Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 01, 2018 | |
Document Information [Line Items] | ||
Entity Registrant Name | CTI INDUSTRIES CORP | |
Entity Central Index Key | 1,042,187 | |
Trading Symbol | ctib | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 3,525,227 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents (VIE $65,000 and $51,000, respectively) | $ 595,605 | $ 181,026 |
Accounts receivable, (less allowance for doubtful accounts of $102,000 and $114,000, respectively) | 11,980,251 | 11,235,834 |
Inventories, net (VIE $465,000 and $498,000, respectively) | 21,355,107 | 18,865,932 |
Prepaid expenses (VIE $174,000 and $80,000, respectively) | 777,268 | 887,885 |
Other current assets | 1,190,642 | 1,120,808 |
Total current assets | 35,898,873 | 32,291,485 |
Property, plant and equipment: | ||
Machinery and equipment | 23,545,121 | 23,439,781 |
Building | 3,367,082 | 3,367,082 |
Office furniture and equipment (VIE $281,000 and $268,000, respectively) | 2,613,300 | 2,591,159 |
Intellectual property | 752,044 | 752,044 |
Land | 250,000 | 250,000 |
Leasehold improvements | 415,610 | 402,963 |
Fixtures and equipment at customer locations | 518,450 | 518,450 |
Projects under construction | 123,271 | 121,241 |
Property, Plant and Equipment, Gross | 31,584,878 | 31,442,720 |
Less : accumulated depreciation and amortization (VIE $56,000 and $36,000, respectively) | (27,383,679) | (26,886,139) |
Total property, plant and equipment, net | 4,201,199 | 4,556,581 |
Other assets: | ||
Goodwill (VIE $440,000 and $440,000, respectively) | 1,473,176 | 1,473,176 |
Net deferred income tax asset | 1,373,000 | 1,102,467 |
Other assets | 583,931 | 560,329 |
Total other assets | 3,430,107 | 3,135,972 |
TOTAL ASSETS | 43,530,179 | 39,984,038 |
Current liabilities: | ||
Checks written in excess of bank balance (VIE $12,000 and $16,000, respectively) | 11,858 | 454,850 |
Trade payables (VIE $233,000 and $144,000, respectively) | 7,196,038 | 5,414,497 |
Line of credit (VIE $320,000 and $338,000, respectively) | 15,925,808 | 13,783,930 |
Notes payable - current portion | 5,341,792 | 942,533 |
Notes payable affiliates - current portion | 10,721 | 9,615 |
Capital Lease - current portion | 731 | 7,562 |
Accrued liabilities (VIE $141,000 and $92,000, respectively) | 2,435,558 | 2,047,893 |
Total current liabilities | 30,922,506 | 22,660,880 |
Long-term liabilities: | ||
Notes payable - affiliates | 213,214 | 212,545 |
Notes payable, net of current portion (VIE $68,000 and $83,000, respectively) | 137,554 | 4,951,581 |
Notes payable - officers, subordinated | 1,526,910 | 1,507,362 |
Deferred gain (non current) | 195,587 | 207,410 |
Deferred income tax liability | 84,000 | |
Total long-term debt, net of current portion | 2,157,265 | 6,878,898 |
Total long-term liabilities | 2,157,265 | 6,878,898 |
CTI Industries Corporation stockholders' equity: | ||
Preferred Stock -- no par value, 3,000,000 shares authorized, 0 shares issued and outstanding | ||
Common stock - no par value, 15,000,000 shares authorized, 3,573,885 shares issued and 3,530,227 shares outstanding | 13,898,494 | 13,898,494 |
Paid-in-capital | 2,333,236 | 2,271,261 |
Accumulated earnings | 238,873 | 720,223 |
Accumulated other comprehensive loss | (4,932,299) | (5,365,364) |
Less: Treasury stock, 43,658 shares | (160,784) | (160,784) |
Total CTI Industries Corporation stockholders' equity | 11,377,520 | 11,363,830 |
Noncontrolling interest | (927,112) | (919,570) |
Total Equity | 10,450,408 | 10,444,260 |
TOTAL LIABILITIES AND EQUITY | $ 43,530,179 | $ 39,984,038 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ / shares in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Cash and cash equivalents | $ 595,605 | $ 181,026 |
Allowance for doubtful accounts | 102,000 | 114,000 |
Inventories, net | 21,355,107 | 18,865,932 |
Prepaid expenses | 777,268 | 887,885 |
Office furniture and equipment | 2,613,300 | 2,591,159 |
Goodwill | 1,473,176 | 1,473,176 |
Net deferred income tax asset | 1,373,000 | 1,102,467 |
Checks written in excess of bank balance | 11,858 | 454,850 |
