Sevcon 10-Q 10 Aug 15 2015 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Jul. 04, 2015	Aug. 10, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	SEVCON, INC.
Entity Central Index Key	825,411
Current Fiscal Year End Date	--09-30
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		3,694,122
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 4, 2015

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jul. 04, 2015	Sep. 30, 2014
Current assets:
Cash and cash equivalents	$ 8,548	$ 11,238
Trade receivables, net of allowances for doubtful accounts of $4 at July 4, 2015 and $40 at September 30, 2014	7,764	6,694
Other receivables	564	183
Inventories	6,596	6,258
Prepaid expenses and other current assets	2,573	1,747
Total current assets	26,045	26,120
Property, plant and equipment, at cost:
Land and improvements	22	23
Buildings and improvements	713	741
Equipment	11,621	10,918
Property, plant and equipment, at cost	12,356	11,682
Less: accumulated depreciation	(9,702)	(9,577)
Net property, plant and equipment	2,654	2,105
Long-term deferred tax assets	3,315	3,910
Goodwill	1,435	1,435
Other long-term assets	417	397
Total assets	33,866	33,967
Current liabilities:
Current portion of long term debt	0	28
Accounts payable	5,144	4,405
Accrued expenses and other current liabilities	1,968	1,836
Accrued and deferred taxes on income	0	7
Total current liabilities	7,112	6,276
Liability for pension benefits	8,674	9,529
Long term debt	500	1,700
Total liabilities	$ 16,286	$ 17,505
Commitments and contingencies (Note 16)
Stockholders' equity:
Preferred stock, par value $.10 per share - authorized - 1,000,000 shares; Outstanding, 452,374 shares at July 4, 2015 and 460,769 shares at September 30, 2014	$ 45	$ 46
Common stock, par value $.10 per share - authorized 20,000,000 shares at July 4, 2015 and 8,000,000 at September 30, 2014; outstanding, 3,694,122 shares at July 4, 2015 and 3,588,958 at September 30, 2014	369	359
Premium paid in on common stock	6,507	6,040
Premium paid in on preferred stock	9,063	9,231
Retained earnings	10,448	9,495
Accumulated other comprehensive loss	(8,940)	(8,829)
Total Sevcon, Inc. and subsidiaries stockholders' equity	17,492	16,342
Noncontrolling interests	88	120
Total stockholders' equity	17,580	16,462
Total liabilities and stockholders' equity	$ 33,866	$ 33,967

CONSOLIDATED BALANCE SHEETS (U3

CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Jul. 04, 2015	Sep. 30, 2014
Current assets:
Trade receivables, allowances for doubtful accounts	$ 4	$ 40
Stockholders' equity:
Preferred stock, par value (in dollars per share)	$ 0.10	$ 0.10
Preferred stock, authorized (in shares)	1,000,000	1,000,000
Preferred stock, outstanding (in shares)	452,374	460,769
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, authorized (in shares)	20,000,000	8,000,000
Common stock, outstanding (in shares)	3,694,122	3,588,958

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract]
Net sales	$ 10,346	$ 9,657	$ 30,619	$ 27,876
Cost of sales	(6,158)	(6,081)	(17,861)	(16,866)
Gross profit	4,188	3,576	12,758	11,010
Selling, general and administrative expenses	(2,551)	(2,318)	(7,630)	(6,833)
Research and development expenses	(1,376)	(1,045)	(3,911)	(3,058)
Operating income	261	213	1,217	1,119
Interest expense	(14)	(18)	(54)	(53)
Interest income	4	0	20	1
Foreign currency gain (loss)	(21)	(7)	258	(131)
Change in fair value of foreign exchange contracts	132	0	(68)	0
Income before income tax	362	188	1,373	936
Income tax (provision) benefit	(83)	34	(188)	(64)
Net income	279	222	1,185	872
Net loss attributable to non-controlling interests	2	0	31	0
Net income attributable to Sevcon, Inc. and subsidiaries	281	222	1,216	872
Preference share dividends	(110)	0	(335)	0
Net income attributable to common stockholders	$ 171	$ 222	$ 881	$ 872
Net income per ordinary share - basic (in dollars per share)	$ 0.04	$ 0.07	$ 0.25	$ 0.26
Net income per ordinary share - diluted (in dollars per share)	$ 0.04	$ 0.06	$ 0.25	$ 0.25
Weighted average shares used in computation of earnings per share:
Basic (in shares)	3,486	3,406	3,459	3,394
Diluted (in shares)	3,577	3,499	4,913	3,468

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract]
Net income attributable to Sevcon, Inc. and subsidiaries	$ 281	$ 222	$ 1,216	$ 872
Other comprehensive income (loss) net of tax:
Foreign currency translation adjustment	174	22	(262)	118
Defined benefit pension plans:
Pension benefit plans adjustments during the period	66	57	198	170
Tax expense	(16)	(13)	(47)	(39)
Defined benefit pension plans total	50	44	151	131
Other comprehensive income (loss) net of tax	224	66	(111)	249
Comprehensive income	$ 505	$ 288	$ 1,105	$ 1,121

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014
Cash flow from operating activities:
Net income	$ 1,185	$ 872
Adjustments to reconcile net income to net cash generated from (used by) operating activities:
Depreciation	470	456
Unrealized loss on change in value of foreign exchange contracts	68	0
Stock-based compensation	406	225
Deferred tax provision	188	64
Increase (decrease) in cash resulting from changes in operating assets and liabilities:
Trade receivables	(1,712)	(306)
Other receivables	(285)	(494)
Inventories	(517)	(460)
Prepaid expenses and other current assets	(321)	(1,002)
Accounts payable	836	566
Accrued expenses	159	(178)
Accrued and deferred taxes on income	(99)	(12)
Liability for pension benefits	(308)	(264)
Net cash generated from (used by) operating activities	70	(533)
Cash flow used by investing activities:
Acquisition of property, plant and equipment	(1,088)	(559)
Investment in joint venture, net of cash acquired	0	322
Net cash used by investing activities	(1,088)	(237)
Cash flow used by financing activities:
Repayments of long term debt	(1,728)	(35)
Proceeds of long term debt	500	0
Preferred stock dividends paid	(263)	0
Purchase and retirement of common stock	(98)	(63)
Net cash used by financing activities	(1,589)	(98)
Effect of exchange rate changes on cash	(83)	109
Net decrease in cash	(2,690)	(759)
Beginning balance - cash and cash equivalents	11,238	2,062
Ending balance - cash and cash equivalents	8,548	1,303
Supplemental disclosure of cash flow information:
Cash paid for income taxes, net of refunds	86	12
Cash paid for interest	54	53
Conversion of preferred stock to common stock	$ 169	$ 0

