Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 24, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | FARO TECHNOLOGIES INC | |
Trading Symbol | FARO | |
Entity Central Index Key | 917,491 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 16,711,152 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 129,841 | $ 106,169 |
Short-term investments | 10,970 | 42,942 |
Accounts receivable, net | 60,449 | 61,364 |
Inventories, net | 59,044 | 51,886 |
Prepaid expenses and other current assets | 20,919 | 16,304 |
Total current assets | 281,223 | 278,665 |
Property and equipment: | ||
Machinery and equipment | 66,049 | 57,063 |
Furniture and fixtures | 6,863 | 6,099 |
Leasehold improvements | 19,588 | 18,778 |
Property and equipment, at cost | 92,500 | 81,940 |
Less: accumulated depreciation and amortization | (60,189) | (50,262) |
Property and equipment, net | 32,311 | 31,678 |
Goodwill | 52,567 | 46,744 |
Intangible assets, net | 22,983 | 22,279 |
Service and sales demonstration inventory, net | 35,250 | 29,136 |
Deferred income tax assets, net | 14,498 | 14,307 |
Other long-term assets | 1,049 | 905 |
Total assets | 439,881 | 423,714 |
Current liabilities: | ||
Accounts payable | 11,964 | 11,126 |
Accrued liabilities | 22,507 | 24,572 |
Income taxes payable | 0 | 618 |
Current portion of unearned service revenues | 29,080 | 27,422 |
Customer deposits | 3,065 | 2,872 |
Total current liabilities | 66,616 | 66,610 |
Unearned service revenues - less current portion | 12,665 | 13,813 |
Deferred income tax liabilities | 1,683 | 1,409 |
Other long-term liabilities | 2,191 | 2,225 |
Total liabilities | 83,155 | 84,057 |
Commitments and contingencies - See Note 16 | ||
Shareholders’ equity: | ||
Common stock - par value $.001, 50,000,000 shares authorized; 18,197,628 and 18,170,267 issued, respectively; 16,711,152 and 16,680,791 outstanding, respectively | 18 | 18 |
Additional paid-in capital | 218,242 | 212,602 |
Retained earnings | 179,682 | 183,436 |
Accumulated other comprehensive loss | (9,387) | (24,561) |
Common stock in treasury, at cost; 1,486,476 and 1,489,476 shares, respectively | (31,829) | (31,838) |
Total shareholders’ equity | 356,726 | 339,657 |
Total liabilities and shareholders’ equity | $ 439,881 | $ 423,714 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 18,197,628 | 18,170,267 |
Common stock, shares outstanding | 16,711,152 | 16,680,791 |
Treasury stock, shares | 1,486,476 | 1,489,476 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Sales | ||||
Product | $ 68,563 | $ 61,280 | $ 193,476 | $ 182,232 |
Service | 21,687 | 18,320 | 61,018 | 51,654 |
Total sales | 90,250 | 79,600 | 254,494 | 233,886 |
Cost of Sales | ||||
Product | 26,673 | 25,880 | 78,186 | 74,938 |
Service | 11,543 | 11,042 | 33,765 | 29,665 |
Total cost of sales (exclusive of depreciation and amortization, shown separately below) | 38,216 | 36,922 | 111,951 | 104,603 |
Gross Profit | 52,034 | 42,678 | 142,543 | 129,283 |
Operating Expenses: | ||||
Selling and marketing | 25,990 | 19,781 | 74,884 | 56,399 |
General and administrative | 10,307 | 10,747 | 32,883 | 31,139 |
Depreciation and amortization | 4,368 | 3,381 | 12,075 | 9,733 |
Research and development | 9,019 | 7,928 | 26,530 | 22,344 |
Total operating expenses | 49,684 | 41,837 | 146,372 | 119,615 |
Income (loss) from operations | 2,350 | 841 | (3,829) | 9,668 |
Other (income) expense | ||||
Interest income, net | (78) | (21) | (249) | (119) |
Other (income) expense, net | (147) | (167) | 320 | 824 |
Income (loss) before income tax expense (benefit) | 2,575 | 1,029 | (3,900) | 8,963 |
Income tax expense (benefit) | 947 | (61) | (442) | 1,401 |
Net income (loss) | $ 1,628 | $ 1,090 | $ (3,458) | $ 7,562 |
Net income (loss) per share - Basic (in dollars per share) | $ 0.10 | $ 0.07 | $ (0.21) | $ 0.45 |
Net income (loss) per share - Diluted (in dollars per share) | $ 0.10 | $ 0.07 | $ (0.21) | $ 0.45 |
Weighted average shares - Basic | 16,708,446 | 16,674,176 | 16,697,729 | 16,647,662 |
Weighted average shares - Diluted | 16,796,518 | 16,701,617 | 16,697,729 | 16,669,550 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 1,628 | $ 1,090 | $ (3,458) | $ 7,562 |
Currency translation adjustments, net of income tax | 3,875 | 1,339 | 15,174 | 6,165 |
Comprehensive income | $ 5,503 | $ 2,429 | $ 11,716 | $ 13,727 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating activities: | ||
Net (loss) income | $ (3,458) | $ 7,562 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 12,075 | 9,733 |
Stock-based compensation | 4,823 | 4,068 |
Provision for bad debts | 321 | 727 |
Loss on disposal of assets | 263 | 814 |
Provision for excess and obsolete inventory | 1,271 | 2,937 |
Deferred income tax expense (benefit) | 224 | (734) |
Income tax benefit from exercise of stock options | 0 | (354) |
Decrease (increase) in: | ||
Accounts receivable | 3,701 | 12,850 |
Inventories | (11,450) | (8,689) |
Prepaid expenses and other current assets | (3,834) | (995) |
(Decrease) increase in: | ||
Accounts payable and accrued liabilities | (2,774) | 1,128 |
Income taxes payable | (598) | 0 |
Customer deposits | (6) | (1,155) |
Unearned service revenues | (1,326) | 559 |
Net cash (used in) provided by operating activities | (768) | 28,451 |
Investing activities: | ||
Proceeds from sale of investments | 32,000 | 11,000 |
Purchases of property and equipment | (6,081) | (5,272) |
Payments for intangible assets | (1,345) | (1,440) |
Acquisition of business | (5,496) | (20,911) |
Net cash provided by (used in) investing activities | 19,078 | (16,623) |
Financing activities: | ||
Payments on capital leases | (6) | (6) |
Payment of contingent consideration for acquisitions | (521) | (434) |
Income tax benefit from exercise of stock options | 0 | 354 |
Proceeds from issuance of stock | 387 | 519 |
Net cash (used in) provided by financing activities | (140) | 433 |
Effect of exchange rate changes on cash and cash equivalents | 5,502 | 1,732 |
Increase in cash and cash equivalents | 23,672 | 13,993 |
Cash and cash equivalents, beginning of period | 106,169 | 107,356 |
Cash and cash equivalents, end of period | $ 129,841 | $ 121,349 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | DESCRIPTION OF BUSINESS FARO Technologies, Inc. and its subsidiaries (collectively “FARO,” the “Company,” “us,” “we” or “our”) is a global technology company that designs, develops, manufactures, markets and supports software driven, three-dimensional (“3D”) measurement, imaging and realization systems. This technology permits high-precision 3D measurement, imaging and comparison of parts and complex structures within production and quality assurance processes. Our devices are used for inspection of components and assemblies, rapid prototyping, reverse engineering, documenting large volume or structures in 3D, surveying and construction, as well as for investigation and reconstruction of accident sites or crime scenes. We sell the majority of our products through a direct sales force across a broad number of customers in a range of manufacturing, industrial, architecture, surveying, building information modeling, construction, public safety forensics, cultural heritage and other applications. Our FaroArm ® , FARO Laser ScanArm ® , FARO Gage ® , FARO Laser Tracker TM , FARO Laser Projector, FARO Cobalt Array Imager, and their companion CAM2 ® and BuildIT software solutions, provide for Computer-Aided Design (“CAD”) based inspection, factory-level statistical process control, high-density surveying and laser-guided assembly and production. Together, these products integrate the measurement, quality inspection, and reverse engineering functions with CAD and 3D software to improve productivity, enhance product quality, and decrease rework and scrap in the manufacturing process, mainly supporting applications in our Factory Metrology vertical. Our FARO Focus and FARO Scanner Freestyle 3D X laser scanners, and their companion SCENE, FARO PointSense, and FARO public safety forensics software offerings, are utilized for a wide variety of 3D modeling, documentation and high-density surveying applications in our Construction Building Information Modeling-Construction Information Management (“Construction BIM-CIM”) and Public Safety Forensics verticals. Our FARO Laser ScanArm ® , FARO Cobalt Array Imager, FARO Scanner Freestyle 3D X laser scanners and their companion SCENE software also enable a fully digital workflow used to capture real world geometry for the purpose of empowering design, enabling innovation, and speeding up the design cycle, supporting our Product Design vertical. FARO Visual Inspect TM enables large, complex 3D CAD data to be transferred to a tablet device and then used for mobile visualization and comparison to real world conditions, facilitating in-process inspection, assembly, guidance and positioning for applications in our Factory Metrology and Construction BIM-CIM verticals. Our line of galvanometer-based scan heads and laser scan controllers are used in a variety of laser applications and are integrated into larger components and systems. We report our segment information in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 280, Segment Reporting (“FASB ASC Topic 280”). During fiscal 2016, we evaluated our reportable segments based on our new internal management structure organized around operating activities and the changes implemented in connection with our initiatives to reorganize our business around certain vertical markets. We evaluate business performance based upon several metrics, using revenue growth and segment profit as the primary financial measures. As a result of this assessment, we now report our activities in the following three reportable segments: • The Factory Metrology reporting segment provides solutions for manual and automated measurement and inspection in an industrial or manufacturing environment. Applications include alignment, part inspection, dimensional analysis, first article inspection, incoming and in-process inspection, machine calibration, non-contact inspection, robot calibration, tool building and set-up, and assembly guidance. • The Construction BIM-CIM reporting segment provides solutions for as-built data capturing and 3D visualization in building information modeling and construction information management applications, allowing our customers in the architecture, engineering and construction markets to quickly and accurately extract two-dimensional (“2D”) and 3D measurement points. Applications include as-built documentation, construction monitoring, surveying, asset and facility management, and heritage preservation. • The Other reporting segment includes our Product Design, Public Safety Forensics and 3D Machine Vision (formerly known as 3D Solutions) operating segments. Our Product Design operating segment provides advanced 3D solutions to assist in the engineering or design of a movable object, enabling a full digital workflow for applications that include reverse engineering and virtual simulation. Our Public Safety Forensics operating segment provides solutions to public safety officials and professionals to capture environmental or situational scenes in 2D and 3D for crime, crash and fire scene investigations and environmental safety evaluations. Our 3D Machine Vision operating segment provides solutions to customers who require customized 3D measurement and realization solutions not otherwise addressed by our off-the-shelf product offerings. All operating segments that do not meet the criteria to be reportable segments are aggregated in the Other reporting segment and have been combined based on the aggregation criteria and quantitative thresholds in accordance with the provisions of FASB ASC Topic 280. There has been no change in our total consolidated financial condition or results of operations previously reported as a result of the change in our reportable segments. The amounts related to our segment information for the three and nine months ended September 30, 2016 have been restated throughout this Quarterly Report on Form 10-Q to reflect the change in reporting segments. Each of our reporting segments employs consistent accounting policies. See Note 15 – Segment Reporting for further information. |
