Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 13-May-14 | |
Document and Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Entity Registrant Name | 'DGSE COMPANIES INC | ' |
Entity Central Index Key | '0000701719 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Common Stock, Shares Outstanding | ' | 12,203,584 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Current Assets: | ' | ' |
Cash and cash equivalents | $2,784,944 | $3,214,770 |
Trade receivables, net of allowances | 285,137 | 269,616 |
Inventories | 12,222,439 | 12,921,857 |
Prepaid expenses | 279,884 | 236,649 |
Total current assets | 15,572,404 | 16,642,892 |
Property and equipment, net | 5,051,582 | 5,074,860 |
Intangible assets, net | 2,881,986 | 2,942,314 |
Other assets | 183,071 | 244,065 |
Total assets | 23,689,043 | 24,904,131 |
Current Liabilities: | ' | ' |
Current maturities of long-term debt | 124,600 | 122,536 |
Current maturities of capital leases | 11,209 | 11,091 |
Accounts payable-trade | 5,933,462 | 5,666,059 |
Accrued expenses | 1,696,873 | 2,137,361 |
Customer deposits and other liabilities | 1,934,949 | 2,401,574 |
Total current liabilities | 9,701,093 | 10,338,621 |
Line of credit, related party | 2,303,359 | 2,383,359 |
Long-term debt, less current maturities | 1,723,045 | 1,757,827 |
Total liabilities | 13,727,497 | 14,479,807 |
Commitments and contingencies | ' | ' |
STOCKHOLDERS' EQUITY | ' | ' |
Common stock, $0.01 par value; 30,000,000 shares authorized; 12,203,584 and 12,175,584 shares issued and outstanding | 122,035 | 121,755 |
Additional paid-in capital | 34,105,574 | 34,045,654 |
Accumulated deficit | -24,266,063 | -23,743,085 |
Total stockholders' equity | 9,961,546 | 10,424,324 |
Total liabilities and stockholders' equity | $23,689,043 | $24,904,131 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
CONSOLIDATED BALANCE SHEETS [Abstract] | ' | ' |
Common stock, par value per share | $0.01 | $0.01 |
Common stock, shares authorized | 30,000,000 | 30,000,000 |
Common stock, shares issued | 12,203,584 | 12,175,584 |
Common stock, shares outstanding | 12,203,584 | 12,175,584 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Revenue: | ' | ' |
Sales | $19,896,146 | $29,249,573 |
Cost of goods sold | 15,462,402 | 23,946,749 |
Gross margin | 4,433,744 | 5,302,824 |
Expenses: | ' | ' |
Selling, general and administrative expenses | 4,657,542 | 4,675,006 |
Depreciation and amortization | 190,923 | 192,884 |
Total operating expenses | 4,848,465 | 4,867,890 |
Operating (loss) income | -414,721 | 434,934 |
Other expense (income): | ' | ' |
Other income, net | -31,261 | -12,147 |
Interest expense | 84,562 | 51,704 |
Other expense (income) | 53,301 | 39,557 |
(Loss) income from continuing operations before income taxes | -468,022 | 395,377 |
Income tax expense | 17,316 | 57,600 |
(Loss) income from continuing operations | -485,338 | 337,777 |
Discontinued operations: | ' | ' |
Loss from discontinued operations, net of taxes of $0 | -37,640 | -37,365 |
Net (loss) income | ($522,978) | $300,412 |
Basic net (loss) income per common share: | ' | ' |
(Loss) income from continuing operations | ($0.04) | $0.02 |
Loss from discontinued operations | $0 | $0 |
Net (loss) income per share | ($0.04) | $0.02 |
Diluted net (loss) income per common share: | ' | ' |
(Loss) income from continuing operations | ($0.04) | $0.02 |
Loss from discontinued operations | $0 | $0 |
Net (loss) income per share | ($0.04) | $0.02 |
Weighted-average number of common shares | ' | ' |
Basic | 12,193,940 | 12,175,584 |
Diluted | 12,193,940 | 12,313,048 |
CONSOLIDATED_STATEMENTS_OF_OPE1
CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ' | ' |
Loss from discontinued operations, tax | $0 | $0 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Cash Flows From Operating Activities: | ' | ' |
Net (loss) income | ($522,978) | $300,412 |
Loss from discontinued operations | 37,640 | 37,365 |
(Loss) income from continuing operations | -485,338 | 337,777 |
Adjustments to reconcile (loss) income from continuing operations to net cash used in operating activities of continuing operations: | ' | ' |
Depreciation and amortization | 190,923 | 192,884 |
Stock based compensation | 60,200 | ' |
Changes in operating assets and liabilities: | ' | ' |
Trade receivables, net | -15,521 | -37,797 |
Inventories | 699,418 | -1,333,907 |
Prepaid expenses | -43,235 | 20,734 |
Other assets | 53,975 | -19,755 |
Accounts payable and accrued expenses | -173,085 | -4,670 |
Customer deposits and other liabilities | -466,625 | -227,728 |
Net cash used in operating activities of continuing operations | -179,288 | -1,072,462 |
Cash Flows From Investing Activities: | ' | ' |
Payments for property and equipment | -100,298 | -177,069 |
Net cash used in investing activities of continuing operations | -100,298 | -177,069 |
Cash Flows From Financing Activities: | ' | ' |
Repayment of debt | -29,871 | -54,069 |
Payments on capital lease obligations | -2,729 | -6,622 |
Repayment of line of credit with related party | -80,000 | ' |
Net cash used in financing activities of continuing operations | -112,600 | -60,691 |
Cash Flows From Discontinued Operations: | ' | ' |
Net cash provided by operating activities of discontinued operations | -37,640 | -37,365 |
Net change in cash | -429,826 | -1,347,587 |
Cash, beginning of period | 3,214,770 | 4,911,087 |
Cash, end of period | 2,784,944 | 3,563,500 |
Supplemental Disclosures: | ' | ' |
Cash paid during the period for: Interest | 69,344 | 40,390 |
Cash paid during the period for: Income taxes | ' | ' |
Basis_of_Presentation
Basis of Presentation | 3 Months Ended | ||
Mar. 31, 2014 | |||
Basis of Presentation [Abstract] | ' | ||
Basis of Presentation | ' | ||
-1 | Basis of Presentation | ||
The consolidated interim financial statements of DGSE Companies, Inc. included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") have been condensed or omitted pursuant to the Commission's rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. The Company suggests that these financial statements be read in conjunction with the financial statements and notes included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2013 (such fiscal year, "Fiscal 2013" and such annual Report on Form 10-K, the "Fiscal 2013 10-K"). In the opinion of the management of the Company, the accompanying unaudited interim financial statements contain all adjustments, consisting only of those of a normal recurring nature, necessary to present fairly its results of operations and cash flows for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. Certain reclassifications were made to the prior year's consolidated financial statements to conform to the current year presentation. | |||
