Cover Page
Cover Page - shares | 3 Months Ended | |
Jun. 30, 2019 | Jul. 31, 2019 | |
Cover page. | ||
Entity Central Index Key | 0000939930 | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-13684 | |
Entity Registrant Name | Pyxus International, Inc. | |
Entity Incorporation, State or Country Code | VA | |
Entity Tax Identification Number | 54-1746567 | |
Entity Address, Address Line One | 8001 Aerial Center Parkway | |
Entity Address, City or Town | Morrisville | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 27560 | |
City Area Code | 919 | |
Local Phone Number | 379-4300 | |
Title of 12(b) Security | Common Stock (no par value) | |
Trading Symbol | PYX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 9,137,812 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||
Sales and other operating revenues | $ 276,670 | $ 290,989 |
Cost of goods and services sold | 236,958 | 249,594 |
Gross profit | 39,712 | 41,395 |
Selling, general, and administrative expenses | 49,377 | 38,084 |
Other income, net | 2,948 | 2,921 |
Restructuring and asset impairment charges | 212 | 1,541 |
Operating (loss) income | (6,929) | 4,691 |
Debt retirement expense (benefit) | 0 | (84) |
Interest expense (includes debt amortization of $2,208 and $2,329 for 2019 and 2018, respectively) | 33,812 | 32,912 |
Interest income | 1,154 | 888 |
Loss before income taxes and other items | (39,587) | (27,249) |
Income tax expense (benefit) | 23,453 | (25,270) |
Equity in net income of investee companies | 877 | 566 |
Net loss | (62,163) | (1,413) |
Net loss attributable to noncontrolling interests | (366) | (654) |
Net loss attributable to Pyxus International, Inc. | $ (61,797) | $ (759) |
Loss per share: | ||
Basic (USD per share) | $ (6.79) | $ (0.08) |
Diluted (USD per share) | $ (6.79) | $ (0.08) |
Weighted average number of shares outstanding: | ||
Basic (shares) | 9,100 | 9,027 |
Diluted (shares) | 9,100 | 9,027 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||
Debt amortization | $ 2,208 | $ 2,329 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (62,163) | $ (1,413) |
Other comprehensive income (loss), net of tax: | ||
Currency translation adjustment | (400) | (5,311) |
Defined benefit pension amounts reclassified to income | 311 | 366 |
Change in the fair value of derivatives designated as cash flow hedges | (145) | (1,496) |
Amounts reclassified to income for derivatives | 514 | 0 |
Total other comprehensive income (loss), net of tax | 280 | (6,441) |
Total comprehensive loss | (61,883) | (7,854) |
Comprehensive loss attributable to noncontrolling interests | (336) | (829) |
Comprehensive loss attributable to Pyxus International, Inc. | $ (61,547) | $ (7,025) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Current assets | |||
Cash and cash equivalents | $ 164,135 | $ 192,043 | $ 202,107 |
Restricted cash | 3,137 | 5,378 | 2,374 |
Trade receivables, net | 193,076 | 290,097 | 196,834 |
Other receivables | 10,522 | 20,900 | 13,939 |
Accounts receivable, related parties | 17,239 | 5,783 | 12,375 |
Inventories | 817,663 | 668,171 | 916,928 |
Advances to tobacco suppliers | 41,264 | 19,754 | 67,983 |
Recoverable income taxes | 8,182 | 5,421 | 33,058 |
Prepaid expenses | 20,448 | 15,934 | 22,356 |
Other current assets | 15,156 | 15,027 | 17,635 |
Total current assets | 1,290,822 | 1,238,508 | 1,485,589 |
Restricted cash | 389 | 389 | 389 |
Investments in unconsolidated affiliates | 64,535 | 69,459 | 67,898 |
Goodwill | 34,547 | 34,336 | 34,487 |
Other intangible assets | 70,778 | 71,781 | 74,322 |
Deferred income taxes, net | 113,666 | 116,451 | 144,389 |
Long-term recoverable income taxes | 2,638 | 3,067 | 898 |
Other deferred charges | 2,340 | 2,175 | 3,554 |
Other noncurrent assets | 51,505 | 46,713 | 62,973 |
Right-of-use assets | 45,969 | 0 | 0 |
Property, plant, and equipment, net | 288,386 | 276,396 | 254,867 |
Total assets | 1,965,575 | 1,859,275 | 2,129,366 |
Current liabilities | |||
Notes payable to banks | 520,828 | 428,961 | 580,221 |
Accounts payable | 85,060 | 87,049 | 83,144 |
Accounts payable, related parties | 20,773 | 19,054 | 23,008 |
Advances from customers | 18,779 | 16,436 | 16,646 |
Accrued expenses and other current liabilities | 104,392 | 91,282 | 99,356 |
Income taxes payable | 18,314 | 3,728 | 13,718 |
Operating leases payable | 15,275 | 0 | 0 |
Current portion of long-term debt | 334 | 332 | 180 |
Total current liabilities | 783,755 | 646,842 | 816,273 |
Long-term taxes payable | 8,660 | 10,718 | 9,155 |
Long-term debt | 899,672 | 898,386 | 910,635 |
Deferred income taxes | 33,668 | 26,813 | 29,720 |
Liability for unrecognized tax benefits | 8,544 | 11,189 | 8,917 |
Long-term leases | 28,876 | 0 | 0 |
Pension, postretirement, and other long-term liabilities | 71,835 | 73,308 | 73,866 |
Total liabilities | 1,835,010 | 1,667,256 | 1,848,566 |
Commitments and contingencies | |||
Common Stock—no par value: | |||
Authorized shares (shares) | 250,000,000 | 250,000,000 | 250,000,000 |
Issued shares (shares) | 9,917,000 | 9,881,000 | 9,834,000 |
Issued shares | $ 469,365 | $ 468,936 | $ 473,771 |
Retained deficit | (285,681) | (223,884) | (157,107) |
Accumulated other comprehensive loss | (61,092) | (61,342) | (51,528) |
Total stockholders’ equity of Pyxus International, Inc. | 122,592 | 183,710 | 265,136 |
Noncontrolling interests | 7,973 | 8,309 | 15,664 |
Total stockholders’ equity | 130,565 | 192,019 | 280,800 |
Total liabilities and stockholders’ equity | $ 1,965,575 | $ 1,859,275 | $ 2,129,366 |
Condensed Statements of Consoli
Condensed Statements of Consolidated Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Retained Deficit | Currency Translation Adjustment | Pensions, Net of Tax | Loss on Derivatives, Net of Tax | Noncontrolling Interests |
Balance at beginning of period at Mar. 31, 2018 | $ 282,828 | $ 473,476 | $ (156,348) | $ (12,682) | $ (32,580) | $ 0 | $ 10,962 |
Statement of Consolidated Stockholders' Equity | |||||||
Net loss | (1,413) | (759) | (654) | ||||
Stock-based compensation | 295 | 295 | |||||
Purchase of investment in subsidiary | 5,531 | 5,531 | |||||
Other comprehensive (loss) income, net of tax | (6,441) | (5,136) | 366 | (1,496) | (175) | ||
Balance at end of period at Jun. 30, 2018 | 280,800 | 473,771 | (157,107) | (17,818) | (32,214) | (1,496) | 15,664 |
Balance at beginning of period at Mar. 31, 2019 | 192,019 | 468,936 | (223,884) | (21,979) | (36,749) | (2,614) | 8,309 |
Statement of Consolidated Stockholders' Equity | |||||||
Net loss | (62,163) | (61,797) | (366) | ||||
Stock-based compensation | 429 | 429 | |||||
Other comprehensive (loss) income, net of tax | 280 | (430) | 311 | 369 | 30 | ||
Balance at end of period at Jun. 30, 2019 | $ 130,565 | $ 469,365 | $ (285,681) | $ (22,409) | $ (36,438) | $ (2,245) | $ 7,973 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Operating Activities: | ||
Net loss | $ (62,163) | $ (1,413) |
Adjustments to reconcile net loss to net cash used by operating activities: | ||
Depreciation and amortization | 8,810 | 9,277 |
Debt amortization/interest | 2,818 | 2,894 |
Debt retirement benefit | 0 | (84) |
Gain on foreign currency transactions | (2,232) | (1,478) |
Restructuring and asset impairment charges | 212 | 1,541 |
Loss (gain) on sale of property, plant, and equipment | 78 | (186) |
Equity in net income of unconsolidated affiliates, net of dividends | 5,328 | (431) |
Bad debt expense | 0 | 293 |
Stock-based compensation | 429 | 295 |
Changes in operating assets and liabilities, net | (119,919) | (278,023) |
Other, net | (3,283) | (5,793) |
Net cash used by operating activities | (169,922) | (273,108) |
Investing Activities: | ||
Purchases of property, plant, and equipment | (19,344) | (8,047) |
Proceeds from sale of property, plant, and equipment | 224 | 219 |
Collections on beneficial interests on securitized trade receivables | 72,266 | 76,241 |
Payments to acquire controlling interests, net of cash acquired | 0 | (8,692) |
Other, net | (543) | (300) |
Net cash provided by investing activities | 52,603 | 59,421 |
Financing Activities: | ||
Net proceeds from short-term borrowings | 92,524 | 163,951 |
Repayment of long-term borrowings | (85) | (10,721) |
Debt issuance cost | (3,368) | (4,851) |
Debt retirement cost | 0 | 27 |
Net cash provided by financing activities | 89,071 | 148,352 |
Effect of exchange rate changes on cash | (1,901) | 2,172 |
Decrease in cash, cash equivalents, and restricted cash | (30,149) | (63,163) |
Cash and cash equivalents at beginning of period | 192,043 | 264,660 |
Restricted cash at beginning of period | 5,767 | 3,373 |
Cash, cash equivalents, and restricted cash at end of period | 167,661 | 204,870 |
Other information: | ||
Cash paid for income taxes | 5,222 | 9,407 |
Cash paid for interest | 19,187 | 15,231 |
Cash received from interest | (1,630) | (323) |
Non-cash amounts obtained as a beneficial interest in exchange for transferring trade receivables in a securitization transaction | $ 46,882 | $ 48,685 |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 3 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies The accompanying condensed consolidated financial statements represent the consolidation of Pyxus International, Inc. (the "Company" or "Pyxus") and all companies that we directly or indirectly control, either through majority ownership or otherwise. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. All intercompany accounts and transactions have been eliminated. These condensed consolidated interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2019. The year-end condensed balance sheet data was derived from the audited financial statements, but does not include all the disclosures required by U.S. GAAP. Due to the seasonal nature of the Company’s business, the results of operations for any fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. Leases The Company measures right-of-use assets and related lease liabilities based on the present value of remaining lease payments, including in-substance fixed payments, the current payment amount when payments depend on an index or rate (e.g., inflation adjustments, market renewals), and the amount the Company believes is probable to be paid to the lessor under residual value guarantees, when applicable. Lease contracts may include fixed payments for non-lease components, such as maintenance, which are included in the measurement of lease liabilities for certain asset classes based on the Company’s election to combine lease and non-lease components. The Company does not recognize short-term leases, those lease contracts with durations of twelve months or less, on the consolidated balance sheet. As applicable borrowing rates are not typically implied within the lease arrangements, the Company discounts lease payments based on its estimated incremental borrowing rate at lease commencement, or modification, which is based on the Company’s estimated credit rating, the lease term at commencement and the contract currency of the lease arrangement. Segments During the three months ended December 31, 2018, the Company realigned its reportable segments to reflect changes to how the business is managed and results are reviewed by the Company's chief operating decision maker. In connection with the "One Tomorrow Transformation" initiative, the Company changed its organizational structure to support its diversified business lines. Prior to the realignment, the Company assessed financial information based on geographic regions. The Company's diversification efforts have resulted in management placing emphasis on data by business line in addition to the historical focus by geography. As a result of this realignment, the reportable segments now include Leaf - North America, Leaf - Other Regions, and Other Products and Services. Prior period segment financial information has been revised to conform to the current year presentation. Restricted Cash The following summarizes the restricted cash balance: June 30, 2019 June 30, 2018 March 31, 2019 Compensating balance for short-term borrowings $ 1,230 $ 1,047 $ 1,225 Capital investments — 850 — Escrow 1,397 — 2,894 Other 899 866 1,648 Total $ 3,526 $ 2,763 $ 5,767 As of June 30, 2019 and 2018, and March 31, 2019, the Company held $0, $2,638, and $1,082, respectively, in the Zimbabwe Real Time Gross Settlement (“RTGS”) system. RTGS is a local currency equivalent that as of June 30, 2019 was exchanged at a government specified rate of 6.6:1 with the U.S. Dollar ("USD"). Property, Plant, and Equipment The following summarizes purchases and sales of property, plant, and equipment included in accounts payable and notes receivable: June 30, 2019 June 30, 2018 March 31, 2019 Purchases of property, plant, and equipment included in accounts payable $ 6,545 $ 1,854 $ 7,095 Sales of property, plant, and equipment included in notes receivable 1,950 1,999 1,957 |
New Accounting Standards
New Accounting Standards | 3 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