Principles of Consolidation
Principles of Consolidation | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | PRINCIPLES OF CONSOLIDATION Our condensed consolidated financial statements include the accounts of FARO Technologies, Inc. and its subsidiaries, all of which are wholly owned. All intercompany transactions and balances have been eliminated. The financial statements of our foreign subsidiaries are translated into U.S. dollars using exchange rates in effect at period-end for assets and liabilities and average exchange rates during each reporting period for results of operations. Adjustments resulting from financial statement translations are reflected as a separate component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in income. |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements and notes thereto have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These condensed consolidated financial statements include all normal recurring accruals and adjustments considered necessary by management for a fair presentation in conformity with U.S. GAAP. Preparing financial statements 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. The condensed consolidated results of operations for the three and nine months ended September 30, 2017 are not necessarily indicative of results that may be expected for the year ending December 31, 2017 or any future interim period. The information included in this Quarterly Report on Form 10-Q, including the interim condensed consolidated financial statements and the accompanying notes, should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016 . The accompanying December 31, 2016 condensed consolidated balance sheet has been derived from those audited consolidated financial statements. |
Reclassifications
Reclassifications | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Reclassifications | RECLASSIFICATIONS Certain prior period amounts have been reclassified in the accompanying condensed consolidated financial statements to conform to the current period presentation. Certain prior period stock compensation expenses were reclassified between cost of product sales, cost of service sales, selling and marketing, general and administrative, and research and development expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended September 30, 2016 to reflect the appropriate departmental costs. In addition, deferred income tax assets, net were reclassified from current to non-current in our condensed consolidated balance sheet as of December 31, 2016 as a result of adopting Accounting Standards Update ("ASU") No. 2015-17, Income Taxes (Topic 740: Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"). See Note 5 – Impact of Recently Issued Accounting Pronouncements for further details. |
Impact of Recently Issued Accou
Impact of Recently Issued Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Impact of Recently Issued Accounting Pronouncements | IMPACT OF RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In January 2017, the FASB issued ASU No. 2017-04, Intangible - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which is intended to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the current guidance, performance of Step 2 requires us to calculate the implied fair value of goodwill by following procedures that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Under the new guidance, we will perform our goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge will be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value up to the amount of the goodwill allocated to the reporting unit. The new guidance also eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform Step 2 of the goodwill impairment test if it fails the qualitative assessment. As a result, all reporting units will be subject to the same impairment assessment. We will still have the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU 2017-04 becomes effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for annual or any interim goodwill impairment tests after January 1, 2017. The amendments in this ASU will be applied on a prospective basis. Disclosure of the nature and reason for the change in accounting principle is required upon transition. This disclosure is required in the first annual period and in the interim period within the first annual period when we initially adopt the amendments in this ASU. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”) in order to clarify the definition of a business and provide additional guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Currently, ASC Topic 805 recognizes three elements of a business: inputs, processes, and outputs. While an integrated set of assets and activities (collectively referred to as a “set”) that is a business usually has outputs, outputs are not required to be present. Additionally, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs. ASU 2017-01 provides a screen to determine when a set is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If the screen is not met, the new guidance (1) requires that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) removes the evaluation of whether a market participant could replace missing elements. The new guidance provides a framework to assist entities in evaluating whether both an input and a substantive process are present. This framework includes two sets of criteria to consider that depend on whether a set has outputs. Although outputs are not required for a set to be a business, outputs generally are a key element of a business. ASU 2017-01 provides more stringent criteria for sets without outputs and more narrowly defines the term output. ASU 2017-01 becomes effective for annual periods beginning after December 15, 2017, including interim periods within those periods, and will be applied prospectively commencing on the effective date. No disclosures are required at transition. Early application is permitted under certain circumstances. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory (“ASU 2016-16”), which removes the prohibition in ASC Topic 740, Income Taxes , against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. This ASU requires the tax effects of intra-entity transactions, other than sales of inventory, to be recognized when the transfer occurs, instead of deferred until the transferred asset is sold to a third party or otherwise recovered through use of the asset. The new guidance must be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption and is effective for annual periods beginning after December 15, 2017, and interim periods therein, with early adoption permitted. Currently, we do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. We will continue to monitor our business for changes that could be impacted due to the adoption of this guidance. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, and interim periods therein. Early adoption is permitted. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases ( Topic 842) ( “ASU 2016-02”), which is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 must be applied on a modified retrospective basis and is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. We are currently evaluating the impact of adopting this standard on our consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: (Topic 606) (“ASU 2014-09”), amending its accounting guidance related to revenue recognition. Under this ASU and subsequently issued amendments, revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The ASU and subsequently issued amendments to it are effective for us on January 1, 2018 and permit the use of either the full retrospective or modified retrospective method. We are currently evaluating the effect that this guidance will have on our consolidated financial statements by analyzing both transactional and analytical data for each of our revenue streams. The following is a status of our evaluation of impacts by significant revenue stream: • Measurement equipment and related software: Under current accounting guidance, sales of measurement, imaging and realization equipment and related software sales are generally recognized upon shipment, as we consider the earnings process complete as of the shipping date. The related software sold with our measurement, imaging and realization equipment functions together with such equipment to deliver the tangible product’s essential functionality. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to our measurement, imaging and realization equipment and related software. • Extended warranties: Under current accounting guidance, extended warranty sales are recognized on a straight-line basis over the term of the warranty. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to extended warranties. • Software: Under current accounting guidance, software only sales are recognized when no further significant production, modification or customization of the software is required and when the following criteria are met: persuasive evidence of a sales agreement exists, delivery has occurred, and the sales price is fixed or determinable and deemed collectible. These software arrangements generally include short-term maintenance that is considered post-contract support. Maintenance renewals, when sold, are recognized on a straight-line basis over the term of the maintenance agreement. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to software only sales and maintenance renewals. Currently, we recognize sales commission expense as incurred. Under the new guidance, we expect to capitalize the commission expense for those sales arrangements that extend beyond one year and amortize such costs ratably over the term of the contract. As a result, we expect to have an increase in deferred costs on our consolidated balance sheet upon the adoption of the new guidance; however, we are still evaluating the expected impact of this change on our consolidated balance sheet. We do not expect that this will result in a material change to our results of operations or cash flows. We plan to adopt this guidance utilizing the modified retrospective method and plan to apply the modified retrospective method only to contracts that are not completed as of the date of initial adoption, an option that is available under ASC Topic 606. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), simplifying several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 became effective for annual periods beginning after December 15, 2016, and interim periods therein (our fiscal year 2017). We adopted ASU 2016-09 effective January 1, 2017. Under the new guidance, excess tax benefits that were not previously recognized because the related tax deduction had not reduced current taxes payable are to be recorded on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period in which the new guidance is adopted. Historically, we recognized all excess tax benefits when an option was exercised or a share vested since we did not have a U.S. net operating loss carryforward. Therefore, no adjustment to retained earnings for prior excess tax benefits was required upon adoption. Under the new guidance, all tax-related cash flows resulting from share-based payments are reported as operating activities in the statement of cash flows. This approach incorporates the net of the inflow and outflow from all tax-related cash flows resulting from share-based payments in the deferred income tax expense (benefit) line item and presents it along with other income tax cash flows as operating activities in the statement of cash flows. Effective January 1, 2017, we adopted this portion of the guidance on a prospective basis and therefore did not restate the prior period's condensed consolidated statement of cash flows. We also elected to account for forfeitures related to the service condition-based awards as they occur effective January 1, 2017, which is a change from previous guidance that required an estimate of forfeitures. However, we continue to assess performance condition-based awards quarterly as required. In adopting the new policy using a modified retrospective approach, we assessed the cumulative effect adjustment and recorded to retained earnings the difference between the amount of compensation cost previously recorded and the amount that would have been recorded without assuming forfeitures. The cumulative effect adjustment recorded to retained earnings, net of income tax benefit, was not material. In November 2015, the FASB issued ASU 2015-17, which requires that deferred tax liabilities and assets be classified as noncurrent in a classified balance sheet. ASU 2015-17 became effective for us on January 1, 2017. We adopted this guidance on a retrospective basis, which resulted in the reclassification of current deferred tax assets totaling approximately $7.6 million as of December 31, 2016 from current to non-current in these condensed consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory (“ASU 2015-11”), which changes the measurement principle for inventory from the lower of cost or market to the lower of cost or net realizable value. ASU 2015-11 defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The new guidance must be applied on a prospective basis and became effective for fiscal years beginning after December 15, 2016 (i.e., our fiscal year 2017), and interim periods within those years, with early adoption permitted. We adopted ASU 2015-11 effective January 1, 2017. The adoption of this guidance did not have a material impact on our condensed consolidated financial statements. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | STOCK-BASED COMPENSATION Stock-based compensation expense reflects the fair value of stock-based awards measured at the grant date and is recognized over the requisite service period. We have three compensation plans that provide for the granting of stock options and other share-based awards to key employees and non-employee members of the Board of Directors (the “Board”). The 2004 Equity Incentive Plan (“2004 Plan”), the 2009 Equity Incentive Plan (“2009 Plan”), and the 2014 Equity Incentive Plan (“2014 Plan”) provide for granting options, restricted stock, restricted stock units or stock appreciation rights to employees and non-employee directors. In May 2014, our shareholders approved the 2014 Plan, authorizing us to grant awards for up to 1,974,543 shares of common stock, as well as any shares underlying awards outstanding under the 2004 Plan and 2009 Plan as of the effective date of the 2014 Plan that thereafter terminate or expire unexercised or are canceled, forfeited or lapse for any reason. Under the terms of the 2014 Plan, we are not permitted to make any further grants under the 2004 Plan or the 2009 Plan. Upon election to the Board, each non-employee director receives an initial equity grant of shares of restricted common stock with a value equal to $100,000 , calculated using the closing share price on the date of the non-employee director’s election to the Board. The initial restricted stock grant vests on the third anniversary of the grant date, subject to the non-employee director’s continued membership on the Board. Annually, the non-employee directors are granted restricted shares with a value equal to $ 100,000 on the first business day following the annual meeting of shareholders, calculated using the closing price of our common stock on that day. In addition, the Lead Director is annually granted restricted shares with a value equal to $40,000 on the first business day following the annual meeting of shareholders, calculated using the closing price of our common stock on that day. The shares of restricted stock granted annually to our non-employee directors and our Lead Director vest on the day prior to the following year’s annual meeting date, subject to the non-employee director’s continued membership on the Board. We record compensation cost associated with our restricted stock grants on a straight-line basis over the vesting term. Annually, upon approval by our Compensation Committee, we grant stock options and restricted stock units to certain employees. We also grant stock options and restricted stock units to certain new employees throughout the year. The fair value of these stock-based awards is determined by using (a) the current market price of our common stock on the grant date in the case of restricted stock units or (b) the Black-Scholes option valuation model in the case of stock options. Our annual grants in March 2017 and March 2016 consisted of stock options and restricted stock units that are subject to only time-based vesting. The number of stock options and/or restricted stock units granted was based on the employee’s individual objectives, performance against operational metrics assigned to the employee and overall contribution over the last year. The stock options vest in three equal annual installments beginning one year after the grant date. The restricted stock unit awards vest in full on the three -year anniversary of the grant date. The fair value of these stock-based awards is determined by using (a) the Black-Scholes option valuation model in the case of stock options or (b) the current market price of our common stock on the grant date in the case of restricted stock units. In 2015, we granted performance-based stock options and restricted stock units to certain executives. These awards vest in three annual installments beginning one year after the grant date if the applicable performance measures or strategic objectives are achieved. The related stock-based compensation expense is recognized over the requisite service period, taking into account the probability that we will satisfy the performance measures or strategic objectives. In addition to certain strategic objectives, the performance-based stock options and restricted stock units granted in 2015 are earned and vest based upon (1) our achievement of specified revenue and earnings per share targets, and (2) our total shareholder return (“TSR”) relative to the TSR attained by companies within our defined peer group. Due to the application of TSR to certain performance-based grants, the fair value of these awards is determined using the Monte Carlo Simulation valuation model. We expense these market condition awards over the three -year vesting period regardless of the value the award recipients ultimately receive. In February 2017, our Compensation Committee determined that 9,616 performance-based stock options and 300 restricted stock units were earned for the 2016 performance period and 19,362 stock options and 604 restricted stock units were unearned, as the required metrics were not achieved. The Black-Scholes option valuation model incorporates assumptions as to stock price volatility, the expected life of options or awards, a risk-free interest rate and dividend yield. The weighted-average grant-date fair value of the stock options that were granted during the nine months ended September 30, 2017 and September 30, 2016 and valued using the Black-Scholes option valuation model was $ 14.51 and $12.42 per option, respectively. For stock options granted during the nine months ended September 30, 2017 and September 30, 2016 valued using the Black-Scholes option valuation model, we used the following assumptions: Nine Months Ended September 30, September 30, Risk-free interest rate 1.88% - 2.02% 1.06% - 1.21% Expected dividend yield — % — % Expected term of option 5 years 4 years Expected volatility 45.2 % 46.7% - 47.0% Weighted-average expected volatility 45.2 % 46.7 % Historical information was the primary basis for the selection of the expected dividend yield, expected volatility and the expected lives of the options. The risk-free interest rate was based on the yields of U.S. zero coupon issues and U.S. Treasury issues, with a term equal to the expected life of the option being valued. A summary of stock option activity and weighted-average exercise prices during the nine months ended September 30, 2017 follows: Options Weighted- Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Outstanding at January 1, 2017 1,090,160 $ 48.02 Granted 267,039 34.79 Forfeited or expired (72,015 ) 44.39 Exercised (14,520 ) 26.68 Unearned performance-based options (19,362 ) 59.97 Outstanding at September 30, 2017 1,251,302 $ 45.47 4.2 $ 2,235 Options exercisable at September 30, 2017 963,891 $ 42.82 3.0 $ 612 The total intrinsic value of stock options exercised during each of the three months ended September 30, 2017 and September 30, 2016 was less than $0.1 million . For the nine months ended September 30, 2017 and September 30, 2016 , the total intrinsic value of stock options exercised in the respective periods was $0.1 million and $1.7 million . The fair value of stock options vested during each of the three months ended September 30, 2017 and September 30, 2016 was less than $0.1 million . The fair value of stock options vested during the nine months ended September 30, 2017 and September 30, 2016 was $3.0 million and $ 3.5 million , respectively. The following table summarizes the restricted stock and restricted stock unit activity and weighted average grant-date fair values for the nine months ended September 30, 2017 : Shares Weighted-Average Grant Date Fair Value Non-vested at January 1, 2017 150,682 $ 33.39 Granted 152,207 35.42 Forfeited (20,844 ) 33.84 Vested (21,101 ) 33.65 Unearned performance-based awards (604 ) 52.83 Non-vested at September 30, 2017 260,340 $ 34.60 We recorded total stock-based compensation expense of $1.6 million and $1.4 million for the three months ended September 30, 2017 and September 30, 2016 , respectively, and $4.8 million and $4.1 million for the nine months ended September 30, 2017 and September 30, 2016 , respectively. As of September 30, 2017 , there was $11.0 million of total unrecognized stock-based compensation expense related to non-vested stock-based compensation arrangements. The expense is expected to be recognized over a weighted average period of 2.0 years. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 9 Months Ended |
Sep. 30, 2017 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | CASH AND CASH EQUIVALENTS We consider cash on hand and all short-term, highly liquid investments that have original maturities of three months or less at the time of purchase to be cash and cash equivalents. |
Short Term Investments
Short Term Investments | 9 Months Ended |
Sep. 30, 2017 | |
Investments Schedule [Abstract] | |
Short Term Investments | SHORT TERM INVESTMENTS Short-term investments at September 30, 2017 consisted of U.S Treasury Bills totaling $11.0 million that mature through January 11, 2018. Short-term investments at December 31, 2016 consisted of U.S. Treasury Bills totaling $42.9 million that matured through June 15, 2017. The interest rate on the U.S. Treasury Bills is less than one percent. The investments are classified as held-to-maturity and recorded at cost plus accrued interest, which approximates fair value. The fair value of the U.S. Treasury Bills at September 30, 2017 and December 31, 2016 were classed as Level 1, as they are traded with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis. For further discussion of fair value, refer to Note 14 – Fair Value of Financial Instruments. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | ACCOUNTS RECEIVABLE Accounts receivable consist of the following: As of As of Accounts receivable $ 62,489 $ 63,193 Allowance for doubtful accounts (2,040 ) (1,829 ) Total $ 60,449 $ 61,364 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | INVENTORIES Inventories are stated at the lower of cost or net realizable value using the first-in first-out (FIFO) method. We have three principal categories of inventory: 1) manufactured product to be sold; 2) sales demonstration inventory - completed product used to support our sales force and demonstrations; and 3) service inventory - completed product and parts used to support our service department. Shipping and handling costs are classified as a component of cost of sales in our condensed consolidated statements of operations. Sales demonstration inventory is held by our sales representatives for up to three years , at which time it would be refurbished and transferred to finished goods as used equipment, stated at the lower of cost or net realizable value. Management expects these refurbished units to remain in finished goods inventory and to be sold within 12 months at prices that may produce reduced gross margins. Service inventory is used to provide a temporary replacement product to a customer covered by a premium warranty when the customer’s unit requires service or repair and as training equipment. Service inventory is available for sale; however, management does not expect service inventory to be sold within 12 months and, as such, classifies this inventory as a long-term asset. Service inventory that we utilize for training or repairs and which we deem as no longer available for sale is transferred to fixed assets at the lower of cost or net realizable value and depreciated over the remaining life, typically three years. Inventories consist of the following: As of As of Raw materials $ 39,285 $ 36,760 Finished goods 19,759 15,126 Inventories, net $ 59,044 $ 51,886 Service and sales demonstration inventory, net $ 35,250 $ 29,136 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic earnings per share is computed by dividing net (loss) or income by the weighted average number of shares outstanding. Diluted earnings per share is computed by also considering the impact of potential common stock on both net income and the weighted average number of shares outstanding. Our potential common stock consists of employee and director stock options, restricted stock units and performance-based awards. Our potential common stock is included in the diluted earnings per share calculation when doing so would not be anti-dilutive. Performance-based awards are included in the computation of diluted earnings per share only to the extent that the underlying performance conditions (and any applicable market condition) (i) are satisfied as of the end of the reporting period or (ii) would be considered satisfied if the end of the reporting period were the end of the related contingency period and the result would be dilutive under the treasury stock method. When we report a net loss, which we did for the nine months ended September 30, 2017 , the calculation of diluted net loss per share excludes our potential common stock, as the effect would be anti-dilutive. For the three and nine months ended September 30, 2017 , there were approximately 1,143,523 and 1,145,632 shares, respectively, issuable upon the exercise of options and the contingent vesting of performance-based awards that were excluded from the dilutive calculations, as they were anti-dilutive. For the three and nine months ended September 30, 2016 , there were approximately 1,002,856 and 1,042,366 , respectively, shares issuable upon the exercise of options and the contingent vesting of performance-based awards that were excluded from the dilutive calculations, as they were anti-dilutive. A reconciliation of the number of common shares used in the calculation of basic and diluted earnings per share (“EPS”) is presented below: Three Months Ended September 30, 2017 September 30, 2016 Shares Per-Share Amount Shares Per-Share Amount Basic EPS 16,708,446 $ 0.10 16,674,176 $ 0.07 Effect of dilutive securities 88,072 — 27,441 — Diluted EPS 16,796,518 $ 0.10 16,701,617 $ 0.07 Nine months ended September 30, 2017 September 30, 2016 Shares Per-Share Amount Shares Per-Share Amount Basic EPS 16,697,729 $ (0.21 ) 16,647,662 $ 0.45 Effect of dilutive securities — — 21,888 — Diluted EPS 16,697,729 $ (0.21 ) 16,669,550 $ 0.45 |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | ACCRUED LIABILITIES Accrued liabilities consist of the following: As of As of Accrued compensation and benefits $ 12,347 $ 13,649 Accrued warranties 2,584 2,594 Professional and legal fees 1,442 1,775 Taxes other than income 2,697 4,026 Other accrued liabilities 3,437 2,528 $ 22,507 $ 24,572 Activity related to accrued warranties was as follows: Nine Months Ended September 30, 2017 September 30, 2016 Balance, beginning of period $ 2,594 $ 2,309 Provision for warranty expense 2,606 2,292 Fulfillment of warranty obligations (2,616 ) (1,925 ) Balance, end of period $ 2,584 $ 2,676 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES For the three months ended September 30, 2017 , we recorded income tax expense of $0.9 million compared with an income tax benefit of $0.1 million for the three months ended September 30, 2016 . Our effective tax rate was 36.8% for the three months ended September 30, 2017 compared with a 5.9% benefit in the prior year period. The change in our income tax expense (benefit) and the increase in our effective tax rate were primarily due to a shift in the geographic mix of pretax income expected for the full year 2017. For the nine months ended September 30, 2017 , we recorded an income tax benefit of $0.4 million compared with income tax expense of $1.4 million for the nine months ended September 30, 2016 . This change of $1.8 million was due to a pretax loss during the nine months ended September 30, 2017 compared to pretax income in the same period of 2016. Our effective tax rate decreased by 4.3 percentage points to 11.3% for the nine months ended September 30, 2017 from 15.6% for the same period of 2016. The change was primarily due to the pretax loss during the nine months ended September 30, 2017 compared with pretax income during the same period of 2016 and a shift in the geographic mix of pretax income expected for the full year 2017. Our effective tax rate continued to be lower than the statutory tax rate in the United States, mainly due to our global footprint in foreign jurisdictions with lower tax rates. However, our effective tax rate could be impacted positively or negatively by geographic changes in the manufacturing or sales of our products and the resulting effect on taxable income in each jurisdiction. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | FAIR VALUE OF FINANCIAL INSTRUMENTS Our financial instruments include cash and cash equivalents, short-term investments, accounts receivable, customer deposits, accounts payable and accrued liabilities. The carrying amounts of such financial instruments approximate their fair value due to the short-term nature of these instruments. Assets and liabilities measured at fair value on a recurring basis are categorized in the tables below based upon the lowest level of significant input to the valuations: As of September 30, 2017 Level 1 Level 2 Level 3 Assets: Short-term investments (1) $ 10,970 $ — $ — Total $ 10,970 $ — $ — Liabilities: Contingent consideration (2) $ — $ — $ 1,742 Total $ — $ — $ 1,742 Level 1 Level 2 Level 3 Assets: Short-term investments (1) $ 42,942 $ — $ — Total $ 42,942 $ — $ — Liabilities: Contingent consideration (2) $ — $ — $ 2,100 Total $ — $ — $ 2,100 (1) Short-term investments in the accompanying consolidated balance sheets are six-month U.S. Treasury Bills. The fair values of these assets are based on Level 1 inputs in the fair value hierarchy. (2) Contingent consideration liability represents arrangements to pay the former owners of certain companies we acquired. The remaining undiscounted maximum payment under the arrangements is $5.6 million . We estimated the fair value of the contingent consideration using a Monte Carlo Simulation, which is based on significant inputs, primarily forecasted future results of the acquired businesses not observable in the market, and thus represents a Level 3 measure. During the three and nine months ended September 30, 2017 , we paid $0.5 million as part of these arrangements. During the three and nine months ended September 30, 2016 , we paid $0.3 million and $0.4 million , respectively, as part of these arrangements. The remaining change in the fair value of the contingent consideration from December 31, 2016 to September 30, 2017 is related to changes in foreign currency rates. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | SEGMENT REPORTING We have three reportable segments; Factory Metrology, Construction BIM-CIM, and Other. These segments are based upon the vertical markets that we currently serve. Business activities that do not meet the criteria to be reportable segments are aggregated in the Other category. We develop, manufacture, market, support and sell CAD-based quality assurance products integrated with CAD-based inspection and statistical process control software and three-dimensional documentation systems in each of these reportable segments. These activities represent more than 99% of consolidated sales. Our Chief Operating Decision Maker (CODM), our Chief Executive Officer, evaluates segment performance and allocates resources based upon profitable growth. We use segment profit to evaluate the performance of our reportable segments. Segment profit is calculated as gross profit, net of selling and marketing expenses, for the reporting segment. Our definition of segment profit may not be comparable to similarly-titled measures reported by other companies. Our segment structure presented below represents a change from geographic segments due to the reorganization which took place in the year ended December 31, 2016. The amounts for the three and nine months ended September 30, 2016 have been restated to reflect the change in reporting segments. Each of our segments employs consistent accounting policies. The following tables present information about our reportable segments, including a reconciliation of total segment profit to Income (Loss) from Operations included in the condensed consolidated statements of operations for the three and nine months ended September 30, 2017 and 2016: Factory Metrology Construction BIM-CIM Other Total Three Months Ended September 30, 2017 Total sales $ 59,339 $ 22,751 $ 8,160 $ 90,250 Segment profit $ 20,144 $ 5,407 $ 493 $ 26,044 General and administrative 10,307 Depreciation and amortization 4,368 Research and development 9,019 Income from operations $ 2,350 Factory Metrology Construction BIM-CIM Other Total Three Months Ended September 30, 2016 Total sales $ 58,310 $ 15,925 $ 5,365 $ 79,600 Segment profit $ 16,305 $ 4,704 $ 1,888 $ 22,897 General and administrative 10,747 Depreciation and amortization 3,381 Research and development 7,928 Income from operations $ 841 Factory Metrology Construction BIM-CIM Other Total Nine Months Ended September 30, 2017 Total sales $ 173,531 $ 60,550 $ 20,413 $ 254,494 Segment profit $ 53,497 $ 13,799 $ 363 $ 67,659 General and administrative 32,883 Depreciation and amortization 12,075 Research and development 26,530 Loss from operations $ (3,829 ) Factory Metrology Construction BIM-CIM Other Total Nine Months Ended September 30, 2016 Total sales $ 168,418 $ 47,529 $ 17,939 $ 233,886 Segment profit $ 53,034 $ 12,868 $ 6,982 $ 72,884 General and administrative 31,139 Depreciation and amortization 9,733 Research and development 22,344 Income from operations $ 9,668 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Leases — We lease buildings and equipment in the normal course of business under non-cancellable operating and capital leases that expire in or before 2026 . Total obligations under these leases are approximately $7.1 million for 2017 . Purchase Commitments — We enter into purchase commitments for products and services in the ordinary course of business. These purchases generally cover production requirements for 60 to 120 days as well as materials necessary to service customer units through the product lifecycle and for warranty commitments. As of September 30, 2017 , we had approximately $44.6 million in purchase commitments that are expected to be delivered within the next 12 months. To ensure adequate component availability in preparation for new product introductions, as of September 30, 2017, we also had $0.6 million in long-term commitments for purchases to be delivered after 12 months. Legal Proceedings — We are not involved in any legal proceedings other than routine litigation arising in the normal course of business, none of which we believe will have a material adverse effect on our business, financial condition or results of operations. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Business Combinations | BUSINESS COMBINATIONS In April 2017, we completed the acquisition of substantially all of the assets of Instrument Associates, LLC d/b/a Nutfield Technology (“Nutfield”), a component technology business located in Hudson, New Hampshire, which specializes in the design and manufacture of advanced galvanometer-based optical scanners, scan heads and laser kits, for a total purchase price of approximately $5.5 million . This acquisition supports our long-term strategy to expand our presence in key markets and improve our existing product lines with innovative technology. The results of the acquired business’ operations as of and after the date of acquisition have been included in our condensed consolidated financial statements for the three and nine months ended September 30, 2017 . In December 2016, we acquired MWF-technology, GmbH (“MWF”) for a purchase price, net of cash acquired, of approximately $6.6 million , paid with cash on hand. MWF, an innovator in mobile augmented reality solutions located near Frankfurt, Germany, provides technology that enables large, complex 3D CAD data to be transferred to a tablet device for use in mobile visualization and comparison to real world conditions. This enables real time, actionable manufacturing insight for in-process inspection, assembly, guidance and positioning. In August 2016, we acquired Laser Projection Technologies, Inc. (“LPT”) for a purchase price, net of cash acquired, of approximately $17.2 million , paid with cash on hand. LPT, located in Londonderry, New Hampshire, specializes in laser projection and measurement systems used throughout manufacturing environments around the globe to maximize productivity and efficiency. The acquisition enhances our portfolio of 3D measurement solutions and supports our long-term strategy to expand our presence in key markets. In July 2016, we acquired BuildIT Software & Solutions Ltd. (“BuildIT”) for a purchase price, net of cash acquired, of approximately $3.9 million , paid with cash on hand. BuildIT, a software solutions business located in Montreal, Canada, specializes in process-configurable 3D metrology software solutions with hardware agnostic interfaces. The addition of BuildIT enhances our metrology portfolio, providing customers greater software options to use in a variety of applications to reduce inspection and assembly times and increase productivity. The acquisitions of Nutfield, MWF, LPT, and BuildIT constitute business combinations as defined by FASB ASC Topic 805, Business Combinations . Accordingly, the assets acquired and liabilities assumed were recorded at their fair values on the date of acquisition. Following is a summary of our final allocations of the purchase price to the fair values of the assets acquired and liabilities assumed as of the date of each acquisition: BuildIT LPT MWF Nutfield Accounts receivable $ 237 $ 54 $ 150 $ 160 Inventory — 322 — 539 Other assets 36 160 666 96 Deferred income tax assets — 1,112 — — Intangible assets 1,015 5,474 1,816 2,329 Goodwill (1) 3,393 11,922 5,364 2,488 Accounts payable and accrued liabilities (95 ) (747 ) (700 ) (12 ) Other liabilities (471 ) (1,086 ) (345 ) (104 ) Deferred income tax liabilities (205 ) — (364 ) — Total purchase price, net of cash acquired $ 3,910 $ 17,211 $ 6,587 $ 5,496 (1) The goodwill arising from the acquisitions is not expected to be tax deductible. Following are the details of the purchase price allocated to the intangible assets acquired for the acquisitions noted above: BuildIT LPT MWF Nutfield Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Trade name $ 346 7 $ 64 1 $ 36 1 $ 29 1 Non-competition agreement 31 5 — 0 3 2 144 5 Technology 361 7 4,260 7 951 5 1,970 10 Customer relationship 277 7 1,150 7 826 5 95 10 Favorable in-place lease — 0 — 0 — 0 91 12 Fair value of intangible assets acquired $ 1,015 7 $ 5,474 7 $ 1,816 5 $ 2,329 10 The goodwill for the Nutfield acquisition has been allocated to the Factory Metrology reporting segment. The goodwill for the BuildIT, LPT and MWF acquisitions was allocated in connection with our organizational structure realignment during 2016 using the relative fair value approach. Acquisition and integration costs are not included as components of consideration transferred, but are recorded as expense in the period in which such costs are incurred. To date, we have incurred approximately $0.9 million in acquisition and integration costs for the BuildIT, LPT, MWF and Nutfield acquisitions. Pro forma financial results for BuildIT, LPT, MWF and Nutfield have not been presented because the effects of these transactions, individually and in the aggregate, were not material to our consolidated results of operations. |
Principles of Consolidation (Po
Principles of Consolidation (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidation Policy | Our condensed consolidated financial statements include the accounts of FARO Technologies, Inc. and its subsidiaries, all of which are wholly owned. All intercompany transactions and balances have been eliminated. |
Foreign Currency Translations Policy | The financial statements of our foreign subsidiaries are translated into U.S. dollars using exchange rates in effect at period-end for assets and liabilities and average exchange rates during each reporting period for results of operations. Adjustments resulting from financial statement translations are reflected as a separate component of accumulated other comprehensive loss. Foreign currency transaction gains and losses are included in income. |
Basis of Accounting Policy | The accompanying unaudited condensed consolidated financial statements and notes thereto have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. These condensed consolidated financial statements include all normal recurring accruals and adjustments considered necessary by management for a fair presentation in conformity with U.S. GAAP. |
Use of Estimates Policy | Preparing financial statements 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. |
Reclassification Policy | Certain prior period amounts have been reclassified in the accompanying condensed consolidated financial statements to conform to the current period presentation. Certain prior period stock compensation expenses were reclassified between cost of product sales, cost of service sales, selling and marketing, general and administrative, and research and development expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended September 30, 2016 to reflect the appropriate departmental costs. In addition, deferred income tax assets, net were reclassified from current to non-current in our condensed consolidated balance sheet as of December 31, 2016 as a result of adopting Accounting Standards Update ("ASU") No. 2015-17, Income Taxes (Topic 740: Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"). |
New Accounting Pronouncements Policy | In January 2017, the FASB issued ASU No. 2017-04, Intangible - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which is intended to simplify the subsequent measurement of goodwill by eliminating Step 2 from the goodwill impairment test. Under the current guidance, performance of Step 2 requires us to calculate the implied fair value of goodwill by following procedures that would be required in determining the fair value of assets acquired and liabilities assumed in a business combination. Under the new guidance, we will perform our goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge will be recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value up to the amount of the goodwill allocated to the reporting unit. The new guidance also eliminates the requirements for any reporting unit with a zero or negative carrying amount to perform Step 2 of the goodwill impairment test if it fails the qualitative assessment. As a result, all reporting units will be subject to the same impairment assessment. We will still have the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. ASU 2017-04 becomes effective for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted for annual or any interim goodwill impairment tests after January 1, 2017. The amendments in this ASU will be applied on a prospective basis. Disclosure of the nature and reason for the change in accounting principle is required upon transition. This disclosure is required in the first annual period and in the interim period within the first annual period when we initially adopt the amendments in this ASU. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”) in order to clarify the definition of a business and provide additional guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Currently, ASC Topic 805 recognizes three elements of a business: inputs, processes, and outputs. While an integrated set of assets and activities (collectively referred to as a “set”) that is a business usually has outputs, outputs are not required to be present. Additionally, all the inputs and processes that a seller uses in operating a set are not required if market participants can acquire the set and continue to produce outputs. ASU 2017-01 provides a screen to determine when a set is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. If the screen is not met, the new guidance (1) requires that to be considered a business, a set must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output and (2) removes the evaluation of whether a market participant could replace missing elements. The new guidance provides a framework to assist entities in evaluating whether both an input and a substantive process are present. This framework includes two sets of criteria to consider that depend on whether a set has outputs. Although outputs are not required for a set to be a business, outputs generally are a key element of a business. ASU 2017-01 provides more stringent criteria for sets without outputs and more narrowly defines the term output. ASU 2017-01 becomes effective for annual periods beginning after December 15, 2017, including interim periods within those periods, and will be applied prospectively commencing on the effective date. No disclosures are required at transition. Early application is permitted under certain circumstances. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory (“ASU 2016-16”), which removes the prohibition in ASC Topic 740, Income Taxes , against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. This ASU requires the tax effects of intra-entity transactions, other than sales of inventory, to be recognized when the transfer occurs, instead of deferred until the transferred asset is sold to a third party or otherwise recovered through use of the asset. The new guidance must be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption and is effective for annual periods beginning after December 15, 2017, and interim periods therein, with early adoption permitted. Currently, we do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. We will continue to monitor our business for changes that could be impacted due to the adoption of this guidance. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”), which clarifies how companies present and classify certain cash receipts and cash payments in the statement of cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017, and interim periods therein. Early adoption is permitted. We do not expect that the adoption of this guidance will have a material impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases ( Topic 842) ( “ASU 2016-02”), which is intended to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. ASU 2016-02 must be applied on a modified retrospective basis and is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. We are currently evaluating the impact of adopting this standard on our consolidated financial statements and related disclosures. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers: (Topic 606) (“ASU 2014-09”), amending its accounting guidance related to revenue recognition. Under this ASU and subsequently issued amendments, revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additional disclosures are required to provide the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. The ASU and subsequently issued amendments to it are effective for us on January 1, 2018 and permit the use of either the full retrospective or modified retrospective method. We are currently evaluating the effect that this guidance will have on our consolidated financial statements by analyzing both transactional and analytical data for each of our revenue streams. The following is a status of our evaluation of impacts by significant revenue stream: • Measurement equipment and related software: Under current accounting guidance, sales of measurement, imaging and realization equipment and related software sales are generally recognized upon shipment, as we consider the earnings process complete as of the shipping date. The related software sold with our measurement, imaging and realization equipment functions together with such equipment to deliver the tangible product’s essential functionality. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to our measurement, imaging and realization equipment and related software. • Extended warranties: Under current accounting guidance, extended warranty sales are recognized on a straight-line basis over the term of the warranty. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to extended warranties. • Software: Under current accounting guidance, software only sales are recognized when no further significant production, modification or customization of the software is required and when the following criteria are met: persuasive evidence of a sales agreement exists, delivery has occurred, and the sales price is fixed or determinable and deemed collectible. These software arrangements generally include short-term maintenance that is considered post-contract support. Maintenance renewals, when sold, are recognized on a straight-line basis over the term of the maintenance agreement. Upon adopting the new guidance, we do not expect material changes to our accounting for revenue related to software only sales and maintenance renewals. Currently, we recognize sales commission expense as incurred. Under the new guidance, we expect to capitalize the commission expense for those sales arrangements that extend beyond one year and amortize such costs ratably over the term of the contract. As a result, we expect to have an increase in deferred costs on our consolidated balance sheet upon the adoption of the new guidance; however, we are still evaluating the expected impact of this change on our consolidated balance sheet. We do not expect that this will result in a material change to our results of operations or cash flows. We plan to adopt this guidance utilizing the modified retrospective method and plan to apply the modified retrospective method only to contracts that are not completed as of the date of initial adoption, an option that is available under ASC Topic 606. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), simplifying several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. ASU 2016-09 became effective for annual periods beginning after December 15, 2016, and interim periods therein (our fiscal year 2017). We adopted ASU 2016-09 effective January 1, 2017. Under the new guidance, excess tax benefits that were not previously recognized because the related tax deduction had not reduced current taxes payable are to be recorded on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period in which the new guidance is adopted. Historically, we recognized all excess tax benefits when an option was exercised or a share vested since we did not have a U.S. net operating loss carryforward. Therefore, no adjustment to retained earnings for prior excess tax benefits was required upon adoption. Under the new guidance, all tax-related cash flows resulting from share-based payments are reported as operating activities in the statement of cash flows. This approach incorporates the net of the inflow and outflow from all tax-related cash flows resulting from share-based payments in the deferred income tax expense (benefit) line item and presents it along with other income tax cash flows as operating activities in the statement of cash flows. Effective January 1, 2017, we adopted this portion of the guidance on a prospective basis and therefore did not restate the prior period's condensed consolidated statement of cash flows. We also elected to account for forfeitures related to the service condition-based awards as they occur effective January 1, 2017, which is a change from previous guidance that required an estimate of forfeitures. However, we continue to assess performance condition-based awards quarterly as required. In adopting the new policy using a modified retrospective approach, we assessed the cumulative effect adjustment and recorded to retained earnings the difference between the amount of compensation cost previously recorded and the amount that would have been recorded without assuming forfeitures. The cumulative effect adjustment recorded to retained earnings, net of income tax benefit, was not material. In November 2015, the FASB issued ASU 2015-17, which requires that deferred tax liabilities and assets be classified as noncurrent in a classified balance sheet. ASU 2015-17 became effective for us on January 1, 2017. We adopted this guidance on a retrospective basis, which resulted in the reclassification of current deferred tax assets totaling approximately $7.6 million as of December 31, 2016 from current to non-current in these condensed consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory (“ASU 2015-11”), which changes the measurement principle for inventory from the lower of cost or market to the lower of cost or net realizable value. ASU 2015-11 defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The new guidance must be applied on a prospective basis and became effective for fiscal years beginning after December 15, 2016 (i.e., our fiscal year 2017), and interim periods within those years, with early adoption permitted. We adopted ASU 2015-11 effective January 1, 2017. The adoption of this guidance did not have a material impact on our condensed consolidated financial statements. |
Cash and Cash Equivalents Policy | We consider cash on hand and all short-term, highly liquid investments that have original maturities of three months or less at the time of purchase to be cash and cash equivalents. |
Inventory Policy | Inventories are stated at the lower of cost or net realizable value using the first-in first-out (FIFO) method. We have three principal categories of inventory: 1) manufactured product to be sold; 2) sales demonstration inventory - completed product used to support our sales force and demonstrations; and 3) service inventory - completed product and parts used to support our service department. Shipping and handling costs are classified as a component of cost of sales in our condensed consolidated statements of operations. Sales demonstration inventory is held by our sales representatives for up to three years , at which time it would be refurbished and transferred to finished goods as used equipment, stated at the lower of cost or net realizable value. Management expects these refurbished units to remain in finished goods inventory and to be sold within 12 months at prices that may produce reduced gross margins. Service inventory is used to provide a temporary replacement product to a customer covered by a premium warranty when the customer’s unit requires service or repair and as training equipment. Service inventory is available for sale; however, management does not expect service inventory to be sold within 12 months and, as such, classifies this inventory as a long-term asset. Service inventory that we utilize for training or repairs and which we deem as no longer available for sale is transferred to fixed assets at the lower of cost or net realizable value and depreciated over the remaining life, typically three years. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Stock Option Activity and Weighted Average Exercise Prices | A summary of stock option activity and weighted-average exercise prices during the nine months ended September 30, 2017 follows: Options Weighted- Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Outstanding at January 1, 2017 1,090,160 $ 48.02 Granted 267,039 34.79 Forfeited or expired (72,015 ) 44.39 Exercised (14,520 ) 26.68 Unearned performance-based options (19,362 ) 59.97 Outstanding at September 30, 2017 1,251,302 $ 45.47 4.2 $ 2,235 Options exercisable at September 30, 2017 963,891 $ 42.82 3.0 $ 612 |
Schedule of Restricted Stock and Restricted Stock Units Activity and Weighted-Average Grant Date Fair Value | The following table summarizes the restricted stock and restricted stock unit activity and weighted average grant-date fair values for the nine months ended September 30, 2017 : Shares Weighted-Average Grant Date Fair Value Non-vested at January 1, 2017 150,682 $ 33.39 Granted 152,207 35.42 Forfeited (20,844 ) 33.84 Vested (21,101 ) 33.65 Unearned performance-based awards (604 ) 52.83 Non-vested at September 30, 2017 260,340 $ 34.60 |
Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Valuation Assumptions | For stock options granted during the nine months ended September 30, 2017 and September 30, 2016 valued using the Black-Scholes option valuation model, we used the following assumptions: Nine Months Ended September 30, September 30, Risk-free interest rate 1.88% - 2.02% 1.06% - 1.21% Expected dividend yield — % — % Expected term of option 5 years 4 years Expected volatility 45.2 % 46.7% - 47.0% Weighted-average expected volatility 45.2 % 46.7 % |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consist of the following: As of As of Accounts receivable $ 62,489 $ 63,193 Allowance for doubtful accounts (2,040 ) (1,829 ) Total $ 60,449 $ 61,364 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consist of the following: As of As of Raw materials $ 39,285 $ 36,760 Finished goods 19,759 15,126 Inventories, net $ 59,044 $ 51,886 Service and sales demonstration inventory, net $ 35,250 $ 29,136 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Number of Common Shares Used in Calculation of Basic and Diluted Earnings Per Share (EPS) | A reconciliation of the number of common shares used in the calculation of basic and diluted earnings per share (“EPS”) is presented below: Three Months Ended September 30, 2017 September 30, 2016 Shares Per-Share Amount Shares Per-Share Amount Basic EPS 16,708,446 $ 0.10 16,674,176 $ 0.07 Effect of dilutive securities 88,072 — 27,441 — Diluted EPS 16,796,518 $ 0.10 16,701,617 $ 0.07 Nine months ended September 30, 2017 September 30, 2016 Shares Per-Share Amount Shares Per-Share Amount Basic EPS 16,697,729 $ (0.21 ) 16,647,662 $ 0.45 Effect of dilutive securities — — 21,888 — Diluted EPS 16,697,729 $ (0.21 ) 16,669,550 $ 0.45 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following: As of As of Accrued compensation and benefits $ 12,347 $ 13,649 Accrued warranties 2,584 2,594 Professional and legal fees 1,442 1,775 Taxes other than income 2,697 4,026 Other accrued liabilities 3,437 2,528 $ 22,507 $ 24,572 |
Schedule of Activity Related to Accrued Warranties | Activity related to accrued warranties was as follows: Nine Months Ended September 30, 2017 September 30, 2016 Balance, beginning of period $ 2,594 $ 2,309 Provision for warranty expense 2,606 2,292 Fulfillment of warranty obligations (2,616 ) (1,925 ) Balance, end of period $ 2,584 $ 2,676 |
Fair Value of Financial Instr30
