þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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95-0725980
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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1912 Farmer Brothers Drive, Northlake, Texas 76262
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(Address of Principal Executive Offices; Zip Code)
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888-998-2468
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(Registrant’s Telephone Number, Including Area Code)
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Title of Each Class
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Trading Symbol(s)
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Name of Each Exchange on Which Registered
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Common Stock, $1.00 par value
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FARM
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NASDAQ Global Select Market
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Large accelerated filer
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¨
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Accelerated filer
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þ
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
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Exchange Act.
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¨
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PART I
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ITEM 1.
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Business
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ITEM 1A.
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Risk Factors
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ITEM 1B.
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Unresolved Staff Comments
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ITEM 2.
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Properties
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ITEM 3.
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Legal Proceedings
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ITEM 4.
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Mine Safety Disclosures
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PART II
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ITEM 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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ITEM 6.
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Selected Financial Data
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ITEM 7.
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Management's Discussion and Analysis of Financial Condition and Results of Operations
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ITEM 7A.
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Quantitative and Qualitative Disclosures About Market Risk
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ITEM 8.
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Financial Statements and Supplementary Data
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ITEM 9.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
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ITEM 9A.
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Controls and Procedures
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ITEM 9B.
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Other Information
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PART III
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ITEM 10.
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Directors, Executive Officers and Corporate Governance
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ITEM 11.
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Executive Compensation
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ITEM 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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ITEM 13.
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Certain Relationships and Related Transactions, and Director Independence
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ITEM 14.
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Principal Accountant Fees and Services
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PART IV
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ITEM 15.
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Exhibits, Financial Statement Schedules
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ITEM 16.
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Form 10-K Summary
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SIGNATURES
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INDEX OF CONSOLIDATED FINANCIAL STATEMENTS
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Item 1.
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Business
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•
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a robust line of roast and ground coffee, including organic, Direct Trade, Project D.I.R.E.C.T.® and other sustainably-produced offerings;
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•
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frozen liquid coffee;
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•
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flavored and unflavored iced and hot teas;
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•
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culinary products including gelatins and puddings, soup bases, dressings, gravy and sauce mixes, pancake and biscuit mixes, jellies and preserves, and coffee-related products such as coffee filters, sugar and creamers;
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•
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spices; and
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•
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other beverages including cappuccino, cocoa, granitas, and concentrated and ready-to-drink cold brew and iced coffee.
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•
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develop new products in response to demographic and other trends to better compete in areas such as premium coffees and teas;
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•
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expand production line capacity at the Northlake facility to integrate acquired product volumes and to support top-line growth;
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•
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rethink aspects of our Company culture to improve productivity and employee engagement and to attract and retain talent;
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•
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embrace sustainability across our operations, in the quality of our products, as well as, how we treat our coffee growers; and
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•
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ensure our systems and processes provide high-quality products at a competitive cost, protection against cyber threats, and a safe environment for our employees and partners.
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a wide variety of coffee product offerings and packaging options across numerous brands and three quality tiers-value, premium and specialty;
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consumer-branded coffee and tea products;
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•
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channel-based expertise;
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•
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beverage equipment placement and 24/7 service;
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•
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hassle-free inventory and product procurement management;
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Direct-store-delivery ("DSD") customer service;
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•
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merchandising support;
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•
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product and menu insights; and
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•
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a robust approach to social, environmental and economic sustainability throughout our business.
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•
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Commercial Brewing Equipment Service. From installation, to preventative maintenance, and timely repair execution, our customers count on us to meet their equipment needs. Our trained service technicians provide reliable, consistent service coverage across a wide geographic area giving us a competitive advantage. In fiscal 2019, we repurposed a fully dedicated equipment remanufacturing center in Oklahoma City enabling us to restore used equipment to like-new condition enabling us to better manage equipment costs for us and our customers. In addition, we are investing in systems and processes to enable a more efficient go-to-market in fiscal 2020.
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•
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Customer Fill Rates. Providing our customers the product they want, when they want it, is key to customer satisfaction and retention. We are investing in systems and processes to improve our fill rates, an example being the new branch replenishment tool we are rolling out in fiscal 2020 to assist our field team in ordering the right inventory. We believe our stockkeeping unit ("SKU") optimization project will support higher fill rates, while delivering on-trend products our customers demand.
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•
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Customer Service. We have partnered with a leading contact/call center provider to enable us to manage our equipment service program. In fiscal 2020, we are planning expansion of this partnership to provide support to our DSD route business to enable quick resolution of issues and drive better visibility on customer inquiries. We believe this will enable better customer response and help us to improve customer retention.
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•
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New Facility Investment. In fiscal 2017, we completed construction of and relocation to our state-of-the-art Northlake facility. In fiscal 2018, we began a project to expand our production lines at the Northlake facility. We are focused on leveraging our investment in the Northlake facility to produce the highest quality coffee in response to the market shift to premium and specialty coffee, support the transition of acquired product volumes, and create opportunities for customer acquisition and sustainable long-term growth.
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•
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Safe Quality Food ("SQF") Certification. We are committed to the highest standards in food quality and safety. In fiscal 2018, the Northlake facility received SQF certification, joining our Portland and Houston SQF-certified facilities. SQF is a Global Food Safety Initiative-based system that strengthens our commitment to supply safe quality coffee products and comply with food safety legislation. Required by many of our national account customers, SQF certification at the Northlake facility marks an important step that will allow us the production platform to increase volume for national account customers as needed.
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Acquisition Integration. Through our recent acquisitions we have worked to reduce costs by integrating the acquired businesses into our existing corporate and operational structure. Eliminating redundant functions, merging delivery networks and combining production processing and facilities have resulted in added synergies and efficiencies compared to their pre-acquisition cost structures.
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•
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New Facility. We undertook the relocation of our corporate headquarters, product development lab, and manufacturing and distribution operations from Torrance, California to Northlake, Texas, in part, to pursue improved production efficiency to allow us to provide a more cost-competitive offering of high-quality products. We believe the ongoing improvements in production efficiency will allow us to operate at a lower cost, generally over the long term.
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•
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DSD Restructuring Plan. As a result of an ongoing operational review of various initiatives within our DSD selling organization, we have reorganized our DSD operations in an effort to streamline operations and improve selling effectiveness and financial results. We continue to analyze our sales organization and evaluate other potential restructuring opportunities in light of our strategic priorities.
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•
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Supply Chain. In recent years, we have undertaken efforts to streamline our supply chain, including replacing our long-haul fleet operations with third-party logistics (“3PL“), resulting in a reduction in our fuel consumption and empty trailer miles, while improving our intermodal and trailer cube utilization; using vendor managed inventory arrangements to reconfigure our packaging methodology and reduce waste; and engaging third-party warehouse management services at the Northlake facility to facilitate cost savings by leveraging the third party's expertise in opening new facilities, implementing lean management practices, improving performance on certain key performance metrics, and standardizing best practices.
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•
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Telematics. In an effort to make our DSD fleet more fuel-efficient, we installed telematics monitoring devices in our delivery trucks, allowing us to see contributing factors to our transportation-related carbon footprint. Installation of telematics monitoring devices has resulted in reduced idling time, a cut in rapid acceleration, and a reduction in fuel expenditures.
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•
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Optimize Product Portfolio. Since fiscal 2018, we have undertaken efforts to optimize our SKU count reducing our total SKU count by more than 26.7%. We continue to evaluate the productivity of our product assortment in order to optimize our portfolio.
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Market Opportunities. We believe we are well-positioned to continue to pursue growth through additional, opportunistic M&A activity to deliver aligned brands, customers and innovation. Our recent acquisitions have added to our product portfolio, improved our growth potential, deepened our distribution footprint and increased our capacity utilization at our production facilities.
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•
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Asset Utilization. We continue to look for ways to deploy our personnel, systems, assets and infrastructure to create or enhance stockholder value. Areas of focus have included corporate staffing and structure, methods of procurement, logistics, inventory management, supporting technology, and real estate assets.
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•
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Investment in Technology. We have invested in technology and process improvements to improve our efficiency and the effectiveness of our sales and distribution network. In recent years, we have completed our advanced routing software initiatives for our last mile delivery and we continue to invest in our hand-held sales and inventory management device for our delivery drivers.
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•
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Branch Consolidation and Property Sales. We evaluate our branch operation structure on an ongoing basis to identify opportunities to streamline the supply chain and reduce costs. In an effort to streamline our branch operations, in the last three fiscal years, we have sold branch properties in Texas, Southern California, Washington and other states.
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•
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Investment in Human Resources. Our senior leadership team brings a proven track record of strategic and operational leadership capabilities. We have also added experienced and vibrant talent to our team and continue to benefit from our in-house expertise in sustainability, acquisition and integration, and operations.
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•
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Commitment to Employee Wellness. We are committed to creating a healthier and happier workforce which we believe contributes to our success. We have received certifications as a Fit-Friendly Worksite and a Blue Zone Workplace based on the activities and environment created in our workplace to support healthy living and promote wellness of our associates.
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•
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Employee Development. We have invested in a Learning Management System to enable training facilitation and tracking of training modules to support the development of employees at all levels and functions within the organization. In recent years, we have deployed courses to our Quality, Manufacturing and Maintenance functions and we intend to expand our focus to include critical training modules that impact our entire workforce. We recently completed a Talent Planning Process of all exempt level employees across the organization. We calibrated the assessment of talent and created and began to execute on succession charts for all critical roles to ensure we have the right talent and capabilities to support the business today and in the future.
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•
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Performance Driven Culture. In fiscal 2019, we continued to pursue greater alignment of employee individual goals with Company goals under our compensation plans in order to focus the entire organization on the effort to create value for our stockholders.
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•
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Product Development Lab. The Northlake facility includes a product development lab where we are focused on developing innovative products in response to industry trends and customer needs. Recent new products developed includes Artisan and Metro Single Origin coffees, cold brew coffees, Artisan hot teas and on trend seasonal coffees and cappuccinos.
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•
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Sustainability. We believe that our collective efforts in measuring our social and environmental impact, creating programs for waste, water and energy reduction, promoting partnerships in our supply chain that aim at supply chain stability and food security, and focusing on employee engagement place us in a unique position to help retailers and foodservice operators create differentiated coffee and tea programs that can include sustainable supply chains, direct trade purchasing, training and technical assistance, recycling and composting networks, and packaging material reductions. During fiscal 2019, we made the Carbon Disclosure Project's Climate leadership level for our efforts to reduce Scope 1, 2 and 3 emissions (direct emissions, indirect emissions from consumption of purchased electricity, heat or steam and other indirect emissions). Further, in fiscal 2019, we published our annual sustainability report based on the Global Reporting Initiative’s comprehensive compliance standard. In addition, China Mist is a member of the Ethical Tea Partnership (the “ETP”), a non-profit organization that works to improve the sustainability of the tea sector, the lives of tea workers and farmers, and the environment in which tea is produced. As a member of the ETP, China Mist sources all of its tea from tea plantations that are certified, monitored, and regularly audited by the ETP.
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•
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Science-Based Carbon Reduction Targets. We believe combating climate change is critical to the future of our company, the coffee industry, coffee growers and the world. In fiscal 2019 we re-set our science based carbon reduction targets to include the acquisitions of Boyd Coffee, China Mist, and West Coast Coffee. With this new baseline, we established more ambitious goals in line with efforts to limit global warming to 1.5°C. Setting approved targets places us among those responsible businesses that are making measurable contributions to incorporate sustainability within their business strategy.
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•
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Zero Waste to Landfill. Achieving zero waste in our production and distribution facilities is a significant step in reaching our overall sustainability goals. In fiscal 2019 we maintained our goal of 90% waste diversion for our primary production and distribution facilities. To accomplish this goal, we implemented ambitious recycling and composting guidelines across these facilities. The enhanced efforts resulted in an approximate 80% reduction from previous years, meeting the Zero Waste International Alliance requirements for diverting waste sent to landfills in these locations.
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•
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LEED® Certified Facilities. Our Portland production and distribution facility was one of the first in the Northwest to achieve LEED® Silver Certification. Our corporate offices in Northlake, Texas achieved LEED® Silver Certification.
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•
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Expansion of Project D.I.R.E.C.T.® Program. In fiscal 2019, we continued to grow our direct trade sourcing model, Project D.I.R.E.C.T. ®. Project D.I.R.E.C.T . ® is an impact-based product or raw material sourcing framework that utilizes data-based sustainability metrics to influence an inclusive, collaborative approach to sustainability along the supply chain. To evaluate whether coffee is Project D.I.R.E.C.T . ® , we follow an outcome-based evaluation framework. The result of this evaluation impacts where we invest our resources within our supply chain and has led to an increased level of transparency for us. Project D.I.R.E.C.T . ® represents a growing part of our coffee portfolio.
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•
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Green Coffee Traceability. We are committed to the inclusion of more sustainably-sourced coffees in our supply chain. Regulatory and reputational risks can increase when customers, roasters and suppliers cannot see back into their supply chain. To address these concerns, as well as to deepen our commitment to the longevity of the coffee industry, we track traceability levels from all green coffee suppliers on a per-contract basis. During fiscal 2019, we established a system for coffee suppliers to provide information on a per contract basis. This helps us to bring
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•
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Supplier Sustainability. We are committed to working with suppliers who share our social, environmental and economic sustainability goals. Regulatory and reputational risks can increase when suppliers are not held to the same strict standards to which we hold ourselves. To address this concern, we annually survey all green coffee suppliers along with our top suppliers of processed coffee and non-coffee products to assess their social, environmental, and economic sustainability practices and alignment with the United Nations Global Compact, a United Nations initiative to encourage businesses worldwide to adopt sustainable and socially responsible policies, documenting 96% compliance with United Nations Global Compact practices from all respondents. In fiscal 2019 we adopted new Supplier Standards of Engagement. These Standards of Engagement set minimum standards for Suppliers that are designed to provide Farmer Bros. visibility into all aspects of its supply chain and meets these objectives. These Standards of Engagement also serve as Supplier’s Certificate of Compliance, executed by the undersigned Supplier, representing Supplier's receipt and acknowledgment of the Standards of Engagement and agreement to comply with the same.
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•
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Recipient organizations include Feeding America, Ronald McDonald House, and local food banks.
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•
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We support industry organizations such as World Coffee Research, which commits to grow, protect, and enhance supplies of quality coffee while improving the livelihoods of the families who produce it, and the Specialty Coffee Association (“SCA”) Sustainability Council and the Coalition for Coffee Communities, which are focused on sustainability in coffee growing regions.
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•
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Our employee-driven CAFÉ Crew organizes employee involvement at local charities and fund raisers, including support of Team Ronald McDonald House, riding in the Ride Against Hunger supported by Tarrant Area Food Bank, hosting local food drives and donation of Farmer Brothers products nearing the end of their shelf life to organizations related to Feeding America.
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•
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All of our usable and near expiring products or products with damaged packaging that can be donated are donated to Feeding America affiliated food banks nationwide, in an effort to keep all edible food waste from going to landfills.
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•
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Coffee Industry Leadership. Through our dedication to the craft of sourcing, blending and roasting coffee, and our participation and/or leadership positions with the SCA, National Coffee Association, Coalition for Coffee Communities, International Women's Coffee Alliance, Pacific Coast Coffee Association, Roasters Guild and World Coffee Research, we work to help shape the future of the coffee industry. We believe that due to our commitment to the industry, large retail and foodservice operators are drawn to working with us. We were among the first coffee roasters in the nation to receive SCA certification of a state-of-the-art coffee lab and operate Public Domain®, a specialty coffeehouse in Portland, Oregon. We also received SCA certification for our product development lab at the Northlake facility.
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•
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Market Insight and Consumer Research. We have developed a market insight capability internally that reinforces our business-to-business positioning as a thought leader in the coffee and tea industries. We provide trend insights
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Item 1A.
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Risk Factors
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•
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requiring a substantial portion of our cash flow from operations to make payments on our indebtedness;
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•
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reducing the cash flow available or limiting our ability to borrow additional funds, to pay dividends, to fund capital expenditures and other corporate purposes and to pursue our business strategies;
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•
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limiting our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate;
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•
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increasing our vulnerability to general adverse economic and industry conditions; and
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•
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placing us at a competitive disadvantage compared to our competitors that have less debt.
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•
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seek additional financing in the debt or equity markets;
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•
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refinance or restructure all or a portion of our indebtedness;
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•
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sell assets; and/or
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•
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reduce or delay planned capital or operating expenditures, strategic acquisitions or investments.
