Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2017 | May 02, 2017 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | SHARPS COMPLIANCE CORP | |
Entity Central Index Key | 898,770 | |
Current Fiscal Year End Date | --06-30 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 16,006,157 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 5,692 | $ 12,435 |
Accounts receivable, net of allowance for doubtful accounts of $74 and $63, respectively | 5,191 | 5,814 |
Inventory, net | 4,526 | 3,919 |
Prepaid and other current assets | 853 | 695 |
TOTAL CURRENT ASSETS | 16,262 | 22,863 |
PROPERTY, PLANT AND EQUIPMENT, net | 6,756 | 5,032 |
OTHER ASSETS | 118 | 84 |
GOODWILL | 6,724 | 1,039 |
INTANGIBLE ASSETS, net of accumulated amortization of $954 and $502, respectively | 4,162 | 1,129 |
TOTAL ASSETS | 34,022 | 30,147 |
CURRENT LIABILITIES | ||
Accounts payable | 2,469 | 1,620 |
Accrued liabilities | 1,340 | 1,534 |
Current maturities of long-term debt | 604 | 0 |
Deferred revenue | 2,223 | 2,477 |
TOTAL CURRENT LIABILITIES | 6,636 | 5,631 |
LONG-TERM DEFERRED REVENUE, net of current portion | 498 | 483 |
OTHER LONG-TERM LIABILITIES | 166 | 190 |
LONG-TERM DEBT, net of current portion | 2,121 | 0 |
TOTAL LIABILITIES | 9,421 | 6,304 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY | ||
Common stock, $0.01 par value per share; 20,000,000 shares authorized;16,301,722 and 15,740,458 shares issued, respectively and 16,006,157 and 15,444,843 shares outstanding, respectively | 163 | 158 |
Treasury stock, at cost, 295,615 shares repurchased | (1,554) | (1,554) |
Additional paid-in capital | 27,946 | 25,331 |
Accumulated deficit | (1,954) | (92) |
TOTAL STOCKHOLDERS' EQUITY | 24,601 | 23,843 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 34,022 | $ 30,147 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
CURRENT ASSETS | ||
Accounts receivable, allowance for doubtful accounts | $ 74 | $ 63 |
INTANGIBLE ASSETS, accumulated amortization | $ 954 | $ 502 |
STOCKHOLDERS' EQUITY | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 16,301,722 | 15,740,458 |
Common stock, shares outstanding (in shares) | 16,006,157 | 15,444,843 |
Treasury stock, shares repurchased (in shares) | 295,615 | 295,615 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||||
REVENUES | $ 8,588 | $ 6,652 | $ 27,826 | $ 24,513 |
Cost of revenues | 6,236 | 4,959 | 19,620 | 16,622 |
GROSS PROFIT | 2,352 | 1,693 | 8,206 | 7,891 |
Selling, general and administrative | 2,790 | 2,709 | 9,388 | 7,890 |
Depreciation and amortization | 200 | 88 | 600 | 210 |
OPERATING LOSS | (638) | (1,104) | (1,782) | (209) |
OTHER INCOME (EXPENSE) | ||||
Interest income | 4 | 8 | 12 | 26 |
Interest expense | (34) | 0 | (92) | 0 |
TOTAL OTHER (EXPENSE) INCOME | (30) | 8 | (80) | 26 |
LOSS BEFORE INCOME TAXES | (668) | (1,096) | (1,862) | (183) |
TOTAL INCOME TAX BENEFIT | 0 | (54) | 0 | 24 |
NET LOSS | $ (668) | $ (1,042) | $ (1,862) | $ (207) |
NET LOSS PER COMMON SHARE | ||||
Basic and Diluted (in dollars per share) | $ (0.04) | $ (0.07) | $ (0.12) | $ (0.01) |
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET LOSS PER COMMON SHARE: | ||||
Basic and Diluted (in shares) | 15,994 | 15,462 | 15,930 | 15,449 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total |
Balances at Jun. 30, 2015 | $ 156 | $ (809) | $ 24,344 | $ (105) | $ 23,586 |
Balances (in shares) at Jun. 30, 2015 | 15,575,041 | (191,250) | |||
Exercise of stock options | $ 1 | $ 0 | 312 | 0 | 313 |
Exercise of stock options (in shares) | 112,425 | 0 | |||
Stock-based compensation | $ 0 | $ 0 | 676 | 0 | 676 |
Issuance of restricted stock | $ 1 | 0 | (1) | 0 | 0 |
Issuance of restricted stock (in shares) | 52,992 | ||||
Shares repurchased | $ 0 | $ (745) | 0 | 0 | (745) |
Shares repurchased (in shares) | (104,365) | ||||
Net income (loss) | 0 | $ 0 | 0 | 13 | 13 |
Balances at Jun. 30, 2016 | $ 158 | $ (1,554) | 25,331 | (92) | $ 23,843 |
Balances (in shares) at Jun. 30, 2016 | 15,740,458 | (295,615) | 15,444,843 | ||
Exercise of stock options | $ 0 | $ 0 | 342 | 0 | $ 342 |
Exercise of stock options (in shares) | 95,050 | 0 | 95,050 | ||
Stock-based compensation | $ 0 | $ 0 | 389 | 0 | $ 389 |
Issuance of restricted stock | $ 1 | 0 | (1) | 0 | 0 |
Issuance of restricted stock (in shares) | 52,992 | ||||
Issuance of common stock for acquisition | $ 4 | $ 0 | 1,885 | 0 | $ 1,889 |
Issuance of common stock for acquisition (in shares) | 413,272 | 0 | |||
Shares repurchased (in shares) | 0 | ||||
Net income (loss) | $ 0 | $ 0 | 0 | (1,862) | $ (1,862) |
Balances at Mar. 31, 2017 | $ 163 | $ (1,554) | $ 27,946 | $ (1,954) | $ 24,601 |
Balances (in shares) at Mar. 31, 2017 | 16,301,772 | (295,615) | 16,006,157 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (1,862) | $ (207) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 1,100 | 601 |
Loss on disposal of property, plant and equipment | 10 | 0 |
Stock-based compensation expense | 389 | 510 |
Changes in operating assets and liabilities, net of effects of business acquisitions: | ||
Accounts receivable | 1,118 | 2,764 |
Inventory | (477) | (1,285) |
Prepaid and other assets | (192) | (79) |
Accounts payable and accrued liabilities | 335 | (1,122) |
Deferred revenue | (239) | 308 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 182 | 1,490 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property, plant and equipment | (2,439) | (1,217) |
Cash proceeds from sale of property, plant and equipment | 23 | 0 |
Additions to intangible assets | (128) | 0 |
Payments for business acquisitions, net of cash acquired | (7,261) | (1,552) |
NET CASH USED IN INVESTING ACTIVITIES | (9,805) | (2,769) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from exercise of stock options | 342 | 313 |
Shares repurchased | 0 | (745) |
Proceeds from long-term debt | 5,600 | 0 |
Repayments of long-term debt | (3,062) | 0 |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 2,880 | (432) |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (6,743) | (1,711) |
CASH AND CASH EQUIVALENTS, beginning of period | 12,435 | 15,157 |
CASH AND CASH EQUIVALENTS, end of period | 5,692 | 13,446 |
SUPPLEMENTAL CASH FLOW DISCLOSURES: | ||
Income taxes paid | 0 | 143 |
Interest paid on long-term debt | 91 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Issuance of common stock for acquisition | 1,889 | 0 |
Unpaid consideration related to acquisitions | 52 | 181 |
Transfer of equipment to inventory | 130 | 114 |
Property, plant and equipment financed through accounts payable | $ 66 | $ 0 |
ORGANIZATION AND BACKGROUND
ORGANIZATION AND BACKGROUND | 9 Months Ended |
Mar. 31, 2017 | |
ORGANIZATION AND BACKGROUND [Abstract] | |
ORGANIZATION AND BACKGROUND | NOTE 1 - ORGANIZATION AND BACKGROUND Organization Business ® ® SM ® ® . |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Mar. 31, 2017 | |
BASIS OF PRESENTATION [Abstract] | |
