Cover
Cover - shares | 9 Months Ended | |
Mar. 31, 2024 | May 02, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 000-26926 | |
Entity Registrant Name | ScanSource, Inc. | |
Entity Incorporation, State or Country Code | SC | |
Entity Tax Identification Number | 57-0965380 | |
Entity Address, Address Line One | 6 Logue Court | |
Entity Address, City or Town | Greenville | |
Entity Address, State or Province | SC | |
Entity Address, Postal Zip Code | 29615 | |
City Area Code | 864 | |
Local Phone Number | 288-2432 | |
Title of 12(b) Security | Common stock, no par value | |
Trading Symbol | SCSC | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 24,709,204 | |
Entity Central Index Key | 0000918965 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 159,050 | $ 36,178 |
Accounts receivable, less allowance of $19,566 at March 31, 2024 and $15,480 at June 30, 2023 | 589,847 | 753,236 |
Inventories | 529,163 | 757,574 |
Prepaid expenses and other current assets | 138,100 | 110,087 |
Total current assets | 1,416,160 | 1,657,075 |
Property and equipment, net | 35,594 | 37,379 |
Goodwill | 207,616 | 216,706 |
Identifiable intangible assets, net | 41,510 | 68,495 |
Deferred income taxes | 19,231 | 17,764 |
Other non-current assets | 62,877 | 70,750 |
Total assets | 1,782,988 | 2,068,169 |
Current liabilities: | ||
Accounts payable | 555,733 | 691,119 |
Accrued expenses and other current liabilities | 74,664 | 78,892 |
Income taxes payable | 4,792 | 9,875 |
Current portion of long-term debt | 7,857 | 6,915 |
Total current liabilities | 643,046 | 786,801 |
Deferred income taxes | 0 | 3,816 |
Long-term debt, net of current portion | 138,024 | 144,006 |
Borrowings under revolving credit facility | 0 | 178,980 |
Other long-term liabilities | 57,867 | 49,268 |
Total liabilities | 838,937 | 1,162,871 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Preferred stock, no par value; 3,000,000 shares authorized, none issued | 0 | 0 |
Common stock, no par value; 45,000,000 shares authorized, 24,708,808 and 24,844,203 shares issued and outstanding at March 31, 2024 and June 30, 2023, respectively | 46,426 | 58,241 |
Retained earnings | 997,642 | 936,678 |
Accumulated other comprehensive loss | (100,017) | (89,621) |
Total shareholders’ equity | 944,051 | 905,298 |
Total liabilities and shareholders’ equity | $ 1,782,988 | $ 2,068,169 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Current assets: | ||
Allowance for accounts receivable | $ 19,566 | $ 15,480 |
Shareholders’ equity: | ||
Preferred stock, shares authorized (in shares) | 3,000,000 | 3,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, shares authorized (in shares) | 45,000,000 | 45,000,000 |
Common stock, share issued (in shares) | 24,708,808 | 24,844,203 |
Common stock, shares outstanding (in shares) | 24,708,808 | 24,844,203 |
CONDENSED CONSOLIDATED INCOME S
CONDENSED CONSOLIDATED INCOME STATEMENTS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||||
Net sales | $ 752,599 | $ 885,519 | $ 2,513,696 | $ 2,840,573 |
Cost of goods sold | 658,118 | 773,757 | 2,211,958 | 2,499,992 |
Gross profit | 94,481 | 111,762 | 301,738 | 340,581 |
Selling, general and administrative expenses | 66,574 | 70,669 | 208,930 | 211,337 |
Depreciation expense | 2,690 | 2,644 | 8,449 | 8,085 |
Intangible amortization expense | 3,752 | 4,170 | 11,982 | 12,561 |
Restructuring expense | 3,923 | 0 | 3,923 | 0 |
Operating income | 17,542 | 34,279 | 68,454 | 108,598 |
Interest expense | 2,001 | 5,715 | 10,947 | 14,223 |
Interest income | (2,652) | (1,710) | (6,096) | (5,327) |
Gain on sale of business | 0 | 0 | (14,533) | 0 |
Other expense, net | 241 | 361 | 991 | 1,314 |
Income before income taxes | 17,952 | 29,913 | 77,145 | 98,388 |
Provision for income taxes | 5,146 | 8,692 | 16,181 | 27,391 |
Net income | $ 12,806 | $ 21,221 | $ 60,964 | $ 70,997 |
Per share data: | ||||
Net income per common share, basic (in dollars per share) | $ 0.51 | $ 0.84 | $ 2.44 | $ 2.81 |
Weighted-average shares outstanding, basic (in shares) | 25,025 | 25,196 | 24,982 | 25,228 |
Net income per common share, diluted (in dollars per share) | $ 0.50 | $ 0.83 | $ 2.41 | $ 2.79 |
Weighted-average shares outstanding, diluted (in shares) | 25,437 | 25,439 | 25,291 | 25,436 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 12,806 | $ 21,221 | $ 60,964 | $ 70,997 |
Unrealized gain (loss) on hedged transaction, net of tax | 148 | (1,165) | (1,246) | 718 |
Realized foreign currency gain on sale of business | 0 | 0 | 3,805 | 0 |
Foreign currency translation adjustment | (4,947) | 4,291 | (12,955) | 4,474 |
Comprehensive income | $ 8,007 | $ 24,347 | $ 50,568 | $ 76,189 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common Stock | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning balance (in shares) at Jun. 30, 2022 | 25,187,351 | |||
Beginning balance at Jun. 30, 2022 | $ 806,528 | $ 64,297 | $ 846,869 | $ (104,638) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 24,042 | 24,042 | ||
Unrealized gain (loss) on hedged transaction, net of tax | 1,879 | 1,879 | ||
Foreign currency translation adjustment | (7,217) | (7,217) | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 38,551 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | (586) | $ (586) | ||
Share-based compensation | 2,358 | $ 2,358 | ||
Ending balance (in shares) at Sep. 30, 2022 | 25,225,902 | |||
Ending balance at Sep. 30, 2022 | 827,004 | $ 66,069 | 870,911 | (109,976) |
Beginning balance (in shares) at Jun. 30, 2022 | 25,187,351 | |||
Beginning balance at Jun. 30, 2022 | 806,528 | $ 64,297 | 846,869 | (104,638) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 70,997 | |||
Unrealized gain (loss) on hedged transaction, net of tax | 718 | |||
Foreign currency translation adjustment | 4,474 | |||
Realized foreign currency translation gain from disposal of a business | 0 | |||
Ending balance (in shares) at Mar. 31, 2023 | 25,007,396 | |||
Ending balance at Mar. 31, 2023 | 878,895 | $ 60,475 | 917,866 | (99,446) |
Beginning balance (in shares) at Sep. 30, 2022 | 25,225,902 | |||
Beginning balance at Sep. 30, 2022 | 827,004 | $ 66,069 | 870,911 | (109,976) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 25,734 | 25,734 | ||
Unrealized gain (loss) on hedged transaction, net of tax | 3 | 3 | ||
Foreign currency translation adjustment | 7,401 | 7,401 | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 117,112 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | (1,112) | $ (1,112) | ||
Share-based compensation | 3,356 | $ 3,356 | ||
Ending balance (in shares) at Dec. 31, 2022 | 25,343,014 | |||
Ending balance at Dec. 31, 2022 | 862,386 | $ 68,313 | 896,645 | (102,572) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 21,221 | 21,221 | ||
Unrealized gain (loss) on hedged transaction, net of tax | (1,165) | (1,165) | ||
Foreign currency translation adjustment | 4,291 | 4,291 | ||
Realized foreign currency translation gain from disposal of a business | 0 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 20,851 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 118 | $ 118 | ||
Common stock repurchased (in shares) | (356,469) | |||
Common stock repurchased | (10,906) | $ (10,906) | ||
Share-based compensation | 2,950 | $ 2,950 | ||
Ending balance (in shares) at Mar. 31, 2023 | 25,007,396 | |||
Ending balance at Mar. 31, 2023 | 878,895 | $ 60,475 | 917,866 | (99,446) |
Beginning balance (in shares) at Jun. 30, 2023 | 24,844,203 | |||
Beginning balance at Jun. 30, 2023 | 905,298 | $ 58,241 | 936,678 | (89,621) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 15,432 | 15,432 | ||
Unrealized gain (loss) on hedged transaction, net of tax | 153 | 153 | ||
Foreign currency translation adjustment | (6,890) | (6,890) | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 116,028 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | (1,510) | $ (1,510) | ||
Share-based compensation | 2,770 | $ 2,770 | ||
Ending balance (in shares) at Sep. 30, 2023 | 24,960,231 | |||
Ending balance at Sep. 30, 2023 | 915,253 | $ 59,501 | 952,110 | (96,358) |
Beginning balance (in shares) at Jun. 30, 2023 | 24,844,203 | |||
Beginning balance at Jun. 30, 2023 | 905,298 | $ 58,241 | 936,678 | (89,621) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 60,964 | |||
Unrealized gain (loss) on hedged transaction, net of tax | (1,246) | |||
Foreign currency translation adjustment | (12,955) | |||
Realized foreign currency translation gain from disposal of a business | 3,805 | |||
Ending balance (in shares) at Mar. 31, 2024 | 24,708,808 | |||
Ending balance at Mar. 31, 2024 | 944,051 | $ 46,426 | 997,642 | (100,017) |
Beginning balance (in shares) at Sep. 30, 2023 | 24,960,231 | |||
Beginning balance at Sep. 30, 2023 | 915,253 | $ 59,501 | 952,110 | (96,358) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 32,726 | 32,726 | ||
Unrealized gain (loss) on hedged transaction, net of tax | (1,547) | (1,547) | ||
Foreign currency translation adjustment | (1,118) | (1,118) | ||
Realized foreign currency translation gain from disposal of a business | 3,805 | 3,805 | ||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 230,543 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 3,162 | $ 3,162 | ||
Common stock repurchased (in shares) | (36,305) | |||
Common stock repurchased | (1,251) | $ (1,251) | ||
Share-based compensation | 2,571 | $ 2,571 | ||
Ending balance (in shares) at Dec. 31, 2023 | 25,154,469 | |||
Ending balance at Dec. 31, 2023 | 953,601 | $ 63,983 | 984,836 | (95,218) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income | 12,806 | 12,806 | ||
Unrealized gain (loss) on hedged transaction, net of tax | 148 | 148 | ||
Foreign currency translation adjustment | (4,947) | (4,947) | ||
Realized foreign currency translation gain from disposal of a business | 0 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes (in shares) | 24,220 | |||
Exercise of stock options and shares issued under share-based compensation plans, net of shares withheld for employee taxes | 180 | $ 180 | ||
Common stock repurchased (in shares) | (469,881) | |||
Common stock repurchased | (20,117) | $ (20,117) | ||
Share-based compensation | 2,380 | $ 2,380 | ||
Ending balance (in shares) at Mar. 31, 2024 | 24,708,808 | |||
Ending balance at Mar. 31, 2024 | $ 944,051 | $ 46,426 | $ 997,642 | $ (100,017) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities: | ||
Net Income | $ 60,964 | $ 70,997 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Gain on sale of business | (14,533) | 0 |
Depreciation and amortization | 21,217 | 21,359 |
Amortization of debt issue costs | 289 | 481 |
Provision for doubtful accounts | 5,863 | 1,852 |
Share-based compensation | 7,729 | 8,633 |
Deferred income taxes | (1,565) | 1,409 |
Finance lease interest | 70 | 31 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 143,774 | 46,652 |
Inventories | 226,878 | (136,257) |
Prepaid expenses and other assets | (28,163) | 39,178 |
Other non-current assets | 6,022 | (1,772) |
Accounts payable | (117,860) | (60,717) |
Accrued expenses and other liabilities | 11,338 | (16,780) |
Income taxes payable | (5,115) | 4,426 |
Net cash provided by (used in) operating activities | 316,908 | (20,508) |
Cash flows from investing activities: | ||
Capital expenditures | (7,285) | (6,549) |
Proceeds from sale of business, net of cash transferred | 17,978 | 0 |
Net cash provided by (used in) investing activities | 10,693 | (6,549) |
Cash flows from financing activities: | ||
Borrowings on revolving credit, net of expenses | 1,242,915 | 1,871,909 |
Repayments on revolving credit, net of expenses | (1,421,895) | (1,848,554) |
(Repayments) borrowings on long-term debt, net | (5,040) | 16,527 |
Repayments on finance lease obligation | (585) | (612) |
Debt issuance costs | 0 | (1,407) |
Exercise of stock options | 4,626 | 853 |
Taxes paid on settlement of equity awards | (2,794) | (2,433) |
Common stock repurchased | (21,168) | (10,718) |
Net cash (used in) provided by financing activities | (203,941) | 25,565 |
Effect of exchange rate changes on cash and cash equivalents | (788) | 879 |
Increase (decrease) in cash and cash equivalents | 122,872 | (613) |
Cash and cash equivalents at beginning of period | 36,178 | 37,987 |
