What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-05-11 compared with 2022-02-09 · 212 added, 98 removed, 430 unchanged (42% of the section changed)

42 unchanged sentences

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except for per share data)

For the three months ended

Three months ended

Six months ended

Cost of sales:

6 unchanged sentences

Other income (expense):

Foreign exchange loss

Foreign exchange gain (loss)

Interest expense

7 unchanged sentences

Net income (loss) attributable to common shareholders

Net (loss) income per share - basic

Net income (loss) per share - basic

Weighted average shares outstanding – basic

Net (loss) income per share - diluted

Net income (loss) per share - diluted

Weighted average shares outstanding – diluted

1 unchanged sentence

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(Amounts in thousands)

For the three months ended

Net (loss) income

Foreign currency translation gain adjustments, net

Three months ended

Six months ended

Net income (loss)

Foreign currency translation (loss) gain adjustments, net

Total comprehensive (loss) income

1 unchanged sentence

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

For the three months ended December 31, 2021 and 2020:

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

For the three months ended March 31, 2022 and 2021:

(Amounts in thousands, except per share data)

1 unchanged sentence

Shareholders’

For the Three Months Ended December 31, 2020:

Balance as of September 30, 2020

Other comprehensive gain

Three Months Ended March 31, 2022:

Balance as of December 31, 2021

Other comprehensive loss

Stock-based compensation

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Purchase of common stock

Balance as of March 31, 2022

comprehensive

Shareholders’

Three Months Ended March 31, 2021:

Balance as of December 31, 2020

Other comprehensive income

Stock-based compensation

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Balance as of March 31, 2021

See accompanying notes to unaudited condensed consolidated financial statements.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

For the six months ended March 31, 2022 and 2021:

(Amounts in thousands, except per share data)

comprehensive

Shareholders’

For the Three Months Ended December 31, 2021:

Six months ended March 31, 2022:

Balance as of September 30, 2021

Other comprehensive gain

Other comprehensive loss

Stock-based compensation

Restricted stock cancellation

Balance as of December 31, 2021

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Purchase of common stock

Balance as of March 31, 2022

comprehensive

Shareholders’

Six months ended March 31, 2021:

Balance as of September 30, 2020

Other comprehensive income

Stock-based compensation

Restricted stock issuance

Issuance of shares under employee stock purchase plan

Balance as of March 31, 2021

See accompanying notes to unaudited condensed consolidated financial statements.

AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands)

For the three months ended

Six months ended

Operating activities

Net (loss) income

Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

Amortization of intangibles

Foreign exchange loss

Loss on sale of fixed assets, net

Foreign exchange (gain) loss

Provision for losses on accounts receivable

6 unchanged sentences

Changes in operating assets and liabilities:

(Increase) decrease in accounts receivable

Increase in inventories

(Increase) decrease in refundable income taxes

Decrease (increase) in accounts receivable

Increase in life insurance receivable

(Increase) decrease in inventories

Increase in refundable income taxes

(Increase) decrease in operating lease right-of-use assets

(Increase) decrease in other assets

Decrease (increase) in other assets

Decrease in investment in lease

Decrease in long-term receivable

Decrease (increase) in long-term receivable

(Decrease) increase in accounts payable and accrued expenses

3 unchanged sentences

(Decrease) increase in pension and retirement plans liabilities

Decrease in other long-term liabilities

Net cash (used in) provided by operating activities

(Decrease) increase in other long-term liabilities

Net cash provided by operating activities

Investing activities

7 unchanged sentences

Principal payments on finance leases

Purchase of common stock

Proceeds from issuance of shares under equity compensation plans

Net cash used in financing activities

Effects of exchange rate on cash

Net (decrease) increase in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents beginning of period

9 unchanged sentences

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED DECEMBER 31, 2021

FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 2022

Organization and Business

9 unchanged sentences

All adjustments were of a normal recurring nature.

Certain information and footnote disclosures normally included in the annual consolidatd financial statements, which are prepared in accordance with accounting principles generally accepted in the United States, have been omitted.

Certain information and footnote disclosures normally included in the annual consolidated financial statements, which are prepared in accordance with accounting principles generally accepted in the United States, have been omitted.

Accordingly, the Company believes that although the disclosures are adequate to make the information presented not misleading, the unaudited condensed consolidated financial statements should be read in conjunction with the notes contained in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2021.