BASIS OF PRESENTATION | NOTE 2 - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information and with instructions to Form 10-Q and, accordingly, do not include all information and footnotes required under accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, these interim condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the consolidated financial position of the Company as of March 31, 2017, the results of its operations for the three and nine months ended March 31, 2017 and 2016, cash flows for the nine months ended March 31, 2017 and 2016 and stockholders’ equity for the nine months ended March 31, 2017. The results of operations for the three and nine months ended March 31, 2017 are not necessarily indicative of the results to be expected for the entire fiscal year ending June 30, 2017. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended June 30, 2016. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Mar. 31, 2017 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES Revenue Recognition The Company recognizes revenue when services are provided and from product sales when (i) goods are shipped or delivered, and title and risk of loss pass to the customer, (ii) the price is substantially fixed or determinable and (iii) collectability is reasonably assured except for those sales via multiple-deliverable revenue arrangements. Provisions for certain rebates, product returns and discounts to customers are accounted for as reductions in sales in the same period the related sales are recorded. Product discounts granted are based on the terms of arrangements with direct, indirect and other market participants, as well as market conditions, including prices charged by competitors. Rebates are estimated based on contractual terms, historical experience, trend analysis and projected market conditions in the various markets served. Service agreements which include a vendor managed inventory program include terms that meet the “bill and hold” criteria and as such are recognized when the order is completed, at which point title has transferred, there are no acceptance provisions and amounts are segregated in the Company’s warehouse. During the three and nine months ended March 31, 2017, the Company recorded revenue from inventory builds that are held in vendor managed inventory under these service agreements of $0.7 million and $2.5 million, respectively. During the three and nine months ended March 31, 2016, the Company recorded revenue from inventory builds that are held in vendor managed inventory under these service agreements of $0.4 million and $2.7 million, respectively. As of March 31, 2017 and June 30, 2016, $2.6 million and $2.1 million, respectively, of solutions sold through that date were held in vendor managed inventory pending fulfillment or shipment to patients of pharmaceutical manufacturers who offer these solutions to patients in an ongoing patient support program. Certain products offered by the Company have revenue producing components that are recognized over multiple delivery points (Sharps Recovery System and various other solutions like the TakeAway Medication Recovery Systems referred to as “Mailbacks” and Sharps Pump and Asset Return Systems, referred to as “Pump Returns”) and can consist of up to three separate elements, or units of measure, as follows: (1) the sale of the compliance and container system, (2) return transportation and (3) treatment service. In accordance with the relative selling price methodology, an estimated selling price is determined for all deliverables that qualify for separate units of accounting. The actual consideration received in a multiple-deliverable arrangement is then allocated to the units based on their relative sales price. The selling price for the transportation revenue and the treatment revenue utilizes third party evidence. The Company estimates the selling price of the compliance and container system based on the product and services provided, including compliance with local, state and federal laws, adherence to stringent manufacturing and testing requirements, safety to the patient and the community as well as storage and containment capabilities. Revenue for the sale of the compliance and container is recognized upon delivery to the customer, at which time the customer takes title and assumes risk of ownership. Transportation revenue is recognized when the customer returns the compliance and container system and the container has been received at the Company’s owned or contracted facilities. The compliance and container system is mailed or delivered by an alternative logistics provider to the Company’s owned or contracted facilities. Treatment revenue is recognized upon the destruction or conversion and proof of receipt and treatment having been performed on the container. Since the transportation element and the treatment elements are undelivered services at the point of initial sale of the compliance and container, transportation and treatment revenue is deferred until the services are performed. The current and long-term portions of deferred revenues are determined through regression analysis and historical trends. Furthermore, through regression analysis of historical data, the Company has determined that a certain percentage of all compliance and container systems sold may not be returned. Accordingly, a portion of the transportation and treatment elements are recognized at the point of sale. Business Combinations Income Taxes Accounts Receivable Stock-Based Compensation Fair Value of Financial Instruments Fair Value Measurements · Level 1 – Quoted prices in active markets for identical assets or liabilities. · Level 2 – Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities). · Level 3 – Significant unobservable inputs (including our own assumptions in determining fair value). We use the cost, income or market valuation approaches to estimate the fair value of our assets and liabilities when insufficient market-observable data is available to support our valuation assumptions. The purchase price allocations relating to the acquisitions completed during the nine months ended March 31, 2017 and 2016 utilized level 3 inputs. |
RECENTLY ISSUED ACCOUNTING STAN
RECENTLY ISSUED ACCOUNTING STANDARDS | 9 Months Ended |
Mar. 31, 2017 | |
RECENTLY ISSUED ACCOUNTING STANDARDS [Abstract] | |
RECENTLY ISSUED ACCOUNTING STANDARDS | NOTE 4 – RECENTLY ISSUED ACCOUNTING STANDARDS In May 2014, guidance for revenue recognition was issued which supersedes the revenue recognition requirements currently followed by the Company. The new guidance provides for a single five-step model to be applied in determining the amount and timing of the recognition of revenue related to contracts with customers. The new standard also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance is effective for annual reporting periods beginning after December 15, 2017 (effective July 1, 2018 for the Company.) The Company is in the initial stages of evaluating the impact that the new accounting guidance will have on its consolidated financial statements and related disclosures as well as evaluating the available transition methods. The Company will continue to evaluate the standard as well as additional changes, modifications or interpretations which may impact the Company. In July 2015, guidance for inventory measurement was issued, which supersedes the policy currently followed by the Company. The new guidance requires the Company to measure inventory at the lower of cost and net realizable value. The provisions of the new guidance are effective for annual reporting periods beginning after December 15, 2016 (effective July 1, 2017 for the Company) including interim periods within that reporting period. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements. In February 2016, guidance for leases was issued, which requires balance sheet recognition for rights and obligations of all leases with terms in excess of twelve months. The new guidance also requires additional disclosures about the amount, timing and uncertainty of cash flows arising from leases. The provisions of the new guidance are effective for annual periods beginning after December 15, 2018 (effective July 1, 2019 for the Company), including interim periods within the reporting period, and early application is permitted. evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. In March 2016, new guidance for stock-based compensation was issued, which simplifies the accounting for stock-based compensation related to income taxes and balance sheet and cash flow classifications. In addition, an entity can make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. The provisions of the new guidance are effective for annual reporting periods beginning after December 15, 2016 (effective July 1, 2017 for the Company) including interim periods within the reporting period. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Mar. 31, 2017 | |
