Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Oct. 31, 2016 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | TRANSACT TECHNOLOGIES INC | ||
Entity Central Index Key | 1,017,303 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 57,100,000 | ||
Entity Common Stock, Shares Outstanding | 7,346,459 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 2,503 | $ 4,473 |
Accounts receivable, net | 10,585 | 7,174 |
Inventories | 9,707 | 11,296 |
Other current assets | 372 | 437 |
Total current assets | 23,167 | 23,380 |
Fixed assets, net | 2,241 | 2,507 |
Goodwill | 2,621 | 2,621 |
Deferred tax assets | 3,432 | 3,145 |
Intangible assets, net of accumulated amortization of $2,779 and $2,326, respectively | 545 | 888 |
Other assets | 36 | 28 |
Total noncurrent assets | 8,875 | 9,189 |
Total assets | 32,042 | 32,569 |
Current liabilities: | ||
Accounts payable | 4,894 | 2,642 |
Accrued liabilities | 2,394 | 2,838 |
Income taxes payable | 19 | 245 |
Deferred revenue | 117 | 604 |
Total current liabilities | 7,424 | 6,329 |
Deferred revenue, net of current portion | 67 | 77 |
Deferred rent, net of current portion | 178 | 189 |
Other liabilities | 264 | 246 |
Total noncurrent liabilities | 509 | 512 |
Total liabilities | 7,933 | 6,841 |
Shareholders' equity: | ||
Preferred Stock, Value, Issued | 0 | 0 |
Common Stock, Value, Issued | 112 | 112 |
Additional paid-in capital | 29,701 | 28,921 |
Retained earnings | 24,157 | 22,956 |
Treasury stock, 3,851,967 and 3,388,589 shares, at cost | (109) | (80) |
Treasury stock, 3,388,589 and 3,222,036 shares, at cost | (29,752) | (26,181) |
Total shareholders' equity | 24,109 | 25,728 |
Total liabilities and shareholders' equity | 32,042 | 32,569 |
Series A Preferred Stock [Member] | ||
Shareholders' equity: | ||
Preferred Stock, Value, Issued | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Intangible assets, accumulated amortization | $ 3,122 | $ 2,779 |
Shareholders' equity: | ||
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 4,800,000 | 4,800,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Common stock, shares issued (in shares) | 11,185,331 | 11,170,881 |
Common stock, shares outstanding (in shares) | 7,333,364 | 7,782,292 |
Treasury stock (in shares) | 3,851,967 | 3,388,589 |
Series A Preferred Stock [Member] | ||
Shareholders' equity: | ||
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 200,000 | 200,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | |||
Net sales | $ 57,235 | $ 59,676 | $ 53,108 |
Cost of sales | 33,436 | 34,698 | 31,397 |
Gross profit | 23,799 | 24,978 | 21,711 |
Operating expenses: | |||
Engineering, design and product development | 4,425 | 3,599 | 4,302 |
Selling and marketing | 6,907 | 7,806 | 7,920 |
General and administrative | 7,267 | 7,367 | 7,756 |
Legal fees and settlement expenses associated with lawsuit (Note 10) | 0 | 1,738 | 5,505 |
Operating expenses | 18,599 | 20,510 | 25,483 |
Operating income (loss) | 5,200 | 4,468 | (3,772) |
Interest and other income (expense): | |||
Interest expense | (33) | (37) | (61) |
Interest income | 7 | 9 | 12 |
Other, net | (4) | 2 | (33) |
Interest and other income (expense) | (30) | (26) | (82) |
Income (loss) before income taxes | 5,170 | 4,442 | (3,854) |
Income tax provision (benefit) | 1,553 | 1,350 | (1,433) |
Net income (loss) | $ 3,617 | $ 3,092 | $ (2,421) |
Net income (loss) per common share: | |||
Basic (in dollars per share) | $ 0.48 | $ 0.40 | $ (0.29) |
Diluted (in dollars per share) | $ 0.47 | $ 0.39 | $ (0.29) |
Shares used in per-share calculation: | |||
Basic (in shares) | 7,610 | 7,818 | 8,307 |
Diluted (in shares) | 7,655 | 7,854 | 8,307 |
Dividends declared and paid per common share (in dollars per share) | $ 0.32 | $ 0.32 | $ 0.31 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) [Abstract] | |||
Net income (loss) | $ 3,617 | $ 3,092 | $ (2,421) |
Foreign currency translation adjustment, net of tax | (29) | (8) | (9) |
Comprehensive income (loss) | $ 3,588 | $ 3,084 | $ (2,430) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total |
Beginning balance at Dec. 31, 2013 | $ 111 | $ 27,674 | $ 27,326 | $ (22,527) | $ (63) | $ 32,521 |
Beginning balance (in shares) at Dec. 31, 2013 | 8,319,316 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares from exercise of stock options | $ 0 | 13 | 0 | 0 | 0 | 13 |
Issuance of shares from exercise of stock options (in shares) | 6,000 | |||||
Issuance of deferred stock units | $ 0 | 100 | 0 | 0 | 0 | 100 |
Issuance of common stock on deferred stock units, net of relinquishments | $ 0 | (44) | 0 | 0 | 0 | (44) |
Issuance of common stock on deferred stock units, net of relinquishments (in shares) | 9,939 | |||||
Tax benefit (shortfall) related to employee stock sales | $ 0 | 7 | 0 | 0 | 0 | 7 |
Purchase of treasury stock | $ 0 | 0 | 0 | (2,634) | 0 | (2,634) |
Purchase of treasury stock (in shares) | (434,998) | |||||
Dividends declared and paid on common stock | $ 0 | 0 | (2,556) | 0 | 0 | (2,556) |
Share-based compensation expense | 0 | 506 | 0 | 0 | 0 | 506 |
Reversal of deferred tax asset in connection with stock options forfeited | 0 | (89) | 0 | 0 | 0 | (89) |
Foreign currency translation adjustment, net of tax | 0 | 0 | 0 | 0 | (9) | (9) |
Net income (loss) | 0 | 0 | (2,421) | 0 | 0 | (2,421) |
Ending balance at Dec. 31, 2014 | $ 111 | 28,167 | 22,349 | (25,161) | (72) | 25,394 |
Ending balance (in shares) at Dec. 31, 2014 | 7,900,257 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares from exercise of stock options | $ 1 | 262 | 0 | 0 | 0 | 263 |
Issuance of shares from exercise of stock options (in shares) | 34,600 | |||||
Issuance of deferred stock units | $ 0 | 160 | 0 | 0 | 0 | 160 |
Issuance of common stock on deferred stock units, net of relinquishments | $ 0 | (39) | 0 | 0 | 0 | (39) |
Issuance of common stock on deferred stock units, net of relinquishments (in shares) | 13,988 | |||||
Tax benefit (shortfall) related to employee stock sales | $ 0 | (48) | 0 | 0 | 0 | (48) |
Purchase of treasury stock | $ 0 | 0 | 0 | (1,020) | 0 | (1,020) |
Purchase of treasury stock (in shares) | (166,553) | |||||
Dividends declared and paid on common stock | $ 0 | 0 | (2,485) | 0 | 0 | (2,485) |
Share-based compensation expense | 0 | 488 | 0 | 0 | 0 | 488 |
Reversal of deferred tax asset in connection with stock options forfeited | 0 | (69) | 0 | 0 | 0 | (69) |
Foreign currency translation adjustment, net of tax | 0 | 0 | 0 | 0 | (8) | (8) |
Net income (loss) | 0 | 0 | 3,092 | 0 | 0 | 3,092 |
Ending balance at Dec. 31, 2015 | $ 112 | 28,921 | 22,956 | (26,181) | (80) | $ 25,728 |
Ending balance (in shares) at Dec. 31, 2015 | 7,782,292 | 11,170,881 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Issuance of shares from exercise of stock options | $ 0 | 23 | 0 | 0 | 0 | $ 23 |
Issuance of shares from exercise of stock options (in shares) | 3,750 | |||||
Issuance of deferred stock units | $ 0 | 202 | 0 | 0 | 0 | 202 |
Issuance of common stock on deferred stock units, net of relinquishments | $ 0 | (51) | 0 | 0 | 0 | (51) |
Issuance of common stock on deferred stock units, net of relinquishments (in shares) | 10,700 | |||||
Tax benefit (shortfall) related to employee stock sales | $ 0 | 1 | 0 | 0 | 0 | 1 |
Purchase of treasury stock | $ 0 | 0 | 0 | (3,571) | 0 | (3,571) |
Purchase of treasury stock (in shares) | (463,378) | |||||
Dividends declared and paid on common stock | $ 0 | 0 | (2,416) | 0 | 0 | (2,416) |
Share-based compensation expense | 0 | 611 | 0 | 0 | 0 | 611 |
Reversal of deferred tax asset in connection with stock options forfeited | 0 | (6) | 0 | 0 | 0 | (6) |
Foreign currency translation adjustment, net of tax | 0 | 0 | 0 | 0 | (29) | (29) |
Net income (loss) | 0 | 0 | 3,617 | 0 | 0 | 3,617 |
Ending balance at Dec. 31, 2016 | $ 112 | $ 29,701 | $ 24,157 | $ (29,752) | $ (109) | $ 24,109 |
Ending balance (in shares) at Dec. 31, 2016 | 7,333,364 | 11,185,331 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net income (loss) | $ 3,617 | $ 3,092 | $ (2,421) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Share-based compensation expense | 611 | 488 | 506 |
Incremental tax benefits from stock options exercised | (1) | (4) | (7) |
Depreciation and amortization | 1,331 | 1,426 | 1,445 |
Deferred income tax provision (benefit) | (295) | 878 | (1,558) |
(Gain) loss on sale of fixed assets | (5) | (4) | 28 |
Foreign currency transaction (gains) losses | 4 | (1) | 7 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (3,434) | 1,916 | 4,139 |
Inventories | 1,580 | 509 | 1,703 |
Prepaid income taxes | (5) | 407 | (98) |
Other current and long term assets | 53 | 50 | 46 |
Accounts payable | 2,255 | 277 | (2,384) |
Accrued lawsuit settlement expenses | 0 | (3,625) | 3,625 |
Accrued liabilities and other liabilities | (1,088) | 138 | 1,022 |
Net cash provided by operating activities | 4,623 | 5,547 | 6,053 |
Cash flows from investing activities: | |||
Capital expenditures | (608) | (959) | (660) |
Proceeds from sale of fixed assets | 8 | 4 | 0 |
Net cash used in investing activities | (600) | (955) | (660) |
Cash flows from financing activities: | |||
Revolving credit line borrowings | 0 | 2,500 | 0 |
Revolving credit line payments | 0 | (2,500) | 0 |
Proceeds from stock option exercises | 23 | 263 | 13 |
Purchases of common stock for treasury | (3,571) | (1,020) | (2,634) |
Payment of dividends on common stock | (2,416) | (2,485) | (2,556) |
Incremental tax benefits from stock options exercised | 1 | 4 | 7 |
Payment of deferred financing costs | 0 | 0 | (8) |
Net cash used in financing activities | (5,963) | (3,238) | (5,178) |
Effect of exchange rate changes on cash and cash equivalents | (30) | (12) | (20) |
Increase (decrease) in cash and cash equivalents | (1,970) | 1,342 | 195 |
Cash and cash equivalents, beginning of period | 4,473 | 3,131 | 2,936 |
Cash and cash equivalents, end of period | 2,503 | 4,473 | 3,131 |
Supplemental cash flow information: | |||
Interest paid | 31 | 34 | 49 |
Income taxes paid | 2,065 | 130 | 173 |
Non-cash capital expenditure items | $ 113 | $ 84 | $ 0 |
Description of business
Description of business | 12 Months Ended |
Dec. 31, 2016 | |
Description of business [Abstract] | |
Description of business | 1. Description of business TransAct Technologies Incorporated ("TransAct" or the "Company"), which has its headquarters in Hamden, CT and its primary operating facility in Ithaca, NY, operates in one operating segment: software-driven technology and printing solutions for high growth markets including restaurant solutions, casino and gaming, lottery, POS automation and banking, oil and gas and mobile markets. Our solutions are designed based on market-specific requirements and are sold under the AccuDate™ Ithaca®, RESPONDER®, Epic, EPICENTRAL TM TM TM |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies [Abstract] | |