Principles_of_Consolidation_an
Principles of Consolidation and Nature of Operations | 3 Months Ended | |
Mar. 31, 2014 | ||
Principles of Consolidation and Nature of Operations [Abstract] | ' | |
Principles of Consolidation and Nature of Operations | ' | |
-2 | Principles of Consolidation and Nature of Operations | |
DGSE Companies, Inc., a Nevada corporation, and its subsidiaries (the "Company" or "DGSE"), buy and sell jewelry and bullion products to both retail and wholesale customers throughout the United States through its facilities in Illinois, South Carolina, and Texas, and through its various internet sites. Until recently, the Company also operated retail locations in Alabama, Florida, Georgia, and Tennessee. | ||
The interim consolidated financial statements have been prepared in accordance with U.S. GAAP and include the accounts of the Company and its subsidiaries. All material intercompany transactions and balances have been eliminated. | ||
Critical_Accounting_Policies_a
Critical Accounting Policies and Estimates | 3 Months Ended |
Mar. 31, 2014 | |
Critical Accounting Policies and Estimates [Abstract] | ' |
Critical Accounting Policies and Estimates | ' |
(3) Critical Accounting Policies and Estimates | |
Income Taxes | |
The Company accounts for its position in tax uncertainties in accordance with Accounting Standards Codification ("ASC") 740, Income Taxes. The guidance establishes standards for accounting for uncertainty in income taxes. The guidance provides several clarifications related to uncertain tax positions. Most notably, a "more likely-than-not" standard for initial recognition of tax positions, a presumption of audit detection and a measurement of recognized tax benefits based on the largest amount that has a greater than 50 percent likelihood of realization. The guidance applies a two-step process to determine the amount of tax benefit to be recognized in the financial statements. First, the Company must determine whether any amount of the tax benefit may be recognized. Second, the Company determines how much of the tax benefit should be recognized (this would only apply to tax positions that qualify for recognition). The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements or the effective tax rate during the periods ended March 31, 2014 and 2013, respectively. | |
Financial Instruments | |
The carrying amounts reported in the consolidated balance sheets for cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments. The line of credit, related party does not bear a market rate of interest. Management believes that, based on the Company's situation at the time the line was negotiated, it could not have obtained comparable financing, and as such cannot estimate the fair value of the line of credit, related party. The carrying amounts reported for the Company's long-term debt, and capital leases approximate fair value because substantially all of the underlying instruments have variable interest rates, which adjust frequently, or the interest rates approximate current market rates. None of these instruments are held for trading purposes. | |
Earnings Per Share | |
Basic earnings per common share is computed by dividing net earnings available to holders of the Company's common stock by the weighted average number of common shares outstanding for the reporting period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. For the calculation of diluted earnings per share, the basic weighted average number of shares is increased by the dilutive effect of stock options outstanding determined using the treasury stock method. | |
Inventories
Inventories | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventories [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
-4 | Inventories | ||||||||
A summary of inventories is as follows: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Jewelry | $ | 9,419,397 | $ | 9,448,793 | |||||
Scrap gold | 929,537 | 1,190,490 | |||||||
Bullion | 1,032,793 | 1,199,373 | |||||||
Rare coins and Other | 840,712 | 1,083,201 | |||||||
$ | 12,222,439 | $ | 12,921,857 | ||||||
Basic_and_Diluted_Average_Shar
Basic and Diluted Average Shares | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Basic and Diluted Average Shares [Abstract] | ' | ||||||||
Basic and Diluted Average Shares | ' | ||||||||
(5) Basic and Diluted Average Shares | |||||||||
A reconciliation of basic and diluted average common shares for the three months ended March 31, 2014 and 2013 is as follows: | |||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Basic weighted average shares | 12,193,940 | 12,175,584 | |||||||
Effect of potential dilutive securities: | |||||||||
Stock options | - | 137,464 | |||||||
Diluted weighted average shares | 12,193,940 | 12,313,048 | |||||||
For the three months ended March 31, 2014 and 2013, options to purchase 5,347,500 and 5,030,000 shares of common stock, respectively, and 84,000 and 0 unvested Restricted Stock Units ("RSUs"), respectively, were not added to the diluted average shares because inclusion of such shares would be antidilutive. | |||||||||
LongTerm_Debt
Long-Term Debt | 3 Months Ended | ||||||||||||||
Mar. 31, 2014 | |||||||||||||||
Long-Term Debt [Abstract] | ' | ||||||||||||||
Long-Term Debt | ' | ||||||||||||||
(6) Long-Term Debt | |||||||||||||||
Outstanding Balance | |||||||||||||||
March 31, | December | Current | Maturity | ||||||||||||
2014 | 31, 2013 | Interest Rate | |||||||||||||
NTR line of credit (1) | $ | 2,303,359 | $ | 2,383,359 | 2 | % | 1-Aug-15 | ||||||||
Mortgage payable | 1,813,190 | 1,843,061 | 6.7 | % | 1-Aug-16 | ||||||||||
Capital leases (2) | 45,664 | 48,393 | Various | Various | |||||||||||
Sub-Total | 4,162,213 | 4,274,813 | |||||||||||||
Less: Capital leases | 11,209 | 11,091 | |||||||||||||
Less: Current maturities | 124,600 | 122,536 | |||||||||||||
Long-term debt | 4,026,404 | 4,141,186 | |||||||||||||
Less: Line of credit (1) | 2,303,359 | 2,383,359 | |||||||||||||
Long term debt, less current maturities | $ | 1,723,045 | $ | 1,757,827 | |||||||||||