INCOME TAXES [Abstract] | |
INCOME TAXES | NOTE 5 - INCOME TAXES The establishment of valuation allowances requires significant judgment and is impacted by various estimates. Both positive and negative evidence, as well as the objectivity and verifiability of that evidence, is considered in determining the appropriateness of recording a valuation allowance on deferred tax assets. Under generally accepted accounting principles, the valuation allowance has been recorded to reduce the Company’s net deferred tax asset to an amount that is more likely than not to be realized and is based upon the uncertainty of the realization of certain federal and state deferred tax assets related to net operating loss carryforwards and other tax attributes. The Company’s net deferred tax assets have been fully reserved by a tax valuation allowance. No income tax expense was recorded for the nine months ended March 31, 2017 as it was not material due to the valuation allowance and net operating losses. The Company’s effective tax rate for the nine months ended March 31, 2016 was 13.1% reflecting estimated state income taxes. The Company’s tax benefit associated with taxable losses during the nine months ended March 31, 2017 was offset by a deferred tax valuation allowance. The Company’s tax expense associated with taxable income during the nine months ended March 31, 2016 was offset by the utilization of net operating loss carryforwards. |
NOTES PAYABLE AND LONG-TERM DEB
NOTES PAYABLE AND LONG-TERM DEBT | 9 Months Ended |
Mar. 31, 2017 | |
NOTES PAYABLE AND LONG-TERM DEBT [Abstract] | |
NOTES PAYABLE AND LONG-TERM DEBT | NOTE 6 - NOTES PAYABLE AND LONG-TERM DEBT On March 29, 2017, the Company entered into to a credit agreement with a commercial bank (“Credit Agreement”). The Credit Agreement, which replaced the Company’s prior credit agreement which was executed effective April 9, 2015 with another commercial bank, provides for a $14.0 million line of credit facility, the proceeds of which may be utilized as follows: (i) $6.0 million for working capital, letters of credit (up to $2.0 million) and general corporate purposes and (ii) $8.0 million for acquisitions. Indebtedness under the Credit Agreement is secured by the Company’s accounts receivable and inventory with advances outstanding under the working capital portion of the credit facility at any time limited to a Borrowing Base (as defined in the Credit Agreement) equal to 80% of eligible accounts receivable plus 50% of eligible inventory. Advances under the acquisition portion of the credit facility are limited to 75% of the purchase price of an acquired company and convert to a five-year term note. Borrowings bear interest at the greater of (a) zero percent or (b) the One Month ICE LIBOR plus a LIBOR Margin of 2.5%. The LIBOR Margin may increase to as high as 3.0% after September 30, 2017 depending on the Company’s cash flow leverage ratio. The interest rate as of March 31, 2017 was approximately 3.48%. The Company pays a fee of 0.25% per annum on the unused amount of the line of credit. At March 31, 2017, long-term debt consisted of the following (in thousands): Non-interest bearing, unsecured note payable assumed in acquisition (See Note 13), monthly payments of $7; maturing September 2018. $ 125 Term loan, bearing interest at 3.48%, monthly payments of $43; maturing March 2022. 2,600 Total long-term debt 2,725 Less: current portion 604 Long-term debt, net of current portion $ 2,121 The Company’s availability under its credit facilities is currently approximately $11.4 million ($6.0 million for the working capital and $5.4 million for the acquisitions). The Credit Agreement contains affirmative and negative covenants that, among other things, require the Company to maintain, beginning with the twelve-month period ending September 30, 2017, a maximum cash flow leverage ratio of no more than 3.5 to 1.0 and a minimum debt service coverage ratio of not less than 1.15 to 1.00. The maximum cash flow leverage ratio decreases to 3.25 to 1.0 on December 31, 2017 and to 3.0 to 1.0 on March 31, 2018. The Credit Agreement, which expires on March 29, 2019, also contains customary events of default which, if uncured, may terminate the Credit Agreement and require immediate repayment of all indebtedness to the lenders. Payments due on long-term debt during each of the five years subsequent to March 31, 2017 are as follows (in thousands): Twelve Months Ending March 31, 2018 $ 604 2019 561 2020 520 2021 520 2022 520 $ 2,725 The Prior Credit Agreement, which was effective through March 29, 2017, provided for a $9.0 million line of credit facility with a maturity date of April 9, 2018. No amounts related to the Prior Credit Agreement were outstanding as of March 31, 2017 other than letters of credit of approximately $0.3 million, which are in the process of being released. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 9 Months Ended |
Mar. 31, 2017 | |
STOCK-BASED COMPENSATION [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 7 – STOCK-BASED COMPENSATION Stock-based compensation cost for options and restricted stock awarded to employees and directors is measured at the grant date, based on the calculated fair value of the award and is recognized as an expense over the requisite service period (generally the vesting period of the equity grant). During the three and nine months ended March 31, 2017 and 2016, stock-based compensation amounts are as follows (in thousands): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Stock-based compensation expense included in: Cost of revenues $ 8 $ 7 $ 33 $ 25 Selling, general and administrative 108 145 356 485 Total $ 116 $ 152 $ 389 $ 510 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Mar. 31, 2017 | |
EARNINGS PER SHARE [Abstract] | |
EARNINGS PER SHARE | NOTE 8 - EARNINGS PER SHARE Basic earnings per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income (loss) by the weighted average number of common shares after considering the additional dilution related to common stock options and restricted stock. In computing diluted earnings per share, the outstanding common stock options are considered dilutive using the treasury stock method. The Company’s restricted stock awards and escrow shares that were issued in connection with the Citiwaste acquisition are treated as outstanding for earnings per share calculations since these shares have full voting rights and are entitled to participate in dividends declared on common shares, if any, and undistributed earnings. As participating securities, the shares of restricted stock are included in the calculation of basic EPS using the two-class method. For the periods presented, the amount of earnings allocated to the participating securities was not material. The following information is necessary to calculate earnings per share for the periods presented (in thousands, except per-share data): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Net loss, as reported $ (668 ) $ (1,042 ) $ (1,862 ) $ (207 ) Weighted average common shares outstanding 15,994 15,462 15,930 15,449 Net loss per common share Basic and diluted $ (0.04 ) $ (0.07 ) $ (0.12 ) $ (0.01 ) Employee stock options excluded from computation of dilutive income per share amounts because their effect would be anti-dilutive 269 137 304 96 |
