[X]
|
QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
|
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Nevada
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95--1480559
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(State or other Jurisdiction of Incorporation)
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(I.R.S. Employer Identification No.)
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Large Accelerated Filer [ ]
|
Accelerated Filer [ ]
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Non-Accelerated Filer [ ]
(Do not check if a smaller reporting company)
|
Smaller
Reporting
Company [X]
|
Emerging
Growth
Company [ ]
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
|
PART I - FINANCIAL INFORMATION
|
||
Page
|
||
Item 1.
|
Consolidated Financial Statements
|
|
Consolidated Balance Sheets as of March 31, 2018 (Unaudited)
and December 30, 2017
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3
|
|
Unaudited Consolidated Statements of Income for the Thirteen
Week Periods Ended March 31, 2018 and April 1, 2017
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4
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Unaudited Consolidated Statements of Comprehensive Income for the
Thirteen Week Periods Ended March 31, 2018 and April 1, 2017
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5
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Unaudited Consolidated Statement of Changes in Stockholders' Equity
for the Thirteen Week Period Ended March 31, 2018
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6
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Unaudited Consolidated Statements of Cash Flows for the
Thirteen Week Periods Ended March 31, 2018 and April 1, 2017
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7
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Notes to Unaudited Consolidated Financial Statements
|
8
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|
Item 2.
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Management's Discussion and Analysis of Financial Condition
and Results of Operations
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23
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Item 3.
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Quantitative and Qualitative Disclosures About Market Risk
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34
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Item 4.
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Controls and Procedures
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34
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PART II - OTHER INFORMATION
|
||
Item 1.
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Legal Proceedings
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35
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Item 1A.
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Risk Factors
|
35
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Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
|
35
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Item 3.
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Defaults Upon Senior Securities
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35
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Item 4.
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Mine Safety Disclosures
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35
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Item 5.
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Other Information
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35
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Item 6.
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Exhibits
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36
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Signatures
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37
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ITEM 1.
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CONSOLIDATED FINANCIAL STATEMENTS
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March 31,
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December 30,
|
|||||
2018
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2017
|
|||||
(Unaudited)
|
||||||
Current assets:
|
||||||
Cash and cash equivalents
|
$452
|
$2,851
|
||||
Accounts receivable, net
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51,913
|
46,080
|
||||
Transit accounts receivable
|
1,089
|
3,002
|
||||
Prepaid expenses and other current assets
|
3,662
|
3,706
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||||
Total current assets
|
57,116
|
55,639
|
||||
Property and equipment, net
|
3,337
|
3,446
|
||||
Other assets:
|
||||||
Deposits
|
226
|
215
|
||||
Goodwill
|
11,685
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11,685
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||||
Intangible assets, net
|
87
|
105
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||||
Deferred tax assets, net, domestic
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2,101
|
2,189
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||||
Total other assets
|
14,099
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14,194
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||||
Total assets
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$74,552
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$73,279
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Current liabilities:
|
|||||||
Accounts payable and accrued expenses
|
$7,404
|
$8,634
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|||||
Transit accounts payable
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1,503
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4,661
|
|||||
Accrued payroll and related costs
|
7,696
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7,780
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|||||
Income taxes payable
|
98
|
372
|
|||||
Liability for contingent consideration from acquisitions
|
741
|
741
|
|||||
Total current liabilities
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17,442
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22,188
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|||||
Deferred tax liability, foreign
|
428
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431
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|||||
Liability for contingent consideration from acquisitions
|
1,350
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1,350
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|||||
Borrowings under line of credit
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32,014
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27,279
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|||||
Total liabilities
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51,234
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51,248
|
|||||
Stockholders' equity:
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|||||||
Preferred stock, $1.00 par value; 5,000,000 shares authorized;
|
|||||||
no shares issued or outstanding
|
-
|
-
|
|||||
Common stock, $0.05 par value; 40,000,000 shares authorized;
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|||||||
15,062,930 shares issued and 12,239,758 shares outstanding at
March 31, 2018 and 15,017,522 shares issued and 12,194,350 shares outstanding at December 30, 2017
|
753
|
751
|
|||||
Additional paid-in capital
|
104,844
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104,540
|
|||||
Accumulated other comprehensive loss
|
(2,465
|
)
|
(2,395
|
)
|
|||
Accumulated deficit
|
(64,827
|
)
|
(65,878
|
)
|
|||
Treasury stock (2,823,172 shares at March 31, 2018 and
|
|
|
|
|
|||
December 30, 2017) at cost
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(14,987 | ) | (14,987 | ) | |||
Stockholders' equity
|
23,318
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22,031
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|||||
Total liabilities and stockholders' equity
|
$74,552
|
$73,279
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
Thirteen Week Periods Ended March 31, 2018 and April 1, 2017
(Unaudited)
(In thousands, except per share amounts)
|
Thirteen Weeks Ended
|
|||||
March 31,
2018
|
April 1,
2017
|
||||
Revenues
|
$50,812
|
$46,341
|
|||
Cost of services
|
38,257
|
34,589
|
|||
Gross profit
|
12,555
|
11,752
|
|||
Operating costs and expenses
|
|||||
Selling, general and administrative
|
10,421
|
10,317
|
|||
Depreciation and amortization
|
414
|
397
|
|||
Operating costs and expenses
|
10,835
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10,714
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|||
Operating income
|
1,720
|
1,038
|
|||
Other income (expense)
|
|||||
Interest expense and other, net
|
(266
|
)
|
(138
|
)
|
|
(Loss) gain on foreign currency transactions
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(41
|
)
|
2
|
||
Other income (expense)
|
(307
|
)
|
(136
|
)
|
|
Income before income taxes
|
1,413
|
902
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|||
Income tax expense
|
362
|
352
|
|||
Net income
|
$1,051
|
$550
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|||
Basic and diluted net earnings per share
|
$0.09
|
$0.05
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Thirteen Week Periods Ended March 31, 2018 and April 1, 2017
(Unaudited)
(In thousands)
|
March 31,
2018
|
April 1,
2017
|
||
Net income
|
$1,051
|
$550
|
|
Other comprehensive (loss) income
|
(70
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)
|
4
|
Comprehensive income
|
$981
|
$554
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Thirteen Week Period Ended March 31, 2018
(Unaudited)
(In thousands, except share amounts)
|
Common Stock
|
Additional
Paid-in
Capital
|
Accumulated
Other
Comprehensive
Loss
|
Accumulated
Deficit
|
Treasury Stock
|
Total
|
|||||||||||
Issued
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||
Balance, December 30, 2017
|
15,017,522
|
$751
|
$104,540
|
($2,395
|
)
|
($65,878
|
)
|
2,823,172
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($14,987
|
)
|
$22,031
|
|||||
Issuance of stock under
employee stock purchase plan
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45,408
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2
|
192
|
-
|
-
|
-
|
-
|
194
|
||||||||
Translation adjustment
|
-
|
-
|
-
|
(70
|
)
|
-
|
-
|
-
|
(70
|
)
|
||||||
Share-based compensation expense
|
-
|
-
|
112
|
-
|
-
|
-
|
-
|
112
|
||||||||
Net income
|
-
|
-
|
-
|
-
|
1,051
|
-
|
-
|
1,051
|
||||||||
Balance, March 31, 2018
|
15,062,930
|
$753
|
$104,844
|
($2,465
|
)
|
($64,827
|
)
|
2,823,172
|
($14,987
|
)
|
$23,318
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Thirteen Week Periods Ended March 31, 2018 and April 1, 2017
(Unaudited)
(In thousands)
|
March 31,
2018
|
April 1,
2017
|
||||||
Cash flows from operating activities:
|
|||||||
Net income
|
$1,051
|
$550
|
|||||
Adjustments to reconcile net income to net cash (used in) provided by
operating activities:
|
|||||||
Depreciation and amortization
|
414
|
397
|
|||||
Share-based compensation expense
|
112
|
203
|
|||||
Provision for losses on accounts receivable
|
162
|
161
|
|||||
Deferred income tax expense
|
91
|
98
|
|||||
Changes in assets and liabilities:
|
|||||||
Accounts receivable
|
(6,078
|
)
|
663
|
||||
Prepaid expenses and other current assets
|
(2
|
)
|
(21
|
)
|
|||
Net of transit accounts receivable and payable
|
(1,243
|
)
|
217
|
||||
Accounts payable and accrued expenses
|
(1,212
|
)
|
(607
|
)
|
|||
Accrued payroll and related costs
|
(70
|
)
|
51
|
||||
Income taxes payable
|
(269
|
)
|
157
|
||||
Total adjustments
|
(8,095
|
)
|
1,319
|
||||
Net cash (used in) provided by operating activities
|
(7,044
|
)
|
1,869
|
||||
Cash flows from investing activities:
|
|||||||
Property and equipment acquired
|
(289
|
)
|
(92
|
)
|
|||
Decrease in deposits
|
(11
|
)
|
-
|
||||
Net cash used in investing activities
|
(300
|
)
|
(92
|
)
|
|||
Cash flows from financing activities:
|
|||||||
Borrowings under line of credit
|
23,716
|
22,058
|
|||||
Repayments under line of credit
|
(18,982
|
)
|
(23,644
|
)
|
|||
Issuance of stock for employee stock purchase plan
|
194
|
192
|
|||||
Common stock repurchases
|
-
|
(365
|
)
|
||||
Contingent consideration paid
|
-
|
(8
|
)
|
||||
Net cash provided by (used in) financing activities
|
4,928
|
(1,767
|
)
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
17
|
4
|
|||||
(Decrease) increase in cash and cash equivalents
|
(2,399
|
)
|
14
|
||||
Cash and cash equivalents at beginning of period
|
2,851
|
279
|
|||||
Cash and cash equivalents at end of period
|
$452
|
$293
|
|||||
Supplemental cash flow information:
|
|||||||
Cash paid for:
|
|||||||
Interest
|
$167
|
$113
|
|||||
Income taxes
|
$304
|
$98
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
1.
