Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Mar. 09, 2015 | Jun. 30, 2014 |
Document and Entity Information | |||
Entity Registrant Name | PCM, INC. | ||
Entity Central Index Key | 937941 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $103.90 | ||
Entity Common Stock, Shares Outstanding | 12,246,323 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $8,892 | $9,992 |
Accounts receivable, net of allowances of $426 and $1407 | 199,604 | 195,749 |
Inventories | 50,687 | 111,444 |
Prepaid expenses and other current assets | 15,936 | 14,893 |
Deferred income taxes | 3,922 | 2,583 |
Current assets of discontinued operations | 26 | 5,846 |
Total current assets | 279,067 | 340,507 |
Property and equipment, net | 74,368 | 55,793 |
Deferred income taxes | 225 | |
Goodwill | 25,510 | 25,510 |
Intangible assets, net | 4,673 | 4,684 |
Other assets | 5,558 | 6,804 |
Non-current assets of discontinued operations | 14 | 1,299 |
Total assets | 389,190 | 434,822 |
Current liabilities: | ||
Accounts payable | 122,333 | 130,810 |
Accrued expenses and other current liabilities | 26,107 | 30,296 |
Deferred revenue | 10,089 | 9,427 |
Line of credit | 52,795 | 110,499 |
Notes payable - current | 3,741 | 1,167 |
Current liabilities of discontinued operations | 577 | 713 |
Total current liabilities | 215,642 | 282,912 |
Notes payable and other long-term liabilities | 28,015 | 18,247 |
Deferred income taxes | 12,217 | 7,901 |
Total liabilities | 255,874 | 309,060 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 5,000,000 shares authorized; none issued and outstanding | ||
Common stock, $0.001 par value; 30,000,000 shares authorized; 15,758,714 and 15,053,067 shares issued; and 12,267,550 and 11,790,674 shares outstanding | 16 | 15 |
Additional paid-in capital | 120,915 | 115,801 |
Treasury stock, at cost: 3,491,164 and 3,262,393 shares | -17,472 | -15,321 |
Accumulated other comprehensive income | 941 | 1,816 |
Retained earnings | 28,916 | 23,451 |
Total stockholders' equity | 133,316 | 125,762 |
Total liabilities and stockholders' equity | $389,190 | $434,822 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowances (in dollars) | $426 | $1,407 |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 15,758,714 | 15,053,067 |
Common stock, shares outstanding | 12,267,550 | 11,790,674 |
Treasury stock, shares | 3,491,164 | 3,262,393 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF OPERATIONS | |||
Net sales | $1,356,362 | $1,359,999 | $1,342,298 |
Cost of goods sold | 1,164,295 | 1,170,500 | 1,158,168 |
Gross profit | 192,067 | 189,499 | 184,130 |
Selling, general and administrative expenses | 176,362 | 171,279 | 170,119 |
Revaluation of earnout liability | -107 | ||
Other charge | 500 | ||
Operating profit | 15,705 | 18,220 | 13,618 |
Interest expense, net | 3,180 | 3,340 | 3,791 |
Income from continuing operations before income taxes | 12,525 | 14,880 | 9,827 |
Income tax expense | 5,490 | 6,235 | 4,134 |
Income from continuing operations | 7,035 | 8,645 | 5,693 |
Loss from discontinued operations, net of taxes | -1,570 | -516 | -599 |
Net income | $5,465 | $8,129 | $5,094 |
Basic EPS: | |||
Income from continuing operations (in dollars per share) | $0.57 | $0.75 | $0.47 |
Loss from discontinued operations, net of taxes (in dollars per share) | ($0.12) | ($0.05) | ($0.05) |
Basic (in dollars per share) | $0.45 | $0.70 | $0.42 |
Diluted EPS: | |||
Income from continuing operations (in dollars per share) | $0.55 | $0.73 | $0.47 |
Loss from discontinued operations, net of taxes (in dollars per share) | ($0.13) | ($0.05) | ($0.05) |
Diluted (in dollars per share) | $0.42 | $0.68 | $0.42 |
Weighted average number of common shares outstanding: | |||
Basic (in shares) | 12,251 | 11,583 | 11,989 |
Diluted (in shares) | 12,881 | 11,923 | 12,160 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $5,465 | $8,129 | $5,094 |
Other comprehensive income (loss): | |||
Foreign currency translation adjustments | -875 | -695 | 255 |
Total other comprehensive income (loss) | -875 | -695 | 255 |
Comprehensive income | $4,590 | $7,434 | $5,349 |
CONSOLIDATED_STATEMENTS_OF_STO
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (USD $) | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Other Comprehensive Income | Retained Earnings (Deficit) | Total |
In Thousands, except Share data, unless otherwise specified | ||||||
Balance at Dec. 31, 2011 | $14 | $108,061 | ($9,733) | $2,256 | $10,228 | $110,826 |
Balance (in shares) at Dec. 31, 2011 | 11,996,000 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock option exercises and related income tax benefit | 1,991 | -45 | 1,946 | |||
Stock option exercises and related income tax benefit (in shares) | 183,000 | |||||
Stock-based compensation expense | 1,900 | 1,900 | ||||
Purchases of common stock under a stock repurchase program | -3,910 | -3,910 | ||||
Purchases of common stock under a stock repurchase program (in shares) | -654,000 | |||||
Net income | 5,094 | 5,094 | ||||
Other comprehensive income (loss) | 255 | 255 | ||||
Balance at Dec. 31, 2012 | 14 | 111,952 | -13,688 | 2,511 | 15,322 | 116,111 |
Balance (in shares) at Dec. 31, 2012 | 11,525,000 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock option exercises and related income tax benefit | 1 | 2,332 | 2,333 | |||
Stock option exercises and related income tax benefit (in shares) | 493,000 | |||||
Stock-based compensation expense | 1,517 | 1,517 | ||||
Purchases of common stock under a stock repurchase program | -1,633 | -1,633 | ||||
Purchases of common stock under a stock repurchase program (in shares) | -227,000 | |||||
Net income | 8,129 | 8,129 | ||||
Other comprehensive income (loss) | -695 | -695 | ||||
Balance at Dec. 31, 2013 | 15 | 115,801 | -15,321 | 1,816 | 23,451 | 125,762 |
Balance (in shares) at Dec. 31, 2013 | 11,791,000 | 11,790,674 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Stock option exercises and related income tax benefit | 1 | 3,612 | 3,613 | |||
Stock option exercises and related income tax benefit (in shares) | 706,000 | |||||
Stock-based compensation expense | 1,502 | 1,502 | ||||
Purchases of common stock under a stock repurchase program | -2,151 | -2,151 | ||||
Purchases of common stock under a stock repurchase program (in shares) | -229,000 | -228,771 | ||||
Net income | 5,465 | 5,465 | ||||
Other comprehensive income (loss) | -875 | -875 | ||||
Balance at Dec. 31, 2014 | $16 | $120,915 | ($17,472) | $941 | $28,916 | $133,316 |
Balance (in shares) at Dec. 31, 2014 | 12,268,000 | 12,267,550 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash Flows From Operating Activities | |||
Net income | $5,465 | $8,129 | $5,094 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 11,893 | 11,830 | 12,496 |
Provision for deferred income taxes | 2,987 | 1,539 | 2,565 |
Net tax benefit related to stock option exercises | 1,387 | ||
Excess tax benefit related to stock option exercises | -293 | -291 | -193 |
Non-cash stock-based compensation | 1,502 | 1,517 | 1,900 |
Decrease in earnout liability | -1,100 | ||
Change in operating assets and liabilities: | |||
Accounts receivable | -3,545 | -5,999 | 1,584 |
Inventories | 66,267 | -48,019 | 10,514 |
Prepaid expenses and other current assets | -1,334 | -1,119 | -4,037 |
Other assets | 855 | -3,913 | 315 |
Accounts payable | -8,576 | 31,042 | -17,649 |
Accrued expenses and other current liabilities | -2,593 | 2,161 | -1,370 |
Deferred revenue | 636 | 4,045 | 2,068 |
Total adjustments | 67,799 | -7,207 | 8,480 |
Net cash provided by operating activities | 73,264 | 922 | 13,574 |
Cash Flows From Investing Activities | |||
Purchases of property and equipment | -26,666 | -17,213 | -9,446 |
Net cash used in investing activities | -26,666 | -17,213 | -9,446 |
Cash Flows From Financing Activities | |||
Net (payments) borrowings under line of credit | -57,704 | 22,869 | -4,222 |
Capital lease proceeds | 206 | 4,356 | |
Borrowing under note payable | 13,734 | 4,599 | 2,859 |
Payments under notes payable | -2,487 | -1,461 | -1,087 |
Change in book overdraft | -98 | -3,034 | -2,640 |
Payment of earnout liability | -993 | ||
Payments of obligations under capital lease | -2,625 | -2,932 | -2,440 |
Proceeds from stock issued under stock option plans | 3,887 | 2,362 | 604 |
Payment for deferred financing costs | -30 | -1,163 | |
Excess tax benefit related to stock option exercises | 293 | 291 | 193 |
Common shares repurchased and held in treasury | -2,151 | -1,633 | -3,910 |
Net cash (used in) provided by financing activities | -47,181 | 20,104 | -7,280 |
Effect of foreign currency on cash flow | -517 | -356 | 203 |
Net change in cash and cash equivalents | -1,100 | 3,457 | -2,949 |
Cash and cash equivalents at beginning of the period | 9,992 | 6,535 | 9,484 |
Cash and cash equivalents at end of the period | 8,892 | 9,992 | 6,535 |
Supplemental Cash Flow Information | |||
Interest paid | 3,353 | 3,228 | 3,305 |
Income taxes paid | 6,213 | 2,974 | 2,470 |
Supplemental Non-Cash Investing Activities | |||
Financed purchase of property and equipment | $2,332 | $1,106 | $1,988 |
Description_of_Company
Description of Company | 12 Months Ended |
Dec. 31, 2014 | |
Description of Company | |
Description of Company | |
1. Description of Company | |
PCM, Inc. is a leading multi-vendor provider of technology products, services and solutions offered through our dedicated sales force and field service teams and direct marketing channels. Since our founding in 1987, we have served our customers by offering products and services from vendors such as Apple, Cisco, Dell, HP, Ingram Micro, Lenovo, Microsoft and Tech Data. We add additional value by incorporating products and services into comprehensive solutions. Our sales and marketing efforts allow our vendor partners to reach multiple customer segments including small, medium and enterprise businesses, state, local and federal governments, educational institutions and individual consumers. | |
We operate under three reportable operating segments - Commercial, Public Sector and MacMall. Our segments are primarily aligned based upon their respective customer base. Prior to 2013, we had four reportable operating segments: MME, SMB, Public Sector and MacMall/OnSale, which were reorganized in connection with our rebranding strategy. We include corporate related expenses such as legal, accounting, information technology, product management and other administrative costs that are not otherwise included in our reportable operating segments in Corporate & Other. | |
During 2014, we discontinued the operation of all four of our retail stores, located in Huntington Beach, Santa Monica and Torrance, California and Chicago, Illinois, and our OnSale and eCost businesses. We reflected the results of these operations, which were historically reported as a part of our MacMall segment, as discontinued operations for all periods presented herein in our Consolidated Balance Sheets and Consolidated Statements of Operations. See Note 6 below for more information. | |
We sell primarily to customers in the United States, and maintain offices throughout the United States, as well as in Montreal, Canada and Manila, Philippines. In 2014, we generated approximately 75% of our revenue in our Commercial segment, 16% of our revenue in our Public Sector segment and 9% of our revenue in our MacMall segment. | |
Our Commercial segment sells complex products, services and solutions to commercial businesses in the United States, using multiple sales channels, including a field relationship-based selling model, an outbound phone based sales force, a field services organization and an online extranet. | |
Our Public Sector segment consists of sales made primarily to federal, state and local governments, as well as educational institutions. The Public Sector segment utilizes an outbound phone and field relationship-based selling model, as well as contract and bid business development teams and an online extranet. | |
Our MacMall segment consists of sales made via telephone and the Internet to consumers, small businesses and creative professionals. | |
Basis_of_Presentation_and_Summ
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Basis of Presentation and Summary of Significant Accounting Policies | ||||||||
Basis of Presentation and Summary of Significant Accounting Policies | ||||||||
2. Basis of Presentation and Summary of Significant Accounting Policies | ||||||||
We have restated the Consolidated Statement of Cash Flows for the year ended December 31, 2013 to increase purchases of property and equipment and borrowing under a note payable by $1.7 million and decrease non-cash purchases of property and equipment by $1.7 million to correct an immaterial error from netting these amounts. | ||||||||
Principles of Consolidation | ||||||||
The accompanying financial statements included herein are presented on a consolidated basis and include our accounts and the accounts of all of our wholly-owned subsidiaries after elimination of intercompany accounts and transactions. | ||||||||
Use of Estimates in the Preparation of the Consolidated Financial Statements | ||||||||
We prepare our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, which requires management to make estimates, judgments and assumptions that affect the amounts reported herein. Management bases its estimates, judgments and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods could differ from those estimates. | ||||||||
Revenue Recognition | ||||||||
We adhere to the guidelines and principles of sales recognition described in ASC 605 — Revenue Recognition. Under ASC 605, product sales are recognized when the title and risk of loss are passed to the customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectability is reasonably assured. Under these guidelines, the majority of our sales, including revenue from product sales and gross outbound shipping and handling charges, are recognized upon receipt of the product by the customer. In accordance with our revenue recognition policy, we perform an analysis to estimate the number of days products we have shipped are in transit to our customers using data from our third party carriers and other factors. We record an adjustment to reverse the impact of sale transactions based on the estimated value of products that have shipped, but have not yet been received by our customers, and we recognize such amounts in the subsequent period when delivery has occurred. Changes in delivery patterns or unforeseen shipping delays beyond our control could have a material impact on our revenue recognition for the current period. | ||||||||
For all product sales shipped directly from suppliers to customers, we take title to the products sold upon shipment, bear credit risk, and bear inventory risk for returned products that are not successfully returned to suppliers; therefore, these revenues are recognized at gross sales amounts. | ||||||||
We also sell certain products for which we act as an agent in accordance with ASC 605-45. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) or subscriptions. SA is an “insurance” or “maintenance” product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. | ||||||||
Some of our larger customers are offered the opportunity by certain of our vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, our vendors will transfer the license and invoice the customer directly, paying us an agency fee or commission on these sales. We record these fees as a component of net sales as earned and there is no corresponding cost of sales amount. In certain instances, we invoice the customer directly under an EA and accounts for the individual items sold based on the nature of the item. Our vendors typically dictate how the EA will be sold to the customer. | ||||||||
When a customer order contains multiple deliverables such as hardware, software and services which are delivered at varying times, we determine whether the delivered items can be considered separate units of accounting as prescribed under ASC 605-25, Revenue Recognition, Multiple-Element Arrangement. For arrangements with multiple units of accounting, arrangement consideration is allocated among the units of accounting, where separable, based on their relative selling price. Relative selling price is determined based on vendor-specific objective evidence, if it exists. Otherwise, third-party evidence of selling price is used, when it is available, and in circumstances when neither vendor-specific objective evidence nor third-party evidence of selling price is available, management’s best estimate of selling price is used. | ||||||||
Revenue from professional services is either recognized as incurred for services billed at an hourly rate or recognized using the proportional performance method for services provided at a fixed fee. Revenue for data center services, including internet connectivity, web hosting, server co-location and managed services, is recognized over the period the service is performed. | ||||||||
Sales are reported net of estimated returns and allowances, discounts, mail-in rebate redemptions and credit card chargebacks. If the actual sales returns, allowances, discounts, mail-in rebate redemptions or credit card chargebacks are greater than estimated by management, additional expense may be incurred. | ||||||||
Cost of Goods Sold | ||||||||
Cost of goods sold includes product costs, outbound and inbound shipping costs and costs of delivered services, offset by certain market development funds, volume incentive rebates and other consideration from vendors. | ||||||||
We receive vendor consideration from our vendors in the form of cooperative marketing allowances, volume incentive rebates and other programs to support our marketing of their products. Most of our vendor consideration is accrued, when performance required for recognition is completed, as an offset to cost of sales in accordance with ASC 605-50, Revenue Recognition — Customer Payments and Incentives, since such funds are not a reimbursement of specific, incremental, identifiable costs incurred by us in selling the vendors’ products. For costs that are considered to be a reimbursement of specific, incremental, identifiable costs incurred by us in selling the vendors’ products, we accrue the vendor consideration as an offset to such costs in selling, general and administrative expenses. At the end of any given period, unbilled receivables related to our vendor consideration are included in “Accounts receivable, net of allowances” in our Consolidated Balance Sheets. | ||||||||
Cash and Cash Equivalents | ||||||||
All highly liquid investments with initial maturities of three months or less and credit card receivables with settlement terms less than 5 days are considered cash equivalents. Amounts due from credit card processors classified as cash totaled $2.7 million and $2.5 million at December 31, 2014 and 2013. Checks issued but not presented for payment to the bank, net of available cash subject to a right of offset, totaling $1.9 million and $2.0 million as of December 31, 2014 and 2013 were included in “Accounts payable” in our Consolidated Balance Sheets. Our cash management programs result in utilizing available cash to pay down our line of credit. | ||||||||
Accounts Receivable | ||||||||
We generate the majority of our accounts receivable through the sale of products and services to certain customers on account. In addition, we record vendor receivables at such time as all conditions have been met that would entitle us to receive such vendor funding, and is thereby considered fully earned. | ||||||||
The following table presents the gross amounts of our accounts receivable (in thousands): | ||||||||
At December 31, | ||||||||
2014 | 2013 | |||||||
Trade receivables | $ | 170,137 | $ | 164,594 | ||||
Vendor receivables | 24,563 | 30,241 | ||||||
Other receivables | 5,330 | 2,321 | ||||||
Total gross accounts receivable | 200,030 | 197,156 | ||||||
Less: Allowance for doubtful accounts receivable | (426 | ) | (1,407 | ) | ||||
Accounts receivable, net | $ | 199,604 | $ | 195,749 | ||||
For the years ended December 31, 2014 and 2013, “Vendor receivables” presented above included $13.7 million and $15.2 million, respectively, of unbilled receivables relating to vendor consideration, which is described above under “Cost of Goods Sold.” | ||||||||
Accounts receivable potentially subject us to credit risk. We extend credit to our customers based upon an evaluation of each customer’s financial condition and credit history, and generally do not require collateral. No customer accounted for more than 10% of trade accounts receivable at December 31, 2014 and 2013. We maintain an allowance for doubtful accounts receivable based upon estimates of future collection. We regularly evaluate our customers’ financial condition and credit history in determining the adequacy of our allowance for doubtful accounts. We have historically incurred credit losses within management’s expectations. We also maintain an allowance for uncollectible vendor receivables, which arise from vendor rebate programs, price protections and other promotions. We determine the sufficiency of the vendor receivable allowance based upon various factors, including payment history. Amounts received from vendors may vary from amounts recorded because of potential non-compliance with certain elements of vendor programs. If the estimated allowance for uncollectible accounts or vendor receivables subsequently proves to be insufficient, additional allowance may be required. | ||||||||