New Accounting Standards | New Accounting Standards Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2016-02, Leases (Topic 842) . Under this guidance, a lessee recognizes assets and liabilities on its balance sheet for most leases, and retains a dual model approach for assessing lease classification and recognizing expense. This guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from leasing arrangements. The FASB subsequently issued updates to provide clarification on specific topics, including adoption guidance, practical expedients, and interim transition disclosure requirements. The Company adopted this guidance during the first quarter beginning April 1, 2019 under the modified retrospective approach, which does not require adjustments to comparative periods or require modified disclosures for those comparative periods. The guidance provides a number of optional practical expedients in transition. The Company elected the package of transition practical expedients. The Company implemented changes to the accounting policies, systems, and controls to align with the new guidance. There is a material impact on the consolidated balance sheet from applying this guidance, which resulted in the recognition of new right-of-use assets of $43,900 and lease liabilities of $42,064 as of April 1, 2019 associated with the Company’s operating leases. The impact on the results of operations, cash flows, and existing debt covenants is not material. The adoption of this guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from lease arrangements. See "Note 13. Leases" for more information. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . ASU 2017-04 simplifies the test for goodwill impairment as it eliminates step 2 of the goodwill impairment test by no longer requiring an entity to compare the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Upon adoption, goodwill impairment will be measured as the excess of the reporting unit's carrying value over fair value, limited to the amount of goodwill. The Company will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is needed. This guidance will be adopted on a prospective basis and is effective for the Company beginning on April 1, 2020. Early adoption is available and the Company is currently considering whether it will early adopt for its annual goodwill impairment testing. The Company does not expect the adoption of this new accounting standard to have a material impact on the Company's financial condition, results of operations or cash flows. In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans . ASU 2018-14 updates disclosure requirements for defined benefit plans. This guidance will be adopted using a retrospective approach and is effective for the Company on March 31, 2021. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to the Related Party Guidance for Variable Interest Entities. ASU 2018-17 changes how entities evaluate decision-making fees under the variable interest entity guidance. To determine whether decision-making fees represent a variable interest, an entity considers indirect interests held through related parties under common control on a proportional basis, rather than in their entirety. This guidance will be adopted using a retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company derives revenue from contracts with customers, primarily from the sale of processed tobacco and fees charged for processing and related services to the manufacturers of tobacco products. The following disaggregates sales and other operating revenues by major source: Three Months Ended June 30, 2019 2018 Leaf - North America: Product revenue $ 31,141 $ 46,452 Processing and other revenues 3,809 3,600 Total sales and other operating revenues 34,950 50,052 Leaf - Other Regions: Product revenue 225,147 223,896 Processing and other revenues 10,623 14,030 Total sales and other operating revenues 235,770 237,926 Other Products and Services: Total sales and other operating revenues (1) 5,950 3,011 Total sales and other operating revenues $ 276,670 $ 290,989 (1) Other products and services is primarily composed of revenue from the sale of legal cannabis in Canada and e-liquids product revenue. Product revenue is primarily processed tobacco sold to the customer. Processing and other revenues are mainly contracts to process green tobacco owned and provided by the customers. During processing, ownership remains with the customers and the Company is engaged to perform processing services. The following summarizes activity in the allowance for doubtful accounts: Three Months Ended June 30, 2019 2018 Balance, beginning of period $ (13,381) $ (7,055) Additions — (293) Write-offs 6,131 91 Balance, end of period (7,250) (7,257) Trade receivables 200,326 204,091 Trade receivables, net $ 193,076 $ 196,834 |
Income Taxes
Income Taxes | 3 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Accounting for Uncertainty in Income Taxes As of June 30, 2019, the Company’s unrecognized tax benefits totaled $9,854, of which $7,575 would impact the Company’s effective tax rate, if recognized. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. As of June 30, 2019, accrued interest and penalties totaled $1,158 and $688, respectively. The Company expects to continue accruing interest expense related to the unrecognized tax benefits described above. The Company may be subject to fluctuations in the unrecognized tax benefit due to currency exchange rate movements. During the three months ended June 30, 2019, the Company reached an income tax settlement with the Kenyan Revenue Authority for $1,558 for a previously recorded uncertain tax position. In addition, a previous accrual to settle asserted issues for years 2009 to 2016 in Zimbabwe of $964 was reduced by $818 to account for the exchange rate impact of the local currency equivalent. The U.S. federal net operating loss was reduced to reflect the impacts of certain tax accounting methods on Global Intangible Low-Taxed Income ("GILTI"). The Company does not expect additional changes in the amount of its unrecognized tax benefits in the next twelve months but acknowledges circumstances can change due to unexpected developments in the law. In certain jurisdictions, tax authorities have challenged positions taken by the Company that resulted in recognizing benefits that are material to its financial statements. The Company believes it is more likely than not that it will prevail in these situations and accordingly has not recorded liabilities for these positions. The Company expects the challenged positions to be settled at a time greater than twelve months from its balance sheet date. The Company and its subsidiaries file a U.S. federal consolidated income tax return as well as returns in several U.S. states and a number of foreign jurisdictions. As of June 30, 2019, the Company’s earliest open tax year for U.S. federal income tax purposes is its fiscal year ended March 31, 2016. The Company's tax attributes from prior periods remain subject to adjustment. Open tax years in state and foreign jurisdictions generally range from three to six years. Provision for the Three Months Ended June 30, 2019 The Company's quarterly provision for income taxes has been calculated using the annual effective tax rate method (“AETR method”), which applies an estimated annual effective tax rate to pre-tax income or loss. The effective tax rate used for the three months ended June 30, 2019 and 2018 was (59.2)% and 92.7%, respectively. The decrease in the effective tax rate was due to the impact of net foreign exchange effects, increases in non-deductible interest, as well as Subpart F income, and variation in expected jurisdictional mix of earnings. For the three months ended June 30, 2019, the Company recorded the net tax effects of certain discrete events, which resulted in an income tax benefit of $2,601. This discrete income tax benefit primarily related to the impact of changes in uncertain tax positions, an adjustment made to the deemed repatriation tax liability as a result of retroactive regulatory guidance issued during the quarter, and changes in foreign exchange impacts. For the three months ended June 30, 2018, the Company recorded the tax effects of a discrete event resulting in additional income tax expense of $3,906 |
Guarantees
Guarantees | 3 Months Ended |
Jun. 30, 2019 | |
Guarantees [Abstract] | |
Guarantees | Guarantees In certain markets, the Company guarantees bank loans to suppliers to finance their crops. Under longer-term arrangements, the Company may also guarantee financing on suppliers’ construction of curing barns or other tobacco production assets. Guaranteed loans are generally repaid concurrent with the delivery of tobacco to the Company. The Company is obligated to repay any guaranteed loan should the supplier default. If default occurs, the Company has recourse against its various suppliers and their production assets. The Company also guarantees bank loans of certain unconsolidated subsidiaries in Asia and South America. The following summarizes amounts guaranteed and the fair value of those guarantees: June 30, 2019 June 30, 2018 March 31, 2019 Amounts guaranteed (not to exceed) $ 127,738 $ 153,347 $ 143,298 Amounts outstanding under guarantee 90,535 84,116 103,846 Fair value of guarantees 3,136 3,544 3,714 Of the guarantees outstanding at June 30, 2019, most expire within one year. As of June 30, 2019 and 2018, and March 31, 2019, respectively, the Company had balances of $24,131, $18,652, and $18,659 due to local banks on behalf of suppliers included in accounts payable in the condensed consolidated balance sheets. |
Goodwill and Intangibles
Goodwill and Intangibles | 3 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Goodwill and Intangibles The following summarizes goodwill and other intangible assets: Three Months Ended June 30, 2019 Weighted Average Remaining Useful Life Beginning Gross Carrying Amount Additions Accumulated Amortization (1) Impact of Foreign Currency Translation Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 9.3 years $ 63,980 $ — $ (30,032) $ — $ 33,948 Production and supply contracts 2.7 years 14,893 — (10,892) — 4,001 Internally developed software 3.8 years 19,917 205 (18,531) — 1,591 Licenses (2) 17.9 years 32,284 68 (2,106) 570 30,816 Trade names 6.8 years 500 — (78) — 422 Intangibles not subject to amortization: Goodwill 34,336 — — 211 34,547 Total $ 165,910 $ 273 $ (61,639) $ 781 $ 105,325 (1) Amortization expense across intangible asset classes for the three months ended June 30, 2019 was $1,846. (2) Certain of the Company's license intangibles are subject to annual renewal. Twelve Months Ended March 31, 2019 Weighted Average Remaining Useful Life Beginning Gross Carrying Amount Additions (1) Accumulated Amortization (2) Impact of Foreign Currency Translation Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 9.6 years $ 58,530 $ 5,450 $ (29,027) $ — $ 34,953 Production and supply contracts 2.9 years 14,893 — (10,668) — 4,225 Internally developed software 3.8 years 18,812 1,105 (18,391) — 1,526 Licenses (3) 18.1 years 30,339 2,991 (1,644) (1,046) 30,640 Trade names 7.0 years — 500 (63) — 437 Intangibles not subject to amortization: Goodwill (4) 27,546 7,174 — (384) 34,336 Total $ 150,120 $ 17,220 $ (59,793) $ (1,430) $ 106,117 (1) Additions to goodwill, customer relationships, and trade names relate to the acquisition of Humble Juice. Additions to licenses relates to FIGR East, FIGR Norfolk, and Alliance One Specialty Products, LLC. (2) Amortization expense across intangible asset classes for the fiscal year ended March 31, 2019 was $7,943. (3) Certain of the Company's license intangibles are subject to annual renewal. (4) Goodwill activity relates to the Other Products and Services segment. The following summarizes the estimated future intangible asset amortization expense: For Fiscal Customer Production Internally Licenses Trade Names Total July 1, 2019 through March 31, 2020 $ 3,017 $ 1,992 $ 375 $ 1,342 $ 48 $ 6,774 2021 4,022 1,397 394 1,789 63 7,665 2022 4,022 612 322 1,787 63 6,806 2023 4,022 — 289 1,783 63 6,157 2024 4,022 — 170 1,783 63 6,038 Later 14,843 — 41 22,332 122 37,338 $ 33,948 $ 4,001 $ 1,591 $ 30,816 $ 422 $ 70,778 *Estimated amortization expense for the internally developed software is based on costs accumulated as of June 30, 2019. These estimates will change as new costs are incurred and until the software is placed into service in all locations. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Jun. 30, 2019 | |
Variable Interest Entities [Abstract] | |
