Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2019shares | |
Document And Entity Information [Abstract] | |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Entity Registrant Name | TAT TECHNOLOGIES LTD |
Entity Central Index Key | 0000808439 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Non-accelerated Filer |
Entity Shell Company | false |
Entity Emerging Growth Company | false |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2019 |
Amendment Flag | false |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | FY |
Entity Common Stock, Shares Outstanding | 8,874,696 |
Entity Voluntary Filers | No |
Entity Well-known Seasoned Issuer | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Incorporation State Country Code | IL |
Entity File Number | 0-16050 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 15,959 | $ 15,950 | |
Accounts receivable, net | 21,167 | 19,277 | |
Inventory, net | [1] | 43,907 | 38,605 |
Other current assets and prepaid expenses | 2,605 | 3,627 | |
Total current assets | 83,638 | 77,459 | |
NON-CURRENT ASSETS: | |||
Investment in affiliates | 956 | 1,078 | |
Funds in respect of employee rights upon retirement | 1,404 | 2,253 | |
Deferred income taxes | 228 | 162 | |
Property, plant and equipment, net | 21,008 | 21,424 | |
Operating lease right of use assets | 6,664 | ||
Intangible assets, net | 777 | 911 | |
Total non-current assets | 31,037 | 25,828 | |
Total assets | 114,675 | 103,287 | |
CURRENT LIABILITIES: | |||
Accounts payable | 11,981 | 8,270 | |
Accrued expenses | 7,393 | 6,411 | |
Operating lease liabilities | 1,330 | ||
Total current liabilities | 20,704 | 14,681 | |
NON CURRENT LIABILITIES: | |||
Other long-term liabilities | 62 | 180 | |
Liability in respect of employee rights upon retirement | 1,751 | 2,648 | |
Deferred income taxes | 1,100 | 1,484 | |
Operating lease liabilities | 5,688 | ||
Total non-current liabilities | 8,601 | 4,312 | |
COMMITMENTS AND CONTINGENT LIABILITIES (NOTE 10) | |||
Total liabilities | 29,305 | 18,993 | |
EQUITY: | |||
Ordinary shares of NIS 0.9 par value: Authorized: 13,000,000 shares at December 31, 2019 and at December 2018; Issued: 9,149,169 shares at December 31, 2019 and at December 31, 2018; Outstanding: 8,874,696 shares at December 31, 2019 and at December 31, 2018 | 2,809 | 2,809 | |
Additional paid-in capital | 65,573 | 65,535 | |
Treasury shares, at cost, 274,473 shares at December 31, 2019 and 2018 | (2,088) | (2,088) | |
Accumulated other comprehensive income (loss) | 26 | (206) | |
Retained earnings | 19,050 | 18,244 | |
Total shareholders' equity | 85,370 | 84,294 | |
Total liabilities and shareholders' equity | $ 114,675 | $ 103,287 | |
[1] | The total amount of Rotables included in the company spare parts inventory for the years ended December 31, 2019 and 2018 were $8,886 and $8,284, respectively. |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - ₪ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value per share | ₪ 0.9 | ₪ 0.9 |
Ordinary shares, shares authorized | 13,000,000 | 13,000,000 |
Ordinary shares, shares issued | 9,149,169 | 9,149,169 |
Ordinary shares, shares outstanding | 8,874,696 | 8,874,696 |
Treasury shares, shares | 274,473 | 274,473 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | |||
Total revenues | $ 102,032 | $ 93,178 | $ 106,527 |
Cost of revenue: | |||
Total cost of revenues | 86,470 | 84,787 | 86,083 |
Gross profit | 15,562 | 8,391 | 20,444 |
Operating expenses: | |||
Research and development, net | 74 | 553 | 731 |
Selling and marketing | 5,259 | 4,913 | 4,974 |
General and administrative | 8,251 | 8,559 | 9,409 |
Other expenses (income) | (4) | 53 | |
Total operating expenses | 13,584 | 14,021 | 15,167 |
Operating income (loss) | 1,978 | (5,630) | 5,277 |
Financial expenses | (1,299) | (1,569) | (1,132) |
Financial income | 848 | 1,467 | 794 |
Income (loss) before taxes on income (tax benefit) | 1,527 | (5,732) | 4,939 |
Taxes on income (tax benefit) | 589 | (1,464) | 2,333 |
Income (loss) before share of equity investment | 938 | (4,268) | 2,606 |
Share in results of equity investment of affiliated companies | (132) | (140) | (210) |
Net income (loss) | $ 806 | $ (4,408) | $ 2,396 |
Net income (loss) per share basic and diluted | $ 0.1 | $ (0.5) | $ 0.27 |
Weighted average number of shares outstanding: | |||
Basic | 8,874,696 | 8,864,885 | 8,848,028 |
Diluted | 8,874,696 | 8,864,885 | 8,909,072 |
Product [Member] | |||
Revenue: | |||
Total revenues | $ 25,019 | $ 23,151 | $ 36,053 |
Cost of revenue: | |||
Total cost of revenues | 21,557 | 23,807 | 28,096 |
Service [Member] | |||
Revenue: | |||
Total revenues | 77,013 | 70,027 | 70,474 |
Cost of revenue: | |||
Total cost of revenues | $ 64,913 | $ 60,980 | $ 57,987 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 806 | $ (4,408) | $ 2,396 |
Other comprehensive income (loss), net | |||
Net unrealized gains (losses) from derivatives | 372 | (672) | (686) |
Reclassification adjustments for gains from derivatives included in net income | (140) | 331 | 894 |
Total other comprehensive income (loss) | 232 | (341) | 208 |
Total comprehensive income (loss) | $ 1,038 | $ (4,749) | $ 2,604 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY - USD ($) $ in Thousands | Share capital [Member] | Additional paid-in capital [Member] | Accumulated other comprehensive income (loss) [Member] | Treasury shares [Member] | Retained earnings [Member] | Total |
Balance at Dec. 31, 2016 | $ 2,797 | $ 64,760 | $ (73) | $ (2,088) | $ 23,256 | $ 88,652 |
Balance, shares at Dec. 31, 2016 | 9,102,917 | |||||
Comprehensive income | 208 | 2,396 | 2,604 | |||
Share based compensation | 174 | 174 | ||||
Exercise of options | $ 5 | 139 | $ 144 | |||
Exercise of options, shares | 19,584 | 19,583 | ||||
Dividend distributed | (3,000) | $ (3,000) | ||||
Balance at Dec. 31, 2017 | $ 2,802 | 65,073 | 135 | (2,088) | 22,652 | 88,574 |
Balance, shares at Dec. 31, 2017 | 9,122,501 | |||||
Comprehensive income | (341) | (4,408) | (4,749) | |||
Share based compensation | 272 | 272 | ||||
Exercise of options | $ 7 | 190 | $ 197 | |||
Exercise of options, shares | 26,668 | 26,668 | ||||
Balance at Dec. 31, 2018 | $ 2,809 | 65,535 | (206) | (2,088) | 18,244 | $ 84,294 |
Balance, shares at Dec. 31, 2018 | 9,149,169 | |||||
Comprehensive income | 232 | 806 | 1,038 | |||
Share based compensation | 38 | $ 38 | ||||
Exercise of options, shares | ||||||
Balance at Dec. 31, 2019 | $ 2,809 | $ 65,573 | $ 26 | $ (2,088) | $ 19,050 | $ 85,370 |
Balance, shares at Dec. 31, 2019 | 9,149,169 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income (loss) | $ 806 | $ (4,408) | $ 2,396 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 4,372 | 4,185 | 3,941 |
Loss on sale of property, plant and equipment | 54 | ||
Loss (gain) from change in fair value of derivatives | (311) | 382 | (490) |
Interest from short-term bank deposits and restricted deposits | (6) | ||
Change in provision for doubtful accounts | 38 | (347) | 321 |
Share in results of affiliated companies | 132 | 140 | 210 |
Share based compensation | 38 | 272 | 174 |
Exchange differences for lease liabilities | 354 | ||
Liability in respect of employee rights upon retirement | (897) | (587) | 241 |
Deferred income taxes, net | (450) | (102) | 382 |
Changes in operating assets and liabilities: | |||
Decrease (increase) in trade accounts receivable | (1,928) | 6,814 | (4,493) |
Decrease (increase) in other current assets and prepaid expenses | 2,500 | (1,575) | 488 |
Decrease (increase) in inventory | (5,388) | 161 | 210 |
Increase (decrease) in trade accounts payable | 3,292 | (969) | 578 |
Increase (decrease) in accrued expenses | 982 | (1,920) | (1,505) |
Increase (decrease) in other long-term liabilities | (118) | 34 | (5) |
Net cash provided by operating activities | 3,422 | 2,080 | 2,496 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Investment in affiliated company | (10) | (26) | (383) |
Funds in respect of employee rights upon retirement | (22) | (156) | |
Proceeds from sale of property and equipment | 7 | ||
Purchase of property and equipment | (3,403) | (4,270) | (3,520) |
Maturities of short-term deposits | 470 | 500 | |
Net cash used in investing activities | (3,413) | (3,841) | (3,559) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Dividend paid | (3,000) | ||
Exercise of options | 197 | 144 | |
Net cash provided by (used in) financing activities | 197 | (2,856) | |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 9 | (1,564) | (3,919) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR | 15,950 | 17,514 | 21,433 |
CASH AND CASH EQUIVALENTS AT END OF YEAR | 15,959 | 15,950 | 17,514 |
SUPPLEMENTARY INFORMATION ON INVESTING ACTIVITIES NOT INVOLVING CASH FLOW: | |||
Purchase of property, plant and equipment on credit | 942 | 523 | 632 |
Supplemental disclosure of cash flow information: | |||
Interest paid | (28) | (10) | (35) |
Income taxes received (paid), net | $ 673 | $ (1,087) | $ (2,397) |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2019 | |
GENERAL [Abstract] | |
GENERAL | NOTE 1 - GENERAL a. TAT Technologies Ltd., (“TAT” or the “Company”) an Israeli corporation, incorporated in 1985, is a leading provider of solutions and services to the aerospace and defense industries, focused mainly on the following four segments: (i) original equipment manufacturing (“OEM”) of heat transfer solutions and aviation accessories through our Gedera facility; (ii) MRO services for heat transfer components and OEM of heat transfer solutions through our Limco subsidiary; (iii) MRO services for aviation components through our Piedmont subsidiary; and (iv) overhaul and coating of jet engine components through our Turbochrome subsidiary. TAT targets the commercial aerospace (serving a wide range of types and sizes of commercial and business jets), military aerospace and ground defense sectors. TAT’s shares are listed on both the NASDAQ (TATT) and Tel-Aviv Stock Exchange. b. TAT has the following wholly-owned subsidiaries: Limco-Piedmont Inc. (“Limco-Piedmont”), and Turbochrome Ltd. (“Turbochrome”). Additionally, the Company holds 51% of TAT-Engineering LLC (“TAT-Engineering”), hereinafter collectively referred to as the “Group”. c. On November 25, 2015, the Company signed an agreement with Russian-based Engineering Holding of Moscow (“Engineering”), to establish a new facility for the provision of services for heat transfer products. The new company, TAT-Engineering LLC, is based in Novosibirsk’s Tolmachevo airport. TAT-Engineering, LLC shall provide services for heat transfer products. 51% of TAT-Engineering LLC's shares are held by TAT and the remaining 49% are held by Engineering. The accounting treatment of the joint venture is based on the equity method due to variable participating rights granted to Engineering. The new entity was established in January 2016. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES a. Basis of Presentation The Group's financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). b. Use of estimates in the preparation of financial statement The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose the nature of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting years. Actual results could differ from those estimates. As applicable to these financial statements, the most significant estimates and assumptions relate to: recoverability of inventory, provision for doubtful accounts and income taxes. c. Functional currency The majority of the revenues of each subsidiary in the Group are generated in U.S. dollars ("dollars") and a substantial portion of the costs of each subsidiary in the Group are incurred in dollars. Accordingly, the dollar is the currency of the primary economic environment in which the Group operates and accordingly its functional and reporting currency is the dollar. Transactions and balances originally denominated in dollars are presented at their original amounts. Balances in currencies other than the U.S. dollar are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. For non-dollar transactions and other items in the statements of income (indicated below), the following exchange rates are used: (i) for transactions – exchange rates at transaction dates or average rates; and (ii) for other items (derived from non-monetary balance sheet items such as depreciation and amortization, etc.) – historical exchange rates. Currency transaction gains and losses are carried to financial income or expenses, as appropriate. d. Principles of consolidation The consolidated financial statements include the accounts of TAT and its subsidiaries. Intercompany balances and transactions, including profits from intercompany sales not yet realized outside the Group, have been eliminated upon consolidation. e. Cash and Cash equivalents All highly liquid investments, which include short-term bank deposits, that are not restricted as to withdrawal or use, and short-term debentures, the period to maturity of which do not exceed three months at the time of investment, are considered to be cash equivalents. f. Short-term bank deposits g. Accounts receivable, net The Group’s accounts receivable balances are due from customers primarily in the airline and defense industries. Credit is extended based on evaluation of a customer’s financial condition and generally, collateral is not required. Trade accounts receivable from sales of services and products are typically due from customers within 30 - 90 days. Trade accounts receivable balances are stated at amounts due from customers net of a provision for doubtful accounts. Accounts outstanding longer than their original contractual payment terms are considered past due. The Group determines its allowance by considering a number of factors, including the length of time accounts receivable are past due, the Group’s previous loss history from such customers, the customer’s current ability to pay its obligation to TAT and the condition of the general economy and the industry as a whole. The Group writes-off accounts receivable when they become uncollectible. Payments subsequently received on such receivables are credited against earnings. The provision for doubtful accounts is determined with respect to specific debts that are doubtful of collection. h. Inventory Inventory is measured at the lower of cost and net realizable value. Inventories include raw materials, parts, work in progress and finished products. Cost of raw material and parts is determined using the “moving average” basis. Cost of work in progress and finished products is calculated based on actual costs. Capitalized production costs components, mainly labor and overhead, are determined on average basis over the production period. If actual market prices are less favorable than those projected by management, inventory write-downs may be required. Once written-down, a new lower cost basis for that inventory is established. Since the Group sells products and services related to airplane accessories for airplanes that can be in service for 20 to 50 years, it must keep a supply of such products and parts on hand while the airplanes are in use. The Group writes down its inventory for estimated obsolescence and unmarketable inventory equal to the difference between the cost of inventory and estimated market value based upon assumptions for future demand and market conditions. i. Property, plant and equipment Property, plant and equipment are stated at cost, after deduction of the related investment grants, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Years Buildings and leasehold improvements 7 - 39 Machinery and equipment 3 - 17 Motor vehicles 6 - 7 Office furniture and equipment 3 - 17 Software 3-5 Leasehold improvements are included in buildings and amortized using the straight line method over the period of the lease contract, or the estimated useful life of the asset, whichever is shorter. j. Grants from Israel Innovation Authority (IIA): Grants received from the IIA for approved research and development projects are recognized at the time the Company is entitled to such grants, on the basis of the costs incurred and included as a deduction from research and development expenses. Due the fact that the Company is defined as a "Traditional Industry Company", under the IIA regulations, the majority of grants are non-royalty bearing. k. Investment in affiliates and share in results of equity investment of affiliated companies Investment in which the Group exercises significant influence and which is not considered a subsidiary ("affiliate") is accounted for using the equity method, whereby the Group recognizes its proportionate share of the affiliated company's net income or loss after the date of investment. See Note 5. The Group reviews those investments for impairment whenever events indicate the carrying amount may not be recoverable. See Note 1(c). Transactions between the Group and the affiliate are eliminated on consolidation. Profits or losses are eliminated only on assets still remaining on the books of the Group or the affiliate. l. Leases On January 1, 2019 the Company adopted ASU No. 2016-02, Leases (Topic 842), The Company determines if an arrangement is a lease at inception. Balances related to operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized as of the commencement date based on the present value of lease payments over the lease term. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The discount rate for the lease is the rate implicit in the lease unless that rate cannot be readily determined. As the Company’s leases do not provide an implicit rate, the Company’s uses its estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term (see also note 2aa). m. Identified intangible assets Identifiable intangible assets are comprised of definite lived intangible assets - customer relationships, which are amortized using the straight-line method over their estimated period of useful life as determined by identifying the period in which substantially all of the cash flows are expected to be generated. Amortization of customer relationships is recorded under selling and marketing expenses. n. Impairment of long-lived assets Long-lived assets, including property, plant and equipment, operating lease right of use assets and definite life intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets (or asset group) may not be recoverable. In the event that the sum of the expected future cash flows (undiscounted and without interest charges) of the long-lived assets (or asset group) is less than the carrying amount of such assets, an impairment charge would be recognized and the assets (or asset group) would be written down to their estimated fair values (see also notes 5 and 6). o. Treasury Shares Company shares held by the Company are presented as a reduction of equity at their cost to the Company. The treasury shares have no rights. p. Revenue recognition The Group generates its revenues from the sale of OEM products and systems, providing MRO services (remanufacture, maintenance, repair and overhaul services and long - term service contracts) and parts services. In May 2014, FASB issued Accounting Standards Update "Revenue from Contracts with Customers" (Topic 606). To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the performance obligation is satisfied. Other major provisions include capitalization of certain contract costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance permitted the use of either a retrospective or cumulative effect transition method. The Company has implemented the new standard on its effective date (January 1, 2018) to uncompleted contracts as of that date, in accordance with the transitional directive which allows recognition of the cumulative effect of the initial application as an adjustment to the opening balance of retained earnings as of January 1, 2018. The adoption of ASC 606 did not impact the Company’s balance sheet or opening balance of retained earnings. The Company has adopted the following exemptions and accounting policies: a. The Company has chosen to account for shipping as a fulfillment costs, in cases in which the shipping occurs after the customer has obtained control of a good. b. The Company has chosen not to adjust the promised amount of consideration for the effects of a significant financing component, in cases in which the Company expects, at contract inception, that the period between when the Company transfers a promised good or service to the customer and when the customer pays for that good or service will be one year or less. c. The Company has chosen to present all sales taxes collected from customers on a net basis. Prior to January 1, 2018 and before the adoption of ASC 606, revenues from multi-year, fixed price contracts for OEM customers were recognized when a product was shipped (and title passed) to the customer. After the adoption of ASC 606, the group recognizes revenues from the sale of OEM products when it satisfies a performance obligation, i.e. when or as the customer obtains control upon product shipment. The Group does not grant a right of return. Prior to January 1, 2018 and before the adoption of ASC 606, revenues from MRO services were generally recognized when services were completed. In cases in which contracts required exchanging a defective landing gear for a restored gear, the non-refundable minimum amounts from these contracts were recognized on the exchange date (delivery of the product has occurred), and any additional amounts billed to the customer for excess hours of repair, were recognized when the customer approved the price for these additional services. After the adoption of ASC 606, the Group recognizes revenues from MRO services over time as it satisfies its performance obligations. The Group satisfies its performance, according to required milestones. q. Warranty costs The Group provides warranties for its products and services ranging from one to three years, which vary with respect to each contract and in accordance with the nature of each specific product. According to past experience, most of the warranty costs incur during the first year of the contract. The Group estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time revenue is recognized. The Group periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. r. Research and development Research and development costs, net of grants, are charged to expenses as incurred. s. Fair value measurement The Group measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data or active market data for similar but not identical assets or liabilities. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers credit risk in its assessment of fair value. t. Concentrations of credit risk Financial instruments that potentially subject the Group to concentrations of credit risk consist principally of cash and cash equivalents, derivatives and accounts receivable. Cash and cash equivalents are deposited with major banks in Israel and the United States. Such deposits in the United States may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Group's cash and cash equivalents are financially sound. Accordingly, minimal credit risk exists with respect to these financial instruments. The Group's accounts receivable are derived mainly from sales to customers in the United States, Israel and Europe. The Group generally does not require collateral; however, in certain circumstances the Group may require letters of credit. Management believes that credit risks relating to accounts receivable are minimal since the majority of the Group's customers are world-leading manufacturers of aviation systems and aircrafts, international airlines, governments and air-forces, and world-leading manufacturers and integrators of defense and ground systems. In addition, the Group has relatively a large number of customers with wide geographic spread which mitigates the credit risk. The Group performs ongoing credit evaluation of its customers' financial condition. u. Income taxes Income taxes are accounted for in accordance with ASC 740 "Income Taxes". This statement prescribes the use of the asset and liability method, whereby deferred tax assets and liabilities account balances are determined based on temporary differences between financial reporting and tax basis of assets and liabilities and for tax loss carry-forwards. Deferred taxes are measured using the enacted laws and tax rates that will be in effect when the differences are expected to reverse. The Group provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value, see note 13(h). Taxes which would apply in the event of disposal of investments in foreign subsidiaries have not been taken into account in computing the deferred taxes, when the Group’s intention is to hold, and not to realize the investments. Taxes which would apply in the event of distribution of earnings from foreign subsidiaries of the Company, have been taken into account in computing the deferred taxes, when there is a possibility of future distribution of earnings from such foreign subsidiaries. The Group did not provide for deferred taxes attributable to dividend distribution out of retained tax-exempt earnings from "Approved/Benefited Enterprise" plans (see note 13(a)), since it intends to permanently reinvest them and has no intention to declare dividends out of such tax exempt income in the foreseeable future. Management considers such retained earnings to be essentially permanent in duration. The payment of dividend in 2017 and 2016 was paid from foreign subsidiaries earnings of the Company and earnings from regular income of the Israeli company, respectively. Results for tax purposes for TAT’s Israeli subsidiaries are measured and reflected in NIS. As explained in (c) above, the consolidated financial statements are measured and presented in U.S. dollars. In accordance with ASC 740, TAT has not provided deferred income taxes on the differences resulting from changes in exchange rate and indexation. The Group follows a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate resolution. The Group’s policy is to include interest and penalties related to unrecognized tax benefits within financial income (expense). Such liabilities are classified as long-term, unless the liability is expected to be resolved within twelve months from the balance sheet date. v. Earnings per share Basic earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of shares of the Company's Ordinary Shares, par value NIS 0.9 per share outstanding for each period. Diluted earnings (loss) per share are calculated by dividing the net income by the fully-diluted weighted-average number of ordinary shares outstanding during each period. Potentially dilutive shares include outstanding options granted to employees and directors, using the treasury stock method. w. Share-based compensation The Group applies ASC 718 "Stock Based Compensation" with respect to employees and directors’ options, which requires awards classified as equity awards to be accounted for using the grant-date fair value method. The fair value of share-based awards is estimated using the Black-Scholes valuation model, the payment transaction is recognized as expense over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures based on historical experience and anticipated future conditions. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule using the accelerated method over the requisite service period for the entire award. x. Comprehensive income (loss) Comprehensive income in 2019, 2018 and 2017 includes, in addition to net income or loss, gains and losses of derivatives (net of related taxes where applicable). Reclassification adjustments for gain or loss of derivatives are included in the relevant line item in the statement of income. See also note 2 (z). y. Contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Group but which will only be resolved when one or more future events occur or fail to occur. The Group’s management assesses such contingent liabilities and estimated legal fees, if any, and accrues for these costs. Such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Group or unasserted claims that may result in such proceedings, the Group’s management evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. Management applies the guidance in ASC 450-20-25 when assessing losses resulting from contingencies. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability is recorded as accrued expenses in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material are disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed. z. Derivatives and hedging The Company carries out transactions involving foreign currency exchange derivative financial instruments. The transactions are designed to hedge the Company’s exposure in currencies other than the U.S. dollar. The Company recognizes derivative instruments as either assets or liabilities and measures those instruments at fair value. For derivative instruments that are designated and qualify as a cash-flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the anticipated transaction in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of a derivative designated as a cash flow hedge is recognized in "financial expense (income), net". If a derivative does not meet the definition of a cash flow hedge, the changes in the fair value are included in "financial expense (income), net". After the adoption of ASU 2017-12, the main effect is that the overall influence of the hedging appears under the same line of the hedged item and not under "financial expense (income), net". For derivative instruments that qualify for hedge accounting, the cash flows associated with these derivatives are reported in the consolidated statements of cash flows consistently with the classification of the cash flows from the underlying hedged items that these derivatives are hedging. aa. Recently Issued Accounting Principles: Recently adopted accounting pronouncements: 1) The Company adopted ASU No. 2016-02, Leases (Topic 842), on January 1, 2019 using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after January 1, 2019 are presented under Topic 842, while prior period amounts have not been adjusted and continue to be reported in accordance with its historical accounting under Topic 840. The Company elected the package of practical expedients permitted under the transition guidance, which allowed to carryforward the Company’s historical lease classification, the Company’s assessment on whether a contract was or contains a lease, and the Company’s initial direct costs for any leases that existed prior to January 1, 2019. The Company also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term. Upon adoption, the new standard resulted in an increase of $7.3 million in operating lease ROU assets and corresponding liabilities on the Company’s consolidated balance sheet. The weighted-average interest rate used to discount future lease payments was 4.84% for the assets in the USA and 4.5% for the Israeli assets. 2) In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities. Among other things, the guidance eliminated the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. As ASU 2017-12 was effective for fiscal years beginning after December 15, 2018, the Company adopted the ASU on January 1, 2019 with no material impact on the Company’s consolidated financial statements. Accounting pronouncements issued but not yet adopted: (1) In June 2016, the FASB issued guidance on financial instruments. The guidance replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The guidance will be effective for the fiscal year beginning on January 1, 2020, including interim periods within that year. The new standard will not have a material effect on the Company's financial statements upon adoption. (2) In December 2019, the FASB issued ASU 2019-12, “Simplifying the Accounting for Income Taxes. (Topic 740)” ("the Update"). The amendments in this Update simplify the accounting for income taxes by removing the following exceptions in ASC 740: 1. Exception to the incremental approach for intra-period tax allocation when there is a loss from continuing operations and income or a gain from other items; 2. Exception to the requirement to recognize a deferred tax liability for equity method investments when a foreign subsidiary becomes an equity method investment; 3. Exception to the ability not to recognize a deferred tax liability for a foreign subsidiary when a foreign equity method investment becomes a subsidiary;4. Exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. In addition, this Update also simplify the accounting for income taxes in certain topics as follows: 1. Requiring that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax; 2. Requiring that an entity evaluate when a step up in the tax basis of goodwill should be considered part of the business combination in which the book goodwill was originally recognized and when it should be considered a separate transaction;3. Specifying that an entity can elect (rather than required to) allocate the consolidated amount of current and deferred tax expense to a legal entity that is not subject to tax in its separate financial statements;4. Requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the effects of this Update on its consolidated financial statements. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT | NOTE 3 - FAIR VALUE MEASUREMENT Recurring Fair Value Measurements The Group measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company's financial assets and liabilities measured at fair value on a recurring basis, consisted of the following types of instruments: December 31, 2019 Level 1 Level 2 Level 3 Total Assets: Derivative financial instruments - $ 27 - $ 27 December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Derivative financial instruments - $ 210 - $ 210 a. Derivative financial instruments: The company hedges the foreign currency risk arising from probable forecasted Israeli Shekel ("ILS") expenses as part of its risk management policy. The risk management objective is to hedge the foreign currency exchange rate fluctuations associated with ILS denominated forecasted probable expenses according to the company's hedging policy. The majority of the ILS exposure arises from expected related salary expenses. The Company enters into contracts for derivative financial instruments forward contracts in order to execute its policy. Such derivatives are recognized at fair value. The fair value of forward contracts is calculated as the difference between the forward rate on valuation date and the forward rate on the original forward contract, multiplied by the transaction's notional amount. At the inception of a hedge relationship, the Company formally designates and documents the hedge relationship to which the Company wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The hedge effectiveness is assessed at the end of each reporting period. The effective portion of the gain or loss on the hedging instrument is recognized as other comprehensive income (loss), while any ineffective portion is recognized immediately in profit or loss through finance income (expenses), net. The effective portion is determined by looking into changes in spot exchange rate. The change in fair value attributable to changes other than those due to fluctuations in the spot exchange rate are excluded from the assessment of hedge effectiveness and are recognized in the statement of income under financial expenses-net. For derivative instruments that are designated and qualify as a cash-flow hedge, the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the anticipated transaction in the same period or periods during which the hedged transaction affects earnings. For derivative instruments that qualify for hedge accounting, the cash flows associated with these derivatives are reported in the consolidated statements of cash flows consistently with the classification of the cash flows from the underlying hedged items that these derivatives are hedging. As of December 31, 2019 and 2018, the Company has open forward contracts with a notional total amount of $1,017 and $10,332, respectively. As of December 31, 2019, the company has open call options and open put options with a notional total amount of $3,781 and $3,957, respectively. The carrying amounts of financial instruments include cash and cash equivalents, short-term bank deposits, accounts receivable, accounts payable and accrued liabilities approximate fair value because of their short maturities. |