Basis of presentation

Basis of presentation	9 Months Ended
	Jul. 04, 2015
Basis of presentation [Abstract]
Basis of presentation	(1) Basis of presentation Sevcon, Inc. (“Sevcon” or “the Company”) is a Delaware corporation organized on December 22, 1987 to carry on the electronic controls business previously performed by Tech/Ops, Inc. Through wholly-owned subsidiaries located in the United States, the United Kingdom, France, South Korea and Japan, and a joint venture located in China, the Company designs and sells, under the Sevcon name, controls for zero emission and hybrid electric vehicles. The controls are used to vary the speed and movement of vehicles, to integrate specialized functions and to prolong the shift life of vehicles’ power source. The Company’s customers are manufacturers of on-road, off-road and industrial vehicles including automobiles, buses, trucks, fork lift trucks, aerial lifts, mining vehicles, agricultural tractors and implements and other electrically powered vehicles and systems. Through another subsidiary located in the United Kingdom, Sevcon, Inc. manufactures special metalized film capacitors that are used as components in the power electronics, signaling and audio equipment markets. Prior the of disclosing separately research and development expenses and selling, general and administrative expenses. In 2014 these expenses were disclosed together as Selling, research and administrative expenses Accounting for wholly-owned subsidiaries The accompanying consolidated financial statements include the accounts of the Company’s wholly-owned subsidiaries; Sevcon USA, Inc., Sevcon Ltd., Industrial Capacitors (Wrexham) Ltd., Sevcon SAS, Sevcon Asia Limited and Sevcon Japan KK, in accordance with the provisions required by the Consolidation Topic 810 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). All material intercompany transactions have been eliminated. Accounting for joint-venture subsidiary For the Company's less than wholly owned subsidiary, Sevcon New Energy Technology (Hubei) Company Limited, the Company first analyzes whether this joint venture subsidiary is a variable interest entity (a “VIE”) in accordance with ASC 810 and if so, whether the Company is the primary beneficiary requiring consolidation. A VIE is an entity that has (i) insufficient equity to permit it to finance its activities without additional subordinated financial support or (ii) equity holders that lack the characteristics of a controlling financial interest. VIEs are consolidated by the primary beneficiary, which is the entity that has both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive benefits from the entity that potentially could be significant to the entity. Variable interests in a VIE are contractual, ownership, or other financial interests in a VIE that change with changes in the fair value of the VIE’s net assets. The Company continuously re-assesses (i) whether the entity is a VIE, and (ii) if the Company is the primary beneficiary of the VIE. If it is determined that the entity in which the Company holds its interest qualifies as a VIE and the Company is the primary beneficiary, it is consolidated. Based on the Company's analysis for its 50% owned joint venture, the Company has determined that it is a VIE and that the Company is the primary beneficiary. While the Company owns 50% of the equity interest in this subsidiary, the other 50% is owned by a local unrelated third party, and the joint venture agreement with that third party provides the Company with greater voting rights. Accordingly, the Company consolidates its joint venture under the VIE rules and reflects the third party’s 50% interest in the consolidated financial statements as a non-controlling interest. The Company records this non-controlling interest at its initial fair value, adjusting the basis prospectively for their share of the respective consolidated investments’ net income or loss or equity contributions and distributions. This non-controlling interest is not redeemable by the equity holders and is presented as part of permanent equity. Income and losses are allocated to the non-controlling interest holder based on its economic ownership percentage. In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normally recurring accruals) necessary to present fairly the financial position of Sevcon, Inc. as of July 4, 2015 and the results of operations and cash flows for the three and nine month periods ended July 4, 2015. These unaudited interim financial statements should be read in conjunction with the 2014 annual consolidated financial statements and related notes included in the 2014 Sevcon, Inc. Annual Report filed on Form 10-K (the “2014 10-K”). Unless otherwise indicated, each reference to a year means the Company’s fiscal year, which ends on September 30. The results of operations for the three and nine month periods ended July 4, 2015 are not necessarily indicative of the results to be expected for the full year.

Summary of significant accounti

Summary of significant accounting policies	9 Months Ended
	Jul. 04, 2015
Summary of significant accounting policies [Abstract]
Summary of significant accounting policies	(2) Summary of significant accounting policies There have been no changes since the end of 2014 to the significant accounting policies followed by Sevcon, Inc.

New accounting pronouncements

New accounting pronouncements	9 Months Ended
	Jul. 04, 2015
New accounting pronouncements [Abstract]
New accounting pronouncements	(3) New accounting pronouncements In May 2014, the FASB amended its guidance regarding revenue recognition and created a new Topic 606, “Revenue from Contracts with Customers”. The objectives for creating Topic 606 were to remove inconsistencies and weaknesses in revenue recognition, provide a more robust framework for addressing revenue issues, provide more useful information to users of the financial statements through improved disclosure requirements, simplify the preparation of financial statements by reducing the number of requirements to which an entity must refer, and improve comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve the core principle, an entity should apply the following steps: 1) identify the contract(s) with a customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations in the contract; and 5) recognize revenue when (or as) the entity satisfies a performance obligation. For public entities, the amendments are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. The amendments may be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the amendment recognized at the date of initial application. We are currently assessing the impact of adoption of this standard on our consolidated financial statements.

Stock-based compensation plans

Stock-based compensation plans	9 Months Ended
	Jul. 04, 2015
Stock-based compensation plans [Abstract]
Stock-based compensation plans	(4) Stock-based compensation plans Under the Company’s 1996 Equity Incentive Plan (the “Plan”) there were 139,578 shares reserved and available for grant at July 4, 2015. There were 183,400 shares reserved and available for grant at June 28, 2014. Recipients of grants must execute a standard form of non-competition agreement. The plan provides for the grant of Restricted Stock, Restricted Stock Units, Options, and Stock Appreciation Rights (“SARs”). SARs may be awarded either separately, or in relation to options granted, and for the grant of bonus shares. Options granted are exercisable at a price not less than fair market value on the date of grant. There were no options outstanding or exercisable at July 4, 2015 or June 28, 2014, and there were no options granted or exercised in the three and nine month periods ended July 4, 2015 and June 28, 2014. In December 2014, the Company granted 42,000 shares of restricted stock to eight employees, which will vest in two equal annual installments so long as the employee is then employed by the Company or as determined by the Compensation Committee. The estimated fair value of the stock on the date of grant was $330,000 based on the fair market value of stock on the date of issue. This unvested compensation is being charged to income on a straight line basis over two years. The charge to income for this employee restricted stock in the first nine months of 2015 was $82,000 and the subsequent charge will be approximately $41,000 on a quarterly basis. In December 2014, the Company granted 20,000 shares of restricted stock to three employees, which will vest in five equal annual installments so long as the employee is then employed by the Company or as determined by the Compensation Committee. The estimated fair value of the stock on the date of grant was $139,000 based on the fair market value of stock on the date of issue. This unvested compensation is being charged to income on a straight line basis over five years. The charge to income for this employee restricted stock in the first nine months of 2015 was $14,000 and the subsequent charge will be approximately $7,000 on a quarterly basis. In February 2015, the Company granted 30,600 shares of restricted stock to nine non-employee directors, which will vest on the day before the 2016 annual meeting providing that the grantee remains a director of the Company, or as otherwise determined by the Compensation Committee. The aggregate fair value of the stock measured on the date of grant was $225,000, based on the closing sale price of the stock on the date of grant. Compensation expense is being charged to income on a straight line basis over the twelve month period during which the forfeiture conditions lapse. The charge to income for these restricted stock grants in the first nine months of fiscal 2015 was $75,000 and the subsequent charge will be approximately $56,000 on a quarterly basis. A summary of restricted stock activity for the nine months ended July 4, 2015 is as follows: Number of shares of Restricted Stock Weighted Average Grant-Date Fair Value Non-vested balance as of September 30, 2014 168,600 $ 5.27 Granted 92,600 $ 7.68 Vested (64,600 ) $ 6.32 Non-vested balance as of July 4, 2015 196,600 $ 6.07 Stock-based compensation expense was $147,000 and $406,000 for the three and nine month periods ended July 4, 2015 and $98,000 and $225,000 for the three and nine month periods ended June 28, 2014, respectively. At July 4, 2015, there was $923,000 of unrecognized compensation expense related to restricted stock granted under the Plan. The Company expects to recognize that cost over a weighted average period of 2.3 years.