|
Basis of Presentation
|
Period Ended
|
Weeks in Quarter
|
Weeks in Year to Date
|
March 31, 2018
|
Thirteen
|
Thirteen
|
April 1, 2017
|
Thirteen
|
Thirteen
|
2.
|
Use of Estimates and Uncertainties
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
2.
|
Use of Estimates and Uncertainties (Continued)
|
3.
|
Revenue Recognition
|
March 31,
2018
|
April 1,
2017
|
||
Engineering:
|
|||
Time and Material
|
$18,655
|
$16,698
|
|
Fixed Fee
|
2,763
|
2,526
|
|
Total Engineering
|
$21,418
|
$19,224
|
|
Specialty Health Care:
|
|||
Time and Material
|
$22,113
|
$17,881
|
|
Permanent Placement Services
|
521
|
626
|
|
Total Specialty Health Care
|
$22,634
|
$18,507
|
|
Information Technology:
|
|||
Time and Material
|
$6,668
|
$8,516
|
|
Permanent Placement Services
|
92
|
94
|
|
Total Information Technology
|
$6,760
|
$8,610
|
|
$50,812
|
$46,341
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
1.
|
Revenue Recognition (Continued)
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
March 31,
2018
|
December 30,
2017
|
|||
Billed
|
$33,405
|
$31,448
|
||
Accrued and unbilled
|
14,446
|
10,573
|
||
Work-in-progress
|
5,178
|
5,026
|
||
Allowance for sales discounts and doubtful accounts
|
(1,116
|
)
|
(967
|
)
|
Accounts receivable, net
|
$51,913
|
$46,080
|
5. |
Property and Equipment
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
5. |
Property and Equipment (Continued)
|
March 31,
2018
|
December 30,
2017
|
||
Equipment and furniture
|
$713
|
$938
|
|
Computers and systems
|
6,203
|
6,172
|
|
Leasehold improvements
|
702
|
899
|
|
7,618
|
8,009
|
||
Less: accumulated depreciation and amortization
|
4,281
|
4,563
|
|
Property and equipment, net
|
$3,337
|
$3,446
|
6. |
Acquisitions
|
Fiscal Years Ending
|
Total
|
December 29, 2018 (after March 31, 2018)
|
$741
|
December 28, 2019
|
625
|
January 2, 2021
|
725
|
Estimated future contingent consideration payments
|
$2,091
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
6. |
Acquisitions (Continued)
|
7. |
Goodwill
|
Engineering
|
Specialty Health Care
|
Information
Technology
|
Total
|
||||
Balance as of March 31, 2018 and
December 30, 2017
|
$7,249
|
$2,398
|
$2,038
|
$11,685
|
8. |
Intangible Assets
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
8. |
Intangible Assets (Continued)
|
Thirteen Weeks Ended
|
||||
March 31,
2018
|
April 1,
2017
|
|||
Customer contracts and relations
|
$74
|
$87
|
||
Non-compete agreements
|
13
|
18
|
||
Intangible assets
|
$87
|
$105
|
9. |
Line of Credit
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
10. |
Per Share Data
|
Thirteen Week Periods Ended
|
|||
March 31,
2018
|
April 1,
2017
|
||
Basic weighted average shares outstanding
|
12,238,760
|
11,946,653
|
|
Dilutive effect of outstanding restricted stock awards
|
18,747
|
101,114
|
|
Weighted average dilutive shares outstanding
|
12,257,507
|
12,047,767
|
March 31,
2018
|
December 30,
2017
|
||
Time-based restricted stock units outstanding
|
87,034
|
87,034
|
|
Performance-based restricted stock units outstanding
|
400,000
|
400,000
|
|
Future grants of options or shares
|
332,232
|
332,232
|
|
Shares reserved for employee stock purchase plan
|
131,872
|
177,280
|
|
Total
|
951,138
|
996,546
|
11. |
Share-Based Compensation
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
11. |
Share-Based Compensation (Continued)
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
11. |
Share-Based Compensation (Continued)
|
Number of
Time-Based
Restricted
Stock Units
|
Weighted
Average
Grant Date Fair
Value per Share
|
||
Outstanding non-vested at December 30, 2017
|
87,034
|
$5.88
|
|
Granted
|
-
|
-
|
|
Vested
|
-
|
-
|
|
Forfeited or expired
|
-
|
-
|
|
Outstanding non-vested at March 31, 2018
|
87,034
|
$5.88
|
Number of
Performance-Based
Restricted
Stock Units
|
Weighted
Average
Grant Date Fair
Value per Share
|
||
Outstanding non-vested at December 30, 2017
|
400,000
|
$5.11
|
|
Granted
|
-
|
-
|
|
Vested
|
-
|
-
|
|
Forfeited or expired
|
-
|
-
|
|
Outstanding non-vested at March 31, 2018
|
400,000
|
$5.11
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
11. |
Share-Based Compensation (Continued)
|
12. |
Treasury Stock Transactions
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
13. |
New Accounting Standards
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
14. |
Segment Information
|
Thirteen Week Period Ended
March 31, 2018
|
Engineering
|
Specialty Health Care
|
Information
Technology
|
Corporate
|
Total
|
||||
Revenue
|
$21,418
|
$22,634
|
$6,760
|
$ -
|
$50,812
|
||||
Cost of services
|
15,724
|
17,384
|
5,149
|
-
|
38,257
|
||||
Gross profit
|
5,694
|
5,250
|
1,611
|
-
|
12,555
|
||||
Selling, general and administrative
|
4,122
|
4,470
|
1,829
|
-
|
10,421
|
||||
Depreciation and amortization
|
283
|
105
|
26
|
-
|
414
|
||||
Operating income (loss)
|
$1,289
|
$675
|
($244
|
)
|
$ -
|
$1,720
|
|||
Total assets as of March 31, 2018
|
$36,578
|
$24,884
|
$6,573
|
$6,517
|
$74,552
|
||||
Capital expenditures
|
$109
|
$40
|
$9
|
$131
|
$289
|
Thirteen Week Period Ended
April 1, 2017
|
Engineering
|
Specialty Health Care
|
Information
Technology
|
Corporate
|
Total
|
||||
Revenue
|
$19,224
|
$18,507
|
$8,610
|
$ -
|
$46,341
|
||||
Cost of services
|
14,185
|
13,947
|
6,457
|
-
|
34,589
|
||||
Gross profit
|
5,039
|
4,560
|
2,153
|
-
|
11,752
|
||||
Selling, general and administrative
|
4,037
|
3,927
|
2,353
|
-
|
10,317
|
||||
Depreciation and amortization
|
285
|
72
|
40
|
-
|
397
|
||||
Operating income (loss)
|
$717
|
$561
|
($240
|
)
|
$ -
|
$1,038
|
|||
Total assets as of April 1, 2017
|
$32,014
|
$17,867
|
$11,903
|
$4,016
|
$65,800
|
||||
Capital expenditures
|
$69
|
$ -
|
$ -
|
$23
|
$92
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
14. |
Segment Information (Continued)