Cash and cash equivalents at end of period | $ 159,050 | $ 37,374 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 9 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Business Description ScanSource, Inc. (together with its subsidiaries referred to as “the Company” or “ScanSource”) is a leading hybrid distributor connecting devices to the cloud and accelerating growth for partners across hardware, Software as a Service ("SaaS"), connectivity and cloud. The Company brings technology solutions and services from the world’s leading suppliers of mobility and barcode, point-of-sale ("POS"), payments, networking, physical security, unified communications and collaboration, telecom and cloud services to market. The Company operates primarily in the United States, Canada and Brazil. The Company's two operating segments, Specialty Technology Solutions and Modern Communications & Cloud, are based on technology type and are generally related to (i) technology devices and (ii) communication, connectivity and cloud services, respectively. Some of the offerings of our major suppliers include products that blend technologies and include both technology devices and communication and connectivity and cloud services products. We assign all of the offerings of those suppliers' products to the same segment based on which technology predominates the offering. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company have been prepared by the Company’s management in accordance with United States generally accepted accounting principles ("U.S. GAAP") for interim financial information and applicable rules and regulations of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. The unaudited condensed consolidated financial statements included herein contain all adjustments (consisting of normal recurring and non-recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position at March 31, 2024 and June 30, 2023, the results of operations for the quarters and nine months ended March 31, 2024 and 2023, the condensed consolidated statements of comprehensive income for the quarters and nine months ended March 31, 2024 and 2023, the condensed consolidated statements of shareholders' equity for the quarters and nine months ended March 31, 2024 and 2023 and the condensed consolidated statements of cash flows for the nine months ended March 31, 2024 and 2023. The results of operations for the quarter and nine months ended March 31, 2024 are not necessarily indicative of the results to be expected for a full year. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. Unless otherwise indicated, disclosures provided in the notes to the Company's consolidated financial statements pertain to continuing operations only. Summary of Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies for the nine months ended March 31, 2024 from the policies described in the notes to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2023. For a discussion of the Company’s significant accounting policies, please see the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. Cash and Cash Equivalents The Company considers all highly-liquid investments with original maturities of three months or less, when purchased, to be cash equivalents. The Company maintains zero-balance disbursement accounts at various financial institutions at which the Company does not maintain significant depository relationships. Due to the terms of the agreements governing these accounts, the Company generally does not have the right to offset outstanding checks written from these accounts against cash on hand, and the respective institutions are not legally obligated to honor the checks until sufficient funds are transferred to fund the checks. As a result, checks released but not yet cleared from these accounts in the amount of $0.2 million and $8.0 million are included in accounts payable on the condensed consolidated balance sheets at March 31, 2024 and June 30, 2023, respectively. Long-lived Assets The Company presents depreciation expense and intangible amortization expense on the condensed consolidated income statements. The Company's depreciation expense related to selling, general and administrative costs totaled $2.7 million and $8.4 million for the quarter and nine months ended March 31, 2024 and $2.6 million and $8.1 million for the quarter and nine months ended March 31, 2023. Depreciation expense reported as part of cost of goods sold on the condensed consolidated income statements totaled $0.3 million and $0.8 million for the quarter and nine months ended March 31, 2024 and $0.3 million and $0.7 million for the quarter and nine months ended March 31, 2023. The Company's intangible amortization expense reported on the condensed consolidated income statements relates to selling, general and administrative costs, not the cost of selling goods. Intangible amortization expense totaled $3.8 million and $12.0 million for the quarter and nine months ended March 31, 2024 and $4.2 million and $12.6 million for the quarter and nine months ended March 31, 2023. Recent Accounting Pronouncements In July 2023, the Securities and Exchange Commission issued final rules that require new and enhanced disclosures on cybersecurity risk management, strategy, governance, and incident reporting. Under the final rules, companies must report a material cybersecurity incident on Form 8-K within four business days of determining that such cybersecurity incident is material. To the extent the nature, scope, timing or the impact of the incident is not determinable at the time such Form 8-K is required to be filed, additional information about the material aspects of the cybersecurity incident must be filed on a Form 8-K/A within four business days after such additional information becomes available. These disclosure requirements on Form 8-K were effective beginning December 18, 2023. For fiscal years ending on or after December 15, 2023, companies must disclose their cybersecurity processes, management's role in cybersecurity governance, and cybersecurity oversight by the Board of Directors on Form 10-K. In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. This ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. This ASU is applicable to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, and subsequent interim periods, with early application permitted. The Company is currently evaluating the impact of the application of this ASU on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU No. 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This ASU updates income tax disclosure requirements primarily by requiring specific categories and greater disaggregation within the rate reconciliation and disaggregation of income taxes paid by jurisdiction. This ASU is effective for annual periods beginning after December 15, 2024 and is applicable to the Company’s fiscal year beginning July 1, 2025, with early application permitted. The Company is currently evaluating the impact of the application of this ASU on its consolidated financial statements and disclosures. The Company has reviewed other newly issued accounting pronouncements and concluded that they are either not applicable to its business or that no material effect is expected on its consolidated financial statements as a result of future adoption. |
Trade Accounts and Notes Receiv
Trade Accounts and Notes Receivable, Net | 9 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Trade Accounts and Notes Receivable, Net | Trade Accounts and Notes Receivable, Net The Company maintains an allowance for doubtful accounts receivable for estimated future expected credit losses resulting from customers’ failure to make payments on accounts receivable due to the Company. The Company has notes receivable with certain customers, which are included in “Accounts receivable, less allowance” in the Condensed Consolidated Balance Sheets. Management determines the estimate of the allowance for doubtful accounts receivable by considering a number of factors, including: (i) historical experience, (ii) aging of the accounts receivable, (iii) specific information obtained by the Company on the financial condition and the current creditworthiness of its customers, (iv) the current economic and country-specific environment and (v) reasonable and supportable forecasts about collectability. Expected credit losses are estimated on a pool basis when similar risk characteristics exist using an age-based reserve model. Receivables that do not share risk characteristics are evaluated on an individual basis. Estimates of expected credit losses on trade receivables over the contractual life are recorded at inception and adjusted over the contractual life. The changes in the allowance for doubtful accounts for the nine months ended March 31, 2024 are set forth in the table below. June 30, 2023 Amounts Charged to Expense Write-offs Other (1) March 31, 2024 (in thousands) Trade accounts and current notes receivable allowance $ 15,480 $ 5,863 $ (1,975) $ 198 $ 19,566 (1) |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company provides technology solutions and services from the leading global suppliers of mobility, barcode, POS, payments, physical security, unified communications, collaboration, telecom and cloud services. This includes hardware, related accessories and device configuration as well as software licenses, professional services and hardware support programs. In determining the appropriate amount of revenue to recognize, the Company applies the following five-step model: (i) identify contracts with customers; (ii) identify performance obligations in the contracts; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations per the contracts; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company recognizes revenue as control of products and services are transferred to customers, which is generally at the point of shipment. The Company delivers products to customers in several ways, including: (i) shipment from a Company warehouse, (ii) drop-shipment directly from the supplier, or (iii) electronic delivery for non-physical products. Principal versus Agent Considerations The Company is the principal for sales of all hardware and certain software and services. The Company considers itself the principal in those transactions where it has control of the product or service before it is transferred to the customer. The Company recognizes the principal-associated revenue and cost of goods sold on a gross basis. The Company is the agent for third-party service contracts, including product warranties and supplier-hosted software. These service contracts are sold separately from the products, and the Company often serves as the agent for the contract on behalf of the original equipment manufacturer. The Company's responsibility is to arrange for the provision of the specified service by the original equipment manufacturer, and the Company does not control the specified service before it is transferred to the customer. Because the Company acts as an agent, revenue is recognized net of cost at the time of sale. The Intelisys business operates under an agency model. Variable Considerations For certain transactions, products are sold with a right of return and may also provide other rebates or incentives, which are accounted for as variable consideration. The Company estimates a returns allowance based on historical experience and reduces revenue accordingly. The Company estimates the amount of variable consideration for rebates and incentives by using the expected value to be given to the customer and reduces the revenue by those estimated amounts. These estimates are reviewed and updated as necessary at the end of each reporting period. Contract Balances The Company records contract assets and liabilities for payments received from customers in advance of services performed. These assets and liabilities are the result of the sales of the Company's self-branded warranty programs and other transactions where control has not yet passed to the customer. These amounts are immaterial to the consolidated financial statements for the periods presented. Disaggregation of Revenue The following tables represent the Company's disaggregation of revenue: Quarter ended March 31, 2024 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service Hardware, software and cloud (excluding Intelisys) $ 483,704 $ 248,029 $ 731,733 Intelisys connectivity and cloud — 20,866 20,866 $ 483,704 $ 268,895 $ 752,599 Nine months ended March 31, 2024 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service: Hardware, software and cloud (excluding Intelisys) $ 1,513,926 $ 936,946 $ 2,450,872 Intelisys connectivity and cloud — 62,824 62,824 $ 1,513,926 $ 999,770 $ 2,513,696 Quarter ended March 31, 2023 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service Hardware, software and cloud (excluding Intelisys) $ 565,652 $ 299,803 $ 865,455 Intelisys connectivity and cloud — 20,064 20,064 $ 565,652 $ 319,867 $ 885,519 Nine months ended March 31, 2023 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service: Hardware, software and cloud (excluding Intelisys) $ 1,769,530 $ 1,012,176 $ 2,781,706 Intelisys connectivity and cloud — 58,867 58,867 $ 1,769,530 $ 1,071,043 $ 2,840,573 |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share are computed by dividing net income by the weighted-average number of common shares outstanding. Diluted earnings per share are computed by dividing net income by the weighted-average number of common and potential common shares outstanding. Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands, except per share data) Numerator: Net income $ 12,806 $ 21,221 $ 60,964 $ 70,997 Denominator: Weighted-average shares, basic 25,025 25,196 24,982 25,228 Dilutive effect of share-based payments 412 243 309 208 Weighted-average shares, diluted 25,437 25,439 25,291 25,436 Net income per common share, basic $ 0.51 $ 0.84 $ 2.44 $ 2.81 Net income per common share, diluted $ 0.50 $ 0.83 $ 2.41 $ 2.79 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Mar. 31, 2024 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss, net of tax are as follows: March 31, 2024 June 30, 2023 (in thousands) Foreign currency translation adjustment $ (102,285) $ (93,136) Unrealized gain on hedged transaction, net of tax 2,268 3,515 Accumulated other comprehensive loss $ (100,017) $ (89,621) The tax effect of amounts in comprehensive loss reflect a tax expense (benefit) as follows: Quarter ended March 31, Nine months ended March 31, 2024 2023 2024 2023 (in thousands) Tax expense (benefit) $ 136 $ (354) $ (555) $ 225 |
