Document_and_Entity_Informatio
Document and Entity Information | 6 Months Ended | |
Mar. 31, 2015 | Apr. 30, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | HEADWATERS INC | |
Entity Central Index Key | 1003344 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -21 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 73,745,988 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q2 |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) | Mar. 31, 2015 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $79,723 | $152,542 |
Trade receivables, net | 91,366 | 119,330 |
Inventories | 63,565 | 50,633 |
Current and deferred income taxes | 11,218 | 11,076 |
Other | 12,146 | 10,536 |
Total current assets | 258,018 | 344,117 |
Property, plant and equipment, net | 182,249 | 182,111 |
Other assets: | ||
Goodwill | 175,512 | 175,586 |
Intangible assets, net | 152,812 | 159,863 |
Other | 34,645 | 34,629 |
Total other assets | 362,969 | 370,078 |
Total assets | 803,236 | 896,306 |
Current liabilities: | ||
Accounts payable | 19,820 | 27,026 |
Accrued personnel costs | 32,575 | 48,902 |
Accrued interest | 2,721 | 18,273 |
Current income taxes | 0 | 368 |
Other accrued liabilities | 37,049 | 41,757 |
Current portion of long-term debt | 3,188 | 0 |
Total current liabilities | 95,353 | 136,326 |
Long-term liabilities: | ||
Long-term debt, net | 559,129 | 592,458 |
Income taxes | 18,939 | 23,242 |
Other | 31,359 | 28,586 |
Total long-term liabilities | 609,427 | 644,286 |
Total liabilities | 704,780 | 780,612 |
Commitments and contingencies | ||
Redeemable non-controlling interest in consolidated subsidiary | 12,829 | 13,252 |
Stockholders' equity: | ||
Common stock, $0.001 par value; authorized 200,000 shares; issued and outstanding: 73,510 shares at September 30, 201 (including 61 shares held in treasury) and 73,742 shares at March 31, 2015 (including 71 shares held in treasury) | 74 | 74 |
Capital in excess of par value | 725,615 | 723,648 |
Retained earnings (accumulated deficit) | -639,306 | -620,688 |
Treasury stock | -756 | -592 |
Total stockholders' equity | 85,627 | 102,442 |
Total liabilities and stockholders' equity | $803,236 | $896,306 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Mar. 31, 2015 | Sep. 30, 2014 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, authorized shares | 200,000,000 | 200,000,000 |
Common stock, issued shares | 73,742,000 | 73,510,000 |
Common stock, outstanding shares | 73,742,000 | 73,510,000 |
Common stock, held in treasury (in shares) | 71,000 | 61,000 |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Revenue: | ||||
Total revenue | $179,725 | $156,512 | $379,322 | $322,127 |
Cost of revenue: | ||||
Total cost of revenue | 132,584 | 117,961 | 276,494 | 242,683 |
Gross profit | 47,141 | 38,551 | 102,828 | 79,444 |
Operating expenses: | ||||
Amortization | 4,560 | 5,485 | 9,046 | 10,591 |
Selling, general and administrative | 34,351 | 32,517 | 66,380 | 60,744 |
Total operating expenses | 38,911 | 38,002 | 75,426 | 71,335 |
Operating income | 8,230 | 549 | 27,402 | 8,109 |
Other income (expense): | ||||
Net interest expense | -35,965 | -12,234 | -47,917 | -22,290 |
Other, net | -33 | -32 | -302 | -20 |
Total other income (expense), net | -35,998 | -12,266 | -48,219 | -22,310 |
Loss from continuing operations before income taxes | -27,768 | -11,717 | -20,817 | -14,201 |
Income tax benefit | 2,780 | 2,210 | 2,980 | 2,560 |
Loss from continuing operations | -24,988 | -9,507 | -17,837 | -11,641 |
Income (loss) from discontinued operations, net of income taxes | -210 | -575 | -277 | 125 |
Net loss | -25,198 | -10,082 | -18,114 | -11,516 |
Net income attributable to non-controlling interest | -259 | -236 | -504 | -230 |
Net loss attributable to Headwaters Incorporated | -25,457 | -10,318 | -18,618 | -11,746 |
Basic and diluted income (loss) per share attributable to Headwaters Incorporated: | ||||
From continuing operations (in dollars per share) | ($0.34) | ($0.13) | ($0.25) | ($0.16) |
From discontinued operations (in dollars per share) | $0 | ($0.01) | $0 | $0 |
Earnings (loss) per share, basic and diluted, total (in dollars per share) | ($0.34) | ($0.14) | ($0.25) | ($0.16) |
Building Products | ||||
Revenue: | ||||
Total revenue | 106,406 | 94,139 | 223,940 | 187,151 |
Cost of revenue: | ||||
Total cost of revenue | 79,481 | 70,828 | 163,673 | 140,166 |
Construction Materials | ||||
Revenue: | ||||
Total revenue | 67,498 | 59,093 | 148,902 | 130,614 |
Cost of revenue: | ||||
Total cost of revenue | 50,738 | 45,669 | 110,249 | 100,434 |
Energy Technology | ||||
Revenue: | ||||
Total revenue | 5,821 | 3,280 | 6,480 | 4,362 |
Cost of revenue: | ||||
Total cost of revenue | $2,365 | $1,464 | $2,572 | $2,083 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (USD $) | Common stock | Capital in excess of par value | Retained earnings (accumulated deficit) | Treasury stock | Total |
In Thousands, unless otherwise specified | |||||
Balances at Sep. 30, 2014 | $74 | $723,648 | ($620,688) | ($592) | $102,442 |
Balances (in shares) at Sep. 30, 2014 | 73,510 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Issuance of common stock pursuant to employee stock purchase plan | 0 | 464 | 464 | ||
Issuance of common stock pursuant to employee stock purchase plan (in shares) | 38 | ||||
Issuance of restricted stock, net of cancellations | 0 | 0 | |||
Issuance of restricted stock, net of cancellations (in shares) | 115 | ||||
Exercise of stock appreciation rights | 0 | 0 | |||
Exercise of stock appreciation rights (in shares) | 79 | ||||
Stock-based compensation | 1,339 | 1,339 | |||
Net 10 share increase in treasury stock held for deferred compensation plan obligations, at cost | 164 | -164 | 0 | ||
Net loss attributable to Headwaters Incorporated | -18,618 | -18,618 | |||
Balances at Mar. 31, 2015 | $74 | $725,615 | ($639,306) | ($756) | $85,627 |
Balances (in shares) at Mar. 31, 2015 | 73,742 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY | |
Increase (decrease) in treasury stock held for deferred compensation plan obligations (in shares) | 10 |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 6 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||
Net loss | ($18,114) | ($11,516) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 25,856 | 26,460 |
Interest expense related to amortization of debt issue costs and debt discount | 5,042 | 1,153 |
Stock-based compensation | 1,339 | 1,016 |
Deferred income taxes | 477 | 214 |
Net loss on disposition of property, plant and equipment | 113 | 373 |
Loss (gain) on sale of discontinued operations, net of income taxes | 241 | -3,117 |
Net loss of unconsolidated joint ventures | 234 | 133 |
Decrease in trade receivables | 28,347 | 30,911 |
Increase in inventories | -10,628 | -9,754 |
Decrease in accounts payable and accrued liabilities | -47,580 | -23,598 |
Other changes in operating assets and liabilities, net | -8,769 | -5,530 |
Net cash provided by (used in) operating activities | -23,442 | 6,745 |
Cash flows from investing activities: | ||
Business acquisitions | -1,200 | -60,619 |
Investments in unconsolidated joint ventures | -125 | -1,000 |
Purchase of property, plant and equipment | -17,474 | -15,944 |
Proceeds from disposition of property, plant and equipment | 640 | 358 |
Proceeds from sale of discontinued operations | 0 | 4,666 |
Net decrease in long-term receivables and deposits | 3,650 | 5,825 |
Net change in other assets | -344 | 24 |
Net cash provided by (used in) investing activities | -14,853 | -66,690 |
Cash flows from financing activities: | ||
Net proceeds from issuance of long-term debt | 414,675 | 146,200 |
Payments on long-term debt | -448,736 | -7,792 |
Dividends paid to non-controlling interest in consolidated subsidiary | -927 | 0 |
Employee stock purchases | 464 | 454 |
Net cash provided by (used in) financing activities | -34,524 | 138,862 |
Net increase (decrease) in cash and cash equivalents | -72,819 | 78,917 |
Cash and cash equivalents, beginning of period | 152,542 | 75,316 |
Cash and cash equivalents, end of period | $79,723 | $154,233 |
Nature_of_Operations_and_Basis
Nature of Operations and Basis of Presentation | 6 Months Ended |
Mar. 31, 2015 | |
Nature of Operations and Basis of Presentation | |
Nature of Operations and Basis of Presentation | |
1.Nature of Operations and Basis of Presentation | |
Description of Business and Organization — Headwaters Incorporated (Headwaters) is a building materials company incorporated in Delaware, providing products and services in two core business segments. | |
The building products segment designs, manufactures, and sells a wide variety of building products, including exterior vinyl siding accessories (such as shutters, mounting blocks, and vents), manufactured architectural stone, roofing materials and concrete block. Revenues from Headwaters’ building products businesses are diversified geographically and also by end use, including new housing construction and residential repair and remodeling, as well as commercial construction. | |
The construction materials segment is the nationwide leader in the management and marketing of coal combustion products (CCPs), including fly ash which is primarily sold directly to concrete manufacturers who use it as a mineral admixture for the partial replacement of portland cement in concrete. Headwaters’ construction materials business is comprised of a nationwide supply, storage and distribution network. Headwaters also provides services to electric utilities related to the management of CCPs. | |
In addition to the two building materials segments described above, Headwaters also has a non-core energy technology segment which has been focused on reducing waste and increasing the value of energy-related feedstocks, primarily in the areas of low-value oil and coal. In oil, Headwaters’ heavy oil upgrading process uses a liquid catalyst precursor to generate a highly active molecular catalyst to convert low-value residual oil into higher-value distillates that can be further refined into gasoline, diesel and other products. In coal, Headwaters owned and operated coal cleaning facilities that separate ash from waste coal to provide a refined coal product that is higher in Btu value and lower in impurities than the feedstock coal. As described in Note 4, Headwaters disposed of its remaining coal cleaning facilities in January 2013 and the results of Headwaters’ coal cleaning operations have been presented as discontinued operations for all periods. | |
Basis of Presentation — Headwaters’ fiscal year ends on September 30 and unless otherwise noted, references to years refer to Headwaters’ fiscal year rather than a calendar year. The unaudited interim condensed consolidated financial statements include the accounts of Headwaters, all of its subsidiaries and other entities in which Headwaters has a controlling interest. All significant intercompany transactions and accounts are eliminated in consolidation. Due to the seasonality of most of Headwaters’ operations and other factors, the consolidated results of operations for any particular period are not indicative of the results to be expected for a full fiscal year. During the six months ended March 31, 2014, approximately 13% of Headwaters’ total revenue and cost of revenue was for services. During the six months ended March 31, 2015, approximately 10% of Headwaters’ total revenue and cost of revenue was for services. Substantially all service-related revenue for both periods was in the construction materials segment. | |
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (SEC) for quarterly reports on Form 10-Q. In the opinion of management, all adjustments considered necessary for a fair presentation have been included, which consist of normal recurring adjustments and the non-routine adjustments to account for the debt transactions described in Note 7. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted. These unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in Headwaters’ Annual Report on Form 10-K for the year ended September 30, 2014 (Form 10-K) and in Headwaters’ Quarterly Report on Form 10-Q for the quarter ended December 31, 2014. | |
Recent Accounting Pronouncements — In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2015-03, Interest–Imputation of Interest (ASC Topic 835-30). This new rule was issued to simplify the presentation of debt issue costs to require that debt issue costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issue costs were not affected by the amendments in the ASU. Early adoption of ASU 2015-03 is permitted for financial statements that have not been previously issued and Headwaters elected to adopt the ASU effective as of March 31, 2015, with retrospective application to the September 30, 2014 balance sheet. | |
The effect of the adoption of ASU 2015-03 was to reclassify debt issue costs of approximately $7.1 million as of September 30, 2014 and $10.6 million as of March 31, 2015 as a deduction from the related debt liabilities. Accordingly, other assets and total assets in the balance sheets were reduced by those amounts, and the long-term debt amounts presented in the balance sheets were reduced by the same amounts. There was no effect on net income (loss). | |
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (ASC Topic 606). This new revenue standard creates a single source of revenue guidance for all companies in all industries and is more principles-based than current revenue guidance. For Headwaters, the mandatory adoption date of ASC 606 is October 1, 2017 and there are two methods of adoption allowed, either a “full” retrospective adoption or a “modified” retrospective adoption. Headwaters is currently evaluating the impact of ASC 606, but at the current time does not know what impact the new standard will have on revenue recognized and other accounting decisions in future periods, if any, nor what method of adoption will be selected if the impact is material. | |
Headwaters has reviewed other recently issued accounting standards which have not yet been adopted in order to determine their potential effect, if any, on the results of operations or financial position of Headwaters. Based on the review of these other recently issued standards, Headwaters does not currently believe that any of those accounting pronouncements will have a significant effect on its current or future financial position, results of operations, cash flows or disclosures. | |
Reclassifications — Certain prior period amounts, including the changes described above for the accounting for debt issue costs, have been reclassified to conform to the current period’s presentation. The reclassifications had no effect on net income (loss), but the reclassification of debt issue costs did affect total assets and total liabilities. | |
Segment_Reporting
Segment Reporting | 6 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Segment Reporting | |||||||||||||||||
Segment Reporting | |||||||||||||||||
2.Segment Reporting | |||||||||||||||||
Headwaters currently operates three business segments: building products, construction materials and energy technology. These segments are managed and evaluated separately by management due to differences in their operations, products and services. Revenues for the building products segment consist of product sales to wholesale and retail distributors, contractors and other users of building products. Revenues for the construction materials segment consist primarily of CCP sales to ready-mix concrete businesses, with a smaller amount from services provided to coal-fueled electric generating utilities. Continuing revenues for the energy technology segment consist primarily of catalyst sales to oil refineries. As described in Note 4, Headwaters sold all of its coal cleaning facilities in fiscal 2012 and 2013 and the results of operations have been reflected as discontinued operations in the accompanying statements of operations for all periods. Intersegment sales are immaterial. | |||||||||||||||||
The following segment information has been prepared in accordance with ASC Topic 280 Segment Reporting. Segment performance is evaluated primarily on revenue and operating income, although other factors are also used, such as Adjusted EBITDA. Headwaters defines Adjusted EBITDA as net income plus net interest expense, income taxes, depreciation and amortization, stock-based compensation, cash-based compensation tied to stock price, goodwill and other impairments, and other non-routine adjustments that arise from time to time. | |||||||||||||||||
Segment costs and expenses considered in deriving segment operating income (loss) include cost of revenue, amortization, and segment-specific selling, general and administrative expenses. Amounts included in the Corporate column represent expenses that are not allocated to any segment and include administrative departmental costs and general corporate overhead. Segment assets reflect those specifically attributable to individual segments and primarily include cash, accounts receivable, inventories, property, plant and equipment, goodwill and intangible assets. Certain other assets are included in the Corporate column. The net operating results of the discontinued coal cleaning business are reflected in the single line item for discontinued operations. | |||||||||||||||||
Three Months Ended March 31, 2014 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 94,139 | $ | 59,093 | $ | 3,280 | $ | 0 | $ | 156,512 | |||||||
Depreciation and amortization | $ | (9,546 | ) | $ | (3,319 | ) | $ | (479 | ) | $ | (69 | ) | $ | (13,413 | ) | ||
Operating income (loss) | $ | 1,907 | $ | 5,228 | $ | (821 | ) | $ | (5,765 | ) | $ | 549 | |||||
Net interest expense | (12,234 | ) | |||||||||||||||
Other income (expense), net | (32 | ) | |||||||||||||||
Income tax benefit | 2,210 | ||||||||||||||||
Loss from continuing operations | (9,507 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (575 | ) | |||||||||||||||
Net loss | $ | (10,082 | ) | ||||||||||||||
Capital expenditures | $ | 6,864 | $ | 1,377 | $ | 75 | $ | 740 | $ | 9,056 | |||||||
Segment assets as of September 30, 2014 | $ | 411,968 | $ | 325,140 | $ | 22,674 | $ | 136,524 | $ | 896,306 | |||||||
Three Months Ended March 31, 2015 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 106,406 | $ | 67,498 | $ | 5,821 | $ | 0 | $ | 179,725 | |||||||
Depreciation and amortization | $ | (8,702 | ) | $ | (3,799 | ) | $ | (341 | ) | $ | (104 | ) | $ | (12,946 | ) | ||
Operating income (loss) | $ | 4,679 | $ | 8,175 | $ | 1,473 | $ | (6,097 | ) | $ | 8,230 | ||||||
Net interest expense | (35,965 | ) | |||||||||||||||
Other income (expense), net | (33 | ) | |||||||||||||||
Income tax benefit | 2,780 | ||||||||||||||||
Loss from continuing operations | (24,988 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (210 | ) | |||||||||||||||
Net loss | $ | (25,198 | ) | ||||||||||||||
Capital expenditures | $ | 6,131 | $ | 1,026 | $ | 61 | $ | 1,485 | $ | 8,703 | |||||||
Segment assets as of March 31, 2015 | $ | 396,568 | $ | 308,750 | $ | 27,131 | $ | 70,787 | $ | 803,236 | |||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 187,151 | $ | 130,614 | $ | 4,362 | $ | 0 | $ | 322,127 | |||||||
Depreciation and amortization | $ | (18,758 | ) | $ | (6,605 | ) | $ | (967 | ) | $ | (130 | ) | $ | (26,460 | ) | ||
Operating income (loss) | $ | 6,993 | $ | 15,161 | $ | (3,107 | ) | $ | (10,938 | ) | $ | 8,109 | |||||
Net interest expense | (22,290 | ) | |||||||||||||||
Other income (expense), net | (20 | ) | |||||||||||||||
Income tax benefit | 2,560 | ||||||||||||||||
Loss from continuing operations | (11,641 | ) | |||||||||||||||
Income from discontinued operations, net of income taxes | 125 | ||||||||||||||||
Net loss | $ | (11,516 | ) | ||||||||||||||
Capital expenditures | $ | 11,316 | $ | 2,562 | $ | 305 | $ | 1,761 | $ | 15,944 | |||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 223,940 | $ | 148,902 | $ | 6,480 | $ | 0 | $ | 379,322 | |||||||
Depreciation and amortization | $ | (17,415 | ) | $ | (7,535 | ) | $ | (694 | ) | $ | (212 | ) | $ | (25,856 | ) | ||
Operating income (loss) | $ | 16,627 | $ | 21,663 | $ | (138 | ) | $ | (10,750 | ) | $ | 27,402 | |||||
Net interest expense | (47,917 | ) | |||||||||||||||
Other income (expense), net | (302 | ) | |||||||||||||||
Income tax benefit | 2,980 | ||||||||||||||||
Loss from continuing operations | (17,837 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (277 | ) | |||||||||||||||
Net loss | $ | (18,114 | ) | ||||||||||||||
Capital expenditures | $ | 12,152 | $ | 2,374 | $ | 229 | $ | 2,719 | $ | 17,474 | |||||||
Acquisitions
Acquisitions | 6 Months Ended | ||||
Mar. 31, 2015 | |||||
Acquisitions | |||||
Acquisitions | |||||
3.Acquisitions | |||||
Entegra — On December 12, 2013, Headwaters acquired 80% of the equity interests of Roof Tile Acquisition, LLC, a privately-held Florida-based company in the building products industry, which sells its products primarily under the Entegra brand. Entegra’s results of operations have been included with Headwaters’ consolidated results beginning December 13, 2013. | |||||
Entegra is a leading manufacturer of concrete roof tiles and accessories which are sold primarily into Florida. The acquisition of Entegra provides additional product offerings to Headwaters’ current roofing products portfolio. Headwaters believes the strategic location of Entegra’s centralized manufacturing plant in Florida, the quality of its contractor/customer relationships, and the scope of its products and services provide a competitive advantage. Many of its customers are currently customers of Headwaters, and provide Headwaters the opportunity to expand existing sales and distribution within Florida, which is one of the fastest growing states in the U.S. in terms of population. | |||||
Total consideration paid for Entegra was approximately $57.5 million, all of which was cash. Direct acquisition costs, consisting primarily of fees for legal services, totaled approximately $0.4 million and were included in selling, general and administrative expense in the statement of operations for fiscal 2014. Headwaters has the right, but not the obligation, to acquire the non-controlling 20% equity interest in Entegra for a stipulated multiple of EBITDA adjusted for certain prescribed items. This call right is exercisable at any time after five years following the date of acquisition, unless certain defined events occur prior to that time, in which case the right is exercisable earlier. The non-controlling owners have the right, but not the obligation, to require Headwaters to acquire the non-controlling 20% equity interest, again for a stipulated multiple of EBITDA adjusted for certain prescribed items. This put right is exercisable at any time after 18 months following the date of acquisition, unless certain defined events under Headwaters’ control occur prior to that time, in which case the right is exercisable earlier. | |||||
