Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 13, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-31573 | ||
Entity Registrant Name | Medifast, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 13-3714405 | ||
Entity Address, Address Line One | 100 International Drive | ||
Entity Address, City or Town | Baltimore | ||
Entity Address, State or Province | MD | ||
Entity Address, Postal Zip Code | 21202 | ||
City Area Code | 410 | ||
Local Phone Number | 581-8042 | ||
Title of 12(b) Security | Common Stock, $0.001 par value per share | ||
Trading Symbol | MED | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2 | ||
Entity Common Stock, Shares Outstanding | 10,844,844 | ||
Documents Incorporated by Reference | Portions of the Registrant’s definitive proxy statement to be filed with the Securities and Exchange Commission for its 2023 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K. | ||
Entity Central Index Key | 0000910329 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Firm ID | 49 |
Auditor Name | RSM US LLP |
Auditor Location | Baltimore, Maryland |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 1,598,577 | $ 1,526,087 | $ 934,842 |
Cost of sales | 458,163 | 398,490 | 237,027 |
Gross profit | 1,140,414 | 1,127,597 | 697,815 |
Selling, general, and administrative | 955,608 | 911,356 | 563,656 |
Income from operations | 184,806 | 216,241 | 134,159 |
Other (expense) income | |||
Interest (expense) income | (701) | (231) | 246 |
Other (expense) income | (46) | 119 | (140) |
Total other (expense) income | (747) | (112) | 106 |
Income before provision for income taxes | 184,059 | 216,129 | 134,265 |
Provision for income taxes | 40,491 | 52,098 | 31,406 |
Net income | $ 143,568 | $ 164,031 | $ 102,859 |
Basic earnings per share | |||
Earnings per share - basic (in usd per share) | $ 12.82 | $ 14.01 | $ 8.74 |
Diluted earnings per share | |||
Earnings per share - diluted (in usd per share) | $ 12.73 | $ 13.89 | $ 8.68 |
Weighted average shares outstanding | |||
Basic (in shares) | 11,195 | 11,705 | 11,771 |
Diluted (in shares) | 11,276 | 11,813 | 11,850 |
Cash dividends declared per share (in usd per share) | $ 6.56 | $ 5.68 | $ 4.52 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 143,568 | $ 164,031 | $ 102,859 |
Other comprehensive (loss) income, net of tax: | |||
Foreign currency translation | (67) | 112 | (21) |
Unrealized (losses) gains on investment securities | (20) | (42) | 37 |
Other comprehensive (loss) income | (87) | 70 | 16 |
Comprehensive income | $ 143,481 | $ 164,101 | $ 102,875 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 87,691 | $ 104,183 |
Inventories | 118,856 | 180,043 |
Investment securities | 0 | 5,361 |
Income taxes, prepaid | 0 | 945 |
Prepaid expenses and other current assets | 16,237 | 16,334 |
Total current assets | 222,784 | 306,866 |
Property, plant and equipment - net of accumulated depreciation | 57,185 | 56,131 |
Right-of-use assets | 18,460 | 24,457 |
Other assets | 12,456 | 6,468 |
Deferred tax assets | 5,328 | 4,404 |
TOTAL ASSETS | 316,213 | 398,326 |
Current Liabilities | ||
Accounts payable and accrued expenses | 134,690 | 163,309 |
Income taxes payable | 428 | 0 |
Current lease obligations | 5,776 | 6,523 |
Total current liabilities | 140,894 | 169,832 |
Lease obligations, net of current lease obligations | 20,275 | 26,020 |
Total liabilities | 161,169 | 195,852 |
Commitments (Note 12) | ||
Stockholders' Equity | ||
Common stock, par value $.001 per share: 20,000 shares authorized; 10,928 and 11,594 issued and 10,873 and 11,593 outstanding at December 31, 2022 and December 31, 2021, respectively | 11 | 12 |
Additional paid-in capital | 21,555 | 12,018 |
Accumulated other comprehensive income | 24 | 111 |
Retained earnings | 139,852 | 190,333 |
Less: treasury stock at cost, 54 and 0 shares at December 31, 2022 and December 31, 2021, respectively | (6,398) | 0 |
Total stockholders' equity | 155,044 | 202,474 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 316,213 | $ 398,326 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, issued (in shares) | 10,928,000 | 11,594,000 |
Common stock, outstanding (in shares) | 10,873,000 | 11,593,000 |
Treasury stock at cost (in shares) | 54,000 | 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Activities | |||
Net income | $ 143,568 | $ 164,031 | $ 102,859 |
Adjustments to reconcile net income to cash provided by operating activities | |||
Depreciation and amortization | 10,980 | 6,812 | 4,316 |
Non-cash lease expense | 6,098 | 5,069 | 3,189 |
Share-based compensation | 11,053 | 9,903 | 6,796 |
Loss on sale or disposal of property, plant and equipment | 2,130 | 2 | 212 |
Amortization of premium on investment securities | 14 | 89 | 320 |
Deferred income taxes | (924) | (3,715) | 601 |
Change in operating assets and liabilities: | |||
Inventories | 61,187 | (126,651) | (4,621) |
Income taxes | 1,373 | (945) | 5,169 |
Prepaid expenses and other current assets | 97 | (9,887) | 1,086 |
Other assets | (3,412) | (4,543) | (2,741) |
Accounts payable and accrued expenses | (37,594) | 54,380 | 28,010 |
Net cash flow provided by operating activities | 194,570 | 94,545 | 145,196 |
Investing Activities | |||
Sale and maturities of investment securities | 5,267 | 5,145 | 4,605 |
Purchase of property and equipment | (16,681) | (34,209) | (5,887) |
Net cash flow used in investing activities | (11,414) | (29,064) | (1,282) |
Financing Activities | |||
Options exercised by executives and directors | 0 | 811 | 1,597 |
Net shares repurchased for taxes | (1,516) | (6,089) | (551) |
Cash dividends paid to stockholders | (71,620) | (63,856) | (53,190) |
Stock repurchases | (126,445) | (55,999) | (5,000) |
Net cash flow used in financing activities | (199,581) | (125,133) | (57,144) |
Foreign currency impact | (67) | 112 | (21) |
(Decrease) Increase in cash and cash equivalents | (16,492) | (59,540) | 86,749 |
Cash and cash equivalents - beginning of the period | 104,183 | 163,723 | 76,974 |
Cash and cash equivalents - end of period | 87,691 | 104,183 | 163,723 |
Supplemental disclosure of cash flow information | |||
Income taxes paid | 37,212 | 56,758 | 24,636 |
Dividends declared included in accounts payable | $ 19,641 | $ 17,186 | $ 13,831 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Treasury Stock |
Balance (in shares) at Dec. 31, 2019 | 12,272 | |||||
Balance at Dec. 31, 2019 | $ 104,832 | $ 12 | $ 0 | $ 25 | $ 168,788 | $ (63,993) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 102,859 | 102,859 | ||||
Share-based compensation (in shares) | 17 | |||||
Share-based compensation | 6,796 | 6,796 | ||||
Options exercised by executives and directors (in shares) | 28 | |||||
Options exercised by executives and directors | $ 1,597 | 1,597 | ||||
Net shares repurchased for taxes (in shares) | (6) | (6) | ||||
Net shares repurchased for taxes | $ (551) | (551) | ||||
Treasury stock from stock repurchases | (5,000) | (5,000) | ||||
Treasury stock retired from stock repurchases (in shares) | (489) | |||||
Treasury stock retired from stock repurchases | 0 | (63,993) | 63,993 | |||
Other comprehensive income | 16 | 16 | ||||
Cash dividends declared to stockholders | (53,303) | (53,303) | ||||
Balance (in shares) at Dec. 31, 2020 | 11,822 | |||||
Balance at Dec. 31, 2020 | 157,246 | $ 12 | 7,842 | 41 | 154,351 | (5,000) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 164,031 | 164,031 | ||||
Share-based compensation (in shares) | 55 | |||||
Share-based compensation | $ 9,596 | 9,454 | 142 | |||
Options exercised by executives and directors (in shares) | 29 | 29 | ||||
Options exercised by executives and directors | $ 811 | 811 | ||||
Net shares repurchased for taxes (in shares) | (22) | (28) | ||||
Net shares repurchased for taxes | $ (6,089) | (6,089) | ||||
Treasury stock from stock repurchases | (55,999) | (55,999) | ||||
Treasury stock retired from stock repurchases (in shares) | (284) | |||||
Treasury stock retired from stock repurchases | 0 | (60,999) | 60,999 | |||
Other comprehensive income | 70 | 70 | ||||
Cash dividends declared to stockholders | $ (67,192) | (67,192) | ||||
Balance (in shares) at Dec. 31, 2021 | 11,594 | 11,594 | ||||
Balance at Dec. 31, 2021 | $ 202,474 | $ 12 | 12,018 | 111 | 190,333 | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 143,568 | 143,568 | ||||
Share-based compensation (in shares) | 20 | |||||
Share-based compensation | $ 11,053 | 11,053 | ||||
Options exercised by executives and directors (in shares) | 0 | |||||
Net shares repurchased for taxes (in shares) | (9) | (9) | ||||
Net shares repurchased for taxes | $ (1,516) | (1,516) | ||||
Treasury stock from stock repurchases | (126,445) | (126,445) | ||||
Treasury stock retired from stock repurchases (in shares) | (677) | |||||
Treasury stock retired from stock repurchases | (1) | $ (1) | (120,047) | 120,047 | ||
Other comprehensive income | (87) | (87) | ||||
Cash dividends declared to stockholders | $ (74,002) | (74,002) | ||||
Balance (in shares) at Dec. 31, 2022 | 10,928 | 10,928 | ||||
Balance at Dec. 31, 2022 | $ 155,044 | $ 11 | $ 21,555 | $ 24 | $ 139,852 | $ (6,398) |
NATURE OF THE BUSINESS