Inventories | ||||||||
Inventories consist primarily of finished goods, and are stated at the lower of cost (determined under the first-in, first-out method) or market. As discussed under “Revenue Recognition” above, we do not record revenue and related cost of goods sold until there is persuasive evidence of an arrangement for sale, delivery has occurred, the sales price is fixed and determinable and collectability is reasonably assured. As such, inventories include goods-in-transit to customers at December 31, 2014 and 2013. | ||||||||
A substantial portion of our business is dependent on sales of Apple, HP, and products purchased from other vendors including Cisco, Dell, Ingram Micro, Lenovo, Microsoft and Tech Data. Products manufactured by HP represented 18%, 21% and 21% of our net sales in 2014, 2013 and 2012. Products manufactured by Apple represented approximately 15%, 17% and 18% of our net sales in 2014, 2013 and 2012. | ||||||||
Advertising Costs | ||||||||
Our advertising expenditures are expensed in the period incurred. Total net advertising expenditures, which were included in “Selling, general and administrative expenses” in our Consolidated Statements of Operations, were $4.3 million, $4.6 million and $4.0 million in the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
Property and Equipment | ||||||||
Property and equipment are stated at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as noted below. Leasehold improvements are amortized over the shorter of their useful lives or the remaining lease term. We also capitalize computer software costs that meet both the definition of internal-use software and defined criteria for capitalization in accordance with ASC 350-40, Internal-Use Software. | ||||||||
Autos | 3 – 5 years | |||||||
Computers, software, machinery and equipment | 1 – 7 years | |||||||
Leasehold improvements | 1 – 10 years | |||||||
Furniture and fixtures | 3 – 15 years | |||||||
Building and improvements | 5 – 31 years | |||||||
We had $14.4 million and $13.1 million of unamortized internally developed software at December 31, 2014 and 2013, respectively. | ||||||||
Disclosures About Fair Value of Financial Instruments | ||||||||
The carrying amounts of our cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and other current liabilities approximate their fair values because of the short-term maturity of these instruments. The carrying amounts of our line of credit borrowings and notes payable approximate their fair values based upon the current rates offered to us for obligations of similar terms and remaining maturities. | ||||||||
Goodwill and Intangible Assets | ||||||||
Goodwill and indefinite-lived intangible assets are carried at historical cost, subject to write-down, as needed, based upon an impairment analysis that we perform annually, or sooner if an event occurs or circumstances change that would more likely than not result in an impairment loss. We perform our annual impairment test for goodwill and indefinite-lived intangible assets as of October 1 of each year. | ||||||||
Goodwill impairment is deemed to exist if the net book value of a reporting unit exceeds its estimated fair value. Events that may create an impairment include, but are not limited to, significant and sustained decline in our stock price or market capitalization, significant underperformance of operating units and significant changes in market conditions. Changes in estimates of future cash flows or changes in market values could result in a write-down of our goodwill in a future period. If an impairment loss results from any impairment analysis as described above, such loss will be recorded as a pre-tax charge to our operating income. Goodwill is allocated to various reporting units, which are generally an operating segment or one level below the operating segment. Our Commercial operating segment consists of the following reporting units: Abreon and Commercial without Abreon. | ||||||||
Goodwill impairment testing is a two-step process. Step one involves comparing the fair value of our reporting units to their carrying amount. If the fair value of the reporting unit is greater than its carrying amount, there is no impairment and no further testing is required. If the reporting unit’s carrying amount is greater than the fair value, the second step must be completed to measure the amount of impairment, if any. Step two calculates the implied fair value of goodwill by deducting the fair value of all tangible and intangible assets, excluding goodwill, of the reporting unit from the fair value of the reporting unit as determined in step one. The implied fair value of goodwill determined in this step is compared to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, an impairment loss is recognized equal to the difference. | ||||||||
We performed our annual impairment analysis of goodwill and indefinite-lived intangible assets for possible impairment as of October 1, 2014. Our management, with the assistance of an independent third-party valuation firm, determined the fair values of our reporting units and their underlying assets, and compared them to their respective carrying values. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. The carrying value of goodwill was allocated to our reporting units pursuant to ASC 350. As a result of our annual impairment analysis as of October 1, 2014, we have determined that no impairment of goodwill and other indefinite-lived intangible assets existed. | ||||||||
Fair value was determined by using a weighted combination of a market-based approach and an income approach, as this combination was deemed to be the most indicative of fair value in an orderly transaction between market participants. Under the market-based approach, we utilized information regarding our company and publicly available comparable company and industry information to determine cash flow multiples and revenue multiples that are used to value our reporting units. Under the income approach, we determined fair value based on estimated future cash flows of each reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. | ||||||||
In addition, fair value of our indefinite-lived trademark was determined using the relief from royalty method under the income approach to value. This method applies a market based royalty rate to projected revenues that are associated with the trademarks. Applying the royalty rate to projected revenues resulted in an indication of the pre-tax royalty savings associated with ownership of the trademarks. Projected after-tax royalty savings were discounted to present value at the reporting unit’s weighted average cost of capital, and a tax amortization benefit (calculated based on a 15 year life for tax purposes) was added. | ||||||||
In conjunction with our annual assessment of goodwill, our valuation techniques did not indicate any impairment as of October 1, 2014. All reporting units with goodwill passed the first step of the goodwill evaluation, with the fair values of our Abreon and Commercial without Abreon reporting units exceeding their respective carrying values by 70% and 41% and, accordingly, we were not required to perform the second step of the goodwill evaluation. There is $7.2 million and $18.3 million of goodwill residing in our Abreon and Commercial without Abreon reporting units, respectively. In applying the market and income approaches to determining fair value of our reporting units, we rely on a number of significant assumptions and estimates including revenue growth rates and operating margins, discount rates and future market conditions, among others. Our estimates are based upon assumptions we believe to be reasonable, but which by nature are uncertain and unpredictable. Changes in one or more of these significant estimates or assumptions could affect the results of these impairment reviews. | ||||||||
As part of our annual review for impairment, we assessed the total fair values of the reporting units and compared total fair value to our market capitalization at October 1, 2014, including the implied control premium, to determine if the fair values are reasonable compared to external market indicators. When comparing our market capitalization to the discounted cash flow models for each reporting unit summed together, the implied control premium was approximately 27% as of October 1, 2014. We believe several factors are contributing to our low market capitalization, including the lack of trading volume in our stock and the recent significant investments made in various parts of our business and their effects on analyst earnings models. | ||||||||
Given continuing economic uncertainties and related risks to our business, there can be no assurance that our estimates and assumptions made for purposes of our goodwill and indefinite-lived intangible assets impairment testing as of October 1, 2014 will prove to be accurate predictions of the future. We may be required to record additional goodwill impairment charges in future periods, whether in connection with our next annual impairment testing as of October 1, 2015 or prior to that, if any change constitutes a triggering event outside of the quarter from when the annual goodwill and indefinite-lived intangible assets impairment test is performed. It is not possible at this time to determine if any such future impairment charge would result or, if it does, whether such charge would be material. | ||||||||
We amortize other intangible assets with definite lives generally on a straight-line basis over their estimated useful lives. | ||||||||
Valuation of Long-Lived Assets | ||||||||
We review long-lived assets and certain intangible assets for impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In the event the undiscounted future cash flow attributable to the asset is less than the carrying amount of the asset, an impairment loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Changes in estimates of future cash flows attributable to the long-lived assets could result in a write-down of the asset in a future period. | ||||||||
Debt Issuance Costs | ||||||||
We defer costs incurred to obtain our credit facility and amortize these costs to interest expense using the straight-line method over the term of the respective obligation. | ||||||||
Income Taxes | ||||||||
We account for income taxes under the assets and liability method as prescribed in accordance with ASC 740 — Income Taxes. Under this method, deferred tax assets and liabilities are recognized by applying enacted statutory tax rates applicable to future years to differences between the tax basis and financial reporting amounts of existing assets and liabilities. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We make certain estimates and judgments in determining income tax provisions and benefits, in assessing the likelihood of recovering our deferred tax assets and in evaluating our tax positions. A valuation allowance is provided when it is more likely than not that all or some portion of deferred tax assets will not be realized. In making such a determination, all available positive and negative evidence is considered, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. | ||||||||
We account for uncertainty in income taxes recognized in financial statements in accordance with ASC 740, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Only tax positions that meet the more-likely-than-not recognition threshold may be recognized. We have elected to classify interest and penalties related to income tax liabilities, when applicable, as part of “Interest expense, net” in our Consolidated Statements of Operations. | ||||||||
Sales Taxes | ||||||||
We present sales tax we collect from our customers on a net basis (excluded from our revenues), a presentation which is prescribed as one of two methods available under ASC 605-45-50-3 (Taxes Collected from Customers and Remitted to Governmental Authorities). | ||||||||
Stock-Based Compensation | ||||||||
We account for stock-based compensation in accordance with ASC 718 — Compensation — Stock Compensation. ASC 718 addresses the accounting for share-based payment transactions in which an enterprise receives employee services in exchange for either equity instruments of the enterprise or liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments. We record compensation expense related to stock-based compensation over the award’s requisite service period on a straight-line basis. | ||||||||
We estimate the grant date fair value of each stock option grant awarded using the Black-Scholes option pricing model and management assumptions made regarding various factors, including expected volatility of our common stock, expected life of options granted and estimated forfeiture rates, which require use of accounting judgment and financial estimates. We compute the expected term based upon an analysis of historical exercises of stock options by our employees. We compute our expected volatility using historical prices of our common stock for a period equal to the expected term of the options. The risk free interest rate is determined using the implied yield on U.S. Treasury issues with a remaining term within the contractual life of the award. We estimate an annual forfeiture rate based on our historical forfeiture data, which rate will be revised, if necessary, in future periods if actual forfeitures differ from those estimates. Any material change in the estimates used in calculating the stock-based compensation expense could result in a material impact on our results of operations. | ||||||||
Foreign Currency Translation | ||||||||
The local currency of our foreign operations is their functional currency. The financial statements of our foreign subsidiaries are translated into U.S. dollars in accordance with ASC 830-30. Accordingly, the assets and liabilities of our Canadian and Philippine subsidiaries are translated into U.S. dollars at the exchange rate in effect at the balance sheet dates. Income and expense items are translated at the average exchange rate for each month within the year. The resulting translation adjustments are recorded in “Accumulated other comprehensive income (loss),” a separate component of stockholders’ equity on our Consolidated Balance Sheets. All transaction gains or losses are recorded in “Selling, general and administrative expenses” on our Consolidated Statements of Operations. These gains or losses were not material in any of the years presented in our consolidated financial statements. | ||||||||
Recent Accounting Pronouncements | ||||||||
In May 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which provides comprehensive guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. The core principle of the guidance provides that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, using either a full retrospective or modified retrospective method of adoption. We are currently evaluating the transition method we will adopt and the impact of the adoption of ASU 2014-09 on our consolidated financial statements. | ||||||||
In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”), which amended guidance on the presentation of financial statements and reporting discontinued operations and disclosures of disposals of components of an entity within property, plant and equipment. ASU 2014-08 amends the definition of a discontinued operation and requires entities to disclose additional information about disposal transactions that do not meet the discontinued-operations criteria. ASU 2014-08 is effective for disposals that occur in annual periods (and interim periods therein) beginning on or after December 15, 2014. We are currently evaluating the impact that ASU 2014-08 will have on our consolidated financial statements. | ||||||||
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Stock-Based Compensation | ||||||||||||
Stock-Based Compensation | ||||||||||||
3. Stock-Based Compensation | ||||||||||||
Stock-Based Benefit Plan | ||||||||||||
PCM, Inc. 2012 Equity Incentive Plan | ||||||||||||
In April 2012, the Compensation Committee of our Board of Directors approved and adopted our 2012 Equity Incentive Plan (the “2012 Plan”). In June 2012, the Plan was approved by our stockholders at our 2012 annual stockholders meeting. Upon the adoption of the 2012 Plan, our 1994 Stock Incentive Plan (the “1994 Plan”) was terminated, canceling the shares that remained available for grant under the 1994 Plan. Outstanding awards granted under the 1994 Plan continue unaffected following the termination of the 1994 Plan. | ||||||||||||
The 2012 Plan authorizes our Board and the Compensation Committee to grant equity-based compensation awards in the form of stock options, SARs, restricted stock, RSUs, performance shares, performance units, and other awards for the purpose of providing our directors, officers and other employees incentives and rewards for performance. The 2012 Plan does not contain an evergreen provision. The 2012 Plan is administered by the Compensation Committee under delegated authority from the Board. The Board or Compensation Committee may delegate its authority under the 2012 Plan to a subcommittee. The Compensation Committee or the subcommittee may delegate to one or more of its members or to one or more of our officers, or to one or more agents or advisors, administrative duties, and the Compensation Committee may also delegate powers to one or more of our officers to designate employees to receive awards under the 2012 Plan and determine the size of any such awards (subject to certain limitations described in the 2012 Plan). | ||||||||||||
At December 31, 2014, a total of 151,083 shares of authorized and unissued shares were available for future grants. All options granted through December 31, 2014 have been Nonstatutory Stock Options. We satisfy stock option exercises and vesting of RSUs with newly issued shares. | ||||||||||||
Stock-Based Compensation | ||||||||||||
For the years ended December 31, 2014, 2013 and 2012, we recognized stock-based compensation expense of $1.5 million, $1.5 million and $1.9 million, respectively, in “Selling, general and administrative expenses” in our Consolidated Statements of Operations, and related deferred income tax benefits of $0.7 million, $0.6 million and $0.7 million, respectively. | ||||||||||||
Valuation Assumptions | ||||||||||||
We estimated the grant date fair value of each stock option grant awarded during the years ended December 31, 2014, 2013 and 2012 using the Black-Scholes option pricing model and management assumptions made regarding various factors which require extensive use of accounting judgment and financial estimates. We compute the expected term based upon an analysis of historical exercises of stock options by our employees. We computed our expected volatility using historical prices of our common stock for a period equal to the expected term of the options. The risk free interest rate was determined using the implied yield on U.S. Treasury issues with a remaining term within the contractual life of the award. Each year, we estimated an annual forfeiture rate based on our historical forfeiture data, which rate is revised, if necessary, in future periods if actual forfeitures differ from those estimates. | ||||||||||||
The following table presents the weighted average assumptions we used in each of the following years: | ||||||||||||
Years Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Risk free interest rate | 1.79 | % | 1.13 | % | 0.97 | % | ||||||
Expected volatility | 62 | % | 74 | % | 75 | % | ||||||
Expected term (in years) | 6 | 6 | 6 | |||||||||
Expected dividend yield | None | None | None | |||||||||
Stock-Based Payment Award Activity | ||||||||||||
Stock Options | ||||||||||||
The following table summarizes our stock option activity during the year ended December 31, 2014 and stock options outstanding and exercisable at December 31, 2014 for the above plans: | ||||||||||||
Weighted | ||||||||||||
Weighted | Average | Aggregate | ||||||||||
Average | Remaining | Intrinsic | ||||||||||
Exercise | Contractual | Value | ||||||||||
Number | Price | Term (in years) | (in thousands) | |||||||||
Outstanding at December 31, 2013 | 2,938,152 | $ | 6.69 | |||||||||
Granted | 104,000 | 10 | ||||||||||
Exercised | (827,892 | ) | 6.1 | |||||||||
Forfeited | (84,937 | ) | 6.89 | |||||||||
Expired/cancelled | (21,059 | ) | 9.25 | |||||||||
Outstanding at December 31, 2014 | 2,108,264 | 7.05 | 4.26 | $ | 5,681 | |||||||
Exercisable at December 31, 2014 | 1,680,150 | 6.94 | 3.9 | 4,758 | ||||||||
The aggregate intrinsic value is calculated for in-the-money options based on the difference between the exercise price of the underlying awards and the closing price of our common stock on December 31, 2014, which was $9.52. | ||||||||||||
