Servotronics (SVT) 10-Q 13 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 31, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	SERVOTRONICS INC /DE/
Entity Central Index Key	89,140
Trading Symbol	svt
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		2,582,773
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3
Entity Small Business	true
Entity Emerging Growth Company	false

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Current assets:
Cash	$ 2,379	$ 4,707
Accounts receivable, net	10,780	8,424
Inventories, net	14,651	12,791
Other current assets	495	249
Total current assets	28,305	26,171
Property, plant and equipment, net	11,713	11,021
Deferred income taxes	409	409
Other non-current assets	376	385
Total Assets	40,803	37,986
Current liabilities:
Current portion of long-term debt	548	548
Current portion of capitalized lease obligations	175	133
Dividend payable	13
Accounts payable	2,579	1,377
Accrued employee compensation and benefits costs	1,746	1,784
Accrued income taxes	121	414
Other accrued liabilities	924	872
Total current liabilities	6,106	5,128
Long-term debt	2,589	2,950
Post retirement obligation	1,828	1,743
Shareholders' equity:
Common stock, par value $0.20; authorized 4,000,000 shares; issued 2,614,506 shares; outstanding 2,498,870 (2,308,315 - 2017) shares	523	523
Capital in excess of par value	14,226	14,171
Retained earnings	17,785	15,709
Accumulated other comprehensive loss	(26)	(32)
Employee stock ownership trust commitment	(662)	(662)
Treasury stock, at cost 115,636 (183,983 - 2017) shares	(1,566)	(1,544)
Total shareholders' equity	30,280	28,165
Total Liabilities and Shareholders' Equity	$ 40,803	$ 37,986

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Statement Of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.20	$ 0.20
Common stock, shares authorized	4,000,000	4,000,000
Common stock, shares issued	2,614,506	2,614,506
Common stock, shares outstanding	2,498,870	2,308,315
Treasury stock, shares	115,636	183,983

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Revenue	$ 12,768	$ 11,325	$ 35,273	$ 30,044
Costs and expenses:
Costs of goods sold, inclusive of depreciation and amortization	8,828	8,234	26,359	23,307
Gross margin	$ 3,940	$ 3,091	$ 8,914	$ 6,737
Gross margin %	30.90%	27.30%	25.30%	22.40%
Selling, general and administrative	$ 2,074	$ 2,085	$ 5,715	$ 5,548
Interest expense	28	18	80	56
Total expenses	10,930	10,337	32,154	28,911
Income before income tax provision	1,838	988	3,119	1,133
Income tax provision	381	317	624	331
Net income	$ 1,457	$ 671	$ 2,495	$ 802
Basic
Net Income per share	$ 0.63	$ 0.30	$ 1.10	$ 0.35
Diluted
Net income per share	$ 0.61	$ 0.29	$ 1.07	$ 0.35

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Cash flows related to operating activities:
Net Income	$ 2,495	$ 802
Adjustments to reconcile net income to net cash (used) provided by operating activities:
Depreciation and amortization	761	637
Loss on disposal of property	1	16
Stock based compensation	183	176
Increase in allowance for doubtful accounts	49	72
Increase in inventory reserve	54	43
Increase in warranty reserve	369
Change in assets and liabilities:
Accounts receivable	(2,405)	(1,733)
Inventories	(1,914)	257
Prepaid income taxes		(181)
Other current assets	(246)	24
Other non-current assets	9	(9)
Accounts payable	1,202	(88)
Accrued employee compensation and benefit costs	(38)	469
Other accrued liabilities and post retirement obligation	(231)	254
Accrued income taxes	(293)
Net cash (used) provided by operating activities	(4)	739
Cash flows related to investing activities:
Capital expenditures - property, plant and equipment	(1,452)	(1,401)
Proceeds from sale of assets		180
Net cash (used) by investing activities	(1,452)	(1,221)
Cash flows related to financing activities:
Principal payments on long-term debt	(410)	(409)
Principal payments on capital lease obligations	(119)
Proceeds from capital leases	210
Purchase of treasury shares	(150)	(203)
Cash dividend	(403)	(376)
Net cash (used) by financing activities	(872)	(988)
Net decrease in cash	(2,328)	(1,470)
Cash at beginning of period	4,707	3,515
Cash at end of period	$ 2,379	$ 2,045

Basis of Presentation

Basis of Presentation	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements (“consolidated financial statements”) have been prepared in accordance with United States generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by United States generally accepted accounting principles for complete financial statements. The accompanying consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods presented. All such adjustments are of a normal recurring nature. Operating results for the three and nine months ended September 30, 2018 are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The consolidated financial statements should be read in conjunction with the 2017 annual report and the notes thereto.

