Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 21, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Registrant Name | BROADWIND ENERGY, INC. | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Interactive Data Current | Yes | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 16,556,993 | ||
Entity Public Float | $ 26,772,000 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001120370 | ||
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash | $ 2,416 | $ 1,177 |
Accounts receivable, net | 18,310 | 17,455 |
Inventories, net | 31,863 | 22,670 |
Prepaid expenses and other current assets | 2,124 | 1,776 |
Total current assets | 54,713 | 43,078 |
LONG-TERM ASSETS: | ||
Property and equipment, net | 46,940 | 49,087 |
Operating lease right-of-use assets | 15,980 | |
Other intangible assets, net | 4,919 | 6,602 |
Other assets | 314 | 398 |
TOTAL ASSETS | 122,866 | 99,165 |
CURRENT LIABILITIES: | ||
Line of credit and other notes payable | 12,917 | 11,930 |
Current portion of finance lease obligations | 546 | 967 |
Current portion of operating lease obligations | 1,326 | |
Accounts payable | 21,876 | 11,618 |
Accrued liabilities | 4,911 | 3,806 |
Customer deposits | 22,717 | 23,507 |
Current liabilities held for sale | 27 | |
Total current liabilities | 64,293 | 51,855 |
LONG-TERM LIABILITIES: | ||
Long-term debt, net of current maturities | 505 | 1,408 |
Long-term finance lease obligations, net of current portion | 673 | 571 |
Long-term operating lease obligations, net of current portion | 16,591 | |
Other | 44 | 1,969 |
Total long-term liabilities | 17,813 | 3,948 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS’ EQUITY: | ||
Preferred stock, $0.001 par value; 10,000,000 shares authorized; no shares issued or outstanding | ||
Common stock, $0.001 par value; 30,000,000 shares authorized; 16,830,930 and 15,982,622 shares issued as of December 31, 2019, and December 31, 2018, respectively | 17 | 16 |
Treasury stock, at cost, 273,937 shares as of December 31, 2019 and December 31, 2018 | (1,842) | (1,842) |
Additional paid-in capital | 383,361 | 381,441 |
Accumulated deficit | (340,776) | (336,253) |
Total stockholders’ equity | 40,760 | 43,362 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 122,866 | $ 99,165 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 16,830,930 | 15,982,622 |
Treasury stock, common shares | 273,937 | 273,937 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 178,220 | $ 125,380 |
Cost of sales | 162,796 | 121,684 |
Restructuring | 12 | 631 |
Gross profit | 15,412 | 3,065 |
OPERATING EXPENSES: | ||
Selling, general and administrative | 16,086 | 13,625 |
Impairment charges | 12,585 | |
Intangible amortization | 1,683 | 1,884 |
Restructuring | 37 | |
Total operating expenses | 17,769 | 28,131 |
Operating loss | (2,357) | (25,066) |
OTHER EXPENSE, net: | ||
Interest expense, net | (2,309) | (1,496) |
Other, net | 118 | 2,355 |
Total other expense, net | (2,191) | 859 |
Net loss before provision (benefit) for income taxes | (4,548) | (24,207) |
Provision (benefit) for income taxes | 38 | (205) |
LOSS FROM CONTINUING OPERATIONS | (4,586) | (24,002) |
INCOME (LOSS) FROM DISCONTINUED OPERATIONS | 63 | (144) |
NET LOSS | $ (4,523) | $ (24,146) |
NET LOSS PER COMMON SHARE—BASIC: | ||
Loss from continuing operations (in dollars per share) | $ (0.28) | $ (1.55) |
Income (loss) from discontinued operations (in dollars per share) | 0 | (0.01) |
Net loss (in dollars per share) | $ (0.28) | $ (1.56) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-BASIC (in shares) | 16,127,296 | 15,468,975 |
NET LOSS PER COMMON SHARE—DILUTED: | ||
Loss from continuing operations (in dollars per share) | $ (0.28) | $ (1.55) |
Income (loss) from discontinued operations (in dollars per share) | 0 | (0.01) |
Net loss (in dollars per share) | $ (0.28) | $ (1.56) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-DILUTED (in shares) | 16,127,296 | 15,468,975 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2017 | $ 15 | $ (1,842) | $ 380,005 | $ (312,107) | $ 66,071 |
Balance (in shares) at Dec. 31, 2017 | 15,480,299 | (273,937) | |||
Increase (Decrease) in Stockholders' Equity | |||||
Stock issued for restricted stock | $ 1 | 1 | |||
Stock issued for restricted stock (in shares) | 156,472 | ||||
Stock issued under defined contribution 401(k) retirement savings plan | 685 | 685 | |||
Stock issued under defined contribution 401(k) retirement savings plan (in shares) | 330,739 | ||||
Share-based compensation | 803 | 803 | |||
Sale of common stock, net of expenses | (52) | $ (52) | |||
Sale of common stock, net of expenses (shares) | 15,112 | 15,112 | |||
Net loss | (24,146) | $ (24,146) | |||
Balance at Dec. 31, 2018 | $ 16 | $ (1,842) | 381,441 | (336,253) | $ 43,362 |
Balance (in shares) at Dec. 31, 2018 | 15,982,622 | (273,937) | 15,982,622 | ||
Increase (Decrease) in Stockholders' Equity | |||||
Stock issued for restricted stock | $ 1 | $ 1 | |||
Stock issued for restricted stock (in shares) | 223,580 | ||||
Stock issued under defined contribution 401(k) retirement savings plan | 962 | 962 | |||
Stock issued under defined contribution 401(k) retirement savings plan (in shares) | 624,728 | ||||
Share-based compensation | 958 | 958 | |||
Net loss | (4,523) | (4,523) | |||
Balance at Dec. 31, 2019 | $ 17 | $ (1,842) | $ 383,361 | $ (340,776) | $ 40,760 |
Balance (in shares) at Dec. 31, 2019 | 16,830,930 | (273,937) | 16,830,930 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (4,523) | $ (24,146) |
Income (loss) from discontinued operations | 63 | (144) |
Loss from continuing operations | (4,586) | (24,002) |
Adjustments to reconcile net cash used in operating activities: | ||
Depreciation and amortization expense | 7,497 | 9,183 |
Deferred income taxes | (30) | (307) |
Impairment charges | 12,585 | |
Remeasurement of contingent consideration | (1,140) | |
Change in fair value of interest rate swap agreements | 34 | |
Stock-based compensation | 958 | 803 |
Extinguishment of New Markets Tax Credits obligation | (2,249) | |
Allowance for doubtful accounts | (63) | (35) |
Common stock issued under defined contribution 401(k) plan | 962 | 685 |
Gain on disposal of assets | (1) | (116) |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable | (792) | (3,776) |
Inventories | (9,193) | (2,944) |
Prepaid expenses and other current assets | (585) | 22 |
Accounts payable | 9,769 | 801 |
Accrued liabilities | 1,105 | 553 |
Customer deposits | (790) | 13,716 |
Other non-current assets and liabilities | 236 | (1,734) |
Net cash provided by operating activities of continuing operations | 4,521 | 2,045 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (1,844) | (2,324) |
Proceeds from disposals of property and equipment | 1 | 676 |
Net cash used in investing activities of continuing operations | (1,843) | (1,648) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from line of credit | 177,081 | 141,414 |
Payments on line of credit | (176,564) | (141,040) |
Proceeds from long-term debt | 2,060 | |
Payments on long-term debt | (937) | (761) |
Principal payments on finance leases | (1,024) | |
Principal payments on finance leases | (814) | |
Proceeds from sale of common stock, net | (52) | |
Net cash (used in) provided by financing activities of continuing operations | (1,444) | 807 |
DISCONTINUED OPERATIONS: | ||
Operating cash flows | 5 | (105) |
Net cash provided by (used in) discontinued operations | 5 | (105) |
NET INCREASE IN CASH | 1,239 | 1,099 |
CASH beginning of the period | 1,177 | 78 |
CASH end of the period | 2,416 | 1,177 |
Supplemental cash flow information: | ||
Interest paid | 1,619 | 1,168 |
Income taxes paid | 49 | 116 |
Non-cash activities: | ||
Issuance of restricted stock grants | 958 | 803 |
Equipment additions via capital lease | 704 | 650 |
Non-cash purchases of property and equipment | $ 552 | $ 64 |
DESCRIPTION OF BUSINESS AND SUM
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. DESCRIPTION OF BUSINESS Description of Business Broadwind Energy, Inc. (the “Company”) is a precision manufacturer of structures, equipment and components for clean tech and other specialized applications. The Company provides technologically advanced high value products to customers with complex systems and stringent quality standards that operate in energy, mining and infrastructure sectors, primarily in the United States of America (the “U.S.”). The Company’s most significant presence is within the U.S. wind energy industry, although the Company has increasingly diversified into other industrial markets. Within the U.S. wind energy industry, the Company provides products primarily to turbine manufacturers. The Company also provides precision gearing and heavy fabrications to a broad range of industrial customers for oil and gas (“O&G”), mining, steel and other industrial applications, in addition to supplying components for natural gas turbines. The Company has three reportable operating segments: Heavy Fabrications, Gearing, and Industrial Solutions. During the first quarter of 2019, the Company assessed its segment reporting by evaluating various qualitative and quantitative measures for each business and product line. Following the execution of the Company’s 2018 restructuring plan and the resulting exit of the leased Abilene facility at the end of 2018, the Company revised its segment presentation by moving its Abilene compressed natural gas and industrial fabrication business from the Industrial Solutions segment to the Heavy Fabrications segment. The Company made this determination because, post-restructuring, the residual industrial fabrications business activities previously carried out in the now vacated space were transferred to the nearby tower plant under the supervision of Heavy Fabrications segment management. The Company has restated prior periods presented to reflect this change. See Note 15, “Segment Reporting” of these consolidated financial statements for further discussion of reportable segments. Effective, January 1, 2020, the Company rebranded to Broadwind Energy, Inc. doing business as Broadwind, a reflection of its diversification progress to date and continued strategy to expand its product and customer diversification outside of wind energy. Effective with that rebranding, the Company renamed certain segments. The Towers and Heavy Fabrications segment was renamed to Heavy Fabrications and the Process Systems segment was renamed to Industrial Solutions. The Gearing segment name remained the same. These notes to the consolidated financial statements incorporate these changes. Heavy Fabrications The Company provides large, complex and precision fabrications to customers in a broad range of industrial markets. The Company’s most significant presence is within the U.S. wind energy industry, although it has diversified into other industrial markets in order to improve capacity utilization, reduce customer concentrations, and reduce exposure to uncertainty related to governmental policies currently impacting the U.S. wind energy industry. Within the U.S. wind energy industry, the Company provides steel towers and adapters primarily to wind turbine manufacturers. Production facilities, located in Manitowoc, Wisconsin and Abilene, Texas, are situated in close proximity to the primary U.S. domestic wind energy and equipment manufacturing hubs. The two facilities have a combined annual tower production capacity of up to approximately 550 towers (1650 tower sections), sufficient to support turbines generating more than 1,100 MW of power. The Company has expanded its production capabilities and leveraged manufacturing competencies, including welding, lifting capacity and stringent quality practices, into aftermarket and OEM components utilized in surface and underground mining, construction, material handling, O&G and other infrastructure markets. Gearing The Company provides gearing and gearboxes to a broad set of customers in diverse markets including; onshore and offshore O&G fracking and drilling, surface and underground mining, wind energy, steel, material handling and other infrastructure markets. The Company has manufactured loose gearing, gearboxes and systems, and provided heat treat services for aftermarket and OEM applications for nearly a century. The Company uses an integrated manufacturing process, which includes machining and finishing processes in Cicero, Illinois, and heat treatment in Neville Island, Pennsylvania. Industrial Solutions The Company provides supply chain solutions, inventory management, kitting and assembly services, primarily serving the combined cycle natural gas turbine market. Liquidity The Company meets its short term liquidity needs through cash generated from operations, its available cash balances and through its credit facility (as further discussed in Note 9 “Debt and Credit Agreements” of these consolidated financial statements), equipment financing and access to the public and private debt equity markets, and has the option to raise capital under the Company’s registration statement on Form S-3 (as discussed below). The Company uses the Credit Facility to fund working capital requirements. Under the Credit Facility, borrowings are continuous and all cash receipts are usually applied to the outstanding borrowed balance. As of December 31, 2019, cash and cash equivalents and short-term investments totaled $2,416, an increase of $1,239 from December 31, 2018. The Company had the ability to borrow up to $16,577 under the Credit Facility as of December 31, 2019. The Company also utilizes supply chain financing arrangements as a component of our funding for working capital, which accelerates receivable collections and helps to better manage cash flow. Under these agreements, the Company has agreed to sell certain of its accounts receivable balances to banking institutions who have agreed to advance amounts equal to the net accounts receivable balances due, less a discount as set forth in the respective agreements. The balances under these agreements are accounted for as sales of accounts receivable, as they are sold without recourse. Cash proceeds from these agreements are reflected as operating activities included in the change in accounts receivable in the Company's consolidated statements of cash flows. Fees incurred in connection with the agreements are recorded as interest expense by the Company. Debt and finance lease obligations at December 31, 2019 totaled $14,641 , which includes current outstanding debt and finance lease obligations totaling $13,463, over the next twelve months. The current outstanding debt includes $11,517 outstanding under the Credit Facility. On August 11, 2017, the Company filed a “shelf” registration statement on Form S-3, which was declared effective by the SEC on October 10, 2017 (the “Broadwind Form S-3”). This shelf registration statement, which includes a base prospectus, allows the Company at any time to offer any combination of securities described in the prospectus in one or more offerings. Unless otherwise specified in the prospectus supplement accompanying the Company’s base prospectus, the Company would use the net proceeds from the sale of any securities offered pursuant to the shelf registration statement for general corporate purposes. On July 31, 2018, the Company entered into an At Market Issuance Sales Agreement (the "ATM Agreement") with Roth Capital Partners, LLC (the “Agent”). Pursuant to the terms of the ATM Agreement, the Company may sell from time to time through the Agent shares of the Company's common stock, par value $0.001 per share with an aggregate sales price of up to $10,000. The Company will pay a commission to the Agent of 3% of the gross proceeds of the sale of the shares sold under the ATM Agreement and reimburse the Agent for the expenses of their counsel. During the year ended December 31, 2018, the Company issued 15,112 shares of the Company’s common stock under the ATM Agreement and the net proceeds (before upfront costs) to the Company from the sale of the Company’s common stock were approximately $33 after deducting commissions paid of approximately $1. As of December 31, 2019, the Company’s common stock having a value of approximately $9,967 remained available for issuance with respect to the ATM Agreement. The Company did not use the ATM Agreement in 2019. The Company anticipates that current cash resources, amounts available under the Credit Facility, cash to be generated from operations, equipment financing, and any potential proceeds from access to the public or private debt or equity markets, including the option to raise capital under the Broadwind Form S-3, will be adequate to meet the Company’s liquidity needs for at least the next twelve months. Summary of Significant Accounting Policies Management’s Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. (“GAAP”) requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reported period. Significant estimates, among others, include inventory reserves, warranty reserves, impairment of long-lived assets, allowance for doubtful accounts, health insurance reserves, and environmental reserves. Although these estimates are based upon management’s best knowledge of current events and actions that the Company may undertake in the future, actual results could differ from these estimates. Cash and Cash Equivalents and Short‑Term Investments Cash and cash equivalents typically comprise cash balances and readily marketable investments with original maturities of three months or less, such as money market funds, short‑term government bonds, Treasury bills, marketable securities and commercial paper. As of December 31, 2019 and December 31, 2018, cash totaled $2,416 and $1,177, respectively. For the years ended December 31, 2019 and 2018, interest income was $0 and $5, respectively. Revenue Recognition Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Customer deposits, deferred revenue and other receipts are deferred and recognized when the revenue is realized and earned. Cash payments to customers are presumed to be classified as reductions of revenue in the Company’s statement of operations. For many tower sales within the Company’s Heavy Fabrications segment, products are sold under terms included in bill and hold sales arrangements that result in different timing for revenue recognition versus shipment. The Company recognizes revenue under these arrangements only when there is a substantive reason for the agreement, the ordered goods are identified separately as belonging to the customer and not available to fill other orders, the goods are currently ready for physical transfer to the customer, and the Company does not have the ability to use the product or to direct it to another customer. Assuming these required revenue recognition criteria are met, revenue is recognized upon completion of product manufacture and customer acceptance. Cost of Sales Cost of sales represents all direct and indirect costs associated with the production of products for sale to customers. These costs include operation, repair and maintenance of equipment, materials, direct and indirect labor and benefit costs, rent and utilities, maintenance, insurance, equipment rentals, freight, and depreciation. Selling, General and Administrative Expenses Selling, general and administrative (“SG&A”) expenses include all corporate and administrative functions such as sales and marketing, legal, human resource management, finance, investor and public relations, information technology and senior management. These functions serve to support the Company’s current and future operations and provide an infrastructure to support future growth. Major expense items in this category include management and staff wages and benefits, share‑based compensation and professional services. Accounts Receivable (A/R) The Company generally grants uncollateralized credit to customers on an individual basis based upon the customer’s financial condition and credit history. Credit is typically on net 30 day terms and customer deposits are frequently required at various stages of the production process to finance customized products and minimize credit risk. Historically, the Company’s A/R is highly concentrated with a select number of customers. During the year ended December 31, 2019, the Company’s five largest customers accounted for 79% of its consolidated revenues and 55% of outstanding A/R balances, compared to the year ended December 31, 2018 when the Company’s five largest customers accounted for 78% of its consolidated revenues and 54% of its outstanding A/R balances. Allowance for Doubtful Accounts Based upon past experience and judgment, the Company establishes an allowance for doubtful accounts with respect to A/R. The Company’s standard allowance estimation methodology considers a number of factors that, based on its collections experience, the Company believes will have an impact on its credit risk and the realizability of its A/R. These factors include individual customer circumstances, history with the Company and other relevant criteria. A/R balances that remain outstanding after the Company has exhausted reasonable collection efforts are written off through a charge to the valuation allowance and a credit to A/R. The Company monitors its collections and write‑off experience to assess whether or not adjustments to its allowance estimates are necessary. Changes in trends in any of the factors that the Company believes may impact the realizability of its A/R, as noted above, or modifications to the Company’s credit standards, collection practices and other related policies may impact its allowance for doubtful accounts and its financial results. Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined either based on the first‑in, first‑out (“FIFO”) method, or on a standard cost basis that approximates the FIFO method. Market is determined based on net realizable value. Any excess of cost over net realizable value is included in the Company’s inventory allowance. Net realizable value of inventory, and management’s judgment of the need for reserves, encompasses consideration of other business factors including physical condition, inventory holding period, contract terms and usefulness. Inventories consist of raw materials, work‑in‑process and finished goods. Raw materials consist of components and parts for general production use. Work‑in‑process consists of labor and overhead, processing costs, purchased subcomponents and materials purchased for specific customer orders. Finished goods consist of components purchased from third parties as well as components manufactured by the Company that will be used to produce final customer products. Long-Lived Assets Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment is recognized using the straight‑line method over the estimated useful lives of the related assets for financial reporting purposes, and generally using an accelerated method for income tax reporting purposes. Depreciation expense related to property and equipment for the years ended December 31, 2019 and 2018 was $5,814 and $7,299, respectively. Expenditures for additions and improvements are capitalized, while replacements, maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed as incurred. The Company has in the past capitalized interest costs incurred on indebtedness used to construct property and equipment. Capitalized interest is recorded as part of the asset to which it relates and is amortized over the asset’s estimated useful life. There was no interest cost capitalized during the years ended December 31, 2019 or 2018. Property or equipment sold or disposed of is removed from the respective property accounts, with any corresponding gains and losses recorded within the operating results of the Company’s consolidated statement of operations. The Company reviews property and equipment and other long‑lived assets (“long-lived assets”) for impairment whenever events or circumstances indicate that carrying amounts may not be recoverable. Asset recoverability is first measured by comparing the assets’ carrying amounts to their expected future undiscounted net cash flows to determine if the assets are impaired. In evaluating the recoverability of long‑lived assets, the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of such assets. If the Company’s fair value estimates or related assumptions change in the future, the Company may be required to record impairment charges related to property and equipment and other long‑lived assets. If such assets are considered to be impaired, the impairment recognized is measured based on the amount by which the carrying amount of the assets exceeds the fair value. See Note 7, “Long-Lived Assets” of these consolidated financial statements for further discussion of long-lived assets. Leases The Company leases various property and equipment under operating lease arrangements. On January 1, 2019, the Company adopted ASU 2016-02, Leases (“Topic 842”) and ASU 2018-11 using the cumulative effect method. Adopting the standard resulted in the Company recognizing operating lease assets and liabilities on the balance sheet. Results for reporting periods beginning after January 1, 2019 are presented under Topic 842 while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historical accounting under legacy accounting. Rent expense for these types of leases is recognized on a straight‑line basis over the lease term. In addition, the Company has entered into finance lease arrangements to finance property and equipment and assumed finance lease obligations in connection with certain acquisitions. The cost basis and accumulated amortization of assets recorded under finance leases are included in property and equipment, while the liabilities are included in finance lease obligations. Warranty Liability The Company provides warranty terms that generally range from one to five years for various products and services relating to workmanship and materials supplied by the Company. In certain contracts, the Company has recourse provisions for items that would enable the Company to pursue recovery from third parties for amounts paid to customers under warranty provisions. Warranty liability is recorded in accrued liabilities within the consolidated balance sheet. The Company estimates the warranty accrual based on various factors, including historical warranty costs, current trends, product mix and sales. The changes in the carrying amount of the Company’s total product warranty liability for the years ended December 31, 2019 and 2018 were as follows, excluding activity related to the discontinued Services segment: As of December 31, 2019 2018 Balance, beginning of period $ 226 $ 581 Reduction of warranty reserve (32) (350) Warranty claims (21) (5) Other adjustments (10) — Balance, end of period $ 163 $ 226 Income Taxes The Company accounts for income taxes based upon an asset and liability approach. Deferred tax assets and liabilities represent the future tax consequences of the differences between the financial statement carrying amounts of assets and liabilities versus the tax basis of assets and liabilities. Under this method, deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The impact of tax rate changes on deferred tax assets and liabilities is recognized in the year that the change is enacted. In connection with the preparation of its consolidated financial statements, the Company is required to estimate its income tax liability for each of the tax jurisdictions in which the Company operates. This process involves estimating the Company’s actual current income tax expense and assessing temporary differences resulting from differing treatment of certain income or expense items for income tax reporting and financial reporting purposes. The Company also recognizes as deferred income tax assets the expected future income tax benefits of net operating loss (“NOL”) carryforwards. In evaluating the realizability of deferred income tax assets associated with NOL carryforwards, the Company considers, among other things, expected future taxable income, the expected timing of the reversals of existing temporary reporting differences and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Changes in, among other things, income tax legislation, statutory income tax rates or future taxable income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause its income tax provision to vary significantly among financial reporting periods. The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable pronouncement guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition related to the uncertainty in these income tax positions. Share‑Based Compensation The Company grants incentive stock options, restricted stock units (“RSUs”) and/or performance awards (“PSUs”) to certain officers, directors, and employees. The Company accounts for share‑based compensation related to these awards based on the estimated fair value of the equity award and recognizes expense ratably over the required vesting term of the award. The expense associated with PSUs is also based on the probability of achieving embedded targets. See Note 14 “Share‑Based Compensation” of these consolidated financial statements for further discussion of the Company’s share‑based compensation plans, the nature of share‑based awards issued and the Company’s accounting for share‑based compensation. Net Income (Loss) Per Share The Company presents both basic and diluted net income (loss) per share. Basic net income (loss) per share is based solely upon the weighted average number of common shares outstanding and excludes any dilutive effects of restricted stock, options, warrants and convertible securities. Diluted net income (loss) per share is based upon the weighted average number of common shares and common‑share equivalents outstanding during the year excluding those common‑share equivalents where the impact to basic net income (loss) per share would be anti‑dilutive. |
REVENUES
REVENUES | 12 Months Ended |
Dec. 31, 2019 | |
REVENUES | |
REVENUES | 2. REVENUES Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The following table presents the Company’s revenues disaggregated by revenue source for the years ended December 31, 2019 and 2018: For the Years Ended December 31, 2019 2018 Heavy Fabrications $ 128,686 $ 74,667 Gearing 34,877 38,376 Industrial Solutions 14,664 12,467 Eliminations (7) (130) Consolidated $ 178,220 $ 125,380 The Company’s revenue is generally recognized at a point in time, typically when control of the promised goods or services is transferred to its customers in an amount that reflects the consideration it expects to be entitled to in exchange for those goods or services. A performance obligation is a promise in a contract to transfer a distinct product or service to the customer. The Company measures revenue based on the consideration specified in the purchase order and revenue is recognized when the performance obligations are satisfied. If applicable, the transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. For many tower sales within the Company’s Heavy Fabrications segment, products are sold under terms included in bill and hold sales arrangements that result in different timing for revenue recognition versus shipment. The Company recognizes revenue under these arrangements only when there is a substantive reason for the arrangement, the ordered goods are identified separately as belonging to the customer and not available to fill other orders, the goods are currently ready for physical transfer to the customer, and the Company does not have the ability to use the product or to direct it to another customer. Assuming these required revenue recognition criteria are met, revenue is recognized upon completion of product manufacture and customer acceptance. The Company generally expenses sales commissions when incurred. These costs are recorded within selling, general and administrative expenses. Customer deposits, deferred revenue and other receipts are deferred and recognized when the revenue is realized and earned. Cash payments to customers are classified as reductions of revenue in the Company’s statement of operations. The Company does not disclose the value of the unsatisfied performance obligations for contracts with an original expected length of one year or less. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2019 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 3. EARNINGS PER SHARE The following table presents a reconciliation of basic and diluted earnings per share for the years ended December 31, 2019 and 2018 as follows: For the Years Ended December 31, 2019 2018 Basic earnings per share calculation: Net loss $ (4,523) $ (24,146) Weighted average number of common shares outstanding 16,127,296 15,468,975 Basic net loss per share $ (0.28) $ (1.56) Diluted earnings per share calculation: Net loss $ (4,523) $ (24,146) Weighted average number of common shares outstanding 16,127,296 15,468,975 Common stock equivalents: Stock options and non-vested stock awards (1) — — Weighted average number of common shares outstanding 16,127,296 15,468,975 Diluted net loss per share $ (0.28) $ (1.56) (1) Stock options and restricted stock units granted and outstanding of 1,411,277 and 862,706, respectively, are excluded from the computation of diluted earnings for the years ended December 31, 2019 and 2018 due to the anti‑dilutive effect as a result of the Company’s net loss for those respective periods. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 12 Months Ended |
Dec. 31, 2019 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
RECENT ACCOUNTING PRONOUNCEMENTS | 4. RECENT ACCOUNTING PRONOUNCEMENTS The Company reviews new accounting standards as issued. Although some of the accounting standards issued or effective in the current fiscal year may be applicable to it, the Company believes that none of the new standards have a significant impact on its consolidated financial statements. |
ALLOWANCE FOR DOUBTFUL ACCOUNTS
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 12 Months Ended |
Dec. 31, 2019 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 5. ALLOWANCE FOR DOUBTFUL ACCOUNTS The activity in the accounts receivable allowance from operations for the years ended December 31, 2019 and 2018 consists of the following: For the Years Ended December 31, 2019 2018 Balance at beginning of period $ 190 $ 225 Recoveries (27) (34) Write-offs (36) (1) Balance at end of period $ 127 $ 190 |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
INVENTORIES | 6. INVENTORIES The components of inventories from operations as of December 31, 2019 and 2018 are summarized as follows: As of December 31, 2019 2018 Raw materials $ 22,759 $ 16,394 Work-in-process 8,366 5,426 Finished goods 2,915 2,958 34,040 24,778 Less: Reserve for excess and obsolete inventory (2,177) (2,108) Net inventories $ 31,863 $ 22,670 |
LONG-LIVED ASSETS
LONG-LIVED ASSETS | 12 Months Ended |
Dec. 31, 2019 | |
LONG-LIVED ASSETS | |
LONG-LIVED ASSETS | 7. LONG-LIVED ASSETS The cost basis and estimated lives of property and equipment from continuing operations as of December 31, 2019 and 2018 are as follows: As of December 31, 2019 2018 Life Land $ 1,423 $ 1,423 Buildings 20,747 20,747 39 years Machinery and equipment 109,775 107,469 2 - 10 years Office furniture and equipment 4,597 4,387 3 - 7 years Leasehold improvements 8,974 8,974 Asset life or life of lease Construction in progress 1,093 172 146,609 143,172 Less accumulated depreciation and amortization (99,669) (94,085) Total property and equipment $ 46,940 $ 49,087 As of December 31, 2019 and December 31, 2018, the Company had commitments of $758 and $80, respectively, related to the completion of projects within construction in progress. Other intangible assets represent the fair value assigned to definite-lived assets such as trade names and customer relationships as part of the Company’s acquisition of Brad Foote completed in 2007 as well as the noncompetition agreements, trade names and customer relationships that were part of the Company’s acquisition of Red Wolf. Other intangible assets are amortized on a straight-line basis over their estimated useful lives, with a remaining life range from 3 to 8 years. During 2018, the Company recorded impairment charges of $12,585 associated with certain intangible assets recorded as part of the Red Wolf acquisition. The assets that were impaired related to the full amount of goodwill in the amount of $4,993 and the impairment of the customer relationship intangible in the amount of $7,592. These charges were recorded within the Company’s Industrial Solutions segment. During 2019, the Company also identified a triggering event associated with its continued operating losses within the Industrial Solutions segment. The Company relied upon an undiscounted cash flow analysis and concluded that no impairment to this asset group was indicated as of December 31, 2019. However, in conjunction with the Company’s rebranding initiative, during 2019 the Company decided it would no longer utilize the Red Wolf trade name. As a result, the Company accelerated the amortization of the trade name by $871 so that it was fully amortized in 2019. As of December 31, 2019 and 2018, the cost basis, accumulated amortization and net book value of intangible assets were as follows: December 31, 2019 December 31, 2018 Remaining Remaining Weighted Weighted Accumulated Net Average Accumulated Net Average Accumulated Impairment Book Amortization Accumulated Impairment Book Amortization Cost Amortization Charges Value Period Cost Amortization Charges Value Period Other intangible assets: Noncompete agreements $ $ (83) $ — $ 87 $ $ (54) $ — $ 116 Customer relationships 15,979 (6,674) (7,592) 1,713 5.8 15,979 (6,369) (7,592) 2,018 6.8 Trade names 9,099 (5,980) — 3,119 7.8 9,099 (4,631) — 4,468 9.5 Other intangible assets $ 25,248 $ (12,737) $ (7,592) $ 4,919 5.5 $ 25,248 $ (11,054) $ (7,592) $ 6,602 6.5 Intangible assets are amortized on a straight‑line basis over their estimated useful lives, which range from 6 to 20 years. Amortization expense was $1,683 and $1,884 for the years ended December 31, 2019 and 2018, respectively. As of December 31, 2019, estimated future amortization expense is as follows: 2020 $ 733 2021 733 2022 725 2023 664 2024 661 2025 and thereafter 1,403 Total $ 4,919 |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
