Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Nov. 30, 2016 | Jan. 11, 2017 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Nov. 30, 2016 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | EACO CORP | |
Entity Central Index Key | 784,539 | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | EACO | |
Entity Common Stock, Shares Outstanding | 4,861,590 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Revenues | $ 37,207 | $ 34,293 |
Cost of revenues | 26,651 | 24,324 |
Gross margin | 10,556 | 9,969 |
Operating expenses: | ||
Selling, general and administrative expenses | 9,387 | 9,134 |
Income from operations | 1,169 | 835 |
Other (expense) income: | ||
Net loss on trading securities | (102) | (9) |
Interest expense, net | (4) | (6) |
Total other (expense) income | (106) | (15) |
Income before income taxes | 1,063 | 820 |
Provision for income taxes | 402 | 320 |
Discontinued operations: | ||
Net income | 661 | 500 |
Cumulative preferred stock dividend | (19) | (19) |
Net income attributable to common shareholders | $ 642 | $ 481 |
Basic and diluted earnings per share (in dollars per share) | $ 0.13 | $ 0.1 |
Basic and diluted weighted average common shares outstanding (in shares) | 4,861,590 | 4,861,590 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Net income | $ 661 | $ 500 |
Other comprehensive (loss) gain, net of tax: | ||
Foreign translation (loss) | (59) | (1) |
Total comprehensive income | $ 602 | $ 499 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 | [1] |
Current Assets: | |||
Cash and cash equivalents | $ 5,088 | $ 4,878 | |
Restricted cash, current | 1,864 | 1,425 | |
Trade accounts receivable, net | 18,620 | 18,797 | |
Inventory, net | 23,356 | 21,532 | |
Marketable securities, trading | 204 | 540 | |
Prepaid expenses and other current assets | 1,230 | 1,135 | |
Total current assets | 50,362 | 48,307 | |
Non-current Assets: | |||
Equipment and leasehold improvements, net | 1,811 | 1,395 | |
Other assets | 885 | 890 | |
Total assets | 53,058 | 50,592 | |
Current Liabilities: | |||
Trade accounts payable | 13,402 | 12,727 | |
Accrued expenses and other current liabilities | 2,290 | 5,600 | |
Liability for short sales of trading securities | 1,864 | 1,425 | |
Total current liabilities | 17,556 | 19,752 | |
Non-current Liabilities: | |||
Long-term debt | 4,079 | 0 | |
Total liabilities | 21,635 | 19,752 | |
Shareholders’ Equity: | |||
Convertible preferred stock, $0.01 par value per share; 10,000,000 shares authorized; 36,000 shares outstanding (liquidation value $900) | 1 | 1 | |
Common stock, $0.01 par value per share; 8,000,000 shares authorized; 4,861,590 shares outstanding | 49 | 49 | |
Additional paid-in capital | 12,378 | 12,378 | |
Accumulated other comprehensive income | 671 | 730 | |
Retained earnings | 18,324 | 17,682 | |
Total shareholders’ equity | 31,423 | 30,840 | |
Total liabilities and shareholders’ equity | $ 53,058 | $ 50,592 | |
[1] | Derived from the Company’s audited financial statements included in its Form 10-K for the year ended August 31, 2016 as filed with the U. S. Securities and Exchange Commission on November 23, 2016. |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Nov. 30, 2016 | Aug. 31, 2016 |
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Convertible preferred stock, shares outstanding | 36,000 | 36,000 |
Convertible preferred stock, liquidated (in dollars) | $ 900 | $ 900 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 8,000,000 | 8,000,000 |
Common stock, shares outstanding | 4,861,590 | 4,861,590 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | ||
Nov. 30, 2016 | Nov. 30, 2015 | ||
Operating activities: | |||
Net income | $ 661 | $ 500 | |
Adjustments to reconcile net income to net cash used in operating activities: | |||
Depreciation and amortization | 169 | 144 | |
Bad debt expense | 4 | 8 | |
Change in inventory reserve | 135 | 30 | |
Net loss on investments | 102 | 9 | |
(Increase) decrease in: | |||
Trade accounts receivable | 173 | (1,543) | |
Inventory | (1,959) | (248) | |
Prepaid expenses and other assets | (90) | (392) | |
Increase (decrease) in: | |||
Trade accounts payable | 190 | 1,270 | |
Accrued expenses and other current liabilities | (3,310) | (2,345) | |
Net cash used in operating activities | (3,925) | (2,567) | |
Investing activities: | |||
Purchase of property and equipment | (585) | (50) | |
Sale (purchase) of marketable securities, trading | 234 | (831) | |
Net change in securities sold short | 439 | 370 | |
Change in restricted cash | (439) | (366) | |
Net cash used in investing activities | (351) | (877) | |
Financing activities: | |||
Borrowings on revolving credit facility | 4,079 | 961 | |
Preferred dividend | (19) | (19) | |
Bank overdraft | 485 | 1,697 | |
Payments on long-term debt | 0 | (2) | |
Net cash provided by financing activities | 4,545 | 2,637 | |
Effect of foreign currency exchange rate changes on cash and cash equivalents | (59) | (1) | |
Net increase (decrease) in cash and cash equivalents | 210 | (808) | |
Cash and cash equivalents - beginning of period | 4,878 | [1] | 5,269 |
Cash and cash equivalents - end of period | 5,088 | 4,461 | |
Supplemental disclosures of cash flow information: | |||
Cash paid for income taxes | $ 2,627 | $ 2,194 | |
