Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 14, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | WESTERN CAPITAL RESOURCES, INC. | |
Entity Central Index Key | 1,363,958 | |
Document Type | 10-Q | |
Trading Symbol | WCRS | |
Document Period End Date | Sep. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity a Well-known Seasoned Issuer | No | |
Entity a Voluntary Filer | No | |
Entity's Reporting Status Current | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 9,497,860 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
CURRENT ASSETS | ||
Cash | $ 7,895,897 | $ 7,847,669 |
Loans receivable (less allowance for losses of $993,000 and $1,177,000, respectively) | 4,411,062 | 4,884,438 |
Accounts receivable (less allowance for losses of $166,000 and $272,000, respectively) | 2,260,911 | 1,963,192 |
Inventory | 8,856,267 | 7,617,850 |
Prepaid expenses and other | 2,805,092 | 2,589,749 |
TOTAL CURRENT ASSETS | 26,229,229 | 24,902,898 |
PROPERTY AND EQUIPMENT, net | 9,314,175 | 8,561,321 |
GOODWILL | 13,355,592 | 13,355,591 |
INTANGIBLE ASSETS, net | 7,677,512 | 8,018,616 |
OTHER | 877,494 | 783,907 |
TOTAL ASSETS | 57,454,002 | 55,622,333 |
CURRENT LIABILITIES | ||
Accounts payable | 3,836,177 | 4,577,118 |
Accrued expenses and other liabilities | 5,486,943 | 6,232,267 |
Income taxes payable | 151,869 | 1,135,031 |
Note payable - short-term | 84,009 | |
Current portion long-term debt | 1,100,000 | 4,900,008 |
Current portion capital lease obligations | 60,464 | 23,860 |
Deferred revenue and other | 1,226,142 | 1,796,338 |
TOTAL CURRENT LIABILITIES | 11,945,604 | 18,664,622 |
LONG-TERM LIABILITIES | ||
Notes payable, net of current portion | 6,776,829 | 3,096,452 |
Capital lease obligations, net of current portion | 106,167 | 33,347 |
Deferred income taxes | 4,521,000 | 3,889,000 |
Other | 120,539 | 80,403 |
TOTAL LONG-TERM LIABILITIES | 11,524,535 | 7,099,202 |
TOTAL LIABILITIES | 23,470,139 | 25,763,824 |
COMMITMENTS AND CONTINGENCIES (Note 13) | ||
WESTERN SHAREHOLDERS' EQUITY | ||
Common stock, $0.001 and no par value, 12,500,000 shares authorized, 9,497,860 and 9,497,534 issued and outstanding. (Note 8) | 950 | |
Additional paid-in capital | 28,982,705 | 28,934,392 |
Retained earnings | 4,959,387 | 898,038 |
TOTAL WESTERN SHAREHOLDERS' EQUITY | 33,943,042 | 29,832,430 |
NONCONTROLLING INTERESTS | 40,821 | 26,079 |
TOTAL EQUITY | 33,983,863 | 29,858,509 |
TOTAL LIABILITIES AND EQUITY | $ 57,454,002 | $ 55,622,333 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Loans receivable, allowance | $ 993,000 | $ 1,177,000 |
Accounts receivable, allowance | $ 166,000 | $ 272,000 |
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, no par value (in dollars per share) | ||
Common stock, authorized | 12,500,000 | 12,500,000 |
Common stock, issued | 9,497,860 | 9,497,534 |
Common stock, outstanding | 9,497,860 | 9,497,534 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
REVENUES | ||||
Sales and associated fees | $ 13,066,705 | $ 13,403,791 | $ 52,146,348 | $ 27,039,059 |
Financing fees and interest | 2,562,569 | 2,865,842 | 7,387,757 | 8,007,438 |
Royalty and franchise fees, net | 3,056,046 | 2,803,405 | 8,446,416 | 7,883,214 |
Other revenue | 3,840,147 | 2,878,430 | 10,152,658 | 6,259,541 |
Total Revenues | 22,525,467 | 21,951,468 | 78,133,179 | 49,189,252 |
COST OF REVENUES | ||||
Cost of sales | 6,544,212 | 7,324,815 | 26,360,046 | 15,329,353 |
Provisions for loans receivable losses | 444,689 | 572,959 | 1,176,174 | 1,351,427 |
Other | 662,410 | 200,303 | 1,819,491 | 730,143 |
Total Cost of Revenues | 7,651,311 | 8,098,077 | 29,355,711 | 17,410,923 |
GROSS PROFIT | 14,874,156 | 13,853,391 | 48,777,468 | 31,778,329 |
OPERATING EXPENSES | ||||
Salaries, wages and benefits | 7,040,838 | 6,236,073 | 20,467,591 | 14,733,576 |
Occupancy | 2,081,592 | 2,016,406 | 5,949,389 | 4,729,718 |
Advertising, marketing and development | 1,076,102 | 1,142,751 | 5,293,633 | 1,513,578 |
Depreciation | 309,584 | 234,122 | 881,333 | 444,814 |
Amortization | 140,647 | 141,783 | 422,510 | 359,133 |
Other | 2,795,326 | 2,280,809 | 8,049,581 | 5,754,519 |
Total Operating Expense | 13,444,089 | 12,051,944 | 41,064,037 | 27,535,338 |
OPERATING INCOME | 1,430,067 | 1,801,447 | 7,713,431 | 4,242,991 |
OTHER INCOME (EXPENSES): | ||||
Interest income | 955 | 995 | 2,964 | 3,065 |
Interest expense | (93,665) | (198,048) | (413,390) | (401,299) |
Total Other Income (Expenses) | (92,710) | (197,053) | (410,426) | (398,234) |
INCOME BEFORE INCOME TAXES | 1,337,357 | 1,604,394 | 7,303,005 | 3,844,757 |
INCOME TAX EXPENSE | 551,000 | 724,293 | 2,752,000 | 1,696,813 |
NET INCOME | 786,357 | 880,101 | 4,551,005 | 2,147,944 |
Less net income attributable to noncontrolling interests | (6,004) | (6,498) | (14,742) | (12,485) |
NET INCOME ATTRIBUTABLE TO WESTERN COMMON SHAREHOLDERS | $ 780,353 | $ 873,603 | $ 4,536,263 | $ 2,135,459 |
EARNINGS PER SHARE ATTRIBUTABLE TO WESTERN COMMON SHAREHOLDERS | ||||
Basic and diluted (in dollars per share) | $ 0.08 | $ 0.09 | $ 0.48 | $ 0.3 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||||
Basic and diluted (in shares) | 9,497,608 | 9,497,689 | 9,497,559 | 7,177,176 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
OPERATING ACTIVITIES | ||
Net Income | $ 4,551,005 | $ 2,147,944 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 881,333 | 444,814 |
Amortization | 422,510 | 359,133 |
Share based compensation | 49,263 | 76,538 |
Deferred income taxes | 632,000 | 390,000 |
Loss on disposal of property and equipment | 8,014 | |
Changes in operating assets and liabilities: | ||
Loans receivable | 473,376 | 233,848 |
Accounts receivable | (297,719) | (492,684) |
Inventory | (1,238,417) | (1,645,395) |
Prepaid expenses and other assets | (224,921) | (612,532) |
Accounts payable and accrued liabilities | (2,469,429) | (468,720) |
Deferred revenue and other current liabilities | (570,196) | (137,896) |
Accrued liabilities and other | 40,136 | (21,252) |
Net cash provided by operating activities | 2,256,955 | 273,798 |
INVESTING ACTIVITIES | ||
Purchases of property and equipment | (1,244,715) | (507,075) |
Acquisition of stores, net of cash acquired | (588,241) | (2,608,500) |
Cash received through acquisitions | 2,470,930 | |
Proceeds from sale of property and equipment | 109,350 | |
Net cash used by investing activities | (1,723,606) | (644,645) |
FINANCING ACTIVITIES | ||
Payments on notes payable - short-term | (120,000) | |
Advances on line of credit, net | 1,538,708 | |
Advances on note payable - long-term | 418,301 | |
Payments on notes payable - long-term, net | (2,076,640) | (191,668) |
Advances (payments) on capital leases, net | 109,424 | (42,107) |
Dividend paid | (474,914) | |
Net cash used in financing activities | (485,121) | (353,775) |
NET INCREASE (DECREASE) IN CASH | 48,228 | (724,622) |
CASH | ||
Beginning of period | 7,847,669 | 4,273,350 |
End of period | 7,895,897 | 3,548,728 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Income taxes paid | 3,103,162 | 1,759,171 |
Interest paid | 550,231 | 392,751 |
Noncash investing and financing activities: | ||
Net assets acquired in JPPA/RAI/JPRE acquisition | 6,123,398 | |
Deposit applied to purchase of intangibles | 50,000 | |
Long-term debt proceeds used to pay off debt and interest | 3,021,699 | |
Long-term debt proceeds used to pay prepaid financing costs | $ 60,000 |
Basis of Presentation, Nature o
