Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Cover [Abstract] | ||
Entity Registrant Name | Houston Wire & Cable CO | |
Entity Central Index Key | 0001356949 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-52046 | |
Entity Incorporation, State or Country Code | DE | |
Title of 12(b) Security | Common stock, par value $0.001 per share | |
Trading Symbol | HWCC | |
Security Exchange Name | NASDAQ | |
Entity Reporting Status Current | Yes | |
Entity Interactive Data Current | Yes | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Filer Category | Accelerated Filer | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 16,584,460 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Consolidated Balance Sheets (un
Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash | $ 3,536 | $ 4,096 |
Accounts receivable, net: | ||
Trade | 55,054 | 50,325 |
Other | 2,114 | 6,640 |
Inventories, net | 109,383 | 114,069 |
Income taxes | 1,017 | 1,353 |
Prepaids and other current assets | 3,157 | 1,833 |
Total current assets | 174,261 | 178,316 |
Property and equipment, net | 15,399 | 14,589 |
Intangible assets, net | 9,888 | 10,282 |
Goodwill | 22,353 | 22,353 |
Deferred income taxes | 704 | 600 |
Operating lease right-of-use assets, net | 12,962 | 13,481 |
Other assets | 506 | 527 |
Total assets | 236,073 | 240,148 |
Current liabilities: | ||
Trade accounts payable | 14,651 | 13,858 |
Accrued and other current liabilities | 15,332 | 23,261 |
Operating lease liabilities | 2,783 | 2,742 |
Total current liabilities | 32,766 | 39,861 |
Debt | 85,920 | 83,500 |
Operating lease long term liabilities | 10,652 | 11,182 |
Other long term liabilities | 2,234 | 1,977 |
Total liabilities | 131,572 | 136,520 |
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: 16,584,460 and 16,556,950 outstanding at March 31, 2020 and December 31, 2019, respectively | 21 | 21 |
Additional paid-in-capital | 52,276 | 52,304 |
Retained earnings | 109,171 | 108,626 |
Treasury stock | (56,967) | (57,323) |
Total stockholders' equity | 104,501 | 103,628 |
Total liabilities and stockholders' equity | $ 236,073 | $ 240,148 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
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 | ||
Preferred stock, outstanding | ||
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 | 16,584,460 | 16,556,950 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Sales | $ 83,533 | $ 85,270 |
Cost of sales | 63,941 | 64,011 |
Gross profit | 19,592 | 21,259 |
Operating expenses: | ||
Salaries and commissions | 9,474 | 9,180 |
Other operating expenses | 7,565 | 7,663 |
Depreciation and amortization | 767 | 553 |
Impairment charge | 200 | |
Total operating expenses | 18,006 | 17,396 |
Operating income | 1,586 | 3,863 |
Interest expense | 813 | 741 |
Income before income taxes | 773 | 3,122 |
Income tax expense | 228 | 838 |
Net income | $ 545 | $ 2,284 |
Earnings per share: | ||
Basic (in dollars per share) | $ 0.03 | $ 0.14 |
Diluted (in dollars per share) | $ 0.03 | $ 0.14 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 16,387,460 | 16,477,855 |
Diluted (in shares) | 16,436,293 | 16,577,126 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Total |
Balance at Beginning at Dec. 31, 2018 | $ 21 | $ 53,514 | $ 105,975 | $ (58,832) | $ 100,678 |
Balance at Beginning (in shares) at Dec. 31, 2018 | 20,988,952 | (4,377,301) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 2,284 | 2,284 | |||
Repurchase of treasury shares | $ (8) | (8) | |||
Repurchase of treasury shares (in shares) | (1,506) | ||||
Amortization of unearned stock compensation | $ 342 | 342 | |||
Impact of released restricted stock units | $ 16 | 16 | |||
Impact of released restricted stock units (in shares) | 2,251 | ||||
Impact of adoption of ASU 2016-02 | $ 101 | 101 | |||
Balance at Ending at Mar. 31, 2019 | $ 21 | $ 53,856 | 108,360 | $ (58,824) | 103,413 |
Balance at Ending (in shares) at Mar. 31, 2019 | 20,988,952 | (4,376,556) | |||
Balance at Beginning at Dec. 31, 2019 | $ 21 | $ 52,304 | 108,626 | $ (57,323) | 103,628 |
Balance at Beginning (in shares) at Dec. 31, 2019 | 20,988,952 | (4,432,002) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 545 | 545 | |||
Repurchase of treasury shares | |||||
Repurchase of treasury shares (in shares) | |||||
Amortization of unearned stock compensation | $ 328 | 328 | |||
Impact of released restricted stock units | $ (356) | $ 356 | |||
Impact of released restricted stock units (in shares) | 27,510 | ||||
Impact of adoption of ASU 2016-02 | |||||
Balance at Ending at Mar. 31, 2020 | $ 21 | $ 52,276 | $ 109,171 | $ (56,967) | $ 104,501 |
Balance at Ending (in shares) at Mar. 31, 2020 | 20,988,952 | (4,404,492) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating activities | ||