[1] | Derived from the Company’s audited financial statements included in its Form 10-K for the year ended August 31, 2016 as filed with the U. S. Securities and Exchange Commission on November 23, 2016. |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Nov. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | Note 1. Organization and Basis of Presentation EACO Corporation (“EACO”), incorporated in Florida in September 1985, is a holding company, primarily comprised of its wholly-owned subsidiary, Bisco Industries, Inc. (“Bisco”). Bisco was incorporated in Illinois in 1974 and is a distributor of electronic components and fasteners with 48 sales offices and seven distribution centers located throughout the United States and Canada. Bisco supplies parts used in the manufacture of products in a broad range of industries, including the aerospace, circuit board, communication, computer, fabrication, instrumentation, industrial equipment and marine industries. |
Significant Accounting Policies
Significant Accounting Policies and Significant Recent Accounting Pronouncements | 3 Months Ended |
Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | Note 2. Significant Accounting Policies and Significant Recent Accounting Pronouncements Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates include allowance for doubtful accounts receivable, slow moving and obsolete inventory reserves, recoverability of the carrying value and estimated useful lives of long-lived assets, workers’ compensation liability and the valuation allowance against deferred tax assets. Actual results could differ from those estimates. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in conformity with GAAP for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. In the opinion of management, all adjustments considered necessary in order to make the financial statements not misleading have been included. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations for presentation of interim financial information. Therefore, the condensed consolidated interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended August 31, 2016 (“fiscal 2016”). The condensed consolidated balance sheet as of August 31, 2016 and related disclosures were derived from the audited consolidated financial statements as of August 31, 2016. Operating results for the three months ended November 30, 2016 are not necessarily indicative of the results that may be expected for future quarterly periods or the entire fiscal year. Principles of Consolidation The consolidated financial statements for all periods presented include the accounts of EACO, its wholly-owned subsidiary, Bisco, and Bisco’s wholly-owned Canadian subsidiary, Bisco Industries Limited (all of which are collectively referred to herein as the “Company”, “we”, “us” and “our”). All significant intercompany transactions and balances have been eliminated in consolidation. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Trade accounts receivable are carried at original invoice amount, less an estimate for an allowance for doubtful accounts. Management determines the allowance for doubtful accounts by identifying probable credit losses in the Company’s accounts receivable and reviewing historical data to estimate the collectability on items not yet specifically identified as problem accounts. Trade accounts receivable are written off when deemed uncollectible. Recoveries of trade accounts receivable previously written off are recorded when received. A trade account receivable is considered past due if any portion of the receivable balance is outstanding for more than 30 days. The Company does not charge interest on past due balances. The allowance for doubtful accounts was $ 111,000 Inventory consists primarily of electronic fasteners and components, and is stated at the lower of cost or estimated market value. Cost is determined using the average cost method. Inventories are presented net of a reserve for slow moving or obsolete items of $ 1,442,000 1,307,000 Securities sold short represent transactions in which the Company sells a security borrowed from the broker, which it is obligated to purchase and deliver back to the broker. The initial value of the underlying security is recorded as a liability, and is adjusted to market value at each reporting period, with unrealized appreciation or depreciation being recorded for the change in value of the open short position. The Company records a realized gain or loss when the short position is closed. By entering into short sales, the Company bears the market risk of an unfavorable increase in the price of the security sold short in excess of the proceeds received. The market value of open short positions is separately presented as a liability in the consolidated balance sheets. The Company is required to establish a margin account with the lending broker equal to the market value of open short positions. As the use of such funds is restricted while the short sale is outstanding, the balance of this account is classified as restricted cash, current in the consolidated balance sheets. The restricted cash related to securities sold short was $ 1,864,000 1,425,000 Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of the impairment review, assets are measured by comparing the carrying amount to future net cash flows. If assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their estimated fair values. Deferred taxes on income result from temporary differences between the reporting of income for financial statement and tax reporting purposes. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some or all of the deferred tax asset will not be realized. In making such determination, the Company considers all available positive and negative evidence, including, but not limited to, scheduled reversals of deferred tax liabilities, projected future taxable income (if any), tax planning strategies and recent financial performance. We provide tax contingencies, if any, for federal, state, local and international exposures relating to audit results, tax planning initiatives and compliance responsibilities. The development of these reserves requires judgments and estimates regarding tax issues, potential outcomes and timing. Actual results could differ from those estimates. The Company generally recognizes revenue at the time of product shipment, as the Company’s shipping terms are FOB shipping point. Revenue is considered to be realized or realizable and earned when there is persuasive evidence of a sales arrangement in the form of an executed contract or purchase order, the product has been shipped, the sales price is fixed or determinable, and collectability is reasonably assured. Basic earnings per common share for the three months ended November 30, 2016 and 2015 were computed based on the weighted average number of common shares outstanding during each respective period. Diluted earnings per share for those periods have been computed based on the weighted average number of common shares outstanding, giving effect to all potentially dilutive common shares that were outstanding during the respective periods (See Note 4). Assets and liabilities recorded in functional currencies other than the U.S. dollar (Canadian dollars for Bisco’s Canadian subsidiary) are translated into U.S. dollars at the period-end rate of exchange. Revenue and expenses are translated at the weighted-average exchange rates for the quarters ended November 30, 2016 and 2015. The resulting translation adjustments are charged or credited directly to accumulated other comprehensive income or loss. The average exchange rates for the quarters ended November 30, 2016 and 2015 were $ 0.75 0.76 Net sales to customers outside the United States were approximately 9 8 11 10 No single customer accounted for more than 10 In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” to supersede the previous revenue recognition guidance under current GAAP. This guidance presents steps for comprehensive revenue recognition that requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance becomes effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating this statement and its impact on its results of operations or financial position. In July 2015, the FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory.” This guidance is part of the “Simplification Initiative” to identify and re-evaluate areas where the generally accepted accounting principles may be complex and cumbersome to apply. This guidance will require that inventory be stated at the lower of cost and net realizable value as opposed to the lower of cost or market. Net realizable value is the estimated selling price for the inventory less completion, disposal and transportation costs. This guidance becomes effective for fiscal years beginning after December 15, 2016. The Company is currently evaluating this statement and its impact on its results of operations or financial position. In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes.” The guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as non-current on the balance sheet. This guidance becomes effective for annual reporting periods beginning after December 6, 2016 with early adoption permitted. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. In February 2016, the FASB issued ASU 2016-02, “Leases,” which will require a lessee to recognize assets and liabilities with lease terms of more than 12 months. Both capital and operating leases will need to be recognized on the balance sheet. This guidance is effective for annual reporting periods beginning after December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments Credit Losses,” which will require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This guidance is effective for annual reporting periods beginning after December 15, 2019 and interim periods within those fiscal years. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. |
Debt
Debt | 3 Months Ended |
Nov. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | Note 3. Debt The Company has a $10,000,000 line of credit agreement with Community Bank, N.A. Borrowings under this agreement bear interest at either the 30, 60 or 90 day London Inter-Bank Offered Rate (“LIBOR”) (0.91% and 0.81% for the 90 day LIBOR at November 30, 2016 and August 31, 2016, respectively) plus 1.75% and/or the bank’s reference rate (3.50% at November 30, 2016 and August 31, 2016). Borrowings are secured by substantially all of the assets of. The line of credit agreement expires on March 1, 2017, but the Company plans to extend the agreement. The amounts outstanding under this line of credit as of November 30, 2016 and August 31, 2016 were $4,079,000 and $0, respectively. Availability under the line of credit was $5,921,000 and $10,000,000 at November 30, 2016 and August 31, 2016, respectively. The line of credit agreement contains certain covenants, including the maintenance of certain financial ratios. As of November 30, 2016 and August 31, 2016, the Company was in compliance with all financial covenants. |
Earnings per Share
Earnings per Share | 3 Months Ended |
