 30, 2015 by reclassifying the debt issuance costs from long-term assets to a direct deduction from the related debt, consistent with the debt discount. All prior period balances have been retrospectively adjusted. In November 2015, FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. Current GAAP requires an entity to separate deferred income tax liabilities and assets into current and noncurrent amounts in a classified statement of financial position. To simplify the presentation of deferred income taxes, the amendments in this update require that all deferred tax assets or liabilities be classified as noncurrent in the classified statement of financial position. The amendments in this update are effective for the annual periods beginning after December 15, 2016 and interim periods within those annual periods. The Company does not anticipate that the adoption of this guidance will have a material impact on its consolidated financial statements. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 841) . For lessees, the amendments in this update require that for all leases not considered to be short term, a company recognize both a lease liability and right-of-use asset on its balance sheet, representing the obligation to make payments and the right to use or control the use of a specified asset for the lease term. The amendments in this update are effective for annual periods beginning after December 15, 2018 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. In March 2016, FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net). This update was intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations. The amendments in this update have the same effective date as ASC 606 as discussed above. In March 2016, FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this update change the accounting for certain stock-based compensation transactions, including the income tax consequences and cash flow classification for applicable transactions. The amendments in this update are effective for annual periods beginning after December 31, 2016 and interim periods within those annual periods. The Company is currently evaluating the impact that this amendment will have on its consolidated financial statements. |
Summary of Significant Accoun14
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Components of Inventory | As of March 31, 2016 and June 30, 2015 , inventory consisted of (in thousands): March 31, June 30, Finished goods $ 8,913 $ 5,783 Raw materials 8,089 3,465 Total inventory $ 17,002 $ 9,248 |
Summary of Computation of Net Income Per Share | The following is a reconciliation of net income per share and the weighted-average common shares outstanding for purposes of computing basic and diluted net income per share (in thousands except per share amounts): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 Numerator: Net income $ 1,003 $ 573 $ 3,669 $ 6,761 Denominator: Basic weighted-average common shares outstanding 13,734 13,724 13,721 13,969 Effect of dilutive securities: Stock awards and options 321 167 281 214 Warrants 73 70 70 73 Diluted weighted-average common shares outstanding 14,128 13,961 14,072 14,256 Net income per share, basic $ 0.07 $ 0.04 $ 0.27 $ 0.48 Net income per share, diluted $ 0.07 $ 0.04 $ 0.26 $ 0.47 |
Revenues by Geographic Area | Revenues by geographic area are as follows (in thousands): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 Americas $ 44,012 $ 32,901 $ 118,793 $ 104,397 Asia/Pacific & Europe 12,148 12,254 34,714 40,638 Total revenues $ 56,160 $ 45,155 $ 153,507 $ 145,035 |
Additional Information as to Company's Revenue from Operations in most Significant Geographical Areas | Additional information as to the Company’s revenue from operations in the most significant geographical areas is set forth below (in thousands): For the Three Months Ended March 31, For the Nine Months Ended March 31, 2016 2015 2016 2015 United States $ 42,565 $ 31,715 $ 114,822 $ 100,428 Japan $ 9,023 $ 9,678 $ 26,836 $ 32,313 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Future Principal Payments of the Credit Facility | Aggregate future principal payments required in accordance with the terms of the March 2016 Credit Facility are as follows (in thousands): Fiscal Year Ending June 30, Amount 2016 (remaining three months ending June 30, 2016) $ 500 2017 2,000 2018 2,000 2019 5,500 $ 10,000 |
Summary of Significant Accoun16
Summary of Significant Accounting Policies - Narrative (Details) shares in Millions | Oct. 19, 2015 | Mar. 31, 2016USD ($)shares | Mar. 31, 2015USD ($)shares | Mar. 31, 2016USD ($)Segmentshares | Mar. 31, 2015USD ($)shares | Jun. 30, 2015USD ($) |
Summary Of Significant Accounting Policies | ||||||
Foreign currency transaction gain (loss), realized | $ 200,000 | $ (100,000) | $ (22,000) | $ (400,000) | ||
Derivative instruments, gain (loss) realized in income, net | (200,000) | (100,000) | (200,000) | 300,000 | ||
Bad debt expenses | 0 | 0 | ||||
Inventory valuation reserves | $ 300,000 | $ 300,000 | $ 300,000 | |||
Money back guarantee period | 30 days | |||||
Percentage of products can be returned for a full refund by terminated distributors (up to) | 30.00% | 30.00% | ||||