Goodwill and Other Identifiable
Goodwill and Other Identifiable Intangible Assets | 9 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets The changes in the carrying amount of goodwill for the nine months ended March 31, 2024, by reporting segment, are set forth in the table below. Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Balance at June 30, 2023 $ 16,370 $ 200,336 $ 216,706 Goodwill disposed upon business sale — (8,539) (8,539) Foreign currency translation adjustment — (551) (551) Balance at March 31, 2024 $ 16,370 $ 191,246 $ 207,616 The following table shows changes in the amount recognized for net identifiable intangible assets for the nine months ended March 31, 2024. Net Identifiable Intangible Assets (in thousands) Balance at June 30, 2023 $ 68,495 Intangibles disposed upon business sale (14,927) Amortization expense (11,982) Foreign currency translation adjustment (76) Balance at March 31, 2024 $ 41,510 |
Short-Term Borrowings and Long-
Short-Term Borrowings and Long-Term Debt | 9 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings and Long-Term Debt | Short-Term Borrowings and Long-Term Debt The following table presents the Company’s debt at March 31, 2024 and June 30, 2023. March 31, 2024 June 30, 2023 (in thousands) Current portion of long-term debt $ 7,857 $ 6,915 Mississippi revenue bond, net of current portion 3,024 3,381 Senior secured term loan facility, net of current portion 135,000 140,625 Borrowings under revolving credit facility — 178,980 Total debt $ 145,881 $ 329,901 Credit Facility The Company has a multi-currency senior secured credit facility (as amended, the "Amended Credit Agreement") with JPMorgan Chase Bank N.A., as administrative agent (the "Administrative Agent"), and a syndicate of banks (collectively the "Lenders"). On September 28, 2022, the Company amended and restated the Amended Credit Agreement, which includes (i) a five-year, $350 million multicurrency senior secured revolving credit facility and (ii) a five-year $150 million senior secured term loan facility. The Amended Credit Agreement extended the credit facility maturity date to September 28, 2027. In addition, pursuant to an “accordion feature,” the Company may increase its borrowing limit by up to an additional $250 million, subject to obtaining additional credit commitments from the lenders participating in the increase. The Amended Credit Agreement allows for the issuance of up to $50 million for letters of credit. Borrowings under the Amended Credit Agreement are guaranteed by substantially all of the domestic subsidiaries of the Company and secured by their assets. Under the terms of the revolving credit facility, the payment of cash dividends is restricted. The Company incurred debt issuance costs of $1.4 million in connection with the amendment and restatement of the Amended Credit Agreement. These costs were capitalized to other non-current assets on the Condensed Consolidated Balance Sheets and added to the unamortized debt issuance costs from the previous credit facility. Loans denominated in U.S. dollars, other than swingline loans, bear interest at a rate per annum equal to, at the Company’s option, (i) the adjusted term Secured Overnight Financing Rate ("SOFR") or adjusted daily simple SOFR plus an additional margin ranging from 1.00% to 1.75% depending upon the Company’s ratio of (A) total consolidated debt less up to $30 million of unrestricted domestic cash to (B) trailing four-quarter consolidated EBITDA measured as of the end of the most recent year or quarter, as applicable, for which financial statements have been delivered to the Lenders (the “leverage ratio”); or (ii) the alternate base rate plus an additional margin ranging from 0% to 0.75%, depending upon the Company’s leverage ratio, plus, if applicable, certain mandatory costs. All swingline loans denominated in U.S. dollars bear interest based upon the adjusted daily simple SOFR plus an additional margin ranging from 1.00% to 1.75% depending upon the Company's leverage ratio, or such other rate as the Company and the applicable swingline lender may agree. The adjusted term SOFR and adjusted daily simple SOFR include a fixed credit adjustment of 0.10% over the applicable SOFR reference rate. Loans denominated in foreign currencies bear interest at a rate per annum equal to the applicable benchmark rate set forth in the Amended Credit Agreement plus an additional margin ranging from 1.00% to 1.75%, depending upon the Company’s leverage ratio plus, if applicable, certain mandatory costs. During the quarter and nine months ended March 31, 2024, all of the Company's borrowings under the Amended Credit Agreement were U.S. dollar loans. The spread in effect as of March 31, 2024 was 1.25%, plus a 0.10% credit spread adjustment for SOFR-based loans and 0.25% for alternate base rate loans. The commitment fee rate in effect at March 31, 2024 was 0.20%. The Amended Credit Agreement includes customary representations, warranties and affirmative and negative covenants, including financial covenants. Specifically, the Company’s Leverage Ratio must be less than or equal to 3.50 to 1.00 at all times. In addition, the Company’s Interest Coverage Ratio (as such term is defined in the Amended Credit Agreement) must be at least 3.00 to 1.00 at the end of each fiscal quarter. In the event of a default, customary remedies are available to the lenders, including acceleration and increased interest rates. The Company was in compliance with all covenants under the Amended Credit Agreement at March 31, 2024. The average daily outstanding balance on the revolving credit facility, excluding the term loan facility, during the nine month periods ended March 31, 2024 and 2023 was $94.6 million an d $227.2 million, respectively. There was $350.0 million and $171.0 million available for additional borrowings as of March 31, 2024 and June 30, 2023, respectively. The effective interest rates for the revolving line of credit were 6.68% and 6.74% as of March 31, 2024 and June 30, 2023, respectively. There were no letters of credit issued under the multi-currency revolving credit facility at March 31, 2024 or June 30, 2023. Mississippi Revenue Bond On August 1, 2007, the Company entered into an agreement with the State of Mississippi to provide financing for the acquisition and installation of certain equipment to be utilized at the Company’s Southaven, Mississippi warehouse, through the issuance of an industrial development revenue bond. The bond matures on September 1, 2032. The bond accrues interest at the one-month term SOFR plus an adjustment of 0.10% plus a spread of 0.85%. The agreement also provides the bondholder with a put option, exercisable only within 180 days of each fifth anniversary of the agreement, requiring the Company to pay back the bonds at 100% of the principal amount outstanding. At March 31, 2024, the Company was in compliance with all covenants under this bond. The interest rates at March 31, 2024 and June 30, 2023 were 6.28% and 6.11%, respectively. Debt Issuance Costs At March 31, 2024, net debt issuance costs associated with the credit facility and bond totaled $1.3 million and are being amortized on a straight-line basis through the maturity date of each respective debt instrument. |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 9 Months Ended |
Mar. 31, 2024 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Derivatives and Hedging Activities | Derivatives and Hedging Activities The Company's results of operations could be materially impacted by significant changes in foreign currency exchange rates and interest rates. In an effort to manage the exposure to these risks, the Company periodically enters into various derivative instruments. The Company's accounting policies for these instruments are based on whether the instruments are designated as hedge or non-hedge instruments in accordance with U.S. GAAP. The Company records all derivatives on the Condensed Consolidated Balance Sheet at fair value. Derivatives that are not designated as hedging instruments or the ineffective portions of cash flow hedges are adjusted to fair value through earnings in other income and expense. Foreign Currency Derivatives – The Company conducts a portion of its business internationally in a variety of foreign currencies and is exposed to market risk for changes in foreign currency exchange rates. The Company attempts to hedge transaction exposures with natural offsets to the fullest extent possible and once these opportunities have been exhausted the Company uses currency options and forward contracts or other hedging instruments with third parties. These contracts will periodically hedge the exchange of various currencies, including the U.S. dollar, Brazilian real, euro, British pound and Canadian dollar. The Company had contracts outstanding for purposes of managing cash flows with notional amounts of $27.7 million and $34.3 million for the exchange of foreign currencies at March 31, 2024 and June 30, 2023, respectively. To date, the Company has chosen not to designate these derivatives as hedging instruments, and accordingly, these instruments are adjusted to fair value through earnings in other income and expense. Summarized financial information related to these derivative contracts and changes in the underlying value of the foreign currency exposures included in the Condensed Consolidated Income Statements for the quarters and nine months ended March 31, 2024 and 2023 are as follows: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Net foreign exchange derivative contract (gains) losses $ (526) $ 564 $ 132 $ 1,873 Net foreign currency transactional and re-measurement losses (gains) 1,034 (59) 1,500 (98) Net foreign currency exchange losses $ 508 $ 505 $ 1,632 $ 1,775 Net foreign currency exchange gains and losses consist of foreign currency transactional and functional currency re-measurements, offset by net foreign currency exchange contract gains and losses and are included in other income and expense. Foreign exchange gains and losses are generated as the result of fluctuations in the value of the U.S. dollar versus the Brazilian real, the U.S. dollar versus the euro, the British pound versus the euro, and the Canadian dollar versus the U.S. dollar. Interest Rates - The Company’s earnings are also affected by changes in interest rates due to the impact those changes have on interest expense from floating rate debt instruments. The Company manages its exposure to changes in interest rates by using interest rate swaps to hedge this exposure and to achieve a desired proportion of fixed versus floating rate debt. On April 30, 2019, the Company entered into an interest rate swap agreement to lock into a fixed LIBOR interest rate, which was amended on September 28, 2022, to change the reference rate from LIBOR to SOFR. The swap agreement has a notional amount of $100.0 million, with a $50.0 million tranche that matured on April 30, 2024 and a $50.0 million tranche scheduled to mature April 30, 2026. On March 31, 2023, the Company entered into an interest rate swap agreement to lock into a fixed SOFR interest rate with a notional amount of $25 million and a maturity date of March 31, 2028. These interest rate swap agreements are designated as cash flow hedges to hedge the variable rate interest payments on the revolving credit facility. Interest rate differentials paid or received under the swap agreements are recognized as adjustments to interest expense. To the extent the swaps are effective in offsetting the variability of the hedged cash flows, changes in the fair value of the swaps are not included in current earnings but are reported as other comprehensive income (loss). There was no ineffective portion to be recorded as an adjustment to earnings for the quarters and nine months ended March 31, 2024 and 2023. The components of the cash flow hedge included in the Condensed Consolidated Statement of Comprehensive Income for the quarters and nine months ended March 31, 2024 and 2023, are as follows: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Net interest income recognized as a result of interest rate swap $ (895) $ (556) $ (2,676) $ (869) Unrealized gain (loss) in fair value of interest rate swap 1,093 (1,013) 1,021 1,837 Net increase (decrease) in accumulated other comprehensive income 198 (1,569) (1,655) 968 Income tax effect 50 (404) (409) 250 Net increase (decrease) in accumulated other comprehensive income, net of tax $ 148 $ (1,165) $ (1,246) $ 718 The Company used the following derivative instruments at March 31, 2024 and June 30, 2023, reflected in its Condensed Consolidated Balance Sheets, for the risk management purposes detailed above: March 31, 2024 June 30, 2023 Balance Sheet Location Fair Value of Fair Value of Fair Value of Fair Value of (in thousands) Derivative assets: Foreign exchange contracts Prepaid expenses and other current assets — — — $1 Foreign currency hedge Prepaid expenses and other current assets $27 — $100 — Interest rate swap agreement Other non-current assets $3,032 — $4,687 — Derivative liabilities: Foreign exchange contracts Accrued expenses and other current liabilities — $15 — — |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Accounting guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Under this guidance, the Company classifies certain assets and liabilities based