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 |
Wisconsin | 39-1847269 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification number) |
2210 Woodland Drive, Manitowoc, Wisconsin | 54220 | |
(Address of principal executive offices) | (Zip code) |
Large accelerated filer | o | Accelerated filer | o |
Non-accelerated filer | o (Do not check if a smaller reporting company) | Smaller reporting company | ý |
Emerging growth company | o | ||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
Page(s) | ||
ITEM 1. | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 1. | ||
ITEM 1A. | ||
ITEM 2. | ||
ITEM 5. | ||
ITEM 6. | ||
Exhibit 31.1 | ||
Exhibit 31.2 | ||
Exhibit 32.1 | ||
Exhibit 32.2 | ||
EX-101 INSTANCE DOCUMENT | ||
EX-101 SCHEMA DOCUMENT | ||
EX-101 CALCULATION LINKBASE DOCUMENT | ||
EX-101 LABELS LINKBASE DOCUMENT | ||
EX-101 PRESENTATION LINKBASE DOCUMENT |
June 30, 2017 | March 31, 2017 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 8,485 | $ | 17,307 | |||
Accounts receivable, net | 7,040 | 9,171 | |||||
Inventories, net | 12,266 | 13,593 | |||||
Deferred contract costs | 1,704 | 935 | |||||
Prepaid expenses and other current assets | 3,093 | 2,877 | |||||
Total current assets | 32,588 | 43,883 | |||||
Property and equipment, net | 13,638 | 13,786 | |||||
Other intangible assets, net | 4,065 | 4,207 | |||||
Other long-term assets | 118 | 175 | |||||
Total assets | $ | 50,409 | $ | 62,051 | |||
Liabilities and Shareholders’ Equity | |||||||
Accounts payable | $ | 9,608 | $ | 11,635 | |||
Accrued expenses and other | 5,128 | 5,988 | |||||
Deferred revenue, current | 823 | 621 | |||||
Current maturities of long-term debt | 110 | 152 | |||||
Total current liabilities | 15,669 | 18,396 | |||||
Revolving credit facility | 3,853 | 6,629 | |||||
Long-term debt, less current maturities | 164 | 190 | |||||
Deferred revenue, long-term | 945 | 944 | |||||
Other long-term liabilities | 560 | 442 | |||||
Total liabilities | 21,191 | 26,601 | |||||
Commitments and contingencies | |||||||
Shareholders’ equity: | |||||||
Preferred stock, $0.01 par value: Shares authorized: 30,000,000 at June 30, 2017 and March 31, 2017; no shares issued and outstanding at June 30, 2017 and March 31, 2017 | — | — | |||||
Common stock, no par value: Shares authorized: 200,000,000 at June 30, 2017 and March 31, 2017; shares issued: 38,161,796 at June 30, 2017 and 37,747,227 at March 31, 2017; shares outstanding: 28,732,979 at June 30, 2017 and 28,317,490 at March 31, 2017 | — | — | |||||
Additional paid-in capital | 154,230 | 153,901 | |||||
Treasury stock, common shares: 9,428,817 at June 30, 2017 and 9,429,737 at March 31, 2017 | (36,082 | ) | (36,081 | ) | |||
Shareholder notes receivable | — | (4 | ) | ||||
Retained deficit | (88,930 | ) | (82,366 | ) | |||
Total shareholders’ equity | 29,218 | 35,450 | |||||
Total liabilities and shareholders’ equity | $ | 50,409 | $ | 62,051 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Product revenue | $ | 11,781 | $ | 15,352 | |||
Service revenue | 777 | 282 | |||||
Total revenue | 12,558 | 15,634 | |||||
Cost of product revenue | 8,813 | 11,419 | |||||
Cost of service revenue | 1,034 | 189 | |||||
Total cost of revenue | 9,847 | 11,608 | |||||
Gross profit | 2,711 | 4,026 | |||||
Operating expenses: | |||||||
General and administrative | 5,335 | 3,901 | |||||
Sales and marketing | 3,354 | 2,895 | |||||
Research and development | 524 | 481 | |||||
Total operating expenses | 9,213 | 7,277 | |||||
Loss from operations | (6,502 | ) | (3,251 | ) | |||
Other income (expense): | |||||||
Other income | — | 100 | |||||
Interest expense | (67 | ) | (70 | ) | |||
Interest income | 5 | 10 | |||||
Total other (expense) income | (62 | ) | 40 | ||||
Loss before income tax | (6,564 | ) | (3,211 | ) | |||
Income tax benefit | — | (271 | ) | ||||
Net loss | $ | (6,564 | ) | $ | (2,940 | ) | |
Basic net loss per share attributable to common shareholders | $ | (0.23 | ) | $ | (0.11 | ) | |
Weighted-average common shares outstanding | 28,455,434 | 27,885,588 | |||||
Diluted net loss per share | $ | (0.23 | ) | $ | (0.11 | ) | |
Weighted-average common shares and share equivalents outstanding | 28,455,434 | 27,885,588 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Operating activities | |||||||
Net loss | $ | (6,564 | ) | $ | (2,940 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation | 353 | 389 | |||||
Amortization | 162 | 243 | |||||
Stock-based compensation | 320 | 329 | |||||
Provision for inventory reserves | 130 | 254 | |||||
Provision for bad debts | 33 | (375 | ) | ||||
Other | 12 | 56 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable, current and long-term | 2,103 | (1,805 | ) | ||||
Inventories | 1,196 | 1,280 | |||||
Deferred contract costs | (770 | ) | (200 | ) | |||
Prepaid expenses and other assets | (163 | ) | 2,203 | ||||
Accounts payable | (2,028 | ) | (1,516 | ) | |||
Accrued expenses and other | (743 | ) | (285 | ) | |||
Deferred revenue, current and long-term | 204 | 52 | |||||
Net cash used in operating activities | (5,755 | ) | (2,315 | ) | |||
Investing activities | |||||||
Purchase of property and equipment | (204 | ) | (53 | ) | |||
Additions to patents and licenses | (20 | ) | — | ||||
Proceeds from sales of property, plant and equipment | — | 2,600 | |||||
Net cash (used in) provided by investing activities | (224 | ) | 2,547 | ||||
Financing activities | |||||||
Payment of long-term debt and capital leases | (67 | ) | (381 | ) | |||
Proceeds from revolving credit facility | 16,307 | 16,658 | |||||
Payment of revolving credit facility | (19,083 | ) | (17,889 | ) | |||
Payments to settle employee tax withholdings on stock-based compensation | — | (4 | ) | ||||
Net proceeds from employee equity exercises | — | 2 | |||||
Net cash used in financing activities | (2,843 | ) | (1,614 | ) | |||
Net decrease in cash and cash equivalents | (8,822 | ) | (1,382 | ) | |||
Cash and cash equivalents at beginning of period | 17,307 | 15,542 | |||||
Cash and cash equivalents at end of period | $ | 8,485 | $ | 14,160 |
June 30, 2017 | March 31, 2017 | ||||||
Accounts receivable, gross | $ | 7,216 | $ | 9,315 | |||
Allowance for doubtful accounts | (176 | ) | (144 | ) | |||
Accounts receivable, net | $ | 7,040 | $ | 9,171 |
Cost | Reserve | Net | |||||||||
As of June 30, 2017 | |||||||||||
Raw materials and components | $ | 8,008 | $ | (1,677 | ) | $ | 6,331 | ||||
Work in process | 1,693 | (348 | ) | 1,345 | |||||||
Finished goods | 5,981 | (1,391 | ) | 4,590 | |||||||
Total | $ | 15,682 | $ | (3,416 | ) | $ | 12,266 | ||||
As of March 31, 2017 | |||||||||||
Raw materials and components | $ | 8,104 | $ | (1,807 | ) | $ | 6,297 | ||||
Work in process | 1,918 | (329 | ) | 1,589 | |||||||
Finished goods | 7,044 | (1,337 | ) | 5,707 | |||||||
Total | $ | 17,066 | $ | (3,473 | ) | $ | 13,593 |
June 30, 2017 | March 31, 2017 | ||||||
Unbilled accounts receivable | $ | 2,467 | $ | 2,226 | |||
Other prepaid expenses | 626 | 651 | |||||
Total | $ | 3,093 | $ | 2,877 |
June 30, 2017 | March 31, 2017 | ||||||
Land and land improvements | $ | 424 | $ | 424 | |||
Buildings and building improvements | 9,245 | 9,245 | |||||
Furniture, fixtures and office equipment | 7,050 | 7,056 | |||||
Leasehold improvements | 324 | 324 | |||||
Equipment leased to customers | 4,997 | 4,997 | |||||
Plant equipment | 11,633 | 11,627 | |||||
Construction in progress | 224 | 61 | |||||
33,897 | 33,734 | ||||||
Less: accumulated depreciation and amortization | (20,259 | ) | (19,948 | ) | |||
Property and equipment, net | $ | 13,638 | $ | 13,786 |
June 30, 2017 | March 31, 2017 | ||||||
Equipment | $ | 581 | $ | 581 | |||
Less: accumulated depreciation and amortization | (237 | ) | (202 | ) | |||
Equipment, net | $ | 344 | $ | 379 |
June 30, 2017 | March 31, 2017 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net | Gross Carrying Amount | Accumulated Amortization | Net | ||||||||||||||||||
Patents | $ | 2,678 | $ | (1,251 | ) | $ | 1,427 | $ | 2,658 | $ | (1,211 | ) | $ | 1,447 | |||||||||
Licenses | 58 | (58 | ) | — | 58 | (58 | ) | — | |||||||||||||||
Trade name and trademarks | 1,715 | — | 1,715 | 1,715 | — | 1,715 | |||||||||||||||||
Customer relationships | 3,600 | (3,131 | ) | 469 | 3,600 | (3,054 | ) | 546 | |||||||||||||||
Developed technology | 900 | (466 | ) | 434 | 900 | (426 | ) | 474 | |||||||||||||||
Non-competition agreements | 100 | (80 | ) | 20 | 100 | (75 | ) | 25 | |||||||||||||||
Total | $ | 9,051 | $ | (4,986 | ) | $ | 4,065 | $ | 9,031 | $ | (4,824 | ) | $ | 4,207 |
Fiscal 2018 | $ | 461 | |
Fiscal 2019 | 447 | ||
Fiscal 2020 | 361 | ||
Fiscal 2021 | 287 | ||
Fiscal 2022 | 190 | ||
Fiscal 2023 | 166 | ||
Thereafter | 438 | ||
Total | $ | 2,350 |
June 30, 2017 | March 31, 2017 | ||||||
Security deposits | $ | 66 | $ | 117 | |||
Other | 52 | 58 | |||||
Total | $ | 118 | $ | 175 |
June 30, 2017 | March 31, 2017 | ||||||
Compensation and benefits | $ | 1,802 | $ | 2,431 | |||
Sales tax | 94 | 213 | |||||
Contract costs | 248 | 223 | |||||
Legal and professional fees | 2,116 | 2,262 | |||||
Warranty | 471 | 449 | |||||
Other accruals | 397 | 410 | |||||
Total | $ | 5,128 | $ | 5,988 |
June 30, 2017 | March 31, 2017 | ||||||
Warranty | $ | 310 | $ | 310 | |||
Medical benefits | 137 | — | |||||
Unrecognized tax benefits | 113 | 113 | |||||
Other | — | 19 | |||||
Total | $ | 560 | $ | 442 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Beginning of period | $ | 759 | $ | 864 | |||
Provision to product cost of revenue | 24 | 175 | |||||
Charges | (2 | ) | (1 | ) | |||
End of period | $ | 781 | $ | 1,038 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Numerator: | |||||||
Net loss (in thousands) | $ | (6,564 | ) | $ | (2,940 | ) | |
Denominator: | |||||||
Weighted-average common shares outstanding | 28,455,434 | 27,885,588 | |||||
Weighted-average common shares and common share equivalents outstanding | 28,455,434 | 27,885,588 | |||||
Net loss per common share: | |||||||
Basic | $ | (0.23 | ) | $ | (0.11 | ) | |
Diluted | $ | (0.23 | ) | $ | (0.11 | ) |
June 30, 2017 | June 30, 2016 | ||||
Common stock options | 1,442,153 | 1,949,846 | |||
Restricted shares | 1,706,445 | 1,482,208 | |||
Total | 3,148,598 | 3,432,054 |
June 30, 2017 | March 31, 2017 | ||||||
Revolving credit facility | $ | 3,853 | $ | 6,629 | |||
Equipment lease obligations | 268 | 321 | |||||
Customer equipment finance notes payable | 6 | 7 | |||||
Other long-term debt | — | 14 | |||||
Total long-term debt | 4,127 | 6,971 | |||||
Less current maturities | (110 | ) | (152 | ) | |||
Long-term debt, less current maturities | $ | 4,017 | $ | 6,819 |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Cost of product revenue | $ | 6 | $ | 14 | |||
General and administrative | 267 | 267 | |||||
Sales and marketing | 41 | 31 | |||||
Research and development | 6 | 17 | |||||
Total | $ | 320 | $ | 329 |
Restricted Shares | Stock Options | |||
Balance at March 31, 2017 | 1,704,543 | 1,520,953 | ||
Awards granted | 659,272 | — | ||
Awards vested | (414,569 | ) | — | |
Awards forfeited | (242,801 | ) | (78,800 | ) |
Awards outstanding at June 30, 2017 | 1,706,445 | 1,442,153 | ||
Per share price on grant date | $1.38 - $1.95 | — |
Revenues | Operating Income (Loss) | ||||||||||||||
For the Three Months Ended June 30, | For the Three Months Ended June 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Segments: | |||||||||||||||
