Perceptron Earnings 2020-03-31

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

prcp-10q_20200331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020

☐	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: 0-20206

PERCEPTRON, INC.

(Exact Name of Registrant as Specified in Its Charter)

Michigan

(State or Other Jurisdiction of

Incorporation or Organization)

38-2381442

(I.R.S. Employer

Identification No.)

47827 Halyard Drive, Plymouth, Michigan

(Address of Principal Executive Offices)

48170-2461

(Zip Code)

(734) 414-6100

(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
Common Stock, $0.01 par value	PRCP	NASDAQ Global Market

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.

Yes ☑

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).

Yes ☑

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	☑

Non-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 May 28, 2020, there were 9,720,914 shares of common stock ($0.01 par value per share) are outstanding.

Explanatory Note

On March 25, 2020, the Securities and Exchange Commission (the “SEC”) issued the Order under Section 36 of the Securities Exchange Act of 1934 Modifying Exemptions from the Reporting and Proxy Delivery Requirements for Public Companies, (Release No. 34-88465) (the “Order”), which provides conditional relief to public companies that are unable to timely comply with certain filing obligations as a result of the COVID-19 pandemic. Due to the ongoing COVID-19 pandemic, Perceptron, Inc. (the “Company”) delayed the filing of this Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 (this “Quarterly Report”) in reliance on the Order.

The Company's operations and business have experienced disruptions due to the ongoing COVID-19 pandemic and the various measures that the countries in which the Company conducts operations have taken in response. The Company has implemented widespread work-from-home arrangements for many of its employees, who are mainly located in the United States, Europe and China. In connection with the preparation of this Quarterly Report, the Company experienced delays in its normal processes and interactions among its accounting personnel and others responsible for preparation of this Quarterly Report. As a result, this Quarterly Report for the three months ended March 31, 2020, which prior to the Order was due on May 11, 2020, has been filed on June 1, 2020.

PERCEPTRON, INC. AND SUBSIDIARIES

INDEX TO FORM 10-Q

For the Quarter Ended March 31, 2020

		Page Number
COVER		1

INDEX		3

PART I. FINANCIAL INFORMATION
Item 1. Financial Statements		4
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		26
Item 4. Controls and Procedures		35

PART II. OTHER INFORMATION
Item 1A. Risk Factors		36
Item 6. Exhibits		38

SIGNATURES		39

PERCEPTRON, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	March 31,			June 30,
(In Thousands, Except Per Share Amount)	2020			2019
	(unaudited)
ASSETS
Current Assets
Cash and cash equivalents	$	10,564		$	4,585
Short-term investments		323			1,431
Receivables:
Billed receivables, net of allowance for doubtful accounts of $550 and $541, respectively		23,922			27,449
Unbilled receivables, net		4,468			5,394
Other receivables		540			200
Inventories, net of reserves of $1,860 and $1,778 respectively		10,072			10,810
Other current assets		1,984			1,529
Total current assets		51,873			51,398

Property and Equipment, Net		5,910			6,538
Goodwill		-			1,741
Intangible Assets, Net		1,176			1,816
Right of Use Assets		3,660			-
Long-Term Investment		725			725
Long-Term Deferred Income Tax Assets		918			620

Total Assets	$	64,262		$	62,838

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Lines of credit		2,500			-
Accounts payable		5,961			7,397
Accrued liabilities and expenses		3,763			3,609
Accrued compensation		1,373			1,646
Current portion of taxes payable		172			320
Income taxes payable		640			536
Short-term operating lease liability		462			-
Reserves for severance and other charges		468			44
Deferred revenue		5,646			6,649
Total current liabilities		20,985			20,201

Long-Term Taxes Payable		-			114
Long-Term Deferred Income Tax Liability		-			41
Long-Term Operating Lease Liability		3,249			-
Long-Term Deferred Revenue		243			-
Other Long-Term Liabilities		439			556
Total Liabilities	$	24,916		$	20,912

Shareholders' Equity
Preferred stock, no par value, authorized 1,000 shares, issued none		-			-
Common stock, $0.01 par value, 19,000 shares authorized; issued and outstanding 9,721 and 9,656, respectively		97			97
Accumulated other comprehensive loss		(3,612	)		(3,079	)
Additional paid-in capital		49,595			49,083
Retained deficit		(6,734	)		(4,175	)
Total Shareholders' Equity	$	39,346		$	41,926

Total Liabilities and Shareholders' Equity	$	64,262		$	62,838

The notes to the consolidated financial statements are an integral part of these statements.

