Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 05, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'INNOTRAC CORP | ' |
Entity Central Index Key | '0001051114 | ' |
Trading Symbol | 'inoc | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 13,245,440 |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $3,450 | $4,005 |
Accounts receivable (net of allowance for doubtful accounts of $134 at September 30, 2013 and $136 at December 31, 2012) | 20,084 | 23,216 |
Inventories, net | 704 | 740 |
Deferred income taxes | 639 | ' |
Prepaid expenses and other | 1,277 | 1,107 |
Total current assets | 26,154 | 29,068 |
Property and equipment: | ' | ' |
Computers, machinery and equipment | 48,495 | 42,877 |
Furniture, fixtures and leasehold improvements | 10,405 | 10,055 |
Total property and equipment, gross | 58,900 | 52,932 |
Less accumulated depreciation and amortization | -41,990 | -39,089 |
Total property and equipment, net | 16,910 | 13,843 |
Deferred income taxes | 16,569 | ' |
Other assets, net | 1,459 | 1,281 |
Total assets | 61,092 | 44,192 |
Current liabilities: | ' | ' |
Accounts payable | 7,957 | 10,409 |
Line of credit | ' | ' |
Accrued salaries | 1,828 | 2,854 |
Equipment lease payable | 652 | 421 |
Accrued expenses and other | 3,742 | 3,088 |
Equipment loan (See Note 2) | ' | 1,620 |
Total current liabilities | 14,179 | 18,392 |
Noncurrent liabilities: | ' | ' |
Deferred compensation | 969 | 837 |
Equipment lease payable | 1,188 | 544 |
Other noncurrent liabilities | 697 | 963 |
Total noncurrent liabilities | 2,854 | 2,344 |
Commitments and contingencies (see Note 5) | ' | ' |
Shareholders' equity: | ' | ' |
Preferred stock: 10,000,000 shares authorized, $0.10 par value, no shares issued or outstanding | ' | ' |
Common stock: 50,000,000 shares authorized, $0.10 par value, 13,245,440 shares issued and outstanding at September 30, 2013 13,155,440 shares issued and outstanding at December 31, 2012 | 1,325 | 1,316 |
Additional paid-in capital | 66,930 | 66,784 |
Accumulated other comprehensive loss | -2 | -2 |
Accumulated deficit | -24,207 | -44,656 |
Total Innotrac shareholders' equity | 44,046 | 23,442 |
Noncontrolling interest | 13 | 14 |
Total equity | 44,059 | 23,456 |
Total liabilities and equity | $61,092 | $44,192 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Accounts receivable allowance for doubtful accounts (in dollars) | $134 | $136 |
Preferred stock, par value (in dollars per share) | $0.10 | $0.10 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | ' | ' |
Preferred stock, shares outstanding | ' | ' |
Common stock, par value (in dollars per share) | $0.10 | $0.10 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 13,245,440 | 13,155,440 |
Common stock, shares outstanding | 13,245,440 | 13,155,440 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Service revenues | $26,410 | $22,088 | $77,875 | $63,857 |
Freight revenues | 3,345 | 3,606 | 10,471 | 8,953 |
Total revenues | 29,755 | 25,694 | 88,346 | 72,810 |
Cost of service revenues | 13,391 | 10,368 | 38,839 | 30,326 |
Freight expense | 3,240 | 3,463 | 10,129 | 8,639 |
Selling, general and administrative expenses | 10,816 | 9,674 | 32,988 | 28,931 |
Depreciation and amortization | 996 | 995 | 2,901 | 2,711 |
Total operating expenses | 28,443 | 24,500 | 84,857 | 70,607 |
Operating income | 1,312 | 1,194 | 3,489 | 2,203 |
Other expense (income): | ' | ' | ' | ' |
Interest expense | 41 | 90 | 196 | 212 |
Other (income) expense | -1 | -2 | -1 | ' |
Total other expense | 40 | 88 | 195 | 212 |
Income before income taxes | 1,272 | 1,106 | 3,294 | 1,991 |
Income tax benefit | -17,184 | ' | -17,154 | ' |
Net income | 18,456 | 1,106 | 20,448 | 1,991 |
Net income attributable to noncontrolling interest | 1 | -1 | 1 | ' |
Net income attributable to Innotrac | $18,457 | $1,105 | $20,449 | $1,991 |
Earnings per share: | ' | ' | ' | ' |
Basic (in dollars per share) | $1.39 | $0.08 | $1.55 | $0.15 |
Diluted (in dollars per share) | $1.39 | $0.08 | $1.55 | $0.15 |
Weighted average shares outstanding: | ' | ' | ' | ' |
Basic (in shares) | 13,245 | 13,058 | 13,199 | 13,033 |
Diluted (in shares) | 13,267 | 13,058 | 13,215 | 13,033 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $20,448 | $1,991 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 2,901 | 2,711 |
Provision for bad debts | 3 | 18 |
Deferred income taxes | -17,208 | ' |
Stock compensation expense-restricted stock | 155 | 124 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable, gross | 3,129 | -1,611 |
Inventory | 36 | 160 |
Prepaid expenses and other | -126 | -230 |
Other long-term assets | 52 | -69 |
Accounts payable | -3,929 | -1,661 |
Accrued expenses, accrued salaries and other | -372 | 396 |
Other long-term liabilities | -266 | -91 |
Net cash provided by operating activities | 4,823 | 1,738 |
Cash flows from investing activities: | ' | ' |
Capital expenditures | -3,291 | -4,703 |
Proceeds from disposition of assets | ' | 1 |
Net change in noncurrent assets and liabilities | -10 | -9 |
Net cash used in investing activities | -3,301 | -4,711 |
Cash flows from financing activities: | ' | ' |
Borrowings on equipment loan | ' | 1,800 |
Payments on equipment loan | -1,620 | -90 |
Capital lease payments | -326 | -321 |
Loan commitment fees | -131 | -37 |
Net cash (used in) provided by financing activities | -2,077 | 1,352 |
Net decrease in cash and cash equivalents | -555 | -1,621 |
Cash and cash equivalents, beginning of period | 4,005 | 3,283 |
Cash and cash equivalents, end of period | 3,450 | 1,662 |
Supplemental cash flow disclosures: | ' | ' |
Cash paid for interest | 151 | 148 |
Non-cash investing and financing activities: | ' | ' |
Capital lease for warehouse and computer equipment | 1,201 | 862 |
Capital expenditures in accounts payable | $1,477 | $287 |
THE_COMPANY_AND_SIGNIFICANT_AC
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||||||
1. THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||||||
