Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 31, 2013 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'IKONICS CORP | ' |
Entity Central Index Key | '0001083301 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 2,008,836 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
CONDENSED_BALANCE_SHEETS
CONDENSED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
CURRENT ASSETS: | ' | ' |
Cash and cash equivalents | $1,179,498 | $967,943 |
Short-term investments | 1,814,878 | 1,442,939 |
Trade receivables, less allowance of $42,000 in 2013 and $43,000 in 2012 | 1,899,714 | 2,060,312 |
Inventories | 2,515,698 | 2,678,864 |
Prepaid expenses and other assets | 135,768 | 124,983 |
Income taxes receivable | 91,671 | ' |
Deferred income taxes | 142,000 | 142,000 |
Total current assets | 7,779,227 | 7,417,041 |
PROPERTY, PLANT, AND EQUIPMENT, at cost: | ' | ' |
Land and building | 6,110,906 | 6,063,965 |
Machinery and equipment | 3,690,574 | 3,219,598 |
Office equipment | 742,951 | 700,062 |
Vehicles | 237,488 | 237,488 |
Gross property, plant, and equipment, at cost | 10,781,919 | 10,221,113 |
Less accumulated depreciation | 5,171,831 | 4,759,235 |
Net property, plant, and equipment, at cost | 5,610,088 | 5,461,878 |
INTANGIBLE ASSETS, less accumulated amortization of $521,727 in 2013 and $482,107 in 2012 | 335,046 | 305,357 |
Total assets | 13,724,361 | 13,184,276 |
CURRENT LIABILITIES: | ' | ' |
Accounts payable | 660,054 | 593,922 |
Accrued compensation | 333,289 | 265,822 |
Other accrued liabilities | 97,359 | 81,635 |
Income taxes payable | ' | 82,152 |
Total current liabilities | 1,090,702 | 1,023,531 |
DEFERRED INCOME TAXES | 431,000 | 366,000 |
Total liabilities | 1,521,702 | 1,389,531 |
STOCKHOLDERS' EQUITY: | ' | ' |
Preferred stock, par value $.10 per share; authorized 250,000 shares; issued none | ' | ' |
Common stock, par value $.10 per share; authorized 4,750,000 shares; issued and outstanding 2,008,836 shares in 2013 and 1,998,475 shares in 2012 | 200,884 | 199,848 |
Additional paid-in capital | 2,555,861 | 2,470,507 |
Retained earnings | 9,445,914 | 9,124,390 |
Total stockholders' equity | 12,202,659 | 11,794,745 |
Total liabilities and stockholders' equity | $13,724,361 | $13,184,276 |
CONDENSED_BALANCE_SHEETS_Paren
CONDENSED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
CONDENSED BALANCE SHEETS | ' | ' |
Trade receivables, allowance (in dollars) | $42,000 | $43,000 |
INTANGIBLE ASSETS, accumulated amortization (in dollars) | $521,727 | $482,107 |
Preferred stock, par value (in dollars per share) | $0.10 | $0.10 |
Preferred stock, shares authorized | 250,000 | 250,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $0.10 | $0.10 |
Common stock, shares authorized | 4,750,000 | 4,750,000 |
Common stock, shares issued | 2,008,836 | 1,998,475 |
Common stock, shares outstanding | 2,008,836 | 1,998,475 |
CONDENSED_STATEMENTS_OF_INCOME
CONDENSED STATEMENTS OF INCOME (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
CONDENSED STATEMENTS OF INCOME | ' | ' | ' | ' |
NET SALES | $4,217,125 | $4,231,235 | $12,894,142 | $12,787,939 |
COST OF GOODS SOLD | 2,575,557 | 2,478,358 | 7,904,357 | 7,726,216 |
GROSS PROFIT | 1,641,568 | 1,752,877 | 4,989,785 | 5,061,723 |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 1,330,199 | 1,273,286 | 4,124,801 | 3,984,854 |
RESEARCH AND DEVELOPMENT EXPENSES | 149,864 | 141,186 | 475,791 | 470,165 |
INCOME FROM OPERATIONS | 161,505 | 338,405 | 389,193 | 606,704 |
INTEREST INCOME | 1,372 | 2,572 | 5,331 | 9,377 |
INCOME BEFORE INCOME TAXES | 162,877 | 340,977 | 394,524 | 616,081 |
INCOME TAX EXPENSE | 46,715 | 112,865 | 73,000 | 207,292 |
NET INCOME | $116,162 | $228,112 | $321,524 | $408,789 |
EARNINGS PER COMMON SHARE: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.06 | $0.11 | $0.16 | $0.21 |
Diluted (in dollars per share) | $0.06 | $0.11 | $0.16 | $0.21 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ' | ' | ' | ' |
Basic (in shares) | 2,008,836 | 1,989,307 | 2,005,702 | 1,986,798 |
Diluted (in shares) | 2,015,125 | 1,993,429 | 2,010,334 | 1,990,485 |
CONDENSED_STATEMENTS_OF_CASH_F
CONDENSED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ' | ' |
Net income | $321,524 | $408,789 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation | 416,068 | 361,811 |
Amortization | 39,620 | 41,612 |
Stock based compensation | 10,143 | 13,391 |
Gain on disposal of property, plant and equipment | -2,979 | ' |
Loss on intangible asset abandonment | ' | 22,324 |
Deferred income taxes | 65,000 | ' |
Changes in working capital components: | ' | ' |
Trade receivables | 160,598 | -87,129 |
Inventories | 163,166 | -340,484 |
Prepaid expenses and other assets | -10,785 | -87,101 |
Income taxes receivable | -91,671 | 59,322 |
Accounts payable | 66,132 | -43,109 |
Accrued expenses | 83,191 | 127,169 |
Income taxes payable | -69,397 | 90,344 |
Net cash provided by operating activities | 1,150,610 | 566,939 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ' | ' |
Purchases of property, plant and equipment | -585,806 | -372,217 |
Proceeds from disposal of property, plant and equipment | 24,507 | ' |
Purchases of intangibles | -69,309 | -30,386 |
Purchases of short-term investments | -1,814,878 | -1,649,988 |
Proceeds on sale of short-term investments | 1,442,939 | 1,837,699 |
Net cash used in investing activities | -1,002,547 | -214,892 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ' | ' |
Proceeds from exercise of stock options | 63,492 | 30,123 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 211,555 | 382,170 |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 967,943 | 1,867,165 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 1,179,498 | 2,249,335 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ' | ' |
Cash paid for income taxes, net of taxes received of $13,026 in 2013 and $18,650 paid in 2012. | $169,068 | $57,626 |
CONDENSED_STATEMENTS_OF_CASH_F1
CONDENSED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
CONDENSED STATEMENTS OF CASH FLOWS | ' | ' |
Income taxes, received | $13,026 | ' |
Income taxes, paid | ' | $18,650 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Basis of Presentation | ' |
Basis of Presentation | ' |
1. Basis of Presentation | |
The balance sheet of IKONICS Corporation (the “Company”) as of September 30, 2013, and the related statements of operations for the three and nine months ended September 30, 2013 and 2012, and cash flows for the nine months ended September 30, 2013 and 2012, have been prepared without being audited. | |
In the opinion of management, these statements reflect all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position of IKONICS Corporation as of September 30, 2013, and the results of operations and cash flows for all periods presented. | |
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted. Therefore, these statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. | |
The results of operations for interim periods are not necessarily indicative of results that will be realized for the full fiscal year. | |
ShortTerm_Investments
Short-Term Investments | 9 Months Ended |
Sep. 30, 2013 | |
Short-Term Investments | ' |
Short-Term Investments | ' |
2. Short-Term Investments | |
The Company’s short-term investments of approximately $1,815,000 at September 30, 2013 are comprised of fully insured certificates of deposit with original maturities ranging from three to twelve months and interest rates ranging from 0.2% to 1.0%. | |
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ' | |||||||
Inventories | ' | |||||||
3. Inventories | ||||||||
The major components of inventories are as follows: | ||||||||
30-Sep-13 | 31-Dec-12 | |||||||
Raw materials | $ | 2,060,334 | $ | 2,072,540 | ||||
Work-in-progress | 408,041 | 373,512 | ||||||
Finished goods | 1,296,047 | 1,478,444 | ||||||
Reduction to LIFO cost | (1,248,724 | ) | (1,245,632 | ) | ||||
Total Inventory | $ | 2,515,698 | $ | 2,678,864 | ||||
Earnings_Per_Common_Share_EPS
Earnings Per Common Share (EPS) | 9 Months Ended | |||||
Sep. 30, 2013 | ||||||
Earnings Per Common Share (EPS) | ' | |||||
Earnings Per Common Share (EPS) | ' | |||||
4. Earnings Per Common Share (EPS) | ||||||
Basic EPS is calculated using net income divided by the weighted average of common shares outstanding. Diluted EPS is similar to Basic EPS except that the weighted average number of common shares outstanding is increased to include the number of additional common shares that would have been outstanding if the potential dilutive common shares, such as those shares subject to options, had been issued. | ||||||
Shares used in the calculation of diluted EPS are summarized below: | ||||||
Three Months Ended | ||||||
30-Sep-13 | 30-Sep-12 | |||||
Weighted average common shares outstanding | 2,008,836 | 1,989,307 | ||||
Dilutive effect of stock options | 6,289 | 4,122 | ||||
Weighted average common and common equivalent shares outstanding | 2,015,125 | 1,993,429 | ||||
Nine Months Ended | ||||||
30-Sep-13 | 30-Sep-12 | |||||
Weighted average common shares outstanding | 2,005,702 | 1,986,798 | ||||
Dilutive effect of stock options | 4,632 | 3,687 | ||||
Weighted average common and common equivalent shares outstanding | 2,010,334 | 1,990,485 | ||||
There were no anti-dilutive options outstanding during the three and nine months ended September 30, 2013 and 2012. | ||||||
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Stock-Based Compensation | ' | |||||||
Stock-Based Compensation | ' | |||||||
5. Stock-Based Compensation | ||||||||
The Company maintains a stock incentive plan which authorizes the issuance of up to 442,750 shares of common stock. Of those shares, 14,751 were subject to outstanding options and 115,573 were reserved for future grants at September 30, 2013. The plan provides for granting eligible participants stock options or other stock awards, as described by the plan, at option prices ranging from 85% to 110% of fair market value at the date of grant. Options granted expire up to seven years after the date of grant. Such options generally become exercisable over a one to three year period. | ||||||||
The Company charged compensation cost of approximately $3,800 against income for the three months ended September 30, 2013 and approximately $4,400 for the three months ended September 30, 2012. For the first nine months of 2013, the Company charged compensation cost of approximately $10,100 against income and approximately $13,400 for the same period in 2012. As of September 30, 2013, there was approximately $24,000 of unrecognized compensation cost related to unvested share-based compensation awards granted. That cost is expected to be recognized over the next three years. | ||||||||
The Company receives a tax deduction for certain stock option exercises during the period in which the options are exercised, generally for the excess of the market price at the time the stock options are exercised over the exercise price of the options, which increases the APIC pool, which is the amount that represents the pool of excess tax benefits available to absorb tax shortages. There were no excess tax benefits recognized during the three or nine month periods ended September 30, 2013 and 2012. The Company’s APIC pool totaled approximately $111,000 at September 30, 2013 and December 31, 2012. | ||||||||
Proceeds from the exercise of stock options were approximately $63,000 and $30,000 for the nine months ended September 30, 2013 and 2012, respectively. | ||||||||
The fair value of options granted during the nine months ended September 30, 2013 and 2012 was estimated using the Black-Scholes option pricing model with the following assumptions: | ||||||||
2013 | 2012 | |||||||
Dividend yield | 0 | % | 0 | % | ||||
Expected volatility | 43.9 | % | 41.8 | % | ||||
Expected life of option | Five Years | Five Years | ||||||
Risk-free interest rate | 0.7 | % | 0.8 | % | ||||
Fair value of each option on grant date | $ | 4.72 | $ | 2.73 | ||||
There were 4,250 and 750 options granted during the nine months ended September 30, 2013 and 2012, respectively. | ||||||||
Stock option activity during the nine months ended September 30, 2013 was as follows: | ||||||||
Weighted | ||||||||
Average | ||||||||
Exercise | ||||||||
Shares | Price | |||||||
Outstanding at beginning of period | 21,362 | $ | 6.72 | |||||
Granted | 4,250 | 12.56 | ||||||
Exercised | (10,361 | ) | 6.13 | |||||
Expired and forfeited | (500 | ) | 12.56 | |||||
Outstanding at September 30, 2013 | 14,751 | 8.62 | ||||||
Exercisable at September 30, 2013 | 7,499 | 7.1 | ||||||
The aggregate intrinsic value of all options outstanding and for those exercisable at September 30, 2013 was approximately $79,000 and $52,000, respectively. | ||||||||
Segment_Information
Segment Information | 9 Months Ended | ||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||
Segment Information | ' | ||||||||||||||||||||||
Segment Information | ' | ||||||||||||||||||||||
6. Segment Information | |||||||||||||||||||||||
The Company’s reportable segments are strategic business units that offer different products and have varied customer bases. There are five reportable segments: Domestic, Export, IKONICS Imaging, Digital Texturing (DTX) and Micro-Machining. Domestic sells screen printing film, emulsions, and inkjet receptive film to distributors located in the United States and Canada. IKONICS Imaging sells photo resistant film, art supplies, glass, metal medium and related abrasive etching equipment to end user customers located in the United States and Canada. Micro-Machining provides sound deadening technology to the aerospace industry along with products and services for etched composites, ceramics, glass and silicon wafers. DTX includes products and customers related to patented and proprietary inkjet technology used for mold texturing. Export sells primarily the same products as Domestic and the IKONICS Imaging products not related to Micro-Machining or DTX. In previous periods, the segment designated as Other included both Micro-Machining and DTX. Beginning in the third quarter of 2013, the Company began to report DTX and Micro-Machining as separate segments. The accounting policies applied to determine the segment information are consistent with those included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. | |||||||||||||||||||||||
Management evaluates the performance of each segment based on the components of divisional income, and does not allocate assets and liabilities to segments except for trade receivables which are allocated based on the previous segmentation. Financial information with respect to the reportable segments follows: | |||||||||||||||||||||||
For the three months ended September 30, 2013: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 1,881,210 | $ | 1,310,281 | $ | 874,442 | $ | 104,339 | $ | 46,853 | $ | — | $ | 4,217,125 | |||||||||
Cost of goods sold | 1,048,869 | 967,923 | 414,656 | 20,774 | 123,335 | — | 2,575,557 | ||||||||||||||||
Gross profit (loss) | 832,341 | 342,358 | 459,786 | 83,565 | (76,482 | ) | — | 1,641,568 | |||||||||||||||
Selling general and adminstrative* | 305,297 | 127,346 | 234,096 | 128,968 | 106,974 | 427,518 | 1,330,199 | ||||||||||||||||
Research and development* | — | — | — | — | — | 149,864 | 149,864 | ||||||||||||||||
Income (loss) from operations | $ | 527,044 | $ | 215,012 | $ | 225,690 | $ | (45,403 | ) | $ | (183,456 | ) | $ | (577,382 | ) | $ | 161,505 | ||||||
For the three months ended September 30, 2012: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 1,782,944 | $ | 1,256,669 | $ | 958,399 | $ | 100,879 | $ | 132,344 | $ | — | $ | 4,231,235 | |||||||||
Cost of goods sold | 1,009,697 | 920,397 | 426,750 | 9,928 | 111,586 | — | 2,478,358 | ||||||||||||||||
Gross profit | 773,247 | 336,272 | 531,649 | 90,951 | 20,758 | — | 1,752,877 | ||||||||||||||||
Selling general and adminstrative* | 283,567 | 141,599 | 284,113 | 144,333 | 69,101 | 350,573 | 1,273,286 | ||||||||||||||||
Research and development* | — | — | — | — | — | 141,186 | 141,186 | ||||||||||||||||
Income (loss) from operations | $ | 489,680 | $ | 194,673 | $ | 247,536 | $ | (53,382 | ) | $ | (48,343 | ) | $ | (491,759 | ) | $ | 338,405 | ||||||
For the nine months ended September 30, 2013: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 5,401,082 | $ | 4,249,218 | $ | 2,641,047 | $ | 333,656 | $ | 269,139 | $ | — | $ | 12,894,142 | |||||||||
Cost of goods sold | 3,057,814 | 3,112,063 | 1,316,453 | 57,323 | 360,704 | — | 7,904,357 | ||||||||||||||||
Gross profit (loss) | 2,343,268 | 1,137,155 | 1,324,594 | 276,333 | (91,565 | ) | — | 4,989,785 | |||||||||||||||
Selling general and adminstrative* | 972,656 | 448,380 | 773,629 | 340,711 | 328,346 | 1,261,079 | 4,124,801 | ||||||||||||||||
Research and development* | — | — | — | — | — | 475,791 | 475,791 | ||||||||||||||||
Income (loss) from operations | $ | 1,370,612 | $ | 688,775 | $ | 550,965 | $ | (64,378 | ) | $ | (419,911 | ) | $ | (1,736,870 | ) | $ | 389,193 | ||||||
For the nine months ended September 30, 2012: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 5,242,685 | $ | 4,125,540 | $ | 2,675,982 | $ | 347,747 | $ | 395,985 | $ | — | $ | 12,787,939 | |||||||||
Cost of goods sold | 2,978,651 | 3,056,401 | 1,256,245 | 103,366 | 331,553 | — | 7,726,216 | ||||||||||||||||
Gross profit | 2,264,034 | 1,069,139 | 1,419,737 | 244,381 | 64,432 | — | 5,061,723 | ||||||||||||||||
Selling general and adminstrative* | 882,977 | 464,705 | 881,276 | 374,888 | 234,568 | 1,146,440 | 3,984,854 | ||||||||||||||||
Research and development* | — | — | — | — | — | 470,165 | 470,165 | ||||||||||||||||
Income (loss) from operations | $ | 1,381,057 | $ | 604,434 | $ | 538,461 | $ | (130,507 | ) | $ | (170,136 | ) | $ | (1,616,605 | ) | $ | 606,704 | ||||||
* The Company does not allocate all general and administrative expenses or any research and development expenses to its operating segments for internal reporting. | |||||||||||||||||||||||
Trade receivables by segment as of September 30, 2013 and December 31, 2012 were as follows: | |||||||||||||||||||||||
30-Sep-13 | 31-Dec-12 | ||||||||||||||||||||||
Domestic | $ | 922,029 | $ | 928,698 | |||||||||||||||||||
Export | 649,256 | 708,933 | |||||||||||||||||||||
IKONICS Imaging | 252,229 | 272,346 | |||||||||||||||||||||
DTX | 45,666 | 117,552 | |||||||||||||||||||||
Micro-Machining | 27,477 | 57,122 | |||||||||||||||||||||
Unallocated | 3,057 | (24,339 | ) | ||||||||||||||||||||
Total | $ | 1,899,714 | $ | 2,060,312 | |||||||||||||||||||
SelfFunded_Medical_Insurance
Self-Funded Medical Insurance | 9 Months Ended |
Sep. 30, 2013 | |
Self-Funded Medical Insurance | ' |
Self-Funded Medical Insurance | ' |
7. Self-Funded Medical Insurance | |
The Company records estimates for claim liabilities based on information provided by the third-party administrators, historical claims experience, the life cycle of claims, expected costs of claims incurred but not paid, and expected costs to settle unpaid claims. The Company regularly monitors its estimated insurance-related liabilities. Actual claims experience may differ from the Company’s estimates. Costs related to the administration of the plan and related claims are expensed as incurred. The total liability for self-funded medical insurance was $45,000 as of September 30, 2013 and $54,000 as of December 31, 2012 and is included within other accrued expenses in the consolidated balance sheets. | |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2013 | |
Income Taxes | ' |
Income Taxes | ' |
8. Income Taxes | |
The Company reports a liability for unrecognized tax benefits taken or expected to be taken when they are uncertain. As of September 30, 2013 and 2012, there was no liability for unrecognized tax benefits. | |
The Company is subject to taxation in the United States and various states. The material jurisdictions that are subject to examination by tax authorities primarily include Minnesota and the United States, for tax years 2009, 2010, 2011, and 2012. | |
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventories | ' | |||||||
Schedule of major components of inventories | ' | |||||||
30-Sep-13 | 31-Dec-12 | |||||||
Raw materials | $ | 2,060,334 | $ | 2,072,540 | ||||
Work-in-progress | 408,041 | 373,512 | ||||||
Finished goods | 1,296,047 | 1,478,444 | ||||||
Reduction to LIFO cost | (1,248,724 | ) | (1,245,632 | ) | ||||
Total Inventory | $ | 2,515,698 | $ | 2,678,864 |
Earnings_Per_Common_Share_EPS_
Earnings Per Common Share (EPS) (Tables) | 9 Months Ended | |||||
Sep. 30, 2013 | ||||||
Earnings Per Common Share (EPS) | ' | |||||
Schedule of shares used in the calculation of diluted EPS | ' | |||||
Three Months Ended | ||||||
30-Sep-13 | 30-Sep-12 | |||||
Weighted average common shares outstanding | 2,008,836 | 1,989,307 | ||||
Dilutive effect of stock options | 6,289 | 4,122 | ||||
Weighted average common and common equivalent shares outstanding | 2,015,125 | 1,993,429 | ||||
Nine Months Ended | ||||||
30-Sep-13 | 30-Sep-12 | |||||
Weighted average common shares outstanding | 2,005,702 | 1,986,798 | ||||
Dilutive effect of stock options | 4,632 | 3,687 | ||||
Weighted average common and common equivalent shares outstanding | 2,010,334 | 1,990,485 |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Stock-Based Compensation | ' | |||||||
Assumptions used in estimating fair value of stock options | ' | |||||||
2013 | 2012 | |||||||
Dividend yield | 0 | % | 0 | % | ||||
Expected volatility | 43.9 | % | 41.8 | % | ||||
Expected life of option | Five Years | Five Years | ||||||
Risk-free interest rate | 0.7 | % | 0.8 | % | ||||
Fair value of each option on grant date | $ | 4.72 | $ | 2.73 | ||||
Stock option activity | ' | |||||||
Weighted | ||||||||
Average | ||||||||
Exercise | ||||||||
Shares | Price | |||||||
Outstanding at beginning of period | 21,362 | $ | 6.72 | |||||
Granted | 4,250 | 12.56 | ||||||
Exercised | (10,361 | ) | 6.13 | |||||
Expired and forfeited | (500 | ) | 12.56 | |||||
Outstanding at September 30, 2013 | 14,751 | 8.62 | ||||||
Exercisable at September 30, 2013 | 7,499 | 7.1 | ||||||
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | ||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||
Segment Information | ' | ||||||||||||||||||||||
Schedule of financial information with respect to the reportable segments | ' | ||||||||||||||||||||||
For the three months ended September 30, 2013: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 1,881,210 | $ | 1,310,281 | $ | 874,442 | $ | 104,339 | $ | 46,853 | $ | — | $ | 4,217,125 | |||||||||
Cost of goods sold | 1,048,869 | 967,923 | 414,656 | 20,774 | 123,335 | — | 2,575,557 | ||||||||||||||||
Gross profit (loss) | 832,341 | 342,358 | 459,786 | 83,565 | (76,482 | ) | — | 1,641,568 | |||||||||||||||
Selling general and adminstrative* | 305,297 | 127,346 | 234,096 | 128,968 | 106,974 | 427,518 | 1,330,199 | ||||||||||||||||
Research and development* | — | — | — | — | — | 149,864 | 149,864 | ||||||||||||||||
Income (loss) from operations | $ | 527,044 | $ | 215,012 | $ | 225,690 | $ | (45,403 | ) | $ | (183,456 | ) | $ | (577,382 | ) | $ | 161,505 | ||||||
For the three months ended September 30, 2012: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 1,782,944 | $ | 1,256,669 | $ | 958,399 | $ | 100,879 | $ | 132,344 | $ | — | $ | 4,231,235 | |||||||||
Cost of goods sold | 1,009,697 | 920,397 | 426,750 | 9,928 | 111,586 | — | 2,478,358 | ||||||||||||||||
Gross profit | 773,247 | 336,272 | 531,649 | 90,951 | 20,758 | — | 1,752,877 | ||||||||||||||||
Selling general and adminstrative* | 283,567 | 141,599 | 284,113 | 144,333 | 69,101 | 350,573 | 1,273,286 | ||||||||||||||||
Research and development* | — | — | — | — | — | 141,186 | 141,186 | ||||||||||||||||
Income (loss) from operations | $ | 489,680 | $ | 194,673 | $ | 247,536 | $ | (53,382 | ) | $ | (48,343 | ) | $ | (491,759 | ) | $ | 338,405 | ||||||
For the nine months ended September 30, 2013: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 5,401,082 | $ | 4,249,218 | $ | 2,641,047 | $ | 333,656 | $ | 269,139 | $ | — | $ | 12,894,142 | |||||||||
Cost of goods sold | 3,057,814 | 3,112,063 | 1,316,453 | 57,323 | 360,704 | — | 7,904,357 | ||||||||||||||||
Gross profit (loss) | 2,343,268 | 1,137,155 | 1,324,594 | 276,333 | (91,565 | ) | — | 4,989,785 | |||||||||||||||
Selling general and adminstrative* | 972,656 | 448,380 | 773,629 | 340,711 | 328,346 | 1,261,079 | 4,124,801 | ||||||||||||||||
Research and development* | — | — | — | — | — | 475,791 | 475,791 | ||||||||||||||||
Income (loss) from operations | $ | 1,370,612 | $ | 688,775 | $ | 550,965 | $ | (64,378 | ) | $ | (419,911 | ) | $ | (1,736,870 | ) | $ | 389,193 | ||||||
For the nine months ended September 30, 2012: | |||||||||||||||||||||||
IKONICS | Micro- | ||||||||||||||||||||||
Domestic | Export | Imaging | DTX | Machining | Unalloc. | Total | |||||||||||||||||
Net sales | $ | 5,242,685 | $ | 4,125,540 | $ | 2,675,982 | $ | 347,747 | $ | 395,985 | $ | — | $ | 12,787,939 | |||||||||
Cost of goods sold | 2,978,651 | 3,056,401 | 1,256,245 | 103,366 | 331,553 | — | 7,726,216 | ||||||||||||||||
Gross profit | 2,264,034 | 1,069,139 | 1,419,737 | 244,381 | 64,432 | — | 5,061,723 | ||||||||||||||||
Selling general and adminstrative* | 882,977 | 464,705 | 881,276 | 374,888 | 234,568 | 1,146,440 | 3,984,854 | ||||||||||||||||
Research and development* | — | — | — | — | — | 470,165 | 470,165 | ||||||||||||||||
Income (loss) from operations | $ | 1,381,057 | $ | 604,434 | $ | 538,461 | $ | (130,507 | ) | $ | (170,136 | ) | $ | (1,616,605 | ) | $ | 606,704 | ||||||
* The Company does not allocate all general and administrative expenses or any research and development expenses to its operating segments for internal reporting. | |||||||||||||||||||||||
Schedule of trade receivables by segment | ' | ||||||||||||||||||||||
30-Sep-13 | 31-Dec-12 | ||||||||||||||||||||||
Domestic | $ | 922,029 | $ | 928,698 | |||||||||||||||||||
Export | 649,256 | 708,933 | |||||||||||||||||||||
IKONICS Imaging | 252,229 | 272,346 | |||||||||||||||||||||
DTX | 45,666 | 117,552 | |||||||||||||||||||||
Micro-Machining | 27,477 | 57,122 | |||||||||||||||||||||
Unallocated | 3,057 | (24,339 | ) | ||||||||||||||||||||
Total | $ | 1,899,714 | $ | 2,060,312 |
ShortTerm_Investments_Details
Short-Term Investments (Details) (Certificates of deposit, USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Short-term investments | ' |
Fully insured certificates of deposit | 1,815,000 |
Minimum | ' |
Short-term investments | ' |
Maturity period | '3 months |
Interest rate (as a percent) | 0.20% |
Maximum | ' |
Short-term investments | ' |
Maturity period | '12 months |
Interest rate (as a percent) | 1.00% |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Inventories | ' | ' |
Raw materials | $2,060,334 | $2,072,540 |
Work-in-progress | 408,041 | 373,512 |
Finished goods | 1,296,047 | 1,478,444 |
Reduction to LIFO cost | -1,248,724 | -1,245,632 |
Total Inventory | $2,515,698 | $2,678,864 |
Earnings_Per_Common_Share_EPS_1
Earnings Per Common Share (EPS) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Shares used in calculation of diluted EPS | ' | ' | ' | ' |
Weighted average common shares outstanding | 2,008,836 | 1,989,307 | 2,005,702 | 1,986,798 |
Dilutive effect of stock options | 6,289 | 4,122 | 4,632 | 3,687 |
Weighted average common and common equivalent shares outstanding | 2,015,125 | 1,993,429 | 2,010,334 | 1,990,485 |
Stock options | ' | ' | ' | ' |
Anti-dilutive securities | ' | ' | ' | ' |
Anti-dilutive securities outstanding (in shares) | 0 | 0 | 0 | 0 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Stock options | ' | ' | ' | ' | ' |
Number of shares of common stock authorized for issuance | 442,750 | ' | 442,750 | ' | ' |
Excess tax benefit from exercise of stock option | $0 | $0 | $0 | $0 | ' |
Total of Company's APIC pool | ' | ' | 111,000 | ' | 111,000 |
Proceeds from the exercise of stock | ' | ' | 63,492 | 30,123 | ' |
Stock Options | ' | ' | ' | ' | ' |
Stock options | ' | ' | ' | ' | ' |
Outstanding options (in shares) | 14,751 | ' | 14,751 | ' | 21,362 |
Common stock reserved for future grants (in shares) | 115,573 | ' | 115,573 | ' | ' |
Compensation cost recognized | 3,800 | 4,400 | 10,100 | 13,400 | ' |
Unrecognized compensation cost | 24,000 | ' | 24,000 | ' | ' |
Period during which compensation cost is expected to be recognized | ' | ' | '3 years | ' | ' |
Proceeds from the exercise of stock | ' | ' | $63,000 | $30,000 | ' |
Stock Options | Minimum | ' | ' | ' | ' | ' |
Stock options | ' | ' | ' | ' | ' |
Option price range(as a percent) | ' | ' | 85.00% | ' | ' |
Period over which options become exercisable | ' | ' | '1 year | ' | ' |
Stock Options | Maximum | ' | ' | ' | ' | ' |
Stock options | ' | ' | ' | ' | ' |
Option price range(as a percent) | ' | ' | 110.00% | ' | ' |
Expiration period of options granted | ' | ' | '7 years | ' | ' |
Period over which options become exercisable | ' | ' | '3 years | ' | ' |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 2) (Stock Options, USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Stock Options | ' | ' |
Assumptions used to determine fair value of stock options granted | ' | ' |
Dividend yield (as a percent) | 0.00% | 0.00% |
Expected volatility (as a percent) | 43.90% | 41.80% |
Expected life of option | '5 years | '5 years |
Risk-free interest rate (as a percent) | 0.70% | 0.80% |
Fair value of each option on grant date (in dollars per share) | $4.72 | $2.73 |
Granted (in shares) | 4,250 | 750 |
Shares | ' | ' |
Outstanding at beginning of period (in shares) | 21,362 | ' |
Granted (in shares) | 4,250 | 750 |
Exercised (in shares) | -10,361 | ' |
Expired and forfeited (in shares) | -500 | ' |
Outstanding at end of period (in shares) | 14,751 | ' |
Exercisable at end of period (in shares) | 7,499 | ' |
Weighted Average Exercise Price | ' | ' |
Outstanding at beginning of period (in dollars per share) | $6.72 | ' |
Granted (in dollars per share) | $12.56 | ' |
Exercised (in dollars per share) | $6.13 | ' |
Expired and forfeited (in dollars per share) | $12.56 | ' |
Outstanding at end of period (in dollars per share) | $8.62 | ' |
Exercisable at end of period (in dollars per share) | $7.10 | ' |
Aggregate intrinsic value of all options outstanding | $79,000 | ' |
Aggregate intrinsic value of all options exercisable | $52,000 | ' |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
item | |||||
Segment Reporting Information | ' | ' | ' | ' | ' |
Number of reportable segments | ' | ' | 5 | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | $4,217,125 | $4,231,235 | $12,894,142 | $12,787,939 | ' |
Cost of goods sold | 2,575,557 | 2,478,358 | 7,904,357 | 7,726,216 | ' |
GROSS PROFIT | 1,641,568 | 1,752,877 | 4,989,785 | 5,061,723 | ' |
Selling general and administrative | 1,330,199 | 1,273,286 | 4,124,801 | 3,984,854 | ' |
Research and development | 149,864 | 141,186 | 475,791 | 470,165 | ' |
INCOME FROM OPERATIONS | 161,505 | 338,405 | 389,193 | 606,704 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 1,899,714 | ' | 1,899,714 | ' | 2,060,312 |
Unalloc. | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Selling general and administrative | 427,518 | 350,573 | 1,261,079 | 1,146,440 | ' |
Research and development | 149,864 | 141,186 | 475,791 | 470,165 | ' |
INCOME FROM OPERATIONS | -577,382 | -491,759 | -1,736,870 | -1,616,605 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 3,057 | ' | 3,057 | ' | -24,339 |
Domestic | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | 1,881,210 | 1,782,944 | 5,401,082 | 5,242,685 | ' |
Cost of goods sold | 1,048,869 | 1,009,697 | 3,057,814 | 2,978,651 | ' |
GROSS PROFIT | 832,341 | 773,247 | 2,343,268 | 2,264,034 | ' |
Selling general and administrative | 305,297 | 283,567 | 972,656 | 882,977 | ' |
INCOME FROM OPERATIONS | 527,044 | 489,680 | 1,370,612 | 1,381,057 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 922,029 | ' | 922,029 | ' | 928,698 |
Export | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | 1,310,281 | 1,256,669 | 4,249,218 | 4,125,540 | ' |
Cost of goods sold | 967,923 | 920,397 | 3,112,063 | 3,056,401 | ' |
GROSS PROFIT | 342,358 | 336,272 | 1,137,155 | 1,069,139 | ' |
Selling general and administrative | 127,346 | 141,599 | 448,380 | 464,705 | ' |
INCOME FROM OPERATIONS | 215,012 | 194,673 | 688,775 | 604,434 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 649,256 | ' | 649,256 | ' | 708,933 |
IKONICS Imaging | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | 874,442 | 958,399 | 2,641,047 | 2,675,982 | ' |
Cost of goods sold | 414,656 | 426,750 | 1,316,453 | 1,256,245 | ' |
GROSS PROFIT | 459,786 | 531,649 | 1,324,594 | 1,419,737 | ' |
Selling general and administrative | 234,096 | 284,113 | 773,629 | 881,276 | ' |
INCOME FROM OPERATIONS | 225,690 | 247,536 | 550,965 | 538,461 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 252,229 | ' | 252,229 | ' | 272,346 |
DTX | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | 104,339 | 100,879 | 333,656 | 347,747 | ' |
Cost of goods sold | 20,774 | 9,928 | 57,323 | 103,366 | ' |
GROSS PROFIT | 83,565 | 90,951 | 276,333 | 244,381 | ' |
Selling general and administrative | 128,968 | 144,333 | 340,711 | 374,888 | ' |
INCOME FROM OPERATIONS | -45,403 | -53,382 | -64,378 | -130,507 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | 45,666 | ' | 45,666 | ' | 117,552 |
Micro-Machining | ' | ' | ' | ' | ' |
Financial information with respect to the reportable segments | ' | ' | ' | ' | ' |
Net sales | 46,853 | 132,344 | 269,139 | 395,985 | ' |
Cost of goods sold | 123,335 | 111,586 | 360,704 | 331,553 | ' |
GROSS PROFIT | -76,482 | 20,758 | -91,565 | 64,432 | ' |
Selling general and administrative | 106,974 | 69,101 | 328,346 | 234,568 | ' |
INCOME FROM OPERATIONS | -183,456 | -48,343 | -419,911 | -170,136 | ' |
Trade receivables by segment | ' | ' | ' | ' | ' |
Trade receivables | $27,477 | ' | $27,477 | ' | $57,122 |
SelfFunded_Medical_Insurance_D
Self-Funded Medical Insurance (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Self-Funded Medical Insurance | ' | ' |
Total liability for self-funded medical insurance | $45,000 | $54,000 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | Sep. 30, 2013 | Sep. 30, 2012 |
Income Taxes | ' | ' |
Unrecognized tax benefits | $0 | $0 |