Cash dividends

Cash dividends	9 Months Ended
	Jul. 04, 2015
Cash dividends [Abstract]
Cash dividends	(5) Cash dividends Common stock dividends The Board of Directors suspended common stock dividends to conserve cash during the global recession that began in 2009 and will consider whether to resume paying common stock dividends as conditions and the Company’s operating results improve. Preferred Stock dividends At July 4, 2015 there were 452,374 shares of Series A Convertible Preferred Stock issued and outstanding. The preferred stock, which has a stated value of $24 per share, pays a 4% cumulative annual dividend semi-annually on October 15 and April 15 each year. Semi dividends 42,000 and $ 000 were October 15, 2014 and , respectively

Calculation of earnings per sha

Calculation of earnings per share and weighted average shares outstanding	9 Months Ended
	Jul. 04, 2015
Calculation of earnings per share and weighted average shares outstanding [Abstract]
Calculation of earnings per share and weighted average shares outstanding	(6) Calculation of earnings per share and weighted average shares outstanding Basic earnings per share is computed by dividing the net income or loss for the period attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except that the numerator of net income attributable to common stockholders is adjusted by the effect of dilutive securities, including convertible preferred stock using the treasury stock method. The denominator is increased for the assumed exercise of dilutive options and other potentially dilutive securities, including convertible preferred stock and unvested restricted stock, using the treasury stock method, unless the effect is anti-dilutive. Basic and diluted net income per common share for the three and nine month periods ended July 4, 2015 and June 28, 2014 were calculated as follows: (in thousands of dollars except per share data) Three months ended Nine months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Numerator: Net income attributable to common stockholders for computing net income per ordinary share - basic $ 171 $ 222 $ 881 $ 872 Dividend eliminated upon assumed conversion of convertible preference shares - - 335 - Net income attributable to common stockholders for computing net income per ordinary share - diluted $ 171 $ 222 $ 1,216 $ 872 Denominator: Weighted average shares used in calculating net income per ordinary share - basic 3,486 3,406 3,459 3,394 Adjustment for assumed conversion of convertible preference shares - - 1,374 - Adjustment for shares issuable upon vesting of restricted stock 91 93 80 74 Weighted average shares used in calculating net income per ordinary share - diluted 3,577 3,499 4,913 3,468 Net income per ordinary share - basic $ 0.04 $ 0.07 $ 0.25 $ 0.26 Net income per ordinary share - diluted $ 0.04 $ 0.06 $ 0.25 $ 0.25 No. of shares of convertible preference stock excluded during the period as such shares and related dividends would have the effect increasing earnings per share 1,357 - - -

Segment information

Segment information	9 Months Ended
	Jul. 04, 2015
Segment information [Abstract]
Segment information	(7) Segment information The Company has two reportable segments: electronic controls and capacitors. The electronic controls segment produces control systems for zero emission and hybrid electric vehicles. The capacitors segment produces metalized film capacitors for sale to electronic equipment manufacturers. Each segment has its own management team and sales force and the capacitors segment has its own manufacturing facility. The significant accounting policies of the segments are those described in Note 1 to the Notes to Consolidated Financial Statements in the 2014 10-K. Inter-segment revenues are accounted for at current market prices. The Company evaluates the performance of each segment principally based on operating income. The Company does not allocate income taxes, interest income and expense or foreign currency translation gains and losses to segments. Information concerning operations of these businesses is as follows: (in thousands of dollars) Three months ended July 4, 2015 Controls Capacitors Corporate Total Sales to external customers $ 9,820 526 - $ 10,346 Inter segment revenues - - - - Operating income (loss) 342 5 (86 ) 261 Identifiable assets, excluding goodwill 24,033 1,248 7,150 32,431 Three months ended June 28, 2014 Controls Capacitors Corporate Total Sales to external customers $ 9,063 $ 594 - $ 9,657 Inter-segment revenues - 3 - 3 Operating income (loss) 194 108 (89 ) 213 Identifiable assets, excluding goodwill 21,907 1,462 664 24,033 Nine months ended July 4, 2015 Controls Capacitors Corporate Total Sales to external customers $ 29,000 1,619 - $ 30,619 Inter-segment revenues - 3 - 3 Operating income 1,064 121 32 1,217 Identifiable assets, excluding goodwill 24,033 1,248 7,150 32,431 Nine months ended June 28, 2014 Controls Capacitors Corporate Total Sales to external customers $ 26,199 $ 1,677 - $ 27,876 Inter-segment revenues - 5 - 5 Operating income (loss) 1,033 252 (166 ) 1,119 Identifiable assets, excluding goodwill 21,907 1,462 664 24,033 In the electronic controls segment, revenues derived from the following products and services: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Electronic controls for zero emission and hybrid electric vehicles $ 7,445 $ 6,591 $ 19,746 $ 19,730 Accessory and aftermarket products and services and engineering contracts 2,375 2,472 9,254 6,469 Total electronic controls segment revenues $ 9,820 $ 9,063 $ 29,000 $ 26,199

Research and development

Research and development	9 Months Ended
	Jul. 04, 2015
Research and development [Abstract]
Research and development	(8) Research and development The cost of research and development programs is charged against income as incurred. In recent years the Company has received several awards of research and development grants by public bodies established by the U.K. government to stimulate technology-enabled innovation. In 2011, the Company was awarded a research and development grant by the UK Technology Strategy Board to lead a collaborative project with Cummins Generator Technologies and Newcastle University in the U.K. to develop an innovative electric drive system for electric vehicles using advanced switched reluctance motor technology. The Company recorded grant income from this Technology Strategy Board project of $69,000 in the nine month period ended July 4, 2015, associated with research and development expense of $245,000, in the same period. The Company recorded grant income of $61,000 in the nine month period ended June 28, 2014, associated with research and development expense of $180,000, in the same period. In July 2013, the Company was awarded a grant of approximately $480,000 by the Low Emission Transport Collaborative Projects Fund, a U.K. government body. The grant is to develop next-generation controls for high-voltage, low-power applications. This grant defrayed part of the research and development expense associated with this project over the period from July 2013 to March 31, 2015 and included a commitment to increase employment by twenty five heads at the Company’s U.K. facility. The Company recorded grant income from this project of $53,000 in the nine month period ended July 4 2015, associated with research and development expense of $450,000, in the same period. The Company recorded grant income of $339,000 in the nine month period ended June 28, 2014, associated with research and development expense of $1,392,000, in the same period. The Company has received payment for the full amount of the awarded grant although there is an on-going obligation under the terms of the grant award to complete the job creation target by adding a further ten permanent positions at the Company’s U.K. facility by the end of the second quarter of 2017. In the third quarter of 2015 the Company was awarded a grant of approximately $625,000 by the U.K. Regional Growth Fund, a U.K. government body. The grant is to develop an innovative range of low voltage motor controls which are designed to serve the emerging needs for on-road, automotive electrification. The grant will defray part of the research and development expense associated with this project over the period to March 31, 2017 and includes a commitment to create or safeguard a total of twenty jobs at the Company’s U.K. facility over the period of the project. The Company recorded grant income from this project of $37,000 in the three and nine month period ended July 4, 2015 associated with research and development expense of $149,000. The grant income in the first nine months of 2015 and 2014 was recorded as a reduction of research and development expense.