Business Description and Summar

Business Description and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Business Description and Summary of Significant Accounting Policies	2. Business Description and Summary of Significant Accounting Policies Business Description Servotronics, Inc. and its subsidiaries design, manufacture and market advanced technology products consisting primarily of control components, and consumer products consisting of knives and various types of cutlery and other edged products. Principles of Consolidation The consolidated financial statements include the accounts of Servotronics, Inc. and its wholly-owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated upon consolidation. Cash The Company considers cash to include all checking, savings and money market accounts. Accounts Receivable The Company grants credit to substantially all of its customers and carries its accounts receivable at original invoice amount less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on history of past write-offs, collections, and current credit conditions. The allowance for doubtful accounts amounted to approximately $198,000 at September 30, 2018 and $149,000 at December 31, 2017. The Company does not accrue interest on past due receivables. Revenue Recognition Revenues are recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Purchase orders generally include specific terms relative to quantity, item description, specifications, price, customer responsibility for in-process costs, delivery schedule, shipping point, payment and other standard terms and conditions of purchase. Service sales, principally representing repair, are recognized at the time of shipment of goods. The costs incurred for nonrecurring engineering, development and repair activities of our products under agreements with commercial customers are expensed as incurred. Subsequently, the revenue is recognized as products are delivered to the customers with the approval by the customers. Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods and services to a customer. The Company determines revenue recognition using the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when the company satisfies a performance obligation. Revenue excludes taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer (e.g., sales and use taxes). Revenue includes payments for shipping activities that are reimbursed by the customer to the Company. Revenue on a significant portion of our contracts is currently recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Performance obligations are satisfied as of a point in time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract. As a significant portion of the Company’s revenue are recognized at the time of shipment, transfer of title and customer acceptance, there is no significant judgment applied to determine the timing of the satisfaction of performance obligations or transaction price. The timing of satisfaction of our performance obligations does not significantly vary from the typical timing of payment. The Company generally receives payment for these contracts within the payment terms negotiated and agreed upon by each customer contract. Warranty and repair obligations are assessed on all returns. Revenue is not recorded on any warranty returns. The Company warrants its products against design, materials and workmanship based on an average of twenty-seven months. The Company determines warranty reserves needed based on actual average costs of warranty units shipped and current facts and circumstances. As of September 30, 2018 and December 31, 2017 the Company has recorded a warranty reserve of approximately $408,000 and $39,000, respectively. Revenue is recognized on repair returns, covered under a customer contract, at the contractual price upon shipment to the customer. Inventories Inventories are stated at the lower of cost or net realizable value. Cost includes all costs incurred to bring each product to its present location and condition. Market provisions in respect of lower of cost or market adjustments and inventory expected to be used in greater than one year are applied to the gross value of the inventory through a reserve of approximately $1,492,000 and $1,438,000 at September 30, 2018 and December 31, 2017, respectively. Pre-production and start-up costs are expensed as incurred. The purchase of suppliers’ minimum economic quantities of material such as steel, etc. may result in a purchase of quantities exceeding one year of customer requirements. Also, in order to maintain a reasonable and/or agreed to lead time, certain larger quantities of other product support items may have to be purchased and may result in over one year’s supply. These amounts are not included in the inventory reserve discussed above. Shipping and Handling Costs Shipping and handling costs are classified as a component of cost of goods sold. Property, Plant and Equipment Property, plant and equipment is carried at cost; expenditures for new facilities and equipment and expenditures which substantially increase the useful lives of existing plant and equipment are capitalized; expenditures for maintenance and repairs are expensed as incurred. Upon disposal of properties, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposition is included in income. Depreciation is provided on the basis of estimated useful lives of depreciable properties, primarily by the straight-line method for financial statement purposes and by accelerated methods for income tax purposes. Depreciation expense includes the amortization of capital lease assets. The estimated useful lives of depreciable properties are generally as follows: Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3-5 years Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, as well as operating loss and credit carryforwards. The Company and its subsidiaries file a consolidated federal income tax return, combined New York and Texas state income tax returns and separate Pennsylvania and Arkansas income tax returns. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at September 30, 2018 or December 31, 2017, and did not recognize any interest and/or penalties in its consolidated statements of income during the nine months ended September 30, 2018 and 2017. The Company did not have any material uncertain tax positions or unrecognized tax benefits or obligations as of September 30, 2018 and December 31, 2017. The 2015 through 2017 federal and state tax returns remain subject to examination. Supplemental Cash Flow Information Income taxes paid during the nine months ended September 30, 2018 and 2017 amounted to approximately $875,000 and $165,000, respectively. Interest paid amounted to approximately $ , respectively, during the nine months ended September 30, 2018 and 2017. Equipment received but not placed in service and included in accounts payable at September 30, 2017 amounted to approximately $508,000. Employee Stock Ownership Plan Contributions to the employee stock ownership plan are determined annually by the Company according to plan formula. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable based on undiscounted future operating cash flow analyses. If an impairment is determined to exist, any related impairment loss is calculated based on fair value. Impairment losses on assets to be disposed of, if any, are based on the estimated proceeds to be received, less costs of disposal. The Company has determined that no impairment of long-lived assets existed at September 30, 2018 and December 31, 2017. Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications Certain balances, as previously reported, were reclassified to conform with classifications adopted in the current period. Research and Development Costs Research and development costs are expensed as incurred. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks principally consist of cash accounts in financial institutions. Although the accounts exceed the federally insured deposit amount, management does not anticipate nonperformance by the financial institutions. Fair Value of Financial Instruments Accounts receivable, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. Based on variable interest rates and the borrowing rates currently available to the Company for loans similar to its long-term debt, the fair value approximates its carrying amount. Recent Accounting Pronouncements Adopted Effective January 1, 2018 the Company adopted ASU 2017-07, “Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” issued by the Financial Accounting Standards Board (FASB) which requires employers to present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. The other components of net periodic benefit cost will be presented separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. ASU 2017-07 allows a practical expedient that permits an entity to use amounts disclosed in its pension and other post retirement requirements. The Company adopted this guidance during the reporting period. The reporting of the annual service costs is expected to be immaterial. Effective January 1, 2018, the Company adopted ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)" using the modified retrospective method. The new revenue recognition standard outlines a comprehensive model for companies to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. Topic 606 also requires significantly expanded disclosure requirements and applied the standard to all contracts that were not completed as of January 1, 2018. There was no cumulative effect of the adoption recognized. We have obtained an understanding of the new standard and determined that there is no material change in our revenue recognition after implementation of the standard. See above for the Company’s updated revenue recognition accounting policy. Effective January 1, 2018, the Company adopted Recent Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” There are elements of the new standard that could impact almost all entities to some extent, although the lessees will likely see the most significant changes. Lessee will need to recognize virtually all of their leases on the balance sheet, by recording the right-of-use asset and a lease liability. Public business entities are required to adopt the new leasing standard for fiscal years, and interim period within those fiscal years, beginning December 15, 2018. For calendar year-end public companies, this means an adoption date of January 1, 2019. Early adoption is permitted. The Company does not believe the adoption will have a material impact on the financial statements and disclosures.

Inventories

Inventories	9 Months Ended
	Sep. 30, 2018
Inventory Disclosure [Abstract]
Inventories	3. Inventories September 30, December 31, 2018 2017 ($000's omitted) Raw material and common parts $ 8,641 $ 8,375 Work-in-process 4,937 2,940 Finished goods 2,565 2,914 16,143 14,229 Less inventory reserve (1,492 ) (1,438 ) Total inventories $ 14,651 $ 12,791

Property, Plant and Equipment

Property, Plant and Equipment	9 Months Ended
	Sep. 30, 2018
Property, Plant and Equipment [Abstract]
Property, Plant and Equipment	4. Property, Plant and Equipment September 30, December 31, 2018 2017 ($000's ommitted) Land $ 7 $ 7 Buildings 10,887 10,288 Machinery, equipment and tooling 17,815 17,249 Construction in progress 931 665 29,640 28,209 Less accumulated depreciation (17,927 ) (17,188 ) $ 11,713 $ 11,021 Depreciation and amortization expense amounted to approximately $259,000 and $209,000 for the three months ended September 30, 2018 and 2017, respectively. Depreciation expense amounted to approximately $704,00 and $ for the nine months ended September 30, 2018 and 2017, respectively. Depreciation expense amounted to approximately $239,000 and $206,000 for the three months ended September 30, 2018 and 2017, respectively. Amortization expense primarily related to capital leases amounted to approximately $57,000 and $9,000 for the nine months ended September 30, 2018 and September 30, 2017, respectively. Amortization expense amounted to approximately $20,000 and $3,000 for the three months ended September 30, 2018 and September 30, 2017, respectively. The Company maintains property and casualty insurance in amounts adequate for the risk and nature of its assets and operations and which are generally customary in its industry. As of September 30, 2018, there is approximately $931,000 ($665,000 – 2017) of construction in progress (CIP) included in property, plant and equipment all of which is related to capital projects. There is approximately $556,000 in CIP for the implementation costs for the enterprise resource planning software that will be used as an integral part of the product process at the Advanced Technology Group (“ATG”) and the Consumer Products Group (“CPG”) and approximately $240,000 for machinery received but not placed in service at both the ATG and CPG with the remainder of approximately $135,000 of self-constructed assets not yet put into service. See Note 7, Commitments and Contingencies, for more information on anticipated capital expenditures.

