Document and Entity Information
Document and Entity Information | 12 Months Ended |
Mar. 31, 2020shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | DESWELL INDUSTRIES INC |
Entity Central Index Key | 0000946936 |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Current Fiscal Year End Date | --03-31 |
Entity Filer Category | Non-accelerated Filer |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Entity Well-Known Seasoned Issuer | No |
Entity Common Stock, Shares Outstanding | 15,915,239 |
Document Type | 20-F |
Document Period End Date | Mar. 31, 2020 |
Amendment Flag | false |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Entity Interactive Data Current | Yes |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Incorporation State Country Code | D8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 22,514 | $ 14,371 |
Time deposits maturing over three months | 783 | 371 |
Marketable securities (note 3) | 19,441 | 24,446 |
Accounts receivable, less allowances for doubtful accounts of $658 and $954 at March 31, 2019 and 2020, respectively | 12,301 | 15,734 |
Inventories (note 4) | 8,578 | 13,030 |
Prepaid expenses and other current assets (note 5) | 1,752 | 2,006 |
Total current assets | 65,369 | 69,958 |
Property, plant and equipment, net (note 6) | 28,586 | 30,211 |
Goodwill (note 2) | ||
Time deposits maturing over twelve months | 1,424 | |
Total assets | 95,379 | 100,169 |
Current liabilities: | ||
Accounts payable | 4,604 | 6,253 |
Accrued payroll and employee benefits | 6,077 | 5,676 |
Customer deposits | 1,172 | 1,298 |
Other accrued liabilities (note 7) | 1,718 | 1,662 |
Income taxes payable | 735 | 657 |
Total current liabilities | 14,306 | 15,546 |
Deferred income tax liabilities (note 8) | 751 | 659 |
Total liabilities | 15,057 | 16,205 |
Commitments and contingencies (note 10) | ||
Shareholders' equity: | ||
Common shares nil par value; authorized 30,000,000 shares; 17,031,810 and 17,061,810 shares issued as of March 31, 2019 and 2020, respectively; 15,885,239 and 15,915,239 shares outstanding as of March 31, 2019 and 2020, respectively | 53,143 | 53,063 |
Treasury stock at cost; 1,146,571 shares as of March 31, 2019 and 2020 (note 12) | (2,821) | (2,821) |
Additional paid-in capital | 7,989 | 8,005 |
Accumulated other comprehensive income | 5,316 | 5,316 |
Retained earnings | 16,695 | 20,401 |
Total shareholders' equity | 80,322 | 83,964 |
Total liabilities and shareholders' equity | $ 95,379 | $ 100,169 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Allowances for doubtful accounts | $ 954 | $ 658 |
Common shares, no par value | $ 0 | $ 0 |
Common shares, authorized | 30,000,000 | 30,000,000 |
Common shares, issued | 17,061,810 | 17,031,810 |
Common shares, outstanding | 15,915,239 | 15,885,239 |
Treasury stock, at cost | 1,146,571 | 1,146,571 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Income Statement [Abstract] | |||
Net sales | $ 65,368 | $ 66,581 | $ 60,667 |
Cost of sales | 53,504 | 56,311 | 50,953 |
Gross profit | 11,864 | 10,270 | 9,714 |
Selling, general and administrative expenses | 10,026 | 9,459 | 8,806 |
Other income (expenses), net | (425) | (278) | 894 |
Operating income | 1,413 | 533 | 1,802 |
Non-operating income (expenses), net | (2,360) | 3,884 | 4,395 |
Income (loss), before income taxes | (947) | 4,417 | 6,197 |
Income taxes | 373 | 144 | 7 |
Net income (loss) attribute to Deswell Industries, Inc. | (1,320) | 4,273 | 6,190 |
Other comprehensive income (loss) | |||
Total comprehensive income (loss) attributable to Deswell Industries, Inc. | $ (1,320) | $ 4,273 | $ 6,190 |
Basic: | |||
Net income (loss) per share | $ (0.08) | $ 0.27 | $ 0.39 |
Weighted average common shares outstanding (shares in thousands) | 15,914 | 15,885 | 15,885 |
Diluted: | |||
Net income (loss) per share | $ (0.08) | $ 0.27 | $ 0.39 |
Weighted average common shares outstanding (shares in thousands) | 15,914 | 16,059 | 15,985 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-In Capital [Member] | Accumulated Other Comprehensive Income [Member] | Retained Earnings [Member] | Total |
Balance at Mar. 31, 2017 | $ 53,063 | $ (2,821) | $ 8,005 | $ 5,316 | $ 12,638 | $ 76,201 |
Balance (in shares) at Mar. 31, 2017 | 17,031,810 | |||||
Balance (in shares) at Mar. 31, 2017 | (1,146,571) | |||||
Exercise of stock options, shares | ||||||
Net income (loss) | 6,190 | $ 6,190 | ||||
Dividends ($0.07, $0.1 and $0.15 per share for March 31, 2017, March 31, 2018 and March 31, 2019 respectively) | (1,112) | (1,112) | ||||
Balance at Mar. 31, 2018 | $ 53,063 | $ (2,821) | 8,005 | 5,316 | 17,716 | $ 81,279 |
Balance (in shares) at Mar. 31, 2018 | 17,031,810 | |||||
Balance (in shares) at Mar. 31, 2018 | (1,146,571) | |||||
Exercise of stock options, shares | ||||||
Net income (loss) | 4,273 | $ 4,273 | ||||
Dividends ($0.07, $0.1 and $0.15 per share for March 31, 2017, March 31, 2018 and March 31, 2019 respectively) | (1,588) | (1,588) | ||||
Balance at Mar. 31, 2019 | $ 53,063 | $ (2,821) | 8,005 | 5,316 | 20,401 | $ 83,964 |
Balance (in shares) at Mar. 31, 2019 | 17,031,810 | |||||
Balance (in shares) at Mar. 31, 2019 | (1,146,571) | (1,146,571) | ||||
Exercise of stock options, value | $ 80 | (16) | $ 64 | |||
Exercise of stock options, shares | 30,000 | 30,000 | ||||
Net income (loss) | (1,320) | $ (1,320) | ||||
Dividends ($0.07, $0.1 and $0.15 per share for March 31, 2017, March 31, 2018 and March 31, 2019 respectively) | (2,386) | (2,386) | ||||
Balance at Mar. 31, 2020 | $ 53,143 | $ (2,821) | $ 7,989 | $ 5,316 | $ 16,695 | $ 80,322 |
Balance (in shares) at Mar. 31, 2020 | 17,061,810 | |||||
Balance (in shares) at Mar. 31, 2020 | (1,146,571) | (1,146,571) |
CONSOLIDATED STATEMENTS OF SH_2
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | |||
Dividends | $ 0.15 | $ .1 | $ 0.07 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities | |||
Net income (loss) | $ (1,320) | $ 4,273 | $ 6,190 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 1,973 | 2,114 | 2,138 |
Reversal of (provision for) doubtful accounts, net | 297 | 403 | (674) |
Additional charges for obsolescence allowance of inventories, net | 426 | 256 | 296 |
Loss (gain) on disposal of property, plant and equipment | (29) | 22 | 61 |
Unrealized holding (gain) loss on marketable securities | 5,179 | (891) | (1,401) |
Gain on sales of marketable securities | (29) | (746) | (609) |
Deferred income tax (benefit) expense | 92 | (116) | (114) |
Scrip dividend received | (175) | (33) | (168) |
Exchange loss arising from marketable securities | 531 | ||
Changes in operating assets and liabilities: | |||
Accounts receivable | 3,136 | (225) | (2,079) |
Inventories | 4,026 | (353) | (2,541) |
Prepaid expenses and other current assets | 254 | 261 | 152 |
Accounts payable | (1,649) | (2,343) | 3,444 |
Accrued payroll and employee benefits | 401 | 110 | 923 |
Customer deposits | (126) | (409) | (445) |
Other accrued liabilities | 56 | (211) | 399 |
Income taxes payable | 78 | 54 | 127 |
Net cash provided by operating activities | 13,121 | 2,166 | 5,699 |
Cash flows from investing activities | |||
Purchase of property, plant and equipment | (507) | (878) | (1,707) |
Proceeds from sale of property, plant and equipment, net of transaction costs | 188 | 25 | 6 |
Purchase of marketable securities | (2,121) | (12,704) | (5,357) |
Proceeds from sales of marketable securities | 1,620 | 7,210 | 6,580 |
Withdrawal (increase) of fixed deposits maturing over three months | (412) | 1,819 | 3,232 |
(Increase) withdrawal of fixed deposits maturing over twelve months | (1,424) | 3,129 | (227) |
Net cash provided by (used in) investing activities | (2,656) | (1,399) | 2,527 |
Cash flows from financing activities | |||
Dividends paid | (2,386) | (1,588) | (1,112) |
Proceeds from exercise of stock options | 64 | ||
Net cash used in financing activities | (2,322) | (1,588) | (1,112) |
Net increase (decrease) in cash and cash equivalents | 8,143 | (821) | 7,114 |
Cash and cash equivalents, beginning of year | 14,371 | 15,192 | 8,078 |
Cash and cash equivalents, end of year | 22,514 | 14,371 | 15,192 |
Cash paid during the year for: | |||
Interest | |||
Income taxes | $ 160 | $ 149 | $ 85 |
Organization and Basis of Finan
Organization and Basis of Financial Statements | 12 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Financial Statements | 1. Organization and Basis of Financial Statements Deswell Industries, Inc. was incorporated in the British Virgin Islands on December 2, 1993. The principal activities of the Company comprise the manufacturing and sales of injection-molded plastic parts and components and electronic products assembling. The manufacturing activities are subcontracted to subsidiaries operating in the People’s Republic of China (“PRC”). The selling and administrative activities were originally performed in the Hong Kong Special Administrative Region (“Hong Kong”) of the PRC. From August 2003, these activities were moved to the Macao Special Administrative Region (“Macao”) of the PRC. As the Company is a holding company, the amount of any dividends to be declared by the Company will be dependent upon the amount which can be distributed from its subsidiaries. Dividends from subsidiaries are declared based on profits as reported in their statutory accounts. COVID-19 Considerations In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China. The coronavirus, or 2019-nCoV, currently appears to be spreading at a fast rate, indicating its highly contagious nature. The coronavirus also displayed a longer incubation period and is contagious before symptoms appear. In reaction towards the outbreak of this new contagious disease defined as COVID-19, an increasing number of countries imposed travel suspensions to/from China following the World Health Organization’s “public health emergency of international concern” (PHEIC) announcement on January 30, 2020. In March 2020, the World Health Organization categorized the COVID-19 as a pandemic, and most of the world experienced the detrimental effects of this health crisis, including widespread economic shutdowns. For the month after the outbreak of COVID-19, domestic business activities in China had been disrupted by a series of emergency quarantine measures taken by the government. In February 2020, the Company’s plants in PRC were temporarily suspended for 1 to 2 weeks according to the instruction of the local government, related to the COVID-19. Emergency quarantine measures and travel restrictions caused business disruptions across China. The evolution of quarantine measures and travel restrictions resulted in negative consequences for our business operations including, but not limited to, the temporary closure of the Company’s factory and operations beginning in early February, limited support from the Company’s employees, delayed access to raw material supplies and inability to deliver products to customers on a timely basis. The Company’s business was negatively impacted and is expected to generate lower revenue and net income during the period from April 2020. Our supply chain is subject to the business interruptions arising from these measures. If the pandemic continues in the second half of 2020, our business and financial results in the future will likely be adversely affected. The extent to which COVID-19 negatively impacts our business results is highly uncertain and cannot be accurately predicted. We believe that COVID-19 outbreak and the measures taken to control it may have a large negative impact on economic activities in China. A majority of our business operations and our supply chain are conducted in China, which are expected to be negatively affected by COVID-19 outbreak. The magnitude of this negative effect on the continuity of our business operation and supply chains in China remains uncertain. These uncertainties impede our ability to conduct our daily operations and could materially and adversely affect our business, financial condition and results of operations. As of March 31, 2020, the Company’s manufacturing facilities resumed normal operations. The Company did not record any asset impairments, inventory charges or bad debt provision related to COVID-19 during the year ended March 31, 2020. However, if the customer demand is persistently weak in coming months or the operations of its plants in PRC are instructed to suspend again, the Company may require such charges. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of consolidation Goodwill Cash and cash equivalents Marketable securities- Inventories - Property, plant and equipment Leasehold land and buildings 30 - 50 years Plant and machinery 5 - 15 years Furniture, fixtures and equipment 4 - 5 years Motor vehicles 3 - 5 years Leasehold improvements 2 - 5years Leases When the Company is the lessor, minimum contractual rental from leases is recognized on a straight-line basis over the non-cancelable term of the lease. With respect to a particular lease, actual amounts billed in accordance with the lease during any given period may be higher or lower than the amount of rental revenue recognized for the period. Straight-line rental revenue commences when the customer assumes control of the leased premises. Accrued straight-line rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements. If later, the billing amount exceeds the straight-line rental revenue, the variance will be credited to accrued straight-line rents receivable. Contingent rental revenue is accrued when the contingency is removed. Impairment of long-lived assets Revenue recognition – Revenue from contracts with customers is recognized using the following five steps pursuant ASC Topic 606, Revenue from Contracts with Customers: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the Company satisfies a performance obligation. Products sales The Company recognizes revenue upon transfer of control of its products to the customer, which typically occurs upon delivery. The Company’s main performance obligation to its customers is the delivery of products in accordance with purchase orders. Each purchase order defines the transaction price for the products purchased under the arrangement. Acceptance of delivery of the products is evidenced by goods receipt notes signed by the customer. The Company has no remaining obligations after the customer’s acceptance of the products. Under the terms of the contracts or purchase orders between the Company and the customer, the control of the products is transferred to the customer upon the signing of the goods receipt notes and the customer has no rights to return the products (other than for defective products). Some customers examine and pick up the products at our plant while some local customers instruct us to deliver the products to their plants nearby. Some overseas customers instruct us to deliver the products to the named port of shipment. Delivery of the products occurs at that point of time when the control of the products is transferred to the customer. The selling price, which is specified in the purchase orders, is fixed. Under the terms of the purchase orders, upon the sale of the products to the customer and the signing of the good receipts notes, the Company has the legally enforceable right to receive full payment of the sales price. The customer’s obligation to pay the Company is not dependent on the customer selling the products or collecting cash from their customers (or end customers). The customer is required to pay under normal sales terms. The Company’s normal payment terms range from 30 days to 90 days and its sales arrangements do not have any material financing components. In addition, the Company’s customer arrangements do not produce contract assets or liabilities that are material to its consolidated financial statements. The Company permits the return of damaged or defective products and accounts for these actual returns as deduction from sales. Product returns to the Company were insignificant during past years. Incremental costs to fulfill the Company’s customer arrangements are expensed as incurred, as the amortization period is less than one year. The Company’s sales are net of value added tax (“VAT”) and business tax and surcharges collected on behalf of tax authorities in respect of product sales. VAT and business tax and surcharges collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until it is paid to the tax authorities. Outbound freight and Handling costs: The company accounts for product outbound freight and handling costs as fulfillment activities and present the associated costs in selling expenses in the period in which it sells the product. Disaggregation of Revenues: The following table disaggregates product sales by business segment and by geography, which provides information as to the major source of revenue. See Note 16 for additional description of our reportable business segments. Year ended March 31, 2019 Injection molded Electronic Total Net sales United States of America $1,504 $11,358 $12,862 PRC 25,637 5,135 30,772 United Kingdom 255 3,331 3,586 Hong Kong 1,195 3,531 4,726 Europe 188 7,998 8,186 Others - 6,449 6,449 Total net sales $28,779 $37,802 $66,581 Year ended March 31, 2020 Injection molded Electronic Total Net sales United States of America $1,265 $9,963 $11,228 PRC 22,567 4,530 27,097 United Kingdom 159 4,693 4,852 Hong Kong 1,202 4,986 6,188 Europe 153 9,674 9,827 Others 7 6,169 6,176 Total net sales $25,353 $40,015 $65,368 Allowance for doubtful account Year ended March 31, Allowance for doubtful account 2018 2019 2020 Balance at beginning of the year $1,252 $270 $658 Provision for the year 34 419 297 Bad debt recovery (708) (16) - Written off (308) (15) (1) $270 $658 $954 The provision and the bad debt recovery for the years were charged to other income (expenses), net in consolidated statements of comprehensive income (loss). Shipping and handling cost- Income taxes The Company adopted the provisions of ASC No. 740 “Income Taxes” (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides accounting guidance on de-recognition, classification, interest and penalties, disclosure and transition. Foreign currency translation All transactions in currencies other than functional currencies during the year are translated at the exchange rates prevailing on the transaction dates. Monetary items existing at the balance sheet date denominated in currencies other than the functional currencies are translated at period end rates. Gains and losses resulting from the translation of foreign currency transactions and balances are included in the consolidated statement of comprehensive income (loss). The exchange rates between the Hong Kong dollars and the U.S. dollar were approximately 7.7904, 7.7904 and 7.7904 as of March 31, 2018, 2019 and 2020, respectively. The exchange rates between the Chinese Renminbi and the U.S. dollar were approximately 6.3916, 6.7472 and 7.0246 as of March 31, 2018, 2019 and 2020, respectively. Aggregate net foreign currency transaction (loss) gain included in other income (expenses) were, $(56), $(82) and $505 for the years ended March 31, 2018, 2019 and 2020, respectively. Post-retirement and post-employment benefits Stock-based compensation There were no stock options granted during the year ended March 31, 2018, 2019 and 2020. Net income (loss) per share Basic net income (loss) per share and diluted net income (loss) per share calculated in accordance with ASC No. 260, “Earnings Per Share”, are reconciled as follows (shares in thousands): Year ended March 31, 2018 2019 2020 Net income (loss) attribute to Deswell Industries, Inc. $6,190 $4,273 $(1,320) Basic weighted average common shares outstanding 15,885 15,885 15,914 Basic net income (loss) per share $0.39 $0.27 $(0.08) Year ended March 31, 2018 2019 2020 Basic weighted average common shares outstanding 15,885 15,885 15,914 Effect of dilutive securities – Options 100 174 - Diluted weighted average common and potential common 15,985 16,059 15,914 Diluted net income (loss) per share $0.39 $0.27 $(0.08) During the year ended March 31, 2020, 107,000 outstanding stock options were not included in the computation of diluted net loss per share, because to do so would have had an antidilutive effect due to our net loss for the year ended March 31, 2020. Use of estimates - Fair value of financial instruments - Fair value measurements - It establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as certain securities that are highly liquid and are actively traded in over-the-counter markets. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques based on significant unobservable inputs, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. Non-recurring fair value measurements Fair value of long-lived assets, including real estate, are determined by estimating the amount and timing of net future cash flows (which are unobservable inputs) and discounting them using a risk-adjusted rate of interest. The Company estimates future cash flows based on its experience and knowledge of the market. Significant increases or decreases in actual cash flows may result in valuation changes. For real estate, fair values are based on discounted cash flow estimates which reflect current and projected lease profiles and available industry information about capitalization rates and expected trends in rents and occupancy and are corroborated by external appraisals. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The amendments in this update create Topic 842, Leases, and supersede the leases requirements in Topic 840, Leases. Topic 842 specifies the accounting for leases. The objective of Topic 842 is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The main difference between Topic 842 and Topic 840 is the recognition of lease assets and lease liabilities for those leases classified as operating leases under Topic 840. Topic 842 retains a distinction between finance leases and operating leases. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous leases guidance. The result of retaining a distinction between finance leases and operating leases is that under the lessee accounting model in Topic 842, the effect of leases in the statement of comprehensive income and the statement of cash flows is largely unchanged from previous GAAP. Effective April 1, 2019, the Company adopted the ASU 2016-02, Leases, which requires the recognition of lease assets and these liabilities by leases for those leases classified as an operating lease under previous guidance. The original guidance required application on a modified retrospective basis with the earliest period presented. In August, 2018, the FASB issues ASU 2018-11, Targeted Improvements to ASC 842, which included an option to not restate comparative periods in transition and elect to use the effective date of ASC 842, Leases, as the date of initial application of transition which we elected. The adoption of ASC 842 did not have a material impact on the Company’s consolidated financial statements, as the Company’s operating lease contracts mainly had a term of one year or less as of April 1, 2019. Refer to Note 9 — Leases for additional information regarding the adoption of ASC 842 from a lessor as well as from a lessee perspective. In June 2018, the FASB issued ASU 2018-07, Compensation — — — Recent Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), which eliminates, adds and modifies certain disclosure requirements for fair value measurements. The modified standard eliminates the requirement to disclose changes in unrealized gains and losses included in earnings for recurring Level 3 fair value measurements and requires changes in unrealized gains and losses be included in other comprehensive income for recurring Level 3 fair value measurements of instruments. The standard also requires the disclosure of the range and weighted average used to develop significant unobservable inputs and how weighted average is calculate for recurring and nonrecurring Level 3 fair value measurements. The amendment is effective for fiscal years beginning after December 15, 2019 and interim periods within that fiscal year, with early adoption permitted. The Company does not expect the adoption of ASU 2018-13 to have a material impact on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaced the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 requires use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. Adoption of the standard requires using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date to align existing credit loss methodology with the new standard. The Company will adopt ASU 2016-13 effective April 1, 2020. The Company does not expect the adoption of ASU 2016-13 to have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 will simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. The Company is evaluating the impact of the adoption of ASU 2019-12, but does not expect it to have a material impact on income taxes as reported in its consolidated financial statements. |
Marketable Securities
Marketable Securities | 12 Months Ended |
Mar. 31, 2020 | |
Marketable Securities [Abstract] | |
Marketable Securities | 3. Marketable Securities The Company acquired equity securities listed in Hong Kong and Australian Securities Exchange. March 31, 2019 2020 Cost $21,746 $21,920 Market value $24,446 $19,441 Included in Non-operating income (expenses), net were unrealized gain (loss) for the years ended March 31, 2018, 2019 and 2020 of $1,401, $891 and $(5,179), respectively. Net proceeds from sale of marketable securities for the years ended March 31, 2018, 2019 and 2020 were $6,580, $7,210 and $1,620 respectively and realized gain from sales of marketable securities for the years ended March 31, 2018, 2019 and 2020 were $609, $746 and $29, respectively. For the purposes of determining realized gains and losses, the cost of securities sold was determined based on the average cost method. The marketable securities were classified as Level 1 of the hierarchy established under ASC No. 820 because the valuations were based on quoted prices for identical securities in active markets. |
Inventories