-1 | On July 19, 2012, DGSE entered into a loan agreement with NTR Metals, LLC ("NTR"), an affiliate of DGSE's majority stockholder Elemetal, LLC ("Elemetal"), pursuant to which NTR, agreed to provide the Company a guidance line of revolving credit in an amount up to $7,500,000 (the "Loan Agreement"). The Loan Agreement will terminate-and all amounts outstanding thereunder will be due and payable (such amounts, the "Obligations")-upon the earlier of: (i) August 1, 2014; (ii) the date that is twelve months after the Company receives notice from NTR demanding the repayment of the Obligations; (iii) the date the Obligations are accelerated in accordance with the terms of the Loan Agreement; or (iv) the date on which the commitment terminates under the Loan Agreement. In connection with the Loan Agreement, the Company granted a security interest in the respective personal property of each of its subsidiaries. The loan carries an interest rate of two percent (2%) per annum for all funds borrowed pursuant to the Loan Agreement. Proceeds received by the Company pursuant to the terms of the Loan Agreement were used for repayment of all outstanding financial obligations incurred in connection with that certain Loan Agreement, dated as of December 22, 2005, between the Company and Texas Capital Bank, and additional proceeds are expected to be used as working capital in the ordinary course of business. The Company incurred debt issuance costs associated with the Loan Agreement totaling $56,150. The debt issuance costs are included in other assets in the accompanying consolidated balance sheet and are being amortized to interest expense on a straight-line basis over two years. As of March 31, 2014 and December 31, 2013, we had outstanding balances of $2,303,359 and $2,383,359, respectively, drawn on the NTR credit facility. On February 25, 2014, the Company and NTR entered into a one-year extension of the Loan Agreement, extending the termination date to August 1, 2015. All other terms of the agreement remain the same. | ||||||||||||||
-2 | On November 23, 2010, DGSE entered into a capital lease for $78,450 with Direct Capital Corporation for a radio-frequency identification ("RFID") inventory management solution. The non-cancelable lease agreement required an advanced payment of $5,169 and monthly payments of $2,584 for 36 months at an interest rate of 11.5% beginning in January 2011. At the end of the lease in December 2013, the equipment was purchased for $1. On April 3, 2013, DGSE entered into a capital lease for $58,563 with Graybar Financial Services for phones at the new corporate headquarters. The non-cancelable lease agreement required an advanced payment of $2,304 and monthly payments of $1,077 for 60 months at an interest rate of 4.2% beginning in May 2013. At the end of the lease in May 2018, the equipment can be purchased for $1. | ||||||||||||||
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2014 | |
Stock-Based Compensation [Abstract] | ' |
Stock-Based Compensation | ' |
(7) Stock-Based Compensation. | |
The Company accounts for share-based compensation by measuring the cost of the employee services received in exchange for an award of equity instruments, including grants of stock options, based on the fair value of the award at the date of grant. In addition, to the extent that the Company receives an excess tax benefit upon exercise of an award, such benefit is reflected as cash flow from financing activities in the consolidated statement of cash flows. | |
In January of 2014, DGSE's Board of Directors (the "Board") granted 112,000 RSUs to our officers and certain key employees. Each RSU is convertible into one share of Common Stock without additional payment pursuant to the terms of the Restricted Stock Unit Award Agreement, dated January 23, 2014, between the Issuer and each recipient (the "RSU Award Agreement"). One-fourth (or 28,000) of the RSUs vested and were exercisable as of the date of the grant, and an additional one-fourth of the RSUs (calculated using the total number of RSUs at the time of grant) vest and will be exercisable on each subsequent anniversary of the date of grant until 100 percent of the RSUs have vested, subject to the recipient's continued status as an employee on each such date and other terms and conditions of set forth in the RSU Award Agreement. Upon termination of service of the recipient to us, other than by reason of death or disability, any RSUs that have not vested will be forfeited and the award of such units shall terminate. | |
Stock-based compensation expense for the three months ended March 31, 2014 and 2013 was $60,200 and $0, respectively, relating to employee and director stock options and RSUs, and included in selling, general and administrative expenses in the accompanying consolidated statements of operations. | |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
(8) Related Party Transactions. | |
DGSE has a corporate policy governing the identification, review, consideration and approval or ratification of transactions with related persons, as that term is defined in the Instructions to Item 404(a) of Regulation S-K, promulgated under the Securities Act ("Related Party"). Under this policy, all Related Party transactions are identified and approved prior to consummation of the transaction to ensure they are consistent with DGSE's best interests and the best interests of its stockholders. Among other factors, the Board considers the size and duration of the transaction, the nature and interest of the Related Party in the transaction, whether the transaction may involve a conflict of interest and if the transaction is on terms that are at least as favorable to DGSE as would be available in a comparable transaction with an unaffiliated third party. DGSE's Board reviews all Related Party transactions at least annually to determine if it is in DGSE's best interests and the best interests of our stockholders to continue, modify, or terminate the Related Party transactions. DGSE's Related Party Transaction Policy is available for review in its entirety under the "Investor Relations" menu of our corporate website at www.DGSECompanies.com. | |
