Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 14, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | Regional Brands Inc. | |
Entity Central Index Key | 812,149 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | RGBD | |
Entity Common Stock, Shares Outstanding | 1,274,603 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents | $ 4,347,665 | $ 4,353,567 |
Short-term investments | 2,264,718 | 1,967,145 |
Accounts receivable, net of allowance for doubtful accounts | 8,602,045 | 6,557,158 |
Inventories, net | 1,516,018 | 1,242,723 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 1,439,404 | 1,087,218 |
Prepaid expenses and other current assets | 509,263 | 447,539 |
Total current assets | 18,679,113 | 15,655,350 |
Equipment, net | 933,005 | 572,568 |
Intangibles, net | 4,068,265 | 4,600,000 |
Goodwill | 3,013,287 | 3,013,287 |
Deferred income taxes | 330,465 | 288,791 |
Other assets | 197,177 | 144,729 |
Total assets | 27,221,312 | 24,274,725 |
Current Liabilities: | ||
Accounts payable | 2,406,155 | 1,357,647 |
Accrued expenses and other current liabilities | 854,082 | 1,081,868 |
Line of credit | 2,931,526 | 1,812,454 |
Current portion of senior subordinated note | 23,900 | 23,900 |
Current portion of subordinated term note | 187,500 | 62,500 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 618,924 | 192,710 |
Total current liabilities | 7,022,087 | 4,531,079 |
Senior subordinated note, net | 236,636 | 224,063 |
Subordinated term note | 2,312,500 | 2,437,500 |
Total liabilities | 9,571,223 | 7,192,642 |
Stockholders' equity: | ||
Preferred stock $.01 par value, authorized 50,000, issued and outstanding -none | 0 | 0 |
Common stock $.00001 par value, 3,000,000 authorized and 1,274,603 shares issued and outstanding | 13 | 13 |
Additional paid-in capital | 20,401,177 | 20,373,257 |
Accumulated deficit | (2,641,864) | (3,203,781) |
Total Regional Brands, Inc. stockholders' equity | 17,759,326 | 17,169,489 |
Noncontrolling interest in consolidated subsidiary | (109,237) | (87,406) |
Total stockholders' equity | 17,650,089 | 17,082,083 |
Total liabilities and stockholders' equity | $ 27,221,312 | $ 24,274,725 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000 | 50,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 3,000,000 | 3,000,000 |
Common stock, shares issued | 1,274,603 | 1,274,603 |
Common stock, shares, outstanding | 1,274,603 | 1,274,603 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Net Sales | $ 11,920,846 | $ 11,151,952 | $ 20,083,630 | $ 19,898,301 |
Cost of sales | 8,566,194 | 7,723,645 | 14,469,936 | 13,974,339 |
Gross profit | 3,354,652 | 3,428,307 | 5,613,694 | 5,923,962 |
Operating expenses: | ||||
Selling | 1,198,474 | 1,221,981 | 2,264,187 | 2,321,745 |
General and administrative | 1,039,350 | 1,026,463 | 1,991,062 | 1,969,326 |
Amortization of intangible assets | 311,735 | 429,167 | 611,735 | 1,116,667 |
Total operating expenses | 2,549,559 | 2,677,611 | 4,866,984 | 5,407,738 |
Operating income | 805,093 | 750,696 | 746,710 | 516,224 |
Other income (expense): | ||||
Other income | 85,900 | 23,007 | 119,579 | 39,157 |
Interest expense | (64,048) | (58,479) | (114,697) | (119,433) |
Interest income | 6,345 | 818 | 12,486 | 4,365 |
Other income/(expense) | 28,197 | (34,654) | 17,368 | (75,911) |
Income before income taxes | 833,290 | 716,042 | 764,078 | 440,313 |
Income tax provision | 191,633 | 360,800 | 173,912 | 414,000 |
Net income | 641,657 | 355,242 | 590,166 | 26,313 |
Less income to noncontrolling interest | 34,934 | 32,663 | 28,249 | 18,697 |
Income attributable to common shareholders | $ 606,723 | $ 322,579 | $ 561,917 | $ 7,616 |
Income (loss) per common share- basic and diluted (restated for the 2017 periods) | $ 0.44 | $ 0.23 | $ 0.40 | $ (0.01) |
Weighted average common shares outstanding - basic and diluted | 1,274,603 | 1,274,603 | 1,274,603 | 1,274,603 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 590,166 | $ 26,313 |
Adjustments to reconcile net loss to net cash (used) provided by operating activities: | ||
Stock based compensation | 27,920 | 31,000 |
Depreciation and amortization | 78,963 | 54,872 |
Amortization of debt issuance costs | 12,573 | 12,573 |
Amortization of intangibles | 611,735 | 1,116,667 |
Deferred income taxes | (41,674) | 0 |
Unrealized (gain) loss on investments | (63,271) | 1,476 |
Change in allowance for doubtful accounts | 0 | (50,000) |
Change in inventory obsolescence reserve | 6,500 | 50,000 |
Changes in operating assets and liabilities | ||
Accounts receivable | (2,044,887) | (572,627) |
Inventories | (279,795) | 162,655 |
Costs and estimated earnings in excess of billings on uncompleted contracts | (352,186) | (424,145) |
Prepaid expenses and other assets | (114,347) | (187,735) |
Accounts payable | 1,048,508 | 1,056,973 |
Accrued expenses and other current liabilities | (274,721) | 509,031 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 426,214 | (204,043) |
Net cash (used) provided by operating activities | (368,302) | 1,583,010 |
Cash flows from investment activities: | ||
Purchase of equipment | (344,225) | (73,884) |
Business acquisitions | (200,000) | (1,107,872) |
Equipment sales proceeds | 25,000 | 0 |
Purchase of short- term investments | (234,302) | (751,714) |
Net cash used by investment activities | (753,527) | (1,933,470) |
Cash flows from financing activities: | ||
Distribution to noncontrolling shareholder | (3,145) | (37,173) |
Borrowings from line of credit | 1,119,072 | (197,839) |
Net cash provided (used) by financing activities | 1,115,927 | (235,012) |
Net decrease in cash | (5,902) | (585,472) |
Cash at beginning of period | 4,353,567 | 4,752,462 |
Cash at end of period | 4,347,665 | 4,166,990 |
Cash paid for: | ||
Income taxes | 625 | 169,000 |
Interest | 114,500 | 107,000 |
Noncash Transactions: | ||
Accrued distribution to noncontrolling shareholder | $ 46,935 | $ 0 |
NATURE OF BUSINESS AND SUMMARY