INVENTORY
INVENTORY | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 4 - INVENTORY Inventory is composed of the following: December 31, 2019 2018 Raw materials and components $ 13,296 $ 10,758 Work in progress 11,735 7,297 Spare parts 18,272 19,557 Finished goods 604 993 Total inventory (**) $ 43,907 $ 38,605 (**) The total amount of Rotables included in the company spare parts inventory for the years ended December 31, 2019 and 2018 were $8,886 and $8,284, respectively. Slow inventory expenses amounted to $147, $691 and $964 for the years ended December 31, 2019, 2018 and 2017, respectively. The company maintains a wide range of exchangeable units and other spare parts related to its products and services in various locations. Due to the long lead time of its suppliers and manufacturing cycles, the company needs to forecast demand and commit significant resources towards these inventories. As such, the Company is subject to significant risks including excess inventory no longer relevant. |
INVESTMENT IN AFFILIATES
INVESTMENT IN AFFILIATES | 12 Months Ended |
Dec. 31, 2019 | |
Investments in and Advances to Affiliates [Abstract] | |
INVESTMENT IN AFFILIATES | NOTE 5 - INVESTMENT IN AFFILIATES On November 25, 2015, the Company signed an agreement with Russian-based Engineering Holding of Moscow (“Engineering”), to establish a new facility for the provision of services for heat transfer products. The new company, TAT-Engineering LLC, is based in Novosibirsk’s Tolmachevo airport. TAT-Engineering, LLC shall provide services for heat transfer products. 51% of TAT-Engineering LLC's shares are held by TAT and the remaining 49% are held by Engineering. The accounting treatment of the joint venture is based on the equity method due to variable participating rights granted to Engineering. The new entity was established in January 2016 . Summarized financial information of TAT-Engineering LLC: December 31, 2019 2018 Balance sheets: Current assets $ 466 $ 919 Non-current assets 1,383 1,436 Current liabilities 1,040 1,254 Non-current liabilities - - Year ended December 31, 2019 2018 2017 Statements of operation: Revenues $ 877 $ 1,534 $ 604 Gross loss (228 ) (154 ) (216 ) Loss from continuing operations (291 ) (266 ) (412 ) Net losses attributable to the Company (132 ) (140 ) (210 ) |
PROPERTY, PLANT AND EQUIPMENT,
PROPERTY, PLANT AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT, NET | NOTE 6 - PROPERTY, PLANT AND EQUIPMENT, NET Composition of assets, grouped by major classifications, is as follows: December 31, 2019 2018 Cost: Land and buildings $ 14,863 $ 13,077 Machinery and equipment 52,872 51,017 Motor vehicles 410 410 Office furniture and equipment 1,811 1,802 Software 1,420 1,248 71,376 67,554 Less: Accumulated depreciation 50,368 46,130 Depreciated cost $ 21,008 $ 21,424 Depreciation expenses amounted to $4,238, $4,051 and $3,807 for the years ended December 31, 2019, 2018 and 2017, respectively. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2019 | |
Lessee Disclosure [Abstract] | |
LEASES | NOTE 7 - LEASES Lease commitments: Limco-Piedmont leases some of its operating and office facilities for various terms under long-term, non-cancelable operating lease agreements. The leases expire at various dates through 2029. Certain leases contain renewal options as defined in the agreements. During 2019, Limco leased a new building (building #5) for its operation. The lease on building #5 expires on March 31, 2030. Building #5 has an early termination option effective after March 31, 2019 with six months advance written notice. The rent is $4,100 per month for building #5 plus the annual percentage increase in the CPI-W. Lease expense totaled $510, $494 and $474 for the years ended December 31, 2019, 2018, and 2017 respectively. TAT leases its factory from TAT Industries until the end of 2024. Lease expense totaled $787, $767 and $740 for the years ended December 31, 2019, 2018, and 2017 respectively. The Company entered into several three-year leases for vehicles. The current monthly lease fees aggregate approximately $40. The lease cost was as follows: Year ended December 31, 2019 Operating lease expenses 1,297 Supplemental cash flow information related to leases was as follows: Year ended December 31, 2019 Operating cash flows from operating leases 354 Supplemental information for amounts included in the measurement of lease liabilities are as follows: December 31, 2019 Operating Leases Operating lease right-of-use assets 6,664 Current operating lease liabilities 1,330 Non-current operating lease liabilities 5,688 Total operating lease liabilities 7,018 Weighted Average Remaining Lease Term Operating leases - Israel 5 years Operating leases - United States 6 years Operating leases - Israel 4.5 % Operating leases - United States 4.84 % As of December 31, 2019, the maturities of lease liabilities were as follows: Year Amount 2020 $ 1,626 2021 1,461 2022 1,314 2023 1,250 2024 and after 1,827 Total lease payments 7,478 Less imputed interest (460 ) Total $ 7 , As of December 31, 2018, the minimum lease payments of the Company, were as follows: Year Amount 2019 $ 1,551 2020 1,488 2021 1,330 2022 1,224 2023 and after 2,719 Total $ 8,312 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 8 - INTANGIBLE ASSETS Intangible assets: December 31, 2019 2018 Customer relationships Cost $ 1,342 $ 1,342 Accumulated amortization (565 ) (431 ) Amortized cost $ 777 $ 911 |
ACCRUED EXPENSES
ACCRUED EXPENSES | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 9 - ACCRUED EXPENSES December 31, 2019 2018 Employees and payroll accruals $ 3,332 $ 2,869 Accrued expenses 937 840 Authorities 810 677 Advances from customers 513 483 Warranty provision 235 285 Accrued royalties and rebate sales commissions 1,517 966 Other 49 291 $ 7,393 $ 6,411 |
RELATED PARTIES' TRANSACTIONS A
RELATED PARTIES' TRANSACTIONS AND BALANCES | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES' TRANSACTIONS AND BALANCES | NOTE 10 - RELATED PARTIES’ TRANSACTIONS AND BALANCES Transactions: Year ended December 31, 2019 2018 2017 Income - Sales to related-party company (*) $ 596 $ 1,251 $ 959 Cost and expenses - Supplies from related party (*) $ 552 $ 59 $ 6 Balances: December 31, 2019 2018 Trade receivables and other receivables (*) $ 706 $ 699 Trade payables and other payables (*) $ 154 $ - (*) includes mainly transactions with affiliated companies. |
LONG-TERM EMPLOYEE-RELATED OBLI
LONG-TERM EMPLOYEE-RELATED OBLIGATIONS | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
LONG-TERM EMPLOYEE-RELATED OBLIGATIONS | NOTE 11 - LONG-TERM EMPLOYEE-RELATED OBLIGATIONS Severance pay: The Company and its Israeli subsidiary are required to make severance payments upon dismissal of an employee or upon termination of employment in certain circumstances. The severance payment liability to the employees (based upon length of service and the latest monthly salary - one month’s salary for each year employed) is recorded on the Company’s balance sheet under “Liability for employee rights upon retirement.” The liability is recorded as if it were payable at each balance sheet date on an undiscounted basis. According to Section 14 of the Israeli Severance Pay Law, the Israeli company’s liability for certain employees, according to their employment agreements, make regular deposits with certain insurance companies for accounts controlled by each applicable employee in order to secure the employee’s retirement benefit obligation. The Company and its Israeli subsidiary are fully relieved from any severance pay liability with respect to each such employee after it makes the payments on behalf of the employee. The liability accrued in respect of these employees and the amounts funded, as of the respective agreement dates, are not reflected in the Company balance sheet, as the amounts funded are not under the control and management of the Company and the pension or severance pay risks have been irrevocably transferred to the applicable insurance companies (the “Contribution Plan”). With regard to the employees that are not under the “Contribution Plan”, the liability is funded in part from the purchase of insurance policies or by the establishment of pension funds with dedicated deposits in the funds. The amounts used to fund these liabilities are included in the balance sheets under “Funds in respect of employee rights upon retirement.” These policies are the Company’s assets. Severance pay (cont.): In the years ended December 31, 2019, 2018 and 2017 the Company deposited $1,096, $968 and $910 respectively, with pension funds and insurance companies in connection with its severance payment obligations. Limco-Piedmont sponsors a 401(K) safe harbor profit sharing plan covering substantially all of its employees. The plan requires the employer to contribute a match which is currently done on a payroll period basis, matching 100% of the first 2% and 50% of all salary deferrals made up to the next 3%. In addition, the plan allows for a discretionary qualified non-elective contribution for the plan year. Contributions to the plan by Limco-Piedmont were $406, $385 and $350 for the years ended December 31, 2019, 2018 and 2017, respectively. The Group expects to contribute approximately $1,208 in 2020 to the pension funds and insurance companies in respect of their severance and pension pay obligations. The amounts of severance payments, actually paid to retired employees, by TAT were $689, $400 and $96 for the years ended December 31, 2019, 2018 and 2017. TAT expects to pay $1,026 in future benefits to their employees during 2020 through 2029 upon their normal retirement age. The amount was determined based on the employee’s current salary rates and the number of service years that will be accumulated upon the retirement date. These amounts do not include amounts that might be paid to employees that will cease working for the Israeli company before their normal retirement age. Year Amount 2020 $ 341 2021 55 2022 9 2023 147 2024 48 Thereafter (through 2029) 426 Total $ 1,026 |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 12 - COMMITMENTS AND CONTINGENT LIABILITIES a. Commissions arrangements: The Group is committed to pay marketing commissions ranging 1% to 10% to sale agents of total sales contracts. Commission expenses were $679, $411 and $664 for the years ended December 31, 2019, 2018 and 2017, respectively. The commissions were recorded as part of the selling and marketing expenses. b. Royalty commitments: (1) TAT is committed to pay royalties to third parties, ranging from 12% to 17% of sales of products developed by the third parties. Royalty expenses were $42, $148 and $25 for the years ended December 31, 2019, 2018 and 2017, respectively. The royalties were recorded as part of the cost of revenues. (2) Piedmont is committed to pay royalties to a third party, ranging 5% to 13% of sales of products purchased from the third party. That third party is the exclusive manufacturer of the products for which Piedmont provides MRO services. In addition, Piedmont is committed to pay another third party royalties of 20%, on parts reclaimed to use in MRO services or sold to our customers when they are manufactured by the third party. Royalty expenses were $2,310, $1,689 and $1,885 for the years ended December 31, 2019, 2018 and 2017, respectively. The royalties were recorded as part of the cost of revenues. c. Guarantees: (1) In order to secure TAT's liability to the Israeli customs, the Company provided a bank guarantee in the amount of $58. The guarantee is linked to the consumer price index and is valid until January 2021. In addition, the Company provided a bank guarantee in the amount of $36. The guarantee is linked to the consumer price index and is valid until March 2021. (2) In order to secure TAT's liability to the lessor of its premises, the Company provided a bank guarantee in the amount of $790. The guarantee is linked to the consumer price index in Israel and is valid until July 2020. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 13 - SHAREHOLDERS' EQUITY a. TAT's Ordinary shares confer upon their holders voting rights, the right to receive dividends, if declared, and any amounts payable upon the dissolution, liquidation or winding up of the affairs of TAT. TAT's Treasure shares have no rights. b. Stock option plans: Following the approval of TAT's Audit Committee and Board of Directors, on June 28, 2012, the Company’s shareholders approved the 2012 stock option plan (the “2012 Plan”) to grant up to 380,000 options to purchase Ordinary shares, 0.9 NIS par value, of the Company to senior executives and certain members of the Board of Directors, at an exercise price as determined in the stock option plan. The option pool was increased in 2016 by 300,000 to an aggregate option pool of 680,000 options following the approvals of the Company's Audit Committee, Board of Directors and shareholders. In general, the Options vest over a period of 4 years as follows: 25% of the Options vest upon the lapse of 12 months following the date of grant and the remaining 75% vest on a quarterly basis over the remaining 3-year period. In addition, certain Options that were previously granted vest over a three-year period (one-third each year) and the vesting of 50% of such Options is subject, in addition, to certain minimum shareholders' equity during a period of 4 years from the grant date. The grant of options to Israeli employees under the Plan is subject to the terms stipulated by Sections 102 and 102A of the Israeli Income Tax Ordinance. Each option grant is subject to the track chosen by the Company, either Section 102 or Section 102A of the Israeli Income Tax Ordinance, and pursuant to the terms thereof, the Company is not allowed to claim as an expense for tax purposes the amounts credited to employees as benefits, including amounts recorded as salary benefits in the Company’s accounts, in respect of options granted to employees under the Plan, with the exception of the work income benefit component, if any, determined on grant date. For nonemployees and for non-Israeli employees, the share option plan is subject to Section 3(i) of the Israeli Income Tax Ordinance. On August 30, 2018 the Company's compensation committee, followed by the Board of Directors, approved the amended and restated company's 2012 Plan. On October 4, 2018 the company's amended and restated 2012 stock plan was approved at the annual general meeting of shareholders. As part of the company's 2012 Plan’s amendments it was determined that if the Company declares a cash dividend to its shareholders, and the distribution date of such dividend will precede the exercise date of an Option, including for the avoidance of doubt, Options that have yet to become vested and Options which have been granted prior to the adoption of such amendment to the plan, the exercise price of the Option shall be reduced in the amount equal to the cash dividend per share distributed by the Company. The result of the modification was an incremental cost of $74 in the financial statement for 2018. During 2018 the option pool was increased by 300,000 to an aggregate option pool of 980,000 options following the approvals of the Company's Audit Committee, Board of Directors and shareholders of the company. (1) On March 6, 2017, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 30,000 Options, at an exercise price of $8.9 per share, to senior executive. (2) On August 10, 2017, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 45,000 Options, at an exercise price of $11.39 per share, to senior executive. (3) On October 30, 2017, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 80,000 Options, at an exercise price of $11.54 per share, to senior executives, which were granted on January 2, 2018. (4) On February 6, 2018, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 3,893 Options, at an exercise price of $11.11 per share, to senior executives. (5) On February 28, 2018, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 50,000 Options, at an exercise price of $10.74 per share, to senior executive. (6) On May 13, 2018, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 70,000 Options, at an exercise price of $9.12 per share, to senior executive. (7) On November 22, 2018, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 70,000 Options, at an exercise price of $7.35 per share, to senior executives. (8) On August 29, 2019, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 70,000 Options, at an exercise price of $5.65 per share, to senior executives. (9) On September 22, 2019, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 50,000 Options, at an exercise price of $5.32 per share, to senior executive. (10) On September 26, 2019, pursuant to the 2012 Plan, TAT’s Board of Directors approved the grant of 50,000 Options, at an exercise price of $5.26 per share, to senior executive. The fair value of the Company’s stock options granted under the 2012 plan for the years ended December 31, 2019, 2018 and 2017 was estimated using the following assumptions: 2019 2018 2017 Expected stock price volatility 34.2% – 36.8% 32.6% – 40.8% 33.3% – 40.5% Expected option life (in years) 3.5-5 3.5-5.5 4 – 5.5 Risk free interest rate 1.44% – 1.63% 1.71% – 2.87% 1.49% – 1.81% Dividend yield 0% 0% 5% The Company uses the Black-Scholes option pricing model to determine the weighted average fair value of options. The volatility factor used in the Black-Scholes option pricing model is based on historical stock price fluctuations. The expected term of options is based on the simplified method. The Company is able to use the simplified method as the options qualify as “plain vanilla” options as defined by ASC 718-10-S99 and since the Company does not have sufficient historical exercise data to provide a reasonable basis to estimate expected term. Expected dividend yield is based upon historical and projected dividend activity and the risk-free interest rate assumption is based on observed interest rates appropriate for the expected term of the stock options granted. Following the company's amended and restated 2012 stock plan related to the adjustment of the exercise price in respect of dividend distribution, the dividend yield was amended to 0%. (11) The following table is a summary of the activity of TAT's Stock Option plan: Year ended December 31, Year ended December 31, Year ended December 31, 2019 2018 2017 Number of options Weighted average exercise price Number of options Weighted average exercise price Number of options Weighted average exercise price Outstanding at the beginning of the year 548,267 $ 9.03 365,000 $ 8.53 330,000 $ 7.97 Granted 170,000 5.44 273,893 9.70 75,000 10.39 Forfeited (126,808 ) 11.19 (63,958 ) 9.85 (20,417 ) 7.47 Exercised - - (26,668 ) 7.15 (19,583 ) 7.3 Outstanding at the end of the year 591,459 7.53 548,267 $ 9.03 365,000 $ 8.53 Exercisable at the end of the year 264,389 $ 7.74 163,438 $ 8.34 120,417 $ 7.95 The weighted-average grant-date fair value of options granted was $1.35 in 2019, $1.83 in 2018 and $1.74 in 2017. The aggregate intrinsic value for the options outstanding as of December 31, 2019, 2018 and 2017 was $0, $737 and $332, respectively. As of December 31, 2019 total unrecognized compensation cost was $230 and is expected to be recognized over a weighted-average period of 1.08 years. c. Dividends On May 17, 2017, TAT’s Board declared a cash dividend in the total amount of $3 million (approximately NIS 10.8 million), or $0.34 per share (approximately NIS 1.2 per share), for all of the shareholders of TAT. The dividend was paid on June 21, 2017 to shareholders of record on June 7, 2017. |