ACCRUED LIABILITIES | |
ACCRUED LIABILITIES | 8. ACCRUED LIABILITIES Accrued liabilities as of December 31, 2019 and 2018 consisted of the following: December 31, 2019 2018 Accrued payroll and benefits $ 3,870 $ 2,126 Income taxes payable 61 66 Accrued professional fees 136 101 Accrued warranty liability 163 226 Self-insured workers compensation reserve 115 374 Accrued other 566 913 Total accrued liabilities $ 4,911 $ 3,806 |
DEBT AND CREDIT AGREEMENTS
DEBT AND CREDIT AGREEMENTS | 12 Months Ended |
Dec. 31, 2019 | |
DEBT AND CREDIT AGREEMENTS | |
DEBT AND CREDIT AGREEMENTS | 9. DEBT AND CREDIT AGREEMENTS The Company’s outstanding debt balances as of December 31, 2019 and 2018 consisted of the following: December 31, 2019 2018 Line of credit $ 11,517 $ 11,000 Other notes payable 1,563 1,882 Long-term debt 342 456 Less: Current portion (12,917) (11,930) Long-term debt, net of current maturities $ 505 $ 1,408 As of December 31, 2019, future annual principal payments on the Company’s outstanding debt obligations were as follows: 2020 $ 12,917 2021 275 2022 116 2023 114 2024 and thereafter — Total $ 13,422 Credit Facilities On October 26, 2016, the Company established a three-year secured revolving line of credit with CIBC Bank USA (“CIBC”). This line of credit has been amended from time to time. On February 25, 2019, the line of credit was expanded and extended for three years when the Company and its subsidiaries entered into an Amended and Restated Loan and Security Agreement (the “Amended and Restated Loan Agreement”), with CIBC as administrative agent and sole lead arranger and the other financial institutions party thereto (the “Lenders”), providing the Company and its subsidiaries with a $35,000 secured credit facility (the “Credit Facility”). The obligations under the Credit Facility are secured by, subject to certain exclusions, (i) a first priority security interest in all accounts receivable, inventory, equipment, cash and investment property, and (ii) a mortgage on the Abilene, Texas tower and Pittsburgh, Pennsylvania gearing facilities. The Credit Facility is an asset-based revolving credit facility, pursuant to which the Lenders advance funds against a borrowing base consisting of approximately (a) 85% of the face value of eligible receivables of the Company and the subsidiaries, plus (b) the lesser of (i) 50% of the lower of cost or market value of eligible inventory of the Company, (ii) 85% of the orderly liquidation value of eligible inventory and (iii) $12.5 million, plus (c) the lesser of (i) the sum of (A) 75% of the appraised net orderly liquidation value of the Company’s eligible machinery and equipment plus (B) 50% of the fair market value of the Company’s mortgaged property and (ii) $12 million. Subject to certain borrowing base conditions, the aggregate Credit Facility limit under the Amended and Restated Loan Agreement is $35 million with a sublimit for letters of credit of $10 million. Borrowings under the Credit Facility bear interest at a per annum rate equal to, at the option of the Company, the one, two or three-month LIBOR rate or the base rate, plus a margin. The applicable margin is 5.50% for LIBOR rate loans and 3.50% for base rates loans. Upon certain pay downs, a pricing grid based on the Company’s trailing twelve month fixed charge coverage ratio may become effective under which applicable margins would range from 2.25% to 2.75% for LIBOR rate loans and 0.00% to 0.75% for base rate loans. The Company must also pay an unused facility fee equal to 0.50% per annum on the unused portion of the Credit Facility along with other standard fees. The initial term of the Amended and Restated Loan Agreement ends on February 25, 2022. With the exception of the balance impacted by the interest rate swap (as described below), the Company is allowed to prepay in whole or in part advances under the Credit Facility without penalty or premium other than customary “breakage” costs with respect to LIBOR loans. The Amended and Restated Loan Agreement contains customary representations and warranties applicable to the Company and the subsidiaries. It also contains a requirement that the Company, on a consolidated basis, maintain minimum quarterly earnings before interest, taxes, depreciation, amortization, share-based payments, restructuring costs, and intangible impairments (“EBITDA”) levels through September 30, 2019 and a minimum quarterly fixed charge coverage ratio thereafter, along with other customary restrictive covenants, certain of which are subject to materiality thresholds, baskets and customary exceptions and qualifications. The Company was in compliance with all covenants under the Credit Facility as of December 31, 2019. In conjunction with the Amended and Restated Loan Agreement, during June 2019, the Company entered into a floating to fixed interest rate swap with CIBC. The swap agreement has a notional amount of $6,000 and a schedule matching that of the underlying loan that synthetically fixes the interest rate on LIBOR borrowings for the entire term of the Credit Facility at 2.13%, before considering the Company’s risk premium. The interest rate swap is accounted for using mark-to-market accounting. Accordingly, changes in the fair value of the swap each reporting period are adjusted through earnings, which may subject the Company’s results of operations to non-cash volatility. As of December 31, 2019, there was $11,517 outstanding under the Credit Facility. The Company had the ability to borrow up to $16,577 under the Credit Facility as of December 31, 2019. Other In 2016, the Company entered into a $570 loan agreement with the Development Corporation of Abilene which is included in long-term debt, less current maturities. The loan is forgivable upon the Company meeting and maintaining specific employment thresholds. During each of the years ended December 31, 2019 and 2018, $114 of the loan was forgiven. As of December 31, 2019, the loan balance was $342. In addition, the Company has outstanding notes payable for capital expenditures in the amount of $1,563 and $1,882 as of December 31, 2019 and 2018, respectively, with $1,400 and $930 included in the “Line of credit and other notes payable” line item of the Company’s consolidated financial statements as of December 31, 2019 and 2018, respectively. The notes payable have monthly payments that range from $1 to $36 and an interest rate of 5%. The equipment purchased is utilized as collateral for the notes payable. The outstanding notes payable have maturity dates that range from April 2020 to August 2022. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
LEASES | 10. LEASES The Company leases various property and equipment under operating lease arrangements. On January 1, 2019, the Company adopted Topic 842 and ASU 2018-11 using the cumulative effect method and has elected to apply each available practical expedient. The standard requires companies to recognize operating lease assets and liabilities on the balance sheet and to disclose key information regarding leasing arrangements. Results for reporting periods beginning after January 1, 2019 are presented under Topic 842 while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historical accounting under legacy accounting. ASU 2018-11 also allows an exception so that companies do not have to make the new required lease disclosures for periods before the effective date. The Company has elected to apply the short-term lease exception to all leases of one year or less. The adoption of Topic 842 resulted in the Company recognizing operating lease liabilities totaling $19,508 with a corresponding right-of-use (“ROU”) asset of $17,613 based on the present value of the minimum rental payments of such leases. The variance between the ROU asset balance and the lease liability is a deferred rent liability that existed prior to the adoption of Topic 842 and was offset against the ROU asset balance during the adoption. As of December 31, 2019, the ROU asset had a balance of $15,980 which is included in the “Operating lease right-of-use assets” line item of these consolidated financial statements and current and non-current lease liabilities relating to the ROU asset of $1,326 and $16,591, respectively, and are included in the “Current portion of operating lease obligations” and “Long-term operating lease obligations, net of current portion” line items of these consolidated financial statements. The discount rates used for leases accounted for under Topic 842 are based on an interest rate yield curve developed for the leases in the Company’s lease portfolio. Lease terms generally range from 3 to 15 years with renewal options for extended terms. Some of the Company’s facility leases include options to renew. The exercise of the renewal options is at the Company’s discretion. Therefore, the majority of renewals to extend the lease terms are not included in ROU assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options and includes them in the lease term when the Company is reasonably certain to exercise them. Certain leases contain rent escalation clauses that require additional rental payments in the later years of the term. Rent expense for these types of leases is recognized on a straight‑line basis over the lease term. Operating rental expense for the years ended December 31, 2019 and 2018 was $4,264 and $3,654, respectively. In addition, the Company has entered into finance lease arrangements to finance property and equipment and assumed finance lease obligations in connection with certain acquisitions. Finance rental expense for the years ended December 31, 2019 and 2018 was $666 and $572, respectively. Amortization expense recorded in connection with assets recorded under finance leases was $560 and $527 for the years ended December 31, 2019 and 2018, respectively. Quantitative information regarding the Company’s leases is as follows: For the Year Ended December 31, 2019 Components of lease cost Finance lease cost components: Amortization of finance lease assets $ 560 Interest on finance lease liabilities Total finance lease costs 666 Operating lease cost components: Operating lease cost 3,017 Short-term lease cost Variable lease cost (1) Sublease income (165) Total operating lease costs 4,264 Total lease cost $ 4,930 Supplemental cash flow information related to our operating leases is as follows for the year ended December 31, 2019: Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 3,505 Weighted-average remaining lease term-finance leases at 12/31/19 (in years) Weighted-average remaining lease term-operating leases at 12/31/19 (in years) Weighted-average discount rate-finance leases at 12/31/19 Weighted-average discount rate-operating leases at 12/31/19 (1) Variable lease costs consist primarily of taxes, insurance, utilities, and common area or other maintenance costs for the Company’s leased facilities and equipment. As of December 31, 2019, the Company had an additional operating lease of $4,380 that will commence during fiscal year 2020 and carries a lease term of ten years. As of December 31, 2019, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2020 $ 631 $ 2,914 $ 3,545 2021 501 2,772 3,273 2022 179 2,286 2,465 2023 29 2,268 2,297 2024 — 2,291 2,291 2025 and thereafter — 16,655 16,655 Total lease payments $ 1,340 $ 29,186 $ 30,526 Less—portion representing interest (121) (11,269) (11,390) Present value of lease obligations 1,219 17,917 19,136 Less—current portion of lease obligations (546) (1,326) (1,872) Long-term portion of lease obligations $ 673 $ 16,591 $ 17,264 As of December 31, 2018, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2019 $ 1,057 $ 3,524 $ 4,581 2020 376 2,784 3,160 2021 252 2,334 2,586 2022 — 2,333 2,333 2023 — 2,213 2,213 2024 and thereafter — 6,340 6,340 Total lease payments $ 1,685 $ 19,528 $ 21,213 Less—portion representing interest (147) Present value of lease obligations 1,538 Less—current portion of lease obligations (967) Long-term portion of lease obligations $ 571 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES Legal Proceedings From time to time, the Company is subject to legal proceedings or claims that arise in the ordinary course of its business. The Company accrues for costs related to loss contingencies when such costs are probable and reasonably estimable. As of December 31, 2019, the Company is not aware of any material pending legal proceedings or threatened litigation that would have a material adverse effect on the Company’s results of operations, financial condition or cash flows, although no assurance can be given with respect to the ultimate outcome of pending actions. Refer to Note 18, “Legal Proceedings” of these consolidated financial statements for further discussion of legal proceedings. Environmental Compliance and Remediation Liabilities The Company’s operations and products are subject to a variety of environmental laws and regulations in the jurisdictions in which the Company operates and sells products governing, among other things, air emissions, wastewater discharges, the use, handling and disposal of hazardous materials, soil and groundwater contamination, employee health and safety, and product content, performance and packaging. Also, certain environmental laws can impose the entire cost or a portion of the cost of investigating and cleaning up a contaminated site, regardless of fault, upon any one or more of a number of parties, including the current or previous owners or operators of the site. These environmental laws also impose liability on any person who arranges for the disposal or treatment of hazardous substances at a contaminated site. Third parties may also make claims against owners or operators of sites and users of disposal sites for personal injuries and property damage associated with releases of hazardous substances from those sites. Collateral In select instances, the Company has pledged specific inventory and machinery and equipment assets to serve as collateral on related payable or financing obligations. Warranty Liability The Company provides warranty terms that generally range from one to five years for various products and services relating to workmanship and materials supplied by the Company. In certain contracts, the Company has recourse provisions for items that would enable the Company to pursue recovery from third parties for amounts paid to customers under warranty provisions. Liquidated Damages In certain customer contracts, the Company has agreed to pay liquidated damages in the event of qualifying delivery or production delays. These damages are typically limited to a specific percentage of the value of the product in question and dependent on actual losses sustained by the customer. When the damages are determined to be probable and estimable, the damages are recorded as a reduction to revenue. During 2019 and 2018, the Company incurred no liquidated damages and there was no reserve for liquidated damages as of December 31, 2019. Workers’ Compensation Reserves As of December 31, 2019 and 2018, the Company had $115 and $374, respectively, accrued for self‑insured workers’ compensation liabilities. At the beginning of the third quarter of 2013, the Company began to self‑insure for its workers’ compensation liabilities, including reserves for self‑retained losses. The Company entered into a guaranteed workers’ compensation cost program at the beginning of the third quarter of 2016, but still maintains a liability for the trailing claims for the self-insured policy periods. Although the ultimate outcome of these matters may exceed the amounts recorded and additional losses may be incurred, the Company does not believe that any additional potential exposure for such liabilities will have a material adverse effect on the Company’s consolidated financial position or results of operations. Health Insurance Reserves As of December 31, 2019 and 2018, the Company had $344 and $450, respectively, accrued for health insurance liabilities. The Company self‑insures for its health insurance liabilities, including establishing reserves for self‑retained losses. Historical loss experience combined with actuarial evaluation methods and the application of risk transfer programs are used to determine required health insurance reserves. The Company takes into account claims incurred but not reported when determining its health insurance reserves. Health insurance reserves are included in accrued liabilities. While the Company’s management believes that it has adequately reserved for these claims, the ultimate outcome of these matters may exceed the amounts recorded and additional losses may be incurred. Other As of December 31, 2019, approximately 18% of the Company’s employees were covered by two collective bargaining agreements with local unions at the Company’s Cicero, Illinois and Neville Island, Pennsylvania locations. The current five-year collective bargaining agreement with the Neville Island union is expected to remain in effect through October 2022. During the third quarter of 2018, a new collective bargaining agreement was negotiated and ratified with the Cicero Union. The new four-year collective bargaining agreement with the Cicero union is expected to remain in effect through February 2022. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 12. FAIR VALUE MEASUREMENTS The Company measures its financial assets and liabilities at fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., exit price) in an orderly transaction between market participants at the measurement date. Additionally, the Company is required to provide disclosure and categorize assets and liabilities measured at fair value into one of three different levels depending on the assumptions (i.e., inputs) used in the valuation. Level 1 provides the most reliable measure of fair value while Level 3 generally requires significant management judgment. Financial assets and liabilities are classified in their entirety based on the lowest level of input significant to the fair value measurement. Financial instruments are assessed quarterly to determine the appropriate classification within the fair value hierarchy. Transfers between fair value classifications are made based upon the nature and type of the observable inputs. The fair value hierarchy is defined as follows: Level 1 — Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 — Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly. For the Company’s corporate and municipal bonds, although quoted prices are available and used to value said assets, they are traded less frequently. Level 3 — Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate of what market participants would use in valuing the asset or liability at the measurement date. Fair value of financial instruments The carrying amounts of the Company’s financial instruments, which include cash, restricted cash, A/R, accounts payable and customer deposits, approximate their respective fair values due to the relatively short-term nature of these instruments. Based upon interest rates currently available to the Company for debt with similar terms, the carrying value of the Company’s long-term debt is approximately equal to its fair value. The Company entered into an interest rate swap in June 2019 to mitigate the exposure to the variability of LIBOR for its floating rate debt described in Note 9, “Debt and Credit Agreements,” of these consolidated financial statements. The fair value of the interest rate swap is reported in “Accrued liabilities” and the change in fair value is reported in “Interest expense, net” of these consolidated financial statements. The fair value of the interest rate swap is estimated as the net present value of projected cash flows based on forward interest rates at the balance sheet date. The following tables represent the fair values of the Company’s financial assets measured as of December 31, 2019 and 2018: December 31, 2019 Level 1 Level 2 Level 3 Total Liabilities measured on a recurring basis: Interest rate swap $ — $ 78 $ — $ 78 Total liabilities at fair value $ — $ 78 $ — $ 78 December 31, 2018 Level 1 Level 2 Level 3 Total Assets measured on a nonrecurring basis: Customer relationships $ — $ — $ 1,852 $ 1,852 Total assets at fair value $ — $ — $ 1,852 $ 1,852 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
