Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 09, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-10799 | |
Entity Registrant Name | ADDvantage Technologies Group, Inc. | |
Entity Incorporation, State or Country Code | OK | |
Entity Tax Identification Number | 73-1351610 | |
Entity Address, Address Line One | 1430 Bradley Lane, Suite 196 | |
Entity Address, City or Town | Carrollton | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75007 | |
City Area Code | (918) | |
Local Phone Number | 251-9121 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 14,982,524 | |
Entity Central Index Key | 0000874292 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 2,832 | $ 2,552 |
Restricted cash | 739 | 1,101 |
Accounts receivable, net of allowances of $304 and $262, respectively | 1,385 | 1,682 |
Unbilled revenue | 1,831 | 5,005 |
Income tax receivable | 102 | 102 |
Inventories, net of allowances of $4,097 and $3,871, respectively | 8,076 | 9,563 |
Prepaid expenses and other current assets | 1,203 | 1,399 |
Total current assets | 16,168 | 21,404 |
Property and equipment, at cost: | ||
Machinery and equipment | 5,565 | 5,542 |
Leasehold improvements | 899 | 899 |
Total property and equipment, at cost | 6,464 | 6,441 |
Less: Accumulated depreciation | (3,533) | (3,057) |
Net property and equipment | 2,931 | 3,384 |
Right-of-use lease assets | 1,060 | 1,540 |
Intangibles, net of accumulated amortization | 549 | 709 |
Goodwill | 58 | 58 |
Other assets | 207 | 123 |
Total assets | 20,973 | 27,218 |
Current liabilities: | ||
Accounts payable | 6,151 | 9,407 |
Accrued expenses | 1,428 | 1,445 |
Deferred revenue | 349 | 148 |
Notes payable | 2,210 | 0 |
Right-of-use lease obligations, current | 933 | 1,204 |
Finance lease obligations, current | 640 | 636 |
Other current liabilities | 589 | 442 |
Total current liabilities | 12,300 | 13,282 |
Right-of-use lease obligations, long-term | 288 | 635 |
Finance lease obligations, long-term | 937 | 1,254 |
Total liabilities | 13,525 | 15,171 |
Shareholders’ equity: | ||
Common stock, $0.01 par value; 30,000,000 shares authorized; 14,942,524 and 14,132,033 shares issued and outstanding, respectively | 149 | 141 |
Paid in capital | 3,559 | 2,585 |
Retained earnings | 3,740 | 9,321 |
Total shareholders’ equity | 7,448 | 12,047 |
Total liabilities and shareholders’ equity | $ 20,973 | $ 27,218 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 304 | $ 262 |
Inventory valuation reserves | $ 4,097 | $ 3,871 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Common stock, shares issued (in shares) | 14,942,524 | 14,132,033 |
Common stock, shares outstanding (in shares) | 14,942,524 | 14,132,033 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Statement [Abstract] | ||||
Sales | $ 12,088 | $ 27,789 | $ 26,807 | $ 51,548 |
Cost of sales | 8,816 | 19,642 | 20,118 | 37,643 |
Gross profit | 3,272 | 8,147 | 6,689 | 13,905 |
Operating expenses | 1,967 | 2,544 | 4,014 | 5,296 |
Selling, general and administrative expenses | 3,288 | 4,145 | 6,894 | 7,996 |
Depreciation and amortization expense | 317 | 313 | 634 | 630 |
Loss on disposal of assets | 0 | 0 | 0 | 2 |
Income (loss) from operations | (2,300) | 1,145 | (4,853) | (19) |
Other income (expense): | ||||
Other income (expense) | (184) | (233) | (333) | (401) |
Interest expense | (334) | (37) | (379) | (99) |
Other income (expense), net | (518) | (270) | (712) | (500) |
Income (loss) before income taxes | (2,818) | 875 | (5,565) | (519) |
Income tax provision | 16 | 0 | 16 | 0 |
Net income (loss) | $ (2,834) | $ 875 | $ (5,581) | $ (519) |
Income (loss) per share: | ||||
Basic (in dollars per share) | $ (0.20) | $ 0.07 | $ (0.41) | $ (0.04) |
Diluted (in dollars per share) | $ (0.20) | $ 0.07 | $ (0.41) | $ (0.04) |
Shares used in per share calculation: | ||||
Basic (in shares) | 13,999,816 | 13,191,792 | 13,638,538 | 13,131,754 |
Diluted (in shares) | 13,999,816 | 13,191,792 | 13,638,538 | 13,131,754 |
Revenue from Contract with Customer, Product and Service [Extensible Enumeration] | Product [Member] | Product [Member] | Product [Member] | Product [Member] |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Paid-in Capital | Retained Earnings |
Beginning Balance (in shares) at Dec. 31, 2021 | 13,041,127 | |||
Beginning Balance at Dec. 31, 2021 | $ 9,315 | $ 130 | $ 335 | $ 8,850 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (1,394) | (1,394) | ||
Common stock issuance (in shares) | 143,985 | |||
Common stock issuance | 168 | $ 2 | 166 | |
Restricted stock issuance (in shares) | 4,000 | |||
Restricted stock issuance | 0 | $ 0 | 0 | |
Amortization of stock-based compensation | 247 | 247 | ||
Ending Balance (in shares) at Mar. 31, 2022 | 13,189,112 | |||
Ending Balance at Mar. 31, 2022 | 8,336 | $ 132 | 748 | 7,456 |
Beginning Balance (in shares) at Dec. 31, 2021 | 13,041,127 | |||
Beginning Balance at Dec. 31, 2021 | 9,315 | $ 130 | 335 | 8,850 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (519) | |||
Ending Balance (in shares) at Jun. 30, 2022 | 13,168,191 | |||
Ending Balance at Jun. 30, 2022 | 9,353 | $ 132 | 890 | 8,331 |
Beginning Balance (in shares) at Mar. 31, 2022 | 13,189,112 | |||
Beginning Balance at Mar. 31, 2022 | 8,336 | $ 132 | 748 | 7,456 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | 875 | 875 | ||
Common stock issuance (in shares) | 30,745 | |||
Common stock issuance | 38 | 38 | ||
Restricted stock forfeitures (in shares) | (51,666) | |||
Restricted stock forfeitures | 0 | $ (1) | 1 | |
Amortization of stock-based compensation | 103 | 103 | ||
Ending Balance (in shares) at Jun. 30, 2022 | 13,168,191 | |||
Ending Balance at Jun. 30, 2022 | $ 9,353 | $ 132 | 890 | 8,331 |
Beginning Balance (in shares) at Dec. 31, 2022 | 14,132,033 | 14,132,033 | ||
Beginning Balance at Dec. 31, 2022 | $ 12,047 | $ 141 | 2,585 | 9,321 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (2,748) | (2,748) | ||
Restricted stock issuance (in shares) | 656,824 | |||
Restricted stock issuance | 0 | $ 7 | (7) | |
Amortization of stock-based compensation | 399 | 399 | ||
Ending Balance (in shares) at Mar. 31, 2023 | 14,788,857 | |||
Ending Balance at Mar. 31, 2023 | $ 9,698 | $ 148 | 2,977 | 6,573 |
Beginning Balance (in shares) at Dec. 31, 2022 | 14,132,033 | 14,132,033 | ||
Beginning Balance at Dec. 31, 2022 | $ 12,047 | $ 141 | 2,585 | 9,321 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | $ (5,581) | |||
Ending Balance (in shares) at Jun. 30, 2023 | 14,942,524 | 14,942,524 | ||
Ending Balance at Jun. 30, 2023 | $ 7,448 | $ 149 | 3,559 | 3,740 |
Beginning Balance (in shares) at Mar. 31, 2023 | 14,788,857 | |||
Beginning Balance at Mar. 31, 2023 | 9,698 | $ 148 | 2,977 | 6,573 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net income (loss) | (2,834) | (2,834) | ||
Common stock issuance (in shares) | 72,000 | |||
Common stock issuance | 385 | $ 1 | 384 | |
Restricted stock issuance (in shares) | 81,667 | |||
Restricted stock issuance | 0 | $ 1 | (1) | |
Amortization of stock-based compensation | $ 199 | 199 | ||
