COVER
COVER - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 05, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 0-21513 | ||
Entity Registrant Name | DXP Enterprises, Inc. | ||
Entity Incorporation, State or Country Code | TX | ||
Entity Tax Identification Number | 76-0509661 | ||
Entity Address, Address Line One | 5301 Hollister | ||
Entity Address, City or Town | Houston | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 77040 | ||
City Area Code | 713 | ||
Local Phone Number | 996-4700 | ||
Title of 12(b) Security | Common Stock par value $0.01 | ||
Trading Symbol | DXPE | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 321 | ||
Entity Common Stock, Shares Outstanding | 19,293,280 | ||
Documents Incorporated by Reference | Portions of the definitive proxy statement for our 2021 annual meeting of shareholders are incorporated by reference into Part III hereof. The 2021 proxy statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. | ||
Entity Central Index Key | 0001020710 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Sales | $ 1,005,266 | $ 1,267,189 | $ 1,216,197 |
Cost of sales | 725,997 | 919,965 | 883,989 |
Gross profit | 279,269 | 347,224 | 332,208 |
Selling, general and administrative expense | 246,256 | 281,102 | 263,757 |
Impairment and other charges | 59,883 | 0 | 0 |
Total operating income | (26,870) | 66,122 | 68,451 |
Other expense (income), net | 74 | (45) | (1,192) |
Interest expense | 20,571 | 19,498 | 20,937 |
Income (loss) before income taxes | (47,515) | 46,669 | 48,706 |
Provision for income taxes (benefit) | (18,441) | 10,894 | 13,185 |
Net income (loss) | (29,074) | 35,775 | 35,521 |
Net loss attributable to noncontrolling interest | (348) | (260) | (111) |
Net income (loss) attributable to DXP Enterprises, Inc. | (28,726) | 36,035 | 35,632 |
Preferred stock dividend | 90 | 90 | 90 |
Net income (loss) attributable to common shareholders | (28,816) | 35,945 | 35,542 |
Cumulative translation adjustment, net of income taxes | (1,888) | (687) | 224 |
Comprehensive income (loss) | $ (30,962) | $ 35,088 | $ 35,745 |
Earnings (loss) per share (Note 14) | |||
Basic (in dollars per share) | $ (1.62) | $ 2.04 | $ 2.02 |
Diluted (in dollars per share) | $ (1.62) | $ 1.96 | $ 1.94 |
Weighted average common shares outstanding: | |||
Basic (in shares) | 17,748 | 17,592 | 17,553 |
Diluted (in shares) | 17,748 | 18,432 | 18,393 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash | $ 117,353 | $ 54,203 |
Restricted cash | 91 | 124 |
Accounts receivable, net of allowances for doubtful accounts of $8,628 and $8,929 | 163,429 | 187,116 |
Inventories | 97,071 | 129,364 |
Costs and estimated profits in excess of billings | 18,459 | 32,455 |
Prepaid expenses and other current assets | 4,548 | 4,223 |
Federal income taxes receivable | 5,632 | 996 |
Total current assets | 406,583 | 408,481 |
Property and equipment, net | 56,899 | 63,703 |
Goodwill | 248,339 | 194,052 |
Identified Intangibles, net | 80,088 | 52,582 |
Operating lease right-of-use assets | 55,188 | 66,191 |
Other long-term assets | 4,764 | 3,211 |
Total assets | 851,861 | 788,220 |
Current liabilities: | ||
Current maturities of long-term debt | 3,300 | 2,500 |
Trade accounts payable | 75,744 | 76,438 |
Accrued wages and benefits | 20,621 | 23,412 |
Customer advances | 3,688 | 3,408 |
Billings in excess of costs and estimated profits | 4,061 | 11,871 |
Short-term operating lease liabilities | 15,891 | 17,603 |
Other current liabilities | 20,834 | 12,939 |
Total current liabilities | 144,139 | 148,171 |
Long-term debt, net of current maturities and unamortized debt issuance costs | 317,139 | 235,419 |
Long-term operating lease liabilities | 38,010 | 48,605 |
Other long-term liabilities | 2,930 | 1,205 |
Deferred income taxes | 1,777 | 9,872 |
Total long-term liabilities | 359,856 | 295,101 |
Total liabilities | 503,995 | 443,272 |
Commitments and Contingencies (Note 18) | ||
Shareholders' Equity: | ||
Common stock, $0.01 par value, 100,000,000 shares authorized; 19,208,067 and 17,604,092 outstanding | 189 | 174 |
Additional paid-in capital | 192,068 | 157,886 |
Retained earnings | 176,637 | 205,680 |
Accumulated other comprehensive loss | (21,842) | (19,954) |
Total DXP Enterprises, Inc. equity | 347,068 | 343,802 |
Noncontrolling interest | 798 | 1,146 |
Total equity | 347,866 | 344,948 |
Total liabilities and equity | 851,861 | 788,220 |
Series A preferred stock | ||
Shareholders' Equity: | ||
Series A preferred stock, $1.00 par value; 1,000,000 shares authorized. Series B convertible preferred stock, $1.00 par value; 1,000,000 shares authorized | 1 | 1 |
Total equity | 1 | 1 |
Series B convertible preferred stock | ||
Shareholders' Equity: | ||
Series A preferred stock, $1.00 par value; 1,000,000 shares authorized. Series B convertible preferred stock, $1.00 par value; 1,000,000 shares authorized | $ 15 | $ 15 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Allowances for doubtful accounts | $ 8,628 | $ 8,929 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares outstanding (in shares) | 19,208,067 | 17,604,092 |
Series A preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Series B convertible preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||||||
Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||
Net income (loss) attributable to DXP Enterprises, Inc. | $ (1,900) | $ 5,700 | $ 2,200 | $ 7,300 | $ 11,100 | $ 4,600 | $ (28,726) | $ 36,035 | $ 35,632 | |
Less: net loss attributable to non-controlling interest | (348) | (260) | (111) | |||||||
Net income (loss) | (2,000) | 5,700 | 2,100 | 7,300 | 11,100 | 4,500 | (29,074) | 35,775 | 35,521 | |
Reconciliation of net income (loss) to net cash provided by operating activities: | ||||||||||
Depreciation | 10,396 | 10,100 | 9,578 | |||||||
Impairment and other charges | 59,883 | 0 | 0 | |||||||
Amortization of intangible assets | 12,287 | 15,074 | 16,586 | |||||||
Bad debt expense | 1,194 | 139 | 2,368 | |||||||
Payment of contingent consideration liability in excess of acquisition-date fair value | (136) | (106) | 0 | |||||||
Amortization of debt issuance costs | 1,875 | 1,875 | 1,743 | |||||||
Fair value adjustment on contingent consideration | (395) | 54 | 313 | |||||||
Loss on extinguishment and modification of debt | 2,288 | 0 | 60 | |||||||
Gain on sale of property and equipment | 0 | (9) | (1,330) | |||||||
Stock compensation expense | 3,532 | 1,963 | 2,549 | |||||||
Deferred income taxes | (14,771) | 1,110 | 1,004 | |||||||
Changes in operating assets and liabilities | ||||||||||
Trade accounts receivable | 42,909 | 5,560 | (22,487) | |||||||
Costs and estimated profits in excess of billings | 14,009 | 92 | (5,640) | |||||||
Inventories | 22,208 | (14,447) | (20,838) | |||||||
Prepaid expenses and other assets | 13,053 | 5,110 | 188 | |||||||
Accounts payable and accrued expenses | (14,897) | (15,408) | 7,093 | |||||||
Billings in excess of costs & estimated profits | (7,816) | 1,142 | 6,522 | |||||||
Other long-term liabilities | (8,870) | (6,718) | 2,610 | |||||||
Net cash provided by operating activities | 107,675 | 41,306 | 35,840 | |||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||
Purchase of property and equipment | (6,672) | (22,120) | (9,323) | |||||||
Proceeds from the sale of property and equipment | 123 | 35 | 2,558 | |||||||
Acquisition of businesses | (115,247) | 0 | (10,811) | |||||||
Net cash used in investing activities | (121,796) | (22,085) | (17,576) | |||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||
Proceeds from debt | 330,000 | 0 | 0 | |||||||
Principal debt payments | (244,375) | (4,341) | (3,381) | |||||||
Debt issuance costs | (7,268) | 0 | (60) | |||||||
Issuance of Common Stock- shares sold in public market | 1,142 | 0 | 0 | |||||||
Payment for contingent consideration liability | (1,864) | (1,394) | 0 | |||||||
Non-controlling interest holder contributions (distributions), net of tax benefits | 0 | 0 | 950 | |||||||
Preferred dividends paid | (90) | (90) | (90) | |||||||
Payment for employee taxes withheld from stock awards | (139) | (267) | (340) | |||||||
Net cash provided by (used in) financing activities | 77,406 | (6,092) | (2,921) | |||||||
Effect of foreign currency on cash | (168) | 679 | (403) | |||||||
Net Change In Cash | 63,117 | 13,808 | 14,940 | |||||||
Cash, cash equivalents and restricted cash at Beginning of Year | $ 54,327 | $ 40,519 | $ 25,579 | 54,327 | 40,519 | 25,579 | $ 25,579 | |||
Cash, cash equivalents and restricted cash at End of Year | $ 117,444 | $ 54,327 | $ 40,519 | 117,444 | 54,327 | 40,519 | $ 117,444 | |||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||||
Cash paid for interest | 13,321 | 17,623 | 19,134 | |||||||
Cash paid for income taxes | $ 6,277 | $ 13,318 | $ 8,301 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common Stock | Paid-in Capital | Retained earnings | Treasury stock | Non controlling interest | Accum Other Comp (Loss) | Series A preferred stock | Series B preferred Stock |
Beginning Balance at Dec. 31, 2017 | $ 268,546 | $ 174 | $ 153,087 | $ 134,193 | $ 0 | $ 567 | $ (19,491) | $ 1 | $ 15 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Dividends paid | (90) | (90) | |||||||
Compensation expense for restricted stock | 2,549 | 2,549 | |||||||
Tax related items for share based awards | (340) | (340) | |||||||
Issuance of shares of common stock | 894 | 894 | |||||||
Non-controlling interest holder contributions, net of tax benefits | 950 | 950 | |||||||
Cumulative translation adjustment | 224 | 224 | |||||||
Net income (loss) | 35,521 | 35,632 | (111) | ||||||
Ending Balance at Dec. 31, 2018 | 308,254 | 174 | 156,190 | 169,735 | 0 | 1,406 | (19,267) | 1 | 15 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Dividends paid | (90) | (90) | |||||||
Compensation expense for restricted stock | 1,963 | 1,963 | |||||||
Tax related items for share based awards | (267) | (267) | |||||||
Cumulative translation adjustment | (687) | (687) | |||||||
Net income (loss) | 35,775 | 36,035 | (260) | ||||||
Ending Balance at Dec. 31, 2019 | 344,948 | 174 | 157,886 | 205,680 | 0 | 1,146 | (19,954) | 1 | 15 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Dividends paid | (90) | (90) | |||||||
Compensation expense for restricted stock | 3,532 | 3,532 | |||||||
Tax related items for share based awards | (139) | (139) | |||||||
Issuance of shares of common stock | 1,142 | 1,142 | |||||||
Issuance of shares of common stock-Acquisition | 29,366 | 15 | 29,351 | ||||||
Cumulative translation adjustment | (1,819) | 296 | (227) | (1,888) | |||||
Net income (loss) | (29,074) | (28,726) | (348) | ||||||
Ending Balance at Dec. 31, 2020 | $ 347,866 | $ 189 | $ 192,068 | $ 176,637 | $ 0 | $ 798 | $ (21,842) | $ 1 | $ 15 |
THE COMPANY
THE COMPANY | 12 Months Ended |
Dec. 31, 2020 | |
THE COMPANY [Abstract] | |
THE COMPANY | THE COMPANY DXP Enterprises, Inc. together with its subsidiaries (collectively “DXP,” “Company,” “us,” “we,” or “our”) was incorporated in Texas on July 26, 1996. DXP Enterprises, Inc. and its subsidiaries are engaged in the business of distributing maintenance, repair and operating (MRO) products, and service to energy and industrial customers. Additionally, DXP provides integrated, custom pump skid packages, pump remanufacturing and manufactures branded private label pumps to energy and industrial customers. The Company is organized into three business segments: Service Centers (“SC”), Supply Chain Services (“SCS”) and Innovative Pumping Solutions (“IPS”). See Note 21 - Segment and Geographical Reporting for discussion of the business segments. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES Basis of Presentation The Company’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and its variable interest entity (“VIE”). DXP is the primary beneficiary of a VIE in which DXP owns 47.5% of the equity. DXP consolidates the financial statements of the VIE with the financial statements of DXP. As of December 31, 2020, the total assets of the VIE were approximately $4.8 million including approximately $3.4 million of fixed assets. DXP is the primary customer of the VIE. Consolidation of the VIE increased cost of sales by approximately $0.8 million for the year ended December 31, 2020 and decreased cost of sales by approximately $0.4 million for the year ended December 31, 2019, respectively. The Company recognized a related income tax benefit of $116 thousand and $83 thousand related to the VIE for the years ended December 31, 2020 and December 31, 2019, respectively. As of December 31, 2020, the owners of the 52.5% of the equity not owned by DXP included employees of DXP. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year presentation; none affected net income. Foreign Currency The financial statements of the Company’s Canadian subsidiaries are measured using local currencies as their functional currencies. Assets and liabilities are translated into U.S. dollars at current exchange rates, while income and expenses are translated at average exchange rates. Translation gains and losses are reported in other comprehensive income (loss). Gains and losses on transactions denominated in foreign currency are reported in the consolidated statements of operations and comprehensive income (loss). Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In the opinion of management, all adjustments necessary in order to make the financial statements not misleading have been included. Actual results could differ from those estimates. Cash and Cash Equivalents The Company’s presentation of cash includes cash equivalents. Cash equivalents are defined as short-term investments with maturity dates of 90 days or less at time of purchase. The Company places its cash and cash equivalents with institutions with high credit quality. However, at certain times, such cash and cash equivalents may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not historically experienced any losses when in excess of these limits. Receivables and Credit Risk Trade receivables consist primarily of uncollateralized customer obligations due under normal trade terms, which usually require payment within 30 days of the invoice date. However, these payment terms are extended in select cases and customers may not pay within stated trade terms. The Company has trade receivables from a diversified customer base located primarily in the Rocky Mountain, Northeastern, Midwestern, Southeastern and Southwestern regions of the United States and Canada. The Company believes no significant concentration of credit risk exists. The Company evaluates the creditworthiness of its customers' financial positions and monitors accounts on a regular basis. Provisions to the allowance for doubtful accounts are made monthly and adjustments are made periodically (as circumstances warrant) based upon management’s best estimate of the collectability of such accounts under the current expected credit losses model. The Company writes-off uncollectible trade accounts receivable when the accounts are determined to be uncollectible. No customer represents more than 10% of consolidated sales. Changes in this allowance for 2020, 2019 and 2018 were as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Balance at beginning of year $ 8,929 $ 10,126 $ 9,015 Charged to costs and expenses 1,194 139 2,368 Charged to other accounts 21 (1) 79 (1) (86) (2) Deductions (1,516) (3) (1,415) (3) (1,171) (3) Balance at end of year $ 8,628 $ 8,929 $ 10,126 (1) Primarily due to translation adjustments (2) Includes allowance for doubtful accounts from acquisitions and divestiture (3) Uncollectible accounts written off, net of recoveries Inventories Inventories consist principally of equipment purchased for resale or finished goods and are priced at net realizable value, cost being primarily determined using the weighted average cost method. The Company regularly reviews inventory to evaluate continued demand and records provisions for the difference between cost and net realizable value arising from excess and obsolete items on hand. Provisions are provided against inventories for estimated excess and obsolescence based upon the aging of the inventories and market trends and are applied as a reduction in cost of the associated inventory. Property and Equipment Property and equipment are carried on the basis of cost. Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives. Maintenance and repairs of depreciable assets are charged against earnings as incurred. When properties are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and gains or losses are credited or charged to earnings. The principal estimated useful lives used in determining depreciation are as follows: Buildings 20-39 years Building improvements 10-20 years Furniture, fixtures and equipment 3-20 years Leasehold improvements Shorter of estimated useful life or related lease term Impairment of Goodwill and Other Intangible Assets The Company tests goodwill and other indefinite lived intangible assets for impairment on an annual basis in the fourth quarter and when events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company assigns the carrying value of these intangible assets to its "reporting units" and applies the test for goodwill at the reporting unit level. A reporting unit is defined as an operating segment or one level below a segment (a "component") if the component is a business and discrete information is prepared and reviewed regularly by segment management. The Company’s goodwill impairment assessment first permits evaluating qualitative factors to determine if a reporting unit's carrying value would more likely than not exceed its fair value. If the Company concludes, based on the qualitative assessment, that a reporting unit's carrying value would more likely than not exceed its fair value, the Company would perform a quantitative test for that reporting unit. Should the reporting unit's carrying amount exceed the fair value, then an impairment charge for the excess would be recognized. The impairment charge is limited to the amount of goodwill allocated to the reporting unit, and goodwill will not be reduced below zero. For the twelve months ended December 31, 2020, goodwill was evaluated for impairment at the reporting unit level resulting in a $36.4 million goodwill impairment which was included in impairment charges in the consolidated statement of operations (see Note 4 - Im pairments and other charges Impairment of Long-Lived Assets, Excluding Goodwill The Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. For the twelve months ended December 31, 2020, long-lived assets was evaluated for impairment at the reporting unit level resulting in a $4.8 million long-lived assets impairment which was included in impairment charges in the consolidated statement of operations (see Note 4 - Impairments and other charges ). Revenue Recognition The Company fabricates and assembles custom-made pump packages, remanufactures pumps and manufactures branded private label pumps within our Innovative Pumping Solutions segment. For binding agreements to fabricate tangible assets to customer specifications, the Company recognizes revenues over time when the customer is able to direct the use of and obtain substantially all of the benefits of the work performed. This typically occurs when the products have no alternative use for us and we have a right to payment for the work completed to date plus a reasonable profit margin. Contracts generally include cancellation provisions that require the customer to reimburse us for costs incurred through the date of cancellation. We recognize revenue for these contracts using the percentage of completion method, an "input method" as defined by the new standard. Under this method, revenues are recognized as costs are incurred and include estimated profits calculated on the basis of the relationship between costs incurred and total estimated costs at completion. If at any time expected costs exceed the value of the contract, the loss is recognized immediately. The typical time span of these contracts is approximately one to two years. The Service Centers segment provides a wide range of maintenance, repair and operating (MRO) products, equipment and integrated services, including logistics capabilities, to industrial customers. The Supply Chain Services segment provides a wide range of MRO products and manages all or part of a customer's supply chain, including warehouse and inventory management services. Revenue is recognized upon the completion of our performance obligation(s) under the sales agreement. The majority of the Service Centers and Supply Chain Services segment revenues originate from the satisfaction of a single performance obligation, the delivery of products. Revenues are recognized when an agreement is in place, the performance obligations under the contract have been identified, and the price or consideration to be received is fixed and allocated to the performance obligation(s) in the contract. We believe our performance obligation has been satisfied when title passes to the customer or services have been rendered under the contract. Revenues are recorded net of sales taxes. The Company reserves for potential customer returns based upon the historical level of returns. Shipping and Handling Costs The Company classifies shipping and handling charges billed to customers as sales. Shipping and handling charges paid to others are classified as a component of cost of sales. Self-insured Insurance and Medical Claims We generally retain up to $100,000 of risk for each claim for workers compensation, general liability, automobile and property loss. We accrue for the estimated loss on the self-insured portion of these claims. The accrual is adjusted quarterly based upon reported claims information. The actual cost could deviate from the recorded estimate. We generally retain up to $175,000 of risk on each medical claim for our employees and their dependents with the exception of less than 0.05% of employees where a higher risk is retained. We accrue for the estimated outstanding balance of unpaid medical claims for our employees and their dependents. The accrual is adjusted monthly based on recent claims experience. The actual claims could deviate from recent claims experience and be materially different from the reserve. The accrual for these claims at December 31, 2020 and 2019 was approximately $2.6 million and $2.5 million, respectively. Cost of Sales and Selling, General and Administrative Expense Cost of sales includes product and product related costs, inbound freight charges, internal transfer costs and depreciation. Selling, general and administrative expense includes purchasing and receiving costs, inspection costs, warehousing costs, depreciation and amortization. Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and income tax bases of assets and liabilities. Such deferred income tax asset and liability computations are based on enacted tax laws and rates applicable to periods in which the differences are expected to reverse. Valuation allowances are established to reduce deferred income tax assets to the amounts expected to be realized under a more likely than not criterion. Accounting for Uncertainty in Income Taxes A position taken or expected to be taken in a tax return is recognized in the financial statements when it is more likely than not (i.e. a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states. With few exceptions, the Company is no longer subject to U.S. federal, state and local tax examination by tax authorities for years prior to 2014. The Company's policy is to recognize interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. The Company believes that it has appropriate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. Comprehensive Income (Loss) |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