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Item 1.B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Location
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Approximate Area
(Square Feet)
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Purpose
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Status
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Northlake, TX
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535,585
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Corporate headquarters, manufacturing, distribution, warehouse, product development lab
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Owned
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Houston, TX
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330,877
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Manufacturing and warehouse
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Owned
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Portland, OR
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114,000
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Manufacturing and distribution
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Leased
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Northlake, IL
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89,837
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Distribution and warehouse
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Leased
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Moonachie, NJ
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41,404
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Distribution and warehouse
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Leased
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Hillsboro, OR
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20,400
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Manufacturing, distribution and warehouse
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Leased
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Scottsdale, AZ
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17,400
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Distribution and warehouse
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Leased
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
|
|
2014
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|
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2015
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2016
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2017
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2018
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2019
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||||||
Farmer Bros. Co.
|
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$
|
100.00
|
|
|
$
|
108.75
|
|
|
$
|
148.36
|
|
|
$
|
139.98
|
|
|
$
|
141.37
|
|
|
$
|
75.75
|
|
Russell 2000 Index
|
|
$
|
100.00
|
|
|
$
|
106.80
|
|
|
$
|
100.21
|
|
|
$
|
127.11
|
|
|
$
|
149.36
|
|
|
$
|
144.42
|
|
Value Line Food Processing Index
|
|
$
|
100.00
|
|
|
$
|
106.92
|
|
|
$
|
126.68
|
|
|
$
|
135.00
|
|
|
$
|
134.16
|
|
|
$
|
144.79
|
|
Peer Group Index
|
|
$
|
100.00
|
|
|
$
|
104.70
|
|
|
$
|
158.44
|
|
|
$
|
151.90
|
|
|
$
|
143.89
|
|
|
$
|
110.69
|
|
Period
|
|
Total Number of Shares of Our Class A Common Stock Purchased
|
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Average Price Paid Per Share of Our Class A Common Stock
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Total Number of Shares of Our Class A Common Stock Purchased as Part of Publicly Announced Plans or Programs
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Maximum Number of Shares of Our Class A Common Stock That May Yet Be Purchased Under the Plan or Program
|
|||||
April 1 to April 30, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
May 1 to May 31, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
June 1 to June 30, 2019
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
Item 6.
|
Selected Financial Data
|
|
For the Years Ended June 30,
|
||||||||||||||||||
(In thousands, except per share data)
|
2019
|
|
2018(1)
|
|
2017(1)
|
|
2016(1)
|
|
2015(1)
|
||||||||||
Consolidated Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
595,942
|
|
|
$
|
606,544
|
|
|
$
|
541,500
|
|
|
$
|
544,382
|
|
|
$
|
545,882
|
|
Cost of goods sold
|
$
|
416,840
|
|
|
$
|
399,155
|
|
|
$
|
354,649
|
|
|
$
|
373,165
|
|
|
$
|
386,400
|
|
Restructuring and other transition expenses
|
$
|
4,733
|
|
|
$
|
662
|
|
|
$
|
11,016
|
|
|
$
|
16,533
|
|
|
$
|
10,432
|
|
Net gain from sale of Torrance Facility
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(37,449
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Net gains from sale of Spice Assets
|
$
|
(593
|
)
|
|
$
|
(770
|
)
|
|
$
|
(919
|
)
|
|
$
|
(5,603
|
)
|
|
$
|
—
|
|
Net (gains) losses from sales of other assets
|
$
|
1,058
|
|
|
$
|
(196
|
)
|
|
$
|
(1,210
|
)
|
|
$
|
(2,802
|
)
|
|
$
|
394
|
|
Impairment losses on intangible assets
|
$
|
—
|
|
|
$
|
3,820
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(Loss) income from operations
|
$
|
(14,702
|
)
|
|
$
|
1,053
|
|
|
$
|
38,934
|
|
|
$
|
(1,736
|
)
|
|
$
|
(8,424
|
)
|
Pension settlement charge
|
$
|
(10,948
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Income tax expense (benefit)(2)
|
$
|
40,111
|
|
|
$
|
17,312
|
|
|
$
|
14,815
|
|
|
$
|
(72,239
|
)
|
|
$
|
402
|
|
Net (loss) income available to common stockholders
|
$
|
(74,130
|
)
|
|
$
|
(18,669
|
)
|
|
$
|
22,551
|
|
|
$
|
71,791
|
|
|
$
|
(9,708
|
)
|
Net (loss) income available to common stockholders per common share—basic
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.35
|
|
|
$
|
4.35
|
|
|
$
|
(0.60
|
)
|
Net (loss) income available to common stockholders per common share—diluted
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.34
|
|
|
$
|
4.32
|
|
|
$
|
(0.60
|
)
|
Cash dividends declared per common share
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
As of June 30,
|
||||||||||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||
Consolidated Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Total current assets
|
$
|
159,908
|
|
|
$
|
173,514
|
|
|
$
|
140,703
|
|
|
$
|
177,366
|
|
|
$
|
166,140
|
|
Property, plant and equipment, net
|
$
|
189,458
|
|
|
$
|
186,589
|
|
|
$
|
176,066
|
|
|
$
|
118,416
|
|
|
$
|
90,201
|
|
Goodwill
|
$
|
36,224
|
|
|
$
|
36,224
|
|
|
$
|
10,996
|
|
|
$
|
272
|
|
|
$
|
272
|
|
Intangible assets, net
|
$
|
28,878
|
|
|
$
|
31,515
|
|
|
$
|
18,618
|
|
|
$
|
6,219
|
|
|
$
|
6,419
|
|
Deferred income taxes
|
$
|
—
|
|
|
$
|
39,308
|
|
|
$
|
53,933
|
|
|
$
|
71,508
|
|
|
$
|
11,770
|
|
Total assets
|
$
|
424,610
|
|
|
$
|
475,531
|
|
|
$
|
407,153
|
|
|
$
|
383,714
|
|
|
$
|
282,417
|
|
Short-term borrowings under revolving credit facility
|
$
|
—
|
|
|
$
|
89,787
|
|
|
$
|
27,621
|
|
|
$
|
109
|
|
|
$
|
78
|
|
Long-term borrowings under revolving credit facility(3)
|
$
|
92,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Capital lease obligations
|
$
|
34
|
|
|
$
|
248
|
|
|
$
|
1,195
|
|
|
$
|
2,359
|
|
|
$
|
5,848
|
|
Earnout payable
|
$
|
400
|
|
|
$
|
600
|
|
|
$
|
1,100
|
|
|
$
|
100
|
|
|
$
|
200
|
|
Long-term derivative liabilities
|
$
|
1,612
|
|
|
$
|
386
|
|
|
$
|
380
|
|
|
$
|
—
|
|
|
$
|
25
|
|
Total liabilities
|
$
|
267,116
|
|
|
$
|
246,476
|
|
|
$
|
177,601
|
|
|
$
|
186,397
|
|
|
$
|
161,951
|
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
For The Years Ended June 30,
|
|
2019 vs 2018
|
|
2018 vs 2017
|
|||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
Favorable (Unfavorable)
|
|
Favorable (Unfavorable)
|
|||||||||||||||||
|
|
|
|
|
|
|
Change
|
|
% Change
|
|
Change
|
|
% Change
|
|||||||||||||
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net sales
|
$
|
595,942
|
|
|
$
|
606,544
|
|
|
$
|
541,500
|
|
|
$
|
(10,602
|
)
|
|
(1.7
|
)%
|
|
$
|
65,044
|
|
|
12.0
|
%
|
|
Gross margin
|
30.1
|
%
|
|
34.2
|
%
|
|
34.5
|
%
|
|
(4.1
|
)%
|
|
NM
|
|
|
(0.3
|
)%
|
|
NM
|
|
||||||
Operating expenses as a % of sales
|
32.5
|
%
|
|
34.0
|
%
|
|
27.3
|
%
|
|
(1.5
|
)%
|
|
NM
|
|
|
6.7
|
%
|
|
NM
|
|
||||||
(Loss) income from operations
|
$
|
(14,702
|
)
|
|
$
|
1,053
|
|
|
$
|
38,934
|
|
|
$
|
(15,755
|
)
|
|
(1,496.2
|
)%
|
|
$
|
(37,881
|
)
|
|
NM
|
|
|
Net (loss) income
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
|
$
|
(55,315
|
)
|
|
(302.6
|
)%
|
|
$
|
(40,831
|
)
|
|
NM
|
|
|
Net (loss) income available to common stockholders per common share—basic
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.35
|
|
|
$
|
(3.25
|
)
|
|
NM
|
|
|
$
|
(2.46
|
)
|
|
NM
|
|
|
Net (loss) income available to common stockholders per common share—diluted
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.34
|
|
|
$
|
(3.25
|
)
|
|
NM
|
|
|
$
|
(2.45
|
)
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Coffee pounds
|
108,098
|
|
|
107,429
|
|
107,429
|
|
95,499
|
|
|
669
|
|
|
0.6
|
%
|
|
11,930
|
|
|
12.5
|
%
|
|||||
EBITDA(1)
|
$
|
3,617
|
|
|
$
|
32,673
|
|
|
$
|
62,521
|
|
|
$
|
(29,056
|
)
|
|
(88.9
|
)%
|
|
(29,848
|
)
|
|
(47.7
|
)%
|
||
EBITDA Margin(1)
|
0.6
|
%
|
|
5.4
|
%
|
|
11.5
|
%
|
|
(4.8
|
)%
|
|
NM
|
|
|
(6.1
|
)%
|
|
NM
|
|
||||||
Adjusted EBITDA(1)
|
$
|
31,882
|
|
|
$
|
47,562
|
|
|
$
|
42,985
|
|
|
$
|
(15,680
|
)
|
|
(33.0
|
)%
|
|
$
|
4,577
|
|
|
10.6
|
%
|
|
Adjusted EBITDA Margin(1)
|
5.3
|
%
|
|
7.8
|
%
|
|
7.9
|
%
|
|
(2.5
|
)%
|
|
NM
|
|
|
(0.1
|
)%
|
|
NM
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Percentage of Total Net Sales By Product Category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Coffee (Roasted)
|
63.5
|
%
|
|
62.6
|
%
|
|
62.7
|
%
|
|
0.9
|
%
|
|
1.4
|
%
|
|
(0.1
|
)%
|
|
(0.2
|
)%
|
||||||
Coffee (Frozen Liquid)
|
5.8
|
%
|
|
5.7
|
%
|
|
6.1
|
%
|
|
0.1
|
%
|
|
1.8
|
%
|
|
(0.4
|
)%
|
|
(6.6
|
)%
|
||||||
Tea (Iced & Hot)
|
5.6
|
%
|
|
5.4
|
%
|
|
5.4
|
%
|
|
0.2
|
%
|
|
3.7
|
%
|
|
—
|
%
|
|
—
|
%
|
||||||
Culinary
|
10.8
|
%
|
|
10.6
|
%
|
|
10.3
|
%
|
|
0.2
|
%
|
|
1.9
|
%
|
|
0.3
|
%
|
|
2.9
|
%
|
||||||
Spice
|
4.0
|
%
|
|
4.2
|
%
|
|
4.6
|
%
|
|
(0.2
|
)%
|
|
(4.8
|
)%
|
|
(0.4
|
)%
|
|
(8.7
|
)%
|
||||||
Other beverages(2)
|
9.8
|
%
|
|
11.0
|
%
|
|
10.4
|
%
|
|
(1.2
|
)%
|
|
(10.9
|
)%
|
|
0.6
|
%
|
|
5.8
|
%
|
||||||
Net sales by product category
|
99.5
|
%
|
|
99.5
|
%
|
|
99.5
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
(6.8
|
)%
|
||||||
Fuel Surcharge
|
0.5
|
%
|
|
0.5
|
%
|
|
0.5
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
||||||
Total
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Capital expenditures related to maintenance
|
$
|
21,088
|
|
|
$
|
21,782
|
|
|
$
|
19,246
|
|
|
$
|
(694
|
)
|
|
(3.2
|
)%
|
|
$
|
2,536
|
|
|
13.2
|
%
|
|
Total capital expenditures
|
$
|
34,759
|
|
|
$
|
37,020
|
|
|
$
|
84,949
|
|
|
$
|
(2,261
|
)
|
|
(6.1
|
)%
|
|
$
|
(47,929
|
)
|
|
(56.4
|
)%
|
|
Depreciation and amortization expense
|
$
|
31,065
|
|
|
$
|
30,464
|
|
|
$
|
22,970
|
|
|
$
|
601
|
|
|
2.0
|
%
|
|
$
|
7,494
|
|
|
32.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
Investment in State-of-the-Art Facility and Capacity Expansion. We are focused on leveraging our investment in the Northlake, Texas, facility to produce the highest quality coffee in response to the market shift to premium and specialty coffee, support the transition of acquired product volumes, and create opportunities for customer acquisition and sustainable long-term growth. However, until we complete the transition of most manufacturing to our Northlake facility, we will continue to experience higher manufacturing costs driven by downtime associated with certain aging production infrastructure.
|
•
|
Supply Chain Efficiencies and Competition. In order to compete effectively and capitalize on growth opportunities, we must retain and continue to grow our customer base, evaluate and undertake initiatives to reduce costs and streamline our supply chain. We continue to look for ways to deploy our personnel, systems, assets and infrastructure to create or enhance stockholder value. Areas of focus have included corporate staffing and structure, methods of procurement, logistics, inventory management, supporting technology, and real estate assets.
|
•
|
Demographic and Channel Trends. Our success is dependent upon our ability to develop new products in response to demographic and other trends to better compete in areas such as premium coffee and tea, including expansion of our product portfolio by investing resources in what we believe to be key growth categories and different formats.
|
•
|
Fluctuations in Green Coffee Prices. Our primary raw material is green coffee, an exchange-traded agricultural commodity that is subject to price fluctuations. Over the past five years, coffee “C” market near month price per pound ranged from approximately $0.96 to $1.90. The coffee “C” market near month price as of June 30, 2019 and
|
•
|
Coffee Brewing Equipment and Service. We offer our customers a comprehensive equipment program and 24/7 nationwide equipment service which we believe differentiates us in the marketplace. We offer a full spectrum of equipment needs, which includes brewing equipment installation, water filtration systems, equipment training, and maintenance services to ensure we are able to meet our customer’s demands.
|
•
|
Hedging Strategy. We are exposed to market risk of losses due to changes in coffee commodity prices. Our business model strives to reduce the impact of green coffee price fluctuations on our financial results and to protect and stabilize our margins, principally through customer arrangements and derivative instruments, as further explained in Note 6, Derivative Instruments, of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10‑K.
|
•
|
Sustainability. With an increasing focus on sustainability across the coffee and foodservice industry, and particularly from the customers we serve, it is important for us to embrace sustainability across our operations, in the quality of our products, as well as, how we treat our coffee growers. We believe that our collective efforts in measuring our social and environmental impact, creating programs for waste, water and energy reduction, promoting partnerships in our supply chain that aim at supply chain stability and food security, and focusing on employee engagement place us in a unique position to help retailers and foodservice operators create differentiated coffee and tea programs that can include sustainable supply chains, direct trade purchasing, training and technical assistance, recycling and composting networks, and packaging material reductions.
