Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Nov. 30, 2020 | Dec. 31, 2020 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Nov. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-11107 | |
Entity Registrant Name | FRANKLIN COVEY CO | |
Entity Incorporation, State or Country Code | UT | |
Entity Tax Identification Number | 87-0401551 | |
Entity Address, Address Line One | 2200 West Parkway Boulevard | |
Entity Address, City or Town | Salt Lake City | |
Entity Address, State or Province | UT | |
Entity Address, Postal Zip Code | 84119-2099 | |
City Area Code | 801 | |
Local Phone Number | 817-1776 | |
Title of 12(b) Security | Common Stock, $.05 Par Value | |
Trading Symbol | FC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 14,036,458 | |
Amendment Flag | false | |
Entity Central Index Key | 0000886206 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --08-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 34,260 | $ 27,137 |
Accounts receivable, less allowance for doubtful accounts of $3,751 and $4,159 | 43,066 | 56,407 |
Inventories | 2,675 | 2,974 |
Prepaid expenses and other current assets | 15,430 | 15,146 |
Total current assets | 95,431 | 101,664 |
Property and equipment, net | 14,169 | 15,723 |
Intangible assets, net | 45,996 | 47,125 |
Goodwill | 24,220 | 24,220 |
Deferred income tax assets | 1,028 | 1,094 |
Other long-term assets | 15,516 | 15,611 |
Total assets | 196,360 | 205,437 |
Current liabilities: | ||
Current portion of term notes payable | 5,000 | 5,000 |
Current portion of financing obligation | 2,670 | 2,600 |
Accounts payable | 3,691 | 5,622 |
Deferred subscription revenue | 55,681 | 59,289 |
Other deferred revenue | 7,654 | 7,389 |
Accrued liabilities | 21,902 | 22,628 |
Total current liabilities | 96,598 | 102,528 |
Term notes payable, less current portion | 13,750 | 15,000 |
Financing obligation, less current portion | 13,350 | 14,048 |
Other liabilities | 8,820 | 9,110 |
Deferred income tax liabilities | 5,089 | 5,298 |
Total liabilities | 137,607 | 145,984 |
Shareholders’ equity: | ||
Common stock, $.05 par value; 40,000 shares authorized, 27,056 shares issued | 1,353 | 1,353 |
Additional paid-in capital | 209,667 | 211,920 |
Retained earnings | 49,076 | 49,968 |
Accumulated other comprehensive income | 948 | 641 |
Treasury stock at cost, 13,028 shares and 13,175 shares | (202,291) | (204,429) |
Total shareholders’ equity | 58,753 | 59,453 |
Total liabilities and shareholders' equity | $ 196,360 | $ 205,437 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts | $ 3,751 | $ 4,159 |
Common stock, par value | $ 0.05 | $ 0.05 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 27,056,000 | 27,056,000 |
Treasury stock, shares | 13,028,000 | 13,175,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations And Statements Of Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Condensed Consolidated Statements Of Operations And Statements Of Comprehensive Loss [Abstract] | ||
Net sales | $ 48,324 | $ 58,613 |
Cost of sales | 11,938 | 16,584 |
Gross profit | 36,386 | 42,029 |
Selling, general, and administrative | 33,683 | 39,399 |
Depreciation | 1,741 | 1,619 |
Amortization | 1,131 | 1,170 |
Loss from operations | (169) | (159) |
Interest income | 24 | 5 |
Interest expense | (568) | (606) |
Loss before income taxes | (713) | (760) |
Income tax benefit (provision) | (179) | 216 |
Net loss | $ (892) | $ (544) |
Net loss per share: | ||
Basic and diluted | $ (0.06) | $ (0.04) |
Weighted average number of common shares: | ||
Basic and diluted | 13,977 | 13,982 |
COMPREHENSIVE LOSS | ||
Net loss | $ (892) | $ (544) |
Foreign currency translation adjustments, net of income tax benefit of $0 and $0 | 307 | (37) |
Comprehensive loss | $ (585) | $ (581) |
Condensed Consolidated Statem_2
Condensed Consolidated Statements Of Operations And Statements Of Comprehensive Loss (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Condensed Consolidated Statements Of Operations And Statements Of Comprehensive Loss [Abstract] | ||
Foreign currency translation adjustments, tax | $ 0 | $ 0 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (892) | $ (544) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 2,872 | 2,789 |
Amortization of capitalized curriculum costs | 889 | 1,029 |
Stock-based compensation | 1,158 | 1,851 |
Deferred income taxes | (111) | (115) |
Change in fair value of contingent consideration liabilities | 62 | 91 |
Amortization of right-of-use operating lease assets | 259 | |
Loss on disposal of assets | 35 | |
Changes in assets and liabilities, net of effect of acquired business: | ||
Decrease in accounts receivable, net | 13,482 | 20,090 |
Decrease in inventories | 309 | 328 |
Decrease (increase) in prepaid expenses and other assets | (176) | 656 |
Decrease in accounts payable and accrued liabilities | (2,721) | (9,333) |
Decrease in deferred revenue | (3,625) | (9,006) |
Increase (decrease) in income taxes payable/receivable | (111) | (1,029) |
Decrease in other long-term liabilities | (519) | (6) |
Net cash provided by operating activities | 10,876 | 6,836 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property and equipment | (185) | (1,408) |
Curriculum development costs | (263) | (458) |
Purchase of note receivable from bank | (2,600) | |
Net cash used for investing activities | (448) | (4,466) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from term notes payable | 5,000 | |
Principal payments on term notes payable | (1,250) | (1,250) |
Principal payments on financing obligation | (628) | (564) |
Purchases of common stock for treasury | (1,530) | (3) |
Payment of contingent consideration liabilities | (329) | (782) |
Proceeds from sales of common stock held in treasury | 256 | 254 |
Net cash provided by (used for) financing activities | (3,481) | 2,655 |
Effect of foreign currency exchange rates on cash and cash equivalents | 176 | 37 |
Net increase in cash and cash equivalents | 7,123 | 5,062 |
Cash and cash equivalents at the beginning of the period | 27,137 | 27,699 |
Cash and cash equivalents at the end of the period | 34,260 | 32,761 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 403 | 932 |
Cash paid for interest | 562 | 580 |
Non-cash investing and financing activities: | ||
Purchases of property and equipment financed by accounts payable | 20 | 249 |
Acquisition of right-of-use operating lease assets for operating lease | $ 726 | |
Use of notes receivable to modify revenue contract | $ 3,246 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements Of Changes In Shareholders' Equity - USD ($) shares in Thousands, $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income [Member] | Treasury Stock [Member] | Total |
Beginning balance, shares at Aug. 31, 2019 | 27,056 | |||||
Beginning balance at Aug. 31, 2019 | $ 1,353 | $ 215,964 | $ 59,403 | $ 269 | ||
Beginning balance, shares, Treasury at Aug. 31, 2019 | (13,087) | |||||
