Document and Entity Information
Document and Entity Information | 6 Months Ended |
Aug. 31, 2017shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Aug. 31, 2017 |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q2 |
Trading Symbol | VIDE |
Entity Registrant Name | VIDEO DISPLAY CORP |
Entity Central Index Key | 758,743 |
Current Fiscal Year End Date | --02-28 |
Entity Filer Category | Smaller Reporting Company |
Entity Common Stock, Shares Outstanding | 5,890,748 |
Interim Condensed Consolidated
Interim Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Current assets | ||
Cash and cash equivalents | $ 205 | $ 135 |
Trading investments, at fair value | 363 | 368 |
Accounts receivable, less allowance for doubtful accounts of $22 and $20 | 1,625 | 2,771 |
Note receivable to officers and directors | 183 | 175 |
Inventories, net | 4,659 | 5,838 |
Prepaid expenses and other | 173 | 246 |
Total current assets | 7,208 | 9,533 |
Property, plant, and equipment | ||
Land | 154 | 154 |
Buildings | 2,717 | 2,712 |
Machinery and equipment | 5,881 | 5,539 |
Total property, plant and equipment | 8,752 | 8,405 |
Accumulated depreciation and amortization | (7,246) | (7,124) |
Net property, plant, and equipment | 1,506 | 1,281 |
Note receivable | 496 | 590 |
Investment in LLC | 500 | |
Other assets | 26 | 26 |
Total assets | 9,736 | 11,430 |
Current liabilities | ||
Accounts payable | 584 | 1,397 |
Accrued liabilities | 807 | 834 |
Current maturities of long-term debt | 55 | 54 |
Customer deposits | 121 | 418 |
Notes payable to officers and directors | 183 | 175 |
Line of credit | 301 | 237 |
Income taxes payable | 10 | |
Total current liabilities | 2,051 | 3,125 |
Long-term debt, less current maturities | 50 | 77 |
Notes payable to officers and directors | 496 | 590 |
Deferred rent | 120 | 180 |
Total liabilities | 2,717 | 3,972 |
Shareholders' Equity | ||
Preferred stock, no par value - 10,000 shares authorized; none issued and outstanding | ||
Common stock, no par value - 50,000 shares authorized; 9,732 issued and 5,891 outstanding at August 31, 2017 and February 28, 2017 | 7,293 | 7,293 |
Additional paid-in capital | 234 | 186 |
Retained earnings | 15,760 | 16,247 |
Treasury stock, shares at cost; 3,841 at August 31, 2017 and February 28, 2017 | (16,268) | (16,268) |
Total shareholders' equity | 7,019 | 7,458 |
Total liabilities and shareholders' equity | $ 9,736 | $ 11,430 |
Interim Condensed Consolidated3
Interim Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Accounts receivable, allowance for doubtful accounts | $ 22 | $ 20 |
Preferred stock, par value | ||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | ||
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 9,732,000 | 9,732,000 |
Common stock, shares outstanding | 5,891,000 | 5,891,000 |
Treasury stock, shares | 3,841,000 | 3,841,000 |
Interim Condensed Consolidated4
Interim Condensed Consolidated Income Statements - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2017 | Aug. 31, 2016 | Aug. 31, 2017 | Aug. 31, 2016 | |
Net sales | $ 3,161 | $ 3,632 | $ 7,058 | $ 7,342 |
Cost of goods sold | 2,683 | 3,042 | 5,983 | 6,336 |
Gross profit | 478 | 590 | 1,075 | 1,006 |
Operating expenses | ||||
Selling and delivery | 226 | 216 | 469 | 448 |
General and administrative | 797 | 879 | 1,677 | 1,708 |
Operating Expenses, Total | 1,023 | 1,095 | 2,146 | 2,156 |
Operating loss | (545) | (505) | (1,071) | (1,150) |
Other income (expense) | ||||
Interest income/ (expense) | (4) | (3) | (8) | |
Investment income/(loss) | (7) | 139 | (6) | 188 |
Other, net | 333 | (5) | 603 | 206 |
Nonoperating Income (Expense), Total | 322 | 131 | 589 | 394 |
Income (loss) before income taxes | (223) | (374) | (482) | (756) |
Income tax expense (benefit) | (2) | 4 | 5 | 14 |
Net income (loss) | $ (221) | $ (378) | $ (487) | $ (770) |
Net income (loss) per share: | ||||
Net loss per share-basic | $ (0.04) | $ (0.06) | $ (0.08) | $ (0.13) |
Net loss per share-diluted | $ (0.04) | $ (0.06) | $ (0.08) | $ (0.13) |
Basic weighted average shares outstanding | 5,891 | 5,891 | 5,891 | 5,891 |
Diluted weighted average shares outstanding | 5,891 | 5,891 | 5,891 | 5,891 |
Interim Condensed Consolidated5
Interim Condensed Consolidated Statement of Shareholders' Equity - 6 months ended Aug. 31, 2017 - USD ($) shares in Thousands, $ in Thousands | Total | Common Shares | Additional Paid-in Capital | Retained Earnings | Treasury Stock | |
Balance (in shares) at Feb. 28, 2017 | [1] | 5,891 | ||||
Balance at Feb. 28, 2017 | $ 7,458 | $ 7,293 | $ 186 | $ 16,247 | $ (16,268) | |
