Price | 5.17 | EPS | -1 | |
Shares | 10 | P/E | -7 | |
MCap | 50 | P/FCF | -22 | |
Net Debt | -4 | EBIT | -7 | |
TEV | 46 | TEV/EBIT | -7 | TTM 2019-09-30, in MM, except price, ratios |
10-Q | 2020-09-30 | Filed 2020-11-16 |
10-K | 2020-06-30 | Filed 2020-09-28 |
10-Q | 2020-03-31 | Filed 2020-06-01 |
10-Q | 2019-12-31 | Filed 2020-02-10 |
10-Q | 2019-09-30 | Filed 2019-11-12 |
10-K | 2019-06-30 | Filed 2019-09-12 |
10-Q | 2019-03-31 | Filed 2019-05-09 |
10-Q | 2018-12-31 | Filed 2019-02-11 |
10-Q | 2018-09-30 | Filed 2018-11-07 |
10-K | 2018-06-30 | Filed 2018-08-30 |
10-Q | 2018-03-31 | Filed 2018-05-07 |
10-Q | 2017-12-31 | Filed 2018-02-05 |
10-Q | 2017-09-30 | Filed 2017-11-06 |
10-K | 2017-06-30 | Filed 2017-09-07 |
10-Q | 2017-03-31 | Filed 2017-05-08 |
10-Q | 2016-12-31 | Filed 2017-02-06 |
10-Q | 2016-09-30 | Filed 2016-11-07 |
10-K | 2016-06-30 | Filed 2016-09-09 |
10-Q | 2016-03-31 | Filed 2016-05-09 |
10-Q | 2015-12-31 | Filed 2016-02-09 |
10-Q | 2015-09-30 | Filed 2015-11-09 |
10-K | 2015-06-30 | Filed 2015-09-14 |
10-Q | 2015-03-31 | Filed 2015-05-08 |
10-Q | 2014-12-31 | Filed 2015-02-09 |
10-Q | 2014-09-30 | Filed 2014-11-10 |
10-K | 2014-06-30 | Filed 2014-09-15 |
10-Q | 2014-03-31 | Filed 2014-05-15 |
10-Q | 2013-12-31 | Filed 2014-02-14 |
10-Q | 2013-09-30 | Filed 2013-11-14 |
10-K | 2013-06-30 | Filed 2013-09-27 |
10-Q | 2013-03-31 | Filed 2013-05-15 |
10-Q | 2012-12-31 | Filed 2013-02-14 |
10-Q | 2012-09-30 | Filed 2012-11-13 |
10-K | 2012-06-30 | Filed 2012-09-28 |
10-Q | 2012-03-31 | Filed 2012-05-15 |
10-Q | 2011-12-31 | Filed 2012-02-13 |
10-Q | 2011-09-30 | Filed 2011-11-14 |
10-K | 2011-06-30 | Filed 2011-09-26 |
10-Q | 2011-03-31 | Filed 2011-05-16 |
10-Q | 2010-12-31 | Filed 2011-02-11 |
10-Q | 2010-09-30 | Filed 2010-11-15 |
10-K | 2010-06-30 | Filed 2010-09-27 |
10-Q | 2010-03-31 | Filed 2010-05-14 |
10-Q | 2009-12-31 | Filed 2010-02-16 |
8-K | 2020-11-16 | |
8-K | 2020-09-28 | |
8-K | 2020-09-27 | |
8-K | 2020-09-01 | |
8-K | 2020-06-05 | |
8-K | 2020-05-28 | |
8-K | 2020-05-04 | |
8-K | 2020-04-16 | |
8-K | 2020-02-24 | |
8-K | 2020-02-04 | |
8-K | 2020-01-07 | |
8-K | 2019-12-19 | |
8-K | 2019-11-22 | |
8-K | 2019-11-18 | |
8-K | 2019-11-11 | |
8-K | 2019-11-11 | |
8-K | 2019-09-16 | |
8-K | 2019-09-16 | |
8-K | 2019-09-04 | |
8-K | 2019-09-04 | |
8-K | 2019-08-09 | |
8-K | 2019-07-25 | |
8-K | 2019-06-13 | |
8-K | 2019-05-16 | |
8-K | 2019-05-09 | |
8-K | 2019-02-11 | |
8-K | 2018-12-20 | |
8-K | 2018-12-07 | |
8-K | 2018-10-25 | |
8-K | 2018-08-29 | |
8-K | 2018-08-20 | |
8-K | 2018-08-09 | |
8-K | 2018-06-21 | |
8-K | 2018-05-07 | |
8-K | 2018-04-04 | |
8-K | 2018-02-05 |
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations |
Item 4. Controls and Procedures |
Part II. Other Information |
Item 1A. Risk Factors |
Item 6. Exhibits |
EX-31.1 | prcp-ex311_6.htm |
EX-31.2 | prcp-ex312_75.htm |
EX-32.1 | prcp-ex321_76.htm |
Balance Sheet | Income Statement | Cash Flow |
---|---|---|
Assets, Equity
|
Rev, G Profit, Net Income
|
Ops, Inv, Fin
|
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ___________ to ___________
Commission file number:
PERCEPTRON, INC.
