Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 30, 2014 | |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'LCUT | ' |
Entity Registrant Name | 'LIFETIME BRANDS, INC | ' |
Entity Central Index Key | '0000874396 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 13,482,823 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ' | ' |
Cash and cash equivalents | $4,223 | $4,947 |
Accounts receivable, less allowances of $6,402 at March 31, 2014 and $5,209 at December 31, 2013 | 83,568 | 87,217 |
Inventory (Note A) | 136,384 | 112,791 |
Prepaid expenses and other current assets | 11,254 | 5,781 |
Deferred income taxes (Note H) | 3,969 | 3,940 |
TOTAL CURRENT ASSETS | 239,398 | 214,676 |
PROPERTY AND EQUIPMENT, net | 27,707 | 27,698 |
INVESTMENTS (Note C) | 36,750 | 36,948 |
INTANGIBLE ASSETS, net (Note D) | 112,168 | 55,149 |
OTHER ASSETS | 3,228 | 2,268 |
TOTAL ASSETS | 419,251 | 336,739 |
CURRENT LIABILITIES | ' | ' |
Current maturity of Credit Agreement Term Loan (Note E) | 7,500 | ' |
Current maturity of Senior Secured Term Loan (Note E) | ' | 3,937 |
Accounts payable | 28,284 | 21,426 |
Accrued expenses | 35,539 | 41,095 |
Income taxes payable (Note H) | 1,701 | 3,036 |
TOTAL CURRENT LIABILITIES | 73,024 | 69,494 |
DEFERRED RENT & OTHER LONG-TERM LIABILITIES | 20,225 | 18,644 |
DEFERRED INCOME TAXES (Note H) | 10,608 | 1,777 |
REVOLVING CREDIT FACILITY (Note E) | 84,430 | 49,231 |
CREDIT AGREEMENT TERM LOAN (Note E) | 42,500 | ' |
SENIOR SECURED TERM LOAN (Note E) | ' | 16,688 |
STOCKHOLDERS' EQUITY | ' | ' |
Preferred stock, $.01 par value, shares authorized: 100 shares of Series A and 2,000,000 shares of Series B; none issued and outstanding | ' | ' |
Common stock, $.01 par value, shares authorized: 25,000,000; shares issued and outstanding: 13,465,823 at March 31, 2014 and 12,777,407 at December 31, 2013 | 136 | 128 |
Paid-in capital | 156,575 | 146,273 |
Retained earnings | 34,767 | 38,224 |
Accumulated other comprehensive loss (Note K) | -3,014 | -3,720 |
TOTAL STOCKHOLDERS' EQUITY | 188,464 | 180,905 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $419,251 | $336,739 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, allowances | $6,402 | $5,209 |
Preferred stock, par value | $0.01 | $0.01 |
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 13,465,823 | 12,777,407 |
Common stock, shares outstanding | 13,465,823 | 12,777,407 |
Preferred stock Series A | ' | ' |
Preferred stock, shares authorized | 100 | 100 |
Preferred stock, issued | ' | ' |
Preferred stock, outstanding | ' | ' |
Preferred stock Series B | ' | ' |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, issued | ' | ' |
Preferred stock, outstanding | ' | ' |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Net sales | $118,411 | $98,657 |
Cost of sales | 74,079 | 62,345 |
Gross margin | 44,332 | 36,312 |
Distribution expenses | 12,346 | 10,796 |
Selling, general and administrative expenses | 34,183 | 25,631 |
Loss from operations | -2,197 | -115 |
Interest expense (Note E) | -1,390 | -1,162 |
Loss on early retirement of debt (Note E) | -319 | ' |
Loss before income taxes and equity in earnings | -3,906 | -1,277 |
Income tax benefit (Note H) | 1,185 | 399 |
Equity in (losses) earnings, net of taxes (Note C) | -208 | 246 |
NET LOSS | ($2,929) | ($632) |
BASIC LOSS PER COMMON SHARE (NOTE G) | ($0.22) | ($0.05) |
DILUTED LOSS PER COMMON SHARE (NOTE G) | ($0.22) | ($0.05) |
Cash dividends declared per common share (Note K) | $0.04 | $0.03 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive (Loss) Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Net loss | ($2,929) | ($632) |
Other comprehensive income, net of tax: | ' | ' |
Translation adjustment | 690 | 1,125 |
Derivative fair value adjustment | 9 | 13 |
Effect of retirement benefit obligations | 7 | 13 |
Other comprehensive income, net of tax | 706 | 1,151 |
Comprehensive (loss) income | ($2,223) | $519 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
OPERATING ACTIVITIES | ' | ' |
Net loss | ($2,929) | ($632) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ' | ' |
Provision for doubtful accounts | 50 | 32 |
Depreciation and amortization | 3,613 | 2,523 |
Amortization of financing costs | 149 | 123 |
Deferred rent | -274 | -199 |
Deferred income tax | -179 | ' |
Stock compensation expense | 726 | 671 |
Undistributed equity earnings | 208 | -246 |
Loss on retirement of debt | 319 | ' |
Changes in operating assets and liabilities (excluding the effects of business acquisitions) | ' | ' |
Accounts receivable | 19,218 | 35,185 |
Inventory | -3,068 | 541 |
Prepaid expenses, other current assets and other assets | -3,755 | -94 |
Accounts payable, accrued expenses and other liabilities | -10,197 | -8,009 |
Income taxes payable | -2,947 | -4,933 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 934 | 24,962 |
INVESTING ACTIVITIES | ' | ' |
Purchases of property and equipment | -1,156 | -1,187 |
NET CASH USED IN INVESTING ACTIVITIES | -66,292 | -1,187 |
FINANCING ACTIVITIES | ' | ' |
Proceeds from Revolving Credit Facility | 78,657 | 40,121 |
Repayments of Revolving Credit Facility | -43,458 | -62,750 |
Repayment of Senior Secured Term Loan | -20,625 | ' |
Proceeds from Credit Agreement Term Loan | 50,000 | ' |
Payment of financing costs | -1,375 | ' |
Proceeds from the exercise of stock options | 1,200 | 302 |
Cash dividend paid | -501 | -319 |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 63,898 | -22,646 |
Effect of foreign exchange on cash | 736 | -572 |
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | -724 | 557 |
Cash and cash equivalents at beginning of year | 4,947 | 1,871 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 4,223 | 2,428 |
Thomas Plant | ' | ' |
INVESTING ACTIVITIES | ' | ' |
Business acquisition, net of cash acquired | -59,856 | ' |
Other Acquisitions | ' | ' |
INVESTING ACTIVITIES | ' | ' |
Business acquisition, net of cash acquired | ($5,280) | ' |
BASIS_OF_PRESENTATION_AND_SUMM
BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES | ' | ||||||||
NOTE A — BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES | |||||||||
Organization and business | |||||||||
Lifetime Brands, Inc. (the “Company”) designs, sources and sells branded kitchenware, tableware and other products used in the home and markets its products under a number of brand names and trademarks, which are either owned or licensed by the Company or through retailers’ private labels. The Company markets and sells its products principally on a wholesale basis to retailers. The Company also markets and sells a limited selection of its products directly to consumers through its Pfaltzgraff®, Mikasa®, Lifetime Sterling® and The English Table Internet websites. | |||||||||
Basis of presentation | |||||||||
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring accruals, considered necessary for a fair presentation have been included. These condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. Operating results for the three month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. | |||||||||
The Company’s business and working capital needs are highly seasonal, with a majority of sales occurring in the third and fourth quarters. In 2013 and 2012, net sales for the third and fourth quarters accounted for 61% and 58% of total annual net sales, respectively. In anticipation of the pre-holiday shipping season, inventory levels increase primarily in the June through October time period. | |||||||||
Revenue recognition | |||||||||
The Company sells products wholesale, to retailers and distributors, and retail, directly to the consumer. Wholesale sales and retail sales are recognized when title passes to the customer, which is primarily at the shipping point for wholesale sales and upon delivery to the customer for retail sales. Shipping and handling fees that are billed to customers in sales transactions are included in net sales and amounted to $370,000 and $441,000 for the three months ended March 31, 2014 and 2013, respectively. Net sales exclude taxes that are collected from customers and remitted to the taxing authorities. | |||||||||
The Company offers various sales incentives and promotional programs to its customers from time to time in the normal course of business. These incentives and promotions typically include arrangements such as cooperative advertising, buydowns, volume rebates and discounts. These arrangements and an estimate of sales returns are reflected as reductions in net sales in the Company’s condensed consolidated statements of operations. | |||||||||
Distribution expenses | |||||||||
Distribution expenses consist primarily of warehousing expenses and freight-out expenses. | |||||||||
Inventory | |||||||||
Inventory consists principally of finished goods sourced from third-party suppliers. Inventory also includes finished goods, work in process and raw materials related to the Company’s manufacture of sterling silver products. Inventory is priced by the lower of cost (first-in, first-out basis) or market method. The Company estimates the selling price of its inventory on a product by product basis based on the current selling environment. If the estimated selling price is lower than the inventory’s cost, the Company reduces the value of the inventory to its net realizable value. | |||||||||
The components of inventory are as follows: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Finished goods | $ | 132,836 | $ | 108,340 | |||||
Work in process | 1,896 | 1,966 | |||||||
Raw materials | 1,652 | 2,485 | |||||||
Total | $ | 136,384 | $ | 112,791 | |||||
Fair value of financial instruments | |||||||||
