Document Entity Information
Document Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 08, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | SMITH MIDLAND CORP | ||
Entity Central Index Key | 0000924719 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Is Entity a Well-known Seasoned Issuer? | No | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation, State or Country Code | DE | ||
Entity File Number | 1-13752 | ||
Entity Common Stock, Shares Outstanding | 5,202,158 | ||
Entity Public Float | $ 29,911,628 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash | $ 8,764 | $ 1,364 |
Investment securities, available-for-sale, at fair value | 1,228 | 1,176 |
Accounts receivable, net | ||
Trade - billed (less allowance for doubtful accounts of $397 and $333), including contract retentions | 9,798 | 12,723 |
Trade - unbilled | 742 | 310 |
Inventories, net | ||
Raw materials | 643 | 488 |
Finished goods | 1,551 | 1,754 |
Prepaid expenses and other assets | 615 | 784 |
Refundable income taxes | 0 | 432 |
Total current assets | 23,341 | 19,031 |
Property and equipment, net | 18,602 | 17,735 |
Deferred buy-back lease asset, net | 4,237 | 5,042 |
Other assets | 319 | 307 |
Total assets | 46,499 | 42,115 |
Current liabilities | ||
Accounts payable - trade | 1,866 | 3,180 |
Accrued expenses and other liabilities | 875 | 125 |
Deferred revenue | 1,774 | 1,891 |
Accrued compensation | 1,318 | 1,075 |
Dividend payable | 0 | 282 |
Accrued income tax | 470 | 0 |
Deferred buy-back lease obligation | 1,203 | 966 |
Operating lease liabilities | 85 | 81 |
Current maturities of notes payable | 740 | 925 |
Customer deposits | 569 | 1,077 |
Total current liabilities | 8,900 | 9,602 |
Deferred revenue | 600 | 241 |
Deferred buy-back lease obligation | 3,790 | 5,183 |
Operating lease liabilities | 211 | 296 |
Notes payable - less current maturities | 4,196 | 4,086 |
PPP loan | 2,692 | 0 |
Deferred tax liability | 2,461 | 1,886 |
Total liabilities | 22,850 | 21,294 |
Commitments and contingencies | ||
Stockholders' equity | ||
Preferred stock, $.01 par value; authorized 1,000,000 shares, none issued and outstanding | 0 | 0 |
Common stock, $.01 par value; authorized 8,000,000 shares; 5,279,411 and 5,224,911 issued and 5,202,158 and 5,164,324 outstanding, respectively | 52 | 52 |
Additional paid-in capital | 6,405 | 6,242 |
Treasury stock, at cost, 40,920 shares | (102) | (102) |
Retained earnings | 17,294 | 14,629 |
Total stockholders' equity | 23,649 | 20,821 |
Total liabilities and stockholders' equity | $ 46,499 | $ 42,115 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Allowance for doubtful accounts | $ 397 | $ 333 |
Stockholders' equity | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 8,000,000 | 8,000,000 |
Common stock, shares issued | 5,279,411 | 5,224,911 |
Common stock, shares outstanding | 5,202,158 | 5,164,324 |
Treasury shares | 40,920 | 40,920 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue | ||
Total revenue | $ 43,862 | $ 46,691 |
Cost of goods sold | 32,820 | 36,722 |
Gross profit | 11,042 | 9,969 |
General and administrative expenses | 4,989 | 4,887 |
Selling expenses | 2,294 | 2,536 |
Total operating expenses | 7,283 | 7,423 |
Operating income | 3,759 | 2,546 |
Other income (expense) | ||
Interest expense | (217) | (179) |
Interest income | 35 | 40 |
Gain on sale of assets | 133 | 46 |
Other income | 82 | 45 |
Total other income (expense) | 33 | (48) |
Income before income tax expense | 3,792 | 2,498 |
Income tax expense | 1,127 | 549 |
Net income | $ 2,665 | $ 1,949 |
Basic and diluted earnings per share | $ .51 | $ 0.38 |
Product Sales | ||
Revenue | ||
Total revenue | $ 26,776 | $ 32,228 |
Barrier Rentals | ||
Revenue | ||
Total revenue | 6,879 | 2,488 |
Royalty Income | ||
Revenue | ||
Total revenue | 1,688 | 1,672 |
Shipping and Installation Revenue | ||
Revenue | ||
Total revenue | $ 8,519 | $ 10,303 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Total |
Balance, beginning at Dec. 31, 2018 | $ 51 | $ 5,973 | $ (102) | $ 12,962 | $ 18,884 |
Accrued dividends payable | (282) | (282) | |||
Vesting of restricted stock | 1 | 269 | 270 | ||
Net income | 1,949 | 1,949 | |||
Balance, ending at Dec. 31, 2019 | 52 | 6,242 | (102) | 14,629 | 20,821 |
Vesting of restricted stock | 163 | 163 | |||
Net income | 2,665 | 2,665 | |||
Balance, ending at Dec. 31, 2020 | $ 52 | $ 6,405 | $ (102) | $ 17,294 | $ 23,649 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of net income to net cash provided by operating activities | ||
Net income | $ 2,665 | $ 1,949 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 2,412 | 1,793 |
Allowance for doubtful accounts | 64 | 119 |
Gain on sale of fixed assets | (133) | (46) |
Unrealized gain (loss) | (23) | 10 |
Stock compensation | 163 | 270 |
Deferred taxes | 575 | 459 |
(Increase) decrease in | ||
Accounts receivable - billed | 2,861 | (561) |
Accounts receivable - unbilled | (432) | 1,003 |
Inventories | 48 | 1,318 |
Refundable income taxes | 432 | 477 |
Prepaid expenses and other assets | 128 | (286) |
Increase (decrease) in | ||
Accounts payable - trade | (1,314) | (1,032) |
Accrued expenses and other liabilities | 750 | (485) |
Deferred revenue | 242 | 450 |
Accrued compensation | 243 | (481) |
Accrued income taxes | 470 | 0 |
Deferred buy-back lease obligation | (1,156) | (444) |
Customer deposits | (508) | (581) |
Net cash provided by operating activities | 7,487 | 3,932 |
Cash Flows From Investing Activities | ||
Purchases of investment securities available-for-sale | (29) | (32) |
Purchases of property and equipment | (2,627) | (4,513) |
Deferred buy-back lease asset | 0 | (358) |
Proceeds from sale of fixed assets | 235 | 162 |
Net cash used in investing activities | (2,421) | (4,741) |
Cash Flows From Financing Activities | ||
Proceeds from the line-of-credit construction draw | 0 | 500 |
Repayments on the line-of-credit construction draw | 0 | (1,500) |
Proceeds from long-term borrowings | 5,485 | 2,277 |
Repayments of long-term borrowings | (2,869) | (769) |
Dividends paid on common stock | (282) | (281) |
Net cash provided by financing activities | 2,334 | 227 |
Net increase (decrease in cash | 7,400 | (582) |
Cash, beginning of year | 1,364 | 1,946 |
Cash, end of year | 8,764 | 1,364 |
Supplemental Cash Flow Information: | ||
Non-cash transaction - dividends payable | 0 | 282 |
Non-cash transaction - right of use asset and lease liability upon lease standard adoption | 0 | 414 |
Cash payments for interest | 217 | 179 |
Cash payments for income taxes | $ 22 | $ 73 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Nature of Business Smith-Midland Corporation and its wholly-owned subsidiaries (the “Company”) develop, manufacture, license, sell and install precast concrete products for the construction, transportation and utilities industries in the Mid-Atlantic, Northeastern, Midwestern and Southeastern regions of the United States. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Smith-Midland Corporation and its wholly-owned subsidiaries. The Company’s wholly-owned subsidiaries consist of Smith-Midland Corporation, a Virginia corporation, Smith-Carolina Corporation, a North Carolina corporation, Smith-Columbia Corporation, a South Carolina corporation, Easi-Set Industries, Inc., a Virginia corporation, Concrete Safety Systems, Inc., a Virginia corporation, and Midland Advertising and Design, Inc., doing business as Midland Advertising + Design, a Virginia corporation. All material intercompany accounts and transactions have been eliminated in consolidation. Cash The Company considers all unrestricted cash and money market accounts purchased with an original or remaining maturities of three months or less as cash. Investments Investments in marketable securities are classified as available-for-sale and are stated at market value. Inventories Inventories are stated at the lower of cost, using the first-in, first-out (FIFO) method, or net realizable value. Inventory reserves (in thousands) were approximately $72 at December 31, 2020 and 2019. Property and Equipment Property and equipment is stated at cost. Expenditures for ordinary maintenance and repairs are charged to income as incurred. Costs of improvements, renewals, and major replacements are capitalized. At the time properties are retired or otherwise disposed of, the related cost and allowance for depreciation are eliminated from the accounts and any gain or loss on disposition is reflected in income. Depreciation expense is computed using the straight-line method over the following estimated useful lives: Years Buildings 10-40 Trucks and automotive equipment 3-10 Shop machinery and equipment 3-10 Land improvements 10-15 Rental equipment 5-10 Office equipment 3-10 Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. As of December 31, 2020, the Company has not identified any uncertain tax positions. The Company files tax returns in the U.S. Federal and various state jurisdictions. The Company recognizes, when applicable, interest and penalties related to income taxes in other income (expense) in its consolidated statement of income. The Company is no longer subject to U.S. or state tax examinations for the years prior to 2017. The Company does not have any uncertain tax positions as of December 31, 2020, and believes there will be no material changes in unrecognized tax positions over the next twelve months. Stock Compensation On October 13, 2016, the Board of Directors of the Company adopted the 2016 Equity Incentive Plan which allows the Company to grant up to 400,000 shares of common stock of the Company to employees, officers, directors and consultants. The grants may be in the form of restricted or performance shares of common stock of the Company. The fair value of each restricted stock grant is estimated to be the sales price of the common stock at the close of business on the day of the grant. Revenue Recognition Product Sales - Over Time Under Topic 606, the Company recognizes revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services provided. Revenue associated with contracts with customers is recognized over time as the Company's performance creates or enhances customer controlled assets or creates or enhances an asset with no alternative use, which the Company has an enforceable right to receive compensation as defined under the contract for performance completed. To determine the amount of revenue to recognize over time, the Company recognizes revenue over the contract terms based on the output method. The Company applied the "as invoiced" practical expedient as the amount of consideration the Company has the right to invoice corresponds directly with the value of the Company's performance to date. As the output method is driven by units produced, the Company recognizes revenues based on the value transferred to the customer relative to the remaining value to be transferred. The Company also matches the costs associated with the units produced. If a contract is projected to result in a loss, the entire contract loss is recognized in the period when the loss was first determined and the amount of the loss updated in subsequent reporting periods. Revenue recognition also includes an amount related to a contract asset or contract liability. If the recognized revenue is greater than the amount billed to the customer, a contract asset is recorded in accounts receivable - unbilled. Conversely, if the amount billed to the customer is greater than the recognized revenue, a contract liability is recorded in customer deposits on uncompleted contracts. Changes in the job performance, job conditions and final contract settlements are factors that influence management’s assessment of total contract value and therefore, profit and revenue recognition. A portion of the work the Company performs requires financial assurances in the form of performance and payment bonds or letters of credit at the time of execution of the contract. Some contracts include retention provisions of up to 10% which are generally withheld from each progress payment as retainage until the contract work has been completed and approved. Product Sales - Point in Time For certain product sales that do not meet the over time criteria, under Topic 606 the Company recognizes revenue when the product has been shipped to the destination in accordance with the terms outlined in the contract where a present obligation to pay exists and the customers have gained control of the product. Accounts Receivable and Contract Balances The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided or products are shipped. Projects with performance obligations recognized over time that have costs and estimated earnings recognized to date in excess of cumulative billings, are reported on our Condensed Consolidated Balance Sheets as "Accounts receivable trade - unbilled" (contract assets). Projects with performance obligations recognized over time that have cumulative billings in excess of costs and estimate earnings recognized to date, are reported on our Condensed Consolidated Balance Sheets as "Customer deposits" (contract liabilities). Any uncollected billed amounts for our performance obligations recognized over time, including contract retentions, are recorded within accounts receivable trade - billed. At December 31, 2020 and December 31, 2019, accounts receivable included contract retentions (in thousands) of approximately $1,709 and $2,146, respectively, which are considered contract assets. Our billed and unbilled revenue may be exposed to potential credit risk if our customers should encounter financial difficulties, and we maintain reserves for specifically-identified potential uncollectible receivables. At December 31, 2020 and December 31, 2019, our allowances for doubtful accounts (in thousands) were $397 and $333, respectively. Sale to Customer with a Buy-Back Guarantee - Lease Income The Company entered into a buy-back agreement with one specific customer. Under this agreement, the Company guaranteed to buy-back product at a predetermined price at the end of the long-term project, subject to the condition of the product. Although the Company receives payment in full as the product is produced, we are required to account for these transactions as operating leases. The amount of sale proceeds equal to the buy-back obligation, included in "Deferred buy-back lease obligation" in the liabilities section of the consolidated balance sheet, is deferred until the buy-back is exercised or expired. The remaining sale proceeds are deferred in the same account and recognized on a straight-line basis over the usage period, such usage period commencing on delivery to the job-site and ending at the time the buy-back is exercised or expired. The Company capitalizes the cost of the product on the consolidated balance sheet shown in "Deferred buy-back lease asset, net", and depreciates the value, less residual value, to cost of leasing revenue in "Cost of goods sold" over the estimated useful life of the asset. In the case the customer does not exercise the buy-back option and retains ownership of the product at the end of the usage period, the guarantee buy-back liability and any deferred revenue balances related to the product are settled to revenue, and the net book value of the asset is expensed to cost of leasing revenue. If the customer exercises the buy-back guarantee option, the Company purchases the product back in the amount equal to the buy-back guarantee, the Company settles any remaining deferred balances, in excess of the buy-back payment, to leasing revenue, and the Company reclassifies the net book value of the product on the consolidated balance sheet to "Inventories" or "Property and equipment, net" depending on the intended use at the time. The revenue is being recognized in accordance with Topic 842, Leases Barrier Rentals - Lease Income Leasing fees are paid by customers