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies | 1. Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies – Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared according to the instructions to Form 10-Q and Section 210.8-03(b) of Regulation S-X of the Securities and Exchange Commission (SEC) and, therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine month period ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. For further information, refer to the Condensed Consolidated Financial Statements and footnotes thereto included in our Form 10-K for the year ended December 31, 2015. The condensed consolidated balance sheet at December 31, 2015, has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP. Nature of Business Western Capital Resources, Inc. (“WCR”) is a parent company owning operating subsidiaries, with percentage owned shown parenthetically, as summarized below: • Franchise o AlphaGraphics, Inc. (“AGI”) (99.2%) – franchisor of 258 domestic and 25 international AlphaGraphics Business Centers which specialize in the planning, production and management of visual communications for businesses and individuals throughout the world. • Cellular Retail o PQH Wireless, Inc. and subsidiaries (“PQH”) (100%) – owns and operates 126 cellular retail stores as an exclusive dealer of the Cricket brand. • Direct to Consumer o J & P Park Acquisitions, Inc. (“JPPA”) (100% – Acquired July 1, 2015) – an online and direct marketing distribution retailer of live plants, seeds, holiday gifts and garden accessories selling its products under Park Seed, Jackson & Perkins, and Wayside Gardens brand names as well as a wholesaler under the Park Wholesale brand. o Restorers Acquisition, Inc. (“RAI”) (100% – Acquired July 1, 2015) – an online and direct marketing distribution retailer of home improvement and restoration products operating under Van Dyke’s Restorers. o J & P Real Estate, LLC (“JPRE”) (100% – Acquired July 1, 2015) – owns real estate utilized as JPPA’s distribution and warehouse facility and the corporate offices of JPPA and RAI. • Consumer Finance o Wyoming Financial Lenders, Inc. (“WFL”) (100%) – owns and operates 45 “payday” stores in eight states (Colorado, Iowa, Kansas, Nebraska, North Dakota, South Dakota, Wisconsin and Wyoming) providing sub-prime short-term uncollateralized non-recourse “cash advance” or “payday” loans typically ranging from $100 to $500 with a maturity of generally two to four weeks, sub-prime short-term uncollateralized non-recourse installment loans typically ranging from $300 to $800 with a maturity of six months, check cashing and other money services to individuals. o Express Pawn, Inc. (“EPI”) (100%) – owns and operates three retail pawn stores in Nebraska and Iowa providing collateralized non-recourse pawn loans and retail sales of merchandise obtained from forfeited pawn loans or purchased from customers. References in these financial statement notes to “Company” or “we” refer to Western Capital Resources, Inc. and its subsidiaries. References to specific companies within our enterprise, such “AGI,” “PQH,” “JPPA,” “RAI,” “JPRE,” “WFL” or “EPI” are references only to those companies. Basis of Consolidation The consolidated financial statements include the accounts of WCR, its wholly owned subsidiaries and other entities in which the Company owns a controlling financial interest. For financial interests in which the Company owns a controlling financial interest, the Company applies the provisions of ASC 810 applicable to reporting the equity and net income or loss attributable to noncontrolling interests. All significant intercompany balances and transactions of the Company have been eliminated in consolidation. Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect certain reported amounts and disclosures in the condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant management estimates relate to the notes and loans receivable allowance, carrying value and impairment of long-lived goodwill and intangible assets, inventory valuation and obsolescence, estimated useful lives of property and equipment, gift certificate and customer credits liability and deferred taxes and tax uncertainties. Reclassifications Certain Statements of Income reclassifications have been made in the presentation of our prior financial statements and accompanying notes to conform to the presentation as of and for the three and nine months ended September 30, 2016. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under US GAAP. This standard, including subsequent updates, is effective for annual and interim periods beginning after December 15, 2017. The Company is currently assessing the potential effects on our financial condition, results of operations and consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”). The standard requires that deferred tax assets and liabilities be classified as noncurrent on the balance sheet rather than being separated into current and noncurrent. ASU 2015-17 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted and the standard may be applied either retrospectively or on a prospective basis to all deferred tax assets and liabilities. The Company early adopted ASU 2015-17 during our first quarter of fiscal year 2016 on a retrospective basis. Accordingly, we reclassified the current deferred taxes to noncurrent on our December 31, 2015 Condensed Consolidated Balance Sheet, which decreased current deferred tax assets by $0.56 million and decreased noncurrent deferred tax liabilities by $0.56 million. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The standard requires recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted and the standard is to be applied using a modified retrospectively approach. The Company is currently evaluating the impact that ASU 2016-02 will have on our financial condition, results of operations and consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted earlier as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years and the standard is to be applied using a modified retrospectively approach. The Company is currently evaluating the impact that ASU 2016-13 will have on our financial condition, results of operations and consolidated financial statements. No other accounting pronouncements issued or effective during the fiscal quarter have had or are expected to have a material impact on our condensed consolidated financial statements. |
Risks Inherent in the Operating
Risks Inherent in the Operating Environment | 9 Months Ended |
Sep. 30, 2016 | |
Risks and Uncertainties [Abstract] | |
Risks Inherent in the Operating Environment | 2. Risks Inherent in the Operating Environment – Regulatory The Company’s Consumer Finance segment activities are highly regulated under numerous local, state, and federal laws, regulations and rules, which are subject to change. New laws, regulations or rules could be enacted or issued, interpretations of existing laws, regulations or rules may change and enforcement action by regulatory agencies may intensify. Over the past several years, consumer advocacy groups and certain media reports have advocated governmental and regulatory action to prohibit or severely restrict sub-prime lending activities of the kind conducted by the Company. The federal Consumer Financial Protection Bureau has indicated that it will use its authority to further regulate the payday industry and has been actively enforcing existing regulations within its jurisdiction. Any adverse change in present local, state, and federal laws or regulations that govern or otherwise affect lending could result in the Consumer Finance segment’s curtailment or cessation of operations in certain or all jurisdictions or locations. Furthermore, any failure to comply with any applicable local, state or federal laws or regulations could result in fines, litigation, closure of one or more store locations or negative publicity. Any such change or failure would have a corresponding impact on the Company’s and segment’s results of operations and financial condition, and could also negatively affect the Company’s general business prospects due to lost or decreased operating income or if negative publicity effects its ability to obtain additional financing as needed. In addition, the passage of federal or state laws and regulations or changes in interpretations of them could, at any point, essentially prohibit the Consumer Finance segment from conducting its lending business in its current form. Any such legal or regulatory change would certainly have a material and adverse effect on the Company, its operating results, financial condition and prospects, and perhaps even the viability of the Consumer Finance segment. |
Loans Receivable
Loans Receivable | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Loans Receivable | 3. Loans Receivable – At September 30, 2016 and December 31, 2015, the Consumer Finance segment’s outstanding loans receivable aging was as follows: September 30, 2016 Payday Installment Pawn & Total Current $ 3,645,540 $ 248,820 $ 282,212 $ 4,176,572 1-30 290,044 46,460 - 336,504 31-60 249,995 23,836 - 273,831 61-90 175,254 15,287 - 190,541 91-120 150,320 10,087 - 160,407 121-150 131,000 3,684 - 134,684 151-180 129,724 1,799 - 131,523 4,771,877 349,973 282,212 5,404,062 Less Allowance (920,000 ) (73,000 ) - (993,000 ) $ 3,851,877 $ 276,973 $ 282,212 $ 4,411,062 December 31, 2015 Payday Installment Pawn & Total Current $ 4,065,706 $ 291,947 $ 286,514 $ 4,644,167 1-30 332,217 43,179 - 375,396 31-60 263,486 24,233 - 287,719 61-90 199,526 16,293 - 215,819 91-120 196,123 9,417 - 205,540 121-150 160,386 4,985 - 165,371 151-180 165,237 2,189 - 167,426 5,382,681 392,243 286,514 6,061,438 Less Allowance (1,081,000 ) (96,000 ) - (1,177,000 ) $ 4,301,681 $ 296,243 $ 286,514 $ 4,884,438 |