The Company determined the carrying amounts of cash and cash equivalents, accounts receivable and accounts payable are reasonable estimates of their fair values because of their short-term nature. The Company determined that the carrying amounts of borrowings outstanding under its revolving credit facility, credit agreement term loan and senior secured term loan approximate fair value since such borrowings bear interest at variable market rates. | |||||||||
Derivatives | |||||||||
The Company accounts for derivative instruments in accordance with ASC Topic No. 815, Derivatives and Hedging. ASC Topic No. 815 requires that all derivative instruments be recognized on the balance sheet at fair value as either an asset or liability. Changes in the fair value of derivatives that qualify as hedges and have been designated as part of a hedging relationship for accounting purposes have no net impact on earnings to the extent the derivative is considered highly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedge item is recognized in earnings. If the derivative which is designated as part of a hedging relationship is considered ineffective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, the changes in fair value are recorded in operations. For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in operations. | |||||||||
The Company is a party to interest rate swap agreements with an aggregate notional amount of $28.9 million to manage interest rate exposure in connection with its variable interest rate borrowings. The hedge period in the agreements commenced in March 2013 and expires in June 2018 and the notional amount amortizes over this period. The interest rate swap agreements were designated as a cash flow hedge under ASC Topic No. 815. The effective portion of the fair value gain or loss on these agreements are recorded as a component of accumulated other comprehensive loss. The effect of recording these derivatives at fair value resulted in an unrealized gain of $9,000 and $13,000, net of taxes, for the three months ended March 31, 2014 and 2013, respectively. No amounts recorded in accumulated other comprehensive loss are expected to be reclassified to interest expense in the next twelve months. | |||||||||
The fair value of the derivatives have been obtained from the counterparties to the agreement and were based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. The aggregate fair value of the Company’s interest rate derivative instruments was a liability of $40,000 and $54,000 at March 31, 2014 and December 31, 2013, respectively, and is included in Other long-term liabilities. | |||||||||
The Company has also entered into certain foreign exchange contracts, to primarily offset the earnings impact related to fluctuations in foreign currency exchange rates associated with inventory purchases denominated in foreign currencies. Although these foreign exchange contracts have not been designated as hedges as required in order to apply hedge accounting, the contracts are effective from an economic perspective. The changes in the fair value of these contracts are recorded in earnings immediately. A gain of approximately $2,000 is included within Selling, general and administrative expenses in the Condensed Consolidated Statement of Operations for the three months ended March 31, 2014. | |||||||||
The aggregate gross notional amount of foreign exchange contracts at March 31, 2014 was $12.9 million. The fair value of the Company’s foreign exchange contracts was a liability of $738,000 and is included within Other long-term liabilities in the Condensed Consolidated Balance Sheet. The fair value of the derivatives have been obtained from the counterparties to the agreement and were based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. | |||||||||
Employee Healthcare | |||||||||
The Company self-insures certain portions of its health insurance plan. The Company maintains an accrual for unpaid claims and estimated claims incurred but not yet reported (“IBNR”). Although management believes that it uses the best information available to estimate claims IBNR, actual claims may vary significantly from estimated claims. | |||||||||
Adoption of New Accounting Pronouncements | |||||||||
Effective January 1, 2013, the Company adopted ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under GAAP to be reclassified in their entirety to net income (e.g., net periodic pension benefit cost), an entity is required to cross-reference to other disclosures required under GAAP that provide additional detail about those amounts. In connection with the adoption of this standard, the Company added additional disclosure about the Company’s accumulated other comprehensive income to Note K of its financial statements. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
ACQUISITIONS | ' | ||||||||
NOTE B —ACQUISITIONS | |||||||||
Kitchen Craft | |||||||||
On January 15, 2014, the Company acquired 100% of the share capital of Thomas Plant (Birmingham) Limited (“Kitchen Craft”) for cash in the amount of £37.4 million ($61.5 million) and 581,432 shares of common stock of the Company with an intrinsic value of £5.5 million ($9.0 million). The purchase price also includes contingent cash consideration of up to £5.5 million ($9.0 million) which will be payable in future years if Kitchen Craft achieves certain financial targets. Kitchen Craft is a leading supplier of kitchenware products and accessories in the United Kingdom. The assets, liabilities and operating results of Kitchen Craft are reflected in the Company’s condensed consolidated financial statements in accordance with ASC Topic No. 805, Business Combinations, commencing from the acquisition date. | |||||||||
The purchase price has been determined to be as follows (in thousands): | |||||||||
Cash | $ | 61,302 | |||||||
Share consideration issued(1) | 8,382 | ||||||||
Value of contingent consideration(2) | 2,488 | ||||||||
Estimated working capital adjustment(3) | 663 | ||||||||
Total purchase price | $ | 72,835 | |||||||
-1 | Share consideration issued is valued at the closing market price discounted to account for lack of marketability related to the lock up period as described in the share purchase agreement. | ||||||||
-2 | The value of contingent consideration represents the present value of the estimated payments related to the attainment of certain financial targets for the years 2014 through 2016. The maximum undiscounted deferred and contingent consideration to be paid on the agreement is £5.5 million ($9.0 million). | ||||||||
-3 | Estimated working capital adjustment represents the estimated future payment to be made as defined in the share purchase agreement. | ||||||||
The purchase price was allocated based on the Company’s preliminary estimate of the fair value of the assets acquired and liabilities assumed, as follows (in thousands): | |||||||||
Purchase Price | |||||||||
Allocation | |||||||||
Accounts Receivable (1) | $ | 14,258 | |||||||
Inventory | 17,912 | ||||||||
Other assets | 3,650 | ||||||||
Other liabilities | (9,197 | ) | |||||||
Deferred income tax | (8,988 | ) | |||||||
Goodwill and other intangibles | 55,200 | ||||||||
Total allocated value | $ | 72,835 | |||||||
-1 | The fair value of accounts receivable approximated the gross contractual amounts receivable. | ||||||||
Goodwill results from such factors as an assembled workforce. The total amount of goodwill is not expected to be deductible for tax purposes. All of the goodwill and other intangible assets are included in the Wholesale Segment. Customer relationships and trade names are amortized on a straight-line basis over their estimated useful lives (see Note D). | |||||||||
Unaudited Pro forma Results | |||||||||
The three months ended March 31, 2014 includes the operations of Kitchen Craft for the period from January 15, 2014 to March 31, 2014. The condensed consolidated statement of operations for the three months ended March 31, 2014, include $16.9 million of net sales and $0.4 million of net income contributed by Kitchen Craft. | |||||||||
The following table presents the Company’s pro forma consolidated net sales and income (loss) before income taxes and equity in earnings for the three months ended March 31, 2014 and March 31, 2013. The unaudited pro forma results include the historical statement of operations information of the Company and of Kitchen Craft, giving effect to the Kitchen Craft acquisition and related financing as if they had occurred at the beginning of the period presented. As described below, the Company consummated certain other acquisitions during the three months ended March 31, 2014; however the Company has not included the results prior to their acquisition in these pro forma results as the impact would not have been material. | |||||||||
Unaudited pro forma results | |||||||||
Three Months Ended | |||||||||
March 31, 2014 | March 31, 2013 | ||||||||
(In thousands, except per share data) | |||||||||
Net Sales | $ | 118,411 | $ | 113,629 | |||||
Loss before income taxes and equity in earnings | (2,510 | ) | (585 | ) | |||||
Net loss | (2,077 | ) | (21 | ) | |||||
Basic and diluted loss per common share | $ | (0.16 | ) | $ | (0.00 | ) | |||
The pro forma results, prepared in accordance with U.S. GAAP, include the following pro forma adjustments related to the Kitchen Craft acquisition: | |||||||||
(i) | as a result of a $0.9 million increase in the fair value of acquired inventory at the acquisition date, the Company recorded a $0.5 million charge in cost of sales in the three months ended March 31, 2014 condensed consolidated financial statements. The pro forma adjustments reflect the elimination of this charge; | ||||||||
(ii) | an increase in amortization expense related to the fair value of the identifiable intangible assets of $0.9 million in the three months ended March 31, 2013; | ||||||||
(iii) | the elimination of acquisition costs recorded in the three months ended March 31, 2014 of $0.9 million; | ||||||||
