Perceptron, Inc. (the “Company”) develops, produces and sells a comprehensive range of automated industrial metrology products and solutions to manufacturers for dimensional gauging, dimensional inspection and 3D scanning. The Company’s products provide solutions for manufacturing process control as well as sensor and software technologies for non-contact measurement, scanning and inspection applications. The Company also offers value added services such as training and customer support.

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information and within the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements. The Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. In the Company’s opinion, these statements include all normal recurring adjustments necessary for a fair presentation of the financial statements for the periods presented. The results of operations for any interim period are not necessarily indicative of the results of operations for a full fiscal year. The accompanying unaudited Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements in the Company’s 2019 Annual Report on Form 10-K for the fiscal year ended June 30, 2019.

Management is required to make certain estimates and assumptions under U.S. GAAP during the preparation of these Consolidated Financial Statements. These estimates and assumptions may affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

During the fourth quarter of fiscal 2019, an error was identified related to the accounting for the Company’s deferred tax liabilities associated with certain amortizable intangible assets acquired in 2015. The error related to not appropriately reducing the associated deferred tax liabilities for the tax effect of amortization on the intangible assets since 2016. The error was immaterial to the Company’s previously issued financial statements, but the cumulative correction would have had a material effect on the 2019 financial statements. Accordingly, the results for the three and six months ended December 31, 2018 and three and six months ended December 31, 2017 have been adjusted to incorporate the revised amounts, where applicable. See Note 1, of the Notes to the Consolidated Financial Statements, “Summary of Significant Accounting Policies - Revision of Previously Issued Financial Statements” contained in Item 8 of the Company’s Annual Report on Form 10-K for further discussion

	Three Months Ended December 31, 2018							Three Months Ended December 31, 2017
	(In Thousands Except Per Share Amounts)							(In Thousands Except Per Share Amounts)

	As Previously					As		As Previously					As
	Reported			Adjustment		Revised		Reported			Adjustment		Revised

Net Sales	$	21,553		$	-	$	21,553	$	20,433		$	-	$	20,433
Cost of Sales		13,703			-		13,703		13,026			-		13,026
Gross Profit		7,850			-		7,850		7,407			-		7,407

Operating Expenses		6,413			-		6,413		6,952			-		6,952

Operating Income		1,437			-		1,437		455			-		455

Other Income and (Expense)		127			-		127		(104	)		-		(104	)

Income Before Income Taxes		1,564			-		1,564		351			-		351

Income Tax Benefit (Expense)		(17	)		62		45		15			62		77

Net Income	$	1,547		$	62	$	1,609	$	366		$	62	$	428

Income Per Common Share
Basic	$	0.16		$	0.01	$	0.17	$	0.04		$	0.01	$	0.05
Diluted	$	0.16		$	-	$	0.16	$	0.04			-	$	0.04

Weighted Average Common Shares Outstanding
Basic		9,615			-		9,615		9,491			-		9,491
Dilutive effect of stock options		76			-		76		106			-		106
Diluted		9,691			-		9,691		9,597			-		9,597

As a result of the above revision, Total Comprehensive Income was increased from $1,178 to $1,240 for the three months ended December 31, 2018.

The consolidated statements of cash flow are not presented because there is no impact on total cash flows from operating activities, investing activities, and financing activities. Certain components of net cash provided by operating activities changed, as caused by the revision, but the net change amounted to zero for the three months ended December 31, 2018.

As a result of the above revision, in the consolidated statement of shareholder’s equity, net income was increased from $1,547 to $1,609 for the three months ended December 31, 2018; accumulated other comprehensive loss was decreased from $2,864 to $2,862 at December 31, 2018 and retained earnings was increased from $3,978 to $5,179 at December 31, 2018.

	Six Months Ended December 31, 2018								Six Months Ended December 31, 2017
	(In Thousands Except Per Share Amounts)								(In Thousands Except Per Share Amounts)

	As Previously					As			As Previously					As
	Reported			Adjustment		Revised			Reported			Adjustment		Revised

Net Sales	$	42,995		$	-	$	42,995		$	39,702		$	-	$	39,702
Cost of Sales		26,853			-		26,853			24,645			-		24,645
Gross Profit		16,142			-		16,142			15,057			-		15,057

Operating Expenses		13,246			-		13,246			13,057			-		13,057

Operating Income		2,896			-		2,896			2,000			-		2,000

Other Income and (Expense)		(102	)		-		(102	)		(138	)		-		(138	)

Income Before Income Taxes		2,794			-		2,794			1,862			-		1,862

Income Tax Benefit (Expense)		(355	)		124		(231	)		62			124		186

Net Income	$	2,439		$	124	$	2,563		$	1,924		$	124	$	2,048

Income Per Common Share
Basic	$	0.25		$	0.02	$	0.27		$	0.20		$	0.02	$	0.22
Diluted	$	0.25		$	0.01	$	0.26		$	0.20		$	0.01	$	0.21

Weighted Average Common Shares Outstanding
Basic		9,588			-		9,588			9,455			-		9,455
Dilutive effect of stock options		143			-		143			72			-		72
Diluted		9,731			-		9,731			9,527			-		9,527

As a result of the above revision, Total Comprehensive Income was increased from $1,673 to $1,797 for the six months ended December 31, 2018.

As a result of the above revision, in the consolidated statement of shareholder’s equity, net income was increased from $2,439 to $2,563 for the six months ended December 31, 2018; accumulated other comprehensive loss was decreased from $2,864 to $2,862 at December 31, 2018 and retained earnings was increased from $3,978 to $5,179 at December 31, 2018.