Delaware | 95-3015862 |
(State of incorporation) | (I.R.S. Employer Identification No.) |
Title of each class | Name of each exchange on which registered |
Common Stock, par value $0.01 per share | New York Stock Exchange |
Large accelerated filer x | Accelerated filer o |
Non-accelerated filer o | Smaller reporting company o |
(Do not check if a smaller reporting company) |
Page | ||
Item 1B. | Unresolved Staff Comments | * |
Item 4. | Mine Safety Disclosures | * |
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | * |
Item 9B. | Other Information | * |
• | the results of our retail store fleet optimization and brand office consolidation; |
• | the successful implementation of our Business Transformation Project, as defined herein; |
• | our global business, growth, operating, investing, and financing strategies; |
• | our product offerings, distribution channels, and geographic mix; |
• | the success of new products, brands, and growth initiatives; |
• | the impact of seasonality and weather on our operations; |
• | expectations regarding our net sales and earnings growth and other financial metrics; |
• | our development of worldwide distribution channel; |
• | trends affecting our financial condition, results of operations, or cash flows; |
• | our expectations for expansion of our Direct-to-Consumer (DTC) capabilities; |
• | overall global economic trends including foreign currency exchange rate fluctuations; |
• | reliability of overseas factory production and storage; |
• | the availability and cost of raw materials; and |
• | the impact of recent accounting pronouncements. |
• | “UGG Rewards”: We have implemented a consumer loyalty program under which points and awards are earned across the DTC channel. |
• | “Infinite UGG”: We provide online shopping access, inside retail stores, for all SKUs available on our E-Commerce websites. |
• | “Buy online / return in-store”: Our consumers can buy online and return unwanted products to the store. |
• | “Click and collect”: Our consumers can buy online and have products delivered to certain of our retail stores for pick-up. |
• | “Retail inventory online”: Our consumers can view specific store location inventory online before visiting the store. |
• | predict and respond to changing consumer preferences and tastes in a timely manner; |
• | produce products that appeal to consumers; |
• | produce products that meet our requirements and consumer expectations for quality; |
• | accurately predict and forecast consumer demand; |
• | ensure product availability; |
• | manage the impact of seasonality, including unexpected changes in weather conditions; |
• | maintain brand loyalty and authenticity; |
• | price our products in a competitive manner; |
• | implement our Omni-Channel strategy, including providing a unique customer service experience; |
• | implement our Business Transformation Project in a cost-effective manner; and |
• | manage the impact on our business of the rapidly changing retail environment. |
• | consumer acceptance of our products; |
• | consumer demand for products of our competitors; |
• | the extent to which consumers view certain of our products as substitutes for other products we manufacture; |
• | the lifecycle of our products and consumer replenishment behavior; |
• | evolving fashion and lifestyle trends, and the extent to which our products reflect these trends; |
• | brand loyalty; |
• | seasonality, including the impact of anticipated and unanticipated weather conditions; |
• | our reliance on manual processes and judgment for certain manufacturing and inventory planning functions; |
• | changes in consumer confidence and buying patterns, and other factors that impact discretionary income and spending; and |
• | changes in general economic and market conditions. |
• | predict and respond to changing consumer preferences and tastes in a timely manner; |
• | produce products that appeal to consumers; |
• | produce products that meet our requirements and consumer expectations for quality; |
• | accurately predict and forecast consumer demand; |
• | ensure product availability; |
• | manage the impact of seasonality, including unexpected changes in weather conditions; |
• | maintain brand loyalty and authenticity; |
• | price our products in a competitive manner; |
• | implement our Omni-Channel strategy, including providing a unique customer service experience; |
• | implement our Business Transformation Project in a cost-effective manner; and |
• | manage the impact on our business of the rapidly changing retail environment. |
• | expose us to risks inherent in entering a new market or geographic region; |
• | lose significant customers or key personnel of the acquired business; |
• | encounter difficulties managing geographically-remote operations; |
• | divert management’s time and attention away from other aspects of our business operations; |
• | issue equity securities to finance the acquisition, which would be dilutive to our existing stockholders; |
• | incur indebtedness to finance the acquisition, which would result in debt service costs and potentially include covenants restricting our operations; and |
• | incur costs relating to a potential acquisition that we fail to consummate, which we may not be able to recover. |
• | tariffs, import and export controls, and other non-tariff barriers such as quotas and local content rules on raw materials and finished products; |
• | increasing transportation costs and a limited supply of international shipping capacity; |
• | delays during shipping, at the port of entry or at the port of departure; |
• | increasing labor costs and labor disruptions; |
• | poor infrastructure and shortages of equipment, which can disrupt transportation and utilities; |
• | restrictions on the transfer of funds from foreign jurisdictions; |
• | changing economic and market conditions; |
• | changes in governmental policies and regulations including intellectual property, labor, safety, and environmental regulations; |
• | refusal to adopt or comply with our Supplier Code of Conduct, Conflict Minerals Policy and Restricted Substances Policy; |
• | customary business traditions in China and Vietnam such as local holidays, which are traditionally accompanied by high levels of turnover in the factories; |
• | decreased scrutiny by custom officials for counterfeit products; |
• | political instability, which can interrupt commerce, including acts of war and other external factors, over which we have no control; |
• | heightened terrorism security concerns, which could subject imported or exported products to more frequent or more lengthy inspections; |
• | use of unauthorized or prohibited materials or reclassification of materials; |
• | disease epidemics and health-related concerns that could result in a reduced workforce or scarcity of raw materials; |
• | disruptions at manufacturing or distribution facilities caused by natural or other disasters; and |
• | adverse changes in consumer perception of goods, trade, or political relations with China or Vietnam. |
• | changes in foreign currency exchange rates, which impact the prices at which products are sold to international consumers; |
• | limitations on our ability to move currency out of international markets; |
• | burdens of complying with a variety of foreign laws and regulations, which may change unexpectedly, and the interpretation and application of which are uncertain; |
• | legal costs and penalties related to defending allegations of non-compliance with foreign government policies, laws and regulations; |
• | inability to import products into a foreign country; |
• | changes in US and foreign tax laws; |
• | complications due to lack of familiarity with local customs; |
• | difficulties associated with promoting and marketing products in unfamiliar cultures; |
• | political instability; |
• | changes in diplomatic and trade relationships between the US and other countries; and |
• | general economic fluctuations in specific countries or markets. |
• | critical business systems become inoperable or require significant costs to restore; |
• | key personnel are unable to perform their duties, communicate, or access information systems; |
• | significant quantities of merchandise are damaged or destroyed; |
• | we are required to make unanticipated investment in state-of-the-art technologies and security measures; |
• | key wholesale and distributor customers cannot place or receive orders; |
• | E-Commerce customer orders may not be received or fulfilled; |
• | confidential information about our customers may be misappropriated or lost damaging our reputation and customer relationships; |
• | we are exposed to unanticipated liabilities; or |
• | carriers cannot ship or unload shipments. |
• | changes in expectations of our future performance, whether realized or perceived; |
• | changes in estimates by securities analysts or failure to meet such estimates; |
• | published research and opinions by securities analysts and other market forecasters; |
• | quarterly fluctuations in our sales, margins, expenses, and financial results; |
• | the financial results and liquidity of our customers; |
• | the shift of revenue recognition as a result of changes in our distribution model; |
• | claims brought against us by a regulatory agency or our stockholders; |
• | announcements to repurchase our stock; |
• | the declaration of stock or cash dividends; |
• | general market and economic conditions; |
• | consumer confidence; |
• | broad market fluctuations in volume and price; and |
• | a variety of risk factors, including the ones described elsewhere in this Annual Report on Form 10-K and in our other filings with the SEC. |
• | authorize the issuance of preferred stock with powers, preferences and rights that may be senior to our common stock, which can be created and issued by our Board of Directors without prior stockholder approval; |
• | provide that the number of directors will be fixed by the affirmative vote of a majority of the whole Board of Directors; |
• | provide that board vacancies can only be filled by directors; |
• | prohibit stockholders from acting by written consent without holding a meeting of stockholders; |
• | require the vote of holders of not less than 66 2/3% of the voting stock then outstanding to approve amendments to our Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws; and |
• | require advance written notice of stockholder proposals and director nominations. |
Facility Location | Description | Lease or Own | Facility Size (Square Footage) | ||||
Moreno Valley, California | Warehouse Facility | Lease | 794,000 | ||||
Camarillo, California | Warehouse Facility | Lease | 723,000 | ||||
Goleta, California | Corporate Offices | Own | 196,000 |
Common Stock Price Per Share | |||||||
Low | High | ||||||
Year ended March 31, 2016 | |||||||
First Quarter | $ | 68.15 | $ | 76.58 | |||
Second Quarter | 56.75 | 74.37 | |||||
Third Quarter | 46.30 | 62.16 | |||||
Fourth Quarter | 42.27 | 60.55 | |||||
Year ended March 31, 2015 | |||||||
First Quarter | $ | 76.11 | $ | 86.33 | |||
Second Quarter | 81.53 | 99.38 | |||||
Third Quarter | 81.56 | 98.57 | |||||
Fourth Quarter | 66.05 | 94.10 |
12/31/2010 | 12/31/2011 | 12/31/2012 | 12/31/2013 | 3/31/2015 | 3/31/2016 | ||||||||||||||||||
Deckers Outdoor Corporation | $ | 100.0 | $ | 94.8 | $ | 50.5 | $ | 105.9 | $ | 91.4 | $ | 75.1 | |||||||||||
S&P 500 Apparel, Accessories & Luxury Goods Index | 100.0 | 124.4 | 127.6 | 159.4 | 152.2 | 135.1 | |||||||||||||||||
The NYSE Composite Index* | 100.0 | 96.4 | 112.1 | 141.7 | 155.5 | 149.6 |
Total number of shares purchased* (in thousands) | Average price paid per share | Approximate dollar value of shares added/(purchased) (in thousands) | Approximate dollar value of shares that may yet be purchased (in thousands) | |||||||||||
December 31, 2013 | $ | 79,300 | ||||||||||||
January 1, 2014 — September 30, 2014 | — | $ | — | $ | — | 79,300 | ||||||||
October 1, 2014 — October 31, 2014 | 157 | 84.66 | (13,300 | ) | 66,000 | |||||||||
January 1, 2015 — January 31, 2015 | — | — | 200,000 | 266,000 | ||||||||||
February 1, 2015 — February 28, 2015 | 1,089 | 73.41 | (79,900 | ) | 186,100 | |||||||||
March 1, 2015 — March 31, 2015 | 190 | 73.73 | (14,000 | ) | 172,100 | |||||||||
June 1, 2015 — June 30, 2015 | 625 | 72.69 | (45,400 | ) | 126,700 | |||||||||
August 1, 2015 — August 31, 2015 | 321 | 67.68 | (21,700 | ) | 105,000 | |||||||||
September 1, 2015 — September 30, 2015 | 33 | 62.32 | (2,100 | ) | 102,900 | |||||||||
February 1, 2016 — February 29, 2016 | 266 | 56.41 | (15,000 | ) | 87,900 | |||||||||
March 1, 2016 — March 31, 2016 | 175 | 56.97 | (10,000 | ) | 77,900 | |||||||||
Total | 2,856 | $ | 67.95 |
• | Consolidated statements of comprehensive income (loss) for the years ended March 31, 2016, March 31, 2015 and December 31, 2013 and the transition quarter ended March 31, 2014. |
Years ended March 31, | Quarter ended (transition period) March 31, | Years ended December 31, | |||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||||
(In thousands, except per share data) | |||||||||||||||||||||||
Statements of operations data | |||||||||||||||||||||||
Net sales: | |||||||||||||||||||||||
UGG wholesale | $ | 918,102 | $ | 903,926 | $ | 83,271 | $ | 818,377 | $ | 819,256 | $ | 915,203 | |||||||||||
Teva wholesale | 121,239 | 116,931 | 45,283 | 109,334 | 108,591 | 118,742 | |||||||||||||||||
Sanuk wholesale | 90,719 | 102,690 | 28,793 | 94,420 | 89,804 | 26,039 | |||||||||||||||||
Other brands wholesale | 100,820 | 76,152 | 18,662 | 38,276 | 20,194 | 21,801 | |||||||||||||||||
Direct-to-Consumer | 644,317 | 617,358 | 118,707 | 496,211 | 376,553 | 295,498 | |||||||||||||||||
Total net sales | 1,875,197 | 1,817,057 | 294,716 | 1,556,618 | 1,414,398 | 1,377,283 | |||||||||||||||||
Cost of sales | 1,028,529 | 938,949 | 150,456 | 820,135 | 782,244 | 698,288 | |||||||||||||||||
Gross profit | 846,668 | 878,108 | 144,260 | 736,483 | 632,154 | 678,995 | |||||||||||||||||
Selling, general and administrative expenses | 684,541 | 653,689 | 144,668 | 528,586 | 445,206 | 394,157 | |||||||||||||||||
Income (loss) from operations | 162,127 | 224,419 | (408 | ) | 207,897 | 186,948 | 284,838 | ||||||||||||||||
Other expense (income), net | 5,242 | 3,280 | 334 | 2,340 | 2,830 | (424 | ) | ||||||||||||||||
Income (loss) before income taxes | 156,885 | 221,139 | (742 | ) | 205,557 | 184,118 | 285,262 | ||||||||||||||||
Income taxes | 34,620 | 59,359 | 1,943 | 59,868 | 55,104 | 83,404 | |||||||||||||||||
Net income (loss) | 122,265 | 161,780 | (2,685 | ) | 145,689 | 129,014 | 201,858 | ||||||||||||||||
Net income attributable to noncontrolling interest | — | — | — | — | (148 | ) | (2,806 | ) | |||||||||||||||
Net income (loss) attributable to Deckers Outdoor Corporation | $ | 122,265 | $ | 161,780 | $ | (2,685 | ) | $ | 145,689 | $ | 128,866 | $ | 199,052 | ||||||||||
Net income (loss) per share attributable to Deckers Outdoor Corporation common stockholders: | |||||||||||||||||||||||
Basic | $ | 3.76 | $ | 4.70 | $ | (0.08 | ) | $ | 4.23 | $ | 3.49 | $ | 5.16 | ||||||||||
Diluted | $ | 3.70 | $ | 4.66 | $ | (0.08 | ) | $ | 4.18 | $ | 3.45 | $ | 5.07 | ||||||||||
Weighted-average common shares outstanding: | |||||||||||||||||||||||
Basic | 32,556 | 34,433 | 34,621 | 34,473 | 36,879 | 38,605 | |||||||||||||||||
Diluted | 33,039 | 34,733 | 34,621 | 34,829 | 37,334 | 39,265 |
As of | |||||||||||||||||||||||
Years ended March 31, | Quarter ended (transition period) March 31, | Years ended December 31, | |||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||||
(In thousands) | |||||||||||||||||||||||
Balance Sheet Data | |||||||||||||||||||||||
Cash and cash equivalents | $ | 245,956 | $ | 225,143 | $ | 245,088 | $ | 237,125 | $ | 110,247 | $ | 263,606 | |||||||||||
Working capital | 547,267 | 519,051 | 501,647 | 508,786 | 424,569 | 585,823 | |||||||||||||||||
Total assets | 1,278,068 | 1,169,933 | 1,064,204 | 1,259,729 | 1,068,064 | 1,146,196 | |||||||||||||||||
Long-term liabilities | 72,099 | 65,379 | 53,140 | 51,092 | 62,246 | 72,687 | |||||||||||||||||
Total Deckers Outdoor Corporation stockholders' equity | 967,471 | 937,012 | 888,849 | 888,119 | 738,801 | 835,936 |
• | UGG®: Premier brand in luxurious comfort footwear, and expanding into handbags, apparel, home and cold weather accessories; |
• | Teva®: Born from the outdoors, active lifestyle footwear for the adventurous spirit; and |
• | Sanuk®: Authentic Southern California casual footwear for those seeking a playful escape. |
• | Sales of our products are highly seasonal and are sensitive to weather conditions, which are beyond our control. Even though we continue to expand our product lines and create more year-round styles for our brands, the effect of favorable or unfavorable weather on our aggregate sales has been, and is likely to continue to be, significant. We especially saw the impact of this trend during the third quarter when weather was unseasonably warm in many of our key markets. Weather will continue to be a significant factor impacting our business, and it will continue to be difficult for us to predict the impact that weather conditions in any future period will have on our financial condition and operating results. |
• | We believe there has been a meaningful shift in the way consumers shop for products and make purchasing decisions, and we expect these behaviors will continue to evolve. In particular, the retail industry appears to be experiencing a significant and prolonged decrease in consumer traffic. |
• | Fluctuations in currency exchange rates have significantly increased the value of the US dollar compared to most major foreign currencies over the past couple of years. We believe that this has been a significant factor contributing to a slowdown in traffic within our domestic retail locations, particularly within our flagship stores, which are located in major tourist cities. While we seek to hedge some of the risks associated with currency exchange rate fluctuations, these changes are largely outside |
• | The sheepskin used in certain UGG and Koolaburra products is in high demand and limited supply, and there have been significant fluctuations in the price of sheepskin in the past, as the demand for this material has fluctuated. While we continually strive to contain our material costs by entering into fixed price contracts, exploring new footwear materials and utilizing new production technologies, we expect that fluctuations in sheepskin prices will continue to materially impact our financial condition and operating results. In recent years, the impact of sheepskin price fluctuations on our operating results have been less dramatic, which we believe is partially a result of our introduction of UGGpure™, which is real wool material woven into a durable backing. |
• | Continuing uncertainty surrounding US and global economic conditions has adversely impacted businesses worldwide. Some of our customers have been, and more may be, adversely affected, which in turn has, and may continue to, adversely impact our financial results. |
• | We believe that consumers have narrowed their footwear product breadth, focusing on brands with a rich heritage and authenticity as market category creators and leaders. We also believe that consumers have become increasingly focused on luxury and comfort, seeking out products and brands that are fashionable while still comfortable. |
• | We believe that the growth and evolution of the DTC channel is a principal factor that has allowed us to evolve the lifestyle nature of our brands and to diversify our product lines. The DTC channel exposes individual consumers to the full line of our products, including non-core products such as casual boots and specialty classics. In addition, sales through the DTC channel are typically associated with higher gross margins, which have a favorable impact on our operating results. |
• | We have responded and intend to continue to respond to consumer focus on sustainability by establishing objectives, policies, and procedures to help us drive key sustainability initiatives around human rights, environmental conservation, and community affairs. |
• | High consumer brand loyalty, due to almost 40 years of delivering quality and luxuriously comfortable UGG footwear. |
• | Evolution of our Classics business through the evolution of features in our Classic boot and the introduction of innovative, Classics-inspired products such as the Classic Slim, the Classic Luxe, and the Classic Street, alongside targeted marketing campaigns. |
• | Continued growth and diversification of our UGG footwear product lines in non-core categories, including weather, casual boots, slippers, specialty classics, and transitional products that bridge the seasons, which has been driven by an important shift in the way we guide our wholesale customers in the pre-booking process. |
• | Exploration of opportunities in new product categories and styles beyond footwear, such as loungewear, handbags, cold-weather accessories and new home offerings. |
• | Continued growth of the DTC channel, which we believe will continue to allow us to diversify our UGG product lines, as the DTC channel exposes individual consumers to the full line of our products. |
• | Continued enhancement of our Omni-Channel capabilities to enable us to increasingly engage existing and prospective consumers in a more connected environment and expose them to the brand. In particular, we are working towards a more segmented channel and product approach to the market, whereby we can customize our product offerings based on unique consumer reach, market positioning and brand experience. |
• | Continued evolution of our men’s product lines, alongside targeted UGG for Men campaigns. |
• | “UGG Rewards”: We have implemented a consumer loyalty program under which points and awards are earned across the DTC channel. |
• | “Infinite UGG”: We provide online shopping access inside retail stores, for all SKUs available on our E-Commerce websites. |
• | “Buy online / return in-store”: Our consumers can buy online and return products to the store. |
• | “Click and collect”: Our consumers can buy online and have products delivered to certain of our retail stores for pick-up. |
• | “Retail inventory online”: Our consumers can view specific store location inventory online before visiting the store. |
• | We intend to launch certain products directly through the DTC segment, including certain Classics-inspired products, which we believe will drive growth within the segment. |
• | The evaluation of the growth of the DTC channel provides us with important data about product demand that we share with wholesale customers to help them make more informed ordering decisions. |
• | We expect operating profit to remain strong for the DTC channel, and for the DTC channel to serve as a key driver of our overall profitability. This is principally because the gross margins associated with sales made through our DTC channel are typically higher than those associated with sales made through our wholesale channel. |
• | We believe that our retail store fleet is an important component of our DTC segment. We have already penetrated the major metropolitan markets globally with our retail presence, and we intend to maintain our retail presence in these top markets and to continue further expansion in secondary markets, as appropriate. However, we are in the process of evaluating our portfolio of retail stores with the goal of optimizing our fleet, and have identified 24 retail stores that are candidates for closure. |
• | We continue to expect that our E-Commerce business will be a driver of growth, although we expect the growth rate will decline over time as the size of the E-Commerce business increases. |
• | We believe the results of the retail component of our DTC business have been negatively impacted by recent weather patterns, which differ from historical weather patterns. |
• | We believe the strengthening of the US dollar as compared to most major foreign currencies has reduced tourism traffic in our domestic retail stores, which has further negatively impacted the results of the retail component of our DTC business. |
Fiscal Year 2016 | |||||||||||||||
Quarter Ended 6/30/2015 | Quarter Ended 9/30/2015 | Quarter Ended 12/31/2015 | Quarter Ended 3/31/2016 | ||||||||||||
Net sales | $ | 213,805 | $ | 486,855 | $ | 795,902 | $ | 378,635 | |||||||
(Loss) income from operations | (63,708 | ) | 51,213 | 202,500 | (27,878 | ) |
Fiscal Year 2015 | |||||||||||||||
Quarter Ended 6/30/2014 | Quarter Ended 9/30/2014 | Quarter Ended 12/31/2014 | Quarter Ended 3/31/2015 | ||||||||||||
Net sales | $ | 211,469 | $ | 480,273 | $ | 784,678 | $ | 340,637 | |||||||
(Loss) income from operations | (50,482 | ) | 59,583 | 214,581 | 737 |
Years ended | ||||||||||||||||||||
3/31/2016 | 3/31/2015 | Change | ||||||||||||||||||
Amount | % | Amount | % | Amount | % | |||||||||||||||
Net sales | $ | 1,875,197 | 100.0 | % | $ | 1,817,057 | 100.0 | % | $ | 58,140 | 3.2 | % | ||||||||
Cost of sales | 1,028,529 | 54.8 | 938,949 | 51.7 | 89,580 | 9.5 | ||||||||||||||
Gross profit | 846,668 | 45.2 | 878,108 | 48.3 | (31,440 | ) | (3.6 | ) | ||||||||||||
Selling, general and administrative expenses | 684,541 | 36.5 | 653,689 | 36.0 | 30,852 | 4.7 | ||||||||||||||
Income from operations | 162,127 | 8.7 | 224,419 | 12.3 | (62,292 | ) | (27.8 | ) | ||||||||||||
Other expense, net | 5,242 | 0.3 | 3,280 | 0.2 | 1,962 | 59.8 | ||||||||||||||
Income before income taxes | 156,885 | 8.4 | 221,139 | 12.1 | (64,254 | ) | (29.1 | ) | ||||||||||||
Income tax expense | 34,620 | 1.9 | 59,359 | 3.2 | (24,739 | ) | (41.7 | ) | ||||||||||||
Net income | $ | 122,265 | 6.5 | % | $ | 161,780 | 8.9 | % | $ | (39,515 | ) | (24.4 | )% |
Years ended | ||||||||||||||
3/31/2016 | 3/31/2015 | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
Net sales by location: | ||||||||||||||
US | $ | 1,219,744 | $ | 1,165,350 | $ | 54,394 | 4.7 | % | ||||||
International | 655,453 | 651,707 | 3,746 | 0.6 | ||||||||||
Total | $ | 1,875,197 | $ | 1,817,057 | $ | 58,140 | 3.2 | % | ||||||
Net sales by brand and channel: | ||||||||||||||
UGG: | ||||||||||||||
Wholesale | $ | 918,102 | $ | 903,926 | $ | 14,176 | 1.6 | % | ||||||
Direct-to-Consumer | 606,247 | 589,267 | 16,980 | 2.9 | ||||||||||
Total | 1,524,349 | 1,493,193 | 31,156 | 2.1 | ||||||||||
