Houston Wire & Cable (HWCC) 10-Q 8 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 01, 2016
Document And Entity Information
Entity Registrant Name	Houston Wire & Cable CO
Entity Central Index Key	1,356,949
Document Type	10-Q
Trading Symbol	HWCC
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		16,380,704
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,016

Consolidated Balance Sheets (un

Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Accounts receivable, net	$ 42,929	$ 46,250
Inventories, net	63,563	75,777
Income taxes	1,577	932
Prepaids	1,095	648
Total current assets	109,164	123,607
Property and equipment, net	10,884	10,899
Intangible assets, net	4,734	5,984
Goodwill	12,504	14,866
Deferred income taxes	4,090	3,338
Other assets	415	419
Total assets	141,791	159,113
Current liabilities:
Book overdraft	1,102	3,701
Trade accounts payable	8,488	6,380
Accrued and other current liabilities	11,053	9,568
Total current liabilities	20,643	19,649
Debt	28,619	39,188
Other long term obligations	516	275
Total liabilities	49,778	59,112
Stockholders' equity:
Preferred stock, $0.001 par value; 5,000,000 shares authorized, none issued and outstanding
Common stock, $0.001 par value; 100,000,000 shares authorized: 20,988,952 shares issued: 16,402,204 and 16,712,626 outstanding at September 30, 2016 and December 31, 2015, respectively	21	21
Additional paid-in-capital	55,007	54,621
Retained earnings	99,374	106,048
Treasury stock	(62,389)	(60,689)
Total stockholders' equity	92,013	100,001
Total liabilities and stockholders' equity	$ 141,791	$ 159,113

Consolidated Balance Sheets (u3

Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized	5,000,000	5,000,000
Preferred stock, issued	0	0
Preferred stock, outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized	100,000,000	100,000,000
Common stock, issued	20,988,952	20,988,952
Common stock, outstanding	16,402,204	16,712,626

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Sales	$ 65,222	$ 78,260	$ 192,387	$ 237,819
Cost of sales	53,177	62,129	154,513	187,029
Gross profit	12,045	16,131	37,874	50,790
Operating expenses:
Salaries and commissions	7,148	7,311	20,895	21,717
Other operating expenses	5,969	6,300	17,302	18,629
Depreciation and amortization	732	737	2,198	2,175
Impairment charge			2,384	2,994
Total operating expenses	13,849	14,348	42,779	45,515
Operating income (loss)	(1,804)	1,783	(4,905)	5,275
Interest expense	129	237	453	719
Income (loss) before income taxes	(1,933)	1,546	(5,358)	4,556
Income tax expense (benefit)	(494)	870	(1,178)	2,313
Net income (loss)	$ (1,439)	$ 676	$ (4,180)	$ 2,243
Earnings (loss) per share:
Basic (in dollars per share)	$ (0.09)	$ 0.04	$ (0.26)	$ 0.13
Diluted (in dollars per share)	$ (0.09)	$ 0.04	$ (0.26)	$ 0.13
Weighted average common shares outstanding:
Basic (in shares)	16,302,870	17,017,334	16,388,892	17,137,730
Diluted (in shares)	16,302,870	17,072,128	16,388,892	17,190,664
Dividends declared per share (in dollars per share)	$ 0.03	$ 0.12	$ 0.15	$ 0.36

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating activities
Net income (loss)	$ (4,180)	$ 2,243
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Impairment charge	2,384	2,994
Depreciation and amortization	2,198	2,175
Amortization of unearned stock compensation	626	668
Provision for inventory obsolescence	355	351
Deferred income taxes	(752)	(727)
Other non-cash items	(11)	70
Changes in operating assets and liabilities:
Accounts receivable	3,360	10,370
Inventories	11,859	11,667
Book overdraft	(2,599)	(808)
Trade accounts payable	2,108	1,264
Accrued and other current liabilities	1,486	(278)
Income taxes	(645)	(909)
Other operating activities	(230)	(288)
Net cash provided by operating activities	15,959	28,792
Investing activities
Expenditures for property and equipment	(955)	(2,946)
Net cash used in investing activities	(955)	(2,946)
Financing activities
Borrowings on revolver	195,914	233,187
Payments on revolver	(206,483)	(248,208)
Payment of dividends	(2,477)	(6,166)
Purchase of treasury stock	(1,958)	(4,659)
Net cash used in financing activities	(15,004)	(25,846)
Net change in cash
Cash at beginning of period
Cash at end of period