(iv) | an increase in interest expense and amortization of debt issuance costs of $0.5 million, resulting from the refinancing of the Company’s debt to finance the acquisition in the three months ended March 31, 2013; | ||||||||
(v) | an adjustment to conform compensation expense to the Company’s current compensation policies. | ||||||||
The unaudited pro forma results do not include any revenue or cost reductions that may be achieved through the business combination, or the impact of non-recurring items directly related to the business combination. | |||||||||
The unaudited pro forma results are not necessarily indicative of the operating results that would have occurred if the Kitchen Craft acquisition had been completed as of the date for which the pro forma financial information is presented. In addition, the unaudited pro forma results do not purport to project the future condensed consolidated operating results of the combined company. | |||||||||
Other acquisitions | |||||||||
In February 2014, the Company acquired certain assets of Built NY, Inc. (“Built NY”), including inventory, trademarks and other intellectual property. Also in February 2014 the Company acquired certain assets of Empire Silver Company, Inc. (“Empire Silver”), including trademarks and other intellectual property. In March 2014, the Company acquired the business and certain assets of La Cafetière Inc., La Cafetière UK (Limited) and Cafetière B.V. (collectively “La Cafetière”), including trademarks and other intellectual property, inventory and certain receivables. In aggregate, the Company paid approximately $5.3 million of primarily cash consideration for these acquisitions. The assets, liabilities and operating results of the acquisitions are reflected in the Company’s condensed consolidated financial statements in accordance with ASC Topic No. 805, Business Combinations, commencing from the acquisition dates. | |||||||||
INVESTMENTS
INVESTMENTS | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
INVESTMENTS | ' | ||||||||||||||||
NOTE C —INVESTMENTS | |||||||||||||||||
The Company owns approximately a 30% interest in Grupo Vasconia S.A.B. (“Vasconia”), an integrated manufacturer of aluminum products and one of Mexico’s largest housewares companies. Shares of Vasconia’s capital stock are traded on the Bolsa Mexicana de Valores, the Mexican Stock Exchange (www.bmv.com.mx). The Quotation Key is VASCONI. The Company accounts for its investment in Vasconia using the equity method of accounting and records its proportionate share of Vasconia’s net income in the Company’s statement of operations. Accordingly, the Company has recorded its proportionate share of Vasconia’s net income (reduced for amortization expense related to the customer relationships acquired) for the three month periods ended March 31, 2014 and 2013 in the accompanying condensed consolidated statements of operations. The value of the Company’s investment balance has been translated from Mexican Pesos (“MXN”) to U.S. Dollars (“USD”) using the spot rate of MXN 13.06 and MXN 12.34 at March 31, 2014 and 2013, respectively. The Company’s proportionate share of Vasconia’s net income has been translated from MXN to USD using the average exchange rate of MXN 13.23 and MXN 12.70 during the three months ended March 31, 2014 and 2013, respectively. The effect of the translation of the Company’s investment resulted in a decrease of the investment of $11,000 and an increase of $1.7 million during the three months ended March 31, 2014 and 2013, respectively (also see Note K). These translation effects are recorded in accumulated other comprehensive loss. Included in prepaid expenses and other current assets at March 31, 2014 are amounts due from Vasconia of $36,000. Included within accrued expenses at March 31, 2014 and December 31, 2013 are amounts due to Vasconia of $8,000 and $152,000, respectively. | |||||||||||||||||
Summarized statement of operations information for Vasconia in USD and MXN for the periods indicated is as follows: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(in thousands) | |||||||||||||||||
USD | MXN | USD | MXN | ||||||||||||||
Net sales | $ | 43,258 | $ | 572,196 | $ | 40,240 | $ | 510,879 | |||||||||
Gross profit | 7,839 | 103,697 | 7,917 | 100,519 | |||||||||||||
Income from operations | 1,754 | 23,207 | 2,140 | 27,169 | |||||||||||||
Net income | 109 | 1,438 | 1,226 | 15,568 | |||||||||||||
The Company recorded equity in earnings of Vasconia, net of taxes, of $41,000 and $0.3 million for the three months ended March 31, 2014 and 2013, respectively. | |||||||||||||||||
As of March 31, 2014 and December 31, 2013, the fair value (based upon the quoted stock price) of the Company’s investment in Vasconia was $35.2 million, in both periods. The carrying value of the Company’s investment in Vasconia was $30.5 million as of March 31, 2014 and December 31, 2013, in both periods. | |||||||||||||||||
The Company owns a 40% equity interest in GS Internacional S/A (“GSI”), a leading wholesale distributor of branded housewares products in Brazil, which the Company acquired in December 2011. The Company recorded equity in losses of GSI of $213,000 and $23,000, net of taxes, for the three months ended March 31, 2014 and 2013, respectively. |
INTANGIBLE_ASSETS
INTANGIBLE ASSETS | 3 Months Ended | ||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||
INTANGIBLE ASSETS | ' | ||||||||||||||||||||||||
NOTE D — INTANGIBLE ASSETS | |||||||||||||||||||||||||
Intangible assets consist of the following (in thousands): | |||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||||
Amortization | Amortization | ||||||||||||||||||||||||
Goodwill | $ | 18,355 | — | $ | 18,355 | $ | 5,085 | — | $ | 5,085 | |||||||||||||||
Indefinite-lived intangible assets: | |||||||||||||||||||||||||
Trade names | 18,364 | — | 18,364 | 18,364 | — | 18,364 | |||||||||||||||||||
Finite-lived intangible assets: | |||||||||||||||||||||||||
Licenses | 15,847 | (7,665 | ) | 8,182 | 15,847 | (7,551 | ) | 8,296 | |||||||||||||||||
Trade names | 22,709 | (3,094 | ) | 19,615 | 10,056 | (2,677 | ) | 7,379 | |||||||||||||||||
Customer relationships | 50,432 | (3,705 | ) | 46,727 | 18,406 | (2,736 | ) | 15,670 | |||||||||||||||||
Other | 1,202 | (277 | ) | 925 | 584 | (229 | ) | 355 | |||||||||||||||||
Total | $ | 126,909 | $ | (14,741 | ) | $ | 112,168 | $ | 68,342 | $ | (13,193 | ) | $ | 55,149 | |||||||||||
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2014 | |
DEBT | ' |
NOTE E — DEBT | |
Credit Agreement | |
The Company has a $175.0 million secured credit agreement (the “Revolving Credit Facility”), with a bank group led by JPMorgan Chase Bank, N.A. In January 2014, the Company entered into a Second Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A (“Second Amended and Restated Credit Agreement”). The Second Amended and Restated Credit Agreement provides for, among other things, (i) an extension of the maturity of the $175.0 million Revolving Credit Facility to January 11, 2019 and (ii) a new Term Loan facility of $50.0 million. | |
Borrowings under the Revolving Credit Facility bear interest, at the following rates: (i) the Alternate Base Rate, defined as the greater of the Prime Rate, Federal Funds Rate plus 0.5% or the Adjusted LIBO Rate plus 1.0%, plus a margin of 0.75% to 1.25%, or (ii) the Eurodollar Rate, defined as the Adjusted LIBO Rate plus a margin of 1.75% to 2.25%. The respective margins are based upon availability. Interest rates on outstanding borrowings at March 31, 2014 ranged from 2.125% to 4.25%. In addition, the Company pays a commitment fee of 0.375% on the unused portion of the Revolving Credit Facility. | |
At March 31, 2014, borrowings outstanding under the Revolving Credit Facility were $84.4 million and open letters of credit were $4.2 million. Availability under the Revolving Credit Facility was approximately $53.7 million, or 31% of the total loan commitment at March 31, 2014. | |
The Company classifies a portion of the Revolving Credit Facility as a current liability if the Company’s intent and ability is to repay the loan from cash flows from operations which are expected to occur within the next 12 months. Repayments and borrowings under the facility can vary significantly from planned levels based on cash flow needs and general economic conditions. The Company expects that it will continue to borrow and repay funds, subject to availability, under the facility based on working capital and other corporate needs. | |
ABR Term Loans or Eurocurrency Term Loans, provided for under the Second Amended and Restated Credit Agreement, bear interest based on the applicable Senior Leverage Ratio. The ABR Spread for Term Loans is 3.0% to 3.5% and the Spread for Eurocurrency Term Loans is 4.0% to 4.5%. As of March 31, 2014, $50.0 million was outstanding under the Term Loan. | |
The Second Amended and Restated Credit Agreement provides for customary restrictions and events of default. Restrictions include limitations on additional indebtedness, acquisitions, investments and payment of dividends, among other things. Further, the Second Amended and Restated Credit Agreement provides that at any time the Term Loans are outstanding or at anytime availability is less than $17.5 million, the Company maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 for any four consecutive fiscal quarters and provides that when the Term Loan is outstanding, the Company maintain a Senior Leverage Ratio within defined parameters of, 3.75 to 1.00 at each fiscal quarter end during 2014; 3.00 to 1.00 at each fiscal quarter end in 2015; and 2.50 to 1.00 at each fiscal quarter end thereafter. Notwithstanding the foregoing, for any fiscal quarter ending on September 30, the Senior Leverage Ratio shall be increased by an additional 0.25:1.00. | |