(Exact Name of Registrant as Specified in Its Charter)
(State or Other Jurisdiction of Incorporation or Organization) |
| (I.R.S. Employer Identification No.) |
(Address of Principal Executive Offices) |
| (Zip Code) |
(
(Registrant’s Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| | |
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
| No ☐ |
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
| No ☐ |
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer | ☐ |
| Accelerated filer | ☐ |
|
|
|
|
|
| ☑ |
| Smaller reporting company | |
|
|
|
|
|
Emerging growth company | |
|
|
|
If an emerging growth company, indicated by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes | No☑ |
As of November 10, 2020, there were
1
PERCEPTRON, INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
For the Quarter Ended September 30, 2020
|
| Page Number |
| 1 | |
|
|
|
| 2 | |
|
|
|
|
| |
| 3 | |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
| 21 |
| 27 | |
|
|
|
|
| |
| 28 | |
| 29 | |
|
|
|
| 30 |
2
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
|
| September 30, |
|
| June 30, |
| ||
(In Thousands, Except Per Share Amount) |
| 2020 |
|
| 2020 |
| ||
|
| (unaudited) |
|
|
|
|
| |
ASSETS |
|
|
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
| $ | |
|
| $ | |
|
Short-term investments |
|
| |
|
|
| |
|
Receivables: |
|
|
|
|
|
|
|
|
Billed receivables, net of allowance for doubtful accounts of $ |
|
| |
|
|
| |
|
Unbilled receivables, net |
|
| |
|
|
| |
|
Other receivables |
|
| |
|
|
| |
|
Inventories, net of reserves of $ |
|
| |
|
|
| |
|
Other current assets |
|
| |
|
|
| |
|
Total current assets |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Property and Equipment, Net |
|
| |
|
|
| |
|
Intangible Assets, Net |
|
| |
|
|
| |
|
Right of Use Assets |
|
| |
|
|
| |
|
Long-Term Investment |
|
| |
|
|
| |
|
Long-Term Deferred Income Tax Assets |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Total Assets |
| $ | |
|
| $ | |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
|
|
Line of credit and current portion of long-term debt |
| $ | |
|
| $ | |
|
Accounts payable |
|
| |
|
|
| |
|
Accrued liabilities and expenses |
|
| |
|
|
| |
|
Accrued compensation |
|
| |
|
|
| |
|
Current portion of taxes payable |
|
| |
|
|
| |
|
Income taxes payable |
|
| |
|
|
| |
|
Short-term operating lease liability |
|
| |
|
|
| |
|
Reserves for restructuring and other charges |
|
| |
|
|
| |
|
Deferred revenue |
|
| |
|
|
| |
|
Total current liabilities |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Long-Term Deferred Income Tax Liability |
|
| |
|
|
| |
|
Long-Term Operating Lease Liability |
|
| |
|
|
| |
|
Long-Term Deferred Revenue |
|
| |
|
|
| |
|
Long-Term Debt, Less Current Portion |
|
| |
|
|
| |
|
Other Long-Term Liabilities |
|
| |
|
|
| |
|
Total Liabilities |
| $ | |
|
| $ | |
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity |
|
|
|
|
|
|
|
|
Preferred stock, no par value, authorized |
|
| |
|
|
| |
|
Common stock, $ |
|
| |
|
|
| |
|
Accumulated other comprehensive loss |
|
| ( | ) |
|
| ( | ) |
Additional paid-in capital |
|
| |
|
|
| |
|
Retained deficit |
|
| ( | ) |
|
| ( | ) |
Total Shareholders' Equity |
| $ | |
|
| $ | |
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Shareholders' Equity |
| $ | |
|
| $ | |
|
The notes to the consolidated financial statements are an integral part of these statements.
