Quarterly report pursuant to Section 13 or 15(d)

Restatements (Tables)

v3.8.0.1
Restatements (Tables)
 6 Months Ended
Jun. 30, 2017
Restatements [Abstract]  
Summary of changes made to restatement

 

LEGACY EDUCATION ALLIANCE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

 

    As Previously Reported June 30,     Restatement     As Restated June 30,     December 31,  
    2017     Adjustments     2017     2016  
ASSETS                        
Current assets:                        
Cash and cash equivalents     4,705       -       4,705       1,711  
Restricted cash     3,403       -       3,403       3,148  
Deferred course expenses     9,711       (247 )     9,464       9,067  
Prepaid expenses and other current assets     4,083       -       4,083       3,458  
Inventory     373       -       373       348  
Total current assets     22,275       (247 )     22,028       17,732  
Property and equipment, net     1,170       -       1,170       1,130  
Deferred tax asset, net     1,563       (27 )     1,536       1,295  
Other assets     305       -       305       207  
Total assets     25,313       (274 )     25,039       20,364  
LIABILITIES AND STOCKHOLDERS’ DEFICIT                                
Current liabilities:                                
Accounts payable     3,049       -       3,049       3,344  
Royalties payable     376       -       376       175  
Accrued course expenses     1,840       -       1,840       1,082  
Accrued salaries, wages and benefits     1,127       -       1,127       840  
Other accrued expenses     2,583       -       2,583       2,052  
Long-term debt, current portion     11       -       11       11  
Deferred revenue, current portion     57,397       (578 )     56,819       54,389  
Total current liabilities     66,383       (578 )     65,805       61,893  
Long-term debt, net of current portion     26       -       26       31  
Deferred revenue, net of current portion     555       -       555       235  
Other liabilities     479       (118 )     361       379  
Total liabilities     67,443       (696 )     66,747       62,538  
Commitments and contingencies (Note 10)                                
Stockholders’ deficit:                                
Preferred stock, $0.0001 par value, 20,000,000 shares authorized, none issued     -       -       -       -  
Common stock, $0.0001 par value, 200,000,000 shares authorized, 23,030,929 and 22,630,927 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively     2       -       2       2  
Additional paid-in capital     11,180       -       11,180       11,073  
Cumulative foreign currency translation adjustment     1,390       -       1,390       2,668  
Accumulated deficit     (54,702 )     422       (54,280 )     (55,917 )
Total stockholders’ deficit     (42,130 )     422       (41,708 )     (42,174 )
Total liabilities and stockholders’ deficit     25,313       (274 )     25,039       20,364  

 

LEGACY EDUCATION ALLIANCE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands, except share data)

 

    As Previously Reported Three months ended Jun 30, 2017     Restatement Adjustments     As Restated Three months ended Jun 30,
2017		     Three months ended Jun 30,
2016		     As Previously Reported Three months ended Jun 30, 2017     Restatement Adjustments     As Restated Three months ended Jun 30,
2017		     Three months ended Jun 30,
2016		  
                                                 
Revenue   $ 24,780     $ 1,428     $ 26,208     $ 23,375     $ 47,595     $ 578     $ 48,173     $ 46,113  
Operating costs and expenses:                                                                
Direct course expenses     13,007       213       13,220       12,584       25,836       247       26,083       24,238  
Advertising and sales expenses     5,131       0       5,131       5,322       9,722       0       9,722       10,589  
Royalty expenses     1,639       0       1,639       1,070       2,532       0       2,532       2,043  
General and administrative expenses     4,231       0       4,231       3,685       8,572       0       8,572       7,744  
Total operating costs and expenses     24,008       213       24,221       22,661       46,662       247       46,909       44,614  
Income from operations     772       1,215       1,987       714       933       331       1,264       1,499  
Other income (expense):                                                                
Interest income (expense), net     (2 )     0       (2 )     1       (5 )     0       (5 )     (2 )
Other income, net     69       -       69       319       152       -       152       140  
Total other income (expense), net     67       0       67       320       147       0       147       138  
Income before income taxes     839       1,215       2,054       1,034       1,080       331       1,411       1,637  
Income tax benefit/(expense)     156       (263 )     (107 )     (9 )     135       91       226       (19 )
Net income   $ 995     $ 952     $ 1,947     $ 1,025     $ 1,215     $ 422     $ 1,637     $ 1,618  
                                                                 
