Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Mar. 16, 2020 | Jun. 30, 2019 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | ON TRACK INNOVATIONS LTD | ||
Entity Central Index Key | 0001021604 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | false | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity Common Stock, Shares Outstanding | 47,824,377 | ||
Entity Public Float | $ 0 | ||
Entity File Number | 000-49877 | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation State Country Code | L3 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 2,543 | $ 4,827 |
Short-term investments | 2,305 | 1,078 |
Trade receivables (net of allowance for doubtful accounts of $612 and $555 as of December 31, 2019 and December 31, 2018, respectively) | 2,430 | 4,530 |
Other receivables and prepaid expenses | 1,822 | 2,060 |
Inventories | 3,332 | 3,527 |
Total current assets | 12,432 | 16,022 |
Long term restricted deposit for employee benefits | 477 | 451 |
Severance pay deposits | 383 | 375 |
Property, plant and equipment, net | 3,694 | 5,033 |
Intangible assets, net | 733 | 241 |
Right-of-use assets due to operating leases | 2,134 | |
Total Assets | 19,853 | 22,122 |
Current Liabilities | ||
Short-term bank credit and current maturities of long-term bank loans | 2,478 | 260 |
Trade payables | 4,126 | 4,712 |
Other current liabilities | 3,054 | 3,622 |
Total current liabilities | 9,658 | 8,594 |
Long-Term Liabilities | ||
Long-term loans, net of current maturities | 22 | 39 |
Long-term liabilities due to operating leases, net of current maturities | 1,483 | |
Accrued severance pay | 884 | 853 |
Deferred tax liability | 416 | 445 |
Total long-term liabilities | 2,805 | 1,337 |
Total Liabilities | 12,463 | 9,931 |
Commitments and Contingencies | ||
Shareholders' Equity | ||
Ordinary shares of NIS 0.1 par value: Authorized - 50,000,000 shares as of December 31, 2019 and 2018; issued: 47,963,076 and 42,473,076 shares as of December 31, 2019 and 2018, respectively; outstanding: 46,784,377 and 41,294,377 shares as of December 31, 2019 and 2018, respectively | 1,226 | 1,068 |
Additional paid-in capital | 225,970 | 225,022 |
Treasury shares at cost - 1,178,699 shares as of December 31, 2019 and 2018 | (2,000) | (2,000) |
Accumulated other comprehensive loss | (974) | (956) |
Accumulated deficit | (216,832) | (210,943) |
Total Equity | 7,390 | 12,191 |
Total Liabilities and Equity | $ 19,853 | $ 22,122 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) $ in Thousands | Dec. 31, 2019USD ($)shares | Dec. 31, 2019₪ / shares | Dec. 31, 2018USD ($)shares | Dec. 31, 2018₪ / shares |
Statement of Financial Position [Abstract] | ||||
Allowance for doubtful accounts, net | $ | $ 612 | $ 555 | ||
Ordinary shares, par value | ₪ / shares | ₪ 0.1 | ₪ 0.1 | ||
Ordinary shares, shares authorized | 50,000,000 | 50,000,000 | ||
Ordinary shares, shares issued | 47,963,076 | 42,473,076 | ||
Ordinary shares, shares outstanding | 46,784,377 | 41,294,377 | ||
Treasury shares, at cost | 1,178,699 | 1,178,699 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues | |||
Sales | $ 9,983 | $ 16,725 | $ 16,252 |
Licensing and transaction fees | 4,768 | 5,153 | 4,621 |
Total revenues | 14,751 | 21,878 | 20,873 |
Cost of revenues | |||
Cost of sales | 7,455 | 10,710 | 10,456 |
Total cost of revenues | 7,455 | 10,710 | 10,456 |
Gross profit | 7,296 | 11,168 | 10,417 |
Operating expenses | |||
Research and development | 3,334 | 3,175 | 3,263 |
Selling and marketing | 5,026 | 5,940 | 5,633 |
General and administrative | 4,112 | 3,981 | 3,651 |
Other (income) expenses, net | (341) | 33 | 52 |
Total operating expenses | 12,131 | 13,129 | 12,599 |
Operating loss from continuing operations | (4,835) | (1,961) | (2,182) |
Financial expenses, net | (397) | (228) | (341) |
Loss from continuing operations before taxes on income | (5,232) | (2,189) | (2,523) |
Income tax benefit, net | 57 | 301 | 138 |
Net loss from continuing operations | (5,175) | (1,888) | (2,385) |
Net (loss) income from discontinued operations | (714) | 1,625 | 1,787 |
Net loss | $ (5,889) | $ (263) | $ (598) |
Basic and diluted net (loss) income attributable to shareholders per ordinary share | |||
From continuing operations | $ (0.12) | $ (0.05) | $ (0.06) |
From discontinued operations | (0.02) | 0.04 | 0.05 |
Total | $ (0.14) | $ (0.01) | $ (0.01) |
Weighted average number of ordinary shares used in computing basic and diluted net (loss) income per ordinary share | 41,385,856 | 41,268,984 | 41,109,875 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total comprehensive loss: | |||
Net loss | $ (5,889) | $ (263) | $ (598) |
Foreign currency translation adjustments | (18) | (265) | 545 |
Total comprehensive loss | $ (5,907) | $ (528) | $ (53) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Share capital | Additional paid-in capital | Treasury Shares | Accumulated other comprehensive (loss) income | Accumulated deficit | Total | |
Balance at Dec. 31, 2016 | $ 1,061 | $ 224,415 | $ (2,000) | $ (1,236) | $ (210,082) | $ 12,158 | |
Balance, Shares at Dec. 31, 2016 | 42,243,075 | ||||||
Changes during the period ended | |||||||
Stock-based compensation | $ 1 | 253 | 254 | ||||
Stock-based compensation, Shares | [1] | 45,000 | |||||
Exercise of options | $ 2 | 90 | 92 | ||||
Exercise of options, Shares | 65,002 | ||||||
Foreign currency translation adjustments | 545 | 545 | |||||
Net loss | (598) | (598) | |||||
Balance at Dec. 31, 2017 | $ 1,064 | 224,758 | (2,000) | (691) | (210,680) | 12,451 | |
Balance, Shares at Dec. 31, 2017 | 42,353,077 | ||||||
Changes during the period ended | |||||||
Stock-based compensation | $ 3 | 231 | 234 | ||||
Stock-based compensation, Shares | [1] | 80,000 | |||||
Exercise of options | $ 1 | 33 | 34 | ||||
Exercise of options, Shares | 39,999 | ||||||
Foreign currency translation adjustments | (265) | (265) | |||||
Net loss | (263) | (263) | |||||
Balance at Dec. 31, 2018 | $ 1,068 | 225,022 | (2,000) | (956) | (210,943) | 12,191 | |
Balance, Shares at Dec. 31, 2018 | 42,473,076 | ||||||
Changes during the period ended | |||||||
Issuance of shares, net of issuance expenses of $111 | $ 157 | 824 | 981 | ||||
Issuance of shares, net of issuance expenses of $111, shares | [2] | 5,460,000 | |||||
Stock-based compensation | $ 1 | 124 | 125 | ||||
Stock-based compensation, Shares | [1] | 30,000 | |||||
Foreign currency translation adjustments | (18) | (18) | |||||
Net loss | (5,889) | (5,889) | |||||
Balance at Dec. 31, 2019 | $ 1,226 | $ 225,970 | $ (2,000) | $ (974) | $ (216,832) | $ 7,390 | |
Balance, Shares at Dec. 31, 2019 | 47,963,076 | ||||||
[1] | See Note 11B. | ||||||
[2] | See Note 11A. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Net of issuance expenses | $ 111 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from continuing operating activities | |||
Net loss from continuing operations | $ (5,175) | $ (1,888) | $ (2,385) |
Adjustments required to reconcile net loss to net cash used in continuing operating activities: | |||
Stock-based compensation related to options and shares issued to employees and others | 125 | 234 | 254 |
(Gain) loss on sale of property and equipment | (328) | (37) | 52 |
Accrued interest and linkage differences, net | (36) | 19 | (6) |
Depreciation and amortization | 1,270 | 1,328 | 1,172 |
Deferred tax benefits, net | (25) | (477) | (165) |
Changes in operating assets and liabilities: | |||
Change in accrued severance pay, net | 23 | (57) | 45 |
Decrease (increase) in trade receivables, net | 1,646 | 1,118 | (124) |
Decrease (increase) in other receivables and prepaid expenses | 228 | 350 | (838) |
Decrease (increase) in inventories | 184 | (573) | 110 |
Decrease in trade payables | (507) | (2,089) | (644) |
Decrease in other current liabilities | (270) | (110) | (597) |
Net cash used in continuing operating activities | (2,865) | (2,182) | (3,126) |
Cash flows from continuing investing activities | |||
Purchase of property and equipment and intangible assets | (1,155) | (756) | (532) |
Proceeds from sale of property, plant and equipment | 1,102 | 68 | 17 |
Change in short-term investments, net | (1,369) | 1,495 | 1,773 |
Proceeds from restricted deposit for employee benefits | 10 | 8 | 44 |
Net cash (used in) provided by continuing investing activities | (1,412) | 815 | 1,302 |
Cash flows from continuing financing activities | |||
Increase (decrease) in short-term bank credit, net | 2,450 | (3,554) | (335) |
Repayment of long-term bank loans | (270) | (1,064) | (632) |
Proceeds from issuance of shares, net of issuance expenses | 981 | ||
Proceeds from exercise of options and warrants | 34 | 92 | |
Net cash provided by (used in) continuing financing activities | 3,161 | (4,584) | (875) |
Cash flows from discontinued operations | |||
Net cash (used in) provided by discontinued operating activities | (1,344) | 750 | 2,311 |
Net cash provided by discontinued investing activities | 2,750 | ||
Total net cash (used in) provided by discontinued operations | (1,344) | 3,500 | 2,311 |
Effect of exchange rate changes on cash and cash equivalents | 3 | (243) | 687 |
(Decrease) increase in cash, cash equivalents and restricted cash | (2,457) | (2,694) | 299 |
Cash, cash equivalents and restricted cash - beginning of the year | 5,105 | 7,799 | 7,500 |
Cash, cash equivalents and restricted cash at the end of the year | 2,648 | 5,105 | 7,799 |
Cash paid during the period for: | |||
Interest paid | 78 | 121 | 176 |
Income taxes paid | 150 | 89 | 61 |
Supplemental disclosures of non-cash flow information | |||
Payables due to purchase of fixed assets | $ 73 |
General
General | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | Note 1 - General A. Introduction On Track Innovations Ltd. (the "Company") was founded in 1990, in Israel. The Company and its subsidiaries (together, the "Group") are principally engaged in the field of design and development of cashless payment solutions. The Company's ordinary shares are listed for trading on the OTCQX market (formerly listed on the Nasdaq Capital Market until October 31, 2019). At December 31, 2019, the Company operates in two operating segments: (a) Retail and Mass Transit Ticketing, and (b) Petroleum. See Note 15. During December 2018, the Company sold its medical smart cards operation - see Note 1B. As to the Company's major customers, see Note 16. Certain definitions $ - United States Dollars NIS - New Israeli Shekel B. Divestiture of operations 1. In December 2013, the Company completed the sale of certain assets, subsidiaries and intellectual property ("IP") relating to its Smart ID division, for a total purchase price of $10,000 in cash and an additional $12,500 subject to performance-based milestones. Accordingly, the results and the cash flows of this operation for all reporting periods are presented in the statements of operations and in the statements of cash flows, respectively, as discontinued operations separately from continuing operations. On April 20, 2016, the purchaser of the Smart ID division, SuperCom Ltd. ("SuperCom"), and the Company entered into a settlement agreement resolving certain litigation between SuperCom and the Company pursuant to which SuperCom paid the Company $2,050 and agreed to pay the Company up to $1,500 in accordance with and subject to a certain earn-out mechanism. In November 2017, the Company commenced an arbitration procedure with SuperCom, in which the Company claims that additional earn-out payments have not been paid to the Company. SuperCom raised claims against the Company during the arbitration for material damages. The evidence in the arbitration was heard on March 6, 2018, and an arbitration decision was issued on December 24, 2018 in the Company's favor and denied SuperCom's claims. The arbitrator ordered SuperCom to disclose the financial information regarding the earn-out payments that the Company is entitled to receive, and to pay the Company accordingly, or otherwise pay the Company the maximum earn-out amount, which equals $1,500 minus the earn-out amounts that were already paid by SuperCom to the Company. The arbitration verdict was approved as a court's verdict in June 2019, but SuperCom failed to disclose the financial information in the way it should have done according to the arbitration decision. Therefore, in December 2019 the Company submitted a complementary claim to the arbitrator, asking for a final award that includes a final payment by SuperCom (as opposed to merely disclosing information). As mentioned in Note 2U, the Company records the earn-out payments only when the consideration is determined to be realizable. The Company did not record or receive any contingent consideration during the years ended December 31, 2019, 2018 and 2017. 2. In December 2018, the Company completed the sale of its medical smart cards operation ("Medismart") (formerly part of the Company's "Other segment") to Smart Applications International Limited ("Smart") for a total price of $2,750. The Company has determined that the sale of the Medismart business qualifies as a discontinued operation. Accordingly, the results and the cash flows of this operation for all reporting periods are presented in the statements of operations and in the statements of cash flows, respectively, as discontinued operations separately from continuing operations (see also Note 14). |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2 - Significant Accounting Policies The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The significant accounting policies followed in the preparation of the financial statements, applied on a consistent basis, except the accounting policy as mentioned in Note 2W, are as follows: A. Liquidity and Capital Resources The Company has had recurring losses and currently has an accumulated deficit as of December 31, 2019 of $216,832. The Company also has a payable balance on its short-term loan of $2,478 that is due within the next 12 months. Since inception, the Company's principal sources of liquidity have been revenues, proceeds from sales of equity securities, borrowings from banks, cash from the exercise of options and warrants as well as proceeds from the divestiture of part of the Company's businesses. The Company had cash, cash equivalents and short-term investments representing bank deposits of $4,848 (of which an amount of $105 has been pledged as securities for certain items) as of December 31, 2019. The Company believes that it has sufficient capital resources to fund its operations for at least the next 12 months. Further, as disclosed in Note 11A, if certain conditions are met, including the approval of the Company's shareholders at the extraordinary general meeting of the shareholders that is scheduled for April 2020, the Company expects to receive funds in a total amount of up to $1,200 in consideration for the issuance of up to 6,000,000 Ordinary Shares, all in accordance with the terms and provisions of the Share Purchase Agreement (as defined in Note 11A below). As of the reporting date, it is hard to assess the future influence of the Corona Virus on the Company. The Company believes that one impact of the Corona Virus on the Company may be a decrease in the Company's revenues derived from Mass Transit activity in the Polish market. The Company is aware of no other material short term adverse influences on the Company. However, at this initial point in time, it is hard to predict what other impacts the Corona Virus may have on the Company. B. Financial statements in U.S. dollars Substantially all of the Company's and certain of its subsidiaries' revenues are in U.S. dollars. A significant portion of purchases of materials , Transactions and balances denominated in U.S. dollars are presented at their original amounts. For entities with a U.S. dollar functional currency, transactions and balances in other currencies are remeasured into U.S. dollars in accordance with the principles set forth in Accounting Standards Codification ("ASC") Topic 830, Foreign Currency Matters At each balance sheet date, recorded balances of monetary assets and liabilities that are denominated in a currency other than the functional currency are adjusted to reflect the current exchange rate. Exchange gains and losses from the remeasurement of such items denominated in non U.S. dollar currencies are reflected in the consolidated statements of operations, among 'financial expenses, net', as appropriate. The functional currency of the Company's subsidiary in South Africa changed in October 2017 from the South African Rand to U.S. dollar. This change resulted from a change in relevant circumstances whereby sales transactions denominated in U.S. dollars became the primary source of sales revenue. The functional currency of the Polish subsidiary is its local currency. The financial statements of companies with a functional currency that is not the U.S. dollar are translated into U.S. dollars using the exchange rate at the balance sheet date for assets and liabilities, and weighted average exchange rates for revenues and expenses (which approximates the translation of each transaction). Translation adjustments resulting from the process of the aforesaid translation are included as a separate component of equity (accumulated other comprehensive gain or loss). C. Principles of consolidation The consolidated financial statements include the financial statements of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. D. Estimates and assumptions The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the year. Such estimates include the valuation of useful lives of long-lived assets, revenue recognition, valuation of accounts receivable and allowance for doubtful accounts, valuation of inventories, legal contingencies, the assumptions whether renewal options of lease period of buildings will be exercised in the future, the assumptions used in the calculation of stock-based compensation, income taxes and other contingencies. Estimates and assumptions are periodically reviewed by management and the effects of any material revisions are reflected in the period that they are determined to be necessary. Actual results, however, may vary from these estimates. E. Cash equivalents Cash equivalents are short-term highly liquid investments and debt instruments that are readily convertible to cash with original maturities of three months or less from the date of purchase. Bank deposits with original maturities of more than three months, or specific deposits that are intended to be held as bank deposits for more than three months, and which will mature within one year, are classified as short-term investments. F. Trade receivables Trade receivables are recorded at the invoiced amount and do not bear interest. Collections of trade receivables are included in net cash provided by operating activities in the consolidated statements of cash flows. The consolidated financial statements include an allowance for loss from receivables for which collection is in doubt. In determining the adequacy of the allowance consideration is given to each trade receivable historical experience, aging of the receivable, adjusted to take into account current market conditions and information available about specific debtors, including their financial condition, current payment patterns, the volume of their operations, and evaluation of the security received from them or their guarantors. G. Short-term investments Short-term investments consist of: (1) Bank deposits whose maturities are longer than three months from the date of purchase, but not longer than one year from the balance sheet date. (2) Bank deposits whose maturities are less than three months from the date of purchase, but are intended to be held as bank deposits for more than three months. (3) Restricted bank deposits whose maturities are not longer than one year from the balance sheet date (for further details, see Note 9C). H. Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined by calculating raw materials, work in process and finished products on a "moving average" basis. Net realizable value is defined as the "estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation." Inventory write-offs are provided to cover risks arising from slow moving items or technological obsolescence. Such write-offs have been included in cost of revenues. I. Property, plant and equipment, net Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets as follows: Years Buildings 25 Computers, software and manufacturing equipment 3-5 Office furniture and equipment 5-16 (mainly - 10) Leasehold improvements are amortized by the straight-line method over the shorter of the lease term or the estimated useful economic life of such improvements. J. Impairment of long-lived assets Long-lived assets, such as right-of-use assets due to operating leases, property, plant, and equipment, and intangible assets subject to amortization, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by an asset to the carrying value of the asset. If the carrying value of the long-lived asset is not recoverable on an undiscounted cash flow basis, impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. K. Revenue recognition Accounting policy applicable before January 1, 2018: The Group generates revenues from product sales manufactured based on the Company's technology. In addition, the Company generates revenues from the technology it developed through transaction fee arrangements and licensing agreements. Revenues are also generated from non-recurring engineering, customer services and technical support. Revenues from product sales and non-recurring engineering are recognized when delivery has occurred provided there is persuasive evidence of an agreement, the fee is fixed or determinable, collection of the related receivable is probable and no further obligations exist. In the case of non-recurring engineering, revenue is recognized upon completion of testing and approval of the customization of the product by the customer, provided that no further obligation exists. Revenues are recognized net of value added tax. License and transaction fees are recognized as earned based on actual usage. Usage is determined by receiving confirmation from the users. Revenues relating to customer services and technical support are recognized as the services are rendered ratably over the term of the related contract. Licensing and transaction fees are recognized based on the volume of transactions or monthly licensing fees from systems that contain the Company's products and usually bear no cost to the Company. The cost to the Company of warranty that the product will perform according to certain specifications and that the Company will repair or replace the product if it ceases to work properly, is insignificant and is treated according to accounting guidance for contingencies. Accounting policy applicable after January 1, 2018: In May 2014, the Financial Accounting Standards Board ("FASB") issued ASC Topic 606, Revenue from Contracts with Customers The Company has adopted Topic 606 commencing from January 1, 2018 on a modified retrospective basis. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting under Topic 605. The Company utilized a comprehensive approach in order to assess the impact of the guidance on its contract portfolio by reviewing its current accounting policies and practices to identify potential differences that would result from applying the new requirements, including evaluation of the performance obligations and variable consideration. The Company did not have a cumulative adjustment to retained earnings or an impact on its revenue recognition policies or on its consolidated financial statements as a result of the adoption of the new standard. Topic 606 requires entities to follow a five-step process: (1) Identify the contract(s) with a customer, (2) Identify the performance obligations in the contract, (3) Determine the transaction price, (4) Allocate the transaction price to the performance obligations in the contract, and (5) Recognize revenue when (or as) the entity satisfies a performance obligation. Accounting policy applicable after January 1, 2018 (cont'd): The Company accounts for a contract with a customer when it has approval and commitment from both parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. For each contract, the Company exercises judgement to identify separate performance obligations and to evaluate, at the inception of the contract, if each distinct performance obligation within the contract is satisfied at a point in time or over time. Revenue is measured based on a consideration specified in a contract with a customer, and excludes any sales incentives and amounts collected on behalf of third parties. In certain arrangements with variable consideration, the Company exercises judgement in order to estimate the amount of variable consideration to be included in the transaction price. In these arrangements, revenue is recognized over time as it is mainly attributed to ongoing services provided. Revenue is allocated among performance obligations in a manner that reflects the consideration that the Company expects to be entitled for the promised goods or services based on standalone selling prices "SSP". SSP are estimated for each distinct performance obligation and judgment may be required in their determination. The best evidence of SSP is the observable price of a product or service when the Company sells the goods separately in similar circumstances and to similar customers. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. For an analysis of the performance obligations and the timing of revenue recognition, for each type of the contract, see also Note 10. The new standard requires the Company to provide more robust disclosures than required by previous guidance. Such disclosures have been provided in Note 10. In addition, when the Company has an unconditional right to receive proceeds before the performance obligation was fulfilled, it is now required to record receivables against contract liabilities. L. Research, development costs and intangible assets Research and development costs, which consist mainly of labor costs, materials and subcontractors, are charged to operations as incurred. In accordance with ASC Topic 350-40, "Internal Use Software" According to ASC Topic 350, " Intangibles - Goodwill and Other Amortization expenses amounted to $202, $215 and $181 for the years ended December 31, 2019, 2018 and 2017, respectively. The amortization is presented within research and development in the consolidated statements of operations. M. Stock-based compensation The Company measures and recognizes compensation expense for all stock-based payment awards made to employees and directors based on estimated grant date fair values. The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period, which is generally the vesting period. ASC Topic 718, Compensation – Stock Compensation The Company estimates forfeitures based on historical experience. The Company elected to recognize compensation cost for awards with only service conditions that have a graded vesting schedule using the straight-line method. N. Basic and diluted net loss per share Basic and diluted net loss per ordinary share is computed based on the weighted average number of ordinary shares outstanding during each year. Shares issuable for little or no cash consideration, are considered outstanding ordinary shares and included in the computation of basic net loss per ordinary share as of the date that all necessary conditions have been satisfied. In years that discontinued operations are presented, the Company uses income from continuing operations (attributable to the parent entity) as the benchmark to determine whether potential common shares are dilutive or antidilutive. Therefore, when the Company records a loss from continuing operations and the issuance of option shares would be antidilutive due to the loss, but the Company has net income from discontinued operations, potential shares are excluded from the diluted calculation even though the effect on net income from discontinued operations would be dilutive. Stock options and warrants in the amounts of 809,000, 1,501,000 and 1,535,000 outstanding as of the years ended December 31, 2019, 2018 and 2017, respectively, have been excluded from the calculation of the diluted net loss per ordinary share because all such securities have an anti-dilutive effect for all periods presented. O. Fair value of financial instruments The Company's financial instruments consist mainly of cash and cash equivalents, short-term interest bearing investments, accounts receivable, restricted deposits for employee benefits, accounts payable and short-term and long-term loans. Fair value for the measurement of financial assets and liabilities is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company utilizes a valuation hierarchy for disclosure of the inputs for fair value measurement. This hierarchy prioritizes the inputs into three broad levels as follows: ● Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. ● Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ● Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. By distinguishing between inputs that are observable in the market place, and therefore more objective, and those that are unobservable and therefore more subjective, the hierarchy is designed to indicate the relative reliability of the fair value measurements. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The Company, in estimating fair value for financial instruments, determined that the carrying amounts of cash and cash equivalents, trade receivables, short-term bank credit and trade payables are equivalent to, or approximate their fair value due to the short-term maturity of these instruments. The carrying amounts of variable interest rate long-term loans are equivalent or approximate to their fair value as they bear interest at approximate market rates. P. Income tax The Company accounts for taxes on income in accordance with ASC Topic 740, Income Taxes The Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. The Company accounts for interest and penalties as a component of income tax expense. Q. Severance pay The Company's liability for severance pay for some of its Israeli employees is calculated pursuant to Israeli Severance Pay Law, 1963 (the "Israeli Severance Pay Law") based on the most recent salary of the employee multiplied by the number of years of employment, as of the balance sheet date. Those employees are entitled to one month's salary for each year of employment or a portion thereof. Certain senior executives were entitled to receive additional severance pay. The Company records the liability as if it were payable at each balance sheet date on an undiscounted basis. The liability is classified based on the expected date of settlement, and therefore is usually classified as a long-term liability, unless the cessation of the employees is expected during the upcoming year. The Company's liability for those Israeli employees is partially provided for by monthly deposits for insurance policies and the remainder by an accrual. The value of these policies is recorded as an asset in the Company's balance sheet. The deposited funds include profits and losses accumulated up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the obligation pursuant to the Israeli Severance Pay Law or labor agreements. The value of the deposited funds is based on the cash redemption value of these policies. In addition, the Company has deposited certain amounts with a trustee, to compensate for any severance pay liability that is not covered by other funds. These deposits are restricted and may be withdrawn only for payment of severance pay liabilities. The severance pay funds and the restricted deposits for employee benefits are classified based on the classification of the corresponding liability. In respect of other Israeli employees, the Company acts pursuant to the general approval of the Israeli Ministry of Labor and Welfare, pursuant to the terms of Section 14 of the Israeli Severance Pay Law, according to which the current deposits with the pension fund and/or with the insurance company exempt the Company from any additional obligation to these employees for whom the said depository payments are made. These deposits are accounted as defined contribution payments. Severance pay expenses for the years ended December 31, 2019, 2018 and 2017 amounted to $275, $212 and $242, respectively. Defined contribution plan expenses were $231, $232 and $231 in the years ended December 31, 2019, 2018 and 2017, respectively. R. Advertising expenses Advertising expenses are charged to the statements of operations as incurred. Advertising expenses for the years ended December 31, 2019, 2018 and 2017 amounted to $1,015, $1,367 and $1,254, respectively. S. Concentrations of credit or business risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents, bank deposits and trade receivables. Cash equivalents are invested mainly in U.S. dollars with major banks in Israel and Europe. Management believes that the financial institutions that hold the Group's investments are financially sound and, accordingly, minimal credit risk exists with respect to these investments. Most of the Company's trade receivables are derived from sales to large and financially secure organizations. In determining the adequacy of the allowance, management bases its opinion, inter alia, on the estimated risks, current market conditions and in reliance on available information with respect to the debtor's financial position. As for major customers, see Note 16. The Company acquires certain components of its products from single source manufacturers. The activity in the allowance for doubtful accounts for the years ended December 31, 2019, 2018 and 2017 is as follows: 2019 2018 2017 Allowance for doubtful accounts at beginning of year $ 555 $ 568 $ 720 Additions charged to allowance for doubtful accounts 54 52 73 Write-downs charged against the allowance (10 ) (45 ) (225 ) Other 13 (20 ) - Allowance for doubtful accounts at end of year $ 612 $ 555 $ 568 T. Commitments and contingencies Liabilities for loss contingencies arising from claims, assessments, litigations, fines and penalties and other sources are recognized when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. Loss recovery related to recovery of a loss when the recovery is less than or equal to the amount of the loss recognized in the financial statements is recognized if collection is probable and estimable. Gain contingencies are recognized only when resolved. U. Business divestures As described in Note 1B, the Company has sold certain operations. Upon reaching a definitive agreement with an acquirer, the Company recognizes the consideration received from the divesture, less all assets and liabilities sold, as a gain or loss. Discontinued operations Upon divesture of a business, the Company classifies such business as a discontinued operation, if the divested business represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. For disposals other than by sale such as abandonment, the results of operations of a business would not be recorded as a discontinued operation until the period in which the business is actually abandoned. The SmartID Division divesture and the Medismart divesture qualify as discontinued operations and therefore have been presented as such. The results of businesses that have qualified as discontinued operations have been presented as such for all reporting periods. Results of discontinued operations include all revenues and expenses directly derived from such businesses; general corporate overhead is not allocated to discontinued operations. Any loss or gain that arose from the divesture of a business that qualifies as discontinued operations has been included within the results of the discontinued operations. The Company also presents cash flows from discontinued operations separately from cash flows of continuing operations. Contingent consideration The Company's sale arrangements consist of contingent consideration based on the divested businesses' future sales or profits. The Company records the contingent consideration portion of the arrangement when the consideration is determined to be realizable. V. Restricted Cash and Cash Equivalents in Statement of Cash Flows In December 2016, the FASB issued Accounting Standards Update ("ASU") 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash and cash equivalents reported within the accompanying consolidated balance sheets that sum to the total of the same such amounts presented in the accompanying consolidated statements of cash flows: December 31 2019 2018 2017 Cash and cash equivalents $ 2,543 $ 4,827 $ 6,742 Restricted cash and cash equivalents (*) 105 278 1,057 Total cash, cash equivalents, and restricted cash and cash equivalents presented in the statements of cash flows $ 2,648 $ 5,105 $ 7,799 (*) The restricted cash and cash equivalents are included in short-term investments in the accompanying consolidated balance sheets. W. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes ASC 840, Leases. This ASU requires lessees to recognize a right-of-use asset and lease liability on the balance sheet for most leases, whereas until December 31, 2018, only financing-type lease liabilities (capital leases) were recognized on the balance sheet. Right-of-use assets represent a company's right to use an underlying asset for the lease term and lease liabilities represent a company's obligation to make lease payments arising from the lease. Operating and finance lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of the lease payments. In addition, the definition of a lease in the ASU has been revised with respect to when an arrangement conveys the right to control the use of the identified asset under the arrangement, which may result in changes to the classification of an arrangement as a lease. The ASU does not significantly change the lessees' recognition, measurement and presentation of expenses and cash flows from the previous accounting standard. Lessors' accounting under the ASU is largely unchanged from the previous accounting standard. The ASU expands the disclosure requirements of lease arrangements. The Company has adopted ASU 2016-02 commencing from January 1, 2019, under the effective date method . The Company did not have a cumulative-effect adjustment to retained earnings as a result of the adoption of the new standard. The adoption of this standard does not have a material impact on the results of operations and cash flows. See Note 17 for the impact on the balance sheet as of December 31, 2019, and additional disclosures, as required by the new standard. X. Recent accounting pronouncements 1. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments affect entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018. The Company currently does not expect the adoption of this accounting standard to have a material impact on its consolidated financial statements 2. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This ASU, among other things, removes the exception to the incremental approach for intraperiod allocation of tax expense when a company has a loss from continuing operations and income from other items that are not included in continuing operations, such as income from discontinued operations, or income recorded in other comprehensive income. The general rule under ASC 740-20-45-7 is that the tax effect of pretax income or loss from continuing operations should be determined by a computation that does not consider the tax effects of items that are not included in continuing operations. Previously, companies could consider the impact on a loss from continuing operations of items in discontinued operations or other comprehensive income. However, under the amended guidance, companies should not consider the effect of items outside of continuing operations in calculating the tax effect on continuing operations. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a retrospective, modified retrospective or prospective basis, depending on the specific amendment. The Company |
Short-Term Investments
Short-Term Investments | 12 Months Ended |
Dec. 31, 2019 | |
Investments [Abstract] | |
Short-term investments | Note 3 - Short-term investments Balances at December 31, 2019 and 2018 consist of bank deposits . See Note 9C as to restrictions on certain deposits. |
Other Receivables and Prepaid E
Other Receivables and Prepaid Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Other Receivables and Prepaid Expenses [Abstract] | |
