Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2019 | May 05, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NATURAL GAS SERVICES GROUP INC | |
Entity Central Index Key | 0001084991 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 13,225,077 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current Assets: | ||
Cash and cash equivalents | $ 39,992 | $ 52,628 |
Trade accounts receivable, net of allowance for doubtful accounts of $299 and $291, respectively | 10,298 | 7,219 |
Inventory | 35,499 | 30,974 |
Prepaid income taxes | 3,100 | 3,148 |
Prepaid expenses and other | 1,702 | 2,430 |
Total current assets | 90,591 | 96,399 |
Long-term inventory, net of allowance for obsolescence of $19 | 3,997 | 3,980 |
Rental equipment, net of accumulated depreciation of $168,466 and $165,428, respectively | 179,442 | 175,886 |
Property and equipment, net of accumulated depreciation of $11,665 and $11,556, respectively | 17,134 | 16,587 |
Right of use assets - operating leases, net of accumulated amortization $36 | 541 | 0 |
Goodwill | 10,039 | 10,039 |
Intangibles, net of accumulated amortization of $1,789 and $1,758, respectively | 1,370 | 1,401 |
Other assets | 1,243 | 1,109 |
Total assets | 304,357 | 305,401 |
Current Liabilities: | ||
Accounts payable | 3,450 | 2,122 |
Accrued liabilities | 4,341 | 8,743 |
Current operating leases | 148 | 0 |
Deferred income | 133 | 81 |
Total current liabilities | 8,072 | 10,946 |
Line of credit | 417 | 417 |
Deferred income tax liability | 32,315 | 32,158 |
Long-term operating leases | 393 | 0 |
Other long-term liabilities | 1,764 | 1,699 |
Total liabilities | 42,961 | 45,220 |
Commitments and contingencies (Note 9) | ||
Stockholders’ Equity: | ||
Preferred stock, 5,000 shares authorized, no shares issued or outstanding | 0 | 0 |
Common stock, 30,000 shares authorized, par value $0.01; 13,133 and 13,005 shares issued and outstanding, respectively | 131 | 130 |
Additional paid-in capital | 108,617 | 107,760 |
Retained earnings | 152,648 | 152,291 |
Total stockholders' equity | 261,396 | 260,181 |
Total liabilities and stockholders' equity | $ 304,357 | $ 305,401 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2019 | Dec. 31, 2018 |
Current Assets: | ||
Allowance for doubtful accounts | $ 299 | $ 291 |
Allowance for inventory obsolescence | 19 | 19 |
Noncurrent Assets: | ||
Accumulated depreciation, rental equipment | 168,466 | 165,428 |
Accumulated depreciation, property and equipment | 11,665 | 11,556 |
Accumulated amortization, operating lease right of use assets | 36 | |
Accumulated amortization, intangibles | $ 1,789 | $ 1,758 |
Stockholders’ Equity: | ||
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 13,133,000 | 13,005,000 |
Common stock, shares outstanding (in shares) | 13,133,000 | 13,005,000 |
Condensed Consolidated Income S
Condensed Consolidated Income Statements - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Revenue: | ||
Revenue | $ 17,991 | $ 14,718 |
Operating costs and expenses: | ||
Cost of rentals, exclusive of depreciation stated separately below | 5,885 | 4,704 |
Cost of sales, exclusive of depreciation stated separately below | 3,699 | 2,191 |
Cost of service and maintenance | 147 | 65 |
Selling, general and administrative expense | 2,493 | 2,021 |
Depreciation and amortization | 5,558 | 5,387 |
Total operating costs and expenses | 17,782 | 14,368 |
Operating income | 209 | 350 |
Other income (expense): | ||
Interest expense | (4) | (3) |
Other income (expense), net | 305 | (73) |
Total other income (expense), net | 301 | (76) |
Income before provision for income taxes | 510 | 274 |
Income tax expense | 153 | 49 |
Net income | $ 357 | $ 225 |
Earnings per share: | ||
Basic (in USD per share) | $ 0.03 | $ 0.02 |
Diluted (in USD per share) | $ 0.03 | $ 0.02 |
Weighted average shares outstanding: | ||
Basic (in shares) | 13,064 | 12,920 |
Diluted (in shares) | 13,268 | 13,169 |
Rental | ||
Revenue: | ||
Revenue | $ 13,387 | $ 11,471 |
Operating costs and expenses: | ||
Total operating costs and expenses | 5,885 | 4,704 |
Other income (expense): | ||
Total other income (expense), net | 0 | 0 |
Income before provision for income taxes | 7,502 | 6,767 |
Sales | ||
Revenue: | ||
Revenue | 4,125 | 2,998 |
Service and maintenance | ||
Revenue: | ||
Revenue | 479 | 249 |
Operating costs and expenses: | ||
Total operating costs and expenses | 147 | 65 |
Other income (expense): | ||
Total other income (expense), net | 0 | 0 |
Income before provision for income taxes | $ 332 | $ 184 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Retained Earnings |
Preferred stock, shares outstanding, beginning of period (in shares) at Dec. 31, 2017 | 0 | ||||
Common stock, shares outstanding, beginning of period (in shares) at Dec. 31, 2017 | 12,880,000 | ||||
Balance, beginning of period at Dec. 31, 2017 | $ 257,319 | $ 0 | $ 129 | $ 105,325 | $ 151,865 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options, shares (in shares) | 9,000 | ||||
Exercise of common stock options | 157 | 157 | |||
Compensation expense on common stock options | 66 | 66 | |||
Issuance of restricted stock, shares (in shares) | 60,000 | ||||
Issuance of restricted stock | 0 | ||||
Compensation expense on restricted common stock | 362 | 362 | |||
Taxes paid related to net shares settlement of equity awards | (495) | (495) | |||
Net income | 225 | 225 | |||
Preferred stock, shares outstanding, end of period (in shares) at Mar. 31, 2018 | 0 | ||||
Common stock, shares outstanding, end of period (in shares) at Mar. 31, 2018 | 12,949,000 | ||||
Balance, end of period at Mar. 31, 2018 | $ 257,634 | $ 0 | $ 129 | 105,415 | 152,090 |
Preferred stock, shares outstanding, beginning of period (in shares) at Dec. 31, 2018 | 0 | 0 | |||
Common stock, shares outstanding, beginning of period (in shares) at Dec. 31, 2018 | 13,005,000 | 13,005,000 | |||
Balance, beginning of period at Dec. 31, 2018 | $ 260,181 | $ 0 | $ 130 | 107,760 | 152,291 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of common stock options, shares (in shares) | 57,000 | ||||
Exercise of common stock options | 555 | 555 | |||
Compensation expense on common stock options | 31 | 31 | |||
Issuance of restricted stock, shares (in shares) | 71,000 | ||||
Issuance of restricted stock | 0 | ||||
Compensation expense on restricted common stock | 464 | $ 1 | 463 | ||
Taxes paid related to net shares settlement of equity awards | (192) | (192) | |||
Net income | $ 357 | 357 | |||
Preferred stock, shares outstanding, end of period (in shares) at Mar. 31, 2019 | 0 | 0 | |||
Common stock, shares outstanding, end of period (in shares) at Mar. 31, 2019 | 13,133,000 | 13,133,000 | |||
Balance, end of period at Mar. 31, 2019 | $ 261,396 | $ 0 | $ 131 | $ 108,617 | $ 152,648 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 357 | $ 225 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 5,558 | 5,387 |
Deferred income taxes | 157 | 48 |
Stock-based compensation | 495 | 428 |
Bad debt (recovery) allowance | 10 | (50) |
Gain on sale of assets | (22) | 0 |
(Gain) loss on company owned life insurance | (99) | 67 |
Changes in operating assets and liabilities: | ||
Trade accounts receivables | (3,089) | 865 |
Inventory | (4,468) | 15 |
Prepaid expenses and prepaid income taxes | 202 | 488 |
Accounts payable and accrued liabilities | (3,074) | (2,539) |
Deferred income | 52 | 109 |
Other | 75 | 85 |
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES | (3,846) | 5,128 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of rental equipment and property and equipment | (9,130) | (8,712) |
Purchase of company owned life insurance | (40) | (139) |
Proceeds from sale of property and equipment | 11 | 0 |
Proceeds from insurance claims of property and equipment | 11 | 0 |
NET CASH USED IN INVESTING ACTIVITIES | (9,148) | (8,851) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payments from other long-term liabilities, net | (5) | (9) |
Proceeds from exercise of stock options | 555 | 157 |
Taxes paid related to net share settlement of equity awards | (192) | (495) |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 358 | (347) |
NET CHANGE IN CASH AND CASH EQUIVALENTS | (12,636) | (4,070) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 52,628 | 69,208 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 39,992 | 65,138 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Interest paid | 4 | 3 |
Income taxes paid | 2 | 0 |
NON-CASH TRANSACTIONS | ||
Transfer of rental equipment components to inventory | 0 | 40 |
Transfer of prepaids to rental equipment and inventory | 574 | $ 0 |
Right of use acquired through an operating lease | $ 126 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies These notes apply to the unaudited condensed consolidated financial statements of Natural Gas Services Group, Inc. a Colorado corporation (the "Company", “NGSG”, "Natural Gas Services Group", "we" or "our"). The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, its subsidiary, NGSG Properties, LLC and the rabbi trust associated with the Company's deferred compensations plan, see Note 4. All significant intercompany accounts and transactions for the periods presented have been eliminated in consolidation. These financial statements include all adjustments, consisting of only normal recurring adjustments, which are necessary to make our financial position at March 31, 2019 and the results of our operations for the three months ended March 31, 2019 and 2018 not misleading. As permitted by the rules and regulations of the Securities and Exchange Commission (SEC), the accompanying condensed consolidated financial statements do not include all disclosures normally required by generally accepted accounting principles in the United States of America (GAAP). These financial statements should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 on file with the SEC. In our opinion, the condensed consolidated financial statements are a fair presentation of the financial position, results of operations, changes in stockholders' equity and cash flows for the periods presented. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2019. Revenue Recognition Policy The Company adopted ASC 606, Revenue from Contracts with Customers ("ASC 606") on January, 1, 2018. As a result, the Company has changed its accounting policy for revenue recognition as detailed below. The Company applied ASC 606 using the cumulative effect method. We had no significant changes in our recognition of revenue at adoption and our review of all open revenue from contracts with customers on January 1, 2018 indicated we had no adjustment to be made. If an adjustment had been needed, we would have recognized the cumulative effect of initially applying ASC 606 with an adjustment to the opening balance of equity at January 1, 2018. Revenue is measured based on a consideration specified in a customer’s contract, excluding any sale incentives and taxes collected on behalf of third parties (i.e. sales and property taxes). We recognize revenue once a performance obligation has been satisfied and control over a product or service has transferred to the customer. Shipping and handling costs incurred are accounted for as fulfillment costs and are included in cost of revenues in our condensed consolidated income statement. Nature of Goods and Services The following is a description of principal activities from which the Company generates its revenue: Rental Revenue. The Company generates revenue from renting compressors and flare systems to our customers. These contracts may also include a fee for servicing the compressor or flare during the rental contract. Our rental contracts range from six to twenty-four months, with revenue being recognized over time, in equal payments over the term of the contract. After the terms of the contract have expired, a customer may renew their contract or continue renting on a monthly basis thereafter. In accordance ASC 842 – Leases, we have applied the practical expedient ASC 842-10-15-42A, which allows the Company to combine lease and non-lease components. Sales Revenue. The Company generates revenue by the sale of custom/fabricated compressors, flare systems and parts, as well as, exchange/rebuilding customer owned compressors and sale of used rental equipment. Custom/fabricated compressors and flare systems - The Company designs and fabricates compressors and flares based on the customer’s specifications outlined in their contract. Though the equipment being built is customized by the customer, control under these contracts does not pass to the customer until the compressor or flare package is complete and shipped, or in accordance with a bill and hold arrangements the customer accepts title and assumes the risk and rewards of ownership. We request some of our customers to make progressive payments as the product is being built; these payments are recorded as a contract liability on the Deferred Income line on the condensed consolidated balance sheet until control has been transferred. These contracts also may include an assurance warranty clause to guarantee the product is free from defects in material and workmanship for a set duration of time; this is a standard industry practice and is not considered a performance obligation. From time to time, upon the customer’s written request, we recognize revenue when manufacturing is complete and the equipment is ready for shipment. At the customer’s request, we will bill the customer upon completing all performance obligations, but before shipment. The customer will formally request we ship the equipment per their direction from our manufacturing facility at a later specified date and that we segregate the equipment from our finished goods, such that they are not available to fill other orders. Per the customer’s agreement change of control is passed to the customer once the equipment is complete and ready for shipment. We have operated using bill and hold agreements with certain customers for many years, with consistent satisfactory results for both the customer and us. The credit terms on these agreements are consistent with the credit terms on all other sales. All control is shouldered by the customer and there are no exceptions to the customer’s commitment to accept and pay for the manufactured equipment. Revenues recognized related to bill and hold arrangements for the three months ended March 31, 2019 was approximately $2.7 million. Parts - Revenue is recognized after the customer obtains control of the parts. Control is passed either by the customer taking physical possession or the parts being shipped. The amount of revenue recognized is not adjusted for expected returns, as our historical part returns have been de minimis. Exchange or rebuilding customer owned compressors - Based on the contract, the Company will either exchange a new/rebuilt compressor for the customer’s malfunctioning compressor or rebuild the customer’s compressor. Revenue is recognized after control of the replacement compressor has transferred to the customer by physical delivery, delivery and installment or shipment of the compressor. Used compressors or flares - From time to time, a customer may request to purchase a used compressor or flare out of our rental fleet. Revenue from the sale of rental equipment is recognized when the control has passed to the customer, when the customer has taken physical possession or the equipment has been shipped. Service and Maintenance Revenue . The Company provides routine or call-out services on customer owned equipment. Revenue is recognized after services in the contract are rendered. Payment terms for sales revenue and service and maintenance revenue discussed above are generally 30 to 60 days although terms for specific customers can vary. Also, the transaction prices are not subject to variable consideration constraints. Disaggregation of Revenue The following table shows the Company's revenue disaggregated by product or service type for the three months ended March 31, 2019 and 2018: Three months ended March 31, (in thousands) 2019 2018 Compressors - sales $ 2,708 $ 1,829 Flares - sales 435 522 Other (Parts/Rebuilds) - sales 982 647 Service and maintenance 479 249 Total revenue from contracts with customers 4,604 3,247 Add: non-ASC 606 rental revenue 13,387 11,471 Total revenue $ 17,991 $ 14,718 Contract Balances As of March 31, 2019 and December 31, 2018, we had the following receivables and deferred income from contracts with customers: March 31, 2019 December 31, 2018 (in thousands) Accounts Receivable Accounts receivable - contracts with customers $ 3,484 $ 2,250 Accounts receivable - non-ASC 606 7,113 5,260 Total Accounts Receivable $ 10,597 $ 7,510 Less: Allowance for doubtful accounts $ (299) $ (291) Total Accounts Receivable, net $ 10,298 $ 7,219 Deferred income $ 133 $ 81 The Company recognized $15,000 in revenue for the period ended March 31, 2019 that was included in deferred income at the beginning of 2019. For the period ended December 31, 2018, the Company recognized revenue of $176,000 from amounts related to sales that were included in deferred income at the beginning of 2018. The changes in the balance of accounts receivable and deferred income were primarily due to normal timing differences between our performance and the customers’ payments. Transaction Price Allocated to the Remaining Performance Obligations As of March 31, 2019, the Company did not have revenue related to performance obligations under ASC 606-10-50-13. Contract Costs The Company applies the practical expedient in ASC 340-40-25-4 and recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in selling, general and administrative expense on our consolidated income statement. Leases On January 1, 2019, we adopted ASC 842, Leases ("ASC 842") and all the related amendments using the modified retrospective method. We recognized the cumulative effect of initially applying the new lease standard and had no adjustments to retained earnings. The comparative information has not been restated and continues to be reported under the lease accounting standard in effect for those periods. We do not expect the adoption of the new lease standard to have a material impact to our net income on an ongoing basis. The new lease standard requires all leases to be reported on the balance sheet as right-of-use assets and lease obligations. We elected the practical expedients permitted under the transition guidance of the new standard that retained the lease classification and initial direct costs for any leases that existed prior to adoption of the standard. We did not reassess whether any contracts or land easements entered into prior to adoption are leases or contain leases. The cumulative effect of the changes made to our consolidated balance sheet at January 1, 2019, for the adoption of ASU 2016-02, Leases, was as follows (in thousands): Balance at December 31, 2018 Adjustments due to ASU 2016-02 Balance at January 1, 2019 Balance Sheet Assets Right of use assets — 451 451 Liabilities Current portion of operating leases — 126 126 Long term portion of operating leases — 325 325 The Company, as a lessee, applies the practical expedient in ASC 842-10-15-37, and does not separate non-lease components from lease components, therefore, accounting for each separate lease component and its associated non-lease component, as a single lease component. The Company, as a lessor, applies the practical expedient in ASC 842-10-15-42A, in leases that contain the same timing and pattern of transfer for lease and non-lease components and are deemed operating leases, the lessor is not required to separate non-lease components from lease components. Therefore, on any lease that meets these qualifications we have chosen to account for each separate lease component and its associated non-lease component, as a single lease component. The Company applies the practical expedient in ASC 842-20-25-2, to recognize the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred for leases with terms of 12 months or less. Fair Value of Financial Instruments Our financial instruments consist principally of cash and cash equivalents, accounts receivable, accounts payable, deferred compensation plan (cash portion) and our line of credit. Pursuant to ASC 820 (Accounting Standards Codification), the fair value of our cash equivalents is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their fair values because of their nature (variable rate debt) and relatively short maturity dates or durations. Income Taxes As part of the process of preparing our financial statements, we