RECENT ACCOUNTING PRONOUNCEMENTS | RECENT ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements Intangibles-Goodwill and Other . In August 2018, the FASB issued ASU No. 2018-15, Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract based on a consensus of the FASB’s Emerging Issues Task Force (EITF) that requires implementation costs incurred by customers in cloud computing arrangements (CCAs) to be deferred and recognized over the term of the arrangement, if those costs would be capitalized by the customer in a software licensing arrangement under the internal-use software guidance in ASC 350-40, “Intangibles-Goodwill and Other-Internal-Use Software”. The ASU does not affect the accounting by cloud service providers, other software vendors or customers’ accounting for software licensing arrangements. The ASU requires companies to recognize deferred implementation costs to expense over the ‘term of the hosting arrangement’. Under the ASU, the term of the hosting arrangement comprises the non-cancellable period of the CCA plus any optional renewal periods that are reasonably certain to be exercised by the customer or for which exercise of the option is controlled by the vendor. The Company adopted the standard effective January 1, 2020. The standard did not have an impact on our results of operations. Fair Value Measurement. In August 2018, the FASB issued ASU 2018-13: Fair Value Measurement: Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement which eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The Company adopted the standard effective January 1, 2020. The standard did not have an impact on our results of operations. Measurement of Credit Losses on Financial Instruments . In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as later modified by ASUs 2018-19, 2019-04, 2019-05, 2019-11 and 2020-02. This ASU requires estimating all expected credit losses for certain types of financial instruments, including trade receivables and contract assets, held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. The Company adopted this ASU effective January 1, 2020 which resulted in an immaterial impact to beginning retained earnings. While the adoption of this ASU did not have a material impact on the Company's financial statements, it required changes to the Company’s process of estimating expected credit losses on trade receivables and contract assets. The Company carries its accounts receivable at their face amounts less an allowance for expected credit losses. The Company establishes an allowance for expected credit losses to present the net amount of accounts receivable expected to be collected. On a regular basis, the Company evaluates its accounts receivable and contract assets and establishes the allowance for expected credit losses based on a combination of specific customer circumstances (including slow pays and bankruptcies), as well as history of write-offs and collections, current credit conditions and micro and macro-economic forecasts. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This update provides optional expedients and exceptions for applying generally accepted accounting principles to certain contract modifications and hedging relationships that reference London Inter-bank Offered Rate (LIBOR) or another reference rate expected to be discontinued. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company is currently evaluating the potential impact of this ASU on the financial statements. All other new accounting pronouncements that have been issued but not yet effective are currently being evaluated and at this time are not expected to have a material impact on our financial position or results of operations. |
IMPAIRMENT AND OTHER CHARGES
IMPAIRMENT AND OTHER CHARGES | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block Supplement [Abstract] | |
IMPAIRMENTS AND OTHER CHARGES | IMPAIRMENTS AND OTHER CHARGES The Company tests goodwill for impairment at least annually or more frequently whenever events or circumstances occur indicating that it might be impaired. During the third quarter of 2020, the Company’s market capitalization and sales declined significantly driven by current macroeconomic and geopolitical conditions including the collapse of oil prices caused by both surplus production and supply as well as the decrease in demand caused by the COVID-19 pandemic. In addition, the uncertainty related to oil demand continued to have a significant impact on the investment and operating plans of many of our customers. Based on these events, the Company concluded that it was more likely than not that the fair values of certain of its reporting units were less than their carrying values. Therefore, the Company performed an interim goodwill impairment test. For the twelve months ended December 31, 2020, goodwill was evaluated for impairment at the reporting unit level. The Company had four goodwill reporting units: Service Centers, Innovative Pumping Solutions, Canada and Supply Chain Services. The Company determined the fair values of two reporting units with goodwill were below their carrying values, resulting in a $36.4 million goodwill impairment, which was included in impairment charges in the consolidated statement of operations. Innovative Pumping Solutions The oil and gas industry experienced unprecedented disruption during 2020 as a result of a combination of factors, including the substantial decline in global demand for oil caused by the COVID-19 pandemic and subsequent mitigation efforts. This disruption created a substantial surplus of oil and a decline in oil prices. West Texas Intermediate (WTI) oil spot prices decreased sharply during the first quarter of 2020 from a high of $63 per barrel in early January of 2020 to approximately $21 per barrel by the end of the first quarter of 2020. Although oil prices have recovered modestly, WTI oil spot prices averaged approximately $41 per barrel during the third quarter of 2020, which is approximately 28% less than the average price per barrel during 2019. The U.S. average rig count continued to decline in the third quarter of 2020, dropping 35% compared to the second quarter of 2020. These factors, along with the continued impact of COVID-19, constituted a triggering event in the third quarter and required an interim goodwill impairment analysis for our manufacturing reporting unit. With the adverse economic impacts discussed above and the uncertainty surrounding the COVID-19 pandemic, the results of the impairment test indicated that the carrying amount of the manufacturing reporting unit exceeded the estimated fair value of the reporting unit, and a full impairment of its remaining goodwill was required. Significant assumptions inherent in the valuation methodologies for goodwill impairment calculations include, but are not limited to, prospective financial information, growth rates, discount rates, inflationary factors, and the cost of capital. To evaluate the sensitivity of the fair value calculations for the reporting unit, the Company applied a hypothetical 100 bps reduction in the weighted average cost of capital, and separately, increased the revenue projections by 10 percent, holding other factors steady. Even with more favorable assumptions, the results of these sensitivity analyses led the Company to record a non-cash impairment charge of $16.0 million for goodwill during the twelve months ended December 31, 2020. Canada As a result of the reductions in capital spending for oil and gas producers and processors and the economic repercussions from the COVID-19 pandemic, we determined these events constituted a triggering event that required us to review the recoverability of our long-lived assets and perform an interim goodwill impairment assessment as of July 31, 2020. Our review resulted in the recording of impairments and other charges during the third quarter of 2020. As a result of our goodwill impairment assessments, we determined that the fair value of our Canadian reporting unit was lower than its net book value and, therefore, resulted in a partial goodwill impairment. The enterprise value of the Canadian reporting unit at July 31, 2020 was less than its carrying value by approximately 40 percent. This resulted in a partial goodwill impairment of $20.5 million for Canada. Per the impairment test and respective sensitivity analyses, it was noted that a decrease of approximately 480 basis points in the pre-tax discount rate and an approximately 150 basis points increase in our revenue long-term growth rate projections would cause the Canada business enterprise value to increase to the level of its carrying value and thus avoid a full impairment. Other Impairments and methodology The negative market indicators described above were triggering events that indicated that certain of the Company’s long-lived intangible and tangible assets and additional inventory items may also have been impaired. Recoverability testing indicated that certain long-lived assets and inventory were indeed impaired. The estimated fair value of these assets was determined to be below their carrying value. As a result, the Company recorded the following additional impairment and other charges as detailed in the table below: (in thousands) Twelve Months Ended December 31, 2020 Long-lived asset impairments $ 4,775 Goodwill impairments 36,435 Inventory and work-in-progress costs 18,673 Total impairment and other charges $ 59,883 The Company determined the fair value of both long-lived assets and goodwill primarily using the discounted cash flow method and in the case of goodwill, a multiples-based market approach for comparable companies. Given the current volatile market environment and inherent complexities it presents, the Company utilized third-party valuation advisors to assist us with these valuations. These analyses included significant judgment, including management’s short-term and long-term forecast of operating performance, discount rates based on the weighted average cost of capital, as derived from peers, revenue growth rates, profitability margins, capital expenditures, the timing of future cash flows based on an eventual recovery of the oil and gas industry, and in the case of long-lived assets, the remaining useful life and service potential of the asset, all of which were classified as Level 3 inputs under the fair value hierarchy. These impairment assessments incorporate inherent uncertainties, including supply and demand for the Company’s products and services and future market conditions, which are difficult to predict in volatile economic environments. The discount rates utilized to value the reporting units were in a range from 14.8 percent to 16.4 percent. Given the dynamic nature of the COVID-19 pandemic and related market conditions, we cannot reasonably estimate the period that these events will persist or the full extent of the impact they will have on our business. If market conditions continue to deteriorate, including crude oil prices further declining or remaining at low levels for a sustained period, we may record further asset impairments, which may include an impairment of the carrying value of our goodwill associated with other reporting units. For inventory and work-in-progress we evaluated the recoverability based upon their net realizable value, factoring in the costs to complete work-in-progress and the salability of inventory items primarily tied to oil and gas. The net realizable value was derived from quotes for similar items and recent transactions. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
LEASES | LEASES We lease office space, warehouses, land, automobiles, and office and manufacturing equipment. All of our leases are classified as operating leases. Our leases have remaining lease terms of 1 month to 10 years, some of which include options to extend the leases for up to 14 years. The exercise of lease renewal options is at our sole discretion. Our lease agreements do not include options to purchase the leased property. The Company adopted the provisions of ASC 842, "Leases" effective January 1, 2019. We elected to apply the current period transition approach as introduced by ASU 2018-11 for our transition at January 1, 2019 and we elected to apply the following practical expedients and accounting policy decisions. In January 2019, we recorded a ROU Asset and total lease liability obligations of $72.7 million and $72.4 million, respectively. The new standard did not have a material impact on our consolidated statements of operations and had no impact on cash flows. The lease expenses were as follows (in thousands) : Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Lease cost Classification Short-term lease expense SG&A expenses (*) $ 374 $ 1,087 Other operating lease cost SG&A expenses (*) 22,983 23,911 Total operating lease cost $ 23,357 $ 24,998 (*) Manufacturing equipment and some vehicle rental expenses are included in the cost of sales. Supplemental cash flow information related to leases was as follows (in thousands) : Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Lease Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 18,250 $ 19,020 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 5,639 $ 12,608 Supplemental balance sheet information related to leases was as follows (in thousand) : Lease Classification December 31, 2020 December 31, 2019 Assets Operating Operating lease right-of-use assets $ 55,188 $ 66,191 Liabilities Current operating Short-term operating lease liabilities 15,891 17,603 Non-current operating Long-term operating lease liabilities 38,010 48,605 Total operating lease liabilities $ 53,901 $ 66,208 Note: As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments for lease commenced on or after January 1, 2019. We used our incremental borrowing rate as of the transition date of January 1, 2019 for operating leases that commenced prior to transition. Maturities of lease liabilities were as follows (in thousands) : Year Ending December 31, Operating leases (*) 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total lease payments $ 63,023 Less: imputed interest 9,122 Present value of lease liabilities $ 53,901 (*) Operating lease payments exclude $2.8 million and $1.1 million of legally binding minimum lease payments for leases signed but not yet commenced, as of December 31, 2020 and December 31, 2019, respectively. Lease term and discount rate Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Weighted average remaining lease term (years) Operating lease 4.29 4.74 Weighted average discount rate Operating lease 7.2% 7.3% For the twelve months ended December 31, 2020, the Company paid approximately $3.1 million in lease expenses to entities controlled by the Company's Chief Executive Officer, David Little and family. |
FAIR VALUE OF FINANCIAL ASSETS
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES | FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES Authoritative guidance for financial assets and liabilities measured on a recurring basis applies to all financial assets and financial liabilities that are being measured and reported on a fair value basis. Fair value, as defined in the authoritative guidance, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance affects the fair value measurement of an investment with quoted market prices in an active market for identical instruments, which must be classified in one of the following categories: Level 1 Inputs Level 1 inputs come from quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 Inputs Level 2 inputs are other than quoted prices that are observable for an asset or liability. These inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from, or corroborated by, observable market data by correlation or other means. Level 3 Inputs Level 3 inputs are unobservable inputs for the asset or liability which require the Company's own assumptions. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. Our acquisitions may include contingent consideration as part of the purchase price. The fair value of the contingent consideration is estimated as of the acquisition date based on the present value of the contingent payments to be made using a weighted probability of possible payments. The unobservable inputs used in the determination of the fair value of the contingent consideration include managements assumptions about the likelihood of payment based on the established benchmarks and discount rates based on an internal rate of return analysis. The fair value measurement includes inputs that are Level 3 inputs as discussed above, as they are not observable in the market. Should actual results increase or decrease as compared to the assumptions used in our analysis, the fair value of the contingent consideration obligations will increase or decrease, up to the contracted limit, as applicable. Changes in the fair value of the contingent earn-out consideration are measured each reporting period and reflected in our results of operations. As of December 31, 2020, we recorded a $1.1 million liability for contingent consideration associated with the acquisition of ASI in other current liabilities. See further discussion at Note 17 - Business Acquisitions . For the Company's assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balances for each category therein, and gains or losses recognized during the twelve months ended December 31, 2020: Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Contingent Liability for Accrued Consideration (in thousands) Beginning balance at December 31, 2019 $ 2,705 Acquisitions and settlements Acquisitions ( Note 17 ) — Settlements (2,000) Total remeasurement adjustments: Changes in fair value recorded in other (income) expense, net 395 Ending balance at December 31, 2020 $ 1,100 The amount of total (gains) or losses for the year included in earnings or changes to net assets, attributable to changes in unrealized (gains) or losses relating to assets or liabilities still held at year-end. 395 * Included in other current liabilities Quantitative Information about Level 3 Fair Value Measurements The significant unobservable inputs used in the fair value measurement of the Company's contingent consideration liabilities designated as Level 3 are as follows: (in thousands, unaudited) Fair Value at December 31, 2020 Valuation Technique Significant Unobservable Inputs Contingent consideration: (ASI acquisition) $ 1,100 Discounted cash flow Annualized EBITDA and probability of achievement Sensitivity to Changes in Significant Unobservable Inputs As presented in the table above, the significant unobservable inputs used in the fair value measurement of contingent consideration related to the acquisition of ASI are annualized EBITDA forecasts developed by the Company's management and the probability of achievement of those EBITDA results. The discount rate used in the calculation was 7.9%. Significant increases (decreases) in these unobservable inputs in isolation would result in a significantly (lower) higher fair value measurement. Other financial instruments not measured at fair value on the Company's consolidated balance sheets at December 31, 2020 but which require disclosure of their fair values include: cash and cash equivalents, trade accounts receivable, trade accounts payable and accrued expenses, accrued payroll and related benefits, and the revolving line of credit and term loan debt under our syndicated credit agreement facility ( Note 11 ). The Company believes that the estimated fair value of such instruments at December 31, 2020 and December 31, 2019 approximates their carrying value as reported on the consolidated balance sheets. |
INVENTORIES
INVENTORIES | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES The carrying values of inventories were as follows ( in thousands ): December 31, 2020 December 31, 2019 Finished goods $ 114,029 $ 122,510 Work in process 8,519 19,721 Obsolescence reserve (25,477) (12,867) Inventories $ 97,071 $ 129,364 |
COSTS AND ESTIMATED PROFITS ON
COSTS AND ESTIMATED PROFITS ON UNCOMPLETED CONTRACTS | 12 Months Ended |
Dec. 31, 2020 | |
Contractors [Abstract] | |