Ending Balance (in shares) at Jun. 30, 2023 | 14,942,524 | 14,942,524 | ||
Ending Balance at Jun. 30, 2023 | $ 7,448 | $ 149 | $ 3,559 | $ 3,740 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Operating Activities: | ||
Net income (loss) | $ (5,581) | $ (519) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||
Depreciation | 475 | 471 |
Amortization | 360 | 159 |
Non cash amortization of right-of-use asset and liability | (138) | (131) |
Provision for excess and obsolete inventories | 226 | 147 |
Charge for lower of cost or net realizable value inventories | 51 | 0 |
Share based compensation expense | 598 | 350 |
Gain on disposal of property and equipment | 0 | 2 |
Changes in assets and liabilities: | ||
Accounts receivable | 297 | 4,085 |
Unbilled revenue | 3,174 | (567) |
Inventories | 1,210 | (2,104) |
Prepaid expenses and other current assets | 112 | (201) |
Accounts payable | (3,256) | 3,747 |
Accrued expenses and other liabilities | 133 | 542 |
Deferred revenue | 201 | (120) |
Net cash (used in) provided by operating activities | (2,138) | 5,861 |
Investing Activities: | ||
Purchases of property and equipment | (23) | (129) |
Disposals of property and equipment | 0 | 42 |
Net cash used in investing activities | (23) | (87) |
Financing Activities: | ||
Change in bank line of credit | 0 | (2,050) |
Proceeds from notes payable | 2,850 | 0 |
Payment for debt issuance costs | (270) | 0 |
Payments on notes payable | (187) | 0 |
Payments on financing lease obligations | (314) | (409) |
Proceeds from sale of common stock | 0 | 206 |
Net cash provided by (used in) financing activities | 2,079 | (2,253) |
Net (decrease) increase in cash, cash equivalents and restricted cash | (82) | 3,521 |
Cash, cash equivalents and restricted cash at beginning of period | 3,653 | 2,418 |
Cash, cash equivalents and restricted cash at end of period | $ 3,571 | $ 5,939 |
Basis of Presentation and Accou
Basis of Presentation and Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Accounting Policies | Basis of Presentation and Accounting Policies Basis of presentation The consolidated financial statements include the accounts of ADDvantage Technologies Group, Inc. and its subsidiaries, all of which are wholly owned (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. The Company’s reportable segments are Wireless Infrastructure Services (“Wireless”) and Telecommunications (“Telco”). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. However, the information furnished reflects all adjustments, which are, in the opinion of management, necessary in order to make the unaudited consolidated financial statements not misleading. The Company’s business is subject to seasonal variations due to weather in the geographic areas where services are performed, as well as calendar events and national holidays. Therefore, the results of operations for the six months ended June 30, 2023 and 2022, are not necessarily indicative of the results to be expected for the full fiscal year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. Change in year end In September 2022, the Company's Board of Directors approved a change in the Company's fiscal year end from September 30 to December 31. The Company's current fiscal year runs from January 1 through December 31. As a result of the change in year end, the Company filed a Transition Report on Form 10-Q for the period from October 1, 2021 through December 31, 2021. Recently Adopted Accounting Standards Financial Instruments – Credit Losses . The Financial Accounting Standards Board ("FASB") issued five Accounting Standards Updates (ASUs) related to financial instruments – credit losses. The ASUs issued were: (1) in June 2016, ASU 2016-13, “ Financial Instruments – Credit Losses (“ASC 326”): Measurement of Credit Losses on Financial Instruments,” (2) in November 2018, ASU 2018-19, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses,” (3) in April 2019, ASU 2019-04, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments,” (4) in May 2019, ASU 2019-05, “Financial Instruments – Credit Losses (Topic 326): Targeted Transition Relief ” and (5) in November 2019, ASU 2019-11, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses.” Additionally, in February and March 2020, the FASB issued ASU 2020-02, “Financial Instruments—Credit Losses (Topic 326) and Leases (ASC 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (ASC 842)” and ASU 2020-03, “Codification Improvements to Financial Instruments,” respectively, which include amendments to ASC 326. ASU 2016-13 is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. ASU 2018-19 clarifies that receivables arising from operating leases are not within the scope of the credit losses standard, but rather, should be accounted for in accordance with the leasing standard. ASU 2019-04 clarifies and improves areas of guidance related to the recently issued standards on financial instruments – credit losses, derivatives and hedging, and financial instruments. ASU 2019-05 provides entities that have certain instruments within the scope of ASC Subtopic 326-20, Financial Instruments—Credit Losses—Measured at Amortized Cost, with an option to irrevocably elect the fair value option in Subtopic 825-10, Financial Instruments—Overall. ASU 2019-11 clarifies guidance around how to report expected recoveries and reinforces existing guidance that prohibits organizations from recording negative allowances for available-for-sale debt securities, among other narrow scope and technical improvements. ASU 2020-02 adds a Securities and Exchange Commission (SEC) paragraph pursuant to the issuance of SEC Staff Accounting Bulletin No. 119 on loan losses to FASB Codification ASC 326 and also updates the SEC section of the Codification for the change in the effective date of ASC 842. ASU 2020-03 makes narrow-scope improvements to various aspects of the financial instrument guidance as part of the FASB’s ongoing Codification improvement project aimed at clarifying specific areas of accounting guidance to help avoid unintended application. The Company adopted the applicable guidance in ASU 2016-13, ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11, ASU 2020-02 and ASU 2020-03 on January 1, 2023, and the adoption did not have a material impact on its consolidated financial statements and related disclosures. |
Going Concern Assessment