Inventories | 12 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | 4. Inventories Inventories, net of allowances, by major categories are summarized as follows: March 31, 2019 2020 Raw materials $7,020 $4,668 Work-in-progress 3,884 2,386 Finished goods 2,126 1,524 $13,030 $8,578 Obsolescence allowance for inventory is as follows: Year ended March 31, 2018 2019 2020 Balance at beginning of the year $3,570 $3,634 $3,890 Additional charges, net 296 256 426 Written off (232) - - Balance at the end of the year $3,634 $3,890 $4,316 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | 5 . Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following: March 31, 2019 2020 Value added tax recoverable $322 $330 Rental and utility deposit 20 21 Advance to suppliers 220 107 Prepayment 526 427 Coupon and dividend receivable 109 114 Others 809 753 $2,006 $1,752 |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 12 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | 6. Property, Plant and Equipment, net Property, plant and equipment, net consist of the following: March 31, 2019 2020 At cost: Leasehold land and buildings $32,233 $32,233 Plant and machinery 38,839 37,559 Furniture, fixtures and equipment 11,642 11,292 Motor vehicles 1,513 1,512 Leasehold improvements 3,832 3,908 Impairment (3,093) (2,951) 84,966 83,553 Less: accumulated depreciation and amortization (54,755) (54,967) Net book value $30,211 $28,586 Included in furniture, fixtures and equipment is computer software with net values of $26 and $34 as of March 31, 2019 and 2020, respectively. Cost of leasehold land and buildings consist of the following: March 31, 2019 2020 Land use right of state-owned land and buildings erected thereon (a) $28,077 $28,077 Long term leased land and buildings erected thereon (b) 4,156 4,156 $32,233 $32,233 (a) The land use rights of state-owned land and buildings erected thereon represent land and buildings located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building with terms of 50 years expiring in 2050. (b) Long term leased land and buildings erected thereon represent land and buildings on collectively-owned land located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building for a term of 50 years to 2053. Dongguan Chang An Xiaobian District Co-operation, the lessor, is the entity to whom the collectively-owned land has been granted. According to existing PRC laws and regulations, collectively-owned land is not freely transferable unless certain application and approval procedures are fulfilled by the Dongguan Chang An Xiaobian District Co-operation to change the legal form of the land from collectively-owned to state-owned. As of March 31, 2020, the Company is not aware of any steps being taken by the Dongguan Chang An Xiaobian District Co-operation for such application. Included in leasehold land and buildings is property on lease with net values of $6,224 and $7,265 as of March 31, 2019 and 2020, respectively. Details of the property on lease are as follows: Included in leasehold land and buildings March 31, 2019 2020 Cost $8,831 $10,623 Less: accumulated depreciation and amortization (2,607) (3,358) Net book value $6,224 $7,265 During the years ended March 31, 2018, 2019 and 2020, the Company had no impairment on its property, plant and equipment. Depreciation of property, plant and equipment were $2,138, $2,114 and $1,973 during the years ended March 31, 2018, 2019 and 2020, respectively. |
Other Accrued Liabilities
Other Accrued Liabilities | 12 Months Ended |
Mar. 31, 2020 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Other Accrued Liabilities | 7. Other Accrued Liabilities Other accrued liabilities consist of the following: March 31, 2019 2020 Accrued expenses $541 $541 Others 1,121 1,177 $1,662 $1,718 |
Income Taxes
Income Taxes | 12 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes Net income (loss) before taxes of $6,197, $4,417 and $(947) were solely attributed by non-U.S. for the years ended March 31, 2018, 2019 and 2020, respectively. Under the current BVI law, the Companys income is not subject to taxation. Subsidiaries operating in Hong Kong and the PRC are subject to income taxes as described below, and the subsidiaries operating in Macao are exempted from income taxes. Under the current Samoa Law, subsidiary incorporated in Samoa is not subject to profit tax as it has no business operations in Samoa. The provision for current income taxes of the subsidiaries operating in Hong Kong has been calculated by applying the current rate of taxation of 16.5% (2018:16.5%, 2019:16.5%) to the estimated taxable income arising in or derived from Hong Kong, if applicable. In accordance with the PRC Income Tax Law, the standard income tax for all subsidiaries operating in the PRC is 25%. The provision for income taxes consists of the following: Year ended March 31, 2018 2019 2020 Current tax - PRC $173 $236 $265 Deferred tax (166) (92) 108 $7 $144 $373 Reconciliation between the provision for income taxes computed by applying the statutory tax rate in the PRC to income before income taxes and the actual provision for income taxes is as follows: Year ended March 31, 2018 2019 2020 Provision for income taxes at statutory tax rate in the PRC $1,549 $1,105 $(236) Tax rate differential on entities not subject to PRC income tax (797) (284) 1,281 Effect of income for which no income tax is chargeable (757) (791) (850) Effect of expense for which no income tax is deductible 207 142 139 Net change in valuation allowances (195) (22) 39 Over provision of income tax in previous years - (6) - Effective tax $7 $144 $373 The net deferred income tax consists of the following: March 31, 2019 2020 Deferred income tax assets $- $- Deferred income tax liabilities (659 ) (751 ) Net deferred income tax liabilities $(659 ) $(751 ) The components of net deferred income tax are as follows: March 31, 2019 2020 Deferred income tax assets (liabilities) : Net operating loss carry forwards $- $- Provision of employee benefits 582 803 Depreciation and amortization 85 (248 ) Revenue and cost of sales recognized for financial reporting purpose before being recognized for tax purpose (1,277 ) (1,016 ) Others 110 (93 ) Less: Valuation allowances (159 ) (197 ) Net deferred income tax liabilities $(659 ) $(751 ) The Company operates through the PRC entities and the valuation allowance is considered on each individual basis. The Companys assessment is that it is not more likely than not that these deferred tax assets will be realized. The net operating loss attributable to those PRC entities can only be carried forward for a maximum period of five years. Tax losses of non-PRC entities can be carried forward indefinitely. Under the PRC Income Tax Law and the implementation rules, profits of the PRC entities earned on or after January 1, 2008 and distributed by the PRC entities to the Company are subject to a withholding tax at a rate of 10%, unless the Company will be deemed as a resident enterprise for tax purposes. Since the Company intends to reinvest the earnings of the PRC entities in operations in the PRC, the PRC entities do not intend to declare dividends to their immediate non-PRC established holding companies in the foreseeable future. Accordingly, no deferred taxation on undistributed earnings of the PRC entities has been recognized as of March 31, 2020. The Company has adopted the provisions of ASC 740 on April 1, 2007. The evaluation of a tax position in accordance with ASC 740 begins with a determination as to whether it is more-likely-than-not that a tax position will be sustained upon examination based on the technical merits of the position. A tax position that meets the more-likely-than-not recognition threshold is then measured at the largest amount of benefit that if greater than 50 percent likely of being realized upon ultimate settlement for recognition in the financial statements. The Company classifies interest and/or penalties related to unrecognized tax benefits as a component of income tax provisions; however, as of March 31, 2019 and 2020, there is no interest and penalties related to uncertain tax positions. A reconciliation of the beginning and ending amount of total unrecognized tax benefits is as follows: Year ended March 31, 2018 2019 2020 Balance at the beginning of the year $316 $424 $482 Increase related to current year tax positions 108 58 253 Balance at end of the year $424 $482 $735 At March 31, 2019 and 2020, there are $482 and $735 of unrecognized tax benefits that if recognized, would affect the annual effective tax rate. For the year ended March 31, 2018, 2019 and 2020, the Company did not recognize any interest and penalties related to unrecognized tax benefits. The unrecognized tax benefits represent the estimated income tax expenses the Company would be required to pay, should the income tax rate used, taxable income and deductible expenses for tax purpose recognized in accordance with tax laws and regulations. The Company is currently unable to provide an estimate of a range of the total amount of unrecognized tax benefits that is reasonably possible to change significantly within the next twelve months. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by the taxpayer or its withholding agent. The statute of limitations extends to five years under special circumstances, which are not clearly defined. In the case of a related party transaction, the statute of limitations is ten years. There is no statute of limitations in the case of tax evasion. In accordance with Guo Shui Fa [2009] No.2, the PRC tax authorities have the right to deem the Company for a tax amount based on the transfer pricing contemporaneous documentations (the Contemporaneous Documentations) or a basis that they considered reasonable. The amount of income taxes payable at March 31, 2019 and 2020 includes the deemed profit tax estimated by the management based on the Contemporaneous Documentations. |
Lease
Lease | 12 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease | 9. Lease Operating leases as lessor We have non-cancellable agreements to lease our factory buildings to tenants under operating lease. The lease terms are between 1 month to 36 months. The leases do not contain contingent payments. At March 31, 2020, the minimum future rental income to be received is as follows: Year ending March 31, 2021 $420 Year ending March 31, 2022 6 Total minimum future rental income $426 The following table represents lease income recognized in the consolidated statements of comprehensive income (loss) for the year ended March 31, 2020. Operating lease income $1,564 Other information: Operating cash flows from operating leases as lessor $1,552 Operating leases as lessee The Company leases premises and warehouses under various operating leases, certain of which contain escalation clauses. As of April 1, 2019, the Company had lease contracts with a term of one year or less. During the year ended March 31, 2020, the Company has entered into a renewed lease that have not yet commenced with future total lease payments of $104. The lease for office space will commence in fiscal year 2021 with lease term of 2 years. As the total lease payments was insignificant, the Company did not recognize any ROU assets and operating lease liabilities in the consolidated balance sheets. Rental expenses under operating leases included in the consolidated statements of comprehensive income (loss) were $68, $72 and $74 for the years ended March 31, 2018, 2019 and 2020, respectively. The following table represents lease costs recognized in the Company’s consolidated statements of comprehensive income (loss) for the year ended March 31, 2020. Lease costs are included in selling, general and administrative expense on the Company’s consolidated statements of comprehensive income (loss). Lease costs Operating lease costs $74 Total lease costs $74 Supplemental cash flow information for our leases was as follows Cash Paid for amount included in the measurement of lease liabilities Operating cash flows from operating leases $60 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies The Company leases premises offices under non-cancelable operating lease agreements. See note 9 for future minimum lease payments under non-cancelable operating lease agreements with initial terms of one year or more. At March 31, 2020, the Company had capital commitments for purchase of plant and machinery, and leasehold improvement totaling $136, which are expected to be disbursed during the year ending March 31, 2021. |
Employee Benefits
Employee Benefits | 12 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Employee Benefits | 11. Employee Benefits The Company contributes to a state pension plan run by the Chinese government in respect of its employees in the PRC. The expense of $800, $751 and $640 included in the consolidated statements of comprehensive income (loss) related to this plan, which is calculated at the range of 8% to 14%of the average monthly salary, was provided for the years ended March 31, 2018, 2019 and 2020, respectively. |
Stock Option Plan
Stock Option Plan | 12 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Option Plan | 12. Stock Option Plan On March 15, 1995, the Company adopted the 1995 Stock Option Plan that permits the Company to grant options to officers, directors, employees and others to purchase up to 1,012,500 shares of Common Stock. On September 29, 1997, the Company approved an increase of 549,000 shares making a total of 1,561,500 shares of common stock available under the stock option plan. On January 7, 2002, the Company adopted the 2001 Stock Option Plan to purchase an additional 1,125,000 shares of Common Stock. On September 30, 2003, the Company adopted the 2003 Stock Option Plan to purchase an additional 900,000 shares of Common Stock. On September 19, 2005, the Company’s shareholders approved an increase of 500,000 shares making a total of 1,400,000 shares of common stock available under the 2003 Stock Option Plan. On August 17, 2007, the Company’s Board of Directors, subject to shareholders’ approval, approved an increase of 400,000 shares making a total of 1,800,000 shares of common stock available under the 2003 Stock Option Plan. The Company’s shareholders approved this amendment at the Company’s Annual Shareholders’ Meeting held on October 9, 2007. On August 13, 2010, the Company’s Board of Directors, subject to shareholders’ approval, approved an increase of 800,000 shares making a total of 2,600,000 shares of common stock available under the 2003 Stock Option Plan. The Company’s shareholders approved this amendment at the Company’s Annual Shareholders’ Meeting held on September 16, 2010. On August 7, 2013, the Company’s Board of Directors, subject to shareholder approval, approved amendments to the 2003 Stock Option Plan to increase by 900,000 shares the number of shares that can be optioned and sold under the 2003 Stock Option Plan, bringing to a total of 3,500,000 shares the number of common shares that can be optioned and sold under the 2003 Stock Option Plan. The Company’s shareholders approved this amendment at the Company’s Annual shareholders’ Meeting held on September 11, 2013. As of March 31, 2020, options to purchase an aggregate of 5,669,000 common shares had been granted