Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 30, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | HC2 Holdings, Inc. | |
Entity Central Index Key | 1,006,837 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 42,155,860 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement [Abstract] | ||
Services revenue | $ 235,928 | $ 182,109 |
Sales revenue | 118,614 | 120,497 |
Life, accident and health earned premiums, net | 19,941 | 19,934 |
Net investment income | 15,304 | 14,079 |
Net realized gains (losses) on investments | 781 | (4,875) |
Net revenue | 390,568 | 331,744 |
Operating expenses | ||
Cost of revenue - services | 219,612 | 174,873 |
Cost of revenue - sales | 94,802 | 99,677 |
Policy benefits, changes in reserves, and commissions | 31,487 | 34,020 |
Selling, general and administrative | 39,856 | 35,597 |
Depreciation and amortization | 7,397 | 5,955 |
Other operating (income) expenses | (3,558) | 887 |
Total operating expenses | 389,596 | 351,009 |
Income (loss) from operations | 972 | (19,265) |
Interest expense | (14,115) | (10,326) |
Loss on contingent consideration | (231) | 0 |
Income (loss) from equity investees | 7,693 | (3,576) |
Other income (expense), net | (4,910) | (714) |
Loss from continuing operations before income taxes | (10,591) | (33,881) |
Income tax (expense) benefit | (5,291) | 2,539 |
Net loss | (15,882) | (31,342) |
Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest | 1,386 | 880 |
Net loss attributable to HC2 Holdings, Inc. | (14,496) | (30,462) |
Less: Preferred stock and deemed dividends from conversions | 583 | 1,069 |
Net loss attributable to common stock and participating preferred stockholders | $ (15,079) | $ (31,531) |
Loss per Common Share | ||
Basic (in usd per share) | $ (0.36) | $ (0.89) |
Diluted (in usd per share) | $ (0.36) | $ (0.89) |
Weighted average common shares outstanding: | ||
Basic (in shares) | 41,948 | 35,262 |
Diluted (in shares) | 41,948 | 35,262 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (15,882) | $ (31,342) |
Other comprehensive income (loss) | ||
Foreign currency translation adjustment | 1,125 | 1,823 |
Unrealized gain (loss) on available-for-sale securities | 11,976 | 18,617 |
Other comprehensive income | 13,101 | 20,440 |
Comprehensive loss | (2,781) | (10,902) |
Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest | 1,386 | 880 |
Comprehensive loss attributable to HC2 Holdings, Inc. | $ (1,395) | $ (10,022) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Investments: | ||
Fixed maturities, available-for-sale at fair value | $ 1,302,549 | $ 1,278,958 |
Equity securities, available-for-sale at fair value | 51,897 | 51,519 |
Mortgage loans | 21,824 | 16,831 |
Policy loans | 18,106 | 18,247 |
Other invested assets | 80,580 | 62,363 |
Total investments | 1,474,956 | 1,427,918 |
Cash and cash equivalents | 127,003 | 115,371 |
Accounts receivable, net | 228,058 | 267,598 |
Recoverable from reinsurers | 524,845 | 524,201 |
Deferred tax asset | 440 | 1,108 |
Property, plant and equipment, net | 284,304 | 286,458 |
Goodwill | 98,086 | 98,086 |
Intangibles, net | 38,382 | 39,722 |
Other assets | 80,288 | 74,814 |
Total assets | 2,856,362 | 2,835,276 |
Liabilities, temporary equity and stockholders’ equity | ||
Life, accident and health reserves | 1,665,459 | 1,648,565 |
Annuity reserves | 249,371 | 251,270 |
Value of business acquired | 46,509 | 47,613 |
Accounts payable and other current liabilities | 236,157 | 251,733 |
Deferred tax liability | 15,550 | 15,304 |
Long-term obligations | 445,620 | 428,496 |
Other liabilities | 98,795 | 92,871 |
Total liabilities | 2,757,461 | 2,735,852 |
Commitments and contingencies | ||
Temporary equity: | ||
Preferred stock | 29,479 | 29,459 |
Redeemable noncontrolling interest | 2,958 | 2,526 |
Total temporary equity | 32,437 | 31,985 |
Stockholders’ equity | ||
Common stock, $.001 par value; Shares authorized: 80,000,000 at March 31, 2017 and December 31, 2016; Shares issued: 42,520,073 and 42,070,675 at March 31, 2017 and December 31, 2016; Shares outstanding: 42,155,860 and 41,811,288 at March 31, 2017 and December 31, 2016, respectively | 42 | 42 |
Additional paid-in capital | 243,698 | 241,485 |
Treasury stock, at cost; 364,213 and 259,387 shares at March 31, 2017 and December 31, 2016, respectively | (1,968) | (1,387) |
Accumulated deficit | (188,774) | (174,278) |
Accumulated other comprehensive loss | (8,546) | (21,647) |
Total HC2 Holdings, Inc. stockholders’ equity | 44,452 | 44,215 |
Noncontrolling interest | 22,012 | 23,224 |
Total stockholders’ equity | 66,464 | 67,439 |
Total liabilities, temporary equity and stockholders’ equity | $ 2,856,362 | $ 2,835,276 |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued (in shares) | 42,520,073 | 42,070,675 |
Common stock, shares outstanding (in shares) | 42,155,860 | 41,811,288 |
Treasury stock, shares | 364,213 | 259,387 |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Treasury Stock | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Income (Loss) | Total HC2 Stockholders' Equity | Non- controlling Interest | Temporary Equity |
Beginning balance (in shares) at Dec. 31, 2015 | 35,250,000 | ||||||||
Beginning balance at Dec. 31, 2015 | $ 117,524 | $ 35 | $ 209,477 | $ (378) | $ (79,729) | $ (35,375) | $ 94,030 | $ 23,494 | $ 55,741 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation expense | 2,582 | 2,582 | 2,582 | 609 | |||||
Preferred stock dividend and accretion | (1,014) | (1,014) | (1,014) | ||||||
Preferred stock beneficial conversion feature | (55) | (55) | (55) | 55 | |||||
Issuance of restricted stock (in shares) | 65,000 | ||||||||
Transactions with noncontrolling interests | 6,167 | (723) | (723) | 5,444 | |||||
Net loss | (30,701) | (30,462) | (30,462) | (239) | |||||
Net loss | (31,342) | (641) | |||||||
Comprehensive loss attributable to HC2 Holdings, Inc. | 20,440 | 20,440 | 20,440 | ||||||
Ending balance (in shares) at Mar. 31, 2016 | 35,315,000 | ||||||||
Ending balance at Mar. 31, 2016 | 114,943 | $ 35 | 211,713 | (378) | (110,191) | (14,935) | 86,244 | 28,699 | 55,764 |
Beginning balance (in shares) at Dec. 31, 2016 | 41,811,000 | ||||||||
Beginning balance at Dec. 31, 2016 | 67,439 | $ 42 | 241,485 | (1,387) | (174,278) | (21,647) | 44,215 | 23,224 | 31,985 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Share-based compensation expense | 2,593 | 2,593 | 2,593 | ||||||
Fair value adjustment of redeemable noncontrolling interest | (275) | (275) | (275) | 275 | |||||
Preferred stock dividend and accretion | (563) | (563) | (563) | ||||||
Preferred stock beneficial conversion feature | (20) | (20) | (20) | 20 | |||||
Issuance of restricted stock (in shares) | 321,000 | ||||||||
Issuance of restricted stock | $ 16 | 16 | 16 | ||||||
Exercise of Stock Option (in shares) | 128,539 | 129,000 | |||||||
Exercise of stock options | $ 462 | 462 | 462 | ||||||
Taxes paid in lieu of shares issued for share-based compensation, shares | (105,000) | ||||||||
Taxes paid in lieu of shares issued for share-based compensation | (581) | (581) | (581) | ||||||
Transactions with noncontrolling interests | 331 | ||||||||
Net loss | (15,708) | (14,496) | (14,496) | (1,212) | |||||
Net loss | (15,882) | (174) | |||||||
Comprehensive loss attributable to HC2 Holdings, Inc. | 13,101 | 13,101 | 13,101 | ||||||
Ending balance (in shares) at Mar. 31, 2017 | 42,156,000 | ||||||||
Ending balance at Mar. 31, 2017 | $ 66,464 | $ 42 | $ 243,698 | $ (1,968) | $ (188,774) | $ (8,546) | $ 44,452 | $ 22,012 | $ 32,437 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (15,882) | $ (31,342) |
Adjustments to reconcile net loss to cash provided by (used in) operating activities: | ||
Provision for doubtful accounts receivable | (411) | 112 |
Share-based compensation expense | 1,519 | 3,191 |
Depreciation and amortization | 8,637 | 7,884 |
Amortization of deferred financing costs and debt discount / premium | 2,707 | 495 |
Amortization of discount / premium on investments | 2,834 | 3,361 |
(Gain) loss on sale or disposal of assets | (3,752) | 887 |
(Income) loss from equity investees | (7,693) | 3,576 |
Impairment of investments | 3,269 | 2,686 |
Net realized / unrealized (gains) losses on investments | (368) | 3,067 |
Loss on contingent consideration | 231 | 0 |
Receipt of dividends from equity investees | 917 | 7,214 |
Deferred income taxes | (4,443) | (12,311) |
Annuity benefits | 2,172 | 2,256 |
Other operating activities | 203 | 112 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts receivable | 40,322 | 15,211 |
Recoverable from reinsurers | (644) | 3,689 |
Other assets | (5,131) | 26,879 |
Life, accident and health and Annuity reserves | 18,219 | 20,914 |
Accounts payable and other current liabilities | 16,444 | (42,324) |
Other liabilities | (26,374) | 1,268 |
Cash provided by operating activities: | 32,776 | 16,825 |
Cash flows from investing activities: | ||
Purchase of property, plant and equipment | (9,413) | (6,512) |
Disposal of property, plant and equipment | 161 | 471 |
Purchase of investments | (56,636) | (73,606) |
Sale of investments | 23,073 | 32,765 |
Maturities and redemptions of investments | 24,092 | 18,052 |
Purchase of equity method investments | (10,200) | 0 |
Cash paid for business acquisitions, net of cash acquired | 0 | (6,469) |
Other investing activities | 154 | 172 |
Cash used in investing activities: | (28,769) | (35,127) |
Cash flows from financing activities: | ||
Proceeds from long-term obligations | 53,655 | 2,360 |
Principal payments on long-term obligations | (40,664) | (3,156) |
Annuity receipts | 873 | 785 |
Annuity surrenders | (6,269) | (5,149) |
Transactions with noncontrolling interests | 331 | 2,000 |
Payment of dividends | (1,322) | (1,014) |
Other financing activities | (117) | 0 |
Cash provided by financing activities: | 6,487 | (4,174) |
Effects of exchange rate changes on cash and cash equivalents | 1,138 | 1,552 |
Net change in cash and cash equivalents | 11,632 | (20,924) |
Cash and cash equivalents, beginning of period | 115,371 | 158,624 |
Cash and cash equivalents, end of period | 127,003 | 137,700 |
Supplemental cash flow information: | ||
Cash paid for interest | 1,456 | 1,465 |
Cash paid for taxes | 264 | 639 |
Non-cash investing and financing activities: | ||
Property, plant and equipment included in accounts payable | 740 | 946 |
Investments in accounts payable | 10,320 | 7,180 |
Dividends payable to shareholders | $ 563 | $ 988 |
Organization and Business
Organization and Business | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | 1. Organization and Business HC2 Holdings, Inc. (“HC2” and, together with its subsidiaries, the “Company”, “we” and “our”) is a diversified holding company which seeks to acquire and grow attractive businesses that we believe can generate long-term sustainable free cash flow and attractive returns. While the Company generally intends to acquire controlling equity interests in its operating subsidiaries, the Company may invest to a limited extent in a variety of debt instruments or noncontrolling equity interest positions. The Company’s shares of common stock trade on the NYSE MKT LLC under the symbol “HCHC”. The Company currently has seven reportable segments based on management’s organization of the enterprise - Construction, Marine Services, Energy, Telecommunications, Insurance, Life Sciences, and Other, which includes businesses that do not meet the separately reportable segment thresholds. 1. Our Construction segment includes DBM Global Inc. (“DBMG”) and its wholly-owned subsidiaries. DBMG is a fully integrated detailer, BIM modeler, fabricator and erector of structural steel and heavy steel plate. DBMG details, models, fabricates and erects structural steel for commercial and industrial construction projects such as high- and low-rise buildings and office complexes, hotels and casinos, convention centers, sports arenas, shopping malls, hospitals, dams, bridges, mines and power plants. DBMG also fabricates trusses and girders and specializes in the fabrication and erection of large-diameter water pipe and water storage tanks. Through Aitken, DBMG manufactures pollution control scrubbers, tunnel liners, pressure vessels, strainers, filters, separators and a variety of customized products. The Company maintains a 92% controlling interest in DBMG. 2. Our Marine Services segment includes Global Marine Systems Limited ("GMSL"). GMSL is a leading provider of engineering and underwater services on submarine cables. The Company maintains a 95% equity interest in GMSL. 3. Our Energy segment includes American Natural Gas ("ANG"). ANG is a premier distributor of natural gas motor fuel. ANG designs, builds, owns, acquires, operates and maintains compressed natural gas fueling stations for transportation vehicles. The Company maintains effective control of, and a 49.99% ownership interest in ANG. 4. Our Telecommunications segment includes PTGi International Carrier Services, ("ICS"). ICS operates a telecommunications business including a network of direct routes and provides premium voice communication services for national telecommunications operators, mobile operators, wholesale carriers, prepaid operators, Voice over Internet Protocol ("VOIP") service operators and Internet service providers from our International Carrier Services business unit. ICS provides a quality service via direct routes and by forming strong relationships with carefully selected partners. The Company owns 100% of ICS. 5. Our Insurance segment includes Continental General Insurance Company ("CGI" or the "Insurance Company"). CGI provides long-term care, life and annuity coverage that help protect policy and certificate holders from the financial hardships associated with illness, injury, loss of life, or income continuation. The Company owns 100% of the Insurance Company. 6. Our Life Sciences segment includes Pansend Life Sciences, LLC (“Pansend”). Pansend owns a (i) 77% interest in Genovel Orthopedics, Inc. ("Genovel"), which seeks to develop products to treat early osteoarthritis of the knee, (ii) 71% interest in R2 Dermatology Inc. ("R2", f/k/a GemDerm Aesthetics, Inc.), which develops skin lightening technology, and (iii) 80% interest in BeneVir Biopharm, Inc. ("BeneVir"), which focuses on immunotherapy for the treatment of solid tumors. Pansend also invests in other early stage or developmental stage healthcare companies including a 45% interest in Medibeacon Inc., and Triple Ring Technologies, Inc. 7. In our Other segment, we invest in and grow developmental stage companies that we believe have significant growth potential. Among the businesses included in this segment is the Company's 56% ownership interest in 704Games Company ("704Games" f/k/a DMi, Inc.), which owns licenses to create and distribute NASCAR® video games, and the Company's 72% interest in NerVve Technologies, Inc. ("NerVve"), which provides analytics on broadcast TV, digital and social media online platforms. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of the Company included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The financial statements reflect all adjustments that are, in the opinion of management, necessary for a fair statement of such information. All such adjustments are of a normal recurring nature. Certain information and note disclosures, including a description of significant accounting policies normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), have been condensed or omitted pursuant to such rules and regulations. Certain prior amounts have been reclassified or combined to conform to the current year presentation. These reclassifications and combinations had no effect on previously reported net loss attributable to controlling interest or accumulated deficit. These interim financial statements should be read in conjunction with the Company’s annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016, filed with the SEC on March 9, 2017, as amended by amendment no.1, filed on March 28, 2017 (collectively "Form 10-K"). The results of operations for the three months ended March 31, 2017 are not necessarily indicative of the results for any subsequent periods or the entire fiscal year ending December 31, 2017. New Accounting Pronouncements The Company has implemented all new accounting pronouncements that are in effect and that may impact its Condensed Consolidated Financial Statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial condition, results of operations or liquidity. Accounting Principles Early Adopted During the Fiscal Year Testing for Goodwill Impairment In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. Topic 350, Intangibles - Goodwill and Other (Topic 350), currently requires an entity that has not elected the private company alternative for goodwill to perform a two-step test to determine the amount, if any, of goodwill impairment. In Step 1, an entity compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, the entity performs Step 2 and compares the implied fair value of goodwill with the carrying amount of the goodwill for that reporting unit. An impairment charge equal to the amount by which the carrying amount of goodwill for the reporting unit exceeds the implied fair value of that goodwill is recorded, limited to the amount of goodwill allocated to that reporting unit. To address concerns over the cost and complexity of the two-step goodwill impairment test, the amendments in this ASU remove the second step of the test. An entity will now apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new guidance does not amend the optional qualitative assessment of goodwill impairment. The Company elected to early adopt ASU 2017-04 effective March 31, 2017, resulting in no impact to the Condensed Consolidated Financial Statements. New Accounting Pronouncements to be Adopted Subsequent to the Fiscal Year Revenue Recognition In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in Revenue Recognition (Topic 605). Under the new guidance, an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal Versus Agent Considerations, which clarifies the guidance in ASU 2014-09. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, an update on identifying performance obligations and accounting for licenses of intellectual property. In May 2016, the FASB issued ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, which includes amendments for enhanced clarification of the guidance. In December 2016, the FASB issued ASU 2016-20, Technical Corrections and Improvements to Revenue from Contracts with Customers (Topic 606), which includes amendments of a similar nature to the items typically addressed in the technical corrections and improvements project. Lastly, in February 2017, the FASB issued ASU 2017-05, clarifying the scope of asset derecognition guidance and accounting for partial sales of nonfinancial assets to clarify the scope of ASC 610-20, Other Income - Gains and Losses from Derecognition of Nonfinancial Assets, and provide guidance on partial sales of nonfinancial assets. This ASU clarifies that the unit of account under ASU 610-20 is each distinct nonfinancial or in substance nonfinancial asset and that a financial asset that meets the definition of an “in substance nonfinancial asset” is within the scope of ASC 610-20. This ASU eliminates rules specifically addressing sales of real estate and removes exceptions to the financial asset derecognition model. The ASUs described above are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. During the three month ended March 31, 2017, the Company continued its evaluation of ASU 2014-09, including the expected impact on its business processes, systems and controls, and potential differences in the timing and/or method of revenue recognition for its contracts. The Company expects to complete its assessment of the cumulative effect of adopting ASU 2014-09 as well as the expected impact of adoption during 2017. The Company will continue its evaluation of ASU 2014-09, including how it may impact new contracts it receives as well as new or emerging interpretations of the standard, through the date of adoption. The Company expects to adopt the revenue recognition ASUs described above in its Consolidated Financial Statements beginning in January 1, 2018 and is currently evaluating the impact the update would have. Subsequent Events ASC 855, “Subsequent Events” (“ASC 855”), establishes general standards of accounting and disclosure of events that occur after the balance sheet date but before financial statements are issued or available to be issued. ASC 855 requires HC2 to evaluate events that occur after the balance date as of which HC2's financial statements are issued, and to determine whether adjustments to or additional disclosures in the financial statements are necessary. HC2 has evaluated subsequent events through the date these financial statements were issued. See Note 22. Subsequent Events for the summary of the subsequent events. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combinations | 3. Business Combinations Construction Segment On October 13, 2016, DBMG acquired the detailing and Building Information Modeling (“BIM”) management business of PDC Global Pty Ltd. (“PDC”). The new businesses provide steel detailing, BIM modelling and BIM management services for industrial and commercial construction projects in Australia and North America. On November 1, 2016, DBMG acquired BDS VirCon ("BDS"). BDS provides steel detailing, rebar detailing and BIM modelling services for industrial and commercial projects in Australia, New Zealand, North America and Europe. The aggregate fair value of the consideration paid in connection with the acquisition of PDC and BDS was $25.5 million , including $21.4 million in cash. Both transactions were accounted for as business acquisitions. The preliminary fair value of consideration transferred and its allocation among the identified assets acquired, liabilities assumed, intangibles and residual goodwill are summarized as follows (in thousands): Purchase price allocation Cash and cash equivalents $ 621 Accounts receivable, net 5,558 Costs and recognized earnings in excess of billings on uncompleted contracts 1,686 Property, plant and equipment, net 8,043 Goodwill 11,827 Intangibles 3,955 Other assets 1,209 Total assets acquired 32,899 Accounts payable and other current liabilities (5,924 ) Billings in excess of costs and recognized earnings on uncompleted contracts (617 ) Deferred tax liability (169 ) Other liabilities (685 ) Total liabilities assumed (7,395 ) Total net assets acquired $ 25,504 The preliminary allocation of the fair value of the acquired businesses was based upon a preliminary valuation. Our estimates and assumptions are subject to change as we obtain additional information for our estimates during the measurement period. The primary areas of preliminary allocation of the fair values of consideration transferred that are not yet finalized relate to the fair values of certain tangible and intangible assets acquired and the residual goodwill. We expect to complete the purchase price allocation for fiscal year 2016 acquisitions during fiscal year 2017. Goodwill was determined based on the residual differences between fair value of consideration transferred and the value assigned to tangible and intangible assets and liabilities. Among the factors that contributed to goodwill was approximately $2.9 million assigned to the assembled and trained workforce. Goodwill is not amortized and is not deductible for tax purposes. Acquisition costs incurred by DMBG in connection with the acquisition of PDC and BDS were approximately $2.5 million of which $0.2 million were for the three months ended March 31, 2017, and were included in selling, general and administrative expenses. The acquisition costs were primarily related to legal, accounting and valuation services. PDC's and BDS' results were included in our Condensed Consolidated Statement of Operations since their respective acquisition dates. Pro forma results of operations for the acquisition of PDC and BDS have not been presented because they are not material to our consolidated results of operations. Energy Segment For the year ended December 31, 2016, ANG completed four acquisitions of twenty-one fueling stations in aggregate. The total fair value of the consideration transferred by ANG in connection with the acquisitions was $42.1 million , comprised of $39.2 million in cash and a $2.9 million 4.25% seller note, due in 2022. See Note 12. Long-term Obligations for further details. Two of the transactions were accounted for as an asset acquisition because substantially all of the fair value of the gross assets acquired was concentrated in a group of similar identifiable assets related to acquired stations. For the transactions accounted for as a business combination, the fair value of consideration transferred was allocated among the identified assets acquired, liabilities assumed, intangibles and residual goodwill. For the two transactions accounted for as asset acquisitions the preliminary fair value of consideration transferred was preliminarily allocated based on the relative fair value (in thousands): Purchase price allocation Accounts receivable $ 1,303 Property, plant and equipment, net 42,758 Goodwill 1,257 Intangibles 4,984 Other assets 79 Total assets acquired 50,381 Accounts payable and other current liabilities (898 ) Deferred tax liability (7,086 ) Total liabilities assumed (7,984 ) Bargain purchase gain (340 ) Total net assets acquired $ 42,057 The preliminary allocation of the fair value of the acquired businesses was based upon a preliminary valuation. Our estimates and assumptions are subject to change as we obtain additional information for our estimates during the measurement period. The primary areas of preliminary allocation of the fair values of consideration transferred that are not yet finalized relate to the fair values of certain property, plant and equipment, deferred tax liability, intangible assets acquired and the residual goodwill. We expect to complete the purchase price allocation for fiscal year 2016 acquisitions during fiscal year 2017. Approximately $5.0 million of the fair value of consideration transferred has been provisionally assigned to customer contracts with an estimated useful life ranging between four and fifteen years. The multi-period excess earnings method was used to assign fair value to the acquired customer contracts. Goodwill was determined based on the residual differences between fair value of consideration transferred and the value assigned to tangible and intangible assets and liabilities. Goodwill is not amortized and is not deductible for tax purposes. Results of operations from the acquired stations since acquisition dates have been included in our Condensed Consolidated Statement of Operations. Pro forma results of operations for ANG's acquisitions have not been presented because they are not material to our consolidated results of operations. Other Acquisitions During the year ended December 31, 2016 we completed the acquisition of additional interests in and thereby control of NerVve and BeneVir, and acquired a 60% controlling interest in CWind Limited ("CWind") with an obligation to purchase the remaining 40% in equal amounts on September 30, 2016 and September 30, 2017 (based on agreed financial targets). The total consideration transferred for these acquisitions was $14.9 million , including $9.2 million in cash. On November 1, 2016, we completed the renegotiation of the deferred purchase obligation to purchase the outstanding 40% minority interest of CWind and purchased the remaining 40% on that date. All three transactions were accounted for as business acquisitions. Results of operations from other acquisitions since the respective acquisition dates have been included in our Condensed Consolidated Statement of Operations. Pro forma results of operations for other acquisitions have not been presented because they are not material to our consolidated results of operations. The following table summarizes the allocation of the purchase price to the fair value of identifiable assets acquired, liabilities assumed, intangibles and residual goodwill (in thousands): Purchase price allocation Cash and cash equivalents $ 2,963 Restricted cash 3 Accounts receivable 6,400 Inventory 528 Property, plant and equipment, net 29,896 Goodwill 5,541 Intangibles 7,082 Other assets 2,051 Total assets acquired 54,464 Accounts payable and other current liabilities (11,180 ) Deferred tax liability (2,819 ) Long-term obligations (20,813 ) Other liabilities (3 ) Noncontrolling interest (815 ) Total liabilities assumed (35,630 ) Enterprise value 18,834 Less fair value of noncontrolling interest 3,889 Total net assets acquired $ 14,945 |