NATURE OF THE BUSINESS | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF THE BUSINESS | NATURE OF THE BUSINESS Medifast, Inc. (the “Company” or “Medifast”) is a Delaware corporation, incorporated in 1989. The Company’s operations are primarily conducted through its wholly owned subsidiaries, Jason Pharmaceuticals, Inc., OPTA VIA, LLC, Jason Enterprises, Inc., Jason Properties, LLC, Seven Crondall Associates, LLC, Corporate Events, Inc., OPTA VIA (Hong Kong) Limited, OPTA VIA (Singapore) PTE. LTD and OPTA VIA Health Consultation (Shanghai) Co., Ltd. Medifast is the company behind one of the fastest-growing health and wellness communities called OPTA VIA. OPTA VIA is a highly effective lifestyle solution for people for whom diets alone have failed. The Company has one modern, United States Food and Drug Administration (the “FDA”) approved manufacturing facility located in Owings Mills, Maryland. Medifast sells a variety of weight loss, weight management and healthy living products all based on our proprietary formulas under the OPTA VIA, Optimal Health by Take Shape for Life, and Flavors of Home ® brands. The Company’s product line includes more than 65 consumable options, including, but not limited to, bars, bites, pretzels, puffs, cereal crunch, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups. Medifast’s nutritional products are formulated with high-quality ingredients. The processing, formulation, packaging, labeling and advertising of the Company’s products are subject to regulation by one or more federal agencies, including the FDA, the Federal Trade Commission (the “FTC”), the Consumer Product Safety Commission, the United States Department of Agriculture, and the United States Environmental Protection Agency. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The Company’s fiscal year ends on December 31. Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from those estimates. Cash and Cash Equivalents - Cash and cash equivalents consist of cash on deposit in financial institutions, institutional money funds and other short-term investments with a maturity of 90 days or less at the time of purchase. All credit card and debit card transactions that process in less than seven days are classified as cash and cash equivalents. The amounts due from banks for these transactions classified as cash and cash equivalents totaled $7.4 million as of December 31, 2022, and $12.2 million as of December 31, 2021. Concentration of Credit Risk - Our cash and cash equivalents and available-for-sale securities are maintained at several financial institutions and the balances with these financial institutions often exceed the amount of insurance provided on such accounts by the Federal Deposit Insurance Corporation. The cash and cash equivalents generally are maintained with financial institutions with reputable credit, and therefore bear minimal credit risk. Historically, we have not experienced any losses due to such concentration of credit risk. Fair Value of Financial Instruments - Our financial instruments include cash and cash equivalents, and investment in available-for-sale securities. The carrying amounts of cash and cash equivalents approximate fair value due to their short maturities. The fair value of investments in available-for-sale securities are based on third-party pricing services provided by the Company’s investment advisory firm. Inventories - Inventories consist principally of raw materials and packaged meal replacements held in the Company’s warehouses and outsourced distribution centers. Inventories are stated at the lower of cost or net realizable value, utilizing the first-in, first-out method. The cost of finished goods includes the cost of raw materials, packaging supplies, direct and indirect labor, and other indirect manufacturing costs. On a quarterly basis, management reviews inventories for unsalable or obsolete inventories. The Company donated inventory with an aggregate cost of $19.0 million to Ukrainian refugees and those in need in Ukraine, which is included in selling, general and administrative expenses during the year ended December 31, 2022. The donations were made to two 501(c)(3) organizations that are coordinating the distribution throughout refugee camps in Europe and in Ukraine. The Company incurred approximately $12.2 million of costs in connection with the restructuring of certain external manufacturing agreements to optimize its supply chain, which is included in cost of sales during the year ended December 31, 2022. Investment Securities - The Company’s investments consist of debt securities classified as available-for-sale securities. Available-for-sale debt securities are stated at fair value and unrealized holding gains and losses, net of the related deferred tax effect, are reported as a separate component of accumulated other comprehensive income (loss) in stockholders’ equity. Interest and dividends on marketable debt securities are recognized in income when declared. Realized gains and losses, if any, are included in income. Property, Plant, and Equipment - Property, plant and equipment are stated at cost less accumulated depreciation and amortization. The Company computes depreciation and amortization using the straight-line method over the estimated useful lives of the assets acquired as follows: Building and building improvements 10 - 35 years Leasehold Improvements (1) Lease term Equipment and fixtures 3 - 15 years Software (2) 3 - 5 years Vehicles 5 years (1) The depreciation life for leasehold improvements is the lesser of the estimated useful life of the addition or the term of the related lease. (2) Capitalized costs of cloud software are reported in Other assets on the balance sheet and are amortized over an estimated useful life of 3 to 5 years. Long-lived Asset Impairment - Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Revenue Recognition - Our revenue is derived primarily from point of sale transactions executed over an e-commerce platform for weight loss, weight management, and other consumable health and nutritional products. Revenue is recognized upon receipt by customer and net of discounts, rebates, promotional adjustments, price adjustments, allocated consideration to loyalty programs, and estimated returns. Revenue is recognized when control of the promised products is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for transferring those products. When determining whether the customer has obtained control of the products, we consider any future performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC 606, Revenue from Contracts with Customers . A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, each performance obligation is satisfied. Our contracts have performance obligations to fulfill and deliver products from the point of sale transaction along with the related customer reward programs. Our performance obligations are satisfied at a point in time. Revenue from products transferred to customers at a point in time accounted for substantially all of our revenue for the years ended December 31, 2022, 2021 and 2020. Revenue on these contracts is recognized when obligations under the terms of the contract with our customer are satisfied. Generally, this occurs with the transfer of control upon receipt of products by our customers. Any consideration received prior to the fulfillment of the Company’s performance obligation is deferred and recognized as a liability. Sales returns Our return policy allows for customer returns of consumable products within 30 days of purchase and upon our authorization. We adjust revenues for the products expected to be returned and a liability is recognized for expected refunds to customers. We estimate expected returns based on historical levels and project this experience into the future. Customer reward programs and sales incentives Our sales contracts may give customers the option to purchase additional products priced at a discount. Options to acquire additional products at a discount can come in many forms, such as customer reward programs and incentive offerings including pricing arrangements and promotions. We reduce the transaction price for certain customer reward programs and incentive offerings including pricing arrangements, promotions, and incentives that represent variable consideration and separate performance obligations. The Company accounts for sales rewards that provide the customer with a material right as a separate performance obligation of the transactions, and therefore allocates consideration between the initial sale of products and the customer reward program and incentive offering. Shipping and handling costs Amounts billed to customers for shipping and handling activities are treated as a promised service performance obligation and are recorded in revenue in the accompanying Consolidated Statements of Income upon fulfillment of the performance obligation. Shipping and handling costs incurred by the Company for the delivery of products to customers are considered a cost to fulfill the contract and are included in cost of sales in the accompanying Consolidated Statements of Income. Contract costs We expense OPTA VIA Coach compensation and credit card fees during the period in which the corresponding revenue is earned. These costs are deferred along with the revenues for goods that are in transit and not received by customers by period end. These costs are recorded in selling, general and administrative expense in the accompanying Consolidated Statements of Income. Leases - The Company determines if an arrangement is a lease at inception and categorizes leases with contractual terms longer than twelve months as either operating or finance. All the Company’s leases are operating leases. The right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent an obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The ROU asset also consists of any prepaid lease payments and lease incentives received. The lease terms used to calculate the ROU asset and related lease liability include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense. Advertising Costs - Advertising costs are expensed as incurred, except for the preparation, layout, design and production of advertising costs which are expensed when the advertisement is first used. They are recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. Advertising expense, excluding broker fees, for the years ended December 31, 2022, 2021 and 2020, amounted to $1.7 million, $1.6 million and $4.4 million, respectively. Research and Development - The Company incurs research and development costs in connection with the development of new products and programs and clinical research activities, which are expensed as incurred. They are recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. The Company incurred $4.5 million, $4.4 million, $2.8 million in research and development expense for the years ended December 31, 2022, 2021 and 2020, respectively. Share-Based Compensation - Share-based compensation consists primarily of restricted stock awards, performance-based share awards, and stock options granted to employees and directors. Restricted stock awards are measured at the grant date, based on the calculated fair value of the award, and are recognized as an expense over the requisite service period. Performance-based share awards are