Cover page
Cover page - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 01, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 000-50796 | |
Entity Registrant Name | SP Plus Corporation | |
Entity Central Index Key | 0001059262 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1171179 | |
Entity Address, Address Line One | 200 E. Randolph Street, Suite 7700 | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60601-7702 | |
City Area Code | 312 | |
Local Phone Number | 274-2000 | |
Title of 12(b) Security | Common Stock, $0.001 par value per share | |
Trading Symbol | SP | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 19,649,611 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Assets | ||
Cash and cash equivalents | $ 38.5 | $ 12.4 |
Accounts receivable, net | 184.4 | 167.7 |
Prepaid expenses and other current assets | 13.1 | 16.7 |
Total current assets | 236 | 196.8 |
Property and equipment, net | 66 | 60.2 |
Right-of-use assets | 173.7 | 166.9 |
Goodwill | 544.2 | 543.2 |
Other intangible assets, net | 62.3 | 68.9 |
Deferred income taxes | 42.5 | 44.4 |
Other noncurrent assets, net | 43.6 | 41 |
Total noncurrent assets | 932.3 | 924.6 |
Total assets | 1,168.3 | 1,121.4 |
Liabilities | ||
Accounts payable | 142.7 | 133.4 |
Accrued and other current liabilities | 128.9 | 137.6 |
Short-term lease liabilities | 56.4 | 60.2 |
Current portion of long-term borrowings | 14.7 | 12.4 |
Total current liabilities | 342.7 | 343.6 |
Long-term borrowings, excluding current portion | 345.1 | 331.8 |
Long-term lease liabilities | 154.9 | 158.5 |
Other noncurrent liabilities | 73.5 | 61.8 |
Total noncurrent liabilities | 573.5 | 552.1 |
Total liabilities | 916.2 | 895.7 |
Stockholders’ equity | ||
Preferred stock, par value $0.01 per share; 5,000,000 shares authorized as of September 30, 2023 and December 31, 2022, respectively; no shares issued or outstanding | 0 | 0 |
Common stock, par value $0.001 per share; 50,000,000 shares authorized as of September 30, 2023 and December 31, 2022; 23,444,353 and 19,649,611 shares issued and outstanding as of September 30, 2023, respectively, and 23,276,329 and 19,767,287 shares issued and outstanding as of December 31, 2022, respectively | 0 | 0 |
Treasury stock, at cost; 3,794,742 and 3,509,042 shares as of September 30, 2023 and December 31, 2022, respectively | (130.5) | (120) |
Additional paid-in capital | 281.1 | 274.2 |
Accumulated other comprehensive loss | (2) | (1.8) |
Retained earnings | 103.5 | 73.6 |
Total SP Plus Corporation stockholders’ equity | 252.1 | 226 |
Noncontrolling interests | (0.3) | |
Total stockholders’ equity | 252.1 | 225.7 |
Total liabilities and stockholders’ equity | $ 1,168.3 | $ 1,121.4 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 23,444,353 | 23,276,329 |
Common stock, shares outstanding (in shares) | 19,649,611 | 19,767,287 |
Treasury stock, shares (in shares) | 3,794,742 | 3,509,042 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Services revenue | $ 460.7 | $ 404.4 | $ 1,328.2 | $ 1,135.2 |
Cost of services (exclusive of depreciation and amortization) | 393.1 | 346.2 | 1,136.4 | 966.8 |
General and administrative expenses | 37.6 | 27.2 | 100 | 78.4 |
Depreciation and amortization | 9 | 7.2 | 26.2 | 20.5 |
Operating income | 21 | 23.8 | 65.6 | 69.5 |
Other expense (income) | ||||
Interest expense | 7.4 | 3.9 | 21.5 | 12.2 |
Interest income | (0.1) | (0.2) | (0.4) | |
Total other expenses | 7.4 | 3.8 | 21.3 | 11.8 |
Earnings before income taxes | 13.6 | 20 | 44.3 | 57.7 |
Income tax expense | 3.5 | 4.9 | 11.6 | 15 |
Net income | 10.1 | 15.1 | 32.7 | 42.7 |
Less: Net income attributable to noncontrolling interests | 0.9 | 0.8 | 2.8 | 2.3 |
Net income attributable to SP Plus Corporation | $ 9.2 | $ 14.3 | $ 29.9 | $ 40.4 |
Net income per common share | ||||
Basic (in dollars per share) | $ 0.47 | $ 0.69 | $ 1.52 | $ 1.92 |
Diluted (in dollars per share) | $ 0.46 | $ 0.68 | $ 1.5 | $ 1.90 |
Weighted average shares outstanding | ||||
Basic (in shares) | 19,649,611 | 20,744,813 | 19,660,930 | 21,054,095 |
Diluted (in shares) | 19,910,308 | 20,977,667 | 19,874,165 | 21,223,982 |
Lease and Management Type Contracts | ||||
Services revenue | $ 228.4 | $ 207.1 | $ 666 | $ 588 |
Cost of services (exclusive of depreciation and amortization) | 160.8 | 148.9 | 474.2 | 419.6 |
Management Type Contracts | ||||
Services revenue | 153.5 | 134.9 | 446.6 | 382.6 |
Cost of services (exclusive of depreciation and amortization) | 99.9 | 89.9 | 295.8 | 252.7 |
Lease Type Contracts | ||||
Services revenue | 74.9 | 72.2 | 219.4 | 205.4 |
Cost of services (exclusive of depreciation and amortization) | 60.9 | 59 | 178.4 | 166.9 |
Reimbursed Management Type Contract Revenue | ||||
Services revenue | 232.3 | 197.3 | 662.2 | 547.2 |
Cost of services (exclusive of depreciation and amortization) | $ 232.3 | $ 197.3 | $ 662.2 | $ 547.2 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 10.1 | $ 15.1 | $ 32.7 | $ 42.7 |
Reclassification of de-designated interest rate collars | 0.5 | |||
Foreign currency translation loss | (0.9) | (0.6) | (0.2) | (0.7) |
Comprehensive income | 9.2 | 14.5 | 32.5 | 42.5 |
Less: Comprehensive income attributable to noncontrolling interests | 0.9 | 0.8 | 2.8 | 2.3 |
Comprehensive income attributable to SP Plus Corporation | $ 8.3 | $ 13.7 | $ 29.7 | $ 40.2 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Retained Earnings (Accumulated Deficit) | Treasury Stock | Noncontrolling Interests |
Beginning balance (deficit) at Dec. 31, 2021 | $ 222.1 | $ 267.5 | $ (2.8) | $ 28.4 | $ (70.6) | $ (0.4) | |
Beginning balance (deficit) (in shares) at Dec. 31, 2021 | 23,224,459 | ||||||
Net income | 11.3 | 10.7 | 0.6 | ||||
Foreign currency translation | 0.1 | 0.1 | |||||
Reclassification of de-designated interest rate collars | 0.4 | 0.4 | |||||
Issuance of restricted stock units (in shares) | 37,235 | ||||||
Non-cash stock-based compensation | 1.8 | 1.8 | |||||
Distributions to noncontrolling interests | (0.5) | (0.5) | |||||
Ending balance (deficit) at Mar. 31, 2022 | 235.2 | 269.3 | (2.3) | 39.1 | (70.6) | (0.3) | |
Ending balance (deficit) (in shares) at Mar. 31, 2022 | 23,261,694 | ||||||
Beginning balance (deficit) at Dec. 31, 2021 | 222.1 | 267.5 | (2.8) | 28.4 | (70.6) | (0.4) | |
Beginning balance (deficit) (in shares) at Dec. 31, 2021 | 23,224,459 | ||||||
Net income | 42.7 | ||||||
Foreign currency translation | (0.7) | ||||||
Reclassification of de-designated interest rate collars | 0.5 | ||||||
Ending balance (deficit) at Sep. 30, 2022 | 241.6 | 274.1 | (3) | 68.8 | (98.2) | (0.1) | |
Ending balance (deficit) (in shares) at Sep. 30, 2022 | 23,276,329 | ||||||
Beginning balance (deficit) at Mar. 31, 2022 | 235.2 | 269.3 | (2.3) | 39.1 | (70.6) | (0.3) | |
Beginning balance (deficit) (in shares) at Mar. 31, 2022 | 23,261,694 | ||||||
Net income | 16.3 | 15.4 | 0.9 | ||||
Foreign currency translation | (0.2) | (0.2) | |||||
Reclassification of de-designated interest rate collars | 0.1 | 0.1 | |||||
Issuance of stock grants | 0.4 | 0.4 | |||||
Issuance of stock grants (in shares) | 14,635 | ||||||
Non-cash stock-based compensation | 2.2 | 2.2 | |||||
Repurchases of common stock | (5.6) | (5.6) | |||||
Distributions to noncontrolling interests | (0.7) | (0.7) | |||||
Ending balance (deficit) at Jun. 30, 2022 | 247.7 | 271.9 | (2.4) | 54.5 | (76.2) | (0.1) | |
Ending balance (deficit) (in shares) at Jun. 30, 2022 | 23,276,329 | ||||||
Net income | 15.1 | 14.3 | 0.8 | ||||
Foreign currency translation | (0.6) | (0.6) | |||||
Non-cash stock-based compensation | 2.2 | 2.2 | |||||
Repurchases of common stock | (22) | (22) | |||||
Distributions to noncontrolling interests | (0.8) | (0.8) | |||||
Ending balance (deficit) at Sep. 30, 2022 | 241.6 | 274.1 | (3) | 68.8 | (98.2) | (0.1) | |
Ending balance (deficit) (in shares) at Sep. 30, 2022 | 23,276,329 | ||||||
Beginning balance (deficit) at Dec. 31, 2022 | $ 225.7 | 274.2 | (1.8) | 73.6 | (120) | (0.3) | |
Beginning balance (deficit) (in shares) at Dec. 31, 2022 | 19,767,287 | 23,276,329 | |||||
Net income | $ 9.3 | 8.4 | 0.9 | ||||
Foreign currency translation | 0.2 | 0.2 | |||||
Issuance of restricted stock units | (0.4) | (0.4) | |||||
Issuance of restricted stock units (in shares) | 148,806 | ||||||
Non-cash stock-based compensation | 2.2 | 2.2 | |||||
Noncontrolling interests buyout | (0.7) | (0.7) | |||||
Repurchases of common stock | (10.5) | (10.5) | |||||
Distributions to noncontrolling interests | (0.5) | (0.5) | |||||
Ending balance (deficit) at Mar. 31, 2023 | 225.3 | 275.3 | (1.6) | 82 | (130.5) | 0.1 | |
Ending balance (deficit) (in shares) at Mar. 31, 2023 | 23,425,135 | ||||||
Beginning balance (deficit) at Dec. 31, 2022 | $ 225.7 | 274.2 | (1.8) | 73.6 | (120) | (0.3) | |
Beginning balance (deficit) (in shares) at Dec. 31, 2022 | 19,767,287 | 23,276,329 | |||||
Net income | $ 32.7 | ||||||
Foreign currency translation | (0.2) | ||||||
Ending balance (deficit) at Sep. 30, 2023 | $ 252.1 | 281.1 | (2) | 103.5 | (130.5) | ||
Ending balance (deficit) (in shares) at Sep. 30, 2023 | 19,649,611 | 23,444,353 | |||||
Beginning balance (deficit) at Mar. 31, 2023 | $ 225.3 | 275.3 | (1.6) | 82 | (130.5) | 0.1 | |
Beginning balance (deficit) (in shares) at Mar. 31, 2023 | 23,425,135 | ||||||
Net income | 13.3 | 12.3 | 1 | ||||
Foreign currency translation | 0.5 | 0.5 | |||||
Issuance of stock grants | 0.6 | 0.6 | |||||
Issuance of stock grants (in shares) | 18,660 | ||||||
Issuance of restricted stock units (in shares) | 558 | ||||||
Non-cash stock-based compensation | 2.6 | 2.6 | |||||
Distributions to noncontrolling interests | (0.9) | (0.9) | |||||
Ending balance (deficit) at Jun. 30, 2023 | 241.4 | 278.5 | (1.1) | 94.3 | (130.5) | 0.2 | |
Ending balance (deficit) (in shares) at Jun. 30, 2023 | 23,444,353 | ||||||
Net income | 10.1 | 9.2 | 0.9 | ||||
Foreign currency translation | (0.9) | (0.9) | |||||
Non-cash stock-based compensation | 2.7 | 2.7 | |||||
Noncontrolling interests buyout | (0.1) | (0.1) | |||||
Distributions to noncontrolling interests | (1.1) | $ (1.1) | |||||
Ending balance (deficit) at Sep. 30, 2023 | $ 252.1 | $ 281.1 | $ (2) | $ 103.5 | $ (130.5) | ||
Ending balance (deficit) (in shares) at Sep. 30, 2023 | 19,649,611 | 23,444,353 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Operating activities | ||
Net income | $ 32.7 | $ 42.7 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 26.2 | 20.5 |
Non-cash stock-based compensation | 8.1 | 6.6 |
Provisions for credit losses on accounts receivable | 1.1 | 0 |
Deferred income taxes | 2.3 | 4.7 |
Other | (3) | 1.1 |
Changes in operating assets and liabilities | ||
Accounts receivable | (17.9) | (13.6) |
Prepaid expenses and other current assets | 3.6 | 17.8 |
Accounts payable | 9.1 | 10.2 |
Accrued liabilities and other | (8.7) | (14.4) |
Net cash provided by operating activities | 53.5 | 75.6 |
Investing activities | ||
Purchases of property and equipment | (17) | (16.5) |
Acquisition of business | (3.1) | |
Acquisition of other intangible assets | (1.8) | |
Proceeds from sale of equipment | 0.2 | |
Noncontrolling interest buyout | (2.3) | 0 |
Net cash used in investing activities | (22.4) | (18.1) |
Financing activities | ||
Proceeds from credit facility revolver | 345.5 | 336.4 |
Payments on credit facility revolver | (326.6) | (363.1) |
Proceeds from credit facility term loan | 17.2 | |
Payments on credit facility term loan | (3.7) | (5.5) |
Payments of debt issuance costs | (2.5) | |
Payments on other long-term borrowings | (5.7) | (7.7) |
Payments of withholding taxes on share-based compensation | (0.4) | 0 |
Distributions to noncontrolling interests | (2.5) | (2) |
Repurchases of common stock | (11.1) | (26.9) |
Net cash used in financing activities | (4.5) | (54.1) |
Effect of exchange rate changes on cash and cash equivalents | (0.5) | (0.7) |
Increase in cash and cash equivalents | 26.1 | 2.7 |
Cash and cash equivalents at beginning of year | 12.4 | 15.7 |
Cash and cash equivalents at end of period | 38.5 | 18.4 |
Cash paid (received) during the period for | ||
Interest | 20.7 | 11.6 |
Income taxes, net | $ 7.1 | $ (9.8) |
Significant Accounting Policies
Significant Accounting Policies and Practices | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies and Practices | 1. Significant Accounting Policies and Practices The Company SP Plus Corporation (the "Company") develops and integrates technology with operations management and support to deliver mobility solutions that enable the efficient and time-sensitive movement of people, vehicles and personal travel belongings. The Company is committed to providing solutions that make every moment matter for a world on the go while meeting the objectives of the Company's diverse client base in North America and Europe, which includes aviation, commercial, hospitality and institutional clients. The Company typically enters into contractual agreements with property owners or managers as opposed to owning facilities. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and disclosures normally included in the financial statements have been condensed or omitted as permitted by such rules and regulations. All adjustments (consisting only of adjustments of a normal and recurring nature) considered necessary for a fair presentation have been included. Operating results during the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for any other interim period or the fiscal year ending December 31, 2023. The financial statements presented in this report should be read in conjunction with the Company’s annual Consolidated Financial Statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2022 filed on February 24, 2023 with the Securities and Exchange Commission. Principles of Consolidation The unaudited Condensed Consolidated Financial Statements include the accounts of the Company, its wholly owned subsidiaries, and Variable Interest Entities ("VIEs") in which the Company is the primary beneficiary. The Company is the primary beneficiary of a VIE when the Company has the power to direct activities that most significantly affect the economic performance of the VIE. If the Company is not the primary beneficiary in a VIE and has significant influence, the Company accounts for the investment in the VIE as an equity method investment. As of September 30, 2023 and December 31, 2022, assets related to consolidated VIEs were $ 58.1 million and $ 57.1 million, respectively, which were primarily related to right-of-use (“ROU”) assets and property and equipment, net. As of September 30, 2023 and December 31, 2022, liabilities related to consolidated VIEs were $ 45.9 million and $ 50.9 million, respectively, which were primarily related to operating and finance lease liabilities. All intercompany profits, transactions and balances have been eliminated in consolidation. Cash and Cash Equivalents Cash equivalents represent funds temporarily invested in money market instruments with maturities of three months or less. Cash equivalents are stated at cost, which approximates fair value. Cash and cash equivalents that are restricted as to withdrawal or use under the terms of certain contractual agreements were $ 0.7 million and $ 0.6 million as of September 30, 2023 and December 31, 2022 , respectively, and were included in Cash and cash equivalents within the Condensed Consolidated Balance Sheets. Allowance for Doubtful Accounts Accounts receivable, net of the allowance for doubtful accounts, represents the Company’s estimate of the amount that ultimately will be realized in cash. The Company reviews the adequacy of its allowance for doubtful accounts on an ongoing basis, primarily using a review of specific accounts, as well as historical collection trends and aging of receivables, and records adjustments to the allowance as necessary. The Company’s allowance for doubtful accounts, which was included in Accounts receivable, net, within the Condensed Consolidated Balance Sheets, was $ 4.6 million and $ 4.0 million as of September 30, 2023 and December 31, 2022 , respectively. Property and Equipment, Net Property and equipment includes the Company's equipment, internal-use software, vehicles, leasehold improvements and construction/development in process. Property