Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 26, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Entity Registrant Name | SERVOTRONICS INC /DE/ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 2,488,427 | |
Entity Central Index Key | 0000089140 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Trading Symbol | svt | |
Title of 12(b) Security | Common Stock | |
Security Exchange Name | NYSEAMER |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash | $ 7,468 | $ 2,029 |
Accounts receivable, net | 6,769 | 13,183 |
Inventories, net | 25,153 | 20,151 |
Prepaid income taxes | 768 | 416 |
Other current assets | 670 | 522 |
Total current assets | 40,828 | 36,301 |
Property, plant and equipment, net | 12,360 | 12,717 |
Deferred income taxes | 107 | 107 |
Other non-current assets | 337 | 345 |
Total Assets | 53,632 | 49,470 |
Current liabilities: | ||
Current portion of long-term debt | 548 | 548 |
Current portion of equipment financing lease obligations | 301 | 301 |
Dividend payable | 16 | 17 |
Accounts payable | 3,245 | 4,458 |
Accrued employee compensation and benefits costs | 2,289 | 2,283 |
Other accrued liabilities | 752 | 1,035 |
Total current liabilities | 7,151 | 8,642 |
Long-term debt | 9,290 | 5,170 |
Post retirement obligation | 2,423 | 2,126 |
Shareholders' equity: | ||
Common stock, par value $0.20; authorized 4,000,000 shares; issued 2,614,506 shares; outstanding 2,401,001 (2,399,576 - 2019) shares | 523 | 523 |
Capital in excess of par value | 14,459 | 14,358 |
Retained earnings | 21,565 | 20,484 |
Accumulated other comprehensive income | 98 | 98 |
Employee stock ownership trust commitment | (460) | (460) |
Treasury stock, at cost 126,079 (127,504 - 2019) shares | (1,417) | (1,471) |
Total shareholders' equity | 34,768 | 33,532 |
Total Liabilities and Shareholders' Equity | $ 53,632 | $ 49,470 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.20 | $ 0.20 |
Common stock, shares authorized | 4,000,000 | 4,000,000 |
Common stock, shares issued | 2,614,506 | 2,614,506 |
Common stock, shares outstanding | 2,401,001 | 2,399,576 |
Treasury stock, shares | 126,079 | 127,504 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OFOPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
Revenue | $ 10,297 | $ 12,362 | $ 39,249 | $ 38,432 | ||||
Cost of goods sold, inclusive of depreciation and amortization | 10,462 | 8,827 | 31,682 | 29,555 | ||||
Gross margin (loss) income | (165) | 3,535 | 7,567 | 8,877 | ||||
Operating Expenses: | ||||||||
Selling, general and administrative | 2,096 | 2,134 | 6,112 | 6,436 | ||||
Interest expense | 42 | 31 | 134 | 88 | ||||
Total operating expenses | 2,138 | 2,165 | 6,246 | 6,524 | ||||
(Loss) income before income tax provision | (2,303) | 1,370 | 1,321 | 2,353 | ||||
Income tax (benefit) provision | (521) | 238 | 240 | 409 | ||||
Net (loss)income | $ (1,782) | $ 965 | $ 1,898 | $ 1,132 | $ 714 | $ 98 | $ 1,081 | $ 1,944 |
Basic | ||||||||
Net (loss) income per share | $ (0.75) | $ 0.49 | $ 0.46 | $ 0.84 | ||||
Diluted | ||||||||
Net (loss) income per share | $ (0.75) | $ 0.47 | $ 0.45 | $ 0.82 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows related to operating activities: | ||
Net (Loss) Income | $ 1,081 | $ 1,944 |
Adjustments to reconcile net income to net cash generated /(used) by operating activities: | ||
Depreciation and amortization | 1,072 | 902 |
Gain on disposal of property | (1) | (7) |
Stock based compensation | 255 | 239 |
Decrease in allowance doubtful accounts | (150) | (29) |
Increase/(decrease) in inventory reserve | 240 | (55) |
Decrease in warranty reserve | (133) | (8) |
Change in assets and liabilities: | ||
Accounts receivable | 6,564 | (334) |
Inventories | (5,242) | (4,674) |
Prepaid income taxes | (352) | 314 |
Other current assets | (148) | 234 |
Other non-current assets | 1 | (125) |
Accounts payable | (1,213) | 848 |
Accrued employee compensation and benefit costs | 6 | 264 |
Other accrued liabilities | 147 | 228 |
Accrued income taxes | 14 | |
Net cash generated/(used) by operating activities | 2,127 | (245) |
Cash flows related to investing activities: | ||
Capital expenditures - property, plant and equipment | (708) | (1,660) |
Proceeds from sale of assets | 94 | |
Note Receivable | (125) | |
Net cash (used) by investing activities | (708) | (1,691) |
Cash flows related to financing activities: | ||
Principal payments on long-term debt | (410) | (411) |
Principal payments on equipment financing lease/note obligations | (220) | (208) |
Proceeds from equipment note and equipment financing lease | 676 | |
Proceeds from the line of credit | 750 | 1,000 |
Proceeds from paycheck protection program | 4,000 | |
Purchase of treasury shares | (100) | (157) |
Cash dividend | (404) | |
Net cash generated by financing activities | 4,020 | 496 |
Net increase/(decrease) in cash | 5,439 | (1,440) |
Cash at beginning of period | 2,029 | 2,598 |
Cash at end of period | $ 7,468 | 1,158 |
Supplemental Cash Flow Information: | ||
Equipment acquired through financing paid directly to vendor | $ 286 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements (“consolidated financial statements”) have been prepared in accordance with United States generally accepted accounting principles for interim financial information and with the instructions to Form 10‑Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements. The accompanying consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The consolidated financial statements should be read in conjunction with the 2019 annual report and the notes thereto. |
Business Description and Summar
Business Description and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Business Description and Summary of Significant Accounting Policies | |
Business Description and Summary of Significant Accounting Policies | 2. Business Description and Summary of Significant Accounting Policies Business Description Servotronics, Inc. and its subsidiaries design, manufacture and market advanced technology products consisting primarily of control components, and consumer products consisting of knives and various types of cutlery and other edged products. Principles of Consolidation The consolidated financial statements include the accounts of Servotronics, Inc. and its wholly-owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated upon consolidation. Cash The Company considers cash to include all currency and coins owned by the Company as well as all deposits in the bank including checking accounts and savings accounts. Accounts Receivable The Company grants credit to substantially all of its customers and carries its accounts receivable at original invoice amount less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on history of past write-offs, collections, and current credit conditions. The allowance for doubtful accounts amounted to approximately $188,000 at September 30, 2020 and $337,000 at December 31, 2019. The Company does not accrue interest on past due receivables. Revenue Recognition Revenues are recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Purchase orders generally include specific terms relative to quantity, item description, specifications, price, customer responsibility for in-process costs, delivery schedule, shipping point, payment and other standard terms and conditions of purchase. Service sales, principally representing repair, are recognized at the time of shipment of goods. The costs incurred for nonrecurring engineering, development and repair activities of our products under agreements with commercial customers are expensed as incurred. Subsequently, the revenue is recognized as products are delivered to the customers with the approval by the customers. Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods and services to a customer. The Company determines revenue recognition using the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when the company satisfies a performance obligation. Revenue excludes taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer (e.g., sales and use taxes). Revenue includes payments for shipping activities that are reimbursed by the customer to the Company. Performance obligations are satisfied as of a point in time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract. As a significant portion of the Company’s revenue are recognized at the time of shipment, transfer of title and customer acceptance, there is no significant judgment applied to determine the timing of the satisfaction of performance obligations or transaction price. The timing of satisfaction of our performance obligations does not significantly vary from the typical timing of payment. The Company generally receives payment for these contracts within the payment terms negotiated and agreed upon by each customer contract. Warranty and repair obligations are assessed on all returns. Revenue is not recorded on any warranty returns. The Company warrants its products against design, materials and workmanship based on an average of twenty-seven months. The Company determines warranty reserves needed based on actual average costs of warranty units shipped and current facts and circumstances. As of September 30, 2020 and December 31, 2019 under the guidance of ASC460 the Company has recorded a warranty reserve of approximately $287,000 and $420,000, respectively. This amount is reflected in other accrued expenses in the accompanying consolidated balance sheets. Revenue is recognized on repair returns, covered under a customer contract, at the contractual price upon shipment to the customer. Inventories Inventories are stated at the lower of cost or net realizable value. Cost includes all costs incurred to bring each product to its present location and condition. Market provisions in respect of lower of cost or market adjustments and inventory expected to be used in greater than two years are applied to the gross value of the inventory through a reserve of approximately $1,677,000 and $1,437,000 at September 30, 2020 and December 31, 2019, respectively. Pre-production and start-up costs are expensed as incurred. The purchase of suppliers’ minimum economic quantities of material such as steel, etc. may result in a purchase of quantities exceeding one year of customer requirements. Also, in order to maintain a reasonable and/or agreed to lead time, certain larger quantities of other product support items may have to be purchased and may result in over one year’s supply. These amounts are not included in the inventory reserve discussed above. Shipping and Handling Costs Shipping and handling costs are classified as a component of cost of goods sold. Property, Plant and Equipment Property, plant and equipment is carried at cost; expenditures for new facilities and equipment and expenditures which substantially increase the useful lives of existing plant and equipment are capitalized; expenditures for maintenance and repairs are expensed as incurred. Upon disposal of properties, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposition is included in income. Depreciation is provided on the basis of estimated useful lives of depreciable properties, primarily by the straight-line method for financial statement purposes and by accelerated methods for income tax purposes. Depreciation expense includes the amortization of right-of-use (“ROU”) assets accounted for as finance leases. The estimated useful lives of depreciable properties are generally as follows: Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3‑5 years Income Taxes For the Nine Months Ended September 30, 2020 2019 % Change ($000's omitted) Income tax expense $ 240 $ 409 (41.3) % Effective tax rate 18.2 % 17.4 % 0.8 % The higher effective tax rate during the nine months ended September 30, 2020 was primarily due to a decrease in permanent deductible expenses. In response to COVID-19, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) was signed into law on March 27, 2020. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding the prior and future utilization of net operating losses, temporary suspension of certain payment requirements for the employer portion of Social Security taxes, technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property, and the creation of certain refundable employee retention credits. The Company is currently evaluating the impact of these measures on its consolidated financial statements. If these measures are determined to be applicable to the Company, they may result in cash refunds and an income tax benefit recorded in the consolidated statement of operations. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, as well as operating loss and credit carryforwards. The Company and its subsidiaries file a consolidated federal income tax return, combined New York and Texas state income tax returns and various separate state income tax returns. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at September 30, 2020 or December 31, 2019, and did not recognize any interest and/or penalties in its consolidated statements of operations during the nine months ended September 30, 2020 and 2019. The Company did not have any material uncertain tax positions or unrecognized tax benefits or obligations as of September 30, 2020 and December 31, 2019. On July 16, 2020, the Company was notified that the 2017 federal income tax return was randomly selected for examination. The 2016 through 2019 federal and state tax returns remain subject to examination. Supplemental Cash Flow Information Income taxes paid during the nine months ended September 30, 2020 and 2019 amounted to approximately $425,000 and $0, respectively. Interest paid during the nine months ended September 30, 2020 and 2019 amounted to approximately $116,000 and $88,000, respectively. Employee Stock Ownership Plan Contributions to the employee stock ownership plan are determined annually by the Company according to plan formula. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable based on undiscounted future operating cash flow analyses. If an impairment is determined to exist, any related impairment loss is calculated based on fair value. Due to the losses incurred by our Consumer Products Group ("CPG"), we performed a test for recoverability of the long-lived assets by comparing its carrying value to the future undiscounted cash flows that we expect will be generated by the asset group. Impairment losses on assets to be disposed of, if any, are based on the estimated proceeds to be received, less costs of disposal. The Company has determined that no impairment of long-lived assets existed at September 30, 2020 and December 31, 2019. Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications Certain balances, as previously reported, were reclassified to conform to classifications adopted in the current period. Research and Development Costs Research and development costs are expensed as incurred. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks principally consist of cash accounts in financial institutions. Although the accounts exceed the federally insured deposit amount, management does not anticipate nonperformance by the financial institutions. Fair Value of Financial Instruments The carrying amount of cash, accounts receivable, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. Based on variable interest rates and the borrowing rates currently available to the Company for loans similar to its long-term debt, the fair value approximates its carrying amount. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2020 | |
Inventories | |
Inventories | 3. Inventories September 30, December 31, 2020 2019 ($000’s omitted) Raw material and common parts $ 17,599 $ 14,707 Work-in-process 4,700 4,158 Finished goods 4,531 2,723 26,830 21,588 Less inventory reserve (1,677) (1,437) Total inventories $ 25,153 $ 20,151 |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment | |
Property, Plant and Equipment | 4. Property, Plant and Equipment September 30, December 31, 2020 2019 ($000’s omitted) Land $ 7 $ 7 Buildings 11,641 11,017 Machinery, equipment and tooling 20,820 20,695 Construction in progress 222 331 32,690 32,050 Less accumulated depreciation and amortization (20,330) (19,333) Total property, plant and equipment $ 12,360 $ 12,717 Depreciation and amortization expense amounted to approximately $356,000 and $339,000 for the three months ended September 30, 2020 and 2019, respectively. Amortization expense primarily related to ROU assets amounted to approximately $15,000 and $18,000 for the three months ended September 30, 2020 and 2019, respectively. Depreciation and amortization expense amounted to approximately $1,072,000 and $902,000 for the nine months ended September 30, 2020 and 2019, respectively. Amortization expense, primarily related to ROU assets, amounted to approximately $50,000 and $59,000 for the nine months ended September 30, 2020 and 2019, respectively. The Company maintains property and casualty insurance in amounts adequate for the risk and nature of its assets and operations and which are generally customary in its industry. As of September 30, 2020, there is approximately $222,000 ($331,000 – December 31, 2019) of construction in progress (CIP) included in property, plant and equipment all of which is related to capital projects. There is approximately $192,000 for machinery & equipment; $22,000 for building improvements, and $8,000 for IT equipment and software, not yet put into service. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2020 | |
Long-Term Debt | |
