Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | Hill International, Inc. | |
Entity Central Index Key | 1,287,808 | |
Document Type | 10-Q/A | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | true | |
Amendment Description | As previously disclosed in the Company's Current Report on the Form 8-K filed with the Securities and Exchange Commission (the "SEC") on September 21, 2017, the Board of Directors (the "Board") of Hill International, Inc. ("Hill" or the "Company"), upon the recommendation of the Audit Committee of the Board, determined that the Company's previously issued financial statements for each of the years ended December 31, 2016, 2015 and 2014 and each of the quarters ended March 31, June 30, and September 30, 2016 and 2015 included in the Company's Annual Reports on Form 10-K filed with the SEC on March 31, 2017, as amended by the Company's Form 10-K/A (Amendment No. 1) filed with the SEC on May 1, 2017 (as amended, the "Original Form 10-K") and each of the Quarterly Reports on Form 10-Q for such periods as well as the Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 (the "Original Form 10-Q"), could no longer be relied upon. The Company filed its 10-K/A Amendment No. 2 (the "Amended 10-K ") that restated and amend the Company's Original Form 10-K on May 8, 2018. As a result, the Company is filing this Amendment No. 1 on Form 10-Q/A (this "Amendment") to restate and amend the Company's Original Form 10-Q. The Board's decision to restate its financial statements was in connection with the Company's review of the accounting for the May 2017 sale of the its Construction Claims Group and other comprehensive income (loss), including foreign currency translation adjustments related to intercompany balances. The Company determined that it had not accounted for foreign currency gains/losses on intercompany and other transactions not in accordance with U.S. generally accepted accounting principles ("US GAAP"). The review identified additional transactions and accounting practices not in accordance with US GAAP. This Amendment reflects the correction of the following errors identified subsequent to the filing of the Original Form 10-Q: A. The Company determined that it had not previously accounted for certain foreign currency gains/losses on intercompany balances and transactions in accordance with US GAAP. The Company improperly accounted for the foreign currency effect of certain transactions as if they were long-term investments by including the foreign currency effect in accumulated other comprehensive income instead of properly recording the effect as operating expenses as required under Accounting Standard Codification (ASC) 830 "Foreign Currency Matters." B. The Company identified departures from US GAAP under ASC 605-35 "Construction-Type and Production-Type Contracts" in its historical accounting for revenue recognition on nine long-term customer contracts with fee constraints (e.g., fixed fee, lump sum, maximum contract value). The Company enters into agreements for construction management and consulting services with customers, and the guidance of ASC 605-35 states that contracts for construction consulting services, such as under agency contracts or construction management agreements, fall within the scope of the standard and should follow either Percentage of Completion or Completed Contract methods of accounting. Historically, the Company had not consistently applied the percentage of completion method of revenue recognition. C. The Company discovered that it had not properly performed the required impairment testing of amortizable intangible assets in accordance with US GAAP in that an asset that was no longer in use as of July 2013 was not identified and impaired. In addition, an improper useful life was used for some of the Company's internally developed software assets resulting in an improper amount of amortization expense being recorded in previous periods. D. The Company discovered that the amounts of liabilities pertaining to the obligation for end of service benefits in six foreign countries were improperly accounted for under the guidance in ASC 715 "Compensation - Retirement Benefits". E. The Company determined the accrual for uncertain tax benefits taken with respect to income tax matters in Libya had been improperly released during 2013 and 2014 prior to the expiration of the statute of limitations on the Libyan tax authority's right to audit the related tax years. F. During the restatement process, the Company identified other transactions that had been recorded to incorrect accounts and/or in improper amounts. G. Some of the corrections noted above impacted earnings (loss) before taxes which, in turn, required a calculation of the tax impact. The following sections in the Original Form 10-Q have been revised in this Amendment to reflect the restatement: • Part I - Item - 1. Financial Statements. • Part I - Item - 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. • Part I - Item - 3. Quantitative and Qualitative Disclosures About Market Risk. • Part I - Item - 4. Controls and Procedures. • Part II - Item - 1A. Risk Factors. This Amendment does not reflect adjustments for events occurring after the filing of the Original Form 10-Q except to the extent they are otherwise required to be included and discussed herein and did not substantively modify or update the disclosures herein other than as required to reflect the adjustments described above. See Note 2 to the accompanying consolidated financial statements, set forth in Item 1 of this Amendment, for details of the restatement and its impact on the consolidated financial statements. See "Item 9A - Controls and Procedures" to the Company's Amended Form 10-K filed on May 8, 2018 that discloses additional material weaknesses in the Company's internal controls associated with the restatement, as well as management's restated conclusion that the Company's internal controls over financial reporting were not effective as of December 31, 2016. As disclosed therein, management is currently developing and implementing the changes needed in the Company's internal control over financial reporting to remediate these material weaknesses. These changes are still in process. We are also filing updated certifications from our Interim Chief Executive Officer and Interim Chief Financial Officer as Exhibits 31.1, 31.2, 32.1 and 32.2 to this Amendment. | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | No | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 52,960,817 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and cash equivalents | $ 20,413 | $ 25,637 |
Cash - restricted | 3,544 | 4,312 |
Accounts receivable, less allowance for doubtful accounts of $68,302 and $71,082 | 167,289 | 164,844 |
Accounts receivable - affiliates | 7,335 | 5,712 |
Prepaid expenses and other current assets | 7,799 | 7,751 |
Income taxes receivable | 2,900 | 3,554 |
Current assets held for sale | 53,351 | 54,651 |
Total current assets | 262,631 | 266,461 |
Property and equipment, net | 15,715 | 16,389 |
Cash - restricted, net of current portion | 327 | 313 |
Retainage receivable | 17,775 | 17,225 |
Acquired intangibles, net | 5,474 | 6,006 |
Goodwill | 51,467 | 50,665 |
Investments | 4,421 | 3,501 |
Deferred income tax assets | 3,176 | 3,200 |
Other assets | 4,009 | 4,224 |
Non-current assets held for sale | 32,924 | 32,091 |
Total assets | 397,919 | 400,075 |
Liabilities and Stockholders' Equity | ||
Current maturities of notes payable and long-term debt | 4,492 | 1,983 |
Accounts payable and accrued expenses | 87,993 | 85,680 |
Income taxes payable | 4,622 | 4,874 |
Current portion of deferred revenue | 5,094 | 12,943 |
Other current liabilities | 8,592 | 8,157 |
Current liabilities held for sale | 24,199 | 25,888 |
Total current liabilities | 134,992 | 139,525 |
Notes payable and long-term debt, net of current maturities | 150,808 | 142,120 |
Retainage payable | 1,000 | 961 |
Deferred income taxes | 629 | 560 |
Deferred revenue | 19,612 | 22,804 |
Other liabilities | 13,341 | 12,666 |
Non-current liabilities held for sale | 4,400 | 5,087 |
Total liabilities | 324,782 | 323,723 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued | ||
Common stock, $0.0001 par value; 100,000 shares authorized, 58,848 shares and 58,835 shares issued at March 31, 2017 and December 31, 2016, respectively | 6 | 6 |
Additional paid-in capital | 190,863 | 190,353 |
Accumulated deficit | (83,703) | (81,349) |
Accumulated other comprehensive loss | (6,168) | (4,611) |
Shareholders' equity before treasury stock and noncontrolling interests | 100,998 | 104,399 |
Less treasury stock of 6,977 shares at March 31, 2017 and December 31, 2016, respectively | (30,041) | (30,041) |
Hill International, Inc. share of equity | 70,957 | 74,358 |
Noncontrolling interests | 2,180 | 1,994 |
Total equity | 73,137 | 76,352 |
Total liabilities and stockholders' equity | $ 397,919 | $ 400,075 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowance for doubtful accounts | $ 68,302 | $ 71,082 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 58,848 | 58,835 |
Treasury stock, shares | 6,977 | 6,977 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | |||
Revenues | $ 116,120 | $ 136,899 | |
Direct expenses | 78,509 | 93,301 | |
Gross profit | 37,611 | 43,598 | |
Selling, general and administrative expenses | 33,463 | 37,793 | |
Share of loss (profit) of equity method affiliates | 34 | (15) | |
Operating profit | 4,114 | 5,820 | |
Interest and related financing fees, net | 749 | 628 | |
Earnings before income taxes | 3,365 | 5,192 | |
Income tax expense | 1,349 | 456 | |
Earnings from continuing operations | 2,016 | 4,736 | |
Loss from discontinued operations | (4,251) | (1,243) | $ (1,243) |
Net (loss) earnings | (2,235) | 3,493 | |
Less: net earnings (loss) - noncontrolling interests | 119 | (11) | |
Net (loss) earnings attributable to Hill International, Inc. | $ (2,354) | $ 3,504 | |
Basic earnings per common share from continuing operations | $ 0.04 | $ 0.09 | |
Basic loss per common share from discontinued operations | (0.09) | (0.02) | |
Basic (loss) earnings per common share - Hill International, Inc. | $ (0.05) | $ 0.07 | |
Basic weighted average common shares outstanding (in shares) | 51,860 | 51,631 | |
Diluted earnings per common share from continuing operations | $ 0.04 | $ 0.09 | |
Diluted (loss) per common share from discontinued operations | (0.09) | (0.02) | |
Diluted (loss) earnings per common share - Hill International, Inc. | $ (0.05) | $ 0.07 | |
Diluted weighted average common shares outstanding (in shares) | 51,860 | 51,722 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) EARNINGS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) EARNINGS | ||
Net (loss) earnings | $ (2,235) | $ 3,493 |
Foreign currency translation adjustment, net of tax | (1,558) | (3) |
Other, net | 34 | |
Comprehensive (loss) earnings | (3,793) | 3,524 |
Comprehensive earnings (loss) attributable to noncontrolling interests | 119 | (11) |
Comprehensive (loss) earnings attributable to Hill International, Inc. | $ (3,912) | $ 3,535 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Cash flows from operating activities: | ||
Net (loss) earnings | $ (2,235) | $ 3,493 |
Loss from discontinued operations | 4,251 | 1,243 |
Earnings from continuing operations | 2,016 | 4,736 |
Adjustments to reconcile net (loss) earnings to net cash (used in): | ||
Depreciation and amortization | 1,595 | 1,906 |
Provision for bad debts | (526) | 1,271 |
Amortization of deferred loan fees | 444 | 444 |
Deferred tax benefit | 452 | 4,387 |
Stock based compensation | 461 | 668 |
Unrealized foreign exchange losses (gains) on intercompany balances | (1,813) | 206 |
Changes in operating assets and liabilities: | ||
Restricted cash | 736 | 397 |
Accounts receivable | (2,617) | (9,161) |
Accounts receivable - affiliate | (1,615) | (4,262) |
Prepaid expenses and other current assets | (287) | 330 |
Income taxes receivable | 1,366 | (281) |
Retainage receivable | (310) | (281) |
Other assets | (2,037) | 9,796 |
Accounts payable and accrued expenses | 2,150 | (5,933) |
Income taxes payable | (328) | (4,637) |
Deferred revenue | (10,010) | 726 |
Other current liabilities | 156 | 2,538 |
Retainage payable | 39 | 266 |
Other liabilities | 185 | 508 |
Net cash (used in) provided by continuing operations | (9,943) | 3,624 |
Net cash used in discontinued operations | (6,146) | (2,781) |
Net cash (used in) provided by operating activities | (16,089) | 843 |
Cash flows from investing activities: | ||
Purchases of business | (123) | (58) |
Payments for purchase of property and equipment | (372) | (392) |
Net cash used in investing activities of continuing operations | (495) | (450) |
Net cash provided by investing activities of discontinued operations | 44 | |
Net cash used in investing activities | (495) | (406) |
Cash flows from financing activities: | ||
Payments on term loans | (314) | (348) |
Net borrowings on revolving loans | 10,990 | 819 |
Proceeds from stock issued under employee stock purchase plan | 49 | 10 |
Proceeds from exercise of stock options | 86 | |
Net cash provided by financing activities | 10,725 | 567 |
Effect of exchange rate changes on cash | 635 | (4,058) |
Net decrease in cash and cash equivalents | (5,224) | (3,054) |
Cash and cash equivalents - beginning of period | 25,637 | 24,089 |
Cash and cash equivalents - end of period | $ 20,413 | $ 21,035 |
The Company
The Company | 3 Months Ended |
Mar. 31, 2017 | |
The Company | |
The Company | Note 1 — The Company Hill International, Inc. (“Hill” or the “Company”) is a professional services firm that provides program management, project management, construction management and other consulting services primarily to the buildings, transportation, environmental, energy and industrial markets worldwide. Hill’s clients include the U.S. federal government, U.S. state and local governments, foreign governments and the private sector. |
Restatement and Revision of Pre
Restatement and Revision of Previously Reported Consolidated Financial Statements | 3 Months Ended |
Mar. 31, 2017 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | Note 2 — Restatement and Revision of Previously Reported Consolidated Financial Statements As previously disclosed on Form 8-K filed on September 21, 2017, the Board of Directors (the “Board”) of Hill International, Inc. (the “Company”), upon the recommendation of the Audit Committee of the Board, determined that the Company’s previously issued financial statements for each of the years ended December 31, 2016, 2015 and 2014 and the quarters ended March 31, June 30, and September 30, 2015 and 2016 included in the Company’s Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q for such periods and the Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 (collectively, the “Non-Reliance Periods”) can no longer be relied upon. The nature of the restatement matters and adjustments along with the impact on the Company’s previously issued financial statements for each of the years ended December 31, 2016, 2015 and 2014 and the quarters ended March 31, June 30, and September 30, 2015 and 2016 included in the Company’s Annual Reports on Form 10-K are disclosed on Form 10K/A (Amendment No. 2), which was filed with the SEC on filed May 4, 2018. This Note 2 to the consolidated financial statements discloses the nature of the restatement matters and adjustments and shows the impact of the restatement as of and for the three months ended March 31, 2017 and 2016. The following errors were identified as part of the restatement: A. In connection with the accounting for the May 2017 sale of its Construction Claims Group, the Company determined that it had not previously accounted for certain foreign currency gains/losses on intercompany balances and transactions in accordance with accounting principles generally accepted in the United States (“US GAAP”). The Company improperly accounted for the foreign currency effect of certain transactions as if they were long-term investments by including the foreign currency effect in accumulated other comprehensive income instead of properly recording the effect as operating expenses as required under Accounting Standard Codification (ASC) 830 “Foreign Currency Matters.” The correction of the error resulted in a reduction to retained earnings of $46,601,000 and a reduction to accumulated other comprehensive loss of $46,601,000 at March 31, 2017, and selling, general and administrative (“SG&A”) expenses decreased $1,813,000 and increased $206,000 for the three months ended March 31, 2017 and 2016, respectively. B. The Company identified departures from US GAAP under ASC 605-35 “Construction-Type and Production-Type Contracts” in its historical accounting for revenue recognition on nine long-term customer contracts with fee constraints (e.g., fixed fee, lump sum, maximum contract value). The Company enters into agreements for construction management and consulting services with customers, and the guidance of ASC 605-35-15-3D states that contracts for construction consulting services, such as under agency contracts or construction management agreements, fall within the scope of the standard and should follow either Percentage of Completion or Completed Contract methods of accounting. Historically, the Company had not consistently applied the percentage of completion method of revenue recognition. The correction to properly apply U.S. GAAP to the identified contracts resulted in an increase of $3,130,000 and $2,581,000 in revenues for the three months ended March 31, 2017 and 2016, respectively; an increase of $821,000 in accounts receivable, an increase in accumulated other comprehensive loss of $1,000 and an increase in deferred revenues of $7,513,000 at March 31, 2017. C. The Company discovered that it had not properly performed the required impairment testing of amortizable intangible assets in accordance with US GAAP in that certain assets no longer in use were not identified and impaired. In addition, an improper useful life was used for some of the Company’s internally developed software assets resulting in an improper amount of amortization expense being recorded in previous periods. The net effect of correcting these errors resulted in a $458,000 decrease in property plant and equipment, a $722,000 decrease in acquired intangibles, an increase of $567,000 in assets held for sale and a $213,000 decrease in accumulated other comprehensive loss at March 31, 2017; a $565,000 increase in earnings from discontinued operations for