EQUITY TRANSACTIONS
EQUITY TRANSACTIONS | 9 Months Ended |
Mar. 31, 2017 | |
EQUITY TRANSACTIONS [Abstract] | |
EQUITY TRANSACTIONS | NOTE 9 - EQUITY TRANSACTIONS During the three and nine months ended March 31, 2017 and 2016, stock options to purchase shares of the Company’s common stock were exercised as follows: Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Options Exercised 19,300 - 95,050 112,425 Proceeds (in thousands) $ 84 $ - $ 342 $ 313 Average exercise price per share $ 4.34 $ - $ 3.60 $ 2.77 As of March 31, 2017, there was $0.4 million of stock option and restricted stock compensation expense related to non-vested awards which is expected to be recognized over a weighted average period of 1.77 years. On January 7, 2013, the Company announced that its Board of Directors approved a stock repurchase program effective January 3, 2013, authorizing the Company to repurchase in the aggregate up to $3.0 million of its outstanding common stock over a two-year period. On March 5, 2015, the Board approved a two-year extension on the stock repurchase program through January 1, 2017. During the three and nine months ended March 31, 2017 and 2016, shares were repurchased as follows: Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Shares repurchased - 36,343 - 104,365 Cash paid for shares repurchased (in thousands) $ - $ 205 $ - $ 745 Average price paid per share $ - $ 5.64 $ - $ 7.14 Total shares repurchased under the program are 295,615 shares at a cost of $1.6 million. As of January 1, 2017, approximately $1.4 million remained of the Company’s $3.0 million repurchase program. The program has not been extended. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Mar. 31, 2017 | |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 10 – GOODWILL AND INTANGIBLE ASSETS At March 31, 2017 and June 30, 2016, intangible assets consisted of the following (in thousands): March 31, 2017 June 30, 2016 Estimated Useful Lives Original Amount Accumulated Amortization Net Amount Original Amount Accumulated Amortization Net Amount Customer relationships 7 years $ 3,007 $ (382 ) $ 2,625 $ 580 $ (60 ) $ 520 Permits 6 - 15 years 1,339 (264 ) 1,075 668 (191 ) 477 Patents 5 - 17 years 383 (261 ) 122 383 (251 ) 132 Tradename 7 years 270 (29 ) 241 - - - Non-compete 5 years 117 (18 ) 99 - - - Total intangible assets, net $ 5,116 $ (954 ) $ 4,162 $ 1,631 $ (502 ) $ 1,129 During the nine months ended March 31, 2017 and 2016, amortization expense was $0.5 million and $0.1 million, respectively. The changes in the carrying amount of goodwill since June 30, 2016 was as follows (in thousands): Balance at June 30, 2016 $ 1,039 Goodwill acquired during the nine months ended March 31, 2017 5,685 Balance at March 31, 2017 $ 6,724 As of March 31, 2017, future amortization of intangible assets is as follows (in thousands): Twelve Months Ending March 31, 2018 611 2019 611 2020 611 2021 611 2022 593 Thereafter 1,125 $ 4,162 |
INVENTORY
INVENTORY | 9 Months Ended |
Mar. 31, 2017 | |
INVENTORY [Abstract] | |
INVENTORY | NOTE 11 – INVENTORY The components of inventory are as follows (in thousands): March 31, 2017 June 30, 2016 Raw materials $ 1,458 1,388 Finished goods 3,068 2,531 Total $ 4,526 3,919 |
REVENUES BY SOLUTION
REVENUES BY SOLUTION | 9 Months Ended |
Mar. 31, 2017 | |
REVENUES BY SOLUTION [Abstract] | |
REVENUES BY SOLUTION | NOTE 12 – REVENUES BY SOLUTION The components of revenues by solution are as follows (in thousands): Three-Months Ended March 31, 2017 % Total 2016 % Total REVENUES BY SOLUTION: Mailbacks $ 4,997 58.2 % $ 4,308 64.8 % Route-based pickup services 1,641 19.1 % 628 9.4 % Unused medications 867 10.1 % 707 10.6 % Third party treatment services 149 1.7 % 70 1.1 % Other (1) 934 10.9 % 939 14.1 % Total revenues $ 8,588 100.0 % $ 6,652 100.0 % Nine-Months Ended March 31, 2017 % Total 2016 % Total REVENUES BY SOLUTION: Mailbacks $ 17,661 63.5 % $ 17,246 70.4 % Route-based pickup services 4,686 16.8 % 1,469 6.0 % Unused medications 2,400 8.6 % 2,743 11.2 % Third party treatment services 291 1.0 % 224 0.9 % Other (1) 2,788 10.1 % 2,831 11.5 % Total revenues $ 27,826 100.0 % $ 24,513 100.0 % (1) The Company’s other products include non-mailback products such as IV poles, accessories, containers, asset return boxes and other miscellaneous items. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended |
Mar. 31, 2017 | |
ACQUISITIONS [Abstract] | |
ACQUISITIONS | NOTE 13 – ACQUISITIONS Effective on July 17, 2015, the Company acquired Alpha Bio/Med Services LLC, a route-based pickup service located in Pennsylvania for total cash consideration of $0.7 million of which $0.1 million was withheld for payment of adjusted escrow amounts which settled in July 2016. The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Accounts receivable $ 51 Fixed assets 70 Intangibles 267 Goodwill 413 Accounts payable and accrued liabilities (101 ) Total purchase price $ 700 Effective on December 14, 2015, the Company acquired Bio-Team Mobile LLC, a route-based pickup service located in Pennsylvania for total cash consideration of $1.0 million of which $0.1 million was withheld for payment of adjusted escrow amounts which settled in January 2017. The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Accounts receivable $ 42 Fixed assets 68 Intangibles 313 Goodwill 626 Accounts payable and accrued liabilities (16 ) Total purchase price $ 1,033 Effective July 1, 2016, the Company acquired Citiwaste, LLC (“Citiwaste”), a route-based pickup service located in New York, which is in the business of medical, pharmaceutical and hazardous waste management primarily in the healthcare industry. The purchase price consists of $7.0 million in cash ($3.0 million of which was borrowed under the acquisition portion of its Credit Agreement), 413,272 shares of common stock of the Company (the “Common Stock Consideration”) valued at $1.9 million, which constitutes approximately 3.0% of the total outstanding shares of common stock of the Company, and a lease obligation to be paid to the seller for $0.1 million which is presented on the balance sheet in accrued liabilities for a total consideration of $9.0 million. The issuance of the Common Stock Consideration was not registered under the Securities Act of 1933, as amended, and was issued pursuant to an exemption from the registration requirements thereunder. The Company will hold 139,216 shares of the Common Stock Consideration in escrow for a one-year period to cover the indemnification obligations of the Sellers under the Agreement. For the three and nine months ended March 31, 2017, the Company recognized approximately $0.9 million and $2.6 million in revenues related to the operations of Citiwaste, respectively. The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Cash $ 5 Accounts receivable 495 Fixed assets 30 Intangibles 3,357 Goodwill 5,685 Accounts payable and accrued liabilities (356 ) Debt assumed (187 ) Total purchase price $ 9,029 During the three and nine months ended March 31, 2017 and 2016, the Company incurred acquisition related expenses for investment banking, legal and accounting fees which are included within selling, general