under the stock option plans. Options granted under the stock option plans vest immediately and are exercisable for a period of up to 10 years commencing on the date of grant, at a price equal to at least the fair market value of the Common Stock at the date of grant, and may contain such other terms as the Board of Directors or a committee appointed to administer the plan may determine. A summary of the option activity (with weighted average prices per option) is as follows: Year ended March 31, 2018 2019 2020 Number Weighted Weighted Number Weighted Weighted Number Weighted Weighted Outstanding at beginning of the year 532,000 $2.1 $0.51 506,000 $2.1 $0.51 500,000 $2.1 $0.51 Exercised during the year - $- $- - $- $- (30,000) $2.14 $0.55 Cancelled during the year (26,000) $2.1 $0.55 (6,000) $2.09 $0.55 - $- $- Outstanding and exercisable at the end of the year 506,000 $2.1 $0.51 500,000 $2.1 $0.51 470,000 $2.1 $0.51 Range of exercise price per share $2.09 to $2.14 $2.09 to $2.14 $2.09 to $2.14 During the years ended March 31, 2018, 2019 and 2020, the Company recognized employee stock-based compensation expense of $nil, $nil and $nil, respectively. No options were granted for the years ended March 31, 2018, 2019 and 2020. The weighted average remaining contractual life of the share options outstanding at March 31, 2020 was 4.0 years. At March 31, 2019 and 2020, there were 1,268,000 and 1,268,000 options available for future grant under the plans, respectively. As of March 31, 2020, the Company had outstanding stock options to acquire an aggregate of 470,000 shares of common stock with an intrinsic value of $58. Of those outstanding options, 470,000 shares had vested as of March 31, 2020, representing an intrinsic value of $58. As of March 31, 2019, the Company had outstanding stock options to acquire an aggregate of 500,000 shares of common stock with an intrinsic value of $445. Of those outstanding options, 500,000 shares had vested as of March 31, 2019, representing an intrinsic value of $445. The total intrinsic value of options exercised amounted to $26 during the year ended March 31, 2020. |
Other income (expenses), net
Other income (expenses), net | 12 Months Ended |
Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other income (expenses), net | 13. Other income (expenses), net Other income (expenses), net consist of the following: Year ended March 31, 2018 2019 2020 (Loss) gain on disposal of property, plant and equipment, net $(61) $(22) $29 Exchange loss, net (56) (82) (505) Reversal of (provision for) doubtful accounts, net 674 (403) (297) Others 337 229 348 Other income (expenses), net $894 $(278) $(425) |
Non-operating income (expenses)
Non-operating income (expenses), net | 12 Months Ended |
Mar. 31, 2020 | |
Other Income, Nonoperating [Abstract] | |
Non-operating income (expenses), net | 14. Non-operating income (expenses), net Non-operating income (expenses), net consist of the following: Year ended March 31, 2018 2019 2020 Dividend income from marketable securities $859 $738 $1,049 Interest income from bank deposits 267 184 218 Unrealized gain (loss) from marketable securities 1,401 891 (5,179) Realized gain from sales of marketable securities 609 746 29 Rental income 1,111 1,455 1,564 Others 148 (130) (41) Non-operating income (expenses), net $4,395 $3,884 $(2,360) |
Operating Risk
Operating Risk | 12 Months Ended |
Mar. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Operating Risk | 15. Operating Risk Concentrations of Credit Risk and Major Customers Percentage of net sales Year ended March 31, 2018 2019 2020 Customer A 10.8% * * Customer B * 11.5% 12.0% Customer C 10.8% * * Customer D 12.8% 12.5% 11.6% Customer E 11.9% 11.1% 18.7% * Less than 10% Sales to the above customers relate to both injection-molded plastic parts and electronic products. Debtors accounting for 10% or more of total accounts receivable at March 31, 2019 and 2020, respectively, are as follows: Percentage of March 31, 2019 2020 Customer A 14.4% 10.2% Customer B 10.8% * Customer C 26.0% 14.6% Customer D * 10.0% * Less than 10% There were $308, $15 and $1 accounts receivable written off during the years ended March 31, 2018, 2019 and 2020, respectively. There were net reversal of (provision for) doubtful accounts of $(674), $403 and $297 during the years ended March 31, 2018, 2019 and 2020, respectively. At March 31, 2019 and 2020, allowances for doubtful accounts were $658 and $954, respectively. Concentrations of Suppliers Country risk Investment price risk |
Segment Information
Segment Information | 12 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | 16. Segment Information The Company has two reportable segments: plastic injection molding and electronic products assembling. The Companys reportable segments are strategic business units that offer different products and services. They are managed separately because each business requires different technology and marketing strategies. Most of the businesses were acquired as a unit, and the management at the time of the acquisition was retained. The Company used to include the corporate expenses, which mainly comprised of directors remuneration, legal and professional expenses and corporate insurance expenses, in the segment of plastic injection. Commencing from this year, the corporate expenses are separately disclosed in the segment information for a more precise presentation of the financial performance of each segment. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The Company accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices. Contributions of the major activities, profitability information and asset information of the Companys reportable segments for the years ended March 31, 2018, 2019 and 2020 are as follows: Year ended March 31, 2018 2019 2020 Net Intersegment Income Net Intersegment Income Net Intersegment Income Segment: Injection molded plastic parts $28,609 $(394) $5,405 $28,956 $(178) $3,686 $25,531 $(178) $(1,197) Electronic products 32,512 (60) 2,047 37,865 (62) 2,077 40,077 (62) 1,544 Segment total $61,121 $(454) $7,452 $66,821 $(240) $5,763 $65,608 $(240) $347 Reconciliation to consolidated totals: Sales eliminations (454) 454 - (240) 240 - (240) 240 - Corporate expenses $(1,255) $(1,346) $(1,294) Consolidated totals: Net sales $60,667 $- $66,581 $- $65,368 $- Income (loss) before income taxes $6,197 $4,417 $(947) Year ended March 31, 2018 2019 2020 Interest Interest Interest Interest Interest Interest Segment: Injection molded plastic parts $257 $- $173 $- $204 $- Electronic products 10 - 11 - 14 - Consolidated total $267 $- $184 $- $218 $- Year ended March 31, 2018 2019 2020 Depreciation Depreciation Depreciation Segment: Injection molded plastic parts $72,691 $1,644 $1,802 $71,615 $711 $1,849 $66,741 $251 $1,754 Electronic products 27,708 63 336 28,554 167 265 28,638 256 219 Consolidated Totals $100,399 $1,707 $2,138 $100,169 $878 $2,114 $95,379 $507 $1,973 The breakdown of sales by destination is analyzed as follows: Year ended March 31, 2018 2019 2020 Net sales United States of America $10,630 $12,862 $11,228 PRC 30,077 30,772 27,097 United Kingdom 2,878 3,586 4,852 Hong Kong 4,610 4,726 6,188 Europe 8,304 8,186 9,827 Others 4,168 6,449 6,176 Total net sales $60,667 $66,581 $65,368 The location of the Companys identifiable assets is as follows: March 31, 2019 2020 Hong Kong and Macao $46,077 $42,412 PRC 54,092 52,967 Total identifiable assets 100,169 95,379 Goodwill - - Total assets $100,169 $95,379 |
Condensed Financial Information
Condensed Financial Information of Deswell Industries, Inc. | 12 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Deswell Industries, Inc. | 17. Condensed Financial Information of Deswell Industries, Inc. The condensed financial statements of Deswell Industries, Inc. have been prepared in accordance with accounting principles generally accepted in the United States of America. Under the PRC laws and regulations, Deswell Industries, Inc.s PRC subsidiaries are restricted in their ability to transfer certain of their net assets to Deswell Industries, Inc. in the form of dividend payments, loans or advances. The amounts restricted include paid-in capital and statutory reserves, as determined pursuant to PRC generally accepted accounting principles, totaling $61,240 (equivalent to RMB 413 million) and $58,918 (equivalent to RMB 413 million) as of March 31, 2019 and 2020, respectively. Balance sheets March 31, 2019 2020 Assets Current assets: Cash and cash equivalents $566 $902 Prepaid expenses and other current assets 41 42 Amounts due from subsidiaries 23,641 19,525 Total current assets 24,248 20,469 Investments in subsidiaries 61,447 61,563 Total assets $85,695 $82,032 Liabilities and shareholders equity Current liabilities: Accrued payroll and employee benefits $1,588 $1,588 Other accrued liabilities 143 122 Total current liabilities 1,731 1,710 Total shareholders equity 83,964 80,322 Total liabilities and shareholders equity $85,695 $82,032 Statements of comprehensive income (loss) Year ended March 31, 2018 2019 2020 Equity in earnings of subsidiaries $7,586 $5,778 $115 Operating expenses 1,396 1,505 1,435 Income (loss) before income taxes 6,190 4,273 (1,320) Income taxes - - - Net income (loss) 6,190 4,273 (1,320) Share of other comprehensive income (loss) of subsidiaries - - - Total comprehensive income (loss) $6,190 $4,273 $(1,320) Statements of cash flows Year ended March 31, 2018 2019 2020 Cash flows from operating activities Net income (loss) $6,190 $4,273 $(1,320) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Equity in earnings of subsidiaries (7,586) (5,778) (115) Changes in operating assets and liabilities: Prepaid expenses and other current assets (28) 17 (1) Amounts due from subsidiaries 2,625 3,355 4,116 Accrued payroll and employee benefits 2 (2) - Other accrued liabilities (6) 30 (21) Net cash provided by operating activities 1,197 1,895 2,659 Cash flows from financing activities Dividends paid (1,112) (1,588) (2,387) Proceeds from exercise of stock options - - 64 Net cash used in financing activities (1,112) (1,588) (2,323) Net increase in cash and cash equivalents 85 307 336 Cash and cash equivalents, beginning of year 174 259 566 Cash and cash equivalents, end of year $259 $566 $902 a) Basis of presentation In Deswell Industries, Inc.-only financial statements, Deswell Industries, Inc.s investments in subsidiaries are stated at cost plus its equity interest in undistributed earnings of subsidiaries since inception. Accordingly, such financial statements should be read in conjunction with the Companys consolidated financial statements. Deswell Industries, Inc. records its investments in its subsidiaries under the equity method of accounting as prescribed in ASC 323 Investment-Equity Method and Joint Ventures. Such investment is presented on the balance sheets as Investments in subsidiaries and share of the subsidiaries profit or loss as Equity in earnings (loss) of subsidiaries, on the statements of comprehensive income (loss). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. b) Related party transactions For the years ended March 31, 2018, 2019 and 2020, related party transactions were mainly composed of $120 paid to Jetcrown Industrial (Macao Commercial Offshore) Limited as service fee for each of the years. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Principles of consolidation | Principles of consolidation |
Goodwill | Goodwill |
Cash and cash equivalents | Cash and cash equivalents |
Marketable securities | Marketable securities- |
Inventories | Inventories - |
Property, plant and equipment | Property, plant and equipment Leasehold land and buildings 30 - 50 years Plant and machinery 5 - 15 years Furniture, fixtures and equipment 4 - 5 years Motor vehicles 3 - 5 years Leasehold improvements 2 - 5years |
Leases | Leases When the Company is the lessor, minimum contractual rental from leases is recognized on a straight-line basis over the non-cancelable term of the lease. With respect to a particular lease, actual amounts billed in accordance with the lease during any given period may be higher or lower than the amount of rental revenue recognized for the period. Straight-line rental revenue commences when the customer assumes control of the leased premises. Accrued straight-line rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements. If later, the billing amount exceeds the straight-line rental revenue, the variance will be credited to accrued straight-line rents receivable. Contingent rental revenue is accrued when the contingency is removed. |
Impairment of long-lived assets | Impairment of long-lived assets |
