Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2020 | Aug. 07, 2020 | |
Document Information [Line Items] | ||
Entity Registrant Name | IKONICS CORP | |
Entity Central Index Key | 0001083301 | |
Trading Symbol | iknx | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Interactive Data Current | Yes | |
Entity Common Stock, Shares Outstanding (in shares) | 1,976,354 | |
Entity Shell Company | false | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Title of 12(b) Security | Common Stock, par value $.10 per share |
Condensed Balance Sheets (Curre
Condensed Balance Sheets (Current Period Unaudited) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 2,978,109 | $ 963,649 |
Short-term investments | 2,205,000 | |
Trade receivables, less allowance of $129,000 in 2020 and $58,000 in 2019 | 1,414,019 | 2,434,718 |
Inventories | 2,681,940 | 2,180,536 |
Prepaid expenses and other assets | 157,840 | 906,916 |
Income taxes receivable | 248,380 | 1,369 |
Total current assets | 7,480,288 | 8,692,188 |
PROPERTY, PLANT, AND EQUIPMENT, at cost: | ||
Land and building | 9,556,585 | 9,556,984 |
Machinery and equipment | 5,285,503 | 5,198,784 |
Office equipment | 1,440,964 | 1,402,369 |
Vehicles | 245,674 | 245,674 |
Property, plant, and equipment, Gross | 16,528,726 | 16,403,811 |
Less accumulated depreciation | (8,814,234) | (8,487,827) |
Total property, plant and equipment at cost, net | 7,714,492 | 7,915,984 |
INTANGIBLE ASSETS, less accumulated amortization of $194,731 in 2020 and $181,609 in 2019 | 253,824 | 271,369 |
Total assets | 15,448,604 | 16,879,541 |
CURRENT LIABILITIES | ||
Current portion of long-term debt | 3,288,361 | 133,287 |
Accounts payable | 315,224 | 761,641 |
Accrued compensation | 414,638 | 382,303 |
Other accrued liabilities | 113,306 | 657,255 |
Total current liabilities | 4,131,529 | 1,934,486 |
LONG-TERM LIABILITIES | ||
Long-term debt, less current portion | 681,510 | 2,688,357 |
Total liabilities | 4,813,039 | 4,622,843 |
COMMITMENTS AND CONTINGENCIES | ||
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 1,976,354 shares in 2020 and 2019. | 197,635 | 197,635 |
Additional paid-in-capital | 2,729,338 | 2,721,962 |
Retained earnings | 7,708,592 | 9,337,101 |
Total stockholders' equity | 10,635,565 | 12,256,698 |
Total liabilities and stockholders' equity | $ 15,448,604 | $ 16,879,541 |
Condensed Balance Sheets (Cur_2
Condensed Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Trade receivables, allowances | $ 129,000 | $ 58,000 |
Intangible assets, accumulated amortization | $ 194,731 | $ 181,609 |
Preferred stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Preferred stock, authorized (in shares) | 250,000 | 250,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Common stock, shares authorized (in shares) | 4,750,000 | 4,750,000 |
Common stock, share issued (in shares) | 1,976,354 | 1,976,354 |
Common stock, share outstanding (in shares) | 1,976,354 | 1,976,354 |
Condensed Statements of Operati
Condensed Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Net sales | $ 2,572,439 | $ 4,596,411 | $ 6,069,631 | $ 8,125,102 | |
Cost of goods sold | 2,187,544 | 3,167,982 | 4,531,504 | 5,687,554 | |
GROSS PROFIT | 384,895 | 1,428,429 | 1,538,127 | 2,437,548 | |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | [1] | 1,202,307 | 1,338,861 | 2,983,327 | 2,720,826 |
RESEARCH AND DEVELOPMENT EXPENSES | [1] | 201,234 | 270,465 | 384,814 | 449,307 |
LOSS FROM OPERATIONS | (1,018,646) | (180,897) | (1,830,014) | (732,585) | |
INTEREST EXPENSE | (24,623) | (22,515) | (46,107) | (44,790) | |
OTHER INCOME | 1,766 | 17,303 | 8,683 | 33,497 | |