are required to estimate our federal income taxes as well as income taxes in each of the states in which we operate. This process involves us estimating our actual current tax exposure together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheet. We must then assess the likelihood that our deferred tax assets will be recovered from future taxable income and, to the extent we believe that recovery is not probable, we must establish a valuation allowance. To the extent we establish a valuation allowance or increase this allowance in a period, we must include an expense in the tax provision in the statement of operations. Significant management judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We currently have no valuation allowance and fully expect to utilize all of our deferred tax assets. ASC Topic 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In order to record any financial statement benefit, we are required to determine, based on technical merits of the position, whether it is more likely than not (a likelihood of more than 50 percent) that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes. If that step is satisfied, then we must measure the tax position to determine the amount of benefit to recognize in the financial statements. The tax position is measured at the largest amount of the benefit that has a greater than 50 percent likely of being realized upon ultimate settlement. Our policy regarding income tax interest and penalties is to expense those items as other expense. During the fourth quarter of 2018, the Company discovered a potential uncertain tax position attributable to the deductibility of certain executive compensation expense for federal income tax purposes aggregating approximately $168,000, $149,000 and $230,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As a result, in accordance with ASC Topic 740, during the fourth quarter of 2018, the Company recorded a tax adjustment of $547,000 and accrued penalty and interest expense of $55,000 attributable to the uncertain tax position. Management of the Company determined that the effect of the potential uncertain tax position on previously reported results of operations for the years ended December 31, 2017 and 2016 was not material. The Company plans on amending its previously filed federal income tax returns and is in the process of analyzing certain offsetting deductions to reduce uncertain tax position reserve. Reclassification of Prior Period Balances Certain reclassifications have been made to prior period amounts, due to our adoption of ASC 842, to conform to the current-year presentation. These reclassifications had no effect on the financial statements. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock Options: A summary of option activity under our 1998 Stock Option Plan as of December 31, 2018, and changes during the three months ended March 31, 2019 is presented below. Number of Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value (in thousands) Outstanding, December 31, 2018 283,686 $ 20.46 3.58 $ 434 Exercised (56,352) 8.97 — 474 Canceled/Forfeited (2,000) 26.66 — — Outstanding, March 31, 2019 225,334 $ 23.28 4.18 $ 26 Exercisable, March 31, 2019 214,901 $ 23.04 4.00 $ 26 The following table summarizes information about our stock options outstanding at March 31, 2019: Range of Exercise Prices Options Outstanding Options Exercisable Shares Weighted Average Remaining Contractual Life (years) Weighted Average Exercise Price Shares Weighted Average Exercise Price $0.01-15.70 8,500 2.82 $ 14.89 8,500 $ 14.89 $15.71-17.81 42,000 1.32 17.54 42,000 17.54 $17.82-20.48 50,500 2.09 19.43 50,500 19.43 $20.49-33.36 124,334 6.08 27.36 113,901 27.29 225,334 4.18 $ 23.28 214,901 $ 23.04 The summary of the status of our unvested stock options as of December 31, 2018 and changes during the three months ended March 31, 2019 is presented below. Unvested stock options: Shares Weighted Average Grant Date Fair Value Per Share Unvested at December 31, 2018 20,865 $ 11.93 Vested (10,432) 11.93 Unvested at March 31, 2019 10,433 $ 11.93 As of March 31, 2019, there was $103,018 of unrecognized compensation cost related to unvested options. Such cost is expected to be recognized over a weighted-average period of one year. Total compensation expense for stock options was $30,779 and $66,625 for the three months ended March 31, 2019 and 2018, respectively. Restricted Shares/Units: In accordance with the Company's employment agreement with Stephen Taylor, the Company's Chief Executive Officer, the Compensation Committee reviewed his performance in determining the issuance of restricted common stock. Based on this review which included consideration of the Company's 2018 performance, Mr. Taylor, was awarded 131,674 restricted shares/units on March 29, 2019, which vest over three years, in equal annual installments, beginning March 29, 2020. On March 29, 2019, the Compensation Committee awarded 20,000 restricted shares/units to each of G. Larry Lawrence, our CFO, and James Hazlett, our Vice President of Technical Services. The restricted shares to Messrs. Lawrence and Hazlett vest over three years, in equal annual installments, beginning March 29, 2020. The restricted common stock awarded to Messrs. Taylor, Lawrence and Hazlett are contingent of the Company's shareholders approval and adoption of the Natural Gas Services Group, Inc. 2019 Equity Incentive Plan at the Annual Shareholder meeting on June 20, 2019. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory Our inventory, net of allowance for obsolescence of $19,000 at March 31, 2019 and December 31, 2018, respectively, consisted of the following amounts: March 31, 2019 December 31, 2018 (in thousands) Raw materials - current $ 29,821 $ 26,152 Raw materials - long term, net 3,997 3,980 Finished Goods 1,022 1,022 Work in process 4,656 3,800 $ 39,496 $ 34,954 Our long-term inventory consists of raw materials that remain viable but that the Company does not expect to sell or use within the year. During the three months ended March 31, 2019 and 2018, there were no write-offs of obsolete inventory against the allowance for obsolescence. |
Deferred Compensation Plans
Deferred Compensation Plans | 3 Months Ended |
Mar. 31, 2019 | |
Postemployment Benefits [Abstract] | |
Deferred Compensation Plans | Deferred Compensation Plans The Company has a non-qualified deferred compensation plan for executive officers, directors and certain eligible employees. The assets of the deferred compensation plan are held in a rabbi trust and are subject to additional risk of loss in the event of bankruptcy or insolvency of the Company. The plan allows for deferral of up to 90% of a participant’s base salary, bonus, commissions, director fees and restricted stock unit awards. A Company owned life insurance policy held in a rabbi trust is utilized as a source of funding for the plan. The cash surrender value of the life insurance policy is $1.2 million and $966,000 as of March 31, 2019 and 2018, respectively. For the three months ending March 31, 2019, we reported in other income (expense) in the consolidated income statement a gain related to the policy of approximately $99,000 and for the same period in 2018, a loss of approximately $67,000. For deferrals of base salary, bonus, commissions and director fees, settlement payments are made to participants in cash, either in a lump sum or in periodic installments. The obligation to pay the deferred compensation and the deferred director fees is adjusted to reflect the positive or negative performance of investment measurement options selected by each participant and was $1.2 million and $992,000 as of March 31, 2019 and 2018, respectively. The deferred obligation is included in other long-term liabilities in the condensed consolidated balance sheet. For deferrals of restricted stock units, the plan does not allow for diversification, therefore, distributions are paid in shares of common stock and the obligation is carried at grant value. As of March 31, 2019 and 2018, respectively, 63,062 and 104,590 unvested restricted stock units have been deferred of which 78,771 and 32,037 units have been released and issued to the deferred compensation plan with a value of $1.7 million and $816,373, respectively. |
Credit Facility
Credit Facility | 3 Months Ended |
Mar. 31, 2019 | |
Debt Disclosure [Abstract] | |
Credit Facility | Credit Facility We have a senior secured revolving credit agreement the ("Amended Credit Agreement") with JP Morgan Chase Bank, N.A (the "Lender") with an aggregate commitment of $30 million, subject to collateral availability. We also have a right to request from the Lender, on an uncommitted basis, an increase of up to $20 million on the aggregate commitment (which could potentially increase the commitment amount to $50 million). On August 31, 2017, we amended and renewed the Amended Credit Agreement, extending the maturity date to December 31, 2020. No other material revisions were made to the credit facility. Borrowing Base . At any time before the maturity of the Amended Credit Agreement, we may draw, repay and re-borrow amounts available under the borrowing base up to the maximum aggregate availability discussed above. Generally, the borrowing base equals the sum of (a) 80% of our eligible accounts receivable plus (b) 50% of the book value of our eligible general inventory (not to exceed 50% of the commitment amount at the time) plus (c) 75% of the book value of our eligible equipment inventory. The Lender may adjust the borrowing base components if material deviations in the collateral are discovered in future audits of the collateral. We had $29.5 million borrowing base availability at March 31, 2019 under the terms of our Amended Credit Agreement. Interest and Fees . Under the terms of the Amended Credit Agreement, we have the option of selecting the applicable variable rate for each revolving loan, or portion thereof, of either (a) LIBOR multiplied by the Statutory Reserve Rate (as defined in the Amended Credit Agreement), with respect to this rate, for Eurocurrency funding, plus the Applicable Margin (“LIBOR-based”), or (b) CB Floating Rate, which is the Lender's Prime Rate less the Applicable Margin; provided, however, that no more than three LIBOR-based borrowings under the