Net loss | (487) | (487) | ||||
Share based compensation | 48 | |||||
Balance (in shares) at Aug. 31, 2017 | [1] | 5,891 | ||||
Balance at Aug. 31, 2017 | $ 7,019 | $ 7,293 | $ 234 | $ 15,760 | $ (16,268) | |
[1] | Common shares are shown net of treasury shares. |
Interim Condensed Consolidated6
Interim Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 31, 2017 | Aug. 31, 2016 | |
Operating Activities | ||
Net loss | $ (487) | $ (770) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 119 | 119 |
Provision for doubtful accounts | 3 | 8 |
Provision for inventory reserve | 113 | 213 |
Non-cash charge for share based compensation | 48 | 3 |
Deferred rental income | (60) | (60) |
Realized gain on investments | 5 | (178) |
Changes in working capital items: | ||
Accounts receivable | 1,144 | (1,055) |
Note receivable | 85 | 81 |
Inventories | 1,066 | 297 |
Prepaid expenses and other assets | 73 | (1,516) |
Customer deposits | (297) | 1,569 |
Accounts payable and accrued liabilities | (851) | 766 |
Cost, estimated earnings and billings on uncompleted contracts | (160) | |
Income taxes refundable/payable | 8 | |
Net cash provided by (used in) operating activities | 961 | (675) |
Investing Activities | ||
Capital expenditures | (343) | (152) |
Purchases of investments | (1,153) | (596) |
Investment in LLC | (500) | |
Sales of investments | 1,121 | 793 |
Net cash provided by (used in) investing activities | (875) | 45 |
Financing Activities | ||
Proceeds from related party loans | 846 | |
Repayment of loans from related parties | (85) | (85) |
Proceeds/ repayments of line of credit and long-term debt | 37 | (25) |
Proceeds on marginal float | 32 | (202) |
Net cash provided by (used in) financing activities | (16) | 534 |
Net change in cash and cash equivalents | 70 | (96) |
Cash and cash equivalents, beginning of year | 135 | 595 |
Cash and cash equivalents, end of period | $ 205 | $ 499 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Aug. 31, 2017 | |
Summary of Significant Accounting Policies | Note 1. – Summary of Significant Accounting Policies The interim condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries after elimination of all significant intercompany accounts and transactions. As contemplated by the Securities and Exchange Commission (the “SEC” or “Commission”) instructions to Form 10-Q, the following footnotes have been condensed and, therefore, do not contain all disclosures required in connection with annual consolidated financial statements. Reference should be made to the Company’s year-end consolidated financial statements and notes thereto, including a description of the accounting policies followed by the Company, contained in its Annual Report on Form 10-K as of and for the fiscal year ended February 28, 2017, as filed with the Commission. There are no material changes in accounting policy during the six months ended August 31, 2017. The consolidated financial information included in this report has been prepared by the Company, without audit. In the opinion of management, the interim condensed consolidated financial information included in this report contains all adjustments (all of which are normal and recurring) necessary for a fair presentation of the results for the interim periods. Nevertheless, the results shown for interim periods are not necessarily indicative of results to be expected for the full year. The February 28, 2017 consolidated balance sheet data was derived from the audited consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (U.S. GAAP). |
Financial Condition and Going C
Financial Condition and Going Concern | 6 Months Ended |
Aug. 31, 2017 | |
Financial Condition and Going Concern | Note 2. – Financial Condition and Going Concern The accompanying interim condensed consolidated financial statements were prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has sustained losses for each of the last three years and has seen a decline in both its working capital and liquid assets during this time. Losses over this time are due to a combination of decreasing revenues across all divisions without a commensurate reduction of expenses. The Company’s working capital and liquid asset position are presented below (in thousands) as of August 31, 2017 and February 28, 2017: August 31, 2017 February 28, Working capital $ 5,157 $ 6,408 Liquid assets $ 568 $ 503 Management has implemented a plan to improve the liquidity of the Company. The Company has been fulfilling a plan to increase revenues at all the divisions, each structured to the particular division which has resulted