Significant accounting policies Significant accounting policies

12 Months Ended

Jan. 31, 2018

policies [Abstract]

Use of estimates, Policy [Policy Text Block]

Use of estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles 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 the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue recognition, Policy [Policy Text Block]

Revenue recognition. The Company recognizes revenues including shipping and handling charges billed to customers, when all the following criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services have been rendered, (iii) the seller's price to the buyer is fixed or determinable, and (iv) collectability is reasonably assured. All subsidiaries of the Company, except as noted below, recognize revenues upon shipment or delivery of goods or services when title and risk of loss pass to customers.

Percentage-of-completion revenue recognition [Policy Text Block]

Percentage of completion revenue recognition. All divisions recognize revenues under the above stated revenue recognition policy except for domestic complex contracts that require periodic recognition of income. For these contracts, the Company uses the "percentage of completion" accounting method. Under this approach, income is recognized in each reporting period based on the status of the uncompleted contracts and the current estimates of costs to complete. The choice of accounting method is made at the time the contract is received based on the expected length and complexity of the project. The percentage of completion is determined by the relationship of costs incurred to the total estimated costs of the contract. Provisions are made for estimated losses on uncompleted contracts in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability, including those arising from contract penalty provisions and final contract settlements, may result in revisions to costs and income. Such revisions are recognized in the period in which they are determined. Claims for additional compensation due the Company are recognized in contract revenues when realization is probable and the amount can be reliably estimated.

Shipping and handling, Policy [Policy Text Block]

Shipping and handling. Shipping and handling costs are included in cost of sales, and the amounts invoiced to customers relating to shipping and handling are included in net sales.

Sales tax policy [Policy Text Block]

Sales tax. Sales tax is reported on a net basis in the consolidated financial statements.

Operating cycle, Policy [Policy Text Block]

Operating cycle. The length of contracts vary, but are typically less than one year. The Company includes in current assets and liabilities amounts realizable and payable in the normal course of contract completion unless completion of such contracts extends significantly beyond one year.

Consolidation, Policy [Policy Text Block]

Consolidation. The consolidated financial statements include the accounts of the Company and its domestic and foreign subsidiaries, all of which are wholly owned. All intercompany balances and transactions have been eliminated.

Translation of foreign currency policy [Policy Text Block]

Translation of foreign currency. Assets and liabilities of consolidated foreign subsidiaries are translated into U.S. dollars at exchange rates in effect at year-end. Revenues and expenses are translated at average weighted exchange rates prevailing during the year. Gains or losses on foreign currency transactions and the related tax effects are reflected in net income. The resulting translation adjustments are included in stockholders' equity as part of accumulated other comprehensive income (loss).

Contingencies, Policy [Policy Text Block]

Contingencies. The Company is subject to various legal proceedings and claims that arise in the ordinary course of business, including those involving environmental, tax, product liability and general liability claims. The Company accrues for such liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Such accruals are based on developments to date, the Company's estimates of the outcomes of these matters, and its experience in contesting, litigating and settling other similar matters. The Company does not currently anticipate the amount of any ultimate liability with respect to these matters will materially affect the Company's financial position, liquidity or future operations.

Cash and cash equivalents, Policy [Policy Text Block]

Cash and cash equivalents. All highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents. Cash and cash equivalents were $7.1 million and $7.6 million as of January31,2018 and 2017, respectively. On January 31, 2018, $0.7 million was held in the U.S. and $6.4 million was held in the foreign subsidiaries. On January 31, 2017, $0.2 million was held in the U.S. and $7.4 million was held in the foreign subsidiaries.

Accounts payable included drafts payable of less than $0.1 million for both January31,2018 and 2017.

Restricted cash, Policy [Policy Text Block]

Restricted cash. Restricted cash, held by foreign subsidiaries, was $1.2 million and $1.1 million as of January31,2018 and 2017, respectively. Restricted cash held by foreign subsidiaries related to fixed deposits that also serve as security deposits and guarantees.

Accounts receivable, Policy [Policy Text Block]

Accounts receivable. The majority of the Company's accounts receivable are due from geographically dispersed contractors and manufacturing companies. Credit is extended based on an evaluation of a customer's financial condition, including the availability of credit insurance. In the U.S., collateral is not generally required. In the U.A.E. and Saudi Arabia, letters of credit are usually obtained for significant orders. Accounts receivable are due within various time periods specified in the terms applicable to the specific customer and are stated at amounts due from customers net of an allowance for claims and doubtful accounts. The allowance for doubtful accounts is based on specifically identified amounts in customers' accounts, where future collectability is deemed uncertain. Management may exercise its judgment in adjusting the provision as a consequence of known items, such as current economic factors and credit trends. Past due trade accounts receivable balances are written off when the Company's collection efforts have been unsuccessful in collecting the amount due and the amount is deemed uncollectible. The write off is recorded against the allowance for doubtful accounts.