and equipment are stated at cost, less accumulated depreciation and amortization, whenever applicable. Certain costs incurred in the planning and evaluation stage of internal-use software projects are recorded to expense as incurred. Costs associated with directly obtaining, developing or upgrading internal-use software are capitalized and included as Software in Property and equipment, net, within the Condensed Consolidated Balance Sheets. When the internal-use software is ready for its intended use, it is amortized on a straight-line basis over the estimated useful life of the internal-use software, which is typically 3 years . Equipment and vehicles are depreciated on a straight-line basis over estimated useful lives ranging from 1 to 10 years . Expenditures for major renewals and improvements that extend the useful life of property and equipment, other than internal-use software, are capitalized. Leasehold improvements are amortized on a straight-line basis over the terms of the respective leases or the useful lives of the improvements, whichever is shorter. Equity Investments in Unconsolidated Entities The Company has ownership interests in 26 active partnerships, joint ventures or similar arrangements that operate parking facilities, of which 20 are consolidated under the VIE or voting interest models and 6 are unconsolidated where the Company’s ownership interests range from 30 - 50 percent and for which there are no indicators of control. The Company accounts for such investments under the equity method of accounting, and the Company’s underlying share of each investee’s equity of $ 12.1 million and $ 11.9 million as of September 30, 2023 and December 31, 2022, respectively, was included in Other noncurrent assets within the Condensed Consolidated Balance Sheets. As the operations of these entities are consistent with the Company’s underlying core business operations, the equity in earnings of these investments were included in Services revenue - lease type contracts within the Condensed Consolidated Statements of Income. The equity earnings in these related investments were $ 0.7 million and $ 2.5 million during the three months ended September 30, 2023 and 2022, respectively, and $ 2.0 million and $ 4.0 million during the nine months ended September 30, 2023 and 2022 , respectively. Other Noncurrent Assets Other noncurrent assets consisted of equity investments of unconsolidated entities, advances, deposits and cost of contracts, net, as of September 30, 2023 and December 31, 2022 . Accrued and Other Current Liabilities Accrued and other current liabilities consisted of insurance, accrued rent, compensation, contingent consideration, payroll withholdings, property, payroll and other taxes and other accrued expenses as of September 30, 2023 and December 31, 2022 . Noncontrolling Interests Noncontrolling interests represent the noncontrolling holders’ percentage share of income (losses) from the subsidiaries in which the Company holds a controlling, but less than 100 percent, ownership interest. The results of these subsidiaries are consolidated and included within the Condensed Consolidated Financial Statements. During the nine months ended September 30, 2023, the Company recorded a $ 1.0 million liability related to its estimate of additional consideration (“contingent consideration") due to a former minority partner that formerly held a noncontrolling interest in a joint venture with the Company. The Company purchased the minority partner’s interest in the joint venture in 2020. The contingent consideration is contingent on the performance of certain parking-related operations of the Bradley International Airport. The contingent consideration is not capped and, if any amount is due, would be payable to the former minority partner in April 2025. The $ 1.0 million was determined based on a probability weighting of potential payouts and recorded in Additional paid-in capital within the Condensed Consolidated Balance Sheets. In addition, the Company recorded a deferred tax asset of $ 0.3 million related to the contingent consideration during the nine months ended September 30, 2023, which was recorded in Additional paid-in capital within the Condensed Consolidated Balance Sheets. The Company will continue to evaluate the criteria for making these payments in the future and adjust the liability when deemed necessary. Additionally, during the nine months ended September 30, 2023, the Company paid a former minority partner $ 2.3 million per the terms of an agreement between the Company and the former minority partner. The Company purchased the former minority partner’s entire noncontrolling interest in a joint venture with the Company as of December 31, 2022. Per the terms of the agreement, the Company will be required to make additional payments to the former minority partner over a ten-year period, amounting to a total of $ 4.5 million. The $ 2.3 million that was paid during the nine months ended September 30, 2023 was included in Accrued and other current liabilities within the Condensed Consolidated Balance Sheets as of December 31, 2022. Goodwill Goodwill represents the excess of the purchase price paid over the fair value of net assets acquired. In accordance with the Financial Accounting Standards Board's ("FASB") authoritative accounting guidance on goodwill, the Company evaluates goodwill for impairment on an annual basis, or more often if events or circumstances change that could cause goodwill to become impaired. The Company has elected to assess the impairment of goodwill annually on October 1 or at an interim date if there is an event or change in circumstances indicating the carrying value may not be recoverable. The goodwill impairment test is performed at the reporting unit level; the Company's reporting units represent its operating segments, consisting of Commercial and Aviation. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the use of acquired assets or the Company’s business strategy, and significant negative industry or economic trends. The Company may perform a qualitative, rather than quantitative, assessment to determine whether it is more likely than not the fair value of a reporting unit is less than its carrying amount. If the Company determines it is more likely than not that the fair value is less than its carrying amount, the Company would need to perform a quantitative assessment. The determination of fair value of a reporting unit utilizes cash flow projections that assume certain future revenue and cost levels, comparable marketplace data, comparable company market valuations, assumed discount rates based upon current market conditions and other valuation factors, all of which involve the use of significant judgment and estimates. The Company also assesses critical areas that may impact its business, including economic conditions, market related exposures, competition, changes in service offerings and changes in key personnel. Other Intangible Assets, net Other intangible assets represent assets with finite lives that are amortized on a straight-line basis over their estimated useful lives. The Company evaluates other intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to their remaining useful lives. In addition, other intangible assets are reviewed for impairment when circumstances change that would indicate the carrying value may not be recoverable. Assumptions and estimates about future values and remaining useful lives of intangible assets are complex and subjective, and can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors, such as changes in the Company's business strategy and forecasts. Although the Company believes its historical assumptions and estimates are reasonable and appropriate, different assumptions and estimates could materially impact reported financial results. Long-Lived Assets The Company evaluates long-lived assets, including ROU assets, leasehold improvements, equipment and construction/development in progress, for impairment whenever events or circumstances indicate that the carrying value of an asset or asset group may not be recoverable. The Company groups assets at the lowest level for which cash flows are separately identified in order to measure an impairment. Events or circumstances that would result in an impairment review include a significant change in the use of an asset, the planned sale or disposal of an asset, or a projection that demonstrates continuing losses associated with the use of a long-lived asset or asset group. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset or asset group to future undiscounted cash flows expected to be generated by the asset or asset group. If the asset or asset group is determined to be impaired, the impairment recognized is measured by the amount by which the carrying value of the asset or asset group exceeds its fair value. Assumptions and estimates used to determine cash flows in the evaluation of impairment and the fair values used to determine the impairment are subject to a degree of judgment and complexity. Any future changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets or asset groups and could result in impairment charges. Future events that may result in impairment charges include economic volatility or other factors that could decrease revenues and profitability of existing locations and changes in the cost structure of existing facilities, such as increasing labor and benefit costs. Foreign Operations The Company has foreign operations in Canada, Puerto Rico, the United Kingdom and India. Assets and liabilities of the Company’s foreign operations are translated into U.S. dollars at the rate in effect on the respective balance sheet date, while income and expenses are translated at the average rates during the respective periods. Translation adjustments resulting from the fluctuations in exchange rates are recorded as a separate component of Accumulated other comprehensive loss in Stockholders’ equity within the Condensed Consolidated Balance Sheets, while transaction gains and losses are recorded within the Condensed Consolidated Statements of Income. Deferred income taxes are not recorded on cumulative foreign currency translation adjustments when the Company expects the foreign earnings to be permanently reinvested. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2023 | |
Business Combinations [Abstract] | |
Acquisitions | 2. Acquisitions 2023 Acquisition On July 25, 2023 , the Company acquired certain assets of Roker Inc. ("Roker"), a United States based provider of fully-integrated parking solutions that simplify permit, violation and enforcement management for organizations and municipalities, for approximately $ 3.1 million. The Company utilized borrowings under its Senior Credit Facility and cash on hand to fund the acquisition. Roker's operations are included in the Commercial segment. The acquisition enhances the Company's position as a global provider of frictionless technology solutions that is independent of the Company's legacy parking management related operations. The acquisition of Roker has been accounted for as a business combination, and the assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. Goodwill was measured as the excess of the consideration over the assets acquired, including other intangible assets, less liabilities assumed. Tax deductible goodwill related to the acquisition was $ 0.9 million. The results of the acquisition's operations are reflected in the Condensed Consolidated Financial Statements from the date of the acquisition. During the three and nine months ended September 30, 2023 , the acquisition of Roker contributed $ 0.1 million of service revenue and $ 0.1 million of losses before income taxes, primarily due to the amortization related to the acquired other intangible assets. The Company believes the information gathered to date provides a reasonable basis for estimating the fair values of the assets acquired and liabilities assumed, however, the provisional measurements of fair value for the other intangible assets and goodwill of Roker are subject to change. As a result, during the measurement period, which may be up to one year from the acquisition date, adjustments to the assets acquired and liabilities assumed may be recorded with corresponding adjustments to goodwill. The Company expects to complete the purchase price allocations for the Roker acquisition as soon as practicable but no later than one year from the acquisition date. The estimated fair values of the assets acquired and liabilities assumed based on the information that was available as of the acquisition date were as follows: (millions) Other intangible assets 2.3 Goodwill 0.9 Accounts payable ( 0.1 ) Net cash paid $ 3.1 As discussed above, during the nine months ended September 30, 2023 , the Company recorded additions to other intangible assets of $ 2.3 million. The other intangible assets acquired were recorded at their estimated fair value on the acquisition date as follows: (millions) Estimated Life Estimated Fair Value Proprietary know how 8.0 Years $ 2.1 Customer relationships 5.4 Years 0.2 Estimated fair value of identified intangible assets $ 2.3 The fair values of other intangible assets acquired were determined to be Level 3 under the fair value hierarchy. The fair value estimate for all identifiable intangible assets is based on assumptions that market participants would use in pricing an asset, based on the most advantageous market for the asset. The estimated fair value of the Proprietary know how was determined using the multi-period excess earnings method under the income approach utilizing projected financial information for the technology that was acquired. The estimated fair value of the customer relationships was determined using the distributor method under the income approach. 2022 Acquisitions On October 11, 2022 , the Company acquired K M P Associates Limited ("KMP"), a United Kingdom based software and technology provider serving aviation and commercial parking clients, primarily through its Aeroparker technology, throughout the United States and Europe, for approximately $ 13.8 million, less cash acquired of $ 0.9 million, and assumed KMP's debt of $ 0.3 million. Immediately following the acquisition, the Company repaid all of the debt assumed. KMP's operations are included in the Aviation segment. On November 10, 2022 , the Company acquired certain assets of DIVRT, Inc. ("DIVRT"), a developer of innovative software and technology solutions that enables frictionless parking capabilities, for approximately $ 17.6 million. In addition, the Company may be required to pay the former owner of DIVRT a maximum amount of $ 7.0 million in contingent consideration if certain targets related to the number of the Company's locations using the DIVRT technology are met by October 31, 2025. Based on a probability weighting of potential payouts, the Company accrued $ 4.0 million in projected contingent consideration as of the acquisition date, which was determined to be Level 3 under the fair value hierarchy. The Company's estimate of the potential payout increased to $ 4.4 million as of September 30, 2023 compared to $ 4.1 million as of December 31, 2022. The increases were due to the changes in the present value of the estimated payout. The Company recorded $ 0.1 million and $ 0.3 million of operating expense within the Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2023 , respectively, related to the change in the present value of the contingent consideration. As of September 30, 2023, the Company determined that the first target will be met by October 31, 2023, which is the second milestone date. As a result, the Company will pay the former owner of DIVRT $ 1.4 million during the fourth quarter of 2023. The Company will continue to evaluate the potential payouts in the future and adjust the contingent consideration for any changes in the estimated fair value each reporting period. DIVRT's operations are included in the Commercial segment. During the three and nine months ended September 30, 2023 , the acquisitions contributed $ 1.5 million and $ 4.7 million, respectively, of services revenue and losses before income taxes of $ 0.9 million and $ 2.6 million, respectively, primarily due to the amortization related to the acquired other intangible assets. The Company finalized its purchase price allocations for the KMP and DIVRT acquisitions during the nine months ended September 30, 2023 . The fair value of the assets acquired and liabilities assumed were as follows: (millions) Cash and cash equivalents $ 0.9 Accounts receivable 0.7 Prepaid expenses and other current assets 0.1 Other intangible assets 21.7 Goodwill 16.3 ROU asset 0.1 Accounts payable ( 0.1 ) Accrued and other current liabilities ( 1.5 ) Deferred income tax liability ( 2.5 ) Other long-term borrowings ( 0.3 ) Net assets acquired and liabilities assumed 35.4 Less: cash and cash equivalents acquired 0.9 Less: contingent consideration payable 4.0 Net cash paid $ 30.5 In addition to the acquisitions discussed above, on April 18, 2022, the Company acquired certain other intangible assets for a purchase price of $ 1.8 million. As discussed above, during the year ended December 31, 2022, the Company recorded additions to other intangible assets of $ 23.5 million. The other intangible assets acquired were recorded at their fair value on the acquisition dates as follows: (millions) Estimated Life Fair Value Proprietary know how 7.4 Years $ 17.3 Customer relationships 5.8 Years 3.2 Trade names 13.2 Years 1.8 Covenant not to compete 4.2 Years 1.2 Fair value of identified intangible assets $ 23.5 The fair values of other intangible assets acquired were determined to be Level 3 under the fair value hierarchy. The fair value for all identifiable intangible assets is based on assumptions that market participants would use in pricing an asset, based on the most advantageous market for the asset. The fair values of the Proprietary know how were determined using the multi-period excess earnings method under the income approach utilizing projected financial information for each technology that was acquired. The fair value of the customer relationships was determined using the distributor method under the income approach. The fair values of the trade names were determined using the relief from royalty savings method under the income approach. The Company considered the return on assets and market comparable methods when estimating an appropriate royalty rate for the trade names. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | 3. Leases The Company leases parking facilities, office space, warehouses, vehicles and equipment and determines if an arrangement is a lease at inception. The Company subleases certain real estate to third parties. The Company's sublease portfolio consists of operating leases for space within leased parking facilities. As discussed in Note 1. Significant Accounting Policies and Practices , the Company tests ROU assets for impairment when impairment indicators are present. The components of ROU assets and lease liabilities and the classification within the Condensed Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022 were as follows: (millions) Classification September 30, 2023 December 31, 2022 Assets Operating Right-of-use assets $ 173.7 $ 166.9 Finance Property and equipment, net 24.1 24.4 Total leased assets $ 197.8 $ 191.3 Liabilities Current Operating Short-term lease liabilities $ 56.4 $ 60.2 Finance Current portion of long-term borrowings 7.0 7.2 Noncurrent Operating Long-term lease liabilities 154.9 158.5 Finance Long-term borrowings, excluding current portion 16.0 16.0 Total lease liabilities $ 234.3 $ 241.9 The components of lease cost and classification within the Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) Classification September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease cost (a)(b) Cost of services - lease type contracts $ 15.7 $ 15.5 $ 44.7 $ 45.2 Short-term lease (a) Cost of services - lease type contracts 4.5 4.5 14.7 14.9 Variable lease Cost of services - lease type contracts 22.4 19.1 63.4 52.4 Operating lease cost 42.6 39.1 122.8 112.5 Finance lease cost Amortization of leased assets Depreciation and amortization 1.7 1.5 5.0 4.2 Interest on lease liabilities Interest expense 0.3 0.2 0.9 0.7 Net lease cost $ 44.6 $ 40.8 $ 128.7 $ 117.4 (a) Included expense related to leases for office space recorded in General and administrative expenses within the Condensed Consolidated Statements of Income of $ 1.0 million and $ 2.9 million during the three and nine months ended September 30, 2023 and 2022, respectively. (b) Included rent concessions of $ 0.8 million and $ 3.3 million during the three and nine months ended September 30, 2023 , respectively, and $ 1.3 million and $ 5.0 million during the three and nine months ended September 30, 2022 , respectively. Sublease income was $ 0.6 million and $ 0.4 million during the three months ended September 30, 2023 and 2022 , respectively, and $ 1.6 million and $ 1.0 million during the nine months ended September 30, 2023 and 2022, respectively. Maturities, lease term and discount rate information of lease liabilities as of September 30, 2023 (unaudited) were as follows: (millions) Operating Finance Total 2023 $ 18.1 $ 2.3 $ 20.4 2024 64.6 7.6 72.2 2025 52.1 5.6 57.7 2026 40.4 4.4 44.8 2027 26.4 2.5 28.9 After 2027 52.9 3.3 56.2 Total lease payments 254.5 25.7 280.2 Less: Imputed interest 43.2 2.7 45.9 Present value of lease liabilities $ 211.3 $ 23.0 $ 234.3 Weighted-average remaining lease term (years) 5.1 4.1 Weighted-average discount rate 5.4 % 5.4 % Future sublease income for the above periods shown was excluded, as the amounts are not material. Supplemental cash flow information related to leases during the nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Nine Months Ended (millions) September 30, 2023 September 30, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows related to operating leases $ 66.3 $ 69.0 Operating cash outflows related to interest on finance leases 0.9 0.7 Financing cash outflows related to finance leases 5.7 7.7 Leased assets obtained in exchange for new operating liabilities 49.3 12.4 Leased assets obtained in exchange for new finance lease liabilities 5.6 5.8 |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | 4. Revenue The Company recognizes revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. Contracts with customers and clients The Company accounts for a contract when it has the approval and commitment from both parties, the rights of the parties are identified, the payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Once a contract is identified, the Company evaluates whether the contract should be accounted for as more than one performance obligation. Substantially all of the Company’s revenues come from the following two types of arrangements: Lease type and Management type contracts. Management type contracts Management type contract revenue consists of management fees, including both fixed and performance-based fees, and in some cases e-commerce technology fees, customer convenience fees and monthly subscription fees related to the use of the Company's technology solutions. In exchange for this consideration, the Company may have a bundle of integrated services that comprise one performance obligation and include services such as managing the facility, as well as ancillary services such as accounting, equipment leasing, consulting, insurance and other value-added services. Management type contract revenues do not include gross customer collections at the managed facilities as these revenues belong to the property owners rather than the Company. Management type contracts generally provide the Company with management fees regardless of the operating performance of the underlying facilities. Revenue is recognized over time as the Company provides services. Lease type contracts Lease type contract revenue includes gross receipts (net of local taxes), consulting fees, e-commerce technology fees, customer convenience fees, gains on sales of contracts and payments for exercising termination rights. Performance obligations related to lease type contracts include parking for transient and monthly parkers. Revenue is recognized over time as the Company provides services. Under lease type arrangements, the Company pays the property owner a fixed base rent, percentage rent that is tied to the facility’s financial performance, or a combination of both. The Company operates the parking facility and is responsible for most operating expenses, but typically is not responsible for major maintenance, capital expenditures or real estate taxes. Certain expenses, primarily rental expense for the contractual arrangements that meet the definition of service concession arrangements, are recorded as a reduction of Service revenue – lease type contracts . Service concession arrangements Certain expenses (primarily rental expense), as well as depreciation and amortization, related to service concessions arrangements for lease type contracts, are recorded as a reduction of Service revenue – lease type contracts. The Company recorded cost concessions related to service concession arrangements (recognized as an increase to revenue) of $ 2.7 million and $ 8.3 million during the three and nine months ended September 30, 2023, respectively, and $ 3.1 million and $ 9.2 million during the three and nine months ended September 30, 2022, respectively. Disaggregation of revenue The Company disaggregates its revenue from contracts with customers by type of arrangement for each of the reportable segments. The Company has concluded that such disaggregation of revenue best depicts the overall economic nature, timing and uncertainty of the Company's revenue and cash flows affected by the economic factors of the respective contractual arrangement. See Note 13. Segment Information for further information on disaggregation of the Company's revenue by segment. Performance obligations As of September 30, 2023, the Company had $ 198.3 million related to performance obligations that were unsatisfied or partially unsatisfied for which the Company expects to recognize revenue. This amount excludes variable consideration primarily related to contracts where the Company and customer share the gross revenues or operating profit for the location and contracts where transaction prices include performance incentives that are constrained at contract inception. These performance incentives are based on measures that are ascertained exclusively by future performance and therefore cannot be estimated at contract inception by the Company. The Company applies the practical expedient that permits exclusion of information about the remaining performance obligations that have original expected durations of one year or less. The Company expects to recognize the remaining performance obligations as revenue in future periods as follows: (millions) (unaudited) Remaining 2023 $ 21.1 2024 64.2 2025 40.8 2026 31.6 2027 19.6 2028 and thereafter 21.0 Total $ 198.3 Contract balances Contract assets and liabilities are reported on a contract-by-contract basis and are included in Accounts receivable, net, and Accrued and other current liabilities, respectively, within the Condensed Consolidated Balance Sheets. The following table provides information about accounts receivable, contract assets and contract liabilities with customers and clients as of September 30, 2023 (unaudited) and December 31, 2022: (millions) September 30, 2023 December 31, 2022 Accounts receivable $ 189.0 $ 169.9 Contract asset — 1.8 Contract liabilities ( 15.3 ) ( 17.4 ) Changes in contract assets, which include the recognition of additional consideration due from the client, are offset by reclassifications of contract asset balances to accounts receivable when the Company obtains an unconditional right to consideration, thereby establishing an accounts receivable. The following table provides information about changes to contract assets during the nine months ended September 30, 2023 and 2022 (unaudited): Nine Months Ended (millions) September 30, 2023 September 30, 2022 Balance, beginning of period $ 1.8 $ 2.3 Additional contract assets — 0.2 Reclassification to accounts receivable ( 1.8 ) ( 2.3 ) Balance, end of period $ — $ 0.2 Changes in contract liabilities primarily include additional contract liabilities and reductions of contract liabilities when revenue is recognized. The following table provides information about changes to contract liabilities during the nine months ended September 30, 2023 and 2022 (unaudited): Nine Months Ended (millions) September 30, 2023 September 30, 2022 Balance, beginning of period $ ( 17.4 ) $ ( 15.7 ) Additional contract liabilities ( 15.3 ) ( 13.2 ) Recognition of revenue from contract liabilities 17.4 15.7 Balance, end of period $ ( 15.3 ) $ ( 13.2 ) Cost of contracts, net Cost of contracts expense related to service concession arrangements and certain management type contracts are recorded as a reduction of revenue. Cost of contracts expense during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included as a reduction to Services revenue – management type contracts within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Cost of contracts expense $ 0.2 $ 0.3 $ 0.7 $ 0.8 As of September 30, 2023 (unaudited) and December 31, 2022 , cost of contracts, net of accumulated amortization, included in Other noncurrent assets within the Condensed Consolidated Balance Sheets was $ 2.4 million and $ 2.9 million, respectively . |
Legal and Other Commitments and
Legal and Other Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal and Other Commitments and Contingencies | 5. Legal and Other Commitments and Contingencies The Company is subject to claims and litigation in the normal course of its business, including those related to labor and employment, contracts, personal injury and other related matters, some of which allege substantial monetary damages and claims. Some of these actions may be brought as class actions on behalf of a class or purported class of employees. While the outcomes of claims and legal proceedings brought against the Company are subject to uncertainty, the Company believes the final outcome will not have a material adverse effect on its financial position, results of operations or cash flows. |
Other Intangible Assets, net
Other Intangible Assets, net | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets, net | 6. Other Intangible Assets, net The components of other intangible assets, net, as of September 30, 2023 (unaudited) and December 31, 2022, were as follows: September 30, 2023 December 31, 2022 (millions) Weighted Intangible Accumulated Intangible Intangible Accumulated Intangible Management contract rights 5.8 $ 81.0 $ ( 56.7 ) $ 24.3 $ 81.0 $ ( 52.9 ) $ 28.1 Proprietary know how 6.5 23.8 ( 5.2 ) 18.6 21.7 ( 2.7 ) 19.0 Customer relationships 7.8 25.0 ( 8.3 ) 16.7 24.8 ( 6.6 ) 18.2 Trade names and trademarks 12.3 2.9 ( 1.1 ) 1.8 2.8 ( 0.7 ) 2.1 Covenant not to compete 3.5 2.9 ( 2.0 ) 0.9 2.9 ( 1.4 ) 1.5 Other intangible assets, net 6.7 $ 135.6 $ ( 73.3 ) $ 62.3 $ 133.2 $ ( 64.3 ) $ 68.9 Amortization expense related to other intangible assets during the three and nine months ended September 30, 2023 and 2022, (unaudited), respectively, which was included in Depreciation and amortization within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Amortization expense $ 3.0 $ 2.1 $ 9.0 $ 7.0 |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | 7. Goodwill The changes in the carrying amount of goodwill during the nine months ended September 30, 2023 (unaudited) were as follows: (millions) Commercial Aviation Total Net book value as of December 31, 2022 Goodwill $ 387.0 $ 215.7 $ 602.7 Accumulated impairment losses — ( 59.5 ) ( 59.5 ) Total $ 387.0 $ 156.2 $ 543.2 Acquisition 0.9 — 0.9 Foreign currency translation — 0.1 0.1 Net book value as of September 30, 2023 Goodwill $ 387.9 $ 215.8 $ 603.7 Accumulated impairment losses — ( 59.5 ) ( 59.5 ) Total $ 387.9 $ 156.3 $ 544.2 |
Borrowing Arrangements
Borrowing Arrangements | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Borrowing Arrangements | 8. Borrowing Arrangements Long-term borrowings, as of September 30, 2023 (unaudited) and December 31, 2022, in order of preference, were as follows: Amount Outstanding (millions) September 30, December 31, Senior Credit Facility, net of original discount on borrowings (1) $ 337.7 $ 322.3 Other borrowings (2) 24.1 24.3 Deferred financing costs ( 2.0 ) ( 2.4 ) Total obligations 359.8 344.2 Less: Current portion of long-term borrowings 14.7 12.4 Total long-term borrowings, excluding current portion $ 345.1 $ 331.8 (1) Included discount on borrowings of $ 1.1 million and $ 1.3 million as of September 30, 2023 and December 31, 2022, respectively. (2) Included finance lease liabilities of $ 23.0 million and $ 23.2 million as of September 30, 2023 and December 31, 2022, respectively. See Note 3. Leases for further discussion. Senior Credit Facility On April 21, 2022 (the “Fifth Amendment Effective Date”), the Company entered into a fifth amendment (the “Fifth Amendment”) to the Company’s credit agreement (as amended prior to the Fifth Amendment Effective Date, the “Credit Agreement”; the Credit Agreement, as amended by the Fifth Amendment, the “Amended Credit Agreement”) with Bank of America, N.A. (“Bank of America”), as Administrative Agent, swing-line lender and a letter of credit issuer; certain subsidiaries of the Company, as guarantors; and the lenders party thereto (the “Lenders”), pursuant to which the Lenders have made available to the Company a senior secured credit facility (the “Senior Credit Facility”). The Senior Credit Facility permits aggregate borrowings of $ 600.0 million consisting of (i) a revolving credit facility of up to $ 400.0 million at any time outstanding, which includes a letter of credit facility that is limited to $ 100.0 million at any time outstanding, and (ii) a term loan facility of $ 200.0 million. The maturity date of the Senior Credit Facility is April 21, 2027 . As of September 30, 2023 , the Company was in compliance with its debt covenants under the Amended Credit Agreement. As of September 30, 2023 , the Company had $ 39.1 million of letters of credit outstanding under the Senior Credit Facility and borrowings against the Senior Credit Facility aggregated to $ 338.8 million. The weighted average interest rate on the Senior Credit Facility was 6.7 % and 4.6 % during the nine months ended September 30, 2023 and 2022, respectively. That rate included the letters of credit for both years and interest rate collars during the nine months ended September 30, 2022 . The weighted average interest rate on all outstanding borrowings, not including letters of credit, was 7.2 % and 4.9 % during the nine months ended September 30, 2023 and 2022, respectively. Subordinated Convertible Debentures The Company acquired Subordinated Convertible Debentures ("Convertible Debentures") as a result of the October 2, 2012 acquisition of Central Parking Corporation. As of October 2, 2012, the Convertible Debentures were no longer redeemable for shares. The Convertible Debentures mature on April 1, 2028 at $ 25 per share. The Convertible Debenture holders have the right to redeem the Convertible Debentures for $ 19.18 per share upon acceleration or earlier repayment of the Convertible Debentures. There have been no redemptions of the Convertible Debentures during the periods ended September 30, 2023 and December 31, 2022. The approximate redemption value of the Convertible Debentures outstanding as of September 30, 2023 and December 31, 2022 was $ 1.1 million. |
Stock Repurchase Program
Stock Repurchase Program | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Stock Repurchase Program | 9. Stock Repurchase Program On February 14, 2023, the Company's Board of Directors (the "Board") authorized the Company to repurchase, on the open market, shares of the Company's outstanding common stock in an amount not to exceed $ 60.0 million. No shares have been repurchased under this program. In May 2022, the Board authorized the Company to repurchase, on the open market, shares of the Company’s outstanding common stock in an amount not to exceed $ 60.0 million in aggregate. During the nine months ended September 30, 2023 , 285,700 shares were repurchased at an average price of $ 36.53 per share under this program. As of September 30, 2023 , $ 0.2 million remained available for repurchase under this program. As a condition of the Merger Agreement (As defined in Note 14. Subsequent Events ), beginning on October 4, 2023, the Company is restricted from repurchasing its common stock. Stock repurchase activity under the May 2022 stock repurchase program during the three and nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Three Months Ended Nine Months Ended (millions, except for share and per share data) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Total number of shares repurchased — 667,300 285,700 843,800 Average price paid per share $ — $ 33.08 $ 36.53 $ 32.77 Total value of common stock repurchased $ — $ 22.0 $ 10.4 $ 27.6 The Company recorded $ 0.1 million in additional paid-in capital within the Condensed Consolidated Balance Sheets during the nine months ended September 30, 2023, related to the excise tax on net repurchases of common stock that was a provision of the Inflation Reduction Act of 2022. The remaining authorized repurchase amount under the May 2022 and February 2023 stock repurchase programs as of September 30, 2023 (unaudited), was as follows: (millions) September 30, 2023 Total authorized repurchase amount $ 120.0 Total value of shares repurchased 59.8 Total remaining authorized repurchase amount $ 60.2 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | 10. Stock-Based Compensation Stock Grants The Company granted 18,660 and 14,635 shares of common stock to the Board during the nine months ended September 30, 2023 and 2022, respectively. The Company recognized $ 0.6 million and $ 0.4 million of stock-based compensation expense related to stock grants during the nine months ended September 30, 2023 and 2022, respectively. Restricted Stock Units During the nine months ended September 30, 2023 , the Company granted 126,931 restricted stock units to certain executives that vest over three years . During the nine months ended September 30, 2022 , the Company granted 1,057 and 135,054 restricted stock units to certain executives and employees that vest over one and three years , respectively. Nonvested restricted stock units as of September 30, 2023, and changes during the nine months ended September 30, 2023 (unaudited) were as follows: Shares Weighted Average Grant-Date Fair Value Nonvested as of December 31, 2022 338,448 $ 33.28 Granted 126,931 34.57 Vested ( 8,426 ) 35.95 Nonvested as of September 30, 2023 456,953 $ 33.62 The Company's stock-based compensation expense related to the restricted stock units during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included in General and administrative expenses within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Stock-based compensation expense $ 1.3 $ 1.5 $ 3.8 $ 4.3 As of September 30, 2023 , there was $ 6.9 million of unrecognized stock-based compensation expense related to restricted stock units that are expected to be recognized over a weighted average remaining period of approximately 1.8 years. Performance Share Units (“PSUs”) During the nine months ended September 30, 2023 and 2022 , the Company granted 126,921 and 132,304 PSUs, respectively, to certain executives. The performance target is based on the achievement of a certain level of operating income, excluding depreciation and amortization, as well as certain other discretionary adjustments by the Board, over a three-year performance period. The ultimate number of shares issued could change depending on the Company’s results over the performance period. The maximum amount of shares that could be issued for the PSU's granted in 2023 ("2023 PSUs"), the PSU's granted in 2022 ("2022 PSUs") and the PSU's granted in 2021 ("2021 PSUs") are 253,842 , 258,114 and 97,096 , respectively. The Company is currently recognizing expense for the 2023 PSUs based on a payout of 134,536 shares, the 2022 PSUs based on a payout of 201,329 shares, and the maximum payout of 97,096 shares for the 2021 PSUs. Nonvested PSUs as of September 30, 2023, and changes during the nine months ended September 30, 2023 (unaudited), were as follows: Shares Weighted Average Grant-Date Fair Value Nonvested as of December 31, 2022 177,605 $ 31.94 Granted 126,921 34.57 Nonvested as of September 30, 2023 304,526 $ 33.04 The Company's stock-based compensation expense related to PSUs during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included in General and administrative expenses within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Stock-based compensation expense $ 1.4 $ 0.7 $ 3.7 $ 1.9 As of September 30, 2023 , there was $ 6.7 million of unrecognized stock-based compensation expenses related to PSUs that are expected to be recognized over a weighted average remaining period of approximately 1.8 years. In addition, the Company could recognize additional future stock-based compensation expenses of $ 4.1 million and $ 1.7 million for the 2023 PSUs and the 2022 PSUs, respectively, if the maximum performance target is achieved for each award. |
Net Income per Common Share
Net Income per Common Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Income per Common Share | 11. Net Income per Common Share Basic net income per common share is computed by dividing net income by the weighted daily average number of shares of common stock outstanding during the period. Diluted net income per common share is based upon the weighted daily average number of shares of common stock outstanding during the period plus all potentially dilutive stock-based awards, including restricted stock and performance share units, using the treasury-stock method. Unvested performance share units are excluded from the computation of weighted average diluted common shares outstanding if the performance targets upon which the issuance of the shares is contingent have not been achieved and the respective performance period has not been completed as of the end of the period. Basic and diluted net income per common share and a reconciliation of the weighted average basic common shares outstanding to the weighted average diluted common shares outstanding during the three and nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Three Months Ended Nine Months Ended (millions, except share and per share data) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Net income attributable to SP Plus Corporation $ 9.2 $ 14.3 $ 29.9 $ 40.4 Basic weighted average common shares outstanding 19,649,611 20,744,813 19,660,930 21,054,095 Dilutive impact of share-based awards 260,697 232,854 213,235 169,887 Diluted weighted average common shares outstanding 19,910,308 20,977,667 19,874,165 21,223,982 Net income per common share Basic $ 0.47 $ 0.69 $ 1.52 $ 1.92 Diluted $ 0.46 $ 0.68 $ 1.50 $ 1.90 There were no additional securities that could dilute basic earnings per share in the future that were not included in the computation of diluted earnings per common share, other than those disclosed. |
Comprehensive Loss
Comprehensive Loss | 9 Months Ended |
Sep. 30, 2023 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Comprehensive Loss | 12. Comprehe nsive Loss The components of other comprehensive loss and the income tax benefit allocated to each component during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) Before Tax Amount Income Tax Net of Tax Amount Before Tax Amount Income Tax Net of Tax Amount Translation adjustments $ ( 0.9 ) $ — $ ( 0.9 ) $ ( 0.2 ) $ — $ ( 0.2 ) Other comprehensive loss $ ( 0.9 ) $ — $ ( 0.9 ) $ ( 0.2 ) $ — $ ( 0.2 ) Three Months Ended Nine Months Ended (millions) Before Tax Amount Income Tax Net of Tax Amount Before Tax Amount Income Tax Net of Tax Amount Translation adjustments $ ( 0.6 ) $ — $ ( 0.6 ) $ ( 0.7 ) $ — $ ( 0.7 ) De-designation of interest rate collars — — — 0.7 0.2 0.5 Other comprehensive loss $ ( 0.6 ) $ — $ ( 0.6 ) $ — $ 0.2 $ ( 0.2 ) The changes to accumulated other comprehensive loss by component during the nine months ended September 30, 2023 (unaudited) were as follows: (millions) Foreign Total Accumulated Balance as of December 31, 2022 $ ( 1.8 ) $ ( 1.8 ) Other comprehensive loss before reclassification ( 0.2 ) ( 0.2 ) Balance as of September 30, 2023 $ ( 2.0 ) $ ( 2.0 ) The changes to accumulated other comprehensive loss by component during the nine months ended September 30, 2022 (unaudited) were as follows: (millions) Foreign Interest Rate Collars Total Accumulated Balance as of December 31, 2021 $ ( 2.3 ) $ ( 0.5 ) $ ( 2.8 ) Other comprehensive loss before reclassification ( 0.7 ) — ( 0.7 ) Amounts reclassified from accumulated other comprehensive loss — 0.5 0.5 Balance as of September 30, 2022 $ ( 3.0 ) $ — $ ( 3.0 ) Reclassifications from accumulated other comprehensive loss during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: (millions) Three Months Ended Nine Months Ended Classification in the Condensed Consolidated Statements of Income Interest Rate Collars: 2023 2022 2023 2022 Net realized loss $ — $ — $ — $ 0.7 Other expenses Reclassifications before tax — — — 0.7 Income tax benefit — — — 0.2 Reclassifications, net of tax $ — $ — $ — $ 0.5 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | 13. Segment Information Segment information is presented in accordance with a “management approach,” which designates the internal reporting used by the Company's Chief Operating Decision Maker (“CODM”) for making decisions and assessing performance as the source of the Company’s reportable segments. The Company’s segments are organized in a manner consistent with which discrete financial information is available and evaluated regularly by the CODM in deciding how to allocate resources and assess performance. An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenue and incur expenses, and about which separate financial information is regularly evaluated by the CODM. The CODM is the Company’s chief executive officer. Each of the operating segments are directly responsible for revenue and expenses related to their operations, including direct segment general and administrative expenses. The CODM assesses the performance of each operating segment using information about operating income (loss) as the primary measure of performance, but does not evaluate segments using discrete asset information. Therefore, assets are not presented at the segment level. There were no inter-segment transactions during the three and nine months ended September 30, 2023, and the Company does not allocate other expense (income), interest expense (income) or income tax expense (benefit) to the operating segments. The accounting policies for segment reporting are the same as for the Company as a whole. The Company’s operating segments are Commercial and Aviation: • Commercial encompasses the Company's services in healthcare facilities, municipalities, including meter revenue collection and enforcement services, government facilities, hotels, commercial real estate, residential communities, retail, colleges and universities, as well as ancillary services such as providing technology-based mobility solutions, shuttle and ground transportation services, valet services, taxi and livery dispatch services and event planning, including shuttle and transportation services. • Aviation encompasses the Company's services in aviation (i.e., airports, airline and certain hospitality clients with baggage and parking services) as well as ancillary services, which include shuttle and ground transportation services, valet services, baggage handling, baggage repair and replacement, remote air check-in services, wheelchair assist services and other services, as well as providing technology-based mobility solutions. The Other segment includes costs related to the Company’s operational support teams and costs related to common and shared infrastructure, including finance, accounting, information technology, human resources, procurement, legal and corporate development. Revenue, operating income (loss), general and administrative expenses and depreciation and amortization by operating segment during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Services