Going Concern Assessment | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern Assessment | Going Concern Assessment The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities and commitments in the normal course of business. Should the Company be unable to continue as a going concern, it may be unable to realize the carrying value of its assets and to meet its liabilities as they become due. The Company has been subject to adverse conditions that raise substantial doubt about the Company's ability to continue as a going concern for one year following the issuance of these unaudited interim consolidated financial statements, including negative financial trends, specifically operating losses, working capital deficiency, and other adverse key financial ratios. Additionally, the impacts of unfavorable wireless industry conditions and significant debt service requirements on the Company’s financial position, results of operations, and cash flows give rise to substantial doubt about the Company’s ability to pay its obligations as they come due. In consideration of the substantial amount of short-term debt outstanding, detailed below, and the aforementioned unfavorable wireless industry conditions, the Company will be engaging advisors to assist with the evaluation, negotiation, and consummation of strategic alternatives, which may include, but are not limited to, seeking a restructuring, amendment or refinancing of existing debt through a private restructuring, the issuance of equity securities, a sale of a portion or all of the Company or its assets, or reorganization under Chapter 11 of the Bankruptcy Code. However, there can be no assurances that the Company will be able to successfully restructure its indebtedness, raise additional capital, improve its financial position or complete any strategic transactions. As a result of these uncertainties and the likelihood of a restructuring or reorganization, management has concluded that there is substantial doubt regarding the Company’s ability to continue as a going concern within one year that these financial statements are made available. Management’s plans to alleviate the substantial doubt about the Company’s ability to continue as a going concern include attempting to grow its revenues and improve its business profitability and its ability to generate sufficient cash flow from its operations to meet its operating needs on a timely basis, obtaining additional working capital funds through various sources, and eliminating inefficiencies in order to meet its anticipated cash requirements. However, there can be no assurance that these plans and arrangements will be sufficient to fund the Company’s ongoing capital expenditures and other requirements. The unaudited interim consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern. Management Plans In assessing the Company’s liquidity, management reviews its cash and its operating and capital expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating expenses, capital expenditure and debt service obligations. As of June 30, 2023, the Company’s current liabilities exceeded the current assets by approximately $4.2 million, exclusive of inventories. Management is evaluating all options to refinance its existing short-term debt obligations as well as exploring alternative financing, refinancing, restructuring and capital-raising activities, in order to address its ongoing liquidity needs and to maintain sufficient access to the loan and capital markets on commercially acceptable terms to finance its business. In support of these efforts, management is pursuing various initiatives including, but not limited to, the following: • Cash management: An attentive and strategic focus on cash flow has been implemented. A weekly cash flow forecast is produced that analyzes cash flow activities as well as anticipated cash flow. Also, the Company is focused on optimizing working capital management; • Operating results: Management is committed to focusing on operating results, which is expected to improve operating cash flows and bring the Company’s financial performance back in line with historical operating results. The Company expects to see continued improvement in cash flow throughout 2024 as the increase in orders from new customers improve earnings. As construction in the fiber broadband space increases, along with concerted attempts to enter into a long term agreement with a significant customer in the Wireless segment, sales growth is expected to increase and margins to expand as a result of operating leverage; • Capital spending: Management expects to minimize capital expenditures in 2024; • Strategic options: An investment banker is being engaged to investigate all strategic options, including the disposal of assets; and • Debt refinancing: Continued undertakings to partially or completely refinance the debt. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company’s principal sales are from Wireless services and sales of Telco equipment, primarily in the United States. Sales to international customers totaled approximately $1.2 million and $2.0 million for the three months ended June 30, 2023 and 2022, respectively, and $2.8 million and $3.6 million for the six months ended June 30, 2023 and 2022, respectively. The Company’s customers include wireless carriers, wireless equipment providers, multiple system operators, resellers and direct sales to end-user customers. Sales, which individually amounted to 10% or greater of the Company's revenue, to two customers totaled 31%, and to two customers totaled 33% of consolidated revenues for the six months ended June 30, 2023 and 2022, respectively. Our sales by type were as follows, in thousands: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Wireless services sales $ 6,329 $ 7,243 $ 12,901 $ 15,009 Equipment sales: Telco equipment 5,750 20,346 13,897 36,333 Telco repair 9 8 9 14 Telco recycle — 192 — 192 Total sales $ 12,088 $ 27,789 $ 26,807 $ 51,548 Contract assets and contract liabilities are included in unbilled revenue and deferred revenue, respectively, in the consolidated balance sheets. At June 30, 2023 and December 31, 2022, contract assets were $1.8 million and $5.0 million, respectively, and contract liabilities were $0.3 million and $0.1 million, respectively. The Company recognized $0.1 million of contract revenue during the six months ended June 30, 2023 related to contract liabilities recorded in deferred revenue at December 31, 2022. |
Accounts Receivable Agreements
Accounts Receivable Agreements | 6 Months Ended |
Jun. 30, 2023 | |
Receivables [Abstract] | |
Accounts Receivable Agreements | Accounts Receivable Agreements The Company maintains accounts receivable purchase facilities for its Nave and Triton subsidiaries with its primary financial lender with capacities of $10.0 million for Nave and $3.0 million for Triton. The lender charges a fee of 1.75% of sold receivables. The Company also maintains accounts receivable purchase facilities for its Fulton subsidiary, providing a credit capacity excluding a major customer of $3.0 million, with a fee of 2.0% of sold receivables, and credit capacity secured by receivables of a major customer of $3.0 million, with a fee of 1.6% of sold receivables. All four facilities are secured by the subsidiary's receivables, and the lender advances 90% of sold receivables and establishes a reserve of 10% of the sold receivables at initial sale, which increases to 100% over time after 120 days, until the Company collects the sold receivables. All four facilities mature on December 17, 2023. The Company has a total capacity under all four facilities of $19.0 million. As of June 30, 2023, the lender has a reserve against the sold receivables of $0.7 million, which is reflected as restricted cash on the consolidated balance sheets. The facilities agreements address events and conditions which may obligate the Company to immediately repay the institution the outstanding purchase price of the receivables sold. The total amount of receivables uncollected by the institution was $3.1 million at June 30, 2023. Although the sale of receivables is with recourse, the Company did not record a recourse obligation at June 30, 2023 as the Company concluded that the sold receivables are collectible. For the six months ended June 30, 2023, the Company received proceeds from the sold receivables under all of their various agreements of $22.8 million and included the proceeds in net cash provided by operating activities in the consolidated statements of cash flows. The Company recorded related costs of $0.4 million for the six months ended June 30, 2023, in other expense in the consolidated statements of operations. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories, which are all within the Telco segment, at June 30, 2023 and December 31, 2022 are as follows, in thousands: June 30, 2023 December 31, 2022 New equipment $ 1,976 $ 2,286 Refurbished and used equipment 10,197 11,148 Allowance for excess and obsolete inventory (4,097) (3,871) Total inventories, net $ 8,076 $ 9,563 New equipment includes products purchased from manufacturers plus “surplus-new”, which are unused products purchased from other distributors or multiple system operators. Refurbished and used equipment includes factory refurbished, Company refurbished and used products. Generally, the Company does not refurbish its used inventory until there is a sale of that product or to keep a certain quantity on hand. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets with their associated accumulated amortization and impairment at June 30, 2023 and December 31, 2022 are as follows, in thousands: June 30, 2023 Intangible assets: Gross Accumulated Amortization Net Customer relationships – 10 years $ 3,155 $ (2,966) $ 189 Trade name – 10 years 2,122 (1,762) 360 Total intangible assets $ 5,277 $ (4,728) $ 549 December 31, 2022 Intangible assets: Gross Accumulated Net Customer relationships – 10 years $ 3,155 $ (2,913) $ 242 Trade name – 10 years 2,122 (1,655) 467 Total intangible assets $ 5,277 $ (4,568) $ 709 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt Credit Agreement On March 17, 2022, the Company closed its $3.0 million credit facility for its Nave and Triton subsidiaries with its primary financial lender. See Note 4 - Accounts Receivable Agreements for more information about the Company's receivables purchase facilities. Convertible Promissory Notes In April 2023, the Company entered into securities purchase agreements for the issuance of convertible senior promissory notes (the “April Notes”) with Mast Hill Fund, L.P. (the “Holder”). In the aggregate, the principal balance was $3.0 million, of which the purchase price was $2.8 million, and the original issue discount was $0.2 million. The April Notes have a term of one year and bear interest at a rate of 13% per annum. The Company and its subsidiaries entered into certain Security Agreements, creating a security interest in certain property of the Company and its subsidiaries to secure the prompt payment, performance, and discharge in full of the Company’s obligations under the April Notes. The April Notes are subject to certain covenants as defined in the securities purchase agreement which includes maintaining its common stock listing status with the Nasdaq Capital Market, and maintaining a minimum market capitalization of $5 million. In connection with the issuance of the April Notes, the Company issued (i) warrants to purchase 360,000 shares of common stock with an exercise price of $2.50 exercisable until the five-year anniversary of the closing date, and (ii) a warrant to purchase 288,000 shares of common stock with an exercise price of $1.40 exercisable until the five-year anniversary of the closing date, which warrant shall be cancelled and extinguished against payment of the Notes (together, the “April Warrants”). Additionally, as a commitment fee to the Holder, 72,000 shares of the Company’s common stock were issued in connection with the April Notes. The April Notes also contain a conversion feature which allows the Holder to convert any portion of the outstanding unpaid principal and interest into shares of the Company’s common stock at a conversion price of $2.50 per share. Pursuant to the April Notes, the Company is required to hold an annual shareholders meeting within 90 calendar days after the first date that the Company's common stock traded at a share price below $1.00 during five five The conversion feature contained in the April Notes was evaluated for derivative accounting under ASC 815, Derivatives and Hedging , and determined not to be considered a derivative and therefore has been recorded in liabilities as part of the April Notes and not bifurcated. The April Warrants were evaluated and did not meet the criteria to be classified as derivatives, and accordingly, were recognized as equity instruments at fair value using a Black-Scholes model valuation. The commitment fee shares were earned upon closing, and as such were recognized as equity based on the closing stock price. As of June 30, 2023, the contra-liabilities for the commitment fee and April Warrants were $0.3 million and are amortized to interest expense, the remaining debt issuance costs were $0.3 million, repayments on the April Notes were $0.2 million, and the net outstanding principal balance of the April Notes was $2.2 million. |
Equity Distribution Agreement a
Equity Distribution Agreement and Sale of Common Stock | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Equity Distribution Agreement and Sale of Common Stock | Equity Distribution Agreement and Sale of Common Stock On April 24, 2020, the Company entered into an Equity Distribution Agreement (the “Sales Agreement”) with Northland Securities, Inc., as agent (“Northland”), pursuant to which the Company may offer and sell, from time to time, through Northland, shares of the Company’s common stock, par value $0.01 per share, having an aggregate offering price of up to $13.9 million ("Shares"). The offer and sale of the Shares were made pursuant to a shelf registration statement on Form S-3 and the related prospectus filed by the Company with the Securities and Exchange Commission (the "SEC") on March 3, 2020, as amended on March 23, 2020, and declared effective by the SEC on April 1, 2020. Pursuant to the Sales Agreement, Northland sold the Shares by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act of 1933 (the “Securities Act”), including sales made by means of ordinary brokers’ transactions, including on The Nasdaq Capital Market, at market prices or as otherwise agreed with Northland. Northland used commercially reasonable efforts consistent with its normal trading and sales practices to sell the Shares from time to time, based upon instructions from the Company, including any price or size limits or other customary parameters or conditions the Company may have imposed. The Company paid Northland a commission rate equal to an aggregate of 3.0% of the aggregate gross proceeds from each sale of Shares and agreed to provide Northland with customary indemnification and contribution rights. The Company also reimbursed Northland for certain specified expenses in connection with entering into the Sales Agreement. The Sales Agreement contained customary representations and warranties and conditions to the placements of the Shares pursuant thereto. During the six months ended June 30, 2022, 174,730 Shares were sold by Northland on behalf of the Company with gross proceeds of $0.2 million, and net proceeds after commissions and fees of $0.2 million. On November 28, 2022, the Company terminated the Sales Agreement with Northland. There were no penalties associated with the termination of the Sales Agreement. As a result of the termination, no shares were sold during the six months ended June 30, 2023. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic and diluted earnings per share for the three and six months ended June 30, 2023 and 2022, in thousands: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net income (loss) attributable to common shareholders $ (2,834) $ 875 $ (5,581) $ (519) Basic and diluted weighted average shares 14,000 13,192 13,639 13,132 Basic and diluted loss per common share $ (0.20) $ 0.07 $ (0.41) $ (0.04) The table below includes information related to stock options and restricted stock awards that were outstanding at the end of each respective three and six-month period ended June 30, but have been excluded from the computation of weighted average shares for dilutive securities because their effect would be anti-dilutive. Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Stock options excluded — 50,000 — 50,000 Weighted average exercise price of stock options $ 1.28 $ 1.28 Average market price of common stock $ 1.27 $ 1.29 Unvested restricted stock awards 897,490 — 897,490 — |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 6 Months Ended |
Jun. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information (in thousands) Six Months Ended June 30, 2023 2022 Supplemental cash flow information: Cash paid for interest $ 378 $ 99 Cash paid for taxes $ 16 $ — Supplemental noncash investing and financing activities: Assets acquired under financing leases $ — $ 281 Common stock and warrants issued in conjunction with the issuance of convertible debt $ 384 $ — |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Plan Information The 2015 Incentive Stock Plan (the “Plan”) provides for awards of stock options and restricted stock to officers, directors, key employees and consultants. At June 30, 2023, 3,100,415 shares of common stock were reserved for stock award grants under the Plan. Of these reserved shares, 333,813 shares were available for future grants. Restricted stock awards A summary of the Company's non-vested restricted share awards at June 30, 2023 and changes during the three months ended June 30, 2023 is presented in the following table (in thousands, except shares): Shares Fair Value Non-vested at March 31, 2023 912,883 $ 1,403 Granted 95,000 80 Vested (97,060) (138) Forfeited (13,333) (34) Non-vested at June 30, 2023 897,490 $ 1,311 During the three month period ended June 30, 2023 and 2022, expenses related to share-based arrangements including restricted stock, were $0.2 million and $0.1 million, respectively. During the six month period ended June 30, 2023 and 2022, compensation expenses related to share-based arrangements including restricted stock, were $0.6 million and $0.4 million respectively. The Company did not recognize a tax benefit for compensation expense recognized during the three and six months ended June 30, 2023 and 2022. At June 30, 2023, unrecognized compensation expense related to non-vested stock-based compensation awards not yet recognized in the consolidated statements of operations was $0.6 million. That cost is expected to be recognized over a period of 3.0 years. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Leases | LeasesThe Company has a right-of-use for a building in Jessup, Maryland which was no longer being used in operations. The Maryland property was subleased as of June 30, 2023 and will end in November, 2023. Rental payments received related to the sublease was recorded as a reduction of rent expense in our consolidated statements of operations for the periods ending June 30, 2023 and 2022. |
Segment Reporting
Segment Reporting | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting The Company is reporting its financial performance based on its external reporting segments: Wireless Infrastructure Services and Telecommunications. These reportable segments are described below. Wireless Infrastructure Services (“Wireless”) The Company's Wireless segment provides turn-key wireless infrastructure services for the four major U.S. wireless carriers, communication tower companies, national integrators, and original equipment manufacturers that support these wireless carriers. These services primarily consist of the installation and upgrade of technology on cell sites and the construction of new small cells for 5G. Telecommunications (“Telco”) The Company’s Telco segment sells new and refurbished telecommunications networking equipment, including both central office and customer premise equipment, to its customer base of telecommunications providers, enterprise customers and resellers located primarily in North America. This segment also offers its customers repair and testing services for telecommunications networking equipment. The Company evaluates performance and allocates its resources based on operating income. The accounting policies of its reportable segments are the same as those described in the summary of significant accounting policies. Segment assets consist primarily of cash and cash equivalents, accounts receivable, inventory, property and equipment, goodwill and intangible assets. The Company allocates its corporate general and administrative expenses to the reportable segments. (in thousands) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Sales Wireless $ 6,329 $ 7,243 $ 12,901 $ 15,009 Telco 5,759 20,546 13,906 36,539 Total sales $ 12,088 $ 27,789 $ 26,807 $ 51,548 Gross profit Wireless $ 1,786 $ 1,974 $ 3,131 $ 3,511 Telco 1,486 6,173 3,558 10,394 Total gross profit $ 3,272 $ 8,147 $ 6,689 $ 13,905 Income (loss) from operations Wireless $ (1,676) $ (1,461) $ (3,780) $ (3,659) Telco (624) 2,606 (1,073) 3,640 Total income (loss) from operations $ (2,300) $ 1,145 $ (4,853) $ (19) (in thousands) June 30, 2023 December 31, 2022 Segment assets Wireless $ 6,260 $ 9,790 Telco 10,952 13,217 Non-allocated 3,761 4,211 Total assets $ 20,973 $ 27,218 |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events The Company has evaluated subsequent events through the filing of this Form 10-Q, and except as described below, determined that there have been no events that have occurred that would require adjustments to our disclosures in the consolidated financial statements. Accounts Receivable Agreements with Vast Bank, N.A On August 9, 2023, due to underutilization as a result of reduced sales the last two quarters, the Company signed Modification Addendums (the “Modification”) to its accounts receivable purchase facilities for its Nave, Triton and |