with an increase in the current backlog. Operating costs decreased during the quarter ended August 31, 2017 compared to the same quarter last year by 6.6% and versus the first quarter ending May 31, 2017 by 8.9%. The Company has reduced expenses at the divisions, as well as at the corporate location with the expectation that further decreases can be achieved. The completion of the merger of the two Florida businesses into one facility and the relocation of Lexel Imaging into a new facility have projected annual savings of approximately $500 thousand per year. Management continues to explore options to monetize certain long-term assets of the business. If additional and more permanent capital is required to fund the operations of the Company, no assurance can be given that the Company will be able to obtain the capital on terms favorable to the Company, if at all. The ability of the Company to continue as a going concern is dependent upon the success of management’s plans to improve revenues, the operational effectiveness of continuing operations, the procurement of suitable financing, or a combination of these. The uncertainty regarding the potential success of management’s plan create substantial doubt about the ability of the Company to continue as a going concern. |
Fair Value Measurements and Fin
Fair Value Measurements and Financial Instruments | 6 Months Ended |
Aug. 31, 2017 | |
Fair Value Measurements and Financial Instruments | Note 3. – Fair Value Measurements and Financial Instruments The Financial Accounting Standards Board’s (FASB’s) fair value measurement guidance establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The guidance describes three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets measured at fair value on a recurring basis by the Company consist of investment securities held for trading using Level 1 inputs. The following table sets forth financial assets and liabilities that were accounted for at fair value on a recurring basis as of August 31, 2017 and February 28, 2017 (in thousands): August 31, 2017 Level 1 Assets Level 2 Assets Level 3 Assets Current trading investments: Stocks, options and ETF (long) 509 509 — — Stocks, options and ETF (short) — — — — Total value of investments $ 509 $ 509 — — Current Liabilities: Margin balance (146 ) (146 ) Total value of liabilities (146 ) (146 ) Total $ 363 $ 363 — — February 28, 2017 Level 1 Assets Level 2 Assets Level 3 Assets Current trading investments: Stocks, options and ETF (long) 484 484 — — Stocks, options and ETF (short) (2 ) (2 ) Total value of investments $ 482 $ 482 — — Current Liabilities: Margin balance (114 ) (114 ) Total value of liabilities (114 ) (114 ) Total $ 368 $ 368 — — The Company’s financial instruments which are not measured at fair value on the consolidated balance sheets include cash, accounts receivable, short-term liabilities, and debt. The estimated fair value of these financial instruments were determined using Level 2 inputs and approximate cost due to the short period of time to maturity. Recorded amounts of long-term debt are considered to approximate fair value due to either interest rates that fluctuate with the market or are otherwise commensurate with the current market. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Aug. 31, 2017 | |
Recent Accounting Pronouncements | Note 4. – Recent Accounting Pronouncements In May, 2014, the FASB issued Accounting Standards Update No. (ASU) 2014-09 “Revenue with Contracts from Customers”. “Revenue with Contracts from Customers” In July 2015, the FASB issued ASU 2015-11, “ Simplifying the Measurement of Inventory” In November 2015, the FASB issued ASU 2015-17, “ Balance Sheet Classification of Deferred Taxes”. In February 2016, the FASB issued ASU 2016-02, “Leases” |
Inventories
Inventories | 6 Months Ended |
Aug. 31, 2017 | |
Inventories | Note 5. – Inventories Inventories are stated at the lower of cost (first in, first out) or market and consisted of the following (in thousands): August 31, February 28, 2017 2017 Raw materials $ 4,829 $ 5,217 Work-in-process 570 1,001 Finished goods 1,245 1,519 6,644 7,737 Reserves for obsolescence (1,985 ) (1,899 ) $ 4,659 $ 5,838 |
Long-Term Debt and Other Obliga
Long-Term Debt and Other Obligations | 6 Months Ended |
Aug. 31, 2017 | |