Trade payables | 7,196,038 | 5,414,497 |
Line of credit | 15,925,808 | 13,783,930 |
Accrued liabilities | $ 2,435,558 | $ 2,047,893 |
Preferred Stock, Par value (in dollars per share) | $ 0 | $ 0 |
Preferred Stock, shares authorized (in shares) | 3,000,000 | 3,000,000 |
Preferred Stock, shares issued (in shares) | 0 | 0 |
Preferred Stock, shares outstanding (in shares) | 0 | 0 |
Common stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 15,000,000 | 15,000,000 |
Common stock, shares issued (in shares) | 3,573,885 | 3,573,885 |
Common stock, shares outstanding (in shares) | 3,530,227 | 3,530,227 |
Treasury stock, shares (in shares) | 43,658 | 43,658 |
Variable Interest Entity, Primary Beneficiary, Aggregated Disclosure [Member] | ||
Cash and cash equivalents | $ 65,000 | $ 51,000 |
Inventories, net | 465,000 | 498,000 |
Prepaid expenses | 174,000 | 80,000 |
Office furniture and equipment | 281,000 | 268,000 |
Accumulated depreciation and amortization | 56,000 | 36,000 |
Goodwill | 440,000 | 440,000 |
Net deferred income tax asset | 62,000 | 52,000 |
Checks written in excess of bank balance | 12,000 | 16,000 |
Trade payables | 233,000 | 144,000 |
Line of credit | 320,000 | 338,000 |
Accrued liabilities | $ 141,000 | $ 92,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Net Sales | $ 13,979,177 | $ 15,359,637 |
Cost of Sales | 11,110,786 | 11,742,189 |
Gross profit | 2,868,391 | 3,617,448 |
Operating expenses: | ||
General and administrative | 1,884,046 | 1,901,256 |
Selling | 858,537 | 721,390 |
Advertising and marketing | 296,880 | 556,409 |
Gain on sale of assets | (24,414) | (69,300) |
Total operating expenses | 3,015,049 | 3,109,755 |
Income from operations | (146,658) | 507,693 |
Other (expense) income: | ||
Interest expense | (564,060) | (377,211) |
Interest income | (345) | 4,346 |
Change in fair value of warrants | 19,606 | |
Foreign currency loss | 31,028 | (30,525) |
Total other expense, net | (533,377) | (383,784) |
Net income before taxes | (680,035) | 123,909 |
Income tax expense | (209,484) | 75,637 |
Net income | (470,551) | 48,272 |
Less: Net (loss) income attributable to noncontrolling interest | (7,543) | (10,197) |
Net income attributable to CTI Industries Corporation | (463,008) | 58,469 |
Other Comprehensive Income (Loss) | ||
Foreign currency adjustment | 433,065 | 311,313 |
Comprehensive Income (Loss) | $ (29,943) | $ 369,782 |
Basic income per common share (in dollars per share) | $ (0.13) | $ 0.02 |
Diluted income per common share (in dollars per share) | $ (0.13) | $ 0.02 |
Weighted average number of shares and equivalent shares of common stock outstanding: | ||
Basic (in shares) | 3,530,227 | 3,591,947 |
Diluted (in shares) | 3,530,227 | 3,748,139 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net income | $ (470,551) | $ 48,272 |
Depreciation and amortization | 376,920 | 381,854 |
Amortization of debt discount | 61,975 | 47,025 |
Change in fair value of warrants | (19,606) | |
Amortization of deferred gain on sale/leaseback | (28,486) | (26,693) |
Provision for losses on accounts receivable | (17,781) | 1,827 |
Provision for losses on inventories | (35,503) | 20,099 |
Deferred income taxes | (133,982) | 8,124 |
Change in assets and liabilities: | ||
Accounts receivable | (465,865) | 2,660,360 |
Inventories | (1,995,477) | 815,593 |
Prepaid expenses and other assets | 109,567 | 13,083 |
Trade payables | 1,572,804 | (20,172) |
Accrued liabilities | 127,038 | (846,643) |
Net cash provided by operating activities | (899,341) | 3,083,123 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | 63,533 | (219,927) |
Net cash used in investing activities | 63,533 | (219,927) |
Cash flows from financing activities: | ||
Change in checks written in excess of bank balance | (442,992) | (629,530) |
Net change in revolving line of credit | 2,123,582 | (1,835,972) |
Repayment of long-term debt (related parties $0 and $2,000) | (432,942) | (390,788) |
Cash paid for deferred financing fees | (24,568) | |
Net cash used in financing activities | 1,223,080 | (2,856,290) |
