2019 Q1 Form 10-Q Financial Statement

#000008042019000013 Filed on May 08, 2019

View on sec.gov

Income Statement

Concept 2019 Q1 2018 Q1
Revenue $123.7M $101.5M
YoY Change 21.9% -3.03%
Cost Of Revenue $103.7M $89.08M
YoY Change 16.36% 0.25%
Gross Profit $20.08M $12.42M
YoY Change 61.62% -21.5%
Gross Profit Margin 16.22% 12.24%
Selling, General & Admin $17.20M $16.07M
YoY Change 6.98% 0.49%
% of Gross Profit 85.65% 129.4%
Research & Development $1.663M $1.636M
YoY Change 1.65% 0.8%
% of Gross Profit 8.28% 13.17%
Depreciation & Amortization $3.300M $3.200M
YoY Change 3.13% 3.23%
% of Gross Profit 16.44% 25.76%
Operating Expenses $18.86M $17.71M
YoY Change 6.49% 0.52%
Operating Profit $1.173M -$5.332M
YoY Change -122.0% 95.81%
Interest Expense $55.00K $51.00K
YoY Change 7.84% 8.51%
% of Operating Profit 4.69%
Other Income/Expense, Net $0.00 $0.00
YoY Change -100.0%
Pretax Income $1.363M -$5.090M
YoY Change -126.78% 134.13%
Income Tax $405.0K -$1.760M
% Of Pretax Income 29.71%
Net Earnings $958.0K -$3.330M
YoY Change -128.77% 301.69%
Net Earnings / Revenue 0.77% -3.28%
Basic Earnings Per Share $0.08 -$0.29
Diluted Earnings Per Share $0.08 -$0.29
COMMON SHARES
Basic Shares Outstanding 11.57M shares 11.51M shares
Diluted Shares Outstanding 11.63M shares 11.51M shares

Balance Sheet

Concept 2019 Q1 2018 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $72.40M $69.20M
YoY Change 4.62% -36.1%
Cash & Equivalents $66.38M $48.24M
Short-Term Investments $6.000M $20.90M
Other Short-Term Assets $2.068M $274.0K
YoY Change 654.74% -90.33%
Inventory $24.72M $22.01M
Prepaid Expenses $2.275M $1.760M
Receivables $81.27M $68.07M
Other Receivables $100.0K $7.700M
Total Short-Term Assets $264.4M $235.9M
YoY Change 12.06% -11.31%
LONG-TERM ASSETS
Property, Plant & Equipment $122.8M $134.7M
YoY Change -8.79% -3.4%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $10.91M $13.59M
YoY Change -19.7% 7.37%
Total Long-Term Assets $149.2M $164.2M
YoY Change -9.12% 6.67%
TOTAL ASSETS
Total Short-Term Assets $264.4M $235.9M
Total Long-Term Assets $149.2M $164.2M
Total Assets $413.6M $400.1M
YoY Change 3.37% -4.72%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $33.57M $35.21M
YoY Change -4.67% 27.24%
Accrued Expenses $15.20M $14.30M
YoY Change 6.29% -12.8%
Deferred Revenue $51.09M
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due $400.0K $400.0K
YoY Change 0.0% 0.0%
Total Short-Term Liabilities $110.3M $85.71M
YoY Change 28.67% 2.14%
LONG-TERM LIABILITIES
Long-Term Debt $800.0K $1.200M
YoY Change -33.33% -25.0%
Other Long-Term Liabilities $3.880M $1.238M
YoY Change 213.41% -18.01%
Total Long-Term Liabilities $4.680M $2.438M
YoY Change 91.96% -21.61%
TOTAL LIABILITIES
Total Short-Term Liabilities $110.3M $85.71M
Total Long-Term Liabilities $4.680M $2.438M
Total Liabilities $121.3M $93.75M
YoY Change 29.4% 1.89%
SHAREHOLDERS EQUITY
Retained Earnings $283.8M $295.7M
YoY Change -4.01% -9.0%
Common Stock $57.51M $55.96M
YoY Change 2.78% 4.74%
Preferred Stock
YoY Change
Treasury Stock (at cost) $25.00M $25.00M
YoY Change 0.0% 0.0%
Treasury Stock Shares 806.0K shares 806.0K shares
Shareholders Equity $292.3M $306.4M
YoY Change
Total Liabilities & Shareholders Equity $413.6M $400.1M
YoY Change 3.37% -4.72%