Long-Term Debt

Long-Term Debt	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
Long-Term Debt	5. Long-Term Debt September 30, December 31, 2018 2017 ($000's omitted) Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513 $ 1,638 $ 1,835 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513 929 1,142 Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months) 745 654 3,312 3,631 Less current portion (723 ) (681 ) $ 2,589 $ 2,950 The Company has a $2,000,000 line of credit on which there was no balance outstanding at September 30, 2018 and December 31, 2017. The term loans are secured by all personal property of the Company with the exception of certain equipment that was purchased from proceeds of government grants. Certain lenders require the Company to comply with debt covenants as described in the specific loan documents, including a debt service ratio. At September 30, 2018 and December 31, 2017 the Company was in compliance with these covenants. The Company established a lease line of credit for equipment financing in the amount of $1,000,000 with initial borrowings available until June 28, 2018. This line is non-revolving and non-renewable. The lease term for equipment covered by the lease line of credit is 60 months, with a $1 buy out at the end of the term. Monthly payments will be fixed for the term of each funding based upon the Lender’s lease pricing in effect at the time of such funding. Principal payments for the capital lease obligations at September 30, 2018 and December 31, 2017 was approximately $119,000 and $14,000, respectively. Remaining principal payments for the capital lease obligations are expected for 2018 and for each of the next five years: September 30, 2018 ($000's omitted) 2018 $ 47 2019 193 2020 193 2021 193 2022 193 2023 2 Total minimum lease payments 821 Less amount representing interest (76 ) Present value of net minimum lease payments 745 Less current portion (175 ) Long term principle payments $ 570 Each lease is secured by the underlying equipment. There was approximately $822,000 outstanding payments, principal including interest, at September 30, 2018.

Shareholders' Equity

Shareholders' Equity	9 Months Ended
	Sep. 30, 2018
Equity [Abstract]
Shareholders' Equity	6. Shareholders’ Equity Common Stock ($000's omitted except for share data) Accumulated Number Capital in Other Total of shares excess of Retained Treasury Comprehensive shareholders' issued Amount par value earnings ESOT stock Loss equity Balance at December 31, 2017 2,614,506 $ 523 $ 14,171 $ 15,709 $ (662 ) $ (1,544 ) $ (32 ) $ 28,165 Net income - - - 2,495 - - - 2,495 Purchase of treasury shares - - - - - (150 ) - (150 ) Cash dividend - - - (413 ) - - - (413 ) Stock based compensation, net of tax benefit - - 55 (6 ) - 128 6 183 Balance at September 30, 2018 2,614,506 $ 523 $ 14,226 $ 17,785 $ (662 ) $ (1,566 ) $ (26 ) $ 30,280 The Company’s Board of Directors authorized the purchase of up to 450,000 shares of its common stock in the open market or in privately negotiated transactions. As of September 30, 2018, the Company has purchased 352,680 shares and there remains 97,320 shares available to purchase under this program. There were 3,350 shares purchased by the Company during the nine month period ended September 30, 2018. On January 1, 2018, 28,500 shares of restricted stock vested of which shares were withheld and repurchased by the Company for approximately $117,000 to satisfy statutory minimum withholding tax requirements for those participants who elected this option as permitted under the Company’s 2012 Long-Term Incentive Plan. On May 25, 2018, the Company issued 78,750 shares of restricted stock to Executive Officers and certain key management of the Company under the Company’s 2012 Long-Term Incentive Plan. The restricted share awards have varying vesting periods between January 2019 and January 2021; however, these shares have voting rights and accrue dividends prior to vesting. The accrued dividends are paid upon vesting of the restricted shares. The aggregate amount of expense to the Company, measured based on grant date fair value is expected to be approximately $735,000 and will be recognized over the requisite service period. On May 25, 2018, the Company revised its director compensation policy pursuant to which non-employee directors receive a portion of their annual retainer in the form of restricted stock under the Company’s 2012 Long-Term Incentive Plan. An aggregate of 4,288 restricted shares were issued that vest quarterly over a twelve month service period. These shares have voting rights and accrue dividends that are paid upon vesting. The aggregate amount of expense to the Company, measured based on the grant date fair value is expected to be approximately $40,000 and will be recognized over the requisite service period. Included in the nine months ended September 30, 2018 and 2017 is approximately $183,000 and $176,000, respectively, of stock-based compensation expense related to the restrictive share awards. On May 18, 2018 the Company announced that its Board of Directors declared a $0.16 per share cash dividend. The dividend was subsequently paid on July 16, 2018 to shareholders of record on June 30, 2018 and was approximately $413,000 in the aggregate. These dividends do not represent that the Company will pay dividends on a regular or scheduled basis. The amount is recorded in dividends payable and as a reduction to retained earnings on the accompanying consolidated balance sheet. Earnings Per Share Basic earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period. The weighted average number of common shares outstanding does not include any potentially dilutive securities or any unvested restricted shares of common stock. These unvested restricted shares, although classified as issued and outstanding, are considered forfeitable until the restrictions lapse and will not be included in the basic EPS calculation until the shares are vested. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period plus the number of shares of common stock that would be issued assuming all contingently issuable shares having a dilutive effect on the earnings per share that were outstanding for the period. Incremental shares from assumed conversions are calculated as the number of shares that would be issued, net of the number of shares that could be purchased in the marketplace with the cash received upon stock option exercise. The dilutive effect of unvested restrictive stock is determined using the treasury stock method. Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 ($000's omitted except per share data) Net Income $ 1,457 $ 671 $ 2,495 $ 802 Weighted average common shares outstanding (basic) 2,295 2,262 2,259 2,264 Unvested restricted stock 82 29 82 29 Weighted average common shares outstanding (diluted) 2,377 2,291 2,341 2,293 Basic Net income per share $ 0.63 $ 0.30 $ 1.10 $ 0.35 Diluted Net income per share $ 0.61 $ 0.29 $ 1.07 $ 0.35

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	7. Commitments and Contingencies Post retirement obligation. The Company provides certain post-employment health and life insurance benefits for its Chief Executive Officer and President Kenneth Trbovich. Upon retirement and after attaining at least the age of 65, the Company will pay for the retired Executive’s and dependent’s health benefits and will continue the Company-provided life insurance offered at the time of retirement. The retiree’s health insurance benefits ceases upon the death of the retired executive. Approximately $821,000 and $736,000 has been accrued as of September 30, 2018 and December 31, 2017, respectively, and is reflected as Post Retirement Obligation in the accompanying balance sheet. Facility Expansion. The Company’s Consumer Products Group (“CPG”) was awarded a $300,000 grant from Cattaraugus County Industrial Development Agency (“CCIDA”) on March 13, 2014. The grant was used towards new manufacturing equipment in connection with the proposed expansion project. As part of the terms of the Grant Contract with CCIDA, the Company’s CPG has agreed to maintain certain employment levels for a period of five years from the date of the agreement. If the employment levels are not maintained, the Company will be required to repay the grant proceeds on a prorated basis. The Company has maintained the required employment levels as of September 30, 2018.

