TeraWulf (WULF) 10-Q 14 May 18 2018 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 01, 2018
Document and Entity Information
Entity Registrant Name	IKONICS CORP
Entity Central Index Key	1,083,301
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
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		1,983,553
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1

CONDENSED BALANCE SHEETS

CONDENSED BALANCE SHEETS - USD ($)	Mar. 31, 2018	Dec. 31, 2017
CURRENT ASSETS:
Cash and cash equivalents	$ 1,162,188	$ 929,700
Short-term investments	2,675,000	2,895,000
Trade receivables, less allowances of $75,000 as of March 31, 2018 and $53,000 as of December 31, 2017	2,031,907	2,190,260
Inventories	2,368,831	2,086,065
Prepaid expenses and other assets	193,828	168,242
Income taxes receivable	42,738	2,116
Total current assets	8,474,492	8,271,383
PROPERTY, PLANT, AND EQUIPMENT, at cost:
Land and building	9,218,220	9,207,790
Machinery and equipment	5,001,384	4,968,595
Office equipment	1,578,976	1,573,191
Vehicles	245,679	245,679
Gross property, plant, and equipment, at cost	16,044,259	15,995,255
Less accumulated depreciation	(7,893,500)	(7,693,594)
Total property, plant, and equipment, at cost	8,150,759	8,301,661
INTANGIBLE ASSETS, less accumulated amortization of $181,470 as of March 31, 2018 and $174,991 as of December 31, 2017	360,278	351,186
Total assets	16,985,529	16,924,230
CURRENT LIABILITIES:
Current portion of long-term debt, net	131,797	130,899
Accounts payable	608,689	321,860
Accrued compensation	232,690	360,554
Other accrued liabilities	112,478	62,468
Total current liabilities	1,085,654	875,781
LONG-TERM LIABILITIES
Long-term debt, less current portion, net	2,912,950	2,946,518
Deferred income taxes	156,839	144,000
Total long-term liabilities	3,069,789	3,090,518
Total liabilities	4,155,443	3,966,299
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, par value $.10 per share; authorized 250,000 shares: none issued
Common stock, par value $.10 per share; authorized 4,750,000 shares; issued and outstanding 1,983,553 shares as of March 31, 2018 and December 31, 2017	198,355	198,355
Additional paid-in capital	2,712,283	2,709,390
Retained earnings	9,919,448	10,050,186
Total stockholders' equity	12,830,086	12,957,931
Total liabilities and stockholders' equity	$ 16,985,529	$ 16,924,230

CONDENSED BALANCE SHEETS (Paren

CONDENSED BALANCE SHEETS (Parenthetical) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
CONDENSED BALANCE SHEETS
Trade receivables, allowance	$ 75,000	$ 53,000
INTANGIBLE ASSETS, accumulated amortization	$ 181,470	$ 174,991
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	1,983,553	1,983,553
Common stock, shares outstanding	1,983,553	1,983,553

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CONDENSED STATEMENTS OF OPERATIONS
NET SALES	$ 4,071,478	$ 3,628,992
COST OF GOODS SOLD	2,709,059	2,538,764
GROSS PROFIT	1,362,419	1,090,228
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES	1,348,983	1,510,614
RESEARCH AND DEVELOPMENT EXPENSES	154,076	165,770
LOSS FROM OPERATIONS	(140,640)	(586,156)
INTEREST EXPENSE	(19,935)	(20,817)
OTHER	9,421	5,153
LOSS BEFORE INCOME TAXES	(151,154)	(601,820)
INCOME TAX BENEFIT	(20,416)	(222,923)
NET LOSS	$ (130,738)	$ (378,897)
LOSS PER COMMON SHARE:
Basic (in dollars per share)	$ (0.07)	$ (0.19)
Diluted (in dollars per share)	$ (0.07)	$ (0.19)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic (in shares)	1,983,553	2,018,753
Diluted (in shares)	1,983,553	2,018,753

