☑
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED AUGUST 31, 2018
|
OR
|
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ___ TO ___
|
Utah
|
|
1-11107
|
|
87-0401551
|
(State or other jurisdiction of incorporation or organization)
|
|
(Commission File No.)
|
|
(IRS Employer Identification No.)
|
Title of Each Class
|
Name of Each Exchange on Which Registered
|
|
Common Stock, $.05 Par Value
|
|
New York Stock Exchange
|
Large accelerated filer
|
£
|
Accelerated filer
|
☑
|
Non-accelerated filer
|
£
|
Smaller reporting company
|
☑
|
Emerging growth company
|
£
|
FranklinCovey Co.
|
||||
|
||||
2 | ||||
Business
|
2 | |||
Risk Factors
|
9 | |||
Unresolved Staff Comments
|
19 | |||
Properties
|
20 | |||
Legal Proceedings
|
20 | |||
Mine Safety Disclosures
|
20 | |||
21 | ||||
Market for the Registrant's Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities
|
21 | |||
Selected Financial Data
|
24 | |||
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
25 | |||
Quantitative and Qualitative Disclosures About Market Risk
|
49 | |||
Financial Statements and Supplementary Data
|
50 | |||
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
95 | |||
Controls and Procedures
|
95 | |||
Other Information
|
96 | |||
96 | ||||
Directors, Executive Officers and Corporate Governance
|
96 | |||
Executive Compensation
|
97 | |||
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
97 | |||
Certain Relationships and Related Transactions, and Director Independence
|
98 | |||
Principal Accountant Fees and Services
|
98 | |||
99 | ||||
Exhibits and Financial Statement Schedules
|
99 | |||
Form 10-K Summary
|
103 | |||
104 |
·
|
Robert Gregory Partners – In May 2017, we acquired the assets of Robert Gregory Partners, LLC (RGP), a corporate coaching firm with expertise in executive coaching, transition acceleration coaching, leadership development coaching, implementation coaching, and consulting.
|
·
|
Jhana Education – In July 2017, we acquired the stock of Jhana Education (Jhana), a company that specializes in the creation and dissemination of relevant, bite-sized content and learning tools for leaders and managers.
|
1.
|
World Class Content – Rather than rely on "flavor of the month" training fads, our content is principle-centered and based on natural laws of human behavior and effectiveness. Our content is designed to build new skillsets, establish new mindsets, and provide enabling toolsets. When our content is applied consistently in an organization, we believe the culture of that organization will change to enable the organization to achieve its own great purposes. Our content is well researched, subjected to numerous field beta tests, and improved through a proven development process.
|
2.
|
Breadth and Scalability of Delivery Options – We have a wide range of content delivery options, including: The All Access Pass and Leader in Me online, other intellectual property licensing arrangements, on-site training, training led through certified facilitators, on-line learning, blended learning, and organization-wide transformational processes, including consulting and coaching services.
|
3.
|
Global Capability – We not only operate domestically with sales personnel in the United States and Canada, but we also deliver content through our directly owned international offices and independently owned international licensees who deliver our content in over 150 other countries and territories around the world. This capability allows us to deliver content to a wide range of customers, from large, multinational corporations to smaller, local entities.
|
·
|
Direct Offices – Our Direct Office segment has a depth of expertise in helping organizations solve problems that require changes in human behavior, including leadership, productivity, execution, trust, and sales performance. We have a variety of principle-based offerings that help build winning and profitable cultures. This segment includes our sales personnel that serve the United States and Canada; our international sales offices located in Japan, China, the United Kingdom, and Australia; our governmental sales channel; and our public program operations.
|
·
|
Education Practice – Centered around the principles found in The Leader in Me, the Education practice is dedicated to helping educational institutions build a culture that will produce great results. We believe these results are manifested by increases in student performance, improved school culture, decreased disciplinary issues, and increased teacher
|
·
|
International Licensees – Our independently owned international licensees provide our offerings and services in countries where we do not have a directly owned office. These licensee partners allow us to expand the reach of our services to large multinational organizations as well as smaller organizations in their countries. This segment's results are primarily comprised of royalty revenues received from these licensees.
|
·
|
Quality of offerings, services, and solutions
|
·
|
Skills and capabilities of people
|
·
|
Innovative training and consulting services combined with effective products
|
·
|
Ability to add value to client operations
|
·
|
Reputation and client references
|
·
|
Price
|
·
|
Availability of appropriate resources
|
·
|
Global reach and scale
|
·
|
Branding and name recognition in our marketplace
|
·
|
Restrictions on the movement of cash
|
·
|
Burdens of complying with a wide variety of national and local laws, including tax laws
|
·
|
The absence in some jurisdictions of effective laws to protect our intellectual property rights
|
·
|
Political instability
|
·
|
Currency exchange rate fluctuations
|
·
|
Longer payment cycles
|
·
|
Price controls or restrictions on exchange of foreign currencies
|
·
|
Fluctuations in our quarterly results of operations and cash flows
|
·
|
Increased overall market volatility
|
·
|
Variations between our actual financial results and market expectations
|
·
|
Changes in our key balances, such as cash and cash equivalents
|
·
|
Currency exchange rate fluctuations
|
·
|
Unexpected asset impairment charges
|
·
|
Increased or decreased analyst coverage
|
·
|
Our clients' perceptions of our ability to add value through our programs and content
|
·
|
Competition
|
·
|
General economic conditions
|
·
|
Introduction of new programs or services by us or our competitors
|
·
|
Our ability to accurately estimate, attain, and sustain engagement sales, margins, and cash flows over longer contract periods
|
·
|
Governmental entities typically fund projects through appropriated monies. While these projects are often planned and executed as multi-year projects, the governmental entities usually reserve the right to change the scope of, or terminate, these projects for lack of approved funding and other discretionary reasons. Changes in governmental priorities or other political developments, including disruptions in governmental operations, could result in changes in the scope of, or in termination of, our existing contracts.
|
·
|
Governmental entities often reserve the right to audit our contract costs, including allocated indirect costs, and conduct inquiries and investigations of our business practices with respect to our government contracts. If the governmental entity finds that the costs are not reimbursable, then we will not be allowed to bill for those costs or the cost must be refunded to the client if it has already been paid to us. Findings from an audit also may result in our being required to prospectively adjust previously agreed upon rates for our work, which may affect our future margins.
|
·
|
If a governmental client discovers improper activities in the course of audits or investigations, we may become subject to various civil and criminal penalties and administrative sanctions, which may include termination of contracts, forfeiture of profits, suspension of payments, fines and suspensions or debarment from doing business with other agencies of that government. The inherent limitations of internal controls may not prevent or detect all improper or illegal activities, regardless of their adequacy.
|
·
|
Political and economic factors such as pending elections, the outcome of elections, revisions to governmental tax policies, sequestration, debt ceiling negotiations, and reduced tax revenues can affect the number and terms of new governmental contracts signed.
|
·
|
Develop new services, programs, or offerings
|
·
|
Take advantage of opportunities, including business acquisitions
|
·
|
Respond to competitive pressures
|
ITEM 5. |
MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
High
|
Low
|
|||||||
Fiscal Year Ended August 31, 2018:
|
||||||||
Fourth Quarter
|
$
|
29.60
|
$
|
24.05
|
||||
Third Quarter
|
29.90
|
24.10
|
||||||
Second Quarter
|
31.20
|
18.00
|
||||||
First Quarter
|
20.95
|
18.20
|
||||||
|
||||||||
Fiscal Year Ended August 31, 2017:
|
||||||||
Fourth Quarter
|
$
|
21.10
|
$
|
17.35
|
||||
Third Quarter
|
22.30
|
15.20
|
||||||
Second Quarter
|
21.45
|
16.95
|
||||||
First Quarter
|
22.45
|
15.44
|
Period
|
Total Number of Shares Purchased
|
Average Price Paid Per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs(1)
(in thousands)
|
||||||||||||
June 1, 2018 to June 30, 2018
|
-
|
$
|
-
|
-
|
$
|
13,174
|
||||||||||
July 1, 2018 to July 31, 2018
|
-
|
- | - |
13,174
|
||||||||||||
August 1, 2018 to August 31, 2018
|
-
|
- | - |
13,174
|
||||||||||||
Total Common Shares
|
-
|
$ | - | - |
(1)
|
On January 23, 2015, our Board of Directors approved a new plan to repurchase up to $10.0 million of the Company's outstanding common stock. All previously existing common stock repurchase plans were canceled and the new common share repurchase plan does not have an expiration date. On March 27, 2015, our Board of Directors increased the aggregate value of shares of Company common stock that may be purchased under the January 2015 plan to $40.0 million so long as we have either $10.0 million in cash and cash equivalents or have access to debt financing of at least $10.0 million. Under the terms of this expanded common stock repurchase plan, we have purchased 1,539,828 shares of our common stock for $26.8 million through August 31, 2018.
|
August 31,
|
2018
|
2017(1)
|
2016
|
2015(2)
|
2014(2)
|
|||||||||||||||
In thousands, except per-share data
|
||||||||||||||||||||
Income Statement Data:
|
||||||||||||||||||||
Net sales
|
$
|
209,758
|
$
|
185,256
|
$
|
200,055
|
$
|
209,941
|
$
|
205,165
|
||||||||||
Gross profit
|
148,289
|
122,667
|
133,154
|
138,089
|
138,266
|
|||||||||||||||
Income (loss) from operations
|
(3,366
|
)
|
(8,880
|
)
|
13,849
|
19,529
|
24,765
|
|||||||||||||
Income (loss) before income taxes
|
(5,520
|
)
|
(10,909
|
)
|
11,911
|
17,412
|
21,759
|
|||||||||||||
Income tax benefit (provision)
|
(367
|
)
|
3,737
|
(4,895
|
)
|
(6,296
|
)
|
(3,692
|
)
|
|||||||||||
Net income (loss)
|
(5,887
|
)
|
(7,172
|
)
|
7,016
|
11,116
|
18,067
|
|||||||||||||
Earnings (loss) per share:
|
||||||||||||||||||||
Basic
|
$
|
(.43
|
)
|
$
|
(.52
|
)
|
$
|
.47
|
$
|
.66
|
$
|
1.08
|
||||||||
Diluted
|
(.43
|
)
|
(.52
|
)
|
.47
|
.66
|
1.07
|
|||||||||||||
Balance Sheet Data:
|
||||||||||||||||||||
Total current assets
|
$
|
100,163
|
$
|
91,835
|
$
|
89,741
|
$
|
95,425
|
$
|
93,016
|
||||||||||
Other long-term assets
|
12,935
|
16,005
|
13,713
|
14,807
|
14,785
|
|||||||||||||||
Total assets
|
213,875
|
210,731
|
190,871
|
200,645
|
205,186
|
|||||||||||||||
Long-term obligations
|
50,936
|
53,158
|
48,511
|
36,978
|
36,885
|
|||||||||||||||
Total liabilities
|
133,375
|
125,666
|
97,156
|
75,139
|
78,472
|
|||||||||||||||
Shareholders' equity
|
80,500
|
85,065
|
93,715
|
125,506
|
126,714
|
|||||||||||||||
Cash flows from operating activities
|
$
|
16,861
|
$
|
17,357
|
$
|
32,665
|
$
|
26,190
|
$
|
18,124
|
(1)
|
During fiscal 2017 we decided to allow new All Access Pass agreements to receive updated content throughout the contracted period. Accordingly, we defer substantially all AAP revenues at the inception of the agreements and recognize the revenue over the lives of the arrangements. The transition to the AAP model resulted in significantly reduced revenues and operating income during fiscal 2017.
|
(2)
|
We elected to amend previously filed U.S. federal income tax returns to claim foreign tax credits instead of foreign tax deductions and recognized significant income tax benefits which reduced our effective income tax rate during these years.
|
1.
|
World Class Content – Our content is principle-centered and based on natural laws of human behavior and effectiveness. When our content is applied consistently in an organization, we believe the culture of that organization will change to enable the organization to achieve their own great purposes. Our offerings are designed to build new skillsets, establish new mindsets, and provide enabling toolsets.
|
2.
|
Transformational Impact and Reach – We hold ourselves responsible for and measure ourselves by our clients' achievement of transformational results. Our commitment to achieving lasting impact extends to all of our clients—from CEOs to elementary school students, and from senior management to front-line workers in corporations, governmental, and educational environments.
|
3.
|
Breadth and Scalability of Delivery Options – We have a wide range of content delivery options, including: the All Access Pass and other intellectual property licenses, on-site training, training led through certified facilitators, on-line learning, blended learning, and organization-wide transformational processes, including consulting and coaching.
|
4.
|
Global Capability – We have sales professionals in the United States and Canada who serve clients in the private sector, in government, and in educational organizations; wholly owned subsidiaries in Australia, China, Japan, and the United Kingdom; and we contract with independent licensee partners who deliver our content and provide services in over 150 other countries and territories around the world.
|
YEAR ENDED
AUGUST 31,
|
2018
|
Percent change
|
2017
|
Percent change
|
2016
|
|||||||||||||||
Sales by Category:
|
||||||||||||||||||||
Training and consulting services
|
$
|
202,638
|
14
|
$
|
177,816
|
(6
|
)
|
$
|
189,661
|
|||||||||||
Products
|
3,577
|
(8
|
)
|
3,881
|
(35
|
)
|
6,009
|
|||||||||||||
Leasing
|
3,543
|
-
|
3,559
|
(19
|
)
|
4,385
|
||||||||||||||
$
|
209,758
|
13
|
$
|
185,256
|
(7
|
)
|
$
|
200,055
|
||||||||||||
Sales by Segment:
|
||||||||||||||||||||
Direct offices
|
$
|
145,890
|
19
|
$
|
122,309
|
(10
|
)
|
$
|
135,954
|
|||||||||||
Education practice
|
45,272
|
3
|
44,122
|
8
|
40,844
|
|||||||||||||||
International licensees
|
13,226
|
(3
|
)
|
13,571
|
(21
|
)
|
17,113
|
|||||||||||||
Corporate and other
|
5,370
|
2
|
5,254
|
(14
|
)
|
6,144
|
||||||||||||||
$
|
209,758
|
13
|
$
|
185,256
|
(7
|
)
|
$
|
200,055
|
·
|
New Subscription Service Sales and the Renewal of Existing Client Contracts – We are focused on sales of subscription service contracts, such as the All Access Pass, and have restructured our domestic sales force and sales support functions to more effectively sell and support these services. We believe we are well positioned to expand our subscription service revenues in the United States and Canada and reach new clients. We have translated AAP content into 15 new languages and expect this new feature will attract additional clients in future years both from large multinational entities and smaller clients that are served by our international direct offices and international licensee partners.
|
·
|
Education Segment – Our Education segment has consistently grown over the past several years. We intend to continue to invest in new content and additional sales personnel to reach out to new educational institutions while retaining existing The Leader in Me schools. We believe there are significant growth opportunities, both domestically and internationally, for our Education segment and its well-known The Leader in Me offering.
|
·
|
Growth of our Direct Office and International Licensee Segments – We are actively focused on growing the size and productivity of our Direct Office segment through expansion of our sales force to reach potential clients. In addition, we believe the acquisition of Robert Gregory Partners, LLC in fiscal 2017 will open new opportunities as we seek to expand our coaching business. We are also actively seeking to expand the size and productivity of our international licensee partners through the development of additional content, such as the translated AAP offerings, and additional licensee support activities.
|
YEAR ENDED
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Sales:
|
||||||||||||
Training and consulting services
|
96.6
|
%
|
96.0
|
%
|
94.8
|
%
|
||||||
Products
|
1.7
|
2.1
|
3.0
|
|||||||||
Leasing
|
1.7
|
1.9
|
2.2
|
|||||||||
Total sales
|
100.0
|
100.0
|
100.0
|
|||||||||
Cost of sales:
|
||||||||||||
Training and consulting services
|
27.7
|
30.5
|
29.6
|
|||||||||
Products
|
0.6
|
2.2
|
1.6
|
|||||||||
Leasing
|
1.0
|
1.1
|
1.2
|
|||||||||
Total cost of sales
|
29.3
|
33.8
|
32.4
|
|||||||||
Gross profit
|
70.7
|
66.2
|
67.6
|
|||||||||
Selling, general, and administrative
|
67.3
|
65.4
|
56.8
|
|||||||||
Contract termination costs
|
-
|
0.8
|
-
|
|||||||||
Restructuring costs
|
-
|
0.8
|
0.4
|
|||||||||
Depreciation
|
2.4
|
2.1
|
1.9
|
|||||||||
Amortization
|
2.6
|
1.9
|
1.6
|
|||||||||
Total operating expenses
|
72.3
|
71.0
|
60.7
|
|||||||||
Income (loss) from operations
|
(1.6
|
)
|
(4.8
|
)
|
6.9
|
|||||||
Interest income
|
0.0
|
0.1
|
0.1
|
|||||||||
Interest expense
|
(1.2
|
)
|
(1.3
|
)
|
(1.1
|
)
|
||||||
Accretion of discount on related party receivables
|
0.2
|
0.1
|
0.1
|
|||||||||
Income (loss) before income taxes
|
(2.6
|
)%
|
(5.9
|
)%
|
6.0
|
%
|
YEAR ENDED AUGUST 31,
|
2018
|
2017
|
$ Change
|
% Change
|
||||||||||||
SG&A expenses
|
$
|
137,266
|
$
|
119,426
|
$
|
17,840
|
15
|
|||||||||
Increase (decrease) to contingent payment liabilities
|
1,014
|
(1,936
|
)
|
2,950
|
n/a
|
|||||||||||
Stock-based compensation expense
|
2,846
|
3,658
|
(812
|
)
|
(22
|
)
|
||||||||||
Consolidated SG&A expense
|
141,126
|
121,148
|
19,978
|
16
|
||||||||||||
Contract termination costs
|
-
|
1,500
|
(1,500
|
)
|
(100
|
)
|
||||||||||
Restructuring costs
|
-
|
1,482
|
(1,482
|
)
|
(100
|
)
|
||||||||||
Depreciation
|
5,161
|
3,879
|
1,282
|
33
|
||||||||||||
Amortization
|
5,368
|
3,538
|
1,830
|
52
|
||||||||||||
$
|
151,655
|
$
|
131,547
|
$
|
20,108
|
15
|
YEAR ENDED AUGUST 31,
|
2017
|
2016
|
$ Change
|
% Change
|
||||||||||||
SG&A expenses
|
$
|
114,207
|
$
|
108,930
|
$
|
5,277
|
5
|
|||||||||
China SG&A expenses
|
5,219
|
-
|
5,219
|
n/a
|
||||||||||||
Increase (decrease) to contingent payment liabilities
|
(1,936
|
)
|
1,538
|
(3,474
|
)
|
n/a
|
||||||||||
Stock-based compensation expense
|
3,658
|
3,121
|
537
|
17
|
||||||||||||
Consolidated SG&A expense
|
121,148
|
113,589
|
7,559
|
7
|
||||||||||||
Contract termination costs
|
1,500
|
-
|
1,500
|
n/a
|
||||||||||||
Restructuring costs
|
1,482
|
776
|
706
|
91
|
||||||||||||
Depreciation
|
3,879
|
3,677
|
202
|
5
|
||||||||||||
Amortization
|
3,538
|
3,263
|
275
|
8
|
||||||||||||
$
|
131,547
|
$
|
121,305
|
$
|
10,242
|
8
|
YEAR ENDED AUGUST 31, 2018 (unaudited)
|
||||||||||||||||
November 30
|
February 28
|
May 31
|
August 31
|
|||||||||||||
Net sales
|
$
|
47,932
|
$
|
46,547
|
$
|
50,461
|
$
|
64,818
|
||||||||
Gross profit
|
32,868
|
32,744
|
34,916
|
47,761
|
||||||||||||
Selling, general, and administrative
|
33,824
|
35,097
|
34,910
|
37,294
|
||||||||||||
Depreciation
|
901
|
1,379
|
1,267
|
1,615
|
||||||||||||
Amortization
|
1,395
|
1,395
|
1,326
|
1,251
|
||||||||||||
Income (loss) from operations
|
(3,252
|
)
|
(5,127
|
)
|
(2,587
|
)
|
7,601
|
|||||||||
Income (loss) before income taxes
|
(3,740
|
)
|
(5,765
|
)
|
(3,088
|
)
|
7,074
|
|||||||||
Net income (loss)
|
(2,392
|
)
|
(2,740
|
)
|
(2,534
|
)
|
1,779
|
|||||||||
Net income (loss) per share:
|
||||||||||||||||
Basic and diluted
|
$
|
(.17
|
)
|
$
|
(.20
|
)
|
$
|
(.18
|
)
|
$
|
.13
|
|||||
YEAR ENDED AUGUST 31, 2017 (unaudited)
|
||||||||||||||||
November 26
|
February 28
|
May 31
|
August 31
|
|||||||||||||
Net sales
|
$
|
39,787
|
$
|
42,196
|
$
|
43,751
|
$
|
59,523
|
||||||||
Gross profit
|
25,308
|
28,031
|
27,341
|
41,988
|
||||||||||||
Selling, general, and administrative
|
29,095
|
29,370
|
30,713
|
31,970
|
||||||||||||
Contract termination costs
|
-
|
1,500
|
-
|
-
|
||||||||||||
Restructuring costs
|
-
|
-
|
1,335
|
147
|
||||||||||||
Depreciation
|
866
|
928
|
949
|
1,136
|
||||||||||||
Amortization
|
722
|
721
|
835
|
1,261
|
||||||||||||
Income (loss) from operations
|
(5,375
|
)
|
(4,488
|
)
|
(6,491
|
)
|
7,474
|
|||||||||
Income (loss) before income taxes
|
(5,875
|
)
|
(5,002
|
)
|
(7,023
|
)
|
6,995
|
|||||||||
Net income (loss)
|
(3,958
|
)
|
(3,333
|
)
|
(4,541
|
)
|
4,659
|
|||||||||
Net income (loss) per share:
|
||||||||||||||||
Basic
|
$
|
(.29
|
)
|
$
|
(.24
|
)
|
$
|
(.33
|
)
|
$
|
.34
|
|||||
Diluted
|
(.29
|
)
|
(.24
|
)
|
(.33
|
)
|
.33
|
YEAR ENDED AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Total cash provided by (used for):
|
||||||||||||
Operating activities
|
$
|
16,861
|
$
|
17,357
|
$
|
32,665
|
||||||
Investing activities
|
(10,634
|
)
|
(21,675
|
)
|
(6,229
|
)
|
||||||
Financing activities
|
(4,679
|
)
|
3,134
|
(32,535
|
)
|
|||||||
Effect of exchange rates on cash
|
(319
|
)
|
(348
|
)
|
321
|
|||||||
Increase (decrease) in cash and cash equivalents
|
$
|
1,229
|
$
|
(1,532
|
)
|
$
|
(5,778
|
)
|
Fiscal
|
Fiscal
|
Fiscal
|
Fiscal
|
Fiscal
|
||||||||||||||||||||||||
Contractual Obligations
|
2019
|
2020
|
2021
|
2022
|
2023
|
Thereafter
|
Total
|
|||||||||||||||||||||
Required lease payments on corporate campus
|
$
|
3,651
|
$
|
3,724
|
$
|
3,798
|
$
|
3,874
|
$
|
3,952
|
$
|
7,331
|
$
|
26,330
|
||||||||||||||
Term loans payable to bank(1)
|
10,650
|
2,571
|
-
|
-
|
-
|
-
|
13,221
|
|||||||||||||||||||||
Revolving line of credit(2)
|
442
|
442
|
11,595
|
-
|
-
|
-
|
12,479
|
|||||||||||||||||||||
Jhana contingent consideration payments(3)
|
922
|
1,436
|
2,021
|
172
|
-
|
-
|
4,551
|
|||||||||||||||||||||
Purchase obligations
|
3,464
|
802
|
-
|
-
|
-
|
-
|
4,266
|
|||||||||||||||||||||
Minimum operating lease payments
|
865
|
415
|
231
|
85
|
85
|
184
|
1,865
|
|||||||||||||||||||||
RGP contingent consideration payments(3)
|
-
|
1,000
|
-
|
-
|
-
|
-
|
1,000
|
|||||||||||||||||||||
Minimum required payments for warehousing services(3)
|
189
|
-
|
-
|
-
|
-
|
-
|
189
|
|||||||||||||||||||||
Total expected contractual
obligation payments
|
$
|
20,183
|
$
|
10,390
|
$
|
17,645
|
$
|
4,131
|
$
|
4,037
|
$
|
7,515
|
$
|
63,901
|
(1)
|
Payment amounts shown include interest at 3.9 percent, which is the current rate on our Term Loan obligations.
|
(2)
|
The amounts presented assume that the outstanding balance at August 31, 2018, including interest at 3.9 percent, is repaid at the maturity date of the amended and Restated Credit Agreement, which is March 31, 2021. However, we may repay amounts borrowed on the revolving line of credit without premium or penalty prior to the maturity date.
|
(3)
|
The payment of contingent consideration resulting from prior business acquisitions is based on current estimates and projections. We reassess the fair value of estimated contingent consideration payments each quarter based on information available. The actual payment of contingent consideration amounts may differ in amount and timing from those shown in the table.