Teva: | ||||||||||||||
Wholesale | 121,239 | 116,931 | 4,308 | 3.7 | ||||||||||
Direct-to-Consumer | 11,810 | 9,812 | 1,998 | 20.4 | ||||||||||
Total | 133,049 | 126,743 | 6,306 | 5.0 | ||||||||||
Sanuk: | ||||||||||||||
Wholesale | 90,719 | 102,690 | (11,971 | ) | (11.7 | ) | ||||||||
Direct-to-Consumer | 15,522 | 12,021 | 3,501 | 29.1 | ||||||||||
Total | 106,241 | 114,711 | (8,470 | ) | (7.4 | ) | ||||||||
Other brands: | ||||||||||||||
Wholesale | 100,820 | 76,152 | 24,668 | 32.4 | ||||||||||
Direct-to-Consumer | 10,738 | 6,258 | 4,480 | 71.6 | ||||||||||
Total | 111,558 | 82,410 | 29,148 | 35.4 | ||||||||||
Total | $ | 1,875,197 | $ | 1,817,057 | $ | 58,140 | 3.2 | % | ||||||
Total Wholesale | $ | 1,230,880 | $ | 1,199,699 | $ | 31,181 | 2.6 | % | ||||||
Total Direct-to-Consumer | 644,317 | 617,358 | 26,959 | 4.4 | ||||||||||
Total | $ | 1,875,197 | $ | 1,817,057 | $ | 58,140 | 3.2 | % |
• | increased salaries of approximately $19,000, largely attributable to transition and stabilization costs related to the move from Irvine to our new distribution center in Moreno Valley and a timing difference attributable to full operations commencing in the first quarter of fiscal year 2016 at Moreno Valley. Salaries were also impacted by $4,000 of severance related to restructuring expenses for our retail store fleet optimization and office consolidation and $4,000 for new retail stores opened subsequent to March 31, 2015; |
• | increased occupancy and rent expense of approximately $16,000, largely driven by the $9,000 restructuring charges for early termination of office and store leases related to our retail store fleet optimization and office consolidation and new retail stores opened subsequent to March 31, 2015; |
• | increased impairment charges for retail stores of approximately $9,800 for which the fair values did not exceed their carrying values based on our long-lived assets impairment analysis; |
• | increased expense of approximately $6,000 for store closure and lease termination costs related to our retail store fleet optimization and office consolidation; |
• | increased information technology costs of approximately $5,000, largely related to the restructuring charge of $4,000 for impairment of certain supply chain software related to the BT implementation and the reorganization of our supply chain team causing older software to be obsolete; |
• | increased depreciation expense of approximately $4,000 related to operations commencing at our new distribution center in Moreno Valley in the first quarter of fiscal year 2016; |
• | an increase in our accounts receivable allowances of approximately $4,000, reflecting our ongoing assessments of credit risks for several customers whose recent payment history and financial condition necessitated an increase in the allowance; |
• | decreased recognition of performance-based compensation of approximately $18,000 because the threshold level of the performance objectives relating to fiscal year 2016 was not achieved as compared to the partial achievement of performance objectives in the prior fiscal year; |
• | decreased expenses of approximately $12,000 related to the impact of foreign currency exchange rate fluctuations in the current period compared to the prior period; and |
• | decreased amortization expense of approximately $3,000, primarily attributable to the acquisition of our UGG brand distributor that had been selling to retailers in Germany in the prior year period that did not carry forward to the current period. |
Years ended | ||||||||||||||
3/31/2016 | 3/31/2015 | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
UGG wholesale | $ | 246,990 | $ | 269,489 | $ | (22,499 | ) | (8.3 | )% | |||||
Teva wholesale | 17,692 | 13,320 | 4,372 | 32.8 | ||||||||||
Sanuk wholesale | 15,565 | 21,914 | (6,349 | ) | (29.0 | ) | ||||||||
Other brands wholesale | (4,384 | ) | (9,838 | ) | 5,454 | 55.4 | ||||||||
Direct-to-Consumer | 101,756 | 150,320 | (48,564 | ) | (32.3 | ) | ||||||||
Unallocated overhead costs | (215,492 | ) | (220,786 | ) | 5,294 | 2.4 | ||||||||
Total | $ | 162,127 | $ | 224,419 | $ | (62,292 | ) | (27.8 | )% |
Years ended | |||||||
3/31/2016 | 3/31/2015 | ||||||
Income tax expense | $ | 34,620 | $ | 59,359 | |||
Effective income tax rate | 22.1 | % | 26.8 | % |
Years ended | ||||||||||||||||||||
3/31/2015 | 12/31/2013 | Change | ||||||||||||||||||
Amount | % | Amount | % | Amount | % | |||||||||||||||
Net sales | $ | 1,817,057 | 100.0 | % | $ | 1,556,618 | 100.0 | % | $ | 260,439 | 16.7 | % | ||||||||
Cost of sales | 938,949 | 51.7 | 820,135 | 52.7 | 118,814 | 14.5 | ||||||||||||||
Gross profit | 878,108 | 48.3 | 736,483 | 47.3 | 141,625 | 19.2 | ||||||||||||||
Selling, general and administrative expenses | 653,689 | 36.0 | 528,586 | 33.9 | 125,103 | 23.7 | ||||||||||||||
Income from operations | 224,419 | 12.3 | 207,897 | 13.4 | 16,522 | 7.9 | ||||||||||||||
Other expense, net | 3,280 | 0.2 | 2,340 | 0.2 | 940 | 40.2 | ||||||||||||||
Income before income taxes | 221,139 | 12.1 | 205,557 | 13.2 | 15,582 | 7.6 | ||||||||||||||
Income tax expense | 59,359 | 3.2 | 59,868 | 3.8 | (509 | ) | (0.9 | ) | ||||||||||||
Net income | $ | 161,780 | 8.9 | % | $ | 145,689 | 9.4 | % | $ | 16,091 | 11.0 | % |
Years ended | ||||||||||||||
3/31/2015 | 12/31/2013 | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
Net sales by location: | ||||||||||||||
US | $ | 1,165,350 | $ | 1,042,274 | $ | 123,076 | 11.8 | % | ||||||
International | 651,707 | 514,344 | 137,363 | 26.7 | ||||||||||
Total | $ | 1,817,057 | $ | 1,556,618 | $ | 260,439 | 16.7 | % | ||||||
Net sales by brand and channel: | ||||||||||||||
UGG: | ||||||||||||||
Wholesale | $ | 903,926 | $ | 818,377 | $ | 85,549 | 10.5 | % | ||||||
Direct-to-Consumer | 589,267 | 480,503 | 108,764 | 22.6 | ||||||||||
Total | 1,493,193 | 1,298,880 | 194,313 | 15.0 | ||||||||||
Teva: | ||||||||||||||
Wholesale | 116,931 | 109,334 | 7,597 | 6.9 | ||||||||||
Direct-to-Consumer | 9,812 | 7,053 | 2,759 | 39.1 | ||||||||||
Total | 126,743 | 116,387 | 10,356 | 8.9 | ||||||||||
Sanuk: | ||||||||||||||
Wholesale | 102,690 | 94,420 | 8,270 | 8.8 | ||||||||||
Direct-to-Consumer | 12,021 | 7,260 | 4,761 | 65.6 | ||||||||||
Total | 114,711 | 101,680 | 13,031 | 12.8 | ||||||||||
Other brands: | ||||||||||||||
Wholesale | 76,152 | 38,276 | 37,876 | 99.0 | ||||||||||
Direct-to-Consumer | 6,258 | 1,395 | 4,863 | 348.6 | ||||||||||
Total | 82,410 | 39,671 | 42,739 | 107.7 | ||||||||||
Total | $ | 1,817,057 | $ | 1,556,618 | $ | 260,439 | 16.7 | % | ||||||
Total Wholesale | $ | 1,199,699 | $ | 1,060,407 | $ | 139,292 | 13.1 | % | ||||||
Total Direct-to-Consumer | 617,358 | 496,211 | 121,147 | 24.4 | ||||||||||
Total | $ | 1,817,057 | $ | 1,556,618 | $ | 260,439 | 16.7 | % |
• | increased DTC costs of approximately $62,000 largely related to new retail stores opened subsequent to December 31, 2013 of approximately $44,000 and related corporate infrastructure for our retail business and increased marketing and advertising and expansion for our E-Commerce business of approximately $18,000; |
• | increased expenses of approximately $20,000 for marketing and promotions related to our wholesale business, primarily for the Hoka and UGG brands; |
• | increased expenses of approximately $16,000 for corporate infrastructure to support our international wholesale expansion and OmniChannel transformation; |
• | increased information technology costs of approximately $8,000, in part due to accelerating the amortization expense for certain software projects that will not be used; |
• | increased sales and commission expenses of approximately $8,000 largely driven by the increase in wholesale sales; |
• | increased US distribution center costs of approximately $7,000, largely driven by the increase in sales and our new Moreno Valley distribution center; and |
• | increased expenses of approximately $7,000 related to the negative impact of foreign currency exchange rate fluctuations. |
Years ended | ||||||||||||||
3/31/2015 | 12/31/2013 | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
UGG wholesale | $ | 269,489 | $ | 224,738 | $ | 44,751 | 19.9 | % | ||||||
Teva wholesale | 13,320 | 9,166 | 4,154 | 45.3 | ||||||||||
Sanuk wholesale | 21,914 | 20,591 | 1,323 | 6.4 | ||||||||||
Other brands wholesale | (9,838 | ) | (9,807 | ) | (31 | ) | (0.3 | ) | ||||||
Direct-to-Consumer | 150,320 | 132,532 | 17,788 | 13.4 | ||||||||||
Unallocated overhead costs | (220,786 | ) | (169,323 | ) | (51,463 | ) | (30.4 | ) | ||||||
Total | $ | 224,419 | $ | 207,897 | $ | 16,522 | 7.9 | % |
Years ended | |||||||
3/31/2015 | 12/31/2013 | ||||||
Income tax expense | $ | 59,359 | $ | 59,868 | |||
Effective income tax rate | 26.8 | % | 29.1 | % |
Three Months Ended March 31, | ||||||||||||||||||||
2014 | 2013 (unaudited) | Change | ||||||||||||||||||
Amount | % | Amount | % | Amount | % | |||||||||||||||
Net sales | $ | 294,716 | 100.0 | % | $ | 263,760 | 100.0 | % | $ | 30,956 | 11.7 | % | ||||||||
Cost of sales | 150,456 | 51.1 | 140,201 | 53.2 | 10,255 | 7.3 | ||||||||||||||
Gross profit | 144,260 | 48.9 | 123,559 | 46.8 | 20,701 | 16.8 | ||||||||||||||
Selling, general and administrative expenses | 144,668 | 49.1 | 120,907 | 45.8 | 23,761 | 19.7 | ||||||||||||||
(Loss) income from operations | (408 | ) | (0.2 | ) | 2,652 | 1.0 | (3,060 | ) | (115.4 | ) | ||||||||||
Other expense, net | 334 | 0.1 | 142 | 0.1 | 192 | 135.2 | ||||||||||||||
(Loss) income before income taxes | (742 | ) | (0.3 | ) | 2,510 | 0.9 | (3,252 | ) | (129.6 | ) | ||||||||||
Income tax expense | 1,943 | 0.6 | 1,503 | 0.5 | 440 | 29.3 | ||||||||||||||
Net (loss) income | $ | (2,685 | ) | (0.9 | )% | $ | 1,007 | 0.4 | % | $ | (3,692 | ) | (366.6 | )% |
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 (unaudited) | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
Net sales by location: | ||||||||||||||
US | $ | 198,293 | $ | 182,693 | $ | 15,600 | 8.5 | % | ||||||
International | 96,423 | 81,067 | 15,356 | 18.9 | ||||||||||
Total | $ | 294,716 | $ | 263,760 | $ | 30,956 | 11.7 | % | ||||||
Net sales by brand and channel: | ||||||||||||||
UGG: | ||||||||||||||
Wholesale | $ | 83,271 | $ | 82,706 | $ | 565 | 0.7 | % | ||||||
Direct-to-Consumer | 114,309 | 87,875 | 26,434 | 30.1 | ||||||||||
Total | 197,580 | 170,581 | 26,999 | 15.8 | ||||||||||
Teva: | ||||||||||||||
Wholesale | 45,283 | 50,504 | (5,221 | ) | (10.3 | ) | ||||||||
Direct-to-Consumer | 1,564 | 1,103 | 461 | 41.8 | ||||||||||
Total | 46,847 | 51,607 | (4,760 | ) | (9.2 | ) | ||||||||
Sanuk: | ||||||||||||||
Wholesale | 28,793 | 30,011 | (1,218 | ) | (4.1 | ) | ||||||||
Direct-to-Consumer | 1,909 | 935 | 974 | 104.2 | ||||||||||
Total | 30,702 | 30,946 | (244 | ) | (0.8 | ) | ||||||||
Other brands: | ||||||||||||||
Wholesale | 18,662 | 10,369 | 8,293 | 80.0 | ||||||||||
Direct-to-Consumer | 925 | 257 | 668 | 259.9 | ||||||||||
Total | 19,587 | 10,626 | 8,961 | 84.3 | ||||||||||
Total | $ | 294,716 | $ | 263,760 | $ | 30,956 | 11.7 | % | ||||||
Total Wholesale | $ | 176,009 | $ | 173,590 | $ | 2,419 | 1.4 | % | ||||||
Total Direct-to-Consumer | 118,707 | 90,170 | 28,537 | 31.6 | ||||||||||
Total | $ | 294,716 | $ | 263,760 | $ | 30,956 | 11.7 | % |
• | increased DTC costs of approximately $19,000 largely related to new retail stores opened subsequent to December 31, 2013 and related corporate infrastructure for our retail business and increased marketing and advertising, the negative impact of foreign currency exchange rate fluctuations, and increased expenses related to the international expansion for our E-Commerce business; and |
• | increased expenses of approximately $3,000 for marketing and promotions, largely related to the UGG and Hoka brands. |
Three Months Ended March 31, | ||||||||||||||
2014 | 2013 (unaudited) | Change | ||||||||||||
Amount | Amount | Amount | % | |||||||||||
UGG wholesale | $ | 13,595 | $ | 14,081 | $ | (486 | ) | (3.5 | )% | |||||
Teva wholesale | 6,425 | 9,640 | (3,215 | ) | (33.4 | ) | ||||||||
Sanuk wholesale | 7,530 | 9,360 | (1,830 | ) | (19.6 | ) | ||||||||
Other brands wholesale | (758 | ) | (2,580 | ) | 1,822 | 70.6 | ||||||||
Direct-to-Consumer | 20,918 | 19,402 | 1,516 | 7.8 | ||||||||||
Unallocated overhead costs | (48,118 | ) | (47,251 | ) | (867 | ) | (1.8 | ) | ||||||
Total | $ | (408 | ) | $ | 2,652 | $ | (3,060 | ) | (115.4 | )% |
Three Months Ended March 31, | |||||||
2014 | 2013 (unaudited) | ||||||
Income tax expense | $ | 1,943 | $ | 1,503 | |||
Effective income tax rate | (261.9 | )% | 59.9 | % |
Years ended | |||||||||||
3/31/2016 | 3/31/2015 | 12/31/2013 | |||||||||
Net cash provided by operating activities | $ | 125,581 | $ | 169,654 | $ | 262,125 | |||||
Net cash used in investing activities | (67,221 | ) | (100,636 | ) | (85,197 | ) | |||||
Net cash used in financing activities | (36,340 | ) | (78,260 | ) | (50,513 | ) |
Payments Due by Period | |||||||||||||||||||
Total | Less than 1 Year | 1-3 Years | 3-5 Years | More than 5 Years | |||||||||||||||
Operating lease obligations (1) | $ | 315,440 | $ | 50,763 | $ | 94,297 | $ | 66,052 | $ | 104,328 | |||||||||
Purchase obligations (2) | 990,922 | 915,465 | 67,707 | 7,750 | — | ||||||||||||||
Mortgage obligation (3) | 52,519 | 2,168 | 4,336 | 4,336 | 41,679 | ||||||||||||||
Contingent consideration obligations (4) | 20,018 | 20,018 | — | — | — | ||||||||||||||
Unrecognized tax benefits (5) | 7,236 | 856 | 2,459 | 3,921 | — | ||||||||||||||
Total | $ | 1,386,135 | $ | 989,270 | $ | 168,799 | $ | 82,059 | $ | 146,007 |
(1) | Our operating lease obligations consist primarily of building leases for our retail locations, distribution centers, and regional offices, and include the cash lease payments of deferred rents. |
(2) | Our purchase obligations consist mostly of open purchase orders. They also consist of capital expenditures, service contracts and promotional expenses. Outstanding purchase orders are primarily with our third-party manufacturers and most are expected to be paid within one year. These are outstanding open orders and not minimum purchase obligations. Our promotional expenditures and service contracts are due periodically during fiscal years 2017 through 2021. |
(3) | Our mortgage obligation consists of a mortgage secured by our corporate headquarters property. The mortgage has a fixed interest rate of 4.928%. Payments include interest and principal in an amount that amortizes the principal balance over a 30-year period; however, the loan will mature and have a balloon payment due on July 1, 2029 of approximately $23,400. Refer to Note 6 to our accompanying consolidated financial statements in Part IV of this Annual Report on Form 10-K. |
(4) | Our contingent consideration obligations consist of final contingent consideration payments for the acquisitions of the Sanuk and Hoka brands. For additional information, refer to the "Commitments and Contingencies" section below and Notes 1 and 7 to our accompanying consolidated financial statements in Part IV of this Annual Report on Form 10-K. |
(5) | The unrecognized tax benefits are related to uncertain tax positions taken in our income tax return that would impact the effective tax rate, if recognized. Refer to Note 5 to our accompanying consolidated financial statements in Part IV of this Annual Report on Form 10-K. |
March 31, 2016 | March 31, 2015 | ||||||||||||
Amount | % of Gross Trade Accounts Receivable | Amount | % of Gross Trade Accounts Receivable | ||||||||||
Gross trade accounts receivable | $ | 190,349 | $ | 161,323 | |||||||||
Allowance for doubtful accounts | 5,494 | 2.9 | % | 2,297 | 1.4 | % | |||||||
Allowance for sales discounts | 2,672 | 1.4 | 2,348 | 1.5 | |||||||||
Allowance for estimated chargebacks | 4,968 | 2.6 | 4,041 | 2.5 |
Amount | % of Net Sales | Amount | % of Net Sales | ||||||||||
Net sales for the three months ended | $ | 378,635 | $ | 340,637 | |||||||||
Allowance for estimated returns | 17,061 | 4.5 | % | 9,532 | 2.8 | % | |||||||
Estimated returns liability | 1,889 | 0.5 | 1,741 | 0.5 |
Exhibit Number | Description of Exhibit | |
3.1 | Amended and Restated Certificate of Incorporation of Deckers Outdoor Corporation, as amended through May 27, 2010 (Exhibit 3.1 to the Registrant's Form 10-Q filed on August 8, 2011 and incorporated by reference herein) | |
3.2 | Amended and Restated Bylaws of Deckers Outdoor Corporation, as amended through September 10, 2015 (Exhibit 3.1 to the Registrant’s Form 8-K filed on September 16, 2015 and incorporated by reference herein) | |
10.2 | Lease Agreement, dated September 15, 2004, by and between Mission Oaks Associates, LLC and Deckers Outdoor Corporation for distribution center at 3001 Mission Oaks Blvd., Camarillo, CA 93012 (Exhibit 10.37 to the Registrant's Form 10-K filed on March 16, 2005 and incorporated by reference herein) | |
10.3 | First Amendment to Lease Agreement, dated December 1, 2004, by and between Mission Oaks Associates, LLC and Deckers Outdoor Corporation for distribution center at 3001 Mission Oaks Blvd., Camarillo, CA 93012 (Exhibit 10.38 to the Registrant's Form 10-K filed on March 16, 2005 and incorporated by reference herein) | |
10.4 | Amendment to Lease Agreement, dated September 1, 2011, by and between Mission Oaks Associates, LLC and Deckers Outdoor Corporation for distribution center at 3001 Mission Oaks Blvd., Camarillo, CA 93012 (Exhibit 10.23 to the Registrant's Form 10-K filed on February 29, 2012 and incorporated by reference herein) | |
10.5 | Amendment to Lease Agreement, dated September 1, 2011, by and between 450 N. Baldwin Park Associates, LLC and Deckers Outdoor Corporation for distribution center at 3175 Mission Oaks Blvd., Camarillo, CA 93012 (Exhibit 10.24 to the Registrant's Form 10-K filed on February 29, 2012 and incorporated by reference herein) | |
10.6 | Lease Agreement, dated December 5, 2013, by and between Moreno Knox, LLC and Deckers Outdoor Corporation for distribution center at 17791 Perris Blvd., Moreno Valley, CA 92551 (Exhibit 10.6 to the Registrant’s Form 10-K filed on March 3, 2014 and incorporated by reference herein) | |
#10.7 | Deckers Outdoor Corporation 2006 Equity Incentive Plan (Appendix A to the Registrant's Definitive Proxy Statement filed on April 21, 2006 and incorporated by reference herein) | |
#10.8 | First Amendment to Deckers Outdoor Corporation 2006 Equity Incentive Plan (Appendix A to the Registrant's Definitive Proxy Statement filed on April 9, 2007 and incorporated by reference herein) | |
#10.9 | Deckers Outdoor Corporation Amended and Restated Deferred Stock Unit Compensation Plan, a Sub Plan under the 2006 Equity Incentive Plan, adopted by the Board of Directors on December 14, 2010 (Exhibit 10.24 to the Registrant's Form 10-K filed on March 1, 2011 and incorporated by reference herein) | |
#10.10 | Deckers Outdoor Corporation Amended and Restated Deferred Compensation Plan, effective August 1, 2013 (Exhibit 10.10 to the Registrant’s Form 10-K filed on March 3, 2014 and incorporated by reference herein) | |
#10.11 | Form of Deckers Outdoor Corporation Management Incentive Program under the 2006 Equity Incentive Plan (Exhibit 10.28 to the Registrant’s Form 10-K filed on March 1, 2013 and incorporated by reference herein) |
Exhibit Number | Description of Exhibit | |
#10.12 | Form of Restricted Stock Unit Award Agreement (Level 2) under the 2006 Equity Incentive Plan (Exhibit 10.3 to the Registrant's Form 8-K filed on May 11, 2007 and incorporated by reference herein) | |
#10.13 | Form of Restricted Stock Unit Award Agreement (Level III) under the 2006 Equity Incentive Plan (Exhibit 10.1 to the Registrant's Form 8-K filed on June 28, 2011 and incorporated by reference herein) | |
#10.14 | Form of Stock Appreciation Rights Award Agreement (Level 2) under the 2006 Equity Incentive Plan (Exhibit 10.5 to the Registrant's Form 8-K filed on May 11, 2007 and incorporated by reference herein) | |
#10.15 | Form of Restricted Stock Unit Award Agreement (2012 LTIP) under the 2006 Equity Incentive Plan (Exhibit 10.1 to the Registrant's Form 8-K filed on May 31, 2012 and incorporated by reference herein) | |
#10.16 | Form of Restricted Stock Unit Award Agreement (2013 LTIP) under the 2006 Equity Incentive Plan (Exhibit 10.1 to the Registrant's Form 8-K filed on December 19, 2013 and incorporated by reference herein) | |
#10.17 | Form of Restricted Stock Unit Award Agreement (2014 LTIP) under the 2006 Equity Incentive Plan (Exhibit 10.1 to the Registrant's Form 8-K filed on September 24, 2014 and incorporated by reference herein) | |
#10.18 | Form of Stock Unit Award Agreement under the 2006 Equity Incentive Plan (Exhibit 10.27 to the Registrant’s Form 10-K filed on March 1, 2013 and incorporated by reference herein) | |
#10.19 | Form of Stock Unit Award Agreement under the 2006 Equity Incentive Plan (Exhibit 10.28 to the Registrant’s Form 10-K filed on March 3, 2014 and incorporated by reference herein) | |
#10.20 | Change of Control and Severance Agreement, dated December 22, 2009, by and between Angel Martinez and Deckers Outdoor Corporation (Exhibit 10.33 to the Registrant's Form 10-K filed on March 1, 2010 and incorporated by reference herein) | |
#10.21 | Change of Control and Severance Agreement, dated December 22, 2009, by and between Thomas George and Deckers Outdoor Corporation (Exhibit 10.35 to the Registrant's Form 10-K filed on March 1, 2010 and incorporated by reference herein) | |
#10.22 | Change of Control and Severance Agreement, dated December 22, 2009, by and between Constance Rishwain and Deckers Outdoor Corporation (Exhibit 10.36 to the Registrant's Form 10-K filed on March 1, 2010 and incorporated by reference herein) | |
#10.23 | Consulting Agreement and General Release, dated January 16, 2015, by and between Zohar Ziv and Deckers Outdoor Corporation (Exhibit 10.1 to the Registrant’s Form 8-K filed on January 21, 2015 and incorporated by reference herein) | |
#10.24 | Consulting Agreement and General Release, dated May 6, 2015, by and between Constance Rishwain and Deckers Outdoor Corporation (Exhibit 10.1 to the Registrant’s Form 8-K filed on May 12, 2015 and incorporated by reference herein) | |
#10.25 | Employment Agreement, dated February 28, 2011, by and between Stephen Murray and Deckers Europe Limited (Exhibit 10.23 to the Registrant’s Form 10-K filed on March 3, 2014 and incorporated by reference herein) | |
10.26 | Second Amended and Restated Credit Agreement, dated November 13, 2014, by and among Deckers Outdoor Corporation, as Borrower, JPMorgan Chase Bank, National Association, as Administrative Agent, Comerica Bank and HSBC Bank USA, National Association, as Co-Syndication Agents, and the lenders from time to time party thereto (Exhibit 10.1 to the Registrant’s Form 8-K filed on November 19, 2014 and incorporated by reference herein) | |
10.27 | Term Loan Agreement, dated July 9, 2014, by and among Deckers Cabrillo, LLC, as Borrower and California Bank & Trust, as Lender (Exhibit 10.1 to the Registrant’s Form 8-K filed on July 15, 2014 and incorporated by reference herein) | |
10.28 | Continuing Guaranty Agreement, dated July 9, 2014, by and among Deckers Outdoor Corporation and California Bank & Trust (Exhibit 10.2 to the Registrant’s Form 8-K filed on July 15, 2014 and incorporated by reference herein) | |
10.29 | Deed of Trust, Assignment of Leases and Rents and Security Agreement (including Fixture Filing), dated July 9, 2014, executed by Deckers Cabrillo, LLC (Exhibit 10.3 to the Registrant’s Form 8-K filed on July 15, 2014 and incorporated by reference herein) |
Exhibit Number | Description of Exhibit | |
#10.30 | Deckers Outdoor Corporation 2015 Employee Stock Purchase Plan (Appendix A to the Registrant's Definitive Proxy Statement filed on July 29, 2015 and incorporated by reference herein) | |
#10.31 | Deckers Outdoor Corporation 2015 Stock Incentive Plan (Appendix B to the Registrant's Definitive Proxy Statement filed on July 29, 2015 and incorporated by reference herein) | |
#10.32 | Management Incentive Plan (Exhibit 10.1 to the Registrant's Form 10-Q filed on August 10, 2015 and incorporated by reference herein) | |
#10.33 | 2016 Non-Vested Stock Unit (NSU) Award Agreement (Exhibit 10.2 to the Registrant's Form 10-Q filed on August 10, 2015 and incorporated by reference herein) | |
#10.34 | Form of Restricted Stock Unit Award Agreement under 2015 Stock Incentive Plan (2016 LTIP Financial Performance Award) (Exhibit 10.1 to the Registrant’s Form 8-K filed on November 24, 2015 and incorporated by reference herein) | |
*21.1 | Subsidiaries of Registrant | |
*23.1 | Consent of Independent Registered Public Accounting Firm | |
*31.1 | Certification of the Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
*31.2 | Certification of the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
**32 | Certification Pursuant to 18 U.S.C. Section 1350 Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
*101.1 | The following materials from the Company's Annual Report on Form 10-K for the annual period ended March 31, 2016, formatted in XBRL (eXtensible Business Reporting Language); (i) Consolidated Balance Sheets at March 31, 2016 and March 31, 2015; (ii) Consolidated Statements of Comprehensive Income (Loss) for the years ended March 31, 2016 and March 31, 2015, quarter transition period ended March 31, 2014, and year ended December 31, 2013; (iii) Consolidated Statements of Cash Flows for the years ended March 31, 2016 and March 31, 2015, quarter transition period ended March 31, 2014, and year ended December 31, 2013, and (iv) Notes to Consolidated Financial Statements. |
DECKERS OUTDOOR CORPORATION (Registrant) |
/s/ ANGEL R. MARTINEZ |
Angel R. Martinez Chairman and Chief Executive Officer |
/s/ ANGEL R. MARTINEZ | Chairman of the Board, Chief Executive Officer (Principal Executive Officer) | May 31, 2016 |
Angel R. Martinez | ||
/s/ THOMAS A. GEORGE | Chief Financial Officer (Principal Financial and Accounting Officer) | May 31, 2016 |
Thomas A. George | ||
/s/ MICHAEL F. DEVINE, III | Director | May 31, 2016 |
Michael F. Devine, III | ||
/s/ KARYN O. BARSA | Director | May 31, 2016 |
Karyn O. Barsa | ||
/s/ JOHN M. GIBBONS | Director | May 31, 2016 |
John M. Gibbons | ||
/s/ JOHN G. PERENCHIO | Director | May 31, 2016 |
John G. Perenchio | ||
/s/ LAURI SHANAHAN | Director | May 31, 2016 |
Lauri Shanahan | ||
/s/ JAMES QUINN | Director | May 31, 2016 |
James Quinn | ||
/s/ BONITA C. STEWART | Director | May 31, 2016 |
