Fuel Tech (FTEK) 10-Q 8 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Oct. 31, 2016
Document and Entity Information [Abstract]
Entity Registrant Name	FUEL TECH, INC.
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		23,446,035
Amendment Flag	false
Entity Central Index Key	846,913
Entity Filer Category	Smaller Reporting Company
Document Period End Date	Sep. 30, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus (Q1,Q2,Q3,FY)	Q3

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 13,332	$ 21,684
Restricted cash	6,020	0
Marketable securities	15	19
Accounts receivable, net of allowance for doubtful accounts of $1,890 and $1,772, respectively	19,804	23,060
Inventories	992	1,653
Prepaid expenses and other current assets	2,473	3,889
Prepaid income taxes	733	1,857
Deferred income taxes	0	239
Total current assets	43,369	52,401
Property and equipment, net of accumulated depreciation of $24,172 and $23,414, respectively	10,889	12,001
Goodwill	2,116	2,116
Other intangible assets, net of accumulated amortization of $8,736 and $7,452, respectively	6,000	7,144
Deferred income taxes	1,198	992
Other assets	1,259	1,357
Total assets	64,831	76,011
Current liabilities:
Accounts payable	5,802	8,942
Accrued liabilities:
Employee compensation	1,879	1,645
Other accrued liabilities	4,341	5,949
Total current liabilities	12,022	16,536
Other liabilities	401	501
Total liabilities	12,423	17,037
Commitments and Contingencies
Shareholders’ equity:
Common stock, $.01 par value, 40,000,000 shares authorized, 23,800,924 and 23,419,008 shares issued, and 23,446,035, and 23,167,216 shares outstanding, respectively	238	234
Additional paid-in capital	136,909	135,394
Accumulated deficit	(82,416)	(74,132)
Accumulated other comprehensive loss	(1,185)	(1,556)
Nil coupon perpetual loan notes	76	76
Treasury stock, at cost	(1,214)	(1,042)
Total shareholders’ equity	52,408	58,974
Total liabilities and shareholders’ equity	$ 64,831	$ 76,011

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 1,687	$ 1,772
Accumulated depreciation	23,921	23,414
Accumulated amortization	$ 7,886	$ 7,452
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	40,000,000	40,000,000
Common stock, shares issued (in shares)	23,539,342	23,419,008
Common stock outstanding (in shares)	23,257,804	23,167,216

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Income Statement [Abstract]
Revenues	$ 12,596	$ 21,677	$ 45,593	$ 55,463
Costs and expenses:
Cost of sales	7,281	13,829	28,650	33,813
Selling, general and administrative	5,789	7,122	19,711	23,490
Restructuring charge	1,108	0	1,425	235
Research and development	1,302	1,521	3,582	3,375
Costs and expenses:	15,480	22,472	53,368	60,913
Operating (loss)	(2,884)	(795)	(7,775)	(5,450)
Interest expense	0	0	0	(30)
Interest income	5	3	21	17
Other expense	(254)	(100)	(738)	(261)
(Loss) before income taxes	(3,133)	(892)	(8,492)	(5,724)
Income tax benefit	114	603	208	2,410
Net (loss)	$ (3,019)	$ (289)	$ (8,284)	$ (3,314)
Net (loss) per common share:
Basic (in dollars per share)	$ (0.13)	$ (0.01)	$ (0.35)	$ (0.14)
Diluted (in dollars per share)	$ (0.13)	$ (0.01)	$ (0.35)	$ (0.14)
Weighted-average number of common shares outstanding:
Basic (in shares)	23,446	23,167	23,337	23,079
Diluted (in shares)	23,446	23,167	23,337	23,079

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Statement of Comprehensive Income [Abstract]
Net (loss)	$ (3,019)	$ (289)	$ (8,284)	$ (3,314)
Other comprehensive income (loss):
Foreign currency translation adjustments	57	(642)	375	(706)
Unrealized gains (losses) from marketable securities, net of tax	4	(3)	(4)	(3)
Total other comprehensive income (loss)	61	(645)	371	(709)
Comprehensive (loss)	$ (2,958)	$ (934)	$ (7,913)	$ (4,023)

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating Activities
Net (loss)	$ (8,284)	$ (3,314)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation	1,359	1,560
Amortization	1,285	1,607
Loss (Gain) on disposal of equipment	59	(26)
Provision for doubtful accounts, net of recoveries	151	(43)
Deferred income taxes	(11)	(834)
Stock-based compensation	1,520	1,320
Changes in operating assets and liabilities:
Accounts receivable	2,764	1,958
Inventories	654	(331)
Prepaid expenses, other current assets and other non-current assets	2,766	313
Accounts payable	(3,083)	896
Accrued liabilities and other non-current liabilities	(1,362)	(4,180)
Net cash (used in) operating activities	(2,182)	(1,074)
Investing Activities
Purchases of property, equipment and patents	(453)	(523)
Proceeds from the sale of equipment	2	26
Net cash (used in) investing activities	(451)	(497)
Financing Activities
Change in restricted cash	(6,020)	0
Payments on short-term borrowings	0	(1,623)
Treasury shares withheld	(172)	(252)
Net cash (used in) financing activities	(6,192)	(1,875)
Effect of exchange rate fluctuations on cash	473	(793)
Net decrease in cash and cash equivalents	(8,352)	(4,239)
Cash and cash equivalents at beginning of period	21,684	18,637
Cash and cash equivalents at end of period	$ 13,332	$ 14,398