Loans Receivable Allowance
Loans Receivable Allowance | 9 Months Ended |
Sep. 30, 2016 | |
Provision for Loan and Lease Losses [Abstract] | |
Loans Receivable Allowance | 4. Loans Receivable Allowance – As a result of the Consumer Finance segment’s collection efforts, it historically writes off approximately 43% of returned payday items. Based on days past the check return date, write-offs of payday returned items historically have tracked at the following approximate percentages: 1 to 30 days – 43%; 31 to 60 days – 65%; 61 to 90 days – 83%; 91 to 120 days – 89%; 121 to 150 days – 91%; and 151 + days – 93%. A rollforward of the Consumer Finance segment’s loans receivable allowance is as follows: Nine Months Ended Year Ended December 31, 2015 Loans receivable allowance, beginning of period $ 1,177,000 $ 1,219,000 Provision for loan losses charged to expense 1,176,174 1,904,893 Charge-offs, net (1,360,174 ) (1,946,893 ) Loans receivable allowance, end of period $ 993,000 $ 1,177,000 |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Accounts Receivable | 5. Accounts Receivable – A breakdown of accounts receivables by segment as of September 30, 2016 and December 31, 2015 are as follows: September 30, 2016 Franchise Cellular Direct to Consumer Total Accounts receivable $ 1,624,351 $ 172,813 $ 619,568 $ 10,179 $ 2,426,911 Less allowance (149,000 ) - (17,000 ) - (166,000 ) Net account receivable $ 1,475,351 $ 172,813 $ 602,568 10,179 $ 2,260,911 December 31, 2015 Franchise Cellular Direct to Consumer Total Accounts receivable $ 1,332,446 $ 148,346 $ 754,400 $ - $ 2,235,192 Less allowance (183,000 ) - (89,000 ) - (272,000 ) Net account receivable $ 1,149,446 $ 148,346 $ 665,400 - $ 1,963,192 |
Deferred Revenue and Other Liab
Deferred Revenue and Other Liabilities | 9 Months Ended |
Sep. 30, 2016 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue and Other Liabilities | 6. Deferred Revenue and Other Liabilities – Deferred revenue and other liabilities consist of the following: September 30, 2016 December 31, 2015 Deferred financing fees $ 265,779 $ 285,452 Deferred franchise development and service fees 130,500 264,000 Merchandise credits and gift card liability 694,302 1,127,470 Other 135,561 119,416 Total $ 1,226,142 $ 1,796,338 |
Notes Payable - Long Term
Notes Payable - Long Term | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Notes Payable - Long Term | 7. Notes Payable – Long Term September 30, 2016 December 31, 2015 Note payable (with a credit limit of $3,000,000) to River City Equity, Inc., a related party, with interest payable monthly at 12% due June 30, 2016 and upon certain events can be collateralized by substantially all assets of WCR, excluding any equity interest in AGI (terminated May 2016) $ $ 3,000,000 Note pa yab le to a financial institution with monthly principal payment of $58,333 plus interest at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by substantially all assets of the Company with stated guarantee amounts by subsidiaries, maturing April 21, 2021 3,266,667 - Revolving credit facility (with a credit limit of $3,000,000) to a financial institution with monthly payments of interest only at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by substantially all assets of the Company with stated guarantee amounts by subsidiaries, maturing April 21, 2018 1,538,708 - Subsidiary note payable to a financial institution with quarterly principal payments of $375,000 plus interest at prime rate plus 2.5%, secured by the AGI’s assets, maturing March 2017 (terminated May 2016) - 1,625,000 Subsidiary note pa yab le to a financial institution with monthly principal payment of $33,334 plus annual paydowns equal to JPRE’s net cash flow from operations due within 120 days of the calendar year end plus interest at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by JPRE assets, maturing June 5, 2019 when remaining principal balance is due 3,071,454 3,371,460 Total 7,876,829 7,996,460 Less current maturities (1,100,000 ) (4,900,008 ) $ 6,776,829 $ 3,096,452 Future minimum long-term principal payments are as follows: Year Amount 1 $ 1,100,000 2 2,638,716 3 2,971,446 4 700,000 5 466,667 Thereafter - $ 7,876,829 On April 22, 2016, WCR entered into a Credit Agreement with a financial institution. The Credit Agreement provides the Company with an acquisition loan facility in an aggregate amount of up to $9,000,000, having commitment a maturity date of April 21, 2018. Funds advanced under the acquisition loan facility bear interest at a floating per annum rate equal to one-month LIBOR plus 3.50%, adjusted on a monthly basis, and mature five years from the date of advance. At closing, $3,500,000 was advanced under the acquisition loan replacing the $3,000,000 River City Equity debt and $500,000 of other term debt. At September 30, 2016 approximately $7,195,000 of credit was available under the acquisition and revolving credit facilities. See Note 13 for additional terms and conditions related to the Credit Agreement. |
Reincorporation
Reincorporation | 9 Months Ended |
Sep. 30, 2016 | |
Reincorporation | |
Reincorporation | 8. Reincorporation – On January 20, 2016, our shareholders approved a plan to reincorporate Western Capital Resources, Inc. in Delaware at a special meeting of the shareholders called for that purpose. The reincorporation was completed May 11, 2016. |
Cash Dividends
Cash Dividends | 9 Months Ended |
Sep. 30, 2016 | |
Dividends, Common Stock [Abstract] | |
Cash Dividend | 9. Cash Dividends – Date declared May 24, 2016 August 11, 2016 Record date June 6, 2016 September 14, 2016 Date paid June 15, 2016 September 21, 2016 Dividend per share of common stock $ 0.025 $ 0.025 |
Other Operating Expense
Other Operating Expense | 9 Months Ended |
Sep. 30, 2016 | |
Other Income and Expenses [Abstract] | |
Other Operating Expense | 10. Other Operating Expense – A breakout of other expense is as follows: Three Months Ended Nine Months Ended 2016 2015 2016 2015 Bank fees $ 337,939 $ 310,419 $ 1,273,057 $ 595,164 Collection costs 85,306 99,587 311,457 319,890 Conference expense 468,124 460,602 762,680 671,287 Insurance 184,106 110,788 528,995 286,783 Management and advisory fees 195,425 125,754 619,954 400,057 Professional and consulting fees 488,978 483,575 1,531,923 1,401,683 Supplies 231,995 167,480 591,919 496,116 Other 803,453 522,604 2,429,596 1,583,539 $ 2,795,326 $ 2,280,809 $ 8,049,581 $ 5,754,519 |
Pro Forma Information
Pro Forma Information | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Pro Forma Information | 11. Pro Forma Information – Effective June 1, 2015, PQH purchased with cash all outstanding membership interests in four separate limited liability companies (Green Communications, LLC, an Arizona LLC, Green Communications, LLC, an Oregon LLC, Green Communications, LLC, a Washington LLC and Go Green, LLC an Arizona LLC). Effective July 1, 2015, the Company acquired a 100% interest in the businesses of RAI, JPPA, and JPRE, by completing a merger and contribution transaction. The results of the operations for the acquired business have been included in the consolidated financial statements since the dates of the acquisition. The following table presents the unaudited results of operations for the three and nine months ended September 30, 2016 and the unaudited pro forma results of operations for the three and nine months ended September 30, 2015 (in thousands, except for per share data) as if the acquisitions had been consummated at the beginning of 2015. The pro forma net income below excludes the expense of the transactions. The pro forma results of operations are prepared for comparative purposes only and do not necessarily reflect the results that would have occurred had the acquisition occurred at the beginning of the 2015 or the results which may occur in the future. Franchise Cellular Direct to Consumer Corporate Total Three Months Ended September 30, 2016 Revenue $ 4,278 $ 9,294 $ 5,944 $ 3,009 $ - $ 22,525 % of total revenue 19.0 % 41.2 % 26.4 % 13.4 % -% 100.0 % Net income (loss) $ 749 $ 73 $ (325 ) $ 391 $ (102 ) $ 786 Net income attributable to noncontrolling interests $ 6 $ - $ - $ - $ - $ 6 Net income (loss) attributable to WCR common shareholders $ 743 $ 73 $ (325 ) $ 391 $ (102 ) $ 780 Earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.078 $ 0.008 $ (0.034 ) $ 0.041 $ (0.011 ) $ 0.082 Three Months Ended September 30, 2015 Pro forma revenue $ 3,675 $ 9,537 $ 5,442 $ 3,297 $ - $ 21,951 % of total pro forma revenue 16.7 % 43.5 % 24.8 % 15.0 % -% 100.0 % Pro forma net income (loss) $ 829 $ 443 $ (569 ) $ 390 $ (167 ) $ 926 Pro forma net income attributable to noncontrolling interests $ 6 $ - $ - $ - $ - $ 6 Pro forma net income (loss) attributable to WCR common shareholders $ 823 $ 443 $ (569 ) $ 390 $ (167 ) $ 920 Pro forma earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.087 $ 0.047 $ (0.060 ) $ 0.041 $ (0.018 ) $ 0.097 Franchise Cellular Direct to Consumer Corporate Total Nine Months Ended September 30, 2016 Revenue $ 11,452 $ 27,152 $ 30,699 $ 8,830 $ - $ 78,133 % of total revenue 14.6 % 34.8 % 39.3 % 11.3 % -% 100.0 % Net income (loss) $ 1,834 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,551 Net income attributable to noncontrolling interests $ 15 $ - $ - $ - $ - $ 15 Net income (loss) attributable to WCR common shareholders $ 1,819 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,536 Earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.192 $ 0.055 $ 0.177 $ 0.102 $ (0.048 ) $ 0.478 Nine Months Ended September 30, 2015 Pro forma revenue $ 9,641 $ 29,632 $ 30,296 $ 9,451 $ - $ 79,020 % of total pro forma revenue 12.2 % 37.5 % 38.3 % 12.0 % -% 100.0 % Pro forma net income (loss) $ 1,585 $ 967 $ 1,365 $ 932 $ (408 ) $ 4,441 Pro forma net income attributable to noncontrolling interests $ 13 $ - $ - $ - $ - $ 13 Pro forma net income (loss) attributable to WCR common shareholders $ 1,572 $ 967 $ 1,365 $ 932 $ (408 ) $ 4,428 Pro forma earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.165 $ 0.102 $ 0.144 $ 0.098 $ (0.043 ) $ 0.466 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Segment Information | 12. Segment Information – Segment information related to the three and nine month periods ended September 30, 2016 and 2015 is presented below: Three Months Ended September 30, 2016 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 4,278 $ 9,294 $ 5,944 $ 3,009 $ - $ 22,525 Net income (loss) $ 749 $ 73 $ (325 ) $ 391 $ (102 ) $ 786 Expenditures for segmented assets $ 3 $ 241 $ 50 $ 21 $ - $ 315 Three Months Ended September 30, 2015 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 3,675 $ 9,537 $ 5,442 $ 3,297 $ - $ 21,951 Net income (loss) $ 829 $ 443 $ (569 ) $ 390 $ (213 ) $ 880 Expenditures for segmented assets $ - $ - $ 186 $ 29 $ - $ 215 Nine Months Ended September 30, 2016 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 11,452 $ 27,152 $ 30,699 $ 8,830 $ - $ 78,133 Net income (loss) $ 1,834 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,551 Total segment assets $ 10,111 $ 16,472 $ 14,723 $ 15,735 $ 413 $ 57,454 Expenditures for segmented assets $ 19 $ 1,688 $ 89 $ 39 $ - $ 1,835 Nine Months Ended September 30, 2015 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 9,641 $ 24,655 $ 5,442 $ 9,451 $ - $ 49,189 Net income (loss) $ 1,585 $ 910 $ (569 ) $ 932 $ (710 ) $ 2,148 Total segment assets $ 9,379 $ 12,823 $ 13,568 $ 16,299 $ 544 $ 52,613 Expenditures for segmented assets |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. Commitments and Contingencies – Employment Agreements The Company is party to an Amended and Restated Employment Agreement with its Chief Executive Officer, Mr. John Quandahl. Among other things, this agreement contains provisions for an annual performance-based cash bonus pool for management. The agreement was amended April 1, 2016 to extend the term through March 2019. Pursuant to the Company’s numerous employment agreements, bonuses of approximately $390,000 and $1,083,000 were accrued for the three and nine month periods ended September 30, 2016, respectively. Credit Facility On April 22, 2016, WCR entered into a Credit Agreement with a financial institution. Certain company subsidiaries are guarantors of the borrowings and obligations under the Credit Agreement. All borrowings under the Credit Agreement are secured by substantially all assets of WCR and the guarantor subsidiaries. The Credit Agreement requires WCR to meet certain financial tests, including a leverage ratio and a fixed charge coverage ratio, as defined in the Credit Agreement. Subject to certain exceptions, the Credit Agreement contains covenants limiting the company’s ability to (or to permit the guarantor subsidiaries to) merge or consolidate with, or engage in a sale of substantially all assets to, any party, but WCR or any guarantor subsidiary generally may nonetheless merge with another party if (i) WCR or guarantor subsidiary is the entity surviving such merger, and (ii) immediately after giving effect to such merger, no default shall have occurred and be continuing under the Credit Agreement. Subject to certain exceptions, the Credit Agreement also contains covenants limiting WCR’s ability to (or to permit the guarantor subsidiaries to) create liens on assets, incur additional indebtedness, make certain types of investments, and pay dividends or make certain other types of restricted payments, but WCR may nonetheless pay dividends to its shareholders if (a) there are no outstanding loans or unpaid interest under the revolving credit facility, and (b) no default shall have occurred and be continuing under the Credit Agreement. Some covenant waivers were granted by the financial institution during the three months ended September 30, 2016. Cellular Retail Growth Commitment Effective June 6, 2016, PQH entered into a Cricket Wireless Exclusive Dealer Agreement Amendment for Retail Expansion. Per the agreement, PQH commits to open at least 150 locations by December 31, 2017, including 50 locations by December 31, 2016. Also effective June 6, 2016, Cricket Wireless, LLC has increased certain compensation arrangements in the existing dealer agreement and will provide a subsidy for each location opened during the term of the agreement. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 14. Subsequent Events – Wireless Retail Transaction PQH entered into an Asset Purchase Agreement for the acquisition of 20 Cricket Wireless retail locations for $2,050,000 and an option to purchase an additional 33 locations for an aggregate purchase price of $7,200,000. In addition, if PQH exercised its option, seller has an option to retain a 30% ownership in the 53 store transaction, with a corresponding adjustment to the purchase price. It is anticipated that the transaction will close in November 2016. Consumer Finance Segment Law Change On November 8, 2016, South Dakota voters approved a measure effectively banning payday lending in South Dakota. Unless delayed, the effective date of the measure will be November 16, 2016. Revenue generated in South Dakota is approximately 5% of Consumer Finance segment year to date revenue through September 30, 2016. The Company evaluated all other events or transactions that occurred after September 30, 2016 up through November 14, 2016, the date we issued these financial statements. During this period we did not have any additional material subsequent events that impacted our financial statements. |
Basis of Presentation, Nature20
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared according to the instructions to Form 10-Q and Section 210.8-03(b) of Regulation S-X of the Securities and Exchange Commission (SEC) and, therefore, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine month period ended September 30, 2016 are not necessarily indicative of the results that may be expected for the year ending December 31, 2016. For further information, refer to the Condensed Consolidated Financial Statements and footnotes thereto included in our Form 10-K for the year ended December 31, 2015. The condensed consolidated balance sheet at December 31, 2015, has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP. |