Bonita C. Stewart | ||
/s/ NELSON C. CHAN | Director | May 31, 2016 |
Nelson C. Chan |
Page | |
Consolidated Financial Statements: | |
Reports of Independent Registered Public Accounting Firm | |
Consolidated Balance Sheets at March 31, 2016 and March 31, 2015 | |
Consolidated Statements of Comprehensive Income (Loss) for the years ended March 31, 2016 and March 31, 2015, quarter ended (transition period) March 31, 2014, and year ended December 31, 2013 | |
Consolidated Statements of Stockholders' Equity for the years ended March 31, 2016 and March 31, 2015, quarter ended (transition period) March 31, 2014, and year ended December 31, 2013 | |
Consolidated Statements of Cash Flows for the years ended March 31, 2016 and March 31, 2015, quarter ended (transition period) March 31, 2014, and year ended December 31, 2013 | |
Notes to Consolidated Financial Statements | |
Consolidated Financial Statement Schedule: | |
Schedule II - Valuation and Qualifying Accounts for the years ended March 31, 2016 and March 31, 2015, quarter ended (transition period) March 31, 2014, and year ended December 31, 2013 |
March 31, | |||||||
2016 | 2015 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 245,956 | $ | 225,143 | |||
Trade accounts receivable, net of allowances ($30,195 at March 31, 2016 and $18,218 at March 31, 2015) | 160,154 | 143,105 | |||||
Inventories | 299,911 | 238,911 | |||||
Prepaid expenses | 18,249 | 15,141 | |||||
Other current assets | 38,039 | 35,057 | |||||
Income tax receivable | 23,456 | 15,170 | |||||
Deferred tax assets | — | 14,066 | |||||
Total current assets | 785,765 | 686,593 | |||||
Property and equipment, net of accumulated depreciation ($163,807 at March 31, 2016 and $129,002 at March 31, 2015) | 237,246 | 232,317 | |||||
Goodwill | 127,934 | 127,934 | |||||
Other intangible assets, net of accumulated amortization ($45,302 at March 31, 2016 and $37,316 at March 31, 2015) | 83,026 | 87,743 | |||||
Deferred tax assets | 20,636 | 15,017 | |||||
Other assets | 23,461 | 20,329 | |||||
Total assets | $ | 1,278,068 | $ | 1,169,933 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Short-term borrowings | $ | 67,475 | $ | 5,383 | |||
Trade accounts payable | 100,593 | 85,714 | |||||
Accrued payroll | 20,625 | 27,300 | |||||
Other accrued expenses | 39,449 | 41,066 | |||||
Income taxes payable | 6,461 | 6,858 | |||||
Value added tax payable | 3,895 | 1,221 | |||||
Total current liabilities | 238,498 | 167,542 | |||||
Long-term liabilities: | |||||||
Mortgage payable | 32,631 | 33,154 | |||||
Income tax liability | 9,073 | 5,087 | |||||
Deferred rent obligations | 16,139 | 15,663 | |||||
Other long-term liabilities | 14,256 | 11,475 | |||||
Total long-term liabilities | 72,099 | 65,379 | |||||
Commitments and contingencies (Note 7) | |||||||
Stockholders' equity: | |||||||
Common stock ($0.01 par value; 125,000 shares authorized; shares issued and outstanding of 32,020 at March 31, 2016 and 33,292 at March 31, 2015) | 320 | 333 | |||||
Additional paid-in capital | 161,259 | 158,777 | |||||
Retained earnings | 826,449 | 798,370 | |||||
Accumulated other comprehensive loss | (20,557 | ) | (20,468 | ) | |||
Total stockholders' equity | 967,471 | 937,012 | |||||
Total liabilities and stockholders' equity | $ | 1,278,068 | $ | 1,169,933 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Net sales | $ | 1,875,197 | $ | 1,817,057 | $ | 294,716 | $ | 1,556,618 | |||||||
Cost of sales | 1,028,529 | 938,949 | 150,456 | 820,135 | |||||||||||
Gross profit | 846,668 | 878,108 | 144,260 | 736,483 | |||||||||||
Selling, general and administrative expenses | 684,541 | 653,689 | 144,668 | 528,586 | |||||||||||
Income (loss) from operations | 162,127 | 224,419 | (408 | ) | 207,897 | ||||||||||
Other expense (income), net: | |||||||||||||||
Interest income | (420 | ) | (207 | ) | (65 | ) | (60 | ) | |||||||
Interest expense | 5,814 | 4,220 | 516 | 3,079 | |||||||||||
Other, net | (152 | ) | (733 | ) | (117 | ) | (679 | ) | |||||||
Total other expense, net | 5,242 | 3,280 | 334 | 2,340 | |||||||||||
Income (loss) before income taxes | 156,885 | 221,139 | (742 | ) | 205,557 | ||||||||||
Income tax expense | 34,620 | 59,359 | 1,943 | 59,868 | |||||||||||
Net income (loss) | 122,265 | 161,780 | (2,685 | ) | 145,689 | ||||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||
Unrealized gain (loss) on foreign currency hedging | 461 | 450 | (273 | ) | (486 | ) | |||||||||
Foreign currency translation adjustment | (550 | ) | (18,875 | ) | 873 | (757 | ) | ||||||||
Total other comprehensive (loss) income | (89 | ) | (18,425 | ) | 600 | (1,243 | ) | ||||||||
Comprehensive income (loss) | $ | 122,176 | $ | 143,355 | $ | (2,085 | ) | $ | 144,446 | ||||||
Net income (loss) per share: | |||||||||||||||
Basic | $ | 3.76 | $ | 4.70 | $ | (0.08 | ) | $ | 4.23 | ||||||
Diluted | $ | 3.70 | $ | 4.66 | $ | (0.08 | ) | $ | 4.18 | ||||||
Weighted-average common shares outstanding: | |||||||||||||||
Basic | 32,556 | 34,433 | 34,621 | 34,473 | |||||||||||
Diluted | 33,039 | 34,733 | 34,621 | 34,829 |
Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | ||||||||||||||||||
Shares | Amount | |||||||||||||||||||||
Balance, December 31, 2012 | 34,400 | $ | 344 | $ | 139,046 | $ | 600,811 | $ | (1,400 | ) | $ | 738,801 | ||||||||||
Stock compensation expense | 15 | — | 13,136 | — | — | 13,136 | ||||||||||||||||
Exercise of stock options | 8 | — | 52 | — | — | 52 | ||||||||||||||||
Shares issued upon vesting | 195 | 2 | (2 | ) | — | — | — | |||||||||||||||
Excess tax benefit from stock compensation | — | — | 319 | — | — | 319 | ||||||||||||||||
Shares withheld for taxes | — | — | (8,635 | ) | — | — | (8,635 | ) | ||||||||||||||
Net income | — | — | — | 145,689 | — | 145,689 | ||||||||||||||||
Total other comprehensive loss | — | — | — | — | (1,243 | ) | (1,243 | ) | ||||||||||||||
Balance, December 31, 2013 | 34,618 | 346 | 143,916 | 746,500 | (2,643 | ) | 888,119 | |||||||||||||||
Stock compensation expense | 5 | — | 2,865 | — | — | 2,865 | ||||||||||||||||
Shares issued upon vesting | 1 | — | — | — | — | — | ||||||||||||||||
Shares withheld for taxes | — | — | (50 | ) | — | — | (50 | ) | ||||||||||||||
Net loss | — | — | — | (2,685 | ) | — | (2,685 | ) | ||||||||||||||
Total other comprehensive income | — | — | — | — | 600 | 600 | ||||||||||||||||
Balance, March 31, 2014 | 34,624 | 346 | 146,731 | 743,815 | (2,043 | ) | 888,849 | |||||||||||||||
Stock compensation expense | 11 | — | 13,524 | — | — | 13,524 | ||||||||||||||||
Shares issued upon vesting | 93 | 1 | (1 | ) | — | — | — | |||||||||||||||
Excess tax benefit from stock compensation | — | — | 4,197 | — | — | 4,197 | ||||||||||||||||
Shares withheld for taxes | — | — | (5,674 | ) | — | — | (5,674 | ) | ||||||||||||||
Stock repurchase | (1,436 | ) | (14 | ) | — | (107,225 | ) | — | (107,239 | ) | ||||||||||||
Net income | — | — | — | 161,780 | — | 161,780 | ||||||||||||||||
Total other comprehensive loss | — | — | — | — | (18,425 | ) | (18,425 | ) | ||||||||||||||
Balance, March 31, 2015 | 33,292 | 333 | 158,777 | 798,370 | (20,468 | ) | 937,012 | |||||||||||||||
Stock compensation expense | 16 | — | 6,622 | — | — | 6,622 | ||||||||||||||||
Shares issued upon vesting | 132 | 1 | (1 | ) | — | — | — | |||||||||||||||
Excess tax benefit from stock compensation | — | — | 471 | — | — | 471 | ||||||||||||||||
Shares withheld for taxes | — | — | (4,610 | ) | — | — | (4,610 | ) | ||||||||||||||
Stock repurchase | (1,420 | ) | (14 | ) | — | (94,186 | ) | — | (94,200 | ) | ||||||||||||
Net income | — | — | — | 122,265 | — | 122,265 | ||||||||||||||||
Total other comprehensive loss | — | — | — | — | (89 | ) | (89 | ) | ||||||||||||||
Balance, March 31, 2016 | 32,020 | $ | 320 | $ | 161,259 | $ | 826,449 | $ | (20,557 | ) | $ | 967,471 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net income (loss) | $ | 122,265 | $ | 161,780 | $ | (2,685 | ) | $ | 145,689 | ||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||||
Depreciation, amortization and accretion | 50,024 | 49,293 | 10,569 | 41,439 | |||||||||||
Change in fair value of contingent consideration | (4,411 | ) | (3,574 | ) | 705 | 1,815 | |||||||||
Provision for (recovery of) doubtful accounts, net | 5,120 | 1,107 | (169 | ) | 125 | ||||||||||
Deferred tax provision | 8,167 | 9,970 | (2,736 | ) | (4,092 | ) | |||||||||
Stock compensation | 6,622 | 13,524 | 2,865 | 13,136 | |||||||||||
Gain on sale of assets | (1,338 | ) | — | — | — | ||||||||||
Impairment of long-lived assets | 9,773 | — | — | — | |||||||||||
Restructuring costs | 24,856 | — | — | — | |||||||||||
Other | 56 | 2,969 | 111 | 1,306 | |||||||||||
Changes in operating assets and liabilities: | |||||||||||||||
Trade accounts receivable | (23,545 | ) | (36,885 | ) | 77,983 | 6,618 | |||||||||
Inventories | (61,492 | ) | (26,748 | ) | 49,272 | 40,580 | |||||||||
Prepaid expenses and other current assets | (3,681 | ) | (10,376 | ) | 68,837 | (58,554 | ) | ||||||||
Income tax receivable | (8,286 | ) | (15,170 | ) | — | — | |||||||||
Other assets | (3,082 | ) | (144 | ) | (758 | ) | (4,290 | ) | |||||||
Trade accounts payable | 14,775 | 8,912 | (74,898 | ) | 21,251 | ||||||||||
Contingent consideration | (819 | ) | (364 | ) | (2,974 | ) | (6,458 | ) | |||||||
Accrued expenses | (16,221 | ) | 3,761 | (33,666 | ) | 33,556 | |||||||||
Income taxes payable | (397 | ) | 4,883 | (46,545 | ) | 24,386 | |||||||||
Long-term liabilities | 7,195 | 6,716 | 1,998 | 5,618 | |||||||||||
Net cash provided by operating activities | 125,581 | 169,654 | 47,909 | 262,125 | |||||||||||
Cash flows from investing activities: | |||||||||||||||
Purchases of property and equipment | (65,356 | ) | (91,147 | ) | (17,603 | ) | (79,829 | ) | |||||||
Purchases of tangible, intangible, and other assets, net | (4,700 | ) | (9,489 | ) | (30 | ) | (5,368 | ) | |||||||
Proceeds from sale of assets | 2,835 | — | — | — | |||||||||||
Net cash used in investing activities | (67,221 | ) | (100,636 | ) | (17,633 | ) | (85,197 | ) | |||||||
Cash flows from financing activities: | |||||||||||||||
Proceeds from issuance of short-term borrowings | 449,200 | 199,784 | — | 320,728 | |||||||||||
Repayments of short-term borrowings | (387,120 | ) | (201,705 | ) | (3,000 | ) | (344,000 | ) | |||||||
Cash paid for shares withheld for taxes | (3,691 | ) | (5,674 | ) | (3,752 | ) | (6,736 | ) | |||||||
Excess tax benefit from stock compensation | 471 | 4,197 | — | 2,071 | |||||||||||
Cash received from issuances of common stock | — | — | — | 52 | |||||||||||
Cash paid for repurchases of common stock | (94,200 | ) | (107,239 | ) | — | — | |||||||||
Contingent consideration paid | (445 | ) | (115 | ) | (15,852 | ) | (22,628 | ) | |||||||
Loan origination costs on short-term borrowings | (62 | ) | (818 | ) | — | — | |||||||||
Proceeds from mortgage loan | — | 33,931 | — | — | |||||||||||
Mortgage loan origination costs | — | (338 | ) | — | — | ||||||||||
Repayment of mortgage principal | (493 | ) | (283 | ) | — | — | |||||||||
Net cash used in financing activities | (36,340 | ) | (78,260 | ) | (22,604 | ) | (50,513 | ) | |||||||
Effect of exchange rates on cash | (1,207 | ) | (10,703 | ) | 291 | 463 | |||||||||
Net change in cash and cash equivalents | 20,813 | (19,945 | ) | 7,963 | 126,878 | ||||||||||
Cash and cash equivalents at beginning of period | 225,143 | 245,088 | 237,125 | 110,247 | |||||||||||
Cash and cash equivalents at end of period | $ | 245,956 | $ | 225,143 | $ | 245,088 | $ | 237,125 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Supplemental disclosure of cash flow information: | |||||||||||||||
Cash paid during the period for: | |||||||||||||||
Income taxes | $ | 29,916 | $ | 53,504 | $ | 48,040 | $ | 39,122 | |||||||
Interest | 4,640 | 4,315 | 187 | 2,586 | |||||||||||
Non-cash investing and financing activities: | |||||||||||||||
Accrued for purchases of property and equipment | 2,640 | 3,419 | 4,265 | 2,283 | |||||||||||
Accrued for asset retirement obligations | 1,394 | 786 | 19 | 1,936 | |||||||||||
Accrued for shares withheld for taxes | 919 | — | — | 3,702 | |||||||||||
Write-off for shares exercised with a tax deficit | — | — | — | 1,752 |
• | the assets' ability to continue to generate income from operations and positive cash flow in future periods; |
• | changes in consumer demand or acceptance of the related brand names, products, or features associated with the assets; and |
• | other considerations that could affect fair value or otherwise indicate potential impairment. |
• | A significant decrease in the market price of a long-lived asset group; |
• | a significant adverse change in the extent or manner in which a long-lived asset group is being used or in its physical condition; |
• | a significant adverse change in legal factors or in business climate that could affect the value of a long-lived asset group, including an adverse action or assessment by a regulator; |
• | an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset group; |
• | a current-period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset group; or |
• | a current expectation that, more likely than not, a long-lived asset group will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. |
• | Level 1: Quoted prices in active markets for identical assets or liabilities. |
• | Level 2: Observable inputs other than quoted prices in active markets for identical assets and liabilities. |
• | Level 3: Unobservable inputs in which little or no market activity exists, therefore requiring the reporting entity to develop its own assumptions. |
Fair Value at March 31, 2016 | Fair Value Measurement Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||||
Assets (liabilities) at fair value | |||||||||||||||
Nonqualified deferred compensation asset | $ | 6,083 | $ | 6,083 | $ | — | $ | — | |||||||
Nonqualified deferred compensation liability | (6,301 | ) | (6,301 | ) | — | — | |||||||||
Designated derivatives asset | 2,903 | — | 2,903 | — | |||||||||||
Designated derivatives liability | (2,549 | ) | — | (2,549 | ) | — | |||||||||
Contingent consideration for acquisition of business | (20,000 | ) | — | — | (20,000 | ) |
Fair Value at March 31, 2015 | Fair Value Measurement Using | ||||||||||||||
Level 1 | Level 2 | Level 3 | |||||||||||||
Assets (liabilities) at fair value | |||||||||||||||
Nonqualified deferred compensation asset | $ | 5,581 | $ | 5,581 | $ | — | $ | — | |||||||
Nonqualified deferred compensation liability | (5,581 | ) | (5,581 | ) | — | — | |||||||||
Designated derivatives liability | (487 | ) | — | (487 | ) | — | |||||||||
Contingent consideration for acquisition of business | (25,700 | ) | — | — | (25,700 | ) |
Balance, April 1, 2014 | $ | 29,800 | |
Payments | (500 | ) | |
Change in fair value | (3,600 | ) | |
Balance, March 31, 2015 | 25,700 | ||
Payments | (1,300 | ) | |
Change in fair value | (4,400 | ) | |
Balance, March 31, 2016 | $ | 20,000 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||
2016 | 2015 | 2014 | 2013 | ||||||||
Weighted-average shares used in basic computation | 32,556,000 | 34,433,000 | 34,621,000 | 34,473,000 | |||||||
Dilutive effect of stock-based awards* | 483,000 | 300,000 | — | 356,000 | |||||||
Weighted-average shares used for diluted computation | 33,039,000 | 34,733,000 | 34,621,000 | 34,829,000 | |||||||
*Excluded NSUs | — | — | 331,000 | — | |||||||
*Excluded RSUs | 389,000 | 624,000 | 729,000 | 795,000 | |||||||
*Excluded outside director RSAs | — | — | 6,000 | — | |||||||
*Excluded SARs | 90,000 | 525,000 | 730,000 | 525,000 |
Useful life (years) | 3/31/2016 | 3/31/2015 | |||||||
Land | Indefinite | $ | 25,543 | $ | 25,543 | ||||
Building | 1 - 39 | 38,920 | 38,841 | ||||||
Machinery and equipment | 1-10 | 189,085 | 158,136 | ||||||
Furniture and fixtures | 1-7 | 38,948 | 36,751 | ||||||
Leasehold improvements | 1-10 | 108,557 | 102,048 | ||||||
401,053 | 361,319 | ||||||||
Less accumulated depreciation and amortization | 163,807 | 129,002 | |||||||
Net property and equipment | $ | 237,246 | $ | 232,317 |
3/31/2016 | 3/31/2015 | ||||||
Intangibles subject to amortization | |||||||
Weighted-average amortization period | 13 years | 13 years | |||||
Gross carrying amount | $ | 112,873 | $ | 109,604 | |||
Accumulated amortization | 45,302 | 37,316 | |||||
Net carrying amount | 67,571 | 72,288 | |||||
Intangibles not subject to amortization | |||||||
Goodwill | 127,934 | 127,934 | |||||
Trademarks | 15,455 | 15,455 | |||||
Total goodwill and other intangible assets | $ | 210,960 | $ | 215,677 |
Goodwill, Gross | Accumulated Impairment | Goodwill, Net | |||||||||
Balance, April 1, 2014 | $ | 143,765 | $ | (15,831 | ) | $ | 127,934 | ||||
Additions through acquisitions | — | — | — | ||||||||
Changes related to additions, impairments and other adjustments | — | — | — | ||||||||
Balance, March 31, 2015 | 143,765 | (15,831 | ) | 127,934 | |||||||
Additions through acquisitions | — | — | — | ||||||||
Changes related to additions, impairments and other adjustments | — | — | — | ||||||||
Balance, March 31, 2016 | $ | 143,765 | $ | (15,831 | ) | $ | 127,934 |
3/31/2016 | 3/31/2015 | ||||||
UGG brand | $ | 6,101 | $ | 6,101 | |||
Sanuk brand | 113,944 | 113,944 | |||||
Other brands | 7,889 | 7,889 | |||||
Total | $ | 127,934 | $ | 127,934 |
Balance, March 31, 2015 | $ | 87,743 | |
Purchase of intangible assets | 3,197 | ||
Amortization expense | (8,850 | ) | |
Changes in foreign currency exchange rates | 936 | ||
Balance, March 31, 2016 | $ | 83,026 |
Year ending March 31: | Expected Amortization Expense | |||
2017 | $ | 8,191 | ||
2018 | 8,078 | |||
2019 | 6,521 | |||
2020 | 4,193 | |||
2021 | 3,591 | |||
Thereafter | 29,154 | |||
$ | 59,728 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Current: | |||||||||||||||
Federal | $ | 11,971 | $ | 35,459 | $ | (572 | ) | $ | 51,058 | ||||||
State | 2,443 | 6,861 | (4 | ) | 6,252 | ||||||||||
Foreign | 12,039 | 7,069 | 5,255 | 6,650 | |||||||||||
Total | 26,453 | 49,389 | 4,679 | 63,960 | |||||||||||
Deferred: | |||||||||||||||
Federal | 7,887 | 8,234 | 1,669 | (2,580 | ) | ||||||||||
State | 1,113 | 624 | (1 | ) | (209 | ) | |||||||||
Foreign | (833 | ) | 1,112 | (4,404 | ) | (1,303 | ) | ||||||||
Total | 8,167 | 9,970 | (2,736 | ) | (4,092 | ) | |||||||||
Income tax expense | $ | 34,620 | $ | 59,359 | $ | 1,943 | $ | 59,868 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Computed expected income taxes | $ | 54,910 | $ | 77,399 | $ | (260 | ) | $ | 71,945 | ||||||
State income taxes, net of federal income tax benefit | 1,298 | 3,564 | 90 | 4,435 | |||||||||||
Foreign rate differential | (28,233 | ) | (25,535 | ) | 1,904 | (16,399 | ) | ||||||||
Unrecognized tax benefits | 3,670 | 3,566 | — | — | |||||||||||
Foreign tax expense on diminution of operations | 1,352 | — | — | — | |||||||||||
Other | 1,623 | 365 | 209 | (113 | ) | ||||||||||
Income tax expense | $ | 34,620 | $ | 59,359 | $ | 1,943 | $ | 59,868 |
3/31/2016 | 3/31/2015 | ||||||
Deferred tax assets (liabilities), current | |||||||
Uniform capitalization adjustment to inventory | $ | — | $ | 4,040 | |||
Bad debt and other reserves | — | 8,984 | |||||
State taxes | — | 482 | |||||
Prepaid expenses | — | (3,546 | ) | ||||
Accrued bonus | — | 4,120 | |||||
Foreign currency hedge | — | 434 | |||||
Other | — | (448 | ) | ||||
Total deferred tax assets, current | — | 14,066 | |||||
Deferred tax assets (liabilities), noncurrent: | |||||||
Amortization and impairment of intangible assets | (5,128 | ) | 1,004 | ||||
Depreciation of property and equipment | (8,804 | ) | (6,148 | ) | |||
Share-based compensation | 10,118 | 12,044 | |||||
Foreign currency translation | 151 | 720 | |||||
Deferred rent | 5,383 | 4,885 | |||||
Acquisition costs | 745 | 764 | |||||
Uniform capitalization adjustment to inventory | 5,280 | — | |||||
Bad debt and other reserves | 14,163 | — | |||||
State taxes | 863 | — | |||||
Prepaid expenses | (3,622 | ) | — | ||||
Accrued bonus | 536 | — | |||||
Foreign currency hedge | (94 | ) | — | ||||
Other | 1,045 | 1,327 | |||||
Net operating loss carryforwards | — | 421 | |||||
Total deferred tax assets, noncurrent | 20,636 | 15,017 | |||||
Net deferred tax assets, noncurrent | $ | 20,636 | $ | 29,083 |
Balance, April 1, 2014 | $ | — | |
Gross increase related to current year tax positions | 1,293 | ||
Gross increase related to prior year tax positions | 3,374 | ||
Balance, March 31, 2015 | 4,667 | ||
Gross increase related to current year tax positions | 2,332 | ||
Gross increase related to prior year tax positions | 2,059 | ||
Settlements | (363 | ) | |
Balance, March 31, 2016 | $ | 8,695 |
Year ending March 31: | Future Minimum Lease Commitments | |||
2017 | $ | 50,763 | ||
2018 | 51,087 | |||
2019 | 43,210 | |||
2020 | 35,179 | |||
2021 | 30,873 | |||
Thereafter | 104,328 | |||
$ | 315,440 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Minimum rentals | $ | 61,227 | $ | 61,363 | $ | 14,260 | $ | 47,871 | |||||||
Contingent rentals | 16,067 | 14,707 | 3,099 | 12,318 | |||||||||||
$ | 77,294 | $ | 76,070 | $ | 17,359 | $ | 60,189 |
Contract Effective Date | Final Target Date | Advance Deposit | Total Minimum Commitment | Remaining Deposit | Remaining Commitment, Net of Deposit | |||||||||||||
May 2015 | September 2016 | $ | — | $ | 82,800 | $ | 16,651 | $ | 13,374 | |||||||||
September 2015 | September 2016 | — | 46,865 | — | 28,060 | |||||||||||||
September 2015 | September 2017 | — | 7,200 | — | 5,711 | |||||||||||||
September 2015 | September 2017 | — | 55,200 | — | 55,200 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Compensation expense recorded for: | |||||||||||||||
NSUs | $ | 6,163 | $ | 9,295 | $ | 1,863 | $ | 10,545 | |||||||
SARs | 893 | 1,846 | 381 | 1,302 | |||||||||||
RSUs | (1,511 | ) | 1,323 | 354 | 287 | ||||||||||
Directors' shares | 1,077 | 1,060 | 267 | 1,002 | |||||||||||
Total compensation expense | 6,622 | 13,524 | 2,865 | 13,136 | |||||||||||
Income tax benefit recognized | (2,525 | ) | (5,143 | ) | (1,082 | ) | (4,950 | ) | |||||||
Net compensation expense | $ | 4,097 | $ | 8,381 | $ | 1,783 | $ | 8,186 |
Unrecognized Compensation Cost | Weighted-Average Remaining Vesting Period (Years) | ||||
NSUs | $ | 6,568 | 1.2 | ||
SARs | 117 | 0.8 | |||
RSUs | 17 | 0.8 | |||
Total | $ | 6,702 |
Number of Shares | Weighted- Average Grant-Date Fair Value | |||||
Nonvested at January 1, 2013 | 371,000 | $ | 58.51 | |||
Granted | 304,000 | 57.30 | ||||
Vested | (315,000 | ) | 53.19 | |||
Forfeited | (20,000 | ) | 61.08 | |||
Nonvested at December 31, 2013 | 340,000 | 62.23 | ||||
Granted | — | — | ||||
Vested | (2,000 | ) | 58.11 | |||
Forfeited | (7,000 | ) | 64.15 | |||
Nonvested at March 31, 2014 | 331,000 | 62.21 | ||||
Granted | 196,000 | 82.34 | ||||
Vested | (142,000 | ) | 68.39 | |||
Forfeited | (30,000 | ) | 64.18 | |||
Cancelled* | (15,000 | ) | 84.04 | |||
Nonvested at March 31, 2015 | 340,000 | 70.11 | ||||
Granted | 240,000 | 70.82 | ||||
Vested | (132,000 | ) | 66.74 | |||
Forfeited | (91,000 | ) | 72.84 | |||
Cancelled* | (154,000 | ) | 74.22 | |||
Nonvested at March 31, 2016 | 203,000 | 68.80 |
Number of SARs | Weighted- Average Exercise Price | Weighted- Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value | |||||||||
Outstanding at January 1, 2013 | 745,000 | $ | 26.73 | 7.9 | $ | 10,100 | ||||||
Granted | — | — | ||||||||||
Exercised | (15,000 | ) | 26.73 | |||||||||
Forfeited | — | — | ||||||||||
Outstanding at December 31, 2013 | 730,000 | 26.73 | 6.9 | 42,100 | ||||||||
Granted | — | — | ||||||||||
Exercised | — | — | ||||||||||
Forfeited | — | — | ||||||||||
Outstanding at March 31, 2014 | 730,000 | 26.73 | 6.7 | 38,700 | ||||||||
Granted | — | — | ||||||||||
Exercised | (15,000 | ) | 26.73 | |||||||||
Forfeited | — | — | ||||||||||
Outstanding at March 31, 2015 | 715,000 | 26.73 | 5.8 | 33,000 | ||||||||
Granted | — | — | ||||||||||
Exercised | (80,000 | ) | 26.73 | |||||||||
Forfeited | (15,000 | ) | 26.73 | |||||||||
Outstanding at March 31, 2016 | 620,000 | 26.73 | 3.5 | 20,600 | ||||||||
Exercisable at March 31, 2016 | 530,000 | 26.73 | 3.3 | 17,600 | ||||||||
Expected to vest and exercisable at March 31, 2016 | 620,000 | 26.73 | 3.5 | 20,600 |
Number of Shares | Weighted- Average Grant-Date Fair Value | |||||
Nonvested at January 1, 2013 | 671,000 | $ | 62.80 | |||
Granted | 156,000 | 84.52 | ||||
Vested | — | — | ||||
Forfeited | (32,000 | ) | 63.69 | |||
Nonvested at December 31, 2013 | 795,000 | 67.03 | ||||
Granted | — | — | ||||
Vested | — | — | ||||
Forfeited | (66,000 | ) | 67.23 | |||
Nonvested at March 31, 2014 | 729,000 | 67.01 | ||||
Granted | 160,000 | 98.29 | ||||
Vested | — | — | ||||
Forfeited | (35,000 | ) | 78.39 | |||
Cancelled* | (230,000 | ) | 82.09 | |||
Nonvested at March 31, 2015 | 624,000 | 68.82 | ||||
Granted | 308,000 | 50.05 | ||||
Vested | (47,000 | ) | 26.73 | |||
Forfeited | (232,000 | ) | 70.98 | |||
Cancelled* | (264,000 | ) | 63.22 | |||
Nonvested at March 31, 2016 | 389,000 | 61.53 |
Years ended March 31, | |||
2016 | 2015 | ||
Derivatives in designated cash flow hedging relationships | Foreign currency exchange contracts | Foreign currency exchange contracts | |
Amount of (loss) gain recognized in other comprehensive income (loss) on derivatives (effective portion) | $(850) | $1,556 | |
Location of amount reclassified from accumulated other comprehensive income (loss) into income (effective portion) | Net Sales | Net Sales | |
Amount of (loss) gain reclassified from accumulated other comprehensive income (loss) into income (effective portion) | $(1,592) | $1,226 | |
Location of amount excluded from effectiveness testing | Selling, general and administrative expenses | Selling, general and administrative expenses | |
Amount of gain (loss) excluded from effectiveness testing | $207 | $(69) |
Years ended March 31, | |||
2016 | 2015 | ||
Derivatives not designated as hedging instruments | Foreign currency exchange contracts | Foreign currency exchange contracts | |
Location of amount recognized in income on derivatives | Selling, general and administrative expenses | Selling, general and administrative expenses | |
Amount of (loss) gain recognized in income on derivatives | $(1,532) | $6,383 |
Three Months Ended March 31, | |||||||
2014 | 2013 (unaudited) | ||||||
Net sales | $ | 294,716 | $ | 263,760 | |||
Cost of sales | 150,456 | 140,201 | |||||
Gross profit | 144,260 | 123,559 | |||||
Selling, general and administrative expenses | 144,668 | 120,907 | |||||
(Loss) income from operations | (408 | ) | 2,652 | ||||
