Resources Connection, Inc. (the \u201cCompany\u201d), a Delaware corporation, was incorporated on November\u00a016, 1998. The Company\u2019s operating entities provide services primarily under the name Resources Global Professionals. Resources Global Professionals is a global consulting firm helping clients match the right professional talent needed to tackle change and transformational initiatives. As a next-generation human capital partner for its clients, the Company specializes in solving today\u2019s most pressing business problems across the enterprise in the areas of transactions, regulations, and transformations. The Company\u2019s principal markets of operations are the United States (\u201cU.S.\u201d), Europe, Asia Pacific, Mexico and Canada.
The Company\u2019s fiscal year consists of 52 or 53\u00a0weeks, ending on the Saturday in May closest to May\u00a031. Fiscal years 2019 and 2021 consisted of four 13-week quarters and included a total of 52 weeks of activity in the fiscal year. For fiscal year 2020, the first three quarters consisted of 13 weeks each and the fourth quarter consisted of 14 weeks, with a total of 53 weeks of activity in the fiscal year. "}]},{"name":"rpt:f-381","factDimensions":{"xbrl:concept":"us-gaap:FiscalPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"The Company\u2019s fiscal year consists of 52 or 53\u00a0weeks, ending on the Saturday in May closest to May\u00a031. Fiscal years 2019 and 2021 consisted of four 13-week quarters and included a total of 52 weeks of activity in the fiscal year. For fiscal year 2020, the first three quarters consisted of 13 weeks each and the fourth quarter consisted of 14 weeks, with a total of 53 weeks of activity in the fiscal year. "}]},{"name":"rpt:f-382","factDimensions":{"xbrl:concept":"us-gaap:FiscalPeriodDuration","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MinimumMember"},"factValues":[{"value":"P364D"}]},{"name":"rpt:f-383","factDimensions":{"xbrl:concept":"us-gaap:FiscalPeriodDuration","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MaximumMember"},"factValues":[{"value":"P371D"}]},{"name":"rpt:f-384","factDimensions":{"xbrl:concept":"us-gaap:SignificantAccountingPoliciesTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"2.\u00a0Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
The Consolidated Financial Statements of the Company (\u201cfinancial statements\u201d) have been prepared in conformity with accounting principles generally accepted in the U.S.\u00a0(\u201cGAAP\u201d) and the rules of the Securities and Exchange Commission (\u201cSEC\u201d). The financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
Reporting Segments
Effective in the second quarter of fiscal 2021, the Company revised its historical one segment position and identified the following new operating segments to align with changes made in its internal management structure and its reporting structure of financial information used to assess performance and allocate resources:
\uf0b7RGP \u2013 a global business consulting practice which operates primarily under the RGP brand and focuses on project consulting and professional staffing services in areas such as finance and accounting, business strategy and transformation, risk and compliance, and technology and digital;
\uf0b7taskforce \u2013 a German professional services firm that operates under the taskforce brand. It utilizes a distinct independent contractor/partner business model and infrastructure and focuses on providing senior interim management and project management services to middle market clients in the German market;
\uf0b7Sitrick \u2013 a crisis communications and public relations firm which operates under the Sitrick brand, providing corporate, financial, transactional and crisis communication and management services.
Each of these three segments reports through a separate management team to the Company\u2019s Chief Executive Officer, who is designated as the Chief Operating Decision Maker for segment reporting purposes. RGP is the Company\u2019s only reportable segment. taskforce and Sitrick do not individually meet the quantitative thresholds to qualify as reportable segments. Therefore, they are combined and disclosed as Other Segments. Each of these segments represents a reporting unit for the purposes of assessing goodwill for impairment. All prior-period comparative segment information was recast to reflect the current reportable segments in accordance with Accounting Standards Codification (\u201cASC\u201d) 280, Segment Reporting. The change in segment reporting did not impact the Company\u2019s consolidated financial statements.
Reclassifications
Certain prior period amounts have been reclassified to conform to current period presentation. These reclassifications had no effect on previously reported totals for assets, liabilities, stockholders\u2019 equity, cash flows or net income.
Risks and Uncertainties
The Pandemic has adversely impacted the Company\u2019 business in the past year including, among other things, reducing demand for or delaying client decisions to procure its services. In response to the Pandemic, the Company evolved its operating model to be more virtual and borderless. The move to virtual and borderless talent helped the Company manage supply and demand more efficiently,
which resulted in faster revenue generation and reduced consultant turnover, mitigating the negative impact of the Pandemic. During fiscal 2021, the Company\u2019s revenue declined 10.5% compared to fiscal 2020, as the Pandemic started to impact the Company on a worldwide basis in the fourth quarter of fiscal 2020. The Company reached a trough in revenue during the first quarter of fiscal 2021 and has since experienced a steady recovery in each sequential quarter thereafter. By the fourth quarter of fiscal 2021, the revenue decline compared to the prior year quarter improved to 3.5% year over year, and revenue in the fourth quarter of fiscal 2021 exceeded the first quarter of fiscal 2021 by 16.9%.
In order to strengthen the Company\u2019s liquidity during the Pandemic, the Company took proactive measures to increase its cash on hand including, but not limited to, borrowing $39 million under its $120.0\u00a0million secured revolving credit facility with Bank of America (the \u201cFacility\u201d) in the fourth quarter of fiscal 2020, reducing discretionary spending, and focusing on receivables collections efforts. The Company also elected to defer the deposit of its employer portion of social security taxes from April to December 2020, as provided for under the Coronavirus Aid, Relief, and Economic Security Act (\u201cCARES Act\u201d). Due to the focused efforts to contain costs and manage working capital, the Company\u2019s cash flows from operations enabled it to repay a total of $45 million on its borrowings during fiscal 2021 and another $10 million subsequently on June 9, 2021. In addition, the Company repaid a total of $6.3 million in deferred deposit of the employer portion of social security taxes prior to May 29, 2021.
As of May 29, 2021, the Company had cash and cash equivalents of $74.4 million, and additional availability under the Facility of $75.7 million. Given its balance sheet and liquidity position, management believes that the Company has the financial flexibility and resources needed to operate in the current uncertain economic environment. However, if global economic conditions worsen as a result of the Pandemic, it could materially impact the Company\u2019s liquidity position and capital needs.
The full extent to which the Pandemic impacts the Company\u2019 business and financial results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the virus and the actions to contain its impact, the impacts of new variants of the virus, and the timing, distribution, efficacy and public acceptance of vaccines and other treatments for COVID-19.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although management believes these estimates and assumptions are adequate, actual results could differ from the estimates and assumptions used.
Revenue Recognition
The Company generates substantially all of its revenues from providing professional consulting services to its clients. Revenues are recognized when control of the promised service is transferred to the Company\u2019s clients, in an amount that reflects the consideration expected in exchange for the services. Revenue is recorded net of sales or other transaction taxes collected from clients and remitted to taxing authorities. Revenues from contracts are recognized over time, based on hours worked by the Company\u2019s professionals. The performance of the agreed-to service over time is the single performance obligation for revenues. Certain clients may receive discounts (for example, volume discounts or rebates) to the amounts billed. These discounts or rebates are considered variable consideration. Management evaluates the facts and circumstances of each contract and client relationship to estimate the variable consideration assessing the most likely amount to recognize and considering management\u2019s expectation of the volume of services to be provided over the applicable period. Rebates are the largest component of variable consideration and are estimated using the most likely amount method, contracts terms and estimates of revenue. Revenues are recognized net of variable consideration to the extent that it is probable that a significant reversal of revenues will not occur in subsequent periods.
On a limited basis, the Company may have fixed-price contracts, for which revenues are recognized over time using the input method based on time incurred as a proportion of estimated total time. Time incurred represents work performed, which corresponds with, and therefore best depicts, the transfer of control to the client. Management uses significant judgments when estimating the total hours expected to complete the contract performance obligation. It is possible that updated estimates for consulting engagements may vary from initial estimates with such updates being recognized in the period of determination. Depending on the timing of billings and services rendered, the Company accrues or defers revenue as appropriate.
\u00a0
The Company recognizes revenues primarily on a gross basis as it acts as a principal for primarily all of its revenue transactions. The Company has concluded that gross reporting is appropriate because it controls the services before they are transferred to the customers. The Company a) has the risk of identifying and hiring qualified consultants; b) has the discretion to select the consultants and establish the price and responsibilities for services to be provided; c) is primarily responsible for fulfilling the promise to provide the service to the customer; and d) bears the risk for services provided that are not fully paid for by clients. The Company recognizes all reimbursements received from clients for \u201cout-of-pocket\u201d expenses as revenue and all such expenses as direct cost of services.
Reimbursements received from clients were $3.2 million, $9.4\u00a0million and $12.3\u00a0million for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively.
Commissions earned by the Company\u2019 sales professionals are considered incremental and recoverable costs of obtaining a contract with a customer. The Company elected to apply the practical expedient to expense sales commissions as incurred as the expected amortization period is one year or less. Sales commissions are recorded in selling, general and administrative expenses in the Company\u2019s Consolidated Statement of Operations. During the years ended May 29, 2021, May 30, 2020, and May 25, 2019, sales commission expense was $5.9 million, $6.3 million, and $6.7 million, respectively.
The Company\u2019s clients are contractually obligated to pay the Company for all hours billed. The Company invoices the majority of its clients on a weekly basis or, in certain circumstances, on a bi-weekly or monthly basis, and its typical arrangement of payment is due within 30 days. To a much lesser extent, in certain circumstances, the Company also earns revenue if one of its consultants is hired by, or if the Company places an outside candidate with, its client. Conversion fees or permanent placement fees are recognized when one of the Company\u2019s professionals, or a candidate identified by the Company, accepts an offer of permanent employment from a client and all requisite terms of the agreement have been met. Such conversion fees or permanent placement fees are recognized when the performance obligation is considered complete, which the Company considers a) when the consultant or candidate accepts the position; b) the consultant or candidate has notified either RGP or their current employer of their decision; and c) the start date is within the Company\u2019s current quarter. Conversion fees were 0.3%, 0.4% and 0.5% of revenue for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively. Permanent placement fees were 0.6% of revenue for each of the years ended May 29, 2021, May 30, 2020 and May 25, 2019.
The Company\u2019s contracts generally have termination for convenience provisions and do not have termination penalties. While clients are contractually obligated to pay the Company for all hours billed, the Company does not have long-term agreements with its clients for the provision of services and the Company\u2019s clients may terminate engagements at any time. All costs of compensating the Company\u2019s professionals are the responsibility of the Company and are included in direct cost of services.
Foreign Currency Translation
The financial statements of subsidiaries outside the U.S.\u00a0are measured using the local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at current exchange rates, income and expense items are translated at average exchange rates prevailing during the period and the related translation adjustments are recorded as a component of comprehensive income or loss within stockholders\u2019 equity. Gains and losses from foreign currency transactions are included in selling, general and administrative expenses in the Consolidated Statements of Operations.
Per Share Information
The Company presents both basic and diluted earnings per share (\u201cEPS\u201d). Basic EPS is calculated by dividing net income by the weighted average number of common shares outstanding during the period. Diluted EPS is based upon the weighted average number of common shares and common equivalent shares outstanding during the period, calculated using the treasury stock method. Under the treasury stock method, exercise proceeds include the amount the employee must pay for exercising stock options, the amount of compensation cost related to stock awards for future services that the Company has not yet recognized and the amount of tax benefits that would be recorded when the award becomes deductible. Common equivalent shares are excluded from the computation in periods in which they have an anti-dilutive effect. Stock options for which the exercise price exceeds the average market price over the period are anti-dilutive and are excluded from the calculation.
The following table summarizes the calculation of net income per share for the years ended May 29, 2021, May 30, 2020 and May 25, 2019 (in thousands, except per share amounts):
\u00a0
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| For the Years Ended | |||||||
|
|
| May 29, |
| May 30, |
| May 25, | |||
|
|
| 2021 |
| 2020 |
| 2019 | |||
|
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|
|
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|
|
|
|
|
|
Net income |
|
| $ | 25,229 |
| $ | 28,285 |
| $ | 31,470 |
Basic: |
|
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|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Diluted: |
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|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Potentially dilutive shares |
|
|
| 108 |
|
| 238 |
|
| 611 |
Total dilutive shares |
|
|
| 32,552 |
|
| 32,227 |
|
| 32,207 |
Net income per common share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 1.00 |
Dilutive |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 0.98 |
Anti-dilutive shares not included above |
|
|
| 4,556 |
|
| 4,731 |
|
| 3,316 |
Cash and Cash Equivalents
The Company considers cash on hand, deposits in banks, and short-term investments purchased with an original maturity date of three months or less to be cash and cash equivalents. The carrying amounts reflected in the consolidated balance sheets for cash and cash equivalents approximate the fair values due to the short maturities of these instruments.
Financial Instruments
The fair value of the Company\u2019s financial instruments reflects the amounts that the Company estimates it will receive in connection with the sale of an asset in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy prioritizes the use of inputs used in valuation techniques into the following three levels:
Level 1 \u2013 Quoted prices in active markets for identical assets and liabilities.
Level 2 \u2013 Observable inputs other than quoted prices in active markets for identical assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets.
Level 3 \u2013 Unobservable inputs.
The following table shows the Company\u2019s financial instruments that are measured and recorded in the consolidated financial statements at fair value on a recurring basis (in thousands):
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| May 29, 2021 |
| May 30, 2020 | ||||||||||||||
|
| Level 1 |
|
| Level 2 |
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| Level 3 |
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
Liabilities: |
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|
|
Contingent consideration liability | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
Total liabilities | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
Contingent consideration liability presented in the table above is for estimated future contingent consideration cash payments related to the Company\u2019s acquisitions. Total contingent consideration liabilities were $7.1 million and $7.9 million as of May 29, 2021 and May 30, 2020, respectively. The fair value measurement of the liability is based on significant inputs not observed in the market and thus represents a Level 3 measurement. The significant unobservable inputs used in the fair value measurement of the contingent consideration liability are the Company\u2019s measures of the estimated payouts based on internally generated financial projections and discount rates. The fair value of contingent consideration liability is remeasured on a quarterly basis by the Company using additional information as it becomes available, and any change in the fair value estimates are recorded in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations. See Note 3 \u2013 Acquisitions and Dispositions.\u00a0
The Company\u2019s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and long-term debt, are carried at cost, which approximates their fair value because of the short-term maturity of these instruments or because their stated interest rates are indicative of market interest rates.
Allowance for Doubtful Accounts
The Company maintains an allowance for doubtful accounts for estimated losses resulting from its clients\u2019 failure to make required payments for services rendered. Management estimates this allowance based upon knowledge of the financial condition of the Company\u2019s clients (which may not include knowledge of all significant events), review of historical receivable and reserve trends and other pertinent information. If the financial condition of the Company\u2019s clients deteriorates or there is an unfavorable trend in aggregate receivable collections, additional allowances may be required.
The following table summarizes the activity in the allowance for doubtful accounts (in thousands):
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| Currency |
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| Beginning |
| Charged to |
| Rate |
| (Write-offs)/ |
| Ending | |||||
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| Balance |
| Operations |
| Changes |
| Recoveries |
| Balance | |||||
Years Ended: |
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May 25, 2019 |
| $ | 1,640 |
| $ | 1,540 |
| $ | - |
| $ | (660) |
| $ | 2,520 |
May 30, 2020 |
| $ | 2,520 |
| $ | 1,840 |
| $ | (18) |
| $ | (1,275) |
| $ | 3,067 |
May 29, 2021 |
| $ | 3,067 |
| $ | (55) |
| $ | 4 |
| $ | (984) |
| $ | 2,032 |
Property and Equipment
Property and equipment is stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the following estimated useful lives:
|
|
Building | 30 years |
Furniture | 5 to 10 years |
Leasehold improvements | Lesser of useful life of asset or term of lease |
Computer, equipment and software | 3 to 5 years |
Costs for normal repairs and maintenance are expensed to operations as incurred, while renewals and major refurbishments are capitalized.
Long-lived Assets
The Company evaluates the recoverability of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The impairment test comprises two steps. The first step compares the carrying amount of the asset to the sum of expected undiscounted future cash flows. If the sum of expected undiscounted future cash flows exceeds the carrying amount of the asset, no impairment is taken. If the sum of expected undiscounted future cash flows is less than the carrying amount of the asset, a second step is warranted and an impairment loss is measured as the amount by which the carrying amount of the asset exceeds its fair value calculated using the present value of estimated net future cash flows. The Company recorded right-of-use (\u201cROU\u201d) assets impairment of $0.9 million and $0.6 million for the years ended May 29, 2021 and May 30, 2020, respectively, primarily associated with exiting certain real estate leases as part of its restructuring initiatives. The impairment charges are included in selling, general and administrative expense in the Company\u2019s Consolidated Statements of Operations.
Goodwill and Intangible Assets
Goodwill is recorded at the time of an acquisition and is calculated as the difference between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired. Goodwill is not subject to amortization but the carrying value is tested for impairment on an annual basis in the fourth quarter of the fiscal year, or more frequently if the Company believes indicators of impairment exist. Impairment evaluations involve management\u2019s assessment of qualitative factors to determine whether it is more likely than not that goodwill is impaired. If management concludes from its assessment of qualitative factors that it is more likely than not that impairment exists, then a quantitative impairment test will be performed. Significant management judgment is required in the forecasts of future operating results that are used in these evaluations. The Company\u2019s interim and annual goodwill impairment analysis indicated that there was no related impairment for the fiscal years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively.
The Company\u2019s identifiable intangible assets include customer contracts and relationships, tradenames, backlog, consultant list, non-compete agreements and computer software, including internally-developed software. These assets are amortized on a straight-line basis over lives ranging from 17 months to ten years.
See Note\u00a04\u00a0\u2014 Intangible Assets and Goodwill for a further description of the Company\u2019s goodwill and intangible assets, including information about the Company\u2019s goodwill impairment assessment in connection with its change in segment reporting effective in the second quarter of fiscal 2021.
\u00a0
Leases
The Company currently leases office space, vehicles and certain equipment under operating leases expiring through 2028. At May 29, 2021, the Company had no finance leases. The Company\u2019s operating leases are primarily for real estates, which include fixed payments plus, in some cases, scheduled base rent increases over the term of the lease. Certain leases require variable payments of common area maintenance, operating expenses and real estate taxes applicable to the property. Variable payments are excluded from the measurements of lease liabilities and are expensed as incurred. Any tenant improvement allowances received from the lessor are recorded as a reduction to rent expense over the term of the lease. None of the Company\u2019s lease agreements contained residual value guarantees or material restrictive covenants. The Company has not entered into any real estate lease arrangements where it occupies the entire building. As such, the Company does not have any separate land lease components embedded within any of its real estate leases.
The Company determines if an arrangement is a lease at the inception of the contract. Specially, the Company considers whether it can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the assets. The ROU assets represent the right to use the underlying assets for the lease term and the lease liabilities represent the Company\u2019s obligation to make lease payments arising from the leases. The Company\u2019s lease liability is recognized as of the lease commencement date at the present value of the lease payments over the lease term. The Company\u2019s ROU asset is recognized as of the lease commencement date at the amount of the corresponding lease liability, adjusted for prepaid lease payments, lease incentives received, and initial direct costs incurred. The Company evaluates its ROU assets for impairment consistent with its policy for evaluating long-lived assets for impairment. See \u201cLong-lived Assets\u201d above. ROU assets are presented as operating right-of-use assets in the Company\u2019s Consolidated Balance Sheets. Operating lease liabilities are presented as operating lease liabilities, current or operating lease liabilities, noncurrent in the Company\u2019s Consolidated Balance Sheets based on their contractual due dates. Operating lease expense is recognized on a straight-line basis over the lease term, and is recognized in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations.