Years Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Weighted average grant-date fair value of options granted during the period | $ | 5.79 | $ | 5.19 | $ | 3.68 | ||||||
Total intrinsic value of options exercised during the period (in thousands) | 3,115 | 2,001 | 515 | |||||||||
Total fair value of shares vested during the period (in thousands) | 1,124 | 1,505 | 1,876 | |||||||||
As of December 31, 2014, there was $1.8 million of unrecognized compensation cost related to unvested outstanding stock options. We expect to recognize these costs over a weighted average period of 2.91 years. | ||||||||||||
Restricted Stock Units | ||||||||||||
We estimate the fair value of RSU awards based on the closing stock price of our common shares on the date of grant. The following table summarizes our RSU activity during the year ended December 31, 2014 issued under the above plans: | ||||||||||||
Restricted Stock | Weighted Average | |||||||||||
Units | Grant Date | |||||||||||
Fair Value | ||||||||||||
Non-vested at December 31, 2013 | 85,000 | $ | 7.65 | |||||||||
Granted | 300,000 | 9.48 | ||||||||||
Vested and distributed | (21,000 | ) | 7.65 | |||||||||
Forfeited | (7,000 | ) | 7.65 | |||||||||
Non-vested at December 31, 2014 | 357,000 | 9.18 | ||||||||||
The weighted average grant-date fair value of RSUs granted during the year ended December 31, 2013 was $7.58. There were no RSUs granted during the year ended December 31, 2012. | ||||||||||||
Property_and_Equipment
Property and Equipment | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property and Equipment | ||||||||
Property and Equipment | ||||||||
4. Property and Equipment | ||||||||
Property and equipment consisted of the following (in thousands): | ||||||||
At December 31, | ||||||||
2014 | 2013 | |||||||
Computers, software, machinery and equipment | $ | 65,694 | $ | 64,188 | ||||
Leasehold improvements | 7,797 | 5,390 | ||||||
Furniture and fixtures | 6,020 | 4,900 | ||||||
Building and improvements | 18,674 | 10,401 | ||||||
Land | 12,007 | 12,007 | ||||||
Software development and other equipment in progress | 22,904 | 11,928 | ||||||
Subtotal | 133,096 | 108,814 | ||||||
Less: Accumulated depreciation and amortization | (58,728 | ) | (53,021 | ) | ||||
Property and equipment, net | $ | 74,368 | $ | 55,793 | ||||
We capitalized interest costs of $0.6 million and $0.3 million in 2014 and 2013, respectively, primarily relating to internally developed software costs during development and the construction of our data center in New Albany, Ohio. Depreciation and amortization expense for property and equipment, including fixed assets under capital leases, for the years ended December 31, 2014, 2013 and 2012 totaled $10.3 million, $9.3 million and $9.0 million. | ||||||||
In May 2013, we completed the purchase of real property adjacent to the building we own in Santa Monica, California for $3.0 million and financed $1.7 million of the purchase price with a sub-line under our primary revolving credit facility. For more information on this financing arrangement, see Note 8 below. | ||||||||
In December 2012, we completed the purchase of 7.9 acres of land for approximately $1.1 million and have incurred additional costs of $12.2 million through December 31, 2014 towards the construction of a new cloud data center that we opened in June 2014. The Tier III facility is strategically located in a data center-centric development in New Albany, Ohio. The new facility complements our two existing data centers and a 24/7 Integrated Operations Center (IOC) located in Atlanta, Georgia, enhancing our managed service offerings, including cloud services, data center hosting and management, remote monitoring and disaster recovery. For more information on the financing arrangement relating to the construction costs of the data center, see Note 8 below. | ||||||||
Throughout 2014 and 2013, we entered into additional capital lease schedules with a bank totaling approximately $0.5 million and $1.3 million, respectively. The capital leases are primarily related to the data center we are constructed in New Albany, Ohio and various furniture and equipment at our El Segundo, California corporate headquarters office. The capital lease schedules entered into 2014 and 2013 has a term ranging from three to five years. See Note 10 below for information related to capital lease obligations. | ||||||||
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||
Goodwill and Intangible Assets | ||||||||||||||||||||||
Goodwill and Intangible Assets | ||||||||||||||||||||||
5. Goodwill and Intangible Assets | ||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||
There were no changes in the carrying amounts of goodwill during each of the years ended December 31, 2014, 2013 and 2012. Goodwill totaled $25.5 million as of December 31, 2014, 2013 and 2012, all of which related to our Commercial segment. | ||||||||||||||||||||||
Intangible Assets | ||||||||||||||||||||||
The following table sets forth the amounts recorded for intangible assets (in thousands): | ||||||||||||||||||||||
Weighted | At December 31, 2014 | At December 31, 2013 | ||||||||||||||||||||
Average | ||||||||||||||||||||||
Estimated | ||||||||||||||||||||||
Useful Lives | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||
(years) | Amount | Amortization | Amount | Amount | Amortization | Amount | ||||||||||||||||
Patent, trademarks & URLs | 9 | $ | 3,593 | -1 | $ | 307 | $ | 3,286 | $ | 3,286 | -1 | $ | 271 | $ | 3,015 | |||||||
Customer relationships | 10 | 2,550 | 1,163 | 1,387 | 2,550 | 908 | 1,642 | |||||||||||||||
Non-compete agreements | — | — | — | — | 250 | 223 | 27 | |||||||||||||||
Total intangible assets | $ | 6,143 | $ | 1,470 | $ | 4,673 | $ | 6,086 | $ | 1,402 | $ | 4,684 | ||||||||||
-1 | Included in the total amount for “Patent, trademarks & URLs” at December 31, 2014 and 2013 are $2.9 million of trademarks with indefinite useful lives that are not amortized. | |||||||||||||||||||||
Amortization expense for intangible assets was $0.3 million, $1.7 million and $2.6 million in each of the years ended December 31, 2014, 2013 and 2012. | ||||||||||||||||||||||
Estimated amortization expense for intangible assets in each of the next five years and thereafter, as applicable, as of December 31, 2014 is as follows: $0.3 million in 2015, $0.3 million in 2016, $0.3 million in 2017, $0.3 million in 2018, $0.3 million in 2019 and $0.2 million thereafter. | ||||||||||||||||||||||
Discontinued_Operations
Discontinued Operations | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Discontinued Operations | |||||||||||
Discontinued Operations | |||||||||||
6. Discontinued Operations | |||||||||||
During 2014, we discontinued the operation of all four of our retail stores, located in Huntington Beach, Santa Monica and Torrance, California and Chicago, Illinois, and our OnSale and eCost businesses. We reflected the results of these operations, which were historically reported as a part of our MacMall segment, as discontinued operations for all periods presented herein. The revenues, operating and non-operating results of the discontinued operations are reflected in a single line item entitled “Loss from discontinued operations, net of taxes” on our Consolidated Statements of Operations, and the related assets and liabilities are presented in our Consolidated Balance Sheets in line items entitled “Current assets of discontinued operations,” “Non-current assets of discontinued operations” and “Current liabilities of discontinued operations” for all periods presented herein. | |||||||||||
The carrying amounts of major classes of assets and liabilities that have been included in such balance sheet line items, as described above, in our Consolidated Balance Sheets were as follows (in thousands): | |||||||||||
At December 31, | |||||||||||
2014 | 2013 | ||||||||||
Accounts receivable, net | $ | 19 | $ | 329 | |||||||
Inventories, net | 7 | 5,517 | |||||||||
Current assets of discontinued operations | 26 | 5,846 | |||||||||
Fixed assets, net | — | 814 | |||||||||
Intangible assets, net | — | 466 | |||||||||
Other non-current assets | 14 | 19 | |||||||||
Non-current assets of discontinued operations | 14 | 1,299 | |||||||||
Total assets of discontinued operations | $ | 40 | $ | 7,145 | |||||||
Accounts payable | $ | 116 | $ | 220 | |||||||
Accrued expenses and other current liabilities | 458 | 464 | |||||||||
Deferred revenue | 3 | 29 | |||||||||
Current liabilities of discontinued operations | $ | 577 | $ | 713 | |||||||
The operating results of our discontinued operations reported in “Loss from discontinued operations, net of taxes” in our Consolidated Statements of Operations were as follows (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Net sales | $ | 29,746 | $ | 64,200 | $ | 78,561 | |||||
Loss before income taxes | $ | (2,795 | ) | $ | (887 | ) | $ | (1,034 | ) | ||
Income tax benefit | (1,225 | ) | (371 | ) | (435 | ) | |||||
Loss from discontinued operations, net of taxes | $ | (1,570 | ) | $ | (516 | ) | $ | (599 | ) | ||
Rebranding_Strategy_and_Cost_R
Rebranding Strategy and Cost Reduction Initiatives | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Rebranding Strategy and Cost Reduction Initiatives | |||||||||||||||||
Rebranding Strategy and Cost Reduction Initiatives | |||||||||||||||||
7. Rebranding Strategy and Cost Reduction Initiatives | |||||||||||||||||
Over the past several years, our company has grown into approximately a $1.4 billion enterprise in part through our acquisition and internal cultivation of different brands. We have historically differentiated those brands primarily based on the identity of the customers they serve. After careful examination of the trends taking shape in the markets we serve, in 2012, we determined that going forward, our commercial customers can benefit from a more unified and streamlined brand strategy. We consolidated our commercial brands and realigned our customer segments in an effort to realize significant growth and to achieve a more efficient cost structure. We believe this unification provides an improved customer experience, operational synergies and benefits to all of our stakeholders, providing a brand that better represents the technology solutions provider we are today. | |||||||||||||||||
Effective December 31, 2012, we changed our corporate name from PC Mall, Inc. to PCM, Inc. and combined our primary commercial subsidiaries PC Mall Sales, Inc., Sarcom, Inc. and PC Mall Services, Inc. into a single subsidiary. The combined subsidiary now operates under the unified commercial brand PCM and generally includes our SMB, MME and portions of our Corporate & Other segments. Additionally, in connection with the rebranding, our PC Mall Gov, Inc. subsidiary changed its name to PCMG, Inc. and now operates under the brand PCM-G. | |||||||||||||||||
An important part of these initiatives is a focused reduction of our overhead expenses. These and other related actions resulted in severance and restructuring related expenses of approximately $2.3 million and $2.9 million, respectively, in the years ended December 31, 2013 and 2012. No such costs were incurred in the year ended December 31, 2014. A summary of our total restructuring costs, which are included in “Selling, general and administrative expenses” on our Consolidated Statements of Operations, is as follows by each of our reportable operating segments (in thousands): | |||||||||||||||||
Commercial | Public | MacMall | Corporate | Consolidated | |||||||||||||
Sector | & | ||||||||||||||||
Other | |||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
Employee termination costs | $ | 214 | $ | 34 | $ | 16 | $ | 430 | $ | 694 | |||||||
Accelerated trademark amortization costs | 916 | — | — | — | 916 | ||||||||||||
Other costs | 200 | 351 | 5 | 117 | 673 | ||||||||||||
Total | $ | 1,330 | $ | 385 | $ | 21 | $ | 547 | $ | 2,283 | |||||||
Year Ended December 31, 2012 | |||||||||||||||||
Employee termination costs | $ | 566 | $ | 19 | $ | 137 | $ | 953 | $ | 1,675 | |||||||
Accelerated trademark amortization costs | 874 | — | — | — | 874 | ||||||||||||
Other costs | — | — | — | 349 | 349 | ||||||||||||
Total | $ | 1,440 | $ | 19 | $ | 137 | $ | 1,302 | $ | 2,898 | |||||||
Employee termination costs include costs of severance and other discretionary payments upon employee terminations, and include estimated taxes and benefits associated with such payments. Trademark amortization costs include accelerated amortization of the Sarcom and NSPI trademarks compared to the previous year resulting from the anticipated consolidation of our commercial brands to PCM in January 2013. Such trademarks became fully amortized in December 2013. Other costs in the table above represent legal and other costs related to various restructuring and related activities. | |||||||||||||||||
A summary rollforward of our restructuring costs, which are recorded as part of “Accrued expenses and other current liabilities” on our Consolidated Balance Sheets, is as follows (in thousands): | |||||||||||||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2013 | to Expense | December 31, 2014 | |||||||||||||||
Employee termination costs | $ | 140 | $ | — | $ | (140 | ) | $ | — | $ | — | ||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2012 | to Expense | December 31, 2013 | |||||||||||||||
Employee termination costs | $ | 212 | $ | 694 | $ | (766 | ) | $ | — | $ | 140 | ||||||
Other costs | 43 | 673 | (716 | ) | — | — | |||||||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2011 | to Expense | December 31, 2012 | |||||||||||||||
Employee termination costs | $ | — | $ | 1,675 | $ | (1,463 | ) | $ | — | $ | 212 | ||||||
Other costs | — | 349 | (306 | ) | — | 43 | |||||||||||
Line_of_Credit_and_Note_Payabl
Line of Credit and Note Payable | 12 Months Ended |
Dec. 31, 2014 | |
Line of Credit and Note Payable | |
Line of Credit and Note Payable | |
8. Line of Credit and Notes Payable | |
We maintain an asset-based revolving credit facility that provides for, among other things, (i) a credit limit of $200 million; (ii) LIBOR interest rate options that we can enter into with no limit on the maximum outstanding principal balance which may be subject to a LIBOR interest rate option; and (iii) a maturity date of September 30, 2017. The credit facility, which functions as a working capital line of credit with a borrowing base of inventory and accounts receivable, including certain credit card receivables, and a portion of the value of certain real estate, also includes a monthly unused line fee of 0.25% per year on the amount, if any, by which the Maximum Credit, as defined in the agreement, then in effect, exceeds the average daily principal balance of the outstanding borrowings during the immediately preceding month. | |
The credit facility is collateralized by substantially all of our assets. In addition to the security interest required by the credit facility, certain of our vendors have security interests in some of our assets related to their products. The credit facility has as its single financial covenant a minimum fixed charge coverage ratio (FCCR) requirement in the event an FCCR triggering event has occurred. An FCCR triggering event is comprised of maintaining certain specified daily and average excess availability thresholds. In the event the FCCR covenant applies, the fixed charge coverage ratio is 1.0 to 1.0 calculated on a trailing four-quarter basis as of the end of the last quarter immediately preceding such FCCR triggering event date. At December 31, 2014, we were in compliance with our financial covenant under the credit facility. | |
Loan availability under the line of credit fluctuates daily and is affected by many factors, including eligible assets on-hand, opportunistic purchases of inventory and availability and our utilization of early-pay discounts. At December 31, 2014, we had $52.8 million of net working capital advances outstanding under the line of credit. At December 31, 2014, we had $89.5 million available to borrow for working capital advances under the line of credit. | |
In connection with, and as part of, our revolving credit facility, we maintain a term note with a principal balance of $4.34 million, payable in equal monthly principal installments of approximately $52,000, amortized over 84 months, beginning on April 1, 2013, plus interest at the prime rate with a LIBOR option. In the event of a default, termination or non-renewal of the revolving credit facility upon the maturity thereof, the term loan is payable in its entirety upon demand by the lenders. At December 31, 2014, we had approximately $3.3 million outstanding under the term note, which matures as follows: $0.6 million annually in each of the years 2015 through 2019, and $0.2 million thereafter. | |
Throughout 2014, we entered into three financing arrangements with a bank to finance the costs of equipment, software and professional services related to our ERP upgrade. The total amount financed was $5.6 million, with a quarterly repayment schedule maturing in March 2017. At December 31, 2014, we had $4.5 million outstanding under these financing arrangements, which matures as follows: $2.0 million in each of the years 2015 through 2016, and $0.5 million in 2017. | |
In May 2013, we completed the purchase of real property adjacent to the building we own in Santa Monica, California for $3.0 million and financed $1.7 million of the purchase price with a sub-line under our revolving credit facility. The loan bears the same interest terms as our revolving credit facility and interest is payable monthly. The principal amount is amortized monthly over an 84 month period similar to our term note, with monthly principal amortization of approximately $24,000 that began in July 2014. At December 31, 2014, we had approximately $1.6 million outstanding under this note, which matures as follows: $0.3 million annually in each of the years 2015 through 2019, and $0.1 million thereafter. | |
In December 2012, we completed the purchase of 7.9 acres of land for approximately $1.1 million and have incurred additional costs of $12.2 million through December 31, 2014 towards the construction of a new cloud data center that we opened in June 2014. In July 2013, we entered into a loan agreement for up to $7.725 million to finance the build out of the new data center. The loan agreement provided for draws during a construction period subsequent to reaching certain expenditure thresholds. Any outstanding borrowing during the construction period, which was through December 31, 2014, bore interest at the prime rate plus 0.25%, followed by a five year term and a 25 year straight-line, monthly principal repayment amortization period with a balloon payment at maturity in January 2020. Interest during the amortization period is variable, indexed to LIBOR plus a spread of 2.25%. At December 31, 2014, we had $7.725 million outstanding under this loan agreement, which matures as follows: $0.3 million annually in each of the years 2015 through 2019, and $6.2 million thereafter. The loan is secured by the real property and contains financial covenants substantially similar to those of our existing asset-based credit facility. | |
In June 2011, we entered into a credit agreement to finance the acquisition and improvement of the real property we purchased in March 2011 in El Segundo, California. The credit agreement provides for a five year term and a 25 year straight-line, monthly principal repayment amortization period with a balloon payment at maturity in September 2016. Interest is variable, indexed to Prime plus a spread of 0.375% or LIBOR plus a spread of 2.375% at our option, and payable monthly. At December 31, 2014, we had $8.9 million outstanding under this credit agreement, which matures as follows: $0.4 million in 2015 and $8.5 million in 2016. The loan is secured by the real property and contains financial covenants substantially similar to those of our existing asset-based credit facility. | |
At December 31, 2014, our effective weighted average annual interest rate on outstanding amounts under the credit facility, term note and notes payable was 2.31%. | |
The carrying amounts of our line of credit borrowings and notes payable approximate their fair value based upon the current rates offered to us for obligations of similar terms and remaining maturities. | |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Income Taxes | |||||||||||
Income Taxes | |||||||||||
9. Income Taxes | |||||||||||
“Income from continuing operations before income taxes” in the Consolidated Statements of Operations included the following components for the periods presented (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
U.S. income | $ | 11,533 | $ | 13,774 | $ | 8,230 | |||||
Foreign income | 992 | 1,106 | 1,597 | ||||||||
Income from continuing operations before income taxes | $ | 12,525 | $ | 14,880 | $ | 9,827 | |||||
“Income tax expense” in the Consolidated Statements of Operations consisted of the following for the periods presented (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Current | |||||||||||
Federal | $ | 260 | $ | 2,920 | $ | 252 | |||||
State | 405 | 948 | 862 | ||||||||
Foreign | 613 | 828 | 104 | ||||||||
