Document and Entity Information
Document and Entity Information Document - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 13, 2015 | |
Document Information [Line Items] | ||
Entity Registrant Name | Arrhythmia Research Technology Inc /DE/ | |
Entity Central Index Key | 819,689 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 2,786,539 |
Consolidated Balance Sheets (un
Consolidated Balance Sheets (unaudited) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 284,774 | $ 209,398 |
Trade accounts receivable, net of allowance for doubtful accounts of $48,000 at June 30, 2015 and $45,000 at December 31, 2014 | 4,357,896 | 3,536,747 |
Inventory, net | 2,490,723 | 2,514,241 |
Prepaid expenses and other current assets | 595,960 | 519,582 |
Total current assets | 7,729,353 | 6,779,968 |
Property, plant and equipment, net | 7,669,062 | 7,618,901 |
Intangible assets, net | 137,563 | 134,022 |
Other assets | 343,555 | 570,357 |
Total assets | 15,879,533 | 15,103,248 |
Current liabilities: | ||
Revolving line of credit, current portion | 0 | 2,071,495 |
Term notes payable, current portion | 576,705 | 490,341 |
Accounts payable | 2,182,438 | 1,857,156 |
Accrued expenses & other current liabilities | 610,014 | 405,975 |
Customer deposits | 113,178 | 98,110 |
Deferred revenue, current | 293,153 | 228,363 |
Liabilities from discontinued operations, current | 0 | 320,056 |
Total current liabilities | 3,775,488 | 5,471,496 |
Long-term liabilities: | ||
Revolving line of credit, non-current portion | 2,391,495 | 0 |
Term notes payable, non-current portion | 1,418,096 | 1,330,755 |
Subordinated promissory notes | 459,294 | 445,452 |
Deferred revenue, non-current | 360,811 | 610,430 |
Total long-term liabilities | 4,629,696 | 2,386,637 |
Total liabilities | $ 8,405,184 | $ 7,858,133 |
Commitments and Contingencies | ||
Shareholders' equity: | ||
Preferred stock, $1 par value; 2,000,000 shares authorized, none issued | $ 0 | $ 0 |
Common stock, $.01 par value; 10,000,000 shares authorized; 3,926,941 issued; 2,786,539 outstanding at June 30, 2015 and 3,926,491 issued, 2,778,339 outstanding at December 31, 2014 | 39,265 | 39,265 |
Additional paid-in-capital | 11,361,959 | 11,336,693 |
Treasury stock at cost, 1,139,952 shares at June 30, 2015 and 1,148,152 shares at December 31, 2014 | (3,110,701) | (3,133,883) |
Accumulated other comprehensive income | 0 | 42,502 |
Accumulated deficit | (816,174) | (1,039,462) |
Total shareholders’ equity | 7,474,349 | 7,245,115 |
Total liabilities and shareholders’ equity | $ 15,879,533 | $ 15,103,248 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) (Parentheticals) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Consolidated Balance Sheet Parenthetical [Line Items] | ||
Allowance for doubtful accounts receivable, current | $ 48,000 | $ 45,000 |
Shareholders' Equity | ||
Preferred stock, par value | $ 1 | $ 1 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 3,926,491 | 3,926,491 |
Common stock, shares outstanding | 2,786,539 | 2,778,339 |
Treasury stock, shares | 1,139,952 | 1,148,152 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Net sales | $ 5,659,094 | $ 6,253,757 | $ 11,517,436 | $ 12,283,600 |
Cost of sales | 4,626,940 | 5,119,734 | 9,688,886 | 9,838,291 |
Gross profit | 1,032,154 | 1,134,023 | 1,828,550 | 2,445,309 |
Selling and marketing | 262,609 | 240,408 | 520,581 | 532,080 |
General and administrative | 525,577 | 543,235 | 1,173,804 | 1,137,866 |
Research and development | 62,224 | 85,694 | 154,785 | 182,521 |
Total operating expenses | 850,410 | 869,337 | 1,849,170 | 1,852,467 |
Income (loss) from continuing operations | 181,744 | 264,686 | (20,620) | 592,842 |
Other income (expense): | ||||
Interest expense | (69,840) | (70,529) | (135,533) | (140,678) |
Other income (expense), net | 3,322 | 46,687 | 16,831 | 48,998 |
Total other expense, net | (66,518) | (23,842) | (118,702) | (91,680) |
Income (loss) from continuing operations before income taxes | 115,226 | 240,844 | (139,322) | 501,162 |
Income tax provision | 0 | 1,030 | 0 | 2,207 |
Net income (loss) from continuing operations | 115,226 | 239,814 | (139,322) | 498,955 |
Discontinued Operations: | ||||
Income (loss) from discontinued operations, net of tax provision of $0 for the three and six months ended June 30, 2015 and 2014 | 0 | 646 | 362,610 | (1,779) |
Net income | $ 115,226 | $ 240,460 | $ 223,288 | $ 497,176 |
Earnings (loss) per share - basic | ||||
Continuing operations | $ 0.04 | $ 0.09 | $ (0.05) | $ 0.18 |
Discontinued operations | 0 | 0 | 0.13 | 0 |
Earnings per share - basic | 0.04 | 0.09 | 0.08 | 0.18 |
Earnings (loss) per share - diluted | ||||
Continuing operations | 0.04 | 0.09 | (0.05) | 0.18 |
Discontinued operations | 0 | 0 | 0.13 | 0 |
Earnings per share - diluted | $ 0.04 | $ 0.09 | $ 0.08 | $ 0.18 |
Weighted average common shares outstanding - basic | 2,781,826 | 2,723,582 | 2,780,420 | 2,722,914 |