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (130,738)	$ (378,897)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation	199,906	212,302
Amortization	9,442	9,574
Stock based compensation	2,893	5,461
Deferred income taxes	12,839
Changes in working capital components:
Trade receivables	158,353	405,542
Inventories	(282,766)	(246,362)
Prepaid expenses and other assets	(25,586)	(29,930)
Income tax receivable	(40,622)	(214,359)
Accounts payable	286,829	111,754
Accrued expenses	(77,854)	(120,476)
Net cash provided by (used in) operating activities	112,696	(245,391)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant, and equipment	(49,004)	(60,417)
Purchases of intangible assets	(15,572)	(7,682)
Purchases of short-term investments	(1,205,000)	(1,225,000)
Proceeds on sale of short-term investments	1,425,000	1,133,000
Net cash provided by (used in) investing activities	155,424	(160,099)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term debt	(35,632)	(34,883)
Net cash used in financing activities	(35,632)	(34,883)
NET DECREASE IN CASH AND CASH EQUIVALENTS	232,488	(440,373)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	929,700	1,048,713
CASH AND CASH EQUIVALENTS AT END OF PERIOD	1,162,188	608,340
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest	17,038	17,786
Cash paid for income taxes, net	$ 7,367	$ 8,564

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 31, 2018
Basis of Presentation
Basis of Presentation	1. The condensed balance sheet of IKONICS Corporation (the “Company”) as of March 31, 2018, and the related condensed statements of operations for the three months ended March 31, 2018 and 2017, and cash flows for the three months ended March 31, 2018 and 2017, 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 March 31, 2018, 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, 2017. The results of operations for interim periods are not necessarily indicative of results that will be realized for the full fiscal year.