Total — Current | 1,278 | 4,696 | 1,218 | ||||||||
Deferred | |||||||||||
Federal | 3,847 | 1,595 | 2,395 | ||||||||
State | 545 | 287 | 216 | ||||||||
Foreign | (180 | ) | (343 | ) | 305 | ||||||
Total — Deferred | 4,212 | 1,539 | 2,916 | ||||||||
Income tax expense | $ | 5,490 | $ | 6,235 | $ | 4,134 | |||||
The provision for income taxes differed from the amount computed by applying the U.S. federal statutory rate to income before income taxes due to the effects of the following: | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Expected taxes at federal statutory tax rate | 35 | % | 35 | % | 34 | % | |||||
State income taxes, net of federal income tax benefit | 7.6 | 4.4 | 8.1 | ||||||||
Change in valuation allowance | (1.9 | ) | 1.8 | 0.2 | |||||||
Non-deductible business expenses | 2.8 | 0.9 | 2.7 | ||||||||
Other | 0.3 | (0.2 | ) | (2.9 | ) | ||||||
Total | 43.8 | % | 41.9 | % | 42.1 | % | |||||
The U.S. statutory rate applied in the effective tax rate reconciliation increased from 34% in the year ended December 31, 2012 to 35% in the years ended December 31, 2013 and 2014 as a result of projected increases in taxable income in future years resulting from both higher levels of projected pre-tax book income as well as anticipated reversals of deferred taxable items. | |||||||||||
The significant components of deferred tax assets and liabilities were as follows (in thousands): | |||||||||||
At December 31, | |||||||||||
2014 | 2013 | ||||||||||
Deferred tax assets : | |||||||||||
Accounts receivable | $ | 171 | $ | 549 | |||||||
Inventories | 128 | 305 | |||||||||
Deferred revenue | 251 | 325 | |||||||||
Accrued expenses and reserves | 2,809 | 2,135 | |||||||||
Stock based compensation | 2,844 | 3,790 | |||||||||
Tax credits and loss carryforwards | 4,514 | 2,431 | |||||||||
Other | 108 | — | |||||||||
Total gross deferred tax assets | 10,825 | 9,535 | |||||||||
Less: Valuation allowance | (805 | ) | (987 | ) | |||||||
Total deferred tax assets | 10,020 | 8,548 | |||||||||
Deferred tax liabilities: | |||||||||||
Property and equipment | (13,916 | ) | (9,792 | ) | |||||||
Intangibles | (2,604 | ) | (2,050 | ) | |||||||
Foreign employment tax subsidy | (1,550 | ) | (1,887 | ) | |||||||
Prepaid expenses | (918 | ) | (659 | ) | |||||||
Other | (153 | ) | (200 | ) | |||||||
Total deferred tax liabilities | (19,141 | ) | (14,588 | ) | |||||||
Net deferred tax liabilities | $ | (9,121 | ) | $ | (6,040 | ) | |||||
The valuation allowance relates entirely to certain state net operating loss carryforwards, as well as other state deferred tax assets generated by subsidiaries in a cumulative loss position. The valuation allowance decreased by $0.2 million during the year ended December 31, 2014 due to a decrease in the state deferred tax assets of loss subsidiaries. | |||||||||||
Current deferred tax liabilities relating primarily to foreign employment tax subsidy of $0.8 million and $1.0 million at December 31, 2014 and 2013, respectively, included in the table above, were included as part of “Accrued expenses and other current liabilities” on our Consolidated Balance Sheets. | |||||||||||
At December 31, 2014, we had federal net operating loss carryforwards of $8.8 million, which begin to expire at the end of 2024. We also had state net operating loss carryforwards of $31.7 million, of which $2.2 million expire between 2016 and 2019, and the remainder expires between 2020 and 2028. Included in these amounts are $2.7 million of federal net operating loss carryforwards and $1.1 million of state net operating loss carryforwards which relate to an acquired subsidiary and are subject to annual limitations as to their use under IRC Section 382. As such, the extent to which these losses may offset future taxable income may be limited. | |||||||||||
Cumulative undistributed earnings of our Canadian subsidiary for which no U.S. income taxes have been provided approximated $12.6 million at December 31, 2014. Deferred U.S. income taxes on these earnings have not been provided as these amounts are considered to be permanently reinvested. At the present time, it is not practicable to estimate the amount of tax that may be payable if these earnings were repatriated because of the complexities of the hypothetical calculation. | |||||||||||
Accounting for Uncertainty in Income Taxes | |||||||||||
ASC 740 clarifies the accounting for uncertainty in tax positions by prescribing the recognition threshold a tax position is required to meet before being measured and then recognized in the financial statements. It also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have elected to classify interest and penalties related to income tax liabilities, when applicable, as part of interest and penalty expense in our consolidated statement of income rather than as a component of income tax expense. | |||||||||||
At December 31, 2014, we had no unrecognized tax positions. For the years ended December 31, 2014, 2013 and 2012, we did not recognize any interest or penalties for uncertain tax positions. There were also no accrued interest and penalties at December 31, 2014 and December 31, 2013. We do not anticipate any significant increases in our unrecognized tax benefits within the next twelve months. Further, since we did not have any unrecognized tax benefits at December 31, 2014, we do not, accordingly, anticipate any significant decreases within the next twelve months. | |||||||||||
We are subject to U.S. and foreign income tax examinations for years subsequent to 2009, and state income tax examinations for years following 2010. However, to the extent allowable by law, the tax authorities may have a right to examine prior periods when net operating losses or tax credits were generated and carried forward for subsequent utilization, and make adjustments up to the amount of the net operating losses or credit carryforwards. | |||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||
Commitments and Contingencies | |||||||||||||||||||||||
Commitments and Contingencies | |||||||||||||||||||||||
10. Commitments and Contingencies | |||||||||||||||||||||||
Commitments | |||||||||||||||||||||||
We lease office and warehouse space and equipment under various non-cancelable operating leases which provide for minimum annual rentals and escalations based on increases in real estate taxes and other operating expenses. We also have minimum commitments under non-cancelable contracts for services relating to telecommunications, IT maintenance, financial services and employment contracts with certain employees (which consist of severance arrangements that, if exercised, would become payable in less than one year). In addition, we have obligations under capital leases for computers and related equipment, telecommunications equipment and software. | |||||||||||||||||||||||
As of December 31, 2014, minimum payments over the terms of applicable contracts were payable as follows (in thousands): | |||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | |||||||||||||||||
Operating lease obligations | $ | 6,278 | $ | 4,995 | $ | 2,715 | $ | 2,367 | $ | 1,767 | $ | 4,162 | $ | 22,284 | |||||||||
Capital lease obligations | 2,310 | 1,817 | 676 | 40 | 17 | — | 4,860 | ||||||||||||||||
Other commitments (a)(b) | 18,693 | 1,269 | 95 | — | — | — | 20,057 | ||||||||||||||||
Total minimum payments | $ | 27,281 | $ | 8,081 | $ | 3,486 | $ | 2,407 | $ | 1,784 | $ | 4,162 | $ | 47,201 | |||||||||
(a) | Other commitments consist of minimum commitments under non-cancelable contracts for services relating to telecommunications, IT maintenance, financial services and employment contracts with certain employees (which consist of severance arrangements that, if exercised, would become payable in less than one year). | ||||||||||||||||||||||
(b) | We had $10.0 million of standby letters of credits (LOCs) under which there were no minimum payment requirements at December 31, 2014. LOCs are commitments issued to third party beneficiaries, underwritten by a third party bank, representing funding responsibility in the event of third party demands or contingent events. The outstanding balance of our standby LOCs reduces the amount available to us from our revolving credit facility. There were no claims made against any standby LOCs during the year ended December 31, 2014. | ||||||||||||||||||||||
For the years ended December 31, 2014, 2013 and 2012, total rent expense, net of sublease income, totaled $4.6 million, $4.9 million and $4.8 million, respectively. Some of the leases contain renewal options and escalation clauses, and require us to pay taxes, insurance and maintenance costs. | |||||||||||||||||||||||
Legal Proceedings | |||||||||||||||||||||||
We are not currently a party to any legal proceedings with loss contingencies, which are expected to be material. From time to time, we receive claims of and become subject to consumer protection, employment, intellectual property and other litigation related to the conduct of our business. Any such litigation could result in a material amount of legal or related expenses and be time consuming and could divert our management and key personnel from our business operations. In connection with any such litigation, we may be subject to significant damages or equitable remedies relating to the operation of our business. Any such litigation may materially harm our business, results of operations and financial condition. | |||||||||||||||||||||||
Stockholders_Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2014 | |
Stockholders' Equity | |
Stockholders' Equity | |
11. Stockholders’ Equity | |
In September 2012, our Board of Directors approved a $10 million increase to our discretionary stock repurchase program, which was originally adopted in October 2008 with an initial authorized maximum of $10 million. Under the program, the shares may be repurchased from time to time at prevailing market prices, through open market or unsolicited negotiated transactions, depending on market conditions. We expect that the repurchase of our common stock under the program will be financed with existing working capital and amounts available under our existing credit facility. The repurchased shares are held as treasury stock. No limit was placed on the duration of the repurchase program. There is no guarantee as to the exact number of shares that we will repurchase. Subject to applicable securities laws, repurchases may be made at such times and in such amounts as our management deems appropriate. The program can also be discontinued at any time management feels additional purchases are not warranted. | |
We repurchased a total of 228,771 shares of our common stock under this program during the year ended December 31, 2014 for a total cost of approximately $2.2 million. From the inception of the program in October 2008 through December 31, 2014, we have repurchased an aggregate total of 3,074,486 shares of our common stock for a total cost of $16.5 million. At December 31, 2014, we had $3.5 million available in stock repurchases under the program, subject to any limitations that may apply from time to time under our existing credit facility. | |
We have never paid cash dividends on our capital stock and our credit facility prohibits us from paying any cash dividends on our capital stock. Therefore, we do not currently anticipate paying dividends; we intend to retain any earnings to finance the growth and development of our business. | |
Earnings_Per_Common_Share
Earnings Per Common Share | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Basic and diluted earnings (loss) per common share from continuing operations: | ||||||||||
Earnings Per Common Share | ||||||||||
12. Earnings Per Common Share | ||||||||||
Basic earnings per share (“EPS”) excludes dilution. Diluted EPS reflects the potential dilution that could occur under the treasury stock method if stock options and other commitments to issue common stock were exercised, except in loss periods where the effect would be antidilutive. Potential common shares of approximately 562,000, 657,000 and 1,775,000 for the years ended December 31, 2014, 2013 and 2012 have been excluded from the calculation of diluted EPS because the effect of their inclusion would be antidilutive. | ||||||||||
The reconciliation of the amounts used in the basic and diluted EPS computation was as follows for income from continuing operations (in thousands, except per share amounts): | ||||||||||
Income From | Weighted Average | Per Share | ||||||||
Continuing | Number of | Amounts | ||||||||
Operations | Common Shares | |||||||||
Outstanding | ||||||||||
Year Ended December 31, 2014: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 7,035 | 12,251 | $ | 0.57 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 630 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 7,035 | 12,881 | $ | 0.55 | |||||
Year Ended December 31, 2013: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 8,645 | 11,583 | $ | 0.75 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 340 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 8,645 | 11,923 | $ | 0.73 | |||||
Year Ended December 31, 2012: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 5,693 | 11,989 | $ | 0.47 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 171 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 5,693 | 12,160 | $ | 0.47 | |||||
Employee_NonEmployee_Benefits
Employee & Non-Employee Benefits | 12 Months Ended |
Dec. 31, 2014 | |
Employee & Non-Employee Benefits | |
Employee & Non-Employee Benefits | |
13. Employee & Non-Employee Benefits | |
401(k) Savings Plan | |
We maintain a 401(k) Savings Plan which covers substantially all full-time employees who meet the plan’s eligibility requirements. Participants are allowed to make tax-deferred contributions up to limitations specified by the Internal Revenue Code. We make 25% matching contributions for amounts that do not exceed 4% of the participants’ compensation. The matched contributions to the employees are subject to a five year vesting provision, with credit given towards vesting for employment during prior years. We made matching contributions to the plan totaling approximately $545,000, $530,000 and $519,000 in 2014, 2013 and 2012, respectively. | |
Stock Options Issued to Non-Employees | |
On June 25, 2012 our Compensation Committee approved and granted, under our 2012 Plan, the award of options to purchase 10,000 shares of common stock to each of our non-employee members of our board. These options were issued at an exercise price of $5.44, vest quarterly over a two-year term, and have a ten-year life. On September 15, 2011, our Compensation Committee approved and granted, under our 1994 Plan, the award of options to purchase 10,000 shares of common stock to each of our non-employee members of our board. These options were issued at an exercise price of $6.24, vest quarterly over a two-year term, and have a seven-year life. See Note 3 for more information on our accounting for stock-based compensation. | |
Restricted Stock Units Issued to Non-Employees | |
On each of May 20, 2014 and May 20, 2013, our Compensation Committee approved and granted, under our 2012 Plan, the award of 6,000 shares of restricted stock units to each of our three non-employee members of the board for a total award of 36,000 restricted stock units. The restricted stock units each vest annually in equal amounts over a two year period from the respective dates of grant. See Note 3 for more information on our accounting for stock-based compensation. | |
Segment_Information
Segment Information | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Segment Information | |||||||||||||||||
Segment Information | |||||||||||||||||
14. Segment Information | |||||||||||||||||
Our three reportable operating segments - Commercial, Public Sector and MacMall - are primarily aligned based upon their respective customer base. We include corporate related expenses such as legal, accounting, information technology, product management and certain other administrative costs that are not otherwise included in our reportable operating segments in Corporate & Other. We allocate our resources to and evaluate the performance of our segments based on operating income. For more information on our reportable operating segments, see Note 1 above. | |||||||||||||||||
Summarized segment information for our continuing operations is as follows for the periods presented (in thousands): | |||||||||||||||||
Commercial | Public | MacMall | Corporate & | Consolidated | |||||||||||||
Sector | Other | ||||||||||||||||
Year Ended December 31, 2014 | |||||||||||||||||
Net sales | $ | 1,016,047 | $ | 214,723 | $ | 125,615 | $ | (23 | ) | $ | 1,356,362 | ||||||
Gross profit | 158,777 | 21,057 | 12,211 | 22 | 192,067 | ||||||||||||
Depreciation and amortization expense(1) | 2,416 | 45 | 116 | 8,070 | 10,647 | ||||||||||||
Operating profit | 58,029 | 8,349 | 1,290 | (51,963 | ) | 15,705 | |||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
Net sales | $ | 1,034,776 | $ | 187,142 | $ | 138,089 | $ | (8 | ) | $ | 1,359,999 | ||||||
Gross profit | 158,157 | 16,995 | 14,344 | 3 | 189,499 | ||||||||||||
Depreciation and amortization expense(1) | 3,911 | 73 | 82 | 6,980 | 11,046 | ||||||||||||
Operating profit | 63,486 | 3,714 | 2,968 | (51,948 | ) | 18,220 | |||||||||||
Year Ended December 31, 2012 | |||||||||||||||||
Net sales | $ | 1,026,222 | $ | 165,828 | $ | 150,290 | $ | (42 | ) | $ | 1,342,298 | ||||||
Gross profit | 151,783 | 16,514 | 15,506 | 327 | 184,130 | ||||||||||||
Depreciation and amortization expense(1) | 4,630 | 106 | 69 | 6,768 | 11,573 | ||||||||||||
Operating profit | 59,571 | 2,554 | 4,048 | (52,555 | ) | 13,618 | |||||||||||
-1 | Primary fixed assets relating to network and servers are managed by the Corporate headquarters. As such, depreciation expense relating to such assets is included as part of Corporate & Other. | ||||||||||||||||
As of December 31, 2014 and 2013, we had total consolidated assets of $389.2 million and $434.8 million. Our management does not have available to them and does not use total assets measured at the segment level in allocating resources. Therefore, such information relating to segment assets is not provided herein. | |||||||||||||||||
Sales of our products and services are made to customers primarily within the U.S. During the years ended December 31, 2014, 2013 and 2012, less than 1% of our total net sales were made to customers outside of the continental U.S. No single customer accounted for more than 10% of our total net sales in each of the years ended December 31, 2014, 2013 and 2012. | |||||||||||||||||
Our property and equipment, net, were located in the following countries as of the periods presented (in thousands): | |||||||||||||||||
At December 31, | |||||||||||||||||
Location: | 2014 | 2013 | 2012 | ||||||||||||||
U.S. | $ | 73,784 | $ | 55,217 | $ | 45,856 | |||||||||||
Philippines | 201 | 365 | 595 | ||||||||||||||
Canada | 383 | 211 | 347 | ||||||||||||||
Property and equipment, net | $ | 74,368 | $ | 55,793 | $ | 46,798 | |||||||||||
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events. | |
Subsequent Events | |
15. Subsequent Events | |
On March 13, 2015, PCM entered into an agreement to acquire the assets of En Pointe Technologies Sales, Inc.’s IT solutions provider business, excluding current tangible assets, such as accounts receivable and inventory. En Pointe Technologies Sales, Inc., is one of the nation’s largest independent IT solutions providers, is headquartered in Southern California. Under the terms of the agreement, PCM will pay an initial purchase price of $15 million in cash and future contingent earn-out consideration, including 22.5% of the future adjusted gross profit of the business and 10% of certain service revenues over the next three years. The assets will be acquired by an indirect wholly-owned subsidiary of PCM, which subsidiary will operate under the En Pointe brand following the closing. The transaction is subject to certain closing conditions and is currently expected to close on April 1, 2015. | |
On January 15, 2015, we completed the purchase of certain real property from Sarcom Properties, Inc., an unaffiliated third party, for approximately $6.6 million. We paid approximately $2.2 million in cash and financed $4.575 million with a long-term note. The $4.575 million term note provides for a five year term with a 25 year principal amortization period that began in February 2015, and bears interest at a variable rate of LIBOR plus 2.25%. The real property is located in Lewis Center, Ohio and includes approximately 12.4 acres of land together with a building for office and warehouse space of approximately 144,000 square feet. One of our other subsidiaries was the tenant of the building and it is currently being used as our second headquarters, sales office and distribution center. | |
Supplementary_Quarterly_Financ
Supplementary Quarterly Financial Information (Unaudited) | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Supplementary Quarterly Financial Information (Unaudited) | ||||||||||||||
Supplementary Quarterly Financial Information (Unaudited) | ||||||||||||||