|
|
For the Years Ended June 30,
|
|
2019 vs 2018
|
|
2018 vs 2017
|
||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
Favorable (Unfavorable)
|
|
Favorable (Unfavorable)
|
||||||||||||||||
|
|
|
|
|
|
|
Change
|
|
% Change
|
|
Change
|
|
% Change
|
||||||||||||
Net sales
|
$
|
595,942
|
|
|
$
|
606,544
|
|
|
$
|
541,500
|
|
|
$
|
(10,602
|
)
|
|
(1.7
|
)%
|
|
$
|
65,044
|
|
|
12.0
|
%
|
Cost of goods sold
|
416,840
|
|
|
399,155
|
|
|
354,649
|
|
|
(17,685
|
)
|
|
(4.4
|
)%
|
|
(44,506
|
)
|
|
(12.5
|
)%
|
|||||
Gross profit
|
179,102
|
|
|
207,389
|
|
|
186,851
|
|
|
(28,287
|
)
|
|
(13.6
|
)%
|
|
20,538
|
|
|
11.0
|
%
|
|||||
Selling expenses
|
139,647
|
|
|
153,391
|
|
|
133,534
|
|
|
13,744
|
|
|
9.0
|
%
|
|
(19,857
|
)
|
|
(14.9
|
)%
|
|||||
General and administrative expenses
|
48,959
|
|
|
49,429
|
|
|
42,945
|
|
|
470
|
|
|
1.0
|
%
|
|
(6,484
|
)
|
|
(15.1
|
)%
|
|||||
Restructuring and other transition expenses
|
4,733
|
|
|
662
|
|
|
11,016
|
|
|
(4,071
|
)
|
|
(615.0
|
)%
|
|
10,354
|
|
|
94.0
|
%
|
|||||
Net gain from sale of Torrance Facility
|
—
|
|
|
—
|
|
|
(37,449
|
)
|
|
—
|
|
|
NM
|
|
|
(37,449
|
)
|
|
100.0
|
%
|
|||||
Net gains from sale of Spice Assets
|
(593
|
)
|
|
(770
|
)
|
|
(919
|
)
|
|
(177
|
)
|
|
23.0
|
%
|
|
(149
|
)
|
|
16.2
|
%
|
|||||
Net losses (gains) from sales of other assets
|
1,058
|
|
|
(196
|
)
|
|
(1,210
|
)
|
|
(1,254
|
)
|
|
639.8
|
%
|
|
(1,014
|
)
|
|
83.8
|
%
|
|||||
Impairment losses on intangible assets
|
—
|
|
|
3,820
|
|
|
—
|
|
|
3,820
|
|
|
100.0
|
%
|
|
(3,820
|
)
|
|
NM
|
|
|||||
Operating expenses
|
193,804
|
|
|
206,336
|
|
|
147,917
|
|
|
12,532
|
|
|
6.1
|
%
|
|
(58,419
|
)
|
|
(39.5
|
)%
|
|||||
(Loss) income from operations
|
(14,702
|
)
|
|
1,053
|
|
|
38,934
|
|
|
(15,755
|
)
|
|
(1,496.2
|
)%
|
|
(37,881
|
)
|
|
(97.3
|
)%
|
|||||
Other (expense) income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Dividend income
|
—
|
|
|
12
|
|
|
1,007
|
|
|
(12
|
)
|
|
(100.0
|
)%
|
|
(995
|
)
|
|
(98.8
|
)%
|
|||||
Interest income
|
—
|
|
|
2
|
|
|
567
|
|
|
(2
|
)
|
|
(100.0
|
)%
|
|
(565
|
)
|
|
(99.6
|
)%
|
|||||
Interest expense
|
(12,000
|
)
|
|
(9,757
|
)
|
|
(8,601
|
)
|
|
(2,243
|
)
|
|
23.0
|
%
|
|
(1,156
|
)
|
|
13.4
|
%
|
|||||
Pension settlement charge
|
(10,948
|
)
|
|
—
|
|
|
—
|
|
|
(10,948
|
)
|
|
NM
|
|
|
—
|
|
|
NM
|
|
|||||
Other, net
|
4,166
|
|
|
7,722
|
|
|
5,459
|
|
|
(3,556
|
)
|
|
(46.1
|
)%
|
|
2,263
|
|
|
41.5
|
%
|
|||||
Total other (expense) income
|
(18,782
|
)
|
|
(2,021
|
)
|
|
(1,568
|
)
|
|
(16,761
|
)
|
|
829.3
|
%
|
|
(453
|
)
|
|
28.9
|
%
|
|||||
(Loss) income before taxes
|
(33,484
|
)
|
|
(968
|
)
|
|
37,366
|
|
|
(32,516
|
)
|
|
3,359.1
|
%
|
|
(38,334
|
)
|
|
(102.6
|
)%
|
|||||
Income tax expense
|
40,111
|
|
|
17,312
|
|
|
14,815
|
|
|
22,799
|
|
|
131.7
|
%
|
|
2,497
|
|
|
16.9
|
%
|
|||||
Net (loss) income
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
|
$
|
(55,315
|
)
|
|
302.6
|
%
|
|
$
|
(40,831
|
)
|
|
(181.1
|
)%
|
Less: Cumulative preferred dividends, undeclared and unpaid
|
535
|
|
|
389
|
|
|
—
|
|
|
146
|
|
|
37.5
|
%
|
|
389
|
|
|
NM
|
|
|||||
Net (loss) income available to common stockholders
|
$
|
(74,130
|
)
|
|
$
|
(18,669
|
)
|
|
$
|
22,551
|
|
|
$
|
(55,461
|
)
|
|
297.1
|
%
|
|
$
|
(41,220
|
)
|
|
(182.8
|
)%
|
|
For the Years Ended June 30,
|
|
2019 vs 2018
|
|
2018 vs 2017
|
||||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
Favorable (Unfavorable)
|
|
Favorable (Unfavorable)
|
||||||||||||||||
|
|
|
|
|
|
|
Change
|
|
% Change
|
|
Change
|
|
% Change
|
||||||||||||
Units sold
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Coffee (Roasted)
|
86,478
|
|
|
85,943
|
|
|
76,399
|
|
|
535
|
|
|
0.62
|
%
|
|
9,544
|
|
|
12.49
|
%
|
|||||
Coffee (Frozen Liquid)
|
427
|
|
|
407
|
|
|
403
|
|
|
20,000
|
|
|
4.91
|
%
|
|
4
|
|
|
0.99
|
%
|
|||||
Tea (Iced & Hot)
|
2,755
|
|
|
2,706
|
|
|
2,482
|
|
|
49
|
|
|
1.81
|
%
|
|
224
|
|
|
9.02
|
%
|
|||||
Culinary
|
7,932
|
|
|
9,227
|
|
|
9,071
|
|
|
(1,295
|
)
|
|
(14.03
|
)%
|
|
156
|
|
|
1.72
|
%
|
|||||
Spice
|
792
|
|
|
933
|
|
|
1,101
|
|
|
(141
|
)
|
|
(15.11
|
)%
|
|
(168
|
)
|
|
(15.26
|
)%
|
|||||
Other beverages(1)
|
4,631
|
|
|
5,932
|
|
|
3,986
|
|
|
(1,301
|
)
|
|
(21.93
|
)%
|
|
1,946
|
|
|
48.82
|
%
|
|||||
Total
|
103,015
|
|
|
105,148
|
|
|
93,442
|
|
|
(2,133
|
)
|
|
(2.03
|
)%
|
|
11,706
|
|
|
12.53
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Unit Price
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Coffee (Roasted)
|
$
|
4.38
|
|
|
$
|
4.42
|
|
|
$
|
4.44
|
|
|
$
|
(0.04
|
)
|
|
(0.90
|
)%
|
|
$
|
(0.02
|
)
|
|
(0.45
|
)%
|
Coffee (Frozen Liquid)
|
$
|
80.89
|
|
|
$
|
85.49
|
|
|
$
|
81.46
|
|
|
$
|
(4.60
|
)
|
|
(5.38
|
)%
|
|
$
|
4.03
|
|
|
4.95
|
%
|
Tea (Iced & Hot)
|
$
|
12.02
|
|
|
$
|
12.00
|
|
|
$
|
11.79
|
|
|
$
|
0.02
|
|
|
0.17
|
%
|
|
$
|
0.21
|
|
|
1.78
|
%
|
Culinary
|
$
|
8.08
|
|
|
$
|
6.98
|
|
|
$
|
6.13
|
|
|
$
|
1.10
|
|
|
15.76
|
%
|
|
$
|
0.85
|
|
|
13.87
|
%
|
Spice
|
$
|
30.43
|
|
|
$
|
26.96
|
|
|
$
|
22.61
|
|
|
$
|
3.47
|
|
|
12.87
|
%
|
|
$
|
4.35
|
|
|
19.24
|
%
|
Other beverages(1)
|
$
|
12.60
|
|
|
$
|
11.24
|
|
|
$
|
14.21
|
|
|
$
|
1.36
|
|
|
12.10
|
%
|
|
$
|
(2.97
|
)
|
|
(20.90
|
)%
|
Average unit price
|
$
|
5.79
|
|
|
$
|
5.77
|
|
|
$
|
5.80
|
|
|
$
|
0.02
|
|
|
0.35
|
%
|
|
$
|
(0.03
|
)
|
|
(0.52
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total Net Sales By Product Category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Coffee (Roasted)
|
$
|
378,583
|
|
|
$
|
379,951
|
|
|
$
|
339,358
|
|
|
$
|
(1,368
|
)
|
|
(0.36
|
)%
|
|
$
|
40,593
|
|
|
11.96
|
%
|
Coffee (Frozen Liquid)
|
34,541
|
|
|
34,794
|
|
|
32,827
|
|
|
(253
|
)
|
|
(0.73
|
)%
|
|
1,967
|
|
|
5.99
|
%
|
|||||
Tea (Iced & Hot)
|
33,109
|
|
|
32,477
|
|
|
29,256
|
|
|
632
|
|
|
1.95
|
%
|
|
3,221
|
|
|
11.01
|
%
|
|||||
Culinary
|
64,100
|
|
|
64,432
|
|
|
55,592
|
|
|
(332
|
)
|
|
(0.52
|
)%
|
|
8,840
|
|
|
15.90
|
%
|
|||||
Spice
|
24,101
|
|
|
25,150
|
|
|
24,895
|
|
|
(1,049
|
)
|
|
(4.17
|
)%
|
|
255
|
|
|
1.02
|
%
|
|||||
Other beverages(1)
|
58,367
|
|
|
66,699
|
|
|
56,653
|
|
|
(8,332
|
)
|
|
(12.49
|
)%
|
|
10,046
|
|
|
17.73
|
%
|
|||||
Net sales by product category
|
$
|
592,801
|
|
|
$
|
603,503
|
|
|
$
|
538,581
|
|
|
$
|
(10,702
|
)
|
|
(1.77
|
)%
|
|
$
|
64,922
|
|
|
12.05
|
%
|
Fuel Surcharge
|
3,141
|
|
|
3,041
|
|
|
2,919
|
|
|
100
|
|
|
3.29
|
%
|
|
122
|
|
|
4.18
|
%
|
|||||
Total
|
$
|
595,942
|
|
|
$
|
606,544
|
|
|
$
|
541,500
|
|
|
$
|
(10,602
|
)
|
|
(1.75
|
)%
|
|
$
|
65,044
|
|
|
12.01
|
%
|
|
For Year Ended June 30,
2019 vs. 2018
|
|
% of Total Mix Change
|
|||
Effect of change in unit sales
|
$
|
(12.4
|
)
|
|
(117.0
|
)%
|
Effect of pricing and product mix changes
|
1.8
|
|
|
17.0
|
%
|
|
Total decrease in net sales
|
$
|
(10.6
|
)
|
|
(100.0
|
)%
|
(In millions)
|
Year Ended June 30,
2018 vs. 2017
|
|
% of Total Mix Change
|
|||
Effect of change in unit sales
|
$
|
67.5
|
|
|
103.8
|
%
|
Effect of pricing and product mix changes
|
(2.5
|
)
|
|
(3.8
|
)%
|
|
Total increase in net sales
|
$
|
65.0
|
|
|
100.0
|
%
|
•
|
income taxes;
|
•
|
interest expense; and
|
•
|
depreciation and amortization expense.
|
•
|
income taxes;
|
•
|
interest expense;
|
•
|
(loss) income from short-term investments;
|
•
|
depreciation and amortization expense;
|
•
|
ESOP and share-based compensation expense;
|
•
|
non-cash impairment losses;
|
•
|
non-cash pension withdrawal expense;
|
•
|
restructuring and other transition expenses;
|
•
|
Severance costs
|
•
|
net gains and losses from sales of assets;
|
•
|
non-cash pension settlement charges; and
|
•
|
acquisition and integration costs.
|
|
|
For the Year Ended June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net (loss) income, as reported
|
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
Income tax expense
|
|
40,111
|
|
|
17,312
|
|
|
14,815
|
|
|||
Interest expense(1)
|
|
6,036
|
|
|
3,177
|
|
|
2,185
|
|
|||
Depreciation and amortization expense
|
|
31,065
|
|
|
30,464
|
|
|
22,970
|
|
|||
EBITDA
|
|
$
|
3,617
|
|
|
$
|
32,673
|
|
|
$
|
62,521
|
|
EBITDA Margin
|
|
0.6
|
%
|
|
5.4
|
%
|
|
11.5
|
%
|
(1)
|
Excludes $6.1 million, $6.6 million and $6.4 million in the fiscal years ended June 30, 2019, 2018 and 2017, respectively, resulting from the adoption of ASU 2017-07.
|
|
|
Year Ended June 30,
|
|||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
|||||||
Net (loss) income, as reported
|
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
|
Income tax expense
|
|
40,111
|
|
|
17,312
|
|
|
14,815
|
|
||||
Interest expense(1)
|
|
6,036
|
|
|
3,177
|
|
|
2,185
|
|
||||
Income from short-term investments
|
|
—
|
|
|
(19
|
)
|
|
(1,853
|
)
|
||||
Depreciation and amortization expense
|
|
31,065
|
|
|
30,464
|
|
|
22,970
|
|
||||
ESOP and share-based compensation expense
|
|
3,723
|
|
|
3,822
|
|
|
3,959
|
|
||||
Restructuring and other transition expenses(2)
|
|
4,733
|
|
|
662
|
|
|
11,016
|
|
||||
Net gain from sale of Torrance Facility
|
|
—
|
|
|
—
|
|
|
(37,449
|
)
|
||||
Net gains from sale of Spice Assets
|
|
(593
|
)
|
|
(770
|
)
|
|
(919
|
)
|
||||
Net losses (gains) from sales of other assets
|
|
1,058
|
|
|
(196
|
)
|
|
(1,210
|
)
|
||||
Impairment losses on intangible assets
|
|
—
|
|
|
3,820
|
|
|
—
|
|
||||
Pension settlement charge
|
|
10,948
|
|
|
—
|
|
|
—
|
|
||||
Non-recurring 2016 proxy contest-related expenses
|
|
—
|
|
|
—
|
|
|
5,186
|
|
||||
Acquisition and integration costs
|
|
6,123
|
|
|
7,570
|
|
|
1,734
|
|
||||
Severance
|
2,273,000
|
|
2,273
|
|
|
—
|
|
|
—
|
|
|||
Adjusted EBITDA
|
|
$
|
31,882
|
|
|
$
|
47,562
|
|
|
$
|
42,985
|
|
|
Adjusted EBITDA Margin
|
|
5.3
|
%
|
|
7.8
|
%
|
|
7.9
|
%
|
(1)
|
Excludes $6.1 million, $6.6 million and $6.4 million in the fiscal years ended June 30, 2019, 2018 and 2017, respectively, resulting from the adoption of ASU 2017-07.
|
(2)
|
Fiscal year ended June 30, 2019, includes $3.4 million, including interest, assessed by the WC Pension Trust representing the Company’s share of the WCTPP unfunded benefits due to the Company’s partial withdrawal from the WCTPP as a result of employment actions taken by the Company in 2016 in connection with the Corporate Relocation Plan, net of payments of $0.8 million.
|
|
For the Years Ended June 30,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Condensed Consolidated Statements of cash flows data (in thousands)
|
|
|
|
|
|
||||||
Net cash provided by operating activities
|
$
|
35,450
|
|
|
$
|
8,855
|
|
|
$
|
42,112
|
|
Net cash used in investing activities
|
(32,361
|
)
|
|
(74,640
|
)
|
|
(106,724
|
)
|
|||
Net cash provided by financing activities
|
1,456
|
|
|
61,982
|
|
|
49,758
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
4,545
|
|
|
$
|
(3,803
|
)
|
|
$
|
(14,854
|
)
|
|
|
Payment due by period
|
||||||||||||||||||
(In thousands)
|
|
Total
|
|
Less Than
One Year
|
|
1-3
Years
|
|
3-5
Years
|
|
More Than
5 Years
|
||||||||||
Contractual obligations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating lease obligations
|
|
$
|
18,689
|
|
|
$
|
4,434
|
|
|
$
|
5,710
|
|
|
$
|
4,156
|
|
|
$
|
4,389
|
|
Capital lease obligations(1)
|
|
37
|
|
|
36
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Pension plan obligations(2)
|
|
71,400
|
|
|
6,850
|
|
|
13,630
|
|
|
14,370
|
|
|
36,550
|
|
|||||
Postretirement benefits other than
pension plans(2)
|
|
12,982
|
|
|
1,087
|
|
|
2,311
|
|
|
2,468
|
|
|
7,116
|
|
|||||
Revolving credit facility
|
|
92,000
|
|
|
—
|
|
|
—
|
|
|
92,000
|
|
|
—
|
|
|||||
Purchase commitments(3)
|
|
61,244
|
|
|
61,244
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Derivative liabilities—noncurrent
|
|
1,612
|
|
|
—
|
|
|
1,612
|
|
|
—
|
|
|
—
|
|
|||||
Cumulative Preferred dividends, undeclared and unpaid-non-current
|
|
924
|
|
|
—
|
|
|
924
|
|
|
—
|
|
|
—
|
|
|||||
Total contractual obligations
|
|
$
|
258,888
|
|
|
$
|
73,651
|
|
|
$
|
24,188
|
|
|
$
|
112,994
|
|
|
$
|
48,055
|
|
(1)
|
Includes imputed interest of $2,000.
