UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 2, 2015
SCHMITT INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
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Oregon |
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000-23996 |
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93-1151989 |
(State or other jurisdiction
of incorporation or organization) |
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(Commission
File Number) |
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(I.R.S. Employer
Identification Number) |
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2765 N.W. Nicolai Street
Portland, Oregon |
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97210-1818 |
(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code: (503) 227-7908
Not Applicable
Former
name or former address, if changed since last report
Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On October 2, 2015, Schmitt Industries, Inc. issued a press release entitled Schmitt Industries Announces First Quarter Fiscal 2016 Operating
Results. A copy of the press release is furnished as Exhibit 99.1 to this report.
The information contained in this Current Report shall not be
deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange Act), or incorporated by reference in any filing under the Exchange Act or the Securities Act of 1933, as amended,
except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 Press release entitled Schmitt
Industries Announces First Quarter Fiscal 2016 Operating Results.
Forward Looking Statements
Certain statements in this release, including but not limited to remarks by James A. Fitzhenry, are forward-looking statements. These statements
are based upon current expectations, estimates and projections about the Companys business that are based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks and
uncertainties that are difficult to predict. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including, but not limited to, general economic
conditions and global financial concerns, the volatility of the Companys primary markets, efforts to accelerate growth in sales of the Xact® tank monitoring systems and the ability to
satisfy expected demand, the ability to develop new products to satisfy changes in consumer demands, the intensity of competition, the effect on production time and overall costs of products if any of our primary suppliers are lost or if a primary
supplier increases the prices of raw materials or components, the ability to ramp up manufacturing to satisfy increasing demand, maintenance of a significant investment in inventories in anticipation of future sales, existing cash levels which may
not be sufficient to fund future growth, the ability to obtain financing if needed to fund operations or growth through commercial loans or capital fund raising at terms acceptable to the Company and its shareholders, fluctuations in quarterly and
annual operating results, attracting and retaining key management and qualified technical and sales personnel, changes in effective tax rates, the ability to reduce operating costs if sales decline, increased costs due to changes in securities laws
and regulations, protection of intellectual property rights, and risks from international sales and currency fluctuations.
For further information
regarding risks and uncertainties associated with the Companys business, please refer to Schmitts SEC filings, including, but not limited to, its Forms 10-K, 10-Q and 8-K.
The forward-looking statements in this release speak only as of the date on which they were made, and the Company does not undertake any obligation to update
any forward-looking statement to reflect events or circumstances after the date of this release, or for changes to this document made by wire services or internet service providers.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
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SCHMITT INDUSTRIES, INC. |
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October 2, 2015 |
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By: |
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/s/ Ann M Ferguson |
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Name: Ann M Ferguson |
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Title: Chief Financial Officer and Treasurer |
Exhibit 99.1
IMMEDIATE NEWS RELEASE
Schmitt Industries Announces First Quarter Fiscal 2016 Operating Results
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October 2, 2015 |
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NASDAQ: SMIT |
Portland, Oregon Schmitt Industries, Inc. (NASDAQ: SMIT) today announced its operating results for the quarter ended
August 31, 2015. For the three months ended August 31, 2015, total sales increased $55,096, or 1.8%, to $3,104,384 from $3,049,288 for the three months ended August 31, 2014. Net loss was $195,062, or $(0.07) per fully diluted share,
for the three months ended August 31, 2015 as compared to net income of $51,783, or $0.02 per fully diluted share, for the three months ended August 31, 2014.
Balancer segment sales focus throughout the world on end-users, rebuilders and original equipment manufacturers of grinding machines with the target
geographic markets of North America, Asia, Europe and South America. Balancer segment sales increased $87,325, or 4.7%, to $1,927,495 for the three months ended August 31, 2015 compared to $1,840,170 for the three months ended August 31,
2014, primarily due to stronger sales in North America and Europe.