Cashflow Statement

Concept 2019 Q1 2018 Q1
OPERATING ACTIVITIES
Net Income $958.0K -$3.330M
YoY Change -128.77% 301.69%
Depreciation, Depletion And Amortization $3.300M $3.200M
YoY Change 3.13% 3.23%
Cash From Operating Activities $16.90M $3.500M
YoY Change 382.86% -78.53%
INVESTING ACTIVITIES
Capital Expenditures -$1.200M -$1.100M
YoY Change 9.09% 37.5%
Acquisitions
YoY Change
Other Investing Activities $1.400M $1.500M
YoY Change -6.67%
Cash From Investing Activities $300.0K $400.0K
YoY Change -25.0% -150.0%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -3.400M -3.000M
YoY Change 13.33% 3.45%
NET CHANGE
Cash From Operating Activities 16.90M 3.500M
Cash From Investing Activities 300.0K 400.0K
Cash From Financing Activities -3.400M -3.000M
Net Change In Cash 13.80M 900.0K
YoY Change 1433.33% -92.86%
FREE CASH FLOW
Cash From Operating Activities $16.90M $3.500M
Capital Expenditures -$1.200M -$1.100M
Free Cash Flow $18.10M $4.600M
YoY Change 293.48% -73.1%

Facts In Submission

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402000 USD
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LongTermDebt
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LongTermDebt
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LongTermDebtAndCapitalLeaseObligations
1200000 USD
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LongTermDebtAndCapitalLeaseObligations
800000 USD
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LongTermDebtAndCapitalLeaseObligationsCurrent
400000 USD
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LongTermDebtAndCapitalLeaseObligationsCurrent
400000 USD
CY2018Q3 us-gaap Long Term Debt Current
LongTermDebtCurrent
400000 USD
CY2019Q1 us-gaap Long Term Debt Current
LongTermDebtCurrent
400000 USD
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LongTermDebtNoncurrent
1200000 USD
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LongTermDebtNoncurrent
800000 USD
us-gaap Net Cash Provided By Used In Financing Activities
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-6792000 USD
us-gaap Net Cash Provided By Used In Financing Activities
NetCashProvidedByUsedInFinancingActivities
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us-gaap Net Cash Provided By Used In Investing Activities
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2547000 USD
us-gaap Net Cash Provided By Used In Investing Activities
NetCashProvidedByUsedInInvestingActivities
5256000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
-10607000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
26047000 USD
CY2017Q4 us-gaap Net Income Loss
NetIncomeLoss
-5662000 USD
CY2018Q1 us-gaap Net Income Loss
NetIncomeLoss
-3330000 USD
us-gaap Net Income Loss
NetIncomeLoss
-8992000 USD
CY2018Q4 us-gaap Net Income Loss
NetIncomeLoss
-2695000 USD
CY2019Q1 us-gaap Net Income Loss
NetIncomeLoss
958000 USD
us-gaap Net Income Loss
NetIncomeLoss
-1737000 USD
CY2018Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
-5332000 USD
us-gaap Operating Income Loss
OperatingIncomeLoss
-12723000 USD
CY2019Q1 us-gaap Operating Income Loss
OperatingIncomeLoss
1173000 USD
us-gaap Operating Income Loss
OperatingIncomeLoss
-1862000 USD
CY2018Q3 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
7786000 USD
CY2019Q1 us-gaap Other Accrued Liabilities Current
OtherAccruedLiabilitiesCurrent
9710000 USD
CY2018Q3 us-gaap Other Assets Current
OtherAssetsCurrent
630000 USD
CY2019Q1 us-gaap Other Assets Current
OtherAssetsCurrent
2068000 USD
CY2018Q3 us-gaap Other Assets Fair Value Disclosure
OtherAssetsFairValueDisclosure
6817000 USD
CY2019Q1 us-gaap Other Assets Fair Value Disclosure
OtherAssetsFairValueDisclosure
6621000 USD
CY2018Q3 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
11087000 USD
CY2019Q1 us-gaap Other Assets Noncurrent
OtherAssetsNoncurrent
10909000 USD
CY2017Q4 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-314000 USD
CY2018Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-1275000 USD
us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-1589000 USD
CY2018Q4 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-4088000 USD
CY2019Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
1720000 USD
us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
-2368000 USD
CY2018Q3 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
3356000 USD
CY2019Q1 us-gaap Other Liabilities Noncurrent
OtherLiabilitiesNoncurrent
3880000 USD
CY2018Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
0 USD
us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
507000 USD
CY2019Q1 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
0 USD
us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
0 USD
us-gaap Payments Of Dividends Common Stock
PaymentsOfDividendsCommonStock
5954000 USD
us-gaap Payments Of Dividends Common Stock
PaymentsOfDividendsCommonStock
5988000 USD
us-gaap Payments Related To Tax Withholding For Share Based Compensation
PaymentsRelatedToTaxWithholdingForShareBasedCompensation
438000 USD
us-gaap Payments Related To Tax Withholding For Share Based Compensation
PaymentsRelatedToTaxWithholdingForShareBasedCompensation
1147000 USD