Innotrac Corporation (“Innotrac” or the “Company”), founded in 1984 and based near Atlanta, Georgia, is a best-in-class commerce provider integrating digital technology, fulfillment, contact center and business intelligence solutions to support global brands. Innotrac’s fulfillment, order management and contact center solutions are integrated with all major web platforms, and are integrated with partner technologies. The Company employs sophisticated order processing and warehouse management technology and operates eight fulfillment centers and one call center spanning all time zones across the continental United States. | |||||||||||||||||
The accounting policies followed for quarterly financial reporting are the same as those disclosed in the Notes to Financial Statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended December 31, 2012. Certain of the Company’s more significant accounting policies are as follows: | |||||||||||||||||
Principles of Consolidation. The financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company and its majority owned subsidiary. On April 11, 2011 the Company completed the formation of Innotrac Europe GmbH (“Innotrac Europe”), a joint venture between Innotrac and PVS Fulfillment-Service GmbH (“PVS”) in Neckarsulm, Germany. Innotrac has a 50.1% ownership stake in the joint venture. All significant intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||||||
Accounting Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||||||||
Accounting for Income Taxes. Innotrac utilizes the liability method of accounting for income taxes in accordance with ASC topic No. 740 – Income Taxes. Under the liability method, deferred taxes are determined based on the difference between the financial and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. A valuation allowance was recorded against the net deferred tax asset as of December 31, 2012. At September 30, 2013, the Company reversed the majority of the valuation allowance in the amount of $17.2 million, leaving a balance of $1.9 million (see Note 4). | |||||||||||||||||
Revenue Recognition. Innotrac derives its revenue primarily from three sources: (1) fulfillment operations (2) the delivery of call center services integrated with our fulfillment operations and (3) delivering technology solutions and integration services to its clients. Innotrac’s fulfillment services operations record revenue at the conclusion of the material selection, packaging and upon completion of the shipping process. The shipping process is considered complete after transfer to an independent freight carrier and receipt of a bill of lading or shipping manifest from that carrier. Innotrac’s call center service revenue is recognized according to written pricing agreements based on the number of calls, minutes or hourly rates when those calls and time rated services occur. All other revenues are recognized as services are rendered. As required by the consensus reached in ASC topic No. 605 – Revenue Recognition, 1) revenues have been recorded net of the cost of the goods for all fee-for-service clients and 2) the Company records reimbursements received from customers for out-of pocket expenses, primarily freight and postage fees, as revenue and the associated expense as cost of revenue. The Company purchases product for two clients from vendors under agreements that require our clients to buy the product back from us at original cost when product is shipped to our client’s end consumer or after a period of time if the product has not been shipped from our fulfillment centers. The value of these products is paid to Innotrac at the same value paid and no service fees are generated on the product. The value of the purchase is netted against the reimbursement from our customer with a resulting zero value in our reported revenue and costs of revenue. | |||||||||||||||||
Fair Value Measurements. The Company accounts for fair value in accordance with ASC topic No. 820- Fair Value Measurements and Disclosures for all financial and non-financial assets and liabilities accounted for at fair value on a recurring basis. ASC topic No. 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States of America, and expands disclosures about fair value measurements. | |||||||||||||||||
The Company determined the fair values of certain financial instruments based on the fair value hierarchy established in ASC topic No. 820. ASC topic No. 820 requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value. | |||||||||||||||||
Level 1: Quoted market prices in active markets for identical assets or liabilities. | |||||||||||||||||
Level 2: Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||||||
Level 3: Unobservable inputs developed using the Company’s estimates and assumptions which reflect those that the market participants would use. | |||||||||||||||||
ASC topic No. 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. | |||||||||||||||||
The carrying value of our cash, accounts receivable and accounts payable approximate their fair value, principally due to the short-term maturities of these instruments. Our debt instruments approximates fair value since our debt instrument consists of a revolving credit line, which under certain conditions can mature within one year of September 30, 2013, and because of its short term nature. The interest rate is equal to the market rate for such instruments of similar duration and credit quality. | |||||||||||||||||
The Company’s assets measured at fair market value on a recurring basis are as follows: | |||||||||||||||||
As of September 30, 2013 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
Total | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
As of December 31, 2012 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
Total | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
-1 | This is an executive deferred compensation plan for certain employees, as designated by the Company’s Board of Directors. The Company invests contributions to this plan in employee-directed marketable equity securities which are recorded in other assets on the accompanying consolidated balance sheets at quoted market prices. The contributions are fully invested in five different mutual funds having various growth, industry and geographic characteristics. | ||||||||||||||||