Other expense (income), net: | |||||||
Interest income | (65 | ) | (26 | ) | |||
Interest expense | 516 | 339 | |||||
Other, net | (117 | ) | (171 | ) | |||
Total other expense, net | 334 | 142 | |||||
(Loss) income before income taxes | (742 | ) | 2,510 | ||||
Income tax expense | 1,943 | 1,503 | |||||
Net (loss) income | (2,685 | ) | 1,007 | ||||
Other comprehensive (loss) income, net of tax: | |||||||
Unrealized (loss) gain on foreign currency hedging | (273 | ) | 1,530 | ||||
Foreign currency translation adjustment | 873 | (674 | ) | ||||
Total other comprehensive income | 600 | 856 | |||||
Comprehensive (loss) income | $ | (2,085 | ) | $ | 1,863 | ||
Net (loss) income per share: | |||||||
Basic | $ | (0.08 | ) | $ | 0.03 | ||
Diluted | $ | (0.08 | ) | $ | 0.03 | ||
Weighted-average common shares outstanding: | |||||||
Basic | 34,621 | 34,404 | |||||
Diluted | 34,621 | 34,788 |
3/31/2016 | 3/31/2015 | ||||||
Cumulative foreign currency translation adjustment | $ | (20,709 | ) | $ | (20,159 | ) | |
Unrealized gain (loss) on foreign currency hedging, net of tax | 152 | (309 | ) | ||||
Accumulated other comprehensive loss | $ | (20,557 | ) | $ | (20,468 | ) |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Net sales to external customers: | |||||||||||||||
UGG wholesale | $ | 918,102 | $ | 903,926 | $ | 83,271 | $ | 818,377 | |||||||
Teva wholesale | 121,239 | 116,931 | 45,283 | 109,334 | |||||||||||
Sanuk wholesale | 90,719 | 102,690 | 28,793 | 94,420 | |||||||||||
Other brands wholesale | 100,820 | 76,152 | 18,662 | 38,276 | |||||||||||
Direct-to-Consumer | 644,317 | 617,358 | 118,707 | 496,211 | |||||||||||
$ | 1,875,197 | $ | 1,817,057 | $ | 294,716 | $ | 1,556,618 | ||||||||
Income (loss) from operations: | |||||||||||||||
UGG wholesale | $ | 246,990 | $ | 269,489 | $ | 13,595 | $ | 224,738 | |||||||
Teva wholesale | 17,692 | 13,320 | 6,425 | 9,166 | |||||||||||
Sanuk wholesale | 15,565 | 21,914 | 7,530 | 20,591 | |||||||||||
Other brands wholesale | (4,384 | ) | (9,838 | ) | (758 | ) | (9,807 | ) | |||||||
Direct-to-Consumer | 101,756 | 150,320 | 20,918 | 132,532 | |||||||||||
Unallocated overhead costs | (215,492 | ) | (220,786 | ) | (48,118 | ) | (169,323 | ) | |||||||
$ | 162,127 | $ | 224,419 | $ | (408 | ) | $ | 207,897 | |||||||
Depreciation and amortization: | |||||||||||||||
UGG wholesale | $ | 2,107 | $ | 5,029 | $ | 137 | $ | 641 | |||||||
Teva wholesale | 54 | 94 | 33 | 641 | |||||||||||
Sanuk wholesale | 6,556 | 6,969 | 1,769 | 7,761 | |||||||||||
Other brands wholesale | 1,101 | 940 | 250 | 507 | |||||||||||
Direct-to-Consumer | 18,931 | 21,088 | 5,209 | 21,861 | |||||||||||
Unallocated overhead costs | 20,992 | 15,030 | 3,140 | 9,959 | |||||||||||
$ | 49,741 | $ | 49,150 | $ | 10,538 | $ | 41,370 | ||||||||
Capital expenditures: | |||||||||||||||
UGG wholesale | $ | 1,458 | $ | 246 | $ | 119 | $ | 313 | |||||||
Teva wholesale | — | 51 | — | 63 | |||||||||||
Sanuk wholesale | 881 | 487 | 2 | 91 | |||||||||||
Other brands wholesale | 51 | 351 | 26 | 477 | |||||||||||
Direct-to-Consumer | 18,445 | 19,128 | 3,557 | 35,669 | |||||||||||
Unallocated overhead costs | 45,351 | 71,590 | 13,916 | 43,217 | |||||||||||
$ | 66,186 | $ | 91,853 | $ | 17,620 | $ | 79,830 | ||||||||
Total assets from reportable segments: | |||||||||||||||
UGG wholesale | $ | 248,937 | $ | 194,720 | $ | 153,341 | $ | 314,122 | |||||||
Teva wholesale | 87,225 | 77,423 | 81,766 | 54,868 | |||||||||||
Sanuk wholesale | 212,816 | 224,974 | 214,627 | 208,669 | |||||||||||
Other brands wholesale | 65,072 | 53,634 | 41,281 | 34,315 | |||||||||||
Direct-to-Consumer | 148,733 | 147,423 | 163,664 | 189,822 | |||||||||||
$ | 762,783 | $ | 698,174 | $ | 654,679 | $ | 801,796 |
3/31/2016 | 3/31/2015 | ||||||
Total assets from reportable segments | $ | 762,783 | $ | 698,174 | |||
Unallocated cash and cash equivalents | 245,956 | 225,143 | |||||
Unallocated deferred tax assets | 20,636 | 29,083 | |||||
Other unallocated corporate assets | 248,693 | 217,533 | |||||
Consolidated total assets | $ | 1,278,068 | $ | 1,169,933 |
3/31/2016 | 3/31/2015 | ||||||
US | $ | 211,111 | $ | 196,513 | |||
All other countries* | 26,135 | 35,804 | |||||
Total | $ | 237,246 | $ | 232,317 |
3/31/2016 | 3/31/2015 | ||||||
Money market fund accounts | $ | 195,575 | $ | 127,900 | |||
Cash | 50,381 | 97,243 | |||||
Total cash and cash equivalents | $ | 245,956 | $ | 225,143 |
Fiscal Year 2016 | |||||||||||||||
6/30/2015 | 9/30/2015 | 12/31/2015 | 3/31/2016* | ||||||||||||
Net sales | $ | 213,805 | $ | 486,855 | $ | 795,902 | $ | 378,635 | |||||||
Gross profit | 86,596 | 214,113 | 391,017 | 154,942 | |||||||||||
Net (loss) income | (47,327 | ) | 36,377 | 156,921 | (23,706 | ) | |||||||||
Net (loss) income per share: | |||||||||||||||
Basic | $ | (1.43 | ) | $ | 1.12 | $ | 4.85 | $ | (0.73 | ) | |||||
Diluted | $ | (1.43 | ) | $ | 1.11 | $ | 4.78 | $ | (0.73 | ) |
Fiscal Year 2015 | |||||||||||||||
6/30/2014 | 9/30/2014 | 12/31/2014 | 3/31/2015 | ||||||||||||
Net sales | $ | 211,469 | $ | 480,273 | $ | 784,678 | $ | 340,637 | |||||||
Gross profit | 86,772 | 223,873 | 415,139 | 152,324 | |||||||||||
Net (loss) income | (37,062 | ) | 40,730 | 156,706 | 1,406 | ||||||||||
Net (loss) income per share: | |||||||||||||||
Basic | $ | (1.07 | ) | $ | 1.18 | $ | 4.54 | $ | 0.04 | ||||||
Diluted | $ | (1.07 | ) | $ | 1.17 | $ | 4.50 | $ | 0.04 |
Years ended March 31, | Quarter ended (transition period) March 31, | Year ended December 31, | |||||||||||||
2016 | 2015 | 2014 | 2013 | ||||||||||||
Allowance for doubtful accounts (1) | |||||||||||||||
Balance at Beginning of Year | $ | 2,297 | $ | 1,798 | $ | 2,039 | $ | 2,782 | |||||||
Additions | 5,120 | 1,107 | 594 | 125 | |||||||||||
Deductions | 1,923 | 608 | 835 | 868 | |||||||||||
Balance at End of Year | $ | 5,494 | $ | 2,297 | $ | 1,798 | $ | 2,039 | |||||||
Allowance for sales discounts (2) | |||||||||||||||
Balance at Beginning of Year | $ | 2,348 | $ | 2,121 | $ | 3,540 | $ | 3,836 | |||||||
Additions | 93,431 | 68,620 | 978 | 46,989 | |||||||||||
Deductions | 93,107 | 68,393 | 2,397 | 47,285 | |||||||||||
Balance at End of Year | $ | 2,672 | $ | 2,348 | $ | 2,121 | $ | 3,540 | |||||||
Allowance for sales returns (3) | |||||||||||||||
Balance at Beginning of Year | $ | 9,532 | $ | 8,586 | $ | 14,554 | $ | 12,905 | |||||||
Additions | 112,675 | 94,138 | 674 | 67,800 | |||||||||||
Deductions | 105,146 | 93,192 | 6,642 | 66,151 | |||||||||||
Balance at End of Year | $ | 17,061 | $ | 9,532 | $ | 8,586 | $ | 14,554 | |||||||
Chargeback allowance (4) | |||||||||||||||
Balance at Beginning of Year | $ | 4,041 | $ | 3,064 | $ | 4,935 | $ | 5,563 | |||||||
Additions | 2,267 | 2,610 | 213 | 187 | |||||||||||
Deductions | 1,340 | 1,633 | 2,084 | 815 | |||||||||||
Balance at End of Year | $ | 4,968 | $ | 4,041 | $ | 3,064 | $ | 4,935 | |||||||
Total | $ | 30,195 | $ | 18,218 | $ | 15,569 | $ | 25,068 |
(1) | The additions to the allowance for doubtful accounts represent estimates of the Company's bad debt expense based upon the factors for which the Company evaluates the collectability of its accounts receivable, with actual recoveries netted into additions. Deductions are the actual write offs of the receivables. |
(2) | The additions to the allowance for sales discounts represent estimates of discounts to be taken by the Company's customers based upon the amount of available outstanding terms discounts in the year-end aging. Deductions are the actual discounts taken by the Company's customers. |
(3) | The additions to the allowance for sales returns represent estimates of returns based upon the Company's historical returns experience. Deductions are the actual returns of products. |
(4) | The additions to the chargeback allowance represent chargebacks taken in the respective year as well as an estimate of chargebacks related to sales in the respective reporting period that will be taken subsequent to the respective reporting period. Deductions are the actual chargebacks written off against outstanding accounts receivable. For the fiscal years 2016, 2015 and 2013 and the quarter ended March 31, 2014, the Company has estimated the additions and deductions by netting each quarter's change and summing the four quarters for the respective year. |
Name of Entity | State or Other Jurisdiction of Incorporation or Organization | |
Deckers Asia Pacific Retail Limited | Hong Kong | |
Deckers Consumer Direct Corporation | USA (Arizona) | |
Deckers International Limited | Bermuda | |
Deckers Macau Limited | Macau | |
Deckers Europe Limited | United Kingdom | |
Deckers Asia Pacific Limited | Hong Kong | |
Deckers UK, LTD | United Kingdom | |
Deckers Beijing Trading Co., Ltd | China | |
Deckers Japan GK | Japan | |
Deckers Outdoor (Guangzhou) Consulting Co., Ltd | China | |
Deckers Dutch Coöperatie UA | Netherlands | |
Deckers France SAS | France | |
Deckers Benelux BV | Netherlands | |
Deckers Outdoor Canada ULC | British Columbia | |
Deckers Cabrillo, LLC | USA (California) | |
Deckers Retail, LLC | USA (California) | |
Deckers Sales Co. LLC | USA (California) | |
Deckers Belgium BVBA | Belgium | |
Deckers Cabrillo II, LLC | USA (California) | |
Deckers Footwear (Shanghai) Co., Ltd. | China | |
Deckers Germany | Germany | |
Deckers Austria GmbH | Austria |
1. | I have reviewed this annual report on Form 10-K of Deckers Outdoor Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
/s/ ANGEL R. MARTINEZ |
Angel R. Martinez Chief Executive Officer Deckers Outdoor Corporation |
1. | I have reviewed this annual report on Form 10-K of Deckers Outdoor Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
/s/ THOMAS A. GEORGE |
Thomas A. George Chief Financial Officer Deckers Outdoor Corporation |
/s/ ANGEL R. MARTINEZ | |
Angel R. Martinez | |
Chief Executive Officer | |
Deckers Outdoor Corporation | |
(Principal Executive Officer) | |
/s/ THOMAS A. GEORGE | |
Thomas A. George | |
Chief Financial Officer | |
Deckers Outdoor Corporation | |
(Principal Financial and Accounting Officer) | |
Date: May 31, 2016 |
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Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Mar. 31, 2016 |
May. 13, 2016 |
Sep. 30, 2015 |
|
Document and Entity Information | |||
Entity Registrant Name | DECKERS OUTDOOR CORP | ||
Entity Central Index Key | 0000910521 | ||
Document Type | 10-K | ||
Document Period End Date | Mar. 31, 2016 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --03-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,866,513,908 | ||
Entity Common Stock, Shares Outstanding | 32,023,300 | ||
Document Fiscal Year Focus | 2016 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Mar. 31, 2016 |
Mar. 31, 2015 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Trade accounts receivable, allowances (in dollars) | $ 30,195 | $ 18,218 |
Accumulated depreciation | 163,807 | 129,002 |
Accumulated amortization | $ 45,302 | $ 37,316 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 125,000,000 | 125,000,000 |
Common stock, issued shares | 32,020,000 | 33,292,000 |
Common stock, outstanding shares | 32,020,000 | 33,292,000 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2014 |
Mar. 31, 2014 |
Mar. 31, 2013 |
Jun. 30, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Income Statement [Abstract] | |||||||||||||
Net sales | $ 378,635 | $ 795,902 | $ 486,855 | $ 213,805 | $ 340,637 | $ 784,678 | $ 480,273 | $ 294,716 | $ 263,760 | $ 211,469 | $ 1,875,197 | $ 1,817,057 | $ 1,556,618 |
Cost of sales | 150,456 | 140,201 | 1,028,529 | 938,949 | 820,135 | ||||||||
Gross profit | $ 154,942 | $ 391,017 | $ 214,113 | $ 86,596 | $ 152,324 | $ 415,139 | $ 223,873 | 144,260 | 123,559 | $ 86,772 | 846,668 | 878,108 | 736,483 |
Selling, general and administrative expenses | 144,668 | 120,907 | 684,541 | 653,689 | 528,586 | ||||||||
Income (loss) from operations | (408) | 2,652 | 162,127 | 224,419 | 207,897 | ||||||||
Other expense (income), net: | |||||||||||||
Interest income | (65) | (26) | (420) | (207) | (60) | ||||||||
Interest expense | 516 | 339 | 5,814 | 4,220 | 3,079 | ||||||||
Other, net | (117) | (171) | (152) | (733) | (679) | ||||||||
Total other expense, net | 334 | 142 | 5,242 | 3,280 | 2,340 | ||||||||
Income (loss) before income taxes | (742) | 2,510 | 156,885 | 221,139 | 205,557 | ||||||||
Income tax expense | 1,943 | 1,503 | 34,620 | 59,359 | 59,868 | ||||||||
Net income (loss) | (2,685) | 1,007 | 122,265 | 161,780 | 145,689 | ||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||
Unrealized gain (loss) on foreign currency hedging | (273) | 1,530 | 461 | 450 | (486) | ||||||||
Foreign currency translation adjustment | 873 | (674) | (550) | (18,875) | (757) | ||||||||
Total other comprehensive (loss) income | 600 | 856 | (89) | (18,425) | (1,243) | ||||||||
Comprehensive income (loss) | $ (2,085) | $ 1,863 | $ 122,176 | $ 143,355 | $ 144,446 | ||||||||
Net income (loss) per share: | |||||||||||||
Basic (in dollars per share) | $ (0.73) | $ 4.85 | $ 1.12 | $ (1.43) | $ 0.04 | $ 4.54 | $ 1.18 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.76 | $ 4.70 | $ 4.23 |
Diluted (in dollars per share) | $ (0.73) | $ 4.78 | $ 1.11 | $ (1.43) | $ 0.04 | $ 4.50 | $ 1.17 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.70 | $ 4.66 | $ 4.18 |
Weighted-average common shares outstanding: | |||||||||||||
Basic (in shares) | 34,621 | 34,404 | 32,556 | 34,433 | 34,473 | ||||||||
Diluted (in shares) | 34,621 | 34,788 | 33,039 | 34,733 | 34,829 |
The Company and Summary of Significant Accounting Policies |
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The Company and Summary of Significant Accounting Policies | The Company and Summary of Significant Accounting Policies The Company and Basis of Presentation The consolidated financial statements include the accounts of Deckers Outdoor Corporation and its wholly-owned subsidiaries (collectively referred to as the "Company"). Accordingly, all references herein to Deckers Outdoor Corporation or "Deckers" include the consolidated results of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Deckers Outdoor Corporation is a global leader in designing, marketing and distributing innovative footwear, apparel and accessories developed for both everyday casual lifestyle use and high performance activities. The Company's business is seasonal, with the highest percentage of UGG® brand net sales occurring in the quarters ending September 30 and December 31 and the highest percentage of Teva® and Sanuk® brand net sales occurring in the quarters ending March 31 and June 30 of each year. The Company sells its products through quality domestic retailers and international distributors and retailers, as well as directly to end-user consumers through the Direct-to-Consumer (DTC) reporting segment. Independent third parties manufacture all of the Company's products. In July 2014, the Company acquired its UGG brand distributor that sold to retailers in Germany and continues to operate as a wholesale business in Germany through the newly acquired subsidiary. The acquisition included certain intangible and tangible assets and the assumption of liabilities. The purchase price of the acquisition was not material to the Company’s consolidated financial statements. In April 2015, the Company acquired inventory and certain intangible assets, including the trade name related to the Koolaburra® brand, a sheepskin and wool based footwear brand. The purchase price of the acquisition was not material to the Company's consolidated financial statements. In July 2015, the Company sold certain tangible and intangible assets, including approximately $1,500 of inventory, and the trade name related to the MOZO® brand, a footwear brand crafted for culinary professionals. In February 2016, the Company sold certain tangible and intangible assets, including the trade name related to the TSUBO brand, a line of mid and high-end dress and dress casual footwear. The impacts of these sales were not material to the Company's consolidated financial statements. Change in Fiscal Year In February 2014, the Company's Board of Directors (the Board) approved a change in its fiscal year end from December 31 to March 31. The change was intended to better align the Company's planning, financial and reporting functions with the seasonality of the business. The 2016, 2015 and 2013 fiscal years are for the periods ended March 31, 2016, March 31, 2015 and December 31, 2013, respectively. The transition period was the quarter ended March 31, 2014 to coincide with the change in the Company's fiscal year end. Business Segment Reporting During the first quarter of fiscal year 2016, the Company changed its reportable operating segments to combine the previously separated retail store and E-Commerce operating components into one DTC reportable operating segment. The Company now has five reportable operating segments including the strategic business units for the worldwide wholesale operations of the UGG brand, Teva brand, Sanuk brand, other brands, and the DTC business and it is by these segments that information is reported to the Chief Operating Decision Maker (CODM). The CODM is the Principal Executive Officer. The Company performs an annual analysis of the appropriateness of its reportable segments. Refer to Note 12 for further information related to the Company's business segments. Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents include $195,575 and $127,900 of money market funds at March 31, 2016 and March 31, 2015, respectively. Allowance for Doubtful Accounts The Company provides an allowance against trade accounts receivable for estimated losses that may result from customers' inability to pay. The Company determines the amount of the allowance by analyzing known uncollectible accounts, aged trade accounts receivables, economic conditions and forecasts, historical experience and the customers' credit-worthiness. Trade accounts receivable that are subsequently determined to be uncollectible are charged or written off against this allowance. Write-offs against this allowance are recorded in selling, general and administrative (SG&A) expense in the consolidated statements of comprehensive income (loss). The allowance includes specific allowances for trade accounts, all or a portion of which are identified as potentially uncollectible, plus a non-specific allowance for the balance of accounts based on the Company's historical loss experience. Allowances have been established for all projected losses of this nature. Inventories Inventories, principally finished goods, are stated at the lower of cost (first-in, first-out) or market (net realizable value). Cost includes initial molds and tooling that are amortized over the life of the mold in cost of sales in the consolidated statements of comprehensive income (loss). Cost also includes shipping and handling fees and costs, which are subsequently expensed to cost of sales. Market values are determined by historical experience with discounted sales, industry trends and the retail environment. Property and Equipment, Depreciation and Amortization Property and equipment has a useful life expectancy of at least one year. Property and equipment includes tangible, non-consumable items owned by the Company valued at or above $3, certain computer software costs and internal or external computer system consulting work valued at or above $3 as defined below, and portable electronic devices valued at or above $1.5. Tangible, non-consumable items below these amounts are expensed. The value includes the purchase price, sales tax and costs to acquire (shipping and handling), install (excluding site preparation costs), secure and prepare the item for its intended use. Depreciation of property and equipment is calculated using the straight-line method based on estimated useful lives. Capitalized website costs, which are included in the machinery and equipment category, are immaterial to the Company's consolidated financial statements. Leasehold improvements are amortized to their residual value, if any, on the straight-line basis over their estimated economic useful lives or the lease term, whichever is shorter. The Company allocates depreciation and amortization of property, plant, and equipment to cost of sales and SG&A expenses in the consolidated statements of comprehensive income (loss). The majority of the Company's depreciation and amortization is included in SG&A expenses in the consolidated statements of comprehensive income (loss) due to the nature of its operations. Most of the Company's depreciation and amortization is from its warehouses, its corporate headquarters and its retail stores. The Company outsources all manufacturing; therefore, the amount allocated to cost of sales is not material. Goodwill and Other Intangible Assets Intangible assets consist primarily of goodwill, trademarks, customer and distributor relationships, patents, lease rights, and non-compete agreements arising from the application of purchase accounting. Intangible assets with estimable useful lives are amortized and reviewed for impairment. Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually, at December 31, except for the Teva trademarks and Sanuk goodwill, which are tested at October 31. The assessment of goodwill impairment involves valuing the Company's reporting units that carry goodwill. Currently, the Company's reporting units are the same as the Company's operating segments. The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The Company does not calculate the fair value of the reporting unit unless the Company determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. If the Company determines this, then the first quantitative step is a comparison of the fair value of the reporting unit with its carrying amount. If the fair value exceeds the carrying amount, goodwill is not impaired. If the fair value of the reporting unit is below the carrying amount, then a second step is performed to measure the amount of the impairment, if any. The test for impairment involves the use of estimates related to the fair values of the business operations with which goodwill is associated and the fair values of the intangible assets with indefinite lives. The Company also evaluates the fair values of other intangible assets with indefinite useful lives in relation to their carrying values. The Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative assessment of the indefinite life intangible asset. The Company does not calculate the fair value of the indefinite life intangible unless the Company determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. If the Company concludes that it is more likely than not that its fair value is less than its carrying amount, then the Company compares the fair value of the indefinite life intangible to its carrying amount, and if the fair value of the indefinite life intangible exceeds its carrying amount, no impairment charge will be recognized. If the fair value of the indefinite life intangible is less than the carrying amount, the Company will record an impairment charge to write-down the intangible asset to its fair value. Impairment and amortization are recorded in SG&A expenses in the consolidated statements of comprehensive income (loss). Determining fair value of goodwill and other intangible assets is highly subjective and requires the use of estimates and assumptions. The Company uses estimates including future revenues, royalty rates, discount rates, attrition rates, and market multiples, among others. The Company also considers the following factors:
In addition, facts and circumstances could change, including further deterioration of general economic conditions or the retail environment, customers reducing orders in response to such conditions, and increased competition. These or other factors could result in changes to the calculation of fair value which could result in impairment of the Company's remaining goodwill and other intangible assets. Changes in any one or more of these estimates and assumptions could produce different financial results. Accounting for Long-Lived Assets Other long-lived assets, such as machinery and equipment, internal use software, leasehold improvements, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount exceeds the estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount exceeds the fair value of the asset. Intangible assets subject to amortization are amortized over their respective estimated useful lives to their estimated residual values, if any. The Company uses the straight-line method for depreciation and amortization of long-lived assets, except for certain intangible assets where the Company can reliably determine the pattern in which the economic benefits of the assets will be consumed. At least quarterly, the Company evaluates whether any impairment triggering events, including the following, have occurred which would require such asset groups to be tested for impairment:
When an impairment triggering event has occurred, the Company tests for recoverability of the asset group's carrying value using estimates of undiscounted future cash flows based on the existing service potential of the applicable asset group. In determining the service potential of a long-lived asset group, the Company considers its remaining useful life, cash-flow generating capacity, and physical output capacity. These estimates include the undiscounted cash flows associated with future expenditures necessary to maintain the existing service potential. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The Company assesses potential impairment of its retail group long-lived assets by comparing projected 12 months store cash flows to the current carrying value of the store's long-lived assets. Stores that have been opened for more than one year, or have otherwise been identified by management as having one or more indicators of impairment, with projected 12 months cash flows less than the current carrying amount of the store's long-lived assets are then reviewed to determine if an impairment exists. An impairment loss, if any, would only reduce the carrying amount of long-lived assets in the group based on the fair value of the group assets. Impairment is recorded in SG&A expenses in the consolidated statements of comprehensive income (loss). Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in the consolidated statements of comprehensive income (loss) in the period that includes the enactment date. The Company recognizes the effect of income tax positions in the financial statements only if those positions are more likely than not of being sustained upon examination. Recognized income tax positions are measured at the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company accounts for interest and penalties accrued for income tax contingencies as interest expense in the consolidated statements of comprehensive income (loss). Fair Value Measurements The fair values of the Company's cash and cash equivalents, trade accounts receivable, prepaid expenses, income taxes receivable, other current assets, short-term borrowings, trade accounts payable, accrued payroll, other accrued expenses, income taxes payable and value added tax payable approximate the carrying values due to the relatively short maturities of these instruments. The fair values of the Company's long-term liabilities, other than contingent consideration, recalculated using current interest rates, would not significantly differ from the carrying values. The fair value of the contingent consideration related to acquisitions and of the Company's derivatives are measured and recorded at fair value on a recurring basis. Changes in fair value of contingent consideration resulting from either accretion or changes in discount rates or in the expectations of achieving the performance targets are recorded in SG&A expenses. The Company records the fair value of assets or liabilities associated with derivative instruments and hedging activities in other current assets or other accrued expenses, respectively, in the consolidated balance sheets. The inputs used in measuring fair value are prioritized into the following hierarchy:
The assets and liabilities that are measured on a recurring basis at fair value are summarized as follows:
The Level 2 inputs consist of forward spot rates at the end of the reporting period. Sanuk. The purchase price for the Sanuk brand, acquired in July 2011, included contingent consideration payments. The final contingent consideration payment of approximately $19,700, which is 40.0% of the Sanuk brand gross profit in calendar year 2015, was paid subsequent to March 31, 2016. Hoka. The purchase price for the Hoka brand, acquired in September 2012, includes contingent consideration through calendar year 2017, with a maximum of $2,000, of which approximately $1,700 has been paid. The maximum of $2,000 was achieved during the fiscal year ended March 31, 2016. At March 31, 2016, the final contingent consideration payment of approximately $300 is pending final disbursement. At March 31, 2016, contingent consideration for both brands was included in other accrued expenses in the consolidated balance sheets. The following table presents a reconciliation of the Level 3 measurement (rounded):
Refer to Note 7 for further information on the contingent consideration arrangements. Nonqualified Deferred Compensation In 2010, the Company established a nonqualified deferred compensation program that permits a select group of management employees to defer earnings to a future date on a nonqualified basis. For each plan year, on behalf of the Company, the Company's Board may, but is not required to, contribute any amount it desires to any participant under this program. The Company's contribution will be determined by the Board annually. In March 2015, the Board approved a contribution for calendar year 2016 and gave the authority to management to approve the payment. At March 31, 2016, no payment was pending. The value of the deferred compensation is recognized based on the fair value of the participants' accounts. The Company has established a rabbi trust for the purpose of supporting the benefits payable under this program, with the assets invested in company-owned life insurance (COLI) policies. Deferred compensation of $308 is included in other accrued expenses and $5,993 is included in other long-term liabilities in the consolidated balance sheets at March 31, 2016. Deferred compensation of $540 is included in other accrued expenses and $5,041 is included in other long-term liabilities in the consolidated balance sheets at March 31, 2015. Stock Compensation All of the Company's stock compensation awards are classified within stockholders' equity. Stock compensation cost is measured at the grant date based on the value of the award and is expensed ratably over the service period. The Company recognizes expense only for those awards that management deems probable of achieving the performance and service objectives. Determining the fair value and related expense of share-based awards requires judgment, including estimating the percentage of awards that will be forfeited and probabilities of meeting the awards' performance criteria. If actual forfeitures differ significantly from the estimates or if probabilities change during a period, stock compensation expense and the Company's results of operations could be materially impacted. Stock compensation expense is included in SG&A expense in the consolidated statements of comprehensive income (loss). Revenue Recognition The Company recognizes wholesale, E-Commerce, and international distributor revenue when products are shipped and retail revenue at the point of sale. All sales are recognized when the customer takes title and assumes risk of loss, collection of the related receivable is reasonably assured, persuasive evidence of an arrangement exists, and the sales price is fixed or determinable. For wholesale and international distributor sales, allowances for estimated returns, discounts, chargebacks, and bad debts are provided for when related revenue is recorded. For E-Commerce sales, allowances for estimated returns and bad debts are provided for when related revenue is recorded. For retail sales, allowances for estimated returns are provided for when related revenue is recorded. Amounts billed for shipping and handling costs are recorded as a component of net sales, while the related costs paid to third-party shipping companies are recorded as a cost of sales. The Company presents revenue net of taxes collected from customers and remitted to governmental authorities. Research and Development Costs All research and development costs are expensed as incurred. Such costs amounted to $22,176, $20,872, $4,486 and $19,257 for the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014 and the year ended December 31, 2013, respectively, and are included in SG&A expenses in the consolidated statements of comprehensive income (loss). Advertising, Marketing, and Promotion Costs Advertising production costs are expensed the first time the advertisement is run. All other costs of advertising, marketing, and promotion are expensed as incurred. These expenses of $109,738, $111,162, $21,158 and $86,510 for the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014 and year ended December 31, 2013, respectively, are included in SG&A expense in the consolidated statements of comprehensive income (loss). Included in prepaid and other current assets at March 31, 2016 and March 31, 2015 were $1,084 and $1,899, respectively, related to prepaid advertising, marketing, and promotion expenses for programs to take place after such dates. Rent Expense Rent expense is recorded using the straight-line method to account for scheduled rental increases or rent holidays. Lease incentives for tenant improvement allowances are recorded as reductions of rent expense over the lease term. The rental payments under some of the Company's retail store leases are based on a minimum rental plus a percentage of the store's sales in excess of stipulated amounts. Rent expenses are included in SG&A expenses in the consolidated statements of comprehensive income (loss). Retirement Plan The Company provides a 401(k) defined contribution plan that eligible US employees may elect to participate in through tax-deferred contributions. The Company matches 50% of each eligible participant's tax-deferred contributions on up to 6% of eligible compensation on a per payroll period basis, with a true-up contribution if such eligible participant is employed by the Company on the last day of the calendar year. Internationally, the Company has various defined contribution plans. Certain international locations require mandatory contributions under social programs, and the Company contributes at least the statutory minimums. US 401(k) matching contributions totaled $2,182, $1,726, $601 and $1,386 during the years ended March 31, 2016 and 2015, quarter ended March 31, 2014, and the year ended December 31, 2013, respectively, and was included in SG&A expenses in the consolidated statements of comprehensive income (loss). In addition, the Company may also make discretionary profit sharing contributions to the plan. However, the Company did not make any profit sharing contributions for the years ended March 31, 2016 and 2015, quarter ended March 31, 2014, and the year ended December 31, 2013. Derivative Instruments and Hedging Activities The Company transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency risk. The Company may enter into foreign currency forward or option contracts, generally with maturities of 15 months or less, to reduce the volatility of cash flows primarily related to forecasted revenue denominated in certain foreign currencies. In addition, the Company utilizes foreign currency exchange contracts and other derivative instruments to mitigate foreign currency exchange rate risk associated with foreign currency-denominated assets and liabilities, primarily intercompany balances. The Company does not use foreign currency contracts for trading purposes. Certain of the Company's foreign currency forward contracts are designated cash flow hedges of forecasted sales and are subject to foreign currency exposures. These contracts allow the Company to sell Euros, British Pounds and Yen in exchange for US dollars at specified contract rates. Forward contracts are used to hedge forecasted sales over specific quarters. Changes in the fair value of these forward contracts designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) within stockholders' equity, and are recognized in the consolidated statements of comprehensive income (loss) during the period which approximates the time the corresponding third-party sales occur. The Company may also enter into foreign exchange contracts that are not designated as hedging instruments for financial accounting purposes. These contracts are generally entered into to offset the gains and losses on certain intercompany balances until the expected time of repayment. Accordingly, any gains or losses resulting from changes in the fair value of the non-designated contracts are reported in SG&A expenses in the consolidated statements of comprehensive income (loss). The gains and losses on these contracts generally offset the gains and losses associated with the underlying foreign currency-denominated balances, which are also reported in SG&A expenses. Refer to Note 9 for the impact of derivative instruments and hedging activities on the Company's consolidated financial statements. The Company records the assets or liabilities associated with derivative instruments and hedging activities at fair value based on Level 2 inputs in other current assets or other current liabilities, respectively, in the consolidated balance sheets. The Level 2 inputs consist of forward spot rates at the end of the reporting period. The accounting for gains and losses resulting from changes in fair value depends on the use of the derivative and whether it is designated and qualifies for hedge accounting. For all hedging relationships, the Company formally documents the hedging relationship and its risk management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company factors the nonperformance risk of the Company and the counterparty into the fair value measurements of its derivatives. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. The Company assesses hedge effectiveness and measures hedge ineffectiveness at least quarterly. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported in other comprehensive income (loss) (OCI) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring, or management determines to remove the designation of the cash flow hedge. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is probable that a forecasted transaction will not occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in OCI related to the hedging relationship. Foreign Currency Translation The Company considers the US dollar as its functional currency. The Company has certain wholly-owned foreign subsidiaries with functional currencies other than the US dollar. In most cases, the Company's foreign subsidiaries' local currency is the same as the designated functional currency. The Company holds a portion of its cash and other monetary assets and liabilities in currencies other than its subsidiary's functional currency, and is exposed to financial statement transaction gains and losses as a result of remeasuring the financial positions held in US dollars and foreign currencies into the functional currency of subsidiaries that are non-US dollar functional. The Company remeasures these monetary assets and liabilities using the exchange rate at the end of the reporting period, which results in gains and losses that are included in SG&A expenses in the consolidated statements of comprehensive income (loss) as incurred, except for gains and losses arising on intercompany foreign currency transactions that are of a long-term investment nature. In addition, the Company translates assets and liabilities of subsidiaries with reporting currencies other than US dollars into US dollars using the exchange rates at of the end of the reporting period, which results in financial statement translation gains and losses in OCI. Comprehensive Income (Loss) Comprehensive income (loss) is the total of net earnings and all other non-owner changes in equity. Except for net income (loss), foreign currency translation adjustments, and unrealized gains and losses on cash flow hedges, the Company does not have any transactions or other economic events that qualify as comprehensive income (loss). Net Income (Loss) per Share Basic net income (loss) per share represents net income (loss) divided by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share represents net income (loss) divided by the weighted-average number of shares outstanding, including the dilutive impact of potential issuances of common stock. For the years ended March 31, 2016 and 2015, quarter ended March 31, 2014 and year ended December 31, 2013, the difference between the weighted-average number of basic and diluted common shares resulted from the dilutive impact of nonvested stock units (NSUs), restricted stock units (RSUs), restricted stock awards (RSAs), stock appreciation rights (SARs) and options to purchase common stock. The reconciliations of basic to diluted weighted-average common shares outstanding were as follows:
*For the years ended March 31, 2016, March 31, 2015 and December 31, 2013, the share-based awards that were excluded from the dilutive effect were excluded because the necessary conditions had not been satisfied for the shares to be issuable based on the Company's performance. For the quarter ended March 31, 2014, the Company excluded all NSUs, RSUs, RSAs and SARs from the diluted net loss per share computation because they were antidilutive due to the net loss during the period. At March 31, 2016, the excluded RSUs include the maximum amount of the 2015 and 2016 Long-Term Incentive Plan (LTIP) Awards. At March 31, 2015, the excluded RSUs included the maximum amount of the 2012, 2013 and 2015 LTIP Awards. At March 31, 2014 and December 31, 2013, the excluded RSUs included the maximum amount of the Level III, 2012 and 2013 LTIP Awards. Refer to Note 8 for further information related to the LTIP awards. Use of Estimates The preparation of the Company's consolidated financial statements in accordance with United States generally accepted accounting principles (US GAAP) requires management to make estimates and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Management bases these estimates and assumptions upon historical experience, existing and known circumstances, authoritative accounting pronouncements and other factors that management believes to be reasonable. Significant areas requiring the use of management estimates relate to inventory write-downs, accounts receivable allowances, returns liabilities, stock compensation, performance based compensation, impairment assessments, depreciation and amortization, income tax liabilities, uncertain tax positions and income taxes receivable, the fair value of financial instruments, and fair values of acquired intangibles, assets and liabilities, including estimated contingent consideration payments. Actual results could differ materially from these estimates. Recent Accounting Pronouncements On May 28, 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in US GAAP when it becomes effective. The standard permits the use of either the retrospective or cumulative effect transition method. On August 12, 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers, which provides for a one year deferral of the effective date of ASU No. 2014-09, as well as early application, which will be effective for the Company on April 1, 2018. In March 2016, the FASB issued ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies how to apply the implementation guidance related to principal versus agent considerations within ASU No. 2014-09. The Company is evaluating the effect that all of the ASUs related to Revenue from Contracts with Customers will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting. The adoption of the new revenue standard is not expected to have a material impact on the Company's consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, which requires an entity to present debt issuance costs on the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Prior to the issuance of the standard, debt issuance costs were required to be presented in the balance sheet as a deferred charge (i.e., an asset). This ASU is effective for the Company on April 1, 2016, with early adoption permitted. On August 18, 2015, the FASB issued ASU No. 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, which allows an entity to continue to present debt issuance costs related to line of credit arrangements as deferred charges. The adoption of ASU No. 2015-03 and ASU No. 2015-15 will not have a material impact on the Company’s consolidated financial statements or related disclosures. In April 2015, the FASB issued ASU No. 2015-05, Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, which clarifies whether a cloud computing arrangement should be treated as a software license or a service contract. Customers that have a cloud computing arrangement that includes a software license are required to account for the software license element of the arrangement consistent with the acquisition of other software licenses. Customers that have a cloud computing arrangement that does not include a software license are required to account for the arrangement as a service contract. This ASU is effective for the Company on April 1, 2016, with early adoption permitted. The adoption of ASU No. 2015-05 is not expected to have a material impact on the Company’s consolidated financial statements or related disclosures. In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory, which changed the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. Current US GAAP requires, at each financial statement date, that entities measure inventory at the lower of cost or market, most commonly the current replacement cost. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company is evaluating the effect that ASU No. 2015-11 will have on its consolidated financial statements and related disclosures, but believes it will not have a material impact. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes, which requires that an entity classify deferred tax assets and liabilities as noncurrent on the balance sheet. Prior to the issuance of the standard, deferred tax assets and liabilities were required to be separated into current and noncurrent amounts on the basis of the classification of the related asset or liability. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company has prospectively adopted this ASU beginning with the period ending March 31, 2016 in its Annual Report on Form 10-K. The adoption of ASU No. 2015-17 did not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases, to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new standard requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. A lessee should recognize in the Balance Sheet a liability to make lease payments (the lease liability) at fair value and an offsetting right-of-use asset representing its right to use the underlying asset for the lease term. When measuring assets and liabilities arising from a lease, a lessee (and a lessor) should include payments to be made in optional periods only if the lessee is reasonably certain to exercise an option to extend the lease or not to exercise an option to terminate the lease. Similarly, optional payments to purchase the underlying asset should be included in the measurement of lease assets and lease liabilities only if the lessee is reasonably certain to exercise that purchase option. This ASU is effective for the Company on April 1, 2019. The Company is evaluating the effect that the ASU will have on its consolidated financial statements and related disclosures. Since the Company utilizes operating leases for most of its facilities and retail stores, it is anticipated that adoption of the ASU will have a material impact on its balance sheet presentation. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which requires that an entity recognize excess tax benefits and certain tax deficiencies of employee share-based payment awards in the income statement instead of in additional paid-in-capital when the awards vest or are settled and present excess tax benefits as an operating activity on the statement of cash flows instead of as a financing activity. This ASU also allows entities to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting and to make a policy election to either estimate the number of awards that are expected to vest or to account for forfeitures as they occur. In addition, the cash paid by an entity to a tax authority when shares are withheld to satisfy its statutory income tax withholding obligation is required to be classified as a financing activity on its statement of cash flows. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company is evaluating the impact of the adoption of ASU No. 2016-09 on the Company’s consolidated financial statements and related disclosures. |
Restructuring |
12 Months Ended |
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Mar. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In February 2016, the Company announced the implementation of a retail store fleet optimization and office consolidation that was intended to streamline brand operations, reduce overhead costs, create operating efficiencies and improve collaboration and included the closure of facilities and relocation of employees. The Company has begun to realign its brands across two groups: Fashion Lifestyle and Performance Lifestyle. The Fashion Lifestyle group will include the UGG and Koolaburra brands. The Performance Lifestyle group will include the Teva, Sanuk and Hoka brands. As part of this realignment, the Company also relocated its Sanuk brand operations in Irvine, California to the corporate headquarters in Goleta, California. In addition, the Company closed its Ahnu brand operations office in Richmond, California. Furthermore, the Company is in the process of evaluating its portfolio of retail stores. The Company has identified 24 retail stores that are candidates for potential closure. Subsequent to the sales of the MOZO and TSUBO brands, neither of which were material, the operating results for its other brands only include Hoka, Ahnu and Koolaburra. The Company plans to leverage elements, including particular styles, of the Ahnu brand under the umbrella of the Teva brand beginning in calendar year 2017. As a result of the retail store fleet optimization, office consolidation and software impairments, the Company has incurred charges totaling approximately $25,000 at March 31, 2016. Of this amount, $9,000 is related to early lease termination costs, $4,000 is related to severance costs to be paid to employees, $6,000 is related to impairment of leasehold improvements and various assets, $4,000 is related to various Business Transformation Project (BT) supply chain software impairments, and $2,000 for termination of various contracts. Of the total amount, approximately $15,000 was accrued at March 31, 2016, and expected to be paid in 2017. Approximately $2,000 of the charges were recognized in cost of sales and the remainder were recorded in selling, general and administrative expenses. The segment impacts of the total restructuring charges are as follows: Sanuk brand wholesale charges of approximately $3,000, other brands wholesale charges of approximately $2,500 related to the Ahnu brand, DTC charges of approximately $10,500, and the remainder of approximately $9,000 to unallocated overhead costs, primarily BT supply chain software impairments and European office consolidation. It is anticipated that the Company will incur an additional $10,000 to $15,000 of similar restructuring costs in the fiscal year ending March 31, 2017. |
Property and Equipment |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment | Property and Equipment Property and equipment is summarized as follows:
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Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Most of the Company's goodwill is related to the Sanuk reportable segment, with the remaining related to the UGG and other brands reportable segments. The Company's goodwill and other intangible assets are summarized as follows:
There were no changes in the Company's goodwill during the fiscal years ended March 31, 2016 and March 31, 2015.