16. Supplementary Quarterly Financial Information (Unaudited) | ||||||||||||||
The following tables summarize supplementary quarterly financial information (in thousands, except per share data): | ||||||||||||||
2014 | ||||||||||||||
1st Quarter (1) | 2nd Quarter (1) | 3rd Quarter (1) | 4th Quarter | |||||||||||
Net sales | $ | 325,337 | $ | 334,991 | $ | 336,801 | $ | 359,233 | ||||||
Gross profit | 48,705 | 47,976 | 45,199 | 50,187 | ||||||||||
Income from continuing operations | $ | 3,034 | $ | 1,808 | $ | 139 | $ | 2,054 | ||||||
Loss from discontinued operations, net of taxes | (147 | ) | (663 | ) | (279 | ) | (481 | ) | ||||||
Net income (loss) | $ | 2,887 | $ | 1,145 | $ | (140 | ) | $ | 1,573 | |||||
Basic and diluted earnings per common share from continuing operations: | ||||||||||||||
Basic | $ | 0.25 | $ | 0.14 | $ | 0.01 | $ | 0.17 | ||||||
Diluted | 0.24 | 0.14 | 0.01 | 0.16 | ||||||||||
2013 (1) | ||||||||||||||
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | |||||||||||
Net sales | $ | 316,995 | $ | 350,002 | $ | 335,811 | $ | 357,191 | ||||||
Gross profit | 44,333 | 49,113 | 47,910 | 48,143 | ||||||||||
Income from continuing operations | $ | 1,272 | $ | 3,301 | $ | 2,129 | $ | 1,943 | ||||||
Loss from discontinued operations, net of taxes | (36 | ) | (138 | ) | (205 | ) | (137 | ) | ||||||
Net income | $ | 1,236 | $ | 3,163 | $ | 1,924 | $ | 1,806 | ||||||
Basic and diluted earnings per common share from continuing operations: | ||||||||||||||
Basic | $ | 0.11 | $ | 0.29 | $ | 0.18 | $ | 0.16 | ||||||
Diluted | 0.11 | 0.28 | 0.18 | 0.16 | ||||||||||
-1 | All amounts reported herein for the quarterly periods of 2013 and the first, second and third quarters of 2014 have been recast to present all four of our retails stores and our OnSale and eCost businesses as discontinued operations. | |||||||||||||
SCHEDULE_II_VALUATION_AND_QUAL
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | ||||||||||||||
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS | |||||||||||||
For the Years Ended December 31, 2014, 2013 and 2012 | ||||||||||||||
(in thousands) | ||||||||||||||
Balance at | Additions | Deduction | Balance at | |||||||||||
Beginning | Charged to | from | End of | |||||||||||
of Year | Operations | Reserves | Year | |||||||||||
Allowance for doubtful accounts for the years ended: | ||||||||||||||
December 31, 2014 | $ | 1,407 | $ | 463 | $ | (1,444 | )(a) | $ | 426 | |||||
December 31, 2013 | 1,447 | 1,361 | (1,401 | )(a) | 1,407 | |||||||||
December 31, 2012 | 1,622 | 830 | (1,005 | )(a) | 1,447 | |||||||||
Valuation allowance for deferred tax assets for the years ended: | ||||||||||||||
December 31, 2014 | $ | 987 | $ | 43 | (b) | $ | (225 | )(b) | $ | 805 | ||||
December 31, 2013 | 737 | 293 | (b) | (43 | )(b) | 987 | ||||||||
December 31, 2012 | 719 | 131 | (b) | (113 | )(b) | 737 | ||||||||
(a) | Relates primarily to accounts written-off. | |||||||||||||
(b) | Relates primarily to changes in valuation allowances applied to various state net operating loss carryforwards. | |||||||||||||
Basis_of_Presentation_and_Summ1
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Basis of Presentation and Summary of Significant Accounting Policies | ||||||||
Principles of Consolidation | ||||||||
Principles of Consolidation | ||||||||
The accompanying financial statements included herein are presented on a consolidated basis and include our accounts and the accounts of all of our wholly-owned subsidiaries after elimination of intercompany accounts and transactions. | ||||||||
Use of Estimates in the Preparation of the Consolidated Financial Statements | ||||||||
Use of Estimates in the Preparation of the Consolidated Financial Statements | ||||||||
We prepare our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, which requires management to make estimates, judgments and assumptions that affect the amounts reported herein. Management bases its estimates, judgments and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods could differ from those estimates. | ||||||||
Revenue Recognition | ||||||||
Revenue Recognition | ||||||||
We adhere to the guidelines and principles of sales recognition described in ASC 605 — Revenue Recognition. Under ASC 605, product sales are recognized when the title and risk of loss are passed to the customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable and collectability is reasonably assured. Under these guidelines, the majority of our sales, including revenue from product sales and gross outbound shipping and handling charges, are recognized upon receipt of the product by the customer. In accordance with our revenue recognition policy, we perform an analysis to estimate the number of days products we have shipped are in transit to our customers using data from our third party carriers and other factors. We record an adjustment to reverse the impact of sale transactions based on the estimated value of products that have shipped, but have not yet been received by our customers, and we recognize such amounts in the subsequent period when delivery has occurred. Changes in delivery patterns or unforeseen shipping delays beyond our control could have a material impact on our revenue recognition for the current period. | ||||||||
For all product sales shipped directly from suppliers to customers, we take title to the products sold upon shipment, bear credit risk, and bear inventory risk for returned products that are not successfully returned to suppliers; therefore, these revenues are recognized at gross sales amounts. | ||||||||
We also sell certain products for which we act as an agent in accordance with ASC 605-45. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) or subscriptions. SA is an “insurance” or “maintenance” product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. | ||||||||
Some of our larger customers are offered the opportunity by certain of our vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, our vendors will transfer the license and invoice the customer directly, paying us an agency fee or commission on these sales. We record these fees as a component of net sales as earned and there is no corresponding cost of sales amount. In certain instances, we invoice the customer directly under an EA and accounts for the individual items sold based on the nature of the item. Our vendors typically dictate how the EA will be sold to the customer. | ||||||||
When a customer order contains multiple deliverables such as hardware, software and services which are delivered at varying times, we determine whether the delivered items can be considered separate units of accounting as prescribed under ASC 605-25, Revenue Recognition, Multiple-Element Arrangement. For arrangements with multiple units of accounting, arrangement consideration is allocated among the units of accounting, where separable, based on their relative selling price. Relative selling price is determined based on vendor-specific objective evidence, if it exists. Otherwise, third-party evidence of selling price is used, when it is available, and in circumstances when neither vendor-specific objective evidence nor third-party evidence of selling price is available, management’s best estimate of selling price is used. | ||||||||
Revenue from professional services is either recognized as incurred for services billed at an hourly rate or recognized using the proportional performance method for services provided at a fixed fee. Revenue for data center services, including internet connectivity, web hosting, server co-location and managed services, is recognized over the period the service is performed. | ||||||||
Sales are reported net of estimated returns and allowances, discounts, mail-in rebate redemptions and credit card chargebacks. If the actual sales returns, allowances, discounts, mail-in rebate redemptions or credit card chargebacks are greater than estimated by management, additional expense may be incurred. | ||||||||
Cost of Goods Sold | ||||||||
Cost of Goods Sold | ||||||||
Cost of goods sold includes product costs, outbound and inbound shipping costs and costs of delivered services, offset by certain market development funds, volume incentive rebates and other consideration from vendors. | ||||||||
We receive vendor consideration from our vendors in the form of cooperative marketing allowances, volume incentive rebates and other programs to support our marketing of their products. Most of our vendor consideration is accrued, when performance required for recognition is completed, as an offset to cost of sales in accordance with ASC 605-50, Revenue Recognition — Customer Payments and Incentives, since such funds are not a reimbursement of specific, incremental, identifiable costs incurred by us in selling the vendors’ products. For costs that are considered to be a reimbursement of specific, incremental, identifiable costs incurred by us in selling the vendors’ products, we accrue the vendor consideration as an offset to such costs in selling, general and administrative expenses. At the end of any given period, unbilled receivables related to our vendor consideration are included in “Accounts receivable, net of allowances” in our Consolidated Balance Sheets. | ||||||||
Cash and Cash Equivalents | ||||||||
Cash and Cash Equivalents | ||||||||
All highly liquid investments with initial maturities of three months or less and credit card receivables with settlement terms less than 5 days are considered cash equivalents. Amounts due from credit card processors classified as cash totaled $2.7 million and $2.5 million at December 31, 2014 and 2013. Checks issued but not presented for payment to the bank, net of available cash subject to a right of offset, totaling $1.9 million and $2.0 million as of December 31, 2014 and 2013 were included in “Accounts payable” in our Consolidated Balance Sheets. Our cash management programs result in utilizing available cash to pay down our line of credit. | ||||||||
Accounts Receivable | ||||||||
Accounts Receivable | ||||||||
We generate the majority of our accounts receivable through the sale of products and services to certain customers on account. In addition, we record vendor receivables at such time as all conditions have been met that would entitle us to receive such vendor funding, and is thereby considered fully earned. | ||||||||
The following table presents the gross amounts of our accounts receivable (in thousands): | ||||||||
At December 31, | ||||||||
2014 | 2013 | |||||||
Trade receivables | $ | 170,137 | $ | 164,594 | ||||
Vendor receivables | 24,563 | 30,241 | ||||||
Other receivables | 5,330 | 2,321 | ||||||
Total gross accounts receivable | 200,030 | 197,156 | ||||||
Less: Allowance for doubtful accounts receivable | (426 | ) | (1,407 | ) | ||||
Accounts receivable, net | $ | 199,604 | $ | 195,749 | ||||
For the years ended December 31, 2014 and 2013, “Vendor receivables” presented above included $13.7 million and $15.2 million, respectively, of unbilled receivables relating to vendor consideration, which is described above under “Cost of Goods Sold.” | ||||||||
Accounts receivable potentially subject us to credit risk. We extend credit to our customers based upon an evaluation of each customer’s financial condition and credit history, and generally do not require collateral. No customer accounted for more than 10% of trade accounts receivable at December 31, 2014 and 2013. We maintain an allowance for doubtful accounts receivable based upon estimates of future collection. We regularly evaluate our customers’ financial condition and credit history in determining the adequacy of our allowance for doubtful accounts. We have historically incurred credit losses within management’s expectations. We also maintain an allowance for uncollectible vendor receivables, which arise from vendor rebate programs, price protections and other promotions. We determine the sufficiency of the vendor receivable allowance based upon various factors, including payment history. Amounts received from vendors may vary from amounts recorded because of potential non-compliance with certain elements of vendor programs. If the estimated allowance for uncollectible accounts or vendor receivables subsequently proves to be insufficient, additional allowance may be required. | ||||||||
Inventories | ||||||||
Inventories | ||||||||
Inventories consist primarily of finished goods, and are stated at the lower of cost (determined under the first-in, first-out method) or market. As discussed under “Revenue Recognition” above, we do not record revenue and related cost of goods sold until there is persuasive evidence of an arrangement for sale, delivery has occurred, the sales price is fixed and determinable and collectability is reasonably assured. As such, inventories include goods-in-transit to customers at December 31, 2014 and 2013. | ||||||||
A substantial portion of our business is dependent on sales of Apple, HP, and products purchased from other vendors including Cisco, Dell, Ingram Micro, Lenovo, Microsoft and Tech Data. Products manufactured by HP represented 18%, 21% and 21% of our net sales in 2014, 2013 and 2012. Products manufactured by Apple represented approximately 15%, 17% and 18% of our net sales in 2014, 2013 and 2012. | ||||||||
Advertising Costs | ||||||||
Advertising Costs | ||||||||
Our advertising expenditures are expensed in the period incurred. Total net advertising expenditures, which were included in “Selling, general and administrative expenses” in our Consolidated Statements of Operations, were $4.3 million, $4.6 million and $4.0 million in the years ended December 31, 2014, 2013 and 2012, respectively. | ||||||||
Property and Equipment | ||||||||
Property and Equipment | ||||||||
Property and equipment are stated at cost and are depreciated using the straight-line method over the estimated useful lives of the assets, as noted below. Leasehold improvements are amortized over the shorter of their useful lives or the remaining lease term. We also capitalize computer software costs that meet both the definition of internal-use software and defined criteria for capitalization in accordance with ASC 350-40, Internal-Use Software. | ||||||||
Autos | 3 – 5 years | |||||||
Computers, software, machinery and equipment | 1 – 7 years | |||||||
Leasehold improvements | 1 – 10 years | |||||||
Furniture and fixtures | 3 – 15 years | |||||||
Building and improvements | 5 – 31 years | |||||||
We had $14.4 million and $13.1 million of unamortized internally developed software at December 31, 2014 and 2013, respectively. | ||||||||
Disclosures About Fair Value of Financial Instruments | ||||||||
Disclosures About Fair Value of Financial Instruments | ||||||||
The carrying amounts of our cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and other current liabilities approximate their fair values because of the short-term maturity of these instruments. The carrying amounts of our line of credit borrowings and notes payable approximate their fair values based upon the current rates offered to us for obligations of similar terms and remaining maturities. | ||||||||
Goodwill and Intangible Assets | ||||||||
Goodwill and Intangible Assets | ||||||||
Goodwill and indefinite-lived intangible assets are carried at historical cost, subject to write-down, as needed, based upon an impairment analysis that we perform annually, or sooner if an event occurs or circumstances change that would more likely than not result in an impairment loss. We perform our annual impairment test for goodwill and indefinite-lived intangible assets as of October 1 of each year. | ||||||||
Goodwill impairment is deemed to exist if the net book value of a reporting unit exceeds its estimated fair value. Events that may create an impairment include, but are not limited to, significant and sustained decline in our stock price or market capitalization, significant underperformance of operating units and significant changes in market conditions. Changes in estimates of future cash flows or changes in market values could result in a write-down of our goodwill in a future period. If an impairment loss results from any impairment analysis as described above, such loss will be recorded as a pre-tax charge to our operating income. Goodwill is allocated to various reporting units, which are generally an operating segment or one level below the operating segment. Our Commercial operating segment consists of the following reporting units: Abreon and Commercial without Abreon. | ||||||||
Goodwill impairment testing is a two-step process. Step one involves comparing the fair value of our reporting units to their carrying amount. If the fair value of the reporting unit is greater than its carrying amount, there is no impairment and no further testing is required. If the reporting unit’s carrying amount is greater than the fair value, the second step must be completed to measure the amount of impairment, if any. Step two calculates the implied fair value of goodwill by deducting the fair value of all tangible and intangible assets, excluding goodwill, of the reporting unit from the fair value of the reporting unit as determined in step one. The implied fair value of goodwill determined in this step is compared to the carrying value of goodwill. If the implied fair value of goodwill is less than the carrying value of goodwill, an impairment loss is recognized equal to the difference. | ||||||||
We performed our annual impairment analysis of goodwill and indefinite-lived intangible assets for possible impairment as of October 1, 2014. Our management, with the assistance of an independent third-party valuation firm, determined the fair values of our reporting units and their underlying assets, and compared them to their respective carrying values. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in each business combination. The carrying value of goodwill was allocated to our reporting units pursuant to ASC 350. As a result of our annual impairment analysis as of October 1, 2014, we have determined that no impairment of goodwill and other indefinite-lived intangible assets existed. | ||||||||
Fair value was determined by using a weighted combination of a market-based approach and an income approach, as this combination was deemed to be the most indicative of fair value in an orderly transaction between market participants. Under the market-based approach, we utilized information regarding our company and publicly available comparable company and industry information to determine cash flow multiples and revenue multiples that are used to value our reporting units. Under the income approach, we determined fair value based on estimated future cash flows of each reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. | ||||||||
In addition, fair value of our indefinite-lived trademark was determined using the relief from royalty method under the income approach to value. This method applies a market based royalty rate to projected revenues that are associated with the trademarks. Applying the royalty rate to projected revenues resulted in an indication of the pre-tax royalty savings associated with ownership of the trademarks. Projected after-tax royalty savings were discounted to present value at the reporting unit’s weighted average cost of capital, and a tax amortization benefit (calculated based on a 15 year life for tax purposes) was added. | ||||||||
In conjunction with our annual assessment of goodwill, our valuation techniques did not indicate any impairment as of October 1, 2014. All reporting units with goodwill passed the first step of the goodwill evaluation, with the fair values of our Abreon and Commercial without Abreon reporting units exceeding their respective carrying values by 70% and 41% and, accordingly, we were not required to perform the second step of the goodwill evaluation. There is $7.2 million and $18.3 million of goodwill residing in our Abreon and Commercial without Abreon reporting units, respectively. In applying the market and income approaches to determining fair value of our reporting units, we rely on a number of significant assumptions and estimates including revenue growth rates and operating margins, discount rates and future market conditions, among others. Our estimates are based upon assumptions we believe to be reasonable, but which by nature are uncertain and unpredictable. Changes in one or more of these significant estimates or assumptions could affect the results of these impairment reviews. | ||||||||
As part of our annual review for impairment, we assessed the total fair values of the reporting units and compared total fair value to our market capitalization at October 1, 2014, including the implied control premium, to determine if the fair values are reasonable compared to external market indicators. When comparing our market capitalization to the discounted cash flow models for each reporting unit summed together, the implied control premium was approximately 27% as of October 1, 2014. We believe several factors are contributing to our low market capitalization, including the lack of trading volume in our stock and the recent significant investments made in various parts of our business and their effects on analyst earnings models. | ||||||||