Long-Term Debt and Other Obligations | Note 6. – Long-Term Debt and Other Obligations Long-term debt consisted of the following (in thousands): August 31, February 28, 2017 2017 Mortgage payable to bank; interest rate at BB&T Bank base rate plus 0.5% (4.00% as of August 31, 2017); monthly principal and interest payments of $5 thousand payable through October 2021; collateralized by land and building of Teltron Technologies, Inc. $ 105 $ 131 105 131 Less current maturities (55 ) (54 ) $ 50 $ 77 The Company had outstanding margin account borrowing of $0.1 million as of August 31, 2017 and February 28, 2017. The margin account borrowings are used to purchase marketable equity securities and are netted against the investments in the balance sheet to show net trading investments. The gross investments were $0.5 million leaving net investments of $0.4 million after the margin account borrowings of $0.1 million as of August 31, 2017 and February 28, 2017. The margin interest rate is 2%. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Aug. 31, 2017 | |
Related Party Transactions | Note 7. – Related Party Transactions On March 30, 2016, the Company entered into an assignment with recourse of the note receivable from Z-Axis Inc. (Z-Axis) with Ronald D. Ordway, CEO, and Jonathan R. Ordway, related parties, for the sum of $912 thousand. The note receivable is collateralized by a security interest in the shares of Z-Axis as well as a personal guaranty of its majority shareholder. Z-Axis is current on all scheduled payments regarding this note. The Company retains the right to repurchase the note at any time for 80% of the outstanding principle balance. Also, in the event of default by Z-Axis, the Company is obligated to repurchase the note for 80% of the remaining principle balance plus any accrued interest. Accordingly, the Company has recognized this transaction as secured borrowing in accordance with the provisions of ASC 860-10. The $ 0.9 million, 9% interest rate, note originated on March 30, 2016, with payments beginning on April 16, 2016 and continuing for 56 months thereafter. The balance of the note was $679 thousand and $765 thousand as of August 31, 2017 and February 28, 2017, respectively. On July 3, 2017, the Company and Ordway Properties, LLC purchased Honeyhill Properties, LLC which is the owner of the building at 510 Henry Clay Blvd. in Lexington, KY for $1,500,000. Video Display Corporation invested $500,000 towards the purchase price and is accounting for the investment under the cost method, since Ordway Properties, LLC is the majority owner. The Company is a one third owner in Honeyhill Properties, LLC with Ordway Properties being a two thirds owner. The building is the new facility for the Company’s Lexel Imaging subsidiary, which had previously signed a five (5) year lease agreement with Honeyhill Properties, LLC on June 15, 2017 before the sale took place. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Aug. 31, 2017 | |
Supplemental Cash Flow Information | Note 8. – Supplemental Cash Flow Information Supplemental cash flow information is as follows (in thousands): Six Months Ended August 31, 2017 2016 Cash paid for: Interest $ 8 $ 9 Income taxes, net of refunds $ 23 $ 6 Non-cash activity: Note receivable paid directly to officer $ 85 $ 65 Note payable to officer $ (85 ) $ (65 ) Imputed interest expense $ 33 $ 42 Imputed interest income $ (33 ) $ (42 ) Capital additions transferred from inventory $ 113 — |
Shareholder's Equity
Shareholder's Equity | 6 Months Ended |
Aug. 31, 2017 | |
Shareholder's Equity | Note 9. – Shareholder’s Equity Earnings (Loss) Per Share Basic earnings (loss) per share is computed by dividing income or loss available to common shareholders by the weighted average number of common shares outstanding during each period. Shares issued during the period are weighted for the portion of the period that they were outstanding. Diluted earnings (loss) per share is calculated in a manner consistent with that of basic earnings (loss) per share while giving effect to all potentially dilutive common shares that were outstanding during the period. Diluted earnings (loss) per share is not presented separately because there are no adjustments to the numerator in calculating dilutive net loss per share and all potentially dilutive common stock equivalents would be antidilutive. The following table presents a reconciliation of all the shares used in the calculation of basic and dilutive earnings (loss) per share for the three and six month periods ended August 31, 2017 and 2016 (in thousands, except per share data): Weighted Average Earnings (Loss) Net Common Shares Per Income (Loss) Outstanding Share Six months ended August 31, 2017 Basic $ (487 ) 5,891 $ (0.08 ) Effect of dilution: Options — — — Diluted $ (487 ) 5,891 $ (0.08 ) Six months ended August 31, 2016 Basic $ (770 ) 5,891 $ (0.13 ) Effect of dilution: Options — — — Diluted $ (770 ) 5,891 $ (0.13 ) Three months ended August 31, 2017 Basic $ (221 ) 5,891 $ (0.04 ) Effect of dilution: Options — — — Diluted $ (221 ) 5,891 $ (0.04 ) Three months ended August 31, 2016 Basic $ (378 ) 5,891 $ (0.06 ) Effect of dilution: Options — — — Diluted $ (378 ) 5,891 $ (0.06 ) The number of anti-dilutive equity based compensation awards at August 31, 2017 and 2016 was 209,000 and 9,000. Stock-Based Compensation Plans For the six-month period ended August 31, 2017 and 2016, the Company recognized general and administrative expenses of $48 thousand and $3 thousand, respectively, related to share-based compensation. The liability for the share-based compensation recognized is presented in the consolidated balance sheet as part of additional paid in capital. As of August 31, 2017, and August 31, 2016 total unrecognized compensation costs related to stock options granted was $45 thousand and $2 thousand, respectively. The unrecognized stock option compensation cost is expected to be recognized over a period of approximately 3 years. The Company estimates the fair value of stock options granted using the Black-Scholes option-pricing model, which requires the Company to estimate the expected term of the stock option grants and expected future stock price volatility over the term. The term represents the expected period of time the Company believes the options will remain outstanding based on historical information. Estimates of expected future stock price volatility are based on the historic volatility of the Company’s common stock, which represents the standard deviation of the differences in the weekly stock closing price, adjusted for dividends and stock splits. 140,000 new options and 60,000 replacement options were granted during the six month period ended August 31, 2017 and no options were granted for the six month period ending August 31, 2016. Stock Repurchase Program The Company has a stock repurchase program, pursuant to which it had been authorized to repurchase up to 2,632,500 shares of the Company’s common stock in the open market. On January 20, 2014, the Board of Directors of the Company approved a one-time continuation of the stock repurchase program, and authorized the Company to repurchase up to 1,500,000 additional shares of the Company’s common stock in the open market. There is no minimum number of shares required to be repurchased under the program. For the six months ending August 31, 2017 and August 31, 2016, the Company did not purchase any shares of the Video Display Corporation stock. Under the Company’s stock repurchase program, an additional 502,644 shares remain authorized to be repurchased by the Company at August 31, 2017. |
Income Taxes
Income Taxes | 6 Months Ended |
Aug. 31, 2017 | |
Income Taxes | Note 10. – Income Taxes The effective tax rate for the six months ended August 31, 2017 and 2016 was (1.1%) and (1.4%) respectively. The Company lost $0.5 and $0.8 million dollars for the six months ending August 31, 2017 and August 31, 2016, respectively. Income tax expense of $5 thousand and $14 thousand was reported for the six months ended August 31, 2017 and 2016, respectively, and pertains to state taxes owed related to the Lexel Imaging subsidiary which is located in Kentucky, due to profitability reported related to Lexel with no offsetting state net operating losses. Due to the consolidated losses by the Company, a full valuation allowance was allocated to the deferred tax asset created by the loss. |
Legal Proceedings
Legal Proceedings | 6 Months Ended |
Aug. 31, 2017 | |
Legal Proceedings | Note 11. – Legal Proceedings The Company is involved in various legal proceedings related to claims arising in the ordinary course of business. On May 19, 2017, Lexel Imaging’s Chapter 11 Bankruptcy case was dismissed upon approval of a settlement agreement between Lexel Imaging (Lexel) and its landlord, Alidade Bull Lea, LLC (Alidade). The settlement agreement requires Lexel to surrender possession of the rental property on or before September 30, 2017 and remit to Alidade all past due rent of approximately $232 thousand. Lexel is also required to make payments totaling $100 thousand into an escrow account by July 28, 2017. These funds will be held by Alidade’s counsel until full and timely compliance with the settlement agreement are met, at which time the funds will be returned to Lexel. The settlement agreement also stipulates certain events of default for non-compliance. Events of default include, but are not limited to the following; 1) failure to make timely payment of back owed rent, escrow payments, and ongoing monthly rents through the exit date, 2) failure to enter into a new lease agreement or asset purchase agreement for all or substantially all of Lexel’s assets, with an unaffiliated third party on or before June 30, 2017, and 3) failure to vacate the property as defined. In the event of non-compliance Lexel has agreed to the following; 1) escrow amounts will be forfeited, 2) a stipulated $200 thousand civil judgment will be awarded to Alidade, 3) eviction from the property within 10 days, and 4) Lexel will pay all legal fees incurred by Alidade related to enforcement of the settlement agreement and foregoing remedies. The Company complied with all of the stipulations and successfully vacated the building on September 15, 2017. |
Financial Condition and Going18
Financial Condition and Going Concern (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Working Capital and Liquid Asset Position | The Company’s working capital and liquid asset position are presented below (in thousands) as of August 31, 2017 and February 28, 2017: August 31, 2017 February 28, Working capital $ 5,157 $ 6,408 Liquid assets $ 568 $ 503 |
Fair Value Measurements and F19
Fair Value Measurements and Financial Instruments (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Financial Assets and Liabilities Measured on Recurring Basis | The following table sets forth financial assets and liabilities that were accounted for at fair value on a recurring basis as of August 31, 2017 and February 28, 2017 (in thousands): August 31,2017 Level 1 Assets Level 2 Assets Level 3 Assets Current trading investments: Stocks, options and ETF (long) 509 509 — — Stocks, options and ETF (short) — — — — Total value of investments $ 509 $ 509 — — Current Liabilities: Margin balance (146 ) (146 ) Total value of liabilities (146 ) (146 ) Total $ 363 $ 363 — — February 28,2017 Level 1 Assets Level 2 Assets Level 3 Assets Current trading investments: Stocks, options and ETF (long) 484 484 — — Stocks, options and ETF (short) (2 ) (2 ) Total value of investments $ 482 $ 482 — — Current Liabilities: Margin balance (114 ) (114 ) Total value of liabilities (114 ) (114 ) Total $ 368 $ 368 — — |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Inventories | Inventories are stated at the lower of cost (first in, first out) or market and consisted of the following (in thousands): August 31, February 28, 2017 2017 Raw materials $ 4,829 $ 5,217 Work-in-process 570 1,001 Finished goods 1,245 1,519 6,644 7,737 Reserves for obsolescence (1,985 ) (1,899 ) $ 4,659 $ 5,838 |
Long-Term Debt and Other Obli21
Long-Term Debt and Other Obligations (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Long- Term debt | Long-term debt consisted of the following (in thousands): August 31, February 28, 2017 2017 Mortgage payable to bank; interest rate at BB&T Bank base rate plus 0.5% (4.00% as of August 31, 2017); monthly principal and interest payments of $5 thousand payable through October 2021; collateralized by land and building of Teltron Technologies, Inc. $ 105 $ 131 105 131 Less current maturities (55 ) (54 ) $ 50 $ 77 |
Supplemental Cash Flow Inform22
Supplemental Cash Flow Information (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Supplemental Cash Flow Information | Supplemental cash flow information is as follows (in thousands): Six Months Ended August 31, 2017 2016 Cash paid for: Interest $ 8 $ 9 Income taxes, net of refunds $ 23 $ 6 Non-cash activity: Note receivable paid directly to officer $ 85 $ 65 Note payable to officer $ (85 ) $ (65 ) Imputed interest expense $ 33 $ 42 Imputed interest income $ (33 ) $ (42 ) Capital additions transferred from inventory $ 113 — |
Shareholder's Equity (Tables)
Shareholder's Equity (Tables) | 6 Months Ended |
Aug. 31, 2017 | |
Computation of Basic and Diluted Earnings (Loss) Per Share | The following table presents a reconciliation of all the shares used in the calculation of basic and dilutive earnings (loss) per share for the three and six month periods ended August 31, 2017 and 2016 (in thousands, except per share data): Weighted Average Earnings (Loss) Net Common Shares Per Income (Loss) Outstanding Share Six months ended August 31, 2017 Basic $ (487 ) 5,891 $ (0.08 ) Effect of dilution: Options — — — Diluted $ (487 ) 5,891 $ (0.08 ) Six months ended August 31, 2016 Basic $ (770 ) 5,891 $ (0.13 ) Effect of dilution: Options — — — Diluted $ (770 ) 5,891 $ (0.13 ) Three months ended August 31, 2017 Basic $ (221 ) 5,891 $ (0.04 ) Effect of dilution: Options — — — Diluted $ (221 ) 5,891 $ (0.04 ) Three months ended August 31, 2016 Basic $ (378 ) 5,891 $ (0.06 ) Effect of dilution: Options — — — Diluted $ (378 ) 5,891 $ (0.06 ) |