Accounting policies | 2. Summary of significant accounting policies Principles of consolidation: Use of estimates : Segment reporting : Cash and cash equivalents : Allowance for doubtful accounts : The following table summarizes the activity recorded in the valuation account for accounts receivable: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 50 $ 100 $ 63 Additions charged to costs and expenses - 7 37 Write-offs - (57 ) - Balance, end of period $ 50 $ 50 $ 100 Inventories: Fixed assets: Leases: Goodwill and Intangible assets : Revenue recognition: We also sell a software solution, EPICENTRALâ„¢, that enables casino operators to create promotional coupons and marketing messages and to print them in real-time at the slot machine. Revenue arrangements for EPICENTRAL TM TM Revenue, inclusive of software license fees, is generally recognized upon installation and formal acceptance by the customer with the exception of any amount allocated to free maintenance which is deferred and recognized over the initial maintenance period, generally one year. For EPICENTRAL TM Revenue related to extended warranty and product maintenance contracts is recognized pursuant to ASC 605-20-25, "Separately Priced Extended Warranty and Product Maintenance Contracts." Pursuant to this provision, revenue related to separately priced product maintenance contracts is deferred and recognized over the term of the maintenance period. We record deferred revenue for advance payments received from customers for maintenance contracts. Our customers have the right to return products that do not function properly within a limited time after delivery. We monitor and track product returns and record a provision for the estimated future returns based on historical experience. Returns have historically been within expectations and the provisions established. We offer some of our customers price protection as an incentive to carry inventory of our product. These price protection plans provide that if we lower prices, we will credit them for the price decrease on inventory they hold. Our customers typically carry limited amounts of inventory, and we infrequently lower prices on current products. As a result, the amounts paid under these plans have not been material. We charge our customers for shipping and handling services. The amounts billed to customers are recorded as revenue when the product ships. Any costs incurred related to these services are included in cost of sales. Concentration of credit risk: Accounts receivable from customers representing 10% or more of total accounts receivable were as follows: December 31, 2016 2015 IGT 34 % 17 % Suzo-Happ 18 % 10 % CMC Daymark 8 % 13 % Panasonic 3 % 11 % Sales to customers representing 10% or more of total net sales were as follows: Year ended December 31, 2016 2015 2014 IGT 26 % 29 % 19 % Suzo-Happ 15 % 14 % 7 % Eurocoin - % - % 11 % Warranty: The following table summarizes the activity recorded in the accrued product warranty liability: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 277 $ 287 $ 366 Warranties issued 254 267 183 Warranty settlements (264 ) (277 ) (262 ) Balance, end of period $ 267 $ 277 $ 287 $169,000 and $164,000 of the accrued product warranty liability were classified as current in Accrued liabilities at December 31, 2016 and 2015, respectively. The remaining $98,000 and $113,000 of the accrued product warranty liability is classified as long-term in Other liabilities. Engineering, design and product development: Costs incurred in researching and developing a computer software product are charged to expense until technological feasibility has been established at which point all material software costs are capitalized within Intangible assets in our Consolidated Balance Sheet until the product is available for general release to customers. While judgment is required in determining when technological feasibility of a product is established, we have determined that it is reached after all high-risk development issues have been documented in a formal detailed plan design. The amortization of these costs will be included in cost of sales over the estimated life of the product. During 2010, we began the development of EPICENTRAL TM Advertising: Income taxes: In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"), which simplifies the presentation of deferred income taxes. ASU 2015-17 requires that deferred tax assets and liabilities be classified as noncurrent in a classified statement of financial position. ASU 2015-17 is effective for financial statements issued for fiscal years beginning after December 15, 2016 (and interim periods within those fiscal years) with early adoption permitted. ASU 2015-17 may be either applied prospectively to all deferred tax assets and liabilities or retrospectively to all periods presented. We have elected to early adopt ASU 2015-17 prospectively in the fourth quarter of 2016. As a result, we have presented all deferred tax assets and liabilities as noncurrent on our consolidated balance sheet as of December 31, 2016, but have not reclassified current deferred tax assets and liabilities on our consolidated balance sheet as of December 31, 2015. There was no impact on our results of operations as a result of the adoption of ASU 2015-17. Foreign currency translation: Share-based payments: We use the Black-Scholes option-pricing model to calculate the fair value of share based awards. The key assumptions for this valuation method include the expected term of the option, stock price volatility, risk-free interest rate, dividend yield, market price of our underlying stock and exercise price. Many of these assumptions are judgmental and highly sensitive in the determination of compensation expense. In addition, we estimate forfeitures when recognizing compensation expense, and we adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative true-up adjustment in the period of change and also impacts the amount of compensation expense to be recognized in future periods. Net income and loss per share: |
Contingent Consideration
Contingent Consideration | 12 Months Ended |
Dec. 31, 2016 | |
Contingent consideration [Abstract] | |
Contingent consideration | 3. Contingent Consideration In connection with a business acquisition on August 19, 2011, whereby we purchased substantially all of the assets of Printrex, Inc. ("Printrex"), we entered into a contingent consideration arrangement with Printrex as part of the acquisition for 30% of the gross profit for a three-year period related to new products under development, less certain other adjustments, beginning on the earlier of 1) January 1, 2012 or 2) the date of first commercial introduction of the new products under development. As of December 31, 2015, the undiscounted fair value related to the contingent liability was estimated to be zero and we did not make a contingent consideration payment. The fair value of the contingent consideration arrangement was $0 at both December 31, 2016 and 2015, which was estimated by applying the income approach. That measure is based on significant inputs that are not observable in the market, which fair value measurement guidance refers to as Level 3 inputs. The fair value of the contingent consideration was decreased by $0, $0 and $60,000, in 2016, 2015 and 2014, respectively, and this credit is included in general and administrative expenses on the Consolidated Statements of Operations. No payments were made under the arrangement during 2015 and 2016 as the contingent consideration measurement period expired on December 31, 2014. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventories [Abstract] | |
Inventories | 4. Inventories, net The components of inventories are: December 31, (In thousands) 2016 2015 Raw materials and purchased component parts 6,298 $ 6,627 Work-in-process 8 1 Finished goods 3,401 4,668 $ 9,707 $ 11,296 |
Fixed assets
Fixed assets | 12 Months Ended |
Dec. 31, 2016 | |
Fixed assets [Abstract] | |
Fixed assets | 5. Fixed assets The components of fixed assets, net are: December 31, (In thousands) 2016 2015 Tooling, machinery and equipment $ 11,035 $ 10,836 Furniture and office equipment 1,630 1,578 Computer software and equipment 6,260 6,037 Leasehold improvements 2,361 2,318 21,286 20,769 Less: Accumulated depreciation and amortization (19,215 ) (18,336 ) 2,071 2,433 Construction in-process 170 74 $ 2,241 $ 2,507 |
Intangible assets
Intangible assets | 12 Months Ended |
Dec. 31, 2016 | |
Intangible assets [Abstract] | |
Intangible assets | 6. Intangible assets Identifiable intangible assets are recorded in Intangible assets in the accompanying Consolidated Balance Sheets and are comprised of the following: December 31, 2016 2015 (In thousands) Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Purchased technology $ 1,604 $ (1,433 ) $ 1,604 $ (1,357 ) Customer relationships 1,300 (1,163 ) 1,300 (946 ) Trademark 480 (257 ) 480 (210 ) Covenant not to compete 146 (146 ) 146 (146 ) Patents 57 (43 ) 57 (40 ) Other 80 (80 ) 80 (80 ) Total $ 3,667 $ (3,122 ) $ 3,667 $ (2,779 ) Amortization expense was $343,000, $454,000 and $515,000 in 2016, 2015 and 2014, respectively. Amortization expense for each of the next five years ending December 31 is expected to be as follows: $236,000 in 2017; $98,000 in 2018; $98,000 in 2019; $82,000 in 2020; $31,000 in 2021 and $0 in 2022. |
Accrued liabilities
Accrued liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Accrued liabilities [Abstract] | |
Accrued liabilities | 7. Accrued liabilities The components of accrued liabilities are: December 31, (In thousands) 2016 2015 Salaries and compensation related $ 1,722 $ 2,209 Warranty 169 164 Professional and consulting 153 159 Other 350 306 $ 2,394 $ 2,838 |
Retirement savings plan
Retirement savings plan | 12 Months Ended |
Dec. 31, 2016 | |
Retirement savings plan [Abstract] | |
Retirement savings plan | 8. Retirement savings plan We maintain a 401(k) plan under which all full-time employees are eligible to participate at the beginning of each month immediately following their date of hire. We match employees' contributions at a rate of 50% of employees' contributions up to the first 6% of the employees' compensation contributed to the 401(k) plan. Our matching contributions were $295,000, $197,000 and $282,000 in 2016, 2015, and 2014, respectively. |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2016 | |
Borrowings [Abstract] | |