General

General	9 Months Ended
	Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
General	Organization Fuel Tech, Inc. and subsidiaries ("Fuel Tech", the "Company", "we", "us" or "our") provides advanced engineered solutions for the optimization of combustion systems in utility and industrial applications. Our primary focus is on the worldwide marketing and sale of NO x reduction technologies as well as our FUEL CHEM program. The Company’s NO x reduction technologies reduce nitrogen oxide emissions from boilers, furnaces and other stationary combustion sources. Our FUEL CHEM program is based on proprietary TIFI ® Targeted In-Furnace™ Injection technology, in combination with advanced Computational Fluid Dynamics (CFD) and Chemical Kinetics Modeling (CKM) boiler modeling, in the unique application of specialty chemicals to improve the efficiency, reliability and environmental status of combustion units by controlling slagging, fouling, corrosion, opacity and other sulfur trioxide-related issues in the boiler. Our business is materially dependent on the continued existence and enforcement of air quality regulations, particularly in the United States. We have expended significant resources in the research and development of new technologies in building our proprietary portfolio of air pollution control, fuel and boiler treatment chemicals, computer modeling and advanced visualization technologies. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Exchange Act. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the statements for the periods presented. All significant intercompany transactions and balances have been eliminated. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016. For further information, refer to the audited consolidated financial statements and footnotes thereto included in Fuel Tech’s Annual Report on Form 10-K for the year ended December 31, 2015 as filed with the Securities and Exchange Commission. Reclassifications Certain reclassifications to prior year amounts have been made in the consolidated financial statements to conform to the current period presentation. In the third quarter of 2016, the Company concluded that it was appropriate to separately present restructuring charges in the Consolidated Statements of Operations. Accordingly, the corresponding reclassifications have also been made to the Consolidated Statements of Operations for the three and nine months ended September 30, 2015.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Restricted cash Restricted cash represents funds that are restricted to satisfy any amount borrowed against the Company's existing revolving credit facility (the Facility) with JPMorgan Chase Bank, N.A. The amount of restricted cash was reduced by $1,000 on July 31, 2016 and became unrestricted cash and cash equivalents. The remaining balance of restricted cash totaling $6,020 will remain through the Maturity Date of the Facility. Refer to Note 8 Debt Financing for further information on the Facility. Revenue Recognition Revenues from the sales of chemical products are recorded when title transfers, either at the point of shipment or at the point of destination, depending on the contract with the customer. Fuel Tech uses the percentage of completion method of accounting for equipment construction and license contracts that are sold within the Air Pollution Control technology segment. Under the percentage of completion method, revenues are recognized as work is performed based on the relationship between actual construction costs incurred and total estimated costs at completion. Construction costs include all direct costs such as materials, labor, and subcontracting costs, and indirect costs allocable to the particular contract such as indirect labor, tools and equipment, and supplies. Revisions in completion estimates and contract values are made in the period in which the facts giving rise to the revisions become known and can influence the timing of when revenues are recognized under the percentage of completion method of accounting. Such revisions have historically not had a material effect on the amount of revenue recognized. The completed contract method is used for certain contracts that are not long-term in nature or when reasonably dependable estimates of the percentage of completion cannot be made. When the completed contract method is used, revenue and costs are deferred until the contract is substantially complete, which usually occurs upon customer acceptance of the installed product. Provisions are made for estimated losses on uncompleted contracts in the period in which such losses are determined. Fuel Tech’s APC contracts are typically eight to sixteen months in length. A typical contract will have three or four critical operational measurements that, when achieved, serve as the basis for us to invoice the customer via progress billings. At a minimum, these measurements will include the generation of engineering drawings, the shipment of equipment and the completion of a system performance test. As part of most of its contractual APC project agreements, Fuel Tech will agree to customer-specific acceptance criteria that relate to the operational performance of the system that is being sold. These criteria are determined based on mathematical modeling that is performed by Fuel Tech personnel, which is based on operational inputs that are provided by the customer. The customer will warrant that these operational inputs are accurate as they are specified in the binding contractual agreement. Further, the customer is solely responsible for the accuracy of the operating condition information; typically all performance guarantees and equipment warranties granted by us are voidable if the operating condition information is inaccurate or is not met. Accounts receivable includes unbilled receivables, representing revenues recognized in excess of billings on uncompleted contracts under the percentage of completion method of accounting. At September 30, 2016 and December 31, 2015 , unbilled receivables were approximately $8,042 and $7,312 , respectively, and are included in accounts receivable on the consolidated balance sheets. Billings in excess of costs and estimated earnings on uncompleted contracts were $1,168 and $1,858 , at September 30, 2016 and December 31, 2015 , respectively, and are included in other accrued liabilities on the consolidated balance sheets. Fuel Tech has installed over 1,000 units with APC technology and normally provides performance guarantees to our customers based on the operating conditions for the project. As part of the project implementation process, we perform system start-up and optimization services that effectively serve as a test of actual project performance. We believe that this test, combined with the accuracy of the modeling that is performed, enables revenue to be recognized prior to the receipt of formal customer acceptance. Recently Adopted Accounting Pronouncements In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this Update require that deferred tax liabilities and assets be classified as non-current in a classified statement of financial position. Current accounting principles require an entity to separate deferred income tax liabilities and assets into current and non-current amounts in a classified statement of financial position. ASU 2015-17 is effective for interim and annual periods beginning after December 15, 2016. The Company elected to early adopt ASU 2015-17 prospectively for the interim period beginning in the second quarter of 2016; thus, the prior reporting period was not retrospectively adjusted. See Note 11, Income Taxes, for further discussion. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09 "Revenue from Contracts with Customers" (Topic 606). This new accounting guidance on revenue recognition provides for a single five-step model to be applied to all revenue contracts with customers. The new standard also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. In August 2015, the FASB approved a one-year deferral to January 1, 2018. Early adoption is permitted as of the original effective date. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the standard. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This new accounting guidance more clearly articulates the requirements for the measurement and disclosure of inventory. Topic 330, Inventory, currently requires an entity to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximately normal profit margin. This new accounting guidance requires the measurement of inventory at lower of cost and net realizable value. ASU 2015-11 will be effective for the Company beginning on January 1, 2017. The adoption of this guidance in not expected to have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The amendments in this Update increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 will be effective for the Company beginning on January 1, 2019. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the standard. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this Update simplify the income tax effects, minimum statutory tax withholding requirements and impact of forfeitures related to how share-based payments are accounted for and presented in the financial statements. ASU 2016-09 will be effective for the Company beginning on January 1, 2017. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the statement.

Restructuring Activities

Restructuring Activities	9 Months Ended
	Sep. 30, 2016
Restructuring and Related Activities [Abstract]
Restructuring Activities	Restructuring Activities In July 2016, the Company reduced its workforce to better align its organizational infrastructure to its revised operating plans. The Company recorded a charge of $1,108 in the third quarter of 2016 in connection with the workforce reduction. The charge consisted primarily of one-time severance payments and benefit continuation costs. In addition, the Company incurred restructuring charges of $317 for the three-months ended March 31, 2016 to further reduce its organizational infrastructure. Further, the Company incurred restructuring charges of $235 for the three-months ended June 30, 2015. The following is a reconciliation of the accrual for the workforce reduction that is included within the "Accrued Liabilities" line of the consolidated balance sheets for the three- and nine-months ending September 30, 2016 and 2015: Three Months Ended 2016 2015 Restructuring liability at June 30, $ — $ — Amounts expensed 1,108 — Amounts paid (616 ) — Restructuring liability at September 30, $ 492 $ — Nine Months Ended 2016 2015 Restructuring liability at January 1, $ — $ — Amounts expensed 1,425 235 Amounts paid (933 ) (235 ) Restructuring liability at September 30, $ 492 $ —

Accumulated Other Comprehensive

Accumulated Other Comprehensive Loss	9 Months Ended
	Sep. 30, 2016
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Accumulated Other Comprehensive Loss	Accumulated Other Comprehensive Loss The changes in accumulated other comprehensive loss by component were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Foreign currency translation Balance at beginning of period $ (1,250 ) $ (535 ) $ (1,568 ) $ (471 ) Other comprehensive loss: Foreign currency translation adjustments (1) 57 (642 ) 375 (706 ) Balance at end of period $ (1,193 ) $ (1,177 ) $ (1,193 ) $ (1,177 ) Available-for-sale marketable securities Balance at beginning of period $ 4 $ 23 $ 12 $ 23 Other comprehensive income: Net unrealized holding (loss) gain (2) 4 (3 ) (4 ) (3 ) Deferred income taxes (2) — — — — Total other comprehensive (loss) income 4 (3 ) (4 ) (3 ) Balance at end of period $ 8 $ 20 $ 8 $ 20 Total accumulated other comprehensive loss $ (1,185 ) $ (1,157 ) $ (1,185 ) $ (1,157 ) (1) In all periods presented, there were no tax impacts related to rate changes and no amounts were reclassified to earnings. (2) In all periods presented, there were no realized holding gains or losses and therefore no amounts were reclassified to earnings.

Treasury Stock

Treasury Stock	9 Months Ended
	Sep. 30, 2016
Equity [Abstract]
Treasury Stock	Treasury Stock Common stock held in treasury totaled 354,889 and 251,792 with a cost of $1,214 and $1,042 at September 30, 2016 and December 31, 2015 , respectively. These shares were withheld from employees to settle personal tax withholding obligations that arose as a result of restricted stock units that have vested since 2012.