Revenue

Revenue	3 Months Ended
	Mar. 31, 2018
Revenue
Revenue	2. The Company’s significant accounting policies are detailed in “Note 1: Summary of Significant Accounting Policies” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Topic 606. Revenue from Contracts with Customers (Topic 606), and in August 2015, FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date , which deferred the effective date of ASU 2014-09 by one year. Topic 606 supersedes the revenue recognition requirements previously set forth in the Accounting Standards Codification (ASC) Topic 605, Revenue Recognition , and requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. On January 1, 2018, the Company adopted Topic 606 for all customer contracts using the modified retrospective method. The adoption of Topic 606 did not result in a change to revenue previously recognized under prior revenue recognition rules. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company does not expect the adoption of the new revenue standard to have a material impact to its operating results on an ongoing basis. A majority of the Company’s sales revenue continues to be recognized when products are shipped from its manufacturing facility. However, depending on the individual terms of the agreement with the customer, some sales revenue may be recognized when the goods arrive at the customer’s location, the point at which control transfers. Changes to the Company’s significant accounting policies as a result of adopting Topic 606 are discussed below: Revenue recognition. Revenue is measured based on consideration specified in the contract with a customer, adjusted for any applicable estimates of variable consideration and other factors affecting the transaction price, including noncash consideration, consideration paid or payable to customers and significant financing components. While most of the Company’s revenue is contracted with customers through one-time purchase orders and short-term contracts, the Company does have long-term arrangements with certain customers. Revenue from all customers is recognized when a performance obligation is satisfied by transferring control of a distinct good or service to a customer. Individually promised goods and services in a contract are considered a distinct performance obligation and accounted for separately if the customer can benefit from the individual good or service on its own or with other resources that are readily available to the customer and the good or service is separately identifiable from other promises in the arrangement. When an arrangement includes multiple performance obligations, the consideration is allocated between the performance obligations in proportion to their estimated standalone selling price. Costs related to products delivered are recognized in the period incurred, unless criteria for capitalization of costs are met. Costs of revenues consist primarily of direct labor, manufacturing overhead, materials and components. The Company does not incur significant upfront costs to obtain a contract. If costs to obtain a contract were to become material, the costs would be recorded as an asset and amortized to expense in a manner consistent with the related recognition of revenue. The Company excludes government assessed and imposed taxes on revenue generating transactions that are invoiced to customers from revenue. The Company includes freight billed to customers in revenue. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost and are included in cost of goods sold. The timing of revenue recognition, billings and cash collections results in accounts receivable on the balance sheet. Performance obligations. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer. A contract’s transaction price is allocated to each distinct performance obligation in proportion to its standalone selling price and recognized as revenue when, or as, the performance obligation is satisfied. The Company’s various performance obligations and the timing or method of revenue recognition are discussed below: The Company sells its products to both distributors and end-users. Each unit of product delivered under a customer order represents a distinct and separate performance obligation as the customer can benefit from each unit on its own or with other resources that are readily available to the customer and each unit of product is separately identifiable from other products in the arrangement. The transaction price for the Company’s products is the invoiced amount. The Company does not have variable consideration in the form of refunds, credits, rebates, price concessions, pricing incentives or other items impacting transaction price. The purchase order pricing in arrangements with customers is deemed to approximate standalone selling price; therefore, the Company does not need to allocate proceeds on a relative standalone selling price allocation between performance obligations. The Company applies the practical expedient in paragraph 606-10-50-14 and does not disclose information about remaining performance obligations that have original expected durations of one year or less. There are no material obligations that extend beyond one year. Revenue is recognized when transfer of control occurs as defined by the terms in the customer agreement. The Company immediately recognizes incidental items that are immaterial in the context of the contract. The Company has applied the practical expedient in paragraph 606-10-25-16A and does not assess if immaterial items are promised goods or services. The Company has also applied the practical expedient in paragraph 606-10-32-18 regarding the adjustment of the promised amount of consideration for the effects of a significant financing component when the customer pays for that good or service within one year or less, as the Company does not have any significant financing components in its customer arrangements as payment is received at or shortly after the point of sale, generally thirty to ninety days. The Company estimates returns based on an analysis of historical experience if the right to return products is granted to its customers. The Company does not record a return asset as non-conforming products are generally not returned. The Company’s return policy does not vary by geography. The customer has no rotation or price protection rights, and the Company is not under a warranty obligation. Trade receivables. Trade receivables include amounts invoiced and currently due from customers. The amounts due are stated at their net estimated realizable value. The Company records an allowance for doubtful accounts to provide for the estimated amount of receivables that will not be collected. The allowance is based on a review of all outstanding amounts on an on-going basis. Management determines the allowance for doubtful accounts by regularly evaluating individual customer receivables and considers a customer’s financial condition, credit history, and current economic conditions. Trade receivables are written off when deemed uncollectible. Recoveries of trade receivables previously written off are recorded when received. Accounts are considered past due if payment is not received according to agreed-upon terms. Sales commissions . Sales commissions paid to sales representatives are eligible for capitalization as they are incremental costs that would not have been incurred without entering into a specific sales arrangement and are recoverable through the expected margin on the transaction. The Company has elected to apply the practical expedient provided by ASC 340-40-25-4 and recognize the incremental costs of obtaining contracts as an expense when incurred, as the amortization period of the assets that would have otherwise been recognized is one year or less. The Company records these costs in selling, general, and administrative expense. Product warranty . The Company offers warranties on various products and services. These warranties are assurance type warranties that are not sold on a standalone basis; therefore, they are not considered distinct performance obligations. The Company estimates the costs that may be incurred under its warranties and records a liability in the amount of such costs at the time the revenue is recognized for the product sale. International revenue. The Company markets its products to numerous countries in North America, Europe, Latin America, Asia and other parts of the world. Foreign sales were approximately 29% of total sales during the first three months of 2018 compared to 30% of sales for the first three months of 2017.

Short-Term Investments

Short-Term Investments	3 Months Ended
	Mar. 31, 2018
Short-Term Investments
Short-Term Investments	3. The Company’s $2.7 million of short-term investments at March 31, 2018 is comprised of 11 fully insured certificates of deposit with original maturities ranging from four to six months and interest rates ranging from 1.25% to 1.70%

Inventories

Inventories	3 Months Ended
	Mar. 31, 2018
Inventories
Inventories	4. The major components of inventories are as follows: Mar 31, 2018 Dec 31, 2017 Raw materials $ 1,563,864 $ 1,428,924 Work-in-progress 359,337 423,186 Finished goods 1,632,650 1,416,547 Reduction to LIFO cost (1,187,020) (1,182,592) Total Inventories $ 2,368,831 $ 2,086,065

Earnings Per Common Share (EPS)

Earnings Per Common Share (EPS)	3 Months Ended
	Mar. 31, 2018
Earnings Per Common Share (EPS)
Earnings Per Common Share (EPS)	5. 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 6 have been excluded from the computation because of their antidilutive effect. Shares used in the calculation of diluted EPS are summarized below: Three Months Ended Mar 31, 2018 Mar 31, 2017 Weighted average common shares outstanding 1,983,553 2,018,753 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,983,553 2,018,753 If the Company was in a net income position for the first three months of 2018, no options would have been included as part of the common and common equivalent shares outstanding, and 18,168 options with a weighted average exercise price of $13.81 would have remained excluded as the options were anti-dilutive. If the Company was in a net income position for the first three months of 2017, 250 options with a weighted average exercise price of $7.54 would have been included as part of the weighted average common and common equivalent shares outstanding as the options would have been dilutive while 15,918 options with a weighted average exercise price of $14.51 would have remained excluded as the options were anti-dilutive .

Stock-based Compensation

Stock-based Compensation	3 Months Ended
	Mar. 31, 2018
Stock-based Compensation
Stock-Based Compensation	6. The Company maintains a stock incentive plan which authorizes the issuance of up to 442,750 shares of common stock. Of those shares, 18,168 were subject to outstanding options and 101,989 were reserved for future grants at March 31, 2018. The plan provides for grants of stock options or other stock awards to eligible participants, 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 $3,000 against income (loss) for the three months ended March 31, 2018 and $5,000 against income (loss) for the three months March 31, 2017. As of March 31, 2018, there was approximately $14,000 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 additional paid in capital and reduces income taxes payable. No stock options were exercised during the three months ended March 31, 2018 or 2017, and there were no options granted during the three months ended March 31, 2018 or 2017. Stock option activity during the three months ended March 31, 2018 was as follows: Weighted Average Exercise Shares Price Outstanding at January 1, 2018 18,168 $ 13.81 Outstanding at March 31, 2018 18,168 $ 13.81 Exercisable at March 31, 2018 12,166 $ 15.46 The aggregate intrinsic value of all options outstanding and exercisable at March 31, 2018 was $0.

Segment Information

Segment Information	3 Months Ended
	Mar. 31, 2018
Segment Information
Segment Information	7. 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 Advanced Material Solutions (AMS). 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. AMS provides sound deadening and weight reduction 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 and prototyping. Export sells primarily the same products as Domestic and the IKONICS Imaging products not related to AMS or DTX. The accounting policies applied to determine the segment information are the same as those described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. Management evaluates the performance of each segment based on the components of divisional income (loss). Assets and liabilities are not allocated 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 March 31, 2018: IKONICS IKONICS Domestic Export Imaging DTX AMS Unalloc. Total Net sales $ 1,344,480 $ 1,158,340 $ 1,057,338 $ 88,666 $ 422,654 $ — $ 4,071,478 Cost of goods sold 834,341 897,060 557,088 25,392 395,178 — 2,709,059 Gross profit 510,139 261,280 500,250 63,274 27,476 — 1,362,419 Selling, general and administrative* 309,134 121,628 279,593 34,852 84,784 518,992 1,348,983 Research and development* — — — — — 154,076 154,076 Income (loss) from operations $ 201,005 $ 139,652 $ 220,657 $ 28,422 $ (57,308) $ (673,068) $ (140,640) For the three months ended March 31, 2017: IKONICS IKONICS Domestic Export Imaging DTX AMS Unalloc. Total Net sales $ 1,303,569 $ 1,055,005 $ 989,986 $ 115,231 $ 165,201 $ — $ 3,628,992 Cost of goods sold 826,741 839,364 523,580 35,482 313,597 — 2,538,764 Gross profit (loss) 476,828 215,641 466,406 79,749 (148,396) — 1,090,228 Selling, general and administrative* 351,422 196,117 283,859 34,635 96,795 547,786 1,510,614 Research and development* — — — — — 165,770 165,770 Income (loss) from operations $ 125,406 $ 19,524 $ 182,547 $ 45,114 $ (245,191) $ (713,556) $ (586,156) * Trade receivables by segment as of March 31, 2018 and December 31, 2017 were as follows: Mar 31, 2018 Dec 31, 2017 Domestic $ 778,030 $ 1,119,228 Export 501,673 558,872 IKONICS Imaging 333,096 238,813 DTX 45,107 64,278 AMS 366,185 238,848 Unallocated 7,816 (29,779) Total $ 2,031,907 $ 2,190,260

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2018
Income taxes
Income Taxes	8. The federal Tax Cut and Jobs Act of 2017 (the “Tax Reform Act”) was enacted December 22, 2017. Effective January 1, 2018, the Tax Reform Act reduced statutory corporate income tax rates from 35% to 21% in addition to other tax changes including re-valuation of deferred tax assets and liabilities. For the first quarter of 2018, the Company realized an income tax benefit of $20,000, or an effective rate of 13.5%, which reflects the new federal corporate rate of 21% versus the income tax benefit of $223,000, or an effective rate of 37.0%, for the first quarter of 2017. The Company’s 2018 and 2017 first quarter tax benefit was due to the year to date net loss. The income tax provision for the 2018 and 2017 periods differ from the expected benefit due to credits for research and development, and other non-deductible items. The Company’s federal net operating loss carryforward and research and development credit carryover as of March 31, 2018 was $167,000 and $27,000, respectively, and will begin to expire in 2036. The Company’s state net operating loss carryforwards and research and development credit carryover as of March 31, 2018 was $834,000 and $91,000, respectively and begin to expire in 2026. The valuation allowance balance of $91,000 at March 31, 2018, relates entirely to Minnesota research and development credit carryforwards that the Company does not expect to utilize and begin to expire in 2028. It has been the Company’s policy to recognize interest and penalties related to uncertain tax positions in income tax expense. As of March 31, 2018 and December 31, 2017, there was no liability for unrecognized tax benefits. The Company is subject to federal and state taxation. As of March 31, 2018, with few exceptions, the Company is no longer subject to examination prior to tax year 2014.

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Mar. 31, 2018
Inventories
Schedule of major components of inventories	Mar 31, 2018 Dec 31, 2017 Raw materials $ 1,563,864 $ 1,428,924 Work-in-progress 359,337 423,186 Finished goods 1,632,650 1,416,547 Reduction to LIFO cost (1,187,020) (1,182,592) Total Inventories $ 2,368,831 $ 2,086,065

Earnings Per Common Share (EP15

Earnings Per Common Share (EPS) (Tables)	3 Months Ended
	Mar. 31, 2018
Earnings Per Common Share (EPS)
Summary of shares used in the calculation of diluted EPS	Three Months Ended Mar 31, 2018 Mar 31, 2017 Weighted average common shares outstanding 1,983,553 2,018,753 Dilutive effect of stock options — — Weighted average common and common equivalent shares outstanding 1,983,553 2,018,753

Stock-based Compensation (Table

Stock-based Compensation (Tables)	3 Months Ended
	Mar. 31, 2018
Stock-based Compensation
Stock option activity	Weighted Average Exercise Shares Price Outstanding at January 1, 2018 18,168 $ 13.81 Outstanding at March 31, 2018 18,168 $ 13.81 Exercisable at March 31, 2018 12,166 $ 15.46

Segment Information (Tables)