Effect of exchange rate changes on cash | 27,307 | 12,759 |
Net decrease in cash and cash equivalents | 414,579 | 19,665 |
Cash and cash equivalents at beginning of period | 181,026 | 563,043 |
Cash and cash equivalents at end of period | 595,605 | 582,708 |
Supplemental disclosure of cash flow information: | ||
Cash payments for interest | 408,001 | 311,768 |
Supplemental Disclosure of non-cash investing and financing activity | ||
Property, Plant & Equipment acquisitions funded by liabilities | $ 25,387 | $ 63,474 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parentheticals) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Repayment of related party debt | $ 0 | $ 2,000 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Business Description and Basis of Presentation [Text Block] | Note 1 The accompanying condensed (a) consolidated balance sheet as of December 31, 2017, 10 8 X. not three March 31, 2018 not may December 31, 2018. 10 December 31, 2017. Principles of consolidation and nature of operations: The condensed consolidated financial statements include the accounts of CTI Industries Corporation and its wholly-owned subsidiaries, CTI Balloons Limited and CTI Supply, Inc., its majority-owned subsidiaries, Flexo Universal, S. de R.L. de C.V. and CTI Europe gmbH, as well as the accounts of Venture Leasing S. A. de R. L., Venture Leasing L.L.C and Clever Container Company, L.L.C. (the “Company”). The last three Variable Interest Entities (“VIE’s”): The determination of whether or not three Use of estimates: In preparing condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of revenue and expenses during the reporting period in the condensed consolidated financial statements and accompanying notes. Actual results may Earnings per share: Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during each period. Diluted earnings per share is computed by dividing the net income by the weighted average number of shares of common stock and equivalents (stock options and warrants), unless anti-dilutive, during each period. As of March 31, 2018 2017, 471,144 359,817, three March 31, 2018 2017 none 76,675, Significant Accounting Policies: The Company’s significant accounting policies are summarized in Note 2 December 31, 2017. no three March 31, 2018, 606, Revenue from Contracts with Customers. January 1, 2018, 606 606 not Net sales include revenues from sales of products and shipping and handling charges, net of estimates for product returns. Revenue is measured at the amount of consideration the Company expects to receive in exchange for the transferred products. Revenue is recognized at the point in time when we transfer the promised products to the customer and the customer obtains control over the products. The Company recognizes revenue for shipping and handling charges at the time the goods are shipped to the customer, and the costs of outbound freight are included in cost of sales, as we have elected the practical expedient included in ASC 606. The Company provides for product returns based on historical return rates. While we incur costs for sales commissions to our sales employees and outside agents, we recognize commission costs concurrent with the related revenue, as the amortization period is less than one 606. not not Recent Accounting Pronouncements: In February 2016, 2016 02, Leases ( 842 December 15, 2018, December 15, 2019, December 15, 2020. |
Note 2 - Debt
Note 2 - Debt | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Debt and Capital Leases Disclosures [Text Block] | Note 2 Until December 2017, $17 December 2017, $6 $18 December 2022. Available credit under the Revolving Credit facility is determined by eligible receivables and inventory at CTI Industries (U.S.) and Flexo Universal (Mexico). Certain terms of the PNC Agreements include: ● Restrictive Covenants ○ Borrow money; ○ Pay dividends and make distributions; ○ Make certain investments; ○ Use assets as security in other transactions; ○ Create liens; ○ Enter into affiliate transactions; ○ Merge or consolidate; or ○ Transfer and sell assets. ● Financial Covenants ○ We are required to maintain a "Leverage Ratio", which is defined as the ratio of (a) Funded Debt (other than the Shareholder Subordinated Loan) as of such date of determination to (b) EBITDA (as defined in the PNC Agreements) for the applicable period then ended. The highest values for this ratio allowed by the PNC Agreements are: Fiscal Quarter Ratio December 31, 2017 4.75 to 1.00 March 31, 2018 4.50 to 1.00 June 30, 2018 4.25 to 1.00 September 30, 2018 3.75 to 1.00 December 31, 2018 3.50 to 1.00 March 31, 2019 3.25 to 1.00 June 30, 2019 3.00 to 1.00 September 30, 2019 and thereafter 2.75 to 1.00 ○ We are required to maintain a "Fixed Charge Coverage Ratio", which is defined as the ratio of (a) EBITDA for such fiscal period, minus Unfinanced Capital Expenditures made during such period, minus distributions (including tax distributions) and dividends made during such period, minus cash taxes paid during such period to (b) all Debt Payments made during such period. This ratio must not 1.1 1.0 The credit agreement provides for interest at varying rates in excess of the prime rate, depending on the level of senior debt to EBITDA over time. We also entered into a swap agreement with PNC Bank to fix the interest for $3 3 December 2017 Failure to comply with these covenants might cause us to pay a higher rate of interest (by 2% December 31, 2017, not March 31, 2018. As a result, we have reclassified $4.4 On September 30, 2016, $530,000 $370,000 November 2016. December 2016 January 2017. Unrelated to the above, as of December 2017, $1,099,000, $400,000, December 2017 No three March 31, 2018, $27,000 |
Note 3 - Stock-based Compensati
Note 3 - Stock-based Compensation; Changes in Equity | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Stockholders' Equity Note Disclosure [Text Block] | Note 3 The Company has adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718 The Company has applied the Black-Scholes model to value stock-based awards and issued warrants related to notes payable. That model incorporates various assumptions in the valuation of stock-based awards relating to the risk-free rate of interest to be applied, the estimated dividend yield and expected volatility of our common stock. The risk-free rate of interest is the related U.S. Treasury yield curve for periods within the expected term of the option at the time of grant. The dividend yield on our common stock is estimated to be 0%, not 2018 2017. The Company’s net loss for the three March 31, 2018 2017 $62,000 $5,000, March 31, 2018, $302,000 $110,000 2018, $92,000 2019, $56,000 2020. On April 10, 2009, June 5, 2009, 2009 “2009 2009 510,000 March 31, 2018, 471,144 A summary of the Company’s stock option activity, which includes grants of restricted stock, non-qualified stock options, incentive stock options, warrants and related information, is as follows: Shares under Option Weighted Average Exercise Price Balance at December 31, 2017 476,144 $ 3.97 Granted - - Cancelled/Expired - - Exercised/Issued (5,000 ) - Outstanding at March 31, 2018 471,144 $ 4.01 Exercisable at March 31, 2018 103,463 $ 5.38 The instruments above have an aggregate intrinsic value of $37,000, March 31, 2018 March 31, 2018. |
Note 4 - Legal Proceedings
Note 4 - Legal Proceedings | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Contingencies Disclosure [Text Block] | Note 4 The Company may not In July, 2017, December 18, 2017, two not |
Note 5 - Other Comprehensive In
Note 5 - Other Comprehensive Income | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Comprehensive Income (Loss) Note [Text Block] | Note 5 In the three March 31, 2018, $433,000, The following table sets forth the accumulated balance of other comprehensive income and each component. Foreign Currency Items Total Accumulated Other Comprehensive Income Beginning balance as of January 1, 2018 $ (5,365,364 ) $ (5,365,364 ) Current period change, net of tax 433,065 433,065 Ending Balance as of March 31, 2018 (4,932,299 ) (4,932,299 ) |
Note 6 - Inventories, Net