on the fair value hierarchy, which aggregates fair value measured assets and liabilities based upon the following levels of inputs: • Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2 – Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and • Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). The assets and liabilities maintained by the Company that are required to be measured at fair value on a recurring basis include deferred compensation plan investments, forward foreign currency exchange contracts, foreign currency hedge agreements and interest rate swap agreements. The carrying value of debt is considered to approximate fair value, as the Company’s debt instruments are indexed to a variable rate using the market approach (Level 2). The following table summarizes the valuation of the Company’s remaining assets and liabilities measured at fair value on a recurring basis at March 31, 2024: Total Quoted Significant (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 30,995 $ 30,995 $ — Interest rate swap agreement 3,032 — 3,032 Foreign currency hedge 27 — 27 Total assets at fair value $ 34,054 $ 30,995 $ 3,059 Liabilities: Deferred compensation plan investments, current and non-current portion $ 31,005 $ 31,005 $ — Forward foreign currency exchange contracts 15 — 15 Total liabilities at fair value $ 31,020 $ 31,005 $ 15 The following table summarizes the valuation of the Company’s remaining assets and liabilities measured at fair value on a recurring basis at June 30, 2023: Total Quoted Significant (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 28,209 $ 28,209 $ — Forward foreign currency exchange contracts 1 — 1 Foreign currency hedge 100 — 100 Interest rate swap agreement 4,687 — 4,687 Total assets at fair value $ 32,997 $ 28,209 $ 4,788 Liabilities: Deferred compensation plan investments, current and non-current portion $ 28,229 $ 28,229 $ — Total liabilities at fair value $ 28,229 $ 28,229 $ — The investments in the deferred compensation plan are held in a "rabbi trust" and include mutual funds and cash equivalents for payment of non-qualified benefits for certain retired, terminated and active employees. These investments are recorded to prepaid expenses and other current assets or other non-current assets depending on their corresponding, anticipated distribution dates to recipients, which are reported in accrued expenses and other current liabilities or other long-term liabilities, respectively. Derivative instruments, such as foreign currency forward contracts, are measured using the market approach on a recurring basis considering foreign currency spot rates and forward rates quoted by banks or foreign currency dealers and interest rates quoted by banks (Level 2). Fair values of interest rate swaps are measured using standard valuation models with inputs that can be derived from observable market transactions, including SOFR spot and forward rates (Level 2). Foreign currency contracts and interest rate swap agreements are classified in the Condensed Consolidated Balance Sheets as prepaid expenses and other non-current assets or accrued expenses and other long-term liabilities, depending on the respective instruments' favorable or unfavorable positions. See Note 8 - Derivatives and Hedging Activities . |
Segment Information
Segment Information | 9 Months Ended |
Mar. 31, 2024 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Segment Information | Segment Information The Company is a leading provider of technology solutions and services to customers in specialty technology markets. The Company has two reportable segments, based on technology type. Specialty Technology Solutions Segment The Specialty Technology Solutions segment includes the Company’s business in mobility and barcode, POS, payments, security and networking technologies as summarized below: • Mobility and barcode solutions - mobile computing, barcode scanners and imagers, radio frequency identification devices, barcode printing and related services • POS and payments solutions - POS systems, integrated POS software platforms, self-service kiosks including self-checkout, payment terminals and mobile payment devices • Security solutions - video surveillance and analytics, video management software and access control • Networking solutions - switching, routing and wireless products and software The Company primarily has business operations within this segment in the United States, Canada and Brazil. Modern Communications & Cloud Segment The Modern Communications & Cloud segment includes the Company’s business in communications and collaboration, connectivity and cloud services. Communications and collaboration solutions, delivered in the cloud, on-premise or hybrid, include voice, video, integration of communication platforms and contact center solutions. The Intelisys connectivity and cloud services include telecom, cable, Unified Communications as a Service, Contact Center as a Service, Infrastructure as a Service, Software-Defined Wide-Area Network and other cloud services. This segment includes SaaS and subscription services, which the Company offers using digital tools and platforms. The Company's business operations within this segment primarily are in the United States, Canada and Brazil. Selected financial information for each business segment is presented below: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Sales: Specialty Technology Solutions $ 483,704 $ 565,652 $ 1,513,926 $ 1,769,530 Modern Communications & Cloud 268,895 319,867 999,770 1,071,043 $ 752,599 $ 885,519 $ 2,513,696 $ 2,840,573 Depreciation and amortization: Specialty Technology Solutions $ 2,736 $ 2,638 $ 8,390 $ 8,099 Modern Communications & Cloud 3,287 3,717 10,621 11,102 Corporate 719 719 2,206 2,158 $ 6,742 $ 7,074 $ 21,217 $ 21,359 Operating income (loss): Specialty Technology Solutions $ 9,080 $ 19,811 $ 34,321 $ 61,345 Modern Communications & Cloud 12,989 14,468 40,004 47,253 Corporate (4,527) — (5,871) — $ 17,542 $ 34,279 $ 68,454 $ 108,598 Capital expenditures: Specialty Technology Solutions $ (567) $ (520) $ (2,133) $ (1,546) Modern Communications & Cloud (1,853) (1,766) (5,152) (5,003) $ (2,420) $ (2,286) $ (7,285) $ (6,549) Sales by Geography Category: United States and Canada $ 672,662 $ 811,963 $ 2,262,707 $ 2,584,598 International 81,353 76,722 256,067 263,017 Less intercompany sales (1,416) (3,166) (5,078) (7,042) $ 752,599 $ 885,519 $ 2,513,696 $ 2,840,573 March 31, 2024 June 30, 2023 (in thousands) Assets: Specialty Technology Solutions $ 892,866 $ 1,104,103 Modern Communications & Cloud 890,122 964,066 Corporate — — $ 1,782,988 $ 2,068,169 Property and equipment, net by Geography Category: United States and Canada $ 22,846 $ 27,323 International 12,748 10,056 $ 35,594 $ 37,379 |
Leases
Leases | 9 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Leases | Leases In accordance with Accounting Standards Codification ("ASC") 842, at contract inception the Company determines if a contract contains a lease by assessing whether the contract contains an identified asset and whether the Company has the ability to control the asset. The Company also determines if the lease meets the classification criteria for an operating lease versus a finance lease under ASC 842. Substantially all of the Company's leases are operating leases for real estate, warehouse and office equipment ranging in duration from 1 year to 10 years. The Company has elected not to record short-term operating leases with an initial term of 12 months or less on the Condensed Consolidated Balance Sheets. Operating leases are recorded as other non-current assets, accrued expenses and other current liabilities and other long-term liabilities on the Condensed Consolidated Balance Sheets. The Company has finance leases for information technology equipment expiring through fiscal year 2028. Finance leases are recorded as property and equipment, net accrued expenses and other current liabilities other long-term liabilities Operating lease right-of-use assets and lease liabilities are recognized at the commencement date based on the net present value of future minimum lease payments over the lease term. The Company generally is not able to determine the rate implicit in its leases and has elected to apply an incremental borrowing rate as the discount rate for the present value determination, which is based on the Company's cost of borrowings for the relevant terms of each lease and geographical economic factors. Certain operating lease agreements contain options to extend or terminate the lease. The lease term used is adjusted for these options when the Company is reasonably certain it will exercise the option. Operating lease expense is recognized on a straight-line basis over the lease term. Variable lease payments not based on a rate or index, such as costs for common area maintenance, are expensed as incurred. Further, the Company has elected the practical expedient to recognize all lease and non-lease components as a single lease component, where applicable. The following table presents amounts recorded on the Condensed Consolidated Balance Sheets related to operating leases at March 31, 2024 and June 30, 2023: March 31, 2024 June 30, 2023 Operating leases Balance Sheet location (in thousands) Operating lease right-of-use assets Other non-current assets $ 10,342 $ 12,539 Current operating lease liabilities Accrued expenses and other current liabilities $ 3,808 $ 4,355 Long-term operating lease liabilities Other long-term liabilities $ 7,440 $ 9,329 The following table presents amounts recorded in operating lease expense as part of selling general and administrative expenses on the Condensed Consolidated Income Statements during the quarters and nine months ended March 31, 2024 and 2023. Operating lease costs contain immaterial amounts of short-term lease costs for leases with an initial term of 12 months or less. Quarter ended March 31, Nine months ended March 31, 2024 2023 2024 2023 (in thousands) Operating lease cost $ 1,143 $ 1,319 $ 3,786 $ 3,896 Variable lease cost 364 396 1,069 1,158 $ 1,507 $ 1,715 $ 4,855 $ 5,054 Supplemental cash flow information related to the Company's operating leases for the nine months ended March 31, 2024 and 2023 are presented in the table below: Nine months ended March 31, 2024 2023 (in thousands) Cash paid for amounts in the measurement of lease liabilities $ 4,019 $ 4,054 Right-of-use assets obtained in exchange for lease obligations 840 746 The weighted-average remaining lease term and discount rate at March 31, 2024 are presented in the table below: March 31, 2024 Weighted-average remaining lease term 3.2 years Weighted-average discount rate 5.00 % The following table presents the maturities of the Company's operating lease liabilities at March 31, 2024: Operating leases (in thousands) 2024 $ 1,219 2025 4,169 2026 3,618 2027 3,176 2028 1,118 Thereafter 523 Total future payments 13,823 Less: amounts representing interest 2,575 Present value of lease payments $ 11,248 |
Leases | Leases In accordance with Accounting Standards Codification ("ASC") 842, at contract inception the Company determines if a contract contains a lease by assessing whether the contract contains an identified asset and whether the Company has the ability to control the asset. The Company also determines if the lease meets the classification criteria for an operating lease versus a finance lease under ASC 842. Substantially all of the Company's leases are operating leases for real estate, warehouse and office equipment ranging in duration from 1 year to 10 years. The Company has elected not to record short-term operating leases with an initial term of 12 months or less on the Condensed Consolidated Balance Sheets. Operating leases are recorded as other non-current assets, accrued expenses and other current liabilities and other long-term liabilities on the Condensed Consolidated Balance Sheets. The Company has finance leases for information technology equipment expiring through fiscal year 2028. Finance leases are recorded as property and equipment, net accrued expenses and other current liabilities other long-term liabilities Operating lease right-of-use assets and lease liabilities are recognized at the commencement date based on the net present value of future minimum lease payments over the lease term. The Company generally is not able to determine the rate implicit in its leases and has elected to apply an incremental borrowing rate as the discount rate for the present value determination, which is based on the Company's cost of borrowings for the relevant terms of each lease and geographical economic factors. Certain operating lease agreements contain options to extend or terminate the lease. The lease term used is adjusted for these options when the Company is reasonably certain it will exercise the option. Operating lease expense is recognized on a straight-line basis over the lease term. Variable lease payments not based on a rate or index, such as costs for common area maintenance, are expensed as incurred. Further, the Company has elected the practical expedient to recognize all lease and non-lease components as a single lease component, where applicable. The following table presents amounts recorded on the Condensed Consolidated Balance Sheets related to operating leases at March 31, 2024 and June 30, 2023: March 31, 2024 June 30, 2023 Operating leases Balance Sheet