Revenue recognition | Revenue recognition – Revenue from contracts with customers is recognized using the following five steps pursuant ASC Topic 606, Revenue from Contracts with Customers: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, the Company satisfies a performance obligation. Products sales The Company recognizes revenue upon transfer of control of its products to the customer, which typically occurs upon delivery. The Company’s main performance obligation to its customers is the delivery of products in accordance with purchase orders. Each purchase order defines the transaction price for the products purchased under the arrangement. Acceptance of delivery of the products is evidenced by goods receipt notes signed by the customer. The Company has no remaining obligations after the customer’s acceptance of the products. Under the terms of the contracts or purchase orders between the Company and the customer, the control of the products is transferred to the customer upon the signing of the goods receipt notes and the customer has no rights to return the products (other than for defective products). Some customers examine and pick up the products at our plant while some local customers instruct us to deliver the products to their plants nearby. Some overseas customers instruct us to deliver the products to the named port of shipment. Delivery of the products occurs at that point of time when the control of the products is transferred to the customer. The selling price, which is specified in the purchase orders, is fixed. Under the terms of the purchase orders, upon the sale of the products to the customer and the signing of the good receipts notes, the Company has the legally enforceable right to receive full payment of the sales price. The customer’s obligation to pay the Company is not dependent on the customer selling the products or collecting cash from their customers (or end customers). The customer is required to pay under normal sales terms. The Company’s normal payment terms range from 30 days to 90 days and its sales arrangements do not have any material financing components. In addition, the Company’s customer arrangements do not produce contract assets or liabilities that are material to its consolidated financial statements. The Company permits the return of damaged or defective products and accounts for these actual returns as deduction from sales. Product returns to the Company were insignificant during past years. Incremental costs to fulfill the Company’s customer arrangements are expensed as incurred, as the amortization period is less than one year. The Company’s sales are net of value added tax (“VAT”) and business tax and surcharges collected on behalf of tax authorities in respect of product sales. VAT and business tax and surcharges collected from customers, net of VAT paid for purchases, is recorded as a liability in the consolidated balance sheets until it is paid to the tax authorities. Outbound freight and Handling costs: The company accounts for product outbound freight and handling costs as fulfillment activities and present the associated costs in selling expenses in the period in which it sells the product. Disaggregation of Revenues: The following table disaggregates product sales by business segment and by geography, which provides information as to the major source of revenue. See Note 16 for additional description of our reportable business segments. Year ended March 31, 2019 Injection molded Electronic Total Net sales United States of America $1,504 $11,358 $12,862 PRC 25,637 5,135 30,772 United Kingdom 255 3,331 3,586 Hong Kong 1,195 3,531 4,726 Europe 188 7,998 8,186 Others - 6,449 6,449 Total net sales $28,779 $37,802 $66,581 Year ended March 31, 2020 Injection molded Electronic Total Net sales United States of America $1,265 $9,963 $11,228 PRC 22,567 4,530 27,097 United Kingdom 159 4,693 4,852 Hong Kong 1,202 4,986 6,188 Europe 153 9,674 9,827 Others 7 6,169 6,176 Total net sales $25,353 $40,015 $65,368 |
Allowance for doubtful account | Allowance for doubtful account Year ended March 31, Allowance for doubtful account 2018 2019 2020 Balance at beginning of the year $1,252 $270 $658 Provision for the year 34 419 297 Bad debt recovery (708) (16) - Written off (308) (15) (1) $270 $658 $954 The provision and the bad debt recovery for the years were charged to other income (expenses), net in consolidated statements of comprehensive income (loss). |
Shipping and handling cost | Shipping and handling cost- |
Income taxes | Income taxes The Company adopted the provisions of ASC No. 740 “Income Taxes” (“ASC 740”), which clarifies the accounting for uncertainty in income taxes recognized by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides accounting guidance on de-recognition, classification, interest and penalties, disclosure and transition. |
Foreign currency translation | Foreign currency translation All transactions in currencies other than functional currencies during the year are translated at the exchange rates prevailing on the transaction dates. Monetary items existing at the balance sheet date denominated in currencies other than the functional currencies are translated at period end rates. Gains and losses resulting from the translation of foreign currency transactions and balances are included in the consolidated statement of comprehensive income (loss). The exchange rates between the Hong Kong dollars and the U.S. dollar were approximately 7.7904, 7.7904 and 7.7904 as of March 31, 2018, 2019 and 2020, respectively. The exchange rates between the Chinese Renminbi and the U.S. dollar were approximately 6.3916, 6.7472 and 7.0246 as of March 31, 2018, 2019 and 2020, respectively. Aggregate net foreign currency transaction (loss) gain included in other income (expenses) were, $(56), $(82) and $505 for the years ended March 31, 2018, 2019 and 2020, respectively. |
Post-retirement and post-employment benefits | Post-retirement and post-employment benefits |
Stock-based compensation | Stock-based compensation There were no stock options granted during the year ended March 31, 2018, 2019 and 2020. |
Net income (loss) per share | Net income (loss) per share Basic net income (loss) per share and diluted net income (loss) per share calculated in accordance with ASC No. 260, “Earnings Per Share”, are reconciled as follows (shares in thousands): Year ended March 31, 2018 2019 2020 Net income (loss) attribute to Deswell Industries, Inc. $6,190 $4,273 $(1,320) Basic weighted average common shares outstanding 15,885 15,885 15,914 Basic net income (loss) per share $0.39 $0.27 $(0.08) Year ended March 31, 2018 2019 2020 Basic weighted average common shares outstanding 15,885 15,885 15,914 Effect of dilutive securities – Options 100 174 - Diluted weighted average common and potential common 15,985 16,059 15,914 Diluted net income (loss) per share $0.39 $0.27 $(0.08) During the year ended March 31, 2020, 107,000 outstanding stock options were not included in the computation of diluted net loss per share, because to do so would have had an antidilutive effect due to our net loss for the year ended March 31, 2020. |
Use of estimates | Use of estimates - |
Fair value of financial instruments | Fair value of financial instruments - |
Fair value measurements | Fair value measurements - It establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable inputs, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market, as well as certain securities that are highly liquid and are actively traded in over-the-counter markets. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques based on significant unobservable inputs, as well as instruments for which the determination of fair value requires significant management judgment or estimation. Classification within the hierarchy is determined based on the lowest level of input that is significant to the fair value measurement. |
Non-recurring fair value measurements | Non-recurring fair value measurements Fair value of long-lived assets, including real estate, are determined by estimating the amount and timing of net future cash flows (which are unobservable inputs) and discounting them using a risk-adjusted rate of interest. The Company estimates future cash flows based on its experience and knowledge of the market. Significant increases or decreases in actual cash flows may result in valuation changes. For real estate, fair values are based on discounted cash flow estimates which reflect current and projected lease profiles and available industry information about capitalization rates and expected trends in rents and occupancy and are corroborated by external appraisals. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). The amendments in this update create Topic 842, Leases, and supersede the leases requirements in Topic 840, Leases. Topic 842 specifies the accounting for leases. The objective of Topic 842 is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. The main difference between Topic 842 and Topic 840 is the recognition of lease assets and lease liabilities for those leases classified as operating leases under Topic 840. Topic 842 retains a distinction between finance leases and operating leases. The classification criteria for distinguishing between finance leases and operating leases are substantially similar to the classification criteria for distinguishing between capital leases and operating leases in the previous leases guidance. The result of retaining a distinction between finance leases and operating leases is that under the lessee accounting model in Topic 842, the effect of leases in the statement of comprehensive income and the statement of cash flows is largely unchanged from previous GAAP. Effective April 1, 2019, the Company adopted the ASU 2016-02, Leases, which requires the recognition of lease assets and these liabilities by leases for those leases classified as an operating lease under previous guidance. The original guidance required application on a modified retrospective basis with the earliest period presented. In August, 2018, the FASB issues ASU 2018-11, Targeted Improvements to ASC 842, which included an option to not restate comparative periods in transition and elect to use the effective date of ASC 842, Leases, as the date of initial application of transition which we elected. The adoption of ASC 842 did not have a material impact on the Company’s consolidated financial statements, as the Company’s operating lease contracts mainly had a term of one year or less as of April 1, 2019. Refer to Note 9 — Leases for additional information regarding the adoption of ASC 842 from a lessor as well as from a lessee perspective. In June 2018, the FASB issued ASU 2018-07, Compensation — — — |
Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820), which eliminates, adds and modifies certain disclosure requirements for fair value measurements. The modified standard eliminates the requirement to disclose changes in unrealized gains and losses included in earnings for recurring Level 3 fair value measurements and requires changes in unrealized gains and losses be included in other comprehensive income for recurring Level 3 fair value measurements of instruments. The standard also requires the disclosure of the range and weighted average used to develop significant unobservable inputs and how weighted average is calculate for recurring and nonrecurring Level 3 fair value measurements. The amendment is effective for fiscal years beginning after December 15, 2019 and interim periods within that fiscal year, with early adoption permitted. The Company does not expect the adoption of ASU 2018-13 to have a material impact on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 replaced the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 requires use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted. Adoption of the standard requires using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date to align existing credit loss methodology with the new standard. The Company will adopt ASU 2016-13 effective April 1, 2020. The Company does not expect the adoption of ASU 2016-13 to have a material impact on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 will simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. The Company is evaluating the impact of the adoption of ASU 2019-12, but does not expect it to have a material impact on income taxes as reported in its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Property, Plant and Equipment | Depreciation and amortization are provided on the straight line method based on the estimated useful lives of the assets as follows: Leasehold land and buildings 30 - 50 years Plant and machinery 5 - 15 years Furniture, fixtures and equipment 4 - 5 years Motor vehicles 3 - 5 years Leasehold improvements 2 - 5years |
Schedule of Disaggregates Product Sales by Business Segment by Geography | The following table disaggregates product sales by business segment and by geography, which provides information as to the major source of revenue. See Note 16 for additional description of our reportable business segments. Year ended March 31, 2019 Injection molded Electronic Total Net sales United States of America $1,504 $11,358 $12,862 PRC 25,637 5,135 30,772 United Kingdom 255 3,331 3,586 Hong Kong 1,195 3,531 4,726 Europe 188 7,998 8,186 Others - 6,449 6,449 Total net sales $28,779 $37,802 $66,581 Year ended March 31, 2020 Injection molded Electronic Total Net sales United States of America $1,265 $9,963 $11,228 PRC 22,567 4,530 27,097 United Kingdom 159 4,693 4,852 Hong Kong 1,202 4,986 6,188 Europe 153 9,674 9,827 Others 7 6,169 6,176 Total net sales $25,353 $40,015 $65,368 |
Schedule of Allowance for Doubtful Account | Unanticipated changes in the liquidity or financial position of the Company’s customers may require additional provisions for doubtful accounts. Year ended March 31, Allowance for doubtful account 2018 2019 2020 Balance at beginning of the year $1,252 $270 $658 Provision for the year 34 419 297 Bad debt recovery (708) (16) - Written off (308) (15) (1) $270 $658 $954 |
Schedule of Net Income (Loss) Per Share | Basic net income (loss) per share and diluted net income (loss) per share calculated in accordance with ASC No. 260, “Earnings Per Share”, are reconciled as follows (shares in thousands): Year ended March 31, 2018 2019 2020 Net income (loss) attribute to Deswell Industries, Inc. $6,190 $4,273 $(1,320) Basic weighted average common shares outstanding 15,885 15,885 15,914 Basic net income (loss) per share $0.39 $0.27 $(0.08) Year ended March 31, 2018 2019 2020 Basic weighted average common shares outstanding 15,885 15,885 15,914 Effect of dilutive securities – Options 100 174 - Diluted weighted average common and potential common 15,985 16,059 15,914 Diluted net income (loss) per share $0.39 $0.27 $(0.08) |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Marketable Securities [Abstract] | |