Basis of Presentation and Princ

Basis of Presentation and Principles of Consolidation	9 Months Ended
	Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Principles of Consolidation	1. Basis of Presentation and Principles of Consolidation Houston Wire & Cable Company (the “Company”), through its wholly owned subsidiaries, provides wire and cable, hardware and related services to the U.S. market through eighteen locations in thirteen states throughout the United States as of September 30, 2016. The Company has no other business activity. The consolidated financial statements as of September 30, 2016 and for the nine months ended September 30, 2016 and 2015 have been prepared following accounting principles generally accepted in the United States (“GAAP”) for interim financial information and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation of the results of these interim periods have been included. The results of operations for the interim periods are not necessarily indicative of the results that may be expected for the full year. All significant inter-company balances and transactions have been eliminated. The Company has evaluated subsequent events through the time these financial statements in this Form 10-Q were filed with the Securities and Exchange Commission (the “SEC”). The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. The most significant estimates are those relating to the inventory obsolescence reserve, the reserve for returns and allowances, vendor rebates and asset impairments. Actual results could differ materially from the estimates and assumptions used for the preparation of the financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 filed with the SEC. Recent Accounting Pronouncements The Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) is the sole source of authoritative GAAP other than SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standard Update (“ASU”) to communicate changes to the codification. The Company considers the applicability and impact of all ASUs. The following recently issued ASUs are relevant to the Company. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The amendments in this ASU address eight cash flow issues with the intention of reducing current diversity in practice among business entities. The Company will evaluate the eight issues in the amendment and determine if any changes are necessary for compliance. ASU 2016-15 is effective for annual and interim periods beginning after December 15, 2017; early adoption is permitted and should be applied retrospectively where practical. The Company will determine the date of adoption, once the Company has evaluated the impact of this ASU. In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” The new guidance addresses several aspects of the accounting for share-based payment award transactions, including: (a) the recognition of the income tax effects of awards in the income statement when the awards vest, forfeit, or are settled, thus eliminating additional paid-in-capital pools, (b) classification of awards as either equity or liabilities, and (c) classification on the statement of cash flows. This update is effective for public companies for fiscal years beginning after December 15, 2016 with early adoption permitted. The Company is currently evaluating the elections the Company may make as well as the effects the adoption of this guidance may have on the Company's consolidated financial statements and will adopt this ASU in the first quarter of 2017. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Under the new guidance, a lessee will be required to recognize assets and liabilities for leases greater than 1 year, regardless of whether they were previously accounted for as capital or operating leases. This update is effective for public companies for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company is currently evaluating the impacts of adopting as well as the timing of when it will adopt this ASU. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740) — Balance Sheet Classification of Deferred Taxes.” ASU No. 2015-17 eliminates the requirement to classify deferred tax assets and liabilities as current or long-term based on how the related assets or liabilities are classified. All deferred taxes are now required to be classified as long-term including any associated valuation allowances. This guidance is effective for public companies for fiscal years beginning after December 15, 2016 with early adoption permitted on either a prospective or retrospective basis. The Company adopted this guidance in the third quarter and has applied it retrospectively. It did not have a material impact on the consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330),” which changes guidance for subsequent measurement of inventory within the scope of the update from the lower of cost or market to the lower of cost and net realizable value. This update is effective for annual and interim periods beginning after December 15, 2016 and early adoption is permitted. The Company does not believe there will be any material impact upon the adoption of this guidance on the Company's consolidated financial statements and will adopt this ASU in the first quarter of 2017. In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30).” The amendments in this ASU require debt issuance costs to be presented on the balance sheet as a direct reduction from the carrying amount of the related debt liability. However, the guidance in this ASU did not address the presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. As a result, in August 2015 the FASB issued ASU No. 2015-15 “Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Agreements,” to clarify that, with respect to a line-of-credit agreement, the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement. The Company adopted this guidance in the first quarter and will continue to treat debt issuance costs associated with its revolving credit facility as a deferred asset and amortize the deferred asset over the term of the credit agreement. Therefore, the adoption did not have any impact on the Company’s financial position or results of operations. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition,” and most industry-specific guidance. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. The amendments in the ASU must be applied using one of two retrospective methods and are effective for annual and interim periods beginning after December 15, 2017. Early adoption for annual and interim periods beginning after December 31, 2016 is permitted. The Company is still evaluating the impact of this ASU on its financial position and results of operations, timing of adoption, and which implementation method the Company will use.