Earnings per Share

Earnings per Share	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Earnings per Share	Earnings per Share Basic earnings per share excludes the dilutive effects of stock options, restricted stock units (RSUs), and the nil coupon non-redeemable convertible unsecured loan notes. Diluted earnings per share includes the dilutive effect of the nil coupon non-redeemable convertible unsecured loan notes, RSUs, and unexercised in-the-money stock options, except in periods of net loss where the effect of these instruments is anti-dilutive. Out-of-money stock options are excluded from diluted earnings per share because they are anti-dilutive. For the three and nine months ended September 30, 2016 and 2015, basic earnings per share is equal to diluted earnings per share because all outstanding stock awards and convertible loan notes are considered anti-dilutive during periods of net loss. The following table sets forth the weighted-average shares used in calculating the earnings per share for the three and nine month periods ended September 30, 2016 and 2015 . Three Months Ended Nine Months Ended 2016 2015 2016 2015 Basic weighted-average shares 23,446,000 23,167,000 23,337,000 23,079,000 Conversion of unsecured loan notes — — — — Unexercised options and unvested RSUs — — — — Diluted weighted-average shares 23,446,000 23,167,000 23,337,000 23,079,000 Fuel Tech had 2,076,000 and 2,264,000 weighted average equity awards outstanding at September 30, 2016 and 2015 , respectively, that were not dilutive for the purposes of inclusion in the calculation of diluted earnings per share but could potentially become dilutive in future periods.

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-Based Compensation	Stock-Based Compensation Under our stock-based employee compensation plan, referred to as the Fuel Tech, Inc. 2014 Long-Term Incentive Plan (Incentive Plan), awards may be granted to participants in the form of Non-Qualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units (“RSUs”), Performance Awards, Bonuses or other forms of share-based or non-share-based awards or combinations thereof. Participants in the Incentive Plan may be our directors, officers, employees, consultants or advisors (except consultants or advisors in capital-raising transactions) as the directors determine are key to the success of our business. There are a maximum of 4,400,676 shares that may be issued or reserved for awards to participants under the Incentive Plan. As of September 30, 2016 , Fuel Tech had 684,658 shares available for share-based awards under the 2014 Plan. Stock-based compensation is included in selling, general, and administrative costs in our Consolidated Statements of Operations. The components of stock-based compensation for the three and nine month periods ended September 30, 2016 and 2015 were as follows: Three Months Ended Nine Months Ended 2016 2015 2016 2015 Stock options and restricted stock units $ 479 $ 487 $ 1,520 $ 1,320 Tax benefit of stock-based compensation expense — (188 ) — (508 ) After-tax effect of stock-based compensation $ 479 $ 299 $ 1,520 $ 812 Stock Options Stock options granted to employees under the Incentive Plans have a 10 -year life and they vest as follows: 50% after the second anniversary of the award date, 25% after the third anniversary, and the final 25% after the fourth anniversary of the award date. Fuel Tech calculates stock compensation expense for employee option awards based on the grant date fair value of the award, less expected annual forfeitures, and recognizes expense on a straight-line basis over the four -year service period of the award. Stock options granted to members of our board of directors vest immediately. Stock compensation for these awards is based on the grant date fair value of the award and is recognized in expense immediately. Fuel Tech uses the Black-Scholes option pricing model to estimate the grant date fair value of employee stock options. The principal variable assumptions utilized in valuing options and the methodology for estimating such model inputs include: (1) risk-free interest rate – an estimate based on the yield of zero–coupon treasury securities with a maturity equal to the expected life of the option; (2) expected volatility – an estimate based on the historical volatility of Fuel Tech’s Common Stock for a period equal to the expected life of the option; and (3) expected life of the option – an estimate based on historical experience including the effect of employee terminations. Stock option activity for Fuel Tech’s Incentive Plans for the nine months ended September 30, 2016 was as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding on January 1, 2016 1,191,125 $ 10.48 Granted 81,000 1.58 Exercised — — Expired or forfeited (200,375 ) 16.39 Outstanding on September 30, 2016 1,071,750 $ 8.70 4.69 $ — Exercisable on September 30, 2016 1,071,750 $ 8.70 4.69 $ — As of September 30, 2016 , there was no unrecognized compensation cost related to non-vested stock options granted under the Incentive Plans. Restricted Stock Units Restricted stock units (RSUs) granted to employees vest over time based on continued service (typically vesting over a period between two and four years). Such time-vested RSUs are valued at the date of grant using the intrinsic value method based on the closing price of the Common Shares on the grant date. Compensation cost, adjusted for estimated forfeitures, is amortized on a straight-line basis over the requisite service period. In addition to the time vested RSUs described above, performance-based RSU agreements (the Agreements) are issued annually to our Executive Chairman; President/Chief Executive Officer; Senior Vice President, Fuel Conversion Marketing; Senior Vice President, Treasurer/Chief Financial Officer; and Senior Vice President, General Counsel and Corporate Secretary. The Agreements provide each participating executive the opportunity to earn three types of awards with each award type specifying a targeted number of RSUs that may be granted to each executive based on either the individual performance of the executive or our relative performance compared to a peer group, as determined by the award type. The Compensation Committee of our Board of Directors (the Committee) determines the extent to which, if any, RSUs will be granted based on the achievement of the applicable performance criteria specified in the Agreement. This determination will be made following the completion of the applicable performance period (each a Determination Date). Such performance based awards include the following: • The first type of award is based on individual performance during the respective calendar year as determined by the Committee based on performance criteria specified in the Agreement. These awards will vest over a three year period beginning on the Determination Date. We estimated the fair value of these performance-based RSU awards on the date of the Agreement using the trading price of the Company’s stock and our estimate of the probability that the specified performance criteria will be met. The fair value measurement and probability estimate will be re-measured each reporting date until the Determination Date, at which time the final award amount will be known. For these job performance-based awards, we amortize compensation costs over the requisite service period, adjusted for estimated forfeitures, for each separately vesting tranche of the award. • The second type of RSU award contains a targeted number of RSUs to be granted based on the Company’s revenue growth relative to a specified peer group during a period of two calendar years. These awards vest 67% on the second anniversary of the Agreement date and 33% on the third anniversary of the Agreement date. We estimated the fair value of these performance-based RSU awards on the Agreement date using the trading price of the Company’s stock on the date of determination and our estimate of the probability that the specified performance criteria will be met. For these revenue growth performance-based awards, we amortize compensation costs over the requisite service period, adjusted for estimated forfeitures, for each separately vesting tranche of the award. • The third type of RSU award contains a targeted number of RSUs to be granted based on the total shareholder return (TSR) of the Company’s common stock relative to a specified peer group during a period of two calendar years. These awards vest 67% on the second anniversary of the Agreement date and 33% on the third anniversary of the Agreement date. We estimated the fair value of these market-based RSU awards on the Agreement date using a Monte Carlo valuation methodology and amortize the fair value over the requisite service period for each separately vesting tranche of the award. The principal variable assumptions utilized in valuing these RSUs under this valuation methodology include the risk-free interest rate, stock volatility, and correlations between our stock price and the stock prices of a peer group of companies. At September 30, 2016 , there is $2,345 of unrecognized compensation costs related to restricted stock unit awards to be recognized over a weighted average period of 1.70 years. A summary of restricted stock unit activity for the nine months ended September 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested restricted stock units at January 1, 2016 1,204,883 $ 4.21 Granted 845,862 1.88 Forfeited (172,949 ) 4.58 Vested (381,916 ) 4.36 Unvested restricted stock units at September 30, 2016 1,495,880 $ 2.81 The fair value of restricted stock that vested during the nine month period ending September 30, 2016 was $644 . Deferred Directors Fees In addition to the Incentive Plans, Fuel Tech has a Deferred Compensation Plans for Directors (Deferred Plan). Under the terms of the Deferred Plan, Directors can elect to defer Directors’ fees for shares of Fuel Tech Common Stock that are issuable at a future date as defined in the agreement. In accordance with ASC 718, Fuel Tech accounts for these awards as equity awards. In the nine -month periods ended September 30, 2016 and 2015 , Fuel Tech recorded no stock-based compensation expense under the Deferred Plan.