Beginning balance, Treasury at Aug. 31, 2019 | $ (194,975) | |||||
Issuance of common stock from treasury, shares | 9 | |||||
Issuance of common stock from treasury | 131 | $ 123 | ||||
Purchase of treasury shares | $ (3) | |||||
Stock-based compensation | 1,851 | |||||
Cumulative translation adjustments | (37) | $ (37) | ||||
Net loss | (544) | (544) | ||||
Ending balance, shares at Nov. 30, 2019 | 27,056 | |||||
Ending balance at Nov. 30, 2019 | $ 1,353 | 217,946 | 58,859 | 232 | ||
Ending balance, shares, Treasury at Nov. 30, 2019 | (13,078) | |||||
Ending balance, Treasury at Nov. 30, 2019 | $ (194,855) | |||||
Beginning balance, shares at Aug. 31, 2020 | 27,056 | |||||
Beginning balance at Aug. 31, 2020 | $ 1,353 | 211,920 | 49,968 | 641 | 59,453 | |
Beginning balance, shares, Treasury at Aug. 31, 2020 | (13,175) | |||||
Beginning balance, Treasury at Aug. 31, 2020 | $ (204,429) | |||||
Issuance of common stock from treasury, shares | 236 | |||||
Issuance of common stock from treasury | (3,411) | $ 3,668 | ||||
Purchase of treasury shares, shares | (89) | |||||
Purchase of treasury shares | $ (1,530) | |||||
Stock-based compensation | 1,158 | |||||
Cumulative translation adjustments | 307 | 307 | ||||
Net loss | (892) | (892) | ||||
Ending balance, shares at Nov. 30, 2020 | 27,056 | |||||
Ending balance at Nov. 30, 2020 | $ 1,353 | $ 209,667 | $ 49,076 | $ 948 | $ 58,753 | |
Ending balance, shares, Treasury at Nov. 30, 2020 | (13,028) | |||||
Ending balance, Treasury at Nov. 30, 2020 | $ (202,291) |
Basis Of Presentation
Basis Of Presentation | 3 Months Ended |
Nov. 30, 2020 | |
Basis Of Presentation [Abstract] | |
Basis Of Presentation | NOTE 1 – BASIS OF PRESENTATION General Franklin Covey Co. (hereafter referred to as us, we, our, or the Company) is a global company focused on organizational performance improvement. Our mission is to “enable greatness in people and organizations everywhere,” and our global structure is designed to help individuals and organizations achieve sustained superior performance through changes in human behavior. We are fundamentally a content and solutions company, and we believe that our offerings and services create the connection between capabilities and results. We have a wide range of content delivery options, including: the All Access Pass (AAP), the Leader in Me membership, and other intellectual property licenses, digital online learning, on-site training, training led through certified facilitators, blended learning, and organization-wide transformational processes, including consulting and coaching. We believe our investments in digital delivery modalities over the past few years have enabled us to deliver our content to clients in a high-quality learning environment whether those clients are working remotely or in a centralized location. We believe that our clients are able to utilize our content to create cultures whose hallmarks are high-performing, collaborative individuals, led by effective, trust-building leaders who execute with excellence and deliver measurably improved results for all of their key stakeholders. We have some of the best-known offerings in the training industry, including a suite of individual-effectiveness and leadership-development training content based on the best-selling books, The 7 Habits of Highly Effective People , The Speed of Trust , The Leader in Me , and The 4 Disciplines of Execution , and proprietary content in the areas of Execution, Sales Performance, Productivity, Educational Improvement, and Customer Loyalty. Our offerings are described in further detail at www.franklincovey.com . The information posted on our website is not incorporated into this report. The accompanying unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position and results of operations of the Company as of the dates and for the periods indicated. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to Securities and Exchange Commission (SEC) rules and regulations. The information included in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our annual report on Form 10-K for the fiscal year ended August 31, 2020. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The results of operations for the quarter ended November 30, 2020 are not necessarily indicative of results expected for the entire fiscal year ending August 31, 2021, or for any future periods. Note on the COVID-19 Pandemic With the rapid spread of COVID-19 around the world and the continuously evolving responses to the pandemic, we have witnessed the significant and growing negative impact of COVID-19 on the global economic and operating environment. These negative impacts significantly reduced our consolidated sales during the quarter ended November 30, 2020 as workplaces and schools were closed in response to the pandemic. In light of these events, we have taken measures to reduce our costs and to maintain adequate liquidity. However, due to the rapidly changing business and education environment, unprecedented market volatility, and other circumstances resulting from the COVID-19 pandemic, we are currently unable to fully determine the extent of COVID-19’s impact on our business in future periods. Our business in future periods will be heavily influenced by the timing, length, and intensity of the economic recoveries in the United States and in other countries around the world. We continue to monitor evolving economic and general business conditions and the actual and potential impacts on our financial position, results of operations, and cash flows. Accounting Pronouncements Issued and Adopted Credit Losses on Financial Instruments On September 1, 2020, we adopted Accounting Standards Update (ASU) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (Topic 326). This new standard is intended to improve financial reporting by requiring more timely recognition of credit losses on our trade accounts receivable and requires the measurement of all expected credit losses based on historical experience, current economic conditions, and reasonable and supportable forecasts. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements and disclosures. For further information on our receivables, refer to Note 3, Receivables . Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement On September 1, 2020, we adopted ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). This guidance clarifies the accounting for implementation costs in a cloud computing arrangement that is a service contract and aligns the requirements for capitalizing those costs with the capitalization requirements for costs incurred to develop or obtain internal-use software. The Company adopted ASU 2018-15 on a prospective basis and the adoption of this new standard did not have a material impact on our condensed consolidated financial statements or disclosures. Accounting Pronouncements Issued Not Yet Adopted In December 2019, the Financial Accounting Standards Board issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes , and clarifies certain aspects of the current guidance to promote consistency among reporting entities. The guidance in ASU 2019-12 is effective for fiscal years beginning after December 15, 2021, although early adoption is permitted. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We are currently evaluating the impact of the provisions of ASU 2019-12 on our consolidated financial statements. |
