Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Entity Registrant Name | BROADWIND, INC. | |
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 | 16,640,043 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001120370 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash | $ 2,743 | $ 2,416 |
Accounts receivable, net | 16,244 | 18,310 |
Inventories, net | 40,754 | 31,863 |
Prepaid expenses and other current assets | 2,600 | 2,124 |
Total current assets | 62,341 | 54,713 |
LONG-TERM ASSETS: | ||
Property and equipment, net | 46,989 | 46,940 |
Operating lease right-of-use assets | 19,932 | 15,980 |
Intangible assets, net | 4,736 | 4,919 |
Other assets | 300 | 314 |
TOTAL ASSETS | 134,298 | 122,866 |
CURRENT LIABILITIES: | ||
Line of credit and other notes payable | 16,350 | 12,917 |
Current portion of finance lease obligations | 462 | 546 |
Current portion of operating lease obligations | 1,579 | 1,326 |
Accounts payable | 25,132 | 21,876 |
Accrued liabilities | 4,392 | 4,911 |
Customer deposits | 23,022 | 22,717 |
Total current liabilities | 70,937 | 64,293 |
LONG-TERM LIABILITIES: | ||
Long-term debt, net of current maturities | 355 | 505 |
Long-term finance lease obligations, net of current portion | 594 | 673 |
Long-term operating lease obligations, net of current portion | 20,324 | 16,591 |
Other | 66 | 44 |
Total long-term liabilities | 21,339 | 17,813 |
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; 16,913,980 and 16,830,930 shares issued as of March 31, 2020, and December 31, 2019, respectively | 17 | 17 |
Treasury stock, at cost, 273,937 shares as of March 31, 2020 and December 31, 2019 | (1,842) | (1,842) |
Additional paid-in capital | 383,669 | 383,361 |
Accumulated deficit | (339,822) | (340,776) |
Total stockholders’ equity | 42,022 | 40,760 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 134,298 | $ 122,866 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
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 | 16,913,980 | 16,830,930 |
Treasury stock, common shares | 273,937 | 273,937 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
Revenues | $ 48,634 | $ 41,660 |
Cost of sales | 42,462 | 38,111 |
Restructuring | 12 | |
Gross profit | 6,172 | 3,537 |
OPERATING EXPENSES: | ||
Selling, general and administrative | 4,309 | 3,828 |
Intangible amortization | 183 | 203 |
Total operating expenses | 4,492 | 4,031 |
Operating income (loss) | 1,680 | (494) |
OTHER EXPENSE, net: | ||
Interest expense, net | (673) | (536) |
Other, net | (1) | (1) |
Total other expense, net | (674) | (537) |
Net income (loss) before provision for income taxes | 1,006 | (1,031) |
Provision for income taxes | 52 | 11 |
NET INCOME (LOSS) | $ 954 | $ (1,042) |
NET INCOME (LOSS) PER COMMON SHARE—BASIC: | ||
Net income (loss) (in dollars per share) | $ 0.06 | $ (0.07) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-BASIC (in shares) | 16,596,236 | 15,785,954 |
NET INCOME ( LOSS) PER COMMON SHARE—DILUTED: | ||
Net income (loss) (in dollars per share) | $ 0.06 | $ (0.07) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING-DILUTED (in shares) | 16,733,274 | 15,785,954 |
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, 2018 | $ 16 | $ (1,842) | $ 381,441 | $ (336,253) | $ 43,362 |
Balance (in shares) at Dec. 31, 2018 | 15,982,622 | (273,937) | |||
Increase (Decrease) in Stockholders' Equity | |||||
Stock issued for restricted stock (in shares) | 141,384 | ||||
Stock issued under defined contribution 401(k) retirement savings plan | 187 | 187 | |||
Stock issued under defined contribution 401(k) retirement savings plan (in shares) | 135,636 | ||||
Share-based compensation | 255 | 255 | |||
Net income (loss) | (1,042) | (1,042) | |||
Balance at Mar. 31, 2019 | $ 16 | $ (1,842) | 381,883 | (337,295) | 42,762 |
Balance (in shares) at Mar. 31, 2019 | 16,259,642 | (273,937) | |||
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 | ||
Increase (Decrease) in Stockholders' Equity | |||||
Stock issued for restricted stock (in shares) | 83,050 | ||||
Share-based compensation | 308 | $ 308 | |||
Net income (loss) | 954 | 954 | |||
Balance at Mar. 31, 2020 | $ 17 | $ (1,842) | $ 383,669 | $ (339,822) | $ 42,022 |
Balance (in shares) at Mar. 31, 2020 | 16,913,980 | (273,937) | 16,913,980 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ 954 | $ (1,042) |
Adjustments to reconcile net cash used in operating activities: | ||
Depreciation and amortization expense | 1,612 | 1,761 |
Deferred income taxes | 22 | (9) |
Change in fair value of interest rate swap agreements | 138 | |
Stock-based compensation | 308 | 255 |
Allowance for doubtful accounts | 29 | (14) |
Common stock issued under defined contribution 401(k) plan | 187 | |
Gain on disposal of assets | (1) | |
Changes in operating assets and liabilities, net of acquisition: | ||
Accounts receivable | 2,037 | (5,040) |
Inventories | (8,891) | (10,274) |
Prepaid expenses and other current assets | (476) | 70 |
Accounts payable | 3,545 | 8,132 |
Accrued liabilities | (657) | 321 |
Customer deposits | 305 | (5,752) |
Other non-current assets and liabilities | 49 | 57 |
Net cash used in operating activities | (1,025) | (11,349) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (670) | (577) |
Proceeds from disposals of property and equipment | 1 | |
Net cash used in investing activities of continuing operations | (670) | (576) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from line of credit | 51,552 | 42,440 |
Payments on line of credit | (49,070) | (31,191) |
Payments on long-term debt | (242) | (228) |
Principal payments on finance leases | (218) | (236) |
Net cash provided by financing activities | 2,022 | 10,785 |
NET INCREASE (DECREASE) IN CASH | 327 | (1,140) |
CASH beginning of the period | 2,416 | 1,177 |
CASH end of the period | $ 2,743 | $ 37 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2020 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | NOTE 1 — BASIS OF PRESENTATION The unaudited condensed consolidated financial statements presented herein include the accounts of Broadwind, Inc. (the “Company”) and its wholly-owned subsidiaries Broadwind Heavy Fabrications, Inc. (“Broadwind Heavy Fabrications”), Brad Foote Gear Works, Inc. (“Brad Foote”) and Broadwind Industrial Solutions, LLC (“Broadwind Industrial Solutions”). All intercompany transactions and balances have been eliminated. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the financial statements do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments, including normal recurring accruals, considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the twelve months ending December 31, 2020. The December 31, 2019 condensed consolidated balance sheet was derived from audited financial statements, but does not include all disclosures required by GAAP. This financial information should be read in conjunction with the consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. There have been no material changes in the Company’s significant accounting policies during the three months ended March 31, 2020 as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Company Description Through its subsidiaries, the Company is a precision manufacturer of structures, equipment and components for clean technology 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 capabilities include, but are not limited to the following: heavy fabrications, welding, metal rolling, coatings, gear cutting and shaping, heat treatment, assembly, engineering and packaging solutions. The Company’s most significant presence is within the U.S. wind energy industry, which accounted for 74% of the Company’s revenue during the first three months of 2020. Liquidity The Company meets its short term liquidity needs through cash generated from operations, its available cash balances, the Credit Facility (as defined below), equipment financing, and access to the public or private debt and equity markets and has the option to raise capital under the Company’s Form S-3 (as discussed below). See Note 7, “Debt and Credit Agreements,” of these condensed consolidated financial statements for a complete description of the Credit Facility and the Company’s other debt. Total debt and finance lease obligations at March 31, 2020 totaled $17,761, which includes current outstanding debt and finance leases totaling $16,812. The current outstanding debt includes $14,000 outstanding under the Company’s revolving line of credit. On August 11, 2017, the Company filed a “shelf” registration statement on Form S-3, which was declared effective by the Securities and Exchange Commission (the “SEC”) on October 10, 2017 (the “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 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. As of March 31, 2020, the Company’s common stock having a value of approximately $9,967 remained available for issuance with respect to the ATM Agreement. The Company has not used the ATM Agreement in 2019 or 2020. In April 2020, the Company received funds under notes and related documents with CIBC under the new U.S. Paycheck Protection Program. For additional discussion, refer to Note 16, “Subsequent Events” of these condensed consolidated financial statements. The Company anticipates that current cash resources, amounts available under the Credit Facility, the loans received by the Company under the U.S. Payroll Protection Program, cash to be generated from operations and any potential proceeds from the sale of further Company securities under the Form S-3 will be adequate to meet the Company’s liquidity needs for at least the next twelve months. However, the Company does not anticipate that it will have the ability to generate a significant amount of capital from equity markets in the near-term as a result of the low trading volume of the Company’s common stock on the NASDAQ exchange and limitations on the aggregate amount of securities the Company may offer under the Form S-3 due to its public float size. The Form S-3 will expire on October 10, 2020. If assumptions regarding the Company’s production, sales and subsequent collections from certain of the Company’s large customers, as well as customer deposits and revenues generated from new customer orders, are materially inconsistent with management’s expectations, the Company may in the future encounter cash flow and liquidity issues. If the Company’s operational performance deteriorates significantly, it may be unable to comply with existing financial covenants, and could lose access to the Credit Facility. This could limit the Company’s operational flexibility, require a delay in making planned investments and/or require the Company to seek additional equity or debt financing. Any additional equity financing, if available, may be dilutive to stockholders, and additional debt financing, if available, would likely require new financial covenants or impose other restrictions on the Company. While the Company believes that it will continue to have sufficient cash available to operate its businesses and to meet its financial obligations and debt covenants, there can be no assurances that its operations will generate sufficient cash, or that credit facilities will be available in an amount sufficient to enable the Company to meet these financial obligations. Management’s Use of Estimates The preparation of financial statements in conformity with 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 revenue recognition, future cash flows, inventory reserves, warranty reserves, impairment of long-lived assets, allowance for doubtful accounts and health insurance 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. |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2020 | |
REVENUES | |
REVENUES | NOTE 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 three months ended March 31, 2020 and 2019: Three Months Ended March 31, 2020 2019 Heavy Fabrications $ 38,368 $ 28,294 Gearing 6,227 10,027 Industrial Solutions 4,039 3,339 Consolidated $ 48,634 $ 41,660 Revenue within the Company’s Gearing and Industrial Solutions segments, as well as industrial fabrication revenues within the Heavy Fabrications segment, are 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. 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. 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 | 3 Months Ended |
Mar. 31, 2020 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | NOTE 3 — EARNINGS PER SHARE The following table presents a reconciliation of basic and diluted earnings per share for the three months ended March 31, 2020 and 2019, as follows: Three Months Ended March 31, 2020 2019 Basic earnings per share calculation: Net income (loss) $ 954 $ (1,042) Weighted average number of common shares outstanding 16,596,236 15,785,954 Basic net income (loss) per share $ 0.06 $ (0.07) Diluted earnings per share calculation: Net income (loss) $ 954 $ (1,042) Weighted average number of common shares outstanding 16,596,236 15,785,954 Common stock equivalents: Non-vested stock awards (1) 137,038 — Weighted average number of common shares outstanding 16,733,274 15,785,954 Diluted net income (loss) per share $ 0.06 $ (0.07) (1) Stock options and restricted stock units granted and outstanding of 683,019 as of March 31, 2019 are excluded from the computation of diluted earnings due to the anti-dilutive effect as a result of the Company’s net loss for three months ended March 31, 2019. |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
INVENTORIES | NOTE 4 — INVENTORIES The components of inventories as of March 31, 2020 and December 31, 2019 are summarized as follows: March 31, December 31, 2020 2019 Raw materials $ 24,325 $ 22,759 Work-in-process 11,496 8,366 Finished goods 6,926 2,915 42,747 34,040 Less: Reserve for excess and obsolete inventory (1,993) (2,177) Net inventories $ 40,754 $ 31,863 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2020 | |
INTANGIBLE ASSETS. | |
