x | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended June 30, 2019 |
☐ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from _____to _____ |
Delaware | 52-1206400 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer ☐ | Accelerated filer ☐ |
Non-accelerated filer x | Smaller reporting company x |
Emerging growth company ☐ |
Common Stock | Common Shares, par value of $.25 per share |
Outstanding Shares at August 2, 2019 | 3,030,173 |
Page | ||
Risk Factors | ||
Exhibit Index | ||
Certifications | ||
Interactive Data Files | ||
Item 1. | Financial Statements |
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
Operating Revenues: | |||||||
Overnight air cargo | $ | 18,319,682 | $ | 17,640,658 | |||
Ground equipment sales | 12,248,891 | 6,384,781 | |||||
Ground support services | 8,516,800 | 9,047,640 | |||||
Printing equipment and maintenance | 64,270 | 298,823 | |||||
Commercial jet engines and parts | 16,326,905 | 27,320,175 | |||||
Corporate and other | 227,987 | 175,392 | |||||
55,704,535 | 60,867,469 | ||||||
Operating Expenses: | |||||||
Overnight air cargo | 16,518,823 | 15,174,396 | |||||
Ground equipment sales | 9,730,856 | 4,937,312 | |||||
Ground support services | 6,963,662 | 7,805,209 | |||||
Printing equipment and maintenance | 39,047 | 145,528 | |||||
Commercial jet engines and parts | 8,285,769 | 20,121,118 | |||||
General and administrative | 10,919,320 | 8,584,803 | |||||
Depreciation and amortization | 2,026,600 | 1,485,055 | |||||
Impairment | 6,686 | 10,346 | |||||
Loss on sale of property and equipment | 2,073 | — | |||||
54,492,836 | 58,263,767 | ||||||
Operating Income | 1,211,699 | 2,603,702 | |||||
Non-operating Income (Expense): | |||||||
Gain on sale of marketable securities | 36,460 | — | |||||
Foreign currency gain (loss), net | 35,755 | (2,182 | ) | ||||
Other-than-temporary impairment loss on investments | (814,558 | ) | — | ||||
Other investment income (loss), net | 162,957 | (315,507 | ) | ||||
Interest expense | (1,023,622 | ) | (707,199 | ) | |||
Unrealized gain on interest rate swap | — | 97,337 | |||||
Gain on settlement of bankruptcy | 4,509,302 | — | |||||
Bargain purchase acquisition gain | 34,244 | 1,983,777 | |||||
Income (loss) from equity method investments | (320,578 | ) | 9,183 | ||||
2,619,960 | 1,065,409 | ||||||
Income Before Income Taxes | 3,831,659 | 3,669,111 | |||||
Income Tax Expense (Benefit) | (324,000 | ) | 387,000 | ||||
Net Income | 4,155,659 | 3,282,111 | |||||
Net (Income) Attributable to Non-controlling | |||||||
Interests | $ | (2,373,307 | ) | $ | (453,417 | ) | |
Net Income Attributable to Air T, Inc. Stockholders | $ | 1,782,352 | $ | 2,828,694 | |||
Income Per Share: | |||||||
Basic | $ | 0.79 | $ | 0.92 | |||
Diluted | $ | 0.79 | $ | 0.92 | |||
Weighted Average Shares Outstanding: | |||||||
Basic | 2,252,698 | 3,065,411 | |||||
Diluted | 2,256,868 | 3,074,547 |
Three Months Ended June 30, 2019 | |||||||
2019 | 2018 | ||||||
Net income | $ | 4,155,659 | $ | 3,282,111 | |||
Other comprehensive income (loss): | |||||||
Foreign currency translation gain (loss) | (18,130 | ) | 47,660 | ||||
Unrealized loss on interest rate swaps, net of tax of $52,316 and $0 respectively | (176,038 | ) | — | ||||
Total Other Comprehensive Income (Loss) | (194,168 | ) | 47,660 | ||||
Total Comprehensive Income | 3,961,491 | 3,329,771 | |||||
Comprehensive Income Attributable to Non-controlling Interests | (2,385,532 | ) | (470,569 | ) | |||
Comprehensive Income Attributable to Air T, Inc. Stockholders | $ | 1,575,959 | $ | 2,859,202 |
June 30, 2019 | March 31, 2019 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current Assets: | |||||||
Cash and cash equivalents (Delphax $9,430 and $12,315)* | $ | 16,196,626 | $ | 12,524,321 | |||
Marketable securities | 1,752,727 | 1,760,052 | |||||
Restricted cash | 68,979 | 123,409 | |||||
Restricted investments | 796,958 | 830,925 | |||||
Accounts receivable, net of allowance for doubtful accounts of $574,086 and $754,108 (Delphax $291,337 and $294,296)* | 23,723,077 | 19,077,248 | |||||
Notes and other receivables-current | 7,170,143 | 5,026,549 | |||||
Income tax receivable | 883,131 | 158,446 | |||||
Inventories, net | 36,528,777 | 29,967,037 | |||||
Prepaid expenses and other (Delphax $9,672 and $58,164)* | 1,795,614 | 1,880,126 | |||||
Total Current Assets | 88,916,032 | 71,348,113 | |||||
Assets on lease, net of accumulated depreciation of $6,397,157 and $6,688,630 | 17,982,582 | 25,164,497 | |||||
Property and equipment, net of accumulated depreciation of $5,977,699 and $5,665,498 | 4,752,051 | 4,817,912 | |||||
Right-of-use assets | 10,071,405 | — | |||||
Cash surrender value of life insurance policies, net of policy loans | 101,259 | 122,062 | |||||
Other tax receivables-long-term (Delphax $0 and $311,000)* | — | 311,000 | |||||
Deferred income taxes | 600,303 | 547,987 | |||||
Investments in funds | 318,020 | 463,892 | |||||
Investments in securities | 557,329 | 621,610 | |||||
Equity method investments | 4,475,738 | 5,610,874 | |||||
Other assets | 297,507 | 491,328 | |||||
Intangible assets, net of accumulated amortization of $2,207,571 and $2,156,192 | 1,161,111 | 1,225,257 | |||||
Goodwill | 4,417,605 | 4,417,605 | |||||
Total Assets | $ | 133,650,942 | $ | 115,142,137 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current Liabilities: | |||||||
Accounts payable (Delphax $96,109 and $2,134,053)* | $ | 13,296,498 | $ | 12,552,724 | |||
Income tax payable | 550,727 | 661,690 | |||||
Accrued payroll and related items (Delphax $401,275 and $3,146,395 )* | 2,729,056 | 8,910,245 | |||||
Customer deposits | 2,794,277 | 1,520,000 | |||||
Accrued insurance liability | 1,254,396 | 1,119,853 | |||||
Other accrued expenses (Delphax $0 and $11,312)* | 3,905,819 | 2,953,176 | |||||
Deferred income | 5,599,423 | 341,098 | |||||
Current portion of long-term debt | 27,774,151 | 24,735,224 | |||||
Short-term lease liability | 2,486,842 | — | |||||
Total Current Liabilities | 60,391,189 | 52,794,010 | |||||
Long-term debt | 36,285,910 | 32,917,765 | |||||
Long-term lease liability | 8,071,541 | — | |||||
Other non-current liabilities | 1,229,495 | 596,598 | |||||
Total Liabilities | 105,978,135 | 86,308,373 | |||||
Redeemable non-controlling interest | 6,685,000 | 5,476,000 | |||||
Commitments and contingencies (Note 17) | |||||||
Equity: | |||||||
Air T, Inc. Stockholders' Equity: | |||||||
Preferred stock, $1.00 par value, 50,000 shares authorized | — | — | |||||
Common stock, $.25 par value; 4,000,000 shares authorized, 3,015,087 and 2,022,637 shares issued and outstanding | 753,770 | 505,657 | |||||
Additional paid-in capital | 1,629,202 | 2,866,695 | |||||
Retained earnings | 17,970,387 | 21,191,126 | |||||
Accumulated other comprehensive loss | (411,479 | ) | (205,086 | ) | |||
Total Air T, Inc. Stockholders' Equity | 19,941,880 | 24,358,392 | |||||
Non-controlling Interests | 1,045,927 | (1,000,628 | ) | ||||
Total Equity | 20,987,807 | 23,357,764 | |||||
Total Liabilities and Equity | $ | 133,650,942 | $ | 115,142,137 |
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income | $ | 4,155,659 | $ | 3,282,111 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
(Gain) Loss on sale of marketable securities | (36,460 | ) | 10,828 | ||||
Loss on sale of property and equipment | 2,073 | 1,661 | |||||
Change in inventory reserves | (4,087 | ) | 91,547 | ||||
Change in accounts receivable reserves | (180,022 | ) | (45,628 | ) | |||
Depreciation and amortization | 2,033,286 | 1,495,401 | |||||
Amortization of debt issuance costs | 73,467 | — | |||||
Impairment of investment | 814,558 | — | |||||
Change in cash surrender value of life insurance | 20,803 | (15,782 | ) | ||||
Gain on settlement of bankruptcy | (4,509,302 | ) | — | ||||
Gain on bargain purchase | (34,244 | ) | (1,983,777 | ) | |||
Change in warranty reserve | 335,632 | (980 | ) | ||||
Unrealized loss on marketable securities | 6,105 | 322,477 | |||||
Unrealized gain on interest rate swap | — | (97,337 | ) | ||||
Change in operating assets and liabilities: | |||||||
Accounts receivable | (4,254,064 | ) | 29,564 | ||||
Notes receivable and other non-trade receivables | (2,046,291 | ) | (2,221,930 | ) | |||
Inventories | 2,374,836 | 11,319,597 | |||||
Prepaid expense and other assets | 677,015 | 288,286 | |||||
Accounts payable | 2,801,237 | 3,942,185 | |||||
Accrued expenses | 3,898,519 | (1,982,397 | ) | ||||
Income taxes payable/receivable | (835,646 | ) | 205,583 | ||||
Non-current liabilities | 94,482 | 75,525 | |||||
Total adjustments | 1,231,897 | 11,434,823 | |||||
Net cash provided by operating activities | 5,387,556 | 14,716,934 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchases of marketable securities | (27,211 | ) | (784,443 | ) | |||
Proceeds from sale of marketable securities | 309,012 | — | |||||
Acquisition of businesses, net of cash acquired | (500,000 | ) | (3,325,700 | ) | |||
Cash used for equity method investments | — | (197,532 | ) | ||||
Investment in reinsurance entity | — | (2,000,000 | ) | ||||
Capital expenditures related to property & equipment | (297,967 | ) | (459,575 | ) | |||
Capital expenditures related to assets on lease | (3,298,343 | ) | — | ||||
Proceeds from sale of property and equipment | 33,995 | 50,602 | |||||
Net cash used in investing activities | (3,780,514 | ) | (6,716,648 | ) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Proceeds from lines of credit | 24,446,825 | 28,933,742 | |||||
Payments on lines of credit | (17,143,130 | ) | (38,156,091 | ) | |||
Proceeds from term loan | — | 3,400,000 | |||||
Payments on term loan | (7,026,081 | ) | (1,404,800 | ) | |||
Debt issuance costs | (46,319 | ) | (35,702 | ) | |||
Distribution to non-controlling member | (115,000 | ) | (47,051 | ) | |||
Payments for repurchase of stock | (126,317 | ) | — | ||||
Proceeds from exercise of warrants | 2,018,217 | — | |||||
Net cash provided by financing activities | 2,008,195 | (7,309,902 | ) | ||||
Effect of foreign currency exchange rates on cash and cash equivalents | 2,638 | 2,072 | |||||
NET INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 3,617,875 | 692,456 | |||||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD | 12,647,730 | 5,072,897 | |||||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD | $ | 16,265,605 | $ | 5,765,353 | |||
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||
Non-cash capital expenditures related to property & equipment | $ | 71,703 | $ | — | |||
Equipment leased to customers transferred to inventory | 8,818,109 | 234,151 | |||||
Issuance of Debt - Trust Preferred Securities | 4,000,000 | — | |||||
Issuance of warrant liability | 840,000 | — | |||||
Exercise of warrants | (84,092 | ) | — | ||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||
Cash paid during the year for: | |||||||
Interest | 678,610 | 629,264 | |||||
Income taxes | 29,634 | 181,417 |
Equity | ||||||||||||||||||||||||||
Air T, Inc. Stockholders' Equity | ||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) | Non-controlling Interests | Total Equity | |||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||