Other Receivables and Prepaid Expenses | Note 4 - Other Receivables and Prepaid Expenses December 31 2019 2018 Government institutions $ 414 $ 387 Prepaid expenses 224 226 Receivables under contractual obligations to be transferred to others (*) 330 349 Suppliers advance 544 932 Other receivables 310 166 $ 1,822 $ 2,060 ( * ) The Company's subsidiary in Poland is required to collect certain fees that are to be transferred to local authorities. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 5 - Inventories December 31 2019 2018 Raw materials $ 1,497 $ 1,331 Finished products 1,835 2,196 $ 3,332 $ 3,527 |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Note 6 - Property, Plant and Equipment, Net A. Consist of: December 31 2019 2018 Cost Buildings and leasehold improvements (*) $ 278 $ 966 Computers, software and manufacturing equipment 15,630 16,052 Office furniture and equipment 253 153 Motor vehicles 173 195 Total cost 16,334 17,366 Total accumulated depreciation 12,640 12,333 $ 3,694 $ 5,033 (*) See also Note 12 in connection with sale of the building in South Africa. B. As to liens - See Note 9C. C. Depreciation expenses amounted to $1,068, $1,113 and $991 for the years ended December 31, 2019, 2018 and 2017, respectively. |
Other Current Liabilities
Other Current Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities, Current [Abstract] | |
Other Current Liabilities | Note 7 - Other Current Liabilities December 31 2019 2018 Employees and related expenses $ 613 $ 1,042 Accrued expenses 887 921 Customer advances 111 141 Short-term liabilities due to operating leases and current maturities (**) 686 - Other current liabilities (*)757 (*)1,518 $ 3,054 $ 3,622 (*) The balances as of December 31, 2019 and 2018 include provisions in amounts of $552 and $1,370, as mentioned in Note 14 and Note 9E(1), respectively. (**) See Note 2W. |
Bank Loans
Bank Loans | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Bank Loans | Note 8 - Bank Loans A. Composition of long-term loans: December 31 2019 2018 Long-term loans (*) $ 24 $ 299 Less - current maturities 2 260 $ 22 $ 39 (*) As of December 31, 2019, the bank loans are denominated in South African Rand. B. Composition of short-term loans, bank credit and current maturities of long-term loans: December 31 December 31 2019 2019 2018 % Interest rate In U.S. Dollars (*) 3.60 $ 2,020 $ - In NIS 5.12 456 - 2,476 - Current maturities of long-term loans 2 260 $ 2,478 $ 260 The weighted average interest rates of the short-term bank credit for the years ended December 31, 2019 and 2018 were 3.88% and 3.82%, respectively, per annum. (*) On May 24, 2019, ASEC S.A. (Spolka Akcyjna), the Polish subsidiary of the Company (hereinafter – "ASEC"), entered into a loan agreement with PKO Bank Polski, a Polish bank (hereinafter – "the Lender"). The agreement provides that the Lender will grant an overdraft facility to ASEC in the amount of $2,000. On May 24, 2019 the Lender loaned to ASEC the full amount of the loan, secured by certain assets of ASEC (hereinafter – "the Secured Loan"). The Secured Loan matures on May 23, 2020. The loan will be payable in full on maturity (with option of early repayment by ASEC) and the interest is paid on a monthly basis. The Secured Loan bears interest at an annual interest rate based on 1-month LIBOR plus a margin of 1.8%, or currently approximately 3.6% in total. The agreement includes customary events of default, including, among others, failures to repay any amounts due to the Lender, breaches or defaults under the terms of the agreement, etc. If an event of default occurs, the Lender may reduce the amount of the Secured Loan, demand an additional security or terminate the agreement. C. Liens for short-term and long-term loans - see Note 9C. D. As of December 31, 2019, the Group has authorized unused credit lines of $1,694. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9 - Commitments and Contingencies A. Commitments and Contingencies: The Company has entered into several research and development agreements, pursuant to which the Company received grants from the Government of Israel, and are therefore obligated to pay royalties to the Government of Israel at a rate of 3% - During the years ended December 31, 2019 and 2018, there were no royalty expenses. Royalty expenses amounted to $111 for the year ended December 31, 2017, and were charged to cost of revenues. B. Leases The Group operates from leased facilities in the United States, Israel, Poland and South Africa, leased for periods expiring in years 2020 through 2024. Minimum future rentals of premises, including construction costs-reimbursement, that should be paid under non-cancelable operating lease agreements at rates in effect as of December 31, 2019 are as follows: 2020 $ 738 2021 675 2022 558 2023 322 2024 (*)543 $ 2,836 (*) The table above includes, among other things, the minimum future rentals of the headquarter office in Yokne’am, Israel (in lieu of the previous leased headquarters building in Rosh Pina), that the Company has leased since January 2020, subsequent to the balance sheet date, due to the fact that its lease agreement was signed as of December 31, 2019. The operating lease period of this office is five years (excluding the extension-period, as mentioned in the agreement). The total annual rent expenses of this building, including management fees and excluding construction costs-reimbursement, is approximately NIS 595 ($172). The construction costs-reimbursement is approximately NIS 2,913 ($843), out of which 50% will be paid during the lease period . See also Note 17. C. Liens The Company and certain subsidiaries have recorded floating charges on all of its tangible assets in favor of banks. The Company’s and certain subsidiaries’ manufacturing facilities and certain equipment have been pledged as security in respect of a loan received from a bank. The Company’s short-term deposits in the amount of $105 have been pledged as security in respect of guarantees granted . D. Guarantees As of December 31, 2019, the Company granted performance guarantees and guarantees to secure customer advances in the sum of $404. The expiration dates of the guarantees range from April 2020 to September 2021. E. Legal claims 1. In June 2013, prior to the Company’s divestiture of its SmartID division, Merwell Inc. (“Merwell”) filed a claim against the Company before an agreed-upon arbitrator alleging breach of contract in connection with certain commissions claimed to be owed to Merwell with respect to the division’s activities in Tanzania. These activities, along with all other activities of the SmartID division, were later assigned to and assumed by SuperCom in its purchase of the division. SuperCom undertook to indemnify the Company and hold it harmless against any liabilities the Company may incur in connection with Merwell’s consulting agreement and the arbitration. An arbitration decision was issued on February 21, 2016, awarding Merwell approximately $855 for outstanding commissions, plus expenses and legal fees. The arbitration decision had been appealed and the appeal was denied on June 17, 2018. In order to collect the award, Merwell filed a motion against the Company and the Nazareth District Court issued a judgment requiring the Company to pay Merwell an amount of NIS 5,080 (approximately $1,370) that was paid by the Company on January 8, 2019. As mentioned above, based on the agreement with SuperCom from April 2016 (which was granted an effect of a court judgment), SuperCom is liable for all the costs and liabilities arising out of this claim. Since SuperCom failed to pay the Company the amounts due, in February 2019 the Company initiated an arbitration process to collect from SuperCom, the amount paid to Merwell, as well as any complementary amounts, as may be ordered in the future. The consolidated financial statements as of December 31, 2018, include a provision for the full amount paid. Despite the fact that, based on the assessment of the Company’s external legal counsel, the likelihood to succeed in the arbitration process (or other legal procedure in that matter) is high, the Company did not record an indemnification asset as of December 31, 2019 and December 31, 2018 , 2. On June 12, 2019, Merwell submitted a complementary claim against the Company in arbitration, with respect to the additional financial details that Merwell claims that the Company was ordered to provide according to the arbitration verdict from February 21, 2016, and additional payments that Merwell claims that the Company is obligated to pay Merwell. The said financial details refer to the quantity of smart driving licenses that Merwell claims were issued in the later period of a project in Tanzania in which Merwell claims to have provided services to the Company. Merwell claims that despite the Company’s failure to provide the details, Merwell obtained the details independently from other sources, and they indicate that the Company is obligated to pay Merwell an additional amount of approximately $1,618, and there might be additional amounts to be claimed in the future, as additional information might be found from time to time. On March 4, 2020, the Company submitted a response to this complementary claim, rejecting Merwell’s claims. As mentioned above, the Company is conducting in parallel a separate arbitration process against SuperCom in that matter, as the Company deems SuperCom to be liable for all the costs and liabilities arising out of this claim. Based on the assessment of the Company’s external legal counsel, given the preliminary stage of the procedure, it is difficult, at this point, to estimate the chances of Merwell’s claims for a complementary arbitration verdict. 3. In October 2013, a financial claim was filed against the Company and its then French subsidiary, Parx France (in this paragraph, together, the “Defendants”), in the Commercial Court of Paris, France (in this paragraph, the “Court”). The sum of the claim is €1,500 (approximately $1,708) and is based on the allegation that the plaintiff sustained certain losses in connection with Defendants not granting the plaintiff exclusive marketing rights to distribute and operate the Defendants’ PIAF Parking System in Paris and the Ile of France. On October 25, 2017, the Court issued its ruling in this matter dismissing all claims against the Company but ordering Parx France to pay the plaintiff €50 ($57) plus interest in damages plus another approximately €5 ($6) in other fees and penalties. The Company offered to pay the amounts mentioned above to the plaintiff in consideration for not filing future appeals. The Plaintiff rejected this offer and filed an appeal against Parx France and the Company claiming the sum of €503 ($573) plus interest and expenses. On November 7, 2019, our external legal counsel concluded that the appeal was inadmissible, and that it believed that the opposing claims would be dismissed. The appeal hearing is scheduled for May 4, 2020. Based on the assessment of the Company’s external legal counsel, the Company’s management is of the opinion that the chances of the appeal being approved against the Company are low. 4. In July 2019, the Company received a request (the “Request”), to allow a petitioner to submit a class action, which concerns the petitioner’s claims that, inter alia, through the EasyPark card, drivers are permitted to exceed the quota of permitted hours in accordance with the instructions of various local authorities in Israel. The Request was submitted against a company (the “Buyer’s Company”) incorporated by the buyer of the assets (including the parking activity) of the Israeli subsidiaries of the Company (the “Company’s Subsidiaries”) and against two other companies that operate technological means for payment for public parking spaces scattered throughout the cities. Since the majority of potential claims against the Company’s Subsidiaries relate to the period following the sale of the Company’s Subsidiaries’ assets, including the parking activity, it appears that the Company’s exposure through this channel is limited. Furthermore, even if payment will be required, the buyer would be liable for the majority of such payment. Therefore the Company will not participate in such procedure at this stage. Based on the assessment of the Company’s external legal counsel, the exposure of the Company is low. 5. Regarding additional legal claims please see Notes 1B(1) and 14. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Note 10 - Revenues Disaggregation of revenue The following table disaggregates the Company's revenue by major source based on categories that depict its nature and timing as reviewed by management for the years ended December 31, 2019 and 2018 : Year ended December 31 2019 Retail and Mass Transit Ticketing Petroleum Total Cashless payment products (A) $ 6,156 $ - $ 6,156 Complete cashless payment solutions (B): Sales of products (B1) 773 1,964 2,737 Licensing fees, transaction fees and services (B2) 4,580 1,278 5,858 5,353 3,242 8,595 Total revenues $ 11,509 $ 3,242 $ 14,751 Year ended December 31 2018 Retail and Mass Transit Ticketing Petroleum Total Cashless payment products (A) $ 8,751 $ - $ 8,751 Complete cashless payment solutions (B): Sales of products (B1) 2,986 3,794 6,780 Licensing fees, transaction fees and services (B2) 4,890 1,457 6,347 7,876 5,251 13,127 Total revenues $ 16,627 $ 5,251 $ 21,878 Performance obligations Below is a listing of performance obligations for the Company's main revenue streams: A. Cashless payment products – The performance obligation is the selling of contactless payment products. Most of those products are Near Field Communication (NFC) readers. For such sales the performance obligation, transfer of control and revenue recognition occur when the products are delivered. B. Complete cashless payment solutions – The complete solution includes selling of products and complementary services, as follows: 1. Sales of products – ● Selling of contactless payment products (see A above) together with payment gateways and machine-to-machine controllers. ● Selling of petroleum payment solutions including site and vehicle equipment. For such sales, the performance obligation, transfer of control and revenue recognition occur when the products are delivered. 2. Licensing fees, transaction fees and services - The types of arrangements and their main performance obligations are as follows: ● To provide terminal management system licensing for software that is responsible for remote terminal management and cloud-based software licensing which provide data insights. For such services, the revenue recognition occurs as the services are rendered since the performance obligation is satisfied over time. ● To enable loading and sale of electronic contactless and paper cards. For such transaction fees the revenue recognition occurs on the transaction date. ● To provide technical and customer services for products. For such services, the performance obligation is satisfied over time and therefore revenue recognition occurs as the services are rendered. The Company includes a warranty in connection with certain contracts with customers, which are not considered to be separate performance obligations. The cost to the Company of this warranty is insignificant. Contract balances December 31 December 31 2019 2018 Trade receivables, net of allowance for doubtful accounts $ 2,430 $ 4,530 Customer advances $ 111 $ 141 Accounts receivable are recognized when the right to consideration becomes unconditional based upon contractual billing schedules. Transaction price and variable consideration The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer, excluding amounts collected on behalf of third parties. In certain arrangements with variable consideration, revenue is recognized over time as it is mainly attributed to ongoing services provided. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Equity | Note 11 - Equity A. Share capital On December 23, 2019, the Company entered into a share purchase agreement (hereinafter – the “Agreement”) with Jerry L Ivy, Jr. Descendants Trust (hereinafter - “Ivy”) and two other investors who are members of the Company’s Board of Directors (collectively together with Ivy – “Investors”). The Agreement relates to a private placement of an aggregate of up to 12,500,000 ordinary shares of the Company for aggregate gross proceeds to the Company of up to $2,500. As part of this Agreement, on December 2019 and January 2020 (subsequent to the balance sheet date), the Company issued 5,460,000 and 1,040,000 ordinary shares, respectively, for aggregate gross proceed of $1,092 and $208, respectively. The issuance costs were approximately $111 during 2019. Under the term of the Agreement and following the issuance of those shares, the Company agreed to appoint one representative to its Board of Directors, designated by Ivy. Also, pursuant to the Agreement, Ivy has a right to purchase any future equity securities offered by the Company, except with respect to certain exempt issuances as set forth in the Agreement. The issuance of the remainder 6,000,000 ordinary shares (hereinafter – the “Subsequent Closing”) for aggregate gross proceeds of $1,200 is subject, among other things, to the Company obtaining approval from its shareholders to an increase in the number of the ordinary shares authorized for issuance from 50,000,000 to 100,000,000, the issuance of the ordinary shares to Ivy following which Ivy will hold 25% or more of the total voting rights at the general meeting of the shareholders of the Company and to the election of the representative to the Board of Directors, designated by Ivy. In addition, pursuant to the terms of the Agreement, after the Subsequent Closing occurs, at Ivy’s election, the Board shall appoint an additional representative designated by Ivy; provided, however, that the appointment of such designee shall remain valid through the next general meeting of the Company’s shareholders or as set forth in the Articles of Association of the Company. The Subsequent Closing may be terminated by the Company or Investors by written notice to the other parties if, among other, the Subsequent Closing has not been consummated by April 30, 2020. B. Shares to non-employees During 2019, 2018 and 2017, the Company granted its consultants 30,000, 80,000 and 45,000 ordinary shares, respectively. The expenses that are recognized due to these grants are immaterial and are presented within ‘stock-based compensation’ in the statement of changes in equity. C. Stock option plans In February 2001, the Company’s Board of Directors (the “Board”) approved an option plan, under which up to 75,000 share options are to be granted to the Company’s employees, directors and consultants and those of the Company’s subsidiaries and affiliates. During the years 2002 to 2012, the Board approved an increase of 13,125,000 options to be reserved under the Company’s share option plan. On October 22, 2013, the Board approved a further increase of 2,500,000 options to be reserved under the Company’s share option plan. On June 17, 2014, the Board approved a further increase of 750,000 options to be reserved under the Company’s share option plan. On November 21, 2017, following the approval of the compensation committee and the Board, the shareholders of the Company approved an amendment to the Company’s share option plan, so that securities may be issued under such plan from time to time until December 31, 2021. The vesting period for the options ranges from immediate vesting to ratable vesting over a four- year period. The exercise price of options under the plan is at varying prices. Those options expire up to five years after the date of the grant. Any options which are forfeited or cancelled before expiration become available for future grants. The fair value of each option granted to employees during 2019, 2018 and 2017 was estimated on the date of grant, using the Black-Scholes model and the following assumptions: Year ended December 31 2019 2018 2017 Expected dividend yield 0 % 0 % 0 % Expected volatility 78%-88 % 69%-81 % 67%-74 % Risk-free interest rate 1.63%-2.47 % 1.92%-2.84 % 1.35%-1.83 % Expected life - in years 2.44 2.33 2.45 1. Dividend yield of zero percent for all periods. 2. Expected average volatility represents a weighted average standard deviation rate for the price of the Company’s ordinary shares on Nasdaq and on the OTCQX market, as applicable. 3. Risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. 4. Estimated expected lives are based on historical grants data. The Company’s options activity during 2019 (including options to non-employees) and information as to options outstanding and options exercisable as of December 31, 2019 and 2018 are summarized in the following table: Number of Weighted Aggregate Outstanding – December 31, 2018 1,461,000 $ 1.24 Options granted 260,000 0.51 Options expired or forfeited (912,000 ) 1.31 Outstanding – December 31, 2019 (*)809,000 $ 0.93 - Exercisable as of: December 31, 2019 505,657 $ 1.06 - (*) As of December 31, 2019, the shareholders meeting has not yet converged in order to approve a grant of 450,000 options to the Company’s Chief Executive Officer (hereinafter – “CEO”). Therefore, the options outstanding as of December 31, 2019, do not include those options. Each option shall be exercisable upon payment of the exercise price which will be equal to the average closing price of the share of Company during the trading days over the 30 calendar days prior to the date when the CEO’s employment agreement will be approved by the Company’s Shareholders. The options will be subject to a three-year vesting period starting on the CEO employment commencement date so that each portion of 150,000 options shall vest on each of the first, second and third anniversaries of the commencement date. The weighted average grant date fair value of options granted is $0.19, $0.46 and $0.66 per option during 2019, 2018 and 2017, respectively. The following table summarizes information about options outstanding and exercisable (including options to non-employees) as of December 31, 2019: Options outstanding Options Exercisable Number Weighted Number Weighted outstanding average Weighted Outstanding average Weighted as of remaining Average As of remaining Average Range of December 31, contractual Exercise December 31, contractual Exercise exercise price 2019 life (years) Price 2019 life (years) Price $ 0.44-0.90 333,000 3.54 $ 0.61 110,995 1.78 $ 0.77 $ 1.07-1.68 476,000 2.40 $ 1.15 394,662 2.30 $ 1.14 809,000 2.87 505,657 2.19 No options were exercised in 2019. The total exercise date intrinsic value of options exercised during the years ended December 31, 2018 and 2017, was $16 and $32, respectively. As of December 31, 2019, there was $90 of total unrecognized compensation cost related to non-vested stock-based compensation arrangements. That cost is expected to be recognized over a weighted-average period of 1.11 years. The total fair value of shares vested during the year ended December 31, 2019 was $157. During 2019, 2018 and 2017, the Company recorded stock-based compensation expenses in the amount of $125, $234 and $254, respectively, in accordance with ASC Topic 718. Stock-based compensation expenses are not deductible for tax purposes. D. Warrants 1. During 2019, 40,000 warrants expired. 2. As of December 31, 2019, there are no outstanding warrants. |