Weighted average common shares outstanding - diluted | 2,848,302 | 2,815,578 | 2,881,438 | 2,798,163 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parentheticals) (Parentheticals) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Statement of operations parentheticals [Abstract] | ||||
Tax benefit, discontinued operations | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Cash flows from operating activities: | ||
Net income | $ 223,288 | $ 497,176 |
Income (loss) from discontinued operations | (362,610) | 1,779 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Gain on sale of property, plant and equipment | (14,729) | (24,500) |
Depreciation and amortization | 730,013 | 750,616 |
Non-cash interest expense | 13,842 | 13,842 |
Change in allowance for doubtful accounts | 3,000 | 10,000 |
Share-based compensation expense | 19,888 | 26,548 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (824,149) | (83,113) |
Inventories | 23,518 | (752,266) |
Prepaid expenses and other current assets | (76,378) | (107,017) |
Other non-current assets | 226,802 | 66,128 |
Accounts payable | 325,282 | (397,948) |
Accrued expenses and other current liabilities | 283,897 | 879,531 |
Other non-current liabilities | (249,619) | (51,060) |
Net cash provided by (used in) operating activities of continuing operations | 322,045 | 829,716 |
Net cash provided by (used in) operating activites of discontinued operations | 0 | (1,509) |
Net cash provided by (used in) operating activities | 322,045 | 828,207 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (784,157) | (834,971) |
Proceeds from sale of property, plant and equipment | 20,700 | 24,500 |
Cash paid for patents and trademarks | (5,528) | (2,613) |
Net cash provided by (used in) investing activities from continuing operations | (768,985) | (813,084) |
Net cash provided by (used in) investing activities from discontinued operations | 0 | 0 |
Net cash provided by (used in) investing activities | (768,985) | (813,084) |
Cash flows from financing activities: | ||
Proceeds from (payments on) revolving line of credit, net | 320,000 | (478,000) |
Proceeds from equipment line of credit | 415,785 | 116,905 |
Payments on term notes payable | (242,080) | (198,854) |
Proceeds from stock option exercises | 28,611 | 25,575 |
Net cash provided by (used in) financing activities from continuing operations | 522,316 | (534,374) |
Net cash provided by (used in) financing activities from discontinued operations | 0 | 0 |
Net cash provided by (used in) financing activities | 522,316 | (534,374) |
Net increase (decrease) in cash and cash equivalents | 75,376 | (519,251) |
Cash and cash equivalents, beginning of period | 209,398 | 751,275 |
Cash and cash equivalents, end of period | 284,774 | 232,024 |
Less: cash and cash equivalents of discontinued operations at end of period | 0 | 0 |
Cash and cash equivalents of continuing operations at end of period | 284,774 | 232,024 |
Supplemental Cash Flow Information (unaudited) | ||
Cash paid for interest | 111,639 | 119,229 |
Non-cash activities: | ||
Equipment line of credit converted to term notes payable | 415,785 | 740,999 |
Reduction of restricted cash offset by performance guarantee | $ 0 | $ 975,430 |
Basis of Presentation (Notes)
Basis of Presentation (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Basis of presentation [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements (the "financial statements") include the accounts of Arrhythmia Research Technology, Inc. ® (“ART”) and its subsidiary, Micron Products, Inc. ® ("Micron" and together with ART, the “Company”). ART discontinued operations of its wholly-owned Pennsylvania subsidiary, RMDDxUSA Corp. (“RMDDxUSA”) and that subsidiary’s Prince Edward Island subsidiary, RMDDx Corporation (“RMDDx” and collectively with RMDDxUSA,“WirelessDx”) in the third quarter of 2012. In May 2014, RMDDxUSA filed for bankruptcy and the Chapter 7 discharge order was issued on March 20, 2015 and the case was closed (see Note 10). The WirelessDx results are presented herein as discontinued operations. All intercompany balances and transactions have been eliminated in consolidation. The unaudited interim consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Accordingly, certain information and footnote disclosures normally included in complete financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been omitted pursuant to such rules and regulations. These financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on March 20, 2015. Certain reclassifications have been made to prior period amounts to conform to the current year presentation. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. The Company's balance sheet at December 31, 2014 has been derived from the audited financial statements at that date, but does not include all the information and footnotes required by GAAP for complete financial statements. The information presented reflects, in the opinion of the management of the Company, all adjustments necessary for a fair presentation of the financial results for the interim periods presented. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Earnings per Share (Notes)