Nov. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | Note 4. Earnings per Share Three Months Ended 2016 2015 EPS: Net income $ 661 $ 500 Less: accrued preferred stock dividends (19) (19) Net income available for common shareholders $ 642 $ 481 Earnings per common share basic and diluted $ 0.13 $ 0.10 For the three months ended November 30, 2016 and 2015, 40,000 36,000 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Nov. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | Note 5. Related Party Transactions The Company leases three buildings under operating lease agreements from its majority shareholder, who is also the Company’s Chairman and CEO. During the three months ended November 30, 2016 and 2015, the Company incurred approximately $163,000 and $165,000, respectively, of expense related to these leases. |
Income Taxes
Income Taxes | 3 Months Ended |
Nov. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Note 6. Income Taxes The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Management evaluates the need to establish a valuation allowance for deferred tax assets based upon the amount of existing temporary differences, the period in which they are expected to be recovered, and expected levels of taxable income. A valuation allowance to reduce deferred tax assets is established when it is “more likely than not” that some or all of the deferred tax assets will not be realized. Management has determined that other than deferred tax assets associated with certain state net operating losses and capital losses, net deferred tax assets will more likely than not be utilized. Therefore, a valuation allowance has been established against only those assets related to state net operating losses and capital losses. During the three months ended November 30, 2016, the Company recorded an income tax provision of $402,000 resulting in an effective tax rate of 37.8%. The effective tax rate differs from the statutory rate of 34% primarily due to the existence of a valuation allowance against certain deferred tax assets, state income tax expenses and permanent book to tax differences. Accounting for uncertainty in income taxes prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. For the three months ended November 30, 2016, the Company did not have a liability for unrecognized tax benefit. The Company has elected to classify interest and penalties as a component of its income tax provision. For the three months ended November 30, 2016, the Company did not have a liability for penalties or interest. The Company does not expect any changes to its unrecognized tax benefit for the next twelve months that would materially impact its consolidated financial statements. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Nov. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Note 7. Subsequent Events Management has evaluated events subsequent to November 30, 2016, through the date that these consolidated financial statements are being filed with the Securities and Exchange Commission, for transactions and other events which may require adjustment of and/or disclosure in such financial statements. |
Significant Accounting Polici14
Significant Accounting Policies and Significant Recent Accounting Pronouncements (Policies) | 3 Months Ended |
Nov. 30, 2016 | |
Accounting Policies [Abstract] | |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These estimates include allowance for doubtful accounts receivable, slow moving and obsolete inventory reserves, recoverability of the carrying value and estimated useful lives of long-lived assets, workers’ compensation liability and the valuation allowance against deferred tax assets. Actual results could differ from those estimates. |
Basis of Accounting, Policy [Policy Text Block] | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in conformity with GAAP for interim financial information and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. In the opinion of management, all adjustments considered necessary in order to make the financial statements not misleading have been included. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations for presentation of interim financial information. Therefore, the condensed consolidated interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended August 31, 2016 (“fiscal 2016”). The condensed consolidated balance sheet as of August 31, 2016 and related disclosures were derived from the audited consolidated financial statements as of August 31, 2016. Operating results for the three months ended November 30, 2016 are not necessarily indicative of the results that may be expected for future quarterly periods or the entire fiscal year. |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements for all periods presented include the accounts of EACO, its wholly-owned subsidiary, Bisco, and Bisco’s wholly-owned Canadian subsidiary, Bisco Industries Limited (all of which are collectively referred to herein as the “Company”, “we”, “us” and “our”). All significant intercompany transactions and balances have been eliminated in consolidation. |
Cash and Cash Equivalents, Policy [Policy Text Block] | The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. |
Trade and Other Accounts Receivable, Policy [Policy Text Block] | Trade Accounts Receivable, Net Trade accounts receivable are carried at original invoice amount, less an estimate for an allowance for doubtful accounts. Management determines the allowance for doubtful accounts by identifying probable credit losses in the Company’s accounts receivable and reviewing historical data to estimate the collectability on items not yet specifically identified as problem accounts. Trade accounts receivable are written off when deemed uncollectible. Recoveries of trade accounts receivable previously written off are recorded when received. A trade account receivable is considered past due if any portion of the receivable balance is outstanding for more than 30 days. The Company does not charge interest on past due balances. The allowance for doubtful accounts was $ 111,000 |