revenue Commercial Management type contracts $ 75.6 $ 68.2 $ 230.6 $ 206.0 Lease type contracts 70.9 68.6 207.9 194.9 Total Commercial 146.5 136.8 438.5 400.9 Aviation Management type contracts 77.9 66.7 216.0 176.6 Lease type contracts 4.0 3.6 11.5 10.5 Total Aviation 81.9 70.3 227.5 187.1 Reimbursed management type contract revenue 232.3 197.3 662.2 547.2 Total services revenue $ 460.7 $ 404.4 $ 1,328.2 $ 1,135.2 Operating income (loss) Commercial $ 35.7 $ 32.4 $ 103.0 $ 95.7 Aviation 10.6 9.7 28.8 26.3 Other ( 25.3 ) ( 18.3 ) ( 66.2 ) ( 52.5 ) Total operating income $ 21.0 $ 23.8 $ 65.6 $ 69.5 General and administrative expenses Commercial $ 9.8 $ 7.2 $ 27.3 $ 21.1 Aviation 4.8 3.1 12.7 8.7 Other 23.0 16.9 60.0 48.6 Total general and administrative expenses $ 37.6 $ 27.2 $ 100.0 $ 78.4 Depreciation and amortization Commercial (1) $ 3.8 $ 3.4 $ 11.2 $ 9.2 Aviation (2) 2.9 2.4 8.8 7.4 Other 2.3 1.4 6.2 3.9 Total depreciation and amortization $ 9.0 $ 7.2 $ 26.2 $ 20.5 (1) Included depreciation and amortization expenses related to cost of services activities of $ 2.0 million and $ 2.1 million during the three months ended September 30, 2023 and 2022 , respectively, and $ 6.1 million and $ 5.5 million during the nine months ended September 30, 2023 and 2022, respectively. (2) Included depreciation and amortization expenses related to cost of service activities of $ 1.4 million and $ 1.3 million during the three months ended September 30, 2023 and 2022 , respectively, and $ 4.2 million and $ 3.5 million during the nine months ended September 30, 2023 and 2022 , respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 14. Subsequent Event On October 4, 2023, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") by and among the Company, Metropolis Technologies, Inc. ("Metropolis"), and Schwinger Merger Sub Inc., a direct, wholly owned subsidiary of Metropolis (“Merger Sub”), in an all-cash transaction with a total enterprise value of approximately $ 1.5 billion. Pursuant to the Merger Agreement, subject to the terms and conditions therein, Merger Sub will acquire all of the outstanding shares of the Company's common stock for $ 54.00 per share, without interest, and merge with the Company, with the Company surviving as a wholly owned subsidiary of Metropolis. The transaction is expected to close in 2024, subject to customary closing conditions, including approval by the Company's stockholders and the receipt of regulatory approvals. Upon completion of the transaction, the Company's shares will no longer trade on The Nasdaq Global Select Market. The Company has made customary representations, warranties and covenants in the Merger Agreement. Subject to certain exceptions outlined in the Merger Agreement, the Company has agreed to certain covenants relating to the Company's business during the period between the execution of the Merger Agreement and the consummation of the transaction, including restrictions on its ability to issue any shares of its capital stock, repurchase any shares of its common stock, incur additional indebtedness and engage in certain merger and acquisition transactions. As of September 30, 2023, the Company has incurred $ 3.5 million in expenses related to the proposed merger, which the Company expects to pay in the fourth quarter of 2023. |
Significant Accounting Polici_2
Significant Accounting Policies and Practices (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and disclosures normally included in the financial statements have been condensed or omitted as permitted by such rules and regulations. All adjustments (consisting only of adjustments of a normal and recurring nature) considered necessary for a fair presentation have been included. Operating results during the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for any other interim period or the fiscal year ending December 31, 2023. The financial statements presented in this report should be read in conjunction with the Company’s annual Consolidated Financial Statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2022 filed on February 24, 2023 with the Securities and Exchange Commission. |
Principles of Consolidation | Principles of Consolidation The unaudited Condensed Consolidated Financial Statements include the accounts of the Company, its wholly owned subsidiaries, and Variable Interest Entities ("VIEs") in which the Company is the primary beneficiary. The Company is the primary beneficiary of a VIE when the Company has the power to direct activities that most significantly affect the economic performance of the VIE. If the Company is not the primary beneficiary in a VIE and has significant influence, the Company accounts for the investment in the VIE as an equity method investment. As of September 30, 2023 and December 31, 2022, assets related to consolidated VIEs were $ 58.1 million and $ 57.1 million, respectively, which were primarily related to right-of-use (“ROU”) assets and property and equipment, net. As of September 30, 2023 and December 31, 2022, liabilities related to consolidated VIEs were $ 45.9 million and $ 50.9 million, respectively, which were primarily related to operating and finance lease liabilities. All intercompany profits, transactions and balances have been eliminated in consolidation. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents represent funds temporarily invested in money market instruments with maturities of three months or less. Cash equivalents are stated at cost, which approximates fair value. Cash and cash equivalents that are restricted as to withdrawal or use under the terms of certain contractual agreements were $ 0.7 million and $ 0.6 million as of September 30, 2023 and December 31, 2022 , respectively, and were included in Cash and cash equivalents within the Condensed Consolidated Balance Sheets. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts Accounts receivable, net of the allowance for doubtful accounts, represents the Company’s estimate of the amount that ultimately will be realized in cash. The Company reviews the adequacy of its allowance for doubtful accounts on an ongoing basis, primarily using a review of specific accounts, as well as historical collection trends and aging of receivables, and records adjustments to the allowance as necessary. The Company’s allowance for doubtful accounts, which was included in Accounts receivable, net, within the Condensed Consolidated Balance Sheets, was $ 4.6 million and $ 4.0 million as of September 30, 2023 and December 31, 2022 , respectively. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment includes the Company's equipment, internal-use software, vehicles, leasehold improvements and construction/development in process. Property and equipment are stated at cost, less accumulated depreciation and amortization, whenever applicable. Certain costs incurred in the planning and evaluation stage of internal-use software projects are recorded to expense as incurred. Costs associated with directly obtaining, developing or upgrading internal-use software are capitalized and included as Software in Property and equipment, net, within the Condensed Consolidated Balance Sheets. When the internal-use software is ready for its intended use, it is amortized on a straight-line basis over the estimated useful life of the internal-use software, which is typically 3 years . Equipment and vehicles are depreciated on a straight-line basis over estimated useful lives ranging from 1 to 10 years . Expenditures for major renewals and improvements that extend the useful life of property and equipment, other than internal-use software, are capitalized. Leasehold improvements are amortized on a straight-line basis over the terms of the respective leases or the useful lives of the improvements, whichever is shorter. |
Equity Investments in Unconsolidated Entities | Equity Investments in Unconsolidated Entities The Company has ownership interests in 26 active partnerships, joint ventures or similar arrangements that operate parking facilities, of which 20 are consolidated under the VIE or voting interest models and 6 are unconsolidated where the Company’s ownership interests range from 30 - 50 percent and for which there are no indicators of control. The Company accounts for such investments under the equity method of accounting, and the Company’s underlying share of each investee’s equity of $ 12.1 million and $ 11.9 million as of September 30, 2023 and December 31, 2022, respectively, was included in Other noncurrent assets within the Condensed Consolidated Balance Sheets. As the operations of these entities are consistent with the Company’s underlying core business operations, the equity in earnings of these investments were included in Services revenue - lease type contracts within the Condensed Consolidated Statements of Income. The equity earnings in these related investments were $ 0.7 million and $ 2.5 million during the three months ended September 30, 2023 and 2022, respectively, and $ 2.0 million and $ 4.0 million during the nine months ended September 30, 2023 and 2022 , respectively. |
Other Noncurrent Assets | Other Noncurrent Assets Other noncurrent assets consisted of equity investments of unconsolidated entities, advances, deposits and cost of contracts, net, as of September 30, 2023 and December 31, 2022 . |
Accrued and Other Current Liabilities | Accrued and Other Current Liabilities Accrued and other current liabilities consisted of insurance, accrued rent, compensation, contingent consideration, payroll withholdings, property, payroll and other taxes and other accrued expenses as of September 30, 2023 and December 31, 2022 . |
Noncontrolling Interests | Noncontrolling Interests Noncontrolling interests represent the noncontrolling holders’ percentage share of income (losses) from the subsidiaries in which the Company holds a controlling, but less than 100 percent, ownership interest. The results of these subsidiaries are consolidated and included within the Condensed Consolidated Financial Statements. During the nine months ended September 30, 2023, the Company recorded a $ 1.0 million liability related to its estimate of additional consideration (“contingent consideration") due to a former minority partner that formerly held a noncontrolling interest in a joint venture with the Company. The Company purchased the minority partner’s interest in the joint venture in 2020. The contingent consideration is contingent on the performance of certain parking-related operations of the Bradley International Airport. The contingent consideration is not capped and, if any amount is due, would be payable to the former minority partner in April 2025. The $ 1.0 million was determined based on a probability weighting of potential payouts and recorded in Additional paid-in capital within the Condensed Consolidated Balance Sheets. In addition, the Company recorded a deferred tax asset of $ 0.3 million related to the contingent consideration during the nine months ended September 30, 2023, which was recorded in Additional paid-in capital within the Condensed Consolidated Balance Sheets. The Company will continue to evaluate the criteria for making these payments in the future and adjust the liability when deemed necessary. Additionally, during the nine months ended September 30, 2023, the Company paid a former minority partner $ 2.3 million per the terms of an agreement between the Company and the former minority partner. The Company purchased the former minority partner’s entire noncontrolling interest in a joint venture with the Company as of December 31, 2022. Per the terms of the agreement, the Company will be required to make additional payments to the former minority partner over a ten-year period, amounting to a total of $ 4.5 million. The $ 2.3 million that was paid during the nine months ended September 30, 2023 was included in Accrued and other current liabilities within the Condensed Consolidated Balance Sheets as of December 31, 2022. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price paid over the fair value of net assets acquired. In accordance with the Financial Accounting Standards Board's ("FASB") authoritative accounting guidance on goodwill, the Company evaluates goodwill for impairment on an annual basis, or more often if events or circumstances change that could cause goodwill to become impaired. The Company has elected to assess the impairment of goodwill annually on October 1 or at an interim date if there is an event or change in circumstances indicating the carrying value may not be recoverable. The goodwill impairment test is performed at the reporting unit level; the Company's reporting units represent its operating segments, consisting of Commercial and Aviation. Factors that could trigger an impairment review include significant under-performance relative to expected historical or projected future operating results, significant changes in the use of acquired assets or the Company’s business strategy, and significant negative industry or economic trends. The Company may perform a qualitative, rather than quantitative, assessment to determine whether it is more likely than not the fair value of a reporting unit is less than its carrying amount. If the Company determines it is more likely than not that the fair value is less than its carrying amount, the Company would need to perform a quantitative assessment. The determination of fair value of a reporting unit utilizes cash flow projections that assume certain future revenue and cost levels, comparable marketplace data, comparable company market valuations, assumed discount rates based upon current market conditions and other valuation factors, all of which involve the use of significant judgment and estimates. The Company also assesses critical areas that may impact its business, including economic conditions, market related exposures, competition, changes in service offerings and changes in key personnel. |
Other Intangible Assets, Net | Other Intangible Assets, net Other intangible assets represent assets with finite lives that are amortized on a straight-line basis over their estimated useful lives. The Company evaluates other intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to their remaining useful lives. In addition, other intangible assets are reviewed for impairment when circumstances change that would indicate the carrying value may not be recoverable. Assumptions and estimates about future values and remaining useful lives of intangible assets are complex and subjective, and can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors, such as changes in the Company's business strategy and forecasts. Although the Company believes its historical assumptions and estimates are reasonable and appropriate, different assumptions and estimates could materially impact reported financial results. |
Long-Lived Assets | Long-Lived Assets The Company evaluates long-lived assets, including ROU assets, leasehold improvements, equipment and construction/development in progress, for impairment whenever events or circumstances indicate that the carrying value of an asset or asset group may not be recoverable. The Company groups assets at the lowest level for which cash flows are separately identified in order to measure an impairment. Events or circumstances that would result in an impairment review include a significant change in the use of an asset, the planned sale or disposal of an asset, or a projection that demonstrates continuing losses associated with the use of a long-lived asset or asset group. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the asset or asset group to future undiscounted cash flows expected to be generated by the asset or asset group. If the asset or asset group is determined to be impaired, the impairment recognized is measured by the amount by which the carrying value of the asset or asset group exceeds its fair value. Assumptions and estimates used to determine cash flows in the evaluation of impairment and the fair values used to determine the impairment are subject to a degree of judgment and complexity. Any future changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets or asset groups and could result in impairment charges. Future events that may result in impairment charges include economic volatility or other factors that could decrease revenues and profitability of existing locations and changes in the cost structure of existing facilities, such as increasing labor and benefit costs. |