4 unchanged sentences

Recent Accounting Pronouncements

New accounting standards not adopted as of December 31, 2021

New accounting standards not adopted as of March 31, 2022

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326) , an amendment of the FASB Accounting Standards Codification.

36 unchanged sentences

Technology Solutions Segment

For the three months ended December 31,

Three months ended March 31,

(Amounts in thousands)

Technology Solutions Segment

For the three months ended December 31,

Three months ended March 31,

(Amounts in thousands)

Technology Solutions Segment

Six months ended March 31,

(Amounts in thousands)

Technology Solutions Segment

Six months ended March 31,

(Amounts in thousands)

* Finance revenue is related to equipment leasing and is not subject to the guidance on revenue from contracts with customers (ASC 606).

27 unchanged sentences

When we have the right to bill a customer, accounts receivable is recorded as an unconditional right exists.

Current contract assets were $ 2.6 million and $ 2.7 million as of December 31, 2021 and September 30, 2021, respectively.

Current contract assets were $ 1.7 million and $ 2.7 million as of March 31, 2022 and September 30, 2021, respectively.

The current portion is recorded in other current assets on the condensed consolidated balance sheets.

There were no noncurrent contract assets as of December 31, 2021 and September 30, 2021.

There were no noncurrent contract assets as of March 31, 2022 and September 30, 2021.

The difference in the balances is due to regular timing differences between when work is performed and having an unconditional right to payment.

Contract liabilities arise when payment is received before we transfer a good or service to the customer.

Current contract liabilities were $ 2.2 million and $ 1.9 million as of December 31, 2021 and September 30, 2021, respectively.

Current contract liabilities were $ 2.7 million and $ 1.9 million as of March 31, 2022 and September 30, 2021, respectively.

The current portion of contract liabilities is recorded in deferred revenue on the condensed consolidated balance sheets.

The long-term portion of contract liabilities were $ 0.3 million and $ 0.4 million as of December 31, 2021 and September 30, 2021, respectively.

The long-term portion of contract liabilities were $ 0.1 million and $ 0.4 million as of March 31, 2022 and September 30, 2021, respectively.

These noncurrent liabilities are recorded in other noncurrent liabilities on the condensed consolidated balance sheets.

Revenue recognized for the three months ended December 31, 2021 that was included in contract liabilities as of September 30, 2021 was $ 0.4 million.

Revenue recognized for the six months ended March 31, 2022 that was included in contract liabilities as of September 30, 2021 was $ 0.7 million.

Contract Costs

4 unchanged sentences

Incremental costs are related to commissions in the TS portion of the business.

Current capitalized contract costs are within the other current assets on the condensed consolidated balance sheets as of December 31, 2021 and September 30, 2021.

The portion of current capitalized costs were $ 116 thousand and $ 137 thousand as of December 31, 2021 and September 30, 2021, respectively.

Current capitalized contract costs are within the other current assets on the condensed consolidated balance sheets as of March 31, 2022 and September 30, 2021.

The portion of current capitalized costs were $ 121 thousand and $ 137 thousand as of March 31, 2022 and September 30, 2021, respectively.

There are no noncurrent capitalized costs on the condensed consolidated balance sheets as these commissions are paid annually even when the contract extends beyond a one year period.

The amount of incremental costs amortized for the three months ended December 31, 2021 and 2020 were $ 90 thousand and $ 87 thousand, respectively.

The amount of incremental costs amortized for the three months ended March 31, 2022 and 2021 were $ 91 thousand and $ 84 thousand, respectively.

The amount of incremental costs amortized for the six months ended March 31, 2022 and 2021 were $ 181 thousand and $ 171 thousand, respectively.

This is recorded in selling, general, and administrative expenses.

There was no impairment related to incremental costs capitalized during the three months ended December 31, 2021.

There was no impairment related to incremental costs capitalized during the three months ended March 31, 2022.

Costs to fulfill a contract are capitalized when the costs are related to a contract or anticipated contract, generate or enhance resources that will be used in satisfying performance obligations in the future, and costs are recoverable.

1 unchanged sentence

Current capitalized fulfillment costs are in the other current assets and noncurrent costs are in other assets on the condensed consolidated balance sheets.

The portion of current capitalized costs were $ 13 thousand as of December 31, 2021 and $ 13 thousand as of September 30, 2021.

The portion of noncurrent capitalized costs were $ 6 thousand and $ 9 thousand as of December 31, 2021 and September 30, 2021, respectively.