and administrative expenses in the condensed consolidated statements of operations as follows (in thousands): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Acquisition-related expenses $ - $ - $ 702 $ 151 The results of operations of the acquired business have been included in the condensed consolidated statements of operations from the date of acquisition. Pro forma results of operations for Alpha Bio/Med Services and Bio-Team Mobile are not presented because the pro forma effects, individually or in the aggregate, were not material to the Company’s consolidated results of operations. The goodwill recorded for the Alpha Bio/Med Services, Bio-Team Mobile, and Citiwaste acquisitions will be deductible for income taxes. The goodwill recognized for the acquisitions since July 1, 2015 is attributable to expected revenue synergies generated by the integration of our products and services with those acquisitions, cost synergies resulting from the consolidation or elimination of certain functions, and intangible assets that do not qualify for separate recognition such as the assembled workforce of each acquisition. Supplemental Pro Forma Data Citiwaste’s financial results have been included in our condensed consolidated financial results for the three and nine months ended March 31, 2017. The following table presents summarized unaudited pro forma financial information as if the Citiwaste acquisition occurred on July 1, 2015 (in thousands, except per-share data): Three-Months Ended March 31, Nine-Months Ended March 31, 2016 2016 Revenues $ 7,383 $ 26,705 Net loss $ (1,085 ) $ (336 ) Weighted average common shares outstanding 15,875 15,862 Net loss per common share basic and diluted $ (0.07 ) $ (0.02 ) |
SIGNIFICANT ACCOUNTING POLICI20
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Mar. 31, 2017 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when services are provided and from product sales when (i) goods are shipped or delivered, and title and risk of loss pass to the customer, (ii) the price is substantially fixed or determinable and (iii) collectability is reasonably assured except for those sales via multiple-deliverable revenue arrangements. Provisions for certain rebates, product returns and discounts to customers are accounted for as reductions in sales in the same period the related sales are recorded. Product discounts granted are based on the terms of arrangements with direct, indirect and other market participants, as well as market conditions, including prices charged by competitors. Rebates are estimated based on contractual terms, historical experience, trend analysis and projected market conditions in the various markets served. Service agreements which include a vendor managed inventory program include terms that meet the “bill and hold” criteria and as such are recognized when the order is completed, at which point title has transferred, there are no acceptance provisions and amounts are segregated in the Company’s warehouse. During the three and nine months ended March 31, 2017, the Company recorded revenue from inventory builds that are held in vendor managed inventory under these service agreements of $0.7 million and $2.5 million, respectively. During the three and nine months ended March 31, 2016, the Company recorded revenue from inventory builds that are held in vendor managed inventory under these service agreements of $0.4 million and $2.7 million, respectively. As of March 31, 2017 and June 30, 2016, $2.6 million and $2.1 million, respectively, of solutions sold through that date were held in vendor managed inventory pending fulfillment or shipment to patients of pharmaceutical manufacturers who offer these solutions to patients in an ongoing patient support program. Certain products offered by the Company have revenue producing components that are recognized over multiple delivery points (Sharps Recovery System and various other solutions like the TakeAway Medication Recovery Systems referred to as “Mailbacks” and Sharps Pump and Asset Return Systems, referred to as “Pump Returns”) and can consist of up to three separate elements, or units of measure, as follows: (1) the sale of the compliance and container system, (2) return transportation and (3) treatment service. In accordance with the relative selling price methodology, an estimated selling price is determined for all deliverables that qualify for separate units of accounting. The actual consideration received in a multiple-deliverable arrangement is then allocated to the units based on their relative sales price. The selling price for the transportation revenue and the treatment revenue utilizes third party evidence. The Company estimates the selling price of the compliance and container system based on the product and services provided, including compliance with local, state and federal laws, adherence to stringent manufacturing and testing requirements, safety to the patient and the community as well as storage and containment capabilities. Revenue for the sale of the compliance and container is recognized upon delivery to the customer, at which time the customer takes title and assumes risk of ownership. Transportation revenue is recognized when the customer returns the compliance and container system and the container has been received at the Company’s owned or contracted facilities. The compliance and container system is mailed or delivered by an alternative logistics provider to the Company’s owned or contracted facilities. Treatment revenue is recognized upon the destruction or conversion and proof of receipt and treatment having been performed on the container. Since the transportation element and the treatment elements are undelivered services at the point of initial sale of the compliance and container, transportation and treatment revenue is deferred until the services are performed. The current and long-term portions of deferred revenues are determined through regression analysis and historical trends. Furthermore, through regression analysis of historical data, the Company has determined that a certain percentage of all compliance and container systems sold may not be returned. Accordingly, a portion of the transportation and treatment elements are recognized at the point of sale. |
Business Combinations | Business Combinations |
Income Taxes | Income Taxes |
Accounts Receivable | Accounts Receivable |
Stock-Based Compensation | Stock-Based Compensation |
Fair Value of Financial Instruments | Fair Value of Financial Instruments |
Fair Value Measurements | Fair Value Measurements · Level 1 – Quoted prices in active markets for identical assets or liabilities. · Level 2 – Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities). · Level 3 – Significant unobservable inputs (including our own assumptions in determining fair value). We use the cost, income or market valuation approaches to estimate the fair value of our assets and liabilities when insufficient market-observable data is available to support our valuation assumptions. The purchase price allocations relating to the acquisitions completed during the nine months ended March 31, 2017 and 2016 utilized level 3 inputs. |
RECENTLY ISSUED ACCOUNTING ST21
RECENTLY ISSUED ACCOUNTING STANDARDS (Policies) | 9 Months Ended |
Mar. 31, 2017 | |
RECENTLY ISSUED ACCOUNTING STANDARDS [Abstract] | |