Inventory, Policy [Policy Text Block] | Inventories, Net Inventory consists primarily of electronic fasteners and components, and is stated at the lower of cost or estimated market value. Cost is determined using the average cost method. Inventories are presented net of a reserve for slow moving or obsolete items of $ 1,442,000 1,307,000 |
Securities Sold Short [Policy Text Block] | Securities Sold Short Securities sold short represent transactions in which the Company sells a security borrowed from the broker, which it is obligated to purchase and deliver back to the broker. The initial value of the underlying security is recorded as a liability, and is adjusted to market value at each reporting period, with unrealized appreciation or depreciation being recorded for the change in value of the open short position. The Company records a realized gain or loss when the short position is closed. By entering into short sales, the Company bears the market risk of an unfavorable increase in the price of the security sold short in excess of the proceeds received. The market value of open short positions is separately presented as a liability in the consolidated balance sheets. The Company is required to establish a margin account with the lending broker equal to the market value of open short positions. As the use of such funds is restricted while the short sale is outstanding, the balance of this account is classified as restricted cash, current in the consolidated balance sheets. The restricted cash related to securities sold short was $ 1,864,000 1,425,000 |
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] | Long-Lived Assets Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of the impairment review, assets are measured by comparing the carrying amount to future net cash flows. If assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds their estimated fair values. |
Income Tax, Policy [Policy Text Block] | Income Taxes Deferred taxes on income result from temporary differences between the reporting of income for financial statement and tax reporting purposes. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some or all of the deferred tax asset will not be realized. In making such determination, the Company considers all available positive and negative evidence, including, but not limited to, scheduled reversals of deferred tax liabilities, projected future taxable income (if any), tax planning strategies and recent financial performance. We provide tax contingencies, if any, for federal, state, local and international exposures relating to audit results, tax planning initiatives and compliance responsibilities. The development of these reserves requires judgments and estimates regarding tax issues, potential outcomes and timing. Actual results could differ from those estimates. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Company generally recognizes revenue at the time of product shipment, as the Company’s shipping terms are FOB shipping point. Revenue is considered to be realized or realizable and earned when there is persuasive evidence of a sales arrangement in the form of an executed contract or purchase order, the product has been shipped, the sales price is fixed or determinable, and collectability is reasonably assured. |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Common Share Basic earnings per common share for the three months ended November 30, 2016 and 2015 were computed based on the weighted average number of common shares outstanding during each respective period. Diluted earnings per share for those periods have been computed based on the weighted average number of common shares outstanding, giving effect to all potentially dilutive common shares that were outstanding during the respective periods (See Note 4). |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign Currency Translation and Transactions Assets and liabilities recorded in functional currencies other than the U.S. dollar (Canadian dollars for Bisco’s Canadian subsidiary) are translated into U.S. dollars at the period-end rate of exchange. Revenue and expenses are translated at the weighted-average exchange rates for the quarters ended November 30, 2016 and 2015. The resulting translation adjustments are charged or credited directly to accumulated other comprehensive income or loss. The average exchange rates for the quarters ended November 30, 2016 and 2015 were $ 0.75 0.76 |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations Net sales to customers outside the United States were approximately 9 8 11 10 No single customer accounted for more than 10 |