Elemetal is DGSE's largest stockholder. Elemetal, through its affiliates NTR and Elemetal Capital, is also DGSE's primary refiner and bullion trading partner. For the three months ended March 31, 2014, 28% of sales and 30% of purchases were transactions with Elemetal, and in the same period in 2013 these transactions represented 32% of DGSE's sales and 39% of our purchases. As of March 31, 2014 and December 31, 2013, we were obligated to pay $3,727,916 and $3,332,858, respectively, to Elemetal as a trade payable. DGSE also paid Elemetal and its affiliates $54,813 in interest for the three months ended March 31, 2014, including interest on DGSE's trade payable with Elemetal. In the same period in 2013 DGSE recognized $17,671 in interest related to Elemetal and its affiliates. | |
On July 19, 2012, the Company entered into the Loan Agreement with NTR, pursuant to which NTR agreed to provide the Company with a guidance line of revolving credit in an amount up to $7,500,000. The Loan Agreement provides that the Loan Agreement will terminate-and DGSE's Obligations will be due and payable- upon the earlier of (i) August 1, 2014, (ii) the date that is twelve months after DGSE receives notice from NTR demanding the repayment of the Obligations, (iii) the date the Obligations are accelerated in accordance with the terms of the Loan Agreement or (iv) the date on which the commitment terminates under the Loan Agreement. In connection with the Loan Agreement, DGSE granted a security interest in the respective personal property of each of its subsidiaries. The loan carries an interest rate of two percent (2%) per annum for all funds borrowed pursuant to the Loan Agreement. Proceeds received by DGSE pursuant to the terms of the Loan Agreement were used for repayment of all outstanding financial obligations incurred in connection with that certain Loan Agreement, dated as of December 22, 2005, between DGSE and Texas Capital Bank, N.A., and any additional proceeds are expected to be used as working capital in the ordinary course of business. As of March 31, 2014 and December 31, 2013, we had outstanding balances of $2,303,359 and $2,383,359, respectively, drawn on the NTR credit facility. On February 25, 2014, the Company and NTR entered into a one-year extension of the Loan Agreement, extending the termination date to August 1, 2015. All other terms of the agreement remain the same. | |
Estate Gold and Silver, LLC, a Texas limited liability company ("Estate Gold") was 25% owned by an entity owned by James Vierling, DGSE's former Chief Executive Officer and Chairman, and operated five stores in Oklahoma, primarily focused on buying gold, but also engaging in retail sales of jewelry and bullion. In July of 2013, Estate Gold ceased all operations. The Company previously had an agreement with Estate Gold to provide operations management services, consisting of: (i) the receipt, inventorying, and re-sale of Estate Gold purchases; (ii) the management of Estate Gold's payroll, insurance, accounts payable and receivable; (iii) the maintenance of and updates to Estate Gold's business software; maintenance of the Estate Gold website; and (iv) financial reporting of Estate Gold to its owners. The Company also periodically engaged in the purchase or sale of jewelry, bullion and diamonds to Estate Gold, from time to time in the normal course of business. DGSE had no transactions with Estate Gold in the three months ended March 31, 2014. During the three months ended March 31, 2013, the Company received $16,641 in fees for services, sold $8,214 in products, and purchased $23,342 in products, in transactions with Estate Gold. | |
Legal_Proceedings
Legal Proceedings | 3 Months Ended |
Mar. 31, 2014 | |
Legal Proceedings [Abstract] | ' |
Legal Proceedings | ' |
(9) Legal Proceedings. | |
On April 16, 2012, the Company filed a Current Report on Form 8-K disclosing that DGSE's Board had determined the existence of the certain accounting irregularities beginning approximately during the second calendar quarter of 2007 and continuing in periods subsequent thereto (the "Accounting Irregularities"), which could affect financial information reported since that time. On April 16, 2012, the Company also announced that it had engaged forensic accountants to analyze the Accounting Irregularities, and that financial statements and information reported since the inception of the Accounting Irregularities, believed to begin in the second calendar quarter of 2007, should not be relied upon. The Company brought the Accounting Irregularities to the attention of the SEC in a letter dated April 16, 2012. On June 18, 2012, the Company received written notice that the SEC had initiated a private investigation into the Accounting Irregularities, to determine whether any persons or entities had engaged in any possible violations of the federal securities laws. The Company has cooperated fully, and continues to cooperate fully, with the SEC staff in the investigation. This investigation is still pending as of the date of the filing of this Form 10-Q, and there can be no certainty as to the outcome of this investigation, or to the findings of the SEC. | |
In connection with the Accounting Irregularities, and the subsequent halt in trading of DGSE's Common Stock on the Exchange, the Company settled two lawsuits in Fiscal 2013. The first, Civil Action No. 3:12-cv-3664, was filed in the United States District Court for the Northern District of Texas, on September 7, 2012, entitled Grant Barfuss, on behalf of himself and all others similarly situated vs. DGSE Companies, Inc.; L.S. Smith, John Benson and William Oyster. This complaint alleged violations of the securities laws and sought unspecified damages. Plaintiffs alleged that certain public filings in 2010 and 2011 were false and misleading. The second suit, Case No. 3:12-cv-03850 in the United States District Court for the Northern District of Texas, was filed on September 21, 2012, by Jason Farmer and entitled Jason Farmer, Derivatively on Behalf of Nominal Defendant DGSE Companies, Inc., Plaintiff, v. William H. Oyster, James D. Clem, William Cordeiro, Craig Alan-Lee, David Rector, L.S. Smith, and John Benson, Defendants, and DGSE Companies, Inc., Nominal Defendant. This suit was filed against DGSE, as a nominal defendant, and against certain and former officers and directors. The plaintiff asserted that certain statements made in DGSE's proxy materials were false and misleading, that the defendants breached fiduciary duties owed to DGSE, for abuse of control, and sought unspecified compensatory and exemplary damages, along with certain corporate governance changes, for the benefit of DGSE. | |