Concentration of credit risk, Policy [Policy Text Block]

Concentration of credit risk. The Company maintains its U.S. cash in bank deposit accounts at financial institutions that are insured by the Federal Deposit Insurance Corporation ("FDIC"). Cash balances are below FDIC limits. The Company has not experienced any losses in such accounts.

The Company has a broad customer base doing business in all regions of the U.S. as well as other areas in the world.

Accumulated other comprehensive loss, Policy [Policy Text Block]

Accumulated other comprehensive loss. Accumulated other comprehensive loss represents the change in equity from non-owner transactions and consisted of foreign currency translation, minimum pension liability and marketable securities.

(In thousands)	2017			2016
Equity adjustment foreign currency, gross		($268	)		($1,409	)
Minimum pension liability, gross	(1,307)			(1,472)
Marketable security, gross	—			142
Subtotal excluding tax effect	(1,575)			(2,739)
Tax effect of foreign exchange currency	(6)			(50)
Tax effect of minimum pension liability	115			115
Tax effect of marketable security	—			(50)
Total accumulated other comprehensive loss	($1,466)			($2,724)

Inventories, Policy [Policy Text Block]

Inventories. Inventories are stated at the lower of cost or market. Cost is determined using the first-in, first-out method for all inventories.

(In thousands)	2017	2016
Raw materials	$17,166	$13,648
Work in process	291	1,105
Finished goods	1,024	836
Subtotal	18,481	15,589
Less allowance	1,625	2,024
Inventories	$16,856	$13,565

Long-lived assets, Policy [Policy Text Block]

Long-lived assets. Property, plant and equipment are stated at cost. Interest is capitalized in connection with the construction of facilities and amortized over the asset's estimated useful life. Long-lived assets are reviewed for possible impairment whenever events indicate that the carrying amount of such assets may not be recoverable. If such a review indicates impairment, the carrying amount of such assets is reduced to an estimated fair value.

Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which range from three to 30 years. Leasehold improvements are depreciated over the remaining life of the lease or its useful life, whichever is shorter. Amortization of assets under capital leases is included in depreciation. Depreciation expense was approximately $4.9 million in 2017 and $5.3 million in 2016.

(In thousands)	2017	2016
Land, buildings and improvements	$22,796	$22,330
Machinery and equipment	47,009	44,538
Furniture, office equipment and computer systems	4,504	4,704
Transportation equipment	3,490	3,690
Subtotal	77,799	75,262
Less accumulated depreciation	43,290	38,987
Property, plant and equipment, net of accumulated depreciation	$34,509	$36,275

Impairment of long-lived assets, Policy [Policy Text Block]

Impairment of long-lived assets. The Company evaluates long-lived assets (including intangible assets) for impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. A factor considered important that could trigger an impairment review includes a year-to-date loss from operations. The Company reported a loss in 2017 and2016. An asset is considered impaired if its carrying amount exceeds the undiscounted future net cash flow the asset is expected to generate. Based on the Company's review of the projected cash flows over the remaining useful lives of the assets, management has determined that there was no impairment of long-lived assets as of January31,2018 and 2017.

Goodwill and other intangible assets with definite lives, policy [Policy Text Block]

Goodwill. The purchase price of an acquired company is allocated between intangible assets and the net tangible assets of the acquired business with the residual of the purchase price recorded as goodwill. All identifiable goodwill as of January31,2018 and 2017, is attributable to the purchase of Perma-Pipe Canada, Ltd. ("PPC"). The Company does not amortize goodwill.

(In thousands)	January 31, 2017		Foreign exchange change effect		January 31, 2018
Goodwill		$2,279		$144		$2,423

In January 2017, the Financial Accounting Standards Board ("FASB") issued authoritative guidance that simplifies the assessment of goodwill for impairment when the estimated fair value of a reporting unit is less than its carrying value by eliminating the requirement to determine the fair value of goodwill. Under the new guidance, the amount of goodwill impairment will be determined by the amount the carrying value of the reporting unit exceeds its fair value. The new guidance is effective for the Company beginning January 1, 2020, with early adoption permitted. The Company adopted this new guidance in the fourth quarter of 2016.