agreement may be outstanding at any one time. For purposes of the LIBOR-based interest rate, the Applicable Margin is 1.50%. For purposes of the CB Floating Rate, the Applicable Margin is 1.50%. For the three month period ended March 31, 2019, our weighted average interest rate was 3.75%. Accrued interest is payable monthly on outstanding principal amounts, provided that accrued interest on LIBOR-based loans is payable at the end of each interest period, but in no event less frequently than quarterly. In addition, fees and expenses are payable in connection with our requests for letters of credit (generally equal to the Applicable Margin for LIBOR-related borrowings multiplied by the face amount of the requested letter of credit) and administrative and legal costs. Maturity . The maturity date of the Amended Credit Agreement is December 31, 2020, at which time all amounts borrowed under the agreement will be due and outstanding letters of credit must be cash collateralized. The agreement may be terminated early upon our request or the occurrence of an event of default. Security . The obligations under the Amended Credit Agreement are secured by a first priority lien on all of our inventory and accounts and leases receivables, along with a first priority lien on a variable number of our leased compressor equipment the book value of which must be maintained at a minimum of 2.00 to 1.00 commitment coverage ratio (such ratio being equal to (i) the amount of the borrowing base as of such date to (ii) the amount of the commitment as of such date). Covenants. The Amended Credit Agreement contains customary representations and warranties, as well as covenants which, among other things, limit our ability to incur additional indebtedness and liens; enter into transactions with affiliates; make acquisitions in excess of certain amounts; pay dividends; redeem or repurchase capital stock or senior notes; make investments or loans; make negative pledges; consolidate, merge or effect asset sales; or change the nature of our business. In addition, we also have certain financial covenants that require us to maintain on a consolidated basis a leverage ratio less than or equal to 2.50 to 1.00 as of the last day of each fiscal quarter. Events of Default and Acceleration. The Amended Credit Agreement contains customary events of default for credit facilities of this size and type, and includes, without limitation, payment defaults; defaults in performance of covenants or other agreements contained in the loan documents; inaccuracies in representations and warranties; certain defaults, termination events or similar events; certain defaults with respect to any other Company indebtedness in excess of $50,000; certain bankruptcy or insolvency events; the rendering of certain judgments in excess of $150,000; certain ERISA events; certain change in control events and the defectiveness of any liens under the secured revolving credit facility. Obligations under the Amended Credit Agreement may be accelerated upon the occurrence of an event of default. As of March 31, 2019, we were in compliance with all covenants in our Amended Credit Agreement. A default under our Credit Agreement could trigger the acceleration of our bank debt so that it is immediately due and payable. Such default would likely limit our ability to access other credit. At March 31, 2019 and December 31, 2018, our outstanding balance on the line of credit was $417,000. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases The Company adopted the new lease standard on January 1, 2019 using the modified retrospective transition method. Prior periods were not retrospectively adjusted and continue to be reported under the accounting standards in effect for those periods. The Company elected the package of practical expedients permitted under the transition guidance within the new lease standard, which among other things, allowed the company to continue to account for existing leases based on the historical lease classification. The Company also elected the practical expedients to exclude right-of-use ("ROU") assets and lease liabilities for leases with an initial term of 12 months or less from the balance sheet, and to combine lease and non-lease components for property leases, which primarily relate to ancillary expenses such as common area maintenance charges and management fees. The Company determines if an arrangement is a lease at inception by assessing whether it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company’s leases are primarily related to property leases for its field offices. The Company's leases have remaining lease terms of one to 10 years. Renewal and termination options are included in the lease term when it is reasonably certain that the Company will exercise the option. The Company's lease agreements do not contain any contingent rental payments, material residual guarantees or material restrictive covenants. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As substantially all of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate to determine the present value of lease payments. Based on the present value of lease payments for the Company's existing leases, the Company recorded net lease assets and lease liabilities of approximately $451,000, respectively, upon adoption. The Company had no finance leases. The new lease standard did not materially impact the Company's consolidated statements of operations and had no impact on the Company's consolidated statements of cash flows. The impact of the new lease standard on the March 31, 2019 consolidated balance sheet was as follows: Classification on the Condensed Consolidated Balance Sheet March 31, 2019 (in thousands, except years) Operating lease assets Right of use assets-operating leases $ 541 Current lease liabilities Current operating leases 148 Noncurrent lease liabilities Long-term operating leases 393 Total lease liabilities, net 541 Weighted average remaining lease term in years 3.1 Implicit Rate 3.8 % Operating lease costs are recognized on a straight-line basis over the lease term. Total operating lease costs for the three months ended March 31, 2019 was approximately $193,000, which included approximately $146,000 related to short-term lease costs. March 31, 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities Operating lease cost (1) $ 48 (1) Lease costs are classified on the condensed consolidated statements of income in cost of sales, cost of compressors and selling, general and administrative expenses. The following table shows the future maturities of lease liabilities: Years Ending December 31, Lease Liabilities (in thousands) 2019 (excluding the three months ended March 31, 2019) $ 134 2020 $ 116 2021 $ 95 2022 $ 43 2023 $ 35 Thereafter $ 190 Total lease payments $ 613 Less: Imputed interest $ 72 Total $ 541 As previously disclosed on Form 10-K and under the previous lease standard (Topic 840), future minimum obligations under lease commitments in effect at December 31, 2018 as follows: Operating Leases (in thousands) 2019 298 2020 118 2021 97 2022 44 2023 35 Thereafter 15 Total 607 |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share The following table reconciles the numerators and denominators of the basic and diluted earnings per share computation (in thousands, except per share data) : Three months ended March 31, 2019 2018 Numerator: Net income $ 357 $ 225 Denominator for basic net income per common share: Weighted average common shares outstanding 13,064 12,920 Denominator for diluted net income per share: Weighted average common shares outstanding 13,064 12,920 Dilutive effect of stock options and restricted stock 204 249 Diluted weighted average shares 13,268 13,169 Earnings per common share: Basic $ 0.03 $ 0.02 Diluted $ 0.03 $ 0.02 In the three months ended March 31, 2019, options to purchase 174,834 shares of common stock with exercise prices ranging from $18.75 to $33.36 were not included in the computation of diluted income per share, due to their antidilutive effect. In the three months ended March 31, 2018, options to purchase 83,917 shares of common stock with exercise prices ranging from $28.15 to $33.36 were not included in the computation of diluted income per share, due to their antidilutive effect. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information ASC 280-10-50, “Operating Segments", defines the characteristics of an operating segment as: a) being engaged in business activity from which it may earn revenue and incur expenses, b) being reviewed by the Company's chief operating decision maker (CODM) for decisions about resources to be allocated and assess its performance and c) having discrete financial information. Although we look at our products to analyze the nature of our revenue, other financial information, such as certain costs and expenses, net income and EBITDA are not captured or analyzed by these categories. Our CODM does not make resource allocation decisions or access the performance of the business based on these categories, but rather in the aggregate. Based on this, management believes that it operates in one business segment. In their analysis of product lines as potential operating segments, management also considered ASC 280-10-50-11, “Aggregation Criteria”, which allows for the aggregation of operating segments if the segments have similar economic characteristics and if the segments are similar in each of the following areas: • The nature of the products and services; • The nature of the production processes; • The type or class of customer for their products and services; • The methods used to distribute their products or provide their services; and • The nature of the regulatory environment, if applicable. We are engaged in the business of designing and manufacturing compressors and flares. Our compressors and flares are sold and rented to our customers. In addition, we provide service and maintenance on compressors in our fleet and to third parties. These business activities are similar in all geographic areas. Our manufacturing process is essentially the same for the entire Company and is performed in-house at our facilities in Midland, Texas and Tulsa, Oklahoma. Our customers primarily consist of entities in the business of producing natural gas and crude