Inventories
Inventories | 3 Months Ended |
Nov. 30, 2020 | |
Inventories [Abstract] | |
Inventories | NOTE 2 – INVENTORIES Inventories are stated at the lower of cost or net realizable value, cost being determined using the first-in, first-out method, and were comprised of the following (in thousands): November 30, August 31, 2020 2020 Finished goods $ 2,647 $ 2,947 Raw materials 28 27 $ 2,675 $ 2,974 |
Receivables
Receivables | 3 Months Ended |
Nov. 30, 2020 | |
Receivables [Abstract] | |
Receivables | NOTE 3 – RECEIVABLES Our trade accounts receivables are recorded at net realizable value, which includes an allowance for estimated credit losses as described in Note 1, Basis of Presentation . Under the guidance found in ASC Topic 326, the “expected credit loss” model replaces the previous “incurred loss” model and requires consideration of a broader range of information to estimate expected credit losses over the lives of our trade accounts receivable. Our prior methodology for estimating credit losses on our trade accounts receivable did not differ significantly from the new requirements of Topic 326. We maintain an allowance for credit losses related to our trade accounts receivable for future expected credit losses resulting from the inability or unwillingness of our customers to make required payments. We estimate the allowance based upon historical bad debts, current customer receivable balances, age of customer receivable balances and the customers’ financial condition in relation to a representative pool of assets consisting of customers with similar risk characteristics. The allowance is adjusted as appropriate to reflect differences in current conditions as well as changes in forecasted macroeconomic conditions. Receivables that do not share risk characteristics are evaluated on an individual basis, including those associated with customers that have a higher probability of default. Our estimate of credit losses includes expected current and future economic and market conditions surrounding the COVID-19 pandemic, which did not significantly impact our allowance. We do not have a significant amount of notes or other receivables. The following provides a reconciliation of the activity in our allowance for estimated credit losses during the quarter ended November 30, 2020 (in thousands): Balance at August 31, 2020 $ 4,159 Charged to costs and expenses 247 Amounts written off ( 655 ) Balance at November 30, 2020 $ 3,751 No customer represented more than 10 percent of our total trade receivables balance at November 30, 2020 or August 31, 2020. |
Fair Value Of Financial Instrum
Fair Value Of Financial Instruments | 3 Months Ended |
Nov. 30, 2020 | |
Fair Value Of Financial Instruments [Abstract] | |
Fair Value Of Financial Instruments | NOTE 4 – FAIR VALUE OF FINANCIAL INSTRUMENTS At November 30, 2020, the carrying value of our financial instruments approximated their fair values. The fair values of our contingent consideration liabilities from previous business acquisitions are considered “Level 3” measurements because we use various estimates in the valuation models to project the timing and amount of future contingent payments. The fair value of the contingent consideration liabilities from the acquisitions of Jhana Education (Jhana) and Robert Gregory Partners (RGP) changed as follows during the quarter ended November 30, 2020 (in thousands): Jhana RGP Total Balance at August 31, 2020 $ 3,067 $ 816 $ 3,883 Change in fair value 80 ( 18 ) 62 Payments ( 329 ) - ( 329 ) Balance at November 30, 2020 $ 2,818 $ 798 $ 3,616 At each quarterly reporting date, we estimate the fair value of the contingent liabilities from both the Jhana and RGP acquisitions through the use of Monte Carlo simulations. Based on the timing of expected payments, $ 1.1 million of the Jhana and all of the RGP contingent consideration liabilities were recorded as components of accrued liabilities at November 30, 2020. The remaining $ 1.7 million of the Jhana contingent consideration liability is reported in other long-term liabilities. Adjustments to the fair value of our contingent consideration liabilities are included in selling, general, and administrative expense in the accompanying condensed consolidated statements of operations and comprehensive loss. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Nov. 30, 2020 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | NOTE 5 – REVENUE RECOGNITION Contract Balances Our deferred revenue totaled $ 65.3 million at November 30, 2020 and $ 68.9 million at August 31, 2020, of which $ 2.0 million and $ 2.2 million were classified as components of other long-term liabilities at November 30, 2020, and August 31, 2020, respectively. The amount of deferred revenue that was generated from subscription offerings totaled $ 56.9 million at November 30, 2020 and $ 60.6 million at August 31, 2020. During the quarter ended November 30, 2020, we recognized $ 20.7 million of previously deferred subscription revenue. Remaining Performance Obligations When possible, we enter into multi-year non-cancellable contracts which are invoiced either upon execution of the contract or at the beginning of each annual contract period. Remaining transaction price represents contracted revenue that has not yet been recognized, including unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Transaction price is influenced by factors such as seasonality, the average length of the contract term, and the ability of the Company to continue to enter multi-year non-cancellable contracts. At November 30, 2020, we had $ 97.4 million of remaining performance obligations, including the amount of deferred revenue related to our subscription offerings. The remaining performance obligation does not include other deferred revenue, as amounts included in other deferred revenue include items such as deposits that are generally refundable at the client’s request prior to the satisfaction of the obligation. Disaggregated Revenue Information Refer to Note 9, Segment Information , to these condensed consolidated financial statements for our disaggregated revenue information. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Nov. 30, 2020 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | NOTE 6 – STOCK-BASED COMPENSATION Our stock-based compensation was comprised of the following for the periods presented (in thousands): Quarter Ended November 30, November 30, 2020 2019 Long-term incentive awards $ 946 $ 1,636 Restricted stock awards 175 175 Employee stock purchase plan 37 40 $ 1,158 $ 1,851 During the quarter ended November 30, 2020, we issued 236,133 shares of our common stock under various stock-based compensation arrangements, including our employee stock purchase plan (ESPP). Our stock-based compensation plans also allow shares to be withheld to cover statutory income taxes if so elected by the award recipient. During the first quarter of fiscal 2021, we withheld 88,704 shares of our common stock for taxes on stock-based compensation arrangements, which had a fair value of $ 1.5 million. Due to the significant impact of the COVID-19 pandemic on our results of operations in the third quarter of fiscal 2020 and uncertainties surrounding the economic recovery from the pandemic, we determined that the long-term incentive plan (LTIP) award tranches which vest based on qualified adjusted earnings before interest, taxes, depreciation, and amortization (Adjusted EBITDA) for our various LTIP awards would not vest before the end of their respective service periods. On October 2, 2020, the Organization and Compensation Committee (the Compensation Committee) of the Board of Directors modified the terms of our performance-based LTIP award tranches to extend the service period of each tranche by two year s and increase each Adjusted EBITDA vesting target by $ 2.0 million. No time-based vesting LTIP tranches were modified. At November 30, 2020, we reassessed the probability that the modified award tranches would vest and concluded the modified award tranches would vest prior to the end of their respective service periods. We accounted for the modifications in accordance with the applicable accounting guidance and are recognizing compensation cost for awards expected to vest over the remaining service period of each award. Fiscal 2021 Long-Term Incentive Plan Award On October 2, 2020, the Compensation Committee granted a new LTIP award to our executive officers and members of senior management. The fiscal 2021 LTIP award has two tranches, one with a time-based vesting condition and one with a performance-based vesting condition as described below: Time-Based Award Shares – Twenty-five percent of the 2021 LTIP award shares vest to participants on August 31, 2023. The total number of shares that may be earned by participants at the end of the service period totals 52,696 shares. The number of shares awarded in this tranche does not fluctuate based on the achievement of financial measures. Performance-Based Award Shares – The remaining tranche of the fiscal 2021 LTIP award is based on the highest rolling four-quarter level of qualified Adjusted EBITDA in the three-year period ending August 31, 2023. The number of shares that will vest to participants for this tranche is variable and may be 50 percent of the award (minimum award threshold) or up to 200 percent of the participant’s award (maximum threshold) depending on the level of qualified Adjusted EBITDA achieved. The number of shares that may be earned for achieving 100 percent of the performance-based objective totals 158,088 shares. The maximum number of shares that may be awarded in connection with the performance-based tranche of the 2021 LTIP totals 316,176 shares. Employee Stock Purchase Plan We have an employee stock purchase plan that offers qualified employees the opportunity to purchase shares of our common stock at a price equal to 85 percent of the average fair market value of our common stock on the last trading day of each fiscal quarter. During the quarter ended November 30, 2020, we issued 15,097 shares of our common stock to participants in the ESPP. |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2020 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 7 – INCOME TAXES We recorded $ 0.2 million of income tax expense during the quarter ended November 30, 2020 on a pre-tax loss of $ 0.7 million, resulting in an effective tax expense rate of 25 percent. Our effective tax rate was adversely impacted by non-deductible executive compensation and certain other non-deductible expenses. We computed our income tax provision for the first quarter of fiscal 2021 using the discrete method, applying the actual year-to-date effective tax rate to our pre-tax loss. We believe that this method yields a more reliable income tax calculation for the period. The estimated annual effective tax rate method is not reasonable due to its sensitivity to small changes in forecasted annual income or loss before income taxes, which would result in significant variations in the customary relationship between income tax expense and pre-tax income or loss for interim periods. |
Loss Per Share
Loss Per Share | 3 Months Ended |
Nov. 30, 2020 | |
Loss Per Share [Abstract] | |
Loss Per Share | NOTE 8 – LOSS PER SHARE The following schedule shows the calculation of loss per share for the periods presented (in thousands, except per-share amounts). Quarter Ended November 30, November 30, 2020 2019 Numerator for basic and diluted loss per share: Net loss $ ( 892 ) $ ( 544 ) Denominator for basic and diluted loss per share: Basic weighted average shares outstanding 13,977 13,982 Effect of dilutive securities: Stock options and other stock-based awards - - Diluted weighted average shares outstanding 13,977 13,982 EPS Calculations: Net loss per share: Basic and diluted $ ( 0.06 ) $ ( 0.04 ) Since we incurred a net loss for the quarter ended November 30, 2020, no potentially dilutive securities are included in the calculation of diluted loss per share for the quarter because such effect would be anti-dilutive. The number of dilutive stock options and other stock-based awards as of November 30, 2020 would have been approximately 112,000 shares. |
Segment Information
Segment Information | 3 Months Ended |
Nov. 30, 2020 | |
Segment Information [Abstract] | |