us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
2760000 USD
us-gaap Payments To Acquire Property Plant And Equipment
PaymentsToAcquirePropertyPlantAndEquipment
1963000 USD
us-gaap Payments To Acquire Short Term Investments
PaymentsToAcquireShortTermInvestments
20712000 USD
us-gaap Payments To Acquire Short Term Investments
PaymentsToAcquireShortTermInvestments
5869000 USD
CY2018Q3 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.01
CY2019Q1 us-gaap Preferred Stock Par Or Stated Value Per Share
PreferredStockParOrStatedValuePerShare
0.01
CY2018Q3 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2019Q1 us-gaap Preferred Stock Shares Authorized
PreferredStockSharesAuthorized
5000000 shares
CY2018Q3 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0 shares
CY2019Q1 us-gaap Preferred Stock Shares Issued
PreferredStockSharesIssued
0 shares
CY2018Q3 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2019Q1 us-gaap Preferred Stock Value
PreferredStockValue
0 USD
CY2018Q3 us-gaap Prepaid Expense Current
PrepaidExpenseCurrent
3775000 USD
CY2019Q1 us-gaap Prepaid Expense Current
PrepaidExpenseCurrent
2275000 USD
us-gaap Proceeds From Maturities Prepayments And Calls Of Shortterm Investments
ProceedsFromMaturitiesPrepaymentsAndCallsOfShorttermInvestments
26019000 USD
us-gaap Proceeds From Maturities Prepayments And Calls Of Shortterm Investments
ProceedsFromMaturitiesPrepaymentsAndCallsOfShorttermInvestments
13088000 USD
CY2017Q3 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
3174000 USD
CY2017Q4 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
2890000 USD
CY2018Q1 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
2241000 USD
CY2018Q3 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
2604000 USD
CY2018Q4 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
2732000 USD
CY2019Q1 us-gaap Product Warranty Accrual Classified Current
ProductWarrantyAccrualClassifiedCurrent
2986000 USD
CY2018Q1 us-gaap Product Warranty Accrual Payments
ProductWarrantyAccrualPayments
383000 USD
us-gaap Product Warranty Accrual Payments
ProductWarrantyAccrualPayments
861000 USD
CY2019Q1 us-gaap Product Warranty Accrual Payments
ProductWarrantyAccrualPayments
634000 USD
us-gaap Product Warranty Accrual Payments
ProductWarrantyAccrualPayments
1238000 USD
CY2018Q1 us-gaap Product Warranty Accrual Period Increase Decrease
ProductWarrantyAccrualPeriodIncreaseDecrease
-261000 USD
us-gaap Product Warranty Accrual Period Increase Decrease
ProductWarrantyAccrualPeriodIncreaseDecrease
-66000 USD
CY2019Q1 us-gaap Product Warranty Accrual Period Increase Decrease
ProductWarrantyAccrualPeriodIncreaseDecrease
881000 USD
us-gaap Product Warranty Accrual Period Increase Decrease
ProductWarrantyAccrualPeriodIncreaseDecrease
1627000 USD
CY2018Q3 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
128764000 USD
CY2019Q1 us-gaap Property Plant And Equipment Net
PropertyPlantAndEquipmentNet
122836000 USD
CY2018Q1 us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
112000 USD
us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
92000 USD
CY2019Q1 us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
74000 USD
us-gaap Provision For Doubtful Accounts
ProvisionForDoubtfulAccounts
101000 USD
us-gaap Repayments Of Long Term Debt
RepaymentsOfLongTermDebt
400000 USD
us-gaap Repayments Of Long Term Debt
RepaymentsOfLongTermDebt
400000 USD
CY2018Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
1636000 USD
us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
3294000 USD
CY2019Q1 us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
1663000 USD
us-gaap Research And Development Expense
ResearchAndDevelopmentExpense
3357000 USD
CY2018Q3 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
RestrictedCashAndCashEquivalentsAtCarryingValue
19154000 USD
CY2019Q1 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
RestrictedCashAndCashEquivalentsAtCarryingValue
10835000 USD
CY2018Q3 us-gaap Restricted Cash And Cash Equivalents Noncurrent
RestrictedCashAndCashEquivalentsNoncurrent
5987000 USD
CY2019Q1 us-gaap Restricted Cash And Cash Equivalents Noncurrent
RestrictedCashAndCashEquivalentsNoncurrent
7791000 USD
CY2018Q3 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
291530000 USD
CY2019Q1 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
283805000 USD
CY2018Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
101505000 USD
us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
191689000 USD
CY2019Q1 us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
123737000 USD
us-gaap Revenue From Contract With Customer Excluding Assessed Tax
RevenueFromContractWithCustomerExcludingAssessedTax
233088000 USD
CY2019Q1 us-gaap Revenue Remaining Performance Obligation
RevenueRemainingPerformanceObligation
397200000 USD
CY2019Q1 us-gaap Revenue Remaining Performance Obligation
RevenueRemainingPerformanceObligation
334700000 USD
CY2019Q1 us-gaap Revenue Remaining Performance Obligation Expected Timing Of Satisfaction Period1
RevenueRemainingPerformanceObligationExpectedTimingOfSatisfactionPeriod1
P1Y
CY2018Q1 us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
16073000 USD
us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