Most of the Company\u2019s leases do not provide an implicit rate that can be readily determined. Therefore, the Company uses a discount rate based on its incremental borrowing rate and the information available at the commencement date. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a fully collateralized basis over a similar term in an amount equal to the total lease payments in a similar economic environment. The Company has a centrally managed treasury function; therefore, the portfolio approach is applied in determining the incremental borrowing rate. Application at the portfolio level is not materially different from applying guidance at the individual lease level.
Certain of the Company\u2019s leases include one or more options to renew or terminate the lease at the Company\u2019s discretion. Generally, the renewal and termination options are not included in the ROU assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates lease renewal and termination options and, when they are reasonably certain of exercise, includes the renewal or termination option in the lease term.
In some instances, the Company subleases excess office space to third party tenants. The Company, as sublessor, continues to account for the head lease. If the lease cost for the term of the sublease exceeds the Company\u2019s anticipated sublease income for the same period, this indicates that the right-of-use asset associated with the head lease should be assessed for impairment under the long-lived asset impairment provisions. Sublease income is included in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations.
The Company has elected the practical expedient that allows lessees to choose to not separate lease and non-lease components by class of underlying asset and is applying this expedient to all real estate asset classes. Additionally, the Company has also made an accounting policy election to recognize the lease payments under short-term leases as an expense on a straight-line basis over the lease term without recognizing the lease liability and the ROU asset.
See Note\u00a06\u00a0\u2014 Leases for a further description of the Company\u2019s leases.
Stock-Based Compensation
The Company recognizes compensation expense for all share-based payment awards made to employees and directors, including restricted stock awards, restricted stock units, employee stock options awarded under the Company\u2019s 2020 Performance Incentive Plan (the \u201c2020 Plan\u201d) and the Company\u2019s 2014 Performance Incentive Plan (the \u201c2014 Plan\u201d), and employee stock purchases made via the Company\u2019s 2019 Employee Stock Purchase Plan (the \u201cESPP\u201d), based on estimated fair value at the date of grant.
The Company estimates the fair value of share-based payment awards on the date of grant using the Black-Scholes valuation model for stock options and the closing price of the Company\u2019s common stock on the date of grant for restricted stock awards and
restricted stock units. The value of the portion of the award that is ultimately expected to vest is recognized on a straight-line basis as an expense over the requisite service periods. If the actual number of forfeitures differs from that estimated by management, additional adjustments to compensation expense may be required in future periods. Excess income tax benefits and deficiencies from stock-based compensation are recognized as a discrete item within the provision for income taxes on the Company\u2019s Consolidated Statements of Operations. Stock options and restricted stock units typically vest over four years and restricted stock award vesting is determined on an individual grant basis under the 2014 Plan or the 2020 Plan.
See Note\u00a014\u00a0\u2014 Stock-Based Compensation Plans for further information on the 2020 Plan and stock-based compensation.
Income Taxes
The Company recognizes deferred income taxes for the estimated tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established to reduce deferred tax assets to the amount expected to be realized when, in management\u2019s opinion, it is more likely than not that some portion of the deferred tax assets will not be realized. The provision for income taxes represents current taxes payable net of the change during the period in deferred tax assets and liabilities. The Company also evaluates its uncertain tax positions and only recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are measured based on the largest benefit that has a greater than 50 percentage likelihood of being realized upon settlement. The Company records a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Any change in judgment related to the expected ultimate resolution of uncertain tax positions is recognized in earnings in the period in which such change occurs.
Recent Accounting Pronouncements
Accounting Pronouncements Adopted During Fiscal Year 2021
In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update No. 2016-13, \u201cFinancial Instruments \u2013 Credit Losses (Topic 326): \u00a0Measurement of Credit Losses on Financial Instruments\u201d (\u201cASU 2016-13\u201d). Under ASU 2016-13, companies are required to present financial assets, measured at amortized cost basis, at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis, such as trade receivables. The measurement of expected credit loss will be based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The Company adopted this guidance using the modified retrospective adoption method beginning with its first quarter of fiscal 2021, and applied it to all applicable accounts. The application of this new guidance did not have a material impact on the Company\u2019s consolidated financial condition, results of operations or cash flows. \u00a0
\u00a0"}]},{"name":"rpt:f-385","factDimensions":{"xbrl:concept":"rgp:BasisOfPresentationAndPrinciplesOfConsolidationPolicyPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Basis of Presentation and Principles of Consolidation
The Consolidated Financial Statements of the Company (\u201cfinancial statements\u201d) have been prepared in conformity with accounting principles generally accepted in the U.S.\u00a0(\u201cGAAP\u201d) and the rules of the Securities and Exchange Commission (\u201cSEC\u201d). The financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.
"}]},{"name":"rpt:f-386","factDimensions":{"xbrl:concept":"us-gaap:SegmentReportingPolicyPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Reporting Segments
Effective in the second quarter of fiscal 2021, the Company revised its historical one segment position and identified the following new operating segments to align with changes made in its internal management structure and its reporting structure of financial information used to assess performance and allocate resources:
\uf0b7RGP \u2013 a global business consulting practice which operates primarily under the RGP brand and focuses on project consulting and professional staffing services in areas such as finance and accounting, business strategy and transformation, risk and compliance, and technology and digital;
\uf0b7taskforce \u2013 a German professional services firm that operates under the taskforce brand. It utilizes a distinct independent contractor/partner business model and infrastructure and focuses on providing senior interim management and project management services to middle market clients in the German market;
\uf0b7Sitrick \u2013 a crisis communications and public relations firm which operates under the Sitrick brand, providing corporate, financial, transactional and crisis communication and management services.
Each of these three segments reports through a separate management team to the Company\u2019s Chief Executive Officer, who is designated as the Chief Operating Decision Maker for segment reporting purposes. RGP is the Company\u2019s only reportable segment. taskforce and Sitrick do not individually meet the quantitative thresholds to qualify as reportable segments. Therefore, they are combined and disclosed as Other Segments. Each of these segments represents a reporting unit for the purposes of assessing goodwill for impairment. All prior-period comparative segment information was recast to reflect the current reportable segments in accordance with Accounting Standards Codification (\u201cASC\u201d) 280, Segment Reporting. The change in segment reporting did not impact the Company\u2019s consolidated financial statements.
"}]},{"name":"rpt:f-387","factDimensions":{"xbrl:concept":"us-gaap:NumberOfReportableSegments","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:segment"},"factValues":[{"value":"3"}]},{"name":"rpt:f-388","factDimensions":{"xbrl:concept":"us-gaap:Reclassifications","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"ReclassificationsCertain prior period amounts have been reclassified to conform to current period presentation. These reclassifications had no effect on previously reported totals for assets, liabilities, stockholders\u2019 equity, cash flows or net income."}]},{"name":"rpt:f-389","factDimensions":{"xbrl:concept":"rgp:RisksAndUncertaintiesPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Risks and Uncertainties
The Pandemic has adversely impacted the Company\u2019 business in the past year including, among other things, reducing demand for or delaying client decisions to procure its services. In response to the Pandemic, the Company evolved its operating model to be more virtual and borderless. The move to virtual and borderless talent helped the Company manage supply and demand more efficiently,
which resulted in faster revenue generation and reduced consultant turnover, mitigating the negative impact of the Pandemic. During fiscal 2021, the Company\u2019s revenue declined 10.5% compared to fiscal 2020, as the Pandemic started to impact the Company on a worldwide basis in the fourth quarter of fiscal 2020. The Company reached a trough in revenue during the first quarter of fiscal 2021 and has since experienced a steady recovery in each sequential quarter thereafter. By the fourth quarter of fiscal 2021, the revenue decline compared to the prior year quarter improved to 3.5% year over year, and revenue in the fourth quarter of fiscal 2021 exceeded the first quarter of fiscal 2021 by 16.9%.
In order to strengthen the Company\u2019s liquidity during the Pandemic, the Company took proactive measures to increase its cash on hand including, but not limited to, borrowing $39 million under its $120.0\u00a0million secured revolving credit facility with Bank of America (the \u201cFacility\u201d) in the fourth quarter of fiscal 2020, reducing discretionary spending, and focusing on receivables collections efforts. The Company also elected to defer the deposit of its employer portion of social security taxes from April to December 2020, as provided for under the Coronavirus Aid, Relief, and Economic Security Act (\u201cCARES Act\u201d). Due to the focused efforts to contain costs and manage working capital, the Company\u2019s cash flows from operations enabled it to repay a total of $45 million on its borrowings during fiscal 2021 and another $10 million subsequently on June 9, 2021. In addition, the Company repaid a total of $6.3 million in deferred deposit of the employer portion of social security taxes prior to May 29, 2021.
As of May 29, 2021, the Company had cash and cash equivalents of $74.4 million, and additional availability under the Facility of $75.7 million. Given its balance sheet and liquidity position, management believes that the Company has the financial flexibility and resources needed to operate in the current uncertain economic environment. However, if global economic conditions worsen as a result of the Pandemic, it could materially impact the Company\u2019s liquidity position and capital needs.
The full extent to which the Pandemic impacts the Company\u2019 business and financial results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the virus and the actions to contain its impact, the impacts of new variants of the virus, and the timing, distribution, efficacy and public acceptance of vaccines and other treatments for COVID-19.
"}]},{"name":"rpt:f-390","factDimensions":{"xbrl:concept":"rgp:IncreaseDecreaseInRevenuePercentage","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"-0.105","decimals":3}]},{"name":"rpt:f-391","factDimensions":{"xbrl:concept":"rgp:IncreaseDecreaseInRevenuePercentage","xbrl:period":"2021-02-28T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"-0.035","decimals":3}]},{"name":"rpt:f-392","factDimensions":{"xbrl:concept":"rgp:IncreaseDecreaseInRevenuePercentage","xbrl:period":"2020-08-30T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"0.169","decimals":3}]},{"name":"rpt:f-393","factDimensions":{"xbrl:concept":"us-gaap:ProceedsFromLongTermLinesOfCredit","xbrl:period":"2020-02-23T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"39000000","decimals":-6}]},{"name":"rpt:f-394","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"120000000.0","decimals":-5}]},{"name":"rpt:f-395","factDimensions":{"xbrl:concept":"us-gaap:RepaymentsOfDebt","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"45000000","decimals":-6}]},{"name":"rpt:f-396","factDimensions":{"xbrl:concept":"us-gaap:RepaymentsOfDebt","xbrl:period":"2021-06-09T00:00:00/2021-06-10T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:SubsequentEventTypeAxis":"us-gaap:SubsequentEventMember"},"factValues":[{"value":"10000000","decimals":-6}]},{"name":"rpt:f-397","factDimensions":{"xbrl:concept":"rgp:RepaymentOfDeferredSocialSecurityTaxesDepositsCaresAct","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6300000","decimals":-5}]},{"name":"rpt:f-398","factDimensions":{"xbrl:concept":"us-gaap:CashAndCashEquivalentsAtCarryingValue","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"74400000","decimals":-5}]},{"name":"rpt:f-399","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityRemainingBorrowingCapacity","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"75700000","decimals":-5}]},{"name":"rpt:f-400","factDimensions":{"xbrl:concept":"us-gaap:UseOfEstimates","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although management believes these estimates and assumptions are adequate, actual results could differ from the estimates and assumptions used.
"}]},{"name":"rpt:f-401","factDimensions":{"xbrl:concept":"us-gaap:RevenueRecognitionPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Revenue Recognition
The Company generates substantially all of its revenues from providing professional consulting services to its clients. Revenues are recognized when control of the promised service is transferred to the Company\u2019s clients, in an amount that reflects the consideration expected in exchange for the services. Revenue is recorded net of sales or other transaction taxes collected from clients and remitted to taxing authorities. Revenues from contracts are recognized over time, based on hours worked by the Company\u2019s professionals. The performance of the agreed-to service over time is the single performance obligation for revenues. Certain clients may receive discounts (for example, volume discounts or rebates) to the amounts billed. These discounts or rebates are considered variable consideration. Management evaluates the facts and circumstances of each contract and client relationship to estimate the variable consideration assessing the most likely amount to recognize and considering management\u2019s expectation of the volume of services to be provided over the applicable period. Rebates are the largest component of variable consideration and are estimated using the most likely amount method, contracts terms and estimates of revenue. Revenues are recognized net of variable consideration to the extent that it is probable that a significant reversal of revenues will not occur in subsequent periods.
On a limited basis, the Company may have fixed-price contracts, for which revenues are recognized over time using the input method based on time incurred as a proportion of estimated total time. Time incurred represents work performed, which corresponds with, and therefore best depicts, the transfer of control to the client. Management uses significant judgments when estimating the total hours expected to complete the contract performance obligation. It is possible that updated estimates for consulting engagements may vary from initial estimates with such updates being recognized in the period of determination. Depending on the timing of billings and services rendered, the Company accrues or defers revenue as appropriate.
\u00a0
The Company recognizes revenues primarily on a gross basis as it acts as a principal for primarily all of its revenue transactions. The Company has concluded that gross reporting is appropriate because it controls the services before they are transferred to the customers. The Company a) has the risk of identifying and hiring qualified consultants; b) has the discretion to select the consultants and establish the price and responsibilities for services to be provided; c) is primarily responsible for fulfilling the promise to provide the service to the customer; and d) bears the risk for services provided that are not fully paid for by clients. The Company recognizes all reimbursements received from clients for \u201cout-of-pocket\u201d expenses as revenue and all such expenses as direct cost of services.
Reimbursements received from clients were $3.2 million, $9.4\u00a0million and $12.3\u00a0million for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively.
Commissions earned by the Company\u2019 sales professionals are considered incremental and recoverable costs of obtaining a contract with a customer. The Company elected to apply the practical expedient to expense sales commissions as incurred as the expected amortization period is one year or less. Sales commissions are recorded in selling, general and administrative expenses in the Company\u2019s Consolidated Statement of Operations. During the years ended May 29, 2021, May 30, 2020, and May 25, 2019, sales commission expense was $5.9 million, $6.3 million, and $6.7 million, respectively.
The Company\u2019s clients are contractually obligated to pay the Company for all hours billed. The Company invoices the majority of its clients on a weekly basis or, in certain circumstances, on a bi-weekly or monthly basis, and its typical arrangement of payment is due within 30 days. To a much lesser extent, in certain circumstances, the Company also earns revenue if one of its consultants is hired by, or if the Company places an outside candidate with, its client. Conversion fees or permanent placement fees are recognized when one of the Company\u2019s professionals, or a candidate identified by the Company, accepts an offer of permanent employment from a client and all requisite terms of the agreement have been met. Such conversion fees or permanent placement fees are recognized when the performance obligation is considered complete, which the Company considers a) when the consultant or candidate accepts the position; b) the consultant or candidate has notified either RGP or their current employer of their decision; and c) the start date is within the Company\u2019s current quarter. Conversion fees were 0.3%, 0.4% and 0.5% of revenue for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively. Permanent placement fees were 0.6% of revenue for each of the years ended May 29, 2021, May 30, 2020 and May 25, 2019.
The Company\u2019s contracts generally have termination for convenience provisions and do not have termination penalties. While clients are contractually obligated to pay the Company for all hours billed, the Company does not have long-term agreements with its clients for the provision of services and the Company\u2019s clients may terminate engagements at any time. All costs of compensating the Company\u2019s professionals are the responsibility of the Company and are included in direct cost of services.
"}]},{"name":"rpt:f-402","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:ReimbursementsMember"},"factValues":[{"value":"3200000","decimals":-5}]},{"name":"rpt:f-403","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:ReimbursementsMember"},"factValues":[{"value":"9400000","decimals":-5}]},{"name":"rpt:f-404","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:ReimbursementsMember"},"factValues":[{"value":"12300000","decimals":-5}]},{"name":"rpt:f-405","factDimensions":{"xbrl:concept":"us-gaap:CostOfGoodsAndServicesSold","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:SalesCommissionsMember"},"factValues":[{"value":"5900000","decimals":-5}]},{"name":"rpt:f-406","factDimensions":{"xbrl:concept":"us-gaap:CostOfGoodsAndServicesSold","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:SalesCommissionsMember"},"factValues":[{"value":"6300000","decimals":-5}]},{"name":"rpt:f-407","factDimensions":{"xbrl:concept":"us-gaap:CostOfGoodsAndServicesSold","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ProductOrServiceAxis":"rgp:SalesCommissionsMember"},"factValues":[{"value":"6700000","decimals":-5}]},{"name":"rpt:f-408","factDimensions":{"xbrl:concept":"rgp:RevenuePercentage","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","srt:ProductOrServiceAxis":"rgp:ConversionFeesMember"},"factValues":[{"value":"0.003","decimals":3}]},{"name":"rpt:f-409","factDimensions":{"xbrl:concept":"rgp:RevenuePercentage","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","srt:ProductOrServiceAxis":"rgp:ConversionFeesMember"},"factValues":[{"value":"0.004","decimals":3}]},{"name":"rpt:f-410","factDimensions":{"xbrl:concept":"rgp:RevenuePercentage","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","srt:ProductOrServiceAxis":"rgp:ConversionFeesMember"},"factValues":[{"value":"0.005","decimals":3}]},{"name":"rpt:f-411","factDimensions":{"xbrl:concept":"rgp:RevenuePercentage","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","srt:ProductOrServiceAxis":"rgp:PermanentPlacementFeesMember"},"factValues":[{"value":"0.006","decimals":3}]},{"name":"rpt:f-412","factDimensions":{"xbrl:concept":"us-gaap:ForeignCurrencyTransactionsAndTranslationsPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Foreign Currency Translation
The financial statements of subsidiaries outside the U.S.\u00a0are measured using the local currency as the functional currency. Assets and liabilities of these subsidiaries are translated at current exchange rates, income and expense items are translated at average exchange rates prevailing during the period and the related translation adjustments are recorded as a component of comprehensive income or loss within stockholders\u2019 equity. Gains and losses from foreign currency transactions are included in selling, general and administrative expenses in the Consolidated Statements of Operations.
"}]},{"name":"rpt:f-413","factDimensions":{"xbrl:concept":"us-gaap:EarningsPerSharePolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Per Share Information
The Company presents both basic and diluted earnings per share (\u201cEPS\u201d). Basic EPS is calculated by dividing net income by the weighted average number of common shares outstanding during the period. Diluted EPS is based upon the weighted average number of common shares and common equivalent shares outstanding during the period, calculated using the treasury stock method. Under the treasury stock method, exercise proceeds include the amount the employee must pay for exercising stock options, the amount of compensation cost related to stock awards for future services that the Company has not yet recognized and the amount of tax benefits that would be recorded when the award becomes deductible. Common equivalent shares are excluded from the computation in periods in which they have an anti-dilutive effect. Stock options for which the exercise price exceeds the average market price over the period are anti-dilutive and are excluded from the calculation.