oil. The maintenance and service of our products is consistent across the entire Company and is performed via an internal fleet of vehicles. The regulatory environment is similar in every jurisdiction in that the most impacting regulations and practices are the result of federal energy policy. In addition, the economic characteristics of each customer arrangement are similar in that we maintain policies at the corporate level. For the three months ended March 31, 2019 (in thousands): Rental Sales Service & Maintenance Corporate Total Revenue $ 13,387 $ 4,125 $ 479 $ — $ 17,991 Operating costs and corporate expenses 5,885 3,699 147 8,051 17,782 Total other income, net — — — 301 301 Income before provision for income taxes $ 7,502 $ 426 $ 332 $ (7,750) $ 510 For the three months ended March 31, 2018 (in thousands): Rental Sales Service & Maintenance Corporate Total Revenue $ 11,471 $ 2,998 $ 249 $ — $ 14,718 Operating costs and corporate expenses 4,704 2,191 65 7,408 14,368 Total other expense, net — — — (76) (76) Income before provision for income taxes $ 6,767 $ 807 $ 184 $ (7,484) $ 274 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesFrom time to time, we are a party to various legal proceedings in the ordinary course of our business. While management is unable to predict the ultimate outcome of these actions, it believes that any ultimate liability arising from these actions will not have a material adverse effect on our financial position, results of operations or cash flow. We are not currently a party to any material legal proceedings, and we are not aware of any threatened material litigation. The Company also has a remaining contractual obligation related to the construction of a new corporate office of approximately $3.7 million, to be financed by cash on hand. Construction of a new office began in late 2017 and is expected to be completed in mid-2019. |
Related Party
Related Party | 3 Months Ended |
Mar. 31, 2019 | |
Related Party Transactions [Abstract] | |
Related Party | Related Party In 2016, we entered into a joint venture partnership, N-G, LLC (‘N-G”), with Genis Holdings, LLC (“Genis”) to explore new technologies for wellhead compression. NGS and Genis both share 50% ownership of N-G. In 2018, we ordered some compressor packages from Genis, totaling $1.0 million. The compressors were completed by March 31, 2019. As of March 31, 2019, we have paid the units in full which has been reclassified from prepaids and is included in rental equipment on the consolidated balance sheet. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Accounting | These notes apply to the unaudited condensed consolidated financial statements of Natural Gas Services Group, Inc. a Colorado corporation (the "Company", “NGSG”, "Natural Gas Services Group", "we" or "our"). The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, its subsidiary, NGSG Properties, LLC and the rabbi trust associated with the Company's deferred compensations plan, see Note 4. All significant intercompany accounts and transactions for the periods presented have been eliminated in consolidation. These financial statements include all adjustments, consisting of only normal recurring adjustments, which are necessary to make our financial position at March 31, 2019 and the results of our operations for the three months ended March 31, 2019 and 2018 not misleading. As permitted by the rules and regulations of the Securities and Exchange Commission (SEC), the accompanying condensed consolidated financial statements do not include all disclosures normally required by generally accepted accounting principles in the United States of America (GAAP). These financial statements should be read in conjunction with the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018 on file with the SEC. In our opinion, the condensed consolidated financial statements are a fair presentation of the financial position, results of operations, changes in stockholders' equity and cash flows for the periods presented. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results of operations to be expected for the full fiscal year ending December 31, 2019. |
Revenue Recognition | Revenue Recognition Policy The Company adopted ASC 606, Revenue from Contracts with Customers ("ASC 606") on January, 1, 2018. As a result, the Company has changed its accounting policy for revenue recognition as detailed below. The Company applied ASC 606 using the cumulative effect method. We had no significant changes in our recognition of revenue at adoption and our review of all open revenue from contracts with customers on January 1, 2018 indicated we had no adjustment to be made. If an adjustment had been needed, we would have recognized the cumulative effect of initially applying ASC 606 with an adjustment to the opening balance of equity at January 1, 2018. Revenue is measured based on a consideration specified in a customer’s contract, excluding any sale incentives and taxes collected on behalf of third parties (i.e. sales and property taxes). We recognize revenue once a performance obligation has been satisfied and control over a product or service has transferred to the customer. Shipping and handling costs incurred are accounted for as fulfillment costs and are included in cost of revenues in our condensed consolidated income statement. Nature of Goods and Services The following is a description of principal activities from which the Company generates its revenue: Rental Revenue. The Company generates revenue from renting compressors and flare systems to our customers. These contracts may also include a fee for servicing the compressor or flare during the rental contract. Our rental contracts range from six to twenty-four months, with revenue being recognized over time, in equal payments over the term of the contract. After the terms of the contract have expired, a customer may renew their contract or continue renting on a monthly basis thereafter. In accordance ASC 842 – Leases, we have applied the practical expedient ASC 842-10-15-42A, which allows the Company to combine lease and non-lease components. Sales Revenue. The Company generates revenue by the sale of custom/fabricated compressors, flare systems and parts, as well as, exchange/rebuilding customer owned compressors and sale of used rental equipment. Custom/fabricated compressors and flare systems - The Company designs and fabricates compressors and flares based on the customer’s specifications outlined in their contract. Though the equipment being built is customized by the customer, control under these contracts does not pass to the customer until the compressor or flare package is complete and shipped, or in accordance with a bill and hold arrangements the customer accepts title and assumes the risk and rewards of ownership. We request some of our customers to make progressive payments as the product is being built; these payments are recorded as a contract liability on the Deferred Income line on the condensed consolidated balance sheet until control has been transferred. These contracts also may include an assurance warranty clause to guarantee the product is free from defects in material and workmanship for a set duration of time; this is a standard industry practice and is not considered a performance obligation. From time to time, upon the customer’s written request, we recognize revenue when manufacturing is complete and the equipment is ready for shipment. At the customer’s request, we will bill the customer upon completing all performance obligations, but before shipment. The customer will formally request we ship the equipment per their direction from our manufacturing facility at a later specified date and that we segregate the equipment from our finished goods, such that they are not available to fill other orders. Per the customer’s agreement change of control is passed to the customer once the equipment is complete and ready for shipment. We have operated using bill and hold agreements with certain customers for many years, with consistent satisfactory results for both the customer and us. The credit terms on these agreements are consistent with the credit terms on all other sales. All control is shouldered by the customer and there are no exceptions to the customer’s commitment to accept and pay for the manufactured equipment. Revenues recognized related to bill and hold arrangements for the three months ended March 31, 2019 was approximately $2.7 million. Parts - Revenue is recognized after the customer obtains control of the parts. Control is passed either by the customer taking physical possession or the parts being shipped. The amount of revenue recognized is not adjusted for expected returns, as our historical part returns have been de minimis. Exchange or rebuilding customer owned compressors - Based on the contract, the Company will either exchange a new/rebuilt compressor for the customer’s malfunctioning compressor or rebuild the customer’s compressor. Revenue is recognized after control of the replacement compressor has transferred to the customer by physical delivery, delivery and installment or shipment of the compressor. Used compressors or flares - From time to time, a customer may request to purchase a used compressor or flare out of our rental fleet. Revenue from the sale of rental equipment is recognized when the control has passed to the customer, when the customer has taken physical possession or the equipment has been shipped. Service and Maintenance Revenue . The Company provides routine or call-out services on customer owned equipment. Revenue is recognized after services in the contract are rendered. Payment terms for sales revenue and service and maintenance revenue discussed above are generally 30 to 60 days although terms for specific customers can vary. Also, the transaction prices are not subject to variable consideration constraints. |
Contract Costs | Contract Costs |