|
Thirteen Week Periods Ended
|
|||||
March 31,
2018
|
April 1,
2017
|
||||
Revenues
|
|||||
U. S.
|
$41,591
|
$38,718
|
|||
Canada
|
7,629
|
6,495
|
|||
Puerto Rico
|
983
|
1,128
|
|||
Serbia
|
609
|
-
|
|||
$50,812
|
$46,341
|
March 31,
2018
|
December 30, 2017
|
||||
Total assets
|
|||||
U. S.
|
$55,067
|
$52,595
|
|||
Canada
|
13,943
|
15,419
|
|||
Puerto Rico
|
1,838
|
1,891
|
|||
Serbia
|
3,704
|
3,374
|
|||
$74,552
|
$73,279
|
15. |
Income Taxes
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share amounts, unless otherwise indicated)
|
16.
|
Contingencies
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
March 31, 2018
|
April 1, 2017
|
|||||||
Amount
|
% of Revenue
|
Amount
|
% of Revenue
|
|||||
Revenues
|
$50,812
|
100.0
|
$46,341
|
100.0
|
||||
Cost of services
|
38,257
|
75.3
|
34,589
|
74.6
|
||||
Gross profit
|
12,555
|
24.7
|
11,752
|
25.4
|
||||
Selling, general and administrative
|
10,421
|
20.5
|
10,317
|
22.2
|
||||
Depreciation and amortization
|
414
|
0.8
|
397
|
0.9
|
||||
10,835
|
21.3
|
10,714
|
23.1
|
|||||
Operating income
|
1,720
|
3.4
|
1,038
|
2.3
|
||||
Interest expense, net and foreign currency transactions
|
(307
|
)
|
0.6
|
(136
|
)
|
0.3
|
||
Income before income taxes
|
1,413
|
2.8
|
902
|
2.0
|
||||
Income tax expense
|
362
|
0.7
|
352
|
0.8
|
||||
Net income
|
$1,051
|
2.1
|
$550
|
1.2
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
Thirteen Week Periods Ended
|
|||||
March 31,
2018
|
April 1,
2017
|
||||
Cash provided by (used in):
|
|||||
Operating activities
|
($7,044
|
)
|
$1,869
|
||
Investing activities
|
($300
|
)
|
($92
|
)
|
|
Financing activities
|
$4,928
|
($1,767
|
)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)
|
Fiscal Years Ending
|
Amount
|
2018 (after March 31, 2018)
|
$2,572
|
2019
|
1,749
|
2020
|
1,091
|
2021
|
523
|
2022
|
308
|
Total
|
$6,243
|
Fiscal Years Ending
|
Total
|
December 29, 2018 (after March 31, 2018)
|
$741
|
December 28, 2019
|
625
|
January 2, 2021
|
725
|
Estimated future contingent consideration payments
|
$2,091
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
•
|
Updated our policies and procedures related to recognizing revenue and added documentation processes related to meeting the new criteria for recognizing revenue.
|
•
|
Added controls to address related required disclosures regarding revenue, including the disclosure of performance obligations and our significant judgments and estimates for determining the transaction price and when to recognize revenue.
|
RCM TECHNOLOGIES, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
Tenth Amendment to Second Amended and Restated Amendment, dated as of February 14, 2018, to Amended and Restated Loan and Security Agreement dated as of February 19, 2009, by and among the Company and all of its subsidiaries, Citizens Bank of Pennsylvania, a Pennsylvania state chartered bank, in its capacity as administrative agent and arranger, and Citizens Bank of Pennsylvania, as lender; incorporated by reference to Exhibit 99.1 to the Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on February 20, 2018.
|
|
Certification of President and Chief Executive Officer Required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
Certification of Chief Financial Officer Required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
|
Certification of President and Chief Executive Officer Required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
|
|
Certification of Chief Financial Officer Required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended. (This exhibit shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Further, this exhibit shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.)
|
|
101.INS*
|
XBRL Instance Document
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Documents
|
101.DEF*
|
XBRL Taxonomy Definition Linkbase Document
|
RCM TECHNOLOGIES, INC.
SIGNATURES
|
RCM Technologies, Inc.
|
|||
Date: May 11, 2018
|
By: /s/ Rocco Campanelli
|
||
Rocco Campanelli
President and Chief Executive Officer
(Principal Executive Officer and
Duly Authorized Officer of the Registrant)
|
Date: May 11, 2018
|
By: /s/ Kevin D. Miller
|
||
Kevin D. Miller
Chief Financial Officer
(Principal Financial Officer and
Duly Authorized Officer of the Registrant)
|
(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: May 11, 2018
|
/s/ Rocco Campanelli
Rocco Campanelli
President and Chief Executive Officer
|
(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: May 11, 2018
|
/s/ Kevin D. Miller
Kevin D. Miller
Chief Financial Officer
|
(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: May 11, 2018
|
/s/ Rocco Campanelli
Rocco Campanelli
President and Chief Executive Officer
|
(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: May 11, 2018
|
/s/ Kevin D. Miller
Kevin D. Miller
Chief Financial Officer
|
Document And Entity Information - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
May 11, 2018 |
|
Document Information [Line Items] | ||
Entity Registrant Name | RCM TECHNOLOGIES INC | |
Entity Central Index Key | 0000700841 | |
Trading Symbol | rcmt | |
Current Fiscal Year End Date | --12-30 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 12,239,758 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares |
Mar. 31, 2018 |
Dec. 30, 2017 |
---|---|---|
Preferred stock par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.05 | $ 0.05 |
Common stock, authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock, issued (in shares) | 15,062,930 | 15,017,522 |
Common stock, outstanding (in shares) | 12,239,758 | 12,194,350 |
Treasury stock, shares (in shares) | 2,823,172 | 2,823,172 |
Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
|
Revenues | $ 50,812 | $ 46,341 |
Cost of services | 38,257 | 34,589 |
Gross profit | 12,555 | 11,752 |
Operating costs and expenses | ||
Selling, general and administrative | 10,421 | 10,317 |
Depreciation and amortization | 414 | 397 |
Operating costs and expenses | 10,835 | 10,714 |
Operating income | 1,720 | 1,038 |
Other income (expense) | ||
Interest expense and other, net | (266) | (138) |
(Loss) gain on foreign currency transactions | (41) | 2 |
Other income (expense) | (307) | (136) |
Income before income taxes | 1,413 | 902 |
Income tax expense | 362 | 352 |
Net income | $ 1,051 | $ 550 |
Basic and diluted net earnings per share (in dollars per share) | $ 0.09 | $ 0.05 |
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
|
Net income | $ 1,051 | $ 550 |
Other comprehensive (loss) income | (70) | 4 |
Comprehensive income | $ 981 | $ 554 |
Consolidated Statement of Changes in Stockholders' Equity (Unaudited) - 3 months ended Mar. 31, 2018 - USD ($) $ in Thousands |
Common Stock [Member] |
Additional Paid-in Capital [Member] |
AOCI Attributable to Parent [Member] |
Retained Earnings [Member] |
Treasury Stock [Member] |
Total |
---|---|---|---|---|---|---|
Balance (in shares) at Dec. 30, 2017 | 15,017,522 | 2,823,172 | ||||
Balance at Dec. 30, 2017 | $ 751 | $ 104,540 | $ (2,395) | $ (65,878) | $ (14,987) | $ 22,031 |
Issuance of stock under employee stock purchase plan (in shares) | 45,408 | |||||
Issuance of stock under employee stock purchase plan | $ 2 | 192 | 194 | |||
Translation adjustment | (70) | (70) | ||||
Share-based compensation expense | 112 | 112 | ||||
Net income | 1,051 | 1,051 | ||||
Balance (in shares) at Mar. 31, 2018 | 15,062,930 | 2,823,172 | ||||
Balance at Mar. 31, 2018 | $ 753 | $ 104,844 | $ (2,465) | $ (64,827) | $ (14,987) | $ 23,318 |
Note 1 - Basis of Presentation |
3 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 | ||||||||||||
Notes to Financial Statements | ||||||||||||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] |
The accompanying consolidated interim financial statements of RCM Technologies, Inc. and subsidiaries (“RCM” or the “Company”) are unaudited. The year-end consolidated balance sheet was derived from audited statements but does not include all disclosures required by accounting principles generally accepted in the United States. These statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission pertaining to reports on Form 10 -Q and should be read in conjunction with the Company’s consolidated financial statements and the notes thereto for the year ended December 30, 2017 included in the Company’s Annual Report Form 10 -K for such period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations.The consolidated financial statements for the unaudited interim periods presented include all adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of financial position, results of operations and cash flows for such interim periods. Results for the thirteen week periods ended March 31, 2018 are not necessarily indicative of results that may be expected for the full year.Fiscal Year The Company follows a 52/53 week fiscal reporting calendar ending on the Saturday closest to December 31. The fiscal year ended December 30, 2017 was a 52 -week reporting year. The first fiscal quarters of 2018 and 2017 ended on the following dates, respectively:
|
Note 2 - Use of Estimates and Uncertainties |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2018 | |||
Notes to Financial Statements | |||