Borrowings | 9. Borrowings We maintain a credit facility (the "TD Bank Credit Facility") with TD Bank N.A. ("TD Bank) which provides for a $20,000,000 revolving credit line. On November 26, 2014, we signed an amendment to the TD Bank Credit Facility through November 28, 2017. Borrowings under the revolving credit line bear a floating rate of interest at the prime rate of (1.0)% and are secured by a lien on all of our assets. We also pay a fee of 0.15% on unused borrowings under the revolving credit line. The total deferred financing costs relating to expenses incurred to complete the TD Bank Credit Facility was $8,000 which will be amortized over the three year term. The amendment increased the amount of revolving credit loans we may use to fund future cash dividend payments or treasury share buybacks to $10,000,000 from $5,000,000. The amendment also modified the definition of EBITDA to exclude certain non-recurring expenses, including without limitation, non-recurring litigation and acquisition expenses; and modified the definition of Operating Cash Flow to exclude unfinanced capital expenditures for the quarters ending December 31, 2014, March 31, 2015 and June 30, 2015. The TD Bank Credit Facility imposes certain quarterly financial covenants on us and restricts, among other things, our ability to incur additional indebtedness and the creation of other liens. We were in compliance with all financial covenants of the TD Bank Credit Facility at December 31, 2016. As of December 31, 2016, undrawn commitments under the TD Bank Credit facility were $20,000,000. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and contingencies [Abstract] | |
Commitments and contingencies | 10. Commitments and contingencies On June 8, 2012, Avery Dennison Corporation ("AD") filed a civil complaint against us and a former employee of ours and of AD, in the Court of Common Pleas (the "Court") in Lake County, Ohio. The complaint alleged that we and this former employee misappropriated unspecified trade secrets and confidential information from AD related to the design of our restaurant solutions terminals. The complaint requested a preliminary and permanent injunction against us from manufacturing and selling our Ithaca® 9700 and 9800 restaurant solutions terminals. On July 16, 2012, we filed our answer, affirmative defenses and counterclaims, seeking all available damages including legal fees. A hearing on the plaintiff's motion for preliminary injunction took place in August 2012, and in November 2012, the Court denied this request. AD filed an appeal of the Court's ruling to the Eleventh Appellate District, which heard oral arguments on the appeal on July 16, 2013. On July 23, 2013, AD requested that the Eleventh Appellate District enjoin our further sale and marketing of the restaurant solutions terminals, pending the Court of Appeals' decision. On July 29, 2013, we opposed this request. On October 15, 2013, the Eleventh District Court of Appeals affirmed the lower court's decision in our favor and denied AD's further request of an injunction pending the Court of Appeals' decision. On October 24, 2013, AD filed a motion seeking that the Court of Appeals reconsider its decision. On April 16, 2014, the Court of Appeals denied AD's motion to reconsider its decision. On July 28, 2014, AD filed a motion requesting leave from the Court to file an amended complaint and indicating that it has elected to pursue only its claim for damages, dropping its claim for injunctive relief. On September 4, 2014, the Court granted AD's motion to file an amended complaint. On September 25, 2014, we filed our answer, affirmative defenses and counterclaims with respect to the amended complaint, seeking all available damages including legal fees. On January 30, 2015, we filed a motion for summary judgment seeking judgment in our favor on all counts as to the Company. On the same day, AD filed two motions for partial summary judgment. On February 17, 2015, we opposed both of AD's motions, and AD opposed our motion. On February 23, 2015, the Company filed a reply brief in support of its motion for summary judgment. A trial was scheduled to begin on April 21, 2015, however, on March 25, 2015 the parties executed a confidential settlement agreement and release (the "Settlement Agreement") in which the parties mutually agreed to resolve the dispute that was the subject of the lawsuit filed by AD against the Company to the parties' mutual satisfaction. Under the terms of the Settlement Agreement, we agreed to pay AD $3,600,000 payable on or before April 8, 2015 and also to qualify certain AD labels for use on our restaurant solutions terminals at an estimated cost of $25,000. We made the $3,600,000 payment to AD on April 8, 2015 and borrowed $2,500,000 under our revolving credit facility with TD Bank to fund the payment. We recorded the total expense of $3,625,000 in the fourth quarter 2014 as an operating expense included in the line item "Legal fees and settlement expenses associated with lawsuit" on the Consolidated Statement of Operations and as a current liability included in the line item "Accrued lawsuit settlement expenses" on the Consolidated Balance Sheet. In the second quarter of 2015 we reversed $25,000 of this expense because AD did not provide the label testing information by the due date required per the settlement agreement. At December 31, 2016, we were the lessee on operating leases for equipment and real property. Rent expense was $1,046,000, $932,000 and $918,000 in 2016, 2015, and 2014, respectively. Minimum aggregate rental payments required under operating leases that have initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2016 are as follows: $825,000 in 2017; $777,000 in 2018; $788,000 in 2019; $798,000 in 2020, $478,000 in 2021 and $367,000 thereafter. |
Stock incentive plans
Stock incentive plans | 12 Months Ended |
Dec. 31, 2016 | |
Stock incentive plans [Abstract] | |
Stock incentive plans | 11. Stock incentive plans Stock incentive plans . Under the assumptions indicated below, the weighted-average fair value of stock option grants for 2016, 2015, and 2014 was $1.70, $6.73 and $11.11, respectively. In 2016, we also issued restricted share units for certain executives and directors that vest over a specified period of time, and in some instances require achieving certain performance metrics. The weighted-average fair value of these restricted share units was $7.31. No restricted share units were issued in 2015 or 2014. The table below indicates the key assumptions used in the option valuation calculations for options granted in 2016, 2015, and 2014 and a discussion of our methodology for developing each of the assumptions used in the valuation model: Year ended December 31, 2015 2014 2013 Expected option term (in years) 6.9 6.8 6.6 Expected volatility 38.8 % 50.4 % 53.8 % Risk-free interest rate 1.2 % 1.6 % 1.6 % Dividend yield 4.5 % 4.7 % 2.6 % Expected Option Term Expected Volatility Risk-Free Interest Rate Dividend Yield For 2016, 2015, and 2014, we recorded $611,000, $488,000, and $506,000 of share-based compensation expense, respectively, included primarily in general and administrative expense in our Consolidated Statements of Operations. We also recorded income tax benefits of $184,000, $148,000, and $377,000 in 2016, 2015, and 2014 respectively, related to such share-based compensation. At December 31, 2016, these benefits are recorded as a deferred tax asset in the Consolidated Balance Sheets. Option activity in the 2005 Equity Incentive Plan and 2014 Equity Incentive Plan is summarized below: Stock Options Restricted Share Units Number of Shares Average Price* Number of Units Average Price** Outstanding at December 31, 2015 915,375 $ 8.08 $ - - Granted 233,900 7.17 57,400 7.94 Exercised (3,750 ) 6.11 - - Forfeited (27,000 ) 8.03 - - Expired (44,625 ) 9.49 - - Outstanding at December 31, 2016 1,073,900 $ 7.83 $ 57,400 7.94 * weighted-average exercise price ** weighted-average grant stock price The following summarizes information about equity awards outstanding that are vested and expect to vest and equity awards that are exercisable at December 31, 2016: Equity Awards Vested and Expected to Vest Equity Awards That Are Exercisable Awards Average Price* Aggregate Intrinsic Value Remaining Term** Awards Average Price* Aggregate Intrinsic Value Remaining Term** Stock Options 1,057,720 $ 7.83 $ 183,000 6.0 587,875 $ 7.89 $ 182,000 4.1 Restricted stock units 48,769 - 322,000 2.5 * weighted-average exercise price per share ** weighted-average contractual remaining term in years Shares that are issued upon exercise of employee stock awards are newly issued shares and not issued from treasury stock. As of December 31, 2016, unrecognized compensation cost related to non-vested equity awards granted under our stock incentive plans is approximately $939,000, which is expected to be recognized over a weighted average period of 2.4 years. The total fair value of awards vested during the years ended December 31, 2016, 2015, and 2014 was $961,000, $944,000, and $943,000, respectively. The total intrinsic value (which is the amount by which the stock price exceeded the exercise price on the date of exercise) of stock options exercised during the years ended December 31, 2016, 2015, and 2014 was $6,000, $32,000 and $20,000, respectively. As of December 31, 2016, no restricted stock units have vested. Cash received from option exercises was $23,000, $263,000 and $13,000 for 2016, 2015, and 2014, respectively. We recorded a realized tax benefit in 2016, 2015, and 2014 from equity-based awards of $1,000, $4,000 and $7,000, respectively, related to options exercised which has been included as a component of cash flows from financing activities in the Consolidated Statements of Cash Flows. Restricted stock: We paid a portion of the 2015, 2014 and 2013 incentive bonus for the chief executive officer and chief financial officer in the form of 28,231, 23,578 and 8,663 deferred stock units, respectively, with a corresponding credit recorded to Additional Paid in Capital (net of share relinquishments) in the amounts of $151,000, $121,000 and $56,000 in 2016, 2015, and 2014, respectively. Such deferred stock units were granted in February 2016, February 2015 and February 2014, respectively, and were fully vested at the time of grant. These units will be converted three years from the grant date to shares of the Company's common stock on a one-for-one basis. The weighted average exercise price of the deferred stock units was $7.65. Starting with the 2016 incentive bonus program, all incentive bonus payments are made in cash with no portion of the award paid in deferred stock units. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income taxes [Abstract] | |
