Note 6 - Equity Method Investments

12 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Equity Method Investments and Joint Ventures Disclosure [Text Block]

6. EQUITY METHOD INVESTMENTS

On

January 16, 2018,

the Company purchased approximately

1,133,000

shares of Insignia at a price of

$1.25

per share for a total cost of approximately

$1,416,000,

which added to the

1,900,000

shares already owned at that date. After this purchase, the Company owned approximately

26%

of Insignia’s total common stock and the Company adopted the equity method of accounting. Subsequent to

January 16, 2018,

the Company purchased additional shares for a total cost of approximately

$385,000.

The Company adopted the equity method to account for this investment because of its ability to exercise significant influence, but

not

control, over the operating and financial policies of Insignia. Air T has elected a

three

-month lag upon adoption of the equity method and thus reported its investment in Insignia at cost as of

March 31, 2018.

At

March 31, 2018,

the Company held approximately

3.4

million shares of Insignia’s common stock representing approximately

28%

of the outstanding shares for a total net investment basis of

$4,599,000.

No

basis difference adjustments or allocation of earnings or loss from Insignia was recorded as of

March 31, 2018.

Previous Accumulated Other Comprehensive Income of

$722,000

was relieved into earnings as of the date equity method accounting was triggered,

January 16, 2018.

At

March 31, 2019,

the Company held approximately

3.5

million shares of Insignia’s common stock representing approximately

30%

of the outstanding shares for a total net investment basis of approximately

$5,162,000.

For the year ended

March 31, 2019,

the Company recorded approximately

$391,000

as its share of Insignia’s net income along with a basis difference adjustment of approximately

$92,000.

Summarized audited financial information for Insignia for the

twelve

months ended

December 31, 2018

and

December 31, 2017

are as follows:

	Twelve Months Ended		Twelve Months Ended
	December 31, 2018		December 31, 2017
Revenue	$	33,236,000	$	26,430,000
Gross Profit		12,561,000		8,401,000
Operating income (loss)		1,832,000		(908,000	)
Net income (loss)		1,399,000		(639,000	)
Net income attributable to Air T, Inc. stockholders	$	391,000	$	-