Basis of Presentation and Significant Accounting Policies [Text Block] |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and disclosure of contingent assets and liabilities. Actual results could differ from those estimates. The Company uses estimates to calculate an allowance for doubtful accounts on its accounts receivables, adequacy of reserves, goodwill impairment, if any, equity compensation, the tax rate applied and the valuation of certain assets and liability accounts. These estimates can be significant to the operating results and financial position of the Company. The Company has risk participation arrangements with respect to workers compensation and health care insurance. The amounts included in the Company’s costs related to this risk participation are estimated and can vary based on changes in assumptions, the Company’s claims experience or the providers included in the associated insurance programs. The Company can be affected by a variety of factors including uncertainty relating to the performance of the general economy, competition, demand for the Company’s services, adverse litigation and claims and the hiring, training and retention of key employees. F air Value of Financial Instruments The Company’s carrying value of financial instruments, consisting primarily of accounts receivable, transit accounts receivable, accounts payable and accrued expenses, and transit accounts payable and borrowings under line of credit approximates fair value due to their liquidity or their short-term nature. The Company does not have derivative products in place to manage risks related to foreign currency fluctuations for its foreign operations or for interest rate changes. |
Note 3 - Revenue Recoginition |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Text Block] |
As of December 31, 2017, the Company adopted Accounting Standards Update ("ASU") 2014 -09, Revenue from Contracts with Customers ("ASC using the modified retrospective approach. Revenues are recognized when we satisfy a performance obligation by transferring services promised in a contract to a customer, in an amount that reflects the consideration that we expect to receive in exchange for those services. Performance obligations in our contracts represent distinct or separate service streams that we provide to our customers. The adoption of ASC 606" ),606 did not result in an adjustment to retained earnings in the Company’s consolidated balance sheet as of December 31, 2017. We evaluate our revenue contracts with customers based on the five -step model under ASC 606: (1 ) Identify the contract with the customer; (2 ) Identify the performance obligations in the contract; (3 ) Determine the transaction price; (4 ) Allocate the transaction price to separate performance obligations; and (5 ) Recognize revenue when (or as) each performance obligation is satisfied.The Company derives its revenues from several sources. The Company’s Engineering Services and Information Technology Services segments perform consulting and project solution services. All of the Company’s segments perform staff augmentation services and derive revenue from permanent placement fees. The majority of the Company’s revenues are invoiced on a time and materials basis. The following table presents our revenues disaggregated by revenue source for the thirteen weeks periods ending March 31, 2018 and April 1, 2017:
Time and Material The Company’s IT and Healthcare segments predominantly recognize revenue through time and material work while our Engineering segment recognizes revenue through both time and material and fixed fee work. The Company’s time and material contracts are typically based on the number of hours worked at contractually agreed upon rates, therefore revenues associated with these time and materials contracts are recognized based on hours worked at contracted rates. Fixed fee From time to time and predominantly our Engineering segment, the Company will enter into contracts requiring the completion of specific deliverables. The Company has master services agreements with many of its customers that broadly define terms and conditions. Actual services performed under fixed fee arrangements are typically delivered under purchase orders that more specifically define terms and conditions related to that fixed fee project. While these master services agreements can often span several years, the Company’s fixed fee purchase orders are typically performed over six to nine month periods. In instances where project services are provided on a fixed-price basis, revenue is recorded in accordance with the terms of each contract. In certain instances, revenue is invoiced at the time certain milestones are reached, as defined in the contract. Revenues under these arrangements are recognized as the costs on these contracts are incurred. On an infrequent basis, amounts paid in excess of revenues earned and recognized are recorded as deferred revenue, included in accounts payable and accrued expenses on the accompanying balance sheets. In other instances, revenue is billed and recorded based upon contractual rates per hour. Additionally, some contracts contain “Performance Fees” (bonuses) for completing a contract under budget. Performance Fees, if any, are recorded when earned. Some contracts also limit revenues and billings to specified maximum amounts. Provisions for contract losses, if any, are made in the period such losses are determined. For contracts where there is a specific deliverable, the work is not complete and the revenue is not recognized, the costs incurred are deferred as a prepaid asset. The associated costs are expensed when the related revenue is recognized.Permanent Placement Services The Company earns permanent placement fees from providing permanent placement services. These fees are typically based on a percentage of the compensation paid to the person placed with the Company’s client. The deferred revenue balance at March 31, 2018 and December 30, 2017 was $302 and $596, respectively and is included in accounts payable and accrued expense in the accompanying consolidated balance sheet. Revenue is recognized when the service has been performed. This revenue can be recognized over a period exceeding one year from the time it was recorded on the balance sheet as deferred revenue. For the thirteen week period ended March 31, 2018, the Company recognized revenue of $295 that was included in deferred revenue at the beginning of the reporting period. The March 31, 2018 balance in deferred revenue will be recognized in fiscal year 2018. |
Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] |
The Company’s accounts receivable are comprised as follows:
Unbilled receivables primarily represent revenues earned whereby those services are ready to be billed as of the balance sheet ending date. Work-in-progress primarily represents revenues earned under contracts which the Company contractually invoices at future dates. From time to time, the Company’s Engineering segment enters into agreements to provide, among other things, construction management and engineering services. Pursuant to these agreements, the Company a) may engage subcontractors to provide construction or other services; b) typically earns a fixed percentage of the total project value; and c) assumes no ownership or risks of inventory. Under the terms of the agreements, the Company is typically not required to pay the subcontractor until after the corresponding payment from the Company’s end-client is received. Upon invoicing the end-client on behalf of the subcontractor or staffing agency the Company records this amount simultaneously as both a “transit account receivable” and “transit account payable” as the amount when paid to the Company is due to and generally paid to the subcontractor within a few days. The Company typically does not pay a given transit account payable until the related transit account receivable is collected. The Company’s transit accounts payable generally exceeds the Company’s transit accounts receivable but absolute amounts and spreads fluctuate significantly from quarter to quarter in the normal course of business. The transit accounts receivable was $1.1 million and related transit accounts payable was $1.5 million, for a net liability of $0.4 million, as of March 31, 2018. The transit accounts receivable was $3.0 million and related transit accounts payable was $4.7 million, a net payable of $1.7 million, as of December 30, 2017. The Company has a dispute with a customer that is a major utility in the United States. Essentially, the customer has not paid the balance of accounts receivable the Company believes are owed to the Company. The Company recently compelled arbitration with this customer. As of March 31, 2018 the total amount due from this customer is $5.9 million, subject to an upward adjustment following disclosures by the customer in the arbitration. Additionally, as part of the arbitration process, the customer has asserted counter claims of $9.3 million. The Company also believes these counter claims were retaliatory in nature. Prior to the arbitration, the customer had not asserted any claims. The Company believes these asserted claims have no merit and were merely asserted as a strategy to reduce the Company’s claims in any arbitration award or potential settlement agreement. The Company believes that its accounts receivable balance, subject to reserves, is collectible. Furthermore, the Company believes that this arbitration will conclude sometime late in fiscal year 2018 or early fiscal 2019. While the Company believes the customer’s counter claims to be frivolous and without merit, it can give no assurances that it will ultimately not have to pay all or a portion of such claims. The Company is continuing work on one of the engagements that have given rise to this dispute and also on several engagements from the same client that are not currently part of the arbitration. |
Note 5 - Property and Equipment |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes to Financial Statements | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment Disclosure [Text Block] |