measured based on the grant-date market price of the Company's common stock adjusted by expected level of achievement over the performance period. The fair value of the incentive stock options and non-qualified stock options is calculated using the Black-Scholes option pricing model as of the grant date and recognized over the service period. The Company issues new shares upon the exercise of stock options, the granting of restricted stock awards, and the achieved performance against pre-determined performance goals over the performance period for performance-based share awards. Income Taxes - Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more-likely-than-not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying Consolidated Balance Sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. Our policy is to recognize interest and penalties accrued on uncertain tax positions as part of income tax expense. We evaluated our tax positions and determined that we did not have any material uncertain tax positions. Earnings Per Share - Basic earnings per share (“EPS”) computations are calculated utilizing the weighted average number of shares of common stock outstanding during the periods presented. Diluted EPS is calculated utilizing the weighted average number of shares of common stock outstanding adjusted for the effect of dilutive common stock equivalents. Comprehensive Income - Other comprehensive income refers to revenues, expenses, and gains and losses that are not included in net income but rather are recorded directly in stockholders’ equity. Comprehensive income consists of net income, unrealized gains and losses on available-for-sale securities, and foreign currency translation adjustments. Accounting Pronouncements - Adopted in 2022 In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying accounting principles under GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met and to other derivative instruments if there is a change to the interest rates used for discounting, margining or contract price alignment. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. We adopted Topic 848 beginning in the first quarter of fiscal 2022 without any material impact on the Company's financial position and results of operations. Recently Issued Accounting Pronouncements - Pending Adoption |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consisted of the following (in thousands): December 31, 2022 December 31, 2021 Raw materials $ 12,670 $ 15,196 Packaging 3,611 3,641 Non-food finished goods 8,738 15,991 Finished goods 97,675 152,687 Reserve for obsolete inventory (3,838) (7,472) Total $ 118,856 $ 180,043 |
PROPERTY, PLANT AND EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | PROPERTY, PLANT AND EQUIPMENT Property, plant, and equipment consisted of the following (in thousands): December 31, 2022 December 31, 2021 Land $ 565 $ 565 Building and leasehold improvements 25,905 23,518 Equipment and fixtures 49,260 42,708 Software 21,278 21,894 Vehicles 118 145 Property, plant and equipment - gross 97,126 88,830 Less: accumulated depreciation (39,941) (32,699) Property, plant and equipment - net $ 57,185 $ 56,131 Depreciation expense for the years ended December 31, 2022, 2021 and 2020 was $7.9 million, $5.7 million and $4.1 million, respectively. |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following (in thousands): December 31, 2022 December 31, 2021 Trade payables and accrued expenses $ 58,667 $ 70,894 OPTA VIA Coach compensation payable 23,633 28,733 Dividends payable 19,641 17,186 Accrued payroll and related taxes 13,581 24,940 Promotional sales incentive accruals 10,240 10,935 Deferred revenue 7,357 8,050 Sales tax payable 1,571 2,571 Total $ 134,690 $ 163,309 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table sets forth the computation of basic and diluted EPS for the years ended December 31, 2022, 2021 and 2020 (in thousands, except per share data): 2022 2021 2020 Numerator: Net income $ 143,568 $ 164,031 $ 102,859 Denominator: Weighted average shares of common stock outstanding 11,195 11,705 11,771 Effect of dilutive common stock equivalents 81 108 79 Weighted average shares of common stock outstanding 11,276 11,813 11,850 Earnings per share - basic $ 12.82 $ 14.01 $ 8.74 Earnings per share - diluted $ 12.73 $ 13.89 $ 8.68 The calculation of diluted earnings per share excluded 0, 0 and less than 1 thousand antidilutive options outstanding for the years ended December 31, 2022, 2021 and 2020, respectively. The calculation of diluted earnings per share for the years ended December 31, 2022, 2021 and 2020 also excluded 5 thousand, less than 1 thousand and 3 thousand antidilutive restricted stock awards, respectively. |
EQUITY
EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
EQUITY | EQUITY Authorized Shares Pursuant to the Company’s Restated and Amended Certificate of Incorporation, the Company has the authority to issue 21.5 million capital shares consisting of: (i) 20.0 million shares of common stock having a par value of $0.001 per share and (ii) 1.5 million shares of preferred stock having a par value $0.001 per share. As of December 31, 2022, there were approximately 10.9 million and 0 shares of common stock and preferred stock issued, respectively. Issuance of Additional Common Stock On May 18, 2017, the stockholders of the Company approved the Medifast, Inc. Amended and Restated 2012 Share Incentive Plan (the “Amended and Restated 2012 Plan”) that increased the number of shares of the Company’s common stock that may be awarded under the Amended and Restated 2012 Plan by 600 thousand, to an aggregate of 1.6 million. Stock Repurchase Plan The Company implemented a stock repurchase plan on September 16, 2014 (the “Stock Repurchase Plan”). On September 12, 2019, the Company's Board of Directors authorized an additional 2.0 million shares for repurchase under the Stock Repurchase Plan. The Company repurchased approximately 739 thousand and 238 thousand shares during the years ended December 31, 2022 and 2021, respectively. As of December 31, 2022, there were approximately 1.4 million shares of common stock remaining under the Company’s Stock Repurchase Plan. There is no guarantee as to the exact number of shares of the Company’s common stock, if any, that will be repurchased under the Stock Repurchase Plan. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Stock Options: The Company has issued non-qualified and incentive stock options to employees and non-employee directors. The fair value of these options are estimated on the date of grant using the Black-Scholes option pricing model, which requires estimates of the expected term of the option, the risk-free interest rate, the expected volatility of the price of the Company’s common stock, and dividend yield. Options outstanding as of December 31, 2022 generally vest over a period of three years and expire ten years from the date of grant. The exercise price of these options ranges from $26.52 to $66.68. Due to the Company’s lack of option exercise history on the date of grant, the expected term is calculated using the simplified method defined as the midpoint between the vesting period and the contractual term of each option. The risk free interest rate is based on the U.S. Treasury yield curve in effect on the date of grant that most closely corresponds to the expected term of the option. The expected volatility is based on the historical volatility of the Company’s common stock over the period of time equivalent to the expected term for each award. The dividend yield is computed as the annualized dividend rate at the grant date divided by the strike price of the stock option. For the years ended December 31, 2022 and 2021, the Company did not grant stock options. The number of stock options and weighted-average exercise prices as of December 31, 2022 and 2021 are as follows: 2022 2021 Awards Weighted-Average Exercise Price Awards Weighted-Average Exercise Price (awards in thousands) Outstanding at beginning of period 32 $ 54.98 61 $ 48.19 Exercised — — (29) 40.53 Forfeited — — — — Outstanding at end of the period 32 $ 54.98 32 $ 54.98 Exercisable at end of the period 28 $ 52.76 23 $ 49.50 As of December 31, 2022, the weighted-average remaining contractual life was 51 months with an aggregate intrinsic value of $2.0 million for outstanding stock options and the weighted-average remaining contractual life was 51 months with an aggregate intrinsic value of $1.7 million for exercisable options. The unrecognized compensation expense calculated under the fair value method for shares expected to vest as of December 31, 2022 was less than $0.1 million and is expected to be recognized over a weighted average period of 1 month. No stock options were exercised in 2022. The Company received $0.8 million and $1.6 million in cash proceeds from the exercise of stock options during the years ended December 31, 2021 and 2020, respectively. The total intrinsic value of options exercised during the years ended December 31, 2021 and 2020 was $5.9 million and $1.5 million, respectively. Restricted Stock: The Company has issued restricted stock to employees and non-employee directors generally with vesting terms up to five years after the date of grant. The fair value of the restricted stock is equal to the market price of the Company’s common stock on the date of grant. Expense for restricted stock is amortized ratably over the vesting period. A summary of outstanding restricted stock activity as of December 31, 2022 and 2021 are as follows: 2022 2021 Shares Weighted-Average Grant Date Fair Value Shares Weighted-Average Grant Date Fair Value (shares in thousands) Outstanding at beginning of period 43 $ 183.51 50 $ 116.06 Granted 38 176.60 22 264.58 Vested (20) 156.68 (26) 116.68 Forfeited (1) 188.60 (3) 169.47 Outstanding at end of the period 60 $ 187.94 43 $ 183.51 The Company withheld approximately 9 thousand, 22 thousand and 6 thousand shares of the Company’s common stock to cover minimum tax liability withholding obligations upon the vesting of shares of restricted stock for the years ended December 31, 2022, 2021 and 2020, respectively. The total fair value of restricted stock awards vested during the years ended December 31, 2022, 2021 and 