Investments
Investments | 3 Months Ended |
Mar. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | 4. Investments Fixed Maturity and Equity Securities Available-for-Sale The following tables provide information relating to investments in fixed maturity and equity securities (in thousands): March 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Fixed maturity securities U.S. Government and government agencies $ 15,720 $ 198 $ (64 ) $ 15,854 States, municipalities and political subdivisions 375,894 7,760 (2,944 ) 380,710 Foreign government 6,368 — (497 ) 5,871 Residential mortgage-backed securities 129,664 5,091 (2,498 ) 132,257 Commercial mortgage-backed securities 40,689 379 (173 ) 40,895 Asset-backed securities 96,593 830 (916 ) 96,507 Corporate and other 599,602 32,924 (2,071 ) 630,455 Total fixed maturity securities $ 1,264,530 $ 47,182 $ (9,163 ) $ 1,302,549 Equity securities Common stocks $ 16,797 $ 44 $ (2,627 ) $ 14,214 Perpetual preferred stocks 37,033 701 (51 ) 37,683 Total equity securities $ 53,830 $ 745 $ (2,678 ) $ 51,897 December 31, 2016 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Fixed maturity securities U.S. Government and government agencies $ 15,910 $ 135 $ (95 ) $ 15,950 States, municipalities and political subdivisions 374,527 4,408 (3,858 ) 375,077 Foreign government 6,380 — (402 ) 5,978 Residential mortgage-backed securities 136,126 2,634 (564 ) 138,196 Commercial mortgage-backed securities 48,715 427 (89 ) 49,053 Asset-backed securities 76,303 1,934 (572 ) 77,665 Corporate and other 600,458 23,635 (7,054 ) 617,039 Total fixed maturity securities $ 1,258,419 $ 33,173 $ (12,634 ) $ 1,278,958 Equity securities Common stocks $ 16,236 $ — $ (1,371 ) $ 14,865 Perpetual preferred stocks 37,041 191 (578 ) 36,654 Total equity securities $ 53,277 $ 191 $ (1,949 ) $ 51,519 The Company has investments in mortgage-backed securities ("MBS") that contain embedded derivatives (primarily interest-only MBS) that do not qualify for hedge accounting. The Company recorded the change in the fair value of these securities within Net realized gains (losses) on investments . These investments had a fair value of $14.7 million and $15.2 million as of March 31, 2017 and December 31, 2016 , respectively. The change in fair value related to these securities resulted in a net gain of approximately $0.1 million for the three months ended March 31, 2017 and a net loss of approximately $1.7 million for the three months ended March 31, 2016 . Maturities of Fixed Maturity Securities Available-for-Sale The amortized cost and fair value of fixed maturity securities available-for-sale as of March 31, 2017 are shown by contractual maturity in the table below (in thousands). Actual maturities can differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Asset and mortgage-backed securities are shown separately in the table below, as they are not due at a single maturity date: Amortized Cost Fair Value Corporate, Municipal, U.S. Government and Other securities Due in one year or less $ 48,251 $ 48,296 Due after one year through five years 112,721 117,770 Due after five years through ten years 140,161 143,746 Due after ten years 696,451 723,078 Subtotal 997,584 1,032,890 Mortgage-backed securities 170,353 173,152 Asset-backed securities 96,593 96,507 Total $ 1,264,530 $ 1,302,549 Corporate and Other Fixed Maturity Securities The tables below show the major industry types of the Company’s corporate and other fixed maturity securities (in thousands): March 31, 2017 December 31, 2016 Amortized Cost Fair Value % of Total Amortized Cost Fair % of Finance, insurance, and real estate $ 203,453 $ 207,732 32.9 % $ 214,911 $ 211,834 34.3 % Transportation, communication and other services 177,685 187,253 29.7 % 180,647 189,163 30.7 % Manufacturing 110,413 117,647 18.7 % 112,644 118,440 19.2 % Other 108,051 117,823 18.7 % 92,256 97,602 15.8 % Total $ 599,602 $ 630,455 100.0 % $ 600,458 $ 617,039 100.0 % Other-Than-Temporary Impairments - Fixed Maturity and Equity Securities A portion of certain other-than-temporary impairment (“OTTI”) losses on fixed maturity securities is recognized in AOCI. For these securities the net amount recognized in the consolidated statements of operations (“credit loss impairments”) represents the difference between the amortized cost of the security and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the debt security prior to impairment. Any remaining difference between the fair value and amortized cost is recognized in AOCI. The Company recorded a $3.3 million and a $1.0 million impairment, within Other income (expense), net , during the three months ended March 31, 2017 and 2016 , respectively, related to one fixed maturity security. Unrealized Losses for Fixed Maturity and Equity Securities Available-for-Sale The following table presents the total unrealized losses for the 217 and 269 fixed maturity and equity securities held by the Company as of March 31, 2017 and December 31, 2016 , respectively, where the estimated fair value had declined and remained below amortized cost by the indicated amount (in thousands): March 31, 2017 December 31, 2016 Unrealized Losses % of Total Unrealized Losses % of Fixed maturity and equity securities Less than 20% $ (8,016 ) 67.7 % $ (10,069 ) 69.0 % 20% or more for less than six months (2,825 ) 23.9 % (482 ) 3.3 % 20% or more for six months or greater (1,000 ) 8.4 % (4,032 ) 27.7 % Total $ (11,841 ) 100.0 % $ (14,583 ) 100.0 % The determination of whether unrealized losses are “other-than-temporary” requires judgment based on subjective as well as objective factors. Factors considered and resources used by management include (i) whether the unrealized loss is credit-driven or a result of changes in market interest rates, (ii) the extent to which fair value is less than cost basis, (iii) cash flow projections received from independent sources, (iv) historical operating, balance sheet and cash flow data contained in issuer SEC filings and news releases, (v) near-term prospects for improvement in the issuer and/or its industry, (vi) third party research and communications with industry specialists, (vii) financial models and forecasts, (viii) the continuity of dividend payments, maintenance of investment grade ratings and hybrid nature of certain investments, (ix) discussions with issuer management, and (x) ability and intent to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value. The Company analyzes its MBS for other-than-temporary impairment each quarter based upon expected future cash flows. Management estimates expected future cash flows based upon its knowledge of the MBS market, cash flow projections (which reflect loan-to-collateral values, subordination, vintage and geographic concentration) received from independent sources, implied cash flows inherent in security ratings and analysis of historical payment data. The Company believes it will recover its cost basis in the non-impaired securities with unrealized losses and that the Company has the ability to hold the securities until they recover in value. The Company neither intends to sell nor does it expect to be required to sell the securities with unrealized losses as of March 31, 2017 . However, unforeseen facts and circumstances may cause the Company to sell fixed maturity and equity securities in the ordinary course of managing its portfolio to meet certain diversification, credit quality and liquidity guidelines. The following tables present the estimated fair values and gross unrealized losses for the 217 and 269 fixed maturity and equity securities held by the Company that have estimated fair values below amortized cost as of each of March 31, 2017 and December 31, 2016 , respectively. The Company does not have any OTTI losses reported in AOCI. These investments are presented by investment category and the length of time the related fair value has remained below amortized cost (in thousands): March 31, 2017 Less than 12 months 12 months of greater Total Fair Value Unrealized Losses Fair Unrealized Losses Fair Unrealized Losses Fixed maturity securities U.S. Government and government agencies $ 5,833 $ (64 ) $ — $ — $ 5,833 $ (64 ) States, municipalities and political subdivisions 114,135 (2,928 ) 365 (16 ) 114,500 (2,944 ) Foreign government — — 5,871 (497 ) 5,871 (497 ) Residential mortgage-backed securities 35,648 (2,105 ) 17,519 (393 ) 53,167 (2,498 ) Commercial mortgage-backed securities 12,129 (56 ) 2,181 (117 ) 14,310 (173 ) Asset-backed securities 46,595 (442 ) 11,924 (474 ) 58,519 (916 ) Corporate and other 85,891 (2,017 ) 3,370 (54 ) 89,261 (2,071 ) Total fixed maturity securities $ 300,231 $ (7,612 ) $ 41,230 $ (1,551 ) $ 341,461 $ (9,163 ) Equity securities Common stocks $ 12,811 $ (2,167 ) $ 518 $ (460 ) $ 13,329 $ (2,627 ) Perpetual preferred stocks 4,251 (51 ) — — 4,251 (51 ) Total equity securities $ 17,062 $ (2,218 ) $ 518 $ (460 ) $ 17,580 $ (2,678 ) December 31, 2016 Less than 12 months 12 months of greater Total Fair Unrealized Losses Fair Unrealized Losses Fair Unrealized Losses Fixed maturity securities U.S. Government and government agencies $ 4,392 $ (95 ) $ — $ — $ 4,392 $ (95 ) States, municipalities and political subdivisions 207,740 (3,858 ) — — 207,740 (3,858 ) Foreign government 5,978 (402 ) — — 5,978 (402 ) Residential mortgage-backed securities 54,385 (564 ) — — 54,385 (564 ) Commercial mortgage-backed securities 13,159 (89 ) — — 13,159 (89 ) Asset-backed securities 12,443 (572 ) — — 12,443 (572 ) Corporate and other 147,653 (3,022 ) 3,579 (4,032 ) 151,232 (7,054 ) Total fixed maturity securities $ 445,750 $ (8,602 ) $ 3,579 $ (4,032 ) $ 449,329 $ (12,634 ) Equity securities Common stocks $ 14,585 $ (1,371 ) $ — $ — $ 14,585 $ (1,371 ) Perpetual preferred stocks 20,464 (578 ) — — 20,464 (578 ) Total equity securities $ 35,049 $ (1,949 ) $ — $ — $ 35,049 $ (1,949 ) As of March 31, 2017 , investment grade fixed maturity securities (as determined by nationally recognized rating agencies) represented approximately 90.4% of the gross unrealized loss and 95.9% of the fair value. As of December 31, 2016 , investment grade fixed maturity securities represented approximately 54.5% of the gross unrealized loss and 83.0% of the fair value. Certain risks are inherent in connection with fixed maturity securities, including loss upon default, price volatility in reaction to changes in interest rates, and general market factors and risks associated with reinvestment of proceeds due to prepayments or redemptions in a period of declining interest rates. Other Invested Assets Carrying values of other invested assets accounted for under cost and equity method are as follows (in thousands): March 31, 2017 December 31, 2016 Cost Equity Method Fair Value Cost Equity Method Fair Common Equity $ 138 $ 1,083 $ — $ 138 $ 1,047 $ — Preferred Equity 2,484 19,044 — 2,484 9,971 — Derivatives 3,097 — 3,694 3,097 — 3,813 Limited Partnerships — 1,007 — — 1,116 — Joint Ventures — 50,033 — — 40,697 — Total $ 5,719 $ 71,167 $ 3,694 $ 5,719 $ 52,831 $ 3,813 The Company recognized losses of $0.1 million and $0.7 million on declines in the fair value of derivatives accounted for under ASC 815, "Derivatives and Hedging" during the three months ended March 31, 2017 and 2016 , respectively. Summarized information for the Company's equity method investments as of and for the three months ended March 31, 2017 is as follows (information for two of the investees is reported on a one month lag, in thousands): Net revenue $ 120,862 Gross profit $ 38,258 Income (loss) from continuing operations $ (9,243 ) Net income (loss) $ (16,292 ) Current assets $ 297,687 Noncurrent assets $ 282,415 Current liabilities $ 193,848 Noncurrent liabilities $ 137,345 Net Investment Income The major sources of net investment income were as follows (in thousands): Three Months Ended March 31, 2017 2016 Fixed maturity securities, available-for-sale at fair value $ 13,925 $ 13,266 Equity securities, available-for-sale at fair value 675 572 Mortgage loans 464 17 Policy loans 298 297 Other invested assets 4 142 Gross investment income 15,366 14,294 External investment expense (62 ) (215 ) Net investment income $ 15,304 $ 14,079 Net Realized Gains (Losses) on Investments The major sources of net realized gains (losses) on investments were as follows (in thousands): Three Months Ended March 31, 2017 2016 Realized gains on fixed maturity securities $ 961 $ 321 Realized losses on fixed maturity securities (455 ) (2,309 ) Realized gains on equity securities — 88 Realized losses on equity securities — (352 ) Net realized gains (losses) on derivative instruments 275 (2,623 ) Net realized gains (losses) $ 781 $ (4,875 ) |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 5. Fair Value of Financial Instruments Assets by Hierarchy Level Assets and liabilities measured at fair value on a recurring basis are summarized below (in thousands): March 31, 2017 Fair Value Measurement Using: Total Level 1 Level 2 Level 3 Assets Fixed maturity securities U.S. Government and government agencies $ 15,854 $ 5,134 $ 10,705 $ 15 States, municipalities and political subdivisions 380,710 — 374,112 6,598 Foreign government 5,871 — 5,871 — Residential mortgage-backed securities 132,257 — 78,520 53,737 Commercial mortgage-backed securities 40,895 — 4,922 35,973 Asset-backed securities 96,507 — 9,347 87,160 Corporate and other 630,455 2,131 601,604 26,720 Total fixed maturity securities 1,302,549 7,265 1,085,081 210,203 Equity securities Common stocks 14,214 10,683 — 3,531 Perpetual preferred stocks 37,683 9,676 28,007 — Total equity securities 51,897 20,359 28,007 3,531 Derivatives 3,694 — — 3,694 Total assets accounted for at fair value $ 1,358,140 $ 27,624 $ 1,113,088 $ 217,428 Liabilities Warrant liability $ 4,223 $ — $ — $ 4,223 Contingent liability 11,642 — — 11,642 Other 675 — — 675 Total liabilities accounted for at fair value $ 16,540 $ — $ — $ 16,540 December 31, 2016 Fair Value Measurement Using: Total Level 1 Level 2 Level 3 Assets Fixed maturity securities U.S. Government and government agencies $ 15,950 $ 5,140 $ 10,778 $ 32 States, municipalities and political subdivisions 375,077 — 369,387 5,690 Foreign government 5,978 — 5,978 — Residential mortgage-backed securities 138,196 — 82,242 55,954 Commercial mortgage-backed securities 49,053 — 6,035 43,018 Asset-backed securities 77,665 — 4,448 73,217 Corporate and other 617,039 2,020 594,653 20,366 Total fixed maturity securities 1,278,958 7,160 1,073,521 198,277 Equity securities Common stocks 14,865 10,290 — 4,575 Perpetual preferred stocks 36,654 9,312 27,342 — Total equity securities 51,519 19,602 27,342 4,575 Derivatives 3,813 — — 3,813 Total assets accounted for at fair value $ 1,334,290 $ 26,762 $ 1,100,863 $ 206,665 Liabilities Warrant liability $ 4,058 $ — $ — $ 4,058 Contingent liability 11,411 — — 11,411 Other 816 — — 816 Total liabilities accounted for at fair value $ 16,285 $ — $ — $ 16,285 The Company reviews the fair value hierarchy classifications each reporting period. Changes in the observability of the valuation attributes may result in a reclassification of certain financial assets or liabilities. Such reclassifications are reported as transfers in and out of Level 3, or between other levels, at the beginning fair value for the reporting period in which the changes occur. There were no transfers between Level 1 and Level 2 during the three months ended March 31, 2017 and $1.1 million corporate and other bonds and $0.5 million preferred stock were transferred from Level 1 into Level 2 during the three months ended March 31, 2016 , reflecting the level of market activity in these instruments. Availability of secondary market activity and consistency of pricing from third-party sources impacts the Company's ability to classify securities as Level 2 or Level 3. The Company’s assessment resulted in no transfers from or into Level 3 during the three months ended March 31, 2017 and net transfers into Level 3 of $2.2 million during the three months ended March 31, 2016 . The methods and assumptions the Company uses to estimate the fair value of assets and liabilities measured at fair value on a recurring basis are summarized below: Fixed Maturity Securities - The fair values of the Company’s publicly-traded fixed maturity securities are generally based on prices obtained from independent pricing services. Prices from pricing services are sourced from multiple vendors, and a vendor hierarchy is maintained by asset type based on historical pricing experience and vendor expertise. In some cases, the Company receives prices from multiple pricing services for each security, but ultimately uses the price from the pricing service highest in the vendor hierarchy based on the respective asset type. Consistent with the fair value hierarchy described above, securities with validated quotes from pricing services are generally reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. If the Company ultimately concludes that pricing information received from the independent pricing service is not reflective of market activity, non-binding broker quotes are used, if available. If the Company concludes the values from both pricing services and brokers are not reflective of market activity, it may override the information from the pricing service or broker with an internally developed valuation, however, this occurs infrequently. Internally developed valuations or non-binding broker quotes are also used to determine fair value in circumstances where vendor pricing is not available. These estimates may use significant unobservable inputs, which reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset. Pricing service overrides, internally developed valuations and non-binding broker quotes are generally based on significant unobservable inputs and are reflected as Level 3 in the valuation hierarchy. The inputs used in the valuation of corporate and government securities include, but are not limited to, standard market observable inputs which are derived from, or corroborated by, market observable data including market yield curve, duration, call provisions, observable prices and spreads for similar publicly traded or privately traded issues that incorporate the credit quality and industry sector of the issuer. For structured securities, valuation is based primarily on matrix pricing or other similar techniques using standard market inputs including spreads for actively traded securities, spreads off benchmark yields, expected prepayment speeds and volumes, current and forecasted loss severity, rating, weighted average coupon, weighted average maturity, average delinquency rates, geographic region, debt-service coverage ratios and issuance-specific information including, but not limited to: collateral type, payment terms of the underlying assets, payment priority within the tranche, structure of the security, deal performance and vintage of loans. When observable inputs are not available, the market standard valuation techniques for determining the estimated fair value of certain types of securities that trade infrequently, and therefore have little or no price transparency, rely on inputs that are significant to the estimated fair value but that are not observable in the market or cannot be derived principally from or corroborated by observable market data. These unobservable inputs are sometimes based in large part on management judgment or estimation, and cannot be supported by reference to market activity. Even though unobservable, these inputs are based on assumptions deemed appropriate given the circumstances and are believed to be consistent with what other market participants would use when pricing such securities. The fair values of private placement securities are primarily determined using a discounted cash flow model. In certain cases these models primarily use observable inputs with a discount rate based upon the average of spread surveys collected from private market intermediaries who are active in both primary and secondary transactions, taking into account, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Generally, these securities have been reflected within Level 3. For certain private fixed maturities, the discounted cash flow model may also incorporate significant unobservable inputs, which reflect the Company’s own assumptions about the inputs market participants would use in pricing the security. To the extent management determines that such unobservable inputs are not significant to the price of a security, a Level 2 classification is made. Otherwise, a Level 3 classification is used. Equity Securities. The balance consists principally of common and preferred stock of publicly and privately traded companies. The fair values of publicly traded equity securities are primarily based on quoted market prices in active markets and are classified within Level 1 in the fair value hierarchy. The fair values of preferred equity securities, for which quoted market prices are not readily available, are based on prices obtained from independent pricing services and these securities are generally classified within Level 2 in the fair value hierarchy. The fair value of common stock of privately held companies was determined using unobservable market inputs, including volatility and underlying security values and was classified as Level 3. Cash Equivalents. The balance consists of money market instruments, which are generally valued using unadjusted quoted prices in active markets that are accessible for identical assets and are primarily classified as Level 1. Various time deposits carried as cash equivalents are not measured at estimated fair value and therefore are excluded from the tables presented. Derivatives. The balance consists of common stock purchase warrants and call options. The fair values of the call options are primarily based on quoted market prices in active markets and are classified within Level 1 in the fair value hierarchy. Depending on the terms, the common stock warrants were valued using either Black-Scholes analysis or Monte Carlo Simulation. Fair value was determined using unobservable market inputs, including volatility and underlying security values, therefore the common stock purchase warrants were classified as Level 3. Warrant Liability. The balance represents warrants issued in connection with the acquisition of the Insurance business and recorded within other liabilities on the Consolidated Balance Sheets. Fair value was determined using the Monte Carlo Simulation because the adjustments for exercise price and warrant shares represent path dependent features; the exercise price from prior periods needs to be known to determine whether a subsequent sale of shares occurs at a price that is lower than the then current exercise price. The analysis entails a Geometric Brownian Motion based simulation of 100 unique price paths of the Company's stock for each combination of assumptions. Fair value was determined using unobservable market inputs, including volatility, and a range of assumptions regarding a possibility of an equity capital raise each year and the expected size of future equity capital raises. The present value of a given simulated scenario was based on intrinsic value at expiration discounted to the valuation date, taking into account any adjustments to the exercise price or warrant shares issuable. The average present value across all 100 independent price paths represents the estimate of fair value for each combination of assumptions. Therefore, the warrant liability was classified as Level 3. Contingent Liability. The balance represents the present value of the estimated obligation pursuant to the acquisition of the Insurance business. Fair value was determined using unobservable market inputs, including probability of rate increases as approved by state regulators. The liability was classified as Level 3. Level 3 Measurements and Transfers The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the three months ended March 31, 2017 and 2016 (in thousands): Total realized/unrealized gains (losses) included in Balance at December 31, 2016 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2017 Assets Fixed maturity securities U.S. Government and government agencies $ 32 $ — $ — $ — $ (17 ) $ — $ — $ 15 States, municipalities and political subdivisions 5,690 111 797 — — — — 6,598 Residential mortgage-backed securities 55,954 (595 ) 889 48 (2,559 ) — — 53,737 Commercial mortgage-backed securities 43,018 234 (17 ) — (7,262 ) — — 35,973 Asset-backed securities 73,217 1,074 (1,684 ) 27,725 (13,172 ) — — 87,160 Corporate and other 20,366 (3,267 ) 6,641 3,000 (20 ) — — 26,720 Total fixed maturity securities 198,277 (2,443 ) 6,626 30,773 (23,030 ) — — 210,203 Equity securities Common stocks 4,575 — (1,044 ) — — — — 3,531 Total equity securities 4,575 — (1,044 ) — — — — 3,531 Derivatives 3,813 (119 ) — — — — — 3,694 Total financial assets $ 206,665 $ (2,562 ) $ 5,582 $ 30,773 $ (23,030 ) $ — $ — $ 217,428 Total realized/unrealized (gains) losses included in Balance at December 31, 2016 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2017 Liabilities Warrant liability $ 4,058 $ 165 $ — $ — $ — $ — $ — $ 4,223 Contingent liability 11,411 231 — — — — — 11,642 Other 816 (141 ) — — — — — 675 Total financial liabilities $ 16,285 $ 255 $ — $ — $ — $ — $ — $ 16,540 Total realized/unrealized gains (losses) included in Balance at December 31, 2015 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2016 Assets Fixed maturity securities U.S. Government and government agencies $ 73 $ — $ (3 ) $ — $ (17 ) $ — $ — $ 53 States, municipalities and political subdivisions 5,659 99 3 — — — — 5,761 Residential mortgage-backed securities 79,019 (1,139 ) (156 ) — (3,354 ) 6,387 (5,557 ) 75,200 Commercial mortgage-backed securities 60,525 (291 ) 632 — (3,814 ) 385 (2,832 ) 54,605 Asset-backed securities 27,653 32 (420 ) 14,660 (300 ) 4,911 (1,133 ) 45,403 Corporate and other 13,944 (18 ) (1,395 ) — (45 ) — — 12,486 Total fixed maturity securities 186,873 (1,317 ) (1,339 ) 14,660 (7,530 ) 11,683 (9,522 ) 193,508 Equity securities Common stocks 4,932 — (356 ) — — — — 4,576 Total equity securities 4,932 — (356 ) — — — — 4,576 Derivatives 4,211 — — (1,124 ) — — — 3,087 Contingent asset — — — 2,992 — — — 2,992 Total financial assets $ 196,016 $ (1,317 ) $ (1,695 ) $ 16,528 $ (7,530 ) $ 11,683 $ (9,522 ) $ 204,163 Total realized/unrealized gains (losses) included in Balance at December 31, 2015 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2016 Liabilities Derivatives $ 4,332 $ (1,974 ) $ — $ — $ — $ — $ — $ 2,358 Contingent liability — — — 2,589 — — — 2,589 Total financial liabilities $ 4,332 $ (1,974 ) $ — $ 2,589 $ — $ — $ — $ 4,947 Internally developed fair values of Level 3 assets represent less than 1% of the Company’s total assets, any justifiable changes in unobservable inputs used to determine internally developed fair values would not have a material impact on the Company’s financial position. Fair Value of Financial Instruments Not Measured at Fair Value The Company is required by general accounting principles for Fair Value Measurements and Disclosures to disclose the fair value of certain financial instruments including those that are not carried at fair value. The following table presents the carrying amounts and estimated fair values of the Company’s financial instruments, which were not measured at fair value on a recurring basis. The table excludes carrying amounts reported in the Consolidated Balance Sheets for cash, accounts receivable, costs and recognized earnings in excess of billings, accounts payable, accrued expenses, billings in excess of costs and recognized earnings, and other current assets and liabilities approximate fair value due to relatively short periods to maturity (in thousands): March 31, 2017 Fair Value Measurement Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Assets Mortgage loans $ 21,824 $ 21,825 $ — $ — $ 21,825 Policy loans 18,106 18,106 — 18,106 — Other invested assets 5,719 4,256 — — 4,256 Total assets not accounted for at fair value $ 45,649 $ 44,187 $ — $ 18,106 $ 26,081 Liabilities Annuity benefits accumulated (1) $ 249,276 $ 246,601 $ — $ — $ 246,601 Long-term obligations (2) 395,576 403,533 — 403,533 — Total liabilities not accounted for at fair value $ 644,852 $ 650,134 $ — $ 403,533 $ 246,601 December 31, 2016 Fair Value Measurement Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Assets Mortgage loans $ 16,831 $ 16,832 $ — $ — $ 16,832 Policy loans 18,247 18,247 — 18,247 — Other invested assets 5,719 4,597 — — 4,597 Total assets not accounted for at fair value $ 40,797 $ 39,676 $ — $ 18,247 $ 21,429 Liabilities Annuity benefits accumulated (1) $ 251,270 $ 249,372 $ — $ — $ 249,372 Long-term obligations (2) 378,780 376,081 — 376,081 — Total liabilities not accounted for at fair value $ 630,050 $ 625,453 $ — $ 376,081 $ 249,372 (1) Excludes life contingent annuities in the payout phase. (2) Excludes certain lease obligations accounted for under ASC 840, "Leases". Mortgage Loans on Real Estate. The fair value of mortgage loans on real estate is estimated by discounting cash flows, both principal and interest, using current interest rates for mortgage loans with similar credit ratings and similar remaining maturities. As such, inputs include current treasury yields and spreads, which are based on the credit rating and average life of the loan, corresponding to the market spreads. The valuation of mortgage loans on real estate is considered Level 3 in the fair value hierarchy. Policy Loans. The policy loans are reported at the unpaid principal balance and carry a fixed interest rate. The Company determined that the carrying value approximates fair value because (i) policy loans present no credit risk as the amount of the loan cannot exceed the obligation due upon the death of the insured or surrender of the underlying policy; (ii) there is no active market for policy loans (i.e., there is no commonly available exit price to determine the fair value of policy loans in the open market); (iii) policy loans are intricately linked to the underlying policy liability and, in many cases, policy loan balances are recovered through offsetting the loan balance against the benefits paid under the policy; and (iv) policy loans can be repaid by policyholders at any time, and this prepayment uncertainty reduces the potential impact of a difference between amortized cost (carrying value) and fair value. The valuation of policy loans is considered Level 2 in the fair value hierarchy. Other Invested Assets. The balance primarily includes common stock purchase warrants. The fair values were derived using Black-Scholes analysis using unobservable market inputs, including volatility and underlying security values; therefore, the common stock purchase warrants were classified as Level 3. Annuity Benefits Accumulated. The fair value of annuity benefits was determined using the surrender values of the annuities and classified as Level 3. Long-term Obligations. The fair value of the Company’s long-term obligations was determined using Bloomberg Valuation Service BVAL. The methodology combines direct market observations from contributed sources with quantitative pricing models to generate evaluated prices and classified as Level 2. |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | 6. Accounts Receivable Accounts receivable consist of the following (in thousands): March 31, 2017 December 31, 2016 Contracts in progress $ 120,488 $ 121,666 Unbilled retentions 33,475 35,069 Trade receivables 75,963 113,380 Other receivables 1,340 1,102 Allowance for doubtful accounts (3,208 ) (3,619 ) Total accounts receivable $ 228,058 $ 267,598 |
Recoverable from Reinsurers
Recoverable from Reinsurers | 3 Months Ended |
Mar. 31, 2017 | |
Insurance [Abstract] | |
Recoverable from Reinsurers | 7. Recoverable from Reinsurers The following table presents information for the Company's recoverable from reinsurers assets (in thousands): March 31, 2017 December 31, 2016 Reinsurer A.M. Best Rating Amount % of Total Amount % of Total Loyal American Life Insurance Co (Cigna) A- $ 142,514 27.2 % $ 139,269 26.5 % Great American Life Insurance Co A 47,917 9.1 % 46,965 9.0 % Hannover Life Reassurance Co A+ 334,414 63.7 % 337,967 64.5 % Total $ 524,845 100.0 % $ 524,201 100.0 % |
Property, Plant and Equipment,
Property, Plant and Equipment, net | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment, net | 8. Property, Plant and Equipment, net Property, plant and equipment consist of the following (in thousands): March 31, 2017 December 31, 2016 Land $ 21,029 $ 21,006 Building and leasehold improvements 31,560 31,713 Plant and transportation equipment 5,302 5,551 Cable-ships and submersibles 164,660 169,034 Equipment, furniture and fixtures, and software 104,245 101,421 Construction in progress 22,633 19,889 349,429 348,614 Less: Accumulated depreciation 65,125 62,156 $ 284,304 $ 286,458 Depreciation expense was $8.3 million and $ 7.6 million for the three months ended March 31, 2017 and 2016 , respectively. These amounts included $1.2 million and $ 1.9 million of depreciation expense within cost of revenue for the three months ended March 31, 2017 and 2016 , respectively. As of March 31, 2017 and December 31, 2016 , total net book value of equipment under capital leases consisted of $49.5 million and $51.0 million of cable-ships and submersibles, respectively. |
Goodwill and Intangibles, net
Goodwill and Intangibles, net | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles, net | 9. Goodwill and Intangibles, net Goodwill The changes in the carrying amount of goodwill by reporting unit are as follows (in thousands): Construction Marine Services Energy Telecom Insurance Life Sciences Other Total Balance at December 31, 2016 and March 31, 2017 $ 36,317 $ 2,468 $ 2,631 $ 3,378 $ 47,290 $ 3,620 $ 2,382 $ 98,086 Indefinite-lived Intangible Assets The acquisition of the Insurance Company resulted in state licenses which are considered indefinite-lived intangible assets not subject to amortization of $2.5 million as of March 31, 2017 . In addition, the consolidation of BeneVir in 2016 resulted in the recording of an in-process research and development intangible asset not subject to amortization of $6.4 million as of March 31, 2017 . Definite Lived Intangible Assets The changes in the carrying amount of amortizable intangible assets by reporting unit are as follows (in thousands): Construction Marine Services Energy Life Sciences Other Corporate Total Trade names Balance at December 31, 2016 $ 4,216 $ 898 $ 4,777 $ — $ — $ — $ 9,891 Periodic Amortization (119 ) (93 ) (320 ) — — — (532 ) Balance at March 31, 2017 4,097 805 4,457 — — — 9,359 Customer relationships Balance at December 31, 2016 3,438 6,344 8,889 — — — 18,671 Periodic Amortization (353 ) (108 ) (68 ) — — — (529 ) Balance at March 31, 2017 3,085 6,236 8,821 — — — 18,142 Developed technology Balance at December 31, 2016 — 539 — — 1,003 — 1,542 Periodic Amortization — (65 ) — — (251 ) — (316 ) Balance at March 31, 2017 — 474 — — 752 — 1,226 Other Balance at December 31, 2016 447 — 91 220 — 18 776 Acquisitions — — 8 99 — — 107 Periodic Amortization (68 ) — — (1 ) — (1 ) (70 ) Balance at March 31, 2017 379 — 99 318 — 17 813 Total Amortizable Intangible Assets Balance at December 31, 2016 8,101 7,781 13,757 220 1,003 18 30,880 Acquisitions — — 8 99 — — 107 Periodic Amortization (540 ) (266 ) (388 ) (1 ) (251 ) (1 ) (1,447 ) Balance at March 31, 2017 $ 7,561 $ 7,515 $ 13,377 $ 318 $ 752 $ 17 $ 29,540 An interim goodwill impairment test was performed on each reporting units. On a quarterly basis, the Company performs a step 0 analysis. After considering all quantitative and qualitative factors above, the Company has determined that it is more likely than not that the reporting units' fair values exceed carrying values as of the period end, and as such, a more formal “two step” goodwill impairment analysis is not necessary. |
Life, Accident and Health Reser
Life, Accident and Health Reserves | 3 Months Ended |
Mar. 31, 2017 | |
Insurance [Abstract] | |
Life, Accident and Health Reserves | 10. Life, Accident and Health Reserves Life, accident and health reserves consist of the following (in thousands): March 31, 2017 December 31, 2016 Long-term care insurance reserves $ 1,422,306 $ 1,407,848 Traditional life insurance reserves 101,870 102,077 Other accident and health insurance reserves 141,283 138,640 Total life, accident and health reserves $ 1,665,459 $ 1,648,565 The following table sets forth changes in the liability for claims for the portion of our long-term care insurance reserves in scope of the ASU 2015-09 disclosure requirements (in thousands): Three Months Ended March 31, 2017 2016 Beginning balance $ 226,970 $ 208,150 Less: recoverable from reinsurers (97,858 ) (94,041 ) Beginning balance, net 129,112 114,109 Incurred related to insured events of: Current year 17,641 11,482 Prior years (3,678 ) 672 Total incurred 13,963 12,154 Paid related to insured events of: Current year (557 ) (485 ) Prior years (10,660 ) (9,647 ) Total paid (11,217 ) (10,132 ) Interest on liability for policy and contract claims 1,178 1,054 Ending balance, net 133,036 117,185 Add: recoverable from reinsurers 95,091 96,088 Ending balance $ 228,127 $ 213,273 For the three months ended March 31, 2017 the reserve was sufficient by $3.7 million while for the same period last year, the reserve exhibited a deficiency of $0.7 million . The reserve sufficiency is being driven by claim terminations as the result of policyholder deaths that released significant reserves which is attributable to the normal volatility in the reserves, due to the number of claims that are currently open. |
Accounts Payable and Other Curr
Accounts Payable and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Other Current Liabilities | 11. Accounts Payable and Other Current Liabilities Accounts payable and other current liabilities consist of the following (in thousands): March 31, 2017 December 31, 2016 Accounts payable $ 60,477 $ 66,792 Accrued interconnection costs 61,551 93,661 Accrued payroll and employee benefits 23,358 28,668 Accrued interest 13,334 3,056 Accrued income taxes 13,757 3,983 Accrued expenses and other current liabilities 63,680 55,573 Total accounts payable and other current liabilities $ 236,157 $ 251,733 |
Long-term Obligations
Long-term Obligations | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Obligations | 12. Long-term Obligations Long-term debt consists of the following (in thousands): March 31, 2017 December 31, 2016 HC2 11.0% Senior Secured Notes, due in 2019 $ 362,000 $ 307,000 HC22 11.0% Senior Secured Bridge Note, due in 2019 (the "11.0% Bridge Notes") — 35,000 GMSL Notes payable and revolving lines of credit, various maturity dates 16,957 17,522 LIBOR plus 3.65% Notes, due in 2019 — 3,026 Obligations under capital leases 50,044 49,717 DBMG LIBOR plus 4.0% Notes, due in 2018 and 2019 8,764 9,439 LIBOR plus 3.0% Line of Credit — — ANG 5.5% Term Loan, due in 2018 460 501 4.5% Note due in 2022 (1) 13,172 13,343 4.25% Seller Note, due in 2022 2,714 2,796 Other 158 75 Total 454,269 438,419 Issuance discount or premium and deferred financing costs, net (8,649 ) (9,923 ) Total long-term obligations $ 445,620 $ 428,496 (1) ANG refinanced and consolidated all three of its loans with Pioneer during the first quarter of 2017. HC2 and HC22 11.0% Senior Secured Notes In January 2017, the Company issued and additional $55.0 million in aggregate principal amount of its 11.0% Senior Secured Notes due 2019 (the “ 11.0% Notes”). HC2 used a portion of the proceeds from the issuance to repay all $35.0 million in outstanding aggregate principal amount of HC22's 11.0% Bridge Notes. The Company has issued an aggregate of $362.0 million of its 11.0% Notes pursuant to an indenture dated November 20, 2014, by and among HC2, the guarantors party thereto and U.S. Bank National Association, a national banking association, as trustee (the “ 11.0% Notes Indenture”). The 11.0% Notes Indenture contains certain covenants limiting, among other things, the ability of the Company and certain subsidiaries of the Company to incur additional indebtedness; create liens; engage in sale-leaseback transactions; pay dividends or make distributions in respect of capital stock and make certain restricted payments; sell assets; engage in transactions with affiliates; or consolidate or merge with, or sell substantially all of its assets to, another person. The 11.0% Notes Indenture also includes two maintenance covenants: (1) a liquidity covenant; and (2) a collateral coverage covenant. The 11.0% Notes Indenture contains customary events of default. For additional information the 11.0% Notes and 11.0% Notes Indenture please see our Annual Report on Form 10-K for the year ended December 31, 2016. DBMG Credit Facilities DBMG has a Credit and Security Agreement ("DBMG Facility") with Wells Fargo Credit, Inc. ("Wells Fargo"), pursuant to which Wells Fargo agreed to advance up to a maximum amount of $50 million to DBMG, including up to $14.5 million of letters of credit. The DBMG Facility has a floating interest rate of LIBOR plus 3.0% , requires monthly interest payments, and matures in 2019. The DBMG Facility is secured by a first priority, perfected security interest in all of DBMG’s and its present and future subsidiaries' assets, excluding real estate, and a second priority, perfected security interest in all of DBMG’s real estate. The security agreements pursuant to which DBMG’s assets are pledged prohibit any further pledge of such assets without the written consent of the bank. The DBMG Facility contains various restrictive covenants. At March 31, 2017 , DBMG was in compliance with these covenants. In February 2017 DBMG increased the amount of letters of credit under the DBMG Facility to support increased bonding requirements for anticipated larger projects that will be part of this year's backlog. Under the DBMG Facility as of March 31, 2017 DBMG had $9.0 million in outstanding letters of credit issued, of which $0 has been drawn. On May 6, 2014, DBMG entered into an amendment to the DBMG Facility, pursuant to which Wells Fargo extended the maturity date of the DBMG Facility to April 30, 2019, lowered the interest rate charged in connection with borrowings under the DBMG Facility and allowed for the issuance of additional loans in the form of notes totaling up to $5.0 million , secured by its real estate as a separate tranche under the DBMG Facility (“Real Estate Term Advance”). At March 31, 2017 , DBMG had borrowed $3.2 million under the Real Estate Term Advance. The Real Estate Term Advance has a five year amortization period requiring monthly principal payments and a final balloon payment at maturity. The Real Estate Term Advance has a floating interest rate of LIBOR plus 4.0% and requires monthly interest payments. The DBMG Facility allows for the issuance by DBMG of additional loans in the form of notes of up to $10.0 million , secured by its machinery and equipment (“Real Estate Term Advance (M&E)”) and the issuance of a note payable of up to $5.0 million , secured by its real estate (“Real Estate Term Advance (Working Capital)”), each as separate tranches of debt under the DBMG Facility. At March 31, 2017 there was $5.5 million outstanding under the Real Estate Term Advance (M&E) and no borrowings outstanding under the Real Estate Term Advance (Working Capital). GMSL Capital Leases GMSL is a party to two leases to finance the use of two vessels: the Innovator (the “Innovator Lease”) and the Cable Retriever (the “Cable Lease,” and together with the Innovator Lease, the “GMSL Leases”). The Innovator Lease was restructured effective May 31, 2016, extending the lease to 2025. The principal amount thereunder bears interest at the rate of approximately 10.4% . The Cable Lease expires in 2023 . The principal amount thereunder bears interest at the rate of approximately 4.0% . As of March 31, 2017 , $50.0 million in aggregate principal amount remained outstanding under the GMSL Leases. ANG Term Loan In January 2017, ANG refinanced and consolidated all three of its loans with Pioneer. The $13.2 million in aggregate principal balance outstanding shall bear fixed interest annually equal to 4.5% , due in 2022. For additional information on the Company’s long-term, see Note 13. Long-term Obligations in the Company’s Annual Report on Form 10-K for the year ended December 31, 2016. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes Income Tax (Expense) Benefit The Company used the Annual Effective Tax Rate (“ETR”) approach of ASC 740-270, "Interim Reporting," to calculate its 2017 interim tax provision. Income tax was an expense of $5.3 million and a benefit of $2.5 million for the three months ended March 31, 2017 and 2016 , respectively. The income tax expense recorded for March 31, 2017 relates to the reversal of taxable temporary differences at the Insurance segment for which no deferred tax benefit is recognized due to a full valuation allowance on the Insurance segment’s net deferred tax assets and to the projected expense as calculated under ASC 740 for other taxpaying entities. Additionally, the tax benefits associated with losses generated by the HC2 Holdings, Inc. U.S. consolidated income tax return and certain other businesses have been reduced by a full valuation allowance as we do not believe it is more-likely-than-not that the losses will be utilized prior to expiration. The income tax benefit recorded for March 31, 2016 relates to losses generated for which we expected to obtain benefits from in the future based on our weighting of all positive and negative evidence that existed at the time. This benefit was partially offset by a valuation allowance recorded against the deferred tax assets of the Insurance segment during the first quarter of 2016. NOL Limitation As of December 31, 2016, the Company has a U.S. net operating loss carryforward available to reduce future taxable income in the amount of $95.3 million , of which $77.8 million is subject to an annual limitation under Section 382 of the Internal Revenue Code. Additionally, the Company has $21.6 million of U.S. net operating loss carryforwards from its subsidiaries that do not qualify to be included in the HC2 Holdings, Inc. U.S. consolidated income tax return. Unrecognized Tax Benefits The Company follows the provision of ASC 740-10, “Income Taxes”, which prescribes a comprehensive model for how a company should recognize, measure, present, and disclose in its financial statements uncertain tax positions that the Company has taken or expects to take on a tax return. The Company is subject to challenge from various taxing authorities relative to certain tax planning strategies, including certain intercompany transactions as well as regulatory taxes. Examinations The Company conducts business globally, and as a result, the Company or one or more of its subsidiaries files income tax returns in the United States federal jurisdiction and various state and foreign jurisdictions. In the normal course of business the Company is subject to examination by taxing authorities throughout the world. The open tax years contain matters that could be subject to differing interpretations of applicable tax laws and regulations as they relate to the amount, character, timing or inclusion of revenue and expenses or the applicability of income tax credits for the relevant tax period. Given the nature of tax audits there is a risk that disputes may arise. Tax years 2006 - 2016 remain open for examination. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14. Commitments and Contingencies Litigation The Company is subject to claims and legal proceedings that arise in the ordinary course of business. Such matters are inherently uncertain, and there can be no guarantee that the outcome of any such matter will be decided favorably to the Company or that the resolution of any such matter will not have a material adverse effect upon the Company’s Consolidated Financial Statements. The Company does not believe that any of such pending claims and legal proceedings will have a material adverse effect on its Consolidated Financial Statements. The Company records a liability in its Consolidated Financial Statements for these matters when a loss is known or considered probable and the amount can be reasonably estimated. The Company reviews these estimates each accounting period as additional information is known and adjusts the loss provision when appropriate. If a matter is both probable to result in a liability and the amounts of loss can be reasonably estimated, the Company estimates and discloses the possible loss or range of loss to the extent necessary for the Consolidated Financial Statements not to be misleading. If the loss is not probable or cannot be reasonably estimated, a liability is not recorded in its Consolidated Financial Statements. DBMG Class Action On November 6, 2014, a putative stockholder class action complaint challenging the tender offer by which HC2 acquired approximately 721,000 of the issued and outstanding common shares of DBMG was filed in the Court of Chancery of the State of Delaware, captioned Mark Jacobs v. Philip A. Falcone, Keith M. Hladek, Paul Voigt, Michael R. Hill, Rustin Roach, D. Ronald Yagoda, Phillip O. Elbert, HC2 Holdings, Inc., and Schuff International, Inc., Civil Action No. 10323 (the “Complaint”). On November 17, 2014, a second lawsuit was filed in the Court of Chancery of the State of Delaware, captioned Arlen Diercks v. Schuff International, Inc. Philip A. Falcone, Keith M. Hladek, Paul Voigt, Michael R. Hill, Rustin Roach, D. Ronald Yagoda, Phillip O. Elbert, HC2 Holdings, Inc., Civil Action No. 10359. On February 19, 2015, the court consolidated the actions (now designated as Schuff International, Inc. Stockholders Litigation) and appointed lead plaintiff and counsel. The currently operative complaint is the Complaint filed by Mark Jacobs. The Complaint alleges, among other things, that in connection with the tender offer, the individual members of the DBMG Board of Directors and HC2, the now-controlling stockholder of DBMG, breached their fiduciary duties to members of the plaintiff class. The Complaint also purports to challenge a potential short-form merger based upon plaintiff’s expectation that the Company would cash out the remaining public stockholders of DBMG following the completion of the tender offer. The Complaint seeks rescission of the tender offer and/or compensatory damages, as well as attorney’s fees and other relief. The defendants filed answers to the Complaint on July 30, 2015. On February 24, 2017, the parties agreed to a framework for the potential settlement of the litigation. On February 28, 2017, the Court entered an order vacating the current scheduling order and directing the parties to submit a stipulation of settlement or status report to the Court by April 21, 2017. In late March 2017, plaintiff’s counsel took three depositions to assess the fairness of the potential settlement framework. On April 24, 2017, plaintiff’s counsel submitted a status report to the Court indicating that they continued to analyze the potential settlement framework and would submit a stipulation of settlement or further status report to the Court by June 8, 2017. There can be no assurance that a settlement will be finalized or that the Court would approve such a settlement even if the parties were to enter into a settlement stipulation or agreement. The Company believes that the settlement under discussion would not have a material effect on the Company's financial condition or operating results. VAT assessment On February 20, 2017, the Company's ICS subsidiary received a notice from Her Majesty’s Revenue and Customs office in the U.K. (the “HMRC”) indicating that it was required to pay certain Value-Added Taxes (“VAT”) for the 2015 tax year. ICS disagrees with HMRC’s assessment on technical and factual grounds and intends to dispute the assessed liabilities and vigorously defend its interests. We do not believe the assessment to be probable and expect to prevail based on the facts and merits of our existing VAT position. Global Marine Dispute GMSL is in dispute with Alcatel-Lucent Submarine Networks Limited ("ASN") related to a Marine Installation Contract between the parties, dated March 11, 2016 (the "ASN Contract"). Under the ASN Contract, GMSL's obligations were to install and bury an optical fibre cable in Prudhoe Bay, Alaska. As of the date hereof, neither party has commenced legal proceedings. Pursuant to the ASN Contract any such dispute would be governed by English law and would be required to be brought in the English courts in London. ASN has alleged that GMSL committed material breaches of the ASN Contract, which entitles ASN to terminate the ASN Contract, take over the work themselves, and claim damages for their losses arising as a result of the breaches. The alleged material breaches include failure to use appropriate equipment and procedures to perform the work and failure to accurately estimate the amount of weather downtime needed. ASN has indicated to GMSL it has incurred $30 million in damages and $1.2 million in liquidated damages for the period September 2016 to October 2016, plus interest and costs. GMSL believes that it has not breached the terms and conditions of the contract and also believes that ASN has not properly terminated the contract in manner that would allow it to make a claim. However, ASN has ceased making payments to GMSL and as of March 31, 2017, the total sum of GMSL invoices raised and issued are $12.6 million , of which $8.1 million were settled by ASN and the balance of $4.5 million are therefore at risk. We believe that the allegations and claims by ASN are without merit, that ASN is required to make all payments under unpaid invoices and we intend to defend our interests vigorously. Tax Matters Currently, the Canada Revenue Agency (“CRA”) is auditing a subsidiary previously held by the Company. The Company intends to cooperate in audit matters. To date, CRA has not proposed any specific adjustments and the audit is ongoing. |
Employee Retirement Plans