The following table summarizes the calculation of net income per share for the years ended May 29, 2021, May 30, 2020 and May 25, 2019 (in thousands, except per share amounts):
\u00a0
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
|
| May 29, |
| May 30, |
| May 25, | |||
|
|
| 2021 |
| 2020 |
| 2019 | |||
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
| $ | 25,229 |
| $ | 28,285 |
| $ | 31,470 |
Basic: |
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Diluted: |
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Potentially dilutive shares |
|
|
| 108 |
|
| 238 |
|
| 611 |
Total dilutive shares |
|
|
| 32,552 |
|
| 32,227 |
|
| 32,207 |
Net income per common share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 1.00 |
Dilutive |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 0.98 |
Anti-dilutive shares not included above |
|
|
| 4,556 |
|
| 4,731 |
|
| 3,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
|
| May 29, |
| May 30, |
| May 25, | |||
|
|
| 2021 |
| 2020 |
| 2019 | |||
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
| $ | 25,229 |
| $ | 28,285 |
| $ | 31,470 |
Basic: |
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Diluted: |
|
|
|
|
|
|
|
|
|
|
Weighted average shares |
|
|
| 32,444 |
|
| 31,989 |
|
| 31,596 |
Potentially dilutive shares |
|
|
| 108 |
|
| 238 |
|
| 611 |
Total dilutive shares |
|
|
| 32,552 |
|
| 32,227 |
|
| 32,207 |
Net income per common share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 1.00 |
Dilutive |
|
| $ | 0.78 |
| $ | 0.88 |
| $ | 0.98 |
Anti-dilutive shares not included above |
|
|
| 4,556 |
|
| 4,731 |
|
| 3,316 |
Cash and Cash Equivalents
The Company considers cash on hand, deposits in banks, and short-term investments purchased with an original maturity date of three months or less to be cash and cash equivalents. The carrying amounts reflected in the consolidated balance sheets for cash and cash equivalents approximate the fair values due to the short maturities of these instruments.
"}]},{"name":"rpt:f-440","factDimensions":{"xbrl:concept":"us-gaap:FairValueOfFinancialInstrumentsPolicy","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Financial Instruments
The fair value of the Company\u2019s financial instruments reflects the amounts that the Company estimates it will receive in connection with the sale of an asset in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy prioritizes the use of inputs used in valuation techniques into the following three levels:
Level 1 \u2013 Quoted prices in active markets for identical assets and liabilities.
Level 2 \u2013 Observable inputs other than quoted prices in active markets for identical assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets.
Level 3 \u2013 Unobservable inputs.
The following table shows the Company\u2019s financial instruments that are measured and recorded in the consolidated financial statements at fair value on a recurring basis (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| May 29, 2021 |
| May 30, 2020 | ||||||||||||||
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent consideration liability | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
Total liabilities | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
Contingent consideration liability presented in the table above is for estimated future contingent consideration cash payments related to the Company\u2019s acquisitions. Total contingent consideration liabilities were $7.1 million and $7.9 million as of May 29, 2021 and May 30, 2020, respectively. The fair value measurement of the liability is based on significant inputs not observed in the market and thus represents a Level 3 measurement. The significant unobservable inputs used in the fair value measurement of the contingent consideration liability are the Company\u2019s measures of the estimated payouts based on internally generated financial projections and discount rates. The fair value of contingent consideration liability is remeasured on a quarterly basis by the Company using additional information as it becomes available, and any change in the fair value estimates are recorded in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations. See Note 3 \u2013 Acquisitions and Dispositions.\u00a0
The Company\u2019s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and long-term debt, are carried at cost, which approximates their fair value because of the short-term maturity of these instruments or because their stated interest rates are indicative of market interest rates.
"}]},{"name":"rpt:f-441","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfFairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| May 29, 2021 |
| May 30, 2020 | ||||||||||||||
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent consideration liability | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
Total liabilities | $ | - |
| $ | - |
| $ | 7,129 |
| $ | - |
| $ | - |
| $ | 7,898 |
The Company maintains an allowance for doubtful accounts for estimated losses resulting from its clients\u2019 failure to make required payments for services rendered. Management estimates this allowance based upon knowledge of the financial condition of the Company\u2019s clients (which may not include knowledge of all significant events), review of historical receivable and reserve trends and other pertinent information. If the financial condition of the Company\u2019s clients deteriorates or there is an unfavorable trend in aggregate receivable collections, additional allowances may be required.
The following table summarizes the activity in the allowance for doubtful accounts (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| Currency |
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|
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|
|
| |
|
| Beginning |
| Charged to |
| Rate |
| (Write-offs)/ |
| Ending | |||||
|
| Balance |
| Operations |
| Changes |
| Recoveries |
| Balance | |||||
Years Ended: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May 25, 2019 |
| $ | 1,640 |
| $ | 1,540 |
| $ | - |
| $ | (660) |
| $ | 2,520 |
May 30, 2020 |
| $ | 2,520 |
| $ | 1,840 |
| $ | (18) |
| $ | (1,275) |
| $ | 3,067 |
May 29, 2021 |
| $ | 3,067 |
| $ | (55) |
| $ | 4 |
| $ | (984) |
| $ | 2,032 |
|
|
|
|
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| Currency |
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| |
|
| Beginning |
| Charged to |
| Rate |
| (Write-offs)/ |
| Ending | |||||
|
| Balance |
| Operations |
| Changes |
| Recoveries |
| Balance | |||||
Years Ended: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May 25, 2019 |
| $ | 1,640 |
| $ | 1,540 |
| $ | - |
| $ | (660) |
| $ | 2,520 |
May 30, 2020 |
| $ | 2,520 |
| $ | 1,840 |
| $ | (18) |
| $ | (1,275) |
| $ | 3,067 |
May 29, 2021 |
| $ | 3,067 |
| $ | (55) |
| $ | 4 |
| $ | (984) |
| $ | 2,032 |
Property and equipment is stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the following estimated useful lives:
|
|
Building | 30 years |
Furniture | 5 to 10 years |
Leasehold improvements | Lesser of useful life of asset or term of lease |
Computer, equipment and software | 3 to 5 years |
Costs for normal repairs and maintenance are expensed to operations as incurred, while renewals and major refurbishments are capitalized.
"}]},{"name":"rpt:f-465","factDimensions":{"xbrl:concept":"rgp:ScheduleOfEstimatedUsefulLivesOfPropertyAndEquipmentTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
Building | 30 years |
Furniture | 5 to 10 years |
Leasehold improvements | Lesser of useful life of asset or term of lease |
Computer, equipment and software | 3 to 5 years |
The Company evaluates the recoverability of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The impairment test comprises two steps. The first step compares the carrying amount of the asset to the sum of expected undiscounted future cash flows. If the sum of expected undiscounted future cash flows exceeds the carrying amount of the asset, no impairment is taken. If the sum of expected undiscounted future cash flows is less than the carrying amount of the asset, a second step is warranted and an impairment loss is measured as the amount by which the carrying amount of the asset exceeds its fair value calculated using the present value of estimated net future cash flows. The Company recorded right-of-use (\u201cROU\u201d) assets impairment of $0.9 million and $0.6 million for the years ended May 29, 2021 and May 30, 2020, respectively, primarily associated with exiting certain real estate leases as part of its restructuring initiatives. The impairment charges are included in selling, general and administrative expense in the Company\u2019s Consolidated Statements of Operations.
"}]},{"name":"rpt:f-472","factDimensions":{"xbrl:concept":"us-gaap:AssetImpairmentCharges","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"900000","decimals":-5}]},{"name":"rpt:f-473","factDimensions":{"xbrl:concept":"us-gaap:AssetImpairmentCharges","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"600000","decimals":-5}]},{"name":"rpt:f-474","factDimensions":{"xbrl:concept":"us-gaap:GoodwillAndIntangibleAssetsPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Goodwill and Intangible Assets
Goodwill is recorded at the time of an acquisition and is calculated as the difference between the aggregate consideration paid for an acquisition and the fair value of the net tangible and intangible assets acquired. Goodwill is not subject to amortization but the carrying value is tested for impairment on an annual basis in the fourth quarter of the fiscal year, or more frequently if the Company believes indicators of impairment exist. Impairment evaluations involve management\u2019s assessment of qualitative factors to determine whether it is more likely than not that goodwill is impaired. If management concludes from its assessment of qualitative factors that it is more likely than not that impairment exists, then a quantitative impairment test will be performed. Significant management judgment is required in the forecasts of future operating results that are used in these evaluations. The Company\u2019s interim and annual goodwill impairment analysis indicated that there was no related impairment for the fiscal years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively.
The Company\u2019s identifiable intangible assets include customer contracts and relationships, tradenames, backlog, consultant list, non-compete agreements and computer software, including internally-developed software. These assets are amortized on a straight-line basis over lives ranging from 17 months to ten years.
See Note\u00a04\u00a0\u2014 Intangible Assets and Goodwill for a further description of the Company\u2019s goodwill and intangible assets, including information about the Company\u2019s goodwill impairment assessment in connection with its change in segment reporting effective in the second quarter of fiscal 2021.
"}]},{"name":"rpt:f-475","factDimensions":{"xbrl:concept":"us-gaap:GoodwillImpairedAccumulatedImpairmentLoss","xbrl:period":"2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"0","decimals":0}]},{"name":"rpt:f-476","factDimensions":{"xbrl:concept":"us-gaap:GoodwillImpairedAccumulatedImpairmentLoss","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"0","decimals":0}]},{"name":"rpt:f-477","factDimensions":{"xbrl:concept":"us-gaap:GoodwillImpairedAccumulatedImpairmentLoss","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"0","decimals":0}]},{"name":"rpt:f-478","factDimensions":{"xbrl:concept":"us-gaap:FiniteLivedIntangibleAssetUsefulLife","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MinimumMember"},"factValues":[{"value":"P17M"}]},{"name":"rpt:f-479","factDimensions":{"xbrl:concept":"us-gaap:FiniteLivedIntangibleAssetUsefulLife","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MaximumMember"},"factValues":[{"value":"P10Y"}]},{"name":"rpt:f-480","factDimensions":{"xbrl:concept":"us-gaap:LesseeLeasesPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Leases
The Company currently leases office space, vehicles and certain equipment under operating leases expiring through 2028. At May 29, 2021, the Company had no finance leases. The Company\u2019s operating leases are primarily for real estates, which include fixed payments plus, in some cases, scheduled base rent increases over the term of the lease. Certain leases require variable payments of common area maintenance, operating expenses and real estate taxes applicable to the property. Variable payments are excluded from the measurements of lease liabilities and are expensed as incurred. Any tenant improvement allowances received from the lessor are recorded as a reduction to rent expense over the term of the lease. None of the Company\u2019s lease agreements contained residual value guarantees or material restrictive covenants. The Company has not entered into any real estate lease arrangements where it occupies the entire building. As such, the Company does not have any separate land lease components embedded within any of its real estate leases.
The Company determines if an arrangement is a lease at the inception of the contract. Specially, the Company considers whether it can control the underlying asset and have the right to obtain substantially all of the economic benefits or outputs from the assets. The ROU assets represent the right to use the underlying assets for the lease term and the lease liabilities represent the Company\u2019s obligation to make lease payments arising from the leases. The Company\u2019s lease liability is recognized as of the lease commencement date at the present value of the lease payments over the lease term. The Company\u2019s ROU asset is recognized as of the lease commencement date at the amount of the corresponding lease liability, adjusted for prepaid lease payments, lease incentives received, and initial direct costs incurred. The Company evaluates its ROU assets for impairment consistent with its policy for evaluating long-lived assets for impairment. See \u201cLong-lived Assets\u201d above. ROU assets are presented as operating right-of-use assets in the Company\u2019s Consolidated Balance Sheets. Operating lease liabilities are presented as operating lease liabilities, current or operating lease liabilities, noncurrent in the Company\u2019s Consolidated Balance Sheets based on their contractual due dates. Operating lease expense is recognized on a straight-line basis over the lease term, and is recognized in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations.
Most of the Company\u2019s leases do not provide an implicit rate that can be readily determined. Therefore, the Company uses a discount rate based on its incremental borrowing rate and the information available at the commencement date. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow on a fully collateralized basis over a similar term in an amount equal to the total lease payments in a similar economic environment. The Company has a centrally managed treasury function; therefore, the portfolio approach is applied in determining the incremental borrowing rate. Application at the portfolio level is not materially different from applying guidance at the individual lease level.
Certain of the Company\u2019s leases include one or more options to renew or terminate the lease at the Company\u2019s discretion. Generally, the renewal and termination options are not included in the ROU assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates lease renewal and termination options and, when they are reasonably certain of exercise, includes the renewal or termination option in the lease term.
In some instances, the Company subleases excess office space to third party tenants. The Company, as sublessor, continues to account for the head lease. If the lease cost for the term of the sublease exceeds the Company\u2019s anticipated sublease income for the same period, this indicates that the right-of-use asset associated with the head lease should be assessed for impairment under the long-lived asset impairment provisions. Sublease income is included in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations.
The Company has elected the practical expedient that allows lessees to choose to not separate lease and non-lease components by class of underlying asset and is applying this expedient to all real estate asset classes. Additionally, the Company has also made an accounting policy election to recognize the lease payments under short-term leases as an expense on a straight-line basis over the lease term without recognizing the lease liability and the ROU asset.
See Note\u00a06\u00a0\u2014 Leases for a further description of the Company\u2019s leases.
"}]},{"name":"rpt:f-481","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationOptionAndIncentivePlansPolicy","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Stock-Based Compensation
The Company recognizes compensation expense for all share-based payment awards made to employees and directors, including restricted stock awards, restricted stock units, employee stock options awarded under the Company\u2019s 2020 Performance Incentive Plan (the \u201c2020 Plan\u201d) and the Company\u2019s 2014 Performance Incentive Plan (the \u201c2014 Plan\u201d), and employee stock purchases made via the Company\u2019s 2019 Employee Stock Purchase Plan (the \u201cESPP\u201d), based on estimated fair value at the date of grant.
The Company estimates the fair value of share-based payment awards on the date of grant using the Black-Scholes valuation model for stock options and the closing price of the Company\u2019s common stock on the date of grant for restricted stock awards and
restricted stock units. The value of the portion of the award that is ultimately expected to vest is recognized on a straight-line basis as an expense over the requisite service periods. If the actual number of forfeitures differs from that estimated by management, additional adjustments to compensation expense may be required in future periods. Excess income tax benefits and deficiencies from stock-based compensation are recognized as a discrete item within the provision for income taxes on the Company\u2019s Consolidated Statements of Operations. Stock options and restricted stock units typically vest over four years and restricted stock award vesting is determined on an individual grant basis under the 2014 Plan or the 2020 Plan.
See Note\u00a014\u00a0\u2014 Stock-Based Compensation Plans for further information on the 2020 Plan and stock-based compensation.
"}]},{"name":"rpt:f-482","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardAwardVestingPeriod1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"P4Y"}]},{"name":"rpt:f-483","factDimensions":{"xbrl:concept":"us-gaap:IncomeTaxPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Income Taxes
The Company recognizes deferred income taxes for the estimated tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year-end based on enacted tax laws and statutory rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established to reduce deferred tax assets to the amount expected to be realized when, in management\u2019s opinion, it is more likely than not that some portion of the deferred tax assets will not be realized. The provision for income taxes represents current taxes payable net of the change during the period in deferred tax assets and liabilities. The Company also evaluates its uncertain tax positions and only recognizes the tax benefit from an uncertain tax position if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are measured based on the largest benefit that has a greater than 50 percentage likelihood of being realized upon settlement. The Company records a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Any change in judgment related to the expected ultimate resolution of uncertain tax positions is recognized in earnings in the period in which such change occurs.
"}]},{"name":"rpt:f-484","factDimensions":{"xbrl:concept":"us-gaap:NewAccountingPronouncementsPolicyPolicyTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"Recent Accounting Pronouncements
Accounting Pronouncements Adopted During Fiscal Year 2021
In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update No. 2016-13, \u201cFinancial Instruments \u2013 Credit Losses (Topic 326): \u00a0Measurement of Credit Losses on Financial Instruments\u201d (\u201cASU 2016-13\u201d). Under ASU 2016-13, companies are required to present financial assets, measured at amortized cost basis, at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis, such as trade receivables. The measurement of expected credit loss will be based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The Company adopted this guidance using the modified retrospective adoption method beginning with its first quarter of fiscal 2021, and applied it to all applicable accounts. The application of this new guidance did not have a material impact on the Company\u2019s consolidated financial condition, results of operations or cash flows. \u00a0
"}]},{"name":"rpt:f-485","factDimensions":{"xbrl:concept":"rgp:AcquisitionsAndDivestituresDisclosureTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"3.\u00a0Acquisitions and Dispositions
The Company did not complete any acquisitions during the year ended May 29, 2021.
Prior Year Acquisitions
During fiscal 2020, the Company completed two acquisitions. The first acquisition, completed November 30, 2019, was Expertforce Interim Projects GmbH, LLC (\u201cExpertence\u201d), a leading provider of professional interim management services, based in Munich, Germany. With the acquisition of Expertence, the Company is able to offer a full range of project and management consulting services in the German market.\u00a0\u00a0The Company paid an initial cash consideration of $0.4 million. The initial consideration is subject to final adjustments for the impact of working capital as defined in the purchase agreement.
\u00a0 \u00a0
In addition, the purchase agreement required earn-out payments to be made based on performance over an 18-month period that ended on May 31, 2021. The Company was obligated to pay the former owners of Expertence contingent consideration if certain revenue targets were achieved, up to a maximum of $0.3 million, and as a result, made payments of contingent consideration equal to $0.3 million in July 2021.\u00a0\u00a0In determining the fair value of the contingent consideration liability, the Company used an estimate based on a number of possible projections over the earnout period and applied a probability to each possible outcome.\u00a0\u00a0Given the short duration of the earnout period, the fair value of contingent liability was measured on an undiscounted basis.\u00a0The Company remeasures the fair value of the contingent consideration at each reporting period, and any change in fair value is recognized in the Company\u2019s results of operations in the applicable period. The estimate of the fair value of contingent consideration requires very subjective assumptions to be made of various potential revenue results.\u00a0Given that the performance period has ended, the Company does not expect to make any future revisions to these assumptions to materially change the estimate of the fair value of contingent consideration.
Fair value of consideration transferred (in thousands):
|
|
|
Cash | $ | 383\u00a0 |
Estimated initial contingent consideration |
| 305\u00a0 |
Total | $ | 688\u00a0 |
The following table summarizes the final valuation of the assets acquired and liabilities assumed at the acquisition date (dollars in thousands):
|
|
|
|
|
|
Cash and cash equivalents | $ | 11\u00a0 |
Accounts receivable |
| 215\u00a0 |
Prepaid expenses and other current assets |
| 7\u00a0 |
Intangible assets: |
|
|
Computer software (24 months useful life) |
| 184\u00a0 |
Total identifiable assets |
| 417\u00a0 |
Accounts payable |
| 196\u00a0 |
Accrued expenses and other current liabilities |
| 8\u00a0 |
Deferred tax liability |
| 59\u00a0 |
Total liabilities assumed |
| 263\u00a0 |
Net identifiable assets acquired |
| 154\u00a0 |
Goodwill |
| 534\u00a0 |
Net assets acquired | $ | 688\u00a0 |
Results of operations of Expertence are included in the Consolidated Statements of Operations from the date of acquisition and is not material to the Company\u2019s consolidated results of operations for the years ended May 29, 2021 and May 30, 2020. The amount of the acquisition costs incurred as included in the Consolidated Statements of Operations for the year ended May 30, 2020 was immaterial.
The second acquisition occurred on July 31, 2019 when the Company acquired Veracity Consulting Group, LLC (\u201cVeracity\u201d), a fast-growing, digital transformation firm based in Richmond, Virginia, that delivers innovative solutions to the Fortune 500 and leading healthcare organizations. The acquisition of Veracity was a critical step in accelerating the Company\u2019s stated objective to enhance its digital capabilities and allows the Company to offer comprehensive end-to-end solutions to its clients by combining Veracity\u2019s customer-facing offerings with the Company\u2019s depth of experience in transforming the back office. The Company paid an initial cash consideration of $30.3 million (net of $2.1 million cash acquired). The initial consideration is subject to final adjustments for the impact of the Internal Revenue Code Section 338(h)(10) joint election between the Company and former owners of Veracity and working capital as defined in the purchase agreement.