Net income | $ 545 | $ 2,284 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Impairment charge | 200 | |
Depreciation and amortization | 767 | 553 |
Amortization of unearned stock compensation | 328 | 342 |
Non-cash lease expense | 904 | 986 |
Provision for refund liability | 18 | 559 |
Provision for inventory obsolescence | 173 | 170 |
Deferred income taxes | (104) | 284 |
Other non-cash items | 62 | 34 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (253) | (723) |
Inventories | 4,513 | (1,170) |
Prepaids | (1,238) | (1,005) |
Other assets | (77) | (549) |
Lease payments | (907) | (982) |
Trade accounts payable | 793 | (3,424) |
Accrued and other current liabilities | (8,281) | (6,460) |
Income taxes | 336 | 534 |
Other operating activities | 257 | 93 |
Net cash used in operating activities | (1,964) | (8,474) |
Investing activities | ||
Expenditures for property and equipment | (857) | (278) |
Net cash used in investing activities | (857) | (278) |
Financing activities | ||
Borrowings on revolver | 85,653 | 94,333 |
Payments on revolver | (83,233) | (86,709) |
Release of treasury stock/stock surrendered on vested awards | 8 | |
Lease payments | (159) | (17) |
Net cash provided by financing activities | 2,261 | 7,615 |
Net change in cash | (560) | (1,137) |
Cash at beginning of period | 4,096 | 1,393 |
Cash at end of period | 3,536 | 256 |
Supplemental disclosures of non-cash activities | ||
Purchase of assets under finance leases | $ 526 | $ 11 |
Basis of Presentation and Princ
Basis of Presentation and Principles of Consolidation | 3 Months Ended |
Mar. 31, 2020 | |
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 industrial products including Electrical Wire and Cable, Steel Wire Rope and Hardware, and Fasteners to the U.S. market through twenty-two locations in fourteen states throughout the United States. The Company has no other business activity. The consolidated financial statements as of March 31, 2020 and for the three months ended March 31, 2020 and 2019 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 intercompany 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 allowance for doubtful accounts, the refund liability, the inventory obsolescence reserve, vendor rebates, the realization of deferred tax assets and the valuation of goodwill and indefinite-lived assets. 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, 2019 filed with the SEC. Recently Adopted Accounting Standards 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 are ASUs that were recently adopted by the Company. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” The amendments in this update eliminate, add and modify certain disclosure requirements for fair value measurements as part of the FASB’s disclosure framework project. The Company adopted this ASU in the first quarter of 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The amendments in this update require implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the non-cancellable term of the cloud computing arrangement plus any option renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The Company adopted this ASU in the first quarter of 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. Recent Accounting Pronouncements In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. This ASU, among other narrow-scope improvements, clarifies guidance around how to report expected recoveries. This ASU permits organizations to record expected recoveries on assets purchased with credit deterioration. In addition to other narrow technical improvements, the ASU also reinforces existing guidance that prohibits organizations from recording negative allowances for available-for-sale debt securities. The effective date and transition methodology are the same as in ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The FASB deferred the effective dates of this ASU for smaller reporting companies (“SRC”) to fiscal years beginning after December 15, 2022. As of March 31, 2020, the Company qualifies as a SRC and will adopt this ASU in the first quarter of 2023. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This ASU removes specific exceptions to the general principles in Topic 740 in GAAP. It eliminates the need for an organization to analyze whether certain exceptions apply in a given period. This ASU also improves financial statement preparers’ application of income tax-related guidance and simplifies GAAP for: a) Franchise taxes that are partially based on income; b) Transactions with a government that result in a step up in the tax basis of goodwill; c) Separate financial statements of legal entities that are not subject to tax; and d) Enacted changes in tax laws in interim periods. For public business entities, ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently assessing the impact of this ASU on its consolidated financial statements. |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | 2. Earnings per Share Basic earnings per share is calculated by dividing net income by the weighted average number of common shares outstanding. Diluted earnings per share include the dilutive effects of options and unvested restricted stock awards and units. The following reconciles the denominator used in the calculation of diluted earnings per share: Three Months Ended March 31, 2020 2019 Denominator: Weighted average common shares outstanding for basic earnings per share 16,387,460 16,477,855 Effect of dilutive securities 48,833 99,271 Weighted average common shares outstanding for diluted earnings per share 16,436,293 16,577,126 Stock awards to purchase 553,547 shares and 356,890 shares of common stock were not included in the diluted net income per share calculation for the three months ended March 31, 2020 and 2019, respectively, as their inclusion would have been anti-dilutive. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 3. Debt On March 12, 2019 and December 10, 2019, the Company, as guarantor, HWC Wire & Cable Company and Vertex, as borrowers, and Bank of America, N.A., as agent and lender, entered into the Second and Third Amendments, respectively, to the Fourth Amended and Restated Loan and Security Agreement (such agreement, as so amended, the “Loan Agreement”). The Second Amendment extended the expiration date until March 12, 2024 and the Third Amendment increased the revolving credit facility to $115 million. Under certain circumstances the Company may request an increase in the commitment by an additional $50 million. 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. Availability under the 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 Loan Agreement is secured by substantially all of the property of the Company, other than real estate. The 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 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 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 March 12, 2024. At March 31, 2020, 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.” |
Impairment of Goodwill and Inta
Impairment of Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of Goodwill and Intangible Assets | 4. Impairment of Goodwill and Intangible Assets The Company tests goodwill and indefinite lived intangibles for impairment at least annually or more frequently whenever events or circumstances occur indicating that it might be impaired. During the first quarter of 2020, the Company’s market capitalization declined significantly, driven by current macroeconomic and geopolitical conditions due in large part to the COVID-19 outbreak, which has contributed to decline in demand for the Company’s products, a decline in overall financial performance, partially due to the decline in oil prices, and decline in industry and market conditions. Based on these events, the Company concluded that it was more-likely-than-not that the fair value of certain of its reporting units were less than their carrying values. Therefore, the Company performed an interim goodwill impairment test. Goodwill impairment is evaluated at each of the four reporting units. The Company determined the fair values of two reporting units with goodwill and certain of its indefinite lived intangibles |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 5. Income Taxes The effective tax rate for the three months ended March 31, 2020 was 29.5% compared to 26.8% for the same period in 2019. Compared to the U.S. statutory rate, the effective tax rate was impacted by state income taxes and nondeductible expenses. Due to the continuing uncertainty in the Company’s industry, the Company has utilized the method of recording income taxes on a year-to-date effective tax rate for the three months ended March 31, 2020. The Company will evaluate its use of this method each quarter until such time as a return to the annualized estimated effective tax rate method is deemed appropriate. The Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020. The CARES Act contains several tax law changes for corporations, including modifications for net operating loss carrybacks, the refundability of prior-year minimum tax liability, limitations on business interest and limitations on charitable contribution deductions. These benefits did not impact the Company’s tax provision for the three months ended March 31, 2020. |
Incentive Plans
