Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 03, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,016 | |
Entity Registrant Name | EVOLVING SYSTEMS INC | |
Trading Symbol | evol | |
Entity Central Index Key | 1,052,054 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 11,907,391 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 6,941 | $ 8,400 |
Contract receivables, net of allowance for doubtful accounts of $74 at September 30, 2016 and $83 at December 31, 2015 | 5,904 | 7,727 |
Unbilled work-in-progress | 3,725 | 4,158 |
Prepaid and other current assets | 1,792 | 1,459 |
Total current assets | 18,362 | 21,744 |
Property and equipment, net | 359 | 560 |
Amortizable intangible assets, net | 4,396 | 4,983 |
Goodwill | 21,269 | 23,142 |
Total assets | 44,386 | 50,429 |
Current liabilities: | ||
Current portion of capital lease obligations | 3 | 5 |
Revolving line of credit | 10,000 | |
Term loan - current | 1,492 | |
Accounts payable and accrued liabilities | 4,332 | 4,607 |
Income taxes payable | 579 | 324 |
Unearned revenue | 4,284 | 3,330 |
Total current liabilities | 10,690 | 18,266 |
Long-term liabilities: | ||
Capital lease obligations, net of current portion | 1 | |
Term loan, net of current portion | 4,500 | |
Total liabilities | 15,190 | 18,267 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.001 par value; 2,000,000 shares authorized; no shares issued and outstanding as of September 30, 2016 and December 31, 2015 | ||
Common stock, $0.001 par value; 40,000,000 shares authorized; 12,085,702 shares issued and 11,906,813 outstanding as of September 30, 2016 and 11,970,731 shares issued and 11,791,842 outstanding as of December 31, 2015 | 12 | 12 |
Additional paid-in capital | 97,681 | 97,418 |
Treasury stock 178,889 shares as of September 30, 2016 and December 31, 2015, at cost | (1,253) | (1,253) |
Accumulated other comprehensive loss | (8,780) | (5,999) |
Accumulated deficit | (58,464) | (58,016) |
Total stockholders' equity | 29,196 | 32,162 |
Total liabilities and stockholders' equity | $ 44,386 | $ 50,429 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Condensed Consolidated Balance Sheets [Abstract] | ||
Allowance for doubtful accounts receivable | $ 74 | $ 83 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares issued | 12,085,702 | 11,970,731 |
Common stock, shares outstanding | 11,906,813 | 11,791,842 |
Treasury stock, shares | 178,889 | 178,889 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
REVENUE | ||||
License fees and services | $ 3,557 | $ 3,228 | $ 10,616 | $ 11,177 |
Customer support | 2,546 | 2,545 | 8,045 | 7,327 |
Total revenue | 6,103 | 5,773 | 18,661 | 18,504 |
COSTS OF REVENUE AND OPERATING EXPENSES | ||||
Costs of license fees and services, excluding depreciation and amortization | 961 | 1,043 | 2,968 | 3,458 |
Costs of customer support, excluding depreciation and amortization | 298 | 396 | 1,003 | 1,116 |
Sales and marketing | 1,236 | 1,336 | 3,807 | 4,435 |
General and administrative | 952 | 1,010 | 2,774 | 2,943 |
Product development | 697 | 913 | 2,485 | 2,887 |
Depreciation | 57 | 97 | 205 | 277 |
Amortization | 196 | 24 | 587 | 71 |
Restructuring | 3 | 1,007 | ||
Total costs of revenue and operating expenses | 4,400 | 4,819 | 14,836 | 15,187 |
Income from operations | 1,703 | 954 | 3,825 | 3,317 |
Other income (expense) | ||||
Interest income | 1 | 5 | 4 | 14 |
Interest expense | (74) | (3) | (265) | (9) |
Foreign currency exchange loss | (261) | (244) | (508) | (218) |
Other expense, net | (334) | (242) | (769) | (213) |
Income from operations before income taxes | 1,369 | 712 | 3,056 | 3,104 |
Income tax expense | 428 | 142 | 908 | 894 |
Net income | $ 941 | $ 570 | $ 2,148 | $ 2,210 |
Basic income per common share | $ 0.08 | $ 0.05 | $ 0.18 | $ 0.19 |
Diluted income per common share | $ 0.08 | 0.05 | 0.18 | 0.19 |
Cash dividend declared per common share | $ 0.11 | $ 0.22 | $ 0.33 | |
Weighted average basic shares outstanding | 11,873 | 11,687 | 11,824 | 11,677 |
Weighted average diluted shares outstanding | 11,979 | 11,927 | 11,967 | 11,938 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements Of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Condensed Consolidated Statements Of Comprehensive Income (Loss) [Abstract] | ||||
Net income | $ 941 | $ 570 | $ 2,148 | $ 2,210 |
Other comprehensive loss: | ||||
Foreign currency translation loss | (753) | (975) | (2,781) | (909) |
Comprehensive income (loss) | $ 188 | $ (405) | $ (633) | $ 1,301 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement Of Changes In Stockholders' Equity - 9 months ended Sep. 30, 2016 - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Loss [Member] | Accumulated (Deficit) [Member] | Total |
Balance at Dec. 31, 2015 | $ 12 | $ 97,418 | $ (1,253) | $ (5,999) | $ (58,016) | $ 32,162 |
Balance, shares at Dec. 31, 2015 | 11,791,842 | 11,791,842 | ||||
Stock option exercises | 50 | $ 50 | ||||
Stock option exercises, shares | 111,785 | |||||
Common stock issued pursuant to the Employee Stock Purchase Plan | 15 | 15 | ||||
Common stock issued pursuant to the Employee Stock Purchase Plan, shares | 3,186 | |||||
Stock-based compensation expense | 198 | 198 | ||||
Common stock dividends declared | (2,596) | (2,596) | ||||
Net income | 2,148 | 2,148 | ||||
Foreign currency translation adjustment | (2,781) | (2,781) | ||||
Balance at Sep. 30, 2016 | $ 12 | $ 97,681 | $ (1,253) | $ (8,780) | $ (58,464) | $ 29,196 |
Balance, shares at Sep. 30, 2016 | 11,906,813 | 11,906,813 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 2,148 | $ 2,210 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 205 | 277 |
Amortization of intangible assets | 587 | 71 |
Amortization of debt issuance costs | 27 | 8 |
Stock based compensation | 198 | 229 |
Unrealized foreign currency transaction loss, net | 508 | 218 |
Provision from deferred income taxes | (18) | (25) |
Change in operating assets and liabilities: | ||
Contract receivables | 735 | (137) |
Unbilled work-in-progress | 9 | 1,604 |
Prepaid and other assets | (389) | (183) |
Accounts payable and accrued liabilities | 202 | (934) |
Unearned revenue | 1,326 | (439) |
Net cash provided by operating activities | 5,538 | 2,899 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (24) | (191) |
Business combinations, net of cash | (9,014) | |
Net cash used in investing activities | (24) | (9,205) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Capital lease payments | (4) | (4) |
Proceeds of the revolving line of credit | 10,000 | |
Payments of the revolving line of credit | (10,000) | |
Proceeds from the term loan | 6,000 | |
Payments for debt issuance costs | (20) | |
Common stock cash dividends | (2,596) | (3,844) |
Proceeds from the issuance of stock | 65 | 73 |
Net cash provided by (used in) financing activities | (6,555) | 6,225 |
Effect of exchange rate changes on cash | (418) | (290) |
Net decrease in cash and cash equivalents | (1,459) | (371) |
Cash and cash equivalents at beginning of period | 8,400 | 9,781 |
Cash and cash equivalents at end of period | 6,941 | 9,410 |
Supplemental disclosure of cash and non-cash transactions: | ||
Income taxes paid | 791 | 1,092 |
Property and equipment purchased and included in accounts payable | $ 1 | $ 12 |
Basis Of Presentation
Basis Of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Basis Of Presentation [Abstract] | |
Basis Of Presentation | NOTE 1 — BASIS OF PRESENTATION Organization — We are a provider of software solutions and services to the wireless, wireline and cable markets. We maintain long-standing relationships with many of the largest wireless, wireline and cable companies worldwide. Our customers rely on us to develop, deploy, enhance and maintain software solutions that provide a variety of service activation and provisioning functions. Our service activation solution, Tertio ® (“TSA”) is used to activate bundles of voice, video and data services for wireless, wireline and cable network operators; our SIM card activation solution, Dynamic SIM Allocation TM (“DSA”) is used to dynamically allocate and assign resources to Mobile Network Operators (“MNOs”) devices that rely on SIM cards; our Mobile Data Enablement TM (“MDE”) solution provides a data consumption and policy management solution for wireless carriers and Mobile Virtual Network Operators (“MVNOs”) that monitor the usage and consumption of data services; our Total Number Management™ (“TNM”) product is a scalable and fully automated database solution that enables operators to reliably and efficiently manage their telephone numbers as well as other communication identifiers (i.e. SIMs, MSISDNs, IMSIs, ICCIDs, IPs). Our solutions can be deployed on premise or offered as a Software-as-a-Service (“SaaS”). On September 30, 2015 we announced the acquisition of privately held RateIntegration, Inc., d/b/a Sixth Sense Media (“SSM”), a provider of real time analytics and marketing solutions to wireless carriers. SSM’s software solution platform, Real-time Lifecycle Marketing ™ (“RLM”), enables carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real time. We believe the addition of SSM’s RLM product to our existing service activation and data enablement products will produce a powerful platform for wireless carriers. A product suite which we refer to as our Mobile Marketing Solutions (“MMS”) will provide sophisticated, highly tailored mobile campaigns which can be executed based on critical subscriber data captured during the initial activation experience (DSA and RLM) as well as in-life subscriber usage via MDE. We see the opportunity to leverage our technology to provide MNOs with sophisticated mobile marketing campaigns that will extend beyond voice, text and data usage campaigns and provide marketing services that will assist MNOs to market services that include retail mobile marketing, gaming, streaming video as well as social media based campaigns. Interim Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2015 included in our Annual Report on Form 10-K. Reclassifications - Certain reclassifications have been made to the 2015 financial statements to conform to the consolidated 2016 financial statement presentation. These reclassifications had no effect on net earnings or cash flows as previously reported. Use of Estimates — The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. We made estimates with respect to revenue recognition for estimated hours to complete projects accounted for using the percentage-of-completion method, allowance for doubtful accounts, income tax valuation allowance, fair values of long-lived assets, valuation of intangible assets and goodwill, useful lives for property, equipment and intangible assets, business combinations, capitalization of internal software development costs and fair value of stock-based compensation amounts. Actual results could differ from these estimates. Foreign Currency — Our functional currency is the U.S. dollar. The functional currency of our foreign operations is the respective local currency for each foreign subsidiary. Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. Our consolidated statements of income are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the consolidated statements of operations in the period in which they occur. Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. Goodwill — Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired. Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. Intangible Assets — Amortizable intangible assets consist primarily of purchased software and licenses, customer contracts and relationships, trademarks and tradenames, non-competition and business partnerships acquired in conjunction with our purchase of Telespree Communications (“Evolving Systems Labs, Inc.”) and RateIntegration, Inc. d/b/a Sixth Sense Media (“Evolving Systems NC, Inc.”). These assets are amortized using the straight-line method over their estimated lives. We assess the impairment of identifiable intangibles if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. If we determine that the carrying value of intangibles and/or long-lived assets may not be recoverable, we compare the estimated undiscounted cash flows expected to result from the use of the asset and its eventual disposition to the asset’s carrying amount. If an amortizable intangible or long-lived asset is not deemed to be recoverable, we recognize an impairment loss representing the excess of the asset’s carrying value over its estimated fair value. Fair Value Measurements — Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. Cash and Cash Equivalents — All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. Revenue Recognition — We recognize revenue when an agreement is signed, the fee is fixed or determinable and collectability is reasonably assured. We recognize revenue from two primary sources: license fees and services, and customer support. The majority of our license fees and services revenue is generated from fixed-price contracts, which provide for licenses to our software products and services to customize such software to meet our customers’ use and managed services which leverages our expertise and software solutions to optimize our customers networks and create new revenue streams. When the customization services are determined to be essential to the functionality of the delivered software, we recognize revenue using the percentage-of-completion method of accounting. In these types of arrangements, we do not typically have Vendor Specific Objective Evidence (“VSOE”) of fair value on the license fee/services portion (services are related to customizing the software) of the arrangement due to the large amount of customization required by our customers; however, we do have VSOE for the warranty/maintenance services based on the renewal rate of the first year of maintenance in the arrangement. The license/services portion is recognized using the percentage-of-completion method of accounting, managed services is recognized as services are performed or ratably over the contract period and the warranty/maintenance services are separated based on the renewal rate in the contract and recognized ratably over the warranty or maintenance period. We estimate the percentage-of-completion for each contract based on the ratio of direct labor hours incurred to total estimated direct labor hours and recognize revenue based on the percent complete multiplied by the contract amount allocated to the license fee/services. Since estimated direct labor hours, and changes thereto, can have a significant impact on revenue recognition, these estimates are critical and we review them regularly. If the arrangement includes a customer acceptance provision, the hours to complete the acceptance testing are included in the total estimated direct labor hours; therefore, the related revenue is recognized as the acceptance testing is performed. Revenue is not recognized in full until the customer has provided proof of acceptance on the arrangement. Generally, our contracts are accounted for individually. However, when certain criteria are met, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. We record amounts billed in advance of services being performed as unearned revenue. Unbilled work-in-progress represents revenue earned but not yet billable under the terms of the fixed-price contracts. All such amounts are expected to be billed and collected within 12 months. We may encounter budget and schedule changes or increases on fixed-price contracts caused by increased labor or overhead costs. We make adjustments to cost estimates in the period in which the facts requiring such revisions become known. We record estimated losses, if any, in the period in which current estimates of total contract revenue and contract costs indicate a loss. If revisions to cost estimates are obtained after the balance sheet date but before the issuance of the interim or annual financial statements, we make adjustments to the interim or annual financial statements accordingly. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when a license agreement has been signed, delivery and acceptance have occurred, the fee is fixed or determinable and collectability is reasonably assured. Where applicable, we unbundle and record as revenue fees from multiple element arrangements as the elements are delivered to the extent that VSOE of fair value of the undelivered elements exist. If VSOE for the undelivered elements does not exist, we defer fees from such arrangements until the earlier of the date that VSOE does exist on the undelivered elements or all of the elements have been delivered. We recognize revenue from fixed-price service contracts using the proportional performance method of accounting, which is similar to the percentage-of-completion method described above. We recognize revenue from professional services provided pursuant to time-and-materials based contracts and training services as the services are performed, as that is when our obligation to our customers under such arrangements is fulfilled. We recognize revenue from managed service as services are performed or ratably based on the terms and conditions of the contract. We recognize revenue from our MDE contracts based on the number of transactions per month multiplied by a factor based on a unique table for transaction volumes relating to each account. We recognize customer support, including maintenance revenue, ratably over the service contract period. When maintenance is bundled with the original license fee arrangement, its fair value, based upon VSOE, is deferred and recognized during the periods when services are provided. We review and update our contract-related estimates regularly. We recognize adjustments in estimated profit on contracts under the reallocation method. Under the reallocation method, the impact of an adjustment in estimate is recognized prospectively over the remaining contract term. No adjustment on any one contract was material to our unaudited Consolidated Financial Statements in the three and nine months ended September 30, 2016 and 2015. Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. Stock-based compensation is a non-cash expense because we settle these obligations by issuing shares of our common stock instead of settling such obligations with cash payments. We use the Black-Scholes model to estimate the fair value of each option grant on the date of grant. This model requires the use of estimates for expected term of the options and expected volatility of the price of our common stock. Comprehensive Income (Loss) — Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to revenue, expenses, gains, and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” Topic 606. This Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this Update supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of dis closure requirements that will pro vide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a report ing organization’s contracts with customers. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers,” Topic 606: “Identifying Performance Obligations and Licensing”. This Update clarifies guidance related to identifying performance obligations and licensing implementation guidance contained in the new revenue recognition standard. The Update includes targeted improvements based on input the Board received from the Transition Resource Group for Revenue Recognition and other stakeholders. The update seeks to proactively address areas in which diversity in practice potentially could arise, as well as to reduce the cost and complexity of applying certain aspects of the guidance both at implementation and on an ongoing basis. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers,” Topic 606: “Narrow-Scope Improvements and Practical Expedients”. The amendments in this Update address narrow-scope improvements to the guidance on collectibility, noncash consideration, and completed contracts at transition. Additionally, the amendments in this Update provide a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. This ASU is the final version of Proposed Accounting Standards Update 2015-320, “Revenue from Contracts with Customers,” (Topic 606): “Narrow-Scope Improvements and Practical Expedients,” which has been deleted. This ASU is effective retrospectively for fiscal years, and interim periods within those years beginning after December 15, 2017 for public companies and 2018 for non-public entities. We do not expect the adoption of this standard to have a significant impact on the Company’s financial position and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to put most leases on their balance sheets by recognizing a lessee’s rights and obligations, while expenses will continue to be recognized in a similar manner to today’s legacy lease accounting guidance. This ASU could also significantly affect the financial ratios used for external reporting and other purposes, such as debt covenant compliance. This ASU will be effective for us on January 1, 2019, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718), which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The standard is effective for annual periods beginning after December 15, 2016, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2016 | |
Acquisition [Abstract] | |
Acquisition | NOTE 2 — ACQUISITION On September 30, 2015 we acquired privately held RateIntegration, Inc. d/b/a Sixth Sense Media (“SSM”), now known as Evolving Systems NC, Inc. for an initial payment of approximately $9.75 million and a $0.5 million working capital adjustment. We also agreed to make a payment on the one year anniversary of the transaction of $250,000 , with such payment being available to secure RateIntegration’s representations and warranties in the agreement. This payment has not been paid to date because the reconciliation of adjustments has not been finalized. We accounted for this business combination by applying the acquisition method, and accordingly, the purchase price was allocated to the assets and liabilities assumed based upon their fair values at the acquisition date. The excess of the purchase price over the net assets and liabilities, approximately $ 6.9 million, was recorded as goodwill. The results of RateIntegration’s operations have been included in the consolidated financial statements since the acquisition date. We believe this acquisition complements our activation and SIM management products. Combining SSM’s real-time analytics and campaign capabilities with our DSA and MDE solutions will allow the company to offer global wireless carriers solutions that utilize the highly valuable contextual data captured from the subscribers’ initial welcome experience via DSA, their ongoing network usage via RLM and their on-device app usage via MDE. The combined solutions will create a highly personalized experience that engages subscribers in real time from the first time subscribers power on their new devices right through their day-to-day usage. Our strategic focus is primarily on the wireless markets in the areas of mobile marketing upsell, carrier service optimization, customer information monetization, customer acquisition acceleration, subscriber activation, SIM card management and activation, self—service mobile applications, data enablement solutions and connected device activation. Total purchase price is summarized as follows (in thousands): September 30, 2015 Cash Consideration Initial Cash Purchase Price $ 9,750 Cash/Working Capital Adjustment 535 Total Cash Consideration $ 10,285 Assumed Liabilities 250 Total purchase price $ 10,535 The following table summarizes the preliminary estimated fair values of the assets and liabilities assumed at the acquisition date (in thousands): September 30, 2015 Cash and cash equivalents $ 1,521 Contract receivables 1,057 Unbilled work-in-progress 89 Intangible assets 4,642 Prepaid and other current assets 68 Other assets, non-current 32 Total identifiable assets acquired $ 7,409 Accounts payable and accrued liabilities $ 1,506 Deferred tax liability 1,760 Deferred revenue 557 Total identifiable liabilities acquired $ 3,823 Net identifiable assets acquired 3,586 Goodwill 6,949 Net assets acquired $ 10,535 We recorded $4.6 million in intangible assets as of the acquisition date with a weighted-average amortization period of approximately seven years and are amortizing the value of the trade name, technology, non-competition and customer relationships over an estimated useful life of 2, 8, 2 and 7 years, respectively. Amortization expense related to the acquired intangible assets of $0.7 million was recorded through the period ended September 30, 2016. The $5.4 million of goodwill was assigned to the license and service segment and $ 1.5 million was assigned to the customer support segment. The goodwill recognized is attributed primarily to expected synergies and the assembled workforce of SSM. As of the date of this report there were no changes in the recognized amounts of goodwill resulting from the acquisition of SSM. Intangible assets related to the Evolving Systems NC, Inc.’s acquisition as of September 30, 2016 (in thousands): September 30, 2016 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 1,679 $ 210 $ 1,469 8 yrs Trademarks and tradenames 122 61 61 2 yrs Non-competition 33 17 16 2 yrs Customer relationships 2,808 401 2,407 7 yrs $ 4,642 $ 689 $ 3,953 7.19 yrs Pro Forma Evolving Systems NC, Inc. contributed revenues of $ 3.9 million and net income of $0.9 million for the period from January 1, 2016 through September 30, 2016. The following unaudited pro forma financial information reflects the consolidated results of operations as if the acquisition of SSM had taken place on January 1, 2015. The pro forma information includes adjustments for the amortization of intangible assets. The pro forma financial information is not necessarily indicative of the results of operations as they would have been had the transaction been effected on the assumed date (in thousands). For the Nine Months Ended September 30, 2016 – Actual 2015 – Pro-forma Revenue $ 18,661 $ 23,118 Net Income 2,148 2,559 |
Goodwill And Intangible Assets
Goodwill And Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill And Intangible Assets [Abstract] | |
Goodwill And Intangible Assets | NOTE 3 — GOODWILL AND INTANGIBLE ASSETS Changes in the carrying amount of goodwill by reporting unit were as follows (in thousands): License and Services Customer Support Total U.S. India U.K. U.S. U.K. Goodwill Balance as of December 31, 2015 $ 6,281 $ 184 $ 6,767 $ 1,549 $ 8,361 $ 23,142 Effects of changes in foreign currency exchange rates (1) - (2) (837) - (1,034) (1,873) Balance at September 30, 2016 $ 6,281 $ 182 $ 5,930 $ 1,549 $ 7,327 $ 21,269 (1) Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. We performed our annual goodwill impairment test as of July 31, 2016, at which time we had $21.5 million of goodwill included the following reporting units, License and Services (“L&S”) — US of $6 .3 million, India of $0.2 million and UK of $6.1 million and Customer Support (“CS”) — US of $1 .5 million and UK of $7.4 million. The fair value of each reporting unit was estimated using both market and income based approaches. Specifically, we incorporated observed market multiple data from selected guideline public companies and values arrived at through the application of discounted cash flow analyses which in turn were based upon our financial projections as of the valuation date. In our analysis, we weighted the application of discounted cash flow analysis at 70% and observed market multiple data from selected guideline public companies at 30% . This analysis requires significant judgments, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for each reporting unit. If the carrying value of a reporting unit were to exceed its fair value, we would then be required to perform a second step of the impairment analysis which could lead to goodwill impairment should the carrying amount exceed the fair value. The excess of carrying amount over fair value would be charged to operations as an impairment loss. If the projected future performance of either of our segments as estimated in the income valuation approach is adjusted downward or is lower than expected in the future, we could be required to record a goodwill impairment charge. As a result of the first step of the 2016 goodwill impairment analysis, the fair value of each reporting unit exceeded its carrying value. Therefore the second step was not necessary. However, a hypothetical decrease of approximately 18% and 23% , respectfully, due to lower than estimated future cash flows in the estimated fair values of our L&S-U.S. and CS-U.S. reporting units would result in its carrying value exceeding its estimated fair value and therefore require the second step, which could result in impairment for that reporting unit. From July 31, 2016 through the date of this report, no events have occurred that we believe may have impaired goodwill. As a result of the acquisition of SSM, $6.9 million of goodwill was acquired, of which $5.4 million was assigned to the license and service segment and $1.5 million was assigned to the customer support segment. We amortized identifiable intangible assets for Evolving Systems Labs, Inc. and Evolving Systems NC, Inc. on a straight-line basis over their estimated lives ranging from one to eight years. As of September 30, 2016 and December 31, 2015, identifiable intangibles were as follows (in thousands): September 30, 2016 December 31, 2015 Gross Amount Accumulated Amortization Net Carrying Amount Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,118 $ 370 $ 1,748 $ 2,118 $ 171 $ 1,947 7.3 yrs Trademarks and tradenames 185 98 87 185 43 142 2.6 yrs Non-competition 33 16 17 