Employee Retirement Plans | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Employee Retirement Plans | 15. Employee Retirement Plans The following table presents the components of net periodic benefit cost for the periods presented (in thousands): Three Months Ended March 31, 2017 2016 Service cost - benefits earning during the period $ — $ 4 Interest cost on projected benefit obligation 1,363 1,665 Expected return on assets (1,866 ) (1,766 ) Actuarial gain — 708 Foreign currency gain (loss) 7 (56 ) Net periodic benefit cost (income) $ (496 ) $ 555 The Company previously disclosed in its financial statements for the year ended December 31, 2016 that it expected to contribute $8.8 million to its pension plans in 2017 . As of March 31, 2017 , $3.0 million contributions have been made. The Company anticipates contributing the remaining balance expected to its pension plans in 2017 . |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | 16. Share-based Compensation On April 11, 2014, HC2’s Board of Directors adopted the HC2 Holdings, Inc. 2014 Omnibus Equity Award Plan (the “Omnibus Plan”), which was approved by our stockholders at the annual meeting of stockholders held on June 12, 2014. The Omnibus Plan provides that no further awards will be granted pursuant to the Company’s Management Compensation Plan, as amended (the “Prior Plan”). However, awards that had been previously granted pursuant to the Prior Plan will continue to be subject to and governed by the terms of the Prior Plan. The Compensation Committee of HC2's Board of Directors administers HC2's Omnibus Plan and the Prior Plan and has broad authority to administer, construe and interpret the plans. The Omnibus Plan provides for the grant of awards of non-qualified stock options, incentive (qualified) stock options, stock appreciation rights, restricted stock awards, restricted stock units, other stock based awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing. The Company typically issues new shares of common stock upon the exercise of stock options, as opposed to using treasury shares. The Omnibus Plan authorizes the issuance of up to 5,000,000 shares of the Company’s common stock, subject to adjustment as provided in the Omnibus Plan. The Company follows guidance which addresses the accounting for share-based payment transactions whereby an entity receives employee services in exchange for either equity instruments of the enterprise or liabilities that are based on the fair value of the enterprise’s equity instruments or that may be settled by the issuance of such equity instruments. The guidance generally requires that such transactions be accounted for using a fair-value based method and share-based compensation expense be recorded, based on the grant date fair value, estimated in accordance with the guidance, for all new and unvested stock awards that are ultimately expected to vest as the requisite service is rendered. The Company granted 70,740 and 6,848 options during the three months ended March 31, 2017 and 2016 , respectively. Of the total options granted during the three months ended March 31, 2016 , 6,848 options were granted to Philip Falcone, pursuant to a standalone option agreement entered in connection with Mr. Falcone’s appointment as Chairman, President and Chief Executive Officer of the Company, and not pursuant to the Omnibus Plan. The anti-dilution protection provision contained in such standalone option agreement was canceled in April 2016 and replaced with an award consisting solely of 1,500,000 premium stock options issued under the Omnibus Plan. The weighted average fair value at date of grant for options granted during the three months ended March 31, 2017 , and 2016 was $2.60 and $3.02 , respectively, per option. The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions shown as a weighted average for the year: Three Months Ended March 31, 2017 2016 Expected option life (in years) 5.75 4.70 Risk-free interest rate 2.22% 1.27% Expected volatility 48.29% 39.58% Dividend yield —% —% Total share-based compensation expense recognized by the Company and its subsidiaries under all equity compensation arrangements was $1.5 million and $3.2 million for the three months ended March 31, 2017 and 2016 , respectively. All grants are time based, and vest either immediately or over a period of up to 3 years. The Company recognizes compensation expense for equity awards, reduced by actual forfeitures, using the straight-line basis. Restricted Stock A summary of HC2’s restricted stock activity is as follows: Shares Weighted Average Grant Date Fair Value Unvested - December 31, 2016 115,921 $ 5.59 Granted 320,859 $ 5.50 Vested (287,655 ) $ 5.39 Forfeited — $ — Unvested - March 31, 2017 149,125 $ 5.79 As of March 31, 2017 , the unvested restricted stock represented $0.7 million of compensation expense that is expected to be recognized over the weighted average remaining vesting period of approximately 1.6 years . The number of shares of unvested restricted stock expected to vest is 149,125 . Stock Options A summary of HC2’s stock option activity is as follows: Shares Weighted Average Exercise Price Outstanding - December 31, 2016 6,829,097 $ 6.58 Granted 70,740 $ 5.50 Exercised (128,539 ) $ 3.50 Forfeited — $ — Expired — $ — Outstanding - March 31, 2017 6,771,298 $ 6.62 Eligible for exercise 4,887,017 $ 5.40 As of March 31, 2017 , intrinsic value and average remaining life of the Company's outstanding and exercisable options, respectively, were $6.2 million and $6.1 million and approximately 7.79 and 7.42 years, respectively. As of March 31, 2017 , the unvested stock options outstanding, which represented $1.9 million of compensation expense, are expected to be recognized over the weighted average remaining vesting period of 1.48 years . The number of unvested stock options expected to vest is 1,884,281 shares, with a weighted average remaining life of 8.75 years , a weighted average exercise price of $9.80 , and an intrinsic value of $0 . |
Equity
Equity | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Equity | 17. Equity Series A Preferred Stock, Series A-1 Preferred Stock and Series A-2 Preferred Stock The Company’s preferred shares authorized, issued and outstanding consisted of the following: March 31, 2017 December 31, 2016 Series A Shares authorized, $0.01 par value 20,000,000 20,000,000 Series A Shares issued and outstanding 14,808 14,808 Series A-1 Shares issued and outstanding 1,000 1,000 Series A-2 Shares issued and outstanding 14,000 14,000 In connection with the issuance of the Series A Convertible Preferred Stock, the Company originally designated the Series A Preferred Stock pursuant to a Certificate of Designation of Series A Convertible Participating Preferred Stock adopted on May 29, 2014 (the “Series A Certificate”). In connection with the issuance of the Series A-1 Preferred Stock on September 22, 2014, the Company adopted the Certificate of Designation of Series A-1 Convertible Participating Preferred Stock (the “Series A-1 Certificate”) and also amended and restated the Series A Certificate. In connection with the issuance of the Series A-2 Preferred Stock on January 5, 2015, the Company adopted the Certificate of Designation of Series A-2 Convertible Participating Preferred Stock (the “Series A-2 Certificate”) and also amended and restated the Series A Certificate and the Series A-1 Certificate. On August 10, 2015, the Company adopted certain Certificates of Correction of the Certificates of Amendment to the Certificates of Designation of the Series A Certificate, the Series A-1 Certificate and the Series A-2 Certificate, and on June 24, 2016 the Company adopted certain amendments to the Series A-1 Certificate of Designation. The Series A Certificate, the Series A-1 Certificate and the Series A-2 Certificate together, as amended, are referred to as the “Certificates of Designation.” The following summary of the terms of the Preferred Stock and the Certificates of Designation is qualified in its entirety by the complete terms of the Certificates of Designation. Dividends . The Preferred Stock accrues a cumulative quarterly cash dividend at an annualized rate of 7.50% . The accrued value of the Preferred Stock will accrete quarterly at an annualized rate of 4.00% that is reduced to 2.00% or 0.00% if the Company achieves specified rates of growth measured by increases in its net asset value; provided, that the accreting dividend rate will be 7.25% in the event that (i) the daily volume weighted average price (“VWAP”) of the common stock is less than a certain threshold amount, (ii) the common stock is not registered under Section 12(b) of the Securities Exchange Act of 1934, as amended, (iii) following May 29, 2015, the common stock is not listed on certain national securities exchanges or (iv) the Company is delinquent in the payment of any cash dividends. The Preferred Stock is also entitled to participate in cash and in-kind distributions to holders of shares of common stock on an as-converted basis. Optional Conversion . Each share of Preferred Stock may be converted by the holder into common stock at any time based on the then applicable conversion price. Pursuant to the Series A-1 Certificate, each share of Series A-1 Preferred Stock is currently convertible at a conversion price of $4.25 . Pursuant to the Series A-2 Certificate, each share of Series A-2 Preferred Stock is currently convertible at a conversion price of $7.80 . Pursuant to the Series A Certificate, each share of Series A Preferred Stock is currently convertible at a conversion price of $4.25 . Such conversion prices are subject to adjustment for dividends, certain distributions, stock splits, combinations, reclassifications, reorganizations, mergers, recapitalizations and similar events, as well as in connection with issuances of equity or equity-linked or other comparable securities by the Company at a price per share (or with a conversion or exercise price or effective issue price) that is below the applicable conversion price (which adjustment shall be made on a weighted average basis). Redemption by the Holders / Automatic Conversion . On May 29, 2021, holders of the Preferred Stock are entitled to cause the Company to redeem the Preferred Stock at the accrued value per share plus accrued but unpaid dividends (to the extent not included in the accrued value of Preferred Stock). Each share of Preferred Stock that is not so redeemed will be automatically converted into shares of common stock at the conversion price then in effect. Upon a change of control (as defined in the Certificates of Designation) holders of the Preferred Stock are entitled to cause the Company to redeem their Preferred Stock at a price per share of Preferred Stock equal to the greater of (i) the accrued value of the Preferred Stock, which amount would be multiplied by 150% in the event of a change of control occurring on or prior to May 29, 2017, plus any accrued and unpaid dividends (to the extent not included in the accrued value of Preferred Stock), and (ii) the value that would be received if the share of Preferred Stock were converted into common stock immediately prior to the change of control. Redemption by the Company . At any time after May 29, 2017, the Company may redeem the Preferred Stock, in whole but not in part, at a price per share generally equal to 150% of the original accrued value or on that date, plus accrued but unpaid dividends (to the extent not included in the accrued value of Preferred Stock), subject to the holder’s right to convert prior to such redemption. Forced Conversion . After May 29, 2017, the Company may force conversion of the Preferred Stock into common stock if the common stock’s thirty-day VWAP exceeds 150% of the then-applicable Conversion Price and the common stock’s daily VWAP exceeds 150% of the then applicable Conversion Price for at least twenty trading days out of the thirty trading day period used to calculate the thirty -day VWAP. In the event of a forced conversion, the holders of Preferred Stock will have the ability to elect cash settlement in lieu of conversion if certain market liquidity thresholds for the common stock are not achieved. Liquidation Preference . The Series A Preferred Stock ranks at parity with the Series A-1 Preferred Stock and the Series A-2 Preferred Stock. In the event of any liquidation, dissolution or winding up of the Company (any such event, a “Liquidation Event”), the holders of Preferred Stock are entitled to receive per share the greater of (i) the accrued value of the Preferred Stock, which amount would be multiplied by 150% in the event of a Liquidation Event occurring on or prior to May 29, 2017, plus any accrued and unpaid dividends (to the extent not included in the accrued value of Preferred Stock), and (ii) the value that would be received if the share of Preferred Stock were converted into common stock immediately prior to such occurrence. The Preferred Stock will rank junior to any existing or future indebtedness but senior to the common stock and any future equity securities other than any future senior or pari passu preferred stock issued in compliance with the Certificates of Designation. Voting Rights . Except as required by applicable law, the holders of the shares of each series of Preferred Stock are entitled to vote on an as-converted basis with the holders of the other series of Preferred Stock (on an as-converted basis) and holders of the Company’s common stock on all matters submitted to a vote of the holders of common stock. Certain series of Preferred Stock are entitled to vote with the holders of certain other series of Preferred Stock on certain matters, and separately as a class on certain limited matters. Subject to maintenance of certain ownership thresholds by the initial purchasers of the Series A Preferred Stock and the initial purchasers of the Series A-1 Preferred Stock (collectively, the “Series A and Series A-1 Preferred Purchasers”), the holders of the shares of Preferred Stock also have the right to vote shares of Preferred Stock as a separate class for at least one director, as discussed below under “- Board Rights.” Consent Rights . For so long as any of the Preferred Stock is outstanding, consent of the holders of shares representing at least 75% of certain of the Preferred Stock then outstanding is required for certain material actions. Board Rights . For so long as the Series A and Series A-1 Preferred Purchasers own at least a 15% interest in the Company on an as-converted basis and at least 80% of the shares of Preferred Stock issued to the Series A and Series A-1 Preferred Purchasers on an as-converted basis, the Series A and Series A-1 Preferred Purchasers will have the right to appoint and elect (voting as a separate class) a percentage of HC2's Board of Directors that is no more than 5% less than the Series A and Series A-1 Preferred Purchasers’ as-converted equity percentage of the common stock (but no fewer than one director). One such elected director (as designated by the holders of shares representing at least 75% of the Preferred Stock then outstanding) shall be entitled to be a member of each committee of the board of directors of the Company, provided, that such director membership on any such committee will be dependent upon such director meeting the qualification, and if applicable, independence criteria deemed necessary to so comply in accordance with any listing requirements of the exchanges on which the Company’s capital stock is then listed. For so long as the Director Election Condition is satisfied, if a specified breach event shall occur with respect to the Preferred Stock (defined for such purposes to include the failure to timely pay required dividends for two or more consecutive quarters or the occurrence and continuation of certain breaches of covenants contained in the Certificates of Designation), the holders of the Preferred Stock shall be entitled to appoint the number of additional directors to the board of directors of the Company that will cause a majority of the board of directors to be comprised of directors appointed by the holders of the Preferred Stock and independent directors until the cure of such specified breach event. Participation Rights . Pursuant to the securities purchase agreements entered into with the initial purchasers of the Series A Preferred Stock, the Series A-1 Preferred Stock and the Series A-2 Preferred Stock, subject to meeting certain ownership thresholds, certain purchasers of the Series A Preferred Stock, the Series A-1 Preferred Stock and the Series A-2 Preferred Stock are entitled to participate, on a pro rata basis in accordance with their ownership percentage, determined on an as-converted basis, in issuances of equity and equity linked securities by the Company. In addition, subject to meeting certain ownership thresholds, certain initial purchasers of the Series A Preferred Stock, the Series A-1 Preferred Stock and the Series A-2 Preferred Stock will be entitled to participate in issuances of preferred securities and in debt transactions of the Company. Preferred Share Conversions Luxor and Corrib Conversions On August 2, 2016, the Company entered into separate agreements with each of Corrib Master Fund, Ltd. (“Corrib”), then a holder of 1,000 shares of Series A Preferred Stock, and certain investment entities managed by Luxor Capital Group, LP ( “Luxor”), that together then held 9,000 shares of Series A-1 Preferred Stock, that govern their respective Preferred Share Conversions. In the Corrib Preferred Share Conversion (i) Corrib converted 1,000 shares of Series A Preferred Stock into 238,492 shares of the Company’s common stock, and (ii) in consideration of Corrib making such conversion, HC2 issued 15,318 newly issued shares of common stock to Corrib (such shares, the “Corrib Conversion Share Consideration”). In the Luxor Preferred Share Conversion, (i) Luxor converted 9,000 shares of Series A-1 Preferred Stock into 2,119,765 shares of the common stock and (ii) in consideration of Luxor making such conversion, HC2 issued 136,149 newly issued shares of common stock to Luxor (such shares, the “Luxor Conversion Share Consideration” and, together with the Corrib Conversion Share Consideration, the “Conversion Share Consideration”). The fair value of the Conversion Share Consideration was $0.7 million on the date of issuance and was recorded within Preferred stock and deemed dividends from conversion line item of the Consolidated Statements of Operations as a deemed dividend. The Company also agreed to provide the following two forms of additional consideration for as long as the Preferred Stock remained entitled to receive dividend payments (the "Additional Share Consideration"). The Company agreed that in the event that Corrib and Luxor would have been entitled to any Participating Dividends payable, had they not converted the Preferred Stock (as defined in the respective Series A and Series A-1 Certificate of Designation), after the date of their Preferred Share conversion, then the Company will issue to Corrib and Luxor, on the date such Participating Dividends become payable by the Company, in a transaction exempt from the registration requirements of the Securities Act the number of shares of common stock equal to (a) the value of the Participating Dividends Corrib or Luxor would have received pursuant to Sections (2)(c) and (2)(d) of the respective Series A and Series A-1 Certificate of Designation, divided by (b) the Thirty Day VWAP (as defined in the respective Series A and Series A-1 Certificate of Designation) for the period ending two business days prior to the underlying event or transaction that would have entitled Corrib or Luxor to such Participating Dividend had Corrib’s or Luxor’s Preferred Stock remain unconverted. Further, the Company agreed that it will issue to Corrib and Luxor, on each quarterly anniversary commencing May 29, 2017 (or, if later, the date on which the corresponding dividend payment is made to the holders of the outstanding Preferred Stock), through and until the Maturity Date (as defined in the respective Series A and Series A-1 Certificate of Designation), in a transaction exempt from the registration requirements of the Securities Act the number of shares of common stock equal to (a) 1.875% the Accrued Value (as defined in the respective Series A and Series A-1 Certificate of Designation) of Corrib’s or Luxor’s Preferred Stock as of the Closing Date (as defined in applicable Voluntary Conversion Agreements) divided by (b) the Thirty Day VWAP (as defined in the respective Series A and Series A-1 Certificate of Designation) for the period ending two business days prior to the applicable Dividend Payment Date (as defined in the respective Series A and Series A-1 Certificate of Designation). The fair value of the Additional Share Consideration was valued by the Company at $1.5 million on the date of issuance and was recorded within Preferred stock and deemed dividends from conversion line item of the Consolidated Statements of Operations as a deemed dividend. Hudson Bay Conversion On October 7, 2016, the Company entered into an agreement with Hudson Bay Absolute Return Credit Opportunities Master Fund, LTD. ("Hudson") to convert and exchange all of Hudson's 12,500 shares of the Company's Series A Convertible Participating Preferred Stock into a total of 3,751,838 shares of the Company's common stock. Pursuant to the terms of the Series A Voluntary Conversion Agreement, HC2 and Hudson mutually agreed that on the closing date of the voluntary conversion, (i) Hudson voluntarily converted 12,499 of the 12,500 shares of Series A Preferred Stock it held into 2,980,912 shares of HC2’s common stock pursuant to the terms of the Certificate of Designation of Series A Convertible Participating Preferred Stock (the “Series A Certificate of Designation”), with such amount representing the number of shares of common stock into which the 12,499 shares of Series A Preferred Stock held by Hudson convertible pursuant to the terms of the Series A Certificate of Designation and (ii) in consideration of the conversion referenced in clause (i) above, the Company issued to the Series A holder in exchange for the single remaining share of Series A Preferred Stock held, in an exchange transaction exempt from the registration requirements of the Securities Act of 1933 and all of the rules and regulations promulgated thereunder (the “Securities Act”) under Section 3(a)(9) of the Securities Act, 770,926 shares of common stock. The fair value of the 770,926 shares was $4.4 million on the date of issuance and was recorded within Preferred stock and deemed dividends from conversion line item of the Consolidated Statements of Operations as a deemed dividend. Preferred Share Dividends During 2017 , HC2's Board of Directors declared cash dividends with respect to HC2’s issued and outstanding Preferred Stock, as presented in the following table (in thousands): Declaration Date March 31, 2017 Holders of Record Date March 31, 2017 Payment/Accrual Date April 17, 2017 Total Dividend $ 563 |
Related Parties
Related Parties | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Parties | 18. Related Parties HC2 In January 2015, the Company entered into a services agreement (the “Services Agreement”) with Harbinger Capital Partners, a related party of the Company, with respect to the provision of services that may include providing office space and operational support and each party making available their respective employees to provide services as reasonably requested by the other party, subject to any limitations contained in applicable employment agreements and the terms of the Services Agreement. The Company recognized $1.0 million and $0.7 million of expenses under the Services Agreement for the three months ended March 31, 2017 and 2016 , respectively. GMSL The parent company of GMSL, Global Marine Holdings, LLC, incurred management fees of $0.18 million and $0.16 million for the three months ended March 31, 2017 and 2016 , respectively. GMSL also has investments in various entities for which it exercises significant influence. A summary of transactions with such entities and balances outstanding are as follows (in thousands): Three Months Ended March 31, 2017 2016 Net revenue $ 7,396 $ 5,275 Operating expenses $ 3,751 $ 1,230 Interest expense $ 347 $ 370 Dividends received $ 632 $ 418 Three Months Ended March 31, 2017 2016 Accounts receivable $ 7,212 $ 5,172 Long-term obligations $ 35,501 $ 38,966 Accounts payable $ 4,343 $ 354 |
Operating Segment and Related I
Operating Segment and Related Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Operating Segment and Related Information | 19. Operating Segment and Related Information The Company currently has two primary reportable geographic segments - United States and United Kingdom. The Company has seven reportable operating segments based on management’s organization of the enterprise - Construction, Marine Services, Energy, Telecommunications, Insurance, Life Sciences, Other, and a non-operating Corporate segment. Net revenue and long-lived assets by geographic segment is reported on the basis of where the entity is domiciled. All inter-segment revenues are eliminated. The Company has no single customer representing greater than 10% of its revenues. Summary information with respect to the Company’s geographic and operating segments is as follows (in thousands): Three Months Ended March 31, 2017 2016 Net Revenue by Geographic Region United States $ 342,105 $ 226,365 United Kingdom 34,692 104,017 Other 13,771 1,362 Total $ 390,568 $ 331,744 Three Months Ended March 31, 2017 2016 Net revenue Construction $ 112,721 $ 119,081 Marine Services 44,179 32,288 Energy 4,287 1,207 Telecommunications 191,749 149,821 Insurance 36,026 29,138 Other 1,606 209 Total net revenue 390,568 331,744 Income (loss) from operations Construction 5,731 8,155 Marine Services 5,729 (4,554 ) Energy (175 ) (72 ) Telecommunications 1,585 177 Insurance 270 (8,585 ) Life Sciences (3,123 ) (2,337 ) Other (1,513 ) (1,738 ) Non-operating Corporate (7,532 ) (10,311 ) Total income (loss) from operations 972 (19,265 ) Interest expense (14,115 ) (10,326 ) Loss on contingent consideration (231 ) — Income (loss) from equity investees 7,693 (3,576 ) Other income (expense), net (4,910 ) (714 ) Loss from continuing operations before income taxes (10,591 ) (33,881 ) Income tax (expense) benefit (5,291 ) 2,539 Net loss (15,882 ) (31,342 ) Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest 1,386 880 Net loss attributable to HC2 Holdings, Inc. (14,496 ) (30,462 ) Less: Preferred stock and deemed dividends from conversions 583 1,069 Net loss attributable to common stock and participating preferred stockholders $ (15,079 ) $ (31,531 ) Three Months Ended March 31, 2017 2016 Depreciation and Amortization Construction $ 1,640 $ 529 Marine Services 5,085 5,155 Energy 1,248 429 Telecommunications 97 106 Insurance (1) (1,057 ) (619 ) Life Sciences 38 19 Other 330 336 Non-operating Corporate 16 — Total $ 7,397 $ 5,955 (1) Balance represents amortization of negative VOBA, which increases net income. Three Months Ended March 31, 2017 2016 Capital Expenditures (2) Construction $ 3,814 $ 2,095 Marine Services 2,629 2,634 Energy 2,650 1,659 Telecommunications 30 22 Insurance 278 — Life Sciences 51 102 Other (37 ) — Non-operating Corporate (2 ) — Total $ 9,413 $ 6,512 (2) The above capital expenditures exclude assets acquired under terms of capital lease and vendor financing obligations. March 31, December 31, 2017 2016 Investments Marine Services $ 50,034 $ 40,698 Insurance 1,433,030 1,407,996 Life Sciences 22,176 13,067 Other 6,153 6,778 Eliminations (36,437 ) (40,621 ) Total $ 1,474,956 $ 1,427,918 March 31, December 31, 2017 2016 Property, Plant and Equipment—Net United States $ 139,704 $ 136,905 United Kingdom 137,650 141,946 Other 6,950 7,607 Total $ 284,304 $ 286,458 March 31, December 31, 2017 2016 Total Assets Construction $ 289,969 $ 295,246 Marine Services 283,657 275,660 Energy 84,075 84,602 Telecommunications 90,789 125,965 Insurance 2,063,966 2,027,059 Life Sciences 38,330 28,868 Other 8,878 10,914 Non-operating Corporate 33,135 27,583 Eliminations (36,437 ) (40,621 ) Total $ 2,856,362 $ 2,835,276 |