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Regional Brands Inc. (formerly 4net Software, Inc.) (“Regional Brands,” the “Company,” “we,” “our” and “us”) was incorporated under the laws of the State of Delaware in 1986. Regional Brands is a holding company formed to acquire substantial ownership in regional companies with strong brand recognition, stable revenues and profitability. Regional Brands has been pursuing a business strategy whereby it seeks to engage in an acquisition, merger or other business combination transaction with undervalued businesses (each, a “Target Company”) with a history of operating revenues in markets that provide opportunities for growth. On November 1, 2016 the Company's majority-owned subsidiary acquired substantially all of the assets (the “Acquisition”) of B.R. Johnson, Inc. (“BRJ Inc.”), a seller and distributor of windows, doors and related hardware as well as specialty products for use in commercial and residential buildings. After the acquisition of the business of BRJ Inc. by our majority-owned subsidiary, B.R. Johnson, LLC (“BRJ LLC”), we are currently focused on considering opportunities for growth of BRJ LLC through utilizing its balance sheet to provide capital for additional acquisitions of companies that would be complementary to BRJ LLC. Additionally, we may seek to acquire Target Companies that satisfy the following criteria: (1) established businesses with viable services or products; (2) an experienced and qualified management team; (3) opportunities for growth and/or expansion into other markets; (4) are accretive to earnings; (5) offer the opportunity to achieve and/or enhance profitability; and (6) increase shareholder value. Basis of Presentation - Restatement of Income Per Common Share The effect of the restatement on the applicable 2017 periods is as follows: Income (loss) per common share Year Ended Nine Months Ended Six Months Ended Three Months Ended - basic and diluted December 31, 2017 September 30, 2017 June 30, 2017 September 30, 2017 June 30, 2017 As originally reported $ 0.63 $ 0.56 $ 0.01 $ 0.56 $ 0.25 Adjustment $ (0.15 ) $ (0.08 ) $ (0.02 ) $ (0.06 ) $ (0.02 ) As adjusted $ 0.48 $ 0.48 $ (0.01 ) $ 0.50 $ 0.23 A reconciliation of income attributable to common shareholders to the amounts used to calculate Income (loss) available to common shareholders is as follows: Income attributable to common shareholders $ 810,124 $ 718,431 $ 7,616 $ 710,815 $ 322,579 Distributions to certain noncontrolling interests $ (197,016 ) $ (99,346 ) $ (27,228 ) $ (72,118 ) $ (27,228 ) Income (loss) available to common shareholders $ 613,108 $ 619,085 $ (19,612 ) $ 638,697 $ 295,351 Principles of Consolidation Use of Estimates Inventories Common Shares Issued and Earnings (Loss) Per Share A reconciliation of income attributable to common shareholders and the amount used in the income per share calculations is as follows: Three Months Ended Six Months Ended June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 Income ommon shareholders $ 606,723 $ 322,579 $ 561,917 $ 7,616 Distributions to certain noncontrolling interests $ (46,935 ) $ (27,228 ) $ (46,935 ) $ (27,228 ) Income (loss) available to common shareholders $ 559,788 $ 295,351 $ 514,982 $ (19,612 ) Weighted average common shares outstanding- basic and diluted 1,274,603 1,274,603 1,274,603 1,274,603 Income (loss) per common share-basic and diluted $ 0.44 $ 0.23 $ 0.40 $ (0.01 ) Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurement Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: · Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; · Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and · Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The Company’s valuation techniques used to measure the fair value of money market funds, certificate of deposits, and certain marketable equity securities were derived from quoted prices in active markets for identical assets or liabilities. In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option for any eligible financial instruments. Our short-term investments consist of investments in marketable equity related securities and money market funds. All of these marketable securities are accounted for as available-for-sale securities, which are carried at fair value using quoted market prices in active markets for each marketable security. Prior to 2018, any unrealized gains or losses on these securities were recognized through other comprehensive income (loss). Beginning on January 1, 2018 with the adoption of Accounting Standards Update ("ASU") 2016-01, all of our marketable equity securities and money market funds will continue to be carried at fair value as noted above, with any unrealized gains or losses on the securities recognized as a component of other income included on our Condensed Consolidated Statements of Income. As a result of the adoption of ASU 2016-01, the accumulated deficit for the year ended December 31, 2017 was increased by $1,504 and the net income for the six months ended June 30, 2017 was decreased by $1,476. The tables below present the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 aggregated by the level in the fair value hierarchy within which those measurements fall. Assets Level 1 Level 2 Level 3 Balance at June 30, 2018 Marketable Equity Securities $ 2,264,718 $ — $ — $ 2,264,718 Money Market Funds $ 4,347,665 $ — $ — $ 4,347,665 Assets Level 1 Level 2 Level 3 Balance at December 31, 2017 Marketable Equity Securities $ 1,967,145 $ — $ — $ 1,967,145 Money Market Funds $ 4,353,567 $ — $ — $ 4,353,567 Recent Accounting Pronouncements In February 2016, the FASB issued an accounting standard update ASU 2016-02, “Leases" to replace existing lease accounting guidance. This pronouncement is intended to provide enhanced transparency and comparability by requiring lessees to record right-of-use assets and corresponding lease liabilities on the balance sheet for most leases. Expenses associated with leases will continue to be recognized in a manner similar to current accounting guidance. This pronouncement is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The adoption is required to be applied on a modified retrospective basis for each prior reporting period presented. The Company has not yet determined the effect that the adoption of this pronouncement may have on its financial position and/or results of operations. In August 2016, the