Variable Interest Entities | Variable Interest Entities The Company holds variable interests in multiple entities that primarily procure or process inventory on behalf of the Company and other parties or are securitization entities. These variable interests relate to equity investments, advances, guarantees made by the Company, and securitized receivables. The Company is not the primary beneficiary of the majority of its variable interests in variable interest entities, as it does not have the power to direct the activities that most significantly impact the economic performance of the entities due to the entities’ management and board of directors structure. As a result, the majority of these variable interest entities are not consolidated. The Company holds a majority voting interest and is the primary beneficiary of its variable interest in Humble Juice Co., LLC ("Humble Juice"), a consolidated entity for which the related intercompany accounts and transactions have been eliminated. The following summarizes financial relationships with variable interest entities: June 30, 2019 June 30, 2018 March 31, 2019 Investment in variable interest entities $ 57,541 $ 63,021 $ 64,281 Advances to variable interest entities 14,500 9,937 3,273 Guaranteed amounts to variable interest entities (not to exceed) 63,584 71,919 67,027 The Company's investment in and advances to variable interest entities are classified as investments in unconsolidated affiliates and accounts receivable, related parties, respectively, in the consolidated balance sheets. The Company's maximum exposure to loss in these variable interest entities is represented by the investments, advances, guarantees, and the deferred purchase price on the sale of securitized receivables that is disclosed in "Note 18. Sale of Receivables" . |
Segment Information
Segment Information | 3 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company's operations are managed and reported in ten operating segments that are organized by product category and geographic area and aggregated into three reportable segments for financial reporting purposes: Leaf - North America, Leaf - Other Regions, and Other Products and Services. These segment groupings are consistent with information used by the chief operating decision maker to assess performance and allocate resources. The types of products and services from which each reportable segment derives its revenues are as follows: • Leaf - North America ships tobacco to manufacturers of cigarettes and other consumer tobacco products around the world. Leaf - North America is more highly concentrated on processing and other activities compared to the rest of the world. • Leaf - Other Regions ships tobacco to manufacturers of cigarettes and other consumer tobacco products around the world. Leaf - Other Regions sells a small amount of processed but un-threshed flue-cured and burley tobacco in loose-leaf and bundle form to certain customers. • Other Products and Services primarily consists of cannabis and e-liquid products. Cannabis was legalized for adult use in Canada on October 17, 2018. The cannabis products of certain of the Company's subsidiaries have been sold in the Canadian market, primarily to municipally-owned retailers. E-liquids products are sold to consumers via e-commerce platforms and other distribution channels, and retail stores. The following summarizes segment information: Three Months Ended June 30, 2019 2018 Sales and other operating revenues: Leaf - North America $ 34,950 $ 50,052 Leaf - Other Regions 235,770 237,926 Other Products and Services 5,950 3,011 Total sales and other operating revenues $ 276,670 $ 290,989 Operating income (loss): Leaf - North America $ 762 $ 1,293 Leaf - Other Regions 7,034 7,654 Other Products and Services (14,725) (4,256) Total operating (loss) income $ (6,929) $ 4,691 June 30, 2019 June 30, 2018 March 31, 2019 Segment assets: Leaf - North America $ 257,707 $ 300,307 $ 243,248 Leaf - Other Regions 1,540,147 1,735,490 1,488,226 Other Products and Services 167,721 93,569 127,801 Total assets $ 1,965,575 $ 2,129,366 $ 1,859,275 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The weighted average number of common shares outstanding is reported as the weighted average of the total shares of common stock outstanding, net of shares of common stock held by a wholly owned subsidiary. 785 shares of common stock were owned by the subsidiary as of June 30, 2019 and 2018. This subsidiary waives its right to receive dividends and does not have the right to vote. Certain potentially dilutive options were not included in the computation of earnings per diluted share because their exercise prices were greater than the average market price of the shares of common stock during the period and their effect would be antidilutive. These shares totaled 427 at a weighted average exercise price of $60.00 per share as of June 30, 2019 and 2018. Diluted net loss per share as of June 30, 2019 was the same as basic net loss per share as the effects of potentially dilutive items were antidilutive given the Company’s net loss. The following summarizes the computation of earnings per share: Three Months Ended June 30, (in thousands, except per share data) 2019 2018 Basic loss per share: Net loss attributable to Pyxus International, Inc. $ (61,797) $ (759) Shares: Weighted average number of shares outstanding 9,100 9,027 Basic loss per share $ (6.79) $ (0.08) Diluted loss per share: Net loss attributable to Pyxus International, Inc. $ (61,797) $ (759) Shares: Weighted average number of shares outstanding 9,100 9,027 Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price — * — * Adjusted weighted average number of shares outstanding 9,100 9,027 Diluted loss per share $ (6.79) $ (0.08) *All outstanding restricted shares, shares applicable to stock options, and restricted stock units are excluded because their inclusion would have an antidilutive effect on the loss per share. The dilutive shares would have been 62 and 65 at June 30, 2019 and 2018, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The following summarizes the Company's stock-based compensation expense related to awards granted under its various employee and non-employee stock incentive plans: Three Months Ended June 30, (in thousands) 2019 2018 Stock-based compensation expense $ 429 $ 295 Stock-based compensation expense payable in cash — — The following summarizes the Company's stock-based compensation awards: Three Months Ended June 30, (in thousands, except grant date fair value) 2019 2018 Restricted stock Number granted 13 7 Grant date fair value $ 15.20 $ 15.85 Restricted stock units Number granted 2 61 Grant date fair value $ 18.29 $ 16.00 Performance-based stock units Number granted — 30 Grant date fair value $ — $ 16.00 |
Contingencies and Other Informa
Contingencies and Other Information | 3 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and Other Information | Contingencies and Other Information Brazilian Tax Credits The government in the Brazilian State of Parana ("Parana") issued a tax assessment on October 26, 2007 with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. The assessment for intrastate trade tax credits taken is $3,437 and the total assessment including penalties and interest at June 30, 2019 is $12,041. On March 18, 2014, the government in Brazilian State of Santa Catarina also issued a tax assessment with respect to local intrastate trade tax credits that result primarily from tobacco transferred between states within Brazil. The assessment for intrastate trade tax credits taken is $2,973 and the total assessment including penalties and interest at June 30, 2019 is $7,862. The Company believes it has properly complied with Brazilian law and will contest any assessment through the judicial process. Should the Company lose in the judicial process, the loss of the intrastate trade tax credits would have a material impact on the financial statements of the Company. The Company also has local intrastate trade tax credits in the Brazil State of Rio Grande do Sul and the State of Santa Catarina. These jurisdictions permit the sale or transfer of excess credits to third parties, however approval must be obtained from the tax authorities. The Company has agreements with the state governments regarding the amounts and timing of credits that can be sold. The tax credits have a carrying value of $10,782. The intrastate trade tax credits are monitored for impairment in future periods based on market conditions and the Company’s ability to use or sell the tax credits. In 1969, the Brazilian government created a tax credit program that allowed companies to earn IPI tax credits (“IPI credits”) based on the value of their exports. The government began to phase out this program in 1979, which resulted in numerous lawsuits between taxpayers and the Brazilian government. The Company has a long legal history with respect to credits it earned while the IPI credit program was in effect. In 2001, the Company won a claim related to certain IPI credits it earned between 1983 and 1990. The Brazilian government appealed this decision and numerous rulings and appeals were rendered on behalf of both the government and the Company from 2001 through 2013. Because of this favorable ruling, the Company began to use these earned IPI credits to offset federal taxes in 2004 and 2005, until it received a Judicial Order to suspend the IPI offsetting in 2005. The value of the federal taxes offset in 2004 and 2005 was $24,142 and the Company established a reserve on these credits at the time of offsetting as they were not yet realizable due to the legal uncertainty that existed. Specifically, the Company extinguished other federal tax liabilities using IPI credits and recorded a liability in Pension, Postretirement and Other Long-Term Liabilities to reflect that the credits were not realizable at that time due to the prevalent legal uncertainty. On March 7, 2013, the Brazilian Supreme Court rendered a final decision in favor of the Company that recognized the validity of the IPI credits and secured the Company's right to benefit from the IPI credits earned from March 1983 to October 1990. This final decision expressly stated the Company has the right to the IPI credits. The Company estimates the total amount of the IPI credits to be approximately $94,316 at March 31, 2013. Since the March 2013 ruling definitively (without the government's ability to appeal) granted the Company the ownership of the IPI credits generated between 1983 and 1990, the Company believes the amount of IPI credits that were used to offset other federal taxes in 2004 and 2005 are realizable beyond a reasonable doubt. Accordingly, at March 31, 2013, the Company recorded the $24,142 IPI credits it realized in the Statements of Consolidated Operations in Other Income. No further benefit has been recognized pending the outcome of the judicial procedure to ascertain the final amount as those amounts have not yet been realized. Other Matters On June 7, 2019, the Company and certain of its officers were named as defendants in a complaint filed in the United States District Court for the Eastern District of North Carolina. The complaint was brought on behalf of a putative class of investors who purchased the Company's common stock between June 7, 2018 and November 8, 2018. The complaint alleges that the defendants violated federal securities laws provisions with respect to fraud and material representations, which purported misconduct was revealed by the Company's November 8, 2018 announcement that sales and other operating revenues for the quarter ended September 30, 2018 had decreased approximately 12% over the prior year quarter and the announcement on November 9, 2018 by the Securities and Exchange Commission that the Company had settled charges that it had materially misstated its financial statements from 2011 through the second quarter of 2015 due to improper and insufficient accounting, processes and control activities, deferred crop costs and revenue transactions in Africa. The complaint alleges that members of the purported class were harmed by the decline in the trading price of the Company's common stock on the dates of these announcements. The complaint seeks damages in an unspecified amount. The Company does not believe the claims have merit, and intends to vigorously defend against the claims made in the complaint. In addition to the above-mentioned matters, certain of the Company’s subsidiaries are involved in other litigation or legal matters incidental to their business activities, including tax matters. While the outcome of these matters cannot be predicted with certainty, the Company is vigorously defending them and does not currently expect that any of them will have a material adverse effect on its business or financial position. However, should one or more of these matters be resolved in a manner adverse to its current expectation, the effect on the Company’s results of operations for a particular fiscal reporting period could be material. Asset Retirement Obligations In accordance with generally accepted accounting principles, the Company records all known asset retirement obligations (“ARO”) for which the liability can be reasonably estimated. Currently, it has identified an ARO associated with one of its facilities that requires it to restore the land to its initial condition upon vacating the facility. The Company has not recognized a liability under generally accepted accounting principles for this ARO because the fair value of restoring the land at this site |
Debt Arrangements