Employee benefit plans

Employee benefit plans	9 Months Ended
	Jul. 04, 2015
Employee benefit plans [Abstract]
Employee benefit plans	(9) Employee benefit plans Sevcon has defined contribution plans covering the majority of its U.S. and U.K. employees in the controls business. There is also a small defined contribution plan covering senior managers in the capacitor business. The Company has frozen the U.K. and U.S. defined benefit plans for which no future benefits are being earned by employees. The following table sets forth the components of the net pension cost for the three and nine month periods ended July 4, 2015 and June 28, 2014, respectively: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Interest cost $ 308 $ 330 $ 928 $ 973 Expected return on plan assets (311 ) (331 ) (937 ) (978 ) Amortization of net loss 66 57 198 170 Net periodic benefit cost 63 56 189 165 Net cost of defined contribution plans $ 87 $ 125 $ 359 $ 372 Net cost of all employee benefit plans $ 150 $ 181 $ 548 $ 537 The following table sets forth the movement in the liability for pension benefits in the nine month periods ended July 4, 2015 and June 28, 2014, respectively: (in thousands of dollars) Nine Months ended July 4, 2015 June 28, 2014 Liability for pension benefits at beginning of period 9,529 8,354 Interest cost 928 973 Expected return on plan assets (937 ) (978 ) Plan contributions (497 ) (429 ) Effect of exchange rate changes (349 ) 400 Balance at end of period 8,674 8,320 Amounts recognized in the balance sheet consist of: (in thousands of dollars) July 4, 2015 September, 30, 2014 Non-current liabilities $ 8,674 $ 9,529 Amounts recognized in accumulated other comprehensive loss consist of: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Actuarial loss, net of $16 and $47 tax benefit for the three and nine month periods, respectively, (2014: net of $13 and $39 tax benefit for the three and nine month periods, respectively) $ 50 $ 44 $ 151 $ 131 Sevcon, Inc. contributed $150,000 to its frozen U.S. defined benefit plan in the nine months ended July 4, 2015; it presently anticipates contributing a further $50,000 to fund its U.S. plan in the remainder of fiscal 2015. In addition, employer contributions to the frozen U.K. defined benefit plan were $347,000 in the first nine months and are estimated to total $464,000 in 2015. In the second quarter of 2015, the assets of the frozen U.K. defined benefit plan (the Sevcon Limited Pension Plan, “the Plan”) were reorganized by the trustees of the Plan. The trustees appointed Legal & General Investment Management to sell the Plan investments held in pooled funds previously managed by Standard Life Investments and a holding in the Absolute Return Fund managed by Ruffer LLP. The cash proceeds were subsequently invested as to 80% in an investment in Adept Strategy 9 Fund, a sub-fund of Adept Investment Management plc, a Qualifying Investor Alternative Investment Fund authorized and supervised by the Central Bank of Ireland. The other 20% of the cash proceeds were invested in a range of Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds to match the profile of the Plan’s liability cash flows. The table below presents information about the Company’s pension plan assets measured and recorded at fair value as of July 4, 2015 and indicates the fair value hierarchy of the inputs utilized by the Company to determine the fair values. (in thousands of dollars) Level 1* (Quoted prices in active markets) Level 2** (Significant observable inputs) Level 3*** (Unobservable inputs) Mutual Funds Adept Strategy 9 Fund (a sub-fund of Adept Investment Management plc) 13,848 Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds (funds Managed by Schroder Investment Management Limited) 3,437 U.S. Equity Funds 376 U.S. Mutual Funds and Fixed Income Funds 2,672 Other Types of Investments 349 Cash Total 3,397 17,285 The table below presents information about the Company’s pension plan assets measured and recorded at fair value as of September 30, 2014: (in thousands of dollars) Level 1* (Quoted prices in active markets) Level 2** (Significant observable inputs) Level 3*** (Unobservable inputs) Mutual Funds Standard Life Pension Global Absolute Returns Strategies Fund 7,187 Standard Life UK Indexed Linked Fund 1,856 Standard Life Long Corporate Bond Fund 1,785 CF Ruffer Absolute Return Fund 7,177 U.S. Mutual Funds 2,431 U.S. Exchange Traded Funds 348 Other Types of Investments Cash 333 Total 21,117 * Level 1 inputs are quoted, unadjusted prices in active markets for identical assets or liabilities at the measurement date. The Company’s pension plan financial assets in U.S. Equity Funds, Mutual Funds and Fixed Income Funds are Level 1 assets ** Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The Company’s pension plan financial assets held in the Adept Strategy 9 Fund and the Schroder investments are Level 2 assets . The Company uses the Net Asset Value to determine the fair value of underlying investments which (a) do not have readily determinable fair value; and (b) prepare their financial statements consistent with the measurement principles of an investment company. The Funds are not exchange traded. The Funds are not subject to any redemption notice periods or restrictions and can be redeemed on a daily basis. No gates or holdbacks or dealing suspensions are being applied to the Funds. The Funds are of perpetual duration. *** Level 3 inputs are unobservable inputs for an asset or liability. The Company currently does not have any Level 3 pension plan financial assets. The following estimated benefit payments have been, or are expected, to be paid: (in thousands of dollars) 2015 $ 668 2016 707 2017 697 2018 695 2019 671 2020 – 2024 $ 3,658

Inventories

Inventories	9 Months Ended
	Jul. 04, 2015
Inventories [Abstract]
Inventories	(10) Inventories Inventories, net of reserve, were comprised of: (in thousands of dollars) July 4, 2015 September 30, 2014 Raw materials $ 3,698 $ 2,095 Work-in-process 90 102 Finished goods 2,808 4,061 $ 6,596 $ 6,258

Fair value of financial instrum

Fair value of financial instruments	9 Months Ended
	Jul. 04, 2015
Fair value of financial instruments [Abstract]
Fair value of financial instruments	(11) Fair value of financial instruments The Company's financial instruments consist mainly of cash and cash equivalents, short-term investments, accounts receivable and accounts payable. The carrying amount of these financial instruments as of July 4, 2015 approximates fair value due to the short-term nature of these instruments.

Derivative financial instrument

Derivative financial instruments	9 Months Ended
	Jul. 04, 2015
Derivative financial instruments [Abstract]
Derivative financial instruments	(12) Derivative financial instruments The Company uses derivative financial instruments to partially offset its market exposure to fluctuations in certain foreign currencies, principally the British Pound and the Euro, and does not enter into derivative contracts for speculative or trading purposes. Derivative financial instruments designated as cash flow hedges The Company documents at the inception of the transaction the relationship between the hedging instruments and the hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Company also documents its assessment, both at hedge inception and on an on-going basis, whether the derivative financial instruments that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in equity in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in the consolidated statement of income within “Other income and expense”. Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss (for example, when foreign currency denominated financial liabilities are translated into their functional currencies). The gain or loss relating to the effective portion of cross currency swaps which hedge the effects of changes in foreign exchange rates are recognized in the consolidated statement of income within “foreign exchange differences”. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in the consolidated statement of income. The company did not have any financial instruments designated as cash flow hedges at July 4, 2015 or June 28, 2014. Derivative financial instruments not designated for hedging The fair value of derivative financial instruments that do not meet the FASB authoritative guidance for hedge accounting are immediately recognized in the consolidated statement of income under “Other income and expense”. The fair value of these derivatives are recorded under “Prepaid expenses and other current assets” for asset derivatives or “Accrued expenses and other current liabilities” for liability derivatives, in the consolidated balance sheet. In the quarter ended April 4, 2015 the company entered into foreign currency forward contracts to hedge its exposure to future fluctuations in the exchange rate between the U.S. Dollar and the Euro. These contracts were intended to partially hedge the U.S. Dollar equivalent cost of the company’s planned purchases of inventory denominated in Euros. The total gross amount of the outstanding forward contracts was $2,009,000 at July 4, 2015 ($0 at September 30, 2014). These agreements were recorded at fair value in the consolidated balance sheet, resulting in a net gain of $132,000 and a net loss of $68,000 in the consolidated statement of income for the three and nine month periods, respectively, ended July 4, 2015 ($0 net gain or loss for the three and nine month periods ended June 28, 2014). The following table presents the fair values of the Company’s derivative financial instruments for the following periods: (in thousands of dollars) July 4, 2015 September 30, 2014 Assets Liabilities Assets Liabilities Foreign currency contracts - 68 - - The above liability derivative foreign currency contracts represent a Level 2 liability at July 4, 2015 in accordance with the fair value hierarchy described in Note 9.