|
(4)
|
The warehousing services contract expires in June 2019.
|
·
|
Training and Consulting Services – We provide training and consulting services to both organizations and individuals in leadership, productivity, strategic execution, trust, sales force performance, customer loyalty, and communication effectiveness skills.
|
·
|
Products – We sell books, audio media, and other related products.
|
·
|
significant underperformance relative to historical or projected future operating results;
|
·
|
significant change in the manner of our use of acquired assets or the strategy for the overall business;
|
·
|
significant change in prevailing interest rates;
|
·
|
significant negative industry or economic trend;
|
·
|
significant change in market capitalization relative to book value; and/or
|
·
|
significant negative change in market multiples of the comparable company set.
|
AUGUST 31,
|
2018
|
2017
|
||||||
In thousands, except per-share data
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
10,153
|
$
|
8,924
|
||||
Accounts receivable, less allowance for doubtful accounts of $3,555 and $2,310
|
71,914
|
66,343
|
||||||
Inventories
|
3,160
|
3,353
|
||||||
Income taxes receivable
|
179
|
259
|
||||||
Prepaid expenses
|
3,864
|
3,569
|
||||||
Other current assets
|
10,893
|
9,387
|
||||||
Total current assets
|
100,163
|
91,835
|
||||||
Property and equipment, net
|
21,401
|
19,730
|
||||||
Intangible assets, net
|
51,934
|
57,294
|
||||||
Goodwill
|
24,220
|
24,220
|
||||||
Deferred income tax assets
|
3,222
|
1,647
|
||||||
Other long-term assets
|
12,935
|
16,005
|
||||||
$
|
213,875
|
$
|
210,731
|
|||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Current portion of term notes payable
|
$
|
10,313
|
$
|
6,250
|
||||
Current portion of financing obligation
|
2,092
|
1,868
|
||||||
Accounts payable
|
9,790
|
9,119
|
||||||
Deferred revenue
|
51,888
|
40,772
|
||||||
Accrued liabilities
|
20,761
|
22,617
|
||||||
Total current liabilities
|
94,844
|
80,626
|
||||||
Line of credit
|
11,337
|
4,377
|
||||||
Term notes payable, less current portion
|
2,500
|
12,813
|
||||||
Financing obligation, less current portion
|
18,983
|
21,075
|
||||||
Other liabilities
|
5,501
|
5,742
|
||||||
Deferred income tax liabilities
|
210
|
1,033
|
||||||
Total liabilities
|
133,375
|
125,666
|
||||||
Commitments and contingencies (Notes 7 and 8)
|
||||||||
Shareholders' equity:
|
||||||||
Common stock, $.05 par value; 40,000 shares authorized, 27,056 shares issued
|
1,353
|
1,353
|
||||||
Additional paid-in capital
|
211,280
|
212,484
|
||||||
Retained earnings
|
63,569
|
69,456
|
||||||
Accumulated other comprehensive income
|
341
|
667
|
||||||
Treasury stock at cost, 13,159 shares and 13,414 shares
|
(196,043
|
)
|
(198,895
|
)
|
||||
Total shareholders' equity
|
80,500
|
85,065
|
||||||
$
|
213,875
|
$
|
210,731
|
YEAR ENDED AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
In thousands, except per-share amounts
|
||||||||||||
Net sales:
|
||||||||||||
Training and consulting services
|
$
|
202,638
|
$
|
177,816
|
$
|
189,661
|
||||||
Products
|
3,577
|
3,881
|
6,009
|
|||||||||
Leasing
|
3,543
|
3,559
|
4,385
|
|||||||||
209,758
|
185,256
|
200,055
|
||||||||||
Cost of sales:
|
||||||||||||
Training and consulting services
|
58,024
|
56,557
|
59,158
|
|||||||||
Products
|
1,251
|
3,990
|
3,206
|
|||||||||
Leasing
|
2,194
|
2,042
|
2,537
|
|||||||||
61,469
|
62,589
|
64,901
|
||||||||||
Gross profit
|
148,289
|
122,667
|
135,154
|
|||||||||
Selling, general, and administrative
|
141,126
|
121,148
|
113,589
|
|||||||||
Contract termination costs
|
-
|
1,500
|
-
|
|||||||||
Restructuring costs
|
-
|
1,482
|
776
|
|||||||||
Depreciation
|
5,161
|
3,879
|
3,677
|
|||||||||
Amortization
|
5,368
|
3,538
|
3,263
|
|||||||||
Income (loss) from operations
|
(3,366
|
)
|
(8,880
|
)
|
13,849
|
|||||||
Interest income
|
104
|
223
|
115
|
|||||||||
Interest expense
|
(2,676
|
)
|
(2,408
|
)
|
(2,263
|
)
|
||||||
Discount accretion on related-party receivables
|
418
|
156
|
210
|
|||||||||
Income (loss) before income taxes
|
(5,520
|
)
|
(10,909
|
)
|
11,911
|
|||||||
Benefit (provision) for income taxes
|
(367
|
)
|
3,737
|
(4,895
|
)
|
|||||||
Net income (loss)
|
$
|
(5,887
|
)
|
$
|
(7,172
|
)
|
$
|
7,016
|
||||
Net income (loss) per share:
|
||||||||||||
Basic and diluted
|
$
|
(0.43
|
)
|
$
|
(0.52
|
)
|
$
|
0.47
|
||||
Weighted average number of common shares:
|
||||||||||||
Basic
|
13,849
|
13,819
|
14,944
|
|||||||||
Diluted
|
13,849
|
13,819
|
15,076
|
|||||||||
COMPREHENSIVE INCOME (LOSS):
|
||||||||||||
Net income (loss)
|
$
|
(5,887
|
)
|
$
|
(7,172
|
)
|
$
|
7,016
|
||||
Foreign currency translation adjustments, net of income
|
||||||||||||
tax benefit (provision) of $(75), $37, and $115
|
(326
|
)
|
(555
|
)
|
1,030
|
|||||||
Comprehensive income (loss)
|
$
|
(6,213
|
)
|
$
|
(7,727
|
)
|
$
|
8,046
|
YEAR ENDED AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
In thousands
|
||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||||||
Net income (loss)
|
$
|
(5,887
|
)
|
$
|
(7,172
|
)
|
$
|
7,016
|
||||
Adjustments to reconcile net income (loss) to net cash provided
|
||||||||||||
by operating activities:
|
||||||||||||
Depreciation and amortization
|
10,525
|
7,443
|
6,943
|
|||||||||
Amortization of capitalized curriculum development costs
|
5,280
|
3,745
|
3,865
|
|||||||||
Deferred income taxes
|
(2,535
|
)
|
(5,594
|
)
|
1,854
|
|||||||
Stock-based compensation expense
|
2,846
|
3,658
|
3,121
|
|||||||||
Excess tax expense (benefit) from stock-based compensation
|
-
|
(168
|
)
|
52
|
||||||||
Increase (decrease) in contingent consideration liabilities
|
1,014
|
(1,936
|
)
|
1,538
|
||||||||
Changes in assets and liabilities, net of effect of acquired businesses:
|
||||||||||||
Decrease (increase) in accounts receivable, net
|
(5,679
|
)
|
164
|
(576
|
)
|
|||||||
Decrease (increase) in inventories
|
157
|
1,583
|
(908
|
)
|
||||||||
Decrease in receivable from related party
|
213
|
1,421
|
820
|
|||||||||
Increase in prepaid expenses and other assets
|
(1,335
|
)
|
(4,861
|
)
|
(1,119
|
)
|
||||||
Increase in accounts payable and accrued liabilities
|
1,746
|
676
|
2,264
|
|||||||||
Increase in deferred revenue
|
11,613
|
19,142
|
8,112
|
|||||||||
Increase (decrease) in income taxes payable/receivable
|
109
|
(249
|
)
|
(316
|
)
|
|||||||
Decrease in other liabilities
|
(1,206
|
)
|
(495
|
)
|
(1
|
)
|
||||||
Net cash provided by operating activities
|
16,861
|
17,357
|
32,665
|
|||||||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||||||||||
Purchases of property and equipment
|
(6,528
|
)
|
(7,187
|
)
|
(3,993
|
)
|
||||||
Capitalized curriculum development costs
|
(2,998
|
)
|
(6,466
|
)
|
(2,236
|
)
|
||||||
Acquisition of businesses, net of cash acquired
|
(1,108
|
)
|
(7,272
|
)
|
-
|
|||||||
Acquisition of license rights
|
-
|
(750
|
)
|
-
|
||||||||
Net cash used for investing activities
|
(10,634
|
)
|
(21,675
|
)
|
(6,229
|
)
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||
Proceeds from line of credit borrowings
|
93,391
|
34,320
|
46,454
|
|||||||||
Payments on line of credit borrowings
|
(86,431
|
)
|
(29,943
|
)
|
(46,454
|
)
|
||||||
Proceeds from term notes payable financing
|
-
|
10,000
|
15,000
|
|||||||||
Principal payments on term notes payable
|
(6,250
|
)
|
(5,000
|
)
|
(937
|
)
|
||||||
Principal payments on financing obligation
|
(1,868
|
)
|
(1,662
|
)
|
(1,472
|
)
|
||||||
Purchases of common stock for treasury
|
(2,006
|
)
|
(5,431
|
)
|
(43,586
|
)
|
||||||
Payment of contingent consideration liabilities
|
(2,323
|
)
|
-
|
(2,167
|
)
|
|||||||
Income tax benefit (expense) recorded in paid-in capital
|
-
|
168
|
(52
|
)
|
||||||||
Proceeds from sales of common stock held in treasury
|
808
|
682
|
679
|
|||||||||
Net cash provided by (used for) financing activities
|
(4,679
|
)
|
3,134
|
(32,535
|
)
|
|||||||
Effect of foreign currency exchange rates on cash and cash equivalents
|
(319
|
)
|
(348
|
)
|
321
|
|||||||
Net increase (decrease) in cash and cash equivalents
|
1,229
|
(1,532
|
)
|
(5,778
|
)
|
|||||||
Cash and cash equivalents at beginning of the year
|
8,924
|
10,456
|
16,234
|
|||||||||
Cash and cash equivalents at end of the year
|
$
|
10,153
|
$
|
8,924
|
$
|
10,456
|
||||||
Supplemental disclosure of cash flow information:
|
||||||||||||
Cash paid for income taxes
|
$
|
2,512
|
$
|
2,562
|
$
|
3,410
|
||||||
Cash paid for interest
|
2,655
|
2,314
|
2,231
|
|||||||||
Non-cash investing and financing activities:
|
||||||||||||
Purchases of property and equipment financed by accounts payable
|
$
|
1,018
|
$
|
697
|
$
|
334
|
Accumulated
|
||||||||||||||||||||||||||||
Other
|
||||||||||||||||||||||||||||
Common
|
Common
|
Additional
|
Retained
|
Comprehensive
|
Treasury
|
Treasury
|
||||||||||||||||||||||
Stock Shares
|
Stock Amount
|
Paid-In Capital
|
Earnings
|
Income
|
Stock Shares
|
Stock Amount
|
||||||||||||||||||||||
In thousands
|
||||||||||||||||||||||||||||
Balance at August 31, 2015
|
27,056
|
$
|
1,353
|
$
|
208,635
|
$
|
69,612
|
$
|
192
|
(10,909
|
)
|
$
|
(154,286
|
)
|
||||||||||||||
Issuance of common stock from
|
||||||||||||||||||||||||||||
treasury
|
(143
|
)
|
57
|
823
|
||||||||||||||||||||||||
Purchase of treasury shares
|
(2,505
|
)
|
(43,586
|
)
|
||||||||||||||||||||||||
Unvested share award
|
(356
|
)
|
25
|
356
|
||||||||||||||||||||||||
Stock-based compensation
|
3,121
|
|||||||||||||||||||||||||||
Cumulative translation
|
||||||||||||||||||||||||||||
adjustments
|
1,030
|
|||||||||||||||||||||||||||
Tax expense recorded in
|
||||||||||||||||||||||||||||
paid-in capital
|
(52
|
)
|
||||||||||||||||||||||||||
Other
|
(2
|
)
|
2
|
|||||||||||||||||||||||||
Net income
|
7,016
|
|||||||||||||||||||||||||||
Balance at August 31, 2016
|
27,056
|
1,353
|
211,203
|
76,628
|
1,222
|
(13,332
|
)
|
(196,691
|
)
|
|||||||||||||||||||
Issuance of common stock from
|
||||||||||||||||||||||||||||
treasury
|
(2,103
|
)
|
188
|
2,785
|
||||||||||||||||||||||||
Purchase of treasury shares
|
(300
|
)
|
(5,431
|
)
|
||||||||||||||||||||||||
Unvested share award
|
(442
|
)
|
30
|
442
|
||||||||||||||||||||||||
Stock-based compensation
|
3,658
|
|||||||||||||||||||||||||||
Cumulative translation
|
||||||||||||||||||||||||||||
adjustments
|
(555
|
)
|
||||||||||||||||||||||||||
Tax benefit recorded in
|
||||||||||||||||||||||||||||
paid-in capital
|
168
|
|||||||||||||||||||||||||||
Net loss
|
(7,172
|
)
|
||||||||||||||||||||||||||
Balance at August 31, 2017
|
27,056
|
1,353
|
212,484
|
69,456
|
667
|
(13,414
|
)
|
(198,895
|
)
|
|||||||||||||||||||
Issuance of common stock from
|
||||||||||||||||||||||||||||
treasury
|
(3,702
|
)
|
337
|
4,510
|
||||||||||||||||||||||||
Purchase of treasury shares
|
(105
|
)
|
(2,006
|
)
|
||||||||||||||||||||||||
Unvested share award
|
(348
|
)
|
23
|
348
|
||||||||||||||||||||||||
Stock-based compensation
|
2,846
|
|||||||||||||||||||||||||||
Cumulative translation
|
||||||||||||||||||||||||||||
adjustments
|
(326
|
)
|
||||||||||||||||||||||||||
Net loss
|
(5,887
|
)
|
||||||||||||||||||||||||||
Balance at August 31, 2018
|
27,056
|
$
|
1,353
|
$
|
211,280
|
$
|
63,569
|
$
|
341
|
(13,159
|
)
|
$
|
(196,043
|
)
|
1.
|
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
AUGUST 31,
|
2018
|
2017
|
||||||
Finished goods
|
$
|
3,130
|
$
|
3,306
|
||||
Raw materials
|
30
|
47
|
||||||
$
|
3,160
|
$
|
3,353
|
AUGUST 31,
|
2018
|
2017
|
||||||
Deferred commissions
|
$
|
6,958
|
$
|
6,150
|
||||
Other current assets
|
3,935
|
3,237
|
||||||
$
|
10,893
|
$
|
9,387
|
Description
|
Useful Lives
|
Buildings
|
20 years
|
Machinery and equipment
|
5–7 years
|
Computer hardware and software
|
3–5 years
|
Furniture, fixtures, and leasehold improvements
|
5–7 years
|
AUGUST 31,
|
2018
|
2017
|
||||||
Land and improvements
|
$
|
1,312
|
$
|
1,312
|
||||
Buildings
|
30,038
|
30,044
|
||||||
Machinery and equipment
|
1,723
|
2,119
|
||||||
Computer hardware and software
|
27,066
|
22,647
|
||||||
Furniture, fixtures, and leasehold
|
||||||||
improvements
|
8,272
|
8,319
|
||||||
68,411
|
64,441
|
|||||||
Less accumulated depreciation
|
(47,010
|
)
|
(44,711
|
)
|
||||
$
|
21,401
|
$
|
19,730
|
AUGUST 31,
|
2018
|
2017
|
||||||
Accrued compensation
|
$
|
11,858
|
$
|
10,611
|
||||
Other accrued liabilities
|
8,903
|
12,006
|
||||||
$
|
20,761
|
$
|
22,617
|
2. |
BUSINESS ACQUISITIONS
|
Cash paid to RGP at closing
|
$
|
3,500
|
||
Fair value of contingent consideration
|
1,413
|
|||
Total purchase price
|
$
|
4,913
|
Accounts receivable
|
$
|
458
|
||
Prepaid expenses
|
136
|
|||
Intangible assets
|
3,811
|
|||
Goodwill
|
1,232
|
|||
Assets acquired
|
5,637
|
|||
Accounts payable
|
(51
|
)
|
||
Accrued liabilities
|
(80
|
)
|
||
Deferred revenues
|
(593
|
)
|
||
Liabilities assumed
|
(724
|
)
|
||
$
|
4,913
|
Weighted Average
|
|||||
Description
|
Amount
|
Life
|
|||
Customer list
|
$
|
2,249
|
10 years
|
||
Content
|
461
|
5 years
|
|||
Trade name
|
341
|
5 years
|
|||
Non-compete agreements
|
328
|
2 years
|
|||
Deferred contract revenue
|
237
|
2 years
|
|||
Coach relationships
|
150
|
10 years
|
|||
Acquired technology
|
45
|
3 years
|
|||
$
|
3,811
|
8 years
|
Cash paid to Jhana at closing
|
$
|
3,525
|
||
Fair value of contingent consideration
|
6,052
|
|||
Total purchase price
|
$
|
9,577
|
Cash
|
$
|
253
|
||
Accounts receivable
|
195
|
|||
Prepaid expenses and other current assets
|
86
|
|||
Deferred tax asset
|
3,138
|
|||
Intangible assets
|
6,076
|
|||
Goodwill
|
3,085
|
|||
Assets acquired
|
12,833
|
|||
Accounts payable
|
(185
|
)
|
||
Accrued liabilities
|
(19
|
)
|
||
Deferred tax liability
|
(2,257
|
)
|
||
Deferred revenues
|
(795
|
)
|
||
Liabilities assumed
|
(3,256
|
)
|
||
$
|
9,577
|
Weighted Average
|
|||||
Description
|
Amount
|
Life
|
|||
Content
|
$
|
3,097
|
5 years
|
||
Acquired technology
|
1,474
|
3 years
|
|||
Customer list
|
1,016
|
5 years
|
|||
Trade name
|
445
|
5 years
|
|||
Non-compete agreements
|
44
|
3 years
|
|||
$
|
6,076
|
5 years
|
YEAR ENDED
|
||||||||
AUGUST 31,
|
2017
|
2016
|
||||||
Revenue
|
$
|
187,745
|
$
|
204,505
|
||||
Net income (loss)
|
(7,976
|
)
|
4,863
|
|||||
Diluted earnings (loss) per share
|
(0.58
|
)
|
0.32
|
3. |
ACCOUNTS RECEIVABLE
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Beginning balance
|
$
|
2,310
|
$
|
1,579
|
$
|
1,333
|
||||||
Charged to costs and expenses
|
2,029
|
1,747
|
2,022
|
|||||||||
Deductions
|
(784
|
)
|
(1,016
|
)
|
(1,776
|
)
|
||||||
Ending balance
|
$
|
3,555
|
$
|
2,310
|
$
|
1,579
|
4. |
INTANGIBLE ASSETS AND GOODWILL
|
Gross Carrying
|
Accumulated
|
Net Carrying
|
||||||||||
AUGUST 31, 2018
|
Amount
|
Amortization
|
Amount
|
|||||||||
Finite-lived intangible assets:
|
||||||||||||
License rights
|
$
|
27,750
|
$
|
(18,889
|
)
|
$
|
8,861
|
|||||
Acquired content
|
62,102
|
(46,147
|
)
|
15,955
|
||||||||
Customer lists
|
20,092
|
(17,835
|
)
|
2,257
|
||||||||
Acquired technology
|
3,568
|
(2,642
|
)
|
926
|
||||||||
Trade names
|
2,036
|
(1,441
|
)
|
595
|
||||||||
Non-compete agreements and other
|
758
|
(418
|
)
|
340
|
||||||||
116,306
|
(87,372
|
)
|
28,934
|
|||||||||
Indefinite-lived intangible asset:
|
||||||||||||
Covey trade name
|
23,000
|
-
|
23,000
|
|||||||||
$
|
139,306
|
$
|
(87,372
|
)
|
$
|
51,934
|
||||||
AUGUST 31, 2017
|
||||||||||||
Finite-lived intangible assets:
|
||||||||||||
License rights
|
$
|
27,750
|
$
|
(17,802
|
)
|
$
|
9,948
|
|||||
Acquired content
|
62,094
|
(43,864
|
)
|
18,230
|
||||||||
Customer lists
|
20,092
|
(16,935
|
)
|
3,157
|
||||||||
Acquired technology
|
3,568
|
(2,136
|
)
|
1,432
|
||||||||
Trade names
|
2,036
|
(1,163
|
)
|
873
|
||||||||
Non-compete agreements and other
|
758
|
(104
|
)
|
654
|
||||||||
116,298
|
(82,004
|
)
|
34,294
|
|||||||||
Indefinite-lived intangible asset:
|
||||||||||||
Covey trade name
|
23,000
|
-
|
23,000
|
|||||||||
$
|
139,298
|
$
|
(82,004
|
)
|
$
|
57,294
|
Category of Intangible Asset
|
Range of Remaining Estimated Useful Lives
|
Weighted Average Original Amortization Period
|
||
License rights
|
4 to 8 years
|
30 years
|
||
Acquired content
|
1 to 8 years
|
25 years
|
||
Customer lists
|
1 to 9 years
|
12 years
|
||
Acquired technology
|
2 years
|
3 years
|
||
Trade names
|
1 to 4 years
|
5 years
|
||
Non-compete agreements and other
|
1 to 9 years
|
4 years
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
4,790
|
||
2020
|
4,324
|
|||
2021
|
3,809
|
|||
2022
|
3,498
|
|||
2023
|
2,612
|
Balance at August 31, 2016
|
$
|
19,903
|
||
Acquisition of RGP (Note 2)
|
1,232
|
|||
Acquisition of Jhanna (Note 2)
|
3,085
|
|||
Accumulated impairments
|
-
|
|||
Balance at August 31, 2017
|
24,220
|
|||
Accumulated impairments
|
-
|
|||
Balance at August 31, 2018
|
$
|
24,220
|
Direct offices
|
$
|
2,592
|
||
Strategic markets
|
513
|
|||
Education practice
|
154
|
|||
International licensees
|
1,058
|
|||
$
|
4,317
|
Adjusted
|
||||||||||||
AUGUST 31,
|
2017
|
Goodwill
|
2018
|
|||||||||
Direct offices
|
$
|
13,382
|
$
|
3,443
|
$
|
16,825
|
||||||
Strategic markets
|
3,443
|
(3,443
|
)
|
-
|
||||||||
Education practice
|
2,330
|
-
|
2,330
|
|||||||||
International licensees
|
5,065
|
-
|
5,065
|
|||||||||
$
|
24,220
|
$
|
-
|
$
|
24,220
|
5. |
TERM LOANS PAYABLE AND REVOLVING LINE OF CREDIT
|
Original Principal
|
Quarterly Principal
|
Outstanding
|
||||||||||
Maturity Date
|
Amount
|
Payment Amount
|
Principal
|
|||||||||
May 24, 2019
|
$
|
15,000
|
$
|
938
|
$
|
6,563
|
||||||
August 29, 2019
|
5,000
|
313
|
2,500
|
|||||||||
August 29, 2020
|
5,000
|
313
|
3,750
|
|||||||||
$
|
12,813
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
10,313
|
||
2020
|
2,500
|
|||
$
|
12,813
|
·
|
Available Credit – $30.0 million as of August 31, 2018.
|
·
|
Maturity Date – March 31, 2021.
|
·
|
Interest Rate – The effective interest rate is LIBOR plus 1.85 percent per annum and the unused credit fee on the line of credit is 0.25 percent per annum.
|
·
|
Financial Covenants – The Restated Credit Agreement requires us to be in compliance with specified financial covenants, including (a) a funded debt to EBITDAR (earnings before interest, taxes, depreciation, amortization, and rental expense) ratio of less than 3.00 to 1.00; (b) a fixed charge coverage ratio greater than 1.15 to 1.0; (c) an annual limit on capital expenditures (not including capitalized curriculum development) of $8.0 million; and (d) consolidated accounts receivable must exceed 150 percent of the amount outstanding on the line of credit.
|
6. |
FINANCING OBLIGATION
|
AUGUST 31,
|
2018
|
2017
|
||||||
Financing obligation payable in
|
||||||||
monthly installments of $303 at
|
||||||||
August 31, 2018, including
|
||||||||
principal and interest, with two
|
||||||||
percent annual increases
|
||||||||
(imputed interest at 7.7%),
|
||||||||
through June 2025
|
$
|
21,075
|
$
|
22,943
|
||||
Less current portion
|
(2,092
|
)
|
(1,868
|
)
|
||||
Total financing obligation,
|
||||||||
less current portion
|
$
|
18,983
|
$
|
21,075
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
2,092
|
||
2020
|
2,335
|
|||
2021
|
2,600
|
|||
2022
|
2,887
|
|||
2023
|
3,199
|
|||
Thereafter
|
7,962
|
|||
$
|
21,075
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
3,651
|
||
2020
|
3,724
|
|||
2021
|
3,798
|
|||
2022
|
3,874
|
|||
2023
|
3,952
|
|||
Thereafter
|
7,331
|
|||
Total future minimum financing
|
||||
obligation payments
|
26,330
|
|||
Less interest
|
(6,567
|
)
|
||
Present value of future minimum
|
||||
financing obligation payments
|
$
|
19,763
|
7. |
OPERATING LEASES
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
865
|
||
2020
|
415
|
|||
2021
|
231
|
|||
2022
|
85
|
|||
2023
|
85
|
|||
Thereafter
|
184
|
|||
$
|
1,865
|
YEAR ENDING
|
||||
AUGUST 31,
|
||||
2019
|
$
|
3,789
|
||
2020
|
3,888
|
|||
2021
|
2,340
|
|||
2022
|
1,514
|
|||
2023
|
1,514
|
|||
Thereafter
|
2,802
|
|||
$
|
15,847
|
8. |
COMMITMENTS AND CONTINGENCIES
|
9. |
SHAREHOLDERS' EQUITY
|
10. |
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
·
|
Level 1 valuations are based on quoted prices in active markets for identical instruments that the Company can access at the measurement date.
|
·
|
Level 2 valuations are based on inputs other than quoted prices included in Level 1 that are observable for the instrument, either directly or indirectly, for substantially the full term of the asset or liability including the following:
|
a.
|
quoted prices for similar, but not identical, instruments in active markets;
|
b.
|
quoted prices for identical or similar instruments in markets that are not active;
|
c.
|
inputs other than quoted prices that are observable for the instrument; or
|
d.
|
inputs that are derived principally from or corroborated by observable market data by correlation or other means.
|
·
|
Level 3 valuations are based on information that is unobservable and significant to the overall fair value measurement.
|
Increase in
|
||||||||||||||||
AUGUST 31,
|
2017
|
Fair Value
|
Payments
|
2018
|
||||||||||||
RGP Acquisition
|
$
|
913
|
$
|
693
|
$
|
(1,000
|
)
|
$
|
606
|
|||||||
Jhana Acquisition
|
6,052
|
321
|
(2,431
|
)
|
3,942
|
|||||||||||
$
|
6,965
|
$
|
1,014
|
$
|
(3,431
|
)
|
$
|
4,548
|
Likely
|
Minimum
|
Maximum
|
|||||||
RGP growth rate - Year 1
|
14.8
|
%
|
(12.0)
|
%
|
35.0
|
%
|
|||
RGP growth rate - Year 2
|
10.0
|
%
|
(12.0)
|
%
|
35.0
|
%
|
|||
RGP growth rate - Year 3
|
10.0
|
%
|
(12.0)
|
%
|
35.0
|
%
|
|||
Add-on services growth rate - Year 1
|
60.0
|
%
|
(20.0)
|
%
|
130.0
|
%
|
|||
Add-on services growth rate - Year 2
|
50.0
|
%
|
(20.0)
|
%
|
130.0
|
%
|
|||
Add-on services growth rate - Year 3
|
40.0
|
%
|
(20.0)
|
%
|
130.0
|
%
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Performance awards
|
$
|
2,034
|
$
|
2,902
|
$
|
2,492
|
||||||
Unvested stock awards
|
642
|
500
|
450
|
|||||||||
Fully vested stock awards
|
15
|
135
|
60
|
|||||||||
Compensation cost of the ESPP
|
155
|
121
|
119
|
|||||||||
$
|
2,846
|
$
|
3,658
|
$
|
3,121
|
Weighted-
|
||||||||
Average Grant-
|
||||||||
Date Fair
|
||||||||
Number of
|
Value Per
|
|||||||
Shares
|
Share
|
|||||||
Unvested stock awards at
|
||||||||
August 31, 2017
|
29,834
|
$
|
17.60
|
|||||
Granted
|
23,338
|
30.00
|
||||||
Forfeited
|
-
|
-
|
||||||
Vested
|
(29,834
|
)
|
17.60
|
|||||
Unvested stock awards at
|
||||||||
August 31, 2018
|
23,338
|
$
|
30.00
|
Weighted
|
||||||||||||||||
Weighted
|
Average
|
|||||||||||||||
Avg. Exercise
|
Remaining
|
Aggregate
|
||||||||||||||
Number of
|
Price Per
|
Contractual
|
Intrinsic Value
|
|||||||||||||
Stock Options
|
Share
|
Life (Years)
|
(thousands)
|
|||||||||||||
Outstanding at August 31, 2017
|
568,750
|
$
|
11.67
|
|||||||||||||
Granted
|
-
|
-
|
||||||||||||||
Exercised
|
-
|
-
|
||||||||||||||
Forfeited
|
-
|
-
|
||||||||||||||
Outstanding at August 31, 2018
|
568,750
|
$
|
11.67
|
1.8
|
$
|
7,923
|
||||||||||
Options vested and exercisable at
|
||||||||||||||||
August 31, 2018
|
568,750
|
$
|
11.67
|
1.8
|
$
|
7,923
|
Weighted
|
||||||||||||||||||||||
Number
|
Average
|
Options
|
||||||||||||||||||||
Outstanding
|
Remaining
|
Weighted
|
Exercisable at
|
Weighted
|
||||||||||||||||||
at August 31,
|
Contractual
|
Average
|
August 31,
|
Average
|
||||||||||||||||||
Exercise Prices
|
2018
|
Life (Years)
|
Exercise Price
|
2018
|
Exercise Price
|
|||||||||||||||||
$
|
9.00
|
62,500
|
2.4
|
$
|
9.00
|
62,500
|
$
|
9.00
|
||||||||||||||
$
|
10.00
|
168,750
|
1.8
|
$
|
10.00
|
168,750
|
$
|
10.00
|
||||||||||||||
$
|
12.00
|
168,750
|
1.8
|
$
|
12.00
|
168,750
|
$
|
12.00
|
||||||||||||||
$
|
14.00
|
168,750
|
1.8
|
$
|
14.00
|
168,750
|
$
|
14.00
|
||||||||||||||
568,750
|
568,750
|
12. |
CONTRACT TERMINATION AND RESTRUCTURING COSTS
|
Description
|
Amount
|
|||
Severance costs
|
$
|
986
|
||
Office closure costs
|
496
|
|||
$
|
1,482
|
13. |
EMPLOYEE BENEFIT PLANS
|
14. |
INCOME TAXES
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Current:
|
||||||||||||
Federal
|
$
|
29
|
$
|
69
|
$
|
(380
|
)
|
|||||
State
|
210
|
(71
|
)
|
(197
|
)
|
|||||||
Foreign
|
(2,947
|
)
|
(2,320
|
)
|
(2,553
|
)
|
||||||
(2,708
|
)
|
(2,322
|
)
|
(3,130
|
)
|
|||||||
Deferred:
|
||||||||||||
Federal
|
1,426
|
(1,227
|
)
|
(1,584
|
)
|
|||||||
State
|
(314
|
)
|
(17
|
)
|
70
|
|||||||
Foreign
|
(281
|
)
|
468
|
50
|
||||||||
Operating loss carryforward
|
2,636
|
6,964
|
-
|
|||||||||
Adjustment for changes in U.S.
|
||||||||||||
income tax rates
|
1,654
|
-
|
-
|
|||||||||
Valuation allowance
|
(2,780
|
)
|
(129
|
)
|
(301
|
)
|
||||||
2,341
|
6,059
|
(1,765
|
)
|
|||||||||
$
|
(367
|
)
|
$
|
3,737
|
$
|
(4,895
|
)
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Net income (loss)
|
$
|
(367
|
)
|
$
|
3,737
|
$
|
(4,895
|
)
|
||||
Other comprehensive income
|
(75
|
)
|
37
|
115
|
||||||||
$
|
(442
|
)
|
$
|
3,774
|
$
|
(4,780
|
)
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
United States
|
$
|
(8,960
|
)
|
$
|
(10,126
|
)
|
$
|
9,328
|
||||
Foreign
|
3,440
|
(783
|
)
|
2,583
|
||||||||
$
|
(5,520
|
)
|
$
|
(10,909
|
)
|
$
|
11,911
|
YEAR ENDED
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Federal statutory income tax rate
|
25.7
|
%
|
35.0
|
%
|
(35.0
|
)%
|
||||||
State income taxes, net of federal effect
|
2.6
|
2.3
|
(1.9
|
)
|
||||||||
Effect of change in U.S. federal tax rate
|
30.0
|
-
|
-
|
|||||||||
Valuation allowance
|
(50.4
|
)
|
(1.2
|
)
|
(2.5
|
)
|
||||||
Foreign jurisdictions tax differential
|
(6.8
|
)
|
(1.9
|
)
|
0.6
|
|||||||
Tax differential on income subject to both U.S. and foreign taxes
|
2.3
|
0.4
|
(1.9
|
)
|
||||||||
Uncertain tax positions
|
(5.1
|
)
|
4.4
|
0.4
|
||||||||
Non-deductible executive compensation
|
(2.7
|
)
|
(1.6
|
)
|
-
|
|||||||
Non-deductible meals and entertainment
|
(8.9
|
)
|
(2.2
|
)
|
(1.6
|
)
|
||||||
Payout of deferred compensation (NQDC)
|
4.4
|
-
|
-
|
|||||||||
Other
|
2.2
|
(0.9
|
)
|
0.8
|
||||||||
(6.7
|
)%
|
34.3
|
%
|
(41.1
|
)%
|
AUGUST 31,
|
2018
|
2017
|
||||||
Deferred income tax assets:
|
||||||||
Net operating loss carryforward
|
$
|
9,039
|
$
|
10,310
|
||||
Sale and financing of corporate
|
||||||||
headquarters
|
4,919
|
8,420
|
||||||
Foreign income tax credit
|
||||||||
carryforward
|
6,562
|
4,382
|
||||||
Stock-based compensation
|
1,174
|
2,954
|
||||||
Inventory and bad debt reserves
|
1,046
|
1,643
|
||||||
Bonus and other accruals
|
1,511
|
1,574
|
||||||
Deferred revenue
|
236
|
510
|
||||||
Other
|
323
|
337
|
||||||
Total deferred income tax assets
|
24,810
|
30,130
|
||||||
Less: valuation allowance
|
(3,397
|
)
|
(612
|
)
|
||||
Net deferred income tax assets
|
21,413
|
29,518
|
||||||
Deferred income tax liabilities:
|
||||||||
Intangibles step-ups – indefinite lived
|
(5,427
|
)
|
(8,539
|
)
|
||||
Intangibles step-ups – finite lived
|
(4,103
|
)
|
(7,607
|
)
|
||||
Intangible asset impairment and
|
||||||||
amortization
|
(3,023
|
)
|
(4,875
|
)
|
||||
Property and equipment depreciation
|
(3,518
|
)
|
(4,960
|
)
|
||||
Deferred commissions
|
(1,596
|
)
|
(2,195
|
)
|
||||
Unremitted earnings of foreign
|
||||||||
subsidiaries
|
(380
|
)
|
(492
|
)
|
||||
Other
|
(354
|
)
|
(236
|
)
|
||||
Total deferred income tax liabilities
|
(18,401
|
)
|
(28,904
|
)
|
||||
Net deferred income taxes
|
$
|
3,012
|
$
|
614
|
AUGUST 31,
|
2018
|
2017
|
||||||
Long-term assets
|
$
|
3,222
|
$
|
1,647
|
||||
Long-term liabilities
|
(210
|
)
|
(1,033
|
)
|
||||
Net deferred income tax asset
|
$
|
3,012
|
$
|
614
|
Loss Carryforward
|
Loss
|
Loss
|
Operating
|
||||||||||||||
Loss Carryforward
|
Expires
|
Deductions
|
Deductions
|
Loss Carried
|
|||||||||||||
for Year Ended
|
August 31,
|
Amount
|
in Prior Years
|
in Current Year
|
Forward
|
||||||||||||
December 31, 2012
|
2031
|
$
|
243
|
$
|
-
|
$
|
-
|
$
|
243
|
||||||||
December 31, 2013
|
2032
|
553
|
-
|
-
|
553
|
||||||||||||
December 31, 2014
|
2033
|
1,285
|
-
|
-
|
1,285
|
||||||||||||
December 31, 2015
|
2034
|
1,491
|
-
|
-
|
1,491
|
||||||||||||
December 31, 2016
|
2035
|
3,052
|
-
|
-
|
3,052
|
||||||||||||
July 15, 2017 Acquired NOL
|
2036
|
1,117
|
-
|
-
|
1,117
|
||||||||||||
|
7,741
|
-
|
-
|
7,741
|
|||||||||||||
August 31, 2017
|
2037
|
16,381
|
-
|
-
|
16,381
|
||||||||||||
August 31, 2018
|
No expiration
|
9,677
|
-
|
-
|
9,677
|
||||||||||||
$
|
33,799
|
$
|
-
|
$
|
-
|
$
|
33,799
|
Credit Generated in
|
Credits Used
|
Credits Used
|
Credits
|
||||||||||||||
Fiscal Year Ended
|
Credit Expires
|
Credits
|
in Prior
|
in Fiscal
|
Carried
|
||||||||||||
August 31,
|
August 31,
|
Generated
|
Years
|
2018
|
Forward
|
||||||||||||
2011
|
2021
|
$
|
3,445
|
$
|
(414
|
)
|
$
|
-
|
$
|
3,031
|
|||||||
2012
|
2022
|
2,563
|
(2,563
|
)
|
-
|
-
|
|||||||||||
2013
|
2023
|
2,815
|
(2,815
|
)
|
-
|
-
|
|||||||||||
2014
|
2024
|
1,378
|
(1,378
|
)
|
-
|
-
|
|||||||||||
2015
|
2025
|
1,422
|
(1,422
|
)
|
-
|
-
|
|||||||||||
2016
|
2026
|
1,569
|
(1,569
|
)
|
-
|
-
|
|||||||||||
2017
|
2027
|
1,804
|
-
|
-
|
1,804
|
||||||||||||
2018
|
2028
|
1,727
|
-
|
- |
1,727
|
||||||||||||
$
|
16,723
|
$
|
(10,161
|
)
|
$
|
-
|
$
|
6,562
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Beginning balance
|
$
|
2,359
|
$
|
3,024
|
$
|
3,115
|
||||||
Additions based on tax positions
|
||||||||||||
related to the current year
|
27
|
10
|
199
|
|||||||||
Additions for tax positions in
|
||||||||||||
prior years
|
367
|
85
|
3
|
|||||||||
Reductions for tax positions of prior
|
||||||||||||
years resulting from the lapse of
|
||||||||||||
applicable statute of limitations
|
(253
|
)
|
(634
|
)
|
(212
|
)
|
||||||
Other reductions for tax positions of
|
||||||||||||
prior years
|
(389
|
)
|
(126
|
)
|
(81
|
)
|
||||||
Ending balance
|
$
|
2,111
|
$
|
2,359
|
$
|
3,024
|
2011-2018
|
Canada and Australia
|
2013-2018
|
Japan and the United Kingdom
|
2014-2018
|
United States – state and local income tax
|
2015-2018
|
United States – federal income tax
|
2016-2018
|
China
|
2017-2018
|
Singapore
|
15. |
EARNINGS (LOSS) PER SHARE
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Numerator for basic and
|
||||||||||||
diluted earnings per share:
|
||||||||||||
Net income (loss)
|
$
|
(5,887
|
)
|
$
|
(7,172
|
)
|
$
|
7,016
|
||||
Denominator for basic and
|
||||||||||||
diluted earnings per share:
|
||||||||||||
Basic weighted average shares
|
||||||||||||
outstanding
|
13,849
|
13,819
|
14,944
|
|||||||||
Effect of dilutive securities:
|
||||||||||||
Stock options and other
|
||||||||||||
stock-based awards
|
-
|
-
|
132
|
|||||||||
Diluted weighted average shares
|
||||||||||||
outstanding
|
13,849
|
13,819
|
15,076
|
|||||||||
EPS Calculations:
|
||||||||||||
Net income (loss) per share:
|
||||||||||||
Basic and diluted
|
$
|
(0.43
|
)
|
$
|
(0.52
|
)
|
$
|
0.47
|
16. |
SEGMENT INFORMATION
|
·
|
Direct Offices – This segment includes our sales personnel that serve the United States and Canada; our international sales offices located in Japan, China, the United Kingdom, and Australia; our governmental sales channel; and our public program operations.
|
·
|
Education Practice – This group includes our domestic and international Education practice operations, which are focused on sales to educational institutions.
|
·
|
International Licensees – This segment is primarily comprised of our international licensees' royalty revenues.
|
·
|
Corporate and Other – Our corporate and other information includes leasing operations, shipping and handling revenues, and certain corporate administrative expenses.
|
Sales to
|
||||||||||||
Fiscal Year Ended
|
External
|
Adjusted
|
||||||||||
August 31, 2018
|
Customers
|
Gross Profit
|
EBITDA
|
|||||||||
Direct offices
|
$
|
145,890
|
$
|
108,140
|
$
|
15,773
|
||||||
Education practice
|
45,272
|
28,654
|
3,606
|
|||||||||
International licensees
|
13,226
|
10,031
|
5,087
|
|||||||||
Total
|
204,388
|
146,825
|
24,466
|
|||||||||
Corporate and eliminations
|
5,370
|
1,464
|
(12,588
|
)
|
||||||||
Consolidated
|
$
|
209,758
|
$
|
148,289
|
$
|
11,878
|
||||||
Fiscal Year Ended
|
||||||||||||
August 31, 2017
|
||||||||||||
Direct offices
|
$
|
122,309
|
$
|
81,700
|
$
|
4,242
|
||||||
Education practice
|
44,122
|
27,916
|
7,195
|
|||||||||
International licensees
|
13,571
|
10,483
|
6,415
|
|||||||||
Total
|
180,002
|
120,099
|
17,852
|
|||||||||
Corporate and eliminations
|
5,254
|
2,568
|
(10,153
|
)
|
||||||||
Consolidated
|
$
|
185,256
|
$
|
122,667
|
$
|
7,699
|
||||||
Fiscal Year Ended
|
||||||||||||
August 31, 2016
|
||||||||||||
Direct offices
|
$
|
135,954
|
$
|
95,211
|
$
|
20,610
|
||||||
Education practice
|
40,844
|
24,513
|
5,188
|
|||||||||
International licensees
|
17,113
|
13,152
|
9,268
|
|||||||||
Total
|
193,911
|
132,876
|
35,066
|
|||||||||
Corporate and eliminations
|
6,144
|
2,278
|
(8,172
|
)
|
||||||||
Consolidated
|
$
|
200,055
|
$
|
135,154
|
$
|
26,894
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
Segment Adjusted EBITDA
|
$
|
24,466
|
$
|
17,852
|
$
|
35,066
|
||||||
Corporate expenses
|
(12,588
|
)
|
(10,153
|
)
|
(8,172
|
)
|
||||||
Consolidated Adjusted EBITDA
|
11,878
|
7,699
|
26,894
|
|||||||||
Stock-based compensation
|
(2,846
|
)
|
(3,658
|
)
|
(3,121
|
)
|
||||||
Reduction (increase) in
|
||||||||||||
contingent consideration liabilities
|
(1,014
|
)
|
1,936
|
(1,538
|
)
|
|||||||
Costs to exit Japan publishing business
|
-
|
(2,107
|
)
|
-
|
||||||||
Contract termination costs
|
-
|
(1,500
|
)
|
-
|
||||||||
Restructuring costs
|
-
|
(1,482
|
)
|
(776
|
)
|
|||||||
ERP system implementation costs
|
(855
|
)
|
(1,404
|
)
|
(448
|
)
|
||||||
China office start-up costs
|
-
|
(505
|
)
|
(222
|
)
|
|||||||
Business acquisition costs
|
-
|
(442
|
)
|
-
|
||||||||
Depreciation
|
(5,161
|
)
|
(3,879
|
)
|
(3,677
|
)
|
||||||
Amortization
|
(5,368
|
)
|
(3,538
|
)
|
(3,263
|
)
|
||||||
Income (loss) from operations
|
(3,366
|
)
|
(8,880
|
)
|
13,849
|
|||||||
Interest income
|
104
|
223
|
115
|
|||||||||
Interest expense
|
(2,676
|
)
|
(2,408
|
)
|
(2,263
|
)
|
||||||
Accretion of discount on related
|
||||||||||||
party receivable
|
418
|
156
|
210
|
|||||||||
Income (loss) before income taxes
|
(5,520
|
)
|
(10,909
|
)
|
11,911
|
|||||||
Benefit (provision) for income taxes
|
(367
|
)
|
3,737
|
(4,895
|
)
|
|||||||
Net income (loss)
|
$
|
(5,887
|
)
|
$
|
(7,172
|
)
|
$
|
7,016
|
YEAR ENDED
|
||||||||||||
AUGUST 31,
|
2018
|
2017
|
2016
|
|||||||||
United States
|
$
|
151,022
|
$
|
136,206
|
$
|
155,153
|
||||||
Japan
|
15,670
|
14,482
|
14,997
|
|||||||||
China
|
14,176
|
11,552
|
3,884
|
|||||||||
United Kingdom
|
7,411
|
4,754
|
7,716
|
|||||||||
Canada
|
4,722
|
4,372
|
4,357
|
|||||||||
Australia
|
4,148
|
2,704
|
3,404
|
|||||||||
Western Europe
|
2,016
|
1,679
|
1,503
|
|||||||||
Brazil
|
1,285
|
1,423
|
319
|
|||||||||
Thailand
|
1,219
|
1,147
|
1,226
|
|||||||||
Mexico/Central America
|
872
|
751
|
917
|
|||||||||
Singapore
|
865
|
722
|
1,143
|
|||||||||
Middle East
|
840
|
723
|
584
|
|||||||||
Central/Eastern Europe
|
757
|
638
|
644
|
|||||||||
Denmark/Scandinavia
|
752
|
775
|
863
|
|||||||||
Indonesia
|
715
|
614
|
579
|
|||||||||
India
|
647
|
701
|
677
|
|||||||||
The Philippines
|
353
|
324
|
332
|
|||||||||
Malaysia
|
338
|
364
|
384
|
|||||||||
Others
|
1,950
|
1,325
|
1,373
|
|||||||||
$
|
209,758
|
$
|
185,256
|
$
|
200,055
|
AUGUST 31,
|
2018
|
2017
|
||||||
United States/Canada
|
$
|
34,237
|
$
|
33,146
|
||||
Japan
|
1,450
|
2,350
|
||||||
China
|
581
|
301
|
||||||
Singapore
|
315
|
152
|
||||||
United Kingdom
|
276
|
240
|
||||||
Australia
|
250
|
466
|
||||||
$
|
37,109
|
$
|
36,655
|
17. |
RELATED PARTY TRANSACTIONS
|
AUGUST 31,
|
2018
|
2017
|
||||||
Other current assets
|
$
|
1,123
|
$
|
1,020
|
||||
Other long-term assets
|
411
|
727
|
||||||
$
|
1,534
|
$
|
1,747
|
1.
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
|
2.
|
provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with the authorization of management and/or of our Board of Directors; and
|
3.
|
provide reasonable assurance regarding the prevention or timely detection of any unauthorized acquisition, use, or disposition of our assets that could have a material effect on our financial statements.
|
[a] | [b] | [c] | ||||||||||
Plan Category
|
Number of securities to be issued upon exercise of outstanding options, warrants, and rights
|
Weighted-average exercise price of outstanding options, warrants, and rights
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column [a])
|
|||||||||
(in thousands)
|
(in thousands)
|
|||||||||||
Equity compensation plans approved by security holders
|
1,129
|
(1)(2)
|
$
|
11.67
|
1,200
|
(3)(4)
|
(1) |
Excludes 23,338 shares of unvested (restricted) stock awards that are subject to forfeiture.
|
(2) |
Amount includes 790,143 performance share awards that may be awarded under the terms of various long-term incentive plans. The number of shares eventually awarded to participants through our long-term incentive plans is variable and based upon the achievement of specified financial goals. For performance-based compensation awards where the number of shares may fluctuate within a range based on the achievement of the specified goal, this amount includes the maximum number of shares that may be awarded to participants. The actual number of shares issued to participants therefore, may be less than the amount disclosed. The weighted average exercise price of outstanding options, warrants, and rights does not include the impact of performance awards or restricted stock units. For further information on our stock-based compensation plans, refer to the notes to our financial statements as presented in Item 8 of this report.
|
(3) |
Amount is comprised of the remaining shares authorized in our 2015 Omnibus Incentive Plan and 2017 Employee Stock Purchase Plan. The number of performance-based plan shares expected to be awarded at August 31, 2018 may change in future periods based upon the achievement of specified goals and revisions to estimates.
|
(4) |
At August 31, 2018, we had approximately 946,000 shares authorized for purchase by participants in our Employee Stock Purchase Plan.
|
1.
|
Financial Statements. The consolidated financial statements of the Company and Report of Independent Registered Public Accounting Firm thereon included in the Annual Report to Shareholders on Form 10-K for the year ended August 31, 2018, are as follows:
|
2.
|
Financial Statement Schedules.
|
3.
|
Exhibit List.
|
Exhibit No.
|
Exhibit
|
Incorporated By Reference
|
Filed Herewith
|
2.1
|
(8)
|
||
2.2
|
(9)
|
||
3.1
|
(4)
|
||
3.2
|
(7)
|
||
3.3
|
(15)
|
||
4.1
|
Specimen Certificate of the Registrant's Common Stock, par value $.05 per share
|
(2)
|
4.2
|
(3)
|
||
4.3
|
(3)
|
||
4.4
|
(4)
|
||
4.5
|
(4)
|
||
10.1*
|
Forms of Nonstatutory Stock Options
|
(1)
|
|
10.2
|
(5)
|
||
10.3
|
(5)
|
||
10.4
|
(6)
|
||
10.5
|
(10)
|
||
10.6
|
(10)
|
||
10.7
|
(10)
|
||
10.8
|
(10)
|
||
10.9
|
(10)
|
||
10.10
|
(11)
|
||
10.11
|
(11)
|
||
10.12*
|
(12)
|
||
10.13
|
(13)
|
||
10.14
|
(13)
|
10.15
|
(13)
|
||
10.16
|
(14)
|
||
10.17
|
(16)
|
||
10.18
|
(17)
|
||
10.19*
|
(18)
|
||
10.20
|
(19)
|
||
10.21
|
(20)
|
||
10.22*
|
(21)
|
||
10.23
|
(22)
|
||
10.24
|
(23)
|
||
10.25
|
(23)
|
||
10.26
|
(24)
|
||
10.27
|
(25)
|
||
10.28
|
(26)
|
||
10.29
|
(26)
|
||
10.30*
|
(27)
|
10.31
|
(28)
|
||
21
|
éé
|
||
23
|
éé
|
||
31.1
|
éé
|
||
31.2
|
éé
|
||
32
|
éé
|
||
101.INS
|
XBRL Instance Document
|
éé
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
éé
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
éé
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
éé
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
éé
|
|
101.PRE
|
XBRL Extension Presentation Linkbase
|
éé
|
(1)
|
Incorporated by reference to Registration Statement on Form S-1 filed with the Commission on April 17, 1992, Registration No. 33-47283.
|
(2)
|
Incorporated by reference to Amendment No. 1 to Registration Statement on Form S-1 filed with the Commission on May 26, 1992, Registration No. 33-47283.
|
(3)
|
Incorporated by reference to Schedule 13D (CUSIP No. 534691090 as filed with the Commission on June 14, 1999). Registration No. 005-43123.
|
(4)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 10, 2005.**
|
(5)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on June 27, 2005.**
|
(6)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on October 24, 2005.**
|
(7)
|
Incorporated by reference to the Definitive Proxy Statement on Form DEF 14A filed with the Commission on December 12, 2005.**
|
(8)
|
Incorporated by reference to Report on Form 8-K/A filed with the Commission on May 29, 2008.**
|
(9)
|
Incorporated by reference to Report on Form 10-Q filed July 10, 2008, for the Quarter ended May 31, 2008.**
|
(10)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on July 11, 2008.**
|
(11)
|
Incorporated by reference to Report on Form 10-Q filed with the Commission on April 9, 2009.**
|
(12)
|
Incorporated by reference to the Definitive Proxy Statement on Form DEF 14A (Appendix A) filed with the Commission on December 15, 2010.**
|
(13)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 17, 2011.**
|
(14)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on July 28, 2011.**
|
(15)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on February 1, 2012.**
|
(16)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 15, 2012.**
|
(17)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on June 19, 2012.**
|
(18)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 14, 2012.**
|
(19)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 14, 2013.**
|
(20)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 27, 2013.**
|
(21)
|
Incorporated by reference to the Definitive Proxy Statement on Form DEF 14A (Appendix A) filed with the Commission on December 22, 2014.**
|
(22)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on April 2, 2015.**
|
(23)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on May 24, 2016.**
|
(24)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on March 3, 2017.**
|
(25)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on June 1, 2017.**
|
(26)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on August 29, 2017.**
|
(27)
|
Incorporated by reference to the Definitive Proxy Statement on Form DEF 14A (Appendix A) filed with the Commission on December 22, 2017.**
|
(28)
|
Incorporated by reference to Report on Form 8-K filed with the Commission on August 20, 2018.**
|
|
By:
|
/s/ Robert A. Whitman
|
|
|
Robert A. Whitman
Chairman and Chief Executive Officer
|
Signature
|
Title
|
Date
|
/s/ Robert A. Whitman
|
Chairman of the Board
and Chief Executive Officer
|
November 14, 2018
|
Robert A. Whitman
|
||
/s/ Anne Chow
|
Director
|
November 14, 2018
|
Anne Chow
|
||
/s/ Clayton M. Christensen
|
Director
|
November 14, 2018
|
Clayton M. Christensen
|
||
/s/ Michael Fung
|
Director
|
November 14, 2018
|
Michael Fung
|
||
/s/ Dennis G. Heiner
|
Director
|
November 14, 2018
|
Dennis G. Heiner
|
||
/s/ Donald J. McNamara
|
Director
|
November 14, 2018
|
Donald J. McNamara
|
||
/s/ Joel C. Peterson
|
Director
|
November 14, 2018
|
Joel C. Peterson
|
||
/s/ E. Kay Stepp
|
Director
|
November 14, 2018
|
E. Kay Stepp
|
||
/s/ Stephen D. Young
|
Chief Financial Officer
and Chief Accounting Officer
|
November 14, 2018
|
Stephen D. Young
|
1.
|
I have reviewed this yearly report on Form 10-K of Franklin Covey Co.;
|
||
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:
|
||
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
||
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):
|
||
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
|
|
|
Date: November 14, 2018
|
/s/ Robert A. Whitman
|
|
|
Robert A. Whitman
Chief Executive Officer
|
1.
|
I have reviewed this yearly report on Form 10-K of Franklin Covey Co.;
|
||
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:
|
||
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
||
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
||
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):
|
||
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
|
|
|
|
Date November 14, 2018
|
/s/ Stephen D. Young
|
|
|
Stephen D. Young
Chief Financial Officer
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company at the dates and for the periods indicated.
|
|
|
|
|
|
|||
/s/ Robert A. Whitman
|
|
/s/ Stephen D. Young
|
|
Robert A. Whitman
Chief Executive Officer |
|
|
Stephen D. Young
Chief Financial Officer |
Date: November 14, 2018
|
Date: November 14, 2018
|
:=;MT]5:"0']1S^%*HZM-7G&PH
MTL&]JWX'L#:OIBG#:C: CJ#.O^-1'Q#HH)!UC3P1U!N4_P :\DD\,6L8XU4R
M-_L6QQ^K#^50+X>C#?- 6NH6D=W97,-S;2#*30R!T8=.".#7/\ Q O-7TWP5J>HZ-?0
MV=S:0/,7DMO.)"@G"Y8 'W(8>U1:V_C9Y;5_",OAN73FMU)DU)IF=VYY4Q\%
M2NWGZTSQV;D?"C7#?F$7?]ER";R<^7OV<[<\XSTSS0!N:+=7-YX8T^[-@>3+#COQZYK
MU-?!OAU5P-*@_')_K6!JGPSM[W49+BTOELH7"[8%M]P7 Z[AUQG\:;P:M:Q
MO3>7MVE%KUO^AQ=OXBO4N8VTZ!EO.1&5^<\@@_+CG@FM)?#/C'Q&P>_>9(R<
MYNY2H'T3J/RKH-.^%]G;7\
FQ?+'Y\?SK%NHY8;N2*X8M*APQ)SS]:PJXM*/N0^;.5XNM?FYG?U.GT[_A$
MM!E-UIZ>5-)'M.UI'.TX..20.0*GF\:6B_ZFVFD_WB%']:Q?#NF66J3S17)E
MWHH90A !'0YX^E=;#X>TJ#&VS1CZN2W\ZJE+$58WA9(SE.=1\TG
02 DG)#(NT\XQS5KP)_R3SPS_P!@
MJU_]%+704 >>MX$U2#0M0\)V%Q:1>'KZ9W\\NWVBVB<[GA2/;M;)R Q88#?=
M..=?4O"LL&M:5KF@I;K>Z=;&R^SW$C)'/;G&%+A6*E2,@[3W'?(ZNB@#G?#'
MAV;1O[4O[N:*;5=5N/M-RT8/EH0H58USR54#&2 3R<#H*>H^&]6\4>$(K/7Y
MK"WUJ&X6Y@N+!7:&*5&S&P#\GC@CW.*ZZB@#E;'P_J5[XK@\1Z\+.*XL[9K:
MTM;.5I43?@O(794)8XP%VX '4YXJ2^%M8TN_UP^'I;%+77'\V8W+LK6S+&"TB$:LW5O5C[DY/XUI444 9
MGB339=9\+:OI<#HDU[936\;2$[0SH5!..<9-84?@411+&FH850 /W'_V5=A1
M652C"K;G5P>JL8^AZ"-&>X?S_.:<("=FW&W=[G^]6Q115PA&$>6.P!1115 %
M%%% !1110 4444 %%%% !1110 4444 %9GAO39=&\+:1I<[H\UE90V\C1D[2
MR(%)&><9%:=% !1110 4444 %%%% !1110 4444 %%%% !1110 4444 %9FE
MZ;+8ZCK=Q(Z,M_>K<1A2
G)E4WI.5&-Z:V,Y
M9"(_/@T*/'@Z>&UP;65T82!X;6QN H*.'6O.PF5T,70_
Document And Entity Information - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Oct. 31, 2018 |
Feb. 28, 2018 |
|
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Aug. 31, 2018 | ||
Amendment Flag | false | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2018 | ||
Entity Registrant Name | FRANKLIN COVEY CO | ||
Entity Central Index Key | 0000886206 | ||
Current Fiscal Year End Date | --08-31 | ||
Entity Filer Category | Accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Trading Symbol | fc | ||
Entity Common Stock, Shares Outstanding | 13,918,219 | ||
Entity Public Float | $ 172.6 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts | $ 3,555 | $ 2,310 |
Common stock, par value | $ 0.05 | $ 0.05 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 27,056,000 | 27,056,000 |
Treasury stock, shares | 13,159,000 | 13,414,000 |
Consolidated Statements Of Operations And Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Consolidated Statements Of Operations And Comprehensive Income (Loss) [Abstract] | |||
Foreign currency translation adjustments, tax | $ (75) | $ 37 | $ 115 |
Nature Of Operations And Summary Of Significant Accounting Policies |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nature Of Operations And Summary Of Significant Accounting Policies | Franklin Covey Co. (hereafter referred to as we, us, our, or the Company) is a global company specializing in organizational performance improvement. We help individuals and organizations achieve results that require a change in human behavior and our mission is to “enable greatness in people and organizations everywhere.” We have some of the best-known offerings in the training industry, including a suite of individual-effectiveness and leadership-development training and products based on the best-selling books, The 7 Habits of Highly Effective People, The Speed of Trust, The Leader In Me, and The Four Disciplines of Execution, and proprietary content in the areas of Execution, Sales Performance, Productivity, Customer Loyalty, and Educational improvement. Our offerings are described in further detail at www.franklincovey.com and elsewhere in this report. Through our organizational research and curriculum development efforts, we seek to consistently create, develop, and introduce new services and products that help individuals and organizations achieve their own great purposes. Fiscal Year Our fiscal year ends on August 31 of each year. During fiscal 2017, our Board of Directors approved a change to our fiscal quarter ending dates from a modified 52/53-week calendar in which quarterly periods ended on different dates from year to year, to the last day of the calendar month in each quarter. Beginning with the second quarter of fiscal 2017, our fiscal quarters now end on the last day of November, February, and May. Unless otherwise noted, references to fiscal years apply to the 12 months ended August 31 of the specified year. Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries, which consist of Franklin Development Corp., and our offices in Japan, China, the United Kingdom, and Australia. Intercompany balances and transactions are eliminated in consolidation. Pervasiveness of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Reclassifications Certain reclassifications have been made to our prior period financial statements to conform with the current period presentation. On our consolidated balance sheet, we have separately classified deferred income tax assets and combined amounts receivable from FC Organizational Products (FCOP) with other current and other long-term assets (Note 17). On our consolidated statements of operations, we reclassified $0.2 million in each of the fiscal years ended August 31, 2017 and 2016 from interest income to the accretion of discount on related party receivables. Cash and Cash Equivalents Some of our cash is deposited with financial institutions located throughout the United States of America and at banks in foreign countries where we operate subsidiary offices, and at times may exceed insured limits. We consider all highly liquid debt instruments with a maturity date of three months or less to be cash equivalents. We did not hold a significant amount of investments that would be considered cash equivalent instruments at August 31, 2018 or 2017. Of our $10.2 million in cash at August 31, 2018, $8.9 million of it was held outside the U.S. by our foreign subsidiaries. We routinely repatriate cash from our foreign subsidiaries and consider cash generated from foreign activities a key component of our overall liquidity position. Inventories Inventories are stated at the lower of cost or net realizable value, cost being determined using the first-in, first-out method. Elements of cost in inventories generally include raw materials and direct labor. Cash flows from the sale of inventory are included in cash flows provided by operating activities in our consolidated statements of cash flows. Our inventories are comprised primarily of training materials, books, and training-related accessories, and consisted of the following (in thousands):
Provision is made to reduce excess and obsolete inventories to their estimated net realizable value. In assessing the valuation of inventories, we make judgments regarding future demand requirements and compare these estimates with current and committed inventory levels. Inventory requirements may change based on projected customer demand, training curriculum life-cycle changes, and other factors that could affect the valuation of our inventories. During fiscal 2017, we exited the publishing business in Japan (Note 12) and wrote off the majority of our book inventory located in Japan, which totaled $2.1 million. The cost of the books written off was recorded in cost of sales during fiscal 2017. Other Current Assets Significant components of our other current assets were as follows (in thousands):
We defer commission expense on subscription-based sales and recognize the commission expense with the recognition of the corresponding revenue. Property and Equipment Property and equipment are recorded at cost. Depreciation expense, which includes depreciation on our corporate campus that is accounted for as a financing obligation (Note 6), and the amortization of assets recorded under capital lease obligations, is calculated using the straight-line method over the lesser of the expected useful life of the asset or the contracted lease period. We generally use the following depreciable lives for our major classifications of property and equipment:
Our property and equipment were comprised of the following (in thousands):
We expense costs for repairs and maintenance as incurred. Gains and losses resulting from the sale of property and equipment are recorded in operating income (loss). Depreciation of capitalized portal costs is included in depreciation expense in the accompanying consolidated statements of operations. During each of the fiscal years ended August 31, 2018 and 2017, we capitalized $0.1 million of interest expense in connection with the installation of our new enterprise resource planning system and the development of our new All Access Pass portal. Impairment of Long-Lived Assets Long-lived tangible assets and finite-lived intangible assets are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We use an estimate of undiscounted future net cash flows of the assets over the remaining useful lives in determining whether the carrying value of the assets is recoverable. If the carrying values of the assets exceed the anticipated future cash flows of the assets, we recognize an impairment loss equal to the difference between the carrying values of the assets and their estimated fair values. Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash flows that are independent from other groups of assets. The evaluation of long-lived assets requires us to use estimates of future cash flows. If forecasts and assumptions used to support the realizability of our long-lived tangible and finite-lived intangible assets change in the future, significant impairment charges could result that would adversely affect our results of operations and financial condition. Indefinite-Lived Intangible Assets and Goodwill Impairment Testing Intangible assets that are deemed to have an indefinite life and acquired goodwill are not amortized, but rather are tested for impairment on an annual basis or more often if events or circumstances indicate that a potential impairment exists. The Covey trade name intangible asset has been deemed to have an indefinite life. This intangible asset is tested for impairment using qualitative factors or the present value of estimated royalties on trade name related revenues, which consist primarily of training seminars and work sessions, international licensee sales, and related products. Based on the fiscal 2018 evaluation of the Covey trade name, we believe the fair value of the Covey trade name substantially exceeds its carrying value. No impairment charges were recorded against the Covey trade name during the fiscal years ended August 31, 2018, 2017, or 2016. Goodwill is recorded when the purchase price for an acquisition exceeds the estimated fair value of the net tangible and identified intangible assets acquired. During August 2017, we adopted Accounting Standards Update (ASU) 2017-04, Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment. This guidance simplifies the subsequent measurement of goodwill and eliminates the two-step goodwill impairment test. Under the new guidance, an annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount, and an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and two-step goodwill impairment test. We tested goodwill for impairment at August 31, 2018 at the reporting unit level using a quantitative approach. The goodwill impairment testing process involves determining whether the estimated fair value of the reporting unit exceeds its respective book value. If the fair value exceeds the book value, goodwill of that reporting unit is not impaired. If the book value exceeds the fair value, an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. The estimated fair value of each reporting unit was calculated using a combination of the income approach (discounted cash flows) and the market approach (using market multiples derived from a set of companies with comparable market characteristics). On an interim basis, we consider whether events or circumstances are present that may lead to the determination that goodwill may be impaired. If, based on events or changing circumstances, we determine it is more likely than not that the fair value of a reporting unit does not exceed its carrying value, we would be required to test goodwill for impairment. Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, future economic and market conditions, and determination of appropriate market comparables. We base our fair value estimates on assumptions we believe to be reasonable, but that are unpredictable and inherently uncertain. Actual future results may differ from those estimates. In addition, we make certain judgments and assumptions in allocating shared assets and liabilities to determine the carrying values for each of our reporting units. The timing and frequency of our goodwill impairment tests are based on an ongoing assessment of events and circumstances that would indicate a possible impairment. Based on the results of our goodwill impairment testing, we determined that no impairment existed at either of August 31, 2018 or 2017 as each reporting unit’s estimated fair value exceeded its carrying value. We will continue to monitor our goodwill and intangible assets for impairment and conduct formal tests when impairment indicators are present. For more information regarding our intangible assets and goodwill, refer to Note 4. Capitalized Curriculum Development Costs During the normal course of business, we develop training courses and related materials that we sell to our clients. Capitalized curriculum development costs include certain expenditures to develop course materials such as video segments, course manuals, and other related materials. Our capitalized curriculum development spending in fiscal 2018, which totaled $3.0 million, was primarily for offerings related to the All Access Pass, including The Four Essential Roles of Leadership, and for various other offerings in our Education practice. Curriculum costs are capitalized when there is a major revision to an existing course that requires a significant re-write of the course materials. Costs incurred to maintain existing offerings are expensed when incurred. In addition, development costs incurred in the research and development of new offerings and software products to be sold, leased, or otherwise marketed are expensed as incurred until economic and technological feasibility has been established. Capitalized development costs are amortized over three- to five-year useful lives, which are based on numerous factors, including expected cycles of major changes to our content. Capitalized curriculum development costs are reported as a component of other long-term assets in our consolidated balance sheets and totaled $9.3 million and $11.6 million at August 31, 2018 and 2017. Amortization of capitalized curriculum development costs is reported as a component of cost of sales in the accompanying consolidated statements of operations. Accrued Liabilities Significant components of our accrued liabilities were as follows (in thousands):
Contingent Consideration Payments from Business Acquisitions Business acquisitions may include contingent consideration payments based on various future financial measures related to the acquired entity. Contingent consideration is required to be recognized at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the acquired company and estimated probabilities of achievement. Based on updated estimates and projections, the contingent consideration liabilities are adjusted at each reporting date to their estimated fair value. Changes in fair value subsequent to the acquisition date are reported in selling, general, and administrative expense in our consolidated statements of operations, and may have a material impact on our operating results. Variations in the fair value of contingent consideration liabilities may result from changes in discount periods or rates, changes in the timing and amount of earnings estimates, and changes in probability assumptions with respect to the likelihood of achieving various payment criteria. Foreign Currency Translation and Transactions The functional currencies of our foreign operations are the reported local currencies. Translation adjustments result from translating our foreign subsidiaries’ financial statements into United States dollars. The balance sheet accounts of our foreign subsidiaries are translated into United States dollars using the exchange rate in effect at the balance sheet dates. Revenues and expenses are translated using average exchange rates for each month during the fiscal year. The resulting translation differences are recorded as a component of accumulated other comprehensive income in shareholders’ equity. Foreign currency transaction losses totaled $0.5 million, $0.2 million, and $0.3 million for the fiscal years ended August 31, 2018, 2017, and 2016, respectively, and are included as a component of selling, general, and administrative expenses in our consolidated statements of operations. Sales Taxes We collect sales tax on qualifying transactions with customers based upon applicable sales tax rates in various jurisdictions. We account for sales taxes collected using the net method; accordingly, we do not include sales taxes in net sales reported in our consolidated statements of operations. Revenue Recognition We recognize revenue when: 1) persuasive evidence of an arrangement exists, 2) delivery of the product has occurred or services have been rendered, 3) the price to the customer is fixed or determinable, and 4) collectability is reasonably assured. For training and service sales, these conditions are generally met upon presentation of the training seminar or delivery of the consulting services based upon daily rates. For most of our product sales, these conditions are met upon shipment of the product to the customer. At times, our customers may request access to our intellectual property for the flexibility to print certain training materials or to have access to certain training videos and other training aids at their convenience. For intellectual property license sales, the revenue recognition conditions are generally met at the later of delivery of the content to the client or the effective date of the arrangement. Revenue recognition for multiple-element arrangements requires judgment to determine if multiple elements exist, whether elements can be accounted for as separate units of accounting, and if so, the fair value for each of the elements. A deliverable constitutes a separate unit of accounting when it has standalone value to our clients. We routinely enter into arrangements that can include various combinations of multiple training offerings, consulting services, and intellectual property licenses. The timing of delivery and performance of the elements typically varies from contract to contract. Generally, these items qualify as separate units of accounting because they have value to the customer on a standalone basis. When the Company’s training and consulting arrangements contain multiple deliverables, consideration is allocated at the inception of the arrangement to all deliverables based on their relative selling prices at the beginning of the agreement, and revenue is recognized as each offering, consulting service, or intellectual property license is delivered. We use the following selling price hierarchy to determine the fair value to be used for allocating revenue to the elements: (i) vendor-specific objective evidence of fair value (VSOE), (ii) third-party evidence (TPE), and (iii) best estimate of selling price (BESP). Generally, VSOE is based on established pricing and discounting practices for the deliverables when sold separately. In determining VSOE, we require that a substantial majority of the selling prices fall within a narrow range. When VSOE cannot be established, judgment is applied with respect to whether a selling price can be established based on TPE, which is determined based on competitor prices for similar offerings when sold separately. Our products and services normally contain a significant level of differentiation such that the comparable pricing of services with similar functionality cannot be obtained. When we are unable to establish a selling price using VSOE or TPE, BESP is used in our allocation of arrangement consideration. BESPs are established as best estimates of what the selling price would be if the deliverables were sold regularly on a stand-alone basis. Our process for determining BESPs requires judgment and considers multiple factors, such as market conditions, type of customer, geographies, stage of product lifecycle, internal costs, and gross margin objectives. These factors may vary over time depending upon the unique facts and circumstances related to each deliverable. However, we do not expect the effect of changes in the selling price or method or assumptions used to determine selling price to have a significant effect on the allocation of arrangement consideration. Our multiple-element arrangements generally do not include performance, cancellation, termination, or refund-type provisions. Our international strategy includes the use of licensees in countries where we do not have a wholly-owned direct office. Licensee companies are unrelated entities that have been granted a license to translate our content and offerings, adapt the content to the local culture, and sell our content in a specific country or region. Licensees are required to pay us royalties based upon a percentage of their sales to clients. We recognize royalty income each period based upon the sales information reported to us from our licensees. Licensee royalty revenues are included as a component of training sales and totaled $10.7 million, $10.6 million, and $14.4 million for the fiscal years ended August 31, 2018, 2017, and 2016. The decrease in international licensee royalties in fiscal 2017 was primarily due to the conversion of our licensee operations in China into directly-owned offices. Revenue is recognized as the net amount to be received after deducting estimated amounts for discounts and product returns. Stock-Based Compensation We record the compensation expense for all stock-based payments, including grants of stock options and the compensatory elements of our employee stock purchase plan, in our consolidated statements of operations based upon their fair values over the requisite service period. For more information on our stock-based compensation plans, refer to Note 11.
Shipping and Handling Fees and Costs All shipping and handling fees billed to customers are recorded as a component of net sales. All costs incurred related to the shipping and handling of products are recorded in cost of sales. Advertising Costs Costs for advertising are expensed as incurred. Advertising costs included in selling, general, and administrative expenses totaled $6.9 million, $6.4 million, and $6.6 million for the fiscal years ended August 31, 2018, 2017, and 2016. Income Taxes Our income tax provision has been determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred income taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The income tax provision represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred income taxes result from differences between the financial and tax bases of our assets and liabilities and are adjusted for tax rates and tax laws when changes are enacted. A valuation allowance is provided against deferred income tax assets when it is more likely than not that all or some portion of the deferred income tax assets will not be realized. Interest and penalties related to uncertain tax positions are recognized as components of income tax benefit or expense in our consolidated statements of operations. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement. We provide for income taxes, net of applicable foreign tax credits, on temporary differences in our investment in foreign subsidiaries, which consist primarily of unrepatriated earnings. Comprehensive Income Comprehensive income includes changes to equity accounts that were not the result of transactions with shareholders. Comprehensive income is comprised of net income or loss and other comprehensive income and loss items. Our other comprehensive income and losses generally consist of changes in the cumulative foreign currency translation adjustment, net of tax. Accounting Pronouncements Issued and Adopted In March 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-09, Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting. The guidance in ASU 2016-09 simplifies several aspects of the accounting for stock-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification of items on the statement of cash flows. The guidance in ASU 2016-09 is effective for public companies’ annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. We adopted the provisions of ASU 2016-09 on September 1, 2017 on a prospective basis and prior periods have not been restated for these amendments. The primary impact of adopting this guidance on our financial statements has been the classification of excess income tax benefits or expense in income taxes rather than as a component of additional paid-in capital. The adoption of ASU 2016-09 did not have a material impact on our financial statements in fiscal 2018.
Accounting Pronouncements Issued Not Yet Adopted On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This new standard was issued in conjunction with the International Accounting Standards Board (IASB) and is designed to create a single, principles-based process by which all businesses calculate revenue. The core principle of this standard is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. The standard also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. The new standard replaces numerous individual, industry-specific revenue rules found in generally accepted accounting principles in the United States. We will adopt this standard on September 1, 2018 and apply the new guidance during interim periods within fiscal 2019. We plan to adopt ASU No. 2014-09 using the “modified retrospective” approach. Based upon our analysis of Topic 606, we expect that revenue recognition among our products and services will remain largely unchanged except for our initial license fee associated with licensing an international location. The Company currently records the non-refundable initial license fee from licensing an international location as revenue at the time the license period begins if all other revenue requirements have been met. However, under Topic 606, we have concluded that initial upfront fees should be recognized over the course of the initial contract. Under Topic 606, we will account for the All Access Pass (AAP) as a single performance obligation and recognize the associated transaction price on a straight-line basis over the term of the underlying contract. This determination was reached after considering that our web-based functionality and content, in combination with our intellectual property, each represent inputs that transform into a combined output that represents the intended outcome of the AAP, which is to provide a continuously accessible, customized, and dynamic learning and development solution only accessible through the AAP platform. We do not expect the accounting for fulfillment costs or costs incurred to obtain a contract to be affected materially in any period due to the adoption of Topic 606. Although the Company is still finalizing its analysis of the adoption of Topic 606, we estimate that the initial impact upon adoption will be a reduction to the opening balance of retained earnings with offsetting amounts recorded to deferred revenue and deferred tax asset in an amount between $2 million and $4 million. We do not expect the adoption of ASU 2014-09 to have any impact on our operating cash flows. On February 25, 2016, the FASB issued ASU No. 2016-02, Leases. The new lease accounting standard is the result of a collaborative effort with the IASB (similar to the new revenue standard described above), although some differences remain between the two standards. This new standard will affect all entities that lease assets and will require lessees to recognize a lease liability and a right-of-use asset for all leases (except for short-term leases that have a duration of less than one year) as of the date on which the lessor makes the underlying asset available to the lessee. For lessors, accounting for leases is substantially the same as in prior periods. For public companies, the new lease standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted for all entities. We expect to adopt the provisions of ASU 2016-02 on September 1, 2019, and we may elect to apply the new standard on a prospective basis. At August 31, 2018, our leases primarily consist of the lease on our corporate campus, which is accounted for as a financing obligation (Note 6) on our consolidated balance sheets and operating leases for office and warehousing space. We expect the adoption of this new standard will increase our reported assets and liabilities since we will record the lease obligation and a corresponding right of use asset on our balance sheet for leases that are currently accounted for as operating leases (Note 7). However, as of August 31, 2018, we have not yet elected the transition method or determined the full impact that the adoption of ASU 2016-02 will have on our consolidated financial statements.
|
Business Acquisitions |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisitions [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisitions | 2.BUSINESS ACQUISITIONS Robert Gregory Partners, LLC On May 15, 2017, we acquired the assets of Robert Gregory Partners, LLC (RGP), a Dublin, Ohio based corporate coaching firm, for $3.5 million in cash plus potential contingent consideration totaling $4.5 million. Robert Gregory Partners is a corporate coaching firm with expertise in executive coaching, transition acceleration coaching, leadership development coaching, implementation coaching, and consulting. We believe that the acquired RGP services and methodologies have become important offerings in our training and consulting business. The financial results of RGP have been included in our consolidated financial statements since the date of the acquisition. The total purchase price consisted of the following (in thousands):
The major classes of assets and liabilities to which we have allocated the purchase price were as follows (in thousands):
The goodwill generated from the RGP acquisition was allocated to each of our operating segments. The goodwill was primarily attributed to increased synergies that are expected to be achieved from the integration of RGP’s coaching methodologies into our services and offerings. All of the goodwill from the RGP acquisition is expected to be deductible for income tax purposes. The payment of contingent consideration is based on the achievement of specified financial results and the delivery of “add-on coaching services” content that is included in our All Access Pass offering. We paid the former owners of RGP $1.0 million during fiscal 2018 as contingent consideration for achieving specified financial results. During the fourth quarter of fiscal 2017, we paid the former owners of RGP $0.5 million of contingent consideration for delivery of the content that was integrated into our AAP offering. Due to the timing of the $0.5 million payment for add-on coaching services, this amount was included in the investing activities section of the accompanying consolidated statement of cash flows for fiscal 2017. Refer to Note 10 for further information regarding the fair value of the contingent consideration liability resulting from the RGP acquisition.
The details of the purchase price allocated to the intangible assets acquired were as follows (in thousands):
Our fiscal 2017 consolidated statement of operations include $1.2 million of revenue and $0.4 million of income from operations, excluding amortization of intangible assets, attributable to RGP since the date of the acquisition. For the twelve months ended December 31, 2016, RGP had revenues of $3.3 million (unaudited) and operating income of $1.1 million (unaudited). The costs to acquire RGP totaled approximately $0.1 million and were expensed as components of selling, general, and administrative expense in our consolidated financial statements. Jhana Education On July 11, 2017, we acquired all of the outstanding stock of Jhana Education (Jhana), a San Francisco based company that specializes in the creation and dissemination of relevant, bite-sized content and learning tools for leaders and managers. The acquired Jhana content and delivery methodologies have become key features of our current AAP offering. The purchase price was $3.5 million in cash plus up to $7.2 million of contingent consideration. The financial results of Jhana have been included in our consolidated financial statements since the date of the acquisition. The total purchase price consisted of the following (in thousands):
The major classes of assets and liabilities to which we have allocated the purchase price were as follows (in thousands):
The details of the purchase price allocated to the intangible assets acquired consisted of the following (in thousands):
The goodwill from the Jhana acquisition was assigned to the Direct Offices, Strategic Markets, and International Licensee segments (Note 4). The goodwill was primarily attributed to increased synergies that are expected to be achieved from the integration of Jhana’s content and delivery methodologies into our services and offerings, especially in the All Access Pass. None of the goodwill from the Jhana acquisition is expected to be deductible for income tax purposes. During fiscal 2018, we paid $2.4 million to the former owners of Jhana as contingent consideration based on the acquisition agreement. The first $1.1 million was paid within 90 days of the acquisition date and was classified as a component of cash flows from investing activities in our fiscal 2018 consolidated statement of cash flows. The payment of the remaining contingent consideration is based on certain revenue streams over the measurement period, which ends in July 2026. Refer to Note 10 for further information regarding the fair value of contingent consideration resulting from the Jhana acquisition. The acquisition of Jhana had an immaterial impact on our consolidated financial statements for the fiscal year ended August 31, 2017. For the year ending December 31, 2016, Jhana had revenues of $1.6 million (unaudited) and a loss before income taxes of $3.1 million (unaudited). The costs to acquire Jhana totaled approximately $0.1 million and were expensed as incurred. The acquisition costs were included in our selling, general, and administrative expenses. Unaudited Pro Forma Information The following are supplemental consolidated financial results of Franklin Covey Co. on an unaudited pro forma basis as if the acquisitions of RGP and Jhana had been completed on September 1, 2015 (in thousands, except per share amounts):
These pro forma results were based on estimates and assumptions, which we believe are reasonable. They are not the results that would have been realized had we been a combined company during the periods presented, and are not necessarily indicative of our consolidated results of operations in future periods. The pro forma results include adjustments related to purchase accounting, primarily the amortization of intangible assets, interest expense, and inclusion of acquisition costs.
|
Accounts Receivable |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable |
3.ACCOUNTS RECEIVABLE Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts represents our best estimate of the amount of probable credit losses in the existing accounts receivable balance, and we review the adequacy of the allowance for doubtful accounts on a regular basis. We determine the allowance for doubtful accounts using historical write-off experience based on the age of the receivable balances and current general economic conditions. Receivable balances past due over 90 days, which exceed a specified dollar amount, are reviewed individually for collectability. As we increase sales to governmental organizations, including school districts, and offer longer payment terms on certain contracts (which are still within our normal payment terms), our collection cycle may increase in future periods. If the risk of non-collection increases for such receivable balances, there may be additional charges to expense to increase the allowance for doubtful accounts. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We do not have any off-balance sheet credit exposure related to our customers nor do we generally require collateral or other security agreements from our customers. Activity in our allowance for doubtful accounts was comprised of the following for the periods indicated (in thousands):
Deductions on the foregoing table represent the write-off of amounts deemed uncollectible during the fiscal year presented. Recoveries of amounts previously written off were insignificant for the periods presented.
|
Intangible Assets And Goodwill |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets And Goodwill [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets And Goodwill |
4.INTANGIBLE ASSETS AND GOODWILL Intangible Assets Our intangible assets were comprised of the following (in thousands):
Our intangible assets are amortized over the estimated useful life of the asset. The range of remaining estimated useful lives and weighted-average amortization period over which we are amortizing the major categories of finite-lived intangible assets at August 31, 2018 were as follows:
Our aggregate amortization expense from finite-lived intangible assets totaled $5.4 million, $3.5 million, and $3.3 million for the fiscal years ended August 31, 2018, 2017, and 2016. Amortization expense from our intangible assets over the next five years is expected to be as follows (in thousands):
Goodwill Activity in our consolidated goodwill consisted of the following during fiscal 2018 and 2017 (in thousands):
We allocated the goodwill generated from our fiscal 2017 business acquisitions to our operating segments based on their relative fair values as shown below (in thousands):
During fiscal 2018, we dissolved the Strategic Markets segment and combined its operations with the Direct Office segment (Note 16). We reclassified the goodwill from the Strategic Market segment to the Direct Office segment as shown below (in thousands):
|
Term Loans Payable And Revolving Line Of Credit |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Term Loans Payable And Revolving Line Of Credit [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Term Loans Payable And Revolving Line Of Credit | 5.TERM LOANS PAYABLE AND REVOLVING LINE OF CREDIT We have entered into an amended and restated secured credit agreement (the Restated Credit Agreement) with our existing lender. The Restated Credit Agreement provides us with a revolving line of credit facility and the ability to borrow on other instruments, such as term loans. We generally renew the Restated Credit Agreement on a regular basis to maintain the long-term availability of this credit facility. During fiscal 2017, we entered into the Sixth, Seventh, and Eighth Modification Agreements to the Restated Credit Agreement. The Sixth Modification and Eighth Modification agreements adjusted the definition of EBITDAR in the funded debt to EBITDAR and fixed charge coverage ratios applicable to our debt covenants to include the change in deferred revenue from subscription sales. The Seventh Modification Agreement extended the maturity date of the Restated Credit Agreement. On August 17, 2018, we entered into the Ninth Modification Agreement, which extended the maturity date of the Restated Credit Agreement by one year to March 31, 2021. In connection with the modification agreements to the Restated Credit Agreement, we have entered into a security agreement, repayment guaranty agreements, and a pledge and security agreement. These agreements pledge substantially all of our assets located in the United States to the lender as collateral for borrowings under the Restated Credit Agreement and subsequent amendments. The effective interest rate on our term loans and revolving line of credit was 3.9 percent at August 31, 2018 and 3.1 percent at August 31, 2017. Term Loans Payable In connection with the terms of our modified Restated Credit Agreement, we obtained a $15.0 million term loan and have the ability to obtain additional term loans in increments of $5.0 million up to a maximum of $40.0 million. Each additional term loan reduces the amount available to borrow on the revolving line of credit facility on a dollar-for-dollar basis. We obtained additional $5.0 million term loans during each of September 2016 and August 2017. Interest on the term loans is payable monthly at LIBOR plus 1.85 percent per year and each term loan matures three years from the date of borrowing. Interest is payable monthly and principal payments are due and payable on the first day of each January, April, July, and October. Principal payments are equal to the original amount of each term loan divided by 16 and any remaining principal at the maturity date is immediately payable or may be rolled into a new term loan. The proceeds from each term loan may be used for general corporate purposes and each term loan may be repaid sooner than the maturity date at our discretion. The following information applies to our term loans payable at August 31, 2018 (in thousands):
Principal payments by fiscal year through the maturity dates of the term loans are as follows (in thousands):
Revolving Line of Credit The key terms and conditions of our revolving line of credit are as follows:
In the event of noncompliance with these financial covenants and other defined events of default, the lender is entitled to certain remedies, including acceleration of the repayment of any amounts outstanding on the Restated Credit Agreement. At August 31, 2018, we believe that we were in compliance with the terms and covenants applicable to our Restated Credit Agreement and its modifications. We had $11.3 million outstanding on our revolving line of credit at August 31, 2018, and $4.4 million outstanding on August 31, 2017.
|
Financing Obligation |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Obligation [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Obligation | 6.FINANCING OBLIGATION In connection with the sale and leaseback of our corporate headquarters facility located in Salt Lake City, Utah, we entered into a 20-year master lease agreement with the purchaser, an unrelated private investment group. The 20-year master lease agreement also contains six five-year renewal options that allow us to maintain our operations at the current location for up to 50 years. Although the corporate headquarters facility was sold and the Company has no legal ownership of the property, under applicable accounting guidance we were prohibited from recording the transaction as a sale since we have subleased a significant portion of the property that was sold. Accordingly, we account for the sale as a financing transaction, which requires us to continue reporting the corporate headquarters facility as an asset and to record a financing obligation for the sale price. The financing obligation on our corporate campus was comprised of the following (in thousands):
Future principal maturities of our financing obligation were as follows at August 31, 2018 (in thousands):
Our remaining future minimum payments under the financing obligation in the initial 20-year lease term are as follows (in thousands):
The $1.3 million difference between the carrying value of the financing obligation and the present value of the future minimum financing obligation payments represents the carrying value of the land sold in the financing transaction, which is not depreciated. At the conclusion of the master lease agreement, the remaining financing obligation and carrying value of the land will be offset and written off of our consolidated financial statements.
|
Operating Leases |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Leases | 7.OPERATING LEASES Lease Expense In the normal course of business, we lease office space and warehouse and distribution facilities under non-cancelable operating lease agreements. We rent office space, primarily for international and domestic regional sales administration offices, in commercial office complexes that are conducive to sales and administrative operations. We also rent warehousing and distribution facilities that are designed to provide secure storage and efficient distribution of our training products, books, and accessories. These operating lease agreements often contain renewal options that may be exercised at our discretion after the completion of the base rental term. In addition, many of the rental agreements provide for regular increases to the base rental rate at specified intervals, which usually occur on an annual basis. At August 31, 2018, we had operating leases with remaining terms ranging from less than one year to approximately seven years. The following table summarizes our future minimum lease payments under operating lease agreements at August 31, 2018 (in thousands):
We recognize lease expense on a straight-line basis over the life of the lease agreement. Contingent rent expense is recognized as it is incurred and was insignificant for the periods presented. Total rent expense recorded in selling, general, and administrative expense from operating lease agreements was $1.6 million, $1.8 million, and $2.2 million for the fiscal years ended August 31, 2018, 2017, and 2016.
Lease Income We have subleased the majority of our corporate headquarters campus located in Salt Lake City, Utah to multiple, unrelated tenants as well as to FC Organizational Products (Note 17). We recognize sublease income on a straight-line basis over the life of the sublease agreement. The cost basis of our corporate campus was $34.8 million, which had a carrying value of $7.6 million at August 31, 2018. The following future minimum lease payments due to us from our sublease agreements at August 31, 2018 include lease income of approximately $0.6 million per year from FCOP (in thousands):
Sublease revenue totaled $3.5 million, $3.6 million, and $4.4 million during the fiscal years ended August 31, 2018, 2017, and 2016.
|
Commitments And Contingencies |
12 Months Ended |
---|---|
Aug. 31, 2018 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | 8.COMMITMENTS AND CONTINGENCIES Warehouse Outsourcing Contract Effective July 1, 2016, we entered into a warehousing services agreement with an independent warehouse and distribution company to provide product kitting, warehousing, and order fulfillment services at a facility in Des Moines, Iowa. Under the terms of this contract, we pay a fixed charge of approximately $19,000 per month for account management services and variable charges for other warehousing services based on specified activities, including shipping charges. The warehouse charges may be increased each year of the contract based upon changes in the Employment Cost Index. The warehousing and distribution contract expires on June 30, 2019. During fiscal years 2018, 2017, and 2016, we expensed $2.9 million, $2.6 million, and $3.8 million for services provided under the terms of our warehouse and distribution outsourcing contract. The total amount expensed each year under these contracts include freight charges, which are billed to the Company based upon activity. Freight charges included in the warehouse and distribution outsourcing costs totaled $1.9 million, $1.5 million, and $1.8 million during the fiscal years ended August 31, 2018, 2017, and 2016. Because of the variable component of the agreement, our payments for warehouse and distribution services may fluctuate in future periods based upon sales and levels of specified activities. Purchase Commitments During the normal course of business, we issue purchase orders to various vendors for products and services. At August 31, 2018, we had open purchase commitments totaling $4.3 million for products and services to be delivered primarily in fiscal 2019. Letters of Credit At August 31, 2018 and 2017, we had standby letters of credit totaling $0.1 million. These letters of credit were primarily required to secure commitments for certain insurance policies and expire in January 2019. No amounts were drawn on the letters of credit at either August 31, 2018 or August 31, 2017. Legal Matters and Loss Contingencies We are the subject of certain legal actions, which we consider routine to our business activities. At August 31, 2018, we believe that, after consultation with legal counsel, any potential liability to us under these other actions will not materially affect our financial position, liquidity, or results of operations.
|
Shareholders' Equity |
12 Months Ended |
---|---|
Aug. 31, 2018 | |
Shareholders' Equity [Abstract] | |
Shareholders' Equity | 9.SHAREHOLDERS’ EQUITY Preferred Stock We have 14.0 million shares of preferred stock authorized for issuance. At August 31, 2018 and 2017, no shares of preferred stock were issued or outstanding. Treasury Stock Open Market Purchases On January 23, 2015, our Board of Directors approved a new plan to repurchase up to $10.0 million of the Company’s outstanding common stock. All previously existing common stock repurchase plans were canceled and the new common share repurchase plan does not have an expiration date. On March 27, 2015, our Board of Directors increased the aggregate value of shares of Company common stock that may be purchased under the January 2015 plan to $40.0 million so long as we have either $10.0 million in cash and cash equivalents or have access to debt financing of at least $10.0 million. Through August 31, 2018, we have purchased 1,539,828 shares of our common stock for $26.8 million under the terms of this expanded common stock repurchase plan. The actual timing, number, and value of common shares repurchased under this plan will be determined at our discretion and will depend on a number of factors, including, among others, general market and business conditions, the trading price of our common shares, and applicable legal requirements. The Company has no obligation to repurchase any common shares under the authorization, and the repurchase plan may be suspended, discontinued, or modified at any time for any reason. The cost of common stock purchased for treasury as shown on our consolidated statement of cash flows for the year ending August 31, 2018 is comprised of the cost of 104,699 shares that were withheld for statutory income taxes on stock-based compensation awards issued to participants during the fiscal 2018. The withheld shares were valued at the market price on the date the shares were distributed to participants, which totaled $2.0 million. For the fiscal years ended August 31, 2017 and 2016, we withheld 51,156 shares and 2,260 shares for minimum statutory taxes on stock-based compensation awards, which had a total value of $0.9 million and $38,000, respectively. Fiscal 2016 Tender Offer On December 8, 2015, we announced that our Board of Directors approved a modified Dutch auction tender offer for up to $35.0 million in value of shares of our common stock at a price within (and including) the range of $15.50 to $17.75 per share. The tender offer commenced on December 14, 2015, and expired at 11:59 p.m. Eastern time, on January 12, 2016. The tender offer was fully subscribed and we acquired 1,971,832 shares of our common stock at $17.75 per share. Including fees to complete the tender offer, the total cost of the tendered shares was $35.3 million, which was financed by existing cash and proceeds from our revolving line of credit facility. For further information regarding the terms and conditions of this completed tender offer, refer to information in the Tender Offer Statement on Schedule TO filed with Securities and Exchange Commission on December 14, 2015 and subsequent amendments thereto.
|
Fair Value Of Financial Instruments |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Of Financial Instruments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Of Financial Instruments | 10.FAIR VALUE OF FINANCIAL INSTRUMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the measurement date. The accounting standards related to fair value measurements include a hierarchy for information and valuations used in measuring fair value that is broken down into the following three levels based on reliability:
The book values of our financial instruments at August 31, 2018 and 2017 approximated their fair values. The assessment of the fair values of our financial instruments is based on a variety of factors and assumptions. Accordingly, the fair values may not represent the actual values of the financial instruments that could have been realized at August 31, 2018 or 2017, or that will be realized in the future, and do not include expenses that could be incurred in an actual sale or settlement. The following methods and assumptions were used to determine the fair values of our financial instruments, none of which were held for trading or speculative purposes: Cash, Cash Equivalents, and Accounts Receivable – The carrying amounts of cash, cash equivalents, and accounts receivable approximate their fair values due to the liquidity and short-term maturity of these instruments. Other Assets – Our other assets, including notes receivable, were recorded at the net realizable value of estimated future cash flows from these instruments. Debt Obligations – At August 31, 2018, our debt obligations consisted of variable-rate term notes payable and borrowings on our variable-rate revolving line of credit. The term notes payable and revolving line of credit (Note 5) are negotiated components of our Restated Credit Agreement, which is renewed on a regular basis to maintain the long-term borrowing capability of the agreement. Accordingly, the applicable interest rates on the term loans and revolving line of credit are reflective of current market conditions, and the carrying value of term loan and revolving line of credit obligations therefore approximate their fair value. Contingent Consideration Liabilities from Business Acquisitions We have contingent consideration liabilities resulting from our fiscal 2017 business acquisitions (Note 2). We measure the fair values of our contingent consideration liabilities at each reporting date based on various valuation models as described below. Changes to the fair value of the contingent consideration liabilities are recorded as components of our selling, general, and administrative expenses in the accompanying consolidated statements of operations in the period of adjustment. The fair value of the contingent consideration liabilities from the acquisition of RGP and Jhana changed as follows during fiscal 2018 (in thousands):
The fair values of contingent consideration liabilities are recorded as components of accrued liabilities and other long-term liabilities based on expected payment dates. Robert Gregory Partners – On May 15, 2017, we acquired the assets of RGP. The purchase price included contingent consideration payments to the former owners of RGP of up to $4.5 million, based on the achievement of specified levels of earnings before interest, income taxes, depreciation, and amortization expense (EBITDA) and the delivery of “add-on coaching services content” for our AAP as set forth in the purchase agreement. The specified levels of EBITDA include measures for RGP coaching services plus earnings from add-on coaching services sold through the AAP. The fair value of the RGP contingent liability is estimated using a Monte Carlo simulation method, which considers numerous potential financial outcomes using estimated variables such as expected revenues, growth rates, and a discount rate. This fair value measurement is considered a Level 3 measurement because we estimate revenues and corresponding expected growth rates each period. The following range of growth rates were used to calculate the initial fair value of the contingent consideration:
Jhana Education – On July 11, 2017, we acquired the stock of Jhana Education. The purchase price included potential contingent consideration of $7.2 million through the measurement period, which ends in July 2026. The fair value of the contingent consideration was calculated using a probability weighted expected return methodology, which is a Level 3 measurement because we estimate projected consolidated Company and AAP sales over the measurement period. Probabilities were applied to each potential sales outcome and the resulting values were discounted using a rate that considered Jhana’s weighted average cost of capital and specific risk premiums associated with the potential contingent consideration.
|
Stock-Based Compensation Plans |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation Plans [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation Plans | 11.STOCK-BASED COMPENSATION PLANS Overview We utilize various stock-based compensation plans as integral components of our overall compensation and associate retention strategy. Our shareholders have approved various stock incentive plans that permit us to grant performance awards, unvested share awards, stock options, and employee stock purchase plan (ESPP) shares. In addition, our Board of Directors and shareholders may, from time to time, approve fully vested stock awards. The Organization and Compensation Committee of the Board of Directors (the Compensation Committee) has responsibility for the approval and oversight of our stock-based compensation plans. On January 23, 2015, our shareholders approved the 2015 Omnibus Incentive Plan (the 2015 Plan), which authorized 1.0 million shares of common stock for issuance to employees and members of the Board of Directors as stock-based payments. A more detailed description of the 2015 Plan is set forth in our Definitive Proxy Statement filed with the SEC on December 22, 2014. At August 31, 2018, the 2015 Plan had approximately 254,000 shares available for future grants. At the annual meeting of shareholders held on January 26, 2018, our shareholders approved the Franklin Covey Co. 2017 Employee Stock Purchase Plan (the 2017 ESPP). The 2017 ESPP replaced the Franklin Covey Co. 2004 Employee Stock Purchase Plan, which previously expired. The 2017 ESPP authorized an additional 1.0 million shares, subject to certain adjustments, of our common stock for issuance to ESPP participants. For further information regarding the 2017 ESPP, including the full text of the 2017 ESPP, please refer to our definitive Proxy Statement as filed with the SEC on December 22, 2017. At August 31, 2018, the 2017 ESPP had approximately 946,000 shares remaining for purchase by plan participants. The total compensation expense of our stock-based compensation plans was as follows (in thousands):
The compensation expense of our stock-based compensation plans was included in selling, general, and administrative expenses in the accompanying consolidated statements of operations, and no stock-based compensation was capitalized during fiscal years 2018, 2017, or 2016. We recognize forfeitures of stock-based compensation instruments as they occur. During fiscal 2018, we issued 311,898 shares of our common stock from shares held in treasury for various stock-based compensation plans. Our stock-based compensation plans allow shares to be withheld from the award to pay statutory income tax liabilities. We withheld 104,699 shares of our common stock (Note 9) for statutory income taxes during fiscal 2018. The following is a description of our stock-based compensation plans. Performance Awards The Compensation Committee has awarded various performance-based stock compensation awards to members of our senior management as long-term incentive plan (LTIP) compensation. These awards vest to the participants based upon the achievement of specified performance criteria. Compensation expense is recognized as we determine it is probable that the shares will vest. Adjustments to compensation expense to reflect the timing of and the number of shares expected to be awarded are made on a cumulative basis at the date of the adjustment. We reevaluate the likelihood of shares vesting under performance awards at each reporting date. Due to the significant change in our business resulting from sales of the All Access Pass, on October 18, 2016, the Compensation Committee approved a modification to the fiscal 2012 through fiscal 2016 performance awards to include the change in deferred revenue, less certain costs, in adjusted earnings before interest, taxes, depreciation, and amortization (Adjusted EBITDA) in the vesting calculations. Our share price on October 18, 2016 was less than the share prices used to recognize stock-based compensation expense on the fiscal 2012 through fiscal 2015 performance awards and no incremental stock-based compensation expense was recognized from this modification for those awards. The incremental compensation expense recorded in fiscal 2017 as a result of this modification for the fiscal 2016 LTIP award was approximately $0.6 million. The following is a description of our performance-based LTIP awards as of August 31, 2018. Fiscal 2018 LTIP Award – On November 14, 2017, the Compensation Committee granted a new performance-based LTIP award to our executive officers and members of senior management. The fiscal 2018 LTIP award has three tranches, which consist of the following: 1) shares that vest after three years of service; 2) the achievement of certain levels of fiscal 2020 qualified Adjusted EBITDA; and 3) fiscal 2020 subscription service sales. Twenty-five percent of a participant’s award vests after three years of service, and the number of shares awarded in this tranche will not fluctuate based on the described financial measures. The number of shares granted in this tranche totals 42,883 shares. The remaining two tranches of the award are divided between the achievement of certain levels of Adjusted EBITDA and subscription sales recognized in fiscal 2020. The number of shares that will vest to participants for these two tranches is variable and may be 50 percent of the award (minimum award threshold) up to 200 percent of the participant’s award (maximum threshold). The maximum number of shares that may be awarded in connection with these tranches totals 257,300 shares. The fiscal 2018 LTIP has a three-year life and expires on August 31, 2020. Fiscal 2017 LTIP Award – On October 18, 2016, the Compensation Committee granted performance-based awards for our executive officers and members of senior management. A total of 183,381 shares may be earned by the participants based on six individual vesting conditions that are divided into two performance measures, trailing four-quarter Adjusted EBITDA and trailing four-quarter gross All Access Pass sales. As of August 31, 2018, four tranches of this award have vested, totaling 97,803 shares. The 2017 LTIP has a six-year life and expires on August 31, 2022. Fiscal 2016 LTIP Award – The fiscal 2016 LTIP was granted on November 12, 2015, to our executive officers and members of senior management. A total of 231,276 shares may be awarded to the participants based on six individual vesting conditions that are divided into two performance measures, trailing four-quarter Adjusted EBITDA and increased sales of Organizational Development Suite (OD Suite) offerings. The OD Suite is defined as Leadership, Productivity, and Trust practice sales. As of August 31, 2018, four tranches of the fiscal 2016 LTIP have vested to participants, totaling 123,348 shares. The 2016 LTIP has a six-year life and expires on August 31, 2021. Fiscal 2015 LTIP Award – During fiscal 2015, the Compensation Committee granted a performance-based award for our executive officers and certain members of senior management. A total of 112,464 shares may be awarded to the participants based on six individual vesting conditions that are divided into two performance measures, trailing four-quarter Adjusted EBITDA and increased sales of OD Suite sales as described above. As of August 31, 2018, a total of 59,980 shares, or four tranches, of the fiscal 2015 LTIP have vested to participants. The 2015 LTIP has a six-year life and expires on August 31, 2020. Fiscal 2014 LTIP Award – During the first quarter of fiscal 2014, the Compensation Committee granted performance-based equity awards to our executive officers. A total of 89,418 shares may be awarded to the participants based on six individual vesting conditions that are divided into two performance measures, trailing four-quarter Adjusted EBITDA and trailing four-quarter increased sales of courses related to The 7 Habits of Highly Effective People. As of August 31, 2018, four tranches of the fiscal 2014 LTIP, totaling 47,690 shares, have vested to participants. The fiscal 2014 LTIP has a six-year life and expires on August 31, 2019. Fiscal 2013 LTIP Award – During fiscal 2013, the Compensation Committee granted a performance-based equity award for the Chief Executive Officer (CEO), Chief Financial Officer, and the Chief People Officer. A total of 68,085 shares may be issued to the participants based on six individual vesting conditions that are divided into two performance measures, trailing four-quarter Adjusted EBITDA and Productivity Practice sales. As of August 31, 2018, three tranches of the fiscal 2013 LTIP award, or 38,582 shares, have vested to participants. The fiscal 2013 LTIP award had a six-year life that ended on August 31, 2018, and the remaining award tranches totaling 29,503 shares expired unvested to the participants.
Unvested Stock Awards The annual Board of Director unvested stock award, which is administered under the terms of the Franklin Covey Co. 2015 Omnibus Incentive Plan, is designed to provide our non-employee directors, who are not eligible to participate in our employee stock purchase plan, an opportunity to obtain an interest in the Company through the acquisition of shares of our common stock. Each eligible director is entitled to receive a whole-share grant equal to $100,000 with a one-year vesting period, which is generally granted in January (following the Annual Shareholders’ Meeting) of each year. Shares granted under the terms of this annual award may not be voted or participate in any common stock dividends until they are vested. Under the terms of this program, we issued 23,338 shares, 29,834 shares, and 25,032 shares of our common stock to eligible members of the Board of Directors during the fiscal years ended August 31, 2018, 2017, and 2016. The fair value of shares awarded to the directors was $0.7 million in fiscal 2018 and $0.5 million in each of fiscal 2017 and fiscal 2016 as calculated on the grant date of the awards. The corresponding compensation cost is recognized over the vesting period of the awards, which is one year. The cost of the common stock issued from treasury for these awards was $0.3 million in fiscal 2018, $0.4 million in fiscal 2017, and $0.3 million in fiscal 2016. The following information applies to our unvested stock awards for the fiscal year ended August 31, 2018:
At August 31, 2018, there was $0.2 million of unrecognized compensation cost related to unvested stock awards, which is expected to be recognized over the remaining weighted-average vesting period of four months. The total recognized income tax benefit from unvested stock awards totaled $0.2 million in fiscal 2018, $0.2 million for fiscal 2017, and $0.1 million in fiscal 2016. The intrinsic value of our unvested stock awards at August 31, 2018 was $0.6 million. Stock Options We have an incentive stock option plan whereby options to purchase shares of our common stock may be issued to key employees at an exercise price not less than the fair market value of the Company’s common stock on the date of grant. Information related to our stock option activity during the fiscal year ended August 31, 2018 is presented below:
During fiscal 2017, we had 62,500 stock options exercised on a net share basis, which had an intrinsic value of $0.5 million. At August 31, 2018, there was no remaining unrecognized compensation expense related to our stock options and no options were exercised during either fiscal 2018 or 2016. The following additional information applies to our stock options outstanding at August 31, 2018:
Fully Vested Stock Awards We have a stock-based incentive program that is designed to reward our client partners and training consultants for exceptional long-term performance. The program grants shares of our common stock with a total value of $15,000 to each client partner who has sold over $20.0 million in cumulative sales and to each training consultant who has delivered over 1,500 days of training during their career. During fiscal 2018, one individual qualified for this award; nine individuals qualified for this award in fiscal 2017; and four individuals qualified for this award in fiscal 2016. Employee Stock Purchase Plan We have an employee stock purchase plan that offers qualified employees the opportunity to purchase shares of our common stock at a price equal to 85 percent of the average fair market value of our common stock on the last trading day of each quarter. We issued a total of 40,941 shares, 43,199 shares, and 49,375 shares to ESPP participants during the fiscal years ended August 31, 2018, 2017, and 2016, which had a corresponding cost basis of $0.6 million, $0.6 million, and $0.7 million, respectively. We received cash proceeds for these shares from ESPP participants totaling $0.8 million in fiscal 2018 and $0.7 million in each of the fiscal years ended August 31, 2017 and 2016.
|
Contract Termination And Restructuring Costs |
12 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||
Contract Termination And Restructuring Costs [Abstract] | |||||||||||||||||||||||||
Contract Termination And Restructuring Costs |
12.CONTRACT TERMINATION AND RESTRUCTURING COSTS Contract Termination Costs During fiscal 2017, we entered into a new 10-year license agreement for Education practice content in a foreign country, with minimum required royalties payable to us totaling approximately $13 million (at current exchange rates) over the life of the arrangement. Under a previously existing profit-sharing agreement, we would have been obligated to pay one-third of the new minimum royalty stream plus one-third of any royalties in excess of the contractual minimums to the licensee that owns the rights for that country. In exchange for a $1.5 million cash payment, we terminated the previously existing profit-sharing agreement and we will not owe any further profit sharing-payments to the international licensee. Based on the guidance for contract termination costs, we expensed the $1.5 million payment during fiscal 2017. Restructuring Costs Fiscal 2017 Restructuring Costs During the third quarter of fiscal 2017, we determined to exit the publishing business in Japan and restructured our U.S./Canada direct office operations in order to support new sales and renewals of the All Access Pass. We expensed $3.6 million related to these changes during fiscal 2017 as described below. The majority of these costs were attributable to our Direct Offices segment. Exit Japan Publishing Business Due to a change in strategy designed to focus resources and efforts on sales of the All Access Pass in Japan, and declining sales and profitability of the publishing business, we decided to exit the publishing business in Japan. As a result of this determination, we wrote off the majority of our book inventory located in Japan for $2.1 million, which was recorded as a component of product cost of sales in the accompanying consolidated statements of operations for fiscal 2017. U.S./Canada Direct Office Restructuring We restructured the operations of our U.S/Canada direct offices to create new smaller regional teams which are focused on selling the All Access Pass, helping clients strategically implement the AAP, and providing services to further develop long-term client relationships. Accordingly, we determined that our three remaining sales offices located in Atlanta, Georgia; Irvine, California; and Chicago, Illinois were unnecessary since most client partners work from home-based offices; restructured the operations of the Sales Performance and Winning Customer Loyalty Practices; and eliminated certain functions to reduce costs in future periods. The $1.5 million restructuring charge associated with these operational changes was comprised of the following (in thousands):
As of August 31, 2018 and August 31, 2017, we had accrued office closure costs totaling $0.1 million and $0.5 million, which are included as components of accrued liabilities on the accompanying consolidated balance sheets. All of the severance costs associated with this restructuring plan were paid as of August 31, 2017.
Fiscal 2016 Restructuring Costs In the fourth quarter of fiscal 2016, we restructured the operations of certain of our domestic sales offices. The cost of this restructuring was $0.4 million and was primarily comprised of employee severance costs, which were paid in August and September 2016. We also restructured the operations of our Australian direct office. The restructuring was designed to reduce ongoing operating costs by closing the sales offices in Brisbane, Sydney, and Melbourne, and by reducing headcount for administrative and certain sales support functions. Our remaining sales and support personnel in Australia now work from home offices, similar to many of our sales personnel located in the U.S. and Canada. The Australia office restructure cost $0.4 million and was primarily comprised of office closure costs, including remaining lease expense on the offices that were closed, and for employee severance costs. The severance costs included in the restructuring charge totaled less than $40,000. As of August 31, 2017 substantially all of the remaining accrued restructuring costs were paid.
|
Employee Benefit Plans |
12 Months Ended |
---|---|
Aug. 31, 2018 | |
Employee Benefit Plans [Abstract] | |
Employee Benefit Plans | 13.EMPLOYEE BENEFIT PLANS Profit Sharing Plans We have defined contribution profit sharing plans for our employees that qualify under Section 401(k) of the Internal Revenue Code. These plans provide retirement benefits for employees meeting minimum age and service requirements. Qualified participants may contribute up to 75 percent of their gross wages, subject to certain limitations. These plans also provide for matching contributions to the participants that are paid by the Company. The matching contributions, which were expensed as incurred, totaled $2.1 million, $1.9 million, and $1.9 million during the fiscal years ended August 31, 2018, 2017, and 2016. We do not sponsor or participate in any defined-benefit pension plans. Non-Qualified Deferred Compensation Plan We had a non-qualified deferred compensation (NQDC) plan that provided certain key officers and employees the ability to defer a portion of their compensation until a later date. Deferred compensation amounts used to pay benefits were held in a “rabbi trust,” which invested in insurance contracts, various mutual funds, and shares of our common stock as directed by the plan participants. However, due to legal changes resulting from the American Jobs Creation Act of 2004, we determined to cease compensation deferrals to the NQDC plan after December 31, 2004. Following the cessation of deferrals to the NQDC plan, the number of participants remaining in the plan declined steadily, and our Board of Directors decided to partially terminate the NQDC plan. Following this decision, all of the plan’s assets were liquidated, the plan’s liabilities were paid, and the only remaining items in the NQDC plan are shares of our common stock owned by the remaining plan participants. At August 31, 2018 and 2017, the cost basis of the shares of our common stock held by the rabbi trust was $0.2 million and $0.4 million. Shares of our common stock held in the rabbi trust are included as components of treasury stock on the accompanying consolidated balance sheets.
|
Income Taxes |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes |
14.INCOME TAXES Our benefit (provision) for income taxes consisted of the following (in thousands):
The allocation of our total income tax benefit (provision) is as follows (in thousands):
Income (loss) before income taxes consisted of the following (in thousands):
The differences between income taxes at the statutory federal income tax rate and the consolidated income tax rate reported in our consolidated statements of operations were as follows:
The Tax Cut and Jobs Act (the 2017 Tax Act) was signed into law on December 22, 2017. The 2017 Tax Act significantly revises the U.S. corporate income tax code by, among other things, lowering the statutory corporate tax rate from 35 percent to 21 percent; eliminating certain deductions; imposing a mandatory one-time transition tax, or deemed repatriation tax, on accumulated earnings of foreign subsidiaries as of 2017 that were previously tax deferred; introducing new tax regimes; and changing how foreign earnings are subject to U.S. tax. Since we have an August 31 fiscal year end, the lower corporate income tax rate is phased in, resulting in a U.S. statutory federal rate of 25.7 percent for fiscal 2018 and 21 percent rate for subsequent fiscal years. Other provisions of the 2017 Tax Act will not be effective for us until fiscal 2019, including limitations on the deductibility of interest and executive compensation as well as anti-deferral provisions on Global Intangible Low-Taxed Income. We have completed our accounting for the effects of the 2017 Tax Act and recorded income tax benefits totaling $1.7 million during fiscal 2018, including a one-time income tax benefit of $0.9 million as of the date of enactment. We recognized $0.8 million of the one-time benefit from re-measuring our net deferred tax liabilities at the reduced U.S. federal tax rate and $0.2 million of the benefit from other changes enacted by the 2017 Tax Act. These benefits were partially offset by $0.1 million of expense from the deemed repatriation of accumulated earnings from our foreign subsidiaries. On September 1, 2017, we adopted the provisions of ASU 2016-09, which requires that the benefits of deductions resulting from stock-based compensation in excess of the corresponding book expense be recorded as a component of our income tax provision or benefit for the period, instead of being recorded to additional paid-in capital. We recorded an immaterial amount of income tax expense in fiscal 2018 for stock-based compensation deductions that were less than the corresponding book expense. We recorded $0.2 million to paid-in capital in fiscal 2017 for excess tax deductions and an insignificant deduction against paid-in capital during fiscal 2016 for the shortfall in tax deductions related to stock-based compensation.
The significant components of our deferred tax assets and liabilities were comprised of the following (in thousands):
Deferred income tax amounts are recorded as follows in our consolidated balance sheets (in thousands):
As of August 31, 2016, we had utilized all of our U.S. federal net operating loss carryforwards. However, we incurred a federal net operating loss of $16.4 million in fiscal 2017 and acquired a federal net operating loss carryforward of $7.7 million in connection with the purchase of the stock of Jhana Education (Note 2) in fiscal 2017. During fiscal 2018, we incurred a federal net operating loss of $9.7 million. Our U.S. federal net operating loss carryforwards were comprised of the following at August 31, 2018 (in thousands):
We have U.S. state net operating loss carryforwards generated in fiscal 2009 and before in various jurisdictions that expire primarily between September 1, 2018 and August 31, 2029. The U.S. state net operating loss carryforwards generated in fiscal 2017 and fiscal 2018 primarily expire on August 31, 2037 and 2038, respectively. The state net operating loss carryforwards acquired through the purchase of Jhana Education stock expire between August 31, 2031 and August 31, 2036. Our U.S. foreign income tax credit carryforwards were comprised of the following at August 31, 2018 (in thousands):
In fiscal 2018, we established a valuation allowance of $3.0 million against our foreign tax credit carryforward from fiscal 2011, after concluding it is more likely than not that the carryforward will expire unused at the end of fiscal 2021. Our emphasis of the All Access Pass has generated, and will likely continue to generate, substantial amounts of deferred revenue for both book and tax purposes. This situation has produced taxable losses for the past two fiscal years and a more-likely-than-not presumption that insufficient taxable income will be available to realize the fiscal 2011 foreign tax carryforward, which expires at the end of fiscal 2021. During the year ended August 31, 2016, we determined it was more likely than not that deferred tax assets of a foreign subsidiary would not be realized. Accordingly, we recorded a $0.3 million valuation allowance against these deferred tax assets in fiscal 2016. During fiscal 2017, we increased this valuation allowance by $0.1 million to $0.4 million, which reduced our income tax benefit for the year by $0.1 million. During fiscal 2018, we reduced this valuation allowance by $0.2 million, which increased our income tax benefit for the year by $0.2 million. We acquired federal and state net operating loss carryforwards in connection with the purchase of Jhana Education stock during fiscal 2017. Section 382 of the Internal Revenue Code limits our ability to use these acquired losses. Accordingly, we recorded valuation allowances in the amount of $0.2 million against the related deferred tax assets. Our income tax benefit for fiscal 2017 was unaffected by this valuation allowance. The reduction of the federal income tax rate under the 2017 Tax Act reduced this valuation allowance by $0.1 million and resulted in a corresponding increase to our income tax benefit during fiscal 2018. We have determined that projected future taxable income is adequate to allow for realization of all deferred tax assets, except for the assets subject to valuation allowances. We considered sources of taxable income, including reversals of taxable temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards, and reasonable, practical tax-planning strategies to generate additional taxable income. Based on the factors described above, we concluded that realization of our deferred tax assets, except those subject to the valuation allowances described above, is more likely than not at August 31, 2018. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in thousands):
The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate is $1.8 million at August 31, 2018, and $1.6 million at August 31, 2017. Included in the ending balance of gross unrecognized tax benefits at August 31, 2018 is $1.8 million related to individual states’ net operating loss carryforwards. Interest and penalties related to uncertain tax positions are recognized as components of income tax expense. The net accruals and reversals of interest and penalties increased or decreased our income tax expense by an insignificant amount in each of fiscal 2018, fiscal 2017 and fiscal 2016. The balance of interest and penalties included in other long-term liabilities on our consolidated balance sheets at August 31, 2018 and 2017 was $0.2 million and $0.3 million, respectively. During the next 12 months, we expect a decrease in unrecognized tax benefits totaling $0.2 million relating to non-deductible expenses and state net operating loss deductions upon the lapse of the applicable statute of limitations. We file United States federal income tax returns as well as income tax returns in various states and foreign jurisdictions. The tax years that remain subject to examinations for our major tax jurisdictions are shown below.
|
Earnings (Loss) Per Share |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (Loss) Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (Loss) Per Share | 15.EARNINGS (LOSS) PER SHARE The following is a reconciliation from basic earnings (loss) per share (EPS) to diluted EPS (in thousands, except per-share amounts).
Since we incurred a net loss for the fiscal year ended August 31, 2018, no potentially dilutive securities were included in the calculation of our loss per share because the inclusion of these securities would be antidilutive. The number of dilutive securities that would have been included at August 31, 2018 was approximately 0.2 million shares. Other securities, including performance stock-based compensation instruments, may have a dilutive effect on our EPS calculation in future periods if our financial results reach specified targets (Note 11).
|
Segment Information |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | 16.SEGMENT INFORMATION Reportable Segments Our sales are primarily comprised of training and consulting services. Consistent with changes during the first quarter of fiscal 2018 in our organization designed to promote the sale of subscription-based offerings, our internal reporting structure was revised and is now comprised of three operating segments and a corporate services group. The former Strategic Markets operating segment was absorbed by the Direct Office operating segment since its target customers and sales methodologies were essentially identical. The remaining operating segments were determined to be reportable segments under the applicable accounting guidance. The following is a brief description of our reportable segments:
We have determined that the Company’s chief operating decision maker continues to be the CEO, and the primary measurement tool used in business unit performance analysis is Adjusted EBITDA, which may not be calculated as similarly titled amounts calculated by other companies. For reporting purposes, our consolidated Adjusted EBITDA can be calculated as our income or loss from operations excluding stock-based compensation, contract termination costs, restructuring charges, depreciation expense, amortization expense, and certain other items such as adjustments for changes in the fair value of contingent consideration liabilities from business acquisitions. Our operations are not capital intensive and we do not own any manufacturing facilities or equipment. Accordingly, we do not allocate assets to the divisions for analysis purposes. Interest expense and interest income are primarily generated at the corporate level and are not allocated. Income taxes are likewise calculated and paid on a corporate level (except for entities that operate in foreign jurisdictions) and are not allocated for analysis purposes. All prior period segment information has been revised to conform to our current organizational structure, assigned responsibilities, and primary internal reports. We account for our segment information on the same basis as the accompanying consolidated financial statements.
A reconciliation of Adjusted EBITDA to consolidated net income (loss) is provided below (in thousands):
Geographic Information Our revenues are derived primarily from the United States. However, we also operate wholly owned offices or contract with licensees to provide our services in various countries throughout the world. Our consolidated revenues were derived from the following countries/regions (in thousands):
At August 31, 2018, we had wholly owned direct offices in Australia, China, Japan, and the United Kingdom. Our long-lived assets, excluding intangible assets, goodwill, and the long-term portion of the related party receivable were held in the following locations for the periods indicated (in thousands):
Inter-segment sales were immaterial and were eliminated in consolidation.
|
Related Party Transactions |
12 Months Ended | ||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||
Related Party Transactions | 17.RELATED PARTY TRANSACTIONS Knowledge Capital Investment Group Knowledge Capital Investment Group (Knowledge Capital) held a warrant to purchase 5.9 million shares of our common stock, exercised its warrant at various dates according to the terms of a fiscal 2011 exercise agreement, and received a total of 2.2 million shares of our common stock from shares held in treasury. Two members of our Board of Directors, including our CEO, have an equity interest in Knowledge Capital. Pursuant to the warrant exercise agreement with Knowledge Capital, we filed a registration statement with the SEC on Form S-3 to register shares held by Knowledge Capital. This registration statement was declared effective on January 26, 2015. At each of August 31, 2018 and 2017, Knowledge Capital held 2.8 million shares of our common stock. FC Organizational Products During fiscal 2008, we joined with Peterson Partners to create a new company, FC Organizational Products, LLC (FCOP). This new company purchased substantially all of the assets of our consumer solutions business unit with the objective of expanding the worldwide sales of FCOP as governed by a comprehensive license agreement between us and FCOP. On the date of the sale closing, we invested approximately $1.8 million to purchase a 19.5 percent voting interest in FCOP, and made a $1.0 million priority capital contribution with a 10 percent return. At the time of the transaction, we determined that FCOP was not a variable interest entity. As a result of FCOP’s structure as a limited liability company with separate owner capital accounts, we determined that our investment in FCOP is more than minor and we are required to account for our investment in FCOP using the equity method of accounting. We have not recorded our share of FCOP’s losses in the accompanying consolidated statements of operations because we have impaired and written off investment balances, as defined within the applicable accounting guidance, in previous periods in excess of our share of FCOP’s losses through August 31, 2018. Based on changes to FCOP’s debt agreements and certain other factors in fiscal 2012, we reconsidered whether FCOP was a variable interest entity as defined under FASC 810, and determined that FCOP was a variable interest entity. Although the changes to the debt agreements did not modify the governing documents of FCOP, the changes were substantial enough to raise doubts regarding the sufficiency of FCOP’s equity investment at risk. We further determined that we are not the primary beneficiary of FCOP because we do not have the ability to direct the activities that most significantly impact FCOP’s economic performance, which primarily consist of the day-to-day sale of planning products and related accessories, and we do not have an obligation to absorb losses or the right to receive benefits from FCOP that could potentially be significant. Our voting rights and management board representation approximate our ownership interest and we are unable to exercise control through voting interests or through other means. The operations of FCOP are primarily financed by the sale of planning products and accessories, and our primary exposure related to FCOP is from amounts owed to us by FCOP. We receive reimbursement from FCOP for certain operating costs and rental payments for the office space that FCOP occupies. We classify our receivables from FCOP based upon expected payment. Long-term receivable balances are discounted at 15 percent, which was the estimated risk-adjusted borrowing rate of FCOP. This rate was based on a variety of factors including, but not limited to, current market interest rates for various qualities of comparable debt, discussions with FCOP’s lenders, and an evaluation of the realizability of FCOP’s future cash flows. Receivables from FCOP are reported as components of other current and other long-term assets based on their expected payment dates and consisted of the following (in thousands):
Amounts receivable from FCOP are presented net of $0.3 million discount at August 31, 2018 and net of $0.7 million discount at August 31, 2017. CoveyLink Acquisition and Contractual Payments During fiscal 2009, we acquired the assets of CoveyLink Worldwide, LLC (CoveyLink). CoveyLink conducts training and provides consulting based upon the book The Speed of Trust by Stephen M.R. Covey, who is the brother of one of our executive officers. Prior to the acquisition date, CoveyLink had granted us a non-exclusive license for content related to The Speed of Trust book and related training courses for which we paid CoveyLink specified royalties. As part of the CoveyLink acquisition, an amended and restated license for intellectual property was signed that granted us an exclusive, perpetual, worldwide, transferable, royalty-bearing license to use, reproduce, display, distribute, sell, prepare derivative works of, and perform the licensed material in any format or medium and through any market or distribution channel. We are required to pay Stephen M.R. Covey royalties for the use of certain intellectual property developed by him. The amount expensed for these royalties totaled $1.8 million, $1.5 million, and $1.4 million during the fiscal years ended August 31, 2018, 2017, and 2016. As part of the acquisition of CoveyLink, we signed an amended license agreement as well as a speaker services agreement. Based on the provisions of the speakers’ services agreement, we pay Stephen M.R. Covey a portion of the speaking revenues received for his presentations. We expensed $0.9 million, $1.2 million, and $1.3 million for payment on these presentations during fiscal years 2018, 2017 and 2016. We had $0.7 million accrued for these royalties and speaking fees at each of August 31, 2018 and 2017, which were included as components of accrued liabilities in our consolidated balance sheets. Acquired License Rights for Intellectual Property During the third quarter of fiscal 2017, we acquired the license rights for certain intellectual property owned by Higher Moment, LLC for $0.8 million. The intellectual property is in part based on works authored and developed by Dr. Clayton Christensen, a well-known author and lecturer, who is a member of our Board of Directors. However, Dr. Christensen does not have an ownership interest in Higher Moment, LLC. The initial license period is five years and the agreement may be renewed for successive five-year periods for $0.8 million at each renewal date. The agreement may be terminated by either party at any time, but if we choose to terminate the agreement prior to the third renewal date, we are required to pay $0.3 million to Higher Moment, LLC. Other Related Party Transactions We pay an executive officer of the Company a percentage of the royalty proceeds received from the sales of certain books authored by him in addition to his annual salary. During the fiscal years ended August 31, 2018, 2017, and 2016, we expensed $0.2 million, $0.2 million, and $0.3 million for these royalties, and we had $0.1 million accrued at each of August 31, 2018 and 2017 as payable under the terms of these arrangements. These amounts are included as components of accrued liabilities in our consolidated balance sheets.
|
Nature Of Operations And Summary Of Significant Accounting Policies (Policy) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fiscal Year | Fiscal Year Our fiscal year ends on August 31 of each year. During fiscal 2017, our Board of Directors approved a change to our fiscal quarter ending dates from a modified 52/53-week calendar in which quarterly periods ended on different dates from year to year, to the last day of the calendar month in each quarter. Beginning with the second quarter of fiscal 2017, our fiscal quarters now end on the last day of November, February, and May. Unless otherwise noted, references to fiscal years apply to the 12 months ended August 31 of the specified year.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis Of Presentation | Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and our wholly-owned subsidiaries, which consist of Franklin Development Corp., and our offices in Japan, China, the United Kingdom, and Australia. Intercompany balances and transactions are eliminated in consolidation.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pervasiveness Of Estimates | Pervasiveness of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassifications | Reclassifications Certain reclassifications have been made to our prior period financial statements to conform with the current period presentation. On our consolidated balance sheet, we have separately classified deferred income tax assets and combined amounts receivable from FC Organizational Products (FCOP) with other current and other long-term assets (Note 17). On our consolidated statements of operations, we reclassified $0.2 million in each of the fiscal years ended August 31, 2017 and 2016 from interest income to the accretion of discount on related party receivables.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash And Cash Equivalents | Cash and Cash Equivalents Some of our cash is deposited with financial institutions located throughout the United States of America and at banks in foreign countries where we operate subsidiary offices, and at times may exceed insured limits. We consider all highly liquid debt instruments with a maturity date of three months or less to be cash equivalents. We did not hold a significant amount of investments that would be considered cash equivalent instruments at August 31, 2018 or 2017. Of our $10.2 million in cash at August 31, 2018, $8.9 million of it was held outside the U.S. by our foreign subsidiaries. We routinely repatriate cash from our foreign subsidiaries and consider cash generated from foreign activities a key component of our overall liquidity position.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value, cost being determined using the first-in, first-out method. Elements of cost in inventories generally include raw materials and direct labor. Cash flows from the sale of inventory are included in cash flows provided by operating activities in our consolidated statements of cash flows. Our inventories are comprised primarily of training materials, books, and training-related accessories, and consisted of the following (in thousands):
Provision is made to reduce excess and obsolete inventories to their estimated net realizable value. In assessing the valuation of inventories, we make judgments regarding future demand requirements and compare these estimates with current and committed inventory levels. Inventory requirements may change based on projected customer demand, training curriculum life-cycle changes, and other factors that could affect the valuation of our inventories. During fiscal 2017, we exited the publishing business in Japan (Note 12) and wrote off the majority of our book inventory located in Japan, which totaled $2.1 million. The cost of the books written off was recorded in cost of sales during fiscal 2017.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Current Assets | Other Current Assets Significant components of our other current assets were as follows (in thousands):
We defer commission expense on subscription-based sales and recognize the commission expense with the recognition of the corresponding revenue.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property And Equipment | Property and Equipment Property and equipment are recorded at cost. Depreciation expense, which includes depreciation on our corporate campus that is accounted for as a financing obligation (Note 6), and the amortization of assets recorded under capital lease obligations, is calculated using the straight-line method over the lesser of the expected useful life of the asset or the contracted lease period. We generally use the following depreciable lives for our major classifications of property and equipment:
Our property and equipment were comprised of the following (in thousands):
We expense costs for repairs and maintenance as incurred. Gains and losses resulting from the sale of property and equipment are recorded in operating income (loss). Depreciation of capitalized portal costs is included in depreciation expense in the accompanying consolidated statements of operations. During each of the fiscal years ended August 31, 2018 and 2017, we capitalized $0.1 million of interest expense in connection with the installation of our new enterprise resource planning system and the development of our new All Access Pass portal.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment Of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived tangible assets and finite-lived intangible assets are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We use an estimate of undiscounted future net cash flows of the assets over the remaining useful lives in determining whether the carrying value of the assets is recoverable. If the carrying values of the assets exceed the anticipated future cash flows of the assets, we recognize an impairment loss equal to the difference between the carrying values of the assets and their estimated fair values. Impairment of long-lived assets is assessed at the lowest levels for which there are identifiable cash flows that are independent from other groups of assets. The evaluation of long-lived assets requires us to use estimates of future cash flows. If forecasts and assumptions used to support the realizability of our long-lived tangible and finite-lived intangible assets change in the future, significant impairment charges could result that would adversely affect our results of operations and financial condition.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Indefinite-Lived Intangible Assets And Goodwill Impairment Testing | Indefinite-Lived Intangible Assets and Goodwill Impairment Testing Intangible assets that are deemed to have an indefinite life and acquired goodwill are not amortized, but rather are tested for impairment on an annual basis or more often if events or circumstances indicate that a potential impairment exists. The Covey trade name intangible asset has been deemed to have an indefinite life. This intangible asset is tested for impairment using qualitative factors or the present value of estimated royalties on trade name related revenues, which consist primarily of training seminars and work sessions, international licensee sales, and related products. Based on the fiscal 2018 evaluation of the Covey trade name, we believe the fair value of the Covey trade name substantially exceeds its carrying value. No impairment charges were recorded against the Covey trade name during the fiscal years ended August 31, 2018, 2017, or 2016. Goodwill is recorded when the purchase price for an acquisition exceeds the estimated fair value of the net tangible and identified intangible assets acquired. During August 2017, we adopted Accounting Standards Update (ASU) 2017-04, Intangibles—Goodwill and Other: Simplifying the Test for Goodwill Impairment. This guidance simplifies the subsequent measurement of goodwill and eliminates the two-step goodwill impairment test. Under the new guidance, an annual or interim goodwill impairment test is performed by comparing the fair value of a reporting unit with its carrying amount, and an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. The amendments also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and two-step goodwill impairment test. We tested goodwill for impairment at August 31, 2018 at the reporting unit level using a quantitative approach. The goodwill impairment testing process involves determining whether the estimated fair value of the reporting unit exceeds its respective book value. If the fair value exceeds the book value, goodwill of that reporting unit is not impaired. If the book value exceeds the fair value, an impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value. The estimated fair value of each reporting unit was calculated using a combination of the income approach (discounted cash flows) and the market approach (using market multiples derived from a set of companies with comparable market characteristics). On an interim basis, we consider whether events or circumstances are present that may lead to the determination that goodwill may be impaired. If, based on events or changing circumstances, we determine it is more likely than not that the fair value of a reporting unit does not exceed its carrying value, we would be required to test goodwill for impairment. Determining the fair value of a reporting unit is judgmental in nature and involves the use of significant estimates and assumptions. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, future economic and market conditions, and determination of appropriate market comparables. We base our fair value estimates on assumptions we believe to be reasonable, but that are unpredictable and inherently uncertain. Actual future results may differ from those estimates. In addition, we make certain judgments and assumptions in allocating shared assets and liabilities to determine the carrying values for each of our reporting units. The timing and frequency of our goodwill impairment tests are based on an ongoing assessment of events and circumstances that would indicate a possible impairment. Based on the results of our goodwill impairment testing, we determined that no impairment existed at either of August 31, 2018 or 2017 as each reporting unit’s estimated fair value exceeded its carrying value. We will continue to monitor our goodwill and intangible assets for impairment and conduct formal tests when impairment indicators are present. For more information regarding our intangible assets and goodwill, refer to Note 4.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Capitalized Curriculum Development Costs | Capitalized Curriculum Development Costs During the normal course of business, we develop training courses and related materials that we sell to our clients. Capitalized curriculum development costs include certain expenditures to develop course materials such as video segments, course manuals, and other related materials. Our capitalized curriculum development spending in fiscal 2018, which totaled $3.0 million, was primarily for offerings related to the All Access Pass, including The Four Essential Roles of Leadership, and for various other offerings in our Education practice. Curriculum costs are capitalized when there is a major revision to an existing course that requires a significant re-write of the course materials. Costs incurred to maintain existing offerings are expensed when incurred. In addition, development costs incurred in the research and development of new offerings and software products to be sold, leased, or otherwise marketed are expensed as incurred until economic and technological feasibility has been established. Capitalized development costs are amortized over three- to five-year useful lives, which are based on numerous factors, including expected cycles of major changes to our content. Capitalized curriculum development costs are reported as a component of other long-term assets in our consolidated balance sheets and totaled $9.3 million and $11.6 million at August 31, 2018 and 2017. Amortization of capitalized curriculum development costs is reported as a component of cost of sales in the accompanying consolidated statements of operations.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities | Accrued Liabilities Significant components of our accrued liabilities were as follows (in thousands):
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingent Consideration Payments From Business Acquisitions | Contingent Consideration Payments from Business Acquisitions Business acquisitions may include contingent consideration payments based on various future financial measures related to the acquired entity. Contingent consideration is required to be recognized at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the acquired company and estimated probabilities of achievement. Based on updated estimates and projections, the contingent consideration liabilities are adjusted at each reporting date to their estimated fair value. Changes in fair value subsequent to the acquisition date are reported in selling, general, and administrative expense in our consolidated statements of operations, and may have a material impact on our operating results. Variations in the fair value of contingent consideration liabilities may result from changes in discount periods or rates, changes in the timing and amount of earnings estimates, and changes in probability assumptions with respect to the likelihood of achieving various payment criteria.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Foreign Currency Translation And Transactions | Foreign Currency Translation and Transactions The functional currencies of our foreign operations are the reported local currencies. Translation adjustments result from translating our foreign subsidiaries’ financial statements into United States dollars. The balance sheet accounts of our foreign subsidiaries are translated into United States dollars using the exchange rate in effect at the balance sheet dates. Revenues and expenses are translated using average exchange rates for each month during the fiscal year. The resulting translation differences are recorded as a component of accumulated other comprehensive income in shareholders’ equity. Foreign currency transaction losses totaled $0.5 million, $0.2 million, and $0.3 million for the fiscal years ended August 31, 2018, 2017, and 2016, respectively, and are included as a component of selling, general, and administrative expenses in our consolidated statements of operations.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Sales Taxes | Sales Taxes We collect sales tax on qualifying transactions with customers based upon applicable sales tax rates in various jurisdictions. We account for sales taxes collected using the net method; accordingly, we do not include sales taxes in net sales reported in our consolidated statements of operations.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition We recognize revenue when: 1) persuasive evidence of an arrangement exists, 2) delivery of the product has occurred or services have been rendered, 3) the price to the customer is fixed or determinable, and 4) collectability is reasonably assured. For training and service sales, these conditions are generally met upon presentation of the training seminar or delivery of the consulting services based upon daily rates. For most of our product sales, these conditions are met upon shipment of the product to the customer. At times, our customers may request access to our intellectual property for the flexibility to print certain training materials or to have access to certain training videos and other training aids at their convenience. For intellectual property license sales, the revenue recognition conditions are generally met at the later of delivery of the content to the client or the effective date of the arrangement. Revenue recognition for multiple-element arrangements requires judgment to determine if multiple elements exist, whether elements can be accounted for as separate units of accounting, and if so, the fair value for each of the elements. A deliverable constitutes a separate unit of accounting when it has standalone value to our clients. We routinely enter into arrangements that can include various combinations of multiple training offerings, consulting services, and intellectual property licenses. The timing of delivery and performance of the elements typically varies from contract to contract. Generally, these items qualify as separate units of accounting because they have value to the customer on a standalone basis. When the Company’s training and consulting arrangements contain multiple deliverables, consideration is allocated at the inception of the arrangement to all deliverables based on their relative selling prices at the beginning of the agreement, and revenue is recognized as each offering, consulting service, or intellectual property license is delivered. We use the following selling price hierarchy to determine the fair value to be used for allocating revenue to the elements: (i) vendor-specific objective evidence of fair value (VSOE), (ii) third-party evidence (TPE), and (iii) best estimate of selling price (BESP). Generally, VSOE is based on established pricing and discounting practices for the deliverables when sold separately. In determining VSOE, we require that a substantial majority of the selling prices fall within a narrow range. When VSOE cannot be established, judgment is applied with respect to whether a selling price can be established based on TPE, which is determined based on competitor prices for similar offerings when sold separately. Our products and services normally contain a significant level of differentiation such that the comparable pricing of services with similar functionality cannot be obtained. When we are unable to establish a selling price using VSOE or TPE, BESP is used in our allocation of arrangement consideration. BESPs are established as best estimates of what the selling price would be if the deliverables were sold regularly on a stand-alone basis. Our process for determining BESPs requires judgment and considers multiple factors, such as market conditions, type of customer, geographies, stage of product lifecycle, internal costs, and gross margin objectives. These factors may vary over time depending upon the unique facts and circumstances related to each deliverable. However, we do not expect the effect of changes in the selling price or method or assumptions used to determine selling price to have a significant effect on the allocation of arrangement consideration. Our multiple-element arrangements generally do not include performance, cancellation, termination, or refund-type provisions. Our international strategy includes the use of licensees in countries where we do not have a wholly-owned direct office. Licensee companies are unrelated entities that have been granted a license to translate our content and offerings, adapt the content to the local culture, and sell our content in a specific country or region. Licensees are required to pay us royalties based upon a percentage of their sales to clients. We recognize royalty income each period based upon the sales information reported to us from our licensees. Licensee royalty revenues are included as a component of training sales and totaled $10.7 million, $10.6 million, and $14.4 million for the fiscal years ended August 31, 2018, 2017, and 2016. The decrease in international licensee royalties in fiscal 2017 was primarily due to the conversion of our licensee operations in China into directly-owned offices. Revenue is recognized as the net amount to be received after deducting estimated amounts for discounts and product returns.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation We record the compensation expense for all stock-based payments, including grants of stock options and the compensatory elements of our employee stock purchase plan, in our consolidated statements of operations based upon their fair values over the requisite service period. For more information on our stock-based compensation plans, refer to Note 11.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shipping And Handling Fees And Costs |
Shipping and Handling Fees and Costs All shipping and handling fees billed to customers are recorded as a component of net sales. All costs incurred related to the shipping and handling of products are recorded in cost of sales.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Advertising Costs | Advertising Costs Costs for advertising are expensed as incurred. Advertising costs included in selling, general, and administrative expenses totaled $6.9 million, $6.4 million, and $6.6 million for the fiscal years ended August 31, 2018, 2017, and 2016.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes Our income tax provision has been determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred income taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The income tax provision represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred income taxes result from differences between the financial and tax bases of our assets and liabilities and are adjusted for tax rates and tax laws when changes are enacted. A valuation allowance is provided against deferred income tax assets when it is more likely than not that all or some portion of the deferred income tax assets will not be realized. Interest and penalties related to uncertain tax positions are recognized as components of income tax benefit or expense in our consolidated statements of operations. We may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement. We provide for income taxes, net of applicable foreign tax credits, on temporary differences in our investment in foreign subsidiaries, which consist primarily of unrepatriated earnings.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income | Comprehensive Income Comprehensive income includes changes to equity accounts that were not the result of transactions with shareholders. Comprehensive income is comprised of net income or loss and other comprehensive income and loss items. Our other comprehensive income and losses generally consist of changes in the cumulative foreign currency translation adjustment, net of tax.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Pronouncements Issued And Adopted | Accounting Pronouncements Issued and Adopted In March 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-09, Compensation - Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting. The guidance in ASU 2016-09 simplifies several aspects of the accounting for stock-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification of items on the statement of cash flows. The guidance in ASU 2016-09 is effective for public companies’ annual periods, including interim periods within those fiscal years, beginning after December 15, 2016. We adopted the provisions of ASU 2016-09 on September 1, 2017 on a prospective basis and prior periods have not been restated for these amendments. The primary impact of adopting this guidance on our financial statements has been the classification of excess income tax benefits or expense in income taxes rather than as a component of additional paid-in capital. The adoption of ASU 2016-09 did not have a material impact on our financial statements in fiscal 2018.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Pronouncements Issued Not Yet Adopted |
Accounting Pronouncements Issued Not Yet Adopted On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). This new standard was issued in conjunction with the International Accounting Standards Board (IASB) and is designed to create a single, principles-based process by which all businesses calculate revenue. The core principle of this standard is that an entity should recognize revenue for the transfer of goods or services equal to the amount that it expects to be entitled to receive for those goods or services. The standard also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. The new standard replaces numerous individual, industry-specific revenue rules found in generally accepted accounting principles in the United States. We will adopt this standard on September 1, 2018 and apply the new guidance during interim periods within fiscal 2019. We plan to adopt ASU No. 2014-09 using the “modified retrospective” approach. Based upon our analysis of Topic 606, we expect that revenue recognition among our products and services will remain largely unchanged except for our initial license fee associated with licensing an international location. The Company currently records the non-refundable initial license fee from licensing an international location as revenue at the time the license period begins if all other revenue requirements have been met. However, under Topic 606, we have concluded that initial upfront fees should be recognized over the course of the initial contract. Under Topic 606, we will account for the All Access Pass (AAP) as a single performance obligation and recognize the associated transaction price on a straight-line basis over the term of the underlying contract. This determination was reached after considering that our web-based functionality and content, in combination with our intellectual property, each represent inputs that transform into a combined output that represents the intended outcome of the AAP, which is to provide a continuously accessible, customized, and dynamic learning and development solution only accessible through the AAP platform. We do not expect the accounting for fulfillment costs or costs incurred to obtain a contract to be affected materially in any period due to the adoption of Topic 606. Although the Company is still finalizing its analysis of the adoption of Topic 606, we estimate that the initial impact upon adoption will be a reduction to the opening balance of retained earnings with offsetting amounts recorded to deferred revenue and deferred tax asset in an amount between $2 million and $4 million. We do not expect the adoption of ASU 2014-09 to have any impact on our operating cash flows. On February 25, 2016, the FASB issued ASU No. 2016-02, Leases. The new lease accounting standard is the result of a collaborative effort with the IASB (similar to the new revenue standard described above), although some differences remain between the two standards. This new standard will affect all entities that lease assets and will require lessees to recognize a lease liability and a right-of-use asset for all leases (except for short-term leases that have a duration of less than one year) as of the date on which the lessor makes the underlying asset available to the lessee. For lessors, accounting for leases is substantially the same as in prior periods. For public companies, the new lease standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption is permitted for all entities. We expect to adopt the provisions of ASU 2016-02 on September 1, 2019, and we may elect to apply the new standard on a prospective basis. At August 31, 2018, our leases primarily consist of the lease on our corporate campus, which is accounted for as a financing obligation (Note 6) on our consolidated balance sheets and operating leases for office and warehousing space. We expect the adoption of this new standard will increase our reported assets and liabilities since we will record the lease obligation and a corresponding right of use asset on our balance sheet for leases that are currently accounted for as operating leases (Note 7). However, as of August 31, 2018, we have not yet elected the transition method or determined the full impact that the adoption of ASU 2016-02 will have on our consolidated financial statements.
|
Nature Of Operations And Summary Of Significant Accounting Policies (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components Of Inventories |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components Other Current Assets |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Useful Life Of Property And Equipment |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property And Equipment |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities |
|
Business Acquisitions (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Pro Forma |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Robert Gregory Partners [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Total Purchase Price |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Estimated Fair Values Of Assets Acquired, Liabilities Assumed, and Identifiable Intangible Assets |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Assets Acquired Amortized Over Estimated Useful Lives |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Jhana Education [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Total Purchase Price |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Estimated Fair Values Of Assets Acquired, Liabilities Assumed, and Identifiable Intangible Assets |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Assets Acquired Amortized Over Estimated Useful Lives |
|
Accounts Receivable (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Receivable [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Activity In Allowance For Doubtful Accounts |
|
Intangible Assets And Goodwill (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets And Goodwill [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Intangible Assets |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Range Of Remaining Estimated Useful Lives And Weighted-Average Amortization |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization Expense For Intangible Assets Over The Next Five Years |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consolidated Goodwill |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Allocated Goodwill To Reportable Operating Segments |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Reclassified Goodwill From Strategic Market To Direct Office Segment |
|
Term Loans Payable And Revolving Line Of Credit (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Term Loans Payable And Revolving Line Of Credit [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Information Of Term Loans Payable |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Principal Payments By Fiscal Year |
|
Financing Obligation (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Obligation [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Obligation |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Future Principal Maturities |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Future Minimum Payments Under The Financing Obligation |
|
Operating Leases (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||
Operating Leases [Abstract] | ||||||||||||||||||||||||||||||||||
Future Minimum Lease Payments Under Operating Lease Agreements And The Lease Amounts Receivable |
|
|||||||||||||||||||||||||||||||||
Future Minimum Lease Payments Due To Company |
|
Fair Value Of Financial Instruments (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Of Financial Instruments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Contingent Consideration Liabilities |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Growth Rates To Fair Value Contingent Consideration |
|
Stock-Based Compensation Plans (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation Plans [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Cost Of Share-Based Compensation |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unvested Stock Awards |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Option Activity |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Options Outstanding And Exercisable |
|
Contract Termination And Restructuring Costs (Tables) |
12 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||
U.S./Canada Direct Office Restructuring [Member] | |||||||||||||||||||||||||
Schedule Of Restructuring Charges |
|
Income Taxes (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Benefit (Provision) For Income Taxes From Continuing Operations |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allocation Of Total Income Tax Provision (Benefit) |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income (Loss) From Continuing Operations Before Income Taxes |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Differences Between Income Taxes At The Statutory Federal Income Tax Rate And Income Taxes From Continuing Operations |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Components Of Deferred Tax Assets And Liabilities |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Income Tax Amounts Recorded On The Consolidated Balance Sheets |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Operating Loss Carryforwards |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary Of Tax Credit Carryforwards |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation Of The Beginning And Ending Amount Of Gross Unrecognized Tax Benefits |
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tax Years That Remain Subject To Examinations For Major Tax Jurisdictions |
|
Earnings (Loss) Per Share (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (Loss) Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation Of EPS |
|
Segment Information (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Segment Operations |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation Of Adjusted EBITDA |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Consolidated Revenues From Continuing Operations By Country |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-Lived Assets By Country |
|
Related Party Transactions (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Aug. 31, 2018 | |||||||||||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||||||||||
Components Of Other Current And Other Long-Term Assets |
|
Nature Of Operations And Summary Of Significant Accounting Policies (Components Of Inventories) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | ||
Finished goods | $ 3,130 | $ 3,306 |
Raw materials | 30 | 47 |
Inventories | $ 3,160 | $ 3,353 |
Nature Of Operations And Summary Of Significant Accounting Policies (Components Other Current Assets) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Other current assets | $ 10,893 | $ 9,387 |
Deferred Commissions [Member] | ||
Other current assets | 6,958 | 6,150 |
Other Current Assets [Member] | ||
Other current assets | $ 3,935 | $ 3,237 |
Nature Of Operations And Summary Of Significant Accounting Policies (Useful Life Of Property And Equipment) (Details) |
12 Months Ended |
---|---|
Aug. 31, 2018 | |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 20 years |
Machinery And Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Machinery And Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 7 years |
Computer Hardware And Software [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 3 years |
Computer Hardware And Software [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture, Fixtures, And Leasehold Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture, Fixtures, And Leasehold Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful life | 7 years |
Nature Of Operations And Summary Of Significant Accounting Policies (Property And Equipment) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 68,411 | $ 64,441 |
Less accumulated depreciation | (47,010) | (44,711) |
Property and equipment | 21,401 | 19,730 |
Land And Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,312 | 1,312 |
Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 30,038 | 30,044 |
Machinery And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,723 | 2,119 |
Computer Hardware And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 27,066 | 22,647 |
Furniture, Fixtures, And Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 8,272 | $ 8,319 |
Nature Of Operations And Summary Of Significant Accounting Policies (Accrued Liabilities) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract] | ||
Accrued compensation | $ 11,858 | $ 10,611 |
Other accrued liabilities | 8,903 | 12,006 |
Accrued liabilities | $ 20,761 | $ 22,617 |
Business Acquisitions (Schedule Of Total Purchase Price) (Details) - USD ($) $ in Thousands |
Jul. 11, 2017 |
May 15, 2017 |
---|---|---|
Robert Gregory Partners [Member] | ||
Business Acquisition [Line Items] | ||
Cash paid | $ 3,500 | |
Fair value of contingent consideration | 1,413 | |
Total purchase price | $ 4,913 | |
Jhana Education [Member] | ||
Business Acquisition [Line Items] | ||
Cash paid | $ 3,525 | |
Fair value of contingent consideration | 6,052 | |
Total purchase price | $ 9,577 |
Business Acquisitions (Schedule Of Pro Forma) (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
---|---|---|
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Business Acquisitions [Abstract] | ||
Revenue | $ 187,745 | $ 204,505 |
Net income (loss) | $ (7,976) | $ 4,863 |
Diluted earnings (loss) per share | $ (0.58) | $ 0.32 |
Accounts Receivable (Narrative) (Details) |
12 Months Ended |
---|---|
Aug. 31, 2018 | |
Accounts Receivable [Abstract] | |
Period of trade accounts receivable past due over, collectibility review | 90 days |
Accounts Receivable (Activity In Allowance For Doubtful Accounts) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Accounts Receivable [Abstract] | |||
Beginning balance | $ 2,310 | $ 1,579 | $ 1,333 |
Charged to costs and expenses | 2,029 | 1,747 | 2,022 |
Deductions | (784) | (1,016) | (1,776) |
Ending balance | $ 3,555 | $ 2,310 | $ 1,579 |
Intangible Assets And Goodwill (Narrative) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Intangible Assets And Goodwill [Abstract] | |||
Aggregate amortization expense from finite-lived intangible assets | $ 5.4 | $ 3.5 | $ 3.3 |
Intangible Assets And Goodwill (Amortization Expense For Intangible Assets Over The Next Five Years) (Details) $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Intangible Assets And Goodwill [Abstract] | |
2019 | $ 4,790 |
2020 | 4,324 |
2021 | 3,809 |
2022 | 3,498 |
2023 | $ 2,612 |
Intangible Assets And Goodwill (Consolidated Goodwill) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
|
Beginning balance, Goodwill | $ 24,220 | $ 19,903 |
Accumulated impairments | ||
Ending balance, Goodwill | $ 24,220 | 24,220 |
Robert Gregory Partners [Member] | ||
Acquisition of (Note 2) | 1,232 | |
Jhana Education [Member] | ||
Acquisition of (Note 2) | $ 3,085 |
Intangible Assets And Goodwill (Schedule Of Allocated Goodwill To Reportable Operating Segments) (Details) $ in Thousands |
Aug. 31, 2017
USD ($)
|
---|---|
Goodwill [Line Items] | |
Allocated Goodwill | $ 4,317 |
Direct Offices [Member] | |
Goodwill [Line Items] | |
Allocated Goodwill | 2,592 |
Strategic Markets [Member] | |
Goodwill [Line Items] | |
Allocated Goodwill | 513 |
Education Practice [Member] | |
Goodwill [Line Items] | |
Allocated Goodwill | 154 |
International Licensees [Member] | |
Goodwill [Line Items] | |
Allocated Goodwill | $ 1,058 |
Intangible Assets And Goodwill (Schedule Of Reclassified Goodwill From Strategic Market To Direct Office Segment) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Goodwill [Line Items] | |||
Goodwill | $ 24,220 | $ 24,220 | $ 19,903 |
Direct Offices [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 16,825 | 13,382 | |
Adjusted Goodwill | 3,443 | ||
Strategic Markets [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 3,443 | ||
Adjusted Goodwill | (3,443) | ||
Education Practice [Member] | |||
Goodwill [Line Items] | |||
Goodwill | 2,330 | 2,330 | |
International Licensees [Member] | |||
Goodwill [Line Items] | |||
Goodwill | $ 5,065 | $ 5,065 |
Term Loans Payable And Revolving Line Of Credit (Information Of Term Loans Payable) (Details) |
12 Months Ended |
---|---|
Aug. 31, 2018
USD ($)
| |
Outstanding Principal | $ 12,813,000 |
Term Loan May 24, 2019 [Member] | |
Maturity Date | May 24, 2019 |
Original Principal Amount | $ 15,000,000 |
Quarterly Principal Payment Amount | 938,000 |
Outstanding Principal | $ 6,563,000 |
Term Loan August 29, 2019 [Member] | |
Maturity Date | Aug. 29, 2019 |
Original Principal Amount | $ 5,000,000 |
Quarterly Principal Payment Amount | 313,000 |
Outstanding Principal | $ 2,500,000 |
Term Loan August 29, 2020 [Member] | |
Maturity Date | Aug. 29, 2020 |
Original Principal Amount | $ 5,000,000 |
Quarterly Principal Payment Amount | 313,000 |
Outstanding Principal | $ 3,750,000 |
Term Loans Payable And Revolving Line Of Credit (Principal Payments By Fiscal Year) (Details) - Term Loan [Member] $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Debt Instrument [Line Items] | |
2019 | $ 10,313 |
2020 | 2,500 |
Total | $ 12,813 |
Financing Obligation (Narrative) (Details) $ in Millions |
12 Months Ended |
---|---|
Aug. 31, 2018
USD ($)
item
| |
Financing Obligation [Abstract] | |
Duration of master lease agreement | 20 years |
Number of renewal options | item | 6 |
Duration of renewal options | 5 years |
Maximum duration of lease agreement | 50 years |
Carrying value of the land sold in the financing transaction | $ | $ 1.3 |
Financing Obligation (Financing Obligation) (Details) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
|
Financing Obligation [Abstract] | ||
Financing obligation payable in monthly installments of $303 at August 31, 2018, including principal and interest, with two percent annual increases (imputed interest at 7.7%), through June 2025 | $ 21,075 | $ 22,943 |
Less current portion | (2,092) | (1,868) |
Total financing obligation, less current portion | 18,983 | $ 21,075 |
Monthly payment of financing obligation | $ 303 | |
Annual increase to base payment | 2.00% | |
Imputed interest | 7.70% | |
Expiration date | June 2025 |
Financing Obligation (Future Principal Maturities) (Details) - Financing Obligation [Member] $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Future Principal Maturities Financing Obligation [Line Items] | |
2019 | $ 2,092 |
2020 | 2,335 |
2021 | 2,600 |
2022 | 2,887 |
2023 | 3,199 |
Thereafter | 7,962 |
Total | $ 21,075 |
Financing Obligation (Future Minimum Payments Under The Financing Obligation) (Details) $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Financing Obligation [Abstract] | |
2019 | $ 3,651 |
2020 | 3,724 |
2021 | 3,798 |
2022 | 3,874 |
2023 | 3,952 |
Thereafter | 7,331 |
Total future minimum financing obligation payments | 26,330 |
Less interest | (6,567) |
Present value of future minimum financing obligation payments | $ 19,763 |
Operating Leases (Narrative) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Operating Leased Assets [Line Items] | |||
Total rent expense | $ 1.6 | $ 1.8 | $ 2.2 |
Cost basis of office space available for lease | 34.8 | ||
Carrying value of office space available for lease | 7.6 | ||
Sublease revenue | $ 3.5 | $ 3.6 | $ 4.4 |
Minimum [Member] | |||
Operating Leased Assets [Line Items] | |||
Operating lease term | 1 year | ||
Maximum [Member] | |||
Operating Leased Assets [Line Items] | |||
Operating lease term | 7 years | ||
FC Organizational Products [Member] | |||
Operating Leased Assets [Line Items] | |||
Lease income | $ 0.6 |
Operating Leases (Future Minimum Lease Payments Under Operating Lease Agreements And The Lease Amounts Receivable) (Details) $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Operating Leases [Abstract] | |
2019 | $ 865 |
2020 | 415 |
2021 | 231 |
2022 | 85 |
2023 | 85 |
Thereafter | 184 |
Total | $ 1,865 |
Operating Leases (Future Minimum Lease Payments Due To Company) (Details) $ in Thousands |
Aug. 31, 2018
USD ($)
|
---|---|
Operating Leases [Abstract] | |
2019 | $ 3,789 |
2020 | 3,888 |
2021 | 2,340 |
2022 | 1,514 |
2023 | 1,514 |
Thereafter | 2,802 |
Total | $ 15,847 |
Commitments And Contingencies (Narrative) (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Jul. 01, 2016 |
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
HPE outsourcing contract, fixed charge per month | $ 19 | |||
HPE outsourcing contract, expiration date | Jun. 30, 2019 | |||
HPE outsourcing contract, expense | $ 2,900 | $ 2,600 | $ 3,800 | |
Cost of sales | 61,469 | 62,589 | 64,901 | |
Purchase commitments | 4,300 | |||
Amount of letters of credit | $ 100 | 100 | ||
Letters of credit, expiration date | Jan. 01, 2019 | |||
Amount drawn on letters of credit | $ 0 | 0 | ||
Freight [Member] | ||||
Cost of sales | $ 1,900 | $ 1,500 | $ 1,800 |
Fair Value Of Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
Jul. 11, 2017 |
May 15, 2017 |
---|---|---|---|---|
Contingent consideration | $ 4,548 | $ 6,965 | ||
Robert Gregory Partners [Member] | ||||
Contingent consideration | 606 | 913 | $ 4,500 | |
Jhana Education [Member] | ||||
Contingent consideration | $ 3,942 | $ 6,052 | $ 7,200 |
Fair Value Of Financial Instruments (Schedule Of Contingent Consideration Liabilities) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Business Acquisition, Contingent Consideration [Line Items] | |||
Contingent consideration liability at beginning of year | $ 6,965 | ||
Increase in Fair Value | 1,014 | $ (1,936) | $ 1,538 |
Payments | (3,431) | ||
Contingent consideration liability at end of year | 4,548 | 6,965 | |
Robert Gregory Partners [Member] | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Contingent consideration liability at beginning of year | 913 | ||
Increase in Fair Value | 693 | ||
Payments | (1,000) | ||
Contingent consideration liability at end of year | 606 | 913 | |
Jhana Education [Member] | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Contingent consideration liability at beginning of year | 6,052 | ||
Increase in Fair Value | 321 | ||
Payments | (2,431) | ||
Contingent consideration liability at end of year | $ 3,942 | $ 6,052 |
Stock-Based Compensation Plans (Total Cost Of Share-Based Compensation) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost | $ 2,846 | $ 3,658 | $ 3,121 |
Performance Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost | 2,034 | 2,902 | 2,492 |
Unvested Stock Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost | 642 | 500 | 450 |
Fully Vested Stock Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost | 15 | 135 | 60 |
Employee Stock Purchase Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost | $ 155 | $ 121 | $ 119 |
Stock-Based Compensation Plans (Unvested Stock Awards) (Details) - Unvested Stock Awards [Member] |
12 Months Ended |
---|---|
Aug. 31, 2018
$ / shares
shares
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unvested stock awards at August 31, 2017, Number of Shares | shares | 29,834 |
Granted, Number of Shares | shares | 23,338 |
Forfeited, Number of Shares | shares | |
Vested, Number of Shares | shares | (29,834) |
Unvested stock awards at August 31, 2018, Number of Shares | shares | 23,338 |
Unvested stock awards at August 31, 2017, Weighted-Average Grant Date Fair Value Per Share | $ / shares | $ 17.60 |
Granted, Weighted-Average Grant Date Fair Value Per Share | $ / shares | 30.00 |
Forfeited, Weighted-Average Grant Date Fair Value Per Share | $ / shares | |
Vested, Weighted-Average Grant Date Fair Value Per Share | $ / shares | 17.60 |
Unvested stock awards at August 31, 2018, Weighted-Average Grant Date Fair Value Per Share | $ / shares | $ 30.00 |
Contract Termination And Restructuring Costs (Schedule Of Restructuring Charges) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Total restructuring charge | $ 1,482 | $ 776 | |
Fiscal 2017 Restructuring Costs [Member] | |||
Total restructuring charge | $ 3,600 | ||
US and Canada Direct Office Restructuring [Member] | Fiscal 2017 Restructuring Costs [Member] | |||
Severance costs | $ 986 | ||
Office closure costs | 496 | ||
Total restructuring charge | $ 1,482 |
Employee Benefit Plans (Narrative) (Details) - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Employee Benefit Plans [Abstract] | |||
Maximum percent of gross wages employees may contribute | 75.00% | ||
Matching contributions | $ 2.1 | $ 1.9 | $ 1.9 |
Value of shares of common stock owned by remaining plan participants in deferred compensation plan | $ 0.2 | $ 0.4 |
Income Taxes (Benefit (Provision) For Income Taxes From Continuing Operations) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Income Taxes [Abstract] | |||
Current, Federal | $ 29 | $ 69 | $ (380) |
Current, State | 210 | (71) | (197) |
Current, Foreign | (2,947) | (2,320) | (2,553) |
Current | (2,708) | (2,322) | (3,130) |
Deferred, Federal | 1,426 | (1,227) | (1,584) |
Deferred, State | (314) | (17) | 70 |
Deferred, Foreign | (281) | 468 | 50 |
Operating loss carryforward | 2,636 | 6,964 | |
Adjustment for changes in U.S. income tax rates | 1,654 | ||
Valuation allowance | (2,780) | (129) | (301) |
Deferred | 2,341 | 6,059 | (1,765) |
Benefit (provision) for income taxes | $ (367) | $ 3,737 | $ (4,895) |
Income Taxes (Allocation Of Total Income Tax Provision(Benefit)) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Income Taxes [Abstract] | |||
Net income (loss) | $ (367) | $ 3,737 | $ (4,895) |
Other comprehensive income | (75) | 37 | 115 |
Total income tax provision (benefit) | $ (442) | $ 3,774 | $ (4,780) |
Income Taxes (Income (Loss) From Continuing Operations Before Income Taxes) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Income Taxes [Abstract] | |||
United States | $ (8,960) | $ (10,126) | $ 9,328 |
Foreign | 3,440 | (783) | 2,583 |
Income (loss) before income taxes | $ (5,520) | $ (10,909) | $ 11,911 |
Income Taxes (Differences Between Income Taxes At The Statutory Federal Income Tax Rate And Income Taxes From Continuing Operations) (Details) |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Income Taxes [Abstract] | |||
Federal statutory income tax rate | 25.70% | 35.00% | (35.00%) |
State income taxes, net of federal effect | 2.60% | 2.30% | (1.90%) |
Effect of change in U.S. federal tax rate | 30.00% | ||
Valuation allowance | (50.40%) | (1.20%) | (2.50%) |
Foreign jurisdictions tax differential | (6.80%) | (1.90%) | 0.60% |
Tax differential on income subject to both U.S. and foreign taxes | 2.30% | 0.40% | (1.90%) |
Uncertain tax positions | (5.10%) | 4.40% | 0.40% |
Non-deductible executive compensation | (2.70%) | (1.60%) | |
Non-deductible meals and entertainment | (8.90%) | (2.20%) | (1.60%) |
Payout of deferred compensation (NQDC) | 4.40% | ||
Other | 2.20% | (0.90%) | 0.80% |
Income tax rate | (6.70%) | 34.30% | (41.10%) |
Income Taxes (Deferred Income Tax Amounts Recorded On The Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Income Taxes [Abstract] | ||
Long-term assets | $ 3,222 | $ 1,647 |
Long-term liabilities | (210) | (1,033) |
Net deferred income taxes asset | $ 3,012 | $ 614 |
Income Taxes (Reconciliation Of The Beginning And Ending Amount Of Gross Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Income Taxes [Abstract] | |||
Beginning balance | $ 2,359 | $ 3,024 | $ 3,115 |
Additions based on tax positions related to the current year | 27 | 10 | 199 |
Additions for tax positions in prior years | 367 | 85 | 3 |
Reductions for tax positions of prior years resulting from the lapse of applicable statute of limitations | (253) | (634) | (212) |
Other reductions for tax positions of prior years | (389) | (126) | (81) |
Ending balance | $ 2,111 | $ 2,359 | $ 3,024 |
Earnings (Loss) Per Share (Narrative) (Details) shares in Millions |
12 Months Ended |
---|---|
Aug. 31, 2018
shares
| |
Earnings (Loss) Per Share [Abstract] | |
Pontentially dilutive securities were included in the calculation of diluted loss per share | 0.0 |
Dilutive securities that was included in the computation of diluted EPS | 0.2 |
Earnings (Loss) Per Share (Computation Of EPS) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Aug. 31, 2018 |
Aug. 31, 2017 |
Aug. 31, 2016 |
|
Numerator for basic and diluted earnings per share: | |||
Net income (loss) | $ (5,887) | $ (7,172) | $ 7,016 |
Denominator for basic and diluted earnings per share: | |||
Basic weighted average shares outstanding | 13,849 | 13,819 | 14,944 |
Effect of dilutive securities: | |||
Stock options and other stock-based awards | 132 | ||
Diluted weighted average shares outstanding | 13,849 | 13,819 | 15,076 |
EPS Calculations: | |||
Basic and diluted | $ (0.43) | $ (0.52) | $ 0.47 |
Segment Information (Long-Lived Assets By Country) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 37,109 | $ 36,655 |
United States/Canada [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 34,237 | 33,146 |
Japan [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 1,450 | 2,350 |
China [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 581 | 301 |
Singapore [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 315 | 152 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | 276 | 240 |
Australia [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-Lived Assets | $ 250 | $ 466 |
Related Party Transactions (Components Of Other Current And Other Long-Term Assets) (Details) - USD ($) $ in Thousands |
Aug. 31, 2018 |
Aug. 31, 2017 |
---|---|---|
Other Assets [Line Items] | ||
Other current assets | $ 10,893 | $ 9,387 |
Other long-term assets | 12,935 | 16,005 |
FCOP [Member] | ||
Other Assets [Line Items] | ||
Other current assets | 1,123 | 1,020 |
Other long-term assets | 411 | 727 |
Other assets | $ 1,534 | $ 1,747 |
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
M@$? <\<
M!KLXHU#)1>N78'RK 0NKU3P++0Y7MTA
MN!5" <'AJ.TT-7,YOBSC0HM^>C3)_'*7_P%02P,$% @
M8VUN3=\R&KDG @ F@8 !D !X;"]W;W)K O!4RP0RF7\FDA099Z/#I[T?
MB/[%_A&KO2GUI-D*LZ:2%VKV7L1AD*&[-IHUITF#5YHP3A<-4OX+!%LAV!@$
M*P/L!7:#P&H0&(/(&/2S@9]NTIQ$AY4HB2,[);120@L%>QO*7A3Z3RB1E1+9
M*/Z&8A$%OIT26RFQC8(WE+TH>5+*P0HYV"#;T[,7/8,D5DABXL/U"<7;7Y_L
M&'X2VB&I%9+N(/[J[$R0='>^_/T!0ZN+I]^U'X1?VUXX%R;5'38WK69,@C+T
M7E3"C7I*EP&%6NKN0?7Y]*!, \F&^:U$RX-=_ =02P,$% @ 8VUN3900
M&8( @ Q04 !D !X;"]W;W)K D6@HO8P0 S
M'6#VIDAN%=EI(JTIM2::)W$4XCP1S!.!/#,K3_2A/'.89P[R.!H2PP#Q](XF
M,$ "5C"W*NTT\:#2!4ZQ@"D6$U[:8M3,.46AHY 9/JI^IV(2]U([\B5OM_V%IXY5Z!-KAYT
M.RL]R,<#A;,RVU3O13_.^H/B[3"IT?BY*/X!4$L#!!0 ( &-M;DVP7IZ"
M,P( $,& 9 >&PO=V]R:W-H965T+[<>,'RA FN!)*
]@(
M\,_.AJ[^GG79>MG4IT5SKM8QZR>%>&0]F-O^Y3!VPV^ZMZU^^[X.1;CTW_M$
MH^;IK*$K#4T5&UO!T47B:P,7%P1=T!#/$Q>.! P3\)! 3A+$1C?.FGC05(-&
MB(B#R.@+E%&:8#L2VI' 3F+8.6O"JW8>DIAC
X/L#]#O"O!O@^P)^:
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M!2<*.%$ B<1HF>XUZ2"1&
@T0'..218?@S(SSK2,WOWF]AG.(!R[BD,BY0!D9J?
M#DMF?\8 ,O9&.G&SP7IG]DY*N.L+$^N=B1N6"Y8R U*.S6\"9A_ER>!DIY>+
M#9I$YH$U&-Q:Y++<=Y=4E;=1YZ)NO[8'K=>+L'O:WGH8[8_D;MU?9[VGZ6_7
MOJ7E_EA4WHNJ:Y5W-Q\[I6K9< R_-#-VD.GV^I+)7=T^BN:Y[&^U^I=:G?2-
M77"]-ES\ 5!+ P04 " !C;6Y-YF7OZ1@# 8# &0 'AL+W=O (*)HCGCGZB4N
:)&2=9 N*=LG>;R7Q6DFV5M)P967$
MI(M5/I!H!3IZ0%$8QWXOJ==+ZMF6_UT;^9R_/G&0HM^NE?P?+D5_P!0
M2P,$% @ 8VUN37*R^AJ ! EAL !D !X;"]W;W)KP(2]:N(O8D+?O;]F)'=O>;I:>V
M5S]6+)9J$7VTD0;02P_B]Z ;(K+A;_?@Z!XOW!O.'V^P]A'"F&AR0<3T+
M1$4W7CPD*@A'D#""["+(NPB2F,-4C]$=YMRG&J>:$B=?'\82XN3FC*+%,05F
M37#6Y,W:/F"-(R@804U@3L,(>@1S/8;N*2$6