Schedule of Marketable Securities | The Company acquired equity securities listed in Hong Kong and Australian Securities Exchange. March 31, 2019 2020 Cost $21,746 $21,920 Market value $24,446 $19,441 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories, Net of Allowances | Inventories, net of allowances, by major categories are summarized as follows: March 31, 2019 2020 Raw materials $7,020 $4,668 Work-in-progress 3,884 2,386 Finished goods 2,126 1,524 $13,030 $8,578 |
Schedule of Obsolescence Allowance for Inventory | Obsolescence allowance for inventory is as follows: Year ended March 31, 2018 2019 2020 Balance at beginning of the year $3,570 $3,634 $3,890 Additional charges, net 296 256 426 Written off (232) - - Balance at the end of the year $3,634 $3,890 $4,316 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following: March 31, 2019 2020 Value added tax recoverable $322 $330 Rental and utility deposit 20 21 Advance to suppliers 220 107 Prepayment 526 427 Coupon and dividend receivable 109 114 Others 809 753 $2,006 $1,752 |
Property, Plant and Equipment_2
Property, Plant and Equipment, net (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment, net | Property, plant and equipment, net consist of the following: March 31, 2019 2020 At cost: Leasehold land and buildings $32,233 $32,233 Plant and machinery 38,839 37,559 Furniture, fixtures and equipment 11,642 11,292 Motor vehicles 1,513 1,512 Leasehold improvements 3,832 3,908 Impairment (3,093) (2,951) 84,966 83,553 Less: accumulated depreciation and amortization (54,755) (54,967) Net book value $30,211 $28,586 |
Schedule of Leasehold Land and Buildings | Cost of leasehold land and buildings consist of the following: March 31, 2019 2020 Land use right of state-owned land and buildings erected thereon (a) $28,077 $28,077 Long term leased land and buildings erected thereon (b) 4,156 4,156 $32,233 $32,233 (a) The land use rights of state-owned land and buildings erected thereon represent land and buildings located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building with terms of 50 years expiring in 2050. (b) Long term leased land and buildings erected thereon represent land and buildings on collectively-owned land located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building for a term of 50 years to 2053. Dongguan Chang An Xiaobian District Co-operation, the lessor, is the entity to whom the collectively-owned land has been granted. According to existing PRC laws and regulations, collectively-owned land is not freely transferable unless certain application and approval procedures are fulfilled by the Dongguan Chang An Xiaobian District Co-operation to change the legal form of the land from collectively-owned to state-owned. As of March 31, 2020, the Company is not aware of any steps being taken by the Dongguan Chang An Xiaobian District Co-operation for such application. Included in leasehold land and buildings is property on lease with net values of $6,224 and $7,265 as of March 31, 2019 and 2020, respectively. Details of the property on lease are as follows: Included in leasehold land and buildings March 31, 2019 2020 Cost $8,831 $10,623 Less: accumulated depreciation and amortization (2,607) (3,358) Net book value $6,224 $7,265 |
Other Accrued Liabilities (Tabl
Other Accrued Liabilities (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Schedule of Other Accrued Liabilities | Other accrued liabilities consist of the following: March 31, 2019 2020 Accrued expenses $541 $541 Others 1,121 1,177 $1,662 $1,718 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Taxes | The provision for income taxes consists of the following: Year ended March 31, 2018 2019 2020 Current tax - PRC $173 $236 $265 Deferred tax (166) (92) 108 $7 $144 $373 |
Schedule of Income Tax Rate Reconciliation | Reconciliation between the provision for income taxes computed by applying the statutory tax rate in the PRC to income before income taxes and the actual provision for income taxes is as follows: Year ended March 31, 2018 2019 2020 Provision for income taxes at statutory tax rate in the PRC $1,549 $1,105 $(236) Tax rate differential on entities not subject to PRC income tax (797) (284) 1,281 Effect of income for which no income tax is chargeable (757) (791) (850) Effect of expense for which no income tax is deductible 207 142 139 Net change in valuation allowances (195) (22) 39 Over provision of income tax in previous years - (6) - Effective tax $7 $144 $373 |
Schedule of Deferred Income Tax Assets and Liabilties | The net deferred income tax consists of the following: March 31, 2019 2020 Deferred income tax assets $- $- Deferred income tax liabilities (659 ) (751 ) Net deferred income tax liabilities $(659 ) $(751 ) |
Components of Deferred Income Tax | The components of net deferred income tax are as follows: March 31, 2019 2020 Deferred income tax assets (liabilities) : Net operating loss carry forwards $- $- Provision of employee benefits 582 803 Depreciation and amortization 85 (248 ) Revenue and cost of sales recognized for financial reporting purpose before being recognized for tax purpose (1,277 ) (1,016 ) Others 110 (93 ) Less: Valuation allowances (159 ) (197 ) Net deferred income tax liabilities $(659 ) $(751 ) |
Schedule of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of total unrecognized tax benefits is as follows: Year ended March 31, 2018 2019 2020 Balance at the beginning of the year $316 $424 $482 Increase related to current year tax positions 108 58 253 Balance at end of the year $424 $482 $735 |
Lease (Tables)
Lease (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Future Rental Income | We have non-cancellable agreements to lease our factory buildings to tenants under operating lease. The lease terms are between 1 month to 36 months. The leases do not contain contingent payments. At March 31, 2020, the minimum future rental income to be received is as follows: Year ending March 31, 2021 $420 Year ending March 31, 2022 6 Total minimum future rental income $426 |
Schedule of Operating Lease Income | The following table represents lease income recognized in the consolidated statements of comprehensive income (loss) for the year ended March 31, 2020. Operating lease income $1,564 Other information: Operating cash flows from operating leases as lessor $1,552 |
Schedule of Operating Lease Cost | The following table represents lease costs recognized in the Company’s consolidated statements of comprehensive income (loss) for the year ended March 31, 2020. Lease costs are included in selling, general and administrative expense on the Company’s consolidated statements of comprehensive income (loss). Lease costs Operating lease costs $74 Total lease costs $74 |
Schedule of Supplemental Cash Flow Information Lease | Supplemental cash flow information for our leases was as follows Cash Paid for amount included in the measurement of lease liabilities Operating cash flows from operating leases $60 |
Stock Option Plan (Tables)
Stock Option Plan (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Payment Activity | A summary of the option activity (with weighted average prices per option) is as follows: Year ended March 31, 2018 2019 2020 Number Weighted Weighted Number Weighted Weighted Number Weighted Weighted Outstanding at beginning of the year 532,000 $2.1 $0.51 506,000 $2.1 $0.51 500,000 $2.1 $0.51 Exercised during the year - $- $- - $- $- (30,000) $2.14 $0.55 Cancelled during the year (26,000) $2.1 $0.55 (6,000) $2.09 $0.55 - $- $- Outstanding and exercisable at the end of the year 506,000 $2.1 $0.51 500,000 $2.1 $0.51 470,000 $2.1 $0.51 Range of exercise price per share $2.09 to $2.14 $2.09 to $2.14 $2.09 to $2.14 |
Other income (expenses), net (T
Other income (expenses), net (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of Other income (expenses), net | Other income (expenses), net consist of the following: Year ended March 31, 2018 2019 2020 (Loss) gain on disposal of property, plant and equipment, net $(61) $(22) $29 Exchange loss, net (56) (82) (505) Reversal of (provision for) doubtful accounts, net 674 (403) (297) Others 337 229 348 Other income (expenses), net $894 $(278) $(425) |
Non-operating income (expense_2
Non-operating income (expenses), net (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Other Income, Nonoperating [Abstract] | |
Schedule of Non-operating income (expenses), net | Non-operating income (expenses), net consist of the following: Year ended March 31, 2018 2019 2020 Dividend income from marketable securities $859 $738 $1,049 Interest income from bank deposits 267 184 218 Unrealized gain (loss) from marketable securities 1,401 891 (5,179) Realized gain from sales of marketable securities 609 746 29 Rental income 1,111 1,455 1,564 Others 148 (130) (41) Non-operating income (expenses), net $4,395 $3,884 $(2,360) |
Operating Risk (Tables)
Operating Risk (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Sales Revenue, Net [Member] | |
Concentration Risk [Line Items] | |
Schedule of Operating Risks | Percentage of net sales Year ended March 31, 2018 2019 2020 Customer A 10.8% * * Customer B * 11.5% 12.0% Customer C 10.8% * * Customer D 12.8% 12.5% 11.6% Customer E 11.9% 11.1% 18.7% * Less than 10% |
Accounts Receivable [Member] | |
Concentration Risk [Line Items] | |
Schedule of Operating Risks | Debtors accounting for 10% or more of total accounts receivable at March 31, 2019 and 2020, respectively, are as follows: Percentage of March 31, 2019 2020 Customer A 14.4% 10.2% Customer B 10.8% * Customer C 26.0% 14.6% Customer D * 10.0% * Less than 10% |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Contributions of Profitability Information For Reportable Segments | Contributions of the major activities, profitability information and asset information of the Company’s reportable segments for the years ended March 31, 2018, 2019 and 2020 are as follows: Year ended March 31, 2018 2019 2020 Net Intersegment Income Net Intersegment Income Net Intersegment Income Segment: Injection molded plastic parts $28,609 $(394) $5,405 $28,956 $(178) $3,686 $25,531 $(178) $(1,197) Electronic products 32,512 (60) 2,047 37,865 (62) 2,077 40,077 (62) 1,544 Segment total $61,121 $(454) $7,452 $66,821 $(240) $5,763 $65,608 $(240) $347 Reconciliation to consolidated totals: Sales eliminations (454) 454 - (240) 240 - (240) 240 - Corporate expenses $(1,255) $(1,346) $(1,294) Consolidated totals: Net sales $60,667 $- $66,581 $- $65,368 $- Income (loss) before income taxes $6,197 $4,417 $(947) Year ended March 31, 2018 2019 2020 Interest Interest Interest Interest Interest Interest Segment: Injection molded plastic parts $257 $- $173 $- $204 $- Electronic products 10 - 11 - 14 - Consolidated total $267 $- $184 $- $218 $- Year ended March 31, 2018 2019 2020 Depreciation Depreciation Depreciation Segment: Injection molded plastic parts $72,691 $1,644 $1,802 $71,615 $711 $1,849 $66,741 $251 $1,754 Electronic products 27,708 63 336 28,554 167 265 28,638 256 219 Consolidated Totals $100,399 $1,707 $2,138 $100,169 $878 $2,114 $95,379 $507 $1,973 |
Schedule of Net Sales by Geographical Area | The breakdown of sales by destination is analyzed as follows: Year ended March 31, 2018 2019 2020 Net sales United States of America $10,630 $12,862 $11,228 PRC 30,077 30,772 27,097 United Kingdom 2,878 3,586 4,852 Hong Kong 4,610 4,726 6,188 Europe 8,304 8,186 9,827 Others 4,168 6,449 6,176 Total net sales $60,667 $66,581 $65,368 |
Schedule of Segment Indentifiable Assets by Geographical Area | The location of the Companys identifiable assets is as follows: March 31, 2019 2020 Hong Kong and Macao $46,077 $42,412 PRC 54,092 52,967 Total identifiable assets 100,169 95,379 Goodwill - - Total assets $100,169 $95,379 |
Condensed Financial Informati_2
Condensed Financial Information of Deswell Industries, Inc. (Tables) | 12 Months Ended |
Mar. 31, 2020 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Balance Sheet | Balance sheets March 31, 2019 2020 Assets Current assets: Cash and cash equivalents $566 $902 Prepaid expenses and other current assets 41 42 Amounts due from subsidiaries 23,641 19,525 Total current assets 24,248 20,469 Investments in subsidiaries 61,447 61,563 Total assets $85,695 $82,032 Liabilities and shareholders’ equity Current liabilities: Accrued payroll and employee benefits $1,588 $1,588 Other accrued liabilities 143 122 Total current liabilities 1,731 1,710 Total shareholders’ equity 83,964 80,322 Total liabilities and shareholders’ equity $85,695 $82,032 |
Condensed Income Statement | Statements of comprehensive income (loss) Year ended March 31, 2018 2019 2020 Equity in earnings of subsidiaries $7,586 $5,778 $115 Operating expenses 1,396 1,505 1,435 Income (loss) before income taxes 6,190 4,273 (1,320) Income taxes - - - Net income (loss) 6,190 4,273 (1,320) Share of other comprehensive income (loss) of subsidiaries - - - Total comprehensive income (loss) $6,190 $4,273 $(1,320) |
Condensed Cash Flow Statement | Statements of cash flows Year ended March 31, 2018 2019 2020 Cash flows from operating activities Net income (loss) $6,190 $4,273 $(1,320) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Equity in earnings of subsidiaries (7,586) (5,778) (115) Changes in operating assets and liabilities: Prepaid expenses and other current assets (28) 17 (1) Amounts due from subsidiaries 2,625 3,355 4,116 Accrued payroll and employee benefits 2 (2) - Other accrued liabilities (6) 30 (21) Net cash provided by operating activities 1,197 1,895 2,659 Cash flows from financing activities Dividends paid (1,112) (1,588) (2,387) Proceeds from exercise of stock options - - 64 Net cash used in financing activities (1,112) (1,588) (2,323) Net increase in cash and cash equivalents 85 307 336 Cash and cash equivalents, beginning of year 174 259 566 Cash and cash equivalents, end of year $259 $566 $902 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narrative) (Details) $ in Thousands | 12 Months Ended | |||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2014USD ($) | |