|
|
|
June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Maintenance:
|
|
|
|
|
|
|
||||||
Coffee brewing equipment
|
|
$
|
14,925
|
|
|
$
|
12,067
|
|
|
$
|
10,758
|
|
Building and facilities
|
|
106
|
|
|
542
|
|
|
345
|
|
|||
Vehicles, machinery and equipment
|
|
2,787
|
|
|
5,513
|
|
|
7,445
|
|
|||
Software, office furniture and equipment
|
|
3,270
|
|
|
3,660
|
|
|
698
|
|
|||
Capital expenditures, maintenance
|
|
$
|
21,088
|
|
|
$
|
21,782
|
|
|
$
|
19,246
|
|
|
|
|
|
|
|
|
||||||
Expansion Project:
|
|
|
|
|
|
|
||||||
Machinery and equipment
|
|
$
|
13,671
|
|
|
$
|
10,746
|
|
|
$
|
—
|
|
Capital expenditures, Expansion Project
|
|
$
|
13,671
|
|
|
$
|
10,746
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
||||||
New Facility Costs:
|
|
|
|
|
|
|
||||||
Building and facilities, including land
|
|
$
|
—
|
|
|
$
|
1,577
|
|
|
$
|
39,754
|
|
Machinery and equipment
|
|
—
|
|
|
2,489
|
|
|
20,089
|
|
|||
Software, office furniture and equipment
|
|
—
|
|
|
426
|
|
|
5,860
|
|
|||
Capital expenditures, New Facility
|
|
$
|
—
|
|
|
$
|
4,492
|
|
|
$
|
65,703
|
|
Total capital expenditures
|
|
$
|
34,759
|
|
|
$
|
37,020
|
|
|
$
|
84,949
|
|
|
Year Ended June 30,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Employee-related costs
|
$
|
1,487
|
|
|
$
|
612
|
|
|
$
|
506
|
|
Other
|
284
|
|
|
429
|
|
|
1,205
|
|
|||
Total
|
$
|
1,771
|
|
|
$
|
1,041
|
|
|
$
|
1,711
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
($ in thousands)
|
|
Principal
|
|
Interest Rate
|
|
Annual Interest Expense
|
|||
–150 basis points
|
|
$12,000
|
|
2.48
|
%
|
|
$
|
298
|
|
–100 basis points
|
|
$12,000
|
|
2.98
|
%
|
|
$
|
358
|
|
Unchanged
|
|
$12,000
|
|
3.98
|
%
|
|
$
|
478
|
|
+100 basis points
|
|
$12,000
|
|
4.98
|
%
|
|
$
|
598
|
|
+150 basis points
|
|
$12,000
|
|
5.48
|
%
|
|
$
|
658
|
|
|
|
Increase (Decrease) to Net Income
|
|
Increase (Decrease) to AOCI
|
||||||||||||
|
|
10% Increase in Underlying Rate
|
|
10% Decrease in Underlying Rate
|
|
10% Increase in Underlying Rate
|
|
10% Decrease in Underlying Rate
|
||||||||
(In thousands)
|
|
|||||||||||||||
Coffee-related derivative instruments(1)
|
|
$
|
674
|
|
|
$
|
(674
|
)
|
|
$
|
4,904
|
|
|
$
|
(4,904
|
)
|
Item 8.
|
Financial Statements and Supplementary Data
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
Item 11.
|
Executive Compensation
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Plan Category
|
|
Number of
Shares to be
Issued Upon
Exercise / Vesting of
Outstanding
Options or Rights(2)
|
|
Weighted
Average
Exercise
Price of
Outstanding
Options(3)
|
|
Number of
Shares
Remaining
Available
for Future
Issuance(4)
|
Equity compensation plans approved by stockholders(1)
|
|
491,301
|
|
$26.22
|
|
740,429
|
Equity compensation plans not approved by stockholders
|
|
—
|
|
—
|
|
—
|
Total
|
|
491,301
|
|
$26.22
|
|
740,429
|
(4)
|
The 2017 Plan authorizes the issuance of (i) 900,000 shares of common stock plus (ii) the number of shares of common stock subject to awards under the Company’s Prior Plans that are outstanding as of the Effective Date and that expire or are forfeited, cancelled or similarly lapse following the Effective Date. Subject to certain limitations, shares of common stock covered by awards granted under the 2017 Plan that are forfeited, expire or lapse, or are repurchased for or paid in cash, may be used again for new grants under the 2017 Plan. Shares of common stock granted under the 2017 Plan may be authorized but unissued shares, shares purchased on the open market or treasury shares. In no event will more than 900,000 shares of common stock be issuable pursuant to the exercise of incentive stock options under the 2017 Plan. The 2017 Plan provides for the grant of stock options (including incentive stock options and non-qualified stock options), stock appreciation rights, restricted stock, restricted stock units, dividend equivalents, performance shares and other stock- or cash-based awards to eligible participants. Non-employee directors of the Company and employees of the Company or any of its subsidiaries are eligible to receive awards under the 2017 Plan.
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accountant Fees and Services
|
Item 15.
|
Exhibits and Financial Statement Schedules
|
(a)
|
List of Financial Statements and Financial Statement Schedules:
|
|
Consolidated Balance Sheets as of June 30, 2019 and 2018.
|
|
Consolidated Statements of Operations for the Years Ended June 30, 2019, 2018 and 2017.
|
|
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended June 30, 2019, 2018 and 2017.
|
|
Consolidated Statements of Cash Flows for the Years Ended June 30, 2019, 2018 and 2017.
|
|
Consolidated Statements of Stockholders’ Equity for the Years Ended June 30, 2019, 2018 and 2017.
|
|
Notes to Consolidated Financial Statements.
|
(b)
|
Exhibits:
|
Exhibit No.
|
|
Description
|
|
|
|
2.1
|
|
|
|
|
|
2.2
|
|
|
|
|
|
2.3
|
|
|
|
|
|
3.1
|
|
|
|
|
|
3.2
|
|
|
|
|
|
3.3
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
3.4
|
|
|
4.1
|
|
|
|
|
|
4.2
|
|
|
|
|
|
4.3
|
|
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
10.6
|
|
|
|
|
|
10.7
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
10.8
|
|
|
|
|
|
10.9
|
|
|
|
|
|
10.10
|
|
|
|
|
|
10.11
|
|
|
|
|
|
10.12
|
|
|
|
|
|
10.13
|
|
|
|
|
|
10.14
|
|
|
|
|
|
10.15
|
|
|
|
|
|
10.16
|
|
|
|
|
|
10.17
|
|
|
|
|
|
10.18
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
10.19
|
|
|
|
|
|
10.20
|
|
|
|
|
|
10.21
|
|
|
|
|
|
10.22
|
|
|
|
|
|
10.23
|
|
|
|
|
|
10.24
|
|
|
|
|
|
10.25
|
|
|
|
|
|
10.26
|
|
|
|
|
|
10.27
|
|
|
|
|
|
10.28
|
|
|
|
|
|
10.29
|
|
|
|
|
|
10.30
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
10.31
|
|
|
|
|
|
10.32
|
|
|
|
|
|
10.33
|
|
|
|
|
|
10.34
|
|
|
|
|
|
10.35
|
|
|
|
|
|
10.36
|
|
|
|
|
|
10.37
|
|
|
|
|
|
10.38
|
|
|
|
|
|
10.39
|
|
|
|
|
|
10.40
|
|
|
|
|
|
10.41
|
|
|
|
|
|
10.42
|
|
|
|
|
|
10.43
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
10.44
|
|
|
|
|
|
10.45
|
|
|
|
|
|
10.46
|
|
|
|
|
|
10.47
|
|
|
|
|
|
10.48
|
|
|
|
|
|
10.49
|
|
|
|
|
|
10.50
|
|
|
|
|
|
10.51
|
|
|
|
|
|
10.52
|
|
|
|
|
|
10.53
|
|
|
|
|
|
10.54
|
|
|
|
|
|
10.55
|
|
|
|
|
|
Exhibit No.
|
|
Description
|
10.56
|
|
|
|
|
|
10.57
|
|
|
|
|
|
14.1
|
|
|
|
|
|
21.1
|
|
|
|
|
|
23.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
101
|
|
The following financial statements from the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2019, formatted in eXtensible Business Reporting Language: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive (Loss) Income, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Stockholders' Equity, and (vi) Notes to Consolidated Financial Statements (furnished herewith).
|
|
|
|
*
|
Pursuant to Item 601(b)(2) of Regulation S-K, the schedules and/or exhibits to this agreement have been omitted. The Registrant undertakes to supplementally furnish copies of the omitted schedules and/or exhibits to the Securities and Exchange Commission upon request.
|
**
|
Management contract or compensatory plan or arrangement.
|
Item 16.
|
Form 10-K Summary
|
|
|
|
|
|
|
|
FARMER BROS. CO.
|
||||
|
|
|
|||
|
By:
|
|
/s/ Christopher P. Mottern
|
||
|
|
|
Christopher P. Mottern
Interim President and Chief Executive Officer (chief executive officer) |
||
|
|
|
September 10, 2019
|
||
|
|
|
|
||
|
By:
|
|
/s/ David G. Robson
|
||
|
|
|
David G. Robson
Treasurer and Chief Financial Officer (principal financial and accounting officer) |
||
|
|
|
September 10, 2019
|
|
|
|
|
|
|
|
|
|
|
/s/ Randy E. Clark
|
|
Chairman of the Board and Director
|
|
September 10, 2019
|
Randy E. Clark
|
|
|
|
|
|
|
|
|
|
/s/ Allison M. Boersma
|
|
Director
|
|
September 10, 2019
|
Allison M. Boersma
|
|
|
|
|
|
|
|
|
|
/s/ Hamideh Assadi
|
|
|
|
|
Hamideh Assadi
|
|
Director
|
|
September 10, 2019
|
|
|
|
|
|
/s/ Stacy Loretz-Congdon
|
|
Director
|
|
September 10, 2019
|
Stacy Loretz-Congdon
|
|
|
|
|
|
|
|
|
|
/s/ Charles F. Marcy
|
|
Director
|
|
September 10, 2019
|
Charles F. Marcy
|
|
|
|
|
|
|
|
|
|
/s/ Christopher P. Mottern
|
|
Director
|
|
September 10, 2019
|
Christopher P. Mottern
|
|
|
|
|
|
|
|
|
|
/s/ David W. Ritterbush
|
|
Director
|
|
September 10, 2019
|
David W. Ritterbush
|
|
|
|
|
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of June 30,
|
||||||
|
2019
|
|
2018
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
6,983
|
|
|
$
|
2,438
|
|
Accounts receivable, net of allowance for doubtful accounts of $1,324 and $495, respectively
|
55,155
|
|
|
58,498
|
|
||
Inventories
|
87,910
|
|
|
104,431
|
|
||
Income tax receivable
|
1,191
|
|
|
305
|
|
||
Short-term derivative assets
|
1,865
|
|
|
—
|
|
||
Prepaid expenses
|
6,804
|
|
|
7,842
|
|
||
Total current assets
|
159,908
|
|
|
173,514
|
|
||
Property, plant and equipment, net
|
189,458
|
|
|
186,589
|
|
||
Goodwill
|
36,224
|
|
|
36,224
|
|
||
Intangible assets, net
|
28,878
|
|
|
31,515
|
|
||
Other assets
|
9,468
|
|
|
8,381
|
|
||
Long-term derivative assets
|
674
|
|
|
—
|
|
||
Deferred income taxes
|
—
|
|
|
39,308
|
|
||
Total assets
|
$
|
424,610
|
|
|
$
|
475,531
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
72,771
|
|
|
56,603
|
|
||
Accrued payroll expenses
|
14,518
|
|
|
17,918
|
|
||
Short-term borrowings under revolving credit facility
|
—
|
|
|
89,787
|
|
||
Short-term obligations under capital leases
|
34
|
|
|
190
|
|
||
Short-term derivative liabilities
|
1,474
|
|
|
3,300
|
|
||
Other current liabilities
|
7,309
|
|
|
10,659
|
|
||
Total current liabilities
|
96,106
|
|
|
178,457
|
|
||
Long-term borrowings under revolving credit facility
|
92,000
|
|
|
—
|
|
||
Accrued pension liabilities
|
47,216
|
|
|
40,380
|
|
||
Accrued postretirement benefits
|
23,024
|
|
|
20,473
|
|
||
Accrued workers’ compensation liabilities
|
4,747
|
|
|
5,354
|
|
||
Other long-term liabilities
|
4,023
|
|
|
1,812
|
|
||
Total liabilities
|
$
|
267,116
|
|
|
$
|
246,476
|
|
Commitments and contingencies
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $1.00 par value, 500,000 shares authorized; Series A Convertible Participating Cumulative Perpetual Preferred Stock, 21,000 shares authorized; 14,700 shares issued and outstanding as of June 30, 2019 and 2018, respectively; liquidation preference of $15,624 and $15,089 as of June 30, 2019 and 2018, respectively
|
15
|
|
|
15
|
|
||
Common stock, $1.00 par value, 25,000,000 shares authorized; 17,042,132 and 16,951,659 shares issued and outstanding at June 30, 2019 and 2018, respectively
|
17,042
|
|
|
16,952
|
|
||
Additional paid-in capital
|
57,912
|
|
|
55,965
|
|
||
Retained earnings
|
146,177
|
|
|
220,307
|
|
||
Unearned ESOP shares
|
—
|
|
|
(2,145
|
)
|
||
Accumulated other comprehensive loss
|
(63,652
|
)
|
|
(62,039
|
)
|
||
Total stockholders’ equity
|
$
|
157,494
|
|
|
$
|
229,055
|
|
Total liabilities and stockholders’ equity
|
$
|
424,610
|
|
|
$
|
475,531
|
|
|
For the Years Ended June 30,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net sales
|
$
|
595,942
|
|
|
$
|
606,544
|
|
|
$
|
541,500
|
|
Cost of goods sold
|
416,840
|
|
|
399,155
|
|
|
354,649
|
|
|||
Gross profit
|
179,102
|
|
|
207,389
|
|
|
186,851
|
|
|||
Selling expenses
|
139,647
|
|
|
153,391
|
|
|
133,534
|
|
|||
General and administrative expenses
|
48,959
|
|
|
49,429
|
|
|
42,945
|
|
|||
Restructuring and other transition expenses
|
4,733
|
|
|
662
|
|
|
11,016
|
|
|||
Net gain from sale of Torrance Facility
|
—
|
|
|
—
|
|
|
(37,449
|
)
|
|||
Net gains from sale of Spice Assets
|
(593
|
)
|
|
(770
|
)
|
|
(919
|
)
|
|||
Net losses (gains) from sales of other assets
|
1,058
|
|
|
(196
|
)
|
|
(1,210
|
)
|
|||
Impairment losses on intangible assets
|
—
|
|
|
3,820
|
|
|
—
|
|
|||
Operating expenses
|
193,804
|
|
|
206,336
|
|
|
147,917
|
|
|||
(Loss) income from operations
|
(14,702
|
)
|
|
1,053
|
|
|
38,934
|
|
|||
Other (expense) income:
|
|
|
|
|
|
||||||
Dividend income
|
—
|
|
|
12
|
|
|
1,007
|
|
|||
Interest income
|
—
|
|
|
2
|
|
|
567
|
|
|||
Interest expense
|
(12,000
|
)
|
|
(9,757
|
)
|
|
(8,601
|
)
|
|||
Pension settlement charge
|
(10,948
|
)
|
|
—
|
|
|
—
|
|
|||
Other, net
|
4,166
|
|
|
7,722
|
|
|
5,459
|
|
|||
Total other (expense) income
|
(18,782
|
)
|
|
(2,021
|
)
|
|
(1,568
|
)
|
|||
(Loss) income before taxes
|
(33,484
|
)
|
|
(968
|
)
|
|
37,366
|
|
|||
Income tax expense
|
40,111
|
|
|
17,312
|
|
|
14,815
|
|
|||
Net (loss) income
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
Less: Cumulative preferred dividends, undeclared and unpaid
|
535
|
|
|
389
|
|
|
—
|
|
|||
Net (loss) income available to common stockholders
|
$
|
(74,130
|
)
|
|
$
|
(18,669
|
)
|
|
$
|
22,551
|
|
Net (loss) income available to common stockholders per common share—basic
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.35
|
|
Net (loss) income available to common stockholders per common share—diluted
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.34
|
|
Weighted average common shares outstanding—basic
|
16,996,354
|
|
|
16,815,020
|
|
|
16,668,745
|
|
|||
Weighted average common shares outstanding—diluted
|
16,996,354
|
|
|
16,815,020
|
|
|
16,785,752
|
|
|
For the Years Ended June 30,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Net (loss) income
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Unrealized losses on derivative instruments designated as cash flow hedges, net of tax
|
(9,198
|
)
|
|
(5,922
|
)
|
|
(2,900
|
)
|
|||
Losses on derivative instruments designated as cash flow hedges reclassified to cost of goods sold, net of tax
|
9,196
|
|
|
800
|
|
|
510
|
|
|||
Change in the funded status of retiree benefit obligations, net of tax
|
(9,777
|
)
|
|
4,576
|
|
|
7,466
|
|
|||
Pension settlement charge, net of tax
|
8,165
|
|
|
—
|
|
|
—
|
|
|||
Total comprehensive (loss) income, net of tax
|
$
|
(75,209
|
)
|
|
$
|
(18,826
|
)
|
|
$
|
27,627
|
|
FARMER BROS. CO.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands, except share and per share data)
|
|||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Preferred Shares
|
|
Preferred Stock Amount
|
|
Common
Shares
|
|
Common Stock
Amount
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Unearned
ESOP
Shares
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
|
||||||||||||||||
Balance at June 30, 2016
|
—
|
|
|
$
|
—
|
|
|
16,781,561
|
|
|
$
|
16,782
|
|
|
$
|
39,096
|
|
|
$
|
214,442
|
|
|
$
|
(6,434
|
)
|
|
$
|
(66,569
|
)
|
|
$
|
197,317
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22,551
|
|
|
—
|
|
|
—
|
|
|
22,551
|
|
|||||||
Unrealized losses on derivative instruments designated as cash flow hedges, net of reclassifications to cost of goods sold, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,390
|
)
|
|
(2,390
|
)
|
|||||||
Change in the funded status of retiree benefit obligations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,466
|
|
|
7,466
|
|
|||||||
ESOP compensation expense, including reclassifications
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
342
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
2,487
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
(889
|
)
|
|
(1
|
)
|
|
1,473
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,472
|
|
|||||||
Stock option exercises
|
—
|
|
|
—
|
|
|
82,803
|
|
|
83
|
|
|
604
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
687
|
|
|||||||
Shares withheld to cover taxes
|
—
|
|
|
—
|
|
|
(17,473
|
)
|
|
(18
|
)
|
|
(20
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|||||||
Balance at June 30, 2017
|
—
|
|
|
—
|
|
|
16,846,002
|
|
|
16,846
|
|
|
41,495
|
|
|
236,993
|
|
|
(4,289
|
)
|
|
(61,493
|
)
|
|
229,552
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,280
|
)
|
|
—
|
|
|
—
|
|
|
(18,280
|
)
|
|||||||
Adjustment due to the adoption of ASU 2017-12
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
342
|
|
|
—
|
|
|
(209
|
)
|
|
133
|
|
|||||||
Adjustment due to the adoption of ASU 2016-09
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,641
|
|
|
—
|
|
|
—
|
|
|
1,641
|
|
|||||||
Unrealized losses on derivative instruments designated as cash flow hedges, net of reclassifications to cost of goods sold, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,913
|
)
|
|
(4,913
|
)
|
|||||||
Change in the funded status of retiree benefit obligations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,576
|
|
|
4,576
|
|
|||||||
ESOP compensation expense, including reclassifications
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
150
|
|
|
—
|
|
|
2,144
|
|
|
—
|
|
|
2,294
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
9,155
|
|
|
9
|
|
|
1,518
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,527
|
|
|||||||
Stock option exercises
|
—
|
|
|
—
|
|
|
96,502
|
|
|
97
|
|
|
1,245
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,342
|
|
|||||||
Consideration for Boyd Coffee acquisition
|
14,700
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
11,557
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,572
|
|
|||||||
Cumulative preferred dividends, undeclared and unpaid
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(389
|
)
|
|
—
|
|
|
—
|
|
|
(389
|
)
|
|||||||
Balance at June 30, 2018
|
14,700
|
|
|
15
|
|
|
16,951,659
|
|
|
16,952
|
|
|
55,965
|
|
|
220,307
|
|
|
(2,145
|
)
|
|
(62,039
|
)
|
|
229,055
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(73,595
|
)
|
|
—
|
|
|
—
|
|
|
(73,595
|
)
|
|||||||
Net reclassification of unrealized losses on cash flow hedges, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||||||
Pension settlement charge, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,165
|
|
|
8,165
|
|
|||||||
Change in the funded status of retiree benefit obligations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,777
|
)
|
|
(9,777
|
)
|
|||||||
ESOP compensation expense, including reclassifications
|
—
|
|
|
—
|
|
|
37,571
|
|
|
37
|
|
|
364
|
|
|
—
|
|
|
2,145
|
|
|
—
|
|
|
2,546
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
18,298
|
|
|
18
|
|
|
1,111
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,129
|
|
|||||||
Stock option exercises
|
—
|
|
|
—
|
|
|
34,604
|
|
|
35
|
|
|
472
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
507
|
|
|||||||
Cumulative preferred dividends, undeclared and unpaid
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(535
|
)
|
|
—
|
|
|
—
|
|
|
(535
|
)
|
|||||||
Balance at June 30, 2019
|
14,700
|
|
|
$
|
15
|
|
|
17,042,132
|
|
|
$
|
17,042
|
|
|
$
|
57,912
|
|
|
$
|
146,177
|
|
|
$
|
—
|
|
|
$
|
(63,652
|
)
|
|
$
|
157,494
|
|
FARMER BROS. CO.