EARNINGS PER SHARE (EPS)
EARNINGS PER SHARE (EPS) | 12 Months Ended |
Dec. 31, 2019 | |
Weighted average number of shares outstanding: | |
EARNINGS PER SHARE ("EPS") | NOTE 14 - EARNINGS PER SHARE (“EPS”) Basic and diluted earnings per share are based on the weighted average number of ordinary shares outstanding. Diluted EPS is based on those shares used in basic EPS plus shares that would have been outstanding assuming issuance of ordinary shares for all dilutive potential ordinary shares outstanding. Year ended December 31, 2019 2018 2017 Numerator for EPS: Net income (loss) $ 806 $ (4,408 ) $ 2,396 Denominator for EPS: Weighted average shares outstanding – basic 8,874,696 8,864,885 8,848,028 Dilutive shares - - 61,044 Weighted average shares outstanding – diluted 8,874,696 8,864,885 8,909,072 EPS: Basic and diluted $ 0.1 $ (0.5 ) $ 0.27 Diluted income per share does not include 482,282, 306,151 and 105,000 options, for the years ended December 31, 2019, 2018 and 2017 respectively because the options are anti-dilutive. Dilutive shares are calculated using the treasury stock method and include dilutive shares from share-based employee compensation plans. |
TAXES ON INCOME
TAXES ON INCOME | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 15 - TAXES ON INCOME a. Tax benefits under the Law for the Encouragement of Capital Investments, 1959 ("the Law"): Until December 31, 2010, TAT and Turbochrome has elected to participate in the alternative package of tax benefits for its approved and benefited enterprise under the law. Pursuant to such Law, the income derived from those enterprises will be exempt from Israeli corporate tax for a specified benefit period (except to the extent that dividends are distributed during the tax-exemption period other than upon liquidation) and subject to reduced corporate tax rates for an additional period. In the event of distribution of a dividend from income which was tax exempt as above, the company would have to pay a regular corporate tax rate in respect of the amount distributed. Preferred Enterprises Additional amendments to the Law became effective in January 2011 (the “2011 Amendment”). Under the 2011 Amendment, income derived by ‘Preferred Companies’ from ‘Preferred Enterprises’ (both as defined in the 2011 Amendment) would be subject to a uniform rate of corporate tax as opposed to the incentives that are limited to income from Approved or Benefiting Enterprises during their benefits period. According to the 2011 Amendment, the uniform tax rate on such income, referred to as ‘Preferred Income’, would be 10% in areas in Israel that are designated as Development Zone A and 15% elsewhere in Israel during 2011-2012, 7% and 12.5%, respectively, in 2013-2014, and 6% and 12%, respectively, thereafter. Dividends distributed from taxable income derived from Preferred Enterprise would be subject to a 15% tax (or lower, if so provided under an applicable tax treaty), which would generally be withheld by the distributing company .While the Company may incur additional tax liability in the event of distribution of dividends from tax exempt income generated from its Approved and Benefiting Enterprises, no additional tax liability will be incurred by the Company in the event of distribution of dividends from income taxed in accordance with the 2011 Amendment. Under the transitional provisions of the 2011 Amendment, the Company elected to irrevocably implement the 2011 Amendment, commencing 2011 and thereafter, and be regarded as a "Preferred Enterprise" with respect to its existing Approved and Benefited Enterprises while waiving benefits provided under the legislation prior to the 2011 Amendment. Under a recent amendment, announced in August 2013, beginning in 2014, dividends paid out of income attributed to a Preferred Enterprise will be subject to a withholding tax rate of 20% (instead of 15%). In addition, tax rates under the Preferred Enterprise were also raised effective as of January 1, 2014 to 9% in Zone A and 16% elsewhere (instead of the 6% and 12%, respectively). The uniform tax rate for Development Zone A, as of January 1, 2017, is 7.5% (as part of changes enacted in Amendment 73). TAT is located in an area in Israel that is designated as elsewhere and as such entitled to reduce tax rates of 15% during 2011-2012, 12.5% in 2013, and 16% in 2014 and thereafter. Turbochrome is located in an area in Israel that is designated as Zone A and as such entitled to reduce tax rates of 10% during 2011-2012, 7% in 2013, and 9% in 2014, 2015 and 2016, and 7.5% in 2017 and thereafter. b. Corporate tax rate in Israel In January 2016, the Law for the Amendment of the Income Tax Ordinance (No.216) was published, enacting a reduction of corporate tax rate beginning in 2016 and thereafter, from 26.5% to 25%. In December 2016, additional legislation was enacted, reducing the corporate tax rate to 24% for 2017 and to 23% for 2018 and thereafter. There is no impact on the financial statements of the Company as a result of the changes in the Israeli corporate tax rate. Capital gain is subject to capital gain tax according to corporate tax rate in the year which the assets are sold. c. U.S. subsidiaries U.S. subsidiaries are taxed based on federal and state tax laws. The Federal statutory tax rate for 2019 was 21% plus 3%-6% for state taxes. d. Tax assessments TAT’s income tax assessments are considered final through 2014. Turbochrome income tax assessments are considered final through 2014. Limco-Piedmont income tax assessments are considered final through 2015. e. Income tax reconciliation: A reconciliation of the theoretical tax expense assuming all income is taxed at the statutory rate to taxes on income (tax benefit) as reported in the statements of income: Year ended December 31, 2019 2018 2017 Income (loss) before taxes on income (tax benefit) as reported in the statements of income $ 1,527 $ (5,732 ) $ 4,939 Statutory tax rate in Israel 23 % 23 % 24 % Theoretical taxes on income (tax benefit) $ 351 $ (1,318 ) $ 1,185 Increase (decrease) in taxes on income resulting from: Tax adjustment for foreign subsidiaries subject to a different tax rate (26 ) (9 ) 518 Reduced tax rate on income derived from "Preferred Enterprises" plans 305 421 (111 ) Earnings from foreign subsidiaries (1) 91 (338 ) 371 Valuation allowance for exchange rates differences on deferred taxes not recorded on capital losses (125 ) (42 ) 8 Change in tax rate - - 414 Tax in respect of prior years - (481 ) 7 Temporary differences for which no deferred taxes were recorded (55 ) 8 - Permanent differences 55 245 (104 ) Other adjustments (7 ) 50 45 Taxes on income as reported in the statements of income $ 589 $ (1,464 ) $ 2,333 (1) During 2019, 2018 and 2017, the Company recorded an accrual that related to a tax liability due to actual distribution of earnings from foreign subsidiaries of the Company and due to the possibility of future distribution of earnings from such foreign subsidiaries. f. Income (loss) before taxes on income (tax benefit) is comprised as follows: Year ended December 31, 2019 2018 2017 Domestic (Israel) $ (2,586 ) $ (5,261 ) $ 1,337 Foreign (United States) 4,113 (471 ) 3,602 $ 1,527 $ (5,732 ) $ 4,939 g. Taxes on income (tax benefit) included in the statements of income: Year ended December 31, 2019 2018 2017 Current: Domestic (Israel) $ - $ - $ 431 Foreign (United States) 139 (881 ) 1,937 139 (881 ) 2,368 Deferred: Domestic (Israel) (355 ) (813 ) 210 Foreign (United States) 805 711 (252 ) 450 (102 ) (42 ) Previous years: Foreign (United States) - (481 ) 7 - (481 ) 7 $ 589 $ (1,464 ) $ 2,333 h. Deferred income taxes: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of TAT's deferred tax liabilities and assets are as follows: December 31, 2019 2018 Deferred tax assets: Provision for doubtful accounts $ 67 $ 59 Provisions for employee benefits 470 267 Inventory 964 975 Intangible assets 42 100 Capital tax losses carryforward 3,500 3,375 Net operating losses carryforward 1,669 1,102 Other 96 288 Deferred tax assets, before valuation allowance $ 6,808 $ 6,166 Valuation allowance (3,500 ) (3,375 ) Deferred tax assets, net $ 3,308 $ 2,791 Deferred tax liabilities: Property, plant and equipment and intangible assets (2,159 ) (2,085 ) Earnings from foreign subsidiaries (1) (1,953 ) (1,862 ) Other temporary differences deferred tax liabilities (68 ) (166 ) Deferred tax liabilities $ (4,180 ) $ (4,113 ) Net $ (872 ) $ (1,322 ) (1) The Company record an accrual that related to a deferred tax liability due to the possibility of future distribution of earnings from foreign subsidiaries of the Company. The following table summarizes the changes in the valuation allowance for deferred tax assets: Balance, December 31, 2016 3,409 Additions during the year 8 Balance, December 31,2017 3,417 Deductions during the year (42 ) Balance, December 31,2018 $ 3,375 Additions during the year 125 Balance, December 31,2019 $ 3,500 Valuation allowance are mainly related to (i) U.S. subsidiary for which valuation allowance was provided in respect of deferred tax assets resulting from carryforward of State tax losses in the amount of $ 1,519. That amount is expected to expire gradually starting from 2024 and (ii) Capital losses attributed to the Company in the amount of $ 1,502. TAT does not intend to distribute tax-exempt earnings deriving from its Approved Enterprise aggregating approximately $1,936 as of December 31, 2019, and accordingly, no deferred tax liability has been established related to these earnings. If such tax-exempt income is distributed, it would be taxed at the reduced corporate tax rate applicable to such profits (23%) and an income tax liability of up to approximately $445 would be incurred as of December 31, 2019. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 16 - SEGMENT INFORMATION a. Segment Activities Disclosure: TAT operates under four segments: (i) Original equipment manufacturing (“OEM”) of heat transfer solutions and aviation accessories through its Gedera facility; (ii) MRO services for heat transfer components and OEM of heat transfer solutions through its Limco subsidiary; (iii) MRO services for aviation components through its Piedmont subsidiary; and (iv) Overhaul and coating of jet engine components through its Turbochrome subsidiary. - OEM of heat transfer solutions and aviation accessories primarily include the design, development and manufacture of (i) broad range of heat transfer solutions, such as pre-coolers heat exchangers and oil/fuel hydraulic heat exchangers, used in mechanical and electronic systems on board commercial, military and business aircraft; (ii) environmental control and power electronics cooling systems installed on board aircraft in and ground applications; and (iii) a variety of other mechanical aircraft accessories and systems such as pumps, valves, and turbine power units. - MRO Services for heat transfer components and OEM of heat transfer solutions primarily include the MRO of heat transfer components and to a lesser extent, the manufacturing of certain heat transfer solutions. TAT’s Limco subsidiary operates an FAA-certified repair station, which provides heat transfer MRO services for airlines, air cargo carriers, maintenance service centers and the military. - MRO services for aviation components include the MRO of APUs, landing gears and other aircraft components. TAT’s Piedmont subsidiary operates an FAA-certified repair station, which provides aircraft component MRO services for airlines, air cargo carriers, maintenance service centers and the military. - TAT’s activities in the area of overhaul and coating of jet engine components includes the overhaul and coating of jet engine components, including turbine vanes and blades, fan blades, variable inlet guide vanes and afterburner flaps. The Group’s chief operating decision-maker (CEO of the Company) evaluates performance, makes operating decisions and allocates resources based on financial data, consistent with the presentation in the accompanying financial statements. CODM reviews revenue, gross profit, operating income and the following assets: Cash, accounts receivable and inventory. b. Segments statement operations disclosure: The following financial information is the information that management uses for analyzing the segment results. The figures are presented in consolidated method as presented to management. The following financial information is a summary of the operating income of each operational segment: Year ended December 31, 2019 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 20,552 $ 34,183 $ 38,687 $ 8,610 $ - $ 102,032 Intersegment revenues 6,037 250 - - (6,287 ) - Total revenues 26,589 34,433 38,687 8,610 (6,287 ) 102,032 Cost of revenues 23,998 27,852 33,337 7,751 (6,468 ) 86,470 Gross profit 2,591 6,581 5,350 859 181 15,562 Research and development 58 83 7 (74 ) - 74 Selling and marketing 1,530 1,638 1,334 757 - 5,259 General and administrative 1,978 2,734 2,408 1,131 - 8,251 Operating income (loss) $ (975 ) $ 2,126 $ 1,601 $ (955 ) $ 181 $ 1,978 Financial expenses, net 451 Income before taxes on income 1,527 Year ended December 31, 2018 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 20,065 $ 30,929 $ 32,487 $ 9,697 $ - $ 93,178 Intersegment revenues 4,642 415 - - (5,057 ) - Total revenues 24,707 31,344 32,487 9,697 (5,057 ) 93,178 Cost of revenues 25,612 27,659 28,561 8,298 (5,343 ) 84,787 Gross profit (loss) (905 ) 3,685 3,926 1,399 286 8,391 Research and development 287 98 - 168 - 553 Selling and marketing 1,512 1,660 1,324 417 - 4,913 General and administrative 2,384 2,375 2,631 1,169 - 8,559 Other income (2 ) - (2 ) - - (4 ) Operating income (loss) $ (5,086 ) $ (448 ) $ (27 ) $ (355 ) $ 286 $ (5,630 ) Financial expenses, net 102 Loss before taxes on income (5,732 ) Year ended December 31, 2017 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 27,898 $ 34,615 $ 33,009 $ 11,005 $ - $ 106,527 Intersegment revenues 3,339 197 - - (3,536 ) - Total revenues 31,237 34,812 33,009 11,005 (3,536 ) 106,527 Cost of revenues 25,535 26,085 29,026 9,057 (3,620 ) 86,083 Gross profit 5,702 8,727 3,983 1,948 84 20,444 Research and development 398 169 - 164 - 731 Selling and marketing 1,968 1,358 1,213 435 - 4,974 General and administrative 2,072 3,182 3,049 1,106 - 9,409 Other expenses - - 53 - - 53 Operating income (loss) $ 1,264 $ 4,018 $ (332 ) $ 243 $ 84 $ 5,277 Financial expenses, net 338 Income before taxes on income 4,939 c. The following financial information identifies the assets, depreciation and amortization, and capital expenditures to segments: Year ended December 31, 2019 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 29,149 31,031 34,264 10,194 10,037 114,675 Depreciation and amortization 1,601 1,031 786 954 - 4,372 Expenditure for segment assets 1,600 1,180 803 239 - 3,822 Year ended December 31, 2018 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 26,171 33,794 27,687 11,100 4,535 103,287 Depreciation and amortization 1,476 1,044 705 960 - 4,185 Expenditure for segment assets 2,665 588 764 144 - 4,161 Year ended December 31, 2017 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 29,411 35,067 27,276 11,915 8,326 111,995 Depreciation and amortization 1,299 1,029 653 960 - 3,941 Expenditure for segment assets 1,769 866 847 402 - 3,884 |
ENTITY-WIDE DISCLOSURE
ENTITY-WIDE DISCLOSURE | 12 Months Ended |
Dec. 31, 2019 | |
Segments, Geographical Areas [Abstract] | |
ENTITY-WIDE DISCLOSURE | NOTE 17 - ENTITY-WIDE DISCLOSURE a. Total revenues - by geographical location were attributed according to customer residential country as follows: Year ended December 31, 2019 2018 2017 Total revenues Total revenues Total revenues Sale of products Israel $ 3,464 $ 2,893 $ 6,289 United States 14,181 13,013 19,004 Other 7,374 7,245 10,760 $ 25,019 $ 23,151 $ 36,053 Year ended December 31, 2019 2018 2017 Total revenues Total revenues Total revenues Sale of Services Israel $ 3,624 $ 4,031 $ 3,704 United States 47,749 41,019 40,047 Other 25,640 24,977 26,723 $ 77,013 $ 70,027 $ 70,474 b. Total long-lived assets - by geographical location were as follows: December 31, 2019 2018 Israel $ 16,318 $ 12,894 United States 11,354 8,530 Total $ 27,672 $ 21,424 c. Major Customers No single customer accounted for 10% or more of Group's total net revenue in any year presented. |