The Company was in compliance with the financial covenants of the Second Amended and Restated Credit Agreement at March 31, 2014. | |
In January 2014, the Company repaid the Senior Secured Term Loan in connection with the Second Amended and Restated Credit Agreement. |
STOCK_COMPENSATION
STOCK COMPENSATION | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
STOCK COMPENSATION | ' | ||||||||||||||||
NOTE F — STOCK COMPENSATION | |||||||||||||||||
A summary of the Company’s stock option activity and related information for the three months ended March 31, 2014 is as follows: | |||||||||||||||||
Options | Weighted- | Weighted- | Aggregate | ||||||||||||||
average | average | intrinsic | |||||||||||||||
exercise price | remaining | value | |||||||||||||||
contractual | |||||||||||||||||
life (years) | |||||||||||||||||
Options outstanding, January 1, 2014 | 2,371,650 | $ | 12.75 | ||||||||||||||
Grants | 100,000 | 18.04 | |||||||||||||||
Exercises | (105,213 | ) | 11.41 | ||||||||||||||
Cancellations | (5,000 | ) | 15.6 | ||||||||||||||
Options outstanding, March 31, 2014 | 2,361,437 | 13.03 | 6.16 | $ | 14,624,245 | ||||||||||||
Options exercisable, March 31, 2014 | 1,450,637 | 13.21 | 5.09 | $ | 9,948,309 | ||||||||||||
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value that would have been received by the option holders had all option holders exercised their stock options on March 31, 2014. The intrinsic value is calculated for each in-the-money stock option as the difference between the closing price of the Company’s common stock on March 31, 2014 and the exercise price. | |||||||||||||||||
The total intrinsic value of stock options exercised for the three months ended March 31, 2014 and 2013 was $668,279 and $427,100, respectively. The intrinsic value of a stock option that is exercised is calculated at the date of exercise. | |||||||||||||||||
The Company recognized stock compensation expense of $726,000 and $671,000 for the three months ended March 31, 2014 and 2013, respectively. | |||||||||||||||||
Total unrecognized compensation cost related to unvested stock options at March 31, 2014, before the effect of income taxes, was $4.0 million and is expected to be recognized over a weighted-average period of 2.71 years. | |||||||||||||||||
At March 31, 2014, there were 548,073 shares available for awards that could be granted under the Company’s 2000 Long-Term Incentive Plan. |
LOSS_PER_COMMON_SHARE
LOSS PER COMMON SHARE | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
LOSS PER COMMON SHARE | ' | ||||||||
NOTE G — LOSS PER COMMON SHARE | |||||||||
Basic loss per common share has been computed by dividing net loss by the weighted-average number of shares of the Company’s common stock outstanding. Diluted loss per common share adjusts net loss and basic loss per common share for the effect of all potentially dilutive shares of the Company’s common stock. The calculations of basic and diluted loss per common share for the three month periods ended March 31, 2014 and 2013 are as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands, except per share amounts) | |||||||||
Net loss—basic and diluted | $ | (2,929 | ) | $ | (632 | ) | |||
Weighted-average shares outstanding—basic and diluted | 13,274 | 12,761 | |||||||
Basic and diluted loss per common share | $ | (0.22 | ) | $ | (0.05 | ) | |||
The computation of diluted loss per common share for the three months ended March 31, 2014 and 2013 excludes the shares underlying options to purchase 2,361,437 shares and 2,518,780 shares, respectively. These shares were excluded due to their antidilutive effects. |
INCOME_TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2014 | |
INCOME TAXES | ' |
NOTE H — INCOME TAXES | |
On a quarterly basis, the Company evaluates its tax positions and revises its estimates accordingly. The Company believes that $143,000 of its tax positions will be resolved within the next twelve months. | |
The Company has identified the following jurisdictions as “major” tax jurisdictions: U.S. Federal, California, Massachusetts, New York, Illinois, New Jersey and the United Kingdom. The Company is no longer subject to U.S. Federal income tax examinations for the years prior to 2011. At March 31, 2014, the periods subject to examination for the Company’s major state jurisdictions are the years ended 2009 through 2013. | |
The Company’s policy for recording interest and penalties is to record such items as a component of income taxes. Interest and penalties were not material to the Company’s financial position, results of operations or cash flows as of and for the three months ended March 31, 2014 and 2013. |
BUSINESS_SEGMENTS
BUSINESS SEGMENTS | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
BUSINESS SEGMENTS | ' | ||||||||
NOTE I — BUSINESS SEGMENTS | |||||||||
The Company operates in two reportable business segments: the Wholesale segment, the Company’s primary business segment, in which the Company designs, markets and distributes products to retailers and distributors, and the Retail Direct segment, in which the Company markets and sells a limited selection of its products directly to consumers through its Pfaltzgraff®, Mikasa® and Lifetime Sterling® Internet websites. The operating results of Kitchen Craft, since the date of the acquisition, are included in the Wholesale segment. | |||||||||
The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. While both segments distribute similar products, the segments have been distinct due to the different methods the Company uses to sell, market and distribute the products. Management evaluates the performance of the Wholesale and Retail Direct segments based on net sales and income (loss) from operations. Such measures give recognition to specifically identifiable operating costs such as cost of sales, distribution expenses and selling, general and administrative expenses. Certain general and administrative expenses, such as senior executive salaries and benefits, stock compensation, director fees and accounting, legal and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Net sales | |||||||||
Wholesale | $ | 113,818 | $ | 93,118 | |||||
Retail Direct | 4,593 | 5,539 | |||||||
Total net sales | $ | 118,411 | $ | 98,657 | |||||
Income (loss) from operations | |||||||||
Wholesale | $ | 2,203 | $ | 2,559 | |||||
Retail Direct | (299 | ) | 9 | ||||||
Unallocated corporate expenses | (4,101 | ) | (2,683 | ) | |||||
Total loss from operations | $ | (2,197 | ) | $ | (115 | ) | |||
Depreciation and amortization | |||||||||
Wholesale | $ | (3,549 | ) | $ | (2,458 | ) | |||
Retail Direct | (64 | ) | (65 | ) | |||||
Total depreciation and amortization | $ | (3,613 | ) | $ | (2,523 | ) | |||
CONTINGENCIES
CONTINGENCIES | 3 Months Ended |
Mar. 31, 2014 | |
CONTINGENCIES | ' |
NOTE J — CONTINGENCIES | |
Wallace Silversmiths de Puerto Rico, Ltd. (“Wallace de Puerto Rico”), a wholly-owned subsidiary of the Company, operates a manufacturing facility in San Germán, Puerto Rico that is leased from the Puerto Rico Industrial Development Company (“PRIDCO”). In March 2008, the United States Environmental Protection Agency (the “EPA”) announced that the San Germán Ground Water Contamination site in Puerto Rico (the “Site”) had been added to the Superfund National Priorities List due to contamination present in the local drinking water supply. | |
In May 2008, Wallace de Puerto Rico received from the EPA a Notice of Potential Liability and Request for Information Pursuant to 42 U.S.C. Sections 9607(a) and 9604(e) of the Comprehensive Environmental Response, Compensation, Liability Act. The Company responded to the EPA’s Request for Information on behalf of Wallace de Puerto Rico. In July 2011, Wallace de Puerto Rico received a letter from the EPA requesting access to the property that it leases from PRIDCO, and the Company granted such access. In February, 2013, the EPA requested access to conduct further environmental investigation at the property. The Company granted such access and further EPA investigation is pending. | |
The Company is not aware of any determination by the EPA that any remedial action is required for the Site, and, accordingly, is not able to estimate the extent of any possible liability. | |
The Company is, from time to time, involved in other legal proceedings. The Company believes that other current litigation is routine in nature and incidental to the conduct of the Company’s business and that none of this litigation, individually or collectively, would have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. |
OTHER
OTHER | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
OTHER | ' | ||||||||
NOTE K — OTHER | |||||||||
Cash dividends | |||||||||
On March 11, 2014, the Board of Directors declared a quarterly dividend of $0.0375 per share payable on May 15, 2014 to shareholders of record on May 1, 2014. As of March 31, 2014, the Company accrued $505,000 for the payment of the dividend. | |||||||||
Supplemental cash flow information | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Supplemental disclosure of cash flow information: | |||||||||
Cash paid for interest | $ | 1,099 | $ | 908 | |||||
Cash paid for taxes | 4,340 | 4,375 | |||||||
Non-cash investing activities: | |||||||||
Translation adjustment | $ | (690 | ) | $ | (1,125 | ) | |||
Components of accumulated other comprehensive loss, net | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accumulated translation adjustment: | |||||||||
Balance at beginning of period | $ | (2,944 | ) | $ | (2,804 | ) | |||
Translation gain during period | 690 | 1,125 | |||||||
Balance at end of period | $ | (2,254 | ) | $ | (1,679 | ) | |||
Accumulated effect of retirement benefit obligations: | |||||||||
Balance at beginning of period | $ | (745 | ) | $ | (1,160 | ) | |||
Amounts reclassified from accumulated other comprehensive loss: | |||||||||