Litigation

Litigation	9 Months Ended
	Sep. 30, 2018
Litigation [Abstract]
Litigation	8. Litigation Litigation. There are no other legal proceedings currently pending by or against the Company other than ordinary routine litigation incidental to the business which is not expected to have a material adverse effect on the business or earnings of the Company.

Related Party Transactions

Related Party Transactions	9 Months Ended
	Sep. 30, 2018
Related Party Transactions [Abstract]
Related Party Transactions	9. Related Party Transactions The Company paid legal fees and disbursements of approximately $117,000 and $188,000 in the nine month period ended September 30, 2018 and 2017, respectively, for services provided by a law firm that is owned by a member of the Company’s Board of Directors. Legal fees paid for the three month period ended September 30, 2018 and 2017 amounted to approximately $23,000 and $44,000, respectively. Additionally, the Company had accrued unbilled legal fees at September 30, 2018 and 2017 of approximately $19,000 and $39,000, respectively, with this firm.

Business Segments

Business Segments	9 Months Ended
	Sep. 30, 2018
Segment Reporting [Abstract]
Business Segments	10. Business Segments The Company operates in two business segments, ATG and CPG. The Company’s reportable segments are strategic business units that offer different products and services. The segments are composed of separate corporations and are managed separately. Operations in ATG primarily involve the design, manufacture, and marketing of servo-control components (i.e., torque motors, control valves, actuators, etc.) for government, commercial and industrial applications. CPG’s operations involve the design, manufacture and marketing of a variety of cutlery products for use by consumers and government agencies. The Company derives its primary sales revenue from domestic customers, although a portion of finished products are for foreign end use. As of September 30, 2018, the Company had identifiable assets of approximately $40,803,000 ($37,986,000 – December 31, 2017) of which approximately $29,896,000 ($26,331,000 – December 31, 2017) was for ATG and approximately $10,907,000 ($11,655,000 – December 31, 2017) was for CPG. Information regarding the Company’s operations in these segments is summarized as follows: ($000's omitted) ATG CPG Consolidated Nine Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, 2018 2017 2018 2017 2018 2017 Revenues from unaffiliated customers $ 30,028 $ 23,968 $ 5,245 $ 6,076 $ 35,273 $ 30,044 Cost of goods sold, inclusive of depreciation and amortization (21,600 ) (17,826 ) (4,759 ) (5,481 ) (26,359 ) (23,307 ) Gross margin 8,428 6,142 486 595 8,914 6,737 Gross margin % 28.1 % 25.6 % 9.3 % 9.8 % 25.3 % 22.4 % Selling, general and administrative (4,131 ) (4,148 ) (1,584 ) (1,400 ) (5,715 ) (5,548 ) Interest expense (55 ) (32 ) (25 ) (24 ) (80 ) (56 ) Total expenses (25,786 ) (22,006 ) (6,368 ) (6,905 ) (32,154 ) (28,911 ) Income (loss) before income tax provision (benefits) 4,242 1,962 (1,123 ) (829 ) 3,119 1,133 Income tax provision (benefits) 849 580 (225 ) (249 ) 624 331 Net income (loss) $ 3,393 $ 1,382 $ (898 ) $ (580 ) $ 2,495 $ 802 Capital expenditures $ 1,277 $ 1,777 $ 175 $ 124 $ 1,452 $ 1,901 ($000's omitted) ATG CPG Consolidated Three Months Ended Three Months Ended Three Months Ended September 30, September 30, September 30, 2018 2017 2018 2017 2018 2017 Revenues from unaffiliated customers $ 10,639 $ 8,918 $ 2,129 $ 2,407 $ 12,768 $ 11,325 Cost of goods sold, inclusive of depreciation and amortization (6,965 ) (6,198 ) (1,863 ) (2,036 ) (8,828 ) (8,234 ) Gross margin 3,674 2,720 266 371 3,940 3,091 Gross margin % 34.5 % 30.5 % 12.5 % 15.4 % 30.9 % 27.3 % Selling, general and administrative (1,476 ) (1,642 ) (598 ) (443 ) (2,074 ) (2,085 ) Interest expense (20 ) (9 ) (8 ) (9 ) (28 ) (18 ) Total expenses (8,461 ) (7,849 ) (2,469 ) (2,488 ) (10,930 ) (10,337 ) Income (loss) before income tax provision (benefits) 2,178 1,069 (340 ) (81 ) 1,838 988 Income tax provision (benefits) 457 341 (76 ) (24 ) 381 317 Net income (loss) $ 1,721 $ 728 $ (264 ) $ (57 ) $ 1,457 $ 671 Capital expenditures $ 432 $ 1,282 $ 36 $ 48 $ 468 $ 1,330

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2018
Subsequent Events [Abstract]
Subsequent Events	11. Subsequent Events None.