Foreign Operations | Foreign Operations The Company has foreign operations in Canada, Puerto Rico, the United Kingdom and India. Assets and liabilities of the Company’s foreign operations are translated into U.S. dollars at the rate in effect on the respective balance sheet date, while income and expenses are translated at the average rates during the respective periods. Translation adjustments resulting from the fluctuations in exchange rates are recorded as a separate component of Accumulated other comprehensive loss in Stockholders’ equity within the Condensed Consolidated Balance Sheets, while transaction gains and losses are recorded within the Condensed Consolidated Statements of Income. Deferred income taxes are not recorded on cumulative foreign currency translation adjustments when the Company expects the foreign earnings to be permanently reinvested. |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Roker Inc. (Roker) | |
Business Acquisition [Line Items] | |
Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The estimated fair values of the assets acquired and liabilities assumed based on the information that was available as of the acquisition date were as follows: (millions) Other intangible assets 2.3 Goodwill 0.9 Accounts payable ( 0.1 ) Net cash paid $ 3.1 |
Schedule of Other Assets Acquired were Recorded at their Estimated Fair Value | The other intangible assets acquired were recorded at their estimated fair value on the acquisition date as follows: (millions) Estimated Life Estimated Fair Value Proprietary know how 8.0 Years $ 2.1 Customer relationships 5.4 Years 0.2 Estimated fair value of identified intangible assets $ 2.3 |
KMP Associates Limited and Divrt, Inc. | |
Business Acquisition [Line Items] | |
Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed | The fair value of the assets acquired and liabilities assumed were as follows: (millions) Cash and cash equivalents $ 0.9 Accounts receivable 0.7 Prepaid expenses and other current assets 0.1 Other intangible assets 21.7 Goodwill 16.3 ROU asset 0.1 Accounts payable ( 0.1 ) Accrued and other current liabilities ( 1.5 ) Deferred income tax liability ( 2.5 ) Other long-term borrowings ( 0.3 ) Net assets acquired and liabilities assumed 35.4 Less: cash and cash equivalents acquired 0.9 Less: contingent consideration payable 4.0 Net cash paid $ 30.5 |
Schedule of Other Assets Acquired were Recorded at their Estimated Fair Value | The other intangible assets acquired were recorded at their fair value on the acquisition dates as follows: (millions) Estimated Life Fair Value Proprietary know how 7.4 Years $ 17.3 Customer relationships 5.8 Years 3.2 Trade names 13.2 Years 1.8 Covenant not to compete 4.2 Years 1.2 Fair value of identified intangible assets $ 23.5 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Components of ROU Assets and Lease Liabilities | The components of ROU assets and lease liabilities and the classification within the Condensed Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022 were as follows: (millions) Classification September 30, 2023 December 31, 2022 Assets Operating Right-of-use assets $ 173.7 $ 166.9 Finance Property and equipment, net 24.1 24.4 Total leased assets $ 197.8 $ 191.3 Liabilities Current Operating Short-term lease liabilities $ 56.4 $ 60.2 Finance Current portion of long-term borrowings 7.0 7.2 Noncurrent Operating Long-term lease liabilities 154.9 158.5 Finance Long-term borrowings, excluding current portion 16.0 16.0 Total lease liabilities $ 234.3 $ 241.9 |
Schedule of Components of Lease Cost | The components of lease cost and classification within the Condensed Consolidated Statements of Income during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) Classification September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Operating lease cost (a)(b) Cost of services - lease type contracts $ 15.7 $ 15.5 $ 44.7 $ 45.2 Short-term lease (a) Cost of services - lease type contracts 4.5 4.5 14.7 14.9 Variable lease Cost of services - lease type contracts 22.4 19.1 63.4 52.4 Operating lease cost 42.6 39.1 122.8 112.5 Finance lease cost Amortization of leased assets Depreciation and amortization 1.7 1.5 5.0 4.2 Interest on lease liabilities Interest expense 0.3 0.2 0.9 0.7 Net lease cost $ 44.6 $ 40.8 $ 128.7 $ 117.4 (a) Included expense related to leases for office space recorded in General and administrative expenses within the Condensed Consolidated Statements of Income of $ 1.0 million and $ 2.9 million during the three and nine months ended September 30, 2023 and 2022, respectively. (b) Included rent concessions of $ 0.8 million and $ 3.3 million during the three and nine months ended September 30, 2023 , respectively, and $ 1.3 million and $ 5.0 million during the three and nine months ended September 30, 2022 , respectively. |
Schedule of Maturities of Lease Liabilities | Maturities, lease term and discount rate information of lease liabilities as of September 30, 2023 (unaudited) were as follows: (millions) Operating Finance Total 2023 $ 18.1 $ 2.3 $ 20.4 2024 64.6 7.6 72.2 2025 52.1 5.6 57.7 2026 40.4 4.4 44.8 2027 26.4 2.5 28.9 After 2027 52.9 3.3 56.2 Total lease payments 254.5 25.7 280.2 Less: Imputed interest 43.2 2.7 45.9 Present value of lease liabilities $ 211.3 $ 23.0 $ 234.3 Weighted-average remaining lease term (years) 5.1 4.1 Weighted-average discount rate 5.4 % 5.4 % |
Schedule of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases during the nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Nine Months Ended (millions) September 30, 2023 September 30, 2022 Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows related to operating leases $ 66.3 $ 69.0 Operating cash outflows related to interest on finance leases 0.9 0.7 Financing cash outflows related to finance leases 5.7 7.7 Leased assets obtained in exchange for new operating liabilities 49.3 12.4 Leased assets obtained in exchange for new finance lease liabilities 5.6 5.8 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Remaining Performance Obligations | The Company expects to recognize the remaining performance obligations as revenue in future periods as follows: (millions) (unaudited) Remaining 2023 $ 21.1 2024 64.2 2025 40.8 2026 31.6 2027 19.6 2028 and thereafter 21.0 Total $ 198.3 |
Schedule of Contract with Customer, Asset and Liabilities | The following table provides information about accounts receivable, contract assets and contract liabilities with customers and clients as of September 30, 2023 (unaudited) and December 31, 2022: (millions) September 30, 2023 December 31, 2022 Accounts receivable $ 189.0 $ 169.9 Contract asset — 1.8 Contract liabilities ( 15.3 ) ( 17.4 ) Changes in contract assets, which include the recognition of additional consideration due from the client, are offset by reclassifications of contract asset balances to accounts receivable when the Company obtains an unconditional right to consideration, thereby establishing an accounts receivable. The following table provides information about changes to contract assets during the nine months ended September 30, 2023 and 2022 (unaudited): Nine Months Ended (millions) September 30, 2023 September 30, 2022 Balance, beginning of period $ 1.8 $ 2.3 Additional contract assets — 0.2 Reclassification to accounts receivable ( 1.8 ) ( 2.3 ) Balance, end of period $ — $ 0.2 Changes in contract liabilities primarily include additional contract liabilities and reductions of contract liabilities when revenue is recognized. The following table provides information about changes to contract liabilities during the nine months ended September 30, 2023 and 2022 (unaudited): Nine Months Ended (millions) September 30, 2023 September 30, 2022 Balance, beginning of period $ ( 17.4 ) $ ( 15.7 ) Additional contract liabilities ( 15.3 ) ( 13.2 ) Recognition of revenue from contract liabilities 17.4 15.7 Balance, end of period $ ( 15.3 ) $ ( 13.2 ) |
Schedule of Cost of Contracts Expense | Cost of contracts expense related to service concession arrangements and certain management type contracts are recorded as a reduction of revenue. Cost of contracts expense during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included as a reduction to Services revenue – management type contracts within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Cost of contracts expense $ 0.2 $ 0.3 $ 0.7 $ 0.8 |
Other Intangible Assets, net (T
Other Intangible Assets, net (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Components of Intangible Assets, Net | The components of other intangible assets, net, as of September 30, 2023 (unaudited) and December 31, 2022, were as follows: September 30, 2023 December 31, 2022 (millions) Weighted Intangible Accumulated Intangible Intangible Accumulated Intangible Management contract rights 5.8 $ 81.0 $ ( 56.7 ) $ 24.3 $ 81.0 $ ( 52.9 ) $ 28.1 Proprietary know how 6.5 23.8 ( 5.2 ) 18.6 21.7 ( 2.7 ) 19.0 Customer relationships 7.8 25.0 ( 8.3 ) 16.7 24.8 ( 6.6 ) 18.2 Trade names and trademarks 12.3 2.9 ( 1.1 ) 1.8 2.8 ( 0.7 ) 2.1 Covenant not to compete 3.5 2.9 ( 2.0 ) 0.9 2.9 ( 1.4 ) 1.5 Other intangible assets, net 6.7 $ 135.6 $ ( 73.3 ) $ 62.3 $ 133.2 $ ( 64.3 ) $ 68.9 |
Summary of Amortization of Other Intangible Assets | Amortization expense related to other intangible assets during the three and nine months ended September 30, 2023 and 2022, (unaudited), respectively, which was included in Depreciation and amortization within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Amortization expense $ 3.0 $ 2.1 $ 9.0 $ 7.0 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amounts of Goodwill | The changes in the carrying amount of goodwill during the nine months ended September 30, 2023 (unaudited) were as follows: (millions) Commercial Aviation Total Net book value as of December 31, 2022 Goodwill $ 387.0 $ 215.7 $ 602.7 Accumulated impairment losses — ( 59.5 ) ( 59.5 ) Total $ 387.0 $ 156.2 $ 543.2 Acquisition 0.9 — 0.9 Foreign currency translation — 0.1 0.1 Net book value as of September 30, 2023 Goodwill $ 387.9 $ 215.8 $ 603.7 Accumulated impairment losses — ( 59.5 ) ( 59.5 ) Total $ 387.9 $ 156.3 $ 544.2 |
Borrowing Arrangements (Tables)
Borrowing Arrangements (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Borrowings | Long-term borrowings, as of September 30, 2023 (unaudited) and December 31, 2022, in order of preference, were as follows: Amount Outstanding (millions) September 30, December 31, Senior Credit Facility, net of original discount on borrowings (1) $ 337.7 $ 322.3 Other borrowings (2) 24.1 24.3 Deferred financing costs ( 2.0 ) ( 2.4 ) Total obligations 359.8 344.2 Less: Current portion of long-term borrowings 14.7 12.4 Total long-term borrowings, excluding current portion $ 345.1 $ 331.8 (1) Included discount on borrowings of $ 1.1 million and $ 1.3 million as of September 30, 2023 and December 31, 2022, respectively. (2) Included finance lease liabilities of $ 23.0 million and $ 23.2 million as of September 30, 2023 and December 31, 2022, respectively. See Note 3. Leases for further discussion. |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Summary of Share Repurchase Activity and Remaining Authorized Repurchase Amounts | Stock repurchase activity under the May 2022 stock repurchase program during the three and nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Three Months Ended Nine Months Ended (millions, except for share and per share data) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Total number of shares repurchased — 667,300 285,700 843,800 Average price paid per share $ — $ 33.08 $ 36.53 $ 32.77 Total value of common stock repurchased $ — $ 22.0 $ 10.4 $ 27.6 The remaining authorized repurchase amount under the May 2022 and February 2023 stock repurchase programs as of September 30, 2023 (unaudited), was as follows: (millions) September 30, 2023 Total authorized repurchase amount $ 120.0 Total value of shares repurchased 59.8 Total remaining authorized repurchase amount $ 60.2 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Nonvested Restricted Stock Units and Changes During the Period | Nonvested restricted stock units as of September 30, 2023, and changes during the nine months ended September 30, 2023 (unaudited) were as follows: Shares Weighted Average Grant-Date Fair Value Nonvested as of December 31, 2022 338,448 $ 33.28 Granted 126,931 34.57 Vested ( 8,426 ) 35.95 Nonvested as of September 30, 2023 456,953 $ 33.62 |
Schedule of Stock-Based Compensation Expense | The Company's stock-based compensation expense related to the restricted stock units during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included in General and administrative expenses within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Stock-based compensation expense $ 1.3 $ 1.5 $ 3.8 $ 4.3 The Company's stock-based compensation expense related to PSUs during the three and nine months ended September 30, 2023 and 2022 (unaudited), which was included in General and administrative expenses within the Condensed Consolidated Statements of Income, was as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Stock-based compensation expense $ 1.4 $ 0.7 $ 3.7 $ 1.9 |
Summary of Nonvested PSU's and Changes During the Period | Nonvested PSUs as of September 30, 2023, and changes during the nine months ended September 30, 2023 (unaudited), were as follows: Shares Weighted Average Grant-Date Fair Value Nonvested as of December 31, 2022 177,605 $ 31.94 Granted 126,921 34.57 Nonvested as of September 30, 2023 304,526 $ 33.04 |
Net Income per Common Share (Ta
Net Income per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income per Common Share and Reconciliation of Weighted Average Shares | Basic and diluted net income per common share and a reconciliation of the weighted average basic common shares outstanding to the weighted average diluted common shares outstanding during the three and nine months ended September 30, 2023 and 2022 (unaudited) was as follows: Three Months Ended Nine Months Ended (millions, except share and per share data) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Net income attributable to SP Plus Corporation $ 9.2 $ 14.3 $ 29.9 $ 40.4 Basic weighted average common shares outstanding 19,649,611 20,744,813 19,660,930 21,054,095 Dilutive impact of share-based awards 260,697 232,854 213,235 169,887 Diluted weighted average common shares outstanding 19,910,308 20,977,667 19,874,165 21,223,982 Net income per common share Basic $ 0.47 $ 0.69 $ 1.52 $ 1.92 Diluted $ 0.46 $ 0.68 $ 1.50 $ 1.90 |
Comprehensive Loss (Tables)
Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Components of Other Comprehensive Loss and Income Tax Benefit Allocated | The components of other comprehensive loss and the income tax benefit allocated to each component during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) Before Tax Amount Income Tax Net of Tax Amount Before Tax Amount Income Tax Net of Tax Amount Translation adjustments $ ( 0.9 ) $ — $ ( 0.9 ) $ ( 0.2 ) $ — $ ( 0.2 ) Other comprehensive loss $ ( 0.9 ) $ — $ ( 0.9 ) $ ( 0.2 ) $ — $ ( 0.2 ) Three Months Ended Nine Months Ended (millions) Before Tax Amount Income Tax Net of Tax Amount Before Tax Amount Income Tax Net of Tax Amount Translation adjustments $ ( 0.6 ) $ — $ ( 0.6 ) $ ( 0.7 ) $ — $ ( 0.7 ) De-designation of interest rate collars — — — 0.7 0.2 0.5 Other comprehensive loss $ ( 0.6 ) $ — $ ( 0.6 ) $ — $ 0.2 $ ( 0.2 ) |
Components of Accumulated Other Comprehensive Loss | The changes to accumulated other comprehensive loss by component during the nine months ended September 30, 2023 (unaudited) were as follows: (millions) Foreign Total Accumulated Balance as of December 31, 2022 $ ( 1.8 ) $ ( 1.8 ) Other comprehensive loss before reclassification ( 0.2 ) ( 0.2 ) Balance as of September 30, 2023 $ ( 2.0 ) $ ( 2.0 ) The changes to accumulated other comprehensive loss by component during the nine months ended September 30, 2022 (unaudited) were as follows: (millions) Foreign Interest Rate Collars Total Accumulated Balance as of December 31, 2021 $ ( 2.3 ) $ ( 0.5 ) $ ( 2.8 ) Other comprehensive loss before reclassification ( 0.7 ) — ( 0.7 ) Amounts reclassified from accumulated other comprehensive loss — 0.5 0.5 Balance as of September 30, 2022 $ ( 3.0 ) $ — $ ( 3.0 ) |