Long-Term Debt | 5. Long-Term Debt September 30, December 31, 2020 2019 ($000’s omitted) Paycheck protection progam payable to financial institutions: Interest rate of 1% per annum. Unforgiven portion is payable monthly until April 20, 2022 (A) $ 4,000 $ — Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B)(C) 3,750 3,000 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September30, 2020), monthly principal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021(C). 1,114 1,310 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September 30, 2020), monthly principal payments of $23,810 through December 1, 2021(C). 357 571 Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) 569 670 Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) 349 468 10,139 6,019 Less current portion (849) (849) $ 9,290 $ 5,170 A.) On April 21, 2020, the Company executed a promissory note (the "Note") in the amount of $4,000,000 as part of the Paycheck Protection Program (the "PPP Loan") administered by the Small Business Administration (the "SBA") and authorized under the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act"). The PPP Loan is being made through the Bank of America, NA (the "Lender"). The term of the PPP Loan is two years with an annual interest rate of 1.00%. Payments on the unforgiven amount of principal, if any, and interest on the PPP Loan will be deferred until the date on which loan forgiveness is determined or 10 months after the end of the borrower's covered period if forgiveness is not requested.“ B.) As of March 20, 2020, the Company increased its line of credit from $4,000,000 to $6,000,000. As of July 31, 2020, the Company extended the line of credit to expire December 21, 2022. As of July 31, 2020, the interest rate is a rate per year equal to the bank’s prime rate or Libor plus 1.65%. In addition, the Company is required to pay a commitment fee of 0.25% per year on the unused portion of the line of credit. There was $3,750,000 balance outstanding at September 30, 2020 and $3,000,000 balance at December 31, 2019. C.) The term loans and line of credit are secured by all personal property of the Company with the exception of certain equipment that was purchased from proceeds of government grants. Certain lenders require the Company to comply with debt covenants as described in the specific loan documents, including a debt service ratio. At September 30, 2020 and December 31, 2019 the Company was in compliance with these covenants. D.) The Company had an equipment loan facility in the amount of $2,500,000 available until November 30, 2019. This line was non-revolving and non-renewable. The Company used approximately $721,000 of the available funds for the purchase of machinery and equipment. The loan term for the equipment covered by the agreement is 60 months. Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding. There was approximately $569,000 outstanding at September 30, 2020 and $670,000 at December 31, 2019. E.) The Company established a lease line of credit for equipment financing in the amount of $1,000,000 available until June 28, 2018. This line was non-revolving and non-renewable. The lease term for equipment covered by the lease line of credit is 60 months. Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding. There was approximately $349,000 outstanding at September 30, 2020 and $468,000 at December 31, 2019. The Company has an equipment loan facility in the amount of $1,000,000 available until July 9, 2021. This line was non-revolving and non-renewable. The loan term for the equipment covered by the agreement is 60 months. Monthly payments are fixed for the term of each funding based upon the Lender's lease pricing in effect at the time of such funding. There is nothing outstanding as of September 30, 2020 and at December 31, 2019. Remaining principal maturities of long-term debt are as follows: 2020 - $219,000, 2021 - $1,635,000, 2022 - $4,038,000, 2023 - $154,000 and 2024 - $93,000. Remaining principal payments and interest payments for the capital note and capital equipment financing lease obligations for each of the next five years: (Excluding PPP Loan) September 30, December 31, Year 2020 2019 ($000’s omitted) 2020 $ 83 $ 331 2021 331 331 2022 316 316 2023 169 169 2024 97 97 Total principal and interest payments 996 1,244 Less amount representing interest (78) (106) Present value of net minimum lease payments 918 1,138 Less current portion (301) (301) Long term principle payments $ 617 $ 837 |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2020 | |
Shareholders' Equity | |
Shareholders' Equity | 6. Shareholders’ Equity Nine-month Period Ended September 30, 2020 Accumulated Other Capital in Total Retained Comprehensive excess of Treasury shareholders’ Earnings Income Common Stock par value ESOT stock equity January 1, 2020 $ 20,484 $ 98 $ 523 $ 14,358 $ (460) $ (1,471) $ 33,532 Purchase of treasury shares — — — — — (100) (100) Stock based compensation — — — 33 — 52 85 Net Income 1,898 — — — — — 1,898 March 31, 2020 $ 22,382 $ 98 $ 523 $ 14,391 $ (460) $ (1,519) $ 35,415 Stock based compensation — — — 39 — 48 87 Net Income 965 — — — — — 965 June 30, 2020 $ 23,347 $ 98 $ 523 $ 14,430 $ (460) $ (1,471) $ 36,467 Stock based compensation — — — 29 — 54 83 Net Loss (1,782) — — — — — (1,782) September 30, 2020 $ 21,565 $ 98 $ 523 $ 14,459 $ (460) $ (1,417) $ 34,768 Nine-month Period Ended September 30, 2019 Accumulated Other Capital in Total Retained Comprehensive excess of Treasury shareholders’ Earnings Income Common Stock par value ESOT stock equity January 1, 2019 $ 18,788 $ 35 $ 523 $ 14,250 $ (561) $ (1,522) $ 31,513 Purchase of treasury shares — — — — — (128) (128) Stock based compensation — — — 14 — 44 58 Net Income 98 — — — — — 98 March 31, 2019 $ 18,886 $ 35 $ 523 $ 14,264 $ (561) $ (1,606) $ 31,541 Dividends declared ($0.16 per share) (413) — — — — — (413) Purchase of treasury shares — — — — — (21) (21) Stock based compensation — — — 34 — 61 95 Net Income 714 — — — — — 714 June 30, 2019 $ 19,187 $ 35 $ 523 $ 14,298 $ (561) $ (1,566) $ 31,916 Purchase of treasury shares — — — — — (8) (8) Stock based compensation — — — 28 — 58 86 Net Income 1,132 — — — — — 1,132 September 30, 2019 $ 20,319 $ 35 $ 523 $ 14,326 $ (561) $ (1,516) $ 33,126 The Company’s Board of Directors authorized the purchase of up to 450,000 shares of its common stock in the open market or in privately negotiated transactions. As of September 30, 2020, the Company has purchased 360,615 shares and there remains 89,385 shares available to purchase under this program. There were 360 and 5,232 shares purchased by the Company during the nine month period ended September 30, 2020 and 2019, respectively. The Company’s 2012 Long-Term Incentive Plan provides for the granting of stock awards, including restricted stock, stock options and stock appreciation rights, to employees and non-employees, including directors of the Company. Compensation expense is amortized over the related service period, which is normally three years. Shares of unvested restricted stock are generally forfeited if a recipient leaves the Company before the vesting date. Shares that are forfeited become available for future awards. The following is a summary of restricted stock activity for the nine months ended September 30, 2020. Of the shares that vested, the Company withheld 9,543 shares to satisfy the tax obligations for those participants who elected this option as permitted under the applicable equity plan. Shares Unvested at December 31, 2019 54,416 Granted 11,328 Forfeited — Vested 31,998 Unvested at September 30, 2020 33,746 Earnings Per Share Basic earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period. The weighted average number of common shares outstanding does not include any potentially dilutive securities or any unvested restricted shares of common stock. These unvested restricted shares, although classified as issued and outstanding, are considered forfeitable until the restrictions lapse and will not be included in the basic EPS calculation until the shares are vested. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period plus the number of shares of common stock that would be issued assuming all contingently issuable shares having a dilutive effect on the earnings per share that were outstanding for the period. Incremental shares from assumed conversions are calculated as the number of shares that would be issued, net of the number of shares that could be purchased in the marketplace with the cash received upon stock option exercise. The dilutive effect of unvested restrictive stock is determined using the treasury stock method. Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 ($000’s omitted except per share data) Net (Loss) Income $ (1,782) $ 1,132 $ 1,081 $ 1,944 Weighted average common shares outstanding (basic) 2,363 2,327 2,358 2,325 Unvested restricted stock 34 58 34 58 Weighted average common shares outstanding (diluted) 2,397 2,385 2,392 2,383 Basic Net (loss) income per share $ (0.75) $ 0.49 $ 0.46 $ 0.84 Diluted Net (loss) income per share $ (0.75) $ 0.47 $ 0.45 $ 0.82 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies | |
Commitments and Contingencies | 7. Commitments and Contingencies Post retirement obligation. As previously disclosed in filings with the Securities and Exchange Commission (“SEC”), the Company, under an employment agreement, is expected to pay post- employment health related benefits to a former Executive Officer of the Company (the “Former Employee”), of which approximately $1,724,000 and $1,543,000 has been accrued as of September 30, 2020 and December 31, 2019, and is reflected as Post Retirement Obligation in the accompanying consolidated balance sheets. Employment Agreements. The Company provides certain post-employment health and life insurance benefits for its Chief Executive Officer and President Kenneth Trbovich. Upon retirement and after attaining at least the age of 65, the Company will pay for the retired Executive’s and dependent’s health benefits and will continue the Company-provided life insurance offered at the time of retirement. The retiree’s health insurance benefits ceases upon the death of the retired executive. Approximately $699,000 and $583,000 has been accrued as of September 30, 2020 and December 31, 2019, respectively, and is reflected as Post Retirement Obligation in the accompanying consolidated balance sheets. |
Litigation
Litigation | 9 Months Ended |
Sep. 30, 2020 | |
Litigation | |
Litigation | 8. Litigation The Company has pending litigation relative to leases of certain equipment and real property with a former related party. Aero, Inc. is suing Servotronics, Inc. and its wholly owned subsidiary and has alleged damages in the amount of $3,000,000. The Company has filed a response to the Aero, Inc. lawsuit and has also filed a counter-claim in the amount of $3,191,000. The Company considers the risk of loss remote, and is unable to reasonably or accurately estimate the likelihood and amount of any liability or benefit that may be realized as a result of this litigation. Accordingly, no gain or loss has been recognized in the accompanying financials statements related to this litigation. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions | |
Related Party Transactions | 9. Related Party Transactions The Company paid legal fees and disbursements of approximately $150,000 and $81,000 in the nine month period ended September 30, 2020 and 2019, respectively, for services provided by a law firm that is owned by a member of the Company’s Board of Directors. Legal fees paid for the three month period ended September 30, 2020 and 2019 amounted to approximately $18,000 and $33,000, respectively. Additionally, the Company had accrued unbilled legal fees at September 30, 2020 and 2019 of approximately $25,000 and $49,000, respectively, with this firm. |
Business Segments
Business Segments | 9 Months Ended |
Sep. 30, 2020 | |
Business Segments | |
Business Segments | 10. Business Segments The Company operates in two business segments, ATG and CPG. The Company’s reportable segments are strategic business units that offer different products and services. The segments are composed of separate corporations and are managed separately. Operations in ATG primarily involve the design, manufacture, and marketing of servo-control components (i.e., torque motors, control valves, actuators, etc.) for government, commercial and industrial applications. CPG’s operations involve the design, manufacture and marketing of a variety of cutlery products for use by consumers and government agencies. The Company derives its primary sales revenue from domestic customers, although a portion of finished products are for foreign end use. As of September 30, 2020, the Company had identifiable assets of approximately $53,632,000 ($49,470,000 – December 31, 2019) of which approximately $43,531,000 ($39,980,000 – December 31, 2019) was for ATG and approximately $10,101,000 ($9,490,000 – December 31, 2019) was for CPG. Information regarding the Company’s operations in these segments is summarized as follows: ($000’s omitted except per share data) ATG CPG Consolidated Nine Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, 2020 2019 2020 2019 2020 2019 Revenues from unaffiliated customers $ 33,228 $ 33,926 $ 6,021 $ 4,506 $ 39,249 $ 38,432 Cost of goods sold, inclusive of depreciation (26,495) (24,400) (5,187) (5,155) (31,682) (29,555) Gross margin 6,733 9,526 834 (649) 7,567 8,877 Gross margin % 20.3 % 28.1 % 13.9 % (14.4) % 19.3 % 23.1 % Selling, general and administrative (4,857) (4,558) (1,255) (1,878) (6,112) (6,436) Interest (125) (66) (9) (22) (134) (88) Total costs and expenses (31,477) (29,024) (6,451) (7,055) (37,928) (36,079) Income before income tax provision 1,751 4,902 (430) (2,549) 1,321 2,353 Income tax provision (benefit) 318 852 (78) (443) 240 409 Net income (loss) $ 1,433 $ 4,050 $ (352) $ (2,106) $ 1,081 $ 1,944 Capital expenditures $ 640 $ 1,449 $ 68 $ 211 $ 708 $ 1,660 ($000’s omitted except per share data) ATG CPG Consolidated Three Months Ended Three Months Ended Three Months Ended September 30, September 30, September 30, 2020 2019 2020 2019 2020 2019 Revenues from unaffiliated customers $ 8,184 $ 11,180 $ 2,113 $ 1,182 $ 10,297 $ 12,362 Cost of goods sold, inclusive of depreciation (8,636) (7,378) (1,826) (1,449) (10,462) (8,827) Gross margin (452) 3,802 287 (267) (165) 3,535 Gross margin % (5.5) % 34.0 % 13.6 % (22.6) % (1.6) % 28.6 % Selling, general and administrative (1,712) (1,539) (384) (595) (2,096) (2,134) Interest (40) (25) (2) (6) (42) (31) Total costs and expenses (10,388) (8,942) (2,212) (2,050) (12,600) (10,992) Income before income tax provision (2,204) 2,238 (99) (868) (2,303) 1,370 Income tax provision (benefit) (512) 389 (9) (151) (521) 238 Net income (loss) $ (1,692) $ 1,849 $ (90) $ (717) $ (1,782) $ 1,132 Capital expenditures $ 99 $ 288 $ 16 $ 19 $ 115 $ 307 |
Business Description and Summ_2
Business Description and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Business Description and Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of Servotronics, Inc. and its wholly-owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated upon consolidation. |
Cash | Cash The Company considers cash to include all currency and coins owned by the Company as well as all deposits in the bank including checking accounts and savings accounts. |
Accounts Receivable | Accounts Receivable The Company grants credit to substantially all of its customers and carries its accounts receivable at original invoice amount less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on history of past write-offs, collections, and current credit conditions. The allowance for doubtful accounts amounted to approximately $188,000 at September 30, 2020 and $337,000 at December 31, 2019. The Company does not accrue interest on past due receivables. |
Revenue Recognition | Revenue Recognition Revenues are recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Purchase orders generally include specific terms relative to quantity, item description, specifications, price, customer responsibility for in-process costs, delivery schedule, shipping point, payment and other standard terms and conditions of purchase. Service sales, principally representing repair, are recognized at the time of shipment of goods. The costs incurred for nonrecurring engineering, development and repair activities of our products under agreements with commercial customers are expensed as incurred. Subsequently, the revenue is recognized as products are delivered to the customers with the approval by the customers. Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods and services to a customer. The Company determines revenue recognition using the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when the company satisfies a performance obligation. Revenue excludes taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer (e.g., sales and use taxes). Revenue includes payments for shipping activities that are reimbursed by the customer to the Company. Performance obligations are satisfied as of a point in time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract. As a significant portion of the Company’s revenue are recognized at the time of shipment, transfer of title and customer acceptance, there is no significant judgment applied to determine the timing of the satisfaction of performance obligations or transaction price. The timing of satisfaction of our performance obligations does not significantly vary from the typical timing of payment. The Company generally receives payment for these contracts within the payment terms negotiated and agreed upon by each customer contract. Warranty and repair obligations are assessed on all returns. Revenue is not recorded on any warranty returns. The Company warrants its products against design, materials and workmanship based on an average of twenty-seven months. The Company determines warranty reserves needed based on actual average costs of warranty units shipped and current facts and circumstances. As of September 30, 2020 and December 31, 2019 under the guidance of ASC460 the Company has recorded a warranty reserve of approximately $287,000 and $420,000, respectively. This amount is reflected in other accrued expenses in the accompanying consolidated balance sheets. Revenue is recognized on repair returns, covered under a customer contract, at the contractual price upon shipment to the customer. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost includes all costs incurred to bring each product to its present location and condition. Market provisions in respect of lower of cost or market adjustments and inventory expected to be used in greater than two years are applied to the gross value of the inventory through a reserve of approximately $1,677,000 and $1,437,000 at September 30, 2020 and December 31, 2019, respectively. Pre-production and start-up costs are expensed as incurred. The purchase of suppliers’ minimum economic quantities of material such as steel, etc. may result in a purchase of quantities exceeding one year of customer requirements. Also, in order to maintain a reasonable and/or agreed to lead time, certain larger quantities of other product support items may have to be purchased and may result in over one year’s supply. These amounts are not included in the inventory reserve discussed above. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling costs are classified as a component of cost of goods sold. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment is carried at cost; expenditures for new facilities and equipment and expenditures which substantially increase the useful lives of existing plant and equipment are capitalized; expenditures for maintenance and repairs are expensed as incurred. Upon disposal of properties, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposition is included in income. Depreciation is provided on the basis of estimated useful lives of depreciable properties, primarily by the straight-line method for financial statement purposes and by accelerated methods for income tax purposes. Depreciation expense includes the amortization of right-of-use (“ROU”) assets accounted for as finance leases. The estimated useful lives of depreciable properties are generally as follows: Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3‑5 years |
Income Taxes | Income Taxes For the Nine Months Ended September 30, 2020 2019 % Change ($000's omitted) Income tax expense $ 240 $ 409 (41.3) % Effective tax rate 18.2 % 17.4 % 0.8 % The higher effective tax rate during the nine months ended September 30, 2020 was primarily due to a decrease in permanent deductible expenses. In response to COVID-19, the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act) was signed into law on March 27, 2020. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding the prior and future utilization of net operating losses, temporary suspension of certain payment requirements for the employer portion of Social Security taxes, technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property, and the creation of certain refundable employee retention credits. The Company is currently evaluating the impact of these measures on its consolidated financial statements. If these measures are determined to be applicable to the Company, they may result in cash refunds and an income tax benefit recorded in the consolidated statement of operations. The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, as well as operating loss and credit carryforwards. The Company and its subsidiaries file a consolidated federal income tax return, combined New York and Texas state income tax returns and various separate state income tax returns. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at September 30, 2020 or December 31, 2019, and did not recognize any interest and/or penalties in its consolidated statements of operations during the nine months ended September 30, 2020 and 2019. The Company did not have any material uncertain tax positions or unrecognized tax benefits or obligations as of September 30, 2020 and December 31, 2019. On July 16, 2020, the Company was notified that the 2017 federal income tax return was randomly selected for examination. The 2016 through 2019 federal and state tax returns remain subject to examination. |
Supplemental Cash Flow Information | Supplemental Cash Flow Information Income taxes paid during the nine months ended September 30, 2020 and 2019 amounted to approximately $425,000 and $0, respectively. Interest paid during the nine months ended September 30, 2020 and 2019 amounted to approximately $116,000 and $88,000, respectively. |
Employee Stock Ownership Plan | Employee Stock Ownership Plan Contributions to the employee stock ownership plan are determined annually by the Company according to plan formula. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable based on undiscounted future operating cash flow analyses. If an impairment is determined to exist, any related impairment loss is calculated based on fair value. Due to the losses incurred by our Consumer Products Group ("CPG"), we performed a test for recoverability of the long-lived assets by comparing its carrying value to the future undiscounted cash flows that we expect will be generated by the asset group. Impairment losses on assets to be disposed of, if any, are based on the estimated proceeds to be received, less costs of disposal. The Company has determined that no impairment of long-lived assets existed at September 30, 2020 and December 31, 2019. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Reclassifications | Reclassifications Certain balances, as previously reported, were reclassified to conform to classifications adopted in the current period. |
Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred. |
Concentration of Credit Risks | Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks principally consist of cash accounts in financial institutions. Although the accounts exceed the federally insured deposit amount, management does not anticipate nonperformance by the financial institutions. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amount of cash, accounts receivable, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. Based on variable interest rates and the borrowing rates currently available to the Company for loans similar to its long-term debt, the fair value approximates its carrying amount. |
Business Description and Summ_3
Business Description and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Business Description and Summary of Significant Accounting Policies | |
Schedule of estimated useful lives of property, plant and equipment | Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3‑5 years |
Summary of income tax | For the Nine Months Ended September 30, 2020 2019 % Change ($000's omitted) Income tax expense $ 240 $ 409 (41.3) % Effective tax rate 18.2 % 17.4 % 0.8 % |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventories | |
Schedule of inventories | September 30, December 31, 2020 2019 ($000’s omitted) Raw material and common parts $ 17,599 $ 14,707 Work-in-process 4,700 4,158 Finished goods 4,531 2,723 26,830 21,588 Less inventory reserve (1,677) (1,437) Total inventories $ 25,153 $ 20,151 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property, Plant and Equipment | |
Schedule of property, plant and equipment | September 30, December 31, 2020 2019 ($000’s omitted) Land $ 7 $ 7 Buildings 11,641 11,017 Machinery, equipment and tooling 20,820 20,695 Construction in progress 222 331 32,690 32,050 Less accumulated depreciation and amortization (20,330) (19,333) Total property, plant and equipment $ 12,360 $ 12,717 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Long-Term Debt | |