Business Description and Summ_2

Business Description and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Principles of Consolidation	Principles of Consolidation The consolidated financial statements include the accounts of Servotronics, Inc. and its wholly-owned subsidiaries (the “Company”). All intercompany balances and transactions have been eliminated upon consolidation.
Cash	Cash The Company considers cash to include all checking, savings and money market accounts.
Accounts Receivable	Accounts Receivable The Company grants credit to substantially all of its customers and carries its accounts receivable at original invoice amount less an allowance for doubtful accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on history of past write-offs, collections, and current credit conditions. The allowance for doubtful accounts amounted to approximately $198,000 at September 30, 2018 and $149,000 at December 31, 2017. The Company does not accrue interest on past due receivables.
Revenue Recognition	Revenue Recognition Revenues are recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Purchase orders generally include specific terms relative to quantity, item description, specifications, price, customer responsibility for in-process costs, delivery schedule, shipping point, payment and other standard terms and conditions of purchase. Service sales, principally representing repair, are recognized at the time of shipment of goods. The costs incurred for nonrecurring engineering, development and repair activities of our products under agreements with commercial customers are expensed as incurred. Subsequently, the revenue is recognized as products are delivered to the customers with the approval by the customers. Revenue is recognized at an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring goods and services to a customer. The Company determines revenue recognition using the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when the company satisfies a performance obligation. Revenue excludes taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction and collected by the Company from a customer (e.g., sales and use taxes). Revenue includes payments for shipping activities that are reimbursed by the customer to the Company. Revenue on a significant portion of our contracts is currently recognized at the time of shipment of goods, transfer of title and customer acceptance, as required. Our revenue transactions generally consist of a single performance obligation to transfer contracted goods and are not accounted for under industry-specific guidance. Performance obligations are satisfied as of a point in time. Performance obligations are supported by contracts with customers, providing a framework for the nature of the distinct goods, services or bundle of goods and services. The timing of satisfying the performance obligation is typically indicated by the terms of the contract. As a significant portion of the Company’s revenue are recognized at the time of shipment, transfer of title and customer acceptance, there is no significant judgment applied to determine the timing of the satisfaction of performance obligations or transaction price. The timing of satisfaction of our performance obligations does not significantly vary from the typical timing of payment. The Company generally receives payment for these contracts within the payment terms negotiated and agreed upon by each customer contract. Warranty and repair obligations are assessed on all returns. Revenue is not recorded on any warranty returns. The Company warrants its products against design, materials and workmanship based on an average of twenty-seven months. The Company determines warranty reserves needed based on actual average costs of warranty units shipped and current facts and circumstances. As of September 30, 2018 and December 31, 2017 the Company has recorded a warranty reserve of approximately $408,000 and $39,000, respectively. Revenue is recognized on repair returns, covered under a customer contract, at the contractual price upon shipment to the customer.
Inventories	Inventories Inventories are stated at the lower of cost or net realizable value. Cost includes all costs incurred to bring each product to its present location and condition. Market provisions in respect of lower of cost or market adjustments and inventory expected to be used in greater than one year are applied to the gross value of the inventory through a reserve of approximately $1,492,000 and $1,438,000 at September 30, 2018 and December 31, 2017, respectively. Pre-production and start-up costs are expensed as incurred. The purchase of suppliers’ minimum economic quantities of material such as steel, etc. may result in a purchase of quantities exceeding one year of customer requirements. Also, in order to maintain a reasonable and/or agreed to lead time, certain larger quantities of other product support items may have to be purchased and may result in over one year’s supply. These amounts are not included in the inventory reserve discussed above.
Shipping and Handling Costs	Shipping and Handling Costs Shipping and handling costs are classified as a component of cost of goods sold.
Property, Plant and Equipment	Property, Plant and Equipment Property, plant and equipment is carried at cost; expenditures for new facilities and equipment and expenditures which substantially increase the useful lives of existing plant and equipment are capitalized; expenditures for maintenance and repairs are expensed as incurred. Upon disposal of properties, the related cost and accumulated depreciation are removed from the respective accounts and any profit or loss on disposition is included in income. Depreciation is provided on the basis of estimated useful lives of depreciable properties, primarily by the straight-line method for financial statement purposes and by accelerated methods for income tax purposes. Depreciation expense includes the amortization of capital lease assets. The estimated useful lives of depreciable properties are generally as follows: Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3-5 years
Income Taxes	Income Taxes The Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities, as well as operating loss and credit carryforwards. The Company and its subsidiaries file a consolidated federal income tax return, combined New York and Texas state income tax returns and separate Pennsylvania and Arkansas income tax returns. The Company’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company did not have any accrued interest or penalties included in its consolidated balance sheets at September 30, 2018 or December 31, 2017, and did not recognize any interest and/or penalties in its consolidated statements of income during the nine months ended September 30, 2018 and 2017. The Company did not have any material uncertain tax positions or unrecognized tax benefits or obligations as of September 30, 2018 and December 31, 2017. The 2015 through 2017 federal and state tax returns remain subject to examination.
Supplemental Cash Flow Information	Supplemental Cash Flow Information Income taxes paid during the nine months ended September 30, 2018 and 2017 amounted to approximately $875,000 and $165,000, respectively. Interest paid amounted to approximately $ , respectively, during the nine months ended September 30, 2018 and 2017. Equipment received but not placed in service and included in accounts payable at September 30, 2017 amounted to approximately $508,000.
Employee Stock Ownership Plan	Employee Stock Ownership Plan Contributions to the employee stock ownership plan are determined annually by the Company according to plan formula.
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment annually or whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable based on undiscounted future operating cash flow analyses. If an impairment is determined to exist, any related impairment loss is calculated based on fair value. Impairment losses on assets to be disposed of, if any, are based on the estimated proceeds to be received, less costs of disposal. The Company has determined that no impairment of long-lived assets existed at September 30, 2018 and December 31, 2017.
Use of Estimates	Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Reclassifications	Reclassifications Certain balances, as previously reported, were reclassified to conform with classifications adopted in the current period.
Research and Development Costs	Research and Development Costs Research and development costs are expensed as incurred.
Concentration of Credit Risks	Concentration of Credit Risks Financial instruments that potentially subject the Company to concentration of credit risks principally consist of cash accounts in financial institutions. Although the accounts exceed the federally insured deposit amount, management does not anticipate nonperformance by the financial institutions.
Fair Value of Financial Instruments	Fair Value of Financial Instruments Accounts receivable, accounts payable and accrued expenses are reasonable estimates of their fair value due to their short maturity. Based on variable interest rates and the borrowing rates currently available to the Company for loans similar to its long-term debt, the fair value approximates its carrying amount.
Recent Accounting Pronouncements Adopted	Recent Accounting Pronouncements Adopted Effective January 1, 2018 the Company adopted ASU 2017-07, “Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” issued by the Financial Accounting Standards Board (FASB) which requires employers to present the service cost component of net periodic benefit cost in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period. Only the service cost component will be eligible for capitalization in assets. The other components of net periodic benefit cost will be presented separately from the line item(s) that includes the service cost and outside of any subtotal of operating income, if one is presented. ASU 2017-07 allows a practical expedient that permits an entity to use amounts disclosed in its pension and other post retirement requirements. The Company adopted this guidance during the reporting period. The reporting of the annual service costs is expected to be immaterial. Effective January 1, 2018, the Company adopted ASU 2014-09, "Revenue from Contracts with Customers (Topic 606)" using the modified retrospective method. The new revenue recognition standard outlines a comprehensive model for companies to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. Topic 606 also requires significantly expanded disclosure requirements and applied the standard to all contracts that were not completed as of January 1, 2018. There was no cumulative effect of the adoption recognized. We have obtained an understanding of the new standard and determined that there is no material change in our revenue recognition after implementation of the standard. See above for the Company’s updated revenue recognition accounting policy. Effective January 1, 2018, the Company adopted Recent Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842).” There are elements of the new standard that could impact almost all entities to some extent, although the lessees will likely see the most significant changes. Lessee will need to recognize virtually all of their leases on the balance sheet, by recording the right-of-use asset and a lease liability. Public business entities are required to adopt the new leasing standard for fiscal years, and interim period within those fiscal years, beginning December 15, 2018. For calendar year-end public companies, this means an adoption date of January 1, 2019. Early adoption is permitted. The Company does not believe the adoption will have a material impact on the financial statements and disclosures.

Business Description and Summ_3

Business Description and Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Schedule of property, plant and equipment estimated useful life	Buildings and improvements 5-40 years Machinery and equipment 5-20 years Tooling 3-5 years

Inventories (Table)

Inventories (Table)	9 Months Ended
	Sep. 30, 2018
Inventory Disclosure [Abstract]
Schedule of inventories	September 30, December 31, 2018 2017 ($000's omitted) Raw material and common parts $ 8,641 $ 8,375 Work-in-process 4,937 2,940 Finished goods 2,565 2,914 16,143 14,229 Less inventory reserve (1,492 ) (1,438 ) Total inventories $ 14,651 $ 12,791

Property, Plant and Equipment (

Property, Plant and Equipment (Tables)	9 Months Ended
	Sep. 30, 2018
Property, Plant and Equipment [Abstract]
Schedule of property, plant and equipment	September 30, December 31, 2018 2017 ($000's ommitted) Land $ 7 $ 7 Buildings 10,887 10,288 Machinery, equipment and tooling 17,815 17,249 Construction in progress 931 665 29,640 28,209 Less accumulated depreciation (17,927 ) (17,188 ) $ 11,713 $ 11,021

Long-Term Debt (Tables)

Long-Term Debt (Tables)	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
Schedule of long-term debt	September 30, December 31, 2018 2017 ($000's omitted) Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513 $ 1,638 $ 1,835 Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513 929 1,142 Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months) 745 654 3,312 3,631 Less current portion (723 ) (681 ) $ 2,589 $ 2,950
schedule of payments for capital lease obligations	September 30, 2018 ($000's omitted) 2018 $ 47 2019 193 2020 193 2021 193 2022 193 2023 2 Total minimum lease payments 821 Less amount representing interest (76 ) Present value of net minimum lease payments 745 Less current portion (175 ) Long term principle payments $ 570

Shareholders' Equity (Tables)

Shareholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2018
Equity [Abstract]
Schedule of stockholders equity	Common Stock ($000's omitted except for share data) Accumulated Number Capital in Other Total of shares excess of Retained Treasury Comprehensive shareholders' issued Amount par value earnings ESOT stock Loss equity Balance at December 31, 2017 2,614,506 $ 523 $ 14,171 $ 15,709 $ (662 ) $ (1,544 ) $ (32 ) $ 28,165 Net income - - - 2,495 - - - 2,495 Purchase of treasury shares - - - - - (150 ) - (150 ) Cash dividend - - - (413 ) - - - (413 ) Stock based compensation, net of tax benefit - - 55 (6 ) - 128 6 183 Balance at September 30, 2018 2,614,506 $ 523 $ 14,226 $ 17,785 $ (662 ) $ (1,566 ) $ (26 ) $ 30,280
Schedule of earnings per share	Three Months Ended Nine Months Ended September 30, September 30, 2018 2017 2018 2017 ($000's omitted except per share data) Net Income $ 1,457 $ 671 $ 2,495 $ 802 Weighted average common shares outstanding (basic) 2,295 2,262 2,259 2,264 Unvested restricted stock 82 29 82 29 Weighted average common shares outstanding (diluted) 2,377 2,291 2,341 2,293 Basic Net income per share $ 0.63 $ 0.30 $ 1.10 $ 0.35 Diluted Net income per share $ 0.61 $ 0.29 $ 1.07 $ 0.35

Business Segments (Tables)

Business Segments (Tables)	9 Months Ended
	Sep. 30, 2018
Segment Reporting [Abstract]
Schedule of information regarding operations in business segment	($000's omitted) ATG CPG Consolidated Nine Months Ended Nine Months Ended Nine Months Ended September 30, September 30, September 30, 2018 2017 2018 2017 2018 2017 Revenues from unaffiliated customers $ 30,028 $ 23,968 $ 5,245 $ 6,076 $ 35,273 $ 30,044 Cost of goods sold, inclusive of depreciation and amortization (21,600 ) (17,826 ) (4,759 ) (5,481 ) (26,359 ) (23,307 ) Gross margin 8,428 6,142 486 595 8,914 6,737 Gross margin % 28.1 % 25.6 % 9.3 % 9.8 % 25.3 % 22.4 % Selling, general and administrative (4,131 ) (4,148 ) (1,584 ) (1,400 ) (5,715 ) (5,548 ) Interest expense (55 ) (32 ) (25 ) (24 ) (80 ) (56 ) Total expenses (25,786 ) (22,006 ) (6,368 ) (6,905 ) (32,154 ) (28,911 ) Income (loss) before income tax provision (benefits) 4,242 1,962 (1,123 ) (829 ) 3,119 1,133 Income tax provision (benefits) 849 580 (225 ) (249 ) 624 331 Net income (loss) $ 3,393 $ 1,382 $ (898 ) $ (580 ) $ 2,495 $ 802 Capital expenditures $ 1,277 $ 1,777 $ 175 $ 124 $ 1,452 $ 1,901 ($000's omitted) ATG CPG Consolidated Three Months Ended Three Months Ended Three Months Ended September 30, September 30, September 30, 2018 2017 2018 2017 2018 2017 Revenues from unaffiliated customers $ 10,639 $ 8,918 $ 2,129 $ 2,407 $ 12,768 $ 11,325 Cost of goods sold, inclusive of depreciation and amortization (6,965 ) (6,198 ) (1,863 ) (2,036 ) (8,828 ) (8,234 ) Gross margin 3,674 2,720 266 371 3,940 3,091 Gross margin % 34.5 % 30.5 % 12.5 % 15.4 % 30.9 % 27.3 % Selling, general and administrative (1,476 ) (1,642 ) (598 ) (443 ) (2,074 ) (2,085 ) Interest expense (20 ) (9 ) (8 ) (9 ) (28 ) (18 ) Total expenses (8,461 ) (7,849 ) (2,469 ) (2,488 ) (10,930 ) (10,337 ) Income (loss) before income tax provision (benefits) 2,178 1,069 (340 ) (81 ) 1,838 988 Income tax provision (benefits) 457 341 (76 ) (24 ) 381 317 Net income (loss) $ 1,721 $ 728 $ (264 ) $ (57 ) $ 1,457 $ 671 Capital expenditures $ 432 $ 1,282 $ 36 $ 48 $ 468 $ 1,330

Business Description and Summ_4

Business Description and Summary of Significant Accounting Policies - Estimated useful lives of depreciable properties (Details)	9 Months Ended
	Sep. 30, 2018
Buildings and improvements | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	5 years
Buildings and improvements | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	40 years
Machinery and equipment | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	5 years
Machinery and equipment | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	20 years
Tooling | Minimum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	3 years
Tooling | Maximum
Property, Plant and Equipment [Line Items]
Estimated useful lives of depreciable properties	5 years

Business Description and Summ_5

Business Description and Summary of Significant Accounting Policies (Detail Textuals) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Accounting Policies [Abstract]
Allowance for doubtful accounts	$ 198,000		$ 149,000
Inventory reserve	1,492,000		1,438,000
Income taxes paid	875,000	$ 165,000
Interest paid	80,000	$ 56,000
Accumulated other comprehensive loss to retained earnings due to change in corporate tax rate	6,000
Warranty reserve	$ 408,000		$ 39,000

Inventories - Summary of invent

Inventories - Summary of inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw material and common parts	$ 8,641	$ 8,375
Work-in-process	4,937	2,940
Finished goods	2,565	2,914
Inventory, Gross	16,143	14,229
Less inventory reserve	(1,492)	(1,438)
Total inventories	$ 14,651	$ 12,791