Property and equipment are stated at cost and are depreciated on the straight-line method at rates calculated to provide for retirement of assets at the end of their estimated useful lives. The annual rates are 20% for computer hardware and software as well as furniture and office equipment. Leasehold improvements are amortized over the shorter of the estimated life of the asset or the lease term.Property and equipment are comprised of the following:
The Company periodically writes off fully depreciated and amortized assets. The Company wrote off fully depreciated and amortized assets of $681 and $355 during the thirteen week periods ended March 31, 2018 and April 1, 2017, respectively. Depreciation expense for the thirteen week periods ended March 31, 2018 and April 1, 2017 was $396 and $380, respectively. |
Note 6 - Acquisitions |
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Business Combination Disclosure [Text Block] |
The Company has acquired numerous companies throughout its history and those acquisitions have generally included significant future contingent consideration. The Company gives no assurance that it will make acquisitions in the future and if they do make acquisitions gives no assurance that such acquisitions will be successful.Future Contingent Payments As of March 31, 2018, the Company had six active acquisition agreements whereby additional contingent consideration may be earned by the former shareholders: 1 ) effective July 1, 2012 the Company acquired certain assets of BGA, LLC (“BGA”); 2 ) effective August 1, 2014 the Company acquired all of the stock of Point Comm, Inc. (“PCI”); 3 ) effective July 5, 2015, the Company acquired certain assets of Substation Design Services, LLC (“SDS”); 4 ) effective December 31, 2016, the Company acquired certain assets of Allied Health Professionals, LLC (“AHP”); 5 ) effective April 16, 2017 the Company acquired certain assets of R.A.F. Services, Inc. (“RAF”) and 6 ) effective October 1, 2017, the Company acquired all of the stock of PSR Engineering Solutions d.o.o. Beograd (Voždovac) (“PSR”). The Company estimates future contingent payments at March 31, 2018 as follows:
Estimates of future contingent payments are subject to significant judgment and actual payments may materially differ from estimates. Potential future contingent payments to be made to all active acquisitions are capped at cumulative maximum of $4.1 million. The Company estimates future contingent consideration in payments based on forecasted performance and recorded at the net present value of those expected payments as of March 31, 2018. The measurement is based on significant inputs that are not observable in the market, which “Fair Value Measurements and Disclosures” (ASU Topic 820 -10 -35 ) refers to as Level 3 inputs. There has been no change in the fair value of contingent consideration for the thirteen week period ended March 31, 2018. The Company did not pay contingent consideration during the thirteen week period ended March 31, 2018 and paid $8 for the thirteen week period ended April 1, 2017. RAF Effective April 16, 2017, the Company acquired the business operations of RAF. RAF has been in business since 1991 as a multi-disciplined engineering and consulting and design company, headquartered on Long Island. The firm has been providing Engineering, Design, Permitting, Inspection and Construction Management services to the utility, industrial, commercial, and property management industries. RAF specializes in turnkey above ground tank inspection, repair and cleaning services, as well as concrete, steel, masonry, and roofing routine maintenance inspection and design. The purchase price for RAF was $133, all of which was allocated to goodwill as follows: 1 ) assumed liabilities of $123; and 2 ) estimated contingent consideration of $10 was paid in fiscal 2017. PSR Effective October 1, 2017 the Company acquired all of the stock of PSR. PSR was established in Serbia in 2006 and specializes in the design and engineering associated with high voltage substations, design engineering for electrical equipment in power plants, 3D modeling, commissioning, site supervision and other engineering services for clients in Europe, North America, South America and the Middle East. At the time of acquisition, PSR had a highly trained staff of approximately 30 engineers. PSR has acted as a subcontractor to the Company for over three years. The total purchase price of $3,248 included cash at closing of $1,000, estimated contingent consideration of $1,763 and $485 due to seller upon realization of net working capital recorded at closing. As part of the working capital recorded at closing, the Company received cash of $237. The Company allocated $58 to fixed assets and the balance to goodwill. |
Note 7 - Goodwill |
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Goodwill Disclosure [Text Block] |
There were no changes in the carrying amount of goodwill for the thirteen week period ended March 31, 2018.
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Note 8 - Intangible Assets |
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Intangible Assets Disclosure [Text Block] |
The Company evaluates long-lived assets and intangible assets with definite lives for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When the Company determines that it is probable that undiscounted future cash flows will not be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value. Assets to be disposed of by sale, if any, are reported at the lower of the carrying amount or fair value less cost to sell. The Company’s intangible assets consist of customer relationships and non-compete agreements. During all periods presented, the Company determined that no Intangible assets are substantially attributable to the Company’s Engineering segment and include the following:
Amortization expense of intangible assets for the thirteen week periods ended March 31, 2018 and April 1, 2017 was $18 and $17, respectively. |
Note 9 - Line of Credit |
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Debt Disclosure [Text Block] |
The Company and its subsidiaries are party to a loan agreement with Citizens Bank of Pennsylvania which, as of March 31, 2018, provides for a $40 million revolving credit facility and includes a sub-limit of $5 million for letters of credit (the “Revolving Credit Facility”) and expires December 11, 2019. The Revolving Credit Facility has been amended several times, most recently pursuant to the Tenth Amendment entered into on February 14, 2018 when the Company increased the Revolving Credit Facility to $40 million from its previous amount of $35 million. The Company also entered into to the Ninth Amendment on December 8, 2017 when the Company was granted waivers that expressly allowed a cash dividend of up to $12.4 million and waived certain expenses from the Company’s loan covenant calculations, including $1.3 million of certain expenses related legal costs, office closures and other expenses in fiscal 2017, up to $1.0 million consulting expenses for analyzing tax credits for research and development costs and 179D energy savings tax credits on a rolling four quarter basis and up to $4.6 million for goodwill impairment. Borrowings under the Revolving Credit Facility bear interest at one of two alternative rates, as selected by the Company at each incremental borrowing. These alternatives are: (i) LIBOR (London Interbank Offered Rate), plus applicable margin, typically borrowed in fixed 30 -day increments or (ii) the agent bank’s prime rate generally borrowed over shorter durations. The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is not drawn. Unused line fees are recorded as interest expense. The effective interest rate, including unused line fees, for the thirteen week period ended March 31, 2018 was 3.0%. All borrowings under the Revolving Credit Facility are collateralized by all of the assets of the Company and its subsidiaries and a pledge of the stock of its subsidiaries. The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts on the Company’s ability to borrow in order to pay dividends. As of March 31, 2018, the Company was in compliance with all covenants contained in its Revolving Credit Facility.Borrowings under the line of credit as of March 31, 2018 and December 30, 2017 were $32.0 million and $27.3 million, respectively. At March 31, 2018 and December 30, 2017 there were letters of credit outstanding for $0.8 March 31, 2018, the Company had availability for additional borrowings under the Revolving Credit Facility of $7.2 million. |
Note 10 - Per Share Data |
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Earnings Per Share [Text Block] |
The Company uses the treasury stock method to calculate the weighted-average shares used for diluted earnings per share. The number of common shares used to calculate basic and diluted earnings per share for the thirteen week periods ended March 31, 2018 and April 1, 2017 was determined as follows:
For the thirteen week period ended March 31, 2018, there were no anti-dilutive shares not included in the calculation of common stock equivalents. For the thirteen week period ended April 1, 2017 there were 40,000 absolute anti-dilutive shares not included in the calculation of common stock equivalents. These were determined to be anti-dilutive because the exercise prices of these shares for the periods were higher than the average market price of the Company’s common stock for the same periods.Unissued shares of common stock were reserved for the following purposes:
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Note 11 - Share-based Compensation |
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Disclosure of Compensation Related Costs, Share-based Payments [Text Block] |