Basic earnings per common share   $ 0.04     $ 0.05     $ 0.09     $ 0.05     $ 0.05     $ 0.02     $ 0.07     $ 0.08  
Diluted earnings per common share   $ 0.04     $ 0.04     $ 0.08     $ 0.04     $ 0.05     $ 0.02     $ 0.07     $ 0.07  
                                                                 
Basic weighted average common shares outstanding     21,284       0       21,284       20,961       21,284       0       21,284       20,961  
Diluted weighted average common shares outstanding     22,763       0       22,763       21,846       22,697       0       22,697       21,846  
                                                                 
Comprehensive income/(loss):                                                                
Net income   $ 995     $ 952     $ 1,947     $ 1,025     $ 1,215     $ 422     $ 1,637     $ 1,618  
Foreign currency translation adjustments, net of tax of $0     (980 )     -       (980 )     1,474       (1,278 )     -       (1,278 )     1,959  
Total comprehensive income (loss)   $ 15     $ 952     $ 967     $ 2,499     $ (63 )   $ 422     $ 359     $ 3,577  


LEGACY EDUCATION ALLIANCE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT

(Unaudited)

(In thousands)

 

    Common stock     Additional paid-in     Cumulative foreign currency translation     Accumulated     Total stockholders’  
    Shares     Amount     capital     adjustment     deficit     deficit  
Balance at December 31, 2016     22,631     $ 2     $ 11,073     $ 2,668     $ (55,917 )   $ (42,174 )
Share-based compensation expense     —       —       107       —       —       107  
Issuance of common stock     400       —       —       —       —       —  
Foreign currency translation adjustment, net of tax of $0     —       —       —       (1,278 )     —       (1,278 )
Net Income     —       —       —       —       1,637       1,637  
Balance at June 30, 2017 (Restated)     23,031     $ 2     $ 11,180     $ 1,390     $ (54,280 )   $ (41,708 )


LEGACY EDUCATION ALLIANCE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW

(Unaudited)

(In thousands)

 

    As Previously Reported Six Months Ended June 30,
2017		     Restatement Adjustments     As Restated Six Months Ended June 30,
2017		     Six Months Ended June 30,
2016 		 
CASH FLOWS FROM OPERATING ACTIVITIES                        
Net income   $ 1,215     $ 422     $ 1,637     $ 1,618  
Adjustments to reconcile net income to net cash provided by (used in) operating activities:                                
Depreciation and amortization     65       -       65       78  
Gain on change in fair value of derivatives     (87 )     -       (87 )     (3 )
Share-based compensation     107       -       107       74  
Deferred income taxes     (264 )     (91 )     (355 )     (1 )
Changes in operating assets and liabilities:                                
Restricted cash     (186 )     -       (186 )     (721 )
Deferred course expenses     (487 )     247       (240 )     (161 )
Prepaid expenses and other receivable     (539 )     -       (539 )     (447 )
Inventory     (18 )     -       (18 )     180  
Other assets     (27 )     —       (27 )     (3 )
Accounts payable-trade     (388 )     -       (388 )     2,153  
Royalties payable     201       -       201       103  
Accrued course expenses     725       -       725       390  
Accrued salaries, wages and benefits     280       -       280       (618 )
Other accrued expenses     656       -       656       (1,124 )
Deferred revenue     1,832       (578 )     1,254       (2,089 )
Other liabilities     100       -       100       —  
Net cash provided by (used in) operating activities     3,185       0       3,185       (571 )
CASH FLOWS FROM INVESTING ACTIVITIES                                
Purchases of property and equipment     (103 )     -       (103 )     (37 )
Net cash used in investing activities     (103 )     -       (103 )     (37 )
CASH FLOWS FROM FINANCING ACTIVITIES                                
Principal payments on debt     (5 )     -       (5 )     (5 )
Net cash used in financing activities     (5 )     -       (5 )     (5 )
Effect of exchange rate differences on cash     (83 )     -       (83 )     703  
Net increase in cash and cash equivalents     2,994       0       2,994       90  
Cash and cash equivalents, beginning of period   $ 1,711     $ -     $ 1,711     $ 4,881  
Cash and cash equivalents, end of period   $ 4,705     $ 0     $ 4,705     $ 4,971  
                                 
Supplemental disclosures:                                
Cash paid during the period for interest   $ 5     $ -     $ 5     $ 5  
Cash paid during the period for income taxes, net of refunds received   $ 30     $ 2     $ 32     $ 34