The Entegra acquisition has been accounted for as a business combination in accordance with the requirements of ASC 805 Business Combinations. The following table sets forth the estimated fair values of assets acquired and liabilities assumed as of the acquisition date: | |||||
(in thousands) | |||||
Current assets | $ | 8,261 | |||
Current liabilities | (3,422 | ) | |||
Property, plant and equipment | 10,589 | ||||
Intangible assets: | |||||
Customer relationships (15 year life) | 20,600 | ||||
Trade name (indefinite life) | 6,600 | ||||
Goodwill | 28,156 | ||||
Net assets acquired | 70,784 | ||||
Less redeemable non-controlling interest | (13,252 | ) | |||
Net assets attributable to Headwaters | $ | 57,532 | |||
Entegra’s future growth attributable to new customers, geographic presence and assembled workforce are additional assets that are not separable and which contributed to recorded goodwill, most of which is tax deductible over 15 years. | |||||
Gerard — On May 16, 2014, Headwaters acquired certain assets and assumed certain liabilities of the roofing products business of Metals USA Building Products, L.P., which products are sold under the Gerard and Allmet brands. Gerard’s results of operations are being reported within the building products segment and have been included with Headwaters’ consolidated results beginning May 16, 2014. | |||||
Gerard is one of the largest manufacturers of stone coated metal roofing materials in the U.S. and sells niche roofing products that combine profiles resembling tile, shake, or slate with a fire proof material and a low lifetime installed cost. The acquisition of Gerard increases the number of specialty niche roofing products that Headwaters provides to its core customers and is an area of focus for Headwaters. With the addition of Gerard, Headwaters now has three product categories in niche roofing, including resin-based composite, concrete, and metal, which could increase opportunities for cross selling. Besides broadening the niche roofing product lines, Gerard also expands Headwaters geographic footprint in the roofing category. | |||||
Total consideration paid for Gerard was approximately $27.6 million, all of which was cash. Direct acquisition costs, consisting primarily of fees for legal services, totaled approximately $0.3 million and were included in selling, general and administrative expense in the statement of operations for fiscal 2014. | |||||
The Gerard acquisition has been accounted for as a business combination in accordance with the requirements of ASC 805 Business Combinations. The following table sets forth the estimated fair values of assets acquired and liabilities assumed as of the acquisition date, using available information and assumptions Headwaters deems to be reasonable at the current time. Headwaters is in the process of finalizing the estimated amounts shown below, including the third-party valuations of the fair values of the acquired intangible assets; therefore, the provisional measurements shown in the table are subject to change. | |||||
(in thousands) | |||||
Current assets | $ | 9,236 | |||
Current liabilities | (1,691 | ) | |||
Property, plant and equipment | 8,314 | ||||
Intangible assets: | |||||
Customer relationships (15 year life) | 4,000 | ||||
Trade name (indefinite life) | 3,900 | ||||
Goodwill | 7,719 | ||||
Long-term liabilities | (3,906 | ) | |||
Net assets acquired | $ | 27,572 | |||
The process of identifying and valuing the intangible assets that were acquired has not been completed. When this process is completed and estimated useful lives are finalized, amortization of the intangible assets will be adjusted effective as of May 16, 2014 if necessary. Gerard’s future growth attributable to new customers, geographic presence and assembled workforce are additional assets that are not separable and which contributed to recorded goodwill, most of which is tax deductible over 15 years. | |||||
Other — During the March 2014 quarter, Headwaters acquired the assets of a company in the construction materials industry located in the Northeast U.S. for initial cash consideration of approximately $3.1 million. This acquisition increased Headwaters’ supply of fly ash and bottom ash, improving its competitive position in that region. During the September 2014 quarter, Headwaters acquired the assets of another company in the construction materials industry located in the Southeast U.S. for cash consideration of approximately $7.4 million. This acquisition increased Headwaters’ supply of ash products produced by industrial boilers and has strengthened the ability to meet customers’ needs along the Gulf Coast. | |||||
Investments in entities in which Headwaters has a significant influence over operating and financial decisions are accounted for using the equity method of accounting. Headwaters acquired 100% of one such equity method investee in the December 2014 quarter for a cash payment of approximately $1.2 million. As a result of Headwaters obtaining a controlling financial interest from this transaction, the investee has been consolidated within the building products segment. | |||||
Redeemable Non-controlling Interest in Consolidated Subsidiary — As described above, Headwaters acquired 80% of the equity interests of Entegra, and the non-controlling owners have the right to require Headwaters to acquire the non-controlling 20% equity interest. This put right is not deemed to be a freestanding financial instrument and because it is not solely within the control of Headwaters, the non-controlling interest does not qualify as permanent equity and has been reported outside the stockholders’ equity section of the balance sheet as temporary, or mezzanine, equity. The value of the non-controlling interest was affected by the lack of control as well as the estimated fair values of the put and call rights. | |||||
Because there is no fixed redemption date for the put right, Headwaters compares quarterly the carrying value of the non-controlling interest to its estimated redemption value. The estimated redemption value is calculated based on the EBITDA formula described previously to determine the price that would be paid if the put right were to have been exercised at the end of the reporting period. If applicable, the carrying amount is increased, but not decreased, to the estimated redemption value. The following table summarizes the changes in carrying value of the non-controlling interest during the six months ended March 31, 2015: | |||||
(in thousands) | |||||
Balance as of September 30, 2014 | $ | 13,252 | |||
Net income attributable to non-controlling interest | 504 | ||||
Dividends paid to non-controlling interest | (927 | ) | |||
Balance as of March 31, 2015 | $ | 12,829 | |||
Discontinued_Operations
Discontinued Operations | 6 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Discontinued Operations | ||||||||||||||
Discontinued Operations | ||||||||||||||
4.Discontinued Operations | ||||||||||||||
In September 2011, the Board of Directors committed to a plan to sell Headwaters’ coal cleaning business, which was part of the energy technology segment. At that time the business met all of the criteria for classification as held for sale and presentation as a discontinued operation. Following the sale of all remaining coal cleaning facilities in January 2013, there are no remaining assets held for sale. The results of operations for the coal cleaning business have been presented as discontinued operations for all periods presented and certain summarized information for the discontinued business is presented in the following table: | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
March 31, | March 31, | |||||||||||||
(in thousands) | 2014 | 2015 | 2014 | 2015 | ||||||||||
Revenue | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||
Loss from operations of discontinued operations before income taxes | $ | (2,728 | ) | $ | (14 | ) | $ | (2,992 | ) | $ | (36 | ) | ||
Gain (loss) on disposal | 2,153 | (196 | ) | 3,117 | (241 | ) | ||||||||
Income tax provision | 0 | 0 | 0 | 0 | ||||||||||
Income (loss) from discontinued operations, net of income taxes | $ | (575 | ) | $ | (210 | ) | $ | 125 | $ | (277 | ) | |||
Headwaters sold all of its coal cleaning facilities in fiscal 2012 and 2013, and recognized estimated gains on the sales dates. Subsequent to the dates of sale, adjustments of the previously recognized estimated gains on the sales transactions have been recorded, including the reported amounts reflected in the table above. Headwaters currently expects that additional adjustments to the recognized gains and losses may be recorded in the future as certain contingencies are resolved. The loss from operations reflected in the table includes expenses for certain litigation which commenced prior to disposal of the business. | ||||||||||||||
For all sales transactions, a majority of the consideration is in the form of potential production royalties and deferred purchase price, which amounts are dependent upon future plant production levels over several years. Potential future production royalties and deferred purchase price on the sales transactions were not considered as being probable in the original gain calculations and are being accounted for in the periods when such amounts are received. | ||||||||||||||
In accordance with the terms of the asset purchase agreement for one of the sales transactions, the buyer of the coal cleaning facilities agreed to assume the lease and reclamation obligations related to certain of the facilities. Subsequent to the date of sale, the Headwaters subsidiaries which sold the facilities amended the purchase agreement to provide the buyer with additional time to make payments, as well as fulfill contractual requirements related to the assumed reclamation obligations. As of March 31, 2015, one of Headwaters’ subsidiaries anticipates that it will perform permit reclamation responsibilities at one site. Approximately $8.0 million was accrued in prior periods to satisfy reclamation obligations. Certain receivables due from the buyer have also been reserved until such time as collection is more certain. | ||||||||||||||
Headwaters currently expects to continue to reflect as discontinued operations all activity related to the former coal cleaning business, at least until such time as the significant reclamation obligation is satisfied. | ||||||||||||||
Inventories
Inventories | 6 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Inventories | ||||||||
Inventories | ||||||||
5.Inventories | ||||||||
Inventories consisted of the following at: | ||||||||
(in thousands) | September 30, 2014 | March 31, 2015 | ||||||
Raw materials | $ | 12,017 | $ | 13,645 | ||||
Finished goods | 38,616 | 49,920 | ||||||
$ | 50,633 | $ | 63,565 | |||||
Intangible_Assets
Intangible Assets | 6 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Intangible Assets | ||||||||||||||||
Intangible Assets | ||||||||||||||||
6.Intangible Assets | ||||||||||||||||
The following table summarizes the gross carrying amounts and related accumulated amortization of intangible assets as of: | ||||||||||||||||
September 30, 2014 | March 31, 2015 | |||||||||||||||
(in thousands of dollars) | Estimated | Gross | Accumulated | Gross | Accumulated | |||||||||||
useful lives | Carrying | Amortization | Carrying | Amortization | ||||||||||||
Amount | Amount | |||||||||||||||
Trade names | Indefinite | $ | 15,300 | $ | — | $ | 15,300 | $ | — | |||||||
CCP contracts | 15 - 20 years | 112,300 | 64,192 | 112,300 | 67,033 | |||||||||||
Customer relationships | 5 - 17 years | 107,953 | 50,355 | 109,299 | 54,188 | |||||||||||
Trade names | 5 - 20 years | 67,220 | 33,394 | 67,220 | 35,104 | |||||||||||
Patents and patented technologies | 5 - 19 years | 14,526 | 11,686 | 14,526 | 12,130 | |||||||||||
Other | 5 - 17 years | 3,935 | 1,744 | 4,584 | 1,962 | |||||||||||
$ | 321,234 | $ | 161,371 | $ | 323,229 | $ | 170,417 | |||||||||
Total amortization expense related to intangible assets was approximately $5.5 million and $4.6 million for the March 2014 and 2015 quarters, respectively, and approximately $10.6 million and $9.0 million for the six months ended March 31, 2014 and 2015, respectively. The primary reason for the decrease in amortization expense from 2014 to 2015 is that certain assets have been fully amortized. | ||||||||||||||||
Total estimated annual amortization expense for 2015 through 2020 is shown in the following table: | ||||||||||||||||
Year ending September 30: | (in thousands) | |||||||||||||||
2015 | $ | 18,166 | ||||||||||||||
2016 | 17,957 | |||||||||||||||
2017 | 17,079 | |||||||||||||||
2018 | 17,030 | |||||||||||||||
2019 | 16,001 | |||||||||||||||
2020 | 11,762 | |||||||||||||||
Longterm_Debt
Long-term Debt | 6 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Long-term Debt | ||||||||
Long-term Debt | ||||||||
7.Long-term Debt | ||||||||
The total undiscounted face amount of Headwaters’ outstanding long-term debt was approximately $599.8 million as of September 30, 2014 and $575.0 million as of March 31, 2015. As of those dates, the discounted carrying value of long-term debt consisted of the following: | ||||||||
(in thousands) | September 30, | March 31, | ||||||
2014 | 2015 | |||||||
Senior secured term loan, due March 2022 (face amount $425,000) | $ | 0 | $ | 414,801 | ||||
7¼% Senior notes, due January 2019 (face amount $150,000) | 147,192 | 147,516 | ||||||
7-5/8% Senior secured notes, repaid in March 2015 (face amount $400,000) | 396,058 | 0 | ||||||
8.75% Convertible senior subordinated notes, repaid in February 2015 (face amount $49,791) | 49,208 | 0 | ||||||
Carrying amount of long-term debt, net of discounts and debt issue costs | 592,458 | 562,317 | ||||||
Less current portion | 0 | (3,188 | ) | |||||
Long-term debt | $ | 592,458 | $ | 559,129 | ||||
Senior Secured Term Loan — In March 2015, Headwaters entered into a new Term Loan Facility, under which a senior secured loan for $425.0 million was obtained. The loan will mature in March 2022, subject to certain exceptions described below. The Term Loan Facility requires scheduled quarterly repayments in an aggregate annual amount equal to 1.0% of the original principal amount (subject to reduction for certain permitted prepayments), with the balance due at maturity. In the event that in October 2018 Headwaters has more than $50.0 million outstanding of the 7¼% senior notes and has not received a binding commitment to refinance these notes, the maturity date of the Term Loan Facility will be October 2018. | ||||||||
The Term Loan Facility allows Headwaters to request one or more incremental term loans and certain other types of incremental debt in an aggregate amount not to exceed $150.0 million plus an additional amount which is dependent on Headwaters’ pro forma net leverage ratio, as defined. Any additional borrowings are contingent upon the receipt of commitments by existing or additional lenders. | ||||||||
Borrowings under the Term Loan Facility bear interest at a rate equal to, at Headwaters’ option, either (a) a base rate determined by reference to the highest of (i) the publicly announced prime rate of the administrative agent, (ii) the federal funds rate plus 0.50%, and (iii) the eurocurrency (LIBO) rate for a one-month interest period plus 1.0%, subject in all cases to a 2.0% floor; or (b) a eurocurrency (LIBO) rate determined by reference to the cost of funds for eurocurrency deposits in dollars, subject to a 1.0% floor; plus, in each case, an applicable margin of 3.5% for any eurocurrency loan and 2.5% for any alternate base rate loan. The initial interest rate on borrowings under the Term Loan Facility is 4.5%, with interest payable quarterly. | ||||||||
Headwaters may voluntarily repay outstanding loans under the Term Loan Facility at any time without premium or penalty, other than customary breakage costs with respect to LIBO rate loans and with respect to certain repricing transactions in which new secured term loans are incurred within six months of March 24, 2015, which shall be subject to a prepayment premium of 1.0%. The Term Loan Facility requires Headwaters to prepay outstanding term loans, subject to certain exceptions, with (i) up to 50% of Headwaters’ annual excess cash flow, as defined, to the extent such excess cash flow exceeds $1.0 million, commencing with fiscal year 2016, with such required prepayment to be reduced by the amount of voluntary prepayments of term loans and certain other types of senior secured debt; (ii) 100% of the net cash proceeds of certain non-ordinary course asset sales; and (iii) 100% of the net cash proceeds of certain issuances of debt. | ||||||||
The Term Loan Facility is secured by substantially all assets of Headwaters, except that the obligations have a second priority position with respect to the assets that secure Headwaters’ ABL Revolver, primarily consisting of certain trade receivables and inventories of Headwaters’ building products and construction materials segments. The Term Loan Facility contains customary covenants restricting the ability of Headwaters to incur additional debt and liens on assets, prepay future new subordinated debt, merge or consolidate with another company, sell all or substantially all assets, make investments and pay dividends or distributions, among other things. The Term Loan Facility contains customary events of default, including with respect to a change in control of Headwaters. | ||||||||
The net proceeds from the initial borrowing under the Term Loan Facility were approximately $414.7 million, after giving effect to original issue discount of approximately $2.1 million and estimated transaction costs of approximately $8.2 million. As described below, the net proceeds from the original borrowing under the Term Loan Facility were primarily used to pay the redemption price in connection with the redemption of all of the outstanding 7-5/8% senior secured notes. | ||||||||
7¼% Senior Notes — In December 2013, Headwaters issued $150.0 million of 7¼% senior notes for net proceeds of approximately $146.7 million. The 7¼% notes are unsecured, mature in January 2019 and bear interest at a rate of 7.25%, payable semiannually. The notes are subordinate in priority to the senior secured Term Loan Facility described above and the ABL Revolver described below, to the extent of the value of the assets securing such debt, and are senior to all other future subordinated debt. | ||||||||
Headwaters can redeem the 7¼% notes, in whole or in part, at any time after January 15, 2016 at redemption prices that decline over time from 103.625% to 100.0%, depending on the redemption date. In addition, until January 15, 2016, Headwaters can redeem at a price of 107.25% up to 35% of the outstanding notes with the net proceeds from one or more equity offerings. Headwaters can also redeem any of the notes at any time prior to January 15, 2016 at a price equal to 100% of the principal amount plus a make-whole premium. If there is a change in control, Headwaters will be required to offer to purchase the notes from holders at a purchase price equal to 101% of the principal amount. | ||||||||
The 7¼% notes limit Headwaters in the incurrence of additional debt and liens on assets, prepayment of subordinated debt, merging or consolidating with another company, selling all or substantially all assets, making investments and the payment of dividends or distributions, among other things. Headwaters was in compliance with all debt covenants as of March 31, 2015. | ||||||||
ABL Revolver — Since entering into the ABL Revolver, Headwaters has not borrowed any funds under the arrangement and has no borrowings outstanding as of March 31, 2015. Availability under the ABL Revolver cannot exceed $70.0 million, which includes a $35.0 million sub-line for letters of credit and a $10.5 million swingline facility. Availability under the ABL Revolver is further limited by the borrowing base valuations of the assets of Headwaters’ building products and construction materials segments which secure the borrowings, currently consisting of certain trade receivables and inventories. In addition to the first lien position on these assets, the ABL Revolver lenders have a second priority position on substantially all other assets of Headwaters. | ||||||||
As of March 31, 2015, Headwaters had secured letters of credit under the ABL Revolver of approximately $7.4 million for various purposes and had availability under the ABL Revolver of approximately $60.6 million. The ABL Revolver terminates in March 2020. There is a contingent provision for early termination at any time within three months prior to the earliest maturity date of the senior secured Term Loan Facility or the 7¼% senior notes, at which time any amounts borrowed must be repaid. | ||||||||
Outstanding borrowings under the ABL Revolver accrue interest at Headwaters’ option, at either i) the London Interbank Offered Rate (LIBOR) plus 1.5%, 1.75% or 2.0%, depending on Headwaters’ average net excess availability under the ABL; or ii) the “Base Rate” plus 0.25%, 0.5% or 0.75%, again depending on average net excess availability. The base rate is subject to a floor equal to the highest of i) the prime rate, ii) the federal funds rate plus 0.5%, and iii) the 30-day LIBOR rate plus 1.0%. Fees on the unused portion of the ABL Revolver range from 0.25% to 0.375%, depending on the amount of the credit facility which is utilized. If there would have been borrowings outstanding under the ABL Revolver as of March 31, 2015, the interest rate on those borrowings would have been approximately 1.8%. | ||||||||
The ABL Revolver contains restrictions and covenants common to such agreements, including limitations on the incurrence of additional debt and liens on assets, prepayment of subordinated debt, merging or consolidating with another company, selling assets, making acquisitions and investments and the payment of dividends or distributions, among other things. In addition, if availability under the ABL Revolver is less than 12.5%, Headwaters is required to maintain a monthly fixed charge coverage ratio of at least 1.0x for the preceding twelve-month period. Headwaters was in compliance with all covenants as of March 31, 2015. | ||||||||
7-5/8% Senior Secured Notes — In 2011, Headwaters issued $400.0 million of 7-5/8% senior secured notes for net proceeds of approximately $392.8 million. In March 2015, Headwaters irrevocably deposited with the trustee of the notes an amount sufficient to pay and discharge all obligations under the notes and the related indenture, which discharge the trustee acknowledged. As a result, the indenture and all related guarantees and security interests have been discharged. This discharge resulted in a loss on extinguishment of debt of approximately $21.3 million, comprised of the early repayment premium of approximately $15.3 million, interest to the April 2015 redemption date totaling approximately $2.5 million, and accelerated amortization of unamortized debt issue costs of approximately $3.5 million. The loss on debt extinguishment is reflected as interest expense in Headwaters’ statements of operations for the 2015 periods. | ||||||||
8.75% Convertible Senior Subordinated Notes Due 2016 — In February 2015, Headwaters repurchased and canceled substantially all of the outstanding 8.75% convertible senior subordinated notes, pursuant to open market transactions. Premiums and accelerated amortization of debt discount and debt issue costs aggregating approximately $3.5 million were paid and charged to interest expense in the statement of operations. | ||||||||
Interest and Debt Maturities — During the March 2014 and 2015 quarters, Headwaters incurred total interest costs of approximately $12.4 million and $36.1 million, respectively, including approximately $0.6 million and $4.5 million, respectively, of non-cash interest expense. During the six months ended March 31, 2014 and 2015, Headwaters incurred total interest costs of approximately $22.6 million and $48.3 million, respectively, including approximately $1.2 million and $5.0 million, respectively, of non-cash interest expense. As described above, approximately $24.8 million of interest expense incurred in the 2015 periods resulted from the early repayments of the 7-5/8% senior secured notes and the 8.75% convertible senior subordinated notes. | ||||||||
Neither capitalized interest nor interest income was material for any period presented. The weighted-average interest rate on the face amount of outstanding long-term debt, excluding amortization of debt discount and debt issue costs, was approximately 7.6% at September 30, 2014 and 5.2% at March 31, 2015. Except for the required repayments of the senior secured term loan of approximately $1.1 million per quarter beginning September 30, 2015, Headwaters has no debt maturities until January 2019. | ||||||||
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 6 Months Ended |
Mar. 31, 2015 | |
Fair Value of Financial Instruments | |
Fair Value of Financial Instruments | |
8.Fair Value of Financial Instruments | |
Headwaters’ material financial instruments consist primarily of cash and cash equivalents, trade receivables, accounts payable and long-term debt. All of these financial instruments except some long-term debt are either carried at fair value in the consolidated balance sheets or are short-term in nature. Accordingly, the carrying values for those financial instruments as reflected in the consolidated balance sheets closely approximate their fair values. | |
All of Headwaters’ outstanding long-term debt as of September 30, 2014 was fixed-rate. Using fair values for the debt, the aggregate fair value of Headwaters’ long-term debt as of September 30, 2014 would have been approximately $626.0 million, compared to a carrying value of $592.5 million. As of March 31, 2015, only the 7¼% senior notes have a fixed rate and the aggregate fair value of this debt as of March 31, 2015 would have been approximately $158.0 million, compared to a carrying value of $147.5 million. | |
Fair value “Level 2” estimates for long-term debt were based primarily on price estimates from broker-dealers. The fair values for long-term debt differ from the carrying values primarily due to interest rates that differ from current market interest rates and, for the convertible senior subordinated notes that were outstanding at September 30, 2014, the difference between Headwaters’ common stock price at that date and the conversion price. | |
Income_Taxes
Income Taxes | 6 Months Ended | |||
Mar. 31, 2015 | ||||
Income Taxes | ||||
Income Taxes | ||||
9.Income Taxes | ||||
Headwaters’ estimated effective income tax rate for continuing operations for the fiscal year ending September 30, 2015, exclusive of discrete items, is currently expected to be approximately 10%. This estimated rate was used to record income taxes for the six months ended March 31, 2015. For the six months ended March 31, 2014, Headwaters used an estimated effective income tax rate for continuing operations of 18%. Headwaters did not recognize any tax expense or benefit for discrete items in 2014, but recognized approximately $0.9 million of tax benefit for discrete items in 2015 that did not affect the calculation of the estimated effective income tax rate for the 2015 fiscal year. The discrete items were due primarily to unrecognized state income tax benefits that were reversed due to audit periods that closed. | ||||
Beginning in 2011, Headwaters has recorded a full valuation allowance on its net amortizable deferred tax assets and accordingly, did not recognize benefit for tax credit carryforwards, net operating loss (NOL) carryforwards or other deferred tax assets for any period presented, except to the extent of projected fiscal year earnings. The estimated income tax rates of 18% for fiscal 2014 and 10% for fiscal 2015 resulted primarily from the combination of recognizing benefit for deferred tax assets only to the extent of projected fiscal year earnings, plus current state income taxes in certain state jurisdictions where taxable income is expected to be generated. | ||||
A valuation allowance is required when there is significant uncertainty as to the realizability of deferred tax assets. The ability to realize deferred tax assets is dependent upon Headwaters’ ability to generate sufficient taxable income within the carryforward periods provided for in the tax law for each tax jurisdiction. Headwaters has considered the following possible sources of taxable income when assessing the realization of its deferred tax assets: | ||||
· | future reversals of existing taxable temporary differences; | |||
· | future taxable income or loss, exclusive of reversing temporary differences and carryforwards; | |||
· | tax-planning strategies; and | |||
· | taxable income in prior carryback years. | |||
Headwaters considered both positive and negative evidence in determining the continued need for a valuation allowance, including the following: | ||||
Positive evidence: | ||||
· | Current forecasts indicate that Headwaters’ will generate pre-tax income and taxable income in the future. | |||
· | A majority of Headwaters’ tax attributes have significant carryover periods of 20 years or more. | |||
Negative evidence: | ||||
· | Headwaters had a three-year cumulative loss as of September 30, 2014, and has not generated significant earnings year to date in fiscal 2015. | |||
· | Headwaters operates in cyclical industries that are difficult to forecast. | |||
Headwaters places more weight on objectively verifiable evidence than on other types of evidence and management currently believes that available negative evidence outweighs the available positive evidence. Management has therefore determined that Headwaters does not meet the “more likely than not” threshold that NOLs, tax credits and other deferred tax assets will be realized. Accordingly, a valuation allowance is required. During fiscal 2015, Headwaters may emerge from a three-year cumulative loss status on a consolidated basis. Headwaters will consider this and the other factors described above in evaluating the continued need for a full, or partial, valuation allowance. | ||||
All of the factors Headwaters is considering in evaluating whether and when to release all or a portion of the deferred tax asset valuation allowance involve significant judgment. For example, there are many different interpretations of “cumulative losses in recent years” which can be used. Also, significant judgment is involved in making projections of future financial and taxable income, especially because Headwaters’ financial results are significantly dependent upon industry trends, including new housing construction, repair and remodeling, and infrastructure construction. Most of the end use categories in which Headwaters sells its products and services are currently in varying states of recovery from the historic downturn experienced in recent years; however, it is not possible to accurately predict whether recovery will continue, and if it does, at what rate and for how long. Any reversal of the valuation allowance will favorably impact Headwaters’ results of operations in the period of reversal. | ||||
As of March 31, 2015, Headwaters’ NOL and capital loss carryforwards totaled approximately $77.8 million (tax effected). The U.S. and state NOLs expire from 2015 to 2034. In addition, there are approximately $24.8 million of tax credit carryforwards as of March 31, 2015, which expire from 2028 to 2034. | ||||
The calculation of tax liabilities involves uncertainties in the application of complex tax regulations in multiple tax jurisdictions. Headwaters currently has open tax years subject to examination by the IRS and state tax authorities for the years 2011 through 2013. Headwaters recognizes potential liabilities for anticipated tax audit issues in the U.S. and state tax jurisdictions based on estimates of whether, and the extent to which, additional taxes and interest will be due. If events occur (or do not occur) as expected and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when it is determined the liabilities are no longer required to be recorded in the consolidated financial statements. If the estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result. It is reasonably possible that approximately $5.0 million of Headwaters’ unrecognized income tax benefits will be released within the next 12 months. Most of this amount relates to state taxes and is currently expected to be released in the December 2015 quarter due to the expiration of statute of limitation time periods. | ||||
Equity_Securities_and_StockBas
Equity Securities and Stock-Based Compensation | 6 Months Ended |
Mar. 31, 2015 | |
Equity Securities and Stock-Based Compensation | |
Equity Securities and Stock-Based Compensation | |
10.Equity Securities and Stock-Based Compensation | |
Treasury Shares Held for Deferred Compensation Obligation — In accordance with the terms of the Directors’ Deferred Compensation Plan (DDCP), non-employee directors can elect to defer certain compensation and choose from various options how the deferred compensation will be invested. One of the investment options is Headwaters common stock. When a director chooses Headwaters stock as an investment option, Headwaters purchases the common stock in accordance with the director’s request and holds the shares until such time as the deferred compensation obligation becomes payable, normally when the director retires from the Board. At such time, the shares held by Headwaters are distributed to the director in satisfaction of the obligation. Headwaters accounts for the purchase of common stock as treasury stock, at cost. The corresponding deferred compensation obligation is reflected in capital in excess of par value. Changes in the fair value of the treasury stock are not recognized. As of March 31, 2015, the treasury stock and related deferred compensation obligation had fair values of approximately $1.3 million, which was $0.6 million higher than the carrying values at cost. | |
Stock-Based Compensation — In the December 2014 quarter, the Compensation Committee of Headwaters’ Board of Directors (the Committee) approved the grant of approximately 0.3 million stock-based awards to officers and employees. The awards were granted under terms of the 2010 Incentive Compensation Plan and vest over an approximate three-year period. Vesting is also subject to a 60-day average stock price hurdle that precludes vesting unless Headwaters’ stock price exceeds by a predetermined amount the stock price on the date of grant, which threshold was reached during the March 2015 quarter. | |
Stock-based compensation expense was approximately $0.5 million and $0.7 million for the March 2014 and 2015 quarters, respectively, and $1.0 million and $1.3 million for the six months ended March 31, 2014 and 2015, respectively. As of March 31, 2015, there was approximately $3.7 million of total compensation cost related to unvested awards not yet recognized, which will be recognized in future periods in accordance with applicable vesting terms. | |
Earnings_per_Share
Earnings per Share | 6 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Earnings per Share | ||||||||||||||
Earnings per Share | ||||||||||||||
11.Earnings per Share | ||||||||||||||
The following table sets forth the computations of basic and diluted EPS, reflecting the amounts attributable to Headwaters and excluding the amounts attributable to the non-controlling interest in Entegra. In accordance with ASC 260, income (loss) from continuing operations for each period is used as the control number in determining whether potentially dilutive common shares should be included in the diluted earnings per share computations for those periods, even when the effect of doing so is anti-dilutive to the other per-share amounts. | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
March 31, | March 31, | |||||||||||||
(in thousands, except per-share amounts) | 2014 | 2015 | 2014 | 2015 | ||||||||||
Numerator: | ||||||||||||||
Loss from continuing operations | $ | (9,507 | ) | $ | (24,988 | ) | $ | (11,641 | ) | $ | (17,837 | ) | ||
Income from continuing operations attributable to non-controlling interest | (236 | ) | (259 | ) | (230 | ) | (504 | ) | ||||||
Adjustment of estimated redemption value of non-controlling interest | 0 | 276 | 0 | 0 | ||||||||||
Numerator for basic and diluted earnings per share from continuing operations — loss from continuing operations attributable to Headwaters Incorporated | (9,743 | ) | (24,971 | ) | (11,871 | ) | (18,341 | ) | ||||||
Numerator for basic and diluted earnings per share from discontinued operations — income (loss) from discontinued operations, net of income taxes | (575 | ) | (210 | ) | 125 | (277 | ) | |||||||
Numerator for basic and diluted earnings per share — net loss attributable to Headwaters Incorporated | $ | (10,318 | ) | $ | (25,181 | ) | $ | (11,746 | ) | $ | (18,618 | ) | ||
Denominator: | ||||||||||||||
Denominator for basic and diluted earnings per share — weighted-average shares outstanding | 73,121 | 73,555 | 73,094 | 73,501 | ||||||||||
Basic and diluted income (loss) per share attributable to Headwaters Incorporated: | ||||||||||||||
From continuing operations | $ | (0.13 | ) | $ | (0.34 | ) | $ | (0.16 | ) | $ | (0.25 | ) | ||
From discontinued operations | (0.01 | ) | (0.00 | ) | 0 | (0.00 | ) | |||||||
$ | (0.14 | ) | $ | (0.34 | ) | $ | (0.16 | ) | $ | (0.25 | ) | |||
Anti-dilutive securities not considered in diluted EPS calculation: | ||||||||||||||
Stock-settled SARs | 3,821 | 3,811 | 3,879 | 2,358 | ||||||||||
Stock options | 594 | 105 | 606 | 105 | ||||||||||
Restricted stock | 253 | 264 | 253 | 132 | ||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 6 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | |
12.Commitments and Contingencies | |
Significant new commitments, material changes in commitments and ongoing contingencies as of March 31, 2015, not disclosed elsewhere, are as follows: | |
Compensation Arrangements — Cash Performance Unit Awards. The Compensation Committee has approved various grants of performance unit awards to certain officers and employees, to be settled in cash, based on the achievement of certain stipulated goals, all of which are described in detail in the Form 10-K (including fiscal 2015 grants made in the December 2014 quarter). Since September 30, 2014, there have been no significant changes in Headwaters’ commitments or in the amounts accrued under these awards, except for payment in the December 2014 quarter of amounts contractually due under the terms of certain prior year awards. As explained in the Form 10-K, the amounts accrued under the fiscal 2014 awards are subject to adjustment for cash flows generated in fiscal 2015 and 2016. | |
Headwaters also currently expects that additional amounts could be earned in the June and September 2015 quarters under the terms of the fiscal 2015 awards. | |
Cash-Settled SAR Grants. In fiscal 2011, the Committee approved grants to certain employees of approximately 0.4 million cash-settled SARs, approximately 0.1 million of which remain outstanding as of March 31, 2015. These SARs are considered liability awards and vested in annual installments through September 30, 2013, provided the participant was still employed by Headwaters at the respective vest dates, and are settled in cash upon exercise by the employee. The SARs terminate on September 30, 2015 and must be exercised on or before that date. As of March 31, 2015, approximately $0.9 million has been accrued for outstanding awards because the stock price at March 31, 2015 was above the grant-date stock price of $3.81. Future changes in Headwaters’ stock price in any amount above $3.81 through September 30, 2015 will result in adjustment to the expected remaining liability, which adjustment (whether positive or negative) will be reflected in Headwaters’ statement of operations each quarter. | |
In fiscal 2012, the Committee approved grants to certain officers and employees of approximately 1.0 million cash-settled SARs, approximately 0.3 million of which remain outstanding as of March 31, 2015. These SARs have terms similar to those described above, except they could not vest until and unless the 60-day average stock price exceeded approximately 135% of the stock price on the date of grant (or $2.50), which occurred in fiscal 2012. Approximately $5.8 million has been accrued for outstanding awards as of March 31, 2015. Changes in Headwaters’ stock price in any amount above the grant-date stock price of $1.85 through September 30, 2016, the date these SARs expire, will result in adjustment to the expected remaining liability, which adjustment (whether positive or negative) will be reflected in Headwaters’ statement of operations each quarter. Compensation expense for all cash-settled SARs was approximately $4.2 million and $2.7 million for the six months ended March 31, 2014 and 2015, respectively. | |
Property, Plant and Equipment — As of March 31, 2015, Headwaters was committed to spend approximately $1.7 million on capital projects that were in various stages of completion. | |
Legal Matters — Headwaters has ongoing litigation and asserted claims which have been incurred in the normal course of business, including the specific matters discussed below. Headwaters intends to vigorously defend or resolve these matters by settlement, as appropriate. Management does not currently believe that the outcome of these matters will have a material adverse effect on Headwaters’ operations, cash flow or financial position. | |
Headwaters incurred approximately $3.9 million and $1.7 million of expense for legal matters during the six months ended March 31, 2014 and 2015, respectively. Costs for outside legal counsel comprised a majority of Headwaters’ litigation-related costs in the periods presented. Headwaters currently believes the range of potential loss for all unresolved legal matters, excluding costs for outside counsel, is from $2.5 million up to the amounts sought by claimants and has recorded a liability as of March 31, 2015 of $2.5 million. The substantial claims and damages sought by claimants in excess of this amount are not currently deemed to be probable. Headwaters’ outside counsel and management currently believe that unfavorable outcomes of outstanding litigation beyond the amount accrued are neither probable nor remote. Accordingly, management cannot express an opinion as to the ultimate amount, if any, of Headwaters’ liability, nor is it possible to estimate what litigation-related costs will be in future periods. | |
The specific matters discussed below raise difficult and complex legal and factual issues, and the resolution of these issues is subject to many uncertainties, including the facts and circumstances of each case, the jurisdiction in which each case is brought, and the future decisions of juries, judges, and arbitrators. Therefore, although management believes that the claims asserted against Headwaters in the named cases lack merit, there is a possibility of material losses in excess of the amount accrued if one or more of the cases were to be determined adversely against Headwaters for a substantial amount of the damages asserted. It is possible that a change in the estimate of probable liability could occur, and the changes could be material. Additionally, as with any litigation, these proceedings require that Headwaters incur substantial costs, including attorneys’ fees, managerial time and other personnel resources, in pursuing resolution. | |
