Quarterly Financial Information (unaudited) (Tables)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Information

(In thousands, except per share data)

Year Ended December 31, 2019	First		Second		Third		Fourth ⁽¹⁾
Revenues	$	214,094	$	340,377	$	303,897	$	272,789
Gross margin		71,748		138,255		117,387		81,802
Income (loss) before income taxes		9,582		26,252		18,593		(380,837	)
Net income (loss)		4,214		18,137		13,920		(323,092	)

Earnings (loss) per share ⁽²⁾
Basic	$	0.10	$	0.38	$	0.29	$	(6.69	)
Diluted	$	0.10	$	0.37	$	0.29	$	(6.69	)

(In thousands, except per share data)

Year Ended December 31, 2018	First		Second		Third		Fourth ⁽⁴⁾
Revenues	$	149,930	$	151,865	$	151,467	$	153,037
Gross margin		43,559		46,454		46,718		47,126
Income before income taxes		28,493		30,352		34,386		31,717
Income from continuing operations		21,336		22,683		25,357		28,526
Income from discontinued operations, net of income tax		—		901		—		—
Net income		21,336		23,584		25,357		28,526

Earnings per share – basic:
Continuing operations ⁽²⁾	$	0.54	$	0.57	$	0.63	$	0.70
Discontinued operations⁽²⁾	$	—	$	0.02	$	—	$	—
Net income ^{(2) (3)}	$	0.54	$	0.59	$	0.63	$	0.70

Earnings per share – diluted:
Continuing operations ⁽²⁾	$	0.49	$	0.52	$	0.59	$	0.67
Discontinued operations⁽²⁾	$	—	$	0.02	$	—	$	—
Net income ^{(2) (3)}	$	0.49	$	0.54	$	0.59	$	0.67

⁽¹⁾

During the fourth quarter of 2019, we recorded an impairment loss of $377.1 million related to the Nutrisystem tradename and the goodwill allocated to the Nutrition segment. In addition, we incurred acquisition, integration, and project costs totaling $5.8 million, which were primarily recorded to selling, general, and administrative expenses (see Note 18 for full year amounts). Also in the fourth quarter of 2019, we recorded a purchase accounting measurement period adjustment to finalize estimates related to the customer list intangible asset recorded in connection with the acquisition of Nutrisystem. The finalization of the estimate resulted in incremental amortization expense during the fourth quarter of 2019 of $17.4 million. Our effective tax rate for the fourth quarter of 2019 was a benefit of 15.2%, which was less than our statutory tax benefit rate and represents a decrease compared to the first three quarters of 2019. This decrease is primarily due to the nondeductible goodwill impairment loss of $137.1 million recorded in the fourth quarter. Finally, the impact of potentially dilutive securities for the three months ended December 31, 2019 was not considered because the impact would be anti-dilutive.

⁽²⁾

We calculated earnings per share for each of the quarters based on the weighted average number of shares and dilutive securities outstanding for each period. Accordingly, the sum of the quarters may not necessarily be equal to the full year income per share.

⁽³⁾

Figures may not add due to rounding.

⁽⁴⁾

^{During the fourth quarter of 2018, we incurred $3.3 million of project costs in connection with potential and pending acquisitions, which were recorded to selling, general, and administrative expenses. In addition, our effective tax rate for the fourth quarter of 2018 of 10.1% was lower than our statutory rate primarily due to positive tax benefits of $4.6 million related to the vesting of stock-based compensation awards during the quarter.}