Nature of Business | Nature of Business Western Capital Resources, Inc. (“WCR”) is a parent company owning operating subsidiaries, with percentage owned shown parenthetically, as summarized below: • Franchise o AlphaGraphics, Inc. (“AGI”) (99.2%) – franchisor of 258 domestic and 25 international AlphaGraphics Business Centers which specialize in the planning, production and management of visual communications for businesses and individuals throughout the world. • Cellular Retail o PQH Wireless, Inc. and subsidiaries (“PQH”) (100%) – owns and operates 126 cellular retail stores as an exclusive dealer of the Cricket brand. • Direct to Consumer o J & P Park Acquisitions, Inc. (“JPPA”) (100% – Acquired July 1, 2015) – an online and direct marketing distribution retailer of live plants, seeds, holiday gifts and garden accessories selling its products under Park Seed, Jackson & Perkins, and Wayside Gardens brand names as well as a wholesaler under the Park Wholesale brand. o Restorers Acquisition, Inc. (“RAI”) (100% – Acquired July 1, 2015) – an online and direct marketing distribution retailer of home improvement and restoration products operating under Van Dyke’s Restorers. o J & P Real Estate, LLC (“JPRE”) (100% – Acquired July 1, 2015) – owns real estate utilized as JPPA’s distribution and warehouse facility and the corporate offices of JPPA and RAI. • Consumer Finance o Wyoming Financial Lenders, Inc. (“WFL”) (100%) – owns and operates 45 “payday” stores in eight states (Colorado, Iowa, Kansas, Nebraska, North Dakota, South Dakota, Wisconsin and Wyoming) providing sub-prime short-term uncollateralized non-recourse “cash advance” or “payday” loans typically ranging from $100 to $500 with a maturity of generally two to four weeks, sub-prime short-term uncollateralized non-recourse installment loans typically ranging from $300 to $800 with a maturity of six months, check cashing and other money services to individuals. o Express Pawn, Inc. (“EPI”) (100%) – owns and operates three retail pawn stores in Nebraska and Iowa providing collateralized non-recourse pawn loans and retail sales of merchandise obtained from forfeited pawn loans or purchased from customers. References in these financial statement notes to “Company” or “we” refer to Western Capital Resources, Inc. and its subsidiaries. References to specific companies within our enterprise, such “AGI,” “PQH,” “JPPA,” “RAI,” “JPRE,” “WFL” or “EPI” are references only to those companies. |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of WCR, its wholly owned subsidiaries and other entities in which the Company owns a controlling financial interest. For financial interests in which the Company owns a controlling financial interest, the Company applies the provisions of ASC 810 applicable to reporting the equity and net income or loss attributable to noncontrolling interests. All significant intercompany balances and transactions of the Company have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect certain reported amounts and disclosures in the condensed consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant management estimates relate to the notes and loans receivable allowance, carrying value and impairment of long-lived goodwill and intangible assets, inventory valuation and obsolescence, estimated useful lives of property and equipment, gift certificate and customer credits liability and deferred taxes and tax uncertainties. |
Reclassifications | Reclassifications Certain Statements of Income reclassifications have been made in the presentation of our prior financial statements and accompanying notes to conform to the presentation as of and for the three and nine months ended September 30, 2016. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under US GAAP. This standard, including subsequent updates, is effective for annual and interim periods beginning after December 15, 2017. The Company is currently assessing the potential effects on our financial condition, results of operations and consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes” (“ASU 2015-17”). The standard requires that deferred tax assets and liabilities be classified as noncurrent on the balance sheet rather than being separated into current and noncurrent. ASU 2015-17 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016. Early adoption is permitted and the standard may be applied either retrospectively or on a prospective basis to all deferred tax assets and liabilities. The Company early adopted ASU 2015-17 during our first quarter of fiscal year 2016 on a retrospective basis. Accordingly, we reclassified the current deferred taxes to noncurrent on our December 31, 2015 Condensed Consolidated Balance Sheet, which decreased current deferred tax assets by $0.56 million and decreased noncurrent deferred tax liabilities by $0.56 million. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The standard requires recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted and the standard is to be applied using a modified retrospectively approach. The Company is currently evaluating the impact that ASU 2016-02 will have on our financial condition, results of operations and consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). The standard requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted earlier as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years and the standard is to be applied using a modified retrospectively approach. The Company is currently evaluating the impact that ASU 2016-13 will have on our financial condition, results of operations and consolidated financial statements. No other accounting pronouncements issued or effective during the fiscal quarter have had or are expected to have a material impact on our condensed consolidated financial statements. |
Loans Receivable (Tables)
Loans Receivable (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Schedule of outstanding loans receivable aging | At September 30, 2016 and December 31, 2015, the Consumer Finance segment’s outstanding loans receivable aging was as follows: September 30, 2016 Payday Installment Pawn & Total Current $ 3,645,540 $ 248,820 $ 282,212 $ 4,176,572 1-30 290,044 46,460 - 336,504 31-60 249,995 23,836 - 273,831 61-90 175,254 15,287 - 190,541 91-120 150,320 10,087 - 160,407 121-150 131,000 3,684 - 134,684 151-180 129,724 1,799 - 131,523 4,771,877 349,973 282,212 5,404,062 Less Allowance (920,000 ) (73,000 ) - (993,000 ) $ 3,851,877 $ 276,973 $ 282,212 $ 4,411,062 December 31, 2015 Payday Installment Pawn & Total Current $ 4,065,706 $ 291,947 $ 286,514 $ 4,644,167 1-30 332,217 43,179 - 375,396 31-60 263,486 24,233 - 287,719 61-90 199,526 16,293 - 215,819 91-120 196,123 9,417 - 205,540 121-150 160,386 4,985 - 165,371 151-180 165,237 2,189 - 167,426 5,382,681 392,243 286,514 6,061,438 Less Allowance (1,081,000 ) (96,000 ) - (1,177,000 ) $ 4,301,681 $ 296,243 $ 286,514 $ 4,884,438 |
Loans Receivable Allowance (Tab
Loans Receivable Allowance (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Provision for Loan and Lease Losses [Abstract] | |
Schedule of loans receivable allowance | A rollforward of the Consumer Finance segment’s loans receivable allowance is as follows: Nine Months Ended Year Ended December 31, 2015 Loans receivable allowance, beginning of period $ 1,177,000 $ 1,219,000 Provision for loan losses charged to expense 1,176,174 1,904,893 Charge-offs, net (1,360,174 ) (1,946,893 ) Loans receivable allowance, end of period $ 993,000 $ 1,177,000 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Receivables [Abstract] | |
Schedule of accounts receivables | A breakdown of accounts receivables by segment as of September 30, 2016 and December 31, 2015 are as follows: September 30, 2016 Franchise Cellular Direct to Consumer Total Accounts receivable $ 1,624,351 $ 172,813 $ 619,568 $ 10,179 $ 2,426,911 Less allowance (149,000 ) - (17,000 ) - (166,000 ) Net account receivable $ 1,475,351 $ 172,813 $ 602,568 10,179 $ 2,260,911 December 31, 2015 Franchise Cellular Direct to Consumer Total Accounts receivable $ 1,332,446 $ 148,346 $ 754,400 $ - $ 2,235,192 Less allowance (183,000 ) - (89,000 ) - (272,000 ) Net account receivable $ 1,149,446 $ 148,346 $ 665,400 - $ 1,963,192 |
Deferred Revenue and Other Li24
Deferred Revenue and Other Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Deferred Revenue Disclosure [Abstract] | |
Schedule of deferred revenue and other liabilities | Deferred revenue and other liabilities consist of the following: September 30, 2016 December 31, 2015 Deferred financing fees $ 265,779 $ 285,452 Deferred franchise development and service fees 130,500 264,000 Merchandise credits and gift card liability 694,302 1,127,470 Other 135,561 119,416 Total $ 1,226,142 $ 1,796,338 |
Notes Payable - Long Term (Tabl