Segment Information (Tables)	3 Months Ended
	Mar. 31, 2018
Segment Information
Schedule of financial information with respect to the reportable segments	For the three months ended March 31, 2018: IKONICS IKONICS Domestic Export Imaging DTX AMS Unalloc. Total Net sales $ 1,344,480 $ 1,158,340 $ 1,057,338 $ 88,666 $ 422,654 $ — $ 4,071,478 Cost of goods sold 834,341 897,060 557,088 25,392 395,178 — 2,709,059 Gross profit 510,139 261,280 500,250 63,274 27,476 — 1,362,419 Selling, general and administrative* 309,134 121,628 279,593 34,852 84,784 518,992 1,348,983 Research and development* — — — — — 154,076 154,076 Income (loss) from operations $ 201,005 $ 139,652 $ 220,657 $ 28,422 $ (57,308) $ (673,068) $ (140,640) For the three months ended March 31, 2017: IKONICS IKONICS Domestic Export Imaging DTX AMS Unalloc. Total Net sales $ 1,303,569 $ 1,055,005 $ 989,986 $ 115,231 $ 165,201 $ — $ 3,628,992 Cost of goods sold 826,741 839,364 523,580 35,482 313,597 — 2,538,764 Gross profit (loss) 476,828 215,641 466,406 79,749 (148,396) — 1,090,228 Selling, general and administrative* 351,422 196,117 283,859 34,635 96,795 547,786 1,510,614 Research and development* — — — — — 165,770 165,770 Income (loss) from operations $ 125,406 $ 19,524 $ 182,547 $ 45,114 $ (245,191) $ (713,556) $ (586,156) *
Schedule of trade receivables by segment	Mar 31, 2018 Dec 31, 2017 Domestic $ 778,030 $ 1,119,228 Export 501,673 558,872 IKONICS Imaging 333,096 238,813 DTX 45,107 64,278 AMS 366,185 238,848 Unallocated 7,816 (29,779) Total $ 2,031,907 $ 2,190,260

Revenue (Details)

Revenue (Details)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenue
Disclosure information about remaining performance obligation Practical Expedient	true
Financing Component Practical Expedient	true
Sales Commissions Practical Expedient	true
International | Geographic Concentration Risk | Revenues
Revenue
Percentage of sales	29.00%
International | Calculated under Revenue Guidance in Effect before Topic 606 | Geographic Concentration Risk | Revenues
Revenue
Percentage of sales		30.00%

Short-Term Investments (Details

Short-Term Investments (Details)	3 Months Ended
	Mar. 31, 2018USD ($)item	Dec. 31, 2017USD ($)
Short-term investments
Short-term Investments. | $	$ 2,675,000	$ 2,895,000
Certificates of Deposit
Short-term investments
Number of fully insured certificates of deposit | item	11
Certificates of Deposit | Minimum
Short-term investments
Maturity period	4 months
Interest rate (as a percent)	1.25%
Certificates of Deposit | Maximum
Short-term investments
Maturity period	6 months
Interest rate (as a percent)	1.70%

Inventories (Details)

Inventories (Details) - USD ($)	Mar. 31, 2018	Dec. 31, 2017
Inventories
Raw materials	$ 1,563,864	$ 1,428,924
Work-in-progress	359,337	423,186
Finished goods	1,632,650	1,416,547
Reduction to LIFO cost	(1,187,020)	(1,182,592)
Total inventories	$ 2,368,831	$ 2,086,065

Earnings Per Common Share (EP21

Earnings Per Common Share (EPS) (Details) - $ / shares	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Shares used in calculation of diluted EPS
Weighted average common shares outstanding	1,983,553	2,018,753
Weighted average common and common equivalent shares outstanding	1,983,553	2,018,753
Stock Options.
Dilutive effect
Based on the Company's net income position, dilutive effect of stock options (in shares)	0	250
Based on the Company's net income position, dilutive effect of stock options, weighted average exercise price (in dollars per share)		$ 7.54
Based on the Company's net income position, anti-dilutive securities (in shares)	18,168	15,918
Based on the Company's net income position, anti-dilutive securities, weighted average exercise price (in dollars per share)	$ 13.81	$ 14.51

Stock-Based Compensation - Plan

Stock-Based Compensation - Plan and Expense Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Stock-Based Compensation
Common stock reserved for future grants (in shares)	101,989
Compensation cost recognized	$ 3,000	$ 5,000
Unrecognized compensation cost	$ 14,000
Period during which compensation cost is expected to be recognized	3 years
Maximum
Stock-Based Compensation
Number of shares of common stock authorized for issuance	442,750
Stock Options.
Stock-Based Compensation
Outstanding options (in shares)	18,168		18,168
Exercise of stock options and related tax benefit (in shares)	0	0
Stock Options. | Minimum
Stock-Based Compensation
Price range of stock award (as a percent)	85.00%
Period over which options become exercisable	1 year
Stock Options. | Maximum
Stock-Based Compensation
Price range of stock award (as a percent)	110.00%
Expiration period of options granted	7 years
Period over which options become exercisable	3 years