FASB issued Accounting Standards Update 2016-15, “Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments”. The standard makes eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. The standard is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The new standard requires adoption on a retrospective basis unless it is impracticable to apply, in which case the Company would be required to apply the amendments prospectively as of the earliest date practicable. The Company has adopted this standard effective January 1, 2018. Adoption of this standard did not impact our Consolidated Financial Statements for the current or prior periods presented. In May 2017, the FASB issued Accounting Standards Update 2017-09, “Compensation – Stock Compensation (Topic 718) – Scope of Modification Accounting”, which provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The standard is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. The standard is to be applied on a prospective basis to an award modified on or after the adoption date. The Company has adopted this standard effective January 1, 2018. Adoption of this standard did not impact our Consolidated Financial Statements. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of revenue recognition [Abstract] | |
Revenue recognition [Text Block] | NOTE 2. REVENUE RECOGNITION Effective January 1, 2018, we recognize revenue in accordance with ASC Topic 606 when the following criteria are met: 1) Contract with the customer has been identified; 2) Performance obligations in the contract have been identified; 3) Transaction price has been determined; 4) The transaction price has been allocated to the performance obligations; and 5) Revenue is recognized when (or as) performance obligations are satisfied. A portion of our revenue is derived from long-term contracts and is recognized using the percentage of completion (“POC”) method, primarily based on the percentage that actual costs-to-date bear to total estimated costs to complete each contract. We utilize the cost-to-cost approach to estimate POC as we believe this method is less subjective than relying on assessments of physical progress. Under the cost-to-cost approach, the use of estimated costs to complete each contract is a significant variable in the process of determining recognized revenue and is a significant factor in the accounting for contracts. Significant estimates that impact the cost to complete each contract are costs of materials, components, equipment, labor and subcontracts; labor productivity; schedule durations, including subcontractor or supplier progress; liquidated damages; contract disputes, including claims; achievement of contractual performance requirements; and contingency, among others. This business is related to the distribution and installation of commercial windows and specialty products which are supported by specific written contracts which include contract price, scope, payments terms and are signed by both parties. Our contract price is fixed for the scope of work specified and we generally have no variable consideration. We frequently negotiate change orders for additional work to be performed which typically relate to the initial performance obligation. Our customer payment terms are typical for our industry. For most contracts under the POC method, progress payments, less retainage, are made shortly after the contractor receives payment from the owner. For the remainder of our business, standard terms are that amounts are due 30 days after invoice date. For this business, we have determined that we have one performance obligation due to the high degree of inter-dependability and highly integrated nature of the work. Performance obligations for the remainder of our business are generally supported by written contracts or purchase orders which require the delivery of goods or services and the revenue is recognized upon shipment of those goods or performance of the service. The majority of our performance obligations are typically completed within one year. The following table presents our revenues disaggregated by contracts accounted for using the percentage of completion method. Sales and usage taxes are excluded from revenues: Quarter Ended June 30, 2018 2017 Contracts under percentage of completion $ 6,584,736 $ 7,356,193 All other 5,336,110 3,795,759 Total revenue $ 11,920,846 $ 11,151,952 Six Months Ended June 30, 2018 2017 Contracts under percentage of completion $ 10,885,302 $ 12,043,619 All other 9,198,328 7,854,682 Total revenue $ 20,083,630 $ 19,898,301 Remaining performance obligations represent the transaction price of firm orders for which work has not been performed. As of June 30, 2018, the aggregate amounts of the transaction prices allocated to the remaining performance obligations, for contracts to be recognized using the percentage of completion method, were $14.7 million. We have elected the practical expedients for not adjusting the promised amount of consideration for the effects of financing components when, at contract inception, the period between the transfer of good or service and when the customer pays is expected to be less than one year and for recognizing incremental costs of obtaining a contract as incurred as they would otherwise have been amortized over one year or less. We have made an accounting policy election to treat any common carrier shipping and handling activities as a fulfillment cost, rather than a separate obligation or promised service. |
CONTRACT ASSETS AND LIABILITIES
CONTRACT ASSETS AND LIABILITIES | 6 Months Ended |
Jun. 30, 2018 | |
Contractors [Abstract] | |
