Equity Method Investments

9 Months Ended

Dec. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

The Company’s investment in Lendway, Inc. - NASDAQ: LDWY ("Lendway"), formerly Insignia Systems, Inc. ("Insignia"), is accounted for under the equity method of accounting. The Company elected a three-month lag upon adoption of the equity method. On August 2, 2023, Insignia reincorporated in the state of Delaware as Lendway, Inc. Subsequent to reincorporation, Lendway sold its legacy business on August 4, 2023 to pivot the business towards non-bank lending. As of December 31, 2023, the Company owned 0.5 million Lendway shares, representing approximately 27.8% of Lendway's outstanding shares. During the three and nine months ended December 31, 2023, the Company's share of Lendway's net income for the three and nine months ended September 30, 2023 was $0.3 million and $0.8 million, respectively, principally driven by the gain recognized on the aforementioned sale of Lendway's legacy business on August 4, 2023. The Company's net investment basis in Lendway is $2.4 million as of December 31, 2023.

The Company's 20.1% investment in Cadillac Casting, Inc. ("CCI") is accounted for under the equity method of accounting. Due to the differing fiscal year-ends, the Company has elected a three-month lag to record the CCI investment at cost, with a basis difference of $0.3 million. The Company recorded income of $0.2 million and $1.5 million as its share of CCI's net income for the three and nine months ended December 31, 2023, along with a basis difference adjustment of $12.0 thousand and $37.0 thousand, respectively. The Company's net investment basis in CCI is $4.2 million as of December 31, 2023.

Summarized unaudited financial information for the Company's equity method investees for the three and nine months ended September 30, 2023 and 2022 is as follows (in thousands):


	Three Months Ended				Nine Months Ended
	September 30, 2023		September 30, 2022		September 30, 2023		September 30, 2022
Revenue	$	34,365	$	37,532	$	133,427	$	111,522
Gross Profit	2,746		4,045		18,076		13,210
Operating (loss) income	(124)		13,382		9,100		17,172
Net income	2,050		13,375		10,439		16,180
Net income attributable to Air T, Inc. stockholders	$	499	$	2,183	$	2,295	$	2,926