Balance, March 31, 2018 | 2,043,607 | $ | 510,901 | $ | 4,171,869 | $ | 20,695,981 | $ | (260,900 | ) | $ | (874,767 | ) | $ | 24,243,084 | |||||||||||
Net income* | — | — | — | 2,828,694 | — | (46,259 | ) | 2,782,435 | ||||||||||||||||||
Reclassification of unrealized loss on marketable securities, net of tax | — | — | — | (106,341 | ) | 106,341 | — | — | ||||||||||||||||||
Foreign currency translation gain | — | — | — | — | 30,508 | 17,152 | 47,660 | |||||||||||||||||||
Balance, June 30, 2018 | 2,043,607 | $ | 510,901 | $ | 4,171,869 | $ | 23,418,334 | $ | (124,051 | ) | $ | (903,874 | ) | $ | 27,073,179 | |||||||||||
Equity | ||||||||||||||||||||||||||
Air T, Inc. Stockholders' Equity | ||||||||||||||||||||||||||
Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Non-controlling Interests | Total Equity | |||||||||||||||||||||
Shares | Amount | |||||||||||||||||||||||||
Balance, March 31, 2019 | 2,022,637 | $ | 505,657 | $ | 2,866,695 | $ | 21,191,126 | $ | (205,086 | ) | $ | (1,000,628 | ) | $ | 23,357,764 | |||||||||||
Net income* | — | — | — | 1,782,352 | — | 2,034,330 | 3,816,682 | |||||||||||||||||||
Repurchase of Common Stock | (17,424 | ) | (4,356 | ) | — | (121,961 | ) | — | — | (126,317 | ) | |||||||||||||||
Stock Split | 1,009,874 | 252,469 | (252,469 | ) | — | — | — | — | ||||||||||||||||||
Issuance of Debt - Trust Preferred Securities | — | — | — | (4,000,000 | ) | — | — | (4,000,000 | ) | |||||||||||||||||
Issuance of Warrants | (840,000 | ) | (840,000 | ) | ||||||||||||||||||||||
Adoption of ASC 842 - Leasing | — | — | — | (41,130 | ) | — | — | (41,130 | ) | |||||||||||||||||
Unrealized loss on interest rate swaps, net of tax | — | — | — | — | (176,038 | ) | — | (176,038 | ) | |||||||||||||||||
Foreign currency translation gain (loss) | — | — | — | — | (30,355 | ) | 12,225 | (18,130 | ) | |||||||||||||||||
Adjustment to fair value of redeemable non-controlling interest | — | — | (985,024 | ) | — | — | — | (985,024 | ) | |||||||||||||||||
Balance, June 30, 2019 | 3,015,087 | $ | 753,770 | $ | 1,629,202 | $ | 17,970,387 | $ | (411,479 | ) | $ | 1,045,927 | $ | 20,987,807 |
1. | Financial Statement Presentation |
2. | Revenue Recognition |
Type of Revenue | Nature, Timing of Satisfaction of Performance Obligations, and Significant Payment Terms |
Product Sales | The Company generates revenue from sales of various distinct products such as parts, aircraft equipment, printing equipment, jet engines, airframes, and scrap metal to its customers. A performance obligation is created when the Company accepts an order from a customer to provide a specified product. Each product ordered by a customer represents a performance obligation. The Company recognizes revenue when obligations under the terms of the contract are satisfied; generally, this occurs at a point-in-time upon shipment or when control is transferred to the customer. Transaction prices are based on contracted terms, which are at fixed amounts based on standalone selling prices. While the majority of the Company's contracts do not have variable consideration, for the limited number of contracts that do, the Company records revenue based on the standalone selling price less an estimate of variable consideration (such as rebates, discounts or prompt payment discounts). The Company estimates these amounts based on the expected incentive amount to be provided to customers and reduces revenue accordingly. Performance obligations are short-term in nature and customers are typically billed upon transfer of control. The Company records all shipping and handling fees billed to customers as revenue. The terms and conditions of the customer purchase orders or contracts are dictated by either the Company’s standard terms and conditions or by a master service agreement or by the contract. |
Support Services | The Company provides a variety of support services such as aircraft maintenance, printer maintenance, and short-term repair services to its customers. Additionally, the Company operates certain aircraft routes on behalf of FedEx. A performance obligation is created when the Company agrees to provide a particular service to a customer. For each service, the Company recognizes revenues over time as the customer simultaneously receives the benefits provided by the Company's performance. This revenue recognition can vary from when the Company has a right to invoice to the output or input method depending on the structure of the contract and management’s analysis. For repair-type services, the Company records revenue over-time based on an input method of costs incurred to total estimated costs. The Company believes this is appropriate as the Company is enhancing an asset that the customer controls as repair work, such as labor hours are incurred, and parts installed, is being performed. The vast majority of repair-services are short term in nature and are typically billed upon completion of the service. Some of the Company’s contracts contain a promise to stand ready as the Company is obligated to perform certain maintenance or administrative services. For most of these contracts, the Company applies the 'as invoiced' practical expedient as the Company has a right to consideration from the customer in an amount that corresponds directly with the value of the entity's performance completed to date. A small number of contracts are accounted for as a series and recognized equal to the amount of consideration the Company is entitled to less an estimate of variable consideration (typically rebates). These services are typically ongoing and are generally billed on a monthly basis. |
Three Months Ended June 30, 2019 | Three Months Ended June 30, 2018 | ||||||
Product Sales | |||||||
Air cargo | $ | 5,414,377 | $ | 5,519,611 | |||
Ground equipment sales | 12,002,366 | 6,169,103 | |||||
Ground support services | 2,266,859 | 2,422,581 | |||||
Commercial jet engines and parts | 11,170,632 | 25,029,114 | |||||
Printing equipment and maintenance | 48,440 | 286,642 | |||||
Corporate and other | — | — | |||||
Support Services | |||||||
Air cargo | 12,894,182 | 12,096,874 | |||||
Ground equipment sales | 104,545 | 100,592 | |||||
Ground support services | 6,213,354 | 6,605,265 | |||||
Commercial jet engines and parts | 1,410,027 | 965,826 | |||||
Printing equipment and maintenance | 10,745 | 7,658 | |||||
Corporate and other | 40,552 | — | |||||
Leasing Revenue | |||||||
Air cargo | — | — | |||||
Ground equipment sales | 20,357 | 31,002 | |||||
Ground support services | — | — | |||||
Commercial jet engines and parts | 3,714,048 | 1,201,510 | |||||
Printing equipment and maintenance | — | — | |||||
Corporate and other | 45,418 | 40,067 | |||||
Other | |||||||
Air cargo | 11,123 | 24,174 | |||||
Ground equipment sales | 121,623 | 84,084 | |||||
Ground support services | 36,588 | 19,795 | |||||
Commercial jet engines and parts | 32,197 | 123,724 | |||||
Printing equipment and maintenance | 5,085 | 4,523 | |||||
Corporate and other | 142,017 | 135,324 | |||||
Total | $ | 55,704,535 | $ | 60,867,469 |
Three Months Ended June 30, 2019 | Three Months Ended June 30, 2018 | ||||||
Air cargo | $ | 18,319,682 | $ | 17,640,658 | |||
Ground equipment sales | 12,248,891 | 6,384,781 | |||||
Ground support services | 8,516,800 | 9,047,640 | |||||
Commercial jet engines and parts | 16,326,905 | 27,320,175 | |||||
Printing equipment and maintenance | 64,270 | 298,823 | |||||
Corporate and other | 227,987 | 175,392 | |||||
Total | $ | 55,704,535 | $ | 60,867,469 |
Outstanding contract liabilities | Outstanding contract liabilities as of April 1, 2019 Recognized as Revenue | |||||||
As of June 30, 2019 | $ | 8,393,700 | ||||||
As of April 1, 2019 | $ | 1,866,843 | ||||||
For the quarter ended June 30, 2019 | $ | 447,341 |
Contract assets | |||
As of June 30, 2019 | $ | 4,621,096 | |
As of April 1, 2019 | $ | 1,743,460 |
3. | Business Combinations |
Earnest money | $ | 50,000 | |
Cash consideration | 3,300,000 | ||
Cash acquired | (24,301 | ) | |
Total consideration | $ | 3,325,699 |
May 4, 2018 | |||
ASSETS | |||
Accounts receivable | $ | 1,929,120 | |
Inventories | 4,564,437 | ||
Other current assets | 149,792 | ||
Property and equipment | 391,892 | ||
Other assets | 189,607 | ||
Intangible assets - tradename | 138,000 | ||
Total assets | 7,362,848 | ||
LIABILITIES | |||
Accounts payable | 1,289,150 | ||
Accrued expenses | 175,222 | ||
Deferred tax liability | 589,000 | ||
Total liabilities | 2,053,372 | ||
Net assets acquired | $ | 5,309,476 | |
Consideration paid | $ | 3,350,000 | |
Less: Cash acquired | (24,301 | ) | |
Bargain purchase gain | $ | 1,983,777 |
4. | Restricted Cash |
June 30, 2019 | March 31, 2019 | ||||||
Cash and cash equivalents | $ | 16,196,626 | $ | 12,524,321 | |||
Restricted cash | 68,979 | 123,409 | |||||
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ | 16,265,605 | $ | 12,647,730 |
5. | Cash Surrender Value of Life Insurance |
7. | Net Earnings Per Share |
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
Net Income Attributable to Air T, Inc. Stockholders | $ | 1,782,352 | $ | 2,828,694 | |||
Income Per Share: | |||||||
Basic | $ | 0.79 | $ | 0.92 | |||
Diluted | $ | 0.79 | $ | 0.92 | |||
Weighted Average Shares Outstanding: | |||||||
Basic | 2,252,698 | 3,065,411 | |||||
Diluted | 2,256,868 | 3,074,547 |
Fiscal year ended | ||||||||
2019 | 2018 | |||||||
Net Income Attributable to Air T, Inc. Shareholders | 1,339,995 | 2,277,109 | ||||||
Weighted-average common shares outstanding | ||||||||
Basic | 3,052,124 | 3,064,209 | ||||||
Diluted | 3,059,838 | 3,071,528 | ||||||
Basic earnings per common share | $ | 0.44 | $ | 0.74 | ||||
Diluted earnings per common share | $ | 0.44 | $ | 0.74 |
8. | Investments in Securities |
9. | Equity Method Investments |
Three Months Ended March 31, 2019 | Three Months Ended March 31, 2018 | ||||||
Revenue | $ | 5,140,000 | $ | 7,419,000 | |||
Gross Profit | 774,000 | 2,746,000 | |||||
Operating income (loss) | (1,337,000 | ) | 232,000 | ||||
Net income (loss) | (1,096,000 | ) | 164,000 | ||||
Net income (loss) attributable to Air T, Inc. stockholders | $ | (322,000 | ) | $ | 5,000 |
10. | Inventories |
June 30, 2019 | March 31, 2019 | ||||||
Ground support service parts | $ | 2,580,196 | $ | 2,553,949 | |||
Ground equipment manufacturing: | |||||||
Raw materials | 3,017,469 | 2,497,876 | |||||
Work in process | 1,351,370 | 1,659,516 | |||||
Finished goods | 643,763 | 972,542 | |||||
Printing equipment and maintenance | |||||||
Raw materials | — | 401,103 | |||||
Finished goods | 1,438,161 | 1,047,893 | |||||
Commercial jet engines and parts | 27,691,133 | 21,031,558 | |||||
Total inventories | $ | 36,722,092 | $ | 30,164,437 | |||
Reserves | (193,315 | ) | (197,400 | ) | |||
Total inventories, net of reserves | $ | 36,528,777 | $ | 29,967,037 |
11. | Leases |
Three Months Ended June 30, 2019 | ||||
Operating lease cost | $ | 819,854 | ||
Short-term lease cost | 274,156 | |||
Variable lease cost | 135,613 | |||