Note 6 - Inventories, Net | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | Note 6 Inventories, Net March 31, 201 8 December 31, 2017 Raw materials $ 3,060,291 $ 2,632,415 Work in process 3,435,535 3,386,078 Finished goods 15,325,399 13,347,620 Allowance for excess quantities (466,118 ) (500,181 ) Total inventories $ 21,355,107 $ 18,865,932 |
Note 7 - Geographic Segment Dat
Note 7 - Geographic Segment Data | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | Note 7 The Company has determined that it operates primarily in one Net Sales to Outside Customers For the Three Months Ended Total Assets at March 31, March 31, December 31, 2018 2017 2018 2017 United States $ 9,738,000 $ 11,647,000 $ 29,094,000 $ 27,784,000 Europe 1,362,000 947,000 3,142,000 2,989,000 Mexico 2,186,000 2,023,000 9,844,000 8,288,000 United Kingdom 693,000 743,000 1,450,000 923,000 $ 13,979,000 $ 15,360,000 $ 43,530,000 $ 39,984,000 |
Note 8 - Concentration of Credi
Note 8 - Concentration of Credit Risk | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Concentration Risk Disclosure [Text Block] | Note 8 Concentration of credit risk with respect to trade accounts receivable is generally limited due to the large number of entities comprising the Company's customer base. The Company performs ongoing credit evaluations and provides an allowance for potential credit losses against the portion of accounts receivable which is estimated to be uncollectible. Such losses have historically been within management's expectations. During the three March 31, 2018 2017, two 10% three March 31, 2018 2017 Three Months Ended Three Months Ended March 31, 2018 March 31, 2017 Customer Net Sales % of Net Sales Net Sales % of Net Sales Customer A $ 4,450,000 31.8% $ 4,427,000 28.8% Customer B $ 2,471,000 17.7% $ 2,609,000 17.0% As of March 31, 2018, $3,643,000 33.4%, $2,657,000 24.3%, March 31, 2017 $3,301,000 27.7%, $2,657,000 22.3% |
Note 9 - Related Party Transact
Note 9 - Related Party Transactions | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | Note 9 - Related Party Transactions Stephen M. Merrick, Chief Executive Officer of the Company, is of counsel to the law firm of Vanasco Genelly and Miller PC which provides legal services to the Company. Legal fees paid by the Company to this firm for the three March 31, 2018 2017, $72,000 $26,000. John H. Schwan, through an investment entity, and Stephen M. Merrick, Chief Executive Officer of the Company, also through an investment entity own, in aggregate, a 50% three March 31, 2018 2017, $237,000 $204,000, March 31, 2018 2017, $1,102,000 $711,000, 28.5% |
Note 10 - Derivative Instrument
Note 10 - Derivative Instruments; Fair Value | 3 Months Ended |
Mar. 31, 2018 | |
Notes to Financial Statements | |
Derivatives and Fair Value [Text Block] | Note 10 - Derivative Instruments; Fair Value The Company accounts for derivative instruments in accordance with U.S. GAAP, which requires that all derivative instruments be recognized on the balance sheet at fair value. We may one one March 31, 2018 December 31, 2017, one no March 31, 2017. not no December 31, 2017. The interest rate swap we entered into December 14, 2017 three December 14, 2020) $3 2.25% 1.47% March 31, 2018 December 31, 2017. |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of consolidation and nature of operations: The condensed consolidated financial statements include the accounts of CTI Industries Corporation and its wholly-owned subsidiaries, CTI Balloons Limited and CTI Supply, Inc., its majority-owned subsidiaries, Flexo Universal, S. de R.L. de C.V. and CTI Europe gmbH, as well as the accounts of Venture Leasing S. A. de R. L., Venture Leasing L.L.C and Clever Container Company, L.L.C. (the “Company”). The last three |
Consolidation, Variable Interest Entity, Policy [Policy Text Block] | Variable Interest Entities (“VIE’s”): The determination of whether or not three |
Use of Estimates, Policy [Policy Text Block] | Use of estimates: In preparing condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amount of revenue and expenses during the reporting period in the condensed consolidated financial statements and accompanying notes. Actual results may |