Property, Plant and Equipment -

Property, Plant and Equipment - Summary of property, plant and equipment (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 29,640	$ 28,209
Less accumulated depreciation	(17,927)	(17,188)
Total property, plant and equipment	11,713	11,021
Land
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	7	7
Buildings
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	10,887	10,288
Machinery, equipment and tooling
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	17,815	17,249
Construction in progress
Property, Plant and Equipment [Line Items]
Property, plant and equipment, Gross	$ 931	$ 665

Property, Plant and Equipment_2

Property, Plant and Equipment (Detail Textuals) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Property, Plant and Equipment [Line Items]
Depreciation and amortization expense	$ 259,000	$ 209,000	$ 761,000	$ 637,000
Depreciation	239,000	206,000	704,000	628,000
Amortization	20,000	3,000	57,000	9,000
Advanced Technology Group ("ATG") and the Consumer Products Group ("CPG")
Property, Plant and Equipment [Line Items]
Construction in progress	931,000	$ 665,000	931,000	$ 665,000
Advanced Technology Group ("ATG") and the Consumer Products Group ("CPG") | Construction in progress
Property, Plant and Equipment [Line Items]
Implementation costs	556,000		556,000
Machinery received but not placed in service	240,000		240,000
Self constructed assets not yet put into service	$ 135,000		$ 135,000

Long-Term Debt - Summary of lon

Long-Term Debt - Summary of long term debt (Details) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Long-term debt	$ 3,312	$ 3,631
Less current portion	(723)	(681)
Long-term debt, Noncurrent	2,589	2,950
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513% as of September 30, 2018), monthly prinicipal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021
Debt Instrument [Line Items]
Long-term debt	1,638	1,835
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513% as of September 30, 2018), monthly prinicipal payments of $23,810 through December 1, 2021
Debt Instrument [Line Items]
Long-term debt	929	1,142
Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months)
Debt Instrument [Line Items]
Long-term debt	$ 745	$ 654

Long-Term Debt - Summary of l_2

Long-Term Debt - Summary of long term debt (Parentheticals) (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2018USD ($)
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513% as of September 30, 2018), monthly prinicipal payments of $21,833 through 2021 with a balloon payment of $786,000 due December 1, 2021
Debt Instrument [Line Items]
Description of rate basis	Libor
Percentage of floating interest rate payable	1.40%
Percentage of fixed interest rate payable	3.513%
Frequency of principal payments	monthly
Monthly principal payments	$ 21,833
Balloon payment due December 1, 2021	$ 786,000
Term loan payable to a financial institution; Interest rate option of bank prime or Libor plus 1.4% (3.513% as of September 30, 2018), monthly prinicipal payments of $23,810 through December 1, 2021
Debt Instrument [Line Items]
Description of rate basis	Libor
Percentage of floating interest rate payable	1.40%
Percentage of fixed interest rate payable	3.513%
Frequency of principal payments	monthly
Monthly principal payments	$ 23,810
Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months)
Debt Instrument [Line Items]
Period of principal payments	60 months
Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months) | Minimum
Debt Instrument [Line Items]
Percentage of floating interest rate payable	1.82276%
Capital lease obligations; Interest rate fixed for term of each funding based upon the Lender's lease pricing at time of funding. (Interest rate/factor 1.822758% - 1.869304% at time of funding with pricipal payments made over 60 months) | Maximum
Debt Instrument [Line Items]
Percentage of floating interest rate payable	1.8693%

Long-Term Debt (Details 1)

Long-Term Debt (Details 1) $ in Thousands	Sep. 30, 2018USD ($)
Debt Disclosure [Abstract]
2,018	$ 47
2,019	193
2,020	193
2,021	193
2,022	193
2,023	2
Total minimum lease payments	821
Less amount representing interest	(76)
Present value of net minimum lease payment	745
Less current portion	(175)
Long term principle payments	$ 570

Long-Term Debt (Detail Textuals

Long-Term Debt (Detail Textuals) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Debt Disclosure [Abstract]
Line of credit	$ 2,000,000
Lease line of credit	$ 1,000,000
lease term for equipment covered by lease line of credit	60 months
Buy out at end of term	$ 1
Line of credit outstanding	822,000
Principal payments for capital lease obligations	$ 119,000	$ 14,000

Stockholders' Equity - Summary

Stockholders' Equity - Summary of common shareholders' equity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			$ 28,165
Balance at December 31, 2017 (shares)			2,614,506
Net Income	$ 1,457	$ 671	$ 2,495	$ 802
Purchase of treasury shares			(150)
Cash dividend			(413)
Stock based compensation, net of tax benefit			183
Balance at June 30, 2018	$ 30,280		$ 30,280
Balance at June 30, 2018 (shares)	2,614,506		2,614,506
Common Stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			$ 523
Balance at December 31, 2017 (shares)			2,614,506
Net Income			$ 0
Purchase of treasury shares			0
Cash dividend			0
Stock based compensation, net of tax benefit			0
Balance at June 30, 2018	$ 523		$ 523
Balance at June 30, 2018 (shares)	2,614,506		2,614,506
Capital in excess of par value
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			$ 14,171
Net Income			0
Purchase of treasury shares			0
Cash dividend			0
Stock based compensation, net of tax benefit			55
Balance at June 30, 2018	$ 14,226		14,226
Retained earnings
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			15,709
Net Income			2,495
Purchase of treasury shares			0
Cash dividend			(413)
Stock based compensation, net of tax benefit			(6)
Balance at June 30, 2018	17,785		17,785
ESOT
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			(662)
Net Income			0
Purchase of treasury shares			0
Cash dividend			0
Stock based compensation, net of tax benefit			0
Balance at June 30, 2018	(662)		(662)
Treasury stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			(1,544)
Net Income			0
Purchase of treasury shares			(150)
Cash dividend			0
Stock based compensation, net of tax benefit			128
Balance at June 30, 2018	(1,566)		(1,566)
Accumulated Other Comprehensive Loss
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Balance at December 31, 2017			(32)
Net Income			0
Purchase of treasury shares			0
Cash dividend			0
Stock based compensation, net of tax benefit			6
Balance at June 30, 2018	$ (26)		$ (26)

Shareholders' Equity - Calculat

Shareholders' Equity - Calculation of earning per share (Details 1) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Equity [Abstract]
Net Income	$ 1,457	$ 671	$ 2,495	$ 802
Weighted average common shares outstanding (basic) (in shares)	2,295	2,262	2,259	2,264
Unvested restricted stock (in shares)	82	29	82	29
Weighted average common shares outstanding (diluted) (in shares)	2,377	2,291	2,341	2,293
Basic
Net Income per share	$ 0.63	$ 0.30	$ 1.10	$ 0.35
Diluted
Net income per share	$ 0.61	$ 0.29	$ 1.07	$ 0.35