Contract assets and liabilities [Text Block] | NOTE 3. CONTRACT ASSETS AND LIABILITIES Cost of revenue for our long-term contracts includes direct contract costs, such as materials and labor, and indirect costs that are attributable to contract activity. The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Projects with costs and estimated earnings recognized to date in excess of cumulative billings is reported on the accompanying balance sheet as an asset as costs and estimated earnings in excess of billings. Projects with cumulative billings in excess of costs and estimated earnings recognized to date is reported on the accompanying balance sheet as a liability as billings in excess of costs and estimated earnings. The following is information with respect to uncompleted contracts: June 30, 2018 December 31, 2017 Costs incurred on uncompleted contracts $ 9,800,255 $ 8,404,168 Estimated earnings 2,832,693 3,695,967 12,632,948 12,100,135 Less billings to date 11,812,468 11,205,627 $ 820,480 $ 894,508 Included on balance sheet as follows: Under current assets Costs and estimated earnings in excess of billings on uncompleted contracts $ 1,439,404 $ 1,087,218 Under current liabilities Billings in excess of costs and estimated earnings on uncompleted contracts $ (618,924 ) $ (192,710 ) $ 820,480 $ 894,508 The Company had unbilled revenues of $1,219,379 and $1,043,082 at the end of June 30, 2018 and December 31, 2017, respectively, which are included in Cost and estimated earnings in excess of billings on the balance sheet. |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 4. DEBT In November 2016, BRJ LLC entered into a credit agreement with KeyBank, N.A. Under the credit agreement, BRJ LLC may borrow up to an aggregate amount of $6,000,000 (the “Credit Facility”) under revolving loans and letters of credit, with a sublimit of $500,000 for letters of credit. The Credit Facility is payable upon demand of KeyBank, N.A., or the lenders, or upon acceleration as a result of an event of default. At the closing of the Acquisition, approximately $1,900,000 was drawn under the Credit Facility to pay a portion of the purchase price and costs associated with the Acquisition, with the balance being available for general working capital of BRJ LLC. Interest under the Credit Facility is payable monthly and accrues pursuant to the “base rate” of interest, which is equal to the highest of (a) KeyBank, N.A.’s prime rate, (b) one-half of one percent (0.50%) in excess of the Federal Funds Effective Rate of the Federal Reserve Bank of New York, and (c) one hundred (100) basis points in excess of the London Interbank Offered Rate for loans in Eurodollars with an interest period of one month, plus any applicable margin. The credit agreement also requires the payment of certain fees, including, but not limited to, letter of credit fees. The Credit Facility is secured by substantially all of BRJ LLC’s assets. The Credit Facility contains customary financial and other covenant requirements, including, but not limited to, a covenant to not permit BRJ LLC’s consolidated fixed charge coverage ratio to exceed 1.15 to 1.00. The Credit Facility also contains customary events of default. For the six months ended June 30, 2018, the Company was in compliance with these covenants. The effective interest rate on borrowings under the Credit Facility at June 30, 2018 was 3.69%. The aggregate borrowings outstanding under the Credit Facility at June 30, 2018 were $2,931,526. In addition, the bank has issued a letter of credit on behalf of the Company in the amount of $250,000 that expires on December 1, 2018. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | NOTE 5. STOCKHOLDERS’ EQUITY The Company’s authorized capital consists of 3,000,000 shares of common stock, par value $0.00001 per share, and 50,000 shares of preferred stock, par value $0.01 per share. On March 2, 2017, the Company filed a certificate of amendment (the “Amendment”) to the Company’s Certificate of Incorporation with the Delaware Secretary of State to reduce the number of shares of Common Stock the Company is authorized to issue from 50,000,000 to 3,000,000 shares and to reduce the number of shares of Preferred Stock the Company is authorized to issue from 5,000,000 to 50,000 shares. The Amendment was approved by the Board of Directors of the Company and the holders of a majority of the issued and outstanding shares of Common Stock by written consent in lieu of a meeting. The Company recorded stock compensation expense for options vesting during the three month periods ended June 30, 2018 and 2017 of $13,878 and $15,397, respectively, and during the six month periods ended June 30, 2018 and 2017 of $27,920 and $31,000, respectively. On June 15, 2017, the Company’s stockholders approved and adopted the Company’s Amended and Restated 2016 Equity Incentive Plan (the “Amended and Restated Equity Incentive Plan”). The amendment modified the Company’s 2016 Equity Incentive Plan to, among other things, (1) provide the Board of Directors with the authority to grant awards in the form of restricted stock and restricted stock units, (2) set the maximum number of shares available for issuance under the Amended and Restated Equity Incentive Plan at 130,000 shares of the Company’s common stock, par value $0.00001 per share, and (3) adopt certain other technical amendments. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 6. RELATED PARTY TRANSACTIONS On April 8, 2016, the Company entered into a Management Services Agreement (the “MSA”) with Ancora Advisors, LLC, whereby Ancora Advisors, LLC agreed to provide specified services to the Company in exchange for a quarterly management fee in an amount equal to 0.14323% of the Company’s stockholders’ equity (excluding cash and cash equivalents) as shown on the Company’s balance sheet as of the end of each fiscal quarter of the Company. The MSA provides that the management fee with respect to each fiscal quarter of the Company is to be paid no later than 10 days following the issuance of the Company’s financial statements for such fiscal quarter, and in any event no later than 60 days following the end of each fiscal quarter. For the six months ended June 30, 2018 and 2017, Ancora Advisors, LLC agreed to waive payment of the management fee, but reserves the right to institute payment of the management fee at its discretion. On November 1, 2016, in connection with the Acquisition, BRJ LLC entered into a Management Services Agreement (the “BRJ MSA”) with Lorraine Capital, LLC, a member of BRJ LLC, whereby Lorraine Capital, LLC agreed to provide specified management, financial and reporting services to us in exchange for an annual management fee in an amount