Note 5 - Trade Accounts and Financing Receivables

3 Months Ended

Dec. 31, 2024

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

5. Trade Accounts and Financing Receivables

Trade accounts receivable, net (excluding financing receivables) are reflected in the following table (in thousands):

	December 31, 2024			September 30, 2024
Trade accounts receivable	$	19,510		$	16,151
Allowance for credit losses		(4	)		(4	)
Total		19,506			16,147
Less current portion		(19,506	)		(14,637	)
Non-current trade accounts receivable	$	—		$	1,510

The Company determines the allowance for credit losses through a review of several factors, including historical collection experience, customer credit worthiness, current aging of customer accounts and current financial conditions of its customers. Trade accounts receivable balances are charged off against the allowance whenever it is probable that the receivable balance will not be recoverable.

Allowance for credit losses related to trade accounts receivable are reflected in the following table (in thousands):

	Three Months Ended
	December 31, 2024		December 31, 2023
Allowance for credit losses:
Beginning of period		4		125
Provision for credit losses		—		43
Recoveries		—		(72	)
Write-offs		—		(7	)
Currency translation		—		3
End of period	$	4	$	92

In November 2024, the Company entered into a sales-type lease with a customer on wireless seismic equipment from its rental fleet.  The lease matures in October 2025.  Future minimum payments required under the lease at December 31, 2024, were $16.7 including $0.6 million of unearned income.  Interest income of $0.1 million was recognized for the three months ended December 31, 2024.  The ownership of the equipment will transfer to the customer at the end of the lease term.

In August 2024, the Company entered into a $9.4 million promissory note with a customer related to a product sale.  The note bears interest at 9.5% per annum.  Pursuant to an amendment in the first quarter of fiscal year 2025, the maturity of the note was extended from December 2025 to June 2026.  The note bears interest at 9.5% per annum. The note is collateralized by the product sold.  

In August 2024, the Company entered into a $3.5 million promissory note with the buyer of its Russian subsidiary.  The note bears interest at 5% per annum and is for a 10-year term.  Principal and interest payments of $37,000 are due monthly.  Based on a fair value analysis performed at the date of sale, a discount to fair value of $0.9 million was placed on the note.  Interest income on the amortization of the discount is being recognized under the effective interest method.

Credit quality indicators used for the financing receivables consisted of historical collection experience, internal credit risk grades and collateral.  The Company determined the allowance for credit losses through a review of several factors, including historical collection experience, customer credit worthiness, current aging of customer accounts and current financial conditions of its customers.