3
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
|
| Three Months Ended |
| |||||
|
| September 30, |
| |||||
(In Thousands, Except Per Share Amounts) |
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
|
|
|
Net Sales |
| $ | |
|
| $ | |
|
Cost of Sales |
|
| |
|
|
| |
|
Gross Profit |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Operating Expenses |
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
| |
|
|
| |
|
Engineering, research and development |
|
| |
|
|
| |
|
Total operating expenses |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Operating (Loss) Income |
|
| ( | ) |
|
| |
|
|
|
|
|
|
|
|
|
|
Other Income and (Expenses) |
|
|
|
|
|
|
|
|
Interest expense, net |
|
| ( | ) |
|
| ( | ) |
Foreign currency (loss) gain, net |
|
| |
|
|
| ( | ) |
Other income (expense), net |
|
| ( | ) |
|
| |
|
Total other income and (expense) |
|
| |
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
(Loss) Income Before Income Taxes |
|
| ( | ) |
|
| |
|
|
|
|
|
|
|
|
|
|
Income Tax (Expense) Benefit |
|
| |
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Net (Loss) Income |
| $ | ( | ) |
| $ | |
|
|
|
|
|
|
|
|
|
|
(Loss) Income Per Common Share |
|
|
|
|
|
|
|
|
Basic and Diluted |
| $ | ( | ) |
| $ | |
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares Outstanding |
|
|
|
|
|
|
|
|
Basic |
|
| |
|
|
| |
|
Dilutive effect of stock options |
|
| |
|
|
| |
|
Diluted |
|
| |
|
|
| |
|
The notes to the consolidated financial statements are an integral part of these statements.
4
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME
(UNAUDITED)
|
| Three Months Ended |
| |||||
|
| September 30, |
| |||||
(In Thousands) |
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
|
|
|
Net (Loss) Income |
| $ | ( | ) |
| $ | |
|
Other Comprehensive Income (Loss): |
|
|
|
|
|
|
|
|
Foreign currency translation adjustments |
|
| |
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Comprehensive Income (Loss) |
| $ | |
|
| $ | ( | ) |
The notes to the consolidated financial statements are an integral part of these statements.