at the beginning of the lease agreement and are recorded as deferred revenue. The deferred revenue is then recognized each month as lease income for the duration of the lease, in accordance with Topic 842, Leases Royalty Income The Company licenses certain products to other precast companies to produce the Company's products to engineering specifications under the licensing agreements. The agreements are typically for five year terms and require royalty payments from 4% to 6% of total sales of licensed products, which are paid on a monthly basis. The revenues from licensing agreements are recognized in the month earned, in accordance with Topic 606-10-55-65. Shipping and Installation Shipping and installation revenues are recognized as a distinct performance obligation in the period the shipping and installation services are provided to the customer, in accordance with Topic 606. Disaggregation of Revenue In the following table, revenue is disaggregated by primary sources of revenue (in thousands): Revenue by Type 2020 2019 Change % Change Product Sales: Soundwall Sales $ 7,499 $ 7,736 $ (237 ) (3 )% Architectural Sales 3,668 1,104 2,564 232 % SlenderWall Sales 948 5,063 (4,115 ) (81 )% Miscellaneous Wall Sales 3,371 1,685 1,686 100 % Barrier Sales 5,507 8,582 (3,075 ) (36 )% Easi-Set and Easi-Span Building Sales 2,935 5,937 (3,002 ) (51 )% Utility Sales 1,310 1,608 (298 ) (19 )% Miscellaneous Sales 1,538 513 1,025 199 % Total Product Sales 26,776 32,228 (5,452 ) (17 )% Barrier Rentals 6,879 2,488 4,391 176 % Royalty Income 1,688 1,672 16 1 % Shipping and Installation Revenue 8,519 10,303 (1,784 ) (17 )% Total Service Revenue 17,086 14,463 2,623 18 % Total Revenue $ 43,862 $ 46,691 $ (2,829 ) (6 )% Smith-Midland products are typically sold pursuant to an implicit warranty as to merchantability only. Warranty claims are reviewed and resolved on a case by case method. Although the Company does incur costs for these types of expense, historically the amount of expense is minimal. The revenue items: soundwall sales, architectural sales, SlenderWall sales, miscellaneous wall sales, barrier rentals, and royalty income are recognized as revenue over time. The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, miscellaneous sales, and shipping and installation revenue are recognized as revenue at a point in time. Sales and Use Taxes The Company does report sales taxes as part of revenue and use taxes on construction materials are reported gross in cost of goods sold. Segment Reporting Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and assess performance. The Company currently operates in one operating and reportable business segment for financial reporting purposes. Risks and Uncertainties On January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the "COVID-19 outbreak") and on March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity for fiscal year 2021. The Company sells products to highway contractors operating under government funded highway programs and other customers and extends credit based on an evaluation of the customer’s financial condition, generally without requiring collateral. Exposure to losses on receivables is principally dependent on each customer’s financial condition. The Company monitors its exposure to credit losses and maintains allowances for anticipated losses. Management reviews accounts receivable on a regular basis to determine the probability of collection. In performing this evaluation, the Company analyzes the payment history and its significant past due accounts, subsequent cash collections on these accounts, comparative accounts receivable aging statistics, and other customer specific considerations existing and known as of the time of the analysis. Based on this information, along with other related factors, the Company develops what it considers to be a reasonable estimate of the uncollectible amounts included in accounts receivable. Management believes the allowance for doubtful accounts at December 31, 2020 is adequate. However, actual write-offs may exceed the recorded allowance. Due to inclement weather, the Company may experience reduced revenue from December through February and may realize the substantial part of its revenue during the other months of the year. Fair Value of Financial Instruments The carrying value for each of the Company’s financial instruments approximates fair value because of the short-term nature of those instruments. The estimated fair value of the long-term debt approximates carrying value based on current rates offered to the Company for debt of similar maturities. Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting (U.S. GAAP) principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Advertising Costs The Company expenses all advertising costs as incurred. Advertising expense (in thousands) was approximately $383 and $393 in 2020 and 2019, respectively. Earnings Per Share Earnings per share are based on the weighted average number of shares of common stock and dilutive common stock equivalents outstanding. Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in earnings of the Company. Long-Lived Assets The Company reviews the carrying values of its long-lived and identifiable intangible assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable based on undiscounted estimated future operating cash flows. When any such impairment exists, the related assets will be written down to fair value. No impairment losses have been recorded during the two years ended December 31, 2020. Recently Adopted Accounting Pronouncement The FASB issued ASU No. 2016-13, “ Measurement of Credit Losses on Financial Instruments |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment consists of the following (in thousands): December 31, 2020 2019 Land and land improvements $ 3,764 $ 2,688 Buildings and improvements 8,930 8,962 Machinery and equipment 13,952 13,621 Rental equipment 5,895 5,201 32,541 30,472 Less: accumulated depreciation and amortization (13,939 ) (12,737 ) $ 18,602 $ 17,735 Depreciation expense and amortization (in thousands) was approximately $2,412 and $1,793 for the years ended December 31, 2020 and 2019, respectively. |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2020 | |
Notes Payable [Abstract] | |
Notes Payable | Notes payable consist of the following (in thousands): December 31, 2020 2019 Note payable to Summit Community Bank (the "Bank"), maturing September 2021; with monthly payments of approximately $26 of principal and interest fixed at 3.99%; collateralized by principally all assets of the Company. $ 227 $ 519 Note payable to the Bank, maturing July 2031; with monthly payments of approximately $11 of principal and interest fixed at 5.29%; collateralized by principally all assets of Smith-Columbia Corporation and guaranteed by the Company. 1,103 Note payable to the Bank, maturing October 2029; with monthly payments of approximately $22 of principal and interest fixed at 3.64% under a swap agreement; collateralized by principally all assets of Smith-Carolina Corporation and guaranteed by the Company. 2,008 2,197 Note payable to the Bank, maturing March 2030; with monthly payments of approximately $27 of principal and interest fixed at 3.99%; collateralized by principally all assets of the Company. 2,535 Installment notes, collateralized by certain machinery and equipment maturing at various dates; with monthly payments varying from $0.7 to $6.2 with annual interest rates between 2.90% and 5.29%. 166 1,192 A revolving line-of-credit evidenced by a note payable to the Bank, with the maximum amount of $4,000, maturing October 1, 2021, with interest only payments and an initial rate of 4.49% adjustable monthly (4.75% at December 31, 2020). The line-of-credit is collateralized by a first lien position on the Company's accounts receivable and inventory and a second lien position on all other business assets. 