2020 was $3.5 million, $7.0 million and $3.7 million, respectively. Market and Performance-based Share Awards: The Company has issued market and performance-based share awards to certain key executives who were granted deferred shares and may earn between 0% and 250% of the target number depending upon both the Company's total stockholder return ("TSR") and the Company's performance against predetermined performance goals over a three-year performance period after the date of grant. Market and performance-based share awards that are tied to the Company's TSR are valued using the Monte Carlo method and recognized ratably as expense over the award's performance period. The fair value of the performance-based share awards is equal to the market price of the Company’s common stock on the date of grant adjusted by expected level of achievement over the performance period. Expense for performance-based share awards is amortized ratably over the performance period. Share-based compensation expense is recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. The total expenses during the years ended December 31, 2022, 2021 and 2020 are as follows (in thousands): 2022 2021 2020 Shares Share-Based Compensation Expense Shares Share-Based Compensation Expense Shares Share-Based Compensation Expense Options and restricted stock 92 $ 5,167 75 $ 4,302 111 $ 3,493 Market and performance-based share awards granted in 2022 25 1,389 — — — — Performance-based share awards granted in 2021 15 2,595 15 1,986 — — Performance-based share awards granted in 2020 52 1,902 26 1,807 28 1,662 Performance-based share awards granted in 2019 — — — 1,808 17 1,641 Total share-based compensation 184 $ 11,053 116 $ 9,903 156 $ 6,796 The total income tax benefit recognized in the accompanying Consolidated Statements of Income for restricted stock awards was $1.2 million, $2.4 million and $1.4 million for the years ended December 31, 2022, 2021 and 2020, respectively. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | ACCUMULATED OTHER COMPREHENSIVE INCOME The following table sets forth the components of accumulated other comprehensive income, net of tax where applicable (in thousands): December 31, 2022 December 31, 2021 Foreign currency translation $ 24 $ 90 Unrealized gains on investment securities — 21 Accumulated other comprehensive income $ 24 $ 111 |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS Certain financial assets and liabilities are accounted for at fair value, which is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy prioritizes the inputs used to measure fair value: Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 – Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value from the perspective of a market participant. The following tables present the Company’s cash and financial assets that are measured at fair value on a recurring basis for each of the hierarchy levels (in thousands): December 31, 2022 Cost Unrealized Accrued Estimated Cash & Cash Investment Cash and cash equivalents $ 87,691 $ — $ — $ 87,691 $ 87,691 $ — Total $ 87,691 $ — $ — $ 87,691 $ 87,691 $ — December 31, 2021 Cost Unrealized Accrued Estimated Cash & Cash Investment Cash and cash equivalents $ 94,824 $ — $ — $ 94,824 $ 94,824 $ — Level 1: Money market accounts 9,359 — — 9,359 9,359 — Government & agency securities 1,401 12 — 1,413 — 1,413 10,760 12 — 10,772 9,359 1,413 Level 2: Municipal bonds 3,880 9 59 3,948 — 3,948 Total $ 109,464 $ 21 $ 59 $ 109,544 $ 104,183 $ 5,361 The Company had no realized losses or gains for the years ended December 31, 2022, 2021 and 2020. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Income tax expense for the years ended December 31, 2022, 2021 and 2020 consisted of the following (in thousands): 2022 2021 2020 Current Federal $ 35,857 $ 49,433 $ 28,520 State 5,558 6,380 2,285 Total current 41,415 55,813 30,805 Deferred Federal (738) (3,424) 477 State (186) (291) (77) Foreign — — 201 Total deferred (924) (3,715) 601 Provision for income taxes $ 40,491 $ 52,098 $ 31,406 The total provision for income taxes for the years ended December 31, 2022, 2021 and 2020 was $40.5 million, $52.2 million and $31.4 million, respectively. Those amounts have been allocated to the following financial statement items: 2022 2021 2020 Income before provision for income taxes $ 40,491 $ 52,098 $ 31,406 Stockholders' equity, unrealized (losses) gains on investment securities & foreign currency (27) 66 14 Total provision for income taxes $ 40,464 $ 52,164 $ 31,420 The reconciliation of the United States federal statutory tax provision to the Company’s provision for income taxes for the years ended December 31, 2022, 2021 and 2020 (in thousands, except percentages): 2022 2021 2020 Statutory federal tax $ 38,621 21.0 % $ 45,405 21.0 % $ 28,196 21.0 % State income taxes, net of federal benefit 4,635 2.5 % 4,980 2.3 % 1,470 1.1 % Foreign taxes Hong Kong 75 0.0 % 91 0.0 % 94 0.1 % Singapore 28 0.0 % 32 0.0 % 107 0.1 % Share-based compensation - windfall (26) 0.0 % (1,835) (0.8) % (415) (0.3) % Research and development and jobs credits (819) (0.4) % (503) (0.2) % (370) (0.3) % Executive compensation 1,470 0.8 % 2,652 1.2 % 966 0.7 % Charitable donations (4,316) (2.3) % — 0.0 % — 0.0 % Valuation allowance 396 0.2 % 468 0.2 % 1,342 1.0 % Other permanent differences 427 0.2 % 808 0.4 % 16 0.0 % Provision for income taxes $ 40,491 22.0 % $ 52,098 24.1 % $ 31,406 23.4 % Significant components of the Company’s deferred tax assets (liabilities) consisted of the following (in thousands): December 31, 2022 December 31, 2021 Reserves on inventory and sales $ 1,069 $ 2,022 Credit and loss carryforwards 3,713 3,052 Stock compensation 2,374 420 Accrued expenses and deferred costs 5,153 4,240 Inventory capitalization 1,781 3,514 Lease obligations 5,773 7,191 Capitalized research costs 2,502 — Charitable donations 1,862 — Other 190 — Valuation allowance (2,523) (1,904) Total deferred tax assets 21,894 18,535 Right-of-use assets (4,089) (5,375) Unrealized loss on investment securities (23) (6) Prepaid expenses (1,289) (1,175) Depreciation (11,165) (7,575) Other — — Total deferred tax liabilities (16,566) (14,131) Net deferred tax assets $ 5,328 $ 4,404 On March 27, 2020, the President of the United States signed into law the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”). It amends the Internal Revenue Code to provide relief and supportive measures for taxpayers impacted by the outbreak of COVID-19 virus. The key components of the Act are as follows: eliminating taxable income limitation for certain net operating losses (“NOL”) and permitting carry back NOLs arising in 2019 , 2020 and 2021 to five prior tax years; accelerating refunds of previously generated Alternative Minimum Tax credit; increasing business interest limitation from 30 percent to 50 percent of adjusted taxable income; amending depreciation for qualified improvement property (“QIP”) to 15- year property for QIP placed in service after December 31, 2018. The Company's income tax provision provided under the CARES Act did not have a material impact on the year ended December 31, 2022, 2021 and 2020. On August 12, 2022, the President of the United States signed into law the Inflation Reduction Act. The two primary tax implications for corporations are a 15% alternative minimum tax (“AMT”) that applies to corporations with at least one billion of pretax income and a one percent surtax on share buybacks. The AMT will not apply to the Company since the Company’s pretax income does not exceed the threshold. The one percent surtax on share repurchases will apply to the Company when it comes into force in 2023. The Company's income tax provision provided under the Inflation Reduction Act did not have a material impact on the year ended December 31, 2022. The Company has separate state and foreign net operating loss carry forwards totaling $31.6 million that start expiring in 2029. The Company has recorded a valuation allowance for the portion of the net operating loss carry forwards which is not expected to be realized. We file income tax returns in the United States and various states and foreign jurisdictions. We are generally no longer subject to United States federal, state and local income tax examinations by tax authorities for the years before 2019. |
LEASES AND COMMITMENTS
LEASES AND COMMITMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
LEASES AND COMMITMENTS | LEASES AND COMMITMENTS Operating Leases: The Company has operating leases for office and warehouse space and certain equipment. In certain of the Company’s lease agreements, the rental payments are adjusted periodically based on defined terms within the lease. The Company did not have any finance leases as of December 31, 2022 and 2021, respectively, or for the years then ended. Our leases relating to office and warehouse space have terms of 18 months to 126 months. Our leases relating to equipment have lease terms of 24 months to 203 months, with certain of them having clauses relating to automatic renewal. The Company’s warehouse agreements also contain non-lease components, in the form of payments towards variable logistics services and labor charges, which the Company is obligated to pay based on the services consumed by it. Such amounts are not included in the measurement of the lease liability but will be recognized as expense when they are incurred. The operating lease expense was $6.7 million, $5.6 million and $3.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. Supplemental cash flow information related to the Company’s operating leases were as follows (in thousands): 2022 2021 Cash paid for amounts included in the measurements of lease liabilities Operating cash flow used in operating leases $ 7,199 $ 4,504 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 101 $ 18,872 As of December 31, 2022, the weighted average remaining lease term was 58 months and the weighted average discount rate was 2.1%. The following table presents the maturity of the Company’s operating lease liabilities as of December 31, 2022 (in thousands): 2023 $ 6,243 2024 5,693 2025 5,825 2026 4,160 2027 2,553 Thereafter 2,858 Total lease payments $ 27,332 Less: imputed interest (1,281) Total $ 26,051 Unconditional purchase obligations: At December 31, 2022, the Company had $215.7 million in unconditional purchase obligations primarily for inventories, outsourced information technology and Coach events. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Credit Agreement On April 13, 2021, the Company and certain of its subsidiaries (collectively, the “Guarantors”) entered into a credit agreement (the “Credit Agreement”) among the Company, the Guarantors, the lenders party thereto and Citibank, N.A., in its capacity as administrative agent. On May 31, 2022, the Credit Agreement was amended to increase the borrowing capacity and convert the interest rate to be based on Secured Overnight Financing Rate ("SOFR"), from London Inter-Bank Offered Rate (LIBOR) ("the "Amended Credit Agreement"). The Amended Credit Agreement provides for a $225.0 million senior secured revolving credit facility with a $20.0 million letter of credit sublimit. The Amended Credit Agreement also provides for an uncommitted incremental facility that permits the Company, subject to certain conditions, to increase the senior secured revolving credit facility by up to $100.0 million. The Credit Agreement matures on April 13, 2026. The Company’s obligations under the Amended Credit Agreement are guaranteed by the Guarantors. The obligations of the Company and the Guarantors are secured by first-priority liens on substantially all of the assets of the Company and the Guarantors, subject to certain exceptions. Under the Amended Credit Agreement, the Company will pay to the administrative agent for the account of each revolving lender a commitment fee on a quarterly basis based on amounts committed but unused under the revolving facility from 0.20 to 0.40% per annum depending on the Company’s Total Net Leverage Ratio (as defined in the Amended Credit Agreement). The Company is also obligated to pay the administrative agent customary fees for credit facilities of this size and type. Revolving borrowings under the Amended Credit Agreement bear interest at a rate per annum equal to (i) the Term SOFR Rate for the interest period plus the Applicable Rate (as defined in the Amended Credit Agreement) based on the Company’s Total Net Leverage Ratio or (ii) the Alternate Base Rate (as defined in the Amended Credit Agreement) as in effect from time to time plus the Applicable Rate based on the Company’s Total Net Leverage Ratio. As of December 31, 2022, the Applicable Rate for SOFR Loans is 1.25% per annum and the Applicable Rate for ABR Loans is 0.25% per annum. SOFR based loans also include a Credit Spread Adjustment based on the duration of the borrowing. The Amended Credit Agreement contains affirmative and negative covenants customarily applicable to senior secured credit facilities, including covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries, subject to negotiated exceptions, to incur additional indebtedness and additional liens on their assets, engage in mergers or acquisitions or dispose of assets, pay dividends or make other distributions, voluntarily prepay other indebtedness, enter into transactions with affiliated persons, make investments and change the nature of their businesses. The Amended Credit Agreement also contains customary events of default, subject to thresholds and grace periods, including, among others, payment default, covenant default, cross default to other material indebtedness and judgment default. In addition, the Amended Credit Agreement requires the Company to maintain a Total Net Leverage Ratio of no more than 2.75 to 1.00 and an Interest Coverage Ratio of at least 3.50 to 1.00. The Company had no borrowings under the Amended Credit Agreement as of December 31, 2022 and December 31, 2021. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation - The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The Company’s fiscal year ends on December 31. |
Use of Estimates | Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents - Cash and cash equivalents consist of cash on deposit in financial institutions, institutional money funds and other short-term investments with a maturity of 90 days or less at the time of purchase. All credit card and debit card transactions that process in less than seven days are classified as cash and cash equivalents. The amounts due from banks for these transactions classified as cash and cash equivalents totaled $7.4 million as of December 31, 2022, and $12.2 million as of December 31, 2021. |
Concentration of Credit Risk | Concentration of Credit Risk - Our cash and cash equivalents and available-for-sale securities are maintained at several financial institutions and the balances with these financial institutions often exceed the amount of insurance provided on such accounts by the Federal Deposit Insurance Corporation. The cash and cash equivalents generally are maintained with financial institutions with reputable credit, and therefore bear minimal credit risk. Historically, we have not experienced any losses due to such concentration of credit risk. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments - Our financial instruments include cash and cash equivalents, and investment in available-for-sale securities. The carrying amounts of cash and cash equivalents approximate fair value due to their short maturities. The fair value of investments in available-for-sale securities are based on third-party pricing services provided by the Company’s investment advisory firm. |
Inventories | Inventories - Inventories consist principally of raw materials and packaged meal replacements held in the Company’s warehouses and outsourced distribution centers. Inventories are stated at the lower of cost or net realizable value, utilizing the first-in, first-out method. The cost of finished goods includes the cost of raw materials, packaging supplies, direct and indirect labor, and other indirect manufacturing costs. On a quarterly basis, management reviews inventories for unsalable or obsolete inventories. |
Investment Securities | Investment Securities - The Company’s investments consist of debt securities classified as available-for-sale securities. Available-for-sale debt securities are stated at fair value and unrealized holding gains and losses, net of the related deferred tax effect, are reported as a separate component of accumulated other comprehensive income (loss) in stockholders’ equity. Interest and dividends on marketable debt securities are recognized in income when declared. Realized gains and losses, if any, are included in income. |
Property, Plant, and Equipment | Property, Plant, and Equipment - Property, plant and equipment are stated at cost less accumulated depreciation and amortization. The Company computes depreciation and amortization using the straight-line method over the estimated useful lives of the assets acquired as follows: Building and building improvements 10 - 35 years Leasehold Improvements (1) Lease term Equipment and fixtures 3 - 15 years Software (2) 3 - 5 years Vehicles 5 years (1) The depreciation life for leasehold improvements is the lesser of the estimated useful life of the addition or the term of the related lease. (2) Capitalized costs of cloud software are reported in Other assets on the balance sheet and are amortized over an estimated useful life of 3 to 5 years. |
Long-lived Asset Impairment | Long-lived Asset Impairment - Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. |
Revenue Recognition | Revenue Recognition - Our revenue is derived primarily from point of sale transactions executed over an e-commerce platform for weight loss, weight management, and other consumable health and nutritional products. Revenue is recognized upon receipt by customer and net of discounts, rebates, promotional adjustments, price adjustments, allocated consideration to loyalty programs, and estimated returns. Revenue is recognized when control of the promised products is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for transferring those products. When determining whether the customer has obtained control of the products, we consider any future performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the unit of account in ASC 606, Revenue from Contracts with Customers . A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, each performance obligation is satisfied. Our contracts have performance obligations to fulfill and deliver products from the point of sale transaction along with the related customer reward programs. Our performance obligations are satisfied at a point in time. Revenue from products transferred to customers at a point in time accounted for substantially all of our revenue for the years ended December 31, 2022, 2021 and 2020. Revenue on these contracts is recognized when obligations under the terms of the contract with our customer are satisfied. Generally, this occurs with the transfer of control upon receipt of products by our customers. Any consideration received prior to the fulfillment of the Company’s performance obligation is deferred and recognized as a liability. Sales returns Our return policy allows for customer returns of consumable products within 30 days of purchase and upon our authorization. We adjust revenues for the products expected to be returned and a liability is recognized for expected refunds to customers. We estimate expected returns based on historical levels and project this experience into the future. Customer reward programs and sales incentives Our sales contracts may give customers the option to purchase additional products priced at a discount. Options to acquire additional products at a discount can come in many forms, such as customer reward programs and incentive offerings including pricing arrangements and promotions. We reduce the transaction price for certain customer reward programs and incentive offerings including pricing arrangements, promotions, and incentives that represent variable consideration and separate performance obligations. The Company accounts for sales rewards that provide the customer with a material right as a separate performance obligation of the transactions, and therefore allocates consideration between the initial sale of products and the customer reward program and incentive offering. Shipping and handling costs Amounts billed to customers for shipping and handling activities are treated as a promised service performance obligation and are recorded in revenue in the accompanying Consolidated Statements of Income upon fulfillment of the performance obligation. Shipping and handling costs incurred by the Company for the delivery of products to customers are considered a cost to fulfill the contract and are included in cost of sales in the accompanying Consolidated Statements of Income. Contract costs We expense OPTA VIA Coach compensation and credit card fees during the period in which the corresponding revenue is earned. These costs are deferred along with the revenues for goods that are in transit and not received by customers by period end. These costs are recorded in selling, general and administrative expense in the accompanying Consolidated Statements of Income. |