Accrued expenses

Accrued expenses	9 Months Ended
	Jul. 04, 2015
Accrued expenses [Abstract]
Accrued expenses	(13) Accrued expenses Set out below is an analysis of other accrued expenses at July 4, 2015 and September 30, 2014, which shows separately any items in excess of 5% of total current liabilities: (in thousands of dollars) July 4, 2015 September 30, 2014 Accrued compensation and related costs $ 886 $ 1,062 Other accrued expenses 1,082 774 $ 1,968 $ 1,836

Warranty reserves

Warranty reserves	9 Months Ended
	Jul. 04, 2015
Warranty reserves [Abstract]
Warranty reserves	(14) Warranty reserves Warranty reserves are included on the balance sheet within accrued expenses; the movement in warranty reserves was as follows: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Warranty reserves at beginning of period $ 144 $ 140 $ 153 $ 138 Decrease in beginning balance for warranty obligations settled during the period - (5 ) - (49 ) Foreign currency translation adjustment 3 - (9 ) 2 Net increase in warranty reserves for products sold during the period and warranty expiration - 8 3 52 Warranty reserves at end of period $ 147 $ 143 $ 147 $ 143

Debt

Debt	9 Months Ended
	Jul. 04, 2015
Debt [Abstract]
Debt	(15) Debt The Company’s wholly owned subsidiary, Sevcon USA, Inc., has a $3,500,000 secured revolving credit facility with Citizens Bank, for working capital and general corporate purposes. The loan and security agreement will expire on June 14, 2017 when any outstanding principal and unpaid interest at that time will be due and payable in full. The facility may be paid before maturity in whole or in part at the option of Sevcon USA, Inc., without penalty or premium. Under the facility, Sevcon USA, Inc. must maintain, on a quarterly basis, a debt to tangible net worth ratio of no more than 2.40:1 and a debt service coverage ratio of no less than 1.25:1 for each rolling twelve-month period. Interest on the loan is payable monthly, and is calculated at a margin of 3.125% over LIBOR. The total amount outstanding under this secure revolving credit facility at July 4, 2015 was $500,000 and at September 30, 2014 was $1,700,000. The fair value of the debt at July 4, 2015 was $500,000. In July 2015, the Company’s U.K. bank renewed the overdraft facilities of the Company’s U.K. controls and capacitor subsidiaries. The Company’s U.K. controls and capacitor subsidiaries each have multi-currency overdraft facilities which together total $1,400,000 and which are secured by real estate owned by those companies. The renewal of the facilities is for a twelve month period although they can be withdrawn on demand by the bank. The facilities were unused at July 4, 2015 and at September 30, 2014. Annual principal payments on secured revolving credit facility at July 4, 2015 are as follows: (in thousands of dollars) 2017 $ 500 Total $ 500

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Jul. 04, 2015
Commitments and Contingencies [Abstract]
Commitments and Contingencies	(16) Commitments and Contingencies Sevcon, Inc. is involved in various legal proceedings in the ordinary course of business but believes that it is remote that the outcome will be material to operations. The Company maintains a directors' retirement plan which provides for certain retirement benefits to non-employee directors. Effective January 1997 the plan was frozen and no further benefits are being accrued. While the cost of the plan has been fully charged to expense, the plan is not separately funded. The estimated maximum liability which has been recorded based on the cost of buying deferred annuities at July 4, 2015 and September 30, 2014 was $156,000 and $162,000, respectively. Minimum rental commitments under all non-cancelable leases are as follows for the years ended September 30, 2015 - $213,000; 2016 - $205,000; 2017 - $205,000; 2018 - $208,000; 2019 - $194,000 and $3,405,000 thereafter. The U.K. subsidiaries of the Company have given to RBS Nat West Bank a security interest in certain leasehold and freehold property assets as security for overdraft facilities of $1,400,000. There were no amounts outstanding on the overdraft facilities at July 4, 2015 and at September 30, 2014. The obligations under a secured revolving credit facility entered into in 2011 by the U.S. subsidiary of the Company, are guaranteed by the Company and are secured by all of the assets and a pledge of all of the capital stock, of Sevcon USA, Inc. The total amount outstanding under this revolving credit facility was $500,000 at July 4, 2015 and $1,700,000 at September 30, 2014.

Subsequent events

Subsequent events	9 Months Ended
	Jul. 04, 2015
Subsequent events [Abstract]
Subsequent events	(17) Subsequent events In preparing these interim consolidated financial statements, the Company has evaluated, for potential recognition or disclosure, events or transactions subsequent to the end of the most recent quarterly period, the issuance date of these financial statements. No material subsequent events were identified that require recognition or disclosure in these financial statements.

Stock-based compensation plans

Stock-based compensation plans (Tables)	9 Months Ended
	Jul. 04, 2015
Stock-based compensation plans [Abstract]
Summary of restricted stock activity	A summary of restricted stock activity for the nine months ended July 4, 2015 is as follows: Number of shares of Restricted Stock Weighted Average Grant-Date Fair Value Non-vested balance as of September 30, 2014 168,600 $ 5.27 Granted 92,600 $ 7.68 Vested (64,600 ) $ 6.32 Non-vested balance as of July 4, 2015 196,600 $ 6.07

Calculation of earnings per s25

Calculation of earnings per share and weighted average shares outstanding (Tables)	9 Months Ended
	Jul. 04, 2015
Calculation of earnings per share and weighted average shares outstanding [Abstract]
Basic and fully diluted earnings per share	Basic and diluted net income per common share for the three and nine month periods ended July 4, 2015 and June 28, 2014 were calculated as follows: (in thousands of dollars except per share data) Three months ended Nine months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Numerator: Net income attributable to common stockholders for computing net income per ordinary share - basic $ 171 $ 222 $ 881 $ 872 Dividend eliminated upon assumed conversion of convertible preference shares - - 335 - Net income attributable to common stockholders for computing net income per ordinary share - diluted $ 171 $ 222 $ 1,216 $ 872 Denominator: Weighted average shares used in calculating net income per ordinary share - basic 3,486 3,406 3,459 3,394 Adjustment for assumed conversion of convertible preference shares - - 1,374 - Adjustment for shares issuable upon vesting of restricted stock 91 93 80 74 Weighted average shares used in calculating net income per ordinary share - diluted 3,577 3,499 4,913 3,468 Net income per ordinary share - basic $ 0.04 $ 0.07 $ 0.25 $ 0.26 Net income per ordinary share - diluted $ 0.04 $ 0.06 $ 0.25 $ 0.25 No. of shares of convertible preference stock excluded during the period as such shares and related dividends would have the effect increasing earnings per share 1,357 - - -

Segment information (Tables)

Segment information (Tables)	9 Months Ended
	Jul. 04, 2015
Segment information [Abstract]
Information concerning operations of business segments	Information concerning operations of these businesses is as follows: (in thousands of dollars) Three months ended July 4, 2015 Controls Capacitors Corporate Total Sales to external customers $ 9,820 526 - $ 10,346 Inter segment revenues - - - - Operating income (loss) 342 5 (86 ) 261 Identifiable assets, excluding goodwill 24,033 1,248 7,150 32,431 Three months ended June 28, 2014 Controls Capacitors Corporate Total Sales to external customers $ 9,063 $ 594 - $ 9,657 Inter-segment revenues - 3 - 3 Operating income (loss) 194 108 (89 ) 213 Identifiable assets, excluding goodwill 21,907 1,462 664 24,033 Nine months ended July 4, 2015 Controls Capacitors Corporate Total Sales to external customers $ 29,000 1,619 - $ 30,619 Inter-segment revenues - 3 - 3 Operating income 1,064 121 32 1,217 Identifiable assets, excluding goodwill 24,033 1,248 7,150 32,431 Nine months ended June 28, 2014 Controls Capacitors Corporate Total Sales to external customers $ 26,199 $ 1,677 - $ 27,876 Inter-segment revenues - 5 - 5 Operating income (loss) 1,033 252 (166 ) 1,119 Identifiable assets, excluding goodwill 21,907 1,462 664 24,033
Revenues of electronic controls segment by products and services	In the electronic controls segment, revenues derived from the following products and services: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Electronic controls for zero emission and hybrid electric vehicles $ 7,445 $ 6,591 $ 19,746 $ 19,730 Accessory and aftermarket products and services and engineering contracts 2,375 2,472 9,254 6,469 Total electronic controls segment revenues $ 9,820 $ 9,063 $ 29,000 $ 26,199

