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(1) Description of Business and Basis of Presentation
Nature of Business
Aspen Aerogels, Inc. (the Company) is an energy technology company that designs, develops and manufactures innovative, high-performance aerogel insulation. The Company also conducts research and development related to aerogel technology supported by funding from several agencies of the U.S. government and other institutions in the form of research and development contracts.
The Company maintains its corporate offices in Northborough, Massachusetts. The Company has two wholly owned subsidiaries: Aspen Aerogels Rhode Island, LLC and Aspen Aerogels Germany, GmbH.
Unaudited Interim Financial Information
The accompanying unaudited interim consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. As such, the information included in this quarterly report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and accompanying notes in our Annual Report on Form 10-K for the year ended December 31, 2015 (the Annual Report), filed with the Securities and Exchange Commission on March 4, 2016.
In the opinion of the Company’s management, the unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments that are of a normal recurring nature and necessary for the fair statement of the Company’s financial position as of March 31, 2016 and the results of its operations and cash flows for the three months ended March 31, 2016 and 2015. The Company has evaluated events through the date of this filing.
The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016 or any other period.
There have been no changes to the Company’s significant accounting policies described in the Annual Report that have had a material impact on the Company’s consolidated financial statements and notes thereto.
Principles of Consolidation
The accompanying consolidated financial statements, which have been prepared in accordance with U.S. GAAP, include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of the consolidated financial statements requires the Company to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include allowances for doubtful accounts, sales returns and allowances, inventory valuation, the carrying amount of property and equipment, stock-based compensation and deferred income taxes. The Company evaluates its estimates and assumptions on an on-going basis using historical experience and other factors, including the current economic environment, which are believed to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets and declines in business investment increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.
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(2) Significant Accounting Policies
Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid instruments, which consist of money market accounts. All cash and cash equivalents are maintained with major financial institutions in North America. Deposits with these financial institutions may exceed the amount of insurance provided on such deposits; however, these deposits typically may be redeemed upon demand and, therefore, bear minimal risk.
Deferred Revenue
The Company records deferred revenue for product sales when (i) the Company has delivered products but other revenue recognition criteria have not been satisfied, (ii) payments have been received in advance of products being delivered or (iii) amounts are billed in accordance with contractual terms in advance of products being delivered.
Stock-based Compensation
Stock-based compensation expense is measured at the grant date based on the fair value of the award. Expense is recognized on a straight-line basis over the requisite service period for all awards with service conditions. For performance-based awards, the grant date fair value is recognized as expense when the condition is probable of being achieved, and then on a graded basis over the requisite service period. The Company uses the Black-Scholes option-pricing model to determine the fair value of service-based option awards, which requires a number of complex and subjective assumptions including fair value of the underlying security, the expected volatility of the underlying security, a risk-free interest rate and the expected term of the option. The fair value of restricted stock and restricted stock unit grants is determined using the closing trading price of the Company’s common stock on the date of grant. The fair value of awards containing market conditions is determined using a Monte Carlo simulation model based upon the terms of the conditions, the expected volatility of the underlying security, and other relevant factors.
During the three months ended March 31, 2016, the Company granted 420,284 restricted common stock units (RSUs) and non-qualified stock options (NSOs) to purchase 259,469 shares of common stock to employees under the 2014 Employee, Director and Consultant Equity Incentive Plan (the 2014 Equity Plan). The employee RSUs and NSOs will vest over a three year period.
Stock-based compensation is included in cost of sales or operating expenses, as applicable, and consists of the following:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
Cost of product revenue |
$ | 192 | 191 | |||||
Research and development expenses |
140 | 172 | ||||||
Sales and marketing expenses |
261 | 230 | ||||||
General and administrative expenses |
777 | 702 | ||||||
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Total stock-based compensation |
$ | 1,370 | $ | 1,295 | ||||
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Pursuant to the “evergreen” provisions of the 2014 Equity Plan, the number of shares of common stock authorized for issuance under the plan automatically increased by 463,697 shares to 6,069,201 shares effective January 1, 2016.