In addition, the purchase agreement requires earn-out payments to be made in cash based on performance after each of the first and second anniversary of the acquisition date. The Company is obligated to pay the former owners of Veracity contingent consideration if certain earnings before interest, taxes, depreciation and amortization (\u201cEBITDA\u201d) thresholds are achieved. In determining the fair value of the contingent consideration liability, the Company used the Monte Carlo simulation modeling which included the application of an appropriate discount rate (Level 3 fair value). The Company remeasures the fair value of the contingent consideration at each reporting period, and any change in fair value is be recognized in the Company\u2019s results of operations in the applicable period. The estimate of fair value of contingent consideration requires very subjective assumptions to be made, including various potential EBITDA results and discount rates. Future revisions to these assumptions could materially change the estimate of the fair value of contingent consideration and therefore could materially affect the Company\u2019s future operating results.
During the quarter ended August 24, 2019, the Company made an initial provisional allocation of the purchase price for Veracity based on the fair value of the assets acquired and liabilities assumed, with the residual amount recorded as goodwill, in accordance with ASC 805, Business Combinations. The Company\u2019s initial purchase price allocation considered a number of factors, including the valuation of identifiable intangible assets and contingent consideration. During the three months ended November 23, 2019, the Company adjusted the previously reported provisional allocation of the purchase price to reflect new information obtained during the quarter, which resulted in changes in expected future performance and cash flows as of the acquisition date. There were no additional adjustments to the provisional purchase price allocation during the remainder of the measurement period.
The following table provides a summary of the final purchase price allocation.
Fair value of consideration transferred (in thousands):
|
|
|
|
|
|
Cash | $ | 32,314\u00a0 |
Estimated initial contingent consideration |
| 6,290\u00a0 |
Total | $ | 38,604\u00a0 |
Recognized final amounts of identifiable assets acquired and liabilities assumed (dollars in thousands):
|
|
|
Cash and cash equivalents | $ | 2,056\u00a0 |
Accounts receivable |
| 3,299\u00a0 |
Prepaid expenses and other current assets |
| 116\u00a0 |
Intangible assets: |
|
|
Backlog (17 months useful life) |
| 1,210\u00a0 |
Customer relationships (7 years useful life) |
| 9,300\u00a0 |
Trademarks (3 years useful life) |
| 570\u00a0 |
Property and equipment |
| 117\u00a0 |
Total identifiable assets |
| 16,668\u00a0 |
Accounts payable |
| 305\u00a0 |
Accrued expenses and other current liabilities |
| 712\u00a0 |
Total liabilities assumed |
| 1,017\u00a0 |
Net identifiable assets acquired |
| 15,651\u00a0 |
Goodwill |
| 22,953\u00a0 |
Net assets acquired | $ | 38,604\u00a0 |
\u00a0
During the years ended May 29, 2021 and May 30, 2020, the fair value of the Veracity contingent consideration liability increased by $4.5 million and $1.3 million, respectively.\u00a0\u00a0Such amounts were recorded in selling, general and administrative expenses in the Consolidated Statements of Operations.\u00a0\u00a0In November 2020, the Company paid $5.3 million in contingent consideration to the former owners of Veracity relating to the first earn-out period. As of May 29, 2021, the contingent consideration liability related to Veracity for the second and final earn-out period was $6.8 million, all of which was included in Other current liabilities in the Consolidated Balance Sheet. As of May 30, 2020, the contingent consideration liability was $7.6 million, of which $5.0 million was included in Other current liabilities and $2.6 million was included in Other long-term liabilities in the Consolidated Balance Sheet.
\ufeff
Results of operations of Veracity are included in the Consolidated Statements of Operations from the date of acquisition. Veracity\u00a0contributed $26.2 million to consolidated revenue and $6.6 million to income from operations during the year ended May 29, 2021, and $18.8 million to consolidated revenue and $4.1 million to income from operations during the year ended May 30, 2020.\u00a0The Company incurred $0.6 million in acquisition costs which were recorded in selling, general and administrative expenses in the Consolidated Statements of Operations during the year ended May 30, 2020.
Dispositions
As part of its restructuring initiatives in Europe, the Company completed or substantially completed the dissolution of certain of its foreign subsidiaries in Europe as of May 29, 2021. The dissolutions did not have a material impact on the Company\u2019s financial condition, results of operations or cash flows for the year ended May 29, 2021. See Note 13 \u2013 Restructuring Activities for further information on the Company\u2019s restructuring initiatives.
Prior Year Dispositions
During the fourth quarter of fiscal 2020, the Company discontinued its operations in Belgium, Luxembourg and Norway. All three legal entities were dissolved as of the end of fiscal 2020. In connection with the foregoing sale of assets and exit activities, the Company incurred costs of approximately $0.7 million primarily related to employee termination benefits. Such expenses were included in selling, general and administrative expenses in the Consolidated Statements of Operations for the year ended May 30, 2020. None of the markets sold or exited are considered strategic components of the Company\u2019s operations.
On September 2, 2019, the Company completed the sale of certain assets and liabilities of its foreign subsidiary, Resources Global Professionals Sweden AB, to Capacent Holding AB (publ), a Swedish public company, for SEK1,016,862 (approximately $105,000) in cash, resulting in a loss on sale of assets of approximately $38,000. As a part the sale, the Company transferred the majority of its local customer contracts, the existing office lease as well as all its employee consultants. As a result of the sale, the nearby Denmark and Norway markets also discontinued serving local Sweden customer contracts.
In connection with exiting the above-mentioned entities, the Company analyzed the facts and circumstances regarding its historical and current investments, along with its associated accounting and tax positions. Based on the analysis, the Company recorded a tax benefit related to the worthless stock loss in the investment in its wholly owned subsidiaries as well as worthless loans to these subsidiaries. See Note 8 \u2013 Income taxes."}]},{"name":"rpt:f-486","factDimensions":{"xbrl:concept":"us-gaap:NumberOfBusinessesAcquired","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:item"},"factValues":[{"value":"0"}]},{"name":"rpt:f-487","factDimensions":{"xbrl:concept":"us-gaap:NumberOfBusinessesAcquired","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:item"},"factValues":[{"value":"2"}]},{"name":"rpt:f-488","factDimensions":{"xbrl:concept":"us-gaap:PaymentsToAcquireBusinessesGross","xbrl:period":"2019-11-30T00:00:00/2019-12-01T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:BusinessAcquisitionAxis":"rgp:ExpertenceMember"},"factValues":[{"value":"400000","decimals":-5}]},{"name":"rpt:f-489","factDimensions":{"xbrl:concept":"rgp:ContingentConsiderationMeasurementPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:BusinessAcquisitionAxis":"rgp:ExpertenceMember"},"factValues":[{"value":"P18M"}]},{"name":"rpt:f-490","factDimensions":{"xbrl:concept":"us-gaap:BusinessCombinationContingentConsiderationArrangementsRangeOfOutcomesValueHigh","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:BusinessAcquisitionAxis":"rgp:ExpertenceMember"},"factValues":[{"value":"300000","decimals":-5}]},{"name":"rpt:f-491","factDimensions":{"xbrl:concept":"us-gaap:PaymentForContingentConsiderationLiabilityInvestingActivities","xbrl:period":"2021-07-01T00:00:00/2021-08-01T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementScenarioAxis":"srt:ScenarioForecastMember","us-gaap:BusinessAcquisitionAxis":"rgp:ExpertenceMember"},"factValues":[{"value":"300000","decimals":-5}]},{"name":"rpt:f-492","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfBusinessAcquisitionsByAcquisitionTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:BusinessAcquisitionAxis":"rgp:ExpertenceMember"},"factValues":[{"value":"
|
|
|
Cash | $ | 383\u00a0 |
Estimated initial contingent consideration |
| 305\u00a0 |
Total | $ | 688\u00a0 |
|
|
|
|
|
|
Cash and cash equivalents | $ | 11\u00a0 |
Accounts receivable |
| 215\u00a0 |
Prepaid expenses and other current assets |
| 7\u00a0 |
Intangible assets: |
|
|
Computer software (24 months useful life) |
| 184\u00a0 |
Total identifiable assets |
| 417\u00a0 |
Accounts payable |
| 196\u00a0 |
Accrued expenses and other current liabilities |
| 8\u00a0 |
Deferred tax liability |
| 59\u00a0 |
Total liabilities assumed |
| 263\u00a0 |
Net identifiable assets acquired |
| 154\u00a0 |
Goodwill |
| 534\u00a0 |
Net assets acquired | $ | 688\u00a0 |
|
|
|
|
|
|
Cash | $ | 32,314\u00a0 |
Estimated initial contingent consideration |
| 6,290\u00a0 |
Total | $ | 38,604\u00a0 |
|
|
|
Cash and cash equivalents | $ | 2,056\u00a0 |
Accounts receivable |
| 3,299\u00a0 |
Prepaid expenses and other current assets |
| 116\u00a0 |
Intangible assets: |
|
|
Backlog (17 months useful life) |
| 1,210\u00a0 |
Customer relationships (7 years useful life) |
| 9,300\u00a0 |
Trademarks (3 years useful life) |
| 570\u00a0 |
Property and equipment |
| 117\u00a0 |
Total identifiable assets |
| 16,668\u00a0 |
Accounts payable |
| 305\u00a0 |
Accrued expenses and other current liabilities |
| 712\u00a0 |
Total liabilities assumed |
| 1,017\u00a0 |
Net identifiable assets acquired |
| 15,651\u00a0 |
Goodwill |
| 22,953\u00a0 |
Net assets acquired | $ | 38,604\u00a0 |
4.\u00a0Intangible Assets and Goodwill
The following table presents details of the Company\u2019s intangible assets, estimated lives and related accumulated amortization (dollars in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| As of May 29, 2021 |
|
|
|
| As of May 30, 2020 | ||||||||||||||||||||||
|
|
|
|
| Accumulated |
|
|
|
|
|
|
|
|
|
|
|
| Accumulated |
|
|
|
| ||||||
| Gross |
|
|
| Amortization |
|
|
| Net |
|
|
|
| Gross |
|
|
| Amortization |
|
|
| Net | ||||||
Customer contracts and relationships (3-8 years) | $ | 23,941 |
|
|
| $ | (9,918) |
|
|
| $ | 14,023 |
|
|
|
| $ | 23,779 |
|
|
| $ | (6,707) |
|
|
| $ | 17,072 |
Tradenames (3-10 years) |
| 5,164 |
|
|
|
| (3,651) |
|
|
|
| 1,513 |
|
|
|
|
| 4,960 |
|
|
|
| (2,735) |
|
|
|
| 2,225 |
Backlog (17 months) |
| 1,210 |
|
|
|
| (1,210) |
|
|
|
| - |
|
|
|
|
| 1,210 |
|
|
|
| (694) |
|
|
|
| 516 |
Consultant list (3 years) |
| 849 |
|
|
|
| (849) |
|
|
|
| - |
|
|
|
|
| 776 |
|
|
|
| (718) |
|
|
|
| 58 |
Non-compete agreements (3 years) |
| 970 |
|
|
|
| (970) |
|
|
|
| - |
|
|
|
|
| 888 |
|
|
|
| (821) |
|
|
|
| 67 |
Computer software (2-3.5 years) |
| 5,446 |
|
|
|
| (742) |
|
|
|
| 4,704 |
|
|
|
|
| 185 |
|
|
|
| (46) |
|
|
|
| 139 |
Total | $ | 37,580 |
|
|
| $ | (17,340) |
|
|
| $ | 20,240 |
|
|
|
| $ | 31,798 |
|
|
| $ | (11,721) |
|
|
| $ | 20,077 |
The weighted-average useful lives of the customer contracts and relationships, tradenames, backlog, and computer software are approximately 7.2 years, 5.8 years, 1.4 years, and 3.3 years, respectively. The weighted-average useful life of all of the Company\u2019s intangible assets is 6.2 years.
The Company recorded amortization expense of $5.2 million, $5.7 million, and $3.8 million for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively. The following table presents future estimated amortization expense based on existing intangible assets (in thousands):
|
|
|
2022 | $ | 4,399 |
2023 |
| 4,190 |
2024 |
| 3,986 |
2025 |
| 3,123 |
2026 |
| 2,330 |
Total | $ | 18,028 |
As further described in Note 18 \u2013 Segment Information and Enterprise Reporting, the Company changed its segment reporting effective in the second quarter of fiscal 2021, and reallocated goodwill to the new reporting units on the relative fair value basis. Concurrent with the segment change, the Company completed a goodwill impairment assessment, and concluded that no goodwill impairment existed immediately before or after the change in segment reporting.
The following table summarizes the activity in the Company\u2019s goodwill balance. The prior year information was recast to reflect the impact of the preceding segment change. Amounts are in thousands.
|
|
|
|
|
|
|
|
|
|
|
| RGP |
|
| Other Segments |
|
| Total Company | |||
Balance as of May 25, 2019 | $ | 186,170 |
|
| $ | 4,645 |
|
| $ | 190,815 |
Acquisitions (see Note 3) |
| 22,953 |
|
|
| 534 |
|
|
| 23,487 |
Impact of foreign currency exchange rate changes |
| (165) |
|
|
| (70) |
|
|
| (235) |
Balance as of May 30, 2020 | $ | 208,958 |
|
| $ | 5,109 |
|
| $ | 214,067 |
Impact of foreign currency exchange rate changes |
| 430 |
|
|
| 2,261 |
|
|
| 2,691 |
Balance as of May 29, 2021 | $ | 209,388 |
|
| $ | 7,370 |
|
| $ | 216,758 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| As of May 29, 2021 |
|
|
|
| As of May 30, 2020 | ||||||||||||||||||||||
|
|
|
|
| Accumulated |
|
|
|
|
|
|
|
|
|
|
|
| Accumulated |
|
|
|
| ||||||
| Gross |
|
|
| Amortization |
|
|
| Net |
|
|
|
| Gross |
|
|
| Amortization |
|
|
| Net | ||||||
Customer contracts and relationships (3-8 years) | $ | 23,941 |
|
|
| $ | (9,918) |
|
|
| $ | 14,023 |
|
|
|
| $ | 23,779 |
|
|
| $ | (6,707) |
|
|
| $ | 17,072 |
Tradenames (3-10 years) |
| 5,164 |
|
|
|
| (3,651) |
|
|
|
| 1,513 |
|
|
|
|
| 4,960 |
|
|
|
| (2,735) |
|
|
|
| 2,225 |
Backlog (17 months) |
| 1,210 |
|
|
|
| (1,210) |
|
|
|
| - |
|
|
|
|
| 1,210 |
|
|
|
| (694) |
|
|
|
| 516 |
Consultant list (3 years) |
| 849 |
|
|
|
| (849) |
|
|
|
| - |
|
|
|
|
| 776 |
|
|
|
| (718) |
|
|
|
| 58 |
Non-compete agreements (3 years) |
| 970 |
|
|
|
| (970) |
|
|
|
| - |
|
|
|
|
| 888 |
|
|
|
| (821) |
|
|
|
| 67 |
Computer software (2-3.5 years) |
| 5,446 |
|
|
|
| (742) |
|
|
|
| 4,704 |
|
|
|
|
| 185 |
|
|
|
| (46) |
|
|
|
| 139 |
Total | $ | 37,580 |
|
|
| $ | (17,340) |
|
|
| $ | 20,240 |
|
|
|
| $ | 31,798 |
|
|
| $ | (11,721) |
|
|
| $ | 20,077 |
|
|
|
2022 | $ | 4,399 |
2023 |
| 4,190 |
2024 |
| 3,986 |
2025 |
| 3,123 |
2026 |
| 2,330 |
Total | $ | 18,028 |
|
|
|
|
|
|
|
|
|
|
|
| RGP |
|
| Other Segments |
|
| Total Company | |||
Balance as of May 25, 2019 | $ | 186,170 |
|
| $ | 4,645 |
|
| $ | 190,815 |
Acquisitions (see Note 3) |
| 22,953 |
|
|
| 534 |
|
|
| 23,487 |
Impact of foreign currency exchange rate changes |
| (165) |
|
|
| (70) |
|
|
| (235) |
Balance as of May 30, 2020 | $ | 208,958 |
|
| $ | 5,109 |
|
| $ | 214,067 |
Impact of foreign currency exchange rate changes |
| 430 |
|
|
| 2,261 |
|
|
| 2,691 |
Balance as of May 29, 2021 | $ | 209,388 |
|
| $ | 7,370 |
|
| $ | 216,758 |
Property and equipment consist of the following (in thousands):
\u00a0
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, 2021 |
| May 30, 2020 | ||
Building and land |
| $ | 14,244 |
| $ | 14,244 |
Computers, equipment and software |
|
| 16,540 |
|
| 18,102 |
Leasehold improvements |
|
| 15,609 |
|
| 19,903 |
Furniture |
|
| 9,157 |
|
| 10,256 |
|
|
| 55,550 |
|
| 62,505 |
Less: accumulated depreciation and amortization |
|
| (35,007) |
|
| (38,861) |
|
| $ | 20,543 |
| $ | $ 23,644 |
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, 2021 |
| May 30, 2020 | ||
Building and land |
| $ | 14,244 |
| $ | 14,244 |
Computers, equipment and software |
|
| 16,540 |
|
| 18,102 |
Leasehold improvements |
|
| 15,609 |
|
| 19,903 |
Furniture |
|
| 9,157 |
|
| 10,256 |
|
|
| 55,550 |
|
| 62,505 |
Less: accumulated depreciation and amortization |
|
| (35,007) |
|
| (38,861) |
|
| $ | 20,543 |
| $ | $ 23,644 |
Lease cost components included within selling, general and administrative expenses in the Consolidated Statements of Operations were as follows (in thousands):
|
|
|
|
|
|
|
| For the Years Ended | |||||
| May 29, 2021 |
|
| May 30, 2020 | ||
Operating lease cost | $ | 10,604 |
|
| $ | 12,308 |
Short-term lease cost |
| 202 |
|
|
| 345 |
Variable lease cost |
| 2,585 |
|
|
| 2,808 |
Sublease income |
| (913) |
|
|
| (610) |
Total lease cost | $ | 12,478 |
|
| $ | 14,851 |
The weighted average lease terms and discount rates for operating leases are presented in the following table:
|
|
|
|
|
|
|
| As of |
|
| As of | ||
| May 29, 2021 |
|
| May 30, 2020 | ||
Weighted average remaining lease term |
| 3.7 years |
|
|
| 4.3 years |
Weighted average discount rate |
| 3.92% |
|
|
| 4.09% |
Cash flow and other information related to operating leases is included in the following table (in thousands):
|
|
|
|
|
|
|
| For the Years Ended | |||||
| May 29, 2021 |
|
| May 30, 2020 | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 13,206 |
|
| $ | 13,311 |
Right-of-use assets obtained in exchange for new operating lease obligations | $ | 2,235 |
|
| $ | 3,452 |
Future maturities of operating lease liabilities at May 29, 2021 are presented in the following table (in thousands):
|
|
|
Years Ending: | Operating Lease Maturity | |
May 28, 2022 | $ | 11,167 |
May 27, 2023 |
| 8,878 |
May 25, 2024 |
| 6,980 |
May 31, 2025 |
| 3,117 |
May 30, 2026 |
| 1,577 |
Thereafter |
| 1,496 |
Total minimum payments | $ | 33,215 |
Less: interest |
| (2,269) |
Present value of operating lease liabilities | $ | 30,946 |
The Company leases approximately 13,000\u00a0square feet of the approximately 57,000\u00a0square feet of a Company owned building located in Irvine, California to independent third parties and has operating lease agreements for sublet space with independent third parties expiring through fiscal 2025. Rental income received for the years ended May 29, 2021, May 30, 2020 and May 25, 2019 totaled $162,000, $210,000 and $240,000, respectively. Under the terms of these operating lease agreements, rental income from such third-party leases is expected to be $199,000, $219,000, $219,000 and $77,000 in fiscal 2022 through 2025, respectively."}]},{"name":"rpt:f-653","factDimensions":{"xbrl:concept":"us-gaap:LeaseCostTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
| For the Years Ended | |||||
| May 29, 2021 |
|
| May 30, 2020 | ||
Operating lease cost | $ | 10,604 |
|
| $ | 12,308 |
Short-term lease cost |
| 202 |
|
|
| 345 |
Variable lease cost |
| 2,585 |
|
|
| 2,808 |
Sublease income |
| (913) |
|
|
| (610) |
Total lease cost | $ | 12,478 |
|
| $ | 14,851 |
|
|
|
|
|
|
|
| As of |
|
| As of | ||
| May 29, 2021 |
|
| May 30, 2020 | ||
Weighted average remaining lease term |
| 3.7 years |
|
|
| 4.3 years |
Weighted average discount rate |
| 3.92% |
|
|
| 4.09% |
|
|
|
|
|
|
|
| For the Years Ended | |||||
| May 29, 2021 |
|
| May 30, 2020 | ||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 13,206 |
|
| $ | 13,311 |
Right-of-use assets obtained in exchange for new operating lease obligations | $ | 2,235 |
|
| $ | 3,452 |
|
|
|
Years Ending: | Operating Lease Maturity | |
May 28, 2022 | $ | 11,167 |
May 27, 2023 |
| 8,878 |
May 25, 2024 |
| 6,980 |
May 31, 2025 |
| 3,117 |
May 30, 2026 |
| 1,577 |
Thereafter |
| 1,496 |
Total minimum payments | $ | 33,215 |
Less: interest |
| (2,269) |
Present value of operating lease liabilities | $ | 30,946 |
Pursuant to the terms of the Credit Agreement, dated October 17, 2016, between the Company and Resources Connection LLC, as borrowers, and Bank of America, N.A. as lender (as amended, the \u201cCredit Agreement\u201d), the Company has a $120.0 million Facility with Bank of America, which until September 3, 2020, consisted of (i) a $90.0 million revolving loan facility (\u201cRevolving Commitment\u201d), which included a $5.0 million sublimit for the issuance of standby letters of credit, and (ii) a $30.0 million reducing revolving loan facility (\u201cReducing Revolving Commitment\u201d), any amounts of which may not be reborrowed after being repaid. The Company and Resources Connection LLC, as borrowers, entered into the Fifth Amendment to the Credit Agreement (the \u201cFifth Amendment\u201d) with Bank of America, N.A. as lender on September 3, 2020, and the Sixth Amendment to the Credit Agreement (the
\u201cSixth Amendment\u201d) with Bank of America, N.A. as lender on May 25, 2021, both of which amended the terms of the Facility. The Fifth Amendment, among other things, (1) eliminated the $30.0 million Reducing Revolving Commitment and (2) increased the Revolving Commitment by $30.0 million to $120.0 million. The Sixth Amendment, among other things, (1) further revised the definition of Consolidated EBITDA in the Credit Agreement to include addbacks for certain restructuring costs (2) included customary provisions relating to the transition from LIBOR as the benchmark interest rate under the Credit Agreement, including providing for a Benchmark Replacement option (as defined in the Credit Agreement) to replace LIBOR, and (3) decreased the interest rate floor as described below.