INCOME TAXES | 13. INCOME TAXES The provision for income taxes for the years ended December 31, 2019 and 2018 consists of the following: For the Years Ended December 31, 2019 2018 Current provision Federal $ — $ — Foreign — — State 57 98 Total current benefit 57 98 Deferred credit Federal (558) (3,978) State (453) (2,963) Total deferred credit (1,011) (6,941) Increase (decrease) in deferred tax valuation allowance 992 6,638 Total provision (benefit) for income taxes $ 38 $ (205) During the year ended December 31, 2019, the Company recorded an expense for income taxes of $38, compared to a benefit for income taxes of $205 during the year ended December 31, 2018. The total change in the deferred tax valuation allowance was $992 and $6,638 for the years ended December 31, 2019 and 2018, respectively. The changes in the deferred tax valuation allowances in 2019 and 2018 were primarily the result of increases to the deferred tax assets pertaining to federal and state NOLs. Management believes that significant uncertainty exists surrounding the recoverability of deferred tax assets. As a result, the Company recorded a valuation allowance against the deferred tax assets. The tax effects of the temporary differences and NOLs that give rise to significant portions of deferred tax assets and liabilities are as follows: As of December 31, 2019 2018 Noncurrent deferred income tax assets: Net operating loss carryforwards $ 67,014 $ 63,906 Intangible assets 5,040 7,261 Accrual and reserves 2,462 2,502 Other 77 19 Total noncurrent deferred tax assets 74,593 73,688 Valuation allowance (74,121) (73,129) Noncurrent deferred tax assets, net of valuation allowance 472 559 Noncurrent deferred income tax liabilities: Fixed assets 476 593 Total noncurrent deferred tax liabilities 476 593 Net deferred income tax liability $ (4) $ (34) Valuation allowances of $74,121 and $73,129 have been provided for deferred income tax assets for which realization is uncertain as of December 31, 2019 and 2018, respectively. A reconciliation of the beginning and ending amounts of the valuation is as follows: Valuation allowance as of December 31, 2018 $ (73,129) Gross increase for current year activity (992) Valuation allowance as of December 31, 2019 $ (74,121) As of December 31, 2019, the Company had federal and unapportioned state NOL carryforwards of approximately $258,834 of which $227,781 will begin to expire in 2026. The majority of the NOL carryforwards will expire in various years from 2028 through 2037. NOLs generated after January 1, 2018 will not expire. The reconciliation between the statutory U.S. federal income tax rate and the Company’s effective income tax rate is as follows: For the Year Ended December 31, 2019 2018 Statutory U.S. federal income tax rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 2.0 3.2 Permanent differences (0.4) (4.4) Change in valuation allowance (23.1) (18.7) Other (0.5) (0.3) Effective income tax rate (1.0) % 0.8 % The Company accounts for the uncertainty in income taxes by prescribing a minimum recognition threshold for a tax position taken, or expected to be taken, in a tax return that is required to be met before being recognized in the financial statements. The Company recognizes interest and penalties related to uncertain tax positions as income tax expense. As of December 31, 2019, the Company had no unrecognized tax benefits that could impact the income tax expense. The Company files income tax returns in the U.S. federal and state jurisdictions. As of December 31, 2019, open tax years in the federal and some state jurisdictions date back to 1996 due to the taxing authorities’ ability to adjust NOL carryforwards. The Company’s 2008 and 2009 federal tax returns were examined in 2011 and no material adjustments were identified related to any of the Company’s tax positions. Although these periods have been audited, they continue to remain open until all NOLs generated in those tax years have either been utilized or expire. Section 382 of the Internal Revenue Code of 1986, as amended (the “IRC”), generally imposes an annual limitation on the amount of NOL carryforwards and associated built‑in losses that may be used to offset taxable income when a corporation has undergone certain changes in stock ownership. The Company’s ability to utilize NOL carryforwards and built‑in losses may be limited, under this section or otherwise, by the Company’s issuance of common stock or by other changes in stock ownership. Upon completion of the Company’s analysis of IRC Section 382, the Company has determined that aggregate changes in stock ownership have resulted in an annual limitation of $14,284 on NOLs and built‑in losses available for utilization based on the triggering event in 2010. To the extent the Company’s use of NOL carryforwards and associated built‑in losses is significantly limited in the future due to additional changes in stock ownership, the Company’s income could be subject to U.S. corporate income tax earlier than it would if the Company were able to use NOL carryforwards and built‑in losses without such annual limitation, which could result in lower profits and the loss of the majority of the benefits from these attributes. In February 2013, the Company adopted a Stockholder Rights Plan, which was amended in February 2016 and approved by our stockholders (as amended, the “Rights Plan”), designed to preserve the Company’s substantial tax assets associated with NOL carryforwards under Section 382 of the IRC. On February 7, 2019, the Board of Directors (the “Board”) approved an amendment extending the Rights Plan for an additional three years, which was subsequently approved by the Company’s stockholders at the 2019 Annual Meeting of Stockholders held on April 23, 2019 (the “2019 Annual Meeting of Stockholders”). The Rights Plan is intended to act as a deterrent to any person or group, together with its affiliates and associates, being or becoming the beneficial owner of 4.9% or more of the Company’s common stock and thereby triggering a further limitation of the Company’s available NOL carryforwards. In connection with the adoption of the Rights Plan, the Board declared a non‑taxable dividend of one preferred share purchase right (a “Right”) for each outstanding share of the Company’s common stock to the Company’s stockholders of record as of the close of business on February 22, 2013. Each Right entitles its holder to purchase from the Company one one‑thousandth of a share of the Company’s Series A Junior Participating Preferred Stock at an exercise price of $4.25 per Right, subject to adjustment. As a result of the Rights Plan, any person or group that acquires beneficial ownership of 4.9% or more of the Company’s common stock without the approval of the Board would be subject to significant dilution in the ownership interest of that person or group. Stockholders who owned 4.9% or more of the outstanding shares of the Company’s common stock as of February 12, 2013 will not trigger the preferred share purchase rights unless they acquire additional shares after that date. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2019 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | 14. SHARE‑BASED COMPENSATION Overview of Share‑Based Compensation Plan The Company has granted incentive stock options and other equity awards pursuant to previously Board approved Equity Incentive Plans (“2007 and 2012 EIPs”). Most recently, the Company has granted equity awards pursuant to the Broadwind Energy, Inc. 2015 Equity Incentive Plan, which was approved by the Board in February 2015 and by the Company’s stockholders in April 2015. On February 19, 2019, the Board approved an Amended and Restated 2015 Equity Incentive Plan (as amended, the “2015 EIP,” and together with the 2007 and 2012 EIPs, the “Equity Incentive Plans”), which, among other things, increased the number of shares of our common stock authorized for issuance under the 2015 EIP from 1,100,000 to 2,200,000. The amendment and restatement of the 2015 EIP was approved by the Company’s stockholders at the 2019 Annual Meeting of Stockholders. The purposes of the Equity Incentive Plans are (a) to align the interests of the Company’s stockholders and recipients of awards by increasing the proprietary interest of such recipients in the Company’s growth and success; (b) to advance the interests of the Company by attracting and retaining officers, other employees, non-employee directors and independent contractors; and (c) to motivate such persons to act in the long-term best interests of the Company and its stockholders. Under the 2015 EIP, the Company may grant (i) non-qualified stock options; (ii) “incentive stock options” (within the meaning of Section 422 of the IRC); (iii) stock appreciation rights; (iv) restricted stock and restrictive stock units; and (v) performance awards. Stock Options. The exercise price of stock options granted under the Equity Incentive Plans is equal to the closing price of the Company’s common stock on the date of grant. Stock options generally become exercisable on the anniversary of the grant date, with vesting terms that may range from one to five years from the date of grant. Additionally, stock options expire ten years after the date of grant. The fair value of stock options granted is expensed ratably over their vesting term. Restricted Stock Units (RSUs). The granting of RSUs is provided for under the Equity Incentive Plans. RSUs generally contain a vesting period of one to five years from the date of grant. The fair value of each RSU granted is equal to the closing price of the Company’s common stock on the date of grant and is generally expensed ratably over the vesting term of the RSU award. Performance Awards (PSUs). The granting of PSUs is provided for under the Equity Incentive Plans. Vesting of PSUs is conditioned upon the Company meeting applicable performance measures over the performance period. The fair value of each PSU granted is equal to the closing price of the Company’s common stock on the date of grant and is generally expensed ratably over the term of the PSU award plan. The Equity Incentive Plans reserve shares of the Company’s common stock for grants to officers, directors, employees, consultants and advisors upon whose efforts the success of the Company and its affiliates depends to a large degree. The 2007 and 2012 EIPs reserved 1,891,051 shares of the Company’s common stock. As of December 31, 2019, 888,748 shares of common stock reserved for issuance pursuant to stock options and RSU awards granted under the 2007 and 2012 EIPs had been issued in the form of common stock, and 54,362 shares of common stock remained reserved for issuance upon the exercise of stock options outstanding under the 2007 and 2012 EIPs. The 2015 EIP reserves 2,200,000 shares of the Company’s common stock. As of December 31, 2019, 567,009 shares of common stock reserved for issuance pursuant to stock options and RSU awards granted under the 2015 EIP had been issued in the form of common stock and 1,356,915 shares of common stock remained reserved for issuance upon the exercise of stock options outstanding under the 2015 EIP. Stock option activity during the year ended December 31, 2019 under the Equity Incentive Plans was as follows: Weighted Average Aggregate Intrinsic Weighted Average Remaining Value Options Exercise Price Contractual Term (in thousands) Outstanding as of December 31, 2018 56,862 $ 15.06 $ — Expired (2,500) $ 99.90 — $ — Outstanding as of December 31, 2019 54,362 $ 11.16 1.81 $ — Exercisable as of December 31, 2019 54,362 $ 11.16 1.81 $ — The following table summarizes information with respect to all outstanding and exercisable stock options under the Equity Incentive Plans as of December 31, 2019: Options Outstanding Options Exercisable Weighted Average Number of options Weighted Average Remaining Number Weighted Average Exercise Price or Range outstanding Exercise Price Contractual Term Exercisable Exercise Price $3.39 - $13.50 49,039 $ 6.47 1.99 years 49,039 $ 6.47 $54.40 5,323 $ 54.40 0.19 years 5,323 $ 54.40 54,362 $ 11.16 1.81 years 54,362 $ 11.16 The fair value of each stock option award is estimated on the date of grant using the Black‑Scholes option pricing model. The determination of the fair value of each stock option is affected by the Company’s stock price on the date of grant, as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s expected stock price volatility over the expected life of the awards and actual and projected stock option exercise behavior. There were no stock options granted during the twelve months ended December 31, 2019 and 2018. The following table summarizes information with respect to outstanding RSUs and PSUs under the Equity Incentive Plans as of December 31, 2019 and 2018: Weighted Average Grant-Date Fair Value Number of Shares Per Share Unvested as of December 31, 2018 805,844 $ 3.16 Granted 905,321 $ 1.92 Vested (272,351) $ 3.05 Forfeited (81,899) $ 2.56 Unvested as of December 31, 2019 1,356,915 $ 2.39 RSUs and PSUs are generally subject to ratable vesting over a three-year period. Compensation expense related to these service-based awards is recognized on a straight-line basis over the vesting period. During the years ended December 31, 2019 and 2018, the Company utilized a forfeiture rate of 25% for estimating the forfeitures of stock compensation granted. The following table summarizes share‑based compensation expense, net of taxes withheld, included in the Company’s consolidated statements of operations for the years ended December 31, 2019 and 2018 as follows: For the Years Ended December 31, 2019 2018 Share-based compensation expense: Cost of sales $ 99 $ 99 Selling, general and administrative 859 704 Net effect of share-based compensation expense on net income $ 958 $ 803 Reduction in earnings per share: Basic earnings per share $ 0.06 $ 0.05 Diluted earnings per share $ 0.06 $ 0.05 (1) Income tax benefit is not illustrated because the Company is currently in a full tax valuation allowance position and an actual income tax benefit was not realized for the years ended December 31, 2019 and 2018. The result of the income (loss) situation creates a timing difference, resulting in a deferred tax asset, which is fully reserved for in the Company’s valuation allowance. As of December 31, 2019, the Company estimates that pre‑tax compensation expense for all unvested share‑based RSUs and PSUs in the amount of approximately $1,537 will be recognized through the year 2021. The Company expects to satisfy the exercise of stock options and future distribution of shares of restricted stock by issuing new shares of common stock. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2019 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | 15. SEGMENT REPORTING The Company is organized into reporting segments based on the nature of the products offered and business activities from which it earns revenues and incurs expenses for which discrete financial information is available and regularly reviewed by the Company’s chief operating decision maker. During the first quarter of 2019, the Company revised its segment presentation by moving its Abilene compressed natural gas and industrial fabrication business from the Industrial Solutions segment to the Heavy Fabrications segment. The Company believes that this change more appropriately aligns its businesses in terms of the nature of its products and services, as well as its production processes and customers. The Company has restated prior periods presented to reflect this change. In conjunction with the Company’s rebranding initiative, the Company renamed certain segments. See Note 1 “Description of Business and Summary of Significant Accounting Policies” of these consolidated financial statements for further discussion of the renamed segments. The Company’s segments and their product offerings are summarized below: Heavy Fabrications The Company provides large, complex and precision fabrications to customers in a broad range of industrial markets. The Company’s most significant presence is within the U.S. wind energy industry, although it has diversified into other industrial markets in order to improve capacity utilization, reduce customer concentrations, and reduce exposure to uncertainty related to governmental policies currently impacting the U.S. wind energy industry. Within the U.S. wind energy industry, the Company provides steel towers and adapters primarily to wind turbine manufacturers. Production facilities, located in Manitowoc, Wisconsin and Abilene, Texas, are situated in close proximity to the primary U.S. domestic wind energy and equipment manufacturing hubs. The two facilities have a combined annual tower production capacity of up to approximately 550 tower towers (1650 tower sections), sufficient to support turbines generating more than 1,100 MW of power. The Company has expanded production capabilities and leveraged manufacturing competencies, including welding, lifting capacity and stringent quality practices, into aftermarket and OEM components utilized in surface and underground mining, construction, material handling, O&G and other infrastructure markets. Gearing The Company provides gearing and gearboxes to a broad set of customers in diverse markets including; onshore and offshore O&G fracking and drilling, surface and underground mining, wind energy, steel, material handling and other infrastructure markets. The Company has manufactured loose gearing, gearboxes and systems, and provided heat treat services for aftermarket and OEM applications for nearly a century. The Company uses an integrated manufacturing process, which includes machining and finishing processes in Cicero, Illinois, and heat treatment in Neville Island, Pennsylvania. Industrial Solutions The Company provides supply chain solutions, inventory management, kitting and assembly services, primarily serving the combined cycle natural gas turbine market. Corporate and Other “Corporate” includes the assets and SG&A expenses of the Company’s corporate office. “Eliminations” comprises adjustments to reconcile segment results to consolidated results. The accounting policies of the reportable segments are the same as those referenced in Note 1, “Description of Business and Summary of Significant Accounting Policies” of these consolidated financial statements. Summary financial information by reportable segment is as follows: Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Year Ended December 31, 2019 Revenues from external customers $ 128,686 $ 34,877 $ 14,657 $ — $ — $ 178,220 Intersegment revenues — — 7 — (7) — Net revenues 128,686 34,877 14,664 — (7) 178,220 Operating profit (loss) 1,861 3,237 (1,059) (6,396) — (2,357) Depreciation and amortization 3,976 1,981 1,362 178 — 7,497 Capital expenditures 992 769 52 31 — 1,844 Total assets 41,432 47,022 8,893 239,629 (214,110) 122,866 Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Year Ended December 31, 2018 Revenues from external customers $ 74,625 $ 38,376 $ 12,379 $ — $ — $ 125,380 Intersegment revenues 42 — 88 — (130) — Net revenues 74,667 38,376 12,467 — (130) 125,380 Operating (loss) profit (5,440) 51 (15,348) (4,329) — (25,066) Depreciation and amortization 5,145 2,255 1,550 233 — 9,183 Capital expenditures 1,472 706 — 146 — 2,324 Total assets 34,839 37,028 11,758 243,867 (228,327) 99,165 The Company generates revenues entirely from transactions completed in the U.S. and its long‑lived assets are all located in the U.S. All intercompany revenue is eliminated in consolidation. During 2019, one customer accounted for more than 10% of total net revenues and had an accounts receivable balance greater than 10% of current assets. This customer accounted for revenues of $110,693 and account receivables of $8,428 for fiscal year 2019 and is reported within the Heavy Fabrications segment. At December 31, 2019, no other customer had an account receivables balance greater than 10% of current assets. During 2018, two customers accounted for more than 10% of total net revenues or $72,851 in revenue for fiscal year 2018, with one reported within the Heavy Fabrications segment and one reported within the Gearing segment. At December 31, 2018, no customer had an accounts receivable balance greater than 10% of current assets. During the years ended December 31, 2019 and 2018, five customers accounted for 79% and 78%, respectively, of total net revenues. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2019 | |
RETIREMENT SAVINGS AND PROFIT SHARING PLANS | |
EMPLOYEE BENEFIT PLANS | 16. EMPLOYEE BENEFIT PLANS Retirement Savings and Profit Sharing Plans Retirement Savings and Profit Sharing Plans The Company offers a 401(k) retirement savings plan to all eligible employees who may elect to contribute a portion of their salary on a pre‑tax basis, subject to applicable statutory limitations. As of December 31, 2019, all employees are eligible to receive safe harbor matching contributions equal to 100% of the first 3% of the participant’s elective deferral contributions and 50% of the next 2% of the participant’s elective deferral contributions. The Company has the discretion, subject to applicable statutory requirements, to fund any matching contribution with a contribution to the plan of the Company’s common stock. The Company periodically evaluates whether to fund the matching contribution in cash or in the Company’s common stock. Under the plan, elective deferrals and basic Company matching is 100% vested at all times. For the years ended December 31, 2019 and 2018, the Company recorded expense under these plans of approximately $1,002 and $812, respectively. Deferred Compensation Plan The Company maintains a deferred compensation plan for certain key employees and nonemployee directors, whereby certain wages earned, compensation for services rendered, and discretionary company‑matching contributions may be deferred and deemed to be invested in the Company’s common stock. Changes in the fair value of the plan liability are recorded as charges or credits to compensation expense. Compensation expense associated with the deferred compensation plan recorded during the years ended December 31, 2019 and 2018 was $3 and $(13). The fair value of the plan liability to the Company is included in accrued liabilities in the Company’s consolidated balance sheets. As of December 31, 2019 and 2018, the fair value of plan liability to the Company was $15 and $12, respectively. In addition to the employee benefit plans described above, the Company participates in certain customary employee benefits plans, including those which provide health and life insurance benefits to employees. |
QUARTERLY FINANCIAL SUMMARY (UN
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) | 12 Months Ended |
Dec. 31, 2019 | |
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) | |
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) | 17. QUARTERLY FINANCIAL SUMMARY (UNAUDITED) The following table provides a summary of selected financial results of operations by quarter for the years ended December 31, 2019 and 2018 as follows: 2019 First Second Third Fourth Revenues $ 41,660 $ 41,169 $ 46,138 $ 49,253 Gross profit 3,537 3,892 3,994 3,989 Operating loss (494) (206) (258) (1,399) Loss from continuing operations, net of tax (1,043) (1,018) (898) (1,627) Net loss (1,042) (1,018) (898) (1,565) Loss from continuing operations per share: Basic $ (0.07) $ (0.06) $ (0.06) $ (0.09) Diluted $ (0.07) $ (0.06) $ (0.06) $ (0.09) Net loss per share: Basic $ (0.07) $ (0.06) $ (0.06) $ (0.09) Diluted $ (0.07) $ (0.06) $ (0.06) $ (0.09) 2018 First Second Third Fourth Revenues $ 29,967 $ 36,781 $ 31,445 $ 27,187 Gross (loss) profit (132) 2,223 1,486 (512) Operating loss (4,537) (5,736) (2,612) (12,181) Loss from continuing operations, net of tax (4,811) (6,083) (750) (12,358) Net loss (4,838) (6,116) (783) (12,409) Loss from continuing operations per share: Basic $ (0.32) $ (0.40) $ (0.05) $ (0.79) Diluted $ (0.32) $ (0.40) $ (0.05) $ (0.79) Net loss per share: Basic $ (0.32) $ (0.40) $ (0.05) $ (0.79) Diluted $ (0.32) $ (0.40) $ (0.05) $ (0.79) |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 12 Months Ended |
Dec. 31, 2019 | |
LEGAL PROCEEDINGS | |
LEGAL PROCEEDINGS | 18. LEGAL PROCEEDINGS The Company is party to a variety of legal proceedings that arise in the normal course of its business. While the results of these legal proceedings cannot be predicted with certainty, management believes that the final outcome of these proceedings will not have a material adverse effect, individually or in the aggregate, on the Company’s results of operations, financial condition or cash flows. Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim or proceeding would not have a material adverse effect on the Company’s results of operations, financial condition or cash flows. It is possible that if one or more litigation matters were decided against the Company, the effects could be material to the Company’s results of operations in the period in which the Company would be required to record or adjust the related liability and could also be material to the Company’s financial condition and cash flows in the periods the Company would be required to pay such liability. |
RESTRUCTURING
RESTRUCTURING | 12 Months Ended |
Dec. 31, 2019 | |
RESTRUCTURING | |
RESTRUCTURING | 19. RESTRUCTURING During 2018, the Company conducted a review of its business strategies and product plans given the outlook of the industries it serves and its business environment. As a result, the Company executed a restructuring plan to rationalize its facility capacity and management structure, and to consolidate and increase the efficiencies of its Abilene facility operations. The Company exited the market for natural gas compression units and transferred remaining operations from a leased facility in Abilene, TX into other production locations. The Company vacated the leased Abilene facility in 2018 and incurred costs totaling $12 and $668 for the years ended December 31, 2019 and 2018, respectively. In conjunction with this initiative, all costs associated with this vacated facility were recorded as restructuring expenses within the Heavy Fabrications segment. Our restructuring activities concluded in 2019. The Company’s total net restructuring charges for the years ended December 31, 2019 and 2018 consist of the following: For the Years Ended December 31, 2019 2018 Cost of sales: Facility costs $ 2 $ 249 Moving and remediation 10 33 Salary and severance — 17 Depreciation — 332 Total cost of sales 12 631 Selling, general, and administrative expenses: Salary and severance — 37 Total selling, general, and administrative expenses — 37 Grand Total $ 12 $ 668 |
DESCRIPTION OF BUSINESS AND S_2
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Management's Use of Estimates | Management’s Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. (“GAAP”) requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities as of the date of the financial statements and reported amounts of revenues and expenses during the reported period. Significant estimates, among others, include inventory reserves, warranty reserves, impairment of long-lived assets, allowance for doubtful accounts, health insurance reserves, and environmental reserves. Although these estimates are based upon management’s best knowledge of current events and actions that the Company may undertake in the future, actual results could differ from these estimates. |
Cash and Cash Equivalents and Short-Term Investments | Cash and Cash Equivalents and Short‑Term Investments Cash and cash equivalents typically comprise cash balances and readily marketable investments with original maturities of three months or less, such as money market funds, short‑term government bonds, Treasury bills, marketable securities and commercial paper. As of December 31, 2019 and December 31, 2018, cash totaled $2,416 and $1,177, respectively. For the years ended December 31, 2019 and 2018, interest income was $0 and $5, respectively. |
Revenue Recognition | Revenue Recognition Revenues are recognized when control of the promised goods or services is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Customer deposits, deferred revenue and other receipts are deferred and recognized when the revenue is realized and earned. Cash payments to customers are presumed to be classified as reductions of revenue in the Company’s statement of operations. For many tower sales within the Company’s Heavy Fabrications segment, products are sold under terms included in bill and hold sales arrangements that result in different timing for revenue recognition versus shipment. The Company recognizes revenue under these arrangements only when there is a substantive reason for the agreement, the ordered goods are identified separately as belonging to the customer and not available to fill other orders, the goods are currently ready for physical transfer to the customer, and the Company does not have the ability to use the product or to direct it to another customer. Assuming these required revenue recognition criteria are met, revenue is recognized upon completion of product manufacture and customer acceptance. |
Cost of Sales | Cost of Sales Cost of sales represents all direct and indirect costs associated with the production of products for sale to customers. These costs include operation, repair and maintenance of equipment, materials, direct and indirect labor and benefit costs, rent and utilities, maintenance, insurance, equipment rentals, freight, and depreciation. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative (“SG&A”) expenses include all corporate and administrative functions such as sales and marketing, legal, human resource management, finance, investor and public relations, information technology and senior management. These functions serve to support the Company’s current and future operations and provide an infrastructure to support future growth. Major expense items in this category include management and staff wages and benefits, share‑based compensation and professional services. |
Accounts Receivable | Accounts Receivable (A/R) The Company generally grants uncollateralized credit to customers on an individual basis based upon the customer’s financial condition and credit history. Credit is typically on net 30 day terms and customer deposits are frequently required at various stages of the production process to finance customized products and minimize credit risk. Historically, the Company’s A/R is highly concentrated with a select number of customers. During the year ended December 31, 2019, the Company’s five largest customers accounted for 79% of its consolidated revenues and 55% of outstanding A/R balances, compared to the year ended December 31, 2018 when the Company’s five largest customers accounted for 78% of its consolidated revenues and 54% of its outstanding A/R balances. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts Based upon past experience and judgment, the Company establishes an allowance for doubtful accounts with respect to A/R. The Company’s standard allowance estimation methodology considers a number of factors that, based on its collections experience, the Company believes will have an impact on its credit risk and the realizability of its A/R. These factors include individual customer circumstances, history with the Company and other relevant criteria. A/R balances that remain outstanding after the Company has exhausted reasonable collection efforts are written off through a charge to the valuation allowance and a credit to A/R. The Company monitors its collections and write‑off experience to assess whether or not adjustments to its allowance estimates are necessary. Changes in trends in any of the factors that the Company believes may impact the realizability of its A/R, as noted above, or modifications to the Company’s credit standards, collection practices and other related policies may impact its allowance for doubtful accounts and its financial results. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost is determined either based on the first‑in, first‑out (“FIFO”) method, or on a standard cost basis that approximates the FIFO method. Market is determined based on net realizable value. Any excess of cost over net realizable value is included in the Company’s inventory allowance. Net realizable value of inventory, and management’s judgment of the need for reserves, encompasses consideration of other business factors including physical condition, inventory holding period, contract terms and usefulness. Inventories consist of raw materials, work‑in‑process and finished goods. Raw materials consist of components and parts for general production use. Work‑in‑process consists of labor and overhead, processing costs, purchased subcomponents and materials purchased for specific customer orders. Finished goods consist of components purchased from third parties as well as components manufactured by the Company that will be used to produce final customer products. |
Long-Lived Assets | Long-Lived Assets Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation and amortization of property and equipment is recognized using the straight‑line method over the estimated useful lives of the related assets for financial reporting purposes, and generally using an accelerated method for income tax reporting purposes. Depreciation expense related to property and equipment for the years ended December 31, 2019 and 2018 was $5,814 and $7,299, respectively. Expenditures for additions and improvements are capitalized, while replacements, maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed as incurred. The Company has in the past capitalized interest costs incurred on indebtedness used to construct property and equipment. Capitalized interest is recorded as part of the asset to which it relates and is amortized over the asset’s estimated useful life. There was no interest cost capitalized during the years ended December 31, 2019 or 2018. Property or equipment sold or disposed of is removed from the respective property accounts, with any corresponding gains and losses recorded within the operating results of the Company’s consolidated statement of operations. The Company reviews property and equipment and other long‑lived assets (“long-lived assets”) for impairment whenever events or circumstances indicate that carrying amounts may not be recoverable. Asset recoverability is first measured by comparing the assets’ carrying amounts to their expected future undiscounted net cash flows to determine if the assets are impaired. In evaluating the recoverability of long‑lived assets, the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of such assets. If the Company’s fair value estimates or related assumptions change in the future, the Company may be required to record impairment charges related to property and equipment and other long‑lived assets. If such assets are considered to be impaired, the impairment recognized is measured based on the amount by which the carrying amount of the assets exceeds the fair value. See Note 7, “Long-Lived Assets” of these consolidated financial statements for further discussion of long-lived assets. |
Leases | Leases The Company leases various property and equipment under operating lease arrangements. On January 1, 2019, the Company adopted ASU 2016-02, Leases (“Topic 842”) and ASU 2018-11 using the cumulative effect method. Adopting the standard resulted in the Company recognizing operating lease assets and liabilities on the balance sheet. Results for reporting periods beginning after January 1, 2019 are presented under Topic 842 while prior period amounts are not adjusted and continue to be reported in accordance with the Company’s historical accounting under legacy accounting. Rent expense for these types of leases is recognized on a straight‑line basis over the lease term. In addition, the Company has entered into finance lease arrangements to finance property and equipment and assumed finance lease obligations in connection with certain acquisitions. The cost basis and accumulated amortization of assets recorded under finance leases are included in property and equipment, while the liabilities are included in finance lease obligations. |
Warranty Liability | Warranty Liability The Company provides warranty terms that generally range from one to five years for various products and services relating to workmanship and materials supplied by the Company. In certain contracts, the Company has recourse provisions for items that would enable the Company to pursue recovery from third parties for amounts paid to customers under warranty provisions. Warranty liability is recorded in accrued liabilities within the consolidated balance sheet. The Company estimates the warranty accrual based on various factors, including historical warranty costs, current trends, product mix and sales. The changes in the carrying amount of the Company’s total product warranty liability for the years ended December 31, 2019 and 2018 were as follows, excluding activity related to the discontinued Services segment: As of December 31, 2019 2018 Balance, beginning of period $ 226 $ 581 Reduction of warranty reserve (32) (350) Warranty claims (21) (5) Other adjustments (10) — Balance, end of period $ 163 $ 226 |
Income Taxes | As of December 31, 2019 2018 Balance, beginning of period $ 226 $ 581 Reduction of warranty reserve (32) (350) Warranty claims (21) (5) Other adjustments (10) — Balance, end of period $ 163 $ 226 Income Taxes The Company accounts for income taxes based upon an asset and liability approach. Deferred tax assets and liabilities represent the future tax consequences of the differences between the financial statement carrying amounts of assets and liabilities versus the tax basis of assets and liabilities. Under this method, deferred tax assets are recognized for deductible temporary differences, and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The impact of tax rate changes on deferred tax assets and liabilities is recognized in the year that the change is enacted. In connection with the preparation of its consolidated financial statements, the Company is required to estimate its income tax liability for each of the tax jurisdictions in which the Company operates. This process involves estimating the Company’s actual current income tax expense and assessing temporary differences resulting from differing treatment of certain income or expense items for income tax reporting and financial reporting purposes. The Company also recognizes as deferred income tax assets the expected future income tax benefits of net operating loss (“NOL”) carryforwards. In evaluating the realizability of deferred income tax assets associated with NOL carryforwards, the Company considers, among other things, expected future taxable income, the expected timing of the reversals of existing temporary reporting differences and the expected impact of tax planning strategies that may be implemented to prevent the potential loss of future income tax benefits. Changes in, among other things, income tax legislation, statutory income tax rates or future taxable income levels could materially impact the Company’s valuation of income tax assets and liabilities and could cause its income tax provision to vary significantly among financial reporting periods. The Company also accounts for the uncertainty in income taxes related to the recognition and measurement of a tax position taken or expected to be taken in an income tax return. The Company follows the applicable pronouncement guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition related to the uncertainty in these income tax positions. |
Share-Based Compensation | Share‑Based Compensation The Company grants incentive stock options, restricted stock units (“RSUs”) and/or performance awards (“PSUs”) to certain officers, directors, and employees. The Company accounts for share‑based compensation related to these awards based on the estimated fair value of the equity award and recognizes expense ratably over the required vesting term of the award. The expense associated with PSUs is also based on the probability of achieving embedded targets. See Note 14 “Share‑Based Compensation” of these consolidated financial statements for further discussion of the Company’s share‑based compensation plans, the nature of share‑based awards issued and the Company’s accounting for share‑based compensation. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The Company presents both basic and diluted net income (loss) per share. Basic net income (loss) per share is based solely upon the weighted average number of common shares outstanding and excludes any dilutive effects of restricted stock, options, warrants and convertible securities. Diluted net income (loss) per share is based upon the weighted average number of common shares and common‑share equivalents outstanding during the year excluding those common‑share equivalents where the impact to basic net income (loss) per share would be anti‑dilutive. |
DESCRIPTION OF BUSINESS AND S_3
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of changes in the carrying amount of the total product warranty liability | As of December 31, 2019 2018 Balance, beginning of period $ 226 $ 581 Reduction of warranty reserve (32) (350) Warranty claims (21) (5) Other adjustments (10) — Balance, end of period $ 163 $ 226 |
REVENUES (Tables)
REVENUES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
REVENUES | |
Schedule of disaggregation of revenue | For the Years Ended December 31, 2019 2018 Heavy Fabrications $ 128,686 $ 74,667 Gearing 34,877 38,376 Industrial Solutions 14,664 12,467 Eliminations (7) (130) Consolidated $ 178,220 $ 125,380 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
EARNINGS PER SHARE | |
Reconciliation of basic and diluted earnings per share | For the Years Ended December 31, 2019 2018 Basic earnings per share calculation: Net loss $ (4,523) $ (24,146) Weighted average number of common shares outstanding 16,127,296 15,468,975 Basic net loss per share $ (0.28) $ (1.56) Diluted earnings per share calculation: Net loss $ (4,523) $ (24,146) Weighted average number of common shares outstanding 16,127,296 15,468,975 Common stock equivalents: Stock options and non-vested stock awards (1) — — Weighted average number of common shares outstanding 16,127,296 15,468,975 Diluted net loss per share $ (0.28) $ (1.56) (1) Stock options and restricted stock units granted and outstanding of 1,411,277 and 862,706, respectively, are excluded from the computation of diluted earnings for the years ended December 31, 2019 and 2018 due to the anti‑dilutive effect as a result of the Company’s net loss for those respective periods. |
ALLOWANCE FOR DOUBTFUL ACCOUN_2
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
Schedule of activity in the A/R allowance from continuing operations | For the Years Ended December 31, 2019 2018 Balance at beginning of period $ 190 $ 225 Recoveries (27) (34) Write-offs (36) (1) Balance at end of period $ 127 $ 190 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INVENTORIES | |
Schedule of the components of inventories from operations | As of December 31, 2019 2018 Raw materials $ 22,759 $ 16,394 Work-in-process 8,366 5,426 Finished goods 2,915 2,958 34,040 24,778 Less: Reserve for excess and obsolete inventory (2,177) (2,108) Net inventories $ 31,863 $ 22,670 |
LONG-LIVED ASSETS (Tables)
LONG-LIVED ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LONG-LIVED ASSETS | |
Schedule of cost basis and estimated lives of property and equipment from continuing operations | As of December 31, 2019 2018 Life Land $ 1,423 $ 1,423 Buildings 20,747 20,747 39 years Machinery and equipment 109,775 107,469 2 - 10 years Office furniture and equipment 4,597 4,387 3 - 7 years Leasehold improvements 8,974 8,974 Asset life or life of lease Construction in progress 1,093 172 146,609 143,172 Less accumulated depreciation and amortization (99,669) (94,085) Total property and equipment $ 46,940 $ 49,087 |
Schedule of the cost basis, accumulated amortization and net book value of intangible assets | December 31, 2019 December 31, 2018 Remaining Remaining Weighted Weighted Accumulated Net Average Accumulated Net Average Accumulated Impairment Book Amortization Accumulated Impairment Book Amortization Cost Amortization Charges Value Period Cost Amortization Charges Value Period Other intangible assets: Noncompete agreements $ $ (83) $ — $ 87 $ $ (54) $ — $ 116 Customer relationships 15,979 (6,674) (7,592) 1,713 5.8 15,979 (6,369) (7,592) 2,018 6.8 Trade names 9,099 (5,980) — 3,119 7.8 9,099 (4,631) — 4,468 9.5 Other intangible assets $ 25,248 $ (12,737) $ (7,592) $ 4,919 5.5 $ 25,248 $ (11,054) $ (7,592) $ 6,602 6.5 |
Schedule of estimated future amortization expense | 2020 $ 733 2021 733 2022 725 2023 664 2024 661 2025 and thereafter 1,403 Total $ 4,919 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
ACCRUED LIABILITIES | |
Schedule of accrued liabilities | December 31, 2019 2018 Accrued payroll and benefits $ 3,870 $ 2,126 Income taxes payable 61 66 Accrued professional fees 136 101 Accrued warranty liability 163 226 Self-insured workers compensation reserve 115 374 Accrued other 566 913 Total accrued liabilities $ 4,911 $ 3,806 |
DEBT AND CREDIT AGREEMENTS (Tab
DEBT AND CREDIT AGREEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
DEBT AND CREDIT AGREEMENTS | |
Schedule of outstanding debt balances | December 31, 2019 2018 Line of credit $ 11,517 $ 11,000 Other notes payable 1,563 1,882 Long-term debt 342 456 Less: Current portion (12,917) (11,930) Long-term debt, net of current maturities $ 505 $ 1,408 |
Schedule of future annual principal payments | 2020 $ 12,917 2021 275 2022 116 2023 114 2024 and thereafter — Total $ 13,422 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
LEASES | |
Schedule of Quantitative information regarding leases | For the Year Ended December 31, 2019 Components of lease cost Finance lease cost components: Amortization of finance lease assets $ 560 Interest on finance lease liabilities Total finance lease costs 666 Operating lease cost components: Operating lease cost 3,017 Short-term lease cost Variable lease cost (1) Sublease income (165) Total operating lease costs 4,264 Total lease cost $ 4,930 Supplemental cash flow information related to our operating leases is as follows for the year ended December 31, 2019: Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflow from operating leases $ 3,505 Weighted-average remaining lease term-finance leases at 12/31/19 (in years) Weighted-average remaining lease term-operating leases at 12/31/19 (in years) Weighted-average discount rate-finance leases at 12/31/19 Weighted-average discount rate-operating leases at 12/31/19 (1) Variable lease costs consist primarily of taxes, insurance, utilities, and common area or other maintenance costs for the Company’s leased facilities and equipment. |
Schedule of future minimum lease payments under finance leases and operating leases | As of December 31, 2019, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2020 $ 631 $ 2,914 $ 3,545 2021 501 2,772 3,273 2022 179 2,286 2,465 2023 29 2,268 2,297 2024 — 2,291 2,291 2025 and thereafter — 16,655 16,655 Total lease payments $ 1,340 $ 29,186 $ 30,526 Less—portion representing interest (121) (11,269) (11,390) Present value of lease obligations 1,219 17,917 19,136 Less—current portion of lease obligations (546) (1,326) (1,872) Long-term portion of lease obligations $ 673 $ 16,591 $ 17,264 As of December 31, 2018, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2019 $ 1,057 $ 3,524 $ 4,581 2020 376 2,784 3,160 2021 252 2,334 2,586 2022 — 2,333 2,333 2023 — 2,213 2,213 2024 and thereafter — 6,340 6,340 Total lease payments $ 1,685 $ 19,528 $ 21,213 Less—portion representing interest (147) Present value of lease obligations 1,538 Less—current portion of lease obligations (967) Long-term portion of lease obligations $ 571 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
FAIR VALUE MEASUREMENTS | |
Schedule of the fair values of the Company's financial assets | December 31, 2019 Level 1 Level 2 Level 3 Total Liabilities measured on a recurring basis: Interest rate swap $ — $ 78 $ — $ 78 Total liabilities at fair value $ — $ 78 $ — $ 78 December 31, 2018 Level 1 Level 2 Level 3 Total Assets measured on a nonrecurring basis: Customer relationships $ — $ — $ 1,852 $ 1,852 Total assets at fair value $ — $ — $ 1,852 $ 1,852 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
INCOME TAXES | |
Schedule of components of provision for income taxes | For the Years Ended December 31, 2019 2018 Current provision Federal $ — $ — Foreign — — State 57 98 Total current benefit 57 98 Deferred credit Federal (558) (3,978) State (453) (2,963) Total deferred credit (1,011) (6,941) Increase (decrease) in deferred tax valuation allowance 992 6,638 Total provision (benefit) for income taxes $ 38 $ (205) |
Schedule of tax effects of the temporary differences and NOL's that give rise to significant portions of deferred tax assets and liabilities | As of December 31, 2019 2018 Noncurrent deferred income tax assets: Net operating loss carryforwards $ 67,014 $ 63,906 Intangible assets 5,040 7,261 Accrual and reserves 2,462 2,502 Other 77 19 Total noncurrent deferred tax assets 74,593 73,688 Valuation allowance (74,121) (73,129) Noncurrent deferred tax assets, net of valuation allowance 472 559 Noncurrent deferred income tax liabilities: Fixed assets 476 593 Total noncurrent deferred tax liabilities 476 593 Net deferred income tax liability $ (4) $ (34) |
Schedule of reconciliation of the beginning and ending amounts of the valuation | Valuation allowance as of December 31, 2018 $ (73,129) Gross increase for current year activity (992) Valuation allowance as of December 31, 2019 $ (74,121) |
Schedule of reconciliation between the statutory U.S. federal income tax rate and the Company's effective income tax rate | For the Year Ended December 31, 2019 2018 Statutory U.S. federal income tax rate 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 2.0 3.2 Permanent differences (0.4) (4.4) Change in valuation allowance (23.1) (18.7) Other (0.5) (0.3) Effective income tax rate (1.0) % 0.8 % |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SHARE-BASED COMPENSATION | |
Schedule of stock option activity | Weighted Average Aggregate Intrinsic Weighted Average Remaining Value Options Exercise Price Contractual Term (in thousands) Outstanding as of December 31, 2018 56,862 $ 15.06 $ — Expired (2,500) $ 99.90 — $ — Outstanding as of December 31, 2019 54,362 $ 11.16 1.81 $ — Exercisable as of December 31, 2019 54,362 $ 11.16 1.81 $ — |
Summary of information with respect to all outstanding and exercisable stock options | Options Outstanding Options Exercisable Weighted Average Number of options Weighted Average Remaining Number Weighted Average Exercise Price or Range outstanding Exercise Price Contractual Term Exercisable Exercise Price $3.39 - $13.50 49,039 $ 6.47 1.99 years 49,039 $ 6.47 $54.40 5,323 $ 54.40 0.19 years 5,323 $ 54.40 54,362 $ 11.16 1.81 years 54,362 $ 11.16 |
Schedule of RSU activity | Weighted Average Grant-Date Fair Value Number of Shares Per Share Unvested as of December 31, 2018 805,844 $ 3.16 Granted 905,321 $ 1.92 Vested (272,351) $ 3.05 Forfeited (81,899) $ 2.56 Unvested as of December 31, 2019 1,356,915 $ 2.39 |
Schedule of share-based compensation expense, net of taxes withheld | For the Years Ended December 31, 2019 2018 Share-based compensation expense: Cost of sales $ 99 $ 99 Selling, general and administrative 859 704 Net effect of share-based compensation expense on net income $ 958 $ 803 Reduction in earnings per share: Basic earnings per share $ 0.06 $ 0.05 Diluted earnings per share $ 0.06 $ 0.05 (1) Income tax benefit is not illustrated because the Company is currently in a full tax valuation allowance position and an actual income tax benefit was not realized for the years ended December 31, 2019 and 2018. The result of the income (loss) situation creates a timing difference, resulting in a deferred tax asset, which is fully reserved for in the Company’s valuation allowance. |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SEGMENT REPORTING | |
Schedule of financial information by reportable segment | Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Year Ended December 31, 2019 Revenues from external customers $ 128,686 $ 34,877 $ 14,657 $ — $ — $ 178,220 Intersegment revenues — — 7 — (7) — Net revenues 128,686 34,877 14,664 — (7) 178,220 Operating profit (loss) 1,861 3,237 (1,059) (6,396) — (2,357) Depreciation and amortization 3,976 1,981 1,362 178 — 7,497 Capital expenditures 992 769 52 31 — 1,844 Total assets 41,432 47,022 8,893 239,629 (214,110) 122,866 Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Year Ended December 31, 2018 Revenues from external customers $ 74,625 $ 38,376 $ 12,379 $ — $ — $ 125,380 Intersegment revenues 42 — 88 — (130) — Net revenues 74,667 38,376 12,467 — (130) 125,380 Operating (loss) profit (5,440) 51 (15,348) (4,329) — (25,066) Depreciation and amortization 5,145 2,255 1,550 233 — 9,183 Capital expenditures 1,472 706 — 146 — 2,324 Total assets 34,839 37,028 11,758 243,867 (228,327) 99,165 |
QUARTERLY FINANCIAL SUMMARY (_2
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) | |
Summary of selected financial results of operations | 2019 First Second Third Fourth Revenues $ 41,660 $ 41,169 $ 46,138 $ 49,253 Gross profit 3,537 3,892 3,994 3,989 Operating loss (494) (206) (258) (1,399) Loss from continuing operations, net of tax (1,043) (1,018) (898) (1,627) Net loss (1,042) (1,018) (898) (1,565) Loss from continuing operations per share: Basic $ (0.07) $ (0.06) $ (0.06) $ (0.09) Diluted $ (0.07) $ (0.06) $ (0.06) $ (0.09) Net loss per share: Basic $ (0.07) $ (0.06) $ (0.06) $ (0.09) Diluted $ (0.07) $ (0.06) $ (0.06) $ (0.09) 2018 First Second Third Fourth Revenues $ 29,967 $ 36,781 $ 31,445 $ 27,187 Gross (loss) profit (132) 2,223 1,486 (512) Operating loss (4,537) (5,736) (2,612) (12,181) Loss from continuing operations, net of tax (4,811) (6,083) (750) (12,358) Net loss (4,838) (6,116) (783) (12,409) Loss from continuing operations per share: Basic $ (0.32) $ (0.40) $ (0.05) $ (0.79) Diluted $ (0.32) $ (0.40) $ (0.05) $ (0.79) Net loss per share: Basic $ (0.32) $ (0.40) $ (0.05) $ (0.79) Diluted $ (0.32) $ (0.40) $ (0.05) $ (0.79) |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
RESTRUCTURING | |
Schedule of total restructuring charges incurred to date and the total expected restructuring charges | For the Years Ended December 31, 2019 2018 Cost of sales: Facility costs $ 2 $ 249 Moving and remediation 10 33 Salary and severance — 17 Depreciation — 332 Total cost of sales 12 631 Selling, general, and administrative expenses: Salary and severance — 37 Total selling, general, and administrative expenses — 37 Grand Total $ 12 $ 668 |
DESCRIPTION OF BUSINESS AND S_4
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ / shares in Units, $ in Thousands | Jul. 31, 2018USD ($)$ / shares | Oct. 26, 2016 | Dec. 31, 2019USD ($)segment$ / shares | Dec. 31, 2019USD ($)$ / sharesMW | Dec. 31, 2019USD ($)facility$ / shares | Dec. 31, 2019USD ($)$ / shares | Dec. 31, 2019USD ($)item$ / shares | Dec. 31, 2019USD ($)$ / shares | Dec. 31, 2018USD ($)$ / sharesshares | Feb. 25, 2019USD ($) |
Description of Business | ||||||||||
Number of reportable segments | segment | 3 | |||||||||
Liquidity | ||||||||||
Cash and cash equivalents and short-term investments | $ 2,416 | $ 2,416 | $ 2,416 | $ 2,416 | $ 2,416 | $ 2,416 | ||||
Increase (decrease) in Cash and cash equivalents and Short-term investments | $ 1,239 | |||||||||
Current borrowing capacity | 16,577 | 16,577 | 16,577 | 16,577 | 16,577 | 16,577 | ||||
Outstanding indebtedness under the Credit Facility | 11,517 | 11,517 | 11,517 | 11,517 | 11,517 | 11,517 | 11,000 | |||
Inventories, net | 31,863 | 31,863 | 31,863 | 31,863 | 31,863 | 31,863 | 22,670 | |||
Increase (Decrease) in inventories | 9,193 | $ 2,944 | ||||||||
Total debt and capital lease obligations | $ 14,641 | $ 14,641 | $ 14,641 | $ 14,641 | $ 14,641 | 14,641 | ||||
Current outstanding debt and finance lease obligations | $ 13,463 | |||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | $ 0.001 | ||
Proceeds from issuance of stock | $ 33 | |||||||||
Sales agent commission percentage | 3.00% | |||||||||
Sale of common stock, net of expenses (shares) | shares | 15,112 | |||||||||
Commission paid to agent | $ 1 | |||||||||
ATM common stock available for issuance | $ 9,967 | $ 9,967 | $ 9,967 | $ 9,967 | $ 9,967 | $ 9,967 | ||||
NMTC note payable | 13,422 | 13,422 | 13,422 | 13,422 | 13,422 | 13,422 | ||||
Cash and Cash Equivalents and Short-Term Investments | ||||||||||
Cash | 2,416 | 2,416 | 2,416 | 2,416 | 2,416 | 2,416 | 1,177 | |||
Interest income | 0 | $ 5 | ||||||||
Credit facility | ||||||||||
Liquidity | ||||||||||
Maximum borrowing capacity | $ 35,000 | |||||||||
Maximum borrowing capacity of the face value of eligible receivable (as a percent) | 85.00% | |||||||||
Maximum percentage of lower of cost or market value of eligible inventories | 50.00% | |||||||||
Current borrowing capacity | 16,577 | 16,577 | 16,577 | 16,577 | 16,577 | 16,577 | ||||
Outstanding indebtedness under the Credit Facility | $ 11,517 | $ 11,517 | $ 11,517 | $ 11,517 | $ 11,517 | $ 11,517 | ||||
Interest rate base (as a percent) | 3.50% | |||||||||
Heavy Fabrications | ||||||||||
Description of Business | ||||||||||
Number of facilities | facility | 2 | |||||||||
Number of tower sections | 1,650 | 1,650 | ||||||||
Minimum | Heavy Fabrications | ||||||||||
Description of Business | ||||||||||
Power generating capacity of turbines that towers produced annually can support (in megawatts) | MW | 1,100 | |||||||||
Maximum | ||||||||||
Liquidity | ||||||||||
Proceeds from issuance of stock | $ 10,000 | |||||||||
Maximum | Heavy Fabrications | ||||||||||
Description of Business | ||||||||||
Annual tower production capacity (in towers) | item | 550 |
DESCRIPTION OF BUSINESS AND S_5
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - A/R, Allowances of A/R and PPE - (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($)item | Dec. 31, 2017USD ($) | |
Accounts Receivable | |||
Number of days for evaluating significant balances for credit risk | 30 days | ||
Number of largest customers | item | 5 | 5 | |
Allowance for Doubtful Accounts | |||
Bad debt (recoveries) expense | $ (27) | ||
Bad debt (recoveries) expense | $ 34 | ||
LONG-LIVED ASSETS | |||
Depreciation & amortization expense | $ 5,814 | 7,299 | |
Interest cost capitalized | $ 0 | $ 0 | |
Customer concentration | |||
Accounts Receivable | |||
Concentration risk (as a percent) | 79.00% | 78.00% | |
Accounts Receivable | Customer concentration | |||
Accounts Receivable | |||
Concentration risk (as a percent) | 55.00% | 54.00% |
DESCRIPTION OF BUSINESS AND S_6
DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Summary of Warranty Liability - (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in the carrying amount of the total product warranty liability | ||
Balance, beginning of period | $ 226 | $ 581 |
Reduction of warranty reserve | (32) | (350) |
Warranty claims | (21) | (5) |
Other adjustments | (10) | |
Balance, end of period | $ 163 | $ 226 |
Minimum | ||
Warranty Liability | ||
Term of warranty | 1 year | |
Maximum | ||
Warranty Liability | ||
Term of warranty | 5 years |
REVENUES (Details)
REVENUES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||||||||||
Revenues | $ 49,253 | $ 46,138 | $ 41,169 | $ 41,660 | $ 27,187 | $ 31,445 | $ 36,781 | $ 29,967 | $ 178,220 | $ 125,380 |
Revenue remaining performance obligation, practical expedient | true | |||||||||
Eliminations | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Revenues | $ (7) | (130) | ||||||||
Towers and Heavy Fabrications | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Revenues | 128,686 | 74,667 | ||||||||
Gearing | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Revenues | 34,877 | 38,376 | ||||||||
Industrial Solutions | ||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||
Revenues | $ 14,664 | $ 12,467 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
NET LOSS PER COMMON SHARE—BASIC: | ||||||||||
Net loss | $ (1,565) | $ (898) | $ (1,018) | $ (1,042) | $ (12,409) | $ (783) | $ (6,116) | $ (4,838) | $ (4,523) | $ (24,146) |
Weighted average number of common shares outstanding | 16,127,296 | 15,468,975 | ||||||||
Basic net loss per share | $ (0.09) | $ (0.06) | $ (0.06) | $ (0.07) | $ (0.79) | $ (0.05) | $ (0.40) | $ (0.32) | $ (0.28) | $ (1.56) |
NET LOSS PER COMMON SHARE—DILUTED: | ||||||||||
Net loss | $ (4,523) | $ (24,146) | ||||||||
Weighted average number of common shares outstanding | 16,127,296 | 15,468,975 | ||||||||
Weighted average number of common shares outstanding | 16,127,296 | 15,468,975 | ||||||||
Diluted net loss per share | $ (0.09) | $ (0.06) | $ (0.06) | $ (0.07) | $ (0.79) | $ (0.05) | $ (0.40) | $ (0.32) | $ (0.28) | $ (1.56) |
Stock options and restricted stock units granted and outstanding excluded from the computation of diluted earnings per share, due to the anti-dilutive effect (in shares) | 1,411,277 | 862,706 |
ALLOWANCE FOR DOUBTFUL ACCOUN_3
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Activity in the accounts receivable allowance from continuing operations | ||
Balance at beginning of period | $ 190 | $ 225 |
Recoveries | (34) | |
Bad debt (recoveries) expense | (27) | |
Write-offs | (36) | (1) |
Balance at end of period | $ 127 | $ 190 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
INVENTORIES | ||
Raw materials | $ 22,759 | $ 16,394 |
Work-in-process | 8,366 | 5,426 |
Finished goods | 2,915 | 2,958 |
Gross inventories | 34,040 | 24,778 |
Less: Reserve for excess and obsolete inventory | (2,177) | (2,108) |
Net inventories | $ 31,863 | $ 22,670 |
LONG-LIVED ASSETS (Details)
LONG-LIVED ASSETS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 146,609 | $ 143,172 |
Less-accumulated depreciation and amortization | (99,669) | (94,085) |
Property and equipment, net | 46,940 | 49,087 |
Commitments within construction in progress | $ 758 | 80 |
Minimum | ||
PROPERTY AND EQUIPMENT | ||
Estimated useful life | 6 years | |
Maximum | ||
PROPERTY AND EQUIPMENT | ||
Estimated useful life | 20 years | |
Land | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 1,423 | 1,423 |
Buildings | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 20,747 | 20,747 |
Life | 39 years | |
Machinery and equipment | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 109,775 | 107,469 |
Machinery and equipment | Minimum | ||
PROPERTY AND EQUIPMENT | ||
Life | 2 years | |
Machinery and equipment | Maximum | ||
PROPERTY AND EQUIPMENT | ||
Life | 10 years | |
Office furniture and equipment | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 4,597 | 4,387 |
Office furniture and equipment | Minimum | ||
PROPERTY AND EQUIPMENT | ||
Life | 3 years | |
Office furniture and equipment | Maximum | ||
PROPERTY AND EQUIPMENT | ||
Life | 7 years | |
Leasehold improvements | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 8,974 | 8,974 |
Construction in progress | ||
PROPERTY AND EQUIPMENT | ||
Property and equipment, gross | $ 1,093 | $ 172 |
Red Wolf | Minimum | ||
PROPERTY AND EQUIPMENT | ||
Estimated useful life | 3 years | |
Red Wolf | Maximum | ||
PROPERTY AND EQUIPMENT | ||
Estimated useful life | 8 years |
LONG-LIVED ASSETS - Intangible
LONG-LIVED ASSETS - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
INTANGIBLE ASSETS | ||
Goodwill. | $ 15,980 | |
Cost Basis | 25,248 | $ 25,248 |
Accumulated Amortization | (12,737) | (11,054) |
Net Book Value | $ 4,919 | $ 6,602 |
Remaining Weighted Average Amortization Period | 5 years 6 months | 6 years 6 months |
Accumulated Impairment Charges | $ (7,592) | $ (7,592) |
Amortization expense | 1,683 | 1,884 |
Estimated future amortization expense | ||
2020 | 733 | |
2021 | 733 | |
2022 | 725 | |
2023 | 664 | |
2024 | 661 | |
2025 and thereafter | 1,403 | |
Net Book Value | $ 4,919 | 6,602 |
Minimum | ||
INTANGIBLE ASSETS | ||
Estimated useful life | 6 years | |
Maximum | ||
INTANGIBLE ASSETS | ||
Estimated useful life | 20 years | |
Noncompete agreements | ||
INTANGIBLE ASSETS | ||
Cost Basis | $ 170 | 170 |
Accumulated Amortization | (83) | (54) |
Net Book Value | $ 87 | $ 116 |
Remaining Weighted Average Amortization Period | 3 years 1 month 6 days | 4 years 1 month 6 days |
Estimated future amortization expense | ||
Net Book Value | $ 87 | $ 116 |
Customer relationships | ||
INTANGIBLE ASSETS | ||
Cost Basis | 15,979 | 15,979 |
Accumulated Amortization | (6,674) | (6,369) |
Net Book Value | $ 1,713 | $ 2,018 |
Remaining Weighted Average Amortization Period | 5 years 9 months 18 days | 6 years 9 months 18 days |
Accumulated Impairment Charges | $ (7,592) | $ (7,592) |
Estimated future amortization expense | ||
Net Book Value | 1,713 | 2,018 |
Trade names | ||
INTANGIBLE ASSETS | ||
Cost Basis | 9,099 | 9,099 |
Accumulated Amortization | (5,980) | (4,631) |
Net Book Value | $ 3,119 | $ 4,468 |
Remaining Weighted Average Amortization Period | 7 years 9 months 18 days | 9 years 6 months |
Estimated future amortization expense | ||
Net Book Value | $ 3,119 | $ 4,468 |
Red Wolf | ||
INTANGIBLE ASSETS | ||
Impairment to identifiable intangible assets | 12,585 | |
Impairment of goodwill | 4,993 | |
Red Wolf | Minimum | ||
INTANGIBLE ASSETS | ||
Estimated useful life | 3 years | |
Red Wolf | Maximum | ||
INTANGIBLE ASSETS | ||
Estimated useful life | 8 years | |
Red Wolf | Customer relationships | ||
INTANGIBLE ASSETS | ||
Accumulated Impairment Charges | 7,592 | |
Red Wolf | Trade names | ||
INTANGIBLE ASSETS | ||
Accelerated amortization | $ 871 |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
ACCRUED LIABILITIES | |||
Accrued payroll and benefits | $ 3,870 | $ 2,126 | |
Income taxes payable | 61 | 66 | |
Accrued professional fees | 136 | 101 | |
Accrued warranty liability | 163 | 226 | $ 581 |
Accrued self-insurance reserve | 115 | 374 | |
Accrued other | 566 | 913 | |
Total accrued liabilities | $ 4,911 | $ 3,806 |
DEBT AND CREDIT AGREEMENTS (Det
DEBT AND CREDIT AGREEMENTS (Details) - USD ($) $ in Thousands | Feb. 25, 2019 | Oct. 26, 2016 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Dec. 31, 2016 |
Credit Facilities | ||||||
Line of credit | $ 11,517 | $ 11,000 | ||||
Less: Current portion | (12,917) | (11,930) | ||||
Long-term debt, net of current maturities | 505 | 1,408 | ||||
Future annual principal payments | ||||||
2020 | 12,917 | |||||
2021 | 275 | |||||
2022 | 116 | |||||
2023 | 114 | |||||
Total | 13,422 | |||||
Current borrowing capacity | 16,577 | |||||
Proceeds received form capital | 2,060 | |||||
Extinguishment gain | 2,249 | |||||
Amended and Restated Loan Agreement | ||||||
Future annual principal payments | ||||||
Swap agreement notional amount | $ 6,000 | |||||
Amended and Restated Loan Agreement | LIBOR | ||||||
Future annual principal payments | ||||||
Interest rate on notional amount of debt | 2.13% | |||||
Capital Expenditure loan | ||||||
Credit Facilities | ||||||
Long-term debt | $ 1,563 | 1,882 | ||||
Future annual principal payments | ||||||
Interest rate (as a percent) | 5.00% | |||||
Current maturities of long-term debt | $ 1,400 | 930 | ||||
Capital Expenditure loan | Minimum | ||||||
Future annual principal payments | ||||||
Monthly payments on notes payable | 1 | |||||
Capital Expenditure loan | Maximum | ||||||
Future annual principal payments | ||||||
Monthly payments on notes payable | 36 | |||||
Development Corporation of Abilene loan | ||||||
Credit Facilities | ||||||
Long-term debt | 342 | $ 456 | $ 570 | |||
Future annual principal payments | ||||||
Loan forgiven | 114 | |||||
Credit facility | ||||||
Credit Facilities | ||||||
Line of credit | 11,517 | |||||
Future annual principal payments | ||||||
Maximum borrowing capacity | $ 35,000 | |||||
Line of credit facilities, term of credit agreements | 3 years | |||||
Line of credit, term extended | 3 years | |||||
Maximum borrowing capacity of the face value of eligible receivable (as a percent) | 85.00% | |||||
Maximum percentage of lower of cost or market value of eligible inventories | 50.00% | |||||
Maximum percentage of orderly liquidation value of eligible inventories | 85.00% | |||||
Additional maximum borrowing capacity | $ 12,500 | |||||
Percentage of net orderly liquidation value | 75.00% | |||||
Percentage of fair market value of mortgaged property | 50.00% | |||||
Maximum borrowing restricted value | $ 12,000 | |||||
Interest rate base (as a percent) | 3.50% | |||||
Unused facility fee (as a percent) | 0.50% | |||||
Current borrowing capacity | $ 16,577 | |||||
Credit facility | LIBOR | ||||||
Future annual principal payments | ||||||
Interest rate margin (as a percent) | 5.50% | |||||
Credit facility | Minimum | LIBOR | ||||||
Future annual principal payments | ||||||
Interest rate margin (as a percent) | 2.25% | |||||
Interest rate (as a percent) | 0.00% | |||||
Credit facility | Maximum | LIBOR | ||||||
Future annual principal payments | ||||||
Interest rate margin (as a percent) | 2.75% | |||||
Interest rate (as a percent) | 0.75% | |||||
Credit facility | Amended and Restated Loan Agreement | ||||||
Future annual principal payments | ||||||
Maximum borrowing capacity | $ 35,000 | |||||
Credit facility | Letter of Credit | ||||||
Future annual principal payments | ||||||
Maximum borrowing capacity | $ 10,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 01, 2019 | |
Short-term lease exception term | 1 year | ||
Operating lease liabilities | $ 17,917 | $ 19,508 | |
Right-of-use (“ROU”) asset | $ 15,980 | $ 17,613 | |
Operating lease right-of-use asset | us-gaap:OperatingLeaseRightOfUseAsset | ||
Current operating lease liabilities | $ 1,326 | ||
Non-current operating lease liabilities | $ 16,591 | ||
Operating non-current lease liabilities | us-gaap:OperatingLeaseLiabilityNoncurrent | ||
Operating current lease liabilities | us-gaap:OperatingLeaseLiabilityCurrent | ||
Operating lease cost | $ 4,264 | $ 3,654 | |
Finance lease cost | 666 | 572 | |
Amortization of finance lease assets | $ 560 | $ 527 | |
Maximum | |||
Lease Term | 15 years | ||
Minimum | |||
Lease Term | 3 years | ||
Scenario, Actual [Member] | |||
Operating lease liabilities | $ 4,380 | ||
Lease Term | 10 years |
LEASES - Quantitative informati
LEASES - Quantitative information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Finance lease cost components | ||
Amortization of finance lease assets | $ 560 | $ 527 |
Interest on finance lease liabilities | 106 | |
Total finance lease costs | 666 | 572 |
Operating lease cost components: | ||
Operating lease cost | 3,017 | |
Short-term lease cost | 629 | |
Variable lease cost | 783 | |
Sublease income | (165) | |
Total operating lease costs | 4,264 | $ 3,654 |
Total lease cost | 4,930 | |
Supplemental cash flow information related to our operating leases is as follows for the nine months ended September 30, 2019: | ||
Operating cash outflow from operating leases | $ 3,505 | |
Weighted-average remaining lease term-finance leases (in years) | 1 year 1 month 6 days | |
Weighted-average remaining lease term-operating leases (in years) | 10 years 9 months 18 days | |
Weighted-average discount rate-finance leases | 8.40% | |
Weighted-average discount rate-operating leases | 9.00% |
LEASES - Future minimum lease p
LEASES - Future minimum lease payments under finance leases and operating leases - (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
Finance leases | |||
Due next twelve months | $ 631 | $ 1,057 | |
Due in two years | 501 | 376 | |
Due in three years | 179 | 252 | |
Due in four years | 29 | ||
Total lease payments | 1,340 | 1,685 | |
Less - portion representing interest | (121) | (147) | |
Present value of lease obligations | 1,219 | 1,538 | |
Less - Current portion of lease obligations | (546) | (967) | |
Long-term portion of lease obligations | 673 | 571 | |
Operating Leases | |||
Due next twelve months | 2,914 | 3,524 | |
Due in two years | 2,772 | 2,784 | |
Due in three years | 2,286 | 2,334 | |
Due in four years | 2,268 | 2,333 | |
Due in five years | 2,291 | 2,213 | |
Due thereafter | 16,655 | 6,340 | |
Total lease payments | 29,186 | 19,528 | |
Less - portion representing interest | (11,269) | ||
Present value of lease obligations | 17,917 | $ 19,508 | |
Less - current portion of lease obligations | (1,326) | ||
Non-current operating lease liabilities | 16,591 | ||
Total | |||
Due next twelve months | 3,545 | 4,581 | |
Due in two years | 3,273 | 3,160 | |
Due in three years | 2,465 | 2,586 | |
Due in four years | 2,297 | 2,333 | |
Due in five years | 2,291 | 2,213 | |
Due thereafter | 16,655 | 6,340 | |
Total lease payments | 30,526 | $ 21,213 | |
Less - portion representing interest | (11,390) | ||
Present value of lease obligations | 19,136 | ||
Less - current portion of lease obligations | (1,872) | ||
Long-term portion of lease obligations | $ 17,264 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Environmental Compliance and Remediation Liabilities | ||
Proceeds from sale of Cicero Avenue Facility | $ 1 | $ 676 |
Liquidated Damages | ||
Liquidated damages | 0 | $ 0 |
Reserve for liquidated damages | $ 0 | |
Minimum | ||
Warranty Liability | ||
Term of warranty | 1 year | |
Maximum | ||
Warranty Liability | ||
Term of warranty | 5 years |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Collective Bargaining Agreements (Details) - Coverage under collective bargaining agreements | 12 Months Ended |
Dec. 31, 2019agreement | |
Current collective bargaining agreement | |
Collective bargaining agreements | |
Term of agreement | 5 years |
New collective bargaining agreement | |
Collective bargaining agreements | |
Term of agreement | 4 years |
Total Company Employees | |
Collective bargaining agreements | |
Percentage of company's employees covered | 18.00% |
Number of agreements | 2 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Tax Credit Program and Worker's Compensation Reserves (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2019 | |
COMMITMENTS AND CONTINGENCIES | ||
Extinguishment gain | $ 2,249 | |
Workers' Compensation Reserves | ||
Amount accrued for self-insured workers' compensation claims | 374 | $ 115 |
Health Insurance Reserves | ||
Amount accrued for health insurance liabilities | $ 450 | $ 344 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Customer relationships | |
FAIR VALUE MEASUREMENTS | |
Total assets at fair value | $ 1,852 |
Level 3 | Customer relationships | |
FAIR VALUE MEASUREMENTS | |
Total assets at fair value | 1,852 |
Recurring | |
FAIR VALUE MEASUREMENTS | |
Total liabilities at fair value | 78 |
Recurring | Interest rate swap | |
FAIR VALUE MEASUREMENTS | |
Total liabilities at fair value | 78 |
Recurring | Level 2 | |
FAIR VALUE MEASUREMENTS | |
Total liabilities at fair value | 78 |
Recurring | Level 2 | Interest rate swap | |
FAIR VALUE MEASUREMENTS | |
Total liabilities at fair value | 78 |
Nonrecurring | |
FAIR VALUE MEASUREMENTS | |
Total assets at fair value | 1,852 |
Nonrecurring | Level 3 | |
FAIR VALUE MEASUREMENTS | |
Total assets at fair value | $ 1,852 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Current provision | ||
State | $ 57 | $ 98 |
Total current (benefit) provision | 57 | 98 |
Deferred credit | ||
Federal | (558) | (3,978) |
State | (453) | (2,963) |
Total deferred credit | (1,011) | (6,941) |
Increase (decrease) in deferred tax valuation allowance | 992 | 6,638 |
Total provision (benefit) for income taxes | $ 38 | $ (205) |
INCOME TAXES - Operating Loss C
INCOME TAXES - Operating Loss Carryforwards, Summary of Deferred Taxes and Temporary Tax Differences (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred income tax assets: | ||||
Intangible assets | $ 5,040 | $ 7,261 | ||
Accrual and reserves | 2,462 | 2,502 | ||
Other | 77 | 19 | ||
Total deferred tax assets | 74,593 | 73,688 | ||
Valuation allowance | $ (74,121) | $ (73,129) | (74,121) | (73,129) |
Deferred Tax Assets, Net of Valuation Allowance, Total | 472 | 559 | ||
Net operating loss carryforwards | 67,014 | 63,906 | ||
Deferred tax assets, net of valuation allowance | 472 | 559 | ||
Deferred income tax liabilities: | ||||
Fixed assets | 476 | 593 | ||
Total noncurrent deferred tax liabilities | 476 | 593 | ||
Net deferred income tax liability | (4) | $ (34) | ||
Reconciliation of the valuation allowances | ||||
Valuation allowance at the beginning of the period | (73,129) | |||
Gross increase for current year activity | (992) | (6,638) | ||
Valuation allowance at the end of the period | $ (74,121) | $ (73,129) | ||
Federal | ||||
Operating loss carryforwards | ||||
Net operating loss carryforwards | 258,834 | |||
State | ||||
Operating loss carryforwards | ||||
Net operating loss carryforwards | $ 227,781 |
INCOME TAXES - Tax Statutory Ra
INCOME TAXES - Tax Statutory Rate Reconciliation and Changes in Uncertain Income Tax Positions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of the tax (benefit) provision computed at the statutory rate to the effective tax rate | ||
Statutory U.S. federal income tax rate (as a percent) | 21.00% | 21.00% |
State and local income taxes, net of federal income tax benefit (as a percent) | 2.00% | 3.20% |
Permanent differences (as a percent) | (0.40%) | (4.40%) |
Change in valuation allowance (as a percent) | (23.10%) | (18.70%) |
Other (as a percent) | (0.50%) | (0.30%) |
Effective income tax rate (as a percent) | (1.00%) | 0.80% |
Deferred income taxes due, net | $ 472 | $ 559 |
Amount of unrecognized tax benefits that would affect the effective tax rate if the tax benefits were recognized | $ 0 |
INCOME TAXES - Tax Summary of S
INCOME TAXES - Tax Summary of Stockholder Rights Plan (Details) $ / shares in Units, $ in Thousands | Feb. 07, 2019 | Feb. 13, 2013item$ / sharesshares | Dec. 31, 2019USD ($) |
Rights Plan | |||
Extended term of Rights plan | 3 years | ||
Annual limitation on net operating losses | $ | $ 14,284 | ||
Series A Junior Participating Preferred Stock | |||
Rights Plan | |||
Number of rights for each outstanding share of common stock | item | 1 | ||
Number of preferred share purchase rights for each outstanding share of the company's common stock | shares | 0.001 | ||
Exercise price (in dollars per right) | $ / shares | $ 4.25 | ||
Series A Junior Participating Preferred Stock | Minimum | |||
Rights Plan | |||
Threshold percentage of beneficial ownership for significant dilution of ownership interest | 4.90% | ||
Current beneficial ownership percentage that will not trigger the preferred share purchase rights unless they acquire additional shares | 4.90% | ||
Series A Junior Participating Preferred Stock | Maximum | |||
Rights Plan | |||
Beneficial ownership percentage of any person or group, together with its affiliates and associates | 4.90% |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Feb. 19, 2019 | Feb. 18, 2019 | |
2012 and 2007 EIP | ||||
SHARE-BASED COMPENSATION | ||||
Number of shares of common stock reserved for grants | 1,891,051 | |||
Number of shares reserved | 54,362 | |||
Common stock issued under share-based compensation plan | 888,748 | |||
2015 EIP | ||||
SHARE-BASED COMPENSATION | ||||
Number of shares of common stock reserved for grants | 2,200,000 | 2,200,000 | 1,100,000 | |
Number of shares reserved | 1,356,915 | |||
Common stock issued under share-based compensation plan | 567,009 | |||
Stock Options | ||||
SHARE-BASED COMPENSATION | ||||
Expiration term | 10 years | |||
Summary of the stock option activity | ||||
Outstanding at the beginning of the period (in shares) | 56,862 | |||
Granted (in shares) | 0 | 0 | ||
Expired (in shares) | (2,500) | |||
Outstanding at the end of the period (in shares) | 54,362 | 56,862 | ||
Exercisable (in shares) | 54,362 | |||
Weighted Average Exercise Price | ||||
Outstanding at the beginning of the period (in dollars per share) | $ 15.06 | |||
Expired (in dollars per share) | 99.90 | |||
Outstanding at the end of the period (in dollars per share) | 11.16 | $ 15.06 | ||
Exercisable (in dollars per share) | $ 11.16 | |||
Weighted Average Remaining Contractual Term | ||||
Outstanding at the end of the period | 1 year 9 months 22 days | 2 years 8 months 19 days | ||
Exercisable | 1 year 9 months 22 days | |||
Stock Options | Minimum | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 1 year | |||
Stock Options | Maximum | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 5 years | |||
RSU | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 3 years | |||
Summary of the stock option activity | ||||
Outstanding at the beginning of the period (in shares) | 805,844 | |||
Outstanding at the end of the period (in shares) | 805,844 | |||
Weighted Average Exercise Price | ||||
Outstanding at the beginning of the period (in dollars per share) | $ 3.16 | |||
Outstanding at the end of the period (in dollars per share) | $ 3.16 | |||
RSU | Minimum | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 1 year | |||
RSU | Maximum | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 5 years | |||
PSU | ||||
SHARE-BASED COMPENSATION | ||||
Vesting term | 3 years |
SHARE-BASED COMPENSATION - Opti
SHARE-BASED COMPENSATION - Options Exercise Price Range, Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 54,362 |
Weighted Average Exercise Price (in dollars per share) | $ 11.16 |
Weighted Average Remaining Contractual Term | 1 year 9 months 22 days |
Options Exercisable | |
Number Exercisable (in shares) | shares | 54,362 |
Weighted Average Exercise Price (in dollars per share) | $ 11.16 |
$3.39-$13.50 | |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 49,039 |
Weighted Average Exercise Price (in dollars per share) | $ 6.47 |
Weighted Average Remaining Contractual Term | 1 year 11 months 27 days |
Options Exercisable | |
Number Exercisable (in shares) | shares | 49,039 |
Weighted Average Exercise Price (in dollars per share) | $ 6.47 |
$54.40-$99.90 | |
Outstanding and exercisable stock options under the EIP | |
Exercise price, low end of range (in dollars per share) | $ 54.40 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 5,323 |
Weighted Average Exercise Price (in dollars per share) | $ 54.40 |
Weighted Average Remaining Contractual Term | 2 months 9 days |
Options Exercisable | |
Number Exercisable (in shares) | shares | 5,323 |
Weighted Average Exercise Price (in dollars per share) | $ 54.40 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of Restricted Stock Units (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Stock Options | ||
Weighted Average Grant-Date Fair Value Per Share | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | 0 |
Forfeiture rate (as percent) | 25.00% | 25.00% |
RSU | ||
Summary of the restricted stock unit activity | ||
Granted (in shares) | 905,321 | |
Vested (in shares) | (272,351) | |
Forfeited (in shares) | (81,899) | |
Unvested at the end of the period (in shares) | 1,356,915 | |
Weighted Average Grant-Date Fair Value Per Share | ||
Granted (in dollars per share) | $ 1.92 | |
Vested (in dollars per share) | 3.05 | |
Forfeited (in dollars per share) | 2.56 | |
Unvested at the end of the period (in dollars per share) | $ 2.39 |
SHARE-BASED COMPENSATION - Su_2
SHARE-BASED COMPENSATION - Summary of Share-Based Compensation Expense (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Summary of share-based compensation expense | |||
Provision (benefit) for income taxes | $ 38 | $ (205) | |
Net effect of share-based compensation expense on net income | [1] | $ 958 | $ 803 |
Basic earnings per share | $ 0.06 | $ 0.05 | |
Diluted earnings per share | $ 0.06 | $ 0.05 | |
Pre-tax compensation expense for all unvested share-based awards | $ 1,537 | ||
Cost of sales | |||
Summary of share-based compensation expense | |||
Share-based compensation expense | 99 | $ 99 | |
Selling, general and administrative | |||
Summary of share-based compensation expense | |||
Share-based compensation expense | $ 859 | $ 704 | |
[1] | Income tax benefit is not illustrated because the Company is currently in a full tax valuation allowance position and an actual income tax benefit was not realized for the years ended December 31, 2019 and 2018. The result of the income (loss) situation creates a timing difference, resulting in a deferred tax asset, which is fully reserved for in the Company’s valuation allowance. |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)segment | Dec. 31, 2019USD ($)MW | Dec. 31, 2019USD ($)facility | Dec. 31, 2019USD ($)item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
SEGMENT REPORTING | ||||||||||||||
Number of reportable segments | segment | 3 | |||||||||||||
Revenues from external customers | $ 178,220 | $ 125,380 | ||||||||||||
Net revenues | $ 49,253 | $ 46,138 | $ 41,169 | $ 41,660 | $ 27,187 | $ 31,445 | $ 36,781 | $ 29,967 | 178,220 | 125,380 | ||||
Operating (loss) profit | (1,399) | $ (258) | $ (206) | $ (494) | (12,181) | $ (2,612) | $ (5,736) | $ (4,537) | (2,357) | (25,066) | ||||
Depreciation and amortization | 7,497 | 9,183 | ||||||||||||
Capital expenditures | 1,844 | 2,324 | ||||||||||||
Total Assets | 122,866 | 99,165 | $ 122,866 | $ 122,866 | $ 122,866 | $ 122,866 | 122,866 | 99,165 | ||||||
Eliminations | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Intersegment revenues | (7) | (130) | ||||||||||||
Net revenues | (7) | (130) | ||||||||||||
Total Assets | (214,110) | (228,327) | (214,110) | (214,110) | $ (214,110) | $ (214,110) | (214,110) | (228,327) | ||||||
Heavy Fabrications | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Number of facilities | facility | 2 | |||||||||||||
Number of tower sections | 1,650 | 1,650 | ||||||||||||
Revenues from external customers | 128,686 | 74,625 | ||||||||||||
Intersegment revenues | 42 | |||||||||||||
Net revenues | 128,686 | 74,667 | ||||||||||||
Operating (loss) profit | 1,861 | (5,440) | ||||||||||||
Depreciation and amortization | 3,976 | 5,145 | ||||||||||||
Capital expenditures | 992 | 1,472 | ||||||||||||
Total Assets | 41,432 | 34,839 | 41,432 | $ 41,432 | $ 41,432 | $ 41,432 | 41,432 | 34,839 | ||||||
Heavy Fabrications | Minimum | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Power generating capacity of turbines that towers produced annually can support (in megawatts) | MW | 1,100 | |||||||||||||
Heavy Fabrications | Maximum | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Annual tower production capacity (in towers) | item | 550 | |||||||||||||
Gearing | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Revenues from external customers | 34,877 | 38,376 | ||||||||||||
Net revenues | 34,877 | 38,376 | ||||||||||||
Operating (loss) profit | 3,237 | 51 | ||||||||||||
Depreciation and amortization | 1,981 | 2,255 | ||||||||||||
Capital expenditures | 769 | 706 | ||||||||||||
Total Assets | 47,022 | 37,028 | 47,022 | $ 47,022 | 47,022 | $ 47,022 | 47,022 | 37,028 | ||||||
Industrial Solutions | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Revenues from external customers | 14,657 | 12,379 | ||||||||||||
Intersegment revenues | 7 | 88 | ||||||||||||
Net revenues | 14,664 | 12,467 | ||||||||||||
Operating (loss) profit | (1,059) | (15,348) | ||||||||||||
Depreciation and amortization | 1,362 | 1,550 | ||||||||||||
Capital expenditures | 52 | |||||||||||||
Total Assets | 8,893 | 11,758 | 8,893 | 8,893 | 8,893 | 8,893 | 8,893 | 11,758 | ||||||
Corporate | ||||||||||||||
SEGMENT REPORTING | ||||||||||||||
Operating (loss) profit | (6,396) | (4,329) | ||||||||||||
Depreciation and amortization | 178 | 233 | ||||||||||||
Capital expenditures | 31 | 146 | ||||||||||||
Total Assets | $ 239,629 | $ 243,867 | $ 239,629 | $ 239,629 | $ 239,629 | $ 239,629 | $ 239,629 | $ 243,867 |
SEGMENT REPORTING - Summary of
SEGMENT REPORTING - Summary of Major Customers (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)customer | Dec. 31, 2018USD ($)customer | |
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 0 | |||||||||
Revenues from external customers | $ | $ 49,253 | $ 46,138 | $ 41,169 | $ 41,660 | $ 27,187 | $ 31,445 | $ 36,781 | $ 29,967 | $ 178,220 | $ 125,380 |
Accounts receivable, net | $ | 18,310 | $ 17,455 | 18,310 | $ 17,455 | ||||||
Heavy Fabrications | ||||||||||
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 1 | |||||||||
Revenues from external customers | $ | 128,686 | $ 74,667 | ||||||||
Gearing | ||||||||||
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 1 | |||||||||
Revenues from external customers | $ | $ 34,877 | $ 38,376 | ||||||||
Customer concentration | ||||||||||
SEGMENT REPORTING | ||||||||||
Concentration risk (as a percent) | 79.00% | 78.00% | ||||||||
Customer concentration | Accounts Receivable | ||||||||||
SEGMENT REPORTING | ||||||||||
Concentration risk (as a percent) | 55.00% | 54.00% | ||||||||
Customer concentration | Accounts Receivable | Minimum | ||||||||||
SEGMENT REPORTING | ||||||||||
Concentration risk (as a percent) | 10.00% | |||||||||
Customer One | Customer concentration | ||||||||||
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 2 | |||||||||
Customer One | Customer concentration | Heavy Fabrications | ||||||||||
SEGMENT REPORTING | ||||||||||
Revenues from external customers | $ | $ 110,693 | $ 72,851 | ||||||||
Accounts receivable, net | $ | $ 8,428 | $ 8,428 | ||||||||
Customer One | Customer concentration | Revenues | ||||||||||
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 1 | |||||||||
Customer One | Customer concentration | Revenues | Minimum | ||||||||||
SEGMENT REPORTING | ||||||||||
Concentration risk (as a percent) | 10.00% | 10.00% | ||||||||
Customer One | Customer concentration | Accounts Receivable | ||||||||||
SEGMENT REPORTING | ||||||||||
Concentration risk (as a percent) | 10.00% | |||||||||
Five customers | Customer concentration | Revenues | ||||||||||
SEGMENT REPORTING | ||||||||||
Number of major customers | customer | 5 | 5 | ||||||||
Concentration risk (as a percent) | 79.00% | 78.00% |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Compensation Arrangements [Abstract] | ||
Deferred Compensation Arrangement with Individual, Compensation Expense | $ 3 | $ (13) |
Deferred Compensation Arrangement with Individual, Recorded Liability | 15 | 12 |
Contribution expense | $ 1,002 | $ 812 |
Defined Contribution 401K Safe Harbor Plan [Member] | ||
Deferred Compensation Arrangements [Abstract] | ||
Matching contribution of first 3% of eligible employees' contributions (as a percent) | 100.00% | |
Employer match of employee contributions as first eligible compensation (as a percent) | 3.00% | |
Matching contribution of first 2% of eligible employees' contributions (as a percent) | 50.00% | |
Employer match of employee contributions as next eligible compensation (as a percent) | 2.00% | |
Elective deferrals and basic matching contribution vested (as a percent) | 100.00% |
QUARTERLY FINANCIAL SUMMARY (_3
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
QUARTERLY FINANCIAL SUMMARY (UNAUDITED) | ||||||||||
Revenues | $ 49,253 | $ 46,138 | $ 41,169 | $ 41,660 | $ 27,187 | $ 31,445 | $ 36,781 | $ 29,967 | $ 178,220 | $ 125,380 |
Gross (loss) profit | 3,989 | 3,994 | 3,892 | 3,537 | (512) | 1,486 | 2,223 | (132) | 15,412 | 3,065 |
Operating loss | (1,399) | (258) | (206) | (494) | (12,181) | (2,612) | (5,736) | (4,537) | (2,357) | (25,066) |
Loss from continuing operations, net of tax | (1,627) | (898) | (1,018) | (1,043) | (12,358) | (750) | (6,083) | (4,811) | (4,586) | (24,002) |
Net loss | $ (1,565) | $ (898) | $ (1,018) | $ (1,042) | $ (12,409) | $ (783) | $ (6,116) | $ (4,838) | $ (4,523) | $ (24,146) |
(Loss) income from continuing operations per share: | ||||||||||
Basic | $ (0.09) | $ (0.06) | $ (0.06) | $ (0.07) | $ (0.79) | $ (0.05) | $ (0.40) | $ (0.32) | $ (0.28) | $ (1.55) |
Diluted | (0.09) | (0.06) | (0.06) | (0.07) | (0.79) | (0.05) | (0.40) | (0.32) | (0.28) | (1.55) |
Diluted net loss per share | (0.09) | (0.06) | (0.06) | (0.07) | (0.79) | (0.05) | (0.40) | (0.32) | (0.28) | (1.56) |
Net (loss) income per share: | ||||||||||
Basic | (0.09) | (0.06) | (0.06) | (0.07) | (0.79) | (0.05) | (0.40) | (0.32) | (0.28) | (1.56) |
Diluted | $ (0.09) | $ (0.06) | $ (0.06) | $ (0.07) | $ (0.79) | $ (0.05) | $ (0.40) | $ (0.32) | $ (0.28) | $ (1.56) |
RESTRUCTURING (Details)
RESTRUCTURING (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CNG and Abilene Heavy Fabrications | ||
RESTRUCTURING | ||
Restructuring Charges | $ 12 | $ 668 |
CNG and Abilene Heavy Fabrications | Selling, general and administrative | ||
RESTRUCTURING | ||
Restructuring Charges | 37 | |
CNG and Abilene Heavy Fabrications | Facility costs | Cost of sales | ||
RESTRUCTURING | ||
Restructuring Charges | 2 | 249 |
CNG and Abilene Heavy Fabrications | Moving and remediation | Cost of sales | ||
RESTRUCTURING | ||
Restructuring Charges | 10 | 33 |
CNG and Abilene Heavy Fabrications | Salary and severance | Cost of sales | ||
RESTRUCTURING | ||
Restructuring Charges | 17 | |
CNG and Abilene Heavy Fabrications | Salary and severance | Selling, general and administrative | ||
RESTRUCTURING | ||
Restructuring Charges | 37 | |
CNG and Abilene Heavy Fabrications | Depreciation | Cost of sales | ||
RESTRUCTURING | ||
Restructuring Charges | 332 | |
Heavy Fabrications | Cost of sales | ||
RESTRUCTURING | ||
Restructuring Charges | $ 12 | $ 631 |