Employee benefit plans (Tables)

Employee benefit plans (Tables)	9 Months Ended
	Jul. 04, 2015
Employee benefit plans [Abstract]
Components of the net pension cost	The following table sets forth the components of the net pension cost for the three and nine month periods ended July 4, 2015 and June 28, 2014, respectively: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Interest cost $ 308 $ 330 $ 928 $ 973 Expected return on plan assets (311 ) (331 ) (937 ) (978 ) Amortization of net loss 66 57 198 170 Net periodic benefit cost 63 56 189 165 Net cost of defined contribution plans $ 87 $ 125 $ 359 $ 372 Net cost of all employee benefit plans $ 150 $ 181 $ 548 $ 537
Movement in liability for pension benefits	The following table sets forth the movement in the liability for pension benefits in the nine month periods ended July 4, 2015 and June 28, 2014, respectively: (in thousands of dollars) Nine Months ended July 4, 2015 June 28, 2014 Liability for pension benefits at beginning of period 9,529 8,354 Interest cost 928 973 Expected return on plan assets (937 ) (978 ) Plan contributions (497 ) (429 ) Effect of exchange rate changes (349 ) 400 Balance at end of period 8,674 8,320
Amounts recognized in balance sheet	Amounts recognized in the balance sheet consist of: (in thousands of dollars) July 4, 2015 September, 30, 2014 Non-current liabilities $ 8,674 $ 9,529
Amounts recognized in accumulated other comprehensive income	Amounts recognized in accumulated other comprehensive loss consist of: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Actuarial loss, net of $16 and $47 tax benefit for the three and nine month periods, respectively, (2014: net of $13 and $39 tax benefit for the three and nine month periods, respectively) $ 50 $ 44 $ 151 $ 131
Pension plan assets measured and recorded at fair value	The table below presents information about the Company’s pension plan assets measured and recorded at fair value as of July 4, 2015 and indicates the fair value hierarchy of the inputs utilized by the Company to determine the fair values. (in thousands of dollars) Level 1* (Quoted prices in active markets) Level 2** (Significant observable inputs) Level 3*** (Unobservable inputs) Mutual Funds Adept Strategy 9 Fund (a sub-fund of Adept Investment Management plc) 13,848 Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds (funds Managed by Schroder Investment Management Limited) 3,437 U.S. Equity Funds 376 U.S. Mutual Funds and Fixed Income Funds 2,672 Other Types of Investments 349 Cash Total 3,397 17,285 The table below presents information about the Company’s pension plan assets measured and recorded at fair value as of September 30, 2014: (in thousands of dollars) Level 1* (Quoted prices in active markets) Level 2** (Significant observable inputs) Level 3*** (Unobservable inputs) Mutual Funds Standard Life Pension Global Absolute Returns Strategies Fund 7,187 Standard Life UK Indexed Linked Fund 1,856 Standard Life Long Corporate Bond Fund 1,785 CF Ruffer Absolute Return Fund 7,177 U.S. Mutual Funds 2,431 U.S. Exchange Traded Funds 348 Other Types of Investments Cash 333 Total 21,117 * Level 1 inputs are quoted, unadjusted prices in active markets for identical assets or liabilities at the measurement date. The Company’s pension plan financial assets in U.S. Equity Funds, Mutual Funds and Fixed Income Funds are Level 1 assets ** Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The Company’s pension plan financial assets held in the Adept Strategy 9 Fund and the Schroder investments are Level 2 assets . The Company uses the Net Asset Value to determine the fair value of underlying investments which (a) do not have readily determinable fair value; and (b) prepare their financial statements consistent with the measurement principles of an investment company. The Funds are not exchange traded. The Funds are not subject to any redemption notice periods or restrictions and can be redeemed on a daily basis. No gates or holdbacks or dealing suspensions are being applied to the Funds. The Funds are of perpetual duration. *** Level 3 inputs are unobservable inputs for an asset or liability. The Company currently does not have any Level 3 pension plan financial assets.
Estimated future benefit payments	The following estimated benefit payments have been, or are expected, to be paid: (in thousands of dollars) 2015 $ 668 2016 707 2017 697 2018 695 2019 671 2020 – 2024 $ 3,658

Inventories (Tables)

Inventories (Tables)	9 Months Ended
	Jul. 04, 2015
Inventories [Abstract]
Inventories	(10) Inventories Inventories, net of reserve, were comprised of: (in thousands of dollars) July 4, 2015 September 30, 2014 Raw materials $ 3,698 $ 2,095 Work-in-process 90 102 Finished goods 2,808 4,061 $ 6,596 $ 6,258

Derivative financial instrume29

Derivative financial instruments (Tables)	9 Months Ended
	Jul. 04, 2015
Derivative financial instruments [Abstract]
Summary of the Company's derivative financial instruments	The following table presents the fair values of the Company’s derivative financial instruments for the following periods: (in thousands of dollars) July 4, 2015 September 30, 2014 Assets Liabilities Assets Liabilities Foreign currency contracts - 68 - -

Accrued expenses (Tables)

Accrued expenses (Tables)	9 Months Ended
	Jul. 04, 2015
Accrued expenses [Abstract]
Analysis of other accrued expenses	Set out below is an analysis of other accrued expenses at July 4, 2015 and September 30, 2014, which shows separately any items in excess of 5% of total current liabilities: (in thousands of dollars) July 4, 2015 September 30, 2014 Accrued compensation and related costs $ 886 $ 1,062 Other accrued expenses 1,082 774 $ 1,968 $ 1,836

Warranty reserves (Tables)

Warranty reserves (Tables)	9 Months Ended
	Jul. 04, 2015
Warranty reserves [Abstract]
Movement in warranty reserves	Warranty reserves are included on the balance sheet within accrued expenses; the movement in warranty reserves was as follows: (in thousands of dollars) Three Months ended Nine Months ended July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014 Warranty reserves at beginning of period $ 144 $ 140 $ 153 $ 138 Decrease in beginning balance for warranty obligations settled during the period - (5 ) - (49 ) Foreign currency translation adjustment 3 - (9 ) 2 Net increase in warranty reserves for products sold during the period and warranty expiration - 8 3 52 Warranty reserves at end of period $ 147 $ 143 $ 147 $ 143

Debt (Tables)

Debt (Tables)	9 Months Ended
	Jul. 04, 2015
Debt [Abstract]
Annual principal payments on long term debt	Annual principal payments on secured revolving credit facility at July 4, 2015 are as follows: (in thousands of dollars) 2017 $ 500 Total $ 500

Basis of presentation (Details)

Basis of presentation (Details) - Jul. 04, 2015	Total
Basis of presentation [Abstract]
Equity interest ownership (in hundredths)	50.00%
Joint venture ownership (in hundredths)	50.00%
Third party's equity interest ownership (in hundredths)	50.00%