Given continuing economic uncertainties and related risks to our business, there can be no assurance that our estimates and assumptions made for purposes of our goodwill and indefinite-lived intangible assets impairment testing as of October 1, 2014 will prove to be accurate predictions of the future. We may be required to record additional goodwill impairment charges in future periods, whether in connection with our next annual impairment testing as of October 1, 2015 or prior to that, if any change constitutes a triggering event outside of the quarter from when the annual goodwill and indefinite-lived intangible assets impairment test is performed. It is not possible at this time to determine if any such future impairment charge would result or, if it does, whether such charge would be material. | ||||||||
We amortize other intangible assets with definite lives generally on a straight-line basis over their estimated useful lives. | ||||||||
Valuation of Long-Lived Assets | ||||||||
Valuation of Long-Lived Assets | ||||||||
We review long-lived assets and certain intangible assets for impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In the event the undiscounted future cash flow attributable to the asset is less than the carrying amount of the asset, an impairment loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Changes in estimates of future cash flows attributable to the long-lived assets could result in a write-down of the asset in a future period. | ||||||||
Debt Issuance Costs | ||||||||
Debt Issuance Costs | ||||||||
We defer costs incurred to obtain our credit facility and amortize these costs to interest expense using the straight-line method over the term of the respective obligation. | ||||||||
Income Taxes | ||||||||
Income Taxes | ||||||||
We account for income taxes under the assets and liability method as prescribed in accordance with ASC 740 — Income Taxes. Under this method, deferred tax assets and liabilities are recognized by applying enacted statutory tax rates applicable to future years to differences between the tax basis and financial reporting amounts of existing assets and liabilities. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We make certain estimates and judgments in determining income tax provisions and benefits, in assessing the likelihood of recovering our deferred tax assets and in evaluating our tax positions. A valuation allowance is provided when it is more likely than not that all or some portion of deferred tax assets will not be realized. In making such a determination, all available positive and negative evidence is considered, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. | ||||||||
We account for uncertainty in income taxes recognized in financial statements in accordance with ASC 740, which prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. Only tax positions that meet the more-likely-than-not recognition threshold may be recognized. We have elected to classify interest and penalties related to income tax liabilities, when applicable, as part of “Interest expense, net” in our Consolidated Statements of Operations. | ||||||||
Sales Taxes | ||||||||
Sales Taxes | ||||||||
We present sales tax we collect from our customers on a net basis (excluded from our revenues), a presentation which is prescribed as one of two methods available under ASC 605-45-50-3 (Taxes Collected from Customers and Remitted to Governmental Authorities). | ||||||||
Stock-Based Compensation | ||||||||
Stock-Based Compensation | ||||||||
We account for stock-based compensation in accordance with ASC 718 — Compensation — Stock Compensation. ASC 718 addresses the accounting for share-based payment transactions in which an enterprise receives employee services in exchange for either equity instruments of the enterprise or liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments. We record compensation expense related to stock-based compensation over the award’s requisite service period on a straight-line basis. | ||||||||
We estimate the grant date fair value of each stock option grant awarded using the Black-Scholes option pricing model and management assumptions made regarding various factors, including expected volatility of our common stock, expected life of options granted and estimated forfeiture rates, which require use of accounting judgment and financial estimates. We compute the expected term based upon an analysis of historical exercises of stock options by our employees. We compute our expected volatility using historical prices of our common stock for a period equal to the expected term of the options. The risk free interest rate is determined using the implied yield on U.S. Treasury issues with a remaining term within the contractual life of the award. We estimate an annual forfeiture rate based on our historical forfeiture data, which rate will be revised, if necessary, in future periods if actual forfeitures differ from those estimates. Any material change in the estimates used in calculating the stock-based compensation expense could result in a material impact on our results of operations. | ||||||||
Foreign Currency Translation | ||||||||
Foreign Currency Translation | ||||||||
The local currency of our foreign operations is their functional currency. The financial statements of our foreign subsidiaries are translated into U.S. dollars in accordance with ASC 830-30. Accordingly, the assets and liabilities of our Canadian and Philippine subsidiaries are translated into U.S. dollars at the exchange rate in effect at the balance sheet dates. Income and expense items are translated at the average exchange rate for each month within the year. The resulting translation adjustments are recorded in “Accumulated other comprehensive income (loss),” a separate component of stockholders’ equity on our Consolidated Balance Sheets. All transaction gains or losses are recorded in “Selling, general and administrative expenses” on our Consolidated Statements of Operations. These gains or losses were not material in any of the years presented in our consolidated financial statements. | ||||||||
Recent Accounting Pronouncements | ||||||||
Recent Accounting Pronouncements | ||||||||
In May 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which provides comprehensive guidance for revenue recognition. This ASU affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. The core principle of the guidance provides that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, using either a full retrospective or modified retrospective method of adoption. We are currently evaluating the transition method we will adopt and the impact of the adoption of ASU 2014-09 on our consolidated financial statements. | ||||||||
In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity (“ASU 2014-08”), which amended guidance on the presentation of financial statements and reporting discontinued operations and disclosures of disposals of components of an entity within property, plant and equipment. ASU 2014-08 amends the definition of a discontinued operation and requires entities to disclose additional information about disposal transactions that do not meet the discontinued-operations criteria. ASU 2014-08 is effective for disposals that occur in annual periods (and interim periods therein) beginning on or after December 15, 2014. We are currently evaluating the impact that ASU 2014-08 will have on our consolidated financial statements. | ||||||||
Basis_of_Presentation_and_Summ2
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Basis of Presentation and Summary of Significant Accounting Policies | ||||||||
Schedule of gross amounts of accounts receivable | ||||||||
The following table presents the gross amounts of our accounts receivable (in thousands): | ||||||||
At December 31, | ||||||||
2014 | 2013 | |||||||
Trade receivables | $ | 170,137 | $ | 164,594 | ||||
Vendor receivables | 24,563 | 30,241 | ||||||
Other receivables | 5,330 | 2,321 | ||||||
Total gross accounts receivable | 200,030 | 197,156 | ||||||
Less: Allowance for doubtful accounts receivable | (426 | ) | (1,407 | ) | ||||
Accounts receivable, net | $ | 199,604 | $ | 195,749 | ||||
Schedule of estimated useful lives of property and equipment | ||||||||
Autos | 3 – 5 years | |||||||
Computers, software, machinery and equipment | 1 – 7 years | |||||||
Leasehold improvements | 1 – 10 years | |||||||
Furniture and fixtures | 3 – 15 years | |||||||
Building and improvements | 5 – 31 years | |||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Stock-Based Compensation | ||||||||||||
Schedule of weighted average assumptions | ||||||||||||
Years Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Risk free interest rate | 1.79 | % | 1.13 | % | 0.97 | % | ||||||
Expected volatility | 62 | % | 74 | % | 75 | % | ||||||
Expected term (in years) | 6 | 6 | 6 | |||||||||
Expected dividend yield | None | None | None | |||||||||
Summary of stock option activity | Weighted | |||||||||||
Weighted | Average | Aggregate | ||||||||||
Average | Remaining | Intrinsic | ||||||||||
Exercise | Contractual | Value | ||||||||||
Number | Price | Term (in years) | (in thousands) | |||||||||
Outstanding at December 31, 2013 | 2,938,152 | $ | 6.69 | |||||||||
Granted | 104,000 | 10 | ||||||||||
Exercised | (827,892 | ) | 6.1 | |||||||||
Forfeited | (84,937 | ) | 6.89 | |||||||||
Expired/cancelled | (21,059 | ) | 9.25 | |||||||||
Outstanding at December 31, 2014 | 2,108,264 | 7.05 | 4.26 | $ | 5,681 | |||||||
Exercisable at December 31, 2014 | 1,680,150 | 6.94 | 3.9 | 4,758 | ||||||||
Schedule of fair value and intrinsic value of options | Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | ||||||||||
Weighted average grant-date fair value of options granted during the period | $ | 5.79 | $ | 5.19 | $ | 3.68 | ||||||
Total intrinsic value of options exercised during the period (in thousands) | 3,115 | 2,001 | 515 | |||||||||
Total fair value of shares vested during the period (in thousands) | 1,124 | 1,505 | 1,876 | |||||||||
Schedule of restricted stock units activity | ||||||||||||
Restricted Stock | Weighted Average | |||||||||||
Units | Grant Date | |||||||||||
Fair Value | ||||||||||||
Non-vested at December 31, 2013 | 85,000 | $ | 7.65 | |||||||||
Granted | 300,000 | 9.48 | ||||||||||
Vested and distributed | (21,000 | ) | 7.65 | |||||||||
Forfeited | (7,000 | ) | 7.65 | |||||||||
Non-vested at December 31, 2014 | 357,000 | 9.18 | ||||||||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property and Equipment | ||||||||
Schedule of property and equipment | ||||||||
Property and equipment consisted of the following (in thousands): | ||||||||
At December 31, | ||||||||
2014 | 2013 | |||||||
Computers, software, machinery and equipment | $ | 65,694 | $ | 64,188 | ||||
Leasehold improvements | 7,797 | 5,390 | ||||||
Furniture and fixtures | 6,020 | 4,900 | ||||||
Building and improvements | 18,674 | 10,401 | ||||||
Land | 12,007 | 12,007 | ||||||
Software development and other equipment in progress | 22,904 | 11,928 | ||||||
Subtotal | 133,096 | 108,814 | ||||||
Less: Accumulated depreciation and amortization | (58,728 | ) | (53,021 | ) | ||||
Property and equipment, net | $ | 74,368 | $ | 55,793 | ||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 12 Months Ended | |||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||
Goodwill and Intangible Assets | ||||||||||||||||||||||
Schedule of amounts recorded for intangible assets | ||||||||||||||||||||||
The following table sets forth the amounts recorded for intangible assets (in thousands): | ||||||||||||||||||||||
Weighted | At December 31, 2014 | At December 31, 2013 | ||||||||||||||||||||
Average | ||||||||||||||||||||||
Estimated | ||||||||||||||||||||||
Useful Lives | Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||
(years) | Amount | Amortization | Amount | Amount | Amortization | Amount | ||||||||||||||||
Patent, trademarks & URLs | 9 | $ | 3,593 | -1 | $ | 307 | $ | 3,286 | $ | 3,286 | -1 | $ | 271 | $ | 3,015 | |||||||
Customer relationships | 10 | 2,550 | 1,163 | 1,387 | 2,550 | 908 | 1,642 | |||||||||||||||
Non-compete agreements | — | — | — | — | 250 | 223 | 27 | |||||||||||||||
Total intangible assets | $ | 6,143 | $ | 1,470 | $ | 4,673 | $ | 6,086 | $ | 1,402 | $ | 4,684 | ||||||||||
-1 | Included in the total amount for “Patent, trademarks & URLs” at December 31, 2014 and 2013 are $2.9 million of trademarks with indefinite useful lives that are not amortized. | |||||||||||||||||||||
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Discontinued Operations | |||||||||||
Schedule of the carrying amounts of major classes of assets and liabilities of discontinued operations | |||||||||||
The carrying amounts of major classes of assets and liabilities that have been included in such balance sheet line items, as described above, in our Consolidated Balance Sheets were as follows (in thousands): | |||||||||||
At December 31, | |||||||||||
2014 | 2013 | ||||||||||
Accounts receivable, net | $ | 19 | $ | 329 | |||||||
Inventories, net | 7 | 5,517 | |||||||||
Current assets of discontinued operations | 26 | 5,846 | |||||||||
Fixed assets, net | — | 814 | |||||||||
Intangible assets, net | — | 466 | |||||||||
Other non-current assets | 14 | 19 | |||||||||
Non-current assets of discontinued operations | 14 | 1,299 | |||||||||
Total assets of discontinued operations | $ | 40 | $ | 7,145 | |||||||
Accounts payable | $ | 116 | $ | 220 | |||||||
Accrued expenses and other current liabilities | 458 | 464 | |||||||||
Deferred revenue | 3 | 29 | |||||||||
Current liabilities of discontinued operations | $ | 577 | $ | 713 | |||||||
Schedule of the operating results of discontinued operations | |||||||||||
The operating results of our discontinued operations reported in “Loss from discontinued operations, net of taxes” in our Consolidated Statements of Operations were as follows (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Net sales | $ | 29,746 | $ | 64,200 | $ | 78,561 | |||||
Loss before income taxes | $ | (2,795 | ) | $ | (887 | ) | $ | (1,034 | ) | ||
Income tax benefit | (1,225 | ) | (371 | ) | (435 | ) | |||||
Loss from discontinued operations, net of taxes | $ | (1,570 | ) | $ | (516 | ) | $ | (599 | ) | ||
Rebranding_Strategy_and_Cost_R1
Rebranding Strategy and Cost Reduction Initiatives (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Rebranding Strategy and Cost Reduction Initiatives | |||||||||||||||||
Summary of total restructuring costs by reportable operating segments | A summary of our total restructuring costs, which are included in “Selling, general and administrative expenses” on our Consolidated Statements of Operations, is as follows by each of our reportable operating segments (in thousands): | ||||||||||||||||
Commercial | Public | MacMall | Corporate | Consolidated | |||||||||||||
Sector | & | ||||||||||||||||
Other | |||||||||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
Employee termination costs | $ | 214 | $ | 34 | $ | 16 | $ | 430 | $ | 694 | |||||||
Accelerated trademark amortization costs | 916 | — | — | — | 916 | ||||||||||||
Other costs | 200 | 351 | 5 | 117 | 673 | ||||||||||||
Total | $ | 1,330 | $ | 385 | $ | 21 | $ | 547 | $ | 2,283 | |||||||
Year Ended December 31, 2012 | |||||||||||||||||
Employee termination costs | $ | 566 | $ | 19 | $ | 137 | $ | 953 | $ | 1,675 | |||||||
Accelerated trademark amortization costs | 874 | — | — | — | 874 | ||||||||||||
Other costs | — | — | — | 349 | 349 | ||||||||||||
Total | $ | 1,440 | $ | 19 | $ | 137 | $ | 1,302 | $ | 2,898 | |||||||
Summary of rollforward of our restructuring costs | |||||||||||||||||
A summary rollforward of our restructuring costs, which are recorded as part of “Accrued expenses and other current liabilities” on our Consolidated Balance Sheets, is as follows (in thousands): | |||||||||||||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2013 | to Expense | December 31, 2014 | |||||||||||||||
Employee termination costs | $ | 140 | $ | — | $ | (140 | ) | $ | — | $ | — | ||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2012 | to Expense | December 31, 2013 | |||||||||||||||
Employee termination costs | $ | 212 | $ | 694 | $ | (766 | ) | $ | — | $ | 140 | ||||||
Other costs | 43 | 673 | (716 | ) | — | — | |||||||||||
Balance as of | Costs Charged | Payments | Adjustments | Balance as of | |||||||||||||
December 31, 2011 | to Expense | December 31, 2012 | |||||||||||||||
Employee termination costs | $ | — | $ | 1,675 | $ | (1,463 | ) | $ | — | $ | 212 | ||||||
Other costs | — | 349 | (306 | ) | — | 43 | |||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Income Taxes | |||||||||||
Schedule of income before income taxes | |||||||||||
“Income from continuing operations before income taxes” in the Consolidated Statements of Operations included the following components for the periods presented (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
U.S. income | $ | 11,533 | $ | 13,774 | $ | 8,230 | |||||
Foreign income | 992 | 1,106 | 1,597 | ||||||||
Income from continuing operations before income taxes | $ | 12,525 | $ | 14,880 | $ | 9,827 | |||||
Schedule of income tax expense | |||||||||||
“Income tax expense” in the Consolidated Statements of Operations consisted of the following for the periods presented (in thousands): | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Current | |||||||||||
Federal | $ | 260 | $ | 2,920 | $ | 252 | |||||
State | 405 | 948 | 862 | ||||||||
Foreign | 613 | 828 | 104 | ||||||||
Total — Current | 1,278 | 4,696 | 1,218 | ||||||||
Deferred | |||||||||||
Federal | 3,847 | 1,595 | 2,395 | ||||||||
State | 545 | 287 | 216 | ||||||||
Foreign | (180 | ) | (343 | ) | 305 | ||||||
Total — Deferred | 4,212 | 1,539 | 2,916 | ||||||||
Income tax expense | $ | 5,490 | $ | 6,235 | $ | 4,134 | |||||
Schedule of differences in the provision for income taxes from the amount computed by applying the U.S. federal statutory rate | |||||||||||
Years Ended December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||
Expected taxes at federal statutory tax rate | 35 | % | 35 | % | 34 | % | |||||
State income taxes, net of federal income tax benefit | 7.6 | 4.4 | 8.1 | ||||||||
Change in valuation allowance | (1.9 | ) | 1.8 | 0.2 | |||||||
Non-deductible business expenses | 2.8 | 0.9 | 2.7 | ||||||||
Other | 0.3 | (0.2 | ) | (2.9 | ) | ||||||
Total | 43.8 | % | 41.9 | % | 42.1 | % | |||||
Schedule of significant components of deferred tax assets and liabilities | |||||||||||
The significant components of deferred tax assets and liabilities were as follows (in thousands): | |||||||||||
At December 31, | |||||||||||
2014 | 2013 | ||||||||||
Deferred tax assets : | |||||||||||
Accounts receivable | $ | 171 | $ | 549 | |||||||
Inventories | 128 | 305 | |||||||||
Deferred revenue | 251 | 325 | |||||||||
Accrued expenses and reserves | 2,809 | 2,135 | |||||||||
Stock based compensation | 2,844 | 3,790 | |||||||||
Tax credits and loss carryforwards | 4,514 | 2,431 | |||||||||
Other | 108 | — | |||||||||
Total gross deferred tax assets | 10,825 | 9,535 | |||||||||
Less: Valuation allowance | (805 | ) | (987 | ) | |||||||
Total deferred tax assets | 10,020 | 8,548 | |||||||||
Deferred tax liabilities: | |||||||||||
Property and equipment | (13,916 | ) | (9,792 | ) | |||||||
Intangibles | (2,604 | ) | (2,050 | ) | |||||||
Foreign employment tax subsidy | (1,550 | ) | (1,887 | ) | |||||||
Prepaid expenses | (918 | ) | (659 | ) | |||||||
Other | (153 | ) | (200 | ) | |||||||
Total deferred tax liabilities | (19,141 | ) | (14,588 | ) | |||||||
Net deferred tax liabilities | $ | (9,121 | ) | $ | (6,040 | ) | |||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||
Commitments and Contingencies | |||||||||||||||||||||||
Schedule of minimum payments over the terms of applicable contracts | |||||||||||||||||||||||
As of December 31, 2014, minimum payments over the terms of applicable contracts were payable as follows (in thousands): | |||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | |||||||||||||||||
Operating lease obligations | $ | 6,278 | $ | 4,995 | $ | 2,715 | $ | 2,367 | $ | 1,767 | $ | 4,162 | $ | 22,284 | |||||||||
Capital lease obligations | 2,310 | 1,817 | 676 | 40 | 17 | — | 4,860 | ||||||||||||||||
Other commitments (a)(b) | 18,693 | 1,269 | 95 | — | — | — | 20,057 | ||||||||||||||||
Total minimum payments | $ | 27,281 | $ | 8,081 | $ | 3,486 | $ | 2,407 | $ | 1,784 | $ | 4,162 | $ | 47,201 | |||||||||
(a) | Other commitments consist of minimum commitments under non-cancelable contracts for services relating to telecommunications, IT maintenance, financial services and employment contracts with certain employees (which consist of severance arrangements that, if exercised, would become payable in less than one year). | ||||||||||||||||||||||
(b) | We had $10.0 million of standby letters of credits (LOCs) under which there were no minimum payment requirements at December 31, 2014. LOCs are commitments issued to third party beneficiaries, underwritten by a third party bank, representing funding responsibility in the event of third party demands or contingent events. The outstanding balance of our standby LOCs reduces the amount available to us from our revolving credit facility. There were no claims made against any standby LOCs during the year ended December 31, 2014. | ||||||||||||||||||||||