Earnings per Share (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share ("EPS") Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding. The computation of diluted earnings (loss) per share is similar to the computation of basic earnings (loss) per share except that the denominator is increased to include the average number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued. In addition, the numerator is adjusted for any changes in net income (loss) that would result from the assumed conversions of those potential shares. The following table presents the calculation of both basic and diluted EPS: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 Income (loss) from continuing operations $ 115,226 $ 239,814 $ (139,322 ) $ 498,955 Income (loss) from discontinued operations, net of tax — 646 362,610 (1,779 ) Net income available to common shareholders $ 115,226 $ 240,460 $ 223,288 $ 497,176 Basic EPS: Weighted average common shares outstanding 2,781,826 2,723,582 2,780,420 2,722,914 Income (loss) per share - basic Continuing operations $ 0.04 $ 0.09 $ (0.05 ) $ 0.18 Discontinued operations — — 0.13 — Consolidated basic EPS $ 0.04 $ 0.09 $ 0.08 $ 0.18 Diluted EPS: Weighted average common shares outstanding 2,781,826 2,723,582 2,780,420 2,722,914 Assumed conversion of net common shares issuable under stock option plans 33,546 53,492 68,088 44,028 Assumed conversion of net common shares issuable under warrants 32,930 38,504 32,930 31,221 Weighted average common and common equivalent shares outstanding, diluted 2,848,302 2,815,578 2,881,438 2,798,163 Income (loss) per share - diluted Continuing operations $ 0.04 $ 0.09 $ (0.05 ) $ 0.18 Discontinued operations — — 0.13 — Consolidated diluted EPS $ 0.04 $ 0.09 $ 0.08 $ 0.18 |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2015 | |
Inventories [Abstract] | |
Inventories, net | Inventories, net Inventories consist of the following: June 30, 2015 December 31, 2014 Raw materials $ 831,795 $ 873,306 Work-in-process 383,282 370,220 Finished goods 1,275,646 1,270,715 Total $ 2,490,723 $ 2,514,241 The cost of silver in inventory that is included in raw materials, work-in-process and finished goods had an estimated cost of $405,541 and $439,800 as of June 30, 2015 and December 31, 2014 , respectively. |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment, Net [Abstract] | |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment consist of the following: Asset Lives (in years) June 30, 2015 December 31, 2014 Machinery and equipment 3 to 15 $ 14,848,484 $ 14,608,949 Building and improvements 5 to 25 4,499,899 4,360,114 Vehicles 3 to 5 90,713 90,713 Furniture, fixtures, computers and software 3 to 5 1,426,071 1,349,931 Land 202,492 202,492 Construction in progress 697,926 568,234 Total property, plant and equipment 21,765,585 21,180,433 Less: accumulated depreciation (14,096,523 ) (13,561,532 ) Property, plant and equipment, net $ 7,669,062 $ 7,618,901 For the three months ended June 30, 2015 and 2014, the Company recorded depreciation expense of $372,637 and $364,264 , respectively. For the six months ended June 30, 2015 and 2014 , the Company recorded depreciation expense of $728,025 and $741,779 , respectively. |
Intangible Assets, Net (Notes)
Intangible Assets, Net (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Intangible Assets, Net [Abstract] | |
Intangibles Assets, Net | Intangible Assets, Net The Company assesses the impairment of long-lived assets and intangible assets with finite lives annually or whenever events or changes in circumstances indicate that the carrying value may not be fully recoverable. For the six months ended June 30, 2015, no impairment was required. Intangible assets consist of the following: June 30, 2015 December 31, 2014 Estimated Useful Life (in years) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Patents and trademarks 11 $ 414,437 $ 395,250 $ 19,187 $ 414,436 $ 394,371 $ 20,065 Patents and trademarks pending — 102,975 — 102,975 97,447 — 97,447 Trade names 7 33,250 17,849 15,401 33,250 16,740 16,510 Total intangible assets $ 550,662 $ 413,099 $ 137,563 $ 545,133 $ 411,111 $ 134,022 For the three and six months ended June 30, 2015 and 2014, the Company recorded amortization expense of $994 and $1,988 , respectively. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2015 | |
Debt [Abstract] | |