Segment Information | NOTE 9 – SEGMENT INFORMATION Segment Information Our sales are primarily comprised of training and consulting services and our internal reporting and operating structure is currently organized around two divisions. The Enterprise Division, which consists of our Direct Office and International Licensee segments and the Education Division, which is comprised of our Education practice. Based on the applicable guidance, our operations are comprised of three reportable segments and one corporate services group. The following is a brief description of our reportable segments: Direct Offices – Our Direct Office segment has a depth of expertise in helping organizations solve problems that require changes in human behavior, including leadership, productivity, execution, trust, and sales performance. We have a variety of principle-based offerings that help build winning and profitable cultures. This segment includes our sales personnel that serve the United States and Canada; our international sales offices located in Japan, China, the United Kingdom, Australia, Germany, Switzerland, and Austria; our government services sales channel; and our book and audio sales. International Licensees – Our independently owned international licensees provide our offerings and services in countries where we do not have a directly-owned office. These licensee partners allow us to expand the reach of our services to large multinational organizations as well as smaller organizations in their countries. This segment’s results are primarily comprised of royalty revenues received from these licensees. Education Practice – Centered around the principles found in The Leader in Me , the Education practice is dedicated to helping educational institutions build a culture that will produce great results. We believe these results are manifested by increases in student performance, improved school culture, decreased disciplinary issues, and increased teacher engagement and parental involvement. This segment includes our domestic and international Education practice operations, which are focused on sales to educational institutions such as elementary schools, high schools, and colleges and universities . Corporate and Other – Our corporate and other information includes leasing operations, shipping and handling revenues, royalty revenues from Franklin Planner Corp. and certain corporate administrative functions. We have determined that the Company’s chief operating decision maker is the CEO, and the primary measurement tool used in business unit performance analysis is Adjusted EBITDA, which may not be calculated as similarly titled amounts disclosed by other companies. Adjusted EBITDA is a non-GAAP financial measure. For reporting purposes, our consolidated Adjusted EBITDA may be calculated as net loss excluding interest expense, income taxes, depreciation expense, amortization expense, stock-based compensation, and certain other charges such as adjustments for changes in the fair value of contingent liabilities arising from business acquisitions. We reference this non-GAAP financial measure in our decision making because it provides supplemental information that facilitates consistent internal comparisons to the historical operating performance of prior periods and we believe it provides investors with greater transparency to evaluate operational activities and financial results. Our operations are not capital intensive and we do not own any manufacturing facilities or equipment. Accordingly, we do not allocate assets to the reportable segments for analysis purposes. Interest expense and interest income are primarily generated at the corporate level and are not allocated. Income taxes are likewise calculated and paid on a corporate level (except for entities that operate in foreign jurisdictions) and are not allocated for analysis purposes. We account for the following segment information on the same basis as the accompanying condensed consolidated financial statements (in thousands). Sales to Quarter Ended External Adjusted November 30, 2020 Customers Gross Profit EBITDA Enterprise Division: Direct offices $ 36,743 $ 29,439 $ 6,693 International licensees 2,596 2,285 1,294 39,339 31,724 7,987 Education practice 7,498 3,986 ( 2,285 ) Corporate and eliminations 1,487 676 ( 1,986 ) Consolidated $ 48,324 $ 36,386 $ 3,716 Quarter Ended November 30, 2019 Enterprise Division: Direct offices $ 42,111 $ 31,411 $ 5,710 International licensees 3,721 3,120 2,035 45,832 34,531 7,745 Education practice 11,082 6,657 ( 1,102 ) Corporate and eliminations 1,699 841 ( 1,682 ) Consolidated $ 58,613 $ 42,029 $ 4,961 A reconciliation of our consolidated Adjusted EBITDA to consolidated net loss is provided below (in thousands). Quarter Ended November 30, November 30, 2020 2019 Segment Adjusted EBITDA $ 5,702 $ 6,643 Corporate expenses ( 1,986 ) ( 1,682 ) Consolidated Adjusted EBITDA 3,716 4,961 Stock-based compensation ( 1,158 ) ( 1,851 ) Increase in the fair value of contingent consideration liabilities ( 62 ) ( 91 ) Government COVID-19 assistance 207 - Knowledge Capital wind-down costs - ( 389 ) Depreciation ( 1,741 ) ( 1,619 ) Amortization ( 1,131 ) ( 1,170 ) Loss from operations ( 169 ) ( 159 ) Interest income 24 5 Interest expense ( 568 ) ( 606 ) Loss before income taxes ( 713 ) ( 760 ) Income tax benefit (provision) ( 179 ) 216 Net loss $ ( 892 ) $ ( 544 ) Revenue by Category The following table presents our revenue disaggregated by geographic region (in thousands). Quarter Ended November 30, November 30, 2020 2019 Americas $ 38,327 $ 44,036 Asia Pacific 3,191 10,139 Europe/Middle East/Africa 6,806 4,438 $ 48,324 $ 58,613 The following table presents our revenue disaggregated by type of service (in thousands). Quarter Ended Services and Leases and November 30, 2020 Products Subscriptions Royalties Other Consolidated Enterprise Division: Direct offices $ 19,412 $ 16,614 $ 717 $ - $ 36,743 International licensees 331 - 2,265 - 2,596 19,743 16,614 2,982 - 39,339 Education practice 1,924 5,075 499 - 7,498 Corporate and eliminations - - 335 1,152 1,487 Consolidated $ 21,667 $ 21,689 $ 3,816 $ 1,152 $ 48,324 Quarter Ended November 30, 2019 Enterprise Division: Direct offices $ 27,251 $ 14,288 $ 572 $ - $ 42,111 International licensees 590 - 3,131 - 3,721 27,841 14,288 3,703 - 45,832 Education practice 3,585 6,818 679 - 11,082 Corporate and eliminations - - 379 1,320 1,699 Consolidated $ 31,426 $ 21,106 $ 4,761 $ 1,320 $ 58,613 |
Basis Of Presentation (Policy)
Basis Of Presentation (Policy) | 3 Months Ended |
Nov. 30, 2020 | |
Basis Of Presentation [Abstract] | |
General | General Franklin Covey Co. (hereafter referred to as us, we, our, or the Company) is a global company focused on organizational performance improvement. Our mission is to “enable greatness in people and organizations everywhere,” and our global structure is designed to help individuals and organizations achieve sustained superior performance through changes in human behavior. We are fundamentally a content and solutions company, and we believe that our offerings and services create the connection between capabilities and results. We have a wide range of content delivery options, including: the All Access Pass (AAP), the Leader in Me membership, and other intellectual property licenses, digital online learning, on-site training, training led through certified facilitators, blended learning, and organization-wide transformational processes, including consulting and coaching. We believe our investments in digital delivery modalities over the past few years have enabled us to deliver our content to clients in a high-quality learning environment whether those clients are working remotely or in a centralized location. We believe that our clients are able to utilize our content to create cultures whose hallmarks are high-performing, collaborative individuals, led by effective, trust-building leaders who execute with excellence and deliver measurably improved results for all of their key stakeholders. We have some of the best-known offerings in the training industry, including a suite of individual-effectiveness and leadership-development training content based on the best-selling books, The 7 Habits of Highly Effective People , The Speed of Trust , The Leader in Me , and The 4 Disciplines of Execution , and proprietary content in the areas of Execution, Sales Performance, Productivity, Educational Improvement, and Customer Loyalty. Our offerings are described in further detail at www.franklincovey.com . The information posted on our website is not incorporated into this report. The accompanying unaudited condensed consolidated financial statements reflect, in the opinion of management, all adjustments (consisting of normal recurring accruals) necessary to present fairly the financial position and results of operations of the Company as of the dates and for the periods indicated. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to Securities and Exchange Commission (SEC) rules and regulations. The information included in this quarterly report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our annual report on Form 10-K for the fiscal year ended August 31, 2020. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The results of operations for the quarter ended November 30, 2020 are not necessarily indicative of results expected for the entire fiscal year ending August 31, 2021, or for any future periods. |
Note On The COVID-19 Pandemic | Note on the COVID-19 Pandemic With the rapid spread of COVID-19 around the world and the continuously evolving responses to the pandemic, we have witnessed the significant and growing negative impact of COVID-19 on the global economic and operating environment. These negative impacts significantly reduced our consolidated sales during the quarter ended November 30, 2020 as workplaces and schools were closed in response to the pandemic. In light of these events, we have taken measures to reduce our costs and to maintain adequate liquidity. However, due to the rapidly changing business and education environment, unprecedented market volatility, and other circumstances resulting from the COVID-19 pandemic, we are currently unable to fully determine the extent of COVID-19’s impact on our business in future periods. Our business in future periods will be heavily influenced by the timing, length, and intensity of the economic recoveries in the United States and in other countries around the world. We continue to monitor evolving economic and general business conditions and the actual and potential impacts on our financial position, results of operations, and cash flows. |
Accounting Pronouncements Issued And Adopted | Accounting Pronouncements Issued and Adopted Credit Losses on Financial Instruments On September 1, 2020, we adopted Accounting Standards Update (ASU) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (Topic 326). This new standard is intended to improve financial reporting by requiring more timely recognition of credit losses on our trade accounts receivable and requires the measurement of all expected credit losses based on historical experience, current economic conditions, and reasonable and supportable forecasts. The adoption of this ASU did not have a material impact on our condensed consolidated financial statements and disclosures. For further information on our receivables, refer to Note 3, Receivables . Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement On September 1, 2020, we adopted ASU No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (ASU 2018-15). This guidance clarifies the accounting for implementation costs in a cloud computing arrangement that is a service contract and aligns the requirements for capitalizing those costs with the capitalization requirements for costs incurred to develop or obtain internal-use software. The Company adopted ASU 2018-15 on a prospective basis and the adoption of this new standard did not have a material impact on our condensed consolidated financial statements or disclosures. |
Accounting Pronouncements Issued Not Yet Adopted | Accounting Pronouncements Issued Not Yet Adopted In December 2019, the Financial Accounting Standards Board issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes , and clarifies certain aspects of the current guidance to promote consistency among reporting entities. The guidance in ASU 2019-12 is effective for fiscal years beginning after December 15, 2021, although early adoption is permitted. Most amendments within the standard are required to be applied on a prospective basis, while certain amendments must be applied on a retrospective or modified retrospective basis. We are currently evaluating the impact of the provisions of ASU 2019-12 on our consolidated financial statements. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Inventories [Abstract] | |
Components Of Inventories | November 30, August 31, 2020 2020 Finished goods $ 2,647 $ 2,947 Raw materials 28 27 $ 2,675 $ 2,974 |
Receivables (Tables)
Receivables (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Receivables [Abstract] | |
Activity In Allowance For Doubtful Accounts | Balance at August 31, 2020 $ 4,159 Charged to costs and expenses 247 Amounts written off ( 655 ) Balance at November 30, 2020 $ 3,751 |
Fair Value Of Financial Instr_2
Fair Value Of Financial Instruments (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Fair Value Of Financial Instruments [Abstract] | |
Schedule Of Contingent Consideration Liability | Jhana RGP Total Balance at August 31, 2020 $ 3,067 $ 816 $ 3,883 Change in fair value 80 ( 18 ) 62 Payments ( 329 ) - ( 329 ) Balance at November 30, 2020 $ 2,818 $ 798 $ 3,616 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Stock-Based Compensation [Abstract] | |
Total Cost Of Stock-Based Compensation | Quarter Ended November 30, November 30, 2020 2019 Long-term incentive awards $ 946 $ 1,636 Restricted stock awards 175 175 Employee stock purchase plan 37 40 $ 1,158 $ 1,851 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Loss Per Share [Abstract] | |
Computation Of Loss Per Share | Quarter Ended November 30, November 30, 2020 2019 Numerator for basic and diluted loss per share: Net loss $ ( 892 ) $ ( 544 ) Denominator for basic and diluted loss per share: Basic weighted average shares outstanding 13,977 13,982 Effect of dilutive securities: Stock options and other stock-based awards - - Diluted weighted average shares outstanding 13,977 13,982 EPS Calculations: Net loss per share: Basic and diluted $ ( 0.06 ) $ ( 0.04 ) |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Nov. 30, 2020 | |
Segment Information [Abstract] | |