EPA. In April 2012, Headwaters Resources, Inc. (HRI) filed a complaint in the United States District Court for the District of Columbia against the United States Environmental Protection Agency (EPA). The complaint alleges that the EPA failed to review, and where necessary, revise RCRA subtitle D regulations applicable to the disposal of coal ash within the timeframe required by statute. Other parties also initiated litigation against the EPA alleging the same (and other) failures of the EPA to perform its duties regarding coal ash disposal regulations. HRI’s complaint seeks certain declaratory relief with respect to EPA rulemaking at issue in the case. The District Court consolidated HRI’s case with related actions brought by other parties. In October 2013, the District Court granted summary judgment that the EPA failed to fulfill its statutory duty to review coal ash disposal regulations, among other things, ordering the EPA to propose a schedule to complete its review of coal ash disposal regulations, and, as necessary, revise the regulations. In May 2014, the District Court entered a consent decree ordering the EPA to take final action in December 2014 regarding EPA’s proposed revisions of RCRA subtitle D regulations pertaining to coal combustion residuals. In December 2014, the EPA issued a prepublication notice of a final rule to regulate the disposal of coal combustion residuals as solid (non-hazardous) waste under subtitle D of RCRA, with national minimum criteria for CCR landfills and impoundments consisting of location restrictions, design and operating criteria, groundwater monitoring and corrective action, closure requirements, post closure care, recordkeeping and reporting, and other requirements. The final rule will be effective 180 days after publication in the Federal Register, which publication occurred on April 17, 2015. It is expected that the EPA will move to terminate the consent decree in the near future which will end the case. | |
Fentress Families Trust. VFL Technology Corporation (VFL), acquired by HRI in 2004, provides services related to fly ash management to Virginia Electric and Power Company. In February 2012, 383 plaintiffs, most of whom are residents living in the City of Chesapeake, Virginia, filed a complaint in the State of Virginia Chesapeake Circuit Court against 15 defendants, including Virginia Electric and Power Company (VEPCO), and certain other persons associated with the Battlefield Golf Course, including owners, developers, contractors, and others, including VFL and Headwaters, alleging causes of action for nuisance and negligence. The complaint alleges that fly ash used to construct the golf course was carried in the air and contaminated water exposing plaintiffs to dangerous chemicals and causing property damage. Plaintiffs’ complaint seeks injunctive relief and damages of approximately $850.0 million for removal and remediation of the fly ash and the water supply, $1.9 billion for vexation, $8.0 million and other unspecified amounts for personal injuries, and $55.0 million as damages to properties, plus prejudgment interest, attorney fees, and costs. In a related case, other plaintiffs have filed a separate lawsuit asserting the same claims against the same defendants claiming additional damages totaling approximately $307.2 million. In August 2013 the court ruled on VEPCO’s demurrer ordering that claims for personal injury or property damage based upon allegations of groundwater contamination were dismissed but that claims of nuisance and negligence based upon allegations of air-borne ash and contaminated surface water would not be dismissed. These cases are based on substantially the same alleged circumstances asserted in complaints filed by the plaintiffs in 2009 and voluntarily dismissed in 2010. Discovery is underway. HRI has filed claims for defense and indemnity with several of its insurers. In 2010, HRI filed suit in the United States District Court for the District of Utah against two insurers that denied coverage based on allegations in the 2009 Fentress complaints. The District Court ruled in the insurers’ favor, which ruling was affirmed in October 2014 by the United States Court of Appeals for the Tenth Circuit. Another insurer continues to pay for the defense of the underlying cases under a reservation of rights. The relatively novel fly ash claims of the plaintiffs together with multiple insurance policies and policy periods make insurance coverage issues complex and uncertain. Moreover, plaintiffs’ total claims exceed the potential limits of insurance available to HRI. Because resolution of the litigation is uncertain, legal counsel and management cannot express an opinion as to the ultimate amount, if any, of HRI’s liability, or the insurers’ obligation to indemnify HRI against loss, if any. | |
CPM. In December 2012, CPM Virginia, LLC filed a complaint in the State of Virginia Chesapeake Circuit Court against HRI related to construction of the golf course described in the Fentress Families Trust case, alleging breach of contract and seeking declaratory judgment and compensatory damages in the amount of $0.5 million plus attorney fees and costs. CPM alleged that HRI should indemnify CPM for past and future expenses incurred in defending against the Fentress complaints. In April 2015, the parties agreed to dismiss the case without prejudice to the potential refiling of the claims in the future. In December 2014, CPM filed a separate complaint in the State of Virginia Richmond Circuit Court against VEPCO, VFL, and Headwaters. Plaintiff claimed that VEPCO and VFL withheld information from CPM about the environmental and safety risks of using fly ash to construct the golf course which CPM asserts that it owns or has an interest in. CPM alleged multiple causes of action and claimed hundreds of millions of dollars in damages, including site remediation costs, punitive damages, and attorney fees. In February 2015, plaintiff voluntarily dismissed the complaint without prejudice to the potential refiling of the claims in the future. | |
Building Products Matters. There are litigation and pending and threatened claims made against certain subsidiaries within Headwaters’ building products segment, with respect to several types of exterior finish systems manufactured and sold by its subsidiaries for application by contractors on residential and commercial buildings. The plaintiffs or claimants in these matters typically allege that the structures have suffered damage from water penetration due to some alleged failure of the roofing product or wall system. The claims most often involve alleged liabilities associated with certain roofing, stucco, and architectural stone products which are produced and sold by certain subsidiaries of Headwaters. | |
The foregoing litigation and claims typically cite damages for alleged personal injuries, property damage, economic loss, unfair business practices and punitive damages. Claims made against Headwaters and its subsidiaries generally have been paid by their insurers, subject to Headwaters’ payment of deductibles or self-insured retentions, although such insurance carriers typically have issued “reservation of rights” letters. There is no guarantee of insurance coverage or continuing coverage. These and future proceedings may result in substantial costs to Headwaters and its subsidiaries, including attorneys’ fees, managerial time and other personnel resources and costs. Adverse resolution of these proceedings could have a materially negative effect on Headwaters’ businesses, financial condition, and results of operation, and its ability to meet its financial obligations. Although Headwaters carries general and product liability insurance, subject to exclusions and self-insured retentions, Headwaters cannot assure that such insurance coverage will remain available, that Headwaters’ insurance carriers will remain viable, will accept claims or that the insured amounts will cover all claims in excess of self-insured retentions. Future rate increases may also make such insurance uneconomical for Headwaters to maintain. Because resolution of the litigation, claims, and insurance coverage is uncertain, legal counsel and management cannot express an opinion as to the ultimate amount, if any, of Headwaters’ or its subsidiaries’ liability. | |
Construction Materials Matters. In addition, there are litigation and pending and threatened claims made against HRI, Headwaters’ construction materials segment, with respect to coal combustion products. The plaintiffs or claimants in these matters have alleged that inhalation or other exposure to fly ash is unsafe, and that HRI has failed to warn about the alleged dangers of fly ash exposure and the use of adequate protection, resulting in personal injury, contamination of land and water, and diminution in property value. The Fentress Family Trust case summarized above is an example of these types of claims. The application of relatively novel fly ash claims to insurance policies is complex and uncertain and HRI has had limited success in tendering defense of such claims to insurers, which is dependent upon the alleged facts and specific policy terms. Adverse resolution of these claims and insurance coverage disputes could have a materially negative effect on Headwaters’ businesses, financial condition, and results of operation, and its ability to meet its financial obligations. Because resolution of the litigation, claims, and insurance coverage disputes is uncertain, legal counsel and management cannot express an opinion as to the ultimate amount, if any, of HRI’s liability. | |
Other. Headwaters and its subsidiaries are also involved in other legal proceedings that have arisen in the normal course of business. Because resolution of these proceedings is uncertain, legal counsel and management cannot express an opinion as to the ultimate amount, if any, of Headwaters’ liability. | |
Condensed_Consolidating_Financ
Condensed Consolidating Financial Information | 6 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Condensed Consolidating Financial Information | |||||||||||||||||
Condensed Consolidating Financial Information | |||||||||||||||||
13. Condensed Consolidating Financial Information | |||||||||||||||||
Headwaters’ borrowings under the Term Loan Facility and the 7¼% senior notes are jointly and severally, fully and unconditionally guaranteed by Headwaters Incorporated and by substantially all of Headwaters’ 100%-owned domestic subsidiaries. Separate stand-alone financial statements and disclosures for Headwaters Incorporated and each of the guarantor subsidiaries are not presented because the guarantees are full and unconditional and the guarantor subsidiaries have joint and several liability. | |||||||||||||||||
There are no significant restrictions on the ability of Headwaters Incorporated to obtain funds from the guarantor subsidiaries nor on the ability of the guarantor subsidiaries to obtain funds from Headwaters Incorporated or other guarantor subsidiaries. Non-guaranteeing entities include subsidiaries that are not 100% owned, foreign subsidiaries and joint ventures in which Headwaters has a non-controlling ownership interest. | |||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET — September 30, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Eliminations | Headwaters | |||||||||||||
guarantor | and | ||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Reclassifications | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 33,552 | $ | 5,764 | $ | 113,226 | $ | — | $ | 152,542 | |||||||
Trade receivables, net | 113,940 | 5,390 | 119,330 | ||||||||||||||
Inventories | 48,482 | 2,151 | 50,633 | ||||||||||||||
Deferred income taxes | 15,509 | 289 | 18,427 | (23,149 | ) | 11,076 | |||||||||||
Other | 9,286 | 168 | 1,082 | 10,536 | |||||||||||||
Total current assets | 220,769 | 13,762 | 132,735 | (23,149 | ) | 344,117 | |||||||||||
Property, plant and equipment, net | 162,458 | 11,674 | 7,979 | — | 182,111 | ||||||||||||
Other assets: | |||||||||||||||||
Goodwill | 145,068 | 30,518 | 175,586 | ||||||||||||||
Intangible assets, net | 131,150 | 28,713 | 159,863 | ||||||||||||||
Investments in subsidiaries | 406,327 | (406,327 | ) | — | |||||||||||||
Intercompany accounts and notes | 637,046 | (637,046 | ) | — | |||||||||||||
Deferred income taxes | 41,658 | 22,928 | (64,586 | ) | — | ||||||||||||
Other | 14,388 | 1,381 | 18,860 | 34,629 | |||||||||||||
Total other assets | 332,264 | 60,612 | 1,085,161 | (1,107,959 | ) | 370,078 | |||||||||||
Total assets | $ | 715,491 | $ | 86,048 | $ | 1,225,875 | $ | (1,131,108 | ) | $ | 896,306 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | |||||||||||||||||
Accounts payable | $ | 25,643 | $ | 956 | $ | 427 | $ | — | $ | 27,026 | |||||||
Accrued personnel costs | 13,483 | 418 | 35,001 | 48,902 | |||||||||||||
Accrued interest | 18,273 | 18,273 | |||||||||||||||
Current income taxes | 23,198 | 319 | (23,149 | ) | 368 | ||||||||||||
Other accrued liabilities | 36,811 | 3,006 | 1,940 | 41,757 | |||||||||||||
Total current liabilities | 99,135 | 4,699 | 55,641 | (23,149 | ) | 136,326 | |||||||||||
Long-term liabilities: | |||||||||||||||||
Long-term debt, net | 592,458 | 592,458 | |||||||||||||||
Income taxes | 65,133 | 893 | 21,802 | (64,586 | ) | 23,242 | |||||||||||
Intercompany accounts and notes | 191,274 | 4,061 | 441,711 | (637,046 | ) | — | |||||||||||
Other | 16,167 | 774 | 11,645 | 28,586 | |||||||||||||
Total long-term liabilities | 272,574 | 5,728 | 1,067,616 | (701,632 | ) | 644,286 | |||||||||||
Total liabilities | 371,709 | 10,427 | 1,123,257 | (724,781 | ) | 780,612 | |||||||||||
Redeemable non-controlling interest in consolidated subsidiary | 13,252 | 13,252 | |||||||||||||||
Stockholders’ equity: | |||||||||||||||||
Common stock | 74 | 74 | |||||||||||||||
Capital in excess of par value | 458,498 | 60,453 | 723,824 | (519,127 | ) | 723,648 | |||||||||||
Retained earnings (accumulated deficit) | (114,716 | ) | 1,916 | (620,688 | ) | 112,800 | (620,688 | ) | |||||||||
Treasury stock | (592 | ) | (592 | ) | |||||||||||||
Total stockholders’ equity | 343,782 | 62,369 | 102,618 | (406,327 | ) | 102,442 | |||||||||||
Total liabilities and stockholders’ equity | $ | 715,491 | $ | 86,048 | $ | 1,225,875 | $ | (1,131,108 | ) | $ | 896,306 | ||||||
CONDENSED CONSOLIDATING BALANCE SHEET — March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Eliminations | Headwaters | |||||||||||||
guarantor | and | ||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Reclassifications | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 36,633 | $ | 2,975 | $ | 40,115 | $ | — | $ | 79,723 | |||||||
Trade receivables, net | 85,726 | 5,640 | 91,366 | ||||||||||||||
Inventories | 60,857 | 2,708 | 63,565 | ||||||||||||||
Current and deferred income taxes | 7,196 | 27,998 | 44,780 | (68,756 | ) | 11,218 | |||||||||||
Other | 10,596 | 163 | 1,387 | 12,146 | |||||||||||||
Total current assets | 201,008 | 39,484 | 86,282 | (68,756 | ) | 258,018 | |||||||||||
Property, plant and equipment, net | 162,422 | 10,304 | 9,523 | — | 182,249 | ||||||||||||
Other assets: | |||||||||||||||||
Goodwill | 144,643 | 30,869 | 175,512 | ||||||||||||||
Intangible assets, net | 124,836 | 27,976 | 152,812 | ||||||||||||||
Investments in subsidiaries | 46,273 | 474,868 | (521,141 | ) | — | ||||||||||||
Intercompany accounts and notes | 637,046 | (637,046 | ) | — | |||||||||||||
Deferred income taxes | 50,188 | 23,589 | (73,777 | ) | — | ||||||||||||
Other | 10,894 | 2,180 | 21,571 | 34,645 | |||||||||||||
Total other assets | 376,834 | 61,025 | 1,157,074 | (1,231,964 | ) | 362,969 | |||||||||||
Total assets | $ | 740,264 | $ | 110,813 | $ | 1,252,879 | $ | (1,300,720 | ) | $ | 803,236 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | |||||||||||||||||
Accounts payable | $ | 17,904 | $ | 908 | $ | 1,008 | $ | — | $ | 19,820 | |||||||
Accrued personnel costs | 9,551 | 598 | 22,426 | 32,575 | |||||||||||||
Accrued interest | 2,721 | 2,721 | |||||||||||||||
Current income taxes | 47,658 | 21,098 | (68,756 | ) | — | ||||||||||||
Other accrued liabilities | 27,939 | 5,122 | 3,988 | 37,049 | |||||||||||||
Current portion of long-term debt | 3,188 | 3,188 | |||||||||||||||
Total current liabilities | 103,052 | 6,628 | 54,429 | (68,756 | ) | 95,353 | |||||||||||
Long-term liabilities: | |||||||||||||||||
Long-term debt, net | 559,129 | 559,129 | |||||||||||||||
Income taxes | 64,117 | 7,310 | 21,289 | (73,777 | ) | 18,939 | |||||||||||
Intercompany accounts and notes | 177,035 | 516,660 | (693,695 | ) | — | ||||||||||||
Other | 333 | 15,457 | 15,569 | 31,359 | |||||||||||||
Total long-term liabilities | 64,450 | 199,802 | 1,112,647 | (767,472 | ) | 609,427 | |||||||||||
Total liabilities | 167,502 | 206,430 | 1,167,076 | (836,228 | ) | 704,780 | |||||||||||
Redeemable non-controlling interest in consolidated subsidiary | 12,829 | 12,829 | |||||||||||||||
Stockholders’ equity: | |||||||||||||||||
Common stock | 74 | 74 | |||||||||||||||
Capital in excess of par value | 486,069 | 56,922 | 725,791 | (543,167 | ) | 725,615 | |||||||||||
Retained earnings (accumulated deficit) | 86,693 | (165,368 | ) | (639,306 | ) | 78,675 | (639,306 | ) | |||||||||
Treasury stock | (756 | ) | (756 | ) | |||||||||||||
Total stockholders’ equity | 572,762 | (108,446 | ) | 85,803 | (464,492 | ) | 85,627 | ||||||||||
Total liabilities and stockholders’ equity | $ | 740,264 | $ | 110,813 | $ | 1,252,879 | $ | (1,300,720 | ) | $ | 803,236 | ||||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Three Months Ended March 31, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 85,108 | $ | 9,031 | $ | — | $ | — | $ | 94,139 | |||||||
Construction materials | 59,093 | 59,093 | |||||||||||||||
Energy technology | 3,280 | 3,280 | |||||||||||||||
Total revenue | 147,481 | 9,031 | — | — | 156,512 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 64,458 | 6,370 | 70,828 | ||||||||||||||
Construction materials | 45,669 | 45,669 | |||||||||||||||
Energy technology | 1,464 | 1,464 | |||||||||||||||
Total cost of revenue | 111,591 | 6,370 | — | — | 117,961 | ||||||||||||
Gross profit | 35,890 | 2,661 | — | — | 38,551 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 5,123 | 362 | 5,485 | ||||||||||||||
Selling, general and administrative | 25,610 | 1,142 | 5,765 | 32,517 | |||||||||||||
Total operating expenses | 30,733 | 1,504 | 5,765 | — | 38,002 | ||||||||||||
Operating income (loss) | 5,157 | 1,157 | (5,765 | ) | — | 549 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (146 | ) | (12,088 | ) | (12,234 | ) | |||||||||||
Equity in earnings of subsidiaries | 3,574 | (3,574 | ) | — | |||||||||||||
Other, net | 29 | (61 | ) | (32 | ) | ||||||||||||
Total other income (expense), net | (117 | ) | (61 | ) | (8,514 | ) | (3,574 | ) | (12,266 | ) | |||||||
Income (loss) from continuing operations before income taxes | 5,040 | 1,096 | (14,279 | ) | (3,574 | ) | (11,717 | ) | |||||||||
Income tax benefit (provision) | (1,571 | ) | (180 | ) | 3,961 | 2,210 | |||||||||||
Income (loss) from continuing operations | 3,469 | 916 | (10,318 | ) | (3,574 | ) | (9,507 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (575 | ) | (575 | ) | |||||||||||||
Net income (loss) | 2,894 | 916 | (10,318 | ) | (3,574 | ) | (10,082 | ) | |||||||||
Net income attributable to non-controlling interest | (236 | ) | (236 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 2,894 | $ | 680 | $ | (10,318 | ) | $ | (3,574 | ) | $ | (10,318 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 95,935 | $ | 10,471 | $ | — | $ | — | $ | 106,406 | |||||||
Construction materials | 67,498 | 67,498 | |||||||||||||||
Energy technology | 5,821 | 5,821 | |||||||||||||||
Total revenue | 169,254 | 10,471 | — | — | 179,725 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 72,416 | 7,065 | 79,481 | ||||||||||||||
Construction materials | 50,738 | 50,738 | |||||||||||||||
Energy technology | 2,365 | 2,365 | |||||||||||||||
Total cost of revenue | 125,519 | 7,065 | — | — | 132,584 | ||||||||||||
Gross profit | 43,735 | 3,406 | — | — | 47,141 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 4,191 | 369 | 4,560 | ||||||||||||||
Selling, general and administrative | 26,636 | 1,618 | 6,097 | 34,351 | |||||||||||||
Total operating expenses | 30,827 | 1,987 | 6,097 | — | 38,911 | ||||||||||||
Operating income (loss) | 12,908 | 1,419 | (6,097 | ) | — | 8,230 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (60 | ) | (35,905 | ) | (35,965 | ) | |||||||||||
Equity in earnings of subsidiaries | 12,325 | (12,325 | ) | — | |||||||||||||
Other, net | (62 | ) | 29 | (33 | ) | ||||||||||||
Total other income (expense), net | (122 | ) | 29 | (23,580 | ) | (12,325 | ) | (35,998 | ) | ||||||||
Income (loss) from continuing operations before income taxes | 12,786 | 1,448 | (29,677 | ) | (12,325 | ) | (27,768 | ) | |||||||||
Income tax benefit (provision) | (1,300 | ) | (140 | ) | 4,220 | 2,780 | |||||||||||
Income (loss) from continuing operations | 11,486 | 1,308 | (25,457 | ) | (12,325 | ) | (24,988 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (210 | ) | (210 | ) | |||||||||||||
Net income (loss) | 11,486 | 1,098 | (25,457 | ) | (12,325 | ) | (25,198 | ) | |||||||||
Net income attributable to non-controlling interest | (259 | ) | (259 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 11,486 | $ | 839 | $ | (25,457 | ) | $ | (12,325 | ) | $ | (25,457 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 176,445 | $ | 10,706 | $ | — | $ | — | $ | 187,151 | |||||||
Construction materials | 130,614 | 130,614 | |||||||||||||||
Energy technology | 4,362 | 4,362 | |||||||||||||||
Total revenue | 311,421 | 10,706 | — | — | 322,127 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 132,327 | 7,839 | 140,166 | ||||||||||||||
Construction materials | 100,434 | 100,434 | |||||||||||||||
Energy technology | 2,083 | 2,083 | |||||||||||||||
Total cost of revenue | 234,844 | 7,839 | — | — | 242,683 | ||||||||||||
Gross profit | 76,577 | 2,867 | — | — | 79,444 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 10,229 | 362 | 10,591 | ||||||||||||||
Selling, general and administrative | 48,411 | 1,395 | 10,938 | 60,744 | |||||||||||||
Total operating expenses | 58,640 | 1,757 | 10,938 | — | 71,335 | ||||||||||||
Operating income (loss) | 17,937 | 1,110 | (10,938 | ) | — | 8,109 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (167 | ) | (22,123 | ) | (22,290 | ) | |||||||||||
Equity in earnings of subsidiaries | 15,225 | (15,225 | ) | — | |||||||||||||
Other, net | 74 | (94 | ) | (20 | ) | ||||||||||||
Total other income (expense), net | (93 | ) | (94 | ) | (6,898 | ) | (15,225 | ) | (22,310 | ) | |||||||
Income (loss) from continuing operations before income taxes | 17,844 | 1,016 | (17,836 | ) | (15,225 | ) | (14,201 | ) | |||||||||
Income tax benefit (provision) | (3,350 | ) | (180 | ) | 6,090 | 2,560 | |||||||||||
Income (loss) from continuing operations | 14,494 | 836 | (11,746 | ) | (15,225 | ) | (11,641 | ) | |||||||||