Income taxes | 12. Income taxes The components of the income tax provision are as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Current: Federal $ 1,776 $ 450 $ 176 State 70 22 15 Foreign 2 - 12 1,848 472 203 Deferred: Federal (257 ) 843 (1,653 ) State (38 ) 35 17 Foreign - - - (295 ) 878 (1,636 ) Income tax provision (benefit) $ 1,553 $ 1,350 $ (1,433 ) Our effective tax rates were 30.0%, 30.4%, and 37.2% for 2016, 2015, and 2014, respectively. The effective tax rate for 2014 was unusually high due to the impact from the net loss reported for the year ending 2014. At December 31, 2016, we have no federal and no state net operating loss carryforwards and no R&D credit carryforwards. We also have less than $1,000 of state tax credit carryforwards as of December 31, 2016. Foreign loss before taxes was $235,000, $174,000, and $56,000 in 2016, 2015, and 2014, respectively. Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements. Our deferred tax assets and liabilities were comprised of the following: December 31, (In thousands) 2016 2015 Deferred tax assets: Foreign net operating losses $ 423 $ 340 Depreciation 88 - Inventory reserves 1,264 1,312 Deferred revenue 31 25 Warranty reserve 93 95 Stock compensation expense 1,273 1,105 Other accrued compensation 387 475 Foreign tax and other credits - 23 Other liabilities and reserves 329 191 Gross deferred tax assets 3,888 3,566 Valuation allowance (423 ) (340 ) Net deferred tax assets 3,465 3,226 Deferred tax liabilities: Depreciation - 45 Other 33 36 Net deferred tax liabilities 33 81 Total net deferred tax assets 3,432 3,145 As of December 31, 2016 a valuation allowance of $423,000 has been established for foreign net operating loss carryforwards that are not expected to be used. The following table summarizes the activity recorded in the valuation allowance on the deferred tax assets: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 340 $ 282 $ 242 Additions charged to income tax provision 83 58 40 Balance, end of period $ 423 $ 340 $ 282 Differences between the U.S. statutory federal income tax rate and our effective income tax rate are analyzed below: Year Ended December 31, 2016 2015 2014 Federal statutory tax rate 34.0 % 34.0 % 34.0 % Valuation allowance and tax accruals 1.6 1.3 (1.1 ) State income taxes, net of federal income taxes 0.4 0.8 (0.5 ) Uncertain tax positions (0.1 ) (0.3 ) (1.0 ) Miscellaneous permanent items (1.2 ) (0.7 ) (0.3 ) R&D credit (4.6 ) (4.9 ) 6.0 Other (0.1 ) 0.2 0.1 Effective tax rate 30.0 % 30.4 % 37.2 % At December 31, 2016 and 2015, we had $111,000 and $114,000 of total gross unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in any future periods. We are not aware of any events that could occur within the next twelve months that could cause a significant change in the total amount of unrecognized tax benefits. A tabular reconciliation of the gross amounts of unrecognized tax benefits at the beginning and end of the year is as follows: (In thousands) 2016 2015 Unrecognized tax benefits as of January 1 $ 114 $ 124 Tax positions taken during the current period 27 25 Lapse of statute of limitations (30 ) (35 ) Unrecognized tax benefits as of December 31 $ 111 $ 114 We are subject to U.S. federal income tax as well as income tax of certain state and foreign jurisdictions. We have substantially concluded all U.S. federal income tax, state and local, and foreign tax matters through 2012. During 2013, an examination of our 2010 federal tax return was completed. However, our federal tax returns for the years 2013 through 2015 remain open to examination. Various state and foreign tax jurisdiction tax years remain open to examination as well, though we believe that any additional assessment would be immaterial to the Consolidated Financial Statements. We expect $31,000 of the $111,000 of unrecognized tax benefits will reverse in 2017 upon the expiration of the statute of limitations. We recognize interest and penalties related to uncertain tax positions in the income tax provision. As of December 31, 2016 and 2015, we have $18,000 and $19,000, respectively, of accrued interest and penalties related to uncertain tax positions. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings per share [Abstract] | |
Earnings per share | 13. Earnings per share For 2016, 2015, and 2014, earnings per share were computed as follows (in thousands, except per share amounts): Year Ended December 31, 2016 2015 2014 Net income (loss) $ 3,617 $ 3,092 $ (2,421 ) Shares: Basic: Weighted average common shares outstanding 7,610 7,818 8,307 Add: Dilutive effect of outstanding options as determined by the treasury stock method 45 36 - Diluted: Weighted average common and common equivalent shares outstanding 7,655 7,854 8,307 Net income (loss) per common share: Basic $ 0.48 $ 0.40 $ (0.29 ) Diluted 0.47 0.39 (0.29 ) The computation of diluted earnings per share excludes the effect of the potential exercise of stock awards, including stock options, restricted stock units and performance stock awards, when the average market price of the common stock is lower than the exercise price of the related stock award during the period. These outstanding stock awards are not included in the computation of diluted earnings per share because the effect would be anti-dilutive. Anti-dilutive stock awards excluded from the computation of earnings per dilutive share were 831,000, and 735,000, at December 31, 2016 and 2015 respectively. Regarding 2014, when a net loss is reported basic and diluted EPS are calculated using the same method and as a result 84,000 shares were excluded from calculating the diluted weighted average common and common equivalent shares outstanding. |
Stock repurchase program
Stock repurchase program | 12 Months Ended |
Dec. 31, 2016 | |
Stock repurchase program [Abstract] | |
Stock repurchase program | 14. Stock repurchase program On February 25, 2016, our Board of Directors approved a new stock repurchase program (the "Stock Repurchase Program"). Under the Stock Repurchase Program, we are authorized to repurchase up to $5,000,000 of our outstanding shares of common stock from time to time in the open market through December 31, 2017 at prevailing market prices based on market conditions, share price and other factors. We use the cost method to account for treasury stock purchases, under which the price paid for the stock is charged to the treasury stock account. Repurchases of our common stock are accounted for as of the settlement date. From the start of the Stock Repurchase Program on February 25, 2016 through December 31, 2016, we purchased 463,378 shares of our common stock for $3,571,000 at an average price of $7.71 per share. In 2015 and 2014, under a prior repurchase program, we purchased 166,553 and 434,998 shares of our common stock for $1,020,000 and $2,634,000 at an average price of $6.12 and $6.06 per share, respectively. From January 1, 2005 through December 31, 2016, we repurchased a total of 3,851,967 shares of common stock for $29,752,000, at an average price of $7.72 per share. |
Geographic area information
Geographic area information | 12 Months Ended |
Dec. 31, 2016 | |
Geographic area information [Abstract] | |
Geographic area information | 15. Geographic area information Information regarding our operations by geographic area is contained in the following table. These amounts in the geographic area table are based on the location of the customer and asset. Year Ended December 31, (In thousands) 2016 2015 2014 Net sales: United States $ 45,542 $ 45,730 $ 38,567 International 11,693 13,946 14,541 Total $ 57,235 $ 59,676 $ 53,108 Fixed assets, net: United States $ 1,581 $ 1,769 $ 1,490 International 660 738 948 Total $ 2,241 $ 2,507 $ 2,438 Sales to international customers were 20%, 23%, and 27% in 2016, 2015, and 2014 respectively. Sales to Europe represented 56%, 56%, and 49%, sales to the Pacific Rim (which includes Australia and Asia) represented 34%, 34%, and 33%, and sales to Canada represented 8%, 8%, and 5% of total international sales in 2016, 2015, and 2014 respectively. International long-lived assets consist of net fixed assets located at our foreign subsidiary in the United Kingdom as well as our contract manufacturers in China, Thailand, Malaysia and Mexico. |
Quarterly results of operations
Quarterly results of operations (unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly results of operations (unaudited) [Abstract] | |
Quarterly results of operations (unaudited) | 16. Quarterly results of operations (unaudited) Our quarterly results of operations for 2016 and 2015 are as follows: Quarter Ended (In thousands, except per share amounts) March 31 June 30 September 30 December 31 2016: Net sales $ 14,357 $ 14,801 $ 14,474 $ 13,603 Gross profit 5,885 5,983 5,915 6,016 Net income 625 753 883 1,356 Net income per common share: Basic 0.08 0.10 0.12 0.18 Diluted 0.08 0.10 0.12 0.18 2015: Net sales $ 16,164 $ 17,224 $ 14,172 $ 12,116 Gross profit 6,492 7,161 6,291 5,034 Net income 144 1,388 1,028 532 Net income per common share: Basic 0.02 0.18 0.13 0.07 Diluted 0.02 0.18 0.13 0.07 |
Accounting pronouncements
Accounting pronouncements | 12 Months Ended |
Dec. 31, 2016 | |
Accounting pronouncements [Abstract] | |
Accounting pronouncements | 17. Accounting pronouncements In May 2014, the FASB issued Accounting Standards Update (ASU) 2014-09, "Revenue from Contracts with Customers." This ASU is intended to clarify the principles for recognizing revenue by removing inconsistencies in revenue requirements; providing a more robust framework for addressing revenue issues; improving comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets; and providing more useful information to users of financial statements through improved revenue disclosure requirements. In applying the amended guidance, an entity will (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the contract's performance obligations; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The amended guidance applies to all contracts with customers except those that are within the scope of other topics in the FASB Accounting Standards Codification. In April 2015, the FASB voted to defer the effective date of the new revenue recognition standard by one year. As a result, the provisions of this ASU are now effective for interim and annual periods beginning after December 15, 2017. We are currently evaluating the impact this ASU may have on our consolidated financial position, results of operations or cash flows and are currently in the process of engaging a third party to assist management in implementing the new standard. Entities have the option of using either a full retrospective or modified retrospective approach to the amended guidance. The company currently anticipates adopting the amended guidance using the modified retrospective transition approach, with any cumulative effect of initially adopting this standard recognized through retained earnings at the date of adoption. We currently plan to adopt the amended guidance on January 1, 2018 at which time it becomes effective for the Company. As noted