Recently issued accounting standards | In May 2014, guidance for revenue recognition was issued which supersedes the revenue recognition requirements currently followed by the Company. The new guidance provides for a single five-step model to be applied in determining the amount and timing of the recognition of revenue related to contracts with customers. The new standard also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance is effective for annual reporting periods beginning after December 15, 2017 (effective July 1, 2018 for the Company.) The Company is in the initial stages of evaluating the impact that the new accounting guidance will have on its consolidated financial statements and related disclosures as well as evaluating the available transition methods. The Company will continue to evaluate the standard as well as additional changes, modifications or interpretations which may impact the Company. In July 2015, guidance for inventory measurement was issued, which supersedes the policy currently followed by the Company. The new guidance requires the Company to measure inventory at the lower of cost and net realizable value. The provisions of the new guidance are effective for annual reporting periods beginning after December 15, 2016 (effective July 1, 2017 for the Company) including interim periods within that reporting period. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements. In February 2016, guidance for leases was issued, which requires balance sheet recognition for rights and obligations of all leases with terms in excess of twelve months. The new guidance also requires additional disclosures about the amount, timing and uncertainty of cash flows arising from leases. The provisions of the new guidance are effective for annual periods beginning after December 15, 2018 (effective July 1, 2019 for the Company), including interim periods within the reporting period, and early application is permitted. evaluating the impact of the new guidance on its consolidated financial statements and related disclosures. In March 2016, new guidance for stock-based compensation was issued, which simplifies the accounting for stock-based compensation related to income taxes and balance sheet and cash flow classifications. In addition, an entity can make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. The provisions of the new guidance are effective for annual reporting periods beginning after December 15, 2016 (effective July 1, 2017 for the Company) including interim periods within the reporting period. The adoption of this guidance is not expected to have a material effect on the Company’s consolidated financial statements. |
NOTES PAYABLE AND LONG-TERM D22
NOTES PAYABLE AND LONG-TERM DEBT (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
NOTES PAYABLE AND LONG-TERM DEBT [Abstract] | |
Schedule of long-term debt | At March 31, 2017, long-term debt consisted of the following (in thousands): Non-interest bearing, unsecured note payable assumed in acquisition (See Note 13), monthly payments of $7; maturing September 2018. $ 125 Term loan, bearing interest at 3.48%, monthly payments of $43; maturing March 2022. 2,600 Total long-term debt 2,725 Less: current portion 604 Long-term debt, net of current portion $ 2,121 |
Schedule of payments due on long-term debt | Payments due on long-term debt during each of the five years subsequent to March 31, 2017 are as follows (in thousands): Twelve Months Ending March 31, 2018 $ 604 2019 561 2020 520 2021 520 2022 520 $ 2,725 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
STOCK-BASED COMPENSATION [Abstract] | |
Allocated cost of stock-based compensation | During the three and nine months ended March 31, 2017 and 2016, stock-based compensation amounts are as follows (in thousands): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Stock-based compensation expense included in: Cost of revenues $ 8 $ 7 $ 33 $ 25 Selling, general and administrative 108 145 356 485 Total $ 116 $ 152 $ 389 $ 510 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
EARNINGS PER SHARE [Abstract] | |
Earnings per share | The following information is necessary to calculate earnings per share for the periods presented (in thousands, except per-share data): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Net loss, as reported $ (668 ) $ (1,042 ) $ (1,862 ) $ (207 ) Weighted average common shares outstanding 15,994 15,462 15,930 15,449 Net loss per common share Basic and diluted $ (0.04 ) $ (0.07 ) $ (0.12 ) $ (0.01 ) Employee stock options excluded from computation of dilutive income per share amounts because their effect would be anti-dilutive 269 137 304 96 |
EQUITY TRANSACTIONS (Tables)
EQUITY TRANSACTIONS (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
EQUITY TRANSACTIONS [Abstract] | |
Stock options exercised to purchase common stock | During the three and nine months ended March 31, 2017 and 2016, stock options to purchase shares of the Company’s common stock were exercised as follows: Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Options Exercised 19,300 - 95,050 112,425 Proceeds (in thousands) $ 84 $ - $ 342 $ 313 Average exercise price per share $ 4.34 $ - $ 3.60 $ 2.77 |
Schedule of share repurchases | During the three and nine months ended March 31, 2017 and 2016, shares were repurchased as follows: Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Shares repurchased - 36,343 - 104,365 Cash paid for shares repurchased (in thousands) $ - $ 205 $ - $ 745 Average price paid per share $ - $ 5.64 $ - $ 7.14 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
GOODWILL AND INTANGIBLE ASSETS [Abstract] | |
Schedule of intangible assets | At March 31, 2017 and June 30, 2016, intangible assets consisted of the following (in thousands): March 31, 2017 June 30, 2016 Estimated Useful Lives Original Amount Accumulated Amortization Net Amount Original Amount Accumulated Amortization Net Amount Customer relationships 7 years $ 3,007 $ (382 ) $ 2,625 $ 580 $ (60 ) $ 520 Permits 6 - 15 years 1,339 (264 ) 1,075 668 (191 ) 477 Patents 5 - 17 years 383 (261 ) 122 383 (251 ) 132 Tradename 7 years 270 (29 ) 241 - - - Non-compete 5 years 117 (18 ) 99 - - - Total intangible assets, net $ 5,116 $ (954 ) $ 4,162 $ 1,631 $ (502 ) $ 1,129 |
Schedule of goodwill | The changes in the carrying amount of goodwill since June 30, 2016 was as follows (in thousands): Balance at June 30, 2016 $ 1,039 Goodwill acquired during the nine months ended March 31, 2017 5,685 Balance at March 31, 2017 $ 6,724 |
Schedule of future amortization of intangible assets | As of March 31, 2017, future amortization of intangible assets is as follows (in thousands): Twelve Months Ending March 31, 2018 611 2019 611 2020 611 2021 611 2022 593 Thereafter 1,125 $ 4,162 |
INVENTORY (Tables)
INVENTORY (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
INVENTORY [Abstract] | |
Components of inventory | The components of inventory are as follows (in thousands): March 31, 2017 June 30, 2016 Raw materials $ 1,458 1,388 Finished goods 3,068 2,531 Total $ 4,526 3,919 |
REVENUES BY SOLUTION (Tables)
REVENUES BY SOLUTION (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
REVENUES BY SOLUTION [Abstract] | |
Schedule of billings by solution | The components of revenues by solution are as follows (in thousands): Three-Months Ended March 31, 2017 % Total 2016 % Total REVENUES BY SOLUTION: Mailbacks $ 4,997 58.2 % $ 4,308 64.8 % Route-based pickup services 1,641 19.1 % 628 9.4 % Unused medications 867 10.1 % 707 10.6 % Third party treatment services 149 1.7 % 70 1.1 % Other (1) 934 10.9 % 939 14.1 % Total revenues $ 8,588 100.0 % $ 6,652 100.0 % Nine-Months Ended March 31, 2017 % Total 2016 % Total REVENUES BY SOLUTION: Mailbacks $ 17,661 63.5 % $ 17,246 70.4 % Route-based pickup services 4,686 16.8 % 1,469 6.0 % Unused medications 2,400 8.6 % 2,743 11.2 % Third party treatment services 291 1.0 % 224 0.9 % Other (1) 2,788 10.1 % 2,831 11.5 % Total revenues $ 27,826 100.0 % $ 24,513 100.0 % (1) The Company’s other products include non-mailback products such as IV poles, accessories, containers, asset return boxes and other miscellaneous items. |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 9 Months Ended |