equal to the greater of (i) $75,000 or (ii) five percent (5%) of the annual EBITDA (as defined in the BRJ MSA) of BRJ LLC, payable quarterly in arrears and subject to certain adjustments and offsets set forth in the BRJ MSA. The BRJ MSA may be terminated by BRJ LLC, Lorraine Capital, LLC or Regional Brands at any time upon 60 days’ prior written notice and also terminates upon the consummation of a sale of BRJ LLC. For the six months ended June 30, 2018 and year ended December 31, 2017, the fees payable to Lorraine Capital LLC were approximately $53,000 and $36,000, respectively. BRJ LLC has a relationship with a union qualified commercial window subcontractor, Airways Door Service, Inc. (“ADSI”), which is advantageous to us in situations that require union installation and repair services. Individuals affiliated with Lorraine Capital, LLC acquired 57% of ADSI’s common stock; the remaining common stock is owned by three of BRJ LLC’s employees. BRJ LLC paid ADSI approximately $823,000 and $898,000 for its services during the six months ended June 30, 2018 and 2017, respectively. In addition, we provide ADSI services utilizing an agreed-upon fee schedule. These services include accounting, warehousing, equipment use, employee benefit administration, risk management coordination and clerical functions. The fee for these services was $21,000 and $23,250 during the six months ended June 30, 2018 and 2017, respectively. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 7. INCOME TAXES We account for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that may be in effect when the differences are expected to reverse. The Company periodically evaluates the likelihood of realization of deferred tax assets, and provides for a valuation allowance when necessary. The Company currently maintains a full valuation allowance on the deferred tax assets associated with certain pre-acquisition losses that are subject to limitations under Internal Revenue Code Section 382. On December 22, 2017, the U.S. Tax Cuts and Jobs Act (the “Tax Act”) was passed into law. The Act reduces the US federal corporate income tax rate from a top marginal rate of 35% in 2017 and prior to 21% in 2018. The Company’s marginal tax rate in 2017 and prior was 34%. The Company has an effective income tax rate of 23.0% and 22.8% for the three and six months ended June 30, 2018, respectively, and 50.4% and 94.0% for the three and six months ended June 30, 2017, respectively. The 2018 effective tax rate is higher than the 2018 federal statutory rate of 21% due primarily to state income taxes offset by the dividends received deduction and nontaxable income of noncontrolling interest. The 2017 effective tax rate is higher than the 2017 federal statutory rate of 34% primarily due to the reasons above in addition to provisions for deferred tax valuation allowances. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | NOTE 8. BUSINESS ACQUISITIONS Effective June 1, 2018, the Company acquired certain assets of R&D Fabricators, Inc. (R&D) for a purchase price of $200,000. R&D is engaged in the business of the fabrication of aluminum curtain walls, store fronts, doors and frames. The fair value of assets acquired include $120,000 of equipment, $51,000 of acquired backlog and $29,000 of covenants not to compete. The fair value of the assets acquired approximates the consideration paid. The operating results of R&D are included in the accompanying statement of income from the date of acquisition. Pro forma disclosures of revenue and earnings is not material to the Company. During the six months ended June 30, 2017, a payment of $1,107,872 was made to the seller in the BRJ Inc. acquisition to satisfy our working capital liability. |
NATURE OF BUSINESS AND SUMMAR14
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Organization And Business Activities Policy [Policy Text Block] | Regional Brands Inc. (formerly 4net Software, Inc.) (“Regional Brands,” the “Company,” “we,” “our” and “us”) was incorporated under the laws of the State of Delaware in 1986. Regional Brands is a holding company formed to acquire substantial ownership in regional companies with strong brand recognition, stable revenues and profitability. Regional Brands has been pursuing a business strategy whereby it seeks to engage in an acquisition, merger or other business combination transaction with undervalued businesses (each, a “Target Company”) with a history of operating revenues in markets that provide opportunities for growth. On November 1, 2016 the Company's majority-owned subsidiary acquired substantially all of the assets (the “Acquisition”) of B.R. Johnson, Inc. (“BRJ Inc.”), a seller and distributor of windows, doors and related hardware as well as specialty products for use in commercial and residential buildings. After the acquisition of the business of BRJ Inc. by our majority-owned subsidiary, B.R. Johnson, LLC (“BRJ LLC”), we are currently focused on considering opportunities for growth of BRJ LLC through utilizing its balance sheet to provide capital for additional acquisitions of companies that would be complementary to BRJ LLC. Additionally, we may seek to acquire Target Companies that satisfy the following criteria: (1) established businesses with viable services or products; (2) an experienced and qualified management team; (3) opportunities for growth and/or expansion into other markets; (4) are accretive to earnings; (5) offer the opportunity to achieve and/or enhance profitability; and (6) increase shareholder value. |
Basis of Presentation and Significant Accounting Policies [Text Block] | Basis of Presentation - |
Restatement of Income Per Common Share [Policy Text Block] | Restatement of Income Per Common Share The effect of the restatement on the applicable 2017 periods is as follows: Income (loss) per common share Year Ended Nine Months Ended Six Months Ended Three Months Ended - basic and diluted December 31, 2017 September 30, 2017 June 30, 2017 September 30, 2017 June 30, 2017 As originally reported $ 0.63 $ 0.56 $ 0.01 $ 0.56 $ 0.25 Adjustment $ (0.15 ) $ (0.08 ) $ (0.02 ) $ (0.06 ) $ (0.02 ) As adjusted $ 0.48 $ 0.48 $ (0.01 ) $ 0.50 $ 0.23 A reconciliation of income attributable to common shareholders to the amounts used to calculate Income (loss) available to common shareholders is as follows: Income attributable to common shareholders $ 810,124 $ 718,431 $ 7,616 $ 710,815 $ 322,579 Distributions to certain noncontrolling interests $ (197,016 ) $ (99,346 ) $ (27,228 ) $ (72,118 ) $ (27,228 ) Income (loss) available to common shareholders $ 613,108 $ 619,085 $ (19,612 ) $ 638,697 $ 295,351 |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates |
Inventory, Policy [Policy Text Block] | Inventories |
Earnings Per Share, Policy [Policy Text Block] | Common Shares Issued and Earnings (Loss) Per Share A reconciliation of income attributable to common shareholders and the amount used in the income per share calculations is as follows: Three Months Ended Six Months Ended June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 Income ommon shareholders $ 606,723 $ 322,579 $ 561,917 $ 7,616 Distributions to certain noncontrolling interests $ (46,935 ) $ (27,228 ) $ (46,935 ) $ (27,228 ) Income (loss) available to common shareholders $ 559,788 $ 295,351 $ 514,982 $ (19,612 ) Weighted average common shares outstanding- basic and diluted 1,274,603 1,274,603 1,274,603 1,274,603 Income (loss) per common share-basic and diluted $ 0.44 $ 0.23 $ 0.40 $ (0.01 ) |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Fair Value Measurement Topic of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include: · Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; · Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and · Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. The Company’s valuation techniques used to measure the fair value of money market funds, certificate of deposits, and certain marketable equity securities were derived from quoted prices in active markets for identical assets or liabilities. In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option for any eligible financial instruments. Our short-term investments consist of investments in marketable equity related securities and money market funds. All of these marketable securities are accounted for as available-for-sale securities, which are carried at fair value using quoted market prices in active markets for each marketable security. Prior to 2018, any unrealized gains or losses on these securities were recognized through other comprehensive income (loss). Beginning on January 1, 2018 with the adoption of Accounting Standards Update ("ASU") 2016-01, all of our marketable equity securities and money market funds will continue to be carried at fair value as noted above, with any unrealized gains or losses on the securities recognized as a component of other income included on our Condensed Consolidated Statements of Income. As a result of the adoption of ASU 2016-01, the accumulated deficit for the year ended December 31, 2017 was increased by $1,504 and the net income for the six months ended June 30, 2017 was decreased by $1,476. The tables below present the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 aggregated by the level in the fair value hierarchy within which those measurements fall. Assets Level 1 Level 2 Level 3 Balance at June 30, 2018 Marketable Equity Securities $ 2,264,718 $ — $ — $ 2,264,718 Money Market Funds $ 4,347,665 $ — $ — $ 4,347,665 Assets Level 1 Level 2 Level 3 Balance at December 31, 2017 Marketable Equity Securities $ 1,967,145 $ — $ — $ 1,967,145 Money Market Funds $ 4,353,567 $ — $ — $ 4,353,567 |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In February 2016, the FASB issued an accounting standard update ASU 2016-02, “Leases" to replace existing lease accounting guidance. This pronouncement is intended to provide enhanced transparency and comparability by requiring lessees to record right-of-use assets and corresponding lease liabilities on the balance sheet for most leases. Expenses associated with leases will continue to be recognized in a manner similar to current accounting guidance. This pronouncement is effective for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The adoption is required to be applied on a modified retrospective basis for each prior reporting period presented. The Company has not yet determined the effect that the adoption of this pronouncement may have on its financial position and/or results of operations. In August 2016, the FASB issued Accounting Standards Update 2016-15, “Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments”. The standard makes eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. The standard is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The new standard requires adoption on a retrospective basis unless it is impracticable to apply, in which case the Company would be required to apply the amendments prospectively as of the earliest date practicable. The Company has adopted this standard effective January 1, 2018. Adoption of this standard did not impact our Consolidated Financial Statements for the current or prior periods presented. In May 2017, the FASB issued Accounting Standards Update 2017-09, “Compensation – Stock Compensation (Topic 718) – Scope of Modification Accounting”, which provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The standard is effective for fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. The standard is to be applied on a prospective basis to an award modified on or after the adoption date. The Company has adopted this standard effective January 1, 2018. Adoption of this standard did not impact our Consolidated Financial Statements. |
NATURE OF BUSINESS AND SUMMAR15