Schedule of long-term debt | September 30, December 31, 2020 2019 ($000’s omitted) Paycheck protection progam payable to financial institutions: Interest rate of 1% per annum. Unforgiven portion is payable monthly until April 20, 2022 (A) $ 4,000 $ — Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B)(C) 3,750 3,000 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September30, 2020), monthly principal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021(C). 1,114 1,310 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September 30, 2020), monthly principal payments of $23,810 through December 1, 2021(C). 357 571 Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) 569 670 Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) 349 468 10,139 6,019 Less current portion (849) (849) $ 9,290 $ 5,170 A.) On April 21, 2020, the Company executed a promissory note (the "Note") in the amount of $4,000,000 as part of the Paycheck Protection Program (the "PPP Loan") administered by the Small Business Administration (the "SBA") and authorized under the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act"). The PPP Loan is being made through the Bank of America, NA (the "Lender"). The term of the PPP Loan is two years with an annual interest rate of 1.00%. Payments on the unforgiven amount of principal, if any, and interest on the PPP Loan will be deferred until the date on which loan forgiveness is determined or 10 months after the end of the borrower's covered period if forgiveness is not requested.“ B.) As of March 20, 2020, the Company increased its line of credit from $4,000,000 to $6,000,000. As of July 31, 2020, the Company extended the line of credit to expire December 21, 2022. As of July 31, 2020, the interest rate is a rate per year equal to the bank’s prime rate or Libor plus 1.65%. In addition, the Company is required to pay a commitment fee of 0.25% per year on the unused portion of the line of credit. There was $3,750,000 balance outstanding at September 30, 2020 and $3,000,000 balance at December 31, 2019. C.) The term loans and line of credit are secured by all personal property of the Company with the exception of certain equipment that was purchased from proceeds of government grants. Certain lenders require the Company to comply with debt covenants as described in the specific loan documents, including a debt service ratio. At September 30, 2020 and December 31, 2019 the Company was in compliance with these covenants. D.) The Company had an equipment loan facility in the amount of $2,500,000 available until November 30, 2019. This line was non-revolving and non-renewable. The Company used approximately $721,000 of the available funds for the purchase of machinery and equipment. The loan term for the equipment covered by the agreement is 60 months. Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding. There was approximately $569,000 outstanding at September 30, 2020 and $670,000 at December 31, 2019. E.) The Company established a lease line of credit for equipment financing in the amount of $1,000,000 available until June 28, 2018. This line was non-revolving and non-renewable. The lease term for equipment covered by the lease line of credit is 60 months. Monthly payments are fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding. There was approximately $349,000 outstanding at September 30, 2020 and $468,000 at December 31, 2019. |
Schedule of payments for capital lease obligations | September 30, December 31, Year 2020 2019 ($000’s omitted) 2020 $ 83 $ 331 2021 331 331 2022 316 316 2023 169 169 2024 97 97 Total principal and interest payments 996 1,244 Less amount representing interest (78) (106) Present value of net minimum lease payments 918 1,138 Less current portion (301) (301) Long term principle payments $ 617 $ 837 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Shareholders' Equity | |
Schedule of stockholders equity | Nine-month Period Ended September 30, 2020 Accumulated Other Capital in Total Retained Comprehensive excess of Treasury shareholders’ Earnings Income Common Stock par value ESOT stock equity January 1, 2020 $ 20,484 $ 98 $ 523 $ 14,358 $ (460) $ (1,471) $ 33,532 Purchase of treasury shares — — — — — (100) (100) Stock based compensation — — — 33 — 52 85 Net Income 1,898 — — — — — 1,898 March 31, 2020 $ 22,382 $ 98 $ 523 $ 14,391 $ (460) $ (1,519) $ 35,415 Stock based compensation — — — 39 — 48 87 Net Income 965 — — — — — 965 June 30, 2020 $ 23,347 $ 98 $ 523 $ 14,430 $ (460) $ (1,471) $ 36,467 Stock based compensation — — — 29 — 54 83 Net Loss (1,782) — — — — — (1,782) September 30, 2020 $ 21,565 $ 98 $ 523 $ 14,459 $ (460) $ (1,417) $ 34,768 Nine-month Period Ended September 30, 2019 Accumulated Other Capital in Total Retained Comprehensive excess of Treasury shareholders’ Earnings Income Common Stock par value ESOT stock equity January 1, 2019 $ 18,788 $ 35 $ 523 $ 14,250 $ (561) $ (1,522) $ 31,513 Purchase of treasury shares — — — — — (128) (128) Stock based compensation — — — 14 — 44 58 Net Income 98 — — — — — 98 March 31, 2019 $ 18,886 $ 35 $ 523 $ 14,264 $ (561) $ (1,606) $ 31,541 Dividends declared ($0.16 per share) (413) — — — — — (413) Purchase of treasury shares — — — — — (21) (21) Stock based compensation — — — 34 — 61 95 Net Income 714 — — — — — 714 June 30, 2019 $ 19,187 $ 35 $ 523 $ 14,298 $ (561) $ (1,566) $ 31,916 Purchase of treasury shares — — — — — (8) (8) Stock based compensation — — — 28 — 58 86 Net Income 1,132 — — — — — 1,132 September 30, 2019 $ 20,319 $ 35 $ 523 $ 14,326 $ (561) $ (1,516) $ 33,126 |
Summary of restricted stock activity | Shares Unvested at December 31, 2019 54,416 Granted 11,328 Forfeited — Vested 31,998 Unvested at September 30, 2020 33,746 |
Schedule of earnings per share | Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 ($000’s omitted except per share data) Net (Loss) Income $ (1,782) $ 1,132 $ 1,081 $ 1,944 Weighted average common shares outstanding (basic) 2,363 2,327 2,358 2,325 Unvested restricted stock 34 58 34 58 Weighted average common shares outstanding (diluted) 2,397 2,385 2,392 2,383 Basic Net (loss) income per share $ (0.75) $ 0.49 $ 0.46 $ 0.84 Diluted Net (loss) income per share $ (0.75) $ 0.47 $ 0.45 $ 0.82 |
Business Segments (Tables)
Business Segments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Business Segments | |
Schedule of information regarding operations in business segment | ($000’s omitted except per share data) ATG CPG Consolidated Nine Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, 2020 2019 2020 2019 2020 2019 Revenues from unaffiliated customers $ 33,228 $ 33,926 $ 6,021 $ 4,506 $ 39,249 $ 38,432 Cost of goods sold, inclusive of depreciation (26,495) (24,400) (5,187) (5,155) (31,682) (29,555) Gross margin 6,733 9,526 834 (649) 7,567 8,877 Gross margin % 20.3 % 28.1 % 13.9 % (14.4) % 19.3 % 23.1 % Selling, general and administrative (4,857) (4,558) (1,255) (1,878) (6,112) (6,436) Interest (125) (66) (9) (22) (134) (88) Total costs and expenses (31,477) (29,024) (6,451) (7,055) (37,928) (36,079) Income before income tax provision 1,751 4,902 (430) (2,549) 1,321 2,353 Income tax provision (benefit) 318 852 (78) (443) 240 409 Net income (loss) $ 1,433 $ 4,050 $ (352) $ (2,106) $ 1,081 $ 1,944 Capital expenditures $ 640 $ 1,449 $ 68 $ 211 $ 708 $ 1,660 ($000’s omitted except per share data) ATG CPG Consolidated Three Months Ended Three Months Ended Three Months Ended September 30, September 30, September 30, 2020 2019 2020 2019 2020 2019 Revenues from unaffiliated customers $ 8,184 $ 11,180 $ 2,113 $ 1,182 $ 10,297 $ 12,362 Cost of goods sold, inclusive of depreciation (8,636) (7,378) (1,826) (1,449) (10,462) (8,827) Gross margin (452) 3,802 287 (267) (165) 3,535 Gross margin % (5.5) % 34.0 % 13.6 % (22.6) % (1.6) % 28.6 % Selling, general and administrative (1,712) (1,539) (384) (595) (2,096) (2,134) Interest (40) (25) (2) (6) (42) (31) Total costs and expenses (10,388) (8,942) (2,212) (2,050) (12,600) (10,992) Income before income tax provision (2,204) 2,238 (99) (868) (2,303) 1,370 Income tax provision (benefit) (512) 389 (9) (151) (521) 238 Net income (loss) $ (1,692) $ 1,849 $ (90) $ (717) $ (1,782) $ 1,132 Capital expenditures $ 99 $ 288 $ 16 $ 19 $ 115 $ 307 |
Business Description and Summ_4
Business Description and Summary of Significant Accounting Policies - Estimated useful lives of depreciable properties (Details) | 9 Months Ended |
Sep. 30, 2020 | |
Buildings and improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 5 years |
Buildings and improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 40 years |
Machinery, equipment and tooling | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 5 years |
Machinery, equipment and tooling | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 20 years |
Tooling | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 3 years |
Tooling | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives of depreciable properties | 5 years |
Business Description and Summ_5
Business Description and Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Business Description and Summary of Significant Accounting Policies | ||||
Income tax expense | $ (521) | $ 238 | $ 240 | $ 409 |