Mar. 31, 2017 | |
Business Acquisition [Line Items] | |
Summary of acquisition related costs | During the three and nine months ended March 31, 2017 and 2016, the Company incurred acquisition related expenses for investment banking, legal and accounting fees which are included within selling, general and administrative expenses in the condensed consolidated statements of operations as follows (in thousands): Three-Months Ended March 31, Nine-Months Ended March 31, 2017 2016 2017 2016 Acquisition-related expenses $ - $ - $ 702 $ 151 |
Summary of unaudited pro forma financial information | The following table presents summarized unaudited pro forma financial information as if the Citiwaste acquisition occurred on July 1, 2015 (in thousands, except per-share data): Three-Months Ended March 31, Nine-Months Ended March 31, 2016 2016 Revenues $ 7,383 $ 26,705 Net loss $ (1,085 ) $ (336 ) Weighted average common shares outstanding 15,875 15,862 Net loss per common share basic and diluted $ (0.07 ) $ (0.02 ) |
Alpha Bio Med Services LLC [Member] | |
Business Acquisition [Line Items] | |
Preliminary purchase price allocation | The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Accounts receivable $ 51 Fixed assets 70 Intangibles 267 Goodwill 413 Accounts payable and accrued liabilities (101 ) Total purchase price $ 700 |
Bio-Team Mobile LLC [Member] | |
Business Acquisition [Line Items] | |
Preliminary purchase price allocation | The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Accounts receivable $ 42 Fixed assets 68 Intangibles 313 Goodwill 626 Accounts payable and accrued liabilities (16 ) Total purchase price $ 1,033 |
Citiwaste LLC [Member] | |
Business Acquisition [Line Items] | |
Preliminary purchase price allocation | The following amounts represent the fair value of the assets acquired and liabilities assumed (in thousands): Cash $ 5 Accounts receivable 495 Fixed assets 30 Intangibles 3,357 Goodwill 5,685 Accounts payable and accrued liabilities (356 ) Debt assumed (187 ) Total purchase price $ 9,029 |
ORGANIZATION AND BACKGROUND (De
ORGANIZATION AND BACKGROUND (Details) | 9 Months Ended |
Mar. 31, 2017StateRegion | |
ORGANIZATION AND BACKGROUND [Abstract] | |
Number of route-based pick-up service in state region | 12 |
SIGNIFICANT ACCOUNTING POLICI31
SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Revenue Recognition [Abstract] | |||||
Revenue recorded from bill and hold inventory | $ 0.7 | $ 0.4 | $ 2.5 | $ 2.7 | |
Bill and hold inventory | $ 2.6 | $ 2.6 | $ 2.1 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
INCOME TAXES [Abstract] | ||||
Income tax expense | $ 0 | $ (54) | $ 0 | $ 24 |
Effective income tax rate reconciliation [Abstract] | ||||
Effective income tax rate | 13.10% |
NOTES PAYABLE AND LONG-TERM D33
NOTES PAYABLE AND LONG-TERM DEBT (Details) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jun. 30, 2016USD ($) |
Long-term debt [Abstract] | |||||
Total long-term debt | $ 2,725 | ||||
Less: current portion | 604 | $ 0 | |||
Long-term debt, net of current portion | 2,121 | $ 0 | |||
Unsecured Note Payable [Member] | |||||
Long-term debt [Abstract] | |||||
Monthly payments | $ 7 | ||||
Maturity date | Sep. 30, 2018 | ||||
Total long-term debt | $ 125 | ||||
Term Loan [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maturity period | 5 years | ||||
Interest rate | 3.48% | ||||
Long-term debt [Abstract] | |||||
Monthly payments | $ 43 | ||||
Maturity date | Mar. 31, 2022 | ||||
Total long-term debt | $ 2,600 | ||||
Credit Agreement [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity | $ 14,000 | $ 9,000 | |||
Percentage of eligible accounts receivable considered for borrowing base | 80.00% | ||||
Percentage of eligible inventory considered for borrowing base | 50.00% | ||||
Maturity period | 2 years | ||||
Unused capacity, commitment fee percentage | 0.25% | ||||
Remaining borrowing capacity | $ 11,400 | ||||
Basis spread of variable rate | 0.00% | ||||
Debt cash flow of leverage ratio as on December 31, 2017 | 3 | 3.25 | |||
Long-term debt [Abstract] | |||||
Maturity date | Mar. 29, 2019 | ||||
Credit Agreement [Member] | Minimum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt service coverage ratio | 1.15 | ||||
Credit Agreement [Member] | Maximum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt cash flow leverage ratio | 3.50 | ||||
Debt cash flow of leverage ratio as on December 31, 2017 | 3.25 | ||||
Decrease in cash flow of leverage ratio as on March 31, 2018 | 3 | ||||
Credit Agreement [Member] | Working Capital [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity | $ 6,000 | ||||
Remaining borrowing capacity | 6,000 | ||||
Credit Agreement [Member] | Letters of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity | 2,000 | ||||
Credit Agreement [Member] | Acquisitions [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Maximum borrowing capacity | $ 8,000 | ||||
Percentage of portion allocated to acquisition purchase price | 75.00% | ||||
Remaining borrowing capacity | $ 5,400 | ||||
Credit Agreement [Member] | LIBOR [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument, term of variable rate | 1 month | ||||
Basis spread of variable rate | 2.50% | ||||
Credit Agreement [Member] | LIBOR [Member] | Maximum [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread of variable rate | 3.00% | ||||
Prior Credit Agreement [Member] | |||||
Long-term debt [Abstract] | |||||
Maturity date | Apr. 9, 2018 | ||||
Prior Credit Agreement [Member] | Letters of Credit [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Amount outstanding | $ 300 |
NOTES PAYABLE AND LONG-TERM D34
NOTES PAYABLE AND LONG-TERM DEBT, Payments Due on Long-term Debt (Details) $ in Thousands | Mar. 31, 2017USD ($) |
Payments due on long-term debt [Abstract] | |
2,018 | $ 604 |
2,019 | 561 |
2,020 | 520 |
2,021 | 520 |
2,022 | 520 |
Total long-term debt | 2,725 |
Unsecured Note Payable [Member] | |
Payments due on long-term debt [Abstract] | |
Total long-term debt | 125 |
Term Loan [Member] | |
Payments due on long-term debt [Abstract] | |
Total long-term debt | $ 2,600 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 116 | $ 152 | $ 389 | $ 510 |
Cost of Revenues [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | 8 | 7 | 33 | 25 |
Selling, General and Administrative [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Stock-based compensation expense | $ 108 | $ 145 | $ 356 | $ 485 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
EARNINGS PER SHARE [Abstract] | |||||
Net loss, as reported | $ (668) | $ (1,042) | $ (1,862) | $ (207) | $ 13 |
Weighted average common shares outstanding (in shares) | 15,994 | 15,462 | 15,930 | 15,449 | |
Net loss per common share | |||||
Basic and diluted (in dollars per share) | $ (0.04) | $ (0.07) | $ (0.12) | $ (0.01) | |
Employee stock options excluded from computation of dilutive income per share amounts because their effect would be anti-dilutive (in shares) | 269 | 137 | 304 | 96 |
EQUITY TRANSACTIONS (Details)
EQUITY TRANSACTIONS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | Jun. 30, 2016 | Jan. 07, 2013 | |
Stock options exercised [Abstract] | |||||||