Backlog
Backlog | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Backlog | 20. Backlog DBMG’s backlog was $497.6 million ( $457.3 million under contracts or purchase orders and $40.3 million under letters of intent) at March 31, 2017 . DBMG’s backlog increases as contract commitments, letters of intent, notices to proceed and purchase orders are obtained, decreases as revenues are recognized and increases or decreases to reflect modifications in the work to be performed under the contracts, notices to proceed, letters of intent or purchase orders. DBMG’s backlog can be significantly affected by the receipt, or loss, of individual contracts. Approximately $295.1 million , representing 59.3% of DBMG’s backlog at March 31, 2017 , was attributable to five contracts, letters of intent, notices to proceed or purchase orders. If one or more of these large contracts or other commitments are terminated or their scope reduced, DBMG’s backlog could decrease substantially. DBMG’s backlog at December 31, 2016 was $503.5 million ( $441.1 million under contracts or purchase orders and $62.4 million under letters of intent). |
Basic and Diluted Loss Per Comm
Basic and Diluted Loss Per Common Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Income (Loss) Per Common Share | 21. Basic and Diluted Loss Per Common Share Earnings per share ("EPS") is calculated using the two-class method, which allocates earnings among common stock and participating securities to calculate EPS when an entity's capital structure includes either two or more classes of common stock or common stock and participating securities. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities. As such, shares of any unvested restricted stock of the Company are considered participating securities. The dilutive effect of options and their equivalents (including non-vested stock issued under stock-based compensation plans), is computed using the “treasury” method. The Company had no dilutive common share equivalents during the three months ended March 31, 2017 and 2016 due to the results of operations being a loss from continuing operations, net of tax. The Company issued a warrant, Preferred Stock, as well as outstanding stock options and unvested RSUs granted under the Prior Plan and Omnibus Plan, each of which were potentially dilutive but were excluded from the calculation of diluted loss per common share due to their antidilutive effect. The following table presents a reconciliation of net income (loss) used in basic and diluted EPS calculations (in thousands, except per share amounts): Three Months Ended March 31, 2017 2016 Net loss attributable to common stock and participating preferred stockholders $ (15,079 ) $ (31,531 ) Earnings allocable to common shares: Participating shares at end of period: Weighted-average Common stock outstanding 41,948 35,262 Numerator for basic and diluted earnings per share Percentage of loss allocated to: Common Stock 100 % 100 % Preferred Stock — % — % Loss attributable to common shares - basic and diluted Net Loss $ (15,079 ) $ (31,531 ) Denominator for basic and diluted earnings per share Weighted average common shares outstanding - basic and diluted 41,948 35,262 Basic and Diluted earnings per share Net loss attributable to common stock and participating preferred stockholders - basic and diluted $ (0.36 ) $ (0.89 ) |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 22. Subsequent Events On April 6, 2017, Gaming Nation Inc. announced the conversion of the convertible debenture held by the Company. The Company made an investment in Gaming Nation pursuant to the purchase of an unsecured convertible debenture issued by Gaming Nation (the "Debenture") on April 6, 2015 in the principal amount of CDN $20 million . The Debenture earned 6% interest in-kind and converted into Gaming Nation Inc. common shares as of the maturity date of April 6, 2017. Pursuant to the conversion of the principal amount and accrued interest, the Company acquired 9,987,556 fully paid common shares equal to a conversion rate of $2.25 per Common Share, which amount equals 22.9% of the Gaming Nation's issued and outstanding common shares as of the conversion date. The Company will apply fair value method to account for its investment in Gaming Nation Inc. subsequent to the conversion. All changes in fair value will be recognized in earnings. On May 2, 2017, the Company entered into an agreement with DG Value Partners, LP and DG Value Partners II Master Funds LP, holders (collectively, the "DG Value") of the Company's Series A and Series A-1 Convertible Participating Preferred Stock, to convert and exchange all of DG Value's 2,308 Series A and 1,000 Series A-1 Convertible Participating Preferred Stock into a total of 803,469 shares of the Company's common stock. On May 9, 2017, DBMG declared a cash dividend of $1.29 per share payable to stockholders of record at the close of business on May 19, 2017 and payable on June 5, 2017. The Company will receive $4.6 million of the total dividend payout. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | New Accounting Pronouncements The Company has implemented all new accounting pronouncements that are in effect and that may impact its Condensed Consolidated Financial Statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial condition, results of operations or liquidity. |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price Allocation | For the two transactions accounted for as asset acquisitions the preliminary fair value of consideration transferred was preliminarily allocated based on the relative fair value (in thousands): Purchase price allocation Accounts receivable $ 1,303 Property, plant and equipment, net 42,758 Goodwill 1,257 Intangibles 4,984 Other assets 79 Total assets acquired 50,381 Accounts payable and other current liabilities (898 ) Deferred tax liability (7,086 ) Total liabilities assumed (7,984 ) Bargain purchase gain (340 ) Total net assets acquired $ 42,057 The following table summarizes the allocation of the purchase price to the fair value of identifiable assets acquired, liabilities assumed, intangibles and residual goodwill (in thousands): Purchase price allocation Cash and cash equivalents $ 2,963 Restricted cash 3 Accounts receivable 6,400 Inventory 528 Property, plant and equipment, net 29,896 Goodwill 5,541 Intangibles 7,082 Other assets 2,051 Total assets acquired 54,464 Accounts payable and other current liabilities (11,180 ) Deferred tax liability (2,819 ) Long-term obligations (20,813 ) Other liabilities (3 ) Noncontrolling interest (815 ) Total liabilities assumed (35,630 ) Enterprise value 18,834 Less fair value of noncontrolling interest 3,889 Total net assets acquired $ 14,945 The preliminary fair value of consideration transferred and its allocation among the identified assets acquired, liabilities assumed, intangibles and residual goodwill are summarized as follows (in thousands): Purchase price allocation Cash and cash equivalents $ 621 Accounts receivable, net 5,558 Costs and recognized earnings in excess of billings on uncompleted contracts 1,686 Property, plant and equipment, net 8,043 Goodwill 11,827 Intangibles 3,955 Other assets 1,209 Total assets acquired 32,899 Accounts payable and other current liabilities (5,924 ) Billings in excess of costs and recognized earnings on uncompleted contracts (617 ) Deferred tax liability (169 ) Other liabilities (685 ) Total liabilities assumed (7,395 ) Total net assets acquired $ 25,504 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Fixed Maturity and Equity Securities Available-for-Sale | The following tables provide information relating to investments in fixed maturity and equity securities (in thousands): March 31, 2017 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Fixed maturity securities U.S. Government and government agencies $ 15,720 $ 198 $ (64 ) $ 15,854 States, municipalities and political subdivisions 375,894 7,760 (2,944 ) 380,710 Foreign government 6,368 — (497 ) 5,871 Residential mortgage-backed securities 129,664 5,091 (2,498 ) 132,257 Commercial mortgage-backed securities 40,689 379 (173 ) 40,895 Asset-backed securities 96,593 830 (916 ) 96,507 Corporate and other 599,602 32,924 (2,071 ) 630,455 Total fixed maturity securities $ 1,264,530 $ 47,182 $ (9,163 ) $ 1,302,549 Equity securities Common stocks $ 16,797 $ 44 $ (2,627 ) $ 14,214 Perpetual preferred stocks 37,033 701 (51 ) 37,683 Total equity securities $ 53,830 $ 745 $ (2,678 ) $ 51,897 December 31, 2016 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Fixed maturity securities U.S. Government and government agencies $ 15,910 $ 135 $ (95 ) $ 15,950 States, municipalities and political subdivisions 374,527 4,408 (3,858 ) 375,077 Foreign government 6,380 — (402 ) 5,978 Residential mortgage-backed securities 136,126 2,634 (564 ) 138,196 Commercial mortgage-backed securities 48,715 427 (89 ) 49,053 Asset-backed securities 76,303 1,934 (572 ) 77,665 Corporate and other 600,458 23,635 (7,054 ) 617,039 Total fixed maturity securities $ 1,258,419 $ 33,173 $ (12,634 ) $ 1,278,958 Equity securities Common stocks $ 16,236 $ — $ (1,371 ) $ 14,865 Perpetual preferred stocks 37,041 191 (578 ) 36,654 Total equity securities $ 53,277 $ 191 $ (1,949 ) $ 51,519 |
Schedule of Maturities of Fixed Maturity Securities Available-for-Sale | The amortized cost and fair value of fixed maturity securities available-for-sale as of March 31, 2017 are shown by contractual maturity in the table below (in thousands). Actual maturities can differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Asset and mortgage-backed securities are shown separately in the table below, as they are not due at a single maturity date: Amortized Cost Fair Value Corporate, Municipal, U.S. Government and Other securities Due in one year or less $ 48,251 $ 48,296 Due after one year through five years 112,721 117,770 Due after five years through ten years 140,161 143,746 Due after ten years 696,451 723,078 Subtotal 997,584 1,032,890 Mortgage-backed securities 170,353 173,152 Asset-backed securities 96,593 96,507 Total $ 1,264,530 $ 1,302,549 |
Schedule of Major Industry Types of Fixed Maturity Holdings | The tables below show the major industry types of the Company’s corporate and other fixed maturity securities (in thousands): March 31, 2017 December 31, 2016 Amortized Cost Fair Value % of Total Amortized Cost Fair % of Finance, insurance, and real estate $ 203,453 $ 207,732 32.9 % $ 214,911 $ 211,834 34.3 % Transportation, communication and other services 177,685 187,253 29.7 % 180,647 189,163 30.7 % Manufacturing 110,413 117,647 18.7 % 112,644 118,440 19.2 % Other 108,051 117,823 18.7 % 92,256 97,602 15.8 % Total $ 599,602 $ 630,455 100.0 % $ 600,458 $ 617,039 100.0 % |
Schedule of Unrealized Losses for Fixed Maturities and Equity Securities | The following table presents the total unrealized losses for the 217 and 269 fixed maturity and equity securities held by the Company as of March 31, 2017 and December 31, 2016 , respectively, where the estimated fair value had declined and remained below amortized cost by the indicated amount (in thousands): March 31, 2017 December 31, 2016 Unrealized Losses % of Total Unrealized Losses % of Fixed maturity and equity securities Less than 20% $ (8,016 ) 67.7 % $ (10,069 ) 69.0 % 20% or more for less than six months (2,825 ) 23.9 % (482 ) 3.3 % 20% or more for six months or greater (1,000 ) 8.4 % (4,032 ) 27.7 % Total $ (11,841 ) 100.0 % $ (14,583 ) 100.0 % |
Schedule of Estimated Fair Value and Gross Unrealized Loss | The following tables present the estimated fair values and gross unrealized losses for the 217 and 269 fixed maturity and equity securities held by the Company that have estimated fair values below amortized cost as of each of March 31, 2017 and December 31, 2016 , respectively. The Company does not have any OTTI losses reported in AOCI. These investments are presented by investment category and the length of time the related fair value has remained below amortized cost (in thousands): March 31, 2017 Less than 12 months 12 months of greater Total Fair Value Unrealized Losses Fair Unrealized Losses Fair Unrealized Losses Fixed maturity securities U.S. Government and government agencies $ 5,833 $ (64 ) $ — $ — $ 5,833 $ (64 ) States, municipalities and political subdivisions 114,135 (2,928 ) 365 (16 ) 114,500 (2,944 ) Foreign government — — 5,871 (497 ) 5,871 (497 ) Residential mortgage-backed securities 35,648 (2,105 ) 17,519 (393 ) 53,167 (2,498 ) Commercial mortgage-backed securities 12,129 (56 ) 2,181 (117 ) 14,310 (173 ) Asset-backed securities 46,595 (442 ) 11,924 (474 ) 58,519 (916 ) Corporate and other 85,891 (2,017 ) 3,370 (54 ) 89,261 (2,071 ) Total fixed maturity securities $ 300,231 $ (7,612 ) $ 41,230 $ (1,551 ) $ 341,461 $ (9,163 ) Equity securities Common stocks $ 12,811 $ (2,167 ) $ 518 $ (460 ) $ 13,329 $ (2,627 ) Perpetual preferred stocks 4,251 (51 ) — — 4,251 (51 ) Total equity securities $ 17,062 $ (2,218 ) $ 518 $ (460 ) $ 17,580 $ (2,678 ) December 31, 2016 Less than 12 months 12 months of greater Total Fair Unrealized Losses Fair Unrealized Losses Fair Unrealized Losses Fixed maturity securities U.S. Government and government agencies $ 4,392 $ (95 ) $ — $ — $ 4,392 $ (95 ) States, municipalities and political subdivisions 207,740 (3,858 ) — — 207,740 (3,858 ) Foreign government 5,978 (402 ) — — 5,978 (402 ) Residential mortgage-backed securities 54,385 (564 ) — — 54,385 (564 ) Commercial mortgage-backed securities 13,159 (89 ) — — 13,159 (89 ) Asset-backed securities 12,443 (572 ) — — 12,443 (572 ) Corporate and other 147,653 (3,022 ) 3,579 (4,032 ) 151,232 (7,054 ) Total fixed maturity securities $ 445,750 $ (8,602 ) $ 3,579 $ (4,032 ) $ 449,329 $ (12,634 ) Equity securities Common stocks $ 14,585 $ (1,371 ) $ — $ — $ 14,585 $ (1,371 ) Perpetual preferred stocks 20,464 (578 ) — — 20,464 (578 ) Total equity securities $ 35,049 $ (1,949 ) $ — $ — $ 35,049 $ (1,949 ) |
Schedule of Other Invested Assets | Carrying values of other invested assets accounted for under cost and equity method are as follows (in thousands): March 31, 2017 December 31, 2016 Cost Equity Method Fair Value Cost Equity Method Fair Common Equity $ 138 $ 1,083 $ — $ 138 $ 1,047 $ — Preferred Equity 2,484 19,044 — 2,484 9,971 — Derivatives 3,097 — 3,694 3,097 — 3,813 Limited Partnerships — 1,007 — — 1,116 — Joint Ventures — 50,033 — — 40,697 — Total $ 5,719 $ 71,167 $ 3,694 $ 5,719 $ 52,831 $ 3,813 |
Summarized Information for Equity Method Investments | Summarized information for the Company's equity method investments as of and for the three months ended March 31, 2017 is as follows (information for two of the investees is reported on a one month lag, in thousands): Net revenue $ 120,862 Gross profit $ 38,258 Income (loss) from continuing operations $ (9,243 ) Net income (loss) $ (16,292 ) Current assets $ 297,687 Noncurrent assets $ 282,415 Current liabilities $ 193,848 Noncurrent liabilities $ 137,345 |
Net Investment Income | The major sources of net investment income were as follows (in thousands): Three Months Ended March 31, 2017 2016 Fixed maturity securities, available-for-sale at fair value $ 13,925 $ 13,266 Equity securities, available-for-sale at fair value 675 572 Mortgage loans 464 17 Policy loans 298 297 Other invested assets 4 142 Gross investment income 15,366 14,294 External investment expense (62 ) (215 ) Net investment income $ 15,304 $ 14,079 |
Net Realized Gain (Loss) on Investments | The major sources of net realized gains (losses) on investments were as follows (in thousands): Three Months Ended March 31, 2017 2016 Realized gains on fixed maturity securities $ 961 $ 321 Realized losses on fixed maturity securities (455 ) (2,309 ) Realized gains on equity securities — 88 Realized losses on equity securities — (352 ) Net realized gains (losses) on derivative instruments 275 (2,623 ) Net realized gains (losses) $ 781 $ (4,875 ) |
Fair Value of Financial Instr33
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured At Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are summarized below (in thousands): March 31, 2017 Fair Value Measurement Using: Total Level 1 Level 2 Level 3 Assets Fixed maturity securities U.S. Government and government agencies $ 15,854 $ 5,134 $ 10,705 $ 15 States, municipalities and political subdivisions 380,710 — 374,112 6,598 Foreign government 5,871 — 5,871 — Residential mortgage-backed securities 132,257 — 78,520 53,737 Commercial mortgage-backed securities 40,895 — 4,922 35,973 Asset-backed securities 96,507 — 9,347 87,160 Corporate and other 630,455 2,131 601,604 26,720 Total fixed maturity securities 1,302,549 7,265 1,085,081 210,203 Equity securities Common stocks 14,214 10,683 — 3,531 Perpetual preferred stocks 37,683 9,676 28,007 — Total equity securities 51,897 20,359 28,007 3,531 Derivatives 3,694 — — 3,694 Total assets accounted for at fair value $ 1,358,140 $ 27,624 $ 1,113,088 $ 217,428 Liabilities Warrant liability $ 4,223 $ — $ — $ 4,223 Contingent liability 11,642 — — 11,642 Other 675 — — 675 Total liabilities accounted for at fair value $ 16,540 $ — $ — $ 16,540 December 31, 2016 Fair Value Measurement Using: Total Level 1 Level 2 Level 3 Assets Fixed maturity securities U.S. Government and government agencies $ 15,950 $ 5,140 $ 10,778 $ 32 States, municipalities and political subdivisions 375,077 — 369,387 5,690 Foreign government 5,978 — 5,978 — Residential mortgage-backed securities 138,196 — 82,242 55,954 Commercial mortgage-backed securities 49,053 — 6,035 43,018 Asset-backed securities 77,665 — 4,448 73,217 Corporate and other 617,039 2,020 594,653 20,366 Total fixed maturity securities 1,278,958 7,160 1,073,521 198,277 Equity securities Common stocks 14,865 10,290 — 4,575 Perpetual preferred stocks 36,654 9,312 27,342 — Total equity securities 51,519 19,602 27,342 4,575 Derivatives 3,813 — — 3,813 Total assets accounted for at fair value $ 1,334,290 $ 26,762 $ 1,100,863 $ 206,665 Liabilities Warrant liability $ 4,058 $ — $ — $ 4,058 Contingent liability 11,411 — — 11,411 Other 816 — — 816 Total liabilities accounted for at fair value $ 16,285 $ — $ — $ 16,285 |
Schedule of Changes in Balances of Level 3 Financial Assets at Fair Value | The following tables summarize changes to the Company’s financial instruments carried at fair value and classified within Level 3 of the fair value hierarchy for the three months ended March 31, 2017 and 2016 (in thousands): Total realized/unrealized gains (losses) included in Balance at December 31, 2016 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2017 Assets Fixed maturity securities U.S. Government and government agencies $ 32 $ — $ — $ — $ (17 ) $ — $ — $ 15 States, municipalities and political subdivisions 5,690 111 797 — — — — 6,598 Residential mortgage-backed securities 55,954 (595 ) 889 48 (2,559 ) — — 53,737 Commercial mortgage-backed securities 43,018 234 (17 ) — (7,262 ) — — 35,973 Asset-backed securities 73,217 1,074 (1,684 ) 27,725 (13,172 ) — — 87,160 Corporate and other 20,366 (3,267 ) 6,641 3,000 (20 ) — — 26,720 Total fixed maturity securities 198,277 (2,443 ) 6,626 30,773 (23,030 ) — — 210,203 Equity securities Common stocks 4,575 — (1,044 ) — — — — 3,531 Total equity securities 4,575 — (1,044 ) — — — — 3,531 Derivatives 3,813 (119 ) — — — — — 3,694 Total financial assets $ 206,665 $ (2,562 ) $ 5,582 $ 30,773 $ (23,030 ) $ — $ — $ 217,428 Total realized/unrealized (gains) losses included in Balance at December 31, 2016 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2017 Liabilities Warrant liability $ 4,058 $ 165 $ — $ — $ — $ — $ — $ 4,223 Contingent liability 11,411 231 — — — — — 11,642 Other 816 (141 ) — — — — — 675 Total financial liabilities $ 16,285 $ 255 $ — $ — $ — $ — $ — $ 16,540 Total realized/unrealized gains (losses) included in Balance at December 31, 2015 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2016 Assets Fixed maturity securities U.S. Government and government agencies $ 73 $ — $ (3 ) $ — $ (17 ) $ — $ — $ 53 States, municipalities and political subdivisions 5,659 99 3 — — — — 5,761 Residential mortgage-backed securities 79,019 (1,139 ) (156 ) — (3,354 ) 6,387 (5,557 ) 75,200 Commercial mortgage-backed securities 60,525 (291 ) 632 — (3,814 ) 385 (2,832 ) 54,605 Asset-backed securities 27,653 32 (420 ) 14,660 (300 ) 4,911 (1,133 ) 45,403 Corporate and other 13,944 (18 ) (1,395 ) — (45 ) — — 12,486 Total fixed maturity securities 186,873 (1,317 ) (1,339 ) 14,660 (7,530 ) 11,683 (9,522 ) 193,508 Equity securities Common stocks 4,932 — (356 ) — — — — 4,576 Total equity securities 4,932 — (356 ) — — — — 4,576 Derivatives 4,211 — — (1,124 ) — — — 3,087 Contingent asset — — — 2,992 — — — 2,992 Total financial assets $ 196,016 $ (1,317 ) $ (1,695 ) $ 16,528 $ (7,530 ) $ 11,683 $ (9,522 ) $ 204,163 Total realized/unrealized gains (losses) included in Balance at December 31, 2015 Net earnings (loss) Other comp. income (loss) Purchases and issuances Sales and settlements Transfer to Level 3 Transfer out of Level 3 Balance at March 31, 2016 Liabilities Derivatives $ 4,332 $ (1,974 ) $ — $ — $ — $ — $ — $ 2,358 Contingent liability — — — 2,589 — — — 2,589 Total financial liabilities $ 4,332 $ (1,974 ) $ — $ 2,589 $ — $ — $ — $ 4,947 |
Schedule of Financial Instruments Measured at Fair Value on Nonrecurring Basis | The table excludes carrying amounts reported in the Consolidated Balance Sheets for cash, accounts receivable, costs and recognized earnings in excess of billings, accounts payable, accrued expenses, billings in excess of costs and recognized earnings, and other current assets and liabilities approximate fair value due to relatively short periods to maturity (in thousands): March 31, 2017 Fair Value Measurement Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Assets Mortgage loans $ 21,824 $ 21,825 $ — $ — $ 21,825 Policy loans 18,106 18,106 — 18,106 — Other invested assets 5,719 4,256 — — 4,256 Total assets not accounted for at fair value $ 45,649 $ 44,187 $ — $ 18,106 $ 26,081 Liabilities Annuity benefits accumulated (1) $ 249,276 $ 246,601 $ — $ — $ 246,601 Long-term obligations (2) 395,576 403,533 — 403,533 — Total liabilities not accounted for at fair value $ 644,852 $ 650,134 $ — $ 403,533 $ 246,601 December 31, 2016 Fair Value Measurement Using: Carrying Value Estimated Fair Value Level 1 Level 2 Level 3 Assets Mortgage loans $ 16,831 $ 16,832 $ — $ — $ 16,832 Policy loans 18,247 18,247 — 18,247 — Other invested assets 5,719 4,597 — — 4,597 Total assets not accounted for at fair value $ 40,797 $ 39,676 $ — $ 18,247 $ 21,429 Liabilities Annuity benefits accumulated (1) $ 251,270 $ 249,372 $ — $ — $ 249,372 Long-term obligations (2) 378,780 376,081 — 376,081 — Total liabilities not accounted for at fair value $ 630,050 $ 625,453 $ — $ 376,081 $ 249,372 (1) Excludes life contingent annuities in the payout phase. (2) Excludes certain lease obligations accounted for under ASC 840, "Leases". |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable consist of the following (in thousands): March 31, 2017 December 31, 2016 Contracts in progress $ 120,488 $ 121,666 Unbilled retentions 33,475 35,069 Trade receivables 75,963 113,380 Other receivables 1,340 1,102 Allowance for doubtful accounts (3,208 ) (3,619 ) Total accounts receivable $ 228,058 $ 267,598 |
Recoverable from Reinsurers (Ta
Recoverable from Reinsurers (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Insurance [Abstract] | |
Ceded Credit Risk | The following table presents information for the Company's recoverable from reinsurers assets (in thousands): March 31, 2017 December 31, 2016 Reinsurer A.M. Best Rating Amount % of Total Amount % of Total Loyal American Life Insurance Co (Cigna) A- $ 142,514 27.2 % $ 139,269 26.5 % Great American Life Insurance Co A 47,917 9.1 % 46,965 9.0 % Hannover Life Reassurance Co A+ 334,414 63.7 % 337,967 64.5 % Total $ 524,845 100.0 % $ 524,201 100.0 % |
Property, Plant and Equipment36
Property, Plant and Equipment, net (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant and Equipment | Property, plant and equipment consist of the following (in thousands): March 31, 2017 December 31, 2016 Land $ 21,029 $ 21,006 Building and leasehold improvements 31,560 31,713 Plant and transportation equipment 5,302 5,551 Cable-ships and submersibles 164,660 169,034 Equipment, furniture and fixtures, and software 104,245 101,421 Construction in progress 22,633 19,889 349,429 348,614 Less: Accumulated depreciation 65,125 62,156 $ 284,304 $ 286,458 |
Goodwill and Intangibles, net (
Goodwill and Intangibles, net (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of the Changes in the Carrying Amount of Goodwill by Reporting Unit | The changes in the carrying amount of goodwill by reporting unit are as follows (in thousands): Construction Marine Services Energy Telecom Insurance Life Sciences Other Total Balance at December 31, 2016 and March 31, 2017 $ 36,317 $ 2,468 $ 2,631 $ 3,378 $ 47,290 $ 3,620 $ 2,382 $ 98,086 |
Schedule of Intangible Assets Subject to Amortization | The changes in the carrying amount of amortizable intangible assets by reporting unit are as follows (in thousands): Construction Marine Services Energy Life Sciences Other Corporate Total Trade names Balance at December 31, 2016 $ 4,216 $ 898 $ 4,777 $ — $ — $ — $ 9,891 Periodic Amortization (119 ) (93 ) (320 ) — — — (532 ) Balance at March 31, 2017 4,097 805 4,457 — — — 9,359 Customer relationships Balance at December 31, 2016 3,438 6,344 8,889 — — — 18,671 Periodic Amortization (353 ) (108 ) (68 ) — — — (529 ) Balance at March 31, 2017 3,085 6,236 8,821 — — — 18,142 Developed technology Balance at December 31, 2016 — 539 — — 1,003 — 1,542 Periodic Amortization — (65 ) — — (251 ) — (316 ) Balance at March 31, 2017 — 474 — — 752 — 1,226 Other Balance at December 31, 2016 447 — 91 220 — 18 776 Acquisitions — — 8 99 — — 107 Periodic Amortization (68 ) — — (1 ) — (1 ) (70 ) Balance at March 31, 2017 379 — 99 318 — 17 813 Total Amortizable Intangible Assets Balance at December 31, 2016 8,101 7,781 13,757 220 1,003 18 30,880 Acquisitions — — 8 99 — — 107 Periodic Amortization (540 ) (266 ) (388 ) (1 ) (251 ) (1 ) (1,447 ) Balance at March 31, 2017 $ 7,561 $ 7,515 $ 13,377 $ 318 $ 752 $ 17 $ 29,540 |
Life, Accident and Health Res38
Life, Accident and Health Reserves (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Insurance [Abstract] | |
Schedule of Life, Accident and Health Reserves | Life, accident and health reserves consist of the following (in thousands): March 31, 2017 December 31, 2016 Long-term care insurance reserves $ 1,422,306 $ 1,407,848 Traditional life insurance reserves 101,870 102,077 Other accident and health insurance reserves 141,283 138,640 Total life, accident and health reserves $ 1,665,459 $ 1,648,565 The following table sets forth changes in the liability for claims for the portion of our long-term care insurance reserves in scope of the ASU 2015-09 disclosure requirements (in thousands): Three Months Ended March 31, 2017 2016 Beginning balance $ 226,970 $ 208,150 Less: recoverable from reinsurers (97,858 ) (94,041 ) Beginning balance, net 129,112 114,109 Incurred related to insured events of: Current year 17,641 11,482 Prior years (3,678 ) 672 Total incurred 13,963 12,154 Paid related to insured events of: Current year (557 ) (485 ) Prior years (10,660 ) (9,647 ) Total paid (11,217 ) (10,132 ) Interest on liability for policy and contract claims 1,178 1,054 Ending balance, net 133,036 117,185 Add: recoverable from reinsurers 95,091 96,088 Ending balance $ 228,127 $ 213,273 |