Earnings_Per_Common_Share_Tabl
Earnings Per Common Share (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2014 | ||||||||||
Basic and diluted earnings (loss) per common share from continuing operations: | ||||||||||
Schedule of reconciliation of the amounts used in the basic and diluted EPS computation | ||||||||||
The reconciliation of the amounts used in the basic and diluted EPS computation was as follows for income from continuing operations (in thousands, except per share amounts): | ||||||||||
Income From | Weighted Average | Per Share | ||||||||
Continuing | Number of | Amounts | ||||||||
Operations | Common Shares | |||||||||
Outstanding | ||||||||||
Year Ended December 31, 2014: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 7,035 | 12,251 | $ | 0.57 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 630 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 7,035 | 12,881 | $ | 0.55 | |||||
Year Ended December 31, 2013: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 8,645 | 11,583 | $ | 0.75 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 340 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 8,645 | 11,923 | $ | 0.73 | |||||
Year Ended December 31, 2012: | ||||||||||
Basic EPS | ||||||||||
Income from continuing operations | $ | 5,693 | 11,989 | $ | 0.47 | |||||
Effect of dilutive securities | ||||||||||
Dilutive effect of stock-based awards | — | 171 | ||||||||
Diluted EPS | ||||||||||
Adjusted income from continuing operations | $ | 5,693 | 12,160 | $ | 0.47 | |||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Segment Information | |||||||||||||||||
Schedule of segment information for the entity's continuing operations | |||||||||||||||||
Summarized segment information for our continuing operations is as follows for the periods presented (in thousands): | |||||||||||||||||
Commercial | Public | MacMall | Corporate & | Consolidated | |||||||||||||
Sector | Other | ||||||||||||||||
Year Ended December 31, 2014 | |||||||||||||||||
Net sales | $ | 1,016,047 | $ | 214,723 | $ | 125,615 | $ | (23 | ) | $ | 1,356,362 | ||||||
Gross profit | 158,777 | 21,057 | 12,211 | 22 | 192,067 | ||||||||||||
Depreciation and amortization expense(1) | 2,416 | 45 | 116 | 8,070 | 10,647 | ||||||||||||
Operating profit | 58,029 | 8,349 | 1,290 | (51,963 | ) | 15,705 | |||||||||||
Year Ended December 31, 2013 | |||||||||||||||||
Net sales | $ | 1,034,776 | $ | 187,142 | $ | 138,089 | $ | (8 | ) | $ | 1,359,999 | ||||||
Gross profit | 158,157 | 16,995 | 14,344 | 3 | 189,499 | ||||||||||||
Depreciation and amortization expense(1) | 3,911 | 73 | 82 | 6,980 | 11,046 | ||||||||||||
Operating profit | 63,486 | 3,714 | 2,968 | (51,948 | ) | 18,220 | |||||||||||
Year Ended December 31, 2012 | |||||||||||||||||
Net sales | $ | 1,026,222 | $ | 165,828 | $ | 150,290 | $ | (42 | ) | $ | 1,342,298 | ||||||
Gross profit | 151,783 | 16,514 | 15,506 | 327 | 184,130 | ||||||||||||
Depreciation and amortization expense(1) | 4,630 | 106 | 69 | 6,768 | 11,573 | ||||||||||||
Operating profit | 59,571 | 2,554 | 4,048 | (52,555 | ) | 13,618 | |||||||||||
-1 | Primary fixed assets relating to network and servers are managed by the Corporate headquarters. As such, depreciation expense relating to such assets is included as part of Corporate & Other. | ||||||||||||||||
Schedule of location of property and equipments, net | |||||||||||||||||
Our property and equipment, net, were located in the following countries as of the periods presented (in thousands): | |||||||||||||||||
At December 31, | |||||||||||||||||
Location: | 2014 | 2013 | 2012 | ||||||||||||||
U.S. | $ | 73,784 | $ | 55,217 | $ | 45,856 | |||||||||||
Philippines | 201 | 365 | 595 | ||||||||||||||
Canada | 383 | 211 | 347 | ||||||||||||||
Property and equipment, net | $ | 74,368 | $ | 55,793 | $ | 46,798 | |||||||||||
Supplementary_Quarterly_Financ1
Supplementary Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2014 | ||||||||||||||
Supplementary Quarterly Financial Information (Unaudited) | ||||||||||||||
Schedule of quarterly financial information | ||||||||||||||
The following tables summarize supplementary quarterly financial information (in thousands, except per share data): | ||||||||||||||
2014 | ||||||||||||||
1st Quarter (1) | 2nd Quarter (1) | 3rd Quarter (1) | 4th Quarter | |||||||||||
Net sales | $ | 325,337 | $ | 334,991 | $ | 336,801 | $ | 359,233 | ||||||
Gross profit | 48,705 | 47,976 | 45,199 | 50,187 | ||||||||||
Income from continuing operations | $ | 3,034 | $ | 1,808 | $ | 139 | $ | 2,054 | ||||||
Loss from discontinued operations, net of taxes | (147 | ) | (663 | ) | (279 | ) | (481 | ) | ||||||
Net income (loss) | $ | 2,887 | $ | 1,145 | $ | (140 | ) | $ | 1,573 | |||||
Basic and diluted earnings per common share from continuing operations: | ||||||||||||||
Basic | $ | 0.25 | $ | 0.14 | $ | 0.01 | $ | 0.17 | ||||||
Diluted | 0.24 | 0.14 | 0.01 | 0.16 | ||||||||||
2013 (1) | ||||||||||||||
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | |||||||||||
Net sales | $ | 316,995 | $ | 350,002 | $ | 335,811 | $ | 357,191 | ||||||
Gross profit | 44,333 | 49,113 | 47,910 | 48,143 | ||||||||||
Income from continuing operations | $ | 1,272 | $ | 3,301 | $ | 2,129 | $ | 1,943 | ||||||
Loss from discontinued operations, net of taxes | (36 | ) | (138 | ) | (205 | ) | (137 | ) | ||||||
Net income | $ | 1,236 | $ | 3,163 | $ | 1,924 | $ | 1,806 | ||||||
Basic and diluted earnings per common share from continuing operations: | ||||||||||||||
Basic | $ | 0.11 | $ | 0.29 | $ | 0.18 | $ | 0.16 | ||||||
Diluted | 0.11 | 0.28 | 0.18 | 0.16 | ||||||||||
-1 | All amounts reported herein for the quarterly periods of 2013 and the first, second and third quarters of 2014 have been recast to present all four of our retails stores and our OnSale and eCost businesses as discontinued operations. | |||||||||||||
Description_of_Company_Details
Description of Company (Details) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
segment | segment | |
Basis of Presentation and Description of Company | ||
Number of reportable operating segments | 3 | 4 |
Commercial | ||
Basis of Presentation and Description of Company | ||
Revenue percentage | 75.00% | |
Public Sector | ||
Basis of Presentation and Description of Company | ||
Revenue percentage | 16.00% | |
MacMall | ||
Basis of Presentation and Description of Company | ||
Revenue percentage | 9.00% | |
Retail stores closed | MacMall | ||
Basis of Presentation and Description of Company | ||
Number of retail stores discontinued | 4 |
Basis_of_Presentation_and_Desc
Basis of Presentation and Description of Company (Details 2) (Immaterial error, Adjustment, USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Immaterial error | Adjustment | |
Increase purchases of property and equipment | $1.70 |
Increase borrowing under note payable | 1.7 |
Decrease non-cash purchase of property and equipment | $1.70 |
Basis_of_Presentation_and_Summ3
Basis of Presentation and Summary of Significant Accounting Policies (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Cash and Cash Equivalents | ||
Amount due from credit card processors | 2.7 | $2.50 |
Checks issued but not presented for payment to the bank, net of available cash subject to a right of offset | 1.9 | $2 |
Maximum | ||
Cash and Cash Equivalents | ||
Settlement terms of credit card receivables to be considered as cash equivalents | 5 days |
Basis_of_Presentation_and_Summ4
Basis of Presentation and Summary of Significant Accounting Policies (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Accounts Receivable | ||
Total gross accounts receivable | $200,030,000 | $197,156,000 |
Less: Allowance for doubtful accounts receivable | -426,000 | -1,407,000 |
Accounts receivable, net | 199,604,000 | 195,749,000 |
Unbilled receivables relating to vendor consideration | 13,700,000 | 15,200,000 |
Trade receivables | ||
Accounts Receivable | ||
Total gross accounts receivable | 170,137,000 | 164,594,000 |
Vendor receivables | ||
Accounts Receivable | ||
Total gross accounts receivable | 24,563,000 | 30,241,000 |
Other receivables | ||
Accounts Receivable | ||
Total gross accounts receivable | $5,330,000 | $2,321,000 |
Basis_of_Presentation_and_Summ5
Basis of Presentation and Summary of Significant Accounting Policies (Details 3) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Advertising Costs and Vendor Consideration | |||
Total net advertising expenditures | $4.30 | $4.60 | $4 |
Products manufactured by Apple | Net sales | |||
Sale of products | |||
Net sales (as a percent) | 15.00% | 17.00% | 18.00% |
Products manufactured by HP | Net sales | |||
Sale of products | |||
Net sales (as a percent) | 18.00% | 21.00% | 21.00% |
Basis_of_Presentation_and_Summ6
Basis of Presentation and Summary of Significant Accounting Policies (Details 4) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Property and Equipment | ||
Unamortized property and equipment | 133,096 | $108,814 |
Autos | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 3 years | |
Autos | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 5 years | |
Computers, software, machinery and equipment | ||
Property and Equipment | ||
Unamortized property and equipment | 65,694 | 64,188 |
Computers, software, machinery and equipment | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 1 year | |
Computers, software, machinery and equipment | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 7 years | |
Leasehold improvements | ||
Property and Equipment | ||
Unamortized property and equipment | 7,797 | 5,390 |
Leasehold improvements | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 1 year | |
Leasehold improvements | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 10 years | |
Furniture and fixtures | ||
Property and Equipment | ||
Unamortized property and equipment | 6,020 | 4,900 |
Furniture and fixtures | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 3 years | |
Furniture and fixtures | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 15 years | |
Building and improvements | ||
Property and Equipment | ||
Unamortized property and equipment | 18,674 | 10,401 |
Building and improvements | Minimum | ||
Property and Equipment | ||
Estimated useful lives | 5 years | |
Building and improvements | Maximum | ||
Property and Equipment | ||
Estimated useful lives | 31 years | |
Internally developed software | ||
Property and Equipment | ||
Unamortized property and equipment | 14,400 | $13,100 |
Basis_of_Presentation_and_Summ7
Basis of Presentation and Summary of Significant Accounting Policies (Details 5) (USD $) | 0 Months Ended | 12 Months Ended | |
Oct. 02, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Goodwill and Intangible Assets | |||
Impairment of goodwill | $0 | ||
Impairment of other indefinite-lived intangible assets | 0 | ||
Estimated life of trademarks for tax purposes to compute tax amortization used in computing fair value of indefinite-live trademarks under the royalty method | 15 years | ||
Goodwill | |||
Goodwill | 25,510,000 | 25,510,000 | |
Implied control premium (as a percent) | 27.00% | ||
Commercial without Abreon | |||
Goodwill | |||
Excess of fair values of reporting units over individual carrying values (as a percent) | 41.00% | ||
Goodwill | 18,300,000 | ||
Abreon | |||
Goodwill | |||
Excess of fair values of reporting units over individual carrying values (as a percent) | 70.00% | ||
Goodwill | $7,200,000 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stock-based compensation | |||
Number of shares available for future grants | 151,083 | ||
Stock-based compensation expense (in dollars) | $1,500,000 | $1,500,000 | $1,900,000 |
Deferred income tax benefits (in dollars) | 700,000 | 600,000 | 700,000 |
Stock options | |||
Weighted average assumptions | |||
Risk-free interest rate (as a percent) | 1.79% | 1.13% | 0.97% |
Expected volatility (as a percent) | 62.00% | 74.00% | 75.00% |
Expected term | 6 years | 6 years | 6 years |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Number | |||
Outstanding at the beginning of the period (in shares) | 2,938,152 | ||
Granted (in shares) | 104,000 | ||
Exercised (in shares) | -827,892 | ||
Forfeited (in shares) | -84,937 | ||
Expired/cancelled (in shares) | -21,059 | ||
Outstanding at the end of the period (in shares) | 2,108,264 | 2,938,152 | |
Exercisable at end of the period (in shares) | 1,680,150 | ||
Weighted Average Exercise Price | |||
Outstanding at the beginning of the period (in dollars per share) | $6.69 | ||
Granted (in dollars per share) | $10 | ||
Exercised (in dollars per share) | $6.10 | ||
Forfeited (in dollars per share) | $6.89 | ||
Expired/cancelled (in dollars per share) | $9.25 | ||
Outstanding at the end of the period (in dollars per share) | $7.05 | $6.69 | |
Exercisable at end of the period (in dollars per share) | $6.94 | ||
Weighted Average Remaining Contractual Term | |||
Outstanding at the end of the period | 4 years 3 months 4 days | ||
Exercisable at the end of the period | 3 years 10 months 24 days | ||
Aggregate Intrinsic Value | |||
Outstanding at the end of the period (in dollars) | 5,681,000 | ||
Exercisable at the end of the period (in dollars) | 4,758,000 | ||
Additional disclosures | |||
Closing price of common stock (in dollars per share) | $9.52 | ||
Weighted average grant-date fair value of options granted during the period (in dollars per share) | $5.79 | $5.19 | $3.68 |
Total intrinsic value of options exercised during the period (in thousands) | 3,115,000 | 2,001,000 | 515,000 |
Total fair value of shares vested during the period (in thousands) | 1,124,000 | 1,505,000 | 1,876,000 |
Unrecognized compensation cost | |||
Unrecognized compensation cost (in dollars) | $1,800,000 | ||
Weighted average recognition period | 2 years 10 months 28 days |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 2) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2012 | |
Weighted Average Grant Date Fair Value | |||
Granted (in dollars per share) | $7.58 | ||
Restricted Stock Units | |||
Restricted Stock Units | |||
Non-vested at the beginning of the period (in shares) | 85,000 | ||
Granted (in shares) | 300,000 | 0 | |
Vested and distributed (in shares) | -21,000 | ||
Forfeited (in shares) | -7,000 | ||
Non-vested at the end of the period (in shares) | 357,000 | ||
Weighted Average Grant Date Fair Value | |||
Non-vested at the beginning of the period (in dollars per share) | $7.65 | ||
Granted (in dollars per share) | $9.48 | ||
Vested and distributed (in dollars per share) | $7.65 | ||
Forfeited (in dollars per share) | $7.65 | ||
Non-vested at the end of the period (in dollars per share) | $9.18 |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Property and Equipment | |||
Subtotal | $133,096,000 | $108,814,000 | |
Less: Accumulated depreciation and amortization | -58,728,000 | -53,021,000 | |
Property and equipment, net | 74,368,000 | 55,793,000 | 46,798,000 |
Capitalized interest costs related to internally developed software costs during development | 600,000 | 300,000 | |
Depreciation and amortization expense for property and equipment, including fixed assets under capital leases | 10,300,000 | 9,300,000 | 9,000,000 |
Computers, software, machinery and equipment | |||
Property and Equipment | |||
Subtotal | 65,694,000 | 64,188,000 | |
Leasehold improvements | |||
Property and Equipment | |||
Subtotal | 7,797,000 | 5,390,000 | |
Furniture and fixtures | |||
Property and Equipment | |||
Subtotal | 6,020,000 | 4,900,000 | |
Building and improvements | |||
Property and Equipment | |||
Subtotal | 18,674,000 | 10,401,000 | |
Land | |||
Property and Equipment | |||
Subtotal | 12,007,000 | 12,007,000 | |
Software development and other equipment in progress | |||
Property and Equipment | |||
Subtotal | $22,904,000 | $11,928,000 |
Property_and_Equipment_Details1
Property and Equipment (Details 2) (USD $) | 1 Months Ended | 12 Months Ended | ||
31-May-13 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
acre | ||||
El Segundo Building | ||||
Purchase price of real property | $3,000,000 | $1,100,000 | ||
Area of land purchased | 7.9 | |||
Number of existing data centers | 2 | |||
Credit agreement | ||||
El Segundo Building | ||||
Amount outstanding under credit agreement | 8,900,000 | |||
Subline under revolving credit facility | ||||
El Segundo Building | ||||
Real property purchase amount financed | 1,700,000 | |||
Amount outstanding under credit agreement | 1,600,000 | |||
Real Property | ||||
El Segundo Building | ||||
Purchase price of real property | 3,000,000 | 1,100,000 | ||
Area of land purchased | 7.9 | |||
Cost incurred on construction of new cloud data center | 12,200,000 | |||
Real Property | Subline under revolving credit facility | ||||
El Segundo Building | ||||
Real property purchase amount financed | 1,700,000 | |||
Furniture and fixtures | Capital lease agreements | ||||
Capital Leases | ||||
Capital lease obligation | $500,000 | $1,300,000 | ||
Term of capital lease | 5 years | 5 years |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Goodwill | |||
Change in goodwill | $0 | $0 | $0 |
Goodwill totaled | 25,510,000 | 25,510,000 | |
Commercial | |||
Goodwill | |||
Goodwill totaled | $25,500,000 | $25,500,000 | $25,500,000 |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets (Details 2) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Intangible Assets | ||
Gross Amount | $6,143 | $6,086 |
Accumulated Amortization | 1,470 | 1,402 |
Net Amount | 4,673 | 4,684 |
Patent, trademarks & URLs | ||
Intangible Assets | ||
Weighted Average Estimated Useful Lives | 9 years | |
Gross Amount | 3,593 | 3,286 |
Accumulated Amortization | 307 | 271 |
Net Amount | 3,286 | 3,015 |
Customer relationships | ||
Intangible Assets | ||
Weighted Average Estimated Useful Lives | 10 years | |
Gross Amount | 2,550 | 2,550 |
Accumulated Amortization | 1,163 | 908 |
Net Amount | 1,387 | 1,642 |
Non-compete agreements | ||
Intangible Assets | ||
Gross Amount | 250 | |
Accumulated Amortization | 223 | |
Net Amount | $27 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets (Details 3) (Trademarks, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Trademarks | ||
Intangible assets | ||
Amount included in the total for Patents, trademarks and URLs | $2.90 | $2.90 |
Goodwill_and_Intangible_Assets5
Goodwill and Intangible Assets (Details 4) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill and Intangible Assets | |||
Total amortization expenses for intangible assets | $0.30 | $1.70 | $2.60 |
Estimated amortization expenses for intangible assets | |||
2015 | 0.3 | ||
2016 | 0.3 | ||
2017 | 0.3 | ||
2018 | 0.3 | ||
2019 | 0.3 | ||
Thereafter | $0.20 |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Carrying amounts of major classes of assets and liabilities that have been included in Condensed Consolidated Balance Sheets | |||||||||||
Current assets of discontinued operations | $26 | $5,846 | $26 | $5,846 | |||||||
Non-current assets of discontinued operations | 14 | 1,299 | 14 | 1,299 | |||||||
Current liabilities of discontinued operations | 577 | 713 | 577 | 713 | |||||||
Operating results of discontinued operations reported in "Loss from discontinued operation, net of taxes" in Condensed Consolidated Statements of Operations | |||||||||||
Loss from discontinued operations, net of taxes | -481 | -279 | -663 | -147 | -137 | -205 | -138 | -36 | -1,570 | -516 | -599 |
Discontinued Operations | |||||||||||
Discontinued Operations | |||||||||||
Number of retail stores discontinued | 4 | ||||||||||
Carrying amounts of major classes of assets and liabilities that have been included in Condensed Consolidated Balance Sheets | |||||||||||
Accounts receivable, net | 19 | 329 | 19 | 329 | |||||||
Inventories, net | 7 | 5,517 | 7 | 5,517 | |||||||
Current assets of discontinued operations | 26 | 5,846 | 26 | 5,846 | |||||||
Fixed assets, net | 814 | 814 | |||||||||
Intangible assets, net | 466 | 466 | |||||||||
Other non-current assets | 14 | 19 | 14 | 19 | |||||||
Non-current assets of discontinued operations | 14 | 1,299 | 14 | 1,299 | |||||||
Total assets of discontinued operations | 40 | 7,145 | 40 | 7,145 | |||||||
Accounts payable | 116 | 220 | 116 | 220 | |||||||
Accrued expenses and other current liabilities | 458 | 464 | 458 | 464 | |||||||
Deferred revenue | 3 | 29 | 3 | 29 | |||||||
Current liabilities of discontinued operations | 577 | 713 | 577 | 713 | |||||||
Operating results of discontinued operations reported in "Loss from discontinued operation, net of taxes" in Condensed Consolidated Statements of Operations | |||||||||||
Net sales | 29,746 | 64,200 | 78,561 | ||||||||
Loss before income taxes | -2,795 | -887 | -1,034 | ||||||||
Income tax benefit | -1,225 | -371 | -435 | ||||||||
Loss from discontinued operations, net of taxes | ($1,570) | ($516) | ($599) |
Rebranding_Strategy_and_Cost_R2
Rebranding Strategy and Cost Reduction Initiatives (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Rebranding strategy and cost reduction initiatives | |||