Stock-Based Compensation - Assu

Stock-Based Compensation - Assumptions and Activity (Details) - Stock Options. - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Shares
Outstanding at beginning of period (in shares)	18,168
Granted (in shares)	0	0
Exercised (in shares)	0	0
Outstanding at end of period (in shares)	18,168
Exercisable at end of period (in shares)	12,166
Weighted Average Exercise Price
Outstanding at beginning of period (in dollars per shares)	$ 13.81
Outstanding at end of period (in dollars per share)	13.81
Exercisable at end of period (in dollars per share)	$ 15.46
Aggregate intrinsic value of all options outstanding	$ 0

Segment Information (Details)

Segment Information (Details)	3 Months Ended
	Mar. 31, 2018USD ($)segment	Mar. 31, 2017USD ($)	Dec. 31, 2017USD ($)
Segment Reporting Information
Number of reportable segments | segment	5
Financial information with respect to the reportable segments
Net sales	$ 4,071,478	$ 3,628,992
Cost of goods sold	2,709,059	2,538,764
GROSS PROFIT	1,362,419	1,090,228
Selling general and administrative	1,348,983	1,510,614
Research and development	154,076	165,770
Income (loss) from operations	(140,640)	(586,156)
Trade receivables by segment
Trade receivables	2,031,907		$ 2,190,260
Unalloc.
Financial information with respect to the reportable segments
Selling general and administrative	518,992	547,786
Research and development	154,076	165,770
Income (loss) from operations	(673,068)	(713,556)
Trade receivables by segment
Trade receivables	7,816		(29,779)
Domestic
Financial information with respect to the reportable segments
Net sales	1,344,480	1,303,569
Cost of goods sold	834,341	826,741
GROSS PROFIT	510,139	476,828
Selling general and administrative	309,134	351,422
Income (loss) from operations	201,005	125,406
Trade receivables by segment
Trade receivables	778,030		1,119,228
Export
Financial information with respect to the reportable segments
Net sales	1,158,340	1,055,005
Cost of goods sold	897,060	839,364
GROSS PROFIT	261,280	215,641
Selling general and administrative	121,628	196,117
Income (loss) from operations	139,652	19,524
Trade receivables by segment
Trade receivables	501,673		558,872
IKONICS Imaging
Financial information with respect to the reportable segments
Net sales	1,057,338	989,986
Cost of goods sold	557,088	523,580
GROSS PROFIT	500,250	466,406
Selling general and administrative	279,593	283,859
Income (loss) from operations	220,657	182,547
Trade receivables by segment
Trade receivables	333,096		238,813
DTX
Financial information with respect to the reportable segments
Net sales	88,666	115,231
Cost of goods sold	25,392	35,482
GROSS PROFIT	63,274	79,749
Selling general and administrative	34,852	34,635
Income (loss) from operations	28,422	45,114
Trade receivables by segment
Trade receivables	45,107		64,278
Micro-Machining
Financial information with respect to the reportable segments
Net sales	422,654	165,201
Cost of goods sold	395,178	313,597
GROSS PROFIT	27,476	(148,396)
Selling general and administrative	84,784	96,795
Income (loss) from operations	(57,308)	$ (245,191)
Trade receivables by segment
Trade receivables	$ 366,185		$ 238,848

Income Taxes (Details)

Income Taxes (Details) - USD ($)	Jan. 01, 2018	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Deferred tax amounts included in balance sheet
U.S. federal income tax rate (as a percent)	21.00%			35.00%
Income tax benefit		$ 20,416	$ 222,923
Effective tax rate (as a percent)		13.50%	37.00%
Unrecognized tax benefits		$ 0	$ 0
Valuation allowance		91,000
Federal
Deferred tax amounts included in balance sheet
Federal net operating loss carryforwards		167,000
Research and development credit		27,000
State
Deferred tax amounts included in balance sheet
State net operating loss carryforwards		834,000
Research and development credit		$ 91,000