Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 30, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | RNET | |
Entity Registrant Name | RigNet, Inc. | |
Entity Central Index Key | 1,162,112 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 19,363,507 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 21,858 | $ 34,598 |
Restricted cash | 45 | 43 |
Accounts receivable, net | 55,976 | 49,021 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 1,911 | 2,393 |
Prepaid expenses and other current assets | 6,080 | 5,591 |
Total current assets | 85,870 | 91,646 |
Property, plant and equipment, net | 60,953 | 60,344 |
Restricted cash | 1,546 | 1,500 |
Goodwill | 48,465 | 37,088 |
Intangibles, net | 39,774 | 30,405 |
Deferred tax and other assets | 8,651 | 9,111 |
TOTAL ASSETS | 245,259 | 230,094 |
Current liabilities: | ||
Accounts payable | 12,876 | 12,234 |
Accrued expenses | 14,016 | 16,089 |
Current maturities of long-term debt | 4,945 | 4,941 |
Income taxes payable | 1,485 | 1,601 |
Deferred revenue and other current liabilities | 10,623 | 8,511 |
Total current liabilities | 43,945 | 43,376 |
Long-term debt | 51,934 | 53,173 |
Deferred revenue | 487 | 546 |
Deferred tax liability | 3,821 | 189 |
Other liabilities | 33,308 | 25,533 |
Total liabilities | 133,495 | 122,817 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity | ||
Preferred stock - $0.001 par value; 10,000,000 shares authorized; no shares issued or outstanding at March 31, 2018 or December 31, 2017 | ||
Common stock - $0.001 par value; 191,000,000 shares authorized; 19,104,272 and 18,232,872 shares issued and outstanding at March 31, 2018 and December 31, 2017, respectively | 19 | 18 |
Treasury stock - 79,986 and 5,516 shares at March 31, 2018 and December 31, 2017, respectively, at cost | (1,096) | (116) |
Additional paid-in capital | 165,625 | 155,829 |
Accumulated deficit | (39,620) | (33,726) |
Accumulated other comprehensive loss | (13,206) | (14,806) |
Total stockholders' equity | 111,722 | 107,199 |
Non-redeemable, non-controlling interest | 42 | 78 |
Total equity | 111,764 | 107,277 |
TOTAL LIABILITIES AND EQUITY | $ 245,259 | $ 230,094 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 191,000,000 | 191,000,000 |
Common stock, shares issued | 19,104,272 | 18,232,872 |
Common stock, shares outstanding | 19,104,272 | 18,232,872 |
Treasury stock, shares | 79,986 | 5,516 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Income Statement [Abstract] | ||
Revenue | $ 53,833 | $ 48,072 |
Expenses: | ||
Cost of revenue (excluding depreciation and amortization) | 33,681 | 29,875 |
Depreciation and amortization | 7,987 | 7,316 |
Selling and marketing | 2,949 | 1,436 |
General and administrative | 13,686 | 10,512 |
Total expenses | 58,303 | 49,139 |
Operating income (loss) | (4,470) | (1,067) |
Other income (expense): | ||
Interest expense | (959) | (619) |
Other income (expense), net | 506 | 113 |
Loss before income taxes | (4,923) | (1,573) |
Income tax expense | (603) | (414) |
Net loss | (5,526) | (1,987) |
Less: Net income attributable to non-redeemable, non-controlling interest | 30 | 39 |
Net loss attributable to RigNet, Inc. stockholders | (5,556) | (2,026) |
COMPREHENSIVE LOSS | ||
Net loss | (5,526) | (1,987) |
Foreign currency translation | 1,600 | 861 |
Comprehensive loss | (3,926) | (1,126) |
Less: Comprehensive income (loss) attributable to non-controlling interest | 30 | 39 |
Comprehensive loss attributable to RigNet, Inc. stockholders | (3,956) | (1,165) |
LOSS PER SHARE - BASIC AND DILUTED | ||
Net loss attributable to RigNet, Inc. common stockholders | $ (5,556) | $ (2,026) |
Net loss per share attributable to RigNet, Inc. common stockholders, basic | $ (0.31) | $ (0.11) |
Net loss per share attributable to RigNet, Inc. common stockholders, diluted | $ (0.31) | $ (0.11) |
Weighted average shares outstanding, basic | 18,146 | 17,873 |
Weighted average shares outstanding, diluted | 18,146 | 17,873 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash flows from operating activities: | ||
Net loss | $ (5,526) | $ (1,987) |
Adjustments to reconcile net loss to net cash provided by operations: | ||
Depreciation and amortization | 7,987 | 7,316 |
Stock-based compensation | 2,445 | 826 |
Amortization of deferred financing costs | 51 | 98 |
Deferred taxes | 449 | 437 |
Change in fair value of earn-out/contingent consideration | 22 | |
Accretion of discount of contingent consideration payable for acquisitions | 162 | 123 |
(Gain) loss on sales of property, plant and equipment, net of retirements | (53) | 37 |
Changes in operating assets and liabilities, net of effect of acquisition: | ||
Accounts receivable | (6,255) | 1,865 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 520 | (766) |
Prepaid expenses and other assets | (1,012) | 32 |
Accounts payable | (999) | 2,406 |
Accrued expenses | (2,033) | (1,969) |
Deferred revenue and other assets | 1,905 | 300 |
Other liabilities | 425 | 88 |
Net cash (used in) provided by operating activities | (1,912) | 8,806 |
Cash flows from investing activities: | ||
Acquisitions | (3,202) | |
Capital expenditures | (5,099) | (3,936) |
Proceeds from sales of property, plant and equipment | 149 | 39 |
Net cash used in investing activities | (8,152) | (3,897) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock net of stock witheld to cover employee taxes on stock-based compensation | (967) | 682 |
Subsidiary distributions to non-controlling interest | (66) | |
Repayments of long-term debt | (1,286) | (7,321) |
Net cash used in financing activities | (2,319) | (6,639) |
Net change in cash and cash equivalents | (12,383) | (1,730) |
Cash and cash equivalents including restricted cash: | ||
Balance, January 1, | 36,141 | 58,805 |
Changes in foreign currency translation | (309) | (296) |
Balance, March 31, | 23,449 | 56,779 |
Supplemental disclosures: | ||
Income taxes paid | 629 | 447 |
Interest paid | 665 | 453 |
Non-cash investing - capital expenditures accrued | 3,186 | $ 1,270 |
Non-cash investing - contingent consideration for acquisitions | 7,600 | |
Non-cash investing and financing - stock for acquisitions | 7,340 | |
Liabilities assumed in acquisitions | $ 4,285 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 |
Statement of Cash Flows [Abstract] | ||||
Cash and cash equivalents | $ 21,858 | $ 34,598 | ||
Restricted cash - current portion | 45 | 43 | ||
Restricted cash - long-term portion | 1,546 | 1,500 | ||
Cash and cash equivalents including restricted cash | $ 23,449 | $ 36,141 | $ 56,779 | $ 58,805 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings (Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total Stockholders' Equity [Member] | Non-Redeemable, Non-Controlling Interest [Member] |
Beginning Balance at Dec. 31, 2016 | $ 112,578 | $ 18 | $ 147,906 | $ (17,550) | $ (17,971) | $ 112,403 | $ 175 | |
Beginning Balance, shares at Dec. 31, 2016 | 17,933,000 | |||||||
Issuance of common stock upon the exercise of stock options | 798 | 798 | 798 | |||||
Issuance of common stock upon the exercise of stock options, shares | 57,000 | |||||||
Issuance of common stock upon the vesting of Restricted Stock Units, net of share cancellations | 0 | $ 0 | $ 0 | 0 | 0 | 0 | 0 | 0 |
Issuance of common stock upon the vesting of Restricted Stock Units, net of share cancellations, shares | 50,000 | |||||||
Stock withheld to cover employee taxes on stock-based compensation | (116) | $ (116) | (116) | |||||
Stock withheld to cover employee taxes on stock-based compensation, shares | (6,000) | 6,000 | ||||||
Stock-based compensation | 826 | 826 | 826 | |||||
Foreign currency translation | 861 | 861 | 861 | |||||
Net income (loss) | (1,987) | (2,026) | (2,026) | 39 | ||||
Ending Balance at Mar. 31, 2017 | 112,960 | $ 18 | $ (116) | 149,530 | (19,576) | (17,110) | 112,746 | 214 |
Ending Balance, shares at Mar. 31, 2017 | 18,034,000 | 6,000 | ||||||
Beginning Balance at Dec. 31, 2017 | $ 107,277 | $ 18 | $ (116) | 155,829 | (33,726) | (14,806) | 107,199 | 78 |
Beginning Balance, shares at Dec. 31, 2017 | 18,232,872 | 18,233,000 | 6,000 | |||||
Issuance of common stock upon the exercise of stock options | $ 12 | 12 | 12 | |||||
Issuance of common stock upon the exercise of stock options, shares | 1,000 | |||||||
Issuance of common stock upon the vesting of Restricted Stock Units, net of share cancellations | 0 | $ 0 | $ 0 | 0 | 0 | 0 | 0 | 0 |
Issuance of common stock upon the vesting of Restricted Stock Units, net of share cancellations, shares | 340,000 | |||||||
Issuance of common stock upon the acquisition of Intelie | 7,340 | $ 1 | 7,339 | 7,340 | ||||
Issuance of common stock upon the acquisition of Intelie, shares | 530,000 | |||||||
Stock withheld to cover employee taxes on stock-based compensation | (980) | $ (980) | (980) | |||||
Stock withheld to cover employee taxes on stock-based compensation, shares | 74,000 | |||||||
Stock-based compensation | 2,445 | 2,445 | 2,445 | |||||
Foreign currency translation | 1,600 | 1,600 | 1,600 | |||||
Non-controlling owner distributions | (66) | (66) | ||||||
Net income (loss) | (5,526) | (5,556) | (5,556) | 30 | ||||
Ending Balance at Mar. 31, 2018 | $ 111,764 | $ 19 | $ (1,096) | $ 165,625 | (39,620) | $ (13,206) | 111,722 | $ 42 |
Ending Balance, shares at Mar. 31, 2018 | 19,104,272 | 19,104,000 | 80,000 | |||||