Orion U.S. Markets | $ | 1,390 | $ | 5,901 | $ | (1,532 | ) | $ | (57 | ) | |||||
Orion Engineered Systems | 5,408 | 6,800 | (1,891 | ) | (769 | ) | |||||||||
Orion Distribution Services | 5,760 | 2,933 | (741 | ) | (728 | ) | |||||||||
Corporate and Other | — | — | (2,338 | ) | (1,697 | ) | |||||||||
$ | 12,558 | $ | 15,634 | $ | (6,502 | ) | $ | (3,251 | ) |
Three Months Ended | |||
June 30, 2017 | |||
Cost of product revenue | $ | 40 | |
General and administrative | 1,767 | ||
Sales and marketing | 97 | ||
Total | $ | 1,904 |
Three Months Ended | |||
June 30, 2017 | |||
Orion U.S. Markets | $ | — | |
Orion Engineered Systems | — | ||
Orion Distribution Systems | 75 | ||
Corporate and Other | 1,829 | ||
Total | $ | 1,904 |
March 31, 2017 | Additions | Amounts Used | June 30, 2017 | |||||||||
Employee separation costs | $ | — | $ | 1,763 | $ | (1,304 | ) | $ | 459 | |||
Post-employment medical benefits (1) | — | 141 | — | 141 | ||||||||
Total | $ | — | $ | 1,904 | $ | (1,304 | ) | $ | 600 |
(1) | The severance agreement with one executive included a long-term post-employment medical benefit which will be paid over a period of approximately twelve years. The Company recorded a liability for the net present value of this obligation based on the current cost of premiums for this individual’s medical coverage increased by an estimated health care cost trend of 6.8% decreasing to 5% in nine years. This benefit is reflected in Orion’s condensed consolidated balance sheet within accrued expenses and other and other long-term liabilities. |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
• | Rapidly declining LED component costs and LED product end user customer pricing pressure. |
• | Improving LED product performance and reducing customer return on investment payback periods resulting in increased customer preference for LED lighting products compared to legacy lighting products. |
• | Increasing LED lighting product customer sales compared to decreasing HIF product sales. |
• | A broader and more diverse customer base and market opportunities compared to our historical commercial and industrial facility customers. |
• | Increased importance of highly innovative product designs and features and enhanced product research and development capabilities requiring rapid new product introduction and new methods of product and company differentiation. |
• | Significantly reduced product technology life cycles; significantly shorter product inventory shelf lives and the related increased risk of rapidly occurring product technology obsolescence. |
• | Increased reliance on international component sources. |
• | Less internal product fabrication and production capabilities needed to support LED product assembly. |
• | Different and broader types of components, fabrication and assembly processes needed to support LED product assembly compared to our legacy products. |
• | Expanding customer bases and sales channels. |
• | Significantly longer end user product warranty requirements for LED products compared to our legacy products. |
• | Constant monitoring and management of manufacturing overhead costs to ensure we continue to deliver strong gross margins amid an increasingly competitive market landscape; |
• | Reducing staff positions through a targeted reduction in existing headcount; |
• | Reductions in the total compensation of our executive management and board of directors; |
• | Reductions in operating expenses, including better control of legal spending, elimination of our racing program and removal of various non-critical back office programs and initiatives. |
Three Months Ended | |||
June 30, 2017 | |||
Orion U.S. Markets | $ | — | |
Orion Engineered Systems | — | ||
Orion Distribution Systems | 75 | ||
Corporate and Other | 1,829 | ||
Total | $ | 1,904 |
• | LED adoption continues to grow in all sectors; |
• | Commercial and industrial economic sentiment is strengthening; |
• | Utility incentives continue to be available and are increasing as a percent of project costs in many areas; |
• | Prospects of tax regulatory reform are encouraging; |
• | Capital spending is increasing; |
• | Business profits are increasing; and |
• | Consumer spending remains strong. |
Three Months Ended June 30, | ||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Amount | Amount | % Change | % of Revenue | % of Revenue | ||||||||||||
Product revenue | $ | 11,781 | $ | 15,352 | (23.3 | )% | 93.8 | % | 98.2 | % | ||||||
Service revenue | 777 | 282 | 175.5 | % | 6.2 | % | 1.8 | % | ||||||||
Total revenue | 12,558 | 15,634 | (19.7 | )% | 100.0 | % | 100.0 | % | ||||||||
Cost of product revenue | 8,813 | 11,419 | (22.8 | )% | 70.2 | % | 73.0 | % | ||||||||
Cost of service revenue | 1,034 | 189 | 447.1 | % | 8.2 | % | 1.2 | % | ||||||||
Total cost of revenue | 9,847 | 11,608 | (15.2 | )% | 78.4 | % | 74.2 | % | ||||||||
Gross profit | 2,711 | 4,026 | (32.7 | )% | 21.6 | % | 25.8 | % | ||||||||
General and administrative expenses | 5,335 | 3,901 | 36.8 | % | 42.5 | % | 25.0 | % | ||||||||
Sales and marketing expenses | 3,354 | 2,895 | 15.9 | % | 26.7 | % | 18.5 | % | ||||||||
Research and development expenses | 524 | 481 | 8.9 | % | 4.2 | % | 3.1 | % | ||||||||
Loss from operations | (6,502 | ) | (3,251 | ) | (100.0 | )% | (51.8 | )% | (20.8 | )% | ||||||
Other income | — | 100 | NM | — | % | 0.6 | % | |||||||||
Interest expense | (67 | ) | (70 | ) | 4.3 | % | (0.5 | )% | (0.4 | )% | ||||||
Interest income | 5 | 10 | (50.0 | )% | — | % | 0.1 | % | ||||||||
Loss before income tax | (6,564 | ) | (3,211 | ) | (104.4 | )% | (52.3 | )% | (20.5 | )% | ||||||
Income tax expense | — | (271 | ) | NM | — | % | (1.7 | )% | ||||||||
Net loss | $ | (6,564 | ) | $ | (2,940 | ) | (123.3 | )% | (52.3 | )% | (18.8 | )% |
For the Three Months Ended June 30, | ||||||||||
2017 | 2016 | % Change | ||||||||
Revenues | $ | 1,390 | $ | 5,901 | (76.4 | )% | ||||
Operating loss | $ | (1,532 | ) | $ | (57 | ) | NM | |||
Operating margin | (110.2 | )% | (1.0 | )% |
For the Three Months Ended June 30, | ||||||||||
2017 | 2016 | % Change | ||||||||
Revenues | $ | 5,408 | $ | 6,800 | (20.5 | )% | ||||
Operating loss | $ | (1,891 | ) | $ | (769 | ) | (145.9 | )% | ||
Operating margin | (35.0 | )% | (11.3 | )% |
For the Three Months Ended June 30, | ||||||||||
2017 | 2016 | % Change | ||||||||
Revenues | $ | 5,760 | $ | 2,933 | 96.4 | % | ||||
Operating loss | (741 | ) | (728 | ) | (1.8 | )% | ||||
Operating margin | (12.9 | )% | (24.8 | )% |
Three Months Ended June 30, | |||||||
2017 | 2016 | ||||||
Operating activities | $ | (5,755 | ) | $ | (2,315 | ) | |
Investing activities | (224 | ) | 2,547 | ||||
Financing activities | (2,843 | ) | (1,614 | ) | |||
Increase (decrease) in cash and cash equivalents | $ | (8,822 | ) | $ | (1,382 | ) |
ITEM 4. | CONTROLS AND PROCEDURES |
i. | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; |
ii. | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and |
iii. | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. |
• | Information & Communication. We determined that our controls pertaining to information and communication did not operate effectively, resulting in a material weakness pertaining to these COSO components. Specifically, we did not have sufficient communication of the status and evolution of a project to ensure timely and accurate recognition of project costs. In addition, we did not have sufficient communication and resolution of matters identified through management’s review impacting the accounting close as noted in the Control Activities discussion below. |
• | Control Activities - Accounting Close. The operating effectiveness of our controls were inadequate to ensure that project costs were identified and recorded to expense in a timely manner. In addition, matters identified through management review controls were not brought to a timely resolution. |
• | Ensure a thorough understanding of the “as is” state, process owners, and procedural or technological gaps causing the deficiency; |
• | Design and evaluate a remediation action for the review and analysis of project costs; validate or improve the related policy and procedures; evaluate skills of the process owners with regard to the policy and adjust as required; |
• | Implement specific remediation actions: train process owners, allow time for process adoption and adequate transaction volume for next steps; |
• | Test and measure the design and effectiveness of the remediation actions; test and provide feedback on the design and operating effectiveness of the controls, and: |
• | Review and acceptance of completion of the remediation effort by executive management and the Audit & Finance Committee. |
• | Developed a regular method for the evaluation of actual project costs incurred against budgeted costs and for the communication of such costs and project status. |
• | Revisited the method in which projects are reviewed and evaluated by the accounting department to ensure the accurate and timely recording of necessary adjustments. |
• | Formalize and strengthen management review controls as they pertain to the accounting close. |
• | Enhance documentation of policies and procedures related to project accounting, account reconciliations, and other key areas within the accounting close. |
• | Provide training to key process owners. |
• | Enhance information technology reporting capabilities, where possible, to ensure consistent, accurate data to support accounting close processes in a timely and efficient manner. |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
Issuer Purchases of Equity Securities | ||||||||||
Period | Total Number of Shares Purchased (1) (2) | Average Price Per Share (2) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs | ||||||
April 1 to April 30 | — | $ | — | — | $ | — | ||||
May 1 to May 31 | — | — | — | — | ||||||
June 1 to June 30 | 1,230 | 1.28 | — | $ | — | |||||
Total | 1,230 | — | — |
(1) | Represents shares of our common stock. |
(2) | In prior years, we have issued loans to certain of our non-executive employees to purchase shares of our common stock. The loan program has been discontinued and new loans are no longer issued. As of March 31, 2017, $4,000 of such loans remained outstanding. During the quarter ended June 30, 2017, we entered into agreements with the counterparties to these loans. In exchange for the forgiveness of their outstanding loan balance, the employees returned their shares to us. As a result of this transaction, 1,230 shares were recorded within treasury stock and the loan balances have been eliminated. |
ITEM 5. | OTHER INFORMATION |
ITEM 6. | EXHIBITS |
10.1 | Executive Employment and Severance Agreement, dated April 1, 2017, by and between Orion Energy Systems, Inc. and Michael J. Potts [Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 3, 2017 (File No. 001-33887)] |