Basis of Presentation and Acc_2
Basis of Presentation and Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation The consolidated financial statements include the accounts of ADDvantage Technologies Group, Inc. and its subsidiaries, all of which are wholly owned (collectively, the “Company”). Intercompany balances and transactions have been eliminated in consolidation. The Company’s reportable segments are Wireless Infrastructure Services (“Wireless”) and Telecommunications (“Telco”). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial statements and do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. However, the information furnished reflects all adjustments, which are, in the opinion of management, necessary in order to make the unaudited consolidated financial statements not misleading. The Company’s business is subject to seasonal variations due to weather in the geographic areas where services are performed, as well as calendar events and national holidays. Therefore, the results of operations for the six months ended June 30, 2023 and 2022, are not necessarily indicative of the results to be expected for the full fiscal year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. |
Change in year end | Change in year end In September 2022, the Company's Board of Directors approved a change in the Company's fiscal year end from September 30 to December 31. The Company's current fiscal year runs from January 1 through December 31. As a result of the change in year end, the Company filed a Transition Report on Form 10-Q for the period from October 1, 2021 through December 31, 2021. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards Financial Instruments – Credit Losses . The Financial Accounting Standards Board ("FASB") issued five Accounting Standards Updates (ASUs) related to financial instruments – credit losses. The ASUs issued were: (1) in June 2016, ASU 2016-13, “ Financial Instruments – Credit Losses (“ASC 326”): Measurement of Credit Losses on Financial Instruments,” (2) in November 2018, ASU 2018-19, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses,” (3) in April 2019, ASU 2019-04, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments,” (4) in May 2019, ASU 2019-05, “Financial Instruments – Credit Losses (Topic 326): Targeted Transition Relief ” and (5) in November 2019, ASU 2019-11, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses.” Additionally, in February and March 2020, the FASB issued ASU 2020-02, “Financial Instruments—Credit Losses (Topic 326) and Leases (ASC 842): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (ASC 842)” and ASU 2020-03, “Codification Improvements to Financial Instruments,” respectively, which include amendments to ASC 326. ASU 2016-13 is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. ASU 2018-19 clarifies that receivables arising from operating leases are not within the scope of the credit losses standard, but rather, should be accounted for in accordance with the leasing standard. ASU 2019-04 clarifies and improves areas of guidance related to the recently issued standards on financial instruments – credit losses, derivatives and hedging, and financial instruments. ASU 2019-05 provides entities that have certain instruments within the scope of ASC Subtopic 326-20, Financial Instruments—Credit Losses—Measured at Amortized Cost, with an option to irrevocably elect the fair value option in Subtopic 825-10, Financial Instruments—Overall. ASU 2019-11 clarifies guidance around how to report expected recoveries and reinforces existing guidance that prohibits organizations from recording negative allowances for available-for-sale debt securities, among other narrow scope and technical improvements. ASU 2020-02 adds a Securities and Exchange Commission (SEC) paragraph pursuant to the issuance of SEC Staff Accounting Bulletin No. 119 on loan losses to FASB Codification ASC 326 and also updates the SEC section of the Codification for the change in the effective date of ASC 842. ASU 2020-03 makes narrow-scope improvements to various aspects of the financial instrument guidance as part of the FASB’s ongoing Codification improvement project aimed at clarifying specific areas of accounting guidance to help avoid unintended application. The Company adopted the applicable guidance in ASU 2016-13, ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11, ASU 2020-02 and ASU 2020-03 on January 1, 2023, and the adoption did not have a material impact on its consolidated financial statements and related disclosures. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Our sales by type were as follows, in thousands: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Wireless services sales $ 6,329 $ 7,243 $ 12,901 $ 15,009 Equipment sales: Telco equipment 5,750 20,346 13,897 36,333 Telco repair 9 8 9 14 Telco recycle — 192 — 192 Total sales $ 12,088 $ 27,789 $ 26,807 $ 51,548 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Inventories, which are all within the Telco segment, at June 30, 2023 and December 31, 2022 are as follows, in thousands: June 30, 2023 December 31, 2022 New equipment $ 1,976 $ 2,286 Refurbished and used equipment 10,197 11,148 Allowance for excess and obsolete inventory (4,097) (3,871) Total inventories, net $ 8,076 $ 9,563 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | Intangible assets with their associated accumulated amortization and impairment at June 30, 2023 and December 31, 2022 are as follows, in thousands: June 30, 2023 Intangible assets: Gross Accumulated Amortization Net Customer relationships – 10 years $ 3,155 $ (2,966) $ 189 Trade name – 10 years 2,122 (1,762) 360 Total intangible assets $ 5,277 $ (4,728) $ 549 December 31, 2022 Intangible assets: Gross Accumulated Net Customer relationships – 10 years $ 3,155 $ (2,913) $ 242 Trade name – 10 years 2,122 (1,655) 467 Total intangible assets $ 5,277 $ (4,568) $ 709 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Basic and diluted earnings per share for the three and six months ended June 30, 2023 and 2022, in thousands: Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Net income (loss) attributable to common shareholders $ (2,834) $ 875 $ (5,581) $ (519) Basic and diluted weighted average shares 14,000 13,192 13,639 13,132 Basic and diluted loss per common share $ (0.20) $ 0.07 $ (0.41) $ (0.04) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The table below includes information related to stock options and restricted stock awards that were outstanding at the end of each respective three and six-month period ended June 30, but have been excluded from the computation of weighted average shares for dilutive securities because their effect would be anti-dilutive. Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 Stock options excluded — 50,000 — 50,000 Weighted average exercise price of stock options $ 1.28 $ 1.28 Average market price of common stock $ 1.27 $ 1.29 Unvested restricted stock awards 897,490 — 897,490 — |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | (in thousands) Six Months Ended June 30, 2023 2022 Supplemental cash flow information: Cash paid for interest $ 378 $ 99 Cash paid for taxes $ 16 $ — Supplemental noncash investing and financing activities: Assets acquired under financing leases $ — $ 281 Common stock and warrants issued in conjunction with the issuance of convertible debt $ 384 $ — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Non-vested Restricted Share Awards | A summary of the Company's non-vested restricted share awards at June 30, 2023 and changes during the three months ended June 30, 2023 is presented in the following table (in thousands, except shares): Shares Fair Value Non-vested at March 31, 2023 912,883 $ 1,403 Granted 95,000 80 Vested (97,060) (138) Forfeited (13,333) (34) Non-vested at June 30, 2023 897,490 $ 1,311 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The Company evaluates performance and allocates its resources based on operating income. The accounting policies of its reportable segments are the same as those described in the summary of significant accounting policies. Segment assets consist primarily of cash and cash equivalents, accounts receivable, inventory, property and equipment, goodwill and intangible assets. The Company allocates its corporate general and administrative expenses to the reportable segments. (in thousands) Three Months Ended Six Months Ended June 30, 2023 June 30, 2022 June 30, 2023 June 30, 2022 Sales Wireless $ 6,329 $ 7,243 $ 12,901 $ 15,009 Telco 5,759 20,546 13,906 36,539 Total sales $ 12,088 $ 27,789 $ 26,807 $ 51,548 Gross profit Wireless $ 1,786 $ 1,974 $ 3,131 $ 3,511 Telco 1,486 6,173 3,558 10,394 Total gross profit $ 3,272 $ 8,147 $ 6,689 $ 13,905 Income (loss) from operations Wireless $ (1,676) $ (1,461) $ (3,780) $ (3,659) Telco (624) 2,606 (1,073) 3,640 Total income (loss) from operations $ (2,300) $ 1,145 $ (4,853) $ (19) (in thousands) June 30, 2023 December 31, 2022 Segment assets Wireless $ 6,260 $ 9,790 Telco 10,952 13,217 Non-allocated 3,761 4,211 Total assets $ 20,973 $ 27,218 |
Going Concern Assessment (Detai
Going Concern Assessment (Details) $ in Millions | Jun. 30, 2023 USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Current liabilities exceeded the current assets | $ (4.2) |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | |||||
Sales | $ 12,088 | $ 27,789 | $ 26,807 | $ 51,548 | |
Contract assets | 1,831 | 1,831 | $ 5,005 | ||
Contract liabilities | 349 | 349 | $ 148 | ||
Contract liabilities, revenue recognized | $ 100 | ||||
Customer Concentration Risk | Revenue Benchmark | Two Customers | |||||
Disaggregation of Revenue [Line Items] | |||||
Consolidate revenues, percentage of sales | 31% | 33% | |||
Non-US | |||||
Disaggregation of Revenue [Line Items] | |||||
Sales | $ 1,200 | $ 2,000 | $ 2,800 | $ 3,600 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total sales | $ 12,088 | $ 27,789 | $ 26,807 | $ 51,548 |
Wireless services sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Total sales | 6,329 | 7,243 | 12,901 | 15,009 |
Telco equipment | Telco equipment | ||||
Disaggregation of Revenue [Line Items] | ||||
Total sales | 5,750 | 20,346 | 13,897 | 36,333 |
Telco repair | Telco equipment | ||||
Disaggregation of Revenue [Line Items] | ||||
Total sales | 9 | 8 | 9 | 14 |
Telco recycle | Telco equipment | ||||
Disaggregation of Revenue [Line Items] | ||||
Total sales | $ 0 | $ 192 | $ 0 | $ 192 |
Accounts Receivable Agreements
Accounts Receivable Agreements (Details) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2023 USD ($) facility | Dec. 17, 2023 facility | Dec. 31, 2022 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable agreement reserve of sold receivables, increase period | 120 days | ||
Line of credit facility, number of lines of credit facilities | facility | 4 | ||
Line of credit, maximum borrowing capacity | $ 19,000 | ||
Restricted cash | $ 739 | $ 1,101 | |
Certain Receivables to Unrelated Third-parties | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable agreement percent of sold receivables advanced, deduction | 1.75% | ||
Accounts receivable agreement number of facilities | facility | 4 | ||
Accounts receivable agreement, percent of sold receivables advanced | 90% | ||
Accounts receivable agreement, reserve of sold receivables, percent | 10% | ||
Accounts receivable agreement percent of sold receivables final percentage | 100% | ||
Certain Receivables to Unrelated Third-parties | Other Nonoperating Income (Expense) | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Proceeds from collection of finance receivables | $ 22,800 | ||
Cost of selling receivables | 400 | ||
Certain Receivables to Unrelated Third-parties | Forecast | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Accounts receivable agreement number of facilities | facility | 4 | ||
Certain Receivables to Unrelated Third-parties | Customer One | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum credit purchase capacity | $ 3,000 | ||
Accounts receivable sales percentage | 2% | ||
Certain Receivables to Unrelated Third-parties | Customer Two | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum credit purchase capacity | $ 3,000 | ||
Accounts receivable sales percentage | 1.60% | ||
Uncollectible Receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Thirty party financial institution reserve | $ 3,100 | ||
Nave | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum credit purchase capacity | 10,000 | ||
Triton | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Maximum credit purchase capacity | $ 3,000 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventory (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Inventory [Line Items] | ||
Allowance for excess and obsolete inventory | $ (4,097) | $ (3,871) |
Total inventories, net | 8,076 | 9,563 |
New equipment | ||
Inventory [Line Items] | ||
Inventory, gross | 1,976 | 2,286 |
Refurbished and used equipment | ||
Inventory [Line Items] | ||
Inventory, gross | $ 10,197 | $ 11,148 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 5,277 | $ 5,277 |
Accumulated Amortization | (4,728) | (4,568) |
Net | $ 549 | $ 709 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 10 years | 10 years |
Gross | $ 3,155 | $ 3,155 |
Accumulated Amortization | (2,966) | (2,913) |
Net | $ 189 | $ 242 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 10 years | 10 years |
Gross | $ 2,122 | $ 2,122 |
Accumulated Amortization | (1,762) | (1,655) |
Net | $ 360 | $ 467 |
Debt (Details)
Debt (Details) - USD ($) $ / shares in Units, shares in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
May 01, 2023 | Apr. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2023 | Mar. 17, 2022 | |
