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Income Taxes (Tables)

12 Months Ended

May 31, 2018

Income Tax Disclosure [Abstract]

Components of income (loss) before income tax provision

The components of income (loss) before income tax (benefit) expense for the years ended May 31 are as follows:

	2018				2017				2016
(in thousands)
Income (loss) before tax expense:
U.S.	$	6,274			$	8,825			$	(4,444	)
Non-U.S.	1,191				1,022				1,191
	$	7,465			$	9,847			$	(3,253	)

Summary of Income tax (benefit) provision analyzed by category

Income tax (benefit) expense is comprised of the following:

	2018				2017				2016
(in thousands)
Current
Federal	$	(148	)		$	—			$	34
State and local	152				141				103
Non U.S.	73				270				217
	77				411				354
Deferred	(8,947		)		4,428				39,983
Income tax (benefit) expense	$	(8,870	)		$	4,839			$	40,337

Summary of deferred tax asset and liabilities

Temporary differences that give rise to deferred tax assets and liabilities are summarized as follows:

	May 31, 2018				May 31, 2017
(in thousands)
Deferred tax assets
Net operating loss carryforward	$	33,880			$	55,975
Stock-based compensation	2,421				2,653
Federal and state R&D tax credit carryforward	3,644				2,548
Inventories	1,550				2,407
Expenses incurred not currently deductible	1,714				6,522
Accrued liabilities	277				1,289
Gross deferred tax asset	43,486				71,394
Deferred tax liabilities
Excess tax over book depreciation and amortization	34,044				49,158
	34,044				49,158
Valuation Allowance	(26,607		)		(48,348		)
Net deferred tax liability (1)	$	(17,165	)		$	(26,112	)

(1) Net deferred tax liability is inclusive of a non-U.S. $0.08 million deferred tax asset that is included in other assets on the Company's balance sheet for the year ended May 31, 2018.

Summary of Income tax rate reconciliation

The Company's consolidated income tax expense has differed from the amount that would be provided by applying the U.S. Federal statutory income tax rate to the Company's income before income taxes for the following reasons:

	Year ended May 31,
	2018				2017				2016
(in thousands)
Income tax (benefit) expense at statutory tax rate of 28.6%, 35.0% and 35.0%, respectively	$	2,136			$	3,447			$	(1,139	)
Effect of graduated tax rates	—				(98		)		33
State income taxes, net of Federal tax benefit	120				(22		)		(215		)
Impact of Non-U.S. operations	(288		)		403				(162		)
Research and development tax credit	(951		)		(403		)		(499		)
Impact of tax reform	10,912				—				—
Meals and entertainment	242				266				329
Non-deductible interest on contingent payments	—				174				262
Non-taxable gain on revaluation of contingent consideration liability	—				(5,576		)		(170		)
Change in valuation allowance	(21,741		)		6,139				40,685
Effect of elimination of stock compensation APIC pool	—				1,380				739
IPR&D intangible write-off	—				(1,224		)		—
Other	700				353				474
Income tax (benefit) expense	$	(8,870	)		$	4,839			$	40,337

Summary of unrecognized tax benefits reconciliation

The following table provides a reconciliation of the beginning and ending amount of unrecognized tax benefits:

	Year ended May 31,
	2018				2017				2016
(in thousands)
Unrecognized tax benefits balance at June 1	$	899			$	899			$	—
Increase in gross amounts of tax positions related to prior years	—				—				899
Decrease in gross amounts of tax positions related to prior years due to U.S. tax reform	(287		)		—				—
Decrease due to lapse in statute of limitations	(148		)		—				—
Unrecognized tax benefits balance at May 31	$	464			$	899			$	899

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure of income before income tax between domestic and foreign jurisdictions.

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Tabular disclosure of the change in unrecognized tax benefits.

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