Debt Arrangements | 3 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt Arrangements | Debt Arrangements ABL Facility The ABL credit agreement restricts the Company from paying any dividends during the term of this facility subject to the satisfaction of specified financial ratios. In addition, the indentures governing the Company's outstanding 8.5% senior secured first lien notes due 2021 and its outstanding 9.875% senior secured second lien notes due 2021 contain similar restrictions and also prohibit the payment of dividends and other distributions if the Company fails to satisfy a ratio of consolidated EBITDA to fixed charges of at least 2.0 to 1.0. As of June 30, 2019, the Company did not satisfy this fixed charge coverage ratio. The Company may not satisfy this ratio from time to time and failure to meet this fixed charge coverage ratio does not constitute an event of default. |
Leases
Leases | 3 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company has operating leases for land, buildings, automobiles, and other equipment that expire at various dates through 2040. Leases for real estate generally have initial terms ranging from 2 to 15 years, excluding renewal options. Leases for equipment typically have initial terms ranging from 2 to 5 years excluding renewal options. Most leases have fixed rentals, with many of the real estate leases requiring additional payments for real estate taxes. These lease terms may include optional renewals, terminations or purchases, which are considered in the Company’s assessments when such options are reasonably certain to be exercised. The following summarizes weighted-average information associated with the measurement of remaining operating lease as of June 30, 2019: Weighted-average remaining lease term 5.3 years Weighted-average discount rate 9.5% The following summarizes lease costs for operating leases for the three months ended June 30, 2019: Operating lease costs $ 4,188 Variable and short-term lease costs 1,468 Total lease costs $ 5,656 The following summarizes supplemental cash flow information related to cash paid for amounts included in the measurement of lease liabilities three months ended June 30, 2019: Operating cash flows impact - operating leases $ 4,140 Right-of-use assets obtained in exchange for new operating leases $ 1,578 The following reconciles maturities of operating lease liabilities to the lease liabilities reflected in the condensed consolidated balance sheet as of June 30, 2019: 2020 (excluding the three months ended June 30, 2019) $ 11,672 2021 14,328 2022 10,462 2023 6,117 2024 4,982 Thereafter 11,772 Total future minimum lease payments 59,333 Less: amounts related to imputed interest 15,182 Present value of future minimum lease payments 44,151 Less: operating lease liabilities, current 15,275 Operating lease liabilities, non-current $ 28,876 The Company continuously monitors and may negotiate contract amendments that include extensions or modifications to existing leases. The following presents the future minimum rental commitments under noncancelable operating leases as of March 31, 2019: 2020 (excluding the three months ended June 30, 2019) $ 15,651 2021 10,554 2022 8,483 2023 6,735 2024 5,356 Thereafter 7,324 Total $ 54,103 |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Jun. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial InstrumentsThe Company uses forward or option currency contracts to protect against volatility associated with certain non-U.S. dollar denominated forecasted transactions. These contracts are for green tobacco purchases, processing costs, and selling, general and administrative costs. As of June 30, 2019 and 2018, accumulated other comprehensive loss includes $2,245 and $1,496, net of tax of $98 and $398, for unrealized losses related to designated cash flow hedges, respectively. The Company recorded losses of $651 and $0 in its cost of goods and services sold for the three months ended June 30, 2019 and 2018, respectively. The Company recorded a current derivative asset of $3 and $6 as of June 30, 2019 and 2018, respectively, included on the condensed consolidated balance sheets. The USD notional amount of derivatives contracts outstanding as of June 30, 2019 was $32,574. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 3 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits The following summarizes the components of net periodic benefit cost: Pension Benefits Three Months Ended June 30, 2019 2018 Operating expenses: Service cost $ 117 $ 120 Interest expense: Interest expense 1,029 1,155 Expected return on plan assets (1,121) (1,286) Amortization of prior service cost 10 11 Actuarial loss 456 422 Net periodic pension cost $ 491 $ 422 Other Postretirement Benefits Three Months Ended June 30, 2019 2018 Operating expenses: Service cost $ 2 $ 4 Interest expense: Interest expense 82 83 Amortization of prior service cost (177) (177) Actuarial loss 109 109 Net periodic pension cost $ 16 $ 19 |
Inventories
Inventories | 3 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: June 30, 2019 June 30, 2018 March 31, 2019 Processed tobacco $ 554,165 $ 563,539 $ 455,303 Unprocessed tobacco 238,653 330,227 186,108 Other 24,845 23,162 26,760 Total $ 817,663 $ 916,928 $ 668,171 |
Other Comprehensive Loss
Other Comprehensive Loss | 3 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Other Comprehensive Loss | Other Comprehensive Loss The movements in accumulated other comprehensive loss and the related tax effects that are due to current period activity and reclassifications to the condensed consolidated statements of operations as shown on the condensed consolidated statements of comprehensive loss. The following summarizes pension and other postretirement benefits and derivatives that were reclassified from accumulated other comprehensive loss to interest expense and cost of goods and services sold within the condensed consolidated statement of operations: Three Months Ended June 30, Affected Line Item in the Condensed 2019 2018 Consolidated Statements of Operations Pension and other postretirement benefits*: Actuarial loss $ 560 $ 533 Amortization of prior service cost (165) (167) Amounts reclassified from accumulated other comprehensive loss to net income, gross 395 366 Tax effects of amounts reclassified from (84) — Amounts reclassified from accumulated other comprehensive loss to net income, net $ 311 $ 366 Interest expense Three Months Ended June 30, Affected Line Item in the Condensed 2019 2018 Consolidated Statements of Operations Derivatives: Losses reclassified to cost of goods sold $ 651 $ — Amounts reclassified from accumulated other comprehensive loss to net income, gross $ 651 $ — Tax effects of amounts reclassified from (137) — Amounts reclassified from accumulated other comprehensive loss to net income, net $ 514 $ — Cost of goods and services sold *Amounts are included in net periodic benefit costs for pension and other postretirement benefits. See "Note 15. Pension and Other Postretirement Benefits" for more information. |
Sale of Receivables
Sale of Receivables | 3 Months Ended |
Jun. 30, 2019 | |
Transfers and Servicing [Abstract] | |
Sale of Receivables | Sale of Receivables The Company sells trade receivables to unaffiliated financial institutions under two accounts receivable securitization facilities. Under the first facility, the Company continuously sells a designated pool of trade receivables to a special purpose entity, which sells 100% of the receivables to an unaffiliated financial institution. During the three months ended June 30, 2018, the investment limit of this program was decreased from $155,000 trade receivables to $125,000 trade receivables. Under the second facility, the Company offers receivables for sale to an unaffiliated financial institution, which are then subject to acceptance by the unaffiliated financial institution. As of June 30, 2019, the investment limit under the second facility was $125,000 trade receivables. The Company is the servicer of both facilities and may receive funds that are due to the unaffiliated financial institutions, which are net settled on the next settlement date. As a result of the net settlement, trade and other receivables, net in the condensed consolidated balance sheets has been reduced by $6,348, $8,559, and $5,208 as of June 30, 2019 and 2018, and March 31, 2019, respectively. The following summarizes the accounts receivable securitization information: June 30, March 31, 2019 2018 2019 Receivables outstanding in facility $ 78,258 $ 79,179 $ 210,672 Beneficial interest 14,648 17,736 40,332 Servicing liability — 8 90 Cash proceeds for the three months ended: Cash purchase price $ 103,517 $ 101,080 $ 672,333 Deferred purchase price 72,266 76,240 242,966 Service fees 137 180 576 Total $ 175,920 $ 177,500 $ 915,875 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following summarizes the items measured at fair value on a recurring basis: June 30, 2019 June 30, 2018 March 31, 2019 Total Assets / Total Assets / Total Assets / Liabilities Liabilities Liabilities Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Assets Derivative financial instruments $ 3 $ — $ 3 $ 6 $ — $ 6 $ 186 $ — $ 186 Securitized beneficial interests — 14,648 14,648 — 17,736 17,736 — 40,332 40,332 Total assets $ 3 $ 14,648 $ 14,651 $ 6 $ 17,736 $ 17,742 $ 186 $ 40,332 $ 40,518 Liabilities Long-term debt $ 814,766 $ 623 $ 815,389 $ 863,620 $ 711 $ 864,331 $ 830,082 $ 703 $ 830,785 Guarantees — 3,136 3,136 — 3,544 3,544 — 3,714 3,714 Total liabilities $ 814,766 $ 3,759 $ 818,525 $ 863,620 $ 4,255 $ 867,875 $ 830,082 $ 4,417 $ 834,499 Level 2 measurements • Debt: The fair value of debt is based on the market price for similar financial instruments or model-derived valuations whose inputs are observable. The primary inputs to the valuation include market expectations, the Company's credit risk, and the contractual terms of the debt instrument. • Derivatives: The fair value of derivatives is based on the discounted cash flow analysis of the expected future cash flows. The primary inputs to the valuation include forward yield curves, implied volatilities, LIBOR rates, and credit valuation adjustments. Level 3 measurements • Guarantees: The fair value of guarantees is based on the discounted cash flow analysis of the expected future cash flows or historical loss rates. The primary inputs to the discounted cash flow analysis include a market interest rate of 15.0% and the Company’s historical loss rates of 2.4% to 10.0% as of June 30, 2019. The historical loss rate was weighted by the principal balance of the loans. • Securitized beneficial interests: The fair value of securitized beneficial interests is based on the present value of future expected cash flows. The primary inputs to this valuation include payment speeds of 84 days and a discount rate of 4.9% as of June 30, 2019. The discount rate was weighted by the outstanding interest. Payment speed was weighted by the average days outstanding. The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis: Three Months Ended June 30, 2019 Three Months Ended June 30, 2018 Securitized Beneficial Interests Guarantees Securitized Beneficial Interests Guarantees Beginning balance $ 40,332 $ 3,714 $ 48,715 $ 5,864 Issuances of sales of receivables/guarantees 46,882 293 48,685 244 Settlements (71,623) (879) (79,551) (2,701) (Losses) gains recognized in earnings (943) 8 (113) 137 Ending balance $ 14,648 $ 3,136 $ 17,736 $ 3,544 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The following summarizes sales and purchases with related parties: Three Months Ended June 30, 2019 2018 Sales $ 7,504 $ 6,890 Purchases 21,355 26,267 |
Investee Companies
Investee Companies | 3 Months Ended |
Jun. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investee Companies | Investee Companies The following summarizes the Company's equity method investments as of June 30, 2019: Investee Name Location Primary Purpose The Company's Ownership Percentage Basis Difference Adams International Ltd. Thailand purchase and process tobacco 49 % — Alliance One Industries India Private Ltd. India purchase and process tobacco 49 % — China Brasil Tobacos Exportadora SA Brazil purchase and process tobacco 49 % 6,707 Criticality LLC U.S. extraction of cannabidiol from industrial hemp 40 % 913 Nicotine River, LLC U.S. produce consumable e-liquids 40 % 2,026 Oryantal Tutun Paketleme Turkey process tobacco 50 % — Purilum, LLC U.S. produce flavor formulations and consumable e-liquids 50 % — Siam Tobacco Export Company Thailand purchase and process tobacco 49 % — The following summarizes financial information for these investees for the three months ended June 30, 2019 and 2018: Three Months Ended June 30, Operations Statement Information 2019 2018 Sales $ 46,233 $ 47,226 Gross profit 9,507 7,767 Net income 3,100 2,044 Company's dividends received 6,094 — June 30, Balance Sheet Information 2019 2018 March 31, 2019 Current assets $ 236,389 $ 235,004 $ 152,661 Property, plant, and equipment and other assets 55,023 50,618 53,103 Current liabilities 184,526 172,263 89,791 Long-term obligations and other liabilities 3,354 4,622 3,222 Of the amounts presented above, the following summarizes financial information for China Brasil Tobacos Exportadora SA for the three months ended June 30, 2019 and 2018: Three Months Ended June 30, Operations Statement Information 2019 2018 Sales $ 18,391 $ 23,235 Gross profit 2,212 3,605 Net (loss) income (35) 780 Net (loss) income attributable to the investee (17) 382 |
Acquisition of Humble Juice Co.