Notes Payable - Long Term (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | September 30, 2016 December 31, 2015 Note payable (with a credit limit of $3,000,000) to River City Equity, Inc., a related party, with interest payable monthly at 12% due June 30, 2016 and upon certain events can be collateralized by substantially all assets of WCR, excluding any equity interest in AGI (terminated May 2016) $ $ 3,000,000 Note pa yab le to a financial institution with monthly principal payment of $58,333 plus interest at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by substantially all assets of the Company with stated guarantee amounts by subsidiaries, maturing April 21, 2021 3,266,667 - Revolving credit facility (with a credit limit of $3,000,000) to a financial institution with monthly payments of interest only at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by substantially all assets of the Company with stated guarantee amounts by subsidiaries, maturing April 21, 2018 1,538,708 - Subsidiary note payable to a financial institution with quarterly principal payments of $375,000 plus interest at prime rate plus 2.5%, secured by the AGI’s assets, maturing March 2017 (terminated May 2016) - 1,625,000 Subsidiary note pa yab le to a financial institution with monthly principal payment of $33,334 plus annual paydowns equal to JPRE’s net cash flow from operations due within 120 days of the calendar year end plus interest at LIBOR plus 3.5% (4.125% at September 30, 2016), secured by JPRE assets, maturing June 5, 2019 when remaining principal balance is due 3,071,454 3,371,460 Total 7,876,829 7,996,460 Less current maturities (1,100,000 ) (4,900,008 ) $ 6,776,829 $ 3,096,452 |
Schedule of future minimum long-term principal payments | Future minimum long-term principal payments are as follows: Year Amount 1 $ 1,100,000 2 2,638,716 3 2,971,446 4 700,000 5 466,667 Thereafter - $ 7,876,829 |
Cash Dividend (Tables)
Cash Dividend (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Dividends, Common Stock [Abstract] | |
Schedule of cash dividend | Date declared May 24, 2016 August 11, 2016 Record date June 6, 2016 September 14, 2016 Date paid June 15, 2016 September 21, 2016 Dividend per share of common stock $ 0.025 $ 0.025 |
Other Operating Expense (Tables
Other Operating Expense (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Other Income and Expenses [Abstract] | |
Schedule of other expense | A breakout of other expense is as follows: Three Months Ended Nine Months Ended 2016 2015 2016 2015 Bank fees $ 337,939 $ 310,419 $ 1,273,057 $ 595,164 Collection costs 85,306 99,587 311,457 319,890 Conference expense 468,124 460,602 762,680 671,287 Insurance 184,106 110,788 528,995 286,783 Management and advisory fees 195,425 125,754 619,954 400,057 Professional and consulting fees 488,978 483,575 1,531,923 1,401,683 Supplies 231,995 167,480 591,919 496,116 Other 803,453 522,604 2,429,596 1,583,539 $ 2,795,326 $ 2,280,809 $ 8,049,581 $ 5,754,519 |
Pro Forma Information (Tables)
Pro Forma Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of business acquisition, pro forma | The pro forma results of operations are prepared for comparative purposes only and do not necessarily reflect the results that would have occurred had the acquisition occurred at the beginning of the 2015 or the results which may occur in the future. Franchise Cellular Direct to Consumer Corporate Total Three Months Ended September 30, 2016 Revenue $ 4,278 $ 9,294 $ 5,944 $ 3,009 $ - $ 22,525 % of total revenue 19.0 % 41.2 % 26.4 % 13.4 % -% 100.0 % Net income (loss) $ 749 $ 73 $ (325 ) $ 391 $ (102 ) $ 786 Net income attributable to noncontrolling interests $ 6 $ - $ - $ - $ - $ 6 Net income (loss) attributable to WCR common shareholders $ 743 $ 73 $ (325 ) $ 391 $ (102 ) $ 780 Earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.078 $ 0.008 $ (0.034 ) $ 0.041 $ (0.011 ) $ 0.082 Three Months Ended September 30, 2015 Pro forma revenue $ 3,675 $ 9,537 $ 5,442 $ 3,297 $ - $ 21,951 % of total pro forma revenue 16.7 % 43.5 % 24.8 % 15.0 % -% 100.0 % Pro forma net income (loss) $ 829 $ 443 $ (569 ) $ 390 $ (167 ) $ 926 Pro forma net income attributable to noncontrolling interests $ 6 $ - $ - $ - $ - $ 6 Pro forma net income (loss) attributable to WCR common shareholders $ 823 $ 443 $ (569 ) $ 390 $ (167 ) $ 920 Pro forma earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.087 $ 0.047 $ (0.060 ) $ 0.041 $ (0.018 ) $ 0.097 Franchise Cellular Direct to Consumer Corporate Total Nine Months Ended September 30, 2016 Revenue $ 11,452 $ 27,152 $ 30,699 $ 8,830 $ - $ 78,133 % of total revenue 14.6 % 34.8 % 39.3 % 11.3 % -% 100.0 % Net income (loss) $ 1,834 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,551 Net income attributable to noncontrolling interests $ 15 $ - $ - $ - $ - $ 15 Net income (loss) attributable to WCR common shareholders $ 1,819 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,536 Earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.192 $ 0.055 $ 0.177 $ 0.102 $ (0.048 ) $ 0.478 Nine Months Ended September 30, 2015 Pro forma revenue $ 9,641 $ 29,632 $ 30,296 $ 9,451 $ - $ 79,020 % of total pro forma revenue 12.2 % 37.5 % 38.3 % 12.0 % -% 100.0 % Pro forma net income (loss) $ 1,585 $ 967 $ 1,365 $ 932 $ (408 ) $ 4,441 Pro forma net income attributable to noncontrolling interests $ 13 $ - $ - $ - $ - $ 13 Pro forma net income (loss) attributable to WCR common shareholders $ 1,572 $ 967 $ 1,365 $ 932 $ (408 ) $ 4,428 Pro forma earnings (loss) per share attributable to WCR common shareholders – basic and diluted $ 0.165 $ 0.102 $ 0.144 $ 0.098 $ (0.043 ) $ 0.466 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Schedule of segment information | Segment information related to the three and nine month periods ended September 30, 2016 and 2015 is presented below: Three Months Ended September 30, 2016 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 4,278 $ 9,294 $ 5,944 $ 3,009 $ - $ 22,525 Net income (loss) $ 749 $ 73 $ (325 ) $ 391 $ (102 ) $ 786 Expenditures for segmented assets $ 3 $ 241 $ 50 $ 21 $ - $ 315 Three Months Ended September 30, 2015 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 3,675 $ 9,537 $ 5,442 $ 3,297 $ - $ 21,951 Net income (loss) $ 829 $ 443 $ (569 ) $ 390 $ (213 ) $ 880 Expenditures for segmented assets $ - $ - $ 186 $ 29 $ - $ 215 Nine Months Ended September 30, 2016 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 11,452 $ 27,152 $ 30,699 $ 8,830 $ - $ 78,133 Net income (loss) $ 1,834 $ 526 $ 1,682 $ 964 $ (455 ) $ 4,551 Total segment assets $ 10,111 $ 16,472 $ 14,723 $ 15,735 $ 413 $ 57,454 Expenditures for segmented assets $ 19 $ 1,688 $ 89 $ 39 $ - $ 1,835 Nine Months Ended September 30, 2015 (in thousands) Franchise Cellular Direct to Consumer Corporate Total Revenue from external customers $ 9,641 $ 24,655 $ 5,442 $ 9,451 $ - $ 49,189 Net income (loss) $ 1,585 $ 910 $ (569 ) $ 932 $ (710 ) $ 2,148 Total segment assets $ 9,379 $ 12,823 $ 13,568 $ 16,299 $ 544 $ 52,613 Expenditures for segmented assets $ 91 $ 3,656 $ 186 $ 45 $ 14 $ 3,992 |
Basis of Presentation, Nature30
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies (Details Narrative) | 9 Months Ended |
Sep. 30, 2016USD ($)Number | |
Accounting Standards Update 2015-17 [Member] | |
Decrease in current deferred tax assets | $ | $ 560,000 |
Decrease in noncurrent deferred tax liabilities | $ | $ 560,000 |
JPPA [Member] | Direct to Consumer [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
RAI [Member] | Direct to Consumer [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
JPRE [Member] | Direct to Consumer [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
Alpha Graphics, Inc. [Member] | Franchising [Member] | |
Number of domestic business centers | Number | 258 |
Number of international business centers | Number | 25 |
Percentage of equity method investment | 99.20% |
PQH Wireless, Inc. [Member] | Cellular Retail [Member] | |
Number of stores | Number | 126 |
Percentage of equity method investment | 100.00% |
Wyoming Financial Lenders, Inc. [Member] | Consumer Finance [Member] | |
Number of stores | Number | 45 |
Percentage of equity method investment | 100.00% |
Number of states in which entity operates | Number | 8 |
Wyoming Financial Lenders, Inc. [Member] | Payday [Member] | Minimum [Member] | Consumer Finance [Member] | |
Non-recourse debt | $ | $ 100 |
Wyoming Financial Lenders, Inc. [Member] | Payday [Member] | Maximum [Member] | Consumer Finance [Member] | |
Non-recourse debt | $ | 500 |
Wyoming Financial Lenders, Inc. [Member] | Installment [Member] | Minimum [Member] | Consumer Finance [Member] | |
Non-recourse debt | $ | 300 |
Wyoming Financial Lenders, Inc. [Member] | Installment [Member] | Maximum [Member] | Consumer Finance [Member] | |