10.2 | Orion Energy Systems, Inc. Non-Employee Director Compensation Plan, updated and effective as of June 6, 2017 [Incorporated by reference to Exhibit 10.14 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.3 | Executive Employment and Severance Agreement, dated as of June 8, 2017, by and between Orion Energy Systems, Inc. and Michael W. Altschaefl [Incorporated by reference to Exhibit 10.16 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.4 | Mutual Termination and Severance Agreement and Complete and Permanent Release of All Claims, dated June 8, 2017, by and between Orion Energy Systems, Inc. and John H. Scribante [Incorporated by reference to Exhibit 10.27 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.5 | Letter Agreement effective June 13, 2017 between Orion and William T. Hull [Incorporated by reference to Exhibit 10.19 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.6 | Mutual Retirement and Severance Agreement and Complete and Permanent Release of All Claims, dated June 30, 2017. by and between Orion Energy Systems, Inc. and Michael J. Potts [Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 30, 2017 (File No. 001-33887)] |
31.1 | Certification of Chief Executive Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. |
31.2 | Certification of Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. |
32.1 | Certification of Chief Executive Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2 | Certification of Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS | XBRL Instance Document |
101.SCH | Taxonomy extension schema document |
101.CAL | Taxonomy extension calculation linkbase document |
101.LAB | Taxonomy extension label linkbase document |
101.PRE | Taxonomy extension presentation linkbase document |
+ | Filed herewith |
ORION ENERGY SYSTEMS, INC. Registrant | ||
By | /s/ William T. Hull | |
William T. Hull | ||
Chief Financial Officer | ||
(Principal Financial Officer and Authorized Signatory) |
10.1 | Executive Employment and Severance Agreement, dated April 1, 2017, by and between Orion Energy Systems, Inc. and Michael J. Potts [Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 3, 2017 (File No. 001-33887)] |
10.2 | Orion Energy Systems, Inc. Non-Employee Director Compensation Plan, updated and effective as of June 6, 2017 [Incorporated by reference to Exhibit 10.14 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.3 | Executive Employment and Severance Agreement, dated as of June 8, 2017, by and between Orion Energy Systems, Inc. and Michael W. Altschaefl [Incorporated by reference to Exhibit 10.16 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.4 | Mutual Termination and Severance Agreement and Complete and Permanent Release of All Claims, dated June 8, 2017, by and between Orion Energy Systems, Inc. and John H. Scribante [Incorporated by reference to Exhibit 10.27 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.5 | Letter Agreement effective June 13, 2017 between Orion and William T. Hull [Incorporated by reference to Exhibit 10.19 to the Registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2017 (File No. 001-33887)] |
10.6 | Mutual Retirement and Severance Agreement and Complete and Permanent Release of All Claims, dated June 30, 2017. by and between Orion Energy Systems, Inc. and Michael J. Potts [Incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 30, 2017 (File No. 001-33887)] |
31.1 | Certification of Chief Executive Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. |
31.2 | Certification of Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(a) or Rule 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended. |
32.1 | Certification of Chief Executive Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2 | Certification of Chief Financial Officer of Orion Energy Systems, Inc. pursuant to Rule 13a-14(b) promulgated under the Securities Exchange Act of 1934, as amended, and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS | XBRL Instance Document |
101.SCH | Taxonomy extension schema document |
101.CAL | Taxonomy extension calculation linkbase document |
101.LAB | Taxonomy extension label linkbase document |
101.PRE | Taxonomy extension presentation linkbase document |
1. | I have reviewed this Quarterly Report on Form 10-Q of Orion Energy Systems, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
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. |
/s/ Michael A. Altschaefl |
Michael W. Altschaefl |
Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of Orion Energy Systems, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
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. |
/s/ William T. Hull |
William T. Hull |
Chief Financial Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: | August 4, 2017 |
/s/ Michael A. Altschaefl | |
Michael W. Altschaefl | |
Chief Executive Officer |
1. | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: | August 4, 2017 |
/s/ William T. Hull | |
William T. Hull | |
Chief Financial Officer |
Document and Entity Information - shares |
3 Months Ended | |
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Jun. 30, 2017 |
Jul. 28, 2017 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ORION ENERGY SYSTEMS, INC. | |
Entity Central Index Key | 0001409375 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --03-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 28,763,663 |
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Jun. 30, 2017 |
Mar. 31, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 30,000,000 | 30,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (in shares) | 38,161,796 | 37,747,227 |
Common stock, shares outstanding (in shares) | 28,732,979 | 28,317,490 |
Treasury stock (in shares) | 9,428,817 | 9,429,737 |
DESCRIPTION OF BUSINESS |
3 Months Ended |
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Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS Organization Orion includes Orion Energy Systems, Inc., a Wisconsin corporation, and all consolidated subsidiaries. Orion is a developer, manufacturer and seller of lighting and energy management systems to commercial and industrial businesses, and federal and local governments, predominantly in North America. Orion’s corporate offices and leased primary manufacturing operations are located in Manitowoc, Wisconsin. Orion leases office space in Jacksonville, Florida; Chicago, Illinois; and Houston, Texas. Orion also leases warehouse space in Manitowoc, Wisconsin and Augusta, Georgia. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
3 Months Ended |
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Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The condensed consolidated financial statements include the accounts of Orion Energy Systems, Inc. and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Reclassifications Where appropriate, certain reclassifications have been made to prior years’ financial statements to conform to the current year presentation. Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Orion have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of results that may be expected for the year ending March 31, 2018 or other interim periods. The condensed consolidated balance sheet at March 31, 2017 has been derived from the audited consolidated financial statements at that date but does not include all of the information required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in Orion’s Annual Report on Form 10-K for the fiscal year ended March 31, 2017 filed with the Securities and Exchange Commission on June 13, 2017. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during that reporting period. Areas that require the use of significant management estimates include revenue recognition, inventory obsolescence, allowance for doubtful accounts, accruals for warranty and loss contingencies, income taxes and certain equity transactions. Accordingly, actual results could differ from those estimates. Concentration of Credit Risk and Other Risks and Uncertainties Orion's cash is deposited with two financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. Orion has not experienced any losses in such accounts and believes that it is not exposed to any significant financial institution viability risk on these balances. Orion purchases components necessary for its lighting products, including ballasts, lamps and LED components, from multiple suppliers. For the three months ended June 30, 2017 and 2016, no supplier accounted for more than 10% of total cost of revenue. For the three months ended June 30, 2017, one customer accounted for 16.2% of total revenue. For the three months ended June 30, 2016, no customer accounted for more than 10% of revenue. As of June 30, 2017, no customer accounted for more than 10% of accounts receivable. As of March 31, 2017, one customer accounted for 11.6% of accounts receivable. Recent Accounting Pronouncements Issued: Not Yet Adopted In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-15, "Classification of Certain Cash Receipts and Cash Payments," which provides clarification and additional guidance as to the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The ASU provides guidance, as to the classification of a number of transactions including: contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The new standard will be effective for Orion in the first quarter of fiscal 2019 and will be applied through retrospective adjustment to all periods presented. Orion does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Subtopic 842)." This ASU requires that lessees recognize right-of-use assets and liabilities on the balance sheet for the rights and obligations created by long-term leases and disclose additional quantitative and qualitative information about leasing arrangements. Under this ASU, leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Similarly, lessors will be required to classify leases as sales-type, finance or operating leases, with classification affecting the pattern of income recognition. Classification for both lessees and lessors will be based on an assessment of whether risks and rewards as well as substantive control have been transferred through the lease contract. This ASU also provides guidance on the presentation of the effects of leases in the income statement and statement of cash flows. This guidance will be effective for Orion on April 1, 2019. Early adoption of the standard is permitted and a modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has not yet completed its review of the full provisions of this standard against its outstanding lease arrangements and is in the process of quantifying the lease liability and related right of use asset which will be recorded to its consolidated balance sheets upon adoption of the standard. In addition, management continues to assess the impact of adoption of this standard on its consolidated statements of operations, cash flows, and the related footnote disclosures. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers." This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In addition, the ASU requires enhanced and expanded financial statement disclosures. Since the issuance of this ASU, the FASB has issued further ASU’s to provide additional guidance and clarification as to the application of ASU 2014-09 and delaying its original effective date. The ASU allows companies to elect either a full retrospective or modified retrospective approach to adoption. Orion will adopt ASU 2014-09 and the related updates with their effective date on April 1, 2018. Orion has begun the process of implementing this standard, including performing a review of its revenue streams to identify any differences in the timing, measurement, or presentation of revenue recognition. The Company continues to review the provisions of these standards against its customer contracts, including evaluating and identifying distinct performance obligations and variable consideration in the form of customer rebates. The Company has selected a representative sample of customer contracts from each of its major revenue streams and is in the process of evaluating these contracts against the standards to determine any impact on the timing and presentation of revenue. In addition, the Company has identified necessary changes in its ongoing process for the review of new customer contracts and the identification of key terms impacting revenue recognition. The Company is also evaluating the necessary changes to its systems, revenue related processes and controls as a result of the new standard, including the related footnote disclosures. Under ASU 2014-09 incremental contract costs, including sales commissions, may be required to be capitalized and expensed over the period these costs are recovered. Although Orion incurs commission costs, its contracts are typically completed within one year. As such, the Company will elect to apply the practical expedient for contract costs recovered within one year and will continue to recognize commissions as cost of sales immediately rather than capitalizing and expensing these costs over the contract period. Orion currently plans to elect the modified retrospective adoption method but continues to evaluate both of the available transition methods. In May 2017, the FASB issued ASU 2017-09, “Compensation-Stock Compensation: Scope of Modification Accounting” which provides guidance about which changes to the terms or conditions of a share-based payment award would require an entity to apply modification accounting. The provisions of this standard are effective for Orion beginning on April 1, 2018. The adoption of this standard is not expected to have a material impact on Orion’s consolidated condensed financial statements. Recently Adopted Standards In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes,” to simplify the presentation of deferred taxes. The amendments in this update require that deferred tax assets and liabilities be classified as non-current on the balance sheet. This ASU is effective for Orion's annual reporting period, and interim periods therein, as of April 1, 2017. The adoption of this standard had no impact on Orion’s condensed consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory,” which changes the measurement principle for inventory from the lower of cost or market to the lower of cost or net realizable value for entities that measure inventory using first-in, first-out ("FIFO") or average cost. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Orion adopted this standard as of April 1, 2017. The adoption of this standard had no impact on its condensed consolidated financial statements as the previous measurement and validation of the carrying value of its inventory incorporated market values consistent with the net realizable value measurements of the standard. In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which changes how companies account for certain aspects of share-based payment awards to employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as the classification of related matters in the statement of cash flows. Orion adopted this ASU as of April 1, 2017. As a result of adopting the income tax accounting provisions of this standard, Orion realized an increase in both its deferred tax assets related to stock-based compensation awards and the related valuation allowance. As the Company carries a full valuation allowance against its deferred tax assets, there was no net impact to its condensed consolidated balance sheets or statements of operations. In accordance with the provisions of this standard, the Company elected to prospectively adopt an accounting policy to recognize forfeitures as they occur in lieu of estimating forfeitures. The cashflow presentation provisions of the standard had no impact on Orion’s condensed consolidated financial statements. Finally, due to the Company’s net loss, the modifications to the calculation of diluted earnings per share as a result of adopting this standard did not impact its diluted earnings per share. |
ACCOUNTS RECEIVABLE |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
ACCOUNTS RECEIVABLE | ACCOUNTS RECEIVABLE Orion's accounts receivable and allowance for doubtful accounts balances were as follows (dollars in thousands):
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INVENTORIES |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INVENTORIES | INVENTORIES As of June 30, 2017 and March 31, 2017, Orion's inventory balances were as follows (dollars in thousands):
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PREPAID EXPENSES AND OTHER CURRENT ASSETS |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
PREPAID EXPENSES AND OTHER CURRENT ASSETS | PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets include the following (dollars in thousands):
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PROPERTY AND EQUIPMENT |
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PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment were comprised of the following (dollars in thousands):
During the three months ended June 30, 2017, the Company began pursuing the potential sale and leaseback of its Tech Center building located in Manitowoc, Wisconsin. The Tech Center building houses Orion's corporate offices. Due to the expected leaseback of more than a minor portion of the facility, it does not meet the criteria to be classified as held for sale as of June 30, 2017. As a result of this action, Orion assessed the facility for impairment as of June 30, 2017 by performing a probability weighted cashflow analysis (a Level 3 fair value measure). As a result of this analysis, and based on the assumptions used, including management’s best estimate of the potential sales price, future rent expense, sublease income, and the probability of various scenarios under consideration, the Company concluded that the asset is not impaired as of June 30, 2017. Equipment included above under capital leases was as follows (dollars in thousands):
Orion recorded depreciation expense of $0.4 million for the three months ended June 30, 2017 and 2016. |
INTANGIBLE ASSETS |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
INTANIGBLE ASSETS | INTANGIBLE ASSETS The components of, and changes in, the carrying amount of other intangible assets were as follows (dollars in thousands):
Amortization expense on intangible assets was $0.2 million for the three months ended June 30, 2017 and 2016. As of June 30, 2017, the weighted average useful life of intangible assets was 5.90 years. The estimated amortization expense for the next five years and beyond is shown below (dollars in thousands):
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OTHER LONG-TERM ASSETS |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
OTHER LONG-TERM ASSETS | OTHER LONG-TERM ASSETS Other long-term assets include the following (dollars in thousands):
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ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES |
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Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES | ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES Accrued expenses and other include the following (dollars in thousands):
Other long term liabilities includes the following (dollars in thousands):
Orion generally offers a limited warranty of one to ten years on its lighting products in addition to those standard warranties offered by major original equipment component manufacturers. The manufacturers’ warranties cover lamps and ballasts, which are significant components in Orion's lighting products. Changes in Orion’s warranty accrual (both current and long-term) were as follows (dollars in thousands):
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NET LOSS PER COMMON SHARE |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NET LOSS PER COMMON SHARE | NET LOSS PER COMMON SHARE Basic net loss per common share is computed by dividing net loss attributable to common shareholders by the weighted-average number of common shares outstanding for the period and does not consider common stock equivalents. For the three months ended June 30, 2017 and 2016, Orion was in a net loss position; therefore, the basic and diluted weighted average shares outstanding are equal because any increase to the basic shares would be anti-dilutive. Net loss per common share is calculated based upon the following:
The following table indicates the number of potentially dilutive securities excluded from the calculation of diluted net loss per common share because their inclusion would have been anti-dilutive. The number of shares are as of the end of each period:
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RELATED PARTY TRANSACTIONS |
3 Months Ended |
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Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS During the three months ended June 30, 2017, Orion did not have any related party transactions. During the three months ended June 30, 2016, Orion purchased goods and services from an entity in the amount of approximately two thousand dollars, at which time a director of Orion served as a minority owner and as the president and chairman of the board of directors. |
LONG-TERM DEBT |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consisted of the following (dollars in thousands):