Incentive Plans | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Incentive Plans | 6. Incentive Plans Stock Option Awards There were no stock option awards granted during the first three months of 2020 or 2019. Restricted Stock Awards and Restricted Stock Units There were no restricted stock awards or units granted during the first three months of 2020. On March 12, 2019, the Board of Directors granted 52,910 performance stock units to the Company’s President and CEO and 13,228 performance stock units to the CFO. Each grant of performance stock units vests on December 31, 2021, based on and subject to the Company’s achievement of cumulative EBITDA and stock price performance goals over a three-year period, as long as the grantee is then employed by the Company, and upon vesting will be settled in shares of our common stock. Any dividends declared will be accrued and paid to the grantee if and when the related shares vest. Total stock-based compensation cost was $0.3 million for each of the three months ended March 31, 2020 and 2019, respectively, and is included in salaries and commissions for employees, and in other operating expenses for non-employee directors. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies The Company had outstanding under the Loan Agreement letters of credit totaling $0.7 million to certain vendors as of March 31, 2020. From time to time, the Company is involved in lawsuits that are brought against us in the normal course of business. The Company is not currently a party to any legal proceedings that it expects, either individually or in the aggregate, to have a material adverse effect on the Company’s consolidated financial position, cash flows, or results from operations. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 8. Subsequent Events The COVID-19 pandemic has spread throughout the United States and the countries in which our offshore suppliers are located. Governments in affected regions have implemented, and may continue to implement, safety precautions which include quarantines, travel restrictions, business closures, cancellations of public gatherings and other measures as they deem necessary. Many organizations and individuals, including the Company and its employees are taking additional steps to avoid or reduce infection, including limiting travel and working remotely. The Company continues to monitor its operations and government recommendations and has made modifications to its normal operations because of the pandemic, including requiring most of its non-essential employees to work remotely. The Company has maintained a substantial portion of its operational capacity at its warehouses across the continental United States and has instituted several health and safety protocols and procedures to safeguard its employees. The rapid development and uncertainty of the COVID-19 pandemic precludes any prediction as to the ultimate adverse impact of the COVID-19 outbreak on the Company’s business. However, the outbreak has caused the Company to experience adverse impacts, including reductions in the demand for its products. In response, the Company has implemented several cost savings measures which include furloughing employees, payroll reductions, and other measures to decrease corporate and non-critical expenses. While we cannot reasonably estimate the length or severity of this pandemic, we currently anticipate an adverse impact on our consolidated financial position, consolidated results of operations, and consolidated cash flows in fiscal 2020. On May 4, 2020, the Company received a $6.2 million Payroll Protection Program loan from Bank of America, funded under the CARES Act. The loan has a 1.0% interest rate after a six-month deferment period. |
Basis of Presentation and Pri_2
Basis of Presentation and Principles of Consolidation (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards 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 are ASUs that were recently adopted by the Company. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement.” The amendments in this update eliminate, add and modify certain disclosure requirements for fair value measurements as part of the FASB’s disclosure framework project. The Company adopted this ASU in the first quarter of 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, “Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” The amendments in this update require implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the non-cancellable term of the cloud computing arrangement plus any option renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The Company adopted this ASU in the first quarter of 2020, and the adoption did not have a material impact on the Company’s consolidated financial statements. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In November 2019, the FASB issued ASU 2019-11, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. This ASU, among other narrow-scope improvements, clarifies guidance around how to report expected recoveries. This ASU permits organizations to record expected recoveries on assets purchased with credit deterioration. In addition to other narrow technical improvements, the ASU also reinforces existing guidance that prohibits organizations from recording negative allowances for available-for-sale debt securities. The effective date and transition methodology are the same as in ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The FASB deferred the effective dates of this ASU for smaller reporting companies (“SRC”) to fiscal years beginning after December 15, 2022. As March 31, 2020, the Company qualifies as a SRC and will adopt this ASU in the first quarter of 2023. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. This ASU removes specific exceptions to the general principles in Topic 740 in GAAP. It eliminates the need for an organization to analyze whether certain exceptions apply in a given period. This ASU also improves financial statement preparers’ application of income tax-related guidance and simplifies GAAP for: a) Franchise taxes that are partially based on income; b) Transactions with a government that result in a step up in the tax basis of goodwill; c) Separate financial statements of legal entities that are not subject to tax; and d) Enacted changes in tax laws in interim periods. For public business entities, ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company is currently assessing the impact of this ASU on its consolidated financial statements. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of diluted earnings per share | The following reconciles the denominator used in the calculation of diluted earnings per share: Three Months Ended March 31, 2020 2019 Denominator: Weighted average common shares outstanding for basic earnings per share 16,387,460 16,477,855 Effect of dilutive securities 48,833 99,271 Weighted average common shares outstanding for diluted earnings per share 16,436,293 16,577,126 |
Earnings per Share (Details)
Earnings per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Denominator: | ||
Weighted average common shares outstanding for basic earnings per share | 16,387,460 | 16,477,855 |
Effect of dilutive securities | 48,833 | 99,271 |
Weighted average common shares outstanding for diluted earnings per share | 16,436,293 | 16,577,126 |
Earnings per Share (Details Nar
Earnings per Share (Details Narrative) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Options to purchase stock awards | 553,547 | 356,890 |
Debt (Details Narrative)
Debt (Details Narrative) - USD ($) $ in Thousands | Dec. 10, 2019 | Mar. 12, 2019 | Mar. 31, 2020 | Oct. 03, 2016 |
Description of collateral | The Loan Agreement is secured by substantially all of the property of the Company, other than real estate. | |||
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% | |||
Revolving Credit Facility [Member] | Fourth Amended and Restated Loan and Security Agreement (the 2015 Loan Agreement) [Member] | ||||
Minimum amount outstanding | $ 100,000 | |||
Expiration date | Mar. 12, 2024 | |||
Additional commitment amount | $ 50,000 | |||
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% | |||
Revolving Credit Facility [Member] | Third Amended and Restated Loan and Security Agreement (the 2015 Loan Agreement) [Member] | ||||
Minimum amount outstanding | $ 115,000 |
Impairment of Goodwill and In_2
Impairment of Goodwill and Intangible Assets (Details Narrative) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Southern Reporting Unit [Member] | Tradenames [Member] | |
Impairment charge | $ 200 |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 29.50% | 26.80% |
Incentive Plans (Details Narrat
Incentive Plans (Details Narrative) - USD ($) $ in Thousands | Mar. 12, 2019 | Mar. 31, 2020 | Mar. 31, 2019 |
Stock-based compensation cost | $ 328 | $ 342 | |
Number of units grants | 0 | 0 | |
Number of units grants, value | $ 0 | $ 0 | |
Chief Financial Officer [Member] | Performance Stock Units [Member] | |||
Number of shares granted under plan | 13,228 | ||
Expiration date | Dec. 31, 2021 | ||
Term of vesting period | 3 years | ||
President And Chief Executive Officer [Member] | |||
Number of shares granted under plan | 52,910 | ||
Non Employee Directors [Member] | Restricted Stock Awards [Member] | |||
Stock-based compensation cost | $ 300 | $ 300 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) $ in Thousands | Mar. 31, 2020USD ($) |
Vendors [Member] | Loan Agreement [Member] | |
Outstanding line of credit | $ 700 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] - Payroll Protection Program [Member] - Bank of America [Member] $ in Thousands | May 04, 2020USD ($) |
Subsequent Event [Line Items] | |
Loan face amount | $ 6,200 |
Loan interest rate | The loan has a 1.0% interest rate after a six-month deferment period. |