the three months ended March 31, 2017; and increases of $29,000 and $28,000 to SG&A expense for the three months ended March 31, 2017 and 2016, respectively. D. The Company discovered that the amounts of liabilities pertaining to the obligation for end of service benefits in certain foreign countries were improperly accounted for under the guidance in ASC 715 “Compensation — Retirement Benefits”. The net effect of the corrections of these errors resulted in a $349,000 decrease in other liabilities at March 31, 2017; and a $458,000 increase in liabilities held for sale at March 31, 2017. E. The Company determined the accrual for uncertain tax benefits taken with respect to income tax matters in Libya had been improperly released during 2013 and 2014 prior to the expiration of the statute of limitations on the Libyan tax authority’s right to audit the related tax years. The correction of these errors resulted in an increase of $4,408,000 in other liabilities at March 31, 2017; and a decrease of $695,000 in accumulated other comprehensive loss at March 31, 2017. F. The Company identified other transactions that had been recorded to incorrect accounts and/or in improper amounts. The net corrections of these transactions resulted in a $5,421,000 increase and $52,000 decrease in revenues for the three months ended March 31, 2017 and 2016, respectively; a $5,305,000 increase in direct expenses for the three months ended March 31, 2017; an increase of $473,000 and a decrease of $839,000 in SG&A expenses for the three months ended March 31, 2017 and 2016, respectively; a $1,057,000 decrease and a $390,000 increase in net loss from discontinued operations for the three months ended March 31, 2017 and 2016, respectively; an increase of $36,000 in investments at March 31, 2017; a $755,000 increase in assets held for sale at March 31, 2017; a $1,243,000 increase in accounts payable and accrued expenses at March 31, 2017; a $77,000 increase in other current liabilities at March 31, 2017; a decrease in current liabilities held for sale of $1,915,000 at March 31, 2017; a $984,000 decrease in other liabilities at March 31, 2017; an increase in liabilities held for sale of $1,738,000 at March 31, 2017; an increase of $329,000 in additional paid in capital at March 31, 2017; a decrease of $563,000 to accumulated other comprehensive loss at March 31, 2017; an increase in noncontrolling interest of $36,000 at March 31, 2017; and an increase of $58,000 and a decrease of $15,000 in net earnings-noncontrolling interest for the three months ended March 31, 2017 and 2016, respectively. In conjunction with the sale of the construction claims group in 2016, interest expense of $552,000 and $415,000 for the three months ended March 31, 2017 and 2016, respectively, was reclassified from discontinued operations to continuing operations. In addition, the adjustment to forfeitures resulted in a $422,000 increase in retained earnings at March 31, 2017; a $422,000 decrease in additional paid in capital at March 31, 2017; and a $91,000 decrease in selling, general and administrative expenses for the three months ended March 31, 2017. G. Some of the corrections noted above impacted earnings (loss) before taxes which, in turn, required a calculation of the tax impact. The net impact was a $1,129,000 increase in deferred income tax assets at March 31, 2017; a decrease of $1,751,000 to assets held for sale at March 31, 2017; an increase in income tax payable of $858,000 at March 31, 2017; an increase in current liabilities held for sale of $208,000 at March 31, 2017; an increase in deferred income taxes of $10,000 at March 31, 2017; liabilities held for sale decreased $1,647,000 at March 31, 2017; retained earnings increased $235,000 at March 31, 2017; accumulated other comprehensive loss increased $286,000 at March 31 2017; and income tax expense increased $695,000 and $290,000 for the three months ended March 31, 2017 and 2016, respectively. Consolidated Balance Sheet March 31, 2017 As Adjustment As Restated Reference Assets Cash and cash equivalents $ $ — $ Cash - restricted — Accounts receivable, less allowance for doubtful accounts of $68,302 B Accounts receivable - affiliates — Prepaid expenses and other current assets — Income taxes receivable — Current assets held for sale — Total current assets Property and equipment, net ) C Cash - restricted, net of current portion — Retainage receivable — Acquired intangibles, net ) C Goodwill — Investments F Deferred income tax assets G Other assets — Assets held for sale ) C, F, G Total assets $ $ 377 $ Liabilities and Stockholders’ Equity Due to banks $ — $ — $ — Current maturities of notes payable and long-term debt — Accounts payable and accrued expenses F Income taxes payable G Current portion of deferred revenue — Other current liabilities F Current liabilities held for sale ) F, G Total current liabilities Notes payable and long-term debt, net of current maturities — Retainage payable — Deferred income taxes G Deferred revenue B Other liabilities D, E, F Liabilities held for sale D, F, G Total liabilities Commitments and contingencies Stockholders’ equity: Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued — — — Common stock, $0.0001 par value; 100,000 shares authorized, 58,848 shares issued at March 31, 2017 — Additional paid-in capital ) F Retained earnings (deficit) ) ) ) A, B, C, D, E, F, G Accumulated other comprehensive loss ) ) A, C, E, F, G ) Less treasury stock of 6,977 shares at December 31, 2016 ) — ) Hill International, Inc. share of equity ) Noncontrolling interests F Total equity ) Total liabilities and stockholders’ equity $ $ $ Consolidated Statement of Operations Three months ended March 31, 2017 As Adjustment As Restated Reference Revenues B, F Direct expenses F Gross Profit Selling, general and administrative expenses ) A, C, F Share of loss of equity method affiliates — Operating profit ) Interest and related financing fees, net F (Loss)earnings before income taxes ) Income tax expense G Loss from continuing operations ) Loss from discontinued operations ) ) C, F, G Net (loss) earnings ) ) Less: net earnings - noncontrolling interest F Net Loss attributiable to Hill International, Inc. $ ) $ $ ) Basic (loss)earnings per common share from continuing operations $ ) $ $ Basic loss per common share from discontinued operations ) ) Basic loss per common share - Hill International, Inc. $ ) $ $ ) Basic weighted average common shares outstanding — Diluted loss per common share from continuing operations $ ) $ $ Diluted loss per common share from discontinued operations ) ) Diluted loss per common share - Hill International, Inc. $ ) $ $ ) Basic weighted average common shares outstanding — Consolidated Statement of Operations Three months ended March 31, 2016 As Adjustment As Restated Reference Revenues B, F Direct expenses — Gross Profit Selling, general and administrative expenses ) A, C, F Share of loss of equity method affiliates ) — ) Operating profit Interest and related financing fees, net F (Loss)earnings before income taxes Income tax expense G Loss from continuing operations Loss from discontinued operations ) ) ) F Net (loss) earnings Less: net earnings - noncontrolling interest ) ) F Net Loss attributiable to Hill International, Inc. $ $ $ Basic loss per common share from continuing operations $ $ $ Basic loss per common share from discontinued operations ) ) ) Basic loss per common share - Hill International, Inc. $ $ $ Basic weighted average common shares outstanding — Diluted loss per common share from continuing operations $ $ $ Diluted loss per common share from discontinued operations ) ) ) Diluted loss per common share - Hill International, Inc. $ $ $ Basic weighted average common shares outstanding — Consolidated Statement of Comprehensive Loss Three months ended March 31, 2017 As Previously Adjustment As Restated Reference Net earnings $ ) $ ) A, B, C, F Foreign currency translation adjustment, net ) ) A, B, C, E, F, G Other, net — — — Comprehensive loss ) ) Comprehensive loss attributable to noncontrolling interest ) Comprehensive loss attributable to Hill International, Inc. $ ) $ ) Consolidated Statement of Comprehensive Income Three months ended March 31, 2016 As Previously Adjustment As Restated Reference Net earnings $ $ A, B, C, F, G Foreign currency translation adjustment, net ) ) A, B, C, E, F, G Other, net — Comprehensive loss Comprehensive loss attributable to noncontrolling interest ) ) A Comprehensive loss attributable to Hill International, Inc. $ $ In addition to the items noted above as part of the Restatement, the Company identified departures from US GAAP in its historical preparation and presentation of its statement of cash flows. The Company did not report its cash flows in the reporting currency equivalent of foreign currency using the exchange rates in effect at the time of the cash flows, or an appropriate average rate to approximate the rates in effect at the time of the cash flows. The impact of properly preparing a cash flow statement in each functional currency, translating the cash flow statement using the appropriate rate in effect at the time of a transaction, or substantially equivalent average rate for the period, and consolidation of the individual functional currency cash flows, as prescribed by the guidance in ASC 230, is depicted in the table below. The adjustments noted in the cash flow statements that follow are both a result of items “A” through “G” explained above, as well as the foreign currency effect from cash flow statements prepared in functional currency and appropriately translated. Consolidated Statement of Cash Flows As Previously Adjustment As restated Cash flows from operating activities: Net (loss) earnings $ ) $ ) Loss from discontinued operations ) (Loss) earnings from continuing operations ) Adjustments to reconcile net (loss) earnings to net cash (used in): Depreciation and amortization Provision for bad debts ) — ) Amortization of deferred loan fees — Deferred tax benefit Stock based compensation ) Unrealized foreign exchange losses (gains) on intercompany balances — ) ) Changes in operating assets and liabilities: Restricted cash ) Accounts receivable ) ) ) Accounts receivable - affiliate ) ) Prepaid expenses and other current assets ) ) Income taxes receivable Retainage receivable ) ) Other assets ) ) ) Accounts payable and accrued expenses Income taxes payable ) ) Deferred revenue ) ) ) Other current liabilities ) Retainage payable Other liabilities ) Net cash used in continuing operations ) ) ) Net cash (used in) provided by discontinued operations ) ) Net cash used in operating activities ) ) ) Cash flows from investing activities: Purchase of businesses, net of cash aquired — ) ) Payments for purchase of property and equipment ) ) ) Net cash used in investing activities of continuing operations ) ) ) Net cash used in investing activities of discontinued operations ) — Net cash used in investing activities ) ) Cash flows from financing activities: Payments on term loans ) — ) Net borrowings on revolving loans ) Proceeds from stock issued under employee stock purchase plan — Net cash provided by financing activities ) Effect of exchange rate changes on cash Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents — beginning of period — Cash and cash equivalents — end of period $ — $ Consolidated Statement of Cash Flows As Previously Adjustment As restated Cash flows from operating activities: Net (loss) earnings $ $ Loss from discontinued operations (Loss) earnings from continuing operations Adjustments to reconcile net (loss) earnings to net cash (used in): Depreciation and amortization Provision for bad debts — Amortization of deferred loan fees — Deferred tax benefit Stock based compensation — Unrealized foreign exchange losses (gains) on intercompany balances — Changes in operating assets and liabilities: Restricted cash Accounts receivable ) ) ) Accounts receivable - affiliate ) ) ) Prepaid expenses and other current assets Income taxes receivable ) ) Retainage receivable ) — ) Other assets Accounts payable and accrued expenses ) ) Income taxes payable ) ) ) Deferred revenue ) Other current liabilities ) Retainage payable — Other liabilities ) Net cash (used in) provided by continuing operations ) Net cash (used in) provided by discontinued operations ) ) Net cash (used in) provided by operating activities ) Cash flows from investing activities: Purchase of businesses, net of cash aquired — ) ) Payments for purchase of property and equipment ) ) ) Net cash used in investing activities of continuing operations ) ) ) Net cash (used in) provided by investing activities of discontinued operations ) Net cash used in investing activities ) ) ) Cash flows from financing activities: Payments on term loans ) ) Net borrowings on revolving loans ) Proceeds from stock issued under employee stock purchase plan — Proceeds from exercise of stock options — Net cash provided by financing activities ) Effect of exchange rate changes on cash ) ) Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents — beginning of period — Cash and cash equivalents — end of period $ — $ |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations | |
Discontinued Operations | Note 3 - Discontinued Operations In early 2016, the Company began to investigate the sale of its Construction Claims Group (the “Claims Group”). The pending sale of that segment represents a strategic shift that will have a major effect on its operations and financial results. Accordingly, the Company had classified the assets and liabilities of that segment as held for sale and has reflected its operations and cash flows as discontinued operations for all periods presented. On December 20, 2016, the Company and its subsidiary Hill International N.V. (“Hill N.V.” and, collectively with the Company, the “Sellers”) entered into a Stock Purchase Agreement (as amended on May 3, 2017, the “Agreement”) with Liberty Mergeco, Inc. (the “US Purchaser”) and Liberty Bidco UK Limited (the “UK Purchaser” and, collectively with the US Purchaser, the “Purchasers”) pursuant to which the Purchasers will acquire the Claims Group by the US Purchaser’s acquisition of all of the stock of Hill International Consulting, Inc. from the Company and the UK Purchaser’s acquisition of all of the stock of Hill International Consulting B.V. from Hill N.V. for a total purchase price of $140.0 million in cash reduced by assumed indebtedness and certain other items, as set forth in the Agreement. The transaction closed effective May 5, 2017. See Note 19 for further information. The carrying amounts of assets and liabilities of the discontinued operations which have been classified as held for sale are as follows (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Accounts receivable, net $ $ Prepaid expenses and other current assets Income taxes receivable Total current assets classified as held for sale $ $ Property and equipment, net Acquired intangibles, net Goodwill Investments Other assets Total non-current assets classified as held for sale $ $ Accounts payable and accrued expenses Income taxes payable Deferred revenue Other current liabilities Total current liabilities classified as held for sale $ $ Deferred income taxes Deferred revenue Retained Earnings Other liabilities Total non-current liabilities classified as held for sale $ $ The line items constituting earnings from discontinued operations consist of the following (in thousands): March 31, 2017 2016 (As restated) (As restated) Revenues $ $ Direct expenses Gross profit Selling, general and administrative expenses Operating (loss) profit ) Interest and related financing fees, net Loss before income taxes ) ) Income tax expense Net loss from discontinued operations $ ) $ ) In connection with the sale of the Construction Claims Group, the Company will be required to pay off the Secured Credit Facilities (See Note 19). Accordingly, the Company has allocated to discontinued operations all interest expense related to the Secured Credit Facilities. During the first quarter of 2017, the Company charged discontinued operations approximately $1.6 million of costs related to the pending sale of the Construction Claims and $0.4 million for a potential tax liability related to foreign jurisdictions. See Notes 18 and 19 for further information. |
Liquidity
Liquidity | 3 Months Ended |
Mar. 31, 2017 | |
Liquidity | |
Liquidity | Note 4 - Liquidity The amount of revenues attributable to operations in the Middle East and Africa is approximately $51,491,000 of total consolidated revenue for the three months ended March 31, 2017. There has been significant political upheaval and civil unrest in this region, most notably in Libya and Iraq where the Company had substantial operations. In 2012, due to the overthrow of the Libyan government, the Company reserved a $59,937,000 receivable from the Libyan Organization for Development of Administrative Centres (“ODAC”). Subsequently, the Company received payments totaling approximately $9,511,000. During the quarter ended March 31, 2017, the Company wrote off approximately $3,593,000 and maintains a reserve of approximately $2,777,000 against accounts receivable from various projects in Iraq. This shortfall of cash flows continues to put a considerable strain on its liquidity. The Company continues to experience slowing of collections from its clients in the Middle East, primarily Oman. In 2012, the Company commenced operations on the Muscat International Airport (the “Oman Airport”) project with the Ministry of Transport and Communications (the “MOTC”) in Oman. The original contract term expired in November 2014. In October 2014, the Company applied for a twelve-month extension of time amendment (the “first extension”) which was subsequently approved in March 2016 and the Company continued to work on the Oman Airport project. The Company began to experience delays in payments during the second quarter of 2015 when MOTC commenced its formal review and certification of the Company’s invoices. In October 2015, the MOTC paid the Company for work performed in April and May 2015. In December 2015, the Company began discussions with the MOTC on a second extension of time amendment (“the second extension”) and has since commenced additional work, which management expects to last through approximately June 2018. The MOTC resumed payments in 2016, paying the Company approximately $42,000,000 during 2016 and approximately $12,728,000 through April 2017. At March 31, 2017, accounts receivable from the Oman Airport totaled approximately $29,200,000, of which approximately $18,700,000 was past due based on contractual terms. The delays in payments from MOTC and other foreign governments have had a negative impact on the Company’s liquidity, financial covenants, financial position and results of operations. As a result, the Company has had to rely heavily on debt and equity transactions to fund its operations over the past few years. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Basis of Presentation | |