Revolving Credit Agreement Orion has an amended credit agreement ("Credit Agreement") that provides for a revolving credit facility ("Credit Facility") subject to a borrowing base requirement based on eligible receivables and inventory. As of June 30, 2017 Orion's borrowing base was approximately $4.1 million. The Credit Facility has a maturity date of February 6, 2019 and includes a $2.0 million sublimit for the issuance of letters of credit. As of June 30, 2017, Orion had no outstanding letters of credit. Borrowings outstanding as of June 30, 2017, amounted to approximately $3.9 million and are included in non-current liabilities in the accompanying condensed consolidated balance sheet. Orion estimates that as of June 30, 2017, it was eligible to borrow an additional $0.2 million under the Credit Facility based upon current levels of eligible inventory and accounts receivable. Subject in each case to Orion's applicable borrowing base limitations, the Credit Agreement otherwise provides for a $15.0 million Credit Facility. This limit may increase to $20.0 million based on a borrowing base requirement, if Orion satisfies certain conditions. Orion did not meet the requirements to increase the borrowing limit to $20.0 million as of July 31, 2017, the most recent measurement date. From and after any increase in the Credit Facility limit from $15.0 million to $20.0 million, the Credit Agreement requires that Orion maintain, as of the end of each month, a minimum ratio for the trailing twelve-month period of (i) earnings before interest, taxes, depreciation and amortization, subject to certain adjustments, to (ii) the sum of cash interest expense, certain principal payments on indebtedness and certain dividends, distributions and stock redemptions, equal to at least 1.10 to 1.00. The Credit Agreement contains additional customary covenants, including certain restrictions on Orion’s ability to incur additional indebtedness, consolidate or merge, enter into acquisitions, guarantee obligations of third parties, make loans or advances, declare or pay any dividend or distribution on Orion’s stock, redeem or repurchase shares of Orion’s stock, or pledge or dispose of assets. Orion was in compliance with its covenants in the Credit Agreement as of June 30, 2017. Each subsidiary of Orion is a joint and several co-borrower or guarantor under the Credit Agreement, and the Credit Agreement is secured by a security interest in substantially all of Orion’s and each subsidiary’s personal property (excluding various assets relating to customer OTAs) and a mortgage on certain real property. Borrowings under the Credit Agreement bear interest at the daily three-month LIBOR plus 3.0% per annum, with a minimum interest charge for each year or portion of a year during the term of the Credit Agreement of $0.1 million, regardless of usage. As of June 30, 2017, the interest rate was 4.30%. Orion must pay an unused line fee of 0.25% per annum of the daily average unused amount of the Credit Facility and a letter of credit fee at the rate of 3.0% per annum on the undrawn amount of letters of credit outstanding from time to time under the Credit Facility. Harris Seller's Note On July 1, 2013, Orion issued an unsecured and subordinated promissory note in the principal amount of $3.1 million to partially fund the acquisition of Harris Manufacturing, Inc. and Harris LED, LLC (collectively, "Harris"). The note's interest rate was 4% per annum. Principal and interest were payable quarterly. The note matured in July 2016 and was paid in full upon maturity. Equipment Lease Obligation In March 2016 and June 2015, Orion entered into lease agreements with a financing company in the principal amount of nineteen thousand dollars and $0.4 million, respectively, to fund certain equipment. The leases are secured by the related equipment. The leases bear interest at a rate of 5.9% and 3.6%, respectively, and mature in February 2018 and June 2020. Both leases contain a one dollar buyout option. Customer Equipment Finance Notes Payable In December 2014, Orion entered into a secured borrowing agreement with a financing company in the principal amount of $0.4 million to fund completed customer contracts under its OTA finance program that were previously funded under a different OTA credit agreement. The loan amount is secured by the OTA-related equipment and the expected future monthly payments under the supporting 25 individual OTA customer contracts. The borrowing agreement bears interest at a rate of 8.36% and matures in April 2018. In June 2011, Orion entered into a note agreement with a financial institution that provided Orion with $2.8 million to fund completed customer contracts under Orion’s OTA finance program. The note bore interest at 7.85%. The note matured in April 2016 and was paid in full upon maturity. Other Long-Term Debt In September 2010, Orion entered into a note agreement with the Wisconsin Department of Commerce that provided Orion with $0.3 million to fund Orion’s rooftop solar project at its Manitowoc facility. This note is included in the table above as other long-term debt. The note is collateralized by the related solar equipment. The note allowed for two years without interest accruing or principal payments due. Beginning in July 2012, the note bears interest at 2% and requires monthly payments of four thousand six hundred. The note matured in June 2017 and was paid in full upon maturity. |
INCOME TAXES |
3 Months Ended |
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Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The income tax provision for the three months ended June 30, 2017 was determined by applying an estimated annual effective tax rate of 0.0% to loss before income tax. The estimated effective tax rate for the three month period ended June 30, 2016 was (0.3)%. The estimated effective income tax rate was determined by applying statutory tax rates to pretax loss adjusted for certain permanent book to tax differences and tax credits. Orion is eligible for tax benefits associated with the excess of the tax deduction available for exercises of non-qualified stock options (NQSOs) over the amount recorded at grant. The amount of the benefit is based upon the ultimate deduction reflected in the applicable income tax return. As of June 30, 2017, Orion had federal net operating loss carryforwards of approximately $75.7 million. Orion also has state net operating loss carryforwards of approximately $65.2 million. Orion also had federal tax credit carryforwards of approximately $1.4 million and state tax credits of $0.7 million. Orion's net operating loss and tax credit carryforwards will begin to expire in varying amounts between 2020 and 2036. As of June 30, 2017, Orion had recorded a valuation allowance of $34.0 million equaling the net deferred tax asset due to the uncertainty of its realization value in the future. Orion considers future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance. In the event that Orion determines that the deferred tax assets are able to be realized, an adjustment to the deferred tax asset would increase income in the period such determination is made. Uncertain Tax Positions As of June 30, 2017, the balance of gross unrecognized tax benefits was approximately $0.1 million, all of which would reduce Orion’s effective tax rate if recognized. Orion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Orion recognizes penalties and interest related to uncertain tax liabilities in income tax expense. Penalties and interest are immaterial and are included in the unrecognized tax benefits. |
COMMITMENTS AND CONTINGENCIES |
3 Months Ended |
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Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Operating Leases Orion leases office space and equipment under operating leases expiring at various dates through 2020. Rent expense under operating leases was $0.2 million and $0.1 million for the three months ended June 30, 2017 and 2016, respectively. On April 28, 2017, Orion renewed the lease for its Jacksonville, Florida office space for an additional three-year term with annual rent expense of approximately $0.1 million. On March 31, 2016, Orion entered into a purchase and sale agreement ("Agreement") with a third party to sell and leaseback Orion's manufacturing and distribution facility for a gross cash proceeds of $2.6 million. The transaction closed on June 30, 2016. Litigation Orion is subject to various claims and legal proceedings arising in the ordinary course of business. As of the date of this report, Orion is unable to currently assess whether the final resolution of any of such claims or legal proceedings may have a material adverse effect on our future results of operations. In addition to ordinary-course litigation, Orion is a party to the proceedings described below. On March 27, 2014, Orion was named as a defendant in a civil lawsuit filed by Neal R. Verfuerth, a Former Chief Executive Officer who was terminated for cause in November 2012, in the United States District Court for the Eastern District of Wisconsin (Green Bay Division). The plaintiff alleged, among other things, that Orion breached certain agreements entered into with the plaintiff, including the plaintiff’s employment agreement, and violated certain laws. The complaint sought, among other relief, unspecified pecuniary and compensatory damages, fees and such other relief as the court may deem just and proper. On November 4, 2014, the court granted Orion's motion to dismiss six of the plaintiff's claims. On January 9, 2015, the plaintiff filed an amended complaint re-alleging claims that were dismissed by the court, including, among other things, a retaliation claim and certain claims with respect to prior management agreements and certain intellectual property rights. On January 22, 2015, Orion filed a motion to dismiss and a motion to strike certain of the claims made in the amended complaint. On May 18, 2015, the court dismissed the intellectual property claims re-alleged in the January 9, 2015 amended complaint. At the court's direction, the parties attempted to mediate the matter in May 2016, but were unsuccessful in resolving the matter. On August 25, 2016, the Chief Judge of the United States District Court for the Eastern District of Wisconsin (Green Bay Division) dismissed all claims against Orion brought by the plaintiff, including his claims that Orion had allegedly breached the plaintiff’s employment agreement and had allegedly violated the plaintiff's whistleblower rights. On September 22, 2016, the plaintiff filed an appeal to the United States Court of Appeals challenging the judgment rendered on August 25, 2016. After the court-mandated mediation was unsuccessful, the plaintiff moved forward with his appeal focusing only on the District Court's dismissal of his whistleblower claims. Orion intends to continue to defend against the claims vigorously. Orion believes it has substantial legal and factual defenses to the claims and allegations remaining in the case and that Orion will prevail in this proceeding. Based upon the current status of the lawsuit, Orion does not believe that it is reasonably possible that the lawsuit will have a material adverse impact on its future continuing results of operations. State Tax Assessment Orion negotiated a settlement with the Wisconsin Department of Revenue with respect to an assessment regarding the proper classification of its products for tax purposes under Wisconsin law. Orion resolved this matter with the Wisconsin Department of Revenue in June 2016 for $0.5 million. |
SHAREHOLDERS’ EQUITY |
3 Months Ended |
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Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS’ EQUITY Employee Stock Purchase Plan In August 2010, Orion’s board of directors approved a non-compensatory employee stock purchase plan, or ESPP. As of June 30, 2017, Orion issued 2,150 shares under the ESPP plan at a closing market price of $1.28. In prior years, Orion issued loans to non-executive employees to purchase shares of its stock. The loan program has been discontinued and new loans are no longer issued. As of March 31, 2017, four thousand dollars of such loans remained outstanding and were reflected on Orion’s balance sheet as a contra-equity account. During the quarter ended June 30, 2017, Orion entered into agreements with the counterparties to these loans. In exchange for the forgiveness of their outstanding loan balance, the employees returned their shares to Orion. As a result of this transaction, 1,230 shares were recorded within treasury stock and the loan balances have been eliminated. |
STOCK OPTIONS AND RESTRICTED SHARES |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