Approximate entity size (annual sales) | $1,400,000,000 | ||
Severance and restructuring related expenses | 0 | 2,283,000 | 2,898,000 |
Commercial | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 1,330,000 | 1,440,000 | |
Public Sector | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 385,000 | 19,000 | |
MacMall | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 21,000 | 137,000 | |
Corporate and Other | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 547,000 | 1,302,000 | |
Employee termination costs | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 694,000 | 1,675,000 | |
Summary of rollforward of restructuring costs | |||
Balance at the beginning of the period | 140,000 | 212,000 | |
Costs Charged to Expense | 694,000 | 1,675,000 | |
Payments | -140,000 | -766,000 | -1,463,000 |
Balance at the end of the period | 140,000 | 212,000 | |
Employee termination costs | Commercial | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 214,000 | 566,000 | |
Employee termination costs | Public Sector | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 34,000 | 19,000 | |
Employee termination costs | MacMall | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 16,000 | 137,000 | |
Employee termination costs | Corporate and Other | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 430,000 | 953,000 | |
Accelerated trademark amortization costs | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 916,000 | 874,000 | |
Accelerated trademark amortization costs | Commercial | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 916,000 | 874,000 | |
Other costs | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 673,000 | 349,000 | |
Summary of rollforward of restructuring costs | |||
Balance at the beginning of the period | 43,000 | ||
Costs Charged to Expense | 673,000 | 349,000 | |
Payments | -716,000 | -306,000 | |
Balance at the end of the period | 43,000 | ||
Other costs | Commercial | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 200,000 | ||
Other costs | Public Sector | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 351,000 | ||
Other costs | MacMall | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | 5,000 | ||
Other costs | Corporate and Other | |||
Rebranding strategy and cost reduction initiatives | |||
Severance and restructuring related expenses | $117,000 | $349,000 |
Line_of_Credit_and_Note_Payabl1
Line of Credit and Note Payable (Details) (USD $) | 9 Months Ended | 12 Months Ended | 1 Months Ended | ||||
Sep. 30, 2014 | Dec. 31, 2014 | Jun. 30, 2011 | 31-May-13 | Jul. 31, 2013 | Dec. 31, 2013 | Mar. 22, 2013 | |
item | acre | ||||||
Line of Credit and Notes Payable | |||||||
Net working capital advances outstanding | $52,795,000 | $110,499,000 | |||||
Additional disclosures | |||||||
Purchase price of real property | 3,000,000 | 1,100,000 | |||||
Area of land purchased | 7.9 | ||||||
Additional costs incurred for construction of a new cloud data center | 12,200,000 | ||||||
Number of existing data centers | 2 | ||||||
Asset-based revolving credit facility | |||||||
Line of Credit and Notes Payable | |||||||
Credit limit | 200,000,000 | ||||||
Unused line fee (as a percent) | 0.25% | ||||||
Fixed charge coverage ratio | 1 | ||||||
Number of trailing fiscal quarters used in calculating the fixed charge coverage ratio under debt covenants | 4 | ||||||
Net working capital advances outstanding | 52,800,000 | ||||||
Amount available to borrow for working capital advances | 89,500,000 | ||||||
Additional disclosures | |||||||
Effective weighted average annual interest rate (as a percent) | 2.31% | ||||||
Term note | |||||||
Line of Credit and Notes Payable | |||||||
Principal balance of debt | 4,340,000 | ||||||
Equal monthly principal installments | 52,000 | ||||||
Principal repayment amortization period | 84 months | ||||||
Outstanding amount of debt | 3,300,000 | ||||||
Maturities of remaining balance of term note | |||||||
2015 | 600,000 | ||||||
2016 | 600,000 | ||||||
2017 | 600,000 | ||||||
2018 | 600,000 | ||||||
2019 | 600,000 | ||||||
Thereafter | 200,000 | ||||||
Additional disclosures | |||||||
Effective weighted average annual interest rate (as a percent) | 2.31% | ||||||
Credit agreement | |||||||
Line of Credit and Notes Payable | |||||||
Principal repayment amortization period | 25 years | ||||||
Maturities of remaining balance of term note | |||||||
2015 | 400,000 | ||||||
2016 | 8,500,000 | ||||||
Additional disclosures | |||||||
Borrowing term | 5 years | ||||||
Amount outstanding under credit agreement | 8,900,000 | ||||||
Credit agreement | Prime rate | |||||||
Additional disclosures | |||||||
Variable interest rate basis | Prime | ||||||
Percentage points added to the reference rate | 0.38% | ||||||
Credit agreement | LIBOR | |||||||
Additional disclosures | |||||||
Variable interest rate basis | LIBOR | ||||||
Percentage points added to the reference rate | 2.38% | ||||||
Subline under revolving credit facility | |||||||
Line of Credit and Notes Payable | |||||||
Principal repayment amortization period | 84 months | ||||||
Maturities of remaining balance of term note | |||||||
2015 | 300,000 | ||||||
2016 | 300,000 | ||||||
2017 | 300,000 | ||||||
2018 | 300,000 | ||||||
2019 | 300,000 | ||||||
Thereafter | 100,000 | ||||||
Additional disclosures | |||||||
Real property purchase amount financed | 1,700,000 | ||||||
Monthly principal amortization amount | 24,000 | ||||||
Amount outstanding under credit agreement | 1,600,000 | ||||||
Financing Arrangements For ERP Upgrage | |||||||
Line of Credit and Notes Payable | |||||||
Number of financing arrangements entered | 3 | ||||||
Principal balance of debt | 5,600,000 | ||||||
Outstanding amount of debt | 4,500,000 | ||||||
Maturities of remaining balance of term note | |||||||
2015 | 2,000,000 | ||||||
2016 | 2,000,000 | ||||||
2017 | 500,000 | ||||||
Loan agreement to finance build out of new data center | |||||||
Line of Credit and Notes Payable | |||||||
Principal repayment amortization period | 25 years | ||||||
Maturities of remaining balance of term note | |||||||
2015 | 300,000 | ||||||
2016 | 300,000 | ||||||
2017 | 300,000 | ||||||
2018 | 300,000 | ||||||
2019 | 300,000 | ||||||
Thereafter | 6,200,000 | ||||||
Additional disclosures | |||||||
Borrowing term | 5 years | ||||||
Amount outstanding under credit agreement | 7,725,000 | ||||||
Loan agreement to finance build out of new data center | Maximum | |||||||
Line of Credit and Notes Payable | |||||||
Principal balance of debt | 7,725,000 | ||||||
Loan agreement to finance build out of new data center | Prime rate | |||||||
Additional disclosures | |||||||
Variable interest rate basis | prime | ||||||
Percentage points added to the reference rate | 0.25% | ||||||
Loan agreement to finance build out of new data center | LIBOR | |||||||
Additional disclosures | |||||||
Variable interest rate basis | LIBOR | ||||||
Percentage points added to the reference rate | 2.25% | ||||||
Notes payable | |||||||
Additional disclosures | |||||||
Effective weighted average annual interest rate (as a percent) | 2.31% |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Components of deferred tax assets and liabilities | |||
Accounts receivable | $171,000 | $549,000 | |
Inventories | 128,000 | 305,000 | |
Deferred revenue | 251,000 | 325,000 | |
Accrued expenses and reserves | 2,809,000 | 2,135,000 | |
Stock based compensation | 2,844,000 | 3,790,000 | |
Tax credits and loss carryforwards | 4,514,000 | 2,431,000 | |
Other | 108,000 | ||
Total gross deferred tax assets | 10,825,000 | 9,535,000 | |
Less: Valuation allowance | -805,000 | -987,000 | |
Total deferred tax assets | 10,020,000 | 8,548,000 | |
Deferred tax liabilities: | |||
Property and equipment | -13,916,000 | -9,792,000 | |
Intangibles | -2,604,000 | -2,050,000 | |
Foreign employment tax subsidy | -1,550,000 | -1,887,000 | |
Prepaid expenses | -918,000 | -659,000 | |
Other | -153,000 | -200,000 | |
Total deferred tax liabilities | -19,141,000 | -14,588,000 | |
Net deferred tax liabilities | -9,121,000 | -6,040,000 | |
Income before income taxes in the Consolidated Statements of Operations | |||
U.S. income | 11,533,000 | 13,774,000 | 8,230,000 |
Foreign income | 992,000 | 1,106,000 | 1,597,000 |
Income from continuing operations before income taxes | 12,525,000 | 14,880,000 | 9,827,000 |
Increase in valuation allowance due to increase in state deferred tax assets of loss subsidiaries | 200,000 | ||
Deferred | |||
Deferred Income Tax Expense (Benefit), Total | 2,987,000 | 1,539,000 | 2,565,000 |
Income Tax Expense (Benefit), Total | 5,490,000 | 6,235,000 | 4,134,000 |
Differences in the provision for income taxes from the amount computed by applying the U.S. federal statutory rate | |||
Expected taxes at federal statutory tax rate (as a percent) | 35.00% | 35.00% | 34.00% |
State income taxes, net of federal income tax benefit (as a percent) | 7.60% | 4.40% | 8.10% |
Change in valuation allowance (as a percent) | -1.90% | 1.80% | 0.20% |
Non-deductible business expenses (as a percent) | 2.80% | 0.90% | 2.70% |
Other (as a percent) | 0.30% | -0.20% | -2.90% |
Total (as a percent) | 43.80% | 41.90% | 42.10% |
Continuing operations | |||
Current | |||
Federal | 260,000 | 2,920,000 | 252,000 |
State | 405,000 | 948,000 | 862,000 |
Foreign | 613,000 | 828,000 | 104,000 |
Total - Current | 1,278,000 | 4,696,000 | 1,218,000 |
Deferred | |||
Federal | 3,847,000 | 1,595,000 | 2,395,000 |
State | 545,000 | 287,000 | 216,000 |
Foreign | -180,000 | -343,000 | 305,000 |
Deferred Income Tax Expense (Benefit), Total | 4,212,000 | 1,539,000 | 2,916,000 |
Income Tax Expense (Benefit), Total | 5,490,000 | 6,235,000 | 4,134,000 |
Accrued expenses and other current liabilities | |||
Deferred tax liabilities: | |||
Foreign employment tax subsidy | ($800,000) | ($1,000,000) |
Income_Taxes_Details_2
Income Taxes (Details 2) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Operating loss carryforwards | ||
Unrecognized tax positions | $0 | |
Accrued interest and penalties | 0 | 0 |
State | ||
Operating loss carryforwards | ||
Net operating loss carryforwards expiring between 2016 and 2019 | 2.2 | |
Net operating loss carryforwards | 31.7 | |
State | Pre-acquisition losses from an acquired subsidiary | ||
Operating loss carryforwards | ||
Net operating loss carryforwards | 1.1 | |
Federal | ||
Operating loss carryforwards | ||
Net operating loss carryforwards | 8.8 | |
Federal | Pre-acquisition losses from an acquired subsidiary | ||
Operating loss carryforwards | ||
Net operating loss carryforwards | 2.7 | |
Canada | ||
Operating loss carryforwards | ||
Deferred taxes on cumulative undistributed earnings of subsidiary | 0 | |
Cumulative undistributed earnings of subsidiary | $12.60 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Minimum payments over the terms of applicable contracts | |||
2015 | $27,281,000 | ||
2016 | 8,081,000 | ||
2017 | 3,486,000 | ||
2018 | 2,407,000 | ||
2019 | 1,784,000 | ||
Thereafter | 4,162,000 | ||
Total minimum payments | 47,201,000 | ||
Total rent expense under operating leases, net of sublease income | 4,600,000 | 4,900,000 | 4,800,000 |
Operating lease obligations | |||
Minimum payments over the terms of applicable contracts | |||
2015 | 6,278,000 | ||
2016 | 4,995,000 | ||
2017 | 2,715,000 | ||
2018 | 2,367,000 | ||
2019 | 1,767,000 | ||
Thereafter | 4,162,000 | ||
Total minimum payments | 22,284,000 | ||
Capital lease agreements | |||
Minimum payments over the terms of applicable contracts | |||
2015 | 2,310,000 | ||
2016 | 1,817,000 | ||
2017 | 676,000 | ||
2018 | 40,000 | ||
2019 | 17,000 | ||
Total minimum payments | 4,860,000 | ||
Other commitments | |||
Minimum payments over the terms of applicable contracts | |||
2015 | 18,693,000 | ||
2016 | 1,269,000 | ||
2017 | 95,000 | ||
Total minimum payments | 20,057,000 | ||
Other commitments | Maximum | |||
Commitments and Contingencies | |||
Period over which commitments become payable on exercise of severance arrangements | 1 year | ||
Standby Letters of Credit | |||
Minimum payments over the terms of applicable contracts | |||
Total minimum payments | 10,000,000 | ||
Claims made | $0 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 1 Months Ended | 12 Months Ended | 63 Months Ended | |||
Sep. 30, 2012 | Oct. 31, 2008 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | |
Stockholders' Equity | ||||||
Increase in maximum amount approved under common stock repurchase program | $10,000,000 | |||||
Maximum amount authorized under the common stock repurchase program | 10,000,000 | |||||
Shares of common stock repurchased | 228,771 | 3,074,486 | ||||
Aggregate cost of shares of common stock repurchased | 2,151,000 | 1,633,000 | 3,910,000 | 16,500,000 | ||
Available authorized repurchase amount | $3,500,000 |
Earnings_Per_Common_Share_Deta
Earnings Per Common Share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Basic and diluted earnings (loss) per common share from continuing operations: | |||||||||||
Shares of common stock underlying stock options excluded from the calculation of diluted EPS | 562,000 | 657,000 | 1,775,000 | ||||||||
Basic EPS | |||||||||||
Income from continuing operations | $2,054 | $139 | $1,808 | $3,034 | $1,943 | $2,129 | $3,301 | $1,272 | $7,035 | $8,645 | $5,693 |
Shares | 12,251,000 | 11,583,000 | 11,989,000 | ||||||||
Per Share Amounts (in dollars per share) | $0.57 | $0.75 | $0.47 | ||||||||
Effect of dilutive securities - Dilutive effect of stock - based awards | |||||||||||
Shares | 630,000 | 340,000 | 171,000 | ||||||||
Diluted EPS - Adjusted net income | |||||||||||
Adjusted income from continuing operations | $2,054 | $139 | $1,808 | $3,034 | $1,943 | $2,129 | $3,301 | $1,272 | $7,035 | $8,645 | $5,693 |
Shares | 12,881,000 | 11,923,000 | 12,160,000 | ||||||||
Per Share Amounts (in dollars per share) | $0.55 | $0.73 | $0.47 |
Employee_NonEmployee_Benefits_
Employee & Non-Employee Benefits (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 25, 2012 | Sep. 15, 2011 | 20-May-14 | 20-May-13 | |
item | |||||||
401(k) Savings Plan | |||||||
Matching contributions by employer (as a percent) | 25.00% | ||||||
Maximum Percentage of participants' compensation for which matching contributions are made | 4.00% | ||||||
Vesting period of matched contributions to employees | 5 years | ||||||
Matching contribution to the plan | $545,000 | $530,000 | $519,000 | ||||
Stock options | |||||||
Restricted Stock, Stock Warrants and Options Issued to Non-employees | |||||||
Granted (in shares) | 104,000 | ||||||
Exercise price (in dollars per share) | $10 | ||||||
Stock options | Non-employee member of the board | |||||||
Restricted Stock, Stock Warrants and Options Issued to Non-employees | |||||||
Granted (in shares) | 10,000 | 10,000 | |||||
Exercise price (in dollars per share) | $5.44 | $6.24 | |||||
Vesting period | 2 years | 2 years | |||||
Expiration term | 10 years | 7 years | |||||
Restricted Stock Units | |||||||
Restricted Stock, Stock Warrants and Options Issued to Non-employees | |||||||
Granted (in shares) | 36,000 | ||||||
Restricted Stock Units | Non-employee member of the board | |||||||
Restricted Stock, Stock Warrants and Options Issued to Non-employees | |||||||
Granted (in shares) | 6,000 | 6,000 | |||||
Vesting period | 2 years | 2 years | |||||
Number of non-employee members | 3 | 3 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
segment | segment | ||||||||||
Segment Information | |||||||||||
Number of Operating Segments | 3 | 4 | |||||||||
Segment Information | |||||||||||
Net sales | $359,233 | $336,801 | $334,991 | $325,337 | $357,191 | $335,811 | $350,002 | $316,995 | $1,356,362 | $1,359,999 | $1,342,298 |
Gross profit | 50,187 | 45,199 | 47,976 | 48,705 | 48,143 | 47,910 | 49,113 | 44,333 | 192,067 | 189,499 | 184,130 |
Depreciation and amortization expense | 11,893 | 11,830 | 12,496 | ||||||||
Operating profit | 15,705 | 18,220 | 13,618 | ||||||||
Total consolidated assets | 389,190 | 434,822 | 389,190 | 434,822 | |||||||
Commercial | |||||||||||
Segment Information | |||||||||||
Net sales | 1,016,047 | 1,034,776 | 1,026,222 | ||||||||
Gross profit | 158,777 | 158,157 | 151,783 | ||||||||
Depreciation and amortization expense | 2,416 | 3,911 | 4,630 | ||||||||
Operating profit | 58,029 | 63,486 | 59,571 | ||||||||
Public Sector | |||||||||||
Segment Information | |||||||||||
Net sales | 214,723 | 187,142 | 165,828 | ||||||||
Gross profit | 21,057 | 16,995 | 16,514 | ||||||||
Depreciation and amortization expense | 45 | 73 | 106 | ||||||||
Operating profit | 8,349 | 3,714 | 2,554 | ||||||||
MacMall | |||||||||||
Segment Information | |||||||||||
Net sales | 125,615 | 138,089 | 150,290 | ||||||||
Gross profit | 12,211 | 14,344 | 15,506 | ||||||||
Depreciation and amortization expense | 116 | 82 | 69 | ||||||||
Operating profit | 1,290 | 2,968 | 4,048 | ||||||||
Corporate and Other | |||||||||||
Segment Information | |||||||||||
Net sales | -23 | -8 | -42 | ||||||||
Gross profit | 22 | 3 | 327 | ||||||||
Depreciation and amortization expense | 8,070 | 6,980 | 6,768 | ||||||||
Operating profit | -51,963 | -51,948 | -52,555 | ||||||||
Continuing operations | |||||||||||
Segment Information | |||||||||||
Net sales | 1,356,362 | 1,359,999 | 1,342,298 | ||||||||
Gross profit | 192,067 | 189,499 | 184,130 | ||||||||
Depreciation and amortization expense | 10,647 | 11,046 | 11,573 | ||||||||
Operating profit | $15,705 | $18,220 | $13,618 |
Segment_Information_Details_2
Segment Information (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment Information | |||
Maximum percentage of total net sales made to customers outside of the continental U.S | 1.00% | 1.00% | 1.00% |
Location of property and equipments, net | |||
Property, Plant and Equipment, Net | $74,368 | $55,793 | $46,798 |
U.S. | |||
Location of property and equipments, net | |||
Property, Plant and Equipment, Net | 73,784 | 55,217 | 45,856 |
Philippines | |||
Location of property and equipments, net | |||
Property, Plant and Equipment, Net | 201 | 365 | 595 |
Canada | |||
Location of property and equipments, net | |||
Property, Plant and Equipment, Net | $383 | $211 | $347 |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 13, 2015 | Mar. 13, 2015 | Jan. 15, 2015 | |
acre | ||||||
Subsequent Event | ||||||
Cash paid on purchase of property | $26,666,000 | $17,213,000 | $9,446,000 | |||
Area of Land | 7.9 | |||||
Subsequent Events | En Pointe Technologies Sales Inc | ||||||
Subsequent Event | ||||||
Initial purchase price | 15,000,000 | |||||
Gross profit and service revenues target period | 3 years | |||||
Adjusted gross profit (in percentage) | 22.50% | |||||
Service revenue (in percentage) | 10.00% | |||||
Subsequent Events | Sarcom Properties, Inc | ||||||
Subsequent Event | ||||||
Purchase price | 6,600,000 | |||||
Cash paid on purchase of property | 2,200,000 | |||||
Area of Land | 12.4 | |||||
Subsequent Events | Sarcom Properties, Inc | Long Term Notes | ||||||
Subsequent Event | ||||||
Amount outstanding under credit agreement | $4,575,000 | |||||
Borrowing term | 5 years | |||||
Principal repayment amortization period | 25 years | |||||
Variable interest rate basis | LIBOR | |||||
Percentage points added to the reference rate | 2.25% | |||||
Subsequent Events | Sarcom Properties, Inc | Building and real property located in Ohio | ||||||
Subsequent Event | ||||||
Building space in square feet | 144,000 |
Supplementary_Quarterly_Financ2
Supplementary Quarterly Financial Information (Unaudited) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Supplementary Quarterly Financial Information (Unaudited) | |||||||||||
Net sales | $359,233 | $336,801 | $334,991 | $325,337 | $357,191 | $335,811 | $350,002 | $316,995 | $1,356,362 | $1,359,999 | $1,342,298 |
Gross profit | 50,187 | 45,199 | 47,976 | 48,705 | 48,143 | 47,910 | 49,113 | 44,333 | 192,067 | 189,499 | 184,130 |
Income (loss) from continuing operations | 2,054 | 139 | 1,808 | 3,034 | 1,943 | 2,129 | 3,301 | 1,272 | 7,035 | 8,645 | 5,693 |
Loss from discontinued operations, net of taxes | -481 | -279 | -663 | -147 | -137 | -205 | -138 | -36 | -1,570 | -516 | -599 |
Net income (loss) | $1,573 | ($140) | $1,145 | $2,887 | $1,806 | $1,924 | $3,163 | $1,236 | $5,465 | $8,129 | $5,094 |
Basic and Diluted Earnings Per Common Share | |||||||||||
Basic (in dollars per share) | $0.17 | $0.01 | $0.14 | $0.25 | $0.16 | $0.18 | $0.29 | $0.11 | $0.45 | $0.70 | $0.42 |
Diluted (in dollars per share) | $0.16 | $0.01 | $0.14 | $0.24 | $0.16 | $0.18 | $0.28 | $0.11 | $0.42 | $0.68 | $0.42 |
SCHEDULE_II_VALUATION_AND_QUAL1
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Allowance for doubtful accounts | |||
Changes in valuation and qualifying accounts | |||
Balance at Beginning of Year | $1,407 | $1,447 | $1,622 |
Additions Charged to Operations | 463 | 1,361 | 830 |
Deduction from Reserves | -1,444 | -1,401 | -1,005 |
Balance at End of Year | 426 | 1,407 | 1,447 |
Valuation allowance for deferred tax assets | |||
Changes in valuation and qualifying accounts | |||
Balance at Beginning of Year | 987 | 737 | 719 |
Additions Charged to Operations | 43 | 293 | 131 |
Deduction from Reserves | -225 | -43 | -113 |
Balance at End of Year | $805 | $987 | $737 |