5
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(UNAUDITED)
|
| Three Months Ended |
| |||||
|
| September 30, |
| |||||
(In Thousands) |
| 2020 |
|
| 2019 |
| ||
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities |
|
|
|
|
|
|
|
|
Net (loss) income |
| $ | ( | ) |
| $ | |
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization, includes $ |
|
| |
|
|
| |
|
Stock compensation expense |
|
| |
|
|
| |
|
Non-cash lease expense |
|
| - |
|
|
| |
|
Deferred income taxes |
|
| ( | ) |
|
| |
|
Loss on disposal of assets |
|
| - |
|
|
| |
|
Allowance for doubtful accounts |
|
| |
|
|
| ( | ) |
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
Receivables |
|
| |
|
|
| ( | ) |
Inventories |
|
| |
|
|
| |
|
Accounts payable |
|
| ( | ) |
|
| |
|
Accrued liabilities and expenses |
|
| ( | ) |
|
| |
|
Deferred revenue |
|
| |
|
|
| |
|
Other assets and liabilities |
|
| ( | ) |
|
| ( | ) |
Net cash (used for) provided by operating activities |
|
| |
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Cash Flows from Investing Activities |
|
|
|
|
|
|
|
|
Purchases of short-term investments |
|
| ( | ) |
|
| ( | ) |
Sales of short-term investments |
|
| |
|
|
| |
|
Capital expenditures |
|
| ( | ) |
|
| ( | ) |
Capital expenditures - intangibles |
|
| - |
|
|
| ( | ) |
Net cash provided by (used for) investing activities |
|
| ( | ) |
|
| |
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing Activities |
|
|
|
|
|
|
|
|
Payments on lines of credit and short-term borrowings, net |
|
| ( | ) |
|
| - |
|
Proceeds from stock plans |
|
| - |
|
|
| |
|
Net cash provided by (used for) financing activities |
|
| ( | ) |
|
| |
|
|
|
|
|
|
|
|
|
|
Effect of Exchange Rate Changes on Cash and Cash Equivalents |
|
| |
|
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash |
|
| |
|
|
| ( | ) |
Cash, Cash Equivalents and Restricted Cash, July 1 |
|
| |
|
|
| |
|
Cash, Cash Equivalents and Restricted Cash, September 30 |
| $ | |
|
| $ | |
|
|
|
|
|
|
|
|
|
|
Supplemental Disclosure of Cash Flow Information |
|
|
|
|
|
|
|
|
Cash paid during the period for interest |
| $ | |
|
| $ | |
|
Cash paid during the period for income taxes |
| $ | |
|
| $ | |
|
|
| September 30, 2020 |
|
| June 30, 2020 |
| ||
Cash and Cash Equivalents |
| $ | |
|
| $ | |
|
Restricted Cash included in Short-term Investments |
|
| |
|
|
| |
|
Total Cash, Cash Equivalents and Restricted Cash |
| $ | |
|
| $ | |
|
|
|
|
|
|
|
|
|
|
The notes to the consolidated financial statements are an integral part of these statements. |
|
6
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(UNAUDITED)
|
| Three Months Ended |
| |||||
|
| September 30, |
| |||||
(In Thousands) |
| 2020 |
|
| 2019 |
| ||
Common Stock |
|
|
|
|
|
|
|
|
Beginning balance |
| $ | |
|
| $ | |
|
Issued |
|
| |
|
|
| - |
|
Ending balance |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Accumulated Other Comprehensive Loss |
|
|
|
|
|
|
|
|
Beginning balance |
|
| ( | ) |
|
| ( | ) |
Other comprehensive income (loss) |
|
| |
|
|
| ( | ) |
Ending balance |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Additional Paid-In Capital |
|
|
|
|
|
|
|
|
Beginning balance |
|
| |
|
|
| |
|
Stock-based compensation |
|
| |
|
|
| |
|
Stock plans |
|
| |
|
|
| |
|
Ending balance |
|
| |
|
|
| |
|
|
|
|
|
|
|
|
|
|
Retained Earnings (Deficit) |
|
|
|
|
|
|
|
|
Beginning balance |
|
| ( | ) |
|
| ( | ) |
Net (loss) income |
|
| ( | ) |
|
| |
|
Ending balance |
|
| ( | ) |
|
| ( | ) |
|
|
|
|
|
|
|
|
|
Total Shareholders' Equity |
| $ | |
|
| $ | |
|
The notes to the consolidated financial statements are an integral part of these statements.
7
PERCEPTRON, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1.Accounting Policies
Perceptron, Inc. (the “Company”) develops, produces and sells a comprehensive range of automated industrial metrology products and solutions to manufacturers for dimensional gauging, dimensional inspection and 3D scanning. The Company’s products provide solutions for manufacturing process control as well as sensor and software technologies for non-contact measurement, scanning and inspection applications. The Company also offer value added services such as training and customer support.