Cumulative effect adjustment from implementation of ASU 2016-16 | $ (338) | $ (338) | $ (338) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1 – Basis of Presentation The interim unaudited condensed consolidated financial statements of RigNet, Inc. (the Company or RigNet) include all adjustments which, in the opinion of management, are necessary for a fair presentation of the Company’s financial position and results of operations. All such adjustments are of a normal recurring nature. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and Rule 10-01 of Regulation S-X. The preparation of these financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying footnotes. Estimates and assumptions about future events and their effects cannot be perceived with certainty. Estimates may change as new events occur, as more experience is acquired, as additional information becomes available and as the Company’s operating environment changes. Actual results could differ from estimates. These interim financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2018. Significant Accounting Policies Please refer to RigNet’s Annual Report on Form 10-K for fiscal year 2017 for information regarding the Company’s accounting policies. Revenue Recognition - Revenue from Contracts with Customers Revenue is recognized to depict the transfer of promised goods or services in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Revenue Recognition - Managed Services and Applications and Internet-of-Things Managed Services and Applications and Internet-of-Things customers are primarily served under fixed-price contracts, either on a monthly or day rate basis or for equipment sales. Our contracts are generally in the form of Master Service Agreements, or MSAs, with specific services being provided under individual service orders that have a term of one to three years with renewal options, while land-based locations are generally shorter term or terminable on short notice without a penalty. Service orders are executed under the MSA for individual remote sites or groups of sites, and generally permit early termination on short notice without penalty in the event of force majeure, breach of the MSA or cold stacking of a drilling rig (when a rig is taken out of service and is expected to be idle for a protracted period of time). Performance Obligations Satisfied Over Time Performance Obligations Satisfied at a Point in Time Revenue Recognition – Systems Integration Revenues related to long-term, fixed-price Systems Integration contracts for customized network solutions are recognized based on the percentage of completion for the contract. At any point, RigNet has numerous contracts in progress, all of which are at various stages of completion. Accounting for revenues and profits on long-term contracts requires estimates of total estimated contract costs and estimates of progress toward completion to determine the extent of revenue and profit recognition. Performance Obligations Satisfied Over Time — The delivery of a Systems Integration solution represents the single performance obligation under Systems Integration contracts. Progress towards completion on fixed price contracts is measured based on the ratio of costs incurred to total estimated contract costs (the cost-to-cost method). These estimates may be revised as additional information becomes available or as specific project circumstances change. The Company reviews all material contracts on a monthly basis and revises the estimates as appropriate for developments such as, providing services, purchasing third-party materials and equipment at costs differing from those previously estimated, and incurring or expecting to incur schedule issues. Changes in estimated final contract revenues and costs can either increase or decrease the final estimated contract profit or loss. Profits are recorded in the period in which a change in estimate is recognized, based on progress achieved through the period of change. Anticipated losses on contracts are recorded in full in the period in which they become evident. Revenue recognized in excess of amounts billed is classified as a current asset under costs and estimated earnings in excess of billings on uncompleted contracts. Systems Integration contracts are billed in accordance with the terms of the contract which are typically either based on milestones or specified time intervals. As of March 31, 2018 and December 31, 2017, the amount of costs and estimated earnings in excess of billings on uncompleted contracts related to Systems Integration projects was $1.9 million and $2.4 million, respectively. Under long-term contracts, amounts recorded in costs and estimated earnings in excess of billings on uncompleted contracts may not be realized or paid, respectively, within a one-year period. As of March 31, 2018 and December 31, 2017, $0.8 million and $0.4 million, respectively, of amounts billed to customers in excess of revenue recognized to date are classified as a current liability, under deferred revenue. All of the billings in excess of costs as of December 31, 2017 were recognized as revenue during the three months ended March 31, 2018. The Company records revenue on contracts relating to certain probable claims and unapproved change orders by including in revenue an amount less than or equal to the amount of costs incurred to date relating to these probable claims and unapproved change orders, thus recognizing no profit until such time as claims are finalized or change orders are approved. The amount of unapproved change orders and claim revenues is included in the Company’s Consolidated Balance Sheets as part of costs and estimated earnings in excess of billings on uncompleted contracts. No material unapproved change orders and claims revenue were included in costs and estimated earnings in excess of billings on uncompleted contracts as of March 31, 2018 and December 31, 2017. As new facts become known, an adjustment to the estimated recovery is made and reflected in the current period. Backlog - As of March 31, 2018, we have backlog for our Systems Integration projects of $23.5 million, which will be recognized over the remaining contract term for each contract. Systems Integration contract terms are typically one to three years. Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers (Topic 606). The core principle of this amendment is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued Accounting Standards Update No. 2015-14 (ASU 2015-14), Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date. In March 2016, the FASB issued Accounting Standards Update No. 2016-08 (ASU 2016-08), Revenue from Contracts with Customers: Principal versus Agent Considerations. The amendments are intended to improve the operability and understandability of the implementation guidance on principal versus agent considerations. In April and May of 2016, the FASB issued Accounting Standards Update No. 2016-10 (ASU 2016-10) and Accounting Standards Update No. 2016-12 (ASU 2016-12), Revenue from Contracts with Customers (Topic 606), respectively, that provide scope amendments, performance obligations clarification and practical expedients. These ASUs allow for the use of either the full or modified retrospective transition method and are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with early adoption permitted for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. The Company adopted this ASU on January 1, 2018. The Company’s evaluation of this ASU included a detailed review of representative contracts from each segment and comparing historical accounting policies and practices to the new standard. The adoption of this ASU did not have any material impact on the Company’s condensed consolidated financial statements. In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (ASU 2016-02), Leases. This ASU is effective for annual reporting periods beginning after December 15, 2018. This ASU introduces a new lessee model that generally brings leases on the balance sheet. The Company is currently in the process of evaluating the impact the adoption of this ASU will have on the Company’s condensed consolidated financial statements. In August 2016, the FASB issued Accounting Standards Update No. 2016-15 (ASU 2016-15), Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. The new ASU reduces diversity of practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under Topic 230, Statement of Cash Flows, and other Topics, including the treatment of contingent consideration payments made after a business combination. The ASU is effective for annual and interim reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company adopted this ASU on January 1, 2018. The adoption of this ASU did not have any material impact on the Company’s condensed consolidated financial statements. In October 2016, the FASB issued Accounting Standards Update No. 2016-16 (ASU 2016-16), Income Taxes: Intra-Entity Transfer of Assets Other Than Inventory. The new ASU requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than the previous requirement to defer recognition of current and deferred income taxes for an intra-entity asset transfer until the asset had been sold to an outside party. The ASU is effective for annual and interim reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company adopted this ASU on January 1, 2018 using the modified retrospective method, through a $0.3 million cumulative effect that directly lowered accumulated deficit. The adoption of this ASU did not have any material impact on the Company’s condensed consolidated financial statements. In November 2016, the FASB issued Accounting Standards Update No. 2016-18 (ASU 2016-18), which includes restricted cash in the cash and cash equivalents balance in the statement of cash flows. The ASU is effective for annual and interim reporting periods beginning after December 15, 2017. The Company adopted this ASU on January 1, 2018. The adoption of this ASU did not have any material impact on the Company’s condensed consolidated financial statements. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Business Combinations | Note 2 – Business Combinations Auto-Comm and SAFCON On April 18, 2018, RigNet completed the separate acquisitions of Automation Communications Engineering Corp. (Auto-Comm) and Safety Controls, Inc. (SAFCON) for an aggregate purchase price of $6.3 million. Of this aggregate purchase price, RigNet paid $2.2 million in cash and $4.1 million in stock. Auto-Comm provides a broad range of communications services, for both onshore and offshore remote locations, to the oil and gas industry. Auto-Comm brings over 30 years of systems integration experience in engineering and design, installation, testing, and maintenance. SAFCON offers a diverse set of safety, security, and maintenance services to the oil and gas industry. Auto-Comm and SAFCON have developed strong relationships with major energy companies that complement the relationships that RigNet has established over the years. Auto-Comm and SAFCON are based in Louisiana. Due to the limited time since the acquisition date, the initial accounting for the business combination is incomplete at this time. As a result, the Company is unable to provide amounts recognized as of the acquisition date for major classes of assets and liabilities acquired and resulting from the transaction, including any intangible assets or goodwill. The Company is also unable to provide supplemental pro forma revenue and earnings of the combined entity. This information will be included in the Company’s Quarterly Report on Form 10-Q Intelie On March 23, 2018, RigNet completed its acquisition of Intelie Soluções Em Informática S.A (Intelie), for an estimated aggregate purchase price of $18.1 million. Of