Accounts Payable and Other Cu39
Accounts Payable and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Other Current Liabilities | Accounts payable and other current liabilities consist of the following (in thousands): March 31, 2017 December 31, 2016 Accounts payable $ 60,477 $ 66,792 Accrued interconnection costs 61,551 93,661 Accrued payroll and employee benefits 23,358 28,668 Accrued interest 13,334 3,056 Accrued income taxes 13,757 3,983 Accrued expenses and other current liabilities 63,680 55,573 Total accounts payable and other current liabilities $ 236,157 $ 251,733 |
Long-term Obligations (Tables)
Long-term Obligations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Obligations | Long-term debt consists of the following (in thousands): March 31, 2017 December 31, 2016 HC2 11.0% Senior Secured Notes, due in 2019 $ 362,000 $ 307,000 HC22 11.0% Senior Secured Bridge Note, due in 2019 (the "11.0% Bridge Notes") — 35,000 GMSL Notes payable and revolving lines of credit, various maturity dates 16,957 17,522 LIBOR plus 3.65% Notes, due in 2019 — 3,026 Obligations under capital leases 50,044 49,717 DBMG LIBOR plus 4.0% Notes, due in 2018 and 2019 8,764 9,439 LIBOR plus 3.0% Line of Credit — — ANG 5.5% Term Loan, due in 2018 460 501 4.5% Note due in 2022 (1) 13,172 13,343 4.25% Seller Note, due in 2022 2,714 2,796 Other 158 75 Total 454,269 438,419 Issuance discount or premium and deferred financing costs, net (8,649 ) (9,923 ) Total long-term obligations $ 445,620 $ 428,496 (1) ANG refinanced and consolidated all three of its loans with Pioneer during the first quarter of 2017. |
Employee Retirement Plans (Tabl
Employee Retirement Plans (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Compensation and Retirement Disclosure [Abstract] | |
Components of Net Periodic Benefit Cost | The following table presents the components of net periodic benefit cost for the periods presented (in thousands): Three Months Ended March 31, 2017 2016 Service cost - benefits earning during the period $ — $ 4 Interest cost on projected benefit obligation 1,363 1,665 Expected return on assets (1,866 ) (1,766 ) Actuarial gain — 708 Foreign currency gain (loss) 7 (56 ) Net periodic benefit cost (income) $ (496 ) $ 555 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Fair Value of Each Option Grant Estimated | The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions shown as a weighted average for the year: Three Months Ended March 31, 2017 2016 Expected option life (in years) 5.75 4.70 Risk-free interest rate 2.22% 1.27% Expected volatility 48.29% 39.58% Dividend yield —% —% |
Summary of Company's Restricted Stock Activity | A summary of HC2’s restricted stock activity is as follows: Shares Weighted Average Grant Date Fair Value Unvested - December 31, 2016 115,921 $ 5.59 Granted 320,859 $ 5.50 Vested (287,655 ) $ 5.39 Forfeited — $ — Unvested - March 31, 2017 149,125 $ 5.79 |
Summary of Company's Stock Option Activity | A summary of HC2’s stock option activity is as follows: Shares Weighted Average Exercise Price Outstanding - December 31, 2016 6,829,097 $ 6.58 Granted 70,740 $ 5.50 Exercised (128,539 ) $ 3.50 Forfeited — $ — Expired — $ — Outstanding - March 31, 2017 6,771,298 $ 6.62 Eligible for exercise 4,887,017 $ 5.40 |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Schedule of Stock by Class | The Company’s preferred shares authorized, issued and outstanding consisted of the following: March 31, 2017 December 31, 2016 Series A Shares authorized, $0.01 par value 20,000,000 20,000,000 Series A Shares issued and outstanding 14,808 14,808 Series A-1 Shares issued and outstanding 1,000 1,000 Series A-2 Shares issued and outstanding 14,000 14,000 |
Summary of Cash, PIK and Special Cash Dividends | During 2017 , HC2's Board of Directors declared cash dividends with respect to HC2’s issued and outstanding Preferred Stock, as presented in the following table (in thousands): Declaration Date March 31, 2017 Holders of Record Date March 31, 2017 Payment/Accrual Date April 17, 2017 Total Dividend $ 563 |
Related Parties (Tables)
Related Parties (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Summary of Balance Outstanding of Related Parties | A summary of transactions with such entities and balances outstanding are as follows (in thousands): Three Months Ended March 31, 2017 2016 Net revenue $ 7,396 $ 5,275 Operating expenses $ 3,751 $ 1,230 Interest expense $ 347 $ 370 Dividends received $ 632 $ 418 Three Months Ended March 31, 2017 2016 Accounts receivable $ 7,212 $ 5,172 Long-term obligations $ 35,501 $ 38,966 Accounts payable $ 4,343 $ 354 |
Operating Segment and Related45
Operating Segment and Related Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Summary of Company's Geographic and Operating Segments | Summary information with respect to the Company’s geographic and operating segments is as follows (in thousands): Three Months Ended March 31, 2017 2016 Net Revenue by Geographic Region United States $ 342,105 $ 226,365 United Kingdom 34,692 104,017 Other 13,771 1,362 Total $ 390,568 $ 331,744 Three Months Ended March 31, 2017 2016 Net revenue Construction $ 112,721 $ 119,081 Marine Services 44,179 32,288 Energy 4,287 1,207 Telecommunications 191,749 149,821 Insurance 36,026 29,138 Other 1,606 209 Total net revenue 390,568 331,744 Income (loss) from operations Construction 5,731 8,155 Marine Services 5,729 (4,554 ) Energy (175 ) (72 ) Telecommunications 1,585 177 Insurance 270 (8,585 ) Life Sciences (3,123 ) (2,337 ) Other (1,513 ) (1,738 ) Non-operating Corporate (7,532 ) (10,311 ) Total income (loss) from operations 972 (19,265 ) Interest expense (14,115 ) (10,326 ) Loss on contingent consideration (231 ) — Income (loss) from equity investees 7,693 (3,576 ) Other income (expense), net (4,910 ) (714 ) Loss from continuing operations before income taxes (10,591 ) (33,881 ) Income tax (expense) benefit (5,291 ) 2,539 Net loss (15,882 ) (31,342 ) Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest 1,386 880 Net loss attributable to HC2 Holdings, Inc. (14,496 ) (30,462 ) Less: Preferred stock and deemed dividends from conversions 583 1,069 Net loss attributable to common stock and participating preferred stockholders $ (15,079 ) $ (31,531 ) Three Months Ended March 31, 2017 2016 Depreciation and Amortization Construction $ 1,640 $ 529 Marine Services 5,085 5,155 Energy 1,248 429 Telecommunications 97 106 Insurance (1) (1,057 ) (619 ) Life Sciences 38 19 Other 330 336 Non-operating Corporate 16 — Total $ 7,397 $ 5,955 (1) Balance represents amortization of negative VOBA, which increases net income. Three Months Ended March 31, 2017 2016 Capital Expenditures (2) Construction $ 3,814 $ 2,095 Marine Services 2,629 2,634 Energy 2,650 1,659 Telecommunications 30 22 Insurance 278 — Life Sciences 51 102 Other (37 ) — Non-operating Corporate (2 ) — Total $ 9,413 $ 6,512 (2) The above capital expenditures exclude assets acquired under terms of capital lease and vendor financing obligations. |
Segment Reporting for Long-term investments, Property and Equipment - Net and Assets | March 31, December 31, 2017 2016 Investments Marine Services $ 50,034 $ 40,698 Insurance 1,433,030 1,407,996 Life Sciences 22,176 13,067 Other 6,153 6,778 Eliminations (36,437 ) (40,621 ) Total $ 1,474,956 $ 1,427,918 March 31, December 31, 2017 2016 Property, Plant and Equipment—Net United States $ 139,704 $ 136,905 United Kingdom 137,650 141,946 Other 6,950 7,607 Total $ 284,304 $ 286,458 March 31, December 31, 2017 2016 Total Assets Construction $ 289,969 $ 295,246 Marine Services 283,657 275,660 Energy 84,075 84,602 Telecommunications 90,789 125,965 Insurance 2,063,966 2,027,059 Life Sciences 38,330 28,868 Other 8,878 10,914 Non-operating Corporate 33,135 27,583 Eliminations (36,437 ) (40,621 ) Total $ 2,856,362 $ 2,835,276 |
Basic and Diluted Loss Per Co46
Basic and Diluted Loss Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Calculation of Basic Income (Loss) Per Common Share to Diluted Income (Loss) Per Common Share | The following table presents a reconciliation of net income (loss) used in basic and diluted EPS calculations (in thousands, except per share amounts): Three Months Ended March 31, 2017 2016 Net loss attributable to common stock and participating preferred stockholders $ (15,079 ) $ (31,531 ) Earnings allocable to common shares: Participating shares at end of period: Weighted-average Common stock outstanding 41,948 35,262 Numerator for basic and diluted earnings per share Percentage of loss allocated to: Common Stock 100 % 100 % Preferred Stock — % — % Loss attributable to common shares - basic and diluted Net Loss $ (15,079 ) $ (31,531 ) Denominator for basic and diluted earnings per share Weighted average common shares outstanding - basic and diluted 41,948 35,262 Basic and Diluted earnings per share Net loss attributable to common stock and participating preferred stockholders - basic and diluted $ (0.36 ) $ (0.89 ) |
Organization and Business (Deta
Organization and Business (Details) | 3 Months Ended |
Mar. 31, 2017segment | |
Business And Organization [Line Items] | |
Number of reportable segments | 7 |
DMi Inc. | Other | |
Business And Organization [Line Items] | |
Percentage of ownership | 56.00% |
NerVve Technologies Inc. | Other | |
Business And Organization [Line Items] | |
Percentage of ownership | 72.00% |
DBMG | |
Business And Organization [Line Items] | |
Parents controlling interest | 92.00% |
Marine Services | |
Business And Organization [Line Items] | |
Parents controlling interest | 95.00% |
Energy | |
Business And Organization [Line Items] | |
Parents controlling interest | 49.99% |
PTGI-ICS | |
Business And Organization [Line Items] | |
Parents controlling interest | 100.00% |
Insurance Companies | |
Business And Organization [Line Items] | |
Parents controlling interest | 100.00% |
Genoval Orthopedics inc. | |
Business And Organization [Line Items] | |
Parents controlling interest | 77.00% |
GemDerm Aesthetics, Inc | |
Business And Organization [Line Items] | |
Parents controlling interest | 71.00% |
Benevir Biopharm, Inc. | |
Business And Organization [Line Items] | |
Parents controlling interest | 80.00% |
Medibeacon Inc., and Triple Ring Technologies, Inc | |
Business And Organization [Line Items] | |
Parents controlling interest | 45.00% |
Business Combinations - Schedul
Business Combinations - Schedule of Purchase Price Allocations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Mar. 31, 2017 | |
Purchase price allocation | ||
Goodwill | $ 98,086 | $ 98,086 |
Series of Individually Immaterial Business Acquisitions | ||
Purchase price allocation | ||
Cash and cash equivalents excluding restricted cash | 2,963 | |
Restricted cash | 3 | |
Accounts receivable | 6,400 | |
Property and equipment, net | 29,896 | |
Goodwill | 5,541 | |
Intangibles | 7,082 | |
Other assets | 2,051 | |
Inventories | 528 | |
Total assets acquired | 54,464 | |
Accounts payable and other current liabilities | (11,180) | |
Deferred tax liability | (2,819) | |
Other liabilities | (3) | |
Long-term debt | (20,813) | |
Noncontrolling interest | (815) | |
Total liabilities assumed | (35,630) | |
Enterprise value | 18,834 | |
Less fair value of noncontrolling interest | 3,889 | |
Total net assets acquired | 14,945 | |
DBMG | PDC Operations (Australia) Pty Ltd (PDC) and BDS VirCon (BDS) | ||
Purchase price allocation | ||
Cash and cash equivalents | 621 | |
Accounts receivable | 5,558 | |
Costs and recognized earnings in excess of billings on uncompleted contracts | 1,686 | |
Property and equipment, net | 8,043 | |
Goodwill | 11,827 | |
Intangibles | 3,955 | |
Other assets | 1,209 | |
Total assets acquired | 32,899 | |
Accounts payable and other current liabilities | (5,924) | |
Billings in excess of costs and recognized earnings on uncompleted contracts | (617) | |
Deferred tax liability | (169) | |
Other liabilities | (685) | |
Total liabilities assumed | (7,395) | |
Total net assets acquired | $ 25,504 | |
Energy | ||
Purchase price allocation | ||
Accounts receivable | 1,303 | |
Property and equipment, net | 42,758 | |
Goodwill | 1,257 | |
Intangibles | 4,984 | |
Other assets | 79 | |
Total assets acquired | 50,381 | |
Accounts payable and other current liabilities | (898) | |
Deferred tax liability | (7,086) | |
Total liabilities assumed | (7,984) | |
Bargain purchase gain | (340) | |
Enterprise value | $ 42,057 |
Business Combinations - Constru
Business Combinations - Construction Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition [Line Items] | ||
Goodwill | $ 98,086 | $ 98,086 |
DBMG | PDC Operations (Australia) Pty Ltd (PDC) and BDS VirCon (BDS) | ||
Business Acquisition [Line Items] | ||
Consideration paid | 25,500 | |
Cash paid in acquisition | 21,400 | |
Goodwill | 11,827 | |
Acquisition costs | 200 | $ 2,500 |
DBMG | PDC Operations (Australia) Pty Ltd (PDC) and BDS VirCon (BDS) | Assembled and Trained Workforce | ||
Business Acquisition [Line Items] | ||
Goodwill | $ 2,900 |
Business Combinations - Energy
Business Combinations - Energy Segment (Details) - Energy $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($)acquisitionfueling_station | |
Business Acquisition [Line Items] | |
Number of acquisitions | acquisition | 4 |
Number of fueling stations acquired | fueling_station | 21 |
Consideration paid | $ 42.1 |
Cash paid in acquisition | 39.2 |
Customer contracts | |
Business Acquisition [Line Items] | |
Fair Value | $ 5 |
Minimum | Customer contracts | |
Business Acquisition [Line Items] | |
Amortization period | 4 years |
Maximum | Customer contracts | |
Business Acquisition [Line Items] | |
Amortization period | 15 years |
Medium-term Notes | 4.25% Seller Note, due in 2022 | |
Business Acquisition [Line Items] | |
Seller note | $ 2.9 |
Interest rate (as a percent) | 4.25% |
Business Combinations - Other A
Business Combinations - Other Acquisitions Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Sep. 30, 2017 | Nov. 01, 2016 | |
CWind Limited | |||
Business Acquisition [Line Items] | |||
Percentage of ownership interest acquired | 60.00% | 40.00% | |
Series of Individually Immaterial Business Acquisitions | |||
Business Acquisition [Line Items] | |||
Consideration paid | $ 14.9 | ||
Cash paid in acquisition | $ 9.2 | ||
Scenario, Forecast | CWind Limited | |||
Business Acquisition [Line Items] | |||
Percentage of ownership interest acquired | 40.00% |
Investments - Narrative (Detail
Investments - Narrative (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017USD ($)security | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($)security | |
Schedule of Available-for-sale Securities [Line Items] | |||
Number of fixed maturity and equity securities | security | 217 | 269 | |
Percentage of gross unrealized loss | 100.00% | 100.00% | |
Other Nonoperating Income (Expense) | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Gain (loss) resulting for changes in fair value of securities | $ (0.1) | $ (0.7) | |
Recorded impairment | $ (3.3) | 1 | |
Fixed maturity securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Percentage of gross unrealized loss | 100.00% | 100.00% | |
Fixed maturity securities | Investment grade | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Percentage of gross unrealized loss | 90.40% | 54.50% | |
Percentage of fair value | 95.90% | 83.00% | |
Not designated as hedging instrument | Mortgage-backed securities | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Investments at fair value | $ 14.7 | $ 15.2 | |
Gain (loss) resulting for changes in fair value of securities | $ 0.1 | $ (1.7) |
Investments - Schedule of Fixed
Investments - Schedule of Fixed Maturity and Equity Securities Available-for-Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Unrealized Losses | $ (11,841) | $ (14,583) |
Fixed maturity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,264,530 | 1,258,419 |
Unrealized Gains | 47,182 | 33,173 |
Unrealized Losses | (9,163) | (12,634) |
Fair Value | 1,302,549 | 1,278,958 |
U.S. Government and government agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 15,720 | 15,910 |
Unrealized Gains | 198 | 135 |
Unrealized Losses | (64) | (95) |
Fair Value | 15,854 | 15,950 |
States, municipalities and political subdivisions | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 375,894 | 374,527 |
Unrealized Gains | 7,760 | 4,408 |
Unrealized Losses | (2,944) | (3,858) |
Fair Value | 380,710 | 375,077 |
Foreign government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 6,368 | 6,380 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | (497) | (402) |
Fair Value | 5,871 | 5,978 |
Residential mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 129,664 | 136,126 |
Unrealized Gains | 5,091 | 2,634 |
Unrealized Losses | (2,498) | (564) |
Fair Value | 132,257 | 138,196 |
Commercial mortgage-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 40,689 | 48,715 |
Unrealized Gains | 379 | 427 |
Unrealized Losses | (173) | (89) |
Fair Value | 40,895 | 49,053 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 96,593 | 76,303 |
Unrealized Gains | 830 | 1,934 |
Unrealized Losses | (916) | (572) |
Fair Value | 96,507 | 77,665 |
Corporate and other | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 599,602 | 600,458 |
Unrealized Gains | 32,924 | 23,635 |
Unrealized Losses | (2,071) | (7,054) |
Fair Value | 630,455 | 617,039 |
Equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 53,830 | 53,277 |
Unrealized Gains | 745 | 191 |
Unrealized Losses | (2,678) | (1,949) |
Fair Value | 51,897 | 51,519 |
Common stocks | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 16,797 | 16,236 |
Unrealized Gains | 44 | 0 |
Unrealized Losses | (2,627) | (1,371) |
Fair Value | 14,214 | 14,865 |
Perpetual preferred stocks | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 37,033 | 37,041 |
Unrealized Gains | 701 | 191 |
Unrealized Losses | (51) | (578) |
Fair Value | $ 37,683 | $ 36,654 |
Investments - Schedule of Matur
Investments - Schedule of Maturities of Fixed Maturity Securities Available-for-Sale (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Total | $ 1,264,530 | |
Fair Value | ||
Total | 1,302,549 | $ 1,278,958 |
Corporate, Municipal, U.S. Government and Other securities | ||
Amortized Cost | ||
Due in one year or less | 48,251 | |
Due after one year through five years | 112,721 | |
Due after five years through ten years | 140,161 | |
Due after ten years | 696,451 | |
Subtotal | 997,584 | |
Fair Value | ||
Due in one year or less | 48,296 | |
Due after one year through five years | 117,770 | |
Due after five years through ten years | 143,746 | |
Due after ten years | 723,078 | |
Subtotal | 1,032,890 | |
Mortgage-backed securities | ||
Amortized Cost | ||
Amortized cost, without single maturity date | 170,353 | |
Fair Value | ||
Fair value, without single maturity date | 173,152 | |
Asset-backed securities | ||
Amortized Cost | ||
Amortized cost, without single maturity date | 96,593 | |
Fair Value | ||
Fair value, without single maturity date | $ 96,507 |
Investments - Schedule of Major
Investments - Schedule of Major Industry Types of Fixed Maturity Holdings (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 1,264,530 | |
Fair Value | $ 1,302,549 | $ 1,278,958 |
% of Total | 100.00% | 100.00% |
Fixed maturity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 599,602 | $ 600,458 |
Fair Value | $ 630,455 | $ 617,039 |
% of Total | 100.00% | 100.00% |
Fixed maturity securities | Finance, insurance, and real estate | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 203,453 | $ 214,911 |
Fair Value | $ 207,732 | $ 211,834 |
% of Total | 32.90% | 34.30% |
Fixed maturity securities | Transportation, communications, electric, gas and sanitary services | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 177,685 | $ 180,647 |
Fair Value | $ 187,253 | $ 189,163 |
% of Total | 29.70% | 30.70% |
Fixed maturity securities | Manufacturing | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 110,413 | $ 112,644 |
Fair Value | $ 117,647 | $ 118,440 |
% of Total | 18.70% | 19.20% |
Fixed maturity securities | Other | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 108,051 | $ 92,256 |
Fair Value | $ 117,823 | $ 97,602 |
% of Total | 18.70% | 15.80% |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Losses for Fixed Maturities and Equity Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Unrealized Losses | ||
Less than 20% | $ (8,016) | $ (10,069) |
20% or more for less than six months | (2,825) | (482) |
20% or more for six months or greater | (1,000) | (4,032) |
Total | $ (11,841) | $ (14,583) |
% of Total | ||
Less than 20% | 67.70% | 69.00% |
20% or more for less than six months | 23.90% | 3.30% |
20% or more for six months or greater | 8.40% | 27.70% |
Total | 100.00% | 100.00% |
Investments - Schedule of Estim
Investments - Schedule of Estimated Fair Values and Gross Unrealized Losses (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Fixed maturity securities | ||
Less than 12 months | ||
Fair Value | $ 300,231 | $ 445,750 |
Unrealized Losses | (7,612) | (8,602) |
12 months or greater | ||
Fair Value | 41,230 | 3,579 |
Unrealized Losses | (1,551) | (4,032) |
Total Fair Value | 341,461 | 449,329 |
Total Unrealized Loss | (9,163) | (12,634) |
U.S. Government and government agencies | ||
Less than 12 months | ||
Fair Value | 5,833 | 4,392 |
Unrealized Losses | (64) | (95) |
12 months or greater | ||
Fair Value | 0 | 0 |
Unrealized Losses | 0 | 0 |
Total Fair Value | 5,833 | 4,392 |
Total Unrealized Loss | (64) | (95) |
States, municipalities and political subdivisions | ||
Less than 12 months | ||
Fair Value | 114,135 | 207,740 |
Unrealized Losses | (2,928) | (3,858) |
12 months or greater | ||
Fair Value | 365 | 0 |
Unrealized Losses | (16) | 0 |
Total Fair Value | 114,500 | 207,740 |
Total Unrealized Loss | (2,944) | (3,858) |
Foreign government | ||
Less than 12 months | ||
Fair Value | 0 | 5,978 |
Unrealized Losses | 0 | (402) |
12 months or greater | ||
Fair Value | 5,871 | 0 |
Unrealized Losses | (497) | 0 |
Total Fair Value | 5,871 | 5,978 |
Total Unrealized Loss | (497) | (402) |
Residential mortgage-backed securities | ||
Less than 12 months | ||
Fair Value | 35,648 | 54,385 |
Unrealized Losses | (2,105) | (564) |
12 months or greater | ||
Fair Value | 17,519 | 0 |
Unrealized Losses | (393) | 0 |
Total Fair Value | 53,167 | 54,385 |
Total Unrealized Loss | (2,498) | (564) |
Commercial mortgage-backed securities | ||
Less than 12 months | ||
Fair Value | 12,129 | 13,159 |
Unrealized Losses | (56) | (89) |
12 months or greater | ||
Fair Value | 2,181 | 0 |
Unrealized Losses | (117) | 0 |
Total Fair Value | 14,310 | 13,159 |
Total Unrealized Loss | (173) | (89) |
Asset-backed securities | ||
Less than 12 months | ||
Fair Value | 46,595 | 12,443 |
Unrealized Losses | (442) | (572) |
12 months or greater | ||
Fair Value | 11,924 | 0 |
Unrealized Losses | (474) | 0 |
Total Fair Value | 58,519 | 12,443 |
Total Unrealized Loss | (916) | (572) |
Corporate and other | ||
Less than 12 months | ||
Fair Value | 85,891 | 147,653 |
Unrealized Losses | (2,017) | (3,022) |
12 months or greater | ||
Fair Value | 3,370 | 3,579 |
Unrealized Losses | (54) | (4,032) |
Total Fair Value | 89,261 | 151,232 |
Total Unrealized Loss | (2,071) | (7,054) |
Equity securities | ||
Less than 12 months | ||
Fair Value | 17,062 | 35,049 |
Unrealized Losses | (2,218) | (1,949) |
12 months or greater | ||
Fair Value | 518 | 0 |
Unrealized Losses | (460) | 0 |
Total Fair Value | 17,580 | 35,049 |
Total Unrealized Loss | (2,678) | (1,949) |
Common Stock | ||
Less than 12 months | ||
Fair Value | 12,811 | 14,585 |
Unrealized Losses | (2,167) | (1,371) |
12 months or greater | ||
Fair Value | 518 | 0 |
Unrealized Losses | (460) | 0 |
Total Fair Value | 13,329 | 14,585 |
Total Unrealized Loss | (2,627) | (1,371) |
Equity securities | ||
Less than 12 months | ||
Fair Value | 4,251 | 20,464 |
Unrealized Losses | (51) | (578) |
12 months or greater | ||
Fair Value | 0 | 0 |
Unrealized Losses | 0 | 0 |
Total Fair Value | 4,251 | 20,464 |
Total Unrealized Loss | $ (51) | $ (578) |
Investments - Schedule of Other
Investments - Schedule of Other Invested Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of Investment Holdings [Line Items] | ||
Cost Method | $ 5,719 | $ 5,719 |
Equity Method | 71,167 | 52,831 |
Fair Value | 3,694 | 3,813 |
Common Equity | ||
Summary of Investment Holdings [Line Items] | ||
Cost Method | 138 | 138 |
Equity Method | 1,083 | 1,047 |
Preferred Equity | ||
Summary of Investment Holdings [Line Items] | ||
Cost Method | 2,484 | 2,484 |
Equity Method | 19,044 | 9,971 |
Derivatives | ||
Summary of Investment Holdings [Line Items] | ||
Cost Method | 3,097 | 3,097 |
Fair Value | 3,694 | 3,813 |
Limited partnerships | ||
Summary of Investment Holdings [Line Items] | ||
Equity Method | 1,007 | 1,116 |
Joint Ventures | ||
Summary of Investment Holdings [Line Items] | ||
Equity Method | $ 50,033 | $ 40,697 |
Investments - Summarized Inform
Investments - Summarized Information for Equity Method Investments (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |
Net revenue | $ 120,862 |
Gross profit | 38,258 |
Income (loss) from continuing operations | (9,243) |
Net income (loss) | (16,292) |
Current assets | 297,687 |
Noncurrent assets | 282,415 |
Current liabilities | 193,848 |
Noncurrent liabilities | $ 137,345 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Investment [Line Items] | ||
Gross investment income | $ 15,366 | $ 14,294 |
External investment expense | (62) | (215) |
Net investment income | 15,304 | 14,079 |
Fixed Maturities | ||
Investment [Line Items] | ||
Net investment income | 13,925 | 13,266 |
Equity securities | ||
Investment [Line Items] | ||
Net investment income | 675 | 572 |
Mortgage loans | ||
Investment [Line Items] | ||
Net investment income | 464 | 17 |
Policy loans | ||
Investment [Line Items] | ||
Net investment income | 298 | 297 |
Other invested assets | ||
Investment [Line Items] | ||
Net investment income | $ 4 | $ 142 |
Investments - Net Realized Gain
Investments - Net Realized Gain (Loss) on Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Investment [Line Items] | ||
Realized gains (losses) | $ 781 | $ (4,875) |
Fixed Maturities | ||
Investment [Line Items] | ||
Realized gains | 961 | 321 |
Realized losses | (455) | (2,309) |
Equity securities | ||
Investment [Line Items] | ||
Realized gains | 0 | 88 |
Realized losses | 0 | (352) |
Derivatives | ||
Investment [Line Items] | ||
Realized gains (losses) | $ 275 | $ (2,623) |
Fair Value of Financial Instr62
Fair Value of Financial Instruments - Summary of Assets and Liabilities Measured At Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2017 | Dec. 31, 2016 | |
Liabilities | |||
Transfer into Level 3 | $ 11,683 | ||
U.S. Government and government agencies | |||
Assets | |||
Total equity securities | $ 15,854 | $ 15,950 | |
Liabilities | |||
Transfer into Level 3 | 0 | ||
States, municipalities and political subdivisions | |||
Assets | |||
Total equity securities | 380,710 | 375,077 | |
Liabilities | |||
Transfer into Level 3 | 0 | ||
Foreign government | |||
Assets | |||
Total equity securities | 5,871 | 5,978 | |
Residential mortgage-backed securities | |||
Assets | |||
Total equity securities | 132,257 | 138,196 | |
Liabilities | |||
Transfer into Level 3 | 6,387 | ||
Commercial mortgage-backed securities | |||
Assets | |||
Total equity securities | 40,895 | 49,053 | |
Liabilities | |||
Transfer into Level 3 | 385 | ||
Asset-backed securities | |||
Assets | |||
Total equity securities | 96,507 | 77,665 | |