Debt Financing

Debt Financing	9 Months Ended
	Sep. 30, 2016
Debt Disclosure [Abstract]
Debt Financing	Debt Financing On June 30, 2015, Fuel Tech amended its existing revolving credit facility (the Facility) with JPMorgan Chase Bank, N.A. (JPM Chase) to extend the maturity date through June 30, 2017. The total availability under the facility was $15,000 and contained a provision to increase the facility up to a total principal amount of $25,000 upon approval from JPM Chase. The Facility was unsecured, bears interest at a rate of LIBOR plus 300 basis points , and has the Company’s Italian subsidiary, Fuel Tech S.r.l., as a guarantor. Fuel Tech can use this Facility for cash advances and standby letters of credit. As of September 30, 2016 and December 31, 2015 , there were no outstanding borrowings on the credit facility. The Facility contained several debt covenants with which the Company must comply on a quarterly or annual basis. The Facility required a minimum trailing-twelve month EBITDA of $500 for the quarters ending March 31, 2016 and June 30, 2016; Beginning with the fiscal quarter ended September 30, 2016, the Facility required a minimum EBITDA for the trailing twelve-month period then ended of not less than $1,000 . EBITDA includes after tax earnings with add backs for interest expense, income taxes, depreciation and amortization, stock-based compensation expense, and other non-cash items. This covenant was waived by our bank through the period ending December 31, 2015. In addition, the Facility required a minimum working capital requirement of $35,000 , starting as of December 31, 2015. Finally, the Facility had an annual capital expenditure limit of $5,000 . On May 9, 2016, the Company amended its existing U.S. Domestic credit facility with JPM Chase such that the financial covenants as set forth in the credit agreement would not be measured for the period ending as of March 31, 2016, and were removed in their entirety from the Facility. The credit availability under the Facility has been reduced from $15,000 to $7,000 with this amendment, and further, JPM Chase's then current Revolving Commitment under the Facility is now secured by cash held by the Company in a separate restricted use designated JPM Chase deposit account. The amount of credit available to the Company under the Facility was $7,000 from the date of the effective date of the amended facility through May 31, 2016, at which time the credit available to the Company under the Facility was reduced to $6,000 from June 1, 2016 through July 31, 2016, at which time the credit available to the Company under the Facility was reduced to $5,000 and will remain as such until the Maturity Date of the Facility on June 30, 2017. The Company intends to renew the U.S. Domestic credit facility at its maturity. During the entire period of the Facility the Company must maintain sufficient cash balances in a segregated deposit account equal to the amount of the Facility and will fully pledge such cash as collateral to the bank to support the credit available to the Company under the Facility. At September 30, 2016 and December 31, 2015 , the Company had outstanding standby letters of credit and bank guarantees totaling approximately $3,316 and $7,803 , respectively, under the Facility in connection with contracts in process. Fuel Tech is committed to reimbursing the issuing bank for any payments made by the bank under these instruments. At September 30, 2016 and December 31, 2015 , there were no cash borrowings under the domestic revolving credit facility. The Company pays a commitment fee of 0.25% per year on the unused portion of the revolving credit facility. At September 30, 2016 and December 31, 2015, approximately $2,684 and $7,197 was available for future borrowings under the Facility. On June 24, 2016, Beijing Fuel Tech Environmental Technologies Company, Ltd. (Beijing Fuel Tech), a wholly-owned subsidiary of Fuel Tech, entered into a new revolving credit facility (the China Facility) agreement with JPM Chase for RMB 6.5 million (approximately $975 ), which expires on June 23, 2017. The Company intends to renew the China Facility at its maturity. This new credit facility replaced the previous RMB 35 million facility that expired on June 24, 2016. The facility is unsecured, bears interest at a rate of 125% of the People’s Bank of China (PBOC) Base Rate, and is guaranteed by Fuel Tech. Beijing Fuel Tech can use this facility for cash advances and bank guarantees. As of September 30, 2016 and December 31, 2015, Beijing Fuel Tech had no cash borrowings under the China Facility. At September 30, 2016 and December 31, 2015 , the Company had outstanding standby letters of credit and bank guarantees totaling approximately $179 and $57 , respectively, on its Beijing Fuel Tech revolving credit facility in connection with contracts in process. At September 30, 2016 and December 31, 2015 , approximately $796 and $5,335 was available for future borrowings. In the event of default on either the domestic facility or the China facility, the cross default feature in each allows the lending bank to accelerate the payments of any amounts outstanding and may, under certain circumstances, allow the bank to cancel the facility. If the Company were unable to obtain a waiver for a breach of covenant and the bank accelerated the payment of any outstanding amounts, such acceleration may cause the Company’s cash position to deteriorate or, if cash on hand were insufficient to satisfy the payment due, may require the Company to obtain alternate financing to satisfy the accelerated payment. Interest payments in the amount of $0 and $30 were made during the nine -month periods ended September 30, 2016 and 2015 , and $0 for the three-month periods then ended.

Business Segment and Geographic

Business Segment and Geographic Financial Data	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Business Segment and Geographic Financial Data	Business Segment and Geographic Financial Data Business Segment Financial Data We segregate our financial results into three reportable segments representing three broad technology segments as follows: • The Air Pollution Control technology segment includes technologies to reduce NO x emissions in flue gas from boilers, incinerators, furnaces and other stationary combustion sources. These include Low and Ultra Low NO x Burners (LNB and ULNB), Over-Fire Air (OFA) systems, NO x OUT ® and HERT™ Selective Non-Catalytic Reduction (SNCR) systems, and Advanced Selective Catalytic Reduction (ASCR ™ ) systems. Our ASCR systems include ULNB, OFA, and SNCR components, along with a downsized SCR catalyst, Ammonia Injection Grid (AIG), and Graduated Straightening Grid GSG™ systems to provide high NO x reductions at significantly lower capital and operating costs than conventional SCR systems. The NO x OUT CASCADE ® and NO x OUT-SCR ® processes are more basic, using just SNCR and SCR catalyst components. ULTRA™ technology creates ammonia at a plant site using safe urea for use with any SCR application. Flue Gas Conditioning systems are chemical injection systems offered in markets outside the U.S. and Canada to enhance electrostatic precipitator and fabric filter performance in controlling particulate emissions. • The FUEL CHEM ® technology segment, which uses chemical processes in combination with advanced CFD and CKM boiler modeling, for the control of slagging, fouling, corrosion, opacity and other sulfur trioxide-related issues in furnaces and boilers through the addition of chemicals into the furnace using TIFI ® Targeted In-Furnace Injection™ technology. • The Fuel Conversion segment represents a new business initiative we commenced in 2014. We acquired intellectual property rights and know-how related to the CARBONITE® fuel conversion process and technology. This process can convert coals of various grades into value-added products that are high in energy content, carbon-rich and less pollutive. This technology has a number of potential applications including certain coal replacement, electric arc furnace (EAF) reductant, ferro-alloy feedstock, absorbent and Hg reduced carbon stock. During 2015 and 2016, we have been testing and developing the engineered carbon products for specific markets. We are in the process of evaluating the commercialization of these product offerings with prospective customers and considering alternatives. We have earned no significant revenue other than for test products from perspective customers for the nine -month period ended September 30, 2016 and 2015 . The “Other” classification includes those profit and loss items not allocated to either reportable segment. There are no inter-segment sales that require elimination. We evaluate performance and allocates resources based on reviewing gross margin by reportable segment. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies (Note 1 in our annual report on Form 10-K). We do not review assets by reportable segment, but rather, in aggregate for the Company as a whole. Information about reporting segment net sales and gross margin are provided below: Three months ended September 30, 2016 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 6,042 $ 6,554 $ — $ — $ 12,596 Cost of sales (4,233 ) (3,048 ) — — (7,281 ) Gross margin 1,809 3,506 — — 5,315 Selling, general and administrative — — — (5,789 ) (5,789 ) Restructuring charge (373 ) (735 ) — — (1,108 ) Research and development — — (630 ) (672 ) (1,302 ) Operating income (loss) $ 1,436 $ 2,771 $ (630 ) $ (6,461 ) $ (2,884 ) Three months ended September 30, 2015 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 13,078 $ 8,599 $ — $ — $ 21,677 Cost of sales (10,021 ) (3,808 ) — — (13,829 ) Gross margin 3,057 4,791 — — 7,848 Selling, general and administrative — — — (7,122 ) (7,122 ) Restructuring charge — — — — — Research and development — — (1,111 ) (410 ) (1,521 ) Operating income (loss) $ 3,057 $ 4,791 $ (1,111 ) $ (7,532 ) $ (795 ) Nine months ended September 30, 2016 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 29,063 $ 16,530 $ — $ — $ 45,593 Cost of sales (20,704 ) (7,946 ) — — (28,650 ) Gross margin 8,359 8,584 — — 16,943 Selling, general and administrative — — — (19,711 ) (19,711 ) Restructuring charge (537 ) (888 ) — — (1,425 ) Research and development — — (2,144 ) (1,438 ) (3,582 ) Operating income (loss) $ 7,822 $ 7,696 $ (2,144 ) $ (21,149 ) $ (7,775 ) Nine months ended September 30, 2015 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 31,022 $ 24,441 $ — $ — $ 55,463 Cost of sales (22,111 ) (11,702 ) — — (33,813 ) Gross margin 8,911 12,739 — — 21,650 Selling, general and administrative — — — (23,490 ) (23,490 ) Restructuring charge (179 ) (56 ) — — (235 ) Research and development — — (2,212 ) (1,163 ) (3,375 ) Operating income (loss) $ 8,732 $ 12,683 $ (2,212 ) $ (24,653 ) $ (5,450 ) Geographic Segment Financial Data Information concerning our operations by geographic area is provided below. Revenues are attributed to countries based on the location of the customer. Assets are those directly associated with operations of the geographic area. Three Months Ended Nine Months Ended 2016 2015 2016 2015 Revenues: United States $ 9,838 $ 13,665 $ 36,523 $ 38,141 Foreign 2,758 8,012 9,070 17,322 $ 12,596 $ 21,677 $ 45,593 $ 55,463 September 30, December 31, Assets: United States $ 42,938 $ 47,437 Foreign 21,893 28,574 $ 64,831 $ 76,011