As of March 31, 2016, 2,619,142 shares of common stock were reserved for issuance upon the exercise or vesting, as appropriate, of outstanding stock-based awards granted under the 2014 Equity Plan. In addition, 93,233 shares of common stock are reserved for issuance upon the exercise of outstanding stock options granted under the Company’s 2001 Equity Plan. Any cancellations or forfeitures of the options outstanding under the 2001 Equity Plan will result in the shares reserved for issuance upon exercise of such options becoming available for grant under the 2014 Equity Plan. As of March 31, 2016, there were 3,011,912 shares of common stock available for grant under the 2014 Equity Plan.
Earnings per Share
The Company calculates net loss per common share based on the weighted-average number of common shares outstanding during each period. Potential common stock equivalents are determined using the treasury stock method. The weighted-average number of common shares included in the computation of diluted net loss gives effect to all potentially dilutive common equivalent shares, including outstanding stock options, RSUs and warrants. Common equivalent shares are excluded from the computation of diluted net loss per share if their effect is antidilutive.
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 in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the Chief Executive Officer. The Company’s chief operating decision maker reviews consolidated operating results to make decisions about allocating resources and assessing performance for the entire Company. The Company views its operations and manages its business as one operating segment.
Information about the Company’s revenues, based on shipment destination or services location, is presented in the following table:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
(In thousands) | ||||||||
Revenue: |
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U.S. |
$ | 11,413 | $ | 10,684 | ||||
International |
21,408 | 12,816 | ||||||
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Total |
$ | 32,821 | $ | 23,500 | ||||
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Recently Issued Accounting Standards
In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). The amendment is to simplify several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public entities, the amendments in ASU 2016-09 are effective for interim and annual reporting periods beginning after December 15, 2016. The Company is currently assessing the impact of ASU 2016-09 on its consolidated financial statements.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (FASB ASU 2016-02). FASB ASU 2016-02 changes the accounting for leases and includes a requirement to record all leases on the consolidated balance sheets as assets and liabilities. This update is effective for fiscal years beginning after December 15, 2018. Early application is permitted. The Company has not yet selected a transition method and is evaluating the effect the updated standard will have on its consolidated financial statements and related disclosures.
In August 2015, the FASB issued a deferral of ASU 2014-09, Revenue from Contracts with Customers. The standard will eliminate the transaction- and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition. As a result of the deferral, public entities are required to apply the revenue recognition standard for annual reporting period beginning on or after December 15, 2017, including interim periods within that annual reporting period. Early application is not permitted. We have not yet selected a transition method and are evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures.
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.
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(3) Inventories
Inventories consist of the following:
March 31, 2016 |
December 31, 2015 |
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(In thousands) | ||||||||
Raw materials |
$ | 3,979 | $ | 4,432 | ||||
Finished goods |
2,160 | 2,100 | ||||||
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Total |
$ | 6,139 | $ | 6,532 | ||||
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(4) Property, Plant and Equipment, Net
Property, plant and equipment consist of the following:
March 31, 2016 |
December 31, 2015 |
Useful life |
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(In thousands) | ||||||||||
Construction in progress |
$ | 8,152 | $ | 5,138 | — | |||||
Buildings |
23,885 | 23,884 | 30 years | |||||||
Machinery and equipment |
105,177 | 104,658 | 3-10 years | |||||||
Computer equipment and software |
6,966 | 6,888 | 3 years | |||||||
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Total |
144,180 | 140,568 | ||||||||
Accumulated depreciation |
(64,641 | ) | (62,246 | ) | ||||||
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Property, plant and equipment, net |
$ | 79,539 | $ | 78,322 | ||||||
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Depreciation expense was $2.4 million and $2.2 million for the three months ended March 31, 2016 and 2015, respectively.
Construction in progress totaled $8.2 million and $5.1 million at March 31, 2016 and December 31, 2015, respectively. Construction in progress included engineering designs and other pre-construction costs for the planned manufacturing facility in Statesboro, Georgia of $4.7 million and $2.3 million at March 31, 2016 and December 31, 2015, respectively.
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(5) Accrued Expenses
Accrued expenses consist of the following:
March 31, 2016 |
December 31, 2015 |
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(In thousands) | ||||||||
Employee compensation |
$ | 2,272 | $ | 4,184 | ||||
Other accrued expenses |
1,169 | 1,384 | ||||||
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Total |
$ | 3,441 | $ | 5,568 | ||||
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(6) Commitments and Contingencies
Asset Retirement Obligation
The Company has asset retirement obligations (ARO) arising from requirements to perform certain asset retirement activities upon the termination of its Northborough, Massachusetts facility lease and upon disposal of certain machinery and equipment. The liability was initially measured at fair value and subsequently adjusted for accretion expense and changes in the amount or timing of the estimated cash flows. The corresponding asset retirement costs are capitalized as part of the carrying amount of the related long-lived asset and depreciated over the asset’s remaining useful life.