STOCK OPTIONS AND RESTRICTED SHARES | STOCK OPTIONS AND RESTRICTED SHARES At Orion's 2016 Annual Meeting of Shareholders held on August 3, 2016, Orion's shareholders approved the Orion Energy Systems, Inc. 2016 Omnibus Incentive Plan (the "Plan"). The Plan authorizes grants of equity-based and incentive cash awards to eligible participants designated by the Plan's administrator. Awards under the Plan may consist of stock options, stock appreciation rights, performance shares, performance units, shares of Orion's common stock ("Common Stock"), restricted stock, restricted stock units, incentive awards or dividend equivalent units. Prior to shareholder approval of the Plan, the Company maintained its 2004 Stock and Incentive Awards Plan, as amended, which authorized the grant of cash and equity awards to employees (the “Former Plan”). No new awards are being granted under the Former Plan, however, all awards granted under the Former Plan that were outstanding as of August 3, 2016 will continue to be governed by the Former Plan. Certain non-employee directors have elected to receive stock awards in lieu of cash compensation pursuant to elections made under Orion’s non-employee director compensation program. The plans also permit accelerated vesting in the event of certain changes of control of Orion as well as under other special circumstances. The following amounts of stock-based compensation were recorded (dollars in thousands):
During the first three months of fiscal 2018, Orion had the following activity related to its stock based compensation:
As of June 30, 2017, the amount of deferred stock-based compensation expense to be recognized, over a remaining period of 2.3 years, was approximately $2.2 million. |
SEGMENTS |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEGMENTS | SEGMENTS Orion has the following business segments: Orion U.S. Markets Division ("USM"), Orion Engineered Services Division ("OES") and Orion Distribution Services Division ("ODS"). The accounting policies are the same for each business segment as they are on a consolidated basis. Orion U.S. Markets Division ("USM") The USM segment sells commercial lighting systems and energy management systems to the wholesale contractor markets. USM customers include ESCOs and electrical contractors. A significant portion of the historic sales of this division migrated to distribution channel sales as a result of the implementation of Orion’s distribution sales strategy. The migrated sales are included in Orion's ODS Division. This migration is expected to continue during fiscal 2018. Orion Engineered Systems Division ("OES") The OES segment develops and sells lighting products and provides construction and engineering services for Orion's commercial lighting and energy management systems. OES provides turnkey solutions for large national accounts, governments, municipalities and schools. Orion Distribution Services Division ("ODS") The ODS segment focuses on selling lighting products through manufacturer representative agencies and a network of broadline North American distributors. This segment expanded in fiscal 2018 as a result of the expansion of sales through distributors after the implementation of our distribution sales strategy. This expansion included the migration of customers from direct sales previously included in our USM division. Corporate and Other Corporate and Other is comprised of operating expenses not directly allocated to Orion’s segments and adjustments to reconcile to consolidated results (dollars in thousands).
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REORGANIZATION OF BUSINESS |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
REORGANIZATION OF BUSINESS | REORGANIZATION OF BUSINESS During the three months ended June 30, 2017, Orion implemented a reorganization and targeted cost savings plan. As a result, the Company entered into separation agreements with 17 employees and recognized $1.9 million of restructuring expense consisting of severance, outplacement services, and continued medical benefits for terminated employees for a limited post-employment period. The restructuring expense for the three months ended June 30, 2017 is reflected within Orion’s condensed statement of operations as follows (dollars in thousands):
Total restructuring expense by segment was recorded as follows (dollars in thousands):
The following table displays a rollforward of the reorganization of business accruals established for employee separation costs from March 31, 2017 to June 30, 2017 (dollars in thousands):
The remaining accrual of $0.5 million for employee separation costs is expected to be paid within the next twelve months. |
SUBSEQUENT EVENTS |
3 Months Ended |
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Jun. 30, 2017 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS Subsequent events are events or transactions that occur after the balance sheet date but before financial statements are issued. Recognized subsequent events are events or transactions that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements. Non-recognized subsequent events are events that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. Management has reviewed events occurring through the date the financial statements were issued and noted no subsequent event requiring accrual or disclosure. |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) |
3 Months Ended |
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Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of Orion Energy Systems, Inc. and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. |
Reclassifications | Reclassifications Where appropriate, certain reclassifications have been made to prior years’ financial statements to conform to the current year presentation. |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of Orion have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information and with the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Interim results are not necessarily indicative of results that may be expected for the year ending March 31, 2018 or other interim periods. The condensed consolidated balance sheet at March 31, 2017 has been derived from the audited consolidated financial statements at that date but does not include all of the information required by GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes thereto included in Orion’s Annual Report on Form 10-K for the fiscal year ended March 31, 2017 filed with the Securities and Exchange Commission on June 13, 2017. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during that reporting period. Areas that require the use of significant management estimates include revenue recognition, inventory obsolescence, allowance for doubtful accounts, accruals for warranty and loss contingencies, income taxes and certain equity transactions. Accordingly, actual results could differ from those estimates. |
Concentration of Credit Risk and Other Risks and Uncertainties | Concentration of Credit Risk and Other Risks and Uncertainties Orion's cash is deposited with two financial institutions. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. Orion has not experienced any losses in such accounts and believes that it is not exposed to any significant financial institution viability risk on these balances. Orion purchases components necessary for its lighting products, including ballasts, lamps and LED components, from multiple suppliers. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Issued: Not Yet Adopted In August 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-15, "Classification of Certain Cash Receipts and Cash Payments," which provides clarification and additional guidance as to the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. The ASU provides guidance, as to the classification of a number of transactions including: contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. The new standard will be effective for Orion in the first quarter of fiscal 2019 and will be applied through retrospective adjustment to all periods presented. Orion does not expect the adoption of this guidance to have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, “Leases (Subtopic 842)." This ASU requires that lessees recognize right-of-use assets and liabilities on the balance sheet for the rights and obligations created by long-term leases and disclose additional quantitative and qualitative information about leasing arrangements. Under this ASU, leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Similarly, lessors will be required to classify leases as sales-type, finance or operating leases, with classification affecting the pattern of income recognition. Classification for both lessees and lessors will be based on an assessment of whether risks and rewards as well as substantive control have been transferred through the lease contract. This ASU also provides guidance on the presentation of the effects of leases in the income statement and statement of cash flows. This guidance will be effective for Orion on April 1, 2019. Early adoption of the standard is permitted and a modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company has not yet completed its review of the full provisions of this standard against its outstanding lease arrangements and is in the process of quantifying the lease liability and related right of use asset which will be recorded to its consolidated balance sheets upon adoption of the standard. In addition, management continues to assess the impact of adoption of this standard on its consolidated statements of operations, cash flows, and the related footnote disclosures. In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers." This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. In addition, the ASU requires enhanced and expanded financial statement disclosures. Since the issuance of this ASU, the FASB has issued further ASU’s to provide additional guidance and clarification as to the application of ASU 2014-09 and delaying its original effective date. The ASU allows companies to elect either a full retrospective or modified retrospective approach to adoption. Orion will adopt ASU 2014-09 and the related updates with their effective date on April 1, 2018. Orion has begun the process of implementing this standard, including performing a review of its revenue streams to identify any differences in the timing, measurement, or presentation of revenue recognition. The Company continues to review the provisions of these standards against its customer contracts, including evaluating and identifying distinct performance obligations and variable consideration in the form of customer rebates. The Company has selected a representative sample of customer contracts from each of its major revenue streams and is in the process of evaluating these contracts against the standards to determine any impact on the timing and presentation of revenue. In addition, the Company has identified necessary changes in its ongoing process for the review of new customer contracts and the identification of key terms impacting revenue recognition. The Company is also evaluating the necessary changes to its systems, revenue related processes and controls as a result of the new standard, including the related footnote disclosures. Under ASU 2014-09 incremental contract costs, including sales commissions, may be required to be capitalized and expensed over the period these costs are