At March 31, 2018, the Company had two share-based employee compensation plans. The Company measures the fair value of share-based awards, if and when granted, based on the Black-Scholes method and using the closing market price of the Company’s common stock on the date of grant. Awards vest over periods ranging from one to three years and expire within 10 years of issuance. Share-based compensation expense related to time-based awards is amortized in accordance with applicable vesting periods using the straight-line method. The Company vests performance-based awards only when the performance metrics are likely to be achieved and the associated awards are therefore likely to vest. Performance-based share awards that are likely to vest are also expensed on a straight-line basis over the vesting period but may vest on a retroactive basis or be reversed, depending on when it is determined that they are likely to vest, or in the case of a reversal when they are later determined to be unlikely to vest.Share-based compensation expense of $112 and $203 was recognized for the thirteen week periods ended March 31, 2018 and April 1, 2017, respectively. Share based compensation for the thirteen week period ended March 31, 2018 did not include any expense associated with performance-based restricted stock units since they were, as of March 31, 2018, determined to be unlikely to vest.As of March 31, 2018, the Company had approximately $376 of total unrecognized compensation cost related to all time-based non-vested share-based awards granted under the Company’s various share-based plans, which the Company expects to recognize over approximately a two -year period. These amounts do not include a) performance-based restricted stock units, b) the cost of any additional share-based awards that may be granted in future periods or c) the impact of any potential changes in the Company’s forfeiture rate.Incentive S hare-Based Plans 2014 Omnibus Equity Compensation Plan (the 2014 Plan)The 2014 Plan, approved by the Company’s stockholders in December 2014, provides for the issuance of up to 625,000 shares of the Company’s common stock to officers, non-employee directors, employees of the Company and its subsidiaries or consultants and advisors utilized by the Company. In fiscal 2016, the Company amended the 2014 Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance under the Plan by an additional 500,000 shares so that the total number of shares of stock reserved for issuance under the Plan is 1,125,000 shares. The expiration date of the Plan is December 1, 2026. The Compensation Committee of the Board of Directors determines the vesting period at the time of grant.As of March 31, 2018, under the 2014 Plan, 87,034 time-based and 400,000 performance-based restricted share units were outstanding and 332,232 shares were available for awards thereunder.Employee Stock Purchase Plan The Company implemented the 2001 Employee Stock Purchase Plan (the “Purchase Plan”) with shareholder approval, effective January 1, 2001. Under the Purchase Plan, employees meeting certain specific employment qualifications are eligible to participate and can purchase shares of common stock semi-annually through payroll deductions at the lower of 85% of the fair market value of the stock at the commencement or end of the offering period. The purchase plan permits eligible employees to purchase shares of common stock through payroll deductions for up to 10% of qualified compensation.In fiscal 2015, the Company amended the Purchase Plan with shareholder approval to increase the aggregate number of shares of stock reserved for issuance or transfer under the Plan by an additional 300,000 shares so that the total number of shares of stock reserved for issuance or transfer under the Plan shall be 1,100,000 shares and to extend the expiration date of the Plan to December 31, 2025. The Company has two offering periods in the Purchase Plan coinciding with the Company’s first two fiscal quarters and the last two fiscal quarters. Actual shares are issued on the first business day of the subsequent offering period for the prior offering period payroll deductions. The number of shares issued at the beginning of the current period (on January 2, 2018) was 45,408. As of March 31, 2018, there were 131,872 shares available for issuance under the Purchase Plan.Time-Based Restricted Stock Units From time-to-time the Company issues time-based restricted stock units. These time-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period assuming the grantee’s restricted stock unit fully vests. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for time-based restricted stock units that ultimately do not vest are forfeited.To date, the Company has only issued time-based restricted stock units under the 2014 Plan. The following summarizes the activity in the time-based restricted stock units under the 2014 Plan during the thirteen week period ended March 31, 2018:
Based on the closing price of the Company’s common stock of $5.77 per share on March 29, 2018 ( the last trading day prior to March 31, 2018), the intrinsic value of the time-based non-vested restricted stock units at March 31, 2018 was approximately $502. As of March 31, 2018, there was approximately $376 of total unrecognized compensation cost related to time-based restricted stock units, which is expected to be recognized over the vesting period of the restricted stock units.Performance Based Restricted Stock Units From time-to-time the Company issues performance-based restricted stock units to its executives. Performance-based restricted stock units are typically vested based on certain multi-year performance metrics as determined by the Board of Directors Compensation Committee. These performance-based restricted stock units typically include dividend accrual equivalents, which means that any dividends paid by the Company during the vesting period become due and payable after the vesting period on any stock units that actually vest, if any. Dividends for these grants are accrued on the dividend payment dates and included in accounts payable and accrued expenses on the accompanying consolidated balance sheet. Dividends for performance-based restricted stock units that ultimately do not vest are forfeited. To date, the Company has only issued performance-based restricted stock units under the 2014 Plan. The following summarizes the activity in the performance-based restricted stock units during 2017:
As of March 31, 2018, the Company considers the metrics related to 400,000 of the performance-based restricted stock units unlikely to be achieved, thus no performance condition is probable of achievement and no compensation cost has been recognized on the performance-based restricted stock units. The Company will reassess at each reporting date whether achievement of any performance condition is probable and would begin recognizing compensation cost if and when achievement of the performance condition becomes probable. The Company will then recognize the appropriate expense cumulatively in the year performance becomes probable and recognize the remaining compensation cost over the remaining requisite service period. |
Note 12 - Treasury Stock Transactions |
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Treasury Stock [Text Block] |
On October 28, 2013, the Board of Directors authorized a repurchase program to purchase up to $5.0 million of outstanding shares of common stock at the prevailing market prices, from time to time over the subsequent 12 -month period. On September 30, 2014, the Board extended this repurchase program through October 31, 2015. On September 11, 2015, the Board extended this repurchase program through December 31, 2016. On August 9, 2016, the Board authorized an additional $5.0 million to the repurchase program and extended this repurchase program through December 31, 2017. For the thirteen week period ended March 31, 2018, the Company did not purchase any treasury shares. For the thirteen week period ended April 1, 2017, the Company purchased 59,312 shares at an average price of $6.16. As of March 31, 2018, the Company has $2.5 million available for future treasury stock purchases. |
Note 13 - New Accounting Standards |
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New Accounting Pronouncements and Changes in Accounting Principles [Text Block] |
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014 -09, (Topic 606 ) “Revenue from Contracts with Customers.” Topic 606 supersedes the revenue recognition requirement in Topic “Revenue Recognition” (Topic 605 ), and requires entities to recognize revenue when control of the promised good or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for goods or services. The Company adopted this standard in its fiscal 2018 first quarter using the modified retrospective approach. See Note 3 for further details.In February 2016, the FASB issued ASU 2016 -02, Leases (Topic in order to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under previous GAAP. ASU 842 ), 2016 -02 requires that a lessee should recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term on the balance sheet. ASU 2016 -02 is effective for fiscal years beginning after December 15, 2018 ( including interim periods within those periods) using a modified retrospective approach and early adoption is permitted. The Company will adopt ASU 2016 -02 in the first quarter of 2019.Although the Company is in the process of evaluating the impact of adoption of the ASU on its consolidated financial statements, the Company currently believes the most significant change will be related to the recognition of right-of-use assets and lease liabilities on the Company's balance sheet for real estate operating leases.In March 2016, the FASB issued ASU 2016 -09, Compensation – Stock Compensation (Topic . ASU 718 ): Improvement to Employee Share-based Payment Accounting2016 -09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities and classification on the statement of cash flows. Additionally, in May 2017, the FASB issued ASU 2017 -09, Compensation – Stock Compensation (Topic ASU 718 ). 