The amount of fulfillment costs amortized for the three months ended December 31, 2021 and 2020 were $ 3 thousand and $ 3 thousand, respectively.

The portion of current capitalized costs were $ 13 thousand as of March 31, 2022 and $ 13 thousand as of September 30, 2021.

The portion of noncurrent capitalized costs were $ 3 thousand and $ 9 thousand as of March 31, 2022 and September 30, 2021, respectively.

The amount of fulfillment costs amortized for the three months ended March 31, 2022 and 2021 were $ 3 thousand and $ 3 thousand, respectively.

The amount of fulfillment costs amortized for the six months ended March 31, 2022 and 2021 were $ 6 thousand and $ 6 thousand, respectively.

These costs amortized were recorded in cost of sales.

There was no impairment related to fulfillment costs capitalized in the three months ended December 31, 2021 or September 30, 2021.

There was no impairment related to fulfillment costs capitalized as of March 31, 2022 or September 30, 2021.

Projects are typically billed upon completion or at certain milestones.

10 unchanged sentences

Managed service contracts are generally longer than one year.

For these contracts the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied as of December 31, 2021 is set forth in the table below:

For these contracts the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied as of March 31, 2022 is set forth in the table below:

(Amounts in thousands)

Earnings Per Share of Common Stock

Basic net (loss) income per common share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding for the period.

Diluted net income (loss) per common share reflects the maximum dilution that would have resulted from the assumed exercise and share repurchase related to dilutive stock options and is computed by dividing net income (loss) by the assumed weighted average number of common shares outstanding.

Basic net income (loss) per common share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding for the period.

Diluted net income (loss) per

common share reflects the maximum dilution that would have resulted from the assumed exercise and share repurchase related to dilutive stock options and is computed by dividing net income (loss) by the assumed weighted average number of common shares outstanding.

We are required to present earnings per share (“EPS”), utilizing the two class method because we had outstanding, non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, which are considered participating securities.

Basic and diluted earnings per share computations for the Company’s reported net loss attributable to common stockholders are as follows:

For the three months ended

Net (loss) income

net (loss) income attributable to nonvested common stock

Net (loss) income attributable to common shareholders

Three months ended

Six months ended

(Amounts in thousands except per share data)

Net income (loss)

net income attributable to nonvested common stock

Net income (loss) attributable to common shareholders

Weighted average total shares outstanding – basic

3 unchanged sentences

Weighted average common shares outstanding – diluted

Net (loss) income per share - basic

Net (loss) income per share - diluted

Non-vested restricted stock awards of 194 thousand shares were excluded from the diluted loss per share calculation for the three months ended December 31, 2021.

Net income (loss) per share - basic

Net income (loss) per share - diluted

There are no outstanding stock options as of March 31, 2022 as they expired in the second quarter of fiscal year 2022.

Non-vested restricted stock awards of 218 thousand shares were excluded from the diluted loss per share calculation for the three months ended March 31, 2021.

Non-vested restricted stock awards of 218 thousand shares were excluded from the diluted loss per share calculation for the six months ended March 31, 2022.

These awards were excluded because there was a net loss for this period and their inclusion would have been anti-dilutive.

2 unchanged sentences

This financing is separate from agreements with a leasing component, see Note 8, “Leases” for financing through leases.

These receivables are included in Accounts receivable and Long-term receivable in the amount of $ 5.2 million and $ 5.6 million as of December 31, 2021.

These receivables are included in Accounts receivable and Long-term receivable in the amount of $ 5.5 million and $ 5.3 million as of March 31, 2022.

These receivables are included in Accounts receivable and Long-term receivable in the amount of $ 6.5 million and $ 7.5 million as of September 30, 2021, respectively.

1 unchanged sentence

There is not an allowance for credit losses nor impairments for accounts and long-term receivables with a contractual maturity of over one year.

All accounts have no past amounts due as of December 31, 2021 or September 30, 2021.

There was no activity in the allowance for credit losses of these receivables for the three months ended December 31, 2021 and 2020, respectively.

All accounts have no past amounts due as of March 31, 2022 or September 30, 2021.

There was no activity in the allowance for credit losses of these receivables for the six months ended March 31, 2022 and 2021, respectively.

All these agreements are looked at as one portfolio in determining credit losses.

5 unchanged sentences

It was determined we were acting as the agent in the transactions and recorded net revenue of approximately $ 0.1 million during the first quarter of fiscal year 2022.

