Equity Method Investments

6 Months Ended

Sep. 30, 2020

Equity Method Investments and Joint Ventures [Abstract]

The Company’s investment in Insignia Systems, Inc. (“Insignia”) is accounted for under the equity method of accounting. The Company has elected a three-month lag upon adoption of the equity method. As of September 30, 2020, the Company held approximately 3.5 million shares of Insignia’s common stock representing approximately 29% of the outstanding shares. The Company recorded approximately $0.5 million and $0.8 million as its share of Insignia’s net loss for the three and six months ended June 30, 2020 along with a basis difference adjustment of approximately $24.0 thousand and $48.0 thousand, respectively. The Company's net investment basis in Insignia is $0.5 million as of September 30, 2020.

On November 8, 2019, the Company made an investment of $2.8 million to purchase a 19.90% ownership stake in Cadillac Casting, Inc. ("CCI"), subsequently reduced to a 18.98% ownership stake as of September 30, 2020. The Company accounts for this investment under the equity method of accounting. Due to the differing fiscal year-ends, the Company has elected a three-month lag to record the CCI investment at cost, with a basis difference of $0.3 million. The Company recorded a loss of $30.4 thousand and $0.3 million as its share of CCI's net loss for the three and six months ended June 30, 2020, along with a basis difference adjustment of $12.5 thousand and $24.9 thousand, respectively. The Company's net investment basis in CCI is $2.9 million as of September 30, 2020.

Summarized unaudited financial information for the Company's equity method investees for the three and six months ended June 30, 2020 and 2019 is as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30, 2020		June 30, 2019		June 30, 2020		June 30, 2019
Revenue	$	12,138	$	29,885	$	34,074	$	60,222
Gross Profit	1,161		2,558		1,966		3,617
Operating loss	(1,814)		(1,045)		(4,192)		(3,371)
Net loss	(1,925)		(1,122)		(4,211)		(3,971)
Net loss attributable to Air T, Inc. stockholders	$	(542)	$	(166)	$	(1,112)	$	(488)