Debt | Debt The following table sets forth the items which comprise debt for the Company: June 30, 2015 December 31, 2014 Revolving line of credit $ 2,391,495 $ 2,071,495 Subordinated promissory notes $ 459,294 $ 445,452 Term notes payable: Commercial term loan $ 863,612 $ 1,009,977 Equipment term loans 987,574 640,734 Equipment notes 143,615 170,385 Total term notes payable $ 1,994,801 $ 1,821,096 Total Debt $ 4,845,590 $ 4,338,043 Bank Debt The revolving line of credit (the "revolver"), commercial term loan, two equipment term loans and an equipment line of credit are all under the terms of a multi-year credit facility with a bank as detailed below. The bank facility contains both financial and non-financial covenants, all of which the Company is in compliance with at June 30, 2015 . Revolver The revolver provides for borrowings up to 80% of eligible accounts receivable and 50% of eligible raw materials inventory. The interest rate on the revolver is calculated at the bank's prime rate plus 0.25% ( 3.50% at June 30, 2015 ). The original maturity date of the revolver was June 30, 2015, therefore, as of December 31, 2014 the balance of the revolver was classified as a current liability. In June 2015, the revolver was extended for an additional two-year period maturing June 30, 2017 and is therefore classified as a long-term liability on the Company's balance sheet at June 30, 2015 . Commercial term loan The commercial term loan has a five year term with a maturity date in March 2018. The interest rate on the loan is a fixed 4.25% per annum, and requires monthly payments of approximately $28,000 . Equipment line of credit and equipment term loans The original equipment line of credit allowed for advances of up to $1.0 million and included a one-year draw period during which payments were interest only. The draw period ended March 29, 2014 and the then outstanding balance on the equipment line of credit of $740,999 was converted to an equipment term loan with a five-year term, maturing on of March 29, 2019. The equipment term loan requires monthly payments of approximately $14,000 , consisting of principal and interest at a fixed rate of 4.65% . On June 26, 2014, the Company entered into an equipment line of credit that allowed for advances of up to $1.0 million and included a one-year draw period during which payments were interest only. The draw period ended June 26, 2015 and the then outstanding balance on the equipment line of credit of $415,785 was converted to an equipment term loan with a five-year term, maturing on of June 26, 2020. The equipment term loan requires monthly payments of approximately $8,000 , consisting of principal and interest at a fixed rate of 4.67% . On June 19, 2015, the Company entered into a new equipment line of credit for $1.0 million under the Company's multi-year credit facility. At June 30, 2015 , no amounts had been drawn on the new equipment line of credit. The term of this equipment line of credit is six years, maturing on June 19, 2021, inclusive of a maximum one-year draw period. Repayment shall consist of monthly interest only payments, equal to the bank's prime rate plus 0.25% as to each advance commencing on the date of the loan through the earlier of: (i) one year from the date of the loan or (ii) the date upon which the equipment line of credit is fully advanced (the “Conversion Date”). On the Conversion Date, principal and interest payments will be due and payable monthly in an amount sufficient to pay the loan in full based upon an amortization schedule commensurate with the remaining term of the loan. Other Debt Equipment notes In January 2013, the Company entered into two equipment notes totaling $272,500 with a financing company to acquire production equipment. The notes bear interest at the fixed rate of 4.66% and require monthly payments of principal and interest of approximately $5,000 over a five year term maturing in January 2018. Subordinated promissory notes In December 2013, the Company completed a private offering in which the Company sold an aggregate of $500,000 in subordinated promissory notes. The notes are unsecured and require quarterly interest-only payments at a rate of 10% per annum. On the second anniversary following issuance, the interest rate increases to 12% per annum. The notes mature in December 2016 at which point the outstanding balance is due in full. The subordinated promissory notes may be prepaid by the Company at any time following the first anniversary thereof without penalty. The notes are subordinated to all indebtedness of the Company pursuant to the bank credit facility. In connection with the subordinated promissory notes, the Company issued warrants to purchase the Company's common stock at $3.51 per share. The warrants expire in December 2016. The proceeds were allocated between the notes and warrants on a relative fair value basis resulting in $416,950 allocated to the notes and $83,050 allocated to the warrants as part of Additional-Paid-in-Capital. The total discount on the notes is being recognized as non-cash interest expense over the term of the notes. For the three and six months ended June 30, 2015 and 2014 , the Company recorded $6,921 and $13,842 , respectively, of non-cash interest expense related to the amortization of the discount. The unamortized discount which is net against the outstanding balance of the