Schedule Of Segment Operations | Sales to Quarter Ended External Adjusted November 30, 2020 Customers Gross Profit EBITDA Enterprise Division: Direct offices $ 36,743 $ 29,439 $ 6,693 International licensees 2,596 2,285 1,294 39,339 31,724 7,987 Education practice 7,498 3,986 ( 2,285 ) Corporate and eliminations 1,487 676 ( 1,986 ) Consolidated $ 48,324 $ 36,386 $ 3,716 Quarter Ended November 30, 2019 Enterprise Division: Direct offices $ 42,111 $ 31,411 $ 5,710 International licensees 3,721 3,120 2,035 45,832 34,531 7,745 Education practice 11,082 6,657 ( 1,102 ) Corporate and eliminations 1,699 841 ( 1,682 ) Consolidated $ 58,613 $ 42,029 $ 4,961 |
Reconciliation Of Adjusted EBITDA | Quarter Ended November 30, November 30, 2020 2019 Segment Adjusted EBITDA $ 5,702 $ 6,643 Corporate expenses ( 1,986 ) ( 1,682 ) Consolidated Adjusted EBITDA 3,716 4,961 Stock-based compensation ( 1,158 ) ( 1,851 ) Increase in the fair value of contingent consideration liabilities ( 62 ) ( 91 ) Government COVID-19 assistance 207 - Knowledge Capital wind-down costs - ( 389 ) Depreciation ( 1,741 ) ( 1,619 ) Amortization ( 1,131 ) ( 1,170 ) Loss from operations ( 169 ) ( 159 ) Interest income 24 5 Interest expense ( 568 ) ( 606 ) Loss before income taxes ( 713 ) ( 760 ) Income tax benefit (provision) ( 179 ) 216 Net loss $ ( 892 ) $ ( 544 ) |
Disaggregation Of Revenue By Category | The following table presents our revenue disaggregated by geographic region (in thousands). Quarter Ended November 30, November 30, 2020 2019 Americas $ 38,327 $ 44,036 Asia Pacific 3,191 10,139 Europe/Middle East/Africa 6,806 4,438 $ 48,324 $ 58,613 The following table presents our revenue disaggregated by type of service (in thousands). Quarter Ended Services and Leases and November 30, 2020 Products Subscriptions Royalties Other Consolidated Enterprise Division: Direct offices $ 19,412 $ 16,614 $ 717 $ - $ 36,743 International licensees 331 - 2,265 - 2,596 19,743 16,614 2,982 - 39,339 Education practice 1,924 5,075 499 - 7,498 Corporate and eliminations - - 335 1,152 1,487 Consolidated $ 21,667 $ 21,689 $ 3,816 $ 1,152 $ 48,324 Quarter Ended November 30, 2019 Enterprise Division: Direct offices $ 27,251 $ 14,288 $ 572 $ - $ 42,111 International licensees 590 - 3,131 - 3,721 27,841 14,288 3,703 - 45,832 Education practice 3,585 6,818 679 - 11,082 Corporate and eliminations - - 379 1,320 1,699 Consolidated $ 31,426 $ 21,106 $ 4,761 $ 1,320 $ 58,613 |
Inventories (Components Of Inve
Inventories (Components Of Inventories) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Inventories [Abstract] | ||
Finished goods | $ 2,647 | $ 2,947 |
Raw materials | 28 | 27 |
Inventories | $ 2,675 | $ 2,974 |
Receivables (Activity In Allowa
Receivables (Activity In Allowance For Doubtful Accounts) (Details) $ in Thousands | 3 Months Ended |
Nov. 30, 2020USD ($) | |
Receivables [Abstract] | |
Beginning balance | $ 4,159 |
Charged to costs and expenses | 247 |
Amounts written off | (655) |
Ending balance | $ 3,751 |
Fair Value Of Financial Instr_3
Fair Value Of Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands | Nov. 30, 2020 | Aug. 31, 2020 |
Contingent consideration | $ 3,616 | $ 3,883 |
Jhana [Member] | ||
Contingent consideration | 2,818 | $ 3,067 |
Jhana [Member] | Other Long-Term Liabilities [Member] | ||
Contingent consideration | 1,700 | |
Jhana And RGP [Member] | Accrued Liabilities [Member] | ||
Contingent consideration | $ 1,100 |
Fair Value Of Financial Instr_4
Fair Value Of Financial Instruments (Schedule Of Contingent Consideration Liability) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Business Acquisition, Contingent Consideration [Line Items] | ||
Contingent Liability at beginning | $ 3,883 | |
Change in fair value | 62 | $ 91 |
Payments | (329) | |
Contingent Liability at ending | 3,616 | |
Jhana [Member] | ||
Business Acquisition, Contingent Consideration [Line Items] | ||
Contingent Liability at beginning | 3,067 | |
Change in fair value | 80 | |
Payments | (329) | |
Contingent Liability at ending | 2,818 | |
RGP [Member] | ||
Business Acquisition, Contingent Consideration [Line Items] | ||
Contingent Liability at beginning | 816 | |
Change in fair value | (18) | |
Payments | ||
Contingent Liability at ending | $ 798 |
Revenue Recognition (Narrative)
Revenue Recognition (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2020 | Aug. 31, 2020 | |
Deferred revenue | $ 65.3 | $ 68.9 |
Other long-term liabilities | 2 | 2.2 |
Remaining performance obligations | 97.4 | |
Subscription [Member] | ||
Deferred revenue | 56.9 | $ 60.6 |
Deferred revenue recognized | $ 20.7 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) $ in Millions | Oct. 02, 2020USD ($)itemshares | Nov. 30, 2020USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares issued under terms of the award | 236,133 | |
Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of tranches | item | 2 | |
Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Price of common stock as a percent of the average fair market value | 85.00% | |
Shares issued to employee stock purchase plan participants | 15,097 | |
Common Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares withheld for tax | 88,704 | |
Shares withheld for tax, fair value | $ | $ 1.5 | |
Time-Based Award [Member] | Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of tranches | item | 1 | |
Performance-Based Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Service period | 2 years | |
Increase Adjusted EBITDA vesting target | $ | $ 2 | |
Tranche One [Member] | Time-Based Award [Member] | Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percent of shares plan participants are entitled to | 25.00% | |
Shares issued under terms of the award | 52,696 | |
Tranche Two and Three [Member] | Performance-Based Award [Member] | Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percent of performance-based objectives | 100.00% | |
Shares issued under terms of the award | 158,088 | |
Tranche Two and Three [Member] | Performance-Based Award [Member] | Minimum [Member] | Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percent of performance award to be granted | 50.00% | |
Tranche Two and Three [Member] | Performance-Based Award [Member] | Maximum [Member] | Fiscal 2021 Long Term Incentive Plan Award [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Percent of performance award to be granted | 200.00% | |
New shares granted | 316,176 |
Stock-Based Compensation (Total
Stock-Based Compensation (Total Cost Of Stock-Based Compensation) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost | $ 1,158 | $ 1,851 |
Long-Term Incentive Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost | 946 | 1,636 |
Restricted Stock Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost | 175 | 175 |
Employee Stock Purchase Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Compensation cost | $ 37 | $ 40 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Income Taxes [Abstract] | ||
Income tax expense | $ 179 | $ (216) |
Pre-tax loss | $ (713) | $ (760) |
Effective tax rate | 25.00% |
Loss Per Share (Narrative) (Det