Income from discontinued operations, net of income taxes | 125 | 125 | |||||||||||||||
Net income (loss) | 14,619 | 836 | (11,746 | ) | (15,225 | ) | (11,516 | ) | |||||||||
Net income attributable to non-controlling interest | (230 | ) | (230 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 14,619 | $ | 606 | $ | (11,746 | ) | $ | (15,225 | ) | $ | (11,746 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 202,328 | $ | 21,612 | $ | — | $ | — | $ | 223,940 | |||||||
Construction materials | 148,902 | 148,902 | |||||||||||||||
Energy technology | 6,480 | 6,480 | |||||||||||||||
Total revenue | 357,710 | 21,612 | — | — | 379,322 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 148,934 | 14,739 | 163,673 | ||||||||||||||
Construction materials | 110,249 | 110,249 | |||||||||||||||
Energy technology | 2,572 | 2,572 | |||||||||||||||
Total cost of revenue | 261,755 | 14,739 | — | — | 276,494 | ||||||||||||
Gross profit | 95,955 | 6,873 | — | — | 102,828 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 8,309 | 737 | 9,046 | ||||||||||||||
Selling, general and administrative | 52,438 | 3,192 | 10,750 | 66,380 | |||||||||||||
Total operating expenses | 60,747 | 3,929 | 10,750 | — | 75,426 | ||||||||||||
Operating income (loss) | 35,208 | 2,944 | (10,750 | ) | — | 27,402 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (104 | ) | (47,813 | ) | (47,917 | ) | |||||||||||
Equity in earnings of subsidiaries | 34,125 | (34,125 | ) | — | |||||||||||||
Other, net | (142 | ) | (160 | ) | (302 | ) | |||||||||||
Total other income (expense), net | (246 | ) | (160 | ) | (13,688 | ) | (34,125 | ) | (48,219 | ) | |||||||
Income (loss) from continuing operations before income taxes | 34,962 | 2,784 | (24,438 | ) | (34,125 | ) | (20,817 | ) | |||||||||
Income tax benefit (provision) | (2,570 | ) | (270 | ) | 5,820 | 2,980 | |||||||||||
Income(loss) from continuing operations | 32,392 | 2,514 | (18,618 | ) | (34,125 | ) | (17,837 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (67 | ) | (210 | ) | (277 | ) | |||||||||||
Net income (loss) | 32,325 | 2,304 | (18,618 | ) | (34,125 | ) | (18,114 | ) | |||||||||
Net income attributable to non-controlling interest | (504 | ) | (504 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 32,325 | $ | 1,800 | $ | (18,618 | ) | $ | (34,125 | ) | $ | (18,618 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
Non- | |||||||||||||||||
Guarantor | guarantor | Parent | Headwaters | ||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 14,619 | $ | 836 | $ | (11,746 | ) | $ | (15,225 | ) | $ | (11,516 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and amortization | 25,582 | 748 | 130 | 26,460 | |||||||||||||
Interest expense related to amortization of debt issue costs and debt discount | 1,153 | 1,153 | |||||||||||||||
Stock-based compensation | 404 | 612 | 1,016 | ||||||||||||||
Deferred income taxes | 214 | 214 | |||||||||||||||
Net gain on disposition of property, plant and equipment | 328 | 45 | 373 | ||||||||||||||
Gain on sale of discontinued operations, net of income taxes | (3,117 | ) | (3,117 | ) | |||||||||||||
Net loss of unconsolidated joint ventures | 133 | 133 | |||||||||||||||
Equity in earnings of subsidiaries | (15,225 | ) | 15,225 | — | |||||||||||||
Decrease in trade receivables | 30,264 | 647 | 30,911 | ||||||||||||||
Decrease (increase) in inventories | (11,139 | ) | 1,385 | (9,754 | ) | ||||||||||||
Decrease in accounts payable and accrued liabilities | (21,882 | ) | (331 | ) | (1,385 | ) | (23,598 | ) | |||||||||
Other changes in operating assets and liabilities, net | (15,224 | ) | 1,320 | 8,374 | (5,530 | ) | |||||||||||
Net cash provided by (used in) operating activities | 20,049 | 4,738 | (18,042 | ) | — | 6,745 | |||||||||||
Cash flows from investing activities: | |||||||||||||||||
Payments for acquisitions | (3,100 | ) | (57,519 | ) | (60,619 | ) | |||||||||||
Payments for investments in unconsolidated joint ventures | (1,000 | ) | (1,000 | ) | |||||||||||||
Purchase of property, plant and equipment | (13,505 | ) | (678 | ) | (1,761 | ) | (15,944 | ) | |||||||||
Proceeds from disposition of property, plant and equipment | 358 | 358 | |||||||||||||||
Proceeds from sale of discontinued operations | 4,666 | 4,666 | |||||||||||||||
Net decrease in long-term receivables and deposits | 5,527 | 298 | 5,825 | ||||||||||||||
Net change in other assets | (192 | ) | 216 | 24 | |||||||||||||
Net cash used in investing activities | (6,246 | ) | (1,678 | ) | (58,766 | ) | — | (66,690 | ) | ||||||||
Cash flows from financing activities: | |||||||||||||||||
Net proceeds from issuance of long-term debt | 146,200 | 146,200 | |||||||||||||||
Payments on long-term debt | (7,792 | ) | (7,792 | ) | |||||||||||||
Employee stock purchases | 344 | 110 | 454 | ||||||||||||||
Net cash provided by financing activities | 344 | — | 138,518 | — | 138,862 | ||||||||||||
Net increase in cash and cash equivalents | 14,147 | 3,060 | 61,710 | — | 78,917 | ||||||||||||
Cash and cash equivalents, beginning of period | 70,713 | 34 | 4,569 | 75,316 | |||||||||||||
Cash and cash equivalents, end of period | $ | 84,860 | $ | 3,094 | $ | 66,279 | $ | — | $ | 154,233 | |||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
Non- | |||||||||||||||||
Guarantor | guarantor | Parent | Headwaters | ||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 32,325 | $ | 2,304 | $ | (18,618 | ) | $ | (34,125 | ) | $ | (18,114 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and amortization | 24,223 | 1,421 | 212 | 25,856 | |||||||||||||
Interest expense related to amortization of debt issue costs and debt discount | 5,042 | 5,042 | |||||||||||||||
Stock-based compensation | 496 | 843 | 1,339 | ||||||||||||||
Deferred income taxes | 295 | 182 | 477 | ||||||||||||||
Net loss on disposition of property, plant and equipment | 112 | 1 | 113 | ||||||||||||||
Loss on sale of discontinued operations, net of income taxes | 45 | 196 | 241 | ||||||||||||||
Net loss of unconsolidated joint ventures | 234 | 234 | |||||||||||||||
Equity in earnings of subsidiaries | (34,125 | ) | 34,125 | 0 | |||||||||||||
Decrease (increase) in trade receivables | 28,597 | (250 | ) | 28,347 | |||||||||||||
Increase in inventories | (10,071 | ) | (557 | ) | (10,628 | ) | |||||||||||
Increase (decrease) in accounts payable and accrued liabilities | (23,170 | ) | 2,248 | (26,658 | ) | (47,580 | ) | ||||||||||
Other changes in operating assets and liabilities, net | 2,554 | (7,521 | ) | (3,802 | ) | (8,769 | ) | ||||||||||
Net cash provided by (used in) operating activities | 55,406 | (1,742 | ) | (77,106 | ) | — | (23,442 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||||||
Business acquisition | (1,200 | ) | (1,200 | ) | |||||||||||||
Investments in unconsolidated joint venture | (125 | ) | (125 | ) | |||||||||||||
Purchase of property, plant and equipment | (14,496 | ) | (259 | ) | (2,719 | ) | (17,474 | ) | |||||||||
Proceeds from disposition of property, plant and equipment | 640 | 640 | |||||||||||||||
Net decrease in long-term receivables and deposits | 2,584 | 1,066 | 3,650 | ||||||||||||||
Net change in other assets | (437 | ) | 93 | (344 | ) | ||||||||||||
Net cash used in investing activities | (13,034 | ) | (259 | ) | (1,560 | ) | — | (14,853 | ) | ||||||||
Cash flows from financing activities: | |||||||||||||||||
Net proceeds from issuance of long-term debt | 414,675 | 414,675 | |||||||||||||||
Payments on long-term debt | (448,736 | ) | (448,736 | ) | |||||||||||||
Dividends paid to non-controlling interest in consolidated subsidiary | (927 | ) | (927 | ) | |||||||||||||
Employee stock purchases | 342 | 16 | 106 | 464 | |||||||||||||
Intercompany transfers | (39,633 | ) | 123 | 39,510 | 0 | ||||||||||||
Net cash provided by (used in) financing activities | (39,291 | ) | (788 | ) | 5,555 | — | (34,524 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents | 3,081 | (2,789 | ) | (73,111 | ) | — | (72,819 | ) | |||||||||
Cash and cash equivalents, beginning of period | 33,552 | 5,764 | 113,226 | 152,542 | |||||||||||||
Cash and cash equivalents, end of period | $ | 36,633 | $ | 2,975 | $ | 40,115 | $ | — | $ | 79,723 | |||||||
Segment_Reporting_Tables
Segment Reporting (Tables) | 6 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Segment Reporting | |||||||||||||||||
Schedule Of Segment Reporting | |||||||||||||||||
Three Months Ended March 31, 2014 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 94,139 | $ | 59,093 | $ | 3,280 | $ | 0 | $ | 156,512 | |||||||
Depreciation and amortization | $ | (9,546 | ) | $ | (3,319 | ) | $ | (479 | ) | $ | (69 | ) | $ | (13,413 | ) | ||
Operating income (loss) | $ | 1,907 | $ | 5,228 | $ | (821 | ) | $ | (5,765 | ) | $ | 549 | |||||
Net interest expense | (12,234 | ) | |||||||||||||||
Other income (expense), net | (32 | ) | |||||||||||||||
Income tax benefit | 2,210 | ||||||||||||||||
Loss from continuing operations | (9,507 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (575 | ) | |||||||||||||||
Net loss | $ | (10,082 | ) | ||||||||||||||
Capital expenditures | $ | 6,864 | $ | 1,377 | $ | 75 | $ | 740 | $ | 9,056 | |||||||
Segment assets as of September 30, 2014 | $ | 411,968 | $ | 325,140 | $ | 22,674 | $ | 136,524 | $ | 896,306 | |||||||
Three Months Ended March 31, 2015 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 106,406 | $ | 67,498 | $ | 5,821 | $ | 0 | $ | 179,725 | |||||||
Depreciation and amortization | $ | (8,702 | ) | $ | (3,799 | ) | $ | (341 | ) | $ | (104 | ) | $ | (12,946 | ) | ||
Operating income (loss) | $ | 4,679 | $ | 8,175 | $ | 1,473 | $ | (6,097 | ) | $ | 8,230 | ||||||
Net interest expense | (35,965 | ) | |||||||||||||||
Other income (expense), net | (33 | ) | |||||||||||||||
Income tax benefit | 2,780 | ||||||||||||||||
Loss from continuing operations | (24,988 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (210 | ) | |||||||||||||||
Net loss | $ | (25,198 | ) | ||||||||||||||
Capital expenditures | $ | 6,131 | $ | 1,026 | $ | 61 | $ | 1,485 | $ | 8,703 | |||||||
Segment assets as of March 31, 2015 | $ | 396,568 | $ | 308,750 | $ | 27,131 | $ | 70,787 | $ | 803,236 | |||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 187,151 | $ | 130,614 | $ | 4,362 | $ | 0 | $ | 322,127 | |||||||
Depreciation and amortization | $ | (18,758 | ) | $ | (6,605 | ) | $ | (967 | ) | $ | (130 | ) | $ | (26,460 | ) | ||
Operating income (loss) | $ | 6,993 | $ | 15,161 | $ | (3,107 | ) | $ | (10,938 | ) | $ | 8,109 | |||||
Net interest expense | (22,290 | ) | |||||||||||||||
Other income (expense), net | (20 | ) | |||||||||||||||
Income tax benefit | 2,560 | ||||||||||||||||
Loss from continuing operations | (11,641 | ) | |||||||||||||||
Income from discontinued operations, net of income taxes | 125 | ||||||||||||||||
Net loss | $ | (11,516 | ) | ||||||||||||||
Capital expenditures | $ | 11,316 | $ | 2,562 | $ | 305 | $ | 1,761 | $ | 15,944 | |||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
(in thousands) | Building | Construction | Energy | Corporate | Totals | ||||||||||||
products | materials | technology | |||||||||||||||
Segment revenue | $ | 223,940 | $ | 148,902 | $ | 6,480 | $ | 0 | $ | 379,322 | |||||||
Depreciation and amortization | $ | (17,415 | ) | $ | (7,535 | ) | $ | (694 | ) | $ | (212 | ) | $ | (25,856 | ) | ||
Operating income (loss) | $ | 16,627 | $ | 21,663 | $ | (138 | ) | $ | (10,750 | ) | $ | 27,402 | |||||
Net interest expense | (47,917 | ) | |||||||||||||||
Other income (expense), net | (302 | ) | |||||||||||||||
Income tax benefit | 2,980 | ||||||||||||||||
Loss from continuing operations | (17,837 | ) | |||||||||||||||
Loss from discontinued operations, net of income taxes | (277 | ) | |||||||||||||||
Net loss | $ | (18,114 | ) | ||||||||||||||
Capital expenditures | $ | 12,152 | $ | 2,374 | $ | 229 | $ | 2,719 | $ | 17,474 | |||||||
Acquisitions_Tables
Acquisitions (Tables) | 6 Months Ended | ||||
Mar. 31, 2015 | |||||
Acquisitions | |||||
Schedule of activity of non-controlling interest | |||||
(in thousands) | |||||
Balance as of September 30, 2014 | $ | 13,252 | |||
Net income attributable to non-controlling interest | 504 | ||||
Dividends paid to non-controlling interest | (927 | ) | |||
Balance as of March 31, 2015 | $ | 12,829 | |||
Entegra | |||||
Acquisitions | |||||
Schedule of estimated fair values of assets acquired and liabilities assumed as of the acquisition date | |||||
(in thousands) | |||||
Current assets | $ | 8,261 | |||
Current liabilities | (3,422 | ) | |||
Property, plant and equipment | 10,589 | ||||
Intangible assets: | |||||
Customer relationships (15 year life) | 20,600 | ||||
Trade name (indefinite life) | 6,600 | ||||
Goodwill | 28,156 | ||||
Net assets acquired | 70,784 | ||||
Less redeemable non-controlling interest | (13,252 | ) | |||
Net assets attributable to Headwaters | $ | 57,532 | |||
Gerard | |||||
Acquisitions | |||||
Schedule of estimated fair values of assets acquired and liabilities assumed as of the acquisition date | |||||
(in thousands) | |||||
Current assets | $ | 9,236 | |||
Current liabilities | (1,691 | ) | |||
Property, plant and equipment | 8,314 | ||||
Intangible assets: | |||||
Customer relationships (15 year life) | 4,000 | ||||
Trade name (indefinite life) | 3,900 | ||||
Goodwill | 7,719 | ||||
Long-term liabilities | (3,906 | ) | |||
Net assets acquired | $ | 27,572 | |||
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 6 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Discontinued Operations | ||||||||||||||
Schedule Of Information For The Discontinued Coal Cleaning Business | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
March 31, | March 31, | |||||||||||||
(in thousands) | 2014 | 2015 | 2014 | 2015 | ||||||||||
Revenue | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||
Loss from operations of discontinued operations before income taxes | $ | (2,728 | ) | $ | (14 | ) | $ | (2,992 | ) | $ | (36 | ) | ||
Gain (loss) on disposal | 2,153 | (196 | ) | 3,117 | (241 | ) | ||||||||
Income tax provision | 0 | 0 | 0 | 0 | ||||||||||
Income (loss) from discontinued operations, net of income taxes | $ | (575 | ) | $ | (210 | ) | $ | 125 | $ | (277 | ) | |||
Inventories_Tables
Inventories (Tables) | 6 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Inventories | ||||||||
Schedule of components of inventory | (in thousands) | September 30, 2014 | March 31, 2015 | |||||
Raw materials | $ | 12,017 | $ | 13,645 | ||||
Finished goods | 38,616 | 49,920 | ||||||
$ | 50,633 | $ | 63,565 | |||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 6 Months Ended | |||||||||||||||
Mar. 31, 2015 | ||||||||||||||||
Intangible Assets | ||||||||||||||||
Schedule of gross carrying amounts and accumulated amortization of intangible assets | ||||||||||||||||
September 30, 2014 | March 31, 2015 | |||||||||||||||
(in thousands of dollars) | Estimated | Gross | Accumulated | Gross | Accumulated | |||||||||||
useful lives | Carrying | Amortization | Carrying | Amortization | ||||||||||||
Amount | Amount | |||||||||||||||
Trade names | Indefinite | $ | 15,300 | $ | — | $ | 15,300 | $ | — | |||||||
CCP contracts | 15 - 20 years | 112,300 | 64,192 | 112,300 | 67,033 | |||||||||||
Customer relationships | 5 - 17 years | 107,953 | 50,355 | 109,299 | 54,188 | |||||||||||
Trade names | 5 - 20 years | 67,220 | 33,394 | 67,220 | 35,104 | |||||||||||
Patents and patented technologies | 5 - 19 years | 14,526 | 11,686 | 14,526 | 12,130 | |||||||||||
Other | 5 - 17 years | 3,935 | 1,744 | 4,584 | 1,962 | |||||||||||
$ | 321,234 | $ | 161,371 | $ | 323,229 | $ | 170,417 | |||||||||
Schedule of total currently estimated annual amortization expense | ||||||||||||||||
Year ending September 30: | (in thousands) | |||||||||||||||
2015 | $ | 18,166 | ||||||||||||||
2016 | 17,957 | |||||||||||||||
2017 | 17,079 | |||||||||||||||
2018 | 17,030 | |||||||||||||||
2019 | 16,001 | |||||||||||||||
2020 | 11,762 | |||||||||||||||
Longterm_Debt_Tables
Long-term Debt (Tables) | 6 Months Ended | |||||||
Mar. 31, 2015 | ||||||||
Long-term Debt | ||||||||
Schedule of the discounted carrying value of long-term debt | ||||||||
(in thousands) | September 30, | March 31, | ||||||
2014 | 2015 | |||||||
Senior secured term loan, due March 2022 (face amount $425,000) | $ | 0 | $ | 414,801 | ||||
7¼% Senior notes, due January 2019 (face amount $150,000) | 147,192 | 147,516 | ||||||
7-5/8% Senior secured notes, repaid in March 2015 (face amount $400,000) | 396,058 | 0 | ||||||
8.75% Convertible senior subordinated notes, repaid in February 2015 (face amount $49,791) | 49,208 | 0 | ||||||
Carrying amount of long-term debt, net of discounts and debt issue costs | 592,458 | 562,317 | ||||||
Less current portion | 0 | (3,188 | ) | |||||
Long-term debt | $ | 592,458 | $ | 559,129 | ||||
Earnings_per_Share_Tables
Earnings per Share (Tables) | 6 Months Ended | |||||||||||||
Mar. 31, 2015 | ||||||||||||||
Earnings per Share | ||||||||||||||
Schedule of computation of basic and diluted EPS | ||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||
March 31, | March 31, | |||||||||||||
(in thousands, except per-share amounts) | 2014 | 2015 | 2014 | 2015 | ||||||||||
Numerator: | ||||||||||||||
Loss from continuing operations | $ | (9,507 | ) | $ | (24,988 | ) | $ | (11,641 | ) | $ | (17,837 | ) | ||
Income from continuing operations attributable to non-controlling interest | (236 | ) | (259 | ) | (230 | ) | (504 | ) | ||||||
Adjustment of estimated redemption value of non-controlling interest | 0 | 276 | 0 | 0 | ||||||||||
Numerator for basic and diluted earnings per share from continuing operations — loss from continuing operations attributable to Headwaters Incorporated | (9,743 | ) | (24,971 | ) | (11,871 | ) | (18,341 | ) | ||||||
Numerator for basic and diluted earnings per share from discontinued operations — income (loss) from discontinued operations, net of income taxes | (575 | ) | (210 | ) | 125 | (277 | ) | |||||||
Numerator for basic and diluted earnings per share — net loss attributable to Headwaters Incorporated | $ | (10,318 | ) | $ | (25,181 | ) | $ | (11,746 | ) | $ | (18,618 | ) | ||
Denominator: | ||||||||||||||
Denominator for basic and diluted earnings per share — weighted-average shares outstanding | 73,121 | 73,555 | 73,094 | 73,501 | ||||||||||
Basic and diluted income (loss) per share attributable to Headwaters Incorporated: | ||||||||||||||
From continuing operations | $ | (0.13 | ) | $ | (0.34 | ) | $ | (0.16 | ) | $ | (0.25 | ) | ||
From discontinued operations | (0.01 | ) | (0.00 | ) | 0 | (0.00 | ) | |||||||
$ | (0.14 | ) | $ | (0.34 | ) | $ | (0.16 | ) | $ | (0.25 | ) | |||
Anti-dilutive securities not considered in diluted EPS calculation: | ||||||||||||||
Stock-settled SARs | 3,821 | 3,811 | 3,879 | 2,358 | ||||||||||
Stock options | 594 | 105 | 606 | 105 | ||||||||||
Restricted stock | 253 | 264 | 253 | 132 | ||||||||||
Condensed_Consolidating_Financ1
Condensed Consolidating Financial Information (Tables) | 6 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Condensed Consolidating Financial Information | |||||||||||||||||
Schedule of condensed consolidating balance sheet | |||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEET — September 30, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Eliminations | Headwaters | |||||||||||||
guarantor | and | ||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Reclassifications | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 33,552 | $ | 5,764 | $ | 113,226 | $ | — | $ | 152,542 | |||||||
Trade receivables, net | 113,940 | 5,390 | 119,330 | ||||||||||||||
Inventories | 48,482 | 2,151 | 50,633 | ||||||||||||||
Deferred income taxes | 15,509 | 289 | 18,427 | (23,149 | ) | 11,076 | |||||||||||
Other | 9,286 | 168 | 1,082 | 10,536 | |||||||||||||
Total current assets | 220,769 | 13,762 | 132,735 | (23,149 | ) | 344,117 | |||||||||||
Property, plant and equipment, net | 162,458 | 11,674 | 7,979 | — | 182,111 | ||||||||||||
Other assets: | |||||||||||||||||
Goodwill | 145,068 | 30,518 | 175,586 | ||||||||||||||
Intangible assets, net | 131,150 | 28,713 | 159,863 | ||||||||||||||
Investments in subsidiaries | 406,327 | (406,327 | ) | — | |||||||||||||
Intercompany accounts and notes | 637,046 | (637,046 | ) | — | |||||||||||||
Deferred income taxes | 41,658 | 22,928 | (64,586 | ) | — | ||||||||||||
Other | 14,388 | 1,381 | 18,860 | 34,629 | |||||||||||||
Total other assets | 332,264 | 60,612 | 1,085,161 | (1,107,959 | ) | 370,078 | |||||||||||
Total assets | $ | 715,491 | $ | 86,048 | $ | 1,225,875 | $ | (1,131,108 | ) | $ | 896,306 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | |||||||||||||||||
Accounts payable | $ | 25,643 | $ | 956 | $ | 427 | $ | — | $ | 27,026 | |||||||
Accrued personnel costs | 13,483 | 418 | 35,001 | 48,902 | |||||||||||||
Accrued interest | 18,273 | 18,273 | |||||||||||||||
Current income taxes | 23,198 | 319 | (23,149 | ) | 368 | ||||||||||||
Other accrued liabilities | 36,811 | 3,006 | 1,940 | 41,757 | |||||||||||||
Total current liabilities | 99,135 | 4,699 | 55,641 | (23,149 | ) | 136,326 | |||||||||||
Long-term liabilities: | |||||||||||||||||
Long-term debt, net | 592,458 | 592,458 | |||||||||||||||
Income taxes | 65,133 | 893 | 21,802 | (64,586 | ) | 23,242 | |||||||||||
Intercompany accounts and notes | 191,274 | 4,061 | 441,711 | (637,046 | ) | — | |||||||||||
Other | 16,167 | 774 | 11,645 | 28,586 | |||||||||||||
Total long-term liabilities | 272,574 | 5,728 | 1,067,616 | (701,632 | ) | 644,286 | |||||||||||
Total liabilities | 371,709 | 10,427 | 1,123,257 | (724,781 | ) | 780,612 | |||||||||||
Redeemable non-controlling interest in consolidated subsidiary | 13,252 | 13,252 | |||||||||||||||
Stockholders’ equity: | |||||||||||||||||
Common stock | 74 | 74 | |||||||||||||||
Capital in excess of par value | 458,498 | 60,453 | 723,824 | (519,127 | ) | 723,648 | |||||||||||
Retained earnings (accumulated deficit) | (114,716 | ) | 1,916 | (620,688 | ) | 112,800 | (620,688 | ) | |||||||||
Treasury stock | (592 | ) | (592 | ) | |||||||||||||
Total stockholders’ equity | 343,782 | 62,369 | 102,618 | (406,327 | ) | 102,442 | |||||||||||
Total liabilities and stockholders’ equity | $ | 715,491 | $ | 86,048 | $ | 1,225,875 | $ | (1,131,108 | ) | $ | 896,306 | ||||||
CON DENSED CONSOLIDATING BALANCE SHEET — March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Eliminations | Headwaters | |||||||||||||