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | The effect of the restatement on the applicable 2017 periods is as follows: Income(loss) per common share Year Ended Nine Months Ended Six Months Ended Three Months Ended - basic and diluted December 31, 2017 September 30, 2017 June 30, 2017 September 30, 2017 June 30, 2017 As originally reported $ 0.63 $ 0.56 $ 0.01 $ 0.56 $ 0.25 Adjustment $ (0.15 ) $ (0.08 ) $ (0.02 ) $ (0.06 ) $ (0.02 ) As adjusted $ 0.48 $ 0.48 $ (0.01 ) $ 0.50 $ 0.23 A reconciliation of income attributable to common shareholders to the amounts used to calculate Income (loss) available to common shareholders is as follows: Income attributable to common shareholders $ 810,124 $ 718,431 $ 7,616 $ 710,815 $ 322,579 Distributions to certain noncontrolling interests $ (197,016 ) $ (99,346 ) $ (27,228 ) $ (72,118 ) $ (27,228 ) Income (loss) available to common shareholders $ 613,108 $ 619,085 $ (19,612 ) $ 638,697 $ 295,351 |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | A reconciliation of income attributable to common shareholders and the amount used in the income per share calculations is as follows: Three Months Ended Six Months Ended June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 Income ommon shareholders $ 606,723 $ 322,579 $ 561,917 $ 7,616 Distributions to certain noncontrolling interests $ (46,935 ) $ (27,228 ) $ (46,935 ) $ (27,228 ) Income (loss) available to common shareholders $ 559,788 $ 295,351 $ 514,982 $ (19,612 ) Weighted average common shares outstanding- basic and diluted 1,274,603 1,274,603 1,274,603 1,274,603 Income (loss) per common share-basic and diluted $ 0.44 $ 0.23 $ 0.40 $ (0.01 ) |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | The tables below present the Company's assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 aggregated by the level in the fair value hierarchy within which those measurements fall. Assets Level 1 Level 2 Level 3 Balance at June 30, 2018 Marketable Equity Securities $ 2,264,718 $ — $ — $ 2,264,718 Money Market Funds $ 4,347,665 $ — $ — $ 4,347,665 Assets Level 1 Level 2 Level 3 Balance at December 31, 2017 Marketable Equity Securities $ 1,967,145 $ — $ — $ 1,967,145 Money Market Funds $ 4,353,567 $ — $ — $ 4,353,567 |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of revenue recognition [Abstract] | |
Disaggregation of Revenue [Table Text Block] | The following table presents our revenues disaggregated by contracts accounted for using the percentage of completion method. Sales and usage taxes are excluded from revenues: Quarter Ended June 30, 2018 2017 Contracts under percentage of completion $ 6,584,736 $ 7,356,193 All other 5,336,110 3,795,759 Total revenue $ 11,920,846 $ 11,151,952 Six Months Ended June 30, 2018 2017 Contracts under percentage of completion $ 10,885,302 $ 12,043,619 All other 9,198,328 7,854,682 Total revenue $ 20,083,630 $ 19,898,301 |
CONTRACT ASSETS AND LIABILITI17
CONTRACT ASSETS AND LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Contractors [Abstract] | |
Schedule For Uncompleted Contract [Table Text Block] | The following is information with respect to uncompleted contracts: June 30, 2018 December 31, 2017 Costs incurred on uncompleted contracts $ 9,800,255 $ 8,404,168 Estimated earnings 2,832,693 3,695,967 12,632,948 12,100,135 Less billings to date 11,812,468 11,205,627 $ 820,480 $ 894,508 Included on balance sheet as follows: Under current assets Costs and estimated earnings in excess of billings on uncompleted contracts $ 1,439,404 $ 1,087,218 Under current liabilities Billings in excess of costs and estimated earnings on uncompleted contracts $ (618,924 ) $ (192,710 ) $ 820,480 $ 894,508 |
NATURE OF BUSINESS AND SUMMAR18
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | |
Earnings Per Share, Basic and Diluted | $ 0.44 | $ 0.50 | $ 0.23 | $ 0.40 | $ (0.01) | $ 0.48 | $ 0.48 |
Income attributable to common shareholders | $ 606,723 | $ 710,815 | $ 322,579 | $ 561,917 | $ 7,616 | $ 718,431 | $ 810,124 |
Distributions to certain noncontrolling interests | (46,935) | (72,118) | (27,228) | (46,935) | (27,228) | (99,346) | (197,016) |
Income (loss) available to common shareholders | $ 559,788 | $ 638,697 | $ 295,351 | $ 514,982 | $ (19,612) | $ 619,085 | $ 613,108 |
Previously Reported [Member] | |||||||
Earnings Per Share, Basic and Diluted | $ 0.56 | $ 0.25 | $ 0.01 | $ 0.56 | $ 0.63 | ||
Restatement Adjustment [Member] | |||||||
Earnings Per Share, Basic and Diluted | $ (0.06) | $ (0.02) | $ (0.02) | $ (0.08) | $ (0.15) |
NATURE OF BUSINESS AND SUMMAR19
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($) | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | |
Income attributable to common shareholders | $ 606,723 | $ 710,815 | $ 322,579 | $ 561,917 | $ 7,616 | $ 718,431 | $ 810,124 |
Distributions to certain noncontrolling interests | (46,935) | (72,118) | (27,228) | (46,935) | (27,228) | (99,346) | (197,016) |
Income (loss) available to common shareholders | $ 559,788 | $ 638,697 | $ 295,351 | $ 514,982 | $ (19,612) | $ 619,085 | $ 613,108 |
Weighted average common shares outstanding- basic and diluted | 1,274,603 | 1,274,603 | 1,274,603 | 1,274,603 | |||
Income (loss) per common share-basic and diluted | $ 0.44 | $ 0.50 | $ 0.23 | $ 0.40 | $ (0.01) | $ 0.48 | $ 0.48 |
NATURE OF BUSINESS AND SUMMAR20
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2) - USD ($) | Jun. 30, 2018 | Dec. 31, 2017 |
Marketable Equity Securities [Member] | ||
Assets, Fair Value Disclosure | $ 2,264,718 | $ 1,967,145 |
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure | 2,264,718 | 1,967,145 |
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Money Market Funds [Member] | ||
Assets, Fair Value Disclosure | 4,347,665 | 4,353,567 |
Money Market Funds [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Assets, Fair Value Disclosure | 4,347,665 | 4,353,567 |
Money Market Funds [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Assets, Fair Value Disclosure | 0 | 0 |
Money Market Funds [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Assets, Fair Value Disclosure | $ 0 | $ 0 |
NATURE OF BUSINESS AND SUMMAR21
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Summary Of Significant Accounting Policies [Line Items] | ||
Inventory, Work in Process, Gross | $ 948,127 | $ 676,153 |
Inventory Valuation Reserves | 72,000 | 66,000 |
Accounting Standards Update 2016-01 [Member] | ||
Summary Of Significant Accounting Policies [Line Items] | ||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Accumulated Deficit | $ 1,504 | |
New Accounting Pronouncement or Change in Accounting Principle, Effect of Change on Net Income | $ 1,476 |
REVENUE RECOGNITION (Details)