Loss Per Share (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2020shares | |
Loss Per Share [Abstract] | |
Potentially dilutive securities were included in the calculation of diluted loss per share | 0 |
Number of dilutive stock options and other stock-based awards, shares | 112,000 |
Loss Per Share (Computation Of
Loss Per Share (Computation Of Loss Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Numerator for basic and diluted loss per share: | ||
Net loss | $ (892) | $ (544) |
Denominator for basic and diluted loss per share: | ||
Basic weighted average shares outstanding | 13,977 | 13,982 |
Effect of dilutive securities: | ||
Stock options and other stock-based awards | ||
Diluted weighted average shares outstanding | 13,977 | 13,982 |
EPS Calculations: | ||
Net loss per share: Basic and diluted | $ (0.06) | $ (0.04) |
Segment Information (Narrative)
Segment Information (Narrative) (Details) | 3 Months Ended |
Nov. 30, 2020itemsegment | |
Segment Information [Abstract] | |
Number of divisions | 2 |
Number of operating reportable segments | segment | 3 |
Number of corporate services group | 1 |
Segment Information (Schedule O
Segment Information (Schedule Of Segment Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Segment Reporting Information [Line Items] | ||
Sales to External Customers | $ 48,324 | $ 58,613 |
Gross Profit | 36,386 | 42,029 |
Adjusted EBITDA | 3,716 | 4,961 |
Corporate And Eliminations [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to External Customers | 1,487 | 1,699 |
Gross Profit | 676 | 841 |
Adjusted EBITDA | (1,986) | (1,682) |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Adjusted EBITDA | 5,702 | 6,643 |
Operating Segments [Member] | Enterprise Division [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to External Customers | 39,339 | 45,832 |
Gross Profit | 31,724 | 34,531 |
Adjusted EBITDA | 7,987 | 7,745 |
Operating Segments [Member] | Education Practice [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to External Customers | 7,498 | 11,082 |
Gross Profit | 3,986 | 6,657 |
Adjusted EBITDA | (2,285) | (1,102) |
Operating Segments [Member] | Direct Offices [Member] | Enterprise Division [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to External Customers | 36,743 | 42,111 |
Gross Profit | 29,439 | 31,411 |
Adjusted EBITDA | 6,693 | 5,710 |
Operating Segments [Member] | International Licensees [Member] | Enterprise Division [Member] | ||
Segment Reporting Information [Line Items] | ||
Sales to External Customers | 2,596 | 3,721 |
Gross Profit | 2,285 | 3,120 |
Adjusted EBITDA | $ 1,294 | $ 2,035 |
Segment Information (Reconcilia
Segment Information (Reconciliation Of Adjusted EBITDA) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Segment Reporting Information [Line Items] | ||
Consolidated Adjusted EBITDA | $ 3,716 | $ 4,961 |
Stock-based compensation | (1,158) | (1,851) |
Increase in the fair value of contingent consideration liabilities | (62) | (91) |
Government COVID-19 assistance | 207 | |
Knowledge Capital wind-down costs | (389) | |
Depreciation | (1,741) | (1,619) |
Amortization | (1,131) | (1,170) |
Loss from operations | (169) | (159) |
Interest income | 24 | 5 |
Interest expense | (568) | (606) |
Loss before income taxes | (713) | (760) |
Income tax benefit (provision) | (179) | 216 |
Net loss | (892) | (544) |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Consolidated Adjusted EBITDA | 5,702 | 6,643 |
Corporate And Eliminations [Member] | ||
Segment Reporting Information [Line Items] | ||
Consolidated Adjusted EBITDA | $ (1,986) | $ (1,682) |
Segment Information (Disaggrega
Segment Information (Disaggregation Of Revenue By Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 48,324 | $ 58,613 |
Americas [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 38,327 | 44,036 |
Asia Pacific [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,191 | 10,139 |
Europe/Middle East/Africa [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 6,806 | $ 4,438 |
Segment Information (Disaggre_2
Segment Information (Disaggregation Of Revenue By Type Of Service) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2020 | Nov. 30, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 48,324 | $ 58,613 |
Corporate And Eliminations [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,487 | 1,699 |
Services And Products [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 21,667 | 31,426 |
Subscriptions [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 21,689 | 21,106 |
Royalties [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 3,816 | 4,761 |
Royalties [Member] | Corporate And Eliminations [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 335 | 379 |
Leases And Other [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,152 | 1,320 |
Leases And Other [Member] | Corporate And Eliminations [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,152 | 1,320 |
Operating Segments [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 39,339 | 45,832 |
Operating Segments [Member] | Education Practice [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 7,498 | 11,082 |
Operating Segments [Member] | Direct Offices [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 36,743 | 42,111 |
Operating Segments [Member] | International Licensees [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,596 | 3,721 |
Operating Segments [Member] | Services And Products [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 19,743 | 27,841 |
Operating Segments [Member] | Services And Products [Member] | Education Practice [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,924 | 3,585 |
Operating Segments [Member] | Services And Products [Member] | Direct Offices [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 19,412 | 27,251 |
Operating Segments [Member] | Services And Products [Member] | International Licensees [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 331 | 590 |
Operating Segments [Member] | Subscriptions [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 16,614 | 14,288 |
Operating Segments [Member] | Subscriptions [Member] | Education Practice [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 5,075 | 6,818 |
Operating Segments [Member] | Subscriptions [Member] | Direct Offices [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 16,614 | 14,288 |
Operating Segments [Member] | Royalties [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 2,982 | 3,703 |
Operating Segments [Member] | Royalties [Member] | Education Practice [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 499 | 679 |
Operating Segments [Member] | Royalties [Member] | Direct Offices [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 717 | 572 |
Operating Segments [Member] | Royalties [Member] | International Licensees [Member] | Enterprise Division [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 2,265 | $ 3,131 |