Reclassification from Accumulated Other Comprehensive Loss | Reclassifications from accumulated other comprehensive loss during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: (millions) Three Months Ended Nine Months Ended Classification in the Condensed Consolidated Statements of Income Interest Rate Collars: 2023 2022 2023 2022 Net realized loss $ — $ — $ — $ 0.7 Other expenses Reclassifications before tax — — — 0.7 Income tax benefit — — — 0.2 Reclassifications, net of tax $ — $ — $ — $ 0.5 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information by Regions | Revenue, operating income (loss), general and administrative expenses and depreciation and amortization by operating segment during the three and nine months ended September 30, 2023 and 2022 (unaudited) were as follows: Three Months Ended Nine Months Ended (millions) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Services revenue Commercial Management type contracts $ 75.6 $ 68.2 $ 230.6 $ 206.0 Lease type contracts 70.9 68.6 207.9 194.9 Total Commercial 146.5 136.8 438.5 400.9 Aviation Management type contracts 77.9 66.7 216.0 176.6 Lease type contracts 4.0 3.6 11.5 10.5 Total Aviation 81.9 70.3 227.5 187.1 Reimbursed management type contract revenue 232.3 197.3 662.2 547.2 Total services revenue $ 460.7 $ 404.4 $ 1,328.2 $ 1,135.2 Operating income (loss) Commercial $ 35.7 $ 32.4 $ 103.0 $ 95.7 Aviation 10.6 9.7 28.8 26.3 Other ( 25.3 ) ( 18.3 ) ( 66.2 ) ( 52.5 ) Total operating income $ 21.0 $ 23.8 $ 65.6 $ 69.5 General and administrative expenses Commercial $ 9.8 $ 7.2 $ 27.3 $ 21.1 Aviation 4.8 3.1 12.7 8.7 Other 23.0 16.9 60.0 48.6 Total general and administrative expenses $ 37.6 $ 27.2 $ 100.0 $ 78.4 Depreciation and amortization Commercial (1) $ 3.8 $ 3.4 $ 11.2 $ 9.2 Aviation (2) 2.9 2.4 8.8 7.4 Other 2.3 1.4 6.2 3.9 Total depreciation and amortization $ 9.0 $ 7.2 $ 26.2 $ 20.5 (1) Included depreciation and amortization expenses related to cost of services activities of $ 2.0 million and $ 2.1 million during the three months ended September 30, 2023 and 2022 , respectively, and $ 6.1 million and $ 5.5 million during the nine months ended September 30, 2023 and 2022, respectively. (2) Included depreciation and amortization expenses related to cost of service activities of $ 1.4 million and $ 1.3 million during the three months ended September 30, 2023 and 2022 , respectively, and $ 4.2 million and $ 3.5 million during the nine months ended September 30, 2023 and 2022 , respectively. |
Significant Accounting Polici_3
Significant Accounting Policies and Practices - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) Partnership Voting_interest_model_entity Variable_interest_entity | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Significant Accounting Policies and Practices | |||||
Assets related to consolidated VIEs | $ 1,168.3 | $ 1,168.3 | $ 1,121.4 | ||
Liabilities related to consolidated VIEs | 916.2 | 916.2 | 895.7 | ||
Restricted cash and cash equivalents | 0.7 | 0.7 | 0.6 | ||
Allowance for doubtful accounts included in accounts receivable, net | 4.6 | $ 4.6 | 4 | ||
Number of ownership interest entities | Partnership | 26 | ||||
Investments under the equity method of accounting | 12.1 | $ 12.1 | 11.9 | ||
Equity earnings in related investments | 0.7 | $ 2.5 | 2 | $ 4 | |
Contingent cosideration liability | 1 | 1 | |||
Probability weighting of potential payouts | 1 | 1 | |||
Deferred tax assets | $ 0.3 | 0.3 | |||
Payment to former minority partner | $ 2.3 | ||||
Former minority partner payments term | 10 years | ||||
Additional payment to former minority partner | $ 4.5 | ||||
Minority partner payment included in accrued and other current liabilities | $ 2.3 | ||||
Internal-use Software | |||||
Significant Accounting Policies and Practices | |||||
Property, Plant and Equipment, Useful Life | 3 years | 3 years | |||
Minimum | Equipment [Member] | |||||
Significant Accounting Policies and Practices | |||||
Property, Plant and Equipment, Useful Life | 1 year | 1 year | |||
Minimum | Unconsolidated Entities | |||||
Significant Accounting Policies and Practices | |||||
Ownership interests percentage | 30% | 30% | |||
Maximum | Equipment [Member] | |||||
Significant Accounting Policies and Practices | |||||
Property, Plant and Equipment, Useful Life | 10 years | 10 years | |||
Maximum | Unconsolidated Entities | |||||
Significant Accounting Policies and Practices | |||||
Ownership interests percentage | 50% | 50% | |||
Primary Beneficiary | |||||
Significant Accounting Policies and Practices | |||||
Assets related to consolidated VIEs | $ 58.1 | $ 58.1 | 57.1 | ||
Liabilities related to consolidated VIEs | $ 45.9 | $ 45.9 | $ 50.9 | ||
Number of ownership interest entities | Variable_interest_entity | 20 | ||||
Not Primary Beneficiary | |||||
Significant Accounting Policies and Practices | |||||
Number of ownership interest entities | Voting_interest_model_entity | 6 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Jul. 25, 2023 | Nov. 10, 2022 | Oct. 11, 2022 | Apr. 18, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | |||||||||
Business Combination, Cash Aquired | $ 3.1 | ||||||||
Services revenue | $ 460.7 | $ 404.4 | 1,328.2 | $ 1,135.2 | |||||
Other Intangible Assets | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired intangible assets at purchasing price | $ 1.8 | ||||||||
Roker Inc. (Roker) | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Effective Date of Acquisition | Jul. 25, 2023 | ||||||||
Business Combination, Cash Aquired | $ 3.1 | ||||||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 0.9 | 0.9 | |||||||
Acquired intangible assets at purchasing price | 2.3 | ||||||||
Roker Inc. (Roker) | Other Intangible Assets | |||||||||
Business Acquisition [Line Items] | |||||||||
Services revenue | 0.1 | 0.1 | |||||||
Loss before income taxes | 0.1 | 0.1 | |||||||
Acquired intangible assets at purchasing price | 2.3 | ||||||||
KMP Associates Limited (KMP) | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Effective Date of Acquisition | Oct. 11, 2022 | ||||||||
Business Combination, Consideration Transferred, Total | $ 13.8 | ||||||||
Business Combination, Cash Aquired | 0.9 | ||||||||
Business Combination, Assumption Debt | $ 0.3 | ||||||||
Divrt, Inc. (Divrt) | |||||||||
Business Acquisition [Line Items] | |||||||||
Business Acquisition, Effective Date of Acquisition | Nov. 10, 2022 | ||||||||
Business Combination, Consideration Transferred, Total | $ 17.6 | ||||||||
Maximum Amount Of Contingent Consideration To Former Owner | 7 | ||||||||
Contingent consideration payable to former owner | 1.4 | 1.4 | |||||||
Accrued In Projected Contingent Consideration | $ 4 | ||||||||
Estimated Potential Payout | 4.4 | 4.4 | $ 4.1 | ||||||
Operating expense | 0.1 | 0.3 | |||||||
Kmp Associates Limited and Divrt Inc [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Acquired intangible assets at purchasing price | 23.5 | $ 23.5 | |||||||
Kmp Associates Limited and Divrt Inc [Member] | Other Intangible Assets | |||||||||
Business Acquisition [Line Items] | |||||||||
Services revenue | 1.5 | 4.7 | |||||||
Loss before income taxes | $ 0.9 | $ 2.6 |
Acquisitions - Schedule of Esti
Acquisitions - Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | ||
Goodwill | $ 544.2 | $ 543.2 |
Roker Inc. (Roker) | ||
Business Acquisition [Line Items] | ||
Other intangible assets | 2.3 | |
Goodwill | 0.9 | |
Accounts payable | (0.1) | |
Net cash paid | 3.1 | |
KMP Associates Limited and Divrt, Inc. | ||
Business Acquisition [Line Items] | ||
Cash and cash equivalents | 0.9 | |
Accounts receivable | 0.7 | |
Prepaid expenses and other current assets | 0.1 | |
Other intangible assets | 21.7 | |
Goodwill | 16.3 | |
ROU asset | 0.1 | |
Accounts payable | (0.1) | |
Accrued and other current liabilities | (1.5) | |
Deferred income tax liability | (2.5) | |
Other long-term borrowings | (0.3) | |
Net assets acquired and liabilities assumed | 35.4 | |
Less: cash and cash equivalents acquired | 0.9 | |
Less: contingent consideration payable | 4 | |
Net cash paid | $ 30.5 |
Acquisitions - Schedule of Othe
Acquisitions - Schedule of Other Assets Acquired were Recorded at their Estimated Fair Value (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||
Estimated Life | 6 years 8 months 12 days | |
Proprietary Know How | ||
Business Acquisition [Line Items] | ||
Estimated Life | 6 years 6 months | |
Customer Relationships | ||
Business Acquisition [Line Items] | ||
Estimated Life | 7 years 9 months 18 days | |
Covenant Not to Compete | ||
Business Acquisition [Line Items] | ||
Estimated Life | 3 years 6 months | |
Roker Inc. (Roker) | ||
Business Acquisition [Line Items] | ||
Estimated Fair Value | $ 2.3 | |
Roker Inc. (Roker) | Proprietary Know How | ||
Business Acquisition [Line Items] | ||
Estimated Life | 8 years | |
Estimated Fair Value | $ 2.1 | |
Roker Inc. (Roker) | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Estimated Life | 5 years 4 months 24 days | |
Estimated Fair Value | $ 0.2 | |
KMP Associates Limited and Divrt, Inc. | ||
Business Acquisition [Line Items] | ||
Estimated Fair Value | $ 23.5 | $ 23.5 |
KMP Associates Limited and Divrt, Inc. | Proprietary Know How | ||
Business Acquisition [Line Items] | ||
Estimated Life | 7 years 4 months 24 days | |
Estimated Fair Value | $ 17.3 | |
KMP Associates Limited and Divrt, Inc. | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Estimated Life | 5 years 9 months 18 days | |
Estimated Fair Value | $ 3.2 | |
KMP Associates Limited and Divrt, Inc. | Trade Names | ||
Business Acquisition [Line Items] | ||
Estimated Life | 13 years 2 months 12 days | |
Estimated Fair Value | $ 1.8 | |
KMP Associates Limited and Divrt, Inc. | Covenant Not to Compete | ||
Business Acquisition [Line Items] | ||
Estimated Life | 4 years 2 months 12 days | |
Estimated Fair Value | $ 1.2 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Lessor, Lease, Description [Line Items] | ||||
Sublease income | $ 0.6 | $ 0.4 | $ 1.6 | $ 1 |
Leases - Schedule of Components
Leases - Schedule of Components of ROU Assets and Lease Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Assets | ||
Right-of-use assets | $ 173.7 | $ 166.9 |
Leasehold improvements, equipment and construction in progress, net | $ 24.1 | $ 24.4 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net | Property and equipment, net |
Total leased assets | $ 197.8 | $ 191.3 |
Current | ||
Short-term lease liabilities | 56.4 | 60.2 |
Current portion of long-term borrowings | $ 7 | $ 7.2 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Current portion of long-term borrowings | Current portion of long-term borrowings |
Noncurrent | ||
Long-term lease liabilities | $ 154.9 | $ 158.5 |
Long-term borrowings, excluding current portion | $ 16 | $ 16 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-term borrowings, excluding current portion | Long-term borrowings, excluding current portion |
Total lease liabilities | $ 234.3 | $ 241.9 |
Leases - Schedule of Componen_2
Leases - Schedule of Components of Lease Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating lease cost | $ 15.7 | $ 15.5 | $ 44.7 | $ 45.2 |
Short-term lease | 4.5 | 4.5 | 14.7 | 14.9 |
Variable lease | 22.4 | 19.1 | 63.4 | 52.4 |
Operating lease cost | 42.6 | 39.1 | 122.8 | 112.5 |
Amortization of leased assets | 1.7 | 1.5 | 5 | 4.2 |
Interest on lease liabilities | 0.3 | 0.2 | 0.9 | 0.7 |
Net lease cost | $ 44.6 | $ 40.8 | $ 128.7 | $ 117.4 |
Leases - Schedule of Componen_3
Leases - Schedule of Components of Lease Cost (Parenthetical) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Lessor, Lease, Description [Line Items] | ||||
Operating lease cost | $ 15.7 | $ 15.5 | $ 44.7 | $ 45.2 |
Rent concessions cares act | 0.8 | 1.3 | 3.3 | 5 |
Office Space | ||||
Lessor, Lease, Description [Line Items] | ||||
Operating lease cost | $ 1 | $ 2.9 | $ 1 | $ 2.9 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Lease Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Operating Leases Liabilities | ||
2023 | $ 18.1 | |
2024 | 64.6 | |
2025 | 52.1 | |
2026 | 40.4 | |
2027 | 26.4 | |
After 2027 | 52.9 | |
Total lease payments | 254.5 | |
Less: Imputed interest | 43.2 | |
Present value of lease liabilities | $ 211.3 | |
Weighted-average remaining lease term (years) | 5 years 1 month 6 days | |
Weighted-average discount rate | 5.40% | |
Finance Leases Liabilities | ||
2023 | $ 2.3 | |
2024 | 7.6 | |
2025 | 5.6 | |
2026 | 4.4 | |
2027 | 2.5 | |
After 2027 | 3.3 | |
Total lease payments | 25.7 | |
Less: Imputed interest | 2.7 | |
Present value of lease liabilities | $ 23 | $ 23.2 |
Weighted-average remaining lease term (years) | 4 years 1 month 6 days | |
Weighted-average discount rate | 5.40% | |
Total | ||
2023 | $ 20.4 | |
2024 | 72.2 | |
2025 | 57.7 | |
2026 | 44.8 | |
2027 | 28.9 | |
After 2027 | 56.2 | |
Total lease payments | 280.2 | |
Less: Imputed interest | 45.9 | |
Present value of lease liabilities | $ 234.3 |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash outflows related to operating leases | $ 66.3 | $ 69 |
Operating cash outflows related to interest on finance leases | 0.9 | 0.7 |
Financing cash outflows related to finance leases | 5.7 | 7.7 |
Leased assets obtained in exchange for new operating liabilities | 49.3 | 12.4 |
Leased assets obtained in exchange for new finance lease liabilities | $ 5.6 | $ 5.8 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |||||
Negotiable cost reductions cares act | $ 2.7 | $ 3.1 | $ 8.3 | $ 9.2 | |
Performance obligation unsatisfied or partially satisfied | 198.3 | 198.3 | |||
Cost of contracts net of accumulated amortization | $ 2.4 | $ 2.4 | $ 2.9 |
Revenue - Schedule of Performan
Revenue - Schedule of Performance Obligations (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 198.3 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 21.1 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 64.2 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 40.8 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 31.6 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 19.6 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 21 |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 1 year |
Revenue - Schedule of Perform_2
Revenue - Schedule of Performance Obligations (Details 1) $ in Millions | Sep. 30, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining Performance Obligations | $ 198.3 |
Revenue - Schedule of Contract
Revenue - Schedule of Contract Asset and Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||||
Accounts receivable | $ 189 | $ 169.9 | ||
Contract asset | 0 | 1.8 | $ 0.2 | $ 2.3 |
Contract liabilities | $ (15.3) | $ (17.4) | $ (13.2) | $ (15.7) |
Revenue - Schedule of Contrac_2
Revenue - Schedule of Contract Assets Balances (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Contract Asset Balances with Customer | ||
Balance, beginning of period | $ 1.8 | $ 2.3 |
Additional contract assets | 0 | 0.2 |
Reclassification to accounts receivable | (1.8) | (2.3) |
Balance, end of period | $ 0 | $ 0.2 |
Revenue - Schedule of Contrac_3
Revenue - Schedule of Contract Liabilities Balances (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Contract Liability Balances with Customer | ||
Balance, beginning of period | $ (17.4) | $ (15.7) |
Additional contract liabilities | (15.3) | (13.2) |
Recognition of revenue from contract liabilities | 17.4 | 15.7 |
Balance, end of period | $ (15.3) | $ (13.2) |
Revenue - Schedule of Cost of C
Revenue - Schedule of Cost of Contracts Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | ||||
Cost of contracts expense | $ 0.2 | $ 0.3 | $ 0.7 | $ 0.8 |
Other Intangible Assets, net -
Other Intangible Assets, net - Components of Intangible Assets, Net (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 6 years 8 months 12 days | |
Intangible Assets, Gross | $ 135.6 | $ 133.2 |