Liabilities | |||
Transfer into Level 3 | 4,911 | ||
Corporate and other | |||
Assets | |||
Total equity securities | 630,455 | 617,039 | |
Liabilities | |||
Transfer into Level 3 | 0 | ||
Equity securities | |||
Assets | |||
Total equity securities | 51,897 | 51,519 | |
Liabilities | |||
Transfer into Level 3 | 0 | ||
Common Stock | |||
Assets | |||
Total equity securities | 14,214 | 14,865 | |
Liabilities | |||
Transfer into Level 3 | 0 | ||
Perpetual preferred stocks | |||
Assets | |||
Total equity securities | 37,683 | 36,654 | |
Recurring | |||
Assets | |||
Derivatives | 3,694 | 3,813 | |
Total assets not accounted for at fair value | 1,358,140 | 1,334,290 | |
Liabilities | |||
Other | 1,500 | ||
Total liabilities not accounted for at fair value | 16,540 | 16,285 | |
Recurring | Total fixed maturity securities | |||
Assets | |||
Total equity securities | 1,302,549 | 1,278,958 | |
Recurring | U.S. Government and government agencies | |||
Assets | |||
Total equity securities | 15,854 | 15,950 | |
Recurring | States, municipalities and political subdivisions | |||
Assets | |||
Total equity securities | 380,710 | 375,077 | |
Recurring | Foreign government | |||
Assets | |||
Total equity securities | 5,871 | 5,978 | |
Recurring | Residential mortgage-backed securities | |||
Assets | |||
Total equity securities | 132,257 | 138,196 | |
Recurring | Commercial mortgage-backed securities | |||
Assets | |||
Total equity securities | 40,895 | 49,053 | |
Recurring | Asset-backed securities | |||
Assets | |||
Total equity securities | 96,507 | 77,665 | |
Recurring | Corporate and other | |||
Assets | |||
Total equity securities | 630,455 | 617,039 | |
Liabilities | |||
Level 1 into Level 2 transfers | 1,100 | ||
Recurring | Equity securities | |||
Assets | |||
Total equity securities | 51,897 | 51,519 | |
Recurring | Common Stock | |||
Assets | |||
Total equity securities | 14,214 | 14,865 | |
Recurring | Perpetual preferred stocks | |||
Assets | |||
Total equity securities | 37,683 | 36,654 | |
Liabilities | |||
Level 1 into Level 2 transfers | 500 | ||
Recurring | Level 1 | |||
Assets | |||
Derivatives | 0 | 0 | |
Total assets not accounted for at fair value | 27,624 | 26,762 | |
Liabilities | |||
Total liabilities not accounted for at fair value | 0 | 0 | |
Recurring | Level 1 | Total fixed maturity securities | |||
Assets | |||
Total equity securities | 7,265 | 7,160 | |
Recurring | Level 1 | U.S. Government and government agencies | |||
Assets | |||
Total equity securities | 5,134 | 5,140 | |
Recurring | Level 1 | States, municipalities and political subdivisions | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 1 | Foreign government | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 1 | Residential mortgage-backed securities | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 1 | Commercial mortgage-backed securities | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 1 | Asset-backed securities | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 1 | Corporate and other | |||
Assets | |||
Total equity securities | 2,131 | 2,020 | |
Recurring | Level 1 | Equity securities | |||
Assets | |||
Total equity securities | 20,359 | 19,602 | |
Recurring | Level 1 | Common Stock | |||
Assets | |||
Total equity securities | 10,683 | 10,290 | |
Recurring | Level 1 | Perpetual preferred stocks | |||
Assets | |||
Total equity securities | 9,676 | 9,312 | |
Recurring | Level 2 | |||
Assets | |||
Derivatives | 0 | 0 | |
Total assets not accounted for at fair value | 1,113,088 | 1,100,863 | |
Liabilities | |||
Total liabilities not accounted for at fair value | 0 | 0 | |
Recurring | Level 2 | Total fixed maturity securities | |||
Assets | |||
Total equity securities | 1,085,081 | 1,073,521 | |
Recurring | Level 2 | U.S. Government and government agencies | |||
Assets | |||
Total equity securities | 10,705 | 10,778 | |
Recurring | Level 2 | States, municipalities and political subdivisions | |||
Assets | |||
Total equity securities | 374,112 | 369,387 | |
Recurring | Level 2 | Foreign government | |||
Assets | |||
Total equity securities | 5,871 | 5,978 | |
Recurring | Level 2 | Residential mortgage-backed securities | |||
Assets | |||
Total equity securities | 78,520 | 82,242 | |
Recurring | Level 2 | Commercial mortgage-backed securities | |||
Assets | |||
Total equity securities | 4,922 | 6,035 | |
Recurring | Level 2 | Asset-backed securities | |||
Assets | |||
Total equity securities | 9,347 | 4,448 | |
Recurring | Level 2 | Corporate and other | |||
Assets | |||
Total equity securities | 601,604 | 594,653 | |
Recurring | Level 2 | Equity securities | |||
Assets | |||
Total equity securities | 28,007 | 27,342 | |
Recurring | Level 2 | Common Stock | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 2 | Perpetual preferred stocks | |||
Assets | |||
Total equity securities | 28,007 | 27,342 | |
Recurring | Level 3 | |||
Assets | |||
Derivatives | 3,694 | 3,813 | |
Total assets not accounted for at fair value | 217,428 | 206,665 | |
Liabilities | |||
Total liabilities not accounted for at fair value | 16,540 | 16,285 | |
Recurring | Level 3 | Total fixed maturity securities | |||
Assets | |||
Total equity securities | 210,203 | 198,277 | |
Recurring | Level 3 | U.S. Government and government agencies | |||
Assets | |||
Total equity securities | 15 | 32 | |
Recurring | Level 3 | States, municipalities and political subdivisions | |||
Assets | |||
Total equity securities | 6,598 | 5,690 | |
Recurring | Level 3 | Foreign government | |||
Assets | |||
Total equity securities | 0 | 0 | |
Recurring | Level 3 | Residential mortgage-backed securities | |||
Assets | |||
Total equity securities | 53,737 | 55,954 | |
Recurring | Level 3 | Commercial mortgage-backed securities | |||
Assets | |||
Total equity securities | 35,973 | 43,018 | |
Recurring | Level 3 | Asset-backed securities | |||
Assets | |||
Total equity securities | 87,160 | 73,217 | |
Recurring | Level 3 | Corporate and other | |||
Assets | |||
Total equity securities | 26,720 | 20,366 | |
Recurring | Level 3 | Equity securities | |||
Assets | |||
Total equity securities | 3,531 | 4,575 | |
Recurring | Level 3 | Common Stock | |||
Assets | |||
Total equity securities | 3,531 | 4,575 | |
Recurring | Level 3 | Perpetual preferred stocks | |||
Assets | |||
Total equity securities | 0 | 0 | |
Asset-backed securities | |||
Liabilities | |||
Transfer into Level 3 | $ 2,200 | ||
Warrant liability | Recurring | |||
Liabilities | |||
Warrant liability | 4,223 | 4,058 | |
Warrant liability | Recurring | Level 1 | |||
Liabilities | |||
Warrant liability | 0 | 0 | |
Warrant liability | Recurring | Level 2 | |||
Liabilities | |||
Warrant liability | 0 | 0 | |
Warrant liability | Recurring | Level 3 | |||
Liabilities | |||
Warrant liability | 4,223 | 4,058 | |
Contingent liability | Recurring | |||
Liabilities | |||
Contingent liability | 11,642 | 11,411 | |
Contingent liability | Recurring | Level 1 | |||
Liabilities | |||
Contingent liability | 0 | 0 | |
Contingent liability | Recurring | Level 2 | |||
Liabilities | |||
Contingent liability | 0 | 0 | |
Contingent liability | Recurring | Level 3 | |||
Liabilities | |||
Contingent liability | 11,642 | 11,411 | |
Other | Recurring | |||
Liabilities | |||
Other | 675 | 816 | |
Other | Recurring | Level 1 | |||
Liabilities | |||
Other | 0 | 0 | |
Other | Recurring | Level 2 | |||
Liabilities | |||
Other | 0 | 0 | |
Other | Recurring | Level 3 | |||
Liabilities | |||
Other | $ 675 | $ 816 |
Fair Value of Financial Instr63
Fair Value of Financial Instruments - Schedule of Changes in Balances of Level 3 Financial Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | |
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | $ 196,016 | $ 196,016 | ||
Total realized/unrealized net earnings (loss) | (1,317) | |||
Total realized/unrealized other comp. income (loss) | (1,695) | |||
Purchases and issuances | 16,528 | |||
Sales and settlements | (7,530) | |||
Transfer into Level 3 | 11,683 | |||
Transfer out of Level 3 | (9,522) | |||
Balance at end of period | 204,163 | |||
Changes in balances of Level 3 financial liabilities | ||||
Balance at beginning of period | $ 16,285 | 4,332 | 4,332 | |
Total realized/unrealized net earnings (loss) | 255 | (1,974) | ||
Total realized/unrealized other comp. income (loss) | 0 | 0 | ||
Purchases and issuances | 0 | 2,589 | ||
Sales and settlements | 0 | 0 | ||
Transfer into Level 3 | 0 | 0 | ||
Transfer out of Level 3 | 0 | 0 | ||
Balance at end of period | $ 16,540 | $ 16,285 | 4,947 | 16,285 |
Assets, Total | Level 3 | ||||
Changes in balances of Level 3 financial liabilities | ||||
Percent of total assets (less than) | 1.00% | |||
Derivatives | ||||
Changes in balances of Level 3 financial liabilities | ||||
Balance at beginning of period | 4,332 | 4,332 | ||
Total realized/unrealized net earnings (loss) | (1,974) | |||
Total realized/unrealized other comp. income (loss) | 0 | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 2,358 | |||
Warrant liability | ||||
Changes in balances of Level 3 financial liabilities | ||||
Balance at beginning of period | 4,058 | |||
Total realized/unrealized net earnings (loss) | $ 165 | |||
Total realized/unrealized other comp. income (loss) | 0 | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 4,223 | |||
Contingent liability | ||||
Changes in balances of Level 3 financial liabilities | ||||
Balance at beginning of period | 11,411 | 0 | 0 | |
Total realized/unrealized net earnings (loss) | 231 | 0 | ||
Total realized/unrealized other comp. income (loss) | 0 | 0 | ||
Purchases and issuances | 0 | 2,589 | ||
Sales and settlements | 0 | 0 | ||
Transfer into Level 3 | 0 | 0 | ||
Transfer out of Level 3 | 0 | 0 | ||
Balance at end of period | 11,642 | 11,411 | 2,589 | 11,411 |
Other | ||||
Changes in balances of Level 3 financial liabilities | ||||
Balance at beginning of period | 816 | |||
Total realized/unrealized net earnings (loss) | (141) | |||
Total realized/unrealized other comp. income (loss) | 0 | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 675 | 816 | 816 | |
Fixed maturity securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 186,873 | 186,873 | ||
Total realized/unrealized net earnings (loss) | (1,317) | |||
Total realized/unrealized other comp. income (loss) | (1,339) | |||
Purchases and issuances | 14,660 | |||
Sales and settlements | (7,530) | |||
Transfer into Level 3 | 11,683 | |||
Transfer out of Level 3 | (9,522) | |||
Balance at end of period | 193,508 | |||
U.S. Government and government agencies | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 73 | 73 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | (3) | |||
Purchases and issuances | 0 | |||
Sales and settlements | (17) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 53 | |||
States, municipalities and political subdivisions | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 5,659 | 5,659 | ||
Total realized/unrealized net earnings (loss) | 99 | |||
Total realized/unrealized other comp. income (loss) | 3 | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 5,761 | |||
Residential mortgage-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 79,019 | 79,019 | ||
Total realized/unrealized net earnings (loss) | (1,139) | |||
Total realized/unrealized other comp. income (loss) | (156) | |||
Purchases and issuances | 0 | |||
Sales and settlements | (3,354) | |||
Transfer into Level 3 | 6,387 | |||
Transfer out of Level 3 | (5,557) | |||
Balance at end of period | 75,200 | |||
Commercial mortgage-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 60,525 | 60,525 | ||
Total realized/unrealized net earnings (loss) | (291) | |||
Total realized/unrealized other comp. income (loss) | 632 | |||
Purchases and issuances | 0 | |||
Sales and settlements | (3,814) | |||
Transfer into Level 3 | 385 | |||
Transfer out of Level 3 | (2,832) | |||
Balance at end of period | 54,605 | |||
Asset-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 27,653 | 27,653 | ||
Total realized/unrealized net earnings (loss) | 32 | |||
Total realized/unrealized other comp. income (loss) | (420) | |||
Purchases and issuances | 14,660 | |||
Sales and settlements | (300) | |||
Transfer into Level 3 | 4,911 | |||
Transfer out of Level 3 | (1,133) | |||
Balance at end of period | 45,403 | |||
Corporate and other | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 13,944 | 13,944 | ||
Total realized/unrealized net earnings (loss) | (18) | |||
Total realized/unrealized other comp. income (loss) | (1,395) | |||
Purchases and issuances | 0 | |||
Sales and settlements | (45) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 12,486 | |||
Equity securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 4,932 | 4,932 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | (356) | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 4,576 | |||
Common Stock | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 4,932 | 4,932 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | (356) | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 4,576 | |||
Securities (Assets) | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 217,428 | 206,665 | ||
Total realized/unrealized net earnings (loss) | (2,562) | |||
Total realized/unrealized other comp. income (loss) | 5,582 | |||
Purchases and issuances | 30,773 | |||
Sales and settlements | (23,030) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 217,428 | 217,428 | ||
Securities (Assets) | Fixed maturity securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 210,203 | 198,277 | ||
Total realized/unrealized net earnings (loss) | (2,443) | |||
Total realized/unrealized other comp. income (loss) | 6,626 | |||
Purchases and issuances | 30,773 | |||
Sales and settlements | (23,030) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 210,203 | 210,203 | ||
Securities (Assets) | U.S. Government and government agencies | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 15 | 32 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | 0 | |||
Purchases and issuances | 0 | |||
Sales and settlements | (17) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 15 | 15 | ||
Securities (Assets) | States, municipalities and political subdivisions | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 6,598 | 5,690 | ||
Total realized/unrealized net earnings (loss) | 111 | |||
Total realized/unrealized other comp. income (loss) | 797 | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 6,598 | 6,598 | ||
Securities (Assets) | Residential mortgage-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 53,737 | 55,954 | ||
Total realized/unrealized net earnings (loss) | (595) | |||
Total realized/unrealized other comp. income (loss) | 889 | |||
Purchases and issuances | 48 | |||
Sales and settlements | (2,559) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 53,737 | 53,737 | ||
Securities (Assets) | Commercial mortgage-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 35,973 | 43,018 | ||
Total realized/unrealized net earnings (loss) | 234 | |||
Total realized/unrealized other comp. income (loss) | (17) | |||
Purchases and issuances | 0 | |||
Sales and settlements | (7,262) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 35,973 | 35,973 | ||
Securities (Assets) | Asset-backed securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 87,160 | 73,217 | ||
Total realized/unrealized net earnings (loss) | 1,074 | |||
Total realized/unrealized other comp. income (loss) | (1,684) | |||
Purchases and issuances | 27,725 | |||
Sales and settlements | (13,172) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 87,160 | 87,160 | ||
Securities (Assets) | Corporate and other | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 26,720 | 20,366 | ||
Total realized/unrealized net earnings (loss) | (3,267) | |||
Total realized/unrealized other comp. income (loss) | 6,641 | |||
Purchases and issuances | 3,000 | |||
Sales and settlements | (20) | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 26,720 | 26,720 | ||
Securities (Assets) | Equity securities | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 3,531 | 4,575 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | (1,044) | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 3,531 | 3,531 | ||
Securities (Assets) | Common Stock | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 3,531 | 4,575 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | (1,044) | |||
Purchases and issuances | 0 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | 3,531 | 3,531 | ||
Derivatives | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 3,694 | 3,813 | 4,211 | 4,211 |
Total realized/unrealized net earnings (loss) | (119) | 0 | ||
Total realized/unrealized other comp. income (loss) | 0 | 0 | ||
Purchases and issuances | 0 | (1,124) | ||
Sales and settlements | 0 | 0 | ||
Transfer into Level 3 | 0 | 0 | ||
Transfer out of Level 3 | $ 0 | 0 | ||
Balance at end of period | $ 3,694 | 3,087 | 3,694 | |
Contingent asset | ||||
Changes in balances of Level 3 financial assets | ||||
Balance at beginning of period | 0 | $ 0 | ||
Total realized/unrealized net earnings (loss) | 0 | |||
Total realized/unrealized other comp. income (loss) | 0 | |||
Purchases and issuances | 2,992 | |||
Sales and settlements | 0 | |||
Transfer into Level 3 | 0 | |||
Transfer out of Level 3 | 0 | |||
Balance at end of period | $ 2,992 |
Fair Value of Financial Instr64
Fair Value of Financial Instruments - Schedule of Financial Instruments Measured on Nonrecurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Mortgage loans | $ 21,824 | $ 16,831 |
Policy loans | 18,106 | 18,247 |
Other invested assets | 80,580 | 62,363 |
Nonrecurring | Level 1 | ||
Assets | ||
Mortgage loans | 0 | 0 |
Policy loans | 0 | 0 |
Other invested assets | 0 | 0 |
Total assets not accounted for at fair value | 0 | 0 |
Liabilities | ||
Annuity benefits accumulated | 0 | 0 |
Long-term obligations | 0 | 0 |
Total liabilities not accounted for at fair value | 0 | 0 |
Nonrecurring | Level 2 | ||
Assets | ||
Mortgage loans | 0 | 0 |
Policy loans | 18,106 | 18,247 |
Other invested assets | 0 | 0 |
Total assets not accounted for at fair value | 18,106 | 18,247 |
Liabilities | ||
Annuity benefits accumulated | 0 | 0 |
Long-term obligations | 403,533 | 376,081 |
Total liabilities not accounted for at fair value | 403,533 | 376,081 |
Nonrecurring | Level 3 | ||
Assets | ||
Mortgage loans | 21,825 | 16,832 |
Policy loans | 0 | 0 |
Other invested assets | 4,256 | 4,597 |
Total assets not accounted for at fair value | 26,081 | 21,429 |
Liabilities | ||
Annuity benefits accumulated | 246,601 | 249,372 |
Long-term obligations | 0 | 0 |
Total liabilities not accounted for at fair value | 246,601 | 249,372 |
Nonrecurring | Carrying Value | ||
Assets | ||
Mortgage loans | 21,824 | 16,831 |
Policy loans | 18,106 | 18,247 |
Other invested assets | 5,719 | 5,719 |
Total assets not accounted for at fair value | 45,649 | 40,797 |
Liabilities | ||
Annuity benefits accumulated | 249,276 | 251,270 |
Long-term obligations | 395,576 | 378,780 |
Total liabilities not accounted for at fair value | 644,852 | 630,050 |
Nonrecurring | Estimated Fair Value | ||
Assets | ||
Mortgage loans | 21,825 | 16,832 |
Policy loans | 18,106 | 18,247 |
Other invested assets | 4,256 | 4,597 |
Total assets not accounted for at fair value | 44,187 | 39,676 |
Liabilities | ||
Annuity benefits accumulated | 246,601 | 249,372 |
Long-term obligations | 403,533 | 376,081 |
Total liabilities not accounted for at fair value | $ 650,134 | $ 625,453 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Contracts in progress | $ 120,488 | $ 121,666 |
Unbilled retentions | 33,475 | 35,069 |
Trade receivables | 75,963 | 113,380 |
Other receivables | 1,340 | 1,102 |
Allowance for doubtful accounts | (3,208) | (3,619) |
Total accounts receivable | $ 228,058 | $ 267,598 |
Recoverable from Reinsurers (De
Recoverable from Reinsurers (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Ceded Credit Risk [Line Items] | ||
Amount | $ 524,845 | $ 524,201 |
% of Total, Reinsurance recoverable | Reinsurer Concentration Risk | ||
Ceded Credit Risk [Line Items] | ||
Recoverable from reinsurers assets percent | 100.00% | 100.00% |
Loyal American Life Insurance Co (Cigna) | A- | ||
Ceded Credit Risk [Line Items] | ||
Amount | $ 142,514 | $ 139,269 |
Loyal American Life Insurance Co (Cigna) | A- | % of Total, Reinsurance recoverable | Reinsurer Concentration Risk | ||
Ceded Credit Risk [Line Items] | ||
Recoverable from reinsurers assets percent | 27.20% | 26.50% |
Great American Life Insurance Co | A | ||
Ceded Credit Risk [Line Items] | ||
Amount | $ 47,917 | $ 46,965 |
Great American Life Insurance Co | A | % of Total, Reinsurance recoverable | Reinsurer Concentration Risk | ||
Ceded Credit Risk [Line Items] | ||
Recoverable from reinsurers assets percent | 9.10% | 9.00% |
Hannover Life Reassurance Co | A | ||
Ceded Credit Risk [Line Items] | ||
Amount | $ 334,414 | $ 337,967 |
Hannover Life Reassurance Co | A | % of Total, Reinsurance recoverable | Reinsurer Concentration Risk | ||
Ceded Credit Risk [Line Items] | ||
Recoverable from reinsurers assets percent | 63.70% | 64.50% |
Property, Plant and Equipment67
Property, Plant and Equipment, net - Summary of Property, Plant and Equipment, net (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 349,429 | $ 348,614 |
Less: Accumulated depreciation | 65,125 | 62,156 |
Property, plant and equipment, net | 284,304 | 286,458 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 21,029 | 21,006 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 31,560 | 31,713 |
Plant and transportation equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 5,302 | 5,551 |
Cable-ships and submersibles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 164,660 | 169,034 |
Equipment, furniture and fixtures, and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 104,245 | 101,421 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 22,633 | $ 19,889 |
Property, Plant and Equipment68
Property, Plant and Equipment, net - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 8.3 | $ 7.6 | |
Depreciation expense with cost of revenue | 1.2 | $ 1.9 | |
Cable-ships and submersibles | |||
Property, Plant and Equipment [Line Items] | |||
Net book value of equipment under capital leases | $ 49.5 | $ 51 |
Goodwill and Intangibles, net -
Goodwill and Intangibles, net - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Insurance Companies | State licenses | |
Finite-Lived Intangible Assets [Line Items] | |
Indefinite-lived intangible assets | $ 2.5 |
Benevir Biopharm, Inc. | In Process Research and Development | |
Finite-Lived Intangible Assets [Line Items] | |
Indefinite-lived intangible assets | $ 6.4 |
Goodwill and Intangibles, net70
Goodwill and Intangibles, net - Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | $ 98,086 | $ 98,086 |
Construction | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 36,317 | 36,317 |
Marine Services | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 2,468 | 2,468 |
Energy | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 2,631 | 2,631 |
Telecom | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 3,378 | 3,378 |
Insurance | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 47,290 | 47,290 |
Life Sciences | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | 3,620 | 3,620 |
Other | ||
Goodwill [Line Items] | ||
Balance at December 31, 2016 and March 31, 2017 | $ 2,382 | $ 2,382 |
Goodwill and Intangibles, net71
Goodwill and Intangibles, net - Intangible Assets Subject to Amortization (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | $ 30,880 |
Acquisitions | 107 |
Periodic Amortization | (1,447) |
Balance as of end of period | 29,540 |
Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 1,003 |
Acquisitions | 0 |
Periodic Amortization | (251) |
Balance as of end of period | 752 |
Non-operating Corporate | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 18 |
Acquisitions | 0 |
Periodic Amortization | (1) |
Balance as of end of period | 17 |
Trade names | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 9,891 |
Periodic Amortization | (532) |
Balance as of end of period | 9,359 |
Trade names | Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Trade names | Non-operating Corporate | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Customer relationships | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 18,671 |
Periodic Amortization | (529) |
Balance as of end of period | 18,142 |
Customer relationships | Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Customer relationships | Non-operating Corporate | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Developed technology | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 1,542 |
Periodic Amortization | (316) |
Balance as of end of period | 1,226 |
Developed technology | Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 1,003 |
Periodic Amortization | (251) |
Balance as of end of period | 752 |
Developed technology | Non-operating Corporate | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 776 |
Acquisitions | 107 |
Periodic Amortization | (70) |
Balance as of end of period | 813 |
Other | Other | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Acquisitions | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Other | Non-operating Corporate | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 18 |
Acquisitions | 0 |
Periodic Amortization | (1) |
Balance as of end of period | 17 |
Operating Segments | Construction | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 8,101 |
Acquisitions | 0 |
Periodic Amortization | (540) |
Balance as of end of period | 7,561 |
Operating Segments | Marine Services | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 7,781 |
Acquisitions | 0 |
Periodic Amortization | (266) |
Balance as of end of period | 7,515 |
Operating Segments | Energy | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 13,757 |
Acquisitions | 8 |
Periodic Amortization | (388) |
Balance as of end of period | 13,377 |
Operating Segments | Life Sciences | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 220 |
Acquisitions | 99 |
Periodic Amortization | (1) |
Balance as of end of period | 318 |
Operating Segments | Trade names | Construction | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 4,216 |
Periodic Amortization | (119) |
Balance as of end of period | 4,097 |
Operating Segments | Trade names | Marine Services | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 898 |
Periodic Amortization | (93) |
Balance as of end of period | 805 |
Operating Segments | Trade names | Energy | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 4,777 |
Periodic Amortization | (320) |
Balance as of end of period | 4,457 |
Operating Segments | Trade names | Life Sciences | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Customer relationships | Construction | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 3,438 |
Periodic Amortization | (353) |
Balance as of end of period | 3,085 |
Operating Segments | Customer relationships | Marine Services | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 6,344 |
Periodic Amortization | (108) |
Balance as of end of period | 6,236 |
Operating Segments | Customer relationships | Energy | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 8,889 |
Periodic Amortization | (68) |
Balance as of end of period | 8,821 |
Operating Segments | Customer relationships | Life Sciences | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Developed technology | Construction | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Developed technology | Marine Services | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 539 |
Periodic Amortization | (65) |