LOSS BEFORE INCOME TAXES | (1,041,503) | (186,109) | (1,867,438) | (743,878) | |
INCOME TAX BENEFIT | 0 | (70,398) | (238,929) | (173,136) | |
NET LOSS | $ (1,041,503) | $ (115,711) | $ (1,628,509) | $ (570,742) | |
LOSS PER COMMON SHARE | |||||
Basic (in dollars per share) | $ (0.53) | $ (0.06) | $ (0.82) | $ (0.29) | |
Diluted (in dollars per share) | $ (0.53) | $ (0.06) | $ (0.82) | $ (0.29) | |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||
Basic (in shares) | 1,976,354 | 1,982,275 | 1,976,354 | 1,982,910 | |
Diluted (in shares) | 1,976,354 | 1,982,275 | 1,976,354 | 1,982,910 | |
[1] | The Company does not allocate all selling, general and administrative expenses or any research and development expenses to its operating segments for internal reporting. |
Statements of Stockholders' Equ
Statements of Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Total |
BALANCE (in shares) at Dec. 31, 2018 | 1,983,553 | |||
BALANCE at Dec. 31, 2018 | $ 198,355 | $ 2,723,024 | $ 10,189,651 | $ 13,111,030 |
Net loss | (570,742) | (570,742) | ||
Stock based compensation | 3,840 | 3,840 | ||
Common stock repurchased (in shares) | (2,742) | |||
Common stock repurchased | $ (274) | (3,765) | (16,930) | (20,969) |
BALANCE (in shares) at Jun. 30, 2019 | 1,980,811 | |||
BALANCE at Jun. 30, 2019 | $ 198,081 | 2,723,099 | 9,601,979 | 12,523,159 |
BALANCE (in shares) at Mar. 31, 2019 | 1,983,553 | |||
BALANCE at Mar. 31, 2019 | $ 198,355 | 2,724,944 | 9,734,620 | 12,657,919 |
Net loss | (115,711) | (115,711) | ||
Stock based compensation | 1,920 | 1,920 | ||
Common stock repurchased (in shares) | (2,742) | |||
Common stock repurchased | $ (274) | (3,765) | (16,930) | (20,969) |
BALANCE (in shares) at Jun. 30, 2019 | 1,980,811 | |||
BALANCE at Jun. 30, 2019 | $ 198,081 | 2,723,099 | 9,601,979 | $ 12,523,159 |
BALANCE (in shares) at Dec. 31, 2019 | 1,976,354 | 1,976,354 | ||
BALANCE at Dec. 31, 2019 | $ 197,635 | 2,721,962 | 9,337,101 | $ 12,256,698 |
Net loss | (1,628,509) | (1,628,509) | ||
Stock based compensation | 7,376 | $ 7,376 | ||
BALANCE (in shares) at Jun. 30, 2020 | 1,976,354 | 1,976,354 | ||
BALANCE at Jun. 30, 2020 | $ 197,635 | 2,729,338 | 7,708,592 | $ 10,635,565 |
BALANCE (in shares) at Mar. 31, 2020 | 1,976,354 | |||
BALANCE at Mar. 31, 2020 | $ 197,635 | 2,725,650 | 8,750,095 | 11,673,380 |
Net loss | (1,041,503) | (1,041,503) | ||
Stock based compensation | 3,688 | $ 3,688 | ||
BALANCE (in shares) at Jun. 30, 2020 | 1,976,354 | 1,976,354 | ||
BALANCE at Jun. 30, 2020 | $ 197,635 | $ 2,729,338 | $ 7,708,592 | $ 10,635,565 |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (1,628,509) | $ (570,742) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation | 335,435 | 321,062 |
Amortization | 18,452 | 24,308 |
Stock based compensation | 7,376 | 3,840 |
Net gain on sale and disposal of equipment | (2,324) | (8,481) |
Loss on intangible asset abandonment | 16,906 | 71,600 |
Changes in working capital components: | ||
Trade receivables | 1,020,699 | (8,230) |
Inventories | (501,404) | (465,661) |
Prepaid expenses and other assets | 749,076 | 113,037 |
Income tax receivable | (247,011) | (182,451) |
Accounts payable | (446,417) | (114,104) |
Accrued expenses | (511,614) | 46,897 |
Net cash used in operating activities | (1,189,335) | (768,925) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (149,916) | (230,570) |
Proceeds from sales of equipment | 18,297 | 15,596 |
Purchases of intangible assets | (12,483) | (6,322) |
Purchases of short-term investments | (3,185,000) | |
Proceeds on sale of short-term investments | 2,205,000 | 2,940,000 |
Net cash provided by (used in) investing activities | 2,060,898 | (466,296) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from debt | 1,214,500 | |