SUPPLEMENTAL CONSOLIDATED BALAN
SUPPLEMENTAL CONSOLIDATED BALANCE SHEETS INFORMATION | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SUPPLEMENTAL CONSOLIDATED BALANCE SHEETS INFORMATION | NOTE 18 - SUPPLEMENTAL CONSOLIDATED BALANCE SHEETS INFORMATION Warranty provision Provision for doubtful Accounts Balance, as of December 31, 2016 338 302 Additions 154 361 Deductions (186 ) (40 ) Balance, as of December 31, 2017 306 623 Additions 214 135 Deductions (235 ) (482 ) Balance, as of December 31, 2018 $ 285 $ 276 Additions 115 84 Deductions (165 ) (46 ) Balance, as of December 31, 2019 $ 235 $ 314 |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Group's financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). |
Use of estimates in the preparation of financial statement | Use of estimates in the preparation of financial statement The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose the nature of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting years. Actual results could differ from those estimates. As applicable to these financial statements, the most significant estimates and assumptions relate to: recoverability of inventory, provision for doubtful accounts and income taxes. |
Functional currency | Functional currency The majority of the revenues of each subsidiary in the Group are generated in U.S. dollars ("dollars") and a substantial portion of the costs of each subsidiary in the Group are incurred in dollars. Accordingly, the dollar is the currency of the primary economic environment in which the Group operates and accordingly its functional and reporting currency is the dollar. Transactions and balances originally denominated in dollars are presented at their original amounts. Balances in currencies other than the U.S. dollar are translated into dollars using historical and current exchange rates for non-monetary and monetary balances, respectively. For non-dollar transactions and other items in the statements of income (indicated below), the following exchange rates are used: (i) for transactions – exchange rates at transaction dates or average rates; and (ii) for other items (derived from non-monetary balance sheet items such as depreciation and amortization, etc.) – historical exchange rates. Currency transaction gains and losses are carried to financial income or expenses, as appropriate. |
Principles of consolidation | Principles of consolidation The consolidated financial statements include the accounts of TAT and its subsidiaries. Intercompany balances and transactions, including profits from intercompany sales not yet realized outside the Group, have been eliminated upon consolidation. |
Cash and Cash equivalents | Cash and Cash equivalents All highly liquid investments, which include short-term bank deposits, that are not restricted as to withdrawal or use, and short-term debentures, the period to maturity of which do not exceed three months at the time of investment, are considered to be cash equivalents. |
Short-term bank deposits | Short-term bank deposits |
Accounts receivable, net | Accounts receivable, net The Group’s accounts receivable balances are due from customers primarily in the airline and defense industries. Credit is extended based on evaluation of a customer’s financial condition and generally, collateral is not required. Trade accounts receivable from sales of services and products are typically due from customers within 30 - 90 days. Trade accounts receivable balances are stated at amounts due from customers net of a provision for doubtful accounts. Accounts outstanding longer than their original contractual payment terms are considered past due. The Group determines its allowance by considering a number of factors, including the length of time accounts receivable are past due, the Group’s previous loss history from such customers, the customer’s current ability to pay its obligation to TAT and the condition of the general economy and the industry as a whole. The Group writes-off accounts receivable when they become uncollectible. Payments subsequently received on such receivables are credited against earnings. The provision for doubtful accounts is determined with respect to specific debts that are doubtful of collection. |
Inventory | Inventory Inventory is measured at the lower of cost and net realizable value. Inventories include raw materials, parts, work in progress and finished products. Cost of raw material and parts is determined using the “moving average” basis. Cost of work in progress and finished products is calculated based on actual costs. Capitalized production costs components, mainly labor and overhead, are determined on average basis over the production period. If actual market prices are less favorable than those projected by management, inventory write-downs may be required. Once written-down, a new lower cost basis for that inventory is established. Since the Group sells products and services related to airplane accessories for airplanes that can be in service for 20 to 50 years, it must keep a supply of such products and parts on hand while the airplanes are in use. The Group writes down its inventory for estimated obsolescence and unmarketable inventory equal to the difference between the cost of inventory and estimated market value based upon assumptions for future demand and market conditions. |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment are stated at cost, after deduction of the related investment grants, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Years Buildings and leasehold improvements 7 - 39 Machinery and equipment 3 - 17 Motor vehicles 6 - 7 Office furniture and equipment 3 - 17 Software 3-5 Leasehold improvements are included in buildings and amortized using the straight line method over the period of the lease contract, or the estimated useful life of the asset, whichever is shorter. |
Grants from Israel Innovation Authority (IIA) | Grants from Israel Innovation Authority (IIA): Grants received from the IIA for approved research and development projects are recognized at the time the Company is entitled to such grants, on the basis of the costs incurred and included as a deduction from research and development expenses. Due the fact that the Company is defined as a "Traditional Industry Company", under the IIA regulations, the majority of grants are non-royalty bearing. |
Investment in affiliates and share in results of equity investment of affiliated companies | Investment in affiliates and share in results of equity investment of affiliated companies Investment in which the Group exercises significant influence and which is not considered a subsidiary ("affiliate") is accounted for using the equity method, whereby the Group recognizes its proportionate share of the affiliated company's net income or loss after the date of investment. See Note 5. The Group reviews those investments for impairment whenever events indicate the carrying amount may not be recoverable. See Note 1(c). Transactions between the Group and the affiliate are eliminated on consolidation. Profits or losses are eliminated only on assets still remaining on the books of the Group or the affiliate. |
Leases | Leases On January 1, 2019 the Company adopted ASU No. 2016-02, Leases (Topic 842), The Company determines if an arrangement is a lease at inception. Balances related to operating leases are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized as of the commencement date based on the present value of lease payments over the lease term. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The discount rate for the lease is the rate implicit in the lease unless that rate cannot be readily determined. As the Company’s leases do not provide an implicit rate, the Company’s uses its estimated incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Lease expense for lease payments is recognized on a straight-line basis over the lease term (see also note 2aa). |
Identified intangible assets | Identified intangible assets Identifiable intangible assets are comprised of definite lived intangible assets - customer relationships, which are amortized using the straight-line method over their estimated period of useful life as determined by identifying the period in which substantially all of the cash flows are expected to be generated. Amortization of customer relationships is recorded under selling and marketing expenses. |
Impairment of long-lived assets | Impairment of long-lived assets Long-lived assets, including property, plant and equipment, operating lease right of use assets and definite life intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets (or asset group) may not be recoverable. In the event that the sum of the expected future cash flows (undiscounted and without interest charges) of the long-lived assets (or asset group) is less than the carrying amount of such assets, an impairment charge would be recognized and the assets (or asset group) would be written down to their estimated fair values (see also notes 5 and 6). |
Treasury Shares | Treasury Shares Company shares held by the Company are presented as a reduction of equity at their cost to the Company. The treasury shares have no rights. |
Revenue recognition | Revenue recognition The Group generates its revenues from the sale of OEM products and systems, providing MRO services (remanufacture, maintenance, repair and overhaul services and long - term service contracts) and parts services. In May 2014, FASB issued Accounting Standards Update "Revenue from Contracts with Customers" (Topic 606). To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the performance obligation is satisfied. Other major provisions include capitalization of certain contract costs, consideration of the time value of money in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. The guidance permitted the use of either a retrospective or cumulative effect transition method. The Company has implemented the new standard on its effective date (January 1, 2018) to uncompleted contracts as of that date, in accordance with the transitional directive which allows recognition of the cumulative effect of the initial application as an adjustment to the opening balance of retained earnings as of January 1, 2018. The adoption of ASC 606 did not impact the Company’s balance sheet or opening balance of retained earnings. The Company has adopted the following exemptions and accounting policies: a. The Company has chosen to account for shipping as a fulfillment costs, in cases in which the shipping occurs after the customer has obtained control of a good. b. The Company has chosen not to adjust the promised amount of consideration for the effects of a significant financing component, in cases in which the Company expects, at contract inception, that the period between when the Company transfers a promised good or service to the customer and when the customer pays for that good or service will be one year or less. c. The Company has chosen to present all sales taxes collected from customers on a net basis. Prior to January 1, 2018 and before the adoption of ASC 606, revenues from multi-year, fixed price contracts for OEM customers were recognized when a product was shipped (and title passed) to the customer. After the adoption of ASC 606, the group recognizes revenues from the sale of OEM products when it satisfies a performance obligation, i.e. when or as the customer obtains control upon product shipment. The Group does not grant a right of return. Prior to January 1, 2018 and before the adoption of ASC 606, revenues from MRO services were generally recognized when services were completed. In cases in which contracts required exchanging a defective landing gear for a restored gear, the non-refundable minimum amounts from these contracts were recognized on the exchange date (delivery of the product has occurred), and any additional amounts billed to the customer for excess hours of repair, were recognized when the customer approved the price for these additional services. After the adoption of ASC 606, the Group recognizes revenues from MRO services over time as it satisfies its performance obligations. The Group satisfies its performance, according to required milestones. |
Warranty costs | Warranty costs The Group provides warranties for its products and services ranging from one to three years, which vary with respect to each contract and in accordance with the nature of each specific product. According to past experience, most of the warranty costs incur during the first year of the contract. The Group estimates the costs that may be incurred under its warranty and records a liability in the amount of such costs at the time revenue is recognized. The Group periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. |
Research and development | Research and development Research and development costs, net of grants, are charged to expenses as incurred. |
Fair value measurement | Fair value measurement The Group measures fair value and discloses fair value measurements for financial assets and liabilities. Fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standard establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data or active market data for similar but not identical assets or liabilities. Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs. In determining fair value, the Group utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible and considers credit risk in its assessment of fair value. |
Concentrations of credit risk | Concentrations of credit risk Financial instruments that potentially subject the Group to concentrations of credit risk consist principally of cash and cash equivalents, derivatives and accounts receivable. Cash and cash equivalents are deposited with major banks in Israel and the United States. Such deposits in the United States may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Group's cash and cash equivalents are financially sound. Accordingly, minimal credit risk exists with respect to these financial instruments. The Group's accounts receivable are derived mainly from sales to customers in the United States, Israel and Europe. The Group generally does not require collateral; however, in certain circumstances the Group may require letters of credit. Management believes that credit risks relating to accounts receivable are minimal since the majority of the Group's customers are world-leading manufacturers of aviation systems and aircrafts, international airlines, governments and air-forces, and world-leading manufacturers and integrators of defense and ground systems. In addition, the Group has relatively a large number of customers with wide geographic spread which mitigates the credit risk. The Group performs ongoing credit evaluation of its customers' financial condition. |
Income taxes | Income taxes Income taxes are accounted for in accordance with ASC 740 "Income Taxes". This statement prescribes the use of the asset and liability method, whereby deferred tax assets and liabilities account balances are determined based on temporary differences between financial reporting and tax basis of assets and liabilities and for tax loss carry-forwards. Deferred taxes are measured using the enacted laws and tax rates that will be in effect when the differences are expected to reverse. The Group provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value, see note 13(h). Taxes which would apply in the event of disposal of investments in foreign subsidiaries have not been taken into account in computing the deferred taxes, when the Group’s intention is to hold, and not to realize the investments. Taxes which would apply in the event of distribution of earnings from foreign subsidiaries of the Company, have been taken into account in computing the deferred taxes, when there is a possibility of future distribution of earnings from such foreign subsidiaries. The Group did not provide for deferred taxes attributable to dividend distribution out of retained tax-exempt earnings from "Approved/Benefited Enterprise" plans (see note 13(a)), since it intends to permanently reinvest them and has no intention to declare dividends out of such tax exempt income in the foreseeable future. Management considers such retained earnings to be essentially permanent in duration. The payment of dividend in 2017 and 2016 was paid from foreign subsidiaries earnings of the Company and earnings from regular income of the Israeli company, respectively. Results for tax purposes for TAT’s Israeli subsidiaries are measured and reflected in NIS. As explained in (c) above, the consolidated financial statements are measured and presented in U.S. dollars. In accordance with ASC 740, TAT has not provided deferred income taxes on the differences resulting from changes in exchange rate and indexation. The Group follows a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate resolution. The Group’s policy is to include interest and penalties related to unrecognized tax benefits within financial income (expense). Such liabilities are classified as long-term, unless the liability is expected to be resolved within twelve months from the balance sheet date. |
Earnings per share | Earnings per share Basic earnings (loss) per share are computed by dividing net income (loss) by the weighted average number of shares of the Company's Ordinary Shares, par value NIS 0.9 per share outstanding for each period. Diluted earnings (loss) per share are calculated by dividing the net income by the fully-diluted weighted-average number of ordinary shares outstanding during each period. Potentially dilutive shares include outstanding options granted to employees and directors, using the treasury stock method. |
