Document_and_Entity_Informatio
Document and Entity Information (USD $) | 3 Months Ended | |
Sep. 28, 2013 | Oct. 25, 2013 | |
Document And Entity Information | ' | ' |
Entity Registrant Name | 'CPS Technologies Corp/DE/ | ' |
Entity Central Index Key | '0000814676 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 28-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-28 | ' |
Is Entity a Well-known Seasoned Issuer? | 'No | ' |
Is Entity a Voluntary Filer? | 'No | ' |
Is Entity's Reporting Status Current? | 'Yes | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Entity Public Float | ' | $16,000,000 |
Entity Common Stock, Shares Outstanding | ' | 13,061,974 |
Document Fiscal Period Focus | 'Q3 | ' |
Document Fiscal Year Focus | '2013 | ' |
Balance_Sheets_Unaudited
Balance Sheets (Unaudited) (USD $) | 3 Months Ended | |
Sep. 28, 2013 | Dec. 29, 2012 | |
Current assets: | ' | ' |
Cash and cash equivalents | $595,753 | $306,854 |
Accounts receivable-trade, net | 4,223,095 | 2,876,149 |
Inventories, net | 2,048,860 | 2,457,315 |
Prepaid expenses and other current assets | 173,368 | 140,723 |
Deferred taxes | 160,378 | 354,825 |
Total current assets | 7,201,454 | 6,135,866 |
Property and equipment: | ' | ' |
Production equipment | 7,550,480 | 7,430,783 |
Furniture and office equipment | 362,740 | 354,490 |
Leasehold improvements | 735,099 | 735,099 |
Total cost | 8,648,319 | 8,520,372 |
Accumulated depreciation and amortization | -7,328,946 | -6,877,285 |
Construction in progress | 527,332 | 138,133 |
Net property and equipment | 1,846,705 | 1,781,220 |
Deferred taxes, non-current portion | 2,432,148 | 2,432,148 |
Total assets | 11,480,307 | 10,349,234 |
Current liabilities: | ' | ' |
Line of credit | ' | 500,000 |
Equipment lease line of credit | 163,155 | ' |
Accounts payable | 1,537,597 | 1,179,313 |
Accrued expenses | 1,160,693 | 938,043 |
Current portion of obligations under capital leases | 82,555 | 123,366 |
Total current liabilities | 2,944,000 | 2,740,722 |
Obligations under capital leases, net of current portion | 14,117 | 76,372 |
Total liabilities | 2,958,117 | 2,817,094 |
Commitments (note 9) | ' | ' |
(9) Commitments | ||
In July 2006, the Company entered into a lease for its current operating facilities of approximately 37,520 square feet of rentable space located on approximately seven acres at its current site in Norton, MA. The term of the lease is ten years. The lease is a triple net lease wherein the Company is responsible for payment of all real estate taxes, operating costs and utilities. The Company also has an option to buy the property and a first right of refusal during the term of the lease. Annual rental payments are $100 thousand in year one increasing to $150 thousand in year ten. | ||
In February 2011, the Company entered into a one-year lease, with five options to renew for one year periods, for approximately 13,800 square feet of rentable space inside a larger building located at 79 Walton Street, Attleboro, Massachusetts. Monthly rent, which includes utilities, is $7 thousand. In October 2013, the Company renewed the lease through February, 2015. | ||
Stockholders equity: | ' | ' |
Common stock, $0.01 par value, authorized 15,000,000 shares; issued 13,165,042 and 12,928,042 shares; outstanding 13,061,974 and 12,871,859 shares; at September 28, 2013 and December 29, 2012, respectively | 131,650 | 129,281 |
Additional paid-in capital | 34,192,484 | 33,821,961 |
Accumulated deficit | -25,594,159 | -26,284,787 |
Less cost of 103,068 and 56,283 common shares repurchased at September 28, 2013 and December 29, 2012, respectively | -207,785 | -134,315 |
Total stockholders equity | 8,522,190 | 7,532,140 |
Total liabilities and stockholders equity | $11,480,307 | $10,349,234 |
Balance_Sheets_Parenthetical