INTANGIBLE ASSETS | NOTE 5 — INTANGIBLE ASSETS 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 Company, LLC. 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. As of March 31, 2020 and December 31, 2019, the cost basis, accumulated amortization and net book value of intangible assets were as follows: March 31, 2020 December 31, 2019 Remaining Remaining Weighted Weighted Accumulated Net Average Accumulated Net Average Cost Accumulated Impairment Book Amortization Accumulated Impairment Book Amortization Basis Amortization Charges Value Period Cost Amortization Charges Value Period Intangible assets: Noncompete agreements $ $ (90) $ — $ 80 2.8 $ $ (83) $ — $ 87 Customer relationships 15,979 (6,750) (7,592) 1,637 5.6 15,979 (6,674) (7,592) 1,713 5.8 Trade names 9,099 (6,080) — 3,019 7.5 9,099 (5,980) — 3,119 7.8 Intangible assets $ 25,248 $ (12,920) $ (7,592) $ 4,736 6.3 $ 25,248 $ (12,737) $ (7,592) $ 4,919 6.5 As of March 31, 2020, estimated future amortization expense is as follows: 2020 $ 550 2021 733 2022 725 2023 664 2024 661 2025 and thereafter 1,403 Total $ 4,736 |
ACCRUED LIABILITIES
ACCRUED LIABILITIES | 3 Months Ended |
Mar. 31, 2020 | |
ACCRUED LIABILITIES | |
ACCRUED LIABILITIES | NOTE 6 — ACCRUED LIABILITIES Accrued liabilities as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, December 31, 2020 2019 Accrued payroll and benefits $ 3,256 $ 3,870 Fair value of interest rate swap 216 78 Accrued property taxes 158 — Income taxes payable 69 61 Accrued professional fees 91 136 Accrued warranty liability 118 163 Self-insured workers compensation reserve 112 115 Accrued other 372 488 Total accrued liabilities $ 4,392 $ 4,911 |
DEBT AND CREDIT AGREEMENTS
DEBT AND CREDIT AGREEMENTS | 3 Months Ended |
Mar. 31, 2020 | |
DEBT AND CREDIT AGREEMENTS | |
DEBT AND CREDIT AGREEMENTS | NOTE 7 — DEBT AND CREDIT AGREEMENTS The Company’s outstanding debt balances as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, December 31, 2020 2019 Line of credit $ 14,000 $ 11,517 Other notes payable 2,363 1,563 Long-term debt 342 342 Less: Current portion (16,350) (12,917) Long-term debt, net of current maturities $ 355 $ 505 Credit Facility 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 defined 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 a minimum quarterly fixed charge coverage ratio 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 financial covenants as of March 31, 2020. In conjunction with the Amended and Restated Loan Agreement, in 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. The interest rate swap liability is included in the “Accrued liabilities” line item of the Company’s condensed consolidated financial statements as of March 31, 2020 and December 31, 2019. As of March 31, 2020, there was $14,000 of outstanding indebtedness under the Credit Facility, with the ability to borrow an additional $16,283, under the Credit Facility. Other In 2016, the Company entered into a $570 loan agreement with the Development Corporation of Abilene which is included in the “Long-term debt, less current maturities” line item of our condensed consolidated financial statements as of March 31, 2020 and December 31, 2019. The loan is forgivable upon the Company meeting and maintaining specific employment thresholds. During each of the years 2019 and 2018, $114 of the loan was forgiven. As of March 31, 2020, the loan balance was $342. In addition, the Company has outstanding notes payable for capital expenditures in the amount of $2,363 and $1,563 as of March 31, 2020 and December 31, 2019, respectively, with $2,350 and $1,400 included in the “Line of credit and other notes payable” line item of the Company’s condensed consolidated financial statements as of March 31, 2020 and December 31, 2019, respectively. The notes payable have monthly payments that range from $1 to $36 and an interest rate of approximately 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. In April 2020, the Company received loans totaling $9,530 as part of the 2020 Coronavirus Aid, Relief and Economic Stability Act. Please refer to Note 16, “Subsequent Events” of these condensed consolidated financial statements for additional details. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2020 | |
LEASES | |
LEASES | NOTE 8 — LEASES The Company leases certain facilities and equipment. On January 1, 2019, the Company adopted ASU 2016-02, Leases (“Topic 842”) and ASU 2018-11 using the cumulative effect method and has elected to apply each available practical expedient. 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. The discount rates used for leases accounted for under ASC 842 are based on an interest rate yield curve developed for the leases in the Company’s lease portfolio. Quantitative information regarding the Company’s leases is as follows: For the Three Months Ended March 31, 2020 March 31, 2019 Components of lease cost Finance lease cost components: Amortization of finance lease assets $ 129 $ 136 Interest on finance lease liabilities Total finance lease costs 155 165 Operating lease cost components: Operating lease cost 765 786 Short-term lease cost Variable lease cost (1) Sublease income (45) (44) Total operating lease costs 1,047 1,066 Total lease cost $ 1,202 $ 1,231 Supplemental cash flow information related to our operating leases is as follows for the three months ended March 31, 2020 and 2019: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases Operating cash outflow from operating leases $ 888 $ 875 Weighted-average remaining lease term-finance leases at end of period (in years) Weighted-average remaining lease term-operating leases at end of period (in years) Weighted-average discount rate-finance leases at end of period Weighted-average discount rate-operating leases at end of period (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 March 31, 2020, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2020 $ 409 $ 2,628 $ 3,037 2021 527 3,387 3,914 2022 202 2,902 3,104 2023 34 2,884 2,918 2024 — 2,906 2,906 2025 and thereafter — 20,119 20,119 Total lease payments 1,172 34,826 35,998 Less—portion representing interest (116) (12,923) (13,039) Present value of lease obligations 1,056 21,903 22,959 Less—current portion of lease obligations (462) (1,579) (2,041) Long-term portion of lease obligations $ 594 $ 20,324 $ 20,918 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 9 — FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, 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 7, “Debt and Credit Agreements,” of these condensed 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 condensed 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 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. The following tables represent the fair values of the Company’s financial liabilities as of March 31, 2020 and December 31, 2019: March 31, 2020 Level 1 Level 2 Level 3 Total Liabilities measured on a recurring basis: Interest rate swap $ — $ 216 $ — $ 216 Total liabilities at fair value $ — $ 216 $ — $ 216 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 |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2020 | |
INCOME TAXES | |
INCOME TAXES | NOTE 10 — INCOME TAXES Effective tax rates differ from federal statutory income tax rates primarily due to changes in the Company’s valuation allowance, permanent differences and provisions for state and local income taxes. As of March 31, 2020, the Company has a full valuation allowance recorded against deferred tax assets. During the three months ended March 31, 2020, the Company recorded a provision for income taxes of $52, compared to a provision for income taxes of $11 during the three months ended March 31, 2019. The Company files income tax returns in U.S. federal and state jurisdictions. As of March 31, 2020, open tax years in federal and some state jurisdictions date back to 1996 due to the taxing authorities’ ability to adjust operating loss carryforwards. As of December 31, 2019, the Company had federal and unapportioned state net operating loss (“NOL”) carryforwards of $258,834 of which $227,781 will generally 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. Since the Company has no unrecognized tax benefits, they will not have an impact on the condensed consolidated financial statements as a result of the expiration of the applicable statues of limitations within the next twelve months. In addition, 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 IRC Section 382 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 in 2010, the Company determined that aggregate changes in stock ownership have triggered an annual limitation on NOL carryforwards and built-in losses available for utilization, thereby currently limiting annual NOL usage to $14,284 per year. Further limitations may occur, depending on additional future changes in stock ownership. To the extent the Company’s use of NOL carryforwards and associated built-in losses is significantly limited in the future, the Company’s income could be subject to U.S. corporate income tax earlier than it would be if the Company were able to use NOL carryforwards and built-in losses without such limitation, which could result in lower profits and the loss of benefits from these attributes. In February 2013, the Company adopted a Stockholder Rights Plan, which was amended and extended in February 2016 and again in February 2019 (as amended, the “Rights Plan”). The Rights Plan is designed to preserve the Company’s substantial tax assets associated with NOL carryforwards under IRC Section 382. The amendment to the Rights Plan was most recently approved by our stockholders at our 2019 Annual Meeting of Stockholders and has a term of three years. The Rights Plan is intended to act as a deterrent to any person or group, together with its affiliates and associates, 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. As of March 31, 2020, the Company had no unrecognized tax benefits. The Company recognizes interest and penalties related to uncertain tax positions as income tax expense. The Company had no accrued interest and penalties as of March 31, 2020. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2020 | |
SHARE-BASED COMPENSATION | |
SHARE-BASED COMPENSATION | NOTE 11 — SHARE-BASED COMPENSATION The following table summarizes stock option activity during the three months ended March 31, 2020: Weighted Average Options Exercise Price Outstanding as of December 31, 2019 54,362 $ 11.16 Forfeited — $ — Outstanding as of March 31, 2020 54,362 $ 11.16 Exercisable as of March 31, 2020 54,362 $ 11.16 The following table summarizes the Company’s restricted stock unit and performance award activity during the three months ended March 31, 2020: Weighted Average Number of Grant-Date Fair Value Shares Per Share Unvested as of December 31, 2019 1,356,915 $ 2.39 Granted — $ — Vested (121,132) $ 3.41 Forfeited (89,464) $ 5.43 Unvested as of March 31, 2020 1,146,319 $ 2.05 The following table summarizes share-based compensation expense included in the Company’s condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019, as follows: Three Months Ended March 31, 2020 2019 Share-based compensation expense: Cost of sales $ 22 $ 30 Selling, general and administrative 286 225 Net effect of share-based compensation expense on net income $ 308 $ 255 Reduction in earnings per share: Basic earnings per share $ 0.02 $ 0.02 Diluted earnings per share $ 0.02 $ 0.02 |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 3 Months Ended |
Mar. 31, 2020 | |
LEGAL PROCEEDINGS | |
LEGAL PROCEEDINGS | NOTE 12 — 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 of such 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. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2020 | |
RECENT ACCOUNTING PRONOUNCEMENTS | |
RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 13 — 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 condensed consolidated financial statements. |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2020 | |
SEGMENT REPORTING | |
SEGMENT REPORTING | NOTE 14— 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. The Company’s segments and their product and service 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 towers (1,650 tower sections), sufficient to support turbines generating more than 1,100 megawatts of power. The Company has expanded production capabilities and leveraged manufacturing competencies, including welding, lifting capacity and stringent quality practices, into aftermarket and original equipment manufacturer (“OEM”) components utilized in surface and underground mining, construction, material handling, oil and gas (“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, defense, wind energy, steel, material handling and other infrastructure markets. The Company has manufactured loose gearing, gearboxes and systems, and provided heat treatment 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 “Corporate” includes the assets and selling, general and administrative 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, “Basis of Presentation” of these condensed consolidated financial statements. Summary financial information by reportable segment for the three months ended March 31, 2020 and 2019 is as follows: Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Three Months Ended March 31, 2020 Revenues from external customers $ 38,368 6,227 4,039 — — $ 48,634 Operating profit (loss) 3,541 (261) 192 (1,792) — 1,680 Depreciation and amortization 963 512 104 33 — 1,612 Capital expenditures 381 168 120 1 — 670 Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Three Months Ended March 31, 2019 Revenues from external customers $ 28,294 10,027 3,339 — — $ 41,660 Operating (loss) profit (222) 1,387 (285) (1,374) — (494) Depreciation and amortization 1,095 482 122 62 — 1,761 Capital expenditures 201 367 — 9 — 577 Total Assets as of March 31, December 31, Segments: 2020 2019 Heavy Fabrications $ 52,904 $ 41,432 Gearing 46,802 47,022 Industrial Solutions 9,107 8,893 Corporate 239,429 239,629 Eliminations (213,944) (214,110) $ 134,298 $ 122,866 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 15 — COMMITMENTS AND CONTINGENCIES 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. Certain environmental laws may 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. Warranty Liability The Company warrants its products for terms that range from one to five years. In certain contracts, the Company has recourse provisions for items that would enable recovery from third parties for amounts paid to customers under warranty provisions. As of March 31, 2020 and 2019, estimated product warranty liability was $118 and $218, respectively, and is recorded within accrued liabilities in the Company’s condensed consolidated balance sheets. The changes in the carrying amount of the Company’s total product warranty liability for the three months ended March 31, 2020 and 2019 were as follows: For the Three Months Ended March 31, 2020 2019 Balance, beginning of period $ 163 $ 226 Reduction of warranty reserve (25) (19) Other adjustments (20) Balance, end of period $ 118 $ 218 Allowance for Doubtful Accounts Based upon past experience and judgment, the Company establishes an allowance for doubtful accounts with respect to accounts receivable. 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 collectability of its accounts receivable. These factors include individual customer circumstances, history with the Company, the length of the time period during which the account receivable has been past due and other relevant criteria. 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 collectability of its accounts receivable, as noted above, or modifications to its credit standards, collection practices and other related policies may impact the Company’s allowance for doubtful accounts and its financial results. The activity in the accounts receivable allowance liability for the three months ended March 31, 2020 and 2019 consisted of the following: For the Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 127 $ 190 Bad debt expense 55 — Write-offs (19) — Other adjustments (7) (14) Balance at end of period $ 156 $ 176 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. 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/or are dependent on actual losses sustained by the customer. The Company does not believe that this potential exposure will have a material adverse effect on the Company’s consolidated financial position or results of operations. There was no reserve for liquidated damages as of March 31, 2020 or December 31, 2019. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2020 | |
SUBSEQUENT EVENTS. | |
SUBSEQUENT EVENTS | NOTE 16 — SUBSEQUENT EVENTS COVID-19 In March 2020, the World Health Organization characterized the novel coronavirus disease (“COVID-19”) a pandemic, and the President of the United States declared the COVID-19 outbreak a national emergency. The rapid spread of the pandemic and the continuously evolving responses to combat it have had an increasingly negative impact on the global economy. The Company’s operations and those of its suppliers and customers, and the supply chains that support the Company’s and its suppliers’ and customers’ operations have been and continue to be affected by COVID-19. In response to the virus, the Company is following the guidance provided by the U.S. Centers for Disease Control and Prevention to protect the continued safety and welfare of our employees, business partners and their respective communities. In addition, the Company has taken various precautionary actions including, but not limited to, analyzing its supply chain to determine its exposure and identify alternative sourcing, reducing board of director and executive compensation, delaying applicable merit increases and other discretionary spending, restricting employee travel, encouraging employees that have the ability to work from home to do so, implementing social distancing best practices and preparing various contingency plans in the event the Company faces any material adverse impacts from COVID-19. The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States in response to COVID-19. The Paycheck Protection Program (“PPP”) was formed as part of the CARES Act and is administered by the U.S. Small Business Administration (the “SBA”). The PPP allows certain companies to apply for aid through forgivable loans (“PPP Loans”). Under the terms of the PPP, certain amounts of the PPP Loans may be forgiven if they are used for qualifying expenses as described in the CARES Act. The Company applied for these loans through CIBC Bank and received total proceeds of $9,530. The Company intends to use proceeds from the PPP Loans primarily for payroll costs, in accordance with terms and conditions applicable to loans administered by the SBA. The PPP Loans have a 1.00% interest rate and are scheduled to mature starting on April 5, 2022. For more information, refer to the Company’s supplemental risk factor included in the Company’s Current Report on Form 8-K filed April 17, 2020. Name Change In connection with the Company’s rebranding efforts previously announced, following the approval of the Company’s stockholders at the Company’s 2020 Annual Meeting of Stockholders on May 1, 2020, the Company filed a Certificate of Amendment to the Certificate of Incorporation with the Secretary of State of Delaware, changing the name of the Company from “Broadwind Energy, Inc.” to “Broadwind, Inc.” effective on May 4, 2020. In connection with the Company’s name change, the board of directors of the Company amended the Company’s Second Amended and Restated Bylaws to reflect the Company’s new corporate name. |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
REVENUES | |
Schedule of disaggregation of revenue | Three Months Ended March 31, 2020 2019 Heavy Fabrications $ 38,368 $ 28,294 Gearing 6,227 10,027 Industrial Solutions 4,039 3,339 Consolidated $ 48,634 $ 41,660 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
EARNINGS PER SHARE | |
Reconciliation of basic and diluted earnings per share | Three Months Ended March 31, 2020 2019 Basic earnings per share calculation: Net income (loss) $ 954 $ (1,042) Weighted average number of common shares outstanding 16,596,236 15,785,954 Basic net income (loss) per share $ 0.06 $ (0.07) Diluted earnings per share calculation: Net income (loss) $ 954 $ (1,042) Weighted average number of common shares outstanding 16,596,236 15,785,954 Common stock equivalents: Non-vested stock awards (1) 137,038 — Weighted average number of common shares outstanding 16,733,274 15,785,954 Diluted net income (loss) per share $ 0.06 $ (0.07) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
Schedule of the components of inventories from operations | March 31, December 31, 2020 2019 Raw materials $ 24,325 $ 22,759 Work-in-process 11,496 8,366 Finished goods 6,926 2,915 42,747 34,040 Less: Reserve for excess and obsolete inventory (1,993) (2,177) Net inventories $ 40,754 $ 31,863 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
INTANGIBLE ASSETS. | |
Schedule of the cost basis, accumulated amortization and net book value of intangible assets | March 31, 2020 December 31, 2019 Remaining Remaining Weighted Weighted Accumulated Net Average Accumulated Net Average Cost Accumulated Impairment Book Amortization Accumulated Impairment Book Amortization Basis Amortization Charges Value Period Cost Amortization Charges Value Period Intangible assets: Noncompete agreements $ $ (90) $ — $ 80 2.8 $ $ (83) $ — $ 87 Customer relationships 15,979 (6,750) (7,592) 1,637 5.6 15,979 (6,674) (7,592) 1,713 5.8 Trade names 9,099 (6,080) — 3,019 7.5 9,099 (5,980) — 3,119 7.8 Intangible assets $ 25,248 $ (12,920) $ (7,592) $ 4,736 6.3 $ 25,248 $ (12,737) $ (7,592) $ 4,919 6.5 |
Schedule of estimated future amortization expense | As of March 31, 2020, estimated future amortization expense is as follows: 2020 $ 550 2021 733 2022 725 2023 664 2024 661 2025 and thereafter 1,403 Total $ 4,736 |
ACCRUED LIABILITIES (Tables)
ACCRUED LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
ACCRUED LIABILITIES | |
Schedule of accrued liabilities | March 31, December 31, 2020 2019 Accrued payroll and benefits $ 3,256 $ 3,870 Fair value of interest rate swap 216 78 Accrued property taxes 158 — Income taxes payable 69 61 Accrued professional fees 91 136 Accrued warranty liability 118 163 Self-insured workers compensation reserve 112 115 Accrued other 372 488 Total accrued liabilities $ 4,392 $ 4,911 |
DEBT AND CREDIT AGREEMENTS (Tab
DEBT AND CREDIT AGREEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
DEBT AND CREDIT AGREEMENTS | |
Schedule of outstanding debt balances | March 31, December 31, 2020 2019 Line of credit $ 14,000 $ 11,517 Other notes payable 2,363 1,563 Long-term debt 342 342 Less: Current portion (16,350) (12,917) Long-term debt, net of current maturities $ 355 $ 505 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
LEASES | |
Schedule of Quantitative information regarding leases | For the Three Months Ended March 31, 2020 March 31, 2019 Components of lease cost Finance lease cost components: Amortization of finance lease assets $ 129 $ 136 Interest on finance lease liabilities Total finance lease costs 155 165 Operating lease cost components: Operating lease cost 765 786 Short-term lease cost Variable lease cost (1) Sublease income (45) (44) Total operating lease costs 1,047 1,066 Total lease cost $ 1,202 $ 1,231 Supplemental cash flow information related to our operating leases is as follows for the three months ended March 31, 2020 and 2019: Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases Operating cash outflow from operating leases $ 888 $ 875 Weighted-average remaining lease term-finance leases at end of period (in years) Weighted-average remaining lease term-operating leases at end of period (in years) Weighted-average discount rate-finance leases at end of period Weighted-average discount rate-operating leases at end of period (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 March 31, 2020, future minimum lease payments under finance leases and operating leases were as follows: Finance Operating Leases Leases Total 2020 $ 409 $ 2,628 $ 3,037 2021 527 3,387 3,914 2022 202 2,902 3,104 2023 34 2,884 2,918 2024 — 2,906 2,906 2025 and thereafter — 20,119 20,119 Total lease payments 1,172 34,826 35,998 Less—portion representing interest (116) (12,923) (13,039) Present value of lease obligations 1,056 21,903 22,959 Less—current portion of lease obligations (462) (1,579) (2,041) Long-term portion of lease obligations $ 594 $ 20,324 $ 20,918 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
Schedule of the fair values of the Company's financial liabilities | March 31, 2020 Level 1 Level 2 Level 3 Total Liabilities measured on a recurring basis: Interest rate swap $ — $ 216 $ — $ 216 Total liabilities at fair value $ — $ 216 $ — $ 216 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 |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
SHARE-BASED COMPENSATION | |
Schedule of stock option activity | Weighted Average Options Exercise Price Outstanding as of December 31, 2019 54,362 $ 11.16 Forfeited — $ — Outstanding as of March 31, 2020 54,362 $ 11.16 Exercisable as of March 31, 2020 54,362 $ 11.16 |
Schedule of RSU activity | Weighted Average Number of Grant-Date Fair Value Shares Per Share Unvested as of December 31, 2019 1,356,915 $ 2.39 Granted — $ — Vested (121,132) $ 3.41 Forfeited (89,464) $ 5.43 Unvested as of March 31, 2020 1,146,319 $ 2.05 |
Schedule of share-based compensation expense, net of taxes withheld | Three Months Ended March 31, 2020 2019 Share-based compensation expense: Cost of sales $ 22 $ 30 Selling, general and administrative 286 225 Net effect of share-based compensation expense on net income $ 308 $ 255 Reduction in earnings per share: Basic earnings per share $ 0.02 $ 0.02 Diluted earnings per share $ 0.02 $ 0.02 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
SEGMENT REPORTING | |
Schedule of financial information by reportable segment | Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Three Months Ended March 31, 2020 Revenues from external customers $ 38,368 6,227 4,039 — — $ 48,634 Operating profit (loss) 3,541 (261) 192 (1,792) — 1,680 Depreciation and amortization 963 512 104 33 — 1,612 Capital expenditures 381 168 120 1 — 670 Heavy Fabrications Gearing Industrial Solutions Corporate Eliminations Consolidated For the Three Months Ended March 31, 2019 Revenues from external customers $ 28,294 10,027 3,339 — — $ 41,660 Operating (loss) profit (222) 1,387 (285) (1,374) — (494) Depreciation and amortization 1,095 482 122 62 — 1,761 Capital expenditures 201 367 — 9 — 577 Total Assets as of March 31, December 31, Segments: 2020 2019 Heavy Fabrications $ 52,904 $ 41,432 Gearing 46,802 47,022 Industrial Solutions 9,107 8,893 Corporate 239,429 239,629 Eliminations (213,944) (214,110) $ 134,298 $ 122,866 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of changes in the carrying amount of the total product warranty liability | For the Three Months Ended March 31, 2020 2019 Balance, beginning of period $ 163 $ 226 Reduction of warranty reserve (25) (19) Other adjustments (20) Balance, end of period $ 118 $ 218 |
Schedule of the activity in the accounts receivable allowance liability | For the Three Months Ended March 31, 2020 2019 Balance at beginning of period $ 127 $ 190 Bad debt expense 55 — Write-offs (19) — Other adjustments (7) (14) Balance at end of period $ 156 $ 176 |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 31, 2018 | Mar. 31, 2020 | Dec. 31, 2019 |
Description of Business | |||
Revenue as a percentage of sales associated with new wind turbine installations | 74.00% | ||
Liquidity | |||
Total debt and capital lease obligations | $ 17,761 | ||
Obligation to make principal payments on outstanding debt during the next twelve months | 16,812 | ||
Outstanding indebtedness under the Credit Facility | $ 14,000 | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Sales agent commission percentage | 3.00% | ||
ATM common stock available for issuance | $ 9,967 | ||
Minimum | |||
Liquidity | |||
Number of months cash resources adequate to meet Company's liquidity needs | 12 months | ||
Maximum | |||
Liquidity | |||
Proceeds from issuance of stock | $ 10,000 |
REVENUES (Details)
REVENUES (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 48,634 | $ 41,660 |
Heavy Fabrications | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 38,368 | 28,294 |
Gearing | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | 6,227 | 10,027 |
Industrial Solutions | ||
Disaggregation of Revenue [Line Items] | ||
Revenues | $ 4,039 | $ 3,339 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
NET INCOME (LOSS) PER COMMON SHARE—BASIC: | ||
Net income (loss) | $ 954 | $ (1,042) |
Weighted average number of common shares outstanding | 16,596,236 | 15,785,954 |
Basic net income (loss) per share | $ 0.06 | $ (0.07) |
NET INCOME ( LOSS) PER COMMON SHARE—DILUTED: | ||
Net income (loss) | $ 954 | $ (1,042) |
Weighted average number of common shares outstanding | 16,596,236 | 15,785,954 |
Common stock equivalents: | ||
Non-vested stock awards (in shares) | 137,038 | |
Weighted average number of common shares outstanding | 16,733,274 | 15,785,954 |
Diluted net income (loss) per share | $ 0.06 | $ (0.07) |
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) | 683,019 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
INVENTORIES | ||
Raw materials | $ 24,325 | $ 22,759 |
Work-in-process | 11,496 | 8,366 |
Finished goods | 6,926 | 2,915 |
Gross inventories | 42,747 | 34,040 |
Less: Reserve for excess and obsolete inventory | (1,993) | (2,177) |
Net inventories | $ 40,754 | $ 31,863 |
INTANGIBLE ASSETS (Details)
INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
INTANGIBLE ASSETS | ||
Cost Basis | $ 25,248 | $ 25,248 |
Accumulated Amortization | (12,920) | (12,737) |
Accumulated Impairment Charges | (7,592) | (7,592) |
Net Book Value | $ 4,736 | $ 4,919 |
Remaining Weighted Average Amortization Period | 6 years 3 months 18 days | 6 years 6 months |
Estimated future amortization expense | ||
2020 | $ 550 | |
2021 | 733 | |
2022 | 725 | |
2023 | 664 | |
2024 | 661 | |
2025 and thereafter | 1,403 | |
Net Book Value | $ 4,736 | $ 4,919 |
Minimum | ||
INTANGIBLE ASSETS | ||
Remaining Weighted Average Amortization Period | 3 years | |
Maximum | ||
INTANGIBLE ASSETS | ||
Remaining Weighted Average Amortization Period | 8 years | |
Noncompete agreements | ||
INTANGIBLE ASSETS | ||
Cost Basis | $ 170 | 170 |
Accumulated Amortization | (90) | (83) |
Net Book Value | $ 80 | $ 87 |
Remaining Weighted Average Amortization Period | 2 years 9 months 18 days | 3 years 1 month 6 days |
Estimated future amortization expense | ||
Net Book Value | $ 80 | $ 87 |
Customer relationships | ||
INTANGIBLE ASSETS | ||
Cost Basis | 15,979 | 15,979 |
Accumulated Amortization | (6,750) | (6,674) |
Accumulated Impairment Charges | (7,592) | (7,592) |
Net Book Value | $ 1,637 | $ 1,713 |
Remaining Weighted Average Amortization Period | 5 years 7 months 6 days | 5 years 9 months 18 days |
Estimated future amortization expense | ||
Net Book Value | $ 1,637 | $ 1,713 |
Trade names | ||
INTANGIBLE ASSETS | ||
Cost Basis | 9,099 | 9,099 |
Accumulated Amortization | (6,080) | (5,980) |
Net Book Value | $ 3,019 | $ 3,119 |
Remaining Weighted Average Amortization Period | 7 years 6 months | 7 years 9 months 18 days |
Estimated future amortization expense | ||
Net Book Value | $ 3,019 | $ 3,119 |
ACCRUED LIABILITIES (Details)
ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
ACCRUED LIABILITIES | ||||
Accrued payroll and benefits | $ 3,256 | $ 3,870 | ||
Fair value of interest rate swap | 216 | 78 | ||
Accrued property taxes | 158 | |||
Income taxes payable | 69 | 61 | ||
Accrued professional fees | 91 | 136 | ||
Accrued warranty liability | 118 | 163 | $ 218 | $ 226 |
Self-insured workers compensation reserve | 112 | 115 | ||
Accrued other | 372 | 488 | ||
Total accrued liabilities | $ 4,392 | $ 4,911 |
DEBT AND CREDIT AGREEMENTS (Det
DEBT AND CREDIT AGREEMENTS (Details) - USD ($) $ in Thousands | Feb. 25, 2019 | Oct. 26, 2016 | Mar. 31, 2020 | Dec. 31, 2019 | Apr. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2016 |
Credit Facilities | |||||||
Line of credit | $ 14,000 | ||||||
Less: Current portion | (16,350) | $ (12,917) | |||||
Long-term debt, net of current maturities | 355 | 505 | |||||
Future annual principal payments | |||||||
2020 | 16,812 | ||||||
Swap agreement notional amount | $ 6,000 | ||||||
Interest rate on notional amount of debt | 2.13% | ||||||
Capital Expenditure loan | |||||||
Credit Facilities | |||||||
Long-term debt | $ 2,363 | 1,563 | |||||
Future annual principal payments | |||||||
Interest rate (as a percent) | 5.00% | ||||||
Current maturities of long-term debt | $ 2,350 | 1,400 | |||||
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 | 342 | $ 570 | ||||
Future annual principal payments | |||||||
Loan forgiven | 114 | ||||||
Paycheck Protection Program loan | |||||||
Credit Facilities | |||||||
Long-term debt | $ 9,530 | ||||||
Credit facility | |||||||
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 | 16,283 | ||||||
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 | ||||||
Line of credit | |||||||
Credit Facilities | |||||||
Line of credit | $ 14,000 | $ 11,517 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | |
Operating lease liabilities | $ 21,903 | $ 19,508 | |
Right-of-use (“ROU”) asset | $ 19,932 | $ 15,980 | $ 17,613 |
Short-term lease exception term | 1 year | ||
City Centre Main Lease | |||
Operating lease liabilities | $ 4,380 | ||
Right-of-use (“ROU”) asset | $ 4,380 |
LEASES - Quantitative informati
LEASES - Quantitative information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Finance lease cost components: | ||
Amortization of finance lease assets | $ 129 | $ 136 |
Interest on finance lease liabilities | 26 | 29 |
Total finance lease costs | 155 | 165 |
Operating lease cost components: | ||
Operating lease cost | 765 | 786 |
Short-term lease cost | 132 | 146 |
Variable lease cost | 195 | 178 |
Sublease income | (45) | (44) |
Total operating lease costs | 1,047 | 1,066 |
Total lease cost | 1,202 | 1,231 |
Supplemental cash flow information related to our operating leases is as follows for the three months ended March 31, 2020 and 2019: | ||
Operating cash outflow from operating leases | $ 888 | $ 875 |
Weighted-average remaining lease term-finance leases at end of period (in years) | 1 year 2 months 12 days | 1 year 7 months 6 days |
Weighted-average remaining lease term-operating leases at end of period (in years) | 10 years 6 months | 10 years 10 months 24 days |
Weighted-average discount rate-finance leases at end of period | 9.20% | 8.40% |
Weighted-average discount rate-operating leases at end of period | 8.80% | 9.00% |
LEASES - Future minimum lease p
LEASES - Future minimum lease payments under finance leases and operating leases - (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
Finance leases | |||
2020 | $ 409 | ||
2021 | 527 | ||
2022 | 202 | ||
2023 | 34 | ||
Total lease payments | 1,172 | ||
Less - portion representing interest | (116) | ||
Present value of lease obligations | 1,056 | ||
Less - Current portion of lease obligations | (462) | $ (546) | |
Long-term portion of lease obligations | 594 | 673 | |
Operating Leases | |||
2020 | 2,628 | ||
2021 | 3,387 | ||
2022 | 2,902 | ||
2023 | 2,884 | ||
2024 | 2,906 | ||
2025 and thereafter | 20,119 | ||
Total lease payments | 34,826 | ||
Less - portion representing interest | (12,923) | ||
Present value of lease obligations | 21,903 | $ 19,508 | |