The Measurement segment product line consists of SMS® and Lasercheck® laser-based surface microroughness measurement systems, Acuity®
laser-based distance measurement and dimensional sizing laser sensors, and Xact® ultrasonic-based remote tank monitoring products. Total Measurement segment sales decreased $32,229, or 2.7%,
to $1,176,889 for the three months ended August 31, 2015 compared to $1,209,118 for the three months ended August 31, 2014. This decrease is primarily due to lower sales in our SMS product line in the first quarter of Fiscal 2016 due to
the delivery and acceptance of one of our CASI® products that occurred during the first quarter of the prior year, offset by increases in revenues in other product lines within the Measurement
segment.
Gross margin for the three months ended August 31, 2015 decreased to 46.5% as compared to 48.0% for the three months ended August 31,
2014. The fluctuations in gross margin in the three months period ended August 31, 2015 compared to the same three month period in the prior fiscal year is primarily influenced by shifts in the product sales mix involving our five product
lines.
Operating expenses increased $214,326, or 15.2%, to $1,624,794 for the three months ended August 31, 2015 as compared to $1,410,468 for the
three months ended August 31, 2014. General, administrative and selling expenses increased $199,858, or 14.9%, for the three months ended August 31, 2015 as compared to the same period in the prior year primarily due to increases in sales
commissions and increases in personnel expense.
Our first quarter results primarily reflect lower sales of our SMS surface microroughness
measurement products during the summer as compared to the prior year, combined with slightly higher operating costs, commented James A. Fitzhenry, President and CEO of Schmitt Industries. We are continuing to focus on execution of our
growth strategies for our product lines as we progress through the year, Fitzhenry concluded.
About Schmitt Industries
Schmitt Industries, Inc. (the Company) designs, manufactures and sells high precision test and measurement products for two main business segments: the
Balancer Segment and the Measurement Segment. For the Balancer Segment, the Company designs, manufactures and sells computer-controlled vibration detection, balancing and process control systems for the worldwide machine tool industry, particularly
for grinding machines. For the Measurement Segment, the Company designs, manufactures and sells laser and white light sensors for distance, dimensional and area
CORPORATE
OFFICE: 2765 NW NICOLAI ST. PORTLAND, OREGON
97210 503/227-7908 FAX 503/223-1258
measurement for a wide variety of commercial applications, laser-based microroughness measurement products for the semiconductor wafer and hard disk drive industries and for other industrial
applications, laser-based surface analysis and measurement products for a variety of scientific applications, and ultrasonic measurement products that accurately measure the liquid levels of propane and diesel tanks and transmit that data via
satellite to a secure web site for display. The Company also provides sales and service for Europe and Asia through its wholly owned subsidiary, Schmitt Europe Limited (SEL), located in Coventry, England and through its sales representative office
located in Shanghai, China.
FORWARD-LOOKING STATEMENTS
Certain statements in this release, including but not limited to remarks by James A. Fitzhenry, are forward-looking statements. These statements
are based upon current expectations, estimates and projections about the Companys business that are based, in part, on assumptions made by management. These statements are not guarantees of future performance and involve risks and
uncertainties that are difficult to predict. Actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including, but not limited to, general economic
conditions and global financial concerns, the volatility of the Companys primary markets, efforts to continue to accelerate growth in sales of the Xact® tank monitoring system and the
ability to satisfy expected demand, the ability to develop new products to satisfy changes in consumer demands, the intensity of competition, the effect on production time and overall costs of products if any of our primary suppliers are lost or if
a primary supplier increases the prices of raw materials or components, the ability to ramp up manufacturing to satisfy increasing demand, maintenance of a significant investment in inventories in anticipation of future sales, existing cash levels
which may not be sufficient to fund future growth, the ability to obtain financing if needed to fund operations or growth through commercial loans or capital fund raising at terms acceptable to the Company and its shareholders, fluctuations in
quarterly and annual operating results, attracting and retaining key management and qualified technical and sales personnel, changes in effective tax rates, the ability to reduce operating costs if sales decline, increased costs due to changes in
securities laws and regulations, protection of intellectual property rights, and risks from international sales and currency fluctuations.
