Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 28, 2019 | Jun. 29, 2018 | |
Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | LIFETIME BRANDS, INC | ||
Entity Central Index Key | 0000874396 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 159,784,161 | ||
Trading Symbol | LCUT | ||
Entity Common Stock, Shares Outstanding | 20,756,392 | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 7,647 | $ 7,600 |
Accounts receivable, less allowances of $7,855 at December 31, 2018 and $6,190 at December 31, 2017 | 125,292 | 108,033 |
Inventory | 173,601 | 132,436 |
Prepaid expenses and other current assets | 10,822 | 10,354 |
Income taxes receivable | 1,442 | |
TOTAL CURRENT ASSETS | 318,804 | 258,423 |
PROPERTY AND EQUIPMENT, net | 25,762 | 23,065 |
INVESTMENTS | 22,582 | 23,978 |
INTANGIBLE ASSETS, net | 338,847 | 88,479 |
DEFERRED INCOME TAXES | 733 | 5,826 |
OTHER ASSETS | 1,844 | 1,750 |
TOTAL ASSETS | 708,572 | 401,521 |
CURRENT LIABILITIES | ||
Current maturity of term loan | 1,253 | |
Short term loan | 69 | |
Accounts payable | 38,167 | 25,461 |
Accrued expenses | 45,456 | 44,121 |
Income taxes payable | 1,864 | |
TOTAL CURRENT LIABILITIES | 84,876 | 71,515 |
DEFERRED RENT & OTHER LONG-TERM LIABILITIES | 23,339 | 20,249 |
DEFERRED INCOME TAXES | 15,141 | 4,423 |
INCOME TAXES PAYABLE, LONG-TERM | 949 | 311 |
REVOLVING CREDIT FACILITY | 42,080 | 94,744 |
TERM LOAN | 262,694 | |
STOCKHOLDERS' EQUITY | ||
Preferred stock, $1.00 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: 50,000,000 at December 31, 2018 and 2017; shares issued and outstanding: 20,764,143 at December 31, 2018 and 14,902,527 at December 31, 2017 | 208 | 149 |
Paid-in capital | 258,637 | 178,909 |
Retained earnings | 55,264 | 60,546 |
Accumulated other comprehensive loss | (34,616) | (29,325) |
TOTAL STOCKHOLDERS' EQUITY | 279,493 | 210,279 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 708,572 | $ 401,521 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Accounts receivable, allowances | $ 7,855 | $ 6,190 |
Preferred stock, par value | $ 1 | $ 1 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 20,764,143 | 14,902,527 |
Common stock, shares outstanding | 20,764,143 | 14,902,527 |
Preferred stock Series A | ||
Preferred stock, shares authorized | 100 | 100 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Preferred stock Series B | ||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net sales | $ 704,542 | $ 579,476 | $ 592,619 |
Cost of sales | 448,785 | 364,319 | 375,719 |
Gross margin | 255,757 | 215,157 | 216,900 |
Distribution expenses | 69,716 | 58,050 | 57,006 |
Selling, general and administrative expenses | 162,933 | 140,903 | 130,397 |
Impairment of goodwill | 2,205 | ||
Restructuring expenses | 2,324 | 1,024 | 2,420 |
Income from operations | 18,579 | 15,180 | 27,077 |
Interest expense | (18,004) | (4,291) | (4,803) |
Loss on early retirement of debt | (66) | (110) | (272) |
Income before income taxes and equity in earnings | 509 | 10,779 | 22,002 |
Income tax provision | (2,889) | (9,032) | (7,030) |
Equity in earnings, net of taxes | 660 | 407 | 748 |
NET (LOSS) INCOME | $ (1,720) | $ 2,154 | $ 15,720 |
BASIC (LOSS) INCOME PER COMMON SHARE | $ (0.09) | $ 0.15 | $ 1.11 |
DILUTED (LOSS) INCOME PER COMMON SHARE | $ (0.09) | $ 0.14 | $ 1.08 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net (loss) income | $ (1,720) | $ 2,154 | $ 15,720 |
Other comprehensive (loss) income , net of tax: | |||
Translation adjustment | (5,906) | 7,823 | (23,061) |
Less: Amount reclassified | 378 | ||
Total translation (loss) gain | (5,906) | 7,823 | (22,683) |
Deferred gains (losses) on cash flow hedges : | |||
Settlement of cash flow hedge | (14) | ||
Fair value adjustment, net of tax of $38 in 2018, $0 in 2017 and $11 in 2016 | 161 | 17 | 17 |
Total deferred gains on cash flow hedges | 147 | 17 | 17 |
Effect of retirement benefit obligations: | |||
Net income (loss) arising from retirement benefit obligations, net of tax of $93 in 2018, ($132) in 2017 and ($135) in 2016 | 373 | (228) | (202) |
Less: amortization of loss included in net (loss) income, net of tax of $23 in 2018, $42 in 2017 and $36 in 2016 | 95 | 62 | 54 |
Total effects of retirement benefit obligations | 468 | (166) | (148) |
Other comprehensive (loss) income, net of tax | (5,291) | 7,674 | (22,814) |
Comprehensive (loss) income | $ (7,011) | $ 9,828 | $ (7,094) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Fair value adjustment, tax | $ 38 | $ 0 | $ 11 |
Net (loss) income arising from retirement benefit obligations, tax | 93 | 132 | 135 |
Amortization of loss included in net income, tax | $ 23 | $ 42 | $ 36 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Director | Employee | Common Stock | Common StockDirector | Common StockEmployee | Paid-in capital | Paid-in capitalDirector | Paid-in capitalEmployee | Retained earnings | Retained earningsDirector | Retained earningsEmployee | Accumulated other comprehensive loss | Accumulated other comprehensive lossDirector | Accumulated other comprehensive lossEmployee | |
Beginning Balance (in shares) at Dec. 31, 2015 | 14,030,000 | |||||||||||||||
Balance at beginning of year at Dec. 31, 2015 | $ 199,468 | $ 140 | $ 165,780 | $ 47,733 | $ (14,185) | |||||||||||
Comprehensive (loss) income: | ||||||||||||||||
Net income (loss) | 15,720 | 15,720 | ||||||||||||||
Translation adjustment | (22,683) | (22,683) | ||||||||||||||
Derivative fair value adjustment | 17 | 17 | ||||||||||||||
Effect of retirement benefit obligations | (148) | (148) | ||||||||||||||
Comprehensive (loss) income | (7,094) | |||||||||||||||
Restricted shares issued to directors (in shares) | 27,000 | |||||||||||||||
Restricted shares issued to directors | ||||||||||||||||
Shares issued to employees/directors (in shares) | 234,000 | |||||||||||||||
Shares issued to employees/directors | $ 2,127 | $ 3 | $ 2,124 | |||||||||||||
Stock compensation expense | 2,911 | 2,911 | ||||||||||||||
Excess tax benefit from stock options, net | $ 435 | 435 | ||||||||||||||
Exercise of stock options (in shares) | 272,325 | 265,000 | ||||||||||||||
Exercise of stock options | $ 2,353 | $ 3 | 2,350 | |||||||||||||
Dividends | [1] | (2,472) | (2,472) | |||||||||||||
Ending Balance (in shares) at Dec. 31, 2016 | 14,556,000 | |||||||||||||||
Balance at end of year at Dec. 31, 2016 | 197,728 | $ 146 | 173,600 | 60,981 | (36,999) | |||||||||||
Comprehensive (loss) income: | ||||||||||||||||
Net income (loss) | 2,154 | 2,154 | ||||||||||||||
Translation adjustment | 7,823 | 7,823 | ||||||||||||||
Derivative fair value adjustment | 17 | 17 | ||||||||||||||
Effect of retirement benefit obligations | (166) | (166) | ||||||||||||||
Comprehensive (loss) income | 9,828 | |||||||||||||||
Restricted shares issued to directors (in shares) | 30,000 | |||||||||||||||
Restricted shares issued to directors | ||||||||||||||||
Shares issued to employees/directors (in shares) | 97,000 | |||||||||||||||
Shares issued to employees/directors | 2 | $ 1 | 1 | |||||||||||||
Stock compensation expense | $ 3,390 | 3,390 | ||||||||||||||
Exercise of stock options (in shares) | 300,000 | 254,000 | ||||||||||||||
Exercise of stock options | $ 2,537 | $ 2 | 2,535 | |||||||||||||
Shares effectively repurchased for required employee withholding taxes (in shares) | (34,000) | |||||||||||||||
Shares effectively repurchased for required employee withholding taxes | (694) | (694) | ||||||||||||||
Adoption of ASU 2016-09 | 31 | 77 | (46) | |||||||||||||
Dividends | [1] | (2,543) | (2,543) | |||||||||||||
Ending Balance (in shares) at Dec. 31, 2017 | 14,903,000 | |||||||||||||||
Balance at end of year at Dec. 31, 2017 | 210,279 | $ 149 | 178,909 | 60,546 | (29,325) | |||||||||||
Comprehensive (loss) income: | ||||||||||||||||
Net income (loss) | (1,720) | (1,720) | ||||||||||||||
Translation adjustment | (5,906) | (5,906) | ||||||||||||||
Derivative fair value adjustment | 147 | 147 | ||||||||||||||
Effect of retirement benefit obligations | 468 | 468 | ||||||||||||||
Comprehensive (loss) income | $ (7,011) | |||||||||||||||
Restricted shares issued to directors (in shares) | 46,000 | |||||||||||||||
Restricted shares issued to directors | ||||||||||||||||
Shares issued to employees/directors (in shares) | 211,000 | |||||||||||||||
Shares issued to employees/directors | $ 2 | $ (2) | ||||||||||||||
Issuance of 5,593,116 shares of common stock for acquisition of Filament, net of equity issuance costs (in shares) | 5,593,116 | 5,593,000 | ||||||||||||||
Issuance of 5,593,116 shares of common stock for acquisition of Filament, net of equity issuance costs | $ 75,970 | $ 56 | 75,914 | |||||||||||||
Stock compensation expense | $ 4,091 | 4,091 | ||||||||||||||
Exercise of stock options (in shares) | 58,000 | 58,000 | ||||||||||||||
Exercise of stock options | $ 286 | $ 1 | 285 | |||||||||||||
Shares effectively repurchased for required employee withholding taxes (in shares) | (47,000) | |||||||||||||||
Shares effectively repurchased for required employee withholding taxes | (560) | (560) | ||||||||||||||
Dividends | [1] | (3,562) | (3,562) | |||||||||||||
Ending Balance (in shares) at Dec. 31, 2018 | 20,764,000 | |||||||||||||||
Balance at end of year at Dec. 31, 2018 | $ 279,493 | $ 208 | $ 258,637 | $ 55,264 | $ (34,616) | |||||||||||
[1] | Cash dividend declared per share of common stock, were $0.17, $0.17 and $0.17 in 2016, 2017 and 2018, respectively. |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Stock Issued During Period, Shares, Acquisitions | 5,593,116 | ||
Cash dividend declared per share | $ 0.17 | $ 0.17 | $ 0.17 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
OPERATING ACTIVITIES | |||
Net (loss) income | $ (1,720) | $ 2,154 | $ 15,720 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||
Depreciation and amortization | 23,329 | 14,189 | 14,148 |
Impairment of goodwill | 2,205 | ||
Amortization of financing costs | 1,543 | 519 | 650 |
Deferred rent | 57 | (642) | (243) |
Deferred income taxes | 2,086 | 1,030 | (1,951) |
Net loss on disposal of fixed assets | 84 | ||
Stock compensation expense | 4,135 | 3,390 | 2,942 |
Undistributed equity (earnings) losses | (545) | (379) | (544) |
Loss on early retirement of debt | 66 | 110 | 272 |
Contingent consideration fair value adjustment | (1,774) | ||
Changes in operating assets and liabilities (excluding the effects of business acquisitions) | |||
Accounts receivable | 8,020 | 1,481 | (17,977) |
Inventory | (13,819) | 10,818 | 4,491 |
Prepaid expenses, other current assets and other assets | 540 | (951) | (1,199) |
Accounts payable, accrued expenses and other liabilities | (3,153) | (9,778) | 12,255 |
Income taxes receivable | (1,442) | 132 | |
Income taxes payable | (353) | (4,935) | 969 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 19,175 | 17,006 | 29,749 |
INVESTING ACTIVITIES | |||
Purchases of property and equipment | (7,902) | (6,311) | (3,380) |
Filament acquisition, net of cash acquired | (216,527) | ||
Acquisitions, net of cash acquired | (9,072) | (21,699) | |
Equity investments | 567 | ||
Net proceeds from sale of property | 249 | 15 | 64 |
NET CASH USED IN INVESTING ACTIVITIES | (224,180) | (15,368) | (24,448) |
FINANCING ACTIVITIES | |||
Proceeds from revolving credit facility | 268,912 | 237,658 | 268,242 |
Repayments of revolving credit facility | (320,767) | (229,696) | (246,756) |
Proceeds from Term Loan | 275,000 | ||
Repayments of Term Loan | (2,063) | ||
Proceeds from short term loan | 216 | 187 | 118 |
Payments from short term loan | (278) | (239) | (248) |
Payment of financing costs | (11,171) | (31) | (30) |
Payment of equity issuance costs | (936) | ||
Cash dividends paid | (3,273) | (2,475) | (2,413) |
Payment of capital lease obligations | (77) | (94) | (68) |
Proceeds from the exercise of stock options | 286 | 2,537 | 2,353 |
Payments of tax withholding for stock based compensation | (561) | (644) | (86) |
Excess tax benefit from stock options | 223 | ||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 205,288 | (2,297) | (4,165) |
Effect of foreign exchange on cash | (236) | 376 | (384) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 47 | (283) | 752 |
Cash and cash equivalents at beginning of year | 7,600 | 7,883 | 7,131 |
CASH AND CASH EQUIVALENTS AT END OF YEAR | 7,647 | 7,600 | 7,883 |
Line of Credit [Member] | |||
FINANCING ACTIVITIES | |||
Repayments of Term Loan | $ (9,500) | $ (25,500) |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2018 | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE A — SIGNIFICANT 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 sells its products directly to retailers (including through their Internet websites) and, to a lesser extent, to distributors. The Company also sells a limited selection of its products directly to consumers through its own Internet websites. Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for financial information and with the instructions to Form 10-K. The accompanying consolidated financial statements include estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with U.S. GAAP. The most significant of these estimates and assumptions relate to revenue recognition, allowances for doubtful accounts, reserves for sales returns and allowances and customer chargebacks, inventory mark-down provisions, impairment of tangible and intangible assets, stock based compensation expense, estimates for unpaid healthcare claims, derivative valuations, accruals related to the Company’s tax positions and tax valuation allowances. Although these and other estimates and assumptions are based on the best available information, actual results could be materially different from these estimates. Principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Foreign currency Foreign currency denominated assets and liabilities are translated into U.S. dollars at exchange rates prevailing at the balance sheet dates. Revenues, costs and expenses are translated into U.S. dollars at average exchange rates for the relevant period. Income and losses resulting from translation are recorded as a component of accumulated other comprehensive income (loss). Gains and losses from foreign currency transactions, including the unrealized gain or loss on the fair value of foreign exchange contracts not designated as hedges and the realized gain or loss on all foreign exchange contracts, whether or not designated as hedges, are recognized in selling, general and administrative expenses in the consolidated statements of operations. Foreign currency gain/loss included within selling, general and administrative expenses was a $0.5 million loss in 2018, a $3.0 million loss in 2017 and a $4.2 million gain in 2016. Revenue recognition The Company sells products wholesale, to retailers and distributors, and retail, directly to the consumer. Wholesale sales and retail sales are recognized at the point in time the customer obtains control of the products, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products. The Company offers various sales incentives and promotional programs to its customers 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 returns are reflected as reductions of revenue at the time of sale. See Note B – Revenue for additional information. Cost of sales Cost of sales consist primarily of costs associated with the production and procurement of product, inbound freight costs, purchasing costs, royalties and other product procurement related charges. Distribution expenses Distribution expenses consist primarily of warehousing expenses and freight-out expenses. Freight-out expenses were $14.5 million, $11.5 million and $11.0 million for the years ended December 31, 2018, 2017 and 2016, respectively. Handling costs of products sold are included in cost of sales. Advertising expenses Advertising expenses are expensed as incurred and are included in selling, general and administrative expenses. Advertising expenses were $4.4 million, $3.4 million and $3.7 million for the years ended December 31, 2018, 2017 and 2016, respectively. Accounts receivable The Company periodically reviews the collectability of its accounts receivable and establishes allowances for estimated losses that could result from the inability of its customers to make required payments. A considerable amount of judgment is required to assess the ultimate realization of these receivables including assessing the initial and on-going creditworthiness of the Company’s customers. The Company also maintains an allowance for anticipated customer deductions. The allowances for deductions are primarily based on contracts with customers. However, in certain cases the Company does not have a formal contract and, therefore, customer deductions are non-contractual. To evaluate the reasonableness of non-contractual customer deductions, the Company analyzes currently available information and historical trends of deductions. The sale of accounts receivable, under the Company’s Receivable Purchase Agreement with HSBC, are reflected as a reduction of accounts receivable in the Company’s consolidated balance sheet at the time of sale and any related expense is included in selling, general and administrative expenses in the Company’s consolidated statements of operations. 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 using the lower of cost (first-in, first-out basis) or net realizable value. 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. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. Property and equipment Property and equipment is stated at cost. Property and equipment, other than leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the assets. Building and improvements are depreciated over 30 years and machinery, furniture and equipment over periods ranging from 3 to 10 years. Leasehold improvements are amortized over the term of the lease or the estimated useful lives of the improvements, whichever is shorter. Advances paid towards the acquisition of property and equipment and the cost of property and equipment not ready for use before the end of the period are classified as construction in progress. Cash equivalents The Company considers all highly liquid instruments with a maturity of three months or less when purchased to be cash equivalents. Concentration of credit risk The Company’s cash and cash equivalents are potentially subject to concentration of credit risk. The Company maintains cash with several financial institutions that, in some cases, is in excess of Federal Deposit Insurance Corporation insurance limits. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of entities comprising the Company’s customer base. During the years ended December 31, 2018, 2017 and 2016, Wal-Mart Stores, Inc., including Sam’s Club and, in the United Kingdom, Asda Superstore, (“Walmart”), accounted for 14%, 15% and 16% of net sales, respectively. During the year ended December 31, 2016, Costco Wholesale Corporation, (“Costco”), accounted for 10% of net sales. Sales to Walmart are included in the Company’s U.S. and International segments. Sales to Costco are primarily included in the U.S. segment. No other customers accounted for 10% or more of the Company’s sales during these periods. Fair value measurements Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures , provides enhanced guidance for using fair value to measure assets and liabilities and establishes a common definition of fair value, provides a framework for measuring fair value under U.S. generally accepted accounting principles and expands disclosure requirements about fair value measurements. Fair value measurements included in the Company’s consolidated financial statements relate to the Company’s annual goodwill and other intangible asset impairment tests and derivatives, described in Notes F- Goodwill and Intangible Assets and H- Derivatives, respectively. Fair value of financial instruments The Company determined that 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 ABL Agreement and 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 815, Derivatives and Hedging , (“ASC 815”). ASC 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 until the hedged item is recognized in earnings. The change in the fair value of hedges are included in accumulated other comprehensive income (loss) and is subsequently recognized in the Company’s consolidated statements of operations to mirror the location of the hedged items impacting earnings. For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in operations. Goodwill, intangible assets and long-lived assets Goodwill and intangible assets deemed to have indefinite lives are not amortized but, instead, are subject to an annual impairment assessment. Additionally, if events or conditions were to indicate the carrying value of a reporting unit may not be recoverable, the Company would evaluate goodwill and other intangible assets for impairment at that time. As it relates to the goodwill assessment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment testing described in ASU Topic 350, Intangibles – Goodwill and Other . If, after assessing qualitative factors, the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative test is unnecessary and the Company’s goodwill is considered to be unimpaired. However, if based on the Company’s qualitative assessment it concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects to bypass the qualitative assessment, the Company will proceed with performing the quantitative impairment test. In January 2017, the FASB issued revised guidance that simplifies the test for goodwill impairment, effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company elected to early adopt the guidance in the third quarter of 2018. Under the revised guidance, if a reporting unit’s carrying value exceeds its fair value, an impairment charge will be recorded to reduce the reporting unit to fair value. Prior to the revised guidance, the amount of the impairment was the difference between the carrying value of the goodwill and the “implied” fair value, which was calculated as if the reporting unit had just been acquired and accounted for as a business combination. The Company also evaluates qualitative factors to determine whether or not its indefinite lived intangibles have been impaired and then performs quantitative tests if required. These tests can include the relief from royalty model or other valuation models. Long-lived assets, including intangible assets deemed to have finite lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment indicators include, among