Shareholders' Equity

3 Months Ended

Mar. 31, 2018

Equity [Abstract]

Shareholders' Equity

6. Shareholders’ Equity

	Common Stock				($000's omitted except for share data)
															Accumulated
	Number				Capital in										Other			Total
	of shares				excess of		Retained					Treasury			Comprehensive			shareholders'
	issued		Amount		par value		earnings		ESOT			stock			Loss			equity
Balance at December 31, 2017		2,614,506	$	523	$	14,171	$	15,709	$	(662	)	$	(1,544	)	$	(32	)	$	28,165
Net income		-		-		-		331		-			-			-			331
Purchase of treasury shares		-		-		-		-		-			(117	)		-			(117	)
Balance at March  31, 2018		2,614,506	$	523	$	14,171	$	16,040	$	(662	)	$	(1,661	)	$	(32	)	$	28,379

The Company’s Board of Directors authorized the purchase of up to 450,000 shares of its common stock in the open market or in privately negotiated transactions. As of March 31, 2018, the Company has purchased 349,330 shares and there remains 100,670 shares available to purchase under this program. There were no shares purchased by the Company during the three month period ended March 31, 2018.

On January 1, 2018, 28,500 shares of restricted stock vested of which 11,341 shares were withheld by the Company for approximately $117,000 to satisfy statutory minimum withholding tax requirements for those participants who elected this option as permitted under the Company’s 2012 Long-Term Incentive Plan. Additionally, upon the death of Servotronics’ Chairman of the Board and Chief Executive Officer (CEO), 15,000 restricted shares awarded to the Chairman and CEO vested.

On April 18, 2013, the Company issued 165,000 shares of restricted stock to Executive Officers of the Company under the Company's 2012 Long-Term Incentive Plan that was approved by the shareholders at the 2012 Annual Meeting of Shareholders. This plan authorizes the issuance of up to 300,000 shares. The restricted share awards vested over a four year period between January 2014 and January 2017; however, these shares had voting rights and accrued dividends prior to vesting. The aggregate amount of expense to the Company, measured based on grant date fair value ($1,336,500) was recognized over the four year requisite service period.

On April 11, 2016, the Company issued 51,000 shares of restricted stock to Executive Officers and certain key management of the Company under the Company’s 2012 Long-Term Incentive Plan. The restricted share awards had varying vesting periods between January 2017 and January 2018; however, these shares had voting rights and accrued dividends prior to vesting. The aggregate amount of expense to the Company, measured based on grant date fair value ($406,000) and was recognized over the requisite service period.

There was no stock-based compensation expense included in the three months ended March 31, 2018 and approximately $53,000 of stock-based compensation expense included in the three months ended March 31, 2017 related to the restrictive share awards.

Earnings Per Share

Basic earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period. The weighted average number of common shares outstanding does not include any potentially dilutive securities or any unvested restricted shares of common stock. These unvested restricted shares, although classified as issued and outstanding, are considered forfeitable until the restrictions lapse and will not be included in the basic EPS calculation until the shares are vested. Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares outstanding during the period plus the number of shares of common stock that would be issued assuming all contingently issuable shares having a dilutive effect on the earnings per share that were outstanding for the period. Incremental shares from assumed conversions are calculated as the number of shares that would be issued, net of the number of shares that could be purchased in the marketplace with the cash received upon stock option exercise. The dilutive effect of unvested restrictive stock is determined using the treasury stock method.

	Three Months Ended
	March 31,
	2018		2017
	($000's omitted except per share data)
Net Income	$	331	$	26
Weighted average common shares outstanding (basic)		2,297		2,251
Unvested restricted stock		-		44
Weighted average common shares outstanding (diluted)		2,297		2,295
Basic
Net income per share	$	0.14	$	0.01
Diluted
Net income per share	$	0.14	$	0.01