For further
information regarding risks and uncertainties associated with the Companys business, please refer to Schmitts SEC filings, including, but not limited to, its Forms 10-K, 10-Q and 8-K.
The forward-looking statements in this release speak only as of the date on which they were made, and the Company does not undertake any obligation to update
any forward-looking statement to reflect events or circumstances after the date of this release, or for changes to this document made by wire services or internet service providers.
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For more information contact: |
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Ann M. Ferguson, CFO and Treasurer (503)
227-7908 or visit our web site at www.schmitt-ind.com |
CORPORATE
OFFICE: 2765 NW NICOLAI ST. PORTLAND, OREGON
97210 503/227-7908 FAX 503/223-1258
SCHMITT INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
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August 31, 2015 |
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May 31, 2015 |
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ASSETS |
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Current assets |
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Cash and cash equivalents |
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$ |
1,491,823 |
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$ |
1,795,654 |
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Accounts receivable, net |
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2,604,980 |
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2,660,426 |
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Inventories |
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4,776,612 |
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4,557,567 |
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Prepaid expenses |
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146,638 |
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153,970 |
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Income taxes receivable |
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2,239 |
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1,029 |
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9,022,292 |
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9,168,646 |
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Property and equipment, net |
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1,073,513 |
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1,110,878 |
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Other assets |
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Intangible assets, net |
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796,529 |
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824,411 |
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TOTAL ASSETS |
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$ |
10,892,334 |
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$ |
11,103,935 |
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LIABILITIES & STOCKHOLDERS EQUITY |
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Current liabilities |
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Accounts payable |
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$ |
724,562 |
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$ |
834,002 |
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Accrued commissions |
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367,649 |
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284,944 |
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Accrued payroll liabilities |
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132,172 |
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140,872 |
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Other accrued liabilities |
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342,101 |
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355,513 |
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Income taxes payable |
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3,750 |
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Total current liabilities |
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1,570,234 |
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1,615,331 |
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Stockholders equity |
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Common stock, no par value, 20,000,000 shares authorized, 2,995,910 shares issued and outstanding at August 31, 2015 and
May 31, 2015 |
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10,533,523 |
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10,511,324 |
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Accumulated other comprehensive loss |
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(360,586 |
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(366,945 |
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Accumulated deficit |
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(850,837 |
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(655,775 |
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Total stockholders equity |
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9,322,100 |
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9,488,604 |
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TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |
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$ |
10,892,334 |
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$ |
11,103,935 |
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SCHMITT INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED AUGUST 31, 2015 AND 2014
(UNAUDITED)
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Three Months Ended August 31, |
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2015 |
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2014 |
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Net sales |
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$ |
3,104,384 |
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$ |
3,049,288 |
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Cost of sales |
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1,661,892 |
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1,585,721 |
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Gross profit |
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1,442,492 |
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1,463,567 |
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Operating expenses: |
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General, administration and sales |
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1,537,882 |
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1,338,024 |
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Research and development |
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86,912 |
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72,444 |
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Total operating expenses |
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1,624,794 |
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1,410,468 |
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Operating income (loss) |
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(182,302 |
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53,099 |
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Other income (loss), net |
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(5,920 |
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1,061 |
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Income (loss) before income taxes |
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(188,222 |
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54,160 |
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Provision for income taxes |
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6,840 |
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2,377 |
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Net income (loss) |
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$ |
(195,062 |
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$ |
51,783 |
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Net income (loss) per common share, basic |
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$ |
(0.07 |
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$ |
0.02 |
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Weighted average number of common shares, basic |
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2,995,910 |
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2,995,910 |
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Net income (loss) per common share, diluted |
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$ |
(0.07 |
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$ |
0.02 |
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Weighted average number of common shares, diluted |
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2,995,910 |
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2,999,172 |
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