Amortization of actuarial losses, net of tax of $5 and $9 for the three months ended March 31, 2014 and 2013, respectively (1) | 7 | 13 | |||||||
Balance at end of period | $ | (738 | ) | $ | (1,147 | ) | |||
Accumulated deferred losses on cash flow hedges: | |||||||||
Balance at beginning of period | $ | (31 | ) | $ | (272 | ) | |||
Derivative fair value adjustment, net of tax of $6 and $9 for the three months ended March 31, 2014 and 2013, respectively | 9 | 13 | |||||||
Balance at end of period | $ | (22 | ) | $ | (259 | ) | |||
-1 | Amounts are recorded in selling, general and administrative expense on the Condensed consolidated statements of operations. |
BASIS_OF_PRESENTATION_AND_SUMM1
BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES (Policies) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Basis of presentation | ' | ||||||||
Basis of presentation | |||||||||
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring accruals, considered necessary for a fair presentation have been included. These condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013. Operating results for the three month period ended March 31, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. | |||||||||
The Company’s business and working capital needs are highly seasonal, with a majority of sales occurring in the third and fourth quarters. In 2013 and 2012, net sales for the third and fourth quarters accounted for 61% and 58% of total annual net sales, respectively. In anticipation of the pre-holiday shipping season, inventory levels increase primarily in the June through October time period. | |||||||||
Revenue recognition | ' | ||||||||
Revenue recognition | |||||||||
The Company sells products wholesale, to retailers and distributors, and retail, directly to the consumer. Wholesale sales and retail sales are recognized when title passes to the customer, which is primarily at the shipping point for wholesale sales and upon delivery to the customer for retail sales. Shipping and handling fees that are billed to customers in sales transactions are included in net sales and amounted to $370,000 and $441,000 for the three months ended March 31, 2014 and 2013, respectively. Net sales exclude taxes that are collected from customers and remitted to the taxing authorities. | |||||||||
The Company offers various sales incentives and promotional programs to its customers from time to time in the normal course of business. These incentives and promotions typically include arrangements such as cooperative advertising, buydowns, volume rebates and discounts. These arrangements and an estimate of sales returns are reflected as reductions in net sales in the Company’s condensed consolidated statements of operations. | |||||||||
Distribution expenses | ' | ||||||||
Distribution expenses | |||||||||
Distribution expenses consist primarily of warehousing expenses and freight-out expenses. | |||||||||
Inventory | ' | ||||||||
Inventory | |||||||||
Inventory consists principally of finished goods sourced from third-party suppliers. Inventory also includes finished goods, work in process and raw materials related to the Company’s manufacture of sterling silver products. Inventory is priced by the lower of cost (first-in, first-out basis) or market method. The Company estimates the selling price of its inventory on a product by product basis based on the current selling environment. If the estimated selling price is lower than the inventory’s cost, the Company reduces the value of the inventory to its net realizable value. | |||||||||
The components of inventory are as follows: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Finished goods | $ | 132,836 | $ | 108,340 | |||||
Work in process | 1,896 | 1,966 | |||||||
Raw materials | 1,652 | 2,485 | |||||||
Total | $ | 136,384 | $ | 112,791 | |||||
Fair value of financial instruments | ' | ||||||||
Fair value of financial instruments | |||||||||
The Company determined the carrying amounts of cash and cash equivalents, accounts receivable and accounts payable are reasonable estimates of their fair values because of their short-term nature. The Company determined that the carrying amounts of borrowings outstanding under its revolving credit facility, credit agreement term loan and senior secured term loan approximate fair value since such borrowings bear interest at variable market rates. | |||||||||
Derivatives | ' | ||||||||
Derivatives | |||||||||
The Company accounts for derivative instruments in accordance with ASC Topic No. 815, Derivatives and Hedging. ASC Topic No. 815 requires that all derivative instruments be recognized on the balance sheet at fair value as either an asset or liability. Changes in the fair value of derivatives that qualify as hedges and have been designated as part of a hedging relationship for accounting purposes have no net impact on earnings to the extent the derivative is considered highly effective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, until the hedge item is recognized in earnings. If the derivative which is designated as part of a hedging relationship is considered ineffective in achieving offsetting changes in fair value or cash flows attributable to the risk being hedged, the changes in fair value are recorded in operations. For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in operations. | |||||||||
The Company is a party to interest rate swap agreements with an aggregate notional amount of $28.9 million to manage interest rate exposure in connection with its variable interest rate borrowings. The hedge period in the agreements commenced in March 2013 and expires in June 2018 and the notional amount amortizes over this period. The interest rate swap agreements were designated as a cash flow hedge under ASC Topic No. 815. The effective portion of the fair value gain or loss on these agreements are recorded as a component of accumulated other comprehensive loss. The effect of recording these derivatives at fair value resulted in an unrealized gain of $9,000 and $13,000, net of taxes, for the three months ended March 31, 2014 and 2013, respectively. No amounts recorded in accumulated other comprehensive loss are expected to be reclassified to interest expense in the next twelve months. | |||||||||
The fair value of the derivatives have been obtained from the counterparties to the agreement and were based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. The aggregate fair value of the Company’s interest rate derivative instruments was a liability of $40,000 and $54,000 at March 31, 2014 and December 31, 2013, respectively, and is included in Other long-term liabilities. | |||||||||
The Company has also entered into certain foreign exchange contracts, to primarily offset the earnings impact related to fluctuations in foreign currency exchange rates associated with inventory purchases denominated in foreign currencies. Although these foreign exchange contracts have not been designated as hedges as required in order to apply hedge accounting, the contracts are effective from an economic perspective. The changes in the fair value of these contracts are recorded in earnings immediately. A gain of approximately $2,000 is included within Selling, general and administrative expenses in the Condensed Consolidated Statement of Operations for the three months ended March 31, 2014. | |||||||||
The aggregate gross notional amount of foreign exchange contracts at March 31, 2014 was $12.9 million. The fair value of the Company’s foreign exchange contracts was a liability of $738,000 and is included within Other long-term liabilities in the Condensed Consolidated Balance Sheet. The fair value of the derivatives have been obtained from the counterparties to the agreement and were based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. | |||||||||
Employee Healthcare | ' | ||||||||
Employee Healthcare | |||||||||
The Company self-insures certain portions of its health insurance plan. The Company maintains an accrual for unpaid claims and estimated claims incurred but not yet reported (“IBNR”). Although management believes that it uses the best information available to estimate claims IBNR, actual claims may vary significantly from estimated claims. | |||||||||
Adoption of New Accounting Pronouncements | ' | ||||||||
Adoption of New Accounting Pronouncements | |||||||||
Effective January 1, 2013, the Company adopted ASU No. 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income but only if the amount reclassified is required under GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under GAAP to be reclassified in their entirety to net income (e.g., net periodic pension benefit cost), an entity is required to cross-reference to other disclosures required under GAAP that provide additional detail about those amounts. In connection with the adoption of this standard, the Company added additional disclosure about the Company’s accumulated other comprehensive income to Note K of its financial statements. |
BASIS_OF_PRESENTATION_AND_SUMM2
BASIS OF PRESENTATION AND SUMMARY ACCOUNTING POLICIES (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Components of Inventory | ' | ||||||||
The components of inventory are as follows: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Finished goods | $ | 132,836 | $ | 108,340 | |||||
Work in process | 1,896 | 1,966 | |||||||
Raw materials | 1,652 | 2,485 | |||||||
Total | $ | 136,384 | $ | 112,791 | |||||
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Unaudited Pro Forma Include the Historical Statement of Operation | ' | ||||||||