Earnings Per Share, Policy [Policy Text Block] | Earnings per share: Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during each period. Diluted earnings per share is computed by dividing the net income by the weighted average number of shares of common stock and equivalents (stock options and warrants), unless anti-dilutive, during each period. As of March 31, 2018 2017, 471,144 359,817, three March 31, 2018 2017 none 76,675, |
New Accounting Pronouncements, Policy [Policy Text Block] | Significant Accounting Policies: The Company’s significant accounting policies are summarized in Note 2 December 31, 2017. no three March 31, 2018, 606, Revenue from Contracts with Customers. January 1, 2018, 606 606 not Net sales include revenues from sales of products and shipping and handling charges, net of estimates for product returns. Revenue is measured at the amount of consideration the Company expects to receive in exchange for the transferred products. Revenue is recognized at the point in time when we transfer the promised products to the customer and the customer obtains control over the products. The Company recognizes revenue for shipping and handling charges at the time the goods are shipped to the customer, and the costs of outbound freight are included in cost of sales, as we have elected the practical expedient included in ASC 606. The Company provides for product returns based on historical return rates. While we incur costs for sales commissions to our sales employees and outside agents, we recognize commission costs concurrent with the related revenue, as the amortization period is less than one 606. not not Recent Accounting Pronouncements: In February 2016, 2016 02, Leases ( 842 December 15, 2018, December 15, 2019, December 15, 2020. |
Note 2 - Debt (Tables)
Note 2 - Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Schedule of Leverage Ratios [Table Text Block] | Fiscal Quarter Ratio December 31, 2017 4.75 to 1.00 March 31, 2018 4.50 to 1.00 June 30, 2018 4.25 to 1.00 September 30, 2018 3.75 to 1.00 December 31, 2018 3.50 to 1.00 March 31, 2019 3.25 to 1.00 June 30, 2019 3.00 to 1.00 September 30, 2019 and thereafter 2.75 to 1.00 |
Note 3 - Stock-based Compensa19
Note 3 - Stock-based Compensation; Changes in Equity (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Share-based Compensation, Activity [Table Text Block] | Shares under Option Weighted Average Exercise Price Balance at December 31, 2017 476,144 $ 3.97 Granted - - Cancelled/Expired - - Exercised/Issued (5,000 ) - Outstanding at March 31, 2018 471,144 $ 4.01 Exercisable at March 31, 2018 103,463 $ 5.38 |
Note 5 - Other Comprehensive 20
Note 5 - Other Comprehensive Income (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Foreign Currency Items Total Accumulated Other Comprehensive Income Beginning balance as of January 1, 2018 $ (5,365,364 ) $ (5,365,364 ) Current period change, net of tax 433,065 433,065 Ending Balance as of March 31, 2018 (4,932,299 ) (4,932,299 ) |
Note 6 - Inventories, Net (Tabl
Note 6 - Inventories, Net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | March 31, 201 8 December 31, 2017 Raw materials $ 3,060,291 $ 2,632,415 Work in process 3,435,535 3,386,078 Finished goods 15,325,399 13,347,620 Allowance for excess quantities (466,118 ) (500,181 ) Total inventories $ 21,355,107 $ 18,865,932 |
Note 7 - Geographic Segment D22
Note 7 - Geographic Segment Data (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Net Sales to Outside Customers For the Three Months Ended Total Assets at March 31, March 31, December 31, 2018 2017 2018 2017 United States $ 9,738,000 $ 11,647,000 $ 29,094,000 $ 27,784,000 Europe 1,362,000 947,000 3,142,000 2,989,000 Mexico 2,186,000 2,023,000 9,844,000 8,288,000 United Kingdom 693,000 743,000 1,450,000 923,000 $ 13,979,000 $ 15,360,000 $ 43,530,000 $ 39,984,000 |
Note 8 - Concentration of Cre23