There were no significant transfers into and out of any level of the fair value hierarchy for assets measured at fair value for the three and nine months ended September 30, 2013 or the year ended December 31, 2012. | |||||||||||||||||
All transfers, if any, are recognized by the Company at the end of each reporting period. | |||||||||||||||||
Transfers between Levels 1 and 2 generally relate to whether a market becomes active or inactive. Transfers between Levels 2 and 3 generally relate to whether significant relevant observable inputs are available for the fair value measurement in their entirety. | |||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||
In February 2013, the FASB issued ASU 2013-02 to Topic 220 – Reporting of amounts Reclassified Out of Accumulated Other Comprehensive Income. The amendments to the Codification in this ASU require additional disclosure on the face of financial statements or in the notes to the financial statements, depending on materiality, for amounts reclassified out of accumulated other comprehensive income by component. This ASU supersedes certain presentation requirements of ASU No. 2011-05 and ASU 2011-12 to Topic 220. This amendment to this ASU was effective for reporting periods beginning after December 15, 2012 with early adoption permitted. The Company adopted these provisions in the fourth quarter of 2012. Adoption of this provisions did not have a material impact on the Company’s consolidated financial statements since the Company has only immaterial other comprehensive income amounts. | |||||||||||||||||
In July 2013, the FASB issued ASU 2013-11 to Topic 740 – Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The amendment to the Codification in this ASU requires an unrecognized tax benefit to be presented as a decrease in a deferred tax asset where a net operating loss, a similar tax loss, or a tax credit carryforward exists and certain criteria are met. This ASU is effective prospectively for annual and interim reporting periods beginning after December 15, 2013. The Company is currently evaluating the potential impact of the adoption of this guidance on its consolidated financial statements. |
FINANCING_OBLIGATIONS
FINANCING OBLIGATIONS | 9 Months Ended |
Sep. 30, 2013 | |
Financing Obligations [Abstract] | ' |
FINANCING OBLIGATIONS | ' |
2. FINANCING OBLIGATIONS | |
The Company has a revolving credit facility (the “Credit Facility”) with SunTrust Bank (the “Bank”) which has a maximum borrowing limit of $25 million, which includes a $5 million stand-by letter of credit subfacility. The Credit Facility is used to fund the Company’s capital expenditures, potential acquisitions and working capital. The Company entered into the Credit Facility on June 13, 2013, replacing the previous bank facilities held with Wells Fargo, N.A. The Credit Facility has a maturity date of June 14, 2016 and the Bank maintains a first priority security interest in substantially all of the Company’s assets. | |
Interest on borrowings pursuant to the Credit Facility is payable monthly at the LIBOR Rate plus between 1.50% and 2.50% per annum, depending on the Company’s Senior Leverage Ratio (as defined in the Credit Facility). In an event of default, the Bank has the right to charge interest at the otherwise applicable rate plus 2.00% per annum. The facility carries a quarterly commitment fee calculated based upon average daily undrawn availability under the Credit Facility multiplied by an applicable percentage ranging between 0.25% and 0.50% per annum depending on the Company’s Senior Leverage Ratio (as defined in the Credit Facility), and letter of credit fees are payable for issued and outstanding letters of credit as specified in the Credit Facility. | |
The Credit Facility contains financial, affirmative and negative covenants by the Company as are usual and customary for financings of this kind, which can result in the acceleration of the maturity of amounts borrowed under the Credit Facility, including, a restriction on cash dividends, a change in ownership control covenant and financial covenants. The Credit Facility includes financial covenants that require the Company to maintain a minimum Fixed Charge Coverage Ratio of 1.05 to 1.00, limit capital expenditures, maintain a Minimum Adjusted EBITDA of at least $5,000,000, and a Maximum Senior Leverage Ratio of either 2.5 to 1.00 or 3.0 to 1.00, based on the Company’s trailing EBITDA. The provisions of the Credit Facility allow the Bank to declare any outstanding borrowings to be immediately due and payable as a result of noncompliance with any of the covenants. As of September 30, 2013, the Company was in compliance with all terms of the Credit Facility. | |
For the three months ended September 30, 2013, interest expense was $2,000 on bank facilities at a weighted average interest rate of 2.69%. There were no borrowings on the facility at September 30, 2013, but the applicable rate of interest on any borrowing at September 30, 2013 would have been 1.68%. For the three months ended September 30, 2012, interest expense was less than $1,000 on the bank facility at a weighted average interest rate of 3.27%. The Company also incurred unused bank facility fees of approximately $15,000 and $23,000 for the three months ended September 30, 2013 and 2012, respectively, which unused bank facility fees are included in the total interest expense of $41,000 and $90,000 for the three months ended September 30, 2013 and 2012, respectively. | |
For the nine months ended September 30, 2013, interest expense was $3,000 on the bank facility at a weighted average interest rate of 2.09%. For the nine months ended September 30, 2012, interest expense was $7,000 on the bank facility at a weighted average interest rate of 3.28%. The Company also incurred unused bank facility fees of approximately $60,000 and $75,000 for the nine months ended September 30, 2013 and 2012, respectively, which unused bank facility fees are included in the total interest expense of $196,000 and $212,000 for the nine months ended September 30, 2013 and 2012, respectively. | |
The Company has entered into capital leases for the purchase of forklift trucks, conveyors, racking, computer technology equipment and computer software. These capital leases have a term of 3 - 5 years. The amortization of these assets is included in depreciation expense. The total amount of remaining lease payments to be paid on capital leases, including interest and taxes, was $2.0 million and $1.1 million at September 30, 2013 and December 31, 2012, respectively. For the three months ended September 30, 2013, the Company repaid $106,000 of principal outstanding and $14,000 of interest expense related to capital leases. For the three months ended September 30, 2012, the Company repaid $105,000 of principal outstanding and $25,000 of interest expense related to capital leases. For the nine months ended September 30, 2013, the Company repaid $326,000 of principal outstanding and $48,000 of interest expense related to capital leases. For the nine months ended September 30, 2012, the Company repaid $321,000 of principal outstanding and $52,000 of interest expense related to capital leases. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
EARNINGS PER SHARE | ' | ||||||||||||||||
3. EARNINGS PER SHARE | |||||||||||||||||
The following table shows the shares (in thousands) used in computing diluted earnings per share (“EPS”) in accordance with ASC topic No. 260 – Earnings per Share: | |||||||||||||||||
Three Months | Nine Months | ||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Diluted earnings per share: | |||||||||||||||||
Weighted average shares outstanding | 13,245 | 13,058 | 13,199 | 13,033 | |||||||||||||
Employee and director stock options | 22 | - | 16 | - | |||||||||||||
Weighted average shares assuming dilution | 13,267 | 13,058 | 13,215 | 13,033 | |||||||||||||
Options outstanding to purchase 286,000 shares of the Company’s common stock for the three and nine months ended September 30, 2013 and 351,000 shares for the three and nine months ended September 30, 2012 were not included in the computation of diluted EPS because their effect was anti-dilutive. | |||||||||||||||||
On January 1, 2009 the Company adopted an update to ASC topic No. 260, which requires the inclusion of all unvested stock awards which contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, in the number of shares outstanding in our basic and diluted EPS calculations. | |||||||||||||||||
As a result, 910,637 of restricted shares are included in our calculation of basic and diluted EPS for the three and nine months ended September 30, 2013 and 820,637 for the three and nine months ended September 30, 2012. These restricted shares were issued under the Innotrac Corporation 2000 Stock Option and Incentive Award Plan and the Innotrac Corporation 2010 Stock Award Plan. Both plans provide for immediate voting rights, forfeiture of unvested shares if a grantee’s employment or service with the Company ends for any reason (other than a change in control, as defined in the plan), and vesting of shares upon the earlier of a change in control or on specific vesting dates. The vesting period for all restricted shares issued prior to June 2011 is 25% on each of the 7th, 8th, 9th and 10th anniversary of the issuance date, or earlier upon a change in control. Vesting for restricted shares issued to employees beginning in June 2011 follow the same schedule of 25% on each of the 7th, 8th, 9th and 10th anniversary of the issuance date, or earlier upon a change in control. The vesting period for restricted shares issued to non-employee Directors of the Company beginning in June 2011 follows the same schedule of 25% vesting on each of the 7th, 8th, 9th, and 10th anniversary (or earlier upon a change in control), unless the Director’s service with the Company terminates other than for cause prior to all shares vesting, in which case shares vest one third on the date of issuance and one third on each of the 1st and 2nd anniversary of the issuance date. |
INCOME_TAXES
INCOME TAXES | 9 Months Ended | ||
Sep. 30, 2013 | |||
Income Tax Disclosure [Abstract] | ' | ||
INCOME TAXES | ' | ||
4. INCOME TAXES | |||
Innotrac utilizes the liability method of accounting for income taxes in accordance with ASC topic No. 740 – Income Taxes. Under the liability method, deferred taxes are determined based on the difference between the financial and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. | |||
Management assesses the ability to realize the benefit of deferred tax assets and records a valuation allowance if it is more likely than not that all or a portion of the deferred tax assets will not be realized. We consider the probability of future taxable income and our historical profitability, among other factors, in assessing the amount of the valuation allowance. We recorded a valuation allowance against the Company’s net deferred tax assets as of December 31, 2012, 2011 and 2010 because operating losses at the time created uncertainty about the realization of deferred tax assets in future years. During the period ended September 30, 2013, we released $17.2 million of our valuation allowance related to our deferred tax assets. These deferred tax assets relate primarily to net operating loss carryforwards, which we determined it is more likely than not we will be able to utilize due to the expected generation of sufficient taxable income in the future. All of the $17.2 million valuation allowance release was recorded as an income tax benefit in the Condensed Consolidated Statements of Operations. As a result, the Company’s effective tax rate for the three and nine months ended September 30, 2013 was ($1,350.9%) and (520.8%), respectively. The valuation allowance remaining at September 30, 2013 is $1.9 million, which primarily relates to a reserve against state and local taxes, where there is sufficient uncertainty as to whether we will be able to utilize this deferred tax asset in the future to necessitate maintaining an allowance. | |||
A valuation allowance is required when it is more likely than not that all or a portion of deferred tax assets may not be realized. Establishment and removal of a valuation allowance requires management to consider all positive and negative evidence and make a judgmental decision regarding the amount of valuation allowance required as of a reporting date. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. In the evaluation as of September 30, 2013, management has considered all available evidence, both positive and negative, including but not limited to the following: | |||
Positive evidence | |||
● | The cumulative net income for the last twelve quarters; | ||
● | The significant growth in revenues and earnings the Company has experienced over the past eight quarters; | ||
● | The implementation and providing services to several new customers and the healthy sales pipeline with several large customers who are close to the point of contract negotiation; | ||
Negative evidence | |||
● | The loss of one large customer in the third quarter ended September 30, 2013; | ||
● | The contract renewal of certain customer’s contracts in 2014; | ||
The determination of when to adjust the valuation allowance requires significant judgment on the part of management. Although realization is not assured, management concluded that it is more likely than not that the majority of deferred tax assets at September 30, 2013 will be realized in the ordinary course of operations. Therefore a valuation allowance related to $17.2 million of deferred tax assets was determined to be unnecessary. | |||
The Company did not generate any cash flow from the income tax benefit recorded to the Condensed Consolidated Statements of Operations in the period ended September 30, 2013, nor did this income tax benefit have any impact on business operations during the period. | |||
Innotrac’s gross deferred tax asset as of September 30, 2013 and December 31, 2012 was approximately $21.5 million and $22.3 million, respectively. This deferred tax asset was generated primarily by net operating loss carryforwards created by net losses in prior years. Innotrac has Federal net operating loss carryforwards of $52.4 million at December 31, 2012 that expire between 2020 and 2032. | |||
ASC topic No. 740 requires that the Company determine whether it is more likely than not that a tax position will be sustained upon audit, based on the technical merits of the position. A tax position that meets the more likely than not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured at the largest amount of benefit that is greater than 50 percent likely of being realized upon ultimate settlement. The Company has recognized tax benefits from all tax positions we have taken, and there has been no adjustment to any net operating loss carryforwards as a result of ASC topic No. 740 and there are no unrecognized tax benefits and no related ASC topic No. 740 tax liabilities at September 30, 2013. | |||
The Company generally recognizes interest and/or penalties related to income tax matters in general and administrative expenses. As of September 30, 2013, we have no accrued interest or penalties related to uncertain tax positions. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies [Abstract] | ' |
COMMITMENTS AND CONTINGENCIES | ' |
5. COMMITMENTS AND CONTINGENCIES | |
Legal Proceedings. The Company is subject to various legal proceedings and claims that arise in the ordinary course of business. There are no material pending legal proceedings to which the Company is a party to as of September 30, 2013. |
RELATED_PARTY_TRANSACTION
RELATED PARTY TRANSACTION | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transaction [Abstract] | ' |
RELATED PARTY TRANSACTION | ' |
6. RELATED PARTY TRANSACTION | |
In early 2004, the Company learned that certain trading activity of the IPOF Fund L.P., an owner of more than 5% of the outstanding Common Stock, may have violated the short-swing profit rules under Section 16(b) of the Securities Exchange Act of 1934. The Company promptly conducted an investigation of the matter. IPOF Fund L.P. and its affiliates entered into a settlement agreement with the Company on March 3, 2004 regarding the potential Section 16(b) liability issues that provided for the Company’s recovery of $301,957 no later than March 3, 2006. In December 2005, the United States District Court in Cleveland, Ohio appointed a receiver to identify and administer the assets of the IPOF Fund, L.P. and its general partner, David Dadante. The Company informed the IPOF receiver of such agreement, but the likelihood of recovering such amount from the receiver is doubtful. The Company has not recorded any estimated receivable from this settlement. Additionally, the Federal Court has indefinitely restricted the financial institutions holding Company stock owned by the IPOF Fund L.P. and Mr. Dadante in margin accounts from selling any of these shares. The court has permitted open market sales by the receiver as he may in his sole discretion determine to be consistent with his duty to maximize the value of the assets of IPOF Fund, L.P. and as warranted by market conditions. The receiver has indicated to the Company that he does not intend to direct any open market sales during this period except in circumstances in which he believes that there would be no material adverse impact on the market price for the Company’s shares. | |
The Company leases a single engine aircraft from a related party company owned by the Chairman/CEO. The Company paid approximately $53,000 and $58,000 related to this lease for the three months ended September 30, 2013 and 2012, respectively. The Company paid approximately $162,000 and $166,000 related to this lease for the nine months ended September 30, 2013 and 2012, respectively. The Company incurred expenses of $367,000 related to improvements to the aircraft in 2012 and will depreciate this amount over the life of the lease. In August 2012, the Company and the Chairman/CEO entered into a new ten-year lease with respect to the aircraft, under the terms of which i) should the airplane not be made available for use as required by the Company, the Chief Executive Officer will reimburse the Company for the undepreciated portion of certain improvements made in August, 2012, and ii) if the Company should cancel the lease of the aircraft before its contract term ending in August 2022, the Company would not require the Chief Executive Officer to reimburse the Company for the undepreciated portion of the improvements. As of September 30, 2013 the undepreciated portion of these improvements amounted to $327,000. |
THE_COMPANY_AND_SIGNIFICANT_AC1
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Principles of Consolidation | ' | ||||||||||||||||
Principles of Consolidation. The financial statements have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company and its majority owned subsidiary. On April 11, 2011 the Company completed the formation of Innotrac Europe GmbH (“Innotrac Europe”), a joint venture between Innotrac and PVS Fulfillment-Service GmbH (“PVS”) in Neckarsulm, Germany. Innotrac has a 50.1% ownership stake in the joint venture. All significant intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||||||
Accounting Estimates | ' | ||||||||||||||||
Accounting Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. | |||||||||||||||||
Accounting for Income Taxes | ' | ||||||||||||||||
Accounting for Income Taxes. Innotrac utilizes the liability method of accounting for income taxes in accordance with ASC topic No. 740 – Income Taxes. Under the liability method, deferred taxes are determined based on the difference between the financial and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. A valuation allowance was recorded against the net deferred tax asset as of December 31, 2012. At September 30, 2013, the Company reversed the majority of the valuation allowance in the amount of $17.2 million, leaving a balance of $1.9 million (see Note 4). | |||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
Revenue Recognition. Innotrac derives its revenue primarily from three sources: (1) fulfillment operations (2) the delivery of call center services integrated with our fulfillment operations and (3) delivering technology solutions and integration services to its clients. Innotrac’s fulfillment services operations record revenue at the conclusion of the material selection, packaging and upon completion of the shipping process. The shipping process is considered complete after transfer to an independent freight carrier and receipt of a bill of lading or shipping manifest from that carrier. Innotrac’s call center service revenue is recognized according to written pricing agreements based on the number of calls, minutes or hourly rates when those calls and time rated services occur. All other revenues are recognized as services are rendered. As required by the consensus reached in ASC topic No. 605 – Revenue Recognition, 1) revenues have been recorded net of the cost of the goods for all fee-for-service clients and 2) the Company records reimbursements received from customers for out-of pocket expenses, primarily freight and postage fees, as revenue and the associated expense as cost of revenue. The Company purchases product for two clients from vendors under agreements that require our clients to buy the product back from us at original cost when product is shipped to our client’s end consumer or after a period of time if the product has not been shipped from our fulfillment centers. The value of these products is paid to Innotrac at the same value paid and no service fees are generated on the product. The value of the purchase is netted against the reimbursement from our customer with a resulting zero value in our reported revenue and costs of revenue. | |||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements. The Company accounts for fair value in accordance with ASC topic No. 820- Fair Value Measurements and Disclosures for all financial and non-financial assets and liabilities accounted for at fair value on a recurring basis. ASC topic No. 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the United States of America, and expands disclosures about fair value measurements. | |||||||||||||||||
The Company determined the fair values of certain financial instruments based on the fair value hierarchy established in ASC topic No. 820. ASC topic No. 820 requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value. | |||||||||||||||||
Level 1: Quoted market prices in active markets for identical assets or liabilities. | |||||||||||||||||
Level 2: Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||||||
Level 3: Unobservable inputs developed using the Company’s estimates and assumptions which reflect those that the market participants would use. | |||||||||||||||||
ASC topic No. 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. | |||||||||||||||||
The carrying value of our cash, accounts receivable and accounts payable approximate their fair value, principally due to the short-term maturities of these instruments. Our debt instruments approximates fair value since our debt instrument consists of a revolving credit line, which under certain conditions can mature within one year of September 30, 2013, and because of its short term nature. The interest rate is equal to the market rate for such instruments of similar duration and credit quality. | |||||||||||||||||
The Company’s assets measured at fair market value on a recurring basis are as follows: | |||||||||||||||||
As of September 30, 2013 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
Total | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
As of December 31, 2012 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
Total | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
-1 | This is an executive deferred compensation plan for certain employees, as designated by the Company’s Board of Directors. The Company invests contributions to this plan in employee-directed marketable equity securities which are recorded in other assets on the accompanying consolidated balance sheets at quoted market prices. The contributions are fully invested in five different mutual funds having various growth, industry and geographic characteristics. | ||||||||||||||||
There were no significant transfers into and out of any level of the fair value hierarchy for assets measured at fair value for the three and nine months ended September 30, 2013 or the year ended December 31, 2012. | |||||||||||||||||
All transfers, if any, are recognized by the Company at the end of each reporting period. | |||||||||||||||||
Transfers between Levels 1 and 2 generally relate to whether a market becomes active or inactive. Transfers between Levels 2 and 3 generally relate to whether significant relevant observable inputs are available for the fair value measurement in their entirety. | |||||||||||||||||
Recent Accounting Pronouncements | ' | ||||||||||||||||
Recent Accounting Pronouncements | |||||||||||||||||
In February 2013, the FASB issued ASU 2013-02 to Topic 220 – Reporting of amounts Reclassified Out of Accumulated Other Comprehensive Income. The amendments to the Codification in this ASU require additional disclosure on the face of financial statements or in the notes to the financial statements, depending on materiality, for amounts reclassified out of accumulated other comprehensive income by component. This ASU supersedes certain presentation requirements of ASU No. 2011-05 and ASU 2011-12 to Topic 220. This amendment to this ASU was effective for reporting periods beginning after December 15, 2012 with early adoption permitted. The Company adopted these provisions in the fourth quarter of 2012. Adoption of this provisions did not have a material impact on the Company’s consolidated financial statements since the Company has only immaterial other comprehensive income amounts. | |||||||||||||||||
In July 2013, the FASB issued ASU 2013-11 to Topic 740 – Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The amendment to the Codification in this ASU requires an unrecognized tax benefit to be presented as a decrease in a deferred tax asset where a net operating loss, a similar tax loss, or a tax credit carryforward exists and certain criteria are met. This ASU is effective prospectively for annual and interim reporting periods beginning after December 15, 2013. The Company is currently evaluating the potential impact of the adoption of this guidance on its consolidated financial statements. |
THE_COMPANY_AND_SIGNIFICANT_AC2
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Schedule of fair value measurements | ' | ||||||||||||||||
As of September 30, 2013 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
Total | $ | 969 | $ | - | $ | - | $ | 969 | |||||||||
As of December 31, 2012 | |||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||
(in 000’s) | |||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||
Active Markets | Other | Unobservable | |||||||||||||||
for Identical | Observable | Inputs | |||||||||||||||
Description | Assets (Level 1) | Inputs (Level 2) | (Level 3) | Total | |||||||||||||
Deferred Compensation plan assets held in Rabbi Trust (1) | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
Total | $ | 837 | $ | - | $ | - | $ | 837 | |||||||||
-1 | This is an executive deferred compensation plan for certain employees, as designated by the Company’s Board of Directors. The Company invests contributions to this plan in employee-directed marketable equity securities which are recorded in other assets on the accompanying consolidated balance sheets at quoted market prices. The contributions are fully invested in five different mutual funds having various growth, industry and geographic characteristics. |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Schedule of computation of diluted earnings per share | ' | ||||||||||||||||
Three Months | Nine Months | ||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Diluted earnings per share: | |||||||||||||||||
Weighted average shares outstanding | 13,245 | 13,058 | 13,199 | 13,033 | |||||||||||||
Employee and director stock options | 22 | - | 16 | - | |||||||||||||
Weighted average shares assuming dilution | 13,267 | 13,058 | 13,215 | 13,033 |
THE_COMPANY_AND_SIGNIFICANT_AC3
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES - Summary of assets measured at fair market value on recurring basis (Details) (Fair Value Recurring Basis, USD $) | Sep. 30, 2013 | Dec. 31, 2012 | ||
In Thousands, unless otherwise specified | ||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Deferred Compensation plan assets held in Rabbi Trust | $969 | [1] | $837 | [1] |
Total | 969 | 837 | ||
Significant Other Observable Inputs (Level 2) | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Deferred Compensation plan assets held in Rabbi Trust | ' | [1] | ' | [1] |
Total | ' | ' | ||
Significant Unobservable Inputs (Level 3) | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Deferred Compensation plan assets held in Rabbi Trust | ' | [1] | ' | [1] |
Total | ' | ' | ||
Total | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Deferred Compensation plan assets held in Rabbi Trust | 969 | [1] | 837 | [1] |
Total | $969 | $837 | ||
[1] | This is an executive deferred compensation plan for certain employees, as designated by the Company's Board of Directors. The Company invests contributions to this plan in employee-directed marketable equity securities which are recorded in other assets on the accompanying consolidated balance sheets at quoted market prices. The contributions are fully invested in five different mutual funds having various growth, industry and geographic characteristics. |
THE_COMPANY_AND_SIGNIFICANT_AC4
THE COMPANY AND SIGNIFICANT ACCOUNTING POLICIES (Detail Textuals) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 |
Center | |
Significant Accounting Policies [Abstract] | ' |
Number of fulfillment centers | 8 |
Number of call centers | 1 |
Percentage of ownership interest in PVS Fulfillment-Service GmbH (PVS) | 50.10% |
Valuation allowance | $17.20 |
Deferred income tax expense offset by corresponding decrease in deferred tax asset valuation allowance | $1.90 |
FINANCING_OBLIGATIONS_Detail_T
FINANCING OBLIGATIONS (Detail Textuals) (SunTrust Bank (the "Bank"), USD $) | Sep. 30, 2013 |
In Millions, unless otherwise specified | |
Standby letter of credit | ' |
Line of Credit Facility [Line Items] | ' |
Maximum borrowing limit | $5 |
Revolving credit facility (the "Credit Facility") | ' |