Non-recourse debt | $ | $ 800 |
Express Pawn, Inc. [Member] | Consumer Finance [Member] | |
Number of stores | Number | 3 |
Percentage of equity method investment | 100.00% |
Loans Receivable (Details)
Loans Receivable (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | $ 5,404,062 | $ 6,061,438 |
Less Allowance | (993,000) | (1,177,000) |
Notes, Loans and Financing Receivable, Net, current | 4,411,062 | 4,884,438 |
151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 131,523 | 167,426 |
91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 160,407 | 205,540 |
Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 4,176,572 | 4,644,167 |
1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 336,504 | 375,396 |
31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 273,831 | 287,719 |
61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 190,541 | 215,819 |
121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 134,684 | 165,371 |
Payday and Title Loans [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 4,771,877 | 5,382,681 |
Less Allowance | (920,000) | (1,081,000) |
Notes, Loans and Financing Receivable, Net, current | 3,851,877 | 4,301,681 |
Payday and Title Loans [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 129,724 | 165,237 |
Payday and Title Loans [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 150,320 | 196,123 |
Payday and Title Loans [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 3,645,540 | 4,065,706 |
Payday and Title Loans [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 290,044 | 332,217 |
Payday and Title Loans [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 249,995 | 263,486 |
Payday and Title Loans [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 175,254 | 199,526 |
Payday and Title Loans [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 131,000 | 160,386 |
Installment Loans [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 349,973 | 392,243 |
Less Allowance | (73,000) | (96,000) |
Notes, Loans and Financing Receivable, Net, current | 276,973 | 296,243 |
Installment Loans [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 1,799 | 2,189 |
Installment Loans [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 10,087 | 9,417 |
Installment Loans [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 248,820 | 291,947 |
Installment Loans [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 46,460 | 43,179 |
Installment Loans [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 23,836 | 24,233 |
Installment Loans [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 15,287 | 16,293 |
Installment Loans [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 3,684 | 4,985 |
Pawn Title [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 282,212 | 286,514 |
Less Allowance | ||
Notes, Loans and Financing Receivable, Net, current | 282,212 | 286,514 |
Pawn Title [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 282,212 | 286,514 |
Pawn Title [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current |
Loans Receivable Allowance (Det
Loans Receivable Allowance (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Allowance for Loan and Lease Losses [Roll Forward] | ||
Loans receivable allowance, beginning of period | $ 1,177,000 | $ 1,219,000 |
Provision for loan losses charged to expense | 1,176,174 | 1,904,893 |
Charge-offs, net | (1,360,174) | (1,946,893) |
Loans receivable allowance, end of period | $ 993,000 | $ 1,177,000 |
Loans Receivable Allowance (D33
Loans Receivable Allowance (Details Narrative) | Sep. 30, 2016 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 43.00% |
1 To 30 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 43.00% |
31 to 60 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 65.00% |
61 To 90 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 83.00% |
91 To 120 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 89.00% |
121 To 150 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 91.00% |
151 To 180 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 93.00% |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Accounts receivable | $ 2,426,911 | $ 2,235,192 |
Less allowance | (166,000) | (272,000) |
Net account receivable | 2,260,911 | 1,963,192 |
Direct to Consumer [Member] | ||
Accounts receivable | 619,568 | 754,400 |
Less allowance | (17,000) | (89,000) |
Net account receivable | 602,568 | 665,400 |
Franchise [Member] | ||
Accounts receivable | 1,624,351 | 1,332,446 |
Less allowance | (149,000) | (183,000) |
Net account receivable | 1,475,351 | 1,149,446 |
Cellular Retail [Member] | ||
Accounts receivable | 172,813 | 148,346 |
Less allowance | ||
Net account receivable | 172,813 | 148,346 |
Consumer Finance [Member] | ||
Accounts receivable | 10,179 | |
Less allowance | ||
Net account receivable | $ 10,179 |
Deferred Revenue and Other Li35
Deferred Revenue and Other Liabilities (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Deferred Revenue Disclosure [Abstract] | ||
Deferred financing fees | $ 265,779 | $ 285,452 |
Deferred franchise development and service fees | 130,500 | 264,000 |
Merchandise credits and gift card liability | 694,302 | 1,127,470 |
Other | 135,561 | 119,416 |
Total | $ 1,226,142 | $ 1,796,338 |
Notes Payable - Long Term (Deta
Notes Payable - Long Term (Details) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Instrument [Line Items] | ||
Total | $ 7,876,829 | $ 7,996,460 |
Less current maturities | (1,100,000) | (4,900,008) |
Notes payable, noncurrent | 6,776,829 | 3,096,452 |
Note Payable To Financial Institution [Member] | ||
Debt Instrument [Line Items] | ||
Total | 1,625,000 | |
Note Payable To River City Equity, Inc. [Member] | ||
Debt Instrument [Line Items] | ||
Total | 3,000,000 | |
Note Payable To Financial Institution Four [Member] | ||
Debt Instrument [Line Items] | ||
Total | 3,266,667 | |
Revolving Credit Facility To Financial Institution [Member] | ||
Debt Instrument [Line Items] | ||
Total | 1,538,708 | |
Note Payable To Financial Institution Two [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 3,071,454 | $ 3,371,460 |
Notes Payable - Long Term (De37
Notes Payable - Long Term (Details 1) - USD ($) | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
Year 1 | $ 1,100,000 | |
Year 2 | 2,638,716 | |
Year 3 | 2,971,446 | |
Year 4 | 700,000 | |
Year 5 | 466,667 | |
Thereafter | ||
Long-term debt | $ 7,876,829 | $ 7,996,460 |
Notes Payable - Long Term (De38
Notes Payable - Long Term (Details Narrative) - USD ($) | Apr. 22, 2016 | Sep. 30, 2016 |
Long Term Note Payable General [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | Apr. 21, 2018 | |
Maximum borrowing capacity | $ 9,000,000 | |
Credit available capacity | $ 7,195,000 | |
Description of variable rate | The revolver and the acquisition loan facility bear interest at a floating per annum rate equal to one-month LIBOR plus 3.50%, adjusted on a monthly basis. Funds advanced under the acquisition loan facility mature five years from the date of advance. | |
Equity debt | 3,000,000 | |
Other term debt | 500,000 | |
Total repacement acquisition loan | $ 3,500,000 | |
Revolving Credit Facility To Financial Institution [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | Apr. 21, 2018 | |
Maximum borrowing capacity | $ 3,000,000 | |
Description of variable rate | LIBOR plus 3.5% (4.125% at September 30, 2016) | |
Note Payable To Financial Institution Two [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | Jun. 5, 2019 | |
Principal periodic payment | $ 33,334 | |
Description of variable rate | LIBOR plus 3.5% (4% at June 30, 2016) | |
Note Payable To Financial Institution Four [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | Apr. 21, 2021 | |
Principal periodic payment | $ 58,333 | |
Description of variable rate | LIBOR plus 3.5% (4.125% at September 30, 2016) | |
Note Payable To Financial Institution [Member] | ||
Debt Instrument [Line Items] | ||
Termination date | 2016-05 | |
Principal periodic payment | $ 375,000 | |
Description of maturity date | March 2,017 | |
Description of variable rate | Prime rate plus 2.5% | |
Note Payable To River City Equity, Inc. [Member] | ||
Debt Instrument [Line Items] | ||
Maturity date | Jun. 30, 2016 | |
Termination date | 2016-05 | |
Stated interest rate | 12.00% |
Cash Dividends (Details)
Cash Dividends (Details) | 9 Months Ended |
Sep. 30, 2016$ / shares | |
Dividends One [Member] | |
Date declared | Aug. 11, 2016 |
Record date | Sep. 14, 2016 |
Date paid | Sep. 21, 2016 |