PERCEPTRON, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended						Nine Months Ended
	March 31,						March 31,
(In Thousands, Except Per Share Amounts)	2020			2019			2020			2019
				(As Revised)						(As Revised)
Net Sales	$	12,673		$	15,632		$	49,655		$	58,627
Cost of Sales		8,267			10,485			31,076			37,338
Gross Profit		4,406			5,147			18,579			21,289

Operating Expenses
Selling, general and administrative		4,044			4,415			12,596			13,992
Engineering, research and development		1,472			1,812			4,932			6,090
Severance, impairment and other charges		2,836			-			3,307			(609	)
Total operating expenses		8,352			6,227			20,835			19,473

Operating (Loss) Income		(3,946	)		(1,080	)		(2,256	)		1,816

Other Income and (Expenses)
Interest expense, net		(25	)		(16	)		(92	)		(72	)
Foreign currency loss		(352	)		(127	)		(531	)		(178	)
Other income, net		40			28			164			33
Total other income and (expense)		(337	)		(115	)		(459	)		(217	)

(Loss) Income Before Income Taxes		(4,283	)		(1,195	)		(2,715	)		1,599

Income Tax (Expense) Benefit		347			193			156			(38	)

Net (Loss) Income	$	(3,936	)	$	(1,002	)	$	(2,559	)	$	1,561

(Loss) Income Per Common Share
Basic	$	(0.41	)	$	(0.10	)	$	(0.26	)	$	0.16
Diluted	$	(0.41	)	$	(0.10	)	$	(0.26	)	$	0.16

Weighted Average Common Shares Outstanding
Basic		9,708			9,627			9,687			9,601
Dilutive effect of stock options		-			-			-			110
Diluted		9,708			9,627			9,687			9,711

The notes to the consolidated financial statements are an integral part of these statements.

PERCEPTRON, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(UNAUDITED)

	Three Months Ended						Nine Months Ended
	March 31,						March 31,
(In Thousands)	2020			2019			2020			2019
				(As Revised)						(As Revised)
Net (Loss) Income	$	(3,936	)	$	(1,002	)	$	(2,559	)	$	1,561
Other Comprehensive Income (Loss):
Foreign currency translation adjustments		(217	)		(93	)		(533	)		(859	)

Comprehensive (Loss) Income	$	(4,153	)	$	(1,095	)	$	(3,092	)	$	702

The notes to the consolidated financial statements are an integral part of these statements.

PERCEPTRON, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOW

(UNAUDITED)

	Nine Months Ended
	March 31,
(In Thousands)	2020			2019
				(As Revised)
Cash Flows from Operating Activities
Net (loss) income	$	(2,559	)	$	1,561
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization, includes $388 amortization of ROU assets (imputed)		1,380			1,692
Goodwill and intangible asset impairment		2,246			-
Stock compensation expense		527			533
Deferred income taxes		(362	)		186
Loss on disposal of assets		289			15
Allowance for doubtful accounts		9			124
Changes in assets and liabilities:
Receivables		3,133			1,216
Inventories		498			339
Accounts payable		(1,252	)		(783	)
Accrued liabilities and expenses		324			(1,593	)
Deferred revenue		(626	)		(462	)
Other assets and liabilities		(415	)		(2,200	)
Net cash provided by operating activities		3,192			628

Cash Flows from Investing Activities
Purchases of short-term investments		(1,486	)		(2,199	)
Sales of short-term investments		2,624			2,431
Capital expenditures		(440	)		(809	)
Capital expenditures - intangibles		(202	)		(311	)
Net cash provided by (used for) investing activities		496			(888	)

Cash Flows from Financing Activities
Proceeds from lines of credit		2,500			-
Payments on short-term borrowings		-			(155	)
Proceeds from stock plans		15			329
Cash payment for shares surrendered upon vesting of RSU's to cover taxes		(28	)		(55	)
Net cash provided by financing activities		2,487			119

Effect of Exchange Rate Changes on Cash and Cash Equivalents		(131	)		(150	)

Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash		6,044			(291	)
Cash, Cash Equivalents and Restricted Cash, July 1		4,843			5,996
Cash, Cash Equivalents and Restricted Cash, March 31	$	10,887		$	5,705

Supplemental Disclosure of Cash Flow Information
Cash paid during the period for interest	$	44		$	73
Cash paid during the period for income taxes	$	247		$	553

	March 31, 2020			March 31, 2019
Cash and Cash Equivalents	$	10,564		$	5,429
Restricted Cash included in Short-term Investments		323			276
Total Cash, Cash Equivalents and Restricted Cash	$	10,887		$	5,705

The notes to the consolidated financial statements are an integral part of these statements.

PERCEPTRON, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(UNAUDITED)

	Three Months Ended				Nine Months Ended
	March 31,				March 31,
(In Thousands)	2020		2019		2020		2019
Common Stock			(As Revised)				(As Revised)
Beginning balance	$	97	$	96	$	97	$	96
Issued		-		-		-		-
Ending balance		97		96		97		96

Accumulated Other Comprehensive Loss

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	2020-03-31	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	2020-09-01	Officers, Exhibits
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

EX-10.57	prcp-ex1057_164.htm
EX-31.1	prcp-ex311_167.htm
EX-31.2	prcp-ex312_165.htm
EX-32.1	prcp-ex321_166.htm

PRCP 10Q Quarterly Report

Perceptron Earnings 2020-03-31