COSTS AND ESTIMATED PROFITS ON UNCOMPLETED CONTRACTS | COSTS AND ESTIMATED PROFITS ON UNCOMPLETED CONTRACTS Under our customized pump production contracts in our IPS segment, amounts are billed as work progresses in accordance with agreed-upon contractual terms, upon various measures of performance, including achievement of certain milestones, completion of specified units, or completion of a contract. Generally, billing occurs subsequent to revenue recognition, resulting in contract assets. Our contract assets are presented as “Cost and estimated profits in excess of billings” on our Consolidated Balance Sheets. However, we sometimes receive advances or deposits from our customers before revenue is recognized, resulting in contract liabilities that are presented as “Billings in excess of costs and estimated profits” on our Consolidated Balance Sheets. Costs and estimated profits on uncompleted contracts and related amounts billed for 2020 and 2019 were as follows ( in thousands ): December 31, 2020 2019 Costs incurred on uncompleted contracts $ 36,969 $ 51,017 Estimated profits, thereon 6,711 10,771 Total $ 43,680 $ 61,788 Less: billings to date 29,315 41,223 Net $ 14,365 $ 20,565 Such amounts were included in the accompanying Consolidated Balance Sheets for 2020 and 2019 under the following captions ( in thousands ): December 31, 2020 2019 Costs and estimated profits in excess of billings $ 18,459 $ 32,455 Billings in excess of costs and estimated profits (4,061) (11,871) Translation Adjustment (33) (19) Net $ 14,365 $ 20,565 During the twelve months ended December 31, 2020, $11.9 million of the balances that were previously classified as contract liabilities at the beginning of the period shipped. Contract assets and liability changes were primarily due to normal activity and timing differences between our performance and customer payments. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT The carrying values of property and equipment were as follows ( in thousands ): December 31, 2020 December 31, 2019 Land $ 2,558 $ 1,960 Buildings and leasehold improvements 22,952 15,445 Furniture, fixtures and equipment 110,159 119,865 Less – Accumulated depreciation (78,770) (73,567) Total Property and Equipment $ 56,899 $ 63,703 Depreciation expense was $10.4 million, $10.1 million, and $9.6 million for the years ended December 31, 2020, 2019, and 2018, respectively. Capital expenditures by segment are included in Note 21 - Segment and Geographical Reporting . |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS The following table presents the changes in the carrying amount of goodwill and other intangible assets during the year ended December 31, 2020 ( in thousands ): Goodwill Other Total Balances as of December 31, 2019 $ 194,052 $ 52,582 $ 246,634 Translation adjustment — (4) (4) Acquisitions 90,722 39,797 130,519 Impairment (36,435) — (36,435) Amortization — (12,287) (12,287) Balances as of December 31, 2020 $ 248,339 $ 80,088 $ 328,427 The following table presents the changes in the carrying amount of goodwill and other intangible assets during the year ended December 31, 2019 ( in thousands ): Goodwill Other Total Balances as of December 31, 2018 $ 194,052 $ 67,207 $ 261,259 Translation adjustment — 449 449 Amortization — (15,074) (15,074) Balances as of December 31, 2019 $ 194,052 $ 52,582 $ 246,634 The following table presents the goodwill balance by reportable segment as of December 31, 2020 and 2019 (in thousands) : As of December 31, 2020 2019 Service Centers $ 231,200 $ 160,934 Innovative Pumping Solutions — 15,980 Supply Chain Services 17,139 17,138 Total $ 248,339 $ 194,052 The following table presents a summary of other intangible assets ( in thousands ): As of December 31, 2020 As of December 31, 2019 Gross Accumulated Carrying Gross Accumulated Carrying Customer relationships $ 193,747 $ (116,028) $ 77,719 $ 156,282 $ (103,796) $ 52,486 Non-compete agreements 2,617 (248) 2,369 285 (189) 96 Total $ 196,364 $ (116,276) $ 80,088 $ 156,567 $ (103,985) $ 52,582 Gross carrying amounts as well as accumulated amortization are partially affected by the fluctuation of foreign currency rates. Other intangible assets are amortized according to estimated economic benefits over their estimated useful lives. Customer relationships are amortized over their estimated useful lives. Amortization expense is recognized according to estimated economic benefits and was $12.3 million, $15.1 million, and $16.6 million for the years ended December 31, 2020, 2019, and 2018, respectively. The estimated future annual amortization of intangible assets for each of the next five years and thereafter are as follows (in thousands) : 2021 $ 15,564 2022 14,223 2023 12,504 2024 10,426 2025 9,023 Thereafter 18,348 Total $ 80,088 The weighted average remaining estimated life for customer relationships and non-compete agreements are 7.3 years and 4.9 years, respectively. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consisted of the following ( in thousands ): December 31, 2020 December 31, 2019 Carrying Value (1) Fair Value Carrying Value (1) Fair Value ABL Revolver $ — — $ — — Term Loan B 330,000 325,875 244,375 244,375 Total Debt 330,000 325,875 244,375 244,375 Less: Current maturities (3,300) (3,259) (2,500) (2,500) Total Long-term Debt $ 326,700 $ 322,616 $ 241,875 $ 241,875 (1) Carrying value amount do not include unamortized debt issuance costs of $9.6 million and $6.5 million for year ended December 31, 2020 and December 31, 2019 respectively. Asset-Based Loan Facility: On March 17, 2020, the Company entered into an Increase Agreement (the "Increase Agreement") that provided for a $135 million asset-backed revolving line of credit (the "ABL Revolver") a $50 million increase from the $85.0 million available under the original revolver. During the twelve months ended December 31, 2020, the amount available to be borrowed under our credit facility increased to $131.9 million compared to $81.6 million at December 31, 2019 primarily as a result of the above mentioned Increase Agreement offset by outstanding letters of credit. As of December 31, 2020, there were no amounts of ABL Loans outstanding under the ABL Revolver. The Company's consolidated Fixed Charge Coverage Ratio was 3.45 to 1.00 as of December 31, 2020. DXP was in compliance with all such covenants that were in effect on such date under the ABL Revolver as of December 31, 2020. The ABL Credit Agreement may be increased in increments of $10.0 million up to an aggregate of $50.0 million. The facility will mature on August 29, 2022. Interest accrues on outstanding borrowings at a rate equal to LIBOR or CDOR plus a margin ranging from 1.25% to 1.75% per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25% to 0.75% per annum, in each case, based upon the average daily excess availability under the facility for the most recently completed calendar quarter. Fees ranging from 0.25% to 0.375% per annum are payable on the portion of the facility not in use at any given time. The unused line fee was 0.375% at December 31, 2020. The interest rate for the ABL facility was 1.9% at December 31, 2020. Term Loan B: On December 23, 2020, DXP entered into a new seven year, $330 million Senior Secured Term Loan B (the “Term Loan B Agreement”), which replaced DXP’s previously existing Senior Secured Term Loan. The Term Loan B Agreement provides for a new $330 million term loan (the “Term Loan”) that amortizes in equal quarterly installments of 0.25% with the balance payable in December 2027, when the facility matures. Subject to securing additional lender commitments, the Term Loan B Agreement allows for incremental increases in facility size up to an aggregate of $52.5 million, plus an additional amount such that DXP’s Secured Leverage Ratio (as defined in the Term Loan B Agreement) would not exceed 3.75 to 1.00. Interest accrues on the Term Loan at a rate equal to the base rate plus a margin of 3.75% for the Base Rate Loans (as defined in the Term Loan B Agreement), or LIBOR plus a margin of 4.75% for the Eurodollar Rate Loans (as defined in the Term Loan B Agreement). We are required to repay the Term Loan with certain asset sales and insurance proceeds, certain debt proceeds and 50% of excess cash flow, if our total leverage ratio is no more than 3.00 to 1.00 and greater than 2.50 to 1:00, reducing to 25%, if our total leverage ratio is no more than 2.50 to 1.00. The interest rate for the Term Loan was 5.75% as of December 31, 2020. Financial Covenants: DXP’s principal financial covenants under the ABL Credit Agreement and Term Loan B Agreement include: Fixed Charge Coverage Ratio – The Fixed Charge Coverage Ratio under the ABL Credit Agreement is defined as the ratio for the most recently completed four-fiscal quarter period, of (a) EBITDA minus capital expenditures (excluding those financed or funded with debt (other than the ABL Loans), (ii) the portion thereof funded with the net proceeds from asset dispositions of equipment or real property which DXP is permitted to reinvest pursuant to the Term Loan and the portion thereof funded with the net proceeds of casualty insurance or condemnation awards in respect of any equipment and real estate which DXP is not required to use to prepay the ABL Loans pursuant to the Term Loan B Agreement or with the proceeds of casualty insurance or condemnation awards in respect of any other property) minus cash taxes paid (net of cash tax refunds received during such period), to (b) fixed charges. The Company is restricted from allowing its fixed charge coverage ratio be less than 1.00 to 1.00 during a compliance period, which is triggered when the availability under the ABL facility falls below a threshold set forth in the ABL Credit Agreement. As of December 31, 2020, the Company's consolidated Fixed Charge Coverage Ratio was 3.45 to 1.00. Secured Leverage Ratio – The Term Loan B Agreement requires that the Company’s Secured Leverage Ratio, defined as the ratio, as of the last day of any fiscal quarter of consolidated secured debt (net of unrestricted cash, not to exceed $150 million) as of such day to EBITDA, beginning with the fiscal quarter ending December 31, 2020, is either equal to or less than as indicated in the table below: Fiscal Quarter Secured Leverage Ratio December 31, 2020 5.75:1:00 March 31, 2021 5.75:1:00 June 30, 2021 5.75:1:00 September 30, 2021 5.50:1:00 December 31, 2021 5.50:1:00 March 31, 2022 5.25:1:00 June 30, 2022 5.25:1:00 September 30, 2022 5.25:1:00 December 31, 2022 5.00:1:00 March 31, 2023 5.00:1:00 June 30, 2023 and each Fiscal Quarter thereafter 4.75:1:00 EBITDA as defined under the Term Loan B Agreement for financial covenant purposes means, without duplication, for any period of determination, the sum of, consolidated net income during such period; plus to the extent deducted from consolidated net income in such period: (i) income tax expense, (ii) franchise tax expense, (iii) consolidated interest expense, (iv) amortization and depreciation during such period, (v) all non-cash charges and adjustments, and (vi) non-recurring cash expenses related to the Term Loan, provided , that if the Company acquires or disposes of any property during such period (other than under certain exceptions specified in the Term Loan B Agreement, including the sale of inventory in the ordinary course of business, then EBITDA shall be calculated, after giving pro forma effect to such acquisition or disposition, as if such acquisition or disposition had occurred on the first day of such period. As of December 31, 2020, the Company’s consolidated Secured Leverage Ratio was 3.24 to 1.00. In connection with the extinguishment of the previously existing term loan agreement we recorded a $2.3 million write-off of debt issuance costs, which was included in interest expense during 2020. Interest on Borrowings The interest rates on our borrowings outstanding at December 31, 2020 and 2019, including the amortization of debt issuance costs, were as follows: December 31, 2020 2019 ABL Revolver 1.9 % 3.5 % Term Loan B 5.75 % 6.5 % Weighted average interest rate 5.75 % 6.5 % The Company was in compliance with all financial covenants as of December 31, 2020. Extinguishment and modification of Previously Existing Credit Agreement As set forth above, on December 23, 2020, the Company terminated its previously existing credit agreement and replaced it with a new Term Loan and Security Agreement. The terminated agreement was under the previous Term Loan and Security Agreement dated as of August 29, 2017, by and among the Company, as borrower, and Goldman Sachs Bank USA, as issuing lender and administrative agent for other lenders (the “Original Credit Agreement”). This Original Credit Agreement was subsequently amended on June 25, 2018 (the “Original Term Loan Agreement”). The refinancing of the term loan involved multiple lenders who were considered members of a loan syndicate. In determining whether the refinancing was to be accounted for as a debt extinguishment or modification, we considered whether the lenders remained the same or changed and whether the change in debt terms was substantial. The debt terms would be considered substantially different if the present value of the cash inflows and outflows of the new term loans, including all principal increases and lender fees on the refinancing date, was at least 10% different from the present value of the remaining cash inflows and outflows of the original term loans, or the 10% Test. We performed a separate 10% Test for each individual lender participating in the loan syndication. For existing lenders who participated in the new term loans as part of the new loan syndicate, the refinancing was accounted for as a modification as the change in debt terms was determined to not be substantial using the 10% Test. Deferred financing costs of $3.0 million and an original issue discount of $4.1 million were associated with modified and new debt and will be amortized to interest expense using the interest method over the life of the term loans. In connection with the original lenders considered an extinguishment of the previously existing Term Loan and Security Agreement we recorded a $5.4 million write-off of debt issuance costs and third-party fees, which was included in interest expense during 2020. As of December 31, 2020, the maturities of long-term debt for the next five years and thereafter were as follows ( in thousands ): Year $ Amount 2021 $ 3,300 2022 3,300 2023 3,300 2024 3,300 2025 3,300 Thereafter 313,500 Total $ 330,000 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income (loss) before income taxes were as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Domestic $ (32,440) $ 41,184 $ 46,270 Foreign (15,075) 5,485 2,436 Total income before taxes $ (47,515) $ 46,669 $ 48,706 The provision for income taxes consisted of the following ( in thousands ): Years Ended December 31, 2020 2019 2018 Current - Federal $ (6,179) $ 4,940 $ 7,295 State (154) 1,862 2,257 Foreign 2,663 2,982 2,629 Total current $ (3,670) $ 9,784 $ 12,181 Deferred - Federal (10,568) 2,618 2,389 State (3,125) (224) 123 Foreign (1,078) (1,284) (1,508) Total deferred $ (14,771) $ 1,110 $ 1,004 Total current and deferred taxes $ (18,441) $ 10,894 $ 13,185 The difference between income taxes computed at the statutory income tax rate and the provision for income taxes is as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Income taxes computed at federal statutory rate $ (9,978) $ 9,801 $ 10,228 State income taxes, net of federal benefit (2,591) 1,294 1,880 Foreign taxes (492) 311 150 Nondeductible expenses 5,617 1,108 954 Enacted rate changes 670 — — Research and development tax credit (16,878) (2,324) (480) Foreign tax credit — (57) (346) Valuation allowance 16 (5) — Tax reform deferred tax remeasurement — — 81 Deferred tax liability true up (551) 1,065 — Uncertain tax positions 5,057 665 172 Other 689 (964) 546 Total income tax expense (benefit) $ (18,441) $ 10,894 $ 13,185 Deferred tax liabilities and assets were comprised of the following ( in thousands ): December 31, 2020 2019 Deferred tax assets: Allowance for doubtful accounts $ 1,784 $ 1,657 Inventory 7,073 3,254 Research and development credit carryforward 8,407 1,361 Foreign tax credit carryforward 64 64 Net operating loss carryforward 802 812 Capital loss carryforward 12,813 12,363 Deferred compensation 540 — Accruals 5,690 4,077 Investment in partnerships 319 500 Other 312 — Total deferred tax assets $ 37,804 $ 24,088 Less valuation allowance (12,813) (12,363) Total deferred tax asset, net of valuation deferred tax liabilities : $ 24,991 $ 11,725 Goodwill (8,570) (8,459) Intangibles (8,512) (2,051) Property and equipment (7,569) (8,319) ROU asset and liability (323) — Unremitted foreign earnings (421) (421) Deferred compensation — (317) Method changes (754) (1,961) Other (619) (69) Net deferred tax liability $ (1,777) $ (9,872) The Company records a valuation allowance when it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of the deferred tax assets depends on the ability to generate sufficient taxable income of the appropriate character in the future and in the appropriate taxing jurisdictions. If the Company was to determine that it would be able to realize the deferred tax assets in the future in excess of their net recorded amount, the Company would make an adjustment to the valuation allowance, which would reduce the provision for income taxes. At December 31, 2020, the valuation allowance primarily relates to federal and foreign capital loss carryforwards. The following summarizes changes in the balance of valuation allowances on deferred tax assets (in thousands): Years Ended December 31, 2020 2019 2018 Balance at January 1 $ (12,363) $ (12,564) $ (12,220) Changes due to federal and foreign capital loss carryforwards (450) 201 (344) Balance at December 31 $ (12,813) $ (12,363) $ (12,564) Tax carryforwards available for use on future income tax returns, prior to valuation allowance, at December 31, 2020, were as follows (in thousands): Domestic Foreign Expiration Net operating loss - foreign $ — $ 414 2034 - 2040 Net operating loss - federal 388 — 2036 - 2040 Capital loss carryforward - foreign — 4 Indefinite Capital loss carryforward - federal 12,809 — 2021 Foreign tax credits 64 — 2023, 2025 Federal research and development tax credits 4,467 — 2026 - 2030 Texas research and development tax credits 3,700 — 2037 - 2040 Louisiana research and development tax credits 239 — 2024 - 2025 Changes in the balance of unrecognized tax benefits excluding interest and penalties on uncertain tax positions were as follows (in thousands): Assets (Liabilities) 2020 2019 2018 Balance at January 1 $ — $ — $ — Increases related to prior year tax positions (5,057) — — Decreases related to prior year tax positions — — — Increases related to current year tax positions — — — Settlements — — — Lapse of statute of limitations — — — Balance at December 31 $ (5,057) $ — $ — As of December 31, 2020, the Company had recorded a total tax benefit of $16.9 million related to federal and state research and development tax credits. This benefit is partially offset by $5.1 million uncertain tax position due to the uncertainty related to the realizability of the federal research and development tax credits. To the extent penalties and interest would be assessed on any underpayment of income tax, such accrued amounts are classified as a component of income tax provision (benefit) in the consolidated financial statements consistent with Company's policy. For the year ended December 31, 2020, the Company did not record any tax expense for interest and penalties related to uncertain tax positions. The Company is subject to taxation in the United States, various states, and foreign jurisdictions. The Company has significant operations in the United States and Canada and to a lesser extent in various other international jurisdictions. Tax years that remain subject to examination vary by legal entity but are generally open in the United States for the tax years ended after 2012 and outside the United States for the tax years ended after 2012. |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION Restricted Stock We issued equity-based awards from the 2016 Omnibus Plan. 2016 Omnibus Incentive Plan On June 19, 2019, our shareholders approved an amendment to the DXP Enterprises, Inc. 2016 Omnibus Incentive Plan (the “2016 Plan”) to increase the number of shares that can be issued under the 2016 Plan from 500,000 shares to a total of 1,000,000 shares, which represents an increase of 500,000 shares (the “Amendment”), which authorized grants of restricted stock awards, restricted stock units (“RSUs”), performance awards, options, investment rights, and cash-based awards. This plan authorizes the issuance of up to 1,000,000 shares of our common stock. Under the 2016 Omnibus Plan approved by our shareholders, directors, consultants and employees may be awarded shares of DXP’s common stock. The shares of restricted stock awards granted to employees that are outstanding as of December 31, 2020 vest in accordance with one of the following vesting schedules: 100% one year after the grant date; 50% each year for two years after the grant; 33.3% each year for three years after the grant date; 20% each year for five years after the grant date; or 10% each year for ten years after the date of grant. The shares of restricted stock awards granted to non-employee directors of DXP vest one year after the grant date. The fair value of restricted stock awards is measured based upon the closing prices of DXP’s common stock on the grant dates and is recognized as compensation expense over the vesting period of the awards. Once restricted stock vests, new shares of the Company’s stock are issued. At December 31, 2020, 612,692 shares were available for future grant. Changes in restricted stock awards for the twelve months ended December 31, 2020 were as follows: Number of Weighted Average Non-vested at December 31, 2019 144,250 $ 32.71 Granted 100,299 $ 30.91 Forfeited (16,794) $ 28.61 Vested (60,779) $ 31.33 Non-vested at December 31, 2020 166,976 $ 32.53 Changes in restricted stock awards for the twelve months ended December 31, 2019 were as follows: Number of Weighted Average Non-vested at December 31, 2018 169,293 $ 31.05 Granted 46,885 $ 35.60 Forfeited (5,720) $ 32.35 Vested (66,208) $ 27.75 Non-vested at December 31, 2019 144,250 $ 32.71 Changes in restricted stock awards for the twelve months ended December 31, 2018 were as follows: Number of Weighted Average Non-vested at December 31, 2017 77,901 $ 30.36 Granted 131,413 $ 31.92 Forfeited (2,400) $ 46.68 Vested (37,621) $ 31.68 Non-vested at December 31, 2018 169,293 $ 31.05 |
EARNINGS PER SHARE DATA
EARNINGS PER SHARE DATA | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE DATA | EARNINGS PER SHARE DATA Basic earnings per share is computed based on weighted average shares outstanding and excludes dilutive securities. Diluted earnings per share is computed including the impacts of all potentially dilutive securities. The following table sets forth the computation of basic and diluted earnings per share for the periods indicated ( in thousands, except per share data ): December 31, 2020 2019 2018 Basic: Weighted average shares outstanding 17,748 17,592 17,553 Net income (loss) attributable to DXP Enterprises, Inc. $ (28,726) $ 36,035 $ 35,632 Convertible preferred stock dividend (90) (90) (90) Net income (loss) attributable to common shareholders $ (28,816) $ 35,945 $ 35,542 Per share amount $ (1.62) $ 2.04 $ 2.02 Diluted: Weighted average shares outstanding 17,748 17,592 17,553 Assumed conversion of convertible preferred stock — 840 840 Total dilutive shares 17,748 18,432 18,393 Net income (loss) attributable to common shareholders $ (28,816) $ 35,945 $ 35,542 Convertible preferred stock dividend — 90 90 Net income (loss) attributable to DXP Enterprises, Inc. $ (28,816) $ 36,035 $ 35,632 Per share amount $ (1.62) $ 1.96 $ 1.94 Basic earnings per share have been computed by dividing net earnings by the weighted average number of common shares outstanding during the period and excludes dilutive securities. Diluted earnings per share reflects the potential dilution that could occur if the preferred stock was converted into common stock. Restricted stock is considered a participating security and is included in the computation of basic earnings per share as if vested.The preferred stock is convertible into 840,000 shares of common stock. For the twelve months ended December 31, 2020, we excluded from the diluted EPS calculation 840,000 convertible preferred shares, respectively, since the effect would have been antidilutive. |
CAPITAL STOCK
CAPITAL STOCK | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
CAPITAL STOCK | CAPITAL STOCK The Company has Series A and Series B preferred stock of 1,122 shares and 15,000 shares outstanding as of December 31, 2020, 2019 and 2018, respectively. The preferred stock did not have any activity during 2020, 2019 and 2018. Series A Preferred Stock The holders of Series A preferred stock are entitled to one-tenth of a vote per share on all matters presented to a vote of shareholders generally, voting as a class with the holders of common stock, and are not entitled to any dividends or distributions other than in the event of a liquidation of the Company, in which case the holders of the Series A preferred stock are entitled to $100 liquidation preference per share. Series B Preferred Stock Each share of the Series B convertible preferred stock is convertible into 56 shares of common stock and a monthly dividend per share of $.50. The holders of the Series B convertible stock are entitled to a $100 liquidation preference per share after payment of the distributions to the holders of the Series A preferred stock and to one-tenth of a vote per share on all matters presented to a vote of shareholders generally, voting as a class with the holders of the common stock. The activity related to outstanding common stock and common stock held in treasury was as follows: December 31, 2020 2019 2018 Common Stock: Quantity (in thousands) Balance, beginning of period 17,460 17,401 17,316 Issuance of shares for compensation net of withholding 54 59 85 Issuance of common stock related to equity distribution agreements 46 — — Issuance of common stock related to purchase of businesses 1,481 — — Balance, end of period 19,041 17,460 17,401 There were not any treasury shares outstanding for the years ended 2020, 2019 and 2018. |
SALES OF COMMON STOCK
SALES OF COMMON STOCK | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
SALES OF COMMON STOCK | CAPITAL STOCK The Company has Series A and Series B preferred stock of 1,122 shares and 15,000 shares outstanding as of December 31, 2020, 2019 and 2018, respectively. The preferred stock did not have any activity during 2020, 2019 and 2018. Series A Preferred Stock The holders of Series A preferred stock are entitled to one-tenth of a vote per share on all matters presented to a vote of shareholders generally, voting as a class with the holders of common stock, and are not entitled to any dividends or distributions other than in the event of a liquidation of the Company, in which case the holders of the Series A preferred stock are entitled to $100 liquidation preference per share. Series B Preferred Stock Each share of the Series B convertible preferred stock is convertible into 56 shares of common stock and a monthly dividend per share of $.50. The holders of the Series B convertible stock are entitled to a $100 liquidation preference per share after payment of the distributions to the holders of the Series A preferred stock and to one-tenth of a vote per share on all matters presented to a vote of shareholders generally, voting as a class with the holders of the common stock. The activity related to outstanding common stock and common stock held in treasury was as follows: December 31, 2020 2019 2018 Common Stock: Quantity (in thousands) Balance, beginning of period 17,460 17,401 17,316 Issuance of shares for compensation net of withholding 54 59 85 Issuance of common stock related to equity distribution agreements 46 — — Issuance of common stock related to purchase of businesses 1,481 — — Balance, end of period 19,041 17,460 17,401 There were not any treasury shares outstanding for the years ended 2020, 2019 and 2018. |
BUSINESS ACQUISITIONS
BUSINESS ACQUISITIONS | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
BUSINESS ACQUISITIONS | BUSINESS ACQUISITIONS On December 31, 2020, the Company completed the acquisition of Total Equipment Company, Inc. (“TEC”), a distributor of industrial and commercial pumps and air compressors focused on serving multiple end markets including steel, chemicals, water / wastewater, oil & gas and general industrial markets. The Company paid approximately $64.7 million in cash and stock. On December 31, 2020, the Company completed the acquisition of APO Pumps & Compressors (“APO”), a distributor of industrial and commercial pumps and air compressors focused on serving multiple end markets including the water / wastewater, steel, food & beverage, and general industrial markets. The Company paid approximately $38.3 million in cash and stock. On December 31, 2020, the Company completed the acquisition of Pumping Solutions, Inc. (“Pumping Solutions”), a distributor of industrial and commercial pumps and process equipment focused on serving multiple end markets including the water / wastewater, chemical, food & beverage, and general industrial markets. The Company paid approximately $21.0 million in cash and stock. On December 31, 2020, the Company completed the acquisition of Corporate Equipment Company (“CEC”), a distributor of industrial and commercial pumps and air compressors focused on serving multiple end markets including the water / wastewater, steel, food & beverage, and general industrial markets. The Company paid approximately $4.5 million in cash and stock. On February 1, 2020, the Company completed the acquisition of substantially all of the assets of Turbo Machinery Repair (“Turbo”), a pump and industrial equipment repair, maintenance, machining and labor services company. The Company paid approximately $3.2 million in cash. On January 1, 2020, the Company completed the acquisition of Pumping Systems, Inc. (“PSI”), a distributor of pumps, systems and related services. The PSI acquisition was funded with a mixture of cash on hand as well as issuing DXP's common stock. The PSI acquisition was funded with a mixture of cash on hand as well as issuing DXP's common stock. The Company paid approximately $13.0 million in cash and stock. The following table summarizes the total consideration for 2020 transferred to acquire these companies and in aggregate the amount of identified assets acquired and liabilities assumed at the acquisition dates. The Company is in the process of finalizing third-party valuations of certain intangible assets; thus, the provisional measurements of intangible assets, goodwill and deferred income tax liabilities are subject to change. In addition, the company continues to finalize inventory, ROU Assets and Liabilities as well as other assets acquired. As described above, the acquisitions of Pumping Systems Inc and Turbo Machinery Repair closed in January and February 2020, respectively. Since their acquisition, they have contributed approximately $19.6 million in revenue and $0.8 million in net income for the year ended December 31, 2020. None of these acquisitions were individually material. Two of these acquisitions, PSI and Turbo, contributed revenue and net income (loss) which comprised approximately 1.9% and (2.9)%, respectively, of the Company’s consolidated results for the year ended December 31, 2020. Purchase Price Consideration (in thousands) Total Consideration Cash payments $ 115,247 Fair value of stock issued (1,480,909 shares) 29,367 Total consideration transferred $ 144,614 Cash $ 1 Accounts Receivable 20,204 Inventory 8,567 Other Current Assets 190 Property and equipment 1,811 Non-compete agreements 2,332 Customer relationships 37,465 Goodwill 90,722 Other assets 696 Assets acquired $ 161,988 Current liabilities assumed (10,674) Deferred tax liability (6,700) Net assets acquired $ 144,614 The following represents the pro forma unaudited revenue and earnings as if each of the six 2020 acquisitions had been included in the consolidated results of the Company for the full years ending December 31, 2020 and 2019, respectively: Years Ended December 31, 2020 2019 (in thousands/unaudited) Revenue $ 1,129,610 $ 1,423,805 Net income (loss) $ (15,148) $ 41,219 Individual pro forma results for each acquisition are not disclosed, as individually these acquisitions would not have a material impact on the Company's financial statements. The fair value of the 1,480,909 common shares issued was determined based on the closing market price of the Company’s common shares on the acquisition date, adjusted for holding restrictions following consummation. Of the $39.8 million of acquired intangible assets, $2.3 million was provisionally assigned to non-compete agreements that are subject to amortization over 5 years, coincident with the term of these arrangements. In addition, $37.5 million was provisionally assigned to customer relationships, and will be amortized over a period of 8 years. As noted earlier, the fair value of the acquired identifiable intangible assets is provisional pending completion of the final valuations for these assets. The $90.7 million of goodwill was assigned to the Service Centers segment. The goodwill recognized is attributable primarily to expected synergies and the assembled workforce of the acquirees. None of the goodwill is expected to be deductible for income tax purposes. As of December 31, 2020, the Company recognized additional goodwill of $463 thousand resulting from the acquisition of PSI and no additional goodwill for the acquisition Turbo which both closed in the First Quarter of 2020. The fair value of accounts receivables acquired is $20.2 million, with the gross contractual amounts of $21.1 million. The Company expects $0.9 million to be uncollectible. The Company recognized $172 thousand of acquisition related costs that were expensed in the current period. These costs are included in the consolidated income statement in Selling, General and Administrative costs. The Company also incurred and recognized an immaterial amount in costs associated with issuing the shares as additional consideration in the acquisitions. Those costs were deducted from the recognized proceeds of issuance within stockholders’ equity. Previous acquisition On January 1, 2018, the Company completed the acquisition of Application Specialties, Inc. ("ASI"), a distributor of cutting tools, abrasives, coolants and machine shop supplies. The Company paid approximately $11.7 million in cash and stock. The purchase price also included approximately $4.6 million in contingent consideration. The purchase was financed with $10.8 million of cash on hand as well as issuing $0.9 million of the Company's common stock. ASI provides the Company's metal working division with new geographic territory and enhances DXP's end market mix. As part of our purchase agreement, we were obligated to pay up to an additional $4.6 million of contingent consideration over three years based on the achievement of certain earnings benchmarks established for calendar years 2018, 2019 and 2020. The purchase price included the estimated fair value of the contingent consideration recorded at the present value of approximately $4.0 million. The estimated fair value of the contingent consideration was determined using a probability-weighted discounted cash flow model. We determined the fair value of the contingent consideration obligations by calculating the probability-weighted payments based on our assessment of the likelihood that the benchmarks will be achieved. The probability-weighted payments were then discounted using a discount rate based on an internal rate of return analysis using the probability-weighted cash flows. The fair value measurement includes earnings forecasts which are a Level 3 measurement as discussed in Note 6 - Fair Value of Financial Assets and Liabilities . The fair value of the contingent consideration is reviewed quarterly over the earn-out period to compare actual earnings before interest, taxes, depreciation and amortization ("EBITDA") achieved to the estimated EBITDA used in our forecasts. As of December 31, 2020, $1.1 million of the actual cash due toward the contingent consideration earned is recorded in current liabilities. The estimated fair value of the contingent consideration is recorded at the present value of $1.1 million at December 31, 2020. Changes in the estimated fair value of the contingent earn-out consideration, up to the total contractual amount, are reflected in our results of operations in the periods in which they are identified. Changes in the fair value of the contingent consideration may materially impact and cause volatility in our future operating results. Changes in our estimates for the contingent consideration are discussed in Note 6 - Fair Value of Financial Assets and Liabilities to our consolidated financial statements. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company leases equipment, automobiles and office facilities under various operating leases. The future minimum rental commitments as of December, 2020, for non-cancelable leases are as follows ( in thousands ): 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total $ 63,023 Rental expense for operating leases was $23.4 million, $25.0 million and $18.5 million for the years ended December, 2020, 2019 and 2018, respectively. From time to time, the Company is a party to various legal proceedings arising in the ordinary course of business. While DXP is unable to predict the outcome of these lawsuits, it believes that the ultimate resolution will not have, either individually or in the aggregate, a material adverse effect on DXP’s consolidated financial position, cash flows, or results of operations. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANSThe Company offers a 401(k) plan which is eligible to substantially all employees in the United States. For the year ended December 31, 2020, the Company elected to match employee contributions at a rate of 50 percent of up to 4 percent of salary deferral. The Company contributed $0.7 million, $1.7 million, and $1.8 million to the 401(k) plan in the years ended December 31, 2020, 2019, and 2018, respectively. In March 2020 the Company suspended indefinitely the employee match program. The Company contributed $0.7 million in the first quarter of 2020 to the 401(k) plan. No other contributions were made during the remainder of 2020. |
OTHER COMPREHENSIVE INCOME
OTHER COMPREHENSIVE INCOME | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
OTHER COMPREHENSIVE INCOME | OTHER COMPREHENSIVE INCOMEOther comprehensive income generally represents all changes in shareholders’ equity during the period, except those resulting from investments by, or distributions to, shareholders.During 2012 and 2013, the Company acquired four entities that operate in Canada. These Canadian entities maintain financial data in Canadian dollars. Upon consolidation, the Company translates the financial data from these foreign subsidiaries into U.S. dollars and records cumulative translation adjustments in other comprehensive income. The Company recorded $(1.9) million, $(0.7) million, and $0.2 million in translation adjustments, net of tax, in other comprehensive income during the years ended December 31, 2020, 2019 and 2018, respectively. |
SEGMENT AND GEOGRAPHICAL REPORT
SEGMENT AND GEOGRAPHICAL REPORTING | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT AND GEOGRAPHICAL REPORTING | SEGMENT AND GEOGRAPHICAL REPORTINGThe Company’s reportable business segments are: Service Centers, Innovative Pumping Solutions and Supply Chain Services. The Service Centers segment is engaged in providing maintenance, MRO products and equipment, including logistics capabilities, to industrial customers. The Service Centers segment provides a wide range of MRO products in the rotating equipment, bearing, power transmission, hose, fluid power, metal working, fastener, industrial supply, safety products and safety services categories. The Innovative Pumping Solutions segment fabricates and assembles custom-made pump packages, remanufactures pumps and manufactures branded private label pumps. The Supply Chain Services segment provides a wide range of MRO products and manages all or part of a customer's supply chain, including warehouse and inventory management. The high degree of integration of the Company’s operations necessitates the use of a substantial number of allocations and apportionments in the determination of business segment information. Sales are shown net of intersegment eliminations. The following table sets out financial information related to the Company’s segments ( in thousands ): Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2020 Product sales (recognized at a point in time) $ 595,314 $ — $ 138,653 $ 733,967 Inventory management services (recognized over contract life) — — 16,005 16,005 Staffing services (day-rate basis) 67,303 — — 67,303 Customized pump production (recognized over time) — $ 187,991 — 187,991 Total Revenue $ 662,617 $ 187,991 $ 154,658 $ 1,005,266 Operating income for reportable segments, excluding adjustments 70,385 18,715 13,218 102,318 Identifiable assets at year end 550,505 130,505 56,721 737,731 Capital expenditures 1,254 4,457 — 5,711 Proceeds from sale of fixed assets — — — — Depreciation 3,299 4,441 387 8,127 Amortization 6,989 5,298 — 12,287 Interest expense $ 11,506 $ 7,360 $ 1,705 $ 20,571 Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2019 Product sales (recognized at a point in time) $ 703,742 $ — $ 184,767 $ 888,509 Inventory management services (recognized over contract life) — — 16,511 16,511 Staffing services (day-rate basis) 58,514 — — 58,514 Customized pump production (recognized over time) — 303,655 — 303,655 Total Revenue $ 762,256 $ 303,655 $ 201,278 $ 1,267,189 Operating income for reportable segments, excluding adjustments 86,778 28,895 14,445 130,118 Identifiable assets at year end 462,663 212,015 56,714 731,392 Capital expenditures 2,333 9,347 922 12,602 Proceeds from sale of fixed assets 35 — — 35 Depreciation 3,517 4,602 285 8,404 Amortization 8,230 5,855 989 15,074 Interest expense $ 10,786 $ 6,747 $ 1,965 $ 19,498 Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2018 Product sales (recognized at a point in time) $ 685,309 $ — $ 160,770 $ 846,079 Inventory management services (recognized over contract life) — — 13,686 13,686 Staffing services (day-rate basis) 64,735 — — 64,735 Customized pump production (recognized over time) — 291,697 — 291,697 Total Revenue $ 750,044 $ 291,697 $ 174,456 $ 1,216,197 Operating income for reportable segments, excluding adjustments 80,718 33,943 16,204 130,865 Identifiable assets at year end 402,944 188,765 53,517 645,226 Capital expenditures 1,655 6,800 296 8,751 Depreciation 3,974 4,064 49 8,087 Amortization 9,272 6,237 1,077 16,586 Interest expense 11,178 7,351 2,408 20,937 Years Ended December 31, 2020 2019 2018 Operating income for reportable segments, excluding adjustments $ 102,318 $ 130,118 $ 130,865 Adjustments for: Amortization of intangibles 12,287 15,074 16,586 Impairment and other charges 59,883 — — Corporate and other expense, net 57,018 48,922 45,828 Total operating income $ (26,870) $ 66,122 $ 68,451 Interest expense 20,571 19,498 20,937 Other expenses (income), net 74 (45) (1,192) Income before income taxes $ (47,515) $ 46,669 $ 48,706 The Company had capital expenditures at Corporate of $1.0 million, $9.5 million, and $0.6 million for the years ended December 31, 2020, 2019, and 2018, respectively. The Company had identifiable assets at Corporate of $114.1 million, $56.8 million, and $54.7 million as of December 31, 2020, 2019, and 2018, respectively. Corporate depreciation was $2.3 million, $1.7 million, and $1.5 million for the years ended December 31, 2020, 2019, and 2018, respectively. Geographical Information Revenues are presented in geographic area based on location of the facility shipping products or providing services. Long-lived assets are based on physical locations and are comprised of the net book value of property. The Company’s revenues and property and equipment by geographical location are as follows (in millions) : Years Ended December 31, 2020 2019 2018 Revenues United States $ 931 $ 1,165 $ 1,110 Canada 74 102 106 Other (1) — — — Total $ 1,005 $ 1,267 $ 1,216 (1) Other includes Mexico and Dubai. As of December 31, 2020 2019 Property and Equipment, net United States $ 52 $ 56 Canada 5 8 Other (1) — — Total $ 57 $ 64 (1) Other includes Dubai. |
QUARTERLY FINANCIAL INFORMATION
QUARTERLY FINANCIAL INFORMATION (unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL INFORMATION (unaudited) | QUARTERLY FINANCIAL INFORMATION (unaudited) Summarized quarterly financial information for the years ended December 31, 2020, 2019 and 2018 is as follows ( in millions, except per share data ): First Second Third Fourth 2020 Sales $ 301.0 $ 251.4 $ 220.2 $ 232.7 Gross profit 84.0 70.0 61.3 64.3 Net income 5.7 2.1 (34.7) (2.0) Net income attributable to DXP Enterprises, Inc. 5.7 2.1 (34.7) (1.9) Earnings per share - basic 0.31 0.12 (1.95) (0.11) Earnings per share - diluted $ 0.31 $ 0.12 $ (1.95) $ (0.11) 2019 Sales $ 311.2 $ 333.3 $ 327.2 $ 295.5 Gross profit 84.2 92.0 92.7 78.3 Net income 7.3 13.4 13.2 2.1 Net income attributable to DXP Enterprises, Inc. 7.3 13.4 13.1 2.2 Earnings per share - basic 0.41 0.76 0.74 0.12 Earnings per share - diluted $ 0.40 $ 0.73 $ 0.71 $ 0.12 2018 Sales $ 285.9 $ 311.2 $ 308.0 $ 311.0 Gross profit 76.4 85.1 84.1 86.6 Net income 4.5 11.6 8.4 11.1 Net income attributable to DXP Enterprises, Inc. 4.6 11.6 8.4 11.1 Earnings per share - basic 0.26 0.66 0.48 0.63 Earnings per share - diluted $ 0.25 $ 0.63 $ 0.46 $ 0.60 The sum of the individual quarterly earnings per share amounts may not agree with year-to-date earnings per share as each quarter’s computation is based on the weighted average number of shares outstanding during the quarter, the weighted average stock price during the quarter and the dilutive effects of the stock options and restricted stock in each quarter. |
RELATED PARTIES DISCLOSURES
RELATED PARTIES DISCLOSURES | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES DISCLOSURES | RELATED PARTIES DISCLOSURES The Board uses policies and procedures, to be applied by the Audit Committee of the Board, for review, approval or ratification of any transactions with related persons. Those policies and procedures will apply to any proposed transactions in which DXP is a participant, the amount involved exceeds $120,000 and any director, executive officer or significant shareholder or any immediate family member of such a person has a direct or material indirect interest. Any related party transaction will be reviewed by the Audit Committee of the Board of Directors to determine, among other things, the benefits of any transaction to DXP, the availability of other sources of comparable products or services and whether the terms of the proposed transaction are comparable to those provided to unrelated third parties. For the year ended December 31, 2020, the Company paid approximately $ 3.1 million in lease expenses to entities controlled by the Company’s Chief Executive Officer, David Little. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and its variable interest entity (“VIE”). DXP is the primary beneficiary of a VIE in which DXP owns 47.5% of the equity. DXP consolidates the financial statements of the VIE with the financial statements of DXP. As of December 31, 2020, the total assets of the VIE were approximately $4.8 million including approximately $3.4 million of fixed assets. DXP is the primary customer of the VIE. Consolidation of the VIE increased cost of sales by approximately $0.8 million for the year ended December 31, 2020 and decreased cost of sales by approximately $0.4 million for the year ended December 31, 2019, respectively. The Company recognized a related income tax benefit of $116 thousand and $83 thousand related to the VIE for the years ended December 31, 2020 and December 31, 2019, respectively. As of December 31, 2020, the owners of the 52.5% of the equity not owned by DXP included employees of DXP. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the current year presentation; none affected net income. |