Balance Sheets (Parenthetical) (USD $) | Sep. 28, 2013 | Dec. 29, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Common Stock, authorized shares | 15,000,000 | 15,000,000 |
Common Stock, issued shares | 13,165,042 | 12,928,042 |
Common Stock, outstanding shares | 13,061,974 | 12,871,859 |
Common Stock, par value | $0.01 | $0.01 |
Statements_of_Operations_Unaud
Statements of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 28, 2013 | Sep. 29, 2012 | Sep. 30, 2013 | Sep. 29, 2012 | |
Income Statement [Abstract] | ' | ' | ' | ' |
Product sales | $5,918,725 | $2,605,465 | $16,072,889 | $9,477,790 |
Research and development under cooperative agreement | 55,764 | 138,716 | 233,220 | 449,432 |
Total Revenues | 5,974,489 | 2,744,181 | 16,306,109 | 9,927,222 |
Cost of product sales | 4,209,683 | 2,862,384 | 12,116,150 | 9,620,401 |
Cost of research and development under cooperative agreement | 46,654 | 117,904 | 194,072 | 383,789 |
Gross Margin | 1,718,152 | -236,107 | 3,995,887 | -76,968 |
Selling, general and administrative expense | 1,059,033 | 641,046 | 2,967,066 | 2,294,778 |
Operating income (loss) | 659,119 | -877,153 | 1,028,821 | -2,371,746 |
Interest expense, net | -3,603 | -4,792 | -26,473 | -16,258 |
Net income (loss) before income tax expense (benefit) | 655,516 | -881,945 | 1,002,348 | -2,388,004 |
Income tax expense (benefit) | 204,000 | -351,000 | 311,720 | -950,000 |
Net income (loss) | $451,516 | ($530,945) | $690,628 | ($1,438,004) |
Net income (loss) per basic common share | $0.03 | ($0.04) | $0.05 | ($0.11) |
Weighted average number of basic common shares outstanding | 13,198,506 | 12,871,659 | 13,010,591 | 12,868,934 |
Net income (loss) per diluted common share | $0.03 | ($0.04) | $0.05 | ($0.11) |
Weighted average number of diluted common shares outstanding | 13,522,495 | 12,871,659 | 13,242,069 | 12,868,934 |
Statements_of_Cash_Flows
Statements of Cash Flows (USD $) | 9 Months Ended | |
Sep. 28, 2013 | Sep. 29, 2012 | |
Cash flows from operating activities: | ' | ' |
Net income (loss) | $690,628 | ($1,438,004) |
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities | ' | ' |
Depreciation & amortization | 451,663 | 556,653 |
Share-based compensation | 182,150 | 168,378 |
Provision for bad debts and sales returns | ' | 15,000 |
Write off of construction in process | ' | 12,720 |
Deferred taxes | 311,720 | -950,000 |
Excess tax benefit from stock options exercised | -117,273 | ' |
Accounts receivable-trade, net | -1,346,946 | 996,882 |
Inventories | 408,455 | -162,631 |
Prepaid expenses | -32,645 | -3,199 |
Accounts payable | 358,284 | -363,350 |
Accrued expenses | 222,650 | 215,908 |
Net cash provided by (used in) operating activities | 1,128,686 | -951,643 |
Cash flows from investing activities: | ' | ' |
Purchases of property and equipment | -517,148 | -205,677 |
Net cash used in investing activities | -517,148 | -205,677 |
Cash flows from financing activities: | ' | ' |
Payment of capital lease obligations | -103,066 | -173,123 |
Proceeds from equipment lease line | 163,155 | ' |
Proceeds (repayments) of line of credit, net | -500,000 | 400,000 |
Proceeds from issuance of common stock | 73,469 | 9,178 |
Excess tax benefit from stock options exercised | 117,273 | ' |
Repurchase of common stock | -73,470 | ' |
Net cash provided by (used in) financing activities | -322,639 | 236,055 |
Net increase (decrease) in cash and cash equivalents | 288,899 | -921,265 |
Cash and cash equivalents at beginning of period | 306,854 | 1,142,429 |
Cash and cash equivalents at end of period | 595,753 | 221,164 |
Supplemental cash flow information: | ' | ' |
Cash paid for taxes, net of refunds | ' | ' |
Interest paid | $26,473 | $16,258 |
Nature_of_business
Nature of business | 3 Months Ended |
Sep. 28, 2013 | |
Accounting Policies [Abstract] | ' |
Nature of business | ' |
(1) Nature of Business | |