The following table presents the Company’s pro forma consolidated net sales and income (loss) before income taxes and equity in earnings for the three months ended March 31, 2014 and March 31, 2013. The unaudited pro forma results include the historical statement of operations information of the Company and of Kitchen Craft, giving effect to the Kitchen Craft acquisition and related financing as if they had occurred at the beginning of the period presented. As described below, the Company consummated certain other acquisitions during the three months ended March 31, 2014; however the Company has not included the results prior to their acquisition in these pro forma results as the impact would not have been material. | |||||||||
Unaudited pro forma results | |||||||||
Three Months Ended | |||||||||
March 31, 2014 | March 31, 2013 | ||||||||
(In thousands, except per share data) | |||||||||
Net Sales | $ | 118,411 | $ | 113,629 | |||||
Loss before income taxes and equity in earnings | (2,510 | ) | (585 | ) | |||||
Net loss | (2,077 | ) | (21 | ) | |||||
Basic and diluted loss per common share | $ | (0.16 | ) | $ | (0.00 | ) | |||
Thomas Plant | ' | ||||||||
Purchase Price | ' | ||||||||
The purchase price has been determined to be as follows (in thousands): | |||||||||
Cash | $ | 61,302 | |||||||
Share consideration issued(1) | 8,382 | ||||||||
Value of contingent consideration(2) | 2,488 | ||||||||
Estimated working capital adjustment(3) | 663 | ||||||||
Total purchase price | $ | 72,835 | |||||||
-1 | Share consideration issued is valued at the closing market price discounted to account for lack of marketability related to the lock up period as described in the share purchase agreement. | ||||||||
-2 | The value of contingent consideration represents the present value of the estimated payments related to the attainment of certain financial targets for the years 2014 through 2016. The maximum undiscounted deferred and contingent consideration to be paid on the agreement is £5.5 million ($9.0 million). | ||||||||
-3 | Estimated working capital adjustment represents the estimated future payment to be made as defined in the share purchase agreement. | ||||||||
The purchase price was allocated based on the Company’s preliminary estimate of the fair value of the assets acquired and liabilities assumed, as follows (in thousands): | |||||||||
Purchase Price | |||||||||
Allocation | |||||||||
Accounts Receivable (1) | $ | 14,258 | |||||||
Inventory | 17,912 | ||||||||
Other assets | 3,650 | ||||||||
Other liabilities | (9,197 | ) | |||||||
Deferred income tax | (8,988 | ) | |||||||
Goodwill and other intangibles | 55,200 | ||||||||
Total allocated value | $ | 72,835 | |||||||
-1 | The fair value of accounts receivable approximated the gross contractual amounts receivable. |
INVESTMENTS_Tables
INVESTMENTS (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Summarized Statement of Operations Information for Vasconia in USD and MXN | ' | ||||||||||||||||
Summarized statement of operations information for Vasconia in USD and MXN for the periods indicated is as follows: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
(in thousands) | |||||||||||||||||
USD | MXN | USD | MXN | ||||||||||||||
Net sales | $ | 43,258 | $ | 572,196 | $ | 40,240 | $ | 510,879 | |||||||||
Gross profit | 7,839 | 103,697 | 7,917 | 100,519 | |||||||||||||
Income from operations | 1,754 | 23,207 | 2,140 | 27,169 | |||||||||||||
Net income | 109 | 1,438 | 1,226 | 15,568 |
INTANGIBLE_ASSETS_Tables
INTANGIBLE ASSETS (Tables) | 3 Months Ended | ||||||||||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||||||||||
Components of Intangible Assets | ' | ||||||||||||||||||||||||
Intangible assets consist of the following (in thousands): | |||||||||||||||||||||||||
March 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||||
Amortization | Amortization | ||||||||||||||||||||||||
Goodwill | $ | 18,355 | — | $ | 18,355 | $ | 5,085 | — | $ | 5,085 | |||||||||||||||
Indefinite-lived intangible assets: | |||||||||||||||||||||||||
Trade names | 18,364 | — | 18,364 | 18,364 | — | 18,364 | |||||||||||||||||||
Finite-lived intangible assets: | |||||||||||||||||||||||||
Licenses | 15,847 | (7,665 | ) | 8,182 | 15,847 | (7,551 | ) | 8,296 | |||||||||||||||||
Trade names | 22,709 | (3,094 | ) | 19,615 | 10,056 | (2,677 | ) | 7,379 | |||||||||||||||||
Customer relationships | 50,432 | (3,705 | ) | 46,727 | 18,406 | (2,736 | ) | 15,670 | |||||||||||||||||
Other | 1,202 | (277 | ) | 925 | 584 | (229 | ) | 355 | |||||||||||||||||
Total | $ | 126,909 | $ | (14,741 | ) | $ | 112,168 | $ | 68,342 | $ | (13,193 | ) | $ | 55,149 | |||||||||||
STOCK_COMPENSATION_Tables
STOCK COMPENSATION (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Summary of Stock Option Activity and Related Information | ' | ||||||||||||||||
A summary of the Company’s stock option activity and related information for the three months ended March 31, 2014 is as follows: | |||||||||||||||||
Options | Weighted- | Weighted- | Aggregate | ||||||||||||||
average | average | intrinsic | |||||||||||||||
exercise price | remaining | value | |||||||||||||||
contractual | |||||||||||||||||
life (years) | |||||||||||||||||
Options outstanding, January 1, 2014 | 2,371,650 | $ | 12.75 | ||||||||||||||
Grants | 100,000 | 18.04 | |||||||||||||||
Exercises | (105,213 | ) | 11.41 | ||||||||||||||
Cancellations | (5,000 | ) | 15.6 | ||||||||||||||
Options outstanding, March 31, 2014 | 2,361,437 | 13.03 | 6.16 | $ | 14,624,245 | ||||||||||||
Options exercisable, March 31, 2014 | 1,450,637 | 13.21 | 5.09 | $ | 9,948,309 | ||||||||||||
LOSS_PER_COMMON_SHARE_Tables
LOSS PER COMMON SHARE (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Calculations of Basic and Diluted loss Per Common Share | ' | ||||||||
The calculations of basic and diluted loss per common share for the three month periods ended March 31, 2014 and 2013 are as follows: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands, except per share amounts) | |||||||||
Net loss—basic and diluted | $ | (2,929 | ) | $ | (632 | ) | |||
Weighted-average shares outstanding—basic and diluted | 13,274 | 12,761 | |||||||
Basic and diluted loss per common share | $ | (0.22 | ) | $ | (0.05 | ) | |||
BUSINESS_SEGMENTS_Tables
BUSINESS SEGMENTS (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Segment Reporting Information | ' | ||||||||
The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. While both segments distribute similar products, the segments have been distinct due to the different methods the Company uses to sell, market and distribute the products. Management evaluates the performance of the Wholesale and Retail Direct segments based on net sales and income (loss) from operations. Such measures give recognition to specifically identifiable operating costs such as cost of sales, distribution expenses and selling, general and administrative expenses. Certain general and administrative expenses, such as senior executive salaries and benefits, stock compensation, director fees and accounting, legal and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Net sales | |||||||||
Wholesale | $ | 113,818 | $ | 93,118 | |||||
Retail Direct | 4,593 | 5,539 | |||||||
Total net sales | $ | 118,411 | $ | 98,657 | |||||
Income (loss) from operations | |||||||||
Wholesale | $ | 2,203 | $ | 2,559 | |||||
Retail Direct | (299 | ) | 9 | ||||||
Unallocated corporate expenses | (4,101 | ) | (2,683 | ) | |||||
Total loss from operations | $ | (2,197 | ) | $ | (115 | ) | |||
Depreciation and amortization | |||||||||
Wholesale | $ | (3,549 | ) | $ | (2,458 | ) | |||
Retail Direct | (64 | ) | (65 | ) | |||||
Total depreciation and amortization | $ | (3,613 | ) | $ | (2,523 | ) | |||
OTHER_Tables
OTHER (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Supplemental Cash Flow Information | ' | ||||||||
Supplemental cash flow information | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Supplemental disclosure of cash flow information: | |||||||||
Cash paid for interest | $ | 1,099 | $ | 908 | |||||
Cash paid for taxes | 4,340 | 4,375 | |||||||
Non-cash investing activities: | |||||||||
Translation adjustment | $ | (690 | ) | $ | (1,125 | ) | |||
Components of Accumulated Other Comprehensive Loss, Net | ' | ||||||||
Components of accumulated other comprehensive loss, net | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
(in thousands) | |||||||||
Accumulated translation adjustment: | |||||||||
Balance at beginning of period | $ | (2,944 | ) | $ | (2,804 | ) | |||
Translation gain during period | 690 | 1,125 | |||||||
Balance at end of period | $ | (2,254 | ) | $ | (1,679 | ) | |||
Accumulated effect of retirement benefit obligations: | |||||||||
Balance at beginning of period | $ | (745 | ) | $ | (1,160 | ) | |||
Amounts reclassified from accumulated other comprehensive loss: | |||||||||
Amortization of actuarial losses, net of tax of $5 and $9 for the three months ended March 31, 2014 and 2013, respectively (1) | 7 | 13 | |||||||
Balance at end of period | $ | (738 | ) | $ | (1,147 | ) | |||
Accumulated deferred losses on cash flow hedges: | |||||||||
Balance at beginning of period | $ | (31 | ) | $ | (272 | ) | |||
Derivative fair value adjustment, net of tax of $6 and $9 for the three months ended March 31, 2014 and 2013, respectively | 9 | 13 | |||||||
Balance at end of period | $ | (22 | ) | $ | (259 | ) | |||
-1 | Amounts are recorded in selling, general and administrative expense on the Condensed consolidated statements of operations. |
Recovered_Sheet1
Basis of Presentation and Summary Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | 1 Months Ended | 3 Months Ended | |||||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | |
Foreign exchange contract | Other Long Term Liabilities | Fair Value, Observable inputs, Level 2 | Fair Value, Observable inputs, Level 2 | Interest Rate Swap Agreements | Interest Rate Swap Agreements | Interest Rate Swap Agreements | |||||