this aggregate purchase price, RigNet paid R$10.6 million (BRL) (or approximately $3.2 million) in cash, $7.3 million in stock and expects to pay $7.6 million worth of RigNet stock as contingent consideration earn-out, earn-out earn-out The assets and liabilities of Intelie have been recorded at their estimated fair values at the date of acquisition. The excess of the purchase price over the estimated fair values of the underlying net tangible and identifiable intangible assets and liabilities has been recorded as goodwill. The earn-out earn-out earn-out The goodwill of $10.7 million arising from the acquisition consists largely of growth prospects, synergies and other benefits that the Company believes will result from combining the operations of the Company and Intelie, as well as other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. None of the goodwill recognized is expected to be deductible for income tax purposes. The acquisition of Intelie, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Life (Years) Fair Market Values (in thousands) Current assets $ 589 Property and equipment 73 Trade name 7 2,300 Technology 7 8,400 Customer relationships 7 320 Total identifiable intangible assets 11,020 Goodwill 10,744 Current liabilities (460 ) Deferred tax liability (3,825 ) Total purchase price $ 18,141 (a) (a) Includes $7.6 million in contingent consideration earn-out Actual and Pro Forma Impact of the Intelie Acquisition Intelie’s revenue and net loss were $0.1 million and $0.1 million, respectively, for the three months ended March 31, 2018. The following table represents supplemental pro forma information as if the Intelie acquisition had occurred on January 1, 2017. Three Months Ended March 31, Three Months Ended March 31, 2018 2017 (in thousands, except per share amounts) Revenue $ 54,512 $ 48,395 Expenses 59,942 50,477 Net loss $ (5,430 ) $ (2,082 ) Net loss attributable to RigNet, Inc. common stockholders $ (5,460 ) $ (2,121 ) Net loss per share attributable to RigNet, Inc. common stockholders: Basic $ (0.30 ) $ (0.12 ) Diluted $ (0.30 ) $ (0.12 ) The Company incurred acquisition related costs of $0.8 million in the three months ended March 31, 2018 reported in general and administrative expenses. Energy Satellite Services On July 28, 2017, RigNet acquired substantially all the assets of Energy Satellite Services (ESS). ESS is a supplier of wireless communications services via satellite networks primarily to the midstream sector of the oil and gas industry for remote pipeline monitoring. The assets acquired enhance RigNet’s Supervisory Control and Data Acquisition (SCADA) customer portfolio, and strengthen the Company’s US land and Internet-of-Things The assets and liabilities of ESS have been recorded at their estimated fair values at the date of acquisition. The excess of the purchase price over the estimated fair values of the underlying net tangible and identifiable intangible assets and liabilities has been recorded as goodwill. The goodwill of $8.5 million arising from the acquisition consists largely of growth prospects, synergies and other benefits that the Company believes will result from combining the operations of the Company and ESS, as well as other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. The goodwill recognized is expected to be deductible for income tax purposes. The acquisition of ESS, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Estimated Useful Life (Years) Fair Market Values (in thousands) Accounts receivable $ 392 Property and equipment 1,000 Covenant not to compete 5 3,040 Customer relationships 7 9,870 Total identifiable intangible assets 12,910 Goodwill 8,465 Accounts payable (567 ) Total purchase price $ 22,200 Data Technology Solutions On July 24, 2017, RigNet acquired substantially all the assets of Data Technology Solutions (DTS). DTS provides comprehensive communications and IT services to the onshore, offshore, and maritime industries, as well as disaster relief solutions to global corporate clients. The Company paid $5.1 million in cash for the DTS assets. DTS is based in Louisiana. The assets and liabilities of DTS have been recorded at their estimated fair values at the date of acquisition. The excess of the purchase price over the estimated fair values of the underlying net tangible and identifiable intangible assets and liabilities has been recorded as goodwill. The goodwill of $0.7 million arising from the acquisition consists largely of growth prospects, synergies and other benefits that the Company believes will result from combining the operations of the Company and DTS, as well as other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. The goodwill recognized is expected to be deductible for income tax purposes. The acquisition of DTS, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Managed Services segment. Fair Market Values (in thousands) Property and equipment $ 4,553 Goodwill 704 Accounts payable (152 ) Total purchase price $ 5,105 Cyphre Security Solutions On May 18, 2017, RigNet completed its acquisition of Cyphre Security Solutions (Cyphre) for an estimated aggregate purchase price of $12.0 million. Of this aggregate purchase price, RigNet paid $4.9 million in cash in May 2017, $3.3 million in stock and expects to pay $3.8 million of contingent consideration for intellectual property, estimated as of the date of acquisition. The initial estimate of the contingent consideration for intellectual property is preliminary and remains subject to change based on certain post-closing contractual options under the acquisition agreement. Cyphre is a cybersecurity company that provides advanced enterprise data protection leveraging BlackTIE ® The contingent consideration for Cyphre is measured at fair value, based on level 3 inputs, with any change to fair value recorded in the Condensed Consolidated Statements of Comprehensive Loss in each reporting period. As of March 31, 2018, the fair value of the contingent consideration was $3.9 million. During the three months ended March 31, 2018, RigNet recognized accreted interest expense on the Cyphre contingent consideration of $0.1 million with corresponding increases to other liabilities. The assets and liabilities of Cyphre have been recorded at their estimated fair values at the date of acquisition. The excess of the purchase price over the estimated fair values of the underlying net tangible and identifiable intangible assets and liabilities has been recorded as goodwill. The goodwill of $4.6 million arising from the acquisition consists largely of growth prospects, synergies and other benefits that the Company believes will result from combining the operations of the Company and Cyphre, as well as other intangible assets that do not qualify for separate recognition, such as assembled workforce in place at the date of acquisition. The goodwill recognized is expected to be deductible for income tax purposes. The acquisition of Cyphre, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Estimated Useful Life (Years) Fair Market Values (in thousands) Property and equipment $ 18 Trade name 7 1,590 Technology 7 5,571 Customer relationships 7 332 Total identifiable intangible assets 7,493 Goodwill 4,591 Accrued expenses (100 ) Total purchase price $ 12,002 (a) (a) Includes $3.8 million in contingent consideration estimated as of the date of acquisition. Actual and Pro Forma Impact of the 2017 Acquisitions The 2017 acquisitions of ESS, DTS and Cyphre contributed $2.9 million of revenue and $1.9 million to net income for the three months ended March 31, 2018. The following table represents supplemental pro forma information as if the 2017 acquisitions had occurred on January 1, 2017. Three Months Ended March 31, 2017 (in thousands, except per Revenue $ 52,915 Expenses 53,283 Net loss $ (368 ) Net loss attributable to RigNet, Inc. common stockholders $ (407 ) Net loss per share attributable to RigNet, Inc. common stockholders: Basic $ (0.02 ) Diluted $ (0.02 ) |
Business and Credit Concentrati
Business and Credit Concentrations | 3 Months Ended |
Mar. 31, 2018 | |
Risks and Uncertainties [Abstract] | |
Business and Credit Concentrations | Note 3 – Business and Credit Concentrations The Company is exposed to various business and credit risks including interest rate, foreign currency, credit and liquidity risks. Interest Rate Risk The Company has significant interest-bearing liabilities at variable interest rates which generally price monthly. The Company’s variable borrowing rates are tied to LIBOR resulting in interest rate risk (see Note 6 – Long-Term Debt). The Company presently does not use financial instruments to hedge interest rate risk, but evaluates this on a regular basis and may utilize financial instruments in the future if deemed necessary. Foreign Currency Risk The Company has exposure to foreign currency risk, as a portion of the Company’s activities are conducted in currencies other than U.S. dollars. Currently, the Norwegian Krone, the British Pound Sterling and the Brazilian Real are the currencies that could materially impact the Company’s financial position and results of operations. The Company presently does not hedge these risks, but evaluates financial risk on a regular basis and may utilize financial instruments in the future if deemed necessary. Foreign currency translations are reported as accumulated other comprehensive loss in the Company’s condensed consolidated financial statements. Credit Risk Credit risk, with respect to accounts receivable, is due to the limited number of customers concentrated in the oil and gas, maritime, pipeline, engineering and construction industries. The Company mitigates the risk of financial loss from defaults through defined collection terms in each contract or service agreement and periodic evaluations of the collectability of accounts receivable. The Company provides an allowance for doubtful accounts which is adjusted when the Company becomes aware of a specific customer’s inability to meet its financial obligations or as a result of changes in the overall aging of accounts receivable. Liquidity Risk The Company maintains cash and cash equivalent balances with major financial institutions which, at times, exceed federally insured limits. The Company monitors the financial condition of the financial institutions and has not experienced losses associated with these accounts during 2018 or 2017. Liquidity risk is managed by continuously monitoring forecasted and actual cash flows and by matching the maturity profiles of financial assets and liabilities (see Note 6 – Long-Term Debt). |