Leases | Leases - The Company determines if an arrangement is a lease at inception and categorizes leases with contractual terms longer than twelve months as either operating or finance. All the Company’s leases are operating leases. The right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent an obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As most of the Company’s leases do not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. The ROU asset also consists of any prepaid lease payments and lease incentives received. The lease terms used to calculate the ROU asset and related lease liability include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense. |
Advertising Costs | Advertising Costs - Advertising costs are expensed as incurred, except for the preparation, layout, design and production of advertising costs which are expensed when the advertisement is first used. They are recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. Advertising expense, excluding broker fees, for the years ended December 31, 2022, 2021 and 2020, amounted to $1.7 million, $1.6 million and $4.4 million, respectively. |
Research and Development | Research and Development - The Company incurs research and development costs in connection with the development of new products and programs and clinical research activities, which are expensed as incurred. They are recorded in selling, general, and administrative expense in the accompanying Consolidated Statements of Income. |
Share-Based Compensation | Share-Based Compensation - Share-based compensation consists primarily of restricted stock awards, performance-based share awards, and stock options granted to employees and directors. Restricted stock awards are measured at the grant date, based on the calculated fair value of the award, and are recognized as an expense over the requisite service period. Performance-based share awards are measured based on the grant-date market price of the Company's common stock adjusted by expected level of achievement over the performance period. The fair value of the incentive stock options and non-qualified |
Income Taxes | Income Taxes - Deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The benefit of a tax position is recognized in the consolidated financial statements in the period during which, based on all available evidence, management believes it is more-likely-than-not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying Consolidated Balance Sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. |
Earnings per Share | Earnings Per Share - Basic earnings per share (“EPS”) computations are calculated utilizing the weighted average number of shares of common stock outstanding during the periods presented. Diluted EPS is calculated utilizing the weighted average number of shares of common stock outstanding adjusted for the effect of dilutive common stock equivalents. |
Comprehensive Income | Comprehensive Income - Other comprehensive income refers to revenues, expenses, and gains and losses that are not included in net income but rather are recorded directly in stockholders’ equity. Comprehensive income consists of net income, unrealized gains and losses on available-for-sale securities, and foreign currency translation adjustments. |
Accounting Pronouncements and Recently Issued Accounting Pronouncements | Accounting Pronouncements - Adopted in 2022 In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying accounting principles under GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met and to other derivative instruments if there is a change to the interest rates used for discounting, margining or contract price alignment. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. We adopted Topic 848 beginning in the first quarter of fiscal 2022 without any material impact on the Company's financial position and results of operations. Recently Issued Accounting Pronouncements - Pending Adoption |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Property Plant and Equipment Useful Lives | Building and building improvements 10 - 35 years Leasehold Improvements (1) Lease term Equipment and fixtures 3 - 15 years Software (2) 3 - 5 years Vehicles 5 years (1) The depreciation life for leasehold improvements is the lesser of the estimated useful life of the addition or the term of the related lease. (2) Capitalized costs of cloud software are reported in Other assets on the balance sheet and are amortized over an estimated useful life of 3 to 5 years. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consisted of the following (in thousands): December 31, 2022 December 31, 2021 Raw materials $ 12,670 $ 15,196 Packaging 3,611 3,641 Non-food finished goods 8,738 15,991 Finished goods 97,675 152,687 Reserve for obsolete inventory (3,838) (7,472) Total $ 118,856 $ 180,043 |
PROPERTY, PLANT AND EQUIPMENT (
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schdule of Property, Plant and Equipment | Property, plant, and equipment consisted of the following (in thousands): December 31, 2022 December 31, 2021 Land $ 565 $ 565 Building and leasehold improvements 25,905 23,518 Equipment and fixtures 49,260 42,708 Software 21,278 21,894 Vehicles 118 145 Property, plant and equipment - gross 97,126 88,830 Less: accumulated depreciation (39,941) (32,699) Property, plant and equipment - net $ 57,185 $ 56,131 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Liabilities | Accounts payable and accrued expenses consisted of the following (in thousands): December 31, 2022 December 31, 2021 Trade payables and accrued expenses $ 58,667 $ 70,894 OPTA VIA Coach compensation payable 23,633 28,733 Dividends payable 19,641 17,186 Accrued payroll and related taxes 13,581 24,940 Promotional sales incentive accruals 10,240 10,935 Deferred revenue 7,357 8,050 Sales tax payable 1,571 2,571 Total $ 134,690 $ 163,309 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted EPS | The following table sets forth the computation of basic and diluted EPS for the years ended December 31, 2022, 2021 and 2020 (in thousands, except per share data): 2022 2021 2020 Numerator: Net income $ 143,568 $ 164,031 $ 102,859 Denominator: Weighted average shares of common stock outstanding 11,195 11,705 11,771 Effect of dilutive common stock equivalents 81 108 79 Weighted average shares of common stock outstanding 11,276 11,813 11,850 Earnings per share - basic $ 12.82 $ 14.01 $ 8.74 Earnings per share - diluted $ 12.73 $ 13.89 $ 8.68 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock Option Activity | The number of stock options and weighted-average exercise prices as of December 31, 2022 and 2021 are as follows: 2022 2021 Awards Weighted-Average Exercise Price Awards Weighted-Average Exercise Price (awards in thousands) Outstanding at beginning of period 32 $ 54.98 61 $ 48.19 Exercised — — (29) 40.53 Forfeited — — — — Outstanding at end of the period 32 $ 54.98 32 $ 54.98 Exercisable at end of the period 28 $ 52.76 23 $ 49.50 |
Schedule of Restricted Stock Activity | A summary of outstanding restricted stock activity as of December 31, 2022 and 2021 are as follows: 2022 2021 Shares Weighted-Average Grant Date Fair Value Shares Weighted-Average Grant Date Fair Value (shares in thousands) Outstanding at beginning of period 43 $ 183.51 50 $ 116.06 Granted 38 176.60 22 264.58 Vested (20) 156.68 (26) 116.68 Forfeited (1) 188.60 (3) 169.47 Outstanding at end of the period 60 $ 187.94 43 $ 183.51 |
Schedule of Share-based Compensation Expense | The total expenses during the years ended December 31, 2022, 2021 and 2020 are as follows (in thousands): 2022 2021 2020 Shares Share-Based Compensation Expense Shares Share-Based Compensation Expense Shares Share-Based Compensation Expense Options and restricted stock 92 $ 5,167 75 $ 4,302 111 $ 3,493 Market and performance-based share awards granted in 2022 25 1,389 — — — — Performance-based share awards granted in 2021 15 2,595 15 1,986 — — Performance-based share awards granted in 2020 52 1,902 26 1,807 28 1,662 Performance-based share awards granted in 2019 — — — 1,808 17 1,641 Total share-based compensation 184 $ 11,053 116 $ 9,903 156 $ 6,796 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income | The following table sets forth the components of accumulated other comprehensive income, net of tax where applicable (in thousands): December 31, 2022 December 31, 2021 Foreign currency translation $ 24 $ 90 Unrealized gains on investment securities — 21 Accumulated other comprehensive income $ 24 $ 111 |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments, All Other Investments [Abstract] | |
Schedule of Cash and Financial Assets Measured at Fair Value on a Recurring Basis | The following tables present the Company’s cash and financial assets that are measured at fair value on a recurring basis for each of the hierarchy levels (in thousands): December 31, 2022 Cost Unrealized Accrued Estimated Cash & Cash Investment Cash and cash equivalents $ 87,691 $ — $ — $ 87,691 $ 87,691 $ — Total $ 87,691 $ — $ — $ 87,691 $ 87,691 $ — December 31, 2021 Cost Unrealized Accrued Estimated Cash & Cash Investment Cash and cash equivalents $ 94,824 $ — $ — $ 94,824 $ 94,824 $ — Level 1: Money market accounts 9,359 — — 9,359 9,359 — Government & agency securities 1,401 12 — 1,413 — 1,413 10,760 12 — 10,772 9,359 1,413 Level 2: Municipal bonds 3,880 9 59 3,948 — 3,948 Total $ 109,464 $ 21 $ 59 $ 109,544 $ 104,183 $ 5,361 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense | Income tax expense for the years ended December 31, 2022, 2021 and 2020 consisted of the following (in thousands): 2022 2021 2020 Current Federal $ 35,857 $ 49,433 $ 28,520 State 5,558 6,380 2,285 Total current 41,415 55,813 30,805 Deferred Federal (738) (3,424) 477 State (186) (291) (77) Foreign — — 201 Total deferred (924) (3,715) 601 Provision for income taxes $ 40,491 $ 52,098 $ 31,406 |