Note 8 - Concentration of Credit Risk (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Notes Tables | |
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | Three Months Ended Three Months Ended March 31, 2018 March 31, 2017 Customer Net Sales % of Net Sales Net Sales % of Net Sales Customer A $ 4,450,000 31.8% $ 4,427,000 28.8% Customer B $ 2,471,000 17.7% $ 2,609,000 17.0% |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation (Details Textual) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 76,675 |
Employee Stock Options and Warrants [Member] | ||
Common Stock, Capital Shares Reserved for Future Issuance | 471,144 | 359,817 |
Note 2 - Debt (Details Textual)
Note 2 - Debt (Details Textual) | Dec. 14, 2017USD ($) | Sep. 30, 2016USD ($) | Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2017USD ($) | Nov. 30, 2017USD ($) |
Potential Percent Increase in Interest Rates Contingent on Covenant Compliance | 2.00% | |||||
Reclassification of Noncurrent Debt to Current Debt | $ 4,400,000 | |||||
Interest Expense, Total | 564,060 | $ 377,211 | ||||
PNC [Member] | Interest Rate Swap [Member] | Designated as Hedging Instrument [Member] | ||||||
Derivative Liability, Notional Amount | $ 3,000,000 | |||||
Derivative, Term of Contract | 3 years | |||||
Maximum [Member] | ||||||
Fixed Charge Coverage Ratio | 1.1 | |||||
Promissory Note [Member] | John H Schwan [Member] | ||||||
Proceeds from Related Party Debt | $ 530,000 | |||||
Due to Related Parties, Total | $ 1,099,000 | |||||
Interest Payable | 400,000 | |||||
Interest Expense, Total | $ 27,000 | |||||
BMO [Member] | ||||||
Long-term Debt, Total | $ 17,000,000 | |||||
PNC [Member] | PNC Agreements [Member] | Revolving Credit Facility [Member] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | 18,000,000 | |||||
PNC [Member] | PNC Agreements [Member] | Term Loan [Member] | ||||||
Long-term Debt, Total | $ 6,000,000 |
Note 2 - Debt - Leverage Ratios
Note 2 - Debt - Leverage Ratios (Details) | 3 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Leverage ratio | 4.5 | 4.75 | ||||||
Scenario, Forecast [Member] | ||||||||
Leverage ratio | 2.75 | 3 | 3.25 | 3.5 | 3.75 | 4.25 |
Note 3 - Stock-based Compensa27
Note 3 - Stock-based Compensation; Changes in Equity (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | Apr. 10, 2009 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate | 0.00% | |||
Dividends, Common Stock, Cash | $ 0 | $ 0 | ||
Allocated Share-based Compensation Expense, Total | 62,000 | $ 5,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Total | 302,000 | |||
Expected Recognized Compensation Expenses, Remainder of the Fiscal Year | 110,000 | |||
Expected Recognized Compensation Expenses in Year Two | 92,000 | |||
Expected Recognized Compensation Expenses in Year Three | $ 56,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 471,144 | 476,144 | ||
Stock Incentive Plan 2009 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 510,000 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance | 471,144 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 37,000 |
Note 3 - Stock-based Compensa28
Note 3 - Stock-based Compensation; Changes in Equity - Option Activity (Details) | 3 Months Ended |
Mar. 31, 2018$ / sharesshares | |
Outstanding, beginning of period (in shares) | shares | 476,144 |
Outstanding, beginning of period (in dollars per share) | $ / shares | $ 3.97 |
Granted (in shares) | shares | |
Granted (in dollars per share) | $ / shares | |
Cancelled/Expired (in shares) | shares | |
Cancelled/Expired (in dollars per share) | $ / shares | |
Exercised/Issued (in shares) | shares | (5,000) |
Exercised/Issued (in dollars per share) | $ / shares | |
Outstanding at the end of period (in shares) | shares | 471,144 |
Outstanding at the end of period (in dollars per share) | $ / shares | $ 4.01 |
Exercisable at the end of period (in shares) | shares | 103,463 |
Exercisable at the end of period (in dollars per share) | $ / shares | $ 5.38 |
Note 5 - Other Comprehensive 29
Note 5 - Other Comprehensive Income (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax, Total | $ 433,065 | $ 311,313 |