Basis of Presentation | Note 5 — Basis of Presentation Basis of Presentation The accompanying unaudited interim consolidated financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission pertaining to reports on Form 10-Q and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K/A (Amendment No. 2) for the year ended December 31, 2016. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, these statements include all adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of the consolidated financial statements. The consolidated financial statements include the accounts of Hill and its wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The interim operating results are not necessarily indicative of the results for a full year. |
Accounts Receivable
Accounts Receivable | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Receivable | |
Accounts Receivable | Note 6 — Accounts Receivable The components of accounts receivable are as follows (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Billed $ $ Retainage, current portion Unbilled Allowance for doubtful accounts ) ) Total $ $ Unbilled receivables primarily represent revenue earned on contracts, which the Company is contractually precluded from billing until predetermined future dates. In 2012, the Company commenced operations on the Muscat International Airport (the “Oman Airport”) project with the Ministry of Transport and Communications (the “MOTC”) in Oman. The original contract term expired in November 2014. In October 2014, the Company applied for a twelve-month extension of time amendment (the “first extension”) which was subsequently approved in March 2016 and the Company continued to work on the Oman Airport project. The Company began to experience delays in payments during the second quarter of 2015 when MOTC commenced its formal review and certification of the Company’s invoices. In December 2015, the Company began discussions with the MOTC on a second extension of time amendment (the “second extension”) and has since commenced additional work, which management expects to last through approximately June 2018. When the MOTC resumed payments in 2016, the Company received approximately $42,000,000 during that year. At March 31, 2017, accounts receivable from the Oman Airport totaled approximately $29,200,000, of which approximately $18,700,000, was past due based on contractual terms. Through April 2017, the Company received payments totaling approximately $12,728,000 against this receivable. In addition, there is approximately $17,000,000 included in non-current Retainage Receivable in the consolidated balance sheet at March 31, 2017. Of that amount, approximately $8,400,000 relates to retention and approximately $8,600,000 relates to a Defect and Liability Period (“DLP”). Retention represents five percent of each monthly invoice which is retained by MOTC. Fifty percent of the retention will be released one year from the commencement of the DLP and the balance will be released upon the issuance of final Completion Certificates. DLP represents the period by which the contractor must address any defect issues. This period commences upon the issuance of a “Taking Over Certificate” (by MOTC) to contractors for up to a period of 24 months and ends with a final certificate closing the project. The delays in payments from MOTC and other foreign governments have had a negative impact on the Company’s liquidity, financial covenants, financial position and results of operations. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2017 | |
Intangible Assets | |
Intangible Assets | Note 7 — Intangible Assets The following table summarizes the Company’s acquired intangible assets (in thousands): March 31, 2017 December 31, 2016 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization (As restated) (As restated) (As restated) (As restated) Client relationships $ $ $ $ Acquired contract rights Trade names Total $ $ $ $ Intangible assets, net $ $ Amortization expense related to intangible assets was as follows (in thousands): Three Months Ended March 31, 2017 2016 (As restated) (As restated) $ $ The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands): Estimated Amortization Year ending December 31, Expense (As restated) 2017 (remaining 9 months) $ |
Goodwill
Goodwill | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill | |
Goodwill | Note 8 — Goodwill The following table summarizes the changes in the Company’s carrying value of goodwill during 2017 (in thousands): As restated Balance, December 31, 2016 $ Additions — Translation adjustments Balance, March 31, 2017 $ |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Accrued Expenses | |
Accounts Payable and Accrued Expenses | Note 9 — Accounts Payable and Accrued Expenses Below are the components of accounts payable and accrued expenses (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Accounts payable $ $ Accrued payroll and related expenses Accrued subcontractor fees Accrued agency fees Accrued legal and professional fees Other accrued expenses $ $ |
Notes Payable and Long-Term Deb
Notes Payable and Long-Term Debt | 3 Months Ended |
Mar. 31, 2017 | |
Notes Payable and Long-Term Debt | |
Notes Payable and Long-Term Debt | Note 10 — Notes Payable and Long-Term Debt Outstanding debt obligations are as follows (in thousands): March 31, 2017 December 31, 2016 Term Loan Facility $ $ Domestic Revolving Credit Facility International Revolving Credit Facility Borrowings under revolving credit facilities with a consortium of banks in Spain Borrowings under revolving credit facilities with the National Bank of Abu Dhabi — Borrowings from Philadelphia Industrial Development Corporation Less current maturities Notes payable and long-term debt, net of current maturities $ $ In conjunction with the sale of its Construction Claims Group in May 2017, the Company paid off and terminated the Secured Credit Facilities described below and has entered into a new credit facility (See Note 19). The disclosures that follow below describe the Secured Credit Facilities in existence as of March 31, 2017. The Company and its subsidiary Hill International N.V. (the “Subsidiary”) are parties to a credit agreement with Société Générale (the “Agent”), TD Bank, N.A. and HSBC Bank USA, N.A. (collectively, the “U.S. Lenders”) consisting of a term loan facility of $120,000,000 (the “Term Loan Facility”) and a $30,000,000 U.S. dollar-denominated facility available to the Company (the “U.S. Revolver,” together with the Term Loan Facility, the “U.S. Credit Facilities”) and a credit agreement with the Agent (the “International Lender”) providing a €11,765,000 ($15,000,000 at closing and $12,573,000 at March 31, 2017) credit facility which is available to the Subsidiary (the “International Revolver” and together with the U.S. Revolver, the “Revolving Credit Facilities” and, together with the U.S. Credit Facilities, the “Secured Credit Facilities”). The U.S. Revolver and the International Revolver include sub-limits for letters of credit amounting to $25,000,000 and $10,000,000, respectively. The Secured Credit Facilities contain customary default provisions, representations and warranties, and affirmative and negative covenants, and require the Company to comply with certain financial and reporting covenants. The financial covenants consist of a Maximum Consolidated Net Leverage Ratio and an Excess Account Concentration requirement. The Consolidated Net Leverage Ratio is the ratio of (a) consolidated total debt (minus cash of up to $10,000,000 held in the aggregate) to (b) consolidated earnings before interest, taxes, depreciation, amortization, non-cash items and share-based compensation and other non-cash charges, including bad debt expense, for the trailing twelve months. In the event of a default, the U.S. Lenders and the International Lender may increase the interest rates by 2.0%. At December 31, 2016, the Company was in default of the Consolidated Net Leverage Ratio. The Company requested and received a waiver of the default from the Agent on March 27, 2017. In connection with the waiver, the Company incurred a consent fee amounting to $401,000 that was charged to discontinued operations in the first quarter of 2017. The Excess Account Concentration covenant permits the U.S. Lenders and the International Lender to increase the interest rates by 2.0% if, as of the last day of any fiscal quarter, either (a) the accounts receivable from any country not listed as a Permitted Country as defined in the Secured Credit Facilities (other than the United Arab Emirates) that are more than 120 days old (relative to the invoice date) constitute more than 10% of the total outstanding accounts receivable or (b) accounts receivable from any individual client located in the United Arab Emirates that are more than 120 days old (relative to the invoice date) constitute more than 14% of the total outstanding accounts receivable. The interest rate will be reset as soon as the accounts receivable over 120 days decline below the 10% or 14% levels. At March 31, 2017, the accounts receivable from Oman exceeded the limit described above, however, due to a payment received on April 12, 2017, the accounts receivable declined below the established limit. The U.S. Credit Facilities are guaranteed by certain U.S. subsidiaries of the Company, and the International Revolver is guaranteed by the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. Term Loan Facility The interest rate on the Term Loan Facility will be, at the Company’s option, either: · the London Inter-Bank Offered Rate (“LIBOR”) for the relevant interest period plus 6.75% per annum, provided that such LIBOR shall not be lower than 1.00% per annum; or · the Base Rate (as described below) plus 5.75% per annum. The “Base Rate” is a per annum rate equal to the highest of (A) the prime rate, (B) the federal funds effective rate plus 0.50%, or (C) the LIBOR for an interest period of one month plus 1.0% per annum. Upon a default, the applicable rate of interest under the Secured Credit Facilities may increase by 2.0%. The LIBOR on the Term Loan Facilities (including when determining the Base Rate) shall in no event be less than 1.0% per annum. At March 31, 2017, the interest rate on the Term Loan was 7.75%. The Company has the right to prepay the Term Loan Facility in full or in part at any time without premium or penalty. The Company is required to make mandatory prepayments of the Term Loan Facility, without premium or penalty, (i) with net proceeds of any issuance or incurrence of indebtedness (other than that permitted under the Term Loan Facility) by the Company after the closing, (ii) with net proceeds from certain asset sales outside the ordinary course of business, and (iii) with 50% of the excess cash flow (as defined in the agreement) for each fiscal year of the Borrowers commencing with the first full fiscal year ending after closing (which percentage would be reduced to 25% if the Consolidated Net Leverage Ratio is equal to or less than 2.25 to 1.00 or reduced to 0% if the Consolidated Net Leverage Ratio is equal to or less than 1.50 to 1.00). The Term Loan Facility is generally secured by a first-priority security interest in substantially all assets of the Company and certain of the Company’s U.S. subsidiaries other than accounts receivable, cash proceeds thereof and certain bank accounts, as to which the Term Loan Facility is secured by a second-priority security interest. The Term Loan Facility has a term of six years, requires repayment of 0.25% of the original principal amount on a quarterly basis through September 30, 2020, the maturity date. Any amounts repaid on the Term Loan Facility will not be available to be re-borrowed. The Company incurred fees and expenses related to the Term Loan Facility aggregating $7,066,000 which have been deferred. The deferred fees are being amortized on a straight-line basis, which approximates the effective interest method, to interest and related financing fees, net over a six-year period which ends on September 30, 2020. Unamortized balances of $4,122,000 and $4,416,000 are included as an offset against the Term Loan balances in the consolidated balance sheets at March 31, 2017 and December 31, 2016, respectively. Revolving Credit Facilities The interest rate on borrowings under the U.S. Revolver will be, at the Company’s option from time to time, either the LIBOR for the relevant interest period plus 3.75% per annum or the Base Rate plus 2.75% per annum. At March 31, 2017, the interest rate was 6.75%. The interest rate on borrowings under the International Revolver will be the European Inter-Bank Offered Rate, or “EURIBOR,” for the relevant interest period (or at a substitute rate to be determined to the extent EURIBOR is not available) plus 4.00% per annum. At March 31, 2017, the interest rate was 3.60%. The Company will pay a commitment fee calculated at 0.50% annually on the average daily unused portion of the U.S. Revolver, and the Subsidiary will pay a commitment fee calculated at 0.75% annually on the average daily unused portion of the International Revolver. The ability to borrow under each of the U.S. Revolver and the International Revolver is subject to a “borrowing base,” calculated using a formula based upon approximately 85% of receivables that meet or satisfy certain criteria (“Eligible Receivables”) and that are subject to a perfected security interest held by either the U.S. Lenders or the International Lender, plus, in the case of the International Revolver only, 10% of Eligible Receivables that are not subject to a perfected security interest held by the International Lender, subject to certain exceptions and restrictions. The Company or the Subsidiary, as applicable, will be required to make mandatory prepayments under their respective Revolving Credit Facilities to the extent that the aggregate outstanding amount thereunder exceeds the then-applicable borrowing base, which payments will be made without penalty or premium. At March 31, 2017, the domestic borrowing base was $30,000,000 and the international borrowing base was €11,765,000 (approximately $12,573,000 at March 31, 2017). Generally, the obligations of the Company under the U.S. Revolver are secured by a first-priority security interest in the above-referenced accounts receivable, cash proceeds and bank accounts of the Company and certain of the Company’s U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and such subsidiaries. The obligations of the Subsidiary under the International Revolver would generally be secured by a first-priority security interest in substantially all accounts receivable, cash proceeds thereof and certain bank accounts of the Subsidiary and certain of the Company’s non-U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. The Revolving Credit Facilities have a term of five years and require payment of interest only during the term. Under the Revolving Credit Facilities, outstanding loans may be repaid in whole or in part at any time, without premium or penalty, subject to certain customary limitations, and will be available to be re-borrowed from time to time through expiration on September 30, 2019. The Company incurred fees and expenses related to the Revolving Credit Facilities aggregating $3,000,000 which has been deferred. The deferred fees are being amortized on a straight-line basis, which approximates the effective interest method, to interest expense and related financing fees, net over a five-year period which ends on September 30, 2019. Unamortized balances of $1,500,000 and $1,650,000 are included in other assets in the consolidated balance sheet at March 31, 2017 and December 31, 2016, respectively. At March 31, 2017 the Company had $4,470,000 of outstanding letters of credit and $530,000 of available borrowing capacity under the U.S. Revolver. At March 31, 2017, the Company had $909,000 of outstanding letters of credit and $1,604,000 of available borrowing capacity under the International Revolver and its other foreign credit agreements (See “Other Debt Arrangements” below for more information). Other Debt Arrangements In connection with the 2015 move of its corporate headquarters to Philadelphia, Pennsylvania, the Company received a loan from the Philadelphia Industrial Development Corporation in the amount of $750,000 which bears interest at 2.75%, is repayable in 144 equal monthly installments of $6,121 and matures on May 1, 2027. The Company’s subsidiary, Hill International (Spain) S.A. (“Hill Spain”), maintained a revolving credit facility with six banks in Spain which initially provided for total borrowing of up to €5,640,000 with interest at 6.50% on outstanding borrowings. The facility expired on December 17, 2016. Concurrent with the satisfaction of this facility Hill Spain entered into a new agreement with three new banks. The total new facility is for €2,623,000 (approximately $2,803,000) at March 31, 2017. The facility was fully utilized at March 31, 2017. Interest rates at March 31, 2017 were between 1.85% and 3.50%. The loans have varying expiration dates between 36 and 60 months. Hill Spain also maintains an ICO (Official Credit Institute) loan with Bankia Bank in Spain for €30,000 (approximately $32,000) at March 31, 2017. The availability is reduced by €15,000 on a quarterly basis. At March 31, 2017, the loan was fully utilized. The interest rate at March 31, 2017 was 6.50%. The ICO loan expires on August 10, 2017. The Company maintains a credit facility with the National Bank of Abu Dhabi which provides for total borrowings of up to AED 11,500,000 (approximately $3,131,000 at March 31, 2017) collateralized by certain overseas receivables. At March 31, 2017, AED 9,811,000 was utilized (approximately $2,671,000). The interest rate is the one-month Emirates InterBank Offer Rate plus 3.50% (or 4.91% at March 31, 2017) but no less than 5.50%. This facility allows for letters of guarantee up to AED 200,000,000 (approximately $54,451,000 at March 31, 2017) of which AED 99,180,000 (approximately $27,002,000) was outstanding at March 31, 2017. The credit facility is subject to periodic review by the bank and as such has been classified as current in the consolidated balance sheet. Engineering S.A. maintains four unsecured revolving credit facilities with two banks in Brazil aggregating 2,380,000 Brazilian Reais (BRL) (approximately $755,000 at March 31, 2017, with a weighted average interest rate of 5.07% per month at March 31, 2017. There were no borrowings outstanding on any of these facilities which are renewed automatically every three months. The Company also maintains relationships with other foreign banks for the issuance of letters of credit, letters of guarantee and performance bonds in a variety of foreign currencies. At March 31, 2017, the maximum U.S. dollar equivalent of the commitments was $83,376,000 of which $33,177,000 is outstanding. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2017 | |
Supplemental Cash Flow Information | |
Supplemental Cash Flow Information | Note 11 — Supplemental Cash Flow Information The following table provides additional cash flow information (in thousands): Three Months Ended March 31, 2017 2016 Interest and related financing fees paid $ $ Income taxes paid $ $ |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings per Share | |
Earnings per Share | Note 12 — Earnings per Share Basic earnings per common share have been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per common share incorporates the incremental shares issuable upon the assumed exercise of stock options using the treasury stock method, if dilutive. Dilutive stock options increased average common shares outstanding by 91,000 shares for the three-month period ended March 31, 2016. Options to purchase approximately 6,754,000 shares and 2,590,000 shares were excluded from the calculation of diluted earnings per share for the three-month periods ended March 31, 2017 and 2016, respectively, because they were antidilutive. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Share-Based Compensation | |
Share-Based Compensation | Note 13 — Share-Based Compensation At March 31, 2017, the Company had 6,517,473 options outstanding with a weighted average exercise price of $3.96. During the three months ended March 31, 2017, the Company granted 715,853 options which vest over a five-year period. The options have a weighted average exercise price of $4.98 and a weighted-average contractual life of 7.0 years. The aggregate fair value of the options was $1,412,500 calculated using the Black-Scholes valuation model. The weighted average assumptions used to calculate fair value were: expected life—5 years; volatility—48.30% and risk-free interest rate—2.08%. During the three months ended March 31, 2017, options for 1,165,200 shares with a weighted average exercise price of $5.55 lapsed and options for 95,000 shares with a weighted average exercise price of $4.40 were forfeited. During the three months ended March 31, 2017, employees purchased 13,104 common shares for an aggregate purchase price of approximately $49,000 pursuant to the Company’s 2008 Employee Stock Purchase Plan. The Company recognized share-based compensation expense in selling, general and administrative expenses in the consolidated statement of operations totaling $461,000 and $668,000 for the three months ended March 31, 2017 and 2016, respectively. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity | |
Stockholders' Equity | Note 14 — Stockholders’ Equity The following table summarizes the changes in stockholders’ equity during the three months ended March 31, 2017 (in thousands): Hill International, Noncontrolling Total Stockholders Interest (As restated) (As restated) (As restated) Stockholders’ equity, December 31, 2016 $ $ $ Net (loss) earnings ) ) Other comprehensive earnings ) ) Comprehensive (loss) earnings ) ) Additional paid in capital — Stockholders’ equity, March 31, 2017 $ $ $ |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Taxes | |
Income Taxes | Note 15 — Income Taxes The effective tax rates for the three months ended March 31, 2017 and 2016 were 40.1% and 8.8%, respectively. The Company’s effective tax rate represents the Company’s estimated tax rate for the year based on projected income and mix of income among the various foreign tax jurisdictions, adjusted for discrete transactions occurring during the period. The Company’s effective tax rate in both years is higher than it otherwise would be primarily as a result of not recording an income benefit related to the U.S. net operating loss. The components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions were as follows (in thousands): Three Months Ended March 31, 2017 Three Months Ended March 31, 2016 U.S. Foreign Total U.S. Foreign Total (As restated) (As restated) (Loss) earnings before income taxes $ ) $ $ $ ) $ $ Income tax expense, net $ — $ $ $ — $ $ The reserve for uncertain tax positions amounted to $6,757,000 and $6,735,000 at March 31, 2017 and December 31, 2016, respectively, and is included in “Other liabilities” in the consolidated balance sheet at those dates. The Company’s policy is to record income tax related interest and penalties in income tax expense. At both March 31, 2017 and December 31, 2016, potential interest and penalties related to uncertain tax positions amounting to $228,000 and $206,000 at March 31, 2017 and December 31, 2016, respectively, were included in the balance above. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income in making this assessment. Management evaluates the need for valuation allowances on the deferred tax assets according to the provisions of ASC 740, Income Taxes. They consider both positive and negative evidence. In making this determination, management assesses all of the evidence available at the time including recent earnings, internally-prepared income projections, and historical financial performance. |
Segment and Related Information
Segment and Related Information | 3 Months Ended |
Mar. 31, 2017 | |
Segment and Related Information | |
Segment and Related Information | Note 16 —Segment and Related Information At March 31, 2017, due to the pending sale of our Construction Claims Group (which was closed on May 5, 2017; see Note 19), the Company now has one operating segment, the Project Management Group, which reflects how the Company will be managed going forward. The Project Management Group provides extensive construction and project management services to construction owners worldwide. Such services include program management, project management, construction management, project management oversight, troubled project turnaround, staff augmentation, project labor agreement consulting, commissioning, estimating and cost management, labor compliance services and facilities management services. The information for 2016 has been revised to exclude the operations of the Construction Claims Group which is accounted for as discontinued operations. The following tables present certain information for the Project Management Group’s operations (in thousands): Revenue by Geographic Region Three Months Ended March 31, 2017 2016 (As restated) (As restated) United States/Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % For the quarter ended March 31, 2017, no other country, except for the United States, accounted for over 10% of consolidated total revenue. For the quarter ended March 31, 2016, total revenue for the United Arab Emirates amounted to $25,797,000 representing 18.8% of the total and Oman amounted to $14,002,000 representing 10.2% of consolidated total. No other country, except for the United States, accounted for over 10% of consolidated total revenue. Operating Profit (Loss) Three Months Ended March 31, 2017 2016 (As restated) (As restated) United States $ $ Latin America ) Europe Middle East Africa ) Asia/Pacific Corporate ) ) Total $ 4,114 $ Depreciation and Amortization Expense Three Months Ended March 31, 2017 2016 (As restated) (As restated) Project Management $ $ Corporate Total $ $ Revenue By Client Type Three Months Ended March 31, 2017 2016 (As restated) (As restated) U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Property, Plant and Equipment, Net, by Geographic Location March 31, 2017 December 31, 2016 (As restated) (As restated) United States/Canada $ $ Latin America Europe Middle East Africa Asia/Pacific Total $ $ |
Client Concentrations
Client Concentrations | 3 Months Ended |
Mar. 31, 2017 | |
Client Concentrations | |
Client Concentrations | Note 17—Client Concentrations The Company had no individual clients that accounted for 10% or more of total revenues during the three months ended March 31, 2017 and 2016. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 18 — Commitments and Contingencies General Litigation In 2013, M.A. Angeliades, Inc. (“Plaintiff”) filed a complaint with the Supreme Court of New York against the Company and the New York City Department of Design and Construction (“DDC”) regarding payment of approximately $8,771,000 for work performed as a subcontractor to the Company plus interest and other costs. On October 5, 2015, pursuant to a settlement agreement, Hill paid Plaintiff approximately $2,596,000, including interest amounting to $1,056,000, of which $448,000 had been previously accrued and $608,000 was charged to expense for the year ended December 31, 2015. The Plaintiff resolved its remaining issues regarding change orders and compensation for delay with DDC. On January 16, 2016, Plaintiff filed a Motion to amend its complaint against the Company claiming that the amounts paid by the Company do not reconcile with the amounts Plaintiff believes the Company received from DDC despite DDC’s records reflecting the same amount as the Company’s. The Plaintiff’s Motion was granted and the parties are currently engaged in mediation and discovery. Knowles Limited (“Knowles”), a subsidiary of the Company, is a party to an arbitration proceeding instituted on July 8, 2014 in which Knowles claimed that it was entitled to payment for services rendered to Celtic Bioenergy Limited (“Celtic”). The arbitrator decided in favor of Knowles. The arbitrator’s award was appealed by Celtic to the U.K. High Court of Justice, Queen’s Bench Division, Technology and Construction Court (“Court”). On March 16, 2017, the Court (1) determined that certain relevant facts had been deliberately withheld from the arbitrator by an employee of Knowles and (2) remitted the challenged parts of the arbitrator’s award back to the arbitrator to consider the award in possession of the full facts. The Company is evaluating the impact of the judgment of the Court. From time to time, the Company is a defendant or plaintiff in various legal actions which arise in the normal course of business. As such the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of probable losses. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. The provision may change in the future due to new developments or changes in circumstances. Changes in the provision could increase or decrease the Company’s earnings in the period the changes are made. It is the opinion of management, after consultation with legal counsel, that the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Acquisition-Related Contingencies As of March 31, 2017 our subsidiary, Hill International (Spain), S.A. (“Hill Spain”), owned an indirect 91% interest in Engineering S.A. (“ESA”), a firm located in Brazil. ESA’s shareholders entered into an agreement whereby the minority shareholders have a right to compel (“ESA Put Option”) Hill Spain to purchase any or all of their shares during the period from February 28, 2014 to February 28, 2021. Hill Spain also has the right to compel (“ESA Call Option”) the minority shareholders to sell any or all of their shares during the same time period. The purchase price for such shares shall be seven times the earnings before interest and taxes for ESA’s most recently ended fiscal year, net of any financial debt plus excess cash multiplied by a percentage which the shares to be purchased bear to the total number of shares outstanding at the time of purchase, but in the event the ESA Call Option is exercised by Hill Spain, the purchase price shall be increased by five percent. The ESA Put Option and the ESA Call Option must be made within three months after the audited financial statements of ESA have been completed. On June 17, 2016, the three remaining minority shareholders exercised their ESA Put Options claim a value of BRL 8,656,000 (approximately $2,670,000 at March 31, 2017). At that time, the Company accrued the liability in other current liabilities and as an adjustment to additional paid in capital. The amount is subject to negotiation and any difference will be recorded upon completion of the transaction. Other The Company has identified a potential tax liability related to certain foreign subsidiaries’ failure to comply with laws and regulations of the jurisdictions, outside of their home country, in which their employees provided services. The Company has estimated the potential liability to be approximately $2,545,000 of which approximately $410,000 has been included in discontinued operations in the consolidated statement of operations for the three months ended March 31, 2017. The potential liability balance is included in other liabilities in the consolidated balance sheet at March 31, 2017. In connection with the move of its corporate headquarters, the Commonwealth of Pennsylvania provided the Company with a $1,000,000 grant received on July 13, 2015. The terms of the grant require the Company to spend at least $6,425,000 on capital expenditures for leasehold improvements and equipment for its new headquarters, remain at One Commerce Square for at least seven-years and employ at least 359 persons no later than April 1, 2018. The Company has met the capital expenditure requirement and has a twelve-year lease for its corporate headquarters. Upon receipt of the funds, the Company recorded a deferred credit which, assuming the employment requirement is met, will be reflected in income in the second quarter of 2018. If the Company does not meet the employment criteria, it will be required to repay the grant to the Commonwealth of Pennsylvania. The terms of the agreement are currently under review.. The landlord for the new Philadelphia headquarters provided the Company with a tenant improvement allowance amounting to approximately $3,894,000. The tenant improvement allowance has been deferred, is included in other liabilities in the consolidated balance sheet at March 31, 2017 and December 31, 2016 and is being amortized on a straight-line basis against rent expense over the term of the twelve-year lease which commenced on May 1, 2015. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2017 | |
Subsequent Events | |
Subsequent Events | Note 19 — Subsequent Events Sale of Construction Claims Group On May 5, 2017, the Company closed the sale of its Construction Claims Group to two purchasers controlled by funds managed by Bridgepoint Development Capital for a total purchase price of $140,000,000 in cash less: (1) an estimated working capital adjustment at closing amounting to approximately $8,449,000; and (2) approximately $2,187,000 of assumed indebtedness. In addition, the Company was required to provide a $3,750,000 letter of credit into escrow in order to secure certain of the Company’s indemnification obligations for 12 months following closing. The funds provided by the sale of the Construction Claims Group and the cash received upon the draw down under the amended Revolving Credit Facilities (described below) were used as follows: (a) $117,000,000 to pay off the Term Loan Facility; (b) $25,000,000 to pay down the U.S. Revolver; (c) approximately $8,793,000 to pay down the International Revolver; and (d) approximately $1,214,000 to pay accrued interest and certain bank fees. The Company and the purchasers of the Construction Claims Group were unable to agree upon a final net working capital amount. Thus, pursuant to the terms of their agreement, they are participating in a dispute resolution process by which independent accounting experts will determine the final net working capital. Financing Transactions Simultaneously with the closing of the sale, the Company terminated its Term Loan Facility, amended its U.S. Revolver to reduce the amount available to the Company from $30,000,000 to $25,000,000, amended its International Revolver to reduce the amount available to the Company from $15,000,000 to $10,000,000, and drew approximately $25,191,000 in cash and approximately $9,193,000 in letters of credit against the new Revolving Credit Facilities. Deferred fees incurred with establishing the Secured Credit Facilities amounting to approximately $5,622,000 will be charged to discontinued operations in the quarter ending June 30, 2017. The U.S. Revolver and the International Revolver each have a term of five years from the closing and provide for letter of credit sub-limits in amounts of $20,000,000 and $8,000,000, respectively. The maximum Consolidated Net Leverage Ratio will be increased from the prior credit facilities to 3.00 for all test dates and will not decline. The definition of Consolidated Net Leverage Ratio was amended to (i) remove the cap on the amount of permitted cash netting and (ii) permit netting of unrestricted cash and cash equivalents. The Company incurred fees totaling $1,625,000 which will be deferred and amortized to interest expense over the five-year term of the facilities. As of the date of closing, the new facilities are substantially drawn. We intend to pursue additional borrowing options to improve our liquidity. Resignation of Chief Executive Officer Effective as of May 3, 2017, David L. Richter, the Company’s Chief Executive Officer and a member of the Company’s Board of Directors, tendered his resignation from all positions with the Company. In connection with his resignation, Mr. Richter and the Company entered into a Separation Agreement and General Release of Claims (the “Agreement). Under the Agreement, the Company agreed to (1) pay severance to Mr. Richter in the amount of $3,300,000, of which $1,100,000 was paid on May 9, 2017 and the remaining $2,200,000 will be paid in equal semi-monthly installments over the next two years; (2) pay unused vacation amounting to approximately $256,000; (3) accelerate the vesting of 1,000,000 options granted to Mr. Richter under the Company’s 2006 Employee Stock Option Plan for the purchase of shares of the Company’s common stock; the total vested options available to Mr. Richter are 2,100,000 with a remaining unrecognized compensation expense of $1,630,000; (4) pay COBRA premiums for a period 18 months; (5) reimburse Mr. Richter for the costs of operating one of his personal vehicles through September 1, 2017; and (6) terminate the lease of his other personal vehicle, purchase the vehicle and transfer title to Mr. Richter. The total cost of the benefits, including employment taxes, under the Agreement is estimated to be approximately $5,100,000 which will be charged to earnings from continuing operations in the second quarter of 2017. |
Restatement and Revision of P26
Restatement and Revision of Previously Reported Consolidated Financial Statements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |
Schedule of corrections of the misstatement on the Company's consolidated balance sheets and consolidated statements of income, comprehensive income (loss) and cash flows | Consolidated Balance Sheet March 31, 2017 As Adjustment As Restated Reference Assets Cash and cash equivalents $ $ — $ Cash - restricted — Accounts receivable, less allowance for doubtful accounts of $68,302 B Accounts receivable - affiliates — Prepaid expenses and other current assets — Income taxes receivable — Current assets held for sale — Total current assets Property and equipment, net ) C Cash - restricted, net of current portion — Retainage receivable — Acquired intangibles, net ) C Goodwill — Investments F Deferred income tax assets G Other assets — Assets held for sale ) C, F, G Total assets $ $ 377 $ Liabilities and Stockholders’ Equity Due to banks $ — $ — $ — Current maturities of notes payable and long-term debt — Accounts payable and accrued expenses F Income taxes payable G Current portion of deferred revenue — Other current liabilities F Current liabilities held for sale ) F, G Total current liabilities Notes payable and long-term debt, net of current maturities — Retainage payable — Deferred income taxes G Deferred revenue B Other liabilities D, E, F Liabilities held for sale D, F, G Total liabilities Commitments and contingencies Stockholders’ equity: Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued — — — Common stock, $0.0001 par value; 100,000 shares authorized, 58,848 shares issued at March 31, 2017 — Additional paid-in capital ) F Retained earnings (deficit) ) ) ) A, B, C, D, E, F, G Accumulated other comprehensive loss ) ) A, C, E, F, G ) Less treasury stock of 6,977 shares at December 31, 2016 ) — ) Hill International, Inc. share of equity ) Noncontrolling interests F Total equity ) Total liabilities and stockholders’ equity $ $ $ Consolidated Statement of Operations Three months ended March 31, 2017 As Adjustment As Restated Reference Revenues B, F Direct expenses F Gross Profit Selling, general and administrative expenses ) A, C, F Share of loss of equity method affiliates — Operating profit ) Interest and related financing fees, net F (Loss)earnings before income taxes ) Income tax expense G Loss from continuing operations ) Loss from discontinued operations ) ) C, F, G Net (loss) earnings ) ) Less: net earnings - noncontrolling interest F Net Loss attributiable to Hill International, Inc. $ ) $ $ ) Basic (loss)earnings per common share from continuing operations $ ) $ $ Basic loss per common share from discontinued operations ) ) Basic loss per common share - Hill International, Inc. $ ) $ $ ) Basic weighted average common shares outstanding — Diluted loss per common share from continuing operations $ ) $ $ Diluted loss per common share from discontinued operations ) ) Diluted loss per common share - Hill International, Inc. $ ) $ $ ) Basic weighted average common shares outstanding — Consolidated Statement of Operations Three months ended March 31, 2016 As Adjustment As Restated Reference Revenues B, F Direct expenses — Gross Profit Selling, general and administrative expenses ) A, C, F Share of loss of equity method affiliates ) — ) Operating profit Interest and related financing fees, net F (Loss)earnings before income taxes Income tax expense G Loss from continuing operations Loss from discontinued operations ) ) ) F Net (loss) earnings Less: net earnings - noncontrolling interest ) ) F Net Loss attributiable to Hill International, Inc. $ $ $ Basic loss per common share from continuing operations $ $ $ Basic loss per common share from discontinued operations ) ) ) Basic loss per common share - Hill International, Inc. $ $ $ Basic weighted average common shares outstanding — Diluted loss per common share from continuing operations $ $ $ Diluted loss per common share from discontinued operations ) ) ) Diluted loss per common share - Hill International, Inc. $ $ $ Basic weighted average common shares outstanding — Consolidated Statement of Comprehensive Loss Three months ended March 31, 2017 As Previously Adjustment As Restated Reference Net earnings $ ) $ ) A, B, C, F Foreign currency translation adjustment, net ) ) A, B, C, E, F, G Other, net — — — Comprehensive loss ) ) Comprehensive loss attributable to noncontrolling interest ) Comprehensive loss attributable to Hill International, Inc. $ ) $ ) Consolidated Statement of Comprehensive Income Three months ended March 31, 2016 As Previously Adjustment As Restated Reference Net earnings $ $ A, B, C, F, G Foreign currency translation adjustment, net ) ) A, B, C, E, F, G Other, net — Comprehensive loss Comprehensive loss attributable to noncontrolling interest ) ) A Comprehensive loss attributable to Hill International, Inc. $ $ Consolidated Statement of Cash Flows As Previously Adjustment As restated Cash flows from operating activities: Net (loss) earnings $ ) $ ) Loss from discontinued operations ) (Loss) earnings from continuing operations ) Adjustments to reconcile net (loss) earnings to net cash (used in): Depreciation and amortization Provision for bad debts ) — ) Amortization of deferred loan fees — Deferred tax benefit Stock based compensation ) Unrealized foreign exchange losses (gains) on intercompany balances — ) ) Changes in operating assets and liabilities: Restricted cash ) Accounts receivable ) ) ) Accounts receivable - affiliate ) ) Prepaid expenses and other current assets ) ) Income taxes receivable Retainage receivable ) ) Other assets ) ) ) Accounts payable and accrued expenses Income taxes payable ) ) Deferred revenue ) ) ) Other current liabilities ) Retainage payable Other liabilities ) Net cash used in continuing operations ) ) ) Net cash (used in) provided by discontinued operations ) ) Net cash used in operating activities ) ) ) Cash flows from investing activities: Purchase of businesses, net of cash aquired — ) ) Payments for purchase of property and equipment ) ) ) Net cash used in investing activities of continuing operations ) ) ) Net cash used in investing activities of discontinued operations ) — Net cash used in investing activities ) ) Cash flows from financing activities: Payments on term loans ) — ) Net borrowings on revolving loans ) Proceeds from stock issued under employee stock purchase plan — Net cash provided by financing activities ) Effect of exchange rate changes on cash Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents — beginning of period — Cash and cash equivalents — end of period $ — $ Consolidated Statement of Cash Flows As Previously Adjustment As restated Cash flows from operating activities: Net (loss) earnings $ $ Loss from discontinued operations (Loss) earnings from continuing operations Adjustments to reconcile net (loss) earnings to net cash (used in): Depreciation and amortization Provision for bad debts — Amortization of deferred loan fees — Deferred tax benefit Stock based compensation — Unrealized foreign exchange losses (gains) on intercompany balances — Changes in operating assets and liabilities: Restricted cash Accounts receivable ) ) ) Accounts receivable - affiliate ) ) ) Prepaid expenses and other current assets Income taxes receivable ) ) Retainage receivable ) — ) Other assets Accounts payable and accrued expenses ) ) Income taxes payable ) ) ) Deferred revenue ) Other current liabilities ) Retainage payable — Other liabilities ) Net cash (used in) provided by continuing operations ) Net cash (used in) provided by discontinued operations ) ) Net cash (used in) provided by operating activities ) Cash flows from investing activities: Purchase of businesses, net of cash aquired — ) ) Payments for purchase of property and equipment ) ) ) Net cash used in investing activities of continuing operations ) ) ) Net cash (used in) provided by investing activities of discontinued operations ) Net cash used in investing activities ) ) ) Cash flows from financing activities: Payments on term loans ) ) Net borrowings on revolving loans ) Proceeds from stock issued under employee stock purchase plan — Proceeds from exercise of stock options — Net cash provided by financing activities ) Effect of exchange rate changes on cash ) ) Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents — beginning of period — Cash and cash equivalents — end of period $ — $ |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations | |
Schedule of the carrying amounts of assets and liabilities and earnings related to discontinued operations | The carrying amounts of assets and liabilities of the discontinued operations which have been classified as held for sale are as follows (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Accounts receivable, net $ $ Prepaid expenses and other current assets Income taxes receivable Total current assets classified as held for sale $ $ Property and equipment, net Acquired intangibles, net Goodwill Investments Other assets Total non-current assets classified as held for sale $ $ Accounts payable and accrued expenses Income taxes payable Deferred revenue Other current liabilities Total current liabilities classified as held for sale $ $ Deferred income taxes Deferred revenue Retained Earnings Other liabilities Total non-current liabilities classified as held for sale $ $ The line items constituting earnings from discontinued operations consist of the following (in thousands): March 31, 2017 2016 (As restated) (As restated) Revenues $ $ Direct expenses Gross profit Selling, general and administrative expenses Operating (loss) profit ) Interest and related financing fees, net Loss before income taxes ) ) Income tax expense Net loss from discontinued operations $ ) $ ) |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Receivable | |
Schedule of components of accounts receivable | The components of accounts receivable are as follows (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Billed $ $ Retainage, current portion Unbilled Allowance for doubtful accounts ) ) Total $ $ |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Intangible Assets | |
Summary of acquired intangible assets | The following table summarizes the Company’s acquired intangible assets (in thousands): March 31, 2017 December 31, 2016 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization (As restated) (As restated) (As restated) (As restated) Client relationships $ $ $ $ Acquired contract rights Trade names Total $ $ $ $ Intangible assets, net $ $ |
Summary of amortization expense related to intangible assets | Amortization expense related to intangible assets was as follows (in thousands): Three Months Ended March 31, 2017 2016 (As restated) (As restated) $ $ |
Summary of estimated amortization expense of intangible assets for the next five years | The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands): Estimated Amortization Year ending December 31, Expense (As restated) 2017 (remaining 9 months) $ |
Goodwill (Tables)
Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill | |
Summary of changes in the Company's carrying value of goodwill | The following table summarizes the changes in the Company’s carrying value of goodwill during 2017 (in thousands): As restated Balance, December 31, 2016 $ Additions — Translation adjustments Balance, March 31, 2017 $ |
Accounts Payable and Accrued 31
Accounts Payable and Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Accrued Expenses | |
Schedule of components of accounts payable and accrued expenses | Below are the components of accounts payable and accrued expenses (in thousands): March 31, 2017 December 31, 2016 (As restated) (As restated) Accounts payable $ $ Accrued payroll and related expenses Accrued subcontractor fees Accrued agency fees Accrued legal and professional fees Other accrued expenses $ $ |
Notes Payable and Long-Term D32
Notes Payable and Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Notes Payable and Long-Term Debt | |
Summary of outstanding debt obligations | Outstanding debt obligations are as follows (in thousands): March 31, 2017 December 31, 2016 Term Loan Facility $ $ Domestic Revolving Credit Facility International Revolving Credit Facility Borrowings under revolving credit facilities with a consortium of banks in Spain Borrowings under revolving credit facilities with the National Bank of Abu Dhabi — Borrowings from Philadelphia Industrial Development Corporation Less current maturities Notes payable and long-term debt, net of current maturities $ $ |
Supplemental Cash Flow Inform33
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Supplemental Cash Flow Information | |
Schedule of additional cash flow information | The following table provides additional cash flow information (in thousands): Three Months Ended March 31, 2017 2016 Interest and related financing fees paid $ $ Income taxes paid $ $ |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity | |
Summary of changes in stockholders' equity | The following table summarizes the changes in stockholders’ equity during the three months ended March 31, 2017 (in thousands): Hill International, Noncontrolling Total Stockholders Interest (As restated) (As restated) (As restated) Stockholders’ equity, December 31, 2016 $ $ $ Net (loss) earnings ) ) Other comprehensive earnings ) ) Comprehensive (loss) earnings ) ) Additional paid in capital — Stockholders’ equity, March 31, 2017 $ $ $ |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Income Taxes | |
Schedule of components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions | The components of (loss) earnings before income taxes and the related income tax expense by the United States and foreign jurisdictions were as follows (in thousands): Three Months Ended March 31, 2017 Three Months Ended March 31, 2016 U.S. Foreign Total U.S. Foreign Total (As restated) (As restated) (Loss) earnings before income taxes $ ) $ $ $ ) $ $ Income tax expense, net $ — $ $ $ — $ $ |
Segment and Related Informati36
Segment and Related Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment and Related Information | |
Schedule of Revenue by Geographic Region | The following tables present certain information for the Project Management Group’s operations (in thousands): Revenue by Geographic Region Three Months Ended March 31, 2017 2016 (As restated) (As restated) United States/Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % |
Schedule of Operating Profit (Loss) | The following tables present certain information for the Project Management Group’s operations (in thousands): Operating Profit (Loss) Three Months Ended March 31, 2017 2016 (As restated) (As restated) United States $ $ Latin America ) Europe Middle East Africa ) Asia/Pacific Corporate ) ) Total $ 4,114 $ |
Schedule of Depreciation and Amortization Expense | The following tables present certain information for the Project Management Group’s operations (in thousands): Depreciation and Amortization Expense Three Months Ended March 31, 2017 2016 (As restated) (As restated) Project Management $ $ Corporate Total $ $ |
Schedule of Revenue By Client Type | The following tables present certain information for the Project Management Group’s operations (in thousands): Revenue By Client Type Three Months Ended March 31, 2017 2016 (As restated) (As restated) U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % |
Schedule of Property, Plant and Equipment, Net by Geographic Location | The following tables present certain information for the Project Management Group’s operations (in thousands): Property, Plant and Equipment, Net, by Geographic Location March 31, 2017 December 31, 2016 (As restated) (As restated) United States/Canada $ $ Latin America Europe Middle East Africa Asia/Pacific Total $ $ |
Restatement and Revision of P37
Restatement and Revision of Previously Reported Consolidated Financial Statements - (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Retained earnings (deficit) | $ (83,703,000) | $ (81,349,000) | |
Accumulated other comprehensive loss | (6,168,000) | (4,611,000) | |
Additional paid-in capital | 190,863,000 | 190,353,000 | |
Noncontrolling interest | 2,180,000 | 1,994,000 | |
Selling, general and administrative expenses | 33,463,000 | $ 37,793,000 | |
Revenues | 116,120,000 | 136,899,000 | |
Direct expenses | 78,509,000 | 93,301,000 | |
Accounts receivable | 167,289,000 | 164,844,000 | |
Property and equipment, net | 15,715,000 | 16,389,000 | |
Acquired intangibles, net | 5,474,000 | 6,006,000 | |
Non-current assets held for sale | 32,924,000 | 32,091,000 | |
Earnings from discontinued operations | (4,251,000) | (1,243,000) | (1,243,000) |
Other liabilities | 13,341,000 | 12,666,000 | |
Liabilities held for sale | 4,400,000 | 5,087,000 | |
Net earnings from noncontrolling interest | 119,000 | (11,000) | |
Investments | 4,421,000 | 3,501,000 | |
Accounts payable and accrued expenses | 87,993,000 | 85,680,000 | |
Other current liabilities | 8,592,000 | 8,157,000 | |
Current liabilities held for sale | 24,199,000 | 25,888,000 | |
Income taxes payable | 4,622,000 | 4,874,000 | |
Income tax expense | 1,349,000 | 456,000 | |
Deferred tax assets | 3,176,000 | 3,200,000 | |
Deferred income taxes | 629,000 | $ 560,000 | |
Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Retained earnings (deficit) | (58,969,000) | ||
Accumulated other comprehensive loss | 47,785,000 | ||
Additional paid-in capital | (93,000) | ||
Noncontrolling interest | 36,000 | ||
Selling, general and administrative expenses | (1,402,000) | (605,000) | |
Revenues | 8,551,000 | 2,529,000 | |
Direct expenses | 5,305,000 | ||
Accounts receivable | 821,000 | ||
Property and equipment, net | (458,000) | ||
Acquired intangibles, net | (722,000) | ||
Non-current assets held for sale | (429,000) | ||
Earnings from discontinued operations | 1,414,000 | (390,000) | |
Other liabilities | 3,075,000 | ||
Liabilities held for sale | 549,000 | ||
Net earnings from noncontrolling interest | 58,000 | (15,000) | |
Investments | 36,000 | ||
Accounts payable and accrued expenses | 1,243,000 | ||
Other current liabilities | 77,000 | ||
Current liabilities held for sale | (1,707,000) | ||
Income taxes payable | 858,000 | ||
Income tax expense | 695,000 | 290,000 | |
Deferred tax assets | 1,129,000 | ||
Deferred income taxes | 10,000 | ||
Construction Claims Group | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Interest Expense | 552,000 | 415,000 | |
Discontinued operations, interest expense | 552,000 | 415,000 | |
Correction for foreign currency gains (losses) | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Retained earnings (deficit) | (46,601,000) | ||
Accumulated other comprehensive loss | 46,601,000 | ||
Selling, general and administrative expenses | (1,813,000) | 206,000 | |
Correction for revenue recognition on long-term customer contracts | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Accumulated other comprehensive loss | 1,000 | ||
Revenues | 3,130,000 | 2,581,000 | |
Accounts receivable | 821,000 | ||
Deferred revenues | 7,513,000 | ||
Correction for impairment, useful lives, depreciation and amortization of assets | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Accumulated other comprehensive loss | 213,000 | ||
Selling, general and administrative expenses | 29,000 | 28,000 | |
Property and equipment, net | (458,000) | ||
Acquired intangibles, net | (722,000) | ||
Non-current assets held for sale | 567,000 | ||
Earnings from discontinued operations | 565,000 | ||
Correction for obligations not properly reconciled to the actuarial valuation and/or incorrect measurement date | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Other liabilities | (349,000) | ||
Liabilities held for sale | 458,000 | ||
Correction of incorrect tax entries | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Accumulated other comprehensive loss | 695,000 | ||
Other liabilities | 4,408,000 | ||
Correction for other transactions recorded to incorrect accounts and improper amounts | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Accumulated other comprehensive loss | 563,000 | ||
Additional paid-in capital | 329,000 | ||
Noncontrolling interest | 36,000 | ||
Selling, general and administrative expenses | 473,000 | (839,000) | |
Revenues | 5,421,000 | (52,000) | |
Direct expenses | 5,305,000 | ||
Non-current assets held for sale | 755,000 | ||
Earnings from discontinued operations | (1,057,000) | 390,000 | |
Other liabilities | (984,000) | ||
Liabilities held for sale | 1,738,000 | ||
Net earnings from noncontrolling interest | 58,000 | (15,000) | |
Investments | 36,000 | ||
Accounts payable and accrued expenses | 1,243,000 | ||
Other current liabilities | 77,000 | ||
Current liabilities held for sale | (1,915,000) | ||
Corrections for effect on earnings (loss) before taxes | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Retained earnings (deficit) | 235,000 | ||
Accumulated other comprehensive loss | (286,000) | ||
Non-current assets held for sale | (1,751,000) | ||
Liabilities held for sale | (1,647,000) | ||
Current liabilities held for sale | 208,000 | ||
Income taxes payable | 858,000 | ||
Income tax expense | 695,000 | $ 290,000 | |
Deferred tax assets | 1,129,000 | ||
Deferred income taxes | 10,000 | ||
Correction for forfeitures of stock based compensation plan | Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Retained earnings (deficit) | 422,000 | ||
Additional paid-in capital | (422,000) | ||
Selling, general and administrative expenses | $ (91,000) |
Restatement and Revision of P38
Restatement and Revision of Previously Reported Consolidated Financial Statements - Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Assets | ||
Cash and cash equivalents | $ 20,413 | $ 25,637 |
Cash - restricted | 3,544 | 4,312 |
Accounts receivable, less allowance for doubtful accounts of $68,302 | 167,289 | 164,844 |
Accounts receivable - affiliates | 7,335 | 5,712 |
Prepaid expenses and other current assets | 7,799 | 7,751 |
Income taxes receivable | 2,900 | 3,554 |
Current assets held for sale | 53,351 | 54,651 |
Total current assets | 262,631 | 266,461 |
Property and equipment, net | 15,715 | 16,389 |
Cash - restricted, net of current portion | 327 | 313 |
Retainage receivable | 17,775 | 17,225 |
Acquired intangibles, net | 5,474 | 6,006 |
Goodwill | 51,467 | 50,665 |
Investments | 4,421 | 3,501 |
Deferred income tax assets | 3,176 | 3,200 |
Other assets | 4,009 | 4,224 |
Assets held for sale | 32,924 | 32,091 |
Total assets | 397,919 | 400,075 |
Liabilities and Stockholders' Equity | ||
Current maturities of notes payable and long-term debt | 4,492 | 1,983 |
Accounts payable and accrued expenses | 87,993 | 85,680 |
Income taxes payable | 4,622 | 4,874 |
Current portion of deferred revenue | 5,094 | 12,943 |
Other current liabilities | 8,592 | 8,157 |
Current liabilities held for sale | 24,199 | 25,888 |
Total current liabilities | 134,992 | 139,525 |
Notes payable and long-term debt, net of current maturities | 150,808 | 142,120 |
Retainage payable | 1,000 | 961 |
Deferred income taxes | 629 | 560 |
Deferred revenue | 19,612 | 22,804 |
Other liabilities | 13,341 | 12,666 |
Liabilities held for sale | 4,400 | 5,087 |
Total liabilities | 324,782 | 323,723 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued | ||
Common stock, $0.0001 par value; 100,000 shares authorized, 58,848 shares issued at March 31, 2017 | 6 | 6 |
Additional paid-in capital | 190,863 | 190,353 |
Retained earnings (deficit) | (83,703) | (81,349) |
Accumulated other comprehensive loss | (6,168) | (4,611) |
Shareholders' equity before treasury stock and noncontrolling interests | 100,998 | 104,399 |
Less treasury stock of 6,977 shares at December 31, 2016 | (30,041) | (30,041) |
Hill International, Inc. share of equity | 70,957 | 74,358 |
Noncontrolling interests | 2,180 | 1,994 |
Total equity | 73,137 | 76,352 |
Total liabilities and stockholders' equity | 397,919 | $ 400,075 |
As Previously Reported | ||
Assets | ||
Cash and cash equivalents | 20,413 | |
Cash - restricted | 3,544 | |
Accounts receivable, less allowance for doubtful accounts of $68,302 | 166,468 | |
Accounts receivable - affiliates | 7,335 | |
Prepaid expenses and other current assets | 7,799 | |
Income taxes receivable | 2,900 | |
Current assets held for sale | 53,351 | |
Total current assets | 261,810 | |
Property and equipment, net | 16,173 | |
Cash - restricted, net of current portion | 327 | |
Retainage receivable | 17,775 | |
Acquired intangibles, net | 6,196 | |
Goodwill | 51,467 | |
Investments | 4,385 | |
Deferred income tax assets | 2,047 | |
Other assets | 4,009 | |
Assets held for sale | 33,353 | |
Total assets | 397,542 | |
Liabilities and Stockholders' Equity | ||
Current maturities of notes payable and long-term debt | 4,492 | |
Accounts payable and accrued expenses | 86,750 | |
Income taxes payable | 3,764 | |
Current portion of deferred revenue | 5,094 | |
Other current liabilities | 8,515 | |
Current liabilities held for sale | 25,906 | |
Total current liabilities | 134,521 | |
Notes payable and long-term debt, net of current maturities | 150,808 | |
Retainage payable | 1,000 | |
Deferred income taxes | 619 | |
Deferred revenue | 12,099 | |
Other liabilities | 10,266 | |
Liabilities held for sale | 3,851 | |
Total liabilities | 313,164 | |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock, $0.0001 par value; 100,000 shares authorized, 58,848 shares issued at March 31, 2017 | 6 | |
Additional paid-in capital | 190,956 | |
Retained earnings (deficit) | (24,734) | |
Accumulated other comprehensive loss | (53,953) | |
Shareholders' equity before treasury stock and noncontrolling interests | 112,275 | |
Less treasury stock of 6,977 shares at December 31, 2016 | (30,041) | |
Hill International, Inc. share of equity | 82,234 | |
Noncontrolling interests | 2,144 | |
Total equity | 84,378 | |
Total liabilities and stockholders' equity | 397,542 | |
Adjustment | ||
Assets | ||
Accounts receivable, less allowance for doubtful accounts of $68,302 | 821 | |
Total current assets | 821 | |
Property and equipment, net | (458) | |
Acquired intangibles, net | (722) | |
Investments | 36 | |
Deferred income tax assets | 1,129 | |
Assets held for sale | (429) | |
Total assets | 377 | |
Liabilities and Stockholders' Equity | ||
Accounts payable and accrued expenses | 1,243 | |
Income taxes payable | 858 | |
Other current liabilities | 77 | |
Current liabilities held for sale | (1,707) | |
Total current liabilities | 471 | |
Deferred income taxes | 10 | |
Deferred revenue | 7,513 | |
Other liabilities | 3,075 | |
Liabilities held for sale | 549 | |
Total liabilities | 11,618 | |
Commitments and contingencies | ||
Stockholders' equity: | ||
Additional paid-in capital | (93) | |
Retained earnings (deficit) | (58,969) | |
Accumulated other comprehensive loss | 47,785 | |
Shareholders' equity before treasury stock and noncontrolling interests | (11,277) | |
Hill International, Inc. share of equity | (11,277) | |
Noncontrolling interests | 36 | |
Total equity | (11,241) | |
Total liabilities and stockholders' equity | $ 377 |
Restatement and Revision of P39
Restatement and Revision of Previously Reported Consolidated Financial Statements - Consolidated Balance Sheet - Parenthetical (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Parenthetical | ||
Accounts receivable, allowance for doubtful accounts | $ 68,302 | $ 71,082 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 58,848 | 58,835 |
Treasury stock, shares | 6,977 | 6,977 |
Restatement and Revision of P40
Restatement and Revision of Previously Reported Consolidated Financial Statements - Consolidated Statement of Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Revenues | $ 116,120 | $ 136,899 | |
Direct expenses | 78,509 | 93,301 | |
Gross profit | 37,611 | 43,598 | |
Selling, general and administrative expenses | 33,463 | 37,793 | |
Share of loss of equity method affiliates | 34 | (15) | |
Operating profit | 4,114 | 5,820 | |
Interest and related financing fees, net | 749 | 628 | |
Earnings before income taxes | 3,365 | 5,192 | |
Income tax expense | 1,349 | 456 | |
Earnings from continuing operations | 2,016 | 4,736 | |
Loss from discontinued operations | (4,251) | (1,243) | $ (1,243) |
Net (loss) earnings | (2,235) | 3,493 | |
Less: net earnings (loss) - noncontrolling interests | 119 | (11) | |
Net (loss) earnings attributable to Hill International, Inc. | $ (2,354) | $ 3,504 | |
Basic (loss)earnings per common share from continuing operations | $ 0.04 | $ 0.09 | |
Basic loss per common share from discontinued operations | (0.09) | (0.02) | |
Basic (loss) earnings per common share - Hill International, Inc. | $ (0.05) | $ 0.07 | |
Basic weighted average common shares outstanding (in shares) | 51,860 | 51,631 | |
Diluted loss per common share from continuing operations | $ 0.04 | $ 0.09 | |
Diluted loss per common share from discontinued operations | (0.09) | (0.02) | |
Diluted (loss) earnings per common share - Hill International, Inc. | $ (0.05) | $ 0.07 | |
Diluted weighted average common shares outstanding (in shares) | 51,860 | 51,722 | |
As Previously Reported | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Revenues | $ 107,569 | $ 134,370 | |
Direct expenses | 73,204 | 93,301 | |
Gross profit | 34,365 | 41,069 | |
Selling, general and administrative expenses | 34,865 | 38,398 | |
Share of loss of equity method affiliates | 34 | (15) | |
Operating profit | (534) | 2,686 | |
Interest and related financing fees, net | 197 | 213 | |
Earnings before income taxes | (731) | 2,473 | |
Income tax expense | 654 | 166 | |
Earnings from continuing operations | (1,385) | 2,307 | |
Loss from discontinued operations | (5,665) | (853) | |
Net (loss) earnings | (7,050) | 1,454 | |
Less: net earnings (loss) - noncontrolling interests | 61 | 4 | |
Net (loss) earnings attributable to Hill International, Inc. | $ (7,111) | $ 1,450 | |
Basic (loss)earnings per common share from continuing operations | $ (0.03) | $ 0.04 | |
Basic loss per common share from discontinued operations | (0.11) | (0.01) | |
Basic (loss) earnings per common share - Hill International, Inc. | $ (0.14) | $ 0.03 | |
Basic weighted average common shares outstanding (in shares) | 51,860 | 51,631 | |
Diluted loss per common share from continuing operations | $ (0.03) | $ 0.04 | |
Diluted loss per common share from discontinued operations | (0.11) | (0.01) | |
Diluted (loss) earnings per common share - Hill International, Inc. | $ (0.14) | $ 0.03 | |
Diluted weighted average common shares outstanding (in shares) | 51,860 | 51,722 | |
Adjustment | |||
Restatement and Revision of Previously Reported Consolidated Financial Statements | |||
Revenues | $ 8,551 | $ 2,529 | |
Direct expenses | 5,305 | ||
Gross profit | 3,246 | 2,529 | |
Selling, general and administrative expenses | (1,402) | (605) | |
Operating profit | 4,648 | 3,134 | |
Interest and related financing fees, net | 552 | 415 | |
Earnings before income taxes | 4,096 | 2,719 | |
Income tax expense | 695 | 290 | |
Earnings from continuing operations | 3,401 | 2,429 | |
Loss from discontinued operations | 1,414 | (390) | |
Net (loss) earnings | 4,815 | 2,039 | |
Less: net earnings (loss) - noncontrolling interests | 58 | (15) | |
Net (loss) earnings attributable to Hill International, Inc. | $ 4,757 | $ 2,054 | |
Basic (loss)earnings per common share from continuing operations | $ 0.07 | $ 0.05 | |
Basic loss per common share from discontinued operations | 0.02 | (0.01) | |
Basic (loss) earnings per common share - Hill International, Inc. | 0.09 | 0.04 | |
Diluted loss per common share from continuing operations | 0.07 | 0.05 | |
Diluted loss per common share from discontinued operations | 0.02 | (0.01) | |
Diluted (loss) earnings per common share - Hill International, Inc. | $ 0.09 | $ 0.04 |
Restatement and Revision of P41
Restatement and Revision of Previously Reported Consolidated Financial Statements - Consolidated Statement of Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||
Net earnings | $ (2,235) | $ 3,493 |
Foreign currency translation adjustment, net | (1,558) | (3) |
Other, net | 34 | |
Comprehensive (loss) earnings | (3,793) | 3,524 |
Comprehensive loss attributable to noncontrolling interest | 119 | (11) |
Comprehensive (loss) earnings attributable to Hill International, Inc. | (3,912) | 3,535 |
As Previously Reported | ||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||
Net earnings | (7,050) | 1,454 |
Foreign currency translation adjustment, net | 440 | 434 |
Other, net | 34 | |
Comprehensive (loss) earnings | (6,610) | 1,922 |
Comprehensive loss attributable to noncontrolling interest | 128 | (752) |
Comprehensive (loss) earnings attributable to Hill International, Inc. | (6,738) | 2,674 |
Adjustment | ||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||
Net earnings | 4,815 | 2,039 |
Foreign currency translation adjustment, net | (1,998) | (437) |
Comprehensive (loss) earnings | 2,817 | 1,602 |
Comprehensive loss attributable to noncontrolling interest | (9) | 741 |
Comprehensive (loss) earnings attributable to Hill International, Inc. | $ 2,826 | $ 861 |
Restatement and Revision of P42
Restatement and Revision of Previously Reported Consolidated Financial Statements - Consolidated Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Cash flows from operating activities: | |||
Net (loss) earnings | $ (2,235) | $ 3,493 | |
Loss from discontinued operations | 4,251 | 1,243 | $ 1,243 |
Earnings from continuing operations | 2,016 | 4,736 | |
Adjustments to reconcile net (loss) earnings to net cash (used in): | |||
Depreciation and amortization | 1,595 | 1,906 | |
Provision for bad debts | (526) | 1,271 | |
Amortization of deferred loan fees | 444 | 444 | |
Deferred tax benefit | 452 | 4,387 | |
Stock based compensation | 461 | 668 | |
Unrealized foreign exchange losses (gains) on intercompany balances | (1,813) | 206 | |
Changes in operating assets and liabilities: | |||
Restricted cash | 736 | 397 | |
Accounts receivable | (2,617) | (9,161) | |
Accounts receivable - affiliate | (1,615) | (4,262) | |
Prepaid expenses and other current assets | (287) | 330 | |
Income taxes receivable | 1,366 | (281) | |
Retainage receivable | (310) | (281) | |
Other assets | (2,037) | 9,796 | |
Accounts payable and accrued expenses | 2,150 | (5,933) | |
Income taxes payable | (328) | (4,637) | |
Deferred revenue | (10,010) | 726 | |
Other current liabilities | 156 | 2,538 | |
Retainage payable | 39 | 266 | |
Other liabilities | 185 | 508 | |
Net cash (used in) provided by continuing operations | (9,943) | 3,624 | |
Net cash used in discontinued operations | (6,146) | (2,781) | |
Net cash (used in) provided by operating activities | (16,089) | 843 | |
Cash flows from investing activities: | |||
Purchase of businesses, net of cash acquired | (123) | (58) | |
Payments for purchase of property and equipment | (372) | (392) | |
Net cash used in investing activities of continuing operations | (495) | (450) | |
Net cash provided by investing activities of discontinued operations | 44 | ||
Net cash used in investing activities | (495) | (406) | |
Cash flows from financing activities: | |||
Payments on term loans | (314) | (348) | |
Net borrowings on revolving loans | 10,990 | 819 | |
Proceeds from stock issued under employee stock purchase plan | 49 | 10 | |
Proceeds from exercise of stock options | 86 | ||
Net cash provided by financing activities | 10,725 | 567 | |
Effect of exchange rate changes on cash | 635 | (4,058) | |
Net decrease in cash and cash equivalents | (5,224) | (3,054) | |
Cash and cash equivalents - beginning of period | 25,637 | 24,089 | 24,089 |
Cash and cash equivalents - end of period | 20,413 | 21,035 | 25,637 |
As Previously Reported | |||
Cash flows from operating activities: | |||
Net (loss) earnings | (7,050) | 1,454 | |
Loss from discontinued operations | 5,665 | 853 | |
Earnings from continuing operations | (1,385) | 2,307 | |
Adjustments to reconcile net (loss) earnings to net cash (used in): | |||
Depreciation and amortization | 1,566 | 1,878 | |
Provision for bad debts | (526) | 1,271 | |
Amortization of deferred loan fees | 444 | 444 | |
Deferred tax benefit | 93 | 749 | |
Stock based compensation | 552 | 668 | |
Changes in operating assets and liabilities: | |||
Restricted cash | 812 | 378 | |
Accounts receivable | (1,308) | (1,897) | |
Accounts receivable - affiliate | (1,621) | (4,149) | |
Prepaid expenses and other current assets | 61 | 18 | |
Income taxes receivable | 732 | (292) | |
Retainage receivable | (550) | (281) | |
Other assets | (337) | 3,979 | |
Accounts payable and accrued expenses | 1,544 | (6,558) | |
Income taxes payable | (1,129) | (3,867) | |
Deferred revenue | (8,721) | (2,533) | |
Other current liabilities | 257 | 3,633 | |
Retainage payable | 38 | 266 | |
Other liabilities | 513 | (995) | |
Net cash (used in) provided by continuing operations | (8,965) | (4,981) | |
Net cash used in discontinued operations | (6,554) | 368 | |
Net cash (used in) provided by operating activities | (15,519) | (4,613) | |
Cash flows from investing activities: | |||
Payments for purchase of property and equipment | (241) | (141) | |
Net cash used in investing activities of continuing operations | (241) | (141) | |
Net cash provided by investing activities of discontinued operations | (458) | (31) | |
Net cash used in investing activities | (699) | (172) | |
Cash flows from financing activities: | |||
Payments on term loans | (314) | (314) | |
Net borrowings on revolving loans | 10,997 | 1,202 | |
Proceeds from stock issued under employee stock purchase plan | 49 | 10 | |
Proceeds from exercise of stock options | 86 | ||
Net cash provided by financing activities | 10,732 | 984 | |
Effect of exchange rate changes on cash | 262 | 747 | |
Net decrease in cash and cash equivalents | (5,224) | (3,054) | |
Cash and cash equivalents - beginning of period | 25,637 | 24,089 | 24,089 |
Cash and cash equivalents - end of period | 20,413 | 21,035 | $ 25,637 |
Adjustment | |||
Cash flows from operating activities: | |||
Net (loss) earnings | 4,815 | 2,039 | |
Loss from discontinued operations | (1,414) | 390 | |
Earnings from continuing operations | 3,401 | 2,429 | |
Adjustments to reconcile net (loss) earnings to net cash (used in): | |||
Depreciation and amortization | 29 | 28 | |
Deferred tax benefit | 359 | 3,638 | |
Stock based compensation | (91) | ||
Unrealized foreign exchange losses (gains) on intercompany balances | (1,813) | 206 | |
Changes in operating assets and liabilities: | |||
Restricted cash | (76) | 19 | |
Accounts receivable | (1,309) | (7,264) | |
Accounts receivable - affiliate | 6 | (113) | |
Prepaid expenses and other current assets | (348) | 312 | |
Income taxes receivable | 634 | 11 | |
Retainage receivable | 240 | ||
Other assets | (1,700) | 5,817 | |
Accounts payable and accrued expenses | 606 | 625 | |
Income taxes payable | 801 | (770) | |
Deferred revenue | (1,289) | 3,259 | |
Other current liabilities | (101) | (1,095) | |
Retainage payable | 1 | ||
Other liabilities | (328) | 1,503 | |
Net cash (used in) provided by continuing operations | (978) | 8,605 | |
Net cash used in discontinued operations | 408 | (3,149) | |
Net cash (used in) provided by operating activities | (570) | 5,456 | |
Cash flows from investing activities: | |||
Purchase of businesses, net of cash acquired | (123) | (58) | |
Payments for purchase of property and equipment | (131) | (251) | |
Net cash used in investing activities of continuing operations | (254) | (309) | |
Net cash provided by investing activities of discontinued operations | 458 | 75 | |
Net cash used in investing activities | 204 | (234) | |
Cash flows from financing activities: | |||
Payments on term loans | 1,133 | ||
Net borrowings on revolving loans | (7) | (1,550) | |
Net cash provided by financing activities | (7) | (417) | |
Effect of exchange rate changes on cash | $ 373 | $ (4,805) |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | May 05, 2017 | |
Current assets classified as held for sale | ||||
Accounts receivable, net | $ 48,580,000 | $ 50,892,000 | ||
Prepaid expenses and other current assets | 2,775,000 | 3,064,000 | ||
Income taxes receivable | 1,996,000 | 695,000 | ||
Total current assets classified as held for sale | 53,351,000 | 54,651,000 | ||
Non-current assets classified as held for sale | ||||
Property and equipment, net | 4,907,000 | 4,617,000 | ||
Acquired intangibles, net | 3,500,000 | 3,397,000 | ||
Goodwill | 23,907,000 | 23,461,000 | ||
Investments | 7,000 | 6,000 | ||
Other assets | 603,000 | 610,000 | ||
Total non-current assets classified as held for sale | 32,924,000 | 32,091,000 | ||
Current liabilities classified as held for sale | ||||
Accounts payable and accrued expenses | 20,329,000 | 21,539,000 | ||
Income taxes payable | 8,000 | 92,000 | ||
Deferred revenue | 1,684,000 | 1,562,000 | ||
Other current liabilities | 2,178,000 | 2,695,000 | ||
Total current liabilities classified as held for sale | 24,199,000 | 25,888,000 | ||
Non-current liabilities classified as held for sale | ||||
Deferred income taxes | 599,000 | 385,000 | ||
Deferred revenue | 437,000 | 1,012,000 | ||
Retained Earnings | 457,000 | 457,000 | ||
Other liabilities | 2,907,000 | 3,233,000 | ||
Total non-current liabilities classified as held for sale | 4,400,000 | 5,087,000 | ||
Details of earnings from discontinued operations | ||||
Revenue | 44,030,000 | 41,851,000 | ||
Direct expenses | 21,994,000 | 19,678,000 | ||
Gross profit | 22,036,000 | 22,173,000 | ||
Selling, general and administrative expenses | 22,960,000 | 20,132,000 | ||
Operating (loss) profit | (924,000) | 2,041,000 | ||
Interest and related financing fees, net | 3,095,000 | 2,769,000 | ||
Loss before income taxes | (4,019,000) | (728,000) | ||
Income tax expense | 232,000 | 515,000 | ||
Net loss from discontinued operations | (4,251,000) | $ (1,243,000) | $ (1,243,000) | |
Potential tax liability related to certain foreign subsidiaries | 400,000 | |||
Construction Claims Group | ||||
Details of earnings from discontinued operations | ||||
Expenses related to the sale of discontinued operations | $ 1,600,000 | |||
Subsequent event | Construction Claims Group | Discontinued operations, Sold | ||||
Details of assets and liabilities and earnings related to discontinued operations | ||||
Discontinued operation, consideration | $ 140,000,000 |
Liquidity (Details)
Liquidity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | 51 Months Ended | |||
Oct. 31, 2014 | Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2017 | Dec. 31, 2012 | |
Revenues | $ 116,120,000 | $ 136,899,000 | |||||
Accounts receivable, allowance for doubtful accounts | 68,302,000 | $ 71,082,000 | $ 68,302,000 | ||||
Middle East and Africa | |||||||
Revenues | 51,491,000 | ||||||
Libya | |||||||
Accounts receivable | $ 59,937,000 | ||||||
Collection amount applied to receivables | 9,511,000 | ||||||
Iraq | |||||||
Accounts receivable, allowance for doubtful accounts | 2,777,000 | 2,777,000 | |||||
Accounts receivable written off | 3,593,000 | ||||||
Oman | |||||||
Revenues | $ 14,002,000 | ||||||
Extension period for the completion of the project | 12 months | ||||||
Accounts receivable | 29,200,000 | 29,200,000 | |||||
Collection amount applied to receivables | $ 12,728,000 | $ 42,000,000 | |||||
Accounts receivable, past due | $ 18,700,000 | $ 18,700,000 |
Accounts Receivable - Component
Accounts Receivable - Components of Accounts Receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Components of accounts receivable | ||
Billed | $ 191,243 | $ 200,134 |
Retainage, current portion | 11,242 | 10,824 |
Unbilled | 33,106 | 24,968 |
Accounts receivable, gross | 235,591 | 235,926 |
Allowance for doubtful accounts | (68,302) | (71,082) |
Total | $ 167,289 | $ 164,844 |
Accounts Receivable - General (
Accounts Receivable - General (Details) - MOTC - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |
Apr. 30, 2017 | Oct. 31, 2014 | Mar. 31, 2017 | Dec. 31, 2016 | |
Accounts Receivable | ||||
Extension period for the completion of the project | 12 months | |||
Collection amount applied to receivables | $ 12,728,000 | $ 42,000,000 | ||
Accounts receivable | $ 29,200,000 | |||
Accounts receivable, past due | 18,700,000 | |||
Retainage receivable included in non-current Retainage Receivable | 17,000,000 | |||
Retention amount | 8,400,000 | |||
Amount of retainage receivable relating to Defect and Liability Period | $ 8,600,000 | |||
Percentage of monthly invoice retained | 5.00% | |||
Percentage of retention released after one year from commencement of DLP | 50.00% | |||
Period after commencement of DLP for release of retention | 1 year | |||
Maximum period of DLP | 24 months |
Intangible Assets - Acquired (D
Intangible Assets - Acquired (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of acquired intangible assets | ||
Gross Carrying Amount | $ 19,831 | $ 19,716 |
Accumulated Amortization | 14,357 | 13,710 |
Intangible assets, net | 5,474 | 6,006 |
Client relationship | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 16,859 | 16,699 |
Accumulated Amortization | 11,931 | 11,298 |
Contract | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 2,005 | 2,058 |
Accumulated Amortization | 1,901 | 1,912 |
Trade name | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 967 | 959 |
Accumulated Amortization | $ 525 | $ 500 |
Intangible Assets - Amortizatio
Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Intangible Assets | ||
Amortization expense related to intangible assets | $ 559 | $ 872 |
Estimated amortization expense of intangible assets for the next five years | ||
2017 (remaining 9 months) | 1,529 | |
2,018 | 1,005 | |
2,019 | 1,001 | |
2,020 | 739 | |
2,021 | $ 342 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2017USD ($) | |
Summary of changes in carrying value of goodwill during 2017 | |
Balance at the beginning of the period | $ 50,665 |
Translation adjustments | 802 |
Balance at the end of the period | $ 51,467 |
Accounts Payable and Accrued 50
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Components of accounts payable and accrued expenses | ||
Accounts payable | $ 29,808 | $ 30,944 |
Accrued payroll and related expenses | 34,616 | 32,618 |
Accrued subcontractor fees | 11,012 | 9,188 |
Accrued agency fees | 5,742 | 5,702 |
Accrued legal and professional fees | 2,476 | 2,223 |
Other accrued expenses | 4,339 | 5,005 |
Accounts payable and accrued expenses, net | $ 87,993 | $ 85,680 |
Notes Payable and Long-Term D51
Notes Payable and Long-Term Debt - Summary of Outstanding Debt Obligations (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Summary of outstanding debt obligations | ||
Long-term debt, total | $ 155,300 | $ 144,103 |
Less current maturities | 4,492 | 1,983 |
Notes payable and long-term debt, net of current maturities | 150,808 | 142,120 |
Term loan payable | Philadelphia Industrial Development Corporation | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | 642 | 655 |
Revolving credit facility | Consortium of banks in Spain | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | 2,835 | 2,962 |
Revolving credit facility | National Bank of Abu Dhabi | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | 2,671 | |
Secured Credit Facilities | Term loan payable | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | 112,878 | 112,884 |
Secured Credit Facilities | U.S. Revolver | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | 25,000 | 16,500 |
Secured Credit Facilities | International Revolver | ||
Summary of outstanding debt obligations | ||
Long-term debt, total | $ 11,274 | $ 11,102 |
Notes Payable and Long-Term D52
Notes Payable and Long-Term Debt - Term Loan Facilities and Revolving Credit Facilities (Details) | Sep. 26, 2014EUR (€) | Mar. 31, 2017USD ($) | Mar. 31, 2017EUR (€) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 26, 2014USD ($) |
Revolving credit facility | Foreign credit agreements | ||||||
Notes Payable and Long-Term Debt | ||||||
Letters of credit outstanding | $ 909,000 | |||||
Available borrowing capacity | 1,604,000 | |||||
Secured Credit Facilities | ||||||
Notes Payable and Long-Term Debt | ||||||
Cash excluded from consolidated net leverage ratio | $ 10,000,000 | |||||
Debt instrument increase in applicable interest rate for exceeding the consolidated net leverage ratio, as a percent | 2.00% | |||||
Debt instrument increase in applicable interest rate for past due account receivable limit exceeded | 2.00% | 2.00% | ||||
Consent fee for default and increase in interest rate of debt | $ 401,000 | |||||
Secured Credit Facilities | Term loan payable | ||||||
Notes Payable and Long-Term Debt | ||||||
Aggregate principal amount | $ 120,000,000 | |||||
Increase in applicable interest rate upon default (as a percent) | 2.00% | |||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement and maintenance of certain metrics | 50.00% | |||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement net leverage ration is equal to or less than 2.25 | 25.00% | |||||
Consolidated net leverage limit for mandatory prepayment percentage of 25% | 2.25 | |||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement net leverage ration is equal to or less than 1.50 | 0.00% | |||||
Consolidated net leverage limit for mandatory prepayment percentage of 0% | 1.50 | |||||
Term of debt | 6 years | |||||
Quarterly principal payment, percentage | 0.25% | 0.25% | ||||
Deferred financing fees | $ 7,066,000 | |||||
Debt issuance costs amortization term | 6 years | |||||
Unamortized balances of expenses and fees | 4,122,000 | $ 4,416,000 | ||||
Effective interest rate (as a percent) | 7.75% | |||||
Secured Credit Facilities | Term loan payable | British Bankers Association LIBOR Rate | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 6.75% | |||||
Secured Credit Facilities | Term loan payable | British Bankers Association LIBOR Rate | Minimum | ||||||
Notes Payable and Long-Term Debt | ||||||
Interest rate (as a percent) | 1.00% | 1.00% | ||||
Secured Credit Facilities | Term loan payable | One Month LIBOR | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 1.00% | |||||
Secured Credit Facilities | Term loan payable | One Month LIBOR | Minimum | ||||||
Notes Payable and Long-Term Debt | ||||||
Interest rate (as a percent) | 1.00% | 1.00% | ||||
Secured Credit Facilities | Term loan payable | Base Rate | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 5.75% | |||||
Secured Credit Facilities | Term loan payable | Federal Funds Rate | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 0.50% | |||||
Secured Credit Facilities | Revolving credit facility | ||||||
Notes Payable and Long-Term Debt | ||||||
Term of debt | 5 years | |||||
Deferred financing fees | $ 3,000,000 | |||||
Debt issuance costs amortization term | 5 years | |||||
Secured Credit Facilities | U.S. Revolver | ||||||
Notes Payable and Long-Term Debt | ||||||
Maximum borrowing capacity | 30,000,000 | 30,000,000 | ||||
Effective interest rate (as a percent) | 6.75% | |||||
Unused facility commitment fees percentage | 0.50% | |||||
Percentage of eligible receivables that are subject to a perfected security interest which are used in calculation of borrowing base | 85.00% | |||||
Available borrowing capacity | 530,000 | |||||
Secured Credit Facilities | U.S. Revolver | Letters of credit | ||||||
Notes Payable and Long-Term Debt | ||||||
Maximum borrowing capacity | 25,000,000 | |||||
Letters of credit outstanding | 4,470,000 | |||||
Secured Credit Facilities | U.S. Revolver | British Bankers Association LIBOR Rate | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 3.75% | |||||
Secured Credit Facilities | U.S. Revolver | Base Rate | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 2.75% | |||||
Secured Credit Facilities | International Revolver | ||||||
Notes Payable and Long-Term Debt | ||||||
Maximum borrowing capacity | € 11,765,000 | € 11,765,000 | 12,573,000 | 15,000,000 | ||
Effective interest rate (as a percent) | 3.60% | |||||
Unused facility commitment fees percentage | 0.75% | |||||
Percentage of eligible receivables that are subject to a perfected security interest which are used in calculation of borrowing base | 85.00% | |||||
Percentage of eligible receivables that are not subject to a perfected security interest which are used in calculation of borrowing base | 10.00% | |||||
Secured Credit Facilities | International Revolver | Letters of credit | ||||||
Notes Payable and Long-Term Debt | ||||||
Maximum borrowing capacity | $ 10,000,000 | |||||
Secured Credit Facilities | International Revolver | EURIBOR | ||||||
Notes Payable and Long-Term Debt | ||||||
Basis of effective interest rate (as a percent) | 4.00% | |||||
Secured Credit Facilities | Other Assets | Revolving credit facility | ||||||
Notes Payable and Long-Term Debt | ||||||
Unamortized balances of expenses and fees | $ 1,500,000 | $ 1,650,000 | ||||
Non Permitted Country | Secured Credit Facilities | Maximum | ||||||
Notes Payable and Long-Term Debt | ||||||
Percentage of receivables more than 120 days old | 10.00% | 10.00% | ||||
United Arab Emirates | Secured Credit Facilities | Maximum | ||||||
Notes Payable and Long-Term Debt | ||||||
Percentage of receivables more than 120 days old | 14.00% | 14.00% |
Notes Payable and Long-Term D53
Notes Payable and Long-Term Debt - Other Debt Arrangements (Details) | Dec. 17, 2016item | Dec. 16, 2016EUR (€)item | Mar. 31, 2017USD ($)loanfacilityitem | Mar. 31, 2017AED (د.إ) | Mar. 31, 2017EUR (€) | Mar. 31, 2017BRL (R$) | Mar. 31, 2017USD ($) |
Other Foreign Banks | |||||||
Description of terms of credit agreement | |||||||
Maximum borrowing capacity | $ 83,376,000 | ||||||
Letters of credit outstanding | 33,177,000 | ||||||
Term loan payable | Philadelphia Industrial Development Corporation | |||||||
Description of terms of credit agreement | |||||||
Aggregate principal amount | $ 750,000 | ||||||
Interest rate (as a percent) | 2.75% | 2.75% | 2.75% | 2.75% | |||
Term of debt | 144 months | ||||||
Amount payable in each installment | $ 6,121 | ||||||
Revolving credit facility | National Bank of Abu Dhabi | |||||||
Description of terms of credit agreement | |||||||
Maximum borrowing capacity | د.إ 11,500,000 | $ 3,131,000 | |||||
Amounts outstanding | 9,811,000 | 2,671,000 | |||||
Revolving credit facility | National Bank of Abu Dhabi | Letters of credit | |||||||
Description of terms of credit agreement | |||||||
Maximum borrowing capacity | 200,000,000 | 54,451,000 | |||||
Letters of credit outstanding | د.إ 99,180,000 | $ 27,002,000 | |||||
Revolving credit facility | National Bank of Abu Dhabi | Emirates InterBank Offer Rate | |||||||
Description of terms of credit agreement | |||||||
Reference rate | one-month Emirates InterBank Offer Rate | ||||||
Basis of effective interest rate (as a percent) | 3.50% | ||||||
Effective interest rate (as a percent) | 4.91% | ||||||
Revolving credit facility | National Bank of Abu Dhabi | Emirates InterBank Offer Rate | Minimum | |||||||
Description of terms of credit agreement | |||||||
Interest rate (as a percent) | 5.50% | 5.50% | 5.50% | 5.50% | |||
Engineering S.A. | Revolving credit facility | |||||||
Description of terms of credit agreement | |||||||
Number of revolving credit lines maintained by Engineering S.A. | item | 4 | ||||||
Number of banks involved in revolving credit facility | loanfacility | 2 | ||||||
Maximum borrowing capacity | R$ 2380000 | $ 755,000 | |||||
Amounts outstanding | R$ 0 | $ 0 | |||||
Weighted average interest rate (as a percent) | 5.07% | 5.07% | 5.07% | 5.07% | |||
Period of automatic renewal | 3 months | ||||||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | |||||||
Description of terms of credit agreement | |||||||
Interest rate (as a percent) | 6.50% | ||||||
Number of banks involved in revolving credit facility | item | 3 | 6 | |||||
Maximum borrowing capacity | € 5,640,000 | € 2,623,000 | $ 2,803,000 | ||||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | Minimum | |||||||
Description of terms of credit agreement | |||||||
Interest rate (as a percent) | 1.85% | 1.85% | 1.85% | 1.85% | |||
Term of debt | 36 months | ||||||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | Maximum | |||||||
Description of terms of credit agreement | |||||||
Interest rate (as a percent) | 3.50% | 3.50% | 3.50% | 3.50% | |||
Term of debt | 60 months | ||||||
Hill Spain | ICO loan | Bankia Bank | |||||||
Description of terms of credit agreement | |||||||
Interest rate (as a percent) | 6.50% | 6.50% | 6.50% | 6.50% | |||
Maximum borrowing capacity | € 30,000 | $ 32,000 | |||||
Decrease in amount on quarterly basis | € | € 15,000 |
Supplemental Cash Flow Inform54
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Summary of additional cash flow information | ||
Interest and related financing fees paid | $ 3,500 | $ 3,003 |
Income taxes paid | $ 1,194 | $ 2,956 |
Earnings per Share (Details)
Earnings per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings per Share | ||
Dilutive stock options (in shares) | 91,000 | |
Total number of shares excluded from diluted earnings per common share | 6,754,000 | 2,590,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Share-Based Compensation | ||
Aggregate fair value of options granted (in dollars) | $ 1,412,500 | |
Compensation expense | $ 461,000 | $ 668,000 |
Weighted average assumptions used to estimate the fair value of options granted | ||
Average expected life | 5 years | |
Volatility (as a percent) | 48.30% | |
Weighted average risk-free interest rate (as a percent) | 2.08% | |
Exercise price of $3.96 | ||
Share-Based Compensation | ||
Options outstanding (in shares) | 6,517,473 | |
Weighted average exercise price of outstanding options (in dollars per share) | $ 3.96 | |
Exercise price of $ | ||
Share-Based Compensation | ||
Weighted average exercise price of options granted (in dollars per share) | $ 4.98 | |
Weighted-average contractual life | 7 years | |
Weighted average exercise price of $5.55 | ||
Share-Based Compensation | ||
Options lapsed (in shares) | 1,165,200 | |
Weighted average exercise price of options lapsed (in dollars per share) | $ 5.55 | |
Weighted average exercise price of $4.40 | ||
Share-Based Compensation | ||
Options forfeited (in shares) | 95,000 | |
Weighted average exercise price of options forfeited (in dollars per share) | $ 4.40 | |
2008 Employee Stock Purchase Plan | ||
Share-Based Compensation | ||
Shares purchased | 13,104 | |
Aggregate purchase price | $ 49,000 | |
Options vesting over a five-year period | Exercise price of $ | ||
Share-Based Compensation | ||
Options granted (in shares) | 715,853 | |
Award vesting period | 5 years |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Increase (decrease) in stockholders' equity | ||
Stockholders' equity, balance at the beginning of the period | $ 76,352 | |
Net (loss) earnings | (2,235) | $ 3,493 |
Other comprehensive earnings | (1,490) | |
Comprehensive (loss) earnings | (3,725) | |
Additional paid in capital | 510 | |
Stockholders' equity, balance at the end of the period | 73,137 | |
Hill International, Inc. Stockholders | ||
Increase (decrease) in stockholders' equity | ||
Stockholders' equity, balance at the beginning of the period | 74,358 | |
Net (loss) earnings | (2,354) | |
Other comprehensive earnings | (1,557) | |
Comprehensive (loss) earnings | (3,911) | |
Additional paid in capital | 510 | |
Stockholders' equity, balance at the end of the period | 70,957 | |
Non-controlling Interests | ||
Increase (decrease) in stockholders' equity | ||
Stockholders' equity, balance at the beginning of the period | 1,994 | |
Net (loss) earnings | 119 | |
Other comprehensive earnings | 67 | |
Comprehensive (loss) earnings | 186 | |
Stockholders' equity, balance at the end of the period | $ 2,180 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Dec. 31, 2016 | |
Effective income tax rate (as a percent) | 40.10% | 8.80% | |
Components of (loss) earnings before income taxes | |||
(Loss) earnings before income taxes | $ 3,365,000 | $ 5,192,000 | |
Income tax expense, net | 1,349,000 | 456,000 | |
Potential interest and penalties related to uncertain tax positions | 228,000 | $ 206,000 | |
Other liabilities | |||
Components of (loss) earnings before income taxes | |||
Reserve for uncertain tax positions | 6,757,000 | $ 6,735,000 | |
Federal | |||
Components of (loss) earnings before income taxes | |||
(Loss) earnings before income taxes | (5,475,000) | (6,147,000) | |
Foreign | |||
Components of (loss) earnings before income taxes | |||
(Loss) earnings before income taxes | 8,840,000 | 11,339,000 | |
Income tax expense, net | $ 1,349,000 | $ 456,000 |
Segment and Related Informati59
Segment and Related Information - Revenue by Geographic Region (Details) | 3 Months Ended | |
Mar. 31, 2017USD ($)segment | Mar. 31, 2016USD ($) | |
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Number of reporting units | segment | 1 | |
Revenues | $ 116,120,000 | $ 136,899,000 |
Revenues (as a percent) | 100.00% | 100.00% |
U.S./Canada | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 48,736,000 | $ 45,240,000 |
Revenues (as a percent) | 42.00% | 33.00% |
Latin America | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 3,043,000 | $ 5,207,000 |
Revenues (as a percent) | 2.60% | 3.80% |
Europe | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 10,190,000 | $ 9,764,000 |
Revenues (as a percent) | 8.80% | 7.10% |
Middle East | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 45,776,000 | $ 65,656,000 |
Revenues (as a percent) | 39.40% | 48.00% |
Africa | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 5,715,000 | $ 6,395,000 |
Revenues (as a percent) | 4.90% | 4.70% |
Asia/Pacific | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 2,660,000 | $ 4,637,000 |
Revenues (as a percent) | 2.30% | 3.40% |
United Arab Emirates | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 25,797,000 | |
Revenues (as a percent) | 18.80% | |
Oman | ||
Consulting Fee Revenue and Total Revenue by Geographic Region: | ||
Revenues | $ 14,002,000 | |
Revenues (as a percent) | 10.20% |
Segment and Related Informati60
Segment and Related Information - Operating Profit (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Profit (Loss) | ||
Operating profit (loss) | $ 4,114 | $ 5,820 |
Operating segment | U.S. | ||
Operating Profit (Loss) | ||
Operating profit (loss) | 4,274 | 2,829 |
Operating segment | Latin America | ||
Operating Profit (Loss) | ||
Operating profit (loss) | (373) | 895 |
Operating segment | Europe | ||
Operating Profit (Loss) | ||
Operating profit (loss) | 1,416 | 1,514 |
Operating segment | Middle East | ||
Operating Profit (Loss) | ||
Operating profit (loss) | 6,802 | 10,542 |
Operating segment | Africa | ||
Operating Profit (Loss) | ||
Operating profit (loss) | 780 | (2,149) |
Operating segment | Asia/Pacific | ||
Operating Profit (Loss) | ||
Operating profit (loss) | 124 | 737 |
Corporate | ||
Operating Profit (Loss) | ||
Operating profit (loss) | $ (8,909) | $ (8,548) |
Segment and Related Informati61
Segment and Related Information - Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Depreciation and Amortization Expense | ||
Depreciation and amortization expense | $ 1,595 | $ 1,906 |
Operating segment | Project Management | ||
Depreciation and Amortization Expense | ||
Depreciation and amortization expense | 1,522 | 1,850 |
Corporate | ||
Depreciation and Amortization Expense | ||
Depreciation and amortization expense | $ 73 | $ 56 |
Segment and Related Informati62
Segment and Related Information - Revenue by Client Type (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Consulting Fee Revenue and Total Revenue By Client Type: | ||
Revenues | $ 116,120 | $ 136,899 |
Revenues (as a percent) | 100.00% | 100.00% |
U.S. federal government | ||
Consulting Fee Revenue and Total Revenue By Client Type: | ||
Revenues | $ 3,221 | $ 2,858 |
Revenues (as a percent) | 2.80% | 2.10% |
U.S. state, regional and local governments | ||
Consulting Fee Revenue and Total Revenue By Client Type: | ||
Revenues | $ 35,240 | $ 33,973 |
Revenues (as a percent) | 30.30% | 24.80% |
Foreign governments | ||
Consulting Fee Revenue and Total Revenue By Client Type: | ||
Revenues | $ 36,582 | $ 52,553 |
Revenues (as a percent) | 31.50% | 38.40% |
Private sector | ||
Consulting Fee Revenue and Total Revenue By Client Type: | ||
Revenues | $ 41,077 | $ 47,515 |
Revenues (as a percent) | 35.40% | 34.70% |
Segment and Related Informati63
Segment and Related Information - Property, Plant and Equipment, Net by Geographic Location (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | $ 15,715 | $ 16,389 |
U.S./Canada | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 12,069 | 12,626 |
Latin America | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 865 | 881 |
Europe | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 892 | 218 |
Middle East | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 1,603 | 1,645 |
North Africa | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | 151 | 169 |
Asia/Pacific | ||
Property, Plant and Equipment, Net by Geographic Location: | ||
Property, plant and equipment, net | $ 135 | $ 850 |
Commitments and Contingencies -
Commitments and Contingencies - General Litigation and Acquisition-Related Contingencies (Details) | Jun. 17, 2016BRL (R$)shareholder | Oct. 05, 2015USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2013USD ($) |
ESA | |||||
Acquisition-Related Contingencies | |||||
Number of minority shareholders who exercised Put Option | shareholder | 3 | ||||
Value of shares purchased on exercise of Put Options | R$ 8656000 | $ 2,670,000 | |||
M.A. Angeliades, Inc. 2013 Complaint | |||||
Acquisition-Related Contingencies | |||||
Possible loss contingency | $ 8,771,000 | ||||
Settlement amount | $ 2,596,000 | ||||
Interest amount | 1,056,000 | ||||
Interest accrued | $ 448,000 | ||||
Interest amount charged to expense | $ 608,000 | ||||
Hill Spain | ESA | |||||
Acquisition-Related Contingencies | |||||
Ownership interest acquired (as a percent) | 91.00% | ||||
Multiple of earnings for determining purchase price of minority shares | 7 | ||||
Call option purchase price premium if exercised by Hill Spain (as a percent) | 5.00% | ||||
Call/put option exercise period after audited financial statements | 3 months |
Commitments and Contingencies-
Commitments and Contingencies- Other (Details) | Jul. 13, 2015USD ($)item | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Potential Tax Liability Relating to Foreign Subsidiaries | $ 400,000 | ||
Grant received | $ 1,000,000 | ||
Minimum capital expenditure required to be made to receive grant | $ 6,425,000 | ||
Minimum term of lease | 7 years | ||
Minimum persons to be employed | item | 359 | ||
Term of lease | 12 years | ||
Loan | 155,300,000 | $ 144,103,000 | |
Other liabilities | |||
Potential Tax Liability Relating to Foreign Subsidiaries | 2,545,000 | ||
Tenant improvement allowance from landlord | $ (3,894,000) | $ (3,894,000) | |
Amortization period for tenant improvements | 12 years | 12 years | |
Other liabilities | Discontinued operations, Held for sale | |||
Potential Tax Liability Relating to Foreign Subsidiaries | $ 410,000 |
Subsequent Events - Sale of Con
Subsequent Events - Sale of Construction Claims Group (Details) | May 05, 2017USD ($) |
Discontinued operations, Sold | Construction Claims Group | |
Subsequent events | |
Estimated working capital adjustment | $ 8,449,000 |
Assumed indebtedness | 2,187,000 |
Discontinued operations, Sold | Construction Claims Group | Subsequent event | |
Subsequent events | |
Discontinued operation, consideration | 140,000,000 |
Discontinued operations, Sold | Construction Claims Group | Indemnification obligations | |
Subsequent events | |
Letters of credit outstanding | $ 3,750,000 |
Period of escrow for indemnification obligations | 12 months |
Secured Credit Facilities | Subsequent event | |
Subsequent events | |
Payment of accrued interest and certain bank fees | $ 1,214,000 |
Term loan payable | Secured Credit Facilities | Subsequent event | |
Subsequent events | |
Pay off and termination of term loan | 117,000,000 |
Revolving credit facility | Secured Credit Facilities | Subsequent event | |
Subsequent events | |
Letters of credit outstanding | 9,193,000 |
U.S. Revolver | Secured Credit Facilities | Subsequent event | |
Subsequent events | |
Pay down of revolving loan facility | 25,000,000 |
International Revolver | Secured Credit Facilities | Subsequent event | |
Subsequent events | |
Pay down of revolving loan facility | $ 8,793,000 |
Subsequent Events - Financing T
Subsequent Events - Financing Transactions (Details) - Secured Credit Facilities | May 05, 2017USD ($) | Sep. 26, 2014EUR (€) | Jun. 30, 2017USD ($) | Mar. 31, 2017EUR (€) | Mar. 31, 2017USD ($) | Sep. 26, 2014USD ($) |
Subsequent event | Forecast | Loss From discontinued operations | ||||||
Subsequent events | ||||||
Write-off of deferred financing costs | $ 5,622,000 | |||||
Term loan payable | ||||||
Subsequent events | ||||||
Term of debt | 6 years | |||||
Revolving credit facility | ||||||
Subsequent events | ||||||
Term of debt | 5 years | |||||
Revolving credit facility | Subsequent event | ||||||
Subsequent events | ||||||
Cash drawn on credit facility | $ 25,191,000 | |||||
Letters of credit outstanding | $ 9,193,000 | |||||
Term of debt | 5 years | |||||
Maximum Consolidated Net Leverage Ratio | 3 | |||||
Deferred fees | $ 1,625,000 | |||||
U.S. Revolver | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | $ 30,000,000 | $ 30,000,000 | ||||
U.S. Revolver | Letters of credit | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | 25,000,000 | |||||
Letters of credit outstanding | 4,470,000 | |||||
U.S. Revolver | Subsequent event | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | 25,000,000 | |||||
U.S. Revolver | Subsequent event | Letters of credit | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | 20,000,000 | |||||
International Revolver | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | € 11,765,000 | € 11,765,000 | $ 12,573,000 | 15,000,000 | ||
International Revolver | Letters of credit | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | $ 10,000,000 | |||||
International Revolver | Subsequent event | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | 10,000,000 | |||||
International Revolver | Subsequent event | Letters of credit | ||||||
Subsequent events | ||||||
Maximum borrowing capacity | $ 8,000,000 |
Subsequent Events - Resignation
Subsequent Events - Resignation of Chief Executive Officer (Details) - Chief Executive Officer - Subsequent event - Separation Agreement | May 09, 2017USD ($) | May 03, 2017USD ($)itemshares | Jun. 30, 2017USD ($) |
Subsequent events | |||
Amount of severance payable | $ 2,200,000 | $ 3,300,000 | |
Severance paid | $ 1,100,000 | ||
Period for remaining severance payments | 2 years | ||
Unused vacation payable | $ 256,000 | ||
Number of options for accelerated vesting | shares | 1,000,000 | ||
Total number of vested options available | shares | 2,100,000 | ||
Accelerated compensation expense | $ 1,630,000 | ||
Period for payment of COBRA premiums | 18 months | ||
Number of personal vehicles for which expenses are to be reimbursed | item | 1 | ||
Forecast | |||
Subsequent events | |||
Total cost of benefits | $ 5,100,000 |
Subsequent Events - Appointment
Subsequent Events - Appointment of Interim Chief Executive Officer (Details) - Subsequent event - Interim Chief Executive Officer | May 10, 2017$ / mo |
Subsequent events | |
Officers base salary | 60,000 |
Target incentive award | 50,000 |
Target incentive that is based on retention of key employees (as a percent) | 33.30% |
Target incentive that is based on achieving forecasted liquidity metric (as a percent) | 33.30% |
Target incentive that is based on achievement of cost savings annual run rate (as a percent) | 33.30% |
Share-based compensation | 80,000 |
Living expense before tax allowance | 5,000 |
Subsequent Events - Resignati70
Subsequent Events - Resignation of Chief Financial Officer (Details) - Subsequent event - Chief Financial Officer | Feb. 09, 2018USD ($) | Nov. 10, 2017USD ($)$ / h |
Subsequent events | ||
Service rate per hour | $ / h | 233.56 | |
Lump sum compensation payable in 30 days | $ 232,500 | $ 232,500 |
Accrued vacation | $ 66,000 | |
Non-compete provision duration (in years) | 2 years | |
Maximum | ||
Subsequent events | ||
Transition services per week to be provided (in hours) | 10 |
Subsequent Events - Appointme71
Subsequent Events - Appointment of Interim Chief Financial Officer (Details) | Nov. 10, 2017$ / yr |
Subsequent event | Interim Chief Financial Officer | |
Subsequent events | |
Officers base salary | 420,000 |
Subsequent Events - Finalizatio
Subsequent Events - Finalization of ESA purchase (Details) - Subsequent event - ESA | 1 Months Ended | 12 Months Ended | ||||
Mar. 31, 2018BRL (R$) | Mar. 31, 2018USD ($) | Feb. 28, 2018BRL (R$) | Feb. 28, 2018USD ($) | Dec. 31, 2017BRL (R$) | Dec. 31, 2017USD ($) | |
Acquisitions | ||||||
Reduced total payment to acquire business | R$ 6084000 | $ 1,873,000 | ||||
Adjustment to additional paid-in capital | R$ 3146000 | $ 953,000 | R$ 4475000 | $ 1,365,000 |
Subsequent Events - Tax Cuts an
Subsequent Events - Tax Cuts and Jobs Act (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2017 | Dec. 31, 2018 | |
Subsequent events | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 35.00% | |
Forecast | Subsequent event | ||
Subsequent events | ||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% |
Subsequent Events - Performance
Subsequent Events - Performance Guarantee (Details) | Feb. 08, 2018USD ($) |
Subsequent event | Forecast | |
Subsequent events | |
Amount of performance guaranteed | $ 7,927,000 |