above, we are in the process of engaging a third party to assist the Company in implementing the new standard. During 2017, we will further evaluate the impact of the standard, and if needed, establish policies, identify system impacts, integrate the standard into the financial reporting processes and systems, and develop an understanding of the financial impact of this statement on the Company's consolidated financial statements. In July 2015, FASB issued ASU 2015-11, "Simplifying the Measurement of Inventory." This ASU changes the measurement principle for inventory from the lower of cost or market to lower of cost or net realizable value. Net realizable value is defined as the estimated selling prices in the ordinary course of business; less reasonably predictable costs of completion, disposal and transportation. The provisions of this ASU are effective for years beginning after December 15, 2016. This ASU is not expected to have a significant impact on our consolidated financial statements or disclosures. In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"), which simplifies the presentation of deferred income taxes. ASU 2015-17 requires that deferred tax assets and liabilities be classified as noncurrent in a classified statement of financial position. ASU 2015-17 is effective for financial statements issued for fiscal years beginning after December 15, 2016 (and interim periods within those fiscal years) with early adoption permitted. ASU 2015-17 may be either applied prospectively to all deferred tax assets and liabilities or retrospectively to all periods presented. We have elected to early adopt ASU 2015-17 retrospectively in the fourth quarter of 2016. As a result, we have presented all deferred tax assets and liabilities as noncurrent on our consolidated balance sheet as of December 31, 2016 and 2015, We reclassified $1,900,000 and $1,932,000 of our deferred tax asset from current to noncurrent as of December 31, 2016 and 2015, respectively. In February 2016, the FASB issued ASU 2016-02, "Leases." The core principle of this ASU requires that a lessee should recognize the assets and liabilities on the balance sheet and disclose key information about leasing arrangements. The amendments in ASU 2016-02 are effective for fiscal years beginning after December 15, 2018, including interim periods. We are currently evaluating the impact this ASU may have on our consolidated financial position, results of operation or cash flows. In March 2016, the FASB issued ASU 2016-09, "Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting." This ASU is intended to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, classification on the statement of cash flows and accounting for forfeitures. The provisions of this ASU are effective for years beginning after December 15, 2016. We are currently evaluating the impact this ASU may have on our consolidated financial position, results of operation or cash flows. |
Summary of significant accoun25
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies [Abstract] | |
Principles of consolidation | Principles of consolidation: |
Use of estimates | Use of estimates : |
Segment reporting | Segment reporting : |
Cash and cash equivalents | Cash and cash equivalents : |
Allowance for doubtful accounts | Allowance for doubtful accounts : The following table summarizes the activity recorded in the valuation account for accounts receivable: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 50 $ 100 $ 63 Additions charged to costs and expenses - 7 37 Write-offs - (57 ) - Balance, end of period $ 50 $ 50 $ 100 |
Inventories | Inventories: |
Fixed assets | Fixed assets: |
Leases | Leases: |
Goodwill and Intangible assets | Goodwill and Intangible assets : |
Revenue recognition | Revenue recognition: We also sell a software solution, EPICENTRALâ„¢, that enables casino operators to create promotional coupons and marketing messages and to print them in real-time at the slot machine. Revenue arrangements for EPICENTRAL TM TM Revenue, inclusive of software license fees, is generally recognized upon installation and formal acceptance by the customer with the exception of any amount allocated to free maintenance which is deferred and recognized over the initial maintenance period, generally one year. For EPICENTRAL TM Revenue related to extended warranty and product maintenance contracts is recognized pursuant to ASC 605-20-25, "Separately Priced Extended Warranty and Product Maintenance Contracts." Pursuant to this provision, revenue related to separately priced product maintenance contracts is deferred and recognized over the term of the maintenance period. We record deferred revenue for advance payments received from customers for maintenance contracts. Our customers have the right to return products that do not function properly within a limited time after delivery. We monitor and track product returns and record a provision for the estimated future returns based on historical experience. Returns have historically been within expectations and the provisions established. We offer some of our customers price protection as an incentive to carry inventory of our product. These price protection plans provide that if we lower prices, we will credit them for the price decrease on inventory they hold. Our customers typically carry limited amounts of inventory, and we infrequently lower prices on current products. As a result, the amounts paid under these plans have not been material. We charge our customers for shipping and handling services. The amounts billed to customers are recorded as revenue when the product ships. Any costs incurred related to these services are included in cost of sales. |
Concentration of credit risk | Concentration of credit risk: Accounts receivable from customers representing 10% or more of total accounts receivable were as follows: December 31, 2016 2015 IGT 34 % 17 % Suzo-Happ 18 % 10 % CMC Daymark 8 % 13 % Panasonic 3 % 11 % Sales to customers representing 10% or more of total net sales were as follows: Year ended December 31, 2016 2015 2014 IGT 26 % 29 % 19 % Suzo-Happ 15 % 14 % 7 % Eurocoin - % - % 11 % |
Warranty | Warranty: The following table summarizes the activity recorded in the accrued product warranty liability: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 277 $ 287 $ 366 Warranties issued 254 267 183 Warranty settlements (264 ) (277 ) (262 ) Balance, end of period $ 267 $ 277 $ 287 $169,000 and $164,000 of the accrued product warranty liability were classified as current in Accrued liabilities at December 31, 2016 and 2015, respectively. The remaining $98,000 and $113,000 of the accrued product warranty liability is classified as long-term in Other liabilities. |
Engineering, design and product development | Engineering, design and product development: Costs incurred in researching and developing a computer software product are charged to expense until technological feasibility has been established at which point all material software costs are capitalized within Intangible assets in our Consolidated Balance Sheet until the product is available for general release to customers. While judgment is required in determining when technological feasibility of a product is established, we have determined that it is reached after all high-risk development issues have been documented in a formal detailed plan design. The amortization of these costs will be included in cost of sales over the estimated life of the product. During 2010, we began the development of EPICENTRAL TM |
Advertising | Advertising: |
Income taxes | Income taxes: In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes ("ASU 2015-17"), which simplifies the presentation of deferred income taxes. ASU 2015-17 requires that deferred tax assets and liabilities be classified as noncurrent in a classified statement of financial position. ASU 2015-17 is effective for financial statements issued for fiscal years beginning after December 15, 2016 (and interim periods within those fiscal years) with early adoption permitted. ASU 2015-17 may be either applied prospectively to all deferred tax assets and liabilities or retrospectively to all periods presented. We have elected to early adopt ASU 2015-17 prospectively in the fourth quarter of 2016. As a result, we have presented all deferred tax assets and liabilities as noncurrent on our consolidated balance sheet as of December 31, 2016, but have not reclassified current deferred tax assets and liabilities on our consolidated balance sheet as of December 31, 2015. There was no impact on our results of operations as a result of the adoption of ASU 2015-17. Foreign currency translation: |
Foreign currency translation | Foreign Currency Exchange Risk A substantial portion of our sales are denominated in U.S. dollars and, as a result, we have relatively little exposure to foreign currency exchange risk with respect to sales made. This exposure may change over time as business practices evolve and could have a material adverse impact on our financial results in the future. We do not use forward exchange contracts to hedge exposures denominated in foreign currencies or any other derivative financial instruments for trading or speculative purposes. We estimate that the combined translational and transactional impact of a 10% overall movement in exchange rates from December 31, 2016 (principally the U.K. Pound Sterling) would not have a material impact on our results of operations or cash flows. |
Share-based payments | Share-based payments: We use the Black-Scholes option-pricing model to calculate the fair value of share based awards. The key assumptions for this valuation method include the expected term of the option, stock price volatility, risk-free interest rate, dividend yield, market price of our underlying stock and exercise price. Many of these assumptions are judgmental and highly sensitive in the determination of compensation expense. In addition, we estimate forfeitures when recognizing compensation expense, and we adjust our estimate of forfeitures over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative true-up adjustment in the period of change and also impacts the amount of compensation expense to be recognized in future periods. |
Net income and loss per share | Net income and loss per share: |
Summary of significant accoun26
Summary of significant accounting policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Summary of significant accounting policies [Abstract] | |
Allowance for doubtful accounts | The following table summarizes the activity recorded in the valuation account for accounts receivable: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 50 $ 100 $ 63 Additions charged to costs and expenses - 7 37 Write-offs - (57 ) - Balance, end of period $ 50 $ 50 $ 100 |