A summary of ARO activity consists of the following:
Three Months Ended March 31, 2016 |
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(In thousands) | ||||
Balance at beginning of period |
$ | 397 | ||
Settlement costs |
(156 | ) | ||
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Balance at end of period |
$ | 241 | ||
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During the three months ended March 31, 2016, the Company incurred approximately $0.2 million in settlement costs in support of completing the restoration of 31,577 square feet of space formerly utilized for manufacturing operations in the Northborough, Massachusetts facility. This manufacturing space will be vacated and returned to the landlord on or before June 30, 2016. The remaining ARO reserve totaling $0.2 million is the maximum obligation to restore the remaining space in the Northborough facility currently utilized by the Company as its corporate headquarters.
Revolving Line of Credit
The Company maintains a revolving credit facility with Silicon Valley Bank which expires on August 31, 2016. The Company may borrow up to $20 million under the facility subject to compliance with certain covenants and borrowing base limitations. At the Company’s election, the interest rate applicable to borrowings under the revolving credit facility may be based on the prime rate or LIBOR. Prime rate-based rates vary from prime rate plus 0.75% per annum to prime rate plus 1.75% per annum, while LIBOR-based rates vary from LIBOR plus 3.75% per annum to LIBOR plus 4.25% per annum. In addition, the Company is required to pay a monthly unused revolving line facility fee of 0.5% per annum of the average unused portion of the revolving credit facility. The revolving credit facility is secured by a first priority security interest in all assets of the Company, including those at the East Providence facility, except for certain exclusions.
At both March 31, 2016 and December 31, 2015, the Company had no amounts drawn on the revolving credit facility. The Company had outstanding letters of credit backed by the revolving credit facility of $2.7 million at March 31, 2016 and December 31, 2015, which reduce the funds otherwise available to the Company under the facility. Based on the available borrowing base, the effective amount available to the Company under the revolving credit facility at March 31, 2016 was $13.0 million after consideration of the $2.7 million of outstanding letters of credit. Under the revolving credit facility, the Company is required to comply with financial covenants relating to, among other items, minimum Adjusted EBITDA, maximum unfinanced capital expenditures and other non-financial covenants. At March 31, 2016, the Company was in compliance with all such financial covenants.
Letters of Credit
Pursuant to the terms of its Northborough, Massachusetts facility lease, the Company has been required to provide the landlord with letters of credit securing certain obligations. In addition, the Company has been required to provide certain customers with letters of credit securing obligations under commercial contracts. The Company had letters of credit outstanding for $2.7 million at March 31, 2016 and December 31, 2015. These letters of credit are secured by the Company’s revolving credit facility.
Litigation
The Company is, from time to time, a party to litigation that arises in the normal course of its business operations. See Part II, Item 1 (“Legal Proceedings”) of this Quarterly Report on Form 10-Q for a description of certain of the Company’s current legal proceedings. The Company is not presently a party to any litigation for which it believes a loss is probable requiring an amount to be accrued or a possible loss contingency requiring disclosure.
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(8) Income Taxes
The Company incurred net operating losses and recorded a full valuation allowance against net deferred tax assets for all periods presented. Accordingly, the Company has not recorded a provision for federal or state income taxes.
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Nature of Business
Aspen Aerogels, Inc. (the Company) is an energy technology company that designs, develops and manufactures innovative, high-performance aerogel insulation. The Company also conducts research and development related to aerogel technology supported by funding from several agencies of the U.S. government and other institutions in the form of research and development contracts.
The Company maintains its corporate offices in Northborough, Massachusetts. The Company has two wholly owned subsidiaries: Aspen Aerogels Rhode Island, LLC and Aspen Aerogels Germany, GmbH.
Unaudited Interim Financial Information
The accompanying unaudited interim consolidated financial statements include the accounts of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and disclosures normally included in the consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. As such, the information included in this quarterly report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and accompanying notes in our Annual Report on Form 10-K for the year ended December 31, 2015 (the Annual Report), filed with the Securities and Exchange Commission on March 4, 2016.