2017 -09 clarifies which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting under ASC 718. The Company adopted ASU 2016 -09 in its fiscal 2017 first quarter. It did not have a material impact. ASU 2017 -09 is effective for annual and interim reporting periods beginning after December 15, 2017. The Company adopted ASU 2017 -09 in its fiscal 2018 first quarter. It did not have a material impact.In June 2016, the FASB issued ASU 2016 -13, Financial Instruments - Credit Losses (Topic The new standard amends guidance on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. This ASU is effective for financial statements issued for fiscal years beginning after 326 ). December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements.In August 2016, the FASB issued ASU No. 2016 -15, Statement of Cash Flows ( Topic 230 ): Classification of Certain Cash Receipts and Cash Payments . ASU 2016 -15 clarifies how certain cash receipts and payments should be presented in the statement of cash flows. The guidance requires application using a retrospective transition method. The Company adopted ASU 2016 -15 in its fiscal 2018 first quarter. It did not have a material impact.In January 2017, the FASB issued ASU No. 2017 -01, “Business Combinations” (Topic 805 ) to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The Company adopted ASU 2017 -01 in its fiscal 2018 first quarter. It did not have a material impact. |
Note 14 - Segment Information |
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Segment Reporting Disclosure [Text Block] |
The Company follows “Disclosures about Segments of an Enterprise and Related Information,” which establishes standards for companies to report information about operating segments, geographic areas and major customers. The accounting policies of each reportable segment are the same as those described in the summary of significant accounting policies (see Note 1 to the Company’s Consolidated Financial Statements included in its Annual Report on Form 10 -K for the year ended December 30, 2017). Segment operating income includes selling, general and administrative expenses directly attributable to that segment as well as charges for allocating corporate costs to each of the operating segments. The following tables reflect the results of the reportable segments consistent with the Company’s management system:
The Company derives a majority of its revenue from offices in the United States. Revenues reported for each operating segment are all from external customers. The Company is domiciled in the United States and its segments operate in the United States, Canada, Puerto Rico and Serbia. Revenues by geographic area for the thirteen week periods ended March 31, 2018 and April 1, 2017 are as follows:
Total assets by geographic area as of the reported periods are as follows:
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Note 15 - Income Taxes |
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Notes to Financial Statements | |||
Income Tax Disclosure [Text Block] |
On December 22, 2017, the SEC issued guidance under Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118” ) directing taxpayers to consider the impact of the Tax Act as “provisional” when it does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the change in tax law. The changes in the Tax Act are broad and complex. The final impacts of the Tax Act may differ from the Company’s estimates due to, among other things, changes in interpretations of the Tax Act, further legislation related to the Tax Act, changes in accounting standards for income taxes or related interpretations in response to the Tax Act, or any updates to estimates the Company has utilized to calculate the impacts of the Tax Act. The SEC has issued rules that would allow for a measurement period of up to one year after the enactment date of the Tax Act to finalize the related tax impacts. The Company currently anticipates finalizing any resulting adjustments by the end of its fiscal year ending December 29, 2018. The Company, based on current knowledge, estimated the impact of SAB 118 on its income tax provision for the fifty-two week period ended December 30, 2017. The total impact was an increase to its fiscal 2017 tax expense of $1.2 million, including $1.0 million for a reduction in deferred tax benefit and $0.2 million related to transition repatriation taxes. Any subsequent changes to the Company’s fiscal 2017 tax expense estimates, if any, could materially impact the Company’s fiscal 2018 tax provision. As of March 31, 2018, the Company is unaware of any factors or potential revisions that would materially change the Company’s estimated fiscal 2017 tax provision.The projected fiscal 2018 effective income tax rates as of March 31, 2018 for the thirteen week period ended March 31, 2018 are approximately 27.9%, 26.5% and 14.8% in the United States, Canada and Serbia, respectively, and yielded a consolidated effective income tax rate of approximately 25.6% for the thirteen week period ended March 31, 2018. The comparable prior year period estimated income tax rates were 41.6% and 26.5% in the United States and Canada, respectively, and yielded a consolidated effective income tax rate of approximately 39.0% for the thirteen week period ended April 1, 2017. The Company did not have Serbian operations for the comparable prior year period. The significant decrease in the tax rate in the United States for the thirteen week period ended March 31, 2018 as compared to the comparable prior year period was due to the reduction in the Company’s federal income tax rate to 21.0% from 34.0% as provided for in the Tax Cuts and Jobs Act. The relative income or loss generated in each jurisdiction can materially impact the overall effective income tax rate of the Company. |
Note 16 - Contingencies |
3 Months Ended | ||
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Mar. 31, 2018 | |||
Notes to Financial Statements | |||
Contingencies Disclosure [Text Block] |
From time to time, the Company is a defendant or plaintiff in various legal actions that arise in the normal course of business. As such, the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of losses and possible recoveries. The Company may not be covered by insurance as it pertains to some or all of these matters. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. Once established, a provision may change in the future due to new developments or changes in circumstances, and could increase or decrease the Company’s earnings in the period that the changes are made. Asserted claims in these matters sought approximately $10.0 million in damages (including $9.3 million in counter claims described below) as of March 31, 2018. As of March 31, 2018, the Company had an accrual of $0.1 million for any such liabilities.The Company has a dispute with a customer that is a major utility in the United States. Essentially, the customer has not paid the balance of accounts receivable the Company believes are owed to the Company. The Company recently compelled arbitration with this customer. As of March 31, 2018 the total amount due from this customer is $5.9 million, subject to an upward adjustment following disclosures by the customer in the arbitration. Additionally, as part of the arbitration process, the customer has asserted counter claims of $9.3 million. The Company also believes these counter claims were retaliatory in nature. Prior to the arbitration, the customer had not asserted any claims. The Company believes these asserted claims have no merit and were merely asserted as a strategy to reduce the Company’s claims in any arbitration award or potential settlement agreement. The Company believes that its accounts receivable balance, subject to reserves, is collectible. Furthermore, the Company believes that this arbitration will conclude sometime late in fiscal year 2018 or early fiscal 2019. While the Company believes the customer’s counter claims to be frivolous and without merit, it can give no assurances that it will ultimately not have to pay all or a portion of such claims. The Company is continuing work on one of the engagements that have given rise to this dispute and also on several engagements from the same client that are not currently part of the arbitration.The Company is also subject to other pending legal proceedings and claims that arise from time to time in the ordinary course of its business, which may not be covered by insurance. |
Note 3 - Revenue Recoginition (Tables) |
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Disaggregation of Revenue [Table Text Block] |
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Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable (Tables) |
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Note 5 - Property and Equipment (Tables) |
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Property, Plant and Equipment [Table Text Block] |
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Note 6 - Acquisitions (Tables) |
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Schedule of Business Acquisitions by Acquisition, Contingent Consideration [Table Text Block] |
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Note 7 - Goodwill (Tables) |
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Schedule of Goodwill [Table Text Block] |
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Note 8 - Intangible Assets (Tables) |