At December 31, 2015 and 2014, the Company performed its annual impairment tests and evaluated its UGG and other brands' goodwill. At October 31, 2015 and 2014, the Company performed its annual impairment tests and evaluated its Sanuk goodwill and Teva trademarks. Based on the carrying amounts of the UGG, Teva, Sanuk, and other brands' goodwill, trademarks, and net assets, the brands' fiscal year 2016 and 2015 sales and operating results, and the brands' long-term forecasts of sales and operating results as of their evaluation dates, the Company concluded that the carrying amounts of the UGG, Sanuk and other brands' goodwill, as well as the Teva trademarks, were not impaired. We performed a quantitative analysis of the Sanuk reporting unit's fair value at October 31, 2015, and concluded that it was not impaired with a significant excess compared to its carrying value. The Sanuk brand goodwill was evaluated based on qualitative analysis at October 31, 2014. At December 31, 2015 and 2014, and at October 31, 2015 and 2014, all goodwill other than the Sanuk brand goodwill and all other nonamortizable intangibles were evaluated based on qualitative analyses. The Company's goodwill by segment is as follows:
The Company’s other intangible assets are summarized as follows:
Aggregate amortization expense for amortizable intangible assets for the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014 and year ended December 31, 2013, was $8,850, $11,291, $1,886 and $7,975, respectively. The following table summarizes the expected amortization expense on existing intangible assets, excluding indefinite-lived intangible assets of $7,843 and trademarks of $15,455, for the next five years:
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes Income Tax Expense Components of income tax expense (benefit) are as follows:
Foreign income (loss) before income taxes was $105,938, $95,850, $(3,631) and $60,851 during the years ended March 31, 2016, March 31, 2015, during the quarter ended March 31, 2014 and during the year ended December 31, 2013, respectively. Income Tax Expense Reconciliation Income tax expense differed from that obtained by applying the statutory federal income tax rate to income before income taxes as follows:
Deferred Taxes The Company has early adopted ASU 2015-17 prospectively. As a result, deferred taxes are presented as noncurrent at March 31, 2016 and the tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are presented as follows:
In order to fully realize the deferred tax assets, the Company will need to generate future taxable income of approximately $62,000. The deferred tax assets are primarily related to the Company's domestic operations and are expected to be realized between fiscal years 2017and 2019. The change in net deferred tax assets between March 31, 2016 and March 31, 2015 includes approximately $300 attributable to OCI. Domestic income before income taxes for the years ended March 31, 2016 and March 31, 2015, the quarter ended March 31, 2014 and the year ended December 31, 2013 was $50,947, $125,289, $2,889 and $144,706, respectively. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net deferred tax assets and, accordingly, no valuation allowance was recorded in fiscal years 2016 and 2015. Tax Impact of Foreign Earnings At March 31, 2016, the Company has not provided deferred taxes on approximately $454,000 of undistributed earnings from non-US subsidiaries where the earnings are considered to be permanently reinvested. Management’s intent is to continue to reinvest these earnings to support the strategic priority for growth in international markets. If management decides at a later date to repatriate these funds to the US, the Company would be required to provide taxes on these amounts based on applicable US tax rates, net of foreign taxes already paid. The Company has not determined the deferred tax liability associated with these undistributed earnings and, as such, determining our tax liability upon repatriation is not practicable. At March 31, 2016, the Company had approximately $233,000 of cash and cash equivalents outside the US. For fiscal year 2016, the Company generated approximately 23.0% of its pre-tax earnings from a country which does not impose a corporate income tax. Unrecognized Tax Benefits When tax returns are filed, some positions taken are subject to uncertainty about the merits of the position taken or the amount that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which the Company believes it is more likely than not that the position will be sustained upon examination. Tax positions that meet the more likely than not recognition threshold are measured as the largest amount of tax benefit that is more than 50% likely to be realized upon settlement. The portion of the benefits that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the accompanying consolidated balance sheets, along with any associated interest and penalties that would be payable to the taxing authorities upon examination. A reconciliation of the beginning and ending amounts of total unrecognized tax benefits is as follows:
The amount of accrued unrecognized tax benefits, net of federal benefit that, if recognized, would affect the effective tax rate at March 31, 2016 was $3,996. The accrual relates to tax positions taken in years that are open to examination. At March 31, 2016, interest and potential penalties of $1,842 were accrued in the consolidated balance sheet resulting from tax positions that are subject to examination and were recorded in interest expense on the Company’s consolidated statements of comprehensive income (loss). At March 31, 2015, interest and potential penalties of $1,246 were accrued in the consolidated balance sheet resulting from tax positions that are subject to examination. It is reasonably possible that approximately $856 of unrecognized tax benefits will be settled within the next 12 months. The Company files income tax returns in the US federal jurisdiction and various state, local, and foreign jurisdictions. With few exceptions, the Company is no longer subject to US federal, state, local, or non-US income tax examinations by tax authorities for years before 2011. Although the Company believes its tax estimates are reasonable and prepares its tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audits, and any related litigation, could be materially different from the Company's estimates or from its historical income tax provisions and accruals. The results of an audit or litigation could have a material effect on operating results or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, or interest assessments. The Company has on-going income tax examinations in various state and foreign tax jurisdictions. It is the opinion of management that these audits and inquiries will not have a material impact on the Company's consolidated financial statements. |
Notes Payable and Long-Term Debt |
12 Months Ended |
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Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Notes Payable and Long-Term Debt | Notes Payable and Long-Term Debt Domestic Line of Credit. In August 2011, the Company entered into a Credit Agreement (Credit Agreement), which was amended and restated in August 2012 (Amended and Restated Credit Agreement) and amended in its entirety in November 2014 (Second Amended and Restated Credit Agreement). The Second Amended and Restated Credit Agreement entered into with JPMorgan Chase Bank, National Association (JPMorgan) as the administrative Agent, Comerica and HSBC as co-syndication agents, and the party lenders thereto, is a five-year, $400,000 secured revolving credit facility that contains a $75,000 sublimit for the issuance of letters of credit and a $5,000 sublimit for swingline loans, and matures on November 13, 2019. Subject to customary conditions and the approval of any lender whose commitment would be increased, the Company has the option to increase the maximum principal amount available under the Second Amended and Restated Credit Agreement by up to an additional $200,000, resulting in a maximum available principal amount of $600,000. None of the lenders under the Second Amended and Restated Credit Agreement has committed at this time or is obligated to provide any such increase in the commitments. In addition to allowing borrowings in US dollars, the Second Amended and Restated Credit Agreement provides a $150,000 sublimit for borrowings in Euros, British pounds and any other currency that is subsequently approved by JPMorgan, each lender and the issuing bank. At the Company's option, revolving loans issued under the Second Amended and Restated Credit Agreement will initially bear interest at either the adjusted London Interbank Offered Rate (LIBOR) for 30 days (0.44% at March 31, 2016) plus 1.25% per annum, in the case of LIBOR borrowings, or at the alternate base rate plus 0.25% per annum, and thereafter the interest rate will fluctuate between adjusted LIBOR plus 1.25% per annum and adjusted LIBOR plus 2.00% per annum (or between the alternate base rate plus 0.25% per annum and the alternate base rate plus 1.00% per annum), based upon the Company's total adjusted leverage ratio at such time. In addition, the Company will initially be required to pay fees of 0.175% per annum on the daily amount of the revolving credit facility, and thereafter the fee rate will fluctuate between 0.175% and 0.30% per annum, based upon the Company's total adjusted leverage ratio. The Company's obligations under the Second Amended and Restated Credit Agreement are guaranteed by the Company's existing and future wholly-owned domestic subsidiaries (other than certain immaterial subsidiaries, foreign subsidiaries, foreign subsidiary holding companies and specified excluded subsidiaries) (the Guarantors), and is secured by a first-priority security interest in substantially all of the assets of the Company and the Guarantors, including all or a portion of the equity interests of certain of the Company's domestic and first-tier foreign subsidiaries. The Second Amended and Restated Credit Agreement contains financial covenants which include: the total adjusted leverage ratio must not be greater than 3.25 to 1.00; the sum of the consolidated annual earnings before interest, taxes, depreciation, and amortization (EBITDA) and annual rental expense, divided by the sum of the annual interest expense and the annual rental expense must be greater than 2.25 to 1.00 on a pro forma basis; and other customary limitations. The Second Amended and Restated Credit Agreement contains certain other covenants which include: the maximum amount paid for capital expenditures may not exceed $110,000 per year if the total adjusted leverage ratio is equal to or exceeds 2.75 to 1.00; the maximum additional unsecured debt may not exceed $200,000; the Company may not have aggregate ERISA events that are considered materially adverse; the Company may not have a change of control (as defined in the Second Amended and Restated Credit Agreement); and no restrictions on dividends, share repurchases or acquisitions may be made if the total adjusted leverage ratio does not exceed 2.75 to 1.00 on a pro forma basis. In August 2015, the Company entered into Amendment 1 to the Second Amended and Restated Credit Agreement to add certain foreign subsidiaries as borrowers. During the year ended March 31, 2016, the Company borrowed $426,000 and repaid $373,000. At March 31, 2016, the Company had outstanding borrowings of $53,000 under the Second Amended and Restated Credit Agreement, as amended and had outstanding letters of credit of approximately $700. As a result, the unused balance under the Second Amended and Restated Credit Agreement, as amended was approximately $346,300 at March 31, 2016. At March 31, 2016, the Company had a remaining balance of approximately $1,300 in deferred financing costs related to the Amended and Restated Credit Agreement of August 2012 and Second Amended and Restated Agreement of November 2014 included in prepaid expenses. This amount is being amortized over the term of the Second Amended and Restated Credit Agreement using the straight-line method. At March 31, 2016, the Company was in compliance with all financial covenants. Subsequent to March 31, 2016, the Company borrowed $76,000 and repaid $16,000 resulting in a total outstanding balance of $113,000 under the Second Amended and Restated Credit Agreement, at May 31, 2016. China Line of Credit. In August 2013, Deckers (Beijing) Trading Co., LTD, a fully owned subsidiary, entered into a credit facility in China (China Credit Facility) that provides for an uncommitted revolving line of credit of up to CNY 60,000, or approximately $10,000, in the quarters ending September 30 and December 31 and CNY 20,000, or approximately $3,300, in the quarters ending March 31 and June 30. The China Credit Facility is payable on demand and subject to annual review and renewal. The obligations under the China Credit Facility are guaranteed by the Company for 110% of the facility amount in USD. In December 2013, the China Credit Facility was revised to provide for the uncommitted revolving line of credit of up to CNY 60,000 to be extended to the entire year. In October 2014, the China Credit Facility was amended (Amended China Credit Facility) to include, among other things, an extension of the aggregate period of borrowing from 12 months to 18 months. In October 2015, the Amended China Credit Facility was amended (Second Amended China Credit Facility) to include an increase in the uncommitted revolving line of credit of up to CNY 150,000, or approximately $23,000, including a sublimit of CNY 50,000, or approximately $8,000, for the Company's fully owned subsidiary, Deckers Footwear (Shanghai) Co., LTD. During the year ended March 31, 2016, the Company borrowed approximately $23,200 and repaid $14,100 under the Second Amended China Credit Facility for total outstanding borrowings of approximately $14,000 under the Second Amended China Credit Facility at March 31, 2016. Interest is based on the People’s Bank of China rate, which was 4.35% at March 31, 2016. Subsequent to March 31, 2016, the Company repaid $4,800 resulting in a total outstanding balance of $9,200 under the Second Amended China Credit Facility at May 31, 2016. Japan Line of Credit. In March 2016, Deckers Japan, G.K., a fully owned subsidiary, entered into a credit facility in Japan (Japan Credit Facility) that provides for an uncommitted bilateral revolving line of credit of up to JPY 5,500,000, or approximately $49,000, for a maximum term of six months. The Japan Credit Facility renews annually, and it is guaranteed by the Company. Interest is based on the Tokyo Interbank Offered Rate (TIBOR) for three months plus 0.40%. At March 31, 2016, TIBOR for three months was 0.10% and the effective interest rate was 0.50%. The Japan Credit Facility has customary covenants including not having losses for two consecutive years, maintaining an interest coverage ratio of greater than one and maintaining higher assets than liabilities. At March 31, 2016, the Company had no borrowings under the Japan Credit Facility. Mortgage. In July 2014, the Company obtained a mortgage secured by its corporate headquarters property for approximately $33,900. At March 31, 2016, the outstanding balance under the mortgage was approximately $33,200, which includes approximately $600 in short-term borrowings and approximately $32,600 in mortgage payable in the consolidated balance sheet. The mortgage has a fixed interest rate of 4.928%. Payments include interest and principal in an amount that amortizes the principal balance over a 30-year period; however, the loan will mature and have a balloon payment due on July 1, 2029 of approximately $23,400. Minimum principal payments over the next 5 years are approximately $2,900. In December 2014, the mortgage financial covenants were amended to be consistent with the financial covenants of the Second Amended and Restated Credit Agreement as discussed above. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Lease Commitments. The Company leases office, distribution and retail facilities, and automobiles, under operating lease agreements which continue in effect through 2028. Some of the leases contain renewal options of anywhere from one to fifteen years. Since the terms of these arrangements meet the accounting definition of operating lease arrangements, the aggregate sum of future minimum lease payments is not reflected on the consolidated balance sheets. Future minimum commitments under the lease agreements are as follows:
The following schedule shows the composition of total rental expense:
Purchase Obligations. The Company had $957,887 of outstanding purchase orders with its manufacturers at March 31, 2016. In addition, the Company entered into agreements for the build-out of new retail stores, promotional activities and other services. Future commitments under these purchase orders and other agreements for the year ending March 31, 2017 total $915,465. Included in the fiscal year 2017 amount are remaining commitments, net of deposits, that are also unconditional purchase obligations relating to sheepskin contracts. The Company enters into contracts requiring purchase commitments of sheepskin that its affiliates, manufacturers, factories, and other agents (each or collectively, a Buyer) must make on or before a specified target date. Under certain supplier contracts, the Company pays an advance deposit that is repaid to the Company as a Buyer purchases goods under the terms of these agreements. Included in other current assets on the consolidated balance sheets are approximately $20,000 and $14,000 of advance deposits at March 31, 2016 and March 31, 2015, respectively. In the event that a Buyer does not purchase certain minimum commitments on or before certain target dates, the supplier may retain a portion of the advance deposit until the amounts of the commitments are fulfilled. These agreements may result in unconditional purchase obligations if a Buyer does not meet the minimum purchase requirements. In the event that a Buyer does not purchase such minimum commitments by the target dates, the Company would be responsible for compliance with any and all minimum purchase commitments under these contracts, and the Company would make additional deposit payments towards the purchase of the remaining minimum commitments and such additional deposits would be returned as the Buyer purchases the remaining minimum commitments. The contracts do not permit net settlement. Minimum commitments for these contracts at March 31, 2016 were as follows:
Litigation. The Company is currently involved in various legal claims arising in the ordinary course of business. Management does not believe that the disposition of these matters, whether individually or in the aggregate, will have a material effect on the Company’s financial position or results of operations. Contingent Consideration. The purchase price for the Sanuk brand, acquired in July 2011, included contingent consideration payments. The final contingent consideration payment of approximately $19,700, which is 40.0% of the Sanuk brand's gross profit in calendar year 2015, was paid subsequent to March 31, 2016. The purchase price for the Hoka brand, acquired in September 2012, includes contingent consideration through calendar year 2017, with a maximum of $2,000, of which approximately $1,700 has been paid. The maximum of $2,000 was achieved during the fiscal year ended March 31, 2016. At March 31, 2016, the final contingent consideration payment of approximately $300 is pending final disbursement. At March 31, 2016, contingent consideration for both brands is included in other accrued expenses in the consolidated balance sheets. Future Capital Commitments. At March 31, 2016, the Company had approximately $14,000 of material commitments for future capital expenditures primarily related to the acquisition of land adjacent to its corporate headquarters, completed in April 2016, and tenant improvements for retail store space in the US and Asia. Indemnification. The Company has agreed to indemnify certain of its licensees, distributors, and promotional partners in connection with claims related to the use of the Company's intellectual property. The terms of such agreements range up to 5 years initially and generally do not provide for a limitation on the maximum potential future payments. From time to time, the Company also agrees to indemnify its licensees, distributors and promotional partners in connection with claims that the Company’s products infringe the intellectual property rights of third parties. These agreements may or may not be made pursuant to a written contract. In addition, from time to time, the Company also agrees to standard indemnification provisions in commercial agreements in the ordinary course of business. Management believes the likelihood of any payments under any of these arrangements is remote and would be immaterial. This determination was made based on a prior history of insignificant claims and related payments. There are no currently pending claims relating to indemnification matters involving the Company's intellectual property. |
Stockholders' Equity |
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Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity | Stockholders' Equity Equity Incentive Plans In May 2006, the Company adopted the 2006 Equity Incentive Plan (the 2006 Plan), which was amended on May 9, 2007. In September 2015, the Company's stockholders approved the 2015 Stock Incentive Plan (2015 SIP), which replaced the Company's 2006 Plan. As with the 2006 Plan, the primary purpose of the 2015 SIP is to encourage ownership in the Company by key personnel, whose long-term service is considered essential to the Company’s continued success. The 2015 SIP reserves 1,275,000 shares of the Company’s common stock for issuance to employees, directors, consultants, independent contractors and advisors, plus any additional shares that are forfeited, or are otherwise terminated under the 2006 Plan. The maximum aggregate number of shares that may be issued to employees under the 2015 SIP through the exercise of incentive stock options is 750,000. Nonvested Stock Unit Grants. The Company has elected to grant NSUs annually to key personnel. The NSUs granted entitle the employee recipients to receive shares of common stock of the Company upon vesting. The vesting of most NSUs is subject to achievement of certain performance targets, with the remaining NSUs subject only to time-based vesting restrictions. For the majority of NSUs granted in 2013 and after, the performance-based NSUs vest in equal one-third installments at the end of each of the three years after the performance goals are achieved, and the time-based NSUs vest in equal annual installments over a three-year period following the date of grant. Long-Term Incentive Plans. In May 2007, the Company adopted long-term incentive award agreements under the 2006 Plan for issuance of SARs and RSUs, which were awarded to certain executive officers of the Company. These awards vest subject to certain long-term performance objectives and certain long-term service conditions. One-half of the SAR and RSU awards vested 80% on December 31, 2010 and 20% on December 31, 2011. The other half of the SAR and RSU awards vested 80% on December 31, 2015 and, provided that the conditions are met, 20% will vest on December 31, 2016. The Company considers achievement of the remaining performance conditions as probable and is recognizing such compensation cost over the service period. 2013 LTIP Awards. In December 2013, the Board of the Company adopted long-term incentive awards (2013 LTIP Awards) under the 2006 Plan. The shares under these awards were available for issuance to current and future members of the Company's management team, including the Company's named executive officers. Each recipient received a specified maximum number of RSUs, each of which represented the right to receive one share of the Company's common stock. These awards were to vest subject to certain long-term performance objectives and certain long-term service conditions. At March 31, 2016, the Company did not meet the threshold performance criteria and the awards did not vest. 2015 LTIP Awards. In September 2014, the Board of the Company approved long-term incentive awards (2015 LTIP Awards) under the 2006 Plan. The shares under these awards were available for issuance to current and future members of the Company's leadership team, including the Company's named executive officers. Each recipient received a specified maximum number of RSUs, each of which represents the right to receive one share of the Company's common stock. These awards vest subject to certain long-term performance objectives and certain long-term service conditions. The awards will vest on March 31, 2017 only if the Company meets certain revenue targets ranging between approximately $2,155,000 and approximately $2,447,000 and certain EBITDA targets ranging between approximately $336,000 and approximately $394,000 for the fiscal year ending March 31, 2017. No vesting of any 2015 LTIP Awards will occur if either of the threshold performance criteria is not met for the year ending March 31, 2017. To the extent financial performance is achieved above the threshold levels, the number of RSUs that will vest will increase up to the maximum number of units granted under the award. Under this award program, the Company granted awards that contain a maximum amount of approximately 160,000 RSUs during the year ended March 31, 2015. The average grant date fair value of these RSUs was $98.29 per share. At March 31, 2016, the Company believed that the achievement of at least the threshold performance objectives was remote. During the year ended March 31, 2016, the Company reversed approximately $1,400 of compensation expense previously recognized. If the performance objectives become probable, the Company will then begin recording an expense for the 2015 LTIP Awards and would recognize a cumulative catch-up adjustment in the period they become probable. At March 31, 2016, the cumulative amount would be approximately $6,000 based on the maximum number of units if the performance objectives were probable. 2016 LTIP Awards. In November 2015, the Board approved long-term incentive awards (2016 LTIP Awards) under the 2015 SIP. The shares under these awards will be available for issuance to current and future members of the Company's leadership team, including the Company's named executive officers. Each recipient will receive a specified maximum number of restricted stock units (RSUs), each of which will represent the right to receive one share of the Company's common stock. The awards will vest on March 31, 2018 only if the Company meets certain revenue targets and certain consolidated EBITDA targets for the fiscal year ending March 31, 2018. To the extent financial performance is achieved above the threshold levels for each of these performance criteria, the number of RSUs that will vest will increase up to a maximum of 200% of the targeted amount for that award. No vesting of any portion of the 2016 LTIP Awards will occur if the Company fails to achieve revenue and EBITDA amounts equal to at least 90% of either threshold amounts for these criteria. Following the determination of the Company’s achievement with respect to the revenue and EBITDA criteria for the performance period, the vesting of each 2016 LTIP Award will be subject to adjustment based on the application of a total stockholder return (TSR) modifier. The amount of the adjustment will be determined based on a comparison of the Company's TSR relative to the TSR of a pre-determined set of peer group companies for the 36-month performance period commencing on April 1, 2015 and ending on March 31, 2018. A Monte-Carlo simulation model, which is a generally accepted statistical technique, was used to determine the grant date fair value by simulating a range of possible future stock prices for the Company and each member of the peer group over the TSR 36-month performance period. Under this award program, the Company granted awards covering a maximum of approximately 308,000 RSUs during the year ended March 31, 2016. The average grant date fair value of these RSUs was $50.05 per share. Based on the Company's current long-range forecast, the Company believed that the achievement of at least the threshold performance objectives of these awards was remote, and therefore has not recognized compensation expense for the fiscal year ended March 31, 2016. If the performance objectives become probable, the Company will then begin recording an expense for the 2016 LTIP Awards and would recognize a cumulative catch-up adjustment in the period they become probable. At March 31, 2016, the cumulative amount would be approximately $2,000 based on the maximum number of units if the performance objectives were probable. Grants to Directors On a quarterly basis, the Company grants shares of its common stock to each of its outside directors. The fair value of such shares, which is determined based on the closing price at the date of issuance, is expensed on the date of issuance. Employee Stock Purchase Plan In September 2015, the Company's stockholders approved the 2015 Employee Stock Purchase Plan (2015 ESPP). The primary purpose of the 2015 ESPP is to enhance the Company’s ability to attract and retain the services of eligible employees and provide additional incentives to eligible employees to devote their effort and skill to the Company’s advancement by providing them an opportunity to participate in the ownership of the Company’s stock. The 2015 ESPP provides for the initial authorization of 1,000,000 shares of the Company’s common stock. Eligible employees commenced participation in the 2015 ESPP in March 2016 with payroll deductions. Each consecutive purchase period will be 6 months in duration and shares will be purchased on the last trading day of the purchase period at a price that reflects a 15% discount to the closing price. Stock Repurchase Programs In June 2012, the Company approved a stock repurchase program to repurchase up to $200,000 of the Company's common stock in the open market or in privately negotiated transactions, subject to market conditions, applicable legal requirements, and other factors. The program did not obligate the Company to acquire any particular amount of common stock and the program may have been suspended at any time at the Company's discretion. At February 28, 2015, the Company had repurchased approximately 3,823,000 shares under this program at an average price of $52.31 per share for approximately $200,000. At February 28, 2015, the Company had repurchased the full amount authorized under this program. In January 2015, the Company approved a new stock repurchase program to repurchase up to $200,000 of the Company's common stock, which included the same stipulations as the purchase program approved in June 2012, as described above. Under the new program, during the year ended March 31, 2016, the Company repurchased approximately 1,420,000 shares for $94,200, or an average price of $66.32 per share. Through March 31, 2016, the Company had repurchased a total of approximately 1,797,000 shares under this program for approximately $122,100, or an average price of $67.95 per share, leaving the remaining approved amount at approximately $77,900. Stock Compensation The table below summarizes stock compensation amounts recognized in the consolidated statements of comprehensive income (loss):
The table below summarizes the total remaining unrecognized compensation cost related to nonvested awards that the Company considers are probable to vest and the weighted-average period over which the cost is expected to be recognized at March 31, 2016:
The unrecognized compensation cost excludes a maximum of $9,657 and $13,950 of compensation cost on the 2015 LTIP Awards and 2016 LTIP Awards, respectively. Achievement of the performance conditions are not considered probable. Nonvested Stock Units Issued Under the 2006 Plan and the 2015 SIP The table below summarizes the 2006 Plan and the 2015 SIP activity:
*Nonvested Stock Units cancelled during the period represent awards granted with respect to which performance criteria were not met. Stock Appreciation Rights Issued Under the 2006 Plan No stock appreciation rights have been issued under the 2015 SIP. The table below summarizes stock appreciation rights activity under the 2006 Plan:
The maximum contractual term is 10 and 15 years from the date of grant for those SARs with final vesting dates of December 31, 2011 and December 31, 2016, respectively. The number of SARs expected to vest is based on the probability of achieving certain performance conditions and is also reduced by estimated forfeitures. Restricted Stock Units Issued Under the 2006 Plan and the 2015 SIP The table below summarizes the restricted stock unit activity under the 2006 Plan and 2015 SIP:
*Nonvested Stock Units cancelled during the period represent awards granted with respect to which performance criteria were not met. The amounts granted are the maximum amounts under the respective awards. |
Foreign Currency Exchange Contracts and Hedging |
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Foreign Currency Exchange Contracts and Hedging | Foreign Currency Exchange Contracts and Hedging At March 31, 2016, the Company had foreign currency exchange contracts designated as cash-flow hedges with notional amounts totaling approximately $105,000 held by seven counterparties, which will mature at various dates over the next 12 months. At March 31, 2015, the Company had foreign currency exchange contracts designated as cash flow hedges with notional amounts totaling approximately $46,000, held by four counterparties. During the year ended March 31, 2016, the Company settled foreign currency exchange contracts designated as cash flow hedges with notional amounts totaling approximately $46,000 that were entered into in the prior fiscal year and approximately $32,000 that were entered in fiscal year 2016. The Company also entered into, and settled, non-designated derivative contracts with total notional amounts of approximately $261,000. The nonperformance risk of the Company and the counterparties did not have a material impact on the fair value of the derivatives. During the year ended March 31, 2016, the hedges remained effective. The effective portion of the gain or loss on the derivative is reported in OCI and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. At March 31, 2016, the total amount in accumulated OCI (refer to Note 11) is expected to be reclassified into income within the next 15 months. The following table summarizes the effect of foreign currency exchange contracts designated as cash flow hedging relationships:
The following table summarizes the effect of foreign currency exchange contracts not designated as hedging instruments:
Subsequent to March 31, 2016, the Company entered into non-designated derivative contracts with notional amounts totaling approximately $63,000, which are expected to mature over the next three months, and designated derivative contracts with notional amounts totaling approximately $11,000, which are expected to mature over the next 12 months. All hedging contracts held at May 31, 2016 were held by a total of seven counterparties. |
Transition Period |
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Transition Period [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transition Period | Transition Period In February 2014, the Company's Board of Directors approved a change in the Company's fiscal year end from December 31 to March 31. Accordingly, the Company is presenting audited financial statements for the quarter transition period ended March 31, 2014. The following table provides certain unaudited comparative financial information for the same period of the prior year.
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Accumulated Other Comprehensive Loss |
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Accumulated balances of the components within accumulated other comprehensive loss are as follows:
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Business Segments |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Segments | Business Segments The Company's accounting policies of the segments below are the same as those described in the summary of significant accounting policies (refer to Note 1), except that the Company does not allocate corporate overhead costs or non-operating income and expenses to segments. The Company evaluates segment performance primarily based on net sales and income (loss) from operations. During the first quarter of fiscal year 2016, the Company changed its reportable operating segments to combine the previously separated E-Commerce and retail store operating components into one DTC reportable operating segment. After the reorganization, the Company has five reportable operating segments including the strategic business units for the worldwide wholesale operations of the UGG brand, Teva brand, Sanuk brand, other brands, and the DTC business. During the first quarter of fiscal year 2016, the Company’s other brands included Hoka One One® (Hoka), Ahnu®, Koolaburra® by UGG, TSUBO® and MOZO®. The wholesale operations of each brand are managed separately because each requires different marketing, research and development, design, sourcing, and sales strategies. The income (loss) from operations for each of the segments includes only those costs which are specifically related to each segment, which consist primarily of cost of sales, costs for research and development, design, sales and marketing, depreciation, amortization, and the costs of employees and their respective expenses that are directly related to each business segment. The unallocated corporate overhead costs include: costs of the distribution centers, certain executive and stock compensation, accounting and finance, legal, information technology, human resources, and facilities costs, among others. For the year ended March 31, 2015, the quarter ended (transition period) March 31, 2014 and the year ended December 31, 2013, certain reclassifications were made to conform to the current period presentation. These changes in segment reporting only changed the presentation within the below table and did not impact the Company's consolidated financial statements for any period. The segment information for prior periods has been adjusted retrospectively to conform to the current period presentation. Refer to Note 1 “The Company and Summary of Significant Accounting Policies”, Note 2 "Restructuring" and Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further disclosure and discussion of the change in segment reporting. The Company converted three of its retail stores in China to partner retail stores during the year ended March 31, 2016 and seven during the year ended March 31, 2015. Upon conversion, each of these stores became wholly-owned and operated by third-parties in China. Sales made to the partner retail stores are included in the UGG brand wholesale segment and not included in the DTC segment as of the date of conversion. Business segment information is summarized as follows:
Inter-segment sales from the Company’s wholesale segments to the Company’s DTC segment are at the Company’s cost, and there is no inter-segment profit on these inter-segment sales. Income (loss) from operations of the wholesale segments does not include any inter-segment gross profit from sales to the DTC segment. The assets allocable to each segment include accounts receivable, inventory, fixed assets, goodwill, other intangible assets, and certain other assets that are specifically identifiable with one of the Company's segments. Unallocated assets are the assets not specifically related to the segments and include cash and cash equivalents, deferred tax assets, and various other assets shared by the Company's segments. Reconciliations of total assets from reportable segments to the consolidated balance sheets are as follows:
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Concentration of Business, Significant Customers and Credit Risk |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Risks and Uncertainties [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Concentration of Business, Significant Customers and Credit Risk | Concentration of Business, Significant Customers and Credit Risk The Company does not consider international operations a separate segment, as management reviews such operations in the aggregate with the aforementioned segments. Long-lived assets, which consist of property and equipment, in the US and all other countries combined were as follows:
*No other country's long-lived assets comprised more than 10% of total long-lived assets at March 31, 2016 and March 31, 2015. The Company sells its products to customers throughout the US and to foreign customers located in Europe, Asia, Canada, Australia, and Latin America, among other regions. Approximately $526,000, or 28.1%, and approximately $519,000, or 28.6%, of total net sales were denominated in foreign currencies for the years ended March 31, 2016 and 2015, respectively. International sales were 35.0%, 35.9%, 32.7% and 33.0%, of the Company's total net sales for the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014, and the year ended December 31, 2013, respectively. For the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014, and the year ended December 31, 2013, no single foreign country comprised more than 10% of total sales. Management performs regular evaluations concerning the ability of its customers to satisfy their obligations and records a provision for doubtful accounts based upon these evaluations. The Company's five largest customers accounted for approximately 21.9% of worldwide net sales for the year ended March 31, 2016 compared to 22.2% for the year ended March 31, 2015. No single customer accounted for more than 10% of net sales in the years ended March 31, 2016 and March 31, 2015, quarter ended March 31, 2014, and the year ended December 31, 2013. At March 31, 2016 and March 31, 2015, the Company had one customer representing 12.8% and 11.0% of net trade accounts receivable, respectively. At March 31, 2015, the Company had a second customer representing 11.8% of net trade accounts receivable. The Company's production is concentrated at a limited number of independent manufacturing factories in Asia. Sheepskin is the principal raw material for certain UGG products and the majority of sheepskin is purchased from two tanneries in China and is sourced primarily from Australia and the UK. The Company began using a new raw material, UGGpureTM, wool woven into a durable backing, in many of the Company's UGG products in 2013 and which the Company currently purchases from one supplier. The other production materials used by the Company are sourced primarily in Asia. The Company's operations are subject to the customary risks of doing business abroad, including, but not limited to, currency fluctuations, customs duties and related fees, various import controls and other nontariff barriers, restrictions on the transfer of funds, labor unrest and strikes and, in certain parts of the world, political instability. The supply of sheepskin can be adversely impacted by weather conditions, disease, and harvesting decisions that are completely outside the Company's control. Furthermore, the price of sheepskin is impacted by demand, industry, and competitors. A portion of the Company's cash and cash equivalents is held as cash in operating accounts with third-party financial institutions. These balances, at times exceed the Federal Deposit Insurance Corporation (FDIC) insurance limits. While the Company regularly monitors the cash balances in its operating accounts and adjusts the balances as appropriate, these cash balances could be impacted if the underlying financial institutions fail or are subject to other adverse conditions in the financial markets. The remainder of the Company's cash equivalents is invested in interest-bearing funds managed by third-party investment management institutions. These investments can include US treasury bonds and securities, money market funds, and municipal bonds, among other investments. Certain of these investments are subject to general credit, liquidity, market, and interest rate risks. Investment risk has been and may further be exacerbated by US mortgage defaults, credit and liquidity issues, and sovereign debt concerns in Europe, which have affected various sectors of the financial markets. At March 31, 2016, the Company had experienced no loss or lack of access to cash in its operating accounts, invested cash and cash equivalents. The Company's cash and cash equivalents are as follows:
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Quarterly Summary of Information (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Summary of Information (Unaudited) | Quarterly Summary of Information (Unaudited) Summarized unaudited quarterly financial data are as follows:
*Includes restructuring charges of approximately $25,000. Refer to Note 2 for further information.