Supplemental statement of opera
Supplemental statement of operations data | 12 Months Ended |
Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |
Supplemental statement of operations data | Note 12 - Supplemental statement of operations data Other (income) expenses, net Consists of: Year ended December 31. 2019 2018 2017 (Gain) loss on sale of property and equipment, net (*) (328 ) (37 ) 52 Consulting fees - 70 - Other (13 ) - - Other (income) expenses, net $ (341 ) $ 33 $ 52 (*) In March 2019, OTI Petrosmart (Pty), Ltd., the South African subsidiary (hereinafter – “Petrosmart”), entered into an agreement pursuant to which Petrosmart agreed to sell its head office in Cape Town, South Africa, to a third party for consideration of Rand 15,500 (approximately $1,100), and Petrosmart agreed to lease back this building for its current operations. The sale has been completed and the operating lease commenced during the third quarter of 2019. The leaseback period is three years. The annual rent for the first year is approximately Rand 1,800 (approximately $128) and will be increased by 8.5% each year. Petrosmart has the right to extend the lease by two years. The Company recognized a profit in the amount of approximately $328 during the third quarter of 2019 due to the sale of the building. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 13 - Income Taxes A. The Company and its Israeli subsidiaries 1. Measurement of taxable income under the Income Tax (Inflationary Adjustments) Law, 1985 The Company and one of its Israeli subsidiaries are foreign invested companies, and have elected, commencing January 1, 2007, to maintain their books and records in U.S. dollars for income tax purposes, as permitted under the tax regulations. 2. The Law for the Encouragement of Industry (taxes), 1969 The Company believes that it qualifies as an “Industrial Company” under the Law for the Encouragement of Industry. The principal tax benefits for the Company are the deductibility of costs in connection with public offerings and amortization of certain intangibles. 3. Corporate tax rate Presented hereunder are the standard tax rates in Israel in the years 2017-2019: 2019 – 23% 2018 – 23% 2017 – 24% Current taxes for the reported periods are calculated according to the tax rates presented above. On January 4, 2016, the statutory tax rate was changed to 25% following a reduction of a corporate tax by the Israeli government. Furthermore, on December 22, 2016, the Israeli government passed a law under which the corporate tax rate was reduced from 25% to 23% in two steps. The first reduction was to a rate of 24% as from January 2017 and the second reduction was to a rate of 23% as from January 2018. The deferred tax balances as at December 31, 2019, 2018 and 2017 were calculated according to the new tax rates, at the tax rate expected to apply on the date of reversal. 4. Benefits under the Law for the Encouragement of Capital Investments According to the Law for the Encouragement of Capital Investments – 1959 (the “Law”), as amended, two new tax tracks exist, one of which may be relevant to the Company, the preferred enterprise track, which mainly provide a uniform and reduced tax rate for all the Company’s income entitled to benefits. According to the amended law, t he tax rates on income derived by preferred companies are as follows: 7.5% for Development Area A and 16% for the rest of the country. In addition to the aforesaid beneficial tax rates, preferred companies in Development Area A are entitled to grants track. The Law also provides that no tax will apply to a dividend distributed out of preferred income to a shareholder that is an Israeli resident company. A tax rate of 20% shall apply to a dividend distributed out of preferred income to an individual shareholder or foreign resident, subject to double taxation prevention treaties. The Company currently meets the conditions provided in the Law for inclusion in the scope of the preferred enterprise track. B. Non-Israeli subsidiaries are taxed based on the income tax laws in their country of residence. On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Tax Legislation”) was enacted in the United States. Except for certain provisions, the Tax Legislation was effective for tax years beginning on or after January 1, 2018. The Tax Legislation significantly revised several sections of the U.S. Internal Revenue Code including, among other things, lowering the corporate income tax rate from 35% to 21% effective January 1, 2018, limiting deductibility of interest expense and implementing a modified territorial tax system that imposes a repatriation tax on deemed repatriated earnings of foreign subsidiaries. The main effect on the Company’s U.S. subsidiary was the lowering the corporate income tax rate from 35% to 21%, which did not have a material effect on the Company’s financial statements. C. Deferred tax assets and liabilities: December 31 December 31 2019 2018 Deferred tax assets: Carryforward losses $ 46,102 $ 44,926 Other 766 763 Total gross deferred tax assets 46,868 45,689 Less – valuation allowance (46,868 ) (45,689 ) Net deferred tax assets $ - $ - Deferred tax liability - Other * (416 ) (445 ) Net deferred tax liability $ (416 ) $ (445 ) * Relates mainly to property, plant and equipment. C. Deferred tax assets and liabilities (cont’d) The net changes in the total valuation allowance for each of the years ended December 31, 2019, 2018 and 2017, are comprised as follows: Year ended December 31 2019 2018 2017 Balance at beginning of year $ 45,689 $ 46,024 $ 46,450 Additions during the year from Continuing operations 1,233 122 413 Changes due to amendments to tax laws and applicable future tax rates, see Note 13A(3) - - (518 ) Discontinued operations - see Note 1B 164 (5 ) (239 ) Tax from previous years (169 ) (310 ) (312 ) Exchange rate differences on carryforward losses 13 (20 ) 244 Adjustments to beginning-of-the-year balance due to utilization of carryforward losses in certain subsidiaries - - (16 ) Deferred intercompany transactions (44 ) (122 ) - Other changes (18 ) - 2 Balance at end of year $ 46,868 $ 45,689 $ 46,024 In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the periods in which those temporary differences or carry-forwards are deductible. Based on the level of historical taxable losses, management has reduced the deferred tax assets with a valuation allowance to the amount it believes is more likely than not to be realized. D. As of December 31, 2019, the operating loss carry-forwards and capital loss carryforwards relating to Israeli companies amounted to $159,815 and $37,375, respectively. Operating losses in Israel may be carried forward indefinitely to offset against future taxable operational income. Under the Income Tax (Inflationary Adjustments) Law, 1985, and based on the Company’s election (see Note 13A(1)), tax loss carry-forwards are denominated in U.S. dollars. Net operating carry-forward losses relating to non-Israeli companies aggregate $3,347, which will expire as follows: 2027 - $2,814 and 2028- $533. E. The Company has not recognized a deferred tax liability for the undistributed earnings of its foreign subsidiaries that arose in 2019 and prior years, because the Company considers these earnings to be indefinitely reinvested. These undistributed earnings will be taxed upon distribution, if at all. A deferred tax liability will be recognized when the Company can no longer demonstrate that it plans to indefinitely reinvest these undistributed earnings. As of December 31, 2019, the undistributed earnings of these foreign subsidiaries were $4,594. It is impracticable to determine the additional taxes payable when these earnings are remitted. F. Income tax expenses allocated to continuing operations are as follows: Year ended December 31 2019 2018 2017 Current income tax expenses $ (96 ) $ (161 ) $ (14 ) Current income tax benefits (expenses) from previous years 128 (15 ) (13 ) Deferred tax benefit 25 477 165 Income tax benefit, net $ 57 $ 301 $ 138 Income tax expenses included in discontinued operations expenses are $515 and $212 for the years ended December 31, 2018 and 2017. The net loss from discontinued operations for the year ended December 31, 2019, does not include income tax expenses. Reported income tax expense for the years ended December 31, 2019, 2018 and 2017 differed from the amounts that would result from applying the Israeli statutory tax rates of 23%, 23% and 24%, respectively, to loss from continuing operations before taxes on income, as a result of the following: Year ended December 31 2019 2018 2017 Computed “expected” income tax benefit $ 1,203 $ 503 $ 606 Decrease in income tax benefit resulting from: Change in valuation allowance, net (1,233 ) (122 ) (413 ) Nondeductible stock-based compensation related to options issued to employees (29 ) (53 ) (61 ) Other nondeductible expenses (19 ) (3 ) (22 ) Tax from previous years 128 (15 ) (13 ) Other 7 (9 ) 41 Reported income tax benefit $ 57 $ 301 $ 138 G. Loss from continuing operations before taxes on income consists of the following: Year ended December 31 2019 2018 2017 Israel $ (5,526 ) $ (2,765 ) $ (2,906 ) Non-Israel 294 576 383 $ (5,232 ) $ (2,189 ) $ (2,523 ) H. Unrecognized tax benefits As of December 31, 2019, 2018 and 2017, the Company did not have any unrecognized tax benefits. In addition, the Company does not expect that the amount of unrecognized tax benefits will change significantly within the next twelve months. For the years ended December 31, 2019, 2018 and 2017, no interest and penalties related to unrecognized tax benefits have been accrued. The Company and its major subsidiaries file income tax returns in Israel, Poland and South Africa. With few exceptions, the income tax returns of the Company and its major subsidiaries are open to examination by the Israeli and the respective foreign tax authorities for the tax years beginning in 2014. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued operations | Note 14 - Discontinued operations As described in Note 1B, the Company divested its interest in the SmartID division and the Medismart activity and presented these activities as discontinued operations. Set forth below are the results of the discontinued operations: Year ended December 31 2019 2018 2017 Revenues $ - $ 1,722 $ 1,509 Expenses (232 ) (1,381 ) (1,068 ) Other (loss) income, net (*)(482 ) (**)1,284 (*)1,346 Net (loss) income from discontinued operations $ (714 ) $ 1,625 $ 1,787 (*) During the year ended December 31, 2017, the Company recorded $1,346 as 'other income, net' within the net income from discontinued operations based on a judgment issued by the Israeli Central District Court regarding the Company's lawsuit against Harel Insurance Company Ltd. ("Harel") for damages incurred by the Company due to flooding in a subcontractor's manufacturing site in 2011. The judgment determined that an amount of $1,600, net be awarded to cover the Company's damages. On October 10, 2017, Harel submitted its appeal of the judgment to the Israeli Supreme Court as well as a request for stay of judgment. On January 26, 2020, subsequent to the balance sheet date, Harel and the Company agreed to the offer of the Israeli Supreme Court, as made by way of settlement in which the Company will pay back to Harel the sum of NIS 1,907 (approximately $553) in three monthly equal installments starting February 26, 2020. The consolidated financial statements as of December 31, 2019, include provision in the amount of $553, out of which $482 is presented as 'other income, net' within the net loss from discontinued operations and $71 is presented as 'general and administrative expenses' within the net loss from continuing operations. (**) During the year ended December 31, 2018, the total gain from the Medismart operation divesture, net of transaction costs, amounted to $2,639. This gain together with the expense in the amount of $1,355 that derives from a loss contingency, as mentioned in Note 9E(1), are included in 'other income, net' within the net income from discontinued operations. |
Operating Segments
Operating Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Operating segments | Note 15 - Operating segments In view of how the Company’s chief operating decision maker (“CODM”) reviews operating results for the purposes of allocating resources and assessing performance, the Company currently reports two segments which are the Group’s strategic business units: (a) Retail and Mass Transit Ticketing, and (b) Petroleum. The following summary describes the operations in each of the Group’s operating segments: ● Retail and Mass Transit Ticketing - includes selling and marketing a variety of products for cashless payment solutions for the retail market and mass transit ticketing. ● Petroleum - includes manufacturing and selling of fuel payment and management solutions. The Group’s solution is a wireless, cashless, cardless and paperless refueling tracking and payment solution, providing customers with maximum flexibility and security. The strategic business unit’s allocation of resources and evaluation of performance are managed separately. The CODM does not examine assets or liabilities for those segments and therefore they are not presented. Information regarding the results of each reportable segment is included below based on the internal management reports that are reviewed by the CODM. Year ended December 31, 2019 Retail and Petroleum Consolidated Revenues $ 11,509 $ 3,242 $ 14,751 Reportable segment gross profit * 6,583 1,501 8,084 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (783 ) Stock-based compensation (5 ) Gross profit for the period $ 7,296 Year ended December 31, 2018 Retail and Petroleum Consolidated Revenues $ 16,627 $ 5,251 $ 21,878 Reportable segment gross profit * 9,441 2,557 11,998 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (826 ) Stock-based compensation (4 ) Gross profit for the period $ 11,168 Year ended December 31, 2017 Retail and Petroleum Consolidated Revenues $ 15,755 $ 5,118 $ 20,873 Reportable segment gross profit * 8,623 2,552 11,175 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (757 ) Stock-based compensation (1 ) Gross profit for the period $ 10,417 * Gross profit as reviewed by the CODM represents gross profit, adjusted to exclude depreciation and stock-based compensation. |
Geographic Information and Majo
Geographic Information and Major Customers | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Geographic Information and Major Customers | Note 16 - Geographic Information and Major Customers The data is presented in accordance with ASC Topic 280, “ Segment reporting. Year ended December 31 2019 2018 2017 Revenues by geographical areas from external customers Americas $ 3,625 $ 7,914 $ 7,167 Asia 1,074 3,122 3,421 Africa 2,087 2,447 2,814 Europe 7,965 8,395 7,295 Total export 14,751 21,878 20,697 Domestic (Israel) - - 176 $ 14,751 $ 21,878 $ 20,873 December 31 December 31 2019 2018 Long lived assets by geographical areas Domestic (Israel) $ 1,846 $ 686 Poland 3,992 3,704 South Africa 496 884 America 19 - $ 6,353 $ 5,274 Major Customers Year ended December 31 2019 2018 2017 % % % Major Customers by percentage from total revenues Customer A 21 % 15 % 16 % Customer B 0 % 9 % 12 % Customer C 4 % 11 % 11 % Customer D 15 % 7 % 4 % * The revenues derived from those three customers are presented within the revenues from the Retail and Mass Transit Ticketing. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Note 17 - Leases The Company leases a limited number of assets, mainly offices and cars for use in its operations. The Company adopted the new accounting standard ASC 842, “Leases”, and all the related amendments on January 1, 2019 and used the effective date as Company’s date of initial application. As of December 31, 2019, right-of-use assets due to operating leases are $2,134 (as of January 1, 2019 - $1,572) and the liabilities due to operating leases are $2,169 (as of January 1, 2019 - $1,572), out of which $1,483 are classified as long-term liabilities and $686 are classified as current liabilities (see Note 7). The Company includes renewal options that it is reasonably certain to exercise in the measurement of the lease liabilities. The remaining operating lease periods of the leases range from less than one year to six years as of December 31, 2019. The weighted average remaining lease term is 1.7 years as of December 31, 2019. The Company does not record right-of-use asset and operating lease liability regarding the building in Yokne’am (Israel), as mentioned in Note 9B, in its consolidated financial statements as of December 31, 2019, due to the fact that the commencement date of the lease period is in January 2020, subsequent to the balance sheet date. The Company expects an increase of approximately $1,800 in the right-of-use assets and in the lease liabilities on the first-time-recognition of this lease. The following is a schedule of the maturities of operating lease liabilities for the next five years as of December 31, 2019, and thereafter, as were taken into account in the calculation of the operating lease liabilities as of December 31, 2019: 2020 $ 821 2021 689 2022 496 2023 191 2024 118 Thereafter 29 Total leases payments 2,344 Less - discount 175 Operating lease liabilities $ 2,169 As of December 31, 2019, the weighted average discount rate of the operating leases is approximately 5.3%. Operating lease costs and cash paid for amounts included in the measurement of the lease liabilities were approximately $900 during the year ended December 31, 2019. Operating lease costs include fixed payments and variable payments that depend on an index or rate. There are no other significant variable lease payments. The Company does not have any material leases, individually or in the aggregate, classified as a finance leasing arrangement. The following is a schedule of the maturities of operating lease liabilities for the next five years as of December 31, 2018, and thereafter, based on agreements that were signed as of December 31, 2018: 2019 $ 523 2020 350 2021 277 2022 163 2023 140 Thereafter 156 Total leases payments $ 1,609 |