In the opinion of the Company’s management, the unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and include all adjustments that are of a normal recurring nature and necessary for the fair statement of the Company’s financial position as of March 31, 2016 and the results of its operations and cash flows for the three months ended March 31, 2016 and 2015. The Company has evaluated events through the date of this filing.
The results of operations for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for the year ending December 31, 2016 or any other period.
There have been no changes to the Company’s significant accounting policies described in the Annual Report that have had a material impact on the Company’s consolidated financial statements and notes thereto.
Principles of Consolidation
The accompanying consolidated financial statements, which have been prepared in accordance with U.S. GAAP, include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates
The preparation of the consolidated financial statements requires the Company to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject to such estimates and assumptions include allowances for doubtful accounts, sales returns and allowances, inventory valuation, the carrying amount of property and equipment, stock-based compensation and deferred income taxes. The Company evaluates its estimates and assumptions on an on-going basis using historical experience and other factors, including the current economic environment, which are believed to be reasonable under the circumstances. Management adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets and declines in business investment increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods.
Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid instruments, which consist of money market accounts. All cash and cash equivalents are maintained with major financial institutions in North America. Deposits with these financial institutions may exceed the amount of insurance provided on such deposits; however, these deposits typically may be redeemed upon demand and, therefore, bear minimal risk.
Deferred Revenue
The Company records deferred revenue for product sales when (i) the Company has delivered products but other revenue recognition criteria have not been satisfied, (ii) payments have been received in advance of products being delivered or (iii) amounts are billed in accordance with contractual terms in advance of products being delivered.
Stock-based Compensation
Stock-based compensation expense is measured at the grant date based on the fair value of the award. Expense is recognized on a straight-line basis over the requisite service period for all awards with service conditions. For performance-based awards, the grant date fair value is recognized as expense when the condition is probable of being achieved, and then on a graded basis over the requisite service period. The Company uses the Black-Scholes option-pricing model to determine the fair value of service-based option awards, which requires a number of complex and subjective assumptions including fair value of the underlying security, the expected volatility of the underlying security, a risk-free interest rate and the expected term of the option. The fair value of restricted stock and restricted stock unit grants is determined using the closing trading price of the Company’s common stock on the date of grant. The fair value of awards containing market conditions is determined using a Monte Carlo simulation model based upon the terms of the conditions, the expected volatility of the underlying security, and other relevant factors.
During the three months ended March 31, 2016, the Company granted 420,284 restricted common stock units (RSUs) and non-qualified stock options (NSOs) to purchase 259,469 shares of common stock to employees under the 2014 Employee, Director and Consultant Equity Incentive Plan (the 2014 Equity Plan). The employee RSUs and NSOs will vest over a three year period.
Stock-based compensation is included in cost of sales or operating expenses, as applicable, and consists of the following:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
Cost of product revenue |
$ | 192 | 191 | |||||
Research and development expenses |
140 | 172 | ||||||
Sales and marketing expenses |
261 | 230 | ||||||
General and administrative expenses |
777 | 702 | ||||||
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Total stock-based compensation |
$ | 1,370 | $ | 1,295 | ||||
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Pursuant to the “evergreen” provisions of the 2014 Equity Plan, the number of shares of common stock authorized for issuance under the plan automatically increased by 463,697 shares to 6,069,201 shares effective January 1, 2016.
As of March 31, 2016, 2,619,142 shares of common stock were reserved for issuance upon the exercise or vesting, as appropriate, of outstanding stock-based awards granted under the 2014 Equity Plan. In addition, 93,233 shares of common stock are reserved for issuance upon the exercise of outstanding stock options granted under the Company’s 2001 Equity Plan. Any cancellations or forfeitures of the options outstanding under the 2001 Equity Plan will result in the shares reserved for issuance upon exercise of such options becoming available for grant under the 2014 Equity Plan. As of March 31, 2016, there were 3,011,912 shares of common stock available for grant under the 2014 Equity Plan.
Earnings per Share
The Company calculates net loss per common share based on the weighted-average number of common shares outstanding during each period. Potential common stock equivalents are determined using the treasury stock method. The weighted-average number of common shares included in the computation of diluted net loss gives effect to all potentially dilutive common equivalent shares, including outstanding stock options, RSUs and warrants. Common equivalent shares are excluded from the computation of diluted net loss per share if their effect is antidilutive.