Payment on long-term debt | (71,603) | (69,761) |
Repurchase of common stock | (20,969) | |
Net cash provided by (used in) financing activities | 1,142,897 | (90,730) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 2,014,460 | (1,325,951) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 963,649 | 1,623,137 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 2,978,109 | 297,186 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for interest | 37,998 | 39,812 |
Cash paid for income taxes, net | $ 8,082 | $ 9,315 |
Note 1 - Basis of Presentation
Note 1 - Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1. Basis of Presentation The condensed balance sheet of IKONICS Corporation (the “Company”) as of June 30, 2020, three six June 30, 2020 2019, three six June 30, 2020 2019, six June 30, 2020 2019, 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 June 30, 2020, 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 December 31, 2019. The results of operations for interim periods are not The Company relies on cash flow generated from operations and available borrowings under its bank line of credit to fund its working capital and other operating and investing needs. The Company's ability to borrow under the bank line of credit is based on its continued compliance with its debt service coverage ratio covenant, as defined. The full extent of the effect of the COVID- 19 2020 19 19 Based on the Company's current cash position, and expected future cash flows, the Company believes it will have sufficient cash to funds its operations beyond twelve The Company has evaluated subsequent events occurring after the date of the financial statements for events requiring recording or disclosure in the financial statements. As a result of the novel strain of COVID- 19 |
Note 2 - Inventories
Note 2 - Inventories | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Inventory Disclosure [Text Block] | 2. Inventories The major components of inventories as of June 30, 2020 December 31, 2019 Jun 30, 2020 Dec 31, 2019 Raw materials $ 1,511,629 $ 1,667,154 Work-in-progress 475,194 419,906 Finished goods 2,013,510 1,449,854 Reduction to LIFO cost (1,318,393 ) (1,356,378 ) Total Inventories $ 2,681,940 $ 2,180,536 |
Note 3 - Earnings Per Common Sh
Note 3 - Earnings Per Common Share (EPS) | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Earnings Per Share [Text Block] | 3. Earnings Per Common Share (EPS) Basic EPS is calculated using net loss divided by the weighted average of common shares outstanding. Diluted EPS is calculated similarly 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. The options disclosed in Note 5 Shares used in the calculation of diluted EPS are summarized below: Three Months Ended Jun 30, 2020 Jun 30, 2019 Weighted average common shares outstanding 1,976,354 1,982,275 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,976,354 1,982,275 Six Months Ended Jun 30, 2020 Jun 30, 2019 Weighted average common shares outstanding 1,976,354 1,982,910 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,976,354 1,982,910 If the Company was in a net income position for the three six June 30, 2020, 21,500 $7.38 If the Company was in a net income position for the three six June 30, 2019, 16,000 $12.17 |
Note 4 - Stock-based Compensati