Subsequent events
Subsequent events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
Subsequent events | Note 18 - Subsequent events Regarding the issuance of 1,040,000 ordinary shares for aggregate gross proceed of $208 in January 2020, please see Note 11A. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Liquidity and Capital Resources | A. Liquidity and Capital Resources The Company has had recurring losses and currently has an accumulated deficit as of December 31, 2019 of $216,832. The Company also has a payable balance on its short-term loan of $2,478 that is due within the next 12 months. Since inception, the Company's principal sources of liquidity have been revenues, proceeds from sales of equity securities, borrowings from banks, cash from the exercise of options and warrants as well as proceeds from the divestiture of part of the Company's businesses. The Company had cash, cash equivalents and short-term investments representing bank deposits of $4,848 (of which an amount of $105 has been pledged as securities for certain items) as of December 31, 2019. The Company believes that it has sufficient capital resources to fund its operations for at least the next 12 months. Further, as disclosed in Note 11A, if certain conditions are met, including the approval of the Company's shareholders at the extraordinary general meeting of the shareholders that is scheduled for April 2020, the Company expects to receive funds in a total amount of up to $1,200 in consideration for the issuance of up to 6,000,000 Ordinary Shares, all in accordance with the terms and provisions of the Share Purchase Agreement (as defined in Note 11A below). As of the reporting date, it is hard to assess the future influence of the Corona Virus on the Company. The Company believes that one impact of the Corona Virus on the Company may be a decrease in the Company's revenues derived from Mass Transit activity in the Polish market. The Company is aware of no other material short term adverse influences on the Company. However, at this initial point in time, it is hard to predict what other impacts the Corona Virus may have on the Company. |
Financial statements in U.S. dollars | B. Financial statements in U.S. dollars Substantially all of the Company's and certain of its subsidiaries' revenues are in U.S. dollars. A significant portion of purchases of materials , Transactions and balances denominated in U.S. dollars are presented at their original amounts. For entities with a U.S. dollar functional currency, transactions and balances in other currencies are remeasured into U.S. dollars in accordance with the principles set forth in Accounting Standards Codification ("ASC") Topic 830, Foreign Currency Matters At each balance sheet date, recorded balances of monetary assets and liabilities that are denominated in a currency other than the functional currency are adjusted to reflect the current exchange rate. Exchange gains and losses from the remeasurement of such items denominated in non U.S. dollar currencies are reflected in the consolidated statements of operations, among 'financial expenses, net', as appropriate. The functional currency of the Company's subsidiary in South Africa changed in October 2017 from the South African Rand to U.S. dollar. This change resulted from a change in relevant circumstances whereby sales transactions denominated in U.S. dollars became the primary source of sales revenue. The functional currency of the Polish subsidiary is its local currency. The financial statements of companies with a functional currency that is not the U.S. dollar are translated into U.S. dollars using the exchange rate at the balance sheet date for assets and liabilities, and weighted average exchange rates for revenues and expenses (which approximates the translation of each transaction). Translation adjustments resulting from the process of the aforesaid translation are included as a separate component of equity (accumulated other comprehensive gain or loss). |
Principles of consolidation | C. Principles of consolidation The consolidated financial statements include the financial statements of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated in consolidation. |
Estimates and assumptions | D. Estimates and assumptions The preparation of the consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the year. Such estimates include the valuation of useful lives of long-lived assets, revenue recognition, valuation of accounts receivable and allowance for doubtful accounts, valuation of inventories, legal contingencies, the assumptions whether renewal options of lease period of buildings will be exercised in the future, the assumptions used in the calculation of stock-based compensation, income taxes and other contingencies. Estimates and assumptions are periodically reviewed by management and the effects of any material revisions are reflected in the period that they are determined to be necessary. Actual results, however, may vary from these estimates. |
Cash equivalents | E. Cash equivalents Cash equivalents are short-term highly liquid investments and debt instruments that are readily convertible to cash with original maturities of three months or less from the date of purchase. Bank deposits with original maturities of more than three months, or specific deposits that are intended to be held as bank deposits for more than three months, and which will mature within one year, are classified as short-term investments. |
Trade receivables | F. Trade receivables Trade receivables are recorded at the invoiced amount and do not bear interest. Collections of trade receivables are included in net cash provided by operating activities in the consolidated statements of cash flows. The consolidated financial statements include an allowance for loss from receivables for which collection is in doubt. In determining the adequacy of the allowance consideration is given to each trade receivable historical experience, aging of the receivable, adjusted to take into account current market conditions and information available about specific debtors, including their financial condition, current payment patterns, the volume of their operations, and evaluation of the security received from them or their guarantors. |
Short-term investments | G. Short-term investments Short-term investments consist of: (1) Bank deposits whose maturities are longer than three months from the date of purchase, but not longer than one year from the balance sheet date. (2) Bank deposits whose maturities are less than three months from the date of purchase, but are intended to be held as bank deposits for more than three months. (3) Restricted bank deposits whose maturities are not longer than one year from the balance sheet date (for further details, see Note 9C). |
Inventories | H. Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined by calculating raw materials, work in process and finished products on a "moving average" basis. Net realizable value is defined as the "estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation." Inventory write-offs are provided to cover risks arising from slow moving items or technological obsolescence. Such write-offs have been included in cost of revenues. |
Property, plant and equipment, net | I. Property, plant and equipment, net Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets as follows: Years Buildings 25 Computers, software and manufacturing equipment 3-5 Office furniture and equipment 5-16 (mainly - 10) Leasehold improvements are amortized by the straight-line method over the shorter of the lease term or the estimated useful economic life of such improvements. |
Impairment of long-lived assets | J. Impairment of long-lived assets Long-lived assets, such as right-of-use assets due to operating leases, property, plant, and equipment, and intangible assets subject to amortization, are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If circumstances require a long-lived asset to be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by an asset to the carrying value of the asset. If the carrying value of the long-lived asset is not recoverable on an undiscounted cash flow basis, impairment is recognized to the extent that the carrying value exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. |
Revenue recognition | K. Revenue recognition Accounting policy applicable before January 1, 2018: The Group generates revenues from product sales manufactured based on the Company's technology. In addition, the Company generates revenues from the technology it developed through transaction fee arrangements and licensing agreements. Revenues are also generated from non-recurring engineering, customer services and technical support. Revenues from product sales and non-recurring engineering are recognized when delivery has occurred provided there is persuasive evidence of an agreement, the fee is fixed or determinable, collection of the related receivable is probable and no further obligations exist. In the case of non-recurring engineering, revenue is recognized upon completion of testing and approval of the customization of the product by the customer, provided that no further obligation exists. Revenues are recognized net of value added tax. License and transaction fees are recognized as earned based on actual usage. Usage is determined by receiving confirmation from the users. Revenues relating to customer services and technical support are recognized as the services are rendered ratably over the term of the related contract. Licensing and transaction fees are recognized based on the volume of transactions or monthly licensing fees from systems that contain the Company's products and usually bear no cost to the Company. The cost to the Company of warranty that the product will perform according to certain specifications and that the Company will repair or replace the product if it ceases to work properly, is insignificant and is treated according to accounting guidance for contingencies. Accounting policy applicable after January 1, 2018: In May 2014, the Financial Accounting Standards Board ("FASB") issued ASC Topic 606, Revenue from Contracts with Customers The Company has adopted Topic 606 commencing from January 1, 2018 on a modified retrospective basis. Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting under Topic 605. The Company utilized a comprehensive approach in order to assess the impact of the guidance on its contract portfolio by reviewing its current accounting policies and practices to identify potential differences that would result from applying the new requirements, including evaluation of the performance obligations and variable consideration. The Company did not have a cumulative adjustment to retained earnings or an impact on its revenue recognition policies or on its consolidated financial statements as a result of the adoption of the new standard. Topic 606 requires entities to follow a five-step process: (1) Identify the contract(s) with a customer, (2) Identify the performance obligations in the contract, (3) Determine the transaction price, (4) Allocate the transaction price to the performance obligations in the contract, and (5) Recognize revenue when (or as) the entity satisfies a performance obligation. The Company accounts for a contract with a customer when it has approval and commitment from both parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. For each contract, the Company exercises judgement to identify separate performance obligations and to evaluate, at the inception of the contract, if each distinct performance obligation within the contract is satisfied at a point in time or over time. Revenue is measured based on a consideration specified in a contract with a customer, and excludes any sales incentives and amounts collected on behalf of third parties. In certain arrangements with variable consideration, the Company exercises judgement in order to estimate the amount of variable consideration to be included in the transaction price. In these arrangements, revenue is recognized over time as it is mainly attributed to ongoing services provided. Revenue is allocated among performance obligations in a manner that reflects the consideration that the Company expects to be entitled for the promised goods or services based on standalone selling prices "SSP". SSP are estimated for each distinct performance obligation and judgment may be required in their determination. The best evidence of SSP is the observable price of a product or service when the Company sells the goods separately in similar circumstances and to similar customers. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. For an analysis of the performance obligations and the timing of revenue recognition, for each type of the contract, see also Note 10. The new standard requires the Company to provide more robust disclosures than required by previous guidance. Such disclosures have been provided in Note 10. In addition, when the Company has an unconditional right to receive proceeds before the performance obligation was fulfilled, it is now required to record receivables against contract liabilities. |
Research, development costs and intangible assets | L. Research, development costs and intangible assets Research and development costs, which consist mainly of labor costs, materials and subcontractors, are charged to operations as incurred. In accordance with ASC Topic 350-40, "Internal Use Software" According to ASC Topic 350, " Intangibles - Goodwill and Other Amortization expenses amounted to $202, $215 and $181 for the years ended December 31, 2019, 2018 and 2017, respectively. The amortization is presented within research and development in the consolidated statements of operations. |
Stock-based compensation | M. Stock-based compensation The Company measures and recognizes compensation expense for all stock-based payment awards made to employees and directors based on estimated grant date fair values. The estimated fair value of awards is charged to income on a straight-line basis over the requisite service period, which is generally the vesting period. ASC Topic 718, Compensation – Stock Compensation The Company estimates forfeitures based on historical experience. The Company elected to recognize compensation cost for awards with only service conditions that have a graded vesting schedule using the straight-line method. |
Basic and diluted net loss per share | N. Basic and diluted net loss per share Basic and diluted net loss per ordinary share is computed based on the weighted average number of ordinary shares outstanding during each year. Shares issuable for little or no cash consideration, are considered outstanding ordinary shares and included in the computation of basic net loss per ordinary share as of the date that all necessary conditions have been satisfied. In years that discontinued operations are presented, the Company uses income from continuing operations (attributable to the parent entity) as the benchmark to determine whether potential common shares are dilutive or antidilutive. Therefore, when the Company records a loss from continuing operations and the issuance of option shares would be antidilutive due to the loss, but the Company has net income from discontinued operations, potential shares are excluded from the diluted calculation even though the effect on net income from discontinued operations would be dilutive. Stock options and warrants in the amounts of 809,000, 1,501,000 and 1,535,000 outstanding as of the years ended December 31, 2019, 2018 and 2017, respectively, have been excluded from the calculation of the diluted net loss per ordinary share because all such securities have an anti-dilutive effect for all periods presented. |
Fair value of financial instruments | O. Fair value of financial instruments The Company's financial instruments consist mainly of cash and cash equivalents, short-term interest bearing investments, accounts receivable, restricted deposits for employee benefits, accounts payable and short-term and long-term loans. Fair value for the measurement of financial assets and liabilities is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company utilizes a valuation hierarchy for disclosure of the inputs for fair value measurement. This hierarchy prioritizes the inputs into three broad levels as follows: ● Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. ● Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ● Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. By distinguishing between inputs that are observable in the market place, and therefore more objective, and those that are unobservable and therefore more subjective, the hierarchy is designed to indicate the relative reliability of the fair value measurements. A financial asset or liability's classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The Company, in estimating fair value for financial instruments, determined that the carrying amounts of cash and cash equivalents, trade receivables, short-term bank credit and trade payables are equivalent to, or approximate their fair value due to the short-term maturity of these instruments. The carrying amounts of variable interest rate long-term loans are equivalent or approximate to their fair value as they bear interest at approximate market rates. |
Income tax | P. Income tax The Company accounts for taxes on income in accordance with ASC Topic 740, Income Taxes The Company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that is greater than 50 percent likely of being realized. The Company accounts for interest and penalties as a component of income tax expense. |
Severance pay | Q. Severance pay The Company's liability for severance pay for some of its Israeli employees is calculated pursuant to Israeli Severance Pay Law, 1963 (the "Israeli Severance Pay Law") based on the most recent salary of the employee multiplied by the number of years of employment, as of the balance sheet date. Those employees are entitled to one month's salary for each year of employment or a portion thereof. Certain senior executives were entitled to receive additional severance pay. The Company records the liability as if it were payable at each balance sheet date on an undiscounted basis. The liability is classified based on the expected date of settlement, and therefore is usually classified as a long-term liability, unless the cessation of the employees is expected during the upcoming year. The Company's liability for those Israeli employees is partially provided for by monthly deposits for insurance policies and the remainder by an accrual. The value of these policies is recorded as an asset in the Company's balance sheet. The deposited funds include profits and losses accumulated up to the balance sheet date. The deposited funds may be withdrawn only upon the fulfillment of the obligation pursuant to the Israeli Severance Pay Law or labor agreements. The value of the deposited funds is based on the cash redemption value of these policies. In addition, the Company has deposited certain amounts with a trustee, to compensate for any severance pay liability that is not covered by other funds. These deposits are restricted and may be withdrawn only for payment of severance pay liabilities. The severance pay funds and the restricted deposits for employee benefits are classified based on the classification of the corresponding liability. In respect of other Israeli employees, the Company acts pursuant to the general approval of the Israeli Ministry of Labor and Welfare, pursuant to the terms of Section 14 of the Israeli Severance Pay Law, according to which the current deposits with the pension fund and/or with the insurance company exempt the Company from any additional obligation to these employees for whom the said depository payments are made. These deposits are accounted as defined contribution payments. Severance pay expenses for the years ended December 31, 2019, 2018 and 2017 amounted to $275, $212 and $242, respectively. Defined contribution plan expenses were $231, $232 and $231 in the years ended December 31, 2019, 2018 and 2017, respectively. |