Contingencies

Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Contingencies Fuel Tech is subject to various claims and contingencies related to, among other things, workers compensation, general liability (including product liability), and lawsuits. The Company records liabilities where a contingent loss is probable and can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. The Company discloses a contingent liability even if the liability is not probable or the amount is not estimable, or both, if there is a reasonable possibility that a material loss may have been incurred. During the second quarter of 2016, the Company received a notice from a contractor that performed installation work on one of the Company's APC projects regarding $3.9 million in purported expenses beyond the contractually agreed cap on expenses. We believe that the claims alleged with regards to the additional expenses are without merit, and we intend to vigorously defend against them. The Company did not accrue an amount as of September 30, 2016 related to the alleged claims. As of September 30, 2016, the Company initiated the process, as required by the Company's contract with the subcontractor, to submit the dispute into mediation. If the parties are not able to agree upon terms within the mediation phase, the Company would seek resolution to the matter in court. A future adverse ruling or settlement could result in charges that could have a material adverse effect on the company's consolidated balance sheet, results of operations or cash flows in the period in which they are recorded. Fuel Tech issues a standard product warranty with the sale of its products to customers. Our recognition of warranty liability is based primarily on analyses of warranty claims experienced in the preceding years as the nature of our historical product sales for which we offer a warranty are substantially unchanged. This approach provides an aggregate warranty accrual that is historically aligned with actual warranty claims experienced. Changes in the warranty liability for the nine months September 30, 2016 and 2015 , are summarized below: Nine Months Ended 2016 2015 Aggregate product warranty liability at beginning of period $ 268 $ 268 Net aggregate expense (benefit) related to product warranties (109 ) 8 Aggregate reductions for payments — (8 ) Aggregate product warranty liability at end of period $ 159 $ 268

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2016
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company’s effective tax rate is 2% and 42% for the nine-month periods ended September 30, 2016 and 2015 , respectively. The Company's effective tax rate differs from the statutory federal tax rate of 34% for the nine-month period ended September 30, 2016 primarily due to a full valuation allowance recorded on our United States deferred tax assets since we cannot anticipate when or if we will have sufficient taxable income to utilize the deferred tax assets in the future. Further, our effective tax rate differs from the statutory federal tax rate due to state taxes, differences between U.S. and foreign tax rates, foreign losses incurred with no related tax benefit, non-deductible commissions, and non-deductible meals and entertainment expenses for the three-month periods ended September 30, 2016 and 2015 , respectively. Fuel Tech had unrecognized tax benefits of $37 and $140 as of September 30, 2016 and December 31, 2015 respectively, all of which, if ultimately recognized, will reduce Fuel Tech's annual effective tax rate. Effective beginning April 1, 2016, Fuel Tech prospectively adopted ASU 2015-17, "Balance Sheet Classification of Deferred Taxes" and as a result classified all deferred tax assets and liabilities as non-current.

Goodwill and Other Intangibles

Goodwill and Other Intangibles	9 Months Ended
	Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Other Intangibles	Goodwill and Other Intangibles Goodwill is allocated among and evaluated for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment. Fuel Tech has two reporting units for goodwill evaluation purposes: the FUEL CHEM ® technology segment and the APC technology segment. There is no goodwill associated with our APC or Fuel Conversion segments. At both September 30, 2016 and December 31, 2015 , our entire goodwill balance of $2,116 was allocated to the FUEL CHEM ® technology segment. Goodwill is allocated to each of our reporting units after considering the nature of the net assets giving rise to the goodwill and how each reporting unit would enjoy the benefits and synergies of the net assets acquired. There were no indications of goodwill impairment in the three and nine months ended September 30, 2016 and 2015 . Fuel Tech reviews other intangible assets, which include customer lists and relationships, covenants not to compete, patent assets, tradenames, and acquired technologies, for impairment on a recurring basis or when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In the event that impairment indicators exist, a further analysis is performed and if the sum of the expected undiscounted future cash flows resulting from the use of the asset is less than the carrying amount of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Management considers historical experience and all available information at the time the estimates of future cash flows are made, however, the actual cash values that could be realized may differ from those that are estimated. There were no indications of intangible asset impairment in the three and nine -month periods ended September 30, 2016 and 2015 .

General (Policies)

General (Policies)	9 Months Ended
	Sep. 30, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Exchange Act. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the statements for the periods presented. All significant intercompany transactions and balances have been eliminated. The results of operations for the three and nine months ended September 30, 2016 are not necessarily indicative of the results to be expected for the full year ending December 31, 2016. For further information, refer to the audited consolidated financial statements and footnotes thereto included in Fuel Tech’s Annual Report on Form 10-K for the year ended December 31, 2015 as filed with the Securities and Exchange Commission.