Income Tax Expense (% Change) | (41.30%) | |||
Effective tax rate | 18.20% | 17.40% | ||
Effective tax rate (% Change) | 0.80% |
Business Description and Summ_6
Business Description and Summary of Significant Accounting Policies - Additional Information (Details) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020USD ($)Y | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Allowance for doubtful accounts | $ 188,000 | $ 337,000 | |
Warranty period | 27 months | ||
Warranty reserve | $ 287,000 | 420,000 | |
Inventory reserve | 1,677,000 | 1,437,000 | |
Income taxes paid | 425,000 | $ 0 | |
Interest paid | 116,000 | $ 88,000 | |
Impairment of long-lived assets | $ 0 | $ 0 | |
Minimum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Period inventory is expected to be used | 2 years | ||
Number of years of customer requirements | Y | 1 | ||
Number of year's supply | Y | 1 |
Inventories - Summary of invent
Inventories - Summary of inventories (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Inventories | ||
Raw material and common parts | $ 17,599,000 | $ 14,707,000 |
Work-in-process | 4,700,000 | 4,158,000 |
Finished goods | 4,531,000 | 2,723,000 |
Inventory, Gross | 26,830,000 | 21,588,000 |
Less inventory reserve | (1,677,000) | (1,437,000) |
Total inventories | $ 25,153,000 | $ 20,151,000 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of property, plant and equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 32,690 | $ 32,050 |
Less accumulated depreciation and amortization | (20,330) | (19,333) |
Total property, plant and equipment | 12,360 | 12,717 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 7 | 7 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 11,641 | 11,017 |
Machinery, equipment and tooling | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 20,820 | 20,695 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 222 | $ 331 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||||
Depreciation and amortization expense | $ 356,000 | $ 339,000 | $ 1,072,000 | $ 902,000 | |
Amortization expense | 15,000 | $ 18,000 | 50,000 | $ 59,000 | |
Construction in progress | 222,000 | 222,000 | $ 331,000 | ||
Property, plant and equipment, Gross | 32,690,000 | 32,690,000 | $ 32,050,000 | ||
Construction in progress (CIP) machinery & equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, Gross | 192,000 | 192,000 | |||
Construction in progress (CIP) building improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, Gross | 22,000 | 22,000 | |||
Construction in progress (CIP) IT equipment and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, Gross | $ 8,000 | $ 8,000 |
Long-Term Debt - Summary of lon
Long-Term Debt - Summary of long term debt (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Debt Instrument | ||
Long-term debt | $ 10,139,000 | $ 6,019,000 |
Less current portion | (849,000) | (849,000) |
Long-term debt, Noncurrent | 9,290,000 | 5,170,000 |
Paycheck Protection Program Loan [Member] | ||
Debt Instrument | ||
Long-term debt | 4,000,000 | 0 |
Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B) | ||
Debt Instrument | ||
Long-term debt | 3,750,000 | 3,000,000 |
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September30, 2020), monthly principal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021(C). | ||
Debt Instrument | ||
Long-term debt | 1,114,000 | 1,310,000 |
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September 30, 2020), monthly principal payments of $23,810 through December 1, 2021(C). | ||
Debt Instrument | ||
Long-term debt | 357,000 | 571,000 |
Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) | ||
Debt Instrument | ||
Long-term debt | 569,000 | 670,000 |
Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) | ||
Debt Instrument | ||
Long-term debt | $ 349,000 | $ 468,000 |
Long-Term Debt - Summary of l_2
Long-Term Debt - Summary of long term debt information (Details) - USD ($) | Jul. 31, 2020 | Sep. 30, 2020 |
Paycheck Protection Program Loan [Member] | ||
Debt Instrument | ||
Percentage of fixed interest rate payable | 1.00% | |
Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B) | ||
Debt Instrument | ||
Spread on variable rate | 1.65% | |
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September30, 2020), monthly principal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021(C). | ||
Debt Instrument | ||
Monthly principal payments | $ 21,833 | |
Balloon payment due December 1, 2021 | $ 786,000 | |
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September 30, 2020), monthly principal payments of $23,810 through December 1, 2021(C). | ||
Debt Instrument | ||
Spread on variable rate | 1.40% | |
Monthly principal payments | $ 23,810 | |
Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) | Minimum | ||
Debt Instrument | ||
Percentage of floating interest rate payable | 1.8259% | |
Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) | Maximum | ||
Debt Instrument | ||
Percentage of floating interest rate payable | 1.83501% | |
Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) | Minimum | ||
Debt Instrument | ||
Percentage of floating interest rate payable | 1.82276% | |
Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) | Maximum | ||
Debt Instrument | ||
Percentage of floating interest rate payable | 1.8693% | |
LIBOR | Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B) | ||
Debt Instrument | ||
Spread on variable rate | 1.65% | |
LIBOR | Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (1.556% as of September30, 2020), monthly principal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021(C). | ||
Debt Instrument | ||
Spread on variable rate | 1.40% |
Long-Term Debt - Maturities (De
Long-Term Debt - Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Maturities - Topic 842 | ||
2020 | $ 83 | $ 331 |
2021 | 331 | 331 |
2022 | 316 | 316 |
2023 | 169 | 169 |
2024 | 97 | 97 |
Total principal and interest payments | 996 | 1,244 |
Less amount representing interest | (78) | (106) |
Present value of net minimum lease payments | 918 | 1,138 |
Less current portion | (301) | (301) |
Long term principle payments | $ 617 | $ 837 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) - USD ($) | Jul. 31, 2020 | Apr. 21, 2020 | Sep. 30, 2020 | Mar. 20, 2020 | Mar. 19, 2020 | Dec. 31, 2019 |
Debt Instrument | ||||||
Loan term for equipment covered by loan | 60 months | |||||
Lease line of credit | $ 1,000,000 | |||||
Long-term debt | 10,139,000 | $ 6,019,000 | ||||
Principal maturities of long-term debt for 2020 | 219,000 | |||||
Principal maturities of long-term debt for 2021 | 1,635,000 | |||||
Principal maturities of long-term debt for 2022 | 4,038,000 | |||||
Principal maturities of long-term debt for 2023 | 154,000 | |||||
Principal maturities of long-term debt for 2024 | $ 93,000 | |||||
Paycheck Protection Program Loan [Member] | ||||||
Debt Instrument | ||||||
Debt Instrument, Face Amount | $ 4,000,000 | |||||
Debt Instrument, Term | 2 years | |||||
Percentage of fixed interest rate payable | 1.00% | |||||
Lease term for equipment covered by lease line of credit | 2 years | |||||
Line of credit payable to a financial institution; Interest rate option of bank prime or Libor plus 1.65% (B) | ||||||
Debt Instrument | ||||||
Maximum borrowing capacity | $ 6,000,000 | $ 4,000,000 | ||||
Spread on variable rate | 1.65% | |||||
Commitment fee on unused portion of line of credit | 0.25% | |||||
Balance outstanding of line of credit | $ 3,750,000 | 3,000,000 | ||||
Long-term debt | 3,750,000 | 3,000,000 | ||||
Equipment note obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.8259% - 1.835015% as of June 30, 2020)(D) | ||||||
Debt Instrument | ||||||
Maximum borrowing capacity | 2,500,000 | |||||
Balance outstanding of line of credit | $ 569,000 | 670,000 | ||||
Loan term for equipment covered by loan | 60 months | |||||
Payments for purchase of machinery and equipment | $ 721,000 | |||||
Long-term debt | $ 569,000 | 670,000 | ||||
Equipment financing lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding)(E) | ||||||
Debt Instrument | ||||||
Debt Instrument, Term | 60 months | |||||
Lease line of credit | $ 1,000,000 | |||||
Lease term for equipment covered by lease line of credit | 60 months | |||||
Long-term debt | $ 349,000 | $ 468,000 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of common shareholders' equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | $ 36,467 | $ 35,415 | $ 33,532 | $ 31,916 | $ 31,541 | $ 31,513 | $ 33,532 | $ 31,513 |
Dividends declared ($0.16 per share) | (413) | |||||||
Purchase of treasury shares | (100) | (8) | (21) | (128) | ||||
Stock based compensation | 83 | 87 | 85 | 86 | 95 | 58 | ||
Net income (loss) | (1,782) | 965 | 1,898 | 1,132 | 714 | 98 | 1,081 | 1,944 |
Balance | 34,768 | 36,467 | 35,415 | 33,126 | 31,916 | 31,541 | 34,768 | 33,126 |