Advertising expenses | R. Advertising expenses Advertising expenses are charged to the statements of operations as incurred. Advertising expenses for the years ended December 31, 2019, 2018 and 2017 amounted to $1,015, $1,367 and $1,254, respectively. |
Concentrations of credit or business risk | S. Concentrations of credit or business risk Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents, bank deposits and trade receivables. Cash equivalents are invested mainly in U.S. dollars with major banks in Israel and Europe. Management believes that the financial institutions that hold the Group's investments are financially sound and, accordingly, minimal credit risk exists with respect to these investments. Most of the Company's trade receivables are derived from sales to large and financially secure organizations. In determining the adequacy of the allowance, management bases its opinion, inter alia, on the estimated risks, current market conditions and in reliance on available information with respect to the debtor's financial position. As for major customers, see Note 16. The Company acquires certain components of its products from single source manufacturers. The activity in the allowance for doubtful accounts for the years ended December 31, 2019, 2018 and 2017 is as follows: 2019 2018 2017 Allowance for doubtful accounts at beginning of year $ 555 $ 568 $ 720 Additions charged to allowance for doubtful accounts 54 52 73 Write-downs charged against the allowance (10 ) (45 ) (225 ) Other 13 (20 ) - Allowance for doubtful accounts at end of year $ 612 $ 555 $ 568 |
Commitments and contingencies | T. Commitments and contingencies Liabilities for loss contingencies arising from claims, assessments, litigations, fines and penalties and other sources are recognized when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. Loss recovery related to recovery of a loss when the recovery is less than or equal to the amount of the loss recognized in the financial statements is recognized if collection is probable and estimable. Gain contingencies are recognized only when resolved. |
Business divestures | U. Business divestures As described in Note 1B, the Company has sold certain operations. Upon reaching a definitive agreement with an acquirer, the Company recognizes the consideration received from the divesture, less all assets and liabilities sold, as a gain or loss. Discontinued operations Upon divesture of a business, the Company classifies such business as a discontinued operation, if the divested business represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results. For disposals other than by sale such as abandonment, the results of operations of a business would not be recorded as a discontinued operation until the period in which the business is actually abandoned. The SmartID Division divesture and the Medismart divesture qualify as discontinued operations and therefore have been presented as such. The results of businesses that have qualified as discontinued operations have been presented as such for all reporting periods. Results of discontinued operations include all revenues and expenses directly derived from such businesses; general corporate overhead is not allocated to discontinued operations. Any loss or gain that arose from the divesture of a business that qualifies as discontinued operations has been included within the results of the discontinued operations. The Company also presents cash flows from discontinued operations separately from cash flows of continuing operations. Contingent consideration The Company's sale arrangements consist of contingent consideration based on the divested businesses' future sales or profits. The Company records the contingent consideration portion of the arrangement when the consideration is determined to be realizable. |
Restricted Cash and Cash Equivalents in Statement of Cash Flows | V. Restricted Cash and Cash Equivalents in Statement of Cash Flows In December 2016, the FASB issued Accounting Standards Update ("ASU") 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash and cash equivalents reported within the accompanying consolidated balance sheets that sum to the total of the same such amounts presented in the accompanying consolidated statements of cash flows: December 31 2019 2018 2017 Cash and cash equivalents $ 2,543 $ 4,827 $ 6,742 Restricted cash and cash equivalents (*) 105 278 1,057 Total cash, cash equivalents, and restricted cash and cash equivalents presented in the statements of cash flows $ 2,648 $ 5,105 $ 7,799 (*) The restricted cash and cash equivalents are included in short-term investments in the accompanying consolidated balance sheets. |
Recently Adopted Accounting Pronouncements | W. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes ASC 840, Leases. This ASU requires lessees to recognize a right-of-use asset and lease liability on the balance sheet for most leases, whereas until December 31, 2018, only financing-type lease liabilities (capital leases) were recognized on the balance sheet. Right-of-use assets represent a company's right to use an underlying asset for the lease term and lease liabilities represent a company's obligation to make lease payments arising from the lease. Operating and finance lease right-of-use assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of the lease payments. In addition, the definition of a lease in the ASU has been revised with respect to when an arrangement conveys the right to control the use of the identified asset under the arrangement, which may result in changes to the classification of an arrangement as a lease. The ASU does not significantly change the lessees' recognition, measurement and presentation of expenses and cash flows from the previous accounting standard. Lessors' accounting under the ASU is largely unchanged from the previous accounting standard. The ASU expands the disclosure requirements of lease arrangements. The Company has adopted ASU 2016-02 commencing from January 1, 2019, under the effective date method . The Company did not have a cumulative-effect adjustment to retained earnings as a result of the adoption of the new standard. The adoption of this standard does not have a material impact on the results of operations and cash flows. See Note 17 for the impact on the balance sheet as of December 31, 2019, and additional disclosures, as required by the new standard. |
Recent accounting pronouncements | X. Recent accounting pronouncements 1. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326). The main objective of this ASU is to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To achieve this objective, the amendments in this ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments affect entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2018. The Company currently does not expect the adoption of this accounting standard to have a material impact on its consolidated financial statements 2. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This ASU, among other things, removes the exception to the incremental approach for intraperiod allocation of tax expense when a company has a loss from continuing operations and income from other items that are not included in continuing operations, such as income from discontinued operations, or income recorded in other comprehensive income. The general rule under ASC 740-20-45-7 is that the tax effect of pretax income or loss from continuing operations should be determined by a computation that does not consider the tax effects of items that are not included in continuing operations. Previously, companies could consider the impact on a loss from continuing operations of items in discontinued operations or other comprehensive income. However, under the amended guidance, companies should not consider the effect of items outside of continuing operations in calculating the tax effect on continuing operations. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted, with the amendments to be applied on a retrospective, modified retrospective or prospective basis, depending on the specific amendment. The Company |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of property, plant and equipment estimated useful lives of the assets | Years Buildings 25 Computers, software and manufacturing equipment 3-5 Office furniture and equipment 5-16 (mainly - 10) |
Schedule of allowance for doubtful accounts | 2019 2018 2017 Allowance for doubtful accounts at beginning of year $ 555 $ 568 $ 720 Additions charged to allowance for doubtful accounts 54 52 73 Write-downs charged against the allowance (10 ) (45 ) (225 ) Other 13 (20 ) - Allowance for doubtful accounts at end of year $ 612 $ 555 $ 568 |
Schedule of reconciliation of cash, cash equivalents, and restricted cash and cash equivalents | December 31 2019 2018 2017 Cash and cash equivalents $ 2,543 $ 4,827 $ 6,742 Restricted cash and cash equivalents (*) 105 278 1,057 Total cash, cash equivalents, and restricted cash and cash equivalents presented in the statements of cash flows $ 2,648 $ 5,105 $ 7,799 |
Other Receivables and Prepaid_2
Other Receivables and Prepaid Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Receivables and Prepaid Expenses [Abstract] | |
Schedule of other receivables and prepaid expenses | December 31 2019 2018 Government institutions $ 414 $ 387 Prepaid expenses 224 226 Receivables under contractual obligations to be transferred to others (*) 330 349 Suppliers advance 544 932 Other receivables 310 166 $ 1,822 $ 2,060 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Note 5 - Inventories December 31 2019 2018 Raw materials $ 1,497 $ 1,331 Finished products 1,835 2,196 $ 3,332 $ 3,527 |
Property, Plant and Equipment_2
Property, Plant and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment, net | December 31 2019 2018 Cost Buildings and leasehold improvements (*) $ 278 $ 966 Computers, software and manufacturing equipment 15,630 16,052 Office furniture and equipment 253 153 Motor vehicles 173 195 Total cost 16,334 17,366 Total accumulated depreciation 12,640 12,333 $ 3,694 $ 5,033 (*) See also Note 12 in connection with sale of the building in South Africa. |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Liabilities, Current [Abstract] | |
Schedule of other current liabilities | December 31 2019 2018 Employees and related expenses $ 613 $ 1,042 Accrued expenses 887 921 Customer advances 111 141 Short-term liabilities due to operating leases and current maturities (**) 686 - Other current liabilities (*)757 (*)1,518 $ 3,054 $ 3,622 (*) The balances as of December 31, 2019 and 2018 include provisions in amounts of $552 and $1,370, as mentioned in Note 14 and Note 9E(1), respectively. (**) See Note 2W. |
Bank Loans (Tables)
Bank Loans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of long-term loans | December 31 2019 2018 Long-term loans (*) $ 24 $ 299 Less - current maturities 2 260 $ 22 $ 39 (*) As of December 31, 2019, the bank loans are denominated in South African Rand. |
Schedule of short-term loans, bank credit, and current maturities of long-term debt | December 31 December 31 2019 2019 2018 % Interest rate In U.S. Dollars (*) 3.60 $ 2,020 $ - In NIS 5.12 456 - 2,476 - Current maturities of long-term loans 2 260 $ 2,478 $ 260 (*) On May 24, 2019, ASEC S.A. (Spolka Akcyjna), the Polish subsidiary of the Company (hereinafter – “ASEC”), entered into a loan agreement with PKO Bank Polski, a Polish bank (hereinafter – “the Lender”). The agreement provides that the Lender will grant an overdraft facility to ASEC in the amount of $2,000. On May 24, 2019 the Lender loaned to ASEC the full amount of the loan, secured by certain assets of ASEC (hereinafter – “the Secured Loan”). The Secured Loan matures on May 23, 2020. The loan will be payable in full on maturity (with option of early repayment by ASEC) and the interest is paid on a monthly basis. The Secured Loan bears interest at an annual interest rate based on 1-month LIBOR plus a margin of 1.8%, or currently approximately 3.6% in total. The agreement includes customary events of default, including, among others, failures to repay any amounts due to the Lender, breaches or defaults under the terms of the agreement, etc. If an event of default occurs, the Lender may reduce the amount of the Secured Loan, demand an additional security or terminate the agreement. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of minimum future rentals of premises under non-cancelable operating lease agreements | 2020 $ 738 2021 675 2022 558 2023 322 2024 (*)543 $ 2,836 (*) The table above includes, among other things, the minimum future rentals of the headquarter office in Yokne’am, Israel (in lieu of the previous leased headquarters building in Rosh Pina), that the Company has leased since January 2020, subsequent to the balance sheet date, due to the fact that its lease agreement was signed as of December 31, 2019. The operating lease period of this office is five years (excluding the extension-period, as mentioned in the agreement). The total annual rent expenses of this building, including management fees and excluding construction costs-reimbursement, is approximately NIS 595 ($172). The construction costs-reimbursement is approximately NIS 2,913 ($843), out of which 50% will be paid during the lease period . |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue | Year ended December 31 2019 Retail and Mass Transit Ticketing Petroleum Total Cashless payment products (A) $ 6,156 $ - $ 6,156 Complete cashless payment solutions (B): Sales of products (B1) 773 1,964 2,737 Licensing fees, transaction fees and services (B2) 4,580 1,278 5,858 5,353 3,242 8,595 Total revenues $ 11,509 $ 3,242 $ 14,751 Year ended December 31 2018 Retail and Mass Transit Ticketing Petroleum Total Cashless payment products (A) $ 8,751 $ - $ 8,751 Complete cashless payment solutions (B): Sales of products (B1) 2,986 3,794 6,780 Licensing fees, transaction fees and services (B2) 4,890 1,457 6,347 7,876 5,251 13,127 Total revenues $ 16,627 $ 5,251 $ 21,878 |
Schedule of contract balances | December 31 December 31 2019 2018 Trade receivables, net of allowance for doubtful accounts $ 2,430 $ 4,530 Customer advances $ 111 $ 141 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Schedule of Black-Scholes model and assumptions | Year ended December 31 2019 2018 2017 Expected dividend yield 0 % 0 % 0 % Expected volatility 78%-88 % 69%-81 % 67%-74 % Risk-free interest rate 1.63%-2.47 % 1.92%-2.84 % 1.35%-1.83 % Expected life - in years 2.44 2.33 2.45 |
Schedule of stock options activity | Number of Weighted Aggregate Outstanding – December 31, 2018 1,461,000 $ 1.24 Options granted 260,000 0.51 Options expired or forfeited (912,000 ) 1.31 Outstanding – December 31, 2019 (*)809,000 $ 0.93 - Exercisable as of: December 31, 2019 505,657 $ 1.06 - (*) As of December 31, 2019, the shareholders meeting has not yet converged in order to approve a grant of 450,000 options to the Company’s Chief Executive Officer (hereinafter – “CEO”). Therefore, the options outstanding as of December 31, 2019, do not include those options. Each option shall be exercisable upon payment of the exercise price which will be equal to the average closing price of the share of Company during the trading days over the 30 calendar days prior to the date when the CEO’s employment agreement will be approved by the Company’s Shareholders. The options will be subject to a three-year vesting period starting on the CEO employment commencement date so that each portion of 150,000 options shall vest on each of the first, second and third anniversaries of the commencement date. |
Schedule of options outstanding and exercisable | Options outstanding Options Exercisable Number Weighted Number Weighted outstanding average Weighted Outstanding average Weighted as of remaining Average As of remaining Average Range of December 31, contractual Exercise December 31, contractual Exercise exercise price 2019 life (years) Price 2019 life (years) Price $ 0.44-0.90 333,000 3.54 $ 0.61 110,995 1.78 $ 0.77 $ 1.07-1.68 476,000 2.40 $ 1.15 394,662 2.30 $ 1.14 809,000 2.87 505,657 2.19 |
Supplemental statement of ope_2
Supplemental statement of operations data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Income and Expenses [Abstract] | |
Schedule of other expenses (income), net | Year ended December 31. 2019 2018 2017 (Gain) loss on sale of property and equipment, net (*) (328 ) (37 ) 52 Consulting fees - 70 - Other (13 ) - - Other (income) expenses, net $ (341 ) $ 33 $ 52 (*) In March 2019, OTI Petrosmart (Pty), Ltd., the South African subsidiary (hereinafter – “Petrosmart”), entered into an agreement pursuant to which Petrosmart agreed to sell its head office in Cape Town, South Africa, to a third party for consideration of Rand 15,500 (approximately $1,100), and Petrosmart agreed to lease back this building for its current operations. The sale has been completed and the operating lease commenced during the third quarter of 2019. The leaseback period is three years. The annual rent for the first year is approximately Rand 1,800 (approximately $128) and will be increased by 8.5% each year. Petrosmart has the right to extend the lease by two years. The Company recognized a profit in the amount of approximately $328 during the third quarter of 2019 due to the sale of the building. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of deferred tax assets and liabilities | December 31 December 31 2019 2018 Deferred tax assets: Carryforward losses $ 46,102 $ 44,926 Other 766 763 Total gross deferred tax assets 46,868 45,689 Less – valuation allowance (46,868 ) (45,689 ) Net deferred tax assets $ - $ - Deferred tax liability - Other * (416 ) (445 ) Net deferred tax liability $ (416 ) $ (445 ) * Relates mainly to property, plant and equipment. |
Summary of changes in valuation allowance | Year ended December 31 2019 2018 2017 Balance at beginning of year $ 45,689 $ 46,024 $ 46,450 Additions during the year from Continuing operations 1,233 122 413 Changes due to amendments to tax laws and applicable future tax rates, see Note 13A(3) - - (518 ) Discontinued operations - see Note 1B 164 (5 ) (239 ) Tax from previous years (169 ) (310 ) (312 ) Exchange rate differences on carryforward losses 13 (20 ) 244 Adjustments to beginning-of-the-year balance due to utilization of carryforward losses in certain subsidiaries - - (16 ) Deferred intercompany transactions (44 ) (122 ) - Other changes (18 ) - 2 Balance at end of year $ 46,868 $ 45,689 $ 46,024 |
Schedule of income tax (expense) benefit components | Year ended December 31 2019 2018 2017 Current income tax expenses $ (96 ) $ (161 ) $ (14 ) Current income tax benefits (expenses) from previous years 128 (15 ) (13 ) Deferred tax benefit 25 477 165 Income tax benefit, net $ 57 $ 301 $ 138 |
Schedule of loss from continuing operations before taxes on income | Year ended December 31 2019 2018 2017 Computed "expected" income tax benefit $ 1,203 $ 503 $ 606 Decrease in income tax benefit resulting from: Change in valuation allowance, net (1,233 ) (122 ) (413 ) Nondeductible stock-based compensation related to options issued to employees (29 ) (53 ) (61 ) Other nondeductible expenses (19 ) (3 ) (22 ) Tax from previous years 128 (15 ) (13 ) Other 7 (9 ) 41 Reported income tax benefit $ 57 $ 301 $ 138 |