recovered. Although Orion incurs commission costs, its contracts are typically completed within one year. As such, the Company will elect to apply the practical expedient for contract costs recovered within one year and will continue to recognize commissions as cost of sales immediately rather than capitalizing and expensing these costs over the contract period. Orion currently plans to elect the modified retrospective adoption method but continues to evaluate both of the available transition methods. In May 2017, the FASB issued ASU 2017-09, “Compensation-Stock Compensation: Scope of Modification Accounting” which provides guidance about which changes to the terms or conditions of a share-based payment award would require an entity to apply modification accounting. The provisions of this standard are effective for Orion beginning on April 1, 2018. The adoption of this standard is not expected to have a material impact on Orion’s consolidated condensed financial statements. Recently Adopted Standards In November 2015, the FASB issued ASU 2015-17, “Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes,” to simplify the presentation of deferred taxes. The amendments in this update require that deferred tax assets and liabilities be classified as non-current on the balance sheet. This ASU is effective for Orion's annual reporting period, and interim periods therein, as of April 1, 2017. The adoption of this standard had no impact on Orion’s condensed consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, “Inventory (Topic 330): Simplifying the Measurement of Inventory,” which changes the measurement principle for inventory from the lower of cost or market to the lower of cost or net realizable value for entities that measure inventory using first-in, first-out ("FIFO") or average cost. Net realizable value is defined as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Orion adopted this standard as of April 1, 2017. The adoption of this standard had no impact on its condensed consolidated financial statements as the previous measurement and validation of the carrying value of its inventory incorporated market values consistent with the net realizable value measurements of the standard. In March 2016, the FASB issued ASU 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which changes how companies account for certain aspects of share-based payment awards to employees, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as the classification of related matters in the statement of cash flows. Orion adopted this ASU as of April 1, 2017. As a result of adopting the income tax accounting provisions of this standard, Orion realized an increase in both its deferred tax assets related to stock-based compensation awards and the related valuation allowance. As the Company carries a full valuation allowance against its deferred tax assets, there was no net impact to its condensed consolidated balance sheets or statements of operations. In accordance with the provisions of this standard, the Company elected to prospectively adopt an accounting policy to recognize forfeitures as they occur in lieu of estimating forfeitures. The cashflow presentation provisions of the standard had no impact on Orion’s condensed consolidated financial statements. Finally, due to the Company’s net loss, the modifications to the calculation of diluted earnings per share as a result of adopting this standard did not impact its diluted earnings per share. |
ACCOUNTS RECEIVABLE (Tables) |
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Receivables [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Accounts receivable and allowance for doubtful accounts balances | Orion's accounts receivable and allowance for doubtful accounts balances were as follows (dollars in thousands):
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INVENTORIES (Tables) |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | As of June 30, 2017 and March 31, 2017, Orion's inventory balances were as follows (dollars in thousands):
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PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid expenses and other current assets | Prepaid expenses and other current assets include the following (dollars in thousands):
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PROPERTY AND EQUIPMENT (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and equipment | Property and equipment were comprised of the following (dollars in thousands):
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Schedule of equipment under capital leases | Equipment included above under capital leases was as follows (dollars in thousands):
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INTANGIBLE ASSETS (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of other intangible assets | The components of, and changes in, the carrying amount of other intangible assets were as follows (dollars in thousands):
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Estimated amortization expense for each of the next five years | The estimated amortization expense for the next five years and beyond is shown below (dollars in thousands):
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OTHER LONG-TERM ASSETS (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of other long-term assets | Other long-term assets include the following (dollars in thousands):
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ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Liabilities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accrued expenses and other | Accrued expenses and other include the following (dollars in thousands):
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Other long term liabilities | Other long term liabilities includes the following (dollars in thousands):
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Changes in warranty accrual | Changes in Orion’s warranty accrual (both current and long-term) were as follows (dollars in thousands):
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NET LOSS PER COMMON SHARE (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of the effect of net income per common share | For the three months ended June 30, 2017 and 2016, Orion was in a net loss position; therefore, the basic and diluted weighted average shares outstanding are equal because any increase to the basic shares would be anti-dilutive. Net loss per common share is calculated based upon the following:
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Number of potentially dilutive securities | The following table indicates the number of potentially dilutive securities excluded from the calculation of diluted net loss per common share because their inclusion would have been anti-dilutive. The number of shares are as of the end of each period:
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LONG-TERM DEBT (Tables) |
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Jun. 30, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term debt | Long-term debt consisted of the following (dollars in thousands):
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STOCK OPTIONS AND RESTRICTED SHARES (Tables) |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | The following amounts of stock-based compensation were recorded (dollars in thousands):
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Summary of outstanding non-vested stock options | During the first three months of fiscal 2018, Orion had the following activity related to its stock based compensation:
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Summary of restricted shares granted | During the first three months of fiscal 2018, Orion had the following activity related to its stock based compensation:
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SEGMENTS (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment reporting information |
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REORGANIZATION OF BUSINESS (Tables) |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Costs | The restructuring expense for the three months ended June 30, 2017 is reflected within Orion’s condensed statement of operations as follows (dollars in thousands):
Total restructuring expense by segment was recorded as follows (dollars in thousands):
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Change in Restructuring Reserve | The following table displays a rollforward of the reorganization of business accruals established for employee separation costs from March 31, 2017 to June 30, 2017 (dollars in thousands):
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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - financial_instituion |
3 Months Ended | 12 Months Ended |
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Jun. 30, 2017 |
Mar. 31, 2017 |
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Concentration of Credit Risk and Other Risks and Uncertainties | ||
Number of financial institutions | 2 | |
Revenue | Customer Concentration Risk | Customer One | ||
Concentration of Credit Risk and Other Risks and Uncertainties | ||
Concentration risk, percentage | 16.20% | |
Accounts Receivable | Customer Concentration Risk | Customer One | ||
Concentration of Credit Risk and Other Risks and Uncertainties | ||
Concentration risk, percentage | 11.60% |
ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
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Receivables [Abstract] | ||
Accounts receivable, gross | $ 7,216 | $ 9,315 |
Allowance for doubtful accounts | (176) | (144) |
Accounts receivable, net | $ 7,040 | $ 9,171 |
INVENTORIES (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
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Cost | ||
Raw materials and components | $ 8,008 | $ 8,104 |
Work in process | 1,693 | 1,918 |
Finished goods | 5,981 | 7,044 |
Total | 15,682 | 17,066 |
Reserve | ||
Raw materials and components | (1,677) | (1,807) |
Work in process | (348) | (329) |
Finished goods | (1,391) | (1,337) |
Total | (3,416) | (3,473) |
Net | ||
Raw materials and components | 6,331 | 6,297 |
Work in process | 1,345 | 1,589 |
Finished goods | 4,590 | 5,707 |
Total | $ 12,266 | $ 13,593 |
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Unbilled accounts receivable | $ 2,467 | $ 2,226 |
Other prepaid expenses | 626 | 651 |
Total | $ 3,093 | $ 2,877 |
PROPERTY AND EQUIPMENT (Summary of Property and Equipment) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
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Property and equipment | ||
Gross property and equipment | $ 33,897 | $ 33,734 |
Less: accumulated depreciation and amortization | (20,259) | (19,948) |
Property and equipment, net | 13,638 | 13,786 |
Land and land improvements | ||
Property and equipment | ||
Gross property and equipment | 424 | 424 |
Buildings and building improvements | ||
Property and equipment | ||
Gross property and equipment | 9,245 | 9,245 |
Furniture, fixtures and office equipment | ||
Property and equipment | ||
Gross property and equipment | 7,050 | 7,056 |
Leasehold improvements | ||
Property and equipment | ||
Gross property and equipment | 324 | 324 |
Equipment leased to customers | ||
Property and equipment | ||
Gross property and equipment | 4,997 | 4,997 |
Plant equipment | ||