The amount of interest income earned from sales whose payment terms exceed one year for the three months ended December 31, 2021 and 2020 was $ 139 thousand and $ 92 thousand, respectively.

The amount of interest income earned from sales whose payment terms exceed one year for the three months ended March 31, 2022 and 2021 was $ 122 thousand and $ 126 thousand, respectively.

The amount of interest income earned from sales whose payment terms exceed one year for the six months ended March 31, 2022 and 2021 was $ 261 thousand and $ 218 thousand, respectively.

Interest income from these agreements is recorded in Other income (expense), net on the Condensed Consolidated Statements of Operations.

16 unchanged sentences

Information related to both lessee and lessor

The components of lease costs for the three months ended December 31, 2021 and 2020 are as follows:

The components of lease costs for the three months ended March 31, 2022 and 2021 are as follows:

Three months ended

Consolidated Consolidated Statements of Operations Location

December 31, 2021

December 31, 2020

Condensed Consolidated Statements of Operations Location

March 31, 2022

March 31, 2021

(Amounts in thousands)

10 unchanged sentences

Total lease costs, net of sublease interest income

Supplemental cash flow information related to leases for three months ended December 31, 2021 and 2020 is below:

The components of lease costs for the six months ended March 31, 2022 and 2021 are as follows:

Six months ended

Condensed Consolidated Statements of Operations Location

March 31, 2022

March 31, 2021

(Amounts in thousands)

Finance Lease:

Interest on lease liabilities

Interest expense

Operating Lease:

Operating lease cost

Selling, general, and administrative

Short-term lease cost

Selling, general, and administrative

Total lease costs

Less sublease interest income

Total lease costs, net of sublease interest income

Supplemental cash flow information related to leases for three months ended March 31, 2022 and 2021 is below:

Three months ended

December 31, 2021

December 31, 2020

March 31, 2022

March 31, 2021

(Amounts in thousands)

7 unchanged sentences

Cash received from subleases

Supplemental cash flow information related to leases for six months ended March 31, 2022 and 2021 is below:

Six months ended

March 31, 2022

March 31, 2021

(Amounts in thousands)

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Operating cash flows from short-term leases

Operating cash flows from finance leases

Financing cash flows from finance leases

Lease assets obtained in exchange for new lease liabilities

Cash received from subleases

Accounts payable and other noncurrent liabilities

5 unchanged sentences

The rate was determined primarily based on the rate the Company could obtain by financing from other sources at the date of the transaction.

Interest expense related to these agreements for the three months ended December 31, 2021 was $ 74 thousand.

There was no interest expense during the three months ended December 31, 2020 due to these agreements being effective in the second quarter of fiscal year 2021.

Interest expense related to these agreements for the three months ended March 31, 2022 and 2021 was $ 72 thousand and $ 28 thousand, respectively.

Interest expense related to these agreements for the six months ended March 31, 2022 and 2021 was $ 146 thousand and $ 28 thousand, respectively.

The amounts owed for these agreements are in accounts payable and other noncurrent liabilities because they are owed to vendors rather than banks or financial institutions for borrowings.

1 unchanged sentence

Below are details of the agreements with the vendors that contain imputed interest:

December 31, 2021

March 31, 2022

March 31, 2021

(Amounts in thousands)

1 unchanged sentence

Other noncurrent liabilities

The Company had a total of approximately $ 9.4 million due to one of these vendors as of December 31, 2021.

The Company had a total of approximately $ 6.6 million due to one of these vendors as of March 31, 2022.

This is approximately 45 % of Accounts payable and other noncurrent liabilities.

15 unchanged sentences

In November 2020, the SBA Loans were formally forgiven.

The $ 2.2 million gain is presented on the Condensed Consolidated Statement of Operations as Gain on forgiveness of debt for the three months ended December 31, 2020.

Interest expense related to the notes for the three months ended December 31, 2021 and 2020 was $ 14 thousand and $ 23 thousand, respectively.

December 31, 2021

The $ 2.2 million gain is presented on the Condensed Consolidated Statement of Operations as Gain on forgiveness of debt for the six months ended March 31, 2021.

Interest expense related to the notes for the three months ended March 31, 2022 and 2021 was $ 13 thousand and $ 23 thousand, respectively.

Interest expense related to the notes for the six months ended March 31, 2022 and 2021 was $ 27 thousand and $ 46 thousand, respectively.