guarantor | and | ||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Reclassifications | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Current assets: | |||||||||||||||||
Cash and cash equivalents | $ | 36,633 | $ | 2,975 | $ | 40,115 | $ | — | $ | 79,723 | |||||||
Trade receivables, net | 85,726 | 5,640 | 91,366 | ||||||||||||||
Inventories | 60,857 | 2,708 | 63,565 | ||||||||||||||
Current and deferred income taxes | 7,196 | 27,998 | 44,780 | (68,756 | ) | 11,218 | |||||||||||
Other | 10,596 | 163 | 1,387 | 12,146 | |||||||||||||
Total current assets | 201,008 | 39,484 | 86,282 | (68,756 | ) | 258,018 | |||||||||||
Property, plant and equipment, net | 162,422 | 10,304 | 9,523 | — | 182,249 | ||||||||||||
Other assets: | |||||||||||||||||
Goodwill | 144,643 | 30,869 | 175,512 | ||||||||||||||
Intangible assets, net | 124,836 | 27,976 | 152,812 | ||||||||||||||
Investments in subsidiaries | 46,273 | 474,868 | (521,141 | ) | — | ||||||||||||
Intercompany accounts and notes | 637,046 | (637,046 | ) | — | |||||||||||||
Deferred income taxes | 50,188 | 23,589 | (73,777 | ) | — | ||||||||||||
Other | 10,894 | 2,180 | 21,571 | 34,645 | |||||||||||||
Total other assets | 376,834 | 61,025 | 1,157,074 | (1,231,964 | ) | 362,969 | |||||||||||
Total assets | $ | 740,264 | $ | 110,813 | $ | 1,252,879 | $ | (1,300,720 | ) | $ | 803,236 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
Current liabilities: | |||||||||||||||||
Accounts payable | $ | 17,904 | $ | 908 | $ | 1,008 | $ | — | $ | 19,820 | |||||||
Accrued personnel costs | 9,551 | 598 | 22,426 | 32,575 | |||||||||||||
Accrued interest | 2,721 | 2,721 | |||||||||||||||
Current income taxes | 47,658 | 21,098 | (68,756 | ) | — | ||||||||||||
Other accrued liabilities | 27,939 | 5,122 | 3,988 | 37,049 | |||||||||||||
Current portion of long-term debt | 3,188 | 3,188 | |||||||||||||||
Total current liabilities | 103,052 | 6,628 | 54,429 | (68,756 | ) | 95,353 | |||||||||||
Long-term liabilities: | |||||||||||||||||
Long-term debt, net | 559,129 | 559,129 | |||||||||||||||
Income taxes | 64,117 | 7,310 | 21,289 | (73,777 | ) | 18,939 | |||||||||||
Intercompany accounts and notes | 177,035 | 516,660 | (693,695 | ) | — | ||||||||||||
Other | 333 | 15,457 | 15,569 | 31,359 | |||||||||||||
Total long-term liabilities | 64,450 | 199,802 | 1,112,647 | (767,472 | ) | 609,427 | |||||||||||
Total liabilities | 167,502 | 206,430 | 1,167,076 | (836,228 | ) | 704,780 | |||||||||||
Redeemable non-controlling interest in consolidated subsidiary | 12,829 | 12,829 | |||||||||||||||
Stockholders’ equity: | |||||||||||||||||
Common stock | 74 | 74 | |||||||||||||||
Capital in excess of par value | 486,069 | 56,922 | 725,791 | (543,167 | ) | 725,615 | |||||||||||
Retained earnings (accumulated deficit) | 86,693 | (165,368 | ) | (639,306 | ) | 78,675 | (639,306 | ) | |||||||||
Treasury stock | (756 | ) | (756 | ) | |||||||||||||
Total stockholders’ equity | 572,762 | (108,446 | ) | 85,803 | (464,492 | ) | 85,627 | ||||||||||
Total liabilities and stockholders’ equity | $ | 740,264 | $ | 110,813 | $ | 1,252,879 | $ | (1,300,720 | ) | $ | 803,236 | ||||||
Schedule of condensed consolidating statement of operations | |||||||||||||||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Three Months Ended March 31, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 85,108 | $ | 9,031 | $ | — | $ | — | $ | 94,139 | |||||||
Construction materials | 59,093 | 59,093 | |||||||||||||||
Energy technology | 3,280 | 3,280 | |||||||||||||||
Total revenue | 147,481 | 9,031 | — | — | 156,512 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 64,458 | 6,370 | 70,828 | ||||||||||||||
Construction materials | 45,669 | 45,669 | |||||||||||||||
Energy technology | 1,464 | 1,464 | |||||||||||||||
Total cost of revenue | 111,591 | 6,370 | — | — | 117,961 | ||||||||||||
Gross profit | 35,890 | 2,661 | — | — | 38,551 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 5,123 | 362 | 5,485 | ||||||||||||||
Selling, general and administrative | 25,610 | 1,142 | 5,765 | 32,517 | |||||||||||||
Total operating expenses | 30,733 | 1,504 | 5,765 | — | 38,002 | ||||||||||||
Operating income (loss) | 5,157 | 1,157 | (5,765 | ) | — | 549 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (146 | ) | (12,088 | ) | (12,234 | ) | |||||||||||
Equity in earnings of subsidiaries | 3,574 | (3,574 | ) | — | |||||||||||||
Other, net | 29 | (61 | ) | (32 | ) | ||||||||||||
Total other income (expense), net | (117 | ) | (61 | ) | (8,514 | ) | (3,574 | ) | (12,266 | ) | |||||||
Income (loss) from continuing operations before income taxes | 5,040 | 1,096 | (14,279 | ) | (3,574 | ) | (11,717 | ) | |||||||||
Income tax benefit (provision) | (1,571 | ) | (180 | ) | 3,961 | 2,210 | |||||||||||
Income (loss) from continuing operations | 3,469 | 916 | (10,318 | ) | (3,574 | ) | (9,507 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (575 | ) | (575 | ) | |||||||||||||
Net income (loss) | 2,894 | 916 | (10,318 | ) | (3,574 | ) | (10,082 | ) | |||||||||
Net income attributable to non-controlling interest | (236 | ) | (236 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 2,894 | $ | 680 | $ | (10,318 | ) | $ | (3,574 | ) | $ | (10,318 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Three Months Ended March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 95,935 | $ | 10,471 | $ | — | $ | — | $ | 106,406 | |||||||
Construction materials | 67,498 | 67,498 | |||||||||||||||
Energy technology | 5,821 | 5,821 | |||||||||||||||
Total revenue | 169,254 | 10,471 | — | — | 179,725 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 72,416 | 7,065 | 79,481 | ||||||||||||||
Construction materials | 50,738 | 50,738 | |||||||||||||||
Energy technology | 2,365 | 2,365 | |||||||||||||||
Total cost of revenue | 125,519 | 7,065 | — | — | 132,584 | ||||||||||||
Gross profit | 43,735 | 3,406 | — | — | 47,141 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 4,191 | 369 | 4,560 | ||||||||||||||
Selling, general and administrative | 26,636 | 1,618 | 6,097 | 34,351 | |||||||||||||
Total operating expenses | 30,827 | 1,987 | 6,097 | — | 38,911 | ||||||||||||
Operating income (loss) | 12,908 | 1,419 | (6,097 | ) | — | 8,230 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (60 | ) | (35,905 | ) | (35,965 | ) | |||||||||||
Equity in earnings of subsidiaries | 12,325 | (12,325 | ) | — | |||||||||||||
Other, net | (62 | ) | 29 | (33 | ) | ||||||||||||
Total other income (expense), net | (122 | ) | 29 | (23,580 | ) | (12,325 | ) | (35,998 | ) | ||||||||
Income (loss) from continuing operations before income taxes | 12,786 | 1,448 | (29,677 | ) | (12,325 | ) | (27,768 | ) | |||||||||
Income tax benefit (provision) | (1,300 | ) | (140 | ) | 4,220 | 2,780 | |||||||||||
Income (loss) from continuing operations | 11,486 | 1,308 | (25,457 | ) | (12,325 | ) | (24,988 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (210 | ) | (210 | ) | |||||||||||||
Net income (loss) | 11,486 | 1,098 | (25,457 | ) | (12,325 | ) | (25,198 | ) | |||||||||
Net income attributable to non-controlling interest | (259 | ) | (259 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 11,486 | $ | 839 | $ | (25,457 | ) | $ | (12,325 | ) | $ | (25,457 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 176,445 | $ | 10,706 | $ | — | $ | — | $ | 187,151 | |||||||
Construction materials | 130,614 | 130,614 | |||||||||||||||
Energy technology | 4,362 | 4,362 | |||||||||||||||
Total revenue | 311,421 | 10,706 | — | — | 322,127 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 132,327 | 7,839 | 140,166 | ||||||||||||||
Construction materials | 100,434 | 100,434 | |||||||||||||||
Energy technology | 2,083 | 2,083 | |||||||||||||||
Total cost of revenue | 234,844 | 7,839 | — | — | 242,683 | ||||||||||||
Gross profit | 76,577 | 2,867 | — | — | 79,444 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 10,229 | 362 | 10,591 | ||||||||||||||
Selling, general and administrative | 48,411 | 1,395 | 10,938 | 60,744 | |||||||||||||
Total operating expenses | 58,640 | 1,757 | 10,938 | — | 71,335 | ||||||||||||
Operating income (loss) | 17,937 | 1,110 | (10,938 | ) | — | 8,109 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (167 | ) | (22,123 | ) | (22,290 | ) | |||||||||||
Equity in earnings of subsidiaries | 15,225 | (15,225 | ) | — | |||||||||||||
Other, net | 74 | (94 | ) | (20 | ) | ||||||||||||
Total other income (expense), net | (93 | ) | (94 | ) | (6,898 | ) | (15,225 | ) | (22,310 | ) | |||||||
Income (loss) from continuing operations before income taxes | 17,844 | 1,016 | (17,836 | ) | (15,225 | ) | (14,201 | ) | |||||||||
Income tax benefit (provision) | (3,350 | ) | (180 | ) | 6,090 | 2,560 | |||||||||||
Income (loss) from continuing operations | 14,494 | 836 | (11,746 | ) | (15,225 | ) | (11,641 | ) | |||||||||
Income from discontinued operations, net of income taxes | 125 | 125 | |||||||||||||||
Net income (loss) | 14,619 | 836 | (11,746 | ) | (15,225 | ) | (11,516 | ) | |||||||||
Net income attributable to non-controlling interest | (230 | ) | (230 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 14,619 | $ | 606 | $ | (11,746 | ) | $ | (15,225 | ) | $ | (11,746 | ) | ||||
CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS | |||||||||||||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
Guarantor | Non- | Parent | Headwaters | ||||||||||||||
guarantor | |||||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Revenue: | |||||||||||||||||
Building products | $ | 202,328 | $ | 21,612 | $ | — | $ | — | $ | 223,940 | |||||||
Construction materials | 148,902 | 148,902 | |||||||||||||||
Energy technology | 6,480 | 6,480 | |||||||||||||||
Total revenue | 357,710 | 21,612 | — | — | 379,322 | ||||||||||||
Cost of revenue: | |||||||||||||||||
Building products | 148,934 | 14,739 | 163,673 | ||||||||||||||
Construction materials | 110,249 | 110,249 | |||||||||||||||
Energy technology | 2,572 | 2,572 | |||||||||||||||
Total cost of revenue | 261,755 | 14,739 | — | — | 276,494 | ||||||||||||
Gross profit | 95,955 | 6,873 | — | — | 102,828 | ||||||||||||
Operating expenses: | |||||||||||||||||
Amortization | 8,309 | 737 | 9,046 | ||||||||||||||
Selling, general and administrative | 52,438 | 3,192 | 10,750 | 66,380 | |||||||||||||
Total operating expenses | 60,747 | 3,929 | 10,750 | — | 75,426 | ||||||||||||
Operating income (loss) | 35,208 | 2,944 | (10,750 | ) | — | 27,402 | |||||||||||
Other income (expense): | |||||||||||||||||
Net interest expense | (104 | ) | (47,813 | ) | (47,917 | ) | |||||||||||
Equity in earnings of subsidiaries | 34,125 | (34,125 | ) | — | |||||||||||||
Other, net | (142 | ) | (160 | ) | (302 | ) | |||||||||||
Total other income (expense), net | (246 | ) | (160 | ) | (13,688 | ) | (34,125 | ) | (48,219 | ) | |||||||
Income (loss) from continuing operations before income taxes | 34,962 | 2,784 | (24,438 | ) | (34,125 | ) | (20,817 | ) | |||||||||
Income tax benefit (provision) | (2,570 | ) | (270 | ) | 5,820 | 2,980 | |||||||||||
Income(loss) from continuing operations | 32,392 | 2,514 | (18,618 | ) | (34,125 | ) | (17,837 | ) | |||||||||
Loss from discontinued operations, net of income taxes | (67 | ) | (210 | ) | (277 | ) | |||||||||||
Net income (loss) | 32,325 | 2,304 | (18,618 | ) | (34,125 | ) | (18,114 | ) | |||||||||
Net income attributable to non-controlling interest | (504 | ) | (504 | ) | |||||||||||||
Net income (loss) attributable to Headwaters Incorporated | $ | 32,325 | $ | 1,800 | $ | (18,618 | ) | $ | (34,125 | ) | $ | (18,618 | ) | ||||
Schedule of condensed consolidating statement of cash flows | |||||||||||||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Six Months Ended March 31, 2014 | |||||||||||||||||
Non- | |||||||||||||||||
Guarantor | guarantor | Parent | Headwaters | ||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 14,619 | $ | 836 | $ | (11,746 | ) | $ | (15,225 | ) | $ | (11,516 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and amortization | 25,582 | 748 | 130 | 26,460 | |||||||||||||
Interest expense related to amortization of debt issue costs and debt discount | 1,153 | 1,153 | |||||||||||||||
Stock-based compensation | 404 | 612 | 1,016 | ||||||||||||||
Deferred income taxes | 214 | 214 | |||||||||||||||
Net gain on disposition of property, plant and equipment | 328 | 45 | 373 | ||||||||||||||
Gain on sale of discontinued operations, net of income taxes | (3,117 | ) | (3,117 | ) | |||||||||||||
Net loss of unconsolidated joint ventures | 133 | 133 | |||||||||||||||
Equity in earnings of subsidiaries | (15,225 | ) | 15,225 | — | |||||||||||||
Decrease in trade receivables | 30,264 | 647 | 30,911 | ||||||||||||||
Decrease (increase) in inventories | (11,139 | ) | 1,385 | (9,754 | ) | ||||||||||||
Decrease in accounts payable and accrued liabilities | (21,882 | ) | (331 | ) | (1,385 | ) | (23,598 | ) | |||||||||
Other changes in operating assets and liabilities, net | (15,224 | ) | 1,320 | 8,374 | (5,530 | ) | |||||||||||
Net cash provided by (used in) operating activities | 20,049 | 4,738 | (18,042 | ) | — | 6,745 | |||||||||||
Cash flows from investing activities: | |||||||||||||||||
Payments for acquisitions | (3,100 | ) | (57,519 | ) | (60,619 | ) | |||||||||||
Payments for investments in unconsolidated joint ventures | (1,000 | ) | (1,000 | ) | |||||||||||||
Purchase of property, plant and equipment | (13,505 | ) | (678 | ) | (1,761 | ) | (15,944 | ) | |||||||||
Proceeds from disposition of property, plant and equipment | 358 | 358 | |||||||||||||||
Proceeds from sale of discontinued operations | 4,666 | 4,666 | |||||||||||||||
Net decrease in long-term receivables and deposits | 5,527 | 298 | 5,825 | ||||||||||||||
Net change in other assets | (192 | ) | 216 | 24 | |||||||||||||
Net cash used in investing activities | (6,246 | ) | (1,678 | ) | (58,766 | ) | — | (66,690 | ) | ||||||||
Cash flows from financing activities: | |||||||||||||||||
Net proceeds from issuance of long-term debt | 146,200 | 146,200 | |||||||||||||||
Payments on long-term debt | (7,792 | ) | (7,792 | ) | |||||||||||||
Employee stock purchases | 344 | 110 | 454 | ||||||||||||||
Net cash provided by financing activities | 344 | — | 138,518 | — | 138,862 | ||||||||||||
Net increase in cash and cash equivalents | 14,147 | 3,060 | 61,710 | — | 78,917 | ||||||||||||
Cash and cash equivalents, beginning of period | 70,713 | 34 | 4,569 | 75,316 | |||||||||||||
Cash and cash equivalents, end of period | $ | 84,860 | $ | 3,094 | $ | 66,279 | $ | — | $ | 154,233 | |||||||
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS | |||||||||||||||||
Six Months Ended March 31, 2015 | |||||||||||||||||
Non- | |||||||||||||||||
Guarantor | guarantor | Parent | Headwaters | ||||||||||||||
(in thousands) | Subsidiaries | Subsidiaries | Company | Eliminations | Consolidated | ||||||||||||
Cash flows from operating activities: | |||||||||||||||||
Net income (loss) | $ | 32,325 | $ | 2,304 | $ | (18,618 | ) | $ | (34,125 | ) | $ | (18,114 | ) | ||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||||
Depreciation and amortization | 24,223 | 1,421 | 212 | 25,856 | |||||||||||||
Interest expense related to amortization of debt issue costs and debt discount | 5,042 | 5,042 | |||||||||||||||
Stock-based compensation | 496 | 843 | 1,339 | ||||||||||||||
Deferred income taxes | 295 | 182 | 477 | ||||||||||||||
Net loss on disposition of property, plant and equipment | 112 | 1 | 113 | ||||||||||||||
Loss on sale of discontinued operations, net of income taxes | 45 | 196 | 241 | ||||||||||||||
Net loss of unconsolidated joint ventures | 234 | 234 | |||||||||||||||
Equity in earnings of subsidiaries | (34,125 | ) | 34,125 | 0 | |||||||||||||
Decrease (increase) in trade receivables | 28,597 | (250 | ) | 28,347 | |||||||||||||
Increase in inventories | (10,071 | ) | (557 | ) | (10,628 | ) | |||||||||||
Increase (decrease) in accounts payable and accrued liabilities | (23,170 | ) | 2,248 | (26,658 | ) | (47,580 | ) | ||||||||||
Other changes in operating assets and liabilities, net | 2,554 | (7,521 | ) | (3,802 | ) | (8,769 | ) | ||||||||||
Net cash provided by (used in) operating activities | 55,406 | (1,742 | ) | (77,106 | ) | — | (23,442 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||||||
Business acquisition | (1,200 | ) | (1,200 | ) | |||||||||||||
Investments in unconsolidated joint venture | (125 | ) | (125 | ) | |||||||||||||
Purchase of property, plant and equipment | (14,496 | ) | (259 | ) | (2,719 | ) | (17,474 | ) | |||||||||
Proceeds from disposition of property, plant and equipment | 640 | 640 | |||||||||||||||
Net decrease in long-term receivables and deposits | 2,584 | 1,066 | 3,650 | ||||||||||||||
Net change in other assets | (437 | ) | 93 | (344 | ) | ||||||||||||
Net cash used in investing activities | (13,034 | ) | (259 | ) | (1,560 | ) | — | (14,853 | ) | ||||||||
Cash flows from financing activities: | |||||||||||||||||
Net proceeds from issuance of long-term debt | 414,675 | 414,675 | |||||||||||||||
Payments on long-term debt | (448,736 | ) | (448,736 | ) | |||||||||||||
Dividends paid to non-controlling interest in consolidated subsidiary | (927 | ) | (927 | ) | |||||||||||||
Employee stock purchases | 342 | 16 | 106 | 464 | |||||||||||||
Intercompany transfers | (39,633 | ) | 123 | 39,510 | 0 | ||||||||||||
Net cash provided by (used in) financing activities | (39,291 | ) | (788 | ) | 5,555 | — | (34,524 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents | 3,081 | (2,789 | ) | (73,111 | ) | — | (72,819 | ) | |||||||||
Cash and cash equivalents, beginning of period | 33,552 | 5,764 | 113,226 | 152,542 | |||||||||||||
Cash and cash equivalents, end of period | $ | 36,633 | $ | 2,975 | $ | 40,115 | $ | — | $ | 79,723 | |||||||
Nature_of_Operations_and_Basis1
Nature of Operations and Basis of Presentation (Details) (USD $) | 6 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2014 |
item | |||
Nature of Operations and Basis of Presentation | |||
Number of building materials segments | 2 | ||
Percentage of total revenue and cost of revenue for services | 10.00% | 13.00% | |
Reclassification of debt issue costs to offset related debt liabilities | $10.60 | $7.10 |
Segment_Reporting_Details
Segment Reporting (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2014 |
segment | |||||
Segment Reporting | |||||
Number of business segments | 3 | ||||
Segment revenue | $179,725 | $156,512 | $379,322 | $322,127 | |
Depreciation and amortization | -12,946 | -13,413 | -25,856 | -26,460 | |
Operating income (loss) | 8,230 | 549 | 27,402 | 8,109 | |
Net interest expense | -35,965 | -12,234 | -47,917 | -22,290 | |
Other income (expense), net | -33 | -32 | -302 | -20 | |
Income tax benefit | 2,780 | 2,210 | 2,980 | 2,560 | |
Loss from continuing operations | -24,988 | -9,507 | -17,837 | -11,641 | |
Income (loss) from discontinued operations, net of income taxes | -210 | -575 | -277 | 125 | |
Net loss | -25,198 | -10,082 | -18,114 | -11,516 | |
Capital expenditures | 8,703 | 9,056 | 17,474 | 15,944 | |
Segment assets | 803,236 | 896,306 | 803,236 | 896,306 | 896,306 |
Building Products | |||||
Segment Reporting | |||||
Segment revenue | 106,406 | 94,139 | 223,940 | 187,151 | |
Construction Materials | |||||
Segment Reporting | |||||
Segment revenue | 67,498 | 59,093 | 148,902 | 130,614 | |
Energy Technology | |||||
Segment Reporting | |||||
Segment revenue | 5,821 | 3,280 | 6,480 | 4,362 | |
Operating Segments | Building Products | |||||
Segment Reporting | |||||
Segment revenue | 106,406 | 94,139 | 223,940 | 187,151 | |
Depreciation and amortization | -8,702 | -9,546 | -17,415 | -18,758 | |
Operating income (loss) | 4,679 | 1,907 | 16,627 | 6,993 | |
Capital expenditures | 6,131 | 6,864 | 12,152 | 11,316 | |
Segment assets | 396,568 | 411,968 | 396,568 | 411,968 | |
Operating Segments | Construction Materials | |||||
Segment Reporting | |||||
Segment revenue | 67,498 | 59,093 | 148,902 | 130,614 | |
Depreciation and amortization | -3,799 | -3,319 | -7,535 | -6,605 | |
Operating income (loss) | 8,175 | 5,228 | 21,663 | 15,161 | |
Capital expenditures | 1,026 | 1,377 | 2,374 | 2,562 | |
Segment assets | 308,750 | 325,140 | 308,750 | 325,140 | |
Operating Segments | Energy Technology | |||||
Segment Reporting | |||||
Segment revenue | 5,821 | 3,280 | 6,480 | 4,362 | |
Depreciation and amortization | -341 | -479 | -694 | -967 | |
Operating income (loss) | 1,473 | -821 | -138 | -3,107 | |
Capital expenditures | 61 | 75 | 229 | 305 | |
Segment assets | 27,131 | 22,674 | 27,131 | 22,674 | |
Corporate, Non-Segment | |||||
Segment Reporting | |||||
Segment revenue | 0 | 0 | 0 | 0 | |
Depreciation and amortization | -104 | -69 | -212 | -130 | |
Operating income (loss) | -6,097 | -5,765 | -10,750 | -10,938 | |
Capital expenditures | 1,485 | 740 | 2,719 | 1,761 | |
Segment assets | $70,787 | $136,524 | $70,787 | $136,524 |
Acquisitions_Details
Acquisitions (Details) (USD $) | 3 Months Ended | 6 Months Ended | 0 Months Ended | 3 Months Ended | |||||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 12, 2013 | 16-May-14 | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 | |
item | item | ||||||||
Acquisitions | |||||||||
Number of product categories in niche roofing | 3 | 3 | |||||||
Estimated fair values of assets acquired and liabilities assumed | |||||||||
Goodwill | $175,512,000 | $175,512,000 | $175,586,000 | ||||||
Non-controlling interest in consolidated subsidiary | |||||||||
Balance | 13,252,000 | 13,252,000 | |||||||
Net income attributable to non-controlling interest | 259,000 | 236,000 | 504,000 | 230,000 | |||||
Balance | 12,829,000 | 12,829,000 | |||||||
Entegra | |||||||||
Acquisitions | |||||||||
Total cash consideration of acquisition | 57,500,000 | ||||||||
Fees for advisory, legal and other professional services | 400,000 | ||||||||
Estimated fair values of assets acquired and liabilities assumed | |||||||||
Current assets | 8,261,000 | ||||||||
Current liabilities | -3,422,000 | ||||||||
Property, plant and equipment | 10,589,000 | ||||||||
Goodwill | 28,156,000 | ||||||||
Net assets acquired | 70,784,000 | ||||||||
Less redeemable non-controlling interest | -13,252,000 | ||||||||
Net assets attributable to Headwaters | 57,532,000 | ||||||||
Intangible assets acquired: | |||||||||
Noncontrolling equity interest (as a percent) | 20.00% | ||||||||
Minimum period following the acquisition date after which remaining noncontrolling equity interest may be acquired | 5 years | ||||||||
Minimum period following the acquisition date after which the noncontrolling owners may require remaining noncontrolling equity interests to be acquired | 18 months | ||||||||