Property and equipment | ||
Gross property and equipment | 11,633 | 11,627 |
Construction in progress | ||
Property and equipment | ||
Gross property and equipment | $ 224 | $ 61 |
PROPERTY AND EQUIPMENT (Equipment under Capital Leases) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
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Capital Leased Assets [Line Items] | ||
Equipment | $ 33,897 | $ 33,734 |
Less: accumulated depreciation and amortization | (20,259) | (19,948) |
Property and equipment, net | 13,638 | 13,786 |
Assets Held under Capital Leases | ||
Capital Leased Assets [Line Items] | ||
Equipment | 581 | 581 |
Less: accumulated depreciation and amortization | (237) | (202) |
Property and equipment, net | $ 344 | $ 379 |
PROPERTY AND EQUIPMENT (Narrative) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 353 | $ 389 |
INTANGIBLE ASSETS (Narrative) (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense | $ 0.2 | $ 0.2 |
Weighted Average | ||
Segment Reporting Information [Line Items] | ||
Intangible assets, estimated economic useful life | 5 years 10 months 24 days |
INTANGIBLE ASSETS (Future Amortization by Fiscal Year) (Details) $ in Thousands |
Jun. 30, 2017
USD ($)
|
---|---|
Finite-Lived Intangible Assets, Estimated Amortization Expense | |
Fiscal 2018 | $ 461 |
Fiscal 2019 | 447 |
Fiscal 2020 | 361 |
Fiscal 2021 | 287 |
Fiscal 2022 | 190 |
Fiscal 2023 | 166 |
Thereafter | 438 |
Total | $ 2,350 |
OTHER LONG-TERM ASSETS (Summary of Other Long-Term Assets) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Security deposits | $ 66 | $ 117 |
Other | 52 | 58 |
Total | $ 118 | $ 175 |
ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Accrued Expenses and Other) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
---|---|---|
Other Liabilities Disclosure [Abstract] | ||
Compensation and benefits | $ 1,802 | $ 2,431 |
Sales tax | 94 | 213 |
Contract costs | 248 | 223 |
Legal and professional fees | 2,116 | 2,262 |
Warranty | 471 | 449 |
Other accruals | 397 | 410 |
Total | $ 5,128 | $ 5,988 |
ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Other Long Term Liabilities) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
---|---|---|
Other Liabilities Disclosure [Abstract] | ||
Warranty | $ 310 | $ 310 |
Medical benefits | 137 | 0 |
Unrecognized tax benefits | 113 | 113 |
Other | 0 | 19 |
Total | $ 560 | $ 442 |
ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Narrative) (Details) |
3 Months Ended |
---|---|
Jun. 30, 2017 | |
Minimum | |
Segment Reporting Information [Line Items] | |
Limited warranty term | 1 year |
Maximum | |
Segment Reporting Information [Line Items] | |
Limited warranty term | 10 years |
ACCRUED EXPENSES AND OTHER LONG-TERM LIABILITIES (Warranty Accrual) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Movement in Standard Product Warranty Accrual | ||
Beginning of period | $ 759 | $ 864 |
Provision to product cost of revenue | 24 | 175 |
Charges | (2) | (1) |
End of period | $ 781 | $ 1,038 |
NET LOSS PER COMMON SHARE (Earnings per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Numerator: | ||
Net loss | $ (6,564) | $ (2,940) |
Denominator: | ||
Weighted-average common shares outstanding (in shares) | 28,455,434 | 27,885,588 |
Weighted-average common shares and common share equivalents outstanding (in shares) | 28,455,434 | 27,885,588 |
Net loss per common share: | ||
Basic (usd per share) | $ (0.23) | $ (0.11) |
Diluted (usd per share) | $ (0.23) | $ (0.11) |
NET LOSS PER COMMON SHARE (Potentially Dilutive Securities) (Details) - shares |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Number of potentially dilutive securities | ||
Potentially dilutive securities outstanding (in shares) | 3,148,598 | 3,432,054 |
Common stock options | ||
Number of potentially dilutive securities | ||
Potentially dilutive securities outstanding (in shares) | 1,442,153 | 1,949,846 |
Restricted shares | ||
Number of potentially dilutive securities | ||
Potentially dilutive securities outstanding (in shares) | 1,706,445 | 1,482,208 |
RELATED PARTY TRANSACTIONS (Details) $ in Thousands |
3 Months Ended |
---|---|
Jun. 30, 2016
USD ($)
| |
Entity that Current Director Owns Minority Interest and Serves as Board of Directors Chairman | |
Related Party Transaction [Line Items] | |
Purchases from related party | $ 2 |
LONG-TERM DEBT (Summary of Long-Term Debt) (Details) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Mar. 31, 2017 |
---|---|---|
Long-term debt | ||
Total long-term debt | $ 4,127 | $ 6,971 |
Less current maturities | (110) | (152) |
Long-term debt, less current maturities | 4,017 | 6,819 |
Customer equipment finance notes payable | ||
Long-term debt | ||
Total long-term debt | 6 | 7 |
Other long-term debt | ||
Long-term debt | ||
Total long-term debt | 0 | 14 |
Revolving credit facility | ||
Long-term debt | ||
Total long-term debt | 3,853 | 6,629 |
Equipment lease obligations | ||
Long-term debt | ||
Total long-term debt | $ 268 | $ 321 |
INCOME TAXES (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Income Taxes | ||
Estimated effective income tax rate | 0.00% | (0.30%) |
Valuation allowance | $ 34.0 | |
Unrecognized tax benefits | 0.1 | |
Federal | ||
Income Taxes | ||
Operating loss carryforwards | 75.7 | |
Tax credit carryforwards | 1.4 | |
State | ||
Income Taxes | ||
Operating loss carryforwards | 65.2 | |
Tax credit carryforwards | $ 0.7 |
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions |
3 Months Ended | ||||
---|---|---|---|---|---|
Apr. 28, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
Nov. 04, 2014
claim
|
Jun. 30, 2017
USD ($)
|
Jun. 30, 2016
USD ($)
|
|
Commitments and Contingencies Disclosure [Abstract] | |||||
Rent expense under operating leases | $ 0.2 | $ 0.1 | |||
Term of operating lease | 3 years | ||||
Annual rent expense | $ 0.1 | ||||
Long-term Purchase Commitment [Line Items] | |||||
Number of plaintiff's claims dismissed (claim) | claim | 6 | ||||
State | Wisconsin Department of Revenue | |||||
Long-term Purchase Commitment [Line Items] | |||||
Amount of settlement | $ 0.5 | $ 0.5 | |||
Manitowoc Manufacturing and Distribution Facility | |||||
Long-term Purchase Commitment [Line Items] | |||||
Gross cash proceeds from sale leaseback agreement | $ 2.6 |
SHAREHOLDERS’ EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands |
3 Months Ended | 83 Months Ended | |
---|---|---|---|
Jun. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Closing Market Price (usd per share) | $ 1.28 | $ 1.28 | |
Loans issued to non-executive employees outstanding | $ 0 | $ 0 | $ 4 |
Treasury stock acquired (shares) | 1,230 | ||
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares Issued Under ESPP Plan (shares) | 2,150 |
STOCK OPTIONS AND RESTRICTED SHARES (Stock-based Compensation) (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Stock-based compensation | ||
Total | $ 320 | $ 329 |
Cost of product revenue | ||
Stock-based compensation | ||
Total | 6 | 14 |
General and administrative | ||
Stock-based compensation | ||
Total | 267 | 267 |
Sales and marketing | ||
Stock-based compensation | ||
Total | 41 | 31 |
Research and development | ||
Stock-based compensation | ||
Total | $ 6 | $ 17 |
STOCK OPTIONS AND RESTRICTED SHARES (Restricted Shares and Stock Options) (Details) |
3 Months Ended |
---|---|
Jun. 30, 2017
$ / shares
shares
| |
Stock Options | |
Non-vested, beginning balance (shares) | 1,520,953 |
Awards granted (shares) | 0 |
Awards vested (shares) | 0 |
Awards forfeited (shares) | (78,800) |
Non-vested, ending balance (shares) | 1,442,153 |
Per share price on grant date (usd per share) | $ / shares | $ 0 |
Restricted shares | |
Restricted Shares | |
Beginning balance (shares) | 1,704,543 |
Awards granted (shares) | 659,272 |
Awards vested (shares) | (414,569) |
Awards forfeited (shares) | (242,801) |
Ending balance (shares) | 1,706,445 |
Restricted shares | Minimum | |
Restricted Shares | |
Per share price on grant date (usd per share) | $ / shares | $ 1.38 |
Restricted shares | Maximum | |
Restricted Shares | |
Per share price on grant date (usd per share) | $ / shares | $ 1.98 |
STOCK OPTIONS AND RESTRICTED SHARES (Narrative) (Details) $ in Millions |
3 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Deferred stock-based compensation related to grants of restricted shares, period of recognition | 2 years 3 months 18 days |
Deferred stock-based compensation related to grants of restricted shares | $ 2.2 |
SEGMENTS (Details) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Jun. 30, 2017 |
Jun. 30, 2016 |
|
Corporate and Other | ||
Revenues | $ 12,558 | $ 15,634 |
Operating Income (Loss) | (6,502) | (3,251) |
Operating Segments | Orion U.S. Markets | ||
Corporate and Other | ||
Revenues | 1,390 | 5,901 |
Operating Income (Loss) | (1,532) | (57) |
Operating Segments | Orion Engineered Systems | ||
Corporate and Other | ||
Revenues | 5,408 | 6,800 |
Operating Income (Loss) | (1,891) | (769) |
Operating Segments | Orion Distribution Services | ||
Corporate and Other | ||
Revenues | 5,760 | 2,933 |
Operating Income (Loss) | (741) | (728) |
Corporate and Other | ||
Corporate and Other | ||
Revenues | 0 | 0 |
Operating Income (Loss) | $ (2,338) | $ (1,697) |
REORGANIZATION OF BUSINESS (Narrative) (Details) $ in Thousands |
3 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
position
| |
Restructuring and Related Activities [Abstract] | |
Number of positions eliminated (in position) | position | 17 |
Total restructuring charges | $ 1,904 |
Remaining restructuring costs | $ 500 |
REORGANIZATION OF BUSINESS (Restructuring by Statement of Operations Location) (Details) $ in Thousands |
3 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | $ 1,904 |
Cost of product revenue | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | 40 |
General and administrative | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | 1,767 |
Sales and marketing | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | $ 97 |
REORGANIZATION OF BUSINESS (Restructuring by Segment) (Details) $ in Thousands |
3 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | $ 1,904 |
Operating Segments | Orion U.S. Markets | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | 0 |
Operating Segments | Orion Engineered Systems | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | 0 |
Operating Segments | Orion Distribution Services | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | 75 |
Corporate and Other | |
Restructuring Cost and Reserve [Line Items] | |
Total restructuring charges | $ 1,829 |
REORGANIZATION OF BUSINESS (Change in Reserve) (Details) $ in Thousands |
3 Months Ended |
---|---|
Jun. 30, 2017
USD ($)
| |
Restructuring Reserve | |
Beginning balance | $ 0 |
Additions | 1,904 |
Amounts Used | (1,304) |
Ending balance | 600 |
Employee separation costs | |
Restructuring Reserve | |
Beginning balance | 0 |
Additions | 1,763 |
Amounts Used | (1,304) |
Ending balance | 459 |
Post-employment medical benefits | |
Restructuring Reserve | |
Beginning balance | 0 |
Additions | 141 |
Amounts Used | 0 |
Ending balance | $ 141 |
Medical benefit period | 12 years |
Estimated health care cost trend | 6.80% |
Ultimate estimated health care cost trend | 5.00% |
Period for change in health care cost trend to reach ultimate trend rate | 9 years |
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