Acquisition of Humble Juice Co., LLC | 3 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition of Humble Juice Co., LLC | Acquisition of Humble Juice Co., LLC On April 2, 2018, the Company acquired 51% of the equity in Humble Juice. Humble Juice sells e-liquid products and related merchandise. The Company acquired its interest in Humble Juice in exchange for consideration consisting of approximately $9,000 cash and $446 contingent consideration, subject to certain post-closing adjustments. The consolidation of Humble Juice has been treated as a business combination. The assets and liabilities were recorded at their fair value. The fair value of the non-controlling interest was $5,086. The Company incurred $12 of acquisition-related expenses, primarily consisting of consulting fees, which were accounted for separately from the business combination and expensed as incurred within selling, general, and administrative expenses in the condensed consolidated statements of operations. Following the acquisition, the Company recorded certain post-closing purchase price adjustments. The acquisition allowed the Company to expand its e-liquid product portfolio. The following summarizes the fair values of the assets acquired and liabilities assumed as of April 2, 2018: Cash and cash equivalents $ 308 Other receivables 56 Inventories 1,048 Other current assets 6 Property, plant, and equipment 8 Goodwill 7,174 Other intangible assets 5,950 Total assets acquired 14,550 Accounts payable 18 Total liabilities 18 Fair value of equity interest $ 14,532 |
Restructuring and Asset Impairm
Restructuring and Asset Impairment Charges | 3 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Asset Impairment Charges | Restructuring and Asset Impairment Charges During the fiscal year ended March 31, 2019, the Company incurred costs associated with the closure of a processing facility in the Leaf - Other Regions segment in order to process tobacco in the affected area under a third-party processing arrangement going forward, the consolidation of the Company's U.S. green tobacco processing operations into its Wilson, North Carolina facility, and the re-purposing of its Farmville, North Carolina facility for storage and special projects. The following summarizes the restructuring actions: Three Months Ended June 30, 2019 2018 Employee separation charges $ 93 $ 1,198 Asset impairment and other non-cash charges 119 343 Restructuring and asset impairment charges $ 212 $ 1,541 The following summarizes the employee separation and other cash charges recorded in the Company's Leaf - North America and Leaf - Other Regions segments: Three Months Ended June 30, 2019 2018 Leaf - North America Leaf - Other Regions Leaf - North America Leaf - Other Regions Beginning balance $ 1,621 $ 222 $ — $ 107 Period charges 7 86 247 951 Payments (811) (94) — — Ending balance $ 817 $ 214 $ 247 $ 1,058 The following summarizes the asset impairment and other non-cash charges for the Company's Leaf - North America and Leaf - Other Regions segments: Three Months Ended June 30, 2019 2018 Leaf - North America $ — $ — Leaf - Other Regions 119 343 Total $ 119 $ 343 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On February xx , 2019, a Canadian subsidiary of the Company acquired an additional 20% equity position in Canada’s Island Garden Inc. for C$20,000.0 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 3 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying condensed consolidated financial statements represent the consolidation of Pyxus International, Inc. (the "Company" or "Pyxus") and all companies that we directly or indirectly control, either through majority ownership or otherwise. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of management, all normal and recurring adjustments necessary for fair statement of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. All intercompany accounts and transactions have been eliminated. These condensed consolidated interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2019. The year-end condensed balance sheet data was derived from the audited financial statements, but does not include all the disclosures required by U.S. GAAP. Due to the seasonal nature of the Company’s business, the results of operations for any fiscal quarter are not necessarily indicative of the operating results that may be attained for other quarters or a full fiscal year. |
Leases | Leases The Company measures right-of-use assets and related lease liabilities based on the present value of remaining lease payments, including in-substance fixed payments, the current payment amount when payments depend on an index or rate (e.g., inflation adjustments, market renewals), and the amount the Company believes is probable to be paid to the lessor under residual value guarantees, when applicable. Lease contracts may include fixed payments for non-lease components, such as maintenance, which are included in the measurement of lease liabilities for certain asset classes based on the Company’s election to combine lease and non-lease components. The Company does not recognize short-term leases, those lease contracts with durations of twelve months or less, on the consolidated balance sheet. As applicable borrowing rates are not typically implied within the lease arrangements, the Company discounts lease payments based on its estimated incremental borrowing rate at lease commencement, or modification, which is based on the Company’s estimated credit rating, the lease term at commencement and the contract currency of the lease arrangement. |
Segments | Segments During the three months ended December 31, 2018, the Company realigned its reportable segments to reflect changes to how the business is managed and results are reviewed by the Company's chief operating decision maker. In connection with the "One Tomorrow Transformation" initiative, the Company changed its organizational structure to support its diversified business lines. Prior to the realignment, the Company assessed financial information based on geographic regions. The Company's diversification efforts have resulted in management placing emphasis on data by business line in addition to the historical focus by geography. As a result of this realignment, the reportable segments now include Leaf - North America, Leaf - Other Regions, and Other Products and Services. Prior period segment financial information has been revised to conform to the current year presentation. |
New Accounting Standards | Recently Adopted Accounting Pronouncements In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") No. 2016-02, Leases (Topic 842) . Under this guidance, a lessee recognizes assets and liabilities on its balance sheet for most leases, and retains a dual model approach for assessing lease classification and recognizing expense. This guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from leasing arrangements. The FASB subsequently issued updates to provide clarification on specific topics, including adoption guidance, practical expedients, and interim transition disclosure requirements. The Company adopted this guidance during the first quarter beginning April 1, 2019 under the modified retrospective approach, which does not require adjustments to comparative periods or require modified disclosures for those comparative periods. The guidance provides a number of optional practical expedients in transition. The Company elected the package of transition practical expedients. The Company implemented changes to the accounting policies, systems, and controls to align with the new guidance. There is a material impact on the consolidated balance sheet from applying this guidance, which resulted in the recognition of new right-of-use assets of $43,900 and lease liabilities of $42,064 as of April 1, 2019 associated with the Company’s operating leases. The impact on the results of operations, cash flows, and existing debt covenants is not material. The adoption of this guidance requires enhanced disclosures regarding the amount, timing, and uncertainty of cash flows arising from lease arrangements. See "Note 13. Leases" for more information. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. This guidance will be adopted using a modified retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . ASU 2017-04 simplifies the test for goodwill impairment as it eliminates step 2 of the goodwill impairment test by no longer requiring an entity to compare the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Upon adoption, goodwill impairment will be measured as the excess of the reporting unit's carrying value over fair value, limited to the amount of goodwill. The Company will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is needed. This guidance will be adopted on a prospective basis and is effective for the Company beginning on April 1, 2020. Early adoption is available and the Company is currently considering whether it will early adopt for its annual goodwill impairment testing. The Company does not expect the adoption of this new accounting standard to have a material impact on the Company's financial condition, results of operations or cash flows. In August 2018, the FASB issued ASU No. 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans . ASU 2018-14 updates disclosure requirements for defined benefit plans. This guidance will be adopted using a retrospective approach and is effective for the Company on March 31, 2021. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. In October 2018, the FASB issued ASU No. 2018-17, Consolidation (Topic 810): Targeted Improvements to the Related Party Guidance for Variable Interest Entities. ASU 2018-17 changes how entities evaluate decision-making fees under the variable interest entity guidance. To determine whether decision-making fees represent a variable interest, an entity considers indirect interests held through related parties under common control on a proportional basis, rather than in their entirety. This guidance will be adopted using a retrospective approach and is effective for the Company on April 1, 2020. The Company is evaluating the effect that adoption of this guidance will have on its consolidated financial statements and related disclosures. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Restricted Cash Balance | The following summarizes the restricted cash balance: June 30, 2019 June 30, 2018 March 31, 2019 Compensating balance for short-term borrowings $ 1,230 $ 1,047 $ 1,225 Capital investments — 850 — Escrow 1,397 — 2,894 Other 899 866 1,648 Total $ 3,526 $ 2,763 $ 5,767 |
Schedule of Property, Plant and Equipment | The following summarizes purchases and sales of property, plant, and equipment included in accounts payable and notes receivable: June 30, 2019 June 30, 2018 March 31, 2019 Purchases of property, plant, and equipment included in accounts payable $ 6,545 $ 1,854 $ 7,095 Sales of property, plant, and equipment included in notes receivable 1,950 1,999 1,957 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue Disaggregated by Major Source | The following disaggregates sales and other operating revenues by major source: Three Months Ended June 30, 2019 2018 Leaf - North America: Product revenue $ 31,141 $ 46,452 Processing and other revenues 3,809 3,600 Total sales and other operating revenues 34,950 50,052 Leaf - Other Regions: Product revenue 225,147 223,896 Processing and other revenues 10,623 14,030 Total sales and other operating revenues 235,770 237,926 Other Products and Services: Total sales and other operating revenues (1) 5,950 3,011 Total sales and other operating revenues $ 276,670 $ 290,989 (1) Other products and services is primarily composed of revenue from the sale of legal cannabis in Canada and e-liquids product revenue. |
Schedule of Allowance for Doubtful Accounts and Activity of Claims Allowances | The following summarizes activity in the allowance for doubtful accounts: Three Months Ended June 30, 2019 2018 Balance, beginning of period $ (13,381) $ (7,055) Additions — (293) Write-offs 6,131 91 Balance, end of period (7,250) (7,257) Trade receivables 200,326 204,091 Trade receivables, net $ 193,076 $ 196,834 |
Guarantees (Tables)
Guarantees (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Guarantees [Abstract] | |
Schedule of Guarantees and Associated Fair Values | The following summarizes amounts guaranteed and the fair value of those guarantees: June 30, 2019 June 30, 2018 March 31, 2019 Amounts guaranteed (not to exceed) $ 127,738 $ 153,347 $ 143,298 Amounts outstanding under guarantee 90,535 84,116 103,846 Fair value of guarantees 3,136 3,544 3,714 |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Intangible Asset Rollforward | The following summarizes goodwill and other intangible assets: Three Months Ended June 30, 2019 Weighted Average Remaining Useful Life Beginning Gross Carrying Amount Additions Accumulated Amortization (1) Impact of Foreign Currency Translation Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 9.3 years $ 63,980 $ — $ (30,032) $ — $ 33,948 Production and supply contracts 2.7 years 14,893 — (10,892) — 4,001 Internally developed software 3.8 years 19,917 205 (18,531) — 1,591 Licenses (2) 17.9 years 32,284 68 (2,106) 570 30,816 Trade names 6.8 years 500 — (78) — 422 Intangibles not subject to amortization: Goodwill 34,336 — — 211 34,547 Total $ 165,910 $ 273 $ (61,639) $ 781 $ 105,325 (1) Amortization expense across intangible asset classes for the three months ended June 30, 2019 was $1,846. (2) Certain of the Company's license intangibles are subject to annual renewal. Twelve Months Ended March 31, 2019 Weighted Average Remaining Useful Life Beginning Gross Carrying Amount Additions (1) Accumulated Amortization (2) Impact of Foreign Currency Translation Ending Intangible Assets, Net Intangibles subject to amortization: Customer relationships 9.6 years $ 58,530 $ 5,450 $ (29,027) $ — $ 34,953 Production and supply contracts 2.9 years 14,893 — (10,668) — 4,225 Internally developed software 3.8 years 18,812 1,105 (18,391) — 1,526 Licenses (3) 18.1 years 30,339 2,991 (1,644) (1,046) 30,640 Trade names 7.0 years — 500 (63) — 437 Intangibles not subject to amortization: Goodwill (4) 27,546 7,174 — (384) 34,336 Total $ 150,120 $ 17,220 $ (59,793) $ (1,430) $ 106,117 (1) Additions to goodwill, customer relationships, and trade names relate to the acquisition of Humble Juice. Additions to licenses relates to FIGR East, FIGR Norfolk, and Alliance One Specialty Products, LLC. (2) Amortization expense across intangible asset classes for the fiscal year ended March 31, 2019 was $7,943. (3) Certain of the Company's license intangibles are subject to annual renewal. (4) Goodwill activity relates to the Other Products and Services segment. |