Schedule of income (loss) before taxes on income | Year ended December 31 2019 2018 2017 Israel $ (5,526 ) $ (2,765 ) $ (2,906 ) Non-Israel 294 576 383 $ (5,232 ) $ (2,189 ) $ (2,523 ) |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of results of the discontinued operations | Year ended December 31 2019 2018 2017 Revenues $ - $ 1,722 $ 1,509 Expenses (232 ) (1,381 ) (1,068 ) Other (loss) income, net (*)(482 ) (**)1,284 (*)1,346 Net (loss) income from discontinued operations $ (714 ) $ 1,625 $ 1,787 (*) During the year ended December 31, 2017, the Company recorded $1,346 as 'other income, net' within the net income from discontinued operations based on a judgment issued by the Israeli Central District Court regarding the Company's lawsuit against Harel Insurance Company Ltd. ("Harel") for damages incurred by the Company due to flooding in a subcontractor's manufacturing site in 2011. The judgment determined that an amount of $1,600, net be awarded to cover the Company's damages. On October 10, 2017, Harel submitted its appeal of the judgment to the Israeli Supreme Court as well as a request for stay of judgment. On January 26, 2020, subsequent to the balance sheet date, Harel and the Company agreed to the offer of the Israeli Supreme Court, as made by way of settlement in which the Company will pay back to Harel the sum of NIS 1,907 (approximately $553) in three monthly equal installments starting February 26, 2020. The consolidated financial statements as of December 31, 2019, include provision in the amount of $553, out of which $482 is presented as 'other income, net' within the net loss from discontinued operations and $71 is presented as 'general and administrative expenses' within the net loss from continuing operations. (**) During the year ended December 31, 2018, the total gain from the Medismart operation divesture, net of transaction costs, amounted to $2,639. This gain together with the expense in the amount of $1,355 that derives from a loss contingency, as mentioned in Note 9E(1), are included in 'other income, net' within the net income from discontinued operations. |
Operating Segments (Tables)
Operating Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of information regarding results of each reportable segment | Year ended December 31, 2019 Retail and Petroleum Consolidated Revenues $ 11,509 $ 3,242 $ 14,751 Reportable segment gross profit * 6,583 1,501 8,084 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (783 ) Stock-based compensation (5 ) Gross profit for the period $ 7,296 Year ended December 31, 2018 Retail and Petroleum Consolidated Revenues $ 16,627 $ 5,251 $ 21,878 Reportable segment gross profit * 9,441 2,557 11,998 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (826 ) Stock-based compensation (4 ) Gross profit for the period $ 11,168 Year ended December 31, 2017 Retail and Petroleum Consolidated Revenues $ 15,755 $ 5,118 $ 20,873 Reportable segment gross profit * 8,623 2,552 11,175 Reconciliation of reportable segment gross profit to gross profit for the period Depreciation (757 ) Stock-based compensation (1 ) Gross profit for the period $ 10,417 * Gross profit as reviewed by the CODM represents gross profit, adjusted to exclude depreciation and stock-based compensation. |
Geographic Information and Ma_2
Geographic Information and Major Customers (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of revenues by geographical areas from external customers | Year ended December 31 2019 2018 2017 Revenues by geographical areas from external customers Americas $ 3,625 $ 7,914 $ 7,167 Asia 1,074 3,122 3,421 Africa 2,087 2,447 2,814 Europe 7,965 8,395 7,295 Total export 14,751 21,878 20,697 Domestic (Israel) - - 176 $ 14,751 $ 21,878 $ 20,873 |
Schedule of long lived assets by geographical areas | December 31 December 31 2019 2018 Long lived assets by geographical areas Domestic (Israel) $ 1,846 $ 686 Poland 3,992 3,704 South Africa 496 884 America 19 - $ 6,353 $ 5,274 |
Schedule of major customers by percentage from total revenues | Year ended December 31 2019 2018 2017 % % % Major Customers by percentage from total revenues Customer A 21 % 15 % 16 % Customer B 0 % 9 % 12 % Customer C 4 % 11 % 11 % Customer D 15 % 7 % 4 % * The revenues derived from those three customers are presented within the revenues from the Retail and Mass Transit Ticketing. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of the maturities of operating lease liabilities | 2020 $ 821 2021 689 2022 496 2023 191 2024 118 Thereafter 29 Total leases payments 2,344 Less - discount 175 Operating lease liabilities $ 2,169 2019 $ 523 2020 350 2021 277 2022 163 2023 140 Thereafter 156 Total leases payments $ 1,609 |
General (Details)
General (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Apr. 20, 2016 | Dec. 31, 2013USD ($) | Dec. 31, 2019Segments | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Total purchase price in cash | $ 2,750 | $ 10,000 | ||
Additional purchase price | $ 12,500 | |||
Settlement agreement resolving, description | On April 20, 2016, the purchaser of the Smart ID division, SuperCom Ltd. ("SuperCom"), and the Company entered into a settlement agreement resolving certain litigation between SuperCom and the Company pursuant to which SuperCom paid the Company $2,050 and agreed to pay the Company up to $1,500 in accordance with and subject to a certain earn-out mechanism. | |||
Number of operating segment | Segments | 2 |
Significant Accounting Polici_4
Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |
Property, Plant and Equipment, Estimated Useful Lives | (mainly - 10) |
Computers, software and manufacturing equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Buildings [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 25 years |
Minimum [Member] | Computers, software and manufacturing equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 3 years |
Minimum [Member] | Office furniture and equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Maximum [Member] | Computers, software and manufacturing equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 5 years |
Maximum [Member] | Office furniture and equipment [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life | 16 years |
Significant Accounting Polici_5
Significant Accounting Policies (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accounting Policies [Abstract] | |||
Allowance for doubtful accounts at beginning of year | $ 555 | $ 568 | $ 720 |
Additions charged to allowance for doubtful accounts | 54 | 52 | 73 |
Write-downs charged against the allowance | (10) | (45) | (225) |
Other | 13 | (20) | |
Allowance for doubtful accounts at end of year | $ 612 | $ 555 | $ 568 |
Significant Accounting Polici_6
Significant Accounting Policies (Details 2) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | |||||
Cash and cash equivalents | $ 2,543 | $ 4,827 | $ 6,742 | ||
Restricted cash and cash equivalents | [1] | 105 | 278 | 1,057 | |
Total cash, cash equivalents, and restricted cash and cash equivalents presented in the statements of cash flows | $ 2,648 | $ 5,105 | $ 7,799 | $ 7,500 | |
[1] | The restricted cash and cash equivalents are included in short-term investments in the accompanying consolidated balance sheets. |
Significant Accounting Polici_7
Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Significant Accounting Policies (Textual) | |||
Amortization expenses | $ 202 | $ 215 | $ 181 |
Amortization over a period | 3 years | ||
Stock options and warrants | 809,000 | 1,501,000 | 1,535,000 |
Severance pay expenses | $ 275 | $ 212 | $ 242 |
Defined contribution plan expenses | 231 | 232 | 231 |
Advertising expenses | 1,015 | 1,367 | $ 1,254 |
Bank deposits | 4,838 | ||
Pledged Security | 105 | ||
Funds yet to receive | $ 1,200 | ||
Shares issued | 6,000,000 | ||
Capitalized internal use software development costs | $ 483 | ||
Capitalized certification costs | 250 | ||
Accumulated deficit | (216,832) | (210,943) | |
Short-term bank credit | $ 2,478 | $ 260 | |
Software [Member] | |||
Significant Accounting Policies (Textual) | |||
Estimated useful life | 5 years |
Short-Term Investments (Details
Short-Term Investments (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Short-Term Investments (Textual) | ||
Weighted average annual interest | 1.82% | 2.29% |
Other Receivables and Prepaid_3
Other Receivables and Prepaid Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Other Receivables and Prepaid Expenses [Abstract] | |||
Government institutions | $ 414 | $ 387 | |
Prepaid expenses | 224 | 226 | |
Receivables under contractual obligations to be transferred to others | [1] | 330 | 349 |
Suppliers advance | 544 | 932 | |
Other receivables | 310 | 166 | |
Total other receivables and prepaid expenses | $ 1,822 | $ 2,060 | |
[1] | The Company's subsidiary in Poland is required to collect certain fees that are to be transferred to local authorities. |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,497 | $ 1,331 |
Finished products | 1,835 | 2,196 |
Inventories | $ 3,332 | $ 3,527 |
Property, Plant and Equipment_3
Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Total cost | $ 16,334 | $ 17,366 | |
Total accumulated depreciation | 12,640 | 12,333 | |
Net cost | 3,694 | 5,033 | |
Buildings and leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total cost | [1] | 278 | 966 |
Computers, software and manufacturing equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total cost | 15,630 | 16,052 | |
Office furniture and equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total cost | 253 | 153 | |
Motor vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total cost | $ 173 | $ 195 | |
[1] | See also Note 12 in connection with sale of the building in South Africa. |
Property, Plant and Equipment_4
Property, Plant and Equipment, Net (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment, Net (Textual) | |||
Depreciation expenses | $ 1,068 | $ 1,113 | $ 991 |
Other Current Liabilities (Deta
Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Other Liabilities, Current [Abstract] | |||
Employees and related expenses | $ 613 | $ 1,042 | |
Accrued expenses | 887 | 921 | |
Customer advances | 111 | 141 | |
Short-term liabilities due to operating leases and current maturities | [1] | 686 | |
Other current liabilities | [2] | 757 | 1,518 |
Total other current liabilities | $ 3,054 | $ 3,622 | |
[1] | See Note 2W. | ||
[2] | The balances as of December 31, 2019 and 2018 include provisions in amounts of $552 and $1,370, as mentioned in Note 14 and Note 9E(1), respectively. |
Other Current Liabilities (De_2
Other Current Liabilities (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Other Liabilities, Current [Abstract] | ||
Provision amount | $ 553 | $ 1,370 |
Bank Loans (Details)
Bank Loans (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Long-term Debt, Unclassified [Abstract] | |||
Long-term loans | [1] | $ 24 | $ 299 |
Less - current maturities | 2 | 260 | |
Long-term loans, net of current maturities | $ 22 | $ 39 | |
[1] | As of December 31, 2019, the bank loans are denominated in South African Rand. |
Bank Loans (Details 1)
Bank Loans (Details 1) ₪ in Thousands, $ in Thousands | Dec. 31, 2019USD ($) | Dec. 31, 2019ILS (₪) | Dec. 31, 2018USD ($) | |
Short-term Debt [Line Items] | ||||
Short-term loans and bank credit | [1],[2] | $ 2,476 | ||
Current maturities of long-term loans | 2 | 260 | ||
Total short-term loans, bank credit and current maturities of long-term loans | $ 2,478 | 260 | ||
U.S. Dollars [Member] | ||||
Short-term Debt [Line Items] | ||||
Interest rate | [3] | 3.60% | 3.60% | |
Short-term loans and bank credit | [3] | $ 2,020 | ||
NIS [Member] | ||||
Short-term Debt [Line Items] | ||||
Interest rate | 5.12% | 5.12% | ||
Short-term loans and bank credit | ₪ 456 | |||
[1] | See Note 2A. | |||
[2] | See Note 2W. | |||
[3] | On May 24, 2019, ASEC S.A. (Spolka Akcyjna), the Polish subsidiary of the Company (hereinafter - "ASEC"), entered into a loan agreement with PKO Bank Polski, a Polish bank (hereinafter - "the Lender"). The agreement provides that the Lender will grant an overdraft facility to ASEC in the amount of $2,000. On May 24, 2019 the Lender loaned to ASEC the full amount of the loan, secured by certain assets of ASEC (hereinafter - "the Secured Loan"). The Secured Loan matures on May 23, 2020. The loan will be payable in full on maturity (with option of early repayment by ASEC) and the interest is paid on a monthly basis. The Secured Loan bears interest at an annual interest rate based on 1-month LIBOR plus a margin of 1.8%, or currently approximately 3.6% in total. The agreement includes customary events of default, including, among others, failures to repay any amounts due to the Lender, breaches or defaults under the terms of the agreement, etc. If an event of default occurs, the Lender may reduce the amount of the Secured Loan, demand an additional security or terminate the agreement. |
Bank Loans (Details Textual)
Bank Loans (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | ||
May 24, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Bank Loans (Textual) | |||
Loans bear interest rate | 3.60% | ||
Weighted average interest rate | 3.88% | 3.82% | |
Credit lines authorized | $ 1,694 | ||
Description of loan agreement | ASEC S.A. (Spolka Akcyjna), the Polish subsidiary of the Company (hereinafter – "ASEC"), entered into a loan agreement with PKO Bank Polski, a Polish bank (hereinafter – "the Lender"). The agreement provides that the Lender will grant an overdraft facility to ASEC in the amount of $2,000. On May 24, 2019 the Lender loaned to ASEC the full amount of the loan, secured by certain assets of ASEC (hereinafter – "the Secured Loan"). The Secured Loan matures on May 23, 2020. The loan will be payable in full on maturity (with option of early repayment by ASEC) and the interest is paid on a monthly basis. The Secured Loan bears interest at an annual interest rate based on 1-month LIBOR plus a margin of 1.8%, or currently approximately 3.6% in total. | ||
Polish bank [Member] | |||
Bank Loans (Textual) | |||
Bank loans | $ 2,000 | ||
Maturity range | May 23, 2020 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2019USD ($) | |
Minimum future rentals: | ||
2020 | $ 738 | |
2021 | 675 | |
2022 | 558 | |
2023 | 322 | |
2024 | 543 | [1] |
Total | $ 2,836 | |
[1] | The table above includes, among other things, the minimum future rentals of the headquarter office in Yokne'am, Israel (in lieu of the previous leased headquarters building in Rosh Pina), that the Company has leased since January 2020, subsequent to the balance sheet date, due to the fact that its lease agreement was signed as of December 31, 2019. The operating lease period of this office is five years (excluding the extension-period, as mentioned in the agreement). The total annual rent expenses of this building, including management fees and excluding construction costs-reimbursement, is approximately NIS 595 ($172). The construction costs-reimbursement is approximately NIS 2,913 ($843), out of which 50% will be paid during the lease period. If the Company will lease this office during the extension-period of five years, the rest of 50% will be paid during the extension-period. Otherwise, the 50% will be paid at the end 2024, as taken into account in the table above. |
Commitments and Contingencies_3
Commitments and Contingencies (Details Textual) € in Thousands, ₪ in Thousands, $ in Thousands | Jan. 08, 2019USD ($) | Jan. 08, 2019ILS (₪) | Oct. 25, 2017USD ($) | Oct. 25, 2017EUR (€) | Feb. 21, 2016USD ($) | Oct. 31, 2013USD ($) | Oct. 31, 2013EUR (€) | Dec. 31, 2019USD ($) | Dec. 31, 2017USD ($) |
Commitments and Contingencies (Textual) | |||||||||
Royalty expenses | $ 111 | ||||||||
Grants received, net of royalties paid | $ 3,400 | ||||||||
Grants in period | 3 years | ||||||||
Lease expiration dates, description | Expiring in years 2020 through 2024. | ||||||||
Operating lease, description | The total annual rent expenses of this building, including management fees and excluding construction costs-reimbursement, is approximately NIS 595 ($172). The construction costs-reimbursement is approximately NIS 2,913 ($843), out of which 50% will be paid during the lease period. If the Company will lease this office during the extension-period of five years, the rest of 50% will be paid during the extension-period. Otherwise, the 50% will be paid at the end 2024, as taken into account in the table above. | ||||||||
Short-term deposits respect of guarantees granted | $ 105 | ||||||||
Guarantees to secure customer advances | $ 404 | ||||||||
Guarantees expiration dates description | The expiration dates of the guarantees range from April 2020 to September 2021. | ||||||||
Payment of interest plus and cost | $ 57 | ||||||||
Other fees and penalties | $ 6 | ||||||||
Minimum [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Percentage of sales paid as royalties | 3.00% | ||||||||
Maximum [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Percentage of sales paid as royalties | 3.50% | ||||||||
EUR [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Payment of interest plus and cost | € | € 50 | ||||||||
Other fees and penalties | € | € 5 | ||||||||
Merwell Inc. [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Outstanding commissions arbitration | $ 855 | ||||||||
Financial claim field | $ 1,618 | ||||||||
Payment of interest plus and cost | $ 1,370 | ||||||||
Merwell Inc. [Member] | NIS [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Payment of interest plus and cost | ₪ | ₪ 5,080 | ||||||||
Parx France [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Financial claim field | $ 573 | ||||||||
Parx France [Member] | EUR [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Financial claim field | € | € 503 | ||||||||
French Company [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Financial claim field | $ 1,708 | ||||||||
French Company [Member] | EUR [Member] | |||||||||
Commitments and Contingencies (Textual) | |||||||||
Financial claim field | € | € 1,500 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disaggregation of Revenue [Line Items] | ||||
Cashless payment products | [1] | $ 6,156 | $ 8,751 | |
Complete cashless payment solutions: | ||||
Sales of products | [2],[3] | 2,737 | 6,780 | |
Licensing fees, transaction fees and services | [2],[4] | 5,858 | 6,347 | |
Total | [2] | 8,595 | 13,127 | |
Total revenues | 14,751 | 21,878 | $ 20,873 | |
Petroleum [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Cashless payment products | [1] | |||
Complete cashless payment solutions: | ||||
Sales of products | [2],[3] | 1,964 | 3,794 | |
Licensing fees, transaction fees and services | [2],[4] | 1,278 | 1,457 | |
Total | [2] | 3,242 | 5,251 | |
Total revenues | 3,242 | 5,251 | ||
Retail and Mass Transit Ticketing [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Cashless payment products | [1] | 6,156 | 8,751 | |
Complete cashless payment solutions: | ||||
Sales of products | [2],[3] | 773 | 2,986 | |
Licensing fees, transaction fees and services | [2],[4] | 4,580 | 4,890 | |
Total | [2] | 5,353 | 7,876 | |
Total revenues | $ 11,509 | $ 16,627 | ||
[1] | Cashless payment products - The performance obligation is the selling of contactless payment products. Most of those products are Near Field Communication (NFC) readers. For such sales the performance obligation, transfer of control and revenue recognition occur when the products are delivered. | |||
[2] | Complete cashless payment solutions - The complete solution includes selling of products and complementary services, as follows: 1. Sales of products - Selling of contactless payment products (see A above) together with payment gateways and machine-to-machine controllers. Selling of petroleum payment solutions including site and vehicle equipment. For such sales, the performance obligation, transfer of control and revenue recognition occur when the products are delivered. 2. Licensing fees, transaction fees and services - The types of arrangements and their main performance obligations are as follows: To provide terminal management system licensing for software that is responsible for remote terminal management and cloud-based software licensing which provide data insights. For such services, the revenue recognition occurs as the services are rendered since the performance obligation is satisfied over time. To enable loading and sale of electronic contactless and paper cards. For such transaction fees, the revenue recognition occurs on the transaction date. To provide technical and customer services for products. For such services, the performance obligation is satisfied over time and therefore revenue recognition occurs as the services are rendered. | |||
[3] | Sales of products - Selling of contactless payment products (see A above) together with payment gateways and machine-to-machine controllers. Selling of petroleum payment solutions including site and vehicle equipment. For such sales, the performance obligation, transfer of control and revenue recognition occur when the products are delivered. | |||