Balance as of end of period | 474 |
Operating Segments | Developed technology | Energy | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Developed technology | Life Sciences | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Other | Construction | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 447 |
Acquisitions | 0 |
Periodic Amortization | (68) |
Balance as of end of period | 379 |
Operating Segments | Other | Marine Services | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 0 |
Acquisitions | 0 |
Periodic Amortization | 0 |
Balance as of end of period | 0 |
Operating Segments | Other | Energy | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 91 |
Acquisitions | 8 |
Periodic Amortization | 0 |
Balance as of end of period | 99 |
Operating Segments | Other | Life Sciences | |
Finite-lived Intangible Assets [Roll Forward] | |
Balance as of beginning of period | 220 |
Acquisitions | 99 |
Periodic Amortization | (1) |
Balance as of end of period | $ 318 |
Life, Accident and Health Res72
Life, Accident and Health Reserves - By Product Line (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Total life, accident and health reserves | $ 1,665,459 | $ 1,648,565 |
Long-term care insurance reserves | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Total life, accident and health reserves | 1,422,306 | 1,407,848 |
Traditional life insurance reserves | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Total life, accident and health reserves | 101,870 | 102,077 |
Other accident and health insurance reserves | ||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||
Total life, accident and health reserves | $ 141,283 | $ 138,640 |
Life, Accident and Health Res73
Life, Accident and Health Reserves - Liability for Claims of Long-Term Care Insurance Reserves (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Beginning balance | $ 1,648,565 | |
Paid related to insured events of: | ||
Ending balance | 1,665,459 | |
Other Long Duration Insurance Product Line | ||
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Beginning balance | 226,970 | $ 208,150 |
Less: recoverable from reinsurers | (97,858) | (94,041) |
Beginning balance, net | 129,112 | 114,109 |
Incurred related to insured events of: | ||
Current year | 17,641 | 11,482 |
Prior years | (3,678) | 672 |
Total incurred | 13,963 | 12,154 |
Paid related to insured events of: | ||
Current year | (557) | (485) |
Prior years | (10,660) | (9,647) |
Total paid | (11,217) | (10,132) |
Interest on liability for policy and contract claims | 1,178 | 1,054 |
Ending balance, net | 133,036 | 117,185 |
Add: recoverable from reinsurers | 95,091 | 96,088 |
Ending balance | $ 228,127 | $ 213,273 |
Accounts Payable and Other Cu74
Accounts Payable and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 60,477 | $ 66,792 |
Accrued interconnection costs | 61,551 | 93,661 |
Accrued payroll and employee benefits | 23,358 | 28,668 |
Accrued interest | 13,334 | 3,056 |
Accrued income taxes | 13,757 | 3,983 |
Accrued expenses and other current liabilities | 63,680 | 55,573 |
Total accounts payable and other current liabilities | $ 236,157 | $ 251,733 |
Long-term Obligations - Schedul
Long-term Obligations - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2017 | Jan. 31, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Other | $ 158 | $ 75 | |
Total | 454,269 | 438,419 | |
Original issue discount and debt issuance costs on Senior Secured Notes | (8,649) | (9,923) | |
Total long-term obligations | 445,620 | 428,496 | |
11.0% Senior Secured Notes, due in 2019 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 11.00% | ||
11.0% Senior Secured Notes, due in 2019 | Secured Debt | |||
Debt Instrument [Line Items] | |||
Long-term debt | 362,000 | 307,000 | |
11.0% Senior Secured Bridge Note, due in 2019 (the 11.0% Bridge Notes) | Secured Debt | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 0 | 35,000 | |
Interest rate (as a percent) | 11.00% | ||
GMSL | |||
Debt Instrument [Line Items] | |||
Obligations under capital leases | $ 50,044 | 49,717 | |
GMSL | Notes payable and revolving lines of credit, various maturity dates | |||
Debt Instrument [Line Items] | |||
Long-term debt | 16,957 | 17,522 | |
GMSL | LIBOR plus 3.65% Notes, due in 2019 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 0 | 3,026 | |
Basis spread on variable rate (as a percent) | 3.65% | ||
DBMG | LIBOR plus 4.0% Notes, due in 2018 and 2019 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 8,764 | 9,439 | |
Basis spread on variable rate (as a percent) | 4.00% | ||
DBMG | LIBOR plus 3.0% Line of Credit | Line of Credit | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 0 | 0 | |
Basis spread on variable rate (as a percent) | 3.00% | ||
ANG | LIBOR plus 3.65% Notes, due in 2019 | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 5.50% | ||
ANG | 5.5% Term Loan, due in 2018 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 460 | 501 | |
ANG | 4.5% Note due in 2022 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 13,172 | 13,343 | |
Interest rate (as a percent) | 4.50% | ||
ANG | 4.25% Seller Note, due in 2022 | |||
Debt Instrument [Line Items] | |||
Long-term debt | $ 2,714 | $ 2,796 | |
Interest rate (as a percent) | 4.25% |
Long-term Obligations - HC2 and
Long-term Obligations - HC2 and HC22 (Details) - 11.0% Senior Secured Notes, due in 2019 - USD ($) | Jan. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Aggregate principal amount | $ 55,000,000 | $ 35,000,000 |
Interest rate (as a percent) | 11.00% |
Long-term Obligations - DBMG Cr
Long-term Obligations - DBMG Credit Facilities (Details) - DBMG - USD ($) | May 06, 2014 | Mar. 31, 2017 | Dec. 31, 2016 |
Note Payable Collateralized by Real Estate | |||
Line of Credit Facility [Line Items] | |||
Outstanding debt | $ 3,200,000 | ||
Letter of Credit | |||
Line of Credit Facility [Line Items] | |||
Line of credit, maximum amount | $ 14,500,000 | 9,000,000 | |
Outstanding letters of credit | 9,000,000 | ||
Line of credit outstanding amount | 0 | $ 0 | |
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Line of credit, maximum amount | $ 50,000,000 | ||
Basis spread on variable rate (as a percent) | 3.00% | ||
Revolving Credit Facility | LIBOR plus 4.0% Notes, due in 2018 and 2019 | |||
Line of Credit Facility [Line Items] | |||
Proceeds from note payable collateralized (up to) | $ 10,000,000 | ||
Real Estate Term Advance | |||
Line of Credit Facility [Line Items] | |||
Debt term | 5 years | ||
Real Estate Term Advance | LIBOR plus 4.0% Notes, due in 2018 and 2019 | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate (as a percent) | 4.00% | ||
Outstanding debt | 5,500,000 | ||
Real Estate Term Advance | LIBOR plus 3.65% Notes, due in 2019 | |||
Line of Credit Facility [Line Items] | |||
Outstanding debt | 0 | ||
Real Estate Term Advance | Revolving Credit Facility | Note Payable Collateralized by Real Estate | |||
Line of Credit Facility [Line Items] | |||
Proceeds from note payable collateralized (up to) | $ 5,000,000 | $ 5,000,000 |
Long-term Obligations - GMSL Ca
Long-term Obligations - GMSL Capital Leases (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017USD ($)vessellease | Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | ||
Number of leases | lease | 2 | |
Number of vessels | vessel | 2 | |
Innovator Lease | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 10.40% | |
Cable Lease | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.00% | |
GMSL | ||
Debt Instrument [Line Items] | ||
Obligations under capital leases | $ | $ 50,044 | $ 49,717 |
Long-term Obligations - ANG Ter
Long-term Obligations - ANG Term Loan (Details) - Energy - 4.5% Note due in 2022 - USD ($) $ in Thousands | Mar. 31, 2017 | Jan. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.50% | ||
Outstanding debt | $ 13,172 | $ 13,343 | |
Term Loan | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.50% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Loss Carryforwards [Line Items] | ||
Income tax (expense) benefit | $ (5,291) | $ 2,539 |
Federal Tax | ||
Operating Loss Carryforwards [Line Items] | ||
NOL carryforward | 95,300 | |
Section 382 base limit | 77,800 | |
Federal Tax | Subsidiaries | ||
Operating Loss Carryforwards [Line Items] | ||
NOL carryforward | $ 21,600 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | 2 Months Ended | 3 Months Ended | ||
Oct. 31, 2016 | Mar. 31, 2017 | Dec. 31, 2016 | Nov. 06, 2014 | |
Loss Contingencies [Line Items] | ||||
Common stock, shares issued (in shares) | 42,520,073 | 42,070,675 | ||
Global Marine Dispute | ||||
Loss Contingencies [Line Items] | ||||
Invoices rejected | $ 12.6 | |||
Loss contingency, damages paid | 8.1 | |||
Loss contingency accrual | $ 4.5 | |||
Global Marine Dispute | Mistaken Payment | ||||
Loss Contingencies [Line Items] | ||||
Damages sought | $ 30 | |||
Global Marine Dispute | Liquidated Damages | ||||
Loss Contingencies [Line Items] | ||||
Damages sought | $ 1.2 | |||
DBMG | ||||
Loss Contingencies [Line Items] | ||||
Common stock, shares issued (in shares) | 721,000 |
Employee Retirement Plans - Nar
Employee Retirement Plans - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | ||
Expected contributions | $ 8.8 | |
Contribution made | $ 3 |
Employee Retirement Plans - Com
Employee Retirement Plans - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | ||
Service cost - benefits earning during the period | $ 0 | $ 4 |
Interest cost on projected benefit obligation | 1,363 | 1,665 |
Expected return on assets | (1,866) | (1,766) |
Actuarial gain | 0 | 708 |
Foreign currency gain (loss) | 7 | (56) |
Net periodic benefit cost (income) | $ (496) | $ 555 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Apr. 30, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted (in shares) | 70,740 | 6,848 | |
Weighted average fair value at date of grant for options granted (in usd per share) | $ 2.60 | $ 3.02 | |
Share-based compensation expense | $ 1.5 | $ 3.2 | |
Stock Option | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum vesting period | 3 years | ||
Weighted average remaining period | 1 year 5 months 23 days | ||
Intrinsic value of options outstanding | $ 6.2 | ||
Intrinsic value of exercisable options | $ 6.1 | ||
Average remaining life of option outstanding | 7 years 9 months 15 days | ||
Average remaining life of exercisable options | 7 years 5 months 1 day | ||
Compensation expense | $ 1.9 | ||
Unvested shares expected to vest (in shares) | 1,884,281 | ||
Weighted average remaining life | 8 years 9 months | ||
Weighted average exercise price (in usd per share) | $ 9.80 | ||
Intrinsic value | $ 0 | ||
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 0.7 | ||
Weighted average remaining period | 1 year 7 months 6 days | ||
Unvested shares expected to vest (in shares) | 149,125 | ||
Philip Falcone | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options granted (in shares) | 6,848 | ||
Omnibus Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock shares authorized to issue (in shares) | 5,000,000 | 1,500,000 |
Share-Based Compensation - Fair
Share-Based Compensation - Fair Value of Each Option Grant Estimated (Details) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Expected option life (in years) | 5 years 9 months | 4 years 8 months 12 days |
Risk-free interest rate | 2.22% | 1.27% |
Expected volatility | 48.29% | 39.58% |
Dividend yield | 0.00% | 0.00% |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Company's Restricted Stock Activity (Details) - Restricted Stock | 3 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Shares | |
Unvested at beginning of period (in shares) | shares | 115,921 |
Granted (in shares) | shares | 320,859 |
Vested (in shares) | shares | (287,655) |
Forfeitures (in shares) | shares | 0 |
Unvested at end of period (in shares) | shares | 149,125 |
Weighted Average Grant Date Fair Value | |
Unvested at beginning of period (in usd per share) | $ / shares | $ 5.59 |
Granted (in usd per share) | $ / shares | 5.50 |
Vested (in usd per share) | $ / shares | 5.39 |
Forfeitures (in usd per share) | $ / shares | 0 |
Unvested at end of period (in usd per share) | $ / shares | $ 5.79 |
Share-Based Compensation - Su87
Share-Based Compensation - Summary of Company's Stock Option Activity (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Shares | ||
Outstanding at beginning of period (in shares) | 6,829,097 | |
Granted (in shares) | 70,740 | 6,848 |
Exercised (in shares) | (128,539) | |
Forfeitures (in shares) | 0 | |
Expired (in shares) | 0 | |
Outstanding at end of period (in shares) | 6,771,298 | |
Eligible for exercise (in shares) | 4,887,017 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in usd per share) | $ 6.58 | |
Granted (in usd per share) | 5.50 | |
Exercised (in usd per share) | 3.50 | |
Forfeitures (in usd per share) | 0 | |
Expired (in usd per share) | 0 | |
Outstanding at end of period (in usd per share) | 6.62 | |
Eligible for exercise (in usd per share) | $ 5.40 |
Equity - Preferred Stock (Detai
Equity - Preferred Stock (Details) - $ / shares | Mar. 31, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | ||
Par value (in dollars per share) | $ 0.01 | $ 0.01 |
Shares authorized (in shares) | 20,000,000 | 20,000,000 |
Series A Shares issued and outstanding | ||
Class of Stock [Line Items] | ||
Shares issued (in shares) | 14,808 | 14,808 |
Shares outstanding (in shares) | 14,808 | 14,808 |
Series A-1 Shares issued and outstanding | ||
Class of Stock [Line Items] | ||
Shares issued (in shares) | 1,000 | 1,000 |
Shares outstanding (in shares) | 1,000 | 1,000 |
Series A-2 Shares issued and outstanding | ||
Class of Stock [Line Items] | ||
Shares issued (in shares) | 14,000 | 14,000 |
Shares outstanding (in shares) | 14,000 | 14,000 |
Equity - Narrative (Details)
Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Oct. 07, 2016 | Aug. 02, 2016 | Jan. 05, 2015 | Mar. 31, 2017 | Dec. 31, 2016 |
Class of Warrant or Right [Line Items] | |||||
Preferred stock cumulative cash dividend rate | 7.50% | ||||
Preferred stock dividend rate | 4.00% | ||||
Accreting dividend threshold rate | 7.25% | ||||
Volume weighted average price threshold percentage | 150.00% | ||||
Preferred stock trading days to calculate volume weighted average price (at least) | 20 days | ||||
Preferred stock force conversion, trading days to calculate volume weighted average price | 30 days | ||||
Consent rights percentage (at least) | 75.00% | ||||
Ownership interest (at least) | 15.00% | ||||
Total number of shares sold (in shares) | 42,520,073 | 42,070,675 | |||
Maximum | |||||
Class of Warrant or Right [Line Items] | |||||
Preferred stock dividend rate | 2.00% | ||||
Minimum | |||||
Class of Warrant or Right [Line Items] | |||||
Preferred stock dividend rate | 0.00% | ||||
Series A-1 Convertible Preferred Stock | Minimum | |||||
Class of Warrant or Right [Line Items] | |||||
Intrinsic value (in usd per share) | $ 4.25 | ||||
Series A-2 Preferred Stock | |||||
Class of Warrant or Right [Line Items] | |||||
Preferred stock conversion price (in usd per share) | $ 7.80 | ||||
Series A and Series A-1 Preferred | |||||
Class of Warrant or Right [Line Items] | |||||
Percent of shares issued (at least) | 80.00% | ||||
Board rights percent (more than 5% less than) | 5.00% | ||||
Series A Shares issued and outstanding | |||||
Class of Warrant or Right [Line Items] | |||||
Preferred stock, shares issued (in shares) | 14,808 | 14,808 | |||
Series A-1 Shares issued and outstanding | |||||
Class of Warrant or Right [Line Items] | |||||
Preferred stock, shares issued (in shares) | 1,000 | 1,000 | |||
Common Stock | |||||
Class of Warrant or Right [Line Items] | |||||
Conversion of preferred stock to common stock | $ 0.7 | ||||
Corrib Master Fund, Ltd. | Series A Shares issued and outstanding | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance and sale of common stock (in shares) | 1,000 | ||||
Number of shares of preferred stock converted (in shares) | 1,000 | ||||
Corrib Master Fund, Ltd. | Common Stock | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance and sale of common stock (in shares) | 15,318 | ||||
Number of shares of common stock from conversion (in shares) | 238,492 | ||||
Luxor Capital Partners, LP | Series A-1 Shares issued and outstanding | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance and sale of common stock (in shares) | 9,000 | ||||
Number of shares of preferred stock converted (in shares) | 9,000 | ||||
Luxor Capital Partners, LP | Common Stock | |||||
Class of Warrant or Right [Line Items] | |||||
Issuance and sale of common stock (in shares) | 136,149 | ||||
Number of shares of common stock from conversion (in shares) | 2,119,765 | ||||
Corrib Master Fund, Ltd. and Luxor Capital Partners, LP | |||||
Class of Warrant or Right [Line Items] | |||||
Percent of accrued value | 1.875% | ||||
Hudson Bay Absolute Return Credit Opportunities Master Fund, LTD. | Series A Shares issued and outstanding | |||||
Class of Warrant or Right [Line Items] | |||||
Number of shares of preferred stock converted (in shares) | 12,500 | 12,499 | |||
Number of shares of common stock from conversion (in shares) | 2,980,912 | ||||
Hudson Bay Absolute Return Credit Opportunities Master Fund, LTD. | Common Stock | |||||
Class of Warrant or Right [Line Items] | |||||
Number of shares of common stock from conversion (in shares) | 770,926 | ||||
Additional share consideration valued at | $ 4.4 | ||||
Number of shares converted (in shares) | 3,751,838 | ||||
Recurring | |||||
Class of Warrant or Right [Line Items] | |||||
Additional share consideration valued at | $ 1.5 |
Equity - Summary of Cash Divide
Equity - Summary of Cash Dividends (Details) - Dividend Declared for Q1 $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Dividends Payable [Line Items] | |
Declaration Date | Mar. 31, 2017 |
Holders of Record Date | Mar. 31, 2017 |
Payment/Accrual Date | Apr. 17, 2017 |
Total Dividend | $ 563 |
Related Parties - Narrative (De
Related Parties - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
GMH | ||
Related Party Transaction [Line Items] | ||
Management fees paid | $ 180 | $ 160 |
Affiliated Entity | Harbinger Capital Partners | ||
Related Party Transaction [Line Items] | ||
Expenses under service agreement | $ 1,000 | $ 700 |
Related Parties - Summary of Ba
Related Parties - Summary of Balance Outstanding of Related Parties (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Related Party Transactions [Abstract] | ||
Net revenue | $ 7,396 | $ 5,275 |
Operating expenses | 3,751 | 1,230 |
Interest expense | 347 | 370 |
Dividends received | 632 | 418 |
Accounts receivable | 7,212 | 5,172 |
Long-term debt | 35,501 | 38,966 |
Accounts payable | $ 4,343 | $ 354 |
Operating Segment and Related93
Operating Segment and Related Information - Narrative (Details) | 3 Months Ended |
Mar. 31, 2017segment | |
Segment Reporting [Abstract] | |
Number of reportable geographic segments | 2 |
Number of reportable operating segments | 7 |
Operating Segment and Related94
Operating Segment and Related Information - Geographic and Operating Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | $ 390,568 | $ 331,744 |
Income (loss) from operations | 972 | (19,265) |
Interest expense | (14,115) | (10,326) |
Loss on contingent consideration | 231 | 0 |
Income (loss) from equity investees | 7,693 | (3,576) |
Other income (expense), net | (4,910) | (714) |
Loss from continuing operations before income taxes | (10,591) | (33,881) |
Income tax (expense) benefit | (5,291) | 2,539 |
Net loss | (15,882) | (31,342) |
Less: Net loss attributable to noncontrolling interest and redeemable noncontrolling interest | 1,386 | 880 |
Net loss attributable to HC2 Holdings, Inc. | (14,496) | (30,462) |
Less: Preferred stock and deemed dividends from conversions | 583 | 1,069 |
Net loss attributable to common stock and participating preferred stockholders | (15,079) | (31,531) |
Depreciation and amortization | 7,397 | 5,955 |
Capital Expenditures | 9,413 | 6,512 |
Construction | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 112,721 | 119,081 |
Marine Services | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 44,179 | 32,288 |
Energy | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 4,287 | 1,207 |
Telecommunications | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 191,749 | 149,821 |
Insurance | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 36,026 | 29,138 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 1,606 | 209 |
Operating Segments | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Interest expense | (14,115) | (10,326) |
Loss on contingent consideration | (231) | 0 |
Income (loss) from equity investees | 7,693 | (3,576) |
Other income (expense), net | 4,910 | 714 |
Loss from continuing operations before income taxes | (10,591) | (33,881) |
Operating Segments | Construction | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | 5,731 | 8,155 |
Depreciation and amortization | 1,640 | 529 |
Capital Expenditures | 3,814 | 2,095 |
Operating Segments | Marine Services | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | 5,729 | (4,554) |
Depreciation and amortization | 5,085 | 5,155 |
Capital Expenditures | 2,629 | 2,634 |
Operating Segments | Energy | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | (175) | (72) |
Depreciation and amortization | 1,248 | 429 |
Capital Expenditures | 2,650 | 1,659 |
Operating Segments | Telecommunications | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | 1,585 | 177 |
Depreciation and amortization | 97 | 106 |
Capital Expenditures | 30 | 22 |
Operating Segments | Insurance | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | 270 | (8,585) |
Depreciation and amortization | (1,057) | (619) |
Capital Expenditures | 278 | 0 |
Operating Segments | Life Sciences | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | (3,123) | (2,337) |
Depreciation and amortization | 38 | 19 |
Capital Expenditures | 51 | 102 |
Operating Segments | Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | (1,513) | (1,738) |
Depreciation and amortization | 330 | 336 |
Capital Expenditures | (37) | 0 |
Non-operating Corporate | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | (7,532) | (10,311) |
Depreciation and amortization | 16 | 0 |
Capital Expenditures | (2) | 0 |
Operating Segments and Corporate Non Segment | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Income (loss) from operations | 972 | (19,265) |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 342,105 | 226,365 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | 34,692 | 104,017 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Net revenue | $ 13,771 | $ 1,362 |
Operating Segment and Related95
Operating Segment and Related Information - Long-term investments, Property and Equipment and Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | $ 1,474,956 | $ 1,427,918 |
Property, Plant and Equipment—Net | 284,304 | 286,458 |
Total Assets | 2,856,362 | 2,835,276 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, Plant and Equipment—Net | 139,704 | 136,905 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, Plant and Equipment—Net | 137,650 | 141,946 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property, Plant and Equipment—Net | 6,950 | 7,607 |
Operating Segments | Marine Services | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | 50,034 | 40,698 |
Total Assets | 283,657 | 275,660 |
Operating Segments | Insurance | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | 1,433,030 | 1,407,996 |
Total Assets | 2,063,966 | 2,027,059 |
Operating Segments | Life Sciences | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | 22,176 | 13,067 |
Total Assets | 38,330 | 28,868 |
Operating Segments | Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | 6,153 | 6,778 |
Total Assets | 8,878 | 10,914 |
Operating Segments | Telecommunications | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Assets | 90,789 | 125,965 |
Operating Segments | Construction | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Assets | 289,969 | 295,246 |
Operating Segments | Energy | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Assets | 84,075 | 84,602 |
Non-operating Corporate | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total Assets | 33,135 | 27,583 |
Eliminations | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Investments | (36,437) | (40,621) |
Total Assets | $ (36,437) | $ (40,621) |
Backlog (Details)
Backlog (Details) - DBMG $ in Millions | 3 Months Ended | |
Mar. 31, 2017USD ($)contract | Dec. 31, 2016USD ($) | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Backlog | $ 497.6 | $ 503.5 |
Contracts or Purchase Orders | ||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Backlog | 457.3 | 441.1 |
Letters of Intent | ||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Backlog | 40.3 | $ 62.4 |
Five Contracts, Letters of Intent, Notices to Proceed or Purchase Orders | ||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Backlog | $ 295.1 | |
Backlog percentage | 59.30% | |
Number of contracts attributable to backlog | contract | 5 |
Basic and Diluted Loss Per Co97
Basic and Diluted Loss Per Common Share - Narrative (Details) - shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share [Abstract] | ||
Dilutive common share equivalents (in shares) | 0 | 0 |
Basic and Diluted Loss Per Co98
Basic and Diluted Loss Per Common Share - Basic Income (Loss) Per Common Share to Diluted Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share [Abstract] | ||
Net loss attributable to common stock and participating preferred stockholders | $ (15,079) | $ (31,531) |
Participating shares at end of period: | ||
Weighted average common shares outstanding - basic and diluted (in shares) | 41,948 | 35,262 |
Percentage of loss allocated to: | ||
Common Stock | 100.00% | 100.00% |
Preferred Stock | 0.00% | 0.00% |
Loss attributable to common shares - basic and diluted | ||
Net loss attributable to common stock and participating preferred stockholders | $ (15,079) | $ (31,531) |
Denominator for basic and diluted earnings per share | ||
Weighted average common shares outstanding - basic and diluted (in shares) | 41,948 | 35,262 |
Basic and Diluted earnings per share | ||
Net loss attributable to common stock and participating preferred stockholders - basic and diluted (in dollars per share) | $ (0.36) | $ (0.89) |
Subsequent Events (Details)
Subsequent Events (Details) $ / shares in Units, $ in Millions | May 09, 2017USD ($)$ / shares | May 02, 2017shares | Apr. 06, 2017$ / sharesshares | Apr. 06, 2015CAD |
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Dividends receivable | $ | $ 4.6 | |||
Series A- Convertible Preferred Stock | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of shares of preferred stock converted (in shares) | 2,308 | |||
Series A-1 Convertible Preferred Stock | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of shares of preferred stock converted (in shares) | 1,000 | |||
Common Stock | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of shares of common stock from conversion (in shares) | 803,469 | |||
Gaming Nation Inc. | Convertible Debt | Unsecured Convertible Debenture | ||||
Subsequent Event [Line Items] | ||||
Aggregate principal amount | CAD | CAD 20,000,000 | |||
Gaming Nation Inc. | Subsequent Event | Convertible Debt | Unsecured Convertible Debenture | ||||
Subsequent Event [Line Items] | ||||
Percent interest in kind | 6.00% | |||
Shares acquired (in shares) | 9,987,556 | |||
Rate per common share (in dollars per share) | $ / shares | $ 2.25 | |||
Percent of issued and outstanding shares | 22.90% | |||
DBMG | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Dividends declared (in dollars per share) | $ / shares | $ 1.29 |