Earnings (loss) per Share

Earnings (loss) per Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Earnings (loss) per Share	2. Earnings (loss) per Share Basic earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share include the dilutive effects of stock options and unvested restricted stock awards and units. The following reconciles the denominator used in the calculation of diluted earnings (loss) per share: Three Months Ended Six Months Ended September 30, September 30, 2016 2015 2016 2015 Denominator: Weighted average common shares for basic earnings (loss) per share 16,302,870 17,017,334 16,388,892 17,137,730 Effect of dilutive securities — 54,794 — 52,934 Weighted average common shares for diluted earnings (loss) per share 16,302,870 17,072,128 16,388,892 17,190,664 The weighted average common shares for diluted earnings (loss) per share exclude stock options and unvested restricted stock awards and units to purchase 736,968 and 632,736 shares for the three months ended September 30, 2016 and 2015, respectively, and 772,012 and 606,405 shares for the nine months ended September 30, 2016 and 2015. These securities have been excluded from the calculation, as including them would have an anti-dilutive effect on earnings (loss) per share for the respective periods.

Impairment of Goodwill and Inta

Impairment of Goodwill and Intangibles	9 Months Ended
	Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Impairment of Goodwill and Intangibles	3. Impairment of Goodwill and Intangibles During the second quarter of 2016 and prior to the annual impairment test of goodwill in October, the Company concluded that impairment indicators existed at the Houston Wire & Cable (HWC) reporting unit, due to a decline in the overall financial performance, decrease in the market capitalization and overall market demand. In the second quarter, the Company also concluded that there were impairment indicators for certain of the Company’s tradenames related to the Southwest Wire Rope (Southwest) and Southern Wire reporting units. The Company performed step one of the impairment test and concluded that the fair value of the HWC reporting unit was less than its carrying value. Therefore, the Company performed step two of the impairment analysis. The step one test also indicated that one of the tradenames at Southern Wire was impaired, and the Company recorded a non-cash charge of less than $0.1 million against the tradenames during the quarter ended June 30, 2016. Step two of the impairment analysis measures the impairment charge by allocating the HWC reporting unit’s fair value to all of the assets and liabilities of the reporting unit in a hypothetical analysis that calculates implied fair value of goodwill in the same manner as if the reporting unit was being acquired in a business combination and recording the deferred tax impact. Any excess of the carrying value of the reporting unit’s goodwill over the implied fair value of the reporting unit’s goodwill is recorded as an impairment loss. The fair value of the HWC reporting unit was estimated using a discounted cash flow model (income approach) and a guideline public company method, giving 50% weight to each. The material assumptions used included a weighted average cost of capital of 11.0% and a long-term growth rate of 3-7% for the income approach and an adjusted invested capital multiple of 0.2 times revenue and a control premium of 10.0% for the guideline public company method. The carrying value of the HWC reporting unit’s goodwill was $2.4 million and its implied fair value resulting from step two of the impairment test was zero. As a result, the Company recorded a non-cash goodwill impairment charge of $2.4 million during the quarter ended June 30, 2016. The fair value for goodwill and tradenames (indefinite-lived intangible assets) were both determined using a Level 3 measurement approach. The Level 3 value of all of the Company’s tradenames at June 30, 2016 was $4.5 million. During the second quarter of 2015 and prior to the annual impairment test of goodwill in October, the Company concluded that impairment indicators existed at the Southwest Wire Rope (Southwest) reporting unit, due to a decline in the overall financial performance and overall market demand. Impairment indicators also existed for certain of the Company’s tradenames related to the Southwest and Southern Wire reporting units. After performing the necessary analysis the Company recorded, during the quarter ended June 30, 2015, a non-cash charge of $0.4 million against the tradenames and a non-cash goodwill impairment charge of $2.6 million.