Basis of Presentation and Principles of Consolidation
The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and within the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The Consolidated Financial Statements include accounts of the Company and wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. In the Company’s opinion, these statements include all normal recurring adjustments necessary for a fair presentation of the financial statements for the periods presented. The results of operations for any interim period are not necessarily indicative of the results of operations for a full fiscal year. The accompanying unaudited Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements in Form 10-K for the fiscal year ended June 30, 2020.
Use of Estimates
Management is required to make certain estimates and assumptions under U.S. GAAP during the preparation of these Consolidated Financial Statements. These estimates and assumptions may affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
In particular, management has made estimates and assumptions related to the impact of the novel coronavirus ("COVID-19") on its business. COVID-19 was characterized as a pandemic by the World Health Organization on March 11, 2020. To help lessen its spread, many countries have implemented travel restrictions and/or required companies to limit or suspend business operations. These actions have disrupted supply chains and company operations around the world. The current environment resulting from COVID-19 is unprecedented and comes with a great deal of uncertainty. See Note 18 “COVID-19 Pandemic” of the Notes to the Consolidated Financial Statements, contained in this Quarterly Report on Form 10-Q for a discussion of the impact of COVID-19 on the Company’s business.
2.New Accounting Pronouncements
Recently Issued Accounting Pronouncements
In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments – Credit Losses (Topic 326) (ASU 2016-13), which requires the measurement of all expected credit losses for financial assets held at the reporting date to be based on historical experience, current conditions as well as reasonable and supportable forecasts. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments – Credit Losses (ASU 2018-19). ASU 2018-19 clarifies that receivables arising from operating leases are not within the scope of ASU 2016-13. ASU 2016-13, as amended, is effective for the Company on July 1, 2023, with early adoption permitted. The Company does not expect the impact of the adoption of ASU 2016-13 to be material on its consolidated financial statements.
In November 2019, the FASB issued Accounting Standards Update No. 2019-11—Codification Improvements to Topic 326, Financial Instruments—Credit Losses (ASU 2019-11). The amendments in this Update represent changes to clarify, correct errors in, or improve the Codification. The amendments make the Codification easier to understand and easier to apply by eliminating inconsistencies and providing clarifications. The effective dates and transition requirements for ASU 2019-11 are the same as ASU 2016-13. ASU 2019-11 is effective for the Company on July 1, 2023. The Company does not expect the impact of the adoption of ASU 2019-11 to be material on its consolidated financial statements.
8
In December 2019, the FASB issued Accounting Standards Update No. 2019-12—Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12). The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for the Company on July 1, 2021. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures.
In January 2020, the FASB issued Accounting Standards Update No. 2020-01—Investments—Equity Securities (Topic 321), Investments—Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815)—Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the Emerging Issues Task Force) (ASU 2020-01). The amendments in this ASU clarify certain interactions between the guidance to account for certain equity securities under Topic 321, the guidance to account for investments under the equity method of accounting in Topic 323, and the guidance in Topic 815, which could change how an entity accounts for an equity security under the measurement alternative or a forward contract or purchased option to purchase securities that, upon settlement of the forward contract or exercise of the purchased option, would be accounted for under the equity method of accounting or the fair value option in accordance with Topic 825, Financial Instruments. These amendments improve current GAAP by reducing diversity in practice and increasing comparability of the accounting for these interactions. ASU 2020-01 is effective for the Company on July 1, 2021. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures.
In August 2018, the FASB issued Accounting Standards Update No. 2018-13 – Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirement for Fair Value Measurement (ASU 2018-13), which changes the disclosures related to, among other aspects of fair value, unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurement and the narrative description of measurement uncertainty. ASU 2018-13 is effective for the Company on July 1, 2021. The Company is currently evaluating the impact of this standard on its consolidated financial statements and disclosures.
Recently Adopted Accounting Pronouncements
In February 2016, the FASB issued Accounting Standards Update No. 2016-02 Leases (ASU 2016-2), which establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. The Company adopted this guidance on July 1, 2019, using the modified retrospective approach.
