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Note 15 - Income Taxes | 12 Months Ended
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Dec. 31, 2016
Notes to Financial Statements |
Income Tax Disclosure [Text Block] |
15. | INCOME TAXES:
The components of Income tax expense (benefit) from continuing operations are as follows (in thousands):
|  | Year Ended December 31, |
|  | 2016 |  |  | 2015 |  |  | 2014 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (740 | ) |  | $ | (5,076 | ) |  | $ | 4,336 |
State |  |  | (102 | ) |  |  | 26 |  |  |  | 334 |
Total current income tax expense (benefit) |  |  | (842 | ) |  |  | (5,050 | ) |  |  | 4,670 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (3,541 | ) |  |  | (8,855 | ) |  |  | 305 |
State |  |  | (373 | ) |  |  | 1,954 |  |  |  | (324 | )
Total deferred income tax benefit |  |  | (3,914 | ) |  |  | (6,901 | ) |  |  | (19 | )
|  | $ | (4,756 | ) |  | $ | (11,951 | ) |  | $ | 4,651 |
The difference between the Company’s effective income tax rate and the federal statutory income tax rate of 35% is explained as follows (dollar amounts in thousands):
|  | Year Ended December 31, |
|  | 2016 |  |  | 2015 |  |  | 2014 |
Income tax benefit at federal statutory rate of 35% |  | $ | (4,907 | ) |  | $ | (14,470 | ) |  | $ | (532 | )
State benefit, net of federal income tax effect |  |  | (362 | ) |  |  | (866 | ) |  |  | (96 | )
Federal and state income tax credits |  |  | (154 | ) |  |  | (6,684 | ) |  |  | (91 | )
Disallowed domestic manufacturing deduction |  |  | - |  |  |  | 630 |  |  |  | - |
Change in valuation allowance |  |  | 1,155 |  |  |  | 5,210 |  |  |  | 9 |
Uncertain income tax positions |  |  | (4 | ) |  |  | 2,082 |  |  |  | 5 |
Goodwill impairment (nondeductible) |  |  | - |  |  |  | 1,849 |  |  |  | 5,623 |
Nondeductible expenses |  |  | 63 |  |  |  | 91 |  |  |  | 207 |
Nontaxable adjustment to contingent consideration |  |  | (580 | ) |  |  | 103 |  |  |  | (611 | )
Other |  |  | 33 |  |  |  | 104 |  |  |  | 137 |
Income tax expense (benefit) |  | $ | (4,756 | ) |  | $ | (11,951 | ) |  | $ | 4,651 |
Effective income tax rate |  |  | (33.9 | ) % |  |  | (28.9 | ) % |  |  | 305.6 | %
The income tax effect of temporary differences that give rise to significant portions of deferred income tax assets and liabilities is presented below (in thousands):
|  | December 31, |
|  | 2016 |  |  | 2015 |
Deferred income tax assets: |  |  |  |  |  |  |  |
Costs and estimated earnings in excess of billings on uncompleted contracts, net |  | $ | 1,270 |  |  | $ | 2,888 |
Accrued employee benefits |  |  | 5,025 |  |  |  | 5,946 |
Inventories |  |  | 563 |  |  |  | 2,618 |
Trade receivable, net |  |  | 199 |  |  |  | 266 |
Net operating loss carryforwards |  |  | 15,637 |  |  |  | 7,843 |
Tax credit carryforwards |  |  | 5,069 |  |  |  | 4,791 |
Other assets |  |  | 1,830 |  |  |  | 2,737 |
Other |  |  | 1,018 |  |  |  | 520 |
|  |  | 30,611 |  |  |  | 27,609 |
Valuation allowance |  |  | (8,217 | ) |  |  | (7,057 | )
|  |  | 22,394 |  |  |  | 20,552 |
Deferred income tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  |  | (22,380 | ) |  |  | (24,229 | )
Intangible assets |  |  | (819 | ) |  |  | (980 | )
Prepaid expenses |  |  | (477 | ) |  |  | (467 | )
|  |  | (23,676 | ) |  |  | (25,676 | )
Net deferred income tax liabilities |  | $ | (1,282 | ) |  | $ | (5,124 | )
In assessing the ability to realize deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred income tax liabilities, projected future taxable income, taxable income in carryback periods and tax planning strategies in making this assessment. Because the Company has a recent history of generating cumulative losses, management did not consider projections of future taxable income as persuasive evidence for the recoverability of its deferred income tax assets. The Company believes it is more likely than not it will realize the benefits of its deductible differences as of December 31, 2016, net of any valuation allowance. As of December 31, 2016, the Company had approximately $40.0 million of federal net operating loss carryforwards, which expire on various dates between 2035 and 2036, and $3.3 million of federal income tax credit carryforwards, which expire on various dates between 2023 and 2036. As of December 31, 2016, the Company also had approximately $46.9 million of state net operating loss carryforwards, which expire on various dates between 2019 and 2036, and state income tax credit carryforwards of $4.2 million, which begin to expire in 2017. During the year ended December 31, 2016, the Company determined that it no longer considers the earnings of its Mexican subsidiary to be indefinitely reinvested outside the United States. This change was made to allow the Company to more efficiently manage its cash balances and working capital. The change did not have a significant effect on the Company’s income taxes. The Company files income tax returns in the United States Federal jurisdiction, in a limited number of foreign jurisdictions and in many state jurisdictions. Internal Revenue Service examinations have been completed for years prior to 2011. With few exceptions, the Company is no longer subject to United States Federal, state or foreign income tax examinations for years before 2012. A summary of the changes in the unrecognized income tax benefits is presented below (in thousands):
|  | Year Ended December 31, |
|  | 2016 |  |  | 2015 |  |  | 2014 |
Unrecognized income tax benefits, beginning of year |  | $ | 4,874 |  |  | $ | 2,313 |  |  | $ | 6,207 |
Decreases for settlements |  |  | - |  |  |  | - |  |  |  | (3,265 | )
Decreases for lapse in statute of limitations |  |  | - |  |  |  | (1,199 | ) |  |  | (115 | )
Decreases for positions taken in current year |  |  | - |  |  |  | - |  |  |  | (615 | )
Increases for positions taken in prior years |  |  | - |  |  |  | 3,716 |  |  |  | 101 |
Increases for positions taken in the current year |  |  | - |  |  |  | 44 |  |  |  | - |
Unrecognized income tax benefits, end of year |  | $ | 4,874 |  |  | $ | 4,874 |  |  | $ | 2,313 |
It is reasonably possible that the total amounts of unrecognized income tax benefits will change in the following twelve months as a result of the lapse of tax statutes of limitation; however, actual results could differ from those currently expected. Effectively all of the unrecognized income tax benefits would affect the Company’s effective income tax rate if recognized at some point in the future. The Company recognizes interest and penalties related to uncertain income tax positions in Income tax expense. As of December 31, 2016 and 2015, the Company had approximately $0.1 million of accrued interest related to uncertain income tax positions. Total interest for uncertain income tax positions did not change materially in 2016 and decreased by approximately $0.1 million in 2015 and 2014.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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