Period over which goodwill is expected to be deductible for tax purpose | 15 years | ||||||||
Non-controlling interest in consolidated subsidiary | |||||||||
Balance | 13,252,000 | 13,252,000 | |||||||
Net income attributable to non-controlling interest | 504,000 | ||||||||
Dividends paid to non-controlling interest | -927,000 | ||||||||
Balance | 12,829,000 | 12,829,000 | |||||||
Entegra | Trade Names | |||||||||
Intangible assets acquired: | |||||||||
Indefinite lived intangible assets | 6,600,000 | ||||||||
Entegra | Customer Relationships | |||||||||
Intangible assets acquired: | |||||||||
Finite lived intangible assets | 20,600,000 | ||||||||
Estimated useful lives | 15 years | ||||||||
Roof Tile Acquisition LLC | |||||||||
Intangible assets acquired: | |||||||||
Percentage of equity interests acquired | 80.00% | ||||||||
Gerard | |||||||||
Acquisitions | |||||||||
Total cash consideration of acquisition | 27,600,000 | ||||||||
Fees for advisory, legal and other professional services | 300,000 | ||||||||
Estimated fair values of assets acquired and liabilities assumed | |||||||||
Current assets | 9,236,000 | ||||||||
Current liabilities | -1,691,000 | ||||||||
Property, plant and equipment | 8,314,000 | ||||||||
Goodwill | 7,719,000 | ||||||||
Long-term liabilities | -3,906,000 | ||||||||
Net assets acquired | 27,572,000 | ||||||||
Intangible assets acquired: | |||||||||
Period over which goodwill is expected to be deductible for tax purpose | 15 years | ||||||||
Gerard | Trade Names | |||||||||
Intangible assets acquired: | |||||||||
Indefinite lived intangible assets | 3,900,000 | ||||||||
Gerard | Customer Relationships | |||||||||
Intangible assets acquired: | |||||||||
Finite lived intangible assets | 4,000,000 | ||||||||
Estimated useful lives | 15 years | ||||||||
Other Business Acquisitions | |||||||||
Acquisitions | |||||||||
Total cash consideration of acquisition | 1,200,000 | ||||||||
Intangible assets acquired: | |||||||||
Percentage of equity interests acquired | 100.00% | ||||||||
Construction Materials | Other Business Acquisitions | |||||||||
Acquisitions | |||||||||
Total cash consideration of acquisition | $3,100,000 | $7,400,000 |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Jan. 31, 2013 | |
item | |||||
Discontinued operations | |||||
Income (loss) from discontinued operations, net of income taxes | ($210,000) | ($575,000) | ($277,000) | $125,000 | |
Coal Cleaning Business | |||||
Discontinued operations | |||||
Remaining assets held for sale | 0 | ||||
Revenue | 0 | 0 | 0 | 0 | |
Loss from operations of discontinued operations before income taxes | -14,000 | -2,728,000 | -36,000 | -2,992,000 | |
Gain (loss) on disposal | -196,000 | 2,153,000 | -241,000 | 3,117,000 | |
Income tax provision | 0 | 0 | 0 | 0 | |
Income (loss) from discontinued operations, net of income taxes | -210,000 | -575,000 | -277,000 | 125,000 | |
Number of sales transactions in which the buyer agreed to assume the lease and certain reclamation obligations | 1 | ||||
Number of reclamation obligations | 1 | ||||
Accrued liability for reclamation obligations | $8,000,000 | $8,000,000 |
Inventories_Details
Inventories (Details) (USD $) | Mar. 31, 2015 | Sep. 30, 2014 |
In Thousands, unless otherwise specified | ||
Inventories | ||
Raw materials | $13,645 | $12,017 |
Finished goods | 49,920 | 38,616 |
Inventories | $63,565 | $50,633 |
Intangible_Assets_Details
Intangible Assets (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2014 | |
Gross carrying amount and accumulated amortization of intangible assets | |||||
Total Gross Carrying Amount | $323,229,000 | $323,229,000 | $321,234,000 | ||
Accumulated Amortization | 170,417,000 | 170,417,000 | 161,371,000 | ||
Amortization expense related to intangible assets | 4,600,000 | 5,500,000 | 9,000,000 | 10,600,000 | |
CCP Contracts | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | 112,300,000 | 112,300,000 | 112,300,000 | ||
Accumulated Amortization | 67,033,000 | 67,033,000 | 64,192,000 | ||
CCP Contracts | Minimum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 15 years | ||||
CCP Contracts | Maximum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 20 years | ||||
Customer Relationships | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | 109,299,000 | 109,299,000 | 107,953,000 | ||
Accumulated Amortization | 54,188,000 | 54,188,000 | 50,355,000 | ||
Customer Relationships | Minimum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 5 years | ||||
Customer Relationships | Maximum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 17 years | ||||
Trade Names | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | 67,220,000 | 67,220,000 | 67,220,000 | ||
Accumulated Amortization | 35,104,000 | 35,104,000 | 33,394,000 | ||
Trade Names | Minimum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 5 years | ||||
Trade Names | Maximum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 20 years | ||||
Patents and Patented Technologies | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | 14,526,000 | 14,526,000 | 14,526,000 | ||
Accumulated Amortization | 12,130,000 | 12,130,000 | 11,686,000 | ||
Patents and Patented Technologies | Minimum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 5 years | ||||
Patents and Patented Technologies | Maximum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 19 years | ||||
Other Intangible Assets | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | 4,584,000 | 4,584,000 | 3,935,000 | ||
Accumulated Amortization | 1,962,000 | 1,962,000 | 1,744,000 | ||
Other Intangible Assets | Minimum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 5 years | ||||
Other Intangible Assets | Maximum | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Estimated useful lives | 17 years | ||||
Trade Names | |||||
Gross carrying amount and accumulated amortization of intangible assets | |||||
Gross Carrying Amount | $15,300,000 | $15,300,000 | $15,300,000 |
Intangible_Assets_Details_2
Intangible Assets (Details 2) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Total currently estimated annual amortization expense | |
2015 | $18,166 |
2016 | 17,957 |
2017 | 17,079 |
2018 | 17,030 |
2019 | 16,001 |
2020 | $11,762 |
Longterm_Debt_Details
Long-term Debt (Details) (USD $) | Mar. 31, 2015 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2011 |
Long-term debt | ||||
Debt instrument, face amount | $575,000,000 | $599,800,000 | ||
Carrying amount of long-term debt, net of discounts and debt issue costs | 562,317,000 | 592,458,000 | ||
Less current portion | -3,188,000 | 0 | ||
Long-term debt | 559,129,000 | 592,458,000 | ||
Senior secured term loan, due March 2022 | ||||
Long-term debt | ||||
Debt instrument, face amount | 425,000,000 | |||
Carrying amount of long-term debt, net of discounts and debt issue costs | 414,801,000 | 0 | ||
7.25% Senior notes, due January 2019 | ||||
Long-term debt | ||||
Debt instrument, face amount | 150,000,000 | 150,000,000 | 150,000,000 | |
Carrying amount of long-term debt, net of discounts and debt issue costs | 147,516,000 | 147,192,000 | ||
Interest rate on long-term debt (as a percent) | 7.25% | 7.25% | 7.25% | |
Senior Secured Notes 7.625 Percent | ||||
Long-term debt | ||||
Debt instrument, face amount | 400,000,000 | 400,000,000 | ||
Carrying amount of long-term debt, net of discounts and debt issue costs | 0 | 396,058,000 | ||
Interest rate on long-term debt (as a percent) | 7.63% | 7.63% | 7.63% | |
Convertible Senior Subordinated Notes 8.75 Percent Due 2016 | ||||
Long-term debt | ||||
Debt instrument, face amount | 49,791,000 | |||
Carrying amount of long-term debt, net of discounts and debt issue costs | $0 | $49,208,000 | ||
Interest rate on long-term debt (as a percent) | 8.75% | 8.75% |
Longterm_Debt_Details_2
Long-term Debt (Details 2) (USD $) | 6 Months Ended | 1 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Dec. 31, 2013 | Sep. 30, 2014 | |
Long-term debt | |||||
Net proceeds from initial borrowing | $414,675,000 | $146,200,000 | |||
Debt instrument, face amount | 575,000,000 | 575,000,000 | 599,800,000 | ||
Senior secured term loan, due March 2022 | |||||
Long-term debt | |||||
Percentage of original principal amount on which the aggregate amount of annual scheduled repayments is determined | 1.00% | 1.00% | |||
Maximum outstanding balance of senior notes at a specified period that may trigger early maturity of term loan | 50,000,000 | 50,000,000 | |||
Initial interest rate | 4.50% | 4.50% | |||
Debt prepayment premium percentage | 1.00% | ||||
Maximum percentage of annual excess cash flow required to be used for prepayment | 50.00% | ||||
Annual excess cash flow threshold for required prepayment | 1,000,000 | ||||
Percentage of net cash proceeds of non-ordinary course asset sales required to be used for prepayment | 100.00% | ||||
Percentage of net cash proceeds of certain issuances of debt required to be used for prepayment | 100.00% | ||||
Net proceeds from initial borrowing | 414,700,000 | ||||
Original issue discount | 2,100,000 | 2,100,000 | |||
Transaction costs | 8,200,000 | ||||
Debt instrument, face amount | 425,000,000 | 425,000,000 | |||
Senior secured term loan, due March 2022 | Prime Rate | |||||
Long-term debt | |||||
Variable interest rate base | Prime rate | ||||
Minimum floor variable percentage under terms of the debt agreement | 2.00% | ||||
Secondary variable rate margin (as a percent) | 2.50% | ||||
Senior secured term loan, due March 2022 | Federal funds rate | |||||
Long-term debt | |||||
Interest rate margin (as a percent) | 0.50% | ||||
Variable interest rate base | Federal funds rate | ||||
Minimum floor variable percentage under terms of the debt agreement | 2.00% | ||||
Secondary variable rate margin (as a percent) | 2.50% | ||||
Senior secured term loan, due March 2022 | Eurocurrency rate (LIBO) | |||||
Long-term debt | |||||
Variable interest rate base | LIBO | ||||
Minimum floor variable percentage under terms of the debt agreement | 1.00% | ||||
Secondary variable rate margin (as a percent) | 3.50% | ||||
Senior secured term loan, due March 2022 | Thirty Day LIBO | |||||
Long-term debt | |||||
Interest rate margin (as a percent) | 1.00% | ||||
Variable interest rate base | 30-day LIBO | ||||
Minimum floor variable percentage under terms of the debt agreement | 2.00% | ||||
Secondary variable rate margin (as a percent) | 3.50% | ||||
Incremental term loans | |||||
Long-term debt | |||||
Maximum borrowing capacity | 150,000,000 | 150,000,000 | |||
7.25% Senior notes, due January 2019 | |||||
Long-term debt | |||||
Net proceeds from senior secured notes | 146,700,000 | ||||
Debt instrument, face amount | $150,000,000 | $150,000,000 | $150,000,000 | $150,000,000 | |
Interest rate on secured notes (as a percent) | 7.25% | 7.25% | 7.25% | 7.25% | |
Purchase price of debt instrument, if there is a change in control (as a percent) | 101.00% | ||||
7.25% Senior notes, due January 2019 | Debt Instrument Redemption Period Commencing after January 15, 2016 | Maximum | |||||
Long-term debt | |||||
Debt instrument redemption price (as a percent) | 103.63% | ||||
7.25% Senior notes, due January 2019 | Debt Instrument Redemption Period Commencing after January 15, 2016 | Minimum | |||||
Long-term debt | |||||
Debt instrument redemption price (as a percent) | 100.00% | ||||
7.25% Senior notes, due January 2019 | Debt Instrument Redemption Period on or Prior to January 15, 2016 | |||||
Long-term debt | |||||
Redemption price of debt instrument if redeemed with proceeds from qualified equity offerings (as a percent) | 107.25% | ||||
Debt instrument redemption price in addition to a make-whole premium (as a percent) | 100.00% | ||||
7.25% Senior notes, due January 2019 | Debt Instrument Redemption Period on or Prior to January 15, 2016 | Maximum | |||||
Long-term debt | |||||
Percentage of the principal amount of the debt instrument which the entity may redeem with proceeds from qualified equity offerings | 35.00% |
Longterm_Debt_Details_3
Long-term Debt (Details 3) (USD $) | 6 Months Ended | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2015 |
ABL Revolver | ||
Long-term debt | ||
Revolving credit arrangement amount outstanding | $0 | $0 |
Maximum borrowing capacity | 70 | 70 |
Current borrowing capacity | 60.6 | 60.6 |
Termination date based on the earliest maturity date of the specified long-term debt | 3 months | |
Line of credit facility, interest rate at period end (as a percent) | 1.80% | 1.80% |
ABL Revolver | Minimum | ||
Long-term debt | ||
Line of credit facility unused capacity commitment fee percentage | 0.25% | |
Specified percentage of availability below which a monthly fixed charge coverage ratio applies | 12.50% | |
Coverage ratio | 1 | |
ABL Revolver | Maximum | ||
Long-term debt | ||
Line of credit facility unused capacity commitment fee percentage | 0.38% | |
ABL Revolver | London Interbank Offered Rate (LIBOR) | ||
Long-term debt | ||
Variable interest rate base | LIBOR | |
Percentage points added to the reference rate, one | 1.50% | 1.50% |
Percentage points added to the reference rate, two | 1.75% | 1.75% |
Percentage points added to the reference rate, three | 2.00% | 2.00% |
ABL Revolver | Thirty Day LIBOR | ||
Long-term debt | ||
Variable interest rate base | 30-day LIBOR | |
Interest rate margin (as a percent) | 1.00% | |
ABL Revolver | Base Rate | ||
Long-term debt | ||
Variable interest rate base | Base rate | |
Percentage points added to the reference rate, one | 0.25% | 0.25% |
Percentage points added to the reference rate, two | 0.50% | 0.50% |
Percentage points added to the reference rate, three | 0.75% | 0.75% |
ABL Revolver | Prime Rate | ||
Long-term debt | ||
Variable interest rate base | Prime rate | |
ABL Revolver | Federal funds rate | ||
Long-term debt | ||
Variable interest rate base | Federal funds rate | |
Interest rate margin (as a percent) | 0.50% | |
Letter of Credit | ||
Long-term debt | ||
Maximum borrowing capacity | 35 | 35 |
Outstanding standby letters of credit | 7.4 | |
Swingline Facility | ||
Long-term debt | ||
Maximum borrowing capacity | $10.50 | $10.50 |
Longterm_Debt_Details_4
Long-term Debt (Details 4) (USD $) | 6 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Sep. 30, 2011 | Sep. 30, 2014 | |
Long-term debt | |||
Debt instrument, face amount | $575,000,000 | $599,800,000 | |
Senior Secured Notes 7.625 Percent | |||
Long-term debt | |||
Interest rate on long-term debt (as a percent) | 7.63% | 7.63% | 7.63% |
Debt instrument, face amount | 400,000,000 | 400,000,000 | |
Net proceeds from senior secured notes | 392,800,000 | ||
Loss on extinguishment of debt | 21,300,000 | ||
Early repayment premium amount | 15,300,000 | ||
Early repayment of interest amount | 2,500,000 | ||
Premiums and accelerated amortization of unamortized debt issue costs charged to interest expense | 3,500,000 | ||
Convertible Senior Subordinated Notes 8.75 Percent Due 2016 | |||
Long-term debt | |||
Interest rate on long-term debt (as a percent) | 8.75% | 8.75% | |
Debt instrument, face amount | 49,791,000 | ||
Premiums and accelerated amortization of unamortized debt issue costs charged to interest expense | $3,500,000 |
Longterm_Debt_Details_5
Long-term Debt (Details 5) (USD $) | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2011 | |
Long-term debt | ||||||
Interest expense | $36,100,000 | $12,400,000 | $48,300,000 | $22,600,000 | ||
Non-cash interest expense | 4,500,000 | 600,000 | 5,042,000 | 1,153,000 | ||
Weighted average interest rate (as a percent) | 5.20% | 5.20% | 7.60% | |||
Senior Secured Notes 7.625 Percent and Convertible Senior Subordinated Notes 8.75 Percent | ||||||
Long-term debt | ||||||
Interest expense | 24,800,000 | |||||
Senior Secured Notes 7.625 Percent | ||||||
Long-term debt | ||||||
Interest rate on secured notes (as a percent) | 7.63% | 7.63% | 7.63% | 7.63% | ||
Convertible Senior Subordinated Notes 8.75 Percent Due 2016 | ||||||
Long-term debt | ||||||
Interest rate on secured notes (as a percent) | 8.75% | 8.75% | 8.75% | |||
Senior secured term loan, due March 2022 | ||||||
Long-term debt | ||||||
Required quarterly repayments due | $1,100,000 |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Details) (USD $) | Mar. 31, 2015 | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt, fair value | 626 | ||
Long-term debt, carrying value | 592.5 | ||
7.25% Senior notes, due January 2019 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt, fair value | 158 | ||
Long-term debt, carrying value | $147.50 | ||
Debt Instrument, Interest Rate, Stated Percentage | 7.25% | 7.25% | 7.25% |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 6 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2014 |
Income tax | |||
Estimated effective income tax rate (as a percent) | 10.00% | 18.00% | 18.00% |
Income tax expense for discrete items in continuing operations | $0.90 | ||
Cumulative loss period | 3 years | ||
Net operating and capital loss carryforwards | 77.8 | ||
Tax credit carryforwards | 24.8 | ||
Unrecognized income tax benefits that may be released within next 12 months | $5 | ||
Minimum | |||
Income tax | |||
Carryover period for deferred tax attributes | 20 years | ||
Operating loss carryforwards expiration date | 30-Sep-15 | ||
Tax credit carryforwards, expiration date | 30-Sep-28 | ||
Maximum | |||
Income tax | |||
Operating loss carryforwards expiration date | 30-Sep-34 | ||
Tax credit carryforwards, expiration date | 30-Sep-34 |
Equity_Securities_and_StockBas1
Equity Securities and Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | ||
Share data in Millions, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Treasury stock and related deferred compensation obligation at fair value | $1,300,000 | $1,300,000 | |||
Amount that the fair values of treasury stock and related deferred compensation obligation exceed the carrying values at cost | 600,000 | 600,000 | |||
Stock-based compensation | 700,000 | 500,000 | 1,339,000 | 1,016,000 | |
Total compensation cost related to unvested awards not yet recognized | $3,700,000 | $3,700,000 | |||
2010 Incentive Compensation Plan | |||||
Board approved share-based award grants to officers, employees, and directors (in shares) | 0.3 | ||||
Awards granted vesting period | 3 years | ||||
Period of average stock price hurdles that precluded vesting | 60 days |
Earnings_per_Share_Details
Earnings per Share (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Numerator: | ||||
Loss from continuing operations | ($24,988) | ($9,507) | ($17,837) | ($11,641) |
Net income attributable to non-controlling interest | -259 | -236 | -504 | -230 |
Adjustment of estimated redemption value of non-controlling interest | 276 | 0 | 0 | 0 |
Numerator for basic and diluted earnings per share from continuing operations - loss from continuing operations attributable to Headwaters Incorporated | -24,971 | -9,743 | -18,341 | -11,871 |
Numerator for basic and diluted earnings per share from discontinued operations - income (loss) from discontinued operations, net of income taxes | -210 | -575 | -277 | 125 |
Numerator for basic and diluted earnings per share - net loss attributable to Headwaters Incorporated | ($25,181) | ($10,318) | ($18,618) | ($11,746) |
Denominator: | ||||
Denominator for basic earnings per share - weighted-average shares outstanding | 73,555 | 73,121 | 73,501 | 73,094 |
Basic and diluted income (loss) per share from continuing operations (in dollars per share) | ($0.34) | ($0.13) | ($0.25) | ($0.16) |
Basic and diluted income (loss) per share from discontinued operations (in dollars per share) | $0 | ($0.01) | $0 | $0 |
Earnings (loss) per share, basic and diluted, total (in dollars per share) | ($0.34) | ($0.14) | ($0.25) | ($0.16) |
Earnings_per_Share_Details_2
Earnings per Share (Details 2) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Stock Appreciation Rights (SARs) | ||||
Earnings per Share | ||||
Anti-dilutive securities not considered in diluted EPS calculation (in shares) | 3,811 | 3,821 | 2,358 | 3,879 |
Stock options | ||||
Earnings per Share | ||||
Anti-dilutive securities not considered in diluted EPS calculation (in shares) | 105 | 594 | 105 | 606 |
Restricted stock | ||||
Earnings per Share | ||||
Anti-dilutive securities not considered in diluted EPS calculation (in shares) | 264 | 253 | 132 | 253 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 6 Months Ended | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Sep. 30, 2011 | Sep. 30, 2012 |
Stock Appreciation Rights (SARs) | ||||
Commitments and Contingencies | ||||
Compensation expense | $2.70 | $4.20 | ||
Stock Appreciation Rights (SARs), 2011 Awards | ||||
Commitments and Contingencies | ||||
Grants approved by committee to employees for cash settled stock appreciation rights (in shares) | 0.4 | |||
Grants approved by committee to employees for cash settled stock appreciation rights that remain outstanding (in shares) | 0.1 | |||
Ending period for expected liability adjustment | SeptemberB 30, 2015 | |||
Amount accrued for awards | 0.9 | |||
Grant-date stock price (in dollars per share) | $3.81 | |||
Stock Appreciation Rights (SARS), 2012 Awards | ||||
Commitments and Contingencies | ||||
Grants approved by committee to employees for cash settled stock appreciation rights (in shares) | 1 | |||
Grants approved by committee to employees for cash settled stock appreciation rights that remain outstanding (in shares) | 0.3 | |||
Ending period for expected liability adjustment | SeptemberB 30, 2016 | |||
Amount accrued for awards | $5.80 | |||
Grant-date stock price (in dollars per share) | $1.85 | |||
Average stock price period | 60 days | |||
Minimum | Stock Appreciation Rights (SARS), 2012 Awards | ||||
Commitments and Contingencies | ||||
Percentage of stock price on grant date | 135.00% | |||
Threshold stock price at which SARS will vest (in dollars per share) | $2.50 |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details 2) (USD $) | 6 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | Feb. 29, 2012 | Sep. 30, 2010 | Dec. 31, 2012 | |
item | item | ||||
Commitments and Contingencies | |||||
Long term capital commitments on property, plant and equipment | $1,700,000 | ||||
Legal Matters | |||||
Commitments and Contingencies | |||||
Legal fees | 1,700,000 | 3,900,000 | |||
Total liability accrued | 2,500,000 | ||||
Legal Matters | Minimum | |||||