subordinated promissory notes is $40,706 at June 30, 2015 and $54,548 at December 31, 2014 . |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | Income Taxes The tax provisions for the three and six months ended June 30, 2015 and 2014 are attributable to the U.S. federal and state income taxes on our continuing operations. The Company has a full valuation allowance against its deferred tax assets at June 30, 2015 and December 31, 2014 . Management expects to reevaluate the allowance on its deferred tax assets at December 31, 2015. The Company has federal and state net operating loss carryforwards totaling $7,752,000 and $7,202,000 , respectively, which begin to expire in 2030. The Company also had federal and state tax credit carryovers of $243,000 and $281,000 respectively. The federal and state tax credits begin to expire in 2026 and 2015, respectively. During the first quarter of 2015, the Company's subsidiary, RMDDxUSA, was formally discharged in its bankruptcy proceedings. The tax attributes associated with this subsidiary expired upon the finalization of the bankruptcy. As a result, the Company's available foreign and state net operating loss carryforwards have been reduced by $1,039,000 and $4,315,000 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal matters In the ordinary course of its business, the Company is involved in various legal proceedings involving a variety of matters. The Company does not believe there are any pending legal proceedings that will have a material impact on the Company’s financial position or results of operations. Off-balance sheet arrangements In 2014, the Company entered into two operating leases for office equipment. Lease expense under all operating leases was approximately $1,822 for the three months ended June 30, 2015 and $3,644 for the six months ended June 30, 2015 and $0 for the same periods in 2014 . |
Stock Options & Share-based Inc
Stock Options & Share-based Incentive Plan | 6 Months Ended |
Jun. 30, 2015 | |
Stock Options [Abstract] | |
Stock Options & Share-based Incentive Plan | Stock Options and Share-Based Incentive Plan Options The following table sets forth the stock option transactions for the six months ended June 30, 2015 : Number of options Weighted average Exercise Price Weighted average remaining contractual term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2014 165,800 $ 5.58 6.09 $ 305,124 Granted 25,000 7.74 Exercised (8,200 ) 3.49 Forfeited (7,500 ) 6.45 Expired — — Outstanding at June 30, 2015 175,100 5.95 5.62 $ 277,863 Exercisable at June 30, 2015 102,600 $ 6.01 4.16 $ 167,218 Exercisable at December 31, 2014 74,400 $ 6.07 4.75 $ 119,342 For the six months ended June 30, 2015 and 2014 , share-based compensation expense related to stock options amounted to $19,888 and $26,548 , respectively, and is included in general and administrative expenses. For the six months ended June 30, 2015, 25,000 options were granted, 7,500 options were forfeited. Additionally, 8,200 options were exercised generating proceeds of $28,611 . For the six months ended June 30, 2014, there we no new grants and 56,500 options expired. Additionally, 9,600 options were exercised generating proceeds of $25,575 . Warrants For the six months ended June 30, 2015 and 2014 , there were no warrants exercised. As of June 30, 2015 , 70,000 warrants remain unexercised. |
Discontinued Operations
Discontinued Operations | 6 Months Ended |
Jun. 30, 2015 | |
Discontinued Operations [Abstract] | |
Discontinued Operations | Discontinued Operations On May 8, 2014, RMDDxUSA filed a voluntary petition for relief under Chapter 7 (Liquidation) of the United States Bankruptcy Code in the District of Massachusetts. A trustee was assigned to review the assets and liabilities of the company. At December 31, 2014, there were no assets and $320,056 of liabilities remaining on the balance sheet. On March 20, 2015, the Chapter 7 discharge order was issued by the assigned trustee and the case was closed. For the three months and six months ended June 30, 2015 , net income of $0 and $362,610 , respectively, net of tax, was recorded from discontinued operations as a result of the write off of the remaining liabilities of $320,056 and the reversal of other comprehensive income of $42,502 from cumulative translation adjustments from RMDDx Corporation. |
Subsequent Events (Notes)