|
|||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||||||||
(In thousands)
|
|||||||||||
|
For the Years Ended June 30,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net (loss) income
|
$
|
(73,595
|
)
|
|
$
|
(18,280
|
)
|
|
$
|
22,551
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|||||||||||
Depreciation and amortization
|
31,065
|
|
|
30,464
|
|
|
22,970
|
|
|||
Provision for doubtful accounts
|
1,363
|
|
|
137
|
|
|
325
|
|
|||
Impairment losses on intangible assets
|
—
|
|
|
3,820
|
|
|
—
|
|
|||
Change in estimated fair value of contingent earnout consideration
|
—
|
|
|
(500
|
)
|
|
—
|
|
|||
Restructuring and other transition expenses, net of payments
|
1,172
|
|
|
(1,185
|
)
|
|
1,034
|
|
|||
Interest on sale-leaseback financing obligation
|
—
|
|
|
—
|
|
|
681
|
|
|||
Deferred income taxes
|
41,654
|
|
|
17,155
|
|
|
14,343
|
|
|||
Pension settlement cost
|
10,948
|
|
|
—
|
|
|
—
|
|
|||
Net gain from sale of Torrance Facility
|
—
|
|
|
—
|
|
|
(37,449
|
)
|
|||
Net gains from sales of Spice Assets and other assets
|
466
|
|
|
(995
|
)
|
|
(2,129
|
)
|
|||
ESOP and share-based compensation expense
|
3,674
|
|
|
3,822
|
|
|
3,959
|
|
|||
Net losses on derivative instruments and investments
|
9,196
|
|
|
1,982
|
|
|
2,361
|
|
|||
Change in operating assets and liabilities:
|
|||||||||||
Accounts receivable
|
2,757
|
|
|
(4,628
|
)
|
|
(14
|
)
|
|||
Inventories
|
16,192
|
|
|
(15,513
|
)
|
|
(8,041
|
)
|
|||
Derivative (liabilities) assets, net
|
(18,901
|
)
|
|
(7,782
|
)
|
|
2,264
|
|
|||
Other assets
|
114
|
|
|
1,073
|
|
|
22,932
|
|
|||
Accounts payable
|
16,546
|
|
|
3,864
|
|
|
8,885
|
|
|||
Accrued expenses and other liabilities
|
(7,201
|
)
|
|
(4,579
|
)
|
|
(12,560
|
)
|
|||
Net cash provided by operating activities
|
$
|
35,450
|
|
|
$
|
8,855
|
|
|
$
|
42,112
|
|
Cash flows from investing activities:
|
|||||||||||
Acquisitions of businesses, net of cash acquired
|
$
|
—
|
|
|
$
|
(39,608
|
)
|
|
$
|
(25,853
|
)
|
Purchases of property, plant and equipment
|
(34,760
|
)
|
|
(35,443
|
)
|
|
(45,195
|
)
|
|||
Purchases of assets for construction of New Facility
|
—
|
|
|
(1,577
|
)
|
|
(39,754
|
)
|
|||
Proceeds from sales of property, plant and equipment
|
2,399
|
|
|
1,988
|
|
|
4,078
|
|
|||
Net cash used in investing activities
|
$
|
(32,361
|
)
|
|
$
|
(74,640
|
)
|
|
$
|
(106,724
|
)
|
Cash flows from financing activities:
|
|||||||||||
Proceeds from revolving credit facility
|
$
|
50,642
|
|
|
$
|
85,315
|
|
|
$
|
77,985
|
|
Repayments on revolving credit facility
|
(48,429
|
)
|
|
(23,149
|
)
|
|
(50,473
|
)
|
|||
Proceeds from sale-leaseback financing obligation
|
—
|
|
|
—
|
|
|
42,455
|
|
|||
Proceeds from New Facility lease financing obligation
|
—
|
|
|
—
|
|
|
16,346
|
|
|||
Repayments of New Facility lease financing
|
—
|
|
|
—
|
|
|
(35,772
|
)
|
|||
Payments of capital lease obligations
|
(215
|
)
|
|
(947
|
)
|
|
(1,433
|
)
|
|||
Payment of financing costs
|
(1,049
|
)
|
|
(579
|
)
|
|
—
|
|
|||
Proceeds from stock option exercises
|
507
|
|
|
1,342
|
|
|
688
|
|
|||
Tax withholding payment - net share settlement of equity awards
|
—
|
|
|
—
|
|
|
(38
|
)
|
|||
Net cash provided by financing activities
|
$
|
1,456
|
|
|
$
|
61,982
|
|
|
$
|
49,758
|
|
Net (decrease) increase in cash and cash equivalents
|
$
|
4,545
|
|
|
$
|
(3,803
|
)
|
|
$
|
(14,854
|
)
|
Cash and cash equivalents at beginning of year
|
2,438
|
|
|
6,241
|
|
|
21,095
|
|
|||
Cash and cash equivalents at end of year
|
$
|
6,983
|
|
|
$
|
2,438
|
|
|
$
|
6,241
|
|
FARMER BROS. CO.
|
|||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
|
|||||||||||
(In thousands)
|
|||||||||||
|
For the Years Ended June 30,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
5,512
|
|
|
$
|
3,177
|
|
|
$
|
1,504
|
|
Cash paid for income taxes
|
$
|
107
|
|
|
$
|
144
|
|
|
$
|
567
|
|
Supplemental disclosure of non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Equipment acquired under capital leases
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
417
|
|
Net change in derivative assets and liabilities
included in other comprehensive (loss) income, net of tax
|
$
|
(2
|
)
|
|
$
|
(5,122
|
)
|
|
$
|
(2,390
|
)
|
Non-cash additions to property, plant and equipment
|
$
|
2,619
|
|
|
$
|
2,814
|
|
|
$
|
5,517
|
|
Non-cash portion of earnout receivable recognized—Spice Assets sale
|
$
|
—
|
|
|
$
|
298
|
|
|
$
|
419
|
|
Non-cash portion of earnout payable recognized—China Mist acquisition
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
500
|
|
Non-cash portion of earnout payable recognized—West Coast Coffee acquisition
|
$
|
400
|
|
|
$
|
—
|
|
|
$
|
600
|
|
Non-cash working capital adjustment payable recognized—China Mist acquisition
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
553
|
|
Non-cash receivable from West Coast Coffee—post-closing final working capital adjustment
|
$
|
—
|
|
|
$
|
218
|
|
|
$
|
—
|
|
Non-cash post-closing working capital adjustment—Boyd Coffee acquisition
|
$
|
2,277
|
|
|
$
|
1,056
|
|
|
$
|
—
|
|
Non-cash Issuance of 401-K shares of Common Stock
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-cash consideration given-Issuance of Series A Preferred Stock
|
$
|
—
|
|
|
$
|
11,756
|
|
|
$
|
—
|
|
Option costs paid with exercised shares
|
|
|
$
|
—
|
|
|
$
|
550
|
|
||
Cumulative preferred dividends, undeclared and unpaid
|
$
|
534
|
|
|
$
|
389
|
|
|
$
|
—
|
|
Derivative Treatment
|
|
Accounting Method
|
Normal purchases and normal sales exception
|
|
Accrual accounting
|
Designated in a qualifying hedging relationship
|
|
Hedge accounting
|
All other derivative instruments
|
|
Mark-to-market accounting
|
Buildings and facilities
|
10 to 30 years
|
Machinery and equipment
|
3 to 10 years
|
Equipment under capital leases
|
Shorter of term of lease or estimated useful life
|
Office furniture and equipment
|
5 to 7 years
|
Capitalized software
|
3 to 5 years
|
|
|
For the Year Ended June 30, 2018
|
||||||||||
(In thousands)
|
|
As Previously Reported
|
|
ASU 2017-07 Adjustments
|
|
As Adjusted
|
||||||
Cost of goods sold
|
|
$
|
399,502
|
|
|
$
|
(347
|
)
|
|
$
|
399,155
|
|
Gross profit
|
|
$
|
207,042
|
|
|
$
|
347
|
|
|
$
|
207,389
|
|
Selling expenses
|
|
$
|
154,539
|
|
|
$
|
(1,148
|
)
|
|
$
|
153,391
|
|
General and administrative expenses
|
|
$
|
47,863
|
|
|
$
|
1,566
|
|
|
$
|
49,429
|
|
Operating expenses
|
|
$
|
205,918
|
|
|
$
|
418
|
|
|
$
|
206,336
|
|
Income from operations
|
|
$
|
1,124
|
|
|
$
|
(71
|
)
|
|
$
|
1,053
|
|
Interest expense
|
|
$
|
(3,177
|
)
|
|
$
|
(6,580
|
)
|
|
$
|
(9,757
|
)
|
Other, net
|
|
$
|
1,071
|
|
|
$
|
6,651
|
|
|
$
|
7,722
|
|
Total other (expense) income
|
|
$
|
(2,092
|
)
|
|
$
|
71
|
|
|
$
|
(2,021
|
)
|
|
|
For the Year Ended June 30, 2017
|
||||||||||
(In thousands)
|
|
As Previously Reported
|
|
ASU 2017-07 Adjustments
|
|
As Adjusted
|
||||||
Cost of goods sold
|
|
$
|
354,622
|
|
|
$
|
27
|
|
|
$
|
354,649
|
|
Gross profit
|
|
$
|
186,878
|
|
|
$
|
(27
|
)
|
|
$
|
186,851
|
|
Selling expenses
|
|
$
|
133,329
|
|
|
$
|
205
|
|
|
$
|
133,534
|
|
General and administrative expenses
|
|
$
|
42,933
|
|
|
$
|
12
|
|
|
$
|
42,945
|
|
Operating expenses
|
|
$
|
147,700
|
|
|
$
|
217
|
|
|
$
|
147,917
|
|
Income from operations
|
|
$
|
39,178
|
|
|
$
|
(244
|
)
|
|
$
|
38,934
|
|
Interest expense
|
|
$
|
(2,185
|
)
|
|
$
|
(6,416
|
)
|
|
$
|
(8,601
|
)
|
Other, net
|
|
$
|
(1,201
|
)
|
|
$
|
6,660
|
|
|
$
|
5,459
|
|
Total other (expense) income
|
|
$
|
(1,812
|
)
|
|
$
|
244
|
|
|
$
|
(1,568
|
)
|
(In thousands)
|
Fair Value
|
|
Estimated
Useful Life
(years)
|
||
|
|
|
|
||
Cash paid
|
$
|
38,871
|
|
|
|
Holdback Cash Amount
|
3,150
|
|
|
|
|
Multiemployer Plan Holdback
|
1,056
|
|
|
|
|
Fair value of Series A Preferred Stock (14,700 shares)(1)
|
11,756
|
|
|
|
|
Fair value of Holdback Stock (6,300 shares)(1)
|
4,825
|
|
|
|
|
Estimated post-closing net working capital adjustment
|
(8,059
|
)
|
|
|
|
Total consideration
|
$
|
51,599
|
|
|
|
|
|
|
|
||
Accounts receivable
|
$
|
7,503
|
|
|
|
Inventory
|
9,415
|
|
|
|
|
Prepaid expense and other assets
|
1,951
|
|
|
|
|
Property, plant and equipment
|
4,936
|
|
|
|
|
Goodwill
|
25,395
|
|
|
|
|
Intangible assets:
|
|
|
|
||
Customer relationships
|
16,000
|
|
|
10
|
|
Trade name/trademark—indefinite-lived
|
3,100
|
|
|
|
|
Accounts payable
|
(15,080
|
)
|
|
|
|
Other liabilities
|
(1,621
|
)
|
|
|
|
Total consideration
|
$
|
51,599
|
|
|
|
(In thousands)
|
|
For the Year Ended June 30,
|
||
|
|
2018
|
||
Net sales
|
|
$
|
67,385
|
|
Income before taxes
|
|
$
|
1,572
|
|
|
|
For the Year Ended June 30,
|
|||||||
(In thousands)
|
|
|
2018
|
|
2017
|
||||
Net sales
|
|
|
$
|
628,526
|
|
|
$
|
636,969
|
|
(Loss) income before taxes
|
|
|
$
|
(642
|
)
|
|
$
|
36,969
|
|
(In thousands)
|
Balances as of
June 30, 2017
|
|
Additions
|
|
Payments
|
|
Non-Cash Settled
|
|
Adjustments
|
|
Balances as of
June 30, 2019 |
||||||||||||
Employee-related costs
|
$
|
—
|
|
|
$
|
2,634
|
|
|
$
|
2,605
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29
|
|
Other
|
—
|
|
|
1,949
|
|
|
1,918
|
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
||||||
Total
|
$
|
—
|
|
|
$
|
4,583
|
|
|
$
|
4,523
|
|
|
$
|
—
|
|
|
$
|
(31
|
)
|
|
$
|
29
|
|
|
Year Ended June 30,
|
||||||||||
(In thousands)
|
2019
|
|
2018
|
|
2017
|
||||||
Employee-related costs
|
$
|
1,487
|
|
|
$
|
612
|
|
|
$
|
506
|
|
Other
|
284
|
|
|
429
|
|
|
1,205
|
|
|||
Total
|
$
|
1,771
|
|
|
$
|
1,041
|
|
|
$
|
1,711
|
|
|
|
As of June 30,
|
||||
(In thousands)
|
|
2019
|
|
2018
|
||
Derivative instruments designated as cash flow hedges:
|
|
|
|
|
||
Long coffee pounds
|
|
42,113
|
|
|
40,913
|
|
Derivative instruments not designated as cash flow hedges:
|
|
|
|
|
||
Long coffee pounds
|
|
6,070
|
|
|
2,546
|
|
Total
|
|
48,183
|
|
|
43,459
|
|
|
|
Derivative Instruments
Designated as Cash Flow Hedges
|
|
Derivative Instruments Not Designated as Accounting Hedges
|
||||||||||||
|
|
As of June 30,
|
|
As of June 30,
|
||||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Financial Statement Location:
|
|
|
|
|
|
|
|
|
||||||||
Short-term derivative assets:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative instruments(1)
|
|
$
|
1,254
|
|
|
$
|
—
|
|
|
$
|
611
|
|
|
$
|
—
|
|
Long-term derivative assets:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative instruments(2)
|
|
$
|
671
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
—
|
|
Short-term derivative liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative instruments(3)
|
|
$
|
1,114
|
|
|
$
|
3,081
|
|
|
$
|
114
|
|
|
$
|
219
|
|
Interest rate swap derivative instruments(3)
|
|
$
|
246
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term derivative liabilities:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative instruments(4)
|
|
$
|
13
|
|
|
$
|
386
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate swap derivative instruments(4)
|
|
$
|
1,599
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Year Ended June 30,
|
|
Financial Statement Classification
|
|||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
|
|
|||||||
Net losses recognized in AOCI - Interest rate swap
|
|
$
|
(1,791
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
AOCI
|
Net gains recognized from AOCI to earnings - Interest rate swap
|
|
$
|
46
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Interest Expense
|
Net losses recognized in AOCI - Coffee-related