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Accounting Policies [Abstract]
Revenue Recognition Policy	Revenues from the sales of chemical products are recorded when title transfers, either at the point of shipment or at the point of destination, depending on the contract with the customer. Fuel Tech uses the percentage of completion method of accounting for equipment construction and license contracts that are sold within the Air Pollution Control technology segment. Under the percentage of completion method, revenues are recognized as work is performed based on the relationship between actual construction costs incurred and total estimated costs at completion. Construction costs include all direct costs such as materials, labor, and subcontracting costs, and indirect costs allocable to the particular contract such as indirect labor, tools and equipment, and supplies. Revisions in completion estimates and contract values are made in the period in which the facts giving rise to the revisions become known and can influence the timing of when revenues are recognized under the percentage of completion method of accounting. Such revisions have historically not had a material effect on the amount of revenue recognized. The completed contract method is used for certain contracts that are not long-term in nature or when reasonably dependable estimates of the percentage of completion cannot be made. When the completed contract method is used, revenue and costs are deferred until the contract is substantially complete, which usually occurs upon customer acceptance of the installed product. Provisions are made for estimated losses on uncompleted contracts in the period in which such losses are determined. A typical contract will have three or four critical operational measurements that, when achieved, serve as the basis for us to invoice the customer via progress billings. At a minimum, these measurements will include the generation of engineering drawings, the shipment of equipment and the completion of a system performance test. As part of most of its contractual APC project agreements, Fuel Tech will agree to customer-specific acceptance criteria that relate to the operational performance of the system that is being sold. These criteria are determined based on mathematical modeling that is performed by Fuel Tech personnel, which is based on operational inputs that are provided by the customer. The customer will warrant that these operational inputs are accurate as they are specified in the binding contractual agreement. Further, the customer is solely responsible for the accuracy of the operating condition information; typically all performance guarantees and equipment warranties granted by us are voidable if the operating condition information is inaccurate or is not met. Accounts receivable includes unbilled receivables, representing revenues recognized in excess of billings on uncompleted contracts under the percentage of completion method of accounting.
New Accounting Pronouncements	In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. The amendments in this Update require that deferred tax liabilities and assets be classified as non-current in a classified statement of financial position. Current accounting principles require an entity to separate deferred income tax liabilities and assets into current and non-current amounts in a classified statement of financial position. ASU 2015-17 is effective for interim and annual periods beginning after December 15, 2016. The Company elected to early adopt ASU 2015-17 prospectively for the interim period beginning in the second quarter of 2016; thus, the prior reporting period was not retrospectively adjusted. See Note 11, Income Taxes, for further discussion. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09 "Revenue from Contracts with Customers" (Topic 606). This new accounting guidance on revenue recognition provides for a single five-step model to be applied to all revenue contracts with customers. The new standard also requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. In August 2015, the FASB approved a one-year deferral to January 1, 2018. Early adoption is permitted as of the original effective date. The standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the standard. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory. This new accounting guidance more clearly articulates the requirements for the measurement and disclosure of inventory. Topic 330, Inventory, currently requires an entity to measure inventory at the lower of cost or market. Market could be replacement cost, net realizable value, or net realizable value less an approximately normal profit margin. This new accounting guidance requires the measurement of inventory at lower of cost and net realizable value. ASU 2015-11 will be effective for the Company beginning on January 1, 2017. The adoption of this guidance in not expected to have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The amendments in this Update increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. ASU 2016-02 will be effective for the Company beginning on January 1, 2019. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the standard. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The amendments in this Update simplify the income tax effects, minimum statutory tax withholding requirements and impact of forfeitures related to how share-based payments are accounted for and presented in the financial statements. ASU 2016-09 will be effective for the Company beginning on January 1, 2017. We are currently evaluating the impact of the new guidance on our financial statements and have not yet selected a transition approach to implement the statement.

Restructuring Activities (Table

Restructuring Activities (Tables)	9 Months Ended
	Sep. 30, 2016
Restructuring and Related Activities [Abstract]
Reconciliation of restructuring accrual	The following is a reconciliation of the accrual for the workforce reduction that is included within the "Accrued Liabilities" line of the consolidated balance sheets for the three- and nine-months ending September 30, 2016 and 2015: Three Months Ended 2016 2015 Restructuring liability at June 30, $ — $ — Amounts expensed 1,108 — Amounts paid (616 ) — Restructuring liability at September 30, $ 492 $ — Nine Months Ended 2016 2015 Restructuring liability at January 1, $ — $ — Amounts expensed 1,425 235 Amounts paid (933 ) (235 ) Restructuring liability at September 30, $ 492 $ —

Accumulated Other Comprehensi22

Accumulated Other Comprehensive Loss (Tables)	9 Months Ended
	Sep. 30, 2016
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Schedule of Accumulated Other Comprehensive Income (Loss)	The changes in accumulated other comprehensive loss by component were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Foreign currency translation Balance at beginning of period $ (1,250 ) $ (535 ) $ (1,568 ) $ (471 ) Other comprehensive loss: Foreign currency translation adjustments (1) 57 (642 ) 375 (706 ) Balance at end of period $ (1,193 ) $ (1,177 ) $ (1,193 ) $ (1,177 ) Available-for-sale marketable securities Balance at beginning of period $ 4 $ 23 $ 12 $ 23 Other comprehensive income: Net unrealized holding (loss) gain (2) 4 (3 ) (4 ) (3 ) Deferred income taxes (2) — — — — Total other comprehensive (loss) income 4 (3 ) (4 ) (3 ) Balance at end of period $ 8 $ 20 $ 8 $ 20 Total accumulated other comprehensive loss $ (1,185 ) $ (1,157 ) $ (1,185 ) $ (1,157 ) (1) In all periods presented, there were no tax impacts related to rate changes and no amounts were reclassified to earnings. (2) In all periods presented, there were no realized holding gains or losses and therefore no amounts were reclassified to earnings.

Earnings per Share (Tables)

Earnings per Share (Tables)	9 Months Ended
	Sep. 30, 2016
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The following table sets forth the weighted-average shares used in calculating the earnings per share for the three and nine month periods ended September 30, 2016 and 2015 . Three Months Ended Nine Months Ended 2016 2015 2016 2015 Basic weighted-average shares 23,446,000 23,167,000 23,337,000 23,079,000 Conversion of unsecured loan notes — — — — Unexercised options and unvested RSUs — — — — Diluted weighted-average shares 23,446,000 23,167,000 23,337,000 23,079,000

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs	The components of stock-based compensation for the three and nine month periods ended September 30, 2016 and 2015 were as follows: Three Months Ended Nine Months Ended 2016 2015 2016 2015 Stock options and restricted stock units $ 479 $ 487 $ 1,520 $ 1,320 Tax benefit of stock-based compensation expense — (188 ) — (508 ) After-tax effect of stock-based compensation $ 479 $ 299 $ 1,520 $ 812
Schedule of Share-based Compensation, Stock Options, Activity	Stock option activity for Fuel Tech’s Incentive Plans for the nine months ended September 30, 2016 was as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding on January 1, 2016 1,191,125 $ 10.48 Granted 81,000 1.58 Exercised — — Expired or forfeited (200,375 ) 16.39 Outstanding on September 30, 2016 1,071,750 $ 8.70 4.69 $ — Exercisable on September 30, 2016 1,071,750 $ 8.70 4.69 $ —
Schedule of Nonvested Restricted Stock Units Activity	A summary of restricted stock unit activity for the nine months ended September 30, 2016 is as follows: Shares Weighted Average Grant Date Fair Value Unvested restricted stock units at January 1, 2016 1,204,883 $ 4.21 Granted 845,862 1.88 Forfeited (172,949 ) 4.58 Vested (381,916 ) 4.36 Unvested restricted stock units at September 30, 2016 1,495,880 $ 2.81