The Company performs an impairment assessment of goodwill annually as of January 31, or more frequently if triggering events occur, based on the estimated fair value of the related reporting unit. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. There was no impairment to goodwill in 2017 or 2016.

Other intangible assets with definite lives. The Company owns several patents including those covering features of its piping and electronic leak detection systems. Patents are capitalized and amortized on a straight-line basis over a period not to exceed the legal lives of the patents. The Company expenses costs incurred to renew or extend the term of intangible assets. Gross patents were $2.6 million as of January31,2018 and 2017. Accumulated amortization was approximately $2.4 million as of January31,2018 and 2017. Future amortization over the next five years ending January 31 will be less than $0.1 million in the years 2018 to 2022 and less than $0.1 million thereafter.

Research and development, Policy [Policy Text Block]

Research and development. Research and development expenses consist of materials, salaries and related expenses of engineering personnel and outside services for product development projects. Research and development costs are expensed as incurred. Research and development expense was approximately $0.3 million in 2017 and $0.2 million in 2016.

Income taxes, Policy [Policy Text Block]

Income taxes. Deferred income taxes have been provided for temporary differences arising from differences in the basis of assets and liabilities for tax and financial reporting purposes. Deferred income taxes on temporary differences have been recorded at the current tax rate. The Company assesses its deferred tax assets and liabilities for realizability at each reporting period.

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. For further information, see Note 10 - Income taxes in the Notes to Consolidated Financial Statements.

Net loss per common share, Policy [Policy Text Block]

Net loss per common share. Earnings per share ("EPS") is computed by dividing net loss by the weighted average number of common shares outstanding (basic). The Company reported net losses in 2017 and 2016; therefore, the diluted loss per share was identical to the basic loss per share rather than assuming conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect on earnings per share. The dilutive shares are in the following table:

Basic weighted average number of common shares outstanding (in thousands)	2017		2016
Basic weighted average number of common shares outstanding	7,680		7,488
Dilutive effect of stock options, deferred stock and restricted stock units	—		—
Weighted average number of common shares outstanding assuming full dilution	7,680		7,488
Stock options not included in the computation of diluted EPS of common stock because the option exercise prices exceeded the average market prices	139		306
Canceled options during the year	(131	)	(159	)
Stock options with an exercise price below the average stock price	219		218

Equity-based compensation, Policy [Policy Text Block]

Equity-based compensation. The Company issues various types of stock-based awards to employees and directors: restricted stock, deferred stock and stock options. Non-cash compensation expense associated with restricted stock is based on the fair value of the common stock at the date of grant, and amortized using the straight line method over the vesting period. Compensation expense associated with deferred stock which is awarded to the Board of Directors (non-employee) is based upon the fair value of the common stock at the date of grant, and since the grant vests immediately it is expensed on the date of the grant. A mark-to-market adjustment is recognized on a quarterly basis on these shares, which is booked to stock compensation expense, with the offset booked to the deferred compensation liability account. Stockcompensation expense for stock options is recognized ratably over the requisite service period of the award. The Black-Scholes option-pricing model is utilized to estimate the fair value of option awards.

Segment reporting, policy [Policy Text Block]

Segments. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker ("CODM") in making decisions regarding resource allocation and assessing performance The Company’s Chief Executive Officer is the CODM, and he uses a combination of several management reports, including the Company's financial information in determining how to allocate resources and assess performance. The Company has determined that it operates in one segment.

Fair value of financial instruments., Policy [Policy Text Block]

Fair value of financial instruments. The carrying values of cash and cash equivalents, accounts receivable and accounts payable are reasonable estimates of their fair value due to their short-term nature. The carrying amount of the Company's short-term debt, revolving line of credit and long-term debt approximate fair value because the majority of the amounts outstanding accrue interest at variable market rates.

Reclassifications, Policy [Policy Text Block]

Reclassifications. Reclassifications were made to the prior-year consolidated statement of cash flows to conform to the current-year presentations to the consolidated financial statements. A reclassification of $2.0 million was made to deferred compensation liabilities from current compensation liabilities on the balance sheet. Reclassifications were immaterial to the financial statements. In Note 7, Costs and estimated earnings on uncompleted contracts were reported on an aggregated basis instead of a net basis for the current open contracts. Prior-year presentation has been updated to reflect the amounts on a net basis, and there was no change to the consolidated financial statements. In Note 11, Retirement plans investments that are measured at fair value are now shown separately on the asset allocation level table, and there was no change to the consolidated financial statements.