other conditions, cash flow deficits, historic or anticipated declines in revenue or operating profit or material adverse changes in the business climate that indicate that the carrying amount of an asset may be impaired. When impairment indicators are present, the recoverability of the asset is measured by comparing the carrying value of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset is not recoverable, the impairment to be recognized is measured by the amount by which the carrying amount of each long-lived asset exceeds the fair value of the asset. Income taxes The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company accounts for foreign income taxes based upon anticipated reinvestment of profits into respective foreign tax jurisdictions. The Company applies the authoritative guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the Company’s financial statements . In accordance with this guidance, tax positions must meet a more-likely-than-not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position. A valuation allowance is required to be established or maintained when it is “more likely than not” that all or a portion of deferred tax assets will not be realized. Share-based compensation The Company accounts for its share-based compensation arrangements in accordance with ASC Topic 718, Stock Compensation , which requires the measurement of compensation expense for all share-based compensation granted to employees and non-employee directors at fair value on the date of grant and recognition of compensation expense over the related service period. Forfeitures are accounted for as they occur. The Company uses the Black-Scholes option valuation model to estimate the fair value of its stock options. The Black-Scholes option valuation model requires the input of highly subjective assumptions including the expected stock price volatility of the Company’s common stock and the risk-free interest rate. Changes in these subjective input assumptions can materially affect the fair value estimate of the Company’s stock options on the date of the option grant. Performance share awards are initially valued at the Company’s closing stock price on the date of grant. Each performance award represents the right to receive up to 150% The Company bases the estimated fair value of restricted stock awards on the date of grant. The estimated fair value is determined based on the closing price of the Company’s common stock on the date of grant multiplied by the number of shares awarded. Compensation expense is recognized on a straight-line basis over the vesting period. Employee healthcare The Company self-insures certain portions of its health insurance plan. The Company maintains an accrual for estimated unpaid claims and claims incurred but not yet reported (“IBNR”). Although management believes that it uses the best information available to estimate IBNR claims, actual claims may vary significantly from estimated claims. Restructuring expenses Costs associated with restructuring activities are recorded at fair value when a liability has been incurred. A liability has been incurred at the point of closure for any remaining operating lease obligations and at the communication date for severance. In connection with the Company’s March 2018 acquisition of Filament, the Company commenced a restructuring plan to integrate the operations of Filament with the Company’s operations and realize the savings expected from the synergies of the acquisition. During the year ended December 31, 2018 the Company incurred $2.1 restructuring charges, primarily related to severance, of which $1.4 During the years ended December 31, 2018 and 2017, the Company incurred $0.2 million and $1.0 $1.5 During the year ended December 31, 2016 the Company recorded $2.4 million of restructuring expense related to its review of the U.S. segment, which included the realignment of product categories and implementation of cost reduction initiatives. Commitments and Contingencies The Company is subject to various claims and contingencies related to lawsuits, certain taxes and environmental matters, as well as commitments under contractual and other commercial obligations. The Company recognizes liabilities for contingencies and commitments when a loss is probable and estimable. Adopted Accounting Pronouncements Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2017-01, Clarifying the Definition of a Business . This standard assists with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This standard will be applied prospectively to acquisitions and has not had an impact on the Company’s consolidated financial statements. Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers Effective January 1, 2018, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The guidance also makes certain improvements to simplify the application of hedge accounting guidance and ease the administrative burden of hedge documentation requirements and assessing hedge effectiveness. The Company applied the new guidance to existing cash flow hedge relationships using a modified retrospective approach. No adjustment was recorded to opening retained earnings on the date of adoption, as there was no ineffectiveness previously recorded in retained earnings that would have been included in other comprehensive income if the new guidance had been applied since hedge inception. The adoption of this ASU did not have a material impact on the Company’s financial condition, results of operations or cash flows. Effective September 30, 2018, the Company adopted ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment Accounting pronouncements to be adopted in future periods Updates not listed below were assessed and either determined to not be applicable or are expected to have a minimal effect on the Company’s financial position, results of operations, and disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement- Reporting Comprehensive Income: Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which reduces the diversity in practice on how certain transactions are classified in the statement of cash flows. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires a lessee, in most leases, to initially recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those years. The guidance requires adoption using a modified retrospective transition approach with either 1) periods prior to the adoption date being recast or 2) a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. The Company adopted this standard on January 1, 2019 using the cumulative-effect adjustment method and elected certain practical expedients allowed under the standard. The Company’s project team assessed the effect of the adoption of this standard on its accounting policies, business processes, internal controls over financial reporting and related disclosures. Upon adoption, the Company estimates assets and liabilities will increase by approximately $91.0 million and $104.5 million, respectively. Changes in the Company’s lease population or changes in incremental borrowing rates may alter this estimate. The Company does not expect to recognize a material cumulative-effect adjustment to retained earnings upon adoption. The Company will provide expanded disclosures as a result of the guidance upon adoption. |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 2018 | |
REVENUE | NOTE B —REVENUE The Company sells products wholesale, to retailers and distributors, and sells products retail, directly to consumers. Wholesale sales and retail sales are recognized at the point in time the customer obtains control of the products in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products. To indicate the transfer of control, the Company must have a present right to payment, legal title must have passed to the customer, the customer must have the significant risks and rewards of ownership, and where acceptance is not a formality, the customer must have accepted the product or service. The Company’s principal terms of sale are FOB Shipping Point, or equivalent, and, as such, the Company primarily transfers control and records revenue for product sales upon shipment. Sales arrangements with delivery terms that are not FOB Shipping Point are not recognized upon shipment and the transfer of control for revenue recognition is evaluated based on the associated shipping terms and customer obligations. Shipping and handling fees that are billed to customers in sales transactions are included in net sales and amounted to $3.5 million, $2.7 million and $2.6 million for the years ended December 31, 2018, 2017 and 2016, 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 wholesale 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 represent forms of variable consideration, and an estimate of sales returns are reflected as reductions in net sales in the Company’s consolidated statements of operations. These estimates are based on historical experience and other known factors or as the most likely amount in a range of possible outcomes. On a quarterly basis, variable consideration is assessed on a portfolio approach in estimating the extent to which the components of variable consideration are constrained. Payment terms vary by customer, but generally range from 30 to 90 days or at the point of sale for the Company’s retail direct sales. The Company incurs certain direct incremental costs to obtain contracts with customers, such as sales-related commissions, where the recognition period for the related revenue is less than one year. These costs are expensed as incurred and recorded within selling, general and administrative expenses in the consolidated statement of operations. Incidental items that are immaterial in the context of the contract are expensed as incurred. The following tables present the Company’s net sales disaggregated by segment, product category and geographic region for the years ended December 31, 2018, 2017 and 2016 (in thousands). Year Ended December 31, 2018 2017 2016 (in thousands) U.S. segment Kitchenware $ 331,603 $ 276,745 $ 287,100 Tableware 169,709 152,846 155,961 Home Solutions 110,661 52,128 48,488 Total U.S. segment 611,973 481,719 491,549 International segment Kitchenware 58,164 59,686 59,742 Tableware 34,405 38,071 41,328 Total International segment 92,569 97,757 101,070 Total net sales $ 704,542 $ 579,476 $ 592,619 Year ended December 31, 2018 2017 2016 (in thousands) United States $ 575,158 $ 460,788 $ 472,962 United Kingdom 65,852 74,834 74,991 Rest of World 63,532 43,854 44,666 Total net sales $ 704,542 $ 579,476 $ 592,619 |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2018 | |
ACQUISITIONS | NOTE C —ACQUISITIONS Filament On December 22, 2017 March 2, 2018 The purchase price, as adjusted, has been determined to be as follows (in thousands): Cash $ 217,511 Share consideration 76,905 Total purchase price $ 294,416 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): Accounts receivable $ 26,224 Inventory 29,444 Other assets 5,620 Other liabilities (22,449 ) Deferred income tax (13,877 ) Goodwill and other intangibles 269,454 Total allocated value $ 294,416 The acquisition is being accounted for as a business combination using the acquisition method of accounting in accordance with FASB ASC Topic 805, Business Combinations The year ended December 31, 2018 includes the operations of Filament for the period from March 2, 2018, the date of the acquisition of Filament, to December 31, 2018. The consolidated statement of operations for the year ended December 31, 2018, includes $ 128.8 Included in Selling, general and administrative expenses for the year ended December 31, 2018 is a $1.8 million credit to reflect the change in fair value of a contingent consideration obligation acquired by the Company in connection with its acquisition of Filament. Unaudited Pro forma Results 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 Filament 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 consolidated operating results of the combined company. Year ended December 31, 2018 2017 (In thousands, except per share data) Net sales $ 730,353 $ 747,549 Income before income taxes and equity in earnings 2,439 14,151 Net (loss) income (267 ) 5,794 Diluted (loss) income per common share $ (0.01 ) $ 0.28 Fitz and Floyd On August 31, 2017, the Company acquired the Fitz and Floyd business, including the trade names and related working capital, from Fitz and Floyd Enterprises, LLC (“Fitz”) for cash in the amount of $9.1 million. The purchase price was funded by borrowings under the Company’s revolving credit facility. The assets and operating results of the Fitz and Floyd business are reflected in the Company’s consolidated financial statements in accordance with ASC Topic 805 commencing from the date of the acquisition of Fitz. The consolidated statement of operations for the year ended December 31, 2017 includes $7.7 million of net sales attributable to the Fitz and Floyd brands. The purchase price was allocated based on the Company’s estimate of the fair values of the assets acquired and liabilities assumed, as follows (in thousands): Accounts Receivable $ 3,115 Inventory 5,424 Other assets 458 Other liabilities (2,056 ) Goodwill and other intangibles 2,131 Total allocated value $ 9,072 On the basis of estimated fair values, the excess of the purchase price over the net assets acquired of $2.1 million has been allocated as follows: $1.7 million for customer relationships and trade names and $0.4 million for goodwill. The goodwill recognized results from such factors as an assembled workforce and the value of other synergies expected from combining operations with the Company. All the goodwill and other intangibles are included in the U.S. segment. Customer relationships and trade names are amortized on a straight-line basis over their estimated useful lives (see Note F- Goodwill and Intangible Assets). Focus In September 2016, the Company acquired the Amco Houseworks ® ® . The consolidated statement of operations for the year ended December 31, 2016 includes $3.6 million of net sales attributable to the Focus brands. The purchase price was allocated based on the Company’s estimate of the fair values of the assets acquired, including inventory ($3.5 million) and customer relationships and trade names ($5.3 million). Customer relationships and trade names are amortized on a straight-line basis over their estimated useful lives of 15 years. Copco In October 2016, the Company acquired the Copco ® ® ® $3.9 million of net sales attributable to the Copco ® |
SALE OF ACCOUNTS RECEIVABLE
SALE OF ACCOUNTS RECEIVABLE | 12 Months Ended |
Dec. 31, 2018 | |
SALE OF ACCOUNTS RECEIVABLE | NOTE D — SALE OF ACCOUNTS RECEIVABLE In order to improve its liquidity during seasonally high working capital periods, in 2016 the Company entered into an uncommitted Receivables Purchase Agreement with HSBC Bank USA, National Association (“ ”), as Purchaser (the “Receivables Purchase Agreement”). Under the Receivables Purchase Agreement, the Company may offer to sell certain eligible accounts receivable (the “Receivables”) to , which may accept such offer, and purchase the offered Receivables. Under the Receivables Purchase Agreement, following each purchase of Receivables, the outstanding aggregate purchased Receivables shall not exceed $25.0 million. will assume credit risk of the Receivables purchased; provided, however, that the Company will continue to be responsible for all non-credit risk matters. The Company will service the Receivables, and as such servicer, collect and otherwise enforce the Receivables on behalf of . The term of the agreement is for 364 automatically be extended for annual successive terms unless terminated 18.0 16.4 from customers. A charge of $453,000 and $328,000 related to the sale of the Receivables is included in selling, general and administrative expenses in the consolidated statement of operations for the years ended December 31, 2018 and 2017, respectively. |
EQUITY INVESTMENTS
EQUITY INVESTMENTS | 12 Months Ended |
Dec. 31, 2018 | |
EQUITY INVESTMENTS | NOTE E — EQUITY INVESTMENTS The Company owns approximately 30% of the outstanding capital stock of 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. 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 years ended December 31, 2018, 2017 and 2016 in the accompanying 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 19.64 and MXN 19.68 at December 31, 2018 and 2017, respectively. The Company’s proportionate share of Vasconia’s net income has been translated from MXN to USD using the average exchange rates of MXN 18.71 to 19.81, MXN 17.81 to 20.30 and MXN 18.02 to 19.85, increase of the investment of $1.0 million during the year ended December 31, 2017. These translation effects are recorded in accumulated other comprehensive loss. The Company received cash dividends of $115,000, $28,000 and $205,000, from Vasconia during the years ended December 31, 2018, 2017 and 2016, respectively. Included in prepaid expenses and other current assets at December 31, 2018 and 2017 was $95,000 and $64,000, respectively, due from Vasconia. Summarized income statement information for the years ended December 31, 2018, 2017 and 2016, as well as summarized balance sheet information as of December 31, 2018 and 2017, for Vasconia, calculated in accordance with U.S. GAAP, in USD and MXN is as follows: Year Ended December 31, 2018 2017 2016 (in thousands) USD MXN USD MXN USD MXN Income Statement Net sales $ 179,547 $ 3,456,852 $ 167,283 $ 3,157,671 $ 149,533 $ 2,795,009 Gross profit 36,891 711,941 34,626 655,186 27,205 510,617 Income from operations 11,402 222,115 10,475 199,170 5,611 105,334 Net income 2,887 57,590 1,164 23,983 3,491 68,230 December 31, 2018 2017 (in thousands) USD MXN USD MXN Balance Sheet Current assets $ 96,135 $ 1,888,602 $ 91,157 $ 1,793,832 Non-current assets 86,279 1,694,969 87,900 1,729,745 Current liabilities 64,831 1,273,619 50,766 998,993 Non-current liabilities 32,261 633,772 39,147 770,352 The Company recorded equity in earnings of Vasconia, net of taxes, of $0.9 million, $0.4 million and $0.6 million for the years ended December 31, 2018, 2017 and 2016, $0.2 million and ($0.5) million, respectively, due to the requirement to record tax benefits for foreign currency translation losses through other comprehensive income (loss), with a corresponding adjustment to deferred tax liabilities. As of December 31, 2018, the fair value (based upon the quoted stock price) of the Company’s investment in Vasconia was $31.9 million. The carrying value of the Company’s investment in Vasconia was $22.6 million. In February 2012, the Company entered into a joint venture, Grand Venture Holdings Limited (“Grand Venture”), with Manweal Development Limited (“Manweal”), a Chinese corporation, to distribute Mikasa ® During the year ended December 31, 2016, the Company sold its 40% equity interest in GS Internacional S/A (“GSI”), a wholesale distributor of branded housewares products in Brazil. The Company initially acquired GSI in December 2011 and accounted for this investment using the equity method of accounting; however, impairment losses in 2014 reduced the investment balance to zero. Upon the sale of its equity interest in GSI the Company recognized a net gain of $189,000. This gain is included within equity in earnings (losses), net of tax, and represents the net consideration received of 2.3 (approximately $567,000) reduced by currency translation losses of $378,000 recognized upon the sale of the equity interest in GSI. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