Note 4 - Stock-based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Share-based Payment Arrangement [Text Block] | 4. Stock-Based Compensation The Company maintains the 2019 “2019 2019 1995 "1995 April 2019. 1995 442,750 8,250 June 30, 2020. 1995 2019 102,157 1995 no Under the terms of the 2019 may 2019 102,157. 2019 8,500 1995 2019 2019 2019 110,657. June 30, 2020, 13,250 2019 The Company charged compensation cost of approximately $7,400 six June 30, 2020 $3,800 six June 30, 2019. June 30, 2020, $33,700 three 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 additional paid in capital and reduces income taxes payable. No six June 30, 2020 June 30, 2019. There were 10,000 six June 30, 2020 no six June 30, 2019. six June 30, 2020 2020 Dividend yield 0 Expected volatility 40.3 % Expected life of option (years) 10 Risk-free interest rate 1.4 % Fair value of each option on grant date $ 2.90 Stock option activity during the six June 30, 2020 Weighted Average Exercise Shares Price Outstanding at January 1, 2020 19,250 $ 11.32 Granted 10,000 5.67 Exercised — — Expired and forfeited (7,750 ) 14.96 Outstanding at June 30, 2020 21,500 $ 7.38 Exercisable at June 30, 2020 7,333 $ 9.66 There was not June 30, 2020. |
Note 5 - Segment Information
Note 5 - Segment Information | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | 5. Segment Information The Company's reportable segments are strategic business units that offer different products and have varied customer bases. There are four 10 December 31, 2019. Management evaluates the performance of each segment based on the components of divisional income (loss). Assets and liabilities are not For the three June 30, 2020: IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 1,619,986 $ 625,800 $ 49,053 $ 277,600 $ — $ 2,572,439 Cost of goods sold 1,407,362 419,985 24,346 335,851 — 2,187,544 Gross profit (loss) 212,624 205,815 24,707 (58,251 ) — 384,895 Selling general and administrative* 366,136 224,573 30,059 57,035 524,504 1,202,307 Research and development* — — — — 201,234 201,234 Loss from operations $ (153,512 ) $ (18,758 ) $ (5,352 ) $ (115,286 ) $ (725,738 ) $ (1,018,646 ) For the three June 30, 2019: IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 3,107,116 $ 958,128 $ 112,601 $ 418,566 $ — $ 4,596,411 Cost of goods sold 2,280,224 501,006 51,547 335,205 — 3,167,982 Gross profit 826,892 457,122 61,054 83,361 — 1,428,429 Selling general and administrative* 467,091 248,050 34,761 88,362 500,597 1,338,861 Research and development* — — — — 270,465 270,465 Income (loss) from operations $ 359,801 $ 209,072 $ 26,293 $ (5,001 ) $ (771,062 ) $ (180,897 ) For the six June 30, 2020: IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 3,584,326 $ 1,595,899 $ 161,582 $ 727,824 $ — $ 6,069,631 Cost of goods sold 2,825,631 897,708 76,092 732,073 — 4,531,504 Gross profit (loss) 758,695 698,191 85,490 (4,249 ) — 1,538,127 Selling general and administrative* 792,355 503,435 64,432 160,144 1,462,961 2,983,327 Research and development* — — — — 384,814 384,814 Income (loss) from operations $ (33,660 ) $ 194,756 $ 21,058 $ (164,393 ) $ (1,847,775 ) $ (1,830,014 ) For the six June 30, 2019: IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 5,136,457 $ 2,046,934 $ 205,361 $ 736,350 $ — $ 8,125,102 Cost of goods sold 3,833,834 1,086,510 85,593 681,617 — 5,687,554 Gross profit 1,302,623 960,424 119,768 54,733 — 2,437,548 Selling general and administrative* 912,094 570,503 69,366 176,510 992,353 2,720,826 Research and development* — — — — 449,307 449,307 Income (loss) from operations $ 390,529 $ 389,921 $ 50,402 $ (121,777 ) $ (1,441,660 ) $ (732,585 ) *The Company does not Trade receivables by segment as of June 30, 2020 December 31, 2019 Jun 30, 2020 Dec 31, 2019 Chromaline $ 1,097,348 $ 1,916,066 IKONICS Imaging 193,653 304,791 DTX 38,912 13,919 AMS 182,333 252,363 Unallocated (98,227 ) (52,421 ) Total $ 1,414,019 $ 2,434,718 |
Note 6 - Income Taxes