Note 5 - Other Comprehensive 30
Note 5 - Other Comprehensive Income - Accumulated Other Comprehensive Loss Balances (Details) | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Balance | $ 10,444,260 |
Balance | 10,450,408 |
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |
Balance | (5,365,364) |
Accumulated Other Comprehensive Loss, Current period change | 433,065 |
Balance | (4,932,299) |
AOCI Attributable to Parent [Member] | |
Balance | (5,365,364) |
Accumulated Other Comprehensive Loss, Current period change | 433,065 |
Balance | $ (4,932,299) |
Note 6 - Inventories, Net - Inv
Note 6 - Inventories, Net - Inventories (Details) - USD ($) | Mar. 31, 2018 | Dec. 31, 2017 |
Raw materials | $ 3,060,291 | $ 2,632,415 |
Work in process | 3,435,535 | 3,386,078 |
Finished goods | 15,325,399 | 13,347,620 |
Allowance for excess quantities | (466,118) | (500,181) |
Total inventories | $ 21,355,107 | $ 18,865,932 |
Note 7 - Geographic Segment D32
Note 7 - Geographic Segment Data (Details Textual) | 3 Months Ended |
Mar. 31, 2018 | |
Number of Operating Segments | 1 |
Note 7 - Geographic Segment D33
Note 7 - Geographic Segment Data - Financial Information by Geographic Area (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Sales to outside customers | $ 13,979,177 | $ 15,359,637 | |
Total Assets | 43,530,179 | 39,984,000 | $ 39,984,038 |
UNITED STATES | |||
Sales to outside customers | 9,738,000 | 11,647,000 | |
Total Assets | 29,094,000 | 27,784,000 | |
Europe [Member] | |||
Sales to outside customers | 1,362,000 | 947,000 | |
Total Assets | 3,142,000 | 2,989,000 | |
MEXICO | |||
Sales to outside customers | 2,186,000 | 2,023,000 | |
Total Assets | 9,844,000 | 8,288,000 | |
UNITED KINGDOM | |||
Sales to outside customers | 693,000 | 743,000 | |
Total Assets | $ 1,450,000 | $ 923,000 |
Note 8 - Concentration of Cre34
Note 8 - Concentration of Credit Risk (Details Textual) | 3 Months Ended | |
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | |
Customer One [Member] | ||
Accounts Receivable, Gross | $ 3,643,000 | $ 3,301,000 |
Customer Two [Member] | ||
Accounts Receivable, Gross | $ 2,657,000 | $ 2,657,000 |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | ||
Number of Major Customers | 2 | 2 |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Customer One [Member] | ||
Concentration Risk, Percentage | 31.80% | 28.80% |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Customer Two [Member] | ||
Concentration Risk, Percentage | 17.70% | 17.00% |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer One [Member] | ||
Concentration Risk, Percentage | 33.40% | 27.70% |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer Two [Member] | ||
Concentration Risk, Percentage | 24.30% | 22.30% |
Note 8 - Concentration of Cre35
Note 8 - Concentration of Credit Risk (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Net Sales | $ 13,979,177 | $ 15,359,637 |
Customer One [Member] | ||
Net Sales | $ 4,450,000 | $ 4,427,000 |
Customer One [Member] | Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | ||
Percent of net sales | 31.80% | 28.80% |
Customer Two [Member] | ||
Net Sales | $ 2,471,000 | $ 2,609,000 |
Customer Two [Member] | Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | ||
Percent of net sales | 17.70% | 17.00% |
Note 9 - Related Party Transa36
Note 9 - Related Party Transactions (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Legal Fees | $ 72,000 | $ 26,000 |
Clever Container [Member] | ||
Noncontrolling Interest, Ownership Percentage by Parent | 28.50% | |
Clever Container [Member] | ||
Revenue from Related Parties | $ 237,000 | 204,000 |
Accounts Receivable, Related Parties | $ 1,102,000 | $ 711,000 |
Note 10 - Derivative Instrume37
Note 10 - Derivative Instruments; Fair Value (Details Textual) - PNC [Member] - Interest Rate Swap [Member] - Designated as Hedging Instrument [Member] | Dec. 14, 2017USD ($) |
Derivative Liability, Notional Amount | $ 3,000,000 |
Derivative, Fixed Interest Rate | 2.25% |
Derivative, Variable Interest Rate | 1.47% |