Stock-based compensation plan34

Stock-based compensation plans (Details) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended				9 Months Ended
	Dec. 31, 2014USD ($)Employeeshares	Jul. 04, 2015USD ($)$ / sharesshares	Apr. 04, 2015shares	Jun. 28, 2014USD ($)shares	Mar. 29, 2014shares	Jul. 04, 2015USD ($)Employee$ / sharesshares	Jun. 28, 2014USD ($)shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options outstanding (in shares)		0		0		0	0
Options exercisable (in shares)		0		0		0	0
Weighted Average Grant-Date Fair Value [Roll Forward]
Stock based compensation expense | $		$ 147		$ 98		$ 406	$ 225
Unrecognized compensation expense | $		$ 923				$ 923
Weighted average period for unrecognized compensation expense to be recognized						2 years 3 months 18 days
Restricted Stock [Member]
Number of shares of Restricted Stock [Roll Forward]
Non-vested balance, beginning of period (in shares)						168,600
Granted (in shares)						92,600
Vested (in shares)						(64,600)
Non-vested balance, end of period (in shares)		196,600				196,600
Weighted Average Grant-Date Fair Value [Roll Forward]
Non-vested balance, beginning of period (in dollars per share) | $ / shares						$ 5.27
Granted (in dollars per share) | $ / shares						7.68
Vested (in dollars per share) | $ / shares						6.32
Non-vested balance, ending of period (in dollars per share) | $ / shares		$ 6.07				$ 6.07
Restricted Stock [Member] | Eight Employees [Member]
Number of shares of Restricted Stock [Roll Forward]
Granted (in shares)	42,000
Weighted Average Grant-Date Fair Value [Roll Forward]
Number of employees directors with restricted stock grant | Employee	8
Estimated fair value of stock at date of grant | $	$ 330
Period for recognition of unearned compensation	2 years
Charge to income for restricted stock | $							82
Quarterly charge to income for restricted stock | $							41
Restricted Stock [Member] | Three Employees [Member]
Number of shares of Restricted Stock [Roll Forward]
Granted (in shares)	20,000
Weighted Average Grant-Date Fair Value [Roll Forward]
Number of employees directors with restricted stock grant | Employee	3
Estimated fair value of stock at date of grant | $	$ 139
Period for recognition of unearned compensation	5 years
Charge to income for restricted stock | $							14
Quarterly charge to income for restricted stock | $							7
Restricted Stock [Member] | Nine Non-Employees [Member]
Number of shares of Restricted Stock [Roll Forward]
Granted (in shares)						30,600
Weighted Average Grant-Date Fair Value [Roll Forward]
Number of employees directors with restricted stock grant | Employee						9
Estimated fair value of stock at date of grant | $						$ 225
Period for recognition of unearned compensation						12 months
Charge to income for restricted stock | $							75
Quarterly charge to income for restricted stock | $							$ 56
1996 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares reserved and available for grant (in shares)		139,578		183,400		139,578	183,400
Options grants (in shares)			0		0	0	0
Options exercised (in shares)			0		0	0	0

Cash dividends (Details)

Cash dividends (Details) - USD ($)	9 Months Ended
	Jul. 04, 2015	Apr. 15, 2015	Oct. 15, 2014	Sep. 30, 2014
Preference share dividends [Abstract]
Preferred stock, outstanding (in shares)	452,374			460,769
Series A Convertible Preferred Stock, stated value (in dollars per share)	$ 0.10			$ 0.10
Series A Convertible Preferred Stock [Member]
Preference share dividends [Abstract]
Preferred stock, issued (in shares)	452,374
Preferred stock, outstanding (in shares)	452,374
Series A Convertible Preferred Stock, stated value (in dollars per share)	$ 24
Percentage of cumulative annual dividend, Series A Convertible Preferred Stock (in hundredths)	4.00%
Semi annual dividend		$ 221,000	$ 42,000
Dividend payable	Apr. 15, 2015
Next semi-annual dividend payable	Oct. 15, 2015

Calculation of earnings per s36

Calculation of earnings per share and weighted average shares outstanding (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014
Numerator:
Net income attributable to common stockholders for computing net income per ordinary share - basic	$ 171	$ 222	$ 881	$ 872
Dividend eliminated upon assumed conversion of convertible preference shares	0	0	335	0
Net income attributable to common stockholders for computing net income per ordinary share - diluted	$ 171	$ 222	$ 1,216	$ 872
Denominator :
Weighted average shares used in calculating net income per ordinary share - basic (in shares)	3,486,000	3,406,000	3,459,000	3,394,000
Adjustment for assumed conversion of convertible preference shares (in shares)	0	0	1,374,000	0
Adjustment for shares issuable upon vesting of restricted stock (in shares)	91,000	93,000	80,000	74,000
Weighted average shares used in calculating net income per ordinary share - diluted (in shares)	3,577,000	3,499,000	4,913,000	3,468,000
Net income per ordinary share - basic (in dollars per share)	$ 0.04	$ 0.07	$ 0.25	$ 0.26
Net income per ordinary share - diluted (in dollars per share)	$ 0.04	$ 0.06	$ 0.25	$ 0.25
No. of shares of convertible preference stock excluded during the period as such shares and related dividends would have the effect of increasing earnings per share (in shares)	1,357	0	0	0

Segment information (Details)

Segment information (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015USD ($)	Jun. 28, 2014USD ($)	Jul. 04, 2015USD ($)Segment	Jun. 28, 2014USD ($)
Segment information [Abstract]
Number of reportable segments | Segment			2
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	$ 10,346	$ 9,657	$ 30,619	$ 27,876
Operating income (loss)	261	213	1,217	1,119
Identifiable assets, excluding goodwill	32,431	24,033	32,431	24,033
Reportable Segments [Member] | Controls [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	9,820	9,063	29,000	26,199
Operating income (loss)	342	194	1,064	1,033
Identifiable assets, excluding goodwill	24,033	21,907	24,033	21,907
Reportable Segments [Member] | Capacitors [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	526	594	1,619	1,677
Operating income (loss)	5	108	121	252
Identifiable assets, excluding goodwill	1,248	1,462	1,248	1,462
Intersegment Eliminations [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	0	3	3	5
Intersegment Eliminations [Member] | Controls [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	0	0	0	0
Intersegment Eliminations [Member] | Capacitors [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	0	3	3	5
Corporate [Member]
Segment Reporting Information, Revenue for Reportable Segment [Abstract]
Sales to external customers	0	0	0	0
Operating income (loss)	(86)	(89)	32	(166)
Identifiable assets, excluding goodwill	$ 7,150	$ 664	$ 7,150	$ 664

Segment information, Revenues f

Segment information, Revenues from Electronic Controls Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014
Revenue from External Customer [Line Items]
Revenue from external customer	$ 10,346	$ 9,657	$ 30,619	$ 27,876
Reportable Segments [Member] | Controls [Member]
Revenue from External Customer [Line Items]
Revenue from external customer	9,820	9,063	29,000	26,199
Reportable Segments [Member] | Controls [Member] | Electronic controls for zero emission and hybrid electric vehicles [Member]
Revenue from External Customer [Line Items]
Revenue from external customer	7,445	6,591	19,746	19,730
Reportable Segments [Member] | Controls [Member] | Accessory and aftermarket products and services and engineering contracts [Member]
Revenue from External Customer [Line Items]
Revenue from external customer	$ 2,375	$ 2,472	$ 9,254	$ 6,469

Research and development (Detai

Research and development (Details) - USD ($) $ in Thousands	Jul. 31, 2013	Jul. 04, 2015	Jul. 04, 2015	Jun. 28, 2014
Cummins Generator Technologies and Newcastle University [Member]
Research and Development Arrangement, Contract to Perform for Others [Line Items]
Grant income recorded			$ 69	$ 61
Research and development expense on projects			245	180
Low Emission Transport Collaborative Projects Fund [Member]
Research and Development Arrangement, Contract to Perform for Others [Line Items]
Grant income recorded			53	339
Research and development expense on projects			450	$ 1,392
Total grants awarded	$ 480
U.K. Regional Growth Fund [Member]
Research and Development Arrangement, Contract to Perform for Others [Line Items]
Grant income recorded		$ 37	37
Research and development expense on projects		149	$ 149
Total grants awarded		$ 625