Options exercised (in shares) | 19,300 | 0 | 95,050 | 112,425 | |||
Proceeds | $ 84 | $ 0 | $ 342 | $ 313 | |||
Average exercise price per share (in dollars per share) | $ 4.34 | $ 0 | $ 3.60 | $ 2.77 | |||
Compensation expense related to non-vested awards | $ 400 | $ 400 | |||||
Weighted average period | 1 year 9 months 7 days | ||||||
Stock repurchase program, authorized amount | $ 3,000 | ||||||
Stock repurchase program, period | 2 years | ||||||
Stock repurchase program term extension | 2 years | ||||||
Shares repurchased [Abstract] | |||||||
Shares repurchased (in shares) | 0 | 36,343 | 0 | 104,365 | |||
Cash paid for shares repurchased | $ 0 | $ 205 | $ 0 | $ 745 | |||
Average price paid per share (in dollars per share) | $ 0 | $ 5.64 | $ 0 | $ 7.14 | |||
Total shares repurchased under the program (in shares) | 295,615 | 295,615 | 295,615 | ||||
Total shares repurchased under the program, at cost | $ 1,554 | $ 1,554 | $ 1,554 | ||||
Amount remaining under repurchase program | $ 1,400 |
GOODWILL AND INTANGIBLE ASSET38
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, original amount | $ 5,116 | $ 1,631 | |
Intangible assets, accumulated amortization | (954) | (502) | |
Total | 4,162 | 1,129 | |
Intangible assets, amortization expense | 500 | $ 100 | |
Goodwill [Roll Forward] | |||
Balance at beginning of period | 1,039 | ||
Goodwill acquired during the nine months ended March 31, 2017 | 5,685 | ||
Balance at end of period | 6,724 | ||
Future amortization of intangible assets [Abstract] | |||
2,018 | 611 | ||
2,019 | 611 | ||
2,020 | 611 | ||
2,021 | 611 | ||
2,022 | 593 | ||
Thereafter | 1,125 | ||
Total | $ 4,162 | 1,129 | |
Customer Relationships [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 7 years | ||
Intangible assets, original amount | $ 3,007 | 580 | |
Intangible assets, accumulated amortization | (382) | (60) | |
Total | 2,625 | 520 | |
Future amortization of intangible assets [Abstract] | |||
Total | 2,625 | 520 | |
Permits [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, original amount | 1,339 | 668 | |
Intangible assets, accumulated amortization | (264) | (191) | |
Total | 1,075 | 477 | |
Future amortization of intangible assets [Abstract] | |||
Total | $ 1,075 | 477 | |
Permits [Member] | Minimum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 6 years | ||
Permits [Member] | Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 15 years | ||
Patents [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets, original amount | $ 383 | 383 | |
Intangible assets, accumulated amortization | (261) | (251) | |
Total | 122 | 132 | |
Future amortization of intangible assets [Abstract] | |||
Total | $ 122 | 132 | |
Patents [Member] | Minimum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 5 years | ||
Patents [Member] | Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 17 years | ||
Trade Name [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 7 years | ||
Intangible assets, original amount | $ 270 | 0 | |
Intangible assets, accumulated amortization | (29) | 0 | |
Total | 241 | 0 | |
Future amortization of intangible assets [Abstract] | |||
Total | $ 241 | 0 | |
Non-compete [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful lives | 5 years | ||
Intangible assets, original amount | $ 117 | 0 | |
Intangible assets, accumulated amortization | (18) | 0 | |
Total | 99 | 0 | |
Future amortization of intangible assets [Abstract] | |||
Total | $ 99 | $ 0 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Jun. 30, 2016 |
Components of inventory [Abstract] | ||
Raw materials | $ 1,458 | $ 1,388 |
Finished goods | 3,068 | 2,531 |
Total | $ 4,526 | $ 3,919 |
REVENUES BY SOLUTION (Details)
REVENUES BY SOLUTION (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
Segment Reporting Information [Line Items] | |||||
Revenue reported | $ 8,588 | $ 6,652 | $ 27,826 | $ 24,513 | |
Revenue percentage | 100.00% | 100.00% | 100.00% | 100.00% | |
Mailbacks [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue reported | $ 4,997 | $ 4,308 | $ 17,661 | $ 17,246 | |
Revenue percentage | 58.20% | 64.80% | 63.50% | 70.40% | |
Route-based Pickup Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue reported | $ 1,641 | $ 628 | $ 4,686 | $ 1,469 | |
Revenue percentage | 19.10% | 9.40% | 16.80% | 6.00% | |
Unused Medications [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue reported | $ 867 | $ 707 | $ 2,400 | $ 2,743 | |
Revenue percentage | 10.10% | 10.60% | 8.60% | 11.20% | |
Third Party Treatment Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue reported | $ 149 | $ 70 | $ 291 | $ 224 | |
Revenue percentage | 1.70% | 1.10% | 1.00% | 0.90% | |
Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Revenue reported | [1] | $ 934 | $ 939 | $ 2,788 | $ 2,831 |
Revenue percentage | [1] | 10.90% | 14.10% | 10.10% | 11.50% |
[1] | The Company's other products include non-mailback products such as IV poles, accessories, containers, asset return boxes and other miscellaneous items. |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 02, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Jun. 30, 2016 | Dec. 14, 2015 | Jul. 17, 2015 |
Preliminary purchase price allocation [Abstract] | ||||||||
Goodwill | $ 6,724 | $ 6,724 | $ 1,039 | |||||
Business acquisition related expenses [Abstract] | ||||||||
Acquisition related expenses | 0 | $ 0 | $ 702 | $ 151 | ||||
Alpha Bio/Med Services LLC [Member] | ||||||||
Preliminary purchase price allocation [Abstract] | ||||||||
Accounts receivable | $ 51 | |||||||
Fixed assets | 70 | |||||||
Intangibles | 267 | |||||||
Goodwill | 413 | |||||||
Accounts payable and accrued liabilities | (101) | |||||||
Total purchase price | 700 | |||||||
Cash consideration payment of adjusted escrow and withheld for possible settlement amounts | $ 100 | |||||||
Bio-Team Mobile LLC [Member] | ||||||||
Preliminary purchase price allocation [Abstract] | ||||||||
Accounts receivable | $ 42 | |||||||
Fixed assets | 68 | |||||||
Intangibles | 313 | |||||||
Goodwill | 626 | |||||||
Accounts payable and accrued liabilities | (16) | |||||||
Total purchase price | 1,033 | |||||||
Cash consideration payment of adjusted escrow and withheld for possible settlement amounts | $ 100 | |||||||
Citiwaste LLC [Member] | ||||||||
Preliminary purchase price allocation [Abstract] | ||||||||
Cash | $ 5 | |||||||
Accounts receivable | 495 | |||||||
Fixed assets | 30 | |||||||
Intangibles | 3,357 | |||||||
Goodwill | 5,685 | |||||||
Accounts payable and accrued liabilities | (356) | |||||||
Debt assumed | (187) | |||||||
Total purchase price | 9,029 | |||||||
Purchase price of acquisition | $ 7,000 | |||||||
Number of shares for purchase price of acquisition (in shares) | 413,272 | |||||||
Purchase price of acquisition value | $ 1,900 | |||||||
Percentage of total outstanding shares of common stock acquired | 3.00% | |||||||
Lease obligation amount | $ 100 | |||||||
Total consideration amount | $ 9,000 | |||||||
Number of shares held for common stock consideration (in shares) | 139,216 | |||||||
Escrow period for common stock consideration | 1 year | |||||||
Revenues | $ 900 | $ 2,600 | ||||||
Supplemental pro forma data [Abstract] | ||||||||
Revenues | 7,383 | 26,705 | ||||||
Net loss | $ (1,085) | $ (336) | ||||||
Weighted average common shares outstanding (in shares) | 15,875,000 | 15,862,000 | ||||||
Net loss per common share basic and diluted (in dollars per share) | $ (0.07) | $ (0.02) | ||||||
Citiwaste LLC [Member] | Credit Agreement [Member] | ||||||||
Preliminary purchase price allocation [Abstract] | ||||||||
Amount outstanding | $ 3,000 |