GOODWILL AND INTANGIBLE ASSETS | NOTE F — GOODWILL AND INTANGIBLE ASSETS The Company’s intangible assets, all of which are included in the U.S. and International segments, consist of the following (in thousands): Year Ended December 31, 2018 2017 Gross Impairment Accumulated Amortization Net Gross Accumulated Amortization Net Goodwill $ 93,895 $ (2,205 ) $ — $ 91,690 $ 15,772 $ — $ 15,772 Indefinite -lived intangible assets: Trade names 58,216 — — 58,216 7,616 — 7,616 Finite -lived intangible assets: Licenses 15,847 (9,825 ) 6,022 15,847 (9,375 ) 6,472 Trade names 43,689 (13,965 ) 29,724 33,368 (11,109 ) 22,259 Customer relationships 175,482 (27,538 ) 147,944 52,961 (16,966 ) 35,995 Other 6,510 (1,259 ) 5,251 1,165 (800 ) 365 Total $ 393,639 $ (2,205 ) $ (52,587 ) $ 338,847 $ 126,729 $ (38,250 ) $ 88,479 A summary of the activities related to the Company’s intangible assets for the years ended December 31, 2018, 2017 and 2016 consists of the following (in thousands): Intangible Assets Goodwill Total Intangible Assets and Goodwill Goodwill and Intangible Assets, December 31, 2015 $ 78,492 $ 18,101 $ 96,593 Acquisition of trade names 5,159 — 5,159 Acquisition of customer relationships 8,878 — 8,878 Acquisition of other intangible assets 50 — 50 Foreign currency translation adjustment (11,400 ) (3,900 ) (15,300 ) Amortization (6,161 ) — (6,161 ) Goodwill and Intangible Assets, December 31, 2016 75,018 14,201 89,219 Acquisition of goodwill — 434 434 Acquisition of trade names 1,134 — 1,134 Acquisition of customer relationships 563 — 563 Foreign currency translation adjustment 2,823 1,137 3,960 Amortization (6,831 ) — (6,831 ) Goodwill and Intangible Assets, December 31, 2017 72,707 15,772 88,479 Acquisition of goodwill — 78,795 78,795 Acquisition of trade names 61,500 61,500 Acquisition of customer relationships 124,430 124,430 Acquisition of other intangible assets 5,367 — 5,367 Foreign currency translation adjustment (1,524 ) (672 ) (2,196 ) Amortization (15,323 ) — (15,323 ) Impairment of goodwill — (2,205 ) (2,205 ) Goodwill and Intangible Assets, December 31, 2018 $ 247,157 $ 91,690 $ 338,847 The weighted-average amortization periods for the Company’s finite-lived intangible assets as of December 31, 2018 are as follows: Years Trade names 15 Licenses 33 Customer relationships 14 Other 10 Estimated amortization expense for each of the five succeeding fiscal years is as follows (in thousands): Year ending December 31, 2019 $ 16,841 2020 16,827 2021 16,349 2022 16,349 2023 16,309 Amortization expense for the years ended December 31, 2018, 2017 and 2016 was $15.3 million, $6.8 million and $6.2 million, respectively. Annual indefinite-lived trade name impairment test In 2018, the Company elected to first perform a qualitative assessment to determine if it was more likely than not that the fair values of the Company’s indefinite-lived trade names were less than the carrying values. The Company considered events and circumstances that could affect the significant inputs used to determine the fair values of the indefinite-lived trade names. Based on the qualitative assessment, the Company determined it was not more likely than not that the fair values of the Company’s indefinite-lived trade names were less than the carrying values as of October 1, 2018. Goodwill impairment test During the third quarter of 2018, the Company performed an interim impairment assessment of its European tableware business due to a decline in operating performance and reduced expectations for future cash flows. The impairment assessment resulted in a $2.2 million non-cash goodwill impairment charge. The European tableware business is a reporting unit within the International segment. The fair value of the reporting unit was determined based on a combined income and market approach. The resulting fair value was approximately 12 % below the reporting unit’s carrying value. The Company bypassed the optional qualitative impairment analysis for its reporting units with goodwill for its annual October 1, 2018 impairment test. Accordingly, the estimated fair value of each of the reporting units was determined using the income approach and market approach. The significant assumptions used under the income approach, or discounted cash flow method, are projected net sales, projected earnings before interest, tax, depreciation and amortization (“EBITDA”), terminal growth rates, and the cost of capital. Projected net sales, projected EBITDA and terminal growth rates were determined to be significant assumptions because they are three primary drivers of the projected cash flows in the discounted cash flow fair value model. Cost of capital was also determined to be a significant assumption as it is the discount rate used to calculate the current fair value of those projected cash flows. Under the income approach, the resultant estimated fair value of the reporting units exceeded their carrying value as of October 1, 2018. As of October 1 , 2018 , the excess of fair value of the European kitchenware reporting unit, which carries goodwill of $ 10.0 million, was approximately 7 % over its carrying value. Management’s projections used to estimate the cash flows include increasing net sales and operational improvements expected as a results of the consolidation of locations in the U.K. As a result of the European restructuring plan, the European kitchenware and tableware reporting units will be combined into one reporting unit as of January 1 , 2019 . Changes in any of the significant assumptions, including the identified restructuring activities used in the valuation of the reporting unit could materially affect the expected cash flows, and such impacts could potentially result in a material non-cash impairment charge. As of October 1 , 2018 , the fair value of the U.S. reporting unit, which carries goodwill of approximately $ 81.6 million was approximately 9 % over its carrying value. Management’s projections used to estimate fair value included increasing net charge. The Company is not currently aware of any negative changes in its assumptions that could lead to the fair value of the reporting units being less than the carrying value. As of December 31, 2018, the Company assessed the carrying value of goodwill and determined based on qualitative factors, no impairment existed. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2018 | |
DEBT | NOTE G — DEBT In March 2018, the Company entered into a credit agreement (the “ABL Agreement”) with JPMorgan Chase Bank, N.A. (“JPMorgan”), as administrative agent, and the lenders and issuing banks party thereto, evidencing a senior secured asset-based revolving credit facility provided to the Company in the maximum aggregate principal amount of $150.0 million, which facility will mature on March 2, 2023, and a new loan agreement (the “Term Loan” and together with the ABL Agreement, the “Debt Agreements”) with the Company, as the borrower and a guarantor, the other guarantors, JPMorgan, as administrative agent, Golub Capital LLC, as syndication agent, and the lenders party thereto, providing for a senior secured term loan credit facility to the Company in the original principal amount of $275.0 million, which will mature on February 28, 2025. The Term Loan requires quarterly payments of principal equal to 0.25% of the original aggregate principal amount of the term loan facility beginning June 30, 2018. The maximum borrowing amount under the ABL Agreement may be increased to up to $200.0 million if certain conditions are met. One or more tranches of additional term loans (the “Incremental Facilities”) may be added under the Term Loan if certain conditions are met. The Incremental Facilities may not exceed the sum of (i) $50.0 million, plus (ii) an unlimited amount so long as, in the case of (ii) only, the Company’s secured net leverage ratio, as defined in and computed pursuant to the Term Loan, is no greater than 3.75 to 1.00 subject to certain limitations and for the period defined pursuant to the Term Loan. At December 31, 2018, borrowings outstanding under the ABL Agreement were $42.1 million, and open letters of credit were $3.4 million. At December 31 2018, availability under the ABL Agreement was approximately $104.5 million. Availability under the ABL Agreement depends on the valuation of certain current assets comprising the borrowing base. Due to the seasonality of the Company’s business, this may mean that the Company will have greater borrowing availability during the third and fourth quarters of each year. The borrowing capacity under the ABL Agreement will depend, in part, on eligible levels of accounts receivable and inventory that fluctuate regularly. Consequently, the $150.0 million commitment thereunder may not represent actual borrowing capacity at any given time. At December 31, 2018, $272.9 million was outstanding under the Term Loan. At December 31, 2018, unamortized debt issuance costs of $1.5 million and $7.5 million offset the short-term and long-term outstanding balances, respectively, of the Term Loan. As of December 31, 2018, the future principal payments of the Term Loan are as follows (in thousands): 2019 $ 2,750 2020 2,750 2021 2,750 2022 2,750 2023 2,750 Thereafter 259,188 Total $ 272,938 The Company’s payment obligations under its Debt Agreements are unconditionally guaranteed by its existing and future U.S. subsidiaries, with certain minor exceptions. Certain payment obligations under the ABL Agreement are also direct obligations of its foreign subsidiary borrowers designated as such under the ABL Agreement and, subject to limitations on such guaranty, are guaranteed by the foreign subsidiary borrowers, as well as by the Company. The obligations of the Company under the Debt Agreements and any hedging arrangements and cash management services and the guarantees by its domestic subsidiaries in respect of those obligations are secured by substantially all of the assets and stock (but in the case of foreign subsidiaries, limited to 65% of the capital stock in first-tier foreign subsidiaries and not including the stock of subsidiaries of such first-tier foreign subsidiaries) owned by the Company and the U.S. subsidiary guarantors, subject to certain exceptions. Such security interest consists of (1) a first-priority lien, subject to certain permitted liens, with respect to certain assets of the Company and its domestic subsidiaries (the “ABL Collateral”) pledged as collateral in favor of lenders under the ABL Agreement and a second-priority lien in the ABL Collateral in favor of the lenders under the Term Loan and (2) a first-priority lien, subject to certain permitted liens, with respect to certain assets of the Company and its domestic subsidiaries (the “Term Loan Collateral”) pledged as collateral in favor of lenders under the Term Loan and a second-priority lien in the Term Loan Collateral in favor of the lenders under the ABL Agreement. Borrowings under the revolving credit facility bear interest, at the Company’s option, at one of the following rates: (i) an alternate base rate, defined, for any day, as the greater of the prime rate, a federal funds and overnight bank funding based rate plus 0.5% or one-month LIBOR, plus 1.0%, plus a margin of 0.25% to 0.75%, or (ii) LIBOR plus a margin of 1.25% to 1.75%. The respective margins are based upon the Company’s total leverage ratio, as defined in and computed pursuant to the ABL Agreement. Interest rates on outstanding borrowings under the ABL Agreement at December 31, 2018 ranged from 2.4% to 6.25%. In addition, the Company paid a commitment fee of 0.375% on the unused portion of the ABL Agreement during 2018. The Term Loan bears interest, at the Company’s option, at one of the following rates: (i) an alternate base rate, defined, for any day, as the greater of the prime rate, a federal funds and overnight bank funding based rate, plus 0.5% or one-month LIBOR (at the Company’s option), plus 1.0%, plus a margin of 2.50% or (ii) LIBOR plus a margin of 3.50%. The interest rate on outstanding borrowings under the Term Loan at December 31, 2018 was 6.0%. The Debt Agreements provide for customary restrictions and events of default. Restrictions include limitations on additional indebtedness, acquisitions, investments and payment of dividends, among other things. Further, the ABL Agreement provides that during any period (a) commencing on the last day of the most recently-ended four consecutive fiscal quarters on or prior to the date that availability under the ABL Agreement is less than the greater of $15.0 million or 10% of the aggregate commitment under the ABL Agreement at any time and (b) ending on the day after such availability has exceeded the greater of $15.0 million or 10% of the aggregate commitment under the ABL Agreement for forty-five (45) consecutive days, the Company is required to maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 as of the last day of any period of four consecutive fiscal quarters. The Company was in compliance with the covenants of the Debt Agreements at December 31, 2018. At December 31, 2017, borrowings outstanding under the Company’s former credit facility were $94.7 million and open letters of credit were $3.2 million. Availability under the former credit agreement was approximately $58.0 million at December 31, 2017. Upon entering into the Debt Agreements in March 2018 the Company repaid its outstanding borrowings under its former credit agreement. In connection therewith, debt issuance costs of $66,000 were written off. Other Credit Agreements A subsidiary of the Company has a credit facility (“HSBC Facility”) with HSBC Bank (China) Company Limited, Shanghai Branch (“HSBC”) for up to 18.0 million ($2.8 31, 2017, 0.5 million ($69,000) Facility. |
DERIVATIVES
DERIVATIVES | 12 Months Ended |
Dec. 31, 2018 | |
DERIVATIVES | NOTE H — DERIVATIVES The Company is a party to interest rate swap agreements, with an aggregate notional value of $125.0 million at December 31, 2018. The Company designated the interest rate swaps as cash flow hedges of the Company’s exposure to the variability of the payment of interest on a portion of its Term Loan borrowings. The hedge periods of these agreements commenced in April 2018 and expire in March 2023. The notional amounts are reduced over these periods. The Company has also entered into certain foreign exchange contracts, primarily to offset the earnings impact related to fluctuations in foreign currency exchange rates associated with inventory purchases denominated in foreign currencies. The aggregate gross notional values of foreign exchange contracts at December 31, 2017 was $34.9 The fair values of the Company’s derivative financial instruments included in the consolidated balance sheets are presented as follows (in thousands): December 31, Derivatives designated as hedging instruments Balance Sheet Location 2018 2017 Interest rate swaps Prepaid expenses $ 42 $ 11 Other assets 157 — December 31, Derivatives not designated as hedging instruments Balance Sheet Location 2018 2017 Foreign exchange contracts Accrued Expenses $ — $ 1,951 The fair value of the derivatives have been obtained from the counterparties to the agreements and were based on Level 2 observable inputs using proprietary models and estimates about relevant future market conditions. The counterparties to the derivative financial instruments are major international financial institutions. The Company is exposed to credit risk for the net exchanges under these agreements, but not for the notional amounts. The Company does not anticipate non-performance by any of its counterparties. The amounts of the gains and losses related to the Company’s derivative financial instruments designated as hedging instruments are recognized in other comprehensive income (loss) as follows (in thousands): Year ended December 31, Derivatives designated as hedging instruments 2018 2017 2016 Interest rate swaps $ 161 $ 17 $ 17 During the year ended December 31, 2018 the Company recognized $0.4 million of interest expense related to the interest rate swaps. Gains or losses on the interest rate swaps will be reclassified into earnings as interest expense as the interest expense on the debt is recognized in earnings. In connection with the financing transaction described in Note G – Debt, the Company settled its outstanding interest rate swaps, which had been accounted for as hedges and had an aggregate notional value of $5.3 million. The net gain at such time was reclassified into interest expense during the year ended December 31, 2018. The amounts of the gains and losses related to the Company’s derivative financial instruments not designated as hedging instruments are recognized in earnings as follows (in thousands): Year Ended December 31, Derivatives not designated as hedging instruments Location of Gain or (Loss) 2018 2017 2016 Foreign exchange contracts Selling, general and administrative expense $ 150 $ (2,592) $ 2,182 |
CAPITAL STOCK
CAPITAL STOCK | 12 Months Ended |
Dec. 31, 2018 | |
CAPITAL STOCK | NOTE I — CAPITAL STOCK Cash dividends Dividends were declared in 2018 and 2017 as follows: Dividend per share Date declared Date of record Payment date $0.0425 March 8, 2017 May 1, 2017 May 15, 2017 $0.0425 June 22, 2017 August 1, 2017 August 15, 2017 $0.0425 August 4, 2017 November 1, 2017 November 15, 2017 $0.0425 November 7, 2017 February 1, 2018 February 15, 2018 $0.0425 March 8, 2018 May 1, 2018 May 15, 2018 $0.0425 June 28, 2018 August 1, 2018 August 15, 2018 $0.0425 July 31, 2018 November 1, 2018 November 15, 2018 $0.0425 November 7, 2018 February 1, 2019 February 15, 2019 On March 12, 2019, the Board of Directors declared a quarterly dividend of $0.0425 per share payable on May 15, 2019 to shareholders of record on May 1, 2019. Stock repurchase program On April 30, 2013, Lifetime’s Board of Directors authorized the repurchase of up to $10.0 million of the Company’s common stock. The repurchase authorization permits the Company to effect repurchases from time to time through open market purchases and privately negotiated transactions. No shares were repurchased during the years ended December 31, 2018, 2017 and 2016. Preferred stock The Company is authorized to issue 100 shares of Series A Preferred Stock and 2,000,000 shares of Series B Preferred Stock, none of which has been issued or is outstanding at December 31, 2018. Long-term incentive plan The Company’s Amended and Restated 2000 Long-Term Incentive Plan (the “Plan”) provides for the granting of awards of up to 6,187,500 900,000 946,109 Stock options A summary of the Company’s stock option activity and related information for the three years ended December 31, 2018, is as follows: Options Weighted- average exercise price Weighted- average remaining contractual life (years) Aggregate intrinsic value Options outstanding at December 31, 2015 2,242,202 $ 14.28 Grants 66,850 15.44 Exercises (272,325 ) 9.01 Cancellations (30,750 ) 15.39 Expirations (230,577 ) 27.16 Options outstanding at December 31, 2016 1,775,400 13.44 Grants 125,750 17.38 Exercises (300,000 ) 11.34 Cancellations (45,700 ) 16.40 Expirations (99,250 ) 20.40 Options outstanding at December 31, 2017 1,456,200 13.64 Grants 205,750 13.56 Exercises (58,000 ) 4.93 Cancellations (22,375 ) 16.95 Expirations (32,750 ) 15.50 Options outstanding at December 31, 2018 1,548,825 13.87 4.2 $ 450,500 Options exercisable at December 31, 2018 1,279,825 $ 13.76 3.2 $ 450,500 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 exercisable in-the-money stock options on December 31, 2018. 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 December 31, 2018 and the exercise price. The total intrinsic values of those stock options that were exercised in the years ended December 31, 2018, 2017 and 2016 were $361,000, $2,071,000 and $1,848,000, respectively. The intrinsic value of a stock option that is exercised is calculated at the date of exercise. Total unrecognized stock option compensation expense at December 31, 2018, before the effect of income taxes, was $1.0 million and is expected to be recognized over a weighted-average period of 1.6 years. The Company values stock options using the Black-Scholes option valuation model. The Black-Scholes option valuation model, as well as other available models, was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. The Black-Scholes option valuation model requires the input of highly subjective assumptions including the expected stock price volatility and risk-free interest rate. Because the Company’s stock options have characteristics significantly different from those of traded options, changes in the subjective input assumptions can materially affect the fair value estimates of the Company’s stock options. The weighted-average per share grant date fair value of stock options granted during the years ended December 31, 2018, 2017 and 2016, was $4.47, $6.37 and $5.43, respectively. The fair values for these stock options were estimated at the dates of grant using the following weighted-average assumptions: 2018 2017 2016 Historical volatility 34 % 39 % 39 % Expected term (years) 6.0 6.0 6.0 Risk-free interest rate 2.72 % 1.97 % 1.37 % Expected dividend yield 1.22 % 0.98 % 1.10 % Restricted Stock A summary of the Company’s restricted stock activity and related information for the three years ended December 31, 2018 is as follows: Restricted Shares Weighted- average grant date fair value Non-vested restricted shares, December 31, 2015 101,435 $ 14.77 Grants 109,170 15.64 Vested (46,306 ) 14.79 Cancellations (2,475 ) 14.93 Non-vested restricted shares, December 31, 2016 161,824 15.35 Grants 133,352 18.32 Vested (69,795 ) 15.39 Cancellations (6,064 ) 16.07 Non-vested restricted shares, December 31, 2017 219,317 17.12 Grants 223,884 13.25 Vested (90,926 ) 17.14 Cancellations (25,730 ) 14.96 Non-vested restricted shares, December 31, 2018 326,545 $ 14.63 Total unrecognized compensation expense remaining $ 3,482,300 Weighted-average years expected to be recognized over 1.6 The total fair value of restricted stock that vested during the year ended December 31, 2018 was $1.1 million. Performance shares Each performance award represents the right to receive up to 150% of the target number of shares of common stock. The number of shares of common stock earned will be determined based on the attainment of specified performance goals at the end of the performance period, as determined by the Compensation Committee of the Board of Directors. The shares are subject to the terms and conditions of the Plan. A summary of the Company’s performance-based award activity and related information for the three years ended December 31, 2018 is as follows: Performance - based awards (1) Weighted- average grant date fair value Non-vested performance -based awards, December 31, 2015 66,150 $ 14.84 Grants 82,000 15.69 Cancellations (2,188 ) 14.94 Non-vested performance -based awards, December 31, 2016 145,962 15.32 Grants 87,000 18.45 Cancellations (4,070 ) 16.52 Non-vested performance -based awards, December 31, 2017 228,892 16.49 Grants 182,300 12.81 Vested (58,888 ) 14.84 Cancellations (13,017 ) 15.95 Non-vested performance -based awards, December 31, 2018 339,287 $ 14.82 Total unrecognized compensation expense remaining $ 2,388,000 Weighted-average years expected to be recognized over 1.7 (1) Represents the target number of shares to be issued for each performance-based award. The total fair value of performance-based awards that vested during the year ended December 31, 2018 was $792,000. On March 12, 2019, the Compensation Committee of the Board of Directors determined the performance goals set forth in the performance-based awards granted in 2016 were attained and 66,761 shares vested. The Company recognized total stock compensation expense of $4.1 million for the year ended December 31, 2018, of which $0.7 million represents stock option compensation expense and $3.4 million represents restricted stock and performance-based compensation expense. The Company recognized total stock compensation expense of $3.4 million for the year ended December 31, 2017, of which $1.1 million represents stock option compensation expense and $2.3 million represents restricted stock and performance-based compensation expense. The Company recognized total stock compensation expense of $2.9 million for the year ended December 31, 2016, of which $1.4 million represents stock option compensation expense, $1.5 million represents restricted stock, including restricted stock granted to directors and performance-based compensation expense, and $32,000 represents stock awards. |
(LOSS) INCOME PER COMMON SHARE
(LOSS) INCOME PER COMMON SHARE | 12 Months Ended |
Dec. 31, 2018 | |
INCOME PER COMMON SHARE | NOTE J — (LOSS) INCOME PER COMMON SHARE Basic income per common share has been computed by dividing net income by the weighted-average number of shares of the Company’s common stock outstanding. Diluted income per common share adjusts net income and basic income per common share for the effect of all potentially dilutive shares of the Company’s common stock. 2018 2017 2016 (in thousands - except per share amounts) Net (loss) income – Basic and Diluted $ (1,720 ) $ 2,154 $ 15,720 Weighted-average shares outstanding – Basic 19,452 14,505 14,174 Effect of dilutive securities: Stock options and other stock awards — 450 375 Weighted-average shares outstanding – Diluted 19,452 14,955 14,549 Basic (loss) income per common share $ (0.09 ) $ 0.15 $ 1.11 Diluted (loss) income per common share $ (0.09 ) $ 0.14 $ 1.08 The computations of diluted income per common share for the years ended December 31, 2018, 2017 and 2016 excludes 1,869,120, 1,190,261 and 1,335,113, respectively, related to options to purchase shares and other stock awards. These shares were excluded due to their antidilutive effect. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