Impairment of long-lived assets | ||||
Shipping and handling cost | 481 | 529 | 557 | |
Aggregate net foreign currency transaction gain | 505 | (82) | $ (56) | |
Goodwill | $ 393 | |||
Hong Kong, Dollars | ||||
Exchange rate per dollar | 7.7904 | 7.7904 | 7.7904 | |
China, Yuan Renminbi | ||||
Exchange rate per dollar | 7.0246 | 6.7472 | 6.3916 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Property, Plant and Equipment) (Details) | 12 Months Ended |
Mar. 31, 2020 | |
Leasehold land and buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 30 years |
Leasehold land and buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 50 years |
Plant and machinery [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Plant and machinery [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 15 years |
Furniture, fixtures and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 4 years |
Furniture, fixtures and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Motor vehicles [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Motor vehicles [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Leasehold Improvements [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 2 years |
Leasehold Improvements [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Schedule of Disaggregates Product Sales by Business Segment by Geography) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | $ 65,368 | $ 66,581 | $ 60,667 |
Injection Molded Plastic Parts [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 25,353 | 28,779 | |
Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 40,015 | 37,802 | |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 11,228 | 12,862 | 10,630 |
United States [Member] | Injection Molded Plastic Parts [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 1,265 | 1,504 | |
United States [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 9,963 | 11,358 | |
CHINA [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 27,097 | 30,772 | 30,077 |
CHINA [Member] | Injection Molded Plastic Parts [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 22,567 | 25,637 | |
CHINA [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 4,530 | 5,135 | |
UNITED KINGDOM [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 4,852 | 3,586 | 2,878 |
UNITED KINGDOM [Member] | Injection Molded Plastic Parts [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 159 | 255 | |
UNITED KINGDOM [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 4,693 | 3,331 | |
HONG KONG [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 6,188 | 4,726 | 4,610 |
HONG KONG [Member] | Intersegment Eliminations [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 1,202 | 1,195 | |
HONG KONG [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 4,986 | 3,531 | |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 9,827 | 8,186 | 8,304 |
Europe [Member] | Injection Molded Plastic Parts [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 153 | 188 | |
Europe [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 9,674 | 7,998 | |
Segments Geographical Location Other [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 6,176 | 6,449 | $ 4,168 |
Segments Geographical Location Other [Member] | Intersegment Eliminations [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | 7 | ||
Segments Geographical Location Other [Member] | Electronic Products [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total net sales | $ 6,169 | $ 6,449 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Allowance for Doubtful Account) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Allowance for doubtful accounts | |||
Balance at beginning of the year | $ 658 | $ 270 | $ 1,252 |
Provision for the year | 297 | 419 | 34 |
Bad debt recovery | (16) | (708) | |
Written off | (1) | (15) | (308) |
Balance at end of the year | $ 954 | $ 658 | $ 270 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Net Income (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Net (loss) income attributable to Deswell Industries, Inc.: | |||
Net income (loss) attribute to Deswell Industries, Inc. | $ (1,320) | $ 4,273 | $ 6,190 |
Basic weighted average common shares outstanding | 15,914 | 15,885 | 15,885 |
Basic net income (loss) per share | $ (0.08) | $ 0.27 | $ 0.39 |
Effect of dilutive securities - Options | 174 | 100 | |
Diluted weighted average common and potential common shares outstanding | 15,914 | 16,059 | 15,985 |
Diluted net income (loss) per share | $ (0.08) | $ 0.27 | $ 0.39 |
Shares related to stock options excluded from diluted net loss per share because their inclusion would have been anti-dilutive | 107,000 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Marketable Securities [Abstract] | |||
Marketable securities, cost | $ 21,920 | $ 21,746 | |
Marketable securities, market value | 19,441 | 24,446 | |
Unrealized gain (loss) on marketable securities | (5,179) | 891 | $ 1,401 |
Proceeds from sale of marketable securities | 1,620 | 7,210 | 6,580 |
Realized gain from sale of marketable securities | $ 29 | $ 746 | $ 609 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 4,668 | $ 7,020 | |
Work-in-progress | 2,386 | 3,884 | |
Finished goods | 1,524 | 2,126 | |
Total inventories | 8,578 | 13,030 | |
Balance at beginning of the year | 3,890 | 3,634 | $ 3,570 |
Additional charges, net | 426 | 256 | 296 |
Written off | (232) | ||
Balance at the end of the year | $ 4,316 | $ 3,890 | $ 3,634 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Value added tax recoverable | $ 330 | $ 322 |
Rental and utility deposit | 21 | 20 |
Advance to suppliers | 107 | 220 |
Prepayment | 427 | 526 |
Coupon and dividend receivable | 114 | 109 |
Others | 753 | 809 |
Total prepaid expenses and other current assets | $ 1,752 | $ 2,006 |
Property, Plant and Equipment_3
Property, Plant and Equipment, net (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | ||
Property, Plant and Equipment [Line Items] | ||||
Cost | $ 83,553 | $ 84,966 | ||
Impairment | (2,951) | (3,093) | ||
Less: accumulated depreciation and amortization | (54,967) | (54,755) | ||
Net book value | 28,586 | 30,211 | ||
Net value of computer software included in furniture, fixture and equipment | 34 | 26 | ||
Impairment of property, plant and equipment | ||||
Depreciation of property, plant and equipment | 1,973 | 2,114 | $ 2,138 | |
Long Term Leased Land And Buildings [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | [1] | $ 4,156 | $ 4,156 | |
Lease terms | 50 years | 50 years | ||
Lease expiration period | Dec. 31, 2053 | Dec. 31, 2053 | ||
Use Rights [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | [2] | $ 28,077 | $ 28,077 | |
Lease terms | 50 years | 50 years | ||
Lease expiration period | Dec. 31, 2050 | Dec. 31, 2050 | ||
Leasehold land and buildings [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | $ 32,233 | $ 32,233 | ||
Plant and machinery [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | 37,559 | 38,839 | ||
Furniture, fixtures and equipment [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | 11,292 | 11,642 | ||
Motor vehicles [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | 1,512 | 1,513 | ||
Leasehold Improvements [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | 3,908 | 3,832 | ||
Property Subject to Operating Lease [Member] | Leasehold land and buildings [Member] | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost | 10,623 | 8,831 | ||
Less: accumulated depreciation and amortization | (3,358) | (2,607) | ||
Net book value | $ 7,265 | $ 6,224 | ||
[1] | Long term leased land and buildings erected thereon represent land and buildings on collectively-owned land located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building for a term of 50 years to 2053. Dongguan Chang An Xiaobian District Co-operation, the lessor, is the entity to whom the collectively-owned land has been granted. According to existing PRC laws and regulations, collectively-owned land is not freely transferable unless certain application and approval procedures are fulfilled by the Dongguan Chang An Xiaobian District Co-operation to change the legal form of the land from collectively-owned to state-owned. As of March 31, 2020, the Company is not aware of any steps being taken by the Dongguan Chang An Xiaobian District Co-operation for such application. | |||
[2] | The land use rights of state-owned land and buildings erected thereon represent land and buildings located in the PRC on which an upfront lump-sum payment has been made for the right to use the land and building with terms of 50 years expiring in 2050. |
Other Accrued Liabilities (Deta
Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Accounts Payable and Accrued Liabilities, Current [Abstract] | ||
Accrued expenses | $ 541 | $ 541 |
Others | 1,177 | 1,121 |
Total other accrued liabilities | $ 1,718 | $ 1,662 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Components Of Income Loss Before Income Taxes [Line Items] | |||
Net income (loss) before taxes | $ (947) | $ 4,417 | $ 6,197 |
Current rate of taxation | 16.50% | 16.50% | 16.50% |
CHINA [Member] | |||
Components Of Income Loss Before Income Taxes [Line Items] | |||
Standard income tax rate | 25.00% | ||
CHINA [Member] | Maximum [Member] | |||
Components Of Income Loss Before Income Taxes [Line Items] | |||
Net operating loss carry forward period | 5 years |
Income Taxes (Schedule of Incom
Income Taxes (Schedule of Income Tax Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Provision for income taxes | |||
Current tax - PRC | $ 265 | $ 236 | $ 173 |
Deferred tax | 108 | (92) | (166) |
Effective tax | $ 373 | $ 144 | $ 7 |
Income Taxes (Schedule of Recon
Income Taxes (Schedule of Reconciliation of Provision for Income Taxes Using Statutory Tax Rates to Loss Before Income Taxes and Actual Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Provision for income taxes at statutory tax rate in the PRC | $ (236) | $ 1,105 | $ 1,549 |
Tax rate differential on entities not subject to PRC income tax | 1,281 | (284) | (797) |
Effect of income for which no income tax is chargeable | (850) | (791) | (757) |
Effect of expense for which no income tax is deductible | 139 | 142 | 207 |
Net change in valuation allowances | 39 | (22) | (195) |
Over provision of income tax in previous years | (6) | ||
Effective tax | $ 373 | $ 144 | $ 7 |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Income Tax Assets and Liabilties) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Income Tax Disclosure [Abstract] | ||
Deferred income tax assets | ||
Deferred income tax liabilities | (751) | (659) |
Net deferred income tax liabilities | $ (751) | $ (659) |
Income Taxes (Components of Def
Income Taxes (Components of Deferred Income Tax) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 |
Deferred income tax assets (liabilities): | ||
Net operating loss carry forwards | ||
Provision of employee benefits | 803 | 582 |
Depreciation and amortization | 248 | 85 |
Revenue and cost of sales recognized for financial reporting purpose before being recognized for tax purpose | (1,016) | (1,277) |
Others | (93) | 110 |
Less: Valuation allowances | (197) | (159) |
Net deferred income tax liabilities | $ (751) | $ (659) |
Income Taxes (Schedule of Unrec
Income Taxes (Schedule of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Balance at the beginning of the year | $ 482 | $ 424 | $ 316 |
Increase related to current year tax positions | 253 | 58 | 108 |
Balance at end of the year | $ 735 | $ 482 | $ 424 |
Lease (Narrative) (Details)
Lease (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Future total lease payments | $ 104 | ||
Rental expenses under operating leases | $ 74 | $ 72 | $ 68 |
Factory Buildings [Member] | Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lease term | 1 month | ||
Factory Buildings [Member] | Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lease term | 36 months | ||
Office Space [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Lease term | 2 years |
Lease (Schedule of Future Renta
Lease (Schedule of Future Rental Income) (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Future minimum rental income | |
Year ending March 31, 2021 | $ 420 |
Year ending March 31, 2022 | 6 |
Total minimum future rental income | $ 426 |
Lease (Schedule of Operating Le
Lease (Schedule of Operating Lease Income) (Details) $ in Thousands | 12 Months Ended |
Mar. 31, 2020USD ($) | |
Leases [Abstract] | |
Operating lease income | $ 1,564 |
Other information: | |
Operating cash flows from operating leases as lessor | $ 1,552 |
Lease (Schedule of Operating _2
Lease (Schedule of Operating Lease Cost) (Details) $ in Thousands | 12 Months Ended |
Mar. 31, 2020USD ($) | |
Lease costs | |
Operating lease costs | $ 74 |
Total lease costs | $ 74 |
Lease (Schedule of Supplemental
Lease (Schedule of Supplemental Cash Flow Information Lease) (Details) $ in Thousands | 12 Months Ended |
Mar. 31, 2020USD ($) | |
Cash Paid for amount included in the measurement of lease liabilities | |
Operating cash flows from operating leases | $ 60 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 12 Months Ended |
Mar. 31, 2020USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Capital commitments for purchase of plant and machinery, and leasehold improvement expected to be disbursed | $ 136 |
Employee Benefits (Details)
Employee Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Retirement Benefits [Abstract] | |||
Chinese government state pension expense | $ 640 | $ 751 | $ 800 |