Sublease income | — | |||
Total lease cost | $ | 1,229,623 |
June 30, 2019 | ||||
Operating leases | ||||
Operating lease right-of-use assets | $ | 10,071,405 | ||
Operating lease liabilities | 10,558,383 | |||
Weighted-average remaining lease term | 12.08 years | |||
Operating leases | ||||
Weighted-average discount rate | 4.51 | % | ||
Operating leases |
Operating Leases | ||
2020 (excluding the three months ended June 30, 2019) | (2,267,538 | ) |
2021 | (2,122,870 | ) |
2022 | (1,621,902 | ) |
2023 | (1,268,783 | ) |
2024 | (691,886 | ) |
2025 | (457,798 | ) |
Thereafter | (5,809,603 | ) |
Total undiscounted lease payments | (14,240,380 | ) |
Less: Interest | (3,023,181 | ) |
Less: Discount | (658,816 | ) |
Total lease liabilities | (10,558,383 | ) |
Year ended March 31, | ||
2020 | 3,133,000 | |
2021 | 2,115,000 | |
2022 | 1,625,000 | |
2023 | 1,241,000 | |
2024 | 692,000 | |
Thereafter | 6,267,000 | |
Total minimum lease payments | 15,073,000 |
June 30, 2019 | March 31, 2019 | Maturity Date | Interest Rate | Unused commitments | |||||||||
Revolver - MB&T | $ | 14,830,650 | $ | 12,403,213 | November 30, 2019 | Prime - 1% | $2,169,351 | ||||||
Term Note A - MB&T | 8,500,000 | 8,750,000 | January 1, 2028 | 1-month LIBOR + 2% | |||||||||
Term Note B - MB&T | 4,250,000 | 4,375,000 | January 1, 2028 | 4.5% | |||||||||
Term Note D - MB&T | 1,590,400 | 1,607,200 | January 1, 2028 | 1-month LIBOR + 2% | |||||||||
Debt - Trust Preferred Securities | 6,102,310 | — | June 7, 2049 | 8% | |||||||||
Air T Debt | 35,273,360 | 27,135,413 | |||||||||||
Revolver - MB&T | — | 3,820,000 | May 21, 2019 | 7.5% | 5,000,000 | ||||||||
Revolver - MB&T | 4,876,259 | — | November 30, 2019 | greater of 6.50% or Prime + 2% | 5,123,741 | ||||||||
Term Loan - MB&T | — | 450,000 | December 17, 2019 | 7.50% | |||||||||
Term Loan - MB&T | — | 400,000 | June 17, 2020 | 7.25% | |||||||||
Term Loan - Park State | 2,100,000 | 2,100,000 | June 17, 2020 | 8.50% | |||||||||
AirCo Debt | 6,976,259 | 6,770,000 | |||||||||||
Revolver | — | — | May 5, 2019 | 1-month LIBOR + 3% | — | ||||||||
Term Loan | 8,152,054 | 8,616,336 | January 26, 2021 | 1-month LIBOR + 3.75% | |||||||||
Term Loan | 14,000,000 | 15,500,000 | September 14, 2021 | 1-month LIBOR + 3.75% | |||||||||
Contrail Debt - Old National | 22,152,054 | 24,116,336 | |||||||||||
Total Debt | 64,401,673 | 58,021,749 | |||||||||||
Less: Unamortized Debt Issuance Costs | (341,612 | ) | (368,760 | ) | |||||||||
Total Debt, net | $ | 64,060,061 | $ | 57,652,989 |
Due by | Amount | |||
June 30, 2020 | $ | 27,774,151 | ||
June 30, 2021 | 17,319,212 | |||
June 30, 2022 | 3,567,200 | |||
June 30, 2023 | 1,567,200 | |||
June 30, 2024 | 1,567,200 | |||
Thereafter | 12,606,710 | |||
64,401,673 | ||||
Less: Unamortized Debt Issuance Costs | (341,612 | ) | ||
$ | 64,060,061 |
• | A dividend of one additional share for every two shares already held (a 50% stock dividend, or the equivalent of a 3-for-2 stock split). See Footnote 7 for discussion. |
• | The Company issued and distributed to existing common shareholders an aggregate of 1,600,000 trust preferred capital security ("TruPs") shares (aggregate $4,000,000 stated value) and an aggregate of 8,400,000 warrants ("Warrants") (representing warrants to purchase $21,000,000 in stated value of TruPs). The Warrants are exercisable for one year from issuance. |
• | The Company entered into an 8% Junior Subordinated Debenture (“Debenture”) to pay to Air T Funding ("the Trust") a principal sum of $4,000,000 on June 7, 2049, and to pay interest on said principal sum quarterly at the rate of 8.0% per annum. The Company's Debenture and the Trust's associated note receivable (the "Note") are eliminated in the Company's consolidated financial statements, and Debt - Trust Preferred Securities is presented as a component of long-term debt on our consolidated balance sheets. |
Fair Value Measurement as of June 30, 2019 | |||
Warrant liability (Level 2) | $ | 755,907 |
13. | Variable Interest Entities |
• | the power to direct the activities that most significantly impact the economic performance of the VIE; and |
• | the right to receive benefits from, or the obligation to absorb losses of, the VIE that could be potentially significant to the VIE. |
June 30, 2019 | March 31, 2019 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 9,430 | $ | 12,315 | |||
Accounts receivable, net | 49,844 | 46,844 | |||||
Other current assets | 9,672 | 58,441 | |||||
Total current assets | 68,946 | 117,600 | |||||
Other tax receivables-long-term | 311,000 | ||||||
Total assets | $ | 68,946 | $ | 428,600 | |||
LIABILITIES | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 96,109 | $ | 2,151,235 | |||
Accrued expenses | 401,275 | 3,157,707 | |||||
Short-term debt | — | 1,749,779 | |||||
Total current liabilities | 497,384 | 7,058,721 | |||||
Total liabilities | $ | 497,384 | $ | 7,058,721 | |||
Net Liabilities | $ | (428,438 | ) | $ | (6,630,121 | ) |
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
Operating Revenues | $ | — | $ | — | |||
Operating Expenses: | |||||||
Cost of sales | — | — | |||||
General and administrative | 72,748 | 52,260 | |||||
72,748 | 52,260 | ||||||
Operating Loss | (72,748 | ) | (52,260 | ) | |||
Non-operating Income (Expenses), net | 6,237,385 | (87,917 | ) | ||||
Income (Loss) Before Income Taxes | 6,164,637 | (140,177 | ) | ||||
Income Taxes | — | — | |||||
Net Income (Loss) | $ | 6,164,637 | $ | (140,177 | ) |
14. | Share Repurchase |
15. | Geographical information |
June 30, 2019 | March 31, 2019 | ||||||
United States | $ | 4,865,948 | $ | 4,946,997 | |||
Foreign | 17,868,685 | 25,035,412 | |||||
Total property and equipment, net | $ | 22,734,633 | $ | 29,982,409 |
June 30, 2019 | March 31, 2019 | ||||||
Australia | $ | 3,594 | $ | 5,186 | |||
Mexico | 2,262,967 | 2,680,825 | |||||
Netherlands | 5,350,275 | 5,541,072 | |||||
China | 10,251,849 | 16,808,329 | |||||
Total property and equipment, net | $ | 17,868,685 | $ | 25,035,412 |
June 30, 2019 | June 30, 2018 | ||||||
United States | $ | 46,127,349 | $ | 54,662,311 | |||
Foreign | 9,577,186 | 6,205,158 | |||||
Total revenue | $ | 55,704,535 | $ | 60,867,469 |
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
Operating Revenues by Segment: | |||||||
Overnight Air Cargo | $ | 18,319,682 | $ | 17,640,658 | |||
Ground Equipment Sales: | |||||||
Domestic | 10,858,891 | 5,292,017 | |||||
International | 1,390,000 | 1,095,097 | |||||
Total Ground Equipment Sales | 12,248,891 | 6,387,114 | |||||
Ground Support Services | 8,516,800 | 9,047,640 | |||||
Printing Equipment and Maintenance | |||||||
Domestic | 21,684 | 194,792 | |||||
International | 46,186 | 107,921 | |||||
Total Printing Equipment and Maintenance | 67,870 | 302,713 | |||||
Commercial Jet Engines and Parts: | |||||||
Domestic | 8,938,715 | 23,154,535 | |||||
International | 8,141,000 | 5,002,140 | |||||
Total Commercial Jet Engines and Parts | 17,079,715 | 28,156,675 | |||||
Corporate and other | 598,988 | 474,205 | |||||
Intercompany | (1,127,411 | ) | (1,141,536 | ) | |||
Total | $ | 55,704,535 | $ | 60,867,469 | |||
Operating Income (Loss): | |||||||
Overnight Air Cargo | $ | 47,918 | $ | 1,056,692 | |||
Ground Equipment Sales | 1,347,378 | 393,500 | |||||
Ground Support Services | 213,081 | (87,724 | ) | ||||
Printing Equipment and Maintenance | (456,199 | ) | (318,278 | ) | |||
Commercial Jet Engines and Parts | 1,909,029 | 3,282,908 | |||||
Corporate and other | (1,869,296 | ) | (1,729,200 | ) | |||
Intercompany | 19,788 | 5,804 | |||||
Total | $ | 1,211,699 | $ | 2,603,702 | |||
Capital Expenditures: | |||||||
Overnight Air Cargo | $ | 8,288 | $ | 5,996 | |||
Ground Equipment Sales | 10,402 | 140,090 | |||||
Ground Support Services | 47,608 | 52,438 | |||||
Printing Equipment and Maintenance | — | — | |||||
Commercial Jet Engines and Parts | 3,465,404 | 183,821 | |||||
Corporate and other | 60,224 | 77,230 | |||||
Total | $ | 3,591,926 | $ | 459,575 | |||
Depreciation, Amortization and Impairment: | |||||||
Overnight Air Cargo | 18,176 | $ | 22,763 | ||||
Ground Equipment Sales | 52,380 | 91,349 | |||||
Ground Support Services | 86,252 | 125,055 | |||||
Printing Equipment and Maintenance | 2,225 | 14,331 | |||||
Commercial Jet Engines and Parts | 1,735,490 | 1,097,933 | |||||
Corporate and other | 140,088 | 145,295 | |||||
Intercompany | (1,325 | ) | (1,325 | ) | |||
Total | $ | 2,033,286 | $ | 1,495,401 |
17. | Commitments and Contingencies |
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations. |
• | Overnight air cargo, which operates in the air express delivery services industry; |
• | Ground equipment sales, which manufactures and provides mobile deicers and other specialized equipment products to passenger and cargo airlines, airports, the military and industrial customers; |
• | Ground support services, which provides ground support equipment maintenance and facilities maintenance services to domestic airlines and aviation service providers across the United States; |
• | Commercial aircraft, engines and parts, which manages and leases aviation assets; supplies surplus and aftermarket commercial jet engine components; provides commercial aircraft disassembly/part-out services; commercial aircraft parts sales; procurement services and overhaul and repair services to airlines; |
• | Printing equipment and maintenance, which designs, manufactures and sells advanced digital print production equipment and provides maintenance services to commercial customers; and commercial aircraft companies and, |
• | Corporate and other, which acts as the capital allocator and resource for other segments. |
Three Months Ended June 30, | Change | |||||||||||||
2019 | 2018 | |||||||||||||
Overnight Air Cargo | $ | 18,319,682 | $ | 17,640,658 | $ | 679,024 | 4 | % | ||||||
Ground Equipment Sales | 12,248,891 | 6,384,781 | 5,864,110 | 92 | % | |||||||||
Ground Support Services | 8,516,800 | 9,047,640 | (530,840 | ) | (6 | )% | ||||||||
Commercial Jet Engines and Parts | 16,326,905 | 27,320,175 | (10,993,270 | ) | (40 | )% | ||||||||
Printing Equipment and Maintenance | 64,270 | 298,823 | (234,553 | ) | (78 | )% | ||||||||
Corporate and other | 227,987 | 175,392 | 52,595 | 30 | % | |||||||||
$ | 55,704,535 | $ | 60,867,469 | $ | (5,162,934 | ) | (8 | )% |
Three Months Ended June 30, 2019 | Change | |||||||||||||
2019 | 2018 | |||||||||||||
Overnight Air Cargo | $ | 17,476 | $ | 1,056,692 | $ | (1,039,216 | ) | -98 | % | |||||
Ground Equipment Sales | 1,347,378 | 393,079 | $ | 954,299 | 243 | % | ||||||||
Ground Support Services | 213,081 | (87,303 | ) | $ | 300,384 | n/m | ||||||||
Commercial Jet Engines and Parts | 1,887,894 | 3,213,180 | $ | (1,325,286 | ) | -41 | % | |||||||
Printing Equipment and Maintenance | (382,183 | ) | (241,070 | ) | $ | (141,113 | ) | 59 | % | |||||
Corporate and other | (1,871,947 | ) | (1,730,876 | ) | $ | (141,071 | ) | 8 | % | |||||
$ | 1,211,699 | $ | 2,603,702 | $ | (1,392,003 | ) | (53 | )% |
Three Months Ended June 30, | Change | ||||||||||||
2019 | 2018 | ||||||||||||