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Schedule II VALUATION AND QUALIFYING ACCOUNTS |
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Valuation and Qualifying Accounts [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule II VALUATION AND QUALIFYING ACCOUNTS |
See accompanying report of independent registered public accounting firm. |
The Company and Summary of Significant Accounting Policies (Policies) |
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Mar. 31, 2016 | |||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||
Company and Basis of Presentation | The Company and Basis of Presentation The consolidated financial statements include the accounts of Deckers Outdoor Corporation and its wholly-owned subsidiaries (collectively referred to as the "Company"). Accordingly, all references herein to Deckers Outdoor Corporation or "Deckers" include the consolidated results of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Deckers Outdoor Corporation is a global leader in designing, marketing and distributing innovative footwear, apparel and accessories developed for both everyday casual lifestyle use and high performance activities. The Company's business is seasonal, with the highest percentage of UGG® brand net sales occurring in the quarters ending September 30 and December 31 and the highest percentage of Teva® and Sanuk® brand net sales occurring in the quarters ending March 31 and June 30 of each year. The Company sells its products through quality domestic retailers and international distributors and retailers, as well as directly to end-user consumers through the Direct-to-Consumer (DTC) reporting segment. Independent third parties manufacture all of the Company's products. In July 2014, the Company acquired its UGG brand distributor that sold to retailers in Germany and continues to operate as a wholesale business in Germany through the newly acquired subsidiary. The acquisition included certain intangible and tangible assets and the assumption of liabilities. The purchase price of the acquisition was not material to the Company’s consolidated financial statements. In April 2015, the Company acquired inventory and certain intangible assets, including the trade name related to the Koolaburra® brand, a sheepskin and wool based footwear brand. The purchase price of the acquisition was not material to the Company's consolidated financial statements. In July 2015, the Company sold certain tangible and intangible assets, including approximately $1,500 of inventory, and the trade name related to the MOZO® brand, a footwear brand crafted for culinary professionals. In February 2016, the Company sold certain tangible and intangible assets, including the trade name related to the TSUBO brand, a line of mid and high-end dress and dress casual footwear. The impacts of these sales were not material to the Company's consolidated financial statements. Change in Fiscal Year In February 2014, the Company's Board of Directors (the Board) approved a change in its fiscal year end from December 31 to March 31. The change was intended to better align the Company's planning, financial and reporting functions with the seasonality of the business. The 2016, 2015 and 2013 fiscal years are for the periods ended March 31, 2016, March 31, 2015 and December 31, 2013, respectively. The transition period was the quarter ended March 31, 2014 to coincide with the change in the Company's fiscal year end. |
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Business Segment Reporting | Business Segment Reporting During the first quarter of fiscal year 2016, the Company changed its reportable operating segments to combine the previously separated retail store and E-Commerce operating components into one DTC reportable operating segment. The Company now has five reportable operating segments including the strategic business units for the worldwide wholesale operations of the UGG brand, Teva brand, Sanuk brand, other brands, and the DTC business and it is by these segments that information is reported to the Chief Operating Decision Maker (CODM). The CODM is the Principal Executive Officer. The Company performs an annual analysis of the appropriateness of its reportable segments. |
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Cash Equivalents | Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. |
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Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company provides an allowance against trade accounts receivable for estimated losses that may result from customers' inability to pay. The Company determines the amount of the allowance by analyzing known uncollectible accounts, aged trade accounts receivables, economic conditions and forecasts, historical experience and the customers' credit-worthiness. Trade accounts receivable that are subsequently determined to be uncollectible are charged or written off against this allowance. Write-offs against this allowance are recorded in selling, general and administrative (SG&A) expense in the consolidated statements of comprehensive income (loss). The allowance includes specific allowances for trade accounts, all or a portion of which are identified as potentially uncollectible, plus a non-specific allowance for the balance of accounts based on the Company's historical loss experience. Allowances have been established for all projected losses of this nature. |
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Inventories | Inventories Inventories, principally finished goods, are stated at the lower of cost (first-in, first-out) or market (net realizable value). Cost includes initial molds and tooling that are amortized over the life of the mold in cost of sales in the consolidated statements of comprehensive income (loss). Cost also includes shipping and handling fees and costs, which are subsequently expensed to cost of sales. Market values are determined by historical experience with discounted sales, industry trends and the retail environment. |
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Property and Equipment, Depreciation and Amortization | Property and Equipment, Depreciation and Amortization Property and equipment has a useful life expectancy of at least one year. Property and equipment includes tangible, non-consumable items owned by the Company valued at or above $3, certain computer software costs and internal or external computer system consulting work valued at or above $3 as defined below, and portable electronic devices valued at or above $1.5. Tangible, non-consumable items below these amounts are expensed. The value includes the purchase price, sales tax and costs to acquire (shipping and handling), install (excluding site preparation costs), secure and prepare the item for its intended use. Depreciation of property and equipment is calculated using the straight-line method based on estimated useful lives. Capitalized website costs, which are included in the machinery and equipment category, are immaterial to the Company's consolidated financial statements. Leasehold improvements are amortized to their residual value, if any, on the straight-line basis over their estimated economic useful lives or the lease term, whichever is shorter. The Company allocates depreciation and amortization of property, plant, and equipment to cost of sales and SG&A expenses in the consolidated statements of comprehensive income (loss). The majority of the Company's depreciation and amortization is included in SG&A expenses in the consolidated statements of comprehensive income (loss) due to the nature of its operations. Most of the Company's depreciation and amortization is from its warehouses, its corporate headquarters and its retail stores. The Company outsources all manufacturing; therefore, the amount allocated to cost of sales is not material. |
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Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Intangible assets consist primarily of goodwill, trademarks, customer and distributor relationships, patents, lease rights, and non-compete agreements arising from the application of purchase accounting. Intangible assets with estimable useful lives are amortized and reviewed for impairment. Goodwill and intangible assets with indefinite useful lives are not amortized, but are tested for impairment at least annually, at December 31, except for the Teva trademarks and Sanuk goodwill, which are tested at October 31. The assessment of goodwill impairment involves valuing the Company's reporting units that carry goodwill. Currently, the Company's reporting units are the same as the Company's operating segments. The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The Company does not calculate the fair value of the reporting unit unless the Company determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. If the Company determines this, then the first quantitative step is a comparison of the fair value of the reporting unit with its carrying amount. If the fair value exceeds the carrying amount, goodwill is not impaired. If the fair value of the reporting unit is below the carrying amount, then a second step is performed to measure the amount of the impairment, if any. The test for impairment involves the use of estimates related to the fair values of the business operations with which goodwill is associated and the fair values of the intangible assets with indefinite lives. The Company also evaluates the fair values of other intangible assets with indefinite useful lives in relation to their carrying values. The Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative assessment of the indefinite life intangible asset. The Company does not calculate the fair value of the indefinite life intangible unless the Company determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. If the Company concludes that it is more likely than not that its fair value is less than its carrying amount, then the Company compares the fair value of the indefinite life intangible to its carrying amount, and if the fair value of the indefinite life intangible exceeds its carrying amount, no impairment charge will be recognized. If the fair value of the indefinite life intangible is less than the carrying amount, the Company will record an impairment charge to write-down the intangible asset to its fair value. Impairment and amortization are recorded in SG&A expenses in the consolidated statements of comprehensive income (loss). Determining fair value of goodwill and other intangible assets is highly subjective and requires the use of estimates and assumptions. The Company uses estimates including future revenues, royalty rates, discount rates, attrition rates, and market multiples, among others. The Company also considers the following factors:
In addition, facts and circumstances could change, including further deterioration of general economic conditions or the retail environment, customers reducing orders in response to such conditions, and increased competition. These or other factors could result in changes to the calculation of fair value which could result in impairment of the Company's remaining goodwill and other intangible assets. Changes in any one or more of these estimates and assumptions could produce different financial results. |
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Accounting for Long-Lived Assets | Accounting for Long-Lived Assets Other long-lived assets, such as machinery and equipment, internal use software, leasehold improvements, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount exceeds the estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount exceeds the fair value of the asset. Intangible assets subject to amortization are amortized over their respective estimated useful lives to their estimated residual values, if any. The Company uses the straight-line method for depreciation and amortization of long-lived assets, except for certain intangible assets where the Company can reliably determine the pattern in which the economic benefits of the assets will be consumed. At least quarterly, the Company evaluates whether any impairment triggering events, including the following, have occurred which would require such asset groups to be tested for impairment:
When an impairment triggering event has occurred, the Company tests for recoverability of the asset group's carrying value using estimates of undiscounted future cash flows based on the existing service potential of the applicable asset group. In determining the service potential of a long-lived asset group, the Company considers its remaining useful life, cash-flow generating capacity, and physical output capacity. These estimates include the undiscounted cash flows associated with future expenditures necessary to maintain the existing service potential. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. The Company assesses potential impairment of its retail group long-lived assets by comparing projected 12 months store cash flows to the current carrying value of the store's long-lived assets. Stores that have been opened for more than one year, or have otherwise been identified by management as having one or more indicators of impairment, with projected 12 months cash flows less than the current carrying amount of the store's long-lived assets are then reviewed to determine if an impairment exists. An impairment loss, if any, would only reduce the carrying amount of long-lived assets in the group based on the fair value of the group assets. Impairment is recorded in SG&A expenses in the consolidated statements of comprehensive income (loss). |
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Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in the consolidated statements of comprehensive income (loss) in the period that includes the enactment date. The Company recognizes the effect of income tax positions in the financial statements only if those positions are more likely than not of being sustained upon examination. Recognized income tax positions are measured at the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company accounts for interest and penalties accrued for income tax contingencies as interest expense in the consolidated statements of comprehensive income (loss). |
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Fair Value Measurements | Fair Value Measurements The fair values of the Company's cash and cash equivalents, trade accounts receivable, prepaid expenses, income taxes receivable, other current assets, short-term borrowings, trade accounts payable, accrued payroll, other accrued expenses, income taxes payable and value added tax payable approximate the carrying values due to the relatively short maturities of these instruments. The fair values of the Company's long-term liabilities, other than contingent consideration, recalculated using current interest rates, would not significantly differ from the carrying values. The fair value of the contingent consideration related to acquisitions and of the Company's derivatives are measured and recorded at fair value on a recurring basis. Changes in fair value of contingent consideration resulting from either accretion or changes in discount rates or in the expectations of achieving the performance targets are recorded in SG&A expenses. The Company records the fair value of assets or liabilities associated with derivative instruments and hedging activities in other current assets or other accrued expenses, respectively, in the consolidated balance sheets. The inputs used in measuring fair value are prioritized into the following hierarchy:
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Nonqualified Deferred Compensation | Nonqualified Deferred Compensation In 2010, the Company established a nonqualified deferred compensation program that permits a select group of management employees to defer earnings to a future date on a nonqualified basis. For each plan year, on behalf of the Company, the Company's Board may, but is not required to, contribute any amount it desires to any participant under this program. The Company's contribution will be determined by the Board annually. In March 2015, the Board approved a contribution for calendar year 2016 and gave the authority to management to approve the payment. At March 31, 2016, no payment was pending. The value of the deferred compensation is recognized based on the fair value of the participants' accounts. The Company has established a rabbi trust for the purpose of supporting the benefits payable under this program, with the assets invested in company-owned life insurance (COLI) policies. |
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Stock Compensation | Stock Compensation All of the Company's stock compensation awards are classified within stockholders' equity. Stock compensation cost is measured at the grant date based on the value of the award and is expensed ratably over the service period. The Company recognizes expense only for those awards that management deems probable of achieving the performance and service objectives. Determining the fair value and related expense of share-based awards requires judgment, including estimating the percentage of awards that will be forfeited and probabilities of meeting the awards' performance criteria. If actual forfeitures differ significantly from the estimates or if probabilities change during a period, stock compensation expense and the Company's results of operations could be materially impacted. Stock compensation expense is included in SG&A expense in the consolidated statements of comprehensive income (loss). |
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Revenue Recognition | Revenue Recognition The Company recognizes wholesale, E-Commerce, and international distributor revenue when products are shipped and retail revenue at the point of sale. All sales are recognized when the customer takes title and assumes risk of loss, collection of the related receivable is reasonably assured, persuasive evidence of an arrangement exists, and the sales price is fixed or determinable. For wholesale and international distributor sales, allowances for estimated returns, discounts, chargebacks, and bad debts are provided for when related revenue is recorded. For E-Commerce sales, allowances for estimated returns and bad debts are provided for when related revenue is recorded. For retail sales, allowances for estimated returns are provided for when related revenue is recorded. Amounts billed for shipping and handling costs are recorded as a component of net sales, while the related costs paid to third-party shipping companies are recorded as a cost of sales. The Company presents revenue net of taxes collected from customers and remitted to governmental authorities. |
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Research and Development Costs | Research and Development Costs All research and development costs are expensed as incurred. |
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Advertising, Marketing, and Promotion Costs | Advertising, Marketing, and Promotion Costs Advertising production costs are expensed the first time the advertisement is run. All other costs of advertising, marketing, and promotion are expensed as incurred. |
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Rent Expense | Rent Expense Rent expense is recorded using the straight-line method to account for scheduled rental increases or rent holidays. Lease incentives for tenant improvement allowances are recorded as reductions of rent expense over the lease term. The rental payments under some of the Company's retail store leases are based on a minimum rental plus a percentage of the store's sales in excess of stipulated amounts. Rent expenses are included in SG&A expenses in the consolidated statements of comprehensive income (loss). |
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Retirement Plan | Retirement Plan The Company provides a 401(k) defined contribution plan that eligible US employees may elect to participate in through tax-deferred contributions. The Company matches 50% of each eligible participant's tax-deferred contributions on up to 6% of eligible compensation on a per payroll period basis, with a true-up contribution if such eligible participant is employed by the Company on the last day of the calendar year. Internationally, the Company has various defined contribution plans. Certain international locations require mandatory contributions under social programs, and the Company contributes at least the statutory minimums. |
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Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency risk. The Company may enter into foreign currency forward or option contracts, generally with maturities of 15 months or less, to reduce the volatility of cash flows primarily related to forecasted revenue denominated in certain foreign currencies. In addition, the Company utilizes foreign currency exchange contracts and other derivative instruments to mitigate foreign currency exchange rate risk associated with foreign currency-denominated assets and liabilities, primarily intercompany balances. The Company does not use foreign currency contracts for trading purposes. Certain of the Company's foreign currency forward contracts are designated cash flow hedges of forecasted sales and are subject to foreign currency exposures. These contracts allow the Company to sell Euros, British Pounds and Yen in exchange for US dollars at specified contract rates. Forward contracts are used to hedge forecasted sales over specific quarters. Changes in the fair value of these forward contracts designated as cash flow hedges are recorded as a component of accumulated other comprehensive income (loss) within stockholders' equity, and are recognized in the consolidated statements of comprehensive income (loss) during the period which approximates the time the corresponding third-party sales occur. The Company may also enter into foreign exchange contracts that are not designated as hedging instruments for financial accounting purposes. These contracts are generally entered into to offset the gains and losses on certain intercompany balances until the expected time of repayment. Accordingly, any gains or losses resulting from changes in the fair value of the non-designated contracts are reported in SG&A expenses in the consolidated statements of comprehensive income (loss). The gains and losses on these contracts generally offset the gains and losses associated with the underlying foreign currency-denominated balances, which are also reported in SG&A expenses. Refer to Note 9 for the impact of derivative instruments and hedging activities on the Company's consolidated financial statements. The Company records the assets or liabilities associated with derivative instruments and hedging activities at fair value based on Level 2 inputs in other current assets or other current liabilities, respectively, in the consolidated balance sheets. The Level 2 inputs consist of forward spot rates at the end of the reporting period. The accounting for gains and losses resulting from changes in fair value depends on the use of the derivative and whether it is designated and qualifies for hedge accounting. For all hedging relationships, the Company formally documents the hedging relationship and its risk management objective and strategy for undertaking the hedge, the hedging instrument, the hedged transaction, the nature of the risk being hedged, how the hedging instrument's effectiveness in offsetting the hedged risk will be assessed prospectively and retrospectively, and a description of the method used to measure ineffectiveness. The Company factors the nonperformance risk of the Company and the counterparty into the fair value measurements of its derivatives. The Company also formally assesses, both at the inception of the hedging relationship and on an ongoing basis, whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in cash flows of hedged transactions. The Company assesses hedge effectiveness and measures hedge ineffectiveness at least quarterly. For derivative instruments that are designated and qualify as part of a cash flow hedging relationship, the effective portion of the gain or loss on the derivative is reported in other comprehensive income (loss) (OCI) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The Company discontinues hedge accounting prospectively when it determines that the derivative is no longer effective in offsetting cash flows attributable to the hedged risk, the derivative expires or is sold, terminated, or exercised, the cash flow hedge is de-designated because a forecasted transaction is not probable of occurring, or management determines to remove the designation of the cash flow hedge. In all situations in which hedge accounting is discontinued and the derivative remains outstanding, the Company continues to carry the derivative at its fair value on the balance sheet and recognizes any subsequent changes in its fair value in earnings. When it is probable that a forecasted transaction will not occur, the Company discontinues hedge accounting and recognizes immediately in earnings gains and losses that were accumulated in OCI related to the hedging relationship. |
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Foreign Currency Translation | Foreign Currency Translation The Company considers the US dollar as its functional currency. The Company has certain wholly-owned foreign subsidiaries with functional currencies other than the US dollar. In most cases, the Company's foreign subsidiaries' local currency is the same as the designated functional currency. The Company holds a portion of its cash and other monetary assets and liabilities in currencies other than its subsidiary's functional currency, and is exposed to financial statement transaction gains and losses as a result of remeasuring the financial positions held in US dollars and foreign currencies into the functional currency of subsidiaries that are non-US dollar functional. The Company remeasures these monetary assets and liabilities using the exchange rate at the end of the reporting period, which results in gains and losses that are included in SG&A expenses in the consolidated statements of comprehensive income (loss) as incurred, except for gains and losses arising on intercompany foreign currency transactions that are of a long-term investment nature. In addition, the Company translates assets and liabilities of subsidiaries with reporting currencies other than US dollars into US dollars using the exchange rates at of the end of the reporting period, which results in financial statement translation gains and losses in OCI. |
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Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) is the total of net earnings and all other non-owner changes in equity. Except for net income (loss), foreign currency translation adjustments, and unrealized gains and losses on cash flow hedges, the Company does not have any transactions or other economic events that qualify as comprehensive income (loss). |
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Net Income (Loss) per Share | Net Income (Loss) per Share Basic net income (loss) per share represents net income (loss) divided by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share represents net income (loss) divided by the weighted-average number of shares outstanding, including the dilutive impact of potential issuances of common stock. |
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Use of Estimates | Use of Estimates The preparation of the Company's consolidated financial statements in accordance with United States generally accepted accounting principles (US GAAP) requires management to make estimates and assumptions that affect the amounts reported in these consolidated financial statements and accompanying notes. Management bases these estimates and assumptions upon historical experience, existing and known circumstances, authoritative accounting pronouncements and other factors that management believes to be reasonable. Significant areas requiring the use of management estimates relate to inventory write-downs, accounts receivable allowances, returns liabilities, stock compensation, performance based compensation, impairment assessments, depreciation and amortization, income tax liabilities, uncertain tax positions and income taxes receivable, the fair value of financial instruments, and fair values of acquired intangibles, assets and liabilities, including estimated contingent consideration payments. Actual results could differ materially from these estimates. |
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New Accounting Pronouncements | Recent Accounting Pronouncements On May 28, 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in US GAAP when it becomes effective. The standard permits the use of either the retrospective or cumulative effect transition method. On August 12, 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers, which provides for a one year deferral of the effective date of ASU No. 2014-09, as well as early application, which will be effective for the Company on April 1, 2018. In March 2016, the FASB issued ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which clarifies how to apply the implementation guidance related to principal versus agent considerations within ASU No. 2014-09. The Company is evaluating the effect that all of the ASUs related to Revenue from Contracts with Customers will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting. The adoption of the new revenue standard is not expected to have a material impact on the Company's consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, Simplifying the Presentation of Debt Issuance Costs, which requires an entity to present debt issuance costs on the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Prior to the issuance of the standard, debt issuance costs were required to be presented in the balance sheet as a deferred charge (i.e., an asset). This ASU is effective for the Company on April 1, 2016, with early adoption permitted. On August 18, 2015, the FASB issued ASU No. 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, which allows an entity to continue to present debt issuance costs related to line of credit arrangements as deferred charges. The adoption of ASU No. 2015-03 and ASU No. 2015-15 will not have a material impact on the Company’s consolidated financial statements or related disclosures. In April 2015, the FASB issued ASU No. 2015-05, Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, which clarifies whether a cloud computing arrangement should be treated as a software license or a service contract. Customers that have a cloud computing arrangement that includes a software license are required to account for the software license element of the arrangement consistent with the acquisition of other software licenses. Customers that have a cloud computing arrangement that does not include a software license are required to account for the arrangement as a service contract. This ASU is effective for the Company on April 1, 2016, with early adoption permitted. The adoption of ASU No. 2015-05 is not expected to have a material impact on the Company’s consolidated financial statements or related disclosures. In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory, which changed the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. Current US GAAP requires, at each financial statement date, that entities measure inventory at the lower of cost or market, most commonly the current replacement cost. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company is evaluating the effect that ASU No. 2015-11 will have on its consolidated financial statements and related disclosures, but believes it will not have a material impact. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes, which requires that an entity classify deferred tax assets and liabilities as noncurrent on the balance sheet. Prior to the issuance of the standard, deferred tax assets and liabilities were required to be separated into current and noncurrent amounts on the basis of the classification of the related asset or liability. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company has prospectively adopted this ASU beginning with the period ending March 31, 2016 in its Annual Report on Form 10-K. The adoption of ASU No. 2015-17 did not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases, to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new standard requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous GAAP. A lessee should recognize in the Balance Sheet a liability to make lease payments (the lease liability) at fair value and an offsetting right-of-use asset representing its right to use the underlying asset for the lease term. When measuring assets and liabilities arising from a lease, a lessee (and a lessor) should include payments to be made in optional periods only if the lessee is reasonably certain to exercise an option to extend the lease or not to exercise an option to terminate the lease. Similarly, optional payments to purchase the underlying asset should be included in the measurement of lease assets and lease liabilities only if the lessee is reasonably certain to exercise that purchase option. This ASU is effective for the Company on April 1, 2019. The Company is evaluating the effect that the ASU will have on its consolidated financial statements and related disclosures. Since the Company utilizes operating leases for most of its facilities and retail stores, it is anticipated that adoption of the ASU will have a material impact on its balance sheet presentation. In March 2016, the FASB issued ASU No. 2016-09, Improvements to Employee Share-Based Payment Accounting, which requires that an entity recognize excess tax benefits and certain tax deficiencies of employee share-based payment awards in the income statement instead of in additional paid-in-capital when the awards vest or are settled and present excess tax benefits as an operating activity on the statement of cash flows instead of as a financing activity. This ASU also allows entities to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting and to make a policy election to either estimate the number of awards that are expected to vest or to account for forfeitures as they occur. In addition, the cash paid by an entity to a tax authority when shares are withheld to satisfy its statutory income tax withholding obligation is required to be classified as a financing activity on its statement of cash flows. This ASU is effective for the Company on April 1, 2017, with early adoption permitted. The Company is evaluating the impact of the adoption of ASU No. 2016-09 on the Company’s consolidated financial statements and related disclosures. |
The Company and Summary of Significant Accounting Policies (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Company's financial assets and liabilities measured on a recurring basis at fair value | . The assets and liabilities that are measured on a recurring basis at fair value are summarized as follows:
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Schedule of reconciliation of beginning and ending amounts related to the fair value for contingent consideration for acquisition of business, categorized as Level 3 | The following table presents a reconciliation of the Level 3 measurement (rounded):
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Schedule of reconciliations of basic to diluted weighted-average common shares outstanding | The reconciliations of basic to diluted weighted-average common shares outstanding were as follows:
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Property and Equipment (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of property and equipment | Property and equipment is summarized as follows:
|
Goodwill and Other Intangible Assets (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of goodwill and other intangible assets | The Company's goodwill and other intangible assets are summarized as follows:
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Schedule of changes in goodwill | There were no changes in the Company's goodwill during the fiscal years ended March 31, 2016 and March 31, 2015.
