Butler National (BUKS) 10-Q 17 Mar 15 2015 Q3 Quarterly report Financial data

Document_and_Entity_Informatio

Document and Entity Information	9 Months Ended
	Jan. 31, 2015	Mar. 06, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	BUTLER NATIONAL CORP
Entity Central Index Key	15847
Current Fiscal Year End Date	-26
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		61,493,092
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	FALSE
Document Period End Date	31-Jan-15

CONDENSED_CONSOLIDATED_BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (USD $)	Jan. 31, 2015	Apr. 30, 2014
In Thousands, unless otherwise specified
CURRENT ASSETS:
Cash	$5,052	$6,261
Accounts receivable	2,456	3,109
Inventories
Raw materials	5,330	5,102
Work in process	2,205	1,090
Finished goods	144	144
Total inventory	7,679	6,336
Prepaid expenses and other current assets	1,171	825
Total current assets	16,358	16,531
PROPERTY, PLANT AND EQUIPMENT:
Land and building	4,071	4,044
Aircraft	7,300	6,723
Machinery and equipment	3,586	3,535
Office furniture and fixtures	6,648	6,447
Leasehold improvements	4,081	4,060
Property, plant and equipment, gross	25,686	24,809
Accumulated depreciation	-13,996	-12,140
Total property, plant and equipment	11,690	12,669
SUPPLEMENTAL TYPE CERTIFICATES (net of amortization of $2,953 at January 31, 2015 and $2,841 at April 30, 2014)	4,938	3,744
OTHER ASSETS:
Deferred tax asset	1,335	1,335
Other assets (net of accumulated amortization of $3,596 at January 31, 2015 and $2,520 at April 30, 2014)	7,312	7,399
Total other assets	8,647	8,734
Total Assets	41,633	41,678
CURRENT LIABILITIES:
Promissory notes	1,502	1,757
Current maturities of long-term debt	3,627	3,908
Accounts payable	1,533	1,375
Customer deposits	2,192	982
Gaming facility mandated payment	930	1,267
Compensation and compensated absences	1,156	1,122
Other current liabilities	388	93
Total current liabilities	11,328	10,504
LONG-TERM DEBT, NET OF CURRENT MATURITIES:	5,211	6,820
Total liabilities	16,539	17,324
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, par value $.01: authorized 100,000,000 shares issued and outstanding 61,493,092 shares at January 31, 2015 and 61,493,092 shares at April 30, 2014	614	614
Capital contributed in excess of par	13,282	13,282
Treasury stock at cost, 600,000 shares	-732	-732
Retained Earnings	8,483	8,134
Total stockholders' equity Butler National Corporation	21,647	21,298
Noncontrolling Interest in BHCMC, LLC	3,447	3,056
Total stockholders' equity	25,094	24,354
Total Liabilities and Stockholders' Equity	41,633	41,678
Preferred Class A [Member]
STOCKHOLDERS' EQUITY:
Preferred stock	0	0
Preferred Class B [Member]
STOCKHOLDERS' EQUITY:
Preferred stock	$0	$0

CONDENSED_CONSOLIDATED_BALANCE1

CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) (USD $)	3 Months Ended	9 Months Ended
In Thousands, except Share data, unless otherwise specified	Apr. 30, 2014	Jan. 31, 2015	Jan. 31, 2014
ASSETS
SUPPLEMENTAL TYPE CERTIFICATES net of amortization	$2,841	$2,953
OTHER ASSETS
Other assets, accumulated amortization	2,520	3,596
STOCKHOLDERS' EQUITY:
Common stock, par value (in dollars per share)	$0.01	$0.01
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	61,493,092	61,493,092
Common stock, shares outstanding (in shares)	61,493,092	61,493,092
Common stock, shares owed but not issued (in shares)	0	0
Treasury stock (in shares)	600,000	600,000
Class A [Member]
STOCKHOLDERS' EQUITY:
Preferred stock, par value (in dollars per share)	$5	$5
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Preferred stock, stated value (in dollars per share)	$100	$100
Preferred stock, dividend rate (in hundredths)	9.80%	9.80%
Preferred stock, liquidation preference value (in hundredths)	9.80%	9.80%
Preferred stock, redemption value	100	100
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Class B [Member]
STOCKHOLDERS' EQUITY:
Preferred stock, par value (in dollars per share)	$5	$5
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Preferred stock, stated value (in dollars per share)	$1,000	$1,000
Preferred stock, dividend rate (in hundredths)		6.00%	6.00%
Preferred stock, liquidation preference value (in hundredths)		6.00%	6.00%
Preferred stock, redemption value	$1,000	$1,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Class A and B [Member]
STOCKHOLDERS' EQUITY:
Preferred stock, designated classes (in shares)	200,000	200,000

