Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 30, 2016 | Jun. 30, 2015 | |
Document And Entity Information | |||
Entity Registrant Name | WESTERN CAPITAL RESOURCES, INC. | ||
Entity Central Index Key | 1,363,958 | ||
Document Type | 10-K | ||
Trading Symbol | WCRS | ||
Document Period End Date | Dec. 31, 2015 | ||
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 | Smaller Reporting Company | ||
Entity Public Float | $ 2,202,000 | ||
Entity Common Stock, Shares Outstanding | 9,497,534 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,015 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
CURRENT ASSETS | ||
Cash | $ 7,847,669 | $ 4,273,350 |
Loans receivable (less allowance for losses of $1,177,000 and $1,219,000, respectively) | 4,884,438 | 5,331,266 |
Accounts receivable (less allowance for losses of $272,000 and $59,405, respectively) | 1,963,192 | 1,135,127 |
Inventory | 7,617,850 | 2,340,824 |
Prepaid expenses and other | 2,589,749 | 1,435,918 |
Deferred income taxes | 563,000 | 644,000 |
TOTAL CURRENT ASSETS | 25,465,898 | 15,160,485 |
PROPERTY AND EQUIPMENT, net | 8,561,321 | 1,197,710 |
GOODWILL | 13,355,591 | 12,956,868 |
INTANGIBLE ASSETS, net | 8,018,616 | 7,248,793 |
OTHER | 783,907 | 198,408 |
TOTAL ASSETS | 56,185,333 | 36,762,264 |
CURRENT LIABILITIES | ||
Accounts payable | 4,577,118 | 699,692 |
Accrued expenses and other liabilities | 6,232,267 | 5,326,228 |
Income taxes payable | 1,135,031 | 755,615 |
Current portion long-term debt | 4,900,008 | 3,500,000 |
Current portion capital lease obligations | 23,860 | 42,240 |
Deferred revenue and other | 1,796,338 | 638,068 |
TOTAL CURRENT LIABILITIES | 18,664,622 | 10,961,843 |
LONG-TERM LIABILITIES | ||
Notes payable, net of current portion | 3,096,452 | 1,625,000 |
Capital lease obligations, net of current portion | 33,347 | 31,481 |
Deferred income taxes | 4,452,000 | 3,939,000 |
Other | 80,403 | 114,514 |
TOTAL LONG-TERM LIABILITIES | 7,662,202 | 5,709,995 |
TOTAL LIABILITIES | $ 26,326,824 | $ 16,671,838 |
COMMITMENTS AND CONTINGENCIES (Note 15) | ||
WESTERN SHAREHOLDERS' EQUITY | ||
Common stock, no par value, 12,500,000 shares authorized, 9,497,534 and 5,997,588 issued and outstanding. | ||
Additional paid-in capital | $ 28,934,392 | $ 22,703,745 |
Retained earnings (accumulated deficit) | 898,038 | (2,621,692) |
TOTAL WESTERN SHAREHOLDERS' EQUITY | 29,832,430 | 20,082,053 |
NONCONTROLLING INTERESTS | 26,079 | 8,373 |
TOTAL EQUITY | 29,858,509 | 20,090,426 |
TOTAL LIABILITIES AND EQUITY | $ 56,185,333 | $ 36,762,264 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Loans receivable, allowance (in dollars) | $ 1,177,000 | $ 1,219,000 |
Accounts receivable, allowance (in dollars) | $ 272,000 | $ 59,405 |
Common Stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, authorized | 12,500,000 | 12,500,000 |
Common stock, issued | 9,497,534 | 5,997,588 |
Common stock, outstanding | 9,497,534 | 5,997,588 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
REVENUES | ||
Sales and associated fees | $ 46,243,284 | $ 22,535,116 |
Financing fees and interest | 10,772,785 | 11,123,882 |
Royalty and franchise fees, net | 10,770,914 | 2,814,273 |
Other revenue | 8,667,052 | 4,286,282 |
TOTAL REVENUES | 76,454,035 | 40,759,553 |
COST OF REVENUES | ||
Cost of sales | 25,209,412 | 12,714,413 |
Provisions for loans receivable losses | 1,904,893 | 1,817,822 |
Other | 1,196,172 | 168,952 |
Total Cost of Revenues | 28,310,477 | 14,701,187 |
GROSS PROFIT | 48,143,558 | 26,058,366 |
OPERATING EXPENSES | ||
Salaries, wages and benefits | 20,859,080 | 11,593,794 |
Occupancy | 6,570,537 | 4,610,807 |
Advertising, marketing and development | 4,164,473 | 478,261 |
Depreciation | 697,956 | 368,827 |
Amortization | 499,697 | 187,669 |
Other | 8,761,172 | 4,547,955 |
TOTAL OPERATING EXPENSES | 41,552,915 | 21,787,313 |
OPERATING INCOME | 6,590,643 | 4,271,053 |
OTHER INCOME (EXPENSES): | ||
Interest income | 4,269 | 1,807 |
Interest expense | (575,712) | (315,568) |
TOTAL OTHER INCOME (EXPENSES) | (571,443) | (313,761) |
INCOME BEFORE INCOME TAXES | 6,019,200 | 3,957,292 |
INCOME TAX EXPENSE | 2,481,764 | 1,545,860 |
NET INCOME | 3,537,436 | 2,411,432 |
Less net income attributable to noncontrolling interests | (17,706) | (5,546) |
NET INCOME ATTRIBUTABLE TO WESTERN COMMON SHAREHOLDERS | $ 3,519,730 | $ 2,405,886 |
EARNINGS PER SHARE ATTRIBUTABLE TO WESTERN COMMON SHAREHOLDERS | ||
Basic and diluted (in dollars per share) | $ 0.45 | $ 0.64 |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||
Basic and diluted (in shares) | 7,761,918 | 3,763,726 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings / (Accumulated Deficit) [Member] | Noncontrolling Interests [Member] | Total |
BALANCE at beginning at Dec. 31, 2013 | $ 22,353,600 | $ (5,027,578) | $ 17,326,022 | ||
BALANCE at beginning (in shares) at Dec. 31, 2013 | 3,011,009 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Fractional shares repurchased | (388) | (388) | |||
Fractional shares repurchased (in shares) | (244) | ||||
Shares of common stock issued October 1, 2014 for AlphaGraphics entities acquisition | 350,533 | $ 6,859 | 357,392 | ||
Shares of common stock issued October 1, 2014 for AlphaGraphics entities acquisition (in shares) | 2,986,823 | ||||
Net Income | $ 2,405,886 | 5,546 | 2,411,432 | ||
Distributions made by subsidiary to noncontrolling interests | (4,032) | (4,032) | |||
BALANCE at end at Dec. 31, 2014 | 22,703,745 | $ (2,621,692) | $ 8,373 | 20,090,426 | |
BALANCE at end (in shares) at Dec. 31, 2014 | 5,997,588 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares of common stock issued July 1, 2015 for JPPA/RAI acquisition | $ 6,123,398 | $ 6,123,398 | |||
Shares of common stock issued July 1, 2015 for JPPA/RAI acquisition (in shares) | 3,500,000 | ||||
Removal of partial shares | |||||
Removal of partial shares (in shares) | (54) | ||||
Net Income | $ 3,519,730 | $ 17,706 | $ 3,537,436 | ||
Share based compensation | $ 107,249 | 107,249 | |||
BALANCE at end at Dec. 31, 2015 | $ 28,934,392 | $ 898,038 | $ 26,079 | $ 29,858,509 | |
BALANCE at end (in shares) at Dec. 31, 2015 | 9,497,534 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
OPERATING ACTIVITIES | ||
Net Income | $ 3,537,436 | $ 2,411,432 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 697,956 | 368,827 |
Amortization | 499,697 | $ 187,669 |
Share based compensation | 107,249 | |
Deferred income taxes | 611,000 | $ 349,000 |
Loss on disposal of property, equipment and other assets | 447,790 | 14,088 |
Changes in operating assets and liabilities: | ||
Loans receivable | 446,828 | 106,936 |
Accounts receivable | (300,699) | 91,633 |
Inventory | (1,679,584) | (761,957) |
Prepaid expenses and other assets | $ (785,181) | (424,072) |
Note receivable | 636,196 | |
Accounts payable and accrued liabilities | $ 1,169,915 | 1,478,484 |
Deferred revenue and other current liabilities | 697,838 | (12,497) |
Accrued liabilities and other | (34,111) | (30,446) |
Net cash provided by operating activities | 5,416,134 | 4,415,293 |
INVESTING ACTIVITIES | ||
Purchases of property and equipment | $ (766,625) | (237,161) |
Purchase of intangible assets | (250,000) | |
Acquisition of stores, net of cash acquired | $ (2,698,500) | (166,800) |
Cash received through acquisitions | 2,470,930 | 168,254 |
Net cash used in investing activities | (994,195) | $ (485,707) |
FINANCING ACTIVITIES | ||
Payments on notes payable - short-term, net | (120,000) | |
Payments on notes payable - long-term, net | $ (666,670) | $ (1,625,000) |
Common stock redemption | (388) | |
Payments on capital lease | $ (60,950) | (10,651) |
Subsidiary distributions to noncontrolling interests | (4,032) | |
Net cash used in financing activities | $ (847,620) | (1,640,071) |
NET INCREASE IN CASH | 3,574,319 | 2,289,515 |
CASH | ||
Beginning of year | 4,273,350 | 1,983,835 |
End of year | 7,847,669 | 4,273,350 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Income taxes paid | 2,046,817 | 449,972 |
Interest paid | 549,361 | 312,817 |
Noncash investing and financing activities: | ||
Shares issued and net assets acquired in acquisitions (Notes 11 and 13) | $ 6,123,398 | 350,533 |
Receivable from sale of intangible asset | $ 10,000 | |
Deposit applied to purchase of intangibles | $ 50,000 |
Basis of Presentation, Nature o
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies | 1. Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies Basis of Presentation / Nature of Business Western Capital Resources, Inc. (WCR) is a parent company owning operating subsidiaries, with percentage owned shown parenthetically, as summarized below. · Franchise o AlphaGraphics, Inc. (AGI) (99.2% Acquired October 1, 2014) franchisor of 254 domestic and 25 international AlphaGraphics Business Centers which specialize in the planning, production, and management of visual communications for businesses and individuals throughout the world. · Cellular Retail o PQH Wireless, Inc. (PQH) (100%) owns and operates cellular retail stores (99 as of December 31, 2015), as an exclusive dealer of the Cricket brand. · Direct to Consumer o J & P Park Acquisitions, Inc. (JPPA) (100% Acquired July 1, 2015) an online and direct marketing distribution retailer of live plants, seeds, holiday gifts and garden accessories selling its products under Park Seed, Jackson & Perkins, and Wayside Gardens brand names as well as a wholesaler under the Park Wholesale brand. o Restorers Acquisition, Inc. (RAI) (100% Acquired July 1, 2015) an online and direct marketing distribution retailer of home improvement and restoration products operating under Van Dykes Restorers. o J & P Real Estate, LLC (JPRE) (100% Acquired July 1, 2015) owns real estate utilized as JPPAs distribution and warehouse facility and the corporate offices of JPPA and RAI. · Consumer Finance o Wyoming Financial Lenders, Inc. (WFL) (100%) owns and operates payday stores (46 as of December 31, 2015) in eight states (Colorado, Iowa, Kansas, Nebraska, North Dakota, South Dakota, Wisconsin and Wyoming) providing sub-prime short-term uncollateralized non-recourse cash advance or payday loans typically ranging from $100 to $500 with a maturity of generally two to four weeks, sub-prime short-term uncollateralized non-recourse installment loans typically ranging from $300 to $800 with a maturity of six months, check cashing and other money services to individuals. o Express Pawn, Inc. (EPI) (100%) owns and operates retail pawn stores (three as of December 31, 2015) in Nebraska and Iowa providing collateralized non-recourse pawn loans and retail sales of merchandise obtained from forfeited pawn loans or purchased from customers. References in these financial statement notes to Company or we refer to Western Capital Resources, Inc. and its subsidiaries. References to specific companies within our enterprise, such AGI, PQH, JPPA, RAI, JPRE, WFL or EPI are references only to those companies. Basis of Consolidation The consolidated financial statements include the accounts of the WCR, its wholly owned subsidiaries and other entities in which the Company owns a controlling financial interest. For financial interests in which the Company owns a controlling financial interest, the Company applies the provisions of ASC 810 applicable to reporting the equity and net income or loss attributable to noncontrolling interests. All significant intercompany balances and transactions of the Company have been eliminated in consolidation. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect certain reported amounts and disclosures in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant management estimates relate to the notes and loans receivable allowance, carrying value and impairment of long-lived goodwill and intangible assets, inventory valuation and obsolescence, estimated useful lives of property and equipment, gift certificate liability and deferred taxes and tax uncertainties. Revenue Recognition Franchise Royalty revenues from franchisees are primarily based on a percentage of business center sales and are recognized in the period in which they are earned. Initial franchise fee revenues are recognized when the obligations required by the franchise agreement have been substantially performed by AGI, which is generally upon the training of the franchisee. Revenues from area development franchise fees and International Master License Agreement (IML) fees are recognized when the obligations required by the area development and IML agreements have been substantially performed. Supply sales, service fees and other revenues are recognized when products have been shipped or services provided. Cellular Retail Sales revenue for sales of phones and accessories and dealer compensation for related activations is recognized in the period in which the sale is completed (retail sales and associated fees). Customer service fees are recognized upon completion of the service and payment received. Other dealer compensation not attributed to phone activations is recorded in the period earned as reported to us by Cricket Wireless. All sales are presented net of sales taxes, which are excluded from revenue. Direct to Consumer Sales revenue is recognized in the period in which product is shipped. Sales billed or cash received in advance of actual shipment are deferred and recorded as income in the period in which shipment is made. Shipping and handling fees billed to customers is included in net sales. Shipping and handling costs are expensed as incurred and included in cost of sales. All sales are presented net of sales taxes, which are excluded from revenue. Consumer Finance Loan fees and interest on cash advance loans are recognized on a constant-yield basis ratably over a loans term. Title and installment loan fees and interest are recognized using the interest method, except that installment loan origination fees are recognized as they become non-refundable and installment loan maintenance fees are recognized when earned. The Company recognizes fees on pawn loans on a constant-yield basis ratably over the loans terms. No fees are recognized on forfeited pawn loans. Receivables and Loss Allowance Franchise Accounts receivable are recorded for earned but uncollected royalties and other related franchise fees. Allowances are provided on an account-by-account basis for estimated uncollectible accounts as deemed necessary by management. The Company considers current economic trends and changes in payment terms when evaluating the adequacy of the allowance. Direct to Consumer Receivables, for noncash sales, are recorded when orders are shipped and represent claims against third parties that will be settled in cash. The carrying value of receivables, net of the allowance for doubtful accounts, represents their estimated net realizable value. The allowance for doubtful accounts is estimated based on historical collection trends, type of customer, the age of outstanding receivables and existing economic conditions. If events or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. Past due receivable balances are written-off when internal collection efforts have been unsuccessful in collecting the amount due. Consumer Finance Included in loans receivable are unpaid principal, interest and fee balances of payday, installment, pawn and title loans that have not reached their maturity date, and late payday loans that have reached maturity within the last 180 days and have remaining outstanding balances. Late payday loans generally are unpaid loans where a customers personal check has been deposited and the check has been returned due to non-sufficient funds in the customers account, a closed account, or other reasons. All returned items are charged-off after 180 days, as collections after that date have not been significant. Loans are carried at cost plus accrued interest or fees less payments made and a loans receivable allowance. The Company does not specifically reserve for any individual payday, installment or title loan. The Company aggregates loan types for purposes of estimating the loss allowance using a methodology that analyzes historical portfolio statistics and managements judgment regarding recent trends noted in the portfolio. This methodology takes into account several factors, including (1) the amount of loan principal, interest and fee outstanding, (2) historical charge offs from loans that originated during the last 24 months, (3) current and expected collection patterns and (4) current economic trends. The Company utilizes a software program to assist with the tracking of its historical portfolio statistics. A loan loss allowance is maintained for anticipated losses for payday and installment loans based primarily on our historical percentages by loan type of net charge offs, applied against the applicable balance of loan principal, interest and fees outstanding. The Company also periodically performs a look-back analysis on its loan loss allowance to verify the historical allowance established tracks with the actual subsequent loan write-offs and recoveries. The Company is aware that as conditions change, it may also need to make additional allowances in future periods. Loan losses or charge-offs of pawn or title loans are not recorded because the value of the collateral exceeds the loan amount. Inventory Cellular Retail Inventory, consisting of phones and accessories, is stated at cost, determined on the specific identification and a first-in, first-out basis, respectively. Direct to Consumer Inventory is valued at the lower of cost or market using the weighted-average method of determining cost. Consumer Finance Merchandise inventory is stated at the lower of cost or market. The principal amount of an unpaid loan becomes the inventory cost for forfeited collateral. Property and Equipment Property and equipment are recorded at cost less accumulated depreciation. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets as follows: Computer equipment and software 3 10 years Improvements and equipment 3 15 years Building 39 years The cost of maintenance and repairs is charged to operations as incurred while renewals and betterments are capitalized. The Company capitalizes certain internal costs, including payroll costs, incurred in connection with the development of software for internal use. These costs are capitalized beginning when the Company has entered the application development stage. The capitalization of these costs ceases when the software is substantially complete and ready for its intended use. Costs incurred for enhancements that are expected to result in additional features or functionality are capitalized and expensed over the estimated useful life of the enhancements. Goodwill Goodwill represents the excess of cost over the fair value of net assets acquired using purchase accounting and is not amortized. Intangible Assets Intangible assets represent the fair values management assigned to assets acquired through business acquisitions and is amortized over periods of three to 15 years based on managements estimates of the useful life of the asset. Long-Lived Assets The Company assesses the possibility of impairment of long-lived and intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant underperformance relative to expected historical or projected future cash flows, significant changes in the manner of use of acquired assets or the strategy for the overall business, and significant negative industry events or trends. In addition, the Company conducts an annual goodwill impairment test as of October 1 each year. The Company assesses goodwill for impairment at the reporting unit level by applying a fair value test. This fair value test involves a two-step process. The first step is to compare the carrying value of our net assets to our fair value. If the fair value is determined to be less than the carrying value, a second step is performed to measure the amount of the impairment, if any. Due to the minimal amount of public float for the Companys common stock, the market capitalization approach of valuing the reporting unit as a whole is not practical. The discounted future cash flows method is utilized in estimating value. When estimated future cash flows are less than the carrying value of the net assets and related goodwill, an impairment test is performed to measure and recognize the amount of the impairment loss, if any. There were no impairment charges recorded in 2015 or 2014. Merchandise Credits and Gift Card Liabilities Direct to Consumer The Company maintains a liability for unredeemed gift cards, gift certificates and merchandise credits until the earlier of redemption, escheatment or a maximum of two years. The Company has concluded based on historical redemption trends that the likelihood of these liabilities being redeemed beyond two years from the date of issuance is remote. Advertising, Marketing and Development Costs Franchise The costs of advertising, marketing and development are expenses as incurred. Certain amounts received from franchisees for marketing and advertising campaigns benefiting the franchisees are held in the AlphaGraphics Integrated Marketing Fund. AGI controls the manner in which these funds are spent. In addition to advertising, marketing and development expenses, fund expenses include general operating expenses such as reasonable salaries, travel related expenditures, administrative expenses, and overhead incurred by AGI on behalf of the fund. Amounts in the fund and the related revenues and expenses are not reflected in the accompanying consolidated financial statements. AGI may direct that the amount spent in any fiscal year is greater or less than the aggregate contributions made by the franchisees into the fund. Direct to Consumer The Company expenses advertising costs as they are incurred, except for direct-response advertising, which is capitalized and amortized over its expected period of future benefits, not to exceed six months. Direct-response advertising consists primarily of catalog book production, printing, and postage costs. Prepaid advertising costs at December 31, 2015 were $0.92 million. Consumer Finance The costs of advertising and marketing are expenses as incurred. Stock-based Compensation The Company accounts for its employee stock-based compensation plans using the fair value method. The fair value method requires the Company to estimate the grant-date fair value of its stock-based awards and amortize this fair value to compensation expense over the requisite service period or vesting term. The Company uses the Black-Scholes option-pricing model to estimate the fair value of the Companys stock option awards. The determination of the fair value of stock-based payment awards on the date of grant using an option-pricing model is affected by the Companys stock price as well as assumptions regarding a number of complex and subjective variables. These variables include the expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, the risk-free interest rate and expected dividends. Due to the inherent limitations of option-valuation models, future events that are unpredictable and the estimation process utilized in determining the valuation of the stock-based awards, the ultimate value realized by award holders may vary significantly from the amounts expensed in the Companys financial statements. Stock-based compensation expense is recognized net of estimated forfeitures such that expense is recognized only for those stock-based awards that are expected to vest. A forfeiture rate is estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimate. Income Taxes Deferred income taxes reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts, based on enacted tax laws and statutory tax rates applicable in the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. The provision for income taxes represents taxes paid or payable for the current year and changes during the year in deferred tax assets and liabilities. Net Income Per Common Share Basic net income per common share is computed by dividing the income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share gives effect to all potentially dilutive common shares outstanding during the period, including stock options, using the treasury stock method. Options to purchase 65,000 shares granted under the 2015 Stock Incentive Plan effective February 6, 2015 (see Note 11) were outstanding at December 31, 2015. These options have a strike price in excess of the market price as of December 31, 2015, were antidilutive and therefore not included in the computation of diluted earnings per share. Thus, there were no dilutive common shares as of December 31, 2015 and 2014. Fair Value of Financial Instruments The amounts reported in the balance sheets for cash, accounts and loans receivable, inventory, and accounts payable are short-term in nature and their carrying values approximate fair values. The amounts reported in the balance sheets for notes payable are both long-term and short-term and their carrying value approximates fair value. Reclassifications Certain Statement of Income reclassifications have been made in the presentation of our prior financial statements and accompanying notes to conform to the presentation as of and for the year ended December 31, 2015. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) jointly issued a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under US GAAP and IFRS. This converged standard is effective for annual and interim periods beginning after December 15, 2016. The Company is currently assessing the potential effects on our financial condition and results of operations and consolidated financial statements. In November 2014 the FASB issued ASU 2015-17, Income Taxes (Topic 740) Related to the Balance Sheet Classification of Deferred Taxes which will require entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. The ASU simplifies the current guidance (ASC 740-10-45-4), which requires entities to separately present DTAs and DTLs as current and noncurrent in a classified balance sheet. The ASU is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods, with early application permitted. The Company is currently assessing the potential effects on our consolidated financial position. No other new accounting pronouncements issued or effective during the fiscal year have had or are expected to have a material impact on the consolidated financial statements. |
Risks Inherent in the Operating
Risks Inherent in the Operating Environment | 12 Months Ended |
Dec. 31, 2015 | |
Risks and Uncertainties [Abstract] | |
Risks Inherent in the Operating Environment | 2. Risks Inherent in the Operating Environment Regulatory The Companys Consumer Finance segment activities are highly regulated under numerous local, state, and federal laws, regulations and rules, which are subject to change. New laws, regulations or rules could be enacted or issued, interpretations of existing laws, regulations or rules may change and enforcement action by regulatory agencies may intensify. Over the past several years, consumer advocacy groups and certain media reports have advocated governmental and regulatory action to prohibit or severely restrict sub-prime lending activities of the kind conducted by the Company. The federal Consumer Financial Protection Bureau has indicated that it will use its authority to further regulate the payday industry and has been actively assessing significant penalties or seeking settlement payments. Any adverse change in present local, state, and federal laws or regulations that govern or otherwise affect lending could result in the Consumer Finance segments curtailment or cessation of operations in certain or all jurisdictions or locations. Furthermore, any failure to comply with any applicable local, state or federal laws or regulations could result in fines, litigation, closure of one or more store locations or negative publicity. Any such change or failure would have a corresponding impact on the Companys and segments results of operations and financial condition, primarily through a decrease in revenues resulting from the cessation or curtailment of operations, decrease in operating income through increased legal expenditures or fines, and could also negatively affect the Companys general business prospects due to lost or decreased operating income or if negative publicity effects its ability to obtain additional financing as needed. In addition, the passage of federal or state laws and regulations or changes in interpretations of them could, at any point, essentially prohibit the Consumer Finance segment from conducting its lending business in its current form. Any such legal or regulatory change would certainly have a material and adverse effect on the Company, its operating results, financial condition and prospects, and perhaps even the viability of the Consumer Finance segment. Concentrations The Companys subsidiaries each have demand deposits at financial institutions, often times in excess of the limit for insurance by the Federal Deposit Insurance Corporation. As of December 31, 2015, the Company had demand deposits in excess of insurance amounts of approximately $5.69 million compared to $2.25 million at December 31, 2014. Loans receivable in the Consumer Finance segment are concentrated in the sub-prime market and geographically, primarily in the Midwest. For the years ended December 31, 2015 and 2014, the Consumer Finance segment had geographic economic and regulatory risk concentrations (shown as a percentage of applicable segments revenue by state when 10% or more) as follows: Consumer Finance Segment 2015 % of Revenues 2014 % of Revenues Nebraska 33 % 30 % North Dakota 19 % 18 % Wyoming 14 % 14 % Iowa 14 % 14 % The Companys Wireless Retail segment is an exclusive dealer for Cricket. As a dealer operating exclusively for a single carrier, the Company is subject to a number of concentrations, including revenues from a single brand, a single supplier for phones, a single operating system providers and select third party processors. Our Direct to Consumer subsidiary JPPA has an agreement with a third party wholesale grower that is in effect until 2019. The grower has agreed to perform research for JPPA and maintain JPPA's research crop in exchange for a reduction in royalties to be paid to JPPA for growing JPPA's patented roses. There is an option to renew the agreement for consecutive two year terms and the agreement calls for a 24 month notice prior to termination. RAI has an agreement with a single third-party fulfillment provider, Speed Commerce, Inc. Speed Commerce, Inc.is under extreme financial distress and is attempting to restructure its organization. The contract with the fulfillment provider expired in early 2016 and an extension agreement is currently being negotiated while we operate under a month to month agreement. The fulfillment provider receives and stores inventory, performs periodic cycle counts, picks, packs and ships customer orders. Additional services such as, order taking, processing of customer payments, personalization, customer services, and order processing are also performed by the fulfillment provider. |
Loans Receivable
Loans Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Loans Receivable | 3. Loans Receivable At December 31, 2015 and December 31, 2014, the Companys outstanding loans receivable aging was as follows: December 31, 2015 Payday Installment Pawn & Title Total Current $ 4,065,706 $ 291,947 $ 286,514 $ 4,644,167 1-30 332,217 43,179 - 375,396 31-60 263,486 24,233 - 287,719 61-90 199,526 16,293 - 215,819 91-120 196,123 9,417 - 205,540 121-150 160,386 4,985 - 165,371 151-180 165,237 2,189 - 167,426 5,382,681 392,243 286,514 6,061,438 Less Allowance (1,081,000 ) (96,000 ) - (1,177,000 ) $ 4,301,681 $ 296,243 $ 286,514 $ 4,884,438 December 31, 2014 Payday Installment Pawn & Total Current $ 4,387,393 $ 321,634 $ 372,805 $ 5,081,832 1-30 305,382 47,321 - 352,703 31-60 223,465 24,791 - 248,256 61-90 236,072 11,799 - 247,871 91-120 206,705 5,438 - 212,143 121-150 200,101 1,984 - 202,085 151-180 204,804 572 - 205,376 5,763,922 413,539 372,805 6,550,266 Less Allowance (1,147,000 ) (72,000 ) - (1,219,000 ) $ 4,616,922 $ 341,539 $ 372,805 $ 5,331,266 |