Foreign Currency | Foreign Currency The financial statements of the Company’s Canadian subsidiaries are measured using local currencies as their functional currencies. Assets and liabilities are translated into U.S. dollars at current exchange rates, while income and expenses are translated at average exchange rates. Translation gains and losses are reported in other comprehensive income (loss). Gains and losses on transactions denominated in foreign currency are reported in the consolidated statements of operations and comprehensive income (loss). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions in determining the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In the opinion of management, all adjustments necessary in order to make the financial statements not misleading have been included. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company’s presentation of cash includes cash equivalents. Cash equivalents are defined as short-term investments with maturity dates of 90 days or less at time of purchase. The Company places its cash and cash equivalents with institutions with high credit quality. However, at certain times, such cash and cash equivalents may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not historically experienced any losses when in excess of these limits. |
Receivables and Credit Risk | Receivables and Credit Risk Trade receivables consist primarily of uncollateralized customer obligations due under normal trade terms, which usually require payment within 30 days of the invoice date. However, these payment terms are extended in select cases and customers may not pay within stated trade terms. The Company has trade receivables from a diversified customer base located primarily in the Rocky Mountain, Northeastern, Midwestern, Southeastern and Southwestern regions of the United States and Canada. The Company believes no significant concentration of credit risk exists. The Company evaluates the creditworthiness of its customers' financial positions and monitors accounts on a regular basis. Provisions to the allowance for doubtful accounts are made monthly and adjustments are made periodically (as circumstances warrant) based upon management’s best estimate of the collectability of such accounts under the current expected credit losses model. The Company writes-off uncollectible trade accounts receivable when the accounts are determined to be uncollectible. No customer represents more than 10% of consolidated sales. |
Inventories | Inventories Inventories consist principally of equipment purchased for resale or finished goods and are priced at net realizable value, cost being primarily determined using the weighted average cost method. The Company regularly reviews inventory to evaluate continued demand and records provisions for the difference between cost and net realizable value arising from excess and obsolete items on hand. Provisions are provided against inventories for estimated excess and obsolescence based upon the aging of the inventories and market trends and are applied as a reduction in cost of the associated inventory. |
Property and Equipment | Property and Equipment Property and equipment are carried on the basis of cost. Depreciation of property and equipment is computed using the straight-line method over their estimated useful lives. Maintenance and repairs of depreciable assets are charged against earnings as incurred. When properties are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and gains or losses are credited or charged to earnings. The principal estimated useful lives used in determining depreciation are as follows: Buildings 20-39 years Building improvements 10-20 years Furniture, fixtures and equipment 3-20 years Leasehold improvements Shorter of estimated useful life or related lease term |
Impairment of Goodwill and Other Intangible Assets | Impairment of Goodwill and Other Intangible Assets The Company tests goodwill and other indefinite lived intangible assets for impairment on an annual basis in the fourth quarter and when events or changes in circumstances indicate that the carrying amount may not be recoverable. The Company assigns the carrying value of these intangible assets to its "reporting units" and applies the test for goodwill at the reporting unit level. A reporting unit is defined as an operating segment or one level below a segment (a "component") if the component is a business and discrete information is prepared and reviewed regularly by segment management. |
Impairment of Long-Lived Assets, Excluding Goodwill | Impairment of Long-Lived Assets, Excluding GoodwillThe Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value. |
Revenue Recognition | Revenue Recognition The Company fabricates and assembles custom-made pump packages, remanufactures pumps and manufactures branded private label pumps within our Innovative Pumping Solutions segment. For binding agreements to fabricate tangible assets to customer specifications, the Company recognizes revenues over time when the customer is able to direct the use of and obtain substantially all of the benefits of the work performed. This typically occurs when the products have no alternative use for us and we have a right to payment for the work completed to date plus a reasonable profit margin. Contracts generally include cancellation provisions that require the customer to reimburse us for costs incurred through the date of cancellation. We recognize revenue for these contracts using the percentage of completion method, an "input method" as defined by the new standard. Under this method, revenues are recognized as costs are incurred and include estimated profits calculated on the basis of the relationship between costs incurred and total estimated costs at completion. If at any time expected costs exceed the value of the contract, the loss is recognized immediately. The typical time span of these contracts is approximately one to two years. The Service Centers segment provides a wide range of maintenance, repair and operating (MRO) products, equipment and integrated services, including logistics capabilities, to industrial customers. The Supply Chain Services segment provides a wide range of MRO products and manages all or part of a customer's supply chain, including warehouse and inventory management services. Revenue is recognized upon the completion of our performance obligation(s) under the sales agreement. The majority of the Service Centers and Supply Chain Services segment revenues originate from the satisfaction of a single performance obligation, the delivery of products. Revenues are recognized when an agreement is in place, the performance obligations under the contract have been identified, and the price or consideration to be received is fixed and allocated to the performance obligation(s) in the contract. We believe our performance obligation has been satisfied when title passes to the customer or services have been rendered under the contract. Revenues are recorded net of sales taxes. |
Shipping and Handling Costs | Shipping and Handling Costs The Company classifies shipping and handling charges billed to customers as sales. Shipping and handling charges paid to others are classified as a component of cost of sales. |
Self-insured Insurance and Medical Claims | Self-insured Insurance and Medical Claims We generally retain up to $100,000 of risk for each claim for workers compensation, general liability, automobile and property loss. We accrue for the estimated loss on the self-insured portion of these claims. The accrual is adjusted quarterly based upon reported claims information. The actual cost could deviate from the recorded estimate. We generally retain up to $175,000 of risk on each medical claim for our employees and their dependents with the exception of less than 0.05% of employees where a higher risk is retained. We accrue for the estimated outstanding balance of unpaid medical claims for our employees and their dependents. The accrual is adjusted monthly based on recent claims experience. The actual claims could deviate from recent claims experience and be materially different from the reserve. |
Cost of Sales and Selling, General and Administrative Expense | Cost of Sales and Selling, General and Administrative Expense Cost of sales includes product and product related costs, inbound freight charges, internal transfer costs and depreciation. Selling, general and administrative expense includes purchasing and receiving costs, inspection costs, warehousing costs, depreciation and amortization. |
Income Taxes | Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Deferred income tax assets and liabilities are computed for differences between the financial statement and income tax bases of assets and liabilities. Such deferred income tax asset and liability computations are based on enacted tax laws and rates applicable to periods in which the differences are expected to reverse. Valuation allowances are established to reduce deferred income tax assets to the amounts expected to be realized under a more likely than not criterion. |
Accounting for Uncertainty in Income Taxes | Accounting for Uncertainty in Income Taxes A position taken or expected to be taken in a tax return is recognized in the financial statements when it is more likely than not (i.e. a likelihood of more than fifty percent) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various states. With few exceptions, the Company is no longer subject to U.S. federal, state and local tax examination by tax authorities for years prior to 2014. The Company's policy is to recognize interest related to unrecognized tax benefits as interest expense and penalties as operating expenses. The Company believes that it has appropriate support for the income tax positions taken and to be taken on its tax returns and that its accruals for tax liabilities are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. |
Comprehensive Income (Loss) | Comprehensive Income (Loss)Comprehensive income (loss) includes net income and foreign currency translation adjustments. The Company’s other comprehensive (loss) income is comprised of changes in the market value of an investment with quoted market prices in an active market for identical instruments and translation adjustments from translating foreign subsidiaries to the reporting currency. |
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements Intangibles-Goodwill and Other . In August 2018, the FASB issued ASU No. 2018-15, Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract based on a consensus of the FASB’s Emerging Issues Task Force (EITF) that requires implementation costs incurred by customers in cloud computing arrangements (CCAs) to be deferred and recognized over the term of the arrangement, if those costs would be capitalized by the customer in a software licensing arrangement under the internal-use software guidance in ASC 350-40, “Intangibles-Goodwill and Other-Internal-Use Software”. The ASU does not affect the accounting by cloud service providers, other software vendors or customers’ accounting for software licensing arrangements. The ASU requires companies to recognize deferred implementation costs to expense over the ‘term of the hosting arrangement’. Under the ASU, the term of the hosting arrangement comprises the non-cancellable period of the CCA plus any optional renewal periods that are reasonably certain to be exercised by the customer or for which exercise of the option is controlled by the vendor. The Company adopted the standard effective January 1, 2020. The standard did not have an impact on our results of operations. Fair Value Measurement. In August 2018, the FASB issued ASU 2018-13: Fair Value Measurement: Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement which eliminates, adds and modifies certain disclosure requirements for fair value measurements as part of its disclosure framework project. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public companies will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. The Company adopted the standard effective January 1, 2020. The standard did not have an impact on our results of operations. Measurement of Credit Losses on Financial Instruments . In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, as later modified by ASUs 2018-19, 2019-04, 2019-05, 2019-11 and 2020-02. This ASU requires estimating all expected credit losses for certain types of financial instruments, including trade receivables and contract assets, held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. The Company adopted this ASU effective January 1, 2020 which resulted in an immaterial impact to beginning retained earnings. While the adoption of this ASU did not have a material impact on the Company's financial statements, it required changes to the Company’s process of estimating expected credit losses on trade receivables and contract assets. The Company carries its accounts receivable at their face amounts less an allowance for expected credit losses. The Company establishes an allowance for expected credit losses to present the net amount of accounts receivable expected to be collected. On a regular basis, the Company evaluates its accounts receivable and contract assets and establishes the allowance for expected credit losses based on a combination of specific customer circumstances (including slow pays and bankruptcies), as well as history of write-offs and collections, current credit conditions and micro and macro-economic forecasts. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This update provides optional expedients and exceptions for applying generally accepted accounting principles to certain contract modifications and hedging relationships that reference London Inter-bank Offered Rate (LIBOR) or another reference rate expected to be discontinued. The guidance is effective upon issuance and generally can be applied through December 31, 2022. The Company is currently evaluating the potential impact of this ASU on the financial statements. All other new accounting pronouncements that have been issued but not yet effective are currently being evaluated and at this time are not expected to have a material impact on our financial position or results of operations. |
Leases | LEASES We lease office space, warehouses, land, automobiles, and office and manufacturing equipment. All of our leases are classified as operating leases. Our leases have remaining lease terms of 1 month to 10 years, some of which include options to extend the leases for up to 14 years. The exercise of lease renewal options is at our sole discretion. Our lease agreements do not include options to purchase the leased property. The Company adopted the provisions of ASC 842, "Leases" effective January 1, 2019. We elected to apply the current period transition approach as introduced by ASU 2018-11 for our transition at January 1, 2019 and we elected to apply the following practical expedients and accounting policy decisions. In January 2019, we recorded a ROU Asset and total lease liability obligations of $72.7 million and $72.4 million, respectively. The new standard did not have a material impact on our consolidated statements of operations and had no impact on cash flows. |
Fair Value of Financial Assets and Liabilities | FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES Authoritative guidance for financial assets and liabilities measured on a recurring basis applies to all financial assets and financial liabilities that are being measured and reported on a fair value basis. Fair value, as defined in the authoritative guidance, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance affects the fair value measurement of an investment with quoted market prices in an active market for identical instruments, which must be classified in one of the following categories: Level 1 Inputs Level 1 inputs come from quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 Inputs Level 2 inputs are other than quoted prices that are observable for an asset or liability. These inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from, or corroborated by, observable market data by correlation or other means. Level 3 Inputs Level 3 inputs are unobservable inputs for the asset or liability which require the Company's own assumptions. Financial assets and liabilities are classified based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. Our acquisitions may include contingent consideration as part of the purchase price. The fair value of the contingent consideration is estimated as of the acquisition date based on the present value of the contingent payments to be made using a weighted probability of possible payments. The unobservable inputs used in the determination of the fair value of the contingent consideration include managements assumptions about the likelihood of payment based on the established benchmarks and discount rates based on an internal rate of return analysis. The fair value measurement includes inputs that are Level 3 inputs as discussed above, as they are not observable in the market. Should actual results increase or decrease as compared to the assumptions used in our analysis, the fair value of the contingent consideration obligations will increase or decrease, up to the contracted limit, as applicable. Changes in the fair value of the contingent earn-out consideration are measured each reporting period and reflected in our results of operations. |
Segments and Geographical Reporting | SEGMENT AND GEOGRAPHICAL REPORTINGThe Company’s reportable business segments are: Service Centers, Innovative Pumping Solutions and Supply Chain Services. The Service Centers segment is engaged in providing maintenance, MRO products and equipment, including logistics capabilities, to industrial customers. The Service Centers segment provides a wide range of MRO products in the rotating equipment, bearing, power transmission, hose, fluid power, metal working, fastener, industrial supply, safety products and safety services categories. The Innovative Pumping Solutions segment fabricates and assembles custom-made pump packages, remanufactures pumps and manufactures branded private label pumps. The Supply Chain Services segment provides a wide range of MRO products and manages all or part of a customer's supply chain, including warehouse and inventory management.The high degree of integration of the Company’s operations necessitates the use of a substantial number of allocations and apportionments in the determination of business segment information. Sales are shown net of intersegment eliminations. Geographical Information Revenues are presented in geographic area based on location of the facility shipping products or providing services. Long-lived assets are based on physical locations and are comprised of the net book value of property. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Changes in Allowance for Uncollectible Trade Accounts Receivables | Changes in this allowance for 2020, 2019 and 2018 were as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Balance at beginning of year $ 8,929 $ 10,126 $ 9,015 Charged to costs and expenses 1,194 139 2,368 Charged to other accounts 21 (1) 79 (1) (86) (2) Deductions (1,516) (3) (1,415) (3) (1,171) (3) Balance at end of year $ 8,628 $ 8,929 $ 10,126 (1) Primarily due to translation adjustments (2) Includes allowance for doubtful accounts from acquisitions and divestiture (3) Uncollectible accounts written off, net of recoveries |
Schedule of Principal Estimated Useful Lives of Property and Equipment | The principal estimated useful lives used in determining depreciation are as follows: Buildings 20-39 years Building improvements 10-20 years Furniture, fixtures and equipment 3-20 years Leasehold improvements Shorter of estimated useful life or related lease term |
IMPAIRMENTS AND OTHER CHARGES (
IMPAIRMENTS AND OTHER CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Text Block Supplement [Abstract] | |
Schedule of Impairments and Other Charges | The negative market indicators described above were triggering events that indicated that certain of the Company’s long-lived intangible and tangible assets and additional inventory items may also have been impaired. Recoverability testing indicated that certain long-lived assets and inventory were indeed impaired. The estimated fair value of these assets was determined to be below their carrying value. As a result, the Company recorded the following additional impairment and other charges as detailed in the table below: (in thousands) Twelve Months Ended December 31, 2020 Long-lived asset impairments $ 4,775 Goodwill impairments 36,435 Inventory and work-in-progress costs 18,673 Total impairment and other charges $ 59,883 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease Expenses, Supplemental Cash Flow and Balance Sheet Information and Lease Term and Discount Rate | The lease expenses were as follows (in thousands) : Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Lease cost Classification Short-term lease expense SG&A expenses (*) $ 374 $ 1,087 Other operating lease cost SG&A expenses (*) 22,983 23,911 Total operating lease cost $ 23,357 $ 24,998 (*) Manufacturing equipment and some vehicle rental expenses are included in the cost of sales. Supplemental cash flow information related to leases was as follows (in thousands) : Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Lease Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 18,250 $ 19,020 Right-of-use assets obtained in exchange for lease liabilities Operating leases $ 5,639 $ 12,608 Lease term and discount rate Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Weighted average remaining lease term (years) Operating lease 4.29 4.74 Weighted average discount rate Operating lease 7.2% 7.3% |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows (in thousand) : Lease Classification December 31, 2020 December 31, 2019 Assets Operating Operating lease right-of-use assets $ 55,188 $ 66,191 Liabilities Current operating Short-term operating lease liabilities 15,891 17,603 Non-current operating Long-term operating lease liabilities 38,010 48,605 Total operating lease liabilities $ 53,901 $ 66,208 |
Schedule of Maturity of Lease Liabilities | Maturities of lease liabilities were as follows (in thousands) : Year Ending December 31, Operating leases (*) 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total lease payments $ 63,023 Less: imputed interest 9,122 Present value of lease liabilities $ 53,901 (*) Operating lease payments exclude $2.8 million and $1.1 million of legally binding minimum lease payments for leases signed but not yet commenced, as of December 31, 2020 and December 31, 2019, respectively. The Company leases equipment, automobiles and office facilities under various operating leases. The future minimum rental commitments as of December, 2020, for non-cancelable leases are as follows ( in thousands ): 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total $ 63,023 |