Leases | Leases On January 1, 2019, we adopted ASC 842, Leases ("ASC 842") and all the related amendments using the modified retrospective method. We recognized the cumulative effect of initially applying the new lease standard and had no adjustments to retained earnings. The comparative information has not been restated and continues to be reported under the lease accounting standard in effect for those periods. We do not expect the adoption of the new lease standard to have a material impact to our net income on an ongoing basis. The new lease standard requires all leases to be reported on the balance sheet as right-of-use assets and lease obligations. We elected the practical expedients permitted under the transition guidance of the new standard that retained the lease classification and initial direct costs for any leases that existed prior to adoption of the standard. We did not reassess whether any contracts or land easements entered into prior to adoption are leases or contain leases. The cumulative effect of the changes made to our consolidated balance sheet at January 1, 2019, for the adoption of ASU 2016-02, Leases, was as follows (in thousands): Balance at December 31, 2018 Adjustments due to ASU 2016-02 Balance at January 1, 2019 Balance Sheet Assets Right of use assets — 451 451 Liabilities Current portion of operating leases — 126 126 Long term portion of operating leases — 325 325 The Company, as a lessee, applies the practical expedient in ASC 842-10-15-37, and does not separate non-lease components from lease components, therefore, accounting for each separate lease component and its associated non-lease component, as a single lease component. The Company, as a lessor, applies the practical expedient in ASC 842-10-15-42A, in leases that contain the same timing and pattern of transfer for lease and non-lease components and are deemed operating leases, the lessor is not required to separate non-lease components from lease components. Therefore, on any lease that meets these qualifications we have chosen to account for each separate lease component and its associated non-lease component, as a single lease component. The Company applies the practical expedient in ASC 842-20-25-2, to recognize the lease payments in profit or loss on a straight-line basis over the lease term and variable lease payments in the period in which the obligation for those payments is incurred for leases with terms of 12 months or less. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Our financial instruments consist principally of cash and cash equivalents, accounts receivable, accounts payable, deferred compensation plan (cash portion) and our line of credit. Pursuant to ASC 820 (Accounting Standards Codification), the fair value of our cash equivalents is determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. We believe that the recorded values of all of our other financial instruments approximate their fair values because of their nature (variable rate debt) and relatively short maturity dates or durations. |
Income Taxes | Income Taxes As part of the process of preparing our financial statements, we are required to estimate our federal income taxes as well as income taxes in each of the states in which we operate. This process involves us estimating our actual current tax exposure together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheet. We must then assess the likelihood that our deferred tax assets will be recovered from future taxable income and, to the extent we believe that recovery is not probable, we must establish a valuation allowance. To the extent we establish a valuation allowance or increase this allowance in a period, we must include an expense in the tax provision in the statement of operations. Significant management judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We currently have no valuation allowance and fully expect to utilize all of our deferred tax assets. ASC Topic 740 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In order to record any financial statement benefit, we are required to determine, based on technical merits of the position, whether it is more likely than not (a likelihood of more than 50 percent) that a tax position will be sustained upon examination, including resolution of any related appeals or litigation processes. If that step is satisfied, then we must measure the tax position to determine the amount of benefit to recognize in the financial statements. The tax position is measured at the largest amount of the benefit that has a greater than 50 percent likely of being realized upon ultimate settlement. Our policy regarding income tax interest and penalties is to expense those items as other expense. During the fourth quarter of 2018, the Company discovered a potential uncertain tax position attributable to the deductibility of certain executive compensation expense for federal income tax purposes aggregating approximately $168,000, $149,000 and $230,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As a result, in accordance with ASC Topic 740, during the fourth quarter of 2018, the Company recorded a tax adjustment of $547,000 and accrued penalty and interest expense of $55,000 attributable to the uncertain tax position. Management of the Company determined that the effect of the potential uncertain tax position on previously reported results of operations for the years ended December 31, 2017 and 2016 was not material. The Company plans on amending its previously filed federal income tax returns and is in the process of analyzing certain offsetting deductions to reduce uncertain tax position reserve. |
Reclassification of Prior Period Balances | Reclassification of Prior Period Balances Certain reclassifications have been made to prior period amounts, due to our adoption of ASC 842, to conform to the current-year presentation. These reclassifications had no effect on the financial statements. |
Segment Information | ASC 280-10-50, “Operating Segments", defines the characteristics of an operating segment as: a) being engaged in business activity from which it may earn revenue and incur expenses, b) being reviewed by the Company's chief operating decision maker (CODM) for decisions about resources to be allocated and assess its performance and c) having discrete financial information. Although we look at our products to analyze the nature of our revenue, other financial information, such as certain costs and expenses, net income and EBITDA are not captured or analyzed by these categories. Our CODM does not make resource allocation decisions or access the performance of the business based on these categories, but rather in the aggregate. Based on this, management believes that it operates in one business segment. In their analysis of product lines as potential operating segments, management also considered ASC 280-10-50-11, “Aggregation Criteria”, which allows for the aggregation of operating segments if the segments have similar economic characteristics and if the segments are similar in each of the following areas: • The nature of the products and services; • The nature of the production processes; • The type or class of customer for their products and services; • The methods used to distribute their products or provide their services; and • The nature of the regulatory environment, if applicable. We are engaged in the business of designing and manufacturing compressors and flares. Our compressors and flares are sold and rented to our customers. In addition, we provide service and maintenance on compressors in our fleet and to third parties. These business activities are similar in all geographic areas. Our manufacturing process is essentially the same for the entire Company and is performed in-house at our facilities in Midland, Texas and Tulsa, Oklahoma. Our customers primarily consist of entities in the business of producing natural gas and crude oil. The maintenance and service of our products is consistent across the entire Company and is performed via an internal fleet of vehicles. The regulatory environment is similar in every jurisdiction in that the most impacting regulations and practices are the result of federal energy policy. In addition, the economic characteristics of each customer arrangement are similar in that we maintain policies at the corporate level. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table shows the Company's revenue disaggregated by product or service type for the three months ended March 31, 2019 and 2018: Three months ended March 31, (in thousands) 2019 2018 Compressors - sales $ 2,708 $ 1,829 Flares - sales 435 522 Other (Parts/Rebuilds) - sales 982 647 Service and maintenance 479 249 Total revenue from contracts with customers 4,604 3,247 Add: non-ASC 606 rental revenue 13,387 11,471 Total revenue $ 17,991 $ 14,718 |
Schedule of Contract with Customer, Asset and Liability | As of March 31, 2019 and December 31, 2018, we had the following receivables and deferred income from contracts with customers: March 31, 2019 December 31, 2018 (in thousands) Accounts Receivable Accounts receivable - contracts with customers $ 3,484 $ 2,250 Accounts receivable - non-ASC 606 7,113 5,260 Total Accounts Receivable $ 10,597 $ 7,510 Less: Allowance for doubtful accounts $ (299) $ (291) Total Accounts Receivable, net $ 10,298 $ 7,219 Deferred income $ 133 $ 81 |
Cumulative Effect of Changes from Adoption of ASU | The cumulative effect of the changes made to our consolidated balance sheet at January 1, 2019, for the adoption of ASU 2016-02, Leases, was as follows (in thousands): Balance at December 31, 2018 Adjustments due to ASU 2016-02 Balance at January 1, 2019 Balance Sheet Assets Right of use assets — 451 451 Liabilities Current portion of operating leases — 126 126 Long term portion of operating leases — 325 325 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of Option Activity | A summary of option activity under our 1998 Stock Option Plan as of December 31, 2018, and changes during the three months ended March 31, 2019 is presented below. Number of Stock Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life (years) Aggregate Intrinsic Value (in thousands) Outstanding, December 31, 2018 283,686 $ 20.46 3.58 $ 434 Exercised (56,352) 8.97 — 474 Canceled/Forfeited (2,000) 26.66 — — Outstanding, March 31, 2019 225,334 $ 23.28 4.18 $ 26 Exercisable, March 31, 2019 214,901 $ 23.04 4.00 $ 26 |