CONDENSED_CONSOLIDATED_STATEME

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (USD $)	3 Months Ended		9 Months Ended
In Thousands, except Share data, unless otherwise specified	Jan. 31, 2015	Jan. 31, 2014	Jan. 31, 2015	Jan. 31, 2014
REVENUE:
Professional Services	$7,757	$6,984	$22,834	$22,820
Aerospace Products	3,326	3,860	12,392	9,819
Total revenue	11,083	10,844	35,226	32,639
COSTS AND EXPENSES:
Cost of Professional Services	4,715	4,498	13,886	14,068
Cost of Aerospace Products	2,477	2,843	9,150	7,787
Marketing and advertising	1,010	868	3,311	3,185
Employee benefits	487	571	1,352	1,651
Depreciation and amortization	693	870	2,244	2,630
General, administrative and other	1,166	1,176	3,575	3,356
Total costs and expenses	10,548	10,826	33,518	32,677
OPERATING INCOME	535	18	1,708	-38
OTHER INCOME (EXPENSE):
Interest expense	-251	-348	-843	-1,100
Other income, net	5	2	12	42
Total other income (expense),	-246	-346	-831	-1,058
INCOME (LOSS) BEFORE INCOME TAXES	289	-328	877	-1,096
Net income (loss)	289	-227	741	-737
Net income attributable to noncontrolling interest in BHCMC, LLC	-221	8	-391	-116
NET INCOME (LOSS) ATTRIBUTABLE TO BUTLER NATIONAL CORPORATION	68	-219	350	-853
PROVISION FOR INCOME TAXES
Provision (benefit) for income taxes	$0	($101)	$136	($359)
BASIC EARNINGS PER COMMON SHARE (in dollars per share)	$0	$0	$0.01	($0.01)
WEIGHTED AVERAGE SHARES USED IN PER SHARE CALCULATION (in shares)	60,893,092	59,019,173	60,893,092	59,019,173
DILUTED EARNINGS PER COMMON SHARE (in dollars per share)	$0	$0	$0.01	($0.01)
WEIGHTED AVERAGE SHARES USED IN PER SHARE CALCULATION (in shares)	60,893,092	59,019,173	60,893,092	59,019,173

CONDENSED_CONSOLIDATED_STATEME1

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Jan. 31, 2015	Jan. 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$741	($737)
Adjustments to reconcile cash flows from operating activities
Depreciation and amortization	3,044	3,255
Stock issued for services	0	22
Gain and loss on disposal of other assets	0	-36
Increase (Decrease) in Deferred Income Taxes	0	-424
Increase (Decrease) in Other Noncurrent Assets	-231	12
Changes in assets and liabilities
Accounts receivable	653	974
Income tax receivable	0	1,185
Inventories	-1,343	-1,116
Prepaid expenses and other current assets	-346	62
Accounts payable	157	-258
Customer deposits	1,210	887
Accrued liabilities	34	-56
Gaming facility mandated payment	-337	-328
Other liabilities	295	136
Increase (Decrease) in Deferred Income Taxes	0	-424
Increase (Decrease) in Other Noncurrent Assets	-231	12
Cash flows from operating activities	3,877	3,578
CASH FLOWS FROM INVESTING ACTIVITIES
Cash flows from investing activities	-2,183	-174
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings of promissory notes, net	-255	367
Contributed capital	0	0
Borrowings on long-term debt	704	0
Repayments of long-term debt	-3,352	-3,848
Cash flows from financing activities	-2,903	-3,481
NET DECREASE IN CASH	-1,209	-77
CASH, beginning of period	6,261	5,148
CASH, end of period	5,052	5,071
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest paid	843	1,102
Income taxes paid	0	0
NON CASH OPERATING ACTIVITY
Non cash stock issued for services	0	22
Intangible gaming equipment and notes	$758	$1,070