Selling, general and administrative expenses | Foreign exchange contract | Other Long Term Liabilities | Other Long Term Liabilities | Cash Flow Hedging | |||||||
Schedule Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of total annual net sales in the third and fourth quarters | ' | ' | 61.00% | 58.00% | ' | ' | ' | ' | ' | ' | ' |
Shipping and handling revenue | $370,000 | $441,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount | ' | ' | ' | ' | ' | 12,900,000 | ' | ' | ' | ' | 28,900,000 |
Commencement date | ' | ' | ' | ' | ' | ' | ' | ' | '2013-03 | ' | ' |
Expiry date | ' | ' | ' | ' | ' | ' | ' | ' | 30-Jun-18 | ' | ' |
Derivative fair value adjustment gain (loss), net of tax | 9,000 | 13,000 | ' | ' | ' | ' | ' | ' | 9,000 | 13,000 | ' |
Fair value of derivative instruments, liability | ' | ' | ' | ' | ' | 738,000 | 40,000 | 54,000 | ' | ' | ' |
Change in fair value recorded in earnings | ' | ' | ' | ' | $2,000 | ' | ' | ' | ' | ' | ' |
Components_of_Inventory_Detail
Components of Inventory (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory [Line Items] | ' | ' |
Finished goods | $132,836 | $108,340 |
Work in process | 1,896 | 1,966 |
Raw materials | 1,652 | 2,485 |
Total | $136,384 | $112,791 |
Acquisitions_Additional_Inform
Acquisitions - Additional Information (Detail) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 1 Months Ended | 3 Months Ended | 3 Months Ended | |||||
Mar. 31, 2014 | Mar. 31, 2013 | Jan. 15, 2014 | Jan. 15, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Jan. 15, 2014 | Mar. 31, 2014 | Jan. 15, 2014 | Jan. 15, 2014 | Mar. 31, 2014 | |
USD ($) | USD ($) | Thomas Plant | Thomas Plant | Thomas Plant | Thomas Plant | Thomas Plant | Thomas Plant | Thomas Plant | Thomas Plant | Other Acquisitions | |
USD ($) | GBP (£) | USD ($) | USD ($) | Cost of Sales | Cost of Sales | Maximum | Maximum | USD ($) | |||
USD ($) | USD ($) | USD ($) | GBP (£) | ||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of equity interests acquired | ' | ' | 100.00% | 100.00% | ' | ' | ' | ' | ' | ' | ' |
Business acquisition cash paid | ' | ' | $61,500,000 | £ 37,400,000 | ' | ' | ' | ' | ' | ' | ' |
Business acquisition, issuance of common stock shares | ' | ' | 581,432 | 581,432 | ' | ' | ' | ' | ' | ' | ' |
Business acquisition, common stock value | ' | ' | 9,000,000 | 5,500,000 | ' | ' | ' | ' | ' | ' | ' |
Business acquisition, contingent cash consideration payable | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | 5,500,000 | ' |
Net Sales | 118,411,000 | 113,629,000 | ' | ' | 16,900,000 | ' | ' | ' | ' | ' | ' |
Net income (loss) | -2,077,000 | -21,000 | ' | ' | 400,000 | ' | ' | ' | ' | ' | ' |
Business combination increase in fair value of inventory | ' | ' | ' | ' | ' | ' | 900,000 | 500,000 | ' | ' | ' |
Amortization of intangible assets | ' | ' | ' | ' | ' | 900,000 | ' | ' | ' | ' | ' |
Elimination of acquisition costs | ' | ' | ' | ' | 900,000 | ' | ' | ' | ' | ' | ' |
Interest Expense and Debt Issuance Cost | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' | ' | ' |
Business acquisition cash paid | ' | ' | $61,302,000 | ' | ' | ' | ' | ' | ' | ' | $5,300,000 |
Purchase_Price_of_Acquisition_
Purchase Price of Acquisition (Detail) (Thomas Plant, USD $) | 1 Months Ended | |
In Thousands, unless otherwise specified | Jan. 15, 2014 | |
Thomas Plant | ' | |
Business Acquisition [Line Items] | ' | |
Cash | $61,302 | |
Share consideration issued | 8,382 | [1] |
Value of contingent consideration | 2,488 | [2] |
Estimated working capital adjustment | 663 | [3] |
Total purchase price | $72,835 | |
[1] | Share consideration issued is valued at the closing market price discounted to account for lack of marketability related to the lock up period as described in the share purchase agreement. | |
[2] | The value of contingent consideration represents the present value of the estimated payments related to the attainment of certain financial targets for the years 2014 through 2016. The maximum undiscounted deferred and contingent consideration to be paid on the agreement is £5.5 million ($9.0 million). | |
[3] | Estimated working capital adjustment represents the estimated future payment to be made as defined in the share purchase agreement. |
Purchase_Price_of_Acquisition_1
Purchase Price of Acquisition (Parenthetical) (Detail) (Thomas Plant) | Jan. 15, 2014 | Jan. 15, 2014 |
In Millions, unless otherwise specified | USD ($) | GBP (£) |
Business Acquisition [Line Items] | ' | ' |
Undiscounted deferred and contingent consideration, higher range | $9 | £ 5.5 |
Summary_of_Purchase_Price_Allo
Summary of Purchase Price Allocated Based on Estimated Fair Value of Assets and Liabilities (Detail) (USD $) | Jan. 15, 2014 | |
In Thousands, unless otherwise specified | ||
Schedule of Business Acquisitions, Purchase Price Allocation [Line Items] | ' | |
Accounts Receivable | $14,258 | [1] |
Inventory | 17,912 | |
Other assets | 3,650 | |
Other liabilities | -9,197 | |
Deferred income tax | -8,988 | |
Goodwill and other intangibles | 55,200 | |
Total allocated value | $72,835 | |
[1] | The fair value of accounts receivable approximated the gross contractual amounts receivable. |
Unaudited_Pro_Forma_Include_th
Unaudited Pro Forma Include the Historical Statement of Operation (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Business Acquisition, Pro Forma Information [Line Items] | ' | ' |
Net Sales | $118,411 | $113,629 |
Loss before income taxes and equity in earnings | -2,510 | -585 |
Net loss | ($2,077) | ($21) |
Basic and diluted loss per common share | ($0.16) | $0 |
Investments_Additional_Informa
Investments - Additional Information (Detail) (USD $) | 3 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' |
Equity in earnings (losses), net of taxes | ($208,000) | $246,000 | ' |
GS Internacional S/A | ' | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' |
Percentage of ownership in equity method investment | 40.00% | ' | ' |
Equity in earnings (losses), net of taxes | -213,000 | -23,000 | ' |
Grupo Vasconia S.A.B. | ' | ' | ' |
Schedule of Equity Method Investments [Line Items] | ' | ' | ' |
Percentage of ownership in equity method investment | 30.00% | ' | ' |
Exchange rate at period end - MXN to USD | 13.06 | 12.34 | ' |
Average daily exchange rate for period - MXN to USD | 13.23 | 12.7 | ' |
Increase in equity method investment | -11,000 | 1,700,000 | ' |
Due from related party | 36,000 | ' | ' |
Due to related party | 8,000 | ' | 152,000 |
Equity in earnings (losses), net of taxes | 41,000 | 300,000 | ' |
Fair value of investment | 35,200,000 | ' | 35,200,000 |
Carrying value of investment | $30,500,000 | ' | $30,500,000 |
Summarized_Statement_of_Operat
Summarized Statement of Operations Information for Vasconia in USD and MXN (Detail) | 3 Months Ended | |||||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2013 |
USD ($) | USD ($) | Grupo Vasconia S.A.B. | Grupo Vasconia S.A.B. | Grupo Vasconia S.A.B. | Grupo Vasconia S.A.B. | |
USD ($) | MXN | USD ($) | MXN | |||
Schedule of Equity Method Investments [Line Items] | ' | ' | ' | ' | ' | ' |
Net sales | $118,411 | $98,657 | $43,258 | 572,196 | $40,240 | 510,879 |
Gross profit | 44,332 | 36,312 | 7,839 | 103,697 | 7,917 | 100,519 |
Income from operations | -2,197 | -115 | 1,754 | 23,207 | 2,140 | 27,169 |
Net income | ($2,929) | ($632) | $109 | 1,438 | $1,226 | 15,568 |
Components_of_Intangible_Asset
Components of Intangible Assets (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Intangible Assets Disclosure [Line Items] | ' | ' |
Goodwill, Gross | $18,355 | $5,085 |
Goodwill, Accumulated Impairment Loss | ' | ' |
Goodwill, Net | 18,355 | 5,085 |
Indefinite-Lived Trade Names, Gross | 18,364 | 18,364 |
Indefinite-Lived Trade Names, Accumulated Impairment Loss | ' | ' |
Indefinite-Lived Trade Names, Net | 18,364 | 18,364 |
Intangible Assets, Gross (Including Goodwill) | 126,909 | 68,342 |
Finite-Lived Intangible Assets, Accumulated Amortization | -14,741 | -13,193 |
Intangible Assets, Net (Including Goodwill) | 112,168 | 55,149 |
License | ' | ' |
Schedule of Intangible Assets Disclosure [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 15,847 | 15,847 |
Finite-Lived Intangible Assets, Accumulated Amortization | -7,665 | -7,551 |
Finite-Lived Intangible Assets, Net | 8,182 | 8,296 |
Trade Names | ' | ' |
Schedule of Intangible Assets Disclosure [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 22,709 | 10,056 |
Finite-Lived Intangible Assets, Accumulated Amortization | -3,094 | -2,677 |
Finite-Lived Intangible Assets, Net | 19,615 | 7,379 |
Customer Relationships | ' | ' |
Schedule of Intangible Assets Disclosure [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 50,432 | 18,406 |
Finite-Lived Intangible Assets, Accumulated Amortization | -3,705 | -2,736 |
Finite-Lived Intangible Assets, Net | 46,727 | 15,670 |
Other Intangible Assets | ' | ' |
Schedule of Intangible Assets Disclosure [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 1,202 | 584 |
Finite-Lived Intangible Assets, Accumulated Amortization | -277 | -229 |
Finite-Lived Intangible Assets, Net | $925 | $355 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended |
In Millions, unless otherwise specified | Jan. 31, 2014 | Mar. 31, 2014 |
Revolving Credit Facility | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Revolving credit facility commitment | ' | $175 |
Line of credit facility interest rate description | ' | 'Borrowings under the Revolving Credit Facility bear interest, at the following rates (i) the Alternate Base Rate, defined as the greater of the Prime Rate, Federal Funds Rate plus 0.5% or the Adjusted LIBO Rate plus 1.0%, plus a margin of 0.75% to 1.25%, or (ii) the Eurodollar Rate, defined as the Adjusted LIBO Rate plus a margin of 1.75% to 2.25%. The respective margins are based upon availability. |
Open letters of credit | ' | 4.2 |