Share-based compensation | Share-based compensation The Group applies ASC 718 "Stock Based Compensation" with respect to employees and directors’ options, which requires awards classified as equity awards to be accounted for using the grant-date fair value method. The fair value of share-based awards is estimated using the Black-Scholes valuation model, the payment transaction is recognized as expense over the requisite service period, net of estimated forfeitures. The Company estimates forfeitures based on historical experience and anticipated future conditions. The Group recognizes compensation cost for an award with only service conditions that has a graded vesting schedule using the accelerated method over the requisite service period for the entire award. |
Comprehensive income (loss) | Comprehensive income (loss) Comprehensive income in 2019, 2018 and 2017 includes, in addition to net income or loss, gains and losses of derivatives (net of related taxes where applicable). Reclassification adjustments for gain or loss of derivatives are included in the relevant line item in the statement of income. See also note 2 (z). |
Contingencies | Contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Group but which will only be resolved when one or more future events occur or fail to occur. The Group’s management assesses such contingent liabilities and estimated legal fees, if any, and accrues for these costs. Such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Group or unasserted claims that may result in such proceedings, the Group’s management evaluates the perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought. Management applies the guidance in ASC 450-20-25 when assessing losses resulting from contingencies. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability is recorded as accrued expenses in the Company’s financial statements. If the assessment indicates that a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material are disclosed. Loss contingencies considered to be remote by management are generally not disclosed unless they involve guarantees, in which case the guarantee would be disclosed. |
Derivatives and hedging | Derivatives and hedging The Company carries out transactions involving foreign currency exchange derivative financial instruments. The transactions are designed to hedge the Company’s exposure in currencies other than the U.S. dollar. The Company recognizes derivative instruments as either assets or liabilities and measures those instruments at fair value. For derivative instruments that are designated and qualify as a cash-flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the anticipated transaction in the same period or periods during which the hedged transaction affects earnings. The ineffective portion of a derivative designated as a cash flow hedge is recognized in "financial expense (income), net". If a derivative does not meet the definition of a cash flow hedge, the changes in the fair value are included in "financial expense (income), net". After the adoption of ASU 2017-12, the main effect is that the overall influence of the hedging appears under the same line of the hedged item and not under "financial expense (income), net". For derivative instruments that qualify for hedge accounting, the cash flows associated with these derivatives are reported in the consolidated statements of cash flows consistently with the classification of the cash flows from the underlying hedged items that these derivatives are hedging. |
Recently Issued Accounting Principles: | Recently Issued Accounting Principles: Recently adopted accounting pronouncements: 1) The Company adopted ASU No. 2016-02, Leases (Topic 842), on January 1, 2019 using the modified retrospective transition approach by applying the new standard to all leases existing at the date of initial application. Results and disclosure requirements for reporting periods beginning after January 1, 2019 are presented under Topic 842, while prior period amounts have not been adjusted and continue to be reported in accordance with its historical accounting under Topic 840. The Company elected the package of practical expedients permitted under the transition guidance, which allowed to carryforward the Company’s historical lease classification, the Company’s assessment on whether a contract was or contains a lease, and the Company’s initial direct costs for any leases that existed prior to January 1, 2019. The Company also elected to combine lease and non-lease components and to keep leases with an initial term of 12 months or less off the balance sheet and recognize the associated lease payments in the consolidated statements of income on a straight-line basis over the lease term. Upon adoption, the new standard resulted in an increase of $7.3 million in operating lease ROU assets and corresponding liabilities on the Company’s consolidated balance sheet. The weighted-average interest rate used to discount future lease payments was 4.84% for the assets in the USA and 4.5% for the Israeli assets. 2) In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-12, Derivatives and Hedging (Topic 815), Targeted Improvements to Accounting for Hedging Activities. Among other things, the guidance eliminated the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. As ASU 2017-12 was effective for fiscal years beginning after December 15, 2018, the Company adopted the ASU on January 1, 2019 with no material impact on the Company’s consolidated financial statements. Accounting pronouncements issued but not yet adopted: (1) In June 2016, the FASB issued guidance on financial instruments. The guidance replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The guidance will be effective for the fiscal year beginning on January 1, 2020, including interim periods within that year. The new standard will not have a material effect on the Company's financial statements upon adoption. (2) In December 2019, the FASB issued ASU 2019-12, “Simplifying the Accounting for Income Taxes. (Topic 740)” ("the Update"). The amendments in this Update simplify the accounting for income taxes by removing the following exceptions in ASC 740: 1. Exception to the incremental approach for intra-period tax allocation when there is a loss from continuing operations and income or a gain from other items; 2. Exception to the requirement to recognize a deferred tax liability for equity method investments when a foreign subsidiary becomes an equity method investment; 3. Exception to the ability not to recognize a deferred tax liability for a foreign subsidiary when a foreign equity method investment becomes a subsidiary;4. Exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. In addition, this Update also simplify the accounting for income taxes in certain topics as follows: 1. Requiring that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax; 2. Requiring that an entity evaluate when a step up in the tax basis of goodwill should be considered part of the business combination in which the book goodwill was originally recognized and when it should be considered a separate transaction;3. Specifying that an entity can elect (rather than required to) allocate the consolidated amount of current and deferred tax expense to a legal entity that is not subject to tax in its separate financial statements;4. Requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company is currently evaluating the effects of this Update on its consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of Property, Plant and Equipment Estimated Useful Lives | Property, plant and equipment are stated at cost, after deduction of the related investment grants, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, as follows: Years Buildings and leasehold improvements 7 - 39 Machinery and equipment 3 - 17 Motor vehicles 6 - 7 Office furniture and equipment 3 - 17 Software 3-5 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | The Company's financial assets and liabilities measured at fair value on a recurring basis, consisted of the following types of instruments: December 31, 2019 Level 1 Level 2 Level 3 Total Assets: Derivative financial instruments - $ 27 - $ 27 December 31, 2018 Level 1 Level 2 Level 3 Total Assets: Derivative financial instruments - $ 210 - $ 210 |
INVENTORY (Tables)
INVENTORY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Net | Inventory is composed of the following: December 31, 2019 2018 Raw materials and components $ 13,296 $ 10,758 Work in progress 11,735 7,297 Spare parts 18,272 19,557 Finished goods 604 993 Total inventory (**) $ 43,907 $ 38,605 |
INVESTMENT IN AFFILIATES (Table
INVESTMENT IN AFFILIATES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investments in and Advances to Affiliates [Abstract] | |
Summary of Financial Information | Summarized financial information of TAT-Engineering LLC: December 31, 2019 2018 Balance sheets: Current assets $ 466 $ 919 Non-current assets 1,383 1,436 Current liabilities 1,040 1,254 Non-current liabilities - - Year ended December 31, 2019 2018 2017 Statements of operation: Revenues $ 877 $ 1,534 $ 604 Gross loss (228 ) (154 ) (216 ) Loss from continuing operations (291 ) (266 ) (412 ) Net losses attributable to the Company (132 ) (140 ) (210 ) |
PROPERTY, PLANT AND EQUIPMENT_2
PROPERTY, PLANT AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Composition of assets, grouped by major classifications, is as follows: December 31, 2019 2018 Cost: Land and buildings $ 14,863 $ 13,077 Machinery and equipment 52,872 51,017 Motor vehicles 410 410 Office furniture and equipment 1,811 1,802 Software 1,420 1,248 71,376 67,554 Less: Accumulated depreciation 50,368 46,130 Depreciated cost $ 21,008 $ 21,424 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Lessee Disclosure [Abstract] | |
Schedule of Lease Cost | The lease cost was as follows: Year ended December 31, 2019 Operating lease expenses 1,297 |
Schedule of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows: Year ended December 31, 2019 Operating cash flows from operating leases 354 |
Schedule of Operating Cash Flows | Supplemental information for amounts included in the measurement of lease liabilities are as follows: December 31, 2019 Operating Leases Operating lease right-of-use assets 6,664 Current operating lease liabilities 1,330 Non-current operating lease liabilities 5,688 Total operating lease liabilities 7,018 Weighted Average Remaining Lease Term Operating leases - Israel 5 years Operating leases - United States 6 years Operating leases - Israel 4.5 % Operating leases - United States 4.84 % |
Schedule of Maturities of Lease Liabilities | As of December 31, 2019, the maturities of lease liabilities were as follows: Year Amount 2020 $ 1,626 2021 1,461 2022 1,314 2023 1,250 2024 and after 1,827 Total lease payments 7,478 Less imputed interest (460 ) Total $ 7 , |
Schedule of Minimum Lease Payments | As of December 31, 2018, the minimum lease payments of the Company, were as follows: Year Amount 2019 $ 1,551 2020 1,488 2021 1,330 2022 1,224 2023 and after 2,719 Total $ 8,312 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets: December 31, 2019 2018 Customer relationships Cost $ 1,342 $ 1,342 Accumulated amortization (565 ) (431 ) Amortized cost $ 777 $ 911 |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Other Account Payable and Accrued Expenses | December 31, 2019 2018 Employees and payroll accruals $ 3,332 $ 2,869 Accrued expenses 937 840 Authorities 810 677 Advances from customers 513 483 Warranty provision 235 285 Accrued royalties and rebate sales commissions 1,517 966 Other 49 291 $ 7,393 $ 6,411 |
RELATED PARTIES' TRANSACTIONS_2
RELATED PARTIES' TRANSACTIONS AND BALANCES (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of Transactions with Related Parties | Transactions: Year ended December 31, 2019 2018 2017 Income - Sales to related-party company (*) $ 596 $ 1,251 $ 959 Cost and expenses - Supplies from related party (*) $ 552 $ 59 $ 6 |
Schedule of Balances with Related Parties | Balances: December 31, 2019 2018 Trade receivables and other receivables (*) $ 706 $ 699 Trade payables and other payables (*) $ 154 $ - (*) includes mainly transactions with affiliated companies. |
LONG-TERM EMPLOYEE-RELATED OB_2
LONG-TERM EMPLOYEE-RELATED OBLIGATIONS (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Expected Future Benefits | TAT expects to pay $1,026 in future benefits to their employees during 2020 through 2029 upon their normal retirement age. The amount was determined based on the employee’s current salary rates and the number of service years that will be accumulated upon the retirement date. These amounts do not include amounts that might be paid to employees that will cease working for the Israeli company before their normal retirement age. Year Amount 2020 $ 341 2021 55 2022 9 2023 147 2024 48 Thereafter (through 2029) 426 Total $ 1,026 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stock Options Assumptions | The fair value of the Company’s stock options granted under the 2012 plan for the years ended December 31, 2019, 2018 and 2017 was estimated using the following assumptions: 2019 2018 2017 Expected stock price volatility 34.2% – 36.8% 32.6% – 40.8% 33.3% – 40.5% Expected option life (in years) 3.5-5 3.5-5.5 4 – 5.5 Risk free interest rate 1.44% – 1.63% 1.71% – 2.87% 1.49% – 1.81% Dividend yield 0% 0% 5% |
Schedule of Stock Option Activity | The following table is a summary of the activity of TAT's Stock Option plan: Year ended December 31, Year ended December 31, Year ended December 31, 2019 2018 2017 Number of options Weighted average exercise price Number of options Weighted average exercise price Number of options Weighted average exercise price Outstanding at the beginning of the year 548,267 $ 9.03 365,000 $ 8.53 330,000 $ 7.97 Granted 170,000 5.44 273,893 9.70 75,000 10.39 Forfeited (126,808 ) 11.19 (63,958 ) 9.85 (20,417 ) 7.47 Exercised - - (26,668 ) 7.15 (19,583 ) 7.3 Outstanding at the end of the year 591,459 7.53 548,267 $ 9.03 365,000 $ 8.53 Exercisable at the end of the year 264,389 $ 7.74 163,438 $ 8.34 120,417 $ 7.95 |
EARNINGS PER SHARE (EPS) (Table
EARNINGS PER SHARE (EPS) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Weighted average number of shares outstanding: | |
Schedule of Earnings per Share | Basic and diluted earnings per share are based on the weighted average number of ordinary shares outstanding. Diluted EPS is based on those shares used in basic EPS plus shares that would have been outstanding assuming issuance of ordinary shares for all dilutive potential ordinary shares outstanding. Year ended December 31, 2019 2018 2017 Numerator for EPS: Net income (loss) $ 806 $ (4,408 ) $ 2,396 Denominator for EPS: Weighted average shares outstanding – basic 8,874,696 8,864,885 8,848,028 Dilutive shares - - 61,044 Weighted average shares outstanding – diluted 8,874,696 8,864,885 8,909,072 EPS: Basic and diluted $ 0.1 $ (0.5 ) $ 0.27 |
TAXES ON INCOME (Tables)
TAXES ON INCOME (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Reconciliation of Tax Provisions to the Domestic and Effective Tax Rate | A reconciliation of the theoretical tax expense assuming all income is taxed at the statutory rate to taxes on income (tax benefit) as reported in the statements of income: Year ended December 31, 2019 2018 2017 Income (loss) before taxes on income (tax benefit) as reported in the statements of income $ 1,527 $ (5,732 ) $ 4,939 Statutory tax rate in Israel 23 % 23 % 24 % Theoretical taxes on income (tax benefit) $ 351 $ (1,318 ) $ 1,185 Increase (decrease) in taxes on income resulting from: Tax adjustment for foreign subsidiaries subject to a different tax rate (26 ) (9 ) 518 Reduced tax rate on income derived from "Preferred Enterprises" plans 305 421 (111 ) Earnings from foreign subsidiaries (1) 91 (338 ) 371 Valuation allowance for exchange rates differences on deferred taxes not recorded on capital losses (125 ) (42 ) 8 Change in tax rate - - 414 Tax in respect of prior years - (481 ) 7 Temporary differences for which no deferred taxes were recorded (55 ) 8 - Permanent differences 55 245 (104 ) Other adjustments (7 ) 50 45 Taxes on income as reported in the statements of income $ 589 $ (1,464 ) $ 2,333 (1) During 2019, 2018 and 2017, the Company recorded an accrual that related to a tax liability due to actual distribution of earnings from foreign subsidiaries of the Company and due to the possibility of future distribution of earnings from such foreign subsidiaries. |
Schedule of Income (Loss) from Continuing Operations Before Income Tax Domestic and Foreign | Income (loss) before taxes on income (tax benefit) is comprised as follows: Year ended December 31, 2019 2018 2017 Domestic (Israel) $ (2,586 ) $ (5,261 ) $ 1,337 Foreign (United States) 4,113 (471 ) 3,602 $ 1,527 $ (5,732 ) $ 4,939 |
Schedule of Components of Income Tax Provision | Taxes on income (tax benefit) included in the statements of income: Year ended December 31, 2019 2018 2017 Current: Domestic (Israel) $ - $ - $ 431 Foreign (United States) 139 (881 ) 1,937 139 (881 ) 2,368 Deferred: Domestic (Israel) (355 ) (813 ) 210 Foreign (United States) 805 711 (252 ) 450 (102 ) (42 ) Previous years: Foreign (United States) - (481 ) 7 - (481 ) 7 $ 589 $ (1,464 ) $ 2,333 |
Schedule of Deferred Tax Assets and Liabilities | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of TAT's deferred tax liabilities and assets are as follows: December 31, 2019 2018 Deferred tax assets: Provision for doubtful accounts $ 67 $ 59 Provisions for employee benefits 470 267 Inventory 964 975 Intangible assets 42 100 Capital tax losses carryforward 3,500 3,375 Net operating losses carryforward 1,669 1,102 Other 96 288 Deferred tax assets, before valuation allowance $ 6,808 $ 6,166 Valuation allowance (3,500 ) (3,375 ) Deferred tax assets, net $ 3,308 $ 2,791 Deferred tax liabilities: Property, plant and equipment and intangible assets (2,159 ) (2,085 ) Earnings from foreign subsidiaries (1) (1,953 ) (1,862 ) Other temporary differences deferred tax liabilities (68 ) (166 ) Deferred tax liabilities $ (4,180 ) $ (4,113 ) Net $ (872 ) $ (1,322 ) (1) The Company record an accrual that related to a deferred tax liability due to the possibility of future distribution of earnings from foreign subsidiaries of the Company. |