|
|
$
|
(7,407
|
)
|
|
$
|
(8,420
|
)
|
|
$
|
(4,746
|
)
|
|
|
AOCI
|
Net losses recognized in earnings - Coffee-related
|
|
$
|
(9,242
|
)
|
|
$
|
(1,179
|
)
|
|
$
|
(835
|
)
|
|
|
Costs of goods sold
|
Net gains (losses) recognized in earnings (ineffective portion)
|
|
$
|
—
|
|
|
$
|
48
|
|
|
$
|
(456
|
)
|
|
|
Other, net
|
|
|
Year Ended June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net losses on coffee-related derivative instruments
|
|
$
|
(2,252
|
)
|
|
$
|
(469
|
)
|
|
$
|
(1,812
|
)
|
Net gains on investments
|
|
—
|
|
|
7
|
|
|
286
|
|
|||
Net losses on derivative instruments and investments(1)
|
|
(2,252
|
)
|
|
(462
|
)
|
|
(1,526
|
)
|
|||
Non-operating pension and other postretirement benefit plans cost(2)
|
|
6,315
|
|
|
6,651
|
|
|
6,660
|
|
|||
Other gains, net
|
|
103
|
|
|
1,533
|
|
|
325
|
|
|||
Other, net
|
|
$
|
4,166
|
|
|
$
|
7,722
|
|
|
$
|
5,459
|
|
(In thousands)
|
|
|
|
Gross Amount Reported on Balance Sheet
|
|
Netting Adjustments
|
|
Cash Collateral Posted
|
|
Net Exposure
|
||||||||
June 30, 2019
|
|
Derivative Assets
|
|
$
|
2,539
|
|
|
$
|
(698
|
)
|
|
$
|
—
|
|
|
$
|
1,841
|
|
|
|
Derivative Liabilities
|
|
$
|
3,086
|
|
|
$
|
(698
|
)
|
|
$
|
—
|
|
|
$
|
2,388
|
|
June 30, 2018
|
|
Derivative Assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Derivative Liabilities
|
|
$
|
3,686
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,686
|
|
|
|
Year Ended June 30,
|
|||||||
(In thousands)
|
|
|
2018
|
|
2017
|
||||
Total gains recognized from trading securities
|
|
|
$
|
7
|
|
|
$
|
286
|
|
Less: Realized gains from sales of trading securities
|
|
|
7
|
|
|
1,909
|
|
||
Unrealized (losses) gains from trading securities
|
|
|
$
|
—
|
|
|
$
|
(1,623
|
)
|
(In thousands)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
As of June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments designated as cash flow hedges:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative assets(1)
|
|
$
|
1,925
|
|
|
$
|
—
|
|
|
$
|
1,925
|
|
|
$
|
—
|
|
Coffee-related derivative liabilities(1)
|
|
$
|
1,127
|
|
|
$
|
—
|
|
|
$
|
1,127
|
|
|
$
|
—
|
|
Interest rate swap derivative liabilities(2)
|
|
$
|
1,845
|
|
|
$
|
—
|
|
|
$
|
1,845
|
|
|
$
|
—
|
|
Derivative instruments not designated as accounting hedges:
|
|
|
|
|
|
|
|
|
|
|
||||||
Coffee-related derivative assets(1)
|
|
$
|
614
|
|
|
$
|
—
|
|
|
$
|
614
|
|
|
$
|
—
|
|
Coffee-related derivative liabilities(1)
|
|
$
|
114
|
|
|
$
|
—
|
|
|
$
|
114
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
||||||||
(In thousands)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
As of June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments designated as cash flow hedges:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative liabilities(1)
|
|
$
|
3,467
|
|
|
$
|
—
|
|
|
$
|
3,467
|
|
|
$
|
—
|
|
Derivative instruments not designated as accounting hedges:
|
|
|
|
|
|
|
|
|
||||||||
Coffee-related derivative liabilities(1)
|
|
$
|
219
|
|
|
$
|
—
|
|
|
219
|
|
|
$
|
—
|
|
(1)
|
The Company's coffee-related derivative instruments are traded over-the-counter and, therefore, classified as Level 2.
|
(2)
|
The Company's interest rate swap derivative instrument are model-derived valuations with directly or indirectly observable significant inputs such as interest rate and, therefore, classified as Level 2.
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Trade receivables
|
|
$
|
53,593
|
|
|
$
|
54,547
|
|
Other receivables(1)
|
|
2,886
|
|
|
4,446
|
|
||
Allowance for doubtful accounts
|
|
(1,324
|
)
|
|
(495
|
)
|
||
Accounts receivable, net
|
|
$
|
55,155
|
|
|
$
|
58,498
|
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Coffee
|
|
|
|
|
||||
Processed
|
|
$
|
25,769
|
|
|
$
|
26,882
|
|
Unprocessed
|
|
33,259
|
|
|
37,097
|
|
||
Total
|
|
$
|
59,028
|
|
|
$
|
63,979
|
|
Tea and culinary products
|
|
|
|
|
||||
Processed
|
|
$
|
21,767
|
|
|
$
|
32,406
|
|
Unprocessed
|
|
74
|
|
|
1,161
|
|
||
Total
|
|
$
|
21,841
|
|
|
$
|
33,567
|
|
Coffee brewing equipment parts
|
|
$
|
7,041
|
|
|
$
|
6,885
|
|
Total inventories
|
|
$
|
87,910
|
|
|
$
|
104,431
|
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Buildings and facilities
|
|
$
|
107,915
|
|
|
$
|
108,590
|
|
Machinery and equipment
|
|
248,539
|
|
|
231,581
|
|
||
Equipment under capital leases
|
|
938
|
|
|
1,408
|
|
||
Capitalized software
|
|
27,666
|
|
|
24,569
|
|
||
Office furniture and equipment
|
|
14,035
|
|
|
13,721
|
|
||
|
|
$
|
399,093
|
|
|
$
|
379,869
|
|
Accumulated depreciation
|
|
(225,826
|
)
|
|
(209,498
|
)
|
||
Land
|
|
16,191
|
|
|
16,218
|
|
||
Property, plant and equipment, net
|
|
$
|
189,458
|
|
|
$
|
186,589
|
|
Balance at June 30, 2017
|
|
$
|
10,996
|
|
Final Purchase Price Allocation Adjustment (West Coast Coffee)
|
|
(167
|
)
|
|
Additions (Boyd Coffee)
|
|
25,395
|
|
|
Balance at June 30, 2018
|
|
$
|
36,224
|
|
Additions
|
|
—
|
|
|
Balance at June 30, 2019
|
|
$
|
36,224
|
|
|
|
|
|
As of June 30,
|
||||||||||||||||||||||
|
|
Weighted
Average
Amortization
Period as of
June 30, 2019
|
|
2019
|
|
2018
|
||||||||||||||||||||
(In thousands)
|
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|||||||||||||
Amortized intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer relationships
|
|
7.7
|
|
$
|
33,003
|
|
|
$
|
(15,291
|
)
|
|
$
|
17,712
|
|
|
$
|
33,003
|
|
|
$
|
(12,903
|
)
|
|
$
|
20,100
|
|
Non-compete agreements
|
|
2.7
|
|
220
|
|
|
(122
|
)
|
|
98
|
|
|
220
|
|
|
(81
|
)
|
|
139
|
|
||||||
Recipes
|
|
4.3
|
|
930
|
|
|
(354
|
)
|
|
576
|
|
|
930
|
|
|
(221
|
)
|
|
709
|
|
||||||
Trade name/brand name
|
|
5.3
|
|
510
|
|
|
(346
|
)
|
|
164
|
|
|
510
|
|
|
(271
|
)
|
|
239
|
|
||||||
Total amortized intangible assets
|
|
|
|
$
|
34,663
|
|
|
$
|
(16,113
|
)
|
|
$
|
18,550
|
|
|
$
|
34,663
|
|
|
$
|
(13,476
|
)
|
|
$
|
21,187
|
|
Unamortized intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trademarks, trade names and brand name with indefinite lives
|
|
|
|
$
|
10,328
|
|
|
$
|
—
|
|
|
$
|
10,328
|
|
|
$
|
10,328
|
|
|
$
|
—
|
|
|
$
|
10,328
|
|
Total unamortized intangible assets
|
|
|
|
$
|
10,328
|
|
|
$
|
—
|
|
|
$
|
10,328
|
|
|
$
|
10,328
|
|
|
$
|
—
|
|
|
$
|
10,328
|
|
Total intangible assets
|
|
|
|
$
|
44,991
|
|
|
$
|
(16,113
|
)
|
|
$
|
28,878
|
|
|
$
|
44,991
|
|
|
$
|
(13,476
|
)
|
|
$
|
31,515
|
|
|
|
Farmer Bros. Plan
As of June 30,
|
|
Brewmatic Plan
As of June 30,
|
|
Hourly Employees’ Plan
As of June 30,
|
|
Total
|
||||||||||||||||||||||||
($ in thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||
Change in projected benefit obligation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Benefit obligation at the beginning of the year
|
|
$
|
137,175
|
|
|
$
|
146,291
|
|
|
$
|
3,724
|
|
|
$
|
4,079
|
|
|
$
|
4,040
|
|
|
$
|
4,329
|
|
|
$
|
144,939
|
|
|
$
|
154,699
|
|
Interest cost
|
|
2,722
|
|
|
5,417
|
|
|
2,339
|
|
|
149
|
|
|
161
|
|
|
163
|
|
|
5,222
|
|
|
5,729
|
|
||||||||
Actuarial (gain) loss
|
|
(1,571
|
)
|
|
(5,956
|
)
|
|
8,482
|
|
|
(227
|
)
|
|
349
|
|
|
(370
|
)
|
|
7,260
|
|
|
(6,553
|
)
|
||||||||
Benefits paid
|
|
(3,574
|
)
|
|
(8,577
|
)
|
|
(3,097
|
)
|
|
(277
|
)
|
|
(75
|
)
|
|
(82
|
)
|
|
(6,746
|
)
|
|
(8,936
|
)
|
||||||||
Pension settlement
|
|
(3,162
|
)
|
|
—
|
|
|
(21,286
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,448
|
)
|
|
—
|
|
||||||||
Other - Plan merger
|
|
$
|
(131,590
|
)
|
|
—
|
|
|
131,590
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Projected benefit obligation at the end of the year
|
|
$
|
—
|
|
|
$
|
137,175
|
|
|
$
|
121,752
|
|
|
$
|
3,724
|
|
|
$
|
4,475
|
|
|
$
|
4,040
|
|
|
$
|
126,227
|
|
|
$
|
144,939
|
|
Change in plan assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fair value of plan assets at the beginning of the year
|
|
$
|
97,211
|
|
|
$
|
97,304
|
|
|
$
|
3,719
|
|
|
$
|
3,115
|
|
|
$
|
3,629
|
|
|
$
|
2,999
|
|
|
$
|
104,559
|
|
|
$
|
103,418
|
|
Actual return on plan assets
|
|
(6,236
|
)
|
|
5,874
|
|
|
9,325
|
|
|
201
|
|
|
224
|
|
|
198
|
|
|
3,313
|
|
|
6,273
|
|
||||||||
Employer contributions
|
|
1,525
|
|
|
2,610
|
|
|
1,800
|
|
|
680
|
|
|
—
|
|
|
514
|
|
|
3,325
|
|
|
3,804
|
|
||||||||
Benefits paid
|
|
(3,574
|
)
|
|
(8,577
|
)
|
|
(3,097
|
)
|
|
(277
|
)
|
|
(75
|
)
|
|
(82
|
)
|
|
(6,746
|
)
|
|
(8,936
|
)
|
||||||||
Pension settlement
|
|
(3,162
|
)
|
|
—
|
|
|
(22,100
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25,262
|
)
|
|
—
|
|
||||||||
Other - Plan merger
|
|
(85,764
|
)
|
|
—
|
|
|
85,764
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Fair value of plan assets at the end of the year
|
|
$
|
—
|
|
|
$
|
97,211
|
|
|
$
|
75,411
|
|
|
$
|
3,719
|
|
|
$
|
3,778
|
|
|
$
|
3,629
|
|
|
$
|
79,189
|
|
|
$
|
104,559
|
|
Funded status at end of year (underfunded) overfunded
|
|
$
|
—
|
|
|
$
|
(39,964
|
)
|
|
$
|
(46,341
|
)
|
|
$
|
(5
|
)
|
|
$
|
(697
|
)
|
|
$
|
(411
|
)
|
|
$
|
(47,038
|
)
|
|
$
|
(40,380
|
)
|
Amounts recognized in consolidated balance sheets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Non-current liabilities
|
|
—
|
|
|
(39,964
|
)
|
|
(46,341
|
)
|
|
(5
|
)
|
|
(697
|
)
|
|
(411
|
)
|
|
(47,038
|
)
|
|
(40,380
|
)
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
(39,964
|
)
|
|
$
|
(46,341
|
)
|
|
$
|
(5
|
)
|
|
$
|
(697
|
)
|
|
$
|
(411
|
)
|
|
$
|
(47,038
|
)
|
|
$
|
(40,380
|
)
|
Amounts recognized in AOCI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net loss
|
|
—
|
|
|
51,079
|
|
|
50,080
|
|
|
1,788
|
|
|
565
|
|
|
218
|
|
|
50,645
|
|
|
53,085
|
|
||||||||
Total AOCI (not adjusted for applicable tax)
|
|
$
|
—
|
|
|
$
|
51,079
|
|
|
$
|
50,080
|
|
|
$
|
1,788
|
|
|
$
|
565
|
|
|
$
|
218
|
|
|
$
|
50,645
|
|
|
$
|
53,085
|
|
Weighted average assumptions used to determine benefit obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Discount rate
|
|
4.10
|
%
|
|
4.05
|
%
|
|
3.45
|
%
|
|
4.05
|
%
|
|
3.45
|
%
|
|
4.05
|
%
|
|
4.05
|
%
|
|
4.05
|
%
|
||||||||
Rate of compensation increase
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
|
Farmer Bros. Plan
June 30,
|
|
Brewmatic Plan
June 30,
|
|
Hourly Employees’ Plan
June 30,
|
|
Total
|
||||||||||||||||||||||||
($ in thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||
Components of net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest cost
|
|
2,722
|
|
|
5,417
|
|
|
2,339
|
|
|
149
|
|
|
161
|
|
|
163
|
|
|
5,222
|
|
|
5,729
|
|
||||||||
Expected return on plan assets
|
|
(2,767
|
)
|
|
(5,490
|
)
|
|
(2,257
|
)
|
|
(161
|
)
|
|
(222
|
)
|
|
(173
|
)
|
|
(5,246
|
)
|
|
(5,824
|
)
|
||||||||
Amortization of net loss
|
|
710
|
|
|
1,588
|
|
|
796
|
|
|
80
|
|
|
—
|
|
|
6
|
|
|
1,506
|
|
|
1,674
|
|
||||||||
Pension settlement charge
|
|
1,356
|
|
|
—
|
|
|
9,586
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,942
|
|
|
—
|
|
||||||||
Net periodic benefit cost
|
|
$
|
2,021
|
|
|
$
|
1,515
|
|
|
$
|
10,464
|
|
|
$
|
68
|
|
|
$
|
(61
|
)
|
|
$
|
(4
|
)
|
|
$
|
12,424
|
|
|
$
|
1,579
|
|
Other changes recognized in OCI
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net loss
|
|
$
|
7,433
|
|
|
$
|
(6,340
|
)
|
|
$
|
1,413
|
|
|
$
|
(267
|
)
|
|
$
|
347
|
|
|
$
|
(394
|
)
|
|
$
|
9,193
|
|
|
$
|
(7,001
|
)
|
Prior service cost (credit)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Amortization of net loss
|
|
(710
|
)
|
|
(1,588
|
)
|
|
(796
|
)
|
|
(80
|
)
|
|
—
|
|
|
(6
|
)
|
|
(1,506
|
)
|
|
(1,674
|
)
|
||||||||