Percent of restocking fee | 10.00% | 10.00% | ||||
Reserve for sales returns | $ 300,000 | $ 300,000 | 100,000 | |||
Research and development | 700,000 | 1,800,000 | ||||
Stock split conversion ratio | 0.1429 | |||||
Income tax expenses | $ 774,000 | $ 151,000 | $ 2,233,000 | $ 3,182,000 | ||
Effective tax rate | 37.80% | |||||
Statutory tax rate | 35.00% | |||||
Antidilutive securities excluded from EPS calculation (in shares) | shares | 0.1 | 0.4 | 0.2 | 0.3 | ||
Number of operating segments | Segment | 1 | |||||
Number of geographic segments | Segment | 2 | |||||
United States | ||||||
Summary Of Significant Accounting Policies | ||||||
Long-lived assets | $ 4,700,000 | $ 4,700,000 | 6,500,000 | |||
Japan | ||||||
Summary Of Significant Accounting Policies | ||||||
Long-lived assets | $ 1,300,000 | 1,300,000 | $ 1,500,000 | |||
Cash Accounts Held Primarily At One Financial Institution | ||||||
Summary Of Significant Accounting Policies | ||||||
Concentration of credit risk | 4,200,000 | |||||
Cash Accounts Held At Other Financial Institutions | ||||||
Summary Of Significant Accounting Policies | ||||||
Concentration of credit risk | $ 4,300,000 |
Summary of Significant Accoun17
Summary of Significant Accounting Policies - Components of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Jun. 30, 2015 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 8,913 | $ 5,783 |
Raw materials | 8,089 | 3,465 |
Total inventory | $ 17,002 | $ 9,248 |
Summary of Significant Accoun18
Summary of Significant Accounting Policies - Summary of Computation of Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Numerator: | ||||
Net income | $ 1,003 | $ 573 | $ 3,669 | $ 6,761 |
Denominator: | ||||
Basic weighted-average common shares outstanding (in shares) | 13,734 | 13,724 | 13,721 | 13,969 |
Effect of dilutive securities: | ||||
Stock awards and options (in shares) | 321 | 167 | 281 | 214 |
Warrants (in shares) | 73 | 70 | 70 | 73 |
Diluted weighted-average common shares outstanding (in shares) | 14,128 | 13,961 | 14,072 | 14,256 |
Net income per share, basic (USD per share) | $ 0.07 | $ 0.04 | $ 0.27 | $ 0.48 |
Net income per share, diluted (USD per share) | $ 0.07 | $ 0.04 | $ 0.26 | $ 0.47 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies - Revenue by Geographic Regions and Significant Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Segment Reporting Information | ||||
Total revenues | $ 56,160 | $ 45,155 | $ 153,507 | $ 145,035 |
Americas | ||||
Segment Reporting Information | ||||
Total revenues | 44,012 | 32,901 | 118,793 | 104,397 |
Asia/Pacific & Europe | ||||
Segment Reporting Information | ||||
Total revenues | 12,148 | 12,254 | 34,714 | 40,638 |
United States | ||||
Segment Reporting Information | ||||
Total revenues | 42,565 | 31,715 | 114,822 | 100,428 |
Japan | ||||
Segment Reporting Information | ||||
Total revenues | $ 9,023 | $ 9,678 | $ 26,836 | $ 32,313 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | Mar. 30, 2016 | Oct. 15, 2015 | Mar. 31, 2016 | Jun. 30, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Aug. 27, 2015 | May. 01, 2015 | Oct. 18, 2013 |
Line of Credit Facility [Line Items] | ||||||||||||
Interest expenses related to credit facility | $ 400,000 | |||||||||||
Write-off of capitalized debt transaction costs pursuant to debt refinance | $ 1,500,000 | 1,544,000 | $ 0 | |||||||||
Unamortized deferred debt offering costs and debt discount | 100,000 | $ 100,000 | ||||||||||
Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate during period | 8.75% | |||||||||||
October 2013 Term Loan | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Maximum capacity on draw | $ 47,000,000 | |||||||||||
October 2013 Delayed Draw Term Loan | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Maximum capacity on draw | $ 20,000,000 | |||||||||||
Financing Agreement, October 2013 | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Restricted cash and cash equivalents | 10,000,000 | |||||||||||
Financing Agreement, October 2013 | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | $ 21,307,000 | $ 20,592,000 | ||||||||||
Financing Agreement Amendment, May 2015 | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | 24,400,000 | $ 24,400,000 | $ 23,100,000 | $ 22,220,000 | ||||||||
Restricted cash and cash equivalents | $ 8,000,000 | |||||||||||
Accelerated principal payment per amendment to financing agreement | $ 4,500,000 | |||||||||||
Financing Agreement Amendment, May 2015 | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | $ 17,000,000 | |||||||||||
Financing Agreement Amendment, August 2015 | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | 17,000,000 | 17,000,000 | $ 15,000,000 | $ 14,500,000 | ||||||||
Accelerated principal payment per amendment to financing agreement | $ 500,000 | |||||||||||
Line of credit facility, covenant compliance, unrestricted cash and cash equivalent | $ 12,500,000 | |||||||||||
March 2016 Term Loan | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Maximum capacity on draw | $ 10,000,000 | $ 10,000,000 | ||||||||||
Frequency of periodic payment | quarterly | |||||||||||