Commitments and Contingencies | |||||
Potential loss for unresolved matters | 2,500,000 | ||||
Fentress Families Trust | |||||
Commitments and Contingencies | |||||
Number of plaintiffs | 383 | ||||
Number of defendants | 15 | ||||
Damages for removal and remediation of fly ash and water supply | 850,000,000 | ||||
Damages for vexation | 1,900,000,000 | ||||
Damages for others | 8,000,000 | ||||
Damages for properties plus prejudgment interest, attorney fees and costs | 55,000,000 | ||||
Additional damages sought by other plaintiffs | 307,200,000 | ||||
Number of insurers who have denied coverage | 2 | ||||
CPM Virginia LLC | |||||
Commitments and Contingencies | |||||
Loss contingency damages sought value | $500,000 | ||||
Loss contingency potential damages sought | CPM alleged multiple causes of action and claimed hundreds of millions of dollars in damages, including site remediation costs, punitive damages, and attorney fees. |
Condensed_Consolidating_Financ2
Condensed Consolidating Financial Information (Details) | 6 Months Ended | ||
Mar. 31, 2015 | Sep. 30, 2014 | Dec. 31, 2013 | |
Long-term debt | |||
Ownership percentage in guarantor subsidiaries | 100.00% | ||
Maximum percentage of ownership interest below which subsidiaries are considered non-guaranteeing | 100.00% | ||
7.25% Senior notes, due January 2019 | |||
Long-term debt | |||
Interest rate on long-term debt (as a percent) | 7.25% | 7.25% | 7.25% |
Condensed_Consolidating_Financ3
Condensed Consolidating Financial Information (Details 2) (USD $) | Mar. 31, 2015 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | ||||
Current assets: | ||||
Cash and cash equivalents | $79,723 | $152,542 | $154,233 | $75,316 |
Trade receivables, net | 91,366 | 119,330 | ||
Inventories | 63,565 | 50,633 | ||
Current and deferred income taxes | 11,218 | 11,076 | ||
Other | 12,146 | 10,536 | ||
Total current assets | 258,018 | 344,117 | ||
Property, plant and equipment, net | 182,249 | 182,111 | ||
Other assets: | ||||
Goodwill | 175,512 | 175,586 | ||
Intangible assets, net | 152,812 | 159,863 | ||
Other | 34,645 | 34,629 | ||
Total other assets | 362,969 | 370,078 | ||
Total assets | 803,236 | 896,306 | 896,306 | |
Current liabilities: | ||||
Accounts payable | 19,820 | 27,026 | ||
Accrued personnel costs | 32,575 | 48,902 | ||
Accrued interest | 2,721 | 18,273 | ||
Current income taxes | 0 | 368 | ||
Other accrued liabilities | 37,049 | 41,757 | ||
Current portion of long-term debt | 3,188 | 0 | ||
Total current liabilities | 95,353 | 136,326 | ||
Long-term liabilities: | ||||
Long-term debt, net | 559,129 | 592,458 | ||
Income taxes | 18,939 | 23,242 | ||
Other | 31,359 | 28,586 | ||
Total long-term liabilities | 609,427 | 644,286 | ||
Total liabilities | 704,780 | 780,612 | ||
Redeemable non-controlling interest in consolidated subsidiary | 12,829 | 13,252 | ||
Stockholders' equity: | ||||
Common stock | 74 | 74 | ||
Capital in excess of par value | 725,615 | 723,648 | ||
Retained earnings (accumulated deficit) | -639,306 | -620,688 | ||
Treasury stock | -756 | -592 | ||
Total stockholders' equity | 85,627 | 102,442 | ||
Total liabilities and stockholders' equity | 803,236 | 896,306 | ||
Consolidation, Eliminations | ||||
Current assets: | ||||
Current and deferred income taxes | -68,756 | -23,149 | ||
Total current assets | -68,756 | -23,149 | ||
Other assets: | ||||
Investments in subsidiaries | -521,141 | -406,327 | ||
Intercompany accounts and notes | -637,046 | -637,046 | ||
Deferred income taxes | -73,777 | -64,586 | ||
Total other assets | -1,231,964 | -1,107,959 | ||
Total assets | -1,300,720 | -1,131,108 | ||
Current liabilities: | ||||
Current income taxes | -68,756 | -23,149 | ||
Total current liabilities | -68,756 | -23,149 | ||
Long-term liabilities: | ||||
Income taxes | -73,777 | -64,586 | ||
Intercompany accounts and notes | -693,695 | -637,046 | ||
Total long-term liabilities | -767,472 | -701,632 | ||
Total liabilities | -836,228 | -724,781 | ||
Stockholders' equity: | ||||
Capital in excess of par value | -543,167 | -519,127 | ||
Retained earnings (accumulated deficit) | 78,675 | 112,800 | ||
Total stockholders' equity | -464,492 | -406,327 | ||
Total liabilities and stockholders' equity | -1,300,720 | -1,131,108 | ||
Guarantor Subsidiaries | ||||
Current assets: | ||||
Cash and cash equivalents | 36,633 | 33,552 | 84,860 | 70,713 |
Trade receivables, net | 85,726 | 113,940 | ||
Inventories | 60,857 | 48,482 | ||
Current and deferred income taxes | 7,196 | 15,509 | ||
Other | 10,596 | 9,286 | ||
Total current assets | 201,008 | 220,769 | ||
Property, plant and equipment, net | 162,422 | 162,458 | ||
Other assets: | ||||
Goodwill | 144,643 | 145,068 | ||
Intangible assets, net | 124,836 | 131,150 | ||
Investments in subsidiaries | 46,273 | |||
Deferred income taxes | 50,188 | 41,658 | ||
Other | 10,894 | 14,388 | ||
Total other assets | 376,834 | 332,264 | ||
Total assets | 740,264 | 715,491 | ||
Current liabilities: | ||||
Accounts payable | 17,904 | 25,643 | ||
Accrued personnel costs | 9,551 | 13,483 | ||
Current income taxes | 47,658 | 23,198 | ||
Other accrued liabilities | 27,939 | 36,811 | ||
Total current liabilities | 103,052 | 99,135 | ||
Long-term liabilities: | ||||
Income taxes | 64,117 | 65,133 | ||
Intercompany accounts and notes | 191,274 | |||
Other | 333 | 16,167 | ||
Total long-term liabilities | 64,450 | 272,574 | ||
Total liabilities | 167,502 | 371,709 | ||
Stockholders' equity: | ||||
Capital in excess of par value | 486,069 | 458,498 | ||
Retained earnings (accumulated deficit) | 86,693 | -114,716 | ||
Total stockholders' equity | 572,762 | 343,782 | ||
Total liabilities and stockholders' equity | 740,264 | 715,491 | ||
Non-Guarantor Subsidiaries | ||||
Current assets: | ||||
Cash and cash equivalents | 2,975 | 5,764 | 3,094 | 34 |
Trade receivables, net | 5,640 | 5,390 | ||
Inventories | 2,708 | 2,151 | ||
Current and deferred income taxes | 27,998 | 289 | ||
Other | 163 | 168 | ||
Total current assets | 39,484 | 13,762 | ||
Property, plant and equipment, net | 10,304 | 11,674 | ||
Other assets: | ||||
Goodwill | 30,869 | 30,518 | ||
Intangible assets, net | 27,976 | 28,713 | ||
Other | 2,180 | 1,381 | ||
Total other assets | 61,025 | 60,612 | ||
Total assets | 110,813 | 86,048 | ||
Current liabilities: | ||||
Accounts payable | 908 | 956 | ||
Accrued personnel costs | 598 | 418 | ||
Current income taxes | 5,122 | 319 | ||
Other accrued liabilities | 3,006 | |||
Total current liabilities | 6,628 | 4,699 | ||
Long-term liabilities: | ||||
Income taxes | 7,310 | 893 | ||
Intercompany accounts and notes | 177,035 | 4,061 | ||
Other | 15,457 | 774 | ||
Total long-term liabilities | 199,802 | 5,728 | ||
Total liabilities | 206,430 | 10,427 | ||
Redeemable non-controlling interest in consolidated subsidiary | 12,829 | 13,252 | ||
Stockholders' equity: | ||||
Capital in excess of par value | 56,922 | 60,453 | ||
Retained earnings (accumulated deficit) | -165,368 | 1,916 | ||
Total stockholders' equity | -108,446 | 62,369 | ||
Total liabilities and stockholders' equity | 110,813 | 86,048 | ||
Parent Company | ||||
Current assets: | ||||
Cash and cash equivalents | 40,115 | 113,226 | 66,279 | 4,569 |
Current and deferred income taxes | 44,780 | 18,427 | ||
Other | 1,387 | 1,082 | ||
Total current assets | 86,282 | 132,735 | ||
Property, plant and equipment, net | 9,523 | 7,979 | ||
Other assets: | ||||
Investments in subsidiaries | 474,868 | 406,327 | ||
Intercompany accounts and notes | 637,046 | 637,046 | ||
Deferred income taxes | 23,589 | 22,928 | ||
Other | 21,571 | 18,860 | ||
Total other assets | 1,157,074 | 1,085,161 | ||
Total assets | 1,252,879 | 1,225,875 | ||
Current liabilities: | ||||
Accounts payable | 1,008 | 427 | ||
Accrued personnel costs | 22,426 | 35,001 | ||
Accrued interest | 2,721 | 18,273 | ||
Current income taxes | 21,098 | |||
Other accrued liabilities | 3,988 | 1,940 | ||
Current portion of long-term debt | 3,188 | |||
Total current liabilities | 54,429 | 55,641 | ||
Long-term liabilities: | ||||
Long-term debt, net | 559,129 | 592,458 | ||
Income taxes | 21,289 | 21,802 | ||
Intercompany accounts and notes | 516,660 | 441,711 | ||
Other | 15,569 | 11,645 | ||
Total long-term liabilities | 1,112,647 | 1,067,616 | ||
Total liabilities | 1,167,076 | 1,123,257 | ||
Stockholders' equity: | ||||
Common stock | 74 | 74 | ||
Capital in excess of par value | 725,791 | 723,824 | ||
Retained earnings (accumulated deficit) | -639,306 | -620,688 | ||
Treasury stock | -756 | -592 | ||
Total stockholders' equity | 85,803 | 102,618 | ||
Total liabilities and stockholders' equity | $1,252,879 | $1,225,875 |
Condensed_Consolidating_Financ4
Condensed Consolidating Financial Information (Details 3) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Revenue: | ||||
Total revenue | $179,725 | $156,512 | $379,322 | $322,127 |
Cost of revenue: | ||||
Total cost of revenue | 132,584 | 117,961 | 276,494 | 242,683 |
Gross profit | 47,141 | 38,551 | 102,828 | 79,444 |
Operating expenses: | ||||
Amortization | 4,560 | 5,485 | 9,046 | 10,591 |
Selling, general and administrative | 34,351 | 32,517 | 66,380 | 60,744 |
Total operating expenses | 38,911 | 38,002 | 75,426 | 71,335 |
Operating income | 8,230 | 549 | 27,402 | 8,109 |
Other income (expense): | ||||
Net interest expense | -35,965 | -12,234 | -47,917 | -22,290 |
Other, net | -33 | -32 | -302 | -20 |
Total other income (expense), net | -35,998 | -12,266 | -48,219 | -22,310 |
Loss from continuing operations before income taxes | -27,768 | -11,717 | -20,817 | -14,201 |
Income tax benefit (provision) | 2,780 | 2,210 | 2,980 | 2,560 |
Loss from continuing operations | -24,988 | -9,507 | -17,837 | -11,641 |
Income (loss) from discontinued operations, net of income taxes | -210 | -575 | -277 | 125 |
Net loss | -25,198 | -10,082 | -18,114 | -11,516 |
Net income attributable to non-controlling interest | -259 | -236 | -504 | -230 |
Net loss attributable to Headwaters Incorporated | -25,457 | -10,318 | -18,618 | -11,746 |
Building Products | ||||
Revenue: | ||||
Total revenue | 106,406 | 94,139 | 223,940 | 187,151 |
Cost of revenue: | ||||
Total cost of revenue | 79,481 | 70,828 | 163,673 | 140,166 |
Construction Materials | ||||
Revenue: | ||||
Total revenue | 67,498 | 59,093 | 148,902 | 130,614 |
Cost of revenue: | ||||
Total cost of revenue | 50,738 | 45,669 | 110,249 | 100,434 |
Energy Technology | ||||
Revenue: | ||||
Total revenue | 5,821 | 3,280 | 6,480 | 4,362 |
Cost of revenue: | ||||
Total cost of revenue | 2,365 | 1,464 | 2,572 | 2,083 |
Consolidation, Eliminations | ||||
Other income (expense): | ||||
Equity in earnings of subsidiaries | -12,325 | -3,574 | -34,125 | -15,225 |
Total other income (expense), net | -12,325 | -3,574 | -34,125 | -15,225 |
Loss from continuing operations before income taxes | -12,325 | -3,574 | -34,125 | -15,225 |
Loss from continuing operations | -12,325 | -3,574 | -34,125 | -15,225 |
Net loss | -12,325 | -3,574 | -34,125 | -15,225 |
Net loss attributable to Headwaters Incorporated | -12,325 | -3,574 | -34,125 | -15,225 |
Guarantor Subsidiaries | ||||
Revenue: | ||||
Total revenue | 169,254 | 147,481 | 357,710 | 311,421 |
Cost of revenue: | ||||
Total cost of revenue | 125,519 | 111,591 | 261,755 | 234,844 |
Gross profit | 43,735 | 35,890 | 95,955 | 76,577 |
Operating expenses: | ||||
Amortization | 4,191 | 5,123 | 8,309 | 10,229 |
Selling, general and administrative | 26,636 | 25,610 | 52,438 | 48,411 |
Total operating expenses | 30,827 | 30,733 | 60,747 | 58,640 |
Operating income | 12,908 | 5,157 | 35,208 | 17,937 |
Other income (expense): | ||||
Net interest expense | -60 | -146 | -104 | -167 |
Other, net | -62 | 29 | -142 | 74 |
Total other income (expense), net | -122 | -117 | -246 | -93 |
Loss from continuing operations before income taxes | 12,786 | 5,040 | 34,962 | 17,844 |
Income tax benefit (provision) | -1,300 | -1,571 | -2,570 | -3,350 |
Loss from continuing operations | 11,486 | 3,469 | 32,392 | 14,494 |
Income (loss) from discontinued operations, net of income taxes | -575 | -67 | 125 | |
Net loss | 11,486 | 2,894 | 32,325 | 14,619 |
Net loss attributable to Headwaters Incorporated | 11,486 | 2,894 | 32,325 | 14,619 |
Guarantor Subsidiaries | Building Products | ||||
Revenue: | ||||
Total revenue | 95,935 | 85,108 | 202,328 | 176,445 |
Cost of revenue: | ||||
Total cost of revenue | 72,416 | 64,458 | 148,934 | 132,327 |
Guarantor Subsidiaries | Construction Materials | ||||
Revenue: | ||||
Total revenue | 67,498 | 59,093 | 148,902 | 130,614 |
Cost of revenue: | ||||
Total cost of revenue | 50,738 | 45,669 | 110,249 | 100,434 |
Guarantor Subsidiaries | Energy Technology | ||||
Revenue: | ||||
Total revenue | 5,821 | 3,280 | 6,480 | 4,362 |
Cost of revenue: | ||||
Total cost of revenue | 2,365 | 1,464 | 2,572 | 2,083 |
Non-Guarantor Subsidiaries | ||||
Revenue: | ||||
Total revenue | 10,471 | 9,031 | 21,612 | 10,706 |
Cost of revenue: | ||||
Total cost of revenue | 7,065 | 6,370 | 14,739 | 7,839 |
Gross profit | 3,406 | 2,661 | 6,873 | 2,867 |
Operating expenses: | ||||
Amortization | 369 | 362 | 737 | 362 |
Selling, general and administrative | 1,618 | 1,142 | 3,192 | 1,395 |
Total operating expenses | 1,987 | 1,504 | 3,929 | 1,757 |
Operating income | 1,419 | 1,157 | 2,944 | 1,110 |
Other income (expense): | ||||
Other, net | 29 | -61 | -160 | -94 |
Total other income (expense), net | 29 | -61 | -160 | -94 |
Loss from continuing operations before income taxes | 1,448 | 1,096 | 2,784 | 1,016 |
Income tax benefit (provision) | -140 | -180 | -270 | -180 |
Loss from continuing operations | 1,308 | 916 | 2,514 | 836 |
Income (loss) from discontinued operations, net of income taxes | -210 | -210 | ||
Net loss | 1,098 | 916 | 2,304 | 836 |
Net income attributable to non-controlling interest | -259 | -236 | -504 | -230 |
Net loss attributable to Headwaters Incorporated | 839 | 680 | 1,800 | 606 |
Non-Guarantor Subsidiaries | Building Products | ||||
Revenue: | ||||
Total revenue | 10,471 | 9,031 | 21,612 | 10,706 |
Cost of revenue: | ||||
Total cost of revenue | 7,065 | 6,370 | 14,739 | 7,839 |
Parent Company | ||||
Operating expenses: | ||||
Selling, general and administrative | 6,097 | 5,765 | 10,750 | 10,938 |
Total operating expenses | 6,097 | 5,765 | 10,750 | 10,938 |
Operating income | -6,097 | -5,765 | -10,750 | -10,938 |
Other income (expense): | ||||
Net interest expense | -35,905 | -12,088 | -47,813 | -22,123 |
Equity in earnings of subsidiaries | 12,325 | 3,574 | 34,125 | 15,225 |
Total other income (expense), net | -23,580 | -8,514 | -13,688 | -6,898 |
Loss from continuing operations before income taxes | -29,677 | -14,279 | -24,438 | -17,836 |
Income tax benefit (provision) | 4,220 | 3,961 | 5,820 | 6,090 |
Loss from continuing operations | -25,457 | -10,318 | -18,618 | -11,746 |
Net loss | -25,457 | -10,318 | -18,618 | -11,746 |
Net loss attributable to Headwaters Incorporated | ($25,457) | ($10,318) | ($18,618) | ($11,746) |
Condensed_Consolidating_Financ5
Condensed Consolidating Financial Information (Details 4) (USD $) | 3 Months Ended | 6 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 |
Cash flows from operating activities: | ||||
Net income (loss) | ($25,198) | ($10,082) | ($18,114) | ($11,516) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 25,856 | 26,460 | ||
Interest expense related to amortization of debt issue costs and debt discount | 4,500 | 600 | 5,042 | 1,153 |
Stock-based compensation | 700 | 500 | 1,339 | 1,016 |
Deferred income taxes | 477 | 214 | ||
Net loss on disposition of property, plant and equipment | 113 | 373 | ||
Loss (gain) on sale of discontinued operations, net of income taxes | 241 | -3,117 | ||
Net loss of unconsolidated joint ventures | 234 | 133 | ||
Decrease in trade receivables | 28,347 | 30,911 | ||
Decrease (increase) in inventories | -10,628 | -9,754 | ||
Decrease in accounts payable and accrued liabilities | -47,580 | -23,598 | ||
Other changes in operating assets and liabilities, net | -8,769 | -5,530 | ||
Net cash provided by (used in) operating activities | -23,442 | 6,745 | ||
Cash flows from investing activities: | ||||
Business acquisitions | -1,200 | -60,619 | ||
Investments in unconsolidated joint ventures | -125 | -1,000 | ||
Purchase of property, plant and equipment | -8,703 | -9,056 | -17,474 | -15,944 |
Proceeds from disposition of property, plant and equipment | 640 | 358 | ||
Proceeds from sale of discontinued operations | 0 | 4,666 | ||
Net decrease in long-term receivables and deposits | 3,650 | 5,825 | ||
Net change in other assets | -344 | 24 | ||
Net cash provided by (used in) investing activities | -14,853 | -66,690 | ||
Cash flows from financing activities: | ||||
Net proceeds from issuance of long-term debt | 414,675 | 146,200 | ||
Payments on long-term debt | -448,736 | -7,792 | ||
Dividends paid to non-controlling interest in consolidated subsidiary | -927 | 0 | ||
Employee stock purchases | 464 | 454 | ||
Net cash provided by (used in) financing activities | -34,524 | 138,862 | ||
Net increase (decrease) in cash and cash equivalents | -72,819 | 78,917 | ||
Cash and cash equivalents, beginning of period | 152,542 | 75,316 | ||
Cash and cash equivalents, end of period | 79,723 | 154,233 | 79,723 | 154,233 |
Consolidation, Eliminations | ||||
Cash flows from operating activities: | ||||
Net income (loss) | -12,325 | -3,574 | -34,125 | -15,225 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Equity in earnings of subsidiaries | 12,325 | 3,574 | 34,125 | 15,225 |
Guarantor Subsidiaries | ||||
Cash flows from operating activities: | ||||
Net income (loss) | 11,486 | 2,894 | 32,325 | 14,619 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 24,223 | 25,582 | ||
Stock-based compensation | 496 | 404 | ||
Deferred income taxes | 295 | 214 | ||
Net loss on disposition of property, plant and equipment | 112 | 328 | ||
Loss (gain) on sale of discontinued operations, net of income taxes | 45 | -3,117 | ||
Decrease in trade receivables | 28,597 | 30,264 | ||
Decrease (increase) in inventories | -10,071 | -11,139 | ||
Decrease in accounts payable and accrued liabilities | -23,170 | -21,882 | ||
Other changes in operating assets and liabilities, net | 2,554 | -15,224 | ||
Net cash provided by (used in) operating activities | 55,406 | 20,049 | ||
Cash flows from investing activities: | ||||
Business acquisitions | -1,200 | -3,100 | ||
Investments in unconsolidated joint ventures | -125 | |||
Purchase of property, plant and equipment | -14,496 | -13,505 | ||
Proceeds from disposition of property, plant and equipment | 640 | 358 | ||
Proceeds from sale of discontinued operations | 4,666 | |||
Net decrease in long-term receivables and deposits | 2,584 | 5,527 | ||
Net change in other assets | -437 | -192 | ||
Net cash provided by (used in) investing activities | -13,034 | -6,246 | ||
Cash flows from financing activities: | ||||
Employee stock purchases | 342 | 344 | ||
Intercompany transfers | -39,633 | |||
Net cash provided by (used in) financing activities | -39,291 | 344 | ||
Net increase (decrease) in cash and cash equivalents | 3,081 | 14,147 | ||
Cash and cash equivalents, beginning of period | 33,552 | 70,713 | ||
Cash and cash equivalents, beginning of period | 33,552 | |||
Cash and cash equivalents, end of period | 36,633 | 84,860 | 36,633 | 84,860 |
Cash and cash equivalents, end of period | 36,633 | 36,633 | ||
Non-Guarantor Subsidiaries | ||||
Cash flows from operating activities: | ||||
Net income (loss) | 1,098 | 916 | 2,304 | 836 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 1,421 | 748 | ||
Deferred income taxes | 182 | |||
Net loss on disposition of property, plant and equipment | 1 | |||
Loss (gain) on sale of discontinued operations, net of income taxes | 196 | |||
Net loss of unconsolidated joint ventures | 234 | 133 | ||
Decrease in trade receivables | -250 | 647 | ||
Decrease (increase) in inventories | -557 | 1,385 | ||
Decrease in accounts payable and accrued liabilities | 2,248 | -331 | ||
Other changes in operating assets and liabilities, net | -7,521 | 1,320 | ||
Net cash provided by (used in) operating activities | -1,742 | 4,738 | ||
Cash flows from investing activities: | ||||
Investments in unconsolidated joint ventures | -1,000 | |||
Purchase of property, plant and equipment | -259 | -678 | ||
Net cash provided by (used in) investing activities | -259 | -1,678 | ||
Cash flows from financing activities: | ||||
Dividends paid to non-controlling interest in consolidated subsidiary | -927 | |||
Employee stock purchases | 16 | |||
Intercompany transfers | 123 | |||
Net cash provided by (used in) financing activities | -788 | |||
Net increase (decrease) in cash and cash equivalents | -2,789 | 3,060 | ||
Cash and cash equivalents, beginning of period | 5,764 | 34 | ||
Cash and cash equivalents, end of period | 2,975 | 3,094 | 2,975 | 3,094 |
Parent Company | ||||
Cash flows from operating activities: | ||||
Net income (loss) | -25,457 | -10,318 | -18,618 | -11,746 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||
Depreciation and amortization | 212 | 130 | ||
Interest expense related to amortization of debt issue costs and debt discount | 5,042 | 1,153 | ||
Stock-based compensation | 843 | 612 | ||
Net loss on disposition of property, plant and equipment | 45 | |||
Equity in earnings of subsidiaries | -12,325 | -3,574 | -34,125 | -15,225 |
Decrease in accounts payable and accrued liabilities | -26,658 | -1,385 | ||
Other changes in operating assets and liabilities, net | -3,802 | 8,374 | ||
Net cash provided by (used in) operating activities | -77,106 | -18,042 | ||
Cash flows from investing activities: | ||||
Business acquisitions | -57,519 | |||
Purchase of property, plant and equipment | -2,719 | -1,761 | ||
Net decrease in long-term receivables and deposits | 1,066 | 298 | ||
Net change in other assets | 93 | 216 | ||
Net cash provided by (used in) investing activities | -1,560 | -58,766 | ||
Cash flows from financing activities: | ||||
Net proceeds from issuance of long-term debt | 414,675 | 146,200 | ||
Payments on long-term debt | -448,736 | -7,792 | ||
Employee stock purchases | 106 | 110 | ||
Intercompany transfers | 39,510 | |||
Net cash provided by (used in) financing activities | 5,555 | 138,518 | ||
Net increase (decrease) in cash and cash equivalents | -73,111 | 61,710 | ||
Cash and cash equivalents, beginning of period | 113,226 | 4,569 | ||
Cash and cash equivalents, end of period | $40,115 | $66,279 | $40,115 | $66,279 |