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are categorized in the tables below based upon the lowest level of significant input to the valuations: As of September 30, 2017 Level 1 Level 2 Level 3 Assets: Short-term investments (1) $ 10,970 $ — $ — Total $ 10,970 $ — $ — Liabilities: Contingent consideration (2) $ — $ — $ 1,742 Total $ — $ — $ 1,742 Level 1 Level 2 Level 3 Assets: Short-term investments (1) $ 42,942 $ — $ — Total $ 42,942 $ — $ — Liabilities: Contingent consideration (2) $ — $ — $ 2,100 Total $ — $ — $ 2,100 (1) Short-term investments in the accompanying consolidated balance sheets are six-month U.S. Treasury Bills. The fair values of these assets are based on Level 1 inputs in the fair value hierarchy. (2) Contingent consideration liability represents arrangements to pay the former owners of certain companies we acquired. The remaining undiscounted maximum payment under the arrangements is $5.6 million . We estimated the fair value of the contingent consideration using a Monte Carlo Simulation, which is based on significant inputs, primarily forecasted future results of the acquired businesses not observable in the market, and thus represents a Level 3 measure. During the three and nine months ended September 30, 2017 , we paid $0.5 million as part of these arrangements. During the three and nine months ended September 30, 2016 , we paid $0.3 million and $0.4 million , respectively, as part of these arrangements. The remaining change in the fair value of the contingent consideration from December 31, 2016 to September 30, 2017 is related to changes in foreign currency rates. |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following tables present information about our reportable segments, including a reconciliation of total segment profit to Income (Loss) from Operations included in the condensed consolidated statements of operations for the three and nine months ended September 30, 2017 and 2016: Factory Metrology Construction BIM-CIM Other Total Three Months Ended September 30, 2017 Total sales $ 59,339 $ 22,751 $ 8,160 $ 90,250 Segment profit $ 20,144 $ 5,407 $ 493 $ 26,044 General and administrative 10,307 Depreciation and amortization 4,368 Research and development 9,019 Income from operations $ 2,350 Factory Metrology Construction BIM-CIM Other Total Three Months Ended September 30, 2016 Total sales $ 58,310 $ 15,925 $ 5,365 $ 79,600 Segment profit $ 16,305 $ 4,704 $ 1,888 $ 22,897 General and administrative 10,747 Depreciation and amortization 3,381 Research and development 7,928 Income from operations $ 841 Factory Metrology Construction BIM-CIM Other Total Nine Months Ended September 30, 2017 Total sales $ 173,531 $ 60,550 $ 20,413 $ 254,494 Segment profit $ 53,497 $ 13,799 $ 363 $ 67,659 General and administrative 32,883 Depreciation and amortization 12,075 Research and development 26,530 Loss from operations $ (3,829 ) Factory Metrology Construction BIM-CIM Other Total Nine Months Ended September 30, 2016 Total sales $ 168,418 $ 47,529 $ 17,939 $ 233,886 Segment profit $ 53,034 $ 12,868 $ 6,982 $ 72,884 General and administrative 31,139 Depreciation and amortization 9,733 Research and development 22,344 Income from operations $ 9,668 |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Schedule of Fair Values of Assets Acquired and Liabilities Assumed for Acquisitions | Following is a summary of our final allocations of the purchase price to the fair values of the assets acquired and liabilities assumed as of the date of each acquisition: BuildIT LPT MWF Nutfield Accounts receivable $ 237 $ 54 $ 150 $ 160 Inventory — 322 — 539 Other assets 36 160 666 96 Deferred income tax assets — 1,112 — — Intangible assets 1,015 5,474 1,816 2,329 Goodwill (1) 3,393 11,922 5,364 2,488 Accounts payable and accrued liabilities (95 ) (747 ) (700 ) (12 ) Other liabilities (471 ) (1,086 ) (345 ) (104 ) Deferred income tax liabilities (205 ) — (364 ) — Total purchase price, net of cash acquired $ 3,910 $ 17,211 $ 6,587 $ 5,496 (1) The goodwill arising from the acquisitions is not expected to be tax deductible. |
Summary of the Purchase Price Preliminarily Allocated to the Intangible Assets Acquired for the Acquisitions | Following are the details of the purchase price allocated to the intangible assets acquired for the acquisitions noted above: BuildIT LPT MWF Nutfield Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Amount Weighted Average Life (Years) Trade name $ 346 7 $ 64 1 $ 36 1 $ 29 1 Non-competition agreement 31 5 — 0 3 2 144 5 Technology 361 7 4,260 7 951 5 1,970 10 Customer relationship 277 7 1,150 7 826 5 95 10 Favorable in-place lease — 0 — 0 — 0 91 12 Fair value of intangible assets acquired $ 1,015 7 $ 5,474 7 $ 1,816 5 $ 2,329 10 |
Description of Business (Detail
Description of Business (Details) | 9 Months Ended |
Sep. 30, 2017segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 3 |
Impact of Recently Issued Acc34
Impact of Recently Issued Accounting Pronouncements (Details) - Accounting Standards Update 2015-17 $ in Millions | Dec. 31, 2016USD ($) |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |
Deferred tax assets classified as non-current | $ 7.6 |
Deferred tax assets classified as current, prior period | $ 7.6 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 28, 2017shares | Sep. 30, 2017USD ($)plan | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)plan$ / sharesshares | Sep. 30, 2016USD ($)$ / shares | May 31, 2014shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of compensation plans | plan | 3 | 3 | ||||
Fair value of stock options vested | $ | $ 100,000 | $ 100,000 | $ 3,000,000 | $ 3,500,000 | ||
Allocated share-based compensation expense | $ | 1,600,000 | 1,400,000 | 4,800,000 | 4,100,000 | ||
Unrecognized stock-based compensation expense | $ | 11,000,000 | $ 11,000,000 | ||||
Weighted average, expected recognition period | 2 years | |||||
Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period (in years) | 3 years | |||||
Number of restricted stock units vested (in shares) | 21,101 | |||||
Number of restricted stock units unvested (in shares) | 604 | |||||
Performance Shares | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period (in years) | 3 years | |||||
Performance Based Employee Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of stock options vested (in shares) | 9,616 | |||||
Number of stock options unvested (in shares) | 19,362 | |||||
Performance Based Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of restricted stock units vested (in shares) | 300 | |||||
Number of restricted stock units unvested (in shares) | 604 | |||||
Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of stock options unvested (in shares) | 19,362 | |||||
Total intrinsic value of stock options exercised (less than) | $ | $ 100,000 | $ 100,000 | $ 100,000 | $ 1,700,000 | ||
Employee Stock Option | Black-Scholes Option Valuation Model | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock option weighted average grant date fair value (in dollars per share) | $ / shares | $ 14.51 | $ 12.42 | ||||
March 2017 | Year One | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2017 | Year One | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2017 | Year Two | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2017 | Year Two | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2017 | Year Three | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2017 | Year Three | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year One | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year One | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year Two | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year Two | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year Three | Restricted Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
March 2016 | Year Three | Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year One | Performance Based Employee Stock Options | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year One | Performance Based Restricted Stock Units | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year Two | Performance Based Employee Stock Options | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year Two | Performance Based Restricted Stock Units | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year Three | Performance Based Employee Stock Options | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
2015 | Year Three | Performance Based Restricted Stock Units | Executive Officer | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting installment (as a percent) | 33.33% | |||||
Two Thousand Fourteen Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Awards authorized to grant (in shares) | 1,974,543 | |||||
Director S Plan Per Director | Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Term for value of shares to be granted upon election | $ | $ 100,000 | |||||
Vesting period (in years) | 3 years | |||||
Director S Plan Per Director | Restricted Stock | Lead Director | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Term for value of shares to be granted upon election | $ | $ 40,000 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions Used to Estimate The Fair Value of Time-Based Stock Options (Details) - Employee Stock Option | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Risk-free interest rate, minimum | 1.88% | 1.06% |
Risk-free interest rate, maximum | 2.02% | 1.21% |
Expected dividend yield (as a percent) | 0.00% | 0.00% |
Expected term of option (in years) | 5 years | 4 years |
Expected volatility (as a percent) | 45.20% | |
Expected volatility, minimum (as a percent) | 46.70% | |
Expected volatility, maximum (as a percent) | 47.00% | |
Weighted-average expected volatility (as a percent) | 45.20% | 46.70% |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Option Activity and Weighted Average Exercise Prices (Details) - Employee Stock Option $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2017USD ($)$ / sharesshares | |
Options | |
Outstanding at January 1, 2017 (in shares) | shares | 1,090,160 |
Granted (in shares) | shares | 267,039 |
Forfeited or expired (in shares) | shares | (72,015) |
Exercised (in shares) | shares | (14,520) |
Unearned performance-based options (in shares) | shares | (19,362) |
Outstanding at September 30, 2017 (in shares) | shares | 1,251,302 |
Options exercisable at September 30, 2017 (in shares) | shares | 963,891 |
Weighted- Average Exercise Price | |
Outstanding at January 1, 2017 (in dollars per share) | $ / shares | $ 48.02 |
Granted (in dollars per share) | $ / shares | 34.79 |
Forfeited or expired (in dollars per share) | $ / shares | 44.39 |
Exercised (in dollars per share) | $ / shares | 26.68 |
Unearned performance-based options (in dollars per share) | $ / shares | 59.97 |
Outstanding at September 30, 2017 (in dollars per share) | $ / shares | 45.47 |
Options exercisable at September 30, 2017 (in dollars per share) | $ / shares | $ 42.82 |
Weighted-Average Remaining Contractual Term (Years) | |
Weighted-average remaining contractual term, outstanding at September 30, 2017 | 4 years 2 months 12 days |
Weighted-average remaining contractual term, options exercisable at September 30, 2017 | 3 years |
Aggregate Intrinsic Value as of September 30, 2017 | |
Aggregate intrinsic value outstanding at September 30, 2017 | $ | $ 2,235 |
Aggregate intrinsic value of options exercisable at September 30, 2017 | $ | $ 612 |
Stock-Based Compensation - Sc38
Stock-Based Compensation - Schedule of Restricted Stock Unit Activity and Weighted Average Grant Date Fair Value (Details) - Restricted Stock Units | 9 Months Ended |
Sep. 30, 2017$ / sharesshares | |
Shares | |
Non-vested at January 1, 2017 (in shares) | shares | 150,682 |
Granted (in shares) | shares | 152,207 |
Forfeited (in shares) | shares | (20,844) |
Vested (in shares) | shares | (21,101) |
Unearned performance-based awards (in shares) | shares | (604) |
Non-vested at September 30, 2017 (in shares) | shares | 260,340 |
Weighted-Average Grant Date Fair Value | |
Non-vested at January 1, 2017 (in dollars per share) | $ / shares | $ 33.39 |
Granted (in dollars per share) | $ / shares | 35.42 |
Forfeited (in dollars per share) | $ / shares | 33.84 |
Vested (in dollars per share) | $ / shares | 33.65 |
Unearned performance-based awards (in dollars per share) | $ / shares | 52.83 |
Non-vested at September 30, 2017 (in dollars per share) | $ / shares | $ 34.60 |
Short Term Investments - Additi
Short Term Investments - Additional Information (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Securities Purchased Under Agreements to Resell and Other Short Term Investment Securities [Line Items] | ||
Short-term investments | $ 10,970 | $ 42,942 |
Interest rate on U.S. Treasury Bills (less than) | 1.00% | 1.00% |
US Treasury Bill Securities | ||
Securities Purchased Under Agreements to Resell and Other Short Term Investment Securities [Line Items] | ||
Short-term investments | $ 11,000 | $ 42,900 |
Accounts Receivable - Additiona
Accounts Receivable - Additional Information (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Accounts receivable | $ 62,489 | $ 63,193 |
Allowance for doubtful accounts | (2,040) | (1,829) |
Total | $ 60,449 | $ 61,364 |
Inventories - Additional Inform