INCOME TAXES | NOTE K — INCOME TAXES The components of income before income taxes and equity in earnings are as follows: Year Ended December 31, 2018 2017 2016 (in thousands) Domestic $ 5,455 $ 17,728 $ 22,114 Foreign (4,946 ) (6,949 ) (112 ) Total income before income taxes and equity in earnings $ 509 $ 10,779 $ 22,002 The provision for income taxes (before equity in earnings) consists of: Year Ended December 31, 2018 2017 2016 (in thousands) Current: Federal $ 775 $ 7,041 $ 8,000 State and local 351 957 498 Foreign (323 ) 4 483 Deferred 2,086 1,030 (1,951 ) Income tax provision $ 2,889 $ 9,032 $ 7,030 On December 22 , 2017 , the Tax Act was enacted. The Tax Act revises the U.S. corporate income tax by, among other things, lowering the corporate income tax rate from 35 % to 21 %, adopting a quasi-territorial income tax system, imposing a one-time transition tax on foreign unremitted earnings, and setting limitations on the deductibility of certain costs (e.g., interest expense). For the year ended December 31 , 2017 , the Company accrued $ 338,000 of tax expense for the Tax Act’s one-time transition tax on the Company’s material wholly owned foreign subsidiaries’ accumulated, unremitted earnings and $ 3.0 million in provisional expense related to the net change in deferred tax assets stemming from the Tax Act’s reduction of the U.S. federal tax rate from 35 % to 21 %. In response to the Act, the U.S. Securities and Exchange Commission (“SEC”) provided guidance by issuing Staff Accounting Bulletin No. 118 (“SAB 118”), which has since been codified by the release of ASU No. 2018- 05, Income Taxes (Topic 740): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. ASU 2018-05 allows companies to record provisional amounts during a measurement period with respect to the impacts of the Act for which the accounting requirements under ASC Topic 740 are not complete, but a reasonable estimate has been determined. The measurement period under ASU 2018-05 ends when a company has obtained, prepared, and analyzed the information that was needed in order to complete the accounting requirements under ASC Topic 740, but cannot exceed one year. As of December, 31, 2018, the Company has completed the accounting for the effects of the Act. The Company has included the impact of the Act on its annual effective tax rate and has recorded an additional provision of $ 0.7 million primarily related to an adjustment to the estimated transition tax liability, including an uncertain tax position. Since January 1, 2018, the Tax Act has subjected the Company to a tax on global intangible low-taxed income (“ GILTI ”) earned by certain foreign subsidiaries, base erosion anti-abuse tax (“BEAT”), foreign derived intangible income tax (“ FDII ”), and IRC Section 163(j) interest limitation (“Interest Limitation”). Entities can make an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. The Company has elected to account for the GILTI tax as a current period expense. The Company did not have GILTI liability and was not subject to BEAT in 2018. The tax impact of FDII was immaterial. The Company incurred an Interest Limitation in 2018, resulting in a deferred tax asset related to interest carried forward of approximately $1.0 million. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. December 31, 2018 2017 (in thousands) Deferred income tax assets: Deferred rent expense $ 3,504 $ 2,212 Stock options 2,982 2,903 Inventory 1,446 970 Operating loss and non-deductible interest carry-forward 7,071 4,114 Accounts receivable allowances 734 264 Accrued compensation 1,026 623 Depreciation and amortization — 247 Other 1,753 1,882 Total deferred income tax assets $ 18,516 $ 13,215 Deferred income tax liabilities: Fixed assets $ (2,540 ) $ — Intangibles (27,534 ) (8,732 ) Equity in earnings — (56 ) Total deferred income tax liabilities (30,074 ) (8,788 ) Net deferred income tax (liability) asset (11,558 ) 4,427 Valuation allowance (2,850 ) (3,024 ) Net deferred income tax (liability) asset $ (14,408 ) $ 1,403 As of December 31, 2018, a preliminary net deferred tax liability of $13.9 million was recorded in purchase accounting in connection with the Filament acquisition, including uncertain tax positions of $0.3 million. The Company continues to assess the tax accounting consideration under business combination accounting which concludes during the first quarter of 2019. The Company has generated various state net operating loss carryforwards of which $24.9 million remained at December 31, 2018 that begin to expire in 2026. 2020. The Company also has U.S. losses of $5.3 million that can be carried forward indefinitely and are subject to IRC section 382 limitations. The provision for income taxes (before equity in earnings) differs from the amounts computed by applying the applicable federal statutory rates as follows: Year Ended December 31, 2018 2017 2016 Provision for federal income taxes at the statutory rate 21.0 % 35.0 % 35.0 % Increases (decreases): State and local income taxes, net of Federal income tax benefit 97.4 6.1 3.6 Foreign rate differences (110.3 ) 7.2 (7.9 ) Non-deductible expenses 228.5 3.7 3.4 Tax Act- revaluation of net deferred tax assets and other 16.8 27.7 — Tax Act- transition tax 43.0 3.1 — Uncertain tax positions 302.8 0.6 — Research and development credit (18.5 ) — — Federal return to provision (27.5 ) — — Other 14.4 0.4 (2.1 ) Provision for income taxes 567.6 % 83.8 % 32.0 % The estimated values of the Company’s gross uncertain tax positions at December 31, 2018, 2017 and 2016 are liabilities of $2.0 million, $161,000 and $109,000, respectively, and consist of the following: Year Ended December 31, 2018 2017 2016 (in thousands) Balance at January 1 $ (161 ) $ (109 ) $ (157 ) Additions based on tax positions related to the current year (626 ) (82 ) — Additions based on tax positions related to the prior year (1,302 ) — — Reductions for tax position of prior years 114 30 — Settlements — — 48 Balance at December 31 $ (1,975 ) $ (161 ) $ (109 ) The Company had approximately $29,000 and $24,000, net of federal and state tax benefit, accrued at December 31, 2018 and 2017, respectively, for the payment of interest. The Company’s policy for recording interest and penalties is to record such items as a component of the provision for income taxes. If the Company’s tax positions are ultimately sustained, the Company’s liability, including interest, would be reduced by $2.0 million, all of which would impact the Company’s tax provision. On a quarterly basis, the Company evaluates its tax positions and revises its estimates accordingly. The Company believes that it is reasonably possible that none of its tax positions will be resolved within the next twelve months. The Company is no longer subject to U.S. Federal income tax examinations for the years prior to 2015. The Company has identified the following jurisdictions as “major” tax jurisdictions: At December 31, 2018, the periods subject to examination by the Company’s major state jurisdictions are generally for the years ended 2014 through 2017 |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 12 Months Ended |
Dec. 31, 2018 | |
BUSINESS SEGMENTS | NOTE L BUSINESS SEGMENTS Segment information The Company has two reportable segments, U.S. and International. Prior to October 1, 2018, the U.S. segment was reported as two separate reportable segments, U.S. Wholesale and Retail Direct. The Company changed its reporting structure to reflect how the Company is managing its operations as well as what the chief operating decision maker reviews to make organizational decisions about resource allocations. Prior period segment information has been recast to reflect the current reportable segment structure of the Company. The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. The U.S. segment includes the Company’s primary domestic business that designs, markets and distributes its products to retailers, distributors and its internet websites. The International Segment consists of certain business operations conducted outside the U.S. Management evaluates the performance of the U.S. and International 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 fees and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. Year Ended December 31, 2018 2017 2016 (in thousands) Net sales: U.S. $ 611,973 $ 481,719 $ 491,549 International 92,569 97,757 101,070 Total net sales $ 704,542 $ 579,476 $ 592,619 Income from operations: U.S. (1) $ 44,213 $ 39,341 $ 40,515 International (2) (5,395 ) (6,984 ) 3,052 Unallocated corporate expenses (20,239 ) (17,177 ) (16,490 ) Total income from operations $ 18,579 $ 15,180 $ 27,077 Depreciation and amortization: U.S. (3) $ 18,840 $ 10,004 $ 10,231 International 4,489 4,185 3,917 Total depreciation and amortization $ 23,329 $ 14,189 $ 14,148 Capital expenditures: U.S. $ 7,746 $ 4,176 $ 2,956 International 156 2,135 424 Total capital expenditures $ 7,902 $ 6,311 $ 3,380 (1) In 2018 and 2016, income from operations for the U.S. segment includes $2.1 million and $2.4 million, respectively, of restructuring expenses related to the Filament integration and the U.S. restructuring plan, respectively, as described in Note A – Significant Accounting Policies. The 2016 period also includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. (2) In 2018 and 2017 income from operations for the International segment includes $1.0 million of restructuring expenses related to the integration of entities in Europe, as described in Note A – Significant Accounting Policies. (3) The 2016 period includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. December 2018 2017 (in thousands) Assets: U.S. $ 604,532 $ 282,011 International 94,210 105,984 Unallocated/ corporate/ other 9,830 13,526 Total assets $ 708,572 $ 401,521 Year Ended December 2018 2017 (in thousands) Goodwill: U.S. Beginning balance $ 2,846 $ 2,412 Acquisition activity 78,795 434 Ending balance 81,641 2,846 International Beginning balance 12,926 11,789 Foreign currency translation adjustment (672 ) 1,137 Impairment (2,205 ) — Ending balance 10,049 12,926 Total goodwill $ 91,690 $ 15,772 Geographical information The following table sets forth long-lived assets by the major geographic locations: December, 2018 2017 (in thousands) Long-lived assets, excluding intangible assets, at period-end: United States $ 47,812 $ 45,285 United Kingdom 1,896 2,779 Rest of World 480 729 Total $ 50,188 $ 48,793 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2018 | |
COMMITMENTS AND CONTINGENCIES | NOTE M — COMMITMENTS AND CONTINGENCIES Operating leases The Company has lease agreements for its corporate headquarters, distribution centers, showrooms and sales offices that expire through 2029. These leases generally provide for, among other things, annual base rent escalations and additional rent for real estate taxes and other costs. Future minimum payments under non-cancelable operating leases are as follows (in thousands): Year Ending December 31 , 2019 $ 16,238 2020 14,898 2021 14,498 2022 14,744 2023 14,589 Thereafter 62,698 Total $ 137,665 Future minimum lease payments exclude payments for leases that have not yet commenced. Rent and related expenses under operating leases were $18.4 million, $16.8 million and $16.6 million for the years ended December 31, 2018, 2017 and 2016, respectively. Royalties The Company has license agreements that require the payment of royalties on sales of licensed products which expire through 2023 . Future minimum royalties payable under these agreements are as follows (in thousands): Year ending December 31 , 2019 $ 7,927 2020 8,485 2021 8,942 2022 926 2023 156 Thereafter — Total $ 26,436 Legal proceedings Wallace Silversmiths de Puerto Rico, Ltd. (“WSPR”), 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, WSPR 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, and Liability Act (“CERCLA”). In July 2011, WSPR received a letter from the EPA requesting access to the property that it leases from PRIDCO to conduct an environmental investigation, and the Company granted such access. In February 2013, the EPA requested access to conduct a further environmental investigation at the property. PRIDCO agreed to such access and the Company consented. The EPA conducted a further investigation during 2013 and, in April 2015, notified the Company and PRIDCO that the results from vapor intrusion sampling may warrant the implementation of measures to mitigate potential exposure to sub-slab soil gas. The Company reviewed the information provided by the EPA and requested that PRIDCO, as the property owner, find and implement a solution acceptable to the EPA. While WSPR did not cause the sub-surface condition that resulted in the potential for vapor intrusion, in order to protect the health of its employees and continue its business operations, it has nevertheless implemented corrective action measures to prevent vapor intrusion, such as sealing the floors of the building and conducting periodic air monitoring to address potential exposure. On August 13, 2015, the EPA released its remedial investigation and feasibility study (“RI/FS”) for the Site. On December 11, 2015, the EPA issued the Record of Decision (“ROD”) for an initial operable unit, electing to implement its preferred remedy which consists of soil vapor extraction and dual-phase extraction/ in-situ treatment. This selected remedy includes soil vapor extraction (“SVE”) to address soil (vadose zone) source areas at the Site, impermeable cover as necessary for the implementation of SVE, dual phase extraction in the shallow saprolite zone, and in-situ In December 2018, the Company, WSPR, and other identified Potentially Responsible Parties affiliated with the Site entered into tolling agreements to extend the statute of limitations for potential claims for the recovery of response costs for the initial operable unit under Section 107 of CERCLA. The tolling agreements do not constitute in any way an admission or acknowledgment of any fact, conclusion of law or liability by the parties to the agreements. Accordingly, based on the above uncertainties and variables, it is not possible at this time for the Company to estimate its share of liability, if any, related to this matter. However, in the event of one or more adverse determinations related to this matter, it is possible that the ultimate liability resulting from this matter and the impact on the Company’s results of operations could be material. 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 Contingencies The Company identified certain probable and estimable non-income tax exposure matters in connection with its acquisition of Filament and recorded an accrual of approximately $1.9 |
OTHER
OTHER | 12 Months Ended |
Dec. 31, 2018 | |
OTHER | NOTE O — OTHER Inventory The components of inventory are as follows: December 31, 2018 2017 (in thousands) Finished goods $ 165,969 $ 125,355 Work in process 375 86 Raw materials 7,257 6,995 Total $ 173,601 $ 132,436 Property and equipment Property and equipment consist of: December 31, 2018 2017 (in thousands) Machinery, furniture and equipment $ 106,525 $ 91,282 Leasehold improvements 29,803 32,591 Building and improvements 770 787 Construction in progress 1,032 3,122 Land 100 100 138,230 127,882 Less: accumulated depreciation and amortization (112,468 ) (104,817 ) Total $ 25,762 $ 23,065 Depreciation and amortization expense of property and equipment for the years ended December 31, 2018, 2017 and 2016 was $8.0 million, $6.6 million and $8.0 million, respectively Included in machinery, furniture and equipment at each of December 31, 2018 and 2017 is $1.8 million and $2.0 million, respectively, related to assets recorded under capital leases. Included in accumulated depreciation and amortization at December 31, 2018 and December 31, 2017 is $1.7 million and $1.9 million, respectively, related to assets recorded under capital leases. Accrued expenses Accrued expenses consist of: December 31, 2018 2017 (in thousands) Customer allowances and rebates $ 12,184 $ 11,662 Compensation and benefits 9,065 9,613 Interest 243 191 Vendor invoices 3,487 4,027 Royalties 1,916 1,744 Commissions 1,557 786 Freight 4,160 4,002 Professional fees 2,473 3,160 VAT 79 1,176 Foreign exchange contracts — 1,951 Restructuring 1,557 — Other 8,735 5,809 Total $ 45,456 $ 44,121 Deferred rent & other long-term liabilities Deferred rent & other long-term liabilities consist of: December 31, 2018 2017 (in thousands) Deferred rent liability $ 13,832 $ 13,399 Retirement benefit obligations 6,169 6,829 Non-income tax liability 1,860 — Royalty obligation 1,324 — Other long term obligations 154 21 Total $ 23,339 $ 20,249 Supplemental cash flow information Year Ended December 31, 2018 2017 2016 (in thousands) Supplemental disclosure of cash flow information: Cash paid for interest $ 16,319 $ 3,791 $ 4,171 Cash paid for taxes 2,599 12,936 6,384 Non-cash investing activities: Translation adjustment $ (5,906 ) $ 7,823 $ (23,061 ) Components of accumulated other comprehensive loss, net Year Ended December 31, 2018 2017 2016 (in thousands) Accumulated translation adjustment: Balance at beginning of year $ (27,821 ) $ (35,644 ) $ (12,961 ) Translation adjustment during period (5,906 ) 7,823 (23,061 ) Amounts reclassified from accumulated other comprehensive loss: (1) Currency translation adjustment — — 378 Balance at end of year $ (33,727 ) $ (27,821 ) $ (35,644 ) Accumulated deferred gains (losses) on cash flow hedges: Balance at beginning of year $ 14 $ (3 ) $ (20 ) Amounts reclassified from accumulated other comprehensive loss: (2) Settlement of cash flow hedge (14 ) — — Derivative fair value adjustment, net of tax 161 17 17 Balance at end of year $ 161 $ 14 $ (3 ) Accumulated effect of retirement benefit obligations: Balance at beginning of year $ (1,518 ) $ (1,352 ) $ (1,204 ) Net gain (loss) arising from retirement benefit obligations, net of tax 373 (228 ) (202 ) Amounts reclassified from accumulated other comprehensive loss: Amortization of loss, net of tax (3) 95 62 54 Balance at end of year $ (1,050 ) $ (1,518 ) $ (1,352 ) (1) Amount is recorded in equity in earnings (losses) on the consolidated statements of operations. (2) Amounts reclassified are recorded in interest expense on the consolidated statement of operations. (3) Amount is recorded in selling, general and administrative expenses on the consolidated statements of operations. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2018 | |
Valuation and Qualifying Accounts | COL. A COL. B COL. C COL. D COL. E Description Balance at Additions Due to Charged to Deductions Balance at Year ended December 31, 2018 Deducted from asset accounts: Allowance for doubtful accounts $ 1,158 $ — $ 786 $ (448 )(a) $ 1,496 Reserve for sales returns and allowances 5,032 421 4,296 (c) (3,390 )(b) 6,359 $ 6,190 $ 421 $ 5,082 $ (3,838 ) $ 7,855 Year ended December 31, 2017 Deducted from asset accounts: Allowance for doubtful accounts $ 648 $ — $ 594 $ (84 )(a) $ 1,158 Reserve for sales returns and allowances 5,077 — 4,332 (c) (4,377 )(b) 5,032 $ 5,725 $ — $ 4,926 $ (4,461 ) $ 6,190 Year ended December 31, 2016 Deducted from asset accounts: Allowance for doubtful accounts $ 697 $ — $ 127 $ (176 )(a) $ 648 Reserve for sales returns and allowances 4,603 — 5,110 (c) (4,636 )(b) 5,077 $ 5,300 $ — $ 5,237 $ (4,812 ) $ 5,725 Year ended December 31, 2015 Deducted from asset accounts: Allowance for doubtful accounts $ 815 $ — $ 226 $ (344 )(a) $ 697 Reserve for sales returns and allowances 5,848 — 6,504 (c) (7,749 )(b) 4,603 $ 6,663 $ — $ 6,730 $ (8,093 ) $ 5,300 (a) Uncollectible accounts written off, net of recoveries. (b) Allowances granted. (c) Charged to net sales. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Basis of presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for financial information and with the instructions to Form 10-K. The accompanying consolidated financial statements include estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these financial statements in conformity with U.S. GAAP. The most significant of these estimates and assumptions relate to revenue recognition, allowances for doubtful accounts, reserves for sales returns and allowances and customer chargebacks, inventory mark-down provisions, impairment of tangible and intangible assets, stock based compensation expense, estimates for unpaid healthcare claims, derivative valuations, accruals related to the Company’s tax positions and tax valuation allowances. Although these and other estimates and assumptions are based on the best available information, actual results could be materially different from these estimates. |
Principles of consolidation | Principles of consolidation The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. |
Foreign currency | Foreign currency Foreign currency denominated assets and liabilities are translated into U.S. dollars at exchange rates prevailing at the balance sheet dates. Revenues, costs and expenses are translated into U.S. dollars at average exchange rates for the relevant period. Income and losses resulting from translation are recorded as a component of accumulated other comprehensive income (loss). Gains and losses from foreign currency transactions, including the unrealized gain or loss on the fair value of foreign exchange contracts not designated as hedges and the realized gain or loss on all foreign exchange contracts, whether or not designated as hedges, are recognized in selling, general and administrative expenses in the consolidated statements of operations. Foreign currency gain/loss included within selling, general and administrative expenses was a $0.5 million loss in 2018, a $3.0 million loss in 2017 and a $4.2 million gain in 2016. |
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 at the point in time the customer obtains control of the products, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those products. The Company offers various sales incentives and promotional programs to its customers 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 returns are reflected as reductions of revenue at the time of sale. See Note B – Revenue for additional information. |