Debt

Debt	9 Months Ended
	Sep. 30, 2016
Debt Disclosure [Abstract]
Debt	4. Debt On October 1, 2015, HWC Wire & Cable Company, as borrower, entered into the Fourth Amended and Restated Loan and Security Agreement (the “2015 Loan Agreement”), with Bank of America, N.A., as agent and lender, and the Company, as guarantor, executed a Third Amended and Restated Guaranty of the borrower’s obligations thereunder. The 2015 Loan Agreement provides a $100 million revolving credit facility, bears interest at the agent’s base rate, with a London Interbank Offered Rate (“LIBOR”) rate option, and expires on September 30, 2020. Under certain circumstances, the Company may request an increase in the commitment by an additional $50 million. The 2015 Loan Agreement is secured by substantially all of the property of the Company, other than real estate. Availability under the 2015 Loan Agreement is limited to a borrowing base equal to 85% of the value of eligible accounts receivable, plus the lesser of 70% of the value of eligible inventory or 90% of the net orderly liquidation value percentage of the value of eligible inventory, in each case less certain reserves. The 2015 Loan Agreement was amended on October 3, 2016 in connection with the Vertex acquisition. See Note 8. Portions of the loan may be converted to LIBOR loans in minimum amounts of $1.0 million and integral multiples of $0.1 million. LIBOR loans bear interest at the British Bankers Association LIBOR Rate plus 100 to 150 basis points based on availability, and loans not converted to LIBOR loans bear interest at a fluctuating rate equal to the greatest of the agent’s prime rate, the federal funds rate plus 50 basis points, or 30-day LIBOR plus 150 basis points. The unused commitment fee is 25 basis points. The 2015 Loan Agreement includes, among other things, covenants that require the Company to maintain a specified minimum fixed charge coverage ratio, unless certain availability levels exist. Additionally, the 2015 Loan Agreement allows for the unlimited payment of dividends and repurchases of stock, subject to the absence of events of default and maintenance of a fixed charge coverage ratio and minimum level of availability. The 2015 Loan Agreement contains certain provisions that may cause the debt to be classified as a current liability, in accordance with GAAP, if availability falls below certain thresholds, even though the ultimate maturity date under the loan agreement remains as September 30, 2020. At September 30, 2016, the Company was in compliance with the availability-based covenants governing its indebtedness. The carrying amount of long term debt approximates fair value as it bears interest at variable rates. The fair value is a Level 2 measurement as defined in ASC Topic 820, “Fair Value Measurement.”

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Stockholders' Equity	5. Stockholders’ Equity During each of the first and second quarters of 2016, the Board of Directors approved a quarterly dividend of $0.06 per share payable to stockholders and during the third quarter of 2016, the Board of Directors approved a quarterly dividend of $0.03 per share payable to stockholders. Dividends paid were $2.5 million and $6.2 million during the nine months ended September 30, 2016 and 2015, respectively.