[4] | Licensing fees, transaction fees and services - The types of arrangements and their main performance obligations are as follows: To provide terminal management system licensing for software that is responsible for remote terminal management and cloud-based software licensing which provide data insights. For such services, the revenue recognition occurs as the services are rendered since the performance obligation is satisfied over time. To enable loading and sale of electronic contactless and paper cards. For such transaction fees, the revenue recognition occurs on the transaction date. To provide technical and customer services for products. For such services, the performance obligation is satisfied over time and therefore revenue recognition occurs as the services are rendered. |
Revenues (Details 1)
Revenues (Details 1) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Revenue from Contract with Customer [Abstract] | ||
Trade receivables, net of allowance for doubtful accounts | $ 2,430 | $ 4,530 |
Customer advances | $ 111 | $ 141 |
Equity (Details)
Equity (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected life - in years | 2 years 5 months 9 days | 2 years 3 months 29 days | 2 years 5 months 12 days |
Minimum [Member] | |||
Expected volatility | 78.00% | 69.00% | 67.00% |
Risk-free interest rate | 1.63% | 1.92% | 1.35% |
Maximum [Member] | |||
Expected volatility | 88.00% | 81.00% | 74.00% |
Risk-free interest rate | 2.47% | 2.84% | 1.83% |
Equity (Details 1)
Equity (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Aggregate intrinsic value | ||||
Exercisable | $ 16 | $ 32 | ||
Stock Option Plans [Member] | ||||
Number of options outstanding | ||||
Outstanding - Beginning Balance | 1,461,000 | |||
Options granted | 260,000 | |||
Options expired or forfeited | (912,000) | |||
Outstanding - Ending Balance | 809,000 | [1] | 1,461,000 | |
Exercisable | 505,657 | |||
Weighted average exercise price per share | ||||
Outstanding - Beginning Balance | $ 1.24 | |||
Options granted | 0.51 | |||
Options expired or forfeited | 1.31 | |||
Outstanding - Ending Balance | 0.93 | $ 1.24 | ||
Exercisable | $ 1.06 | |||
Aggregate intrinsic value | ||||
Outstanding | ||||
Exercisable | ||||
[1] | As of December 31, 2019, the shareholders meeting has not yet converged in order to approve a grant of 450,000 options to the Company's Chief Executive Officer (hereinafter - "CEO"). Therefore, the options outstanding as of December 31, 2019, do not include those options. Each option shall be exercisable upon payment of the exercise price which will be equal to the average closing price of the share of Company during the trading days over the 30 calendar days prior to the date when the CEO's employment agreement will be approved by the Company's Shareholders. The options will be subject to a three-year vesting period starting on the CEO employment commencement date so that each portion of 150,000 options shall vest on each of the first, second and third anniversaries of the commencement date. |
Equity (Details 2)
Equity (Details 2) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Options outstanding | |
Number Outstanding | shares | 809,000 |
Weighted average remaining contractual life (years) | 2 years 10 months 14 days |
Options exercisable | |
Number outstanding | shares | 505,657 |
Weighted average remaining contractual life (years) | 2 years 2 months 8 days |
0.44-0.90 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, lower limit | $ 0.44 |
Exercise price, upper limit | $ 0.90 |
Options outstanding | |
Number Outstanding | shares | 333,000 |
Weighted average remaining contractual life (years) | 3 years 6 months 14 days |
Weighted Average Exercise Price | $ 0.61 |
Options exercisable | |
Number outstanding | shares | 110,995 |
Weighted average remaining contractual life (years) | 1 year 9 months 11 days |
Weighted Average Exercise Price | $ 0.77 |
1.07-1.68 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Exercise price, lower limit | 1.07 |
Exercise price, upper limit | $ 1.68 |
Options outstanding | |
Number Outstanding | shares | 476,000 |
Weighted average remaining contractual life (years) | 2 years 4 months 24 days |
Weighted Average Exercise Price | $ 1.15 |
Options exercisable | |
Number outstanding | shares | 394,662 |
Weighted average remaining contractual life (years) | 2 years 3 months 19 days |
Weighted Average Exercise Price | $ 1.14 |
Equity (Details Textual)
Equity (Details Textual) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||
Jun. 17, 2014 | Oct. 22, 2013 | Feb. 28, 2001 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2012 | Jan. 31, 2020 | Dec. 23, 2019 | |
Equity (Textual) | |||||||||
Ordinary shares | 5,460,000 | ||||||||
Aggregate gross proceeds of shares | $ 1,092 | ||||||||
Ordinary shares authorized | 50,000,000 | 50,000,000 | |||||||
Aggregate intrinsic value of exercisable options | $ 16 | $ 32 | |||||||
Warrants expires terms | During 2019, 40,000 warrants expired. | ||||||||
Outstanding warrants | 40,000 | ||||||||
Stock-based compensation expenses | $ 125 | $ 234 | $ 254 | ||||||
Fair value of shares vested | $ 157 | ||||||||
Weighted-average period | 1 year 1 month 9 days | ||||||||
Chief Executive Officer [Member] | |||||||||
Equity (Textual) | |||||||||
Options granted | 450,000 | ||||||||
Non employees [Member] | |||||||||
Equity (Textual) | |||||||||
Options granted | 30,000 | 80,000 | 45,000 | ||||||
Director [Member] | |||||||||
Equity (Textual) | |||||||||
Options granted | 75,000 | ||||||||
Employee [Member] | |||||||||
Equity (Textual) | |||||||||
Options granted | 75,000 | ||||||||
Consultant [Member] | |||||||||
Equity (Textual) | |||||||||
Options granted | 75,000 | ||||||||
Employee Stock Option [Member] | |||||||||
Equity (Textual) | |||||||||
Vesting period, description | The vesting period for the options ranges from immediate vesting to ratable vesting over a four- year period. The exercise price of options under the plan is at varying prices. Those options expire up to five years after the date of the grant. | ||||||||
Weighted average fair value of options granted | $ 0.19 | $ 0.46 | $ 0.66 | ||||||
Unrecognized compensation cost | $ 90 | ||||||||
Increased shares issued to share options | 750,000 | 2,500,000 | 150,000 | 13,125,000 | |||||
Minimum [Member] | |||||||||
Equity (Textual) | |||||||||
Ordinary shares authorized | 50,000,000 | ||||||||
Maximum [Member] | |||||||||
Equity (Textual) | |||||||||
Ordinary shares authorized | 100,000,000 | ||||||||
Common Stock [Member] | |||||||||
Equity (Textual) | |||||||||
Ordinary shares | 6,000,000 | ||||||||
Aggregate gross proceeds of shares | $ 1,200 | ||||||||
Subsequent Event [Member] | |||||||||
Equity (Textual) | |||||||||
Ordinary shares | 1,040,000 | ||||||||
Aggregate gross proceeds of shares | $ 208 | ||||||||
Private Placement [Member] | |||||||||
Equity (Textual) | |||||||||
Ordinary shares | 12,500,000 | ||||||||
Aggregate gross proceeds of shares | $ 2,500 |
Supplemental statement of ope_3
Supplemental statement of operations data (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Other Income and Expenses [Abstract] | ||||
(Gain) loss on sale of property and equipment, net | [1] | $ (328) | $ (37) | $ 52 |
Consulting fees | 70 | |||
Other | (13) | |||
Other (income) expenses, net | $ (341) | $ 33 | $ 52 | |
[1] | In March 2019, OTI Petrosmart (Pty), Ltd., the South African subsidiary (hereinafter - "Petrosmart'), entered into an agreement pursuant to which Petrosmart agreed to sell its head office in Cape Town, South Africa, to a third party for consideration of Rand 15,500 (approximately $1,100), and Petrosmart agreed to lease back this building for its current operations. The sale has been completed and the operating lease commenced during the third quarter of 2019. The leaseback period is three years. The annual rent for the first year is approximately Rand 1,800 (approximately $128) and will be increased by 8.5% each year. Petrosmart has the right to extend the lease by two years. The Company recognized a profit in the amount of approximately $328 during the third quarter of 2019 due to the sale of the building. |
Supplemental statement of ope_4
Supplemental statement of operations data (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended |
Mar. 31, 2019 | Sep. 30, 2019 | |
Supplemental Statement of Operations Data (Textual) | ||
Consideration received from sale of building | $ 1,100 | |
Leaseback period of agreement | 3 years | |
Annual rent | $ 128 | |
Annual rent increased percentage | 8.50% | |
Lease agreement terms extend | 2 years | |
Other operating loss | $ 328 | |
Rand [Member] | ||
Supplemental Statement of Operations Data (Textual) | ||
Consideration received from sale of building | $ 15,500 | |
Annual rent | $ 1,800 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets: | |||||
Carryforward losses | $ 46,102 | $ 44,926 | |||
Other | 766 | 763 | |||
Total gross deferred tax assets | 46,868 | 45,689 | $ 46,024 | $ 46,450 | |
Less - valuation allowance | (46,868) | (45,689) | |||
Net deferred tax assets | |||||
Deferred tax liability - | |||||
Other | [1] | (416) | (445) | ||
Net deferred tax liability | $ (416) | $ (445) | |||
[1] | Relates mainly to property, plant and equipment. |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Balance at beginning of year | $ 45,689 | $ 46,024 | $ 46,450 |
Additions during the year from Continuing operations | 1,233 | 122 | 413 |
Changes due to amendments to tax laws and applicable future tax rates, see Note 13A(3) | (518) | ||
Discontinued operations - see Note 1B | 164 | (5) | (239) |
Tax from previous years | (169) | (310) | (312) |
Exchange rate differences on carryforward losses | 13 | (20) | 244 |
Adjustments to beginning-of-the-year balance due to utilization of carryforward losses in certain subsidiaries | (16) | ||
Deferred intercompany transactions | (44) | (122) | |
Other changes | (18) | 2 | |
Balance at end of year | $ 46,868 | $ 45,689 | $ 46,024 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Current income tax expenses | $ (96) | $ (161) | $ (14) |
Current income tax benefits (expenses) from previous years | 128 | (15) | (13) |
Deferred tax benefit | 25 | 477 | 165 |
Income tax benefit, net | $ 57 | $ 301 | $ 138 |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Computed "expected" income tax benefit | $ 1,203 | $ 503 | $ 606 |
Decrease in income tax benefit resulting from: | |||
Change in valuation allowance, net | (1,233) | (122) | (413) |
Nondeductible stock-based compensation related to options issued to employees | (29) | (53) | (61) |
Other nondeductible expenses | (19) | (3) | (22) |
Tax from previous years | 128 | (15) | (13) |
Other | 7 | (9) | 41 |
Reported income tax benefit | $ 57 | $ 301 | $ 138 |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Israel | $ (5,526) | $ (2,765) | $ (2,906) |
Non-Israel | 294 | 576 | 383 |
Total | $ (5,232) | $ (2,189) | $ (2,523) |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | Jan. 04, 2016 | Dec. 22, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Income Taxes (Textual) | |||||
Corporate income tax rate | 23.00% | 23.00% | 24.00% | ||
Income tax, description | The U.S. Tax Cuts and Jobs Act (the “Tax Legislation”) was enacted in the United States. Except for certain provisions, the Tax Legislation was effective for tax years beginning on or after January 1, 2018. The Tax Legislation significantly revised several sections of the U.S. Internal Revenue Code including, among other things, lowering the corporate income tax rate from 35% to 21% effective January 1, 2018, limiting deductibility of interest expense and implementing a modified territorial tax system that imposes a repatriation tax on deemed repatriated earnings of foreign subsidiaries. The main effect on the Company’s U.S. subsidiary was the lowering the corporate income tax rate from 35% to 21%, which did not have a material effect on the Company’s financial statements. | ||||
Interest rate, description | 7.5% for Development Area A and 16% for the rest of the country. Additional amendments to the Law became effective in January 2017 (the “2017 Amendment”), according to which, subject to certain conditions, income derived by preferred companies which will meet the definition of ‘Preferred Technological Enterprises’ or “PTE” (as defined in the 2017 Amendment), would be subject to reduced corporate tax rates of 7.5% in Development Area A and 12% for the rest of the country. | ||||
Income tax rate, percentage | 20.00% | ||||
Undistributed earnings of foreign subsidiaries | $ 4,594 | ||||
Income tax expenses included in discontinued operations | $ 515 | $ 212 | |||
Statutory tax rates | 23.00% | 23.00% | 24.00% | ||
Tax Expire Period Two Zero Two Seven [Member] | |||||
Income Taxes (Textual) | |||||
Operating loss carryforwards | $ 2,814 | ||||
Tax Expire Period Two Zero Two Eight [Member] | |||||
Income Taxes (Textual) | |||||
Operating loss carryforwards | 533 | ||||
Corporate tax rate [Member] | |||||
Income Taxes (Textual) | |||||
Income tax, description | The statutory tax rate was changed to 25% following a reduction of a corporate tax by the Israeli government. Furthermore, on December 22, 2016, the Israeli government passed a law under which the corporate tax rate was reduced from 25% to 23% in two steps. The first reduction was to a rate of 24% as from January 2017 and the second reduction was to a rate of 23% as from January 2018. | ||||
Domestic Tax Authority [Member] | |||||
Income Taxes (Textual) | |||||
Operating loss carryforwards | 159,815 | ||||
Capital loss carry forwards | 37,375 | ||||
Foreign Tax Authority [Member] | |||||
Income Taxes (Textual) | |||||
Operating loss carryforwards | $ 3,347 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||||
Discontinued Operations and Disposal Groups [Abstract] | ||||||
Revenues | $ 1,722 | $ 1,509 | ||||
Expenses | (232) | (1,381) | (1,068) | |||
Other (loss) income, net | (482) | [1] | 1,284 | [2] | 1,346 | [1] |
Net (loss) income from discontinued operations | $ (714) | $ 1,625 | $ 1,787 | |||
[1] | During the year ended December 31, 2017, the Company recorded $1,346 as 'other income, net' within the net income from discontinued operations based on a judgment issued by the Israeli Central District Court regarding the Company's lawsuit against Harel Insurance Company Ltd. ("Harel") for damages incurred by the Company due to flooding in a subcontractor's manufacturing site in 2011. The judgment determined that an amount of $1,600, net be awarded to cover the Company's damages. On October 10, 2017, Harel submitted its appeal of the judgment to the Israeli Supreme Court as well as a request for stay of judgment.On January 26, 2020, subsequent to the balance sheet date, Harel and the Company agreed to the offer of the Israeli Supreme Court, as made by way of settlement in which the Company will pay back to Harel the sum of NIS 1,907 (approximately $553) in three monthly equal installments starting February 26, 2020. The consolidated financial statements as of December 31, 2019, include provision in the amount of $553, out of which $482 is presented as 'other income, net' within the net loss from discontinued operations and $71 is presented as 'general and administrative expenses' within the net loss from continuing operations. | |||||
[2] | During the year ended December 31, 2018, the total gain from the Medismart operation divesture, net of transaction costs, amounted to $2,639. This gain together with the expense in the amount of $1,355 that derives from a loss contingency, as mentioned in Note 9E(1), are included in 'other income, net' within the net income from discontinued operations. |
Discontinued Operations (Deta_2
Discontinued Operations (Details Textual) ₪ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jan. 26, 2020USD ($) | Jan. 26, 2020ILS (₪) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Discontinued operations (Textual) | |||||
Other income, net | $ 482 | $ 1,346 | |||
Damages occured | $ 1,600 | ||||
Provision amount | 553 | $ 1,370 | |||
General and administrative expenses | $ 71 | ||||
Net of transaction cost | 2,639 | ||||
Contingency loss | $ 1,355 | ||||
Subsequent Event [Member] | |||||
Discontinued operations (Textual) | |||||
Pay back amount paid | $ 553 | ||||
Subsequent Event [Member] | NIS [Member] | |||||
Discontinued operations (Textual) | |||||
Pay back amount paid | ₪ | ₪ 1,907 |
Operating Segments (Details)
Operating Segments (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 14,751 | $ 21,878 | $ 20,873 | |
Reportable segment gross profit | [1] | 8,084 | 11,998 | 11,175 |
Reconciliation of reportable segment gross profit to gross profit for the period | ||||
Depreciation | (783) | (826) | (757) | |
Stock-based compensation | (5) | (4) | (1) | |
Gross profit for the period in the consolidated financial statement | 7,296 | 11,168 | 10,417 | |
Retail and Mass Transit Ticketing [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 11,509 | 16,627 | 15,755 | |
Reportable segment gross profit | [1] | 6,583 | 9,441 | 8,623 |
Petroleum [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 3,242 | 5,251 | 5,118 | |
Reportable segment gross profit | [1] | $ 1,501 | $ 2,557 | $ 2,552 |
[1] | Gross profit as reviewed by the CODM represents gross profit, adjusted to exclude depreciation and stock-based compensation. |
Operating Segments (Details Tex
Operating Segments (Details Textual) | 12 Months Ended |
Dec. 31, 2019Segments | |
Operating Segments (Textual) | |
Number of reportable segments | 2 |
Geographic Information and Ma_3
Geographic Information and Major Customers (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Total export | $ 14,751 | $ 21,878 | $ 20,697 |
Domestic (Israel) | 176 | ||
Revenues by geographical areas from external customers | 14,751 | 21,878 | 20,873 |
Americas [Member] | |||
Total export | 3,625 | 7,914 | 7,167 |
Asia [Member] | |||
Total export | 1,074 | 3,122 | 3,421 |
Africa [Member] | |||
Total export | 2,087 | 2,447 | 2,814 |
Europe [Member] | |||
Total export | $ 7,965 | $ 8,395 | $ 7,295 |
Geographic Information and Ma_4
Geographic Information and Major Customers (Details 1) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Long lived assets by geographical areas | $ 6,353 | $ 5,274 |
Domestic (Israel) [Member] | ||
Long lived assets by geographical areas | 1,846 | 686 |
South Africa [Member] | ||
Long lived assets by geographical areas | 3,992 | 3,704 |
Poland [Member] | ||
Long lived assets by geographical areas | 496 | 884 |
America [Member] | ||
Long lived assets by geographical areas | $ 19 |
Geographic Information and Ma_5
Geographic Information and Major Customers (Details 2) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Customer A [Member] | |||
Major Customers by percentage from total revenues | 21.00% | 15.00% | 16.00% |
Customer B [Member] | |||
Major Customers by percentage from total revenues | 0.00% | 9.00% | 12.00% |
Customer C [Member] | |||
Major Customers by percentage from total revenues | 4.00% | 11.00% | 11.00% |
Customer D [Member] | |||
Major Customers by percentage from total revenues | 15.00% | 7.00% | 4.00% |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Leases [Abstract] | ||
2019 | $ 523 | |
2020 | $ 821 | |
2021 | 689 | 350 |
2022 | 496 | 277 |
2023 | 191 | 163 |
2023 | 118 | 140 |
Thereafter | 29 | 156 |
Total leases payments | 2,344 | $ 1,609 |
Less - discount | 175 | |
Operating lease liabilities | $ 2,169 |
Leases (Details Textual)
Leases (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Jan. 02, 2019 | Dec. 31, 2018 | |
Leases (Textual) | |||
Right-of-use assets due to operating leases | $ 2,134 | $ 1,572 | |
Right-of-use liabilities due to operating leases | $ 2,169 | $ 1,572 | |
Weighted average discount rate | 5.30% | ||
Operating lease, cost | $ 900 | ||
Leases period | The remaining operating lease periods of the leases range from less than one year to six years | ||
Leases, description | The Company expects an increase of approximately $1,800 in the right-of-use assets and in the lease liabilities on the first-time-recognition of this lease. | ||
Operating lease, term | 1 year 8 months 12 days | ||
Long-term liabilities due to operating leases, net of current maturities | $ 1,483 | ||
Short-term liabilities due to operating leases and current maturities | $ 686 |
Subsequent events (Details)
Subsequent events (Details) - USD ($) $ in Thousands | Jan. 31, 2020 | Dec. 31, 2019 |
Subsequent Events (Textual) | ||
Ordinary Shares issued | 5,460,000 | |
Subsequent Event [Member] | ||
Subsequent Events (Textual) | ||
Ordinary Shares issued | 1,040,000 | |
Gross Proceeds | $ 208 |