Debt Instrument [Line Items] | |||||
Line of credit, maximum borrowing capacity | $ 19,000,000 | $ 19,000,000 | |||
Commitment fee payable in shares (in shares, up to) | 72 | ||||
Price triggering shareholders' meeting (In dollars per share) | $ 1 | $ 1 | |||
Consecutive days of certain price to trigger shareholders' meeting | 5 years | ||||
Consecutive period of trading under 1 dollar | 5 days | ||||
Warrants With 2.5$ Exercise Price | |||||
Debt Instrument [Line Items] | |||||
Number of warrants issuable (in shares) | 360 | ||||
Exercise price of warrants (in dollars per share) | $ 2.50 | ||||
Warrant exercise period | 5 years | ||||
Warrants With 1.4$ Exercise Price | |||||
Debt Instrument [Line Items] | |||||
Number of warrants issuable (in shares) | 288 | ||||
Exercise price of warrants (in dollars per share) | $ 1.40 | ||||
Warrant exercise period | 5 years | ||||
Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 3,000,000 | ||||
Debt instrument, interest rate | 13% | ||||
Minimum market capitalization | $ 5,000,000 | ||||
Unamortized discount and debt issuance costs | 300,000 | $ 300,000 | |||
Amortization of debt issuance costs | 300,000 | ||||
Repayments of long-term debt | 200,000 | ||||
Outstanding amount | $ 2,200,000 | $ 2,200,000 | |||
Convertible Notes Issued April 2023 | Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Debt instrument original issue discount | 200,000 | ||||
Convertible Notes Issued April 2023 | Mast Hill Fund, L.P. (The Purchaser) | Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Long-term debt, total | $ 2,800,000 | ||||
Revolving Credit Facility | New Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Line of credit, maximum borrowing capacity | $ 3,000,000 |
Equity Distribution Agreement_2
Equity Distribution Agreement and Sale of Common Stock (Details) - USD ($) | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Apr. 24, 2020 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Commission rate | 3% | |||
Proceeds from sale of common stock, gross | $ 0 | $ 206,000 | ||
Sales Agreement With Northland | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Common stock, par value (in dollars per share) | $ 0.01 | |||
Maximum aggregate offering price | $ 13,900,000 | |||
Issuance of common shares (in shares) | 0 | 174,730 | ||
Proceeds from issuance of common stock gross | $ 200,000 | |||
Proceeds from sale of common stock, gross | $ 200,000 |
Earnings Per Share - Basic and
Earnings Per Share - Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Earnings Per Share [Abstract] | ||||||
Net income (loss) attributable to common shareholders | $ (2,834) | $ (2,748) | $ 875 | $ (1,394) | $ (5,581) | $ (519) |
Basic weighted average shares (in shares) | 13,999,816 | 13,191,792 | 13,638,538 | 13,131,754 | ||
Diluted weighted average shares (in shares) | 13,999,816 | 13,191,792 | 13,638,538 | 13,131,754 | ||
Basic loss per common share (in dollars per share) | $ (0.20) | $ 0.07 | $ (0.41) | $ (0.04) | ||
Diluted loss per common share (in dollars per share) | $ (0.20) | $ 0.07 | $ (0.41) | $ (0.04) |
Earnings Per Share - Anti-dilut
Earnings Per Share - Anti-dilutive Securities (Details) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Securities excluded (in shares) | 0 | 50,000 | 0 | 50,000 |
Weighted average exercise price of stock options (in dollars per share) | $ 1.28 | $ 1.28 | ||
Average market price of common stock (in dollars per share) | $ 1.27 | $ 1.29 | ||
Restricted Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Securities excluded (in shares) | 897,490 | 0 | 897,490 | 0 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Supplemental cash flow information: | ||
Cash paid for interest | $ 378 | $ 99 |
Cash paid for taxes | 16 | 0 |
Supplemental noncash investing and financing activities: | ||
Assets acquired under financing leases | 0 | 281 |
Common stock and warrants issued in conjunction with the issuance of convertible debt | $ 384 | $ 0 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation expense | $ 0.2 | $ 0.1 | $ 0.6 | $ 0.4 |
Compensation cost, not yet recognized | $ 0.6 | $ 0.6 | ||
Recognized over a period | 3 years | |||
The 2015 Incentive Stock Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock, capital shares reserved for future issuance (in shares) | 3,100,415 | 3,100,415 | ||
Number of shares available for grant (in shares) | 333,813 | 333,813 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Non-vested Restricted Share Awards (Details) $ in Thousands | 3 Months Ended |
Jun. 30, 2023 USD ($) shares | |
Shares | |
Nonvested, beginning balance (in shares) | shares | 912,883 |
Granted (in shares) | shares | 95,000 |
Vested (in shares) | shares | (97,060) |
Forfeited (in shares) | shares | (13,333) |
Nonvested, ending balance (in shares) | shares | 897,490 |
Fair Value | |
Non-vested, beginning balance (in dollars per share) | $ | $ 1,403 |
Granted (in dollars per share) | $ | 80 |
Vested (in dollars per share) | $ | (138) |
Forfeited (in dollars per share) | $ | (34) |
Non-vested, ending balance (in dollars per share) | $ | $ 1,311 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 USD ($) carrier | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) carrier | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of U.S. wireless carriers | carrier | 4 | 4 | |||
Sales | $ 12,088 | $ 27,789 | $ 26,807 | $ 51,548 | |
Gross profit | 3,272 | 8,147 | 6,689 | 13,905 | |
Income (loss) from operations | (2,300) | 1,145 | (4,853) | (19) | |
Segment assets | 20,973 | 20,973 | $ 27,218 | ||
Operating segments | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 12,088 | 27,789 | 26,807 | 51,548 | |
Income (loss) from operations | (2,300) | 1,145 | (4,853) | (19) | |
Non-allocated | |||||
Segment Reporting Information [Line Items] | |||||
Segment assets | 3,761 | 3,761 | 4,211 | ||
Wireless | Operating segments | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 6,329 | 7,243 | 12,901 | 15,009 | |
Gross profit | 1,786 | 1,974 | 3,131 | 3,511 | |
Income (loss) from operations | (1,676) | (1,461) | (3,780) | (3,659) | |
Segment assets | 6,260 | 6,260 | 9,790 | ||
Telco | Operating segments | |||||
Segment Reporting Information [Line Items] | |||||
Sales | 5,759 | 20,546 | 13,906 | 36,539 | |
Gross profit | 1,486 | 6,173 | 3,558 | 10,394 | |
Income (loss) from operations | (624) | $ 2,606 | (1,073) | $ 3,640 | |
Segment assets | $ 10,952 | $ 10,952 | $ 13,217 |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event | Aug. 09, 2023 USD ($) facility qtr |
Subsequent Event [Line Items] | |
Number of quarters with reduced sales | qtr | 2 |
Number of facilities | facility | 4 |
Nave | |
Subsequent Event [Line Items] | |
Maximum borrowing capacity | $ 5,000,000 |
Triton | |
Subsequent Event [Line Items] | |
Maximum borrowing capacity | 1,500,000 |
Fulton Facility, Excluding Major Customer | |
Subsequent Event [Line Items] | |
Maximum borrowing capacity | 6,000,000 |
Fulton Facility, Major Customer | |
Subsequent Event [Line Items] | |
Maximum borrowing capacity | $ 1,500,000 |