Concentration of risk | Accounts receivable from customers representing 10% or more of total accounts receivable were as follows: December 31, 2016 2015 IGT 34 % 17 % Suzo-Happ 18 % 10 % CMC Daymark 8 % 13 % Panasonic 3 % 11 % Sales to customers representing 10% or more of total net sales were as follows: Year ended December 31, 2016 2015 2014 IGT 26 % 29 % 19 % Suzo-Happ 15 % 14 % 7 % Eurocoin - % - % 11 % |
Product warranty liability | The following table summarizes the activity recorded in the accrued product warranty liability: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 277 $ 287 $ 366 Warranties issued 254 267 183 Warranty settlements (264 ) (277 ) (262 ) Balance, end of period $ 267 $ 277 $ 287 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventories [Abstract] | |
Components of inventories | The components of inventories are: December 31, (In thousands) 2016 2015 Raw materials and purchased component parts 6,298 $ 6,627 Work-in-process 8 1 Finished goods 3,401 4,668 $ 9,707 $ 11,296 |
Fixed assets (Tables)
Fixed assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fixed assets [Abstract] | |
Components of fixed assets | The components of fixed assets, net are: December 31, (In thousands) 2016 2015 Tooling, machinery and equipment $ 11,035 $ 10,836 Furniture and office equipment 1,630 1,578 Computer software and equipment 6,260 6,037 Leasehold improvements 2,361 2,318 21,286 20,769 Less: Accumulated depreciation and amortization (19,215 ) (18,336 ) 2,071 2,433 Construction in-process 170 74 $ 2,241 $ 2,507 |
Intangible assets (Tables)
Intangible assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Intangible assets [Abstract] | |
Identifiable intangible assets | Identifiable intangible assets are recorded in Intangible assets in the accompanying Consolidated Balance Sheets and are comprised of the following: December 31, 2016 2015 (In thousands) Gross Amount Accumulated Amortization Gross Amount Accumulated Amortization Purchased technology $ 1,604 $ (1,433 ) $ 1,604 $ (1,357 ) Customer relationships 1,300 (1,163 ) 1,300 (946 ) Trademark 480 (257 ) 480 (210 ) Covenant not to compete 146 (146 ) 146 (146 ) Patents 57 (43 ) 57 (40 ) Other 80 (80 ) 80 (80 ) Total $ 3,667 $ (3,122 ) $ 3,667 $ (2,779 ) |
Accrued liabilities (Tables)
Accrued liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accrued liabilities [Abstract] | |
Components of accrued liabilities | The components of accrued liabilities are: December 31, (In thousands) 2016 2015 Salaries and compensation related $ 1,722 $ 2,209 Warranty 169 164 Professional and consulting 153 159 Other 350 306 $ 2,394 $ 2,838 |
Stock incentive plans (Tables)
Stock incentive plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Stock incentive plans [Abstract] | |
Assumptions used in option valuation calculations | Under the assumptions indicated below, the weighted-average fair value of stock option grants for 2016, 2015, and 2014 was $1.70, $6.73 and $11.11, respectively. In 2016, we also issued restricted share units for certain executives and directors that vest over a specified period of time, and in some instances require achieving certain performance metrics. The weighted-average fair value of these restricted share units was $7.31. No restricted share units were issued in 2015 or 2014. The table below indicates the key assumptions used in the option valuation calculations for options granted in 2016, 2015, and 2014 and a discussion of our methodology for developing each of the assumptions used in the valuation model: Year ended December 31, 2015 2014 2013 Expected option term (in years) 6.9 6.8 6.6 Expected volatility 38.8 % 50.4 % 53.8 % Risk-free interest rate 1.2 % 1.6 % 1.6 % Dividend yield 4.5 % 4.7 % 2.6 % Expected Option Term |
Stock option activity | Option activity in the 2005 Equity Incentive Plan and 2014 Equity Incentive Plan is summarized below: Stock Options Restricted Share Units Number of Shares Average Price* Number of Units Average Price** Outstanding at December 31, 2015 915,375 $ 8.08 $ - - Granted 233,900 7.17 57,400 7.94 Exercised (3,750 ) 6.11 - - Forfeited (27,000 ) 8.03 - - Expired (44,625 ) 9.49 - - Outstanding at December 31, 2016 1,073,900 $ 7.83 $ 57,400 7.94 * weighted-average exercise price ** weighted-average grant stock price |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income taxes [Abstract] | |
Components of income tax provision | The components of the income tax provision are as follows: Year Ended December 31, (In thousands) 2016 2015 2014 Current: Federal $ 1,776 $ 450 $ 176 State 70 22 15 Foreign 2 - 12 1,848 472 203 Deferred: Federal (257 ) 843 (1,653 ) State (38 ) 35 17 Foreign - - - (295 ) 878 (1,636 ) Income tax provision (benefit) $ 1,553 $ 1,350 $ (1,433 ) |
Deferred tax assets and liabilities | Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the Consolidated Financial Statements. Our deferred tax assets and liabilities were comprised of the following: December 31, (In thousands) 2016 2015 Deferred tax assets: Foreign net operating losses $ 423 $ 340 Depreciation 88 - Inventory reserves 1,264 1,312 Deferred revenue 31 25 Warranty reserve 93 95 Stock compensation expense 1,273 1,105 Other accrued compensation 387 475 Foreign tax and other credits - 23 Other liabilities and reserves 329 191 Gross deferred tax assets 3,888 3,566 Valuation allowance (423 ) (340 ) Net deferred tax assets 3,465 3,226 Deferred tax liabilities: Depreciation - 45 Other 33 36 Net deferred tax liabilities 33 81 Total net deferred tax assets 3,432 3,145 |
Valuation allowance on deferred tax assets | As of December 31, 2016 a valuation allowance of $423,000 has been established for foreign net operating loss carryforwards that are not expected to be used. The following table summarizes the activity recorded in the valuation allowance on the deferred tax assets: Year ended December 31, (In thousands) 2016 2015 2014 Balance, beginning of period $ 340 $ 282 $ 242 Additions charged to income tax provision 83 58 40 Balance, end of period $ 423 $ 340 $ 282 |
Effective tax rate reconciliation | Differences between the U.S. statutory federal income tax rate and our effective income tax rate are analyzed below: Year Ended December 31, 2016 2015 2014 Federal statutory tax rate 34.0 % 34.0 % 34.0 % Valuation allowance and tax accruals 1.6 1.3 (1.1 ) State income taxes, net of federal income taxes 0.4 0.8 (0.5 ) Uncertain tax positions (0.1 ) (0.3 ) (1.0 ) Miscellaneous permanent items (1.2 ) (0.7 ) (0.3 ) R&D credit (4.6 ) (4.9 ) 6.0 Other (0.1 ) 0.2 0.1 Effective tax rate 30.0 % 30.4 % 37.2 % |
Unrecognized tax benefits | At December 31, 2016 and 2015, we had $111,000 and $114,000 of total gross unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in any future periods. We are not aware of any events that could occur within the next twelve months that could cause a significant change in the total amount of unrecognized tax benefits. A tabular reconciliation of the gross amounts of unrecognized tax benefits at the beginning and end of the year is as follows: (In thousands) 2016 2015 Unrecognized tax benefits as of January 1 $ 114 $ 124 Tax positions taken during the current period 27 25 Lapse of statute of limitations (30 ) (35 ) Unrecognized tax benefits as of December 31 $ 111 $ 114 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings per share [Abstract] | |
Earnings per share | For 2016, 2015, and 2014, earnings per share were computed as follows (in thousands, except per share amounts): Year Ended December 31, 2016 2015 2014 Net income (loss) $ 3,617 $ 3,092 $ (2,421 ) Shares: Basic: Weighted average common shares outstanding 7,610 7,818 8,307 Add: Dilutive effect of outstanding options as determined by the treasury stock method 45 36 - Diluted: Weighted average common and common equivalent shares outstanding 7,655 7,854 8,307 Net income (loss) per common share: Basic $ 0.48 $ 0.40 $ (0.29 ) Diluted 0.47 0.39 (0.29 ) |
Geographic area information (Ta
Geographic area information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Geographic area information [Abstract] | |
Net sales and fixed assets by geographic area | Information regarding our operations by geographic area is contained in the following table. These amounts in the geographic area table are based on the location of the customer and asset. Year Ended December 31, (In thousands) 2016 2015 2014 Net sales: United States $ 45,542 $ 45,730 $ 38,567 International 11,693 13,946 14,541 Total $ 57,235 $ 59,676 $ 53,108 Fixed assets, net: United States $ 1,581 $ 1,769 $ 1,490 International 660 738 948 Total $ 2,241 $ 2,507 $ 2,438 |
Quarterly results of operatio35
Quarterly results of operations (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly results of operations (unaudited) [Abstract] | |
Quarterly results of operations | Our quarterly results of operations for 2016 and 2015 are as follows: Quarter Ended (In thousands, except per share amounts) March 31 June 30 September 30 December 31 2016: Net sales $ 14,357 $ 14,801 $ 14,474 $ 13,603 Gross profit 5,885 5,983 5,915 6,016 Net income 625 753 883 1,356 Net income per common share: Basic 0.08 0.10 0.12 0.18 Diluted 0.08 0.10 0.12 0.18 2015: Net sales $ 16,164 $ 17,224 $ 14,172 $ 12,116 Gross profit 6,492 7,161 6,291 5,034 Net income 144 1,388 1,028 532 Net income per common share: Basic 0.02 0.18 0.13 0.07 Diluted 0.02 0.18 0.13 0.07 |
Description of business (Detail
Description of business (Details) | 12 Months Ended |
Dec. 31, 2016Segment | |
Description of business [Abstract] | |
Number of operating segments | 1 |
Summary of significant accoun37
Summary of significant accounting policies, Segment reporting (Details) | 12 Months Ended |
Dec. 31, 2016Segment | |
Segment reporting [Abstract] | |
Number of business segments | 1 |
Summary of significant accoun38
Summary of significant accounting policies, Allowance for doubtful accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for doubtful accounts [Roll Forward] | |||
Balance, beginning of period | $ 50 | $ 100 | $ 63 |
Additions charged to costs and expenses | 0 | 7 | 37 |
Write-offs | 0 | (57) | 0 |
Balance, end of period | $ 50 | $ 50 | $ 100 |
Summary of significant accoun39
Summary of significant accounting policies, Fixed assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Fixed assets [Abstract] | |||
Depreciation expense | $ 987 | $ 972 | $ 925 |
Tooling [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 5 years | ||
Machinery and Equipment [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 10 years | ||
Furniture and Office Equipment [Member] | Minimum [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 5 years | ||
Furniture and Office Equipment [Member] | Maximum [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 10 years | ||