The approved settlement resolved all issues which were pending before the United States District Court for the Northern District of Texas in both cases. The defendants agreed to pay $2 million to resolve all claims in both suits (including obligations to pay plaintiffs' attorneys' fees). The Company also incurred its own attorneys' fees and expenses associated with finalizing the settlement. While the majority of the total settlement amount and related expenses were paid from insurance proceeds, the Company incurred approximately $314,000 in Fiscal 2013 in relation to these suits. | |
In the quarter ended March 31, 2014, the Company settled a civil suit filed in the County Court for Dallas County, Texas, Cause No. CC-13-02999-C entitled Joseph C. Osterman, T.G. Herron, and, Jean K. Herron, Plaintiffs, vs. DGSE Companies, Inc. d/b/a Dallas Gold & Silver Exchange, Defendants. The complaint alleged amounts owed and due to the plaintiffs by the defendant in relation to a variety of promissory notes allegedly issued between 2001 and 2006 by the defendant. Pursuant to the confidential settlement agreement, which admits no liability on the part of the defendant, the Company has resolved all claims with plaintiff Osterman to the parties' mutual satisfaction. Discussions with plaintiffs Heron are ongoing, and the final outcome of these discussions is uncertain, although any conclusion to this suit is not expected to be material to the Company's results in the year ended December 31, 2014 ("Fiscal 2014"). | |
The Texas Comptroller conducted a sales and use tax audit of our operations in Texas with respect to the period March 1, 2006 through November 30, 2009 and subsequently sent a Notification of Audit Results, by letter dated December 17, 2010, asserting that DGSE owes an amount of tax due, plus penalties and interest. The Company submitted a request for redetermination to the Texas Comptroller by letter dated January 13, 2011. By letter dated August 25, 2011, the Texas Comptroller stated that DGSE's request for a redetermination hearing has been granted. No hearing has taken place, but the Company has been actively engaged in discussions with the Texas Comptroller's office. The Company has reached an informal agreement on certain issues with the attorney representing the Texas Comptroller in the administrative hearing with respect to this liability, while other issues remain under discussion. Although no final determination has been reached, based on the most recent communication from the Texas Comptroller in February of 2014, DGSE believes that it is likely that the Company owes additional taxes, interest and penalty to the State of Texas, and accordingly reserved an additional $775,000 in Fiscal 2013 towards the payment of these amounts. The total reserve in this matter now is approximately $1.1 million, and is based on the Company's current best estimate, which may vary materially from any final assessment. | |
Discontinued_Operations
Discontinued Operations | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Discontinued Operations [Abstract] | ' | ||||||||
Discontinued Operations | ' | ||||||||
(10) Discontinued Operations | |||||||||
In January of 2014, the Company elected to discontinue the operations of six of its Southern Bullion Coin and Jewelry ("Southern Bullion") locations due to the lack of profitability and management's belief that it was unlikely that profitability would be reached in the foreseeable future. The Company officially discontinued these operations on February 3, 2014, and the operating results for these six locations for the three months ended March 31, 2014 and 2013 have been reclassified as discontinued operations in the consolidated statements of operations as detailed in the table below. | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Revenue: | |||||||||
Sales | $ | 914,497 | $ | 1,291,573 | |||||
Cost of sales | 819,731 | 980,445 | |||||||
Gross margin | 94,766 | 311,128 | |||||||
Expenses: | |||||||||
S,G&A expense | 132,406 | 348,493 | |||||||
Depreciation and amortization | - | - | |||||||
Total Expenses | 132,406 | 348,493 | |||||||
Operating loss | (37,640 | ) | (37,365 | ) | |||||
Other expense (income): | |||||||||
Other (expense)/income, net | - | - | |||||||
Interest expense | - | - | |||||||
- | - | ||||||||
Loss from discontinued operations before income taxes | (37,640 | ) | (37,365 | ) | |||||
Income tax expense | - | - | |||||||
Loss from discontinued operations after income taxes | $ | (37,640 | ) | $ | (37,365 | ) | |||
Subsequent to the end of the first fiscal quarter of 2014, in April of 2014 the Company elected to discontinue the operations of all 17 remaining Southern Bullion locations. During 2013, the Southern Bullion operations generated a net loss of approximately $1.9 million. These operations represented approximately 20% the Company's revenue, and approximately 70% of the Company's operating loss in Fiscal 2013. The significant change in the precious metal markets, including a 30% decline in the spot price of gold since the acquisition of Southern Bullion in 2011, had a disproportionately negative impact on the customer traffic, transactional volume and profitability of the Southern Bullion operations. The Company officially discontinued these operations on or about April 19, 2014. The operating results for all Southern Bullion locations are expected to be reclassified as discontinued operations in the consolidated statements of operations beginning with the quarter ending June 30, 2014. | |||||||||
The Company expects to report approximately $3.7 million in 2014 in non-recurring charges related to these closures. This includes approximately $2.9 million in expected write-offs related to the Southern Bullion trade name, approximately $400,000 in expected fixed asset write-downs, and approximately $500,000 in expected lease termination expenses, severance payments and other related costs. | |||||||||
Critical_Accounting_Policies_a1
Critical Accounting Policies and Estimates (Policy) | 3 Months Ended |
Mar. 31, 2014 | |
Critical Accounting Policies and Estimates [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
The Company accounts for its position in tax uncertainties in accordance with Accounting Standards Codification ("ASC") 740, Income Taxes. The guidance establishes standards for accounting for uncertainty in income taxes. The guidance provides several clarifications related to uncertain tax positions. Most notably, a "more likely-than-not" standard for initial recognition of tax positions, a presumption of audit detection and a measurement of recognized tax benefits based on the largest amount that has a greater than 50 percent likelihood of realization. The guidance applies a two-step process to determine the amount of tax benefit to be recognized in the financial statements. First, the Company must determine whether any amount of the tax benefit may be recognized. Second, the Company determines how much of the tax benefit should be recognized (this would only apply to tax positions that qualify for recognition). The Company has not taken a tax position that, if challenged, would have a material effect on the financial statements or the effective tax rate during the periods ended March 31, 2014 and 2013, respectively. | |
Financial Instruments | ' |
Financial Instruments | |
The carrying amounts reported in the consolidated balance sheets for cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value because of the immediate or short-term maturity of these financial instruments. The line of credit, related party does not bear a market rate of interest. Management believes that, based on the Company's situation at the time the line was negotiated, it could not have obtained comparable financing, and as such cannot estimate the fair value of the line of credit, related party. The carrying amounts reported for the Company's long-term debt, and capital leases approximate fair value because substantially all of the underlying instruments have variable interest rates, which adjust frequently, or the interest rates approximate current market rates. None of these instruments are held for trading purposes. | |
Earnings Per Share | ' |
Earnings Per Share | |
Basic earnings per common share is computed by dividing net earnings available to holders of the Company's common stock by the weighted average number of common shares outstanding for the reporting period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. For the calculation of diluted earnings per share, the basic weighted average number of shares is increased by the dilutive effect of stock options outstanding determined using the treasury stock method. | |
Inventories_Tables
Inventories (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Inventories [Abstract] | ' | ||||||||
Schedule of Inventories | ' | ||||||||
A summary of inventories is as follows: | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Jewelry | $ | 9,419,397 | $ | 9,448,793 | |||||
Scrap gold | 929,537 | 1,190,490 | |||||||
Bullion | 1,032,793 | 1,199,373 | |||||||
Rare coins and Other | 840,712 | 1,083,201 | |||||||
$ | 12,222,439 | $ | 12,921,857 | ||||||
Basic_and_Diluted_Average_Shar1
Basic and Diluted Average Shares (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Basic and Diluted Average Shares [Abstract] | ' | ||||||||
Schedule of Reconciliation of Basic and Diluted Average Common Shares | ' | ||||||||
A reconciliation of basic and diluted average common shares for the three months ended March 31, 2014 and 2013 is as follows: | |||||||||
For the Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Basic weighted average shares | 12,193,940 | 12,175,584 | |||||||
Effect of potential dilutive securities: | |||||||||
Stock options | - | 137,464 | |||||||
Diluted weighted average shares | 12,193,940 | 12,313,048 | |||||||
LongTerm_Debt_Tables
Long-Term Debt (Tables) | 3 Months Ended | ||||||||||||||
Mar. 31, 2014 | |||||||||||||||
Long-Term Debt [Abstract] | ' | ||||||||||||||
Schedule of Long-Term Debt | ' | ||||||||||||||
Outstanding Balance | |||||||||||||||
March 31, | December | Current | Maturity | ||||||||||||
2014 | 31, 2013 | Interest Rate | |||||||||||||
NTR line of credit (1) | $ | 2,303,359 | $ | 2,383,359 | 2 | % | 1-Aug-15 | ||||||||
Mortgage payable | 1,813,190 | 1,843,061 | 6.7 | % | 1-Aug-16 | ||||||||||
Capital leases (2) | 45,664 | 48,393 | Various | Various | |||||||||||
Sub-Total | 4,162,213 | 4,274,813 | |||||||||||||
Less: Capital leases | 11,209 | 11,091 | |||||||||||||
Less: Current maturities | 124,600 | 122,536 | |||||||||||||
Long-term debt | 4,026,404 | 4,141,186 | |||||||||||||
Less: Line of credit (1) | 2,303,359 | 2,383,359 | |||||||||||||
Long term debt, less current maturities | $ | 1,723,045 | $ | 1,757,827 | |||||||||||
-1 | On July 19, 2012, DGSE entered into a loan agreement with NTR Metals, LLC ("NTR"), an affiliate of DGSE's majority stockholder Elemetal, LLC ("Elemetal"), pursuant to which NTR, agreed to provide the Company a guidance line of revolving credit in an amount up to $7,500,000 (the "Loan Agreement"). The Loan Agreement will terminate-and all amounts outstanding thereunder will be due and payable (such amounts, the "Obligations")-upon the earlier of: (i) August 1, 2014; (ii) the date that is twelve months after the Company receives notice from NTR demanding the repayment of the Obligations; (iii) the date the Obligations are accelerated in accordance with the terms of the Loan Agreement; or (iv) the date on which the commitment terminates under the Loan Agreement. In connection with the Loan Agreement, the Company granted a security interest in the respective personal property of each of its subsidiaries. The loan carries an interest rate of two percent (2%) per annum for all funds borrowed pursuant to the Loan Agreement. Proceeds received by the Company pursuant to the terms of the Loan Agreement were used for repayment of all outstanding financial obligations incurred in connection with that certain Loan Agreement, dated as of December 22, 2005, between the Company and Texas Capital Bank, and additional proceeds are expected to be used as working capital in the ordinary course of business. The Company incurred debt issuance costs associated with the Loan Agreement totaling $56,150. The debt issuance costs are included in other assets in the accompanying consolidated balance sheet and are being amortized to interest expense on a straight-line basis over two years. As of March 31, 2014 and December 31, 2013, we had outstanding balances of $2,303,359 and $2,383,359, respectively, drawn on the NTR credit facility. On February 25, 2014, the Company and NTR entered into a one-year extension of the Loan Agreement, extending the termination date to August 1, 2015. All other terms of the agreement remain the same. | ||||||||||||||