Schedule of Estimated Intangible Asset Amortization Expense | The following summarizes the estimated future intangible asset amortization expense: For Fiscal Customer Production Internally Licenses Trade Names Total July 1, 2019 through March 31, 2020 $ 3,017 $ 1,992 $ 375 $ 1,342 $ 48 $ 6,774 2021 4,022 1,397 394 1,789 63 7,665 2022 4,022 612 322 1,787 63 6,806 2023 4,022 — 289 1,783 63 6,157 2024 4,022 — 170 1,783 63 6,038 Later 14,843 — 41 22,332 122 37,338 $ 33,948 $ 4,001 $ 1,591 $ 30,816 $ 422 $ 70,778 *Estimated amortization expense for the internally developed software is based on costs accumulated as of June 30, 2019. These estimates will change as new costs are incurred and until the software is placed into service in all locations. |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Variable Interest Entities [Abstract] | |
Schedule of Variable Interest Entities | The following summarizes financial relationships with variable interest entities: June 30, 2019 June 30, 2018 March 31, 2019 Investment in variable interest entities $ 57,541 $ 63,021 $ 64,281 Advances to variable interest entities 14,500 9,937 3,273 Guaranteed amounts to variable interest entities (not to exceed) 63,584 71,919 67,027 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | The following summarizes segment information: Three Months Ended June 30, 2019 2018 Sales and other operating revenues: Leaf - North America $ 34,950 $ 50,052 Leaf - Other Regions 235,770 237,926 Other Products and Services 5,950 3,011 Total sales and other operating revenues $ 276,670 $ 290,989 Operating income (loss): Leaf - North America $ 762 $ 1,293 Leaf - Other Regions 7,034 7,654 Other Products and Services (14,725) (4,256) Total operating (loss) income $ (6,929) $ 4,691 June 30, 2019 June 30, 2018 March 31, 2019 Segment assets: Leaf - North America $ 257,707 $ 300,307 $ 243,248 Leaf - Other Regions 1,540,147 1,735,490 1,488,226 Other Products and Services 167,721 93,569 127,801 Total assets $ 1,965,575 $ 2,129,366 $ 1,859,275 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | The following summarizes the computation of earnings per share: Three Months Ended June 30, (in thousands, except per share data) 2019 2018 Basic loss per share: Net loss attributable to Pyxus International, Inc. $ (61,797) $ (759) Shares: Weighted average number of shares outstanding 9,100 9,027 Basic loss per share $ (6.79) $ (0.08) Diluted loss per share: Net loss attributable to Pyxus International, Inc. $ (61,797) $ (759) Shares: Weighted average number of shares outstanding 9,100 9,027 Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price — * — * Adjusted weighted average number of shares outstanding 9,100 9,027 Diluted loss per share $ (6.79) $ (0.08) *All outstanding restricted shares, shares applicable to stock options, and restricted stock units are excluded because their inclusion would have an antidilutive effect on the loss per share. The dilutive shares would have been 62 and 65 at June 30, 2019 and 2018, respectively. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation Expense | The following summarizes the Company's stock-based compensation expense related to awards granted under its various employee and non-employee stock incentive plans: Three Months Ended June 30, (in thousands) 2019 2018 Stock-based compensation expense $ 429 $ 295 Stock-based compensation expense payable in cash — — |
Schedule of Share-based Compensation Awards | The following summarizes the Company's stock-based compensation awards: Three Months Ended June 30, (in thousands, except grant date fair value) 2019 2018 Restricted stock Number granted 13 7 Grant date fair value $ 15.20 $ 15.85 Restricted stock units Number granted 2 61 Grant date fair value $ 18.29 $ 16.00 Performance-based stock units Number granted — 30 Grant date fair value $ — $ 16.00 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Schedule of Weighted-Average Remaining Lease Term and Discount Rates of Leases | The following summarizes weighted-average information associated with the measurement of remaining operating lease as of June 30, 2019: Weighted-average remaining lease term 5.3 years Weighted-average discount rate 9.5% |
Schedule of Lease Costs and Other Information | The following summarizes lease costs for operating leases for the three months ended June 30, 2019: Operating lease costs $ 4,188 Variable and short-term lease costs 1,468 Total lease costs $ 5,656 The following summarizes supplemental cash flow information related to cash paid for amounts included in the measurement of lease liabilities three months ended June 30, 2019: Operating cash flows impact - operating leases $ 4,140 Right-of-use assets obtained in exchange for new operating leases $ 1,578 |
Schedule of Maturities of Operating Lease Liabilities | The following reconciles maturities of operating lease liabilities to the lease liabilities reflected in the condensed consolidated balance sheet as of June 30, 2019: 2020 (excluding the three months ended June 30, 2019) $ 11,672 2021 14,328 2022 10,462 2023 6,117 2024 4,982 Thereafter 11,772 Total future minimum lease payments 59,333 Less: amounts related to imputed interest 15,182 Present value of future minimum lease payments 44,151 Less: operating lease liabilities, current 15,275 Operating lease liabilities, non-current $ 28,876 |
Schedule of Future Minimum Rental Commitments under Noncancelable Operating Leases | The following presents the future minimum rental commitments under noncancelable operating leases as of March 31, 2019: 2020 (excluding the three months ended June 30, 2019) $ 15,651 2021 10,554 2022 8,483 2023 6,735 2024 5,356 Thereafter 7,324 Total $ 54,103 |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Benefit Cost | The following summarizes the components of net periodic benefit cost: Pension Benefits Three Months Ended June 30, 2019 2018 Operating expenses: Service cost $ 117 $ 120 Interest expense: Interest expense 1,029 1,155 Expected return on plan assets (1,121) (1,286) Amortization of prior service cost 10 11 Actuarial loss 456 422 Net periodic pension cost $ 491 $ 422 Other Postretirement Benefits Three Months Ended June 30, 2019 2018 Operating expenses: Service cost $ 2 $ 4 Interest expense: Interest expense 82 83 Amortization of prior service cost (177) (177) Actuarial loss 109 109 Net periodic pension cost $ 16 $ 19 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following: June 30, 2019 June 30, 2018 March 31, 2019 Processed tobacco $ 554,165 $ 563,539 $ 455,303 Unprocessed tobacco 238,653 330,227 186,108 Other 24,845 23,162 26,760 Total $ 817,663 $ 916,928 $ 668,171 |
Other Comprehensive Loss (Table
Other Comprehensive Loss (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Schedule of Components Reclassified from Accumulated Other Comprehensive Loss to Earnings | The following summarizes pension and other postretirement benefits and derivatives that were reclassified from accumulated other comprehensive loss to interest expense and cost of goods and services sold within the condensed consolidated statement of operations: Three Months Ended June 30, Affected Line Item in the Condensed 2019 2018 Consolidated Statements of Operations Pension and other postretirement benefits*: Actuarial loss $ 560 $ 533 Amortization of prior service cost (165) (167) Amounts reclassified from accumulated other comprehensive loss to net income, gross 395 366 Tax effects of amounts reclassified from (84) — Amounts reclassified from accumulated other comprehensive loss to net income, net $ 311 $ 366 Interest expense Three Months Ended June 30, Affected Line Item in the Condensed 2019 2018 Consolidated Statements of Operations Derivatives: Losses reclassified to cost of goods sold $ 651 $ — Amounts reclassified from accumulated other comprehensive loss to net income, gross $ 651 $ — Tax effects of amounts reclassified from (137) — Amounts reclassified from accumulated other comprehensive loss to net income, net $ 514 $ — Cost of goods and services sold *Amounts are included in net periodic benefit costs for pension and other postretirement benefits. See "Note 15. Pension and Other Postretirement Benefits" for more information. |
Sale of Receivables (Tables)
Sale of Receivables (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Transfers and Servicing [Abstract] | |
Schedule of Accounts Receivable Securitization Information | The following summarizes the accounts receivable securitization information: June 30, March 31, 2019 2018 2019 Receivables outstanding in facility $ 78,258 $ 79,179 $ 210,672 Beneficial interest 14,648 17,736 40,332 Servicing liability — 8 90 Cash proceeds for the three months ended: Cash purchase price $ 103,517 $ 101,080 $ 672,333 Deferred purchase price 72,266 76,240 242,966 Service fees 137 180 576 Total $ 175,920 $ 177,500 $ 915,875 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Recurring Fair Value Measurements | The following summarizes the items measured at fair value on a recurring basis: June 30, 2019 June 30, 2018 March 31, 2019 Total Assets / Total Assets / Total Assets / Liabilities Liabilities Liabilities Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Level 2 Level 3 at Fair Value Assets Derivative financial instruments $ 3 $ — $ 3 $ 6 $ — $ 6 $ 186 $ — $ 186 Securitized beneficial interests — 14,648 14,648 — 17,736 17,736 — 40,332 40,332 Total assets $ 3 $ 14,648 $ 14,651 $ 6 $ 17,736 $ 17,742 $ 186 $ 40,332 $ 40,518 Liabilities Long-term debt $ 814,766 $ 623 $ 815,389 $ 863,620 $ 711 $ 864,331 $ 830,082 $ 703 $ 830,785 Guarantees — 3,136 3,136 — 3,544 3,544 — 3,714 3,714 Total liabilities $ 814,766 $ 3,759 $ 818,525 $ 863,620 $ 4,255 $ 867,875 $ 830,082 $ 4,417 $ 834,499 |
Schedule of Assets Measured on Recurring Basis | The following summarizes the reconciliation of changes in Level 3 instruments measured on a recurring basis: Three Months Ended June 30, 2019 Three Months Ended June 30, 2018 Securitized Beneficial Interests Guarantees Securitized Beneficial Interests Guarantees Beginning balance $ 40,332 $ 3,714 $ 48,715 $ 5,864 Issuances of sales of receivables/guarantees 46,882 293 48,685 244 Settlements (71,623) (879) (79,551) (2,701) (Losses) gains recognized in earnings (943) 8 (113) 137 Ending balance $ 14,648 $ 3,136 $ 17,736 $ 3,544 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following summarizes sales and purchases with related parties: Three Months Ended June 30, 2019 2018 Sales $ 7,504 $ 6,890 Purchases 21,355 26,267 |
Investee Companies (Tables)
Investee Companies (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | The following summarizes the Company's equity method investments as of June 30, 2019: Investee Name Location Primary Purpose The Company's Ownership Percentage Basis Difference Adams International Ltd. Thailand purchase and process tobacco 49 % — Alliance One Industries India Private Ltd. India purchase and process tobacco 49 % — China Brasil Tobacos Exportadora SA Brazil purchase and process tobacco 49 % 6,707 Criticality LLC U.S. extraction of cannabidiol from industrial hemp 40 % 913 Nicotine River, LLC U.S. produce consumable e-liquids 40 % 2,026 Oryantal Tutun Paketleme Turkey process tobacco 50 % — Purilum, LLC U.S. produce flavor formulations and consumable e-liquids 50 % — Siam Tobacco Export Company Thailand purchase and process tobacco 49 % — The following summarizes financial information for these investees for the three months ended June 30, 2019 and 2018: Three Months Ended June 30, Operations Statement Information 2019 2018 Sales $ 46,233 $ 47,226 Gross profit 9,507 7,767 Net income 3,100 2,044 Company's dividends received 6,094 — June 30, Balance Sheet Information 2019 2018 March 31, 2019 Current assets $ 236,389 $ 235,004 $ 152,661 Property, plant, and equipment and other assets 55,023 50,618 53,103 Current liabilities 184,526 172,263 89,791 Long-term obligations and other liabilities 3,354 4,622 3,222 Of the amounts presented above, the following summarizes financial information for China Brasil Tobacos Exportadora SA for the three months ended June 30, 2019 and 2018: Three Months Ended June 30, Operations Statement Information 2019 2018 Sales $ 18,391 $ 23,235 Gross profit 2,212 3,605 Net (loss) income (35) 780 Net (loss) income attributable to the investee (17) 382 |
Acquisition of Humble Juice C_2
Acquisition of Humble Juice Co., LLC (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Fair Values of Assets Acquired and Liabilities Assumed | The following summarizes the fair values of the assets acquired and liabilities assumed as of April 2, 2018: Cash and cash equivalents $ 308 Other receivables 56 Inventories 1,048 Other current assets 6 Property, plant, and equipment 8 Goodwill 7,174 Other intangible assets 5,950 Total assets acquired 14,550 Accounts payable 18 Total liabilities 18 Fair value of equity interest $ 14,532 |
Restructuring and Asset Impai_2
Restructuring and Asset Impairment Charges (Tables) | 3 Months Ended |
Jun. 30, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Charges | The following summarizes the restructuring actions: Three Months Ended June 30, 2019 2018 Employee separation charges $ 93 $ 1,198 Asset impairment and other non-cash charges 119 343 Restructuring and asset impairment charges $ 212 $ 1,541 The following summarizes the employee separation and other cash charges recorded in the Company's Leaf - North America and Leaf - Other Regions segments: Three Months Ended June 30, 2019 2018 Leaf - North America Leaf - Other Regions Leaf - North America Leaf - Other Regions Beginning balance $ 1,621 $ 222 $ — $ 107 Period charges 7 86 247 951 Payments (811) (94) — — Ending balance $ 817 $ 214 $ 247 $ 1,058 |