Dividend per share of common stock (in dollars per share) | $ 0.025 |
Dividends [Member] | |
Date declared | May 24, 2016 |
Record date | Jun. 6, 2016 |
Date paid | Jun. 15, 2016 |
Dividend per share of common stock (in dollars per share) | $ 0.025 |
Other Operating Expense (Detail
Other Operating Expense (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Other Income and Expenses [Abstract] | ||||
Bank fees | $ 337,939 | $ 310,419 | $ 1,273,057 | $ 595,164 |
Collection costs | 85,306 | 99,587 | 311,457 | 319,890 |
Conference expense | 468,124 | 460,602 | 762,680 | 671,287 |
Insurance | 184,106 | 110,788 | 528,995 | 286,783 |
Management and advisory fees | 195,425 | 125,754 | 619,954 | 400,057 |
Professional and consulting fees | 488,978 | 483,575 | 1,531,923 | 1,401,683 |
Supplies | 231,995 | 167,480 | 591,919 | 496,116 |
Other | 803,453 | 522,604 | 2,429,596 | 1,583,539 |
Total other expenses | $ 2,795,326 | $ 2,280,809 | $ 8,049,581 | $ 5,754,519 |
Pro Forma Information (Details)
Pro Forma Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenue | $ 22,525 | $ 21,951 | $ 78,133 | $ 79,020 |
% of total revenue | 100.00% | 100.00% | 100.00% | 100.00% |
Net income (loss) | $ 786 | $ 926 | $ 4,551 | $ 4,441 |
Net income attributable to noncontrolling interests | 6 | 6 | 15 | 13 |
Net income (loss) attributable to WCR common shareholders | $ 780 | $ 920 | $ 4,536 | $ 4,428 |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ 0.082 | $ 0.097 | $ 0.478 | $ 0.466 |
Consumer Finance [Member] | ||||
Revenue | $ 3,009 | $ 3,297 | $ 8,830 | $ 9,451 |
% of total revenue | 13.40% | 15.00% | 11.30% | 12.00% |
Net income (loss) | $ 391 | $ 390 | $ 964 | $ 932 |
Net income attributable to noncontrolling interests | ||||
Net income (loss) attributable to WCR common shareholders | $ 391 | $ 390 | $ 964 | $ 932 |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ 0.041 | $ 0.041 | $ 0.102 | $ 0.098 |
Direct to Consumer [Member] | ||||
Revenue | $ 5,944 | $ 5,442 | $ 30,699 | $ 30,296 |
% of total revenue | 26.40% | 24.80% | 39.30% | 38.30% |
Net income (loss) | $ (325) | $ (569) | $ 1,682 | $ 1,365 |
Net income attributable to noncontrolling interests | ||||
Net income (loss) attributable to WCR common shareholders | $ (325) | $ (569) | $ 1,682 | $ 1,365 |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ (0.034) | $ (0.060) | $ 0.177 | $ 0.144 |
Franchise [Member] | ||||
Revenue | $ 4,278 | $ 3,675 | $ 11,452 | $ 9,641 |
% of total revenue | 19.00% | 16.70% | 14.60% | 12.20% |
Net income (loss) | $ 749 | $ 829 | $ 1,834 | $ 1,585 |
Net income attributable to noncontrolling interests | 6 | 6 | 15 | 13 |
Net income (loss) attributable to WCR common shareholders | $ 743 | $ 823 | $ 1,819 | $ 1,572 |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ 0.078 | $ 0.087 | $ 0.192 | $ 0.165 |
Cellular Retail [Member] | ||||
Revenue | $ 9,294 | $ 9,537 | $ 27,152 | $ 29,632 |
% of total revenue | 41.20% | 43.50% | 34.80% | 37.50% |
Net income (loss) | $ 73 | $ 443 | $ 526 | $ 967 |
Net income attributable to noncontrolling interests | ||||
Net income (loss) attributable to WCR common shareholders | $ 73 | $ 443 | $ 526 | $ 967 |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ 0.008 | $ 0.047 | $ 0.055 | $ 0.102 |
Corporate [Member] | ||||
Revenue | ||||
% of total revenue | ||||
Net income (loss) | $ (102) | $ (167) | $ (455) | $ (408) |
Net income attributable to noncontrolling interests | ||||
Net income (loss) attributable to WCR common shareholders | $ (102) | $ (167) | $ (455) | $ (408) |
Earnings (loss) per share attributable to WCR common shareholders - basic and diluted | $ (0.011) | $ (0.018) | $ (0.048) | $ (0.043) |
Pro Forma Information (Details
Pro Forma Information (Details Narrative) | Jun. 01, 2015 |
JPPA, RAI And JPRE Transaction [Member] | Common Stock [Member] | |
Percentage of voting rights issued as percent of post acquisition voting rights | 100.00% |
Segment Information (Details)
Segment Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | $ 22,525,467 | $ 21,951,468 | $ 78,133,179 | $ 49,189,252 | ||
Net income (loss) | 786,357 | 880,101 | 4,551,005 | 2,147,944 | ||
Total segment assets | 57,454,002 | 52,613,000 | 57,454,002 | 52,613,000 | $ 57,454,000 | $ 55,622,333 |
Expenditures for segmented assets | 315,000 | 215,000 | 1,835,000 | 3,992,000 | ||
Direct to Consumer [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | 5,944,000 | 5,442,000 | 30,699,000 | 5,442,000 | ||
Net income (loss) | (325,000) | (569,000) | 1,682,000 | (569,000) | ||
Total segment assets | 14,723,000 | 13,568,000 | 14,723,000 | 13,568,000 | ||
Expenditures for segmented assets | 50,000 | 186,000 | 89,000 | 186,000 | ||
Franchise [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | 4,278,000 | 3,675,000 | 11,452,000 | 9,641,000 | ||
Net income (loss) | 749,000 | 829,000 | 1,834,000 | 1,585,000 | ||
Total segment assets | 10,111,000 | 9,379,000 | 10,111,000 | 9,379,000 | ||
Expenditures for segmented assets | 3,000 | 19,000 | 91,000 | |||
Cellular Retail [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | 9,294,000 | 9,537,000 | 27,152,000 | 24,655,000 | ||
Net income (loss) | 73,000 | 443,000 | 526,000 | 910,000 | ||
Total segment assets | 16,472,000 | 12,823,000 | 16,472,000 | 12,823,000 | ||
Expenditures for segmented assets | 241,000 | 1,688,000 | 3,656,000 | |||
Consumer Finance [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | 3,009,000 | 3,297,000 | 8,830,000 | 9,451,000 | ||
Net income (loss) | 391,000 | 390,000 | 964,000 | 932,000 | ||
Total segment assets | 15,735,000 | 16,299,000 | 15,735,000 | 16,299,000 | ||
Expenditures for segmented assets | 21,000 | 29,000 | 39,000 | 45,000 | ||
Corporate [Member] | ||||||
Segment Reporting Information [Line Items] | ||||||
Revenue from external customers | ||||||
Net income (loss) | (102,000) | (213,000) | (455,000) | (710,000) | ||
Total segment assets | 413,000 | 544,000 | 413,000 | 544,000 | ||
Expenditures for segmented assets | $ 14,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Jun. 06, 2016 | Apr. 22, 2016 | Sep. 30, 2016 | Sep. 30, 2016 |
Employment Agreement [Member] | ||||
Amount of bonus | $ 390,000 | $ 1,083,000 | ||
Mr. John Quandahl [Member] | Employment Agreement [Member] | ||||
Extend the term of the agreement | 2019-03 | |||
Revolving Credit Facility [Member] | Credit Agreement [Member] | ||||
Description of debt instrument collateral | All borrowings under the Credit Agreement are secured by substantially all assets of WCR and the guarantor subsidiaries. | |||
Description of debt instrument covenant | The Credit Agreement requires WCR to meet certain financial tests, including a leverage ratio and a fixed charge coverage ratio, as defined in the Credit Agreement. Subject to certain exceptions, the Credit Agreement contains covenants limiting the company’s ability to (or to permit the guarantor subsidiaries to) merge or consolidate with, or engage in a sale of substantially all assets to, any party, but WCR or any guarantor subsidiary generally may nonetheless merge with another party if (i) WCR or guarantor subsidiary is the entity surviving such merger, and (ii) immediately after giving effect to such merger, no default shall have occurred and be continuing under the Credit Agreement. Subject to certain exceptions, the Credit Agreement also contains covenants limiting WCR’s ability to (or to permit the guarantor subsidiaries to) create liens on assets, incur additional indebtedness, make certain types of investments, and pay dividends or make certain other types of restricted payments, but WCR may nonetheless pay dividends to its shareholders if (a) there are no outstanding loans or unpaid interest under the revolving credit facility, and (b) no default shall have occurred and be continuing under the Credit Agreement. | |||
PQH Wireless, Inc. [Member] | Cellular Retail Growth Commitment [Member] | ||||
Description of retail business expansion | Open at least 150 locations by December 31, 2017, including 50 locations by December 31, 2016. |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Asset Purchase Agreement [Member] - Wireless Retail Transaction [Member] | 1 Months Ended |
Nov. 30, 2016USD ($)Number | |
Number of location store acquired | 20 |
Purchase price | $ | $ 2,050,000 |
Number of additional location store acquired | 33 |
Additional location store acquired purchase price | $ | $ 7,200,000 |
Percentage of ownership retain | 30.00% |
Total number of location store acquired | 53 |