FAIR VALUE OF FINANCIAL ASSET_2
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Reconciliation of the Beginning and Ending Balance and Gains or Losses Recognized | For the Company's assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3), the following table provides a reconciliation of the beginning and ending balances for each category therein, and gains or losses recognized during the twelve months ended December 31, 2020: Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Contingent Liability for Accrued Consideration (in thousands) Beginning balance at December 31, 2019 $ 2,705 Acquisitions and settlements Acquisitions ( Note 17 ) — Settlements (2,000) Total remeasurement adjustments: Changes in fair value recorded in other (income) expense, net 395 Ending balance at December 31, 2020 $ 1,100 The amount of total (gains) or losses for the year included in earnings or changes to net assets, attributable to changes in unrealized (gains) or losses relating to assets or liabilities still held at year-end. 395 * Included in other current liabilities |
Schedule of Quantitative Information About Level 3 Fair Value Measurements | The significant unobservable inputs used in the fair value measurement of the Company's contingent consideration liabilities designated as Level 3 are as follows: (in thousands, unaudited) Fair Value at December 31, 2020 Valuation Technique Significant Unobservable Inputs Contingent consideration: (ASI acquisition) $ 1,100 Discounted cash flow Annualized EBITDA and probability of achievement |
INVENTORIES (Tables)
INVENTORIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Carrying Values of Inventories | The carrying values of inventories were as follows ( in thousands ): December 31, 2020 December 31, 2019 Finished goods $ 114,029 $ 122,510 Work in process 8,519 19,721 Obsolescence reserve (25,477) (12,867) Inventories $ 97,071 $ 129,364 |
COSTS AND ESTIMATED PROFITS O_2
COSTS AND ESTIMATED PROFITS ON UNCOMPLETED CONTRACTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Contractors [Abstract] | |
Schedule of Costs and Estimated Earnings on Uncompleted Contracts Included in Condensed Consolidated Balance Sheets | Costs and estimated profits on uncompleted contracts and related amounts billed for 2020 and 2019 were as follows ( in thousands ): December 31, 2020 2019 Costs incurred on uncompleted contracts $ 36,969 $ 51,017 Estimated profits, thereon 6,711 10,771 Total $ 43,680 $ 61,788 Less: billings to date 29,315 41,223 Net $ 14,365 $ 20,565 Such amounts were included in the accompanying Consolidated Balance Sheets for 2020 and 2019 under the following captions ( in thousands ): December 31, 2020 2019 Costs and estimated profits in excess of billings $ 18,459 $ 32,455 Billings in excess of costs and estimated profits (4,061) (11,871) Translation Adjustment (33) (19) Net $ 14,365 $ 20,565 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | The carrying values of property and equipment were as follows ( in thousands ): December 31, 2020 December 31, 2019 Land $ 2,558 $ 1,960 Buildings and leasehold improvements 22,952 15,445 Furniture, fixtures and equipment 110,159 119,865 Less – Accumulated depreciation (78,770) (73,567) Total Property and Equipment $ 56,899 $ 63,703 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill and Other Intangible Assets | The following table presents the changes in the carrying amount of goodwill and other intangible assets during the year ended December 31, 2020 ( in thousands ): Goodwill Other Total Balances as of December 31, 2019 $ 194,052 $ 52,582 $ 246,634 Translation adjustment — (4) (4) Acquisitions 90,722 39,797 130,519 Impairment (36,435) — (36,435) Amortization — (12,287) (12,287) Balances as of December 31, 2020 $ 248,339 $ 80,088 $ 328,427 The following table presents the changes in the carrying amount of goodwill and other intangible assets during the year ended December 31, 2019 ( in thousands ): Goodwill Other Total Balances as of December 31, 2018 $ 194,052 $ 67,207 $ 261,259 Translation adjustment — 449 449 Amortization — (15,074) (15,074) Balances as of December 31, 2019 $ 194,052 $ 52,582 $ 246,634 |
Schedule of Goodwill Balance by Reportable Segment | The following table presents the goodwill balance by reportable segment as of December 31, 2020 and 2019 (in thousands) : As of December 31, 2020 2019 Service Centers $ 231,200 $ 160,934 Innovative Pumping Solutions — 15,980 Supply Chain Services 17,139 17,138 Total $ 248,339 $ 194,052 |
Schedule of Other Intangible Assets | The following table presents a summary of other intangible assets ( in thousands ): As of December 31, 2020 As of December 31, 2019 Gross Accumulated Carrying Gross Accumulated Carrying Customer relationships $ 193,747 $ (116,028) $ 77,719 $ 156,282 $ (103,796) $ 52,486 Non-compete agreements 2,617 (248) 2,369 285 (189) 96 Total $ 196,364 $ (116,276) $ 80,088 $ 156,567 $ (103,985) $ 52,582 |
Schedule of Future Amortization Expense of Other Intangible Assets | The estimated future annual amortization of intangible assets for each of the next five years and thereafter are as follows (in thousands) : 2021 $ 15,564 2022 14,223 2023 12,504 2024 10,426 2025 9,023 Thereafter 18,348 Total $ 80,088 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consisted of the following ( in thousands ): December 31, 2020 December 31, 2019 Carrying Value (1) Fair Value Carrying Value (1) Fair Value ABL Revolver $ — — $ — — Term Loan B 330,000 325,875 244,375 244,375 Total Debt 330,000 325,875 244,375 244,375 Less: Current maturities (3,300) (3,259) (2,500) (2,500) Total Long-term Debt $ 326,700 $ 322,616 $ 241,875 $ 241,875 |
Schedule of Secured Leverage Ratio to EBITDA | Secured Leverage Ratio – The Term Loan B Agreement requires that the Company’s Secured Leverage Ratio, defined as the ratio, as of the last day of any fiscal quarter of consolidated secured debt (net of unrestricted cash, not to exceed $150 million) as of such day to EBITDA, beginning with the fiscal quarter ending December 31, 2020, is either equal to or less than as indicated in the table below: Fiscal Quarter Secured Leverage Ratio December 31, 2020 5.75:1:00 March 31, 2021 5.75:1:00 June 30, 2021 5.75:1:00 September 30, 2021 5.50:1:00 December 31, 2021 5.50:1:00 March 31, 2022 5.25:1:00 June 30, 2022 5.25:1:00 September 30, 2022 5.25:1:00 December 31, 2022 5.00:1:00 March 31, 2023 5.00:1:00 June 30, 2023 and each Fiscal Quarter thereafter 4.75:1:00 |
Schedule of Interest Rate on Borrowings Outstanding | The interest rates on our borrowings outstanding at December 31, 2020 and 2019, including the amortization of debt issuance costs, were as follows: December 31, 2020 2019 ABL Revolver 1.9 % 3.5 % Term Loan B 5.75 % 6.5 % Weighted average interest rate 5.75 % 6.5 % |
Schedule of Maturities of Long-term Debt | As of December 31, 2020, the maturities of long-term debt for the next five years and thereafter were as follows ( in thousands ): Year $ Amount 2021 $ 3,300 2022 3,300 2023 3,300 2024 3,300 2025 3,300 Thereafter 313,500 Total $ 330,000 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) Before Income Taxes | The components of income (loss) before income taxes were as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Domestic $ (32,440) $ 41,184 $ 46,270 Foreign (15,075) 5,485 2,436 Total income before taxes $ (47,515) $ 46,669 $ 48,706 |
Schedule of Provision for Income Taxes | The provision for income taxes consisted of the following ( in thousands ): Years Ended December 31, 2020 2019 2018 Current - Federal $ (6,179) $ 4,940 $ 7,295 State (154) 1,862 2,257 Foreign 2,663 2,982 2,629 Total current $ (3,670) $ 9,784 $ 12,181 Deferred - Federal (10,568) 2,618 2,389 State (3,125) (224) 123 Foreign (1,078) (1,284) (1,508) Total deferred $ (14,771) $ 1,110 $ 1,004 Total current and deferred taxes $ (18,441) $ 10,894 $ 13,185 |
Schedule of Differences Between Income Taxes Computed at Statutory Income Tax Rate and Provision For Income Taxes | The difference between income taxes computed at the statutory income tax rate and the provision for income taxes is as follows ( in thousands ): Years Ended December 31, 2020 2019 2018 Income taxes computed at federal statutory rate $ (9,978) $ 9,801 $ 10,228 State income taxes, net of federal benefit (2,591) 1,294 1,880 Foreign taxes (492) 311 150 Nondeductible expenses 5,617 1,108 954 Enacted rate changes 670 — — Research and development tax credit (16,878) (2,324) (480) Foreign tax credit — (57) (346) Valuation allowance 16 (5) — Tax reform deferred tax remeasurement — — 81 Deferred tax liability true up (551) 1,065 — Uncertain tax positions 5,057 665 172 Other 689 (964) 546 Total income tax expense (benefit) $ (18,441) $ 10,894 $ 13,185 |
Schedule of Deferred Tax Liabilities and Assets | Deferred tax liabilities and assets were comprised of the following ( in thousands ): December 31, 2020 2019 Deferred tax assets: Allowance for doubtful accounts $ 1,784 $ 1,657 Inventory 7,073 3,254 Research and development credit carryforward 8,407 1,361 Foreign tax credit carryforward 64 64 Net operating loss carryforward 802 812 Capital loss carryforward 12,813 12,363 Deferred compensation 540 — Accruals 5,690 4,077 Investment in partnerships 319 500 Other 312 — Total deferred tax assets $ 37,804 $ 24,088 Less valuation allowance (12,813) (12,363) Total deferred tax asset, net of valuation deferred tax liabilities : $ 24,991 $ 11,725 Goodwill (8,570) (8,459) Intangibles (8,512) (2,051) Property and equipment (7,569) (8,319) ROU asset and liability (323) — Unremitted foreign earnings (421) (421) Deferred compensation — (317) Method changes (754) (1,961) Other (619) (69) Net deferred tax liability $ (1,777) $ (9,872) |
Schedule of Changes in Valuation Allowance for Deferred Tax Assets | The following summarizes changes in the balance of valuation allowances on deferred tax assets (in thousands): Years Ended December 31, 2020 2019 2018 Balance at January 1 $ (12,363) $ (12,564) $ (12,220) Changes due to federal and foreign capital loss carryforwards (450) 201 (344) Balance at December 31 $ (12,813) $ (12,363) $ (12,564) |
Schedule of Tax Carryforwards | Tax carryforwards available for use on future income tax returns, prior to valuation allowance, at December 31, 2020, were as follows (in thousands): Domestic Foreign Expiration Net operating loss - foreign $ — $ 414 2034 - 2040 Net operating loss - federal 388 — 2036 - 2040 Capital loss carryforward - foreign — 4 Indefinite Capital loss carryforward - federal 12,809 — 2021 Foreign tax credits 64 — 2023, 2025 Federal research and development tax credits 4,467 — 2026 - 2030 Texas research and development tax credits 3,700 — 2037 - 2040 Louisiana research and development tax credits 239 — 2024 - 2025 |
Schedule of Changes in Unrecognized Tax Benefits | Changes in the balance of unrecognized tax benefits excluding interest and penalties on uncertain tax positions were as follows (in thousands): Assets (Liabilities) 2020 2019 2018 Balance at January 1 $ — $ — $ — Increases related to prior year tax positions (5,057) — — Decreases related to prior year tax positions — — — Increases related to current year tax positions — — — Settlements — — — Lapse of statute of limitations — — — Balance at December 31 $ (5,057) $ — $ — |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Changes in Restricted Stock | Changes in restricted stock awards for the twelve months ended December 31, 2020 were as follows: Number of Weighted Average Non-vested at December 31, 2019 144,250 $ 32.71 Granted 100,299 $ 30.91 Forfeited (16,794) $ 28.61 Vested (60,779) $ 31.33 Non-vested at December 31, 2020 166,976 $ 32.53 Changes in restricted stock awards for the twelve months ended December 31, 2019 were as follows: Number of Weighted Average Non-vested at December 31, 2018 169,293 $ 31.05 Granted 46,885 $ 35.60 Forfeited (5,720) $ 32.35 Vested (66,208) $ 27.75 Non-vested at December 31, 2019 144,250 $ 32.71 Changes in restricted stock awards for the twelve months ended December 31, 2018 were as follows: Number of Weighted Average Non-vested at December 31, 2017 77,901 $ 30.36 Granted 131,413 $ 31.92 Forfeited (2,400) $ 46.68 Vested (37,621) $ 31.68 Non-vested at December 31, 2018 169,293 $ 31.05 |
EARNINGS PER SHARE DATA (Tables
EARNINGS PER SHARE DATA (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings per Share | The following table sets forth the computation of basic and diluted earnings per share for the periods indicated ( in thousands, except per share data ): December 31, 2020 2019 2018 Basic: Weighted average shares outstanding 17,748 17,592 17,553 Net income (loss) attributable to DXP Enterprises, Inc. $ (28,726) $ 36,035 $ 35,632 Convertible preferred stock dividend (90) (90) (90) Net income (loss) attributable to common shareholders $ (28,816) $ 35,945 $ 35,542 Per share amount $ (1.62) $ 2.04 $ 2.02 Diluted: Weighted average shares outstanding 17,748 17,592 17,553 Assumed conversion of convertible preferred stock — 840 840 Total dilutive shares 17,748 18,432 18,393 Net income (loss) attributable to common shareholders $ (28,816) $ 35,945 $ 35,542 Convertible preferred stock dividend — 90 90 Net income (loss) attributable to DXP Enterprises, Inc. $ (28,816) $ 36,035 $ 35,632 Per share amount $ (1.62) $ 1.96 $ 1.94 |
CAPITAL STOCK (Tables)
CAPITAL STOCK (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of Activity Related to Common Stock Outstanding | The activity related to outstanding common stock and common stock held in treasury was as follows: December 31, 2020 2019 2018 Common Stock: Quantity (in thousands) Balance, beginning of period 17,460 17,401 17,316 Issuance of shares for compensation net of withholding 54 59 85 Issuance of common stock related to equity distribution agreements 46 — — Issuance of common stock related to purchase of businesses 1,481 — — Balance, end of period 19,041 17,460 17,401 |
BUSINESS ACQUISITIONS (Tables)
BUSINESS ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Total Consideration Transferred and Aggregate Amount of Assets Acquired and Liabilities Assumed for 2020 Acquisitions | The following table summarizes the total consideration for 2020 transferred to acquire these companies and in aggregate the amount of identified assets acquired and liabilities assumed at the acquisition dates. The Company is in the process of finalizing third-party valuations of certain intangible assets; thus, the provisional measurements of intangible assets, goodwill and deferred income tax liabilities are subject to change. In addition, the company continues to finalize inventory, ROU Assets and Liabilities as well as other assets acquired. As described above, the acquisitions of Pumping Systems Inc and Turbo Machinery Repair closed in January and February 2020, respectively. Since their acquisition, they have contributed approximately $19.6 million in revenue and $0.8 million in net income for the year ended December 31, 2020. None of these acquisitions were individually material. Two of these acquisitions, PSI and Turbo, contributed revenue and net income (loss) which comprised approximately 1.9% and (2.9)%, respectively, of the Company’s consolidated results for the year ended December 31, 2020. Purchase Price Consideration (in thousands) Total Consideration Cash payments $ 115,247 Fair value of stock issued (1,480,909 shares) 29,367 Total consideration transferred $ 144,614 Cash $ 1 Accounts Receivable 20,204 Inventory 8,567 Other Current Assets 190 Property and equipment 1,811 Non-compete agreements 2,332 Customer relationships 37,465 Goodwill 90,722 Other assets 696 Assets acquired $ 161,988 Current liabilities assumed (10,674) Deferred tax liability (6,700) Net assets acquired $ 144,614 |
Schedule of Pro Forma Information | The following represents the pro forma unaudited revenue and earnings as if each of the six 2020 acquisitions had been included in the consolidated results of the Company for the full years ending December 31, 2020 and 2019, respectively: Years Ended December 31, 2020 2019 (in thousands/unaudited) Revenue $ 1,129,610 $ 1,423,805 Net income (loss) $ (15,148) $ 41,219 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Maturity of Lease Liabilities | Maturities of lease liabilities were as follows (in thousands) : Year Ending December 31, Operating leases (*) 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total lease payments $ 63,023 Less: imputed interest 9,122 Present value of lease liabilities $ 53,901 (*) Operating lease payments exclude $2.8 million and $1.1 million of legally binding minimum lease payments for leases signed but not yet commenced, as of December 31, 2020 and December 31, 2019, respectively. The Company leases equipment, automobiles and office facilities under various operating leases. The future minimum rental commitments as of December, 2020, for non-cancelable leases are as follows ( in thousands ): 2021 $ 19,183 2022 15,990 2023 10,571 2024 6,084 2025 3,924 Thereafter 7,271 Total $ 63,023 |
SEGMENT AND GEOGRAPHICAL REPO_2
SEGMENT AND GEOGRAPHICAL REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Financial Information Related to Company's Segments | The following table sets out financial information related to the Company’s segments ( in thousands ): Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2020 Product sales (recognized at a point in time) $ 595,314 $ — $ 138,653 $ 733,967 Inventory management services (recognized over contract life) — — 16,005 16,005 Staffing services (day-rate basis) 67,303 — — 67,303 Customized pump production (recognized over time) — $ 187,991 — 187,991 Total Revenue $ 662,617 $ 187,991 $ 154,658 $ 1,005,266 Operating income for reportable segments, excluding adjustments 70,385 18,715 13,218 102,318 Identifiable assets at year end 550,505 130,505 56,721 737,731 Capital expenditures 1,254 4,457 — 5,711 Proceeds from sale of fixed assets — — — — Depreciation 3,299 4,441 387 8,127 Amortization 6,989 5,298 — 12,287 Interest expense $ 11,506 $ 7,360 $ 1,705 $ 20,571 Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2019 Product sales (recognized at a point in time) $ 703,742 $ — $ 184,767 $ 888,509 Inventory management services (recognized over contract life) — — 16,511 16,511 Staffing services (day-rate basis) 58,514 — — 58,514 Customized pump production (recognized over time) — 303,655 — 303,655 Total Revenue $ 762,256 $ 303,655 $ 201,278 $ 1,267,189 Operating income for reportable segments, excluding adjustments 86,778 28,895 14,445 130,118 Identifiable assets at year end 462,663 212,015 56,714 731,392 Capital expenditures 2,333 9,347 922 12,602 Proceeds from sale of fixed assets 35 — — 35 Depreciation 3,517 4,602 285 8,404 Amortization 8,230 5,855 989 15,074 Interest expense $ 10,786 $ 6,747 $ 1,965 $ 19,498 Years Ended December 31, Service Centers Innovative Pumping Solutions Supply Chain Services Total 2018 Product sales (recognized at a point in time) $ 685,309 $ — $ 160,770 $ 846,079 Inventory management services (recognized over contract life) — — 13,686 13,686 Staffing services (day-rate basis) 64,735 — — 64,735 Customized pump production (recognized over time) — 291,697 — 291,697 Total Revenue $ 750,044 $ 291,697 $ 174,456 $ 1,216,197 Operating income for reportable segments, excluding adjustments 80,718 33,943 16,204 130,865 Identifiable assets at year end 402,944 188,765 53,517 645,226 Capital expenditures 1,655 6,800 296 8,751 Depreciation 3,974 4,064 49 8,087 Amortization 9,272 6,237 1,077 16,586 Interest expense 11,178 7,351 2,408 20,937 |
Schedule of Reconciliation of Operating Income for Reportable Segments to Consolidated Income Before Taxes | Years Ended December 31, 2020 2019 2018 Operating income for reportable segments, excluding adjustments $ 102,318 $ 130,118 $ 130,865 Adjustments for: Amortization of intangibles 12,287 15,074 16,586 Impairment and other charges 59,883 — — Corporate and other expense, net 57,018 48,922 45,828 Total operating income $ (26,870) $ 66,122 $ 68,451 Interest expense 20,571 19,498 20,937 Other expenses (income), net 74 (45) (1,192) Income before income taxes $ (47,515) $ 46,669 $ 48,706 |
Schedule of Revenues by Geographical Location | The Company’s revenues and property and equipment by geographical location are as follows (in millions) : Years Ended December 31, 2020 2019 2018 Revenues United States $ 931 $ 1,165 $ 1,110 Canada 74 102 106 Other (1) — — — Total $ 1,005 $ 1,267 $ 1,216 (1) Other includes Mexico and Dubai. |
Schedule of Property, Plant and Equipment by Geographical Location | As of December 31, 2020 2019 Property and Equipment, net United States $ 52 $ 56 Canada 5 8 Other (1) — — Total $ 57 $ 64 (1) Other includes Dubai. |
QUARTERLY FINANCIAL INFORMATI_2
QUARTERLY FINANCIAL INFORMATION (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Summarized Quarterly Financial Information (unaudited) | Summarized quarterly financial information for the years ended December 31, 2020, 2019 and 2018 is as follows ( in millions, except per share data ): First Second Third Fourth 2020 Sales $ 301.0 $ 251.4 $ 220.2 $ 232.7 Gross profit 84.0 70.0 61.3 64.3 Net income 5.7 2.1 (34.7) (2.0) Net income attributable to DXP Enterprises, Inc. 5.7 2.1 (34.7) (1.9) Earnings per share - basic 0.31 0.12 (1.95) (0.11) Earnings per share - diluted $ 0.31 $ 0.12 $ (1.95) $ (0.11) 2019 Sales $ 311.2 $ 333.3 $ 327.2 $ 295.5 Gross profit 84.2 92.0 92.7 78.3 Net income 7.3 13.4 13.2 2.1 Net income attributable to DXP Enterprises, Inc. 7.3 13.4 13.1 2.2 Earnings per share - basic 0.41 0.76 0.74 0.12 Earnings per share - diluted $ 0.40 $ 0.73 $ 0.71 $ 0.12 2018 Sales $ 285.9 $ 311.2 $ 308.0 $ 311.0 Gross profit 76.4 85.1 84.1 86.6 Net income 4.5 11.6 8.4 11.1 Net income attributable to DXP Enterprises, Inc. 4.6 11.6 8.4 11.1 Earnings per share - basic 0.26 0.66 0.48 0.63 Earnings per share - diluted $ 0.25 $ 0.63 $ 0.46 $ 0.60 |
THE COMPANY (Details)
THE COMPANY (Details) | 12 Months Ended |
Dec. 31, 2020segment | |
THE COMPANY [Abstract] | |
Number of business segments | 3 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Variable Interest Entity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Risks and Uncertainties [Abstract] | |||
Assets | $ 851,861 | $ 788,220 | |
Fixed assets | 56,899 | 63,703 | |
Income tax benefit | $ 18,441 | (10,894) | $ (13,185) |
Employees | |||
Risks and Uncertainties [Abstract] | |||
Ownership percentage in VIE | 52.50% | ||
Variable Interest Entity, Primary Beneficiary | |||
Risks and Uncertainties [Abstract] | |||
Ownership percentage in VIE | 47.50% | ||
Assets | $ 4,800 | ||
Fixed assets | 3,400 | ||
Increase (decrease) in cost of sales | 800 | (400) | |
Income tax benefit | $ 116 | $ 83 |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Changes in Allowance for Uncollectible Trade Accounts Receivables (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts Receivable , Allowances for Credit Loss [Roll Forward] | |||
Balance at beginning of year | $ 8,929 | $ 10,126 | $ 9,015 |