Cost of sales | Cost of sales Cost of sales consist primarily of costs associated with the production and procurement of product, inbound freight costs, purchasing costs, royalties and other product procurement related charges. |
Distribution expenses | Distribution expenses Distribution expenses consist primarily of warehousing expenses and freight-out expenses. Freight-out expenses were $14.5 million, $11.5 million and $11.0 million for the years ended December 31, 2018, 2017 and 2016, respectively. Handling costs of products sold are included in cost of sales. |
Advertising expenses | Advertising expenses Advertising expenses are expensed as incurred and are included in selling, general and administrative expenses. Advertising expenses were $4.4 million, $3.4 million and $3.7 million for the years ended December 31, 2018, 2017 and 2016, respectively. |
Accounts receivable | Accounts receivable The Company periodically reviews the collectability of its accounts receivable and establishes allowances for estimated losses that could result from the inability of its customers to make required payments. A considerable amount of judgment is required to assess the ultimate realization of these receivables including assessing the initial and on-going creditworthiness of the Company’s customers. The Company also maintains an allowance for anticipated customer deductions. The allowances for deductions are primarily based on contracts with customers. However, in certain cases the Company does not have a formal contract and, therefore, customer deductions are non-contractual. To evaluate the reasonableness of non-contractual customer deductions, the Company analyzes currently available information and historical trends of deductions. The sale of accounts receivable, under the Company’s Receivable Purchase Agreement with HSBC, are reflected as a reduction of accounts receivable in the Company’s consolidated balance sheet at the time of sale and any related expense is included in selling, general and administrative expenses in the Company’s consolidated statements of operations. |
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 using the lower of cost (first-in, first-out basis) or net realizable value. 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. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable cost of completion, disposal and transportation. |
Property and equipment | Property and equipment Property and equipment is stated at cost. Property and equipment, other than leasehold improvements, are depreciated using the straight-line method over the estimated useful lives of the assets. Building and improvements are depreciated over 30 years and machinery, furniture and equipment over periods ranging from 3 to 10 years. Leasehold improvements are amortized over the term of the lease or the estimated useful lives of the improvements, whichever is shorter. Advances paid towards the acquisition of property and equipment and the cost of property and equipment not ready for use before the end of the period are classified as construction in progress. |
Cash equivalents | Cash equivalents The Company considers all highly liquid instruments with a maturity of three months or less when purchased to be cash equivalents. |
Concentration of credit risk | Concentration of credit risk The Company’s cash and cash equivalents are potentially subject to concentration of credit risk. The Company maintains cash with several financial institutions that, in some cases, is in excess of Federal Deposit Insurance Corporation insurance limits. Concentrations of credit risk with respect to trade accounts receivable are limited due to the large number of entities comprising the Company’s customer base. During the years ended December 31, 2018, 2017 and 2016, Wal-Mart Stores, Inc., including Sam’s Club and, in the United Kingdom, Asda Superstore, (“Walmart”), accounted for 14%, 15% and 16% of net sales, respectively. During the year ended December 31, 2016, Costco Wholesale Corporation, (“Costco”), accounted for 10% of net sales. Sales to Walmart are included in the Company’s U.S. and International segments. Sales to Costco are primarily included in the U.S. segment. No other customers accounted for 10% or more of the Company’s sales during these periods. |
Fair value measurements | Fair value measurements Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures , provides enhanced guidance for using fair value to measure assets and liabilities and establishes a common definition of fair value, provides a framework for measuring fair value under U.S. generally accepted accounting principles and expands disclosure requirements about fair value measurements. Fair value measurements included in the Company’s consolidated financial statements relate to the Company’s annual goodwill and other intangible asset impairment tests and derivatives, described in Notes F- Goodwill and Intangible Assets and H- Derivatives, respectively. |
Fair value of financial instruments | Fair value of financial instruments The Company determined that 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 ABL Agreement and 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 815, Derivatives and Hedging , (“ASC 815”). ASC 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 until the hedged item is recognized in earnings. The change in the fair value of hedges are included in accumulated other comprehensive income (loss) and is subsequently recognized in the Company’s consolidated statements of operations to mirror the location of the hedged items impacting earnings. For derivatives that do not qualify or are not designated as hedging instruments for accounting purposes, changes in fair value are recorded in operations. |
Goodwill, intangible assets and long-lived assets | Goodwill, intangible assets and long-lived assets Goodwill and intangible assets deemed to have indefinite lives are not amortized but, instead, are subject to an annual impairment assessment. Additionally, if events or conditions were to indicate the carrying value of a reporting unit may not be recoverable, the Company would evaluate goodwill and other intangible assets for impairment at that time. As it relates to the goodwill assessment, the Company first assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment testing described in ASU Topic 350, Intangibles – Goodwill and Other . If, after assessing qualitative factors, the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative test is unnecessary and the Company’s goodwill is considered to be unimpaired. However, if based on the Company’s qualitative assessment it concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, or if the Company elects to bypass the qualitative assessment, the Company will proceed with performing the quantitative impairment test. In January 2017, the FASB issued revised guidance that simplifies the test for goodwill impairment, effective for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company elected to early adopt the guidance in the third quarter of 2018. Under the revised guidance, if a reporting unit’s carrying value exceeds its fair value, an impairment charge will be recorded to reduce the reporting unit to fair value. Prior to the revised guidance, the amount of the impairment was the difference between the carrying value of the goodwill and the “implied” fair value, which was calculated as if the reporting unit had just been acquired and accounted for as a business combination. The Company also evaluates qualitative factors to determine whether or not its indefinite lived intangibles have been impaired and then performs quantitative tests if required. These tests can include the relief from royalty model or other valuation models. Long-lived assets, including intangible assets deemed to have finite lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Impairment indicators include, among other conditions, cash flow deficits, historic or anticipated declines in revenue or operating profit or material adverse changes in the business climate that indicate that the carrying amount of an asset may be impaired. When impairment indicators are present, the recoverability of the asset is measured by comparing the carrying value of the asset to the estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of the asset is not recoverable, the impairment to be recognized is measured by the amount by which the carrying amount of each long-lived asset exceeds the fair value of the asset. |
Income taxes | Income taxes The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. The Company accounts for foreign income taxes based upon anticipated reinvestment of profits into respective foreign tax jurisdictions. The Company applies the authoritative guidance for the financial statement recognition, measurement and disclosure of uncertain tax positions recognized in the Company’s financial statements . In accordance with this guidance, tax positions must meet a more-likely-than-not recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position. A valuation allowance is required to be established or maintained when it is “more likely than not” that all or a portion of deferred tax assets will not be realized. |
Share-based compensation | Share-based compensation The Company accounts for its share-based compensation arrangements in accordance with ASC Topic 718, Stock Compensation , which requires the measurement of compensation expense for all share-based compensation granted to employees and non-employee directors at fair value on the date of grant and recognition of compensation expense over the related service period. Forfeitures are accounted for as they occur. The Company uses the Black-Scholes option valuation model to estimate the fair value of its stock options. The Black-Scholes option valuation model requires the input of highly subjective assumptions including the expected stock price volatility of the Company’s common stock and the risk-free interest rate. Changes in these subjective input assumptions can materially affect the fair value estimate of the Company’s stock options on the date of the option grant. Performance share awards are initially valued at the Company’s closing stock price on the date of grant. Each performance award represents the right to receive up to 150% The Company bases the estimated fair value of restricted stock awards on the date of grant. The estimated fair value is determined based on the closing price of the Company’s common stock on the date of grant multiplied by the number of shares awarded. Compensation expense is recognized on a straight-line basis over the vesting period. |
Employee healthcare | Employee healthcare The Company self-insures certain portions of its health insurance plan. The Company maintains an accrual for estimated unpaid claims and claims incurred but not yet reported (“IBNR”). Although management believes that it uses the best information available to estimate IBNR claims, actual claims may vary significantly from estimated claims. |
Restructuring expenses | Restructuring expenses Costs associated with restructuring activities are recorded at fair value when a liability has been incurred. A liability has been incurred at the point of closure for any remaining operating lease obligations and at the communication date for severance. In connection with the Company’s March 2018 acquisition of Filament, the Company commenced a restructuring plan to integrate the operations of Filament with the Company’s operations and realize the savings expected from the synergies of the acquisition. During the year ended December 31, 2018 the Company incurred $2.1 restructuring charges, primarily related to severance, of which $1.4 During the years ended December 31, 2018 and 2017, the Company incurred $0.2 million and $1.0 $1.5 During the year ended December 31, 2016 the Company recorded $2.4 million of restructuring expense related to its review of the U.S. segment, which included the realignment of product categories and implementation of cost reduction initiatives. |
Commitments and Contingencies | Commitments and Contingencies The Company is subject to various claims and contingencies related to lawsuits, certain taxes and environmental matters, as well as commitments under contractual and other commercial obligations. The Company recognizes liabilities for contingencies and commitments when a loss is probable and estimable. |
Adopted Accounting Pronouncements | Adopted Accounting Pronouncements Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2017-01, Clarifying the Definition of a Business . This standard assists with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This standard will be applied prospectively to acquisitions and has not had an impact on the Company’s consolidated financial statements. Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers Effective January 1, 2018, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. The guidance also makes certain improvements to simplify the application of hedge accounting guidance and ease the administrative burden of hedge documentation requirements and assessing hedge effectiveness. The Company applied the new guidance to existing cash flow hedge relationships using a modified retrospective approach. No adjustment was recorded to opening retained earnings on the date of adoption, as there was no ineffectiveness previously recorded in retained earnings that would have been included in other comprehensive income if the new guidance had been applied since hedge inception. The adoption of this ASU did not have a material impact on the Company’s financial condition, results of operations or cash flows. Effective September 30, 2018, the Company adopted ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment |
Accounting Pronouncements to be Adopted in Future Periods | Accounting pronouncements to be adopted in future periods Updates not listed below were assessed and either determined to not be applicable or are expected to have a minimal effect on the Company’s financial position, results of operations, and disclosures. In February 2018, the FASB issued ASU 2018-02, Income Statement- Reporting Comprehensive Income: Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which reduces the diversity in practice on how certain transactions are classified in the statement of cash flows. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. Early adoption is permitted. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires a lessee, in most leases, to initially recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those years. The guidance requires adoption using a modified retrospective transition approach with either 1) periods prior to the adoption date being recast or 2) a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. The Company adopted this standard on January 1, 2019 using the cumulative-effect adjustment method and elected certain practical expedients allowed under the standard. The Company’s project team assessed the effect of the adoption of this standard on its accounting policies, business processes, internal controls over financial reporting and related disclosures. Upon adoption, the Company estimates assets and liabilities will increase by approximately $91.0 million and $104.5 million, respectively. Changes in the Company’s lease population or changes in incremental borrowing rates may alter this estimate. The Company does not expect to recognize a material cumulative-effect adjustment to retained earnings upon adoption. The Company will provide expanded disclosures as a result of the guidance upon adoption. |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Company's Revenue Disaggregated by Geographic Region and Revenue | The following tables present the Company’s net sales disaggregated by segment, product category and geographic region for the years ended December 31, 2018, 2017 and 2016 (in thousands). Year Ended December 31, 2018 2017 2016 (in thousands) U.S. segment Kitchenware $ 331,603 $ 276,745 $ 287,100 Tableware 169,709 152,846 155,961 Home Solutions 110,661 52,128 48,488 Total U.S. segment 611,973 481,719 491,549 International segment Kitchenware 58,164 59,686 59,742 Tableware 34,405 38,071 41,328 Total International segment 92,569 97,757 101,070 Total net sales $ 704,542 $ 579,476 $ 592,619 Year ended December 31, 2018 2017 2016 (in thousands) United States $ 575,158 $ 460,788 $ 472,962 United Kingdom 65,852 74,834 74,991 Rest of World 63,532 43,854 44,666 Total net sales $ 704,542 $ 579,476 $ 592,619 |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Filament | |
Summary of Purchase Price | The purchase price, as adjusted, has been determined to be as follows (in thousands): Cash $ 217,511 Share consideration 76,905 Total purchase price $ 294,416 |
Summary of Purchase Price Allocated Based on Estimated Fair Value of Assets and Liabilities | 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): Accounts receivable $ 26,224 Inventory 29,444 Other assets 5,620 Other liabilities (22,449 ) Deferred income tax (13,877 ) Goodwill and other intangibles 269,454 Total allocated value $ 294,416 |
Summary of Pro Forma Consolidated Net Sales and Income (Loss) Before Income Taxes and Equity in Earnings | Year ended December 31, 2018 2017 (In thousands, except per share data) Net sales $ 730,353 $ 747,549 Income before income taxes and equity in earnings 2,439 14,151 Net (loss) income (267 ) 5,794 Diluted (loss) income per common share $ (0.01 ) $ 0.28 |
Fitz and Floyd Business [Member] | |
Summary of Purchase Price Allocated Based on Estimated Fair Value of Assets and Liabilities | The purchase price was allocated based on the Company’s estimate of the fair values of the assets acquired and liabilities assumed, as follows (in thousands): Accounts Receivable $ 3,115 Inventory 5,424 Other assets 458 Other liabilities (2,056 ) Goodwill and other intangibles 2,131 Total allocated value $ 9,072 |
EQUITY INVESTMENTS (Tables)
EQUITY INVESTMENTS (Tables) - Grupo Vasconia S.A.B. | 12 Months Ended |
Dec. 31, 2018 | |
Summarized Income Statement Information for Vasconia in USD and MXN | Summarized income statement information for the years ended December 31, 2018, 2017 and 2016, as well as summarized balance sheet information as of December 31, 2018 and 2017, for Vasconia, calculated in accordance with U.S. GAAP, in USD and MXN is as follows: Year Ended December 31, 2018 2017 2016 (in thousands) USD MXN USD MXN USD MXN Income Statement Net sales $ 179,547 $ 3,456,852 $ 167,283 $ 3,157,671 $ 149,533 $ 2,795,009 Gross profit 36,891 711,941 34,626 655,186 27,205 510,617 Income from operations 11,402 222,115 10,475 199,170 5,611 105,334 Net income 2,887 57,590 1,164 23,983 3,491 68,230 |
Summarized Balance Sheet Information for Vasconia in USD and MXN | December 31, 2018 2017 (in thousands) USD MXN USD MXN Balance Sheet Current assets $ 96,135 $ 1,888,602 $ 91,157 $ 1,793,832 Non-current assets 86,279 1,694,969 87,900 1,729,745 Current liabilities 64,831 1,273,619 50,766 998,993 Non-current liabilities 32,261 633,772 39,147 770,352 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Components of Intangible Assets Included in Wholesale Segment | The Company’s intangible assets, all of which are included in the U.S. and International segments, consist of the following (in thousands): Year Ended December 31, 2018 2017 Gross Impairment Accumulated Amortization Net Gross Accumulated Amortization Net Goodwill $ 93,895 $ (2,205 ) $ — $ 91,690 $ 15,772 $ — $ 15,772 Indefinite -lived intangible assets: Trade names 58,216 — — 58,216 7,616 — 7,616 Finite -lived intangible assets: Licenses 15,847 (9,825 ) 6,022 15,847 (9,375 ) 6,472 Trade names 43,689 (13,965 ) 29,724 33,368 (11,109 ) 22,259 Customer relationships 175,482 (27,538 ) 147,944 52,961 (16,966 ) 35,995 Other 6,510 (1,259 ) 5,251 1,165 (800 ) 365 Total $ 393,639 $ (2,205 ) $ (52,587 ) $ 338,847 $ 126,729 $ (38,250 ) $ 88,479 |
Summary of Activities Relating to Intangible Assets | A summary of the activities related to the Company’s intangible assets for the years ended December 31, 2018, 2017 and 2016 consists of the following (in thousands): Intangible Assets Goodwill Total Intangible Assets and Goodwill Goodwill and Intangible Assets, December 31, 2015 $ 78,492 $ 18,101 $ 96,593 Acquisition of trade names 5,159 — 5,159 Acquisition of customer relationships 8,878 — 8,878 Acquisition of other intangible assets 50 — 50 Foreign currency translation adjustment (11,400 ) (3,900 ) (15,300 ) Amortization (6,161 ) — (6,161 ) Goodwill and Intangible Assets, December 31, 2016 75,018 14,201 89,219 Acquisition of goodwill — 434 434 Acquisition of trade names 1,134 — 1,134 Acquisition of customer relationships 563 — 563 Foreign currency translation adjustment 2,823 1,137 3,960 Amortization (6,831 ) — (6,831 ) Goodwill and Intangible Assets, December 31, 2017 72,707 15,772 88,479 Acquisition of goodwill — 78,795 78,795 Acquisition of trade names 61,500 61,500 Acquisition of customer relationships 124,430 124,430 Acquisition of other intangible assets 5,367 — 5,367 Foreign currency translation adjustment (1,524 ) (672 ) (2,196 ) Amortization (15,323 ) — (15,323 ) Impairment of goodwill — (2,205 ) (2,205 ) Goodwill and Intangible Assets, December 31, 2018 $ 247,157 $ 91,690 $ 338,847 |
Weighted Average Amortization Periods for Finite Lived Intangible Assets | The weighted-average amortization periods for the Company’s finite-lived intangible assets as of December 31, 2018 are as follows: Years Trade names 15 Licenses 33 Customer relationships 14 Other 10 |
Estimated Amortization Expense | Estimated amortization expense for each of the five succeeding fiscal years is as follows (in thousands): Year ending December 31, 2019 $ 16,841 2020 16,827 2021 16,349 2022 16,349 2023 16,309 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principle Payments of Term Loan | As of December 31, 2018, the future principal payments of the Term Loan are as follows (in thousands): 2019 $ 2,750 2020 2,750 2021 2,750 2022 2,750 2023 2,750 Thereafter 259,188 Total $ 272,938 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Values of Derivative Financial Instruments Included in Unaudited Condensed Consolidated Balance Sheets | The fair values of the Company’s derivative financial instruments included in the consolidated balance sheets are presented as follows (in thousands): December 31, Derivatives designated as hedging instruments Balance Sheet Location 2018 2017 Interest rate swaps Prepaid expenses $ 42 $ 11 Other assets 157 — December 31, Derivatives not designated as hedging instruments Balance Sheet Location 2018 2017 Foreign exchange contracts Accrued Expenses $ — $ 1,951 |