Accumulated Amortization | (73.3) | (64.3) |
Intangible Assets, Net | $ 62.3 | 68.9 |
Management Contract Rights | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 5 years 9 months 18 days | |
Intangible Assets, Gross | $ 81 | 81 |
Accumulated Amortization | (56.7) | (52.9) |
Intangible Assets, Net | $ 24.3 | 28.1 |
Proprietary Know How | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 6 years 6 months | |
Intangible Assets, Gross | $ 23.8 | 21.7 |
Accumulated Amortization | (5.2) | (2.7) |
Intangible Assets, Net | $ 18.6 | 19 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 7 years 9 months 18 days | |
Intangible Assets, Gross | $ 25 | 24.8 |
Accumulated Amortization | (8.3) | (6.6) |
Intangible Assets, Net | $ 16.7 | 18.2 |
Trade Names and Trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 12 years 3 months 18 days | |
Intangible Assets, Gross | $ 2.9 | 2.8 |
Accumulated Amortization | (1.1) | (0.7) |
Intangible Assets, Net | $ 1.8 | 2.1 |
Covenant Not to Compete | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Life (Years) | 3 years 6 months | |
Intangible Assets, Gross | $ 2.9 | 2.9 |
Accumulated Amortization | (2) | (1.4) |
Intangible Assets, Net | $ 0.9 | $ 1.5 |
Other Intangible Assets, net _2
Other Intangible Assets, net - Summary of Amortization of Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 3 | $ 2.1 | $ 9 | $ 7 |
Goodwill - Schedule of Changes
Goodwill - Schedule of Changes in Carrying Amounts of Goodwill (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Goodwill [Line Items] | ||
Goodwill | $ 603.7 | $ 602.7 |
Accumulated impairment losses | (59.5) | (59.5) |
Total | 544.2 | 543.2 |
Acquisition | 0.9 | |
Foreign currency translation | 0.1 | |
Commercial | ||
Goodwill [Line Items] | ||
Goodwill | 387.9 | 387 |
Total | 387.9 | 387 |
Acquisition | 0.9 | |
Aviation | ||
Goodwill [Line Items] | ||
Goodwill | 215.8 | 215.7 |
Accumulated impairment losses | (59.5) | (59.5) |
Total | 156.3 | $ 156.2 |
Foreign currency translation | $ 0.1 |
Borrowing Arrangements - Schedu
Borrowing Arrangements - Schedule of Long-Term Borrowing (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Other borrowings | $ 24.1 | $ 24.3 |
Deferred financing costs | (2) | (2.4) |
Total obligations under Senior Credit Facility and other borrowings | 359.8 | 344.2 |
Less: Current portion of long-term borrowings | 14.7 | 12.4 |
Total long-term borrowings, excluding current portion | 345.1 | 331.8 |
Senior Credit Facility, Net of Original Discount on Borrowings | ||
Debt Instrument [Line Items] | ||
Total obligations under Senior Credit Facility and other borrowings | $ 337.7 | $ 322.3 |
Borrowing Arrangements - Sche_2
Borrowing Arrangements - Schedule of Long-Term Borrowing (Parenthetical) (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
Discount on borrowings | $ 1.1 | $ 1.3 |
Finance lease, liability | $ 23 | $ 23.2 |
Borrowing Arrangements - Narrat
Borrowing Arrangements - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||||
Apr. 21, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Feb. 16, 2021 | Nov. 30, 2018 | |
Debt Instrument [Line Items] | ||||||
Debt instrument, covenant compliance | As of September 30, 2023, the Company was in compliance with its debt covenants under the Amended Credit Agreement. | |||||
Long-term borrowings | $ 359,800,000 | $ 344,200,000 | ||||
Redemptions of convertible debentures | 0 | 0 | ||||
Approximate redemption value of convertible debentures | $ 1,100,000 | 1,100,000 | ||||
Letter of Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 6.70% | 4.60% | ||||
Senior Credit Facility, Net of Discount | ||||||
Debt Instrument [Line Items] | ||||||
Long-term borrowings | $ 337,700,000 | $ 322,300,000 | ||||
Convertible Subordinated Debt | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price upon stated maturity (in dollars per share) | $ 19.18 | |||||
Convertible debentures maturity per share | $ 25 | |||||
Amended Credit Agreement | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 600,000,000 | |||||
Line of credit facility, expiration date | Apr. 21, 2027 | |||||
Amended Credit Agreement | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | 400,000,000 | |||||
Amended Credit Agreement | Letter of Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 100,000,000 | |||||
Amended Credit Agreement | Term Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | $ 200,000,000 | |||||
Amended Credit Agreement | Senior Credit Facility, Net of Discount | ||||||
Debt Instrument [Line Items] | ||||||
Letters of credit outstanding | $ 39,100,000 | |||||
Long-term borrowings | $ 338,800,000 | |||||
Senior Credit Facility | Senior Credit Facility, Net of Discount | ||||||
Debt Instrument [Line Items] | ||||||
Weighted average interest rate | 7.20% | 4.90% |
Stock Repurchase Program - Narr
Stock Repurchase Program - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Feb. 14, 2023 | May 31, 2022 | |
Equity Class Of Treasury Stock [Line Items] | |||||
Amount authorized by the company's Board of Directors (not to exceed) | $ 120,000,000 | $ 60,000,000 | $ 60,000,000 | ||
Number of shares repurchased | 667,300 | 285,700 | 843,800 | ||
Average price paid per share (in dollars per share) | $ 33.08 | $ 36.53 | $ 32.77 | ||
Remaining authorized repurchase amount | $ 60,200,000 | ||||
Excise tax on net repurchases of common stock | 100,000 | ||||
May 2022 Stock Repurchase Program | |||||
Equity Class Of Treasury Stock [Line Items] | |||||
Remaining authorized repurchase amount | $ 200,000 |
Stock Repurchase Program - Summ
Stock Repurchase Program - Summary of Share Repurchase Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Equity [Abstract] | |||
Total number of shares repurchased | 667,300 | 285,700 | 843,800 |
Average price paid per share (in dollars per share) | $ 33.08 | $ 36.53 | $ 32.77 |
Total value of common stock repurchased | $ 22 | $ 10.4 | $ 27.6 |
Stock Repurchase Program - Su_2
Stock Repurchase Program - Summary of Remaining Authorized Repurchase Amounts (Details) - USD ($) | Sep. 30, 2023 | Feb. 14, 2023 | May 31, 2022 |
Equity [Abstract] | |||
Total authorized repurchase amount | $ 120,000,000 | $ 60,000,000 | $ 60,000,000 |
Total value of shares repurchased | 59,800,000 | ||
Total remaining authorized repurchase amount | $ 60,200,000 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Payment Arrangement | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 0.6 | $ 0.4 | |||
Grants in period (in shares) | 18,660 | 14,635 | |||
Restricted Stock Units | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 1.3 | $ 1.5 | $ 3.8 | $ 4.3 | |
Grants in period (in shares) | 126,931 | ||||
Unrecognized compensation expense related to unvested options | 6.9 | $ 6.9 | |||
Weighted average remaining recognition period of unrecognized stock-based compensation costs | 1 year 9 months 18 days | ||||
Restricted Stock Units | Executive Officer | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Grants in period (in shares) | 126,931 | 1,057 | |||
Vesting period | 3 years | 1 year | |||
Restricted Stock Units | Employees | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Grants in period (in shares) | 135,054 | ||||
Vesting period | 3 years | ||||
Performance Shares | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 1.4 | $ 0.7 | $ 3.7 | $ 1.9 | |
Grants in period (in shares) | 126,921 | ||||
Weighted average remaining recognition period of unrecognized stock-based compensation costs | 1 year 9 months 18 days | ||||
Maximum number of shares of common stock available for awards (in shares) | 253,842 | 258,114 | 253,842 | 258,114 | 97,096 |
Maximum number of payout shares of common stock available for awards (in shares) | 134,536 | 201,329 | 134,536 | 201,329 | 97,096 |
Unrecognized stock-based compensation expenses | $ 6.7 | $ 6.7 | |||
Performance Shares | Maximum | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Share-based payment arrangement, additional future stock-based compensation expenses | $ 4.1 | $ 1.7 | $ 4.1 | $ 1.7 | |
Performance Shares | Executive Officer | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Grants in period (in shares) | 126,921 | 132,304 | |||
Share-based compensation arrangement by share based payment award performance period | 3 years |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted and Performance Stock Units Rollforward (Details) | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Restricted Stock Units | |
Shares | |
Nonvested as of December 31, 2022 | shares | 338,448 |
Granted (in shares) | shares | 126,931 |
Vested (in shares) | shares | (8,426) |
Nonvested as of September 30, 2023 | shares | 456,953 |
Weighted Average Grant-Date Fair Value | |
Nonvested as of December 31, 2022 | $ / shares | $ 33.28 |
Granted (in dollars per share) | $ / shares | 34.57 |
Vested (in dollars per share) | $ / shares | 35.95 |
Nonvested as of September 30, 2023 | $ / shares | $ 33.62 |
Performance Shares | |
Shares | |
Nonvested as of December 31, 2022 | shares | 177,605 |
Granted (in shares) | shares | 126,921 |
Nonvested as of September 30, 2023 | shares | 304,526 |
Weighted Average Grant-Date Fair Value | |
Nonvested as of December 31, 2022 | $ / shares | $ 31.94 |
Granted (in dollars per share) | $ / shares | 34.57 |
Nonvested as of September 30, 2023 | $ / shares | $ 33.04 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Restricted Stock Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1.3 | $ 1.5 | $ 3.8 | $ 4.3 |
Performance Shares | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1.4 | $ 0.7 | $ 3.7 | $ 1.9 |
Net Income per Common Share - B
Net Income per Common Share - Basic and Diluted Net Income per Common Share and Weighted Average Common Shares Outstanding (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to SP Plus Corporation | $ 9.2 | $ 14.3 | $ 29.9 | $ 40.4 |
Basic weighted average common shares outstanding | 19,649,611 | 20,744,813 | 19,660,930 | 21,054,095 |
Dilutive impact of share-based awards | 260,697 | 232,854 | 213,235 | 169,887 |
Diluted weighted average common shares outstanding | 19,910,308 | 20,977,667 | 19,874,165 | 21,223,982 |
Net income per common share | ||||
Basic | $ 0.47 | $ 0.69 | $ 1.52 | $ 1.92 |
Diluted | $ 0.46 | $ 0.68 | $ 1.5 | $ 1.90 |
Net Income per Common Share - N
Net Income per Common Share - Narrative (Details) | 9 Months Ended |
Sep. 30, 2023 shares | |
Earnings Per Share [Abstract] | |
Potential shares of common stock attributable to stock options excluded from net income per common share calculation (in shares) | 0 |
Comprehensive Loss - Components
Comprehensive Loss - Components of Other Comprehensive Loss and Income Tax Benefit Allocated (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Other comprehensive loss before tax amount | $ (0.9) | $ (0.6) | $ (0.2) | |
Other comprehensive loss tax amount | $ 0.2 | |||
Other comprehensive loss net of tax amount | (0.9) | (0.6) | (0.2) | (0.2) |
Translation Adjustments | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Other comprehensive loss before tax amount | (0.9) | (0.6) | (0.2) | (0.7) |
Other comprehensive loss net of tax amount | $ (0.9) | $ (0.6) | $ (0.2) | (0.7) |
De-designation of interest rate collars | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Other comprehensive loss before tax amount | 0.7 | |||
Other comprehensive loss tax amount | 0.2 | |||
Other comprehensive loss net of tax amount | $ 0.5 |
Comprehensive Loss - Componen_2
Comprehensive Loss - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
AOCI Attributable to Parent, Net of Tax | ||
Beginning Balance | $ 226 | |
Ending Balance | 252.1 | |
Foreign Currency Translation Adjustments | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning Balance | (1.8) | $ (2.3) |
Other comprehensive loss before reclassification | (0.2) | (0.7) |
Ending Balance | (2) | (3) |
Interest Rate Collars | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning Balance | (0.5) | |
Amounts reclassified from accumulated other comprehensive loss | 0.5 | |
Accumulated Other Comprehensive Loss | ||
AOCI Attributable to Parent, Net of Tax | ||
Beginning Balance | (1.8) | (2.8) |
Other comprehensive loss before reclassification | (0.2) | (0.7) |
Amounts reclassified from accumulated other comprehensive loss | 0.5 | |
Ending Balance | $ (2) | $ (3) |
Comprehensive Loss - Reclassifi
Comprehensive Loss - Reclassifications from Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Net realized loss | $ (7.4) | $ (3.8) | $ (21.3) | $ (11.8) |
Reclassifications from Accumulated Other Comprehensive Loss | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Reclassifications before tax | 0.7 | |||
Income tax benefit | 0.2 | |||
Reclassifications, net of tax | 0.5 | |||
Reclassifications from Accumulated Other Comprehensive Loss | Interest Rate Collars: Net Realized Loss | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Net realized loss | $ 0.7 |
Segment Information - Schedule
Segment Information - Schedule of Segment Information by Regions (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Services revenue | ||||
Services revenue | $ 460.7 | $ 404.4 | $ 1,328.2 | $ 1,135.2 |
Total operating income (loss) | 21 | 23.8 | 65.6 | 69.5 |
General and administrative expenses | ||||
General and administrative expenses | 37.6 | 27.2 | 100 | 78.4 |
Depreciation and amortization | ||||
Depreciation and amortization | 9 | 7.2 | 26.2 | 20.5 |
Operating Segments | Commercial | ||||
Services revenue | ||||
Services revenue | 146.5 | 136.8 | 438.5 | 400.9 |
Total operating income (loss) | 35.7 | 32.4 | 103 | 95.7 |
General and administrative expenses | ||||
General and administrative expenses | 9.8 | 7.2 | 27.3 | 21.1 |
Depreciation and amortization | ||||
Depreciation and amortization | 3.8 | 3.4 | 11.2 | 9.2 |
Operating Segments | Aviation | ||||
Services revenue | ||||
Services revenue | 81.9 | 70.3 | 227.5 | 187.1 |
Total operating income (loss) | 10.6 | 9.7 | 28.8 | 26.3 |
General and administrative expenses | ||||
General and administrative expenses | 4.8 | 3.1 | 12.7 | 8.7 |
Depreciation and amortization | ||||
Depreciation and amortization | 2.9 | 2.4 | 8.8 | 7.4 |
Segment Reconciling Items | ||||
Services revenue | ||||
Total operating income (loss) | (25.3) | (18.3) | (66.2) | (52.5) |
General and administrative expenses | ||||
General and administrative expenses | 23 | 16.9 | 60 | 48.6 |
Depreciation and amortization | ||||
Depreciation and amortization | 2.3 | 1.4 | 6.2 | 3.9 |
Lease Type Contracts | ||||
Services revenue | ||||
Services revenue | 74.9 | 72.2 | 219.4 | 205.4 |
Lease Type Contracts | Operating Segments | Commercial | ||||
Services revenue | ||||
Services revenue | 70.9 | 68.6 | 207.9 | 194.9 |
Lease Type Contracts | Operating Segments | Aviation | ||||
Services revenue | ||||
Services revenue | 4 | 3.6 | 11.5 | 10.5 |
Management Type Contracts | ||||
Services revenue | ||||
Services revenue | 153.5 | 134.9 | 446.6 | 382.6 |
Management Type Contracts | Operating Segments | Commercial | ||||
Services revenue | ||||
Services revenue | 75.6 | 68.2 | 230.6 | 206 |
Management Type Contracts | Operating Segments | Aviation | ||||
Services revenue | ||||
Services revenue | 77.9 | 66.7 | 216 | 176.6 |
Reimbursed Management Type Contract Revenue | ||||
Services revenue | ||||
Services revenue | $ 232.3 | $ 197.3 | $ 662.2 | $ 547.2 |
Segment Information - Schedul_2
Segment Information - Schedule of Segment Information by Regions (Parenthetical) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Commercial | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expenses related to cost of services | $ 2 | $ 2.1 | $ 6.1 | $ 5.5 |
Aviation | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation and amortization expenses related to cost of services | $ 1.4 | $ 1.3 | $ 4.2 | $ 3.5 |
Subsequent Events - Narrative (
Subsequent Events - Narrative (Details) - Merger Agreement [Member] - Metropolis Technologies, Inc. [Member] - USD ($) $ / shares in Units, $ in Millions | Oct. 05, 2023 | Sep. 30, 2023 |
Subsequent Event [Line Items] | ||
Proposed merger related expenses incurred | $ 3.5 | |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Total enterprise value | $ 1,500 | |
Acquistion price of outstanding common stock | $ 54 |