Subsequent Events (Notes) | 6 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent Events Appointment of Director On July 22, 2015, the Company's Board of Directors appointed Mr. Marco F. Benedetti to serve as a director of the Company, effective July 22, 2015. A description of Mr. Benedetti's background can be found in the Current Report on Form 8-K filed on July 23, 2015. Amendment to Certificate of Incorporation At the Company's Annual Meeting on July 1, 2015, the Shareholders approved an amendment to the Company's Certificate of Incorporation to revise the terms of the 2,000,000 shares of preferred stock, $1.00 par value, to "blank check" preferred stock $0.001 par value ("Blank Check Preferred") in order to simplify the current terms of the 2,000,000 shares of Serial Preferred Stock ("Serial Preferred Stock") but not to otherwise affect the current authority of the Board to issue up to 2,000,000 shares of the Serial Preferred Stock. The Amendment became effective upon the filing of the Certificate of Amendment with the Delaware Secretary of State which was filed on July 10, 2015. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings per Share | The following table presents the calculation of both basic and diluted EPS: Three months ended June 30, Six months ended June 30, 2015 2014 2015 2014 Income (loss) from continuing operations $ 115,226 $ 239,814 $ (139,322 ) $ 498,955 Income (loss) from discontinued operations, net of tax — 646 362,610 (1,779 ) Net income available to common shareholders $ 115,226 $ 240,460 $ 223,288 $ 497,176 Basic EPS: Weighted average common shares outstanding 2,781,826 2,723,582 2,780,420 2,722,914 Income (loss) per share - basic Continuing operations $ 0.04 $ 0.09 $ (0.05 ) $ 0.18 Discontinued operations — — 0.13 — Consolidated basic EPS $ 0.04 $ 0.09 $ 0.08 $ 0.18 Diluted EPS: Weighted average common shares outstanding 2,781,826 2,723,582 2,780,420 2,722,914 Assumed conversion of net common shares issuable under stock option plans 33,546 53,492 68,088 44,028 Assumed conversion of net common shares issuable under warrants 32,930 38,504 32,930 31,221 Weighted average common and common equivalent shares outstanding, diluted 2,848,302 2,815,578 2,881,438 2,798,163 Income (loss) per share - diluted Continuing operations $ 0.04 $ 0.09 $ (0.05 ) $ 0.18 Discontinued operations — — 0.13 — Consolidated diluted EPS $ 0.04 $ 0.09 $ 0.08 $ 0.18 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory [Abstract] | |
Inventories | Inventories consist of the following: June 30, 2015 December 31, 2014 Raw materials $ 831,795 $ 873,306 Work-in-process 383,282 370,220 Finished goods 1,275,646 1,270,715 Total $ 2,490,723 $ 2,514,241 |
Property, Plant and Equipment20
Property, Plant and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, Net | Property, plant and equipment consist of the following: Asset Lives (in years) June 30, 2015 December 31, 2014 Machinery and equipment 3 to 15 $ 14,848,484 $ 14,608,949 Building and improvements 5 to 25 4,499,899 4,360,114 Vehicles 3 to 5 90,713 90,713 Furniture, fixtures, computers and software 3 to 5 1,426,071 1,349,931 Land 202,492 202,492 Construction in progress 697,926 568,234 Total property, plant and equipment 21,765,585 21,180,433 Less: accumulated depreciation (14,096,523 ) (13,561,532 ) Property, plant and equipment, net $ 7,669,062 $ 7,618,901 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Intangible Assets, Net [Abstract] | |
Intangibles Assets, Net | Intangible assets consist of the following: June 30, 2015 December 31, 2014 Estimated Useful Life (in years) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Patents and trademarks 11 $ 414,437 $ 395,250 $ 19,187 $ 414,436 $ 394,371 $ 20,065 Patents and trademarks pending — 102,975 — 102,975 97,447 — 97,447 Trade names 7 33,250 17,849 15,401 33,250 16,740 16,510 Total intangible assets $ 550,662 $ 413,099 $ 137,563 $ 545,133 $ 411,111 $ 134,022 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Debt [Abstract] | |
Debt | June 30, 2015 December 31, 2014 Revolving line of credit $ 2,391,495 $ 2,071,495 Subordinated promissory notes $ 459,294 $ 445,452 Term notes payable: Commercial term loan $ 863,612 $ 1,009,977 Equipment term loans 987,574 640,734 Equipment notes 143,615 170,385 Total term notes payable $ 1,994,801 $ 1,821,096 Total Debt $ 4,845,590 $ 4,338,043 |
Stock Options & Share-based I23
Stock Options & Share-based Incentive Plan (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Stock Options [Abstract] | |
Stock Option Transactions | The following table sets forth the stock option transactions for the six months ended June 30, 2015 : Number of options Weighted average Exercise Price Weighted average remaining contractual term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2014 165,800 $ 5.58 6.09 $ 305,124 Granted 25,000 7.74 Exercised (8,200 ) 3.49 Forfeited (7,500 ) 6.45 Expired — — Outstanding at June 30, 2015 175,100 5.95 5.62 $ 277,863 Exercisable at June 30, 2015 102,600 $ 6.01 4.16 $ 167,218 Exercisable at December 31, 2014 74,400 $ 6.07 4.75 $ 119,342 |
Earnings per Share - (Details)
Earnings per Share - (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Income (loss) from continuing operations | $ 115,226 | $ 239,814 | $ (139,322) | $ 498,955 |
Income (loss) from discontinued operations, net of tax | 0 | 646 | 362,610 | (1,779) |
Net income available to common shareholder | $ 115,226 | $ 240,460 | $ 223,288 | $ 497,176 |
Basic EPS: | ||||
Weighted average of common shares outstanding | 2,781,826 | 2,723,582 | 2,780,420 | 2,722,914 |