4,936 5,011 Less current maturities (740 ) (925 ) $ 4,196 $ 4,086 In addition to the notes payable discussed above, on April 16, 2020, the Company obtained a loan, evidenced by a promissory note, under the Paycheck Protection Program (the "PPP") from the Bank in the amount of $2,692. The PPP provides for loans to qualifying businesses, the proceeds of which may only be used for payroll costs, rent, utilities, mortgage interest, and interest on other pre-existing indebtedness (the "permissible expenses"). The interest rate per the promissory note, dated April 16, 2020 and executed by the Company in favor of the Bank, is fixed at 1.00% per annum, with principal and interest payments starting thirty (30) days after the amount of forgiveness is determined under section 1106 of the CARES Act. The loan matures on April 16, 2022. The proceeds of the loan must be utilized pursuant to the requirements of the PPP, and all or a portion of the loan may be forgiven in accordance with the PPP applicable rules, regulations, and guidelines. Pursuant to the loan agreement relating to the PPP loan, the Bank may accelerate the loan in the event of a default under this or any other loan agreement with the Bank. The Company has currently applied for loan forgiveness in the full amount of the loan, but no assurance can be given as to the amount, if any, of forgiveness. The Company's notes payable includes certain restrictive covenants, which require the Company to maintain minimum levels of tangible net worth, places limits on annual capital expenditures, and the payment of cash dividends. At December 31, 2020, the Company was in compliance with all covenants pursuant to the loan agreements, with the $10 million net worth, and with the annual capital expenditures of $3,500, excluding acquisitions and plant expansions. The aggregate amounts of notes payable maturing in each of the next five years and thereafter are as follows (in thousands): Year Ending December 31, 2020 $ 740 2021 471 2022 483 2023 496 2024 511 Thereafter 2,235 $ 4,936 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | The Company currently leases a portion of its Midland, Virginia property from its Chairman of the Board, on a month-to-month basis, as additional storage space for the Company's finished work product. The lease agreement calls for an annual rent of $24,000. The Company has an employment agreement with its former CEO and current Chairman of the Board, Rodney I. Smith. Mr. Smith received his salary, pursuant to the terms of the agreement, through September 2019. While Mr. Smith has ceased providing executive officer services pursuant to such agreement, the agreement provides for an annual royalty fee of $99,000 payable as consideration for his assignment to the Company of all of his rights, title and interest in certain patents. Payment of the royalty continues for as long as the Company is using the inventions underlying the patents. Mr. Smith also received compensation from the Company for his services as a Director and Chairman of the Board. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income tax expense is comprised of the following (in thousands): December 31, 2020 2019 Federal: Current $ 212 $ (1 ) Deferred 416 440 628 439 State: Current 340 91 Deferred 159 19 499 110 $ 1,127 $ 549 The provision for income taxes differs from the amount determined by applying the federal statutory tax rate to pre-tax income as a result of the following (in thousands): December 31, 2020 2019 Income taxes at statutory rate $ 796 21.0 % $ 527 21.0 % Increase (decrease) in taxes resulting from: State income taxes, net of federal benefit 443 11.7 % 81 3.2 % Other prior year adjustments 184 4.9 % (127 ) (5.1 )% Provision-to-return (33 ) (0.9 )% 81 3.2 % Rate change (42 ) (1.7) % CARES Act Benefit (253 ) (6.7 )% Other (10 ) (0.3 )% 29 1.3 % $ 1,127 29.7 % $ 549 21.9 % Deferred tax assets (liabilities) are as follows (in thousands): December 31, 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 26 $ 21 Allowance for doubtful accounts 100 81 Amortization - Intangibles 4 Charitable contributions 43 Accrued liabilities 7 Accrued vacation 60 76 Deferred buy-back asset 1,259 1,776 Deferred income 314 304 Right-of-use asset 75 91 Other 80 83 Gross deferred tax assets 1,914 2,486 Deferred tax liabilities: Retainage (424 ) (518 ) Deferred buy-back obligation (1,069 ) (1,421 ) Fixed assets (2,685 ) (2,236 ) Prepaids (114 ) (104 ) Amortization - Intangibles (8 ) Unrealized gain loss (2 ) Lease liability (75 ) (91 ) Gross deferred tax liabilities (4,375 ) (4,372 ) Valuation allowance Net deferred tax liability $ (2,461 ) $ (1,886 ) As of December 31, 2020, the Company had approximately $2,611 of state NOL's available to offset future state taxable income. The state NOL's begin expiring at various times between 2029 and 2038. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Employee Benefit and Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Employee Benefit Plans | The Company has a savings plan that qualifies under Section 401(k) of the Internal Revenue Code ("IRC"). Participating employees may elect to contribute a percentage of their salary, subject to certain limitations. The Company contributes 50% of the participant's contribution, up to 4% of the participant's compensation, as a matching contribution. Total match contributions (in thousands) by the Company for the years ended December 31, 2020 and 2019 were approximately $183 and $179, respectively. |
Stock Compensation
Stock Compensation | 12 Months Ended |
Dec. 31, 2020 | |
Compensation Related Costs [Abstract] | |
Stock Compensation | On October 13, 2016, the Board of Directors of the Company adopted the 2016 Equity Incentive Plan, which allows the Company to grant up to 400,000 shares of restricted common stock of the Company to employees, officers, directors and consultants. The grants may be in the form of restricted or performance shares of common stock of the Company. The total intrinsic value (in thousands) of the outstanding shares of restricted stock is $326. The fair value of restricted stock awards is estimated to be the market price of the Company's common stock at the close of date of grant. Restricted stock activity during the years ended December 31, 2019 and 2020 is as follows: Number of Shares Weighted Average Grant Date Fair Value per Share Non-vested, December 31, 2018 69,500 $ 5.19 Granted 2,000 7.43 Vested 51,499 5.27 Forfeited 334 4.95 Non-vested, December 31, 2019 19,667 5.45 Granted 54,500 8.98 Vested 37,831 7.14 Forfeited Non-vested, December 31, 2020 36,336 $ 8.98 Awards are being amortized to expense ratably, based upon the vesting schedule. Stock compensation (in thousands) for the year ended December 31, 2020 was approximately $163, based upon the value at the date of grant. Stock compensation for the year ended December 31, 2019 was approximately $270, based upon the value at the date of grant. There was $326 of unrecognized compensation cost related to the non-vested restricted stock as of December 31, 2020. |
Fair Value Disclosures
Fair Value Disclosures | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | The Company applies the guidance that is codified under ASC 820-10 related to assets and liabilities recognized or disclosed in the financial statements at fair value on a recurring basis. ASC 820-10 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. The provisions of ASC 820-10 only apply to the Company’s investment securities, which are carried at fair value. ASC 820-10 clarifies that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820-10 requires valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Fair Value Hierarchy Inputs to Fair Value Methodology Level 1 Quoted prices in active markets for identical assets or liabilities Level 2 Quoted prices for similar assets or liabilities; quoted markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the financial instrument; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from, or corroborated by, observable market information Level 3 Pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption is unobservable or when the estimation of fair value requires significant management judgment The Company categorizes a financial instrument in the fair value hierarchy based on the lowest level of input that is significant to its fair value measurement. As of December 31, 2020 Quoted Market Prices in Active Markets Internal Models with Significant Observable Internal Models Total Fair Value Mutual Funds $ 1,228 $ $ $ 1,228 As of December 31, 2019 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable (Level 2) Internal Models (Level 3) Total Fair Value Reported in Financial Statements Mutual Funds $ 1,176 $ $ $ 1,176 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | The Company is party to legal proceedings and disputes which may arise in the ordinary course of business. In the opinion of the Company, it is unlikely that liabilities, if any, arising from legal disputes will have a material adverse effect on the consolidated financial position of the Company. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings per share are calculated as follows (in thousands, except earnings per share): December 31, 2020 2019 Basic earnings per share Income available to common shareholder $ 2,665 $ 1,949 Weighted average shares outstanding 5,185 5,142 Basic earnings per share $ 0.51 $ 0.38 Diluted earnings per share Income available to common shareholder $ 2,665 $ 1,949 Weighted average shares outstanding 5,185 5,142 Dilutive effect of restricted stock 2 5 Total weighted average shares outstanding 5,187 5,147 Diluted earnings per share $ 0.51 $ 0.38 There was no restricted stock excluded from the diluted earnings per share calculation for the years ended December 31, 2020 and December 31, 2019. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Business | Smith-Midland Corporation and its wholly-owned subsidiaries (the “Company”) develop, manufacture, license, sell and install precast concrete products for the construction, transportation and utilities industries in the Mid-Atlantic, Northeastern, Midwestern and Southeastern regions of the United States. |
Principles of Consolidation | The accompanying consolidated financial statements include the accounts of Smith-Midland Corporation and its wholly-owned subsidiaries. The Company’s wholly-owned subsidiaries consist of Smith-Midland Corporation, a Virginia corporation, Smith-Carolina Corporation, a North Carolina corporation, Smith-Columbia Corporation, a South Carolina corporation, Easi-Set Industries, Inc., a Virginia corporation, Concrete Safety Systems, Inc., a Virginia corporation, and Midland Advertising and Design, Inc., doing business as Midland Advertising + Design, a Virginia corporation. All material intercompany accounts and transactions have been eliminated in consolidation. |
Cash | The Company considers all unrestricted cash and money market accounts purchased with an original or remaining maturities of three months or less as cash. |
Investments | Investments in marketable securities are classified as available-for-sale and are stated at market value. |
Inventories | Inventories are stated at the lower of cost, using the first-in, first-out (FIFO) method, or net realizable value. Inventory reserves (in thousands) were approximately $72 at December 31, 2020 and 2019. |
Property and Equipment | Property and equipment is stated at cost. Expenditures for ordinary maintenance and repairs are charged to income as incurred. Costs of improvements, renewals, and major replacements are capitalized. At the time properties are retired or otherwise disposed of, the related cost and allowance for depreciation are eliminated from the accounts and any gain or loss on disposition is reflected in income. Depreciation expense is computed using the straight-line method over the following estimated useful lives: Years Buildings 10-40 Trucks and automotive equipment 3-10 Shop machinery and equipment 3-10 Land improvements 10-15 Rental equipment 5-10 Office equipment 3-10 |
Income Taxes | Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. As of December 31, 2020, the Company has not identified any uncertain tax positions. The Company files tax returns in the U.S. Federal and various state jurisdictions. The Company recognizes, when applicable, interest and penalties related to income taxes in other income (expense) in its consolidated statement of income. The Company is no longer subject to U.S. or state tax examinations for the years prior to 2017. The Company does not have any uncertain tax positions as of December 31, 2020, and believes there will be no material changes in unrecognized tax positions over the next twelve months. |
Stock Compensation | On October 13, 2016, the Board of Directors of the Company adopted the 2016 Equity Incentive Plan which allows the Company to grant up to 400,000 shares of common stock of the Company to employees, officers, directors and consultants. The grants may be in the form of restricted or performance shares of common stock of the Company. The fair value of each restricted stock grant is estimated to be the sales price of the common stock at the close of business on the day of the grant. |
Revenue Recognition | Product Sales - Over Time Under Topic 606, the Company recognizes revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services provided. Revenue associated with contracts with customers is recognized over time as the Company's performance creates or enhances customer controlled assets or creates or enhances an asset with no alternative use, which the Company has an enforceable right to receive compensation as defined under the contract for performance completed. To determine the amount of revenue to recognize over time, the Company recognizes revenue over the contract terms based on the output method. The Company applied the "as invoiced" practical expedient as the amount of consideration the Company has the right to invoice corresponds directly with the value of the Company's performance to date. As the output method is driven by units produced, the Company recognizes revenues based on the value transferred to the customer relative to the remaining value to be transferred. The Company also matches the costs associated with the units produced. If a contract is projected to result in a loss, the entire contract loss is recognized in the period when the loss was first determined and the amount of the loss updated in subsequent reporting periods. Revenue recognition also includes an amount related to a contract asset or contract liability. If the recognized revenue is greater than the amount billed to the customer, a contract asset is recorded in accounts receivable - unbilled. Conversely, if the amount billed to the customer is greater than the recognized revenue, a contract liability is recorded in customer deposits on uncompleted contracts. Changes in the job performance, job conditions and final contract settlements are factors that influence management’s assessment of total contract value and therefore, profit and revenue recognition. A portion of the work the Company performs requires financial assurances in the form of performance and payment bonds or letters of credit at the time of execution of the contract. Some contracts include retention provisions of up to 10% which are generally withheld from each progress payment as retainage until the contract work has been completed and approved. Product Sales - Point in Time For certain product sales that do not meet the over time criteria, under Topic 606 the Company recognizes revenue when the product has been shipped to the destination in accordance with the terms outlined in the contract where a present obligation to pay exists and the customers have gained control of the product. Accounts Receivable and Contract Balances The timing of when we bill our customers is generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of the work, or when services are provided or products are shipped. Projects with performance obligations recognized over time that have costs and estimated earnings recognized to date in excess of cumulative billings, are reported on our Condensed Consolidated Balance Sheets as "Accounts receivable trade - unbilled" (contract assets). Projects with performance obligations recognized over time that have cumulative billings in excess of costs and estimate earnings recognized to date, are reported on our Condensed Consolidated Balance Sheets as "Customer deposits" (contract liabilities). Any uncollected billed amounts for our performance obligations recognized over time, including contract retentions, are recorded within accounts receivable trade - billed. At December 31, 2020 and December 31, 2019, accounts receivable included contract retentions (in thousands) of approximately $1,709 and $2,146, respectively, which are considered contract assets. Our billed and unbilled revenue may be exposed to potential credit risk if our customers should encounter financial difficulties, and we maintain reserves for specifically-identified potential uncollectible receivables. At December 31, 2020 and December 31, 2019, our allowances for doubtful accounts (in thousands) were $397 and $333, respectively. Sale to Customer with a Buy-Back Guarantee - Lease Income The Company entered into a buy-back agreement with one specific customer. Under this agreement, the Company guaranteed to buy-back product at a predetermined price at the end of the long-term project, subject to the condition of the product. Although the Company receives payment in full as the product is produced, we are required to account for these transactions as operating leases. The amount of sale proceeds equal to the buy-back obligation, included in "Deferred buy-back lease obligation" in the liabilities section of the consolidated balance sheet, is deferred until the buy-back is exercised or expired. The remaining sale proceeds are deferred in the same account and recognized on a straight-line basis over the usage period, such usage period commencing on delivery to the job-site and ending at the time the buy-back is exercised or expired. The Company capitalizes the cost of the product on the consolidated balance sheet shown in "Deferred buy-back lease asset, net", and depreciates the value, less residual value, to cost of leasing revenue in "Cost of goods sold" over the estimated useful life of the asset. In the case the customer does not exercise the buy-back option and retains ownership of the product at the end of the usage period, the guarantee buy-back liability and any deferred revenue balances related to the product are settled to revenue, and the net book value of the asset is expensed to cost of leasing revenue. If the customer exercises the buy-back guarantee option, the Company purchases the product back in the amount equal to the buy-back guarantee, the Company settles any remaining deferred balances, in excess of the buy-back payment, to leasing revenue, and the Company reclassifies the net book value of the product on the consolidated balance sheet to "Inventories" or "Property and equipment, net" depending on the intended use at the time. The revenue is being recognized in accordance with Topic 842, Leases Barrier Rentals - Lease Income Leasing fees are paid by customers at the beginning of the lease agreement and are recorded as deferred revenue. The deferred revenue is then recognized each month as lease income for the duration of the lease, in accordance with Topic 842, Leases Royalty Income The Company licenses certain products to other precast companies to produce the Company's products to engineering specifications under the licensing agreements. The agreements are typically for five year terms and require royalty payments from 4% to 6% of total sales of licensed products, which are paid on a monthly basis. The revenues from licensing agreements are recognized in the month earned, in accordance with Topic 606-10-55-65. Shipping and Installation Shipping and installation revenues are recognized as a distinct performance obligation in the period the shipping and installation services are provided to the customer, in accordance with Topic 606. Disaggregation of Revenue In the following table, revenue is disaggregated by primary sources of revenue (in thousands): Revenue by Type 2020 2019 Change % Change Product Sales: Soundwall Sales $ 7,499 $ 7,736 $ (237 ) (3 )% Architectural Sales 3,668 1,104 2,564 232 % SlenderWall Sales 948 5,063 (4,115 ) (81 )% Miscellaneous Wall Sales 3,371 1,685 1,686 100 % Barrier Sales 5,507 8,582 (3,075 ) (36 )% Easi-Set and Easi-Span Building Sales 2,935 5,937 (3,002 ) (51 )% Utility Sales 1,310 1,608 (298 ) (19 )% Miscellaneous Sales 1,538 513 1,025 199 % Total Product Sales 26,776 32,228 (5,452 ) (17 )% Barrier Rentals 6,879 2,488 4,391 176 % Royalty Income 1,688 1,672 16 1 % Shipping and Installation Revenue 8,519 10,303 (1,784 ) (17 )% Total Service Revenue 17,086 14,463 2,623 18 % Total Revenue $ 43,862 $ 46,691 $ (2,829 ) (6 )% Smith-Midland products are typically sold pursuant to an implicit warranty as to merchantability only. Warranty claims are reviewed and resolved on a case by case method. Although the Company does incur costs for these types of expense, historically the amount of expense is minimal. The revenue items: soundwall sales, architectural sales, SlenderWall sales, miscellaneous wall sales, barrier rentals, and royalty income are recognized as revenue over time. The revenue items: barrier sales, Easi-Set and Easi-Span building sales, utility sales, miscellaneous sales, and shipping and installation revenue are recognized as revenue at a point in time. |
Sales and Use Taxes | The Company does report sales taxes as part of revenue and use taxes on construction materials are reported gross in cost of goods sold. |
Segment Reporting | Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and assess performance. The Company currently operates in one operating and reportable business segment for financial reporting purposes. |
Risks and Uncertainties | On January 30, 2020, the World Health Organization ("WHO") announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the "COVID-19 outbreak") and on March 11, 2020, the WHO classified the COVID-19 outbreak as a pandemic. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global responses to curb its spread, the Company is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or liquidity for fiscal year 2021. The Company sells products to highway contractors operating under government funded highway programs and other customers and extends credit based on an evaluation of the customer’s financial condition, generally without requiring collateral. Exposure to losses on receivables is principally dependent on each customer’s financial condition. The Company monitors its exposure to credit losses and maintains allowances for anticipated losses. Management reviews accounts receivable on a regular basis to determine the probability of collection. In performing this evaluation, the Company analyzes the payment history and its significant past due accounts, subsequent cash collections on these accounts, comparative accounts receivable aging statistics, and other customer specific considerations existing and known as of the time of the analysis. Based on this information, along with other related factors, the Company develops what it considers to be a reasonable estimate of the uncollectible amounts included in accounts receivable. Management believes the allowance for doubtful accounts at December 31, 2020 is adequate. However, actual write-offs may exceed the recorded allowance. Due to inclement weather, the Company may experience reduced revenue from December through February and may realize the substantial part of its revenue during the other months of the year. |
Fair Value of Financial Instruments | The carrying value for each of the Company’s financial instruments approximates fair value because of the short-term nature of those instruments. The estimated fair value of the long-term debt approximates carrying value based on current rates offered to the Company for debt of similar maturities. |
Estimates | The preparation of financial statements in conformity with U.S. generally accepted accounting (U.S. GAAP) principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Advertising Costs | The Company expenses all advertising costs as incurred. Advertising expense (in thousands) was approximately $383 and $393 in 2020 and 2019, respectively. |
Earnings Per Share | Earnings per share are based on the weighted average number of shares of common stock and dilutive common stock equivalents outstanding. Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflect the potential dilution of securities that could share in earnings of the Company. |
Long-Lived Assets | The Company reviews the carrying values of its long-lived and identifiable intangible assets for possible impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable based on undiscounted estimated future operating cash flows. When any such impairment exists, the related assets will be written down to fair value. No impairment losses have been recorded during the two years ended December 31, 2020. |
Recent Accounting Pronouncements | The FASB issued ASU No. 2016-13, “ Measurement of Credit Losses on Financial Instruments |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Property and equipment estimated useful lives | Years Buildings 10-40 Trucks and automotive equipment 3-10 Shop machinery and equipment 3-10 Land improvements 10-15 Rental equipment 5-10 Office equipment 3-10 |
Disaggregation of revenue | Revenue by Type 2020 2019 Change % Change Product Sales: Soundwall Sales $ 7,499 $ 7,736 $ (237 ) (3 )% Architectural Sales 3,668 1,104 2,564 232 % SlenderWall Sales 948 5,063 (4,115 ) (81 )% Miscellaneous Wall Sales 3,371 1,685 1,686 100 % Barrier Sales 5,507 8,582 (3,075 ) (36 )% Easi-Set and Easi-Span Building Sales 2,935 5,937 (3,002 ) (51 )% Utility Sales 1,310 1,608 (298 ) (19 )% Miscellaneous Sales 1,538 513 1,025 199 % Total Product Sales 26,776 32,228 (5,452 ) (17 )% Barrier Rentals 6,879 2,488 4,391 176 % Royalty Income 1,688 1,672 16 1 % Shipping and Installation Revenue 8,519 10,303 (1,784 ) (17 )% Total Service Revenue 17,086 14,463 2,623 18 % Total Revenue $ 43,862 $ 46,691 $ (2,829 ) (6 )% |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and equipment | December 31, 2020 2019 Land and land improvements $ 3,764 $ 2,688 Buildings and improvements 8,930 8,962 Machinery and equipment 13,952 13,621 Rental equipment 5,895 5,201 32,541 30,472 Less: accumulated depreciation and amortization (13,939 ) (12,737 ) $ 18,602 $ 17,735 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Notes Payable [Abstract] | |
Notes payable | December 31, 2020 2019 Note payable to Summit Community Bank (the "Bank"), maturing September 2021; with monthly payments of approximately $26 of principal and interest fixed at 3.99%; collateralized by principally all assets of the Company. $ 227 $ 519 Note payable to the Bank, maturing July 2031; with monthly payments of approximately $11 of principal and interest fixed at 5.29%; collateralized by principally all assets of Smith-Columbia Corporation and guaranteed by the Company. 1,103 Note payable to the Bank, maturing October 2029; with monthly payments of approximately $22 of principal and interest fixed at 3.64% under a swap agreement; collateralized by principally all assets of Smith-Carolina Corporation and guaranteed by the Company. 2,008 2,197 Note payable to the Bank, maturing March 2030; with monthly payments of approximately $27 of principal and interest fixed at 3.99%; collateralized by principally all assets of the Company. 2,535 Installment notes, collateralized by certain machinery and equipment maturing at various dates; with monthly payments varying from $0.7 to $6.2 with annual interest rates between 2.90% and 5.29%. 166 1,192 A revolving line-of-credit evidenced by a note payable to the Bank, with the maximum amount of $4,000, maturing October 1, 2021, with interest only payments and an initial rate of 4.49% adjustable monthly (4.75% at December 31, 2020). The line-of-credit is collateralized by a first lien position on the Company's accounts receivable and inventory and a second lien position on all other business assets. 4,936 5,011 Less current maturities (740 ) (925 ) $ 4,196 $ 4,086 |
Maturities of notes payable | Year Ending December 31, 2020 $ 740 2021 471 2022 483 2023 496 2024 511 Thereafter 2,235 $ 4,936 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Components of income tax expense (benefit) | December 31, 2020 2019 Federal: Current $ 212 $ (1 ) Deferred 416 440 628 439 State: Current 340 91 Deferred 159 19 499 110 $ 1,127 $ 549 |
Effective income tax rate reconciliation | December 31, 2020 2019 Income taxes at statutory rate $ 796 21.0 % $ 527 21.0 % Increase (decrease) in taxes resulting from: State income taxes, net of federal benefit 443 11.7 % 81 3.2 % Other prior year adjustments 184 4.9 % (127 ) (5.1 )% Provision-to-return (33 ) (0.9 )% 81 3.2 % Rate change (42 ) (1.7) % CARES Act Benefit (253 ) (6.7 )% Other (10 ) (0.3 )% 29 1.3 % $ 1,127 29.7 % $ 549 21.9 % |
Deferred tax assets (liabilities) | December 31, 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 26 $ 21 Allowance for doubtful accounts 100 81 Amortization - Intangibles 4 Charitable contributions 43 Accrued liabilities 7 Accrued vacation 60 76 Deferred buy-back asset 1,259 1,776 Deferred income 314 304 Right-of-use asset 75 91 Other 80 83 Gross deferred tax assets 1,914 2,486 Deferred tax liabilities: Retainage (424 ) (518 ) Deferred buy-back obligation (1,069 ) (1,421 ) Fixed assets (2,685 ) (2,236 ) Prepaids (114 ) (104 ) Amortization - Intangibles (8 ) Unrealized gain loss (2 ) Lease liability (75 ) (91 ) Gross deferred tax liabilities (4,375 ) (4,372 ) Valuation allowance Net deferred tax liability $ (2,461 ) $ (1,886 ) |
Stock Compensation (Tables)
Stock Compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Compensation Related Costs [Abstract] | |
Restricted stock award activity | Number of Shares Weighted Average Grant Date Fair Value per Share Non-vested, December 31, 2018 69,500 $ 5.19 Granted 2,000 7.43 Vested 51,499 5.27 Forfeited 334 4.95 Non-vested, December 31, 2019 19,667 5.45 Granted 54,500 8.98 Vested 37,831 7.14 Forfeited Non-vested, December 31, 2020 36,336 $ 8.98 |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value disclosures | As of December 31, 2020 Quoted Market Prices in Active Markets Internal Models with Significant Observable Internal Models Total Fair Value Mutual Funds $ 1,228 $ — $ — $ 1,228 As of December 31, 2019 Quoted Market Prices in Active Markets (Level 1) Internal Models with Significant Observable (Level 2) Internal Models (Level 3) Total Fair Value Reported in Financial Statements Mutual Funds $ 1,176 $ — $ — $ 1,176 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per share | December 31, 2020 2019 Basic earnings per share Income available to common shareholder $ 2,665 $ 1,949 Weighted average shares outstanding 5,185 5,142 Basic earnings per share $ 0.51 $ 0.38 Diluted earnings per share Income available to common shareholder $ 2,665 $ 1,949 Weighted average shares outstanding 5,185 5,142 Dilutive effect of restricted stock 2 5 Total weighted average shares outstanding 5,187 5,147 Diluted earnings per share $ 0.51 $ 0.38 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Buildings | Minimum | |
Useful life | 10 years |
Buildings | Maximum | |
Useful life | 40 years |
Trucks and Automotive Equipment | Minimum | |
Useful life | 3 years |
Trucks and Automotive Equipment | Maximum | |
Useful life | 10 years |
Shop Machinery and Equipment | Minimum | |
Useful life | 3 years |
Shop Machinery and Equipment | Maximum | |
Useful life | 10 years |
Land Improvements | Minimum | |
Useful life | 10 years |
Land Improvements | Maximum | |
Useful life | 15 years |
Rental Equipment | Minimum | |
Useful life | 5 years |
Rental Equipment | Maximum | |
Useful life | 10 years |
Office Equipment | Minimum | |
Useful life | 3 years |
Office Equipment | Maximum | |
Useful life | 10 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Total revenues | $ 43,862 | $ 46,691 |
Change | $ (2,829) | |
Percent of change | (6.00%) | |
Product Sales | ||
Total revenues | $ 26,776 | 32,228 |
Change | $ (5,452) | |
Percent of change | (17.00%) | |
Product Sales | Soundwall Sales | ||
Total revenues | $ 7,499 | 7,736 |
Change | $ (237) | |
Percent of change | (3.00%) | |
Product Sales | Architectural Sales | ||
Total revenues | $ 3,668 | 1,104 |
Change | $ 2,564 | |
Percent of change | 232.00% | |
Product Sales | SlenderWall Sales | ||
Total revenues | $ 948 | 5,063 |
Change | $ (4,115) | |
Percent of change | (81.00%) | |
Product Sales | Miscellaneous Wall Sales | ||
Total revenues | $ 3,371 | 1,685 |
Change | $ 1,686 | |
Percent of change | 100.00% | |
Product Sales | Barrier Sales | ||
Total revenues | $ 5,507 | 8,582 |
Change | $ (3,075) | |
Percent of change | (36.00%) | |
Product Sales | Easi-Set and Easi-Span Building Sales | ||
Total revenues | $ 2,935 | 5,937 |
Change | $ (3,002) | |
Percent of change | (51.00%) | |
Product Sales | Utility Sales | ||
Total revenues | $ 1,310 | 1,608 |
Change | $ (298) | |
Percent of change | (19.00%) | |
Product Sales | Miscellaneous Sales | ||
Total revenues | $ 1,538 | 513 |
Change | $ 1,025 | |
Percent of change | 199.00% | |
Service Revenue | ||
Total revenues | $ 17,086 | 14,463 |
Change | $ 2,623 | |
Percent of change | 18.00% | |
Service Revenue | Barrier Rentals | ||
Total revenues | $ 6,879 | 2,488 |
Change | $ 4,391 | |
Percent of change | 176.00% | |
Service Revenue | Royalty Income | ||
Total revenues | $ 1,688 | 1,672 |
Change | $ 16 | |
Percent of change | 1.00% | |
Service Revenue | Shipping and Installation Revenue | ||
Total revenues | $ 8,519 | $ 10,303 |
Change | $ (1,784) | |
Percent of change | (17.00%) |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||
Inventory reserve | $ 72 | $ 72 |
Contract retentions | 1,709 | 2,146 |
Allowances for doubtful accounts | 397 | 333 |
Advertising costs | $ 383 | $ 393 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property and equipment, gross | $ 32,541 | $ 30,472 |
Less: accumulated depreciation and amortization | (13,939) | (12,737) |
Property and equipment, net | 18,602 | 17,735 |
Land and Land Improvements | ||
Property and equipment, gross | 3,764 | 2,688 |
Buildings and Improvements | ||
Property and equipment, gross | 8,930 | 8,962 |
Machinery and Equipment | ||
Property and equipment, gross | 13,952 | 13,621 |
Rental Equipment | ||
Property and equipment, gross | $ 5,895 | $ 5,201 |
Property and Equipment (Detai_2
Property and Equipment (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation and amortization | $ 2,412 | $ 1,793 |
Notes Payable (Details)
Notes Payable (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Notes payable | $ 4,936 | $ 5,011 |
Less: current maturities | (740) | (925) |
Noncurrent notes payable | 4,196 | 4,086 |
Note Payable 1 | ||
Notes payable | 227 | 519 |
Note Payable 2 | ||
Notes payable | 0 | 1,103 |
Note Payable 3 | ||
Notes payable | 2,008 | 2,197 |
Note Payable 4 | ||
Notes payable | 2,535 | 0 |
Note Payable 5 | ||
Notes payable | 166 | 1,192 |
Note Payable 6 | ||
Notes payable | $ 0 | $ 0 |
Notes Payable (Details 1)
Notes Payable (Details 1) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Notes Payable [Abstract] | ||
2020 | $ 740 | |
2021 | 471 | |
2022 | 483 | |
2023 | 496 | |
2024 | 511 | |
Thereafter | 2,235 | |
Notes payable | $ 4,936 | $ 5,011 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Federal: | ||
Current | $ 212 | $ (1) |
Deferred | 416 | 440 |
Federal income taxes | 628 | 439 |
State: | ||
Current | 340 | 91 |
Deferred | 159 | 19 |
State income taxes | 499 | 110 |
Income tax expense | $ 1,127 | $ 549 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Income taxes at statutory rate | $ 796 | $ 527 |
State income taxes, net of federal benefit | 443 | 81 |
Other prior year adjustments | 184 | (127) |
Provision-to-return | (33) | 81 |
Rate change | 0 | (42) |
CARES Act benefit | (253) | 0 |
Other | (10) | 29 |
Income tax expense | $ 1,127 | $ 549 |
Income taxes at statutory rate | 21.00% | 21.00% |
State income taxes, net of federal benefit | 11.70% | 3.20% |
Other prior year adjustments | 4.90% | (5.10%) |
Provision-to-return | (0.90%) | 3.20% |
Rate change | 0.00% | (1.70%) |
CARES Act benefit | (6.70%) | 0.00% |
Other | (0.30%) | 1.30% |
Effective income tax rate | 29.70% | 21.90% |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 26 | $ 21 |
Allowance for doubtful accounts | 100 | 81 |
Amortization - intangibles | 0 | 4 |
Charitable contributions | 0 | 43 |
Accrued liabilities | 0 | 7 |
Accrued vacation | 60 | 76 |
Deferred buy-back asset | 1,259 | 1,776 |
Deferred income | 314 | 304 |
Right-of-use asset | 75 | 91 |
Other | 80 | 83 |
Gross deferred tax assets | 1,914 | 2,486 |
Deferred tax liabilities: | ||
Retainage | (424) | (518) |
Deferred buy-back obligation | (1,069) | (1,421) |
Fixed assets | (2,685) | (2,236) |
Prepaids | (114) | (104) |
Amortization - intangibles | (8) | 0 |
Unrealized gain loss | 0 | (2) |
Lease liability | (75) | (91) |
Gross deferred tax liabilities | (4,375) | (4,372) |
Valuation allowance | 0 | 0 |
Net deferred tax liability | $ (2,461) | $ (1,886) |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) $ in Thousands | Dec. 31, 2020USD ($) |
Income Tax Disclosure [Abstract] | |
State net operating loss carryforward | $ 2,611 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Employee Benefit and Share-based Payment Arrangement, Noncash Expense [Abstract] | ||
Employer matching contribution, percent of match | 50.00% | 50.00% |
Employer matching contribution, percent of employees' gross pay | 4.00% | 4.00% |
Match contributions | $ 183 | $ 179 |
Stock Compensation (Details)
Stock Compensation (Details) - Restricted Stock Awards - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Non-vested, Number of Shares | ||
Non-vested, beginning of period | 19,667 | 69,500 |
Granted | 54,500 | 2,000 |
Vested | 37,831 | 51,499 |
Forfeited | 0 | 334 |
Non-vested, end of period | 36,336 | 19,667 |
Non-vested, Weighted Average Grant Date Fair Value | ||
Non-vested, beginning of period | $ 5.45 | $ 5.19 |
Granted | 8.98 | 7.43 |
Vested | 7.14 | 5.27 |
Forfeited | .00 | 4.95 |
Non-vested, ending of period | $ 8.98 | $ 5.45 |
Stock Compensation (Details Nar
Stock Compensation (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Compensation Related Costs [Abstract] | ||
Intrinsic value of restricted stock outstanding | $ 326 | |
Stock compensation | 163 | $ 270 |
Unrecognized compensation cost related to non-vested restricted stock | $ 326 |
Fair Value Disclosures (Details
Fair Value Disclosures (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Mutual funds | $ 1,228 | $ 1,176 |
Level 1 | ||
Mutual funds | 1,228 | 1,176 |
Level 2 | ||
Mutual funds | 0 | 0 |
Level 3 | ||
Mutual funds | $ 0 | $ 0 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Basic earnings per share | ||
Income available to common shareholder | $ 2,665 | $ 1,959 |
Weighted average shares outstanding (in thousands) | 5,185 | 5,142 |
Basic earnings per share | $ .51 | $ 0.38 |
Diluted earnings per share | ||
Income available to common shareholder | $ 2,665 | $ 1,959 |
Weighted average shares outstanding (in thousands) | 5,185 | 5,142 |
Dilutive effect of stock options and restricted stock (in thousands) | 2 | 5 |
Total weighted average shares outstanding (in thousands) | 5,187 | 5,147 |
Diluted earnings per share | $ .51 | $ 0.38 |