Computer Software and Equipment [Member] | Minimum [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 3 years | ||
Computer Software and Equipment [Member] | Maximum [Member] | |||
Fixed assets [Abstract] | |||
Estimated useful life | 7 years |
Summary of significant accoun40
Summary of significant accounting policies, Concentration of credit risk (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounts Receivable [Member] | IGT [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 34.00% | 17.00% | |
Accounts Receivable [Member] | CMC Daymark [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 8.00% | 13.00% | |
Accounts Receivable [Member] | Panasonic [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 3.00% | 11.00% | |
Accounts Receivable [Member] | Suzo-Happ [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 18.00% | 10.00% | |
Sales [Member] | IGT [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 26.00% | 29.00% | 19.00% |
Sales [Member] | Suzo-Happ [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 15.00% | 14.00% | 7.00% |
Sales [Member] | Eurocoin [Member] | |||
Concentration of credit risk [Abstract] | |||
Concentration risk percentage | 0.00% | 0.00% | 11.00% |
Summary of significant accoun41
Summary of significant accounting policies, Warranty (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accrued product warranty liability [Roll Forward] | |||
Balance, beginning of period | $ 277 | $ 287 | $ 366 |
Warranties issued | 254 | 267 | 183 |
Warranty settlements | (264) | (277) | (262) |
Balance, end of period | 267 | 277 | $ 287 |
Accrued product warranty liability, current | 169 | 164 | |
Accrued product warranty liability, long-term | $ 98 | $ 113 | |
Maximum [Member] | |||
Warranty [Abstract] | |||
Product warranty period | 36 months |
Summary of significant accoun42
Summary of significant accounting policies, Engineering, design and product development (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Engineering, design and product development [Abstract] | |||
Research and development expense | $ 4,425 | $ 3,599 | $ 4,302 |
Unamortized development costs of software | 2 | 31 | |
Capitalized computer software, amortization | $ 29 | $ 138 | $ 201 |
Maximum [Member] | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Weighted-average amortization period of unamortized capitalized software | 1 year |
Summary of significant accoun43
Summary of significant accounting policies, Advertising (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Advertising [Abstract] | |||
Advertising expense | $ 703 | $ 858 | $ 1,191 |
Contingent Consideration (Detai
Contingent Consideration (Details) - USD ($) | Aug. 19, 2011 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Contingent consideration [Abstract] | ||||
Undiscounted fair value related to contingent liability | $ 0 | $ 0 | ||
Decrease in fair value of contingent consideration | 0 | $ 0 | $ 60,000 | |
Payments made under contingent consideration arrangement | $ 0 | |||
Printrex [Member] | ||||
Contingent consideration [Abstract] | ||||
Percentage of gross profit paid as contingent consideration | 30.00% | |||
Term of contingent consideration arrangement | 3 years |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventories [Abstract] | ||
Raw materials and purchased component parts | $ 6,298 | $ 6,627 |
Work-in-process | 8 | 1 |
Finished goods | 3,401 | 4,668 |
Inventories | $ 9,707 | $ 11,296 |
Fixed assets (Details)
Fixed assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Fixed assets [Abstract] | |||
Fixed assets | $ 21,286 | $ 20,769 | |
Less: Accumulated depreciation and amortization | (19,215) | (18,336) | |
Fixed assets, net | 2,241 | 2,507 | $ 2,438 |
Tooling, Machinery and Equipment [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets | 11,035 | 10,836 | |
Furniture and Office Equipment [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets | 1,630 | 1,578 | |
Computer Software and Equipment [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets | 6,260 | 6,037 | |
Leasehold Improvements [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets | 2,361 | 2,318 | |
Fixed Assets, Excluding Construction in-Process [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets, net | 2,071 | 2,433 | |
Construction in-Process [Member] | |||
Fixed assets [Abstract] | |||
Fixed assets | $ 170 | $ 74 |
Intangible assets (Details)
Intangible assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Identifiable intangible assets [Abstract] | |||
Gross amount | $ 3,667 | $ 3,667 | |
Accumulated amortization | (3,122) | (2,779) | |
Amortization expense | 343 | 454 | $ 515 |
Future amortization expense [Abstract] | |||
2,016 | 236 | ||
2,017 | 98 | ||
2,018 | 98 | ||
2,019 | 82 | ||
2,020 | 31 | ||
2,021 | 0 | ||
Purchased Technology [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 1,604 | 1,604 | |
Accumulated amortization | (1,433) | (1,357) | |
Customer Relationships [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 1,300 | 1,300 | |
Accumulated amortization | (1,163) | (946) | |
Trademarks [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 480 | 480 | |
Accumulated amortization | (257) | (210) | |
Covenant Not to Compete [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 146 | 146 | |
Accumulated amortization | (146) | (146) | |
Patents [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 57 | 57 | |
Accumulated amortization | (43) | (40) | |
Other [Member] | |||
Identifiable intangible assets [Abstract] | |||
Gross amount | 80 | 80 | |
Accumulated amortization | $ (80) | $ (80) |
Accrued liabilities (Details)
Accrued liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Accrued liabilities [Abstract] | ||
Salaries and compensation related | $ 1,722 | $ 2,209 |
Warranty | 169 | 164 |
Professional and consulting | 153 | 159 |
Other | 350 | 306 |
Accrued liabilities | $ 2,394 | $ 2,838 |
Retirement savings plan (Detail
Retirement savings plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Retirement savings plan [Abstract] | |||
Employer matching contribution percentage | 50.00% | ||
Employee's contribution percentage for match | 6.00% | ||
Amount of matching contribution | $ 295 | $ 197 | $ 282 |
Borrowings (Details)
Borrowings (Details) - TD Bank [Member] - Revolving Credit Facility [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Nov. 26, 2014 | Nov. 25, 2014 | |
Credit Facility [Abstract] | |||
Maximum borrowing capacity | $ 20,000 | ||
Maturity date | Nov. 28, 2017 | ||
Percentage fee on unused borrowings | 0.15% | ||
Deferred financing costs | $ 8 | ||
Term of credit facility | 3 years | ||
Loans used to fund future cash dividend payments or treasury share buybacks | $ 10,000 | $ 5,000 | |
Undrawn commitments | $ 20,000 | ||
Prime Rate [Member] | |||
Credit Facility [Abstract] | |||
Basis spread on variable rate | (1.00%) |
Commitments and contingencies (
Commitments and contingencies (Details) - USD ($) $ in Thousands | Apr. 08, 2015 | Mar. 25, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Litigation settlement [Abstract] | |||||||
Revolving credit line borrowings | $ 0 | $ 2,500 | $ 0 | ||||
Settlement expenses associated with lawsuit | 0 | 1,738 | 5,505 | ||||
TD Bank [Member] | Revolving Credit Facility [Member] | |||||||
Litigation settlement [Abstract] | |||||||
Revolving credit line borrowings | $ 2,500 | ||||||
Equipment and Real Property [Member] | |||||||
Rent expense under operating leases [Abstract] | |||||||
Rent expense under operating leases | 1,046 | $ 932 | $ 918 | ||||
Future minimum rental payments under operating leases [Abstract] | |||||||
2,016 | 825 | ||||||
2,017 | 777 | ||||||
2,018 | 788 | ||||||
2,019 | 798 | ||||||
2,020 | 478 | ||||||
Thereafter | $ 367 | ||||||
Civil Complaint filed by Avery Dennison Corporation [Member] | Settled Litigation [Member] | |||||||
Litigation settlement [Abstract] | |||||||
Payment for litigation settlement | $ 3,600 | ||||||
Settlement expenses associated with lawsuit | $ (25) | $ 3,625 | |||||
Civil Complaint filed by Avery Dennison Corporation [Member] | Settled Litigation [Member] | Misappropriation of Unspecified Trade Secrets and Confidential Information [Member] | |||||||
Litigation settlement [Abstract] | |||||||
Litigation settlement amount | $ 3,600 | ||||||
Civil Complaint filed by Avery Dennison Corporation [Member] | Settled Litigation [Member] | Qualification of Certain Labels for Use on Food Safety Terminals [Member] | |||||||
Litigation settlement [Abstract] | |||||||
Litigation settlement amount | $ 25 |
Stock incentive plans, Stock in
Stock incentive plans, Stock incentive plans (Details) | 12 Months Ended | ||
Dec. 31, 2016Incentive$ / sharesshares | Dec. 31, 2015$ / shares | Dec. 31, 2014$ / shares | |
Stock incentive plans [Abstract] | |||
Number of primary stock incentive plans | Incentive | 2 | ||
Stock Options [Member] | |||
Stock incentive plans [Abstract] | |||
Exercise prices of options granted equals percentage of fair market value of common stock | 100.00% | ||
Term of award | 10 years | ||
Weighted average fair value of stock option grants (in dollars per share) | $ / shares | $ 1.70 | $ 6.73 | $ 11.11 |
Assumptions used in valuation model [Abstract] | |||
Expected option term | 6 years 10 months 24 days | 6 years 9 months 18 days | 6 years 7 months 6 days |
Expected volatility | 38.80% | 50.40% | 53.80% |
Risk-free interest rate | 1.20% | 1.60% | 1.60% |
Dividend yield | 4.50% | 4.70% | 2.60% |
Stock Options [Member] | Minimum [Member] | |||
Stock incentive plans [Abstract] | |||
Vesting period | 2 years | ||
Stock Options [Member] | Maximum [Member] | |||
Stock incentive plans [Abstract] | |||
Vesting period | 5 years | ||
Restricted Stock Units (RSUs) [Member] | |||
Stock incentive plans [Abstract] | |||
Weighted average fair value of stock option grants (in dollars per share) | $ / shares | $ 7.31 | ||
2014 Equity Incentive Plan [Member] | |||
Stock incentive plans [Abstract] | |||
Number of shares authorized (in shares) | shares | 600,000 | ||
Number of shares available for grant (in shares) | shares | 25,816 |
Stock incentive plans, Share-ba
Stock incentive plans, Share-based compensation expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based compensation [Abstract] | |||
Income tax benefit from share-based compensation expense | $ 184 | $ 148 | $ 377 |
General and Administrative Expense [Member] | |||
Share-based compensation [Abstract] | |||
Share-based compensation expense | $ 611 | $ 488 | $ 506 |
Stock incentive plans, Stock op
Stock incentive plans, Stock options (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Number of shares [Roll Forward] | |||
Options vested or expected to vest (in shares) | 48,769 | ||
Weighted average remaining contractual term [Abstract] | |||