Income (loss) per share - basic | ||||
Continuing operations | $ 0.04 | $ 0.09 | $ (0.05) | $ 0.18 |
Discontinued operations | 0 | 0 | 0.13 | 0 |
Consolidated basic EPS | $ 0.04 | $ 0.09 | $ 0.08 | $ 0.18 |
Diluted EPS: | ||||
Weighted average of common shares outstanding | 2,781,826 | 2,723,582 | 2,780,420 | 2,722,914 |
Assumed conversion of net common shares issuable under stock options | 33,546 | 53,492 | 68,088 | 44,028 |
Assumed conversion of net common shares issuable under warrants | 32,930 | 38,504 | 32,930 | 31,221 |
Weighted average common and common equivalent shares outstanding, diluted | 2,848,302 | 2,815,578 | 2,881,438 | 2,798,163 |
Income (loss) per share - diluted | ||||
Continuing operations | $ 0.04 | $ 0.09 | $ (0.05) | $ 0.18 |
Discontinued operations | 0 | 0 | 0.13 | 0 |
Consolidated diluted EPS | $ 0.04 | $ 0.09 | $ 0.08 | $ 0.18 |
Inventories - (Details)
Inventories - (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Inventories | ||
Raw materials | $ 831,795 | $ 873,306 |
Work-in-process | 383,282 | 370,220 |
Finished goods | 1,275,646 | 1,270,715 |
Total | 2,490,723 | 2,514,241 |
Silver inventory | $ 405,541 | $ 439,800 |
Property, Plant and Equipment26
Property, Plant and Equipment, Net - (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment | |||
Machinery and equipment | $ 14,848,484 | $ 14,608,949 | |
Building and improvements | 4,499,899 | 4,360,114 | |
Vehicles | 90,713 | 90,713 | |
Furniture, fixtures, computers and software | 1,426,071 | 1,349,931 | |
Land | 202,492 | 202,492 | |
Construction in progress | 697,926 | 568,234 | |
Total property, plant and equipment | 21,765,585 | 21,180,433 | |
Less: accumulated depreciation | (14,096,523) | (13,561,532) | |
Property, plant and equipment, net | $ 7,669,062 | $ 7,618,901 | |
Machinery and equipment, minimum | |||
Property, Plant and Equipment | |||
Useful life | 3 years | ||
Building and improvements, minimum | |||
Property, Plant and Equipment | |||
Useful life | 5 years | ||
Vehicles, minimum | |||
Property, Plant and Equipment | |||
Useful life | 3 years | ||
Furniture, Fixtures, computers, and software, minimum | |||
Property, Plant and Equipment | |||
Useful life | 3 years | ||
Machinery and equipment, maximum | |||
Property, Plant and Equipment | |||
Useful life | 15 years | ||
Building and improvements, maximum | |||
Property, Plant and Equipment | |||
Useful life | 25 years | ||
Vehicles, maximum | |||
Property, Plant and Equipment | |||
Useful life | 5 years | ||
Furniture, fixtures, computers and software, maximum | |||
Property, Plant and Equipment | |||
Useful life | 5 years |
Property, Plant and Equipment27
Property, Plant and Equipment, Net - Depreciation Expense (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Depreciation [Abstract] | ||||
Depreciation expense | $ 372,637 | $ 364,264 | $ 728,025 | $ 741,779 |
Intangible Assets, Net - (Detai
Intangible Assets, Net - (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2014 | |
Intangible Assets [Line Items] | ||
Gross | $ 550,662 | $ 545,133 |
Accumulated Amortization | 413,099 | 411,111 |
Net | $ 137,563 | 134,022 |
Patents and Trademarks [Member] | ||
Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 11 years | |
Gross | $ 414,437 | 414,436 |
Accumulated Amortization | 395,250 | 394,371 |
Net | $ 19,187 | 20,065 |
Patents and trademarks pending [Member] | ||
Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | ||
Gross | $ 102,975 | 97,447 |
Accumulated Amortization | 0 | 0 |
Net | $ 102,975 | 97,447 |
Trade Names [Member] | ||
Intangible Assets [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 7 years | |
Gross | $ 33,250 | 33,250 |
Accumulated Amortization | 17,849 | 16,740 |
Net | $ 15,401 | $ 16,510 |
Intangible Assets, Net - Amorti
Intangible Assets, Net - Amortization and Impairment (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Amortization and Impairment [Abstract] | ||||
Intangible asset impairment | $ 0 | |||
Amortization expense | $ 994 | $ 994 | $ 1,988 | $ 1,998 |
Debt - Total Debt (Details)
Debt - Total Debt (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Total debt [Abstract] | ||
Revolving line of credit | $ 2,391,495 | $ 2,071,495 |
Subordinated promissory notes | 459,294 | 445,452 |
Term notes payable [Abstract] | ||
Commercial term loan | 863,612 | 1,009,977 |
Equipment term loan | 987,574 | 640,734 |
Equipment notes | 143,615 | 170,385 |
Total term notes payable | 1,994,801 | 1,821,096 |
Total debt | $ 4,845,590 | $ 4,338,043 |
Debt - Bank Debt (Details)
Debt - Bank Debt (Details) - USD ($) | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 26, 2015 | Jun. 26, 2014 | Mar. 29, 2014 | |
Revolving Credit Facility [Member] | ||||
Bank Debt [Line Items] | ||||
Percent Borrowable of net Elegible Recievable, Revolving Loan | 80.00% | |||
Percent Borrowable of net Eligible Raw Materials Inventory, Revolving Loan | 50.00% | |||
Revolving line of credit, interest in addition to prime rate | 0.25% | |||