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 in making decisions on how to allocate resources and assess performance. The Company’s chief operating decision maker is the Chief Executive Officer. The Company’s chief operating decision maker reviews consolidated operating results to make decisions about allocating resources and assessing performance for the entire Company. The Company views its operations and manages its business as one operating segment.
Information about the Company’s revenues, based on shipment destination or services location, is presented in the following table:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
(In thousands) | ||||||||
Revenue: |
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U.S. |
$ | 11,413 | $ | 10,684 | ||||
International |
21,408 | 12,816 | ||||||
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Total |
$ | 32,821 | $ | 23,500 | ||||
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Recently Issued Accounting Standards
In March 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting” (“ASU 2016-09”). The amendment is to simplify several aspects of the accounting for share-based payment transactions including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. For public entities, the amendments in ASU 2016-09 are effective for interim and annual reporting periods beginning after December 15, 2016. The Company is currently assessing the impact of ASU 2016-09 on its consolidated financial statements.
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (FASB ASU 2016-02). FASB ASU 2016-02 changes the accounting for leases and includes a requirement to record all leases on the consolidated balance sheets as assets and liabilities. This update is effective for fiscal years beginning after December 15, 2018. Early application is permitted. The Company has not yet selected a transition method and is evaluating the effect the updated standard will have on its consolidated financial statements and related disclosures.
In August 2015, the FASB issued a deferral of ASU 2014-09, Revenue from Contracts with Customers. The standard will eliminate the transaction- and industry-specific revenue recognition guidance under current U.S. GAAP and replace it with a principle based approach for determining revenue recognition. As a result of the deferral, public entities are required to apply the revenue recognition standard for annual reporting period beginning on or after December 15, 2017, including interim periods within that annual reporting period. Early application is not permitted. We have not yet selected a transition method and are evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures.
From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption.
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Stock-based compensation is included in cost of sales or operating expenses, as applicable, and consists of the following:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
Cost of product revenue |
$ | 192 | 191 | |||||
Research and development expenses |
140 | 172 | ||||||
Sales and marketing expenses |
261 | 230 | ||||||
General and administrative expenses |
777 | 702 | ||||||
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Total stock-based compensation |
$ | 1,370 | $ | 1,295 | ||||
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Information about the Company’s revenues, based on shipment destination or services location, is presented in the following table:
Three Months Ended March 31, |
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2016 | 2015 | |||||||
(In thousands) | ||||||||
Revenue: |
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U.S. |
$ | 11,413 | $ | 10,684 | ||||
International |
21,408 | 12,816 | ||||||
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Total |
$ | 32,821 | $ | 23,500 | ||||
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Inventories consist of the following:
March 31, 2016 |
December 31, 2015 |
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(In thousands) | ||||||||
Raw materials |
$ | 3,979 | $ | 4,432 | ||||
Finished goods |
2,160 | 2,100 | ||||||
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Total |
$ | 6,139 | $ | 6,532 | ||||
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Property, plant and equipment consist of the following:
March 31, 2016 |
December 31, 2015 |
Useful life |
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(In thousands) | ||||||||||
Construction in progress |
$ | 8,152 | $ | 5,138 | — | |||||
Buildings |
23,885 | 23,884 | 30 years | |||||||
Machinery and equipment |
105,177 | 104,658 | 3-10 years | |||||||
Computer equipment and software |
6,966 | 6,888 | 3 years | |||||||
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Total |
144,180 | 140,568 | ||||||||
Accumulated depreciation |
(64,641 | ) | (62,246 | ) | ||||||
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Property, plant and equipment, net |
$ | 79,539 | $ | 78,322 | ||||||
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Accrued expenses consist of the following:
March 31, 2016 |
December 31, 2015 |
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(In thousands) | ||||||||
Employee compensation |
$ | 2,272 | $ | 4,184 | ||||
Other accrued expenses |
1,169 | 1,384 | ||||||
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Total |
$ | 3,441 | $ | 5,568 | ||||
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A summary of ARO activity consists of the following:
Three Months Ended March 31, 2016 |
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(In thousands) | ||||
Balance at beginning of period |
$ | 397 | ||
Settlement costs |
(156 | ) | ||
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Balance at end of period |
$ | 241 | ||
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