CPS Technologies Corporation (the “Company” or “CPS”) provides advanced material solutions to the electronics, power generation, automotive and other industries. The Company’s primary advanced material solution is metal matrix composites which are a combination of metal and ceramic. | |
CPS also assembles housings and packages for hybrid circuits. These housings and packages may include components made of metal-matrix composites or they may include components made of more traditional materials such as aluminum and copper-tungsten. | |
In 2008 the Company also entered into a cooperative agreement with the U.S. Army to further develop its composite technology to produce armor. |
Interim_Financial_Statements
Interim Financial Statements | 3 Months Ended |
Sep. 28, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | ' |
Interim Financial Statements | ' |
(2) Interim Financial Statements | |
As permitted by the rules of the Securities and Exchange Commission applicable to quarterly reports on Form 10-Q, these notes are condensed and do not contain all disclosures required by generally accepted accounting principles. | |
The accompanying financial statements are unaudited. In the opinion of management, the unaudited financial statements of CPS reflect all normal recurring adjustments which are necessary to present fairly the financial position and results of operations for such periods. | |
The Company’s balance sheet at December 29, 2012 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. Certain items in the 2012 financial statements have been reclassified to conform with the 2013 presentation. | |
For further information, refer to the financial statements and footnotes thereto included CPS’s Annual Report on Form 10-K for the year ended December 29, 2012. | |
The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. | |
The Company’s second fiscal quarter end is the Saturday closest to June 30th, which could result in a 13 or 14 week fiscal quarter. The second quarters for fiscal 2012 and 2013 each consisted of 13 weeks. |
Net_Income_Loss_Per_Common_and
Net Income (Loss) Per Common and Common Equivalent Share | 3 Months Ended | ||||||||||||||||
Sep. 28, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Net Income (Loss) Per Common and Common Equivalent Share | ' | ||||||||||||||||
(3) Net Income (Loss) Per Common and Common Equivalent Share | |||||||||||||||||
Basic net income or loss per common share is calculated by dividing net income or loss by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is calculated by dividing net income by the sum of the weighted average number of common shares plus additional common shares that would have been outstanding if potential dilutive common shares had been issued for granted stock option and stock purchase rights. Common stock equivalents are excluded from the diluted calculations when a net loss is incurred as they would be anti-dilutive. | |||||||||||||||||
The following table presents the calculation of both basic and diluted EPS: | |||||||||||||||||
Three Months Ended | Nine-Months Ended | ||||||||||||||||
September 28, | September 29, | September 28, | September 29, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Basic EPS Computation: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net income (loss) | $ | 451,516 | $ | (530,945 | ) | $ | 690,628 | $ | (1,438,004 | ) | |||||||
Denominator: | |||||||||||||||||
Weighted average | |||||||||||||||||
Common shares | |||||||||||||||||
Outstanding | 13,198,506 | 12,871,659 | 13,010,591 | 12,868,934 | |||||||||||||
Basic EPS | $ | 0.03 | $ | (0.04 | ) | $ | 0.05 | $ | (0.11 | ) | |||||||
Diluted EPS Computation: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net income (loss) | $ | 451,516 | $ | (530,945 | ) | $ | 690,628 | $ | (1,438,004 | ) | |||||||
Denominator: | |||||||||||||||||
Weighted average | |||||||||||||||||