Goodwill and Intangibles
Goodwill and Intangibles | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Note 4 – Goodwill and Intangibles Goodwill Goodwill resulted from prior acquisitions as the consideration paid for the acquired businesses exceeded the fair value of acquired identifiable net tangible and intangible assets. Goodwill is reviewed for impairment at least annually with additional evaluations being performed when events or circumstances indicate that the carrying value of these assets may not be recoverable. Due to the change in segments (see Note 12 – Segment Information) and reporting units during the third quarter of 2017, the Company re-allocated The Company acquired $10.7 million of goodwill in the Intelie acquisition completed on March 23, 2018 (see Note 2 – Business Combinations). The Company acquired $8.5 million of goodwill in the ESS acquisition completed on July 28, 2017 (see Note 2 – Business Combinations). The Company acquired $0.7 million of goodwill in the DTS acquisition completed on July 24, 2017 (see Note 2 – Business Combinations). The Company acquired $4.6 million of goodwill in the Cyphre acquisition completed on May 18, 2017 (see Note 2 – Business Combinations). The Company performs its annual impairment test on July 31 st As of November 30, 2017, the Company’s latest completed interim goodwill impairment testing, the fair values of the Company’s reporting units are substantially in excess of their carrying values. As such, the test resulted in no impairment. The November 30, 2017 interim test was conducted due to a change in segments after the Company completed the acquisition of ESS. No impairment indicators have been identified in any reporting unit as of March 31, 2018 and December 31, 2017. As of March 31, 2018 and December 31, 2017, goodwill was $48.5 million and $37.1 million, respectively. Goodwill increases or decreases in value due to the effect of foreign currency translation, and increases with acquisitions. Intangibles Intangibles consist of customer relationships, brand name, backlog, technology and licenses acquired as part of the Company’s acquisitions. Intangibles also include internal-use No impairment indicators have been identified in any reporting unit as of March 31, 2018. As of March 31, 2018 and December 31, 2017, intangibles were $39.8 million and $30.4 million, respectively. During the three months ended March 31, 2018 and 2017, the Company recognized amortization expense of $2.1 million and $1.3 million, respectively. The following table sets forth expected amortization expense of intangibles for the remainder of 2018 and the following years (in thousands): 2018 6,406 2019 7,508 2020 6,478 2021 6,104 2022 5,767 Thereafter 7,511 $ 39,774 |
Restricted Cash
Restricted Cash | 3 Months Ended |
Mar. 31, 2018 | |
Cash and Cash Equivalents [Abstract] | |
Restricted Cash | Note 5 – Restricted Cash As of March 31, 2018 and December 31, 2017, the Company had restricted cash of $0.1 million and $1.5 million, in current and long-term assets, respectively. The restricted cash in long-term assets was primarily used to collateralize a performance bond in the Managed Services segment (see Note 6 – Long-Term Debt). |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 6 – Long-Term Debt As of March 31, 2018 and December 31, 2017, the following credit facilities and long-term debt arrangements with financial institutions were in place: March 31, December 31, 2018 2017 (in thousands) Term loan, net of unamortized deferred financing costs $ 13,300 $ 14,503 Revolving loan 43,400 43,400 Capital lease 179 211 56,879 58,114 Less: Current maturities of long-term debt (4,818 ) (4,814 ) Current maturities of capital lease (127 ) (127 ) $ 51,934 $ 53,173 Credit Agreement On November 6, 2017, the Company entered into its third amended and restated credit agreement with four participating financial institutions. The credit agreement provides for a $15.0 million term loan facility (Term Loan) and an $85.0 million revolving credit facility (RCF) and matures on November 6, 2020. The RCF contains a sub-limit stand-by Under the credit agreement, both the Term Loan and RCF bear interest at a rate of LIBOR plus a margin ranging from 1.75% to 2.75% based on a consolidated leverage ratio defined in the credit agreement. Interest is payable monthly and principal installments of $1.25 million under the Term Loan are due quarterly beginning March 31, 2018. The weighted average interest rate for the three months ended March 31, 2018 and 2017 were 4.2% and 3.0%, respectively, with an interest rate of 4.6% at March 31, 2018. Term Loan As of March 31, 2018, the Term Loan had an outstanding principal balance of $13.8 million. RCF As of March 31, 2018, $43.4 million in draws remain outstanding under the RCF. Covenants and Restrictions The Company’s credit agreement contains certain covenants and restrictions, including restricting the payment of cash dividends under default and maintaining certain financial covenants such as a consolidated leverage ratio, defined in the credit agreement, of less than or equal to 2.75 to 1.0 and a consolidated fixed charge coverage ratio of not less than 1.25 to 1.0 as of March 31, 2018. If any default occurs related to these covenants, the unpaid principal and any accrued interest shall be declared immediately due and payable. As of March 31, 2018, and December 31, 2017, the Company believes it was in compliance with all covenants. Performance Bonds and Letters of Credit On September 14, 2012, NesscoInvsat Limited, a subsidiary of RigNet, secured a performance bond facility. On November 6, 2017, this facility became a part of the third amended and restated credit agreement and falls under the $25.0 million sub-limit As of March 31, 2018, there were $0.6 million in standby letters of credit. In June 2016, the Company secured a performance bond facility with a lender in the amount of $1.5 million for its Managed Services segment. This facility has a maturity date of June 2021. The Company maintains restricted cash on a dollar for dollar basis to secure this facility. Debt Maturities The following table sets forth the aggregate principal maturities of long-term debt, net of deferred financing cost amortization (in thousands): 2018 3,706 2019 4,914 2020 48,259 Total debt, including current maturities $ 56,879 |
Fair Value Disclosures
Fair Value Disclosures | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | Note 7 – Fair Value Disclosures The Company uses the following methods and assumptions to estimate the fair value of financial instruments: • Cash and Cash Equivalents • Restricted Cash • Accounts Receivable • Accounts Payable, Including Income Taxes Payable and Accrued Expenses • Long-Term Debt The Company’s non-financial The earn-out earn-out The contingent consideration for Cyphre is measured at fair value, based on level 3 inputs, with any change to fair value recorded in the Condensed Consolidated Statements of Comprehensive Loss in each reporting period. As of March 31, 2018, the fair value of the contingent consideration was $3.9 million. During the three months ended March 31, 2018, RigNet recognized accreted interest expense on the Cyphre contingent consideration of $0.1 million with corresponding increases to other liabilities. The earn-out earn-out earn-out |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8 – Income Taxes The Company’s effective income tax rate was (12.2%) and (26.3%) for the three months ended March 31, 2018 and 2017, respectively. The Company’s effective tax rate is affected by factors including changes in valuation allowances, fluctuations in income across jurisdictions with varying tax rates, and changes in income tax reserves, including related penalties and interest. The Company has computed the provision for taxes for the current and comparative periods using the actual year-to-date The Company believes that it is reasonably possible that a decrease of up to $3.5 million in unrecognized tax benefits, including related interest and penalties, may be necessary within the coming year due to lapse in statute of limitations. On December 22, 2017 the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (The Act), making broad and complex changes to the U.S. tax code. The SEC staff issued SAB 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act. For various reasons that are discussed below, the Company has not completed its accounting for the income tax effects of certain elements of the Tax Act. If the Company was able to make reasonable estimates of the effects of elements for which its analysis is not yet complete, the Company recorded provisional adjustments. If the Company was not yet able to make reasonable estimates of the impact of certain elements, the Company has not recorded any adjustments related to those elements and has continued accounting for them in accordance with ASC 740 on the basis of the tax laws in effect before the Tax Act. The Company has not yet completed the accounting for the income tax effects of the Tax Act and all the amounts recorded remain provisional. As noted in the Company’s 2017 Annual report on form 10-K Reduction of US Federal Corporate Tax Rate: Deemed Repatriation Transition Tax: 2018-26, Global Intangible Low Taxed Income (GILTI): The Company is continuing to evaluate all of the provisions of U.S. Tax Reform and expects to finalize its assessment during the one-year |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Note 9 – Stock-Based Compensation During the three months ended March 31, 2018, the Company granted a total of 306,173 restricted stock units (RSUs) to certain directors, officers and employees of the Company under the 2010 Omnibus Incentive Plan (2010 Plan). Of these, the Company granted (i) 135,753 RSUs to certain officers and employees that generally vest over a four year period of continued employment, with 25% of the RSUs vesting on each of the first four anniversaries of the grant date, (ii) 11,188 RSUs to certain officers and employees that generally vest over a two year period of continued employment, with 50% of the RSUs vesting on each of the first two anniversaries of the grant date, (iii) 1,790 RSUs issued to a director that vest in January 2019 and (iv) 157,442 RSUs to certain officers and employees that vest immediately. The fair value of restricted stock units is determined based on the closing trading price of the Company’s common stock on the grant date of the award. Compensation expense is recognized on a straight-line basis over the requisite service period of the entire award. During the three months ended March 31, 2018, 12,362 RSUs and 20,701 stock options were forfeited. Stock-based compensation expense related to the Company’s stock-based compensation plans for the three months ended March 31, 2018 and 2017 was $2.4 million and $0.8 million, respectively. As of March 31, 2018, there was $3.5 million of total unrecognized compensation cost related to unvested options and restricted stock expected to vest. This cost is expected to be recognized over a remaining weighted-average period of 2.4 years. |
Earnings (loss) per Share
Earnings (loss) per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings (loss) per Share | Note 10 – Earnings (loss) per Share Basic earnings (loss) per share (EPS) are computed by dividing loss attributable to RigNet common stockholders by the number of basic shares outstanding. Basic shares equal the total of the common shares outstanding, weighted for the average days outstanding for the period. Basic shares exclude the dilutive effect of common shares that could potentially be issued due to the exercise of stock options or vesting of restricted stock and RSUs. Diluted EPS is computed by dividing loss attributable to RigNet common stockholders by the number of diluted shares outstanding. Diluted shares equal the total of the basic shares outstanding and all potentially issuable shares, other than antidilutive shares, if any, weighted for the average days outstanding for the period. The Company uses the treasury stock method to determine the dilutive effect. In periods when a net loss is reported, all common stock equivalents are excluded from the calculation because they would have an anti-dilutive effect, meaning the loss per share would be reduced. Therefore, in periods when a loss is reported, basic and dilutive loss per share are the same. For the three months ended March 31, 2018, there were approximately 671,627 potentially issuable shares excluded from the Company’s calculation of diluted EPS that were excluded because the Company incurred a loss in the period and to include them would have been anti-dilutive. For the three months ended March 31, 2017, there were approximately 697,281 potentially issuable shares excluded from the Company’s calculation of diluted EPS that were excluded because the Company incurred a loss in the period and to include them would have been anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11 – Commitments and Contingencies Legal Proceedings In August 2017, the Company filed litigation in Harris County District Court and arbitration against one of its former Chief Executive Officers for, among other things, breach of fiduciary duty, misappropriation of trade secrets, unfair competition and breach of contract. Recently, that former executive filed counterclaims against us and one of the Company’s independent directors. The Company is seeking repayment of certain severance benefits and injunctive relief. The Company has incurred legal expense of approximately $0.2 million in connection with this dispute for the three months ended March 31, 2018. The Company may continue to incur significant legal fees, related expenses and management time in the future. The Company cannot predict the ultimate outcome of this dispute, the total costs to be incurred or the potential impact on personnel. Based on the information available at this time and management’s understanding of the dispute, the Company does not deem the likelihood of a material loss related to this dispute to be probable, so it has not accrued any liability related to the dispute. At this stage of the arbitration and litigation, the range of possible loss is not reasonably estimable. Global Xpress (GX) Dispute Inmarsat plc (Inmarsat), a satellite telecommunications company, and the Company are in a dispute relating to a January 2014 agreement regarding the purchase by the Company of up to $65.0 million, under certain conditions, of GX capacity from Inmarsat over several years (GX dispute). The parties are attempting to resolve the GX dispute through a contractually-stipulated arbitration process that began in October 2016. The parties dispute whether Inmarsat has met its contractual obligations with respect to the service under the agreement. In July 2017, pursuant to its contractual rights under the agreement, the Company delivered a notice of termination of the agreement to Inmarsat. In addition, the Company has filed certain counterclaims against Inmarsat. The Company has incurred legal expenses of $0.6 million in connection with the GX dispute for the three months ended March 31, 2018. The Company may continue to incur significant legal fees, related expenses and management time in the future. The Company cannot predict the ultimate outcome of the GX dispute, the total costs to be incurred or the potential impact on personnel. Based on the information available at this time and management’s understanding of the GX dispute, the Company does not deem the likelihood of a material loss related to this dispute to be probable, so it has not accrued any liability related to the dispute. At this stage of the arbitration, the range of possible loss is not reasonably estimable, but could range from zero to the maximum amount payable under the contract for the services plus expenses. Other Litigation The Company, in the ordinary course of business, is a claimant or a defendant in various legal proceedings, including proceedings as to which the Company has insurance coverage and those that may involve the filing of liens against the Company or its assets. Operating Leases The Company leases office space under lease agreements expiring on various dates through 2025. For the three months ended March 31, 2018 and 2017, the Company recognized expense under operating leases of $0.7 million and $1.1 million, respectively. As of March 31, 2018, future minimum lease obligations for the remainder of 2018 and future years were as follows (in thousands): 2018 2,059 2019 1,793 2020 902 2021 654 2022 668 Thereafter 1,820 $ 7,896 Commercial Commitments The Company enters into contracts for satellite bandwidth and other network services with certain providers. As of March 31, 2018, the Company had the following commercial commitments related to satellite and network services for the remainder of 2018 and the future years thereafter (in thousands): 2018 17,121 2019 8,337 2020 293 2021 85 $ 25,836 The Company is no longer reporting $65.0 million in the above table for capacity from Inmarsat’s GX network. Please see paragraph “Global Xpress (GX) Dispute” above for details of the ongoing arbitration and the Company’s notice to terminate the contract with Inmarsat. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Note 12 – Segment Information Segment information is prepared consistent with the components of the enterprise for which separate financial information is available and regularly evaluated by the chief operating decision-maker for the purpose of allocating resources and assessing performance. The Company previously operated under two reportable segments: Managed Services and Systems Integration (previously called SI&A). During the third quarter of 2017, after the Company completed the ESS acquisition, the Company reorganized its business and reportable segments. Applications and Internet-of-Things RigNet considers its business to consist of the following segments: • Managed Services. • Applications and Internet-of-Things & IoT). over-the-top • Systems Integration. Corporate and eliminations primarily represents unallocated executive and support activities, interest expense, income taxes and eliminations. The Company’s business segment information as of and for the three months ended March 31, 2018 and 2017, is presented below. Three Months Ended March 31, 2018 Managed Applications and Internet-of- Things Systems Corporate and Consolidated (in thousands) Revenue $ 42,050 $ 5,336 $ 6,447 $ — $ 53,833 Cost of revenue (excluding depreciation and amortization) 25,745 3,085 4,851 — 33,681 Depreciation and amortization 5,726 847 652 762 7,987 Selling, general and administrative 4,215 354 323 11,743 16,635 Operating income (loss) $ 6,364 $ 1,050 $ 621 $ (12,505 ) $ (4,470 ) Total assets 148,535 49,758 16,535 30,431 245,259 Capital expenditures 5,834 134 — 645 6,613 Three Months Ended March 31, 2017 Managed Applications and Internet-of- Things Systems Corporate and Consolidated (in thousands) Revenue $ 41,663 $ 2,431 $ 3,978 $ — $ 48,072 Cost of revenue (excluding depreciation and amortization) 25,347 1,455 3,073 — 29,875 Depreciation and amortization 6,023 7 587 699 7,316 Selling, general and administrative 4,439 488 470 6,551 11,948 Operating income (loss) $ 5,854 $ 481 $ (152 ) $ (7,250 ) $ (1,067 ) Total assets 205,607 667 16,571 1,888 224,733 Capital expenditures 3,160 — — — 3,160 The following table presents revenue earned from the Company’s domestic and international operations for the three months ended March 31, 2018 and 2017. Revenue is based on the location where services are provided or goods are sold. Due to the mobile nature of RigNet’s customer base and the services provided, the Company works closely with its customers to ensure rig or vessel moves are closely monitored to ensure location of service information is properly reflected. Three Months Ended March 31, 2018 2017 (in thousands) Domestic $ 17,628 $ 14,952 International 36,205 33,120 Total $ 53,833 $ 48,072 The following table presents goodwill and long-lived assets, net of accumulated depreciation, for the Company’s domestic and international operations as of March 31, 2018 and December 31, 2017. March 31, December 31, 2018 2017 (in thousands) Domestic $ 68,909 $ 68,942 International 80,283 58,895 Total $ 149,192 $ 127,837 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Revenue Recognition | Revenue Recognition - Revenue from Contracts with Customers Revenue is recognized to depict the transfer of promised goods or services in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Revenue Recognition - Managed Services and Applications and Internet-of-Things Managed Services and Applications and Internet-of-Things customers are primarily served under fixed-price contracts, either on a monthly or day rate basis or for equipment sales. Our contracts are generally in the form of Master Service Agreements, or MSAs, with specific services being provided under individual service orders that have a term of one to three years with renewal options, while land-based locations are generally shorter term or terminable on short notice without a penalty. Service orders are executed under the MSA for individual remote sites or groups of sites, and generally permit early termination on short notice without penalty in the event of force majeure, breach of the MSA or cold stacking of a drilling rig (when a rig is taken out of service and is expected to be idle for a protracted period of time). Performance Obligations Satisfied Over Time Performance Obligations Satisfied at a Point in Time Revenue Recognition – Systems Integration Revenues related to long-term, fixed-price Systems Integration contracts for customized network solutions are recognized based on the percentage of completion for the contract. At any point, RigNet has numerous contracts in progress, all of which are at various stages of completion. Accounting for revenues and profits on long-term contracts requires estimates of total estimated contract costs and estimates of progress toward completion to determine the extent of revenue and profit recognition. Performance Obligations Satisfied Over Time — The delivery of a Systems Integration solution represents the single performance obligation under Systems Integration contracts. Progress towards completion on fixed price contracts is measured based on the ratio of costs incurred to total estimated contract costs (the cost-to-cost method). These estimates may be revised as additional information becomes available or as specific project circumstances change. The Company reviews all material contracts on a monthly basis and revises the estimates as appropriate for developments such as, providing services, purchasing third-party materials and equipment at costs differing from those previously estimated, and incurring or expecting to incur schedule issues. Changes in estimated final contract revenues and costs can either increase or decrease the final estimated contract profit or loss. Profits are recorded in the period in which a change in estimate is recognized, based on progress achieved through the period of change. Anticipated losses on contracts are recorded in full in the period in which they become evident. Revenue recognized in excess of amounts billed is classified as a current asset under costs and estimated earnings in excess of billings on uncompleted contracts. Systems Integration contracts are billed in accordance with the terms of the contract which are typically either based on milestones or specified time intervals. As of March 31, 2018 and December 31, 2017, the amount of costs and estimated earnings in excess of billings on uncompleted contracts related to Systems Integration projects was $1.9 million and $2.4 million, respectively. Under long-term contracts, amounts recorded in costs and estimated earnings in excess of billings on uncompleted contracts may not be realized or paid, respectively, within a one-year period. As of March 31, 2018 and December 31, 2017, $0.8 million and $0.4 million, respectively, of amounts billed to customers in excess of revenue recognized to date are classified as a current liability, under deferred revenue. All of the billings in excess of costs as of December 31, 2017 were recognized as revenue during the three months ended March 31, 2018. The Company records revenue on contracts relating to certain probable claims and unapproved change orders by including in revenue an amount less than or equal to the amount of costs incurred to date relating to these probable claims and unapproved change orders, thus recognizing no profit until such time as claims are finalized or change orders are approved. The amount of unapproved change orders and claim revenues is included in the Company’s Consolidated Balance Sheets as part of costs and estimated earnings in excess of billings on uncompleted contracts. No material unapproved change orders and claims revenue were included in costs and estimated earnings in excess of billings on uncompleted contracts as of March 31, 2018 and December 31, 2017. As new facts become known, an adjustment to the estimated recovery is made and reflected in the current period. Backlog - As of March 31, 2018, we have backlog for our Systems Integration projects of $23.5 million, which will be recognized over the remaining contract term for each contract. Systems Integration contract terms are typically one to three years. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 2014-09), No. 2015-14 2015-14), No. 2016-08 2016-08), No. 2016-10 2016-10) No. 2016-12 2016-12), In February 2016, the FASB issued Accounting Standards Update No. 2016-02 2016-02), In August 2016, the FASB issued Accounting Standards Update No. 2016-15 2016-15), In October 2016, the FASB issued Accounting Standards Update No. 2016-16 2016-16), In November 2016, the FASB issued Accounting Standards Update No. 2016-18 2016-18), |
Business Combinations (Tables)
Business Combinations (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Summary of Allocation of Purchase Price | The acquisition of Intelie, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Life (Years) Fair Market Values (in thousands) Current assets $ 589 Property and equipment 73 Trade name 7 2,300 Technology 7 8,400 Customer relationships 7 320 Total identifiable intangible assets 11,020 Goodwill 10,744 Current liabilities (460 ) Deferred tax liability (3,825 ) Total purchase price $ 18,141 (a) (a) Includes $7.6 million in contingent consideration earn-out |
Supplemental Pro Forma Information | The following table represents supplemental pro forma information as if the Intelie acquisition had occurred on January 1, 2017. Three Months Ended March 31, Three Months Ended March 31, 2018 2017 (in thousands, except per share amounts) Revenue $ 54,512 $ 48,395 Expenses 59,942 50,477 Net loss $ (5,430 ) $ (2,082 ) Net loss attributable to RigNet, Inc. common stockholders $ (5,460 ) $ (2,121 ) Net loss per share attributable to RigNet, Inc. common stockholders: Basic $ (0.30 ) $ (0.12 ) Diluted $ (0.30 ) $ (0.12 ) |
Energy Satellite Services [Member] | |
Summary of Allocation of Purchase Price | The acquisition of ESS, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Estimated Useful Life (Years) Fair Market Values (in thousands) Accounts receivable $ 392 Property and equipment 1,000 Covenant not to compete 5 3,040 Customer relationships 7 9,870 Total identifiable intangible assets 12,910 Goodwill 8,465 Accounts payable (567 ) Total purchase price $ 22,200 |
Data Technology Solutions [Member] | |
Summary of Allocation of Purchase Price | The acquisition of DTS, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Managed Services segment. Fair Market Values (in thousands) Property and equipment $ 4,553 Goodwill 704 Accounts payable (152 ) Total purchase price $ 5,105 |
Cyphre Security Solutions [Member] | |
Summary of Allocation of Purchase Price | The acquisition of Cyphre, including goodwill, is included in the Company’s condensed consolidated financial statements as of the acquisition date and is reflected in the Applications and Internet-of-Things Weighted Average Estimated Useful Life (Years) Fair Market Values (in thousands) Property and equipment $ 18 Trade name 7 1,590 Technology 7 5,571 Customer relationships 7 332 Total identifiable intangible assets 7,493 Goodwill 4,591 Accrued expenses (100 ) Total purchase price $ 12,002 (a) (a) Includes $3.8 million in contingent consideration estimated as of the date of acquisition. |
Supplemental Pro Forma Information | The following table represents supplemental pro forma information as if the 2017 acquisitions had occurred on January 1, 2017. Three Months Ended March 31, 2017 (in thousands, except per Revenue $ 52,915 Expenses 53,283 Net loss $ (368 ) Net loss attributable to RigNet, Inc. common stockholders $ (407 ) Net loss per share attributable to RigNet, Inc. common stockholders: Basic $ (0.02 ) Diluted $ (0.02 ) |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Amortization Expense for Intangibles | The following table sets forth expected amortization expense of intangibles for the remainder of 2018 and the following years (in thousands): 2018 6,406 2019 7,508 2020 6,478 2021 6,104 2022 5,767 Thereafter 7,511 $ 39,774 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Credit Facilities and Long-Term Debt Arrangements | As of March 31, 2018 and December 31, 2017, the following credit facilities and long-term debt arrangements with financial institutions were in place: March 31, December 31, 2018 2017 (in thousands) Term loan, net of unamortized deferred financing costs $ 13,300 $ 14,503 Revolving loan 43,400 43,400 Capital lease 179 211 56,879 58,114 Less: Current maturities of long-term debt (4,818 ) (4,814 ) Current maturities of capital lease (127 ) (127 ) $ 51,934 $ 53,173 |
Aggregate Principal Maturities of Long-Term Debt | The following table sets forth the aggregate principal maturities of long-term debt, net of deferred financing cost amortization (in thousands): 2018 3,706 2019 4,914 2020 48,259 Total debt, including current maturities $ 56,879 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Lease Obligations | As of March 31, 2018, future minimum lease obligations for the remainder of 2018 and future years were as follows (in thousands): 2018 2,059 2019 1,793 2020 902 2021 654 2022 668 Thereafter 1,820 $ 7,896 |
Commercial Commitments Related to Satellite and Network Services | As of March 31, 2018, the Company had the following commercial commitments related to satellite and network services for the remainder of 2018 and the future years thereafter (in thousands): 2018 17,121 2019 8,337 2020 293 2021 85 $ 25,836 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Company's Business Segment Information | The Company’s business segment information as of and for the three months ended March 31, 2018 and 2017, is presented below. Three Months Ended March 31, 2018 Managed Applications and Internet-of- Things Systems Corporate and Consolidated (in thousands) Revenue $ 42,050 $ 5,336 $ 6,447 $ — $ 53,833 Cost of revenue (excluding depreciation and amortization) 25,745 3,085 4,851 — 33,681 Depreciation and amortization 5,726 847 652 762 7,987 Selling, general and administrative 4,215 354 323 11,743 16,635 Operating income (loss) $ 6,364 $ 1,050 $ 621 $ (12,505 ) $ (4,470 ) Total assets 148,535 49,758 16,535 30,431 245,259 Capital expenditures 5,834 134 — 645 6,613 Three Months Ended March 31, 2017 Managed Applications and Internet-of- Things Systems Corporate and Consolidated (in thousands) Revenue $ 41,663 $ 2,431 $ 3,978 $ — $ 48,072 Cost of revenue (excluding depreciation and amortization) 25,347 1,455 3,073 — 29,875 Depreciation and amortization 6,023 7 587 699 7,316 Selling, general and administrative 4,439 488 470 6,551 11,948 Operating income (loss) $ 5,854 $ 481 $ (152 ) $ (7,250 ) $ (1,067 ) Total assets 205,607 667 16,571 1,888 224,733 Capital expenditures 3,160 — — — 3,160 |
Revenue Earned from Domestic and International Operations | The following table presents revenue earned from the Company’s domestic and international operations for the three months ended March 31, 2018 and 2017. Revenue is based on the location where services are provided or goods are sold. Due to the mobile nature of RigNet’s customer base and the services provided, the Company works closely with its customers to ensure rig or vessel moves are closely monitored to ensure location of service information is properly reflected. Three Months Ended March 31, 2018 2017 (in thousands) Domestic $ 17,628 $ 14,952 International 36,205 33,120 Total $ 53,833 $ 48,072 |
Long - Lived Assets, Net of Accumulated Depreciation for Both Domestic and International Operations | The following table presents goodwill and long-lived assets, net of accumulated depreciation, for the Company’s domestic and international operations as of March 31, 2018 and December 31, 2017. March 31, December 31, 2018 2017 (in thousands) Domestic $ 68,909 $ 68,942 International 80,283 58,895 Total $ 149,192 $ 127,837 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2018 |
Summary Of Significant Accounting Policies [Line Items] | |||
Revenue recognized from customers | $ 800 | $ 400 | |
Cumulative effect of accumulated deficit | (338) | $ (338) | |
Systems Integration Projects [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Costs and estimated earnings | $ 1,900 | $ 2,400 | 1,900 |
Backlog from revenue contract | $ 23,500 | ||
Systems Integration Projects [Member] | Minimum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Remaining contract term | 1 year | ||
Systems Integration Projects [Member] | Maximum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Remaining contract term | 3 years |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) $ in Thousands, R$ in Millions | Apr. 18, 2018USD ($) | Mar. 23, 2018USD ($) | Mar. 23, 2018BRL (R$) | Jul. 28, 2017USD ($) | Jul. 24, 2017USD ($) | May 18, 2017USD ($) | May 31, 2017USD ($) | Mar. 31, 2018USD ($) |
Business Acquisition [Line Items] | ||||||||
Amount paid for acquisition | $ 3,202 | |||||||
Data Technology Solutions [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Aggregate purchase price | $ 5,105 | |||||||
Amount paid for acquisition | 5,100 | |||||||
Goodwill acquired during period | $ 700 | |||||||
Cyphre Security Solutions [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Aggregate purchase price | $ 12,002 | |||||||
Amount paid for acquisition | $ 4,900 | |||||||
Stock issued for acquisition | 3,300 | |||||||
Contingent consideration earn-out, estimated payment | 3,800 | $ 3,800 | 3,900 | |||||
Goodwill acquired during period | $ 4,600 | |||||||
Revenue | 2,900 | |||||||
Net income (loss) | 1,900 | |||||||
Cyphre Security Solutions [Member] | Interest Expense [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Accreted interest expense on earn-out liability | 100 | |||||||
Energy Satellite Services [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Aggregate purchase price | $ 22,200 | |||||||
Amount paid for acquisition | 22,200 | |||||||
Goodwill acquired during period | $ 8,500 | |||||||
Intelie Solucoes Em Informatica S A [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Aggregate purchase price | $ 18,141 | |||||||
Amount paid for acquisition | 3,200 | R$ 10.6 | ||||||
Stock issued for acquisition | 7,300 | |||||||
Contingent consideration earn-out, estimated payment | 7,600 | 7,600 | ||||||
Estimate maximum earnout payable | 17,000 | |||||||
Goodwill acquired during period | $ 10,700 | |||||||
Revenue | 100 | |||||||
Net income (loss) | 100 | |||||||
Intelie Solucoes Em Informatica S A [Member] | General and Administrative Expenses [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Acquisition related costs | $ 800 | |||||||
Auto-Comm and SAFCON [Member] | Subsequent Event [Member] | ||||||||
Business Acquisition [Line Items] | ||||||||
Aggregate purchase price | $ 6,300 | |||||||
Amount paid for acquisition | 2,200 | |||||||
Stock issued for acquisition | $ 4,100 |
Business Combinations - Summary
Business Combinations - Summary of Allocation of Purchase Price (Detail) - USD ($) $ in Thousands | Mar. 23, 2018 | Jul. 28, 2017 | May 18, 2017 | Mar. 31, 2018 | Dec. 31, 2017 | Jul. 24, 2017 |
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 48,465 | $ 37,088 | ||||
Cyphre Security Solutions [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Property and equipment | $ 18 | |||||
Identifiable intangible assets | 7,493 | |||||
Goodwill | 4,591 | |||||
Total purchase price | 12,002 | |||||
Accrued expenses | $ (100) | |||||
Cyphre Security Solutions [Member] | Customer Relationships [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 332 | |||||
Cyphre Security Solutions [Member] | Brand Name [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 1,590 | |||||
Cyphre Security Solutions [Member] | Technology [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 5,571 | |||||
Energy Satellite Services [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Property and equipment | $ 1,000 | |||||
Identifiable intangible assets | 12,910 | |||||
Goodwill | 8,465 | |||||
Total purchase price | 22,200 | |||||
Accounts receivable | 392 | |||||
Accounts payable | $ (567) | |||||
Energy Satellite Services [Member] | Customer Relationships [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 9,870 | |||||
Energy Satellite Services [Member] | Covenant Not to Compete [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 5 years | |||||
Identifiable intangible assets | $ 3,040 | |||||
Data Technology Solutions [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Property and equipment | $ 4,553 | |||||
Goodwill | 704 | |||||
Total purchase price | 5,105 | |||||
Accounts payable | $ (152) | |||||
Intelie Solucoes Em Informatica S A [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Current assets | $ 589 | |||||
Property and equipment | 73 | |||||
Identifiable intangible assets | 11,020 | |||||
Goodwill | 10,744 | |||||
Current liabilities | (460) | |||||
Deferred tax liability | (3,825) | |||||
Total purchase price | $ 18,141 | |||||
Intelie Solucoes Em Informatica S A [Member] | Customer Relationships [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 320 | |||||
Intelie Solucoes Em Informatica S A [Member] | Brand Name [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 2,300 | |||||
Intelie Solucoes Em Informatica S A [Member] | Technology [Member] | ||||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||||
Weighted Average Estimated Useful Life | 7 years | |||||
Identifiable intangible assets | $ 8,400 |
Business Combinations - Summa29
Business Combinations - Summary of Allocation of Purchase Price (Parenthetical) (Detail) - USD ($) $ in Millions | Mar. 31, 2018 | Mar. 23, 2018 | May 31, 2017 | May 18, 2017 |
Cyphre Security Solutions [Member] | ||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||
Contingent consideration earn-out, estimated payment | $ 3.9 | $ 3.8 | $ 3.8 | |
Intelie Solucoes Em Informatica S A [Member] | ||||
Acquired Finite Lived Intangible Assets [Line Items] | ||||
Contingent consideration earn-out, estimated payment | $ 7.6 | $ 7.6 |
Business Combinations - Supplem
Business Combinations - Supplemental Pro Forma Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Intelie Solucoes Em Informatica S A [Member] | ||
Business Acquisition [Line Items] | ||
Revenue | $ 54,512 | $ 48,395 |
Expenses | 59,942 | 50,477 |
Net loss | (5,430) | (2,082) |
Net loss attributable to RigNet, Inc. common stockholders | $ (5,460) | $ (2,121) |
Net loss per share attributable to RigNet, Inc. common stockholders: | ||
Basic | $ (0.30) | $ (0.12) |
Diluted | $ (0.30) | $ (0.12) |
Cyphre Security Solutions [Member] | ||
Business Acquisition [Line Items] | ||
Revenue | $ 52,915 | |
Expenses | 53,283 | |
Net loss | (368) | |
Net loss attributable to RigNet, Inc. common stockholders | $ (407) | |
Net loss per share attributable to RigNet, Inc. common stockholders: | ||
Basic | $ (0.02) | |
Diluted | $ (0.02) |
Goodwill and Intangibles - Addi
Goodwill and Intangibles - Additional Information (Detail) - USD ($) | Mar. 31, 2018 | Mar. 23, 2018 | Dec. 31, 2017 | Nov. 30, 2017 | Jul. 28, 2017 | Jul. 24, 2017 | May 18, 2017 | Jul. 31, 2017 | Mar. 31, 2018 | Mar. 31, 2017 |
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Impairment of goodwill | $ 0 | $ 0 | ||||||||
Goodwill | $ 48,465,000 | $ 37,088,000 | $ 48,465,000 | |||||||
Intangibles, net | 39,774,000 | 30,405,000 | 39,774,000 | |||||||
Amortization expense | $ 2,100,000 | $ 1,300,000 | ||||||||
Minimum [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Intangible assets useful life | 5 years | |||||||||
Maximum [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Intangible assets useful life | 7 years | |||||||||
Cyphre Security Solutions [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Goodwill acquired during period | $ 4,600,000 | |||||||||
Goodwill | $ 4,591,000 | |||||||||
Energy Satellite Services [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Goodwill acquired during period | $ 8,500,000 | |||||||||
Goodwill | $ 8,465,000 | |||||||||
Data Technology Solutions [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Goodwill acquired during period | $ 700,000 | |||||||||
Goodwill | $ 704,000 | |||||||||
Intelie Solucoes Em Informatica S A [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Goodwill acquired during period | $ 10,700,000 | |||||||||
Goodwill | $ 10,744,000 | |||||||||
Licenses [Member] | ||||||||||
Goodwill And Intangible Assets Impairment [Line Items] | ||||||||||
Impairment of intangibles | $ 0 | $ 0 |
Goodwill and Intangibles - Amor
Goodwill and Intangibles - Amortization Expense for Intangibles (Detail) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,018 | $ 6,406 | |
2,019 | 7,508 | |
2,020 | 6,478 | |
2,021 | 6,104 | |
2,022 | 5,767 | |
Thereafter | 7,511 | |
Total amortization expense of intangibles | $ 39,774 | $ 30,405 |
Restricted Cash - Additional In
Restricted Cash - Additional Information (Detail) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Cash and Cash Equivalents [Abstract] | ||
Restricted cash, current | $ 45 | $ 43 |
Long-Term Debt - Credit Facilit
Long-Term Debt - Credit Facilities and Long-Term Debt Arrangements (Detail) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Long-Term Debt | ||
Term loan, net of unamortized deferred financing costs | $ 13,300 | $ 14,503 |
Revolving loan | 43,400 | 43,400 |
Capital lease | 179 | 211 |
Total debt, including current maturities | 56,879 | 58,114 |
Total debt, including current maturities | 56,879 | 58,114 |
Less: Current maturities of long-term debt | (4,818) | (4,814) |
Current maturities of capital lease | (127) | (127) |
Long-term debt, non-current portion | $ 51,934 | $ 53,173 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) | Nov. 06, 2017USD ($)Institution | Mar. 31, 2018USD ($) | Mar. 31, 2017 | Dec. 31, 2017USD ($) | Jun. 30, 2016USD ($) |
Debt Instrument [Line Items] | |||||
Line of credit outstanding amount | $ 43,400,000 | $ 43,400,000 | |||
Term Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit outstanding amount | $ 13,800,000 | ||||
Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Number of participating financial institutions | Institution | 4 | ||||
Revolving credit facility | $ 85,000,000 | ||||
Maturity of Term Loan / Maturity date | Nov. 6, 2020 | ||||
Debt Instrument, Description of Variable Rate Basis | LIBOR | ||||
Quarterly principal installments of Term Loan | $ 1,250,000 | ||||
Weighted average interest rate | 4.20% | 3.00% | |||
Interest rate | 4.60% | ||||
Funded debt to Adjusted EBITDA ratio | 2.75% | ||||
Fixed charge coverage ratio | 1.25% | ||||
Credit Agreement [Member] | Term Loan [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit outstanding amount | 15,000,000 | ||||
Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Line of credit outstanding amount | $ 43,400,000 | ||||
Performance Bond and Letter of Credit [Member] | |||||
Debt Instrument [Line Items] | |||||
Standby letters of credit issued amount | $ 600,000 | ||||
Performance bond facility | $ 1,500,000 | ||||
Maturity date of performance bond facility | Jun. 30, 2021 | ||||
Maximum [Member] | Revolving Credit Facility [Member] | Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Sublimit for issuance of standby letters of credit | 25,000,000 | ||||
Maximum [Member] | Performance Bond and Letter of Credit [Member] | |||||
Debt Instrument [Line Items] | |||||
Sublimit for issuance of standby letters of credit | $ 25,000,000 | ||||
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
LIBOR plus a margin ranging | 1.75% | ||||
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
LIBOR plus a margin ranging | 2.75% |
Long-Term Debt - Aggregate Prin
Long-Term Debt - Aggregate Principal Maturities of Long-Term Debt (Detail) $ in Thousands | Mar. 31, 2018USD ($) |
Debt Disclosure [Abstract] | |
2,018 | $ 3,706 |
2,019 | 4,914 |
2,020 | 48,259 |
Total debt, including current maturities | $ 56,879 |
Fair Value Disclosure - Additio
Fair Value Disclosure - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||||
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 23, 2018 | May 31, 2017 | May 18, 2017 | |
Cyphre Security Solutions [Member] | |||||
Fair Value Inputs Assets Liabilities Quantitative Information [Line Items] | |||||
Contingent consideration earn-out, estimated payment | $ 3.9 | $ 3.8 | $ 3.8 | ||
Cyphre Security Solutions [Member] | Interest Expense [Member] | |||||
Fair Value Inputs Assets Liabilities Quantitative Information [Line Items] | |||||
Accreted interest expense on earn-out liability | 0.1 | ||||
Tecnor [Member] | |||||
Fair Value Inputs Assets Liabilities Quantitative Information [Line Items] | |||||
Contingent consideration earn-out, estimated payment | 6 | ||||
Tecnor [Member] | Interest Expense [Member] | |||||
Fair Value Inputs Assets Liabilities Quantitative Information [Line Items] | |||||
Accreted interest expense on earn-out liability | 0.1 | $ 0.1 | |||
Intelie Solucoes Em Informatica S A [Member] | |||||
Fair Value Inputs Assets Liabilities Quantitative Information [Line Items] | |||||
Contingent consideration earn-out, estimated payment | $ 7.6 | $ 7.6 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Effective income tax rate | 12.20% | 26.30% | |
Reductions related to lapses in statue of limitations | $ 3.5 | ||
Decrease in provisional deferred tax expense | $ 3.8 | $ 8.2 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock options forfeited | 20,701 | |
Stock-based compensation | $ 2,445 | $ 826 |
Total unrecognized compensation cost | $ 3,500 | |
Weighted-average period | 2 years 4 months 24 days | |
Restricted Stock Units (RSUs) [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares forfeited | 12,362 | |
2010 Omnibus Incentive Plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Restricted common stock granted, net of share repurchase from employees and share cancellations, shares | 306,173 | |
2010 Omnibus Incentive Plan [Member] | Officers and Employees [Member] | Vest Over a Four Year Period of Continued Employment [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Issuance of restricted common stock, net of share repurchase from employees and share cancellations, shares | 135,753 | |
Vesting period for restricted stock | 4 years | |
Vesting percentage for restricted shares issued to officers and employees | 25.00% | |
2010 Omnibus Incentive Plan [Member] | Officers and Employees [Member] | Vest Over a Two Year Period of Continued Employment [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Issuance of restricted common stock, net of share repurchase from employees and share cancellations, shares | 11,188 | |
Vesting period for restricted stock | 2 years | |
Vesting percentage for restricted shares issued to officers and employees | 50.00% | |
2010 Omnibus Incentive Plan [Member] | Officers and Employees [Member] | Vest Immediately [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Issuance of restricted common stock, net of share repurchase from employees and share cancellations, shares | 157,442 | |
2010 Omnibus Incentive Plan [Member] | Directors [Member] | Vest in January 2019 [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Issuance of restricted common stock, net of share repurchase from employees and share cancellations, shares | 1,790 |
Earnings (loss) per Share - Add
Earnings (loss) per Share - Additional Information (Detail) - shares | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings Per Share [Abstract] | ||
Potentially issuable shares excluded from calculation of diluted EPS | 671,627 | 697,281 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Commitments And Contingencies [Line Items] | ||
Legal expense | $ 0.2 | |
Recognized expense under operating leases | 0.7 | $ 1.1 |
GX Dispute [Member] | ||
Commitments And Contingencies [Line Items] | ||
Legal expense | 0.6 | |
Long term purchase commitment amount, maximum | $ 65 |
Commitments and Contingencies42
Commitments and Contingencies - Future Minimum Lease Obligations (Detail) $ in Thousands | Mar. 31, 2018USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
2,018 | $ 2,059 |
2,019 | 1,793 |
2,020 | 902 |
2,021 | 654 |
2,022 | 668 |
Thereafter | 1,820 |
Total | $ 7,896 |
Commitments and Contingencies43
Commitments and Contingencies - Commercial Commitments Related to Satellite and Network Services (Detail) $ in Thousands | Mar. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,018 | $ 17,121 |
2,019 | 8,337 |
2,020 | 293 |
2,021 | 85 |
Other Commitment, Total | $ 25,836 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Information - Company's
Segment Information - Company's Business Segment Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||
Revenue | $ 53,833 | $ 48,072 | |
Cost of revenue (excluding depreciation and amortization) | 33,681 | 29,875 | |
Depreciation and amortization | 7,987 | 7,316 | |
Selling, general and administrative | 16,635 | 11,948 | |
Operating income (loss) | (4,470) | (1,067) | |
Total assets | 245,259 | 224,733 | $ 230,094 |
Capital expenditures | 6,613 | 3,160 | |
Reportable Segments [Member] | Managed Services [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue | 42,050 | 41,663 | |
Cost of revenue (excluding depreciation and amortization) | 25,745 | 25,347 | |
Depreciation and amortization | 5,726 | 6,023 | |
Selling, general and administrative | 4,215 | 4,439 | |
Operating income (loss) | 6,364 | 5,854 | |
Total assets | 148,535 | 205,607 | |
Capital expenditures | 5,834 | 3,160 | |
Reportable Segments [Member] | Applications and Internet-of-Things [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue | 5,336 | 2,431 | |
Cost of revenue (excluding depreciation and amortization) | 3,085 | 1,455 | |
Depreciation and amortization | 847 | 7 | |
Selling, general and administrative | 354 | 488 | |
Operating income (loss) | 1,050 | 481 | |
Total assets | 49,758 | 667 | |
Capital expenditures | 134 | ||
Reportable Segments [Member] | Systems Integration [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenue | 6,447 | 3,978 | |
Cost of revenue (excluding depreciation and amortization) | 4,851 | 3,073 | |
Depreciation and amortization | 652 | 587 | |
Selling, general and administrative | 323 | 470 | |
Operating income (loss) | 621 | (152) | |
Total assets | 16,535 | 16,571 | |
Corporate and Eliminations [Member] | |||
Segment Reporting Information [Line Items] | |||
Depreciation and amortization | 762 | 699 | |
Selling, general and administrative | 11,743 | 6,551 | |
Operating income (loss) | (12,505) | (7,250) | |
Total assets | 30,431 | $ 1,888 | |
Capital expenditures | $ 645 |
Segment Information - Revenue E
Segment Information - Revenue Earned from Domestic and International Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Revenue | $ 53,833 | $ 48,072 |
Domestic [Member] | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Revenue | 17,628 | 14,952 |
International [Member] | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Revenue | $ 36,205 | $ 33,120 |
Segment Information - Long - Li
Segment Information - Long - Lived Assets, Net of Accumulated Depreciation for Both Domestic and International Operations (Detail) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 31, 2017 |
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long lived assets | $ 149,192 | $ 127,837 |
Domestic [Member] | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long lived assets | 68,909 | 68,942 |
International [Member] | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long lived assets | $ 80,283 | $ 58,895 |