Loans Receivable Allowance
Loans Receivable Allowance | 12 Months Ended |
Dec. 31, 2015 | |
Provision for Loan and Lease Losses [Abstract] | |
Loans Receivable Allowance | 4. Loans Receivable Allowance As a result of the Companys Consumer Finance segments collection efforts, it historically writes off approximately 43% of the returned payday items, the most significant element making up loans receivable. Based on days past the check return date, write-offs of payday returned items historically have tracked at the following approximate percentages: 1 to 30 days 43%; 31 to 60 days 65%; 61 to 90 days 83%; 91 to 120 days 89%; and 121 to 150 91% and 151+ days 93%. A rollforward of the Companys loans receivable allowance for the years ended December 31, 2015 and 2014 is as follows: Year Ended December 31, 2015 2014 Loans receivable allowance, beginning of period $ 1,219,000 $ 1,215,000 Provision for loan losses charged to expense 1,904,893 1,817,822 Charge-offs, net (1,946,893 ) (1,813,822 ) Loans receivable allowance, end of period $ 1,177,000 $ 1,219,000 |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Accounts Receivable | 5. Accounts Receivable A breakdown of accounts receivables by segment as of December 31, 2015 and 2014 are as follows: December 31, 2015 Franchise Cellular Direct to Total Accounts receivable $ 1,332,446 $ 148,346 $ 754,400 $ 2,235,192 Less allowance (183,000 ) - (89,000 ) (272,000 ) Net account receivable $ 1,149,446 $ 148,346 $ 665,400 $ 1,963,192 December 31, 2014 Franchise Cellular Direct to Total Accounts receivable $ 1,194,532 $ - $ - $ 1,194,532 Less allowance (59,405 ) - - (59,405 ) Net account receivable $ 1,135,127 $ - $ - $ 1,135,127 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 6. Property and Equipment A rollforward of the Companys property and equipment is as follows: December 31, 2014 Acquisitions Additions Deletions December 31, 2015 Property and equipment $ 2,853,603 $ 1,202,435 $ 605,204 $ (861,915 ) $ 3,799,327 Leasehold improvements 787,188 - 22,766 (88,803 ) 721,151 Software 504,967 1,197,839 112,876 (123,443 ) 1,692,239 Building 85,906 5,034,348 28,449 - 5,148,703 Land 9,500 1,200,000 - - 1,209,500 Other 96,311 - - - 96,311 4,337,475 8,634,622 769,295 (1,074,161 ) 12,667,231 Accumulated depreciation (3,139,765 ) (1,334,555 ) (697,956 ) 1,066,366 (4,105,910 ) $ 1,197,710 $ 7,300,067 $ 71,339 $ (7,795 ) $ 8,561,321 December 31, 2013 Acquisitions Additions Deletions December 31, 2014 Property and equipment $ 1,571,152 $ 1,159,500 $ 159,076 $ (36,125 ) $ 2,853,603 Leasehold improvements 701,764 73,798 43,539 (31,913 ) 787,188 Software 17,322 487,645 - - 504,967 Building 85,906 - - - 85,906 Land 9,500 - - - 9,500 Other 61,765 - 34,546 - 96,311 2,447,409 1,720,943 237,161 (68,038 ) 4,337,475 Accumulated depreciation (1,519,335 ) (1,319,641 ) (368,827 ) 68,038 (3,139,765 ) $ 928,074 $ 401,302 $ (131,666 ) $ - $ 1,197,710 |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | 7. Intangible Assets December 31, 2014 Acquisitions Additions Deletions December 31, 2015 Customer relationships $ 4,924,912 $ 1,148,000 $ - $ - $ 6,072,912 Acquired franchise agreements 5,227,112 - - - 5,227,112 Other - 227,000 - - 227,000 Amortizable Intangible assets 10,152,024 1,375,000 - - 11,527,024 Less accumulated amortization (5,685,523 ) (105,480 ) (499,697 ) - (6,290,700 ) Net Amortizable Intangible Assets 4,466,501 1,269,520 (499,697 ) - 5,236,324 Non-amortizable trademarks 2,782,292 - - - 2,782,292 Intangible Assets, net $ 7,248,793 $ 1,269,520 $ (499,697 ) $ - $ 8,018,616 December 31, 2013 Acquisitions Additions Deletions December 31, 2014 Customer relationships $ 4,627,412 $ 327,000 $ - $ (29,500 ) $ 4,924,912 Acquired franchise agreements - 5,227,112 - - 5,227,112 Other - - - - - Amortizable Intangible assets 4,627,412 5,554,112 - (29,500 ) 10,152,024 Less accumulated amortization (4,510,316 ) (992,950 ) (187,669 ) 5,412 (5,685,523 ) Net Amortizable Intangible Assets 117,096 4,561,162 (187,669 ) (24,088 ) 4,466,501 Non-amortizable trademarks - 2,782,292 - - 2,782,292 Intangible Assets, net $ 117,096 $ 7,343,454 $ (187,669 ) $ (24,088 ) $ 7,248,793 As of December 31, 2015, estimated future amortization expense for the amortizable intangible assets is as follows: 2016 $ 555,778 2017 542,224 2018 530,027 2019 519,048 2020 502,434 Thereafter 2,586,813 $ 5,236,324 |
Deferred Revenue and Other Liab
Deferred Revenue and Other Liabilities | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Revenue and Other Liabilities | 8. Deferred Revenue and Other Liabilities Deferred revenue and other liabilities consisted of the following: For the Year Ended December 31, 2015 2014 Deferred financing fees $ 285,452 $ 284,231 Deferred franchise development fees 264,000 281,837 Merchandise credits and gift card liability 1,127,470 - Other 119,416 72,000 Total $ 1,796,338 $ 638,068 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Leases | 9. Leases The Company leases retail and office facilities under operating leases with terms ranging from month to month to six years, with rights to extend for additional periods. Rent expense, inclusive of base rents and common area maintenance obligations, insurance and real estate tax reimbursements, on all operations was approximately $4,490,000 and $3,003,000 in 2015 and 2014, respectively. Future minimum lease payments (in thousands) are approximately as follows: Year Ending December 31, Operating Leases 2016 $ 3,088 2017 2,141 2018 1,146 2019 670 2020 226 thereafter 7 Total minimum lease payments $ 7,278 |
Notes Payable - Long Term
Notes Payable - Long Term | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Notes Payable - Long Term | 10. Notes Payable Long Term The Companys long-term debt is as follows: December 31, 2015 2014 Note payable (with a credit limit of $3,000,000) to River City Equity, Inc., a related party (see Note 18), with interest payable monthly at 12% due June 30, 2016 and upon certain events can be collateralized by substantially all assets of WCR, excluding any equity interest in AGI $ 3,000,000 $ 2,000,000 Subsidiary note payable to a financial institution with quarterly principal payments of $375,000 plus interest at prime rate plus 2.5% (6% as of December 31, 2015), secured by the AGIs assets, maturing March 2017 1,625,000 3,125,000 Subsidiary note pa yab le to a financial institution with monthly principal payment of $33,334 plus annual paydowns equal to JPREs net cash flow from operations due within 120 days of the calendar year end plus interest at LIBOR plus 3.5% (3.75% at December 31, 2015), secured by JPRE assets, maturing June 5, 2019 when remaining principal balance is due 3,371,460 - Total 7,996,460 5,125,000 Less current maturities (4,900,008 ) (3,500,000 ) $ 3,096,452 $ 1,625,000 Future minimum long-term principal payments are as follows: Year Ending December 31, Amount 2016 $ 4,900,008 2017 525,008 2018 400,008 2019 400,008 2020 400,008 Thereafter 1,371,420 $ 7,996,460 As part of the lending agreements, applicable subsidiaries may draw on respective line of credit (LOC) agreements which cumulatively amount to $7,250,000 of available credit. The LOCs bear interest at rates varying from LIBOR plus 2.75% to the greater of (a) the prime rate plus 2.50% or (b) the LIBOR rate plus 5.50%. There is no amount outstanding under the various LOCs as of December 31, 2015. The Companys subsidiaries notes payable with financial institutions include certain financial covenants. Management has determined that the applicable subsidiaries were in compliance with these financial covenants as of December 31, 2015. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Tax Provision | 11. Income Taxes The Companys provision for income taxes is as follows: For the Year Ended December 31, 2015 2014 Current: Federal $ 1,535,444 $ 1,007,860 State 305,120 181,000 Foreign 30,200 8,000 1,870,764 1,196,860 Deferred: Federal 547,000 293,000 State 64,000 56,000 611,000 349,000 $ 2,481,764 $ 1,545,860 Deferred income tax assets (liabilities) are summarized as follows: For the Year Ended December 31, 2015 2014 Current Non-Current Current Non-Current Deferred income tax assets: Allowance for accounts and loans receivable $ 544,000 $ - $ 521,000 $ - Inventory capitalization 120,000 - - - Inventory reserve 75,000 - - - Prepaid expense (374,000 ) - - - Accrued expenses 198,000 - 123,000 - 563,000 - 644,000 - Deferred income tax liabilities: Property and equipment - (721,000 ) - (306,000 ) Goodwill and intangible assets - (3,864,000 ) - (3,867,000 ) Net operating losses (expires 2031) - 113,000 - 208,000 Capital loss carryforward (expires 2016) - 20,000 - 21,000 Foreign tax credits - 21,000 - 40,000 Valuation allowance - (21,000 ) - (35,000 ) - (4,452,000 ) - (3,939,000 ) Net $ 563,000 $ (4,452,000 ) $ 644,000 $ (3,939,000 ) Reconciliations from the statutory federal income tax rate to the effective income tax rate are as follows: For the Year Ended December 31, 2015 2014 Income tax expense using the statutory federal rate $ 2,047,000 $ 1,345,000 State income taxes, net of federal benefit 213,000 152,000 Transaction expenses 119,000 64,000 Share based compensation 41,000 - Other 61,764 (15,000 ) Income tax expense $ 2,481,764 $ 1,546,000 It is the Companys practice to recognize penalties and/or interest related to income tax matters in interest and penalties expense. As of December 31, 2015 and 2014, the Company had an immaterial amount of accrued interest and penalties. The Company is subject to income taxes in the U.S. federal jurisdiction and various states and local jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. Accounting principles generally accepted in the United States of America require management to evaluate tax positions taken by the Company and recognize a tax liability (or asset) if the company has taken an uncertain position that more likely than not would not be sustained upon examination by the Internal Revenue Service. Management has analyzed the tax positions taken by the Company and has concluded that as of December 31, 2015, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the consolidated financial statements. The Company is subject to routine audits by taxing jurisdictions. Currently the Company has a federal and state of Missouri audit in progress. Management believes the Company is no longer subject to income tax examinations for years prior to 2012. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2015 | |
Stockholders' Equity Note [Abstract] | |
Equity | 11. Equity Capitalization On May 30, 2014, the Companys Board of Directors approved a 1-for-20 reverse stock split. The reverse stock split became effective on June 20, 2014. The accompanying financial statements and notes have been adjusted retroactively to reflect the reverse stock split. As a result of the reverse stock split, the Companys adjusted authorized capital stock consists of 12,500,000 shares of no par value capital stock. All shares have equal voting rights and are entitled to one vote per share. Common Stock Issued As further explained in Note 13, on July 1, 2015, we issued an aggregate 3.5 million shares of common stock for the acquisition of JPPA, RAI and JPRE. This represented approximately 37% of the total issued and outstanding common stock of the Company after the issuance, which totaled 9.497,534 shares. As further explained in Note 13, after the close of business on September 30, 2014 we issued 2,986,823 shares of common stock for the acquisition of AlphaGraphics. This represented approximately 49.8% of the total issued and outstanding common stock of the Company after the issuance, which totaled 5,997,588 shares. WCR 2015 Stock Incentive Plan On February 2, 2008, the Board of Directors of the Company approved and adopted the Companys 2008 Stock Incentive Plan, pursuant to which an aggregated of 100,000 shares of common stock have been reserved for issuance. Effective February 6, 2015, the Board of Directors terminated the earlier adopted 2008 Stock Incentive Plan and adopted the Companys new 2015 Stock Incentive Plan. There were no incentives issued or outstanding under the terminated plan. As of December 31, 2015 65,000 options had been granted under the 2015 plan. The Board of Directors, or a committee of the board, administers the 2015 Stock Incentive Plan and has complete authority to award incentives, to interpret the plan and to make any other determination which it believes necessary and advisable for the proper administration of the plan. A total of 100,000 shares of common stock were reserved in connection with the adoption of the 2015 Stock Incentive Plan. The 2015 Stock Incentive plan permits the granting of incentives in any one or a combination of the following forms: stock options, including options intended to qualify under Section 422 of the Internal Revenue Code of 1986, as amended, as qualified or incentive stock options; stock appreciation rights (often referred to as SARs) payable in shares of common stock; restricted stock and restricted stock units; performance awards of cash, stock or property; and stock awards. The following table summarizes nonvested stock option awards outstanding at September 30, 2015 and the changes for the nine months then ended: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term ( in years Aggregate Intrinsic Value Outstanding and nonvested at December 31, 2014 - $ - $ - Granted 65,000 6.00 9.17 - Vested - - - Forfeited - - - Outstanding and nonvested at December 31, 2015 65,000 $ 6.00 9.17 $ - Exercisable at December 31, 2015 - The option vests in three annual and near-equal installments on each of February 8, 2016, 2017 and 2018, and has a contract life of ten years. There were no vested options at December 31, 2015, and thus no intrinsic value in outstanding vested options at December 31, 2015. As of December 31, 2015, total unrecognized stock-based compensation expense related to nonvested stock options was approximately $89,000, which is expected to be recognized over a weighted-average period of approximately 1.1 years. Noncontrolling Interests The Company owns 99.2% of AGI. For financial interests in which the Company owns a controlling financial interest, the Company applies the provisions of SFAS 160 which are applicable to reporting the equity and net income or loss attributable to noncontrolling interests. |
Other Expenses
Other Expenses | 12 Months Ended |
Dec. 31, 2015 | |
Other Expense [Abstract] | |
Other Expenses | 12. Other Expenses A breakout of other expense is as follows: For the Year Ended December 31, 2015 2014 Bank fees $ 1,079,930 $ 473,632 Collection costs 431,682 449,301 Conference expense 680,991 - Insurance 540,257 305,935 Management and advisory fees 578,082 536,369 Professional and consulting fees 1,911,163 1,048,599 Supplies 694,302 637,730 Other 2,844,765 1,096,389 $ 8,761,172 $ 4,547,955 |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2015 | |
Business Combination, Description [Abstract] | |
Acquisitions | 13. Acquisitions Cellular Retail Growth Effective June 1, 2015, PQH purchased with cash all outstanding membership interests in four separate limited liability companies (Green Communications, LLC, an Arizona LLC, Green Communications, LLC, an Oregon LLC, Green Communications, LLC, a Washington LLC and Go Green, LLC an Arizona LLC). The entities acquired, when combined, do not meet the 20% significant subsidiaries thresholds under Rule 210.1-02 as modified by Rule 210.3-05(b) of SEC Reg. S-X. Under the equity method of accounting, the assets acquired and liabilities assumed were recorded at their estimated fair values as of the purchase date as follows: June 1, 2015 Cash $ 389,000 Inventory 427,000 Other receivables 405,000 Property and equipment 612,000 Goodwill 578,000 Intangible assets 903,000 Other assets 69,000 Accounts payable and accrued liabilities (826,000 ) $ 2,557,000 Direct to Consumer Segment Effective July 1, 2015, the Company acquired a 100% interest in the businesses of RAI, JPPA, and JPRE, by completing a merger and contribution transaction. In consideration for the acquisition of these businesses, the Company issued to the former owners an aggregate of 3.5 million shares of the Companys common stock representing approximately 37% of the total issued and outstanding common stock after consummation of the acquisition. The e ntities are affiliated entities under common control and in accordance with Accounting Standards Codification Topic 805, Business Combinations, and the Company, as the acquirer, recognized the assets and liabilities of the target entities at their historical values as of the date of merger as follows July 1, 2015 Cash $ 2,082,000 Accounts Receivables, net 527,000 Inventory 3,170,000 Deferred income tax asset 186,000 Prepaid expense and other current assets 525,000 Property and equipment, net 6,590,000 Goodwill 31,000 Intangible assets, net 122,000 Accounts payable and accrued liabilities (2,231,000 ) Short-term notes payable (120,000 ) Income taxes payable (547,000 ) Deferred revenue and other (460,000 ) Notes payable and capital leases (3,583,000 ) Deferred income tax liability (169,000 ) $ 6,123,000 Franchise Segment Effective October 1, 2014, we acquired a 99.2% interest in the business of AlphaGraphics, Inc., a Delaware corporation, through a merger transaction governed by an Agreement and Plan of Merger dated August 29, 2014 (the Merger Agreement). As contemplated under the Merger Agreement, we issued an aggregate of 2,986,823 shares of our common stock, representing approximately 49.8% of our total issued and outstanding common stock immediately after the merger, to BC Alpha Holdings I, LLC, a Delaware limited liability company that had earlier owned the AlphaGraphics business. The e ntities are affiliated entities under common control and in accordance with Accounting Standards Codification Topic 805, Business Combinations, and Western Capital, as the acquirer, recognized the assets and liabilities of the AlphaGraphics entities at their historical values as of the date of merger as follows: October 1, 2014 Cash $ 168,000 Receivables 1,227,000 Property and equipment 374,000 Intangible assets 7,016,000 Note receivable 636,000 Other assets 453,000 Accounts payable and accrued liabilities (2,493,000 ) Other liabilities (506,000 ) Note and lease obligations (4,084,000 ) Deferred tax liability (2,434,000 ) 357,000 Noncontrolling interests (7,000 ) $ 350,000 The results of the operations for the acquired business have been included in the consolidated financial statements since the date of the acquisition. The following table presents the unaudited pro forma results of operations for the year ended December 31, 2015 and 2014 (in thousands), as if the acquisitions had been consummated at the beginning of 2014. The pro forma net income below excludes the expense of the transactions. The pro forma results of operations are prepared for comparative purposes only and do not necessarily reflect the results that would have occurred had the acquisition occurred at the beginning of the 2014 or the results which may occur in the future. Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Year Ended December 31, 2015 Pro forma revenue $ 13,025 $ 37,823 $ 42,738 $ 12,699 $ - $ 106,285 % of total pro forma revenue 12.3 % 35.6 % 40.2 % 11.9 % 0.00 % 100.0 % Pro forma net income $ 2,270 $ 1,167 $ 2,177 $ 952 $ (736 ) $ 5,830 Pro forma net income attributable to noncontrolling interests $ 17 $ - $ - $ - $ - $ 17 Pro forma net income attributable to WCR common shareholders $ 2,253 $ 1,167 $ 2,177 $ 952 $ (736 ) $ 5,813 Pro forma earnings per share attributable to WCR common shareholders basic and diluted $ 0.237 $ 0.123 $ 0.229 $ 0.100 $ (0.077 ) $ 0.612 Year Ended December 31, 2014 Pro forma revenue $ 12,215 $ 36,033 $ 43,622 $ 12,877 $ - $ 104,747 % of total pro forma revenue 11.7 % 34.4 % 41.6 % 12.3 % 0.00 % 100.0 % Pro forma net income $ 1,554 $ 930 $ 1,427 $ 1,274 $ - $ 5,185 Pro forma net income attributable to noncontrolling interests $ 13 $ - $ - $ - $ - $ 13 Pro forma net income attributable to WCR common shareholders $ 1,541 $ 930 $ 1,427 $ 1,274 $ - $ 5,172 Pro forma earnings per share attributable to WCR common shareholders basic and diluted $ 0.162 $ 0.098 $ 0.150 $ 0.134 $ - $ 0.544 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | 14. Segment Information The Company has grouped its operations into five segments Franchise, Cellular Retail, Direct to Consumer, Consumer Finance and Corporate. The Direct to Consumer and Corporate segments were added in 2015. The Franchise segment offers franchise Segment information related to the years ended December 31, 2015 and 2014: December 31, 2015 (in thousands) Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Revenue from external customers $ 13,025 $ 32,846 $ 17,884 $ 12,699 $ - $ 76,454 Depreciation and amortization $ 441 $ 430 $ 214 $ 113 $ - $ 1,198 Interest expense $ 202 $ 284 $ 90 $ - $ - $ 576 Income tax expense (benefit) $ 1,373 $ 632 $ 207 $ 574 $ (304 ) $ 2,482 Net income (loss) $ 2,270 $ 1,110 $ 243 $ 952 $ (1,038 ) $ 3,537 Total segment assets $ 10,079 $ 14,180 $ 15,878 $ 15,511 $ 537 $ 56,185 Expenditures for segmented assets $ 113 $ 3,865 $ 304 $ 45 $ 14 $ 4,341 December 31, 2014 (in thousands) Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Revenue from external customers $ 3,177 $ 24,706 $ - $ 12,877 $ - $ 40,760 Depreciation and amortization $ 112 $ 327 $ - $ 117 $ - $ 556 Interest expense $ 63 $ 191 $ - $ 62 $ - $ 316 Income tax expense (benefit) $ 441 $ 385 $ - $ 720 $ - $ 1,546 Net income (loss) $ 690 $ 584 $ - $ 1,137 $ - $ 2,411 Total segment assets $ 10,053 $ 9,777 $ - $ 16,932 $ - $ 36,762 Expenditures for segmented assets $ 16 $ 519 $ - $ 119 $ - $ 654 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 15. Commitments and Contingencies Employment Agreements On April 11, 2013, the Company entered into an Amended and Restated Employment Agreement with its Chief Executive Officer, Mr. John Quandahl, to be effective as of April 1, 2013. The amended and restated agreement has a term of three years and contains other terms and conditions that are identical to those of the original agreement which had expired. Specifically, the amended and restated agreement provides an annual base salary and eligibility for an annual performance-based cash bonus pool for management. The amended and restated agreement also contains customary non-solicitation and non-competition provisions as well as provisions for severance payments upon termination by the Company without cause or upon termination by Mr. Quandahl with good reason. Effective February 9, 2015, the Company entered into a three-year employment agreement with its Chief Investment Officer (CIO). Pursuant to that agreement, the CIO is eligible for a discretionary annual performance-based bonus up to $200,000. In connection with the employment agreement, the Company granted Mr. Donchev a stock option providing him with the ten-year right to purchase up to 65,000 shares of the Companys common stock at an exercise price of $6.00 per share. The option vests in three annual and near-equal installments on each of February 8, 2016, 2017 and 2018. The stock option grant is evidenced by a stock option agreement entered into effective February 9, 2015. The option granted to Mr. Donchev was issued under the Companys new 2015 Stock Incentive Plan approved by the Board of Directors effective February 6, 2015. The Company has also entered into several employment agreements with certain members of subsidiary management. The terms of each agreement are different. However, one or all of these agreements include stipulated base salary and bonus potential. The agreement also contains customary non-solicitation and non-competition provisions as well as provisions for severance payments upon termination by the Company without cause. Pursuant to the numerous employment agreements, bonuses of approximately $1,008,000 and $352,000 were accrued for the years ended December 31, 2015 and 2014, respectively. Asset Purchase Agreement On November 10, 2015, the PQH entered into an asset purchase agreement to acquire 10 additional Cricket retail stores for a cost of approximately $456,000. The acquisition of the Cricket locations and payment of the purchase price, net of a deposit paid in 2015, is expected to be completed January 2, 2016. Vendor Service Agreement In September 2015, AGI entered into a service agreement with a vendor for approximately $680,000. The vendor will provide services over a three year period. Legal Proceedings The Company is party to a variety of legal actions arising out of the normal course of business. Plaintiffs occasionally seek punitive or exemplary damages. The Company does not believe that such normal and routine litigation will have a material impact on its consolidated financial results. At the time of the Companys acquisition of AlphaGraphics, that subsidiary was party to litigation with an individual (plaintiff) who was the former CEO, member of its Board of Directors and franchisee owning two AlphaGraphics franchises. In November 2014, AlphaGraphics and the plaintiff entered into a settlement agreement pursuant to which the parties fully released each other and AlphaGraphics was paid a sum of $636,000 in settlement of certain other obligations that had been owed to it by the plaintiff. |
Management and Advisory Agreeme
Management and Advisory Agreement | 12 Months Ended |
Dec. 31, 2015 | |
Management And Advisory Agreement | |
Management and Advisory Agreement | 16. Management and Advisory Agreement The Company is party to an Amended and Restated Management and Advisory Agreement with Blackstreet Capital Management, LLC, (Blackstreet) under which Blackstreet provides certain financial, managerial, strategic and operating advice and assistance to the Company. The amended and restated agreement requires the Company to pay Blackstreet a fee in an amount equal to $400,000 upon the closing of an acquisition in consideration for Blackstreets referral to the Company of such acquisition opportunity, and Blackstreets assistance in the performance of due diligence services relating thereto. Any fees which may have been payable per these terms related to the AGI, JPPA, RAI and JPRE acquisitions (see Note 13) were waived by Blackstreet. Effective July 1, 2015 the agreement with Blackstreet was amended. The annual fees under the amended and restated contract will be the greater of (i) $612,100 (subject to annual increases of five percent) or (ii) five percent of Western Capitals EBITDA as defined under the agreement. All other terms and provisions remain unmodified. Finally, the amended and restated agreement provides that a termination fee will be paid to Blackstreet in the event that the Company terminates the agreement in connection with a sale of all or substantially all of the assets of the Company to, or any merger or other transaction with, an unaffiliated entity, which transaction results in the holders of a majority of the stock of the Company immediately prior to such transaction owning less than 50% of the stock of the Company (or any successor entity) after giving effect to the transaction. The annual management and advisory fees related to the Amended and Restated Management and Advisory Agreement with Blackstreet for the years ended December 31, 2015 and 2014 were $478,082 and $416,369, respectively. |
Special Committee of the Board
Special Committee of the Board of Directors | 12 Months Ended |
Dec. 31, 2015 | |
Special Committee Of Board Of Directors | |
Special Committee of the Board of Directors | 17. Special Committee of the Board of Directors The Board of Directors has appointed Mr. Ellery Roberts to various special committees of the board. Annual Director and special committee fees expense was $50,000 for the years ended December 31, 2015 and 2014. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 18. Related Party Transactions Leases The Company leases three properties from an officer of the Company and another party under operating leases, one that extends through October 2016, requiring monthly lease payments of $1,680, one that in month-to-month, requiring monthly lease payments of $1,200, and one that extends through November 2017, requiring monthly lease payments of $5,000. In October 2012, the Company entered into the latter lease. The lease is for a term of five years and has monthly base rental payments of $5,000 per month. The lease is at terms substantially similar to other leases for property near that location. The lease transaction was approved by the Board of Directors and the related party abstained from voting. This property is used for a Cricket retail storefront. On August 31 2011, the Company entered into two operating leases for property owned by Ladary, Inc. Ladary, which acquired the two properties in foreclosure sales, is a corporation partially owned by the Chief Executive Officer of the Company, three current or past directors and one employee of the management company that manages the Companys largest shareholder. The new leases, one of which replaced an earlier lease that the Company had entered into with the prior landlord, have four-year terms, require aggregate monthly rental payments of $6,000, and are on terms and conditions substantially similar to those contained in the replaced leases. Annual rent expense to related parties for the five retail locations for 2015 and 2014 was approximately $171,000 and $166,500, respectively. Credit Facility On December 7, 2012 (and later amended on March 21, 2014, September 30, 2014 and May 21, 2015), we entered in a borrowing arrangement with River City Equity, Inc. Under this arrangement, as amended, we may borrow up to $3.0 million at an interest rate of 12% per annum, with interest payable on a monthly basis. The note contains no prepayment penalties, and pursuant to the May 21, 2015 amendment, matures on June 30, 2016. The note, under certain circumstances, permits River City Equity to obtain a security interest in substantially all of our assets. As of December 31, 2015, $3.0 million was due and owing under this borrowing agreement. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 19. Subsequent Events Cellular Retail Store Purchase On January 2, 2016, PQH acquired Cricket retail store locations for approximately $456,000. Pending Reincorporation On January 20, 2016, our shareholders approved a plan to reincorporate Western Capital Resources, Inc. in Delaware at a special meeting of the shareholders called for that purpose. Presently, we expect to consummate the reincorporation in April 2016. |
Basis of Presentation, Nature27
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation / Nature of Business | Basis of Presentation / Nature of Business Western Capital Resources, Inc. (WCR) is a parent company owning operating subsidiaries, with percentage owned shown parenthetically, as summarized below. · Franchise o AlphaGraphics, Inc. (AGI) (99.2% Acquired October 1, 2014) franchisor of 254 domestic and 25 international AlphaGraphics Business Centers which specialize in the planning, production, and management of visual communications for businesses and individuals throughout the world. · Cellular Retail o PQH Wireless, Inc. (PQH) (100%) owns and operates cellular retail stores (99 as of December 31, 2015), as an exclusive dealer of the Cricket brand. · Direct to Consumer o J & P Park Acquisitions, Inc. (JPPA) (100% Acquired July 1, 2015) an online and direct marketing distribution retailer of live plants, seeds, holiday gifts and garden accessories selling its products under Park Seed, Jackson & Perkins, and Wayside Gardens brand names as well as a wholesaler under the Park Wholesale brand. o Restorers Acquisition, Inc. (RAI) (100% Acquired July 1, 2015) an online and direct marketing distribution retailer of home improvement and restoration products operating under Van Dykes Restorers. o J & P Real Estate, LLC (JPRE) (100% Acquired July 1, 2015) owns real estate utilized as JPPAs distribution and warehouse facility and the corporate offices of JPPA and RAI. · Consumer Finance o Wyoming Financial Lenders, Inc. (WFL) (100%) owns and operates payday stores (46 as of December 31, 2015) in eight states (Colorado, Iowa, Kansas, Nebraska, North Dakota, South Dakota, Wisconsin and Wyoming) providing sub-prime short-term uncollateralized non-recourse cash advance or payday loans typically ranging from $100 to $500 with a maturity of generally two to four weeks, sub-prime short-term uncollateralized non-recourse installment loans typically ranging from $300 to $800 with a maturity of six months, check cashing and other money services to individuals. o Express Pawn, Inc. (EPI) (100%) owns and operates retail pawn stores (three as of December 31, 2015) in Nebraska and Iowa providing collateralized non-recourse pawn loans and retail sales of merchandise obtained from forfeited pawn loans or purchased from customers. References in these financial statement notes to Company or we refer to Western Capital Resources, Inc. and its subsidiaries. References to specific companies within our enterprise, such AGI, PQH, JPPA, RAI, JPRE, WFL or EPI are references only to those companies. |
Basis of Consolidation | Basis of Consolidation The consolidated financial statements include the accounts of the WCR, its wholly owned subsidiaries and other entities in which the Company owns a controlling financial interest. For financial interests in which the Company owns a controlling financial interest, the Company applies the provisions of ASC 810 applicable to reporting the equity and net income or loss attributable to noncontrolling interests. All significant intercompany balances and transactions of the Company have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect certain reported amounts and disclosures in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant management estimates relate to the notes and loans receivable allowance, carrying value and impairment of long-lived goodwill and intangible assets, inventory valuation and obsolescence, estimated useful lives of property and equipment, gift certificate liability and deferred taxes and tax uncertainties. |
Revenue Recognition | Revenue Recognition Franchise Royalty revenues from franchisees are primarily based on a percentage of business center sales and are recognized in the period in which they are earned. Initial franchise fee revenues are recognized when the obligations required by the franchise agreement have been substantially performed by AGI, which is generally upon the training of the franchisee. Revenues from area development franchise fees and International Master License Agreement (IML) fees are recognized when the obligations required by the area development and IML agreements have been substantially performed. Supply sales, service fees and other revenues are recognized when products have been shipped or services provided. Cellular Retail Sales revenue for sales of phones and accessories and dealer compensation for related activations is recognized in the period in which the sale is completed (retail sales and associated fees). Customer service fees are recognized upon completion of the service and payment received. Other dealer compensation not attributed to phone activations is recorded in the period earned as reported to us by Cricket Wireless. All sales are presented net of sales taxes, which are excluded from revenue. Direct to Consumer Sales revenue is recognized in the period in which product is shipped. Sales billed or cash received in advance of actual shipment are deferred and recorded as income in the period in which shipment is made. Shipping and handling fees billed to customers is included in net sales. Shipping and handling costs are expensed as incurred and included in cost of sales. All sales are presented net of sales taxes, which are excluded from revenue. Consumer Finance Loan fees and interest on cash advance loans are recognized on a constant-yield basis ratably over a loans term. Title and installment loan fees and interest are recognized using the interest method, except that installment loan origination fees are recognized as they become non-refundable and installment loan maintenance fees are recognized when earned. The Company recognizes fees on pawn loans on a constant-yield basis ratably over the loans terms. No fees are recognized on forfeited pawn loans. |
Receivables and Loss Allowance | Receivables and Loss Allowance Franchise Accounts receivable are recorded for earned but uncollected royalties and other related franchise fees. Allowances are provided on an account-by-account basis for estimated uncollectible accounts as deemed necessary by management. The Company considers current economic trends and changes in payment terms when evaluating the adequacy of the allowance. Direct to Consumer Receivables, for noncash sales, are recorded when orders are shipped and represent claims against third parties that will be settled in cash. The carrying value of receivables, net of the allowance for doubtful accounts, represents their estimated net realizable value. The allowance for doubtful accounts is estimated based on historical collection trends, type of customer, the age of outstanding receivables and existing economic conditions. If events or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. Past due receivable balances are written-off when internal collection efforts have been unsuccessful in collecting the amount due. Consumer Finance Included in loans receivable are unpaid principal, interest and fee balances of payday, installment, pawn and title loans that have not reached their maturity date, and late payday loans that have reached maturity within the last 180 days and have remaining outstanding balances. Late payday loans generally are unpaid loans where a customers personal check has been deposited and the check has been returned due to non-sufficient funds in the customers account, a closed account, or other reasons. All returned items are charged-off after 180 days, as collections after that date have not been significant. Loans are carried at cost plus accrued interest or fees less payments made and a loans receivable allowance. The Company does not specifically reserve for any individual payday, installment or title loan. The Company aggregates loan types for purposes of estimating the loss allowance using a methodology that analyzes historical portfolio statistics and managements judgment regarding recent trends noted in the portfolio. This methodology takes into account several factors, including (1) the amount of loan principal, interest and fee outstanding, (2) historical charge offs from loans that originated during the last 24 months, (3) current and expected collection patterns and (4) current economic trends. The Company utilizes a software program to assist with the tracking of its historical portfolio statistics. A loan loss allowance is maintained for anticipated losses for payday and installment loans based primarily on our historical percentages by loan type of net charge offs, applied against the applicable balance of loan principal, interest and fees outstanding. The Company also periodically performs a look-back analysis on its loan loss allowance to verify the historical allowance established tracks with the actual subsequent loan write-offs and recoveries. The Company is aware that as conditions change, it may also need to make additional allowances in future periods. Loan losses or charge-offs of pawn or title loans are not recorded because the value of the collateral exceeds the loan amount. |
Inventory | Inventory Cellular Retail Inventory, consisting of phones and accessories, is stated at cost, determined on the specific identification and a first-in, first-out basis, respectively. Direct to Consumer Inventory is valued at the lower of cost or market using the weighted-average method of determining cost. Consumer Finance Merchandise inventory is stated at the lower of cost or market. The principal amount of an unpaid loan becomes the inventory cost for forfeited collateral. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost less accumulated depreciation. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets as follows: · Computer equipment and software 3 10 years · Improvements and equipment 3 15 years · Building 39 years The cost of maintenance and repairs is charged to operations as incurred while renewals and betterments are capitalized. The Company capitalizes certain internal costs, including payroll costs, incurred in connection with the development of software for internal use. These costs are capitalized beginning when the Company has entered the application development stage. The capitalization of these costs ceases when the software is substantially complete and ready for its intended use. Costs incurred for enhancements that are expected to result in additional features or functionality are capitalized and expensed over the estimated useful life of the enhancements. |
Goodwill | Goodwill Goodwill represents the excess of cost over the fair value of net assets acquired using purchase accounting and is not amortized. |
Intangible Assets | Intangible Assets Intangible assets represent the fair values management assigned to assets acquired through business acquisitions and is amortized over periods of three to 15 years based on managements estimates of the useful life of the asset. |
Long-Lived Assets | Long-Lived Assets The Company assesses the possibility of impairment of long-lived and intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant underperformance relative to expected historical or projected future cash flows, significant changes in the manner of use of acquired assets or the strategy for the overall business, and significant negative industry events or trends. In addition, the Company conducts an annual goodwill impairment test as of October 1 each year. The Company assesses goodwill for impairment at the reporting unit level by applying a fair value test. This fair value test involves a two-step process. The first step is to compare the carrying value of our net assets to our fair value. If the fair value is determined to be less than the carrying value, a second step is performed to measure the amount of the impairment, if any. Due to the minimal amount of public float for the Companys common stock, the market capitalization approach of valuing the reporting unit as a whole is not practical. The discounted future cash flows method is utilized in estimating value. When estimated future cash flows are less than the carrying value of the net assets and related goodwill, an impairment test is performed to measure and recognize the amount of the impairment loss, if any. There were no impairment charges recorded in 2015 or 2014. |
Merchandise Credits and Gift Card Liabilities | Merchandise Credits and Gift Card Liabilities Direct to Consumer The Company maintains a liability for unredeemed gift cards, gift certificates and merchandise credits until the earlier of redemption, escheatment or a maximum of two years. The Company has concluded based on historical redemption trends that the likelihood of these liabilities being redeemed beyond two years from the date of issuance is remote. |
Advertising, Marketing and Development Costs | Advertising, Marketing and Development Costs Franchise The costs of advertising, marketing and development are expenses as incurred. Certain amounts received from franchisees for marketing and advertising campaigns benefiting the franchisees are held in the AlphaGraphics Integrated Marketing Fund. AGI controls the manner in which these funds are spent. In addition to advertising, marketing and development expenses, fund expenses include general operating expenses such as reasonable salaries, travel related expenditures, administrative expenses, and overhead incurred by AGI on behalf of the fund. Amounts in the fund and the related revenues and expenses are not reflected in the accompanying consolidated financial statements. AGI may direct that the amount spent in any fiscal year is greater or less than the aggregate contributions made by the franchisees into the fund. Direct to Consumer The Company expenses advertising costs as they are incurred, except for direct-response advertising, which is capitalized and amortized over its expected period of future benefits, not to exceed six months. Direct-response advertising consists primarily of catalog book production, printing, and postage costs. Prepaid advertising costs at December 31, 2015 were $0.92 million. Consumer Finance The costs of advertising and marketing are expenses as incurred. |
Stock-based Compensation | Stock-based Compensation The Company accounts for its employee stock-based compensation plans using the fair value method. The fair value method requires the Company to estimate the grant-date fair value of its stock-based awards and amortize this fair value to compensation expense over the requisite service period or vesting term. The Company uses the Black-Scholes option-pricing model to estimate the fair value of the Companys stock option awards. The determination of the fair value of stock-based payment awards on the date of grant using an option-pricing model is affected by the Companys stock price as well as assumptions regarding a number of complex and subjective variables. These variables include the expected stock price volatility over the term of the awards, actual and projected employee stock option exercise behaviors, the risk-free interest rate and expected dividends. Due to the inherent limitations of option-valuation models, future events that are unpredictable and the estimation process utilized in determining the valuation of the stock-based awards, the ultimate value realized by award holders may vary significantly from the amounts expensed in the Companys financial statements. Stock-based compensation expense is recognized net of estimated forfeitures such that expense is recognized only for those stock-based awards that are expected to vest. A forfeiture rate is estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from initial estimate. |
Income Taxes | Income Taxes Deferred income taxes reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts, based on enacted tax laws and statutory tax rates applicable in the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. The provision for income taxes represents taxes paid or payable for the current year and changes during the year in deferred tax assets and liabilities. |
Net Income Per Common Share | Net Income Per Common Share Basic net income per common share is computed by dividing the income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share gives effect to all potentially dilutive common shares outstanding during the period, including stock options, using the treasury stock method. Options to purchase 65,000 shares granted under the 2015 Stock Incentive Plan effective February 6, 2015 (see Note 11) were outstanding at December 31, 2015. These options have a strike price in excess of the market price as of December 31, 2015, were antidilutive and therefore not included in the computation of diluted earnings per share. Thus, there were no dilutive common shares as of December 31, 2015 and 2014. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The amounts reported in the balance sheets for cash, accounts and loans receivable, inventory, and accounts payable are short-term in nature and their carrying values approximate fair values. The amounts reported in the balance sheets for notes payable are both long-term and short-term and their carrying value approximates fair value. |
Reclassifications | Reclassifications Certain Statement of Income reclassifications have been made in the presentation of our prior financial statements and accompanying notes to conform to the presentation as of and for the year ended December 31, 2015. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) jointly issued a comprehensive new revenue recognition standard that will supersede nearly all existing revenue recognition guidance under US GAAP and IFRS. This converged standard is effective for annual and interim periods beginning after December 15, 2016. The Company is currently assessing the potential effects on our financial condition and results of operations and consolidated financial statements. In November 2014 the FASB issued ASU 2015-17, Income Taxes (Topic 740) Related to the Balance Sheet Classification of Deferred Taxes which will require entities to present deferred tax assets (DTAs) and deferred tax liabilities (DTLs) as noncurrent in a classified balance sheet. The ASU simplifies the current guidance (ASC 740-10-45-4), which requires entities to separately present DTAs and DTLs as current and noncurrent in a classified balance sheet. The ASU is effective for annual reporting periods beginning on or after December 15, 2016, and interim periods within those annual periods, with early application permitted. The Company is currently assessing the potential effects on our consolidated financial position. No other new accounting pronouncements issued or effective during the fiscal year have had or are expected to have a material impact on the consolidated financial statements. |
Basis of Presentation, Nature28
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of property and equipment estimated useful lives | Property and equipment are recorded at cost less accumulated depreciation. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets as follows: Computer equipment and software 3 10 years Improvements and equipment 3 15 years Building 39 years |
Risks Inherent in the Operati29
Risks Inherent in the Operating Environment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Risks and Uncertainties [Abstract] | |
Schedule of geographic economic and regulatory risk concentrations | For the years ended December 31, 2015 and 2014, the Consumer Finance segment had geographic economic and regulatory risk concentrations (shown as a percentage of applicable segments revenue by state when 10% or more) as follows: Consumer Finance Segment 2015 % of Revenues 2014 % of Revenues Nebraska 33 % 30 % North Dakota 19 % 18 % Wyoming 14 % 14 % Iowa 14 % 14 % |
Loans Receivable (Table)
Loans Receivable (Table) | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Schedule of outstanding loans receivable aging | At December 31, 2015 and December 31, 2014, the Companys outstanding loans receivable aging was as follows: December 31, 2015 Payday Installment Pawn & Title Total Current $ 4,065,706 $ 291,947 $ 286,514 $ 4,644,167 1-30 332,217 43,179 - 375,396 31-60 263,486 24,233 - 287,719 61-90 199,526 16,293 - 215,819 91-120 196,123 9,417 - 205,540 121-150 160,386 4,985 - 165,371 151-180 165,237 2,189 - 167,426 5,382,681 392,243 286,514 6,061,438 Less Allowance (1,081,000 ) (96,000 ) - (1,177,000 ) $ 4,301,681 $ 296,243 $ 286,514 $ 4,884,438 December 31, 2014 Payday Installment Pawn & Total Current $ 4,387,393 $ 321,634 $ 372,805 $ 5,081,832 1-30 305,382 47,321 - 352,703 31-60 223,465 24,791 - 248,256 61-90 236,072 11,799 - 247,871 91-120 206,705 5,438 - 212,143 121-150 200,101 1,984 - 202,085 151-180 204,804 572 - 205,376 5,763,922 413,539 372,805 6,550,266 Less Allowance (1,147,000 ) (72,000 ) - (1,219,000 ) $ 4,616,922 $ 341,539 $ 372,805 $ 5,331,266 |
Loans Receivable Allowance (Tab
Loans Receivable Allowance (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Provision for Loan and Lease Losses [Abstract] | |
Schedule of loans receivable allowance | A rollforward of the Companys loans receivable allowance for the years ended December 31, 2015 and 2014 is as follows: Year Ended December 31, 2015 2014 Loans receivable allowance, beginning of period $ 1,219,000 $ 1,215,000 Provision for loan losses charged to expense 1,904,893 1,817,822 Charge-offs, net (1,946,893 ) (1,813,822 ) Loans receivable allowance, end of period $ 1,177,000 $ 1,219,000 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Schedule of accounts receivables | A breakdown of accounts receivables by segment as of December 31, 2015 and 2014 are as follows: December 31, 2015 Franchise Cellular Direct to Total Accounts receivable $ 1,332,446 $ 148,346 $ 754,400 $ 2,235,192 Less allowance (183,000 ) - (89,000 ) (272,000 ) Net account receivable $ 1,149,446 $ 148,346 $ 665,400 $ 1,963,192 December 31, 2014 Franchise Cellular Direct to Total Accounts receivable $ 1,194,532 $ - $ - $ 1,194,532 Less allowance (59,405 ) - - (59,405 ) Net account receivable $ 1,135,127 $ - $ - $ 1,135,127 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | rollforward of the Companys property and equipment is as follows: December 31, 2014 Acquisitions Additions Deletions December 31, 2015 Property and equipment $ 2,853,603 $ 1,202,435 $ 605,204 $ (861,915 ) $ 3,799,327 Leasehold improvements 787,188 - 22,766 (88,803 ) 721,151 Software 504,967 1,197,839 112,876 (123,443 ) 1,692,239 Building 85,906 5,034,348 28,449 - 5,148,703 Land 9,500 1,200,000 - - 1,209,500 Other 96,311 - - - 96,311 4,337,475 8,634,622 769,295 (1,074,161 ) 12,667,231 Accumulated depreciation (3,139,765 ) (1,334,555 ) (697,956 ) 1,066,366 (4,105,910 ) $ 1,197,710 $ 7,300,067 $ 71,339 $ (7,795 ) $ 8,561,321 December 31, 2013 Acquisitions Additions Deletions December 31, 2014 Property and equipment $ 1,571,152 $ 1,159,500 $ 159,076 $ (36,125 ) $ 2,853,603 Leasehold improvements 701,764 73,798 43,539 (31,913 ) 787,188 Software 17,322 487,645 - - 504,967 Building 85,906 - - - 85,906 Land 9,500 - - - 9,500 Other 61,765 - 34,546 - 96,311 2,447,409 1,720,943 237,161 (68,038 ) 4,337,475 Accumulated depreciation (1,519,335 ) (1,319,641 ) (368,827 ) 68,038 (3,139,765 ) $ 928,074 $ 401,302 $ (131,666 ) $ - $ 1,197,710 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | December 31, 2014 Acquisitions Additions Deletions December 31, 2015 Customer relationships $ 4,924,912 $ 1,148,000 $ - $ - $ 6,072,912 Acquired franchise agreements 5,227,112 - - - 5,227,112 Other - 227,000 - - 227,000 Amortizable Intangible assets 10,152,024 1,375,000 - - 11,527,024 Less accumulated amortization (5,685,523 ) (105,480 ) (499,697 ) - (6,290,700 ) Net Amortizable Intangible Assets 4,466,501 1,269,520 (499,697 ) - 5,236,324 Non-amortizable trademarks 2,782,292 - - - 2,782,292 Intangible Assets, net $ 7,248,793 $ 1,269,520 $ (499,697 ) $ - $ 8,018,616 December 31, 2013 Acquisitions Additions Deletions December 31, 2014 Customer relationships $ 4,627,412 $ 327,000 $ - $ (29,500 ) $ 4,924,912 Acquired franchise agreements - 5,227,112 - - 5,227,112 Other - - - - - Amortizable Intangible assets 4,627,412 5,554,112 - (29,500 ) 10,152,024 Less accumulated amortization (4,510,316 ) (992,950 ) (187,669 ) 5,412 (5,685,523 ) Net Amortizable Intangible Assets 117,096 4,561,162 (187,669 ) (24,088 ) 4,466,501 Non-amortizable trademarks - 2,782,292 - - 2,782,292 Intangible Assets, net $ 117,096 $ 7,343,454 $ (187,669 ) $ (24,088 ) $ 7,248,793 |
Schedule of estimated future amortization expense | As of December 31, 2015, estimated future amortization expense for the amortizable intangible assets is as follows: 2016 $ 555,778 2017 542,224 2018 530,027 2019 519,048 2020 502,434 Thereafter 2,586,813 $ 5,236,324 |
Deferred Revenue and Other Li35
Deferred Revenue and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Schedule of deferred revenue and other liabilities | Deferred revenue and other liabilities consisted of the following: For the Year Ended December 31, 2015 2014 Deferred financing fees $ 285,452 $ 284,231 Deferred franchise development fees 264,000 281,837 Merchandise credits and gift card liability 1,127,470 - Other 119,416 72,000 Total $ 1,796,338 $ 638,068 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Schedule of future minimum base lease payments | Future minimum lease payments (in thousands) are approximately as follows: Year Ending December 31, Operating Leases 2016 $ 3,088 2017 2,141 2018 1,146 2019 670 2020 226 thereafter 7 Total minimum lease payments $ 7,278 |
Notes Payable - Long Term (Tabl
Notes Payable - Long Term (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | The Companys long-term debt is as follows: December 31, 2015 2014 Note payable (with a credit limit of $3,000,000) to River City Equity, Inc., a related party (see Note 18), with interest payable monthly at 12% due June 30, 2016 and upon certain events can be collateralized by substantially all assets of WCR, excluding any equity interest in AGI $ 3,000,000 $ 2,000,000 Subsidiary note payable to a financial institution with quarterly principal payments of $375,000 plus interest at prime rate plus 2.5% (6% as of December 31, 2015), secured by the AGIs assets, maturing March 2017 1,625,000 3,125,000 Subsidiary note pa yab le to a financial institution with monthly principal payment of $33,334 plus annual paydowns equal to JPREs net cash flow from operations due within 120 days of the calendar year end plus interest at LIBOR plus 3.5% (3.75% at December 31, 2015), secured by JPRE assets, maturing June 5, 2019 when remaining principal balance is due 3,371,460 - Total 7,996,460 5,125,000 Less current maturities (4,900,008 ) (3,500,000 ) $ 3,096,452 $ 1,625,000 |
Schedule of future minimum long-term principal payments | Future minimum long-term principal payments are as follows: Year Ending December 31, Amount 2016 $ 4,900,008 2017 525,008 2018 400,008 2019 400,008 2020 400,008 Thereafter 1,371,420 $ 7,996,460 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of provision for income taxes | The Companys provision for income taxes is as follows: For the Year Ended December 31, 2015 2014 Current: Federal $ 1,535,444 $ 1,007,860 State 305,120 181,000 Foreign 30,200 8,000 1,870,764 1,196,860 Deferred: Federal 547,000 293,000 State 64,000 56,000 611,000 349,000 $ 2,481,764 $ 1,545,860 |
Schedule of deferred income tax assets (liabilities) | Deferred income tax assets (liabilities) are summarized as follows: For the Year Ended December 31, 2015 2014 Current Non-Current Current Non-Current Deferred income tax assets: Allowance for accounts and loans receivable $ 544,000 $ - $ 521,000 $ - Inventory capitalization 120,000 - - - Inventory reserve 75,000 - - - Prepaid expense (374,000 ) - - - Accrued expenses 198,000 - 123,000 - 563,000 - 644,000 - Deferred income tax liabilities: Property and equipment - (721,000 ) - (306,000 ) Goodwill and intangible assets - (3,864,000 ) - (3,867,000 ) Net operating losses (expires 2031) - 113,000 - 208,000 Capital loss carryforward (expires 2016) - 20,000 - 21,000 Foreign tax credits - 21,000 - 40,000 Valuation allowance - (21,000 ) - (35,000 ) - (4,452,000 ) - (3,939,000 ) Net $ 563,000 $ (4,452,000 ) $ 644,000 $ (3,939,000 ) |
Schedule of effective income tax rate | Reconciliations from the statutory federal income tax rate to the effective income tax rate are as follows: For the Year Ended December 31, 2015 2014 Income tax expense using the statutory federal rate $ 2,047,000 $ 1,345,000 State income taxes, net of federal benefit 213,000 152,000 Transaction expenses 119,000 64,000 Share based compensation 41,000 - Other 61,764 (15,000 ) Income tax expense $ 2,481,764 $ 1,546,000 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Stockholders' Equity Note [Abstract] | |
Schedule of nonnvested stock option awards outstanding | The following table summarizes nonvested stock option awards outstanding at September 30, 2015 and the changes for the nine months then ended: Number of Shares Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term ( in years Aggregate Intrinsic Value Outstanding and nonvested at December 31, 2014 - $ - $ - Granted 65,000 6.00 9.17 - Vested - - - Forfeited - - - Outstanding and nonvested at December 31, 2015 65,000 $ 6.00 9.17 $ - Exercisable at December 31, 2015 - |
Other Expenses (Tables)
Other Expenses (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Expense [Abstract] | |
Schedule of other expense | A breakout of other expense is as follows: For the Year Ended December 31, 2015 2014 Bank fees $ 1,079,930 $ 473,632 Collection costs 431,682 449,301 Conference expense 680,991 - Insurance 540,257 305,935 Management and advisory fees 578,082 536,369 Professional and consulting fees 1,911,163 1,048,599 Supplies 694,302 637,730 Other 2,844,765 1,096,389 $ 8,761,172 $ 4,547,955 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combination, Description [Abstract] | |
Schedule of purchase price allocations | Under the equity method of accounting, the assets acquired and liabilities assumed were recorded at their estimated fair values as of the purchase date as follows: June 1, 2015 Cash $ 389,000 Inventory 427,000 Other receivables 405,000 Property and equipment 612,000 Goodwill 578,000 Intangible assets 903,000 Other assets 69,000 Accounts payable and accrued liabilities (826,000 ) $ 2,557,000 The e ntities are affiliated entities under common control and in accordance with Accounting Standards Codification Topic 805, Business Combinations, and the Company, as the acquirer, recognized the assets and liabilities of the target entities at their historical values as of the date of merger as follows July 1, 2015 Cash $ 2,082,000 Accounts Receivables, net 527,000 Inventory 3,170,000 Deferred income tax asset 186,000 Prepaid expense and other current assets 525,000 Property and equipment, net 6,590,000 Goodwill 31,000 Intangible assets, net 122,000 Accounts payable and accrued liabilities (2,231,000 ) Short-term notes payable (120,000 ) Income taxes payable (547,000 ) Deferred revenue and other (460,000 ) Notes payable and capital leases (3,583,000 ) Deferred income tax liability (169,000 ) $ 6,123,000 The e ntities are affiliated entities under common control and in accordance with Accounting Standards Codification Topic 805, Business Combinations, and Western Capital, as the acquirer, recognized the assets and liabilities of the AlphaGraphics entities at their historical values as of the date of merger as follows: October 1, 2014 Cash $ 168,000 Receivables 1,227,000 Property and equipment 374,000 Intangible assets 7,016,000 Note receivable 636,000 Other assets 453,000 Accounts payable and accrued liabilities (2,493,000 ) Other liabilities (506,000 ) Note and lease obligations (4,084,000 ) Deferred tax liability (2,434,000 ) 357,000 Noncontrolling interests (7,000 ) $ 350,000 |
Schedule of business acquisition, pro forma | The pro forma results of operations are prepared for comparative purposes only and do not necessarily reflect the results that would have occurred had the acquisition occurred at the beginning of the 2014 or the results which may occur in the future. Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Year Ended December 31, 2015 Pro forma revenue $ 13,025 $ 37,823 $ 42,738 $ 12,699 $ - $ 106,285 % of total pro forma revenue 12.3 % 35.6 % 40.2 % 11.9 % 0.00 % 100.0 % Pro forma net income $ 2,270 $ 1,167 $ 2,177 $ 952 $ (736 ) $ 5,830 Pro forma net income attributable to noncontrolling interests $ 17 $ - $ - $ - $ - $ 17 Pro forma net income attributable to WCR common shareholders $ 2,253 $ 1,167 $ 2,177 $ 952 $ (736 ) $ 5,813 Pro forma earnings per share attributable to WCR common shareholders basic and diluted $ 0.237 $ 0.123 $ 0.229 $ 0.100 $ (0.077 ) $ 0.612 Year Ended December 31, 2014 Pro forma revenue $ 12,215 $ 36,033 $ 43,622 $ 12,877 $ - $ 104,747 % of total pro forma revenue 11.7 % 34.4 % 41.6 % 12.3 % 0.00 % 100.0 % Pro forma net income $ 1,554 $ 930 $ 1,427 $ 1,274 $ - $ 5,185 Pro forma net income attributable to noncontrolling interests $ 13 $ - $ - $ - $ - $ 13 Pro forma net income attributable to WCR common shareholders $ 1,541 $ 930 $ 1,427 $ 1,274 $ - $ 5,172 Pro forma earnings per share attributable to WCR common shareholders basic and diluted $ 0.162 $ 0.098 $ 0.150 $ 0.134 $ - $ 0.544 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Schedule of segment information | Segment information related to the years ended December 31, 2015 and 2014: December 31, 2015 (in thousands) Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Revenue from external customers $ 13,025 $ 32,846 $ 17,884 $ 12,699 $ - $ 76,454 Depreciation and amortization $ 441 $ 430 $ 214 $ 113 $ - $ 1,198 Interest expense $ 202 $ 284 $ 90 $ - $ - $ 576 Income tax expense (benefit) $ 1,373 $ 632 $ 207 $ 574 $ (304 ) $ 2,482 Net income (loss) $ 2,270 $ 1,110 $ 243 $ 952 $ (1,038 ) $ 3,537 Total segment assets $ 10,079 $ 14,180 $ 15,878 $ 15,511 $ 537 $ 56,185 Expenditures for segmented assets $ 113 $ 3,865 $ 304 $ 45 $ 14 $ 4,341 December 31, 2014 (in thousands) Franchise Cellular Retail Direct to Consumer Consumer Finance Corporate Total Revenue from external customers $ 3,177 $ 24,706 $ - $ 12,877 $ - $ 40,760 Depreciation and amortization $ 112 $ 327 $ - $ 117 $ - $ 556 Interest expense $ 63 $ 191 $ - $ 62 $ - $ 316 Income tax expense (benefit) $ 441 $ 385 $ - $ 720 $ - $ 1,546 Net income (loss) $ 690 $ 584 $ - $ 1,137 $ - $ 2,411 Total segment assets $ 10,053 $ 9,777 $ - $ 16,932 $ - $ 36,762 Expenditures for segmented assets $ 16 $ 519 $ - $ 119 $ - $ 654 |
Basis of Presentation, Nature43
Basis of Presentation, Nature of Business and Summary of Significant Accounting Policies (Details Narrative) | 12 Months Ended |
Dec. 31, 2015USD ($)Numbershares | |
Prepaid advertising costs | $ | $ 920,000 |
Building [Member] | |
Useful lives | P39Y |
2015 Stock Incentive Plan [Member] | |
Number of shares, granted | shares | 65,000 |
Minimum [Member] | |
Finite-lived intangible asset, useful life | 3 years |
Minimum [Member] | Computer Equipment and Software [Member] | |
Useful lives | P3Y |
Minimum [Member] | Improvements and Equipment [Member] | |
Useful lives | P3Y |
Maximum [Member] | |
Finite-lived intangible asset, useful life | 15 years |
Maximum [Member] | Computer Equipment and Software [Member] | |
Useful lives | P10Y |
Maximum [Member] | Improvements and Equipment [Member] | |
Useful lives | P15Y |
Franchising [Member] | Alpha Graphics, Inc. [Member] | |
Number of domestic business centers | 254 |
Number of international business centers | 25 |
Percentage of equity method investment | 99.20% |
Business acquisition, effective date of acquisition | Oct. 1, 2014 |
Cellular Retail [Member] | PQH Wireless, Inc. [Member] | |
Number of stores | 99 |
Percentage of equity method investment | 100.00% |
Direct to Consumer [Member] | JPPA [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
Direct to Consumer [Member] | RAI [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
Direct to Consumer [Member] | JPRE [Member] | |
Percentage of equity method investment | 100.00% |
Business acquisition, effective date of acquisition | Jul. 1, 2015 |
Consumer Finance [Member] | Wyoming Financial Lenders, Inc. [Member] | |
Number of stores | 46 |
Percentage of equity method investment | 100.00% |
Number of states in which entity operates | 8 |
Consumer Finance [Member] | Wyoming Financial Lenders, Inc. [Member] | Minimum [Member] | Payday [Member] | |
Non-recourse debt | $ | $ 100 |
Consumer Finance [Member] | Wyoming Financial Lenders, Inc. [Member] | Minimum [Member] | Installment [Member] | |
Non-recourse debt | $ | 300 |
Consumer Finance [Member] | Wyoming Financial Lenders, Inc. [Member] | Maximum [Member] | Payday [Member] | |
Non-recourse debt | $ | 500 |
Consumer Finance [Member] | Wyoming Financial Lenders, Inc. [Member] | Maximum [Member] | Installment [Member] | |
Non-recourse debt | $ | $ 800 |
Consumer Finance [Member] | Express Pawn, Inc. [Member] | |
Number of stores | 3 |
Percentage of equity method investment | 100.00% |
Risks Inherent in the Operati44
Risks Inherent in the Operating Environment (Details) - Consumer Finance Segment [Member] | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Nebraska [Member] | ||
Percentage of revenues | 33.00% | 30.00% |
North Dakota [Member] | ||
Percentage of revenues | 19.00% | 18.00% |
Wyoming [Member] | ||
Percentage of revenues | 14.00% | 14.00% |
Iowa [Member] | ||
Percentage of revenues | 14.00% | 14.00% |
Risks Inherent in the Operati45
Risks Inherent in the Operating Environment (Details Narrative) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Risks and Uncertainties [Abstract] | ||
WCRS Cash,Excess Over FDIC Insured Amount | $ 5,690,000 | $ 2,250,000 |
Loans Receivable (Details)
Loans Receivable (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | $ 6,061,438 | $ 6,550,266 |
Less Allowance | (1,177,000) | (1,219,000) |
Notes, Loans and Financing Receivable, Net current | 4,884,438 | 5,331,266 |
Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 4,644,167 | 5,081,832 |
1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 375,396 | 352,703 |
31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 287,719 | 248,256 |
61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 215,819 | 247,871 |
91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 205,540 | 212,143 |
121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 165,371 | 202,085 |
151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 167,426 | 205,376 |
Payday [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 5,382,681 | 5,763,922 |
Less Allowance | (1,081,000) | (1,147,000) |
Notes, Loans and Financing Receivable, Net current | 4,301,681 | 4,616,922 |
Payday [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 4,065,706 | 4,387,393 |
Payday [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 332,217 | 305,382 |
Payday [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 263,486 | 223,465 |
Payday [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 199,526 | 236,072 |
Payday [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 196,123 | 206,705 |
Payday [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 160,386 | 200,101 |
Payday [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 165,237 | 204,804 |
Installment Loans [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 392,243 | 413,539 |
Less Allowance | (96,000) | (72,000) |
Notes, Loans and Financing Receivable, Net current | 296,243 | 341,539 |
Installment Loans [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 291,947 | 321,634 |
Installment Loans [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 43,179 | 47,321 |
Installment Loans [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 24,233 | 24,791 |
Installment Loans [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 16,293 | 11,799 |
Installment Loans [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 9,417 | 5,438 |
Installment Loans [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 4,985 | 1,984 |
Installment Loans [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | 2,189 | 572 |
Pawn Title [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | $ 286,514 | $ 372,805 |
Less Allowance | ||
Notes, Loans and Financing Receivable, Net current | $ 286,514 | $ 372,805 |
Pawn Title [Member] | Current [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | $ 286,514 | $ 372,805 |
Pawn Title [Member] | 1 To 30 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 31 to 60 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 61 To 90 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 91 To 120 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 121 To 150 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current | ||
Pawn Title [Member] | 151 To 180 Days [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes, Loans and Financing Receivable, Gross, Current |
Loans Receivable Allowance (Det
Loans Receivable Allowance (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for Loan and Lease Losses [Roll Forward] | ||
Loans receivable allowance, beginning of period | $ 1,219,000 | $ 1,215,000 |
Provision for loan losses charged to expense | 1,904,893 | 1,817,822 |
Charge-offs, net | (1,946,893) | (1,813,822) |
Loans receivable allowance, end of period | $ 1,177,000 | $ 1,219,000 |
Loans Receivable Allowance (D48
Loans Receivable Allowance (Details Narrative) | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 43.00% |
1 To 30 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 43.00% |
31 to 60 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 65.00% |
61 To 90 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 83.00% |
91 To 120 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 89.00% |
121 To 150 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 91.00% |
151 To 180 Days [Member] | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Percentage of historical written off | 93.00% |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts receivable | $ 2,235,192 | $ 1,194,532 |
Less allowance | (272,000) | (59,405) |
Net account receivable | 1,963,192 | 1,135,127 |
Franchise [Member] | ||
Accounts receivable | 1,332,446 | 1,194,532 |
Less allowance | (183,000) | (59,405) |
Net account receivable | 1,149,446 | $ 1,135,127 |
Cellular Retail [Member] | ||
Accounts receivable | $ 148,346 | |
Less allowance | ||
Net account receivable | $ 148,346 | |
Direct to Consumer [Member] | ||
Accounts receivable | 754,400 | |
Less allowance | (89,000) | |
Net account receivable | $ 665,400 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, plant and equipment, gross | $ 12,667,231 | $ 4,337,475 | $ 2,447,409 |
Property, plant and equipment, acquisitions, gross | 8,634,622 | 401,302 | |
Property, plant and equipment, additions, gross | 769,295 | 237,161 | |
Property, plant and equipment, deletions, gross | (1,074,161) | (68,038) | |
Accumulated depreciation | (4,105,910) | (3,139,765) | (1,519,335) |
Accumulated depreciation, acquisition | (1,334,555) | (1,319,641) | |
Accumulated depreciation, additions | (697,956) | (368,827) | |
Accumulated depreciation, deletions | 1,066,366 | 68,038 | |
Property, plant and equipment, net | 8,561,321 | 1,197,710 | 928,074 |
Property, plant and equipment, acquisitions, net | 7,300,067 | 1,720,943 | |
Property, plant and equipment, additions, net | 71,339 | $ (131,666) | |
Property, plant and equipment, deletions, net | (7,795) | ||
Furniture And Equipment [Member] | |||
Property, plant and equipment, gross | 3,799,327 | $ 2,853,603 | 1,571,152 |
Property, plant and equipment, acquisitions, gross | 1,202,435 | 1,159,500 | |
Property, plant and equipment, additions, gross | 605,204 | 159,076 | |
Property, plant and equipment, deletions, gross | (861,915) | (36,125) | |
Leasehold Improvements [Member] | |||
Property, plant and equipment, gross | $ 721,151 | 787,188 | 701,764 |
Property, plant and equipment, acquisitions, gross | 73,798 | ||
Property, plant and equipment, additions, gross | $ 22,766 | 43,539 | |
Property, plant and equipment, deletions, gross | (88,803) | (31,913) | |
Software [Member] | |||
Property, plant and equipment, gross | 1,692,239 | 504,967 | 17,322 |
Property, plant and equipment, acquisitions, gross | 1,197,839 | $ 487,645 | |
Property, plant and equipment, additions, gross | 112,876 | ||
Property, plant and equipment, deletions, gross | (123,443) | ||
Building [Member] | |||
Property, plant and equipment, gross | 5,148,703 | $ 85,906 | 85,906 |
Property, plant and equipment, acquisitions, gross | 5,034,348 | ||
Property, plant and equipment, additions, gross | $ 28,449 | ||
Property, plant and equipment, deletions, gross | |||
Land [Member] | |||
Property, plant and equipment, gross | $ 1,209,500 | $ 9,500 | 9,500 |
Property, plant and equipment, acquisitions, gross | $ 1,200,000 | ||
Property, plant and equipment, additions, gross | |||
Property, plant and equipment, deletions, gross | |||
Other [Member] | |||
Property, plant and equipment, gross | $ 96,311 | $ 96,311 | $ 61,765 |
Property, plant and equipment, acquisitions, gross | |||
Property, plant and equipment, additions, gross | $ 34,546 | ||
Property, plant and equipment, deletions, gross |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Gross amortizable intangible assets | $ 11,527,024 | $ 10,152,024 | $ 4,627,412 |
Acquisitions, Gross | 1,375,000 | 5,554,112 | |
Acquisitions, accumulated amortization | (105,480) | (992,950) | |
Acquisitions | 1,269,520 | 4,561,162 | |
Additions, amortizable intangible assets | 499,697 | 187,669 | |
Additions | (499,697) | (187,669) | |
Deletions, gross | (29,500) | ||
Deletions, amortizable intangible assets | 5,012 | ||
Deletions | (24,088) | ||
Less accumulated amortization | (6,290,700) | (5,685,523) | (4,510,316) |
Net Amortizable Intangible Assets | 5,236,324 | 4,466,501 | $ 117,096 |
Non-amortizable trademarks | 2,782,292 | 2,782,292 | |
Intangible Assets, net | 8,018,616 | 7,248,793 | $ 117,096 |
Customer Relationships [Member] | |||
Gross amortizable intangible assets | 6,072,912 | 4,924,912 | $ 4,627,412 |
Acquisitions, Gross | 1,148,000 | 327,000 | |
Deletions, gross | (29,500) | ||
Acquired Franchise Agreements [Member] | |||
Gross amortizable intangible assets | $ 5,227,112 | 5,227,112 | |
Acquisitions, Gross | $ 5,227,112 | ||
Other [Member] | |||
Gross amortizable intangible assets | $ 227,000 | ||
Acquisitions, Gross | $ 227,000 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
2,016 | $ 555,778 | ||
2,017 | 542,224 | ||
2,018 | 530,027 | ||
2,019 | 519,048 | ||
2,020 | 502,434 | ||
Thereafter | 2,586,813 | ||
Finite-Lived Intangible Assets, Net | $ 5,236,324 | $ 4,466,501 | $ 117,096 |
Deferred Revenue and Other Li53
Deferred Revenue and Other Liabilities (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred Revenue Disclosure [Abstract] | ||
Deferred financing fees | $ 285,452 | $ 284,231 |
Deferred franchise development fees | 264,000 | $ 281,837 |
Merchandise credits and gift card liability | 1,127,470 | |
Other | 119,416 | $ 72,000 |
Total | $ 1,796,338 | $ 638,068 |
Leases (Details)
Leases (Details) | Dec. 31, 2015USD ($) |
Leases [Abstract] | |
2,016 | $ 3,088,000 |
2,017 | 2,141,000 |
2,018 | 1,146,000 |
2,019 | 670,000 |
2,020 | 226,000 |
Thereafter | 7,000 |
Total minimum base lease payments | $ 7,278,000 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Leases [Abstract] | ||
Rent expense | $ 4,490,000 | $ 3,003,000 |
Notes Payable - Long Term (Deta
Notes Payable - Long Term (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||
Total | $ 7,996,460 | $ 5,125,000 |
Less current maturities | (4,900,008) | (3,500,000) |
Notes payable, noncurrent | 3,096,452 | 1,625,000 |
Note Payable to River City Equity [Member] | ||
Debt Instrument [Line Items] | ||
Total | 3,000,000 | 2,000,000 |
Note Payable to Financial Institution [Member] | ||
Debt Instrument [Line Items] | ||
Total | 1,625,000 | $ 3,125,000 |
Note Payable to Financial Institution Two [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 3,371,460 |
Notes Payable - Long Term (De57
Notes Payable - Long Term (Details 1) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Debt Disclosure [Abstract] | ||
2,016 | $ 4,900,008 | |
2,017 | 525,008 | |
2,018 | 400,008 | |
2,019 | 400,008 | |
2,020 | 400,008 | |
Thereafter | 1,371,420 | |
Long-term Debt | $ 7,996,460 | $ 5,125,000 |
Notes Payable - Long Term (De58
Notes Payable - Long Term (Details Narrative) | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ 7,250,000 |
Description of interest rate | (a) the prime rate plus 2.50% or (b) the LIBOR rate plus 5.50%. |
Note Payable to River City Equity [Member] | |
Debt Instrument [Line Items] | |
Maturity date | Jun. 30, 2016 |
Stated interest rate | 12.00% |
Maximum borrowing capacity | $ 3,000,000 |
Note Payable to Financial Institution [Member] | |
Debt Instrument [Line Items] | |
Principal periodic payment | $ 375,000 |
Stated interest rate | 6.00% |
Description of maturity date | March 2,017 |
Note Payable to Financial Institution [Member] | Addition to prime rate [Member] | |
Debt Instrument [Line Items] | |
Stated interest rate | 2.50% |
Note Payable to Financial Institution Two [Member] | |
Debt Instrument [Line Items] | |
Maturity date | Jun. 5, 2019 |
Principal periodic payment | $ 33,334 |
Stated interest rate | 3.75% |
Note Payable to Financial Institution Two [Member] | Addition to LIBOR Rate [Member] | |
Debt Instrument [Line Items] | |
Stated interest rate | 3.50% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | ||
Federal | $ 1,535,444 | $ 1,007,860 |
State | 305,120 | 181,000 |
Foreign | 30,200 | 8,000 |
Current Income Tax Expense (Benefit) | 1,870,764 | 1,196,860 |
Deferred: | ||
Federal | 547,000 | 293,000 |
State | 64,000 | 56,000 |
Deferred Income Tax Expense (Benefit) | 611,000 | 349,000 |
Income tax expense | $ 2,481,764 | $ 1,545,860 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred income tax assets: | ||
Allowance for accounts and loans receivable | $ 544,000 | $ 521,000 |
Inventory capitalization | 120,000 | |
Inventory reserve | 75,000 | |
Prepaid expense | (374,000) | |
Accrued expenses | 198,000 | $ 123,000 |
Deferred income taxes | 563,000 | 644,000 |
Deferred income tax assets, net | 563,000 | 644,000 |
Deferred income tax liabilities: | ||
Property and equipment | (721,000) | (306,000) |
Goodwill and intangible assets | (3,864,000) | (3,867,000) |
Net operating losses (expires 2031) | 113,000 | 208,000 |
Capital loss carryforward (expires 2016) | 20,000 | 21,000 |
Foreign tax credits | 21,000 | 40,000 |
Valuation allowance | (21,000) | (35,000) |
Deferred income taxes | (4,452,000) | (3,939,000) |
Net | $ (4,452,000) | $ (3,939,000) |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense using the statutory federal rate | $ 2,047,000 | $ 1,345,000 |
State income taxes, net of federal benefit | 213,000 | 152,000 |
Transaction expenses | 119,000 | $ 64,000 |
Share based compensation | 41,000 | |
Other | 61,764 | $ (15,000) |
Income tax expense | $ 2,481,764 | $ 1,545,860 |
Equity (Details)
Equity (Details) - WCR 2015 Stock Incentive Plan [Member] | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | |
Outstanding and nonvested at beginning | shares | |
Granted | shares | 65,000 |
Vested | shares | |
Forfeited | shares | |
Outstanding and nonvested at ending | shares | 65,000 |
Exercisable at ending | shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |
Outstanding and nonvested at beginning | |
Granted | $ 6 |
Vested | |
Forfeited | |
Outstanding and nonvested at ending | $ 6 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Roll Forward] | |
Granted | 9 years 2 months 1 day |
Outstanding and nonvested at ending | 9 years 2 months 1 day |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Aggregate Intrinsic Value [Roll Forward] | |
Outstanding and nonvested at beginning | $ | |
Granted | |
Vested | $ | |
Forfeited | |
Outstanding and nonvested at ending | $ |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) | Jul. 02, 2015 | Oct. 01, 2014 | Sep. 30, 2014 | May. 30, 2014 | Dec. 31, 2015 | Feb. 06, 2015 | Dec. 31, 2014 | Feb. 02, 2008 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Description of reverse stock split | 1-for-20 reverse stock split. | |||||||
Capital units, authorized | 12,500,000 | |||||||
Common stock, shares issued | 9,497,534 | 5,997,588 | ||||||
2008 Stock Incentive Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares reserved for future issuance (in shares) | 100,000 | |||||||
WCR 2015 Stock Incentive Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares reserved for future issuance (in shares) | 100,000 | |||||||
Options granted | 65,000 | |||||||
Unrecognized stock-based compensation expense | $ 89,000 | |||||||
Period of unrecognized compensation cost | 1 year 1 month 6 days | |||||||
Vesting period | 3 years | |||||||
Expiration period | 10 years | |||||||
JPPA, RAI and JPRE Transaction [Member] | Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares issued for acqusition (in shares) | 3,500,000 | |||||||
Percent of voting rights issued as percent of post acquisition voting rights | 37.00% | |||||||
Common stock, shares issued | 9,497,534 | |||||||
Alpha Graphics, Inc. [Member] | Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares issued for acqusition (in shares) | 2,986,823 | 2,986,823 | ||||||
Percent of voting rights issued as percent of post acquisition voting rights | 49.80% | 49.80% | ||||||
Common stock, shares issued | 5,997,588 |
Other Expenses (Details)
Other Expenses (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Other Income and Expenses [Abstract] | ||
Bank fees | $ 1,079,930 | $ 473,632 |
Collection costs | 431,682 | $ 449,301 |
Conference expense | 680,991 | |
Insurance | 540,257 | $ 305,935 |
Management and advisory fees | 578,082 | 536,369 |
Professional and consulting fees | 1,911,163 | 1,048,599 |
Supplies | 694,302 | 637,730 |
Other | 2,844,765 | 1,096,389 |
Total other expenses | $ 8,761,172 | $ 4,547,955 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | Dec. 31, 2015 | Jul. 02, 2015 | Jun. 01, 2015 | Dec. 31, 2014 | Oct. 01, 2014 |
Property and equipment, net | $ 7,300,067 | $ 1,720,943 | |||
Alpha Graphics, Inc. [Member] | |||||
Cash | $ 168,000 | ||||
Other receivables | 1,227,000 | ||||
Property and equipment, net | 374,000 | ||||
Intangible assets, net | 7,016,000 | ||||
Note receivable | 636,000 | ||||
Other assets | 453,000 | ||||
Accounts payable and accrued liabilities | (2,493,000) | ||||
Other liabilities | (506,000) | ||||
Notes payable and capital leases | (4,084,000) | ||||
Deferred income tax liability | (2,434,000) | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 357,000 | ||||
Noncontrolling interests | (7,000) | ||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest | $ 350,000 | ||||
Cellular Retail [Member] | |||||
Cash | $ 389,000 | ||||
Inventory | 427,000 | ||||
Other receivables | 405,000 | ||||
Property and equipment, net | 612,000 | ||||
Goodwill | 578,000 | ||||
Intangible assets, net | 903,000 | ||||
Other assets | 69,000 | ||||
Accounts payable and accrued liabilities | (826,000) | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 2,557,000 | ||||
JPPA, RAI and JPRE Transaction [Member] | |||||
Cash | $ 2,082,000 | ||||
Inventory | 3,170,000 | ||||
Deferred income tax asset | 186,000 | ||||
Prepaid expense and other current assets | 525,000 | ||||
Property and equipment, net | 6,590,000 | ||||
Goodwill | 31,000 | ||||
Intangible assets, net | 122,000 | ||||
Other assets | 527,000 | ||||
Accounts payable and accrued liabilities | (2,231,000) | ||||
Short-term notes payable | (120,000) | ||||
Income taxes payable | (547,000) | ||||
Deferred revenue and other | (460,000) | ||||
Notes payable and capital leases | (3,583,000) | ||||
Deferred income tax liability | (169,000) | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | $ 6,123,000 |
Acquisitions (Details 1)
Acquisitions (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Pro forma revenue | $ 106,285 | $ 104,747 |
% of total pro forma revenue | 100.00% | 100.00% |
Pro forma net income | $ 5,830 | $ 5,185 |
Pro forma net income attributable to noncontrolling interests | 17 | 13 |
Pro forma net income attributable to WCR common shareholders | $ 5,813 | $ 5,172 |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ 0.612 | $ 0.544 |
Franchise [Member] | ||
Pro forma revenue | $ 13,025 | $ 12,215 |
% of total pro forma revenue | 12.30% | 11.70% |
Pro forma net income | $ 2,270 | $ 1,554 |
Pro forma net income attributable to noncontrolling interests | 17 | 13 |
Pro forma net income attributable to WCR common shareholders | $ 2,253 | $ 1,541 |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ 0.237 | $ 0.162 |
Cellular Retail [Member] | ||
Pro forma revenue | $ 37,823 | $ 36,033 |
% of total pro forma revenue | 35.60% | 34.40% |
Pro forma net income | $ 1,167 | $ 930 |
Pro forma net income attributable to noncontrolling interests | ||
Pro forma net income attributable to WCR common shareholders | $ 1,167 | $ 930 |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ 0.123 | $ 0.098 |
Direct to Consumer [Member] | ||
Pro forma revenue | $ 42,738 | $ 43,622 |
% of total pro forma revenue | 40.20% | 41.60% |
Pro forma net income | $ 2,177 | $ 1,427 |
Pro forma net income attributable to noncontrolling interests | ||
Pro forma net income attributable to WCR common shareholders | $ 2,177 | $ 1,427 |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ 0.229 | $ 0.15 |
Consumer Finance [Member] | ||
Pro forma revenue | $ 12,699 | $ 12,877 |
% of total pro forma revenue | 11.90% | 12.30% |
Pro forma net income | $ 952 | $ 1,274 |
Pro forma net income attributable to noncontrolling interests | ||
Pro forma net income attributable to WCR common shareholders | $ 952 | $ 1,274 |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ 0.1 | $ 0.134 |
Corporate [Member] | ||
Pro forma revenue | ||
% of total pro forma revenue | 0.00% | 0.00% |
Pro forma net income | $ (736) | |
Pro forma net income attributable to noncontrolling interests | ||
Pro forma net income attributable to WCR common shareholders | $ (736) | |
Pro forma earnings per share attributable to WCR common shareholders - basic and diluted (in dollars per share) | $ (0.077) |
Acquisitions (Details Narrative
Acquisitions (Details Narrative) - Common Stock [Member] - shares | Jul. 02, 2015 | Oct. 01, 2014 | Sep. 30, 2014 |
JPPA, RAI and JPRE Transaction [Member] | |||
Number of shares issued for acqusition | 3,500,000 | ||
Percent of voting rights issued as percent of post acquisition voting rights | 37.00% | ||
Alpha Graphics, Inc. [Member] | |||
Number of shares issued for acqusition | 2,986,823 | 2,986,823 | |
Percent of voting rights issued as percent of post acquisition voting rights | 49.80% | 49.80% |
Segment Information (Details)
Segment Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Segment Reporting Information [Line Items] | ||
Revenues from external customers | $ 76,454,035 | $ 40,759,553 |
Depreciation and amortization | 1,198,000 | 556,000 |
Interest expense | 575,712 | 315,568 |
Income tax expense (benefit) | 2,481,764 | 1,545,860 |
Net income (loss) | 3,537,436 | 2,411,432 |
Total segment assets | 56,185,333 | 36,762,264 |
Expenditures for segmented assets | 4,341,000 | 654,000 |
Franchise [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues from external customers | 13,025,000 | 3,177,000 |
Depreciation and amortization | 441,000 | 112,000 |
Interest expense | 202,000 | 630,000 |
Income tax expense (benefit) | 1,373,000 | 441,000 |
Net income (loss) | 2,270,000 | 690,000 |
Total segment assets | 10,079,000 | 10,053,000 |
Expenditures for segmented assets | 113,000 | 16,000 |
Cellular Retail [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues from external customers | 32,846,000 | 24,706,000 |
Depreciation and amortization | 430,000 | 327,000 |
Interest expense | 284,000 | 191,000 |
Income tax expense (benefit) | 632,000 | 385,000 |
Net income (loss) | 1,110,000 | 584,000 |
Total segment assets | 14,180,000 | 9,777,000 |
Expenditures for segmented assets | 3,865,000 | $ 519,000 |
Direct to Consumer [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues from external customers | 17,884,000 | |
Depreciation and amortization | 214,000 | |
Interest expense | 90,000 | |
Income tax expense (benefit) | 207,000 | |
Net income (loss) | 2,430,000 | |
Total segment assets | 15,878,000 | |
Expenditures for segmented assets | 304,000 | |
Consumer Finance [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues from external customers | 12,699,000 | $ 12,877,000 |
Depreciation and amortization | $ 113,000 | 117,000 |
Interest expense | 62,000 | |
Income tax expense (benefit) | $ 574,000 | 720,000 |
Net income (loss) | 952,000 | 1,137,000 |
Total segment assets | 15,511,000 | 16,932,000 |
Expenditures for segmented assets | $ 45,000 | $ 119,000 |
Corporate [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues from external customers | ||
Depreciation and amortization | ||
Interest expense | ||
Income tax expense (benefit) | $ (304,000) | |
Net income (loss) | (1,038,000) | |
Total segment assets | 537,000 | |
Expenditures for segmented assets | $ 14,000 |
Segment Information (Details Na
Segment Information (Details Narrative) | 12 Months Ended |
Dec. 31, 2015Number | |
Segment Information Details Narrative | |
Number of operating segment | 5 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) | Nov. 10, 2015USD ($)Number | Feb. 09, 2015USD ($)Number$ / sharesshares | Apr. 11, 2013 | Sep. 30, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
AlphaGraphics [Member] | ||||||
Litigation settlement | $ 636,000 | |||||
Vendor Service Agreement [Member] | ||||||
Period of service agreement | 3 years | |||||
Service agreement with vendor | $ 680,000 | |||||
Other Employment Agreement [Member] | ||||||
Bonus arrangement current | $ 1,008,000 | $ 352,000 | ||||
Other Employment Agreement [Member] | Chief Investment Officer [Member] | ||||||
Period of service agreement | 3 years | |||||
Potential bonus arrangement current | $ 200,000 | |||||
Other Employment Agreement [Member] | Chief Executive Officer [Member] | ||||||
Period of service agreement | 3 years | |||||
Other Employment Agreement [Member] | Mr. Donchev [Member] | ||||||
Period of service agreement | 10 years | |||||
Number of shares, granted | shares | 65,000 | |||||
Exercise price (in dollars per share) | $ / shares | $ 6 | |||||
Number of installments for option vest | Number | 3 | |||||
Asset Purchase Agreement [Member] | PQH Wireless, Inc. [Member] | ||||||
Number of retail stores | Number | 10 | |||||
Cost of retail stores | $ 456,000 |
Management and Advisory Agree71
Management and Advisory Agreement (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Management And Advisory Agreement | ||
Other fee payable description | The amended and restated agreement requires the Company to pay Blackstreet a fee in an amount equal to $400,000 upon the closing of an acquisition in consideration for Blackstreets referral to the Company of such acquisition opportunity, and Blackstreets assistance in the performance of due diligence services relating thereto. Any fees which may have been payable per these terms related to the AGI, JPPA, RAI and JPRE acquisitions (see Note 13) were waived by Blackstreet. | |
Management fee payable description | The annual fees under the amended and restated contract will be the greater of (i) $612,100 (subject to annual increases of five percent) or (ii) five percent of Western Capitals EBITDA as defined under the agreement. All other terms and provisions remain unmodified. | |
Management and advisory fees | $ 478,082 | $ 416,369 |
Termination fee trigger | 50.00% |
Special Committee of the Boar72
Special Committee of the Board of Directors (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Special Committee Of Board Of Directors | ||
Special committee fees expense | $ 50,000 | $ 50,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) | Dec. 07, 2012USD ($) | Aug. 31, 2011USD ($)Number | Oct. 31, 2012USD ($) | Dec. 31, 2015USD ($)Number | Dec. 31, 2014USD ($) |
Lease payments | $ 4,490,000 | $ 3,003,000 | |||
Maximum borrowing capacity | $ 7,250,000 | ||||
New Lease Property [Member] | Ladary Inc [Member] | |||||
Number of properties | Number | 2 | ||||
Lease payments | $ 6,000 | ||||
Lease term | 4 years | ||||
Number of operating leases | Number | 2 | ||||
Other Related Party [Member] | |||||
Number of properties | Number | 3 | ||||
Other Related Party [Member] | Lease Property Extends Through October 2016 [Member] | |||||
Lease payments | $ 1,680 | ||||
Other Related Party [Member] | Lease Property Month-To-Month [Member] | |||||
Lease payments | 1,200 | ||||
Other Related Party [Member] | Lease Property Extends Through November 2017 [Member] | |||||
Lease payments | 5,000 | ||||
Related Party [Member] | |||||
Lease payments | $ 171,000 | $ 166,500 | |||
Number of retail stores | Number | 5 | ||||
Related Party [Member] | Latter Lease [Member] | |||||
Lease payments | $ 5,000 | ||||
Lease term | 5 years | ||||
River City Equity Inc [Member] | 12% Credit Facility [Member] | |||||
Maximum borrowing capacity | $ 3,000,000 | ||||
Frequency of payments | Monthly basis | ||||
Maturity date | Jun. 30, 2016 | ||||
Amount outstanding | $ 3,000,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | Jan. 02, 2016USD ($) |
Subsequent Event [Member] | PQH Wireless, Inc. [Member] | |
Cost of retail stores | $ 456,000 |