Schedule of Components of Total Income Tax Provision | Those amounts have been allocated to the following financial statement items: 2022 2021 2020 Income before provision for income taxes $ 40,491 $ 52,098 $ 31,406 Stockholders' equity, unrealized (losses) gains on investment securities & foreign currency (27) 66 14 Total provision for income taxes $ 40,464 $ 52,164 $ 31,420 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the United States federal statutory tax provision to the Company’s provision for income taxes for the years ended December 31, 2022, 2021 and 2020 (in thousands, except percentages): 2022 2021 2020 Statutory federal tax $ 38,621 21.0 % $ 45,405 21.0 % $ 28,196 21.0 % State income taxes, net of federal benefit 4,635 2.5 % 4,980 2.3 % 1,470 1.1 % Foreign taxes Hong Kong 75 0.0 % 91 0.0 % 94 0.1 % Singapore 28 0.0 % 32 0.0 % 107 0.1 % Share-based compensation - windfall (26) 0.0 % (1,835) (0.8) % (415) (0.3) % Research and development and jobs credits (819) (0.4) % (503) (0.2) % (370) (0.3) % Executive compensation 1,470 0.8 % 2,652 1.2 % 966 0.7 % Charitable donations (4,316) (2.3) % — 0.0 % — 0.0 % Valuation allowance 396 0.2 % 468 0.2 % 1,342 1.0 % Other permanent differences 427 0.2 % 808 0.4 % 16 0.0 % Provision for income taxes $ 40,491 22.0 % $ 52,098 24.1 % $ 31,406 23.4 % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets (liabilities) consisted of the following (in thousands): December 31, 2022 December 31, 2021 Reserves on inventory and sales $ 1,069 $ 2,022 Credit and loss carryforwards 3,713 3,052 Stock compensation 2,374 420 Accrued expenses and deferred costs 5,153 4,240 Inventory capitalization 1,781 3,514 Lease obligations 5,773 7,191 Capitalized research costs 2,502 — Charitable donations 1,862 — Other 190 — Valuation allowance (2,523) (1,904) Total deferred tax assets 21,894 18,535 Right-of-use assets (4,089) (5,375) Unrealized loss on investment securities (23) (6) Prepaid expenses (1,289) (1,175) Depreciation (11,165) (7,575) Other — — Total deferred tax liabilities (16,566) (14,131) Net deferred tax assets $ 5,328 $ 4,404 |
LEASES AND COMMITMENTS (Tables)
LEASES AND COMMITMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information related to the Company’s operating leases were as follows (in thousands): 2022 2021 Cash paid for amounts included in the measurements of lease liabilities Operating cash flow used in operating leases $ 7,199 $ 4,504 Right-of-use assets obtained in exchange for lease obligations Operating leases $ 101 $ 18,872 |
Schedule of Maturity of Company's Operating Lease Liabilities | The following table presents the maturity of the Company’s operating lease liabilities as of December 31, 2022 (in thousands): 2023 $ 6,243 2024 5,693 2025 5,825 2026 4,160 2027 2,553 Thereafter 2,858 Total lease payments $ 27,332 Less: imputed interest (1,281) Total $ 26,051 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | |||
Due from banks | $ 7.4 | $ 12.2 | |
Restructuring costs | 12.2 | ||
Advertising expense | 1.7 | 1.6 | $ 4.4 |
Research and development expense | 4.5 | $ 4.4 | $ 2.8 |
Contribution of Nonmonetary Assets to Charitable Organization | |||
Nonmonetary Transaction [Line Items] | |||
Donated inventory | $ 19 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES - Estimated Useful Lives of Assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Building and building improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 10 years |
Building and building improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 35 years |
Equipment and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Equipment and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 15 years |
Software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 3 years |
Software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 5 years |
Vehicles | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, useful life | 5 years |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 12,670 | $ 15,196 |
Packaging | 3,611 | 3,641 |
Non-food finished goods | 8,738 | 15,991 |
Finished goods | 97,675 | 152,687 |
Reserve for obsolete inventory | (3,838) | (7,472) |
Total | $ 118,856 | $ 180,043 |
PROPERTY, PLANT AND EQUIPMENT -
PROPERTY, PLANT AND EQUIPMENT - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | $ 97,126 | $ 88,830 |
Less: accumulated depreciation | (39,941) | (32,699) |
Property, plant and equipment - net | 57,185 | 56,131 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | 565 | 565 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | 25,905 | 23,518 |
Equipment and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | 49,260 | 42,708 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | 21,278 | 21,894 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment - gross | $ 118 | $ 145 |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation | $ 7.9 | $ 5.7 | $ 4.1 |
ACCOUNTS PAYABLE AND ACCRUED _3
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Trade payables and accrued expenses | $ 58,667 | $ 70,894 |
OPTAVIA Coach compensation payable | 23,633 | 28,733 |
Dividends payable | 19,641 | 17,186 |
Accrued payroll and related taxes | 13,581 | 24,940 |
Promotional sales incentive accruals | 10,240 | 10,935 |
Deferred revenue | 7,357 | 8,050 |
Sales tax payable | 1,571 | 2,571 |
Total | $ 134,690 | $ 163,309 |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Net income | $ 143,568 | $ 164,031 | $ 102,859 |
Denominator: | |||
Weighted average shares of common stock outstanding (in shares) | 11,195 | 11,705 | 11,771 |
Effect of dilutive common stock equivalents (in shares) | 81 | 108 | 79 |
Weighted average shares of common stock outstanding (in shares) | 11,276 | 11,813 | 11,850 |
Basic earnings per share | |||
Earnings per share - basic (in usd per share) | $ 12.82 | $ 14.01 | $ 8.74 |
Diluted earnings per share | |||
Earnings per share - diluted (in usd per share) | $ 12.73 | $ 13.89 | $ 8.68 |
EARNINGS PER SHARE - Narrative
EARNINGS PER SHARE - Narrative (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Stock Options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive awards | 0 | 0 | 1 |
Restricted Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive awards | 5 | 1 | 3 |
EQUITY (Details)
EQUITY (Details) - $ / shares | 12 Months Ended | |||
May 18, 2017 | Dec. 31, 2022 | Dec. 31, 2021 | Sep. 12, 2019 | |
Equity [Abstract] | ||||
Capital units authorized (in shares) | 21,500,000 | |||
Common stock, authorized (in shares) | 20,000,000 | 20,000,000 | ||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 | ||
Preferred stock, shares authorized (in shares) | 1,500,000 | |||
Preferred stock, par value (in usd per share) | $ 0.001 | |||
Common stock, issued (in shares) | 10,928,000 | 11,594,000 | ||
Preferred stock, issued (in shares) | 0 | |||
Increase in the number of shares authorized (in shares) | 600,000 | |||
Shares authorized for issuance (in shares) | 1,600,000 | |||
Additional shares authorized for repurchase (in shares) | 2,000,000 | |||
Stock repurchased (in shares) | 739,000 | 238,000 | ||
Remaining number of shares authorized to be repurchased (in shares) | 1,400,000 |
SHARE-BASED COMPENSATION - Narr
SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Awards granted (in shares) | 0 | 0 | |
Stock option exercised | 0 | 29,000 | |
Proceeds from stock options exercised | $ 0.8 | $ 1.6 | |
Shares withheld for employee taxes | 9,000 | 22,000 | 6,000 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Award expiration period | 10 years | ||
Share-based compensation, shares authorized under stock option plans, exercise price range, lower range limit (in usd per share) | $ 26.52 | ||
Share-based compensation, shares authorized under stock option plans, exercise price range, upper range limit (in usd per share) | $ 66.68 | ||
Weighted-average remaining contractual life of options outstanding | 51 months | ||
Aggregate intrinsic value of options outstanding | $ 2 | ||
Weighted-average remaining contractual life of options exercisable | 51 months | ||
Aggregate intrinsic value of options exercisable | $ 1.7 | ||
Employee service share based compensation nonvested awards | $ 0.1 | ||
Compensation cost recognition weighted average period | 1 month | ||
Intrinsic value of options exercised | $ 5.9 | $ 1.5 | |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 5 years | ||
Compensation cost recognition weighted average period | 20 months | ||
Share-based compensation arrangement, fair value of awards vested | $ 3.5 | 7 | 3.7 |
Total income tax benefit recognized related to restricted stock awards | 1.2 | $ 2.4 | $ 1.4 |
Unrecognized compensation costs | $ 6.2 | ||
Shares granted in period | 38,000 | 22,000 | |
Market and performance-based share awards | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional shares earned (percent) | 0% | ||
Market and performance-based share awards | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Additional shares earned (percent) | 250% | ||
Performance-Based Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost recognition weighted average period | 21 months | ||
Unrecognized compensation costs | $ 6.3 | ||
Shares granted in period | 92,000 |
SHARE-BASED COMPENSATION - Stoc
SHARE-BASED COMPENSATION - Stock Options Activity (Details) - $ / shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Awards | ||
Shares, Outstanding at beginning of period (in shares) | 32 | 61 |
Shares, Exercised (in shares) | 0 | (29) |
Shares, Forfeited (in shares) | 0 | 0 |
Shares, Outstanding at end of the period (in shares) | 32 | 32 |
Shares, Exercisable at end of the period (in shares) | 28 | 23 |
Weighted-Average Exercise Price | ||
Weighted-Average Exercise Price, Outstanding at beginning of period (in usd per share) | $ 54.98 | $ 48.19 |