Percentage of average monthly salary used to calculate pension expense, minimum range | 8.00% | 8.00% | 8.00% |
Percentage of average monthly salary used to calculate pension expense, maximum range | 14.00% | 14.00% | 14.00% |
Stock Option Plan (Narrative) (
Stock Option Plan (Narrative) (Details) - USD ($) $ in Thousands | Aug. 07, 2013 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted | 5,669,000 | |||
Expiration period of options | 10 years | |||
Weighted average remaining contractual life | 4 years | |||
Options available for future grant | 1,268,000 | 1,268,000 | ||
Stock-based compensation expense | ||||
Intrinsic value of options outstanding | $ 58 | $ 445 | ||
Number of vested shares | 470,000 | 500,000 | ||
Intrinsic value of options vested | $ 58 | $ 445 | ||
Total intrinsic value of options exercised | $ 26 | |||
Stock Option Plan Three [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock option plan, shares authorized | 3,500,000 | |||
Stock option plan, additional shares authorized | 900,000 |
Stock Option Plan (Schedule of
Stock Option Plan (Schedule of Stock Option Plan Activity) (Details) - $ / shares | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Number of stock options | |||
Outstanding at beginning of the year | 500,000 | 506,000 | 532,000 |
Exercised during the year | (30,000) | ||
Cancelled during the year | (6,000) | (26,000) | |
Outstanding and exercisable at the end of the year | 470,000 | 500,000 | 506,000 |
Weighted average exercise price | |||
Outstanding at beginning of the year | $ 2.1 | $ 2.1 | $ 2.1 |
Exercised during the year | 2.14 | ||
Cancelled during the year | 2.09 | 2.1 | |
Outstanding and exercisable at the end of the year | 2.1 | 2.1 | 2.1 |
Weighted average grant date fair value | |||
Outstanding at beginning of the year | 0.51 | 0.51 | 0.51 |
Exercised during the year | 0.55 | ||
Cancelled during the year | 0.55 | 0.55 | |
Outstanding and exercisable at the end of the year | 0.51 | 0.51 | 0.51 |
Minimum exercise price per share | 2.09 | 2.09 | 2.09 |
Maximum exercise price per share | $ 2.14 | $ 2.14 | $ 2.14 |
Other income (expenses), net (D
Other income (expenses), net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Other Income and Expenses [Abstract] | |||
(Loss) gain on disposal of property, plant and equipment, net | $ 29 | $ (22) | $ (61) |
Exchange loss, net | (505) | (82) | (56) |
Reversal of (provision for) doubtful accounts, net | (297) | (403) | 674 |
Others | 348 | 229 | 337 |
Other income (expenses), net | $ (425) | $ (278) | $ 894 |
Non-operating income (expense_3
Non-operating income (expenses), net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Other Income, Nonoperating [Abstract] | |||
Dividend income from marketable securities | $ 1,049 | $ 738 | $ 859 |
Interest income from bank deposits | 218 | 184 | 267 |
Unrealized gain (loss) from marketable securities | (5,179) | 891 | 1,401 |
Realized gain from sales of marketable securities | 29 | 746 | 609 |
Rental income | 1,564 | 1,455 | 1,111 |
Others | (41) | (130) | 148 |
Non-operating income (expenses), net | $ (2,360) | $ 3,884 | $ 4,395 |
Operating Risk (Details)
Operating Risk (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 | ||||
Concentration Risk [Line Items] | |||||||
Provision for doubtful accounts, net | $ 297 | $ 403 | $ (674) | ||||
Charge off provision for doubtful accounts | 1 | 15 | 308 | ||||
Allowances for doubtful accounts | $ 954 | $ 658 | $ 270 | $ 1,252 | |||
Sales Revenue, Net [Member] | Customer A [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | [1] | [1] | 10.80% | ||||
Sales Revenue, Net [Member] | Customer B [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 12.00% | 11.50% | [1] | ||||
Sales Revenue, Net [Member] | Customer C [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | [1] | [1] | 10.80% | ||||
Sales Revenue, Net [Member] | Customer D [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 11.60% | 12.50% | 12.80% | ||||
Sales Revenue, Net [Member] | Customer E [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 18.70% | 11.10% | 11.90% | ||||
Accounts Receivable [Member] | Customer A [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 10.20% | 14.40% | |||||
Accounts Receivable [Member] | Customer B [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | [1] | 10.80% | |||||
Accounts Receivable [Member] | Customer C [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 14.60% | 26.00% | |||||
Accounts Receivable [Member] | Customer D [Member] | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk, percentage | 10.00% | [1] | |||||
[1] | Less than 10% |
Segment Information (Contributi
Segment Information (Contributions of Profitability Information For Reportable Segments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | $ 65,368 | $ 66,581 | $ 60,667 |
Income (loss) before income taxes | (947) | 4,417 | 6,197 |
Intersegment Eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | (240) | (240) | (454) |
Injection Molded Plastic Parts [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | 25,531 | 28,956 | 28,609 |
Income (loss) before income taxes | (1,197) | 3,686 | 5,405 |
Injection Molded Plastic Parts [Member] | Intersegment Eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | (178) | (178) | (394) |
Electronic Products [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | 40,077 | 37,865 | 32,512 |
Income (loss) before income taxes | 1,544 | 2,077 | 2,047 |
Electronic Products [Member] | Intersegment Eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | (62) | (62) | (60) |
Segment Total [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | 65,608 | 66,821 | 61,121 |
Income (loss) before income taxes | 347 | 5,763 | 7,452 |
Sales eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | (240) | (240) | (454) |
Sales eliminations [Member] | Intersegment Eliminations [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total net sales | 240 | 240 | 454 |
Corporate expenses [Member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Income (loss) before income taxes | $ (1,294) | $ (1,346) | $ (1,255) |
Segment Information (Schedule o
Segment Information (Schedule of Segment Interest Income and Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Interest income from bank deposits | $ 218 | $ 184 | $ 267 |
Interest expenses | |||
Injection Molded Plastic Parts [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income from bank deposits | 204 | 173 | 257 |
Interest expenses | |||
Electronic Products [Member] | |||
Segment Reporting Information [Line Items] | |||
Interest income from bank deposits | 14 | 11 | 10 |
Interest expenses |
Segment Information (Schedule_2
Segment Information (Schedule of Segment Asset Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditure | $ 507 | $ 878 | $ 1,707 |
Depreciation and amortization | 1,973 | 2,114 | 2,138 |
Injection Molded Plastic Parts [Member] | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Identifiable assets | 66,741 | 71,615 | 72,691 |
Capital expenditure | 251 | 711 | 1,644 |
Depreciation and amortization | 1,754 | 1,849 | 1,802 |
Electronic Products [Member] | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Identifiable assets | 28,638 | 28,554 | 27,708 |
Capital expenditure | 256 | 167 | 63 |
Depreciation and amortization | 219 | 265 | 336 |
Segment Total [Member] | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Identifiable assets | 95,379 | 100,169 | 100,399 |
Capital expenditure | 507 | 878 | 1,707 |
Depreciation and amortization | $ 1,973 | $ 2,114 | $ 2,138 |
Segment Information (Schedule_3
Segment Information (Schedule of Net Sales by Geographical Area) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | $ 65,368 | $ 66,581 | $ 60,667 |
Total net sales | 65,368 | 66,581 | 60,667 |
United States [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | 11,228 | 12,862 | 10,630 |
CHINA [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | 27,097 | 30,772 | 30,077 |
UNITED KINGDOM [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | 4,852 | 3,586 | 2,878 |
HONG KONG [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | 6,188 | 4,726 | 4,610 |
Europe [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | 9,827 | 8,186 | 8,304 |
Segments Geographical Location Other [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales from continuing operations | $ 6,176 | $ 6,449 | $ 4,168 |
Segment Information (Schedule_4
Segment Information (Schedule of Segment Indentifiable Assets by Geographical Area) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2014 |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total identifiable assets | $ 95,379 | $ 100,169 | |
Goodwill | $ 393 | ||
Total assets | 95,379 | 100,169 | |
Hong Kong And Macao [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total identifiable assets | 42,412 | 46,077 | |
CHINA [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total identifiable assets | $ 52,967 | $ 54,092 |
Condensed Financial Informati_3
Condensed Financial Information of Deswell Industries, Inc. (Narrative) (Details) ¥ in Thousands, $ in Thousands | 12 Months Ended | ||||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2020CNY (¥) | Mar. 31, 2019CNY (¥) | |
Related Party Transaction [Line Items] | |||||
Net assets of subsidiaries restricted from transfer to the parent company | $ 58,918 | $ 61,240 | |||
China, Yuan Renminbi | |||||
Related Party Transaction [Line Items] | |||||
Net assets of subsidiaries restricted from transfer to the parent company | ¥ | ¥ 413,000 | ¥ 413,000 | |||
Subsidiary of Common Parent [Member] | |||||
Related Party Transaction [Line Items] | |||||
Amount of related party transaction | $ 120 | $ 120 | $ 120 |
Condensed Financial Informati_4
Condensed Financial Information of Deswell Industries, Inc. (Condensed Balance Sheets) (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | Mar. 31, 2017 |
Current assets: | ||||
Cash and cash equivalents | $ 22,514 | $ 14,371 | $ 15,192 | $ 8,078 |
Prepaid expenses and other current assets | 1,752 | 2,006 | ||
Total current assets | 65,369 | 69,958 | ||
Total assets | 95,379 | 100,169 | ||
Current liabilities: | ||||
Accrued payroll and employee benefits | 6,077 | 5,676 | ||
Other accrued liabilities | 1,718 | 1,662 | ||
Total current liabilities | 15,057 | 16,205 | ||
Total shareholders' equity | 80,322 | 83,964 | 81,279 | 76,201 |
Total liabilities and shareholders' equity | 95,379 | 100,169 | ||
Parent Company [Member] | ||||
Current assets: | ||||
Cash and cash equivalents | 902 | 566 | $ 259 | $ 174 |
Prepaid expenses and other current assets | 42 | 41 | ||
Amounts due from subsidiaries | 19,525 | 23,641 | ||
Total current assets | 20,469 | 24,248 | ||
Investments in subsidiaries | 61,563 | 61,447 | ||
Total assets | 82,032 | 85,695 | ||
Current liabilities: | ||||
Accrued payroll and employee benefits | 1,588 | 1,588 | ||
Other accrued liabilities | 122 | 143 | ||
Total current liabilities | 1,710 | 1,731 | ||
Total shareholders' equity | 80,322 | 83,964 | ||
Total liabilities and shareholders' equity | $ 82,032 | $ 85,695 |
Condensed Financial Informati_5
Condensed Financial Information of Deswell Industries, Inc. (Statements of Comprehensive Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Condensed Income Statements, Captions [Line Items] | |||
Income (loss) before income taxes | $ (947) | $ 4,417 | $ 6,197 |
Income taxes | 373 | 144 | 7 |
Net Income (loss) | (1,320) | 4,273 | 6,190 |
Total comprehensive income (loss) | (1,320) | 4,273 | 6,190 |
Parent Company [Member] | |||
Condensed Income Statements, Captions [Line Items] | |||
Equity in earnings of subsidiaries | 115 | 5,778 | 7,586 |
Operating expenses | 1,435 | 1,505 | 1,396 |
Income (loss) before income taxes | (1,320) | 4,273 | 6,190 |
Income taxes | |||
Net Income (loss) | (1,320) | 4,273 | 6,190 |
Share of other comprehensive income (loss) of subsidiaries | |||
Total comprehensive income (loss) | $ (1,320) | $ 4,273 | $ 6,190 |
Condensed Financial Informati_6
Condensed Financial Information of Deswell Industries, Inc. (Condensed Statement of Cashflows) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2018 | |
Cash flows from operating activities | |||
Net income (loss) | $ (1,320) | $ 4,273 | $ 6,190 |
Changes in operating assets and liabilities: | |||
Prepaid expenses and other current assets | 254 | 261 | 152 |
Accrued payroll and employee benefits | 401 | 110 | 923 |
Other accrued liabilities | 56 | (211) | 399 |
Net cash provided by operating activities | 13,121 | 2,166 | 5,699 |
Cash flows from financing activities | |||
Dividends paid | (2,386) | (1,588) | (1,112) |
Net cash used in financing activities | (2,322) | (1,588) | (1,112) |
Net increase in cash and cash equivalents | 8,143 | (821) | 7,114 |
Cash and cash equivalents, beginning of year | 14,371 | 15,192 | 8,078 |
Cash and cash equivalents, end of year | 22,514 | 14,371 | 15,192 |
Parent Company [Member] | |||
Cash flows from operating activities | |||
Net income (loss) | (1,320) | 4,273 | 6,190 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Equity in earnings of subsidiaries | (115) | (5,778) | (7,586) |
Changes in operating assets and liabilities: | |||
Prepaid expenses and other current assets | (1) | 17 | (28) |
Amounts due from subsidiaries | 4,116 | 3,355 | 2,625 |
Accrued payroll and employee benefits | (2) | 2 | |
Other accrued liabilities | (21) | 30 | (6) |
Net cash provided by operating activities | 2,659 | 1,895 | 1,197 |
Cash flows from financing activities | |||
Dividends paid | (2,387) | (1,588) | (1,112) |
Proceeds from exercise of stock options | 64 | ||
Net cash used in financing activities | (2,323) | (1,588) | (1,112) |
Net increase in cash and cash equivalents | 336 | 307 | 85 |
Cash and cash equivalents, beginning of year | 566 | 259 | 174 |
Cash and cash equivalents, end of year | $ 902 | $ 566 | $ 259 |