Schedule of Asset Impairment and Other Non-Cash Charges by Segment | The following summarizes the asset impairment and other non-cash charges for the Company's Leaf - North America and Leaf - Other Regions segments: Three Months Ended June 30, 2019 2018 Leaf - North America $ — $ — Leaf - Other Regions 119 343 Total $ 119 $ 343 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies - Narrative (Details) $ in Thousands | 3 Months Ended | |||
Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | |
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $ 164,135 | $ 192,043 | $ 202,107 | $ 264,660 |
Ratio of USD Exchange for Zimbabwe Real Time Gross Settlement System | 6.6 | |||
Zimbabwe | Cash Held in Real Time Gross Settlement System | ||||
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $ 0 | $ 1,082 | $ 2,638 |
Basis of Presentation and Sig_5
Basis of Presentation and Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Accounting Policies [Abstract] | |||
Compensating balance for short-term borrowings | $ 1,230 | $ 1,225 | $ 1,047 |
Capital investments | 0 | 0 | 850 |
Escrow | 1,397 | 2,894 | 0 |
Other | 899 | 1,648 | 866 |
Total | $ 3,526 | $ 5,767 | $ 2,763 |
Basis of Presentation and Sig_6
Basis of Presentation and Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | |
Accounting Policies [Abstract] | |||
Purchases of property, plant, and equipment included in accounts payable | $ 6,545 | $ 1,854 | $ 7,095 |
Sales of property, plant, and equipment included in notes receivable | $ 1,950 | $ 1,999 | $ 1,957 |
New Accounting Standards - Narr
New Accounting Standards - Narrative (Details) - Accounting Standards Update 2016-02 $ in Thousands | Apr. 01, 2019USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Right-of-use assets | $ 43,900 |
Lease liabilities | $ 42,064 |
Revenue Recognition - Revenue D
Revenue Recognition - Revenue Disaggregated by Product or Service (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | $ 276,670 | $ 290,989 |
Leaf Tobacco - North America Segment | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 34,950 | 50,052 |
Leaf Tobacco - North America Segment | Product revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 31,141 | 46,452 |
Leaf Tobacco - North America Segment | Processing and other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 3,809 | 3,600 |
Leaf Tobacco - Other Regions Segment | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 235,770 | 237,926 |
Leaf Tobacco - Other Regions Segment | Product revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 225,147 | 223,896 |
Leaf Tobacco - Other Regions Segment | Processing and other revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | 10,623 | 14,030 |
Other Products and Services Segment | ||
Disaggregation of Revenue [Line Items] | ||
Total sales and other operating revenues | $ 5,950 | $ 3,011 |
Revenue Recognition - Allowance
Revenue Recognition - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | ||
Balance at beginning of period | $ (13,381) | $ (7,055) |
Additions | 0 | (293) |
Writes-offs | 6,131 | 91 |
Balance at end of period | (7,250) | (7,257) |
Trade receivables | 200,326 | 204,091 |
Trade receivables, net | $ 193,076 | $ 196,834 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2016 | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Unrecognized tax benefits | $ 9,854 | ||
Unrecognized tax benefits that would impact effective tax rate | 7,575 | ||
Interest on income taxes accrued | 1,158 | ||
Income tax penalties accrued | $ 688 | ||
Effective income tax rate (as a percent) | (59.20%) | 92.70% | |
Income tax expense (benefit) | $ 23,453 | $ (25,270) | |
Non-U.S | |||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Income tax penalties accrued | $ 964 | ||
Income tax settlements | 1,558 | ||
Reduction of income tax penalties accrued | 818 | ||
Income tax expense (benefit) | $ (2,601) | $ 3,906 | |
Non-U.S | Minimum | |||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Income tax examination, open tax years | 3 years | ||
Non-U.S | Maximum | |||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||
Income tax examination, open tax years | 6 years |
Guarantees - Summary (Details)
Guarantees - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | |
Guarantor Obligations [Line Items] | |||
Amounts guaranteed (not to exceed) | $ 127,738 | $ 143,298 | $ 153,347 |
Amounts outstanding under guarantee | 90,535 | 103,846 | 84,116 |
Fair value of guarantees | $ 3,136 | 3,714 | 3,544 |
Number of years before expiring guarantees | 1 year | ||
Financial Guarantee | |||
Guarantor Obligations [Line Items] | |||
Amounts outstanding under guarantee | $ 24,131 | $ 18,659 | $ 18,652 |
Goodwill and Intangibles - Inta
Goodwill and Intangibles - Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Mar. 31, 2019 | |
Schedule of Intangible Assets [Line Items] | ||
Beginning Gross Carrying Amount | $ 165,910 | $ 150,120 |
Additions | 273 | 17,220 |
Accumulated Amortization | (61,639) | (59,793) |
Impact of Foreign Currency Translation | 781 | (1,430) |
Ending Intangible Assets, Net | 105,325 | 106,117 |
Amortization of intangible assets | $ 1,846 | $ 7,943 |
Customer relationships | ||
Schedule of Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 9 years 3 months 18 days | 9 years 7 months 6 days |
Beginning Gross Carrying Amount | $ 63,980 | $ 58,530 |
Additions | 0 | 5,450 |
Accumulated Amortization | (30,032) | (29,027) |
Impact of Foreign Currency Translation | 0 | 0 |
Ending Intangible Assets, Net | $ 33,948 | $ 34,953 |
Production and supply contracts | ||
Schedule of Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 2 years 8 months 12 days | 2 years 10 months 24 days |
Beginning Gross Carrying Amount | $ 14,893 | $ 14,893 |
Additions | 0 | 0 |
Accumulated Amortization | (10,892) | (10,668) |
Impact of Foreign Currency Translation | 0 | 0 |
Ending Intangible Assets, Net | $ 4,001 | $ 4,225 |
Internally developed software | ||
Schedule of Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 3 years 9 months 18 days | 3 years 9 months 18 days |
Beginning Gross Carrying Amount | $ 19,917 | $ 18,812 |
Additions | 205 | 1,105 |
Accumulated Amortization | (18,531) | (18,391) |
Impact of Foreign Currency Translation | 0 | 0 |
Ending Intangible Assets, Net | $ 1,591 | $ 1,526 |
Licenses | ||
Schedule of Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 17 years 10 months 24 days | 18 years 1 month 6 days |
Beginning Gross Carrying Amount | $ 32,284 | $ 30,339 |
Additions | 68 | 2,991 |
Accumulated Amortization | (2,106) | (1,644) |
Impact of Foreign Currency Translation | 570 | (1,046) |
Ending Intangible Assets, Net | $ 30,816 | $ 30,640 |
Trade names | ||
Schedule of Intangible Assets [Line Items] | ||
Weighted Average Remaining Useful Life | 6 years 9 months 18 days | 7 years |
Beginning Gross Carrying Amount | $ 500 | $ 0 |
Additions | 0 | 500 |
Accumulated Amortization | (78) | (63) |
Impact of Foreign Currency Translation | 0 | 0 |
Ending Intangible Assets, Net | 422 | 437 |
Goodwill | ||
Schedule of Intangible Assets [Line Items] | ||
Beginning Gross Carrying Amount | 34,336 | 27,546 |
Additions | 0 | 7,174 |
Impact of Foreign Currency Translation | 211 | (384) |
Ending Intangible Assets, Net | $ 34,547 | $ 34,336 |
Goodwill and Intangibles - Esti
Goodwill and Intangibles - Estimated Intangible Asset Amortization Expense (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | $ 6,774 |
2021 | 7,665 |
2022 | 6,806 |
2023 | 6,157 |
2024 | 6,038 |
Later | 37,338 |
Total estimated future intangible asset amortization expense | 70,778 |
Customer Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | 3,017 |
2021 | 4,022 |
2022 | 4,022 |
2023 | 4,022 |
2024 | 4,022 |
Later | 14,843 |
Total estimated future intangible asset amortization expense | 33,948 |
Production and Supply Contracts | |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | 1,992 |
2021 | 1,397 |
2022 | 612 |
2023 | 0 |
2024 | 0 |
Later | 0 |
Total estimated future intangible asset amortization expense | 4,001 |
Internally Developed Software Intangible | |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | 375 |
2021 | 394 |
2022 | 322 |
2023 | 289 |
2024 | 170 |
Later | 41 |
Total estimated future intangible asset amortization expense | 1,591 |
Licenses | |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | 1,342 |
2021 | 1,789 |
2022 | 1,787 |
2023 | 1,783 |
2024 | 1,783 |
Later | 22,332 |
Total estimated future intangible asset amortization expense | 30,816 |
Trade Names | |
Finite-Lived Intangible Assets [Line Items] | |
July 1, 2019 through March 31, 2020 | 48 |
2021 | 63 |
2022 | 63 |
2023 | 63 |
2024 | 63 |
Later | 122 |
Total estimated future intangible asset amortization expense | $ 422 |
Variable Interest Entities - Su
Variable Interest Entities - Summary (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Variable Interest Entity [Line Items] | |||
Investment in variable interest entities | $ 64,535 | $ 69,459 | $ 67,898 |
Advances to variable interest entities | 17,239 | 5,783 | 12,375 |
Variable Interest Entity, Not Primary Beneficiary | |||
Variable Interest Entity [Line Items] | |||
Investment in variable interest entities | 57,541 | 64,281 | 63,021 |
Advances to variable interest entities | 14,500 | 3,273 | 9,937 |
Guaranteed amounts to variable interest entities (not to exceed) | $ 63,584 | $ 67,027 | $ 71,919 |
Segment Information - Summary (
Segment Information - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Total sales and other operating revenues | $ 276,670 | $ 290,989 | |
Total operating (loss) income | (6,929) | 4,691 | |
Total assets | 1,965,575 | 2,129,366 | $ 1,859,275 |
Leaf Tobacco - North America Segment | |||
Segment Reporting Information [Line Items] | |||
Total sales and other operating revenues | 34,950 | 50,052 | |
Total operating (loss) income | 762 | 1,293 | |
Total assets | 257,707 | 300,307 | 243,248 |
Leaf Tobacco - Other Regions Segment | |||
Segment Reporting Information [Line Items] | |||
Total sales and other operating revenues | 235,770 | 237,926 | |
Total operating (loss) income | 7,034 | 7,654 | |
Total assets | 1,540,147 | 1,735,490 | 1,488,226 |
Other Products and Services Segment | |||
Segment Reporting Information [Line Items] | |||
Total sales and other operating revenues | 5,950 | 3,011 | |
Total operating (loss) income | (14,725) | (4,256) | |
Total assets | $ 167,721 | $ 93,569 | $ 127,801 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - $ / shares shares in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Shares of common stock owned by the subsidiary (shares) | 785 | 785 |
Stock Options | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (shares) | 427 | 427 |
Weighted average exercise price of antidilutive shares (USD per share) | $ 60 | $ 60 |
Earnings Per Share - Summary (D
Earnings Per Share - Summary (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Basic (loss) income per share: | ||
Net income attributable to Pyxus International, Inc. | $ (61,797) | $ (759) |
Weighted average number of shares outstanding (shares) | 9,100 | 9,027 |
Basic (loss) income per share (USD per share) | $ (6.79) | $ (0.08) |
Diluted (loss) income per share: | ||
Net income attributable to Pyxus International, Inc. | $ (61,797) | $ (759) |
Weighted average number of shares outstanding (shares) | 9,100 | 9,027 |
Plus: Restricted shares issued and shares applicable to stock options and restricted stock units, net of shares assumed to be purchased from proceeds at average market price (shares) | 0 | 0 |
Adjusted weighted average number of common shares outstanding (shares) | 9,100 | 9,027 |
Diluted (loss) income per share (USD per share) | $ (6.79) | $ (0.08) |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) | 3 Months Ended |
Jun. 30, 2019 | |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting period | 3 years |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 429 | $ 295 |
Stock-based Awards Payable in Cash | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 0 | $ 0 |
Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number granted (shares) | 13 | 7 |
Grant date fair value (USD per share) | $ 15.20 | $ 15.85 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number granted (shares) | 2 | 61 |
Grant date fair value (USD per share) | $ 18.29 | $ 16 |
Performance-based stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number granted (shares) | 0 | 30 |
Grant date fair value (USD per share) | $ 0 | $ 16 |
Contingencies and Other Infor_2
Contingencies and Other Information - Narrative (Details) $ in Thousands | 3 Months Ended | 24 Months Ended | ||||
Jun. 30, 2019USD ($)facility | Sep. 30, 2018 | Mar. 31, 2013USD ($) | Dec. 31, 2005USD ($) | Mar. 18, 2014USD ($) | Oct. 26, 2007USD ($) | |
Loss Contingencies [Line Items] | ||||||
Amount of federal taxes offset | $ 24,142 | |||||
Decrease in sales and other operating revenues (as a percent) | 12.00% | |||||
Number of facilities with an associated asset retirement obligation | facility | 1 | |||||
Other Income (Expense) | ||||||
Loss Contingencies [Line Items] | ||||||
Benefit of excise tax | $ 24,142 | |||||
IPI Credit Bonus | ||||||
Loss Contingencies [Line Items] | ||||||
Gain contingency, unrecorded amount | $ 94,316 | |||||
Tax Assessment | Brazilian State of Parana | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, estimate of possible loss | $ 12,041 | $ 3,437 | ||||
Tax Assessment | Brazilian State of Santa Catarina | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, estimate of possible loss | 7,862 | $ 2,973 | ||||
Tax Assessment | Brazil State of Rio Grande do Sul and the State of Santa Catarina | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, estimate of possible loss | $ 10,782 |
Debt Arrangements - Narrative (
Debt Arrangements - Narrative (Details) | 3 Months Ended |
Jun. 30, 2019 | |
Debt Instrument [Line Items] | |
EBITDA to fixed charges ratio requirement | 2 |
Senior Notes | Senior Secured First Lien Notes Due 2021 | |
Debt Instrument [Line Items] | |
Stated interest rate (as a percent) | 8.50% |
Senior Notes | Senior Secured Second Lien Notes Due 2021 | |
Debt Instrument [Line Items] | |
Stated interest rate (as a percent) | 9.875% |