Gain on sale of marketable securities | $ | 36,460 | $ | — | $ | 36,460 | 100 | % | |||||
Foreign currency gain (loss), net | 35,755 | (2,182 | ) | 37,937 | n/m | ||||||||
Other-than-temporary impairment loss on investments | (814,558 | ) | — | (814,558 | ) | (100 | )% | ||||||
Other investment income (loss), net | 162,957 | (315,507 | ) | 478,464 | n/m | ||||||||
Interest expense and other | (1,023,622 | ) | (707,199 | ) | (316,423 | ) | (45 | )% | |||||
Unrealized gain on interest rate swap | — | 97,337 | (97,337 | ) | (100 | )% | |||||||
Gain on settlement of bankruptcy | 4,509,302 | — | 4,509,302 | 100 | % | ||||||||
Bargain purchase acquisition gain | 34,244 | 1,983,777 | (1,949,533 | ) | (98 | )% | |||||||
Income (loss) from equity method investments | (320,578 | ) | 9,183 | (329,761 | ) | n/m | |||||||
$ | 2,619,960 | $ | 1,065,409 | $ | 1,554,551 | 146 | % | ||||||
Three Months Ended June 30, | |||||||
2019 | 2018 | ||||||
Net Cash Provided by Operating Activities | 5,387,556 | 14,716,934 | |||||
Net Cash Used in Investing Activities | (3,780,514 | ) | (6,716,648 | ) | |||
Net Cash Provided by/ (Used in) Financing Activities | 2,008,195 | (7,309,902 | ) | ||||
Effect of foreign currency exchange rates on cash and cash equivalents | 2,638 | 2,072 | |||||
Net Increase/ (Decrease) in Cash and Cash Equivalents and Restricted Cash | $ | 3,617,875 | $ | 692,456 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
Item 4. | Controls and Procedures |
(a) | None. |
(b) | None. |
(c) | On May 14, 2014, the Company announced that its Board of Directors had authorized a program to repurchase up to 750,000 shares of the Company’s common stock from time to time on the open market or in privately negotiated transactions, in compliance with SEC Rule 10b-18, over an indefinite period. |
Dates of Shares Purchased | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Public Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||||
April 1 - April 30, 2019 | 1,932 | $ | 28.73 | 24,584 | 725,416 | ||||||||
May 1 - May 30, 2019 | 913 | $ | 27.13 | 25,497 | 724,503 | ||||||||
June 1 - June 30, 2019 | 14,579 | $ | 16.50 | 40,076 | 709,924 |
No. | Description |
31.1 | |
31.2 | |
32.1 | |
101 | The following financial information from the Quarterly Report on Form 10-Q for the quarter ended June 30, 2019, formatted in XBRL (Extensible Business Reporting Language): (i) Condensed Consolidated Statements of Income, (ii) the Condensed Consolidated Balance Sheets, (iii) the Condensed Consolidated Statements of Cash Flows, (iv) the Condensed Consolidated Statements of Stockholders Equity, and (v) the Notes to the Condensed Consolidated Financial Statements. |
AIR T, INC. | ||
Date: August 14, 2019 | ||
/s/ Nick Swenson | ||
Nick Swenson, Chief Executive Officer and Director | ||
/s/ Brian Ochocki | ||
Brian Ochocki, Chief Financial Officer | ||
1. | I have reviewed this Form 10-Q of Air T, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: August 14, 2019 | |||
/s/ Nick Swenson | |||
Nick Swenson Chief Executive Officer |
1. | I have reviewed this Form 10-Q of Air T, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: August 14, 2019 | |||
/s/ Brian Ochocki | |||
Brian Ochocki Chief Financial Officer |
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. |
Date: August 14, 2019 | |||
/s/ Nick Swenson | |||
Nick Swenson, Chief Executive Officer | |||
(Principal Executive Officer) | |||
/s/ Brian Ochocki | |||
Brian Ochocki, Chief Financial Officer | |||
(Principal Financial Officer and Principal Accounting Officer) |
Document And Entity Information - shares |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Aug. 02, 2019 |
|
Document And Entity Information [Abstract] | ||
Entity Registrant Name | AIR T INC | |
Entity Central Index Key | 0000353184 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Common Stock, Shares Outstanding (in shares) | 3,030,173 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 4,155,659 | $ 3,282,111 |
Other comprehensive income (loss): | ||
Foreign currency translation gain (loss) | (18,130) | 47,660 |
Unrealized loss on interest rate swaps, net of tax of $52,316 and $0 respectively | (176,038) | 0 |
Total Other Comprehensive Income (Loss) | (194,168) | 47,660 |
Total Comprehensive Income | 3,961,491 | 3,329,771 |
Comprehensive Income Attributable to Non-controlling Interests | (2,385,532) | (470,569) |
Comprehensive Income Attributable to Air T, Inc. Stockholders | $ 1,575,959 | $ 2,859,202 |
Condensed Consolidated Statements of Comprehensive Income (Unaudited) (Parentheticals) |
3 Months Ended |
---|---|
Jun. 30, 2019
USD ($)
| |
Statement of Comprehensive Income [Abstract] | |
Unrealized loss on interest rate swaps, tax | $ 52,316 |
Financial Statement Presentation |
3 Months Ended |
---|---|
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Financial Statement Presentation | Financial Statement Presentation The condensed consolidated financial statements of Air T, Inc. (“Air T”, the “Company”, “we”, “us” or “our”) have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the following disclosures are adequate to make the information presented not misleading. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of the results for the periods presented have been made. It is suggested that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended March 31, 2019. The results of operations for the period ended June 30, 2019 are not necessarily indicative of the operating results for the full year. Certain reclassifications have been made to the prior period amounts to conform to the current presentation. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) as amended by multiple standards updates. The new standard provides that a lessee should recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term. For leases with a term of twelve months or less, the lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal year, with early adoption permitted. Topic 842 permits two transition methods: (1) a modified retrospective transition method requiring retrospective adjustment of each comparative presented with an adjusting entry at the beginning of the earliest comparative period presented and (2) a modified retrospective approach with no restatement of prior periods and an adjusting entry as of the effective date. Under both transition methods, entities may elect certain transition practical expedients that would be required to be applied to all leases. The Company adopted the standard in the fiscal year beginning April 1, 2019 using the modified retrospective transition method that does not require retrospective adjustment of the comparative periods. The Company reviewed existing leases to determine the impact of the adoption of the standard on its consolidated financial statements. Implementation had an immaterial cumulative effect on retained earnings. Adoption resulted in the recognition of right-of-use assets of approximately $10.7 million, and lease liabilities of approximately $11.2 million. Upon adoption, the Company elected practical expedients related to a) short term lease exemption b) not separate lease and non-lease components c) not reassess whether expired or existing contracts contain leases, d) not reassess lease classification for existing or expired leases and e) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This standard significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income, including trade receivables. The standard requires an entity to estimate its lifetime “expected credit loss” for such assets at inception, and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods therein. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU simplifies how an entity is required to test goodwill for impairment by eliminating Step Two from the goodwill impairment test. Step Two measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under this standard, an entity will recognize an impairment charge for the amount by which the carrying value of a reporting unit exceeds its fair value. The standard is effective for any interim goodwill impairment tests in fiscal years beginning after December 15, 2019 and is to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In August 2018, the FASB amended the Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement Topic of the Accounting Standards Codification. The amendment is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendment includes different transition requirements based on the disclosure topic. Changes to disclosure requirements for unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other required disclosure changes should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of this update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In August 2018, the FASB amended the Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract Topic of the Accounting Standards Codification. The amendment is effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other entities, the amendments in this update are effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021. Early adoption of the amendments in the update is permitted, including adoption in any interim period, for all entities. The amendments in the update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In October 2018, the FASB updated the Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities of the Accounting Standards Codification. The amendments in this update affect reporting entities that are required to determine whether they should consolidate a legal entity under the guidance within the Variable Interest Entities Subsections of Subtopic 810-10, Consolidation—Overall. Indirect interests held through related parties in common control arrangements should be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. The amendments in this update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. |
Revenue Recognition |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition Substantially all of the Company’s revenue is derived from contracts with an initial expected duration of one year or less, as a result, the Company has applied the practical expedient to exclude consideration of significant financing components from the determination of transaction price, to expense costs incurred to obtain a contract, and to not disclose the value of unsatisfied performance obligations. The following is a description of the Company’s performance obligations:
In addition to the above type of revenues, the Company also has Leasing Revenue, which is in scope under Topic 842 (Leases) and out of scope under Topic 606 and Other Revenues (Freight, Management Fees, etc.) which are immaterial for disclosure under Topic 606. The following table summarizes disaggregated revenues by type:
The following table summarizes total revenues by segment:
See Note 15 for the Company's disaggregated revenues by geographic region and Note 16 for the Company’s disaggregated revenues by segment. These notes disaggregate revenue recognized from contracts with customers into categories that depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Contract Balances and Costs Contract liabilities relate to deferred income and advanced customer deposits with respect to product sales. The following table presents outstanding contract liabilities and the amount of outstanding April 1, 2019 contract liabilities that were recognized as revenue during the quarter June 30, 2019:
Contract assets primarily relate to deposits paid to customers. The following table presents the amount of contract assets as of April 1, 2019 and June 30, 2019:
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Business Combinations |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations | Business Combinations Acquisition of Worthington Aviation Parts, Inc. On May 4, 2018, Air T, Inc. completed the acquisition (the “Transaction”) of substantially all of the assets and assumed certain liabilities of Worthington Aviation Parts, Inc. (“Worthington”), pursuant to the Asset Purchase Agreement (the “Purchase Agreement”), dated as of April 6, 2018, by and among the Company, Worthington, and Churchill Industries, Inc., as guarantor of Worthington’s obligations as disclosed in the Purchase Agreement. Worthington is primarily engaged in the business of operating, distributing and selling airplane and aviation parts along with repair services. The Company agreed to acquire the assets and liabilities in exchange for payment to Worthington of $50,000 as earnest money upon execution of the Agreement and a cash payment of $3,300,000 upon closing. Total consideration is summarized in the table below:
The Transaction was accounted for as a business combination in accordance with ASC Topic 805 "Business Combinations." Assets acquired and liabilities assumed were recorded in the accompanying consolidated balance sheet at their estimated fair values as of May 4, 2018, with the excess of fair value of net assets acquired recorded as a bargain purchase gain. The most significant asset acquired was Worthington’s inventory. The following table outlines the consideration transferred and purchase price allocation at the respective estimated fair values as of May 4, 2018:
The transaction resulted in a bargain purchase gain because Worthington was a non-marketed transaction and in financial distress at the time of the acquisition. The seller engaged in a formal bidding process and determined Air T was the best option for Worthington. The tax impact related to the bargain purchase gain was to record a deferred tax liability and record tax expense against the bargain purchase gain of approximately $589,000. The resulting net bargain purchase gain after taxes was approximately $1,983,000. Total transaction costs incurred in connection with this acquisition were approximately $83,000. Pro forma financial information is not presented as the results are not material to the Company’s consolidated financial statements. |
Restricted Cash |
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Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Restricted Cash | Restricted Cash The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows:
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Cash Surrender Value of Life Insurance |
3 Months Ended |
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Jun. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Cash Surrender Value of Life Insurance | Cash Surrender Value of Life Insurance The Company is the beneficiary of corporate-owned life insurance policies on certain former employees with a net cash surrender value of approximately $101,259 and $122,062 at June 30, 2019 and March 31, 2019, respectively. |
Income Taxes |
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Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Tax | Income Taxes During the three months ended June 30, 2019, the Company recorded $324,000 in income tax benefit at an effective rate of (8.46)%. The Company records income taxes using an estimated annual effective tax rate for interim reporting. The primary factors contributing to the difference between the federal statutory rate of 21% and the Company's effective tax rate for the three months ended June 30, 2019 were the change in valuation allowance related to Delphax, the estimated benefit for the exclusion of income for the Company's captive insurance company subsidiary under Section 831(b), the liquidation of Delphax UK and Delphax Canada as mentioned in Footnote 13 and the exclusion from the tax provision of the minority owned portion of the pretax income of Contrail Aviation Support, LLC. During the three months ended June 30, 2018, the Company recorded $387,000 in income tax expense which resulted in an effective tax rate of 10.50%. The primary factors contributing to the difference between the federal statutory rate and the Company's effective tax rate for the three months ended June 30, 2018 were related to the estimated benefit for the exclusion of income for the Company's captive insurance company subsidiary afforded under Section 831(b) and the presentation of the tax impact of the Worthington bargain purchase gain and state income tax expense. |
Net Earnings Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Earnings Per Share | Net Earnings Per Share Basic earnings per share has been calculated by dividing net income (loss) attributable to Air T, Inc. stockholders by the weighted average number of common shares outstanding during each period. For purposes of calculating diluted earnings per share, shares issuable under stock options were considered potential common shares and were included in the weighted average common shares unless they were anti-dilutive. The computation of basic and diluted earnings per common share is as follows:
On June 10, 2019, the Company effected a three-for-two stock split of its common stock in the form of a 50% stock dividend to shareholders of record as of June 4, 2019. All share and earnings per share information have been retroactively adjusted to reflect the stock split and the incremental par value of the newly-issued shares was recorded with the offset to additional paid-in capital. With respect to our June 30, 2019 Quarterly Report on Form 10-Q, the effect of the stock split was recognized retroactively in the stockholders’ equity accounts in the Condensed Consolidated Balance Sheets, and in all share data in the Condensed Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations. With respect to our March 31, 2019 Annual Report on Form 10-K, the effect of the stock split on per share amounts and weighted average common shares outstanding for each of the two fiscal years ended March 31, 2019 and March 31, 2018 are as follows:
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Investments in Securities |
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Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in Securities | Investments in Securities As of June 30, 2019, the Company had a gross unrealized gain aggregating to $319,000 and gross unrealized losses aggregating to $268,000, which are included in the Consolidated Statement of Income. All investments in marketable securities are priced using publicly quoted market prices and are considered Level 1 fair value measurements. |
Equity Method Investments |
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Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments | Equity Method Investments 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. At June 30, 2019, the Company held approximately 3.5 million shares of Insignia’s common stock representing approximately 30% of the outstanding shares. For the quarter ended June 30, 2019, the Company recorded approximately $322,000 as its share of Insignia’s net loss for the three months ended March 31, 2019 along with a basis difference adjustment of approximately $24,000. In addition, due to the adverse financial results as reported in Insignia's Form 10Q for the quarter ended March 31, 2019, the Company determined that it has suffered from an other-than-temporary impairment in its investment in Insignia . As such, the Company recorded an impairment charge of $814,558 during the quarter ended June 30, 2019. After the impairment, the Company's net investment basis in Insignia is $4,001,106 as of June 30, 2019. Summarized unaudited financial information for Insignia for the three months ended March 31, 2019 and March 31, 2018 is as follows:
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Inventories |
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Inventories | Inventories Inventories consisted of the following:
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Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | Leases The Company has operating leases for the use of real estate, machinery, and office equipment. The majority of our leases have a lease term of 2 to 5 years; however, we have certain leases with longer terms of up to 30 years. Many of our leases include options to extend the lease for an additional period. The lease term for all of the Company’s leases includes the non-cancellable period of the lease, plus any additional periods covered by either a Company option to extend the lease that the Company is reasonably certain to exercise, or an option to extend the lease controlled by the lessor that is considered likely to be exercised. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments. Variable payments are typically operating costs associated with the underlying asset and are recognized when the event, activity, or circumstance in the lease agreement on which those payments are assessed occurs. Our leases do not contain residual value guarantees. The Company has elected to combine lease and non-lease components as a single component and not to recognize leases on the balance sheet with an initial term of one year or less. The interest rate implicit in lease contracts is typically not readily determinable, and as such the Company utilizes the incremental borrowing rate to calculate lease liabilities, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The components of lease cost for the quarter ended are as follows:
Amounts reported in the consolidated balance sheets for leases where we are the lessee as of the quarter ended June 30, 2019 were as follows:
Maturities of lease liabilities under non-cancellable leases where we are the lessee as of the quarter ended June 30, 2019 are as follows:
At March 31, 2019, future minimum annual lease payments (foreign currency amounts translated using applicable March 31, 2019 exchange rates) are as follows:
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Financing Arrangements |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Arrangements | Financing Arrangements Borrowings of the Company and its subsidiaries are summarized below at June 30, 2019 and March 31, 2019, respectively. AirCo, Contrail Aviation (“Contrail”) are subsidiaries of the Company in the commercial jet engines and parts segment.