Borrowings under the Facility bear interest at a rate per annum of either, at the Company\u2019s option, (i) a London Interbank Offered Rate (\u201cLIBOR\u201d) defined in the Facility plus a margin or (ii) an alternate base rate, plus a margin, with the applicable margin depending on the Company\u2019s consolidated leverage ratio. The alternate base rate is the highest of (i) Bank of America\u2019s prime rate, (ii) the federal funds rate plus 0.50% and (iii) the Eurodollar rate plus 1.0%. Prior to entering into the Fifth Amendment, the margin for loans based on LIBOR was 1.25% to 1.50%, the margin for loans based on the alternate base rate was 0.25% to 0.50%, and the LIBOR interest rate floor was 0%. Effective upon entering into the Fifth Amendment, the applicable margin increased by 0.25% and the LIBOR interest rate floor increased to 0.25%. Effective upon entering into the Sixth Amendment, the LIBOR interest rate floor was removed and reverted to 0%. The Company pays an unused commitment fee on the average daily unused portion of the Facility, which, prior to entering into the Fifth Amendment, was a rate of 0.15% to 0.25% per annum depending on the Company\u2019s consolidated leverage ratio and, effective upon entering into the Fifth Amendment, is 0.25% per annum. The unused commitment fee remains at 0.25% per annum under the Sixth Amendment.
The Facility is available for working capital and general corporate purposes, including potential acquisitions and stock repurchases. The Company\u2019s obligations under the Facility are guaranteed by all of the Company\u2019s domestic subsidiaries and certain foreign subsidiaries, and secured by essentially all assets of the Company, Resources Connection LLC and their respective domestic and foreign subsidiaries, subject to certain customary exclusions. The Facility expires on October 17, 2022.
The Facility contains both affirmative and negative covenants. Covenants include, but are not limited to, limitations on the Company\u2019s and its subsidiaries\u2019 ability to incur liens, incur additional indebtedness, make certain restricted payments, merge or consolidate and make dispositions of assets. In addition, the Facility requires the Company to comply with financial covenants limiting the Company\u2019s total funded debt, minimum interest coverage ratio and maximum leverage ratio. The Company was compliant with all financial covenants under the Facility as of May 29, 2021.
Upon the occurrence of an event of default under the Facility, the lender may cease making loans, terminate the Facility and declare all amounts outstanding to be immediately due and payable. The Facility specifies a number of events of default (some of which are subject to applicable grace or cure periods), including, among other things, non-payment defaults, covenant defaults, cross-defaults to other material indebtedness, bankruptcy and insolvency defaults and material judgment defaults.
The Company\u2019s borrowings under the Facility were $43.0 million and $88.0 million as of May 29, 2021 and May 30, 2020, respectively. In addition, the Company had $1.3 million of outstanding letters of credit issued under the Facility as of both May 29, 2021 and May 30, 2020. As of May 29, 2021, there was $75.7 million remaining capacity under the Facility, and the interest rate on the Company\u2019s borrowings under the Facility was 1.93%.
\u00a0"}]},{"name":"rpt:f-694","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"120000000.0","decimals":-6}]},{"name":"rpt:f-695","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"90000000.0","decimals":-6}]},{"name":"rpt:f-696","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:LetterOfCreditMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"5000000.0","decimals":-6}]},{"name":"rpt:f-697","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"rgp:ReducingRevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"30000000.0","decimals":-6}]},{"name":"rpt:f-698","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"rgp:ReducingRevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"30000000.0","decimals":-5}]},{"name":"rpt:f-699","factDimensions":{"xbrl:concept":"rgp:LineOfCreditFacilityIncreaseDecreaseInMaximumBorrowingCapacity","xbrl:period":"2020-09-04T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"30000000.0","decimals":-5}]},{"name":"rpt:f-700","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityMaximumBorrowingCapacity","xbrl:period":"2020-09-04T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"120000000.0","decimals":-5}]},{"name":"rpt:f-701","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:FederalFundsEffectiveSwapRateMember"},"factValues":[{"value":"0.0050"}]},{"name":"rpt:f-702","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:EurodollarMember"},"factValues":[{"value":"0.010"}]},{"name":"rpt:f-703","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MinimumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:LondonInterbankOfferedRateLIBORMember"},"factValues":[{"value":"0.0125"}]},{"name":"rpt:f-704","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MaximumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:LondonInterbankOfferedRateLIBORMember"},"factValues":[{"value":"0.0150"}]},{"name":"rpt:f-705","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MinimumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:BaseRateMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-706","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentBasisSpreadOnVariableRate1","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MaximumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:BaseRateMember"},"factValues":[{"value":"0.0050"}]},{"name":"rpt:f-707","factDimensions":{"xbrl:concept":"rgp:DebtInstrumentInterestRateFloor","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:LondonInterbankOfferedRateLIBORMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-708","factDimensions":{"xbrl:concept":"rgp:DebtInstrumentIncreaseDecreaseInVariableInterestRate","xbrl:period":"2020-09-03T00:00:00/2020-09-04T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-709","factDimensions":{"xbrl:concept":"rgp:DebtInstrumentInterestRateFloorIncreaseDecrease","xbrl:period":"2020-09-03T00:00:00/2020-09-04T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:LondonInterbankOfferedRateLIBORMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-710","factDimensions":{"xbrl:concept":"rgp:DebtInstrumentInterestRateFloor","xbrl:period":"2021-05-25T00:00:00/2021-05-26T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:VariableRateAxis":"us-gaap:LondonInterbankOfferedRateLIBORMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-711","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityCommitmentFeePercentage","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MinimumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0015"}]},{"name":"rpt:f-712","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityCommitmentFeePercentage","xbrl:period":"2020-09-02T00:00:00/2020-09-03T00:00:00","xbrl:entity":"cik:0001084765","srt:RangeAxis":"srt:MaximumMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-713","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityCommitmentFeePercentage","xbrl:period":"2020-09-03T00:00:00/2020-09-04T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-714","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityCommitmentFeePercentage","xbrl:period":"2021-05-25T00:00:00/2021-05-26T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0025"}]},{"name":"rpt:f-715","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityExpirationDate1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"2022-10-17"}]},{"name":"rpt:f-716","factDimensions":{"xbrl:concept":"us-gaap:LineOfCredit","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"43000000.0","decimals":-5}]},{"name":"rpt:f-717","factDimensions":{"xbrl:concept":"us-gaap:LineOfCredit","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"88000000.0","decimals":-5}]},{"name":"rpt:f-718","factDimensions":{"xbrl:concept":"us-gaap:LineOfCredit","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:LetterOfCreditMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"1300000","decimals":-5}]},{"name":"rpt:f-719","factDimensions":{"xbrl:concept":"us-gaap:LineOfCredit","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:LetterOfCreditMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"1300000","decimals":-5}]},{"name":"rpt:f-720","factDimensions":{"xbrl:concept":"us-gaap:LineOfCreditFacilityRemainingBorrowingCapacity","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:CreditFacilityAxis":"us-gaap:RevolvingCreditFacilityMember","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"75700000","decimals":-5}]},{"name":"rpt:f-721","factDimensions":{"xbrl:concept":"us-gaap:DebtInstrumentInterestRateEffectivePercentage","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember"},"factValues":[{"value":"0.0193","decimals":4}]},{"name":"rpt:f-722","factDimensions":{"xbrl:concept":"us-gaap:IncomeTaxDisclosureTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"8.\u00a0Income Taxes
The following table represents the current and deferred income tax (benefit) provision for federal, state and foreign income taxes attributable to operations (in thousands):
\u00a0
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Current |
|
|
|
|
|
|
|
|
|
Federal |
| $ | (19,790) |
| $ | 3,038 |
| $ | 5,068 |
State |
|
| 3,256 |
|
| 1,302 |
|
| 2,278 |
Foreign |
|
| 1,769 |
|
| 1,686 |
|
| 2,690 |
|
|
| (14,765) |
|
| 6,026 |
|
| 10,036 |
Deferred |
|
|
|
|
|
|
|
|
|
Federal |
|
| 13,509 |
|
| 874 |
|
| 5,890 |
State |
|
| (1,341) |
|
| 245 |
|
| 619 |
Foreign |
|
| 52 |
|
| (202) |
|
| (46) |
|
|
| 12,220 |
|
| 917 |
|
| 6,463 |
|
| $ | (2,545) |
| $ | 6,943 |
| $ | 16,499 |
Income before income tax (benefit) expense is as follows (in thousands):
\u00a0
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Domestic |
| $ | 23,598 |
| $ | 36,148 |
| $ | 41,828 |
Foreign |
|
| (914) |
|
| (920) |
|
| 6,141 |
|
| $ | 22,684 |
| $ | 35,228 |
| $ | 47,969 |
The income tax (benefit) expense differs from the amount that would result from applying the federal statutory rate as follows:
\u00a0
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Statutory tax rate |
| 21.0 | % |
| 21.0 | % |
| 21.0 | % |
State taxes, net of federal benefit |
| 9.0 |
|
| 3.6 |
|
| 4.9 |
|
Non-U.S. rate adjustments |
| 3.1 |
|
| 0.9 |
|
| 1.3 |
|
Stock-based compensation |
| 6.0 |
|
| 3.2 |
|
| 2.8 |
|
Long-term net capital gains |
| - |
|
| - |
|
| (6.1) |
|
Foreign tax credit |
| - |
|
| - |
|
| 9.3 |
|
Valuation allowance |
| 7.8 |
|
| 4.1 |
|
| (2.8) |
|
Global Intangible Low-Taxed Income (\u201cGILTI\u201d) |
| - |
|
| 0.9 |
|
| 1.1 |
|
Worthless Stock Deduction |
| - |
|
| (14.8) |
|
| - |
|
Worthless Debt Deduction |
| - |
|
| (2.6) |
|
| - |
|
FIN48 |
| 0.1 |
|
| 1.6 |
|
| - |
|
Permanent items, primarily meals and entertainment |
| 0.8 |
|
| 2.0 |
|
| 1.4 |
|
Deferred tax impact of U.S. federal rate changes |
| - |
|
| - |
|
| 0.1 |
|
Deferred tax impact of foreign rate changes |
| (1.9) |
|
| (0.2) |
|
| 1.2 |
|
Prior year true-ups |
| (3.8) |
|
| - |
|
| - |
|
Prior year interest and penalty |
| 3.1 |
|
| - |
|
| - |
|
Federal rate benefit on NOL carryback |
| (56.3) |
|
| - |
|
| - |
|
Other, net |
| (0.1) |
|
| - |
|
| 0.2 |
|
Effective tax rate |
| (11.2) | % |
| 19.7 | % |
| 34.4 | % |
The impact of state taxes, net of federal benefit, and foreign income taxed at other than U.S.\u00a0rates fluctuates year over year due to the changes in the mix of operating income and losses amongst the various states and foreign jurisdictions in which the Company operates.
The components of the net deferred tax asset (liability) consist of the following (in thousands):
\u00a0
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Deferred tax assets: |
|
|
|
|
|
|
Allowance for doubtful accounts |
| $ | 268 |
| $ | 1,158 |
Accrued compensation |
|
| 4,567 |
|
| 3,716 |
Accrued expenses |
|
| 4,495 |
|
| 2,652 |
Stock options and restricted stock |
|
| 4,435 |
|
| 4,870 |
Foreign tax credit |
|
| 557 |
|
| 567 |
Net operating losses |
|
| 16,931 |
|
| 12,018 |
State taxes |
|
| 210 |
|
| 70 |
Property and equipment |
|
| 410 |
|
| - |
Gross deferred tax asset |
|
| 31,873 |
|
| 25,051 |
Valuation allowance |
|
| (13,263) |
|
| (11,069) |
Gross deferred tax asset, net of valuation allowance |
|
| 18,610 |
|
| 13,982 |
Deferred tax liabilities: |
|
|
|
|
|
|
Property and equipment |
|
| - |
|
| (547) |
Outside basis difference - Sweden investment |
|
| (259) |
|
| (263) |
IRC Section 481(a) adjustment |
|
| (16,786) |
|
| - |
Goodwill and intangibles |
|
| (18,256) |
|
| (17,790) |
Net deferred tax liability |
| $ | (16,691) |
| $ | (4,618) |
In March 2020, the CARES Act was enacted into law. The CARES Act made various tax law changes, including among other things (i) enacting technical corrections so that qualified improvement property can be immediately expensed under IRC Section 168(k) and (ii) allowing federal net operating losses (\u201cNOLs\u201d) incurred in calendar year 2018 to 2020 (RGP\u2019s fiscal years 2019, 2020 and 2021) to be carried back to the five preceding taxable years. The NOL carryback is intended to generate tax benefits at higher tax rates in the carryback periods. As part of the Company\u2019s tax planning strategies, management made certain changes related to the capitalization of fixed assets effective in fiscal 2021. The strategy allowed the Company to carry back the net operating losses of fiscal 2021 to fiscal years 2016 to 2018. The Company recognized a discrete tax benefit of $12.8 million in the fourth quarter of fiscal 2021.
The Company had a net income tax receivable of $36.1 million as of May 29, 2021 and $3.5 million as of May 30, 2020, respectively.
The tax benefit associated with the exercise of nonqualified stock options, disqualifying dispositions by employees of shares acquired pursuant to incentive stock options or under the Company\u2019s ESPP, and the grant of restricted stock awards and restricted stock units reduced income taxes payable by $0.4 million and $0.9 million for the years ended May 29, 2021 and May 30, 2020, respectively.
The Company has foreign net operating loss carryforwards of $59.1 million and foreign tax credit carryforwards of $0.6 million. The foreign tax credits will expire beginning in fiscal 2023. The following table summarizes the net operating loss expiration periods.
|
|
|
Expiration Periods | Amount of Net Operating Losses | |
Fiscal Years Ending: | (in thousands) | |
2022 | $ | 89 |
2023 |
| 139 |
2024 |
| 2,511 |
2025 |
| 593 |
2026 |
| 621 |
2027-2031 |
| 2,524 |
Unlimited |
| 52,587 |
| $ | 59,064 |
The following table summarizes the activity in the Company\u2019s valuation allowance accounts (in thousands):
\u00a0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Currency |
|
|
| |
|
| Beginning |
| Charged to |
| Rate |
| Ending | ||||
|
| Balance |
| Operations |
| Changes |
| Balance | ||||
Years Ended: |
|
|
|
|
|
|
|
|
|
|
|
|
May 25, 2019 |
| $ | 15,298 |
| $ | (1,440) |
| $ | (668) |
| $ | 13,190 |
May 30, 2020 |
| $ | 13,190 |
| $ | (1,919) |
| $ | (202) |
| $ | 11,069 |
May 29, 2021 |
| $ | 11,069 |
| $ | 951 |
| $ | 1,243 |
| $ | 13,263 |
Realization of deferred tax assets is dependent upon generating sufficient future taxable income. Management believes that it is more likely than not that all remaining deferred tax assets will be realized through future taxable earnings or alternative tax strategies.
Deferred income taxes have not been provided on the undistributed earnings of approximately $23.7\u00a0million from the Company\u2019s foreign subsidiaries as of May 29, 2021 since these amounts are intended to be indefinitely reinvested in foreign operations. If the earnings of the Company\u2019s foreign subsidiaries were to be distributed, management estimates that the income tax impact would be immaterial as a result of the transition tax and federal dividends received deduction for foreign source earnings provided under the US Tax Cuts and Jobs Act of 2017.
The following table summarizes the activity related to the gross unrecognized tax benefits (in thousands):
|
|
|
|
|
|
|
|
| For the Years Ended | ||||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Unrecognized tax benefits, beginning of year |
| $ | 848 |
| $ | 42 |
Gross increases (decreases)-tax positions in prior period |
|
| 24 |
|
| (42) |
Gross increases-tax positions in current period |
|
| - |
|
| 848 |
Unrecognized tax benefits, end of year |
| $ | 872 |
| $ | 848 |
The Company\u2019s total liability for unrecognized gross tax benefits was $872,000 and $848,000 as of May 29, 2021 and May 30, 2020, respectively, which, if ultimately recognized, would impact the effective tax rate in future periods. The unrecognized tax benefits are included in long-term liabilities in the Consolidated Balance Sheets. None of the unrecognized tax benefits are short-term liabilities due to the closing of the statute of limitations.