Employee benefit plans (Details

Employee benefit plans (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended
		Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014	Sep. 30, 2014
Components of net pension cost [Abstract]
Interest cost		$ 308	$ 330	$ 928	$ 973
Expected return on plan assets		(311)	(331)	(937)	(978)
Amortization of net loss		66	57	198	170
Net periodic benefit cost		63	56	189	165
Net cost of defined contribution plans		87	125	359	372
Net cost of all employee benefit plans		150	181	548	537
Movement in liability for pension benefits [Roll forward]
Liability for pension benefits at beginning of period				9,529	8,354
Interest cost		308	330	928	973
Expected return on plan assets		(311)	(331)	(937)	(978)
Plan contributions				(497)	(429)
Effect of exchange rate changes				(349)	400
Balance at end of period		8,674	8,320	8,674	8,320
Amounts recognized in balance sheet [Abstract]
Non-current liabilities		8,674		8,674		$ 9,529
Amounts recognized in accumulated other comprehensive loss [Abstract]
Actuarial loss, net of $16 and $47 tax benefit for the three and nine month periods, respectively, (2014: net of $13 and $39 tax benefit for the three and nine month periods, respectively)		50	44	151	131
Actuarial loss		16	$ 13	47	$ 39
Estimated future benefit payments [Abstract]
2,015		668		668
2,016		707		707
2,017		697		697
2,018		695		695
2,019		671		671
2020 - 2024		3,658		3,658
Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	3,397		3,397		21,117
Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	17,285		17,285		0
Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	0		0		0
Adept Strategy 9 Fund [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	0		0
Adept Strategy 9 Fund [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	13,848		13,848
Adept Strategy 9 Fund [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	0		0
Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	0		0
Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	3,437		3,437
Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	0		0
U.S. Equity Funds [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	376		376		2,431
U.S. Equity Funds [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	0		0		0
U.S. Equity Funds [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	0		0		0
U.S. Mutual Funds and Fixed Income Funds [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	2,672		2,672
U.S. Mutual Funds and Fixed Income Funds [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	0		0
U.S. Mutual Funds and Fixed Income Funds [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	0		0
Cash [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]	349		349		333
Cash [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]	0		0		0
Cash [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]	$ 0		0		0
Standard Life Pension Global Absolute Returns Strategies Fund [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]					7,187
Standard Life Pension Global Absolute Returns Strategies Fund [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]					0
Standard Life Pension Global Absolute Returns Strategies Fund [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]					0
Standard Life U.K. Indexed Linked Fund [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]					1,856
Standard Life U.K. Indexed Linked Fund [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]					0
Standard Life U.K. Indexed Linked Fund [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]					0
Standard Life Long Corporate Bond Fund [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]					1,785
Standard Life Long Corporate Bond Fund [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]					0
Standard Life Long Corporate Bond Fund [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]					0
CF Ruffer Absolute Return Fund [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]					7,177
CF Ruffer Absolute Return Fund [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]					0
CF Ruffer Absolute Return Fund [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]					0
U.S. Mutual Funds [Member] | Level 1 (Quoted prices in active markets) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[1]					348
U.S. Mutual Funds [Member] | Level 2 (Significant observable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[2]					0
U.S. Mutual Funds [Member] | Level 3 (Unobservable inputs) [Member]
Fair Value of Plan Assets [Abstract]
Fair value of plan assets	[3]					$ 0
U.S. Defined Benefit Plan [Member]
Estimated future employer contributions [Abstract]
Employer contributions				150
Estimated future employer contributions in current fiscal year				50
U.K. Defined Benefit Plan [Member]
Estimated future employer contributions [Abstract]
Employer contributions				347
Estimated future employer contributions in current fiscal year				$ 464
U.K. Defined Benefit Plan [Member] | Adept Strategy 9 Fund [Member]
Estimated future employer contributions [Abstract]
Defined benefit plan, actual plan asset allocations (in hundredths)		80.00%		80.00%
U.K. Defined Benefit Plan [Member] | Schroder Matching Plus Nominal and Index Linked Liability Driven Investment Swap Funds [Member]
Estimated future employer contributions [Abstract]
Defined benefit plan, actual plan asset allocations (in hundredths)		20.00%		20.00%
[1]	Level 1 inputs are quoted, unadjusted prices in active markets for identical assets or liabilities at the measurement date. The Company's pension plan financial assets in U.S. Equity Funds, Mutual Funds and Fixed Income Funds are Level 1 assets.
[2]	Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. The Company's pension plan financial assets held in the Adept Strategy 9 Fund and the Schroder investments are Level 2 assets. The Company uses the Net Asset Value to determine the fair value of underlying investments which a do not have readily determinable fair value; and b prepare their financial statements consistent with the measurement principles of an investment company. The Funds are not exchange traded. The Funds are not subject to any redemption notice periods or restrictions and can be redeemed on a daily basis. No gates or holdbacks or dealing suspensions are being applied to the Funds. The Funds are of perpetual duration.
[3]	Level 3 inputs are unobservable inputs for an asset or liability. The Company currently does not have any Level 3 pension plan financial assets.

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Jul. 04, 2015	Sep. 30, 2014
Inventories [Abstract]
Raw materials	$ 3,698	$ 2,095
Work-in-process	90	102
Finished goods	2,808	4,061
Inventories	$ 6,596	$ 6,258

Derivative financial instrume42

Derivative financial instruments (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014	Sep. 30, 2014
Derivatives, Fair Value [Line Items]
Net gain (loss)	$ 132	$ 0	$ (68)	$ 0
Foreign Exchange Contract [Member]
Derivatives, Fair Value [Line Items]
Outstanding forward contracts	2,009		2,009		$ 0
Net gain (loss)	132	$ 0	(68)	$ 0
Asset	0		0		0
Liability	$ 68		$ 68		$ 0

Accrued expenses (Details)

Accrued expenses (Details) - USD ($) $ in Thousands	Jul. 04, 2015	Sep. 30, 2014
Accrued expenses [Abstract]
Accrued compensation and related costs	$ 886	$ 1,062
Other accrued expenses	1,082	774
Accrued expenses	$ 1,968	$ 1,836
Percentage of total current liabilities used to analyze accrued expenses (in hundredths)	5.00%	5.00%

Warranty reserves (Details)

Warranty reserves (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jul. 04, 2015	Jun. 28, 2014	Jul. 04, 2015	Jun. 28, 2014
Movement in warranty reserves [Roll Forward]
Warranty reserves at beginning of period	$ 144	$ 140	$ 153	$ 138
Decrease in beginning balance for warranty obligations settled during the period	0	(5)	0	(49)
Foreign currency translation adjustment	3	0	(9)	2
Net increase in warranty reserves for products sold during the period and warranty expiration	0	8	3	52
Warranty reserves at end of period	$ 147	$ 143	$ 147	$ 143

Debt (Details)

Debt (Details) - USD ($) $ in Thousands	9 Months Ended
	Jul. 04, 2015	Sep. 30, 2014
Debt Instrument [Line Items]
Current portion of long term debt	$ 0	$ 28
Line of Credit Facility [Line Items]
Debt covenant description	Under the facility, Sevcon USA, Inc. must maintain, on a quarterly basis, a debt to tangible net worth ratio of no more than 2.40:1 and a debt service coverage ratio of no less than 1.25:1 for each rolling twelve-month period.
Total overdraft facility	$ 1,400
Secured Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of credit facility, amount outstanding	500	$ 1,700
Annual principal payments on long term debt [Abstract]
2,017	500
Total maturities	500
Secured Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Fair market value of the debt	500
Citizens Bank [Member] | Secured Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	$ 350
Margin interest rate (in hundredths)	3.125%
Line of credit facility, expiration date	Jun. 14, 2017

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($) $ in Thousands	Jul. 04, 2015	Sep. 30, 2014
Commitments and Contingencies [Abstract]
Maximum recorded liability of deferred annuities	$ 156	$ 162
Minimum rental commitments under non-cancelable leases [Abstract]
2,015	213
2,016	205
2,017	205
2,018	208
2,019	194
Thereafter	3,405
Total overdraft facility	1,400
Revolving credit facility	500	1,700
Outstanding amount on Overdraft facitilty	$ 0	$ 0