Gains and Losses Related to Derivative Financial Instruments Designated as Hedging Instruments | The amounts of the gains and losses related to the Company’s derivative financial instruments designated as hedging instruments are recognized in other comprehensive income (loss) as follows (in thousands): Year ended December 31, Derivatives designated as hedging instruments 2018 2017 2016 Interest rate swaps $ 161 $ 17 $ 17 |
Gains and Losses Related to Derivative Financial Instruments Not Designated as Hedging Instruments | The amounts of the gains and losses related to the Company’s derivative financial instruments not designated as hedging instruments are recognized in earnings as follows (in thousands): Year Ended December 31, Derivatives not designated as hedging instruments Location of Gain or (Loss) 2018 2017 2016 Foreign exchange contracts Selling, general and administrative expense $ 150 $ (2,592) $ 2,182 |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cash Dividends Declared | Dividends were declared in 2018 and 2017 as follows: Dividend per share Date declared Date of record Payment date $0.0425 March 8, 2017 May 1, 2017 May 15, 2017 $0.0425 June 22, 2017 August 1, 2017 August 15, 2017 $0.0425 August 4, 2017 November 1, 2017 November 15, 2017 $0.0425 November 7, 2017 February 1, 2018 February 15, 2018 $0.0425 March 8, 2018 May 1, 2018 May 15, 2018 $0.0425 June 28, 2018 August 1, 2018 August 15, 2018 $0.0425 July 31, 2018 November 1, 2018 November 15, 2018 $0.0425 November 7, 2018 February 1, 2019 February 15, 2019 |
Summary of Stock Option Activity and Related Information | A summary of the Company’s stock option activity and related information for the three years ended December 31, 2018, is as follows: Options Weighted- average exercise price Weighted- average remaining contractual life (years) Aggregate intrinsic value Options outstanding at December 31, 2015 2,242,202 $ 14.28 Grants 66,850 15.44 Exercises (272,325 ) 9.01 Cancellations (30,750 ) 15.39 Expirations (230,577 ) 27.16 Options outstanding at December 31, 2016 1,775,400 13.44 Grants 125,750 17.38 Exercises (300,000 ) 11.34 Cancellations (45,700 ) 16.40 Expirations (99,250 ) 20.40 Options outstanding at December 31, 2017 1,456,200 13.64 Grants 205,750 13.56 Exercises (58,000 ) 4.93 Cancellations (22,375 ) 16.95 Expirations (32,750 ) 15.50 Options outstanding at December 31, 2018 1,548,825 13.87 4.2 $ 450,500 Options exercisable at December 31, 2018 1,279,825 $ 13.76 3.2 $ 450,500 |
Fair Value Stock Options at Grant Date using Weighted Average Assumption | The fair values for these stock options were estimated at the dates of grant using the following weighted-average assumptions: 2018 2017 2016 Historical volatility 34 % 39 % 39 % Expected term (years) 6.0 6.0 6.0 Risk-free interest rate 2.72 % 1.97 % 1.37 % Expected dividend yield 1.22 % 0.98 % 1.10 % |
Summary of Restricted Stock Activity | A summary of the Company’s restricted stock activity and related information for the three years ended December 31, 2018 is as follows: Restricted Shares Weighted- average grant date fair value Non-vested restricted shares, December 31, 2015 101,435 $ 14.77 Grants 109,170 15.64 Vested (46,306 ) 14.79 Cancellations (2,475 ) 14.93 Non-vested restricted shares, December 31, 2016 161,824 15.35 Grants 133,352 18.32 Vested (69,795 ) 15.39 Cancellations (6,064 ) 16.07 Non-vested restricted shares, December 31, 2017 219,317 17.12 Grants 223,884 13.25 Vested (90,926 ) 17.14 Cancellations (25,730 ) 14.96 Non-vested restricted shares, December 31, 2018 326,545 $ 14.63 Total unrecognized compensation expense remaining $ 3,482,300 Weighted-average years expected to be recognized over 1.6 |
Summary of Performance-based Award Activity | A summary of the Company’s performance-based award activity and related information for the three years ended December 31, 2018 is as follows: Performance - based awards (1) Weighted- average grant date fair value Non-vested performance -based awards, December 31, 2015 66,150 $ 14.84 Grants 82,000 15.69 Cancellations (2,188 ) 14.94 Non-vested performance -based awards, December 31, 2016 145,962 15.32 Grants 87,000 18.45 Cancellations (4,070 ) 16.52 Non-vested performance -based awards, December 31, 2017 228,892 16.49 Grants 182,300 12.81 Vested (58,888 ) 14.84 Cancellations (13,017 ) 15.95 Non-vested performance -based awards, December 31, 2018 339,287 $ 14.82 Total unrecognized compensation expense remaining $ 2,388,000 Weighted-average years expected to be recognized over 1.7 (1) Represents the target number of shares to be issued for each performance-based award. |
(LOSS) INCOME PER COMMON SHARE
(LOSS) INCOME PER COMMON SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Calculations of Basic and Diluted Income per Common Share | The calculations of basic and diluted (loss) income per common share for the years ended December 31, 2018, 2017 and 2016, are as follows: 2018 2017 2016 (in thousands - except per share amounts) Net (loss) income – Basic and Diluted $ (1,720 ) $ 2,154 $ 15,720 Weighted-average shares outstanding – Basic 19,452 14,505 14,174 Effect of dilutive securities: Stock options and other stock awards — 450 375 Weighted-average shares outstanding – Diluted 19,452 14,955 14,549 Basic (loss) income per common share $ (0.09 ) $ 0.15 $ 1.11 Diluted (loss) income per common share $ (0.09 ) $ 0.14 $ 1.08 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Components of Income before Income Taxes | The components of income before income taxes and equity in earnings are as follows: Year Ended December 31, 2018 2017 2016 (in thousands) Domestic $ 5,455 $ 17,728 $ 22,114 Foreign (4,946 ) (6,949 ) (112 ) Total income before income taxes and equity in earnings $ 509 $ 10,779 $ 22,002 |
Provision for Income Taxes | The provision for income taxes (before equity in earnings) consists of: Year Ended December 31, 2018 2017 2016 (in thousands) Current: Federal $ 775 $ 7,041 $ 8,000 State and local 351 957 498 Foreign (323 ) 4 483 Deferred 2,086 1,030 (1,951 ) Income tax provision $ 2,889 $ 9,032 $ 7,030 |
Significant Components of Deferred Income Tax Assets | Significant components of the Company’s deferred income tax assets and (liabilities) are as follows: December 31, 2018 2017 (in thousands) Deferred income tax assets: Deferred rent expense $ 3,504 $ 2,212 Stock options 2,982 2,903 Inventory 1,446 970 Operating loss and non-deductible interest carry-forward 7,071 4,114 Accounts receivable allowances 734 264 Accrued compensation 1,026 623 Depreciation and amortization — 247 Other 1,753 1,882 Total deferred income tax assets $ 18,516 $ 13,215 |
Significant Components of Net Deferred Income Tax Asset (Liability) | Deferred income tax liabilities: Fixed assets $ (2,540 ) $ — Intangibles (27,534 ) (8,732 ) Equity in earnings — (56 ) Total deferred income tax liabilities (30,074 ) (8,788 ) Net deferred income tax (liability) asset (11,558 ) 4,427 Valuation allowance (2,850 ) (3,024 ) Net deferred income tax (liability) asset $ (14,408 ) $ 1,403 |
Difference between Provision for Income Taxes and Amount Computed by Applying Federal Statutory Rates | The provision for income taxes (before equity in earnings) differs from the amounts computed by applying the applicable federal statutory rates as follows: Year Ended December 31, 2018 2017 2016 Provision for federal income taxes at the statutory rate 21.0 % 35.0 % 35.0 % Increases (decreases): State and local income taxes, net of Federal income tax benefit 97.4 6.1 3.6 Foreign rate differences (110.3 ) 7.2 (7.9 ) Non-deductible expenses 228.5 3.7 3.4 Tax Act- revaluation of net deferred tax assets and other 16.8 27.7 — Tax Act- transition tax 43.0 3.1 — Uncertain tax positions 302.8 0.6 — Research and development credit (18.5 ) — — Federal return to provision (27.5 ) — — Other 14.4 0.4 (2.1 ) Provision for income taxes 567.6 % 83.8 % 32.0 % |
Estimated Values of Gross Uncertain Tax Positions | The estimated values of the Company’s gross uncertain tax positions at December 31, 2018, 2017 and 2016 are liabilities of $2.0 million, $161,000 and $109,000, respectively, and consist of the following: Year Ended December 31, 2018 2017 2016 (in thousands) Balance at January 1 $ (161 ) $ (109 ) $ (157 ) Additions based on tax positions related to the current year (626 ) (82 ) — Additions based on tax positions related to the prior year (1,302 ) — — Reductions for tax position of prior years 114 30 — Settlements — — 48 Balance at December 31 $ (1,975 ) $ (161 ) $ (109 ) |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting Information | The Company has segmented its operations to reflect the manner in which management reviews and evaluates the results of its operations. The U.S. segment includes the Company’s primary domestic business that designs, markets and distributes its products to retailers, distributors and its internet websites. The International Segment consists of certain business operations conducted outside the U.S. Management evaluates the performance of the U.S. and International 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 fees and consulting fees, are not allocated to the specific segments and are reflected as unallocated corporate expenses. Year Ended December 31, 2018 2017 2016 (in thousands) Net sales: U.S. $ 611,973 $ 481,719 $ 491,549 International 92,569 97,757 101,070 Total net sales $ 704,542 $ 579,476 $ 592,619 Income from operations: U.S. (1) $ 44,213 $ 39,341 $ 40,515 International (2) (5,395 ) (6,984 ) 3,052 Unallocated corporate expenses (20,239 ) (17,177 ) (16,490 ) Total income from operations $ 18,579 $ 15,180 $ 27,077 Depreciation and amortization: U.S. (3) $ 18,840 $ 10,004 $ 10,231 International 4,489 4,185 3,917 Total depreciation and amortization $ 23,329 $ 14,189 $ 14,148 Capital expenditures: U.S. $ 7,746 $ 4,176 $ 2,956 International 156 2,135 424 Total capital expenditures $ 7,902 $ 6,311 $ 3,380 (1) In 2018 and 2016, income from operations for the U.S. segment includes $2.1 million and $2.4 million, respectively, of restructuring expenses related to the Filament integration and the U.S. restructuring plan, respectively, as described in Note A – Significant Accounting Policies. The 2016 period also includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. (2) In 2018 and 2017 income from operations for the International segment includes $1.0 million of restructuring expenses related to the integration of entities in Europe, as described in Note A – Significant Accounting Policies. (3) The 2016 period includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. December 2018 2017 (in thousands) Assets: U.S. $ 604,532 $ 282,011 International 94,210 105,984 Unallocated/ corporate/ other 9,830 13,526 Total assets $ 708,572 $ 401,521 Year Ended December 2018 2017 (in thousands) Goodwill: U.S. Beginning balance $ 2,846 $ 2,412 Acquisition activity 78,795 434 Ending balance 81,641 2,846 International Beginning balance 12,926 11,789 Foreign currency translation adjustment (672 ) 1,137 Impairment (2,205 ) — Ending balance 10,049 12,926 Total goodwill $ 91,690 $ 15,772 |
Net Sales and Long-Lived Assets by Major Geographic Locations | The following table sets forth long-lived assets by the major geographic locations: December, 2018 2017 (in thousands) Long-lived assets, excluding intangible assets, at period-end: United States $ 47,812 $ 45,285 United Kingdom 1,896 2,779 Rest of World 480 729 Total $ 50,188 $ 48,793 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Future Minimum Payments Under Non Cancelable Operating Leases | Future minimum payments under non-cancelable operating leases are as follows (in thousands): Year Ending December 31 , 2019 $ 16,238 2020 14,898 2021 14,498 2022 14,744 2023 14,589 Thereafter 62,698 Total $ 137,665 |
Future Minimum Royalties Payable | Future minimum royalties payable under these agreements are as follows (in thousands): Year ending December 31 , 2019 $ 7,927 2020 8,485 2021 8,942 2022 926 2023 156 Thereafter — Total $ 26,436 |
RETIREMENT PLANS (Tables)
RETIREMENT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Future Benefit Payments | Expected benefit payments for each of the next five fiscal years and in the aggregate for the five fiscal years thereafter are as follows (in thousands): Year ending December 31, 2019 $ 421 2020 407 2021 404 2022 449 2023 433 2024 through 2028 1,937 |
OTHER (Tables)
OTHER (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Components of Inventory | The components of inventory are as follows: December 31, 2018 2017 (in thousands) Finished goods $ 165,969 $ 125,355 Work in process 375 86 Raw materials 7,257 6,995 Total $ 173,601 $ 132,436 |
Property and Equipment | Property and equipment consist of: December 31, 2018 2017 (in thousands) Machinery, furniture and equipment $ 106,525 $ 91,282 Leasehold improvements 29,803 32,591 Building and improvements 770 787 Construction in progress 1,032 3,122 Land 100 100 138,230 127,882 Less: accumulated depreciation and amortization (112,468 ) (104,817 ) Total $ 25,762 $ 23,065 |
Accrued Expenses | Accrued expenses consist of: December 31, 2018 2017 (in thousands) Customer allowances and rebates $ 12,184 $ 11,662 Compensation and benefits 9,065 9,613 Interest 243 191 Vendor invoices 3,487 4,027 Royalties 1,916 1,744 Commissions 1,557 786 Freight 4,160 4,002 Professional fees 2,473 3,160 VAT 79 1,176 Foreign exchange contracts — 1,951 Restructuring 1,557 — Other 8,735 5,809 Total $ 45,456 $ 44,121 |
Deferred Rent Other Long Term Liabilities | Deferred rent & other long-term liabilities consist of: December 31, 2018 2017 (in thousands) Deferred rent liability $ 13,832 $ 13,399 Retirement benefit obligations 6,169 6,829 Non-income tax liability 1,860 — Royalty obligation 1,324 — Other long term obligations 154 21 Total $ 23,339 $ 20,249 |
Supplemental Cash Flow Information | Supplemental cash flow information Year Ended December 31, 2018 2017 2016 (in thousands) Supplemental disclosure of cash flow information: Cash paid for interest $ 16,319 $ 3,791 $ 4,171 Cash paid for taxes 2,599 12,936 6,384 Non-cash investing activities: Translation adjustment $ (5,906 ) $ 7,823 $ (23,061 ) |
Components of Accumulated Other Comprehensive Loss, Net | Components of accumulated other comprehensive loss, net Year Ended December 31, 2018 2017 2016 (in thousands) Accumulated translation adjustment: Balance at beginning of year $ (27,821 ) $ (35,644 ) $ (12,961 ) Translation adjustment during period (5,906 ) 7,823 (23,061 ) Amounts reclassified from accumulated other comprehensive loss: (1) Currency translation adjustment — — 378 Balance at end of year $ (33,727 ) $ (27,821 ) $ (35,644 ) Accumulated deferred gains (losses) on cash flow hedges: Balance at beginning of year $ 14 $ (3 ) $ (20 ) Amounts reclassified from accumulated other comprehensive loss: (2) Settlement of cash flow hedge (14 ) — — Derivative fair value adjustment, net of tax 161 17 17 Balance at end of year $ 161 $ 14 $ (3 ) Accumulated effect of retirement benefit obligations: Balance at beginning of year $ (1,518 ) $ (1,352 ) $ (1,204 ) Net gain (loss) arising from retirement benefit obligations, net of tax 373 (228 ) (202 ) Amounts reclassified from accumulated other comprehensive loss: Amortization of loss, net of tax (3) 95 62 54 Balance at end of year $ (1,050 ) $ (1,518 ) $ (1,352 ) (1) Amount is recorded in equity in earnings (losses) on the consolidated statements of operations. (2) Amounts reclassified are recorded in interest expense on the consolidated statement of operations. (3) Amount is recorded in selling, general and administrative expenses on the consolidated statements of operations. |
Significant Accounting Polici_3
Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule Of Significant Accounting Policies [Line Items] | ||||
Foreign currency gain/loss | $ 0.5 | $ 3,000,000 | $ 4,200,000 | |
Freight-out expenses | 14,500,000 | 11,500,000 | 11,000,000 | |
Advertising expenses | 4,400,000 | 3,400,000 | 3,700,000 | |
Restructuring expenses | 2,324,000 | $ 1,024,000 | $ 2,420,000 | |
Restructuring Charges [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Accounts Payable and Accrued Liabilities, Current | 0.2 | |||
Scenario, Forecast [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Restructuring expenses | $ 1,500,000 | |||
Adjustments for New Accounting Pronouncement [Member] | Liability [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Adoption of accounting standards increase in assets and liabilities | 104,500,000 | |||
Adjustments for New Accounting Pronouncement [Member] | Assets [Member] | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Adoption of accounting standards increase in assets and liabilities | 91,000,000 | |||
Employee severance | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Restructuring expenses | 2,100,000 | |||
Restructuring Reserve | $ 1,400,000 | |||
Performance Shares | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Vesting period | 3 years | |||
Number of shares range percentage | 150.00% | |||
Wal-Mart Stores Inc | Net sales | Credit Concentration Risk | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Percentage of net sales | 14.00% | 15.00% | 16.00% | |
Costco Wholesale Corporation | Net sales | Credit Concentration Risk | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Percentage of net sales | 10.00% | |||
Building and Improvements | Minimum | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Property and equipment depreciated over estimated useful lives | 30 years | |||
Machinery, Furniture and Equipment | Minimum | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Property and equipment depreciated over estimated useful lives | 3 years | |||
Machinery, Furniture and Equipment | Maximum | ||||
Schedule Of Significant Accounting Policies [Line Items] | ||||
Property and equipment depreciated over estimated useful lives | 10 years |
Revenue - Additional Informatio
Revenue - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||
Shipping and handling revenue | $ 704,542 | $ 579,476 | $ 592,619 |
Shipping and Handling [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Shipping and handling revenue | $ 3,500 | $ 2,700 | $ 2,600 |
Summary of Company's Revenue Di
Summary of Company's Revenue Disaggregated by Geographic Region and Revenue (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disaggregation of Revenue [Line Items] | |||
Net Sales | $ 704,542 | $ 579,476 | $ 592,619 |
United States | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 575,158 | 460,788 | 472,962 |
United Kingdom | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 65,852 | 74,834 | 74,991 |
Rest of World | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 63,532 | 43,854 | 44,666 |
U.S. segment | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 611,973 | 481,719 | 491,549 |
U.S. segment | Kitchenware | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 331,603 | 276,745 | 287,100 |
U.S. segment | Tableware | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 169,709 | 152,846 | 155,961 |
U.S. segment | Home Solutions | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 110,661 | 52,128 | 48,488 |
International segment | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 92,569 | 97,757 | 101,070 |
International segment | Kitchenware | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | 58,164 | 59,686 | 59,742 |
International segment | Tableware | |||
Disaggregation of Revenue [Line Items] | |||
Net Sales | $ 34,405 | $ 38,071 | $ 41,328 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 02, 2018 | Aug. 31, 2017 | Oct. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||||||||
Goodwill | $ 91,690 | $ 91,690 | $ 15,772 | $ 14,201 | $ 18,101 | ||||
Selling, General and Administrative Expenses [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Contingent Consideration Obligation Acquired | 1,800 | ||||||||
Fitz and Floyd Business | |||||||||
Business Acquisition [Line Items] | |||||||||
Business acquisition cash paid | $ 9,100 | ||||||||
Net sales | $ 7,700 | ||||||||
Goodwill and other intangibles | 2,131 | ||||||||
Goodwill | 400 | ||||||||
Inventory | 5,424 | ||||||||
Fitz and Floyd Business | Customer Relationships and Trade Names | |||||||||
Business Acquisition [Line Items] | |||||||||
Estimated fair value of intangible assets acquired | $ 1,700 | ||||||||
Amco Houseworks, Chicago Metallic and Swing-A-Way kitchenware and bakeware brands | |||||||||
Business Acquisition [Line Items] | |||||||||
Business acquisition cash paid | $ 8,800 | ||||||||
Inventory | 3,500 | ||||||||
Amco Houseworks, Chicago Metallic and Swing-A-Way kitchenware and bakeware brands | Customer Relationships and Trade Names | |||||||||
Business Acquisition [Line Items] | |||||||||
Estimated fair value of intangible assets acquired | $ 5,300 | ||||||||
Intangible assets acquired, estimated useful life | 15 years | ||||||||
Focus Products Group International, LLC | |||||||||
Business Acquisition [Line Items] | |||||||||
Net sales | 3,600 | ||||||||
Copco Product Line | |||||||||
Business Acquisition [Line Items] | |||||||||
Business acquisition cash paid | $ 12,300 | ||||||||
Net sales | 3,900 | ||||||||
Inventory | 3,900 | ||||||||
Copco Product Line | Customer Relationships | |||||||||
Business Acquisition [Line Items] | |||||||||
Estimated fair value of intangible assets acquired | $ 8,400 | ||||||||
Intangible assets acquired, estimated useful life | 15 years | ||||||||
Copco Product Line | Trade Names | |||||||||
Business Acquisition [Line Items] | |||||||||
Intangible assets acquired, estimated useful life | 10 years | ||||||||
Filament | |||||||||
Business Acquisition [Line Items] | |||||||||
Business acquisition cash paid | $ 217,511 | ||||||||
Net sales | $ 128,800 | ||||||||
Goodwill and other intangibles | 269,454 | ||||||||
Inventory | 29,444 | ||||||||
Business Acquisition, Date of Acquisition Agreement | Dec. 22, 2017 | ||||||||
Business Acquisition, Effective Date of Acquisition | Mar. 2, 2018 | ||||||||
Aggregate acquisition agreement amount | $ 294,416 | ||||||||
Business acquisition, equity interest issued or issuable, number of shares | 5,593,116 | ||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 76,905 | ||||||||
Increase or decrease in goodwill | $ 10,100 |
Summary of Purchase Price (Deta