Common shares | |||||||||||||||||
Outstanding | 13,198,506 | 12,871,659 | 13,010,591 | 12,868,934 | |||||||||||||
Dilutive effect of stock options | 323,989 | — | 231,478 | — | |||||||||||||
Total Shares | 13,522,495 | 12,871,659 | 13,242,069 | 12,868,934 | |||||||||||||
Diluted EPS | $ | 0.03 | $ | (0.04 | ) | $ | 0.05 | $ | (0.11 | ) | |||||||
ShareBased_Payments
Share-Based Payments | 3 Months Ended |
Sep. 28, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' |
Share-Based Payments | ' |
(4) Share-Based Payments | |
The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. That cost is recognized over the period during which an employee is required to provide services in exchange for the award, the requisite service period (usually the vesting period). The Company provides an estimate of forfeitures at initial grant date. Reductions in compensation expense associated with the forfeited options are estimated at the date of grant, and this estimated forfeiture rate is adjusted periodically based on actual forfeiture experience. The company uses the Black-Scholes option pricing model to determine the fair value of the stock options granted. | |
There were no stock options granted under the Company’s 2009 Stock Incentive Plan (the “Plan”) during the quarters ended September 28, 2013 and September 29, 2012. During the three and nine months ended September 28, 2013 the Company recognized $66,385 and $182,150, respectively as share-based compensation expense related to previously granted shares under the Plan. | |
During the three and nine months ended September 29, 2012 the Company recognized $55,127 and $168,378, respectively, as share-based compensation expense related to previously granted shares under the Plan. | |
There were no option exercises during the quarter ended September 28, 2013 and September 29, 2012. No options expired during the quarters ended September 28, 2013 and September 29, 2012. |
Inventories
Inventories | 3 Months Ended | ||||||||
Sep. 28, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
(5) Inventories | |||||||||
Inventories consist of the following: | |||||||||
September 28, | December 29, | ||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 405,223 | $ | 312,213 | |||||
Work in process | 1,106,263 | 1,145,843 | |||||||
Finished goods | 914,374 | 1,306,259 | |||||||
Total inventory | 2,425,860 | 2,764,315 | |||||||
Reserve for obsolescence | (377,000 | ) | (307,000 | ) | |||||
Inventories, net | $ | 2,048,860 | $ | 2,457,315 | |||||
Accrued_Expenses
Accrued Expenses | 3 Months Ended | ||||||||
Sep. 28, 2013 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
Accrued Expenses | ' | ||||||||
(6) Accrued Expenses | |||||||||
Accrued expenses consist of the following: | |||||||||
September 28, | December 29, | ||||||||
2013 | 2012 | ||||||||
Accrued legal and accounting | $ | 114,575 | $ | 92,000 | |||||
Accrued payroll | 819,530 | 388,029 | |||||||
Accrued other | 226,588 | 458,014 | |||||||
$ | 1,160,693 | $ | 938,043 | ||||||
Line_of_Credit_and_Equipment_L
Line of Credit and Equipment Lease Facility Agreements | 3 Months Ended |
Sep. 28, 2013 | |
Debt Disclosure [Abstract] | ' |
Line of Credit and Equipment Lease Facility Agreements | ' |
Income_Taxes
Income Taxes | 3 Months Ended |
Sep. 28, 2013 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
(8) Income Taxes | |
At December 29, 2012, the Company had approximately $3,303 thousand of net operating loss carryforwards available to offset future income for U.S. Federal income tax purpose. | |
The Company recorded a tax expense of $159 thousand and $242 thousand for federal income taxes and a tax expense of $45 thousand and $69 thousand for state income taxes during the three and nine months ended September 28, 2013. | |