At June 30, 2019, our contractual financing obligations, including payments due by period, are as follows:
On June 10, 2019, the Company completed a transaction with all holders of the Company’s Common Stock to receive a special, pro-rata distribution of three securities as enumerated below:
The issuance of the TruPs and Warrants is disclosed on our consolidated statements of equity as well as within the supplemental non-cash disclosure of the Company's consolidated statements of cash flows. As of June 30, 2019, 840,924 Warrants have been exercised. As a result, the amount outstanding on the Company's Debt - Trust Preferred Securities is $6,102,310 as of June 30, 2019. At June 30, 2019, the Company had Warrants outstanding and exercisable to purchase 7,559,076 shares of its TruPs at an exercise price of $2.40 per share, which represents a discount to the $2.50 face value of each Trust Preferred Security. The Warrants will expire on June 7, 2020 or earlier upon redemption or liquidation.
As of June 30, 2019, the Warrants are recorded within "Other non-current liabilities" on our consolidated balance sheets. Fair value measurement was based on market activity and trading volume as observed on the NASDAQ Global Market. The liability is classified as Level 2 in the hierarchy (Level 2 is defined as quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability). On April 3, 2019, AirCo entered into a revolving line of credit agreement with MBT in the amount of $10,000,000 with a maturity date of November 30, 2019. The annual interest rate is stated at the greater of 6.50% or the sum of the Prime Rate plus 2.00%. AirCo used the proceeds from this transaction to pay off the outstanding balances on their term loans. The Company assumes various financial obligations and commitments in the normal course of its operations and financing activities. Financial obligations are considered to represent known future cash payments that the Company is required to make under existing contractual arrangements such as debt and lease agreements. As part of the Company’s interest rate risk management strategy, the Company, from time to time, uses derivative instruments to minimize significant unanticipated earnings fluctuations that may arise from rising variable interest rate costs associated with existing borrowings (Air T Term Note A and Term Note D). To meet these objectives, the Company entered into interest rate swaps with notional amounts consistent with the outstanding debt to provide a fixed rate of 4.56% and 5.09%, respectively, on Term Notes A and D. The swaps mature in January 2028. As of August 1, 2018, these swap contracts were designated as cash flow hedging instruments and qualified as effective hedges in accordance with ASC 815-30. The effective portion of changes in the fair value on these instruments is recorded in other comprehensive income and is reclassified into the consolidated statement of income as interest expense in the same period in which the underlying hedge transaction affects earnings. As of June 30, 2019 and March 31, 2019, the fair value of the interest-rate swap contracts was a liability of $456,000 and $227,000, respectively, which is included within other non-current liabilities in the consolidated balance sheets. During the three months ended June 30, 2019, the Company recorded a loss of approximately $176,038, net of tax, in the consolidated statement of comprehensive income for changes in the fair value of the instruments. |
Variable Interest Entities |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entities | Variable Interest Entities A variable interest entity ("VIE") is an entity that either (i) has insufficient equity to permit the entity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. Under ASC 810 - Consolidation, an entity that holds a variable interest in a VIE and meets certain requirements would be considered to be the primary beneficiary of the VIE and required to consolidate the VIE in its consolidated financial statements. In order to be considered the primary beneficiary of a VIE, an entity must hold a variable interest in the VIE and have both:
The Company concluded that its investments in Delphax’s equity and debt, and its investment in the Delphax warrant, each constituted a variable interest. In addition, the Company concluded that it became the primary beneficiary of Delphax on November 24, 2015. The Company consolidated Delphax in its consolidated financial statements beginning on that date. The following table sets forth the carrying values of Delphax’s assets and liabilities as of June 30, 2019 and March 31, 2019:
Upon petition by the Company, on August 8, 2017 the Ontario Superior Court of Justice in Bankruptcy and Insolvency adjudged Delphax Canada to be bankrupt. As a result, Delphax Canada ceased to have capacity to deal with its property, which then vested in the trustee in bankruptcy of Delphax Canada subject to the rights of secured creditors. As of June 30, 2019, the bankruptcy proceedings were finalized in accordance with Canadian law and, therefore, Delphax Canada was legally discharged of its liabilities. The conclusion of the bankruptcy proceedings also resulted in the dissolution of Delphax Canada. In addition, on June 11, 2019, the Company has also fully dissolved Delphax UK. As such, the only Delphax entity that remains in existence as of June 30, 2019 is Delphax France. The Company extinguished the assets and liabilities of Delphax Canada and Delphax UK during the quarter ended June 30, 2019 and recognized a gain on dissolution of entities of $4,509,302. Delphax’s revenues and expenses are included in our consolidated financial statements beginning November 24, 2015 through June 30, 2019. Revenues and expenses prior to the date of initial consolidation were excluded. We have determined that the attribution of Delphax net income or loss should be based on consideration of all of Air T’s investments in Delphax and Delphax Canada. The Delphax warrant provides that in the event that dividends are paid on the common stock of Delphax, the holder of the Warrant is entitled to participate in such dividends on a ratable basis as if the Warrant had been fully exercised and the shares of Series B Preferred Stock acquired upon such exercise had been converted into shares of Delphax common stock. This provision would have entitled Air T, Inc. to approximately 67% of any Delphax dividends paid, with the remaining 33% paid to the non-controlling interests. We concluded that this was a substantive distribution right which should be considered in the attribution of Delphax net income or loss to non-controlling interests. We furthermore concluded that our investment in the debt of Delphax should be considered in attribution. Specifically, Delphax’s net losses are attributed first to our Series B Preferred Stock and Warrant investments and to the non-controlling interest (67%/33%) until such amounts are reduced to zero. Additional losses are then fully attributed to our debt investments until they too are reduced to zero. This sequencing reflects the relative priority of debt to equity. Any further losses are then attributed to Air T and the non-controlling interests based on the initial 67%/33% share. Delphax net income is attributed using a backwards-tracing approach with respect to previous losses. As a result of the application of the above-described attribution methodology, for the quarters ended June 30, 2019 and June 30, 2018 the attribution of Delphax losses to non-controlling interests was 33% and 33%, respectively. The following table sets forth the revenue and expenses of Delphax prior to intercompany eliminations that are included in the Company’s condensed consolidated statement of income for the three months ended June 30, 2019 and 2018.
Unconsolidated Variable Interest Entities and Other Entities As discussed in Note 3, BCCM Advisors holds equity interests in certain investment funds as of June 30, 2019 and March 31, 2019. The Company determined that the equity interests it holds as the general partner in the following funds are variable interests based on the applicable GAAP guidance: Blue Clay Capital Partners CO I LP, Blue Clay Capital Partners CO III LP, Blue Clay Capital SMid-Cap LO LP and AO Partners II LP. However, the Company further determined that these funds should not be consolidated as BCCM Advisors is not the primary beneficiary of these variable interest entities. The Company determined that its equity interest in the Blue Clay Capital Master Fund Ltd. is not a variable interest and should not be consolidated based on the applicable GAAP guidance. The Company’s total investment within these investment funds at June 30, 2019 is valued at approximately $318,020. The Company’s exposure to loss is limited to its initial investment. As mentioned in Footnote 12, Financing Arrangements, the Company formed the Trust to issue and distribute TruPs and Warrants to our existing shareholders. The Company determined that it holds variable interest in the Trust and therefore, is the primary beneficiary of the Trust. As such, the Company consolidated the Trust as of June 30, 2019. |
Share Repurchase |
3 Months Ended |
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Jun. 30, 2019 | |
Equity [Abstract] | |
Share Repurchase | Share Repurchase On May 14, 2014, the Company announced that its Board of Directors had authorized a program to repurchase up to 750,000 shares of the Company’s common stock from time to time on the open market or in privately negotiated transactions, in compliance with SEC Rule 10b-18, over an indefinite period. During the three months ended June 30, 2019, the Company repurchased 17,424 shares at an aggregate cost of $126,317. These shares are reflected as retired as of June 30, 2019 in accordance with the intent of the authorized share repurchase program. The Company has reduced common stock and retained earnings to reflect the retirement of those shares. |
Geographical Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Geographical information | Geographical information Total property and equipment, including assets on lease, net of accumulated depreciation, located in the United States, the Company's country of domicile, and held outside the United States are summarized in the following table as of June 30, 2019 and March 31, 2019:
The Company's tangible long-lived assets, net of accumulated depreciation, held outside of the United States represent engines and aircraft on lease at June 30, 2019. The net book value located within each individual country at June 30, 2019 and March 31, 2019 is listed below:
Total revenue, in and outside the United States is summarized in the following table for the three months ended June 30, 2019 and June 30, 2018:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information The Company has six business segments: overnight air cargo, ground equipment sales, ground support services, commercial jet engine and parts segment, printing equipment and maintenance and corporate and other. Segment data is summarized as follows:
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Commitments and Contingencies |
3 Months Ended |
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Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Contrail Aviation Support, LLC (“Contrail Aviation”), a subsidiary of the Company, completed the purchase of all of the assets owned by Contrail Aviation Support, Inc. (the “Seller”) in July 2016. As part of this purchase, Contrail Aviation agreed to pay contingent additional deferred consideration of up to a maximum of $1,500,000 per year and $3,000,000 in the aggregate. The Company established a liability with a present value of $2,900,000 in the initial allocation of purchase price. This is based on the expectation that the earn-out will be paid at the maximum level. The Company has paid $2,500,000 of contingent consideration as of June 30, 2019 and the remaining liability of $497,000, which is entirely current, is included in the “Other accrued expenses” in the consolidated balance sheet as of June 30, 2019. Contrail Aviation entered into an Operating Agreement (the “Operating Agreement”) with the Seller providing for the governance of and the terms of membership interests in Contrail Aviation and including put and call options (“Put/Call Option”). The Put/Call Option permits the Seller to require Contrail Aviation to purchase all of the Seller’s equity membership interests in Contrail Aviation commencing on the fifth anniversary of the acquisition, which is on July 18, 2021. The Company has presented this redeemable non-controlling interest in Contrail Aviation between the liabilities and equity sections of the accompanying consolidated balance sheets. In addition, the company has elected to recognize changes in the redemption value immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting period. The fair value of the redeemable non-controlling interest is $6,685,000. The change in the redemption value for the three months ended June 30, 2019 is $1,209,000, of which $985,024 related to the change in fair value, which is reflected on our consolidated statements of equity. |