Organization_Consolidated_and_

Organization, Consolidated and Presentation of Financial Statements	9 Months Ended
	Jan. 31, 2015
Organization, Consolidated and Presentation of Financial Statements [Abstract]
Organization, Consolidated and Presentation of Financial Statements	1. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X and do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. Therefore, these financial statements should be read in conjunction with the annual report on Form 10-K for the fiscal year ended April 30, 2014. In our opinion, all adjustments (consisting of normal recurring accruals) necessary for a fair presentation have been included. Operating results for the three and nine months ended January 31, 2015 are not indicative of the results of operations that may be expected for the fiscal year ended April 30, 2015.
	Certain reclassifications within the condensed financial statement captions have been made to maintain consistency in presentation between years. Financial amounts are in thousands of dollars except per share amounts.

Net_Income_Loss_Per_Share

Net Income (Loss) Per Share	9 Months Ended
	Jan. 31, 2015
Net Income (Loss) Per Share [Abstract]
Net Income (Loss) Per Share	2. Net Income (Loss) Per Share: The Company follows ASC 260 that requires the reporting of both basic and diluted earnings (loss) per share. Basic earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. In accordance with ASC 260, any anti-dilutive effects on net earnings (loss) per share are excluded. The number of potential common shares as of January 31, 2015 is 66,281,237.

Research_and_Development

Research and Development	9 Months Ended
	Jan. 31, 2015
Research and Development [Abstract]
Research and Development	3. Research and Development: We invested in research and development activities. The amount invested in the nine months ended January 31, 2015 and 2014 was $1,220 and $1,569 respectively.

Borrowings

Borrowings	9 Months Ended
	Jan. 31, 2015
Borrowings [Abstract]
Borrowings	4. Debt: At January 31, 2015, the Company was utilizing three lines of credit totaling $4.0 million. The unused line at January 31, 2015 was $2.5 million. These funds were primarily used for the purchase of inventory and aircraft modification Supplemental Type Certificate ("STC") development costs for modifications and avionics.
	Our $1.0 million line of credit has been extended to August 2015. Our $2.5 million line of credit matures April 2015. Our $0.5 million line of credit matures June 2015.  The lines of credit are collateralized by the first and second positions on all assets of the Company.
	At January 31, 2015, there were several notes collateralized by aircraft security agreements totaling $1,560. These notes were used for the purchase and modifications of these collateralized aircraft and Butler Avionics, Inc.
	There are three notes at a bank totaling $1,213 for real estate located in Olathe, Kansas and Tempe, Arizona. The due date for these notes is March 2019 and August 2019.
	One note totaling $309 remains for real estate purchased in Dodge City, Kansas and matures in June 2016.
	One note collateralized by automobiles and equipment totals an additional $53 and matures in June 2016.
	The Kansas Lottery acquired additional gaming machines.  BHCMC, as manager under the management contract with the State of Kansas, was required to remit payment for the gaming equipment. The balance of these financed payables are $635.
	BHCMC, LLC ("BHCMC") entered into an agreement dated May 1, 2011, and amended via an addendum dated January 1, 2012, with BHC Investment Company, L.C. ("BHCI") for a total obligation of $7,423.  BHCI provided funds to BHCMC for the purchase of certain intangible items and gaming items related to the Boot Hill Casino.  Commencing on January 1, 2012, BHCMC is obligated to make a minimum payment to BHCI of $177 per month until September 30, 2017.  The remaining balance on the obligation is $3,511.
	On August 24, 2012 BHCMC and BHCI entered into a second agreement of $2,500 for tenant improvements related to expansion of the Boot Hill Casino.  Commencing on November 1, 2012. BHCMC is obligated to make a minimum payment to BHCI of approximately $55 per month until November 30, 2017.  The remaining obligation is $1,557.
	We are not in default of any of our notes as of January 31, 2015.
	We believe that our current banks will provide the necessary capital for our business operations. However, we continue to maintain contact with other banks that have an interest in funding our working capital needs to continue our growth in operations in 2015 and beyond.