Charged to costs and expenses | 1,194 | 139 | 2,368 |
Charged to other accounts | 21 | 79 | (86) |
Deductions | (1,516) | (1,415) | (1,171) |
Balance at end of year | $ 8,628 | $ 8,929 | $ 10,126 |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Buildings | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 20 years |
Buildings | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 39 years |
Building improvements | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 10 years |
Building improvements | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 20 years |
Furniture, fixtures and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 3 years |
Furniture, fixtures and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of property and equipment | 20 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated useful life of leasehold improvements | Shorter of estimated useful life or related lease term |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Impairment of Goodwill, Other Intangibles and Long-lived Assets (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Goodwill impairments | $ 36,435 |
Long-lived asset impairments | $ 4,775 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Revenue Recognition (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Minimum | |
Deferred Revenue Arrangement [Line Items] | |
Revenue performance obligation expected satisfaction period | one |
Maximum | |
Deferred Revenue Arrangement [Line Items] | |
Revenue performance obligation expected satisfaction period | two |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING AND BUSINESS POLICIES - Self-insured Insurance and Medical Claims (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reinsurance Retention Policy [Line Items] | ||
Employee-related liabilities | $ 2,600,000 | $ 2,500,000 |
Self-insured Insurance | Maximum | ||
Reinsurance Retention Policy [Line Items] | ||
Reinsurance retention policy, amount retained | 100,000 | |
Medical Claims | Maximum | ||
Reinsurance Retention Policy [Line Items] | ||
Reinsurance retention policy, amount retained | $ 175,000 | |
Retention percentage of employee higher risk claims | 0.05% |
IMPAIRMENTS AND OTHER CHARGES -
IMPAIRMENTS AND OTHER CHARGES - Narrative (Details) $ in Thousands | Jul. 31, 2020USD ($) | Mar. 31, 2020$ / bbl | Jan. 01, 2020$ / bbl | Sep. 30, 2020$ / bbl | Jun. 30, 2020 | Dec. 31, 2020USD ($)reporting_unit |
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Number of reporting units | reporting_unit | 4 | |||||
Number of reporting units with goodwill below their carrying values | reporting_unit | 2 | |||||
Goodwill impairment | $ 36,435 | |||||
COVID-19 | ||||||
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Goodwill impairment | 36,400 | |||||
COVID-19 | Discount Rate | Minimum | ||||||
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Reporting unit, measurement input | 0.148 | |||||
COVID-19 | Discount Rate | Maximum | ||||||
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Reporting unit, measurement input | 0.164 | |||||
COVID-19 | Innovative Pumping Solutions | ||||||
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Goodwill impairment | $ 16,000 | |||||
Oil spot price (in dollars per barrel) | $ / bbl | 21 | 63 | 41 | |||
Percentage decrease in average oil price per barrel | 0.28 | 0.35 | ||||
Reduction in weighted average costs of capital | 100 | |||||
Increase in revenue long-term growth rate projections | 0.10 | |||||
COVID-19 | Canada | ||||||
Impaired Long-Lived Assets Held and Used [Line Items] | ||||||
Goodwill impairment | $ 20,500 | |||||
Increase in revenue long-term growth rate projections | 0.0150 | |||||
Percentage of fair value less than carrying amount of reporting unit | 40.00% | |||||
Decrease in pre-tax discount rate | 0.0480 |
IMPAIRMENTS AND OTHER CHARGES_2
IMPAIRMENTS AND OTHER CHARGES (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Disclosure Text Block Supplement [Abstract] | |
Long-lived asset impairments | $ 4,775 |
Goodwill impairments | 36,435 |
Inventory and work-in-progress costs | 18,673 |
Total impairment and other charges | $ 59,883 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Lease extension period (up to) | 14 years | ||
Right-of-use asset | $ 55,188 | $ 66,191 | $ 72,700 |
Lease liability obligations | 53,901 | 66,208 | $ 72,400 |
Operating lease expense | 23,400 | $ 25,000 | |
Chief Executive Officer | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease expense | $ 3,100 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 1 month | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Remaining lease term | 10 years |
LEASES - Lease Expense (Details
LEASES - Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Short-term lease expense | $ 374 | $ 1,087 |
Other operating lease cost | 22,983 | 23,911 |
Total operating lease cost | $ 23,357 | $ 24,998 |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 18,250 | $ 19,020 |
Right-of-use assets obtained in exchange for lease liabilities | ||
Operating leases | $ 5,639 | $ 12,608 |
LEASES - Supplemental Balance S
LEASES - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
Assets | |||
Operating lease right-of-use assets | $ 55,188 | $ 66,191 | $ 72,700 |
Liabilities | |||
Short-term operating lease liabilities | 15,891 | 17,603 | |
Long-term operating lease liabilities | 38,010 | 48,605 | |
Present value of lease liabilities | $ 53,901 | $ 66,208 | $ 72,400 |
LEASES - Maturity of Lease Liab
LEASES - Maturity of Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 |
Operating Leases | |||
2021 | $ 19,183 | ||
2022 | 15,990 | ||
2023 | 10,571 | ||
2024 | 6,084 | ||
2025 | 3,924 | ||
Thereafter | 7,271 | ||
Total lease payments | 63,023 | ||
Less: imputed interest | 9,122 | ||
Present value of lease liabilities | 53,901 | $ 66,208 | $ 72,400 |
Minimum lease payments for leases signed but not yet commenced | $ 2,800 | $ 1,100 |
LEASES - Lease Term and Discoun
LEASES - Lease Term and Discount Rate (Details) | Dec. 31, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||
Weighted average remaining lease term, operating lease | 4 years 3 months 14 days | 4 years 8 months 26 days |
Weighted average discount rate, operating lease | 7.20% | 7.30% |
FAIR VALUE OF FINANCIAL ASSET_3
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES - Narrative (Details) $ in Thousands | Dec. 31, 2020USD ($) | Jan. 01, 2018USD ($) |
Discounted cash flow | Fair Value, Inputs, Level 3 | Annualized EBITDA and probability of achievement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liability for contingent consideration | $ 1,100 | |
Discount rate | 0.079 | |
ASI | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liability for contingent consideration | $ 4,600 | |
ASI | Other Current and Long-term Liabilities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Liability for contingent consideration | $ 1,100 |
FAIR VALUE OF FINANCIAL ASSET_4
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES - Reconciliation of Beginning and Ending Balances (Details) - Fair Value, Measurements, Recurring - Fair Value, Inputs, Level 3 - Contingent Consideration Liability $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Contingent Liability for Accrued Consideration | |
Beginning Balance at December 31, 2019 | $ 2,705 |
Acquisitions and settlements | |
Acquisitions | 0 |
Settlements | (2,000) |
Total remeasurement adjustments: | |
Changes in fair value recorded in other (income) expense, net | 395 |
Ending Balance at December 31, 2020 | 1,100 |
The amount of total (gains) or losses for the year included in earnings or changes to net assets, attributable to changes in unrealized (gains) or losses relating to assets or liabilities still held at year-end. | $ 395 |
FAIR VALUE OF FINANCIAL ASSET_5
FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES - Quantitative Information About Level 3 (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Fair Value, Inputs, Level 3 | Discounted cash flow | Annualized EBITDA and probability of achievement | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Contingent consideration: (ASI acquisition) | $ 1,100 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 114,029 | $ 122,510 |
Work in process | 8,519 | 19,721 |
Obsolescence reserve | (25,477) | (12,867) |
Inventories | $ 97,071 | $ 129,364 |
COSTS AND ESTIMATED PROFITS O_3
COSTS AND ESTIMATED PROFITS ON UNCOMPLETED CONTRACTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Schedule of costs and estimated earnings on uncompleted contracts [Abstract] | ||
Costs incurred on uncompleted contracts | $ 36,969 | $ 51,017 |
Estimated profits, thereon | 6,711 | 10,771 |
Total | 43,680 | 61,788 |
Less: billings to date | 29,315 | 41,223 |
Net | 14,365 | 20,565 |
Schedule of Costs and Estimated Earnings on Uncompleted Contracts Included in Condensed Consolidated Balance Sheets [Abstract] | ||
Costs and estimated profits in excess of billings | 18,459 | 32,455 |
Billings in excess of costs and estimated profits | (4,061) | (11,871) |
Translation Adjustment | (33) | (19) |
Net | 14,365 | $ 20,565 |
Balances previously classified as contract liabilities at the beginning of the period shipped during fiscal year | $ 11,900 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Less – Accumulated depreciation | $ (78,770) | $ (73,567) | |
Property and equipment, net | 56,899 | 63,703 | |
Depreciation expense | 10,396 | 10,100 | $ 9,578 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 2,558 | 1,960 | |
Buildings and leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 22,952 | 15,445 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 110,159 | $ 119,865 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Changes in Carrying Amount of Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill | |||
Balance at beginning of period | $ 194,052 | $ 194,052 | |
Translation adjustment | 0 | 0 | |
Acquisitions | 90,722 | ||
Impairment | (36,435) | ||
Balance at end of period | 248,339 | 194,052 | $ 194,052 |
Other Intangible Assets | |||
Balance at beginning of period | 52,582 | 67,207 | |
Translation adjustment | (4) | 449 | |
Acquired intangibles | 39,797 | ||
Impairment | 0 | ||
Amortization | (12,287) | (15,074) | (16,586) |
Balance at end of period | 80,088 | 52,582 | 67,207 |
Total | |||
Balance at beginning of period | 246,634 | 261,259 | |
Translation adjustment | (4) | 449 | |
Acquisitions | 130,519 | ||
Impairment | (36,435) | ||
Amortization | (12,287) | (15,074) | (16,586) |
Balance at end of period | $ 328,427 | $ 246,634 | $ 261,259 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill Balance by Reportable Segment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Goodwill [Line Items] | |||
Goodwill | $ 248,339 | $ 194,052 | $ 194,052 |
Service Centers | |||
Goodwill [Line Items] | |||
Goodwill | 231,200 | 160,934 | |
Innovative Pumping Solutions | |||
Goodwill [Line Items] | |||
Goodwill | 0 | 15,980 | |
Supply Chain Services | |||
Goodwill [Line Items] | |||
Goodwill | $ 17,139 | $ 17,138 |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 196,364 | $ 156,567 | |
Accumulated Amortization | (116,276) | (103,985) | |
Carrying Amount, net | 80,088 | 52,582 | $ 67,207 |
Amortization of intangible assets | 12,287 | 15,074 | $ 16,586 |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 193,747 | 156,282 | |
Accumulated Amortization | (116,028) | (103,796) | |
Carrying Amount, net | 77,719 | 52,486 | |
Non-compete agreements | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 2,617 | 285 | |
Accumulated Amortization | (248) | (189) | |
Carrying Amount, net | $ 2,369 | $ 96 |
GOODWILL AND OTHER INTANGIBLE_6
GOODWILL AND OTHER INTANGIBLE ASSETS - Estimated Future Annual Amortization of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||
2021 | $ 15,564 | ||
2022 | 14,223 | ||
2023 | 12,504 | ||
2024 | 10,426 | ||
2025 | 9,023 | ||
Thereafter | 18,348 | ||
Carrying Amount, net | 80,088 | $ 52,582 | $ 67,207 |
Customer relationships | |||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||
Carrying Amount, net | $ 77,719 | 52,486 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization term of acquired intangibles | 7 years 3 months 18 days | ||
Non-compete agreements | |||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||
Carrying Amount, net | $ 2,369 | $ 96 | |
Finite-Lived Intangible Assets [Line Items] | |||
Amortization term of acquired intangibles | 4 years 10 months 24 days |
LONG-TERM DEBT - Components of
LONG-TERM DEBT - Components of Long-term Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Borrowings [Abstract] | ||
Total Debt | $ 330,000 | |
Less: Current maturities | (3,300) | $ (2,500) |
Unamortized debt issuance costs | 9,600 | 6,500 |
Carrying Value | ||
Borrowings [Abstract] | ||
Total Debt | 330,000 | 244,375 |
Less: Current maturities | (3,300) | (2,500) |
Total Long-term Debt | 326,700 | 241,875 |
Carrying Value | ABL Revolver | ||
Borrowings [Abstract] | ||
Total Debt | 0 | 0 |
Carrying Value | Term Loan B | ||
Borrowings [Abstract] | ||
Total Debt | 330,000 | 244,375 |
Fair Value | ||
Borrowings [Abstract] | ||
Total Debt | 325,875 | 244,375 |
Less: Current maturities | (3,259) | (2,500) |
Total Long-term Debt | 322,616 | 241,875 |
Fair Value | ABL Revolver | ||
Borrowings [Abstract] | ||
Total Debt | 0 | 0 |
Fair Value | Term Loan B | ||
Borrowings [Abstract] | ||
Total Debt | $ 325,875 | $ 244,375 |
LONG-TERM DEBT - Asset-Based Lo
LONG-TERM DEBT - Asset-Based Loan Facility (Details) | Mar. 17, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) |
Debt Instrument [Line Items] | |||
Amount outstanding | $ 330,000,000 | ||
Consolidated fixed charge coverage ratio | 3.45 | ||
ABL Revolver | |||
Debt Instrument [Line Items] | |||
Interest rate | 1.90% | 3.50% | |
Revolving Credit Facility | ABL Revolver | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 135,000,000 | $ 85,000,000 | |
Maximum increase in maximum borrowing capacity | 50,000,000 | ||
Available borrowing capacity, including impact of letters of credit | $ 131,900,000 | $ 81,600,000 | |
Amount outstanding | $ 0 | ||
Increment amount to increase maximum under the credit facility | $ 10,000,000 | ||
Unused facility fee percentage | 0.375% | ||
Interest rate | 1.90% | ||
Revolving Credit Facility | ABL Revolver | Minimum | |||
Debt Instrument [Line Items] | |||
Unused facility fee percentage | 0.25% | ||
Revolving Credit Facility | ABL Revolver | Maximum | |||
Debt Instrument [Line Items] | |||
Unused facility fee percentage | 0.375% | ||
Revolving Credit Facility | ABL Revolver | LIBOR or CDOR | Minimum | |||
Debt Instrument [Line Items] | |||
Margin rate | 1.25% | ||
Revolving Credit Facility | ABL Revolver | LIBOR or CDOR | Maximum | |||
Debt Instrument [Line Items] | |||
Margin rate | 1.75% | ||
Revolving Credit Facility | ABL Revolver | Canadian Prime Rate or Canadian Base Rate | Minimum | |||
Debt Instrument [Line Items] | |||
Margin rate | 0.25% | ||
Revolving Credit Facility | ABL Revolver | Canadian Prime Rate or Canadian Base Rate | Maximum | |||
Debt Instrument [Line Items] | |||
Margin rate | 0.75% |
LONG-TERM DEBT - Term Loan B (D
LONG-TERM DEBT - Term Loan B (Details) | Dec. 23, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019 |
Debt Instrument [Line Items] | |||
Consolidated fixed charge coverage ratio | 3.45 | ||
Term Loan B | |||
Debt Instrument [Line Items] | |||
Interest rate | 5.75% | 6.50% | |
Secured Debt | Term Loan B Agreement | |||
Debt Instrument [Line Items] | |||
Term of credit facility | 7 years | ||
Deb instrument face amount | $ 330,000,000 | ||
Percentage of quarterly installment payments | 0.0025 | ||
Maximum increase in maximum borrowing capacity | $ 52,500,000 | ||
Secured leverage ratio | 3.75 | 3.24 | |
Interest rate | 5.75% | ||
Fixed charge coverage ratio | 1 | ||
Maximum consolidated secured debt, net of unrestricted cash | $ 150,000,000 | ||
Secured Debt | Term Loan B Agreement | Total leverage ratio no more than 3.00 to 1.00 | |||
Debt Instrument [Line Items] | |||
Percentage of excess cash flow | 0.50 | ||
Total leverage ratio | 3 | ||
Secured Debt | Term Loan B Agreement | Total leverage ratio no more than 2.50 to 1.00 | |||
Debt Instrument [Line Items] | |||
Percentage of excess cash flow | 0.25 | ||
Total leverage ratio | 2.50 | ||
Secured Debt | Term Loan B Agreement | LIBOR | |||
Debt Instrument [Line Items] | |||
Margin rate | 3.75% | ||
Secured Debt | Term Loan B Agreement | Eurodollar | |||
Debt Instrument [Line Items] | |||
Margin rate | 4.75% | ||
Secured Debt | Term Loan B | |||
Debt Instrument [Line Items] | |||
Loss on extinguishment and modification of debt | $ 2,300,000 |
LONG-TERM DEBT - Secured Levera
LONG-TERM DEBT - Secured Leverage Ratio to EBITDA (Details) - Secured Debt - Term Loan B Agreement | Dec. 23, 2020 |
December 31, 2020 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.75 |
March 31, 2021 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.75 |
June 30, 2021 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.75 |
September 30, 2021 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.50 |
December 31, 2021 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.50 |
March 31, 2022 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.25 |
June 30, 2022 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.25 |
September 30, 2022 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5.25 |
December 31, 2022 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5 |
March 31, 2023 | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 5 |
June 30, 2023 and each Fiscal Quarter thereafter | |
Debt Instrument [Line Items] | |
Secured Leverage Ratio | 4.75 |
LONG-TERM DEBT - Interest Rate
LONG-TERM DEBT - Interest Rate on Borrowings Outstanding (Details) | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Weighted average interest rate | 5.75% | 6.50% |
ABL Revolver | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.90% | 3.50% |
Term Loan B | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.75% | 6.50% |
LONG-TERM DEBT - Extinguishment
LONG-TERM DEBT - Extinguishment and Modification of Previously Existing Credit Agreement (Details) - Original Term Loan Agreement - Secured Debt $ in Millions | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 23, 2020USD ($)rate | |
Debt Instrument [Line Items] | ||
Deferred financing costs | $ 3 | |
Original issue discount | $ 4.1 | |
Write-off of debt issuance costs and third-party fees | $ 5.4 | |
Discounted cash flow | ||
Debt Instrument [Line Items] | ||
Debt measurement input | rate | 0.10 |
LONG-TERM DEBT - Maturities of
LONG-TERM DEBT - Maturities of Long-term Debt (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 3,300 |
2022 | 3,300 |
2023 | 3,300 |
2024 | 3,300 |
2025 | 3,300 |
Thereafter | 313,500 |
Total Debt | $ 330,000 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income (Loss) Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (32,440) | $ 41,184 | $ 46,270 |
Foreign | (15,075) | 5,485 | 2,436 |
Income (loss) before income taxes | $ (47,515) | $ 46,669 | $ 48,706 |
INCOME TAXES - Provision for In
INCOME TAXES - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current - | |||
Federal | $ (6,179) | $ 4,940 | $ 7,295 |
State | (154) | 1,862 | 2,257 |
Foreign | 2,663 | 2,982 | 2,629 |
Total current | (3,670) | 9,784 | 12,181 |
Deferred - | |||
Federal | (10,568) | 2,618 | 2,389 |
State | (3,125) | (224) | 123 |
Foreign | (1,078) | (1,284) | (1,508) |
Total deferred | (14,771) | 1,110 | 1,004 |
Total income tax expense (benefit) | $ (18,441) | $ 10,894 | $ 13,185 |
INCOME TAXES - Differences Betw
INCOME TAXES - Differences Between Income Taxes Computed at Statutory Income Tax Rate and Provision For Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Income taxes computed at federal statutory rate | $ (9,978) | $ 9,801 | $ 10,228 |
State income taxes, net of federal benefit | (2,591) | 1,294 | 1,880 |
Foreign taxes | (492) | 311 | 150 |
Nondeductible expenses | 5,617 | 1,108 | 954 |
Enacted rate changes | 670 | 0 | 0 |
Research and development tax credit | (16,878) | (2,324) | (480) |
Foreign tax credit | 0 | (57) | (346) |
Valuation allowance | 16 | (5) | 0 |
Tax reform deferred tax remeasurement | 0 | 0 | 81 |
Deferred tax liability true up | (551) | 1,065 | 0 |
Uncertain tax positions | 5,057 | 665 | 172 |
Other | 689 | (964) | 546 |
Total income tax expense (benefit) | $ (18,441) | $ 10,894 | $ 13,185 |
INCOME TAXES - Deferred Tax Lia
INCOME TAXES - Deferred Tax Liabilities and Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 1,784 | $ 1,657 |
Inventory | 7,073 | 3,254 |
Research and development credit carryforward | 8,407 | 1,361 |
Foreign tax credit carryforward | 64 | 64 |
Net operating loss carryforward | 802 | 812 |
Capital loss carryforward | 12,813 | 12,363 |
Deferred compensation | 540 | 0 |
Accruals | 5,690 | 4,077 |
Investment in partnerships | 319 | 500 |
Other | 312 | 0 |
Total deferred tax assets | 37,804 | 24,088 |
Less valuation allowance | (12,813) | (12,363) |
Total deferred tax asset, net of valuation deferred tax liabilities : | 24,991 | 11,725 |
Goodwill | (8,570) | (8,459) |
Intangibles | (8,512) | (2,051) |
Property and equipment | (7,569) | (8,319) |
ROU asset and liability | (323) | 0 |
Unremitted foreign earnings | (421) | (421) |
Deferred compensation | 0 | (317) |
Method changes | (754) | (1,961) |
Other | (619) | (69) |
Net deferred tax liability | $ (1,777) | $ (9,872) |
INCOME TAXES - Changes in Valua
INCOME TAXES - Changes in Valuation Allowance for Deferred Tax Assets (Details) - Valuation Allowance, Deferred Tax Asset - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at January 1 | $ (12,363) | $ (12,564) | $ (12,220) |
Changes due to federal and foreign capital loss carryforwards | (450) | 201 | (344) |
Balance at December 31 | $ (12,813) | $ (12,363) | $ (12,564) |
INCOME TAXES - Changes in Unrec
INCOME TAXES - Changes in Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at January 1 | $ 0 | $ 0 | $ 0 |
Increases related to prior year tax positions | (5,057) | 0 | 0 |
Decreases related to prior year tax positions | 0 | 0 | 0 |
Increases related to current year tax positions | 0 | 0 | 0 |
Settlements | 0 | 0 | 0 |
Lapse of statute of limitations | 0 | 0 | 0 |
Balance at December 31 | $ (5,057) | $ 0 | $ 0 |
INCOME TAXES - Tax Carryforward
INCOME TAXES - Tax Carryforwards (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Domestic | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss | $ 388 |
Domestic | Capital Loss Carryforward | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | 12,809 |
Domestic | Research and Devolopment | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | 4,467 |
Domestic | Research and Devolopment | Texas | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | 3,700 |
Domestic | Research and Devolopment | LOUISIANA | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | 239 |
Domestic | Foreign Tax Credit | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | 64 |
Foreign | |
Operating Loss Carryforwards [Line Items] | |
Net operating loss | 414 |
Foreign | Capital Loss Carryforward | |
Operating Loss Carryforwards [Line Items] | |