Schedule of changes in valuation allowance for deferred tax assets | The following table summarizes the changes in the valuation allowance for deferred tax assets: Balance, December 31, 2016 3,409 Additions during the year 8 Balance, December 31,2017 3,417 Deductions during the year (42 ) Balance, December 31,2018 $ 3,375 Additions during the year 125 Balance, December 31,2019 $ 3,500 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Operating Income by Segment | The following financial information is a summary of the operating income of each operational segment: Year ended December 31, 2019 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 20,552 $ 34,183 $ 38,687 $ 8,610 $ - $ 102,032 Intersegment revenues 6,037 250 - - (6,287 ) - Total revenues 26,589 34,433 38,687 8,610 (6,287 ) 102,032 Cost of revenues 23,998 27,852 33,337 7,751 (6,468 ) 86,470 Gross profit 2,591 6,581 5,350 859 181 15,562 Research and development 58 83 7 (74 ) - 74 Selling and marketing 1,530 1,638 1,334 757 - 5,259 General and administrative 1,978 2,734 2,408 1,131 - 8,251 Operating income (loss) $ (975 ) $ 2,126 $ 1,601 $ (955 ) $ 181 $ 1,978 Financial expenses, net 451 Income before taxes on income 1,527 Year ended December 31, 2018 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 20,065 $ 30,929 $ 32,487 $ 9,697 $ - $ 93,178 Intersegment revenues 4,642 415 - - (5,057 ) - Total revenues 24,707 31,344 32,487 9,697 (5,057 ) 93,178 Cost of revenues 25,612 27,659 28,561 8,298 (5,343 ) 84,787 Gross profit (loss) (905 ) 3,685 3,926 1,399 286 8,391 Research and development 287 98 - 168 - 553 Selling and marketing 1,512 1,660 1,324 417 - 4,913 General and administrative 2,384 2,375 2,631 1,169 - 8,559 Other income (2 ) - (2 ) - - (4 ) Operating income (loss) $ (5,086 ) $ (448 ) $ (27 ) $ (355 ) $ 286 $ (5,630 ) Financial expenses, net 102 Loss before taxes on income (5,732 ) Year ended December 31, 2017 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Elimination of inter-company sales Consolidated Revenues Sale of products and services $ 27,898 $ 34,615 $ 33,009 $ 11,005 $ - $ 106,527 Intersegment revenues 3,339 197 - - (3,536 ) - Total revenues 31,237 34,812 33,009 11,005 (3,536 ) 106,527 Cost of revenues 25,535 26,085 29,026 9,057 (3,620 ) 86,083 Gross profit 5,702 8,727 3,983 1,948 84 20,444 Research and development 398 169 - 164 - 731 Selling and marketing 1,968 1,358 1,213 435 - 4,974 General and administrative 2,072 3,182 3,049 1,106 - 9,409 Other expenses - - 53 - - 53 Operating income (loss) $ 1,264 $ 4,018 $ (332 ) $ 243 $ 84 $ 5,277 Financial expenses, net 338 Income before taxes on income 4,939 |
Schedule of Assets, Depreciation and Amortization, and Capital Expenditures by Segment | The following financial information identifies the assets, depreciation and amortization, and capital expenditures to segments: Year ended December 31, 2019 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 29,149 31,031 34,264 10,194 10,037 114,675 Depreciation and amortization 1,601 1,031 786 954 - 4,372 Expenditure for segment assets 1,600 1,180 803 239 - 3,822 Year ended December 31, 2018 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 26,171 33,794 27,687 11,100 4,535 103,287 Depreciation and amortization 1,476 1,044 705 960 - 4,185 Expenditure for segment assets 2,665 588 764 144 - 4,161 Year ended December 31, 2017 OEM of Heat Transfer Solutions and Aviation Accessories MRO Services for heat transfer components and OEM of heat transfer solutions MRO services for Aviation Components Overhaul and coating of jet engine components Amounts not allocated to segments Consolidated Total assets 29,411 35,067 27,276 11,915 8,326 111,995 Depreciation and amortization 1,299 1,029 653 960 - 3,941 Expenditure for segment assets 1,769 866 847 402 - 3,884 |
ENTITY-WIDE DISCLOSURE (Tables)
ENTITY-WIDE DISCLOSURE (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segments, Geographical Areas [Abstract] | |
Schedule of total revenues by geographical location | Total revenues - by geographical location were attributed according to customer residential country as follows: Year ended December 31, 2019 2018 2017 Total revenues Total revenues Total revenues Sale of products Israel $ 3,464 $ 2,893 $ 6,289 United States 14,181 13,013 19,004 Other 7,374 7,245 10,760 $ 25,019 $ 23,151 $ 36,053 Year ended December 31, 2019 2018 2017 Total revenues Total revenues Total revenues Sale of Services Israel $ 3,624 $ 4,031 $ 3,704 United States 47,749 41,019 40,047 Other 25,640 24,977 26,723 $ 77,013 $ 70,027 $ 70,474 |
Schedule of long-lived assets by geographical location | Total long-lived assets - by geographical location were as follows: December 31, 2019 2018 Israel $ 16,318 $ 12,894 United States 11,354 8,530 Total $ 27,672 $ 21,424 |
SUPPLEMENTAL CONSOLIDATED BAL_2
SUPPLEMENTAL CONSOLIDATED BALANCE SHEETS INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule of Supplemental Consolidated Balance Sheets Information | Warranty provision Provision for doubtful Accounts Balance, as of December 31, 2016 338 302 Additions 154 361 Deductions (186 ) (40 ) Balance, as of December 31, 2017 306 623 Additions 214 135 Deductions (235 ) (482 ) Balance, as of December 31, 2018 $ 285 $ 276 Additions 115 84 Deductions (165 ) (46 ) Balance, as of December 31, 2019 $ 235 $ 314 |
GENERAL (Details)
GENERAL (Details) | Dec. 31, 2019 | Nov. 25, 2015 |
TAT-Engineering Parent [Member] | ||
Subsidiary or Equity Method Investee [Line Items] | ||
Ownership percentage | 51.00% | 49.00% |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2019USD ($) | Dec. 31, 2017 | Dec. 31, 2019₪ / shares | Dec. 31, 2018USD ($) | Dec. 31, 2018₪ / shares | |
Inventories | |||||
Short term bank deposit average interest rate | 0.006 | ||||
Earnings Per Share, Basic and Diluted [Abstract] | |||||
Ordinary shares, par value per share | ₪ / shares | ₪ 0.9 | ₪ 0.9 | |||
Lease assets | $ | $ 6,664 | ||||
United States [Member] | |||||
Earnings Per Share, Basic and Diluted [Abstract] | |||||
Weighted-average interest rate to discount future lease payments | 4.84% | ||||
Israel [Member] | |||||
Earnings Per Share, Basic and Diluted [Abstract] | |||||
Weighted-average interest rate to discount future lease payments | 4.50% | ||||
Buildings and leasehold improvements [Member] | Minimum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 7 years | ||||
Buildings and leasehold improvements [Member] | Maximum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 39 years | ||||
Machinery and Equipment [Member] | Minimum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 3 years | ||||
Machinery and Equipment [Member] | Maximum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 17 years | ||||
Motor Vehicles [Member] | Minimum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 6 years | ||||
Motor Vehicles [Member] | Maximum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 7 years | ||||
Office Furniture and Equipment [Member] | Minimum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 3 years | ||||
Office Furniture and Equipment [Member] | Maximum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 17 years | ||||
Software [Member] | Minimum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 3 years | ||||
Software [Member] | Maximum [Member] | |||||
Property, plant and equipment | |||||
Estimated useful lives, years | 5 years |
FAIR VALUE MEASUREMENT (Narrati
FAIR VALUE MEASUREMENT (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Disclosures [Abstract] | ||
Notional amount of open forward contracts | $ 1,017 | $ 10,332 |
Notional amount of open call options | 3,781 | |
Notional amount of open put options | $ 3,957 |
FAIR VALUE MEASUREMENT (Schedul
FAIR VALUE MEASUREMENT (Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets: | ||
Derivative financial instruments | $ 27 | $ 210 |
Level 1 [Member] | ||
Assets: | ||
Derivative financial instruments | ||
Level 2 [Member] | ||
Assets: | ||
Derivative financial instruments | 27 | 210 |
Level 3 [Member] | ||
Assets: | ||
Derivative financial instruments |
INVENTORY (Narrative) (Details)
INVENTORY (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |||
Total amount of Rotables | $ 8,886 | $ 8,284 | |
Slow moving inventory write-down | $ 147 | $ 691 | $ 964 |
INVENTORY (Schedule of Inventor
INVENTORY (Schedule of Inventory, Net) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Inventory Disclosure [Abstract] | |||
Raw materials and components | $ 13,296 | $ 10,758 | |
Work in progress | 11,735 | 7,297 | |
Spare parts | 18,272 | 19,557 | |
Finished goods | 604 | 993 | |
Total inventory | [1] | $ 43,907 | $ 38,605 |
[1] | The total amount of Rotables included in the company spare parts inventory for the years ended December 31, 2019 and 2018 were $8,886 and $8,284, respectively. |
INVESTMENT IN AFFILIATES (Narra
INVESTMENT IN AFFILIATES (Narrative) (Details) | Dec. 31, 2019 |
TAT [Member] | |
Investments in and Advances to Affiliates [Line Items] | |
Percentage of Ownerhsip held | 51.00% |
Engineering [Member] | |
Investments in and Advances to Affiliates [Line Items] | |
Percentage of Ownerhsip held | 49.00% |
INVESTMENT IN AFFILIATES (Summa
INVESTMENT IN AFFILIATES (Summary of Financial Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Balance sheets: | |||
Current assets | $ 83,638 | $ 77,459 | |
Non-current assets | 27,672 | 21,424 | |
Current liabilities | 20,704 | 14,681 | |
Non-current liabilities | 8,601 | 4,312 | |
Statements of operation: | |||
Revenues | 102,032 | 93,178 | $ 106,527 |
Gross loss | 15,562 | 8,391 | 20,444 |
Loss from continuing operations | 806 | (4,408) | 2,396 |
TAT-Engineering LLC [Member] | |||
Balance sheets: | |||
Current assets | 466 | 919 | |
Non-current assets | 1,383 | 1,436 | |
Current liabilities | 1,040 | 1,254 | |
Non-current liabilities | |||
Statements of operation: | |||
Revenues | 877 | 1,534 | 604 |
Gross loss | (228) | (154) | (216) |
Loss from continuing operations | (291) | (266) | (416) |
Net losses attributable to the Company | $ (132) | $ (140) | $ (210) |
PROPERTY, PLANT AND EQUIPMENT_3
PROPERTY, PLANT AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | $ 71,376 | $ 67,554 | |
Less: Accumulated depreciation | 50,368 | 46,130 | |
Depreciated cost | 21,008 | 21,424 | |
Depreciation expenses | 4,238 | 4,051 | $ 3,807 |
Land and Buildings [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | 14,863 | 13,077 | |
Machinery and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | 52,872 | 51,017 | |
Motor Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | 410 | 410 | |
Office Furniture and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | 1,811 | 1,802 | |
Software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment, gross | $ 1,420 | $ 1,248 |
LEASES (Narrative) (Details)
LEASES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Vehicles [Member] | |||
Monthly rent payments owed on leased properties | $ 40 | ||
Lessee Leasing Arrangements, Operating Leases, Term of Contract | 3 years | ||
Limco Piedmont Inc [Member] | |||
Monthly rent payments owed on leased properties | $ 4,100 | ||
Lease expense | $ 510 | $ 494 | $ 474 |
Lease expiration date | Mar. 31, 2030 | ||
TAT Industries [Member] | |||
Lease expense | $ 787 | $ 767 | $ 740 |
Lease expiration date | Dec. 31, 2024 |
LEASES (Schedule of Lease Cost)
LEASES (Schedule of Lease Cost) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lessee Disclosure [Abstract] | |
Operating lease expenses | $ 1,297 |
LEASES (Schedule of Supplementa
LEASES (Schedule of Supplemental Cash Flow Information Related to Leases) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Lessee Disclosure [Abstract] | |
Operating cash flows from operating leases | $ 354 |
LEASES (Schedule of Operating C
LEASES (Schedule of Operating Cash Flows) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Operating Leases | ||
Operating lease right-of-use assets | $ 6,664 | |
Current operating lease liabilities | 1,330 | |
Non-current operating lease liabilities | 5,688 | |
Total operating lease liabilities | $ 7,018 | |
Israel [Member] | ||
Operating Leases | ||
Weighted Average Remaining Lease Term | 5 years | |
Weighted Average discount percentage | 4.50% | |
United States [Member] | ||
Operating Leases | ||
Weighted Average Remaining Lease Term | 6 years | |
Weighted Average discount percentage | 4.84% |
LEASES (Schedule of Maturities
LEASES (Schedule of Maturities of Lease Liabilities) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Lessee Disclosure [Abstract] | |
2020 | $ 1,626 |
2021 | 1,461 |
2022 | 1,314 |
2023 | 1,250 |
2024 and after | 1,827 |
Total lease payments | 7,478 |
Less imputed interest | (460) |
Total | $ 7,018 |
LEASES (Schedule of Minimum Lea
LEASES (Schedule of Minimum Lease Payments) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Lessee Disclosure [Abstract] | |
2019 | $ 1,551 |
2020 | 1,488 |
2021 | 1,330 |
2022 | 1,224 |
2023 and after | 2,719 |
Total | $ 8,312 |
INTANGIBLE ASSETS (Schedule of
INTANGIBLE ASSETS (Schedule of Intangible Assets) (Details) - Customer relationships [Member] - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 1,342 | $ 1,342 |
Accumulated amortization | (565) | (431) |
Amortized cost | $ 777 | $ 911 |
ACCRUED EXPENSES (Schedule of O
ACCRUED EXPENSES (Schedule of Other Account Payable and Accrued Expenses) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Other account payable and accrued expenses: | ||
Employees and payroll accruals | $ 3,332 | $ 2,869 |
Accrued expenses | 937 | 840 |
Authorities | 810 | 677 |
Advances from customers | 513 | 483 |
Warranty provision | 235 | 285 |
Accrued royalties and rebate sales commissions | 1,517 | 966 |
Other | 49 | 291 |
Total other account payable and accrued expenses | $ 7,393 | $ 6,411 |
RELATED PARTIES_ TRANSACTIONS A
RELATED PARTIES’ TRANSACTIONS AND BALANCES (Schedule of Transactions and Balances with Related Parties) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Transactions: | ||||
Income - Sales to related-party company | [1] | $ 596 | $ 1,251 | $ 959 |
Cost and expenses - Supplies from related party | [1] | 552 | 59 | $ 6 |
Balances: | ||||
Trade receivables and other receivables | [1] | 706 | 699 | |
Trade payables and other payables | [1] | $ 154 | ||
[1] | includes mainly transactions with affiliated companies. |
LONG-TERM EMPLOYEE-RELATED OB_3
LONG-TERM EMPLOYEE-RELATED OBLIGATIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Severance payments actually paid | $ 689 | $ 400 | $ 96 |
Expected deposits to be made in the next fiscal year for severance and pension payment obligations | 1,208 | ||
2020 | 341 | ||
2021 | 55 | ||
2022 | 9 | ||
2023 | 147 | ||
2024 | 48 | ||
Thereafter (through 2029) | 426 | ||
Total | 1,026 | ||
TAT and Turbochrome [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Severance pay expenses | 1,096 | 968 | 910 |
Limco Piedmont Inc [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
401(K) profit sharing plan contributions made by company | $ 406 | $ 385 | $ 350 |
Percentage of employees contribution matched by employer | 100.00% | ||
Percentage of employees contribution | 2.00% | ||
Percentage of employees contribution matched by employer, two | 50.00% | ||
Percentage of employees contribution, two | 3.00% |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Commissions and Royalty Commitments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Commissions arrangements: | |||
Commission expenses | $ 679 | $ 411 | $ 664 |
Royalty commitments: | |||
Royalty expense | 42 | 148 | 25 |
Limco Piedmont Inc [Member] | |||
Royalty commitments: | |||
Royalty expense | $ 2,310 | $ 1,689 | $ 1,885 |
Limco Piedmont Inc [Member] | Minimum [Member] | |||
Royalty commitments: | |||
Royalties percentage rate for sales of products developed by third parties | 5.00% | ||
Royalties percentage rate for sales of additional products developed by third parties | 20.00% | ||
Limco Piedmont Inc [Member] | Maximum [Member] | |||
Royalty commitments: | |||
Royalties percentage rate for sales of products developed by third parties | 13.00% | ||
TAT Technologies Ltd [Member] | Minimum [Member] | |||
Commissions arrangements: | |||
Percentage rate paid to sales agents for marketing commissions | 1.00% | ||
Royalty commitments: | |||
Royalties percentage rate for sales of products developed by third parties | 12.00% | ||
TAT Technologies Ltd [Member] | Maximum [Member] | |||
Commissions arrangements: | |||
Percentage rate paid to sales agents for marketing commissions | 10.00% | ||
Royalty commitments: | |||
Royalties percentage rate for sales of products developed by third parties | 17.00% |
COMMITMENTS AND CONTINGENT LI_3
COMMITMENTS AND CONTINGENT LIABILITIES (Guarantees) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
TAT Technologies Ltd [Member] | |
Guarantees: | |
Bank guarantee to secure liability to Israeli customs | $ 58 |
Additional bank guarantee to secure liability to Israeli customs | 36 |
Limco Piedmont Inc [Member] | |
Guarantees: | |
Bank guarantee to secure liability to lessor | $ 790 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) ₪ / shares in Units, $ / shares in Units, ₪ in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |
May 17, 2017USD ($)$ / shares | Dec. 31, 2018USD ($) | May 17, 2017ILS (₪)₪ / shares | |
Shareholder Equity [Line Items] | |||
Cash dividend declared, amount | $ 3,000 | ||
Cash dividend declared, value per share | $ / shares | $ 0.34 | ||
Cash dividend declared, declaration date | May 17, 2017 | ||
Cash dividend declared, record date | Jun. 7, 2017 | ||
Cash dividend declared, payment date | Jun. 21, 2017 | ||
Incremental cost | $ 74 | ||
ILS [Member] | |||
Shareholder Equity [Line Items] | |||
Cash dividend declared, amount | ₪ | ₪ 10,800 | ||
Cash dividend declared, value per share | ₪ / shares | ₪ 1.2 |
SHAREHOLDERS' EQUITY (Stock Opt
SHAREHOLDERS' EQUITY (Stock Option Plans TAT Technology) (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||||||||
Jun. 30, 2012 | Jun. 28, 2012₪ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2019₪ / shares | Sep. 26, 2019$ / sharesshares | Sep. 22, 2019$ / sharesshares | Aug. 29, 2019$ / sharesshares | Dec. 31, 2018₪ / shares | Nov. 22, 2018$ / sharesshares | May 13, 2018$ / sharesshares | Feb. 28, 2018$ / sharesshares | Feb. 06, 2018$ / sharesshares | Oct. 30, 2017$ / sharesshares | Aug. 10, 2017$ / sharesshares | Mar. 06, 2017$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Ordinary shares, par value per share | ₪ / shares | ₪ 0.9 | ₪ 0.9 | |||||||||||||||
Number of options | |||||||||||||||||
Options, beginning | 548,267 | 365,000 | 330,000 | ||||||||||||||
Options, Granted | 170,000 | 273,893 | 75,000 | ||||||||||||||
Options, Forfeited | (126,808) | (63,958) | (20,417) | ||||||||||||||
Options, Exercised | (26,668) | (19,583) | |||||||||||||||
Options, ending | 591,459 | 548,267 | 365,000 | ||||||||||||||
Exercisable at end of year | 264,389 | 163,438 | 120,417 | ||||||||||||||
Weighted average exercise price | |||||||||||||||||
Options, beginning | $ / shares | $ 9.03 | $ 8.53 | $ 7.97 | ||||||||||||||
Options, Granted | $ / shares | 5.44 | 9.70 | 10.39 | ||||||||||||||
Options, Forfeited | $ / shares | 11.19 | 9.85 | 7.47 | ||||||||||||||
Options, Exercised | $ / shares | 7.15 | 7.3 | |||||||||||||||
Options, ending | $ / shares | 7.53 | 9.03 | 8.53 | ||||||||||||||
Exercisable at end of year | $ / shares | 7.74 | 8.34 | 7.95 | ||||||||||||||
Weighted-average grant-date fair value of options granted | $ / shares | $ 1.35 | $ 1.83 | $ 1.74 | ||||||||||||||
2012 Plan [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Number of shares authorized for the plan | 380,000 | 50,000 | 50,000 | 70,000 | 70,000 | 70,000 | 50,000 | 3,893 | 80,000 | 45,000 | 30,000 | ||||||
Vesting period for plan | 3 years | 4 years | |||||||||||||||
Ordinary shares, par value per share | ₪ / shares | ₪ 0.9 | ||||||||||||||||
Exercise price | $ / shares | $ 5.26 | $ 5.32 | $ 5.65 | $ 7.35 | $ 9.12 | $ 10.74 | $ 11.11 | $ 11.54 | $ 11.39 | $ 8.9 | |||||||
Dividend yield | 0.00% | 5.00% | |||||||||||||||
Weighted average exercise price | |||||||||||||||||
Aggregate intrinsic value | $ | $ 0 | $ 737 | $ 332 | ||||||||||||||
Unrecognized compensation cost related to non-vested stock options | $ | $ 230 | ||||||||||||||||
Unrecognized compensation weighted average period of recognition, years | 1 year 29 days | ||||||||||||||||
Period in which equity exceeds threshold | 4 years | ||||||||||||||||
2012 Plan [Member] | Minimum [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Number of shares authorized for the plan | 300,000 | 300,000 | |||||||||||||||
Expected stock price volatility | 34.20% | 32.60% | 33.30% | ||||||||||||||
Expected option life (in years) | 3 years 6 months | 3 years 6 months | 4 years | ||||||||||||||
Risk free interest rate | 1.44% | 1.71% | 1.49% | ||||||||||||||
Dividend yield | 0.00% | ||||||||||||||||
2012 Plan [Member] | Maximum [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Number of shares authorized for the plan | 680,000 | 980,000 | |||||||||||||||
Expected stock price volatility | 36.80% | 40.80% | 40.50% | ||||||||||||||
Expected option life (in years) | 5 years | 5 years 6 months | 5 years 6 months | ||||||||||||||
Risk free interest rate | 1.63% | 2.87% | 1.81% | ||||||||||||||
Dividend yield | 5.00% | ||||||||||||||||
2012 Plan [Member] | Vest upon the lapse of 12 months [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Vesting percentage | 25.00% | ||||||||||||||||
2012 Plan [Member] | Vest on a quarterly basis [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||||||
Vesting period for plan | 3 years | ||||||||||||||||
Vesting percentage | 75.00% |
EARNINGS PER SHARE (EPS) (Detai
EARNINGS PER SHARE (EPS) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator for EPS: | |||
Net income (loss) | $ 806 | $ (4,408) | $ 2,396 |
Denominator for EPS: | |||
Weighted average shares outstanding - basic | 8,874,696 | 8,864,885 | 8,848,028 |
Dilutive shares | 61,044 | ||
Weighted average shares outstanding - diluted | 8,874,696 | 8,864,885 | 8,909,072 |
EPS | |||
Basic and diluted | $ 0.1 | $ (0.5) | $ 0.27 |
Anti-dilutive options excluded from calculation of diluted income (loss) per share | 482,282 | 306,151 | 105,000 |
TAXES ON INCOME (Narrative) (De
TAXES ON INCOME (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2017 | Jan. 31, 2017 | Aug. 31, 2013 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Taxes [Line Items] | ||||||||||||
Preferred Income tax rate not within Development Zone A | 12.00% | 16.00% | 12.50% | 15.00% | 15.00% | |||||||
Preferred Income tax rate for Development Zone A | 6.00% | 9.00% | 7.00% | 10.00% | 10.00% | |||||||
Maximum tax rate on dividends distributed from Preferred Income. | 20.00% | 15.00% | ||||||||||
Corporate tax rate for Israel | 23.00% | 23.00% | 24.00% | |||||||||
U.S. subsidiaries tax rate, federal and state | 38.00% | |||||||||||
Reduction of corporate tax rate | 25.00% | |||||||||||
Uniform tax rate for Development Zone A | 7.50% | |||||||||||
Deferred tax asset, state operating loss carryforward | $ 3,500 | $ 3,375 | ||||||||||
United States [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Corporate tax rate for Israel | 21.00% | |||||||||||
United States [Member] | Minimum [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Corporate tax rate for Israel | 3.00% | |||||||||||
United States [Member] | Maximum [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Corporate tax rate for Israel | 6.00% | |||||||||||
U.S. Subsidiary [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Deferred tax asset, state operating loss carryforward | $ 1,519 | |||||||||||
TAT Technologies Ltd [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Preferred Income tax rate not within Development Zone A | 16.00% | 12.50% | 15.00% | 15.00% | ||||||||
Deferred tax asset, capital loss carryforward | $ 1,502 | |||||||||||
Turbo chrome [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Preferred Income tax rate for Development Zone A | 7.50% | 9.00% | 9.00% | 9.00% | 7.00% | 10.00% | 10.00% | |||||
Tax Year 2017 [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Reduction of corporate tax rate | 24.00% | |||||||||||
Tax Year 2018 [Member] | ||||||||||||
Income Taxes [Line Items] | ||||||||||||
Reduction of corporate tax rate | 23.00% |
TAXES ON INCOME (Schedule of Re
TAXES ON INCOME (Schedule of Reconciliation of Tax Provisions to the Domestic and Effective Tax Rate) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income Tax Disclosure [Abstract] | ||||
Income (loss) before taxes on income (tax benefit) as reported in the statements of income | $ 1,527 | $ (5,732) | $ 4,939 | |
Statutory tax rate in Israel | 23.00% | 23.00% | 24.00% | |
Theoretical taxes on income (tax benefit) | $ 351 | $ (1,318) | $ 1,185 | |
Increase (decrease) in taxes on income resulting from: | ||||
Tax adjustment for foreign subsidiaries subject to a different tax rate | (26) | (9) | 518 | |
Reduced tax rate on income derived from "Preferred Enterprises" plans | 305 | 421 | (111) | |
Earnings from foreign subsidiaries | [1] | 91 | (338) | 371 |
Valuation allowance for exchange rates differences on deferred taxes not recorded on capital losses | (125) | (42) | 8 | |
Change in tax rate | 414 | |||
Tax in respect of prior years | (481) | 7 | ||
Temporary differences for which no deferred taxes were recorded | (55) | 8 | ||
Permanent differences | 55 | 245 | (104) | |
Other adjustments | (7) | 50 | 45 | |
Taxes on income as reported in the statements of income | $ 589 | $ (1,464) | $ 2,333 | |
[1] | During 2019, 2018 and 2017, the Company recorded an accrual that related to a tax liability due to actual distribution of earnings from foreign subsidiaries of the Company and due to the possibility of future distribution of earnings from such foreign subsidiaries. |
TAXES ON INCOME (Schedule of In
TAXES ON INCOME (Schedule of Income (Loss) from Continuing Operations Before Income Tax Domestic and Foreign) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Domestic (Israel) | $ (2,586) | $ (5,261) | $ 1,337 |
Foreign (United States) | 4,113 | (471) | 3,602 |
Income before taxes on income | $ 1,527 | $ (5,732) | $ 4,939 |
TAXES ON INCOME (Schedule of Co
TAXES ON INCOME (Schedule of Components of Income Tax Provision) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Domestic (Israel) | $ 431 | ||
Foreign (United States) | 139 | (881) | 1,937 |
Total current | 139 | (881) | 2,368 |
Deferred: | |||
Domestic (Israel) | (355) | (813) | 210 |
Foreign (United States) | 805 | 711 | (252) |
Total deferred | 450 | (102) | (42) |
Previous Years: | |||
Foreign (United States) | (481) | 7 | |
Total previous years | (481) | 7 | |
Taxes on income as reported in the statements of income | $ 589 | $ (1,464) | $ 2,333 |
TAXES ON INCOME (Schedule of De
TAXES ON INCOME (Schedule of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets: | |||||
Provision for doubtful accounts | $ 67 | $ 59 | |||
Provisions for employee benefits | 470 | 267 | |||
Inventory | 964 | 975 | |||
Intangible assets | 42 | 100 | |||
Capital tax losses carryforward | 3,500 | 3,375 | |||
Net operating losses carryforward | 1,669 | 1,102 | |||
Other | 96 | 288 | |||
Deferred tax assets, before valuation allowance | 6,808 | 6,166 | |||
Valuation allowance | (3,500) | (3,375) | $ (3,417) | $ (3,409) | |
Deferred tax assets, net | 3,308 | 2,791 | |||
Deferred tax liabilities: | |||||
Property, plant and equipment and intangible assets | (2,159) | (2,085) | |||
Earnings from foreign subsidiaries | [1] | (1,953) | (1,862) | ||
Other temporary differences deferred tax liabilities | (68) | (166) | |||
Deferred tax liabilities | (4,180) | (4,113) | |||
Net | $ (872) | $ (1,322) | |||
[1] | The Company record an accrual that related to a deferred tax liability due to the possibility of future distribution of earnings from foreign subsidiaries of the Company. |
TAXES ON INCOME (Schedule of Ch
TAXES ON INCOME (Schedule of Changes in Valuation Allowance) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Changes in Valuation Allowance | |||
Balance | $ 3,375 | $ 3,417 | $ 3,409 |
Additions during the year | 125 | (42) | 8 |
Balance | 3,500 | $ 3,375 | $ 3,417 |
Investments In Foreign Subsidiaries And Foreign Corporate Joint Ventures That Are Permanent In Nature [Member] | |||
Changes in Valuation Allowance | |||
Undistributed earnings of foreign subsidiaries | 1,936 | ||
The amount of deferred tax liability that would be recorded if foreign earnings were distributed by cash dividend | $ 445 | ||
Tax rate on recognized foreign earnings dividends | 23.00% |
SEGMENT INFORMATION (Schedule o
SEGMENT INFORMATION (Schedule of Operating Income By Segment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | $ 102,032 | $ 93,178 | $ 106,527 |
Cost of revenues | 86,470 | 84,787 | 86,083 |
Gross profit | 15,562 | 8,391 | 20,444 |
Research and development | 74 | 553 | 731 |
Selling and marketing | 5,259 | 4,913 | 4,974 |
General and administrative | 8,251 | 8,559 | 9,409 |
Other expenses (income) | (4) | 53 | |
Operating income (loss) | 1,978 | (5,630) | 5,277 |
Financial expense, net | 451 | 102 | 338 |
Income before taxes on income | 1,527 | (5,732) | 4,939 |
Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 102,032 | 93,178 | 106,527 |
Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | |||
Elimination of inter-company sales [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | (6,287) | (5,057) | (3,536) |
Cost of revenues | (6,468) | (5,343) | (3,620) |
Gross profit | 181 | 286 | 84 |
Research and development | |||
Selling and marketing | |||
General and administrative | |||
Other expenses (income) | |||
Operating income (loss) | 181 | 286 | 84 |
Elimination of inter-company sales [Member] | Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | |||
Elimination of inter-company sales [Member] | Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | (6,287) | (5,057) | (3,536) |
OEM of Heat Transfer Solutions and Aviation Accessories [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 26,589 | 24,707 | 31,237 |
Cost of revenues | 23,998 | 25,612 | 25,535 |
Gross profit | 2,591 | (905) | 5,702 |
Research and development | 58 | 287 | 398 |
Selling and marketing | 1,530 | 1,512 | 1,968 |
General and administrative | 1,978 | 2,384 | 2,072 |
Other expenses (income) | (2) | ||
Operating income (loss) | (975) | (5,086) | 1,264 |
OEM of Heat Transfer Solutions and Aviation Accessories [Member] | Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 20,552 | 20,065 | 27,898 |
OEM of Heat Transfer Solutions and Aviation Accessories [Member] | Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 6,037 | 4,642 | 3,339 |
MRO Services for heat transfer components and OEM of heat transfer solutions [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 34,433 | 31,344 | 34,812 |
Cost of revenues | 27,852 | 27,659 | 26,085 |
Gross profit | 6,581 | 3,685 | 8,727 |
Research and development | 83 | 98 | 169 |
Selling and marketing | 1,638 | 1,660 | 1,358 |
General and administrative | 2,734 | 2,375 | 3,182 |
Other expenses (income) | |||
Operating income (loss) | 2,126 | (448) | 4,018 |
MRO Services for heat transfer components and OEM of heat transfer solutions [Member] | Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 34,183 | 30,929 | 34,615 |
MRO Services for heat transfer components and OEM of heat transfer solutions [Member] | Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 250 | 415 | 197 |
MRO services for Aviation Components [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 38,687 | 32,487 | 33,009 |
Cost of revenues | 33,337 | 28,561 | 29,026 |
Gross profit | 5,350 | 3,926 | 3,983 |
Research and development | 7 | ||
Selling and marketing | 1,334 | 1,324 | 1,213 |
General and administrative | 2,408 | 2,631 | 3,049 |
Other expenses (income) | (2) | 53 | |
Operating income (loss) | 1,601 | (27) | (332) |
MRO services for Aviation Components [Member] | Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 38,687 | 32,487 | 33,009 |
MRO services for Aviation Components [Member] | Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | |||
Overhaul and coating of jet engine components [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 8,610 | 9,697 | 11,005 |
Cost of revenues | 7,751 | 8,298 | 9,057 |
Gross profit | 859 | 1,399 | 1,948 |
Research and development | (74) | 168 | 164 |
Selling and marketing | 757 | 417 | 435 |
General and administrative | 1,131 | 1,169 | 1,106 |
Other expenses (income) | |||
Operating income (loss) | (955) | (355) | 243 |
Overhaul and coating of jet engine components [Member] | Sale of Products and Services [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues | 8,610 | 9,697 | 11,005 |
Overhaul and coating of jet engine components [Member] | Intersegment Revenues [Member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Revenues |
SEGMENT INFORMATION (Schedule_2
SEGMENT INFORMATION (Schedule of Assets, Depreciation and Amortization, and Capital Expenditures by Segment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 114,675 | $ 103,287 | $ 111,995 |
Depreciation and amortization | 4,372 | 4,185 | 3,941 |
Expenditure for segment assets | 3,822 | 4,161 | 3,884 |
OEM of Heat Transfer Solutions and Aviation Accessories [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 29,149 | 26,171 | 29,411 |
Depreciation and amortization | 1,601 | 1,476 | 1,299 |
Expenditure for segment assets | 1,600 | 2,665 | 1,769 |
MRO Services for heat transfer components and OEM of heat transfer solutions [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 31,031 | 33,794 | 35,067 |
Depreciation and amortization | 1,031 | 1,044 | 1,029 |
Expenditure for segment assets | 1,180 | 588 | 866 |
MRO services for Aviation Components [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 34,264 | 27,687 | 27,276 |
Depreciation and amortization | 786 | 705 | 653 |
Expenditure for segment assets | 803 | 764 | 847 |
Overhaul and coating of jet engine components [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 10,194 | 11,100 | 11,915 |
Depreciation and amortization | 954 | 960 | 960 |
Expenditure for segment assets | 239 | 144 | 402 |
Amounts not allocated to segments [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 10,037 | 4,535 | 8,326 |
Depreciation and amortization | |||
Expenditure for segment assets |
ENTITY-WIDE DISCLOSURE (Schedul
ENTITY-WIDE DISCLOSURE (Schedule of Total Revenues by Geographical Location) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | $ 102,032 | $ 93,178 | $ 106,527 |
Product [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 25,019 | 23,151 | 36,053 |
Service [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 77,013 | 70,027 | 70,474 |
Israel [Member] | Product [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 3,464 | 2,893 | 6,289 |
Israel [Member] | Service [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 3,624 | 4,031 | 3,704 |
United States [Member] | Product [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 14,181 | 13,013 | 19,004 |
United States [Member] | Service [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 47,749 | 41,019 | 40,047 |
Other [Member] | Product [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | 7,374 | 7,245 | 10,760 |
Other [Member] | Service [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total revenues | $ 25,640 | $ 24,977 | $ 26,723 |
ENTITY-WIDE DISCLOSURE (Sched_2
ENTITY-WIDE DISCLOSURE (Schedule of Long-Lived Assets by Geographical Location) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | $ 27,672 | $ 21,424 |
Israel [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | 16,318 | 12,894 |
United States [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-Lived Assets | $ 11,354 | $ 8,530 |
SUPPLEMENTAL CONSOLIDATED BAL_3
SUPPLEMENTAL CONSOLIDATED BALANCE SHEETS INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Warranty provision [Member] | |||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance, beginning | $ 285 | $ 306 | $ 338 |
Additions | 115 | 214 | 154 |
Deductions | (165) | (235) | (186) |
Balance, ending | 235 | 285 | 306 |
Provision for doubtful Accounts [Member] | |||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance, beginning | 276 | 623 | 302 |
Additions | 84 | 135 | 361 |
Deductions | (46) | (482) | (40) |
Balance, ending | $ 314 | $ 276 | $ 623 |