Business Segment and Geograph25

Business Segment and Geographic Financial Data (Tables)	9 Months Ended
	Sep. 30, 2016
Segment Reporting [Abstract]
Schedule of Segment Reporting Information, by Segment	Information about reporting segment net sales and gross margin are provided below: Three months ended September 30, 2016 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 6,042 $ 6,554 $ — $ — $ 12,596 Cost of sales (4,233 ) (3,048 ) — — (7,281 ) Gross margin 1,809 3,506 — — 5,315 Selling, general and administrative — — — (5,789 ) (5,789 ) Restructuring charge (373 ) (735 ) — — (1,108 ) Research and development — — (630 ) (672 ) (1,302 ) Operating income (loss) $ 1,436 $ 2,771 $ (630 ) $ (6,461 ) $ (2,884 ) Three months ended September 30, 2015 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 13,078 $ 8,599 $ — $ — $ 21,677 Cost of sales (10,021 ) (3,808 ) — — (13,829 ) Gross margin 3,057 4,791 — — 7,848 Selling, general and administrative — — — (7,122 ) (7,122 ) Restructuring charge — — — — — Research and development — — (1,111 ) (410 ) (1,521 ) Operating income (loss) $ 3,057 $ 4,791 $ (1,111 ) $ (7,532 ) $ (795 ) Nine months ended September 30, 2016 Air Pollution Control Segment FUEL CHEM Segment Fuel Conversion Segment Other Total Revenues from external customers $ 29,063 $ 16,530 $ — $ — $ 45,593 Cost of sales (20,704 ) (7,946 ) — — (28,650 ) Gross margin 8,359 8,584 — — 16,943 Selling, general and administrative — — — (19,711 ) (19,711 ) Restructuring charge (537 ) (888 ) — — (1,425 ) Research and development — — (2,144 ) (1,438 ) (3,582 ) Operating income (loss) $ 7,822 $ 7,696 $ (2,144 ) $ (21,149 ) $ (7,775 )
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area	Information concerning our operations by geographic area is provided below. Revenues are attributed to countries based on the location of the customer. Assets are those directly associated with operations of the geographic area. Three Months Ended Nine Months Ended 2016 2015 2016 2015 Revenues: United States $ 9,838 $ 13,665 $ 36,523 $ 38,141 Foreign 2,758 8,012 9,070 17,322 $ 12,596 $ 21,677 $ 45,593 $ 55,463
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country	September 30, December 31, Assets: United States $ 42,938 $ 47,437 Foreign 21,893 28,574 $ 64,831 $ 76,011

Contingencies (Tables)

Contingencies (Tables)	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
Schedule of Product Warranty Liability	Changes in the warranty liability for the nine months September 30, 2016 and 2015 , are summarized below: Nine Months Ended 2016 2015 Aggregate product warranty liability at beginning of period $ 268 $ 268 Net aggregate expense (benefit) related to product warranties (109 ) 8 Aggregate reductions for payments — (8 ) Aggregate product warranty liability at end of period $ 159 $ 268

Summary of Significant Accoun27

Summary of Significant Accounting Policies (Detail) $ in Thousands	Jul. 31, 2016USD ($)	Sep. 30, 2016USD ($)contractmeasurementunit	Dec. 31, 2015USD ($)contract
Decrease in Restricted Cash	$ 1,000
Number of contracts in progress that were identified as a loss contract (in contracts) | contract		2	2
Loss on contract termination		$ 3	$ 3
Unbilled receivables, current		8,042	7,312
Billings in excess of cost, current		$ 1,168	$ 1,858
Number of units with APC technology (in units) | unit		1,000
Minimum
Contract term (in months)		8 months
Critical operational measurements (in measurements) | measurement		3
Maximum
Contract term (in months)		16 months
Critical operational measurements (in measurements) | measurement		4

Restructuring Activities (Detai

Restructuring Activities (Details) - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016	Mar. 31, 2016	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Restructuring Reserve [Roll Forward]
Restructuring liability, beginning balance	$ 0	$ 0	$ 0		$ 0	$ 0
Amounts expensed	1,108	$ 317	0	$ 235	1,425	235
Amounts paid	(616)		0		(933)	(235)
Restructuring liability, ending balance	$ 492		$ 0	$ 0	$ 492	$ 0

Accumulated Other Comprehensi29

Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Increase (Decrease) in Accumulated Other Comprehensive Loss [Roll Forward]
Balance at beginning of period			$ 58,974
Balance at end of period	$ 52,408		52,408
Foreign currency translation
Increase (Decrease) in Accumulated Other Comprehensive Loss [Roll Forward]
Balance at beginning of period	(1,250)	$ (535)	(1,568)	$ (471)
Total other comprehensive (loss) income	57	(642)	375	(706)
Balance at end of period	(1,193)	(1,177)	(1,193)	(1,177)
Available-for-sale marketable securities
Increase (Decrease) in Accumulated Other Comprehensive Loss [Roll Forward]
Balance at beginning of period	4	23	12	23
Other comprehensive (loss) income	4	(3)	(4)	(3)
Deferred income taxes	0	0	0	0
Total other comprehensive (loss) income	4	(3)	(4)	(3)
Balance at end of period	8	20	8	20
Total accumulated other comprehensive loss
Increase (Decrease) in Accumulated Other Comprehensive Loss [Roll Forward]
Balance at end of period	$ (1,185)	$ (1,157)	$ (1,185)	$ (1,157)

Treasury Stock (Detail)

Treasury Stock (Detail) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Equity [Abstract]
Treasury stock (in shares)	354,889	251,792
Cost of common stock held in treasury	$ 1,214	$ 1,042

Earnings per Share (Detail) - B

Earnings per Share (Detail) - Basic Earnings Per Share - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Earnings Per Share [Abstract]
Basic weighted-average shares (in shares)	23,446	23,167	23,337	23,079
Conversion of unsecured loan notes (in shares)	0	0	0	0
Unexercised options and unvested RSUs (in shares)	0	0	0	0
Diluted weighted-average shares (in shares)	23,446	23,167	23,337	23,079

Earnings per Share (Detail)

Earnings per Share (Detail) - shares shares in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Earnings Per Share [Abstract]
Antidilutive securities excluded from computation of earnings per share (in shares)	2,076	2,264

Stock-Based Compensation (Detai

Stock-Based Compensation (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2016USD ($)shares
Stock Options
Award vesting period	10 years
Award service period (in years)	4 years
Restricted Stock Units (RSUs)
Award vesting period	3 years
Unrecognized compensation cost | $	$ 2,345
Unrecognized compensation cost, period of recognition (in years)	1 year 255 days
Restricted Stock
Fair value of stock vested | $	$ 644
2014 Plan
Number of shares originally reserved | shares	4,400,676
Number of shares available for grant | shares	684,658
Second Anniversary of Award Date | Stock Options
Percent of options vesting	50.00%
Second Anniversary of Award Date | Restricted Stock Units (RSUs)
Percentage of restricted stock units vesting	67.00%
Peer company review period (in years)	2 years
Second Anniversary of Award Date | Restricted Stock Units TSR
Percentage of restricted stock units vesting	67.00%
Peer company review period (in years)	2 years
Third Anniversary of Award Date | Stock Options
Percent of options vesting	25.00%
Third Anniversary of Award Date | Restricted Stock Units (RSUs)
Percentage of restricted stock units vesting	33.00%
Third Anniversary of Award Date | Restricted Stock Units TSR
Percentage of restricted stock units vesting	33.00%
Fourth Anniversary of Award Date | Stock Options
Percent of options vesting	25.00%
Minimum | Restricted Stock Units (RSUs)
Award vesting period	2 years
Maximum | Restricted Stock Units (RSUs)
Award vesting period	4 years

Stock-Based Compensation - Expe

Stock-Based Compensation - Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock options and restricted stock units	$ 479	$ 487	$ 1,520	$ 1,320
Tax benefit of stock-based compensation expense	0	(188)	0	(508)
After-tax effect of stock-based compensation	$ 479	$ 299	$ 1,520	$ 812