REVENUE RECOGNITION (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Total revenue | $ 11,920,846 | $ 11,151,952 | $ 20,083,630 | $ 19,898,301 |
Contracts under percentage of completion [Member] | ||||
Revenue from Contract with Customer, Including Assessed Tax | 6,584,736 | 7,356,193 | 10,885,302 | 12,043,619 |
All other [Member] | ||||
Revenue from Contract with Customer, Including Assessed Tax | $ 5,336,110 | $ 3,795,759 | $ 9,198,328 | $ 7,854,682 |
REVENUE RECOGNITION (Details Te
REVENUE RECOGNITION (Details Textual) $ in Millions | Jun. 30, 2018USD ($) |
Revenue, Remaining Performance Obligation | $ 14.7 |
CONTRACT ASSETS AND LIABILITI24
CONTRACT ASSETS AND LIABILITIES (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Dec. 31, 2017 | |
Costs incurred on uncompleted contracts | $ 9,800,255 | $ 8,404,168 |
Estimated earnings | 2,832,693 | 3,695,967 |
Contract In Process, Total Cost And Estimated Earning | 12,632,948 | 12,100,135 |
Less: billings to date | 11,812,468 | 11,205,627 |
Contracted Balance Billing Net | 820,480 | 894,508 |
Under current assets | ||
Costs and estimated earnings in excess of billings on uncompleted contracts | 1,439,404 | 1,087,218 |
Under current liabilities | ||
Billings in excess of costs and estimated earnings on uncompleted contracts | (618,924) | (192,710) |
Contracted Balance Billing Net | $ 820,480 | $ 894,508 |
CONTRACT ASSETS AND LIABILITI25
CONTRACT ASSETS AND LIABILITIES (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Revenues | $ 11,920,846 | $ 11,151,952 | $ 20,083,630 | $ 19,898,301 | |
Unbilled Revenues [Member] | |||||
Revenues | $ 1,219,379 | $ 1,043,082 |
DEBT (Details Textual)
DEBT (Details Textual) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Line of Credit Facility, Interest Rate Description | Interest under the Credit Facility is payable monthly and accrues pursuant to the “base rate” of interest, which is equal to the highest of (a) KeyBank, N.A.’s prime rate, (b) one-half of one percent (0.50%) in excess of the Federal Funds Effective Rate of the Federal Reserve Bank of New York, and (c) one hundred (100) basis points in excess of the London Interbank Offered Rate for loans in Eurodollars with an interest period of one month, plus any applicable margin. |
Debt Instrument, Description | The Credit Facility contains customary financial and other covenant requirements, including, but not limited to, a covenant to not permit BRJ LLC’s consolidated fixed charge coverage ratio to exceed 1.15 to 1.00. |
Letter of Credit [Member] | |
Letter of Credit Facility, Maximum Borrowing Capacity | $ 500,000 |
Proceeds from Lines of Credit | 1,900,000 |
Credit Agreement [Member] | |
Letter of Credit Facility, Maximum Borrowing Capacity | $ 6,000,000 |
Line of Credit Facility, Interest Rate at Period End | 3.69% |
Borrowings outstanding under Credit Facility | $ 2,931,526 |
Letters of Credit Outstanding, Amount | $ 250,000 |
STOCKHOLDERS' EQUITY (Details T
STOCKHOLDERS' EQUITY (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 01, 2018 | Dec. 31, 2017 | Jun. 15, 2017 | Mar. 02, 2017 | |
Class of Stock [Line Items] | ||||||||
Common Stock, Shares Authorized | 3,000,000 | 3,000,000 | 3,000,000 | |||||
Common Stock, Par or Stated Value Per Share | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||||
Preferred Stock, Shares Authorized | 50,000 | 50,000 | 50,000 | |||||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Share-based Compensation | $ 13,878 | $ 15,397 | $ 27,920 | $ 31,000 | ||||
Maximum [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Common Stock, Shares Authorized | 50,000,000 | |||||||
Preferred Stock, Shares Authorized | 5,000,000 | |||||||
Minimum [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Common Stock, Shares Authorized | 3,000,000 | |||||||
Preferred Stock, Shares Authorized | 50,000 | |||||||
Amended Restated Equity Incentive Plan [Member] | ||||||||
Class of Stock [Line Items] | ||||||||
Common Stock, Par or Stated Value Per Share | $ 0.00001 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 130,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Related Party Transaction [Line Items] | ||
Related party transaction Management fee percentage | 0.14323% | |
Airways Door Services [Member] | ||
Related Party Transaction [Line Items] | ||
Fee income for services provided to ADSI | $ 21,000 | $ 23,250 |
Payments to ADSI for Services | $ 823,000 | 898,000 |
Business Acquisition, Percentage of Voting Interests Acquired | 57.00% | |
Lorraine Capital Llc [Member] | ||
Related Party Transaction [Line Items] | ||
Payments to ADSI for Services | $ 53,000 | $ 36,000 |
Management Fee, Description | an annual management fee in an amount equal to the greater of (i) $75,000 or (ii) five percent (5%) of the annual EBITDA (as defined in the BRJ MSA) of BRJ LLC, payable quarterly in arrears and subject to certain adjustments and offsets set forth in the BRJ MSA. The BRJ MSA may be terminated by BRJ LLC, Lorraine Capital, LLC or Regional Brands at any time upon 60 days’ prior written notice and also terminates upon the consummation of a sale of BRJ LLC. |
INCOME TAXES (Details Textual)
INCOME TAXES (Details Textual) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate Reconciliation, Percent | 23.00% | 50.40% | 22.80% | 94.00% | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | |||||
Effective Income Tax Rate Reconciliation Marginal Tax Rate | 34.00% | |||||
Scenario, Plan [Member] | ||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% |
BUSINESS ACQUISITIONS (Details
BUSINESS ACQUISITIONS (Details Textual) - USD ($) | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 01, 2018 | |
Payments to Acquire Businesses, Gross | $ 200,000 | $ 1,107,872 | |
RD Fabricators Inc [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 200,000 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Equipment | 120,000 | ||
Payments to Acquire Businesses, Gross | $ 1,107,872 | ||
RD Fabricators Inc [Member] | Order or Production Backlog [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 51,000 | ||
RD Fabricators Inc [Member] | Noncompete Agreements [Member] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 29,000 |