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Schedule of total goodwill by segment | The Company's goodwill by segment is as follows:
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Schedule of finite-lived intangible assets | The Company’s other intangible assets are summarized as follows:
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Schedule of expected amortization expense on existing intangible assets | The following table summarizes the expected amortization expense on existing intangible assets, excluding indefinite-lived intangible assets of $7,843 and trademarks of $15,455, for the next five years:
|
Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of income taxes | Components of income tax expense (benefit) are as follows:
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Actual income taxes differed from that obtained by applying the statutory federal income tax rate to income before income taxes | Income tax expense differed from that obtained by applying the statutory federal income tax rate to income before income taxes as follows:
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Tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities | As a result, deferred taxes are presented as noncurrent at March 31, 2016 and the tax effects of temporary differences that give rise to significant portions of deferred tax assets and deferred tax liabilities are presented as follows:
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Reconciliation of the beginning and ending amounts of total unrecognized tax benefits | A reconciliation of the beginning and ending amounts of total unrecognized tax benefits is as follows:
|
Commitments and Contingencies (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of future minimum commitments under the operating lease agreements | Future minimum commitments under the lease agreements are as follows:
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Component of total rental expense | The following schedule shows the composition of total rental expense:
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Schedule of future commitments under purchase orders and other agreements | Minimum commitments for these contracts at March 31, 2016 were as follows:
|
Stockholders' Equity (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of stock compensation amounts recognized in the consolidated statements of comprehensive income | The table below summarizes stock compensation amounts recognized in the consolidated statements of comprehensive income (loss):
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Summary of the total remaining unrecognized compensation cost related to nonvested awards, that are considered probable of vesting and the weighted-average period over which the cost is expected to be recognized | The table below summarizes the total remaining unrecognized compensation cost related to nonvested awards that the Company considers are probable to vest and the weighted-average period over which the cost is expected to be recognized at March 31, 2016:
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Summary of Nonvested Stock Units | The table below summarizes the 2006 Plan and the 2015 SIP activity:
*Nonvested Stock Units cancelled during the period represent awards granted with respect to which performance criteria were not met. |
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Summary of Stock Appreciation Rights Issued Under the 2006 Plan | The table below summarizes stock appreciation rights activity under the 2006 Plan:
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Summary of Restricted Stock Units Issued | The table below summarizes the restricted stock unit activity under the 2006 Plan and 2015 SIP:
*Nonvested Stock Units cancelled during the period represent awards granted with respect to which performance criteria were not met. |
Foreign Currency Exchange Contracts and Hedging (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||
Schedule of location and amount of gains and losses related to derivatives designated as hedging instruments reported in consolidated financial statements | The following table summarizes the effect of foreign currency exchange contracts designated as cash flow hedging relationships:
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Schedule of location and amount of gains and losses related to derivatives not designated as hedging instruments reported in consolidated financial statements | The following table summarizes the effect of foreign currency exchange contracts not designated as hedging instruments:
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Transition Period (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transition Period [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Transition period statement of income | The following table provides certain unaudited comparative financial information for the same period of the prior year.
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Accumulated Other Comprehensive Loss (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Components of accumulated other comprehensive income | Accumulated balances of the components within accumulated other comprehensive loss are as follows:
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Business Segments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of business segments information | Business segment information is summarized as follows:
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Schedule of reconciliations of total assets from reportable segments to the condensed consolidated balance sheets | Reconciliations of total assets from reportable segments to the consolidated balance sheets are as follows:
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Concentration of Business, Significant Customers and Credit Risk (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2016 | |||||||||||||||||||||||||||||||||||||||||||||||||
Risks and Uncertainties [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of long-lived assets, which consist of property and equipment, by major country | Long-lived assets, which consist of property and equipment, in the US and all other countries combined were as follows:
*No other country's long-lived assets comprised more than 10% of total long-lived assets at March 31, 2016 and March 31, 2015. |
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Schedule of the Company's cash and cash equivalents | The Company's cash and cash equivalents are as follows:
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Quarterly Summary of Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of unaudited quarterly financial data | Summarized unaudited quarterly financial data are as follows:
*Includes restructuring charges of approximately $25,000. Refer to Note 2 for further information.
|
The Company and Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands |
1 Months Ended | 3 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Jul. 31, 2015
USD ($)
|
Jun. 30, 2015
segment
|
Mar. 31, 2016
USD ($)
segment
|
Mar. 31, 2015
USD ($)
segment
|
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Proceeds from Sale of Productive Assets | $ 1,500 | |||
Number of Reportable Segments | segment | 1 | 5 | 5 | |
Money market fund accounts | $ 195,575 | $ 127,900 | ||
Valuation of Long-lived Assets, Cash Flow Determination Period | 12 months | |||
Maximum Maturity Period of Foreign Currency Forward or Option Contracts | 15 months |
The Company and Summary of Significant Accounting Policies - Property Plant Equipment (Details) |
12 Months Ended |
---|---|
Mar. 31, 2016
USD ($)
| |
Minimum | |
Property and equipment | |
Useful life | 1 year |
Tangibles, Non-consumable Equipment | |
Property and equipment | |
Property, Plant and Equipment, Threshold, Value | $ 3,000 |
Computer Software and Computer Related Consulting Costs | |
Property and equipment | |
Property, Plant and Equipment, Threshold, Value | 3,000 |
Portable Electronic Devices | |
Property and equipment | |
Property, Plant and Equipment, Threshold, Value | $ 1,500 |
The Company and Summary of Significant Accounting Policies - Stock Based Compensation (Details) - USD ($) $ in Thousands |
Mar. 31, 2016 |
Mar. 31, 2015 |
---|---|---|
Other Current Liabilities | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Deferred Compensation Liability, Current and Noncurrent | $ 308 | $ 540 |
Other Noncurrent Liabilities | ||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | ||
Deferred Compensation Liability, Classified, Noncurrent | $ 5,993 | $ 5,041 |
The Company and Summary of Significant Accounting Policies- Advertising and Research and Development (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Accounting Policies [Abstract] | ||||
Research and Development Expense | $ 4,486 | $ 22,176 | $ 20,872 | $ 19,257 |
Marketing and Advertising Expense | $ 21,158 | 109,738 | 111,162 | $ 86,510 |
Prepaid Advertising | $ 1,084 | $ 1,899 |
The Company and Summary of Significant Accounting Policies - Retirement Plans (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Defined Contribution Plan, Employer Matching Contribution, Percent of Match | 50.00% | |||
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay | 6.00% | |||
Defined Contribution Plan, Cost Recognized | $ 601 | $ 2,182 | $ 1,726 | $ 1,386 |
Goodwill and Other Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Finite-lived Intangible Assets [Roll Forward] | ||||
Intangible assets, net, beginning balance | $ 87,743 | |||
Purchase of intangible assets | 3,197 | |||
Amortization expense | $ (1,886) | (8,850) | $ (11,291) | $ (7,975) |
Changes in foreign currency exchange rates | 936 | |||
Intangible assets, net, ending balance | $ 83,026 | $ 87,743 |
Goodwill and Other Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Goodwill | ||||
Total goodwill | $ 127,934 | $ 127,934 | $ 127,934 | |
Amortization expense | $ 1,886 | 8,850 | 11,291 | $ 7,975 |
Indefinite-lived intangible assets | 7,843 | |||
Trademarks | 15,455 | 15,455 | ||
Expected amortization expense on existing intangible assets | ||||
2017 | 8,191 | |||
2018 | 8,078 | |||
2019 | 6,521 | |||
2020 | 4,193 | |||
2021 | 3,591 | |||
Thereafter | 29,154 | |||
Total | 59,728 | |||
UGG brand | ||||
Goodwill | ||||
Total goodwill | 6,101 | 6,101 | ||
Sanuk brand | ||||
Goodwill | ||||
Total goodwill | 113,944 | 113,944 | ||
Other brands | ||||
Goodwill | ||||
Total goodwill | $ 7,889 | $ 7,889 |
Income Taxes - Income Tax Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2013 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Current income taxes | |||||
Federal | $ (572) | $ 11,971 | $ 35,459 | $ 51,058 | |
State | (4) | 2,443 | 6,861 | 6,252 | |
Foreign | 5,255 | 12,039 | 7,069 | 6,650 | |
Total | 4,679 | 26,453 | 49,389 | 63,960 | |
Deferred income taxes | |||||
Federal | 1,669 | 7,887 | 8,234 | (2,580) | |
State | (1) | 1,113 | 624 | (209) | |
Foreign | (4,404) | (833) | 1,112 | (1,303) | |
Total | (2,736) | 8,167 | 9,970 | (4,092) | |
Income taxes | |||||
Income tax expense | 1,943 | $ 1,503 | 34,620 | 59,359 | 59,868 |
Foreign income before taxes | (3,631) | 105,938 | 95,850 | 60,851 | |
Actual income taxes differed from that obtained by applying the statutory federal income tax rate to income before income taxes | |||||
Computed expected income taxes | (260) | 54,910 | 77,399 | 71,945 | |
State income taxes, net of federal income tax benefit | 90 | 1,298 | 3,564 | 4,435 | |
Foreign rate differential | 1,904 | (28,233) | (25,535) | (16,399) | |
Unrecognized tax benefits | 0 | 3,670 | 3,566 | 0 | |
Foreign tax expense on diminution of operations | 0 | 1,352 | 0 | 0 | |
Other | 209 | 1,623 | 365 | (113) | |
Income tax expense | $ 1,943 | $ 1,503 | $ 34,620 | $ 59,359 | $ 59,868 |
Notes Payable and Long-Term Debt - Japan Line of Credit (Details) - Japan Credit Facility $ in Millions |
12 Months Ended | |
---|---|---|
Mar. 31, 2016
USD ($)
|
Mar. 31, 2016
JPY (¥)
|
|
Notes Payable and Long-Term Debt | ||
Debt Instrument, Covenant Compliance, Period of Not Having Losses | 2 years | |
Debt Instrument, Covenant Compliance, Interest Coverage Ratio | 1 | |
Maximum | ||
Notes Payable and Long-Term Debt | ||
Current borrowing capacity | $ 49 | ¥ 5,500,000,000 |
Debt Instrument, Term | 6 months | |
Tokyo Interbank Offered Rate (TIBOR) | ||
Notes Payable and Long-Term Debt | ||
Spread on variable interest rate (as a percent) | 0.40% | |
Debt Instrument, Tokyo Interbank Offered Rate (TIBOR) | 0.10% | 0.10% |
Debt Instrument, Interest Rate, Effective Percentage | 0.50% | 0.50% |
Notes Payable and Long-Term Debt - Mortgage (Details) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Mar. 31, 2016 |
Mar. 31, 2015 |
Jul. 31, 2014 |
|
Debt Instrument [Line Items] | |||
Short-term borrowings | $ 67,475,000 | $ 5,383,000 | |
Mortgage payable | 32,631,000 | $ 33,154,000 | |
Mortgages | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | $ 33,900,000 | ||
Long-term Debt, Gross | 33,200,000 | ||
Short-term borrowings | 600,000 | ||
Mortgage payable | $ 32,600,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 4.928% | ||
Debt Instrument, Amortization Period | 30 years | ||
Debt Instrument, Periodic Payment Terms, Balloon Payment to be Paid | $ 23,400,000 | ||
Debt Instrument, Term for Minimum Payments | 5 years | ||
Debt Instrument, Annual Principal Payment | $ 2,900,000 |
Commitments and Contingencies - Lease Commitments (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Future minimum commitments under the lease agreements | ||||
2017 | $ 50,763 | |||
2018 | 51,087 | |||
2019 | 43,210 | |||
2020 | 35,179 | |||
2021 | 30,873 | |||
Thereafter | 104,328 | |||
Total | 315,440 | |||
Composition of total rental expense | ||||
Minimum rentals | $ 14,260 | 61,227 | $ 61,363 | $ 47,871 |
Contingent rentals | 3,099 | 16,067 | 14,707 | 12,318 |
Total | $ 17,359 | $ 77,294 | $ 76,070 | $ 60,189 |
Minimum | ||||
Commitments and Contingencies | ||||
Term of renewal options range (in years) | 1 year | |||
Maximum | ||||
Commitments and Contingencies | ||||
Term of renewal options range (in years) | 15 years |
Commitments and Contingencies - Purchase Commitments (Details) $ in Thousands |
Mar. 31, 2016
USD ($)
|
---|---|
Purchase commitments entered in May 2015 | |
Future commitments | |
Advance Deposits | $ 0 |
Total Minimum Commitment | 82,800 |
Remaining Deposit | 16,651 |
Remaining Commitments, Net of Deposit | 13,374 |
Purchase commitments entered in September 2015 | |
Future commitments | |
Advance Deposits | 0 |
Total Minimum Commitment | 46,865 |
Remaining Deposit | 0 |
Remaining Commitments, Net of Deposit | 28,060 |
Purchase commitments entered in September 2015 Two | |
Future commitments | |
Advance Deposits | 0 |
Total Minimum Commitment | 7,200 |
Remaining Deposit | 0 |
Remaining Commitments, Net of Deposit | 5,711 |
Purchase commitments entered in September 2015 Three | |
Future commitments | |
Advance Deposits | 0 |
Total Minimum Commitment | 55,200 |
Remaining Deposit | 0 |
Remaining Commitments, Net of Deposit | $ 55,200 |
Stockholders' Equity -ESPP (Details) - Employee Stock Purchase Plan 2015 |
1 Months Ended |
---|---|
Sep. 30, 2015
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 1,000,000 |
Award purchase period | 6 months |
Discount from Market Price, Purchase Date | 15.00% |
Transition Period (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2014 |
Mar. 31, 2014 |
Mar. 31, 2013 |
Jun. 30, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Transition Period [Abstract] | |||||||||||||
Net sales | $ 378,635 | $ 795,902 | $ 486,855 | $ 213,805 | $ 340,637 | $ 784,678 | $ 480,273 | $ 294,716 | $ 263,760 | $ 211,469 | $ 1,875,197 | $ 1,817,057 | $ 1,556,618 |
Cost of sales | 150,456 | 140,201 | 1,028,529 | 938,949 | 820,135 | ||||||||
Gross profit | $ 154,942 | $ 391,017 | $ 214,113 | $ 86,596 | $ 152,324 | $ 415,139 | $ 223,873 | 144,260 | 123,559 | $ 86,772 | 846,668 | 878,108 | 736,483 |
Selling, general and administrative expenses | 144,668 | 120,907 | 684,541 | 653,689 | 528,586 | ||||||||
Income (loss) from operations | (408) | 2,652 | 162,127 | 224,419 | 207,897 | ||||||||
Other expense (income), net: | |||||||||||||
Interest income | (65) | (26) | (420) | (207) | (60) | ||||||||
Interest expense | 516 | 339 | 5,814 | 4,220 | 3,079 | ||||||||
Other, net | (117) | (171) | (152) | (733) | (679) | ||||||||
Total other expense, net | 334 | 142 | 5,242 | 3,280 | 2,340 | ||||||||
(Loss) income before income taxes | (742) | 2,510 | 156,885 | 221,139 | 205,557 | ||||||||
Income tax expense | 1,943 | 1,503 | 34,620 | 59,359 | 59,868 | ||||||||
Net income (loss) | (2,685) | 1,007 | 122,265 | 161,780 | 145,689 | ||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||
Unrealized (loss) gain on foreign currency hedging | (273) | 1,530 | 461 | 450 | (486) | ||||||||
Foreign currency translation adjustment | 873 | (674) | (550) | (18,875) | (757) | ||||||||
Total other comprehensive (loss) income | 600 | 856 | (89) | (18,425) | (1,243) | ||||||||
Comprehensive income (loss) | $ (2,085) | $ 1,863 | $ 122,176 | $ 143,355 | $ 144,446 | ||||||||
Net (loss) income per share: | |||||||||||||
Basic (in dollars per share) | $ (0.73) | $ 4.85 | $ 1.12 | $ (1.43) | $ 0.04 | $ 4.54 | $ 1.18 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.76 | $ 4.70 | $ 4.23 |
Diluted (in dollars per share) | $ (0.73) | $ 4.78 | $ 1.11 | $ (1.43) | $ 0.04 | $ 4.50 | $ 1.17 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.70 | $ 4.66 | $ 4.18 |
Weighted-average common shares outstanding: | |||||||||||||
Basic (in shares) | 34,621 | 34,404 | 32,556 | 34,433 | 34,473 | ||||||||
Diluted (in shares) | 34,621 | 34,788 | 33,039 | 34,733 | 34,829 |
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands |
Mar. 31, 2016 |
Mar. 31, 2015 |
---|---|---|
Accumulated other comprehensive income | ||
Cumulative foreign currency translation adjustment | $ (20,709) | $ (20,159) |
Unrealized gain (loss) on foreign currency hedging, net of tax | 152 | (309) |
Accumulated other comprehensive loss | $ (20,557) | $ (20,468) |
Business Segments (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2016
USD ($)
|
Dec. 31, 2015
USD ($)
|
Sep. 30, 2015
USD ($)
|
Jun. 30, 2015
USD ($)
segment
|
Mar. 31, 2015
USD ($)
|
Dec. 31, 2014
USD ($)
|
Sep. 30, 2014
USD ($)
|
Mar. 31, 2014
USD ($)
|
Mar. 31, 2013
USD ($)
|
Jun. 30, 2014
USD ($)
|
Mar. 31, 2016
USD ($)
store
segment
|
Mar. 31, 2015
USD ($)
store
segment
|
Dec. 31, 2013
USD ($)
|
|
Segment Reporting Information [Line Items] | |||||||||||||
Number of Reportable Segments | segment | 1 | 5 | 5 | ||||||||||
Number of stores converted to partner retail stores | store | 3 | 7 | |||||||||||
Net sales to external customers | $ 378,635 | $ 795,902 | $ 486,855 | $ 213,805 | $ 340,637 | $ 784,678 | $ 480,273 | $ 294,716 | $ 263,760 | $ 211,469 | $ 1,875,197 | $ 1,817,057 | $ 1,556,618 |
Income (loss) from operations | (408) | $ 2,652 | 162,127 | 224,419 | 207,897 | ||||||||
Depreciation and amortization | 10,569 | 50,024 | 49,293 | 41,439 | |||||||||
Depreciation, Depletion and Amortization | 10,538 | 49,741 | 49,150 | 41,370 | |||||||||
Capital expenditures | 17,620 | 66,186 | 91,853 | 79,830 | |||||||||
Total assets | 1,278,068 | 1,169,933 | 1,278,068 | 1,169,933 | |||||||||
UGG Wholesale Segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales to external customers | 83,271 | 918,102 | 903,926 | 818,377 | |||||||||
Income (loss) from operations | 13,595 | 246,990 | 269,489 | 224,738 | |||||||||
Depreciation and amortization | 137 | 2,107 | 5,029 | 641 | |||||||||
Capital expenditures | 119 | 1,458 | 246 | 313 | |||||||||
Total assets | 248,937 | 194,720 | 153,341 | 248,937 | 194,720 | 314,122 | |||||||
Teva Wholesale Segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales to external customers | 45,283 | 121,239 | 116,931 | 109,334 | |||||||||
Income (loss) from operations | 6,425 | 17,692 | 13,320 | 9,166 | |||||||||
Depreciation and amortization | 33 | 54 | 94 | 641 | |||||||||
Capital expenditures | 0 | 0 | 51 | 63 | |||||||||
Total assets | 87,225 | 77,423 | 81,766 | 87,225 | 77,423 | 54,868 | |||||||
Sanuk Wholesale Segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales to external customers | 28,793 | 90,719 | 102,690 | 94,420 | |||||||||
Income (loss) from operations | 7,530 | 15,565 | 21,914 | 20,591 | |||||||||
Depreciation and amortization | 1,769 | 6,556 | 6,969 | 7,761 | |||||||||
Capital expenditures | 2 | 881 | 487 | 91 | |||||||||
Total assets | 212,816 | 224,974 | 214,627 | 212,816 | 224,974 | 208,669 | |||||||
Other Wholesale Segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales to external customers | 18,662 | 100,820 | 76,152 | 38,276 | |||||||||
Income (loss) from operations | (758) | (4,384) | (9,838) | (9,807) | |||||||||
Depreciation and amortization | 250 | 1,101 | 940 | 507 | |||||||||
Capital expenditures | 26 | 51 | 351 | 477 | |||||||||
Total assets | 65,072 | 53,634 | 41,281 | 65,072 | 53,634 | 34,315 | |||||||
Retail Stores Segment | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Net sales to external customers | 118,707 | 644,317 | 617,358 | 496,211 | |||||||||
Income (loss) from operations | 20,918 | 101,756 | 150,320 | 132,532 | |||||||||
Depreciation and amortization | 5,209 | 18,931 | 21,088 | 21,861 | |||||||||
Capital expenditures | 3,557 | 18,445 | 19,128 | 35,669 | |||||||||
Total assets | 148,733 | 147,423 | 163,664 | 148,733 | 147,423 | 189,822 | |||||||
Unallocated to Segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Income (loss) from operations | (48,118) | (215,492) | (220,786) | (169,323) | |||||||||
Depreciation and amortization | 3,140 | 20,992 | 15,030 | 9,959 | |||||||||
Capital expenditures | 13,916 | 45,351 | 71,590 | 43,217 | |||||||||
Reportable segments | |||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||
Total assets | $ 762,783 | $ 698,174 | $ 654,679 | $ 762,783 | $ 698,174 | $ 801,796 |
Business Segments - Reconciliation (Details) - USD ($) $ in Thousands |
Mar. 31, 2016 |
Mar. 31, 2015 |
Mar. 31, 2014 |
Dec. 31, 2013 |
Dec. 31, 2012 |
---|---|---|---|---|---|
Reconciliations of total assets from reportable segments to the condensed consolidated balance sheets | |||||
Cash and cash equivalents | $ 245,956 | $ 225,143 | $ 245,088 | $ 237,125 | $ 110,247 |
Unallocated deferred tax assets | 20,636 | 29,083 | |||
Total assets | 1,278,068 | 1,169,933 | |||
Reportable segments | |||||
Reconciliations of total assets from reportable segments to the condensed consolidated balance sheets | |||||
Total assets | 762,783 | 698,174 | $ 654,679 | $ 801,796 | |
Unallocated to Segments | |||||
Reconciliations of total assets from reportable segments to the condensed consolidated balance sheets | |||||
Other unallocated corporate assets | $ 248,693 | $ 217,533 |
Concentration of Business, Significant Customers and Credit Risk Cash Equivalents (Details) - USD ($) $ in Thousands |
Mar. 31, 2016 |
Mar. 31, 2015 |
Mar. 31, 2014 |
Dec. 31, 2013 |
Dec. 31, 2012 |
---|---|---|---|---|---|
Risks and Uncertainties [Abstract] | |||||
Money market fund accounts | $ 195,575 | $ 127,900 | |||
Cash | 50,381 | 97,243 | |||
Cash and cash equivalents | $ 245,956 | $ 225,143 | $ 245,088 | $ 237,125 | $ 110,247 |
Quarterly Summary of Information (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2016 |
Dec. 31, 2015 |
Sep. 30, 2015 |
Jun. 30, 2015 |
Mar. 31, 2015 |
Dec. 31, 2014 |
Sep. 30, 2014 |
Mar. 31, 2014 |
Mar. 31, 2013 |
Jun. 30, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
|
Summarized unaudited quarterly financial data | |||||||||||||
Net sales | $ 378,635 | $ 795,902 | $ 486,855 | $ 213,805 | $ 340,637 | $ 784,678 | $ 480,273 | $ 294,716 | $ 263,760 | $ 211,469 | $ 1,875,197 | $ 1,817,057 | $ 1,556,618 |
Gross profit | 154,942 | 391,017 | 214,113 | 86,596 | 152,324 | 415,139 | 223,873 | $ 144,260 | $ 123,559 | 86,772 | $ 846,668 | $ 878,108 | $ 736,483 |
Net (loss) income | $ (23,706) | $ 156,921 | $ 36,377 | $ (47,327) | $ 1,406 | $ 156,706 | $ 40,730 | $ (37,062) | |||||
Net income (loss) per share: | |||||||||||||
Basic (in dollars per share) | $ (0.73) | $ 4.85 | $ 1.12 | $ (1.43) | $ 0.04 | $ 4.54 | $ 1.18 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.76 | $ 4.70 | $ 4.23 |
Diluted (in dollars per share) | $ (0.73) | $ 4.78 | $ 1.11 | $ (1.43) | $ 0.04 | $ 4.50 | $ 1.17 | $ (0.08) | $ 0.03 | $ (1.07) | $ 3.70 | $ 4.66 | $ 4.18 |
Schedule II VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands |
3 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|
Mar. 31, 2014 |
Mar. 31, 2016 |
Mar. 31, 2015 |
Dec. 31, 2013 |
Dec. 31, 2014 |
Apr. 01, 2014 |
|
Valuation and qualifying accounts | ||||||
Balance at Beginning of Year | $ 25,068 | $ 18,218 | $ 15,569 | |||
Balance at End of Year | 15,569 | 30,195 | 18,218 | $ 25,068 | ||
Total | 25,068 | 18,218 | 15,569 | 25,068 | ||
Allowance for doubtful accounts | ||||||
Valuation and qualifying accounts | ||||||
Balance at Beginning of Year | 2,039 | 2,297 | 1,798 | 2,782 | ||
Additions | 594 | 5,120 | 1,107 | 125 | ||
Deductions | 835 | 1,923 | 608 | 868 | ||
Balance at End of Year | 1,798 | 5,494 | 2,297 | 2,039 | ||
Total | 2,039 | 2,297 | 1,798 | 2,782 | $ 2,039 | $ 1,798 |
Allowance for sales discounts | ||||||
Valuation and qualifying accounts | ||||||
Balance at Beginning of Year | 3,540 | 2,348 | 2,121 | 3,836 | ||
Additions | 978 | 93,431 | 68,620 | 46,989 | ||
Deductions | 2,397 | 93,107 | 68,393 | 47,285 | ||
Balance at End of Year | 2,121 | 2,672 | 2,348 | 3,540 | ||
Total | 3,540 | 2,348 | 2,121 | 3,836 | 2,121 | |
Allowance for sales returns | ||||||
Valuation and qualifying accounts | ||||||
Balance at Beginning of Year | 14,554 | 9,532 | 8,586 | 12,905 | ||
Additions | 674 | 112,675 | 94,138 | 67,800 | ||
Deductions | 6,642 | 105,146 | 93,192 | 66,151 | ||
Balance at End of Year | 8,586 | 17,061 | 9,532 | 14,554 | ||
Total | 14,554 | 9,532 | 8,586 | 12,905 | 8,586 | |
Chargeback allowance | ||||||
Valuation and qualifying accounts | ||||||
Balance at Beginning of Year | 4,935 | 4,041 | 3,064 | 5,563 | ||
Additions | 213 | 2,267 | 2,610 | 187 | ||
Deductions | 2,084 | 1,340 | 1,633 | 815 | ||
Balance at End of Year | 3,064 | 4,968 | 4,041 | 4,935 | ||
Total | $ 4,935 | $ 4,041 | $ 3,064 | $ 5,563 | $ 3,064 |
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