The Company\u2019s major income tax jurisdiction is the U.S., with federal statutes of limitations remaining open for fiscal 2018 and thereafter. For states within the U.S.\u00a0in which the Company does significant business, the Company remains subject to examination for fiscal 2017 and thereafter. Major foreign jurisdictions in Europe remain open for fiscal years ended 2016 and thereafter.
The Company recognizes interest and penalties related to unrecognized tax benefits as a part of its provision for income taxes. During the fiscal year ended May 29, 2021, the Company accrued for interest of $24,000 as a component of the liability for unrecognized tax benefits."}]},{"name":"rpt:f-723","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfComponentsOfIncomeTaxExpenseBenefitTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Current |
|
|
|
|
|
|
|
|
|
Federal |
| $ | (19,790) |
| $ | 3,038 |
| $ | 5,068 |
State |
|
| 3,256 |
|
| 1,302 |
|
| 2,278 |
Foreign |
|
| 1,769 |
|
| 1,686 |
|
| 2,690 |
|
|
| (14,765) |
|
| 6,026 |
|
| 10,036 |
Deferred |
|
|
|
|
|
|
|
|
|
Federal |
|
| 13,509 |
|
| 874 |
|
| 5,890 |
State |
|
| (1,341) |
|
| 245 |
|
| 619 |
Foreign |
|
| 52 |
|
| (202) |
|
| (46) |
|
|
| 12,220 |
|
| 917 |
|
| 6,463 |
|
| $ | (2,545) |
| $ | 6,943 |
| $ | 16,499 |
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Domestic |
| $ | 23,598 |
| $ | 36,148 |
| $ | 41,828 |
Foreign |
|
| (914) |
|
| (920) |
|
| 6,141 |
|
| $ | 22,684 |
| $ | 35,228 |
| $ | 47,969 |
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
| May 29, |
| May 30, |
| May 25, | |||
|
| 2021 |
| 2020 |
| 2019 | |||
Statutory tax rate |
| 21.0 | % |
| 21.0 | % |
| 21.0 | % |
State taxes, net of federal benefit |
| 9.0 |
|
| 3.6 |
|
| 4.9 |
|
Non-U.S. rate adjustments |
| 3.1 |
|
| 0.9 |
|
| 1.3 |
|
Stock-based compensation |
| 6.0 |
|
| 3.2 |
|
| 2.8 |
|
Long-term net capital gains |
| - |
|
| - |
|
| (6.1) |
|
Foreign tax credit |
| - |
|
| - |
|
| 9.3 |
|
Valuation allowance |
| 7.8 |
|
| 4.1 |
|
| (2.8) |
|
Global Intangible Low-Taxed Income (\u201cGILTI\u201d) |
| - |
|
| 0.9 |
|
| 1.1 |
|
Worthless Stock Deduction |
| - |
|
| (14.8) |
|
| - |
|
Worthless Debt Deduction |
| - |
|
| (2.6) |
|
| - |
|
FIN48 |
| 0.1 |
|
| 1.6 |
|
| - |
|
Permanent items, primarily meals and entertainment |
| 0.8 |
|
| 2.0 |
|
| 1.4 |
|
Deferred tax impact of U.S. federal rate changes |
| - |
|
| - |
|
| 0.1 |
|
Deferred tax impact of foreign rate changes |
| (1.9) |
|
| (0.2) |
|
| 1.2 |
|
Prior year true-ups |
| (3.8) |
|
| - |
|
| - |
|
Prior year interest and penalty |
| 3.1 |
|
| - |
|
| - |
|
Federal rate benefit on NOL carryback |
| (56.3) |
|
| - |
|
| - |
|
Other, net |
| (0.1) |
|
| - |
|
| 0.2 |
|
Effective tax rate |
| (11.2) | % |
| 19.7 | % |
| 34.4 | % |
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Deferred tax assets: |
|
|
|
|
|
|
Allowance for doubtful accounts |
| $ | 268 |
| $ | 1,158 |
Accrued compensation |
|
| 4,567 |
|
| 3,716 |
Accrued expenses |
|
| 4,495 |
|
| 2,652 |
Stock options and restricted stock |
|
| 4,435 |
|
| 4,870 |
Foreign tax credit |
|
| 557 |
|
| 567 |
Net operating losses |
|
| 16,931 |
|
| 12,018 |
State taxes |
|
| 210 |
|
| 70 |
Property and equipment |
|
| 410 |
|
| - |
Gross deferred tax asset |
|
| 31,873 |
|
| 25,051 |
Valuation allowance |
|
| (13,263) |
|
| (11,069) |
Gross deferred tax asset, net of valuation allowance |
|
| 18,610 |
|
| 13,982 |
Deferred tax liabilities: |
|
|
|
|
|
|
Property and equipment |
|
| - |
|
| (547) |
Outside basis difference - Sweden investment |
|
| (259) |
|
| (263) |
IRC Section 481(a) adjustment |
|
| (16,786) |
|
| - |
Goodwill and intangibles |
|
| (18,256) |
|
| (17,790) |
Net deferred tax liability |
| $ | (16,691) |
| $ | (4,618) |
|
|
|
Expiration Periods | Amount of Net Operating Losses | |
Fiscal Years Ending: | (in thousands) | |
2022 | $ | 89 |
2023 |
| 139 |
2024 |
| 2,511 |
2025 |
| 593 |
2026 |
| 621 |
2027-2031 |
| 2,524 |
Unlimited |
| 52,587 |
| $ | 59,064 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Currency |
|
|
| |
|
| Beginning |
| Charged to |
| Rate |
| Ending | ||||
|
| Balance |
| Operations |
| Changes |
| Balance | ||||
Years Ended: |
|
|
|
|
|
|
|
|
|
|
|
|
May 25, 2019 |
| $ | 15,298 |
| $ | (1,440) |
| $ | (668) |
| $ | 13,190 |
May 30, 2020 |
| $ | 13,190 |
| $ | (1,919) |
| $ | (202) |
| $ | 11,069 |
May 29, 2021 |
| $ | 11,069 |
| $ | 951 |
| $ | 1,243 |
| $ | 13,263 |
|
|
|
|
|
|
|
|
| For the Years Ended | ||||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Unrecognized tax benefits, beginning of year |
| $ | 848 |
| $ | 42 |
Gross increases (decreases)-tax positions in prior period |
|
| 24 |
|
| (42) |
Gross increases-tax positions in current period |
|
| - |
|
| 848 |
Unrecognized tax benefits, end of year |
| $ | 872 |
| $ | 848 |
Accrued salaries and related obligations consist of the following (in thousands):
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Accrued salaries and related obligations |
| $ | 13,231 |
| $ | 14,795 |
Accrued bonuses |
|
| 19,968 |
|
| 17,897 |
Accrued vacation |
|
| 22,314 |
|
| 19,715 |
|
| $ | 55,513 |
| $ | 52,407 |
"}]},{"name":"rpt:f-872","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfAccountsPayableAndAccruedLiabilitiesTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
| As of |
| As of | ||
|
| May 29, |
| May 30, | ||
|
| 2021 |
| 2020 | ||
Accrued salaries and related obligations |
| $ | 13,231 |
| $ | 14,795 |
Accrued bonuses |
|
| 19,968 |
|
| 17,897 |
Accrued vacation |
|
| 22,314 |
|
| 19,715 |
|
| $ | 55,513 |
| $ | 52,407 |
The Company currently maintains cash and cash equivalents in commercial paper or money market accounts.
Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of trade receivables. However, concentrations of credit risk are limited due to the large number of customers comprising the Company\u2019s customer
base and their dispersion across different business and geographic areas. The Company monitors its exposure to credit losses and maintains an allowance for anticipated losses. A significant change in the liquidity or financial position of one or more of the Company\u2019s customers could result in an increase in the allowance for anticipated losses. No single customer accounted for more than 10% of revenue for the years ended May 29, 2021, May 30, 2020 and May 25, 2019. No single customer accounted for more than 10% of trade accounts receivable as of May 29, 2021 and May 30, 2020.
\u00a0"}]},{"name":"rpt:f-882","factDimensions":{"xbrl:concept":"rgp:ConcentrationOfCreditRiskNumberOfCustomers","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:customer","us-gaap:ConcentrationRiskByBenchmarkAxis":"us-gaap:SalesRevenueNetMember","us-gaap:ConcentrationRiskByTypeAxis":"us-gaap:CustomerConcentrationRiskMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-883","factDimensions":{"xbrl:concept":"rgp:ConcentrationOfCreditRiskNumberOfCustomers","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:customer","us-gaap:ConcentrationRiskByBenchmarkAxis":"us-gaap:SalesRevenueNetMember","us-gaap:ConcentrationRiskByTypeAxis":"us-gaap:CustomerConcentrationRiskMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-884","factDimensions":{"xbrl:concept":"rgp:ConcentrationOfCreditRiskNumberOfCustomers","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:customer","us-gaap:ConcentrationRiskByBenchmarkAxis":"us-gaap:SalesRevenueNetMember","us-gaap:ConcentrationRiskByTypeAxis":"us-gaap:CustomerConcentrationRiskMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-885","factDimensions":{"xbrl:concept":"rgp:ConcentrationOfCreditRiskNumberOfCustomers","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:customer","us-gaap:ConcentrationRiskByBenchmarkAxis":"us-gaap:TradeAccountsReceivableMember","us-gaap:ConcentrationRiskByTypeAxis":"us-gaap:CustomerConcentrationRiskMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-886","factDimensions":{"xbrl:concept":"rgp:ConcentrationOfCreditRiskNumberOfCustomers","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"rgp:customer","us-gaap:ConcentrationRiskByBenchmarkAxis":"us-gaap:TradeAccountsReceivableMember","us-gaap:ConcentrationRiskByTypeAxis":"us-gaap:CustomerConcentrationRiskMember"},"factValues":[{"value":"0"}]},{"name":"rpt:f-887","factDimensions":{"xbrl:concept":"us-gaap:StockholdersEquityNoteDisclosureTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"11.\u00a0Stockholders\u2019 Equity
The Company has authorized for issuance 5,000,000\u00a0shares of preferred stock with a $0.01\u00a0par value per share. The board of directors has the authority to issue preferred stock in one or more series and to determine the related rights and preferences. No shares of preferred stock were outstanding as of May 29, 2021 and May 30, 2020.
The Company has 70,000,000 authorized shares of common stock with a $0.01\u00a0par value. At May 29, 2021 and May 30, 2020, there were 32,885,000 and 32,144,000\u00a0shares of common stock outstanding, respectively, all of which provide the holders with voting rights.
Stock Repurchase Program
The Company\u2019s board of directors has periodically approved a stock repurchase program authorizing the repurchase, at the discretion of the Company\u2019s senior executives, of the Company\u2019s common stock for a designated aggregate dollar limit. The current program was authorized in July 2015 (the \u201cJuly 2015 Program\u201d) and set an aggregate dollar limit not to exceed $150 million. Subject to the aggregate dollar limit, the currently authorized stock repurchase program does not have an expiration date. Repurchases under the program may take place in the open market or in privately negotiated transactions and may be made pursuant to a Rule 10b5-1 plan. The Company did not purchase any share of its common stock during the year ended May 29, 2021. During the year ended May 30, 2020, the Company purchased on the open market approximately 0.3\u00a0million shares of its common stock at an average price $15.70 per share for approximately $5.0 million. As of May 29, 2021, approximately $85.1 million remained available for future repurchases of the Company\u2019s common stock under the July 2015 Program.
Quarterly Dividend
Subject to approval each quarter by its board of directors, the Company pays a regular dividend. On April 15, 2021, the board of directors declared a regular quarterly dividend of $0.14 per share of the Company\u2019s common stock. The dividend, paid on June 10, 2021 to holders of record as of May 13, 2021, was accrued in the Company\u2019s Consolidated Balance Sheet as of May 29, 2021 for $4.6 million. Continuation of the quarterly dividend is at the discretion of the board of directors and depends upon the Company\u2019s financial condition, results of operations, capital requirements, general business condition, contractual restrictions contained in the Company\u2019s current credit agreements and other agreements, and other factors deemed relevant by the board of directors."}]},{"name":"rpt:f-888","factDimensions":{"xbrl:concept":"us-gaap:PreferredStockSharesAuthorized","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"5000000"}]},{"name":"rpt:f-889","factDimensions":{"xbrl:concept":"us-gaap:PreferredStockParOrStatedValuePerShare","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"0.01"}]},{"name":"rpt:f-890","factDimensions":{"xbrl:concept":"us-gaap:PreferredStockSharesOutstanding","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"0"}]},{"name":"rpt:f-891","factDimensions":{"xbrl:concept":"us-gaap:PreferredStockSharesOutstanding","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"0"}]},{"name":"rpt:f-892","factDimensions":{"xbrl:concept":"us-gaap:CommonStockSharesAuthorized","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"70000000"}]},{"name":"rpt:f-893","factDimensions":{"xbrl:concept":"us-gaap:CommonStockParOrStatedValuePerShare","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"0.01"}]},{"name":"rpt:f-894","factDimensions":{"xbrl:concept":"us-gaap:CommonStockSharesOutstanding","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"32885000","decimals":0}]},{"name":"rpt:f-895","factDimensions":{"xbrl:concept":"us-gaap:CommonStockSharesOutstanding","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"32144000","decimals":0}]},{"name":"rpt:f-896","factDimensions":{"xbrl:concept":"us-gaap:StockRepurchaseProgramAuthorizedAmount1","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"150000000","decimals":-6}]},{"name":"rpt:f-897","factDimensions":{"xbrl:concept":"us-gaap:TreasuryStockSharesAcquired","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"0"}]},{"name":"rpt:f-898","factDimensions":{"xbrl:concept":"us-gaap:TreasuryStockSharesAcquired","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"300000","decimals":-5}]},{"name":"rpt:f-899","factDimensions":{"xbrl:concept":"us-gaap:TreasuryStockAcquiredAverageCostPerShare","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"15.70","decimals":2}]},{"name":"rpt:f-900","factDimensions":{"xbrl:concept":"us-gaap:TreasuryStockValueAcquiredCostMethod","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"5000000.0","decimals":-5}]},{"name":"rpt:f-901","factDimensions":{"xbrl:concept":"us-gaap:StockRepurchaseProgramRemainingAuthorizedRepurchaseAmount1","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:ShareRepurchaseProgramAxis":"rgp:ShareRepurchaseProgram2015Member"},"factValues":[{"value":"85100000","decimals":-5}]},{"name":"rpt:f-902","factDimensions":{"xbrl:concept":"us-gaap:DividendsPayableAmountPerShare","xbrl:period":"2021-06-11T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares","us-gaap:SubsequentEventTypeAxis":"us-gaap:SubsequentEventMember"},"factValues":[{"value":"0.14"}]},{"name":"rpt:f-903","factDimensions":{"xbrl:concept":"us-gaap:DividendsPayableCurrent","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"4600000","decimals":-5}]},{"name":"rpt:f-904","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"12. Revenue Recognition
The timing of revenue recognition, billings and cash collections affects the recognition of accounts receivable, contract assets and contract liabilities.\u00a0
Contract assets represent the Company\u2019s rights to consideration for completed performance under the contract (e.g., unbilled receivables), in which the Company has transferred control of the product or services before there is an unconditional right to payment. Contract assets were $36.2 million and $30.6 million as of May 29, 2021 and May 30, 2020, respectively, which were included in Accounts Receivable in the Consolidated Balance Sheets.
Contract liabilities represent deferred revenue when cash is received in advance of performance and are presented in Other Liabilities in the Consolidated Balance Sheets. Contract liabilities were $4.6 million and $2.9 million as of May 29, 2021 and May 30, 2020, respectively. The year over year increase of $1.7 million was primarily related to an increase in services credits earned by key clients. Revenues recognized during the year ended May 29, 2021 that were included in deferred revenues as of May 30, 2020 were $1.6 million. Revenues recognized during the year ended May 30, 2020 that were included in deferred revenues as of May 25, 2019 were $1.8 million.
"}]},{"name":"rpt:f-905","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerAssetNet","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"36200000","decimals":-5}]},{"name":"rpt:f-906","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerAssetNet","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"30600000","decimals":-5}]},{"name":"rpt:f-907","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerLiability","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"4600000","decimals":-5}]},{"name":"rpt:f-908","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerLiability","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"2900000","decimals":-5}]},{"name":"rpt:f-909","factDimensions":{"xbrl:concept":"us-gaap:IncreaseDecreaseInContractWithCustomerLiability","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"1700000","decimals":-5}]},{"name":"rpt:f-910","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerPerformanceObligationSatisfiedInPreviousPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"1600000","decimals":-5}]},{"name":"rpt:f-911","factDimensions":{"xbrl:concept":"us-gaap:ContractWithCustomerPerformanceObligationSatisfiedInPreviousPeriod","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"1800000","decimals":-5}]},{"name":"rpt:f-912","factDimensions":{"xbrl:concept":"us-gaap:RestructuringAndRelatedActivitiesDisclosureTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"13. \u00a0Restructuring Activities
The Company initiated its global restructuring and business transformation plan in North America and Asia Pacific (the \u201cNorth America and APAC Plan\u201d) in March 2020 and in Europe (the \u201cEuropean Plan\u201d and, together with the North America and APAC Plan, the \u201cRestructuring Plans\u201d) in September 2020. Both the North America and APAC Plan and the European Plan consisted of two key components: (i) an effort to streamline the management and organizational structure and eliminate certain positions as well as exit certain markets to focus on core solution offerings and high growth clients; and (ii) a strategic rationalization of the Company\u2019s physical
geographic footprint and real estate spend to focus investment dollars in high growth core markets for greater impact. In connection with the execution of the European Plan, the Company changed its internal management structure and its reporting structure of financial information used to assess performance and allocate resources during the second quarter of fiscal 2021. The Company revised its operating segments accordingly effective in the second quarter of fiscal 2021, resulting in a change to the Company\u2019s reportable segments into RGP and Other Segments. All of the employee termination and facility exit costs associated with the Company\u2019s restructuring initiatives are within its RGP segment, and are recorded in selling, general and administrative expenses in the Company\u2019s Consolidated Statements of Operations. Unpaid employee termination benefits were included in accounts payable and accrued expenses in the Company\u2019s Consolidated Balance Sheets. See further discussion about the Company\u2019s segment position in Note 2 \u2013 Summary of Significant Accounting Policies and Note 18 \u2013 Segment Information and Enterprise Reporting.
Restructuring costs for the years ended May 29, 2021 and May 30, 2020 were as follows (in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Year Ended May 29, 2021 | For the Year Ended May 30, 2020 | |||||||||||||||
|
| North America |
| European |
|
|
| North America |
| European |
|
| ||||||
|
| and APAC Plan |
| Plan |
| Total |
| and APAC Plan |
| Plan |
| Total | ||||||
Employee termination costs |
| $ | 1,024 |
| $ | 4,838 |
| $ | 5,862 |
| $ | 3,927 |
| $ | - |
| $ | 3,927 |
Real estate exit costs |
|
| 1,052 |
|
| 666 |
|
| 1,718 |
|
| 1,055 |
|
| - |
|
| 1,055 |
Other costs |
|
| - |
|
| 680 |
|
| 680 |
|
| - |
|
| - |
|
| - |
Total restructuring costs |
| $ | 2,076 |
| $ | 6,184 |
| $ | 8,260 |
| $ | 4,982 |
| $ | - |
| $ | 4,982 |
Real estate exit costs for the year ended May 29, 2021 consisted of $0.4 million in lease early termination costs paid under the European Plan, $0.4 million in loss on disposal of property and equipment, including $0.2 million under the European Plan and $0.2 million under the North America and APAC Plan, and $0.9 million of impairment of ROU assets, including $0.1 million under the European Plan and $0.8 million under the North America and APAC Plan. Other costs incurred under the European Plan for the year ended May 29, 2021 of $0.7 million were primarily related to legal and professional fees associated with the exit of certain non-core markets in Europe. Real estate exit costs for the year ended May 30, 2020 consisted of $0.6 million of impairment of ROU assets and $0.5 million in loss on disposal of property and equipment, both under the North America and APAC Plan.