Summary of Purchase Price (Detail) - Filament $ in Thousands | Mar. 02, 2018USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 217,511 |
Share consideration | 76,905 |
Total purchase price | $ 294,416 |
Summary of Purchase Price Alloc
Summary of Purchase Price Allocated Based on Estimated Fair Value of Assets and Liabilities (Detail) - USD ($) $ in Thousands | Mar. 02, 2018 | Aug. 31, 2017 |
Filament | ||
Business Acquisition [Line Items] | ||
Accounts receivable | $ 26,224 | |
Inventory | 29,444 | |
Other assets | 5,620 | |
Other liabilities | (22,449) | |
Deferred income tax | (13,877) | |
Goodwill and other intangibles | 269,454 | |
Total allocated value | $ 294,416 | |
Fitz and Floyd Business | ||
Business Acquisition [Line Items] | ||
Accounts receivable | $ 3,115 | |
Inventory | 5,424 | |
Other assets | 458 | |
Other liabilities | (2,056) | |
Goodwill and other intangibles | 2,131 | |
Total allocated value | $ 9,072 |
Summary of Pro Forma Consolidat
Summary of Pro Forma Consolidated Net Sales and Income (Loss) Before Income Taxes and Equity in Earnings (Detail) - Filament - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | ||
Net sales | $ 730,353 | $ 747,549 |
Income before income taxes and equity in earnings | 2,439 | 14,151 |
Net (loss) income | $ (267) | $ 5,794 |
Diluted (loss) income per common share | $ (0.01) | $ 0.28 |
Sale of Accounts Receivable - A
Sale of Accounts Receivable - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
HSBC Bank [Member] | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Sale of receivables | $ 18,000,000 | $ 16,400,000 | |
Receivables purchase agreement | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Receivables purchase agreement - description of arrangements | The term of the agreement is for 364 days and shall automatically be extended for annual successive terms unless terminated. Either party may terminate the agreement at any time upon sixty days’ prior written notice to the other party. | ||
Agreement period | 364 days | ||
Agreement period, extension term | automatically be extended for annual successive terms unless terminated | ||
Agreement termination, written notice period | 60 days | ||
Sale of receivables | $ 86,000,000 | 90,200,000 | |
Receivables purchase agreement | Selling, general and administrative expenses | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Charge related to sale of receivables | $ 453,000 | $ 328,000 | |
Receivables purchase agreement | Maximum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Receivables purchase agreement - maximum borrowing | $ 25,000,000 |
Equity Investments - Additional
Equity Investments - Additional Information (Detail) R$ in Millions | 12 Months Ended | ||||
Dec. 31, 2018USD ($)$ / $ | Dec. 31, 2017USD ($)$ / $ | Dec. 31, 2016USD ($)$ / $ | Dec. 31, 2016BRL (R$)$ / $ | Feb. 09, 2012USD ($) | |
Schedule of Equity Method Investments [Line Items] | |||||
Equity in earnings (losses), net of taxes | $ 660,000 | $ 407,000 | $ 748,000 | ||
Currency translation losses recognized upon the sales of equity interest | $ (378,000) | ||||
Asset impairment charges | $ 200,000 | ||||
GS Internacional S/A | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity interest, percentage sold | 40.00% | 40.00% | |||
Currency translation losses recognized upon the sales of equity interest | $ 378,000 | ||||
Sales proceeds from disposal of equity method investment | 567,000 | R$ 2.3 | |||
Gain on disposal of equity method investment | 189,000 | ||||
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 | $ / $ | 19.64 | 19.68 | |||
Increase (Decrease) in equity method investment | $ 1,900,000 | $ 1,000,000 | |||
Cash dividend received | 115,000 | 28,000 | 205,000 | ||
Equity in earnings (losses), net of taxes | 900,000 | 400,000 | 600,000 | ||
Equity in earnings, deferred taxes | 100,000 | 200,000 | $ 500,000 | ||
Fair value of investment | 31,900,000 | ||||
Carrying value of investment | 22,600,000 | ||||
Grupo Vasconia S.A.B. | Prepaid expenses and other current assets | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Due from related party | $ 95,000 | $ 64,000 | |||
Grupo Vasconia S.A.B. | Transaction 02 | Minimum | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Average daily exchange rate for period - MXN to USD | $ / $ | 18.71 | 17.81 | 18.02 | 18.02 | |
Grupo Vasconia S.A.B. | Transaction 02 | Maximum | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Average daily exchange rate for period - MXN to USD | $ / $ | 19.81 | 20.30 | 19.85 | 19.85 | |
Grand Venture | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Percentage of ownership in equity method investment | 50.00% | ||||
Carrying value of investment | $ 0 | $ 228,000 | |||
Payment for equity method investment | $ 500,000 |
Summarized Statement of Income
Summarized Statement of Income Information for Vasconia in USD and MXN (Detail) - Grupo Vasconia S.A.B. $ in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018USD ($) | Dec. 31, 2018MXN ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017MXN ($) | Dec. 31, 2016USD ($) | Dec. 31, 2016MXN ($) | |
Income Statement [Abstract] | ||||||
Net sales | $ 179,547 | $ 3,456,852 | $ 167,283 | $ 3,157,671 | $ 149,533 | $ 2,795,009 |
Gross profit | 36,891 | 711,941 | 34,626 | 655,186 | 27,205 | 510,617 |
Income from operations | 11,402 | 222,115 | 10,475 | 199,170 | 5,611 | 105,334 |
Net income | $ 2,887 | $ 57,590 | $ 1,164 | $ 23,983 | $ 3,491 | $ 68,230 |
Summarized Balance Sheet Inform
Summarized Balance Sheet Information for Vasconia in USD and MXN (Detail) - Grupo Vasconia S.A.B. $ in Thousands, $ in Thousands | Dec. 31, 2018USD ($) | Dec. 31, 2018MXN ($) | Dec. 31, 2017USD ($) | Dec. 31, 2017MXN ($) |
Balance Sheet | ||||
Current assets | $ 96,135 | $ 1,888,602 | $ 91,157 | $ 1,793,832 |
Non-current assets | 86,279 | 1,694,969 | 87,900 | 1,729,745 |
Current liabilities | 64,831 | 1,273,619 | 50,766 | 998,993 |
Non-current liabilities | $ 32,261 | $ 633,772 | $ 39,147 | $ 770,352 |
Components of Intangible Assets
Components of Intangible Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Intangible Assets Disclosure [Line Items] | ||||
Goodwill, Gross | $ 93,895 | $ 15,772 | ||
Goodwill, Accumulated Amortization | (2,205) | |||
Goodwill, Net | 91,690 | 15,772 | $ 14,201 | $ 18,101 |
Indefinite-Lived Trade Names, Gross | 58,216 | 7,616 | ||
Indefinite-Lived Trade Names, Net | 58,216 | 7,616 | ||
Finite-Lived Intangible Assets, Gross | 126,729 | |||
Intangible Assets, Gross (Including Goodwill) | 393,639 | |||
Finite-Lived Intangible Assets, Accumulated Amortization | (52,587) | (38,250) | ||
Goodwill, Accumulated Impairment | (2,205) | |||
Intangible Assets, Net (Including Goodwill) | 338,847 | 88,479 | $ 89,219 | $ 96,593 |
License | ||||
Schedule of Intangible Assets Disclosure [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | 15,847 | 15,847 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (9,825) | (9,375) | ||
Finite-Lived Intangible Assets, Net | 6,022 | 6,472 | ||
Trade Names | ||||
Schedule of Intangible Assets Disclosure [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | 43,689 | 33,368 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (13,965) | (11,109) | ||
Finite-Lived Intangible Assets, Net | 29,724 | 22,259 | ||
Customer Relationships | ||||
Schedule of Intangible Assets Disclosure [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | 175,482 | 52,961 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (27,538) | (16,966) | ||
Finite-Lived Intangible Assets, Net | 147,944 | 35,995 | ||
Other | ||||
Schedule of Intangible Assets Disclosure [Line Items] | ||||
Finite-Lived Intangible Assets, Gross | 6,510 | 1,165 | ||
Finite-Lived Intangible Assets, Accumulated Amortization | (1,259) | (800) | ||
Finite-Lived Intangible Assets, Net | $ 5,251 | $ 365 |
Intangible Assets (Detail)
Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible Assets | |||
Intangible Assets, Beginning Balance | $ 72,707 | $ 75,018 | $ 78,492 |
Goodwill and intangible assets, Beginning Balance | 88,479 | 89,219 | 96,593 |
Acquisition of goodwill | 78,795 | 434 | |
Foreign currency translation adjustment | (2,196) | 3,960 | (15,300) |
Amortization | (15,323) | (6,831) | (6,161) |
Impairment of goodwill | 2,205 | ||
Goodwill and Intangible Assets, Ending Balance | 338,847 | 88,479 | 89,219 |
Foreign currency translation adjustment | (1,524) | 2,823 | (11,400) |
Amortization | (15,323) | (6,831) | (6,161) |
Intangible Assets, Ending Balance | 247,157 | 72,707 | 75,018 |
Goodwill | |||
Beginning balance | 15,772 | 14,201 | 18,101 |
Acquisition of goodwill | 78,795 | 434 | |
Foreign currency translation adjustment | (672) | 1,137 | (3,900) |
Impairment | (2,205) | ||
Ending balance | 91,690 | 15,772 | 14,201 |
Trade Names | |||
Intangible Assets | |||
Acquisition of Intangible Assets | 61,500 | 1,134 | 5,159 |
Acquisition of customer relationships | 61,500 | 1,134 | 5,159 |
Customer Relationships | |||
Intangible Assets | |||
Acquisition of Intangible Assets | 124,430 | 563 | 8,878 |
Acquisition of customer relationships | 124,430 | $ 563 | 8,878 |
Other | |||
Intangible Assets | |||
Acquisition of Intangible Assets | 5,367 | 50 | |
Acquisition of customer relationships | $ 5,367 | $ 50 |
Weighted Average Amortization P
Weighted Average Amortization Period for Finite Lived Intangible Assets (Detail) | 12 Months Ended |
Dec. 31, 2018 | |
Trade Names | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, weighted-average amortization periods | 15 years |
License | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, weighted-average amortization periods | 33 years |
Customer Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, weighted-average amortization periods | 14 years |
Other | |
Finite-Lived Intangible Assets [Line Items] | |
Finite-lived intangible assets, weighted-average amortization periods | 10 years |
Estimated Amortization Expense
Estimated Amortization Expense (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Schedule Of Estimated Future Amortization Expense [Line Items] | |
2019 | $ 16,841 |
2020 | 16,827 |
2021 | 16,349 |
2022 | 16,349 |
2023 | $ 16,309 |
Goodwill And Intangible Asset_2
Goodwill And Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 01, 2018 | Dec. 31, 2015 | |
Schedule of Intangible Assets Disclosure [Line Items] | |||||
Amortization expenses | $ 15,323 | $ 6,831 | $ 6,161 | ||
Goodwill impairment charges | $ 2,205 | ||||
Reporting Unit Percentage Of Carrying Value In Excess Of Fair Value | 12.00% | ||||
Goodwill | $ 91,690 | $ 15,772 | $ 14,201 | $ 18,101 | |
European Kitchenware [Member] | |||||
Schedule of Intangible Assets Disclosure [Line Items] | |||||
Goodwill | $ 10,000 | ||||
Goodwill, percentage of fair value in excess of the carrying value | 7.00% | ||||
US Reporting Unit [Member] | |||||
Schedule of Intangible Assets Disclosure [Line Items] | |||||
Goodwill | $ 81,600 | ||||
Goodwill, percentage of fair value in excess of the carrying value | 9.00% |
Schedule of Future Principle Pa
Schedule of Future Principle Payments of Term Loan (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Debt Disclosure [Abstract] | |
2019 | $ 2,750 |
2020 | 2,750 |
2021 | 2,750 |
2022 | 2,750 |
2023 | 2,750 |
Thereafter | 259,188 |
Total | $ 272,938 |
Debt - Additional Information (
Debt - Additional Information (Detail) ¥ in Millions | 12 Months Ended | |||
Dec. 31, 2018USD ($) | Dec. 31, 2018CNY (¥) | Mar. 02, 2018USD ($) | Dec. 31, 2017USD ($) | |
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 150,000,000 | |||
Unamortized debt issuance costs | $ 7,500,000 | |||
Interest rates on outstanding borrowings | 6.00% | 6.00% | ||
Minimum availability under revolving credit to maintain minimum fixed charge ratio for four consecutive months | $ 15,000,000 | |||
Debt instrument, quarterly repayment percentage of principal | 0.25% | |||
Maximum Debt Instrument Leverage Ratio | 3.75 | |||
Debt instrument, basis spread on variable rate | 1.00% | |||
Line of credit facility, description | The Incremental Facilities may not exceed the sum of (i) $50.0 million, plus (ii) an unlimited amount so long as, in the case of (ii) only, the Company's secured net leverage ratio, as defined in and computed pursuant to the Term Loan, is no greater than 3.75 to 1.00 subject to certain limitations and for the period defined pursuant to the Term Loan. | |||
Line of credit facility description | The Term Loan bears interest, at the Company’s option, at one of the following rates: (i) an alternate base rate, defined, for any day, as the greater of the prime rate, a federal funds and overnight bank funding based rate, plus 0.5% or one-month LIBOR (at the Company’s option), plus 1.0%, plus a margin of 2.50% or (ii) LIBOR plus a margin of 3.50%. | |||
Unamortized debt issuance costs- short term | $ 1,500,000 | |||
Outstanding borrowings under term loan | 272,938,000 | |||
ABL Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | 150,000,000 | |||
Outstanding borrowing under credit facility | 42,100,000 | |||
Open letters of credit | 3,400,000 | |||
Availability under revolving credit facility | $ 104,500,000 | |||
Credit facility, maximum borrowing capacity terms | The borrowing capacity under the ABL Agreement will depend, in part, on eligible levels of accounts receivable and inventory that fluctuate regularly. Consequently, the $150.0 million commitment thereunder may not represent actual borrowing capacity at any given time. | |||
Line of credit facility description | Borrowings under the revolving credit facility bear interest, at the Company's option, at one of the following rates: (i) an alternate base rate, defined, for any day, as the greater of the prime rate, a federal funds and overnight bank funding based rate plus 0.5% or one-month LIBOR, plus 1.0%, plus a margin of 0.25% to 0.75%, or (ii) LIBOR plus a margin of 1.25% to 1.75%. The respective margins are based upon the Company's total leverage ratio, as defined in and computed pursuant to the ABL Agreement. | |||
Debt Agreements | ||||
Debt Instrument [Line Items] | ||||
Percentage of capital stock of foreign subsidiaries pledged as collateral | 65.00% | 65.00% | ||
Credit facility terms | The Debt Agreements provide for customary restrictions and events of default. Restrictions include limitations on additional indebtedness, acquisitions, investments and payment of dividends, among other things. Further, the ABL Agreement provides that during any period (a) commencing on the last day of the most recently-ended four consecutive fiscal quarters on or prior to the date that availability under the ABL Agreement is less than the greater of $15.0 million or 10% of the aggregate commitment under the ABL Agreement at any time and (b) ending on the day after such availability has exceeded the greater of $15.0 million or 10% of the aggregate commitment under the ABL Agreement for forty-five (45) consecutive days, the Company is required to maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 as of the last day of any period of four consecutive fiscal quarters. | |||
Commitment Fee Percentage | 10.00% | |||
Term Loan | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 275,000,000 | |||
Term Loan | One-month LIBOR | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1.00% | |||
Term Loan | Alternate Base Rate | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 2.50% | |||
Term Loan | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 3.50% | |||
Term Loan | Prime rate, federal funds and overnight bank funding based rate | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.50% | |||
Revolving Credit Facility | Minimum | ABL Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Interest rates on outstanding borrowings | 2.40% | 2.40% | ||
Percentage of line of credit facility unused capacity commitment fee | 0.375% | |||
Revolving Credit Facility | Minimum | ABL Credit Agreement | Alternate Base Rate | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.25% | |||
Revolving Credit Facility | Minimum | ABL Credit Agreement | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1.25% | |||
Revolving Credit Facility | Maximum | ABL Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Interest rates on outstanding borrowings | 6.25% | 6.25% | ||
Revolving Credit Facility | Maximum | ABL Credit Agreement | Alternate Base Rate | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 0.75% | |||
Revolving Credit Facility | Maximum | ABL Credit Agreement | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate | 1.75% | |||
HSBC Facility | ||||
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 2,800,000 | ¥ 18 | ||
Outstanding borrowing under credit facility | ¥ 0.5 | $ 69,000 | ||
Senior Secured Asset Based Revolving Credit Facilities | ABL Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility maximum borrowing capacity if certain conditions are met | 200,000,000 | |||
Increase in line of credit facility | 50,000,000 | |||
Former Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Outstanding borrowing under credit facility | 94,700,000 | |||
Open letters of credit | 3,200,000 | |||
Availability under revolving credit facility | $ 58,000,000 | |||
Write off of debt issuance cost | $ 66,000 |
Derivatives - Additional Inform
Derivatives - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2018 | |
Derivative [Line Items] | ||||
Commencement date | 2018-04 | |||
Expiration date | Mar. 30, 2023 | |||
Interest Expense | $ 18,004 | $ 4,291 | $ 4,803 | |
Interest Rate Swap | ||||
Derivative [Line Items] | ||||
Interest Expense | 400 | |||
Designated as Hedging Instrument | Cash Flow Hedging | Interest Rate Contract | ||||
Derivative [Line Items] | ||||
Notional amount | 125,000 | $ 5,300 | ||
Not Designated as Hedging Instrument | Foreign exchange contract | ||||
Derivative [Line Items] | ||||
Notional amount | $ 0 | $ 34,900 |
Fair Values of Derivative Finan
Fair Values of Derivative Financial Instruments Included in Consolidated Balance Sheets (Detail) - Fair Value, Observable inputs, Level 2 - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Designated as Hedging Instrument | Interest Rate Contract | Prepaid expenses | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Assets | $ 42 | $ 11 |
Designated as Hedging Instrument | Interest Rate Contract | Other assets | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Assets | 157 | |
Not Designated as Hedging Instrument | Foreign exchange contract | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Liabilities | $ 0 | $ 1,951 |
Gains and Losses Related to Der
Gains and Losses Related to Derivative Financial Instruments Designated as Hedging Instruments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Designated as Hedging Instrument | Interest Rate Contract | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (Loss) recognized in OCI | $ 161 | $ 17 | $ 17 |
Gains and Losses Related to D_2
Gains and Losses Related to Derivative Financial Instruments Not Designated as Hedging Instruments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Not Designated as Hedging Instrument | Foreign exchange contract | Selling, general and administrative expenses | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of Gain or (Loss) Recognized in Income on Derivative | $ 150 | $ 2,592 | $ 2,182 |
Cash Dividends Declared (Detail
Cash Dividends Declared (Detail) - $ / shares | Mar. 12, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.17 | $ 0.17 | $ 0.17 | |
Date declared | May 15, 2019 | |||
Dividend Payment 1st | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Mar. 8, 2017 | |||
Date of record | May 1, 2017 | |||
Payment date | May 15, 2017 | |||
Dividend Payment 2nd | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Jun. 22, 2017 | |||
Date of record | Aug. 1, 2017 | |||
Payment date | Aug. 15, 2017 | |||
Dividend Payment 3rd | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Aug. 4, 2017 | |||
Date of record | Nov. 1, 2017 | |||
Payment date | Nov. 15, 2017 | |||
Dividend Payment 4th | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Nov. 7, 2017 | |||
Date of record | Feb. 1, 2018 | |||
Payment date | Feb. 15, 2018 | |||
Dividend Payment 5th | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Mar. 8, 2018 | |||
Date of record | May 1, 2018 | |||
Payment date | May 15, 2018 | |||
Dividend Payment 6th | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Jun. 28, 2018 | |||
Date of record | Aug. 1, 2018 | |||
Payment date | Aug. 15, 2018 | |||
Dividend Payment 7th | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Jul. 31, 2018 | |||
Date of record | Nov. 1, 2018 | |||
Payment date | Nov. 15, 2018 | |||
Dividend Payment 8th | ||||
Dividends Payable [Line Items] | ||||
Dividend per share | $ 0.0425 | |||
Date declared | Nov. 7, 2018 | |||
Date of record | Feb. 1, 2019 | |||
Payment date | Feb. 15, 2019 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Detail) - USD ($) | Mar. 12, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Apr. 30, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Dividend declaration date | May 15, 2019 | ||||||
Quarterly dividend declared | $ 0.17 | $ 0.17 | $ 0.17 | ||||
Stock repurchase program, authorized amount | $ 10,000,000 | ||||||
Treasury Stock Repurchase (in shares) | 0 | 0 | 0 | ||||
Total intrinsic value of stock options exercised | $ 361,000 | $ 2,071,000 | $ 1,848,000 | ||||
Unrecognized stock option compensation cost | $ 1,000,000 | ||||||
Weighted-average per share grant date fair value of stock options granted | $ 4.47 | $ 6.37 | $ 5.43 | ||||
Stock compensation expense | $ 4,135,000 | $ 3,390,000 | $ 2,942,000 | ||||
Stock compensation expense, stock option | 700,000 | 1,100,000 | 1,400,000 | ||||
Stock compensation expense, Performance based and restricted share | $ 3,400,000 | $ 2,300,000 | 1,500,000 | ||||
Stock compensation expense, stock awards granted | $ 32,000 | ||||||
Preferred stock Series A | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Preferred stock, shares authorized | 100 | 100 | |||||
Preferred stock, issued | 0 | 0 | |||||
Preferred stock, outstanding | 0 | 0 | |||||
Preferred stock Series B | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | |||||
Preferred stock, issued | 0 | 0 | |||||
Preferred stock, outstanding | 0 | 0 | |||||
Long Term Incentive Plan 2000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares available for grant | 946,109 | ||||||
Share based compensation arrangement by share based payment award, number of shares available for grant increase (decrease) | 900,000 | ||||||