Stock Based Compensation

Stock Based Compensation	9 Months Ended
	Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock Based Compensation	6. Stock Based Compensation Stock Option Awards There were no stock option awards granted during the first nine months of 2016 or 2015. Restricted Stock Awards and Restricted Stock Units Following the Annual Meeting of Stockholders on May 3, 2016, the Company awarded restricted stock units with a value of $50,000 to each non-employee director who was elected or re-elected, for an aggregate of 35,515 restricted stock units. Each award of restricted stock units vests at the date of the 2017 Annual Meeting of Stockholders. Each non-employee director is entitled to receive a number of shares of the Company's common stock equal to the number of vested restricted stock units, together with dividend equivalents from the date of grant, at such time as the director’s service on the board terminates for any reason. On August 4, 2016, the Company granted 7,000 shares of restricted stock to a new member of the management team. These shares vest in one third increments, on the third, fourth and fifth anniversaries of the date of grant as long as the recipient is then employed by the Company. Any dividends declared will be accrued and paid to the recipient if and when the related shares vest. Total stock-based compensation cost was $0.2 million for each of the three months ended September 30, 2016 and 2015 and $0.6 million and $0.7 million for the nine months ended September 30, 2016 and 2015, respectively, and is included in salaries and commissions.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	7. Commitments and Contingencies As part of the acquisition of Southwest Wire and Southern Wire in 2010, the Company assumed the liability for the post-remediation monitoring of the water quality at one of the acquired facilities in Louisiana. The expected liability of $0.1 million at September 30, 2016 relates to the cost of the monitoring, which the Company estimates will be incurred over approximately the next two years, and also the cost to plug the wells. Remediation work was completed prior to the acquisition in accordance with the requirements of the Louisiana Department of Environmental Quality. The Company, along with many other defendants, has been named in a number of lawsuits in the state courts of Minnesota, North Dakota, and South Dakota alleging that certain wire and cable which may have contained asbestos caused injury to the plaintiffs who were exposed to this wire and cable. These lawsuits are individual personal injury suits that seek unspecified amounts of money damages as the sole remedy. It is not clear whether the alleged injuries occurred as a result of the wire and cable in question or whether the Company, in fact, distributed the wire and cable alleged to have caused any injuries. The Company maintains general liability insurance that, to date, has covered the defense of and all costs associated with these claims. In addition, the Company did not manufacture any of the wire and cable at issue, and the Company would rely on any warranties from the manufacturers of such cable if it were determined that any of the wire or cable that the Company distributed contained asbestos which caused injury to any of these plaintiffs. In connection with ALLTEL’s sale of the Company in 1997, ALLTEL provided indemnities with respect to costs and damages associated with these claims that the Company believes it could enforce if its insurance coverage proves inadequate. There are no legal proceedings pending against or involving the Company that, in management’s opinion, based on the current known facts and circumstances, are expected to have a material adverse effect on the Company’s consolidated financial position, cash flows, or results from operations.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2016
Subsequent Events [Abstract]
Subsequent Events	8. Subsequent Events On October 3, 2016, HWC Wire & Cable Company (the “Buyer”), a subsidiary of the Company acquired all of the issued and outstanding shares of common stock of Vertex Corporate Holdings, Inc. and its subsidiaries (“Vertex”) from DXP Enterprises, Inc. (“DXP”) pursuant to a Stock Purchase Agreement, dated as of October 3, 2016 between DXP and the Buyer (the “Purchase Agreement”). The Company has guaranteed the obligations of the Buyer under the Purchase Agreement. Vertex is engaged in the wholesale distribution of industrial fasteners. The purchase price for the acquisition consisted of $32.3 million in cash and is subject to a post-closing adjustment based on the net working capital of Vertex as of the closing date. The Buyer financed the payment of the purchase price through borrowings under an amendment to the 2015 Loan Agreement. In addition, the Company granted 21,000 shares of restricted stock to four members of the Vertex management team. The shares will vest and declared dividends will be accrued, subject to their employment with the Company. Also on October 3, 2016, in connection with the Vertex acquisition, the Buyer, the Company, Vertex, and Bank of America, N.A., as agent and lender, entered into a First Amendment to the Fourth Amended and Restated Loan and Security Agreement (the “Loan Agreement Amendment”) amending the 2015 Loan Agreement. The Loan Agreement Amendment adds Vertex as borrower (and lien grantor) and provides the terms for inclusion of Vertex’s eligible accounts receivable and eligible inventory in the borrowing base for the 2015 Loan Agreement. The 2015 Loan Agreement was expanded to include incremental availability on eligible accounts receivable and inventory up to $5 million, which will be amortized quarterly, effective April 1, 2017, over two and a half years. Total borrowing capacity will remain at $100 million.

Basis of Presentation and Pri14

Basis of Presentation and Principles of Consolidation (Policies)	9 Months Ended
	Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Recent Accounting Pronouncements	Recent Accounting Pronouncements The Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) is the sole source of authoritative GAAP other than SEC issued rules and regulations that apply only to SEC registrants. The FASB issues an Accounting Standard Update (“ASU”) to communicate changes to the codification. The Company considers the applicability and impact of all ASUs. The following recently issued ASUs are relevant to the Company. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments.” The amendments in this ASU address eight cash flow issues with the intention of reducing current diversity in practice among business entities. The Company will evaluate the eight issues in the amendment and determine if any changes are necessary for compliance. ASU 2016-15 is effective for annual and interim periods beginning after December 15, 2017; early adoption is permitted and should be applied retrospectively where practical. The Company will determine the date of adoption, once the Company has evaluated the impact of this ASU. In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting.” The new guidance addresses several aspects of the accounting for share-based payment award transactions, including: (a) the recognition of the income tax effects of awards in the income statement when the awards vest, forfeit, or are settled, thus eliminating additional paid-in-capital pools, (b) classification of awards as either equity or liabilities, and (c) classification on the statement of cash flows. This update is effective for public companies for fiscal years beginning after December 15, 2016 with early adoption permitted. The Company is currently evaluating the elections the Company may make as well as the effects the adoption of this guidance may have on the Company's consolidated financial statements and will adopt this ASU in the first quarter of 2017. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” Under the new guidance, a lessee will be required to recognize assets and liabilities for leases greater than 1 year, regardless of whether they were previously accounted for as capital or operating leases. This update is effective for public companies for fiscal years beginning after December 15, 2018 with early adoption permitted. The Company is currently evaluating the impacts of adopting as well as the timing of when it will adopt this ASU. In November 2015, the FASB issued ASU No. 2015-17, “Income Taxes (Topic 740) — Balance Sheet Classification of Deferred Taxes.” ASU No. 2015-17 eliminates the requirement to classify deferred tax assets and liabilities as current or long-term based on how the related assets or liabilities are classified. All deferred taxes are now required to be classified as long-term including any associated valuation allowances. This guidance is effective for public companies for fiscal years beginning after December 15, 2016 with early adoption permitted on either a prospective or retrospective basis. The Company adopted this guidance in the third quarter and has applied it retrospectively. It did not have a material impact on the consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330),” which changes guidance for subsequent measurement of inventory within the scope of the update from the lower of cost or market to the lower of cost and net realizable value. This update is effective for annual and interim periods beginning after December 15, 2016 and early adoption is permitted. The Company does not believe there will be any material impact upon the adoption of this guidance on the Company's consolidated financial statements and will adopt this ASU in the first quarter of 2017. In April 2015, the FASB issued ASU No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30).” The amendments in this ASU require debt issuance costs to be presented on the balance sheet as a direct reduction from the carrying amount of the related debt liability. However, the guidance in this ASU did not address the presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. As a result, in August 2015 the FASB issued ASU No. 2015-15 “Interest—Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Agreements,” to clarify that, with respect to a line-of-credit agreement, the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement. The Company adopted this guidance in the first quarter and will continue to treat debt issuance costs associated with its revolving credit facility as a deferred asset and amortize the deferred asset over the term of the credit agreement. Therefore, the adoption did not have any impact on the Company’s financial position or results of operations. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in ASC Topic 605, “Revenue Recognition,” and most industry-specific guidance. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments, and assets recognized from costs incurred to obtain or fulfill a contract. The amendments in the ASU must be applied using one of two retrospective methods and are effective for annual and interim periods beginning after December 15, 2017. Early adoption for annual and interim periods beginning after December 31, 2016 is permitted. The Company is still evaluating the impact of this ASU on its financial position and results of operations, timing of adoption, and which implementation method the Company will use.

Earnings (loss) per Share (Tabl

Earnings (loss) per Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Schedule of diluted earnings (loss) per share	The following reconciles the denominator used in the calculation of diluted earnings (loss) per share: Three Months Ended Six Months Ended September 30, September 30, 2016 2015 2016 2015 Denominator: Weighted average common shares for basic earnings (loss) per share 16,302,870 17,017,334 16,388,892 17,137,730 Effect of dilutive securities — 54,794 — 52,934 Weighted average common shares for diluted earnings (loss) per share 16,302,870 17,072,128 16,388,892 17,190,664

Earnings (loss) per Share (Deta

Earnings (loss) per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Denominator:
Weighted average common shares for basic earnings (loss) per share	16,302,870	17,017,334	16,388,892	17,137,730
Effect of dilutive securities		54,794		52,934
Weighted average common shares for diluted earnings (loss) per share	16,302,870	17,072,128	16,388,892	17,190,664

Earnings (loss) per Share (De17

Earnings (loss) per Share (Details Narrative) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Earnings Per Share [Abstract]
Weighted average number of common shares excluded from computation of earnings per share	736,968	632,736	772,012	606,405