Quarterly installments | $ 500,000 | |||||||||||
Fixed rate interest on debt | 4.93% | 4.93% | ||||||||||
March 2016 Revolving Loan | Revolving Credit Facility | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Maximum capacity on draw | $ 2,000,000 | $ 2,000,000 | ||||||||||
Greater of 1.25% or LIBOR | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate per annum over the variable basis | 7.50% | 7.50% | ||||||||||
Minimum rate or LIBOR added to stated interest rate | 1.25% | 1.25% | ||||||||||
Reference Rate at the Company's Option | Secured Debt | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate per annum over the variable basis | 6.50% | 6.50% | ||||||||||
30 Day LIBOR | March 2016 Revolving Loan | Revolving Credit Facility | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Interest rate per annum over the variable basis | 3.50% | 3.50% | ||||||||||
Scenario, Forecast | Financing Agreement Amendment, May 2015 | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | $ 25,607,000 | |||||||||||
Scenario, Forecast | Financing Agreement Amendment, August 2015 | ||||||||||||
Line of Credit Facility [Line Items] | ||||||||||||
Consolidated EBITDA per amendment to financing agreement | $ 17,500,000 |
Long-Term Debt - Future Princip
Long-Term Debt - Future Principal Payments (Details) $ in Thousands | Mar. 31, 2016USD ($) |
Debt Disclosure [Abstract] | |
2016 (remaining three months ending June 30, 2016) | $ 500 |
2,017 | 2,000 |
2,018 | 2,000 |
2,019 | 5,500 |
Long-term debt, gross | $ 10,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Common Stock - shares shares in Thousands | 3 Months Ended | 9 Months Ended |
Mar. 31, 2016 | Mar. 31, 2016 | |
Class of Stock [Line Items] | ||
Issuance of shares related to restricted stock (in shares) | 18 | 76 |
Exercise of options and warrants (in shares) | 5 | 22 |
Shares canceled or surrendered as payment of tax withholding (in shares) | 6 | 47 |
Stock-based Compensation (Detai
Stock-based Compensation (Details) $ / shares in Units, $ in Thousands | Jan. 04, 2016Vesting_Installlment | Mar. 31, 2016USD ($)Vesting_Installlmentshares | Mar. 31, 2015USD ($) | Mar. 31, 2016USD ($)Vesting_Installlment$ / sharesshares | Mar. 31, 2015USD ($) | Jun. 30, 2015shares | Nov. 21, 2006shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock shares outstanding (in shares) | 14,008,000 | 14,008,000 | 13,958,000 | ||||
Stock based compensation reflect in additional paid in capital | $ | $ 700 | $ 600 | $ 1,200 | $ 1,400 | |||
Stock-based compensation awards classified as a liability settled in cash | $ | $ 58 | $ 135 | |||||
2007 Long-Term Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized (in shares) | 1,429,000 | ||||||
Right to purchase common stock, minimum price per share | $ / shares | $ 1.47 | ||||||
Right to purchase common stock, maximum price per share | $ / shares | $ 10.5 | ||||||
Contractual term of stock options granted | 10 years | ||||||
Common stock shares outstanding (in shares) | 300,000 | 300,000 | |||||
2007 Long-Term Incentive Plan | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 1 year | ||||||
2007 Long-Term Incentive Plan | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 3 years | ||||||
2010 Long-Term Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized (in shares) | 1,500,000 | 1,500,000 | |||||
Right to purchase common stock, minimum price per share | $ / shares | $ 4.41 | ||||||
Right to purchase common stock, maximum price per share | $ / shares | $ 24.71 | ||||||
Contractual term of stock options granted | 10 years | ||||||
Aggregate number of shares outstanding (in shares) | 100,000 | 100,000 | |||||
2010 Long-Term Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 3 years | ||||||
Number of vesting installments | Vesting_Installlment | 1,000 | ||||||
2010 Long-Term Incentive Plan | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 1 year | ||||||
2010 Long-Term Incentive Plan | Minimum | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Distribution of shares of common stock percentage | 0.00% | ||||||
2010 Long-Term Incentive Plan | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 4 years | ||||||
2010 Long-Term Incentive Plan | Maximum | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Distribution of shares of common stock percentage | 200.00% | ||||||
2014 Performance Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 3 years | ||||||
Number of vesting installments | Vesting_Installlment | 3 | 3 | |||||
2015 Performance Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 3 years | ||||||
Number of vesting installments | Vesting_Installlment | 1 | 1 | |||||
2016 Performance Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based payment award, vesting period | 3 years | ||||||
Number of vesting installments | Vesting_Installlment | 1 | 1 | |||||
Company's Total Stockholder Return | 2010 Long-Term Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights percentage | 50.00% | ||||||
Companys' TSR Relative to Vanguard Russell 2000 Exchange TSR | 2010 Long-Term Incentive Plan | Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights percentage | 50.00% |