Summary of Stock Options Outstanding | The following table summarizes information about our stock options outstanding at March 31, 2019: Range of Exercise Prices Options Outstanding Options Exercisable Shares Weighted Average Remaining Contractual Life (years) Weighted Average Exercise Price Shares Weighted Average Exercise Price $0.01-15.70 8,500 2.82 $ 14.89 8,500 $ 14.89 $15.71-17.81 42,000 1.32 17.54 42,000 17.54 $17.82-20.48 50,500 2.09 19.43 50,500 19.43 $20.49-33.36 124,334 6.08 27.36 113,901 27.29 225,334 4.18 $ 23.28 214,901 $ 23.04 |
Status of Unvested Stock Options | The summary of the status of our unvested stock options as of December 31, 2018 and changes during the three months ended March 31, 2019 is presented below. Unvested stock options: Shares Weighted Average Grant Date Fair Value Per Share Unvested at December 31, 2018 20,865 $ 11.93 Vested (10,432) 11.93 Unvested at March 31, 2019 10,433 $ 11.93 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Our inventory, net of allowance for obsolescence of $19,000 at March 31, 2019 and December 31, 2018, respectively, consisted of the following amounts: March 31, 2019 December 31, 2018 (in thousands) Raw materials - current $ 29,821 $ 26,152 Raw materials - long term, net 3,997 3,980 Finished Goods 1,022 1,022 Work in process 4,656 3,800 $ 39,496 $ 34,954 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Leases [Abstract] | |
Schedule of Balance Sheet Impact | The impact of the new lease standard on the March 31, 2019 consolidated balance sheet was as follows: Classification on the Condensed Consolidated Balance Sheet March 31, 2019 (in thousands, except years) Operating lease assets Right of use assets-operating leases $ 541 Current lease liabilities Current operating leases 148 Noncurrent lease liabilities Long-term operating leases 393 Total lease liabilities, net 541 Weighted average remaining lease term in years 3.1 Implicit Rate 3.8 % |
Schedule of Cash Flow Impact | March 31, 2019 (in thousands) Cash paid for amounts included in the measurement of lease liabilities Operating lease cost (1) $ 48 (1) Lease costs are classified on the condensed consolidated statements of income in cost of sales, cost of compressors and selling, general and administrative expenses. |
Schedule of Future Maturities of Lease Liabilities | The following table shows the future maturities of lease liabilities: Years Ending December 31, Lease Liabilities (in thousands) 2019 (excluding the three months ended March 31, 2019) $ 134 2020 $ 116 2021 $ 95 2022 $ 43 2023 $ 35 Thereafter $ 190 Total lease payments $ 613 Less: Imputed interest $ 72 Total $ 541 |
Schedule of Future Minimum Obligations Under Lease Commitments | As previously disclosed on Form 10-K and under the previous lease standard (Topic 840), future minimum obligations under lease commitments in effect at December 31, 2018 as follows: Operating Leases (in thousands) 2019 298 2020 118 2021 97 2022 44 2023 35 Thereafter 15 Total 607 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table reconciles the numerators and denominators of the basic and diluted earnings per share computation (in thousands, except per share data) : Three months ended March 31, 2019 2018 Numerator: Net income $ 357 $ 225 Denominator for basic net income per common share: Weighted average common shares outstanding 13,064 12,920 Denominator for diluted net income per share: Weighted average common shares outstanding 13,064 12,920 Dilutive effect of stock options and restricted stock 204 249 Diluted weighted average shares 13,268 13,169 Earnings per common share: Basic $ 0.03 $ 0.02 Diluted $ 0.03 $ 0.02 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | We are engaged in the business of designing and manufacturing compressors and flares. Our compressors and flares are sold and rented to our customers. In addition, we provide service and maintenance on compressors in our fleet and to third parties. These business activities are similar in all geographic areas. Our manufacturing process is essentially the same for the entire Company and is performed in-house at our facilities in Midland, Texas and Tulsa, Oklahoma. Our customers primarily consist of entities in the business of producing natural gas and crude oil. The maintenance and service of our products is consistent across the entire Company and is performed via an internal fleet of vehicles. The regulatory environment is similar in every jurisdiction in that the most impacting regulations and practices are the result of federal energy policy. In addition, the economic characteristics of each customer arrangement are similar in that we maintain policies at the corporate level. For the three months ended March 31, 2019 (in thousands): Rental Sales Service & Maintenance Corporate Total Revenue $ 13,387 $ 4,125 $ 479 $ — $ 17,991 Operating costs and corporate expenses 5,885 3,699 147 8,051 17,782 Total other income, net — — — 301 301 Income before provision for income taxes $ 7,502 $ 426 $ 332 $ (7,750) $ 510 For the three months ended March 31, 2018 (in thousands): Rental Sales Service & Maintenance Corporate Total Revenue $ 11,471 $ 2,998 $ 249 $ — $ 14,718 Operating costs and corporate expenses 4,704 2,191 65 7,408 14,368 Total other expense, net — — — (76) (76) Income before provision for income taxes $ 6,767 $ 807 $ 184 $ (7,484) $ 274 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | |
Revenue from External Customer [Line Items] | |||
Revenue | $ 17,991 | $ 14,718 | |
Additions to tax positions of prior years | $ 547 | ||
Income tax penalties and interest accrued | 55 | ||
Bill and Hold Arrangement | |||
Revenue from External Customer [Line Items] | |||
Revenue | $ 2,700 | ||
Minimum | |||
Revenue from External Customer [Line Items] | |||
Amortization period of capitalized contract costs | 1 year | ||
Tax Year 2017 | |||
Revenue from External Customer [Line Items] | |||
Additions to tax positions of prior years | 168 | ||
Tax Year 2016 | |||
Revenue from External Customer [Line Items] | |||
Additions to tax positions of prior years | 149 | ||
Tax Year 2015 | |||
Revenue from External Customer [Line Items] | |||
Additions to tax positions of prior years | $ 230 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, excluding assessed tax | $ 4,604 | $ 3,247 |
Add: non-ASC 606 rental revenue | 13,387 | 11,471 |
Revenue | 17,991 | 14,718 |
Compressors - sales | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, excluding assessed tax | 2,708 | 1,829 |
Flares - sales | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, excluding assessed tax | 435 | 522 |
Other (Parts/Rebuilds) - sales | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, excluding assessed tax | 982 | 647 |
Service and maintenance | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, excluding assessed tax | 479 | 249 |
Revenue | $ 479 | $ 249 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies (Contract Balances) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Accounts Receivable | ||
Accounts receivable - contracts with customers | $ 3,484 | $ 2,250 |
Accounts receivable - non-ASC 606 | 7,113 | 5,260 |
Total Accounts Receivable | 10,597 | 7,510 |
Less: Allowance for doubtful accounts | (299) | (291) |
Total Accounts Receivable, net | 10,298 | 7,219 |
Deferred income | 133 | 81 |
Revenue recognized | $ 15 | $ 176 |
Basis of Presentation and Sum_7
Basis of Presentation and Summary of Significant Accounting Policies (Cumulative Effect of Changes from Adoption of ASU) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Assets | |||
Right of use assets | $ 541 | $ 451 | $ 0 |
Liabilities | |||
Current portion of operating leases | 148 | 126 | 0 |
Long term portion of operating leases | $ 393 | 325 | $ 0 |
Accounting Standards Update 2016-02 | |||
Assets | |||
Right of use assets | 451 | ||
Liabilities | |||
Current portion of operating leases | 126 | ||
Long term portion of operating leases | $ 325 |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock Option Activity) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2019 | Dec. 31, 2018 | |
Number ofStock Options | ||
Outstanding, beginning of period (in shares) | 283,686 | |
Exercised (in shares) | (56,352) | |
Canceled/Forfeited (in shares) | (2,000) | |
Outstanding, end of period (in shares) | 225,334 | 283,686 |
Exercisable (in shares) | 214,901 | |
Weighted AverageExercise Price | ||
Outstanding, beginning of period (in USD per share) | $ 20.46 | |
Exercised (in USD per share) | 8.97 | |
Canceled/Forfeited (in USD per share) | 26.66 | |
Outstanding, end of period (in USD per share) | 23.28 | $ 20.46 |
Exercisable (in USD per share) | $ 23.04 | |
Weighted Average Remaining Contractual Life (years) | ||
Outstanding | 4 years 2 months 4 days | 3 years 6 months 29 days |
Exercisable | 4 years | |
Aggregate Intrinsic Value (in thousands) | ||
Outstanding, beginning of period | $ 434 | |
Exercised | 474 | |
Canceled/Forfeited | 0 | |
Outstanding, end of period | 26 | $ 434 |
Exercisable | $ 26 |
Stock-Based Compensation (Sto_2
Stock-Based Compensation (Stock Options Outstanding) (Details) | 3 Months Ended |
Mar. 31, 2019$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Options outstanding, shares (in shares) | shares | 225,334 |
Options outstanding, weighted average remaining contractual life (years) | 4 years 2 months 4 days |
Options outstanding, weighted average exercise price (in USD per share) | $ 23.28 |
Options exercisable, shares (in shares) | shares | 214,901 |
Options exercisable, weighted average exercise price (in USD per share) | $ 23.04 |
$0.01-15.70 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit (in USD per share) | 0.01 |
Range of exercise prices, upper limit (in USD per share) | $ 15.70 |
Options outstanding, shares (in shares) | shares | 8,500 |
Options outstanding, weighted average remaining contractual life (years) | 2 years 9 months 25 days |
Options outstanding, weighted average exercise price (in USD per share) | $ 14.89 |
Options exercisable, shares (in shares) | shares | 8,500 |
Options exercisable, weighted average exercise price (in USD per share) | $ 14.89 |
$15.71-17.81 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit (in USD per share) | 15.71 |
Range of exercise prices, upper limit (in USD per share) | $ 17.81 |
Options outstanding, shares (in shares) | shares | 42,000 |
Options outstanding, weighted average remaining contractual life (years) | 1 year 3 months 25 days |
Options outstanding, weighted average exercise price (in USD per share) | $ 17.54 |