Retained earnings | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | 23,347 | 22,382 | 20,484 | 19,187 | 18,886 | 18,788 | 20,484 | 18,788 |
Dividends declared ($0.16 per share) | (413) | |||||||
Purchase of treasury shares | 0 | 0 | 0 | 0 | ||||
Stock based compensation | 0 | 0 | 0 | 0 | 0 | 0 | ||
Net income (loss) | (1,782) | 965 | 1,898 | 1,132 | 714 | 98 | ||
Balance | 21,565 | 23,347 | 22,382 | 20,319 | 19,187 | 18,886 | 21,565 | 20,319 |
Accumulated Other Comprehensive Income (Loss) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | 98 | 98 | 98 | 35 | 35 | 35 | 98 | 35 |
Dividends declared ($0.16 per share) | 0 | |||||||
Purchase of treasury shares | 0 | 0 | 0 | 0 | ||||
Stock based compensation | 0 | 0 | 0 | 0 | 0 | 0 | ||
Net income (loss) | 0 | 0 | 0 | 0 | 0 | 0 | ||
Balance | 98 | 98 | 98 | 35 | 35 | 35 | 98 | 35 |
Common Stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | 523 | 523 | 523 | 523 | 523 | 523 | 523 | 523 |
Dividends declared ($0.16 per share) | 0 | |||||||
Purchase of treasury shares | 0 | 0 | 0 | 0 | ||||
Stock based compensation | 0 | 0 | 0 | 0 | 0 | 0 | ||
Net income (loss) | 0 | 0 | 0 | 0 | 0 | 0 | ||
Balance | 523 | 523 | 523 | 523 | 523 | 523 | 523 | 523 |
Capital in excess of par value | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | 14,430 | 14,391 | 14,358 | 14,298 | 14,264 | 14,250 | 14,358 | 14,250 |
Dividends declared ($0.16 per share) | 0 | |||||||
Purchase of treasury shares | 0 | 0 | 0 | 0 | ||||
Stock based compensation | 29 | 39 | 33 | 28 | 34 | 14 | ||
Net income (loss) | 0 | 0 | 0 | 0 | 0 | 0 | ||
Balance | 14,459 | 14,430 | 14,391 | 14,326 | 14,298 | 14,264 | 14,459 | 14,326 |
ESOT | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | (460) | (460) | (460) | (561) | (561) | (561) | (460) | (561) |
Dividends declared ($0.16 per share) | 0 | |||||||
Purchase of treasury shares | 0 | 0 | 0 | 0 | ||||
Stock based compensation | 0 | 0 | 0 | 0 | 0 | 0 | ||
Net income (loss) | 0 | 0 | 0 | 0 | 0 | 0 | ||
Balance | (460) | (460) | (460) | (561) | (561) | (561) | (460) | (561) |
Treasury stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance | (1,471) | (1,519) | (1,471) | (1,566) | (1,606) | (1,522) | (1,471) | (1,522) |
Dividends declared ($0.16 per share) | 0 | |||||||
Purchase of treasury shares | (100) | (8) | (21) | (128) | ||||
Stock based compensation | 54 | 48 | 52 | 58 | 61 | 44 | ||
Net income (loss) | 0 | 0 | 0 | 0 | 0 | 0 | ||
Balance | $ (1,417) | $ (1,471) | $ (1,519) | $ (1,516) | $ (1,566) | $ (1,606) | $ (1,417) | $ (1,516) |
Shareholders' Equity - Restrict
Shareholders' Equity - Restricted stock activity (Details) | 9 Months Ended |
Sep. 30, 2020shares | |
Restricted Share Activity: | |
Unvested at the beginning | 54,416 |
Granted | 11,328 |
Vested | 31,998 |
Unvested at the end | 33,746 |
Amortization period | 3 years |
Shares withheld to satisfy the tax obligations | 9,543 |
Shareholders' Equity - Calculat
Shareholders' Equity - Calculation of earning per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Shareholders' Equity | ||||||||
Net (Loss) Income | $ (1,782) | $ 965 | $ 1,898 | $ 1,132 | $ 714 | $ 98 | $ 1,081 | $ 1,944 |
Weighted average common shares outstanding (basic) (in shares) | 2,363 | 2,327 | 2,358 | 2,325 | ||||
Unvested restricted stock (in shares) | 34 | 58 | 34 | 58 | ||||
Weighted average common shares outstanding (diluted) (in shares) | 2,397 | 2,385 | 2,392 | 2,383 | ||||
Basic | ||||||||
Net (loss) income per share | $ (0.75) | $ 0.49 | $ 0.46 | $ 0.84 | ||||
Diluted | ||||||||
Net (loss) income per share | $ (0.75) | $ 0.47 | $ 0.45 | $ 0.82 |
Shareholders' Equity - Share Re
Shareholders' Equity - Share Repurchase Program (Details) - Share Repurchase Program - shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Equity, Class of Treasury Stock [Line Items] | ||
Number of common shares authorized to be purchased | 450,000 | |
Number of shares purchased | 360,615 | |
Remaining number of shares authorized to be purchased | 89,385 | |
Shares purchased | 360 | 5,232 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Loss Contingencies [Line Items] | ||
Post retirement obligation | $ 1,724,000 | $ 1,543,000 |
Kenneth Trbovich | Employment Agreement | ||
Loss Contingencies [Line Items] | ||
Post retirement obligation | $ 699,000 | $ 583,000 |
Minimum age limit | 65 years |
Litigation (Details)
Litigation (Details) - Aero, Inc. | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Litigation | |
Amount of alleged damages | $ 3,000,000 |
Amount of counter claim | 3,191,000 |
Gain or loss on litigation | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Related Party Transactions | ||||
Legal fees and disbursements | $ 18,000 | $ 33,000 | $ 150,000 | $ 81,000 |
Accrued additional legal fees | $ 25,000 | $ 49,000 | $ 25,000 | $ 49,000 |
Business Segments - Summary of
Business Segments - Summary of company's operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||||||
Revenues from unaffiliated customers | $ 10,297 | $ 12,362 | $ 39,249 | $ 38,432 | ||||
Cost of goods sold, inclusive of depreciation | (10,462) | (8,827) | (31,682) | (29,555) | ||||
Gross margin | (165) | 3,535 | 7,567 | 8,877 | ||||
Selling, general and administrative | (2,096) | (2,134) | (6,112) | (6,436) | ||||
Interest | (42) | (31) | (134) | (88) | ||||
Total costs and expenses | (2,138) | (2,165) | (6,246) | (6,524) | ||||
Income before income tax provision | (2,303) | 1,370 | 1,321 | 2,353 | ||||
Income tax provision (benefit) | (521) | 238 | 240 | 409 | ||||
Net income (loss) | (1,782) | $ 965 | $ 1,898 | 1,132 | $ 714 | $ 98 | 1,081 | 1,944 |
Capital expenditures | 708 | 1,660 | ||||||
Operating Segments | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenues from unaffiliated customers | 10,297 | 12,362 | 39,249 | 38,432 | ||||
Cost of goods sold, inclusive of depreciation | (10,462) | (8,827) | (31,682) | (29,555) | ||||
Gross margin | $ (165) | $ 3,535 | $ 7,567 | $ 8,877 | ||||
Gross margin % | (1.60%) | 28.60% | 19.30% | 23.10% | ||||
Selling, general and administrative | $ (2,096) | $ (2,134) | $ (6,112) | $ (6,436) | ||||
Interest | (42) | (31) | (134) | (88) | ||||
Total costs and expenses | (12,600) | (10,992) | (37,928) | (36,079) | ||||
Income before income tax provision | (2,303) | 1,370 | 1,321 | 2,353 | ||||
Income tax provision (benefit) | (521) | 238 | 240 | 409 | ||||
Net income (loss) | (1,782) | 1,132 | 1,081 | 1,944 | ||||
Capital expenditures | 115 | 307 | 708 | 1,660 | ||||
Operating Segments | ATG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenues from unaffiliated customers | 8,184 | 11,180 | 33,228 | 33,926 | ||||
Cost of goods sold, inclusive of depreciation | (8,636) | (7,378) | (26,495) | (24,400) | ||||
Gross margin | $ (452) | $ 3,802 | $ 6,733 | $ 9,526 | ||||
Gross margin % | (5.50%) | 34.00% | 20.30% | 28.10% | ||||
Selling, general and administrative | $ (1,712) | $ (1,539) | $ (4,857) | $ (4,558) | ||||
Interest | (40) | (25) | (125) | (66) | ||||
Total costs and expenses | (10,388) | (8,942) | (31,477) | (29,024) | ||||
Income before income tax provision | (2,204) | 2,238 | 1,751 | 4,902 | ||||
Income tax provision (benefit) | (512) | 389 | 318 | 852 | ||||
Net income (loss) | (1,692) | 1,849 | 1,433 | 4,050 | ||||
Capital expenditures | 99 | 288 | 640 | 1,449 | ||||
Operating Segments | CPG | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Revenues from unaffiliated customers | 2,113 | 1,182 | 6,021 | 4,506 | ||||
Cost of goods sold, inclusive of depreciation | (1,826) | (1,449) | (5,187) | (5,155) | ||||
Gross margin | $ 287 | $ (267) | $ 834 | $ (649) | ||||
Gross margin % | 13.60% | (22.60%) | 13.90% | (14.40%) | ||||
Selling, general and administrative | $ (384) | $ (595) | $ (1,255) | $ (1,878) | ||||
Interest | (2) | (6) | (9) | (22) | ||||
Total costs and expenses | (2,212) | (2,050) | (6,451) | (7,055) | ||||
Income before income tax provision | (99) | (868) | (430) | (2,549) | ||||
Income tax provision (benefit) | (9) | (151) | (78) | (443) | ||||
Net income (loss) | (90) | (717) | (352) | (2,106) | ||||
Capital expenditures | $ 16 | $ 19 | $ 68 | $ 211 |
Business Segments - Additional
Business Segments - Additional Information (Details) | 9 Months Ended | |
Sep. 30, 2020USD ($)segment | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | segment | 2 | |
Total identifiable assets | $ 53,632,000 | $ 49,470,000 |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Total identifiable assets | 53,632,000 | 49,470,000 |
Operating Segments | ATG | ||
Segment Reporting Information [Line Items] | ||
Total identifiable assets | 43,531,000 | 39,980,000 |
Operating Segments | CPG | ||
Segment Reporting Information [Line Items] | ||
Total identifiable assets | $ 10,101,000 | $ 9,490,000 |