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Schedule of Acquired Finite-Lived Intangible Assets by Major Class [Table Text Block] |
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Note 10 - Per Share Data (Tables) |
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Schedule of Weighted Average Number of Shares [Table Text Block] |
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Unissued Shares of Common Stock [Table Text Block] |
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Note 11 - Share-based Compensation (Tables) |
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Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] |
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Note 14 - Segment Information (Tables) |
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Schedule of Segment Reporting Information, by Segment [Table Text Block] |
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Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block] |
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Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country [Table Text Block] |
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Note 3 - Revenue Recoginition (Details Textual) - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2018 |
Dec. 30, 2017 |
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Contract with Customer, Liability, Revenue Recognized | $ 295 | |
Accounts Payable and Accrued Liabilities [Member] | ||
Contract with Customer, Liability, Total | $ 302 | $ 596 |
Note 3 - Revenue Recognition - Revenues Disaggregated by Revenue Source (Details) - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2018 |
Apr. 01, 2017 |
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Revenues | $ 50,812 | $ 46,341 |
Engineering Services [Member] | ||
Revenues | 21,418 | 19,224 |
Health Care [Member] | ||
Revenues | 22,634 | 18,507 |
Technology Service [Member] | ||
Revenues | 6,760 | 8,610 |
Time-and-materials Contract [Member] | Engineering Services [Member] | ||
Revenues | 18,655 | 16,698 |
Time-and-materials Contract [Member] | Health Care [Member] | ||
Revenues | 22,113 | 17,881 |
Time-and-materials Contract [Member] | Technology Service [Member] | ||
Revenues | 6,668 | 8,516 |
Fixed-price Contract [Member] | Engineering Services [Member] | ||
Revenues | 2,763 | 2,526 |
Permanent Placement Services [Member] | Health Care [Member] | ||
Revenues | 521 | 626 |
Permanent Placement Services [Member] | Technology Service [Member] | ||
Revenues | $ 92 | $ 94 |
Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable (Details Textual) - USD ($) $ in Millions |
Mar. 31, 2018 |
Dec. 30, 2017 |
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Liabilities, Net | $ 0.4 | $ 1.7 |
Loss Contingency, Receivable, Ending Balance | 5.9 | |
Loss Contingency, Estimate of Possible Loss | 9.3 | |
Collectibility of Receivables [Member] | ||
Loss Contingency, Estimate of Possible Loss | 9.3 | |
Transit Accounts Payable [Member] | ||
Accounts Payable, Current, Total | 1.5 | 4.7 |
Transit Accounts Receivable [Member] | ||
Accounts Receivable, Gross, Current | $ 1.1 | $ 3.0 |
Note 4 - Accounts Receivable, Transit Accounts Receivable and Transit Accounts Payable - Accounts Receivable (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 30, 2017 |
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Allowance for sales discounts and doubtful accounts | $ (1,116) | $ (967) |
Accounts receivable, net | 51,913 | 46,080 |
Billed Revenues [Member] | ||
Accounts receivable, current | 33,405 | 31,448 |
Unbilled Revenues [Member] | ||
Accounts receivable, current | 14,446 | 10,573 |
Work In Progress [Member] | ||
Accounts receivable, current | $ 5,178 | $ 5,026 |
Note 5 - Property and Equipment (Details Textual) - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2018 |
Apr. 01, 2017 |
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Annual Depreciation Rate | 20.00% | |
Write Off of Fully Depreciated Property and Equipment | $ 681 | $ 355 |
Depreciation, Total | $ 396 | $ 380 |
Note 5 - Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 30, 2017 |
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Property and equipment | $ 7,618 | $ 8,009 |
Less: accumulated depreciation and amortization | 4,281 | 4,563 |
Property and equipment, net | 3,337 | 3,446 |
Equipment and Furniture [Member] | ||
Property and equipment | 713 | 938 |
Computers and Systems [Member] | ||
Property and equipment | 6,203 | 6,172 |
Leasehold Improvements [Member] | ||
Property and equipment | $ 702 | $ 899 |
Note 6 - Acquisitions - Maximum Deferred Consideration Payments (Details) $ in Thousands |
Mar. 31, 2018
USD ($)
|
---|---|
December 29, 2018 (after March 31, 2018) | $ 741 |
December 28, 2019 | 625 |
January 2, 2021 | 725 |
Estimated future contingent consideration payments | $ 2,091 |
Note 7 - Goodwill (Details Textual) $ in Thousands |
3 Months Ended |
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Mar. 31, 2018
USD ($)
| |
Goodwill, Period Increase (Decrease), Total | $ 0 |
Note 7 - Goodwill - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 30, 2017 |
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Balance | $ 11,685 | $ 11,685 |
Engineering [Member] | ||
Balance | 7,249 | |
Specialty Health Care [Member] | ||
Balance | 2,398 | |
Information Technology [Member] | ||
Balance | $ 2,038 |
Note 8 - Intangible Assets (Details Textual) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
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Impairment of Intangible Assets (Excluding Goodwill), Total | $ 0 | $ 0 |
Amortization of Intangible Assets, Total | $ 18 | $ 17 |
Note 8 - Intangible Assets - Intangible Assets by Class (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 30, 2017 |
Apr. 01, 2017 |
---|---|---|---|
Intangible assets, net | $ 87 | $ 105 | $ 105 |
Customer-Related Intangible Assets [Member] | |||
Intangible assets, net | 74 | 87 | |
Noncompete Agreements [Member] | |||
Intangible assets, net | $ 13 | $ 18 |
Note 10 - Per Share Data (Details Textual) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 40,000 |
Note 10 - Per Share Data - Weighted Average Number of Common Shares (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
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Basic weighted average shares outstanding (in shares) | 12,238,760 | 11,946,653 |
Dilutive effect of outstanding restricted stock awards (in shares) | 18,747 | 101,114 |
Weighted average dilutive shares outstanding (in shares) | 12,257,507 | 12,047,767 |
Note 10 - Per Share Data - Unissued Shares of Common Stock Were Reserved for the Following Purposes (Details) - shares |
Mar. 31, 2018 |
Dec. 30, 2017 |
---|---|---|
Future grants of options or shares (in shares) | 332,232 | 332,232 |
Shares reserved for employee stock purchase plan (in shares) | 131,872 | 177,280 |
Total (in shares) | 951,138 | 996,546 |
Time-based Restricted Stock Units [Member] | ||
Restricted stock units outstanding (in shares) | 87,034 | 87,034 |
Performance-based Restricted Stock Units [Member] | ||
Restricted stock units outstanding (in shares) | 400,000 | 400,000 |
Note 12 - Treasury Stock Transactions (Details Textual) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | |||
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Mar. 31, 2018 |
Apr. 01, 2017 |
Aug. 09, 2016 |
Oct. 28, 2013 |
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Stock Repurchase Program 2013 [Member] | ||||
Stock Repurchase Program, Authorized Amount | $ 5.0 | |||
Stock Repurchase Program, 2016 [Member] | ||||
Stock Repurchase Program, Authorized Amount | $ 5.0 | |||
Treasury Stock, Shares, Acquired | 0 | 59,312 | ||
Treasury Stock Acquired, Average Cost Per Share | $ 6.16 | |||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 2.5 |
Note 14 - Segment Information - Revenues by Geographic Area (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
|
Revenues | $ 50,812 | $ 46,341 |
UNITED STATES | ||
Revenues | 41,591 | 38,718 |
CANADA | ||
Revenues | 7,629 | 6,495 |
PUERTO RICO | ||
Revenues | 983 | 1,128 |
SERBIA | ||
Revenues | $ 609 |
Note 14 - Segment Information - Total Assets by Geographic Area (Details) - USD ($) $ in Thousands |
Mar. 31, 2018 |
Dec. 30, 2017 |
Apr. 01, 2017 |
---|---|---|---|
U. S. | $ 74,552 | $ 73,279 | $ 65,800 |
UNITED STATES | |||
U. S. | 55,067 | 52,595 | |
CANADA | |||
U. S. | 13,943 | 15,419 | |
PUERTO RICO | |||
U. S. | 1,838 | 1,891 | |
SERBIA | |||
U. S. | $ 3,704 | $ 3,374 |
Note 15 - Income Taxes (Details Textual) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended | |
---|---|---|---|
Mar. 31, 2018 |
Apr. 01, 2017 |
Dec. 30, 2017 |
|
Tax Adjustments, Settlements, and Unusual Provisions | $ 1.2 | ||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | 1.0 | ||
Effective Income Tax Rate Reconciliation, Repatriation of Foreign Earnings, Amount | $ 0.2 | ||
Effective Income Tax Rate Reconciliation, Percent, Total | 25.60% | 39.00% | |
Domestic Tax Authority [Member] | Internal Revenue Service (IRS) [Member] | |||
Effective Income Tax Rate Reconciliation, Percent, Total | 27.90% | 41.60% | |
Foreign Tax Authority [Member] | Canada Revenue Agency [Member] | |||
Effective Income Tax Rate Reconciliation, Percent, Total | 26.50% | 26.50% | |
Foreign Tax Authority [Member] | Ministry of Finance, Republic of Serbia [Member] | |||
Effective Income Tax Rate Reconciliation, Percent, Total | 14.80% |
Note 16 - Contingencies (Details Textual) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2018
USD ($)
| |
Loss Contingency, Damages Sought, Value | $ 10.0 |
Estimated Litigation Liability | 0.1 |
Loss Contingency, Receivable, Ending Balance | 5.9 |
Loss Contingency, Estimate of Possible Loss | $ 9.3 |
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