Subsequent Events |
3 Months Ended |
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Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Management performs an evaluation of events that occur after the balance sheet date but before consolidated financial statements are issued for potential recognition or disclosure of such events in its consolidated financial statements. Management is not aware of any subsequent events as of the date of issuance. |
Financial Statement Presentation (Policies) |
3 Months Ended |
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Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) as amended by multiple standards updates. The new standard provides that a lessee should recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee will recognize in the statement of financial position a liability to make lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term. For leases with a term of twelve months or less, the lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. The standard is effective for fiscal years beginning after December 15, 2018, including interim periods within such fiscal year, with early adoption permitted. Topic 842 permits two transition methods: (1) a modified retrospective transition method requiring retrospective adjustment of each comparative presented with an adjusting entry at the beginning of the earliest comparative period presented and (2) a modified retrospective approach with no restatement of prior periods and an adjusting entry as of the effective date. Under both transition methods, entities may elect certain transition practical expedients that would be required to be applied to all leases. The Company adopted the standard in the fiscal year beginning April 1, 2019 using the modified retrospective transition method that does not require retrospective adjustment of the comparative periods. The Company reviewed existing leases to determine the impact of the adoption of the standard on its consolidated financial statements. Implementation had an immaterial cumulative effect on retained earnings. Adoption resulted in the recognition of right-of-use assets of approximately $10.7 million, and lease liabilities of approximately $11.2 million. Upon adoption, the Company elected practical expedients related to a) short term lease exemption b) not separate lease and non-lease components c) not reassess whether expired or existing contracts contain leases, d) not reassess lease classification for existing or expired leases and e) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This standard significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income, including trade receivables. The standard requires an entity to estimate its lifetime “expected credit loss” for such assets at inception, and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. For public business entities that are U.S. Securities and Exchange Commission (SEC) filers, the amendments in this update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods therein. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. This ASU simplifies how an entity is required to test goodwill for impairment by eliminating Step Two from the goodwill impairment test. Step Two measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill. Under this standard, an entity will recognize an impairment charge for the amount by which the carrying value of a reporting unit exceeds its fair value. The standard is effective for any interim goodwill impairment tests in fiscal years beginning after December 15, 2019 and is to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In August 2018, the FASB amended the Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement Topic of the Accounting Standards Codification. The amendment is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. The amendment includes different transition requirements based on the disclosure topic. Changes to disclosure requirements for unrealized gains and losses, the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements, and the narrative description of measurement uncertainty should be applied prospectively for only the most recent interim or annual period presented in the initial fiscal year of adoption. All other required disclosure changes should be applied retrospectively to all periods presented upon their effective date. Early adoption is permitted upon issuance of this update. An entity is permitted to early adopt any removed or modified disclosures upon issuance of the update and delay adoption of the additional disclosures until their effective date. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In August 2018, the FASB amended the Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract Topic of the Accounting Standards Codification. The amendment is effective for public business entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. For all other entities, the amendments in this update are effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021. Early adoption of the amendments in the update is permitted, including adoption in any interim period, for all entities. The amendments in the update should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. In October 2018, the FASB updated the Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest Entities of the Accounting Standards Codification. The amendments in this update affect reporting entities that are required to determine whether they should consolidate a legal entity under the guidance within the Variable Interest Entities Subsections of Subtopic 810-10, Consolidation—Overall. Indirect interests held through related parties in common control arrangements should be considered on a proportional basis for determining whether fees paid to decision makers and service providers are variable interests. The amendments in this update are effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company expects the adoption of the standard will not have a material impact on its consolidated financial statements and disclosures. |
Revenue Recognition (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following table summarizes disaggregated revenues by type:
The following table summarizes total revenues by segment:
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Contract with Customer, Asset and Liability | The following table presents outstanding contract liabilities and the amount of outstanding April 1, 2019 contract liabilities that were recognized as revenue during the quarter June 30, 2019:
Contract assets primarily relate to deposits paid to customers. The following table presents the amount of contract assets as of April 1, 2019 and June 30, 2019:
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Business Combinations (Tables) - Worthington Aviation Parts, Inc |
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Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Business Acquisitions, by Acquisition | Total consideration is summarized in the table below:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table outlines the consideration transferred and purchase price allocation at the respective estimated fair values as of May 4, 2018:
|
Restricted Cash (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||
Cash and Cash Equivalents [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that sum to the total of the same such amounts shown in the Consolidated Statement of Cash Flows:
|
Net Earnings Per Share (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The computation of basic and diluted earnings per common share is as follows:
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Schedule of Weighted Average Number of Shares | With respect to our March 31, 2019 Annual Report on Form 10-K, the effect of the stock split on per share amounts and weighted average common shares outstanding for each of the two fiscal years ended March 31, 2019 and March 31, 2018 are as follows:
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Equity Method Investments (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity Method Investments and Joint Ventures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized Unaudited Financial Information | Summarized unaudited financial information for Insignia for the three months ended March 31, 2019 and March 31, 2018 is as follows:
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Inventories (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventory, Current | Inventories consisted of the following:
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Leases (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease, Cost | The components of lease cost for the quarter ended are as follows:
Amounts reported in the consolidated balance sheets for leases where we are the lessee as of the quarter ended June 30, 2019 were as follows:
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Lessee, Operating Lease, Liability, Maturity | under non-cancellable leases where we are the lessee as of the quarter ended June 30, 2019 are as follows:
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Schedule of Future Minimum Rental Payments for Operating Leases | At March 31, 2019, future minimum annual lease payments (foreign currency amounts translated using applicable March 31, 2019 exchange rates) are as follows:
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Financing Arrangements (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Borrowings of the Company and its subsidiaries are summarized below at June 30, 2019 and March 31, 2019, respectively. AirCo, Contrail Aviation (“Contrail”) are subsidiaries of the Company in the commercial jet engines and parts segment.
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Schedule of Maturities of Long-term Debt | At June 30, 2019, our contractual financing obligations, including payments due by period, are as follows:
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Schedule of Warrant Fair Value |
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Variable Interest Entities (Tables) - Delphax |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Balance Sheet | The following table sets forth the carrying values of Delphax’s assets and liabilities as of June 30, 2019 and March 31, 2019:
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Condensed Income Statement | The following table sets forth the revenue and expenses of Delphax prior to intercompany eliminations that are included in the Company’s condensed consolidated statement of income for the three months ended June 30, 2019 and 2018.
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Geographical Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-lived Assets by Geographic Areas | Total property and equipment, including assets on lease, net of accumulated depreciation, located in the United States, the Company's country of domicile, and held outside the United States are summarized in the following table as of June 30, 2019 and March 31, 2019:
The Company's tangible long-lived assets, net of accumulated depreciation, held outside of the United States represent engines and aircraft on lease at June 30, 2019. The net book value located within each individual country at June 30, 2019 and March 31, 2019 is listed below:
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Revenue from External Customers by Geographic Areas | Total revenue, in and outside the United States is summarized in the following table for the three months ended June 30, 2019 and June 30, 2018:
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Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | Segment data is summarized as follows:
|
Financial Statement Presentation (Details Textual) - USD ($) |
Jun. 30, 2019 |
Apr. 01, 2019 |
Mar. 31, 2019 |
---|---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 10,071,405 | $ 0 | |
Operating lease liabilities | $ 10,558,383 | ||
Accounting Standards Update 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease right-of-use assets | $ 10,700,000 | ||
Operating lease liabilities | $ 11,200,000 |
- Contract with Customer, Asset and Liability (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Apr. 01, 2019 |
|
Revenue from Contract with Customer [Abstract] | ||
Contract with customer, liabilities | $ 8,393,700 | $ 1,866,843 |
Outstanding contract liabilities recognized as revenue | 447,341 | |
Contract with customer, assets | $ 4,621,096 | $ 1,743,460 |
Business Combinations (Details Textual) - USD ($) |
3 Months Ended | ||
---|---|---|---|
May 04, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Business Acquisition [Line Items] | |||
Bargain purchase gain recognized | $ 34,244 | $ 1,983,777 | |
Worthington Aviation Parts, Inc | |||
Business Acquisition [Line Items] | |||
Payment for earnest money deposit | $ 50,000 | ||
Cash consideration | $ 3,300,000 | ||