New Accounting Pronouncements, Policy [Policy Text Block] | Significant Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09 “Revenue from Contracts with Customers” to supersede the previous revenue recognition guidance under current GAAP. This guidance presents steps for comprehensive revenue recognition that requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance becomes effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The Company is currently evaluating this statement and its impact on its results of operations or financial position. In July 2015, the FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory.” This guidance is part of the “Simplification Initiative” to identify and re-evaluate areas where the generally accepted accounting principles may be complex and cumbersome to apply. This guidance will require that inventory be stated at the lower of cost and net realizable value as opposed to the lower of cost or market. Net realizable value is the estimated selling price for the inventory less completion, disposal and transportation costs. This guidance becomes effective for fiscal years beginning after December 15, 2016. The Company is currently evaluating this statement and its impact on its results of operations or financial position. In November 2015, the FASB issued ASU 2015-17, “Balance Sheet Classification of Deferred Taxes.” The guidance requires that all deferred tax assets and liabilities, along with any related valuation allowance, be classified as non-current on the balance sheet. This guidance becomes effective for annual reporting periods beginning after December 6, 2016 with early adoption permitted. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. In February 2016, the FASB issued ASU 2016-02, “Leases,” which will require a lessee to recognize assets and liabilities with lease terms of more than 12 months. Both capital and operating leases will need to be recognized on the balance sheet. This guidance is effective for annual reporting periods beginning after December 15, 2019 and interim periods within fiscal years beginning after December 15, 2020. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments Credit Losses,” which will require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. This guidance is effective for annual reporting periods beginning after December 15, 2019 and interim periods within those fiscal years. The Company is currently evaluating this statement and its impact on the Company’s results of operations or financial position. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Nov. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following is a reconciliation of the numerators and denominators of the basic and diluted computations for earnings per common share (in thousands, except per share data): Three Months Ended 2016 2015 EPS: Net income $ 661 $ 500 Less: accrued preferred stock dividends (19) (19) Net income available for common shareholders $ 642 $ 481 Earnings per common share basic and diluted $ 0.13 $ 0.10 |
Significant Accounting Polici16
Significant Accounting Policies and Significant Recent Accounting Pronouncements (Details Textual) - USD ($) | 3 Months Ended | |||
Nov. 30, 2016 | Nov. 30, 2015 | Aug. 31, 2016 | ||
Significant Accounting Policies [Line Items] | ||||
Allowance for Doubtful Accounts Receivable | $ 111,000 | $ 111,000 | ||
Inventory Valuation Reserves | $ 1,442,000 | 1,307,000 | ||
Exchange Rate on Foreign Currency Translation and Transactions | $ 0.75 | $ 0.76 | ||
Percentage of Revenue Per Entity, Maximum | 10.00% | 10.00% | ||
Restricted Cash and Cash Equivalents, Current | $ 1,864,000 | $ 1,425,000 | [1] | |
Sales Revenue, Net [Member] | ||||
Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 9.00% | 8.00% | ||
Accounts Receivable [Member] | ||||
Significant Accounting Policies [Line Items] | ||||
Concentration Risk, Percentage | 11.00% | 10.00% | ||
[1] | Derived from the Company’s audited financial statements included in its Form 10-K for the year ended August 31, 2016 as filed with the U. S. Securities and Exchange Commission on November 23, 2016. |
Debt (Details Textual)
Debt (Details Textual) - USD ($) | 3 Months Ended | |
Nov. 30, 2016 | Aug. 31, 2016 | |
Line of Credit Facility [Line Items] | ||
Long-term Line of Credit | $ 4,079,000 | $ 0 |
Line of Credit Facility, Remaining Borrowing Capacity | 5,921,000 | $ 10,000,000 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 10,000,000 | |
Line of Credit Facility, Interest Rate Description | bear interest at either the 30, 60 or 90 day London Inter-Bank Offered Rate (“LIBOR”) (0.91% and 0.81% for the 90 day LIBOR at November 30, 2016 and August 31, 2016, respectively) plus 1.75% and/or the bank’s reference rate (3.50% at November 30, 2016 and August 31, 2016). | |
Line of Credit [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Expiration Date | Mar. 1, 2017 |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
EPS: | ||
Net income | $ 661 | $ 500 |
Less: accrued preferred stock dividends | (19) | (19) |
Net income available for common shareholders | $ 642 | $ 481 |
Earnings per common share - basic and diluted | $ 0.13 | $ 0.1 |
Earnings per Share (Details Tex
Earnings per Share (Details Textual) - shares | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 40,000 | 40,000 |
Series A Cumulative Convertible Preferred Stock [Member] | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||
Convertible Preferred Stock, Shares Issued upon Conversion | 36,000 | 36,000 |
Related Party Transactions (Det
Related Party Transactions (Details Textual) - USD ($) | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Related Party [Member] | ||
Related Party Transaction [Line Items] | ||
Operating Leases, Rent Expense | $ 163,000 | $ 165,000 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Nov. 30, 2016 | Nov. 30, 2015 | |
Income Tax Expense (Benefit) | $ 402 | $ 320 |
Effective Income Tax Rate Reconciliation, Percent | 37.80% | |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | 34.00% |