Options vested or expected to vest | 2 years 6 months | ||
Aggregate intrinsic value [Abstract] | |||
Unrecognized compensation cost related to stock options | $ 939,000 | ||
Weighted average period to recognize compensation cost not yet recognized | 2 years 4 months 24 days | ||
Intrinsic value of stock options exercised | $ 6,000 | $ 32,000 | $ 20,000 |
Fair value of all awards vested | 961,000 | 944,000 | 943,000 |
Cash received from exercise of stock options | 23,000 | 263,000 | 13,000 |
Tax benefit realized from equity-based awards | $ 1,000 | $ 4,000 | $ 7,000 |
Stock Options [Member] | |||
Number of shares [Roll Forward] | |||
Options exercisable, end of period (in shares) | 587,875 | ||
Options vested or expected to vest (in shares) | 1,057,720 | ||
2005 Equity Incentive Plan and 2014 Equity Incentive Plan [Member] | |||
Number of shares [Roll Forward] | |||
Outstanding, beginning of period (in shares) | 0 | ||
Granted (in shares) | 57,400 | ||
Exercised (in shares) | 0 | ||
Forfeited (in shares) | 0 | ||
Expired (in shares) | 0 | ||
Outstanding, end of period (in shares) | 57,400 | 0 | |
Weighted average exercise price [Abstract] | |||
Outstanding, beginning of period (in dollars per share) | $ 0 | ||
Granted (in dollars per share) | 7.94 | ||
Exercised (in dollars per share) | 0 | ||
Forfeited (in dollars per share) | 0 | ||
Expired (in dollars per share) | 0 | ||
Outstanding, end of period (in dollars per share) | 7.94 | $ 0 | |
Options vested or expected to vest (in dollars per share) | $ 0 | ||
Aggregate intrinsic value [Abstract] | |||
Options vested or expected to vest | $ 322,000 | ||
2005 Equity Incentive Plan and 2014 Equity Incentive Plan [Member] | Stock Options [Member] | |||
Number of shares [Roll Forward] | |||
Outstanding, beginning of period (in shares) | 915,375 | ||
Granted (in shares) | 233,900 | ||
Exercised (in shares) | (3,750) | ||
Forfeited (in shares) | (27,000) | ||
Expired (in shares) | (44,625) | ||
Outstanding, end of period (in shares) | 1,073,900 | 915,375 | |
Weighted average exercise price [Abstract] | |||
Outstanding, beginning of period (in dollars per share) | $ 8.08 | ||
Granted (in dollars per share) | 7.17 | ||
Exercised (in dollars per share) | 6.11 | ||
Forfeited (in dollars per share) | 8.03 | ||
Expired (in dollars per share) | 9.49 | ||
Outstanding, end of period (in dollars per share) | 7.83 | $ 8.08 | |
Options exercisable, end of period (in dollars per share) | 7.89 | ||
Options vested or expected to vest (in dollars per share) | $ 7.83 | ||
Weighted average remaining contractual term [Abstract] | |||
Options exercisable, end of period | 4 years 1 month 6 days | ||
Options vested or expected to vest | 6 years | ||
Aggregate intrinsic value [Abstract] | |||
Options exercisable, end of period | $ 182,000 | ||
Options vested or expected to vest | $ 183,000 |
Stock incentive plans, Restrict
Stock incentive plans, Restricted stock (Details) - Restricted Stock [Member] - CEO and CFO [Member] - USD ($) $ / shares in Units, $ in Thousands | Mar. 25, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Restricted stock [Abstract] | ||||||
Deferred stock units issued for incentive bonus (in shares) | 28,231 | 23,578 | 8,663 | |||
Deferred compensation expense | $ 151 | $ 121 | $ 56 | |||
Term of award | 3 years | |||||
Weighted average exercise price of deferred stock units (in dollars per share) | $ 7.65 |
Income taxes, Components of inc
Income taxes, Components of income tax provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current [Abstract] | |||
Federal | $ 1,776 | $ 450 | $ 176 |
State | 70 | 22 | 15 |
Foreign | 2 | 0 | 12 |
Income taxes current | 1,848 | 472 | 203 |
Deferred [Abstract] | |||
Federal | (257) | 843 | (1,653) |
State | (38) | 35 | 17 |
Foreign | 0 | 0 | 0 |
Income taxes deferred | (295) | 878 | (1,558) |
Income tax (benefit) provision | 1,553 | 1,350 | (1,433) |
Income taxes [Abstract] | |||
Foreign loss before taxes | 235 | $ (174) | $ (56) |
Federal [Member] | |||
Income taxes [Abstract] | |||
Net operating loss carryforward | 0 | ||
State [Member] | |||
Income taxes [Abstract] | |||
Net operating loss carryforward | 1 | ||
Tax credit carryforward | 0 | ||
R&D Credit [Member] | |||
Income taxes [Abstract] | |||
Tax credit carryforward | $ 0 |
Income taxes, Deferred tax asse
Income taxes, Deferred tax assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets [Abstract] | ||
Foreign net operating losses | $ 423 | $ 340 |
Depreciation | 88 | 0 |
Inventory reserves | 1,264 | 1,312 |
Deferred revenue | 31 | 25 |
Warranty reserve | 93 | 95 |
Stock compensation expense | 1,273 | 1,105 |
Other accrued compensation | 387 | 475 |
Foreign tax and other credits | 0 | 23 |
Other liabilities and reserves | 329 | 191 |
Gross deferred tax assets | 3,888 | 3,566 |
Valuation allowance | (423) | (340) |
Net deferred tax assets | 3,465 | 3,226 |
Deferred tax liabilities [Abstract] | ||
Depreciation | 0 | 45 |
Other | 33 | 36 |
Net deferred tax liabilities | 33 | 81 |
Total net deferred tax assets | $ 3,432 | $ 3,145 |
Income taxes, Valuation allowan
Income taxes, Valuation allowance on deferred tax assets (Details) - Foreign Net Operating Loss Carryforwards [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Valuation allowance [Roll Forward] | |||
Balance, beginning of period | $ 340 | $ 282 | $ 242 |
Additions charged to income tax provision | 83 | 58 | 40 |
Balance, end of period | $ 423 | $ 340 | $ 282 |
Income taxes, Effective tax rat
Income taxes, Effective tax rate reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Effective tax rate reconciliation [Abstract] | |||
Federal statutory tax rate | 34.00% | 34.00% | 34.00% |
Valuation allowance and tax accruals | 1.60% | 1.30% | (1.10%) |
State income taxes, net of federal income taxes | 0.40% | 0.80% | (0.50%) |
Uncertain tax positions | (0.10%) | (0.30%) | (1.00%) |
Miscellaneous permanent items | (1.20%) | (0.70%) | (0.30%) |
R&D credit | (4.60%) | (4.90%) | 6.00% |
Other | (0.10%) | 0.20% | 0.10% |
Effective tax rate | 30.00% | 30.40% | 37.20% |
Income taxes, Unrecognized tax
Income taxes, Unrecognized tax benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Unrecognized tax benefits [Roll Forward] | ||
Unrecognized tax benefits, beginning of period | $ 114 | $ 124 |
Tax positions taken during the current period | 27 | 25 |
Lapse of statute of limitations | (30) | (35) |
Unrecognized tax benefits, end of period | 111 | 114 |
Accrued interest and penalties related to uncertain tax positions | $ 18 | $ 19 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Earnings per share [Abstract] | |||||||||||
Net income (loss) | $ 1,356 | $ 883 | $ 753 | $ 625 | $ 532 | $ 1,028 | $ 1,388 | $ 144 | $ 3,617 | $ 3,092 | $ (2,421) |
Shares [Abstract] | |||||||||||
Basic: Weighted average common shares outstanding (in shares) | 7,610 | 7,818 | 8,307 | ||||||||
Add: Dilutive effect of outstanding options as determined by the treasury stock method (in shares) | 45 | 36 | 0 | ||||||||
Diluted: Weighted average common and common equivalent shares outstanding (in shares) | 7,655 | 7,854 | 8,307 | ||||||||
Net income (loss) per common share: | |||||||||||
Basic (in dollars per share) | $ 0.18 | $ 0.12 | $ 0.10 | $ 0.08 | $ 0.07 | $ 0.13 | $ 0.18 | $ 0.02 | $ 0.48 | $ 0.40 | $ (0.29) |
Diluted (in dollars per share) | $ 0.18 | $ 0.12 | $ 0.10 | $ 0.08 | $ 0.07 | $ 0.13 | $ 0.18 | $ 0.02 | $ 0.47 | $ 0.39 | $ (0.29) |
Earnings per share [Abstract] | |||||||||||
Anti-dilutive securities excluded from computation of earnings per dilutive share (in shares) | 831 | 735 |
Stock repurchase program (Detai
Stock repurchase program (Details) - USD ($) $ / shares in Units, $ in Thousands | 5 Months Ended | 7 Months Ended | 10 Months Ended | 144 Months Ended | |
Dec. 31, 2014 | Jul. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2016 | Feb. 25, 2016 | |
Stock Repurchase Program [Member] | |||||
Stock repurchase program [Abstract] | |||||
Common stock repurchased (in shares) | 434,998 | 166,553 | 463,378 | 3,851,967 | |
Value of common stock repurchased | $ 2,634 | $ 1,020 | $ 3,571 | $ 29,752 | |
Average purchase price of common stock repurchased (in dollars per share) | $ 6.06 | $ 6.12 | $ 7.71 | $ 7.72 | |
New Stock Repurchase Program [Member] | Maximum [Member] | Subsequent Event [Member] | |||||
Stock repurchase program [Abstract] | |||||
Authorized value of common stock to be repurchased | $ 5,000 |
Geographic area information (De
Geographic area information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Net sales [Abstract] | |||||||||||
Net sales | $ 13,603 | $ 14,474 | $ 14,801 | $ 14,357 | $ 12,116 | $ 14,172 | $ 17,224 | $ 16,164 | $ 57,235 | $ 59,676 | $ 53,108 |
Fixed assets, net [Abstract] | |||||||||||
Fixed assets, net | 2,507 | 2,438 | $ 2,241 | $ 2,507 | $ 2,438 | ||||||
International [Member] | |||||||||||
Fixed assets, net [Abstract] | |||||||||||
Concentration risk percentage | 20.00% | 23.00% | 27.00% | ||||||||
Europe [Member] | |||||||||||
Fixed assets, net [Abstract] | |||||||||||
Concentration risk percentage | 56.00% | 56.00% | 49.00% | ||||||||
Pacific Rim [Member] | |||||||||||
Fixed assets, net [Abstract] | |||||||||||
Concentration risk percentage | 34.00% | 34.00% | 33.00% | ||||||||
Canada [Member] | |||||||||||
Fixed assets, net [Abstract] | |||||||||||
Concentration risk percentage | 8.00% | 8.00% | 5.00% | ||||||||
Reportable Geographical Components [Member] | United States [Member] | |||||||||||
Net sales [Abstract] | |||||||||||
Net sales | $ 45,542 | $ 45,730 | $ 38,567 | ||||||||
Fixed assets, net [Abstract] | |||||||||||
Fixed assets, net | 1,769 | 1,490 | 1,581 | 1,769 | 1,490 | ||||||
Reportable Geographical Components [Member] | International [Member] | |||||||||||
Net sales [Abstract] | |||||||||||
Net sales | 11,693 | 13,946 | 14,541 | ||||||||
Fixed assets, net [Abstract] | |||||||||||
Fixed assets, net | $ 738 | $ 948 | $ 660 | $ 738 | $ 948 |
Quarterly results of operatio64
Quarterly results of operations (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Quarterly results of operations (unaudited) [Abstract] | |||||||||||
Net sales | $ 13,603 | $ 14,474 | $ 14,801 | $ 14,357 | $ 12,116 | $ 14,172 | $ 17,224 | $ 16,164 | $ 57,235 | $ 59,676 | $ 53,108 |
Gross profit | 6,016 | 5,915 | 5,983 | 5,885 | 5,034 | 6,291 | 7,161 | 6,492 | 23,799 | 24,978 | 21,711 |
Net income (loss) | $ 1,356 | $ 883 | $ 753 | $ 625 | $ 532 | $ 1,028 | $ 1,388 | $ 144 | $ 3,617 | $ 3,092 | $ (2,421) |
Net income (loss) per common share: | |||||||||||
Basic (in dollars per share) | $ 0.18 | $ 0.12 | $ 0.10 | $ 0.08 | $ 0.07 | $ 0.13 | $ 0.18 | $ 0.02 | $ 0.48 | $ 0.40 | $ (0.29) |
Diluted (in dollars per share) | $ 0.18 | $ 0.12 | $ 0.10 | $ 0.08 | $ 0.07 | $ 0.13 | $ 0.18 | $ 0.02 | $ 0.47 | $ 0.39 | $ (0.29) |