Long Term Incentive Plan 2000 | After Amendment | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares available for grant | 6,187,500 | ||||||
Stock Options | Minimum | Long Term Incentive Plan 2000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Options expiration period | 5 years | ||||||
Stock Options | Maximum | Long Term Incentive Plan 2000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Options expiration period | 10 years | ||||||
Vesting period | 4 years | ||||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted-average recognition period | 1 year 7 months 6 days | ||||||
Total fair value of restricted stock vested | $ 1,100,000 | ||||||
Number of shares vested | 90,926 | 69,795 | 46,306 | ||||
Restricted Stock | Maximum | Long Term Incentive Plan 2000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 4 years | ||||||
Performance Shares | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Weighted-average recognition period | [1] | 1 year 8 months 12 days | |||||
Total fair value of restricted stock vested | $ 792,000 | ||||||
Number of shares range percentage | 150.00% | ||||||
Number of shares vested | [1] | 58,888 | |||||
Performance Shares | Long Term Incentive Plan 2000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Performance Shares | Subsequent Event | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares vested | 66,761 | ||||||
Dividend Declared | Subsequent Event | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Quarterly dividend declared | $ 0.0425 | ||||||
Dividend declared, date of record | May 1, 2019 | ||||||
[1] | Represents the target number of shares to be issued for each performance-based award. |
Summary of Stock Option (Detail
Summary of Stock Option (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Options | |||
Beginning balance | 1,456,200 | 1,775,400 | 2,242,202 |
Grants | 205,750 | 125,750 | 66,850 |
Exercises | (58,000) | (300,000) | (272,325) |
Cancellations | (22,375) | (45,700) | (30,750) |
Expirations | (32,750) | (99,250) | (230,577) |
Ending balance | 1,548,825 | 1,456,200 | 1,775,400 |
Options exercisable at End of Period | 1,279,825 | ||
Weighted-average exercise price | |||
Beginning balance | $ 13.64 | $ 13.44 | $ 14.28 |
Grants | 13.56 | 17.38 | 15.44 |
Exercises | 4.93 | 11.34 | 9.01 |
Cancellations | 16.95 | 16.40 | 15.39 |
Expirations | 15.50 | 20.40 | 27.16 |
Ending balance | 13.87 | $ 13.64 | $ 13.44 |
Options exercisable at End of Period | $ 13.76 | ||
Weighted-average remaining contractual life (years) | |||
Options outstanding, Ending balance | 4 years 2 months 12 days | ||
Options exercisable, Ending balance | 3 years 2 months 12 days | ||
Aggregate intrinsic value | |||
Options outstanding, end of period | $ 450,500 | ||
Options exercisable, end of period | $ 450,500 |
Fair Value Stock Options at Gra
Fair Value Stock Options at Grant Date using Weighted-Average Assumption (Detail) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Weighted Average Fair Values [Line Items] | |||
Historical volatility | 34.00% | 39.00% | 39.00% |
Expected term (years) | 6 years | 6 years | 6 years |
Risk-free interest rate | 2.72% | 1.97% | 1.37% |
Expected dividend yield | 1.22% | 0.98% | 1.10% |
Summary of Restricted Stock Act
Summary of Restricted Stock Activity (Detail) - Restricted Stock - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Number of shares | |||
Beginning balance | 219,317 | 161,824 | 101,435 |
Grants | 223,884 | 133,352 | 109,170 |
Vested | (90,926) | (69,795) | (46,306) |
Cancellations | (25,730) | (6,064) | (2,475) |
Ending balance | 326,545 | 219,317 | 161,824 |
Weighted- average grant date fair value | |||
Beginning balance | $ 17.12 | $ 15.35 | $ 14.77 |
Grants | 13.25 | 18.32 | 15.64 |
Vested | 17.14 | 15.39 | 14.79 |
Cancellations | 14.96 | 16.07 | 14.93 |
Ending balance | $ 14.63 | $ 17.12 | $ 15.35 |
Total unrecognized compensation expense remaining | $ 3,482,300 | ||
Weighted-average years expected to be recognized over | 1 year 7 months 6 days |
Summary of Performance-based Aw
Summary of Performance-based Award Activity (Detail) - Performance Shares - USD ($) | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Number of shares | ||||
Beginning balance | [1] | 228,892 | 145,962 | 66,150 |
Grants | [1] | 182,300 | 87,000 | 82,000 |
Vested | [1] | (58,888) | ||
Cancellations | [1] | (13,017) | (4,070) | (2,188) |
Ending balance | [1] | 339,287 | 228,892 | 145,962 |
Total unrecognized compensation expense remaining | [1] | $ 2,388,000 | ||
Weighted-average grant date fair value | ||||
Beginning balance | $ 16.49 | $ 15.32 | $ 14.84 | |
Grants | 12.81 | 18.45 | 15.69 | |
Vested | 14.84 | |||
Cancellations | 15.95 | 16.52 | 14.94 | |
Ending balance | $ 14.82 | $ 16.49 | $ 15.32 | |
Weighted-average years expected to be recognized over | [1] | 1 year 8 months 12 days | ||
[1] | Represents the target number of shares to be issued for each performance-based award. |
Calculations of Basic and Dilut
Calculations of Basic and Diluted Income per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Earnings Per Share Disclosure [Line Items] | |||
Net (loss) income – Basic and Diluted | $ (1,720) | $ 2,154 | $ 15,720 |
Weighted-average shares outstanding - Basic | 19,452 | 14,505 | 14,174 |
Effect of dilutive securities: Stock options and other stock awards | 450 | 375 | |
Weighted-average shares outstanding – Diluted | 19,452 | 14,955 | 14,549 |
Basic (loss) income per common share | $ (0.09) | $ 0.15 | $ 1.11 |
Diluted (loss) income per common share | $ (0.09) | $ 0.14 | $ 1.08 |
(LOSS) Income Per Common Shar_2
(LOSS) Income Per Common Share - Additional Information (Detail) - shares | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Stock Options | |||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive Securities Excluded from Computation of Diluted Income Per Common Share | 1,869,120 | 1,190,261 | 1,335,113 |
Components of Income Before Inc
Components of Income Before Income Taxes. Equity in Earnings and Extra Ordinary Items (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Components Of Earnings Loss Before Income Taxes [Line Items] | |||
Domestic | $ 5,455 | $ 17,728 | $ 22,114 |
Foreign | (4,946) | (6,949) | (112) |
Total income before income taxes and equity in earnings | $ 509 | $ 10,779 | $ 22,002 |
Provision for Income Taxes (Bef
Provision for Income Taxes (Before Equity in Earnings) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Current: | |||
Federal | $ 775 | $ 7,041 | $ 8,000 |
State and local | 351 | 957 | 498 |
Foreign | (323) | 4 | 483 |
Deferred | 2,086 | 1,030 | (1,951) |
Income tax provision | $ 2,889 | $ 9,032 | $ 7,030 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Examination [Line Items] | |||
Corporate income tax rate | 21.00% | 35.00% | 35.00% |
Estimated tax expense for one-time transition tax of Tax Act | $ 700,000 | $ 338,000 | |
Provisional benefit related to net change in deferred tax liabilities due to reduction in tax rate | 3,000,000 | ||
Net operating loss carryforward | 2,000,000 | 161,000 | $ 109,000 |
Income tax examination net of federal and state tax benefit, accrued interest | 29,000 | 24,000 | |
Reduction in income tax liability if tax positions sustained | 2,000,000 | ||
Change in unrecognized tax benefits reasonably possible | $ 0 | ||
Income tax examination years description | The Company is no longer subject to U.S. Federal income tax examinations for the years prior to 2015 | ||
Deferrred tax liability related to business acquistion | $ 13,900,000 | ||
Deferred tax liability due to uncertain tax position | 300,000 | ||
Operayting Loss Carry Forward | 7,071,000 | $ 4,114,000 | |
Deferred tax asset related to interest carried forward | 1,000,000 | ||
State Jurisdiction | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforward | $ 24,900,000 | ||
Net operating loss carryforward expiration | 2026 | ||
State Jurisdiction | Minimum | |||
Income Tax Examination [Line Items] | |||
Income tax examination year | 2014 | ||
State Jurisdiction | Maximum | |||
Income Tax Examination [Line Items] | |||
Income tax examination year | 2017 | ||
Foreign | |||
Income Tax Examination [Line Items] | |||
Net operating loss carryforward | $ 15,900,000 | ||
Net operating loss carryforward expiration | 2020 |
Significant Components of Defer
Significant Components of Deferred Income Tax Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred income tax assets: | ||
Deferred rent expense | $ 3,504 | $ 2,212 |
Stock options | 2,982 | 2,903 |
Inventory | 1,446 | 970 |
Operating loss and non-deductible interest carry-forward | 7,071 | 4,114 |
Accounts receivable allowances | 734 | 264 |
Accrued compensation | 1,026 | 623 |
Depreciation and amortization | 247 | |
Other | 1,753 | 1,882 |
Total deferred income tax assets | $ 18,516 | $ 13,215 |
Significant Components of Net D
Significant Components of Net Deferred Income Tax Asset (Liability) (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Deferred income tax liabilities: | ||
Fixed assets | $ (2,540) | |
Intangibles | (27,534) | $ (8,732) |
Equity in earnings | (56) | |
Total deferred income tax liabilities | (30,074) | (8,788) |
Net deferred income tax (liability) asset | (11,558) | 4,427 |
Valuation allowance | (2,850) | (3,024) |
Net deferred income tax (liability) asset | $ 1,403 | |
Net deferred income tax (liability) asset | $ (14,408) |
Difference between Provision fo
Difference between Provision for Income Taxes and Amount Computed by Applying Federal Statutory Rates (Detail) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Effective Tax Rate Reconciliation [Line Items] | |||
Provision for federal income taxes at the statutory rate | 21.00% | 35.00% | 35.00% |
State and local income taxes, net of Federal income tax benefit | 97.40% | 6.10% | 3.60% |
Foreign rate differences | (110.30%) | 7.20% | (7.90%) |
Non-deductible expenses | 228.50% | 3.70% | 3.40% |
Tax Act- revaluation of net deferred tax assets and other | 16.80% | 27.70% | |
Tax Act- transition tax | 43.00% | 3.10% | |
Uncertain tax positions | 302.80% | 0.60% | |
Research and development credit | (18.50%) | ||
Federal return to provision | (27.50%) | ||
Other | 14.40% | 0.40% | (2.10%) |
Provision for income taxes | 567.60% | 83.80% | 32.00% |
Estimated Values of Gross Uncer
Estimated Values of Gross Uncertain Tax Positions (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Contingency [Line Items] | |||
Balance at January 1 | $ (161) | $ (109) | $ (157) |
Additions based on tax positions related to the current year | (626) | (82) | |
Additions based on tax positions related to the prior year | (1,302) | ||
Reduction for tax positions of prior years | 114 | 30 | |
Settlements | 48 | ||
Balance at December 31 | $ (1,975) | $ (161) | $ (109) |
Business Segments - Additional
Business Segments - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2018Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable business segment | 2 |
Segment Reporting Information (
Segment Reporting Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||
Segment Reporting Information [Line Items] | ||||
Net sales | $ 704,542 | $ 579,476 | $ 592,619 | |
Depreciation and amortization | 23,329 | 14,189 | 14,148 | |
Income from operations | 18,579 | 15,180 | 27,077 | |
Capital expenditures | 7,902 | 6,311 | 3,380 | |
Assets | 708,572 | 401,521 | ||
Beginning balance | 15,772 | 14,201 | 18,101 | |
Acquisition activity | 78,795 | 434 | ||
Foreign currency translation adjustment | 672 | (1,137) | 3,900 | |
Impairment | 2,205 | |||
Ending balance | 91,690 | 15,772 | 14,201 | |
Unallocated corporate expenses | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | (20,239) | (17,177) | (16,490) | |
Assets | 13,526 | |||
Domestic Wholesale [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 611,973 | 481,719 | 491,549 | |
Depreciation and amortization | [1] | 18,840 | 10,004 | 10,231 |
Capital expenditures | 7,746 | 4,176 | 2,956 | |
Assets | 604,532 | 282,011 | ||
Beginning balance | 2,846 | 2,412 | ||
Acquisition activity | 78,795 | 434 | ||
Ending balance | 81,641 | 2,846 | 2,412 | |
Domestic Wholesale [Member] | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | [2] | 44,213 | 39,341 | 40,515 |
International Operations [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net sales | 92,569 | 97,757 | 101,070 | |
Depreciation and amortization | 4,489 | 4,185 | 3,917 | |
Capital expenditures | 156 | 2,135 | 424 | |
Assets | 94,210 | 105,984 | ||
Beginning balance | 12,926 | 11,789 | ||
Foreign currency translation adjustment | (672) | 1,137 | ||
Impairment | (2,205) | |||
Ending balance | 10,049 | 12,926 | 11,789 | |
International Operations [Member] | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Income from operations | [3] | (5,395) | $ (6,984) | $ 3,052 |
Other Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Assets | $ 9,830 | |||
[1] | The 2016 period includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. | |||
[2] | In 2018 and 2016, income from operations for the U.S. segment includes $2.1 million and $2.4 million, respectively, of restructuring expenses related to the Filament integration and the U.S. restructuring plan, respectively, as described in Note A – Significant Accounting Policies. The 2016 period also includes a $1.2 million charge to correct prior years’ depreciation of certain assets within the U.S. segment. | |||
[3] | In 2018 and 2017 income from operations for the International segment includes $0.2 million and $1.0 million of restructuring expenses related to the integration of entities in Europe, as described in Note A – Significant Accounting Policies. |
Segment Reporting Information_2
Segment Reporting Information (Parenthetical) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Segment Reporting Information [Line Items] | |||
Restructuring expenses | $ 2,324 | $ 1,024 | $ 2,420 |
Depreciation charge | 8,000 | 6,600 | 8,000 |
U.S. Wholesale | |||
Segment Reporting Information [Line Items] | |||
Restructuring expenses | 2,100 | 2,400 | |
International | |||
Segment Reporting Information [Line Items] | |||
Restructuring expenses | $ 200 | $ 1,000 | |
Depreciation Adjustment | |||
Segment Reporting Information [Line Items] | |||
Depreciation charge | $ 1,200 |
Net Sales and Long-Lived Assets
Net Sales and Long-Lived Assets by Major Geographic Locations (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 50,188 | $ 48,793 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 47,812 | 45,285 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 1,896 | 2,779 |
Rest of World | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 480 | $ 729 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | Dec. 11, 2015 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Commitments and Contingencies Disclosure [Line Items] | ||||
Expiration year of lease agreements | 2029 | |||
Rent and related expense | $ 18.4 | $ 16.8 | $ 16.6 | |
Royalty license expiration year | 2023 | |||
Non Income Tax Related Contingencies | $ 1.9 | |||
Capital cost | ||||
Commitments and Contingencies Disclosure [Line Items] | ||||
Remedial alternative, EPA preferred remedy | $ 7.3 |
Future Minimum Payments Under N
Future Minimum Payments Under Non Cancelable Operating Leases (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Leases Future Minimum Payments [Line Items] | |
2019 | $ 16,238 |
2020 | 14,898 |
2021 | 14,498 |
2022 | 14,744 |
2023 | 14,589 |
Thereafter | 62,698 |
Total | $ 137,665 |
Future Minimum Royalties Payabl
Future Minimum Royalties Payable (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Contractual Obligation [Line Items] | |
Future minimum royalties payable under license agreements, 2019 | $ 7,927 |
Future minimum royalties payable under license agreements, 2020 | 8,485 |
Future minimum royalties payable under license agreements, 2021 | 8,942 |
Future minimum royalties payable under license agreements, 2022 | 926 |
Future minimum royalties payable under license agreements, 2023 | 156 |
Total | $ 26,436 |
Retirement Plans - Additional I
Retirement Plans - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined contribution retirement plan voluntary contributions | $ 18,500 | |
Retirement benefit obligations discount rate | 3.98% | 3.33% |
Expected actuarial losses included in accumulated other comprehensive loss in net periodic benefit cost in 2019 | $ 84,000 | |
Former Executives | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Retirement benefit obligations | 6,600,000 | $ 7,300,000 |
Employees 50 years or over | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined contribution retirement plan voluntary contributions | $ 24,500 |
Future Retirement Benefit Payme
Future Retirement Benefit Payments (Detail) $ in Thousands | Dec. 31, 2018USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
2019 | $ 421 |
2020 | 407 |
2021 | 404 |
2022 | 449 |
2023 | 433 |
2024 through 2028 | $ 1,937 |
Components of Inventory (Detail
Components of Inventory (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Inventory [Line Items] | ||
Finished goods | $ 165,969 | $ 125,355 |
Work in process | 375 | 86 |
Raw materials | 7,257 | 6,995 |
Total | $ 173,601 | $ 132,436 |
Property and Equipment (Detail)
Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Property, Plant and Equipment [Line Items] | ||
Construction in progress | $ 1,032 | $ 3,122 |
Land | 100 | 100 |
Property plant and equipment gross | 138,230 | 127,882 |
Less: accumulated depreciation and amortization | (112,468) | (104,817) |
Total | 25,762 | 23,065 |
Machinery, Furniture and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 106,525 | 91,282 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | 29,803 | 32,591 |
Building and Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment gross | $ 770 | $ 787 |
Other - Additional Information
Other - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Other [Line Items] | |||
Depreciation charge | $ 8,000 | $ 6,600 | $ 8,000 |
Accumulated depreciation and amortization | 112,468 | 104,817 | |
Assets Held under Capital Leases | |||
Other [Line Items] | |||
Machinery, furniture and equipment | 1,800 | 2,000 | |
Accumulated depreciation and amortization | $ 1,700 | $ 1,900 |
Accrued Expenses (Detail)
Accrued Expenses (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Accrued Liabilities [Line Items] | ||
Customer allowances and rebates | $ 12,184 | $ 11,662 |
Compensation and benefits | 9,065 | 9,613 |
Interest | 243 | 191 |
Vendor invoices | 3,487 | 4,027 |
Royalties | 1,916 | 1,744 |
Commissions | 1,557 | 786 |
Freight | 4,160 | 4,002 |
Professional fees | 2,473 | 3,160 |
VAT | 79 | 1,176 |
Foreign exchange contracts | 1,951 | |
Restructuring | 1,557 | |
Other | 8,735 | 5,809 |
Total | $ 45,456 | $ 44,121 |
Deferred Rent and Other Long Te
Deferred Rent and Other Long Term Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Schedule Of Other Liabilities Noncurrent [Line Items] | ||
Deferred rent liability | $ 13,832 | $ 13,399 |
Retirement benefit obligations | 6,169 | 6,829 |
Non-income tax liability | 1,860 | |
Royalty obligation | 1,324 | |
Other long term obligations | 154 | 21 |
Total | $ 23,339 | $ 20,249 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Supplemental disclosure of cash flow information: | |||
Cash paid for interest | $ 16,319 | $ 3,791 | $ 4,171 |
Cash paid for taxes | 2,599 | 12,936 | 6,384 |
Non-cash investing activities: | |||
Translation adjustment | $ (5,906) | $ 7,823 | $ (23,061) |
Components of Accumulated Other
Components of Accumulated Other Comprehensive Loss, Net (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Balance at beginning of year | $ 210,279 | $ 197,728 | $ 199,468 | |||
Amounts reclassified from accumulated other comprehensive loss | 14 | |||||
Balance at end of year | 279,493 | 210,279 | 197,728 | |||
Accumulated translation adjustment: | ||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Balance at beginning of year | (27,821) | (35,644) | (12,961) | |||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (5,906) | 7,823 | (23,061) | |||
Amounts reclassified from accumulated other comprehensive loss | [1] | 378 | ||||
Balance at end of year | (33,727) | (27,821) | (35,644) | |||
Accumulated deferred gains (losses) on cash flow hedges: | ||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Balance at beginning of year | 14 | [2] | (3) | [2] | (20) | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | [2] | 161 | 17 | 17 | ||
Amounts reclassified from accumulated other comprehensive loss | [2] | (14) | ||||
Balance at end of year | [2] | 161 | 14 | (3) | ||
Accumulated effect of retirement benefit obligations: | ||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||||
Balance at beginning of year | (1,518) | (1,352) | (1,204) | |||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 373 | (228) | (202) | |||
Amounts reclassified from accumulated other comprehensive loss | [3] | 95 | 62 | 54 | ||
Balance at end of year | $ (1,050) | $ (1,518) | $ (1,352) | |||
[1] | Amount is recorded in equity in earnings (losses) on the consolidated statements of operations. | |||||
[2] | Amounts reclassified are recorded in interest expense on the consolidated statement of operations. | |||||
[3] | Amount is recorded in selling, general and administrative expenses on the consolidated statements of operations. |
Valuation and Qualifying Acco_2
Valuation and Qualifying Accounts (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | $ 6,190 | $ 5,725 | $ 5,300 | $ 6,663 | |
Additions Due to acquisitions | 421 | 0 | 0 | 0 | |
Additions Charged to costs and expenses | 5,082 | 4,926 | 5,237 | 6,730 | |
Deductions | (3,838) | (4,461) | (4,812) | (8,093) | |
Balance at end of period | 7,855 | 6,190 | 5,725 | 5,300 | |
Allowance for Doubtful Accounts | |||||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | 1,158 | 648 | 697 | 815 | |
Additions Due to acquisitions | 0 | 0 | 0 | 0 | |
Additions Charged to costs and expenses | 786 | 594 | 127 | 226 | |
Deductions | [1] | (448) | (84) | (176) | (344) |
Balance at end of period | 1,496 | 1,158 | 648 | 697 | |
Allowance for Sales Returns | |||||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||||
Balance at beginning of period | 5,032 | 5,077 | 4,603 | 5,848 | |
Additions Due to acquisitions | 421 | 0 | 0 | 0 | |
Additions Charged to costs and expenses | [2] | 4,296 | 4,332 | 5,110 | 6,504 |
Deductions | [3] | (3,390) | (4,377) | (4,636) | (7,749) |
Balance at end of period | $ 6,359 | $ 5,032 | $ 5,077 | $ 4,603 | |
[1] | Uncollectible accounts written off, net of recoveries. | ||||
[2] | Charged to net sales. | ||||
[3] | Allowances granted. |