location (in thousands) Operating lease right-of-use assets Other non-current assets $ 10,342 $ 12,539 Current operating lease liabilities Accrued expenses and other current liabilities $ 3,808 $ 4,355 Long-term operating lease liabilities Other long-term liabilities $ 7,440 $ 9,329 The following table presents amounts recorded in operating lease expense as part of selling general and administrative expenses on the Condensed Consolidated Income Statements during the quarters and nine months ended March 31, 2024 and 2023. Operating lease costs contain immaterial amounts of short-term lease costs for leases with an initial term of 12 months or less. Quarter ended March 31, Nine months ended March 31, 2024 2023 2024 2023 (in thousands) Operating lease cost $ 1,143 $ 1,319 $ 3,786 $ 3,896 Variable lease cost 364 396 1,069 1,158 $ 1,507 $ 1,715 $ 4,855 $ 5,054 Supplemental cash flow information related to the Company's operating leases for the nine months ended March 31, 2024 and 2023 are presented in the table below: Nine months ended March 31, 2024 2023 (in thousands) Cash paid for amounts in the measurement of lease liabilities $ 4,019 $ 4,054 Right-of-use assets obtained in exchange for lease obligations 840 746 The weighted-average remaining lease term and discount rate at March 31, 2024 are presented in the table below: March 31, 2024 Weighted-average remaining lease term 3.2 years Weighted-average discount rate 5.00 % The following table presents the maturities of the Company's operating lease liabilities at March 31, 2024: Operating leases (in thousands) 2024 $ 1,219 2025 4,169 2026 3,618 2027 3,176 2028 1,118 Thereafter 523 Total future payments 13,823 Less: amounts representing interest 2,575 Present value of lease payments $ 11,248 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is, from time to time, party to lawsuits arising out of operations. Although there can be no assurance, based upon information known to the Company, the Company believes that any liability resulting from an adverse determination of such lawsuits would not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. During the Company's due diligence for the Network1 acquisition completed in 2016, several pre-acquisition contingencies were identified regarding various Brazilian federal and state tax exposures. The Company recorded indemnification receivables that are reported gross of the pre-acquisition contingency liabilities as the funds were escrowed as part of the acquisition. The amount available after the impact of foreign currency translation for future pre-acquisition contingency settlements or to be released to the sellers was $3.6 million and $3.4 million at March 31, 2024 and June 30, 2023. The table below summarizes the balances and line item presentation of Network1's pre-acquisition contingencies and corresponding indemnification receivables in the Company's Condensed Consolidated Balance Sheets at March 31, 2024 and June 30, 2023: March 31, 2024 June 30, 2023 Network1 (in thousands) Assets Prepaid expenses and other current assets $ 16 $ 16 Other non-current assets $ 4,003 $ 4,150 Liabilities Accrued expenses and other current liabilities $ 16 $ 16 Other long-term liabilities $ 4,003 $ 4,150 |
Income Taxes
Income Taxes | 9 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income taxes for the quarters and nine months ended March 31, 2024 and 2023 have been included in the accompanying condensed consolidated financial statements using an estimated annual effective tax rate. In addition to applying the estimated annual effective tax rate to pre-tax income, the Company includes certain items treated as discrete events to arrive at an estimated overall tax provision. During the quarter ended March 31, 2024, a discrete net tax benefit of $1.5 million was recorded, which is attributable to an income tax recovery in Brazil related to a prior period. The Company’s effective tax rate of 28.7% and 21.0% for the quarter and nine months ended March 31, 2024, differs from the current federal statutory rate of 21% primarily as a result of income derived from tax jurisdictions with varying income tax rates, discrete items, nondeductible expenses and state income taxes. The Company's effective tax rates were 29.1% and 27.8% for the quarter and nine months ended March 31, 2023. As of March 31, 2024, the Company is not permanently reinvested with respect to all earnings generated by foreign operations. The Company has determined that there is no material deferred tax liability for federal, state and withholding tax related to undistributed earnings. During the nine months ended March 31, 2024, foreign subsidiaries did not repatriate cash to the United States. There is no certainty to the timing of any future distributions of such earnings to the U.S. in whole or in part. The Company had approximately $1.2 million of total gross unrecognized tax benefits at March 31, 2024 and June 30, 2023. Of this total at March 31, 2024, approximately $1.0 million represents the amount of unrecognized tax benefits that are permanent in nature and, if recognized, would affect the annual effective tax rate. The Company does not believe that the total amount of unrecognized tax benefits will significantly increase or decrease within twelve months of the reporting date. The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. At March 31, 2024 and June 30, 2023, the Company had approximately $1.2 million accrued for interest and penalties. The Company conducts business globally and one or more of its subsidiaries files income tax returns in the U.S. federal, various state, local and foreign jurisdictions. In the normal course of business, the Company is subject to examination by taxing authorities in countries and states in which it operates. With certain exceptions, the Company is no longer subject to federal, state and local or non-U.S. income tax examinations by tax authorities for the years before June 30, 2018. |
Business Sale
Business Sale | 9 Months Ended |
Mar. 31, 2024 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Business Sale | Business Sale On December 19, 2023, the Company completed the sale of its UK-based intY business. The Company retained its CASCADE cloud services distribution platform which has been used to grow the Cisco and Microsoft subscription businesses in the United States and Brazil. Under the stock purchase agreement, the Company received proceeds of $18.0 million in cash for the sale, net of cash transferred. The business sale resulted in a $14.5 million |
Restructuring
Restructuring | 9 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In January 2024, as part of a strategic review of organizational structure and operations, the Company executed a cost reduction and restructuring program to align our cost structure with demand expectations in our hardware business. These actions are expected to result in approximately $10.0 million in annualized savings in selling, general and administrative expenses. The following table presents the restructuring and employee separation costs incurred for the quarter and nine months ended March 31, 2024: Quarter ended March 31, 2024 Nine months ended March 31, 2024 (in thousands) Employee separation and benefit costs $ 3,923 $ 3,923 For the quarter and nine months ended March 31, 2024, all restructuring costs are recognized in the Corporate reporting unit and have not been allocated to the Specialty Technology Solutions or Modern Communications & Cloud segments. Accrued restructuring costs are included in accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. The following table represents activity for the nine months ended March 31, 2024: Accrued Expenses (in thousands) Balance at June 30, 2023 $ — Charged to expense 3,923 Cash payments (1,125) Balance at March 31, 2024 $ 2,798 The remaining balance as of March 31, 2024 of $2.8 million is expected to be paid through the third quarter of fiscal year 2025. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Mar. 31, 2024 | Dec. 31, 2023 | Sep. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||||||||
Net Income | $ 12,806 | $ 32,726 | $ 15,432 | $ 21,221 | $ 25,734 | $ 24,042 | $ 60,964 | $ 70,997 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Business and Summary of Signi_2
Business and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements of the Company have been prepared by the Company’s management in accordance with United States generally accepted accounting principles ("U.S. GAAP") for interim financial information and applicable rules and regulations of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. The unaudited condensed consolidated financial statements included herein contain all adjustments (consisting of normal recurring and non-recurring adjustments) that are, in the opinion of management, necessary to present fairly the financial position at March 31, 2024 and June 30, 2023, the results of operations for the quarters and nine months ended March 31, 2024 and 2023, the condensed consolidated statements of comprehensive income for the quarters and nine months ended March 31, 2024 and 2023, the condensed consolidated statements of shareholders' equity for the quarters and nine months ended March 31, 2024 and 2023 and the condensed consolidated statements of cash flows for the nine months ended March 31, 2024 and 2023. The results of operations for the quarter and nine months ended March 31, 2024 are not necessarily indicative of the results to be expected for a full year. These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. Unless otherwise indicated, disclosures provided in the notes to the Company's consolidated financial statements pertain to continuing operations only. |
Summary of Significant Accounting Policies | There have been no material changes to the Company’s significant accounting policies for the nine months ended March 31, 2024 from the policies described in the notes to the Company’s consolidated financial statements included in the Annual Report on Form 10-K for the fiscal year ended June 30, 2023. For a discussion of the Company’s significant accounting policies, please see the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023. |
Cash and Cash Equivalents | The Company considers all highly-liquid investments with original maturities of three months or less, when purchased, to be cash equivalents. The Company maintains zero-balance disbursement accounts at various financial institutions at which the Company does not maintain significant depository relationships. Due to the terms of the agreements governing these accounts, the Company generally does not have the right to offset outstanding checks written from these accounts against cash on hand, and the respective institutions are not legally obligated to honor the checks until sufficient funds are transferred to fund the checks. |
Long-lived Assets | The Company presents depreciation expense and intangible amortization expense on the condensed consolidated income statements. |
Recent Accounting Pronouncements | In July 2023, the Securities and Exchange Commission issued final rules that require new and enhanced disclosures on cybersecurity risk management, strategy, governance, and incident reporting. Under the final rules, companies must report a material cybersecurity incident on Form 8-K within four business days of determining that such cybersecurity incident is material. To the extent the nature, scope, timing or the impact of the incident is not determinable at the time such Form 8-K is required to be filed, additional information about the material aspects of the cybersecurity incident must be filed on a Form 8-K/A within four business days after such additional information becomes available. These disclosure requirements on Form 8-K were effective beginning December 18, 2023. For fiscal years ending on or after December 15, 2023, companies must disclose their cybersecurity processes, management's role in cybersecurity governance, and cybersecurity oversight by the Board of Directors on Form 10-K. In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-07 “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. This ASU is effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024. This ASU is applicable to the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2025, and subsequent interim periods, with early application permitted. The Company is currently evaluating the impact of the application of this ASU on its consolidated financial statements and disclosures. In December 2023, the FASB issued ASU No. 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures.” This ASU updates income tax disclosure requirements primarily by requiring specific categories and greater disaggregation within the rate reconciliation and disaggregation of income taxes paid by jurisdiction. This ASU is effective for annual periods beginning after December 15, 2024 and is applicable to the Company’s fiscal year beginning July 1, 2025, with early application permitted. The Company is currently evaluating the impact of the application of this ASU on its consolidated financial statements and disclosures. The Company has reviewed other newly issued accounting pronouncements and concluded that they are either not applicable to its business or that no material effect is expected on its consolidated financial statements as a result of future adoption. |
Trade Accounts and Notes Receivable, Net | The Company maintains an allowance for doubtful accounts receivable for estimated future expected credit losses resulting from customers’ failure to make payments on accounts receivable due to the Company. The Company has notes receivable with certain customers, which are included in “Accounts receivable, less allowance” in the Condensed Consolidated Balance Sheets. Management determines the estimate of the allowance for doubtful accounts receivable by considering a number of factors, including: (i) historical experience, (ii) aging of the accounts receivable, (iii) specific information obtained by the Company on the financial condition and the current creditworthiness of its customers, (iv) the current economic and country-specific environment and (v) reasonable and supportable forecasts about collectability. Expected credit losses are estimated on a pool basis when similar risk characteristics exist using an age-based reserve model. Receivables that do not share risk characteristics are evaluated on an individual basis. Estimates of expected credit losses on trade receivables over the contractual life are recorded at inception and adjusted over the contractual life. |
Revenue Recognition | The Company provides technology solutions and services from the leading global suppliers of mobility, barcode, POS, payments, physical security, unified communications, collaboration, telecom and cloud services. This includes hardware, related accessories and device configuration as well as software licenses, professional services and hardware support programs. In determining the appropriate amount of revenue to recognize, the Company applies the following five-step model: (i) identify contracts with customers; (ii) identify performance obligations in the contracts; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations per the contracts; and (v) recognize revenue when (or as) the Company satisfies a performance obligation. The Company recognizes revenue as control of products and services are transferred to customers, which is generally at the point of shipment. The Company delivers products to customers in several ways, including: (i) shipment from a Company warehouse, (ii) drop-shipment directly from the supplier, or (iii) electronic delivery for non-physical products. Principal versus Agent Considerations The Company is the principal for sales of all hardware and certain software and services. The Company considers itself the principal in those transactions where it has control of the product or service before it is transferred to the customer. The Company recognizes the principal-associated revenue and cost of goods sold on a gross basis. The Company is the agent for third-party service contracts, including product warranties and supplier-hosted software. These service contracts are sold separately from the products, and the Company often serves as the agent for the contract on behalf of the original equipment manufacturer. The Company's responsibility is to arrange for the provision of the specified service by the original equipment manufacturer, and the Company does not control the specified service before it is transferred to the customer. Because the Company acts as an agent, revenue is recognized net of cost at the time of sale. The Intelisys business operates under an agency model. Variable Considerations For certain transactions, products are sold with a right of return and may also provide other rebates or incentives, which are accounted for as variable consideration. The Company estimates a returns allowance based on historical experience and reduces revenue accordingly. The Company estimates the amount of variable consideration for rebates and incentives by using the expected value to be given to the customer and reduces the revenue by those estimated amounts. These estimates are reviewed and updated as necessary at the end of each reporting period. Contract Balances The Company records contract assets and liabilities for payments received from customers in advance of services performed. These assets and liabilities are the result of the sales of the Company's self-branded warranty programs and other transactions where control has not yet passed to the customer. These amounts are immaterial to the consolidated financial statements for the periods presented. |
Trade Accounts and Notes Rece_2
Trade Accounts and Notes Receivable, Net (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Schedule of Changes in the Allowance for Doubtful Accounts | The changes in the allowance for doubtful accounts for the nine months ended March 31, 2024 are set forth in the table below. June 30, 2023 Amounts Charged to Expense Write-offs Other (1) March 31, 2024 (in thousands) Trade accounts and current notes receivable allowance $ 15,480 $ 5,863 $ (1,975) $ 198 $ 19,566 (1) |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following tables represent the Company's disaggregation of revenue: Quarter ended March 31, 2024 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service Hardware, software and cloud (excluding Intelisys) $ 483,704 $ 248,029 $ 731,733 Intelisys connectivity and cloud — 20,866 20,866 $ 483,704 $ 268,895 $ 752,599 Nine months ended March 31, 2024 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service: Hardware, software and cloud (excluding Intelisys) $ 1,513,926 $ 936,946 $ 2,450,872 Intelisys connectivity and cloud — 62,824 62,824 $ 1,513,926 $ 999,770 $ 2,513,696 Quarter ended March 31, 2023 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service Hardware, software and cloud (excluding Intelisys) $ 565,652 $ 299,803 $ 865,455 Intelisys connectivity and cloud — 20,064 20,064 $ 565,652 $ 319,867 $ 885,519 Nine months ended March 31, 2023 Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Revenue by product/service: Hardware, software and cloud (excluding Intelisys) $ 1,769,530 $ 1,012,176 $ 2,781,706 Intelisys connectivity and cloud — 58,867 58,867 $ 1,769,530 $ 1,071,043 $ 2,840,573 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands, except per share data) Numerator: Net income $ 12,806 $ 21,221 $ 60,964 $ 70,997 Denominator: Weighted-average shares, basic 25,025 25,196 24,982 25,228 Dilutive effect of share-based payments 412 243 309 208 Weighted-average shares, diluted 25,437 25,439 25,291 25,436 Net income per common share, basic $ 0.51 $ 0.84 $ 2.44 $ 2.81 Net income per common share, diluted $ 0.50 $ 0.83 $ 2.41 $ 2.79 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income, Net Of Tax | The components of accumulated other comprehensive loss, net of tax are as follows: March 31, 2024 June 30, 2023 (in thousands) Foreign currency translation adjustment $ (102,285) $ (93,136) Unrealized gain on hedged transaction, net of tax 2,268 3,515 Accumulated other comprehensive loss $ (100,017) $ (89,621) |
Schedule of Other Comprehensive Loss, Tax | The tax effect of amounts in comprehensive loss reflect a tax expense (benefit) as follows: Quarter ended March 31, Nine months ended March 31, 2024 2023 2024 2023 (in thousands) Tax expense (benefit) $ 136 $ (354) $ (555) $ 225 |
Goodwill and Other Identifiab_2
Goodwill and Other Identifiable Intangible Assets (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in the Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the nine months ended March 31, 2024, by reporting segment, are set forth in the table below. Specialty Technology Solutions Modern Communications & Cloud Total (in thousands) Balance at June 30, 2023 $ 16,370 $ 200,336 $ 216,706 Goodwill disposed upon business sale — (8,539) (8,539) Foreign currency translation adjustment — (551) (551) Balance at March 31, 2024 $ 16,370 $ 191,246 $ 207,616 |
Schedule of Net Identifiable Intangible Assets | The following table shows changes in the amount recognized for net identifiable intangible assets for the nine months ended March 31, 2024. Net Identifiable Intangible Assets (in thousands) Balance at June 30, 2023 $ 68,495 Intangibles disposed upon business sale (14,927) Amortization expense (11,982) Foreign currency translation adjustment (76) Balance at March 31, 2024 $ 41,510 |
Short-Term Borrowings and Lon_2
Short-Term Borrowings and Long-Term Debt (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table presents the Company’s debt at March 31, 2024 and June 30, 2023. March 31, 2024 June 30, 2023 (in thousands) Current portion of long-term debt $ 7,857 $ 6,915 Mississippi revenue bond, net of current portion 3,024 3,381 Senior secured term loan facility, net of current portion 135,000 140,625 Borrowings under revolving credit facility — 178,980 Total debt $ 145,881 $ 329,901 |
Derivatives and Hedging Activ_2
Derivatives and Hedging Activities (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Schedule of Derivative Contracts and Changes in Underlying Value of the Foreign Currency Exposures | Summarized financial information related to these derivative contracts and changes in the underlying value of the foreign currency exposures included in the Condensed Consolidated Income Statements for the quarters and nine months ended March 31, 2024 and 2023 are as follows: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Net foreign exchange derivative contract (gains) losses $ (526) $ 564 $ 132 $ 1,873 Net foreign currency transactional and re-measurement losses (gains) 1,034 (59) 1,500 (98) Net foreign currency exchange losses $ 508 $ 505 $ 1,632 $ 1,775 |
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) | The components of the cash flow hedge included in the Condensed Consolidated Statement of Comprehensive Income for the quarters and nine months ended March 31, 2024 and 2023, are as follows: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Net interest income recognized as a result of interest rate swap $ (895) $ (556) $ (2,676) $ (869) Unrealized gain (loss) in fair value of interest rate swap 1,093 (1,013) 1,021 1,837 Net increase (decrease) in accumulated other comprehensive income 198 (1,569) (1,655) 968 Income tax effect 50 (404) (409) 250 Net increase (decrease) in accumulated other comprehensive income, net of tax $ 148 $ (1,165) $ (1,246) $ 718 |
Schedule of Derivative Instruments | The Company used the following derivative instruments at March 31, 2024 and June 30, 2023, reflected in its Condensed Consolidated Balance Sheets, for the risk management purposes detailed above: March 31, 2024 June 30, 2023 Balance Sheet Location Fair Value of Fair Value of Fair Value of Fair Value of (in thousands) Derivative assets: Foreign exchange contracts Prepaid expenses and other current assets — — — $1 Foreign currency hedge Prepaid expenses and other current assets $27 — $100 — Interest rate swap agreement Other non-current assets $3,032 — $4,687 — Derivative liabilities: Foreign exchange contracts Accrued expenses and other current liabilities — $15 — — |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value | The following table summarizes the valuation of the Company’s remaining assets and liabilities measured at fair value on a recurring basis at March 31, 2024: Total Quoted Significant (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 30,995 $ 30,995 $ — Interest rate swap agreement 3,032 — 3,032 Foreign currency hedge 27 — 27 Total assets at fair value $ 34,054 $ 30,995 $ 3,059 Liabilities: Deferred compensation plan investments, current and non-current portion $ 31,005 $ 31,005 $ — Forward foreign currency exchange contracts 15 — 15 Total liabilities at fair value $ 31,020 $ 31,005 $ 15 The following table summarizes the valuation of the Company’s remaining assets and liabilities measured at fair value on a recurring basis at June 30, 2023: Total Quoted Significant (in thousands) Assets: Deferred compensation plan investments, current and non-current portion $ 28,209 $ 28,209 $ — Forward foreign currency exchange contracts 1 — 1 Foreign currency hedge 100 — 100 Interest rate swap agreement 4,687 — 4,687 Total assets at fair value $ 32,997 $ 28,209 $ 4,788 Liabilities: Deferred compensation plan investments, current and non-current portion $ 28,229 $ 28,229 $ — Total liabilities at fair value $ 28,229 $ 28,229 $ — |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Schedule of Financial Information by Segment | Selected financial information for each business segment is presented below: Quarter ended Nine months ended March 31, March 31, 2024 2023 2024 2023 (in thousands) Sales: Specialty Technology Solutions $ 483,704 $ 565,652 $ 1,513,926 $ 1,769,530 Modern Communications & Cloud 268,895 319,867 999,770 1,071,043 $ 752,599 $ 885,519 $ 2,513,696 $ 2,840,573 Depreciation and amortization: Specialty Technology Solutions $ 2,736 $ 2,638 $ 8,390 $ 8,099 Modern Communications & Cloud 3,287 3,717 10,621 11,102 Corporate 719 719 2,206 2,158 $ 6,742 $ 7,074 $ 21,217 $ 21,359 Operating income (loss): Specialty Technology Solutions $ 9,080 $ 19,811 $ 34,321 $ 61,345 Modern Communications & Cloud 12,989 14,468 40,004 47,253 Corporate (4,527) — (5,871) — $ 17,542 $ 34,279 $ 68,454 $ 108,598 Capital expenditures: Specialty Technology Solutions $ (567) $ (520) $ (2,133) $ (1,546) Modern Communications & Cloud (1,853) (1,766) (5,152) (5,003) $ (2,420) $ (2,286) $ (7,285) $ (6,549) Sales by Geography Category: United States and Canada $ 672,662 $ 811,963 $ 2,262,707 $ 2,584,598 International 81,353 76,722 256,067 263,017 Less intercompany sales (1,416) (3,166) (5,078) (7,042) $ 752,599 $ 885,519 $ 2,513,696 $ 2,840,573 |