Outstanding borrowing under revolving credit facility | ' | 84.4 |
Availability under revolving credit facility | ' | 53.7 |
Availability under revolving credit facility, percentage of the total loan commitment | ' | 31.00% |
Revolving Credit Facility | Minimum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rates on outstanding borrowings | ' | 2.13% |
Percentage of line of credit facility unused capacity commitment fee | ' | 0.38% |
Revolving Credit Facility | Maximum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rates on outstanding borrowings | ' | 4.25% |
Revolving Credit Facility | Amended And Restated Credit Agreement | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Maturity date | 11-Jan-19 | ' |
New Term Loan facility | 50 | ' |
Credit facility terms | ' | 'The Second Amended and Restated Credit Agreement provides for customary restrictions and events of default. Restrictions include limitations on additional indebtedness, acquisitions, investments and payment of dividends, among other things. Further, the Second Amended and Restated Credit Agreement provides that at any time the Term Loans are outstanding or at anytime availability is less than $17.5 million, the Company maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 for any four consecutive fiscal quarters and provides that when the Term Loan is outstanding, the Company maintain a Senior Leverage Ratio within defined parameters of, 3.75 to 1.00 for the fiscal quarters ending in the fiscal year ending December 31, 2014. |
Minimum availability under revolving credit to maintain minimum fixed charge ratio for four consecutive months | ' | 17.5 |
Increase in senior leverage ratio | ' | 25.00% |
Revolving Credit Facility | Amended And Restated Credit Agreement | At any time the Term Loans are outstanding or at anytime availability is less than $17.5 million, the Company maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 for any four consecutive fiscal quarters. | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Fixed charge coverage ratio minimum | ' | 110.00% |
Revolving Credit Facility | Amended And Restated Credit Agreement | Each fiscal quarter end during 2014 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Senior leverage ratio | ' | 375.00% |
Revolving Credit Facility | Amended And Restated Credit Agreement | Each fiscal quarter end in 2015 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Senior leverage ratio | ' | 300.00% |
Revolving Credit Facility | Amended And Restated Credit Agreement | Each fiscal quarter end thereafter | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Senior leverage ratio | ' | 250.00% |
Revolving Credit Facility | Alternate Base Rate | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate above federal funds rate | ' | 0.50% |
Interest rate above adjusted LIBOR rate | ' | 1.00% |
Revolving Credit Facility | Alternate Base Rate | Minimum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 0.75% |
Revolving Credit Facility | Alternate Base Rate | Maximum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 1.25% |
Revolving Credit Facility | Euro Dollar Rate | Minimum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 1.75% |
Revolving Credit Facility | Euro Dollar Rate | Maximum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 2.25% |
Term Loan | Amended And Restated Credit Agreement | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Outstanding borrowing under revolving credit facility | ' | $50 |
Term Loan | Alternate Base Rate Spread | Amended And Restated Credit Agreement | Minimum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 3.00% |
Term Loan | Alternate Base Rate Spread | Amended And Restated Credit Agreement | Maximum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 3.50% |
Term Loan | Eurocurrency Rate Spread | Amended And Restated Credit Agreement | Minimum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 4.00% |
Term Loan | Eurocurrency Rate Spread | Amended And Restated Credit Agreement | Maximum | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest rate margin | ' | 4.50% |
Summary_of_Stock_Option_Detail
Summary of Stock Option (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Options | ' |
Beginning balance | 2,371,650 |
Grants | 100,000 |
Exercises | -105,213 |
Cancellations | -5,000 |
Ending balance | 2,361,437 |
Options exercisable at End of Period | 1,450,637 |
Weighted-average exercise price | ' |
Beginning balance | $12.75 |
Grants | $18.04 |
Exercises | $11.41 |
Cancellations | $15.60 |
Ending balance | $13.03 |
Options exercisable at End of Period | $13.21 |
Weighted-average remaining contractual life (years) | ' |
Options outstanding, Ending balance | '6 years 1 month 28 days |
Options exercisable, Ending balance | '5 years 1 month 2 days |
Aggregate intrinsic value | ' |
Options outstanding, end of period | $14,624,245 |
Options exercisable, end of period | $9,948,309 |
Stock_Compensation_Additional_
Stock Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' |
Total intrinsic value of stock options exercised | $668,279 | $427,100 |
Stock compensation expense | 726,000 | 671,000 |
Unrecognized compensation cost | $4,000,000 | ' |
Weighted-average recognition period | '2 years 8 months 16 days | ' |
Options available for grant in period | 548,073 | ' |
Calculations_of_Basic_and_Dilu
Calculations of Basic and Diluted Income (Loss) Per Common Share (Detail) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Earnings Per Share Disclosure [Line Items] | ' | ' |
Net loss-basic and diluted | ($2,929) | ($632) |
Weighted-average shares outstanding-basic and diluted | 13,274 | 12,761 |
Basic and diluted loss per common share | ($0.22) | ($0.05) |
Loss_Per_Common_Share_Addition
Loss Per Common Share - Additional Information (Detail) (Stock Option) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Stock Option | ' | ' |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ' | ' |
Antidilutive Securities Excluded from Computation of Diluted Income Per Common Share | 2,361,437 | 2,518,780 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Income Tax Examination [Line Items] | ' |
Gross liability for tax positions | $143,000 |
Income tax examination years description | 'The Company is no longer subject to U.S. Federal income tax examinations for the years prior to 2011. |
State Tax Authority | Minimum | ' |
Income Tax Examination [Line Items] | ' |
Income tax examination year | '2009 |
State Tax Authority | Maximum | ' |
Income Tax Examination [Line Items] | ' |
Income tax examination year | '2013 |
Business_Segments_Additional_I
Business Segments - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Segment | |
Segment Reporting Information [Line Items] | ' |
Number of reportable business segment | 2 |
Segment_Reporting_Information_
Segment Reporting Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Segment Reporting Information [Line Items] | ' | ' |
Net sales | $118,411 | $98,657 |
Depreciation and amortization | -3,613 | -2,523 |
Income (loss) from operations | -2,197 | -115 |
Wholesale | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Net sales | 113,818 | 93,118 |
Depreciation and amortization | -3,549 | -2,458 |
Retail Direct | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Net sales | 4,593 | 5,539 |
Depreciation and amortization | -64 | -65 |
Operating Segments | Wholesale | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Income (loss) from operations | 2,203 | 2,559 |
Operating Segments | Retail Direct | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Income (loss) from operations | -299 | 9 |
Unallocated corporate expenses | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Income (loss) from operations | ($4,101) | ($2,683) |
Other_Additional_Information_D
Other - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Other [Line Items] | ' | ' |
Quarterly dividend declared | $0.04 | $0.03 |
Dividend declaration date | 11-Mar-14 | ' |
Dividend payable date | 15-May-14 | ' |
Dividend declared, date of record | 1-May-14 | ' |
Dividend payable | $505,000 | ' |
Supplemental_Cash_Flow_Informa
Supplemental Cash Flow Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Supplemental disclosure of cash flow information: | ' | ' |
Cash paid for interest | $1,099 | $908 |
Cash paid for taxes | 4,340 | 4,375 |
Non-cash investing activities: | ' | ' |
Translation adjustment | ($690) | ($1,125) |
Components_of_Accumulated_Othe
Components of Accumulated Other Comprehensive Loss, Net (Detail) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | ||
Accumulated translation adjustment: | ' | ' | ||
Balance at beginning of period | ($2,944) | ($2,804) | ||
Translation gain during period | 690 | 1,125 | ||
Balance at end of period | -2,254 | -1,679 | ||
Accumulated effect of retirement benefit obligations: | ' | ' | ||
Balance at beginning of period | -745 | -1,160 | ||
Amounts reclassified from accumulated other comprehensive loss: | ' | ' | ||
Amortization of actuarial losses, net of tax of $5 and $9 for the three months ended March 31, 2014 and 2013, respectively | 7 | [1] | 13 | [1] |
Balance at end of period | -738 | -1,147 | ||
Accumulated deferred losses on cash flow hedges: | ' | ' | ||
Balance at beginning of period | -31 | -272 | ||
Derivative fair value adjustment, net of tax of $6 and $9 for the three months ended March 31, 2014 and 2013, respectively | 9 | 13 | ||
Balance at end of period | ($22) | ($259) | ||
[1] | Amounts are recorded in selling, general and administrative expense on the Condensed consolidated statements of operations. |
Components_of_Accumulated_Othe1
Components of Accumulated Other Comprehensive Loss, Net (Parenthetical) (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Amortization of actuarial losses, tax | $5 | $9 |
Derivative fair value adjustment, tax | $6 | $9 |