Impairment of Goodwill and In18

Impairment of Goodwill and Intangibles (Details Narrative) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016	Jun. 30, 2016	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Goodwill, impairment loss					$ 2,384	$ 2,994
Goodwill carrying value	$ 12,504				$ 12,504		$ 14,866
Houston Wire & Cable (HWC) Reporting Unit [Member]
Goodwill, impairment loss		$ 2,400
Goodwill fair value		0
Goodwill carrying value		2,400
Description of valuation assumption					The material assumptions used included a weighted average cost of capital of 11.0% and a long-term growth rate of 3-7% for the income approach and adjusted invested capital multiple of 0.2 times revenue and a control premium of 10.0% for the guideline public company method.
Houston Wire & Cable (HWC) Reporting Unit [Member] | Income Approach [Member]
Weighted average cost of capital					11.00%
Houston Wire & Cable (HWC) Reporting Unit [Member] | Income Approach [Member] | Minimum [Member]
Long-term growth rate					3.00%
Houston Wire & Cable (HWC) Reporting Unit [Member] | Income Approach [Member] | Maximum [Member]
Long-term growth rate					7.00%
Southern Reporting Unit [Member]
Goodwill, impairment loss				$ 2,600
Southern Reporting Unit [Member] | Tradenames [Member]
Impairment of intangible assets (excluding goodwill)		100		$ 400
Southern Reporting Unit [Member] | Tradenames [Member] | Level 3 Measurement Approach [Member]
Fair value for tradename		$ 4,500

Debt (Details Narrative)

Debt (Details Narrative) - Fourth Amended and Restated Loan and Security Agreement (the 2015 Loan Agreement) [Member] - Revolving Credit Facility [Member] - USD ($) $ in Thousands	Oct. 01, 2015	Sep. 30, 2016
Maximum amount outstanding	$ 100,000
Expiration date	Sep. 30, 2020
Additional commitment amount	$ 50,000
Description of collateral		Secured by substantially all of the property of the Company, other than real estate.
Percentage of the value of eligible accounts receivable	85.00%
Percentage of the value of eligible inventory	70.00%
Percentage of the value of net orderly liquidation	90.00%
Description of loan converted		Portions of the loan may be converted to LIBOR loans in minimum amounts of $1.0 million and integral multiples of $0.1 million.
Description of interest rate		LIBOR loans bear interest at the British Bankers Association LIBOR Rate plus 100 to 150 basis points based on availability, and loans not converted to LIBOR loans bear interest at a fluctuating rate equal to the greatest of the agent’s prime rate, the federal funds rate plus 50 basis points, or 30-day LIBOR plus 150 basis points.
Percentage of unused capacity commitment fee		0.25%

Stockholders' Equity (Details N

Stockholders' Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Equity [Abstract]
Common stock dividends declared (in dollars per share)	$ 0.03	$ 0.06	$ 0.06	$ 0.12	$ 0.15	$ 0.36
Dividend paid in cash					$ 2,477	$ 6,166

Stock Based Compensation (Detai

Stock Based Compensation (Details Narrative) - USD ($) $ in Thousands	Aug. 04, 2016	May 03, 2016	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Allocated share based compensation included in salaries and commissions			$ 200	$ 200	$ 626	$ 668
Restricted Stock Units [Member]
Number of restricted stock units awarded	7,000
Non-Employee Director [Member] | Restricted Stock Units [Member]
Value of restricted stock units awarded		$ 50
Number of restricted stock units awarded		35,515

Commitments and Contingencies (

Commitments and Contingencies (Details Narrative) - Southwest Wire Rope Reporting Unit [Member] $ in Thousands	9 Months Ended
	Sep. 30, 2016USD ($)
Expected post-remediation liability	$ 100
Description of post-remediation liability	Estimates will be incurred over approximately the next two years.

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - Subsequent Event [Member] $ in Thousands	Oct. 03, 2016USD ($)shares
First Amendment to Fourth Amended and Restate Loan and Security Agreement (the 2015 Loan Agreement) [Member] | Revolving Credit Facility [Member]
Maximum amount outstanding	$ 100,000
Maximum incremental availability on eligible accounts receivable and inventory	5,000
Stock Purchase Agreement [Member] | Houston Wire & Cable (HWC) Reporting Unit [Member] | Vertex Corporate Holdings, Inc (DXP Enterprises, Inc) [Member]
Purchase price	$ 32,300
Number of shares granted to four management team | shares	21,000