33 4 29 2.0 yrs Customer relationships 3,024 480 2,544 3,024 159 2,865 6.8 yrs $ 5,360 $ 964 $ 4,396 $ 5,360 $ 377 $ 4,983 6.8 yrs Amortization expense of identifiable intangible assets was $ 0 .2 million and $24,000 for the three months and $0.6 million and $71,000 for the nine months ended September 30, 2016 and 2015, respectively. Expected future amortization expense related to identifiable intangibles based on our carrying amount as of September 30, 2016 was as follows (in thousands): Twelve months ending September 30, 2017 $ 783 2018 705 2019 694 2020 693 2021 693 Thereafter 828 $ 4,396 |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | NOTE 4 — EARNINGS PER COMMON SHARE We compute basic earnings per share (“EPS”) by dividing net income or loss available to common stockholders by the weighted average number of shares outstanding during the period, including common stock issuable under participating securities. We compute diluted EPS using the weighted average number of shares outstanding, including participating securities, plus all potentially dilutive common stock equivalents. Common stock equivalents consist of stock options. Our policy is to treat unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, as participating securities, included in the computation of both basic and diluted earnings per share. The following is the reconciliation of the denominator of the basic and diluted EPS computations (in thousands, except per share data): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Basic income per share: Net income available to common stockholders $ 941 $ 570 $ 2,148 $ 2,210 Basic weighted average shares outstanding 11,873 11,687 11,824 11,677 Basic income per share: $ 0.08 $ 0.05 $ 0.18 $ 0.19 Diluted income per share: Net income available to common stockholders $ 941 $ 570 $ 2,148 $ 2,210 Weighted average shares outstanding 11,873 11,687 11,824 11,677 Effect of dilutive securities - options 106 240 143 261 Diluted weighted average shares outstanding 11,979 11,927 11,967 11,938 Diluted income per share: $ 0.08 $ 0.05 $ 0.18 $ 0.19 For the three months ended September 30, 2016 and 2015, 0.5 million and 0.3 million shares, respectively, of common stock were excluded from the dilutive stock calculation because their exercise prices were greater than the average fair value of our common stock for the period. For the nine months ended September 30, 2016 and 2015, 0.5 million and 0.3 million shares, respectively of common stock were excluded from the dilutive stock calculation because their exercise prices were greater than the average fair value of our common stock for the period. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Share-Based Compensation [Abstract] | |
Share-Based Compensation | NOTE 5 — SHARE-BASED COMPENSATION We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors, and record compensation cost for all stock awards granted after January 1, 2006 and awards modified, repurchased, or cancelled after that date, using the modified prospective method. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. We recogn ized $0.1 million of compensation expense in the consolidated statements of operations, with respect to our stock-based compensation plans for the three months ended September 30, 2016 and 2015 and $0.2 million for the nine months ended September 30, 2016 and 2015. The following table summarizes stock-based compensation expenses recorded in the consolidated statement of operations (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Cost of license fees and services, excluding depreciation and amortization $ 7 $ 17 $ 27 $ 56 Cost of customer support, excluding depreciation and amortization 1 3 5 8 Sales and marketing 7 10 20 26 General and administrative 20 23 90 76 Product development 17 16 56 63 Total share based compensation $ 52 $ 69 $ 198 $ 229 Stock Incentive Plans In June 2007, our stockholders approved the 2007 Stock Incentive Plan (the “2007 Stock Plan”) with a maximum of 1,000,000 shares reserved for issuance. In June 2010, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 1,250,000 . In June 2013, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 1,502,209 . In June 2015, our stockholders approved an amendment to the 2007 Stock Plan which increased the maximum shares that may be awarded under the plan to 2,002,209 . Awards permitted under the 2007 Stock Plan include: Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Awards and Other Stock-Based Awards. Awards issued under the 2007 Stock Plan are at the discretion of the Board of Directors. As applicable, awards are granted with an exercise price equal to the closing price of our common stock on the date of grant, generally vest over four years for employees and three years for an initial grant and one year for subsequent grants for directors and expire no more than ten years from the date of grant. At September 30, 2016, there were approximately 0.3 million shares available for grant under the 2007 Stock Plan, as amended of which 0.2 million shares were reserved for acquisitions. At September 30, 2016 and December 31, 2015, 0 .7 million and 0.8 million were issued and outstanding under the 2007 Stock Plan as amended, respectively. In June 2016, our stockholders approved the 2016 Stock Incentive Plan (the “2016 Stock Plan”) with a maximum of 250,000 shares reserved for issuance. Awards permitted under the 2016 Stock Plan include: Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Awards and Other Stock-Based Awards. Awards issued under the 2016 Stock Plan are at the discretion of the Board of Directors. As applicable, awards are granted with an exercise price equal to the closing price of our common stock on the date of grant, generally vest over four years for employees and three years for an initial grant and one year for subsequent grants for directors and expire no more than ten years from the date of grant. At September 30, 2016, no awards have been granted under the 2016 Stock Plan. During the three and nine months ended September 30, 2016 no grants of restricted stock were offered to members of our senior management. During the three months ended September 30, 2015 there were 20,000 grants of restricted stock to members of our senior management. During the three and nine months ended September 30, 2016 5,000 shares of restricted stock vested. During the three and nine months ended September 30, 2015, 0 and 94 shares of restricted stock vested, respectively. No shares of restricted stock were forfeited during the three and nine months ended September 30, 2016. No shares of restricted stock were forfeited during the three months ended September 30, 2015 and 1,031 shares of restricted stock were forfeited during the nine months ended September 30, 2015. The fair market value of restricted shares for share-based compensation expensing is equal to the closing price of our common stock on the date of grant. Stock-based compensation expense includes $ 8,000 for the three months ended September 30, 2016 and no expense for three months ended September 30, 2015, and $ 2 3,000 and $1,000 for the nine months ended September 30, 2016 and 2015, respectively, of expense related to restricted stock grants. The restrictions on the stock awards are released quarterly, generally over two and four years for senior management and over one year for board members. The fair value of each option grant is estimated on the date of grant using the Black-Scholes model. The Black-Scholes model uses four assumptions to calculate the fair value of each option grant. The expected term of share options granted is derived using the simplified method, which we adopted in January 2008. The risk-free interest rate is based upon the rate currently available on zero-coupon U.S. Treasury instruments with a remaining term equal to the expected term of the stock options. The expected volatility is based upon historical volatility of our common stock over a period equal to the expected term of the stock options. The expected dividend yield is based upon historical and anticipated payment of dividends. The weighted-average assumptions used in the fair value calculations are as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Expected term (years) 6.0 6.0 6.0 6.0 Risk-free interest rate 1.10 % 1.37 % 1.32 % 1.37 % Expected volatility 36.55 % 37.76 % 36.81 % 42.47 % Expected dividend yield 4.23 % 7.33 % 7.22 % 6.32 % The following is a summary of stock option activity under the plans for the nine months ended September 30, 2016: Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Term Value (in thousands) Price (Years) (in thousands) Options outstanding at December 31, 2015 834 $ 5.97 6.94 $ 957 Options granted 158 5.31 Less options forfeited (191) 7.44 Less options exercised (112) 1.14 Options outstanding at September 30, 2016 689 $ 6.19 7.55 $ 174 Options exercisable at September 30, 2016 347 $ 6.09 6.09 $ 174 There were 40,000 and 172,000 stock options granted during the three months ended September 30, 2016 and 2015, respectively. The weighted-average grant-date fair value of stock options granted were $1.16 and $0.96 during the three months ended September 30, 2016 and 2015, respectively. As of September 30, 2016, there were approximately $ 0.5 million of total unrecognized compensation costs related to unvested stock options. These costs are expected to be recognized over a weighted average period of 2.72 years. The total fair value of stock options vested during the three months ended September 30, 2016 and 2015 was approximately $0.1 million, respectively. The total fair value of stock options vested during the nine months ended September 30, 2016 and 2015 was approximately $ 0.2 million and $ 0.3 million, respectively. The deferred income tax benefits from stock option expense related to Evolving Systems U.K. totaled approximately $ 3,000 and $5,000 for the three months ended September 30, 2016 and 2015, respectively. The deferred income tax benefits from stock option expense related to Evolving Systems U.K. totaled approximately $ 10,000 and $ 14,000 for the nine months ended September 30, 2016 and 2015, respectively. Cash received from stock option exercises for the three months ended September 30, 2016 and 2015 was $ 9,000 and $ 0 , respectively. Cash received from stock option exercises for the nine months ended September 30, 2016 and 2015 was $ 50,000 and $27,000 , respectively. During the three months ended September 30, 2016, we had net settlement exercises of stock options, whereby the optionee did not pay cash for the options but instead received the number of shares equal to the difference between the exercise price and the market price on the date of exercise. Net settlement exercises during the three months ended September 30, 2016, resulted in approximately 93,782 shares issued and 32,502 options cancelled in settlement of shares issued. There were no net settlement exercises during the three or nine months ended September 30, 2015. Employee Stock Purchase Plan Under the Employee Stock Purchase Plan (“ESPP”), we are authorized to issue up to 550,000 shares. Employees may elect to have up to 15 % of their gross compensation withheld through payroll deductions to purchase our common stock, capped at $ 25,000 annually and no more than 10,000 shares per offering period. The purchase price of the stock is 85 % of the lower of the market price at the beginning or end of each three-month participation period. As of September 30, 2016, there were approximately 51,000 shares available for purchase. For the three months ended September 30, 2016 and 2015, we recorded compensation expense of $ 160 and $3,000 , respectively, and $ 2,000 and $ 11,000 , for the nine months ended September 30, 2016 and 2015, respectively, associated with grants under the ESPP which includes the fair value of the look-back feature of each grant as well as the 15 % discount on the purchase price. This expense fluctuates each period primarily based on the level of employee participation. The fair value of each purchase made under our ESPP is estimated on the date of purchase using the Black-Scholes model. The Black-Scholes model uses four assumptions to calculate the fair value of each purchase. The expected term of each purchase is based upon the three-month participation period of each offering. The risk-free interest rate is based upon the rate currently available on zero-coupon U.S. Treasury instruments with a remaining term equal to the expected term of each offering. The expected volatility is based upon historical volatility of our common stock. The expected dividend yield is based upon historical and anticipated payment of dividends. The weighted average assumptions used in the fair value calculations are as follows: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Expected term (years) 0.25 0.25 0.25 0.25 Risk-free interest rate 0.27 % 0.01 % 0.23 % 0.03 % Expected volatility 40.28 % 41.51 % 41.56 % 38.20 % Expected dividend yield 5.06 % 7.33 % 7.58 % 5.77 % Cash received from employee stock plan purchases for the three months ended September 30, 2016 and 2015 was $ 1,000 and $11,000 , respectively. Cash received from employee stock plan purchases for the nine months ended September 30, 2016 and 2015 was $6,000 and $ 44,000 , respectively. We issued shares related to the ESPP of approximately 200 and 2,000 for the three months ended September 30, 2016 and 2015, respectively. We issued shares related to the ESPP of approximately 1,000 and 7,000 for the nine months ended September 30, 2016 and 2015, respectively. |
Concentration Of Credit Risk
Concentration Of Credit Risk | 9 Months Ended |
Sep. 30, 2016 | |
Concentration Of Credit Risk [Abstract] | |
Concentration Of Credit Risk | NOTE 6 — CONCENTRATION OF CREDIT RISK For the three months ended September 30, 2016, one significant customer (defined as contributing at least 10 %) accounted for 13 % of revenue from operations. The significant customer for the three months ended September 30, 2016 is a large telecommunications operator in Africa. For the three months ended September 30, 2015, no significant customers accounted for 10% of revenue from operations. For the nine months ended September 30, 2016 and 2015, no significant customers accounted for 10% of revenue from operations. As of September 30, 2016, one significant customer accounted for approximately 14 % of contract receivables and unbilled work-in-progress. This customer is a large telecommunication operator in Africa. As of December 31, 2015, two significant customers accounted for approximately 36% ( 25% and 11% ) of contract receivables and unbilled work-in-progress. These customers are large telecommunications operators in Africa and Europe. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2016 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | NOTE 7 — LONG-TERM DEBT On February 29, 2016, we entered into the Fifth Amendment to the Loan and Security Agreement with East West Bank which provides for a Term Loan (the “Term Loan”) for $6.0 million. The $6.0 million loan bears interest at a floating rate equal to the U.S.A. Prime Rate plus 1.0% . The Term Loan is secured by substantially all of the assets of Evolving Systems, including a pledge, subject to certain limitations with respect to stock of foreign subsidiaries, of the stock of the existing and future direct subsidiaries of Evolving Systems. Interest shall accrue from the date the Term Loan is made at the aforementioned rate and shall be payable monthly. The Term Loan shall be repaid in 36 equal monthly installments of principal, plus accrued but unpaid interest, commencing on January 1, 2017 and continuing on the first day of each month thereafter through and including January 1, 2020 . On the Term Loan maturity date, the outstanding principal amount of the Term Loan and all accrued and unpaid interest thereon shall be immediately due and payable. The Term Loan, once repaid, may not be reborrowed. We must maintain a minimum current ratio, a specified ratio of Total Liabilities to EBITDA and a minimum fixed charge coverage ratio which are as defined in the Term Loan. The Term Loan requires us to pay two annual credit facility fees of $18,750 and legal fee equal to $1,000 . The Term Loan agreement required us to use the term loan’s proceeds and $4.0 million from our cash balances to pay off and terminate the Revolving Facilities totaling $10.0 million. The Term Loan matures on January 1, 2020. As of September 30, 2016, we are in compliance with the covenants and have a $6.0 million balance under the Term Loan net of approximately $ 8,000 debt issuance costs. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Taxes [Abstract] | |
Income Taxes | NOTE 8 — INCOME TAXES We recorded net income tax expense of $ 0.4 million and $0.1 million for the three months ended September 30, 2016 and 2015, respectively. The net expense during the three months ended September 30, 2016 consisted of current income tax expense of $ 0.3 million and a deferred tax expense of $0.1 million. The current tax expense consists of income tax from our U.S., U.K. and India based operations. The deferred tax expense primarily related to undistributed U.K. foreign earnings offset by the amortization of intangible assets related to the acquisition of Evolving Systems NC, Inc. in September 2015. The net expense during the three months ended September 30, 2015 consisted of current income tax expense of $0.1 million. The current tax expense consists of income tax from our U.K. and India based operations and unrecoverable foreign withholding taxes in the U.K. We recorded net income tax expense of $0.9 million for the nine months ended September 30, 2016 and 2015. The net expense during the nine months ended September 30, 2016 consisted of current income tax expense of $0.9 million and a deferred tax benefit of ( $ 19,000 ). The current tax expense consists primarily of income tax from our U.K. and India based operations. The deferred tax benefit was primarily related to the amortization of intangible assets related to the acquisition of Evolving Systems NC, Inc. in September 2015 offset by undistributed U.K. foreign earnings. The net expense during the nine months ended September 30, 2015 consisted of current income tax expense of $0.9 and a deferred tax benefit of ( $25,000 ). The current tax expense consists primarily of income tax from our U.K. and India based operations, and unrecoverable foreign withholding taxes in the U.K. The deferred tax benefit was primarily related to the increase of certain deferred tax assets in the U.K. and India. Our effective tax rate was 31% and 20% for the three months ended September 30, 2016 and 2015, respectively. The increase in our effective tax rate during 2016 relates to lower estimated research and development tax credits generated in the U.K. in 2016 and an adjustment in 2015 to our annual effective tax rate for earnings which were lower than projected. Our effective tax rate was 30% and 29% for the nine months ended September 30, 2016 and 2015, respectively. The increase in our effective tax rate relates to a lower estimated research and development tax credit being generated in the U.K. during 2016. As of September 30, 2016 and December 31, 2015 we continued to maintain a valuation allowance on portions of our domestic net deferred tax asset. Such assets primarily consist of Foreign Tax credit carry forwards (“FTC”), certain state Net Operating Loss (“NOL”) carryforwards, research and development tax credits and Alternative Minimum Tax (“AMT”) credits. Our deferred tax assets and liabilities as of September 30, 2016, were comprised of the following (in thousands): September 30, 2016 Deferred tax assets Foreign tax credits carryforwards $ 4,518 Net operating loss carryforwards 1,024 Research & development credits 303 AMT credits 770 Stock compensation 587 Depreciable assets 105 Accrued liabilities and reserves 232 Total deferred tax assets 7,539 Deferred tax liabilities Deferred revenue Undistributed foreign earnings $ (1,140) Intangibles (1,330) Total deferred tax liability (2,470) Net deferred tax assets, before valuation allowance $ 5,069 Valuation allowance (5,069) Net deferred tax asset $ - In our U.S. Federal income tax returns we historically deducted income taxes paid to various countries. In our 2014 U.S. Federal income tax return we had $2.3 million of NOL carryforwards. Our income tax calculations have historically been under the regular and AMT regulations found in U.S. tax laws. The U.S. tax system contains rules to alleviate the burden of double taxation on income generated in foreign countries and subject to tax in such countries. The U.S. allows for either a deduction or credit of such foreign taxes against U.S. taxable income. An election to either claim a deduction or credit on such foreign income taxes can be made each tax year, independent from elections made in other years. A credit reduces a company’s actual U.S. income tax on a dollar-for-dollar basis, while a deduction reduces only the company’s income subject to tax. We made a comparison of our foreign dividends paid by our foreign subsidiary for which we deducted foreign taxes claimed versus claiming a Foreign Tax Credit (“FTC”) on the dividend paid by the foreign subsidiary. The dividends received were grossed-up with its corresponding foreign taxes. The U.S. law requires the offset of taxable income with NOL prior to applying the FTC rules. We determined it was beneficial for the company to gross-up the foreign dividends paid by the foreign subsidiary for the years 2012 through 2014 and make the election to claim a FTC. By doing so we fully utilized our December 31, 2014, $2.3 million balance of the federal NOL. A similar comparison of benefits to either claim a deduction or a foreign tax credit for allowable foreign taxes has been made as of September 30, 2016. As the election to claim the foreign tax credit or deduction is made on an annual basis, the Company intends to compare benefits to either claim a deduction or foreign tax credit on a quarterly basis. As a result, the company has approximately $ 4.5 million of FTC’s to carryforward through 2016 and subsequent years as a deferred tax asset. Section 382 of the Internal Revenue Code imposes an annual limitation on the amount of certain tax attributes, including net operating loss and tax credit carryovers, available to be utilized following an "Ownership Change" triggered by a shift of greater than 50% in stock ownership over a three year testing period. We believe SSM likely may have had Ownership Changes prior to its acquisition by Evolving Systems, Inc. However, the amount of the applicable limitation is not known, and cannot be estimated at this time. Accordingly, the Company has not recorded a deferred tax asset associated with SSM's tax attributes in its initial purchase accounting. The Company intends to review the ownership history of SSM to determine the utilizable portion of its tax attributes as soon as practicable, and if appropriate, adjust the deferred tax assets and purchase accounting upon the conclusion of its assessment. As of September 30, 2016 and December 31, 2015 we had no liability for unrecognized tax benefits. We conduct business globally and, as a result, Evolving Systems, Inc. or one or more of our subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. Throughout the world, in the normal course of business, we are subject to examination by taxing authorities up until, two years in the U.K. and four years in India, following the end of the accounting period. As of the date of this report, none of our income tax returns are under examination. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2016 | |
Stockholders' Equity [Abstract] | |
Stockholders' Equity | NOTE 9 — STOCKHOLDERS’ EQUITY Common Stock Dividend On May 3, 2016 , our Board of Directors declared a second quarter cash dividend of $0.11 per share, which was paid July 1, 2016 , to stockholders of record June 3, 2016 . Previously, our Board of Directors declared a first quarter cash dividend of $0.11 per share on March 15, 2016 , which was paid April 1, 2016 , to stockholders of record M arch 28, 2016 . Any determination to declare a future quarterly dividend, as well as the amount of any cash dividend which may be declared, will be based on our financial position, earnings, financial covenants to which we are subject, earnings outlook and other relevant factors at that time. Certain Anti-Takeover Provisions/Agreements with Stockholders Our restated certificate of incorporation allows the board of directors to issue up to 2,000,000 shares of preferred stock and to determine the price, rights, preferences and privileges of those shares without any further vote or action by our stockholders. The rights of the holders of our common stock will be subject to, and may be adversely affected by, the rights of the holders of any preferred stock that may be issued in the future. Issuance of preferred stock, while providing desired flexibility in connection with possible acquisitions and other corporate purposes, could make it more difficult for a third party to acquire a majority of our outstanding voting stock. As of September 30, 2016 and December 31, 2015, no shares of preferred stock were outstanding. In addition, we are subject to the anti-takeover provisions of Section 203 of Delaware General Corporation Law which prohibit us from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in the prescribed manner. The application of Section 203 may have the effect of delaying or preventing changes in control of our management, which could adversely affect the market price of our common stock by discouraging or preventing takeover attempts that might result in the payment of a premium price to our stockholders. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2016 | |
Segment Information [Abstract] | |
Segment Information | NOTE 10 — SEGMENT INFORMATION We define operating segments as components of our enterprise for which separate financial information is reviewed regularly by the chief operating decision-makers to evaluate performance and to make operating decisions. We have identified our Chief Executive Officer and Chief Financial Officer as our chief operating decision-makers (“CODM”). These chief operating decision makers review revenues by segment and review overall results of operations. We currently operate our business as two operating segments based on revenue type: license fees and services revenue, and customer support revenue (as shown on the consolidated statements of operations). License fees and services (“L&S”) revenue represents the fees received from the license of software products and those services directly related to the delivery of the licensed products, such as fees for custom development and integration services and managed services. Customer support (“CS”) revenue includes annual support fees, recurring maintenance fees, fees for maintenance upgrades and warranty services. Warranty services that are similar to software maintenance services are typically bundled with a license sale. Total assets by segment have not been disclosed as the information is not available to the chief operating decision-makers. Segment information is as follows (in thousands): For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Revenue License fees and services $ 3,557 $ 3,228 $ 10,616 $ 11,177 Customer support 2,546 2,545 8,045 7,327 Total revenue 6,103 5,773 18,661 18,504 Revenue less costs of revenue, excluding depreciation and amortization License fees and services 2,596 2,185 7,648 7,719 Customer support 2,248 2,149 7,042 6,211 4,844 4,334 14,690 13,930 Unallocated Costs Other operating expenses 2,885 3,259 9,066 10,265 Depreciation and amortization 253 121 792 348 Restructuring 3 - 1,007 - Interest income (1) (5) (4) (14) Interest expense 74 3 265 9 Foreign currency exchange (gain) loss 261 244 508 218 Income from operations before income taxes $ 1,369 $ 712 $ 3,056 $ 3,104 Geographic Regions We are headquartered in Englewood, a suburb of Denver, Colorado. We use customer locations as the basis for attributing revenues to individual countries. We provide products and services on a global basis through our headquarters, our London-based Evolving Systems U.K. subsidiary and our North Carolina based Evolving Systems NC, Inc. subsidiary. Additionally, personnel in Bangalore and Kolkata, India provide software development and support services to our global operations. Financial information relating to operations by geographic region is as follows (in thousands): For the Three Months Ended September 30, 2016 Revenue L&S CS Total Algeria $ 867 $ - $ 867 United Kingdom 352 370 722 Switzerland 505 181 686 Other 1,833 1,995 3,828 Total revenues $ 3,557 $ 2,546 $ 6,103 For the Three Months Ended September 30, 2015 Revenue L&S CS Total United Kingdom $ 638 $ 429 $ 1,067 Indonesia 488 103 591 Other 2,102 2,013 4,115 Total revenues $ 3,228 $ 2,545 $ 5,773 For the Nine Months Ended September 30, 2016 Revenue L&S CS Total United Kingdom $ 1,447 $ 1,175 $ 2,622 Switzerland 1,570 539 2,109 Other 7,599 6,331 13,930 Total revenues $ 10,616 $ 8,045 $ 18,661 For the Nine Months Ended September 30, 2015 Revenue L&S CS Total United Kingdom $ 1,599 $ 1,344 $ 2,943 Other 9,578 5,983 15,561 Total revenues $ 11,177 $ 7,327 $ 18,504 September 30, December 31, Long-lived assets, net 2016 2015 United States $ 12,356 $ 13,026 United Kingdom 13,366 15,318 Other 302 341 $ 26,024 $ 28,685 |
Commitments And Contingencies
Commitments And Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments And Contingencies [Abstract] | |
Commitments And Contingencies | NOTE 11 — COMMITMENTS AND CONTINGENCIES (a) Other Commitments As permitted under Delaware law, we have agreements with officers and directors under which we agree to indemnify them for certain events or occurrences while the officer or director is, or was, serving at our request in this capacity. The term of the indemnification period is indefinite. There is no limit on the amount of future payments we could be required to make under these indemnification agreements; however, we maintain Director and Officer insurance policies, as well as an Employment Practices Liability Insurance Policy, that may enable us to recover a portion of any amounts paid. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal. Accordingly, there were no liabilities recorded for these agreements as of September 30, 2016 or December 31, 2015. We enter into standard indemnification terms with customers and suppliers, in the ordinary course of business, for third party claims arising under our contracts. In addition, as we may subcontract the development of deliverables under customer contracts, we could be required to indemnify customers for work performed by subcontractors. Depending upon the nature of the indemnification, the potential amount of future payments we could be required to make under these indemnification agreements may be unlimited. We may be able to recover damages from a subcontractor or other supplier if the indemnification results from the subcontractor’s or supplier’s failure to perform. To the extent we are unable to recover damages from a subcontractor or other supplier, we could be required to reimburse the indemnified party for the full amount. We have never incurred costs to defend lawsuits or settle claims relating to an indemnification. As a result, we believe the estimated fair value of these agreements is minimal. Accordingly, there were no liabilities recorded for these agreements as of September 30, 2016 or December 31, 2015. Our standard license agreements contain product warranties that the software will be free of material defects and will operate in accordance with the stated requirements for a limited period of time. The product warranty provisions require us to cure any defects through any reasonable means. We believe the estimated fair value of the product warranty provisions in the license agreements in place with our customers is minimal. Accordingly, there were no liabilities recorded for these product warranty provisions as of September 30, 2016 or December 31, 2015. Our software arrangements generally include a product indemnification provision whereby we will indemnify and defend a customer in actions brought against the customer for claims that our products infringe upon a copyright, trade secret, or valid patent of a third party. We have not historically incurred any significant costs related to product indemnification claims. Accordingly, there were no liabilities recorded for these indemnification provisions as of September 30, 2016 or December 31, 2015. In connection with our acquisition of Telespree on October 24, 2013 , we agreed to make a cash payment of $0.5 million on the one year anniversary of the closing. This payment was subject to reduction for certain claims and has not been paid to date. We have made claims against this payment which are currently under dispute. Once settled the final payment will be released. (b) Litigation From time to time, we are involved in various legal matters arising in the normal course of business. We do not expect the outcome of such proceedings, either individually or in the aggregate, to have a material effect on our financial position, cash flows or results of operations. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2016 | |
Restructuring [Abstract] | |
Restructuring | NOTE 12 – RESTRUCTURING During the first, second and third quarters of 2016, we undertook a reduction in workforce involving the termination of employees resulting in an expense of $0.9 million, $0.1 million and $3,000 , respectively, primarily related to severance for the affected employees. The reduction in workforce was related to the consolidations of duplicative functions and alignment of staff with ongoing business activity as a result of the acquisition of Evolving Systems NC, Inc. in the third quarter of 2015. There was no restructuring expense for the three or nine months ended September 30, 2015. In October 2015, we undertook a reduction in workforce involving the termination of employees resulting in an expense of approximately $0.5 million primarily related to severance for the affected employees. The reduction in workforce was related to the consolidations of duplicative functions and alignment of staff with ongoing business activity as a result of the acquisition of Evolving Systems NC, Inc. in the third quarter of 2015. The restructuring liability was approximately $ 0 .1 million and $25,000 as of September 30, 2016 and December 31, 2015, respectively. |
Basis Of Presentation (Policy)
Basis Of Presentation (Policy) | 9 Months Ended |
Sep. 30, 2016 | |
Basis Of Presentation [Abstract] | |
Organization | Organization — We are a provider of software solutions and services to the wireless, wireline and cable markets. We maintain long-standing relationships with many of the largest wireless, wireline and cable companies worldwide. Our customers rely on us to develop, deploy, enhance and maintain software solutions that provide a variety of service activation and provisioning functions. Our service activation solution, Tertio ® (“TSA”) is used to activate bundles of voice, video and data services for wireless, wireline and cable network operators; our SIM card activation solution, Dynamic SIM Allocation TM (“DSA”) is used to dynamically allocate and assign resources to Mobile Network Operators (“MNOs”) devices that rely on SIM cards; our Mobile Data Enablement TM (“MDE”) solution provides a data consumption and policy management solution for wireless carriers and Mobile Virtual Network Operators (“MVNOs”) that monitor the usage and consumption of data services; our Total Number Management™ (“TNM”) product is a scalable and fully automated database solution that enables operators to reliably and efficiently manage their telephone numbers as well as other communication identifiers (i.e. SIMs, MSISDNs, IMSIs, ICCIDs, IPs). Our solutions can be deployed on premise or offered as a Software-as-a-Service (“SaaS”). On September 30, 2015 we announced the acquisition of privately held RateIntegration, Inc., d/b/a Sixth Sense Media (“SSM”), a provider of real time analytics and marketing solutions to wireless carriers. SSM’s software solution platform, Real-time Lifecycle Marketing ™ (“RLM”), enables carriers’ marketing departments to innovate, execute and manage highly-personalized and contextually-relevant, interactive campaigns that engage consumers in real time. We believe the addition of SSM’s RLM product to our existing service activation and data enablement products will produce a powerful platform for wireless carriers. A product suite which we refer to as our Mobile Marketing Solutions (“MMS”) will provide sophisticated, highly tailored mobile campaigns which can be executed based on critical subscriber data captured during the initial activation experience (DSA and RLM) as well as in-life subscriber usage via MDE. We see the opportunity to leverage our technology to provide MNOs with sophisticated mobile marketing campaigns that will extend beyond voice, text and data usage campaigns and provide marketing services that will assist MNOs to market services that include retail mobile marketing, gaming, streaming video as well as social media based campaigns. |
Interim Consolidated Financial Statements | Interim Consolidated Financial Statements — The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and in conformity with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X and the related rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures included in these financial statements are adequate to make the information presented not misleading. The unaudited condensed consolidated financial statements included in this document have been prepared on the same basis as the annual consolidated financial statements, and in our opinion reflect all adjustments, which include normal recurring adjustments necessary for a fair presentation in accordance with GAAP and SEC regulations for interim financial statements. The results for the three and nine months ended September 30, 2016 are not necessarily indicative of the results that we will have for any subsequent period. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to those statements for the year ended December 31, 2015 included in our Annual Report on Form 10-K. |
Reclassifications | Reclassifications - Certain reclassifications have been made to the 2015 financial statements to conform to the consolidated 2016 financial statement presentation. These reclassifications had no effect on net earnings or cash flows as previously reported. |
Use Of Estimates | Use of Estimates — The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities, at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. We made estimates with respect to revenue recognition for estimated hours to complete projects accounted for using the percentage-of-completion method, allowance for doubtful accounts, income tax valuation allowance, fair values of long-lived assets, valuation of intangible assets and goodwill, useful lives for property, equipment and intangible assets, business combinations, capitalization of internal software development costs and fair value of stock-based compensation amounts. Actual results could differ from these estimates. |
Foreign Currency | Foreign Currency — Our functional currency is the U.S. dollar. The functional currency of our foreign operations is the respective local currency for each foreign subsidiary. Assets and liabilities of foreign operations denominated in local currencies are translated at the spot rate in effect at the applicable reporting date. Our consolidated statements of income are translated at the weighted average rate of exchange during the applicable period. The resulting unrealized cumulative translation adjustment is recorded as a component of accumulated other comprehensive loss in stockholders’ equity. Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional currency of the applicable entity are recorded in other income (expense) in the consolidated statements of operations in the period in which they occur. |
Principles Of Consolidation | Principles of Consolidation — The unaudited condensed consolidated financial statements include the accounts of Evolving Systems, Inc. and subsidiaries, all of which are wholly owned. All significant intercompany transactions and balances have been eliminated in consolidation. |
Goodwill | Goodwill — Goodwill is the excess of acquisition cost of an acquired entity over the fair value of the identifiable net assets acquired. Goodwill is not amortized, but tested for impairment annually or whenever indicators of impairment exist. These indicators may include a significant change in the business climate, legal factors, operating performance indicators, competition, sale or disposition of a significant portion of the business or other factors. Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. |
Intangible Assets | Intangible Assets — Amortizable intangible assets consist primarily of purchased software and licenses, customer contracts and relationships, trademarks and tradenames, non-competition and business partnerships acquired in conjunction with our purchase of Telespree Communications (“Evolving Systems Labs, Inc.”) and RateIntegration, Inc. d/b/a Sixth Sense Media (“Evolving Systems NC, Inc.”). These assets are amortized using the straight-line method over their estimated lives. We assess the impairment of identifiable intangibles if events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. If we determine that the carrying value of intangibles and/or long-lived assets may not be recoverable, we compare the estimated undiscounted cash flows expected to result from the use of the asset and its eventual disposition to the asset’s carrying amount. If an amortizable intangible or long-lived asset is not deemed to be recoverable, we recognize an impairment loss representing the excess of the asset’s carrying value over its estimated fair value. |
Fair Value Measurements | Fair Value Measurements — Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. |
Cash And Cash Equivalents | Cash and Cash Equivalents — All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents. |
Revenue Recognition | Revenue Recognition — We recognize revenue when an agreement is signed, the fee is fixed or determinable and collectability is reasonably assured. We recognize revenue from two primary sources: license fees and services, and customer support. The majority of our license fees and services revenue is generated from fixed-price contracts, which provide for licenses to our software products and services to customize such software to meet our customers’ use and managed services which leverages our expertise and software solutions to optimize our customers networks and create new revenue streams. When the customization services are determined to be essential to the functionality of the delivered software, we recognize revenue using the percentage-of-completion method of accounting. In these types of arrangements, we do not typically have Vendor Specific Objective Evidence (“VSOE”) of fair value on the license fee/services portion (services are related to customizing the software) of the arrangement due to the large amount of customization required by our customers; however, we do have VSOE for the warranty/maintenance services based on the renewal rate of the first year of maintenance in the arrangement. The license/services portion is recognized using the percentage-of-completion method of accounting, managed services is recognized as services are performed or ratably over the contract period and the warranty/maintenance services are separated based on the renewal rate in the contract and recognized ratably over the warranty or maintenance period. We estimate the percentage-of-completion for each contract based on the ratio of direct labor hours incurred to total estimated direct labor hours and recognize revenue based on the percent complete multiplied by the contract amount allocated to the license fee/services. Since estimated direct labor hours, and changes thereto, can have a significant impact on revenue recognition, these estimates are critical and we review them regularly. If the arrangement includes a customer acceptance provision, the hours to complete the acceptance testing are included in the total estimated direct labor hours; therefore, the related revenue is recognized as the acceptance testing is performed. Revenue is not recognized in full until the customer has provided proof of acceptance