Stock-Based Compensation (Det35

Stock-Based Compensation (Detail) - Stock Option Activity $ / shares in Units, $ in Thousands	9 Months Ended
	Sep. 30, 2016USD ($)$ / sharesshares
Number of Options (in shares):
Beginning balance (in shares) | shares	1,191,125
Granted (in shares) | shares	81,000
Exercised (in shares) | shares	0
Expired or forfeited (in shares) | shares	(200,375)
Ending balance (in shares) | shares	1,071,750
Exercisable (in shares) | shares	1,071,750
Weighted-Average Exercise Price (in dollars per share):
Beginning balance (in dollars per share) | $ / shares	$ 10.48
Granted (in dollars per share) | $ / shares	1.58
Exercised (in dollars per share) | $ / shares	0
Expired or forfeited (in dollars per share) | $ / shares	16.39
Ending balance (in dollars per share) | $ / shares	8.70
Exercisable (in dollars per share) | $ / shares	$ 8.70
Outstanding, Weighted Average Remaining Contractual Term (in years)	4 years 8 months 10 days
Exercisable, Weighted Average Remaining Contractual Term (in years)	4 years 8 months 10 days
Outstanding, Aggregate Intrinsic Value | $	$ 0
Exercisable, Aggregate Intrinsic Value | $	$ 0

Stock-Based Compensation (Det36

Stock-Based Compensation (Detail) - Restricted Stock Unit Activity - Restricted Stock	9 Months Ended
	Sep. 30, 2016$ / sharesshares
Shares (in shares)
Beginning balance (in shares) | shares	1,204,883
Granted (in shares) | shares	845,862
Forfeited (in shares) | shares	(172,949)
Vested (in shares) | shares	(381,916)
Ending balance (in shares) | shares	1,495,880
Weighted Average Grant Date Fair Value (in Dollars per share)
Beginning balance (in dollars per share) | $ / shares	$ 4.21
Granted (in dollars per share) | $ / shares	1.88
Forfeited (in dollars per share) | $ / shares	4.58
Vested (in dollars per share) | $ / shares	4.36
Ending balance (in dollars per share) | $ / shares	$ 2.81

Debt Financing (Detail)

Debt Financing (Detail)	Jun. 26, 2015CNY (¥)	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Jul. 31, 2017USD ($)	Jun. 24, 2016CNY (¥)	Jun. 24, 2016USD ($)	May 31, 2016USD ($)	May 09, 2016USD ($)	Dec. 31, 2015USD ($)
Basis spread on variable rate (as percent)		3.00%
Annual capital expenditure limit		$ 5,000,000
Domestic Line of Credit
Letters of credit, amount outstanding		$ 3,316,000							$ 7,803,000
Line of credit, commitment fee percentage		0.25%
China Facility
Line of credit, maximum borrowing capacity	¥ 35,000,000				¥ 6,500,000	$ 975,000
Line of credit, amount outstanding		$ 0
Interest paid		0	$ 30,000
Standby Letters of Credit
Letters of credit, amount outstanding		179,000							57,000
Line of credit, remaining borrowing capacity		796,000							$ 5,335,000
Amended Amount
Line of credit, maximum borrowing capacity		15,000,000					$ 6,000,000	$ 7,000,000
Amount Available for Increase Upon Approval of Lender
Line of credit, maximum borrowing capacity		25,000,000
Base Rate | China Facility
Basis spread on variable rate (as percent)	125.00%
Debt Instrument, Redemption, Period One | Revolving Credit Facility
Minimum EBITDA		500,000
Debt Instrument, Redemption, Period Two | Revolving Credit Facility
Minimum EBITDA		1,000,000
Minimum working capital		$ 35,000
Scenario, Forecast | Subsequent Event | Amended Amount
Line of credit, maximum borrowing capacity				$ 5,000,000

Business Segment and Geograph38

Business Segment and Geographic Financial Data (Detail)	9 Months Ended
	Sep. 30, 2016segment
Segment Reporting [Abstract]
Number of reportable segments	3

Business Segment and Geograph39

Business Segment and Geographic Financial Data (Detail) - Reporting Segment Net Sales and Gross Margin - USD ($) $ in Thousands	3 Months Ended				9 Months Ended
	Sep. 30, 2016	Mar. 31, 2016	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues from external customers	$ 12,596		$ 21,677		$ 45,593	$ 55,463
Cost of sales	(7,281)		(13,829)		(28,650)	(33,813)
Gross margin	5,315		7,848		16,943	21,650
Selling, general and administrative	(5,789)		(7,122)		(19,711)	(23,490)
Restructuring charge	(1,108)	$ (317)	0	$ (235)	(1,425)	(235)
Research and development	(1,302)		(1,521)		(3,582)	(3,375)
Operating (loss)	(2,884)		(795)		(7,775)	(5,450)
Air Pollution Control Segment
Revenues from external customers	6,042		13,078		29,063	31,022
Cost of sales	(4,233)		(10,021)		(20,704)	(22,111)
Gross margin	1,809		3,057		8,359	8,911
Selling, general and administrative	0		0		0	0
Restructuring charge	(373)		0		(537)	(179)
Research and development	0		0		0	0
Operating (loss)	1,436		3,057		7,822	8,732
FUEL CHEM Segment
Revenues from external customers	6,554		8,599		16,530	24,441
Cost of sales	(3,048)		(3,808)		(7,946)	(11,702)
Gross margin	3,506		4,791		8,584	12,739
Selling, general and administrative	0		0		0	0
Restructuring charge	(735)		0		(888)	(56)
Research and development	0		0		0	0
Operating (loss)	2,771		4,791		7,696	12,683
Fuel Conversion Segment
Selling, general and administrative	0		0		0	0
Restructuring charge	0		0		0	0
Research and development	(630)		(1,111)		(2,144)	(2,212)
Operating (loss)	(630)		(1,111)		(2,144)	(2,212)
Other
Selling, general and administrative	(5,789)		(7,122)		(19,711)	(23,490)
Restructuring charge	0		0		0	0
Research and development	(672)		(410)		(1,438)	(1,163)
Operating (loss)	$ (6,461)		$ (7,532)		$ (21,149)	$ (24,653)

Business Segment and Geograph40

Business Segment and Geographic Financial Data (Detail) - Operations by Geographic Area - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Revenues:
Revenues	$ 12,596	$ 21,677	$ 45,593	$ 55,463
United States
Revenues:
Revenues	9,838	13,665	36,523	38,141
Foreign
Revenues:
Revenues	$ 2,758	$ 8,012	$ 9,070	$ 17,322

Business Segment and Geograph41

Business Segment and Geographic Financial Data (Detail) - Assets by Geographic Area - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets
Assets	$ 64,831	$ 76,011
United States
Assets
Assets	42,938	47,437
Foreign
Assets
Assets	$ 21,893	$ 28,574

Contingencies (Detail) - Warran

Contingencies (Detail) - Warranty Liability - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Amount of alleged claim	$ 3,900
Change in Warranty Liability
Aggregate product warranty liability at beginning of period	268	$ 268
Net aggregate expense (benefit) related to product warranties	(109)	8
Aggregate reductions for payments	0	(8)
Aggregate product warranty liability at end of period	$ 159	$ 268

Income Taxes (Detail)

Income Taxes (Detail) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Income Tax Disclosure [Abstract]
Effective tax rate (as a percent)	2.00%	42.00%
Federal tax rate (as a percent)	34.00%	34.00%
Unrecognized tax benefits	$ 37		$ 140

Goodwill and Other Intangibles

Goodwill and Other Intangibles (Detail) $ in Thousands	9 Months Ended
	Sep. 30, 2016USD ($)reporting_unit	Dec. 31, 2015USD ($)
Goodwill	$ 2,116	$ 2,116
FUEL CHEM And APC Technology Segments
Number of reporting units | reporting_unit	2
Fuel Chem Technology Segment
Goodwill		$ 2,116