Tax credits | $ 4 |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Total tax benefit related to federal and state research and development | $ (16,878,000) | $ (2,324,000) | $ (480,000) | |
Benefit for uncertain tax positions | 5,057,000 | $ 0 | $ 0 | $ 0 |
Tax expense for interest and penalties related to uncertain tax positions | $ 0 |
SHARE-BASED COMPENSATION - Narr
SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Millions | Jun. 19, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 20, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average period over which compensation costs are expected to be recognized | 1 year 6 months | ||||
Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation expense | $ 3.5 | $ 2 | $ 2.1 | ||
Income tax benefit recognized in earnings for benefit compensation | 0.9 | 0.5 | 0.5 | ||
2016 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized for issuance (in shares) | 1,000,000 | 500,000 | |||
Increase in number of shares authorized for grant (in shares) | 500,000 | ||||
Unrecognized compensation expense | $ 2.2 | $ 3 | $ 3.6 | ||
2016 Plan | Restricted Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentages of vesting for one year | 100.00% | ||||
Percentages of vesting for two years | 50.00% | ||||
Percentages of vesting for three years | 33.30% | ||||
Percentages of vesting for five years | 20.00% | ||||
Percentages of vesting for ten years | 10.00% | ||||
Number of shares available for future grant (in shares) | 612,692 | ||||
2016 Plan | Restricted Stock | Non-Employee Directors | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting period | 1 year | ||||
2016 Plan | Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized for issuance (in shares) | 1,000,000 |
SHARE-BASED COMPENSATION - Chan
SHARE-BASED COMPENSATION - Changes in Restricted Stock (Details) - Restricted Stock - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Shares | |||
Non-vested, beginning balance (in shares) | 144,250 | 169,293 | 77,901 |
Granted (in shares) | 100,299 | 46,885 | 131,413 |
Forfeited (in shares) | (16,794) | (5,720) | (2,400) |
Vested (in shares) | (60,779) | (66,208) | (37,621) |
Non-vested, ending balance (in shares) | 166,976 | 144,250 | 169,293 |
Weighted Average Grant Price | |||
Non-vested, beginning balance (in dollars per share) | $ 32.71 | $ 31.05 | $ 30.36 |
Granted (in dollars per share) | 30.91 | 35.60 | 31.92 |
Forfeited (in dollars per share) | 28.61 | 32.35 | 46.68 |
Vested (in dollars per share) | 31.33 | 27.75 | 31.68 |
Non-vested, ending balance (in dollars per share) | $ 32.53 | $ 32.71 | $ 31.05 |
EARNINGS PER SHARE DATA - Compu
EARNINGS PER SHARE DATA - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Basic: | |||||||||||||||
Weighted average shares outstanding (in shares) | 17,748 | 17,592 | 17,553 | ||||||||||||
Net income (loss) attributable to DXP Enterprises, Inc. | $ (1,900) | $ (34,700) | $ 2,100 | $ 5,700 | $ 2,200 | $ 13,100 | $ 13,400 | $ 7,300 | $ 11,100 | $ 8,400 | $ 11,600 | $ 4,600 | $ (28,726) | $ 36,035 | $ 35,632 |
Convertible preferred stock dividend | (90) | (90) | (90) | ||||||||||||
Net income (loss) attributable to common shareholders | $ (28,816) | $ 35,945 | $ 35,542 | ||||||||||||
Per share amount (in dollars per share) | $ (0.11) | $ (1.95) | $ 0.12 | $ 0.31 | $ 0.12 | $ 0.74 | $ 0.76 | $ 0.41 | $ 0.63 | $ 0.48 | $ 0.66 | $ 0.26 | $ (1.62) | $ 2.04 | $ 2.02 |
Diluted: | |||||||||||||||
Weighted average shares outstanding (in shares) | 17,748 | 17,592 | 17,553 | ||||||||||||
Assumed conversion of convertible preferred stock (in shares) | 0 | 840 | 840 | ||||||||||||
Total dilutive shares (in shares) | 17,748 | 18,432 | 18,393 | ||||||||||||
Net income (loss) attributable to common shareholders | $ (28,816) | $ 35,945 | $ 35,542 | ||||||||||||
Convertible preferred stock dividend | 0 | 90 | 90 | ||||||||||||
Net income (loss) attributable to DXP Enterprises, Inc. | $ (28,816) | $ 36,035 | $ 35,632 | ||||||||||||
Per share amount (in dollars per share) | $ (0.11) | $ (1.95) | $ 0.12 | $ 0.31 | $ 0.12 | $ 0.71 | $ 0.73 | $ 0.40 | $ 0.60 | $ 0.46 | $ 0.63 | $ 0.25 | $ (1.62) | $ 1.96 | $ 1.94 |
EARNINGS PER SHARE DATA - Narra
EARNINGS PER SHARE DATA - Narrative (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Convertible preferred stock (in shares) | 0 | 840,000 | 840,000 |
Preferred Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share (in shares) | 840,000 |
CAPITAL STOCK - Narrative (Deta
CAPITAL STOCK - Narrative (Details) | 12 Months Ended | ||
Dec. 31, 2020rate$ / sharesshares | Dec. 31, 2019shares | Dec. 31, 2018shares | |
Class of Stock [Line Items] | |||
Treasury shares outstanding (in shares) | 0 | 0 | 0 |
Series A preferred stock | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 1,122 | 1,122 | 1,122 |
Preferred stock, liquidation preference per share (in dollars per share) | $ / shares | $ 100 | ||
Preferred stock, votes per each share | rate | 0.10 | ||
Series B Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred stock, shares outstanding (in shares) | 15,000 | 15,000 | 15,000 |
Series B convertible preferred stock | |||
Class of Stock [Line Items] | |||
Preferred stock, liquidation preference per share (in dollars per share) | $ / shares | $ 100 | ||
Convertible preferred stock, shares Issued upon conversion (in shares) | 56 | ||
Preferred stock, dividend rate per share (in dollars per share) | $ / shares | $ 0.50 | ||
Preferred stock, votes per each share | rate | 0.10 |
CAPITAL STOCK - Activity of Com
CAPITAL STOCK - Activity of Common Stock Outstanding (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Common Stock: | |||
Balance, beginning of period (in shares) | 17,604,092 | ||
Balance, end of period (in shares) | 19,208,067 | 17,604,092 | |
Common Stock | |||
Common Stock: | |||
Balance, beginning of period (in shares) | 17,460,000 | 17,401,000 | 17,316,000 |
Issuance of shares for compensation net of withholding (in shares) | 54,000 | 59,000 | 85,000 |
Issuance of common stock related to equity distribution agreements (in shares) | 46,000 | 0 | 0 |
Issuance of common stock related to purchase of businesses (in shares) | 1,481,000 | 0 | 0 |
Balance, end of period (in shares) | 19,041,000 | 17,460,000 | 17,401,000 |
SALES OF COMMON STOCK (Details)
SALES OF COMMON STOCK (Details) - USD ($) | May 11, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Equity Distribution Agreement | Distribution Agent | |||
Class of Stock [Line Items] | |||
Common stock, par value (in dollars per share) | $ 0.01 | ||
Equity Distribution Agreement | Distribution Agent | Common Stock | |||
Class of Stock [Line Items] | |||
Aggregate offering amount (up to) | $ 37,500,000 | ||
Number of shares of common stock issued and sold (in shares) | 46,000 | ||
Net proceeds on sale of common stock | $ 1,100,000 | ||
Distribution agent's commissions on sale of common stock | $ 26,000 |
BUSINESS ACQUISITIONS - Narrati
BUSINESS ACQUISITIONS - Narrative (Details) | Dec. 31, 2020USD ($) | Feb. 01, 2020USD ($) | Jan. 01, 2020USD ($) | Jan. 01, 2018USD ($) | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2020USD ($) |
Business Acquisition [Line Items] | ||||||||
Cash consideration paid | $ 115,247,000 | $ 0 | $ 10,811,000 | |||||
Acquired intangibles | 39,797,000 | |||||||
Goodwill | $ 248,339,000 | 248,339,000 | 194,052,000 | $ 194,052,000 | $ 248,339,000 | |||
Service Centers | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 231,200,000 | $ 231,200,000 | 160,934,000 | 231,200,000 | ||||
Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Amortization term of acquired intangibles | 4 years 10 months 24 days | |||||||
Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Amortization term of acquired intangibles | 7 years 3 months 18 days | |||||||
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Contingent Consideration Liability | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of contingent consideration liability | 1,100,000 | $ 1,100,000 | $ 2,705,000 | 1,100,000 | ||||
2020 Acquisitions | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration paid | 115,247,000 | |||||||
Acquired intangibles | 39,800,000 | |||||||
Goodwill | 90,722,000 | 90,722,000 | 90,722,000 | |||||
Fair value of accounts receivable acquired | 20,204,000 | 20,204,000 | 20,204,000 | |||||
Gross contractual amount of receivables acquired | 21,100,000 | 21,100,000 | 21,100,000 | |||||
Receivables acquired expected to be uncollectible | 900,000 | 900,000 | 900,000 | |||||
Acquisition related costs | 172,000 | |||||||
Fair value of stock issued in acquisition | 29,367,000 | |||||||
2020 Acquisitions | Service Centers | ||||||||
Business Acquisition [Line Items] | ||||||||
Goodwill | 90,700,000 | 90,700,000 | 90,700,000 | |||||
Goodwill expected to be deductible for tax purposes | 0 | 0 | 0 | |||||
2020 Acquisitions | Non-compete agreements | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangibles | $ 2,300,000 | |||||||
Amortization term of acquired intangibles | 5 years | |||||||
2020 Acquisitions | Customer relationships | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquired intangibles | $ 37,500,000 | |||||||
Amortization term of acquired intangibles | 8 years | |||||||
2020 Acquisitions | Common Stock | ||||||||
Business Acquisition [Line Items] | ||||||||
Number of shares issued in acquisitions (in shares) | shares | 1,480,909 | |||||||
TEC | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | 64,700,000 | |||||||
APO | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | 38,300,000 | |||||||
Pumping Solutions | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | 21,000,000 | |||||||
CEC | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | 4,500,000 | |||||||
PSI and Turbo | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of revenue contributed by acquisitions | 0.019 | |||||||
Percentage of net income (loss) contributed by acquisitions | (0.029) | |||||||
Sales contributed by acquiree since acquisition | $ 19,600,000 | |||||||
Earnings before taxes contributed by acquiree since acquisition | 800,000 | |||||||
Turbo | ||||||||
Business Acquisition [Line Items] | ||||||||
Cash consideration paid | $ 3,200,000 | |||||||
Additional goodwill recognized from acquisitions | 0 | |||||||
PSI | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | $ 13,000,000 | |||||||
Additional goodwill recognized from acquisitions | 463,000 | |||||||
ASI | ||||||||
Business Acquisition [Line Items] | ||||||||
Purchase price acquisition in cash and stock | $ 11,700,000 | |||||||
Cash consideration paid | 10,800,000 | |||||||
Liability for contingent consideration | 4,600,000 | |||||||
Fair value of stock issued in acquisition | 900,000 | |||||||
Contingent consideration, maximum | $ 4,600,000 | |||||||
Payment period for contingent consideration | 3 years | |||||||
Contingent consideration liability, current | 1,100,000 | 1,100,000 | 1,100,000 | |||||
ASI | Fair Value, Inputs, Level 3 | ||||||||
Business Acquisition [Line Items] | ||||||||
Contingent consideration, maximum | $ 4,000,000 | |||||||
ASI | Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3 | Contingent Consideration Liability | ||||||||
Business Acquisition [Line Items] | ||||||||
Fair value of contingent consideration liability | $ 1,100,000 | $ 1,100,000 | $ 1,100,000 |
BUSINESS ACQUISITIONS - Total C
BUSINESS ACQUISITIONS - Total Consideration Transferred and Aggregate Amount of Assets Acquired and Liabilities Assumed for 2020 Acquisitions (Details) - USD ($) $ in Thousands | 12 Months Ended | 36 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||||
Cash payments | $ 115,247 | $ 0 | $ 10,811 | |
Goodwill | 248,339 | $ 194,052 | $ 194,052 | $ 248,339 |
2020 Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Cash payments | 115,247 | |||
Fair value of stock issued (1,480,909 shares) | 29,367 | |||
Total consideration transferred | 144,614 | |||
Cash | 1 | 1 | ||
Accounts Receivable | 20,204 | 20,204 | ||
Inventory | 8,567 | 8,567 | ||
Other Current Assets | 190 | 190 | ||
Property and equipment | 1,811 | 1,811 | ||
Goodwill | 90,722 | 90,722 | ||
Other assets | 696 | 696 | ||
Assets acquired | 161,988 | 161,988 | ||
Current liabilities assumed | (10,674) | (10,674) | ||
Deferred tax liability | (6,700) | (6,700) | ||
Net assets acquired | 144,614 | 144,614 | ||
2020 Acquisitions | Non-compete agreements | ||||
Business Acquisition [Line Items] | ||||
Finite-lived intangibles | 2,332 | 2,332 | ||
2020 Acquisitions | Customer relationships | ||||
Business Acquisition [Line Items] | ||||
Finite-lived intangibles | $ 37,465 | $ 37,465 | ||
2020 Acquisitions | Common Stock | ||||
Business Acquisition [Line Items] | ||||
Stock issued (in shares) | 1,480,909 |
BUSINESS ACQUISITIONS - Pro For
BUSINESS ACQUISITIONS - Pro Forma Information (Details) - 2020 Acquisitions - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | ||
Revenue | $ 1,129,610 | $ 1,423,805 |
Net income (loss) | $ (15,148) | $ 41,219 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Leases | |||
2021 | $ 19,183 | ||
2022 | 15,990 | ||
2023 | 10,571 | ||
2024 | 6,084 | ||
2025 | 3,924 | ||
Thereafter | 7,271 | ||
Total lease payments | 63,023 | ||
Lease expenses | $ 23,400 | $ 25,000 | |
Rental expense for operating leases | $ 18,500 |
EMPLOYEE BENEFIT PLANS (Details
EMPLOYEE BENEFIT PLANS (Details) - United States - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||||
Company match to employee contributions | 50.00% | ||||
Percentage of salary which is matched | 4.00% | ||||
Employer contributions to 401(k) plan | $ 700,000 | $ 0 | $ 700,000 | $ 1,700,000 | $ 1,800,000 |
OTHER COMPREHENSIVE INCOME (Det
OTHER COMPREHENSIVE INCOME (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USD ($)entity | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Equity [Abstract] | |||
Number of companies that operate in Canada | entity | 4 | ||
Cumulative translation adjustments, net of tax | $ | $ (1,888) | $ (687) | $ 224 |
SEGMENT AND GEOGRAPHICAL REPO_3
SEGMENT AND GEOGRAPHICAL REPORTING - Financial Information of Company's Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | $ 232,700 | $ 220,200 | $ 251,400 | $ 301,000 | $ 295,500 | $ 327,200 | $ 333,300 | $ 311,200 | $ 311,000 | $ 308,000 | $ 311,200 | $ 285,900 | $ 1,005,266 | $ 1,267,189 | $ 1,216,197 |
Operating income for reportable segments, excluding adjustments | 102,318 | 130,118 | 130,865 | ||||||||||||
Identifiable assets at year end | 737,731 | 731,392 | 645,226 | 737,731 | 731,392 | 645,226 | |||||||||
Capital expenditures | 5,711 | 12,602 | 8,751 | ||||||||||||
Proceeds from sale of fixed assets | 0 | 35 | |||||||||||||
Depreciation | 8,127 | 8,404 | 8,087 | ||||||||||||
Amortization of intangibles | 12,287 | 15,074 | 16,586 | ||||||||||||
Interest expense | 20,571 | 19,498 | 20,937 | ||||||||||||
Product sales | Recognized at a point in time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 733,967 | 888,509 | 846,079 | ||||||||||||
Inventory management services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 16,005 | 16,511 | 13,686 | ||||||||||||
Staffing services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 67,303 | 58,514 | 64,735 | ||||||||||||
Customized pump production | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 187,991 | 303,655 | 291,697 | ||||||||||||
Service Centers | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 662,617 | 762,256 | 750,044 | ||||||||||||
Operating income for reportable segments, excluding adjustments | 70,385 | 86,778 | 80,718 | ||||||||||||
Identifiable assets at year end | 550,505 | 462,663 | 402,944 | 550,505 | 462,663 | 402,944 | |||||||||
Capital expenditures | 1,254 | 2,333 | 1,655 | ||||||||||||
Proceeds from sale of fixed assets | 0 | 35 | |||||||||||||
Depreciation | 3,299 | 3,517 | 3,974 | ||||||||||||
Amortization of intangibles | 6,989 | 8,230 | 9,272 | ||||||||||||
Interest expense | 11,506 | 10,786 | 11,178 | ||||||||||||
Service Centers | Product sales | Recognized at a point in time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 595,314 | 703,742 | 685,309 | ||||||||||||
Service Centers | Inventory management services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Service Centers | Staffing services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 67,303 | 58,514 | 64,735 | ||||||||||||
Service Centers | Customized pump production | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Innovative Pumping Solutions | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 187,991 | 303,655 | 291,697 | ||||||||||||
Operating income for reportable segments, excluding adjustments | 18,715 | 28,895 | 33,943 | ||||||||||||
Identifiable assets at year end | 130,505 | 212,015 | 188,765 | 130,505 | 212,015 | 188,765 | |||||||||
Capital expenditures | 4,457 | 9,347 | 6,800 | ||||||||||||
Proceeds from sale of fixed assets | 0 | 0 | |||||||||||||
Depreciation | 4,441 | 4,602 | 4,064 | ||||||||||||
Amortization of intangibles | 5,298 | 5,855 | 6,237 | ||||||||||||
Interest expense | 7,360 | 6,747 | 7,351 | ||||||||||||
Innovative Pumping Solutions | Product sales | Recognized at a point in time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Innovative Pumping Solutions | Inventory management services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Innovative Pumping Solutions | Staffing services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Innovative Pumping Solutions | Customized pump production | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 187,991 | 303,655 | 291,697 | ||||||||||||
Supply Chain Services | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 154,658 | 201,278 | 174,456 | ||||||||||||
Operating income for reportable segments, excluding adjustments | 13,218 | 14,445 | 16,204 | ||||||||||||
Identifiable assets at year end | $ 56,721 | $ 56,714 | $ 53,517 | 56,721 | 56,714 | 53,517 | |||||||||
Capital expenditures | 0 | 922 | 296 | ||||||||||||
Proceeds from sale of fixed assets | 0 | 0 | |||||||||||||
Depreciation | 387 | 285 | 49 | ||||||||||||
Amortization of intangibles | 0 | 989 | 1,077 | ||||||||||||
Interest expense | 1,705 | 1,965 | 2,408 | ||||||||||||
Supply Chain Services | Product sales | Recognized at a point in time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 138,653 | 184,767 | 160,770 | ||||||||||||
Supply Chain Services | Inventory management services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 16,005 | 16,511 | 13,686 | ||||||||||||
Supply Chain Services | Staffing services | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 0 | 0 | 0 | ||||||||||||
Supply Chain Services | Customized pump production | Recognized over time | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | $ 0 | $ 0 | $ 0 |
SEGMENT AND GEOGRAPHICAL REPO_4
SEGMENT AND GEOGRAPHICAL REPORTING - Reconciliation of Operating Income to Consolidated Income (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Operating income for reportable segments, excluding adjustments | $ 102,318 | $ 130,118 | $ 130,865 |
Adjustments for: | |||
Amortization of intangibles | 12,287 | 15,074 | 16,586 |
Impairment and other charges | 59,883 | 0 | 0 |
Total operating income | (26,870) | 66,122 | 68,451 |
Interest expense | 20,571 | 19,498 | 20,937 |
Other expense (income), net | 74 | (45) | (1,192) |
Income (loss) before income taxes | (47,515) | 46,669 | 48,706 |
Operating Segments | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Operating income for reportable segments, excluding adjustments | 102,318 | 130,118 | 130,865 |
Segment Reconciling Items | |||
Adjustments for: | |||
Amortization of intangibles | 12,287 | 15,074 | 16,586 |
Impairment and other charges | 59,883 | 0 | 0 |
Corporate | |||
Adjustments for: | |||
Corporate and other expense, net | $ 57,018 | $ 48,922 | $ 45,828 |
SEGMENT AND GEOGRAPHICAL REPO_5
SEGMENT AND GEOGRAPHICAL REPORTING - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Identifiable assets at year end | $ 851,861 | $ 788,220 | |
Depreciation | 10,396 | 10,100 | $ 9,578 |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 1,000 | 9,500 | 600 |
Identifiable assets at year end | 114,100 | 56,800 | 54,700 |
Depreciation | $ 2,300 | $ 1,700 | $ 1,500 |
SEGMENT AND GEOGRAPHICAL REPO_6
SEGMENT AND GEOGRAPHICAL REPORTING - Revenues by Geographical Location (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | $ 232,700 | $ 220,200 | $ 251,400 | $ 301,000 | $ 295,500 | $ 327,200 | $ 333,300 | $ 311,200 | $ 311,000 | $ 308,000 | $ 311,200 | $ 285,900 | $ 1,005,266 | $ 1,267,189 | $ 1,216,197 |
Reportable Geographical Components | United States | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 931,000 | 1,165,000 | 1,110,000 | ||||||||||||
Reportable Geographical Components | Canada | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | 74,000 | 102,000 | 106,000 | ||||||||||||
Reportable Geographical Components | Other | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Total revenue | $ 0 | $ 0 | $ 0 |
SEGMENT AND GEOGRAPHICAL REPO_7
SEGMENT AND GEOGRAPHICAL REPORTING - Property and Equipment by Geographical Location (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Segment Reporting Information [Line Items] | ||
Property and equipment, net | $ 56,899 | $ 63,703 |
Reportable Geographical Components | United States | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net | 52,000 | 56,000 |
Reportable Geographical Components | Canada | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net | 5,000 | 8,000 |
Reportable Geographical Components | Other | ||
Segment Reporting Information [Line Items] | ||
Property and equipment, net | $ 0 | $ 0 |
QUARTERLY FINANCIAL INFORMATI_3
QUARTERLY FINANCIAL INFORMATION (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||
Sales | $ 232,700 | $ 220,200 | $ 251,400 | $ 301,000 | $ 295,500 | $ 327,200 | $ 333,300 | $ 311,200 | $ 311,000 | $ 308,000 | $ 311,200 | $ 285,900 | $ 1,005,266 | $ 1,267,189 | $ 1,216,197 |
Gross profit | 64,300 | 61,300 | 70,000 | 84,000 | 78,300 | 92,700 | 92,000 | 84,200 | 86,600 | 84,100 | 85,100 | 76,400 | 279,269 | 347,224 | 332,208 |
Net income | (2,000) | (34,700) | 2,100 | 5,700 | 2,100 | 13,200 | 13,400 | 7,300 | 11,100 | 8,400 | 11,600 | 4,500 | (29,074) | 35,775 | 35,521 |
Net income (loss) attributable to DXP Enterprises, Inc. | $ (1,900) | $ (34,700) | $ 2,100 | $ 5,700 | $ 2,200 | $ 13,100 | $ 13,400 | $ 7,300 | $ 11,100 | $ 8,400 | $ 11,600 | $ 4,600 | $ (28,726) | $ 36,035 | $ 35,632 |
Basic (in dollars per share) | $ (0.11) | $ (1.95) | $ 0.12 | $ 0.31 | $ 0.12 | $ 0.74 | $ 0.76 | $ 0.41 | $ 0.63 | $ 0.48 | $ 0.66 | $ 0.26 | $ (1.62) | $ 2.04 | $ 2.02 |
Diluted (in dollars per share) | $ (0.11) | $ (1.95) | $ 0.12 | $ 0.31 | $ 0.12 | $ 0.71 | $ 0.73 | $ 0.40 | $ 0.60 | $ 0.46 | $ 0.63 | $ 0.25 | $ (1.62) | $ 1.96 | $ 1.94 |
RELATED PARTIES DISCLOSURES (De
RELATED PARTIES DISCLOSURES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | ||
Lease expenses | $ 23,400,000 | $ 25,000,000 |
Minimum | ||
Related Party Transaction [Line Items] | ||
Amount of transaction with related party | 120,000 | |
Chief Executive Officer | ||
Related Party Transaction [Line Items] | ||
Lease expenses | $ 3,100,000 |