-2 | On November 23, 2010, DGSE entered into a capital lease for $78,450 with Direct Capital Corporation for a radio-frequency identification ("RFID") inventory management solution. The non-cancelable lease agreement required an advanced payment of $5,169 and monthly payments of $2,584 for 36 months at an interest rate of 11.5% beginning in January 2011. At the end of the lease in December 2013, the equipment was purchased for $1. On April 3, 2013, DGSE entered into a capital lease for $58,563 with Graybar Financial Services for phones at the new corporate headquarters. The non-cancelable lease agreement required an advanced payment of $2,304 and monthly payments of $1,077 for 60 months at an interest rate of 4.2% beginning in May 2013. At the end of the lease in May 2018, the equipment can be purchased for $1. | ||||||||||||||
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Discontinued Operations [Abstract] | ' | ||||||||
Schedule of Discontinued Operations | ' | ||||||||
The Company officially discontinued these operations on February 3, 2014, and the operating results for these six locations for the three months ended March 31, 2014 and 2013 have been reclassified as discontinued operations in the consolidated statements of operations as detailed in the table below. | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Revenue: | |||||||||
Sales | $ | 914,497 | $ | 1,291,573 | |||||
Cost of sales | 819,731 | 980,445 | |||||||
Gross margin | 94,766 | 311,128 | |||||||
Expenses: | |||||||||
S,G&A expense | 132,406 | 348,493 | |||||||
Depreciation and amortization | - | - | |||||||
Total Expenses | 132,406 | 348,493 | |||||||
Operating loss | (37,640 | ) | (37,365 | ) | |||||
Other expense (income): | |||||||||
Other (expense)/income, net | - | - | |||||||
Interest expense | - | - | |||||||
- | - | ||||||||
Loss from discontinued operations before income taxes | (37,640 | ) | (37,365 | ) | |||||
Income tax expense | - | - | |||||||
Loss from discontinued operations after income taxes | $ | (37,640 | ) | $ | (37,365 | ) | |||
Inventories_Details
Inventories (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Inventories [Abstract] | ' | ' |
Jewelry | $9,419,397 | $9,448,793 |
Scrap gold | 929,537 | 1,190,490 |
Bullion | 1,032,793 | 1,199,373 |
Rare coins | 840,712 | 1,083,201 |
Total | $12,222,439 | $12,921,857 |
Basic_and_Diluted_Average_Shar2
Basic and Diluted Average Shares (Narrative) (Details) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Stock Options [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Anti-dilutive securities excluded from the denominator in the computation of earnings per share | 5,347,500 | 5,030,000 |
Unvested Restricted Stock Units ("RSUs") [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Anti-dilutive securities excluded from the denominator in the computation of earnings per share | 84,000 | 0 |
Basic_and_Diluted_Average_Shar3
Basic and Diluted Average Shares (Reconciliation of Basic Earnings per Common Share and Diluted Earnings Per Common Share) (Details) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Basic and Diluted Average Shares [Abstract] | ' | ' |
Basic weighted average shares | 12,193,940 | 12,175,584 |
Effect of potential dilutive securities: Stock options | ' | 137,464 |
Diluted weighted average shares | 12,193,940 | 12,313,048 |
LongTerm_Debt_Schedule_of_Debt
Long-Term Debt (Schedule of Debt) (Details) (USD $) | 3 Months Ended | |||
Mar. 31, 2014 | Dec. 31, 2013 | |||
Debt Instrument [Line Items] | ' | ' | ||
Sub-Total | $4,162,213 | $4,274,813 | ||
Less: Capital leases | 11,209 | 11,091 | ||
Less: Current maturities | 124,600 | 122,536 | ||
Long-term debt | 4,026,404 | 4,141,186 | ||
Less: Line of credit | 2,303,359 | [1] | 2,383,359 | [1] |
Long-term debt, less current maturities | 1,723,045 | 1,757,827 | ||
NTR line of credit [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Sub-Total | 2,303,359 | [1] | 2,383,359 | [1] |
Current Interest Rate | 2.00% | ' | ||
Maturity | 1-Aug-15 | ' | ||
Mortgage payable [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Sub-Total | 1,813,190 | 1,843,061 | ||
Current Interest Rate | 6.70% | ' | ||
Maturity | 1-Aug-16 | ' | ||
Capital leases [Member] | ' | ' | ||
Debt Instrument [Line Items] | ' | ' | ||
Sub-Total | $45,664 | [2] | $48,393 | [2] |
[1] | On July 19, 2012, DGSE entered into a loan agreement with NTR Metals, LLC ("NTR"), an affiliate of DGSE's majority stockholder Elemetal, LLC ("Elemetal"), pursuant to which NTR, agreed to provide the Company a guidance line of revolving credit in an amount up to $7,500,000 (the "Loan Agreement"). The Loan Agreement will terminate-and all amounts outstanding thereunder will be due and payable (such amounts, the "Obligations")-upon the earlier of: (i) August 1, 2014; (ii) the date that is twelve months after the Company receives notice from NTR demanding the repayment of the Obligations; (iii) the date the Obligations are accelerated in accordance with the terms of the Loan Agreement; or (iv) the date on which the commitment terminates under the Loan Agreement. In connection with the Loan Agreement, the Company granted a security interest in the respective personal property of each of its subsidiaries. The loan carries an interest rate of two percent (2%) per annum for all funds borrowed pursuant to the Loan Agreement. Proceeds received by the Company pursuant to the terms of the Loan Agreement were used for repayment of all outstanding financial obligations incurred in connection with that certain Loan Agreement, dated as of December 22, 2005, between the Company and Texas Capital Bank, and additional proceeds are expected to be used as working capital in the ordinary course of business. The Company incurred debt issuance costs associated with the Loan Agreement totaling $56,150. The debt issuance costs are included in other assets in the accompanying consolidated balance sheet and are being amortized to interest expense on a straight-line basis over two years. As of March 31, 2014 and December 31, 2013, we had outstanding balances of $2,303,359 and $2,383,359, respectively, drawn on the NTR credit facility. On February 25, 2014, the Company and NTR entered into a one-year extension of the Loan Agreement, extending the termination date to August 1, 2015. All other terms of the agreement remain the same. | |||