Shareholders' Equity (Detail Te

Shareholders' Equity (Detail Textuals)	9 Months Ended
	Sep. 30, 2018shares
Equity, Class of Treasury Stock [Line Items]
Shares purchased during period	3,350
Share Repurchase Program
Equity, Class of Treasury Stock [Line Items]
Number of common shares authorized to be purchased	450,000
Shares purchased during period	352,680
Remaining number of shares authorized to be purchased	97,320

Shareholders' Equity (Detail _2

Shareholders' Equity (Detail Textuals 1) - 2012 Long-Term Incentive Plan - USD ($)	1 Months Ended		9 Months Ended
	May 25, 2018	Jan. 31, 2018	Sep. 30, 2018	Sep. 30, 2017
Executive Officers
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Number of restricted stock issued	78,750
Compensation expense not yet recognized	$ 735,000
Expense recognized for issuance of restricted shares			$ 183,000	$ 176,000
Number of restricted stock shares vested		28,500
Number of shares withheld and repurchased		11,341
Value of shares withheld and repurchased		$ 117,000
Non-employee directors
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Number of restricted stock issued	4,288
Compensation expense not yet recognized	$ 40,000
Service period	12 months

Shareholders' Equity (Detail _3

Shareholders' Equity (Detail Textuals 2) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended
	May 18, 2018	Sep. 30, 2018	Jun. 30, 2018
Equity [Abstract]
Dividends declaration date	May 18, 2018
Per share cash dividend	$ 0.16
Date of dividends to be paid	Jul. 16, 2018
Dividends payable record date	Jun. 30, 2018
Aggregate dividend payable	$ 413	$ 13	$ 416

Commitments and Contingencies (

Commitments and Contingencies (Detail Textuals) - USD ($)	9 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Loss Contingencies [Line Items]
Post retirement obligation	$ 1,007,000	$ 1,007,000
Arbitration-related expense	367,000
Employment Agreement | Kenneth Trbovich
Loss Contingencies [Line Items]
Post retirement obligation	$ 821,000	$ 736,000
Minimum age limit	65 years
CPG
Loss Contingencies [Line Items]
Amount of grant received from Cattaraugus County, New York	$ 300,000
Term of maintaining employment level	5 years

Litigation (Detail Textuals)

Litigation (Detail Textuals) - Aero, Inc.	9 Months Ended
	Sep. 30, 2018USD ($)
Litigation [Line Items]
Amount of alleged damages	$ 3,000,000
Amount of counter claim	$ 3,191,000

Related Party Transactions (Det

Related Party Transactions (Detail Textuals) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Related Party Transactions [Abstract]
Legal fees and disbursements	$ 23,000	$ 44,000	$ 117,000	$ 188,000
Accrued additional legal fees	$ 19,000	$ 39,000	$ 19,000	$ 39,000

Business Segments - Summary of

Business Segments - Summary of company's operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Segment Reporting Information [Line Items]
Revenues from unaffiliated customers	$ 12,768	$ 11,325	$ 35,273	$ 30,044
Cost of goods sold, inclusive of depreciation and amortization	(8,828)	(8,234)	(26,359)	(23,307)
Gross Profit	$ 3,940	$ 3,091	$ 8,914	$ 6,737
Gross margin %	30.90%	27.30%	25.30%	22.40%
Selling, general and administrative	$ (2,074)	$ (2,085)	$ (5,715)	$ (5,548)
Interest expense	(28)	(18)	(80)	(56)
Income (loss) before income tax provision (benefits)	1,838	988	3,119	1,133
Income tax provision (benefits)	381	317	624	331
Net income (loss)	1,457	671	2,495	802
Capital expenditures			1,452	1,401
Operating Segments
Segment Reporting Information [Line Items]
Revenues from unaffiliated customers	12,768	11,325	35,273	30,044
Cost of goods sold, inclusive of depreciation and amortization	(8,828)	(8,234)	(26,359)	(23,307)
Gross Profit	$ 3,940	$ 3,091	$ 8,914	$ 6,737
Gross margin %	30.90%	27.30%	25.30%	22.40%
Selling, general and administrative	$ (2,074)	$ (2,085)	$ (5,715)	$ (5,548)
Interest expense	(28)	(18)	(80)	(56)
Total expenses	(10,930)	(10,337)	(32,154)	(28,911)
Income (loss) before income tax provision (benefits)	1,838	988	3,119	1,133
Income tax provision (benefits)	381	317	624	331
Net income (loss)	1,457	671	2,495	802
Capital expenditures	468	1,330	1,452	1,901
Operating Segments | ATG
Segment Reporting Information [Line Items]
Revenues from unaffiliated customers	10,639	8,918	30,028	23,968
Cost of goods sold, inclusive of depreciation and amortization	(6,965)	(6,198)	(21,600)	(17,826)
Gross Profit	$ 3,674	$ 2,720	$ 8,428	$ 6,142
Gross margin %	34.50%	30.50%	28.10%	25.60%
Selling, general and administrative	$ (1,476)	$ (1,642)	$ (4,131)	$ (4,148)
Interest expense	(20)	(9)	(55)	(32)
Total expenses	(8,461)	(7,849)	(25,786)	(22,006)
Income (loss) before income tax provision (benefits)	2,178	1,069	4,242	1,962
Income tax provision (benefits)	457	341	849	580
Net income (loss)	1,721	728	3,393	1,382
Capital expenditures	432	1,282	1,277	1,777
Operating Segments | CPG
Segment Reporting Information [Line Items]
Revenues from unaffiliated customers	2,129	2,407	5,245	6,076
Cost of goods sold, inclusive of depreciation and amortization	(1,863)	(2,036)	(4,759)	(5,481)
Gross Profit	$ 266	$ 371	$ 486	$ 595
Gross margin %	12.50%	15.40%	9.30%	9.80%
Selling, general and administrative	$ (598)	$ (443)	$ (1,584)	$ (1,400)
Interest expense	(8)	(9)	(25)	(24)
Total expenses	(2,469)	(2,488)	(6,368)	(6,905)
Income (loss) before income tax provision (benefits)	(340)	(81)	(1,123)	(829)
Income tax provision (benefits)	(76)	(24)	(225)	(249)
Net income (loss)	(264)	(57)	(898)	(580)
Capital expenditures	$ 36	$ 48	$ 175	$ 124

Business Segments (Detail Textu

Business Segments (Detail Textuals)	9 Months Ended	12 Months Ended
	Sep. 30, 2018USD ($)Segment	Dec. 31, 2017USD ($)Segment
Segment Reporting Information [Line Items]
Total identifiable assets	$ 40,803,000	$ 37,986,000
Number of operating segments | Segment	2	2
Operating Segments
Segment Reporting Information [Line Items]
Total identifiable assets	$ 40,803,000	$ 37,986,000
Operating Segments | ATG
Segment Reporting Information [Line Items]
Total identifiable assets	29,896,000	26,331,000
Operating Segments | CPG
Segment Reporting Information [Line Items]
Total identifiable assets	$ 10,907,000	$ 11,655,000