The adoption of the standard resulted in the recognition of net operating lease right-of-use assets of $
The Company elected to apply the package of practical expedients upon transition, which includes no reassessment of whether existing contracts are or contain leases and allowed for the lease classification for existing leases to be retained. The Company did not elect the practical expedient to use hindsight, and accordingly the initial lease term did not differ under the new standard versus prior accounting practice. After transition, in certain instances, the cost of renewal options will be recognized earlier in the term of the lease than under the previous lease accounting rules. The Company has selected as its accounting policy to keep leases with a term of twelve months or less off the balance sheet and recognize these lease payments on a straight-line basis over the lease term.
In February 2018, the FASB issued Accounting Standards Update 2018-02—Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (ASU 2018-02), which allows for a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. ASU 2018-02 was adopted on July 1, 2019 and did not have a significant impact on the Company’s consolidated financial statements or disclosures.
In August 2018, the FASB issued Accounting Standards Update No. 2018-15 – Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract (ASU 2018-15), which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing costs incurred to develop or obtain internal use software. ASU 2018-15 is effective for the Company on July 1, 2020. ASU 2018-15 was adopted on July 1, 2020 and did not have significant impact on the Company’s consolidated financial statements and disclosures.
9
3.Intangible Assets
The Company acquired intangible assets consisting of a Trade Name and Customer/Distributor Relationships in addition to goodwill in connection with the acquisitions of Coord3 and NMS in the third quarter of fiscal 2015 which is considered the Company’s CMM reporting unit. The customer/distributor relationships were written off via an impairment charge in fiscal 2019. The goodwill and trade name were written off via impairment charges in fiscal 2019 and 2020. Furthermore, the Company continues to develop intangibles, primarily software. Intangible assets are susceptible to shortened estimated useful lives and changes in fair value due to changes in their use, market or economic changes, or other events or circumstances. The amortization periods for software is
At September 30, 2020, there are no indications of potential impairment of the Company’s software.
The Company’s intangible assets are as follows (in thousands):
|
| September 30, 2020 |
|
| June 30, 2020 |
| ||||||||||||||||||||||
|
| Gross |
|
|
|
|
|
| Net |
|
| Gross |
|
|
|
|
|
|
|
|
|
| Net |
| ||||
|
| Carrying |
|
| Accumulated |
|
| Carrying |
|
| Carrying |
|
| Impairments |
|
| Accumulated |
|
| Carrying |
| |||||||
|
| Amount |
|
| Amortization |
|
| Amount |
|
| Amount |
|
|
|
|
|
| Amortization |
|
| Amount |
| ||||||
Trade Name |
| $ | - |
|
| $ | - |
|
| $ | - |
|
| $ | |
|
| $ | ( | ) |
| $ | ( | ) |
| $ | - |
|
Software |
|
| |
|
|
| ( | ) |
|
| |
|
|
| |
|
|
| - |
|
|
| ( | ) |
|
| |
|
Total |
| $ | |
|
| $ | ( | ) |
| $ | |
|
| $ | |
|
| $ | ( | ) |
| $ | ( | ) |
| $ | |
|
Amortization expense was $
The estimated amortization of the remaining intangible assets by year is as follows (in thousands):
Years Ending June 30, |
| Amount |
| |
2021 (excluding the three months ended September 30, 2020) |
|
| |
|
2022 |
|
| |
|
2023 |
|
| |
|
2024 |
|
| |
|
2025 |
|
| - |
|
after 2025 |
|
| - |
|
|
| $ | |
|
4.Revenue from Contracts with Customers
Disaggregated Revenue
The following tables summarizes the Company’s disaggregated revenue, based on its shipping location (in thousands):
|
| Three Months Ended September 30, |
| ||||
Geographic Region: |
| 2020 |
| 2019 |
| ||
Americas Sales |
| $ | |
| $ | |
|
Europe Sales |
|
| |
|
| |
|
Asia Sales |
|
| |
|
| |
|
Total Net Sales |
| $ | |
| $ | |
|
Sales by product lines are as follows (in thousands):
|
| Three Months Ended September 30, |
| ||||
Product Lines |
| 2020 |
| 2019 |
| ||
Measurement Solutions |
| $ | |
| $ | |
|
3D Scanning Solutions |
|
| |
|