Leases - Narrative (Details)
Leases - Narrative (Details) | Jun. 30, 2019 |
Minimum | Real Estate | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 2 years |
Minimum | Equipment | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 2 years |
Maximum | Real Estate | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 15 years |
Maximum | Equipment | |
Lessee, Lease, Description [Line Items] | |
Initial term of operating leases | 5 years |
Leases - Weighted-Average Infor
Leases - Weighted-Average Information of Operating Lease Obligations (Details) | Jun. 30, 2019 |
Leases [Abstract] | |
Weighted-average remaining lease term | 5 years 3 months 18 days |
Weighted-average discount rate (as a percent) | 9.50% |
Leases - Lease Costs (Details)
Leases - Lease Costs (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Leases [Abstract] | |
Operating lease costs | $ 4,188 |
Variable and short-term lease costs | 1,468 |
Total lease costs | $ 5,656 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities | |
Operating cash flows impact - operating leases | $ 4,140 |
Right-of-use assets obtained in exchange for new operating leases | $ 1,578 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Operating Leases, After Adoption of 842: | |||
2020 (excluding the three months ended June 30, 2019) | $ 11,672 | ||
2021 | 14,328 | ||
2022 | 10,462 | ||
2023 | 6,117 | ||
2024 | 4,982 | ||
Thereafter | 11,772 | ||
Total future minimum lease payments | 59,333 | ||
Less: amounts related to imputed interest | 15,182 | ||
Present value of future minimum lease payments | 44,151 | ||
Less: operating lease liabilities, current | 15,275 | $ 0 | $ 0 |
Operating lease liabilities, non-current | $ 28,876 | $ 0 | $ 0 |
Leases - Future Minimum Rental
Leases - Future Minimum Rental Commitments under Noncancelable Operating Leases (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Operating Leases, Before Adoption of 842: | |
2020 | $ 15,651 |
2021 | 10,554 |
2022 | 8,483 |
2023 | 6,735 |
2024 | 5,356 |
Thereafter | 7,324 |
Total | $ 54,103 |
Derivative Financial Instrume_2
Derivative Financial Instruments - Narrative (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative [Line Items] | ||
Gain (loss) recognized in income | $ (651,000) | $ 0 |
Current derivative asset | 3,000 | 6,000 |
Notional amount of derivative contracts | 32,574,000 | |
Loss on Derivatives | ||
Derivative [Line Items] | ||
Accumulated other comprehensive loss | (2,245,000) | (1,496,000) |
Tax on accumulated other comprehensive loss | $ 98,000 | $ 398,000 |
Pension and Other Postretirem_3
Pension and Other Postretirement Benefits - Narrative (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2019USD ($) | |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Contributions by employer | $ 1,463 |
Additional contributions to the plans | 5,171 |
Other Postretirement Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Contributions by employer | 102 |
Additional contributions to the plans | $ 386 |
Pension and Other Postretirem_4
Pension and Other Postretirement Benefits - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Pension Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | $ 117 | $ 120 |
Interest expense | 1,029 | 1,155 |
Expected return on plan assets | (1,121) | (1,286) |
Amortization of prior service cost | 10 | 11 |
Actuarial loss | 456 | 422 |
Net periodic pension cost | 491 | 422 |
Other Postretirement Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Service cost | 2 | 4 |
Interest expense | 82 | 83 |
Amortization of prior service cost | (177) | (177) |
Actuarial loss | 109 | 109 |
Net periodic pension cost | $ 16 | $ 19 |
Inventories - Summary (Details)
Inventories - Summary (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Inventory Disclosure [Abstract] | |||
Processed tobacco | $ 554,165 | $ 455,303 | $ 563,539 |
Unprocessed tobacco | 238,653 | 186,108 | 330,227 |
Other | 24,845 | 26,760 | 23,162 |
Total | $ 817,663 | $ 668,171 | $ 916,928 |
Other Comprehensive Loss - Comp
Other Comprehensive Loss - Components Reclassified from AOCI to Earnings (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Pensions and other postretirement benefits | ||
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items] | ||
Amounts reclassified from accumulated other comprehensive loss to net income, gross | $ 395 | $ 366 |
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income | (84) | 0 |
Amounts reclassified from accumulated other comprehensive loss to net income, net | 311 | 366 |
Actuarial loss | ||
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items] | ||
Amounts reclassified from accumulated other comprehensive loss to net income, gross | 560 | 533 |
Amortization of prior service cost | ||
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items] | ||
Amounts reclassified from accumulated other comprehensive loss to net income, gross | (165) | (167) |
Derivatives | ||
Reclassification Out Of Accumulated Other Comprehensive Income [Line Items] | ||
Amounts reclassified from accumulated other comprehensive loss to net income, gross | 651 | 0 |
Tax effects of amounts reclassified from accumulated other comprehensive loss to net income | (137) | 0 |
Amounts reclassified from accumulated other comprehensive loss to net income, net | $ 514 | $ 0 |
Sale of Receivables - Narrative
Sale of Receivables - Narrative (Details) | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2019USD ($)program | Jun. 30, 2018USD ($) | Mar. 31, 2019USD ($) | |
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Number of accounts receivable securitization programs | program | 2 | ||
Receivables sold, face value discounted (as a percent) | 100.00% | ||
Reductions of trade and other receivables due to settlements | $ (6,348,000) | $ (8,559,000) | $ (5,208,000) |
Accounts Receivable Securitization, Program One | |||
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Trade receivables, maximum amount | 155,000,000 | ||
Accounts Receivable Securitization, Program Two | |||
Derecognized Assets, Securitized or Asset-backed Financing Arrangement Assets and any Other Financial Assets Managed Together [Line Items] | |||
Trade receivables, maximum amount | $ 125,000,000 | $ 125,000,000 |
Sale of Receivables - Summary (
Sale of Receivables - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | |
Transfers and Servicing [Abstract] | |||
Receivables outstanding in facility | $ 78,258 | $ 79,179 | $ 210,672 |
Beneficial interest | 14,648 | 17,736 | 40,332 |
Servicing liability | 0 | 8 | 90 |
Cash proceeds for the three months ended: | |||
Cash purchase price | 103,517 | 101,080 | 672,333 |
Deferred purchase price | 72,266 | 76,240 | 242,966 |
Service fees | 137 | 180 | 576 |
Total | $ 175,920 | $ 177,500 | $ 915,875 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2019USD ($) | |
Guarantees of Farmers | Discounted Cash Flow Valuation Technique | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Market interest rate (as a percent) | 15.00% | ||
Securitized Beneficial Interests | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Payment speed | 84 days | ||
Discount rate (as a percent) | 4.90% | ||
Unrealized losses for securitized beneficial interests | $ 946 | $ 801 | $ 1,289 |
Loss Severity | Guarantees of Farmers | Historical Loss Valuation Technique | Minimum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Historical loss (as a percent) | 0.024 | ||
Loss Severity | Guarantees of Farmers | Historical Loss Valuation Technique | Maximum | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis, Valuation Techniques [Line Items] | |||
Historical loss (as a percent) | 0.100 |
Fair Value Measurements - Input
Fair Value Measurements - Input Hierarchy of Items Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 |
Total Assets / Liabilities at Fair Value | |||
Assets | |||
Derivative financial instruments | $ 3 | $ 186 | $ 6 |
Securitized beneficial interests | 14,648 | 40,332 | 17,736 |
Total assets | 14,651 | 40,518 | 17,742 |
Liabilities | |||
Long-term debt | 815,389 | 830,785 | 864,331 |
Guarantees | 3,136 | 3,714 | 3,544 |
Total liabilities | 818,525 | 834,499 | 867,875 |
Level 2 | |||
Assets | |||
Derivative financial instruments | 3 | 186 | 6 |
Securitized beneficial interests | 0 | 0 | 0 |
Total assets | 3 | 186 | 6 |
Liabilities | |||
Long-term debt | 814,766 | 830,082 | 863,620 |
Guarantees | 0 | 0 | 0 |
Total liabilities | 814,766 | 830,082 | 863,620 |
Level 3 | |||
Assets | |||
Derivative financial instruments | 0 | 0 | 0 |
Securitized beneficial interests | 14,648 | 40,332 | 17,736 |
Total assets | 14,648 | 40,332 | 17,736 |
Liabilities | |||
Long-term debt | 623 | 703 | 711 |
Guarantees | 3,136 | 3,714 | 3,544 |
Total liabilities | $ 3,759 | $ 4,417 | $ 4,255 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Change in Recurring Level 3 Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Securitized Beneficial Interests | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 40,332 | $ 48,715 |
Issuances of sales of receivables/guarantees | 46,882 | 48,685 |
Settlements | (71,623) | (79,551) |
(Losses) gains recognized in earnings | (943) | (113) |
Ending balance | 14,648 | 17,736 |
Guarantees | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | 3,714 | 5,864 |
Issuances of sales of receivables/guarantees | 293 | 244 |
Settlements | (879) | (2,701) |
(Losses) gains recognized in earnings | 8 | 137 |
Ending balance | $ 3,136 | $ 3,544 |
Related Party Transactions - Su
Related Party Transactions - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Related Party Transactions [Abstract] | ||
Sales | $ 7,504 | $ 6,890 |
Purchases | $ 21,355 | $ 26,267 |
Investee Companies - Summary (D
Investee Companies - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Mar. 31, 2019 | |
Operations Statement Information | |||
Sales | $ 46,233 | $ 47,226 | |
Gross profit | 9,507 | 7,767 | |
Net income | 3,100 | 2,044 | |
Company's dividends received | 6,094 | 0 | |
Balance Sheet Information | |||
Current assets | 236,389 | 235,004 | $ 152,661 |
Property, plant, and equipment and other assets | 55,023 | 50,618 | 53,103 |
Current liabilities | 184,526 | 172,263 | 89,791 |
Long-term obligations and other liabilities | $ 3,354 | 4,622 | $ 3,222 |
Adams International Ltd. | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 49.00% | ||
Basis difference | $ 0 | ||
Alliance One Industries India Private Ltd. | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 49.00% | ||
Basis difference | $ 0 | ||
China Brasil Tobacos Exportadora SA | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 49.00% | ||
Basis difference | $ 6,707 | ||
Operations Statement Information | |||
Sales | 18,391 | 23,235 | |
Gross profit | 2,212 | 3,605 | |
Net income | (35) | 780 | |
Net (loss) income attributable to the investee | $ (17) | $ 382 | |
Criticality LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 40.00% | ||
Basis difference | $ 913 | ||
Nicotine River, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 40.00% | ||
Basis difference | $ 2,026 | ||
Oryantal Tutun Paketleme | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 50.00% | ||
Basis difference | $ 0 | ||
Purilum, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 50.00% | ||
Basis difference | $ 0 | ||
Siam Tobacco Export Company | |||
Schedule of Equity Method Investments [Line Items] | |||
Ownership in equity method investment (as a percent) | 49.00% | ||
Basis difference | $ 0 |
Acquisition of Humble Juice C_3
Acquisition of Humble Juice Co., LLC - Narrative (Details) - Humble Juice - USD ($) $ / shares in Units, $ in Thousands | Apr. 02, 2018 | Jun. 30, 2018 |
Business Acquisition [Line Items] | ||
Ownership interest acquired (as a percent) | 51.00% | |
Cash consideration transferred | $ 9,000 | |
Contingent consideration | 446 | |
Fair value of non-controlling interest | 5,086 | |
Acquisition-related costs | $ 12 | |
Revenue of acquiree | $ 2,487 | |
Operating loss of acquiree | (501) | |
Net loss of acquiree | $ (256) | |
Pro forma earnings per share, basic (USD per share) | $ (0.03) | |
Pro forma earnings per share, diluted (USD per share) | $ (0.03) |
Acquisition of Humble Juice C_4
Acquisition of Humble Juice Co., LLC - Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Apr. 02, 2018 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 34,547 | $ 34,336 | $ 34,487 | |
Humble Juice | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 308 | |||
Other receivables | 56 | |||
Inventories | 1,048 | |||
Other current assets | 6 | |||
Property, plant, and equipment | 8 | |||
Goodwill | 7,174 | |||
Other intangible assets | 5,950 | |||
Total assets acquired | 14,550 | |||
Accounts payable | 18 | |||
Total liabilities | 18 | |||
Fair value of equity interest | $ 14,532 |
Restructuring and Asset Impai_3
Restructuring and Asset Impairment Charges - Restructuring Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | ||
Employee separation charges | $ 93 | $ 1,198 |
Asset impairment and other non-cash charges | 119 | 343 |
Restructuring and asset impairment charges | $ 212 | $ 1,541 |
Restructuring and Asset Impai_4
Restructuring and Asset Impairment Charges - Employee Separation and Other Cash Charges by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Restructuring Reserve [Roll Forward] | ||
Period charges | $ 93 | $ 1,198 |
Leaf Tobacco - North America Segment | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 1,621 | 0 |
Period charges | 7 | 247 |
Payments | (811) | 0 |
Ending balance | 817 | 247 |
Leaf Tobacco - Other Regions Segment | ||
Restructuring Reserve [Roll Forward] | ||
Beginning balance | 222 | 107 |
Period charges | 86 | 951 |
Payments | (94) | 0 |
Ending balance | $ 214 | $ 1,058 |
Restructuring and Asset Impai_5
Restructuring and Asset Impairment Charges - Asset Impairment and Non-Cash Charges by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment and other non-cash charges | $ 119 | $ 343 |
Leaf Tobacco - North America Segment | ||
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment and other non-cash charges | 0 | 0 |
Leaf Tobacco - Other Regions Segment | ||
Restructuring Cost and Reserve [Line Items] | ||
Asset impairment and other non-cash charges | $ 119 | $ 343 |