Working Capital and Liquid Asse
Working Capital and Liquid Asset Position (Detail) - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Liquidity And Capital Resources [Line Items] | ||
Working capital | $ 5,157 | $ 6,408 |
Liquid assets | $ 568 | $ 503 |
Banking & Liquidity - Additiona
Banking & Liquidity - Additional Information (Detail) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Aug. 31, 2017 | Aug. 31, 2017USD ($)Business | Aug. 31, 2017 | |
Line of Credit Facility [Line Items] | |||
Number of business merged | Business | 2 | ||
Estimated savings due to merging of business | $ | $ 500 | ||
Decrease in operating costs percentage | (8.90%) | (6.60%) |
Financial Assets and Liabilitie
Financial Assets and Liabilities Measured on a Recurring Basis (Detail) - Recurring Basis - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Current trading investments | ||
Total value of investments | $ 509 | $ 482 |
Current liabilities: | ||
Margin balance | (146) | (114) |
Total value of liabilities | (146) | (114) |
Total | 363 | 368 |
Stocks, options, and ETF (long) | ||
Current trading investments | ||
Current trading investments | 509 | 484 |
Stocks, options, and ETF (short) | ||
Current trading investments | ||
Current trading investments | (2) | |
Level 1 Assets and Liabilities | ||
Current trading investments | ||
Total value of investments | 509 | 482 |
Current liabilities: | ||
Margin balance | (146) | (114) |
Total value of liabilities | (146) | (114) |
Total | 363 | 368 |
Level 1 Assets and Liabilities | Stocks, options, and ETF (long) | ||
Current trading investments | ||
Current trading investments | $ 509 | 484 |
Level 1 Assets and Liabilities | Stocks, options, and ETF (short) | ||
Current trading investments | ||
Current trading investments | $ (2) |
Inventories (Detail)
Inventories (Detail) - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Inventory [Line Items] | ||
Raw materials | $ 4,829 | $ 5,217 |
Work-in-process | 570 | 1,001 |
Finished goods | 1,245 | 1,519 |
Inventory, Gross | 6,644 | 7,737 |
Reserves for obsolescence | (1,985) | (1,899) |
Inventory, Net | $ 4,659 | $ 5,838 |
Long-Term Debt (Detail)
Long-Term Debt (Detail) - USD ($) $ in Thousands | Aug. 31, 2017 | Feb. 28, 2017 |
Debt Instrument [Line Items] | ||
Notes and Mortgage Payable to bank | $ 105 | $ 131 |
Less current maturities | (55) | (54) |
Long-term debt, less current maturities | 50 | 77 |
Mortgage payable to bank | ||
Debt Instrument [Line Items] | ||
Notes and Mortgage Payable to bank | $ 105 | $ 131 |
Long-Term Debt (Parenthetical)
Long-Term Debt (Parenthetical) (Detail) - Mortgage payable to bank $ in Thousands | 6 Months Ended |
Aug. 31, 2017USD ($) | |
Debt Instrument [Line Items] | |
Debt Instrument, interest rate terms | Mortgage payable to bank; interest rate at BB&T Bank base rate plus 0.5% (4.00% as of August 31, 2017); monthly principal and interest payments of $5 thousand payable through October 2021; collateralized by land and building of Teltron Technologies, Inc. |
Combined rate | 4.00% |
Mortgage Payable to bank monthly principal and interest payments payable | $ 5 |
Debt Instrument Maturity period | 2021-10 |
Base Rate | |
Debt Instrument [Line Items] | |
Interest rate | 0.50% |
Long Term Debt and Other Obliga
Long Term Debt and Other Obligations - Additional Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Aug. 31, 2017 | Feb. 28, 2017 | |
Debt Instrument [Line Items] | ||
Outstanding margin account borrowings | $ 100 | $ 100 |
Gross investments | 500 | 500 |
Trading investments, at fair value | $ 363 | $ 368 |
Margin interest rate | 2.00% | 2.00% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) | Jul. 03, 2017 | Mar. 30, 2016 | Aug. 31, 2017 | Feb. 28, 2017 |
Z-Axis Inc | ||||
Related Party Transaction [Line Items] | ||||
Notes receivable assigned with recourse | $ 912,000 | $ 679,000 | $ 765,000 | |
Notes repurchase right, percentage of outstanding principle balance | 80.00% | |||
Secured borrowing | $ 900,000 | |||
Effective interest rate | 9.00% | |||
Payment period | 56 months | |||
Date of first required payment | Apr. 16, 2016 | |||
Honeyhill Properties LLC [Member] | ||||
Related Party Transaction [Line Items] | ||||
Purchase of related party | $ 1,500,000 | |||
Investment towards cost method investments | $ 500,000 |
Supplemental Cash Flow Inform32
