| Consolidated Financial Statement Details |
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4.
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Consolidated financial statement details
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The following consolidated financial statement details are presented as of the period end dates indicated for the consolidated balance sheets and for each of the periods indicated for the consolidated statements of operations and comprehensive loss.
Consolidated balance sheets
Accounts receivable—net:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Trade accounts receivable
|
|
$
|
70,248
|
|
|
$
|
71,113
|
|
|
Other receivables
|
|
|
1,836
|
|
|
|
1,098
|
|
|
Allowance for doubtful accounts
|
|
|
(2,457
|
)
|
|
|
(2,292
|
)
|
|
Accounts receivable—net
|
|
$
|
69,627
|
|
|
$
|
69,919
|
|
The allowance for doubtful accounts pertains primarily to one customer previously serviced out of Dongguan China. This was provisioned as at December 29, 2019 and included with the restructuring charges in that year.
Unbilled contract assets:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Opening
|
|
$
|
26,271
|
|
|
$
|
20,405
|
|
|
Contract assets additions
|
|
|
368,142
|
|
|
|
358,043
|
|
|
Contract assets invoiced
|
|
|
(355,077
|
)
|
|
|
(352,177
|
)
|
|
Ending
|
|
$
|
39,336
|
|
|
$
|
26,271
|
|
The contract assets relating to WIP and finished goods inventory are $11,018 and $28,318 (2019 - $10,910 and $15,361), respectively.
Inventories:
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|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Raw materials
|
|
$
|
50,793
|
|
|
$
|
48,067
|
|
|
Parts and other
|
|
|
482
|
|
|
|
586
|
|
|
Provision for obsolescence (1)
|
|
|
(1,476
|
)
|
|
|
(827
|
)
|
|
Inventories
|
|
$
|
49,799
|
|
|
$
|
47,826
|
|
|
|
(1)
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The increase in the provision for obsolescence primarily pertains to customers serviced out of the Zacatecas facility. These have been provisioned and included with the restructuring charges for the planned closure of the facility. Refer to note 14 for further details.
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Property, plant and equipment—net:
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|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Cost:
|
|
|
|
|
|
|
|
|
|
Land
|
|
$
|
1,648
|
|
|
$
|
1,648
|
|
|
Buildings (b)
|
|
|
19,828
|
|
|
|
18,985
|
|
|
Machinery and equipment (a) (e)
|
|
|
44,996
|
|
|
|
42,732
|
|
|
Office furniture and equipment (c) (e)
|
|
|
949
|
|
|
|
1,005
|
|
|
Computer hardware and software (d)(e)
|
|
|
4,056
|
|
|
|
3,979
|
|
|
Leasehold improvements (e)
|
|
|
4,387
|
|
|
|
4,265
|
|
|
|
|
|
75,864
|
|
|
|
72,614
|
|
|
Less accumulated depreciation and impairment:
|
|
|
|
|
|
|
|
|
|
Land
|
|
|
—
|
|
|
|
—
|
|
|
Buildings (b)
|
|
|
(11,498
|
)
|
|
|
(10,392
|
)
|
|
Machinery and equipment (a) (e)
|
|
|
(34,182
|
)
|
|
|
(31,192
|
)
|
|
Office furniture and equipment (c) (e)
|
|
|
(455
|
)
|
|
|
(546
|
)
|
|
Computer hardware and software (d) (e)
|
|
|
(3,270
|
)
|
|
|
(3,289
|
)
|
|
Leasehold improvements (e)
|
|
|
(2,154
|
)
|
|
|
(1,885
|
)
|
|
|
|
|
(51,559
|
)
|
|
|
(47,304
|
)
|
|
Property, plant and equipment—net
|
|
$
|
24,305
|
|
|
$
|
25,310
|
|
|
|
(a)
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Included within machinery and equipment were assets under finance leases with costs of $4,852 as of January 3, 2021 and $2,275 as of December 29, 2019 and associated accumulated depreciation of $1,693 and $974 as of January 3, 2021 and December 29, 2019, respectively. The related depreciation expense for the year ended January 3, 2021 and December 29, 2019 was $719 and $565, respectively.
|
|
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(b)
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Included within buildings were assets under finance leases with costs of $9,684 and $9,082 and associated accumulated depreciation of $1,707 and $900 as of January 3, 2021 and December 29, 2019, respectively. The related depreciation expense for the year ended January 3, 2021 and December 29, 2019 was $807 and $804, respectively.
|
|
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(c)
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Included within office furniture and equipment were assets under finance leases with costs of $343 and $307 and associated accumulated depreciation of $118 and $52 as of January 3, 2021 and December 29, 2019, respectively. The related depreciation expense for the year ended January 3, 2021 and December 29, 2019 was $66 and $46, respectively.
|
|
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(d)
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Included within computer hardware were assets under finance leases with costs of $91 and $91 and associated accumulated depreciation of $81 and $51 as of January 3, 2021 and December 29, 2019, respectively. The related depreciation expense for the year ended January 3, 2021 and December 29, 2019was $30 and $31, respectively.
|
(e) Property, plant and equipment with cost of $1,884 and accumulated amortization of $1,872 was written off in 2020. Included in restructuring charges for 2020 were write down charges of $61 associated with property, plant and equipment with a cost of $101 and accumulated amortization of $40 with no future benefit related to the Zacatecas manufacturing facility (refer to note 14).