The Company has a current and non-current deferred tax asset aggregating $2,593 thousand and $2,787 thousand on the Company`s balance sheet at September 28, 2013 and December 29, 2012, respectively. The Company believes that it will generate sufficient future taxable income to realize the tax benefits related to the remaining deferred tax assets and as such no valuation allowance has been provided against the deferred tax asset. |
Commitments
Commitments | 3 Months Ended |
Sep. 28, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments | ' |
(9) Commitments | |
In July 2006, the Company entered into a lease for its current operating facilities of approximately 37,520 square feet of rentable space located on approximately seven acres at its current site in Norton, MA. The term of the lease is ten years. The lease is a triple net lease wherein the Company is responsible for payment of all real estate taxes, operating costs and utilities. The Company also has an option to buy the property and a first right of refusal during the term of the lease. Annual rental payments are $100 thousand in year one increasing to $150 thousand in year ten. | |
In February 2011, the Company entered into a one-year lease, with five options to renew for one year periods, for approximately 13,800 square feet of rentable space inside a larger building located at 79 Walton Street, Attleboro, Massachusetts. Monthly rent, which includes utilities, is $7 thousand. In October 2013, the Company renewed the lease through February, 2015. | |
Net_Income_Loss_Per_Common_and1
Net Income (Loss) Per Common and Common Equivalent Share (Tables) | 3 Months Ended | ||||||||||||||||
Sep. 28, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Basic and Diluted Earnings Per Share | ' | ||||||||||||||||
Three Months Ended | Nine-Months Ended | ||||||||||||||||
September 28, | September 29, | September 28, | September 29, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Basic EPS Computation: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net income (loss) | $ | 451,516 | $ | (530,945 | ) | $ | 690,628 | $ | (1,438,004 | ) | |||||||
Denominator: | |||||||||||||||||
Weighted average | |||||||||||||||||
Common shares | |||||||||||||||||
Outstanding | 13,198,506 | 12,871,659 | 13,010,591 | 12,868,934 | |||||||||||||
Basic EPS | $ | 0.03 | $ | (0.04 | ) | $ | 0.05 | $ | (0.11 | ) | |||||||
Diluted EPS Computation: | |||||||||||||||||
Numerator: | |||||||||||||||||
Net income (loss) | $ | 451,516 | $ | (530,945 | ) | $ | 690,628 | $ | (1,438,004 | ) | |||||||
Denominator: | |||||||||||||||||
Weighted average | |||||||||||||||||
Common shares | |||||||||||||||||
Outstanding | 13,198,506 | 12,871,659 | 13,010,591 | 12,868,934 | |||||||||||||
Dilutive effect of stock options | 323,989 | — | 231,478 | — | |||||||||||||
Total Shares | 13,522,495 | 12,871,659 | 13,242,069 | 12,868,934 | |||||||||||||
Diluted EPS | $ | 0.03 | $ | (0.04 | ) | $ | 0.05 | $ | (0.11 | ) |
Inventories_Tables
Inventories (Tables) | 3 Months Ended | ||||||||
Sep. 28, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
September 28, | December 29, | ||||||||
2013 | 2012 | ||||||||
Raw materials | $ | 405,223 | $ | 312,213 | |||||
Work in process | 1,106,263 | 1,145,843 | |||||||
Finished goods | 914,374 | 1,306,259 | |||||||
Total inventory | 2,425,860 | 2,764,315 | |||||||
Reserve for obsolescence | (377,000 | ) | (307,000 | ) | |||||
Inventories, net | $ | 2,048,860 | $ | 2,457,315 | |||||
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 3 Months Ended | ||||||||
Sep. 28, 2013 | |||||||||
Payables and Accruals [Abstract] | ' | ||||||||
Accrued Expenses | ' | ||||||||
September 28, | December 29, | ||||||||
2013 | 2012 | ||||||||
Accrued legal and accounting | $ | 114,575 | $ | 92,000 | |||||
Accrued payroll | 819,530 | 388,029 | |||||||
Accrued other | 226,588 | 458,014 | |||||||
$ | 1,160,693 | $ | 938,043 | ||||||