Pension settlement charge
|
|
(1,356
|
)
|
|
—
|
|
|
(9,586
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,942
|
)
|
|
—
|
|
||||||||
Allocation of net Loss - Plan merger
|
|
(56,446
|
)
|
|
—
|
|
|
56,446
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Net loss due to annuity purchase
|
|
—
|
|
|
—
|
|
|
814
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
814
|
|
|
—
|
|
||||||||
Total recognized in OCI
|
|
$
|
(51,079
|
)
|
|
$
|
(7,928
|
)
|
|
$
|
48,291
|
|
|
$
|
(347
|
)
|
|
$
|
347
|
|
|
$
|
(400
|
)
|
|
$
|
(2,441
|
)
|
|
$
|
(8,675
|
)
|
Total recognized in net periodic benefit cost and OCI
|
|
$
|
(49,058
|
)
|
|
$
|
(6,413
|
)
|
|
$
|
58,755
|
|
|
$
|
(279
|
)
|
|
$
|
286
|
|
|
$
|
(404
|
)
|
|
$
|
9,983
|
|
|
$
|
(7,096
|
)
|
Weighted-average assumptions used to determine net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Discount rate
|
|
4.05
|
%
|
|
3.80
|
%
|
|
4.10
|
%
|
|
3.80
|
%
|
|
4.05
|
%
|
|
3.80
|
%
|
|
4.05
|
%
|
|
3.80
|
%
|
||||||||
Expected long-term return on plan assets
|
|
—
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
|
6.75
|
%
|
||||||||
Rate of compensation increase
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
N/A
|
|
|
|
Farmer Bros. Plan
June 30,
|
|
Brewmatic Plan
June 30,
|
|
Hourly Employees’ Plan
June 30,
|
|
Total
|
||||||||||||||||||||||||
($ in thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||
Comparison of obligations to plan assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Projected benefit obligation
|
|
$
|
—
|
|
|
$
|
137,175
|
|
|
$
|
121,752
|
|
|
$
|
3,724
|
|
|
$
|
4,475
|
|
|
$
|
4,040
|
|
|
$
|
126,227
|
|
|
$
|
144,939
|
|
Accumulated benefit obligation
|
|
$
|
—
|
|
|
$
|
137,175
|
|
|
$
|
121,752
|
|
|
$
|
3,724
|
|
|
$
|
4,475
|
|
|
$
|
4,040
|
|
|
$
|
126,227
|
|
|
$
|
144,939
|
|
Fair value of plan assets at measurement date
|
|
$
|
—
|
|
|
$
|
97,211
|
|
|
$
|
75,411
|
|
|
$
|
3,719
|
|
|
$
|
3,778
|
|
|
$
|
3,629
|
|
|
$
|
79,189
|
|
|
$
|
104,559
|
|
Plan assets by category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity securities
|
|
$
|
—
|
|
|
$
|
63,547
|
|
|
$
|
48,464
|
|
|
$
|
2,431
|
|
|
$
|
2,440
|
|
|
$
|
2,341
|
|
|
$
|
50,904
|
|
|
$
|
68,319
|
|
Debt securities
|
|
—
|
|
|
27,608
|
|
|
22,461
|
|
|
1,056
|
|
|
1,100
|
|
|
1,065
|
|
|
23,561
|
|
|
29,729
|
|
||||||||
Real estate
|
|
—
|
|
|
6,056
|
|
|
4,486
|
|
|
232
|
|
|
238
|
|
|
223
|
|
|
4,724
|
|
|
6,511
|
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
97,211
|
|
|
$
|
75,411
|
|
|
$
|
3,719
|
|
|
$
|
3,778
|
|
|
$
|
3,629
|
|
|
$
|
79,189
|
|
|
$
|
104,559
|
|
Plan assets by category
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Equity securities
|
|
—
|
%
|
|
66
|
%
|
|
64
|
%
|
|
66
|
%
|
|
65
|
%
|
|
65
|
%
|
|
64
|
%
|
|
65
|
%
|
||||||||
Debt securities
|
|
—
|
%
|
|
28
|
%
|
|
30
|
%
|
|
28
|
%
|
|
29
|
%
|
|
29
|
%
|
|
30
|
%
|
|
29
|
%
|
||||||||
Real estate
|
|
—
|
%
|
|
6
|
%
|
|
6
|
%
|
|
6
|
%
|
|
6
|
%
|
|
6
|
%
|
|
6
|
%
|
|
6
|
%
|
||||||||
Total
|
|
—
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
As of June 30, 2019
|
||||||||||||||||||
(In thousands)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Investments measured at NAV
|
||||||||||
Brewmatic Plan
|
|
$
|
75,411
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
75,411
|
|
Hourly Employees’ Plan
|
|
$
|
3,778
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,778
|
|
|
|
As of June 30, 2018
|
||||||||||||||||||
(In thousands)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Investments measured at NAV
|
||||||||||
Farmer Bros. Plan
|
|
$
|
97,211
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
97,211
|
|
Brewmatic Plan
|
|
$
|
3,719
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,719
|
|
Hourly Employees’ Plan
|
|
$
|
3,629
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,629
|
|
|
Fiscal 2020
|
|
U.S. large cap equity securities
|
37.0
|
%
|
U.S. small cap equity securities
|
4.6
|
%
|
International equity securities
|
22.4
|
%
|
Debt securities
|
30.0
|
%
|
Real estate
|
6.0
|
%
|
Total
|
100.0
|
%
|
(In thousands)
|
|
|
Brewmatic Plan
|
|
Hourly Employees’
Plan
|
||||
Year Ending:
|
|
|
|||||||
June 30, 2020
|
|
|
$
|
6,720
|
|
|
$
|
130
|
|
June 30, 2021
|
|
|
$
|
6,550
|
|
|
$
|
150
|
|
June 30, 2022
|
|
|
$
|
6,770
|
|
|
$
|
160
|
|
June 30, 2023
|
|
|
$
|
6,940
|
|
|
$
|
180
|
|
June 30, 2024
|
|
|
$
|
7,060
|
|
|
$
|
190
|
|
June 30, 2025 to June 30, 2029
|
|
|
$
|
35,450
|
|
|
$
|
1,100
|
|
(In thousands)
|
|
WCTPP(1)(2)(3)
|
|
All Other Plans(4)
|
||||
Year Ended:
|
|
|
|
|
||||
June 30, 2019
|
|
$
|
3,634
|
|
|
$
|
39
|
|
June 30, 2018
|
|
$
|
1,605
|
|
|
$
|
35
|
|
June 30, 2017
|
|
$
|
2,114
|
|
|
$
|
39
|
|
(1)
|
Individually significant plan.
|
(2)
|
Less than 5% of total contribution to WCTPP based on WCTPP's FASB Disclosure Statement for the calendar year ended December 31, 2018.
|
(3)
|
The Company guarantees that one hundred seventy-three (173) hours will be contributed upon for all employees who are compensated for all available straight time hours for each calendar month. An additional 6.5% of the basic contribution must be paid for PEER or the Program for Enhanced Early Retirement.
|
(4)
|
Includes one plan that is not individually significant.
|
|
|
Year Ended June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Components of Net Periodic Postretirement Benefit Cost (Credit):
|
|
|
|
|
|
|
||||||
Service cost
|
|
$
|
530
|
|
|
$
|
609
|
|
|
$
|
760
|
|
Interest cost
|
|
887
|
|
|
835
|
|
|
829
|
|
|||
Amortization of net gain
|
|
(834
|
)
|
|
(841
|
)
|
|
(630
|
)
|
|||
Amortization of prior service credit
|
|
(1,757
|
)
|
|
(1,757
|
)
|
|
(1,757
|
)
|
|||
Net periodic postretirement benefit (credit) cost
|
|
$
|
(1,174
|
)
|
|
$
|
(1,154
|
)
|
|
$
|
(798
|
)
|
Amortization Schedule
|
|
|
Transition (Asset) Obligation: The transition (asset) obligations have been fully amortized.
|
Date Established
|
|
Balance at
July 1, 2019
|
|
Annual
Amortization
|
|
Years Remaining
|
|
||||
January 1, 2008
|
|
$
|
(41
|
)
|
|
$
|
41
|
|
|
0.2
|
|
July 1, 2012
|
|
(6,895
|
)
|
|
1,527
|
|
|
4.5
|
|
||
|
|
$
|
(6,936
|
)
|
|
$
|
1,568
|
|
|
|
|
|
|
Retiree Medical Plan
|
|
Death Benefit
|
||||||||||||
|
|
Year Ended June 30,
|
|
Year Ended June 30,
|
||||||||||||
($ in thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Amortization of Net (Gain) Loss:
|
|
|
|
|
|
|
|
|
||||||||
Net (gain) loss as of July 1
|
|
$
|
(7,039
|
)
|
|
$
|
(9,206
|
)
|
|
$
|
1,878
|
|
|
$
|
1,201
|
|
Net (gain) loss subject to amortization
|
|
(7,039
|
)
|
|
(9,206
|
)
|
|
1,878
|
|
|
1,201
|
|
||||
Corridor (10% of greater of APBO or assets)
|
|
1,490
|
|
|
1,280
|
|
|
919
|
|
|
(848
|
)
|
||||
Net (gain) loss in excess of corridor
|
|
$
|
(5,549
|
)
|
|
$
|
(7,926
|
)
|
|
$
|
2,797
|
|
|
$
|
353
|
|
Amortization years
|
|
8.6
|
|
|
8.9
|
|
|
6.5
|
|
|
6.4
|
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Change in Benefit Obligation:
|
|
|
|
|
||||
Projected postretirement benefit obligation at beginning of year
|
|
$
|
21,283
|
|
|
$
|
20,680
|
|
Service cost
|
|
530
|
|
|
609
|
|
||
Interest cost
|
|
887
|
|
|
835
|
|
||
Participant contributions
|
|
605
|
|
|
699
|
|
||
Actuarial gains (losses)
|
|
2,010
|
|
|
(70
|
)
|
||
Benefits paid
|
|
(1,223
|
)
|
|
(1,470
|
)
|
||
Projected postretirement benefit obligation at end of year
|
|
$
|
24,092
|
|
|
$
|
21,283
|
|
|
|
Year Ended June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Change in Plan Assets:
|
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
|
$
|
—
|
|
|
$
|
—
|
|
Employer contributions
|
|
618
|
|
|
771
|
|
||
Participant contributions
|
|
605
|
|
|
699
|
|
||
Benefits paid
|
|
(1,223
|
)
|
|
(1,470
|
)
|
||
Fair value of plan assets at end of year
|
|
$
|
—
|
|
|
$
|
—
|
|
Projected postretirement benefit obligation at end of year
|
|
24,092
|
|
|
21,283
|
|
||
Funded status of plan
|
|
$
|
(24,092
|
)
|
|
$
|
(21,283
|
)
|
|
|
June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Amounts Recognized in the Consolidated Balance Sheets Consist of:
|
|
|
|
|
||||
Current liabilities
|
|
$
|
(1,068
|
)
|
|
$
|
(810
|
)
|
Non-current liabilities
|
|
(23,024
|
)
|
|
(20,473
|
)
|
||
Total
|
|
$
|
(24,092
|
)
|
|
$
|
(21,283
|
)
|
|
|
Year Ended June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Amounts Recognized in AOCI Consist of:
|
|
|
|
|
||||
Net gain
|
|
$
|
(5,160
|
)
|
|
$
|
(8,005
|
)
|
Prior service credit
|
|
(6,936
|
)
|
|
(8,693
|
)
|
||
Total AOCI
|
|
$
|
(12,096
|
)
|
|
$
|
(16,698
|
)
|
|
|
Year Ended June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Other Changes in Plan Assets and Benefit Obligations Recognized in OCI:
|
|
|
|
|
||||
Unrecognized actuarial gains (loss)
|
|
$
|
2,010
|
|
|
$
|
(70
|
)
|
Amortization of net loss
|
|
835
|
|
|
840
|
|
||
Amortization of prior service cost
|
|
1,757
|
|
|
1,757
|
|
||
Total recognized in OCI
|
|
4,602
|
|
|
2,527
|
|
||
Net periodic benefit cost
|
|
(1,174
|
)
|
|
(1,154
|
)
|
||
Total recognized in net periodic benefit credit and OCI
|
|
$
|
3,428
|
|
|
$
|
1,373
|
|
(In thousands)
|
|
||
Estimated Future Benefit Payments:
|
|
||
Year Ending:
|
|
||
June 30, 2020
|
$
|
1,087
|
|
June 30, 2021
|
$
|
1,138
|
|
June 30, 2022
|
$
|
1,173
|
|
June 30, 2023
|
$
|
1,220
|
|
June 30, 2024
|
$
|
1,248
|
|
June 30, 2025 to June 30, 2029
|
$
|
7,116
|
|
|
|
||
Expected Contributions:
|
|
||
June 30, 2020
|
$
|
1,087
|
|
|
|
1-Percentage Point
|
||||||
(In thousands)
|
|
Increase
|
|
Decrease
|
||||
Effect on total of service and interest cost components
|
|
$
|
67
|
|
|
$
|
(58
|
)
|
Effect on accumulated postretirement benefit obligation
|
|
$
|
814
|
|
|
$
|
(745
|
)
|
|
|
As of June 30,
|
||||
|
|
2019
|
|
2018
|
|
2017
|
Loan amount (in thousands)
|
|
$—
|
|
$2,145
|
|
$4,289
|
|
|
As of June 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Allocated shares
|
|
1,393,530
|
|
|
1,502,323
|
|
||
Committed to be released shares
|
|
—
|
|
|
73,826
|
|
||
Unallocated shares
|
|
—
|
|
|
72,114
|
|
||
Total ESOP shares
|
|
1,393,530
|
|
|
1,648,263
|
|
||
|
|
|
|
|
||||
(In thousands)
|
|
|
|
|
||||
Fair value of ESOP shares
|
|
$
|
22,812
|
|
|
$
|
50,354
|
|
|
|
Year Ended June 30,
|
||||||||||
|
|
2019
|
|
2018
|
|
2017
|
||||||
Weighted average fair value of NQOs
|
|
$
|
7.78
|
|
|
$
|
10.41
|
|
|
$
|
—
|
|
Risk-free interest rate
|
|
3.0
|
%
|
|
2.0
|
%
|
|
—
|
%
|
|||
Dividend yield
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|||
Average expected term
|
|
4.6 years
|
|
|
4.6 years
|
|
|
0
|
|
|||
Expected stock price volatility
|
|
29.6
|
%
|
|
35.4
|
%
|
|
—
|
%
|
Outstanding NQOs:
|
|
Number
of NQOs
|
|
Weighted
Average
Exercise
Price ($)
|
|
Weighted
Average
Remaining
Life
(Years)
|
|
Aggregate
Intrinsic
Value
($ in thousands)
|
||
Outstanding at June 30, 2018
|
|
161,324
|
|
|
26.82
|
|
5.1
|
|
741
|
|
Granted
|
|
154,263
|
|
|
25.04
|
|
—
|
|
—
|
|
Exercised
|
|
(28,798
|
)
|
|
11.32
|
|
—
|
|
466
|
|
Forfeited
|
|
(87,861
|
)
|
|
27.53
|
|
—
|
|
—
|
|
Expired
|
|
(879
|
)
|
|
31.70
|
|
—
|
|
—
|
|
Outstanding at June 30, 2019
|
|
198,049
|
|
|
27.35
|
|
5.25
|
|
40
|
|
Exercisable at June 30, 2019
|
|
50,229
|
|
|
27.72
|
|
2.93
|
|
40
|
|
|
|
Year Ended June 30,
|
||
|
|
2017
|
||
Weighted average fair value of PNQs
|
|
$
|
11.42
|
|
Risk-free interest rate
|
|
1.5
|
%
|
|
Dividend yield
|
|
—
|
%
|
|
Average expected term
|
|
4.9 years
|
|
|