Interest rate | 3.50% | |||
Commercial Loan [Member] | ||||
Bank Debt [Line Items] | ||||
Interest rate | 4.25% | |||
Approximate monthly principle and interest payment | $ 28,000 | |||
Equipment line of credit [Member] | ||||
Bank Debt [Line Items] | ||||
Interest rate | 4.65% | |||
Outstanding balance at end of draw period | $ 740,999 | |||
Approximate monthly principle and interest payment | $ 14,000 | |||
2014 Equipment line of credit [Member] | ||||
Bank Debt [Line Items] | ||||
Interest rate | 4.67% | |||
Maximum borrowing capacity | $ 1,000,000 | |||
Outstanding balance at end of draw period | $ 415,785 | |||
Approximate monthly principle and interest payment | $ 8,000 | |||
2015 Equipment line of credit [Member] | ||||
Bank Debt [Line Items] | ||||
Maximum borrowing capacity | $ 1,000,000 | |||
2014 Equipment line of credit, interest in addition to prime rate | 0.25% |
Debt - Other Debt (Details)
Debt - Other Debt (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 19, 2013 | Mar. 31, 2013 | |
Equipment notes [Member] | |||||||
Other debt [Line Items] | |||||||
Original outstanding balance | $ 272,500 | ||||||
Interest rate | 4.66% | 4.66% | |||||
Approximate monthly principle and interest payment | $ 5,000 | ||||||
Subordinated Debt [Member] | |||||||
Other debt [Line Items] | |||||||
Original outstanding balance | $ 500,000 | ||||||
Subordinated borrowing, Interest rate years 1 and 2 | 10.00% | ||||||
Subordinated Borrowing, Interest rate after year 2 | 12.00% | ||||||
Exercise price of warrants | $ 3.51 | ||||||
Fair value of notes, subordinated debt | $ 416,950 | 416,950 | |||||
Fair value of warrants, subordinated debt | 83,050 | 83,050 | |||||
Non cash interest expense, subordinated promissory notes | 6,921 | $ 6,921 | 13,842 | $ 13,842 | |||
Unamortized discount, net against outstanding balance of subordinated promissory notes | $ 40,706 | $ 40,706 | $ 54,548 |
Income Taxes - (Details)
Income Taxes - (Details) | Jun. 30, 2015USD ($) |
Federal [Member] | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforwards | $ 7,752,000 |
Tax credit carryover | 243,000 |
State [Member] | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforwards | 7,202,000 |
Operating loss carryforwards, reduction amount | 4,315,000 |
Tax credit carryover | 281,000 |
Foreign [Member] | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforwards, reduction amount | $ 1,039,000 |
Commitments and Contingencies -
Commitments and Contingencies - (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Other Commitments [Line Items] | ||||
Operating lease expense | $ 1,822 | $ 0 | $ 3,644 | $ 0 |
Stock Options & Share-based I35
Stock Options & Share-based Incentive Plan - Stock Option Transactions (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Stock Options | |||
Exercised in period | 8,200 | 9,600 | |
Forfeited in period | 7,500 | ||
Number of options | |||
Stock Options | |||
Outstanding | 175,100 | 165,800 | |
Granted in period | 25,000 | ||
Exercised in period | (8,200) | ||
Forfeited in period | (7,500) | ||
Expired in period | 0 | 56,500 | |
Exercisable | 102,600 | 74,400 | |
Weighted Average Exercise Price [Member] | |||
Stock Options | |||
Outstanding | $ 5.95 | $ 5.58 | |
Granted in period | 7.74 | ||
Exercised in period | 3.49 | ||
Forfeited in period | 6.45 | ||
Expired in period | 0 | ||
Exercisable | $ 6.01 | $ 6.07 | |
Weighted average remaining contractual term (in years) | |||
Stock Options | |||
Outstanding | 5 years 7 months 13 days | 6 years 1 month 2 days | |
Exercisable | 4 years 1 month 28 days | 4 years 9 months | |
Aggregate Intrinsic Value | |||
Stock Options | |||
Outstanding | $ 277,863 | $ 305,124 | |
Exercisable | $ 167,218 | $ 119,342 |
Stock Options & Share-based I36
Stock Options & Share-based Incentive Plan - Share-based Compensation (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Stock Options [Abstract] | ||
Share-based compensation expense | $ 19,888 | $ 26,548 |
Proceeds from stock option exercises | $ 28,611 | $ 25,575 |
Warrants [Abstract] | ||
Warrants exercised | 0 | 0 |
Warrants remained unexercised | 70,000 |
Discontinued Operations - Disco
Discontinued Operations - Discontinued Operations (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
Discontinued Operations Information [Abstract] | |||||
Liabilities from discontinued operations, current | $ 0 | $ 0 | $ 320,056 | ||
Income (loss) from discontinued operations, net of tax | 0 | $ 646 | 362,610 | $ (1,779) | |
Accumulated other comprehensive income | $ 0 | $ 0 | $ 42,502 |
Subsequent Events Amendment to
Subsequent Events Amendment to Certificate of Incorporation (Details) - $ / shares | Jul. 01, 2015 | Jun. 30, 2015 | Dec. 31, 2014 |
Subsequent Event [Line Items] | |||
Preferred stock, shares authorized | 2,000,000 | 2,000,000 | |
Preferred stock, par value | $ 1 | $ 1 | |
Blank Check Preferred Stock, par value | $ 0.001 | ||
Serial Preferred Stock | 2,000,000 |