Inventories - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017principal_inventory_category | |
Property, Plant and Equipment [Line Items] | |
Number of principal categories of inventory | 3 |
Demonstration inventory shelf life (in years) | 3 years |
Refurbished demonstration inventory selling period (in months) | 12 months |
Service Inventory | |
Property, Plant and Equipment [Line Items] | |
Inventory, remaining useful life (in years) | 3 years |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 39,285 | $ 36,760 |
Finished goods | 19,759 | 15,126 |
Inventories, net | 59,044 | 51,886 |
Service and sales demonstration inventory, net | $ 35,250 | $ 29,136 |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation of Number of Common Shares Used in Calculation of Basic and Diluted Earnings Per Share (EPS) (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities (in shares) | 1,143,523 | 1,002,856 | 1,145,632 | 1,042,366 |
Basic EPS (in shares) | 16,708,446 | 16,674,176 | 16,697,729 | 16,647,662 |
Effect of dilutive securities (in shares) | 88,072 | 27,441 | 0 | 21,888 |
Diluted EPS (in shares) | 16,796,518 | 16,701,617 | 16,697,729 | 16,669,550 |
Basic EPS (in dollars per share) | $ 0.10 | $ 0.07 | $ (0.21) | $ 0.45 |
Effect of dilutive securities (in dollars per share) | 0 | 0 | 0 | 0 |
Diluted EPS (in dollars per share) | $ 0.10 | $ 0.07 | $ (0.21) | $ 0.45 |
Accrued Liabilities - Summary (
Accrued Liabilities - Summary (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||||
Accrued compensation and benefits | $ 12,347 | $ 13,649 | ||
Accrued warranties | 2,584 | 2,594 | $ 2,676 | $ 2,309 |
Professional and legal fees | 1,442 | 1,775 | ||
Taxes other than income | 2,697 | 4,026 | ||
Other accrued liabilities | 3,437 | 2,528 | ||
Accrued liabilities | $ 22,507 | $ 24,572 |
Accrued Liabilities - Activity
Accrued Liabilities - Activity Related to Accrued Warranties (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||
Balance, beginning of period | $ 2,594 | $ 2,309 |
Provision for warranty expense | 2,606 | 2,292 |
Fulfillment of warranty obligations | (2,616) | (1,925) |
Balance, end of period | $ 2,584 | $ 2,676 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 947 | $ (61) | $ (442) | $ 1,401 |
Income tax expense increase (decrease) | $ (1,800) | |||
Effective tax rate | 36.80% | (5.90%) | 11.30% | 15.60% |
Effective tax rate, increase for period (as a percent) | 4.30% |
Fair Value of Financial Instr47
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Level 1 | ||
Assets: | ||
Short-term investments | $ 10,970 | $ 42,942 |
Total | 10,970 | 42,942 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Total | 0 | 0 |
Level 2 | ||
Assets: | ||
Short-term investments | 0 | 0 |
Total | 0 | 0 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Total | 0 | 0 |
Level 3 | ||
Assets: | ||
Short-term investments | 0 | 0 |
Total | 0 | 0 |
Liabilities: | ||
Contingent consideration | 1,742 | 2,100 |
Total | $ 1,742 | $ 2,100 |
Fair Value of Financial Instr48
Fair Value of Financial Instruments - Assets and Liabilities Measured at Fair Value on a Recurring Basis - Footnotes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Payment for contingent consideration arrangements | $ 500 | $ 300 | $ 521 | $ 434 |
Monte Carlo Simulation Valuation Model | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Undiscounted maximum payment under the contingent consideration arrangements | $ 5,600 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 3 |
Minimum | |
Segment Reporting Information [Line Items] | |
Product sales to consolidated sales (more than) (as a percent) | 99.00% |
Segment Reporting - Summary of
Segment Reporting - Summary of Reportable Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment Reporting Information [Line Items] | ||||
Total sales | $ 90,250 | $ 79,600 | $ 254,494 | $ 233,886 |
Segment profit | 52,034 | 42,678 | 142,543 | 129,283 |
General and administrative | 10,307 | 10,747 | 32,883 | 31,139 |
Depreciation and amortization | 4,368 | 3,381 | 12,075 | 9,733 |
Research and development | 9,019 | 7,928 | 26,530 | 22,344 |
Income (loss) from operations | 2,350 | 841 | (3,829) | 9,668 |
Factory Metrology | ||||
Segment Reporting Information [Line Items] | ||||
Total sales | 59,339 | 58,310 | 173,531 | 168,418 |
Construction BIM-CIM | ||||
Segment Reporting Information [Line Items] | ||||
Total sales | 22,751 | 15,925 | 60,550 | 47,529 |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Total sales | 8,160 | 5,365 | 20,413 | 17,939 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | 26,044 | 22,897 | 67,659 | 72,884 |
Operating Segments | Factory Metrology | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | 20,144 | 16,305 | 53,497 | 53,034 |
Operating Segments | Construction BIM-CIM | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | 5,407 | 4,704 | 13,799 | 12,868 |
Operating Segments | Other | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | $ 493 | $ 1,888 | $ 363 | $ 6,982 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Commitments and Contingencies [Line Items] | |
Purchase commitment, due in next twelve months | $ 44.6 |
Minimum | |
Commitments and Contingencies [Line Items] | |
Length of purchase commitments, (in days) | 60 days |
Maximum | |
Commitments and Contingencies [Line Items] | |
Length of purchase commitments, (in days) | 120 days |
Buildings And Equipment | |
Commitments and Contingencies [Line Items] | |
Lease future expiration date, year | 2,026 |
Total remaining lease obligations | $ 7.1 |
Business Combinations - Additio
Business Combinations - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | ||||
Apr. 30, 2017 | Dec. 31, 2016 | Aug. 31, 2016 | Jul. 31, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Business Acquisition [Line Items] | ||||||
Purchase price, net of cash acquired | $ 5,496 | $ 20,911 | ||||
Acquisition and integration costs | $ 900 | |||||
Nutfield | ||||||
Business Acquisition [Line Items] | ||||||
Purchase price, net of cash acquired | $ 5,500 | |||||
MWF | ||||||
Business Acquisition [Line Items] | ||||||
Purchase price, net of cash acquired | $ 6,600 | |||||
LPT | ||||||
Business Acquisition [Line Items] | ||||||
Purchase price, net of cash acquired | $ 17,200 | |||||
BuildIT | ||||||
Business Acquisition [Line Items] | ||||||
Purchase price, net of cash acquired | $ 3,900 |
Business Combinations - Purchas
Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Apr. 30, 2017 | Dec. 31, 2016 | Aug. 31, 2016 | Jul. 31, 2016 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 52,567 | $ 46,744 | |||
BuildIT | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 237 | ||||
Inventory | 0 | ||||
Other assets | 36 | ||||
Deferred income tax assets | 0 | ||||
Intangible assets | 1,015 | ||||
Goodwill | 3,393 | ||||
Accounts payable and accrued liabilities | (95) | ||||
Other liabilities | (471) | ||||
Deferred income tax liabilities | (205) | ||||
Total purchase price, net of cash acquired | $ 3,910 | ||||
LPT | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 54 | ||||
Inventory | 322 | ||||
Other assets | 160 | ||||
Deferred income tax assets | 1,112 | ||||
Intangible assets | 5,474 | ||||
Goodwill | 11,922 | ||||
Accounts payable and accrued liabilities | (747) | ||||
Other liabilities | (1,086) | ||||
Deferred income tax liabilities | 0 | ||||
Total purchase price, net of cash acquired | $ 17,211 | ||||
MWF | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | 150 | ||||
Inventory | 0 | ||||
Other assets | 666 | ||||
Deferred income tax assets | 0 | ||||
Intangible assets | 1,816 | ||||
Goodwill | 5,364 | ||||
Accounts payable and accrued liabilities | (700) | ||||
Other liabilities | (345) | ||||
Deferred income tax liabilities | (364) | ||||
Total purchase price, net of cash acquired | $ 6,587 | ||||
Nutfield | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 160 | ||||
Inventory | 539 | ||||
Other assets | 96 | ||||
Deferred income tax assets | 0 | ||||
Intangible assets | 2,329 | ||||
Goodwill | 2,488 | ||||
Accounts payable and accrued liabilities | (12) | ||||
Other liabilities | (104) | ||||
Deferred income tax liabilities | 0 | ||||
Total purchase price, net of cash acquired | $ 5,496 |
Business Combinations - Summary
Business Combinations - Summary of the Purchase Price Allocated to the Intangible Assets (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Apr. 30, 2017 | Dec. 31, 2016 | Aug. 31, 2016 | Jul. 31, 2016 | |
BuildIT | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 1,015 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
BuildIT | Trade name | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 346 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
BuildIT | Non-competition agreement | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 31 | |||
Intangible assets acquired, weighted average life (in years) | 5 years | |||
BuildIT | Technology | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 361 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
BuildIT | Customer relationship | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 277 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
BuildIT | Favorable in-place lease | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 0 | |||
Intangible assets acquired, weighted average life (in years) | 0 years | |||
LPT | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 5,474 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
LPT | Trade name | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 64 | |||
Intangible assets acquired, weighted average life (in years) | 1 year | |||
LPT | Non-competition agreement | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 0 | |||
Intangible assets acquired, weighted average life (in years) | 0 years | |||
LPT | Technology | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 4,260 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
LPT | Customer relationship | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 1,150 | |||
Intangible assets acquired, weighted average life (in years) | 7 years | |||
LPT | Favorable in-place lease | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 0 | |||
Intangible assets acquired, weighted average life (in years) | 0 years | |||
MWF | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 1,816 | |||
Intangible assets acquired, weighted average life (in years) | 5 years | |||
MWF | Trade name | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 36 | |||
Intangible assets acquired, weighted average life (in years) | 1 year | |||
MWF | Non-competition agreement | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 3 | |||
Intangible assets acquired, weighted average life (in years) | 2 years | |||
MWF | Technology | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 951 | |||
Intangible assets acquired, weighted average life (in years) | 5 years | |||
MWF | Customer relationship | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 826 | |||
Intangible assets acquired, weighted average life (in years) | 5 years | |||
MWF | Favorable in-place lease | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 0 | |||
Intangible assets acquired, weighted average life (in years) | 0 years | |||
Nutfield | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 2,329 | |||
Intangible assets acquired, weighted average life (in years) | 10 years | |||
Nutfield | Trade name | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 29 | |||
Intangible assets acquired, weighted average life (in years) | 1 year | |||
Nutfield | Non-competition agreement | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 144 | |||
Intangible assets acquired, weighted average life (in years) | 5 years | |||
Nutfield | Technology | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 1,970 | |||
Intangible assets acquired, weighted average life (in years) | 10 years | |||
Nutfield | Customer relationship | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 95 | |||
Intangible assets acquired, weighted average life (in years) | 10 years | |||
Nutfield | Favorable in-place lease | ||||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||
Intangible assets acquired | $ 91 | |||
Intangible assets acquired, weighted average life (in years) | 12 years |