Options exercisable, shares (in shares) | shares | 42,000 |
Options exercisable, weighted average exercise price (in USD per share) | $ 17.54 |
$17.82-20.48 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit (in USD per share) | 17.82 |
Range of exercise prices, upper limit (in USD per share) | $ 20.48 |
Options outstanding, shares (in shares) | shares | 50,500 |
Options outstanding, weighted average remaining contractual life (years) | 2 years 1 month 2 days |
Options outstanding, weighted average exercise price (in USD per share) | $ 19.43 |
Options exercisable, shares (in shares) | shares | 50,500 |
Options exercisable, weighted average exercise price (in USD per share) | $ 19.43 |
$20.49-33.36 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Range of exercise prices, lower limit (in USD per share) | 20.49 |
Range of exercise prices, upper limit (in USD per share) | $ 33.36 |
Options outstanding, shares (in shares) | shares | 124,334 |
Options outstanding, weighted average remaining contractual life (years) | 6 years 29 days |
Options outstanding, weighted average exercise price (in USD per share) | $ 27.36 |
Options exercisable, shares (in shares) | shares | 113,901 |
Options exercisable, weighted average exercise price (in USD per share) | $ 27.29 |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Unvested Stock Options) (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Shares | ||
Unvested, beginning of period (in shares) | 20,865 | |
Vested (in shares) | (10,432) | |
Unvested, end of period (in shares) | 10,433 | |
Weighted Average Grant Date Fair Value Per Share | ||
Unvested, weighted average grant date fair value, beginning of period (in USD per share) | $ 11.93 | |
Vested, weighted average grant date fair value (in USD per share) | 11.93 | |
Unvested, weighted average grant date fair value, end of period (in USD per share) | $ 11.93 | |
Stock Options | ||
Weighted Average Grant Date Fair Value Per Share | ||
Unrecognized compensation cost related to unvested options | $ 103,018 | |
Unrecognized compensation cost related to awards, weighted average period for recognition | 1 year | |
Share-based compensation expense | $ 30,779 | $ 66,625 |
Stock-Based Compensation (Restr
Stock-Based Compensation (Restricted Stock) (Details) - Restricted Stock - USD ($) | Mar. 29, 2019 | Mar. 31, 2019 | Mar. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 463,466 | $ 361,630 | |
Total unrecognized compensation expense | $ 2,600,000 | ||
Unrecognized compensation cost related to awards, vesting period | 2 years | ||
Chief Executive Officer | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 131,674 | ||
Award vesting period | 3 years | ||
Chief Financial Officer | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 20,000 | ||
Award vesting period | 3 years | ||
Vice President of Technical Services | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 20,000 | ||
Award vesting period | 3 years | ||
Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants in period (in shares) | 23,136 | ||
Award vesting period | 1 year |
Inventory (Details)
Inventory (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2018 | Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |||
Allowance for inventory obsolescence | $ 19,000 | $ 19,000 | |
Raw materials - current | 29,821,000 | 26,152,000 | |
Raw materials - long term, net | 3,997,000 | 3,980,000 | |
Finished Goods | 1,022,000 | 1,022,000 | |
Work in process | 4,656,000 | 3,800,000 | |
Inventory, net | 39,496,000 | $ 34,954,000 | |
Write-offs of obsolete inventory against allowance | $ 0 | $ 0 |
Deferred Compensation Plans (De
Deferred Compensation Plans (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Postemployment Benefits [Abstract] | ||
Participant's maximum compensation deferral percentage | 90.00% | |
Company owned life insurance | $ 1,200,000 | $ 966,000 |
Gain (loss) on company owned life insurance | 99,000 | (67,000) |
Deferred compensation obligation | $ 1,200,000 | $ 992,000 |
Deferred restricted stock shares (in shares) | 63,062 | 104,590 |
Deferred compensation arrangement with individual, shares issued (in shares) | 78,771 | 32,037 |
Deferred compensation arrangement, fair value of shares issued | $ 1,700,000 | $ 816,373 |
Credit Facility (Details)
Credit Facility (Details) - Revolving Credit Facility | 3 Months Ended | |
Mar. 31, 2019USD ($)loan | Dec. 31, 2018USD ($) | |
Line of Credit Facility [Line Items] | ||
Aggregate credit agreement commitment | $ 30,000,000 | |
Potential increase in borrowing capacity | 20,000,000 | |
Potential maximum borrowing capacity | $ 50,000,000 | |
Borrowing base, component, % of eligible accounts receivable | 80.00% | |
Borrowing base, component, % of eligible inventory | 50.00% | |
Borrowing base, allowable share of total commitment amount attributable to inventory component | 50.00% | |
Borrowing base, component, % of eligible equipment inventory | 75.00% | |
Borrowing base amount available | $ 29,500,000 | |
Weighted average interest rate | 3.75% | |
Default trigger, certain defaults of other company indebtedness, amount | $ 50,000 | |
Default trigger, rendering of certain judgments, amount | 150,000 | |
Line of credit balance | $ 417,000 | $ 417,000 |
LIBOR Rate | ||
Line of Credit Facility [Line Items] | ||
Reference rate, number of allowable LIBOR-based borrowings outstanding | loan | 3 | |
Variable rate, applicable margin | 1.50% | |
CB Floating Rate | ||
Line of Credit Facility [Line Items] | ||
Variable rate, applicable margin | 1.50% | |
Minimum | ||
Line of Credit Facility [Line Items] | ||
Minimum commitment coverage ratio allowed | 2 | |
Maximum | ||
Line of Credit Facility [Line Items] | ||
Maximum leverage ratio allowed | 2.50 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Right of use assets | $ 541 | $ 451 | $ 0 |
Operating lease, liability | 541 | ||
Lease costs | 193 | ||
Short-term lease cost | $ 146 | ||
Accounting Standards Update 2016-02 | |||
Lessee, Lease, Description [Line Items] | |||
Right of use assets | 451 | ||
Operating lease, liability | $ 451 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 10 years |
Leases (Balance Sheet Impact) (
Leases (Balance Sheet Impact) (Details) - USD ($) $ in Thousands | Mar. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Leases [Abstract] | |||
Right of use assets | $ 541 | $ 451 | $ 0 |
Current operating leases | 148 | 126 | 0 |
Long-term operating leases | 393 | $ 325 | $ 0 |
Total lease liabilities, net | $ 541 | ||
Weighted average remaining lease term in years | 3 years 1 month 6 days | ||
Implicit Rate | 3.80% |
Leases (Cash Flow Impact) (Deta
Leases (Cash Flow Impact) (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 48 |
Leases (Future Maturities of Le
Leases (Future Maturities of Lease Liabilities) (Details) $ in Thousands | Mar. 31, 2019USD ($) |
Leases [Abstract] | |
2019 (excluding the three months ended March 31, 2019) | $ 134 |
2020 | 116 |
2021 | 95 |
2022 | 43 |
2023 | 35 |
Thereafter | 190 |
Total lease payments | 613 |
Less: Imputed interest | 72 |
Operating lease, liability | $ 541 |
Leases (Future Minimum Obligati
Leases (Future Minimum Obligations Under Lease Commitments) (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 298 |
2020 | 118 |
2021 | 97 |
2022 | 44 |
2023 | 35 |
Thereafter | 15 |
Total | $ 607 |
Earnings per Share (Basic and D
Earnings per Share (Basic and Diluted) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2019 | Mar. 31, 2018 | |
Numerator: | ||
Net income | $ 357 | $ 225 |
Denominator for basic net income per common share: | ||
Weighted average common shares outstanding (in shares) | 13,064,000 | 12,920,000 |
Denominator for diluted net income per share: | ||
Dilutive effect of stock options and restricted stock (in shares) | 204,000 | 249,000 |
Diluted weighted average shares (in shares) | 13,268,000 | 13,169,000 |
Earnings per common share: | ||
Basic (in USD per share) | $ 0.03 | $ 0.02 |
Diluted (in USD per share) | $ 0.03 | $ 0.02 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares not included in the computation of dilutive income per share (in shares) | 174,834 | 83,917 |
Antidilutive Effect | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Exercise price of shares not included in the computation of dilutive income per share, lower limit (in USD per share) | $ 18.75 | $ 28.15 |
Exercise price of shares not included in the computation of dilutive income per share, upper limit (in USD per share) | $ 33.36 | $ 33.36 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2019USD ($)segment | Mar. 31, 2018USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 1 | |
Revenue | $ 17,991 | $ 14,718 |
Operating costs and corporate expenses | 17,782 | 14,368 |
Total other income (expense), net | 301 | (76) |
Income before provision for income taxes | 510 | 274 |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Revenue | 0 | 0 |
Operating costs and corporate expenses | 8,051 | 7,408 |
Total other income (expense), net | 301 | (76) |
Income before provision for income taxes | (7,750) | (7,484) |
Rental | ||
Segment Reporting Information [Line Items] | ||
Revenue | 13,387 | 11,471 |
Operating costs and corporate expenses | 5,885 | 4,704 |
Total other income (expense), net | 0 | 0 |
Income before provision for income taxes | 7,502 | 6,767 |
Sales | ||
Segment Reporting Information [Line Items] | ||
Revenue | 4,125 | 2,998 |
Operating costs and corporate expenses | 3,699 | 2,191 |
Total other income (expense), net | 0 | 0 |
Income before provision for income taxes | 426 | 807 |
Service and maintenance | ||
Segment Reporting Information [Line Items] | ||
Revenue | 479 | 249 |
Operating costs and corporate expenses | 147 | 65 |
Total other income (expense), net | 0 | 0 |
Income before provision for income taxes | $ 332 | $ 184 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Mar. 31, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual obligation | $ 3.7 |
Related Party (Narrative) (Deta
Related Party (Narrative) (Details) - Corporate Joint Venture - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | ||
Purchases from joint venture | $ 1 | |
N-G, LLC | ||
Related Party Transaction [Line Items] | ||
Percent ownership | 50.00% | |
Genis Holdings, LLC | N-G, LLC | ||
Related Party Transaction [Line Items] | ||
Percent ownership | 50.00% |