Less - current portion of lease obligations | (1,579) | (1,326) | |
Non-current operating lease liabilities | 20,324 | $ 16,591 | |
Total | |||
2020 | 3,037 | ||
2021 | 3,914 | ||
2022 | 3,104 | ||
2023 | 2,918 | ||
2024 | 2,906 | ||
2025 and thereafter | 20,119 | ||
Total lease payments | 35,998 | ||
Less - portion representing interest | (13,039) | ||
Present value of lease obligations | 22,959 | ||
Less - current portion of lease obligations | (2,041) | ||
Long-term portion of lease obligations | $ 20,918 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
FAIR VALUE MEASUREMENTS | ||
Interest rate swap | $ 216 | $ 78 |
Recurring | ||
FAIR VALUE MEASUREMENTS | ||
Total liabilities at fair value | 216 | 78 |
Recurring | Interest rate swap | ||
FAIR VALUE MEASUREMENTS | ||
Interest rate swap | 216 | 78 |
Recurring | Level 2 | ||
FAIR VALUE MEASUREMENTS | ||
Total liabilities at fair value | 216 | 78 |
Recurring | Level 2 | Interest rate swap | ||
FAIR VALUE MEASUREMENTS | ||
Interest rate swap | $ 216 | $ 78 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
INCOME TAXES | |||
Provision for income taxes | $ 52 | $ 11 | |
Operating Loss Carryforwards | $ 258,834 | ||
Annual NOL usage limit | 14,284 | ||
Tax year 2026 | |||
INCOME TAXES | |||
Operating Loss Carryforwards | $ 227,781 |
INCOME TAXES (Details)_2
INCOME TAXES (Details) $ / shares in Units, $ in Thousands | Feb. 13, 2013$ / sharesshares | Feb. 13, 2013item$ / sharesshares | Feb. 12, 2013 | Mar. 31, 2020USD ($) |
Rights Plan | ||||
Extended term of Rights plan | 3 years | |||
Unrecognized tax benefits | $ 0 | |||
Accrued interest or penalties related to uncertain tax positions recognized | $ 0 | |||
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 | 0.001 | ||
Exercise price (in dollars per right) | $ / shares | $ 4.25 | $ 4.25 | ||
Series A Junior Participating Preferred Stock | Minimum | ||||
Rights Plan | ||||
Beneficial ownership percentage of any person or group, together with its affiliates and associates | 4.90% | |||
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% |
SHARE-BASED COMPENSATION (Detai
SHARE-BASED COMPENSATION (Details) - Stock Options | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Summary of the stock option activity | |
Outstanding at the beginning of the period (in shares) | shares | 54,362 |
Forfeited (in shares) | shares | 0 |
Outstanding at the end of the period (in shares) | shares | 0 |
Exercisable (in shares) | shares | 54,362 |
Weighted Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 11.16 |
Forfeited (in dollars per share) | $ / shares | 0 |
Outstanding at the end of the period (in dollars per share) | $ / shares | 0 |
Exercisable (in dollars per share) | $ / shares | $ 11.16 |
SHARE-BASED COMPENSATION - Stoc
SHARE-BASED COMPENSATION - Stock Option Activity (Details) - RSU | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Summary of the restricted stock unit activity | |
Unvested at the beginning of the period (in shares) | shares | 1,356,915 |
Vested (in shares) | shares | (121,132) |
Forfeited (in shares) | shares | (89,464) |
Unvested at the end of the period (in shares) | shares | 1,146,319 |
Weighted Average Grant-Date Fair Value Per RSU | |
Unvested at the beginning of the period (in dollars per share) | $ / shares | $ 2.39 |
Vested (in dollars per share) | $ / shares | 3.41 |
Forfeited (in dollars per share) | $ / shares | 5.43 |
Unvested at the end of the period (in dollars per share) | $ / shares | $ 2.05 |
SHARE-BASED COMPENSATION - Shar
SHARE-BASED COMPENSATION - Shares-based Compensation Expense (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Summary of share-based compensation expense | ||
Net effect of share-based compensation expense on net income | $ 308 | $ 255 |
Reduction in earnings per share: | ||
Basic earnings per share | $ 0.02 | $ 0.02 |
Diluted earnings per share | $ 0.02 | $ 0.02 |
Cost of sales | ||
Summary of share-based compensation expense | ||
Share-based compensation expense | $ 22 | $ 30 |
Selling, general and administrative | ||
Summary of share-based compensation expense | ||
Share-based compensation expense | $ 286 | $ 225 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020USD ($)facilityitemMW | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) | |
SEGMENT REPORTING | |||
Revenues from external customers | $ 41,660 | ||
Revenues | $ 48,634 | 41,660 | |
Operating profit (loss) | 1,680 | (494) | |
Depreciation and amortization | 1,612 | 1,761 | |
Capital expenditures | 670 | 577 | |
Total Assets | $ 134,298 | $ 122,866 | |
Towers and Heavy Fabrications | |||
SEGMENT REPORTING | |||
Number of facilities | facility | 2 | ||
Number of tower sections | item | 1,650 | ||
Revenues from external customers | 28,294 | ||
Revenues | $ 38,368 | ||
Operating profit (loss) | 3,541 | (222) | |
Depreciation and amortization | 963 | 1,095 | |
Capital expenditures | 381 | 201 | |
Total Assets | $ 52,904 | 41,432 | |
Towers and Heavy Fabrications | Maximum | |||
SEGMENT REPORTING | |||
Annual tower production capacity (in towers) | item | 550 | ||
Towers and Heavy Fabrications | Minimum | |||
SEGMENT REPORTING | |||
Power generating capacity of turbines that towers produced annually can support (in megawatts) | MW | 1,100 | ||
Gearing | |||
SEGMENT REPORTING | |||
Revenues from external customers | 10,027 | ||
Revenues | $ 6,227 | 10,027 | |
Operating profit (loss) | (261) | 1,387 | |
Depreciation and amortization | 512 | 482 | |
Capital expenditures | 168 | 367 | |
Total Assets | 46,802 | 47,022 | |
Industrial Solutions | |||
SEGMENT REPORTING | |||
Revenues from external customers | 3,339 | ||
Revenues | 4,039 | 3,339 | |
Operating profit (loss) | 192 | (285) | |
Depreciation and amortization | 104 | 122 | |
Capital expenditures | 120 | ||
Total Assets | 9,107 | 8,893 | |
Corporate | |||
SEGMENT REPORTING | |||
Operating profit (loss) | (1,792) | (1,374) | |
Depreciation and amortization | 33 | 62 | |
Capital expenditures | 1 | $ 9 | |
Total Assets | 239,429 | 239,629 | |
Eliminations | |||
SEGMENT REPORTING | |||
Total Assets | $ (213,944) | $ (214,110) |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Changes in the carrying amount of the total product warranty liability | |||
Balance, beginning of period | $ 163 | $ 226 | |
Reduction of warranty reserve | (25) | (19) | |
Other adjustments | (20) | 11 | |
Balance, end of period | 118 | 218 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Balance at beginning of period | 127 | 190 | |
Bad debt expense | 55 | ||
Write-offs | (19) | ||
Other adjustments | (7) | (14) | |
Balance at end of period | 156 | $ 176 | |
Liquidated Damages | |||
Reserve for liquidated damages | $ 0 | $ 0 | |
Minimum | |||
Warranty Liability | |||
Term of warranty | 1 year | ||
Maximum | |||
Warranty Liability | |||
Term of warranty | 5 years |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - Paycheck Protection Program loan $ in Thousands | Apr. 30, 2020USD ($) |
Long-term debt | $ 9,530 |
Subsequent event | |
Long-term debt | $ 9,530 |
Debt Instrument, Interest Rate, Stated Percentage | 1.00% |