on the arrangement. Generally, our contracts are accounted for individually. However, when certain criteria are met, it may be necessary to account for two or more contracts as one to reflect the substance of the group of contracts. We record amounts billed in advance of services being performed as unearned revenue. Unbilled work-in-progress represents revenue earned but not yet billable under the terms of the fixed-price contracts. All such amounts are expected to be billed and collected within 12 months. We may encounter budget and schedule changes or increases on fixed-price contracts caused by increased labor or overhead costs. We make adjustments to cost estimates in the period in which the facts requiring such revisions become known. We record estimated losses, if any, in the period in which current estimates of total contract revenue and contract costs indicate a loss. If revisions to cost estimates are obtained after the balance sheet date but before the issuance of the interim or annual financial statements, we make adjustments to the interim or annual financial statements accordingly. In arrangements where the services are not essential to the functionality of the delivered software, we recognize license revenue when a license agreement has been signed, delivery and acceptance have occurred, the fee is fixed or determinable and collectability is reasonably assured. Where applicable, we unbundle and record as revenue fees from multiple element arrangements as the elements are delivered to the extent that VSOE of fair value of the undelivered elements exist. If VSOE for the undelivered elements does not exist, we defer fees from such arrangements until the earlier of the date that VSOE does exist on the undelivered elements or all of the elements have been delivered. We recognize revenue from fixed-price service contracts using the proportional performance method of accounting, which is similar to the percentage-of-completion method described above. We recognize revenue from professional services provided pursuant to time-and-materials based contracts and training services as the services are performed, as that is when our obligation to our customers under such arrangements is fulfilled. We recognize revenue from managed service as services are performed or ratably based on the terms and conditions of the contract. We recognize revenue from our MDE contracts based on the number of transactions per month multiplied by a factor based on a unique table for transaction volumes relating to each account. We recognize customer support, including maintenance revenue, ratably over the service contract period. When maintenance is bundled with the original license fee arrangement, its fair value, based upon VSOE, is deferred and recognized during the periods when services are provided. We review and update our contract-related estimates regularly. We recognize adjustments in estimated profit on contracts under the reallocation method. Under the reallocation method, the impact of an adjustment in estimate is recognized prospectively over the remaining contract term. No adjustment on any one contract was material to our unaudited Consolidated Financial Statements in the three and nine months ended September 30, 2016 and 2015. |
Stock-Based Compensation | Stock-based Compensation — We account for stock-based compensation by applying a fair-value-based measurement method to account for share-based payment transactions with employees and directors. We record compensation costs associated with the vesting of unvested options on a straight-line basis over the vesting period. Stock-based compensation is a non-cash expense because we settle these obligations by issuing shares of our common stock instead of settling such obligations with cash payments. We use the Black-Scholes model to estimate the fair value of each option grant on the date of grant. This model requires the use of estimates for expected term of the options and expected volatility of the price of our common stock. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) — Comprehensive income (loss) consists of two components, net income and other comprehensive income (loss). Other comprehensive income (loss) refers to revenue, expenses, gains, and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net income. Other comprehensive income (loss) consists of foreign currency translation adjustments from those subsidiaries not using the U.S. dollar as their functional currency. |
Income Taxes | Income Taxes — We record deferred tax assets and liabilities for the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the accompanying condensed consolidated balance sheets, as well as operating losses and tax credit carry-forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to be applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. We reduce deferred tax assets by a valuation allowance if, based on available evidence, it is more likely than not that these benefits will not be realized. We use a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers,” Topic 606. This Update affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards. The guidance in this Update supersedes the revenue recognition requirements in Topic 605, Revenue Recognition and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to illustrate the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance also includes a cohesive set of dis closure requirements that will pro vide users of financial statements with comprehensive information about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a report ing organization’s contracts with customers. In April 2016, the FASB issued ASU No. 2016-10, “Revenue from Contracts with Customers,” Topic 606: “Identifying Performance Obligations and Licensing”. This Update clarifies guidance related to identifying performance obligations and licensing implementation guidance contained in the new revenue recognition standard. The Update includes targeted improvements based on input the Board received from the Transition Resource Group for Revenue Recognition and other stakeholders. The update seeks to proactively address areas in which diversity in practice potentially could arise, as well as to reduce the cost and complexity of applying certain aspects of the guidance both at implementation and on an ongoing basis. In May 2016, the FASB issued ASU No. 2016-12, “Revenue from Contracts with Customers,” Topic 606: “Narrow-Scope Improvements and Practical Expedients”. The amendments in this Update address narrow-scope improvements to the guidance on collectibility, noncash consideration, and completed contracts at transition. Additionally, the amendments in this Update provide a practical expedient for contract modifications at transition and an accounting policy election related to the presentation of sales taxes and other similar taxes collected from customers. This ASU is the final version of Proposed Accounting Standards Update 2015-320, “Revenue from Contracts with Customers,” (Topic 606): “Narrow-Scope Improvements and Practical Expedients,” which has been deleted. This ASU is effective retrospectively for fiscal years, and interim periods within those years beginning after December 15, 2017 for public companies and 2018 for non-public entities. We do not expect the adoption of this standard to have a significant impact on the Company’s financial position and results of operations. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which requires lessees to put most leases on their balance sheets by recognizing a lessee’s rights and obligations, while expenses will continue to be recognized in a similar manner to today’s legacy lease accounting guidance. This ASU could also significantly affect the financial ratios used for external reporting and other purposes, such as debt covenant compliance. This ASU will be effective for us on January 1, 2019, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718), which includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The standard is effective for annual periods beginning after December 15, 2016, with early adoption permitted. We are currently in the process of assessing the impact of this ASU on our consolidated financial statements. |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Acquisition [Abstract] | |
Summary Of Total Purchase Price | September 30, 2015 Cash Consideration Initial Cash Purchase Price $ 9,750 Cash/Working Capital Adjustment 535 Total Cash Consideration $ 10,285 Assumed Liabilities 250 Total purchase price $ 10,535 |
Schedule Of Assets Acquired and Liabilities Assumed At Acquisition Date | September 30, 2015 Cash and cash equivalents $ 1,521 Contract receivables 1,057 Unbilled work-in-progress 89 Intangible assets 4,642 Prepaid and other current assets 68 Other assets, non-current 32 Total identifiable assets acquired $ 7,409 Accounts payable and accrued liabilities $ 1,506 Deferred tax liability 1,760 Deferred revenue 557 Total identifiable liabilities acquired $ 3,823 Net identifiable assets acquired 3,586 Goodwill 6,949 Net assets acquired $ 10,535 |
Intangible Assets Related To Acquisition | September 30, 2016 Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 1,679 $ 210 $ 1,469 8 yrs Trademarks and tradenames 122 61 61 2 yrs Non-competition 33 17 16 2 yrs Customer relationships 2,808 401 2,407 7 yrs $ 4,642 $ 689 $ 3,953 7.19 yrs |
Schedule Of Pro Forma Information | For the Nine Months Ended September 30, 2016 – Actual 2015 – Pro-forma Revenue $ 18,661 $ 23,118 Net Income 2,148 2,559 |
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill And Intangible Assets [Abstract] | |
Summary Of Changes In Carrying Amount Of Goodwill | License and Services Customer Support Total U.S. India U.K. U.S. U.K. Goodwill Balance as of December 31, 2015 $ 6,281 $ 184 $ 6,767 $ 1,549 $ 8,361 $ 23,142 Effects of changes in foreign currency exchange rates (1) - (2) (837) - (1,034) (1,873) Balance at September 30, 2016 $ 6,281 $ 182 $ 5,930 $ 1,549 $ 7,327 $ 21,269 (1) Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. |
Summary Of Identifiable Intangible Assets | September 30, 2016 December 31, 2015 Gross Amount Accumulated Amortization Net Carrying Amount Gross Amount Accumulated Amortization Net Carrying Amount Weighted-Average Amortization Period Purchased software $ 2,118 $ 370 $ 1,748 $ 2,118 $ 171 $ 1,947 7.3 yrs Trademarks and tradenames 185 98 87 185 43 142 2.6 yrs Non-competition 33 16 17 33 4 29 2.0 yrs Customer relationships 3,024 480 2,544 3,024 159 2,865 6.8 yrs $ 5,360 $ 964 $ 4,396 $ 5,360 $ 377 $ 4,983 6.8 yrs |
Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles | Twelve months ending September 30, 2017 $ 783 2018 705 2019 694 2020 693 2021 693 Thereafter 828 $ 4,396 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Common Share [Abstract] | |
Summary Of Basic And Diluted Earnings Per Share | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Basic income per share: Net income available to common stockholders $ 941 $ 570 $ 2,148 $ 2,210 Basic weighted average shares outstanding 11,873 11,687 11,824 11,677 Basic income per share: $ 0.08 $ 0.05 $ 0.18 $ 0.19 Diluted income per share: Net income available to common stockholders $ 941 $ 570 $ 2,148 $ 2,210 Weighted average shares outstanding 11,873 11,687 11,824 11,677 Effect of dilutive securities - options 106 240 143 261 Diluted weighted average shares outstanding 11,979 11,927 11,967 11,938 Diluted income per share: $ 0.08 $ 0.05 $ 0.18 $ 0.19 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary Of Stock-Based Compensation Expenses | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Cost of license fees and services, excluding depreciation and amortization $ 7 $ 17 $ 27 $ 56 Cost of customer support, excluding depreciation and amortization 1 3 5 8 Sales and marketing 7 10 20 26 General and administrative 20 23 90 76 Product development 17 16 56 63 Total share based compensation $ 52 $ 69 $ 198 $ 229 |
Summary Of Stock Option Activity | Weighted- Average Weighted- Remaining Aggregate Number of Average Contractual Intrinsic Shares Exercise Term Value (in thousands) Price (Years) (in thousands) Options outstanding at December 31, 2015 834 $ 5.97 6.94 $ 957 Options granted 158 5.31 Less options forfeited (191) 7.44 Less options exercised (112) 1.14 Options outstanding at September 30, 2016 689 $ 6.19 7.55 $ 174 Options exercisable at September 30, 2016 347 $ 6.09 6.09 $ 174 |
Stock Incentive Plans [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Assumptions For Weighted Average Fair Value Of Stock Options | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Expected term (years) 6.0 6.0 6.0 6.0 Risk-free interest rate 1.10 % 1.37 % 1.32 % 1.37 % Expected volatility 36.55 % 37.76 % 36.81 % 42.47 % Expected dividend yield 4.23 % 7.33 % 7.22 % 6.32 % |
Employee Stock Purchase Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Assumptions For Weighted Average Fair Value Of Stock Options | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Expected term (years) 0.25 0.25 0.25 0.25 Risk-free interest rate 0.27 % 0.01 % 0.23 % 0.03 % Expected volatility 40.28 % 41.51 % 41.56 % 38.20 % Expected dividend yield 5.06 % 7.33 % 7.58 % 5.77 % |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Income Taxes [Abstract] | |
Components Of Deferred Tax Assets And Liabilities | September 30, 2016 Deferred tax assets Foreign tax credits carryforwards $ 4,518 Net operating loss carryforwards 1,024 Research & development credits 303 AMT credits 770 Stock compensation 587 Depreciable assets 105 Accrued liabilities and reserves 232 Total deferred tax assets 7,539 Deferred tax liabilities Deferred revenue Undistributed foreign earnings $ (1,140) Intangibles (1,330) Total deferred tax liability (2,470) Net deferred tax assets, before valuation allowance $ 5,069 Valuation allowance (5,069) Net deferred tax asset $ - |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Information [Abstract] | |
Segment Information | For the Three Months Ended September 30, For the Nine Months Ended September 30, 2016 2015 2016 2015 Revenue License fees and services $ 3,557 $ 3,228 $ 10,616 $ 11,177 Customer support 2,546 2,545 8,045 7,327 Total revenue 6,103 5,773 18,661 18,504 Revenue less costs of revenue, excluding depreciation and amortization License fees and services 2,596 2,185 7,648 7,719 Customer support 2,248 2,149 7,042 6,211 4,844 4,334 14,690 13,930 Unallocated Costs Other operating expenses 2,885 3,259 9,066 10,265 Depreciation and amortization 253 121 792 348 Restructuring 3 - 1,007 - Interest income (1) (5) (4) (14) Interest expense 74 3 265 9 Foreign currency exchange (gain) loss 261 244 508 218 Income from operations before income taxes $ 1,369 $ 712 $ 3,056 $ 3,104 |
Financial Information Relating To Operations By Geographic Region | For the Three Months Ended September 30, 2016 Revenue L&S CS Total Algeria $ 867 $ - $ 867 United Kingdom 352 370 722 Switzerland 505 181 686 Other 1,833 1,995 3,828 Total revenues $ 3,557 $ 2,546 $ 6,103 For the Three Months Ended September 30, 2015 Revenue L&S CS Total United Kingdom $ 638 $ 429 $ 1,067 Indonesia 488 103 591 Other 2,102 2,013 4,115 Total revenues $ 3,228 $ 2,545 $ 5,773 For the Nine Months Ended September 30, 2016 Revenue L&S CS Total United Kingdom $ 1,447 $ 1,175 $ 2,622 Switzerland 1,570 539 2,109 Other 7,599 6,331 13,930 Total revenues $ 10,616 $ 8,045 $ 18,661 For the Nine Months Ended September 30, 2015 Revenue L&S CS Total United Kingdom $ 1,599 $ 1,344 $ 2,943 Other 9,578 5,983 15,561 Total revenues $ 11,177 $ 7,327 $ 18,504 |
Summary Of Long-lived Assets, Net | September 30, December 31, Long-lived assets, net 2016 2015 United States $ 12,356 $ 13,026 United Kingdom 13,366 15,318 Other 302 341 $ 26,024 $ 28,685 |
Basis Of Presentation (Narrativ
Basis Of Presentation (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)item | Sep. 30, 2015USD ($) | |
Basis Of Presentation [Abstract] | ||||
Number of recognized sources for revenue | item | 2 | |||
Time period for unearned revenue to be billed and collected | 12 months | |||
Adjustment on contract | $ | $ 0 | $ 0 | $ 0 | $ 0 |
Acquisition (Narrative) (Detail
Acquisition (Narrative) (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jul. 31, 2016 | Dec. 31, 2015 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 21,269 | $ 21,500 | $ 23,142 | ||
Change in goodwill from acquisition | 0 | ||||
Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Initial payment | $ 9,750 | ||||
Working capital adjustment | 535 | ||||
Cash payment on anniversary of the transaction | 250 | ||||
Goodwill | 6,949 | $ 6,949 | |||
Intangible assets | 4,642 | $ 4,642 | |||
Amortization expense related to the acquired intangible assets | $ 689 | ||||
Weighted average amortization period | 7 years 2 months 9 days | 7 years | |||
Revenue | $ 3,900 | ||||
Net income | 900 | ||||
License And Services [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | 5,400 | $ 5,400 | |||
Customer Support [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Goodwill | $ 1,500 | $ 1,500 | |||
Trademarks And Tradenames [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Amortization expense related to the acquired intangible assets | $ 61 | ||||
Weighted average amortization period | 2 years | ||||
Purchased Software [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Amortization expense related to the acquired intangible assets | $ 210 | ||||
Weighted average amortization period | 8 years | ||||
Non-competition [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Amortization expense related to the acquired intangible assets | $ 17 | ||||
Weighted average amortization period | 2 years | ||||
Customer Relationships [Member] | Evolving Systems NC, Inc [Member] | |||||
Business Acquisition [Line Items] | |||||
Amortization expense related to the acquired intangible assets | $ 401 | ||||
Weighted average amortization period | 7 years |
Acquisition (Summary Of Total P
Acquisition (Summary Of Total Purchase Price) (Details) - Evolving Systems NC, Inc [Member] $ in Thousands | Sep. 30, 2015USD ($) |
Cash Consideration | |
Initial Cash Purchase Price | $ 9,750 |
Cash/Working Capital Adjustment | 535 |
Total Cash Consideration | 10,285 |
Assumed Liabilities | 250 |
Total purchase price | $ 10,535 |
Acquisition (Schedule Of Assets
Acquisition (Schedule Of Assets Acquired and Liabilities Assumed At Acquisition Date) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Jul. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 21,269 | $ 21,500 | $ 23,142 | |
Evolving Systems NC, Inc [Member] | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 1,521 | |||
Contract receivables | 1,057 | |||
Unbilled work-in-progress | 89 | |||
Intangible assets | 4,642 | |||
Prepaid and other current assets | 68 | |||
Other assets, non-current | 32 | |||
Total identifiable assets acquired | 7,409 | |||
Accounts payable and accrued liabilities | 1,506 | |||
Deferred tax liability | 1,760 | |||
Deferred revenue | 557 | |||
Total identifiable liabilities acquired | 3,823 | |||
Net identifiable assets acquired | 3,586 | |||
Goodwill | 6,949 | |||
Net assets acquired | $ 10,535 |
Acquisition (Intangible Assets
Acquisition (Intangible Assets Related To Acquisition) (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Net Carrying Amount | $ 4,396 | $ 4,983 | |
Evolving Systems NC, Inc [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross Amount | 4,642 | ||
Accumulated Amortization | 689 | ||
Net Carrying Amount | $ 3,953 | ||
Weighted-Average Amortization Period | 7 years 2 months 9 days | 7 years | |
Evolving Systems NC, Inc [Member] | Purchased Software [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross Amount | $ 1,679 | ||
Accumulated Amortization | 210 | ||
Net Carrying Amount | $ 1,469 | ||
Weighted-Average Amortization Period | 8 years | ||
Evolving Systems NC, Inc [Member] | Trademarks And Tradenames [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross Amount | $ 122 | ||
Accumulated Amortization | 61 | ||
Net Carrying Amount | $ 61 | ||
Weighted-Average Amortization Period | 2 years | ||
Evolving Systems NC, Inc [Member] | Non-competition [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross Amount | $ 33 | ||
Accumulated Amortization | 17 | ||
Net Carrying Amount | $ 16 | ||
Weighted-Average Amortization Period | 2 years | ||
Evolving Systems NC, Inc [Member] | Customer Relationships [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Gross Amount | $ 2,808 | ||
Accumulated Amortization | 401 | ||
Net Carrying Amount | $ 2,407 | ||
Weighted-Average Amortization Period | 7 years |
Acquisition (Schedule Of Pro Fo
Acquisition (Schedule Of Pro Forma Information) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Actual [Member] | ||
Revenue | $ 18,661 | |
Net Income | $ 2,148 | |
Pro-forma [Member] | ||
Revenue | $ 23,118 | |
Net Income | $ 2,559 |
Goodwill And Intangible Asset33
Goodwill And Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands | Jul. 31, 2016 | Jul. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 |
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | $ 21,500 | $ 21,269 | $ 21,269 | $ 23,142 | |||
Amortization of intangible assets | 196 | $ 24 | 587 | $ 71 | |||
Evolving Systems NC, Inc [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 6,949 | 6,949 | |||||
Income Approach Valuation Technique [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Fair value inputs, comparability adjustments | 30.00% | ||||||
Market Approach Valuation Technique [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Fair value inputs, comparability adjustments | 70.00% | ||||||
License And Services [Member] | Evolving Systems NC, Inc [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 5,400 | 5,400 | |||||
License And Services [Member] | United States [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 6,281 | 6,281 | 6,281 | ||||
Percentage of hypothetical decrease in estimated fair value | 18.00% | ||||||
License And Services [Member] | India [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 182 | 182 | 184 | ||||
License And Services [Member] | United Kingdom [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 5,930 | 5,930 | 6,767 | ||||
Customer Support [Member] | Evolving Systems NC, Inc [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | $ 1,500 | $ 1,500 | |||||
Customer Support [Member] | United States [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | 1,549 | 1,549 | 1,549 | ||||
Percentage of hypothetical decrease in estimated fair value | 23.00% | ||||||
Customer Support [Member] | United Kingdom [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Goodwill | $ 7,327 | $ 7,327 | $ 8,361 | ||||
Minimum [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Estimated useful life of intangible asset | 1 year | ||||||
Maximum [Member] | |||||||
Goodwill And Intangible Assets [Line Items] | |||||||
Estimated useful life of intangible asset | 8 years |
Goodwill And Intangible Asset34
Goodwill And Intangible Assets (Summary Of Changes In Carrying Amount Of Goodwill) (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016USD ($) | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | $ 23,142 | |
Effects of changes in foreign currency exchange rates | (1,873) | [1] |
Balance at September 30, 2016 | 21,269 | |
United States [Member] | License And Services [Member] | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | 6,281 | |
Effects of changes in foreign currency exchange rates | [1] | |
Balance at September 30, 2016 | 6,281 | |
United States [Member] | Customer Support [Member] | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | 1,549 | |
Effects of changes in foreign currency exchange rates | [1] | |
Balance at September 30, 2016 | 1,549 | |
India [Member] | License And Services [Member] | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | 184 | |
Effects of changes in foreign currency exchange rates | (2) | [1] |
Balance at September 30, 2016 | 182 | |
United Kingdom [Member] | License And Services [Member] | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | 6,767 | |
Effects of changes in foreign currency exchange rates | (837) | [1] |
Balance at September 30, 2016 | 5,930 | |
United Kingdom [Member] | Customer Support [Member] | ||
Goodwill And Intangible Assets [Line Items] | ||
Balance as of December 31, 2015 | 8,361 | |
Effects of changes in foreign currency exchange rates | (1,034) | [1] |
Balance at September 30, 2016 | $ 7,327 | |
[1] | Represents the impact of foreign currency translation for instances when goodwill is recorded in foreign entities whose functional currency is also their local currency. Goodwill balances are translated into U.S. dollars using exchange rates in effect at period end. Adjustments related to foreign currency translation are included in other comprehensive income. |
Goodwill And Intangible Asset35
Goodwill And Intangible Assets (Summary Of Identifiable Intangible Assets) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Net Carrying Amount | $ 4,396 | $ 4,983 |
Evolving Systems NC, Inc And Evolving Systems Labs [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 5,360 | 5,360 |
Accumulated Amortization | 964 | 377 |
Net Carrying Amount | $ 4,396 | $ 4,983 |
Weighted-Average Amortization Period | 6 years 9 months 18 days | 6 years 9 months 18 days |
Evolving Systems NC, Inc And Evolving Systems Labs [Member] | Purchased Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 2,118 | $ 2,118 |
Accumulated Amortization | 370 | 171 |
Net Carrying Amount | $ 1,748 | $ 1,947 |
Weighted-Average Amortization Period | 7 years 3 months 18 days | 7 years 3 months 18 days |
Evolving Systems NC, Inc And Evolving Systems Labs [Member] | Trademarks And Tradenames [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 185 | $ 185 |
Accumulated Amortization | 98 | 43 |
Net Carrying Amount | $ 87 | $ 142 |
Weighted-Average Amortization Period | 2 years 7 months 6 days | 2 years 7 months 6 days |
Evolving Systems NC, Inc And Evolving Systems Labs [Member] | Non-competition [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 33 | $ 33 |
Accumulated Amortization | 16 | 4 |
Net Carrying Amount | $ 17 | $ 29 |
Weighted-Average Amortization Period | 2 years | 2 years |
Evolving Systems NC, Inc And Evolving Systems Labs [Member] | Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 3,024 | $ 3,024 |
Accumulated Amortization | 480 | 159 |
Net Carrying Amount | $ 2,544 | $ 2,865 |
Weighted-Average Amortization Period | 6 years 9 months 18 days | 6 years 9 months 18 days |
Goodwill And Intangible Asset36
Goodwill And Intangible Assets (Summary Of Expected Future Amortization Expense Related To Identifiable Intangibles) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Goodwill And Intangible Assets [Abstract] | ||
2,017 | $ 783 | |
2,018 | 705 | |
2,019 | 694 | |
2,020 | 693 | |
2,021 | 693 | |
Thereafter | 828 | |
Net Carrying Amount | $ 4,396 | $ 4,983 |
Earnings Per Common Share (Summ
Earnings Per Common Share (Summary Of Basic And Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Basic income per share: | ||||
Net income available to common stockholders | $ 941 | $ 570 | $ 2,148 | $ 2,210 |
Basic weighted average shares outstanding | 11,873 | 11,687 | 11,824 | 11,677 |
Basic income per share: | $ 0.08 | $ 0.05 | $ 0.18 | $ 0.19 |
Diluted income per share: | ||||
Net income available to common stockholders | $ 941 | $ 570 | $ 2,148 | $ 2,210 |
Weighted average shares outstanding | 11,873 | 11,687 | 11,824 | 11,677 |
Effect of dilutive securities - options | 106 | 240 | 143 | 261 |
Diluted weighted average shares outstanding | 11,979 | 11,927 | 11,967 | 11,938 |
Diluted income per share: | $ 0.08 | $ 0.05 | $ 0.18 | $ 0.19 |
Common stock shares excluded from dilutive stock calculation | 500 | 300 | 500 | 300 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Jun. 30, 2013 | Jun. 30, 2010 | Jun. 30, 2007 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Compensation expense | $ 52,000 | $ 69,000 | $ 198,000 | $ 229,000 | ||||||
Restricted stock-based compensation expense | 8,000 | 23,000 | 1,000 | |||||||
Fair value of stock options vested | $ 100,000 | $ 100,000 | $ 200,000 | $ 300,000 | ||||||
Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock options granted | 40,000 | 172,000 | ||||||||
Number of shares restricted stock vested | 5,000 | 0 | 5,000 | 94 | ||||||
Number of shares restricted stock forfeited | 0 | 0 | 0 | 1,031 | ||||||
Options remained outstanding under option plan | 689,000 | 689,000 | 834,000 | |||||||
Weighted-average grant-date fair value of stock options granted | $ 1.16 | $ 0.96 | ||||||||
Total unrecognized compensation costs related to unvested stock options | $ 500,000 | $ 500,000 | ||||||||
Weighted average recognition period | 2 years 8 months 19 days | |||||||||
Cash received from exercise of stock options | $ 9,000 | $ 0 | $ 50,000 | $ 27,000 | ||||||
Net settlement exercises shares issued | 93,782 | |||||||||
Net settlement exercises shares cancelled | 32,502 | |||||||||
Net settlement exercises shares | 0 | 0 | ||||||||
2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized | 2,002,209 | 1,502,209 | 1,250,000 | 1,000,000 | ||||||
Shares available for grant | 300,000 | 300,000 | ||||||||
Shares reserved for acquisitions | 200,000 | 200,000 | ||||||||
Shares issued and outstanding | 700,000 | 700,000 | 800,000 | |||||||
2007 Stock Plan [Member] | Initial [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 3 years | |||||||||
2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Number of shares authorized | 250,000 | |||||||||
Shares available for grant | 0 | 0 | ||||||||
2016 Stock Plan [Member] | Initial [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 3 years | |||||||||
Employee Stock Purchase Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Compensation expense | $ 160 | $ 3,000 | $ 2,000 | $ 11,000 | ||||||
Number of shares authorized | 550,000 | 550,000 | ||||||||
Cash received from exercise of stock options | $ 1,000 | $ 11,000 | $ 6,000 | $ 44,000 | ||||||
Maximum employee subscription rate | 15.00% | 15.00% | ||||||||
Maximum value of shares per employee | $ 25,000 | |||||||||
Maximum number of shares per employee | 10,000 | |||||||||
Purchase price of stock | 85.00% | |||||||||
Shares available for purchase under ESPP | 51,000 | 51,000 | ||||||||
Discount on the purchase price of stock option | 15.00% | |||||||||
Issued shares related to the ESPP | 200 | 2,000 | 1,000 | 7,000 | ||||||
Maximum [Member] | 2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Option expiration period | 10 years | |||||||||
Maximum [Member] | 2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Option expiration period | 10 years | |||||||||
Employees [Member] | 2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 4 years | |||||||||
Employees [Member] | 2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 4 years | |||||||||
Directors [Member] | 2007 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 1 year | |||||||||
Directors [Member] | 2016 Stock Plan [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Vesting period | 1 year | |||||||||
Senior Management [Member] | Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Restricted stock granted in period | 0 | 20,000 | 0 | |||||||
Senior Management [Member] | Minimum [Member] | Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Release period for restricted stock options | 2 years | |||||||||
Senior Management [Member] | Maximum [Member] | Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Release period for restricted stock options | 4 years | |||||||||
Board Members [Member] | Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Release period for restricted stock options | 1 year | |||||||||
Evolving Systems U.K. [Member] | Stock Incentive Plans [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Deferred income tax benefits from stock option expense | $ 3,000 | $ 5,000 | $ 10,000 | $ 14,000 |
Share-Based Compensation (Summa
Share-Based Compensation (Summary Of Stock-Based Compensation Expenses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | $ 52 | $ 69 | $ 198 | $ 229 |
Cost Of License Fees And Services, Excluding Depreciation And Amortization [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 7 | 17 | 27 | 56 |
Cost Of Customer Support, Excluding Depreciation And Amortization [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 1 | 3 | 5 | 8 |
Sales And Marketing [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 7 | 10 | 20 | 26 |
General And Administrative [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | 20 | 23 | 90 | 76 |
Product Development [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Total share based compensation | $ 17 | $ 16 | $ 56 | $ 63 |
Share-Based Compensation (Assum
Share-Based Compensation (Assumptions For Weighted Average Fair Value Of Stock Options) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Stock Incentive Plans [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 years | 6 years | 6 years | 6 years |
Risk-free interest rate | 1.10% | 1.37% | 1.32% | 1.37% |
Expected volatility | 36.55% | 37.76% | 36.81% | 42.47% |
Expected dividend yield | 4.23% | 7.33% | 7.22% | 6.32% |
Employee Stock Purchase Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 3 months | 3 months | 3 months | 3 months |
Risk-free interest rate | 0.27% | 0.01% | 0.23% | 0.03% |
Expected volatility | 40.28% | 41.51% | 41.56% | 38.20% |
Expected dividend yield | 5.06% | 7.33% | 7.58% | 5.77% |
Share-Based Compensation (Sum41
Share-Based Compensation (Summary Of Stock Option Activity) (Details) - Stock Incentive Plans [Member] - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Shares, Options outstanding at beginning | 834 | |
Number of Shares, Options granted | 158 | |
Number of Shares, Less options forfeited | (191) | |
Number of Shares, Less options exercised | (112) | |
Number of Shares, Options outstanding at ending | 689 | 834 |
Number of Shares, Option exercisable at September 30, 2016 | 347 | |
Weighted-Average Exercise Price, Options outstanding at beginning | $ 5.97 | |
Weighted-Average Exercise Price, Options granted | 5.31 | |
Weighted-Average Exercise Price, Less options forfeited | 7.44 | |
Weighted-Average Exercise Price, Less options exercised | 1.14 | |
Weighted-Average Exercise Price, Options outstanding at ending | 6.19 | $ 5.97 |
Weighted-Average Exercise Price, Options exercisable at September 30, 2016 | $ 6.09 | |
Weighted-Average Remaining Contractual Term (Years), Options outstanding | 7 years 6 months 18 days | 6 years 11 months 9 days |
Weighted-Average Remaining Contractual Term (Years), Option exercisable at September 30, 2016 | 6 years 1 month 2 days | |
Aggregate Intrinsic Value, Options outstanding | $ 174 | $ 957 |
Aggregate Intrinsic Value, Options exercisable at September 30, 2016 | $ 174 |
Concentration Of Credit Risk (N
Concentration Of Credit Risk (Narrative) (Details) - customer | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Sales Revenue Net [Member] | Customer Concentration Risk [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 0 | 0 | 0 | ||
Concentration risk, percentage | 10.00% | 10.00% | 10.00% | ||
Sales Revenue Net [Member] | Customer Concentration Risk [Member] | Minimum [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 10.00% | ||||
Sales Revenue Net [Member] | Customer One [Member] | Africa [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 1 | ||||
Concentration risk, percentage | 13.00% | ||||
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer Concentration Risk [Member] | Africa [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 1 | ||||
Concentration risk, percentage | 14.00% | ||||
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer Concentration Risk [Member] | Africa And Europe [Member] | |||||
Concentration Risk [Line Items] | |||||
Number of significant customers | 2 | ||||
Concentration risk, percentage | 36.00% | ||||
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer One [Member] | Africa [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 25.00% | ||||
Contract Receivables And Unbilled Work-In-Progress [Member] | Customer Two [Member] | Europe [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage | 11.00% |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | Feb. 29, 2016USD ($) | Sep. 30, 2016USD ($)item |
Term Loan [Member] | East West Bank [Member] | ||
Debt Instrument [Line Items] | ||
Loan amount | $ 6,000,000 | |
Number of monthly installments of principal | item | 36 | |
Maturity date | Jan. 1, 2020 | |
Cash balances to pay off revolving facilities | $ 4,000,000 | |
Debt issuance cost | $ 8,000 | |
Term Loan [Member] | East West Bank [Member] | Prime Rate [Member] | ||
Debt Instrument [Line Items] | ||
Rate plus prime rate | 1.00% | |
Revolving Facility [Member] | ||
Debt Instrument [Line Items] | ||
Two annual credit facility fees | 18,750 | |
Legal fee | 1,000 | |
Revolving facilities amount to pay off and terminate | $ 10,000,000 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016USD ($)item | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)item | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Income Taxes [Line Items] | ||||||
Net income tax expense | $ 428 | $ 142 | $ 908 | $ 894 | ||
Deferred tax expense (benefit) | $ 100 | |||||
Effective tax rate | 31.00% | 20.00% | 30.00% | 29.00% | ||
Deferred tax assets | ||||||
Cumulative stock ownership change over three year period that could limit federal net operating loss carry forwards | 50.00% | |||||
Unrecognized tax benefits | $ 0 | $ 0 | $ 0 | |||
Number of income tax returns under examination | item | 0 | 0 | ||||
Federal [Member] | ||||||
Income Taxes [Line Items] | ||||||
Federal net operating loss carryforwards | $ 2,300 | |||||
Foreign tax credit carryforwards as a deferred tax asset | $ 4,500 | $ 4,500 | ||||
Indian Operations [Member] | ||||||
Income Taxes [Line Items] | ||||||
Number of years subject to income tax examination | 4 years | |||||
U.K. Operations [Member] | ||||||
Income Taxes [Line Items] | ||||||
Number of years subject to income tax examination | 2 years | |||||
U.K. Operations [Member] | Evolving Systems NC, Inc [Member] | ||||||
Income Taxes [Line Items] | ||||||
Deferred tax expense (benefit) | 100 | $ (19) | ||||
U.K. and India Operations [Member] | ||||||
Income Taxes [Line Items] | ||||||
Current income tax expense | $ 100 | $ 900 | $ 900 | |||
Deferred tax expense (benefit) | $ (25) | |||||
U.S., U.K. and India Operations [Member] | ||||||
Income Taxes [Line Items] | ||||||
Current income tax expense | $ 300 |
Income Taxes (Components Of Def
Income Taxes (Components Of Deferred Tax Assets And Liabilities) (Details) $ in Thousands | Sep. 30, 2016USD ($) |
Deferred tax assets | |
Foreign tax credits carryforwards | $ 4,518 |
Net operating loss carryforwards | 1,024 |
Research & development credits | 303 |
AMT credits | 770 |
Stock compensation | 587 |
Depreciable assets | 105 |
Accrued liabilities and reserves | 232 |
Total deferred tax assets | 7,539 |
Deferred tax liabilities | |
Undistributed foreign earnings | (1,140) |
Intangibles | (1,330) |
Total deferred tax liability | (2,470) |
Net deferred tax assets, before valuation allowance | 5,069 |
Valuation allowance | (5,069) |
Net deferred tax asset |
Stockholders' Equity (Narrative
Stockholders' Equity (Narrative) (Details) - $ / shares | May 03, 2016 | Mar. 15, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 |
Stockholders' Equity [Line Items] | ||||||
Cash dividend declared per common share | $ 0.11 | $ 0.22 | $ 0.33 | |||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | ||||
Preferred stock, shares outstanding | 0 | 0 | ||||
Anti-takeover provisions period | 3 years | |||||
Second Quarter [Member] | ||||||
Stockholders' Equity [Line Items] | ||||||
Dividend declared date | May 3, 2016 | |||||
Cash dividend declared per common share | $ 0.11 | |||||
Dividends payable, payable date | Jul. 1, 2016 | |||||
Dividends payable, record date | Jun. 3, 2016 | |||||
First Quarter [Member] | ||||||
Stockholders' Equity [Line Items] | ||||||
Dividend declared date | Mar. 15, 2016 | |||||
Cash dividend declared per common share | $ 0.11 | |||||
Dividends payable, payable date | Apr. 1, 2016 | |||||
Dividends payable, record date | Mar. 28, 2016 |
Segment Information (Segment In
Segment Information (Segment Information) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)segment | Sep. 30, 2015USD ($) | |
Revenue | ||||
Total revenue | $ 6,103 | $ 5,773 | $ 18,661 | $ 18,504 |
Revenue less costs of revenue, excluding depreciation and amortization | ||||
Revenue less costs of revenue, excluding depreciation and amortization | 4,844 | 4,334 | 14,690 | 13,930 |
Unallocated Costs | ||||
Other operating expenses | 2,885 | 3,259 | 9,066 | 10,265 |
Depreciation and amortization | 253 | 121 | 792 | 348 |
Restructuring | 3 | 1,007 | ||
Interest income | (1) | (5) | (4) | (14) |
Interest expense | 74 | 3 | 265 | 9 |
Foreign currency exchange (gain) loss | 261 | 244 | 508 | 218 |
Income from operations before income taxes | 1,369 | 712 | $ 3,056 | 3,104 |
Number of operating segments based on revenue type | segment | 2 | |||
License And Services [Member] | ||||
Revenue | ||||
Total revenue | 3,557 | 3,228 | $ 10,616 | 11,177 |
Revenue less costs of revenue, excluding depreciation and amortization | ||||
Revenue less costs of revenue, excluding depreciation and amortization | 2,596 | 2,185 | 7,648 | 7,719 |
Customer Support [Member] | ||||
Revenue | ||||
Total revenue | 2,546 | 2,545 | 8,045 | 7,327 |
Revenue less costs of revenue, excluding depreciation and amortization | ||||
Revenue less costs of revenue, excluding depreciation and amortization | $ 2,248 | $ 2,149 | $ 7,042 | $ 6,211 |
Segment Information (Financial
Segment Information (Financial Information Relating To Operations By Geographic Region) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 6,103 | $ 5,773 | $ 18,661 | $ 18,504 |
Algeria [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 867 | |||
United Kingdom [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 722 | 1,067 | 2,622 | 2,943 |
Switzerland [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 686 | 2,109 | ||
Indonesia [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 591 | |||
Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 3,828 | 4,115 | 13,930 | 15,561 |
License And Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 3,557 | 3,228 | 10,616 | 11,177 |
License And Services [Member] | Algeria [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 867 | |||
License And Services [Member] | United Kingdom [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 352 | 638 | 1,447 | 1,599 |
License And Services [Member] | Switzerland [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 505 | 1,570 | ||
License And Services [Member] | Indonesia [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 488 | |||
License And Services [Member] | Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 1,833 | 2,102 | 7,599 | 9,578 |
Customer Support [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 2,546 | 2,545 | 8,045 | 7,327 |
Customer Support [Member] | United Kingdom [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 370 | 429 | 1,175 | 1,344 |
Customer Support [Member] | Switzerland [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 181 | 539 | ||
Customer Support [Member] | Indonesia [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | 103 | |||
Customer Support [Member] | Other [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total revenues | $ 1,995 | $ 2,013 | $ 6,331 | $ 5,983 |
Segment Information (Summary Of
Segment Information (Summary Of Long-lived Assets, Net) (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 26,024 | $ 28,685 |
United States [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 12,356 | 13,026 |
United Kingdom [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | 13,366 | 15,318 |
Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, net | $ 302 | $ 341 |
Commitments And Contingencies (
Commitments And Contingencies (Narrative) (Details) - Telespree [Member] - USD ($) $ in Millions | Oct. 24, 2013 | Sep. 30, 2016 |
Other Commitments [Line Items] | ||
Acquisition date | Oct. 24, 2013 | |
Initial payment | $ 0.5 |
Restructuring (Narrative) (Deta
Restructuring (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Oct. 31, 2015 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring expense | $ 3 | $ 1,007 | ||||
Restructuring liability | 100 | $ 100 | $ 25 | |||
Evolving Systems NC, Inc [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expense of termination employees | $ 500 | $ 3 | $ 100 | $ 900 |