Schedule of Reconciliation of Assets from Segment to Consolidated | March 31, 2024 June 30, 2023 (in thousands) Assets: Specialty Technology Solutions $ 892,866 $ 1,104,103 Modern Communications & Cloud 890,122 964,066 Corporate — — $ 1,782,988 $ 2,068,169 Property and equipment, net by Geography Category: United States and Canada $ 22,846 $ 27,323 International 12,748 10,056 $ 35,594 $ 37,379 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Schedule of Assets and Liabilities, Lessee | The following table presents amounts recorded on the Condensed Consolidated Balance Sheets related to operating leases at March 31, 2024 and June 30, 2023: March 31, 2024 June 30, 2023 Operating leases Balance Sheet location (in thousands) Operating lease right-of-use assets Other non-current assets $ 10,342 $ 12,539 Current operating lease liabilities Accrued expenses and other current liabilities $ 3,808 $ 4,355 Long-term operating lease liabilities Other long-term liabilities $ 7,440 $ 9,329 |
Schedule of Lease, Cost | The following table presents amounts recorded in operating lease expense as part of selling general and administrative expenses on the Condensed Consolidated Income Statements during the quarters and nine months ended March 31, 2024 and 2023. Operating lease costs contain immaterial amounts of short-term lease costs for leases with an initial term of 12 months or less. Quarter ended March 31, Nine months ended March 31, 2024 2023 2024 2023 (in thousands) Operating lease cost $ 1,143 $ 1,319 $ 3,786 $ 3,896 Variable lease cost 364 396 1,069 1,158 $ 1,507 $ 1,715 $ 4,855 $ 5,054 Supplemental cash flow information related to the Company's operating leases for the nine months ended March 31, 2024 and 2023 are presented in the table below: Nine months ended March 31, 2024 2023 (in thousands) Cash paid for amounts in the measurement of lease liabilities $ 4,019 $ 4,054 Right-of-use assets obtained in exchange for lease obligations 840 746 The weighted-average remaining lease term and discount rate at March 31, 2024 are presented in the table below: March 31, 2024 Weighted-average remaining lease term 3.2 years Weighted-average discount rate 5.00 % |
Schedule of Lessee, Operating Lease, Liability, Maturity | The following table presents the maturities of the Company's operating lease liabilities at March 31, 2024: Operating leases (in thousands) 2024 $ 1,219 2025 4,169 2026 3,618 2027 3,176 2028 1,118 Thereafter 523 Total future payments 13,823 Less: amounts representing interest 2,575 Present value of lease payments $ 11,248 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Pre-acquisition Contingencies and Corresponding Indemnification Receivables | The table below summarizes the balances and line item presentation of Network1's pre-acquisition contingencies and corresponding indemnification receivables in the Company's Condensed Consolidated Balance Sheets at March 31, 2024 and June 30, 2023: March 31, 2024 June 30, 2023 Network1 (in thousands) Assets Prepaid expenses and other current assets $ 16 $ 16 Other non-current assets $ 4,003 $ 4,150 Liabilities Accrued expenses and other current liabilities $ 16 $ 16 Other long-term liabilities $ 4,003 $ 4,150 |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Severance Costs | The following table presents the restructuring and employee separation costs incurred for the quarter and nine months ended March 31, 2024: Quarter ended March 31, 2024 Nine months ended March 31, 2024 (in thousands) Employee separation and benefit costs $ 3,923 $ 3,923 |
Schedule of Restructuring Activity | The following table represents activity for the nine months ended March 31, 2024: Accrued Expenses (in thousands) Balance at June 30, 2023 $ — Charged to expense 3,923 Cash payments (1,125) Balance at March 31, 2024 $ 2,798 |
Business and Summary of Signi_3
Business and Summary of Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2024 USD ($) segment | Mar. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) | |
Cash and Cash Equivalents [Line Items] | |||||
Number of operating segments | segment | 2 | ||||
Depreciation expense related to selling, general and administrative costs | $ 2,690 | $ 2,644 | $ 8,449 | $ 8,085 | |
Amortization of intangible assets | 3,752 | 4,170 | 11,982 | 12,561 | |
Product | |||||
Cash and Cash Equivalents [Line Items] | |||||
Depreciation expense reported as part of cost of goods sold | 300 | $ 300 | 800 | $ 700 | |
Bank Overdrafts | |||||
Cash and Cash Equivalents [Line Items] | |||||
Outstanding checks | $ 200 | $ 200 | $ 8,000 |
Trade Accounts and Notes Rece_3
Trade Accounts and Notes Receivable, Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning Balance | $ 15,480 | |
Amounts Charged to Expense | 5,863 | $ 1,852 |
Write-offs | (1,975) | |
Other | 198 | |
Ending Balance | $ 19,566 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 752,599 | $ 885,519 | $ 2,513,696 | $ 2,840,573 |
Hardware, software and cloud (excluding Intelisys) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 731,733 | 865,455 | 2,450,872 | 2,781,706 |
Intelisys connectivity and cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 20,866 | 20,064 | 62,824 | 58,867 |
Specialty Technology Solutions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 483,704 | 565,652 | 1,513,926 | 1,769,530 |
Specialty Technology Solutions | Hardware, software and cloud (excluding Intelisys) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 483,704 | 565,652 | 1,513,926 | 1,769,530 |
Specialty Technology Solutions | Intelisys connectivity and cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Modern Communications & Cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 268,895 | 319,867 | 999,770 | 1,071,043 |
Modern Communications & Cloud | Hardware, software and cloud (excluding Intelisys) | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 248,029 | 299,803 | 936,946 | 1,012,176 |
Modern Communications & Cloud | Intelisys connectivity and cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 20,866 | $ 20,064 | $ 62,824 | $ 58,867 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Mar. 31, 2024 | Dec. 31, 2023 | Sep. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | |
Numerator: | ||||||||
Net Income | $ 12,806 | $ 32,726 | $ 15,432 | $ 21,221 | $ 25,734 | $ 24,042 | $ 60,964 | $ 70,997 |
Denominator: | ||||||||
Weighted-average shares, basic (in shares) | 25,025,000 | 25,196,000 | 24,982,000 | 25,228,000 | ||||
Dilutive effect of share-based payments (in shares) | 412,000 | 243,000 | 309,000 | 208,000 | ||||
Weighted-average shares, diluted (in shares) | 25,437,000 | 25,439,000 | 25,291,000 | 25,436,000 | ||||
Net income per common share, basic (in dollars per share) | $ 0.51 | $ 0.84 | $ 2.44 | $ 2.81 | ||||
Net income per common share, diluted (in dollars per share) | $ 0.50 | $ 0.83 | $ 2.41 | $ 2.79 | ||||
Weighted average shares excluded from the computation of diluted earnings per share (in shares) | 164,093 | 779,688 | 755,797 | 1,152,714 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | |
Accumulated Other Comprehensive Loss [Line Items] | ||||||||||
Stockholders' equity attributable to parent | $ 944,051 | $ 878,895 | $ 944,051 | $ 878,895 | $ 953,601 | $ 915,253 | $ 905,298 | $ 862,386 | $ 827,004 | $ 806,528 |
Tax expense (benefit) | 136 | (354) | (555) | 225 | ||||||
Accumulated other comprehensive loss | ||||||||||
Accumulated Other Comprehensive Loss [Line Items] | ||||||||||
Stockholders' equity attributable to parent | (100,017) | $ (99,446) | (100,017) | $ (99,446) | $ (95,218) | $ (96,358) | (89,621) | $ (102,572) | $ (109,976) | $ (104,638) |
Foreign currency translation adjustment | ||||||||||
Accumulated Other Comprehensive Loss [Line Items] | ||||||||||
Stockholders' equity attributable to parent | (102,285) | (102,285) | (93,136) | |||||||
Unrealized gain on hedged transaction, net of tax | ||||||||||
Accumulated Other Comprehensive Loss [Line Items] | ||||||||||
Stockholders' equity attributable to parent | $ 2,268 | $ 2,268 | $ 3,515 |
Goodwill and Other Identifiab_3
Goodwill and Other Identifiable Intangible Assets (Changes in the Carrying Amount of Goodwill) (Details) $ in Thousands | 9 Months Ended |
Mar. 31, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | $ 216,706 |
Goodwill disposed upon business sale | (8,539) |
Foreign currency translation adjustment | (551) |
Balance at March 31, 2024 | 207,616 |
Specialty Technology Solutions | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | 16,370 |
Goodwill disposed upon business sale | 0 |
Foreign currency translation adjustment | 0 |
Balance at March 31, 2024 | 16,370 |
Modern Communications & Cloud | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | 200,336 |
Goodwill disposed upon business sale | (8,539) |
Foreign currency translation adjustment | (551) |
Balance at March 31, 2024 | $ 191,246 |
Goodwill and Other Identifiab_4
Goodwill and Other Identifiable Intangible Assets (Net Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Finite-lived Intangible Assets [Roll Forward] | ||||
Balance at June 30, 2023 | $ 68,495 | |||
Intangibles disposed upon business sale | (14,927) | |||
Amortization expense | $ (3,752) | $ (4,170) | (11,982) | $ (12,561) |
Foreign currency translation adjustment | (76) | |||
Balance at March 31, 2024 | $ 41,510 | $ 41,510 |
Short-Term Borrowings and Lon_3
Short-Term Borrowings and Long-Term Debt (Schedule of Debt) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Debt Instrument [Line Items] | ||
Current portion of long-term debt | $ 7,857 | $ 6,915 |
Long-term debt, net of current portion | 138,024 | 144,006 |
Borrowings under revolving credit facility | 0 | 178,980 |
Total debt | 145,881 | 329,901 |
Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, net of current portion | 135,000 | 140,625 |
Multi-Currency Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Borrowings under revolving credit facility | 0 | 178,980 |
Mississippi Revenue Bond | ||
Debt Instrument [Line Items] | ||
Long-term debt, net of current portion | $ 3,024 | $ 3,381 |
Short-Term Borrowings and Lon_4
Short-Term Borrowings and Long-Term Debt (Narrative) (Details) - USD ($) | 9 Months Ended | ||||
Apr. 01, 2023 | Sep. 28, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | Jun. 30, 2023 | |
Debt Instrument [Line Items] | |||||
Debt issuance costs, net | $ 1,300,000 | ||||
Mississippi Revenue Bond | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0.85% | ||||
Put option, exercisable period limitation (in days) | 180 days | ||||
Percentage of principal due on exercise of put option | 100% | ||||
Long-term debt, percentage bearing variable interest | 6.28% | 6.11% | |||
SOFR | Mississippi Revenue Bond | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0.10% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, expiration period | 5 years | ||||
Borrowing capacity under credit facility | $ 350,000,000 | ||||
Line of credit facility, accordion feature, higher borrowing capacity option | 250,000,000 | ||||
Letters of credit outstanding | $ 0 | $ 0 | |||
Debt issuance costs, gross | $ 1,400,000 | ||||
Amount of unrestricted domestic cash | $ 30,000,000 | ||||
Percentage of spread in effect Interest rate | 1.25% | ||||
Line of credit facility, unused capacity, commitment fee percentage | 0.20% | ||||
Average daily balance on revolving credit facility | $ 94,600,000 | $ 227,200,000 | |||
Line of credit facility, remaining borrowing capacity | $ 350,000,000 | $ 171,000,000 | |||
Effective interest rate | 6.68% | 6.74% | |||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 1% | ||||
Line of credit facility, interest coverage ratio | 3 | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 1.75% | ||||
Line of credit facility, leverage ratio | 3.50 | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | SOFR | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0.10% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | SOFR | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 1% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | SOFR | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 1.75% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | Alternate Base Rate Loans | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0.25% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | Alternate Base Rate Loans | Minimum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0% | ||||
Multi-Currency Revolving Credit Facility, Amended Credit Agreement | Alternate Base Rate Loans | Maximum | |||||
Debt Instrument [Line Items] | |||||
Percentage spread points on variable rate debt instrument | 0.75% | ||||
Term Loan Facility | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, expiration period | 5 years | ||||
Borrowing capacity under credit facility | $ 150,000,000 | ||||
Letter of Credit | |||||
Debt Instrument [Line Items] | |||||
Letters of credit outstanding | $ 50,000,000 |
Derivatives and Hedging Activ_3
Derivatives and Hedging Activities (Narrative) (Details) - USD ($) | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 28, 2022 |
Foreign exchange contracts | ||||
Derivative [Line Items] | ||||
Derivative, notional amount | $ 27,700,000 | $ 34,300,000 | ||
Interest rate swap agreement | ||||
Derivative [Line Items] | ||||
Derivative, notional amount | $ 100,000,000 | |||
Interest Rate Swap, Maturing April 30, 2024 | ||||
Derivative [Line Items] | ||||
Derivative, notional amount | 50,000,000 | |||
Interest Rate Swap, Maturing April 30, 2026 | ||||
Derivative [Line Items] | ||||
Derivative, notional amount | $ 50,000,000 | |||
Interest Rate Swap, Maturing March 31, 2028 | ||||
Derivative [Line Items] | ||||
Derivative, notional amount | $ 25,000,000 |
Derivatives and Hedging Activ_4
Derivatives and Hedging Activities (Derivative Contracts and Changes in Underlying Value of the Foreign Currency Exposures) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | ||||
Net foreign exchange derivative contract (gains) losses | $ (526) | $ 564 | $ 132 | $ 1,873 |
Net foreign currency transactional and re-measurement losses (gains) | 1,034 | (59) | 1,500 | (98) |
Net foreign currency exchange losses | $ 508 | $ 505 | $ 1,632 | $ 1,775 |
Derivatives and Hedging Activ_5
Derivatives and Hedging Activities (Schedule of Cash Flow Hedge Included in Accumulated Other Comprehensive Income (Loss), Net of Income Taxes) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Mar. 31, 2024 | Dec. 31, 2023 | Sep. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Mar. 31, 2024 | Mar. 31, 2023 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||||||
Net increase (decrease) in accumulated other comprehensive income, net of tax | $ 148 | $ (1,547) | $ 153 | $ (1,165) | $ 3 | $ 1,879 | $ (1,246) | $ 718 |
Interest rate swap agreement | ||||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||||
Net interest income recognized as a result of interest rate swap | (895) | (556) | (2,676) | (869) | ||||
Unrealized gain (loss) in fair value of interest rate swap | 1,093 | (1,013) | 1,021 | 1,837 | ||||
Net increase (decrease) in accumulated other comprehensive income | 198 | (1,569) | (1,655) | 968 | ||||
Income tax effect | 50 | (404) | (409) | 250 | ||||
Net increase (decrease) in accumulated other comprehensive income, net of tax | $ 148 | $ (1,165) | $ (1,246) | $ 718 |
Derivatives and Hedging Activ_6
Derivatives and Hedging Activities (Derivative Instruments) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Foreign exchange contracts | Prepaid expenses and other current assets | Fair Value of Derivatives Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 0 | $ 0 |
Foreign exchange contracts | Prepaid expenses and other current assets | Fair Value of Derivatives Not Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0 | 1 |
Foreign exchange contracts | Accrued expenses and other current liabilities | Fair Value of Derivatives Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 0 | 0 |
Foreign exchange contracts | Accrued expenses and other current liabilities | Fair Value of Derivatives Not Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 15 | 0 |
Foreign currency hedge | Prepaid expenses and other current assets | Fair Value of Derivatives Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 27 | 100 |
Foreign currency hedge | Prepaid expenses and other current assets | Fair Value of Derivatives Not Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0 | 0 |
Interest rate swap agreement | Other non-current assets | Fair Value of Derivatives Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 3,032 | 4,687 |
Interest rate swap agreement | Other non-current assets | Fair Value of Derivatives Not Designated as Hedge Instruments | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 0 | $ 0 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Foreign exchange contracts | ||
Assets: | ||
Derivative asset | $ 1 | |
Quoted prices in active markets (Level 1) | Foreign exchange contracts | ||
Assets: | ||
Derivative asset | 0 | |
Significant other observable inputs (Level 2) | Foreign exchange contracts | ||
Assets: | ||
Derivative asset | 1 | |
Fair Value, Recurring | ||
Assets: | ||
Deferred compensation plan investments, current and non-current portion | $ 30,995 | 28,209 |
Total assets at fair value | 34,054 | 32,997 |
Liabilities: | ||
Deferred compensation plan investments, current and non-current portion | 31,005 | 28,229 |
Total liabilities at fair value | 31,020 | 28,229 |
Fair Value, Recurring | Foreign exchange contracts | ||
Liabilities: | ||
Forward foreign currency exchange contracts | 15 | |
Fair Value, Recurring | Interest rate swap agreement | ||
Assets: | ||
Derivative asset | 3,032 | 4,687 |
Fair Value, Recurring | Foreign currency hedge | ||
Assets: | ||
Derivative asset | 27 | 100 |
Fair Value, Recurring | Quoted prices in active markets (Level 1) | ||
Assets: | ||
Deferred compensation plan investments, current and non-current portion | 30,995 | 28,209 |
Total assets at fair value | 30,995 | 28,209 |
Liabilities: | ||
Deferred compensation plan investments, current and non-current portion | 31,005 | 28,229 |
Total liabilities at fair value | 31,005 | 28,229 |
Fair Value, Recurring | Quoted prices in active markets (Level 1) | Foreign exchange contracts | ||
Liabilities: | ||
Forward foreign currency exchange contracts | 0 | |
Fair Value, Recurring | Quoted prices in active markets (Level 1) | Interest rate swap agreement | ||
Assets: | ||
Derivative asset | 0 | 0 |
Fair Value, Recurring | Quoted prices in active markets (Level 1) | Foreign currency hedge | ||
Assets: | ||
Derivative asset | 0 | 0 |
Fair Value, Recurring | Significant other observable inputs (Level 2) | ||
Assets: | ||
Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Total assets at fair value | 3,059 | 4,788 |
Liabilities: | ||
Deferred compensation plan investments, current and non-current portion | 0 | 0 |
Total liabilities at fair value | 15 | 0 |
Fair Value, Recurring | Significant other observable inputs (Level 2) | Foreign exchange contracts | ||
Liabilities: | ||
Forward foreign currency exchange contracts | 15 | |
Fair Value, Recurring | Significant other observable inputs (Level 2) | Interest rate swap agreement | ||
Assets: | ||
Derivative asset | 3,032 | 4,687 |
Fair Value, Recurring | Significant other observable inputs (Level 2) | Foreign currency hedge | ||
Assets: | ||
Derivative asset | $ 27 | $ 100 |
Segment Information (Narrative)
Segment Information (Narrative) (Details) | 9 Months Ended |
Mar. 31, 2024 segment | |
Segment Reporting, Measurement Disclosures [Abstract] | |
Number of reportable segments | 2 |
Segment Information (Financial
Segment Information (Financial Information by Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Segment Reporting Information [Line Items] | ||||
Sales | $ 752,599 | $ 885,519 | $ 2,513,696 | $ 2,840,573 |
Depreciation and amortization | 6,742 | 7,074 | 21,217 | 21,359 |
Operating income (loss) | 17,542 | 34,279 | 68,454 | 108,598 |
Capital expenditures | (2,420) | (2,286) | (7,285) | (6,549) |
Specialty Technology Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 483,704 | 565,652 | 1,513,926 | 1,769,530 |
Modern Communications & Cloud | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 268,895 | 319,867 | 999,770 | 1,071,043 |
Operating Segments | Specialty Technology Solutions | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 483,704 | 565,652 | 1,513,926 | 1,769,530 |
Depreciation and amortization | 2,736 | 2,638 | 8,390 | 8,099 |
Operating income (loss) | 9,080 | 19,811 | 34,321 | 61,345 |
Capital expenditures | (567) | (520) | (2,133) | (1,546) |
Operating Segments | Modern Communications & Cloud | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 268,895 | 319,867 | 999,770 | 1,071,043 |
Depreciation and amortization | 3,287 | 3,717 | 10,621 | 11,102 |
Operating income (loss) | 12,989 | 14,468 | 40,004 | 47,253 |
Capital expenditures | (1,853) | (1,766) | (5,152) | (5,003) |
Corporate | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization | 719 | 719 | 2,206 | 2,158 |
Operating income (loss) | (4,527) | 0 | (5,871) | 0 |
Reportable Geographical Components | United States and Canada | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 672,662 | 811,963 | 2,262,707 | 2,584,598 |
Reportable Geographical Components | International | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 81,353 | 76,722 | 256,067 | 263,017 |
Geography Eliminations | ||||
Segment Reporting Information [Line Items] | ||||
Sales | $ (1,416) | $ (3,166) | $ (5,078) | $ (7,042) |
Segment Information (Assets By
Segment Information (Assets By Segment) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Segment Reporting Information [Line Items] | ||
Assets | $ 1,782,988 | $ 2,068,169 |
Property and equipment, net by Geography Category | 35,594 | 37,379 |
United States and Canada | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net by Geography Category | 22,846 | 27,323 |
International | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net by Geography Category | 12,748 | 10,056 |
Continuing Operations | Corporate | ||
Segment Reporting Information [Line Items] | ||
Assets | 0 | 0 |
Continuing Operations | Specialty Technology Solutions | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Assets | 892,866 | 1,104,103 |
Continuing Operations | Modern Communications & Cloud | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 890,122 | $ 964,066 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | Mar. 31, 2024 |
Lessee, Lease, Description [Line Items] | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property and equipment, net |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses and other current liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long-term liabilities |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 10 years |
Leases (Supplemental Balance Sh
Leases (Supplemental Balance Sheet Information) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 10,342 | $ 12,539 |
Current operating lease liabilities | 3,808 | 4,355 |
Long-term operating lease liabilities | $ 7,440 | $ 9,329 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other non-current assets | Other non-current assets |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other long-term liabilities | Other long-term liabilities |
Leases (Schedule of Lease Cost)
Leases (Schedule of Lease Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||||
Operating lease cost | $ 1,143 | $ 1,319 | $ 3,786 | $ 3,896 |
Variable lease cost | 364 | 396 | 1,069 | 1,158 |
Total cost | $ 1,507 | $ 1,715 | $ 4,855 | $ 5,054 |
Leases (Supplemental Cash Flow
Leases (Supplemental Cash Flow Information) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||
Cash paid for amounts in the measurement of lease liabilities | $ 4,019 | $ 4,054 |
Right-of-use assets obtained in exchange for lease obligations | $ 840 | $ 746 |
Leases (Weighted Average Remain
Leases (Weighted Average Remaining Term and Discount Rate) (Details) | Mar. 31, 2024 |
Leases [Abstract] | |
Weighted-average remaining lease term (in years) | 3 years 2 months 12 days |
Weighted-average discount rate | 5% |
Leases (Maturities of Operating
Leases (Maturities of Operating Lease Liabilities) (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Leases [Abstract] | |
2024 | $ 1,219 |
2025 | 4,169 |
2026 | 3,618 |
2027 | 3,176 |
2028 | 1,118 |
Thereafter | 523 |
Total future payments | 13,823 |
Less: amounts representing interest | 2,575 |
Present value of lease payments | $ 11,248 |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Jun. 30, 2023 |
Network1 | ||
Other Commitments [Line Items] | ||
Cash held in escrow | $ 3.6 | $ 3.4 |
Commitments and Contingencies_3
Commitments and Contingencies (Schedule of Pre-acquisition Contingencies and Corresponding Indemnification Receivables) (Details) - Network1 - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Assets | ||
Prepaid expenses and other current assets | $ 16 | $ 16 |
Other non-current assets | 4,003 | 4,150 |
Liabilities | ||
Accrued expenses and other current liabilities | 16 | 16 |
Other long-term liabilities | $ 4,003 | $ 4,150 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |||||
Discrete net tax benefit | $ 1.5 | ||||
Effective income tax rate | 28.70% | 29.10% | 21% | 27.80% | |
Unrecognized tax benefits | $ 1.2 | $ 1.2 | $ 1.2 | ||
Unrecognized tax benefits that would impact effective tax rate if recognized | 1 | 1 | |||
Income tax penalties and interest accrued | $ 1.2 | $ 1.2 | $ 1.2 |
Business Sale (Details)
Business Sale (Details) - Discontinued Operations, Held-for-sale or Disposed of by Sale - UK-based intY Business $ in Millions | Dec. 19, 2023 USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Cash payment received | $ 18 |
Gain (loss) on disposal group | $ 14.5 |
Restructuring - Additional Info
Restructuring - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Jan. 31, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |||
Expected annual savings | $ 10,000 | ||
Restructuring reserve | $ 2,798 | $ 0 |
Restructuring - Summary of Rest
Restructuring - Summary of Restructuring and Severance Costs, By Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||||
Employee separation and benefit costs | $ 3,923 | $ 0 | $ 3,923 | $ 0 |
Employee separation and benefit costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Employee separation and benefit costs | $ 3,923 | $ 3,923 |
Restructuring - Restructuring A
Restructuring - Restructuring Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Reserve [Roll Forward] | ||||
Balance, beginning of year | $ 0 | |||
Employee separation and benefit costs | $ 3,923 | $ 0 | 3,923 | $ 0 |
Cash payments | (1,125) | |||
Ending Balance | $ 2,798 | $ 2,798 |