[2] | On November 23, 2010, DGSE entered into a capital lease for $78,450 with Direct Capital Corporation for a radio-frequency identification ("RFID") inventory management solution. The non-cancelable lease agreement required an advanced payment of $5,169 and monthly payments of $2,584 for 36 months at an interest rate of 11.5% beginning in January 2011. At the end of the lease in December 2013, the equipment was purchased for $1. On April 3, 2013, DGSE entered into a capital lease for $58,563 with Graybar Financial Services for phones at the new corporate headquarters. The non-cancelable lease agreement required an advanced payment of $2,304 and monthly payments of $1,077 for 60 months at an interest rate of 4.2% beginning in May 2013. At the end of the lease in May 2018, the equipment can be purchased for $1. |
LongTerm_Debt_Footnotes_Detail
Long-Term Debt (Footnotes) (Details) (USD $) | 1 Months Ended | 3 Months Ended | ||
Feb. 25, 2014 | Jul. 19, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | |
NTR Loan Agreement [Member] | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Issuance date | ' | ' | 19-Jul-12 | ' |
Credit facility amount, maximum | ' | ' | $7,500,000 | ' |
Maturity | 1-Aug-15 | 1-Aug-14 | 1-Aug-15 | ' |
Interest rate, credit | ' | ' | 2.00% | ' |
Debt issuance costs | ' | 56,150 | ' | ' |
Outstanding balance of credit facility | ' | ' | 2,303,359 | 2,383,359 |
Direct Capital Corporation lease [Member] | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Issuance date | ' | ' | 23-Nov-10 | ' |
Debt instrument, face amount | ' | ' | 78,450 | ' |
Advances on capital leases | ' | ' | 5,169 | ' |
Monthly payments | ' | ' | 2,584 | ' |
Term | ' | ' | '36 months | ' |
Interest rate, debt | ' | ' | 11.50% | ' |
Equipment purchase option, purchase price | ' | ' | 1 | ' |
Graybar Financial Services lease [Member] | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Issuance date | ' | ' | 3-Apr-13 | ' |
Debt instrument, face amount | ' | ' | 58,563 | ' |
Advances on capital leases | ' | ' | 2,304 | ' |
Monthly payments | ' | ' | 1,077 | ' |
Term | ' | ' | '60 months | ' |
Interest rate, debt | ' | ' | 4.20% | ' |
Equipment purchase option, purchase price | ' | ' | $1 | ' |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 1 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | Jan. 31, 2014 | |
RSUs [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Units granted | ' | ' | 112,000 |
Units vested | ' | ' | 28,000 |
Stock-based compensation expense | $60,200 | $0 | ' |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 3 Months Ended | 3 Months Ended | ||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Feb. 25, 2014 | Jul. 19, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | |
NTR Loan Agreement [Member] | NTR Loan Agreement [Member] | NTR Loan Agreement [Member] | NTR Loan Agreement [Member] | Elemental [Member] | Elemental [Member] | Elemental [Member] | Elemental [Member] | Elemental [Member] | Elemental [Member] | Estate Gold [Member] | |||
Sales [Member] | Sales [Member] | Purchases [Member] | Purchases [Member] | ||||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Concentration risk, percentage | ' | ' | ' | ' | ' | ' | ' | ' | 28.00% | 32.00% | 30.00% | 39.00% | ' |
Due to related party | ' | ' | ' | ' | ' | ' | $3,727,916 | $3,332,858 | ' | ' | ' | ' | ' |
Interest paid | 69,344 | 40,390 | ' | ' | ' | ' | 54,813 | ' | ' | ' | ' | ' | ' |
Interest recognized | ' | ' | ' | ' | ' | ' | 17,671 | ' | ' | ' | ' | ' | ' |
Issuance date | ' | ' | ' | ' | 19-Jul-12 | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility amount, maximum | ' | ' | ' | ' | 7,500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate, credit | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity | ' | ' | 1-Aug-15 | 1-Aug-14 | 1-Aug-15 | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding balance of credit facility | ' | ' | ' | ' | 2,303,359 | 2,383,359 | ' | ' | ' | ' | ' | ' | ' |
Percentage of ownership | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25.00% |
Proceeds from fees and services from related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,641 |
Related party revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,214 |
Purchases from related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $23,342 |
Legal_Proceedings_Details
Legal Proceedings (Details) (USD $) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2014 | Dec. 31, 2013 | |
Legal Proceedings [Abstract] | ' | ' |
Litigation settlement amount | $2,000,000 | ' |
Litigation expenses | ' | 314,000 |
Amount reserved for litigation during period | ' | 775,000 |
Accrued litigation settlement | $1,100,000 | ' |
Discontinued_Operations_Narrat
Discontinued Operations (Narrative) (Details) (USD $) | 3 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | |||
Mar. 31, 2014 | Mar. 31, 2013 | Apr. 30, 2014 | Dec. 31, 2013 | Apr. 30, 2014 | Apr. 30, 2014 | Apr. 30, 2014 | |
Southern Bullion [Member] | Southern Bullion [Member] | Southern Bullion [Member] | Southern Bullion [Member] | Southern Bullion [Member] | |||
Trade name [Member] | Fixed-assets [Member] | Lease termination expenses, severance payments and other related costs [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Net loss | ($522,978) | $300,412 | ' | ($1,900,000) | ' | ' | ' |
Expected non-recurring charges related to closures | ' | ' | $3,700,000 | ' | $2,900,000 | $400,000 | $500,000 |
Discontinued_Operations_Schedu
Discontinued Operations (Schedule of Discontinued Operations) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
S,G&A expense | $4,657,542 | $4,675,006 |
Other (expense)/income, net | 31,261 | 12,147 |
Total other expense (income) | -53,301 | -39,557 |
Loss from discontinued operations after income taxes | -37,640 | -37,365 |
Southern Bullion [Member] | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Sales | 914,497 | 1,291,573 |
Cost of sales | 819,731 | 980,445 |
Gross margin | 94,766 | 311,128 |
S,G&A expense | 132,406 | 348,493 |
Depreciation and amortization | ' | ' |
Total expenses | 132,406 | 348,493 |
Operating loss | -37,640 | -37,365 |
Other (expense)/income, net | ' | ' |
Interest expense | ' | ' |
Total other expense (income) | ' | ' |
Loss from discontinued operations before income taxes | -37,640 | -37,365 |
Income tax expense | ' | ' |
Loss from discontinued operations after income taxes | ($37,640) | ($37,365) |