The following table summarizes the employee termination activity under both the North America and APAC Plan and the European Plan for the years ended May 30, 2020 and May 29, 2021 (in thousands):
|
|
|
|
Liability balance at May 25, 2019 |
| $ | - |
Increase in liability (restructuring costs) |
|
| 3,927 |
Reduction in liability (payments and others) |
|
| (2,053) |
Liability balance at May 30, 2020 |
|
| 1,874 |
Increase in liability (restructuring costs) |
|
| 5,862 |
Reduction in liability (payments and others) |
|
| (6,473) |
Liability balance at May 29, 2021 |
| $ | 1,263 |
As of May 29, 2021, the Company has substantially completed the planned employee headcount reduction under both the North America and APAC Plan and the European Plan, and has recognized substantially all of the associated expected employee termination costs. The Company expects the remaining liability of $0.4 million and $0.9 million as of May 29, 2021, for the North America and APAC Plan and European Plan, respectively, to be paid out prior to the end of fiscal 2022. The Company currently expects to incur additional restructuring charges in fiscal 2022 as it continues to exit certain real estate leases in accordance with the Restructuring Plans. The exact amount and timing will depend on a number of variables, including market conditions. Given the current macro environment, particularly the current shift away from commercial real estate occupancy, accelerated by the Pandemic, management believes it could take longer and be more costly to terminate and sublet the Company\u2019s leases, therefore taking longer to realize the expected savings. "}]},{"name":"rpt:f-913","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfRestructuringAndRelatedCostsTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Year Ended May 29, 2021 | For the Year Ended May 30, 2020 | |||||||||||||||
|
| North America |
| European |
|
|
| North America |
| European |
|
| ||||||
|
| and APAC Plan |
| Plan |
| Total |
| and APAC Plan |
| Plan |
| Total | ||||||
Employee termination costs |
| $ | 1,024 |
| $ | 4,838 |
| $ | 5,862 |
| $ | 3,927 |
| $ | - |
| $ | 3,927 |
Real estate exit costs |
|
| 1,052 |
|
| 666 |
|
| 1,718 |
|
| 1,055 |
|
| - |
|
| 1,055 |
Other costs |
|
| - |
|
| 680 |
|
| 680 |
|
| - |
|
| - |
|
| - |
Total restructuring costs |
| $ | 2,076 |
| $ | 6,184 |
| $ | 8,260 |
| $ | 4,982 |
| $ | - |
| $ | 4,982 |
|
|
|
|
Liability balance at May 25, 2019 |
| $ | - |
Increase in liability (restructuring costs) |
|
| 3,927 |
Reduction in liability (payments and others) |
|
| (2,053) |
Liability balance at May 30, 2020 |
|
| 1,874 |
Increase in liability (restructuring costs) |
|
| 5,862 |
Reduction in liability (payments and others) |
|
| (6,473) |
Liability balance at May 29, 2021 |
| $ | 1,263 |
General
The Company\u2019s stockholders approved the 2020 Plan on October 22, 2020, which replaced and succeeded in its entirety the 2014 Plan.\u00a0Executive officers and certain employees, as well as non-employee directors of the Company and certain consultants and advisors are eligible to participate in the 2020 Plan.\u00a0The maximum number of shares of the Company\u2019s common stock that may be issued or transferred pursuant to awards under the 2020 Plan equals: (1) 1,797,440 (which represents the number of shares that were available for additional award grant purposes under the 2014 Plan immediately prior to the termination of the authority to grant new awards under the 2014 Plan as of October 22, 2020), plus (2) the number of any shares subject to stock options granted under the 2014 Plan or the Resources Connection, Inc. 2004 Performance Incentive Plan (together with the 2014 Plan, the \u201cPrior Plans\u201d) and outstanding as of October 22, 2020 which expire, or for any reason are cancelled or terminated, after that date without being exercised, plus (3) the
number of any shares subject to restricted stock and restricted stock unit awards granted under the Prior Plans that are outstanding and unvested as of October 22, 2020 which are forfeited, terminated, cancelled, or otherwise reacquired after that date without having become vested. Awards under the 2020 Plan may include, but are not limited to, stock options, stock appreciation rights, restricted stock, stock units, stock bonuses and other forms of awards granted or denominated in shares of common stock or units of common stock, as well as certain cash bonus awards. Historically, the Company has granted restricted stock units and stock option awards that typically vest in equal annual installments, and restricted stock awards vest based on an individual grant basis as described in the award agreement. Stock option grants typically terminate ten years from the date of grant. As of May 29, 2021, there were 1,851,644 shares available for further award grants under the 2020 Plan.
Stock-Based Compensation Expense
Stock-based compensation expense included in selling, general and administrative expenses was $6.6\u00a0million, $6.1 million and $6.6 million for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively. These amounts consisted of stock-based compensation expense related to employee stock options, employee stock purchases made via the ESPP, restricted stock awards, restricted stock units and stock units credited under the Directors Deferred Compensation Plan.
Stock Options
The following table summarizes the stock option activity for the year ended May 29, 2021 (amounts in thousands, except weighted average exercise price):
|
|
|
|
|
|
|
|
|
|
|
|
| Number of |
|
| Weighted |
| Weighted Average |
|
|
|
|
| Shares |
|
| Average |
| Remaining |
|
| Aggregate |
|
| Under |
|
| Exercise |
| Contractual Life |
|
| Intrinsic |
|
| Option |
|
| Price |
| (in years) |
|
| Value |
Awards outstanding at May 30, 2020 |
| 5,755 |
| $ | 16.07 |
| 6.18 |
| $ | - |
Exercised |
| (135) |
|
| 12.05 |
|
|
|
|
|
Forfeited (1) |
| (269) |
|
| 17.54 |
|
|
|
|
|
Expired |
| (795) |
|
| 17.88 |
|
|
|
|
|
Awards outstanding at May 29, 2021 |
| 4,556 |
| $ | 15.78 |
| 5.71 |
| $ | 2,472 |
Exercisable at May 29, 2021 |
| 3,235 |
| $ | 15.00 |
| 4.85 |
| $ | 2,469 |
Vested and expected to vest at May 29, 2021 (2) |
| 4,499 |
| $ | 15.76 |
| 5.68 |
| $ | 2,472 |
\u00a0
(1) For stock options forfeited, represent one share for each stock option forfeited.
(2) The expected to vest options are the result of applying the pre-vesting forfeiture rate assumptions to options not yet vested of 1,321,496 and 2,391,052 as of May 29, 2021 and May 30, 2020, respectively.
The aggregate intrinsic value in the preceding table represents the total pre-tax intrinsic value, based on the Company\u2019s closing stock price of $14.58 as of May\u00a028, 2021 (the last trading day of fiscal 2021), which would have been received by the option holders had all option holders exercised their options as of that date.
\u00a0
The total pre-tax intrinsic value related to stock options exercised during the years ended May 29, 2021, May 30, 2020 and May 25, 2019 was $0.2 million, $1.2 million and $5.2 million, respectively. The total estimated fair value of stock options that vested during the years ended May 29, 2021, May 30, 2020 and May 25, 2019 was $3.2 million, $3.5\u00a0million and $5.4\u00a0million, respectively.
Valuation and Expense Information for Stock Based Compensation Plans
There were no employee stock option grants during the year ended May 29, 2021. The weighted average estimated fair value per share of employee stock options granted during the years ended May 30, 2020 and May 25, 2019 was $3.88 and $4.74, respectively, using the Black-Scholes model with the following assumptions:\u00a0
|
|
|
|
| For the Years Ended | ||
| May 30, 2020 |
| May 25, 2019 |
Expected volatility | 30.9% - 32.9% |
| 31.6% - 34.7% |
Risk-free interest rate | 1.5% - 1.8% |
| 3.1% - 3.2% |
Expected dividends | 3.4% - 3.7% |
| 3.2% |
Expected life | 5.6 - 8.1 years |
| 5.7 - 8.3 years |
Restricted Stock Awards
The following table summarizes the activities for the unvested restricted stock awards for the year ended May 29, 2021 (amounts in thousands, except weighted average grant-date fair value):
|
|
|
|
|
|
|
|
|
|
| Shares |
| Weighted Average Grant-Date Fair Value | |
Outstanding at May 30, 2020 | 90 |
| $ | 15.90 |
Granted | 99 |
|
| 12.47 |
Vested | (62) |
|
| 16.12 |
Unvested as of May 29, 2021 | 127 |
| $ | 13.12 |
Expected to vest as of May 29, 2021 | 115 |
| $ | 13.18 |
As of May 29, 2021, there was $1.4 million of total unrecognized compensation cost related to unvested restricted stock awards. The cost is expected to be recognized over a weighted-average period of 1.71 years. The weighted average estimated fair value per share of restricted stock awards granted during the years ended May 29, 2021, May 30, 2020 and May 25, 2019 was $12.47, $15.98 and $13.93, respectively.
Restricted Stock Units
On January 1, 2018, the Company adopted the Directors Deferred Compensation Plan, which provides the members of the Company\u2019s board of directors who are not officers or employees of the Company the opportunity to defer certain compensation and equity awards paid or granted for their service in the form of stock units (\u201cStock Units\u201d). The Stock Units are used solely as a device for determining the amount of cash benefit to eventually be paid to the director. Each has the same value as one share of Resources Connection, Inc. common stock. Stock Units must be retained until the director leaves the board of directors, at which time the cash value of the Stock Units is paid out. Additional Stock Units are credited to reflect dividends paid on shares of Resources Connection, Inc. common stock. Stock Units credited to a director pursuant to an election to defer compensation (and any dividend equivalents credited thereon) are fully vested at all times. Stock Units credited to a director pursuant to an election to defer an equity award are subject to the vesting conditions applicable to the equity award, except that dividend equivalents credited to a director with respect to such Stock Units are vested at all times. These liability-classified awards are re-measured at each reporting date and on settlement using the closing price of the Company\u2019s common stock on that date. Any change in fair value is recorded as stock-based compensation expense in the period. The Company recognizes stock-based compensation on these Stock Units using the straight-line method over the requisite service period.
The Company also grants restricted stock units to its employees under the 2020 Plan, which are classified as equity awards. The following table summarizes the activities for the unvested restricted stock units, including both equity- and liability-classified restricted stock units, for the year ended May 29, 2021 (amounts in thousands, except weighted average grant-date fair value):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Equity-Classified Restricted Stock Units |
| Liability-Classified Stock Units |
| Total Restricted Stock Units | |||||||||
| Shares |
| Weighted Average Grant-Date Fair Value |
| Shares |
| Weighted Average Grant-Date Fair Value |
| Shares |
| Weighted Average Grant-Date Fair Value | |||
Outstanding at May 30, 2020 | - |
| $ | - |
| 87 |
| $ | 10.99 |
| 87 |
| $ | 10.99 |
Granted | 519 |
|
| 11.41 |
| 54 |
|
| 12.47 |
| 573 |
|
| 11.51 |
Vested | - |
|
| - |
| (52) |
|
| 12.25 |
| (52) |
|
| 12.25 |
Forfeited | (6) |
|
| 11.53 |
| - |
|
| - |
| (6) |
|
| 11.53 |
Unvested as of May 29, 2021 | 513 |
| $ | 11.40 |
| 89 |
| $ | 14.58 |
| 602 |
| $ | 11.87 |
Expected to vest as of May 29, 2021 | 463 |
| $ | 11.41 |
| 88 |
| $ | 14.58 |
| 551 |
| $ | 11.91 |
As of May 29, 2021, there was $6.2 million of total unrecognized compensation cost related to unvested restricted stock units. The cost is expected to be recognized over a weighted-average period of 2.11 years. The weighted average estimated fair value per share of restricted stock units granted during the years ended May 29, 2021, May 30, 2020 and May 25, 2019 was $11.51, $14.98 and $16.08, respectively.
Employee Stock Purchase Plan
On October 15, 2019, the Company\u2019s stockholders approved the ESPP which superseded the 2014 Employee Stock Purchase Plan. The maximum number of shares of the Company\u2019s common stock authorized for issuance under the ESPP is 1,825,000.
The Company\u2019s ESPP allows qualified employees (as defined in the ESPP) to purchase designated shares of the Company\u2019s common stock at a price equal to 85% of the lesser of the fair market value of common stock at the beginning or end of each semi-annual stock purchase period. The Company issued 506,000,\u00a0400,000 and 358,000 shares of common stock pursuant to the ESPP for the years ended May 29, 2021, May 30, 2020 and May 25, 2019, respectively. There were 1,134,355\u00a0shares of common stock available for issuance under the ESPP as of May 29, 2021.
\u00a0"}]},{"name":"rpt:f-951","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAuthorized","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares","us-gaap:PlanNameAxis":"rgp:PerformanceIncentivePlan2020Member"},"factValues":[{"value":"1797440"}]},{"name":"rpt:f-952","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardExpirationPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","us-gaap:AwardTypeAxis":"us-gaap:EmployeeStockOptionMember"},"factValues":[{"value":"P10Y"}]},{"name":"rpt:f-953","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardNumberOfSharesAvailableForGrant","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares","us-gaap:PlanNameAxis":"rgp:PerformanceIncentivePlan2020Member"},"factValues":[{"value":"1851644"}]},{"name":"rpt:f-954","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensation","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6600000","decimals":-5}]},{"name":"rpt:f-955","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensation","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6100000","decimals":-5}]},{"name":"rpt:f-956","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensation","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6600000","decimals":-5}]},{"name":"rpt:f-957","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfShareBasedCompensationStockOptionsActivityTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
|
|
|
| Number of |
|
| Weighted |
| Weighted Average |
|
|
|
|
| Shares |
|
| Average |
| Remaining |
|
| Aggregate |
|
| Under |
|
| Exercise |
| Contractual Life |
|
| Intrinsic |
|
| Option |
|
| Price |
| (in years) |
|
| Value |
Awards outstanding at May 30, 2020 |
| 5,755 |
| $ | 16.07 |
| 6.18 |
| $ | - |
Exercised |
| (135) |
|
| 12.05 |
|
|
|
|
|
Forfeited (1) |
| (269) |
|
| 17.54 |
|
|
|
|
|
Expired |
| (795) |
|
| 17.88 |
|
|
|
|
|
Awards outstanding at May 29, 2021 |
| 4,556 |
| $ | 15.78 |
| 5.71 |
| $ | 2,472 |
Exercisable at May 29, 2021 |
| 3,235 |
| $ | 15.00 |
| 4.85 |
| $ | 2,469 |
Vested and expected to vest at May 29, 2021 (2) |
| 4,499 |
| $ | 15.76 |
| 5.68 |
| $ | 2,472 |
\u00a0
(1) For stock options forfeited, represent one share for each stock option forfeited.
(2) The expected to vest options are the result of applying the pre-vesting forfeiture rate assumptions to options not yet vested of 1,321,496 and 2,391,052 as of May 29, 2021 and May 30, 2020, respectively."}]},{"name":"rpt:f-958","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"5755000","decimals":-3}]},{"name":"rpt:f-959","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"16.07","decimals":2}]},{"name":"rpt:f-960","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"P6Y2M4D"}]},{"name":"rpt:f-961","factDimensions":{"xbrl:concept":"us-gaap:StockIssuedDuringPeriodSharesStockOptionsExercised","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"135000","decimals":-3}]},{"name":"rpt:f-962","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExercisesInPeriodWeightedAverageExercisePrice","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"12.05","decimals":2}]},{"name":"rpt:f-963","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsForfeituresInPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"269000","decimals":-3}]},{"name":"rpt:f-964","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsForfeituresInPeriodWeightedAverageExercisePrice","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"17.54","decimals":2}]},{"name":"rpt:f-965","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExpirationsInPeriod","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"795000","decimals":-3}]},{"name":"rpt:f-966","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementsByShareBasedPaymentAwardOptionsExpirationsInPeriodWeightedAverageExercisePrice","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"17.88","decimals":2}]},{"name":"rpt:f-967","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingNumber","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"4556000","decimals":-3}]},{"name":"rpt:f-968","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingWeightedAverageExercisePrice","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"15.78","decimals":2}]},{"name":"rpt:f-969","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsOutstandingWeightedAverageRemainingContractualTerm2","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"P5Y8M15D"}]},{"name":"rpt:f-970","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsOutstandingIntrinsicValue","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"2472000","decimals":-3}]},{"name":"rpt:f-971","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableNumber","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"3235000","decimals":-3}]},{"name":"rpt:f-972","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisableWeightedAverageExercisePrice","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"15.00","decimals":2}]},{"name":"rpt:f-973","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationSharesAuthorizedUnderStockOptionPlansExercisePriceRangeExercisableOptionsWeightedAverageRemainingContractualTerm2","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"P4Y10M6D"}]},{"name":"rpt:f-974","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsExercisableIntrinsicValue1","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"2469000","decimals":-3}]},{"name":"rpt:f-975","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableNumber","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"4499000","decimals":-3}]},{"name":"rpt:f-976","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableWeightedAverageExercisePrice","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"15.76","decimals":2}]},{"name":"rpt:f-977","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedAndExpectedToVestOutstandingWeightedAverageRemainingContractualTerm1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"P5Y8M4D"}]},{"name":"rpt:f-978","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsVestedAndExpectedToVestExercisableAggregateIntrinsicValue","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"2472000","decimals":-3}]},{"name":"rpt:f-979","factDimensions":{"xbrl:concept":"rgp:ShareBasedCompensationArrangementByShareBasedPaymentAwardEstimatedForfeitures","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"1321496"}]},{"name":"rpt:f-980","factDimensions":{"xbrl:concept":"rgp:ShareBasedCompensationArrangementByShareBasedPaymentAwardEstimatedForfeitures","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"2391052"}]},{"name":"rpt:f-981","factDimensions":{"xbrl:concept":"us-gaap:SharePrice","xbrl:period":"2021-05-29T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"14.58","decimals":2}]},{"name":"rpt:f-982","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"200000","decimals":-5}]},{"name":"rpt:f-983","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"1200000","decimals":-5}]},{"name":"rpt:f-984","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsExercisesInPeriodTotalIntrinsicValue","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"5200000","decimals":-5}]},{"name":"rpt:f-985","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedInPeriodFairValue1","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"3200000","decimals":-5}]},{"name":"rpt:f-986","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedInPeriodFairValue1","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"3500000","decimals":-5}]},{"name":"rpt:f-987","factDimensions":{"xbrl:concept":"us-gaap:SharebasedCompensationArrangementBySharebasedPaymentAwardOptionsVestedInPeriodFairValue1","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"5400000","decimals":-5}]},{"name":"rpt:f-988","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodGross","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"xbrla:shares"},"factValues":[{"value":"0"}]},{"name":"rpt:f-989","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"3.88","decimals":2}]},{"name":"rpt:f-990","factDimensions":{"xbrl:concept":"us-gaap:ShareBasedCompensationArrangementByShareBasedPaymentAwardOptionsGrantsInPeriodWeightedAverageGrantDateFairValue","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD/xbrla:shares"},"factValues":[{"value":"4.74","decimals":2}]},{"name":"rpt:f-991","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfShareBasedPaymentAwardStockOptionsValuationAssumptionsTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
| For the Years Ended | ||
| May 30, 2020 |
| May 25, 2019 |
Expected volatility | 30.9% - 32.9% |
| 31.6% - 34.7% |
Risk-free interest rate | 1.5% - 1.8% |
| 3.1% - 3.2% |
Expected dividends | 3.4% - 3.7% |
| 3.2% |
Expected life | 5.6 - 8.1 years |
| 5.7 - 8.3 years |
|
|
|
|
|
|
|
|
|
|
| Shares |
| Weighted Average Grant-Date Fair Value | |
Outstanding at May 30, 2020 | 90 |
| $ | 15.90 |
Granted | 99 |
|
| 12.47 |
Vested | (62) |
|
| 16.12 |
Unvested as of May 29, 2021 | 127 |
| $ | 13.12 |
Expected to vest as of May 29, 2021 | 115 |
| $ | 13.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Equity-Classified Restricted Stock Units |
| Liability-Classified Stock Units |
| Total Restricted Stock Units | |||||||||
| Shares |
| Weighted Average Grant-Date Fair Value |
| Shares |
| Weighted Average Grant-Date Fair Value |
| Shares |
| Weighted Average Grant-Date Fair Value | |||
Outstanding at May 30, 2020 | - |
| $ | - |
| 87 |
| $ | 10.99 |
| 87 |
| $ | 10.99 |
Granted | 519 |
|
| 11.41 |
| 54 |
|
| 12.47 |
| 573 |
|
| 11.51 |
Vested | - |
|
| - |
| (52) |
|
| 12.25 |
| (52) |
|
| 12.25 |
Forfeited | (6) |
|
| 11.53 |
| - |
|
| - |
| (6) |
|
| 11.53 |
Unvested as of May 29, 2021 | 513 |
| $ | 11.40 |
| 89 |
| $ | 14.58 |
| 602 |
| $ | 11.87 |
Expected to vest as of May 29, 2021 | 463 |
| $ | 11.41 |
| 88 |
| $ | 14.58 |
| 551 |
| $ | 11.91 |
The Company has a defined contribution 401(k) plan (\u201cthe plan\u201d) which covers all employees in the U.S.\u00a0who have completed 90\u00a0days of service and are age\u00a021 or older. Participants may contribute up to 50% of their annual salary up to the maximum amount allowed by statute. As defined in the plan agreement, the Company may make matching contributions in such amount, if any, up to a maximum of 6% of individual employees\u2019 annual compensation. The Company, at its sole discretion, determines the matching contribution made from quarter to quarter. For the years ended May 29, 2021, May 30, 2020 and May 25, 2019, the Company contributed $6.2 million, $6.5\u00a0million and $6.4 million, respectively, to the plan as Company matching contributions.
\u00a0"}]},{"name":"rpt:f-1066","factDimensions":{"xbrl:concept":"us-gaap:DefinedContributionPlanMaximumAnnualContributionsPerEmployeePercent","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"0.50","decimals":2}]},{"name":"rpt:f-1067","factDimensions":{"xbrl:concept":"us-gaap:DefinedContributionPlanEmployerMatchingContributionPercent","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"0.06","decimals":2}]},{"name":"rpt:f-1068","factDimensions":{"xbrl:concept":"us-gaap:DefinedContributionPlanCostRecognized","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6200000","decimals":-5}]},{"name":"rpt:f-1069","factDimensions":{"xbrl:concept":"us-gaap:DefinedContributionPlanCostRecognized","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6500000","decimals":-5}]},{"name":"rpt:f-1070","factDimensions":{"xbrl:concept":"us-gaap:DefinedContributionPlanCostRecognized","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"6400000","decimals":-5}]},{"name":"rpt:f-1071","factDimensions":{"xbrl:concept":"us-gaap:CashFlowSupplementalDisclosuresTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"16.\u00a0Supplemental Disclosure of Cash Flow Information
Additional information regarding cash flows is as follows (in thousands):
\u00a0
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
|
| May 29, |
| May 30, |
| May 25, | |||
|
|
| 2021 |
| 2020 |
| 2019 | |||
Income taxes paid |
|
| $ | 18,034 |
| $ | 8,258 |
| $ | 14,229 |
Interest paid |
|
| $ | 1,562 |
| $ | 2,191 |
| $ | 2,440 |
Non-cash investing and financing activities: |
|
|
|
|
|
|
|
|
|
|
Capitalized leasehold improvements paid directly by landlord |
|
| $ | 121 |
| $ | 137 |
| $ | 2,312 |
Acquisition of Veracity: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | 7,570 |
| $ | - |
Acquisition of taskforce: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | - |
| $ | 2,195 |
Acquisition of Expertence: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | 328 |
| $ | - |
Acquisition of Accretive: |
|
|
|
|
|
|
|
|
|
|
Issuance of common stock |
|
| $ | - |
| $ | 1,141 |
| $ | - |
Dividends declared, not paid |
|
| $ | 4,610 |
| $ | 4,512 |
| $ | 4,105 |
\u00a0
The $18.0 million income taxes paid during the year ended May 29, 2021 was partially due to the tax method change that the Company elected to make related to the capitalization of certain fixed assets as part of its overall tax planning strategies. See further discussion in Note 8 \u2013 Income Taxes.
"}]},{"name":"rpt:f-1072","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfCashFlowSupplementalDisclosuresTableTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
|
|
| May 29, |
| May 30, |
| May 25, | |||
|
|
| 2021 |
| 2020 |
| 2019 | |||
Income taxes paid |
|
| $ | 18,034 |
| $ | 8,258 |
| $ | 14,229 |
Interest paid |
|
| $ | 1,562 |
| $ | 2,191 |
| $ | 2,440 |
Non-cash investing and financing activities: |
|
|
|
|
|
|
|
|
|
|
Capitalized leasehold improvements paid directly by landlord |
|
| $ | 121 |
| $ | 137 |
| $ | 2,312 |
Acquisition of Veracity: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | 7,570 |
| $ | - |
Acquisition of taskforce: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | - |
| $ | 2,195 |
Acquisition of Expertence: |
|
|
|
|
|
|
|
|
|
|
Liability for contingent consideration |
|
| $ | - |
| $ | 328 |
| $ | - |
Acquisition of Accretive: |
|
|
|
|
|
|
|
|
|
|
Issuance of common stock |
|
| $ | - |
| $ | 1,141 |
| $ | - |
Dividends declared, not paid |
|
| $ | 4,610 |
| $ | 4,512 |
| $ | 4,105 |
Legal Proceedings
The Company is involved in certain legal matters in the ordinary course of business. In the opinion of management, all such matters, if disposed of unfavorably, would not have a material adverse effect on the Company\u2019s financial position, cash flows or results of operations.
\u00a0"}]},{"name":"rpt:f-1091","factDimensions":{"xbrl:concept":"us-gaap:SegmentReportingDisclosureTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"18.\u00a0Segment Information and Enterprise Reporting
As discussed in Note 2 \u2014 Summary of Significant Accounting Policies, the Company revised its historical one segment position and identified the following new operating segments effective in the second quarter of fiscal 2021 to align with changes made in its internal management structure and its reporting structure of financial information used to assess performance and allocate resources: RGP, taskforce, and Sitrick. RGP is the Company\u2019s only reportable segment. taskforce and Sitrick do not individually meet the quantitative thresholds to qualify as reportable segments. Therefore, they are combined and disclosed as Other Segments.
The tables below reflect the operating results of the Company\u2019s segments consistent with the management and performance measurement system utilized by the Company. All prior year periods presented were recast to reflect the impact of the preceding segment changes. Performance measurement is based on segment Adjusted EBITDA. Adjusted EBITDA is defined as net income before amortization of intangible assets, depreciation expense, interest and income taxes plus stock-based compensation expense, restructuring costs, and plus or minus contingent consideration adjustments. Adjusted EBITDA at the segment level excludes certain shared corporate administrative costs that are not practical to allocate. The Company\u2019s Chief Operating Decision Maker does not evaluate segments using asset information. Amounts are in thousands.
|
|
|
|
|
|
|
|
|
| For the Years Ended (2) | |||||||
| May 29, |
| May 30, |
| May 25, | |||
| 2021 |
| 2020 |
| 2019 | |||
Revenues: |
|
|
|
|
|
|
|
|
RGP | $ | 587,620 |
| $ | 662,475 |
| $ | 689,602 |
Other Segments |
| 41,896 |
|
| 40,878 |
|
| 39,397 |
Total revenues | $ | 629,516 |
| $ | 703,353 |
| $ | 728,999 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
RGP | $ | 77,589 |
| $ | 87,836 |
| $ | 87,728 |
Other Segments |
| 3,580 |
|
| 2,601 |
|
| 3,323 |
Reconciling items (1) |
| (28,375) |
|
| (30,551) |
|
| (26,434) |
Total Adjusted EBITDA | $ | 52,794 |
| $ | 59,886 |
| $ | 64,617 |
(1) Reconciling items are generally comprised of unallocated corporate administrative costs, including management and board compensation, corporate support function costs and other general corporate costs that are not allocated to segments.
(2) Fiscal year 2020 consisted of 53 weeks. Fiscal year 2021 and Fiscal year 2019 consisted of 52 weeks.
The below is a reconciliation of the Company\u2019s net income to Adjusted EBITDA for all periods presented (amounts in thousands).
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
| May 29, |
| May 30, |
| May 25, | |||
| 2021 |
| 2020 |
| 2019 | |||
Net income | $ | 25,229 |
| $ | 28,285 |
| $ | 31,470 |
Adjustments: |
|
|
|
|
|
|
|
|
Amortization of intangible assets |
| 5,228 |
|
| 5,745 |
|
| 3,799 |
Depreciation expense |
| 3,897 |
|
| 5,019 |
|
| 4,679 |
Interest expense, net |
| 1,600 |
|
| 2,061 |
|
| 2,190 |
Income tax (benefit) expense |
| (2,545) |
|
| 6,943 |
|
| 16,499 |
Stock-based compensation expense |
| 6,613 |
|
| 6,057 |
|
| 6,570 |
Restructuring costs |
| 8,260 |
|
| 4,982 |
|
| - |
Contingent consideration adjustment |
| 4,512 |
|
| 794 |
|
| (590) |
Adjusted EBITDA | $ | 52,794 |
| $ | 59,886 |
| $ | 64,617 |
\u00a0The table below represents the Company\u2019s revenue and long-lived assets by geographic location (amounts in thousands):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue for the Years Ended |
|
| Long-Lived Assets as of (1) | |||||||||||
| May 29, |
| May 30, |
| May 25, |
|
| May 29, |
| May 30, | |||||
| 2021 |
| 2020 |
| 2019 |
|
| 2021 |
| 2020 | |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States | $ | 502,493 |
| $ | 568,725 |
| $ | 575,641 |
| $ |
| 40,988 |
| $ | 50,170 |
International |
| 127,023 |
|
| 134,628 |
|
| 153,358 |
|
|
| 4,211 |
|
| 7,762 |
Total | $ | 629,516 |
| $ | 703,353 |
| $ | 728,999 |
| $ |
| 45,199 |
| $ | 57,932 |
(1) Long lived assets are comprised of property and equipment and ROU assets."}]},{"name":"rpt:f-1092","factDimensions":{"xbrl:concept":"us-gaap:ScheduleOfSegmentReportingInformationBySegmentTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
| For the Years Ended (2) | |||||||
| May 29, |
| May 30, |
| May 25, | |||
| 2021 |
| 2020 |
| 2019 | |||
Revenues: |
|
|
|
|
|
|
|
|
RGP | $ | 587,620 |
| $ | 662,475 |
| $ | 689,602 |
Other Segments |
| 41,896 |
|
| 40,878 |
|
| 39,397 |
Total revenues | $ | 629,516 |
| $ | 703,353 |
| $ | 728,999 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
RGP | $ | 77,589 |
| $ | 87,836 |
| $ | 87,728 |
Other Segments |
| 3,580 |
|
| 2,601 |
|
| 3,323 |
Reconciling items (1) |
| (28,375) |
|
| (30,551) |
|
| (26,434) |
Total Adjusted EBITDA | $ | 52,794 |
| $ | 59,886 |
| $ | 64,617 |
(1) Reconciling items are generally comprised of unallocated corporate administrative costs, including management and board compensation, corporate support function costs and other general corporate costs that are not allocated to segments.
(2) Fiscal year 2020 consisted of 53 weeks. Fiscal year 2021 and Fiscal year 2019 consisted of 52 weeks.
"}]},{"name":"rpt:f-1093","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"587620000","decimals":-3}]},{"name":"rpt:f-1094","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"662475000","decimals":-3}]},{"name":"rpt:f-1095","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"689602000","decimals":-3}]},{"name":"rpt:f-1096","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"41896000","decimals":-3}]},{"name":"rpt:f-1097","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"40878000","decimals":-3}]},{"name":"rpt:f-1098","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"39397000","decimals":-3}]},{"name":"rpt:f-1099","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"629516000","decimals":-3}]},{"name":"rpt:f-1100","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"703353000","decimals":-3}]},{"name":"rpt:f-1101","factDimensions":{"xbrl:concept":"us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"728999000","decimals":-3}]},{"name":"rpt:f-1102","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"77589000","decimals":-3}]},{"name":"rpt:f-1103","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"87836000","decimals":-3}]},{"name":"rpt:f-1104","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"rgp:RgpCoreSegmentMember"},"factValues":[{"value":"87728000","decimals":-3}]},{"name":"rpt:f-1105","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"3580000","decimals":-3}]},{"name":"rpt:f-1106","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"2601000","decimals":-3}]},{"name":"rpt:f-1107","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:OperatingSegmentsMember","us-gaap:StatementBusinessSegmentsAxis":"us-gaap:AllOtherSegmentsMember"},"factValues":[{"value":"3323000","decimals":-3}]},{"name":"rpt:f-1108","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:MaterialReconcilingItemsMember"},"factValues":[{"value":"-28375000","decimals":-3}]},{"name":"rpt:f-1109","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:MaterialReconcilingItemsMember"},"factValues":[{"value":"-30551000","decimals":-3}]},{"name":"rpt:f-1110","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:ConsolidationItemsAxis":"us-gaap:MaterialReconcilingItemsMember"},"factValues":[{"value":"-26434000","decimals":-3}]},{"name":"rpt:f-1111","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"52794000","decimals":-3}]},{"name":"rpt:f-1112","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"59886000","decimals":-3}]},{"name":"rpt:f-1113","factDimensions":{"xbrl:concept":"rgp:AdjustedEearningsBeforeInterestTaxesDepreciationAndAmortization","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"64617000","decimals":-3}]},{"name":"rpt:f-1114","factDimensions":{"xbrl:concept":"us-gaap:ReconciliationOfOtherSignificantReconcilingItemsFromSegmentsToConsolidatedTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
|
|
|
|
|
|
|
|
|
| For the Years Ended | |||||||
| May 29, |
| May 30, |
| May 25, | |||
| 2021 |
| 2020 |
| 2019 | |||
Net income | $ | 25,229 |
| $ | 28,285 |
| $ | 31,470 |
Adjustments: |
|
|
|
|
|
|
|
|
Amortization of intangible assets |
| 5,228 |
|
| 5,745 |
|
| 3,799 |
Depreciation expense |
| 3,897 |
|
| 5,019 |
|
| 4,679 |
Interest expense, net |
| 1,600 |
|
| 2,061 |
|
| 2,190 |
Income tax (benefit) expense |
| (2,545) |
|
| 6,943 |
|
| 16,499 |
Stock-based compensation expense |
| 6,613 |
|
| 6,057 |
|
| 6,570 |
Restructuring costs |
| 8,260 |
|
| 4,982 |
|
| - |
Contingent consideration adjustment |
| 4,512 |
|
| 794 |
|
| (590) |
Adjusted EBITDA | $ | 52,794 |
| $ | 59,886 |
| $ | 64,617 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue for the Years Ended |
|
| Long-Lived Assets as of (1) | |||||||||||
| May 29, |
| May 30, |
| May 25, |
|
| May 29, |
| May 30, | |||||
| 2021 |
| 2020 |
| 2019 |
|
| 2021 |
| 2020 | |||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States | $ | 502,493 |
| $ | 568,725 |
| $ | 575,641 |
| $ |
| 40,988 |
| $ | 50,170 |
International |
| 127,023 |
|
| 134,628 |
|
| 153,358 |
|
|
| 4,211 |
|
| 7,762 |
Total | $ | 629,516 |
| $ | 703,353 |
| $ | 728,999 |
| $ |
| 45,199 |
| $ | 57,932 |
(1) Long lived assets are comprised of property and equipment and ROU assets."}]},{"name":"rpt:f-1142","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"country:US"},"factValues":[{"value":"502493000","decimals":-3}]},{"name":"rpt:f-1143","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"country:US"},"factValues":[{"value":"568725000","decimals":-3}]},{"name":"rpt:f-1144","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"country:US"},"factValues":[{"value":"575641000","decimals":-3}]},{"name":"rpt:f-1145","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"country:US"},"factValues":[{"value":"40988000","decimals":-3}]},{"name":"rpt:f-1146","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"country:US"},"factValues":[{"value":"50170000","decimals":-3}]},{"name":"rpt:f-1147","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"us-gaap:NonUsMember"},"factValues":[{"value":"127023000","decimals":-3}]},{"name":"rpt:f-1148","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"us-gaap:NonUsMember"},"factValues":[{"value":"134628000","decimals":-3}]},{"name":"rpt:f-1149","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"us-gaap:NonUsMember"},"factValues":[{"value":"153358000","decimals":-3}]},{"name":"rpt:f-1150","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"us-gaap:NonUsMember"},"factValues":[{"value":"4211000","decimals":-3}]},{"name":"rpt:f-1151","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","srt:StatementGeographicalAxis":"us-gaap:NonUsMember"},"factValues":[{"value":"7762000","decimals":-3}]},{"name":"rpt:f-1152","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"629516000","decimals":-3}]},{"name":"rpt:f-1153","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2019-05-26T00:00:00/2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"703353000","decimals":-3}]},{"name":"rpt:f-1154","factDimensions":{"xbrl:concept":"us-gaap:Revenues","xbrl:period":"2018-05-27T00:00:00/2019-05-26T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"728999000","decimals":-3}]},{"name":"rpt:f-1155","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2021-05-30T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"45199000","decimals":-3}]},{"name":"rpt:f-1156","factDimensions":{"xbrl:concept":"us-gaap:NoncurrentAssets","xbrl:period":"2020-05-31T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD"},"factValues":[{"value":"57932000","decimals":-3}]},{"name":"rpt:f-1157","factDimensions":{"xbrl:concept":"us-gaap:SubsequentEventsTextBlock","xbrl:period":"2020-05-31T00:00:00/2021-05-30T00:00:00","xbrl:entity":"cik:0001084765"},"factValues":[{"value":"
19. Subsequent Events
Repayment on Revolving Credit Facility
On June 9, 2021, the Company repaid $10.0 million on its Facility, reducing its outstanding borrowing under the Facility to $33.0 million.
"}]},{"name":"rpt:f-1158","factDimensions":{"xbrl:concept":"us-gaap:RepaymentsOfLongTermLinesOfCredit","xbrl:period":"2021-06-09T00:00:00/2021-06-10T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:SubsequentEventTypeAxis":"us-gaap:SubsequentEventMember"},"factValues":[{"value":"10000000.0","decimals":-5}]},{"name":"rpt:f-1159","factDimensions":{"xbrl:concept":"us-gaap:LineOfCredit","xbrl:period":"2021-06-10T00:00:00","xbrl:entity":"cik:0001084765","xbrl:unit":"iso4217:USD","us-gaap:DebtInstrumentAxis":"rgp:CreditFacilityMember","us-gaap:SubsequentEventTypeAxis":"us-gaap:SubsequentEventMember"},"factValues":[{"value":"33000000.0","decimals":-5}]}]}}