32288000 USD
CY2019Q1 us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
17195000 USD
us-gaap Selling General And Administrative Expense
SellingGeneralAndAdministrativeExpense
33123000 USD
us-gaap Share Based Compensation
ShareBasedCompensation
2067000 USD
us-gaap Share Based Compensation
ShareBasedCompensation
1890000 USD
us-gaap Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Forfeited In Period
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsForfeitedInPeriod
10750 shares
us-gaap Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Forfeitures Weighted Average Grant Date Fair Value
ShareBasedCompensationArrangementByShareBasedPaymentAwardEquityInstrumentsOtherThanOptionsForfeituresWeightedAverageGrantDateFairValue
34.27
CY2018Q3 us-gaap Short Term Investments
ShortTermInvestments
13170000 USD
CY2019Q1 us-gaap Short Term Investments
ShortTermInvestments
5991000 USD
CY2018Q1 us-gaap Standard And Extended Product Warranty Accrual Foreign Currency Translation Gain Loss
StandardAndExtendedProductWarrantyAccrualForeignCurrencyTranslationGainLoss
5000 USD
us-gaap Standard And Extended Product Warranty Accrual Foreign Currency Translation Gain Loss
StandardAndExtendedProductWarrantyAccrualForeignCurrencyTranslationGainLoss
6000 USD
CY2019Q1 us-gaap Standard And Extended Product Warranty Accrual Foreign Currency Translation Gain Loss
StandardAndExtendedProductWarrantyAccrualForeignCurrencyTranslationGainLoss
-7000 USD
us-gaap Standard And Extended Product Warranty Accrual Foreign Currency Translation Gain Loss
StandardAndExtendedProductWarrantyAccrualForeignCurrencyTranslationGainLoss
7000 USD
CY2018Q1 us-gaap Stock Issued During Period Value Restricted Stock Award Net Of Forfeitures
StockIssuedDuringPeriodValueRestrictedStockAwardNetOfForfeitures
1000 USD
CY2017Q4 us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
1069000 USD
CY2018Q1 us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
998000 USD
CY2018Q4 us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
1220000 USD
CY2019Q1 us-gaap Stock Issued During Period Value Share Based Compensation
StockIssuedDuringPeriodValueShareBasedCompensation
670000 USD
CY2017Q3 us-gaap Stockholders Equity
StockholdersEquity
321296000 USD
CY2017Q4 us-gaap Stockholders Equity
StockholdersEquity
312974000 USD
CY2018Q1 us-gaap Stockholders Equity
StockholdersEquity
306392000 USD
CY2018Q3 us-gaap Stockholders Equity
StockholdersEquity
301644000 USD
CY2018Q4 us-gaap Stockholders Equity
StockholdersEquity
292358000 USD
CY2019Q1 us-gaap Stockholders Equity
StockholdersEquity
292294000 USD
CY2018Q3 us-gaap Treasury Stock Shares
TreasuryStockShares
806018 shares
CY2019Q1 us-gaap Treasury Stock Shares
TreasuryStockShares
806018 shares
CY2018Q3 us-gaap Treasury Stock Value
TreasuryStockValue
24999000 USD
CY2019Q1 us-gaap Treasury Stock Value
TreasuryStockValue
24999000 USD
CY2018Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
11509000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
11503000 shares
CY2019Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
11632000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
11560000 shares
CY2018Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
11509000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
11503000 shares
CY2019Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
11570000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
11560000 shares
us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:24px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Use of Estimates</font></div><div style="line-height:120%;padding-top:8px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of condensed consolidated financial statements in conformity with U.S.&#160;GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying footnotes. The most significant estimates used in our condensed consolidated financial statements affect revenue recognition and estimated cost recognition on our customer contracts, the allowance for doubtful accounts, provision for excess and obsolete inventory, warranty accruals and income taxes. The amounts recorded for warranties, legal, income taxes, impairment of long-lived assets (when applicable) and other contingent liabilities require judgments regarding the amount of expenses that will ultimately be incurred. We base our estimates on historical experience and on various other assumptions, as well as the specific circumstances surrounding these contingent liabilities, in evaluating the amount of liability that should be recorded. Additionally, the recognition of deferred tax assets requires estimates related to future income and other assumptions regarding timing and future profitability because the ultimate realization of net deferred tax assets is dependent on the generation of future taxable income during the periods in which temporary differences become deductible. Estimates routinely change as new events occur, additional information becomes available or operating environments change. Actual results may differ from our prior estimates.</font></div></div>

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