Expected stock price volatility
|
|
37.7
|
%
|
Outstanding PNQs:
|
|
Number
of
PNQs
|
|
Weighted
Average
Exercise
Price ($)
|
|
Weighted
Average
Remaining
Life
(Years)
|
|
Aggregate
Intrinsic
Value
($ in
thousands)
|
||
Outstanding at June 30, 2018
|
|
300,708
|
|
|
27.08
|
|
4.0
|
|
1,207
|
|
Granted
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Exercised
|
|
(5,806
|
)
|
|
22.70
|
|
—
|
|
—
|
|
Forfeited
|
|
(50,451
|
)
|
|
31.45
|
|
—
|
|
—
|
|
Expired
|
|
(14,490
|
)
|
|
27.50
|
|
—
|
|
—
|
|
Outstanding at June 30, 2019
|
|
229,961
|
|
|
26.21
|
|
1.23
|
|
—
|
|
Exercisable at June 30, 2019
|
|
203,021
|
|
|
25.48
|
|
0.86
|
|
—
|
|
Outstanding and Nonvested Restricted Stock Awards:
|
|
Shares
Awarded
|
|
Weighted
Average
Grant Date
Fair Value
($)
|
|
Outstanding at June 30, 2018
|
|
14,958
|
|
|
33.48
|
Granted
|
|
30,352
|
|
|
20.8
|
Exercised/Released
|
|
(13,254
|
)
|
|
33.7
|
Cancelled/Forfeited
|
|
—
|
|
|
—
|
Outstanding and nonvested at June 30, 2019
|
|
32,056
|
|
|
21.1
|
Outstanding and Nonvested PBRSUs:
|
|
PBRSUs
Awarded
|
|
Weighted
Average
Grant Date
Fair Value
($)
|
|
Outstanding and nonvested at June 30, 2018
|
|
35,732
|
|
|
31.70
|
Granted(1)
|
|
47,928
|
|
|
25.04
|
Vested/Released
|
|
—
|
|
|
—
|
Cancelled/Forfeited
|
|
(32,423
|
)
|
|
28.19
|
Outstanding and nonvested at June 30, 2019
|
|
51,237
|
|
|
27.69
|
Expected to vest at June 30, 2019
|
|
—
|
|
|
—
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Accrued postretirement benefits
|
|
$
|
1,068
|
|
|
$
|
810
|
|
Accrued workers’ compensation liabilities
|
|
1,495
|
|
|
1,698
|
|
||
Short-term pension liabilities(1)
|
|
—
|
|
|
3,761
|
|
||
Earnout payable(2)
|
|
1,000
|
|
|
600
|
|
||
Working capital dispute payable(3)
|
|
354
|
|
|
—
|
|
||
Other(4)
|
|
3,392
|
|
|
3,790
|
|
||
Other current liabilities
|
|
$
|
7,309
|
|
|
$
|
10,659
|
|
|
|
As of June 30,
|
||||||
(In thousands)
|
|
2019
|
|
2018
|
||||
Long-term obligations under capital leases
|
|
$
|
(2
|
)
|
|
$
|
58
|
|
Derivative liabilities—noncurrent
|
|
1,612
|
|
|
386
|
|
||
Multiemployer Plan Holdback—Boyd Coffee (1)
|
|
—
|
|
|
1,056
|
|
||
Cumulative preferred dividends, undeclared and unpaid—noncurrent
|
|
618
|
|
|
312
|
|
||
Deferred income taxes (2)
|
|
1,795
|
|
|
—
|
|
||
Other long-term liabilities
|
|
$
|
4,023
|
|
|
$
|
1,812
|
|
|
|
For the Years Ended June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(1,774
|
)
|
|
$
|
101
|
|
|
$
|
132
|
|
State
|
|
231
|
|
|
56
|
|
|
340
|
|
|||
Total current income tax (benefit) expense
|
|
(1,543
|
)
|
|
157
|
|
|
472
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
30,618
|
|
|
17,090
|
|
|
12,120
|
|
|||
State
|
|
11,036
|
|
|
65
|
|
|
2,223
|
|
|||
Total deferred income tax expense
|
|
41,654
|
|
|
17,155
|
|
|
14,343
|
|
|||
Income tax expense
|
|
$
|
40,111
|
|
|
$
|
17,312
|
|
|
$
|
14,815
|
|
|
|
For the Years Ended June 30,
|
||||||||||
(In thousands)
|
|
2019
|
|
2018
|
|
|
2017
|
|||||
Statutory tax rate
|
|
21
|
%
|
|
28
|
%
|
|
35
|
%
|
|||
Income tax (benefit) expense at statutory rate
|
|
$
|
(7,032
|
)
|
|
$
|
(272
|
)
|
|
$
|
13,078
|
|
State income tax (benefit) expense, net of federal tax benefit
|
|
(1,295
|
)
|
|
12
|
|
|
1,707
|
|
|||
Dividend income exclusion
|
|
—
|
|
|
—
|
|
|
(134
|
)
|
|||
Valuation allowance
|
|
50,123
|
|
|
283
|
|
|
(14
|
)
|
|||
Change in tax rate
|
|
124
|
|
|
18,022
|
|
|
(54
|
)
|
|||
Retiree life insurance
|
|
—
|
|
|
19
|
|
|
1
|
|
|||
Other (net)
|
|
(1,809
|
)
|
|
(752
|
)
|
|
231
|
|
|||
Income tax expense
|
|
$
|
40,111
|
|
|
$
|
17,312
|
|
|
$
|
14,815
|
|
|
|
|
|
|
|
|
|
|
As of June 30,
|
|||||||
(In thousands)
|
|
2019
|
|
2018
|
|
||||
Deferred tax assets:
|
|
|
|
|
|
||||
Postretirement benefits
|
|
$
|
20,775
|
|
|
$
|
18,862
|
|
|
Accrued liabilities
|
|
5,042
|
|
|
4,754
|
|
|
||
Net operating loss carryforwards
|
|
37,768
|
|
|
32,552
|
|
|
||
Other
|
|
5,950
|
|
|
6,728
|
|
|
||
Total deferred tax assets
|
|
69,535
|
|
|
62,896
|
|
|
||
Deferred tax liabilities:
|
|
|
|
|
|
||||
Fixed assets
|
|
(15,562
|
)
|
|
(16,156
|
)
|
|
||
Other
|
|
(3,749
|
)
|
|
(5,536
|
)
|
|
||
Total deferred tax liabilities
|
|
(19,311
|
)
|
|
(21,692
|
)
|
|
||
Valuation allowance
|
|
(52,019
|
)
|
|
(1,896
|
)
|
|
||
Net deferred tax assets (liabilities)
|
|
$
|
(1,795
|
)
|
|
$
|
39,308
|
|
|
|
|
For the Years Ended June 30,
|
||||||||||
(In thousands, except share and per share amounts)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Undistributed net (loss) income available to common stockholders
|
|
$
|
(74,054
|
)
|
|
$
|
(18,652
|
)
|
|
$
|
22,524
|
|
Undistributed net (loss) income available to nonvested restricted stockholders and holders of convertible preferred stock
|
|
(76
|
)
|
|
(17
|
)
|
|
27
|
|
|||
Net (loss) income available to common stockholders—basic
|
|
$
|
(74,130
|
)
|
|
$
|
(18,669
|
)
|
|
$
|
22,551
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding—basic
|
|
16,996,354
|
|
|
16,815,020
|
|
|
16,668,745
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Shares issuable under stock options
|
|
—
|
|
|
—
|
|
|
117,007
|
|
|||
Weighted average common shares outstanding—diluted
|
|
16,996,354
|
|
|
16,815,020
|
|
|
16,785,752
|
|
|||
Net (loss) income per common share available to common stockholders—basic
|
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.35
|
|
Net (loss) income per common share available to common stockholders—diluted
|
|
$
|
(4.36
|
)
|
|
$
|
(1.11
|
)
|
|
$
|
1.34
|
|
|
|
For the Years Ended June 30,
|
|||||||
(In thousands)
|
|
2019
|
|
2018
|
|
2017
|
|||
Shares issuable under stock options
|
|
—
|
|
|
462,032
|
|
|
24,671
|
|
Shares issuable under convertible preferred stock
|
|
407,734
|
|
|
393,769
|
|
|
—
|
|
Shares issuable under PBRSUs
|
|
—
|
|
|
35,732
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
(In thousands, except share and per share amounts)
|
|
|
|
|
|
|
|||||||||||||
Shares Authorized
|
|
Shares Issued and Outstanding
|
|
Stated Value per Share
|
|
Carrying Value
|
|
Cumulative Preferred Dividends, Undeclared and Unpaid
|
|
Liquidation Preference
|
|||||||||
21,000
|
|
|
14,700
|
|
|
$
|
1,063
|
|
|
15,624
|
|
|
$
|
924
|
|
|
$
|
15,624
|
|
(In thousands)
|
|
Operating
Lease Obligations |
||
Year Ended June 30,
|
|
|
||
2020
|
|
$
|
4,434
|
|
2021
|
|
3,238
|
|
|
2022
|
|
2,472
|
|
|
2023
|
|
2,131
|
|
|
2024
|
|
2,025
|
|
|
Thereafter
|
|
4,389
|
|
|
Total
|
|
$
|
18,689
|
|
(In thousands)
|
|
Capital
Lease Obligations |
||
Year Ended June 30,
|
|
|
||
2020
|
|
$
|
36
|
|
2021
|
|
1
|
|
|
Total minimum lease payments
|
|
37
|
|
|
Less: imputed interest
(0.82% to 10.66%) |
|
(2
|
)
|
|
Present value of future minimum lease payments
|
|
35
|
|
|
Less: current portion
|
|
34
|
|
|
Long-term capital lease obligations
|
|
$
|
1
|
|
|
|
For the Years Ended June 30,
|
|||||||||||||||||||
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
(In thousands)
|
|
$
|
|
% of total
|
|
$
|
|
% of total
|
|
$
|
|
% of total
|
|||||||||
Net Sales by Product Category:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Coffee (Roasted)
|
|
$
|
378,583
|
|
|
63.5
|
%
|
|
$
|
379,951
|
|
|
62.6
|
%
|
|
$
|
339,358
|
|
|
62.7
|
%
|
Coffee (Frozen Liquid)
|
|
34,541
|
|
|
5.8
|
%
|
|
34,794
|
|
|
5.7
|
%
|
|
32,827
|
|
|
6.1
|
%
|
|||
Tea (Iced & Hot)
|
|
33,109
|
|
|
5.6
|
%
|
|
32,477
|
|
|
5.4
|
%
|
|
29,256
|
|
|
5.4
|
%
|
|||
Culinary
|
|
64,100
|
|
|
10.8
|
%
|
|
64,432
|
|
|
10.6
|
%
|
|
55,592
|
|
|
10.3
|
%
|
|||
Spice
|
|
24,101
|
|
|
4.0
|
%
|
|
25,150
|
|
|
4.2
|
%
|
|
24,895
|
|
|
4.6
|
%
|
|||
Other beverages(1)
|
|
58,367
|
|
|
9.8
|
%
|
|
66,699
|
|
|
11.0
|
%
|
|
56,653
|
|
|
10.4
|
%
|
|||
Net sales by product category
|
|
592,801
|
|
|
99.5
|
%
|
|
603,503
|
|
|
99.5
|
%
|
|
538,581
|
|
|
99.5
|
%
|
|||
Fuel surcharge
|
|
3,141
|
|
|
0.5
|
%
|
|
3,041
|
|
|
0.5
|
%
|
|
2,919
|
|
|
0.5
|
%
|
|||
Net sales
|
|
$
|
595,942
|
|
|
100.0
|
%
|
|
$
|
606,544
|
|
|
100.0
|
%
|
|
$
|
541,500
|
|
|
100.0
|
%
|
|
|
For The Three Months Ended
|
||||||||||||||
|
|
September 30,
2018 |
|
December 31,
2018 |
|
March 31,
2019 |
|
June 30,
2019 |
||||||||
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
||||||||
Net sales
|
|
$
|
147,440
|
|
|
$
|
159,773
|
|
|
$
|
146,679
|
|
|
$
|
142,050
|
|
Cost of goods sold
|
|
$
|
99,205
|
|
|
$
|
106,529
|
|
|
$
|
106,779
|
|
|
$
|
104,327
|
|
Gross profit
|
|
$
|
48,235
|
|
|
$
|
53,244
|
|
|
$
|
39,900
|
|
|
$
|
37,723
|
|
Selling expenses
|
|
$
|
37,310
|
|
|
$
|
39,591
|
|
|
$
|
34,422
|
|
|
$
|
28,324
|
|
(Loss) income from operations
|
|
$
|
(2,078
|
)
|
|
$
|
502
|
|
|
$
|
(6,102
|
)
|
|
$
|
(7,024
|
)
|
Net loss
|
|
$
|
(2,986
|
)
|
|
$
|
(10,100
|
)
|
|
$
|
(51,749
|
)
|
|
$
|
(8,760
|
)
|
Net loss available to common stockholders per common share—basic
|
|
$
|
(0.18
|
)
|
|
$
|
(0.60
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
(0.52
|
)
|
Net loss available to common stockholders per common share—diluted
|
|
$
|
(0.18
|
)
|
|
$
|
(0.60
|
)
|
|
$
|
(3.05
|
)
|
|
$
|
(0.52
|
)
|
|
|
For The Three Months Ended
|
||||||||||||||||||||||||||||||
|
|
September 30,
2017 |
|
December 31,
2017 |
|
March 31,
2018 |
|
June 30,
2018 |
||||||||||||||||||||||||
|
|
As Previously Reported
|
|
Retrospectively Adjusted
|
|
As Previously Reported
|
|
Retrospectively Adjusted
|
|
As Previously Reported
|
|
Retrospectively Adjusted
|
|
As Previously Reported
|
|
Retrospectively Adjusted
|
||||||||||||||||
(In thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net sales
|
|
$
|
131,713
|
|
|
$
|
131,713
|
|
|
$
|
167,366
|
|
|
$
|
167,366
|
|
|
$
|
157,927
|
|
|
$
|
157,927
|
|
|
$
|
149,538
|
|
|
$
|
149,538
|
|
Cost of goods sold
|
|
$
|
85,672
|
|
|
$
|
85,630
|
|
|
$
|
111,175
|
|
|
$
|
111,089
|
|
|
$
|
105,716
|
|
|
$
|
105,629
|
|
|
$
|
96,939
|
|
|
$
|
96,806
|
|
Gross profit
|
|
$
|
46,041
|
|
|
$
|
46,083
|
|
|
$
|
56,191
|
|
|
$
|
56,277
|
|
|
$
|
52,211
|
|
|
$
|
52,298
|
|
|
$
|
52,599
|
|
|
$
|
52,732
|
|
Selling expenses
|
|
$
|
32,828
|
|
|
$
|
32,856
|
|
|
$
|
42,414
|
|
|
$
|
42,127
|
|
|
$
|
38,041
|
|
|
$
|
37,754
|
|
|
$
|
41,256
|
|
|
$
|
40,655
|
|
Income from operations
|
|
$
|
1,862
|
|
|
$
|
1,845
|
|
|
$
|
28
|
|
|
$
|
10
|
|
|
$
|
(2,767
|
)
|
|
$
|
(2,785
|
)
|
|
$
|
2,001
|
|
|
$
|
1,984
|
|
Net income (loss)
|
|
$
|
840
|
|
|
$
|
841
|
|
|
$
|
(17,060
|
)
|
|
$
|
(17,060
|
)
|
|
$
|
(2,193
|
)
|
|
$
|
(2,193
|
)
|
|
$
|
133
|
|
|
$
|
133
|
|
Net income (loss) available to common stockholders per common share—basic
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
(1.03
|
)
|
|
$
|
(1.03
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Net income (loss) available to common stockholders per common share—diluted
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
(1.03
|
)
|
|
$
|
(1.03
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
/s/ Jennifer H. Brown
|
|
Name: Jennifer H. Brown
|
|
Title: Corporate Secretary
|
|
/s/ CHRISTOPHER P. MOTTERN
|
Christopher P. Mottern
Interim President and Chief Executive Officer (chief executive officer) |
|
/S/ DAVID G. ROBSON
|
David G. Robson
Treasurer and Chief Financial Officer
(principal financial and accounting officer)
|
|
/s/ CHRISTOPHER P. MOTTERN
|
Christopher P. Mottern
Interim President and Chief Executive Officer (chief executive officer) |
|
/S/ DAVID G. ROBSON
|
David G. Robson
Treasurer and Chief Financial Officer
(principal financial and accounting officer)
|