Supplemental Cash Flow Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | |
Aug. 31, 2017 | Aug. 31, 2016 | |
Cash paid for: | ||
Interest | $ 8 | $ 9 |
Income taxes, net of refunds | 23 | 6 |
Non-cash activity: | ||
Note receivable paid directly to officer | 85 | 65 |
Note payable to officer | (85) | (65) |
Imputed interest expense | 33 | 42 |
Imputed interest income | (33) | $ (42) |
Capital additions transferred from inventory | $ 113 |
Computation of Basic and Dilute
Computation of Basic and Diluted Earnings (Loss) Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2017 | Aug. 31, 2016 | Aug. 31, 2017 | Aug. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net Income (Loss), Basic | $ (221) | $ (378) | $ (487) | $ (770) |
Net Income (Loss), Options | 0 | 0 | 0 | 0 |
Net Income (Loss), Diluted | $ (221) | $ (378) | $ (487) | $ (770) |
Weighted Average Common Shares Outstanding, Basic | 5,891 | 5,891 | 5,891 | 5,891 |
Weighted Average Common Shares Outstanding, Options | 0 | 0 | 0 | 0 |
Weighted Average Common Shares Outstanding, Diluted | 5,891 | 5,891 | 5,891 | 5,891 |
Earnings (Loss) Per Share, Basic | $ (0.04) | $ (0.06) | $ (0.08) | $ (0.13) |
Earnings (Loss) Per Share, Options | 0 | 0 | 0 | 0 |
Earnings (Loss) Per Share, Diluted | $ (0.04) | $ (0.06) | $ (0.08) | $ (0.13) |
Shareholder's Equity - Addition
Shareholder's Equity - Additional Information (Detail) - USD ($) $ in Thousands | 6 Months Ended | ||
Aug. 31, 2017 | Aug. 31, 2016 | Jan. 20, 2014 | |
Stock Based Compensation [Line Items] | |||
Total unrecognized compensation costs related to stock options and shares of restricted stock granted | $ 45 | $ 2 | |
Unrecognized compensation cost is expected to be recognized over a period | 3 years | ||
Stock options granted | 140,000 | 0 | |
Authorized stock repurchase | 2,632,500 | ||
Additional authorized stock repurchase | 1,500,000 | ||
Repurchase of treasury stock (in shares) | 0 | 0 | |
Remaining repurchase of shares authorized | 502,644 | ||
Replacement Stock Options | |||
Stock Based Compensation [Line Items] | |||
Stock options granted | 60,000 | ||
General and Administrative | |||
Stock Based Compensation [Line Items] | |||
Share-based compensation | $ 48 | $ 3 | |
Stock Options | |||
Stock Based Compensation [Line Items] | |||
Number of anti-dilutive equity based compensation awards | 209,000 | 9,000 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Aug. 31, 2017 | Aug. 31, 2016 | Aug. 31, 2017 | Aug. 31, 2016 | |
Income Taxes [Line Items] | ||||
Effective Tax Rate | (1.10%) | (1.40%) | ||
Net income (loss) | $ (221) | $ (378) | $ (487) | $ (770) |
Income tax expense | (2) | 4 | $ 5 | $ 14 |
Federal tax expense | $ 0 | $ 0 |
Legal Proceedings - Additional
Legal Proceedings - Additional Information (Detail) - Lexel Imaging, Inc. $ in Thousands | 6 Months Ended |
Aug. 31, 2017USD ($) | |
Legal Proceedings [Line Items] | |
Stipulated penalty amount for non-compliance of civil judgment | $ 200 |
Bankruptcy proceedings description | Lexel Imaging’s Chapter 11 Bankruptcy case was dismissed upon approval of a settlement agreement between Lexel Imaging (Lexel) and its landlord, Alidade Bull Lea, LLC (Alidade). The settlement agreement requires Lexel to surrender possession of the rental property on or before September 30, 2017 and remit to Alidade all past due rent of approximately 232 thousand. |
Escrow amount deposit | $ 100 |
Reasonably possible losses related to forfeiture the escrow deposit | $ 100 |
Escrow deposit period | Jul. 28, 2017 |
Settlement Condition for Default Description | Events of default include, but are not limited to the following; 1) failure to make timely payment of back owed rent, escrow payments, and ongoing monthly rents through the exit date, 2) failure to enter into a new lease agreement or asset purchase agreement for all or substantially all of Lexel's assets, with an unaffiliated third party on or before June 30, 2017, and 3) failure to vacate the property as defined. |
Number of days for eviction from property for non-compliance | 10 days |
Settlement Condition for Non Compliance Description | In the event of non-compliance Lexel has agreed to the following; 1) escrow amounts will be forfeited, 2) a stipulated $200 thousand civil judgment will be awarded to Alidade, 3) eviction from the property within 10 days, and 4) Lexel will pay all legal fees incurred by Alidade related to enforcement of the settlement agreement and foregoing remedies. |
Property Lease Guarantee | |
Legal Proceedings [Line Items] | |
Litigation settlement amount | $ 232 |