Line of Credit Facility [Line Items] | ' |
Maximum borrowing limit | $25 |
FINANCING_OBLIGATIONS_Detail_T1
FINANCING OBLIGATIONS (Detail Textuals 1) (Revolving credit facility (the "Credit Facility")) | 9 Months Ended |
Sep. 30, 2013 | |
Line of Credit Facility [Line Items] | ' |
Additional interest rate per annum in case of default | 2.00% |
Description of reference rate | ' |
Interest on borrowings pursuant to the Credit Facility is payable monthly at the LIBOR Rate plus between 1.50% and 2.50% per annum, depending on the Company’s Senior Leverage Ratio (as defined in the Credit Facility). In an event of default, the Bank has the right to charge interest at the otherwise applicable rate plus 2.00% per annum. The facility carries a quarterly commitment fee calculated based upon average daily undrawn availability under the Credit Facility multiplied by an applicable percentage ranging between 0.25% and 0.50% per annum depending on the Company’s Senior Leverage Ratio (as defined in the Credit Facility). | |
Base Rate | Minimum | ' |
Line of Credit Facility [Line Items] | ' |
Credit facilities applicable interest rate | 0.25% |
Base Rate | Maximum | ' |
Line of Credit Facility [Line Items] | ' |
Credit facilities applicable interest rate | 0.50% |
LIBOR Rate | Minimum | ' |
Line of Credit Facility [Line Items] | ' |
Credit facilities applicable interest rate | 1.50% |
LIBOR Rate | Maximum | ' |
Line of Credit Facility [Line Items] | ' |
Credit facilities applicable interest rate | 2.50% |
FINANCING_OBLIGATIONS_Detail_T2
FINANCING OBLIGATIONS (Detail Textuals 2) (Revolving credit facility (the "Credit Facility"), SunTrust Bank (the "Bank"), USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Revolving credit facility (the "Credit Facility") | SunTrust Bank (the "Bank") | ' |
Line Of Credit Facility [Line Items] | ' |
Fixed charge coverage ratio | '1.05 to 1.00 |
Threshold limit of adjusted EBITDA | $5,000,000 |
Maximum senior leverage ratio | 'either 2.5 to 1.00 or 3.0 to 1.00 |
FINANCING_OBLIGATIONS_Detail_T3
FINANCING OBLIGATIONS (Detail Textuals 3) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Line of Credit Facility [Line Items] | ' | ' | ' | ' |
Interest expense | $41,000 | $90,000 | $196,000 | $212,000 |
Revolving credit facility (the "Credit Facility") | SunTrust Bank (the "Bank") | ' | ' | ' | ' |
Line of Credit Facility [Line Items] | ' | ' | ' | ' |
Interest expense | 2,000 | 1,000 | 3,000 | 7,000 |
Weighted average interest rate on credit facility | 2.69% | 3.27% | 2.09% | 3.28% |
Rate of interest being charged on the Credit Facility | 1.68% | ' | 1.68% | ' |
Unused credit facility fees | $15,000 | $23,000 | $60,000 | $75,000 |
FINANCING_OBLIGATIONS_Detail_T4
FINANCING OBLIGATIONS (Detail Textuals 4) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Capital Leased Assets [Line Items] | ' | ' | ' | ' | ' |
Capital leases including interest and taxes | ' | ' | $2,000,000 | ' | $1,100,000 |
Principal balance repaid for capital lease | 106,000 | 105,000 | 326,000 | 321,000 | ' |
Interest expense related to capital leases | $14,000 | $25,000 | $48,000 | $52,000 | ' |
Minimum | ' | ' | ' | ' | ' |
Capital Leased Assets [Line Items] | ' | ' | ' | ' | ' |
Term of capital lease | ' | ' | '3 years | ' | ' |
Maximum | ' | ' | ' | ' | ' |
Capital Leased Assets [Line Items] | ' | ' | ' | ' | ' |
Term of capital lease | ' | ' | '5 years | ' | ' |
EARNINGS_PER_SHARE_Summary_of_
EARNINGS PER SHARE - Summary of shares used in computing diluted earnings per share (Details) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Diluted earnings per share: | ' | ' | ' | ' |
Weighted average shares outstanding | 13,245 | 13,058 | 13,199 | 13,033 |
Employee and director stock options | 22 | ' | 16 | ' |
Weighted average shares assuming dilution | 13,267 | 13,058 | 13,215 | 13,033 |
EARNINGS_PER_SHARE_Detail_Text
EARNINGS PER SHARE (Detail Textuals) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
31-May-11 | Jun. 30, 2011 | Jun. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Employees | Non-employee Directors | Stock Options | Stock Options | Stock Options | Stock Options | Restricted Shares | Restricted Shares | Restricted Shares | Restricted Shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Anti dilutive, options outstanding (in shares) | ' | ' | ' | 286,000 | 351,000 | 286,000 | 351,000 | ' | ' | ' | ' |
Restricted shares included in EPS calculation | ' | ' | ' | ' | ' | ' | ' | 910,637 | 820,637 | 910,637 | 820,637 |
Percentage shares, other than restricted shares for non-employee directors, vested on 7th, 8th, 9th and 10th anniversary | 25.00% | 25.00% | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' |
INCOME_TAXES_Detail_Textuals
INCOME TAXES (Detail Textuals) (USD $) | 3 Months Ended | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Gross deferred tax asset | $21.50 | $21.50 | $22.30 |
Federal net operating loss carryforwards | ' | ' | 52.4 |
Federal net operating loss carryforwards expiration period | ' | 'expire between 2020 and 2032 | ' |
Valuation allowance | 17.2 | 17.2 | ' |
Deferred income tax expense offset by corresponding decrease in deferred tax asset valuation allowance | ' | $1.90 | ' |
Percentage of maximum tax position measured | ' | 50.00% | ' |
Effective income tax rate | 1350.90% | 520.80% | ' |
RELATED_PARTY_TRANSACTION_Deta
RELATED PARTY TRANSACTION (Detail Textuals) (USD $) | Mar. 03, 2004 |
Related Party Transaction [Abstract] | ' |
Ownership interest in outstanding common stock by IPOF Fund L.P exceeds this percentage | 5.00% |
Amount receivable under settlement agreement from IPOF Fund L.P. for Violating Section 16(b) | $301,957 |
RELATED_PARTY_TRANSACTION_Deta1
RELATED PARTY TRANSACTION (Detail Textuals 1) (Chairman And Chief Executive Officer, USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Chairman And Chief Executive Officer | ' | ' | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' |
Aircraft lease paid | $53,000 | $58,000 | $162,000 | $166,000 | ' |
Lease term with respect to aircraft | ' | ' | '10 years | ' | ' |
Improvements to aircraft | $327,000 | ' | $327,000 | ' | $367,000 |