March 31, 2022

September 30, 2021

4 unchanged sentences

Notes payable - noncurrent portion

As of December 31, 2021 and September 30, 2021, the Company maintained an inventory line of credit with a borrowing capacity of $ 15.0 million.

As of March 31, 2022 and September 30, 2021, the Company maintained an inventory line of credit with a borrowing capacity of $ 15.0 million.

It may be used by the TS and HPP segments in the U.S.

3 unchanged sentences

(1) a minimum current ratio of 1.2 , (2) tangible net worth of no less than $ 4.0 million, and (3) a maximum ratio of total liabilities to total net worth of less than 5.0 :1.

As of December 31, 2021 and September 30, 2021, Company borrowings, all from the TS segment, under the inventory line of credit were $ 1.1 million and $ 0.9 million, respectively, and the Company was in compliance with all financial covenants.

As of December 31, 2021 and September 30, 2021, this line of credit also includes availability of a limited cash withdrawal of up to $ 1.0 million.

As of December 31, 2021 and September 30, 2021 there were no cash withdrawals outstanding.

As of March 31, 2022 and September 30, 2021, Company borrowings, all from the TS segment, under the inventory line of credit were $ 0.9 million and $ 0.9 million, respectively, and the Company was in compliance with all financial covenants.

As of March 31, 2022 and September 30, 2021, this line of credit also includes availability of a limited cash withdrawal of up to $ 1.0 million.

As of March 31, 2022 and September 30, 2021 there were no cash withdrawals outstanding.

Pension and Retirement Plans

4 unchanged sentences

supplemental retirement plans have life insurance policies which are not plan assets but were purchased by the Company as a vehicle to fund the costs of the plan.

A gain on a life insurance policy of $ 0.1 million occurred during the second quarter of fiscal year 2022.

The life insurance policy was not a current employee at time of expiration.

The Company is due $ 322 thousand from the life insurance policy, which will be paid during Q3 of fiscal year 2022.

This receivable is on the Condensed Consolidated Balance Sheet in the financial statement line item Accounts receivable, net.

The Company also provides for officer death benefits through post-retirement plans to certain officers of the Company in the U.S.

7 unchanged sentences

plans are as follows:

Three Months Ended December 31,

Three Months Ended March 31,

(Amounts in thousands)

2 unchanged sentences

Amortization of past service costs

Amortization of net gain

Amortization of net loss

Net periodic benefit cost

3 unchanged sentences

Net periodic cost

Six Months Ended March 31,

(Amounts in thousands)

Interest cost

Expected return on plan assets

Amortization of past service costs

Amortization of net loss

Net periodic benefit cost

Post Retirement:

Interest cost

Amortization of net (gain) loss

Net periodic cost

The fair value of the assets held by the U.K.

1 unchanged sentence

Fair Values as of

December 31, 2021

March 31, 2022

September 30, 2021

5 unchanged sentences

Total plan assets

An income tax expense of $ 12 thousand was recorded for the three months ended December 31, 2021 compared to an income tax expense of $ 110 thousand in the same period of 2020.

The income tax expense for the three months ended December 31, 2021 was primarily driven by minimum state tax expenses, as the Company continues to maintain a full valuation allowance on its operations.

The income tax expense for the three month period ended December 31, 2020 was driven by an increase in the valuation allowance against deferred tax assets in the period, offset by a benefit recorded for a change in tax law, allowing for the immediate deduction of covered expenses incurred through the Paycheck Protection Program.

We have in general historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full calendar year to ordinary income or loss for the reporting period.

However, we used a discrete effective tax rate method to calculate income taxes for the quarter ended December 31, 2021 because we determined that our ordinary income or loss cannot be reliably estimated and small changes in estimated ordinary income would result in significant changes in the estimated annual effective tax rates.

An income tax expense of $ 5 thousand was recorded for the three months ended March 31, 2022 compared to an income tax expense of $ 723 thousand in the same period of 2021.

An income tax expense of $ 17 thousand was recorded for the six months ended March 31, 2022 compared to an income tax expense of $ 833 thousand in the same period of 2021.

The income tax expense for the three and six months ended March 31, 2022 is primarily driven by minimum state tax expenses, as the Company continues to maintain a full valuation allowance on its operations.

The income tax expense for the three and six months ended March 31, 2021 was driven by an increase in the valuation allowance against deferred tax assets in the period, offset by a benefit recorded for a change in tax law, allowing for the immediate deduction of covered expenses incurred through the Paycheck Protection Program.