Other_Assets

Other Assets	9 Months Ended
	Jan. 31, 2015
Other Assets [Abstract]
Other Assets	5. Other Assets: Our other asset account includes assets of $5,500 related to the Kansas Expanded Lottery Act Management Contract privilege fee, $3,011 of gaming equipment we were required to pay for ownership by the State of Kansas Lottery, and JET autopilot intellectual property of $1,417.  BHCMC expects the $5,500 privilege fee to have a value over the remaining life of the Management Contract with the State of Kansas which will end in December 2024.  There is no assurance of the Management Contract renewal.  The Managers Certificate asset for use of gaming equipment is being amortized over a period of three years based on the estimated useful life of gaming equipment.  The JET intellectual property is being amortized over a period of 15 years.

Stock_Options

Stock Options	9 Months Ended
	Jan. 31, 2015
Stock Options [Abstract]
Stock Options	6. Stock Options: At January 31, 2015 we had 7,262,064 outstanding stock options that were issued on December 31, 2010 all of which expire on December 31, 2015.
	The exercise price for the incentive stock options is $0.49. The Board of Directors approved the issuance of incentive stock options on December 31, 2010 with the goals of increasing shareholder value, expanding the number of managers participating in the program, and increasing the percentage of compensation tied to share price performance.
	The incentive stock options are allocated in three groups with two conditions for vesting. The first condition is stock price and the second condition is time. There are 2,420,688 options at $0.49 that may be exercised if and when the share price reaches $0.92, and 2,420,688 options at $0.49 that may be exercised if and when the share price reaches $1.41, and 2,420,688 options at $0.49 that may be exercised on or after December 31, 2013 if and when the share price reaches $1.90.

Subsequent_Events

Subsequent Events	9 Months Ended
	Jan. 31, 2015
Subsequent Events [Abstract]
Subsequent Events [Text Block]	7.  Subsequent Events: The Company evaluated its January 31, 2015 financial statements for subsequent events through March 17, 2015, the filing date of this report. The Company is not aware of any subsequent events that would require recognition or disclosure in the financial statements other than the items listed below.
	BHCMC and BHC Development filed a complaint against Bally Gaming in the United States District Court for the District of Kansas in June 2012.  After hearing the evidence, in March 2014 the jury rendered a verdict in favor of BHCMC and BHC Development in the amount of $1,424 in .  Bally appealed the verdict.  In February of 2015, BHCMC and BHC Development agreed to accept the sum of $1,324 in satisfaction of the judgment.  This amount was received in February 2015.  BHCMC and BHC Development have further agreed to return to Bally its system-related equipment.
	Butler National Corporation, its management, or subsidiaries have no ownership interest in BHCI or BHCD.

Net_Income_Loss_Per_Share_Deta

Net Income (Loss) Per Share (Details)	9 Months Ended
	Jan. 31, 2015
Net Income (Loss) Per Share [Abstract]
Potential common shares excluded from earnings per share calculation (in shares)	66,281,237

Research_and_Development_Detai

Research and Development (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Jan. 31, 2015	Jan. 31, 2014
Research and Development [Abstract]
Research and development	$1,220	$1,569

Borrowings_Details

Borrowings (Details) (USD $)	Jan. 31, 2015	Jul. 31, 2014
	Note
Line of Credit [Member]
Debt Instrument [Line Items]
Number of lines of credit	3
Unused line	$2,500,000
Line of Credit Facility, Maximum Borrowing Capacity	4,000,000
Line of credit facility borrowing capacity	4,000,000
Line of Credit 1 [Member]
Debt Instrument [Line Items]
Number of lines of credit	1
Line of Credit Facility, Maximum Borrowing Capacity	1,000,000
Line of credit facility borrowing capacity	1,000,000
Line of Credit 2 [Member]
Debt Instrument [Line Items]
Number of lines of credit	1
Line of Credit Facility, Maximum Borrowing Capacity	2,500,000
Line of credit facility borrowing capacity	2,500,000
Line of Credit 3 [Member]
Debt Instrument [Line Items]
Number of lines of credit	1
Line of Credit Facility, Maximum Borrowing Capacity	500,000
Line of credit facility borrowing capacity	500,000
Notes Collateralized by Aircraft Security Agreements [Member]
Debt Instrument [Line Items]
Notes payable	1,560,000
Notes Payable to Bank [Member]
Debt Instrument [Line Items]
Notes payable	1,213,000
Number of notes	3
Notes for Real Estate [Member]
Debt Instrument [Line Items]
Notes payable	309,000
Number of notes	1
Notes Collateralized by Automobiles and Equipment [Member]
Debt Instrument [Line Items]
Notes payable	53,000
Note With Konami Gaming [Member]
Debt Instrument [Line Items]
Notes payable	0
Number of notes	0
Face value of note entered	0
BHCMC Lottery Gaming Machines [Member]
Debt Instrument [Line Items]
Notes payable	635,000
Number of notes	1
Second Obligation With BHCI [Member]
Debt Instrument [Line Items]
Notes payable	1,557,000
Number of notes	1
Face value of note entered	2,500,000
Second BHCI Obligation Payment		55,000
Obligation With BHCI [Member]
Debt Instrument [Line Items]
Notes payable	3,511,000
Number of notes	1
First Obligation With BHCI [Member]
Debt Instrument [Line Items]
Face value of note entered	7,423,000
First BHCI Obligation Payment	$177,000

Other_Assets_Details

Other Assets (Details) (USD $)	9 Months Ended
In Thousands, unless otherwise specified	Jan. 31, 2015
Kansas Expanded Lottery Act Contract Privilege [Member]
Finite-Lived Intangible Assets [Line Items]
Other intangible assets	$5,500
Intangible Gaming Support Items [Member]
Finite-Lived Intangible Assets [Line Items]
Other intangible assets	3,011
JET Autopilot Intellectual Property [Member]
Finite-Lived Intangible Assets [Line Items]
Other intangible assets	$1,417
Useful life	15 years

Stockholders_Equity_Details

Stockholders' Equity (Details)	Jan. 31, 2015	Apr. 30, 2014
Stockholders' Equity [Abstract]
Common stock, shares issued (in shares)	61,493,092	61,493,092

Stock_Options_Details

Stock Options (Details) (USD $)	1 Months Ended
	Dec. 31, 2010	Jan. 31, 2015
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued (in shares)	7,200,000
Expiration date	31-Dec-15
Stock exercise price (in dollars per share)		$1.42
Incentive stock options condition for vesting [Abstract]
Shares outstanding (in shares)		7,262,064
Incentive Stock Option [Member] | Year 1 Target [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock exercise price (in dollars per share)		$0.49
Incentive stock options condition for vesting [Abstract]
Number of options than can be exercised (in shares)		2,420,688
Target price of share (in dollars per share)		$0.92
Incentive Stock Option [Member] | Year 2 Target [Member]
Incentive stock options condition for vesting [Abstract]
Number of options than can be exercised (in shares)		2,420,688
Target price of share (in dollars per share)		$1.41
Incentive Stock Option [Member] | Year 3 Target [Member]
Incentive stock options condition for vesting [Abstract]
Number of options than can be exercised (in shares)		2,420,688
Target price of share (in dollars per share)		$1.90

Subsequent_Events_Details

Subsequent Events (Details) (USD $)	Feb. 02, 2015	Mar. 07, 2014
In Thousands, unless otherwise specified
Subsequent Event [Line Items]
Damages Awarded to Plaintiff		$1,424
Damages Received from Defendant	$1,324

Uncategorized_Items

Uncategorized Items	5/1/2013 - 7/31/2013	5/1/2014 - 7/31/2014
	USD ($)	USD ($)
[us-gaap_PaymentsToAcquirePropertyPlantAndEquipment]	174,000	2,183,000