Deferred income taxes | 589,000 | ||
Bargain purchase gain recognized | 1,983,000 | ||
Acquisition related costs | $ 83,000 |
Business Combinations - Summary of Total Consideration (Details) - Worthington Aviation Parts, Inc |
May 04, 2018
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Earnest money | $ 50,000 |
Cash consideration | 3,300,000 |
Less: Cash acquired | (24,301) |
Total consideration | $ 3,325,699 |
Business Combinations - Assets Acquired and Liabilities Assumed by Worthington (Details) - USD ($) |
3 Months Ended | ||
---|---|---|---|
May 04, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Business Acquisition [Line Items] | |||
Consideration paid | $ 500,000 | $ 3,325,700 | |
Worthington Aviation Parts, Inc | |||
Business Acquisition [Line Items] | |||
Accounts receivable | $ 1,929,120 | ||
Inventories | 4,564,437 | ||
Other current assets | 149,792 | ||
Property and equipment | 391,892 | ||
Other assets | 189,607 | ||
Total assets | 7,362,848 | ||
Accounts payable | 1,289,150 | ||
Accrued expenses | 175,222 | ||
Deferred tax liability | 589,000 | ||
Total liabilities | 2,053,372 | ||
Net assets acquired | 5,309,476 | ||
Consideration paid | 3,350,000 | ||
Less: Cash acquired | (24,301) | ||
Bargain purchase gain | 1,983,777 | ||
Worthington Aviation Parts, Inc | Trade Names | |||
Business Acquisition [Line Items] | |||
Intangible assets - tradename | $ 138,000 |
Restricted Cash - Cash, Cash Equivalent and Restricted Cash (Details) - USD ($) |
Jun. 30, 2019 |
Mar. 31, 2019 |
Jun. 30, 2018 |
Mar. 31, 2018 |
---|---|---|---|---|
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 16,196,626 | $ 12,524,321 | ||
Restricted cash | 68,979 | 123,409 | ||
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 16,265,605 | $ 12,647,730 | $ 5,765,353 | $ 5,072,897 |
Cash Surrender Value of Life Insurance (Details Textual) - USD ($) |
Jun. 30, 2019 |
Mar. 31, 2019 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Cash surrender value of life insurance policies, net of policy loans | $ 101,259 | $ 122,062 |
Income Taxes (Details Textual) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) | $ (324,000) | $ 387,000 |
Effective income tax rate, percent | (8.46%) | 10.50% |
Net Earnings Per Share (Details Textual) |
Jun. 10, 2019 |
Jun. 04, 2019 |
---|---|---|
Earnings Per Share [Abstract] | ||
Stock split conversion ratio | 1.5 | |
Common stock dividend rate percentage | 50.00% |
Net Earnings Per Share - Earnings Per Common Share (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Earnings Per Share [Abstract] | ||||
Net Income Attributable to Air T, Inc. Stockholders | $ 1,782,352 | $ 2,828,694 | $ 1,339,995 | $ 2,277,109 |
Income Per Share: | ||||
Basic (in dollars per share) | $ 0.79 | $ 0.92 | $ 0.44 | $ 0.74 |
Diluted (in dollars per share) | $ 0.79 | $ 0.92 | $ 0.44 | $ 0.74 |
Weighted Average Shares Outstanding: | ||||
Basic (in shares) | 2,252,698 | 3,065,411 | 3,052,124 | 3,064,209 |
Diluted (in shares) | 2,256,868 | 3,074,547 | 3,059,838 | 3,071,528 |
Net Earnings Per Share - Weighted Average Number of Shares (Details) - USD ($) |
3 Months Ended | 12 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Earnings Per Share [Abstract] | ||||
Net Income Attributable to Air T, Inc. Shareholders | $ 1,782,352 | $ 2,828,694 | $ 1,339,995 | $ 2,277,109 |
Weighted-average common shares outstanding | ||||
Basic (in shares) | 2,252,698 | 3,065,411 | 3,052,124 | 3,064,209 |
Diluted (in shares) | 2,256,868 | 3,074,547 | 3,059,838 | 3,071,528 |
Earnings Per Share Reconciliation [Abstract] | ||||
Basic (in dollars per share) | $ 0.79 | $ 0.92 | $ 0.44 | $ 0.74 |
Diluted (in dollars per share) | $ 0.79 | $ 0.92 | $ 0.44 | $ 0.74 |
Investments in Securities (Details Textual) $ in Thousands |
Jun. 30, 2019
USD ($)
|
---|---|
Investments, Debt and Equity Securities [Abstract] | |
Aggregate unrealized gain | $ 319 |
Aggregate unrealized loss | $ 268 |
Equity Method Investments (Details Textual) - USD ($) shares in Millions |
3 Months Ended | ||
---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Mar. 31, 2019 |
|
Income (loss) from equity method investments | $ 320,578 | $ (9,183) | |
Impairment charges | 814,558 | 0 | |
Equity method investments | $ 4,475,738 | $ 5,610,874 | |
Insignia | |||
Number of shares held (in shares) | 3.5 | ||
Ownership percentage | 30.00% | ||
Income (loss) from equity method investments | $ 322,000 | $ (5,000) | |
Difference between carrying amount and underlying equity | 24,000 | ||
Equity method investments | 4,001,106 | ||
Fence Store LLC | |||
Impairment charges | $ 814,558 |
Equity Method Investments - Summarized Unaudited Financial Information (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Net income (loss) attributable to Air T, Inc. stockholders | $ (320,578) | $ 9,183 |
Insignia | ||
Revenue | 5,140,000 | 7,419,000 |
Gross Profit | 774,000 | 2,746,000 |
Operating income (loss) | (1,337,000) | 232,000 |
Net income (loss) | (1,096,000) | 164,000 |
Net income (loss) attributable to Air T, Inc. stockholders | $ (322,000) | $ 5,000 |
Inventories - Inventories (Details) - USD ($) |
Jun. 30, 2019 |
Mar. 31, 2019 |
---|---|---|
Inventory [Line Items] | ||
Ground support service parts | $ 2,580,196 | $ 2,553,949 |
Printing equipment and maintenance | ||
Commercial jet engines and parts | 27,691,133 | 21,031,558 |
Total inventories | 36,722,092 | 30,164,437 |
Reserves | (193,315) | (197,400) |
Total inventories, net of reserves | 36,528,777 | 29,967,037 |
Ground equipment manufacturing: | ||
Ground equipment manufacturing: | ||
Raw materials | 3,017,469 | 2,497,876 |
Work in process | 1,351,370 | 1,659,516 |
Finished goods | 643,763 | 972,542 |
Printing equipment and maintenance | ||
Raw materials | 3,017,469 | 2,497,876 |
Finished goods | 643,763 | 972,542 |
Printing equipment and maintenance | ||
Ground equipment manufacturing: | ||
Raw materials | 0 | 401,103 |
Finished goods | 1,438,161 | 1,047,893 |
Printing equipment and maintenance | ||
Raw materials | 0 | 401,103 |
Finished goods | $ 1,438,161 | $ 1,047,893 |
Leases (Details Textual) |
Jun. 30, 2019 |
---|---|
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 2 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lease term | 5 years |
Real Estate | |
Lessee, Lease, Description [Line Items] | |
Lease term | 30 years |
Leases - Component of Lease Cost and Consolidated Balance Sheet Amounts (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Mar. 31, 2019 |
|
Leases [Abstract] | ||
Operating lease cost | $ 819,854 | |
Short-term lease cost | 274,156 | |
Variable lease cost | 135,613 | |
Sublease income | 0 | |
Total lease cost | 1,229,623 | |
Operating leases | ||
Operating lease right-of-use assets | 10,071,405 | $ 0 |
Total lease liabilities | $ 10,558,383 | |
Weighted-average remaining lease term | ||
Operating leases | 12 years 1 month | |
Weighted-average discount rate | ||
Operating leases | 4.51% |
Leases - Future Minimum Lease Payments (Details) |
Jun. 30, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
2020 (excluding the three months ended June 30, 2019) | $ (2,267,538) |
2021 | (2,122,870) |
2022 | (1,621,902) |
2023 | (1,268,783) |
2024 | (691,886) |
2025 | (457,798) |
Thereafter | (5,809,603) |
Total undiscounted lease payments | (14,240,380) |
Less: Interest | (3,023,181) |
Less: Discount | (658,816) |
Total lease liabilities | $ (10,558,383) |
Leases - Future Minimum Rental Payments (Details) |
Mar. 31, 2019
USD ($)
|
---|---|
Leases [Abstract] | |
2020 | $ 3,133,000 |
2021 | 2,115,000 |
2022 | 1,625,000 |
2023 | 1,241,000 |
2024 | 692,000 |
Thereafter | 6,267,000 |
Total minimum lease payments | $ 15,073,000 |
Financing Arrangements - Contractual Financing Obligations (Details) - USD ($) |
Jun. 30, 2019 |
Mar. 31, 2019 |
---|---|---|
Debt Disclosure [Abstract] | ||
June 30, 2020 | $ 27,774,151 | |
June 30, 2021 | 17,319,212 | |
June 30, 2022 | 3,567,200 | |
June 30, 2023 | 1,567,200 | |
June 30, 2024 | 1,567,200 | |
Thereafter | 12,606,710 | |
Long-term debt, gross | 64,401,673 | $ 58,021,749 |
Less: Unamortized Debt Issuance Costs | (341,612) | (368,760) |
Total Debt, net | $ 64,060,061 | $ 57,652,989 |
Financing Arrangements - Schedule of Warrant Fair Value (Details) |
Jun. 30, 2019
USD ($)
|
---|---|
Debt Disclosure [Abstract] | |
Warrant liability (Level 2) | $ 755,907 |
Variable Interest Entities (Details Textual) - USD ($) |
3 Months Ended | ||
---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Mar. 31, 2019 |
|
Variable Interest Entity [Line Items] | |||
Gain on settlement of bankruptcy | $ 4,509,302 | $ 0 | |
Investments in funds | $ 318,020 | $ 463,892 | |
Delphax | |||
Variable Interest Entity [Line Items] | |||
Percentage of consolidated subsidiaries dividends attributable to parent | 67.00% | ||
Percentage of consolidated subsidiaries dividends attributable to noncontrolling interests | 33.00% | ||
Net income (loss) attributable to noncontrolling interest, percentage | 33.00% | 33.00% | |
Delphax | Delphax Senior Credit Agreement | |||
Variable Interest Entity [Line Items] | |||
Short-term debt | $ 0 | ||
Investment Funds Purchased from Blue Clay Capital Management, LLC | |||
Variable Interest Entity [Line Items] | |||
Investments in funds | $ 318,020 |
Variable Interest Entities - Revenue and Expenses of Delphax Included in the Company's Consolidated Statements of Operations (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Variable Interest Entity [Line Items] | ||
Total | $ 55,704,535 | $ 60,867,469 |
General and administrative | 10,919,320 | 8,584,803 |
Operating Expenses | 54,492,836 | 58,263,767 |
Operating Loss | 1,211,699 | 2,603,702 |
Non-operating Income (Expenses), net | 2,619,960 | 1,065,409 |
Income Before Income Taxes | 3,831,659 | 3,669,111 |
Income Taxes | (324,000) | 387,000 |
Net Income | 4,155,659 | 3,282,111 |
Delphax | ||
Variable Interest Entity [Line Items] | ||
Total | 0 | 0 |
Cost of sales | 0 | 0 |
General and administrative | 72,748 | 52,260 |
Operating Expenses | 72,748 | 52,260 |
Operating Loss | (72,748) | (52,260) |
Non-operating Income (Expenses), net | 6,237,385 | (87,917) |
Income Before Income Taxes | 6,164,637 | (140,177) |
Income Taxes | 0 | 0 |
Net Income | $ 6,164,637 | $ (140,177) |
Share Repurchase (Details Textual) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
May 14, 2014 |
|
Equity [Abstract] | ||
Stock repurchase program, number of shares authorized to be repurchased (in shares) | 750,000 | |
Stock repurchased during period, shares (in shares) | 17,424 | |
Stock repurchased during period, value | $ 126,317 |
Geographical Information - Long-lived Assets By Geographic Region (Details) - USD ($) |
Jun. 30, 2019 |
Mar. 31, 2019 |
---|---|---|
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | $ 22,734,633 | $ 29,982,409 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | 4,865,948 | 4,946,997 |
Foreign | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | 17,868,685 | 25,035,412 |
Australia | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | 3,594 | 5,186 |
Mexico | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | 2,262,967 | 2,680,825 |
Netherlands | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | 5,350,275 | 5,541,072 |
China | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Non-current Assets | $ 10,251,849 | $ 16,808,329 |
Geographical Information - Revenue by Geographic Areas (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Revenue, Major Customer [Line Items] | ||
Total | $ 55,704,535 | $ 60,867,469 |
United States | ||
Revenue, Major Customer [Line Items] | ||
Total | 46,127,349 | 54,662,311 |
Foreign | ||
Revenue, Major Customer [Line Items] | ||
Total | $ 9,577,186 | $ 6,205,158 |
Segment Information (Details Textual) |
3 Months Ended |
---|---|
Jun. 30, 2019
segment
| |
Segment Reporting [Abstract] | |
Number of operating segments | 6 |
Commitments and Contingencies (Details Textual) - USD ($) |
3 Months Ended | 35 Months Ended | |
---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2019 |
Jul. 18, 2016 |
|
Business Acquisition, Contingent Consideration [Line Items] | |||
Fair value of redeemable non-controlling interest | $ 6,685,000 | $ 6,685,000 | |
Change in redemption value | 1,209,000 | ||
Adjustment to fair value of redeemable non-controlling interest | (985,024) | ||
Contrail Aviation Support LLC. | Contrail Aviation Inc. | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Contingent consideration maximum per year | $ 1,500,000 | ||
Contingent consideration aggregate | 3,000,000 | ||
Recognized identifiable assets acquired and liabilities assumed, earnout liability | $ 2,900,000 | ||
Change in amount of contingent consideration liability | 2,500,000 | ||
Current remaining liability | $ 497,000 | $ 497,000 |
Label | Element | Value |
---|---|---|
Accounting Standards Update 2016-02 [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (41,130) |
Accounting Standards Update 2016-02 [Member] | Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (41,130) |
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