Intangible assets:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Cost:
|
|
|
|
|
|
|
|
|
|
Customer relationships
|
|
$
|
12,350
|
|
|
$
|
12,350
|
|
|
Order backlog
|
|
|
6,990
|
|
|
|
6,990
|
|
|
Trade name
|
|
|
1,300
|
|
|
|
1,300
|
|
|
Non-compete agreements
|
|
|
360
|
|
|
|
360
|
|
|
|
|
|
21,000
|
|
|
|
21,000
|
|
|
Less accumulated amortization:
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|
|
|
|
|
|
|
|
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Customer relationships
|
|
|
(2,649
|
)
|
|
|
(1,414
|
)
|
|
Order backlog
|
|
|
(6,990
|
)
|
|
|
(5,333
|
)
|
|
Trade name
|
|
|
(1,300
|
)
|
|
|
(1,300
|
)
|
|
Non-compete agreements
|
|
|
(360
|
)
|
|
|
(206
|
)
|
|
|
|
|
(11,299
|
)
|
|
|
(8,253
|
)
|
|
Intangible assets—net
|
|
$
|
9,701
|
|
|
$
|
12,747
|
|
These intangible assets arose from the acquisition of MC Assembly Holdings Inc. in November 2018 and were allocated to the following operating segments:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
U.S.
|
|
$
|
2,910
|
|
|
$
|
3,824
|
|
|
Mexico
|
|
|
6,791
|
|
|
|
8,923
|
|
|
Total
|
|
$
|
9,701
|
|
|
$
|
12,747
|
|
Amortization expense of $3,046 for the year end January 3, 2021 and $7,188 for the year ended December 29, 2019 are recorded in cost of sales in the consolidated statement of operations and comprehensive loss. Amortization expense for the next five years and thereafter is as follows:
|
2021
|
|
|
1,235
|
|
|
2022
|
|
|
1,235
|
|
|
2023
|
|
|
1,235
|
|
|
2024
|
|
|
1,235
|
|
|
2025
|
|
|
1,235
|
|
|
2025 and thereafter
|
|
|
3,526
|
|
|
Total amortization
|
|
$
|
9,701
|
|
Goodwill:
The carrying value of goodwill as at January 3, 2021 was $18,165 (December 29, 2019 – $18,165). This goodwill arose from the acquisition of MC Assembly Holdings Inc. in November 2018 and was allocated to the following operating segments that benefited from the synergies of this business combination and has not changed since the acquisition:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
U.S.
|
|
$
|
5,449
|
|
|
$
|
5,449
|
|
|
Mexico
|
|
|
12,716
|
|
|
|
12,716
|
|
|
Total
|
|
$
|
18,165
|
|
|
$
|
18,165
|
|
The carrying value of goodwill is assessed annually as well as assessed each reporting period for impairment triggers to determine whether there exists any indicators of impairment. The assessment is done at the operating segment level as the group of components (production facilities) within each operating segment all have similar economic characteristics. The Company completed its annual goodwill impairment testing as of the end of the fourth quarter of 2020 and concluded that there was no impairment of goodwill for any of its segment reporting units.
Accrued liabilities:
|
|
|
January 3,
2021
|
|
|
December 29,
2019
|
|
|
Payroll
|
|
$
|
8,084
|
|
|
$
|
5,504
|
|
|
Customer related
|
|
|
6,177
|
|
|
|
2,185
|
|
|
Deferred revenue
|
|
|
4,152
|
|
|
|
—
|
|
|
Professional services
|
|
|
1,284
|
|
|
|
612
|
|
|
Vendor related
|
|
|
904
|
|
|
|
1,742
|
|
|
Interest
|
|
|
426
|
|
|
|
483
|
|
|
Other
|
|
|
919
|
|
|
|
638
|
|
|
Total
|
|
$
|
21,946
|
|
|
$
|
11,164
|
|
Deferred Revenue is recorded when the Company invoices and becomes eligible to receive payment for goods or services prior to the transferring of goods or services to the customer under the terms of the contract (i.e., all revenue recognition criteria are not yet met), which is included within accrued liabilities. As of January 3, 2021 and December 29, 2019, the balance of deferred revenue was $4,152 and $0.0, respectively. Revenue of $2,670 was recognized during the fiscal year ended January 3, 2021. The accounts receivable balances associated with the deferred revenue invoicing was $825 as at January 3, 2021 with no corresponding deferred revenue invoices in accounts receivable as at December 29, 2019. Deferred revenue is recognized into revenue when all revenue recognition criteria are met.
Customer related accruals increased year over year due primarily to customer deposits for inventory.
Consolidated statements of operations and comprehensive loss
Interest expense:
|
|
|
Year ended
January 3,
2021
|
|
|
Year ended
December 29,
2019
|
|
|
Year ended
December 30,
2018
|
|
|
Long-term debt
|
|
$
|
4,160
|
|
|
$
|
5,672
|
|
|
$
|
1,440
|
|
|
Revolving credit facility
|
|
|
1,827
|
|
|
|
2,455
|
|
|
|
1,173
|
|
|
Amortization of deferred financing costs
|
|
|
231
|
|
|
|
176
|
|
|
|
58
|
|
|
Amortization of debt issuance costs
|
|
|
974
|
|
|
|
1,416
|
|
|
|
136
|
|
|
Obligations under finance lease
|
|
|
815
|
|
|
|
843
|
|
|
|
206
|
|
|
Other
|
|
|
42
|
|
|
|
—
|
|
|
|
104
|
|
|
Interest expense -net
|
|
$
|
8,049
|
|
|
$
|
10,562
|
|
|
$
|
3,117
|
|
|