Note 6 - Income Taxes | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Income Tax Disclosure [Text Block] | 6. Income Taxes The Company records its interim provision for income taxes by applying its estimated annual effective tax rate to the year-to-date pre-tax income and adjusting for discrete tax items recorded in the period. Deferred income taxes result from temporary differences between the reporting of amounts for financial statement purposes and income tax purposes. These differences relate primarily to different methods used for income tax reporting purposes, including for depreciation and amortization, warranty and vacation accruals, and deductions related to allowances for doubtful accounts receivable and inventory reserves. The provision for income taxes included current federal and state income tax expense, as well as deferred federal and state income tax expense. Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three June 30, 2020. On the basis of this evaluation, as of June 30, 2020, not may no On March 27, 2020, 19 2018, 2019, 2020 five The effective tax rate for the three June 30, 2020 0.0%, 37.8% three June 30, 2019. third 2019. $0 $70,000 three June 30, 2020 2019, The effective tax rate for the six June 30, 2020 12.8%, 23.3% six June 30, 2019. $239,000 $173,000 six June 30, 2020 2019, The Company recognized the financial statement benefit of a tax position only after determining that the relevant tax authority is more-likely -than- not not 50% June 30, 2020, no This Company is not |
Note 7 - Long-term Debt
Note 7 - Long-term Debt | 6 Months Ended |
Jun. 30, 2020 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | 7. Long-Term Debt Duluth Economic Development Authority Loan On April 1, 2016, $3,415,000 2016 The Company is subject to certain customary covenants set forth in the associated covenant agreement, including a requirement that the Company maintain a debt service coverage ratio of not 1.25 1.00. December 31, 2019, not February 2020 March 31, 2020. no 2016 April 2020. June 30, 2020 Paycheck Protection Program Loan On April 18, 2020, $1,214,500 April 22, 2020, The PPP Loan matures on the two 1.00% six not may All or a portion of the PPP Loan may eight $100,000, Not 40% may $100,000 25%. The Company accounts for the PPP Loan as debt in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 470, 835 30. Line of Credit The Company also has a bank line of credit providing for borrowings of up to $2,050,000 August 30, 2021 1.8 30 not first six 2020 2019 no June 30, 2020 December 31, 2019. no Both the $3,415,000 |
Note 2 - Inventories (Tables)
Note 2 - Inventories (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Notes Tables | |
Schedule of Inventory, Current [Table Text Block] | Jun 30, 2020 Dec 31, 2019 Raw materials $ 1,511,629 $ 1,667,154 Work-in-progress 475,194 419,906 Finished goods 2,013,510 1,449,854 Reduction to LIFO cost (1,318,393 ) (1,356,378 ) Total Inventories $ 2,681,940 $ 2,180,536 |
Note 3 - Earnings Per Common _2
Note 3 - Earnings Per Common Share (EPS) (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Notes Tables | |
Schedule of Weighted Average Number of Shares [Table Text Block] | Three Months Ended Jun 30, 2020 Jun 30, 2019 Weighted average common shares outstanding 1,976,354 1,982,275 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,976,354 1,982,275 Six Months Ended Jun 30, 2020 Jun 30, 2019 Weighted average common shares outstanding 1,976,354 1,982,910 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,976,354 1,982,910 |
Note 4 - Stock-based Compensa_2
Note 4 - Stock-based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Notes Tables | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | 2020 Dividend yield 0 Expected volatility 40.3 % Expected life of option (years) 10 Risk-free interest rate 1.4 % Fair value of each option on grant date $ 2.90 |
Share-based Payment Arrangement, Option, Activity [Table Text Block] | Weighted Average Exercise Shares Price Outstanding at January 1, 2020 19,250 $ 11.32 Granted 10,000 5.67 Exercised — — Expired and forfeited (7,750 ) 14.96 Outstanding at June 30, 2020 21,500 $ 7.38 Exercisable at June 30, 2020 7,333 $ 9.66 |
Note 5 - Segment Information (T
Note 5 - Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 1,619,986 $ 625,800 $ 49,053 $ 277,600 $ — $ 2,572,439 Cost of goods sold 1,407,362 419,985 24,346 335,851 — 2,187,544 Gross profit (loss) 212,624 205,815 24,707 (58,251 ) — 384,895 Selling general and administrative* 366,136 224,573 30,059 57,035 524,504 1,202,307 Research and development* — — — — 201,234 201,234 Loss from operations $ (153,512 ) $ (18,758 ) $ (5,352 ) $ (115,286 ) $ (725,738 ) $ (1,018,646 ) IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 3,107,116 $ 958,128 $ 112,601 $ 418,566 $ — $ 4,596,411 Cost of goods sold 2,280,224 501,006 51,547 335,205 — 3,167,982 Gross profit 826,892 457,122 61,054 83,361 — 1,428,429 Selling general and administrative* 467,091 248,050 34,761 88,362 500,597 1,338,861 Research and development* — — — — 270,465 270,465 Income (loss) from operations $ 359,801 $ 209,072 $ 26,293 $ (5,001 ) $ (771,062 ) $ (180,897 ) IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 3,584,326 $ 1,595,899 $ 161,582 $ 727,824 $ — $ 6,069,631 Cost of goods sold 2,825,631 897,708 76,092 732,073 — 4,531,504 Gross profit (loss) 758,695 698,191 85,490 (4,249 ) — 1,538,127 Selling general and administrative* 792,355 503,435 64,432 160,144 1,462,961 2,983,327 Research and development* — — — — 384,814 384,814 Income (loss) from operations $ (33,660 ) $ 194,756 $ 21,058 $ (164,393 ) $ (1,847,775 ) $ (1,830,014 ) IKONICS IKONICS Chromaline Imaging DTX AMS Unalloc. Total Net sales $ 5,136,457 $ 2,046,934 $ 205,361 $ 736,350 $ — $ 8,125,102 Cost of goods sold 3,833,834 1,086,510 85,593 681,617 — 5,687,554 Gross profit 1,302,623 960,424 119,768 54,733 — 2,437,548 Selling general and administrative* 912,094 570,503 69,366 176,510 992,353 2,720,826 Research and development* — — — — 449,307 449,307 Income (loss) from operations $ 390,529 $ 389,921 $ 50,402 $ (121,777 ) $ (1,441,660 ) $ (732,585 ) Jun 30, 2020 Dec 31, 2019 Chromaline $ 1,097,348 $ 1,916,066 IKONICS Imaging 193,653 304,791 DTX 38,912 13,919 AMS 182,333 252,363 Unallocated (98,227 ) (52,421 ) Total $ 1,414,019 $ 2,434,718 |
Note 2 - Inventories - Major Co
Note 2 - Inventories - Major Components of Inventories (Details) - USD ($) | Jun. 30, 2020 | Dec. 31, 2019 |
Raw materials | $ 1,511,629 | $ 1,667,154 |
Work-in-progress | 475,194 | 419,906 |
Finished goods | 2,013,510 | 1,449,854 |
Reduction to LIFO cost | (1,318,393) | (1,356,378) |
Total Inventories | $ 2,681,940 | $ 2,180,536 |
Note 3 - Earnings Per Common _3
Note 3 - Earnings Per Common Share (EPS) (Details Textual) - Share-based Payment Arrangement, Option [Member] - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Antidilutive Securities Excluded from Computation Of Earnings Per Share Amount Based on Net Income Position (in shares) | 21,500 | 16,000 | 21,500 | 16,000 |
Share Based Compensation Arrangement by Share Based Payment Award Options With AntiDilutive Effect Weighted Average Exercise Price Based on Net Income Position (in dollars per share) | $ 7.38 | $ 12.17 | $ 7.38 | $ 12.17 |
Note 3 - Earnings Per Common _4
Note 3 - Earnings Per Common Share (EPS) - Summary of Calculation of Diluted EPS (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Weighted average common shares outstanding (in shares) | 1,976,354 | 1,982,275 | 1,976,354 | 1,982,910 |
Dilutive effect of stock options (in shares) | ||||
Weighted average common and common equivalent shares outstanding (in shares) | 1,976,354 | 1,982,275 | 1,976,354 | 1,982,910 |
Note 4 - Stock-based Compensa_3
Note 4 - Stock-based Compensation (Details Textual) - USD ($) | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance (in shares) | 21,500 | 19,250 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 10,000 | 0 | |
Share-based Payment Arrangement, Expense | $ 7,400 | $ 3,800 | |
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total | $ 33,700 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period (in shares) | 0 | 0 | |
The 1995 Incentive Stock Option Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares) | 442,750 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number, Ending Balance (in shares) | 8,250 | ||
The 1995 Incentive Stock Option Plan [Member] | Share-based Payment Arrangement, Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares) | 102,157 | ||
The 2019 Equity Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in shares) | 110,657 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period (in shares) | 8,500 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in shares) | 13,250 |
Note 4 - Stock-based Compensa_4
Note 4 - Stock-based Compensation - Assumptions (Details) - Share-based Payment Arrangement, Option [Member] | 6 Months Ended |
Jun. 30, 2020$ / shares | |
Dividend yield | 0.00% |
Expected volatility | 40.30% |
Expected life of option (years) (Year) | 10 years |
Risk-free interest rate | 1.40% |
Fair value of each option on grant date (in dollars per share) | $ 2.90 |
Note 4 - Stock-based Compensa_5
Note 4 - Stock-based Compensation - Stock Option Activity (Details) - $ / shares | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
Outstanding, Shares (in shares) | 19,250 | |
Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 11.32 | |
Granted, Shares (in shares) | 10,000 | 0 |
Granted, Weighted Average Exercise Price (in dollars per share) | $ 5.67 | |
Exercised, Shares (in shares) | 0 | 0 |
Exercised, Weighted Average Exercise Price (in dollars per share) | ||
Expired and forfeited, Shares (in shares) | (7,750) | |
Expired and forfeited, Weighted Average Exercise Price (in dollars per share) | $ 14.96 | |
Outstanding, Shares (in shares) | 21,500 | |
Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 7.38 | |
Exercisable, Shares (in shares) | 7,333 | |
Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 9.66 |
Note 5 - Segment Information (D
Note 5 - Segment Information (Details Textual) | 6 Months Ended |
Jun. 30, 2020 | |
Number of Reportable Segments | 4 |
Note 5 - Segment Information -
Note 5 - Segment Information - Reportable Segments (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | ||
Net sales | $ 2,572,439 | $ 4,596,411 | $ 6,069,631 | $ 8,125,102 | ||
Cost of goods sold | 2,187,544 | 3,167,982 | 4,531,504 | 5,687,554 | ||
Gross profit (loss) | 384,895 | 1,428,429 | 1,538,127 | 2,437,548 | ||
Selling general and administrative* | [1] | 1,202,307 | 1,338,861 | 2,983,327 | 2,720,826 | |
Research and development* | [1] | 201,234 | 270,465 | 384,814 | 449,307 | |
Loss from operations | (1,018,646) | (180,897) | (1,830,014) | (732,585) | ||
Trade receivables | 1,414,019 | 1,414,019 | $ 2,434,718 | |||
Operating Segments [Member] | Chromaline [Member] | ||||||
Net sales | 1,619,986 | 3,107,116 | 3,584,326 | 5,136,457 | ||
Cost of goods sold | 1,407,362 | 2,280,224 | 2,825,631 | 3,833,834 | ||
Gross profit (loss) | 212,624 | 826,892 | 758,695 | 1,302,623 | ||
Selling general and administrative* | [1] | 366,136 | 467,091 | 792,355 | 912,094 | |
Research and development* | [1] | |||||
Loss from operations | (153,512) | 359,801 | (33,660) | 390,529 | ||
Trade receivables | 1,097,348 | 1,097,348 | 1,916,066 | |||
Operating Segments [Member] | Ikonics Imaging [Member] | ||||||
Net sales | 625,800 | 958,128 | 1,595,899 | 2,046,934 | ||
Cost of goods sold | 419,985 | 501,006 | 897,708 | 1,086,510 | ||
Gross profit (loss) | 205,815 | 457,122 | 698,191 | 960,424 | ||
Selling general and administrative* | [1] | 224,573 | 248,050 | 503,435 | 570,503 | |
Research and development* | [1] | |||||
Loss from operations | (18,758) | 209,072 | 194,756 | 389,921 | ||
Trade receivables | 193,653 | 193,653 | 304,791 | |||
Operating Segments [Member] | DTX [Member] | ||||||
Net sales | 49,053 | 112,601 | 161,582 | 205,361 | ||
Cost of goods sold | 24,346 | 51,547 | 76,092 | 85,593 | ||
Gross profit (loss) | 24,707 | 61,054 | 85,490 | 119,768 | ||
Selling general and administrative* | [1] | 30,059 | 34,761 | 64,432 | 69,366 | |
Research and development* | [1] | |||||
Loss from operations | (5,352) | 26,293 | 21,058 | 50,402 | ||
Trade receivables | 38,912 | 38,912 | 13,919 | |||
Operating Segments [Member] | AMS [Member] | ||||||
Net sales | 277,600 | 418,566 | 727,824 | 736,350 | ||
Cost of goods sold | 335,851 | 335,205 | 732,073 | 681,617 | ||
Gross profit (loss) | (58,251) | 83,361 | (4,249) | 54,733 | ||
Selling general and administrative* | [1] | 57,035 | 88,362 | 160,144 | 176,510 | |
Research and development* | [1] | |||||
Loss from operations | (115,286) | (5,001) | (164,393) | (121,777) | ||
Trade receivables | 182,333 | 182,333 | 252,363 | |||
Segment Reconciling Items [Member] | ||||||
Net sales | ||||||
Cost of goods sold | ||||||
Gross profit (loss) | ||||||
Selling general and administrative* | [1] | 524,504 | 500,597 | 1,462,961 | 992,353 | |
Research and development* | [1] | 201,234 | 270,465 | 384,814 | 449,307 | |
Loss from operations | (725,738) | $ (771,062) | (1,847,775) | $ (1,441,660) | ||
Trade receivables | $ (98,227) | $ (98,227) | $ (52,421) | |||
[1] | The Company does not allocate all selling, general and administrative expenses or any research and development expenses to its operating segments for internal reporting. |
Note 6 - Income Taxes (Details
Note 6 - Income Taxes (Details Textual) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Effective Income Tax Rate Reconciliation, Percent, Total | 0.00% | 37.80% | 12.80% | 23.30% |
Income Tax Expense (Benefit), Total | $ 0 | $ (70,398) | $ (238,929) | $ (173,136) |
Unrecognized Tax Benefits, Ending Balance | $ 0 | $ 0 |
Note 7 - Long-term Debt (Detail
Note 7 - Long-term Debt (Details Textual) | Apr. 18, 2020USD ($) | Apr. 29, 2016 | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($) | Apr. 01, 2016USD ($) |
Proceeds from Issuance of Long-term Debt, Total | $ 1,214,500 | |||||
Line of Credit [Member] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | 2,050,000 | |||||
Long-term Line of Credit, Total | $ 0 | $ 0 | ||||
Line of Credit [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||
Debt Instrument, Basis Spread on Variable Rate | 1.80% | |||||
Loan [Member] | ||||||
Debt Service Coverage Ratio | 1.25 | |||||
SBA CARES Act Paycheck Protection Program [Member] | ||||||
Proceeds from Issuance of Long-term Debt, Total | $ 1,214,500 | |||||
Duluth Economic Development Authority [Member] | ||||||
Tax Exempt Industrial Revenue Bonds Amount Sold to Bank | $ 3,415,000 |