Weighted-Average Exercise Price, Exercised (in usd per share) | 0 | 40.53 |
Weighted-Average Exercise Price, Forfeited (in usd per share) | 0 | 0 |
Weighted-Average Exercise Price, Outstanding at end of the period (in usd per share) | 54.98 | 54.98 |
Weighted-Average Exercise Price, Exercisable at end of the period (in usd per share) | $ 52.76 | $ 49.50 |
SHARE-BASED COMPENSATION - Rest
SHARE-BASED COMPENSATION - Restricted Stock Activity (Details) - Restricted Stock - $ / shares shares in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Shares | ||
Outstanding at beginning of period (in shares) | 43 | 50 |
Granted (in shares) | 38 | 22 |
Vested (in shares) | (20) | (26) |
Forfeited (in shares) | (1) | (3) |
Outstanding at end of the period (in shares) | 60 | 43 |
Weighted-Average Grant Date Fair Value | ||
Outstanding at beginning of period (in usd per share) | $ 183.51 | $ 116.06 |
Granted (in usd per share) | 176.60 | 264.58 |
Vested (in usds per share) | 156.68 | 116.68 |
Forfeited (in usd per share) | 188.60 | 169.47 |
Outstanding at end of the period (in usd per share) | $ 187.94 | $ 183.51 |
SHARE-BASED COMPENSATION - Expe
SHARE-BASED COMPENSATION - Expenses (Details) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 184 | 116 | 156 |
Share-Based Compensation Expense | $ 11,053 | $ 9,903 | $ 6,796 |
Options and restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 92 | 75 | 111 |
Share-Based Compensation Expense | $ 5,167 | $ 4,302 | $ 3,493 |
Market and performance-based share awards | Granted In 2022 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 25 | 0 | 0 |
Share-Based Compensation Expense | $ 1,389 | $ 0 | $ 0 |
Performance-based share awards | Granted In 2021 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 15 | 15 | 0 |
Share-Based Compensation Expense | $ 2,595 | $ 1,986 | $ 0 |
Performance-based share awards | Granted In 2020 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 52 | 26 | 28 |
Share-Based Compensation Expense | $ 1,902 | $ 1,807 | $ 1,662 |
Performance-based share awards | Granted In 2019 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares | 0 | 0 | 17 |
Share-Based Compensation Expense | $ 0 | $ 1,808 | $ 1,641 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME - Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign currency translation | $ 24 | $ 90 |
Unrealized gains on investment securities | 0 | 21 |
Accumulated other comprehensive income | $ 24 | $ 111 |
FINANCIAL INSTRUMENTS - Cash an
FINANCIAL INSTRUMENTS - Cash and Financial Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Cash and cash equivalents | $ 87,691 | $ 104,183 |
Cost, Total | 87,691 | 109,464 |
Unrealized Gains | 21 | |
Accrued Interest | 59 | |
Estimated Fair Value, Total | 87,691 | 109,544 |
Cash & Cash Equivalents | 87,691 | 104,183 |
Investment Securities | 0 | 5,361 |
Cash and cash equivalents | ||
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Cash and cash equivalents | 87,691 | 94,824 |
Estimated Fair Value, Cash and cash equivalents | 87,691 | 94,824 |
Cash & Cash Equivalents | $ 87,691 | 94,824 |
Level 1 | Money market accounts and government & agency securities | ||
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Total | 10,760 | |
Estimated Fair Value, Total | 10,772 | |
Level 1 | Money market accounts | ||
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Cash and cash equivalents | 9,359 | |
Estimated Fair Value, Cash and cash equivalents | 9,359 | |
Cash & Cash Equivalents | 9,359 | |
Level 1 | Government & agency securities | ||
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Investment securities | 1,401 | |
Unrealized Gains | 12 | |
Estimated Fair Value, Investment securities | 1,413 | |
Investment Securities | 1,413 | |
Level 2 | Municipal bonds | ||
Cash And Cash Equivalents And Marketable securities [Line Items] | ||
Cost, Investment securities | 3,880 | |
Unrealized Gains | 9 | |
Accrued Interest | 59 | |
Estimated Fair Value, Investment securities | 3,948 | |
Investment Securities | $ 3,948 |
FINANCIAL INSTRUMENTS - Narrati
FINANCIAL INSTRUMENTS - Narrative (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Investments, All Other Investments [Abstract] | |||
Realized loss or gains | $ 0 | $ 0 | $ 0 |
INCOME TAXES - Income Tax Expen
INCOME TAXES - Income Tax Expense from Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current | |||
Federal | $ 35,857 | $ 49,433 | $ 28,520 |
State | 5,558 | 6,380 | 2,285 |
Total current | 41,415 | 55,813 | 30,805 |
Deferred | |||
Federal | (738) | (3,424) | 477 |
State | (186) | (291) | (77) |
Foreign | 0 | 0 | 201 |
Total deferred | (924) | (3,715) | 601 |
Provision for income taxes | $ 40,491 | $ 52,098 | $ 31,406 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense (benefit), intraperiod tax allocation | $ 40,464 | $ 52,164 | $ 31,420 |
Operating loss carryforwards | $ 31,600 |
INCOME TAXES - Tax Provision Al
INCOME TAXES - Tax Provision Allocation to Financial Statement Items (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income before provision for income taxes | $ 40,491 | $ 52,098 | $ 31,406 |
Stockholders' equity, unrealized (losses) gains on investment securities & foreign currency | (27) | 66 | 14 |
Total provision for income taxes | $ 40,464 | $ 52,164 | $ 31,420 |
INCOME TAXES - Statutory Tax Ra
INCOME TAXES - Statutory Tax Rate and Effective Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Examination [Line Items] | |||
Statutory federal tax | $ 38,621 | $ 45,405 | $ 28,196 |
Statutory federal tax, effective tax rate, percent | 21% | 21% | 21% |
State income taxes, net of federal benefit | $ 4,635 | $ 4,980 | $ 1,470 |
State income taxes, net of federal benefit, effective tax rate, percent | 2.50% | 2.30% | 1.10% |
Share-based compensation - windfall | $ (26) | $ (1,835) | $ (415) |
Share-based compensation - windfall, effective tax rate, percent | 0% | (0.80%) | (0.30%) |
Research and development and jobs credits | $ (819) | $ (503) | $ (370) |
Research and development and jobs credits, effective tax rate, percent | (0.40%) | (0.20%) | (0.30%) |
Executive compensation | $ 1,470 | $ 2,652 | $ 966 |
Executive compensation, effective tax rate, percent | 0.80% | 1.20% | 0.70% |
Charitable donations | $ (4,316) | $ 0 | $ 0 |
Charitable donations, effective tax rate, percent | (2.30%) | 0% | 0% |
Valuation allowance | $ 396 | $ 468 | $ 1,342 |
Valuation allowance, effective tax rate, percent | 0.20% | 0.20% | 1% |
Other permanent differences | $ 427 | $ 808 | $ 16 |
Other permanent differences, effective tax rate, percent | 0.20% | 0.40% | 0% |
Provision for income taxes | $ 40,491 | $ 52,098 | $ 31,406 |
Provision for income taxes, effective tax rate, percent | 22% | 24.10% | 23.40% |
Hong Kong | |||
Income Tax Examination [Line Items] | |||
Foreign taxes | $ 75 | $ 91 | $ 94 |
Foreign taxes, effective tax rate, percent | 0% | 0% | 0.10% |
Singapore | |||
Income Tax Examination [Line Items] | |||
Foreign taxes | $ 28 | $ 32 | $ 107 |
Foreign taxes, effective tax rate, percent | 0% | 0% | 0.10% |
INCOME TAXES - Deferred Tax Ass
INCOME TAXES - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Disclosure [Abstract] | ||
Reserves on inventory and sales | $ 1,069 | $ 2,022 |
Credit and loss carryforwards | 3,713 | 3,052 |
Stock compensation | 2,374 | 420 |
Accrued expenses and deferred costs | 5,153 | 4,240 |
Inventory capitalization | 1,781 | 3,514 |
Lease obligations | 5,773 | 7,191 |
Capitalized research costs | 2,502 | 0 |
Charitable donations | 1,862 | 0 |
Other | 190 | 0 |
Valuation allowance | (2,523) | (1,904) |
Total deferred tax assets | 21,894 | 18,535 |
Right-of-use assets | (4,089) | (5,375) |
Unrealized loss on investment securities | (23) | (6) |
Prepaid expenses | (1,289) | (1,175) |
Depreciation | (11,165) | (7,575) |
Other | 0 | 0 |
Total deferred tax liabilities | (16,566) | (14,131) |
Net deferred tax assets | $ 5,328 | $ 4,404 |
LEASES AND COMMITMENTS - Narrat
LEASES AND COMMITMENTS - Narratives (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Leased Assets [Line Items] | |||
Operating lease expense | $ 6.7 | $ 5.6 | $ 3.6 |
Weighted average remaining lease term | 58 months | ||
Weighted average discount rate | 2.10% | ||
Inventories | |||
Operating Leased Assets [Line Items] | |||
Unconditional purchase obligation | $ 215.7 | ||
Minimum | Operating Lease Arrangement for Real Estate | |||
Operating Leased Assets [Line Items] | |||
Lease term | 18 months | ||
Minimum | Operating Lease Arrangement for Equipment | |||
Operating Leased Assets [Line Items] | |||
Lease term | 24 months | ||
Maximum | Operating Lease Arrangement for Real Estate | |||
Operating Leased Assets [Line Items] | |||
Lease term | 126 months | ||
Maximum | Operating Lease Arrangement for Equipment | |||
Operating Leased Assets [Line Items] | |||
Lease term | 203 months |
LEASES AND COMMITMENTS - Supple
LEASES AND COMMITMENTS - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | ||
Operating cash flow used in operating leases | $ 7,199 | $ 4,504 |
Operating leases | $ 101 | $ 18,872 |
LEASES AND COMMITMENTS - Future
LEASES AND COMMITMENTS - Future Minimum Lease Commitments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
2023 | $ 6,243 |
2024 | 5,693 |
2025 | 5,825 |
2026 | 4,160 |
2027 | 2,553 |
Thereafter | 2,858 |
Total lease payments | 27,332 |
Less: imputed interest | (1,281) |
Total | $ 26,051 |
DEBT (Details)
DEBT (Details) - Credit Agreement | 12 Months Ended | ||
Apr. 13, 2021 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |||
Maximum total net leverage ratio | 2.75 | ||
Minimum interest coverage ratio | 3.50 | ||
Borrowings outstanding | $ 0 | $ 0 | |
Eurodollar | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate ( as a percent ) | 1.25% | ||
Base Rate | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate ( as a percent ) | 0.25% | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee ( as a percent ) | 0.20% | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Commitment fee ( as a percent ) | 0.40% | ||
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 225,000,000 | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 20,000,000 | ||
Uncommitted Incremental Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 100,000,000 |