We have historically calculated the provision for income taxes during interim reporting periods by applying an estimate of the annual effective tax rate for the full calendar year to ordinary income or loss for the reporting period.

However, we used a discrete effective tax rate method to calculate income taxes for the quarter ended March 31, 2022 because we have determined that our ordinary income or loss cannot be reliably estimated and small changes in estimated ordinary income would result in significant changes in the estimated annual effective tax rates.

Accumulated Other Comprehensive Loss

7 unchanged sentences

Under the fair value standards fair value is based on the exit price and defined as the price that would be received to sell an asset or transfer a liability in an orderly transaction between market participants at the measurement date.

fair value measurement should reflect all the assumptions that market participants would use in pricing an asset or liability.

The fair value measurement should reflect all the assumptions that market participants would use in pricing an asset or liability.

A fair value hierarchy is established in the authoritative guidance outlined in three levels ranking from Level 1 to Level 3 with Level 1 being the highest priority.

2 unchanged sentences

unobservable inputs (e.g., a reporting entity’s or other entity’s own data)

The Company had no assets or liabilities measured at fair value on a recurring (except our pension plan assets and whole life insurance policies, see Note 11 for pension plan assets) or non-recurring basis as of December 31, 2021 or September 30, 2021.

To estimate fair value of the financial instruments below, quoted market prices are used when available and classified within Level 1.

1 unchanged sentence

If the preceding information is unavailable, we use internally generated data to estimate fair value which is classified within Level 3.

As of December 31, 2021

As of March 31, 2022

As of September 30, 2021

20 unchanged sentences

Fair value was estimated by discounting future cash flows based on the current rate the Company could get in another transaction with similar terms based on historical information.

Fair value of accounts receivable with an original maturity of one year or less and accounts payable was not materially different from their carrying values as of December 31, 2021 and September 30, 2021.

Fair value of accounts receivable with an original maturity of one year or less and accounts payable was not materially different from their carrying values as of March 31, 2022 and September 30, 2021.

Segment Information

The following tables present certain operating segment information for the three months ended December 31, 2021 and 2020.

The following tables present certain operating segment information for the three and six months ended March 31, 2022 and 2021.

Technology Solutions Segment

For the three months ended December 31,

Three months ended March 31,

(Amounts in thousands)

5 unchanged sentences

Depreciation and amortization

Technology Solutions Segment

Six months ended March 31,

(Amounts in thousands)

(Loss) income from operations

Capital expenditures

Depreciation and amortization

(Loss) income from operations

Capital expenditures

Depreciation and amortization

Income (loss) from operations consists of sales less cost of sales, engineering and development expenses, and selling, general and administrative expenses but is not affected by either other income/expense or by income taxes expense (benefit).

1 unchanged sentence

All intercompany transactions have been eliminated.

The following table lists customers from which the Company derived revenues of 10% or more of total revenues for the three months ended December 31, 2021 and 2020.

For the three months ended December 31,

The following table lists customers from which the Company derived revenues of 10% or more of total revenues for the three and six months ended March 31, 2022 and 2021.

Three months ended March 31,

Six months ended March 31,

(in millions)

Customer B had a balance of $ 10.5 million, or 40 %, of total consolidated accounts receivable and long-term receivable as of December 31, 2021.

There were no other customers with more than 10% of total consolidated accounts receivable and long-term receivable as of December 31, 2021.

We believe that the Company is not exposed to any significant credit risk with respect to the accounts receivable with any customers as of December 31, 2021.

(Amounts in millions)

Customer A had a balance of $ 9.9 million, or 44 %, of total consolidated accounts receivable and long-term receivable as of March 31, 2022.

There were no other customers with more than 10% of total consolidated accounts receivable and long-term receivable as of March 31, 2022.

We believe that the Company is not exposed to any significant credit risk with respect to the accounts receivable with any customers as of March 31, 2022.

Repurchase of Common Stock

On February 8, 2011, the Board of Directors authorized the Company to purchase up to 250 thousand additional shares of the Company's outstanding common stock at market price.

The plan does not expire.

As of May 14, 2020, we suspended our stock repurchase program until further economic clarity.

The Board of Directors approved the activation of the suspended stock repurchase program on December 29, 2021.

The Company repurchased 13 thousand shares of its outstanding common stock on the open market during the three months ended March 31, 2022.

As of March 31, 2022, approximately 181 thousand shares remain authorized to repurchase under the stock repurchase program.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements